CERTAIN PORTIONS OF THIS EXHIBIT FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WERE OMITTED AND REPLACED WITH [*]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE SECURITIES EXCHANGE ACT OF 1934.
April 9, 2015
Yuval Cohen, CEO
Corbus Pharmaceuticals, Inc.
100 River Ridge Dive
Norwood, MA 02062
Clinical Trial for Resunab oral anti-inflammatory drug
Amount of Award:
Name of Awardee:
Corbus Pharmaceuticals, Inc. (Corbus)
We are pleased to inform you that Cystic Fibrosis Foundation Therapeutics, Inc. (CFFT) is hereby issuing an award for the Development Program described in Exhibit A and disbursed in accordance with Exhibit B up to the amount indicated above (the Award). CFFT has determined that the Award is consistent with its charitable mission to cure and/or mitigate cystic fibrosis and that the Development Program is unlikely to be completed or could be significantly delayed without the award. The awardee, Corbus, shall be responsible for the payment of all of the remaining costs required to complete the Development Program and for costs associated with continuing CRE necessary to further develop and commercialize the Product. Each partys obligations hereunder will commence and apply upon the execution of this Agreement. The Award is in furtherance of CFFTs charitable mission to cure and mitigate the effects of Cystic Fibrosis. The Award is subject to the following terms, conditions and policies of this Letter Agreement (Agreement):
1. Disbursement of Award; CFFT Know-How; Reports.
(a) The Award will be disbursed by CFFT to Corbus in accordance with the Milestone Payment Schedule set forth in Exhibit B. Any CFFT funds not expended on the Development Program must be returned to CFFT, and upon such return, the amounts of such returned funds will not be included as part of the Award for purposes of calculating any royalties or other amounts owed by Corbus to CFFT pursuant to Paragraph 2(b).
(b) To the extent CFFT provides or makes available any information, expertise, know-how or other intellectual property related to cystic fibrosis or the treatment, prevention, or cure thereof (CFFT Know-How) to Corbus, CFFT hereby grants to Corbus a non-exclusive, transferable, sublicensable (through multiple tiers), worldwide right and license under all of CFFTs rights in such CFFT Know-How to assist Corbus to research, develop, commercialize, make, have made, use, sell, have sold, offer for sale, import, export and otherwise exploit the Product.
(c) During the Development Program, Corbus agrees to provide CFFT and the Project Advisory Group (PAG) specified below with a quarterly summary report, and a reasonably detailed, written report every six (6) months, summarizing progress toward achieving the goals of the Development Program. In addition, Corbus shall prepare and deliver to CFFT a closing report within thirty (30) days after the completion of the Development Program. Corbus shall continue to report to CFFT annually through the PAG (as hereafter provided for) on the progress of its development activities regarding the Product until the earlier of (i) first commercial sale of the Product (ii) such research efforts related to the Product are abandoned by Corbus, its Affiliates and its sublicensees, solely as a result of scientific failure or (iii) the effective date of the Interruption License.
2. Royalties. In consideration of CFFTs license and transfer of intellectual property and CFFT Know How pursuant to this Agreement, Corbus agrees to pay to CFFT royalties as follows:
(a) Corbus shall pay a one-time royalty to CFFT in an amount equal to the Royalty Cap. Such amount shall be paid in three (3) equal installments: the first within ninety (90) days of the first commercial sale of the Product in the Field; and the remaining installments on or before the first and second anniversaries of such date.
(b) In addition to the royalty payable pursuant to subparagraph (a) above, Corbus shall pay to CFFT a one-time royalty equal to the Actual Award within sixty (60) days after the end of the first calendar year after which aggregate Net Sales of the Product in the Field exceed $ 500 million.
(c) In the event of a license, sale or other transfer of the Product in the Field (excluding Net Sales) or a Change of Control Transaction (a Disposition), Corbus shall pay to CFFT a payment equal to ten percent (10%) of any license or purchase price payments actually received by Corbus in the event of any such license, sale or other transfer to a third party of Corbuss rights to the Corbus Development Program Technology, up to three (3) times the amount of the Actual Award (the Disposition Payment). Such payment shall be made within sixty (60) days after any transactions giving rise to such payment. Notwithstanding the payment of the Disposition Payment, the royalties specified in subparagraphs (a), (b) and (c) shall survive, provided that the royalty specified in subparagraph (a) shall be reduced by the Disposition Payment. In the event that the Disposition relates to the use of the Product in the Field and outside of the Field or includes any intellectual property or other assets (other than Corbus Development Program Technology that is specifically related to the development of the Product in the Field), the Parties shall agree in good faith on the proportional share of the value of any license or other purchase price payments attributable to the Corbus Development Program Technology based upon the respective market size for the Product or other assets in determining the amount of the Disposition Payment.
3. Commercially Reasonable Efforts. Corbus shall use Commercially Reasonable Efforts to conduct the Development Program during the term of this Agreement. After the Development Program is completed, Corbus or its licensee, sublicensee, assignee or successor shall exercise Commercially Reasonable Efforts to continue to develop the Product.
4. Program Advisory Group (PAG).
(a) Corbus and CFFT shall form a PAG. The PAG serves the function of allowing CFFT to oversee the use of the Award funds and to ensure that such funds are used solely in furtherance of CFFTs tax-exempt mission, which is to promote the cure and/or mitigation of cystic fibrosis. The PAG shall terminate and cease to exist on the earlier of the commercialization of the Product or the termination of this Agreement. The PAG shall consist of two (2) individuals appointed by Corbus and two (2) individuals appointed by CFFT. One of such individuals from Corbus and CFFT, respectively, shall be the principal liaison to the Development Program. A party may replace the individuals appointed by such party and designate a different individual as the principal liaison upon written notice to the other party.
(b) The role of the PAG shall be to determine, discuss and propose amendments to the Development Program and budget, to determine whether payment milestones have been achieved, and
provide recommendations on other issues raised by either party relating to the Development Program, provided that no change to the Development Program shall be made without the written agreement of both parties.
c) A partys cost of attending and participating in the PAG shall be covered by such party.
5. Interruption License. Corbus hereby grants the Interruption License to CFFT, which Interruption License shall be effective as provided below. Upon written notice from CFFT following an Interruption (the Interruption Notice), Corbus shall elect, within thirty (30) days of such Interruption Notice, one of the following options by notice to CFFT:
Corbus shall reasonably demonstrate, in the form of a written progress report, that an Interruption has not occurred, or that Corbus, an Affiliate thereof, or a licensee or sublicensee of either of the foregoing is exercising Commercially Reasonable Efforts to research, develop or commercialize the Product;
Corbus shall provide CFFT with notice within such thirty (30) day-period that Corbus, an Affiliate thereof, or a licensee or sublicensee of either of the foregoing, has plans to resume Commercially Reasonable Efforts to develop or commercialize the Product and resumes such Commercially Reasonable Efforts within the ninety (90) day period following such notice;
The Interruption License shall become effective, as set forth below; or
Corbus may elect in lieu of the Interruption License, within thirty (30) days of the Interruption Notice (but only if and when the Interruption License would otherwise have become effective), to pay to CFFT the greater of (A) two (2) times the Actual Award, or (B) the total of the Actual Award plus Interest up to the time of such election; and in the event of such election and payment, this Paragraph 5 shall otherwise no longer be applicable.
The failure of the drug due to safety issues or lack of sufficient efficacy in the Field or regulatory restrictions shall not be considered an Interruption. In addition, the Interruption License shall terminate and be of no further force and effect following payment by Corbus or any of its sublicensees of any royalty payment under Paragraph 2.
If Corbus has elected (a) or (b) above within thirty (30) days of the Interruption Notice, the Interruption Notice shall be deemed satisfied and be of no further force or effect unless CFFT notifies Corbus within thirty (30) days after receipt of Corbus progress report under (a) above or provides notice under (b) above
that CFFT disputes such progress report or notice, as the case may be. If CFFT provides timely notice of its dispute, the parties shall resolve such dispute in accordance with the dispute resolution provision of this Agreement.
If Corbus has elected (a) or (b) above, CFFT has disputed such election, the resolution of the dispute is concluded and the final outcome of such dispute resolution is that such election was defective, Corbus shall be deemed to have made the election specified in (c) above unless within thirty (30) days of the outcome of such dispute resolution, Corbus elects to exercise its rights under (d) above. If Corbus has made (or is deemed to have made) the election specified in (c) above, the Interruption License shall be effective upon such election (or deemed election) (such date, the Interruption License Effective Date). The Interruption License shall be an exclusive (even as to Corbus), worldwide license to CFFT under the Corbus Development Program Technology solely to the extent necessary to manufacture, have manufactured, license, use, sell, offer to sell, and support the Product in the Field. Corbus shall deliver to CFFT, within ninety (90) days after the Interruption License Effective Date, a copy of all materials and data in its possession or control constituting Development Program Technology, to the extent required by CFFT to make, use, or sell the Product in the Field. For the avoidance of doubt, Corbus shall retain all rights to the Development Program Technology for use outside of the Field. In the event that Corbus assigns all of or certain of its rights and obligations to develop and commercialize the Product at any time to a third party, such third party shall be subject to the obligations of the Interruption License. The Interruption License shall be deemed to constitute intellectual property as defined in Section 365(n) of the U.S. Bankruptcy Code; provided, however, that nothing in this Agreement shall be deemed to constitute a present exercise of such rights and elections. Corbus agrees that CFFT, as a licensee of such rights, shall retain and may exercise all of its rights and elections under the U.S. Bankruptcy Code.
In the event the Interruption License becomes effective pursuant to this Section 5, CFFT shall share equally with Corbus any income received in connection with the sublicense of the Interruption License, provided that, CFFTs share shall be increased by two (2) percentage points and Corbus share shall be decreased by like percentage points, for every additional one million dollars ($1 million) invested by CFFT or its Affiliate in the Product after the effective date of the Interruption License. For example, if after the effective date of the Interruption License, CFFT invests an additional ten million dollars ($10 million) in additional research for the Product, CFFTs share of any such income shall increase to seventy percent (70%), and Corbus share of such income shall decrease to thirty percent (30%) ; provided however that at no time shall Corbuss share of income received be less than 20%.
6. Indemnification by Corbus.
(a) Corbus shall indemnify, defend and hold harmless CFFT, its Affiliates, and their respective directors, officers, employees, consultants, committee members, volunteers, agents and representatives and their respective successors, heirs and assigns (each, an CFFT Indemnitee), from and against any and all claims, suits and demands of third parties and losses, liabilities, damages for personal injury, property damage or otherwise, costs, penalties, fines and expenses (including court costs and the reasonable fees of attorneys and other professionals) payable to such third parties arising out of, and relating to any such third party claims resulting from:
(i) the conduct of the Development Program by Corbus or its Affiliates or their respective directors, officers, employees, consultants, agents, representatives, licensees, sublicensees, subcontractors and/or investigators (each, a Corbus Party) under this Agreement and/or pursuant to one or more agreements between Corbus and any Corbus Party, or any actual or alleged violation of law resulting therefrom;
(ii) Corbus or its Affiliates development, manufacture, or commercialization of the Product developed in whole or in part as a result of the Development Program;
(iii) any claim of infringement or misappropriation with respect to the conduct of the Development Program by or on behalf of Corbus or its Affiliates, or Corbus or its Affiliates third party licensees or sublicensees manufacture, use, sale, or import of the Product developed in whole or in part as a result of the Development Program, other than any such claim to the extent deriving from the use of CFFT Know-How; and
(iv) any tort claims of personal injury (including death) relating to or arising out of any such injury sustained as the result of, or in connection with, the conduct of the Development Program by or on behalf of Corbus or its Affiliates, or Corbus or its Affiliates third party licensees or sublicensees (other than CFFT or any of CFFTs licensees or sublicensees development, manufacture, or commercialization of the Product developed in whole or in part as a result of the Development Program; in each case except to the extent the claim, suit, demand, liability, damage, or loss results from the negligence, willful misconduct or other fault of a CFFT Indemnitee.
(b) CFFT will indemnify, defend and hold harmless Corbus, its Affiliates and their respective directors, officers, employees, consultants, agents and representatives and their respective successors, heirs and assigns (Corbus Indemnitees) from and against any and all claims, suits and demands of third parties and losses, liabilities, damages for personal injury, property damage or otherwise, costs, penalties, fines and expenses (including court costs and the reasonable fees of attorneys and other professionals) payable to such third parties arising out of, resulting from, or relating to any exercise of any rights under the Interruption License by or on behalf of CFFT, any designee, assignee or successor in interest thereto, or any licensee or sublicensee of any of the foregoing, except to the extent the claim, suit, demand, liability, damage or loss results from the negligence or willful misconduct of a Corbus Indemnitee after the effective date of the Interruption License.
(c) A party entitled to indemnification under this Paragraph 6 (the Indemnified Party) will promptly notify the other Party (the Indemnifying Party) of any claims, suits, demands, losses, liabilities, damages costs, penalties, fines, or expenses subject to indemnification under this Paragraph 6 of which it is made aware. The Indemnified Party will cooperate, and exert efforts to cause other Indemnified Parties to cooperate, in assisting the Indemnifying Party in presenting a defense, if requested to do so. The Indemnifying Party shall have sole control to select defense counsel, direct the defense of any such complaint or claim, and the right to settle claims at the Indemnifying Partys sole expense, provided that any such settlement does not incur non-indemnified liability for or admit fault by any Indemnified Party. In the event a claim or action is or may be asserted, the Indemnified Party shall have the right to select and to obtain representation by separate legal counsel. If the Indemnified Party exercises such right, all costs and expenses incurred for such separate counsel shall be borne by the Indemnified Party. No Indemnified Party shall settle or enter into any voluntary disposition of any matter subject to indemnification under this Paragraph 6 without the prior written consent of the Indemnifying Party, such consent not to be unreasonably withheld.
7. Insurance. Corbus shall maintain at its own expense, with a reputable insurance carrier, coverage for Corbus, its Affiliates, and their respective employees written on a per occurrence basis commensurate with a reasonable assessment of the risks associated with the development efforts being conducted by Corbus, the following policies: Commercial general liability insurance, including contractual liability as respects this Agreement for bodily injury and property damage and, no later than the first use administration of the Product to a human subject, the Product liability and clinical trials liability.
Maintenance of such insurance coverage will not relieve Corbus of any responsibility under this Agreement for damage in excess of insurance limits or otherwise. On or prior to the Effective Date of this
Agreement, Corbus shall provide CFFT with an insurance certificate from the insurer(s), broker(s) or agent(s) (hereinafter collectively the Insurance Providers) evidencing the applicable insurance coverage. At its request, CFFT may review Corbus insurance coverage with relevant Corbus personnel no more than one time per year.
8. Intellectual Property Rights. All inventions, data, know-how, information, results, analyses, and other intellectual property rights resulting from the Development Program shall, as between the parties, be owned by Corbus and the preparation, filing and maintenance of all patents resulting from the Development Program shall, as between the parties, be the sole responsibility, and under the sole control, of Corbus. Subject to Paragraph 5, CFFT hereby assigns and transfers to Corbus all of CFFTs right, title, and interest in and to all inventions and other intellectual property resulting from the Development Program, CFFTs access to, or knowledge or use of, any Corbus Development Program Technology, the Product, or confidential or proprietary information of Corbus, and all intellectual property rights related to any of the foregoing, free and clear of all liens, claims, and encumbrances.
9. Termination of Agreement.
(a) Either party may terminate this Agreement for cause, without prejudice to any other remedies available to the terminated party with respect thereto, by providing the other party with written notice of such cause and intent to terminate; provided, however, that the other party shall have thirty (30) days following the receipt of written notice to cure such cause. For this Paragraph 9, cause shall mean (i) a partys material breach of its covenants or obligations under this Agreement, (ii) a bankruptcy or similar filing by a party or a proceeding under the applicable bankruptcy laws or under any dissolution or liquidation law or statute now or hereafter in effect and filed against such party or all or substantially all of its assets if such filing is not dismissed within sixty (60) days after the date of its filing, or (iii) Corbus material failure to achieve any Milestone within ninety (90) days of its anticipated achievement day. Notwithstanding the preceding, no such termination shall become effective if a party promptly disputes the basis thereof in good faith and proceeds with dispute resolution provisions hereof, unless or until such basis for termination is established by such process.
(b) The following provisions shall survive the termination of this Agreement: Paragraphs 2, 5, 6, 7, 8, 9, 10, 11, and 12.
10. Audits. At the request of CFFT, from time to time, Corbus shall permit CFFT, upon reasonable notice, to audit and examine such books and records of Corbus as may be necessary for verifying Corbus expenditures of the Award and the payment of royalties, if any, but no more frequently than once every calendar year. All non-public information made available by Corbus as part of any such audit, as part of any other reports (whether written or non-written), or otherwise under this Agreement (including, but not limited to, in connection with the PAG) shall be regarded as Corbus confidential information and CFFT hereby covenants that, except to the extent required by law (provided that CFFT promptly notifies Corbus of such requirement and permits Corbus to seek, and reasonably cooperates with Corbus at Corbus expense in seeking, a protective order therefor or other confidential treatment thereof), it shall not use any such information for any purpose other than determining whether Corbus has complied with its obligations hereunder (provided that CFFT may also use information provided through the PAG to further the purposes of the PAG hereunder) or, in the event of the grant of the Interruption License, the exercise thereof, or disclose any such information to any third party, and shall maintain such information in confidence in a manner at least as restrictive as its manner of treating its own confidential information of similar nature and in any event not less than with a reasonable degree of care.
(a) Governing Law. This Agreement shall be governed by and construed in accordance with the internal laws of the State of Maryland.
(b) Dispute Resolution.
(i) In the event of any dispute, claim or controversy arising out of, relating to or in any way connected to the interpretation of any provision of this Agreement, the performance of either party under this Agreement or any other matter under this Agreement, including any action in tort, contract or otherwise, at equity or law (a Dispute), either party may at any time provide the other party written notice specifying the terms of such Dispute in reasonable detail. As soon as practicable after receipt of such notice, an officer of each party shall meet at a mutually agreed upon time and location to engage in good faith discussions for the purpose of resolving such Dispute. If the Dispute is not resolved within thirty (30) days of such notice, either party may institute arbitration in accordance with (ii) below.
(ii) In the event any Dispute is not resolved in accordance with (i) above, such Dispute shall be resolved by final and binding arbitration. Whenever a party decides to institute arbitration proceedings, it shall give written notice to that effect to the other party. Arbitration shall be held in
Washington, D.C., according to the then-current commercial arbitration rules of the Center for Public Resources (CPR), except to the extent such rules are inconsistent with this subparagraph. The arbitration will be conducted by one (1) independent, neutral arbitrator who shall be mutually acceptable to both parties, such acceptance not to be unreasonably withheld, and who shall be appointed in accordance with CPR rules. If the parties are unable to mutually agree on such an arbitrator, then the arbitrator shall be appointed in accordance with CPR rules. Any arbitrator chosen hereunder shall have educational training and industry experience sufficient to demonstrate a reasonable level of relevant scientific, financial, medical and industry knowledge. Within twenty (20) days of the selection of the arbitrator, each party shall submit to the arbitrator a proposed resolution of the Dispute that is the subject of the arbitration (the Proposals). The arbitrator shall thereafter select one of the Proposals so submitted as the resolution of the Dispute, but may not alter the terms of either Proposal and may not resolve the Dispute in a manner other than by selection of one of the submitted Proposals. If a party fails to submit a Proposal, the arbitrator shall select the Proposal of the other party as the resolution of the Dispute. The arbitrator shall agree to render its opinion within thirty (30) days of the final arbitration hearing. No arbitrator shall have the power to award punitive damages regardless of whether any such damages are contained in a Proposal, and such award is expressly prohibited. The proceedings and decisions of the arbitrator shall be confidential, final and binding on all of the parties. Judgment on the award so rendered may be entered in any court having jurisdiction thereof. The parties shall share the costs of arbitration according to the decision of the arbitrator. Nothing in this subparagraph will preclude either party from seeking equitable or injunctive relief, or interim or provisional relief, from a court of competent jurisdiction, including a temporary restraining order, preliminary injunction, or any other form of permanent or interim equitable or injunctive relief, concerning a dispute either prior to or during any arbitration.
(c) This Agreement may be executed in two (2) or more counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same Agreement. Facsimile and other electronically scanned signatures shall have the same effect as their originals.
(d) All communications between the parties with respect to any of the provisions of this Agreement will be sent to the addresses set out below, or to such other addresses as may be designated by one party to the other by notice pursuant hereto, by prepaid, certified air mail (which shall be deemed received by the other party on the seventh (7th) business day following deposit in the mail), or other electronic means of communication (each of which shall be deemed received when transmitted), with confirmation by first class letter, postage pre-paid, given by the close of business on or before the next following business day:
if to CFFT, at:
Robert J. Beall, Ph.D
6931 Arlington Rd., Suite 200
Bethesda, Maryland 20814
with a copy to:
Schaner & Lubitz, PLLC
6931 Arlington Rd., Suite 200
Bethesda, Maryland 20814
Attn: Kenneth I. Schaner, Esq.
if to Corbus, at:
Yuval Cohen, CEO
Corbus Pharmaceuticals, Inc.
100 River Ridge Dive
Norwood, MA 02062
With a copy to:
Lowenstein Sandler LLP
65 Livingston Avenue
Roseland, New Jersey 07068
Attn: Michael J. Lerner, Esq.
(e) The paragraph headings are for convenience only and will not be deemed to affect in any way the language of the provisions to which they refer.
(f) Corbus will not, by amendment of its organizational or governing documents, or through reorganization, recapitalization, consolidation, merger, dissolution, sale, transfer or assignment of assets, issuance of securities, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms, provisions, covenants or agreements of this Agreement.
(g) This Agreement may not be assigned by any party without the consent of the other party, except that either Party may assign this Agreement without such consent to an Affiliate of such party or in connection with the transfer, whether by sale of assets, merger or otherwise, of all or substantially all of the assets or business of such party to which this Agreement relates. Any assignment that is not in accordance with this subparagraph 11(g) will be null and void ab initio.
(h) Nothing herein contained shall be deemed to create an agency, joint venture, amalgamation, partnership or similar relationship between CFFT and Corbus. Notwithstanding any of the provisions of this Agreement, neither party to this Agreement shall at any time enter into, incur, or hold itself out to third parties as having authority to enter into or incur, on behalf of the other party, any commitment, expense, or liability whatsoever, and all contracts, expenses and liabilities in connection with or relating to the obligations of each party under this Agreement shall be made, paid, and undertaken exclusively by such party on its own behalf and not as an agent or representative of the other.
(i) Corbus shall submit any proposed press release or other public announcement, other than an academic, scholarly, or scientific publication, concerning the terms of this Agreement or this Award to the Public Affairs Department of CFFT prior to its public release with sufficient time prior to its public release to allow for review and comment, except to the extent any such release or announcement is required by law, rule, or regulation or the rules of any securities exchange. CFFTs support for the Development Program shall be acknowledged in any publications related to the Development Program.
(j) The parties agree that they intend to advance the body of general scientific knowledge of cystic fibrosis and its potential therapies and cures and the parties acknowledge that Corbus intends to, as commercially and scientifically reasonable based on the results of the Development Program, publish the results of the Development Program in a scientific peer-reviewed publication on a timely basis.
(k) In accordance with the U.S. Department of the Treasury Anti-Terrorist Financing Guidelines, Corbus shall take reasonable steps to ensure that the payments received from CFFT are not distributed to terrorists or their support networks or used for activities that support terrorism or terrorist organizations and Corbus shall periodically apprise CFFT of the steps taken to meet this goal. Corbus certifies that it is in compliance with all laws, statutes and regulations restricting U.S. persons from dealing with any individuals, entities, or groups subject to Office of Foreign Assets Control (OFAC) sanctions.
(l) Corbus shall provide CFFT on the effective date with a description of its other sources of support and update that description from time to time during the Development Program.
(m) Corbus shall provide CFFT with a copy of its public filings, such as annual reports, with governmental units from time to time during the Development Program.
(a) Unless otherwise defined in this letter, the following shall apply:
Actual Award means the total amount of the Award actually paid to Corbus.
Affiliate shall mean, with respect to a party, any entity, which directly or indirectly controls, is controlled by, or is under common control with, such party. For these purposes, control shall refer to (a) the ownership, directly or indirectly, of at least fifty percent (50%) of the voting securities or other ownership interest of an entity; or (b) the possession, directly or indirectly, of the power to direct the management or policies of an entity, whether through the ownership of voting securities, by contract or otherwise.
Change of Control Transaction shall mean the consummation of a transaction, whether in a single transaction or in a series of related and substantially contemporaneous transactions, constituting (i) a merger, share exchange or other reorganization, (ii) the sale by one or more stockholders of a majority of the voting power of Corbus, or (iii) a sale of all or substantially all of the assets of Corbus (or that portion of its assets related to the subject matter of this Agreement), in which the stockholders of Corbus immediately prior to such transaction do not own a majority of the voting power of the acquiring, surviving or successor entity, as the case may be; provided that a Change of Control shall not include a bona fide financing transaction for the benefit of Corbus (i.e in which Corbus raises capital for general working or business purposes) in which voting control of Corbus transfers to one or more persons or entities who acquire shares of Corbus, and the existing Corbus shareholders receive no consideration directly or indirectly in connection with the transaction.
Commercially Reasonable Efforts or CRE shall mean the level of effort, expertise and resources that is substantially and materially consistent with industry standards for companies of similar size and financial resources to research, develop and commercialize the Product, provided such research, development and commercialization is technically feasible, devoting the degree of attention and diligence to such efforts that is substantially and materially consistent with industry standards for a product at a comparable stage in development, with similar market potential, and taking into account, without limitation, issues of safety and efficacy, proprietary position, the competitive environment, the regulatory environment, and other relevant scientific, technical and commercial factors, and for companies of similar size and financial resources.
Corbus Development Program Technology shall mean all technology, in whole or in part, discovered, developed, or controlled, by Corbus or its Affiliates, as a result of the Development Program under this Agreement in the Field (solely for purposes of the Interruption License), including, without limitation, technology owned or controlled by Corbus prior to Corbus performance of the Development Program under this Agreement to the extent necessary in the performance of the Development Program under this Agreement. Without limitation, Corbus Development Program Technology shall include data, technical information, source codes, know-how, inventions (whether or not patented), trade secrets, laboratory notebooks, and processes and methods.
Field shall mean the treatment in humans of cystic fibrosis, asbestosis, bronchiectasis, byssinosis, chronic bronchitis/COPD hypersensitivity pneumonitis, pneumoconiosis, primary ciliary dyskinsesis, sarcoidosis and silicosis.
Interest shall mean the prime rate applicable during the relevant time period, as published in the Wall Street Journal, plus five (5) percentage points.
Interruption shall mean the cessation of Commercially Reasonable Efforts to develop a Product for more than three hundred sixty (360) consecutive days at any time before the first commercial sale of the Product. For clarity, delays resulting from events outside of Corbus reasonable control (e.g., technical difficulties, shortages of supplies or materials, delays in preclinical or clinical studies or regulatory processes, etc.) will not be deemed cessation of Commercially Reasonable Efforts.
Net Sales shall mean, for any period, the gross amount received for sales of the Product in the Field by Corbus or any Corbus Affiliate, sublicensee or transferee as applicable (a Selling Person), to a non-Affiliate of the Selling Person, less the following deductions, in each case to the extent specifically related to the Product and taken by the Selling Person or otherwise paid for or accrued by the Selling Person (Permitted Deductions):
trade, cash, promotional and quantity discounts and inventory management fees paid to wholesalers;
tariffs, duties, excises and taxes on sales (including sales or use taxes or value added taxes) to the extent imposed upon and paid directly with respect to such sales (and excluding national, sales or local taxes based on income);
freight, insurance, packing costs and other transportation charges allocated to the sale;
invoiced amounts that are written off as uncollectible in accordance with Selling Persons accounting policies, consistently applied;
amounts repaid or credits taken by reason of damaged goods, rejections, defects, expired dating, recalls or returns or because of retroactive price reductions, billing errors, or trial prescriptions;
charge back payments, rebates and discounts granted to (i) managed healthcare organizations, (ii) federal, state or provincial or local governments or other agencies, (iii) purchasers and reimbursers or (iv) trade customers, including wholesalers and chain and pharmacy buying groups;
discounts paid under state legislated or seller-sponsored discount prescription drug programs or reductions for coupon and voucher programs; and
documented custom duties actually paid by the Selling Person.
Sales of the Product between or among Corbus and its Affiliates and sublicensees for resale, or for use in the production or manufacture of the Product, shall not be included within Net Sales; provided, however, that any subsequent sale of the Product (or any Product produced or manufactured using the Product) by Corbus or its Affiliate or sublicensee or transferee to another non-Affiliate third party shall be included within Net Sales. Net Sales shall exclude any sale or other distribution for use in a clinical trial or other Development activity, for compassionate or named-patient use or for test marketing.
Product shall mean the Resunab oral anti-inflammatory product in any form, dosage or preparation in finished form, and any derivative or combination product thereof for use in the Field.
Royalty Cap shall mean five (5) times the Actual Award.
We are pleased to make the Award described in this Agreement. Please indicate your agreement to the terms set forth in this Agreement by signing below.
Cystic Fibrosis Foundation Therapeutics, Inc.
|Name: Robert J. Beall, Ph.D.|
|Title: President and CEO|
|Corbus Pharmaceuticals, Inc.|
|Name: Yuval Cohen|
|Title: President and Chief Executive Officer|
Development Program Plan and Budget
EXHIBIT A DEVELOPMENT PLAN
I. SPECIFIC CLAIMS
JBT-101 (ResunabTM) is a synthetic endocannabinoid mimetic agonist that specifically binds the cannabinoid receptor type 2 (CB2) to activate resolution of inflammation. JBT-101 is being developed as a novel therapeutic designed to positively impact chronic inflammation in cystic fibrosis (CF), and, as a result, reduce acute pulmonary exacerbations, improve lung function, slow lung fibrosis, and improve quality of life in CF patients. Due to the compelling need for such a medicine in CF, the goal of this project is to develop JBT-101 for the treatment of adults [*] with CF.
The overall aim of this project is to generate clinical proof of concept data pin adults with CF to enable a decision on the advancement of JBT-101 into global phase 2b/3 clinical testing in adults [*]. The specific aims are:
[*][Note: Approximately three pages of this Exhibit A for which confidential treatment has been requested have been omitted and filed separately with the Securities and Exchange Commission.]
Payments shall be made by CFFT are due [*] upon receipt from Corbus of the corresponding invoice and supporting documentation verifying occurrence of such milestone and PAG verification.