Distributor And Product Services Agreement

Exhibit 10.27


DISTRIBUTOR AND PRODUCT SERVICES AGREEMENT*


Dated March 13, 1998


Between


ALTERNATE SITE DISTRIBUTORS, INC.
d.b.a. BERGEN BRUNSWIG SPECIALTY COMPANY


and


IMMUNOMEDICS, INC.


___________


* Confidential portions omitted and filed separately with the Securities
and Exchange Commission.


DISTRIBUTOR AND PRODUCT
SERVICES AGREEMENT


This Distributor and Product Services Agreement ("Agreement") made this 13th day of March, 1998 by and between ALTERNATE SITE DISTRIBUTORS, INC. d.b.a. BERGEN BRUNSWIG SPECIALTY COMPANY ("BBSC") and IMMUNOMEDICS, INC. ("IMMU").


RECITALS


A. IMMU is a biopharmaceutical Company that manufactures and sells pharmaceutical products including CEA-Scan(R) (the "Product") which has U.S.F.D.A. approval for human use.


B. BBSC is in the business of providing distribution and product service support services to drug manufacturers and other sectors of the healthcare industry.


C. IMMU desires to engage BBSC to provide product support services including Distribution Services, Order Management and Customer Services for the Product and such other IMMU products as the parties may agree from time to time to add by addendum hereto.


NOW THEREFORE, for good and valuable consideration the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:


1. Appointment


1.1 IMMU hereby appoints BBSC as its non-exclusive distributor of Product in the U.S.A. and the U.S. territories. BBSC represents and warrants that it has the facilities and personnel necessary to satisfactorily and timely perform the services to be provided by it under this Agreement.


1.2 IMMU hereby engages BBSC to provide the services described in the Agreement for the fees listed in Schedule "A" attached hereto and by this reference made a part hereof.


2. Distribution Services


For the fees listed in Schedule "A", BBSC will provide the following services:


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2.1 Order Process Management.


BBSC will provide customer service representatives to perform the following order process management activities.


2.1.1 staffing during normal customer service hours (8:00 a.m. CT to 6:00 p.m. CT) including a live operator greeting;


2.1.2 management of inbound telephone calls, faxes and EDI transmissions relating to ordering, marketing and distribution;


2.1.3 twenty-four (24) hour availability in an integrated voicemail pager service seven (7) days per week;


2.1.4 new account processing, including credit verification; and


2.1.5 coordinating inquiries regarding technical, clinical and medical issues and referring directly to IMMU to assure an appropriate response by IMMU.


2.2 Distribution/Warehousing.


BBSC will provide distribution and warehousing services to IMMU for IMMU's national accounts and IMMU's independent accounts as defined below:


2.2.1 IMMU's national accounts shall mean [*] and, on [*] days notice to BBSC, any other entities which IMMU may designate from time to time ("National Accounts") including, without limitation, any multi-site organization desiring to enter into a supply agreement with IMMU and meeting IMMU's requirements therefor.


2.2.2 IMMU's independent accounts shall mean hospital, clinic and independent pharmacy customers of IMMU and all other IMMU customers not designated as National Accounts ("Independent Accounts").


2.2.3 For National Accounts BBSC will provide the following distribution and warehouse services as consignee of the Product:


2.2.3.1 Acceptance of orders from IMMU or direct from the National Account, as designated by IMMU, in "lot" quantities of [*] doses/lot or greater.


2.2.3.2 Packaging and shipping of the designated quantity to the National Account, to that account's central warehouse, or on request, and for


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an additional fee to be billed to the National Account, drop shipped to individual pharmacies.


2.2.3.3 Submission of orders, associated documentation (including manufacturing lot numbers and shipping information) and inventory status on a daily basis by fax or electronic transmission.


2.2.3.4 Maintenance of the database required to facilitate a recall, in accordance with FDA guidelines and requirements should that ever become necessary.


2.2.4 For Independent Accounts, BBSC will provide the following distribution and warehouse services as the purchaser and subsequent owner of the Product:


2.2.4.1 Reception of incoming orders, either direct or through an IMMU-to-BBSC "tie line".


2.2.4.2 Purchasing from IMMU the doses required to meet those orders on a timely basis.


2.2.4.3 Packaging and shipping ordered doses to the Independent Accounts.


2.2.4.4 Maintenance of the database required to facilitate a recall, in accordance with FDA guidelines and requirements should that ever become necessary.


2.2.4.5 Billing and collection of these Independent Accounts.


2.2.4.6 Transmission of weekly and monthly sales reports, by account, to IMMU.


2.2.5 For both National Accounts and Independent Accounts, BBSC will warehouse and inventory the Product at BBSC's distribution facility at [*] (the "BBSC Facility"). Product that has met all regulatory product release requirements will be received, and placed into inventory for distribution. BBSC and IMMU will comply with all FDA regulations including product lot record retention. Distribution and warehousing services include the following:


2.2.5.1 Continuous inventory maintenance;


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2.2.5.2 Invoicing Independent Accounts on BBSC invoice stock;


2.2.5.3 Shipment tracking;


2.2.5.4 Security costs;


2.2.5.5 Drop shipments; and


2.2.5.6 Shipment of outdated/damaged goods to site of disposal in accordance with the FDA regulations.


IMMU will pay all costs, expenses, insurance, and import duties, if any, for delivery of all Product to the BBSC facility. BBSC will visually inspect each shipment of Product for external container or package damage or loss in transit (based upon records provided to BBSC from IMMU). Contingent upon BBSC receiving the appropriate records to enable batch verification, BBSC shall notify IMMU when damage or loss has occurred within three business days of receipt of Product by BBSC. BBSC will store and ship all Product in compliance with good manufacturing practice guidelines and other FDA requirements. BBSC will store Product at 2(degree) to 8(degree) centigrade at all times.


Upon receipt of the order transmission from customer service Product will be shipped in regulatory compliant refrigerated shippers (which will be directed to maintain the required temperature). Orders received by [*] will be shipped the [*]. Products will be distributed on an FEFO (first expired, first out) basis.


2.3 Emergency Deliveries. In emergencies Product will be shipped same day if necessary and costs will be passed through to the customer.


3. Data Management and Reporting (Key Program Activity and
Management Reports)


The following types of reports will be available to IMMU for the fees listed in Schedule "A" attached hereto:


3.1 transmission of daily sales by unit and dollars


3.2 sales reports by territory/region


3.3 inventory reports


3.4 credits


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3.5 new accounts


3.6 chargeback, rebate data


3.7 program utilization data including call volume, type of caller and reason for inquiry down to the state level and/or sales territory level


IMMU and BBSC will jointly determine the types of reports, data elements and formats, and the frequency of reports that will be required to provide key management and program oversight information. MMU shall receive up to [*] of the above standard reports without additional charge. There will be additional charges for any further reports requested, based upon programming charges.


4. Recalls


4.1 In the event that it becomes necessary to conduct a recall, market withdrawal or field correction (a "Recall") of any Product, IMMU shall conduct the Recall and shall have primary responsibility therefor, and BBSC shall cooperate with IMMU in recalling any affected Product. If the Recall was due to the acts or omissions of IMMU, then IMMU shall pay or reimburse, as the case may be, all of BBSC's direct out-of-pocket expenses, including but not limited to any reasonable attorney's fees and expenses, incurred by BBSC in connection with performing any such Recall. If the Recall was due to the acts or omissions of BBSC then BBSC shall pay or reimburse, as the case may be, all of IMMU's direct out-of-pocket expenses, including but not limited to any reasonable attorneys fees or expenses, incurred by IMMU in connection with performing any such Recall. Each of the parties shall use its reasonable best efforts to minimize the expenses of Recall when it occurs. IMMU shall inform BBSC of the proposed Recall within forty-eight (48) hours of the initiation of the Recall. IMMU and BBSC will jointly develop Recall standard operating procedures.


4.2 FDA Correspondence and Inspections


Each of the parties shall provide the other with a copy of any correspondence or notices received by such party from FDA specifically relating to distribution of the Product within three (3) days of receipt. Each party shall also provide the other copies of any responses to any such correspondence or notices within three (3) days of making the response. BBSC shall notify IMMU of any FDA inspections of BBSC's facilities specifically relating to any of the Product and, if reasonably possible, shall afford IMMU the opportunity to be present at such inspection.


5. Purchase of Product/Risk


5.1 For Independent Accounts, upon execution of this Agreement:


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5.1.1 IMMU shall sell Product to BBSC on terms as set out in Schedule "A". The price stated in Schedule "A" may be changed by IMMU upon [*] days prior written notice to BBSC. BBSC shall buy such quantities of Product from IMMU as required to satisfy its obligations hereunder.


5.1.2 BBSC will obtain title to all Product on receipt and acceptance of the Product at the BBSC Facility. BBSC shall insure Product in its control against loss in shipment from the BBSC Facility, damage or natural catastrophes, acts of God or other reasons of force majeure.


5.2 For National Accounts, upon execution of this Agreement:


5.2.1 IMMU shall deliver, and BBSC shall accept, such quantities of the Product as shall be necessary for BBSC to fill orders for the Product and to meet the inventory requirement of National Accounts. All Product delivered to BBSC for IMMU for National Accounts will be held by BBSC on consignment and will remain at all times under and subject to the ownership, direction and control of IMMU until sold through BBSC to the National Accounts. Pricing for sales to national accounts shall be established by IMMU and, in recognition of certain marketing, training, product preparation and other services which will be performed by National Accounts in respect of the Product, may well differ from those set out in Schedule "A". Title to the Product held by BBSC on consignment will pass directly from IMMU to the National Accounts who purchase the Product through BBSC. IMMU shall bear the risk of loss of the Product not yet delivered by BBSC to a customer, whether by fire, theft or other casualty; provided, however, that BBSC shall indemnify IMMU for Product which is lost or damaged as a result of BBSC's negligence. During the term of this Agreement, BBSC will store Product at its Facility in [*] and possibly at its facilities in [*], BBSC shall notify IMMU promptly of any changes or additions to the locations at which supplies of the Product will be maintained.


5.3 Return Goods Policy


5.3.1 BBSC shall accept returns from customers only pursuant to SOPs agreed between IMMU and BBSC. BBSC shall forward unusable Product to IMMU for final disposition in accordance with applicable regulations. IMMU's sole obligation with respect to returned units of Product shall be to replace such units at its expense (or, at IMMU's option, to issue a credit therefore) in accordance with the SOPs.


5.3.2 IMMU shall replace at its expense, upon expiration of the use period thereof, any unit of Product for which the expiry date shall have occurred.


5.3.3 IMMU shall replace at its expense any unit of the Product which is received by BBSC from IMMU in unsalable condition, provided notice thereof


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is given to IMMU within thirty (30) days of receipt by BBSC. Such replacement unit will be delivered to BBSC within ten (10) days of receipt by IMMU of BBSC's notice.


5.3.4 The parties agree to review the Return Goods Policy in light of their experience with such policy and to make appropriate revisions therein when necessary, such revisions to be agreed to in writing.


6. Certain Obligations of the Parties


6.1 IMMU and BBSC will jointly develop standard operating procedures ("SOP's") in accordance with IMMU directives and consistent with FDA regulations within thirty (30) days from execution of this Agreement.


6.2 IMMU will deliver Product in boxes containing one (1) vial per box.


6.3 IMMU will provide package inserts for all single vial and other quantities.


6.4 IMMU warrants and represents to BBSC that the execution and performance of this Agreement will not breach any existing contracts or arrangements that IMMU has entered into with any third parties including but not limited to Mallinckrodt, Inc.


BBSC understands that IMMU has terminated its distribution arrangements with Mallinckrodt Medical, Inc., effective April 5, 1998, or such earlier date as shall be feasible. BBSC and IMMU shall cooperate in the transition of the distribution function from Mallinckrodt to BBSC.


6.5 IMMU will provide dedicated sales personnel to be the BBSC account manager for all communications regarding this Agreement.


6.6 IMMU will assist BBSC in training BBSC personnel concerning CEA-Scan.


7. Term And Termination


7.1 Initial Term


This Agreement shall be effective on April 6, 1998, or such earlier date as IMMU's distribution arrangements with Mallinckrodt shall terminate or Mallinckrodt shall otherwise onsent, and shall continue in full force and effect thereafter for a period of [*] from such effective date unless sooner terminated as provided herein. This Agreement shall automatically renew for successive [*] periods unless terminated as provided herein.


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