Manufacturing And Supply Agreement

Confidential Treatment has been requested for portions of this exhibit. The copy filed herewith omits the information subject to the confidentiality request. Omissions are designed as[*] . A complete version of this exhibit has been filed separately with the Securities and Exchange Commission.



MANUFACTURING AND SUPPLY AGREEMENT



This Manufacturing and Supply Agreement ("Agreement") is entered into as of the date signed by the last party to sign this Agreement, and with an effective date of May 4, 2005 (the "Effective Date") by and between Hyaluron Inc., with its principal place of business at 99 S. Bedford Street, Suite 2, Burlington, MA 01803, ("Hyaluron") and NeoRx, a Washington corporation, having its principal place of business at 300 Elliott Avenue West, Suite 500, Seattle, Wa 98119-4114. Hyaluron and NeoRx may be referred to herein as a "Party" or, collectively, as the "Parties".





WHEREAS , NeoRx is engaged in the business of developing therapeutic product(s); and



WHEREAS , Hyaluron is in the business of developing, manufacturing, testing and packaging sterile pharmaceutical products; and



WHEREAS , NeoRx desires to utilize Hyaluron to develop, manufacture, test, and/or package supplies of the product(s) as designated by NeoRx:



NOW, THEREFORE , the Parties agree as follows:



Definitions. As used herein the following terms will have the following meanings:





"API" means the raw material components of the Product, as specified and provided to Hyaluron by NeoRx.



"Batch" means the entire amount of Product yielded from a manufacturing event using a specific quantity of APIs, Excipients, and components processed in accordance with the Master Batch Record and the Manufacturing Standards.



"Batch Record" means the document created as and after each Batch is Processed and Packaged. Each Batch Record will reflect and incorporate all aspects of the Master Batch Record, the applicable Certificate of Analysis, and any Manufacturing Variance Reports issued with respect to such Batch.



"Batch Release" means the final sign-off by a party92s quality department marking the culmination of the quality process through which a batch of Product is shown to conform to all aspects of the Manufacturing Standards.



"Bulk" means the bulk API for formulation.



"Compounded Bulk" means the API and Excipients which have been compounded but not filled or packaged or finished into a final dosage presentation.



"Certificate of Analysis" means a certificate that accompanies each shipment of APIs or Product certifying that the APIs or Product meets the specifications as defined in the Manufacturing Standards.



"Date of Manufacture" means the date of sterile filtration and/or filling of the Compounded Bulk.



"Excipient" means any substance other than the API used in formulating the Compounded Bulk.



"API Reference Standard" means a quantity of APIs with a known assay, supplied by NeoRx, with which Hyaluron may perform comparative analysis to API samples having an unknown assay.








[*] designates portions of this document that have been omitted pursuant to a request for confidential treatment filed separately with the Commission.



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"API Specifications" means the specifications with respect to the APIs as set forth in the Master Batch Record.



"Manufacturing Standards" means the specifications for Processing, Packaging, and storing the Product set forth in the Specifications, the Master Batch Record, CGMPs (as defined below), MSDSs, the QA Schedule and all applicable U.S. laws and regulations, to the extent such terms and conditions are not inconsistent with this Agreement.



"Manufacturing Variance Report" means a written report indicating any significant variance in the Processing or Packaging of a Batch from the procedures set forth in the Master Batch Record.



"Master Batch Record" means the document, as may be amended from time to time, specifying: (i) the API Specifications, (ii) the procedures for testing and releasing the APIs, (iii) the Excipients, (iv) the Primary Components, (v) Secondary Packaging, (vi) the Specifications, (vii) the formula (listing the APIs and the Excipients for the Product), and (viii) the procedures for manufacturing the Product (listing the APIs, the Excipients, the Primary Components, and the Secondary Packaging).



"To Package" and "Packaging" means the act of inspecting, labeling, and packing the Product into units.



"Primary Components" means the vial/syringe, stopper, and seal as identified in the Master Batch Record.



"Process" or "Processing" means the manufacturing procedures, or any part thereof, involved in manufacturing the Product in accordance with the Manufacturing Standards.



"Product" means finished product in final dosage presentation.



"Specifications" means the specifications for the APIs, the Excipients, the Primary Components, the Secondary Packaging, and the in-process and release specifications for the Product, as set forth initially in the applicable Statement or Work and, subsequently in the Master Batch Record. Revisions to Specifications may be made by the Parties from time to time and such changes will be reflected in the Master Batch Record.



"Qualified Supplier" means a supplier of materials or components that has been audited and/or assessed by Hyaluron and has passed Hyaluron92s quality assurance standards.



"Secondary Packaging" means any component other than Primary Components used to convert primary units into units.



"Shipping Components" means the packaging, boxes, and shipping containers into which the Product is placed for shipment to NeoRx.



"Variance" or "Deviation" means a departure from an established quality standard (e.g., CGMP standard operating procedure, Master Batch Record or Specifications,, analytical control procedure, water monitoring procedure, environmental monitoring specification, equipment maintenance schedule, or any unusual occurrence), which may be either anticipated or unanticipated departures from established quality standards and may have the potential to affect the safety, identity, strength, quality or purity of the Product or Compounded Bulk.





1. Quotation . Hyaluron will provide to NeoRx the manufacturing and related services (the " Services") as described in the applicable Quotation (the "Quotation"), a form of which is attached hereto as Exhibit A and incorporated herein by reference. The Parties will mutually agree to the contents of each Quotation and any amendments thereto. Each Quotation will, in addition to other matters, address the quality assurance and control procedures. The Quotation may specify that NeoRx will provide certain materials to Hyaluron or require that Hyaluron acquire certain materials from a particular source. If NeoRx provides materials to Hyaluron, title in and risk of loss of such materials will remain with NeoRx,






[*] designates portions of this document that have been omitted pursuant to a request for confidential treatment filed separately with the Commission.



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unless such loss occurs due to negligence by Hyaluron. In the event NeoRx requests additional services relating to this Agreement, the Parties may mutually agree upon such services and the costs related thereto in a separate written agreement, which must be signed by authorized representatives of both Parties before any such costs are incurred.





2. Compensation for Services . Compensation for the Services will be as specified in the Quotation. Hyaluron will bill NeoRx for the Services as specified in the applicable Purchase Order. Such invoices will be payable upon receipt by NeoRx. All pricing, payments, credits, allowances or other monetary adjustments under this Agreement will be in U.S. Dollars.



3. Advance Notice For Services . NeoRx agreesto give Hyaluron 60 days advance written notice prior to the required date of manufacture for each Product Order under the terms of this Agreement.



4. Services .





(a) All Services will be conducted in accordance with the applicable Quotation and Hyaluron92s internal Standard Operating Procedures ("SOPs"), copies of which will be available for inspection by NeoRx or its designated representatives at Hyaluron upon reasonable notice. Notwithstanding the foregoing, unless otherwise specified in the applicable Purchase Order, the manufacturing of the Product will be conducted in accordance with Current Good Manufacturing Practices ("CGMPs") as described in the relevant United States Food and Drug Administration ("FDA") regulations and guidelines for the manufacture, control and storage of human pharmaceutical products, including, without limitation, the FDA92s guidance for industry titled "Sterile Drug Products Produced by Aseptic Processing 96 Current Good Manufacturing Practice", dated September 2004.



(b) Hyaluron will follow CGMP standards to manufacture for NeoRx clinical Batches of a finished dosage form of the Product per the Manufacturing Standards, and as may be further developed by Hyaluron, using the APIs, components and Excipients specified. In accordance with CGMP and during the term of this Agreement, Hyaluron will utilize validated cleaning and changeover procedures prior to manufacturing any Product for NeoRx. Both Parties will promptly notify each other of any new instructions or specifications required by CGMP. Hyaluron will timely provide NeoRx with (a) a written description of any actions taken to comply with new or revised CGMPs that affect the Product and/or (b) copies of Hyaluron92s manufacturing records, including its Batch Records regarding the Product, for the purposes of assuring product quality and compliance with agreed-upon manufacturing procedures.



(c) Hyaluron will adhere to the Specifications and requirements, as detailed in the Master Batch Record, the Manufacturing Standards and mutually agreed upon protocols, where such specifications are in compliance and agreement with FDA and other applicable regulatory agency guidelines. Hyaluron will obtain NeoRx92s prior approval before it implements any change in the materials, equipment, process or procedures used to manufacture the Product that would constitute a significant Deviation under CGMP. Hyaluron will disclose all proposed changes in such manufacturing materials, equipment, process or procedure to NeoRx.



(d) In the event that the Bulk fails to meet in-process or release specifications, NeoRx may authorize a Deviation from the Batch Record in an attempt to salvage the Batch. NeoRx assumes responsibility for all costs associated with batch failure(s) until such time as Hyaluron has validated the filling line for the Product, unless such batch failure(s) result(s) from negligence by Hyaluron. Hyaluron will assume responsibility for Excipient costs for batch failures occurring subsequent to product fill line validation, unless such batch failures result from negligence by NeoRx. At no time will Hyaluron be responsible for API costs resulting from batch failure.








[*] designates portions of this document that have been omitted pursuant to a request for confidential treatment filed separately with the Commission.



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(e) Hyaluron will obtain materials and components for production from Qualified Suppliers.



(f) Hyaluron and NeoRx will mutually develop a Master Batch Record for the Product following the technical specifications, methods and know-how provided by NeoRx.



(g) NeoRx will transfer to Hyaluron appropriate methods and in process assays for manufacturing the Product. Such methods and in process assays will be confirmed, or if requested, validated by Hyaluron for their application to the finished Product.



(h) Hyaluron will provide NeoRx with copies of executed Batch Records, process deviations and analytical data showing that the Specifications have been met, following completion of the manufacture of the Product. NeoRx will have the right to review and approve Master Batch Records, to approve planned process deviations and to receive prompt notice of unplanned process deviations. Hyaluron will retain original documents relating to the manufacture of NeoRx Products and store these documents in accordance with CGMP and Hyaluron92s internal quality assurance SOPs. Subject to the foregoing Hyaluron will notify NeoRx before disposing of any of this Product documentation. In such case, NeoRx may request, within seven days, to have the documents shipped to NeoRx in accordance with NeoRx92s instructions and at NeoRx92s expense.



(i) In the event that NeoRx proposes any significant change to the Specifications or manufacturing Process, NeoRx will deliver written notice to Hyaluron describing such Change. Hyaluron will respond to any such notice within 15 days after Hyaluron92s receipt thereof; provided, however, that the Specifications or Process will not be supplemented, modified or amended in any respect without the prior written agreement of the Parties. If any change in the Primary Components, Secondary Packaging, Shipping Components, Processes or Product testing Specifications materially increases Hyaluron92s cost to manufacture, test, or package the Product, Hyaluron reserves the right to make reasonable pricing adjustments if needed to accommodate such changes. Prior to initiating any work, Hyaluron will provide a scope of work and cost proposal. New pricing will be effective upon implementation of the new specifications or process.



(j) Hyaluron will provide NeoRx with all documents NeoRx reasonably requests regarding its manufacturing processes and procedures for the Product. Hyaluron further agrees to use reasonable commercial efforts to assist NeoRx in obtaining FDA approval of a New Drug Application (NDA) with respect to the Product. Where practicable, Hyaluron will assist NeoRx in obtaining approvals from other government or regulatory agencies which may be required for the conduct of clinical trials of the Product in other countries. Hyaluron specifically agrees to cooperate with the FDA or other regulatory agencies, including but not limited to any inspection prior to approval of any product.



(k) Labeling and packaging will be approved by NeoRx, and all labels and package inserts will be developed in accordance with Hyaluron92s guidelines with regard to physical dimensions and handling procedures.



(l) Hyaluron will have the right to sample and retest Product or to have an outside laboratory sample and retest Product if NeoRx claims that such Product does not conform to the Manufacturing Standards. Disputes between the Parties as to whether any Product rejected by NeoRx conforms to the Manufacturing Standards will be resolved by a mutually acceptable third party testing laboratory.



(m) In the event that a batch of Compounded Bulk is found not to conform to the bulk release specification set forth in the Manufacturing Standards prior to initiation of the fill, Hyaluron will undertake one or more remedial steps in an attempt to bring the Compounded Bulk into specification.






[*] designates portions of this document that have been omitted pursuant to a request for confidential treatment filed separately with the Commission.



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Should these remedial steps fail to bring the Compounded Bulk into specification NeoRx may direct Hyaluron to terminate the manufacturing process at this stage.



(n) Hyaluron will ship Product to the destination specified by NeoRx in accordance with the applicable NeoRx instructions and will store the Product in compliance with CGMP at Hyaluron92s facilities until delivery. All shipping costs will be the responsibility of NeoRx. Title to and risk of loss of the Product shall pass to NeoRx as the Product is delivered F.O.B. via a common carrier. Completion of the task will be deemed to occur at the time Hyaluron informs NeoRx that the Batch Record is signed off and the Certificate of Analysis has been issued. NeoRx will be deemed to have accepted delivery of Batch of Product if no Notice of Rejection/Nonconformance is received by Hyaluron within 30 days after completion of the task. If NeoRx requests Hyaluron to store Product longer than 2 weeks past the release date, there will be a storage charge applied which will be proportional to the quantity stored.



(o) Hyaluron will retain and store samples of Product in accordance with CGMPs and Hyaluron92s internal quality assurance SOPs. Subject to the foregoing, Hyaluron will notify NeoRx before disposing of any retention samples of manufacturing lots of intermediates or the Product. In such case, NeoRx may request, within seven days, to have the samples shipped to NeoRx in accordance with NeoRx92s instructions and at NeoRx92s expense.



(p) Hyaluron will dispose of all waste in accordance with applicable local and federal regulations at NeoRx92s expense.





4. Representations, Warranties and Covenants .



(a) Hyaluron represents and warrants to NeoRx that:



(i) All Product furnished pursuant to this Agreement will conform to the relevant Specifications except in case of variance or deviation of which NeoRx has been notified by Hyaluron;



(ii) All Product furnished pursuant to this Agreement will be manufactured and stored in accordance with, and all packaging and labeling operations will be conducted in compliance with, CGMPs and other applicable FDA and other governmental laws and regulations and all other requirements set forth in the applicable Purchase Order;



(iii) All manufacturing under this Agreement will be performed with the degree of skill and diligence normally employed by a contract manufacturer performing the same or similar services; and





(iv) Hyaluron92s application of any intellectual property, other than that provided to Hyaluron by NeoRx, in the performance of the Services will not infringe any third party intellectual property rights.





(v) Hyaluron represents as of the date of this Agreement and continuously during the term of this Agreement that, to the best of its knowledge, it and its employees, affiliates, contractors, and agents have never been (i) debarred or (ii) convicted of a crime for which a person can be debarred, under Section 335(a) or 335(b) of the Federal Food, Drug, and Cosmetic Act (the "Act"). Hyaluron represents that it has never been and, to the best of its knowledge, none of its employees, affiliates, contractors, or agents has ever been (i) threatened to be debarred under the Act or (ii) indicted for a crime or otherwise engaged in conduct for which a person can be debarred under the Act. Hyaluron agrees that it will promptly notify NeoRx in the event it receives notification of any such debarment, conviction, threat or indictment.








[*] designates portions of this document that have been omitted pursuant to a request for confidential treatment filed separately with the Commission.



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(b) NeoRx represents and warrants to Hyaluron that Hyaluron92s application of any intellectual property provided to Hyaluron by NeoRx in the performance of the Services will not infringe any third party intellectual property rights.





(c) Each of NeoRx and Hyaluron represent and warrant to the other that:





(i) it is duly organized and validly existing under the laws of the jurisdiction of its incorporation and has full corporate power and authority to enter into this Agreement and to carry out the provisions hereof;


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