Cooperative Research & Development Agreement

EXHIBIT 10.70


COOPERATIVE RESEARCH AND DEVELOPMENT AGREEMENT


THIS AGREEMENT is made this 31st day of May, 1993 (the "Effective Date") by and between EISAI CO., LTD. ("Eisai"), a Japanese corporation with its principal executive offices at 6-10, Koishikawa 4-chome, Bunkyo-ku, Tokyo 112-88, Japan, and GENPHARM INTERNATIONAL, INC. ("GenPharm"), a California corporation with its principal executive offices at 297 North Bernardo Avenue, Mountain View, California 94043, United States of America.


RECITALS


A. Eisai and GenPharm previously executed a letter of intent dated March 30, 1993, contemplating the conduct by GenPharm, with the close cooperation of Eisai, of a program of research and development with the goal of generation of anti-CD4 human monoclonal antibodies in transgenic mice suitable for use in human therapy and diagnostics, and supply by GenPharm to Eisai of preclinical and clinical grade antibody material for Japanese preclinical and clinical studies in accordance with the requirements of Japanese regulatory authorities.


B. The parties wish to set forth their agreement regarding such program of research and development.


AGREEMENT


In consideration of their mutual promises and covenants, Eisai and GenPharm agree as follows:


ARTICLE I - DEFINITIONS


The following terms when used in this Agreement shall have the respective meanings assigned to them below.


- ----------- Confidential treatment has been requested for portions of this exhibit. The copy filed herewith omits the information subject to the confidentiality request. Omissions are designated as "[*****]".


1.01 Affiliate of either party or other entity shall mean any
--------- corporation, firm, association or other legal entity that directly or indirectly controls, is controlled by, or is under common control with, such entity, but only for so long as said control continues. For purposes of this definition, "control" means possession of the power, whether or not normally exercised, to direct the management and affairs of an entity, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise. In the case of a corporation, the direct or indirect ownership of 50% or more of its outstanding voting shares shall in any case be deemed to confer control, while the ownership of a lower percentage of such securities shall not necessarily preclude the existence of control.


1.02 Affiliate and Sublicensee Revenues shall mean all consideration
---------------------------------- except for purchase price of Anti-CD4 Antibodies received by Eisai from Affiliates or sublicensees that is fairly attributable to Eisai's sales of Anti- CD4 Antibodies or sublicensing of rights under GenPharm Patent Rights or GenPharm Know-How in Other Asian Countries, including such consideration received in the form of license fees, initial payments, technical assistance fees and royalties.


1.03 Anti-CD4 Antibodies shall mean human anti-CD4 monoclonal antibodies
------------------- produced from Transgenic Mice (as hereinafter defined) and developed in the course of the Research Program (as hereinafter defined).


1.04 Date of First Commercial Sale shall mean the date on which Anti-CD4
----------------------------- Antibodies are first sold by Eisai in Japan in accordance with this Agreement in a commercial transaction to an unrelated third party.


1.05 Field of Use shall mean the use of Anti-CD4 Antibodies in human
------------ therapy. If expanded in accordance with Section 4.04, Field of Use shall also include the use of Anti-CD4 Antibodies in human diagnostics.


1.06 GenPharm Know-How shall mean any information, data and/or materials
----------------- possessed, acquired and/or developed by GenPharm on or prior to the Effective Date or during the term of this Agreement relating to Anti-CD4 Antibodies that are not generally known or available, which information, data


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and materials are necessary or useful in order to manufacture, use, conduct research and/or development relating to, sell or seek approval to market Anti- CD4 Antibodies and, in particular, any such information, data or materials relating to processes for preparing, using or formulating or to the pharmacological, biological or clinical properties of Anti-CD4 Antibodies.


1.07 GenPharm Patent Rights shall mean:
-----------------------
(a) Patents and/or patent applications in the Territory that
GenPharm now owns or controls or that GenPharm may come to own
or control at any time during the term of this Agreement as
listed in Appendix A attached hereto, which Appendix shall be
promptly revised by the parties to account for any and all
patents or patent applications that GenPharm may come to own or
control in the Territory following the Effective Date;


(b) Patents in the Territory issued from applications described in
(a) above or from divisionals or continuations of such
applications;


(c) Claims of continuation-in-part applications in the Territory,
and of the resulting patents, which are directed to subject
matter specifically described in the patents and/or patent
applications described in (a) or (b) above;


(d) Claims of all later filed patent applications in the Territory,
and of the resulting patents, which are directed to subject
matter specifically described in the patents and/or patent
applications described in (a), (b), or (c) above; and


(e) Any reissues of patents described in (a), (b), (c) or (d) above.


For purposes of this definition, "control" by GenPharm of a patent or patent application shall mean GenPharm's having the right to grant to Eisai licenses or sublicenses thereunder within the Field of Use and in the Territory, without violating any rights of or obligations to third parties. Control may arise through ownership or license or other contractual rights.


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1.08 Net Third Party Sales [*****]
---------------------


1.09 Other Asian Countries shall mean all countries within the Territory
--------------------- other than Japan.


1.10 Product Liability shall mean liability to a third party resulting
----------------- from the consumption, handling or use of Anti-CD4 Antibodies which occurs away from the premises of GenPharm or Eisai after GenPharm or Eisai have relinquished possession.


1.11 Program Committee shall mean [*****]
-----------------


1.12 Research Field shall mean the conduct of research and development
-------------- activities related to the generation of Anti-CD4 Antibodies in Transgenic Mice.


1.13 Research Goal shall-mean generation of Anti-CD4 Antibodies in
------------- Transgenic Mice, and supply by GenPharm to Eisai of the quantities specified in Sections 2.03 and 3.04 of preclinical and clinical grade biological material containing Anti-CD4 Antibodies suitable for Japanese preclinical and clinical


***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SEC. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.


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studies in accordance with the requirements of Japanese regulatory authorities.


1.14 Research Program shall have the meaning assigned to it in Section
---------------- 2.01 below.


1.15 Territory shall mean Japan and the other Asian countries that are
--------- listed on Appendix B attached hereto.


1.16 Transgenic Mice shall mean GenPharm proprietary mice that are
--------------- transgenic for unrearranged human immunoglobulin genes.


ARTICLE II - RESEARCH PROGRAM


2.01 Program of Research. In a program of research and development
------------------- (the "Research Program"), GenPharm, with the close cooperation of Eisai, shall use its best efforts, including the provision of qualified personnel, equipment, materials and facilities, to achieve the Research Goal. An outline of activities that GenPharm shall perform in the course of the Research Program is attached hereto as Appendix C. Appendix C may be revised at any time with the written consent of both parties, which consent shall not unreasonably be withheld. Eisai may have access to all data and information relating to the Research Program during the term of the Agreement. The Research Program shall continue until December 31, 1995, and shall then terminate unless extended by agreement of the parties.


2.02 Oversight. The conduct of the Research Program shall be overseen
--------- and supervised by the Program Committee. Within 30 days after the end of each calendar quarter, GenPharm shall provide the Program Committee with research progress reports containing a reasonably detailed description of the work conducted by it in the course of the Research Program during the preceding quarter and of the results thereof. Research progress and results shall be discussed by the parties at meetings of the Program Committee, which shall bc held no less frequently than quarterly and more often as need arises.


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2.03 Information and Materials for Regulatory Studies. GenPharm shall,
------------------------------------------------ without any additional charge, provide Eisai with any and all GenPharm Know-How in connection with the manufacture, use and sale of Anti-CD4 Antibodies in the Territory during the term of this Agreement. Eisai may dispatch its scientist(s) to GenPharm for acquiring GenPharm Know-How during the term of this Agreement subject to agreement by the parties hereto.


Also, GenPharm shall without additional charge provide to Eisai five (5) grams of preclinical grade and twenty-five (25) grams of clinical grade Anti CD4 Antibody material for use as Eisai may determine in regulatory studies in Japan. The specifications of said preclinical and clinical grade anti-CD4 Antibody material shall be determined by agreement of the parties. Moreover, GenPharm shall provide to Eisai all protocols and results from GenPharm's own preclinical and clinical study activities so that Eisai may decide upon additional work that may be necessary to satisfy Japanese regulatory requirements.


In addition, ten (10) days following its receipt of the first benchmark payment scheduled in Section 3.02(a), GenPharm shall transfer a working cell bank to Eisai to enable Eisai to perform feasibility studies or generate additional antibody material.


Eisai shall provide to GenPharm the results of all preclinical and clinical studies conducted by Eisai in Japan for the purpose of Japanese regulatory requirements. Eisai shall have and retain sole ownership of the results of all preclinical and clinical studies conducted by Eisai. Eisai hereby grants to GenPharm a non-exclusive and royalty-free license in the Field of Use and outside the Territory to use the results of all preclinical and clinical studies conducted by Eisai (without any right of sublicense except on a basis where the sublicensee agrees to grant a non-exclusive and royalty-free license in the Field of Use and in the Territory to Eisai to use the results of all corresponding preclinical and clinical studies conducted by GenPharm's sublicensee).


2.04 Exclusivity. During the term of this Agreement, GenPharm shall
----------- not act within the Research Field and the Territory for anyone other than Eisai.


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ARTICLE III - PAYMENTS TO GENPHARM RELATED TO RESEARCH
PROGRAM


3.01 Research Payments. [*****]
-----------------


3.02 Benchmark Payments. [*****]
------------------


***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SEC. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.


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[*****]


3.03 Withholding Tax. Payments due to GenPharm under Sections 3.01 or
--------------- 3.02(a) and 3.02(b) will be made without any withholding for or on account of taxes or other charges. If Japanese taxing authorities subsequently determine that taxes should have been withheld on any such payments and assess Eisai for such taxes, GenPharm will pay or reimburse Eisai for the taxes so assessed, together with any interest or penalties required to be paid thereon. GenPharm agrees to provide any cost information requested by the Japanese taxing authorities, and otherwise to cooperate with Eisai in seeking to establish that the payments are not subject to withholding. Any tax which may be required by Japanese taxing authorities to be withheld on the payments provided for in Section 3.02(c) shall be deductible from the payments, provided that Eisai shall


***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SEC. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.


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furnish GenPharm with a copy of the official tax receipt for the payment of such withholding tax.


3.04 Supply of Additional Material for Regulatory Studies. For GenPharm's supply to Eisai of any antibody material for regulatory studies in Japan in excess of the five (5) grams of preclinical grade material and twenty- five (25) grams of clinical grade material to be furnished to Eisai in accordance with Section 2.03, Eisai shall pay GenPharm an amount equal to [*****] along with any invoice sent to Eisai.


ARTICLE IV - OWNERSHIP OF INVENTIONS, GRANT OF LICENSE, AND
PATENTS


4.01 Ownership of Intellectual Property. Each party shall have and
---------------------------------- retain sole ownership of technical information and data, know-how, trade secrets and inventions, whether or not patented or patentable, developed or made by its own employees, consultants or agents. The parties shall have joint ownership of technical information and data, know-how, trade secrets and inventions (the "Jointly-Owned Technology"), whether or not patented or patentable, developed or made jointly by employees, consultants or agents of each party during the term of this Agreement. Each party shall have the right (with the right to sublicense) to use the Jointly-Owned Technology in perpetuity for any purpose without accounting to the other party.


4.02 Filing and Prosecution of Patent Applications. GenPharm shall, at
--------------------------------------------- its own expense, prosecute and maintain the Japanese patent applications included in the GenPharm Patent Rights. Unless otherwise agreed in writing by the parties, GenPharm shall, in its own name and at its sole expense, file, prosecute and maintain in Japan any patent applications relating to Anti-CD4


***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SEC. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.


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Antibodies that GenPharm has filed in any country outside the Territory, and shall use reasonable efforts to obtain and maintain patent registrations based on such applications.


GenPharm may, in its own name and at its sole expense, file, prosecute and maintain patent applications covering GenPharm Patent Rights in Other Asian Countries. In the event that GenPharm fails to file, prosecute and maintain a patent application covering such GenPharm Patent Rights in any Other Asian Country within sixty (60) days after Eisai has requested that it do so, Eisai may, in GenPharm's name but at Eisai's sole expense, file, prosecute and maintain such application in such country. Eisai may recover the costs of any such patent application filing, etc., by it through deduction from payments due to GenPharm under Section 5.02 or 5.03 in respect of activities in such country, but not so as to reduce any such payment, after allowance of any deductions permitted under Section 5.04, by more than [*****] (if the payment is a royalty at the rate of [*****] Net Third Party Sales or a [*****] share of Affiliate and Sublicensee Revenues) or [*****] (if the payment is a royalty at the rate of ***** of Net Third Party Sales or a [*****] share of Affiliate and Sublicensee Revenues).


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