Research, License And Collaboration Agreement

Exhibit 10.11


RESEARCH, LICENSE AND COLLABORATION AGREEMENT


BETWEEN


CELLTECH R & D LIMITED


AND


NEOGENESIS DRUG DISCOVERY, INC.


DATED JULY 11, 2001


* = CONFIDENTIAL TREATMENT REQUESTED: MATERIAL HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE COMMISSION.


TABLE OF CONTENTS


PAGE
---- ARTICLE I. DEFINITIONS.............................................................................1
Section 1.1. AAA...........................................................................2
Section 1.2. AFFILIATE.....................................................................2
Section 1.3. AGREEMENT.....................................................................2
Section 1.4. ALIS..........................................................................2
Section 1.5. APPLICABLE LAWS...............................................................2
Section 1.6. APPROVAL LETTER...............................................................2
Section 1.7. APPROVED TARGET(S)............................................................2
Section 1.8. APPROVED TARGET EXCLUSIVITY PERIOD............................................2
Section 1.9. CELLTECH INDEMNIFIED PARTY....................................................3
Section 1.10. CELLTECH TECHNOLOGY..........................................................3
Section 1.11. CELLTECH DERIVATIVES.........................................................3
Section 1.12. CIP..........................................................................3
Section 1.13. COMMERCIALIZATION............................................................3
Section 1.14. COMMERCIALLY REASONABLE EFFORTS..............................................3
Section 1.15. CONFIDENTIAL INFORMATION.....................................................4
Section 1.16. CONTROL OR CONTROLLED........................................................4
Section 1.17. DESIGNATED COMPOUND..........................................................4
Section 1.18. DISCLOSING PARTY.............................................................4
Section 1.19. EFFECTIVE DATE...............................................................4
Section 1.20. FDA..........................................................................4
Section 1.21. FD&C ACT.....................................................................4
Section 1.22. FIRST COMMERCIAL SALE........................................................4
Section 1.23. FOB..........................................................................5
Section 1.24. FORCE MAJEURE................................................................5
Section 1.25. FTE..........................................................................5
Section 1.26. GOOD CLINICAL PRACTICE.......................................................5
Section 1.27. GOOD LABORATORY PRACTICE.....................................................5
Section 1.28. GOOD MANUFACTURING PRACTICE..................................................5
Section 1.29. INDEMNIFIED PARTY(IES).......................................................6
Section 1.30. INDEMNIFYING PARTY...........................................................6
Section 1.31. KNOW-HOW.....................................................................6
Section 1.32. LICENSED PRODUCT(S)..........................................................6
Section 1.33. LOCK UP PERIOD...............................................................6
Section 1.34. MAJOR COUNTRY................................................................6
Section 1.35. MANUFACTURING................................................................6
Section 1.36. MASK.........................................................................6
Section 1.37. NDA..........................................................................7


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Section 1.38. NEOGENESIS INDEMNIFIED PARTY(IES)............................................7
Section 1.39. NEOGENESIS TARGET............................................................7
Section 1.40. NEOGENESIS TECHNOLOGY........................................................7
Section 1.41. NEOGENESIS DERIVATIVES.......................................................7
Section 1.42. NEOMORPH CHEMISTRY...........................................................7
Section 1.43. NEOMORPH FOCUSED LIBRARIES...................................................7
Section 1.44. NEOMORPH SCREENING LIBRARY...................................................7
Section 1.45. NET SALES....................................................................7
Section 1.46. PATENTS......................................................................8
Section 1.47. PERSON.......................................................................9
Section 1.48. PHASE I CLINICAL TRIALS......................................................9
Section 1.49. PHASE III CLINICAL TRIALS....................................................9
Section 1.50. PRELIMINARY COMPOUND.........................................................9
Section 1.51. PRELIMINARY COMPOUND EXCLUSIVITY PERIOD......................................9
Section 1.52. PRIMARY ACTIVE COMPOUND......................................................9
Section 1.53. PRIMARY ACTIVE COMPOUND EXCLUSIVITY PERIOD...................................9
Section 1.54. PROGRAM TECHNOLOGY...........................................................9
Section 1.55. PROPRIETARY TARGET...........................................................10
Section 1.56. PUBLIC TARGET................................................................10
Section 1.57. QSCD.........................................................................10
Section 1.58. QSCD PRELIMINARY COMPOUNDS...................................................10
Section 1.59. QSCD PRIMARY ACTIVE COMPOUNDS................................................10
Section 1.60. QUARTER......................................................................10
Section 1.61. R&D PROGRAM..................................................................10
Section 1.62. RECEIVING PARTY..............................................................10
Section 1.63. REGULATORY APPROVALS.........................................................10
Section 1.64. REGULATORY AUTHORITY.........................................................11
Section 1.65. RESEARCH COLLABORATION.......................................................11
Section 1.66. RESEARCH COLLABORATION PLAN..................................................11
Section 1.67. RESEARCH TERM................................................................11
Section 1.68. STEERING COMMITTEE...........................................................11
Section 1.69. STOCK PURCHASE AGREEMENT.....................................................11
Section 1.70. TARGET.......................................................................11
Section 1.71. TARGET GUIDELINES............................................................11
Section 1.72. TERM.........................................................................11
Section 1.73. TERRITORY....................................................................11
Section 1.74. THIRD PARTY (THIRD PARTIES)..................................................12
Section 1.75. THIRD PARTY CLAIM............................................................12


ARTICLE II. GRANT, RIGHTS AND RESTRICTIONS.........................................................12
Section 2.1. GRANT OF RESEARCH LICENSE.....................................................12
Section 2.2. NEOGENESIS GRANT OF LICENSE...................................................12
Section 2.3. RETAINED RIGHTS...............................................................13


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ARTICLE III. RESEARCH COLLABORATION PLAN...........................................................13
Section 3.1. DILIGENCE.....................................................................13
Section 3.2. RESEARCH COLLABORATION........................................................13
Section 3.3. NUMBER OF TARGETS.............................................................13


ARTICLE IV. STEERING COMMITTEE.....................................................................14
Section 4.1. STEERING COMMITTEE............................................................14
(a) STEERING COMMITTEE ACTIVITIES.................................................14
(b) STEERING COMMITTEE MEETINGS...................................................14
(c) STEERING COMMITTEE GOVERNANCE.................................................15


ARTICLE V. RESEARCH FUNDING........................................................................15
Section 5.1. RESEARCH COLLABORATION FUNDING................................................15
(a) STOCK PURCHASE................................................................15
(b) FTE FUNDING...................................................................15
(c) QUARTERLY PAYMENTS............................................................16


ARTICLE VI. MILESTONES AND ROYALTY PAYMENTS........................................................16
Section 6.1. MILESTONES....................................................................16
(a) PHASE I.......................................................................16
(b) PHASE III.....................................................................16
(c) APPROVAL LETTER...............................................................16
(d) MILESTONE FREQUENCY...........................................................17
Section 6.2. ROYALTIES.....................................................................17
(a) NON-QSCD DISCOVERED COMPOUNDS.................................................17
(b) QSCD DISCOVERED COMPOUNDS.....................................................17
(c) ROYALTY PAYMENTS AND TERM.....................................................17
(d) ROYALTY ADJUSTMENTS...........................................................18
Section 6.3. REMITTANCE....................................................................18
(a) FUNDS/EXCHANGE RATE...........................................................18
(b) INTEREST......................................................................18
Section 6.4. RECORDS.......................................................................18
Section 6.5. INSPECTION....................................................................19
(a) AUDIT.........................................................................19
(b) DISPUTES......................................................................19
Section 6.6. TAXES.........................................................................19


ARTICLE VII. REGULATORY AND MARKETING OBLIGATIONS..................................................20
Section 7.1. PRODUCT DEVELOPMENT...........................................................20


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Section 7.2. MANUFACTURE OF PRODUCT........................................................20
Section 7.3. REGULATORY MATTERS............................................................20
Section 7.4. MARKETING AND SALE............................................................20
(a) RESPONSIBILITY................................................................20
(b) MARKING.......................................................................20
(c) THIRD PARTY LICENSES..........................................................21
Section 7.5. PERIODIC REVIEW...............................................................21


ARTICLE VIII. RIGHTS IN TECHNOLOGY, PATENTS AND KNOW-HOW...........................................21
Section 8.1. OWNERSHIP OF PROGRAM TECHNOLOGY...............................................21
(a) CELLTECH OWNED PROGRAM TECHNOLOGY.............................................21
(b) NEOGENESIS OWNED PROGRAM TECHNOLOGY...........................................22
(c) JOINTLY OWNED PROGRAM TECHNOLOGY..............................................22
Section 8.2. DISCLOSURE BY EMPLOYEES, AGENTS OR INDEPENDENT CONTRACTORS....................22
Section 8.3. PATENT PROSECUTION AND RELATED ACTIVITIES.....................................23
(a) NEOGENESIS OWNED PROGRAM TECHNOLOGY...........................................23
(b) CELLTECH OWNED PROGRAM TECHNOLOGY.............................................23
(c) JOINTLY OWNED PROGRAM TECHNOLOGY..............................................24
(d) COOPERATION...................................................................24
Section 8.4. THIRD PARTY INFRINGEMENT......................................................24
(a) ENFORCEMENT...................................................................24
(b) FAILURE TO ENFORCE............................................................25
(c) DIVISION OF RECOVERIES........................................................25
(d) COOPERATION...................................................................26
Section 8.5. INFRINGEMENT CLAIMS BY THIRD PARTIES..........................................26
(a) THIRD PARTY CLAIMS............................................................26
(b) RESPONSE TO THIRD PARTY CLAIMS................................................26


ARTICLE IX. CONFIDENTIALITY.........................................................................27
Section 9.1. CONFIDENTIALITY...............................................................27
Section 9.2. OBLIGATIONS OF CONFIDENTIALITY................................................27
Section 9.3. LEGAL DISCLOSURE..............................................................27
Section 9.4. OWNERSHIP OF INFORMATION......................................................28
Section 9.5. EXPIRATION OR TERMINATION.....................................................28
Section 9.6. PUBLICITY.....................................................................29
Section 9.7. PUBLICATION...................................................................29


ARTICLE X. REPRESENTATIONS AND WARRANTIES..........................................................30
Section 10.1. NEOGENESIS REPRESENTATIONS AND WARRANTIES....................................30
(a) ORGANIZATION..................................................................30
(b) AUTHORITY.....................................................................30
(c) GOVERNMENTAL CONSENTS.........................................................30
(d) NO CONFLICT WITH OTHER AGREEMENTS.............................................30
(e) PATENT INFRINGEMENT...........................................................31
(f) DEBARRED......................................................................31
(g) DISCLAIMER....................................................................31


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Section 10.2. CELLTECH REPRESENTATIONS AND WARRANTIES......................................31
(a) ORGANIZATION..................................................................31
(b) AUTHORITY.....................................................................32
(c) GOVERNMENTAL CONSENTS.........................................................32
(d) NO CONFLICT WITH OTHER AGREEMENTS.............................................32
(e) DISCLAIMER....................................................................32


ARTICLE XI. INDEMNIFICATION.........................................................................33
Section 11.0. LIMITATION OF LIABILITY......................................................33
Section 11.1. INFRINGEMENT INDEMNIFICATION.................................................33
(a) NEOGENESIS....................................................................33
(b) CELLTECH......................................................................34
Section 11.2. OTHER CLAIMS.................................................................34
(a) NEOGENESIS....................................................................34
(b) CELLTECH......................................................................34
Section 11.3. PROCEDURE....................................................................35


ARTICLE XII. TERM AND TERMINATION..................................................................35
Section 12.1. TERM.........................................................................35
Section 12.2. TERMINATION..................................................................36
(a) MATERIAL BREACH...............................................................36
(b) BANKRUPTCY OR RECEIVERSHIP OF A PARTY.........................................36
(c) TERMINATION BY CELLTECH.......................................................36
Section 12.3. EFFECT OF TERMINATION........................................................36
(a) TERMINATION ACTIVITIES........................................................36
(b) RETURN OF CONFIDENTIAL INFORMATION............................................37
(c) RIGHTS UPON TERMINATION.......................................................37
(d) NO RELEASE OF MATURED OBLIGATION..............................................37
Section 12.4 SURVIVAL......................................................................37


ARTICLE XIII. GENERAL PROVISIONS...................................................................38
Section 13.1. ISSUE RESOLUTION.............................................................38
(a) NOTIFICATION OF DISPUTE.......................................................38
(b) LIMITATIONS...................................................................38
(c) ARBITRATION RULES.............................................................38
(d) APPLICABLE LAW................................................................39
(e) RESTRICTIONS ON DAMAGES.......................................................39
Section 13.2. GOVERNING LAW................................................................39
Section 13.3. AMENDMENT AND WAIVER.........................................................40
Section 13.4. INDEPENDENT CONTRACTORS......................................................40
Section 13.5. ASSIGNMENT...................................................................40
Section 13.6. SUCCESSORS AND ASSIGNS.......................................................41
Section 13.7. NOTICES......................................................................41
Section 13.8. SEVERABILITY.................................................................41


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Section 13.9. CAPTIONS.....................................................................41
Section 13.10. WORD MEANINGS...............................................................41
Section 13.11. ENTIRE AGREEMENT............................................................41
Section 13.12. RULES OF CONSTRUCTION.......................................................42
Section 13.13. COUNTERPARTS................................................................42
Section 13.14. FORCE MAJEURE...............................................................42
Section 13.15. FURTHER ASSURANCES..........................................................42


EXHIBIT A...........................................................................................A-1


EXHIBIT B...........................................................................................B-1


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RESEARCH, LICENSE AND COLLABORATION AGREEMENT


This Research, License and Collaboration Agreement (the "Agreement") is entered into as of July 11, 2001 ("Effective Date") by and between Celltech R & D Limited whose registered office is situate at 208 Bath Road, Slough, Berkshire SL1 3WE, England ("Celltech") and NeoGenesis Drug Discovery, Inc., having an address of 840 Memorial Drive, Cambridge, MA 02139, USA ("NeoGenesis"). Each of Celltech and NeoGenesis may individually be referred to as a "Party" and collectively as "Parties".


WHEREAS, Celltech is a biopharmaceutical company with an ongoing interest in research, development and commercialization of pharmaceutical products for treatment of certain human diseases and wishes to identify compounds that exhibit a high affinity and functional activity to protein targets for the development, manufacture and commercialization of pharmaceutical products;


WHEREAS, NeoGenesis is a chemical genomics based drug discovery company and has certain technology and know-how, including screening processes of libraries of mass-encoded small molecule compounds built around an expanding set of diverse cores, relating to the identification, discovery, validation and optimization of chemical compounds that exhibit a high affinity to protein targets useful for development of pharmaceutical products;


WHEREAS, Celltech has certain technology and know-how relating to the identification of protein targets implicated in disease;


WHEREAS, Celltech and NeoGenesis desire to jointly collaborate in research to identify compounds from NeoGenesis' libraries that exhibit high affinity and functional activity to specific protein targets provided by Celltech;


NOW THEREFORE, in consideration of the mutual covenants and promises contained in this Agreement, Celltech and NeoGenesis agree as follows:


ARTICLE I.
DEFINITIONS


Capitalized terms used in this Agreement and not otherwise defined herein shall have the meaning set forth below.


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SECTION 1.1. AAA shall have the meaning set forth in Section 13.1 (c) hereof.


SECTION 1.2. AFFILIATE shall mean with respect to either Party, any Person that, directly or indirectly, is controlled by, controls or is under common control with such Party. For purposes of this definition, control means, with respect to any Person, the direct or indirect ownership of more than [*] of the voting or income interest in such Person or the possession otherwise, directly or indirectly, of the power to direct the management or policies of such Person.


SECTION 1.3. AGREEMENT shall mean this Research, License and Collaboration Agreement and any Exhibits or Schedules appended hereto, as the same may be amended from time to time by the Parties in accordance with Section 3.2 or Section 13.3, as applicable.


SECTION 1.4. ALIS shall mean the Automated Ligand Identification System, an automated, ultra-high throughput ligand selection system proprietary to NeoGenesis that is used to identify multiple classes of chemical compounds against target proteins.


SECTION 1.5. APPLICABLE LAWS shall mean all laws, statutes, regulations and ordinances of any Regulatory Authority, including without limitation the FD&C Act.


SECTION 1.6. APPROVAL LETTER shall have the meaning set forth in Section 6.1(c) hereof.


SECTION 1.7. APPROVED TARGET(S) shall mean any Target that NeoGenesis has approved for entry into the Research Collaboration based on the Target Guidelines.


SECTION 1.8. APPROVED TARGET EXCLUSIVITY PERIOD shall mean the period of time during which NeoGenesis will not approve or screen an Approved Target for a Third Party. For a Public Target and homologs thereof that are [*] homologus at the peptide level such exclusivity period shall begin upon NeoGenesis' approval of such Target as set forth in Exhibit A, paragraph 1(a) or paragraph 1(b) of the Research Collaboration Plan and end [*] thereafter. For a Proprietary Target, such exclusivity period shall begin upon NeoGenesis' approval of such Approved Target as set forth in Exhibit A, paragraph 1(a) or paragraph 1(b) of the Research Collaboration Plan and end as follows: (i) where a patent(s) has issued to Celltech or an Affiliate, in any Major Country in the Territory claiming such target, the exclusivity period shall end when the last of the patent(s) expires, lapses, or is held invalid or


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