1. Research & Development |
| A. Scope of the Agreement: |
Recombinant human Insulin & improvements.
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| B. Research Period: |
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| C. Cost Sharing & Reimbursement Basis: |
$___ (CON) pre-set amount as "Research Fee".
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| D. Upfront Payment: |  |
(Included in Research Fee).
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| E. Benchmark Amounts: |
Four benchmarks (all dollar payments CON):
1) _____ CON;
2) Delivery of rInsulin by _____ (date CON);
3) Production technology for _____ (quantity CON) by _____ (date CON);
4) Production technology for _____ (quantity CON) by _____ (date CON).
Should Genentech fail to meet any of the benchmarks by the prescribed time, then Lilly's later acceptance of such delivery shall be at Lilly's option; however, should Lilly elect to accept delivery (or otherwise obtain the criteria associated with a benchmark using a Genentech microorganism), then Lilly shall make the payment associated with such benchmark.
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| F. Technology Acquisition Fees: |
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| G. Payment Schedule: | |
Research Fee and Benchmarks only.
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| H. Budgets: | |
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| I. Reimbursement Start Date: |
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| J. Regulatory Filings: | |
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| K. Special Capital Requirements |
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| L. Patent Ownership: | |
Each party shall own its own patents; joint patents shall be owned jointly.
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| M. Patent Filing Costs: | |
Foreign application costs shall be borne by Lilly, following a joint determination where and how broadly to file. Such payments shall be credited to Lilly's royalty obligations.
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| N. Patent Defense Costs: |
Genentech shall have the first opportunity to defend its patents at its sole expense, with recoveries to be divided (after deduction of expenses) "appropriately" by the parties.
If Genentech chooses not to defend its patents, Lilly shall have the right to do so, at its sole expense, and with recoveries to be divided (after deduction of expenses) in accordance with the "relative monetary benefit" to the parties (i.e. royalty-equivalent to Genentech).
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| O. 3rd-Party Patents: | |
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| P. Non-Compete Provisions: |
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| Q. Publications: | |
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| R. Core Technology: | |
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| S. Cancellation Amounts: |
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| T. Termination: | |
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| U. Product Reversion: | |
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| V. Change in Control: | |
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| W. Options/Other: | |
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2. Product License(s) |
| A. License Holder/Type: |
Exclusive worldwide license to use, produce and sell recombinant human insulin.
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| B. Product Field of Use: | |
Recombinant human insulin for therapeutic purposes.
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| C. Territory Splits: | |
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| D. Royalty Rate: | |
8% on Net Sales by Lilly, its subsidiaries and sublicensees (per 7/80 Amendment).
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| E. Right to Sublicense: | |
Yes; per Lilly consent decree with the FTC (as reflected in 5/80 and 7/80 Amendments), Lilly shall grant sublicenses to all "qualified applicants," where such are defined by criteria listed in the FTC decree.
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| F. Term/Patent Life: | |
Lilly may terminate by country or entirely if notifies Genentech upon filing for government approval of recombinant insulin products derived from non-Genentech materials; otherwise CON.
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| G. Adv/Min Royalty & Diligence Requirement | |
Yes; beginning with first year of commercial sale (amounts CON).
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| H. Royalty Accounting: | |
Royalties payable quarterly
Genentech shall have the right to audit at its own expense.
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| I. Patent-Royalty Tie-In: | |
Yes, with respect to minimum royalties only (amounts/percentages CON).
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| J. Options/Other: | |
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3. Manufacturing & Supply |
| A. Right Holder/Type: | |
Lilly shall make all product.
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| B. Bulk/Dosage Form: | |
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| C. Territory: | |
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| D. Reimbursement Basis: |
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| E. Proc. Dev. Terms: | |
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| F. Clinical Use Manufacturing: |
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| G. Shipment Terms: | |
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| H. Financing: | |
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| I. Escape Clause: | |
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| J. Product Liability: | |
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| K. Options/Other: | |
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4. Collaboration Management |
| A. Representation: | |
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| B. Quorum: | |
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| C. Basis of Actions: | |
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| D. Meetings: | |
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| E. Disagreements: | |
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| F. Buyout/Windup: | |
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| G. Options/Other: | |
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5. Equity Investment |
| A. Type of Security: | |
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| B. Pricing: | |
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| C. Board Seat: | |
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| D. Research Tie-Ins: | |
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| E. Options & Rights: | |
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6. Signatories |
| A. For Drug Company: | |
Cornelius W. Pettinga
Executive Vice President
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| B. For Biotech Company: |
Robert A. Swanson
President
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