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1. Trends in life sciences alliance agreements
extending the traditional structure of the alliance
Market pressures are driving biotechs and pharmas to stretch the bounds of traditional licenses in their strategic alliances. The creative approaches these companies have brought to bear can be extracted from publicly filed alliance agreements. Alliance partners, seeking to maximise value for themselves and each other, are extending the traditional structure of the alliance. Some examples: Alliances are allowing maturing biotechs to retain more of the value of the opportunity by bearing more of the expense and risk of development. More alliances are arising early in the development process. In order to maximise each party’s flexibility, alliances are structured to give each party multiple opportunities to opt in or opt out of development and commercialisation. Biotechs are retaining more rights, including co-promotion rights, and obtaining other quids to help grow their businesses as part of these collaborations. All trends discussed will be detailed with multiple examples.Market pressures are driving biotechs and pharmas to stretch the bounds of traditional licenses in their strategic alliances. The creative approaches these companies have brought to bear can be extracted from publicly filed alliance agreements. Alliance partners, seeking to maximise value for themselves and each other, are extending the traditional structure of the alliance. Some examples: Alliances are allowing maturing biotechs to retain more of the value of the opportunity by bearing more of the expense and risk of development. More alliances are arising early in the development process. In order to maximise each party’s flexibility, alliances are structured to give each party multiple opportunities to opt in or opt out of development and commercialisation. Biotechs are retaining more rights, including co-promotion rights, and obtaining other quids to help grow their businesses as part of these collaborations. All trends discussed will be detailed with multiple examples.
2. Farris, Vaughan, Wills & Murphy LLP: For over 100 years, FARRIS has provided innovative and practical solutions in all areas of the law to a diverse client base including some of British Columbia's largest public institutions and private corporations. Many of our lawyers have been recognized in the Canadian Legal Lexpert Directory as among the top 500 leading lawyers in Canada. In addition, according to Lexpert Magazine, we are both the top corporate law firm and the top litigation firm in Vancouver.
Our biotech practice has grown with the industry in British Columbia, and I think we have one of the best biotech and licensing practices around.
For over 100 years, FARRIS has provided innovative and practical solutions in all areas of the law to a diverse client base including some of British Columbia's largest public institutions and private corporations. Many of our lawyers have been recognized in the Canadian Legal Lexpert Directory as among the top 500 leading lawyers in Canada. In addition, according to Lexpert Magazine, we are both the top corporate law firm and the top litigation firm in Vancouver.
Our biotech practice has grown with the industry in British Columbia, and I think we have one of the best biotech and licensing practices around.
3. Experienced advisors on collaborations:
4. Trends in life sciences licensing: systematic attempts to analyse how alliance terms are arrived at have been made, e.g.:
“Intra-Alliance Performance, Control Rights, and Today's Split of Tomorrow's Value” Adegbesan, T; Higgins, MJ 2007
"The Control of Technology Alliances: An Empirical Analysis of the Biotechnology Industry” Lerner, J; Merges, RP
For a list of presentations and papers, see:http://del.icio.us/JamesHatton/papers “Intra-Alliance Performance, Control Rights, and Today's Split of Tomorrow's Value”
concerned with “pie splitting” control rights:
ownership of IP;
right to sublicense
rights on expiration
right to manufacture
control of marketing rights (territories, indications, no-co-promotion)
“The Control of Strategic Alliances: An Empirical Analysis of Biotechnology Collaborations”
determinants of control rights in technology strategic alliances; empirical analysis of 200 contracts.
the allocation of control rights to the smaller party increases with its financial health.
the relationship between control rights and the stage of the project at the time the contract is less consistent“Intra-Alliance Performance, Control Rights, and Today's Split of Tomorrow's Value”
concerned with “pie splitting” control rights:
ownership of IP;
right to sublicense
rights on expiration
right to manufacture
control of marketing rights (territories, indications, no-co-promotion)
“The Control of Strategic Alliances: An Empirical Analysis of Biotechnology Collaborations”
determinants of control rights in technology strategic alliances; empirical analysis of 200 contracts.
the allocation of control rights to the smaller party increases with its financial health.
the relationship between control rights and the stage of the project at the time the contract is less consistent
5. Trends in life sciences licensing: idiosyncratic look (from the biotech perspective)
focus on recent important and innovative collaborations
some deal points and implications for structuring life sciences alliances
6. Sources of exceptional collaborations: Recombinant Capital's 2007 “Breakthrough Alliance” nominees
Scrip Awards 2007: “Licensing Deal of the Year” nominees and“Partnership Alliance of the Year”
Recombinant Capital’s recap.com
7. “Breakthrough Alliance” nominees: Janssen Vertex of 06/2007
MedImmune Infinity of 08/2007
GlaxoSmithKline Epix of 12/2006
Takeda Affymax of 06/2006
Novartis HGS of 06/2006 Allicense 2007 nominees (Recap)
Janssen/Vertex 06/2007 Co-Development of VX-950 for Treatment of Hepatitis (public)
MedImmune/Infinity 08/2007 Co-Development and Commercialization Alliance for Small Molecule Cancer Drugs (public)
GSK Epix Pharmaceuticals of 12/2006 GPCR Drug Discovery and Co-Development Alliance(public)
Takeda/Affymax 06/2006 Co-Development of Hematide for Treatment of Anemia
Novartis/HGS of 06/2006 Co-Development of Albuferon for Treatment of Chronic Hepatitis C
All co-development agreements
Allicense 2007 nominees (Recap)
Janssen/Vertex 06/2007 Co-Development of VX-950 for Treatment of Hepatitis (public)
MedImmune/Infinity 08/2007 Co-Development and Commercialization Alliance for Small Molecule Cancer Drugs (public)
GSK Epix Pharmaceuticals of 12/2006 GPCR Drug Discovery and Co-Development Alliance(public)
Takeda/Affymax 06/2006 Co-Development of Hematide for Treatment of Anemia
Novartis/HGS of 06/2006 Co-Development of Albuferon for Treatment of Chronic Hepatitis C
All co-development agreements
8. Scrip Awards nominees (publicly disclosed): ARYx P&G of 06/06
Halozyme Roche of 12/06
Vertex Janssen of 6/06
Pharmacopeia Organon of 02/07 Scrip Awards Shortlist for Licensing Deal of the Year and Best Partnership Alliance (awards are December 4, 2007)
Licensing Deal of the Year (six nominees)
AstraZeneca and BMS to co-develop and co-commercialise two products, dapagliflozin and saxagliptin, for the treatment of type 2 diabetes
Genmab and GSK to co-develop and commercialise ofatumumab (HuMax-CD20) for chronic lymphocytic leukaemia, follicular non-Hodgkin's lymphoma and rheumatoid arthritis
Novartis and Antisoma for the worldwide rights to AS1404, a small-molecule vascular disrupting agent for the treatment of solid tumours
Oxford BioMedica and Sanofi-Aventis for the development and commercialisation of TroVax for the treatment and prevention of cancer
Procter & Gamble Pharmaceuticals with ARYx Therapeutics for the development and commercialisation rights to ATI-7505 for gastrointestinal diseases (public)
Roche and Synosia for the development of five drug candidates for central nervous system disorders
Best Partnership Alliance (six nominees)
Galapagos with GSK to discover and develop novel drugs for osteoarthritis
Pharmacopeia with Organon to discover, develop and commercialise therapeutic products across a range of indications, including neuroscience and immunology (public)
Roche with Halozyme for the application of Halozyme's proprietary Enhanze drug delivery technology to Roche's biological therapeutic compounds (public)
Transgene with Roche to develop and commercialise products from Transgene's therapeutic vaccine programme against human papillomavirus-mediated diseases
Vertex Pharmaceuticals with Janssen Pharmaceutical for the worldwide development and commercialisation of the hepatitis C virus protease inhibitor telaprevir (public)
Wyeth Research with Cure Neurodegeneration Denmark to discover and develop therapeutics to treat neurological disorders such as dementia, Alzheimer's and Parkinson's disease
Scrip Awards Shortlist for Licensing Deal of the Year and Best Partnership Alliance (awards are December 4, 2007)
Licensing Deal of the Year (six nominees)
AstraZeneca and BMS to co-develop and co-commercialise two products, dapagliflozin and saxagliptin, for the treatment of type 2 diabetes
Genmab and GSK to co-develop and commercialise ofatumumab (HuMax-CD20) for chronic lymphocytic leukaemia, follicular non-Hodgkin's lymphoma and rheumatoid arthritis
Novartis and Antisoma for the worldwide rights to AS1404, a small-molecule vascular disrupting agent for the treatment of solid tumours
Oxford BioMedica and Sanofi-Aventis for the development and commercialisation of TroVax for the treatment and prevention of cancer
Procter & Gamble Pharmaceuticals with ARYx Therapeutics for the development and commercialisation rights to ATI-7505 for gastrointestinal diseases (public)
Roche and Synosia for the development of five drug candidates for central nervous system disorders
Best Partnership Alliance (six nominees)
Galapagos with GSK to discover and develop novel drugs for osteoarthritis
Pharmacopeia with Organon to discover, develop and commercialise therapeutic products across a range of indications, including neuroscience and immunology (public)
Roche with Halozyme for the application of Halozyme's proprietary Enhanze drug delivery technology to Roche's biological therapeutic compounds (public)
Transgene with Roche to develop and commercialise products from Transgene's therapeutic vaccine programme against human papillomavirus-mediated diseases
Vertex Pharmaceuticals with Janssen Pharmaceutical for the worldwide development and commercialisation of the hepatitis C virus protease inhibitor telaprevir (public)
Wyeth Research with Cure Neurodegeneration Denmark to discover and develop therapeutics to treat neurological disorders such as dementia, Alzheimer's and Parkinson's disease
9. Sources of alliances of 2007: Recombinant Capital - recap.com
all collaborations valued in excess of $30M from 09/2006 to present
other material agreements as found
ignore those that are not publicly disclosedRecombinant Capital - recap.com
all collaborations valued in excess of $30M from 09/2006 to present
other material agreements as found
ignore those that are not publicly disclosed
10. Source of the full text:
11. Definitive list of alliances of 2007: 40 agreements - full text
text of all agreements linked athttp://del.icio.us/JamesHatton/LES2007 Full text at http://del.icio.us/JamesHatton:
full text of approximately 700 biotech licenses and related agreements
browse by party or type of agreement
Full text at http://del.icio.us/JamesHatton:
full text of approximately 700 biotech licenses and related agreements
browse by party or type of agreement
12. Environment & trends: environment for pharma and biotechs
expectations regarding trends
trends: the reality
some drafting points
13. Environment: pharma ‘empty pipeline’ - drugs coming off patent faster than new drugs coming on to market
rising development costs
research productivity down; declining number of NDAs
increasing uncertainty regarding regulatory treatment United States Government Accountability Office Report to Congressional Requesters
NEW DRUG DEVELOPMENT
Science, Business, Regulatory, and Intellectual Property Issues Cited as Hampering Drug Development Efforts November 2006
United States Government Accountability Office Report to Congressional Requesters
NEW DRUG DEVELOPMENT
Science, Business, Regulatory, and Intellectual Property Issues Cited as Hampering Drug Development Efforts November 2006
14. Environment: biotech competition for programs
tighter money
biotechs want to build the company through vertical growth
biotechs seek higher returns by bearing more of the risk
court decisions hard on licensors
15. Expected trends: more biotech involvement in development and commercialisation
co-development
retention of some commercialisation rights
increased biotech input into alliance decision-making during development
the rise of the option
more profit sharing deals
reaction to court decisions
16. More biotech involvement in development: co-development rights and agreements
conduct of development by biotechs
input into alliance decision-making during development
options
17. Development rights: co-development agreements biotech may have conduct of development to an endpoint
biotech may fund part of the development
biotech may have some meaningful decision rights
biotech may have options on funding or conduct of development
18. Co-development agreements:
19. Co-development agreements with options:
20. Co-development agreements with options: Archemix Merck of 06/07
ARYx P&G of 06/06
Cell Therapeutics Novartis of 09/06
Cytokinetics Amgen of 12/06
Exelixis Genentech of 12/06
InterMune Roche of 09/06
MedImmune Infinity of 08/06
Pharmacopeia Organon of 02/07
21. Biotech may have conduct of development to an endpoint: proof of concept (MedImmune Infinity)
lead selection (Pharmacopeia Organon)
phase I (Exelixis Genentech; InterMune Roche)
phase II (CytoKinetics Amgen)
22. Biotech input into alliance decision-making during development: typically, in the end, the licensee decides
exclusions from JSC process:
conduct of development to endpoint; increases in effort above specified level (Archemix Merck);
breaches, achievement of milestones, diligence or money disputes (ARYx P&G)
disputes to arbitration: all disputes; research plans; achievement of milestones; [trial?] design
23. Rise of the option in co-development: opting in opt in to fund development (Archemix Merck; ARYx P&G; Cytokinetics Amgen)
opt in to co-promote (Archemix Merck; ARYx P&G; Cell Therapeutics Novartis; Cytokinetics Amgen; Exelixis Genentech; InterMune Roche) Opting in:
Archemix option to exercise a co-development and co-promote option on any of the products being developed on a 50:50 cost and profit-sharing basis in the United States; royalties and milestones ROW.
Cytokinetics Amgen is an option to co-fund Phase III - to earn increased royalties. In that case, Cytokinetics can co-promote products in North America
InterMune’s option to co-promote applies only if it opts out of co-development (and therefore co-commercialisation)Opting in:
Archemix option to exercise a co-development and co-promote option on any of the products being developed on a 50:50 cost and profit-sharing basis in the United States; royalties and milestones ROW.
Cytokinetics Amgen is an option to co-fund Phase III - to earn increased royalties. In that case, Cytokinetics can co-promote products in North America
InterMune’s option to co-promote applies only if it opts out of co-development (and therefore co-commercialisation)
24. Rise of the option in co-development: opting out ability to opt out (Archemix Merck; Exelixis Genentech; InterMune Roche; MedImmune Infinity; Pharmacopeia Organon; see also Altus Genentech)
milestones may not apply (Archemix Merck)
royalty rates vary based on timing of the opt-out (MedImmune Infinity) Opting out:
Archemix can opt out of co-development and the product will be commercialised by Merck for royalties and milestones. Some milestones N/A, depending on the opt-out date.
MedImmune: Opportunity for either party to opt out of a program. Royalties vary with when the opt out occurred in the joint development process:
“1.69. "Royalty Percentage" means on a Product-by-Product basis the following percentage depending on the stage of development of each Product in the Project as of the Opt-Out Date for the Project:
Opt-Out Date Percentage
i. Up to dosing of a patient in a Phase I Clinical Trial [***] Percent ([***]%)
ii. After dosing of a patient in a Phase I Clinical Trial and up to dosing of a patient in a Phase II Clinical Trial [***] Percent ([***]%)
iii. After dosing of a patient in a Phase II Clinical Trial up to dosing of a patient in a Pivotal Trial [***] Percent ([***]%)
iv. After dosing of a patient in a Pivotal Trial up to filing for Regulatory Approval in the United States. [***] Percent ([***]%)
v. After filing for Regulatory Approval in the United States and thereafter.
[***] Percent ([***]%)”
Opting out:
Archemix can opt out of co-development and the product will be commercialised by Merck for royalties and milestones. Some milestones N/A, depending on the opt-out date.
MedImmune: Opportunity for either party to opt out of a program. Royalties vary with when the opt out occurred in the joint development process:
“1.69. "Royalty Percentage" means on a Product-by-Product basis the following percentage depending on the stage of development of each Product in the Project as of the Opt-Out Date for the Project:
Opt-Out Date Percentage
i. Up to dosing of a patient in a Phase I Clinical Trial [***] Percent ([***]%)
ii. After dosing of a patient in a Phase I Clinical Trial and up to dosing of a patient in a Phase II Clinical Trial [***] Percent ([***]%)
iii. After dosing of a patient in a Phase II Clinical Trial up to dosing of a patient in a Pivotal Trial [***] Percent ([***]%)
iv. After dosing of a patient in a Pivotal Trial up to filing for Regulatory Approval in the United States. [***] Percent ([***]%)
v. After filing for Regulatory Approval in the United States and thereafter.
[***] Percent ([***]%)”
25. More biotech involvement in commercialisation: co-marketing
co-promotion
input into alliance decision-making during marketing
biotechs building supply capability
retention of rights to some markets: more regional deals
more profit sharing deals More biotech involvement in the development and commercialisation process:
Co-Marketing: independent of selling of identical product under different trademarks
Co-Promotion: co-operative selling of identical product under the same trademark
More biotech involvement in the development and commercialisation process:
Co-Marketing: independent of selling of identical product under different trademarks
Co-Promotion: co-operative selling of identical product under the same trademark
26. Co-marketing agreements: Very few publicly disclosed co-marketing agreements
Perhaps see: Alcon and NovaBay from August 2006; St. Jude Medical Hansen Medical Co-Marketing Agreement of April 30, 2007
Very few publicly disclosed co-marketing agreements
Perhaps see: Alcon and NovaBay from August 2006; St. Jude Medical Hansen Medical Co-Marketing Agreement of April 30, 2007
27. Co-promotion agreements:
28. How biotechs opt in to co-promotion agreements: new agreement based on material terms as listed (Archemix Merck; ARYx P&G; Cell Therapeutics Novartis; Exelixis Genentech; InterMune Roche)
if the parties cannot agree:
arbitrate (Archemix Merck)
option expires (ARYx P&G)
29. License agreements with supply terms:
30. Biotech input into alliance decision-making during commercialisation: typically, limited information rights and perhaps consultation rights
no consultation on price (Cell Therapeutics Novartis)
if joint commercialisation team cannot agree, go to CEOs and then arbitrate (MedImmune Infinity) Traditionally, pharma controls commercialisation, and may report to biotech
Cell Therapeutics Novartis of 09/06
In the event that CTI exercises the Co-Detailing Option, during the Co-Detailing Period, Novartis will consult with CTI through the US JMC regarding the Commercialization planning and strategy in the US for the Product, provided, however, that all such decisions will be at the sole discretion of Novartis.
all marketing activities will be determined and controlled by Novartis and (ii) all strategies and decisions relating to the establishment of the pricing for the Product shall be made solely by Novartis
Exelixis Genentech of 12/06
On commercial issues, Genentech shall have the final authority to make the determination, so long as that determination is consistent with this Agreement and the Co-Promotion Agreement.
MedImmune Infinity of 08/06
Prior to an opt-out, if the joint development team or joint commercialisation team cannot agree, go to CEOs and then arbitrate.
Traditionally, pharma controls commercialisation, and may report to biotech
Cell Therapeutics Novartis of 09/06
In the event that CTI exercises the Co-Detailing Option, during the Co-Detailing Period, Novartis will consult with CTI through the US JMC regarding the Commercialization planning and strategy in the US for the Product, provided, however, that all such decisions will be at the sole discretion of Novartis.
all marketing activities will be determined and controlled by Novartis and (ii) all strategies and decisions relating to the establishment of the pricing for the Product shall be made solely by Novartis
Exelixis Genentech of 12/06
On commercial issues, Genentech shall have the final authority to make the determination, so long as that determination is consistent with this Agreement and the Co-Promotion Agreement.
MedImmune Infinity of 08/06
Prior to an opt-out, if the joint development team or joint commercialisation team cannot agree, go to CEOs and then arbitrate.
31. More biotech involvement in commercialisation: continued more regional deals
profit sharing deals
32. Regional deals: world-wide rights on the wane: A decreasing percentage of total licensing deals include WW rights
information courtesy of James Watson, Burrill & Company Merchant Banking
A decreasing percentage of total licensing deals include WW rights
information courtesy of James Watson, Burrill & Company Merchant Banking
33. Regional deals: Asia and America on the rise: Rights for Asia and North American only are increasing, Europe is decreasingRights for Asia and North American only are increasing, Europe is decreasing
34. Profit sharing 50/50 deals:
35. Reaction to court decisions: MedImmune v. Genentech
Licensees can now seek to invalidate licensor’s patents without breaching the license
'No challenges to IP' language in licenses
KSR v. Teleflex
More patents will be found to be invalid due to obviousness
Royalties that don’t rely on or 'survive' the patent MedImmune v. Genentech: U.S. Supreme Court held by an 8-1 majority that a patent licensee is not required to terminate its license agreement before seeking a declaratory judgment that the subject patent is invalid, unenforceable, or not infringed.
KSR and Teleflex: Obviousness (from Wikipedia)
When the standard was applied to the facts before the Court, the Court stated:
The proper question to have asked was whether a pedal designer of ordinary skill, facing the wide range of needs created by developments in the field of endeavor, would have seen a benefit to upgrading [a prior art patent] with a sensor.
Recognition of a benefit is arguably different than being motivated to make a change. For example, the benefit to having an eraser on the end of a pencil can be recognized by all, but does that make a pencil-eraser combination obvious?
MedImmune v. Genentech: U.S. Supreme Court held by an 8-1 majority that a patent licensee is not required to terminate its license agreement before seeking a declaratory judgment that the subject patent is invalid, unenforceable, or not infringed.
KSR and Teleflex: Obviousness (from Wikipedia)
When the standard was applied to the facts before the Court, the Court stated:
The proper question to have asked was whether a pedal designer of ordinary skill, facing the wide range of needs created by developments in the field of endeavor, would have seen a benefit to upgrading [a prior art patent] with a sensor.
Recognition of a benefit is arguably different than being motivated to make a change. For example, the benefit to having an eraser on the end of a pencil can be recognized by all, but does that make a pencil-eraser combination obvious?
36. ‘No challenges to IP’ language in licenses: Targacept GlaxoSmithKline of 07/07
licensor may terminate by focus area if patents challenged
Archemix Merck; Archemix Takeda
90 days prior notice; disclose of prior art; initiation of discussions
licenses may become non-exclusive
if challenge fails, royalty rates increase
if challenge succeeds, new royalty rate Targacept may terminate with respect to any particular therapeutic focus area if GSK challenges the scope, validity or enforceability of certain patents that cover compounds in development
Archemix Merck:
Licensee must give 90 days prior notice and disclose all prior art it will rely on
senior officers shall promptly initiate discussions
exclusive licenses may become non-exclusive
if patent is determined to be valid or enforceable or infringed, royalty rates increase
if challenge succeeds, continue to pay royalties at new rateTargacept may terminate with respect to any particular therapeutic focus area if GSK challenges the scope, validity or enforceability of certain patents that cover compounds in development
Archemix Merck:
Licensee must give 90 days prior notice and disclose all prior art it will rely on
senior officers shall promptly initiate discussions
exclusive licenses may become non-exclusive
if patent is determined to be valid or enforceable or infringed, royalty rates increase
if challenge succeeds, continue to pay royalties at new rate
37. 'No challenges to IP': continued Micromet Nycomed
Micromet may terminate Agreement if Nycomed challenges any patent
If Nycomed challenges sublicensed patents, Micromet may terminate the sublicensed technology
Licensor’s right to terminate for challenge to be passed through in Nycomed’s sublicenses; if not exercised, Micromet may terminate head license 6.8.1 Termination on Patent Challenge. Micromet shall be permitted to terminate this Agreement by written notice effective upon receipt if Nycomed or its Affiliates directly, or indirectly through assistance granted to a Third Party, commence any interference or opposition proceeding, challenge the validity or enforceability of, or oppose any extension of or the grant of a supplementary protection certificate with respect to, any Patent within the Licensed Technology (other than the Sublicensed Patents and the Sublicensed Know-How) (each such action a “Patent Challenge”).
6.8.2 Patent Challenge on Sublicensed Patents. Before commencing any interference or opposition proceeding, challenging the validity or enforceability of, or opposing any extension of or the grant of a supplementary protection certificate with respect to any Sublicensed Patents, Nycomed shall duly consult with Micromet and consider any comments from Micromet in that respect. In particular, Nycomed shall consider consequences of Micromet’s contractual relationships in relation to any such Sublicensed Patents. In the event that Nycomed either directly or indirectly commences any such proceeding for any Patent covered by an Upstream Agreement over the objections of Micromet, then Micromet may immediately terminate the license to Nycomed under Section 6.1 as to any Sublicensed Technology under such applicable Upstream Agreement, or to the extent permitted under the applicable Upstream Agreement, with respect to the Sublicensed Patent that is the subject of such Patent Challenge.
6.8.3 Sublicensees. Nycomed shall include provisions in all agreements granting sublicenses of Nycomed’s rights hereunder providing that if the sublicensee or its Affiliates undertake a Patent Challenge with respect to any Patent within the Licensed Technology under which the sublicensee is sublicensed, Nycomed shall be permitted to terminate such sublicense agreement. If a sublicensee of Nycomed (or an Affiliate of such sublicensee) undertakes a Patent Challenge of any such Patent under which such sublicensee is sublicensed, then Nycomed upon receipt of notice from Micromet of such Patent Challenge shall terminate the applicable sublicense agreement. If Nycomed fails to so terminate such sublicense agreement, Micromet may terminate this Agreement.
6.8.1 Termination on Patent Challenge. Micromet shall be permitted to terminate this Agreement by written notice effective upon receipt if Nycomed or its Affiliates directly, or indirectly through assistance granted to a Third Party, commence any interference or opposition proceeding, challenge the validity or enforceability of, or oppose any extension of or the grant of a supplementary protection certificate with respect to, any Patent within the Licensed Technology (other than the Sublicensed Patents and the Sublicensed Know-How) (each such action a “Patent Challenge”).
6.8.2 Patent Challenge on Sublicensed Patents. Before commencing any interference or opposition proceeding, challenging the validity or enforceability of, or opposing any extension of or the grant of a supplementary protection certificate with respect to any Sublicensed Patents, Nycomed shall duly consult with Micromet and consider any comments from Micromet in that respect. In particular, Nycomed shall consider consequences of Micromet’s contractual relationships in relation to any such Sublicensed Patents. In the event that Nycomed either directly or indirectly commences any such proceeding for any Patent covered by an Upstream Agreement over the objections of Micromet, then Micromet may immediately terminate the license to Nycomed under Section 6.1 as to any Sublicensed Technology under such applicable Upstream Agreement, or to the extent permitted under the applicable Upstream Agreement, with respect to the Sublicensed Patent that is the subject of such Patent Challenge.
6.8.3 Sublicensees. Nycomed shall include provisions in all agreements granting sublicenses of Nycomed’s rights hereunder providing that if the sublicensee or its Affiliates undertake a Patent Challenge with respect to any Patent within the Licensed Technology under which the sublicensee is sublicensed, Nycomed shall be permitted to terminate such sublicense agreement. If a sublicensee of Nycomed (or an Affiliate of such sublicensee) undertakes a Patent Challenge of any such Patent under which such sublicensee is sublicensed, then Nycomed upon receipt of notice from Micromet of such Patent Challenge shall terminate the applicable sublicense agreement. If Nycomed fails to so terminate such sublicense agreement, Micromet may terminate this Agreement.
38. Royalties that 'survive' the patent: longer of the life of the patent and (usually) 10 years
15 years Archemix Merck;
12 years Epix GlaxoSmithKline
while regulatory exclusivity in effect
Adnexus BMS
Isis BMS
ZymoGenetics Bayer Most agreements redact the royalty term or disclose 10 years
Adnexus BMS: 1.70 “Regulatory Exclusivity Period” shall mean any period of data, market or other regulatory exclusivity (other than supplementary protection certificates, which shall be treated as Patents hereunder), including any such periods under national implementations in the European Union of Section 10.1(a)(iii) of Directive 2001/EC/83 and all international equivalents.
Isis BMS: Data Exclusivity and as per Orange Book Listings
ZymoGenetics Bayer: “exclusivity rights to Licensed Product that may be granted or provided for under regulatory laws of certain of the countries in the Bayer Territory”
Most agreements redact the royalty term or disclose 10 years
Adnexus BMS: 1.70 “Regulatory Exclusivity Period” shall mean any period of data, market or other regulatory exclusivity (other than supplementary protection certificates, which shall be treated as Patents hereunder), including any such periods under national implementations in the European Union of Section 10.1(a)(iii) of Directive 2001/EC/83 and all international equivalents.
Isis BMS: Data Exclusivity and as per Orange Book Listings
ZymoGenetics Bayer: “exclusivity rights to Licensed Product that may be granted or provided for under regulatory laws of certain of the countries in the Bayer Territory”
39. Summary co-development deals and options on the rise
biotechs retaining more marketing rights, but little decision-making authority
profit sharing development deal is giving way to deals exploiting options
approaches to ‘no challenges to IP’ developing quickly
40. For an electronic copy of today’s presentation and the full text of all background licenses, please contact:
James Hatton Farris, Vaughan, Wills & Murphy LLP jhatton@farris.com
or visit:
http://del.icio.us/JamesHatton; orwww.jameshatton.com/public