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(iv) For clarity: |
(A) The Licensed Product and Major Market for which Regulatory Approval is obtained for any of such three (3) distinct Additional Indications may, but need not, be the same Licensed Product or Major Market, respectively; provided that once a milestone payment has been paid for receiving Regulatory Approval in a Major M... |
(B) For purposes of this Section 6.2, any patient population within a given Additional Indication shall be deemed an Additional Indication, but once a milestone payment is made under this Section 6.2.2 for any patient population within a given Additional Indication (i.e. disease category, as defined in Section 1.112 ab... |
(C) The total amount payable under this Section 6.2.2 with respect to a Collaboration Program shall not exceed Two Hundred Twenty-Five Million Dollars ($225,000,000). |
6.2.3 Upon enrollment of the first patient in an Open Label Extension Study for a Licensed Product containing a Licensed CD33 Antibody, AbbVie shall pay to Licensor a milestone payment in the amount of Seventeen Million Eight Hundred Thousand Dollars ($17,800,000). |
6.2.4 Upon enrollment of the first patient in an Open Label Extension Study for a Licensed Product containing a Licensed Trem2 Antibody, AbbVie shall pay to Licensor a milestone payment in the amount of Seventeen Million Eight Hundred Thousand Dollars ($17,800,000). |
6.2.5 Each milestone payment in Section 6.2.1, 6.2.2, 6.2.3, and 6.2.4 shall be payable only upon the first achievement of such milestone with respect to a Collaboration Program and no amounts shall be due for subsequent or repeated achievements of such milestone with respect to such Collaboration Program, whether for ... |
6.3 Profit and Loss. |
6.3.1 Licensor Commercialization Opt Out. If Licensor has not already exercised a Development Opt Out for the applicable Collaboration Program, Licensor, may, upon ninety (90) days advance written notice to AbbVie, opt out of sharing US Net Losses for one or both Collaboration Programs, as applicable (a "Licensor Comme... |
6.3.2 Profit and Loss Sharing. If AbbVie has exercised its Option with respect to a given Collaboration Program or AbbVie has exercised the AbbVie Opt In with respect to an AbbVie Opt In Product and, in either case, Licensor has not exercised its Licensor Opt Out with respect to such Collaboration Program(s)or AbbVie O... |
(a) United States. Subject to Section 6.4, (i) Licensor shall receive fifty percent (50%) of all US Net Profits, and bear fifty percent (50%) of all US Net Losses, as applicable, attributable to Licensed Products for the United States, and (ii) AbbVie shall receive fifty percent (50%) of all US Net Profits, and bear fi... |
(b) Rest of World. Subject to Section 6.4, (i) AbbVie shall receive one hundred percent (100%) of ROW Profit for each Collaboration Program until the aggregate Row Profit received by AbbVie reaches three hundred fifty million dollars ($350,000,000) (the "ROW Profit Threshold") for such Collaboration Program; and (ii) t... |
6.4 Calculation and Payment of US Net Profit, US Net Loss or ROW Profit Share. |
6.4.1 United States Reports and Payments. If AbbVie has exercised its Option with respect to a given Collaboration Program or AbbVie has exercised the AbbVie Opt In with respect to an AbbVie Opt In Product and, in either case, Licensor has not exercised a Licensor Opt Out with respect to the applicable Collaboration Pr... |
6.4.2 ROW Reports and Payments. If AbbVie has exercised its Option with respect to a given Collaboration Program or AbbVie has exercised the AbbVie Opt In with respect to an AbbVie Opt In Product and, in either case, Licensor has not exercised a Licensor Opt Out with respect to the applicable Collaboration Program or A... |
6.4.3 Last Calendar Quarter. No separate payment shall be made for the last Calendar Quarter in any Calendar Year. Instead, at the end of each such Calendar Year, a final reconciliation shall be conducted by comparing the share of ROW Profit, US Net Profit or US Net Loss, as applicable, to which a Party is otherwise en... |
6.4.4 FTE Records and Calculations. Each Party shall record and account for its FTE effort with respect to each Licensed Antibody or Licensed Product to the extent that such FTE efforts are included in Manufacturing Costs, Development Costs or Allowable Expenses that are, or may in the future be, shared under this Agre... |
6.4.5 Methodology of Allocations for Allowable Expenses. Prior to Regulatory Approval for the applicable Licensed Product or as reasonably requested thereafter (but no more than once annually), AbbVie shall provide Licensor with its methodologies for allocations of Allowable Expenses between the United States and the R... |
6.5 Royalties. If AbbVie has exercised its Option with respect to a given Collaboration Program or AbbVie has exercised the AbbVie Opt In with respect to an AbbVie Opt In Product and, in either case Licensor has exercised a Licensor Opt Out with respect to such Collaboration Program or AbbVie Opt In Product, as applica... |
6.5.1 Royalty Rates. As further consideration for the rights granted to AbbVie hereunder, subject to Sections 6.5.2 and 6.5.4 below, commencing upon the First Commercial Sale of a Licensed Product in the Territory, on a Licensed Product-by-Licensed Product basis, AbbVie shall pay to Licensor a royalty on Net Sales of e... |
6.5.2 Adjustment Based on Development Costs Paid by Licensor. |
(a) Adjusted Royalty Rate. If Licensor exercises a Licensor Opt Out with respect to a Collaboration Program after it has shared a portion of Development Costs of Post Exercise Development Activities under Section 3.7.1(b) above, the royalty rate under Section 6.5.1 shall be increased with respect to such Collaboration ... |
(b) Second Generation Products; Additional Indications. If, after Licensor exercises a Licensor Opt Out for a Collaboration Program and Regulatory Approval is obtained for a Licensed Product within such Collaboration Program, AbbVie desires to pursue Regulatory Approval for one or more additional Licensed Products (eac... |
(i) Notice of Approval. Within thirty (30) days after AbbVie's receipt of the first Regulatory Approval for such Second Generation Product or for such Additional Indication in the first Major Market, AbbVie shall provide Licensor with written notice of the receipt of such Regulatory Approval, together with a statement ... |
(ii) Licensor Continued Funding. Within sixty (60) days after receiving such Notice of Approval, Licensor may, at its election, notify AbbVie that Licensor will reimburse AbbVie for one hundred and fifty percent (150%) of Licensor's Proportionate Share of the Additional Development Costs so reflected in the Notice of A... |
(iii) Licensor Election Not to Continue Funding an Additional Indication. If Licensor does not provide to AbbVie a Licensor Continued Funding Notice in accordance with Section 6.5.2(b)(ii) above with respect to a given Notice of Approval, then the following shall apply: |
(A) Second Generation Products. If the Notice of Approval pertained to the first Regulatory Approval for a Second Generation Product, then the Adjusted Royalty Rate under Section 6.5.2(a) for the applicable Collaboration Program shall not apply to such Second Generation Product, and only the Base Royalty specified in S... |
(B) Excluded Indications. If the Notice of Approval pertained to the first Regulatory Approval for the applicable Additional Indication for a Licensed Product, then the Adjusted Royalty Rate under Sections 6.5.1(b) for the applicable Collaboration Program shall not apply to Net Sales of such Licensed Product for such A... |
(c) Adjustment Based on COGS. Notwithstanding Sections 6.5.1 and 6.5.2(a) and (b) above, if (i) the Manufacturing Costs of the units of a particular Licensed Product for which Net Sales were received in a Calendar Quarter, expressed as a percentage of such Net Sales exceeds ten percent (10%) of such Net Sales, and (ii)... |
6.5.3 Royalty Term. AbbVie shall have no obligation to pay any royalties under this Section 6.5 with respect to Net Sales of any Licensed Product in any country or other jurisdiction after the Royalty Term for such Licensed Product in such country or other jurisdiction has expired. |
6.5.4 Reductions. Notwithstanding the foregoing: |
(a) in the event that in any country or other jurisdiction in the Territory during the Royalty Term for a Licensed Product there is Biosimilar Competition resulting in at least a twenty percent (20%) loss in Net Sales of such Licensed Product in such country or other jurisdiction in a Calendar Year from the Net Sales o... |
(b) in the event that AbbVie enters into an agreement with a Third Party in order to obtain a license or right under a Patent or intellectual property right owned or controlled by such Third Party in a particular country or other jurisdiction or in the event of any Third Party Technology as set forth in Section 5.7, fo... |
(c) in the event that a court or a governmental agency of competent jurisdiction requires AbbVie or any of its Affiliates or Sublicensees to grant a compulsory license to a Third Party permitting such Third Party to make and sell a Licensed Product in a country or other jurisdiction in the Territory, sales of such Lice... |
(d) For clarity, the reductions in Sections 6.5.2(c), and 6.5.4(b) above shall be applied prior to determining the reductions under Section 6.5.4(a) above (i.e., so that the fifty percent (50%) reduction under Section 6.5.4(a) shall apply to the net royalty determined after applying any reductions in Section 6.5.2(c) o... |
(e) AbbVie shall similarly have the right to deduct from Net Sales of the applicable Licensed Product in the applicable country those costs that would have been includable as Allowable Expenses in accordance with Sections 7.2.1, 7.2.2, 7.4 and 7.5.5 if Section 6.3.2 had applied, for purposes of calculating the royalty ... |
6.6 Payments and Reports. |
6.6.1 Royalties. AbbVie shall calculate all amounts payable to Licensor pursuant to Section 6.5 at the end of each Calendar Quarter, which amounts shall be converted to Dollars, in accordance with Section 6.7. AbbVie shall pay to Licensor the royalty amounts due with respect to a given Calendar Quarter within ninety (9... |
6.6.2 Compliance with Public Reporting Obligations. In the event Licensor becomes a public reporting company in the United States pursuant to an effective registration statement under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (or corresponding Applicable Law of another c... |
6.7 Mode of Payment; Offsets. All payments to either Party under this Agreement shall be made by deposit of Dollars in the requisite amount to such bank account as the receiving Party may from time to time designate by notice to the paying Party. For the purpose of calculating any sums due under, or otherwise reimbursa... |
6.8 Accounting Procedures. For purposes of determining Development Costs and Allowable Expenses, any expense allocated by either Party to a particular expense category of Development Costs or Allowable Expenses shall not also be allocated to another category under Development Costs or Allowable Expenses. Subject to Sec... |
6.9 Withholding Taxes. Where any sum due to be paid to either Party hereunder is subject to any withholding or similar tax, the Parties shall use their commercially reasonable efforts to do all such acts and things and to sign all such documents as will enable them to take advantage of any applicable double taxation ag... |
6.10 Indirect Taxes. All payments are exclusive of value added taxes, sales taxes, consumption taxes and other similar taxes (the "Indirect Taxes"). If any Indirect Taxes are chargeable in respect of any payments, the paying Party shall pay such Indirect Taxes at the applicable rate in respect of such payments followin... |
6.11 Interest on Late Payments. If any payment due to either Party under this Agreement is not paid when due, then such paying Party shall pay interest thereon (before and after any judgment) at an annual rate (but with interest accruing on a daily basis) of three hundred (300) basis points above the thirty (30)-day Lo... |
6.12 Financial Records. Each Party shall, and shall cause its Affiliates to, keep complete and accurate books and records pertaining to Development Costs and AbbVie shall, and shall cause its Affiliates and Sublicensees to, keep complete and accurate books and records pertaining to Net Sales of Licensed Products and, i... |
6.13 Audit. At the request of the other Party, each Party shall, and shall cause its Affiliates to, permit an independent public accounting firm of nationally recognized standing designated by the other Party and reasonably acceptable to the audited Party, at reasonable times during normal business hours and upon reaso... |
6.14 Audit Dispute. In the event of a dispute with respect to any audit under Section 6.13, Licensor and AbbVie shall work in good faith to resolve the disagreement. If the Parties are unable to reach a mutually acceptable resolution of any such dispute within thirty (30) days, the dispute shall be submitted for resolu... |
6.15 Confidentiality. The receiving Party shall treat all information subject to review under this ARTICLE 6 in accordance with the confidentiality provisions of ARTICLE 9 and the Parties shall cause the Audit Arbitrator to enter into a reasonably acceptable confidentiality agreement with the audited Party obligating s... |
6.16 Diagnostic. The regulatory milestones and royalties in Sections 6.2 and 6.5 shall not apply to Development and Commercialization of Licensed Antibodies or Licensed Products for diagnostic use, or for uses solely for screening patients who have been diagnosed with a disease, state, or condition for eligibility to b... |
6.17 No Other Compensation. Each Party hereby agrees that the terms of this Agreement fully define all consideration, compensation and benefits, monetary or otherwise, to be paid, granted or delivered by one (1) Party to the other Party in connection with the transactions contemplated herein. Neither Party previously h... |
ARTICLE 7. INTELLECTUAL PROPERTY |
7.1 Ownership of Intellectual Property. |
7.1.1 Licensor Ownership. As between the Parties, Licensor shall own all right, title and interest in and to any and all Licensor Background Patents, Licensor Background Know-How, Licensor Program Patents and Licensor Program Know-How. |
7.1.2 AbbVie Ownership. As between the Parties, AbbVie or an Affiliate designated by AbbVie shall own and retain all right, title, and interest in and to any and all AbbVie Background Patents, AbbVie Background Know-How, AbbVie Program Patents and AbbVie Program Know-How. |
7.1.3 Ownership of Joint Program Patents and Joint Program Know-How. Subject to Section 3.8.2(a), as between the Parties, the Parties shall each own an equal, undivided interest in any and all Joint Program Patents and Joint Program Know-How. Subject to the licenses and rights of reference granted under Sections 5.2 an... |
7.1.4 United States Law. The determination of whether Information and inventions are conceived, discovered, developed, or otherwise made by a Party for the purpose of allocating proprietary rights (including Patent, copyright or other intellectual property rights) therein, shall, for purposes of this Agreement, be made... |
7.1.5 Assignment and Disclosure Obligation. |
(a) Each Party and its Affiliates shall cause all of their employees who perform Development activities, Manufacturing activities or regulatory activities for such Party under this Agreement to be under an obligation to assign their rights in any Information and inventions resulting therefrom to such Party. For clarity... |
(b) Each Party shall disclose to the other Party, and shall cause its Affiliates, licensees and sublicensees or subcontractors to so disclose, any Joint Program Patents, Licensor Program Patents or AbbVie Program Patents it proposes to file reasonably in advance of filing. Each Party shall use Commercially Reasonable E... |
7.1.6 Ownership of Corporate Names. As between the Parties, Licensor shall retain all right, title and interest in and to its Corporate Names. |
7.2 Maintenance and Prosecution of Patents. |
7.2.1 Patent Prosecution and Maintenance of Licensor Background Patents and Licensor Program Patents. Licensor shall have the right, but not the obligation, through the use of internal or outside counsel reasonably acceptable to AbbVie, to prepare, file, prosecute, and maintain worldwide the Licensor Background Patents... |
Notwithstanding the foregoing, Licensor shall promptly inform AbbVie of any adversarial patent office proceeding or sua sponte filing, including a request for, or filing or declaration of, any interference, opposition, or post-grant proceeding or reexamination relating to such a Patent in the Territory. The Parties sha... |
7.2.2 Patent Prosecution and Maintenance of Joint Program Patents. Prior to the Option Exercise Date for a given Collaboration Program, Licensor shall have the right, but not the obligation, through the use of internal or outside counsel reasonably acceptable to AbbVie, to prepare, file, prosecute, and maintain worldwi... |
The Controlling Party shall keep the Non-Controlling Party fully informed of all steps with regard to the preparation, filing, prosecution, and maintenance of such Patents, including by providing the Non-Controlling Party with a copy of material communications to and from any patent authority in the Territory regarding... |
Notwithstanding the foregoing, the Controlling Party shall promptly inform the Non-Controlling Party of any adversarial patent office proceeding or sua sponte filing, including a request for, or filing or declaration of, any interference, opposition, or post-grant proceeding or reexamination relating to such a Patent i... |
In the event that the Controlling Party decides not to prepare, file, prosecute, or maintain such a Patent in a country or other jurisdiction in the Territory, the Controlling Party shall provide reasonable prior written notice to the Non-Controlling Party of such intention (which notice shall, in any event, be given n... |
7.2.3 Patent Prosecution and Maintenance of AbbVie Background Patents and AbbVie Program Patents. AbbVie shall have the sole right, but not the obligation, to prepare, file, prosecute and maintain the AbbVie Background Patents and AbbVie Program Patents worldwide, at AbbVie's sole cost and expense. AbbVie shall keep Li... |
7.2.4 Cooperation. The Parties agree to cooperate fully in the preparation, filing, prosecution, and maintenance of the Licensor Background Patents, Licensor Program Patents, AbbVie Program Patents, and Joint Program Patents in the Territory under this Agreement. Cooperation shall include: |
(a) executing all papers and instruments, or requiring its employees or contractors to execute such papers and instruments, so as to (i) effectuate the ownership of intellectual property set forth in Section 7.1; (ii) enable the other Party to apply for and to prosecute Patent applications in the Territory; and (iii) o... |
(b) consistent with this Agreement, assisting in any license registration processes with applicable governmental authorities that may be available in the Territory for the protection of a Party's interests in this Agreement; and |
(c) promptly informing the other Party of any matters coming to such Party's attention that may materially affect the preparation, filing, prosecution, or maintenance of any such Licensor Background Patents, Licensor Program Patents, AbbVie Program Patents, and Joint Program Patents worldwide in the Territory. |
7.2.5 Patent Term Extension and Supplementary Protection Certificate. Beginning after the Option Exercise Date for a given Collaboration Program, AbbVie shall be responsible for making decisions regarding patent term extensions, including supplementary protection certificates and any other extensions that are now or be... |
7.2.6 Patent Listings. Beginning or after the Option Exercise Date for a given Collaboration Program, AbbVie shall have the sole right to make all patent listings of such Patents with Regulatory Authorities in the Territory. Licensor shall cooperate with the AbbVie's reasonable requests in connection therewith, includi... |
7.2.7 European Patents. AbbVie shall have the sole right to decide whether a European Patent within Licensor Background Patents, Licensor Program Patents and Joint Program Patents should be validated or maintained as a Unitary Patent, whether and when such European Patent should be opted out of or opted in to the juris... |
7.3 Enforcement of Patents. |
7.3.1 Enforcement of Licensor Background Patents, Licensor Program Patents, and Joint Program Patents. Each Party shall promptly notify the other Party in writing of any alleged, threatened or actual infringement of the Licensor Background Patents, Licensor Program Patents, or Joint Program Patents by a Third Party in ... |
In the event AbbVie prosecutes any Product Infringement, Licensor shall have the right to join as a party to such claim, suit, or proceeding in the Territory and participate with its own counsel at its own expense; provided that AbbVie shall retain control of the prosecution of such claim, suit, or proceeding. During a... |
If AbbVie does not take commercially reasonable steps to prosecute a Product Infringement (i) within ninety (90) days following the first notice provided above with respect to the Product Infringement, or (ii) provided such date occurs after the first such notice of the Product Infringement is provided, ten (10) Busine... |
7.3.2 Enforcement of AbbVie Background Patents and AbbVie Program Patents. AbbVie shall have the sole right, but not the obligation, to prosecute any infringement of AbbVie Background Patents or AbbVie Program Patents at its sole expense (provided such costs with respect to AbbVie Program Patents shall be deemed an All... |
7.3.3 Conduct of Patent Litigation Under the Biologics Price Competition and Innovation Act. If either Party receives a copy of an application submitted to the FDA under subsection (k) of Section 351 of the PHSA or equivalent in any other jurisdiction in the Territory (a "Biosimilar Application") naming a Licensed Prod... |
If either Party receives any equivalent or similar certification or notice in any other jurisdiction in the Territory, either Party shall, within three (3) Business Days, notify and provide the other Party with copies of such communication. Regardless of the Party that is the "reference product sponsor" for purposes of... |
7.3.4 Cooperation. The Parties agree to cooperate fully in any infringement action pursuant to this Section 7.3. Where a Party brings such an action, the other Party shall, where necessary, furnish a power of attorney solely for such purpose or shall join in, or be named as a necessary party to, such action. Unless oth... |
Each Party shall use Commercially Reasonable Efforts to avoid making any admissions or asserting any position in such infringement action with specific intent to materially diminish the other Party's rights or interest under this Agreement. The Party commencing the litigation shall provide the other Party with copies o... |
7.3.5 Recovery. Except as otherwise agreed by the Parties in connection with a cost sharing arrangement, any recovery realized as a result of litigation described in Section 7.3.1 or 7.3.3 (whether by way of settlement or otherwise) shall be first, allocated to reimburse the Parties for their costs and expenses in maki... |
AbbVie shall retain all recoveries realized as a result of such litigation described in Section 7.3.2. Notwithstanding anything to the contrary, (i) if Licensor has exercised a Licensor Opt Out, Licensor is solely responsible for any recovery sharing obligations under the Adimab Agreement and (ii) if Licensor has not e... |
7.4 Infringement Claims by Third Parties. If the manufacture, sale, or use of a Licensed Antibody or Licensed Product in the Territory pursuant to this Agreement results in, or may result in, any claim, suit, or proceeding by a Third Party alleging patent infringement by AbbVie (or its Affiliates or Sublicensees), AbbV... |
Licensor may participate in any such claim, suit, or proceeding with counsel of its choice at its own expense. Without limitation of the foregoing, if AbbVie finds it necessary or desirable to join Licensor as a party to any such action, Licensor shall execute all papers and perform such acts as shall be reasonably req... |
Each Party agrees to provide the other Party with copies of all pleadings filed in such action and to allow the other Party reasonable opportunity to participate in the defense of the claims. If Licensor has exercised a Licensor Opt Out for a Collaboration Program and such costs are not included as an Allowable Expense... |
Any recoveries by AbbVie of any sanctions awarded to AbbVie and against a party asserting a claim being defended under this Section 7.4 shall be applied as follows: such recovery shall be applied first to reimburse each Party (in proportion to amounts expended) for its reasonable Out-of-Pocket Costs of defending such c... |
7.5 Invalidity or Unenforceability Defenses or Actions. |
7.5.1 Notice. Each Party shall promptly notify the other Party in writing of any alleged or threatened assertion of invalidity or unenforceability of any of the Licensor Background Patents, Licensor Program Patents, AbbVie Program Patents, AbbVie Background Patents and Joint Program Patents by a Third Party, in each ca... |
7.5.2 Licensor Background Patents, Licensor Program Patents, and Joint Program Patents. AbbVie shall have the first right, but not the obligation, to defend and control the defense of the validity and enforceability of the Licensor Background Patents, Licensor Program Patents, and Joint Program Patents at its own expen... |
7.5.3 AbbVie Background Patents and AbbVie Program Patents. AbbVie shall have the sole right, but not the obligation, to defend and control the defense of the validity and enforceability of the AbbVie Background Patents and AbbVie Program Patents at its own expense (except to the extent such expense constitutes an Allo... |
7.5.4 Cooperation. Each Party shall assist and cooperate with the other Party as such other Party may reasonably request from time to time in connection with its activities set forth in this Section 7.5, including by being joined as a party plaintiff in such action or proceeding, providing access to relevant documents ... |
7.5.5 Costs and Expenses. AbbVie shall be entitled to offset the reasonable Out-of-Pocket Costs of defending such claim, suit, or proceeding under this Section 7.5 that are borne by AbbVie and not included as an Allowable Expense against Net Sales for purposes of calculating royalties due under Section 6.5.1. |
7.6 Product Trademarks. |
7.6.1 Ownership and Prosecution of Product Trademarks. AbbVie shall own all right, title, and interest to the Product Trademarks in the Territory, and shall be responsible for the registration, prosecution, and maintenance thereof. All costs and expenses of registering, prosecuting, and maintaining the Product Trademar... |
7.6.2 Enforcement of Product Trademarks. AbbVie shall have the sole right and responsibility for taking such action as AbbVie, after consultation with Licensor, deems necessary against a Third Party based on any alleged, threatened, or actual infringement, dilution, misappropriation, or other violation of, or unfair tr... |
7.6.3 Third Party Claims. AbbVie shall have the sole right and responsibility for defending against any alleged, threatened, or actual claim by a Third Party that the use or registration of the Product Trademarks in the Territory infringes, dilutes, misappropriates, or otherwise violates any Trademark or other right of... |
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