Technology License Agreement

COOPERATIVE DEVELOPMENT AGREEMENT


THIS AGREEMENT, entered into as of the 8th day of November, 2002, by and between ALTUS BIOLOGICS INC., a corporation organized and existing under the laws of the State of Delaware and having its principal place of business at 625 Putnam Avenue, Cambridge, MA 02139 (hereinafter called "ALTUS"), and AMANO ENZYME INC., a corporation organized and existing under the laws of Japan and having its principal place of business at 1-2-7, Nishiki, Naka-ku, Nagoya, Japan (hereinafter called "AMANO"),


WITNESSETH:


WHEREAS, ALTUS, through research and development for a long time, acquires and possesses certain valuable technologies pertaining to certain pharmaceutical products known as TheraCLEC(TM) Total and a method for manufacturing such products and continues to develop scientific techniques pertaining to the products, and owns and controls certain patent rights and trademark rights in the products, and


WHEREAS, AMANO has, over the years, demonstrated its expertise in development, manufacturing and worldwide marketing of many kind of enzymes for the commercial markets especially in food industry and pharmaceutical industry, and has thereby established a reputation of high regard in such markets, which reputation is believed by ALTUS to be of great value to the possible success of the joint development contemplated hereunder, and


WHEREAS, AMANO desires to undertake manufacture of enzyme materials to be used in the products of ALTUS,


WHEREAS, ALTUS and AMANO are willing to enter into a cooperative development of certain enzyme materials, which are fit for TheraCLEC(TM) Total, and entire specifications of which are instructed by ALTUS, and


WHEREAS, ALTUS and AMANO propose to decide at the end of Phase II of the U.S. clinical trial process whether they will enter into a further manufacturing agreement.


NOW, THEREFORE, ALTUS and AMANO agree as follows:


ARTICLE 1. DEFINITIONS


1. The term "Products" shall mean the pharmaceutical products known as
TheraCLEC(TM) Total, in a certain preparation form or forms
[********************************] specified, developed, manufactured,
labeled and packaged and sold by or on behalf of ALTUS.


2. The term "Materials" shall mean enzymes used as active ingredients in the
Products, which are made up of selected [***********] and [******] prepared
by AMANO in accordance with Specifications developed and submitted by ALTUS
for use in manufacturing Products.


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 406 of the Securities Act.


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3. The term "Amano Enzymes" shall mean enzymes including but not limited to
[**************] and [********], which are discovered, invented, developed,
produced, sold or otherwise disposed by Amano with its sole technologies
and which are basis of Materials to be develop hereunder.


4. The term "Technical Information" shall mean all of the information and
knowledge now possessed by ALTUS or AMANO and those acquired by ALTUS or
AMANO during the life of this Agreement, which relate to manufacturing
process of Materials -or relate to Products.


5. The term "ALTUS's Development" shall mean any and all works of research and
development made by ALTUS with respect to Materials and Products to be
developed hereunder.


6. The term "AMANO's Development" shall mean any and all works of research and
development made by AMANO with respect to Materials to be developed
hereunder.


7. The term "Joint Development" shall mean any and all technical works of
research and development jointly made by ALTUS and AMANO with respect to
Materials to be developed hereunder.


8. The term "Development" shall mean ALTUS's Development, AMANO's Development
and/or Joint Development.


9. The term "ALTUS's Technologies" shall mean any and all technologies now
possessed by ALTUS and those acquired by ALTUS during the life of this
Agreement.


10. The term "AMANO's Technologies" shall mean any and all technologies now
possessed by AMANO and those acquired by AMANO during the life of this
Agreement.


11. The term "Joint Technologies" shall mean any and all technologies jointly
developed by ALTUS and AMANO as the results of working together during the
life of this Agreement, which relate to manufacturing process of Materials.


12. The term "Patents" shall mean those patents and patent applications which
either party owns or controls or which either party may obtain or both the
parties may jointly obtain hereunder, the application date of which is on
or before the date of this Agreement or during the life of this Agreement,
and all of which are useful for or relating to Materials and/or Products.


13. The term "Specifications" shall mean the written specifications established
for the characteristics, quality and quality control testing procedures for
each of Materials as developed by ALTUS, and as amended or supplemented
from time to time.


14. The term "Good Manufacturing Practices" shall mean good manufacturing
practices as defined in applicable laws, regulations and guidelines.


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 406 of the Securities Act.


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ARTICLE 2. PURPOSES


ALTUS and AMANO shall together and individually make Development toward the goal of successfully manufacturing Materials to be used in Products. ALTUS and AMANO shall exert [************] to successfully complete Development under the terms and conditions of this Agreement.


ARTICLE 3. RESPECTIVE CHARGES OF DEVELOPMENT


1. ALTUS shall take charge of clinical development in the nature and
characteristic of Materials used for the preparation of Products, and
chemical reaction and effect against malabsorption resulting from
pancreatic insufficiency including cystic fibrosis, and carry out such
development at ALTUS's laboratory and AMANO's facility during the life of
this Agreement. In the course of ALTUS's Development, ALTUS shall:


1) develop and establish ALTUS's Technologies utilized in Materials as
bulk drug active for Products,


2) develop and establish the standard of Specifications of Materials to
be manufactured by AMANO and prototype manufacturing processes
therefor,


3) transfer to AMANO Specifications to be employed by AMANO and give
AMANO a technical guidance in the manufacture of Materials,
particularly TheraCLEC [******] and [**************] and [********],


4) inspect and approve AMANO's Development,


5) prepare and realize an Investigational New Drug application ("IND") to
the Food and Drug Administration ("FDA") for Materials and/or
Products,


6) provide assistance to AMANO in establishing Good Manufacturing
Practices, and


7) perfect the regulatory process and retain records pertaining to
development of the Materials and Products.


2. AMANO shall take charge of development in the manufacture of Materials and
carry out such development at AMANO's laboratory during the life of this
Agreement. In the course of AMANO's Development, AMANO shall:


1) arrange production facility located in Japan for Materials, which
meets requirement of Good Manufacturing Practices,


2) establish AMANO's Technologies of [*********************] and
[*************************] for Materials,


3) establish AMANO's Technologies of the [*******] and [****************]
for materials,


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 406 of the Securities Act.


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4) develop technologies manufacturing TheraCLEC [******] and
[*************] and [********] under AMANO's Technologies in
accordance with ALTUS's Technologies disclosed to AMANO,


5) develop AMANO's Technologies of manufacturing Materials in accordance
with Specifications and guidance given by ALTUS, and


6) support the regulatory process and retain records pertaining to
development of the Materials.


3. ALTUS and AMANO shall jointly develop and establish a standard
manufacturing management protocol for Materials on the basis of quality
control procedures originally developed by Altus, that may need to be
modified to fulfill requirements for an FDA regulated product or other
product.


ARTICLE 4. EXCHANGE OF TECHNICAL INFORMATION


Forthwith after the execution of this Agreement, both parties. shall disclose to the other party Technical Information owned and possessed in the respective field of which either party takes charge hereunder from time to time during the life of this Agreement. All Technical Information that was exchanged between or developed jointly by the parties [**********************************] shall be deemed to be information exchanged between or developed jointly by the parties pursuant to this Article 4. All intellectual property provisions in this Agreement shall be effective as of the earliest date that the parties began working together.


ARTICLE 5. SUPPLY OF MATERIALS


1. ALTUS shall provide AMANO with forecasts setting out the amounts of
Materials it expects it will require for each month during the [********]
period from the time of preparation of the relevant forecast. The forecasts
shall be updated [********]. ALTUS shall prepare a separate forecast for
the [**********] required for any [*********************]. Upon ALTUS's
request, AMANO shall supply ALTUS with reasonable quantities of Materials
manufactured by AMANO in accordance with Specifications, regardless of
fully finished or not, be necessary for ALTUS's Development.


2. If ALTUS places an order for Materials with AMANO for the purpose of
ALTUS's Development pursuant to this Agreement that does not exceed the
amount of Materials set forth in the most recent forecast for the relevant
month, AMANO shall [**************************************]; provided,
however, if ALTUS places an order for Materials in excess of the volume
specified in the applicable forecast, supply by AMANO of such excess
Materials shall be subject to [***********************************] and to
[************************************************]. Supply of Materials by
AMANO hereunder may be conducted through AMANO's subsidiary, Amano Enzyme
USA Co., Ltd. based in U. S. A.


3. The parties hereto shall make a supply contract or contracts in accordance
with the terms of this Agreement, on a bona fide basis, from case to case
relating to the supply of Materials as provided hereinabove. The supply
contract shall definitely provide terms


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 406 of the Securities Act.


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and conditions including but not limited to kind of Materials, quantities,
Specifications, time of shipment, trade terms, price, payment and etc.


4. AMANO shall not supply [**************] other than to ALTUS without prior
written consent from ALTUS except as otherwise provided in Article 12.3,
provided that nothing herein contains any restriction of supplying other
party than ALTUS with any of Amano Enzymes or materials manufactured
[***************************************] and/or other technologies of any
third party.


5. Being understood that evaluate, use or application of Materials and
Specifications for medical products are decided by ALTUS at its sole
discretion, AMANO shall incur [*********] on Materials supplied hereunder,
[**********] (a) all or any consequential or indirect losses or damages or
loss of profit suffered or incurred by ALTUS or any third party howsoever
caused; or (b) all or any actions, proceedings, demands or claims made
against ALTUS or any third party by any person whatsoever, provided AMANO
prepares the Materials in accordance with the Specifications and Good
Manufacturing Practices. ALTUS shall indemnify and hold AMANO harmless from
[********************] arising out of or related to [*********************
************************************], provided AMANO prepares the
Materials in accordance with [******************************************].
ALTUS halt obtain and maintain, at its own expense, during the life of this
Agreement and thereafter, [********] insurance covering product liability,
tort liability and other liability relating to Materials and Products
written by an insurer satisfactory to AMANO and [*************
**************************************].


ARTICLE 6. JOINT DEVELOPMENT COMMITTEE


1. ALTUS and AMANO shall, within [**********] after the execution of this
Agreement, establish a Joint Development Committee ("JDC") to (a) elaborate
and confirm the plan of Development contemplated herein; (b) give each
other the progress condition of Development at the time of the meeting; (c)
oversee the compliance of the facility with Good Manufacturing Practices
and the transfer of the prototype process of manufacturing Materials from
ALTUS to AMANO; (d) coordinate Development to the manufacturing process of
Materials; and (e) to exercise decision making authority, and, further,
shall make the plan and schedule of Development within [**********] after
the first meeting of JDC.


2. The JDC shall be comprised of [*****] ALTUS representatives and [*****]
AMANO representatives, who will initially be the business and technical
mangers. Each party may replace its JDC representative at any time, after
discussion with the other party, with subsequent written notice to the
other party.


3. Decisions of the JDC shall be made by consensus approval. In the event the
parties are unable to agree on any issue, the dispute will be referred to
the President or a person designated by the President of each party, who
shall promptly meet in person or by means of telephone or video conference
and endeavor to resolve the dispute in a timely manner.


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 406 of the Securities Act.


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In the event such individuals are unable to resolve the dispute, it shall
be settled by [*******************], or as otherwise agreed.


4. On and after the execution of this Agreement, the JDC shall meet at least
quarterly at regular intervals, or more often as agreed by the parties, in
person at such locations as the parties agree, or by means of telephone or
video conference. With the consent of the parties, other representatives of
each party may attend JDC meetings as nonvoting observers.


5. Each party shall each bear the expenses of their respective JDC members
related to their participation on the JDC and attendance at JDC meetings.


ARTICLE 7. EXPENSES


1. Each party hereto shall [*************************], including but not
limited to, the [**************] in its laboratory
[***********************] for Development from time to time, and such party
[***********************************************].


2. During ALTUS's stay in Japan for Development, ALTUS may, [***************],
use all equipment in AMANO's laboratory, which are necessary for
Development, and, during AMANO's stay in U.S.A. for Development, AMANO may,
[****************], use all equipment in ALTUS's laboratory, which are
necessary for Development.


3. Each party hereto [**********************], including but not limited to,
[**********************] from U.S.A. to Japan and back, [*****************
*********************************], which would be incurred on ALTUS or
AMANO under this Agreement.


ARTICLE 8. PATENTS AND ETC.


1. Subject to Article 8(4) below, Patents and/or other industrial property
rights, inventions, discoveries, know-how and other technologies
(collectively, "Intellectual Property Rights") solely developed, acquired
or owned by either party during the life of this Agreement [***************
*******************************************************************]
Patents and/or other industrial property rights, inventions, discoveries,
know-how and other technologies in any country without a prior written
consent of such party.


2. Each party [*****************************************] of Patents and/or
other Intellectual Property Rights concerning all discoveries, inventions
and/or other technologies acquired by such party in the course of or as the
result of Development. The [***************] of such Intellectual Property
Rights [******************] shall be ALTUS or AMANO and [*****************
****************************] for such Patents and/or other Industrial
Property Rights [***************************].


3. Each party [****************] for its own Intellectual Property Rights
[***********************].


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company's application requesting confidential treatment under Rule 406 of the Securities Act.


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4. All Intellectual Property Rights which constitute Joint Technologies
[**********************************]. As to Joint Technologies resulted
from Joint Development, Intellectual Property Rights for such Joint
Technologies [************************], in Japan an ...