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As filed with the United States Securities and Exchange Commission on March 26, 2013

Registration No. 333-187356

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549



AMENDMENT NO. 1
TO
FORM F-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933



GW PHARMACEUTICALS PLC
(Exact name of Registrant as specified in its charter)
Not Applicable
(Translation of Registrant's name into English)

 
   
   
England and Wales
(State or other jurisdiction of
incorporation or organization)
  2834
(Primary Standard Industrial
Classification Code Number)
  Not Applicable
(I.R.S. Employer
Identification Number)

Porton Down Science Park, Salisbury
Wiltshire, SP4 0JQ
United Kingdom
(44) 198 055-7000
(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant's Principal Executive Offices)



CT Corporation System
111 Eighth Avenue, 13th Floor
New York, NY 10011
(212) 590-9330
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent For Service)



Copies to:

 
   
   
Edward S. Best
David S. Bakst
Mayer Brown LLP
1675 Broadway
New York, NY 10019
Telephone: (212) 506 2500
Facsimile: (212) 262 1910
  Justin D. Gover, Chief Executive Officer
Adam D. George, Chief Financial Officer
GW Pharmaceuticals plc
Porton Down Science Park, Salisbury
Wiltshire, SP4 0JQ
United Kingdom
Telephone: (44) 198 055-7000
Facsimile: (44) 198 055-7111
  Jonathan L. Kravetz
Daniel T. Kajunski
Mintz, Levin, Cohn, Ferris,
Glovsky and Popeo, P.C.
One Financial Center
Boston, MA 02111
Telephone: (617) 542-6000
Facsimile: (617) 542-2241

          Approximate date of commencement of proposed sale to the public:

          As soon as practicable after the effective date of this registration statement.

          If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box.    o

          If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

          If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

          If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o



CALCULATION OF REGISTRATION FEE

       
 
Title of each class of securities to be registered
  Proposed maximum
aggregate offering
price(1)

  Amount of
registration fee(2)

 

Ordinary Shares, par value £0.001 per share(2)(3)

  $50,000,000   $6,820

 

(1)
Estimated solely for the purpose of determining the amount of registration fee in accordance with Rule 457(o) under the Securities Act of 1933, as amended.

(2)
Registration fee has been previously paid in connection with the initial filing of this Registration Statement.

(3)
Includes ordinary shares that the underwriters may purchase solely to cover overallotments, if any.

(4)
American Depositary Shares issuable on deposit of the ordinary shares registered hereby have been registered under a separate registration statement on Form F-6 (File No.: 333-        ). Each American depositary share will represent             ordinary shares.



          The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Commission, acting pursuant to such Section 8(a), may determine.

   



Explanatory Note

        GW Pharmaceuticals plc is filing this Amendment No. 1 (this "Amendment") to its Registration Statement on Form F-1 (Registration No. 333-187356) (the "Registration Statement") as an exhibit-only filing to file Exhibits 10.1 through 10.30 and 10.35 and to amend and restate the list of exhibits set forth in Item 8 of Part II of the Registration Statement. No changes have been made to Part I or Part II of the Registration Statement other than this explanatory note as well as revised versions of the cover page and Item 8 of Part II of the Registration Statement. This Amendment does not contain a copy of the preliminary prospectus included in the Registration Statement, nor is it intended to amend or delete any part of the preliminary prospectus.



Part II
INFORMATION NOT REQUIRED IN THE PROSPECTUS

Item 6.    Indemnification of directors and officers

        The Registrant's articles of association provide that, subject to the Companies Act 2006, every person who is or was at any time a director or other officer (excluding an auditor) of the Registrant may be indemnified out of the assets of the Registrant against all costs, charges, expenses, losses or liabilities incurred by him in performing his duties or the exercise of his powers or otherwise in relation to or in connection with his duties, powers or office.

        The Registrant also maintains directors and officers insurance to insure such persons against certain liabilities.

        In the underwriting agreement, the underwriters will agree to indemnify, under certain conditions, the Registrant, members of the Registrant's board of directors, members of the executive management board and persons who control the Registrant within the meaning of the Securities Act, against certain liabilities.

Item 7.    Recent sales of unregistered securities

        The following information is furnished with regard to all securities issued by the Registrant within the last three years that were not registered under the Securities Act. The issuance of such shares was deemed exempt from registration requirements of the Securities Act as such securities were offered and sold outside of the United States to persons who were neither citizens nor residents of the United States or such sales were exempt from registration under Section 4(a)(2) of Securities Act.

        No underwriter or underwriting discount or commission was involved in any of the issuances set forth in this Item 7.

Options to Purchase Ordinary Shares

        From October 1, 2009 through February 22, 2013, the Registrant issued an aggregate of 3,394,483 options to purchase ordinary shares under its equity incentive plans. Of these options:

Item 8.    Exhibits

(a)
The following documents are filed as part of this Registration Statement:

Exhibit
Number
  Description of Exhibit
  1.1 (1) Form of Underwriting Agreement.

 

3.1

*

Memorandum & Articles of Association of GW Pharmaceuticals plc.

 

4.1

*

Form of specimen certificate evidencing ordinary shares.

 

4.2

(2)

Form of Deposit Agreement among GW Pharmaceuticals plc, Citibank, N.A., as the depositary bank and all Holders and Beneficial Owners of ADSs issued thereunder.

 

4.3

(2)

Form of American Depositary Receipt (included in Exhibit 4.2).

 

4.4

*

Share Warrant to subscribe for ordinary shares issued to Biomedical Value Fund, L.P. dated August 2009.

II-1


Exhibit
Number
  Description of Exhibit
  4.5 * Share Warrant to subscribe for ordinary shares issued to Biomedical Value Fund, L.P. dated August 2009.

 

4.6

*

Share Warrant to subscribe for ordinary shares issued to Biomedical Offshore Value Fund, L.P. dated August 2009.

 

4.7

*

Share Warrant to subscribe for ordinary shares issued to Biomedical Offshore Value Fund, L.P. dated August 2009.

 

5.1

(1)

Opinion of Mayer Brown International LLP as to the validity of the securities being offered under the laws of GW Pharmaceuticals plc's jurisdiction of organization.

 

10.1


License and Distribution Agreement between Bayer AG Division Pharma and GW Pharma Ltd., dated May 20, 2003.

 

10.2


Amendment Number 1 to the License and Distribution Agreement, dated November 4, 2003.

 

10.3

 

Amendment Number 2 to the License and Distribution Agreement between GW Pharma Ltd. and Bayer Healthcare AG Division Pharma, dated January 14, 2004.

 

10.4


Amendment Number 3 to the License and Distribution Agreement between GW Pharma Ltd. and Bayer Healthcare AG Division Pharma, dated March 1, 2005.

 

10.5


Amendment Number 4 to the License and Distribution Agreement between GW Pharma Ltd. and Bayer Healthcare AG Division Pharma, dated May 10, 2005.

 

10.6

 

Amendment Number 5 to the License and Distribution Agreement between GW Pharma Ltd. and Bayer Schering Pharma AG (fka Bayer AG, Bayer HealthCare, Division Pharma), dated March 10, 2010.

 

10.7


Supply Agreement between Bayer AG and GW Pharma Ltd., dated May 20, 2003.

 

10.8


Amendment Number 1 to the Supply Agreement between GW Pharma Ltd. and Bayer Healthcare AG, dated November 4, 2003.

 

10.9


Amendment Number 2 to the Supply Agreement between GW Pharma Ltd. and Bayer Healthcare AG, dated May 10, 2005.

 

10.10


Amendment Number 3 to the Supply Agreement between GW Pharma Ltd. and Bayer Schering Pharma AG (fka Bayer AG, Bayer HealthCare, Division Pharma), dated March 10, 2010.

 

10.11


Product Commercialisation and Supply Consolidated Agreement between GW Pharma Limited and Almirall Prodesfarma, S.A., dated June 6, 2006.

 

10.12


Amendment No. 1 to the Product Commercialisation and Supply Consolidated Agreement between GW Pharma Ltd. and Laboratorios Almirall S.A., dated March 4, 2009.

 

10.13


Amendment to the Product Commercialisation and Supply Consolidated Agreement, dated June 6, 2006 between GW Pharma Ltd. and Almirall S.A., dated July 23, 2010.

 

10.14


Supplementary Agreement to the Product Commercialisation and Supply Consolidated Agreement, dated June 6, 2006 between GW Pharma Ltd. and Almirall S.A., dated November 17, 2011.

 

10.15


Amendment and Supplementary Agreement to the Product Commercialisation and Supply Consolidated Agreement, dated June 6, 2006 between GW Pharma Ltd. and Almirall S.A., dated March 13, 2012.

II-2


Exhibit
Number
  Description of Exhibit
  10.16   Research Collaboration and Licence Agreement between GW Pharma Ltd. and GW Pharmaceuticals plc and Otsuka Pharmaceutical Co., Ltd., dated July 9, 2007.

 

10.17


Amendment No. 1 to Research Collaboration and Licence Agreement, dated March 14, 2008.

 

10.18


Amendment No. 2 to Research Collaboration and Licence Agreement, dated June 29, 2010.

 

10.19


Development and License Agreement between GW Pharma Ltd. and GW Pharmaceuticals Plc and Otsuka Pharmaceutical Co., Ltd., dated February 14, 2007.

 

10.20


Amendment No. 1 to Development and License Agreement, dated November 1, 2008.

 

10.21


Letter amending Development and License Agreement, dated October 21, 2010.

 

10.22


Distribution and License Agreement, dated April 8, 2011, by and between GW Pharma Ltd. and Novartis Pharma AG.

 

10.23


Manufacturing and Supply Agreement, dated November 9, 2011, by and between Novartis Pharma AG and GW Pharma Ltd.

 

10.24


Production Supply Agreement, dated March 7, 2007.

 

10.25


Lease, dated July 6, 2009.

 

10.26


Lease, dated October 9, 2009.

 

10.27


Lease, dated April 6, 2011.

 

10.28


Lease, dated October 12, 2011.

 

10.29


Lease, dated January 6, 2012.

 

10.30


Agreement for Lease, dated April 4, 2012.

 

10.31

*

Occupational Underlease, dated August 11, 2010.

 

10.32

*

Lease, dated May 24, 2011.

 

10.33

*

Tenancy Agreement, dated November 19, 2012.

 

10.34

*

Service Agreement by and between GW Pharma Ltd., and Adam George, dated June 1, 2012.

 

10.35


Service Agreement by and between GW Pharma Ltd., and Chris Tovey, dated July 11, 2012.

 

10.36

*

Service Agreement by and between GW Research Ltd. and Dr. Geoffrey Guy, dated March 14, 2013.

 

10.37

*

Service Agreement by and between GW Research Ltd. and Justin Gover, dated February 26, 2013.

 

10.38

*

Service Agreement by and between GW Research Ltd. and Dr. Stephen Wright, dated January 18, 2013.

 

10.39

*

Letter of Appointment by and between GW Pharmaceuticals plc and James Noble, dated February 26, 2013.

 

10.40

*

Letter of Appointment by and between GW Pharmaceuticals plc and Tom Lynch, dated February 26, 2013.

 

10.41

*

Letter of Appointment by and between GW Pharmaceuticals plc and Cabot Brown, dated February 19, 2013.

II-3


Exhibit
Number
  Description of Exhibit
  10.42 * Long Term Incentive Plan.

 

10.43

*

GW Pharmaceuticals All Employee Share Scheme.

 

10.44

*

GW Pharmaceuticals Approved Share Option Scheme 2001.

 

10.45

*

GW Pharmaceuticals Unapproved Share Option Scheme 2001.

 

21.1

*

List of Subsidiaries.

 

23.1

*

Consent of Deloitte LLP.

 

23.2

(1)

Consent of Mayer Brown International LLP (included in Exhibit 5.1).

 

24.1

(1)

Powers of Attorney (included in the signature page to this Registration Statement).

*
Previously filed.

Confidential treatment requested.

(1)
To be filed in an amendment to this registration statement prior to effectiveness.

(2)
Incorporated by reference to the Registration Statement on Form F-6 (File No. 333-            ), filed with the Securities and Exchange Commission with respect to ADSs representing ordinary shares.
(b)
Financial Statement Schedules

        All Schedules have been omitted because the information required to be presented in them is not applicable or is shown in the consolidated financial statements or related notes.

Item 9.    Undertakings

(a)
The undersigned Registrant hereby undertakes to provide to the underwriters at the closing specified in the underwriting agreements, certificates in such denominations and registered in such names as required by the underwriters to permit prompt delivery to each purchaser.

(b)
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer, or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question of whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

(c)
The undersigned Registrant hereby undertakes that:

(1)
For purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this Registration Statement in reliance upon Rule 430A and contained in a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this Registration Statement as of the time it was declared effective.

(2)
For the purpose of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new Registration Statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

II-4


SIGNATURES

        Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form F-1 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Salisbury, England, on March 26, 2013.


 

 

GW PHARMACEUTICALS PLC

 

 

By:

 

/s/ ADAM GEORGE  
       
Name:  Adam George
Title:    Chief Financial Officer

        Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.

Signature
 
Title
 
Date

 

 

 

 

 

 

 
*

Justin Gover
  Chief Executive Officer (Principal Executive Officer) and Director   March 26, 2013

/s/ ADAM GEORGE

Adam George

 

Chief Financial Officer (Principal Financial and Accounting Officer) and Director

 

March 26, 2013

*

Dr. Geoffrey Guy

 

Director

 

March 26, 2013

*

Dr. Stephen Wright

 

Director

 

March 26, 2013

*

Chris Tovey

 

Director

 

March 26, 2013

*

James Noble

 

Director

 

March 26, 2013

*

Cabot Brown

 

Director and Authorized U.S. Representative

 

March 26, 2013

*

Thomas Lynch

 

Director

 

March 26, 2013

*By:


 

/s/ ADAM GEORGE

Adam George
Attorney-in-Fact

 

 

 

 

II-5


EXHIBIT INDEX

Exhibit
Number
  Description of Exhibit
  1.1 (1) Form of Underwriting Agreement.

 

3.1

*

Memorandum & Articles of Association of GW Pharmaceuticals plc.

 

4.1

*

Form of specimen certificate evidencing ordinary shares.

 

4.2

(2)

Form of Deposit Agreement among GW Pharmaceuticals plc, Citibank, N.A., as the depositary bank and all Holders and Beneficial Owners of ADSs issued thereunder.

 

4.3

(2)

Form of American Depositary Receipt (included in Exhibit 4.2).

 

4.4

*

Share Warrant to subscribe for ordinary shares issued to Biomedical Value Fund, L.P. dated August 2009.

 

4.5

*

Share Warrant to subscribe for ordinary shares issued to Biomedical Value Fund, L.P. dated August 2009.

 

4.6

*

Share Warrant to subscribe for ordinary shares issued to Biomedical Offshore Value Fund, L.P. dated August 2009.

 

4.7

*

Share Warrant to subscribe for ordinary shares issued to Biomedical Offshore Value Fund, L.P. dated August 2009.

 

5.1

(1)

Opinion of Mayer Brown International LLP as to the validity of the securities being offered under the laws of GW Pharmaceuticals plc's jurisdiction of organization.

 

10.1


License and Distribution Agreement between Bayer AG Division Pharma and GW Pharma Ltd., dated May 20, 2003.

 

10.2


Amendment Number 1 to the License and Distribution Agreement, dated November 4, 2003.

 

10.3

 

Amendment Number 2 to the License and Distribution Agreement between GW Pharma Ltd. and Bayer Healthcare AG Division Pharma, dated January 14, 2004.

 

10.4


Amendment Number 3 to the License and Distribution Agreement between GW Pharma Ltd. and Bayer Healthcare AG Division Pharma, dated March 1, 2005.

 

10.5


Amendment Number 4 to the License and Distribution Agreement between GW Pharma Ltd. and Bayer Healthcare AG Division Pharma, dated May 10, 2005.

 

10.6

 

Amendment Number 5 to the License and Distribution Agreement between GW Pharma Ltd. and Bayer Schering Pharma AG (fka Bayer AG, Bayer HealthCare, Division Pharma), dated March 10, 2010.

 

10.7


Supply Agreement between Bayer AG and GW Pharma Ltd., dated May 20, 2003.

 

10.8


Amendment Number 1 to the Supply Agreement between GW Pharma Ltd. and Bayer Healthcare AG, dated November 4, 2003.

 

10.9


Amendment Number 2 to the Supply Agreement between GW Pharma Ltd. and Bayer Healthcare AG, dated May 10, 2005.

 

10.10


Amendment Number 3 to the Supply Agreement between GW Pharma Ltd. and Bayer Schering Pharma AG (fka Bayer AG, Bayer HealthCare, Division Pharma), dated March 10, 2010.

II-7


Exhibit
Number
  Description of Exhibit
  10.11   Product Commercialisation and Supply Consolidated Agreement between GW Pharma Limited and Almirall Prodesfarma, S.A., dated June 6, 2006.

 

10.12


Amendment No. 1 to the Product Commercialisation and Supply Consolidated Agreement between GW Pharma Ltd. and Laboratorios Almirall S.A., dated March 4, 2009.

 

10.13


Amendment to the Product Commercialisation and Supply Consolidated Agreement, dated June 6, 2006 between GW Pharma Ltd. and Almirall S.A., dated July 23, 2010.

 

10.14


Supplementary Agreement to the Product Commercialisation and Supply Consolidated Agreement, dated June 6, 2006 between GW Pharma Ltd. and Almirall S.A., dated November 17, 2011.

 

10.15


Amendment and Supplementary Agreement to the Product Commercialisation and Supply Consolidated Agreement, dated June 6, 2006 between GW Pharma Ltd. and Almirall S.A., dated March 13, 2012.

 

10.16


Research Collaboration and Licence Agreement between GW Pharma Ltd. and GW Pharmaceuticals plc and Otsuka Pharmaceutical Co., Ltd., dated July 9, 2007.

 

10.17


Amendment No. 1 to Research Collaboration and Licence Agreement, dated March 14, 2008.

 

10.18


Amendment No. 2 to Research Collaboration and Licence Agreement, dated June 29, 2010.

 

10.19


Development and License Agreement between GW Pharma Ltd. and GW Pharmaceuticals Plc and Otsuka Pharmaceutical Co., Ltd., dated February 14, 2007.

 

10.20


Amendment No. 1 to Development and License Agreement, dated November 1, 2008.

 

10.21


Letter amending Development and License Agreement, dated October 21, 2010.

 

10.22


Distribution and License Agreement, dated April 8, 2011, by and between GW Pharma Ltd. and Novartis Pharma AG.

 

10.23


Manufacturing and Supply Agreement, dated November 9, 2011, by and between Novartis Pharma AG and GW Pharma Ltd.

 

10.24


Production Supply Agreement, dated March 7, 2007.

 

10.25


Lease, dated July 6, 2009.

 

10.26


Lease, dated October 9, 2009.

 

10.27


Lease, dated April 6, 2011.

 

10.28


Lease, dated October 12, 2011.

 

10.29


Lease, dated January 6, 2012.

 

10.30


Agreement for Lease, dated April 4, 2012.

 

10.31

*

Occupational Underlease, dated August 11, 2010.

 

10.32

*

Lease, dated May 24, 2011.

 

10.33

*

Tenancy Agreement, dated November 19, 2012.

 

10.34

*

Service Agreement by and between GW Pharma Ltd., and Adam George, dated June 1, 2012.

II-8


Exhibit
Number
  Description of Exhibit
  10.35   Service Agreement by and between GW Pharma Ltd., and Chris Tovey, dated July 11, 2012.

 

10.36

*

Service Agreement by and between GW Research Ltd. and Dr. Geoffrey Guy, dated March 14, 2013.

 

10.37

*

Service Agreement by and between GW Research Ltd. and Justin Gover, dated February 26, 2013.

 

10.38

*

Service Agreement by and between GW Research Ltd. and Dr. Stephen Wright, dated January 18, 2013.

 

10.39

*

Letter of Appointment by and between GW Pharmaceuticals plc and James Noble, dated February 26, 2013.

 

10.40

*

Letter of Appointment by and between GW Pharmaceuticals plc and Tom Lynch, dated February 26, 2013.

 

10.41

*

Letter of Appointment by and between GW Pharmaceuticals plc and Cabot Brown, dated February 19, 2013.

 

10.42

*

Long Term Incentive Plan.

 

10.43

*

GW Pharmaceuticals All Employee Share Scheme.

 

10.44

*

GW Pharmaceuticals Approved Share Option Scheme 2001.

 

10.45

*

GW Pharmaceuticals Unapproved Share Option Scheme 2001.

 

21.1

*

List of Subsidiaries.

 

23.1

*

Consent of Deloitte LLP.

 

23.2

(1)

Consent of Mayer Brown International LLP (included in Exhibit 5.1).

 

24.1

(1)

Powers of Attorney (included in the signature page to this Registration Statement).

*
Previously filed.

Confidential treatment requested.

(1)
To be filed in an amendment to this registration statement prior to effectiveness.

(2)
Incorporated by reference to the Registration Statement on Form F-6 (File No. 333-            ), filed with the Securities and Exchange Commission with respect to ADSs representing ordinary shares.

II-9




QuickLinks

Explanatory Note
Part II INFORMATION NOT REQUIRED IN THE PROSPECTUS

Exhibit 10.1

 

***Text Omitted and Filed Separately with the Securities and Exchange Commission.

Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406

 

 

BAYER AG

 

and

 

GW PHARMA LTD

 

 

 

 

LICENSE AND DISTRIBUTION AGREEMENT

 

 

 



 

CONTENTS

 

 

 

 

 

1. DEFINITIONS AND INTERPRETATION

 

3

2. GRANT OF RIGHTS TO THE PRODUCTS

 

7

3. TERRITORY OPTION PROCEDURE

 

7

4. PAYMENTS

 

8

5. DEVELOPMENT OBLIGATIONS

 

9

6. COMMERCIALISATION OBLIGATIONS

 

9

7. REGULATORY OBLIGATIONS

 

11

8. CONFIDENTIALITY AND ANNOUNCEMENTS

 

13

9. INTELLECTUAL PROPERTY OWNERSHIP, PATENT PROSECUTION AND LITIGATION

 

15

10. TRADEMARKS AND PRODUCT MARKING

 

16

11. STATEMENTS AND REMITTANCES

 

18

12. TERM AND TERMINATION

 

18

13. RIGHTS AND DUTIES UPON TERMINATION

 

20

14. WARRANTIES AND REPRESENTATIONS

 

20

15. INDEMNITIES AND LIMITATION; INSURANCE

 

21

16. FORCE MAJEURE; HARDSHIP

 

22

17. GOVERNING LAW AND DISPUTE RESOLUTION

 

22

18. WAIVER OF BREACH

 

23

19. SEVERABILITY

 

23

20. ENTIRE AGREEMENT

 

23

21. NOTICES

 

24

22. ACQUISITION OR MERGER OF BAYER PHARMACEUTICAL BUSINESS AND ASSIGNMENT

 

24

23. THIRD PARTY RIGHTS

 

25

24. COUNTERPARTS

 

25

APPENDIX 1 - PRODUCTS

 

26

APPENDIX 2 - TERRITORY

 

27

APPENDIX 3 - LAUNCH CONDITIONS, UPFRONTS, MILESTONE EVENTS and PAYMENTS

 

28

APPENDIX 4 - GW IPR

 

30

APPENDIX 5 - TRADE MARK

 

31

 

2



 

LICENSE AND DISTRIBUTION AGREEMENT

 

THIS LICENSE AND DISTRIBUTION AGREEMENT (hereinafter “Agreement”), is made as of the 20th day of May 2003, between GW PHARMA LIMITED (“GW”) having its registered office at Porton Down Science Park, Salisbury, Wiltshire SP4 0JQ and BAYER AG, Bayer HealthCare, Division Pharma, having its registered office at Bayerwerk, 51368 Leverkusen, Germany (“Bayer”).

 

WHEREAS, GW is the owner of all right, title and interest in certain patents and know-how relating to certain cannabinoid products and desires to grant a licence to the rights to sell and distribute such cannabinoid products in the Territory;

 

WHEREAS, Bayer and its Affiliates have experience in the market development, marketing, promotion and sale of pharmaceutical products and desire to obtain a licence to the rights to sell and distribute such cannabinoid products in the Territory and GW is willing to grant to Bayer such rights;

 

WHEREAS, Bayer and GW entered into a Non-Disclosure Agreement on 27 December 2002; and

 

WHEREAS, Bayer and GW entered into a Supply Agreement, a Loan Agreement and a Subscription Option Agreement as of the date hereof.

 

NOW, THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:

 

1.                                     DEFINITIONS AND INTERPRETATION

 

1.1.                            “Adverse Event Reporting” shall mean the procedure relating to drug safety and/or pharmacovigilance concerning Products as separately agreed upon between the Parties.

 

1.2.                            “Affiliates” shall mean any corporation or other entity which is directly or indirectly controlling, controlled by or under common control of a Party hereto for so long as such control exists. For the purposes of this definition “control” shall mean the direct or indirect ownership of at least fifty per cent (50%) of the outstanding shares or other voting rights of the subject entity having the power to vote on or direct the affairs of the entity.

 

1.3.                            “Background Rights” shall mean the Intellectual Property Rights and rights of a similar nature owned by each of the parties as at the Effective Date.

 

1.4.                            “CBD” shall mean cannabidiol.

 

1.5.                            “Contract Governance Committee” shall mean the committee with overall responsibility for the management of this Agreement comprising two (2) senior management representatives from each of Bayer and GW.

 

1.6.                            “Controlled Drugs Authority” shall mean the UK Home Office and any equivalent body responsible within the Territory in relation to the control, licensing or supervision of controlled or similarly restricted drugs.

 

1.7.                            “Country Commercialisation Committee(s)” shall mean the committee responsible in each country of the Territory for the strategic commercialisation of the Products each comprising two (2) management representatives from GW and appropriate representation from the marketing function of the relevant Bayer Affiliate. For the avoidance of doubt a management representative may serve on more than one Country Commercialisation Committee.

 

1.8.                            “EEA” shall mean the European Economic Area.

 

1.9.                            “Effective Date” shall mean the date upon which this Agreement is effective and shall be the date of this Agreement first written above.

 

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1.10.                     “Foreground Rights” shall mean the Intellectual Property Rights and rights of a similar nature arising out of all inventions, discoveries and know-how which are made, conceived, reduced to practice or generated by the Parties, their respective employees, agents, or other persons acting under such Parties’ authority in the course of or as a result of this Agreement and relating to the Products.

 

1.11.                     “Good Distribution Practice” shall mean the EC Guidelines of Good Distribution Practice on Medicinal Products for Human Use (2001/83/EC) or equivalent Laws in the Territory.

 

1.12.                     “Governmental Authority” shall mean or include (according to context) a Medicinal Products Regulatory Authority, patent offices, a Treatment Endorsement Body, a Controlled Drugs Authority and any other local or national agency, authority court, tribunal, arbitrator, agency, commission, inspectorate, official or other instrumentality of a government with application within the Territory.

 

1.13.                     “GW IPR” shall mean the Intellectual Property Rights including without limitation GW Patents, GW Know-How and GW Plant Variety Rights owned by or which become owned during the Term of this Agreement by GW or its Affiliates to this Agreement which relate directly to the Products. The GW IPR currently owned by GW or its Affiliates is set out in Appendix 4; Appendix 4 shall be updated any time during the Term of this Agreement upon Bayer’s request from time to time to reflect GW IPR which becomes owned by GW or its Affiliates.

 

1.14.                     “GW Know-how” shall mean all present and future technical information and know-how which relates directly to the Products, which is confidential or is not in the public domain and to which is proprietary to GW and shall include without limitation, all biological, chemical, pharmacological, toxicological, clinical, assay, control and manufacturing data, ideas, concepts, drawings, methods of use or application and any other information necessary for the sale in the Territory of the Products.

 

1.15.                     “GWP” shall mean GW Pharmaceuticals PLC.

 

1.16.                     “GW Patents” shall mean all patents and patent applications relating directly to the Products owned by GW which cover the making, having made, the disposal of, or offer to dispose of, use, offer for sale or sale, including, without limitation, of a process for manufacturing the Products or a starting material or an intermediate or manufacturing equipment used in such process. Included within the definition of GW Patents are all continuations, continuations-in-part, divisions, patents of addition, utility patents, reissues, renewals, re-examination, requests for continued examination, registrations, patents of importation or patent term extensions thereof including SPCs.

 

1.17.                     “GW Plant Variety Right” shall mean a right granted to GW by the Community Plant Variety Office or a national plant variety right office under The International Convention for the Protection of New Varieties of Plants (the UPOV convention) and relating directly to the Products. Within the context of this Agreement, the term GW Plant Variety Right shall include pending applications for such rights as well as granted rights which are still in force.

 

1.18.                     “Indication” shall mean the relief of one or more primary symptoms in patients with multiple sclerosis, the relief of neuropathic pain, the relief of cancer pain and any indication granted by a Medicinal Products Regulatory Authority for Product as a result of Bayer marketing, distributing and selling Product in the Territory and/or as a result of Phase IIIb or Phase IV studies according to Clause 5.3. If not agreed otherwise between the Parties, any other indication for Product approved by a Medicinal Products Regulatory Authority as a result of a development by GW shall be expressly excluded, provided that Bayer shall have a first option on such other indication.

 

1.19.                     “Intellectual Property Rights” shall mean any rights arising or obtainable under laws relating to patents, designs, plant variety rights, know how, copyright, confidential information, trade

 

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secrets, database rights or unfair competition whether known in any country or place under those names, but excluding trade marks.

 

1.20.                     “Launch” shall mean the first commercial sale to a Third Party within a country within the Territory by Bayer or its Affiliates of a Product.

 

1.21.                     “Launch Conditions” shall mean the country-specific terms specified in Appendix 3, when countries are added to the Territory under the Territory Option Procedure.

 

1.22.                     “Laws” shall mean all laws, statutes, rules, regulations, ordinances and other pronouncements having the effect of law of any Governmental Authority in the Territory.

 

1.23.                     “Loan Agreement” shall mean the loan facility agreement dated the same day as this Agreement between Bayer and GWP.

 

1.24.                     “Marketing Authorisation(s)” shall mean the authorisations for the sale and marketing of the Products in the Territory granted by a Medicinal Products Regulatory Authority as may be varied from time to time.

 

1.25.                     “Medicinal Products Regulatory Authority” shall mean the competent authority in the EEA (or in any country thereof), Canada, Australia or New Zealand, or other national authority responsible for the granting and supervision of the Marketing Authorisations within the Territory.

 

1.26.                     “Net Sales” shall mean the aggregated gross amounts invoiced by Bayer in respect of gross sales of the Products in each country of the Territory under this Agreement by Bayer or its Affiliates to Third Parties at an arm’s length open market price less deductions actually allowed in relation to or specifically allocated to the Products by Bayer using generally accepted accounting standards for:

 

(i)                                     ordinary and customary quantity, trade and/or cash discounts actually granted and logistics service provider fees paid and payable;

 

(ii)                                  amounts repaid or credited and allowances including cash or credit, given by reason of retroactive price reductions, or billing errors or rebates actually allowed or paid;

 

(iii)                               amounts refunded or credited for the Products which were rejected, spoiled, damaged, outdated or returned;

 

(iv)                              distribution, packing, handling, freight, shipment and insurance disbursements in transporting the Products to customers;

 

(v)                                 taxes and other governmental charges occurred in connection with sale of the Products; and

 

(vi)                              bad debts excluding any amounts actually recovered including VAT actually written off due to the customer going into insolvency to the extent they are attributable to the Products. In such a case, Bayer shall be entitled to deduct such an amount from gross sales less *** (***) percent of the Net Selling Price, which the Parties hereby agree represents GW’s costs of manufacture, provided always that Bayer had previously paid GW the supply price.

 

1.27.                    “Net Selling Price” shall mean Net Sales per unit of Product.

 

1.28.                     “Option” shall have the meaning given in the Subscription Option Agreement.

 

1.29.                     “Parties” shall mean Bayer and GW (and “Party” shall be construed accordingly).

 

1.30.                     “Products” shall mean the products set out in Appendix 1 to this Agreement for human use in the Indications.

 


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1.31.                     “Promotional Materials” shall mean detailing, promotional, sponsorship, educational and communication materials in hard copy or electronic form for marketing, detailing and promotion of the Products for distribution to a Third Party (including without limitation health professionals) and to Bayer’s sales force.

 

1.32.                     “Quality Agreement” shall mean the agreement to be attached to the Supply Agreement governing the technical aspects of the supply by GW of the Products.

 

1.33.                     Regulatory Collaboration Committee” shall mean the committee comprising two (2) representatives from each of GW and Bayer or its Affiliates in relation to obtaining Marketing Authorisations for the Products.

 

1.34.                     “Sales Targets” shall have the meaning defined in Clause 6.2.

 

1.35.                     “SmPC” shall mean the Summary of Product Characteristics forming part of a Marketing Authorisation.

 

1.36.                     “SPC” shall mean a Supplementary Protection Certificate as defined in Council Regulation (EEC) No 1768/92.

 

1.37.                     “Subscription Option Agreement” shall mean the subscription agreement dated the same day as this Agreement between Bayer and GWP.

 

1.38.                     “Supply Agreement” shall mean the agreement dated the same day as this Agreement between Bayer and GW, as amended or extended from time to time, relating to the supply of the Products.

 

1.39.                     “Supply Price” shall mean the supply price for supply of the Products as detailed in Appendix 2 of the Supply Agreement.

 

1.40.                     “Territory” shall mean the UK Territory and such other certain countries (other countries in the entire EEA, Canada, Australia and New Zealand) as shall be added to the Territory under the Territory Option Procedure and which, upon agreement by the parties in relation thereto, shall be listed in Appendix 2 to this Agreement.

 

1.41.                     “Territory Option Procedure” shall mean the procedure set out in Clause 3 below.

 

1.42.                     “Third Party” shall mean any entity other than GW, GW’s Affiliates, Bayer and Bayer’s Affiliates.

 

1.43.                     “Third Party IPR” shall mean Intellectual Property Rights owned by a Third Party.

 

1.44.                     “Trade Mark(s)” shall mean the trade marks owned by GW and used in relation to the Products listed in Appendix 5 of this Agreement and as updated from time to time.

 

1.45.                     “Treatment Endorsement Body” shall mean a Governmental Authority within the Territory with responsibility or authority for the endorsement and/or reimbursement of the Products within the Territory including without limitation the National Institute for Clinical Excellence, or any successor body.

 

1.46.                    “UK Territory” shall mean the territory of Great Britain, Northern Ireland, the Channel Islands and the Isle of Man.

 

1.47.                     In this Agreement unless it is inconsistent with the context a reference to a statutory provision includes a reference to:

 

(i)                                     a statutory amendment, modification, substitution, consolidation or re-enactment (whether before or after the date of this Agreement);

 

(ii)                                  statutory instruments or subordinate legislation or orders made under the statutory provision; and

 

(iii)                               statutory provisions of which the statutory provision is an amendment, modification, substitution, consolidation or re-enactment.

 

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Unless the context of this Agreement otherwise requires,

 

(i)                                      words of one gender includes the other gender;

 

(ii)                                   words using the singular or plural number also include the plural or singular number respectively;

 

(iii)                                the terms “hereof”, “herein”, “hereby” and derivative or similar words refer to this entire Agreement; and

 

(iv)                               the terms “Clause” and “Appendix” refer to the specified Clause and Appendix of this Agreement.

 

When this Agreement refers to a number of days, unless otherwise specified (as business days in which case reference shall be made to normal UK working days), such number shall refer to calendar days. When this Agreement refers to a number of years and/or months, unless otherwise specified, such number shall refer to calendar years and/or months.

 

2.             GRANT OF RIGHTS TO THE PRODUCTS

 

2.1.                           GW hereby grants to Bayer an exclusive distribution right to sell, offer for sale, market, promote and distribute the Products in the Territory. GW undertakes during the term of this Agreement not itself to sell, dispose of, or offer to dispose of, offer for sale, market, promote and distribute the Products in the Territory or to purport to grant others the right to do so, other than pursuant to Clause 6.6 and Clause 22.1 b).

 

2.2.                           Subject to Clause 2.4, GW hereby grants to Bayer an exclusive license under the GW IPR in the Products strictly to the extent necessary for Bayer to sell, offer for sale, market, promote and distribute the Products in the Territory.

 

2.3.                           Bayer shall be entitled to sub-license any and all of its rights hereunder to its Affiliates for each country of the Territory provided that Bayer shall procure that such Affiliates comply with Bayer’s obligations, liabilities and responsibilities under this Agreement. Bayer and its Affiliates shall be entitled at any time to retain one or more Third Party contract sales force(s) to detail, sell, promote and distribute the Products in any country in the Territory provided that the agreement with such Third Party contract sales force is in compliance with Bayer’s obligations and responsibilities under this Agreement.

 

2.4.                           In the event that GW fails to meet its obligations under Clause 2.1 of the Supply Agreement and the provisions of Clause 8.2.5 of the Supply Agreement apply, then GW will grant to Bayer (only for the duration of GW’s supply problems or Bayer’s out of stock situation, whichever is longer, as envisaged in Clause 8.2.5 of the Supply Agreement) a royalty-free sole licence with the right to sub-license under the GW IPR in relation to the Products in the Territory to manufacture or to have manufactured the Products in accordance with the provisions set out in Clause 8.2 of the Supply Agreement. For the avoidance of doubt ‘sole’ shall mean that the rights under the GW IPR in relation to the Products under this Clause 2.4 may be exercised within the Territory by GW and Bayer, but that GW shall not appoint any other licensee in the Territory in relation to the rights granted under this Clause 2.4 for the duration of the aforementioned sole licence. Bayer shall not be obliged to obtain GW’s prior written consent to a sub-licensee provided that Bayer shall procure that such sub-licensee acts or refrains from acting in such a manner so as to enable Bayer to comply with Bayer’s obligations, liabilities and responsibilities under this Agreement.

 

3.                                     TERRITORY OPTION PROCEDURE

 

3.1.                           As at the Effective Date, the Territory is the UK Territory. At any time between the Effective Date and 30 September 2003 Bayer may opt to add to the Territory certain further countries (from other countries in the EEA, Canada, Australia and New Zealand) and on the agreed respective Launch Conditions to be set out in Part B of Appendix 3 to this Agreement and otherwise subject to the terms of this Agreement, including without

 

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limitation Clause 3.2 below. Failure to agree any respective Launch Conditions by 30 September 2003 will result in GW being free to enter into a binding agreement with one or more Third Parties with respect to such countries unless the Parties shall have mutually agreed in writing to an extension to finalise such terms.

 

3.2.                           For the purposes of calculating the milestone payments attributable to additional countries added to the Territory under the Territory Option Procedure, the total milestone payments with respect to the UK Territory is deemed to be *** pounds sterling (£***). In the event that further countries are added to the Territory in accordance with the procedure set out in Clause 3.1 above, the sums payable with respect to those further countries shall be prorated according the ratio of peak annual sales (to be agreed in writing between the Parties) between the UK Territory and the country(ies) so added, and shall be in the proportions detailed in Appendix 3, Part A2 1 to 3 provided, however, that there shall be no signing fee payable upon addition of further countries to the Territory. By way of example, were a country to be added to the Territory with one half the peak annual sales compared to the UK Territory, the total milestones payable for achievement of the milestones under Part A2 1 to 3 shall be £*** and split between the milestones in the following way: ***.

 

3.3.                           Notwithstanding any specific provision in this Agreement or in the Supply Agreement, the Parties undertake to negotiate in good faith any adjustments to the provisions of this Agreement or the Supply Agreement reasonably requested by either Party for countries added to the Territory under the Territory Option Procedure set out in this Clause 3.

 

4.             PAYMENTS

 

4.1.                           In consideration for the grant by GW to Bayer of the rights under this Agreement in relation to the Products in the UK Territory an amount of five million pounds sterling (£5 million) shall become due on the Effective Date concurrently with the signature of this Agreement. GW shall issue Bayer with an invoice therefor. Within five (5) business days of receipt of such invoice, Bayer shall forward the payment to GW by bank transfer to such GW account as shall be nominated by GW in writing. Subject to Clause 13.1, the said sum shall be non-refundable and non-creditable to Bayer.

 

4.2.                           As further consideration for the grant by GW to Bayer of the rights under this Agreement in relation to the Products in the UK Territory and with respect to countries added to the Territory under the Territory Option Procedure, Bayer shall make payments to GW in the specified incremental amounts and against achievement of the specified milestone events, set out in Appendix 3 to this Agreement, provided that:

 

(i)                                    each milestone event for which payment hereunder shall be made shall have the particular meaning specified in Appendix 3 to this Agreement;

 

(ii)                                 in the event the milestone payment specified in Appendix 3 A1.2 becomes due and payable and Bayer shall exercise the Option pursuant to the Subscription Option Agreement, Bayer shall be released from its obligation to pay the milestone payment specified in Appendix 3 A1.2 by such amount as is equal to the amount by which the aggregate subscription monies Bayer pays to GWP pursuant to Clause 3.2 of the Subscription Option Agreement exceeds the then outstanding balance of monies due under the Loan Agreement at such date (and which have been repaid by way of set-off against Bayer’s obligations arising pursuant to Clause 3.2 of the Subscription Option Agreement in accordance with Clause 6.3 of the Loan Agreement);

 


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(iii)                              a payment for a milestone event shall be made only one time regardless of how many times such milestone event is achieved, and no payment shall be owed for a event which is not reached;

 

(iv)                             more than one milestone payment may be made at a time if more than one milestone event has occurred at the same time;

 

(v)                                subject to Clause 13.1 and Clause 13.2 (iii), each such milestone payment shall be non-refundable and non-creditable to Bayer, provided that milestone payments shall not become due if notice of termination was given by a Party entitled to do so prior to the due date of any such milestone payments;

 

(vi)                             no later than ten (10) business days after the achievement of each milestone event, GW shall notify Bayer in writing of the achievement of same and GW shall issue a suitable invoice therefore. Within fifteen (15) business days of receipt of such invoice, Bayer shall forward the appropriate milestone payment to GW;

 

(vii)                          each payment shall be made in sterling by bank transfer to such GW account as shall be nominated by GW in writing from time to time.

 

4.3.                           All sums herein are expressly stated as exclusive of Value Added Tax or equivalent sales tax applicable in the Territory (“VAT”). If VAT is or may become properly payable or chargeable in respect of any payments hereunder, then GW will promptly provide a valid VAT invoice to Bayer. If the VAT charged to and paid by Bayer is subsequently refunded by any relevant fiscal authorities to GW, then such refund shall be promptly forwarded to Bayer with a valid VAT credit note.

 

5.                                     DEVELOPMENT OBLIGATIONS

 

5.1.                           During the term of this Agreement, GW shall have full control and authority, with full responsibility, over the research and clinical development relating to the Products and, in accordance with Clause 7 below, obtaining Marketing Authorisations of the Products in the Territory, and, other than as provided in Clause 5.3 below, all such activity shall be undertaken at GW’s expense. GW will exercise reasonable efforts and diligence in developing the Products to facilitate Bayer’s obligations to commercialise the same.

 

5.2.                           All clinical or other studies required by any Medicinal Products Regulatory Authority and as essential to secure Marketing Authorisations for the Products in the Territory (for the two indications listed in Appendix 1 and the indication of the relief of cancer pain) shall be undertaken by GW at its own expense.

 

5.3.                           Where clinical or other studies in respect of the Products which are not essential to secure or maintain the Marketing Authorisations are requested in writing by Bayer for commercial purposes or to support a submission to a Treatment Endorsement Body other than in relation to the UK Territory then GW shall undertake such studies at Bayer’s expense. The Parties may agree in writing that Bayer undertakes such studies at its own expense. For the avoidance of doubt, these provisions include all Phase IIIb and Phase IV studies.

 

6.             COMMERCIALISATION OBLIGATIONS

 

6.1.                           Subject to a different decision by the Contract Governance Committee, Bayer shall commence sales of the Products within six (6) months of the grant of Marketing Authorisation for the Products in the UK Territory and within six (6) months of the fulfilment of the Launch Conditions in other countries within the Territory, provided, however, that Bayer was in receipt of Launch stocks of the Products as provided by the Supply Agreement in sufficient time prior to the commencement of sales in accordance with this Clause 6.1 and that Bayer had obtained any other approval required from a Governmental Authority (including without limitation a Controlled Drugs Authority) required to sell the Products in the Territory on a commercial basis.

 

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6.2.                           The Parties shall establish within five (5) business days of the Effective Date in the case of the UK Territory and before 30 September 2003 in the case of each country added to the Territory under the Territory Option Procedure a Country Commercialisation Committee in each country within the Territory. Each Country Commercialisation Committee shall meet upon request by either Party until one (1) year after the Launch on at least a quarterly basis and thereafter on at least a bi-annual basis. In the event of a dispute within a Country Commercialisation Committee, the dispute (except with respect to disputes relating to setting the Sales Targets (as defined below) whereby disputes in relation thereto shall be settled by the procedure set out in Clause 17) will first be referred for resolution to the Contract Governance Committee who will attempt in good faith to resolve the dispute within thirty (30) days from the date that written notice initiating this resolution process is sent to the other Party. In the event that the Contract Governance Committee cannot resolve the dispute, the decision of Bayer shall be final. The duties of each Country Commercialisation Committee shall include the setting and monitoring in good faith of appropriate and reasonable sales performance levels for the country in question for each agreed twelve (12) month sales period (“Sales Targets”).

 

6.3.                           Bayer shall use all reasonable endeavours to meet the Sales Targets.

 

6.4.                           Without prejudice to Clause 6.3 above, Bayer shall and shall procure that its Affiliates market and promote the Products using such efforts as Bayer would use for a product of its own making which has the same technical, regulatory and commercial potential to the Products having reasonable regard at all times to the stage at which the relevant Product has reached in its life cycle and the time that has elapsed since Launch; the number of years remaining to loss of exclusivity; competing products; the regulatory environment and reimbursement status of the Products. Such marketing and promotion shall be in accordance with the valid Marketing Authorisations and any variations thereof applicable from time to time and all applicable Laws in each country of the Territory.

 

6.5.                           Without prejudice and subject to Clauses 6.2 to 6.4 inclusive above, Bayer and its Affiliates shall maintain sufficient resources (either its own employees or through permitted sub-contractors) during the term of this Agreement to detail, sell, distribute and promote the sale of the Products in the Territory.

 

6.6.                           In the event that Bayer may be reasonably considered to have ceased or suspended commercialisation of the Products in one or more countries of the Territory, GW shall raise and reasonably substantiate GW’s complaint within the Country Commercialisation Committee. If such discussion cannot be resolved within the Country Commercialisation Committee, it will be referred for resolution to the Contract Governance Committee who will attempt in good faith to resolve the discussion within thirty (30) days from the date that it was notified accordingly. In the event that the Contract Governance Committee cannot resolve the discussion and that Bayer may be reasonably considered to have ceased or suspended commercialisation of the Products in one or more countries of the Territory, the following shall apply: In the event that (a) Bayer did not achieve in the preceding *** month period prior to the complaints first being raised by GW within the Country Commercialisation Committee total Net Sales levels throughout the countries concerned of at least *** percent (***%) of those Net Sales achieved by Bayer in the *** month period immediately prior to the *** month period specified above, and (b) GW can demonstrate to Bayer’s reasonable satisfaction that such sales development has not been caused by reasons out of Bayer’s or its Affiliate’s control, each and every of the licences and rights granted under this Agreement for such country shall become non-exclusive immediately upon written notice by GW to Bayer to this effect.

 


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In the event that in each of the *** month periods prior to the complaints first being raised by GW within the Country Commercialisation Committee total Net Sales throughout the countries concerned amount to *** percent (***%) or less of the total Net Sales achieved by Bayer in the consecutive *** month periods immediately preceding each of such periods and GW can demonstrate to Bayer’s reasonable satisfaction that this event has not been caused by reasons out of Bayer’s control each and every of the licences and rights granted under this Agreement for such country shall terminate upon written notice by GW to Bayer with immediate effect. For avoidance of doubt, it is understood between the Parties that the foregoing does not apply in the event of *** month period *** month periods.

 

6.7.                           Bayer agrees during the term of this Agreement to comply with, and not to take any action which would be subject to penalty under all Laws applicable to this Agreement in any country within the Territory, and to conduct its business in accordance with all applicable ethical business practices and Good Distribution Practice.

 

6.8.                           Bayer shall at its own cost and expense be responsible for all the preparation and certification of Promotional Materials and marketing, advertising and promoting of the Products in the Territory. Bayer shall provide to GW, through the mechanism of the Country Commercialisation Committee, draft documents containing the key promotional messages forming the basis of Bayer’s core marketing claims at an early stage in Bayer’s preparation of its core marketing claims having regard to GW’s position and responsibilities as Marketing Authorisation holder and in the event of a dispute between the Parties the procedure in Clause 17 below shall apply. The Products, packaging materials and Promotional Materials based on the foregoing key promotional messages shall properly and clearly state that such are sold under license from GW and prior to release in a country of the Territory the finalised Promotional Materials will have been approved in writing by the relevant Country Commercialisation Committee. Bayer shall provide copies of the finalised Promotional Materials to GW as soon as possible. GW will provide Bayer or its Affiliates SmPC text revisions as timely as possible to allow preparation of promotional materials.

 

6.9.                           Without prejudice to the provisions of Clause 6.7 above, Bayer shall ensure that no claims or representations in respect of the Products or the characteristics thereof are made by or on behalf of it (by its agents or subcontractors or otherwise) which do not represent an accurate summary or explanation of the labelling of the Products or SmPC or a portion thereof.

 

6.10.                    Bayer shall comply in all material respects with applicable Laws in each country of the Territory (including without limitation with the Association of the British Pharmaceutical Industry (ABPI) Code of Practice and all regulations under the Medicines Act 1968 (as amended)) in its promotional activities in relation to the Products.

 

6.11.                    Bayer shall not actively seek customers outside the Territory in connection with the Products.

 

7.                                      REGULATORY OBLIGATIONS

 

7.1.                           GW will be solely responsible for applying for (including responding promptly to all requests from the Medicinal Products Regulatory Authority in the Territory in relation to such application) and maintaining the Marketing Authorisations required in each country of the Territory in order to enable the marketing, distribution and sale of the Products. GW will provide to Bayer or its Bayer Affiliates copies of any Marketing Authorisation documentation reasonably necessary to enable Bayer’s Affiliates to meet their obligations as named distributor in the relevant Territory.

 


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7.2.                           Within five (5) business days of the Effective Date the Parties shall establish a Regulatory Collaboration Committee for all regulatory matters relating to Product in the Territory and the countries covered by the Territory Option Procedure. The Regulatory Collaboration Committee shall also consider the strategy for obtaining Marketing Authorisations under the EC mutual recognition procedure in concerned member states and in other countries of the Territory. The Regulatory Collaboration Committee shall meet upon request by either Party until one (1) year after the Launch on at least a quarterly basis and thereafter on at least a semi-annual basis. In the event of a dispute within the Regulatory Collaboration Committee, the dispute (except with respect to disputes relating to the review of proposed submissions according to Clause 7.5 in which case disputes shall be settled by the procedure set out in Clause 17) will first be referred for resolution to the Contract Governance Committee who will attempt in good faith to resolve the dispute within thirty (30) days from the date that written notice initiating this resolution process is sent to the other Party. In the event that the Contract Governance Committee cannot resolve the dispute, the decision of GW shall be final with the exception of decisions that have a significant impact on the commercialisation of the Product in the Territory.

 

7.3.                           GW and Bayer or its Affiliates shall share responsibility for submissions to any Treatment Endorsement Bodies in the UK Territory in respect of the Products provided that the Parties shall each contribute *** percent (***%) of costs reasonably incurred in obtaining an endorsement in relation to any of the Products from the relevant Treatment Endorsement Body. In relation to submissions to Treatment Endorsement Bodies in any other country of the Territory these will be made by, and at the sole expense of Bayer. Each applicant to a Treatment Endorsement Body shall use its reasonable endeavours to secure as far as is possible endorsement which is mutually satisfactory to each of the Parties in relation to the use of the Products PROVIDED ALWAYS THAT if there is no or insufficient clinical or other data to support such submission the Parties shall discuss and agree additional studies to be undertaken by GW on a shared cost basis or at Bayer’s cost (as the case may be) required to generate the data and other information required to be included within the submissions to Treatment Endorsement Bodies. The Parties may agree that such studies may be performed by Bayer or its Affiliates at their own expense. Prior to any submission to a Treatment Endorsement Body, the applicant shall provide Regulatory Collaboration Committee with copies of its proposed submissions. The Regulatory Collaboration Committee shall review such proposed submissions and ensure that the impact of any decisions regarding the contents of the application to the Treatment Endorsement Body is not detrimental to either Party’s interests.

 

7.4.                           Subject to Clause 7.5, GW will be the sole and beneficial owner of any Marketing Authorisations for the Products. Upon receipt of the initial Marketing Authorisations for the Products GW shall be responsible for the maintenance and seeking revisions and variations of each such Marketing Authorisations for the Products at its cost and shall discuss such revision or variation with the Regulatory Collaboration Committee.

 

7.5.                           The Parties shall mutually agree to transfer a Marketing Authorisation to a Bayer Affiliate if a local presence is required by law in a country within the Territory and that GW does not have such presence in such country. In the event that a Marketing Authorisation is held by a Bayer Affiliate, the Parties shall in good faith agree upon provisions reflecting the aforesaid principle and Bayer shall procure that the Bayer Affiliate in question promptly accedes to and cooperates in any request by GW that the Marketing Authorisation be transferred to GW or its nominee or in any equivalent procedure.

 

7.6.                          Bayer acknowledges that GW has prior to the Effective Date made applications to the UK Medicines and Healthcare Products Regulatory Agency (“MHRA”) for Marketing

 


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Authorisations in the UK Territory for the Products. Prior to any submissions to any other Medicinal Products Regulatory Authority in the Territory in relation to a Marketing Authorisation, GW shall provide the Regulatory Collaboration Committee with copies of its proposed submissions including any changes or modifications to the label or labelling for, or the Indications for the Products. The Regulatory Collaboration Committee shall review such proposed submissions and ensure that the impact of any decisions regarding regulatory strategy or revisions to the Marketing Authorisations is not detrimental to either Party’s commercial and marketing strategy for the Products.

 

7.7.                           Upon receipt of questions from MHRA in UK Territory, GW will discuss within the Regulatory Collaboration Committee proposed responses and implications for SmPC wording. GW will respond to deficiency questions and undertake additional studies to secure the initial Marketing Authorisation SmPC in accordance with the decisions made by the Regulatory Collaboration Committee in a timely manner.

 

7.8.                           In respect of countries of the Territory, GW will request artwork input from Bayer or its Affiliate for the pack design, packaging, and labelling for the Products at Bayer’s cost. GW shall have sole authority and responsibility to seek and/or obtain any necessary Medicinal Products Regulatory Authority approvals of any label, labelling,  patient information leaflets, monographs and packaging used in connection with the Products, and for determining whether the same requires Medicinal Products Regulatory Authority approval. Upon request by GW, Bayer shall collaborate with GW through the provision of reasonable assistance in seeking and obtaining such approvals.

 

7.9.                           Each Party agrees to provide the other with all reasonable assistance and take all actions reasonably requested by the other that are necessary or desirable to enable the other Party to comply with any Laws in any country of the Territory applicable to the Products, including but not limited to, GW meeting its reporting and other obligations to maintain and update any Marketing Authorisations for the Products. GW shall send to Bayer or its Affiliates copies of all relevant Marketing Authorisation(s) and amendments within a reasonable timeframe of their grant or coming into effect.

 

7.10.                    In respect of the UK Territory, provisions relating to Adverse Event Reporting obligations will be agreed separately in writing within forty-five (45) days following the Effective Date by the Parties and their respective central Safety Departments. Adverse Event Reporting in the UK Territory shall be at GW’s cost. Outside the UK Territory, subject to Clause 3, Bayer shall carry out Adverse Event Reporting at costs to be agreed under the territory option procedure in Clause 3.1 and provide GW with access to all information necessary for GW to fulfil its obligations as Marketing Authorisation holder.

 

7.11.                    The Parties shall agree separately as part of the Adverse Event Reporting obligations on the responsibilities to responding to enquiries for medical information from healthcare professionals, its medical representatives, other medical organisations or societies and any Governmental Authorities in respect of matters relating to the indicated use of the Products as provided in the then current Marketing Authorisation within the UK. Outside the UK, subject to Clause 3, Bayer shall be responsible for medical information at Bayer’s cost. GW shall ensure Bayer has sufficient clinical data and supporting information to respond to all such enquiries. GW shall provide to Bayer or its Affiliates the current SmPC in order to carry out the medical information function.

 

7.12.                    Subject to a separate agreement on Adverse Event Reporting, Bayer shall provide an update to GW on a quarterly basis providing a detailed summary of medical information enquiries and standard answers that Bayer have developed in response to such enquiries.

 

7.13.                    The Parties shall only implement a market withdrawal or recall of any of the Products upon mutual agreement, provided that nothing shall oblige either Party to be in breach of any of its legal or other obligations.

 

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7.14.                    GW shall be responsible for updating compendia (MIMS, BNF, EMC for the UK Territory and any additional compendia to be agreed between the Parties) in the Territory.

 

8.                                    CONFIDENTIALITY AND ANNOUNCEMENTS

 

8.1.                           During the term of this Agreement and for seven (7) years thereafter, irrespective of any termination earlier than the expiration of the term of this Agreement and without prejudice to GW’s rights to data exclusivity rights under Article 10.1.a. (iii) of Council Directive (EC) 2001/83, GW and Bayer shall not use or reveal or disclose to Third Parties any confidential information received from the other or otherwise developed by either of Bayer or GW in the performance of activities in furtherance of this Agreement without first obtaining the written consent of the disclosing Party (and any such disclosure shall be on terms equivalent to those herein), except as may be otherwise provided herein. This confidentiality obligation shall not apply to such information which is or becomes a matter of public knowledge, or is already in the possession of the receiving Party, or is disclosed to the receiving Party by a Third Party having the right to do so, or is required by law to be disclosed. The Parties shall ensure that others to whom access to such information is granted make no unauthorised use or disclosure.

 

8.2.                           Nothing herein shall be construed as preventing Bayer or GW from disclosing any information received from the other to an Affiliate provided that the receiving Party procures that the Affiliate in question complies with confidentiality obligations equivalent to those herein.

 

8.3.                           All confidential information disclosed by one Party to the other should remain the Intellectual Property Rights of the disclosing Party. In the event that a court or other legal or administrative tribunal, directly or through an appointed master, trustee or receiver, assumes partial or complete control over the assets of a Party to this Agreement based on the insolvency or bankruptcy of such Party, the bankrupt or insolvent Party shall promptly notify the court or other tribunal (i) that confidential information received from the other Party under this Agreement remains the property of the other Party and (ii) of the confidentiality obligations under this Agreement. In addition, the bankrupt or insolvent Party shall, to the extent permitted by law, take all steps necessary or desirable to maintain the confidentiality of the other Party’s confidential information and to ensure that the court, other tribunal or appointee maintains such information in confidence in accordance with the terms of this Agreement.

 

8.4.                           No public announcement or other disclosure to Third Parties concerning the existence of or terms of this Agreement shall be made, either directly or indirectly, by either Party to this Agreement, except as may be legally required or as may be required for financial reporting or recording purposes, without first obtaining the approval of the other Party and agreement upon the nature and text of such announcement or disclosure and the other Party shall either give such approval or reasonable and substantial reasons for refusal within two business days of the date approval was first sought for the said announcement. Even in circumstances where approval of the other Party is not to be sought for legal, financial reporting or recording purposes, the Party making the announcement or disclosure shall provide the text to the other at least forty eight (48) hours in advance of publication. The Party desiring to make any such public announcement or other disclosure requiring the other Party’s approval shall inform the other Party of the proposed announcement or disclosure in reasonably sufficient time prior to public release, and shall provide the other Party with a written copy thereof, in order to allow such other Party to approve upon such announcement or disclosure. Once a Party has received consent to the text submitted by it to the other Party for public announcement or disclosure, the submitting Party may use the same or equivalent text for similar purposes without requiring further consent from the other Party providing the initial text is not materially varied, without further consent being sought from the other Party.

 

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8.5.                           Bayer shall not submit for written or oral publication any scientific manuscript, abstract or the like which includes data or other information relating to the Products without first obtaining the prior written consent of GW, which consent shall not be unreasonably withheld or delayed. Bayer shall send such publications to GW and within thirty (30) business days of the receipt of the request GW shall give the consent or provide reasonable and substantial reasons for refusal, provided, however, that such submission and consent shall not be required for spin-off publications which are materially similar to publications that were previously approved by GW. The contribution of each Party shall be duly noted in all publications or presentations by acknowledgement or co-authorship, whichever is appropriate.

 

8.6.                           Nothing in this Agreement shall be construed as preventing or in any way inhibiting GW or Bayer from complying with statutory and regulatory requirements governing the manufacture, use and sale or other distribution of the Products in any manner which it reasonably deems appropriate, including, for example, by disclosing to regulatory authorities confidential or other information received from the other Party or Third Parties.

 

8.7.                           All media and press enquiries received by GW relating to the promotion and sale of the Products in the Territory by Bayer shall be referred to Bayer who shall promptly and appropriately respond to such enquiries. Any such enquiries or responses or equivalent enquiries received by Bayer relating to the Products that could impinge on GW’s responsibilities and obligations as holder of the Marketing Authorisation or be detrimental in any way to GW shall be discussed and agreed with GW promptly prior to Bayer responding to such media enquiry.

 

9.                                    INTELLECTUAL PROPERTY RIGHTS OWNERSHIP, PATENT PROSECUTION AND LITIGATION

 

9.1.                           Each Party shall have and retain sole and exclusive title to their respective Background Rights. For the avoidance of doubt, GW shall have and retain sole and exclusive title to all Foreground Rights which are made, conceived, reduced to practice or generated in the course of or as a result of this Agreement. In the case of any Foreground Rights that may arise from the activities of Bayer during the course of this Agreement, Bayer shall promptly disclose and assign such Foreground Rights to GW and do all acts which GW shall reasonably require of Bayer to vest the property of such Foreground Rights in GW at GW’s expense. GW shall grant to Bayer a non-exclusive, royalty—free, perpetual, irrevocable licence to exploit the same in the Territory.

 

9.2.                           GW warrants and represents that it has disclosed to Bayer the complete texts of all patent applications filed by GW as of the Effective Date which relate to the Products as well as all information received by GW as of the Effective Date concerning the institution or possible institution of any opposition, re-examination, reissue, revocation, nullification or any official proceeding involving the GW IPR in the Territory. GW further warrants and represents that it will disclose to Bayer the complete texts of all patent applications filed by GW after the Effective Date which relate to the Products in the Territory, or outside the Territory if such application could affect the validity of the GW IPR in the Territory, as well as all information received by GW after the Effective Date concerning the institution or possible institution of any, opposition, re-examination, reissue, revocation, nullification or any official proceeding involving any GW IPR. GW shall be responsible at its own cost for filing, prosecution, maintenance and renewal of the GW Patents. GW agrees to keep Bayer informed of the course of patent prosecution or other proceedings. In such circumstances, Bayer may provide patent consultation to GW at no cost to GW. Bayer shall hold all information disclosed to it under this Clause as confidential subject to the provisions of Clauses 8.2 and 8.3 above.

 

9.3.                           Bayer shall have the right, but not the obligation, to assume responsibility at its cost for any GW Patent or any part of a GW Patent in the Territory, which GW states to Bayer in writing that it intends to abandon or otherwise cause or allow to be forfeited. GW shall give Bayer

 

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reasonable written notice prior to abandonment or other forfeiture of any such GW Patent or any part of such GW Patent so as to permit Bayer to exercise its rights under this Clause 9.3 in respect of the Products.

 

9.4.                           In the event of the institution of any suit by a Third Party against GW or its Affiliates or Bayer or its Affiliates for patent or other Intellectual Property Rights infringement involving the manufacture, use, sale, distribution or marketing of the Products in accordance with this Agreement the Party sued shall promptly notify the other Party in writing and Bayer shall make no admission. GW shall take all appropriate action to defend such suit at its own expense. GW shall have sole conduct of such defence. GW and Bayer shall provide reasonable assistance to one another and reasonably co-operate in any such litigation at the other’s request without expense to the requesting Party. Any costs agreed to in advance in writing by GW and reasonably incurred by Bayer in defending such litigation shall be invoiced by Bayer to GW and shall become payable within thirty (30) days from receipt of invoice. In circumstances where the alleged infringement is upheld through the legal proceedings and/or the Third Party is unable or unwilling to grant a licence of its Intellectual Property Rights to prevent future infringement despite the Parties using their respective best efforts to obtain the same, the parties shall meet and discuss in good faith how to proceed.

 

9.5.                           In the event that GW or Bayer becomes aware of actual or threatened infringement or validity attacks of GW IPR in the Territory, that Party shall promptly notify the other Party in writing. Bayer shall have the first right, but not the obligation, to bring, at its own expense, an infringement action against any Third Party in the Territory and to use GW’s name in connection therewith and to name GW as a party thereto. If Bayer does not commence a particular infringement action within thirty (30) days of receipt of the notice of infringement, then GW, after notifying Bayer in writing, shall be entitled to bring such infringement action at its own expense. The Party conducting such action shall have full control over its conduct, including settlement thereof subject to Clause 9.8 below provided always that that Party shall not bear any part of the settlement payments unless that Party has been involved in and agreed to the settlement.

 

9.6.                           Subject to the other provisions of this Clause 9, in any action brought pursuant to Clause 9.5 above, the Party bringing the action shall indemnify the other Party, its officers, directors, shareholders, employees, agents, successors and assigns from any loss, damage or liability, including for attorney’s fees and costs, which may result from claims, counterclaims or cross claims asserted by a defendant, except to the extent that such losses, damages or liabilities result from the negligence or wilful misconduct or breach of this Agreement of the other Party.

 

9.7.                           GW and Bayer shall recover their respective actual out-of-pocket expenses, or equitable proportions thereof, associated with any litigation or settlement thereof from any recovery made by either Party. Any excess amount shall be shared equally between Bayer and GW.

 

9.8.                           The Parties shall keep one another informed of the status of and of their respective activities regarding any litigation or settlement thereof concerning the Products, provided however that no settlement or consent judgement or other voluntary final disposition of any suit defended or action brought by a Party pursuant to this Clause 9 may be entered into without the consent of the other Party or to make a monetary payment or would otherwise adversely affect the other Party’s rights under this Agreement.

 

9.9.                          Notwithstanding the generality of Clause 16.2, if, during the term of this Agreement, Bayer and GW agree in writing whether it is necessary to seek a license from any Third Party in order to avoid infringement of Third Party IPR in any part of the Territory during the exercise of the license or distribution right granted herein, GW shall seek such a license in

 

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full co-operation with Bayer. GW shall be responsible for the payment of any royalties or other fees paid to such Third Party directly but *** percent (***%) of any royalties or other fees paid to such Third Party by GW under such license shall be the liability of Bayer and shall be payable by Bayer within thirty (30) days of receipt of an invoice from GW.

 

10.                               TRADE MARKS AND PRODUCT MARKING

 

10.1.                    GW hereby grants to Bayer a sole license to use the Trade Marks in the Territory to the extent necessary for Bayer to fulfil its obligations under this Agreement.

 

10.2.                    Bayer hereby grants to GW the right to use the Bayer logo on the artwork and labelling for the Products during the manufacture in a manner, style and colour as specified by Bayer. GW shall have no rights in the Bayer logo and agrees that upon termination or expiration of this Agreement or for the period of a cessation of supply under the provisions of Clause 8.2.5 of the Supply Agreement it will discontinue within thirty (30) days of use of the Bayer logo and will at the request of Bayer and at its own expense submit applications to the relevant Governmental Authority to remove the Bayer logo from the relevant Marketing Authorisation and related patient information leaflet and SmPC.

 

10.3.                    GW shall be responsible at its own cost for the registration, renewal and maintenance including, but without limitation, in relation to oppositions of all registrations and applications for the Trade Marks in the Territory. GW shall, take all necessary steps to protect the Trade Marks by way of further registrations having regard to the commercial importance of the Trade Marks to both parties and to the use made or to be made of the Trade Marks. The provisions of Clause 9.5 above shall apply in relation to the enforcement and defence of the Trade Marks mutatis mutandis.

 

10.4.                    Nothing in this Agreement shall be construed as a grant of rights, by license or otherwise, to either Party to use any other trade marks owned by the other Party for any purpose.

 

10.5.                    Bayer shall not by virtue of this Agreement obtain or claim any right, title or interest in or to the Trade Marks except the rights of use which are specifically set out in this Agreement. Bayer hereby acknowledges and agrees that the benefit of all such use shall belong to GW. GW hereby reserves all rights and powers not expressly granted to Bayer hereunder. All goodwill arising in relation to the use of the Trade Marks shall accrue to GW. Upon request, Bayer shall execute all documents requested by GW in order to confirm this.

 

10.6.                    All products on or in relation to which Bayer uses the Trade Marks, shall be of the highest professional quality and in any event of a quality at least equal to those on or in relation to which Bayer used any trade mark in the twelve (12) months prior to the Effective Date and subject to any guidelines issued by GW to Bayer from time to time. This Clause shall not limit the provisions of Clauses 10.9 to 10.12 below.

 

10.7.                    Bayer shall ensure that its use of the Trade Marks conforms to and complies with:

 

(a)                                 the standards, regulations and other provisions specified in this Agreement;

 

(b)                                 all good practice requirements relating to or affecting the same and all applicable Laws; and

 

(c)                                  all other requirements which have been agreed upon by the Parties in writing from time to time.

 

10.8.                    At GW’s request from time to time Bayer shall provide GW with samples of its use of the Trade Marks.

 

10.9.                    Bayer shall not:

 


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(a)                                 use the Trade Marks in a manner which is likely to cause harm to the goodwill attached to it;

 

(b)                                 use the Trade Marks in any manner which would bring the Trade Marks or GW into disrepute;

 

(c)                                  use the Trade Marks in any manner which would jeopardise or invalidate any registration (or prejudice any application for registration) of the Trade Marks or could assist or give rise to an application to terminate or revoke any registration; and/or

 

(e)                                  use the Trade Marks in any manner which might prejudice the right or title of GW to the Trade Marks.

 

10.10.             Except as expressly permitted or required in this Agreement, Bayer shall not use the Trade Marks accompanied by other words or other trade marks, whether registered or not, nor by words describing products and services within the scope of the licence granted in Clause 10.1 above, unless in each case the Trade Marks are sufficiently distinguished from the surrounding text.

 

10.11.             Bayer shall clearly identify GW as the owner or (if applicable) the registered proprietor of the Trade Marks where used by Bayer.

 

10.12.             Bayer shall not adopt or use any trade mark, symbol, device, service mark, domain name or company, business or trading name which incorporates or is confusingly similar to the Trade Marks except as expressly permitted or required in this Agreement. Bayer shall not at any time, whether during or after the termination of this Agreement, apply anywhere in the world to register any trade marks, service marks, domain names or company, business or trading names identical to or so nearly resembling the Trade Marks as to be likely to deceive or cause confusion.

 

10.13.             Bayer shall submit any proposed representation of the Trade Marks to GW for GW’s approval, such approval not to be unreasonably withheld or delayed.

 

10.14.             All Promotional Materials, Products and packaging shall properly and clearly indicate that the Products are sold under license from GW.

 

10.15.             GW shall own any registered domain name containing either of the Trade Marks or any other trade mark or service mark referred to above. Bayer shall be entitled to operate the web sites under such domain names in the Territory for the duration of this Agreement soley for the purpose of performing its obligations and enjoying its rights hereunder.

 

11.                              STATEMENTS AND REMITTANCES

 

11.1.                    Bayer shall keep and shall require its Affiliates to keep complete and accurate records of all sales of the Products in each country of the Territory. GW shall have the right, at GW’s expense, through a certified public accountant or like person reasonably acceptable to Bayer, to examine such records during regular business hours during the term of this Agreement and for six (6) months after its termination; provided, however, that such examination shall not take place more often than once a year and shall not cover such records for more than the preceding two (2) years and provided further that such accountant shall report to GW only as to the accuracy of the Net Sales statements and payments. GW shall pay all costs and expenses incurred in connection with performing any such examination unless the examination discloses at least *** percent (***%) shortfall, in which case Bayer will bear the full cost of such examination.

 

11.2.                    Any tax, duty or other levy paid or required to be withheld by Bayer on account of payments

 


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payable to GW under this Agreement shall be deducted from the payments otherwise due. Bayer shall secure and send to GW proof of any such taxes, duties or other levies withheld and paid by Bayer or its Affiliates for the benefit of GW.

 

12.                              TERM AND TERMINATION

 

12.1.                    This Agreement shall continue for fifteen (15) years (“Initial Term”), provided that the Agreement shall continue for successive twelve (12) month periods thereafter unless Bayer terminates by serving at least twelve (12) months’ written notice prior to the end of the Initial Term and prior to the end of each successive calendar year after such Initial Term.

 

12.2.                    If either Party fails or neglects to perform material covenants or provisions of this Agreement, including as provided for by Clause 2.4 above and Clause 8.2.5 of the Supply Agreement, the other Party shall have the right to terminate this Agreement by giving written notice to the Party in default within sixty (60) days of the default, provided, however, that in the case of a default or breach capable of being cured, if the said defaulting Party shall cure the said default or breach within ninety (90) days after the said notice shall have been given, then the said notice shall not be effective.

 

12.3.                    Without prejudice to the generality of Clause 12.2 above and GW’s other rights hereunder GW shall be entitled to terminate this Agreement in its entirety or with respect to an individual Product or country of the Territory with immediate effect in the event that:

 

(a)                                 Bayer fails to achieve Launch within the timescale required by Clause 6.1 above;

 

(b)                                 Subject to the provisions of Clause 6 above, Bayer ceases or suspends commercialisation of any of the Products throughout the Territory or in one or more countries of the Territory and has notified GW in writing of its intention in this respect, other than for technical or regulatory reasons as provided in Clause 12.4 below;

 

(c)                                  Under the circumstances set out in Clause 6.6 above and Clause 22.1 below.

 

12.4.                    Without prejudice to the generality of Clause 12.2 above and Bayer’s other rights hereunder Bayer shall be entitled to terminate this Agreement in its entirety or with respect to an individual Product or country of the Territory with immediate effect in the event that:

 

(a)                                  the Medicinal Products Regulatory Authority does not grant to GW a Marketing Authorisation for a Product, provided that Bayer shall not be entitled to exercise such termination right before 30 September 2004;

 

(b)                                 GW fails to comply with its obligation under Clause 18.1 of the Supply Agreement;

 

(c)                                   Bayer is forced by Governmental Authority to stop the distribution of Product due to toxicity or safety findings or side effects of Product;

 

(d)                                  if either Bayer or GW fails to secure a licence from a Third Party to continue marketing any of the Products throughout the Territory or in one or more countries of the Territory as provided under Clause 9.4 above.

 

12.5.                    In the event of a withdrawal or suspension of a Marketing Authorisation or restrictions imposed by any Governmental Authority in respect of a Product throughout the Territory or in one or more countries of the Territory GW and Bayer shall meet to discuss and review the terms of this Agreement. In the event of a failure by the Parties to agree revised terms or to resolve the issue to permit a variation or reinstatement of any Marketing Authorisation(s) despite mutual good faith efforts to do so either GW or Bayer shall have the right to terminate this Agreement in relation to the Product in question in all or any of the country(ies) of the Territory governed by the Marketing Authorisation by giving ninety (90) days written notice to the other.

 

12.6.                    If either Party shall compound or make any arrangement with its creditors or have a receiver appointed over all or any part of its assets or go into liquidation (whether voluntary

 

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or otherwise) save as part of a bona fide reconstruction not involving insolvency or shall take or suffer to be taken any similar action as a result of its liability to pay its debts or its insolvency it shall promptly so notify the other Party in writing giving particulars of the circumstances whereupon the other Party may terminate the Agreement immediately.

 

12.7.                    Notwithstanding the bankruptcy of GW, or the impairment of performance by GW of its obligations under this Agreement as a result of bankruptcy or insolvency of GW, Bayer shall (provided that all payments due to GW from Bayer and its Affiliates hereunder have been made) be entitled to retain the licenses granted herein, subject to GW’s rights to terminate this Agreement for reasons other than bankruptcy or insolvency as expressly provided in this Agreement.

 

12.8.                     The Supply Agreement shall automatically terminate at the same time in its entirety in the event that this Agreement shall terminate in its entirety under the terms of this Clause 12. In the event that termination takes place under this Agreement in relation to any Product or any or all of the affected countries of the Territory then the parties shall meet and negotiate in good faith agreed changes to the Supply Agreement consequential on a partial termination of this Agreement under this Clause 12.

 

13.                              RIGHTS AND DUTIES UPON TERMINATION

 

13.1.                    Upon termination of this Agreement, unless in the event Bayer was entitled to terminate the Agreement based on fraud or wilful default by GW, GW shall have the right to retain all milestone payments scheduled in Appendix 3 to this Agreement already paid by Bayer or due to GW at that time. Bayer shall have no liability to GW in respect of further milestone payments detailed in the said Appendix 3 to this Agreement.

 

13.2.                    Upon termination of this Agreement, all licenses granted hereunder to Bayer shall cease and Bayer undertakes not to use any GW IPR, except as may be otherwise provided in this Agreement and the Supply Agreement. Furthermore, promptly after the effective date of such termination, Bayer shall return all tangible GW Know-how including copies thereof to GW to the extent that such is practicable.

 

13.3.                    Upon termination of this Agreement in its entirety or with respect to any Products or countries of the Territory under Clause 12.3 above, Bayer shall notify GW of the amount of the Products Bayer and its Affiliates have on hand and Bayer and its Affiliates, shall thereupon be permitted to sell those amounts of the Products for a period of up to one hundred and eighty (180) days after termination provided that Bayer shall pay the payments thereon at the time herein provided for. GW at its option may repurchase the products Bayer and its Affiliates have on hand by reimbursing to Bayer the Supply Price. The Parties agree to negotiate in good faith all regulatory steps required upon such termination and undertake to initiate such steps subsequently.

 

13.4.                    Termination of this Agreement in its entirety shall terminate all outstanding obligations and liabilities between the Parties arising from this Agreement except those described in Clauses 4, 7.9, 8, 9, 10, 11, and 17 hereof, and any other obligations otherwise provided by this Agreement which have accrued or have application beyond the term of this Agreement. In addition, any other provision required to interpret and enforce the Parties’ rights and obligations under this Agreement shall also survive, but only to the extent required for the full observation and performance of this Agreement.

 

13.5.                   Termination of the Agreement in accordance with the provisions hereof shall not limit remedies, which may be otherwise available in law or equity.

 

13.6.                    Except as required under Clause 13.3 above, Bayer shall immediately cease use of the Trade Marks upon termination of this Agreement in its entirety or in relation to any one or more Products or countries of the Territory, entirely or in relation to that Product or country of the Territory, as the case may be.

 

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14.          WARRANTIES AND REPRESENTATIONS

 

14.1.       GW warrants and represents that it has the right to enter into this Agreement and to the best of its knowledge and belief that with respect to the Products it owns or controls the entire right, title and interest in the GW IPR and the Trade Marks.

 

14.2.       GW warrants and represents that any GW IPR and any Trade Marks is not encumbered with liens, mortgages, security interests or otherwise. GW further warrants and represents that to the best of its knowledge and belief there is nothing in any Third Party agreement GW has entered into as of the Effective Date which, in any way, will limit GW’s ability to perform all of the obligations undertaken by GW hereunder with respect to the Products, and that it will not enter into any agreement after the Effective Date under which GW would incur any such limitations.

 

14.3.       GW warrants and represents that in relation to the Products it has no present knowledge as at the Effective Date from which it can be inferred that GW IPR as currently comprised are invalid or that their exercise would infringe Intellectual Property Rights of Third Parties.

 

14.4.       Subject to the provisions of the SmPC which is approved by a Medicinal Products Regulatory Authority, GW warrants and represents that to the best of its knowledge and belief there are no pre-clinical or clinical data or information concerning the Products which suggests that there may exist quality, toxicity, safety and/or efficacy concerns which may materially impair the utility and/or safety of the Products.

 

14.5.       Each Party warrants and represents to the other Party that (i) such Party is duly organised and validly existing under the Laws of the Territory and has full corporate power and authority to enter into this Agreement and carry out the provisions hereof, and (ii) such Party is duly authorised to execute and deliver this Agreement and to perform is obligations hereunder.

 

15.          INDEMNITIES AND LIMITATION; INSURANCE

 

15.1.       Bayer shall indemnify, keep indemnified and hold GW harmless against (a) any and all liabilities, losses, costs and expenses (including reasonable legal fees) relating to Products which result from any and all claims, suits, actions, demands or judgments of third parties, including without limitation personal injury and product liability matters brought against GW, other than to the extent resulting directly from any negligence or material breach of this Agreement or the Supply Agreement by GW, its employees and sub-contractors, or (b) any material misrepresentation, breach of warranty or non-fulfilment of or failure to perform any obligation of Bayer in this Agreement or the Supply Agreement.

 

15.2.       GW shall indemnify, keep indemnified and hold Bayer harmless against any and all liabilities, losses, costs and expenses (including reasonable legal fees) to the extent the same directly result from (a) any and all claims, suits, actions, demands or judgments of third parties, including without limitation personal injury and product liability matters brought against Bayer arising as a result of personal injury or death in respect of any Product not sold or distributed by Bayer, its Affiliates, designated Third Parties, and their respective employees and sub-contractors, including, but not limited to, Products distributed by GW in the course of clinical trials prior to the Effective Date and during the term of this Agreement, (b) any and all Third Party product liability claims made or suits brought against Bayer arising as a result of personal injury or death in respect of any negligence or material breach of this Agreement or the Supply Agreement by GW, its employees and sub-contractors, (c) any material misrepresentation, breach of warranty or non-fulfilment of or failure to perform any obligation of GW in this Agreement or the Supply Agreement, or (d) any negligent act or omission of GW.

 

15.3.       In the event GW or Bayer (the “Indemnified Party”) wants to bring a claim against the other (the “Indemnifying Party”) under the indemnities in this Clause 15, the Indemnified Party shall give prompt written notice to the Indemnifying Party of any claim or threat of claim it

 

21



 

receives with respect of any matter for which it may be entitled to indemnification, the Indemnifying Party shall thereafter defend or settle any such claim at its sole expense, and with counsel selected by the Indemnifying Party and reasonably acceptable to the Indemnified Party. In the defence or settlement of any such claim the Indemnified Party shall co-operate with and assist the Indemnifying Party to the extent reasonably possible, but the Indemnifying Party shall bear and pay any and all expenses incurred by that Indemnified Party in providing such co-operation and assistance, either directly or upon request of the Indemnified Party who has incurred such expense. Failure to give notice shall not constitute a defence in whole or in part to any claim by the Indemnified Party except to the extent the rights of the Indemnifying Party are materially prejudiced by such failure to give notice.

 

15.4.       Notwithstanding the foregoing, should any claim be made by a person not a Party to this Agreement (and not an Affiliate of a Party) with respect to any matter to which the foregoing indemnity relates, a Indemnified Party may make settlement of such claim giving not less than twenty (20) days prior written notice of the proposed terms thereof to the Indemnifying Party provided, however, that if within said twenty (20) day period the Indemnifying Party shall have requested the Indemnified Party not to settle such claim and to deny such claim, the Indemnified Party will promptly comply and the Indemnifying Party shall have the right to defend the claim at its sole expense and with counsel reasonably acceptable to the Indemnified Party.

 

15.5.       Notwithstanding that the Indemnifying Party has assumed the defence of any claim with counsel selected by the Indemnifying Party and reasonably acceptable to the Indemnified Party, the Indemnified Party shall have the right to employ its own counsel, at its sole expense. If in good faith, the Indemnified Party concludes that there are specific defences available to the Indemnified Party which are different from or in addition to those available to the Indemnifying Party, or that such claims may have a material adverse effect on the Indemnified Party, with respect to the scope of the foregoing indemnity, then the Indemnified Party shall have the right to direct the defence of any such claim in consultation with the Indemnifying Party and the Indemnifying Party shall bear the expense of doing so.

 

15.6.       Except as provided for herein, no Indemnified Party will compromise or settle any claims (whether by admission, statements, payments or allowances) nor will it conduct itself in a way that could prejudice the defence of any such claims or threats except where the Indemnifying Party has given its prior written consent therefore.

 

15.7.       The liability of GW under Clause 15.2 shall not exceed the total sum of five (5) million Euro.

 

15.8.       Each party shall maintain at its own cost appropriate third party, public liability and product liability insurance or self insurance to cover its reasonably anticipated liabilities hereunder and grant the other party the right to inspect the insurance certificate.

 

16.          FORCE MAJEURE; HARDSHIP

 

16.1.      If the performance of any part of this Agreement by either Party, or of any obligation under this Agreement, is prevented, restricted, interfered with or delayed by reason of any cause beyond the reasonable control of the Party liable to perform, such as, without limitation: fire, explosion, flood, war, acts of God, acts of terrorism, riot, sabotage, accident, disease, embargo, interruption or delay in production or transportation if such interruption or delay could not be anticipated unforeseeable inadequacy or shortage or failure of supply of raw materials or equipment, unforeseeable breakdown of plant, strike, labour trouble, orders, actions and directives by any authority, unless conclusive evidence to the contrary is provided, the Party so affected shall, upon giving written notice to the other Party, be excused from such performance to the extent of such prevention, restriction, interference or delay, provided that the affected Party shall use its reasonable efforts to avoid or remove such causes of non-performance and shall continue performance with the utmost dispatch

 

22



 

whenever such causes are removed. When such circumstances arise, the Parties shall discuss what, if any, modification of the terms of this Agreement may be required in order to arrive at an equitable solution.

 

16.2.       If as a result of unforeseen events or developments the effect of this Agreement shall cause inequitable hardship for one or both Parties and/or, in the case of Bayer, its Affiliates, which runs counter to the aim of this Agreement and which the one Party cannot reasonably and in good faith expect the other Party to tolerate, the Parties will meet and seek in good faith to find equitable ways to amend the Agreement in order to re-establish the basic economic balance of this Agreement.

 

17.          GOVERNING LAW AND DISPUTE RESOLUTION

 

17.1.       Subject to Clause 17.4, if any disputes, controversies or differences (“dispute(s)”) arising hereunder they will first be referred for resolution, prior to either Party initiating any proceeding, to the Contract Governance Committee who will attempt in good faith to resolve the dispute within ninety (90) days from the date that written notice initiating this dispute resolution process is sent to the other Party (the “Initial Notice”). If, however, the dispute between the Parties has not been resolved within the aforesaid period of ninety (90) from the date of the Initial Notice (the “Initial Period”), the matter will then subject to Clause 17.3 below be finally settled by mediation in accordance with the Centre for Dispute Resolution Model Procedure (“CEDR”) in accordance with Clause 17.2 below.

 

17.2.       To initiate the mediation a Party must give notice in writing (the “ADR Notice”) to the other Party requesting a mediation. The mediation will take place not later than twenty-eight (28) days after the service of an ADR Notice on the other Party. If there is any issue on the conduct of the mediation upon which the Parties cannot agree within fourteen (14) days of the ADR Notice, CEDR will, at the request of either Party, decide the issues for the Parties, having consulted with them.

 

17.3.       In the event that one of the Parties does not wish to settle any dispute which may arise in accordance with CEDR but instead wishes to commence proceedings in the English Courts, then the Parties irrevocably agree that the Courts of England will have exclusive jurisdiction to settle any outstanding dispute.

 

17.4.       Notwithstanding the dispute settlement procedure described under Clause 17.1, either Party shall be entitled to seek a preliminary injunction in order to protect its rights.

 

17.5.       This Agreement shall be governed by and construed in accordance with English law.

 

18.          WAIVER OF BREACH

 

No waiver or forbearance by either Party in enforcing any of its rights under this Agreement shall prejudice or affect the ability of such Party to enforce such rights or any of its other rights at any time in the future. No waiver shall be effective unless in writing and signed by the other Parties. For the avoidance of doubt, it is agreed that a waiver of a right on one occasion shall not constitute a waiver of the same right in the future.

 

19.          SEVERABILITY

 

19.1.       In the event any portion of this Agreement shall be held illegal, void or ineffective, the remaining portions hereof shall remain in full force and effect.

 

19.2.       If any of the terms or provisions of this Agreement are in conflict with any applicable statute or rule of law, then such terms or provisions shall be deemed inoperative to the extent that they may conflict therewith and shall be deemed to be modified to conform with such statute or rule of law.

 

19.3.       In the event that the terms and conditions of this Agreement are materially altered as a result of Clauses 19.1 or 19.2 above, the Parties will renegotiate the terms and conditions of this Agreement in good faith to resolve any consequent inequities.

 

23



 

20.          ENTIRE AGREEMENT

 

20.1.       This Agreement, the Supply Agreement, the Quality Agreement, the Subscription Option Agreement and the Loan Agreement and any side letters entered into amending this Agreement or under the Territory Option Procedure constitute the entire agreement between the parties relating to the subject matter hereof and supersedes all previous agreements, negotiations and understandings. No terms or provisions of this Agreement shall be varied or modified by any prior or subsequent statement, conduct or act of either of the parties, except that the parties may amend this Agreement by written instruments specifically referring to and executed in the same manner as this Agreement.

 

20.2.       In the event of any conflict between any of the provisions/terms of this Agreement, the Supply Agreement and the Quality Agreement, the terms of this Agreement shall take precedence over and to the exclusion of the terms of such other agreement that is in conflict with such terms.

 

21.          NOTICES

 

21.1        Any communication to be given in connection with the matters contemplated by this Agreement shall except where expressly provided otherwise be in writing and shall either be sent by first class pre-paid post, delivered by hand or sent by fax. Delivery by courier shall be regarded as delivery by hand. Such communication shall be sent to the following addresses of the parties:

 

If to GW:

 

The Company Secretary

 

 

GW Pharma Limited

 

 

Porton Down Science Park,

 

 

Salisbury,

 

 

Wiltshire SP4 0JQ

 

 

Fax No.: + 44 - 1980 557 111

 

 

 

If to Bayer:

 

Bayer AG

 

 

Division Pharma

 

 

International Cooperations and Licensing

 

 

51368 Leverkusen

 

 

Germany

 

 

Fax No.: + 49 – 214 – 30 - 64840

 

 

 

copy to:

 

 

 

 

 

 

 

Bayer AG

 

 

Bayer HealthCare

 

 

General Counsel

 

 

51368 Leverkusen

 

 

Germany

 

 

Fax No.: + 49 – 214 – 30 – 82986

 

21.2.       Any communication shall be deemed to have been served:

 

(a)           if sent by first class pre-paid post to the addresses referred to above, at the expiration of two clear business days after the time of posting;

 

(b)           if sent by fax to the above number, at the time of completion of transmission by the sender;

 

(c)           if delivered by hand at the above addresses at the time of delivery.

 

22.          ACQUISITION OR MERGER OF BAYER PHARMACEUTICAL BUSINESS AND ASSIGNMENT

 

22.1.       This Agreement and the licenses herein granted shall be binding upon and inure to the benefit of the successors in interest of the respective Parties. In the event that there is a

 

24



 

material change of ownership or control in the pharmaceutical business of Bayer or any of its Affiliates (“Acquisition”) then the following provisions shall apply:

 

(a)           GW shall be entitled to request from the entity acquiring such ownership or control (“New Owner”) within thirty (30) days of the Acquisition a confirmation in writing that it is willing to assume in full the obligations and rights of Bayer with respect to this Agreement and the Supply Agreement. In the event that GW does not receive that confirmation within thirty (30) days from the date of such request this Agreement shall terminate upon written notice by GW.

 

(b)           In the event that the New Owner does not achieve in any one of the next *** month periods after the Acquisition by the New Owner total sales levels throughout the Territory in relation to the Products of at least *** percent (***%) of those sales achieved by Bayer in the *** month period immediately prior to such Acquisition, each and every of the licences and rights granted under this Agreement shall become non-exclusive immediately upon written notice by GW to Bayer to this effect. In the event that a level of *** percent (***%) of those sales achieved by Bayer *** month period immediately prior to the Acquisition is not achieved by the New Owner in any one of the *** month periods after the Acquisition, this Agreement shall terminate upon written notice by GW to Bayer to this effect.

 

22.2.       Neither this Agreement nor any interest hereunder shall be assignable by any Party without the written consent of the other provided, however, that either Party without obtaining the consent of the other Party may assign this Agreement or any part of its rights and obligations hereunder, or any patent owned by it, to any of its Affiliates or to any corporation with which such party may merge or consolidate, or to which it may transfer all or substantially all of its assets to which this Agreement relates, provided that such assignment be automatically reversed once the entity concerned ceases to be an Affiliate..

 

23.          THIRD PARTY RIGHTS

 

No person who is not a Party to this Agreement shall have any rights under the Contracts (Rights of Third Parties) Act 1999 to enforce any term of this Agreement provided that for the avoidance of doubt Clause 3 above shall prevail over this Clause 23.

 

24.           COUNTERPARTS

 

24.1        This Agreement shall be executed in two counterparts, but shall not be effective until each party has executed at least one counterpart.

 

24.2        Each counterpart shall constitute an original of this Agreement, but all counterparts shall together constitute but one and the same instrument.

 


***         Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

25



 

IN WITNESS WHEREOF, the Parties, through their authorised officers, have executed this Agreement as of the date first written above.

 

 

Signed for and on behalf of

 

Signed for and on behalf of

BAYER AG

 

GW PHARMA LIMITED

 

 

 

Leverkusen, 20 May 2003

 

Salisbury, 20 May 2003

 

 

 

 

 

 

/s/ Dr. Dietrich Brocks

 

/s/ Justin Gover

Dr. Dietrich Brocks

 

Justin Gover

Head of International Cooperations and Licensing Europe

 

Managing Director

 

 

 

 

 

 

/s/ Dr. Dirk Ehle

 

/s/ David Kirk

Dr. Dirk Ehle

 

David Kirk

Law and Patents

 

Finance Director

 

26



 

APPENDIX 1

 

PRODUCTS

 

1.             Sativex ® - Finished Products containing glass vials fitted with an actuator with a pump delivering 100 microlitre per spray containing 5.5 ml and/or 10 ml tetranabinex and nabidiolex extracts of Cannabis sativa L. equivalent to 2.7 mg delta-9-tetrahydrocannabinol (THC) and 2.5 mg cannabidiol (CBD), per 100 microlitre actuation. The number of glass vials per carton as well as the to be marketed sizes of vials shall be agreed by the Country Commercialisation Committee.

 

The Product is intended for the Indications:

 

·              for symptomatic relief in patients with multiple sclerosis;

 

·              for relief of neuropathic pain;

 

·              subject to a joint decision by the Parties, for relief of cancer pain.

 

Any additional Indication which might be approved by the corresponding Medicinal Product Regulatory Authority in a country of the Territory.

 

2.            Glass vials fitted with an actuator with a pump delivering 100 microlitre per spray containing 5.5 ml and/or 10 ml Tetranabinex extract of Cannabis sativa L. equivalent to 2.7 mg delta-9-tetrahydrocannabinol (THC) per 100 microlitre actuation. To be defined further according to the draft SmPC prior to submission to the Medicinal Product Regulatory Authority.

 

27



 

APPENDIX 2

 

TERRITORY

 

Great Britain, Northern Ireland, the Channel Islands and the Isle of Man (“UK Territory”).

 

28



 

APPENDIX 3

 

LAUNCH CONDITIONS, UPFRONTS, MILESTONE EVENTS and PAYMENTS

 

PART A

 

The following payments are payable under the provisions of Clause 4 in relation to the following countries of the Territory:

 

A1.         UK Territory

 

1.   Upon entry by GW and Bayer into this Agreement payable on signature        
£5 million

 

2.   Upon the grant of a Marketing Authorisation by the UK MHRA (or successor body) for Product such sum as is equal to the sum of

 

£10 million

 

less any subscription monies paid by Bayer to GWP pursuant to Clause 3.2 of the Subscription Option Agreement as provided for by Clause 4.2 (ii)

 

3.   Upon the grant of a Marketing Authorisation by the UK MHRA (or successor body) for Product for the indication of relief of one or more primary symptoms in patients with ***.
£***

 

4.   Upon the grant of a Marketing Authorisation by the UK MHRA (or successor body) for Product in the indication of relief of ***. 
£***

 

5.   Upon the grant of a Marketing Authorisation by the UK MHRA (or successor body) for Product extract in the indication of the relief of ***.  
£***

 

TOTAL FOR UK TERRITORY                                                                              £25 million

 

A2.                for each additional country within the Territory

 

1.   Upon the fulfillment of the Launch Conditions for Product for the indication of relief of one or more primary symptoms in patients with MS.         
£     million ***

 

2.   Upon the fulfillment of the Launch Conditions for Product in the indication of relief of neuropathic pain.
£     million ***

 

3.   Upon the fulfillment of the Launch Conditions for Product in the indication of the relief of cancer pain.
£     million ***

 

TOTAL FOR each additional country within the Territory                           £     million

 


***         Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

29



 

PART B

 

The Parties shall agree within the Territory Option Period to Launch Conditions specific or non-specific to the countries within the EEA, Canada and Australia/ New Zealand. Such Launch Conditions shall be attached to Part B of Appendix 3.

 

30



 

APPENDIX 4

 

GW IPR

 

INDEX - PATENTS AND PATENT APPLICATIONS

 

Section

 

Document
Number

 

Document Description / Patent Number

***

 

***

 

***

***

 

 

 

***

***

 

***

 

***

***

 

***

 

***

***

 

***

 

***

***

 

***

 

***

***

 

***

 

***

***

 

***

 

***

***

 

***

 

***

***

 

***

 

***

***

 

***

 

***

***

 

***

 

***

***

 

***

 

***

***

 

***

 

***

***

 

***

 

***

***

 

***

 

***

***

 

***

 

***

***

 

***

 

***

***

 

***

 

***

***

 

***

 

***

***

 

***

 

***

***

 

***

 

***

***

 

***

 

***

 


***         Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

31



 

APPENDIX 5

 

TRADE MARK

 

Sativex®

 

UK: No: 2304388. Registered Date: 29/11/02

 

Europe: Not issued yet.

 

No: 002993384 Filing Date: 02/01/2003 Priority date: 04/07/2002).

 

15 countries which are: UK, Ireland, Finland, Sweden, Denmark, The Netherlands, Belgium, Germany, Luxembourg, Austria, France, Portugal, Spain, Italy and Greece.

 

International: Not Issued yet.

 

No: GB: 2304388 Filing date: 3/1/03 Priority Date: 4/7/02

 

20 countries which are: Japan, Australia, China, South Korea, Singapore, Switzerland, Norway, Bulgaria, Czech Republic, Estonia, Hungary, Liechtenstein, Lithuania, Latvia, Poland, Romania, Slovenia, Slovakia, Turkey and Yugoslavia.

 

Canada: Not issued yet.

 

No: 1163979 Date: Filing date: 06/01/03 Priority Date: 04/07/02)

 

32




Exhibit 10.2

 

***Text Omitted and Filed Separately with the Securities and Exchange Commission.

Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406

AMENDMENT NUMBER 1

 

TO THE LICENSE AND DISTRIBUTION AGREEMENT

 

between GW PHARMA LIMITED (“GW”) having its registered office at Porton Down Science Park, Salisbury, Wiltshire SP4 0JQ and BAYER HEALTHCARE AG, Division Pharma, having its registered office at Bayerwerk, 51368 Leverkusen, Germany (“Bayer”)

 

WHEREAS, Bayer AG and GW executed a License and Distribution Agreement as of the 20th day of May 2003;

 

WHEREAS, Bayer AG transferred its entire healthcare business including all contractual rights and obligations to its 100% subsidiary Bayer HealthCare AG with effect of October 1, 2003, as permitted in accordance with Clause 22.2 of the License and Distribution Agreement;

 

WHEREAS, Bayer and GW wish to extend the period of the Territory Option Procedure for the EEA, Canada, Australia and New Zealand until December 31, 2003;

 

WHEREAS, Bayer decided to exercise its option under Clause 3.1 of the License and Distribution Agreement for Canada.

 

NOW, THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:

 

1.             Clause 3.1, second and third sentence, shall be rephrased as follows:

 

At any time between the Effective Date and 31 December 2003 Bayer may opt to add to the Territory certain further countries (from other countries in the EEA, Canada, Australia and New Zealand) and on the agreed respective Launch Conditions to be set out in Part B of Appendix 3 to this Agreement and otherwise subject to the terms of this Agreement, including without limitation Clause 3.2 below.  Failure to agree any respective Launch Conditions by 31 December 2003 will result in GW being free to enter into a binding agreement with one or more Third Parties with respect to such countries unless the Parties shall have mutually agreed in writing to an extension to finalise such terms.

 

2.             Bayer hereby exercises its option under Clause 3.1 of the License and Distribution Agreement and adds Canada to the Territory as of the date of this Amendment.

 

3.             Appendix 3, Part A and B, for Canada is completed in the form attached to this Amendment.

 

4.             This Amendment shall be executed in two counterparts, but shall not be effective until each party has executed at least one counterpart.  Each counterpart shall constitute an original of this Amendment, but all counterparts shall together constitute but one and the same instrument.

 

IN WITNESS WHEREOF, the Parties, through their authorised officers, have executed this Agreement as of the date first written above.

 

Signed for and on behalf of

 

Signed for and on behalf of

BAYER HEALTHCARE AG

 

GW PHARMA LIMITED

 

 

 

Leverkusen, 4th November 2003

 

Salisbury, 4th November 2003

 

 

 

/s/ Dietrich Brocks

 

/s/ Justin Gover

Dr. Dietrich Brocks
Head of International Cooperations and
Licensing Europe

 

Justin Gover
Managing Director

 

 

 

/s/ Alexander Bey

 

/s/ David Kirk

Dr. Alexander Bey
Law and Patents

 

David Kirk
Finance Director

 



 

APPENDIX 3 for Canada

 

LAUNCH CONDITIONS, MILESTONE EVENTS and PAYMENTS

 

PART A

 

The following payments are payable under the provisions of Clause 4 in relation to Canada:

 

1.             Upon the fulfillment of the Launch Conditions for Product for the indication of relief of one primary symptom in patients with MS. 
£1.8 million

 

2.             Upon the fulfillment of the Launch Conditions for Product for the broader indication of relief of more than one primary symptom in patients with MS. 
£1.2 million

 

For the avoidance of doubt, if an indication of relief of more than one primary symptom in patients with MS is obtained at one time, then both the payments in 1 and 2 above are payable.

 

3.             Upon the fulfillment of the Launch Conditions for Product in an indication of relief of a    ***   . 
£   ***

 

4.             the fulfillment of the Launch Conditions for Product in the broader indication of    ***   .   
£   ***

 

For the avoidance of doubt, if an indication of relief of neuropathic pain is obtained at one time, then both the payments in 3 and 4 above are payable.

 

5.             Upon the fulfillment of the Launch Conditions for Product in the indication of the relief of cancer pain. 
£0.75 million

 

6.             GW may at its sole discretion elect to receive a further milestone payment of £   ***    in the event that BAYER’s Net Sales in Canada in Commercial Year 2 exceed ***% of the Net Sales forecast as specified in Appendix 1, Part B of the Supply Agreement as amended by Amendment Number 1.  In the event that GW elects to receive this milestone payment, the Supply Price in respect of incrementel Net Sales above    ***    percent (***%) of the Net Sales forecast shall be reduced to    ***    percent (***%) of the Net Selling Price.  Such reduction in the Supply Price shall be effective retroactively for Commercial Year 2 and for subsequent Commercial Years.

 

TOTAL FOR Canada                         £   ***

 

PART B

 

Launch Conditions for Canada:

 

Approval by the Medicinal Products Regulatory Authority in Canada

 


***         Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 




Exhibit 10.3

 

AMENDMENT NUMBER 2

 

TO THE LICENSE AND DISTRIBUTION AGREEMENT

 

between GW PHARMA LIMITED (“GW”) having its registered office at Porton Down Science Park, Salisbury, Wiltshire SP4 0JQ and BAYER HEALTHCARE AG, Division Pharma, having its registered office at Bayerwerk, 51368 Leverkusen, Germany (“Bayer”)

 

WHEREAS, Bayer and GW executed a License and Distribution Agreement as of the 20th day of May 2003, as amended by Amendment Number 1 dated November 3, 2003;

 

WHEREAS, Bayer and GW wish to extend the period of the Territory Option Procedure for the EEA, Australia and New Zealand;

 

WHEREAS, Bayer agrees to advise GW in certain regulatory and scientific issues.

 

NOW, THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:

 

1.                                      “First Ready Date” shall mean the first business day following a thirty (30) day period after grant of the first Marketing Authorisation for the Product in the UK Territory.

 

2.                                      “Second Ready Date” shall mean the first business day following a three (3) month period after grant of the first Marketing Authorisation for the Product in the UK Territory.

 

3.                                      Until the Second Ready Date, Bayer shall provide — free of charge and upon request of GW — advice to GW relating to certain regulatory and scientific issues concerning the acceptability of the regulatory dossiers for Products in the Territory and in the further countries that may be added to the Territory in accordance with Clause 3.1 of the Agreement

 

4.                                      Clause 3.1, second and third sentence, shall be rephrased as follows:

 

At any time between the Effective Date and the First Ready Date, Bayer may opt to add Australia and New Zealand to the Territory and on the agreed respective Launch Conditions to be set out in Part B of Appendix 3 to this Agreement and otherwise subject to the terms of this Agreement, including without limitation Clause 3.2 below. At any time between the Effective D ate and t he Second Ready D ate, Bayer may opt to add to the Territory certain further countries in the EEA and on the agreed respective Launch Conditions to be set out in Part B of Appendix 3 to this Agreement and otherwise subject to the terms of this Agreement, including without limitation Clause 3.2 below. Failure to agree any respective Launch Conditions by the First Ready Date in respect of Australia and New Zealand and by the Second Ready Date in respect of countries in the EEA will result in GW being free to enter into a binding agreement with one or more Third Parties with respect to such countries unless the Parties shall have mutually agreed in writing to an extension to finalise such terms.

 

5.                                      This Amendment shall be executed in two counterparts, but shall not be effective until each party has executed at least one counterpart. Each counterpart shall constitute an original of this Amendment, but all counterparts shall together constitute but one and the same instrument.

 



 

IN WITNESS WHEREOF, the Parties, through their authorised officers, have executed this Agreement as of the date first written above.

 

Signed for and on behalf of

Signed for and on behalf of

 

 

BAYER HEALTHCARE AG

GW PHARMA LIMITED

 

 

Leverkusen, 14 January 2004

Salisbury, 14 January 2004

 

 

 

 

/s/ Dietrich Brocks

 

 

/s/ Justin Gover

Dr. Dietrich Brocks

 

 

Justin Gover

Head of International Cooperations

 

 

Managing Director

and Licensing Europe

 

 

 

 

 

 

 

 

 

 

 

/s/ Dirk Ehle

 

 

/s/ David Kirk

Dr. Dirk Ehle

 

 

David Kirk

Law and Patents

 

 

Finance Director

 

2




Exhibit 10.4

 

***Text Omitted and Filed Separately with the Securities and Exchange Commission.

Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406

 

AMENDMENT NUMBER 3

 

TO THE LICENSE AND DISTRIBUTION AGREEMENT

 

between GW PHARMA LIMITED (“GW”) having its registered office at Porton Down Science Park, Salisbury, Wiltshire SP4 OJQ and BAYER HEALTHCARE AG, Division Pharma, having its registered office at Bayerwerk, 51368 Leverkusen, Germany (“Bayer”)

 

WHEREAS, Bayer and GW executed a License and Distribution Agreement as of the 20th day of May 2003, as amended by Amendments Number 1 and 2;

 

WHEREAS, Bayer and GW now wish to complete Appendices 5 and 6 for the Canadian Territory.

 

NOW, THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:

 

1.                                      Appendix 5, Part B, and Appendix 6, Part B, are completed for the Canadian Territory in the form attached to this Amendment.

 

2.                                      This Amendment shall be executed in two counterparts, but shall not be effective until each party has executed at least one counterpart. Each counterpart shall constitute an original of this Amendment, but all counterparts shall together constitute but one and the same instrument.

 

IN WITNESS WHEREOF, the Parties, through their authorised officers, have executed this Agreement as of the date first written above.

 

Signed for and on behalf of

 

Signed for and on behalf of

 

 

 

BAYER HEALTHCARE AG

 

GW PHARMA LIMITED

 

 

 

Leverkusen, February 22, 2005

 

Salisbury, March 1st 2005

 

 

 

/s/ Dr. Horst Harenberg

 

/s/ Justin Gover

Dr. Horst Harenberg
Head of International Cooperations
and Licensing Europe

 

Justin Gover
Managing Director

 

 

 

 

 

 

/s/ Dr. Dirk Ehle

 

/s/ David Kirk

Dr. Dirk Ehle
Law and Patents

 

David Kirk
Finance Director

 



 

APPENDIX 5

 

ORDERS FOR PRODUCTS

 

The following provisions apply under the provisions of Clause 3 in relation to the following countries of the Territory:

 

PART B

 

Canadian Territory

 

1.                                      Bayer Inc. through Bayer shall provide to GW within the first five working days of each month with a forecast APPENDIX of demand for the Product(s) for at least the following   ***    (***) months (“Forecast APPENDIX”). The forecast APPENDIX shall be updated monthly. In addition and subject to Clauses 2 - 7 below, Bayer shall GW during the Fourth (4th) quarter of each calendar year with an annual forecast for the following calendar year which shall serve as a basis for the ordering system and shall not contain binding orders but quantities corresponding to the first twelve (12) months of the Forecast APPENDIX. Against this annual forecast Bayer will formally call off the respective quantities.

 

2.                                      Based on the *** month projected forecast, Bayer shall provide GW the Purchase Order Requirements which may represent half or full batches of requirements, notwithstanding that the first *** (***) months is the Firm Order Period. A purchase order will be forwarded by Bayer to GW for each firm requirement. Bayer Inc. will generate and provide Bayer one (1) purchase order projecting the total yearly purchase based on the forecast. GW will be provided with Bayer and Bayer Inc. purchase order and will ensure that all shipments (packaging slip) reference the Bayer Inc and Bayer purchase order, article code, batch number, weight and volume.

 

3.                                      The quantities of the Products detailed in the first *** (***) months of each Forecast APPENDIX (“Firm Order Period”) shall (to the extent set out in Appendix 5) constitute a binding commitment on Bayer in relation to each Country to purchase such quantities of the Products from GW on the terms and conditions of this Agreement (“Firm Order”). With respect to each Bayer Inc, Bayer shall issue to GW a Firm Order for the quantity of the Products ordered for the Firm Order Period not later than *** (***) weeks prior to the Delivery date specified therein. The Firm Order shall specify the arrangements for Delivery of the Products. The Parties agree that all Firm Orders for the Products placed by Bayer with GW under this Agreement shall be supplied on the terms of this Agreement.

 

4.                                      In determining Firm Order quantities for Canada, Bayer shall take account of Manufacturing batch sizes, such that Bayer must accept a half or full batches per order and the orders are fulfilled orders, actual quantities of Products Manufactured which are within a margin of *** (***) percent of the Firm Order quantity. In the event GW supplies quantities in an aggregated shortfall of more than thirty (30) percent, then GW shall discuss with Bayer Inc and AG whether they are obliged to make up such shortfall quantities as early as possible. The Manufacturing of a full batch size for the Products shall be *** (   ***   ) vials (   ***   ) and half a batch quantity will represent *** (   ***   ) vials (   ***   ). Any variance to the order quantity shall be notified by GW to Bayer Inc. & Bayer in writing.

 

5.                                      The volumes detailed in the *** (***) months after the Firm Order Period of the Forecast APPENDIX (the “Semi-Firm Order Period”, being months ***) shall represent a semi-firm

 


***         Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

2



 

                                                order for each Canada, meaning that Bayer shall be obliged to order and purchase at least ***% of the initial forecast for any month *** forecast. For the avoidance of doubt the initial forecast for any month 8 forecast may not vary by more than thirty percent (+1-) by the time that forecast becomes a Firm Order. GW shall hold sufficient stocks of intermediates to meet the forecast requirements during the Firm Order Period and up to    ***     percent (***%) of the forecast requirements detailed in the Semi-firm Order Period. Both Parties shall conduct their businesses so as to minimize any stock write-offs. Bayer Inc. may ask GW for additional quantities to be manufactured and delivered by GW. GW shall use its reasonable efforts to comply with Bayer Inc. additional demand. In any case GW shall give notice to Bayer Inc and Bayer within two (2) business days if additional quantity will be required.

 

6.                                      GW shall respond to each Firm Order received from Bayer within three (3) business days of receipt. The response shall include confirmation of the Delivery dates and quantity as set out in the Firm Order. In the event that discussion is required regarding the timings of production and Delivery then the relevant planning personnel from both Parties will negotiate in good faith and agree and confirm in writing an amended Forecast APPENDIX within four (4) business days of receipt by GW of the original Forecast APPENDIX except during the period 20th December to 6th January in each year when the periods of three (3) or four (4) business days referred to herein shall be replaced by eight (8) business days in each case.

 

7.                                      It is understood that volumes detailed in relation to the remaining *** (***) months of the Forecast APPENDIX after the Firm Order Period and the Semi-Order Period constitute an estimate of the future Product requirement of Bayer Inc. and its Affiliates for each Country within the Territory and do not comprise any minimum purchase requirement or any binding commitment by Bayer or its affiliates to purchase such volume of the Products.

 

8.                                      Binding orders subject to approval in the Territory for Bayer Inc. requirements of Launch Stocks shall be provided by Bayer Inc. and Bayer within ten (10) business days of the Effective Date. The delivery date shall be agreed by the UK Country Commercialization Committee. Bayer shall notify GW in writing with a copy to Bayer Inc. of the Delivery date for the Launch Stocks at least *** (***) weeks before due delivery date specified for Launch.

 


***         Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

3



 

APPENDIX 6

 

DELIVERY OF PRODUCTS

 

The following provisions apply under the provisions of Clause 4 in relation to the following countries of the Territory:

 

PART B

 

Canadian Territory

 

1.                                      GW shall ensure that the Products manufactured hereunder are delivered in Canada in accordance with the provisions of this Agreement. The costs of Delivery of the Products from GW or the premises of its Authorized Contractor as appropriate to Bayer’s nominated distribution centre or other nominated location in the Canada in question shall be borne by Bayer Inc.

 

2.                                      With respect to Launch Stocks and for all the Products Manufactured with a maximum permitted shelf life of *** (***) months, there shall be a minimum of *** (***) months’ shelf life remaining on the Products at the date of Delivery requested by Bayer Inc. on each Bayer Inc. order. In the case of any of the Products with less than *** (***) months’ shelf-life, the Products shall be returned to GW at GW’s reasonable cost and replaced with Product having the required shelf-life at no cost to Bayer, unless Bayer Inc. and Bayer accepts these products for sale.

 

3.                                      In the event that the shelf-life permitted by a Governmental Authority applicable to a Country is extended beyond *** (***) months or to any other period the Parties shall negotiate in good faith and agree in writing the revised shelf life remaining on the Products upon Delivery to Bayer Inc. and the date upon which the first Delivery shall be made of the Products with such extended shelf-life PROVIDED ALWAYS THAT at the date of Delivery requested by Bayer Inc. on each Bayer and Bayer Inc. order the shelf life remaining on the Products at the date of Delivery shall be at least    ***     percent (*** %) of the total shelf life available for the Products or *** (***) months. In the event that the said Governmental Authority approves an extension to the shelf-life beyond *** (***) months or approval for the    ***     size, the Parties shall develop an implementation and transition to plan to minimize write-off costs for the    ***     vial and to ensure minimum disruption to patients and any write-offs costs shall be shared equally. Bayer Inc. shall undertake to launch the     ***      vial for the Products, upon agreement as to the transitional arrangements, and subject to approval by the Governmental Authority and availability of stocks of the Products from GW to satisfy Bayer Inc. Firm Order requirements.

 

4.                                      In the event of a delay caused by the acts or omissions of a Governmental Authority in a Country resulting in a delayed Launch beyond the Launch date to be agreed between the parties in writing and Bayer Inc. is not able to sell such part or all of the Launch Stocks, the Parties shall equally share GW’s write-off costs of the destruction of any Launch Stocks of the Products calculated in accordance with Appendix 5. GW shall provide replacement stocks in respect of any destroyed Launch Stocks as soon as is reasonably practicable. If GW has invoiced Bayer with any proportion of such destroyed Launch Stocks GW shall credit Bayer with the invoiced value of that proportion of the Launch Stocks.

 


***         Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

4



 

5.                                      In the event that GW fails to deliver in response to the Firm Orders for the Products for a Country on the specified Delivery date by reason of delay, GW shall provide a revised Delivery date. In the event that Delivery is more than ten (10) business days later than the original specified Delivery date, GW shall provide to Bayer and Bayer INC. an action plan to achieve within twenty (20) business days from the original delivery date and Bayer Inc. is able to demonstrate that it has thereby suffered a material stock shortage of the Products at its nominated distribution centre                      ***                        

                                                                                                                                                                                           :

 

***

 

***

***

 

***

***

 

***

***

 

***

 

 

 

***

 

 

 


***         Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

5




Exhibit 10.5

 

***Text Omitted and Filed Separately with the Securities and Exchange Commission.

Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406

 

AMENDMENT NUMBER 4

 

TO THE LICENSE AND DISTRIBUTION AGREEMENT

 

between GW PHARMA LIMITED (“GW”) having its registered office at Porton Down Science Park, Salisbury, Wiltshire SP4 0JQ and BAYER HEALTHCARE AG, Division Pharma, having its registered office at Bayerwerk, 51368 Leverkusen, Germany (“Bayer”)

 

WHEREAS, Bayer and GW executed a License and Distribution Agreement as of the 20th day of May 2003, as amended by Amendments Number 1, 2 and 3;

 

WHEREAS, Bayer and GW wish to amend certain clauses under the License and Distribution Agreement on the terms set out in this Amendment Number 4;

 

WHEREAS, Bayer and GW agreed to terminate the Subscription Option Agreement dated the 20th day of May 2003 on the terms set out in this Amendment Number 4;

 

NOW, THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:

 

1.              The definition of the “First Ready Date”, as established by Amendment Number 2 to the License and Distribution Agreement, shall be revised as follows:

 

“First Ready Date” shall mean the earlier of (i) the sixth business day after grant of the first Marketing Authorisation for the Product in the UK Territory and (ii) 16 September 2005.

 

2.              The definition of the “Second Ready Date”, as established by Amendment Number 2 to the License and Distribution Agreement, shall be revised as follows:

 

“Second Ready Date” shall mean 16 September 2005.

 

3.              The existing Clause 3.1 of the License and Distribution Agreement shall be deleted in its entirety and replaced with the following:

 

“Subject to Clause 3.3, at any time between the Effective Date and the First Ready Date, Bayer may opt to add Australia and New Zealand to the Territory and on the agreed respective Launch Conditions to be set out in Part B of Appendix 3 to this Agreement and otherwise subject to the terms of this Agreement (including without limitation Clause 3.2 below). Subject to Clause 3.3, at any time between the Effective Date and the Second Ready Date, Bayer may opt to add to the Territory certain further countries in the EEA and the United States of America, and on the agreed respective Launch Conditions to be set out in Part B of Appendix 3 to this Agreement and otherwise subject to the terms of this Agreement (including without limitation Clause 3.2 below) and, if applicable, subject also to agreement between Bayer and GW in relation to any revisions to this Agreement required and/or appropriate under applicable law and regulation by reason of the proposed addition of a country or countries to the Territory,. Failure to agree any respective Launch Conditions by the First Ready Date in respect of Australia and New Zealand and by the Second Ready Date in respect of countries in the EEA and the United States of America will result in GW being free to enter into a binding agreement with one or more Third Parties with respect to such countries unless the Parties shall have mutually agreed in writing to an extension of the period within which to finalise such terms.”

 



 

4.              A new Clause 3.3 shall be included in the following terms:

 

“Bayer undertakes and agrees to provide GW by no later than 30 June 2005 written confirmation of those countries referred to in Clause 3.1 above (which it is entitled to add to the Territory pursuant to Clause 3.1) which it intends to extend to the Territory. Any countries not expressly referred to in such written confirmation shall be deemed excluded from the Territory extension procedure contained in Clause 3.1 “

 

5.              Appendix 3, Part A.1 (UK Territory) shall be replaced by Appendix 1, Part A.1 (UK Territory), as attached to this Amendment.

 

6.              Appendix 3, Part A.2 (Canada Territory), as attached to Amendment Number 1 to the License and Distribution Agreement, shall be replaced by Appendix 1, Part A.2 (Canada Territory), as attached to this Amendment.

 

7.              This Amendment Number 4 shall be executed in two counterparts, but shall not be effective until each party has executed at least one counterpart. Each counterpart shall constitute an original of this Amendment, but all counterparts shall together constitute but one and the same instrument.

 

IN WITNESS WHEREOF, the Parties, through their authorised officers, have executed this Amendment Number 4 as of the date first written above.

 

Signed for and on behalf of

BAYER HEALTHCARE AG
Leverkusen, May 9, 2005

 

Signed for and on behalf of

GW PHARMA LIMITED
Salisbury, May 10 2005

 

 

 

 

 

 

   /s/  Dr. Horst Harenberg

 

   /s/ Justin Gover

Dr. Horst Harenberg
Head of International
Cooperations and Licensing
Europe

 

Justin Gover
Managing Director

 

 

 

 

 

 

   /s/ Dr. Dirk Ehle

 

   /s/ David Kirk

Dr. Dirk Ehle
Law and Patents

 

David Kirk
Finance Director

 

2



 

APPENDIX 3 for the UK Territory

 

LAUNCH CONDITIONS, UPFRONTS, MILESTONE EVENTS and PAYMENTS

 

PART A

 

The following payments are payable under the provisions of Clause 4 in relation to the following countries of the Territory:

 

A1.          UK Territory

 

1.              Upon entry by GW and Bayer into this Agreement payable on signature £5 million (payment already executed)

 

2.              Upon the grant of a Marketing Authorisation by the UK MHRA (or successor body) for Product such sum as is equal to the sum of
£6 million

 

3.              Upon the grant of a Marketing Authorisation by the UK MHRA (or successor body) for Product for the indication of relief of one or more primary symptoms in patients with MS. £4 million

 

4.              Upon the grant of a Marketing Authorisation by the UK MHRA (or successor body) for Product in the indication of     ***    .
£***

 

5.              Upon the grant of a Marketing Authorisation by the UK MHRA (or successor body) for Product extract in the indication of      ***     .
£***

 

6.              Subject to paragraph 9, in the event that Bayer’s Net Sales in the UK Territory in Commercial Year 1 exceed the Net Sales forecast as specified in Appendix 1, Part A of the Supply Agreement (as amended by Amendment Number 2), for each ***% (*** percent) in excess of the Net Sales forecast an amount of £*** million, up to a maximum (which would be achieved in the event that BAYER’s Net Sales forecasts are exceeded by ***%) of £***

 

7.              Subject to paragraph 9, in the event that Bayer’s Net Sales in the UK Territory in Commercial Year 2 exceed the Net Sales forecast as specified in Appendix 1, Part A of the Supply Agreement (as amended by Amendment Number 2), for each *** % (*** percent) in excess of the Net Sales forecast an amount of £***million, up to a maximum (which would be achieved in the event that BAYER’s sales forecasts are exceeded by ***%) of £***

 

8.              Subject to paragraph 9, in the event that Bayer’s Net Sales in the UK Territory in Commercial Year 3 exceed the Net Sales forecast as specified in Appendix 1, Part A of the Supply Agreement (as amended by Amendment Number 2), for each *** % (*** percent) in excess of the Net Sales forecast an amount of £*** million, up to a maximum (which would be achieved in the event that Bayer’s sales forecasts are exceeded by ***%) of £***

 

9.              With respect to the payments referred to in paragraphs 6, 7 and 8 above, if Bayer’s Net Sales in the 4th quarter of each of the first 3 Commercial Years fall below the average of Bayer’s Net Sales in the preceding two quarters, then that year’s additional milestone payment shall be deemed to be £*** and shall become immediately payable.

 

10.        Additionally, at the end of the first 3 Commercial Years, Bayer’s actual cumulative Net Sales shall be compared to Bayer’s total Net Sales forecast for this 3 year period as

 


***         Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

3



 

contained in Appendix 1, Part A of the Supply Agreement (as amended by Amendment

 

Number 2). For each ***% by which Bayer’s actual cumulative Net Sales exceed Bayer’s total Net Sales forecast, £*** shall be payable, provided that any sums due and payable hereunder shall be reduced by an amount equal to any payments made pursuant to paragraphs 6, 7, 8 and 9 above).

For the avoidance of doubt, GW’s maximum entitlement under paragraphs 6, 7, 8, 9 and 10 shall not exceed £***, which would be achieved in the event that Bayer’s 3 year cumulative Net Sales forecasts are exceeded by ***%.

 

11.        For the avoidance of doubt, Bayer undertakes and agrees that it will or will procure the incurring of the sales and marketing expenditure as presented to Bayer’s Commercialisation Committee prior to the commencement of each of the first 3 Commercial Years irrespective of the additional milestone payment provisions contained in paragraphs 6, 7, 8, 9 and 10 above. For the further avoidance of doubt, Bayer undertakes and agrees that the additional milestone payment provisions contained in paragraphs 6, 7, 8, 9 and 10 above shall have no adverse impact upon the UK Bayer personnel bonus payment structures or payments.

 

TOTAL FOR UK TERRITORY

 

£***million

 


***         Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

4



 

APPENDIX 3 for the Canada Territory

 

LAUNCH CONDITIONS, MILESTONE EVENTS and PAYMENTS

 

PART A

 

The following payments are payable under the provisions of Clause 4 in relation to Canada:

 

A.2 Canada Territory

 

1.              Upon the fulfillment of the Launch Conditions for Product for the indication of relief of one primary symptom in patients with MS.
£1.8 million

 

2.              Upon the fulfillment of the Launch Conditions for Product for the broader indication of relief of more than one primary symptom in patients with MS.
£1.2 million.

 

For the avoidance of doubt, if an indication of relief of more than one primary symptom in patients with MS is obtained at one time, then both the payments in 1 and 2 above are payable.

 

3.              Upon the fulfillment of the Launch Conditions for Product in an indication of relief of a form of     ***    .
£***

 

4.              Upon the fulfillment of the Launch Conditions for Product in the ***   .
£***.

 

For the avoidance of doubt, if an indication of relief of    ***    is obtained at one time, then both the payments in 3 and 4 above are payable.

 

5.              Upon the fulfillment of the Launch Conditions for Product in the indication of      ***     .
£***

 

6.              GW may at its sole discretion elect to receive a further milestone payment of £*** million in the event that BAYER’s Net Sales in Canada in Commercial Year 2 exceed ***% of the Net Sales forecast as specified in Appendix 1, Part B of the Supply Agreement as amended by Amendment Number 1. In the event that GW elects to receive this milestone payment, the Supply Price in respect of incremental Net Sales above    ***    percent (***%) of the Net Sales forecast shall be reduced to    ***   percent (***%) of the Net Selling Price. Such reduction in the Supply Price shall be effective retroactively for Commercial Year 2 and for subsequent Commercial Years.

 

7.              Upon signature of this Amendment No. 4 and in consideration for the first approval of Sativex in Canada and the inclusion of the United States of America in Clause 3.1. of the Licence and Distribution Agreement.
£1.0 million.

 

Total for Canada

£*** million

 


***         Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

5




Exhibit 10.6

 

Amendment # 5

 

to the License and Distribution Agreement by and between Bayer Schering Pharma AG (formerly “Bayer AG, Bayer HealthCare, Division Pharma”) and GW Pharma Limited dated May 20, 2003 — hereinafter referred to as “Distribution Agreement” —

 

between                                                   Bayer Schering Pharma AG
Muellerstrasse 178
D-13353 Berlin
Germany
- hereinafter referred to as “BAYER” -

 

and                                                                           GW Pharma Limited
Porton Down Science Park
Salisbury, Wiltshire SP4 0JQ
- hereinafter referred to as “GW” –

 

WHEREAS, Bayer AG has transferred its Division Pharma to Bayer HealthCare AG following the execution of the Distribution Agreement in 2003;

 

WHEREAS, Bayer HealthCare AG merged with BAYER effective as of December 30, 2008, with BAYER as the universal successor so that BAYER is the new contracting party to the Distribution Agreement;

 

WHEREAS, BAYER and GW have entered into the Distribution Agreement by which BAYER was appointed as GW’s exclusive distributor to sell, offer for sale, market, promote and distribute the Products (as defined in the Distribution Agreement) in the Territory (as defined in the Distribution Agreement);

 

WHEREAS, BAYER and GW intend to amend the Distribution Agreement in respect of the term.

 

NOW, THEREFORE, the PARTIES agree to the following:

 

1.                                      Unless otherwise defined in this Amendment # 5 all words written in capital letters shall bear the meaning as defined in the Distribution Agreement.

 

2.                                      Section 12.1 sentence 1 part 1 of the Distribution Agreement shall be deleted and replaced by the following wording:

 

“This Agreement shall continue until the expiry of fifteen (15) years from the date on which the Marketing Authorisation is granted for the UK Territory (“Initial Term”), ...”.

 

1



 

3.                                      This Amendment # 5 shall form an integral part of the Distribution Agreement and shall be regarded as incorporated into the Distribution Agreement in every respect. All other terms and conditions of the Distribution Agreement shall remain in force unchanged.

 

4.                                      This Amendment # 5 shall take effect upon its execution.

 

5.                                      In all other respects, the terms of the Distribution Agreement shall remain unchanged.

 

This Amendment # 5 has been made in duplicate and signed by the PARTIES hereto.

 

Bayer Schering Pharma AG

 

 

 

 

 

/s/ Dr. Berthold Hinzen 5/3/2010

 

/s/ i.v. Klaus Deimel 5/3/2010

Dr. Berthold Hinzen

 

Klaus Deimel

Head Global Licensing General

 

Head Business Development Region

Medicine

 

Europe

 

 

 

 

 

 

GW Pharma Limited

 

 

 

 

 

/s/ Justin Gover

 

/s/ David Kirk

Name:

Justin Gover

 

Name:

David Kirk

Title:

Managing Director

 

Title:

Finance Director

Date:

10 March 2010

 

Date:

10 March 2010

 

2




Exhibit 10.7

 

***Text Omitted and Filed Separately with the Securities and Exchange Commission.

Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406

 

 

BAYER AG

 

 

and

 

 

GW PHARMA LTD

 

 

 

SUPPLY AGREEMENT

 

 



 

CONTENTS

 

 

 

1. DEFINITIONS

3

2. SUPPLIER’S OBLIGATIONS

6

3. ORDERS FOR PRODUCTS

6

4. DELIVERY OF PRODUCTS

7

5. PASSING OF PROPERTY AND RISK IN PRODUCT

7

6. PRICE OF PRODUCTS

7

7. INVOICE AND PAYMENT

7

8. FAILURE TO SUPPLY; SECURITY OF SUPPLY

8

9. QUALITY OF PRODUCTS

11

10. SUPPLY AND STORAGE OF MATERIALS AND PRODUCTS

12

11. MARKETING AUTHORISATION

13

12. MANUFACTURE OF PRODUCTS

13

13. LABELLING AND ARTWORK

13

14. HAZARDS

14

15. WARRANTIES AND INDEMNITY

14

16. DURATION AND TERMINATION

14

17. CONSEQUENCES OF TERMINATION

15

18. AUTHORISED CONTRACTORS

16

19. REFERENCE

16

APPENDIX 1 - THE SUPPLY PRICES

18

APPENDIX 2 - DRAFT SPECIFICATIONS OF PRODUCTS

20

APPENDIX 3 - QUALITY AGREEMENT

21

APPENDIX 4 - POWER OF ATTORNEY

22

APPENDIX 5 - ORDERS FOR PRODUCTS

23

APPENDIX 6 - DELIVERY OF PRODUCTS

25

 

2



 

SUPPLY AGREEMENT

 

THIS SUPPLY AGREEMENT (“Agreement”) is made the 20th day of May 2003 between BAYER AG, Bayer HealthCare, Division Pharma, having its registered office at Bayerwerk, 51368 Leverkusen, Germany (“Bayer”) and GW PHARMA LIMITED having its registered office at Porton Down Science Park, Salisbury, Wiltshire SP4 0JQ (“GW”).

 

WHEREAS, GW is the owner of all right, title and interest in certain patents and know-how relating to certain cannabinoid products and desires to grant a licence to the rights to sell and distribute such cannabinoid products in the Territory;

 

WHEREAS, Bayer and its Affiliates have experience in the market development, marketing, promotion and sale of pharmaceutical products and desires to obtain a licence to the rights to sell and distribute such cannabinoid products in the Territory and GW is willing to grant to Bayer such rights;

 

WHEREAS, GW and Bayer entered into a License and Distribution Agreement, a Loan Agreement and a Subscription Option Agreement as of the date hereof; and

 

WHEREAS, Bayer wishes to purchase the Products manufactured by GW for sale and distribution in the Territory and GW wishes to supply such Products to Bayer.

 

NOW, THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:

 

1.                                     DEFINITIONS

 

1.1.                           “Affiliate(s)” shall have the meaning defined in the License and Distribution Agreement.

 

1.2.                           “Agreement” shall mean this supply agreement together with all its appendices including without limitation the Quality Agreement (the “Appendi(x)(ces)”).

 

1.3.                           “Authorised Contractors” shall mean ***; *** and ***.

 

1.4.                           “Bayer Sales” shall mean the sales of units of Product ex warehouse reported by Bayer in each Country.

 

1.5.                           “Commercial Year” shall mean the twelve (12) month period in each Country beginning with the month following the Launch date and each subsequent twelve (12) month period.

 

1.6.                           “Contract Governance Committee” shall have the meaning defined in the License and Distribution Agreement.

 

1.7.                           “Controlled Drugs Authority” shall have the meaning defined in the License and Distribution Agreement.

 

1.8.                           “Country” shall mean each country within the Territory.

 

1.9.                           “Country Commercialisation Committee(s)” shall have the meaning defined in the License and Distribution Agreement.

 


***         Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

3



 

1.10.                    “Delivery” shall mean the Products either available for collection by Bayer or its appointed carrier for transporting to the Bayer nominated warehouse; or available for delivery by GW or its appointed carrier to the Bayer nominated warehouse as notified by Bayer and “Deliver” and “Delivered” shall be construed accordingly.

 

1.11.                    “Effective Date” shall mean the date upon which this Agreement is effective and shall be the date of this Agreement first above written.

 

1.12.                    “Estimated Supply Prices” shall mean the List Prices for the Products in a Country less the wholesaler discount agreed in writing from time to time between the Parties based on the agreed standard prevailing wholesaler discount in the Country in question multiplied by the relevant Supply Price percentage as stated in Appendix 1 to this Agreement.

 

1.13.                    “Good Manufacturing Practice” or “GMP” shall mean the regulatory standards and principles and guidelines of Good Manufacturing Practice as in force from time to time relating to the production of medicinal products established by the applicable Governmental Authority applicable anywhere in the Territory including, without limitation, the Guidelines on Good Manufacturing Practice of Medicinal Products for Human Use published by the European Commission, as the same may be amended from time to time. GMP includes Good Distribution Practice (“GDP”) as defined by Directive 2001/83/EC for the purposes of this Agreement.

 

1.14.                    “Governmental Authority” shall have the meaning defined in the License and Distribution Agreement.

 

1.15.                    “Gross Sales” shall mean the gross amounts invoiced by Bayer in respect of the sales of the Products in the Territory under this Agreement by Bayer or its Affiliates to third parties at an arm’s length open market price.

 

1.16.                    “IMS” shall mean Intercontinentall Medical Statistics or any other agreed source.

 

1.17.                    “IMS Sales” shall mean the total IMS reported sales of Product in each Country.

 

1.18.                   “Indication” shall have the meaning defined in the License and Distribution Agreement.

 

1.19.                    “Intermediates” shall mean the raw materials and components used in the three stages of Manufacture of the Products.

 

1.20.                    “Laboratory” shall mean the independent testing laboratory agreed between the parties for the testing of disputed shipments pursuant to Clause 9.

 

1.21.                    “Launch Conditions” shall have the meaning defined in the License and Distribution Agreement.

 

1.22.                    “Latent Defect” shall mean a defect in a Product existing at the time of receipt by Bayer which is not discovered by visual inspection and which is not attributable to the storage of a Product by Bayer.

 

1.23.                    “Launch” shall have the meaning specified in the License and Distribution Agreement.

 

1.24.                    “Launch Stocks” shall mean those stocks of the Products Manufactured by GW or Authorised Contractors on its behalf as specifically ordered for Launch by Bayer.

 

1.25.                    “Licence and Distribution Agreement” shall mean the agreement of even date for the licensing and distribution of the rights to the Products.

 

1.26.                    “Licence to Manufacture” shall mean the conditional rights to manufacture granted to Bayer under Clause 2.4 of the Licence and Distribution Agreement and more particularly described in Clause 8.2 of this Agreement.

 

4



 

1.27.                    “List Price(s)” shall mean with respect to the UK Territory the prices that pharmacists are paid for the Products by the Governmental Authorities in a Country or the nearest equivalent price in other Countries of the Territory.

 

1.28.                    “Manufacture” shall mean the planning, purchasing, cultivating, extracting, manufacture, processing, compounding, storage, filling, packaging, labelling, leafleting, testing, sample retention, stability testing, release, QP certification and despatch of the Products (or procurement of the same) and “Manufactured” and “Manufacturing” shall be construed accordingly.

 

1.29.                    “Manufacturing Know-How” shall mean the technical information and know-how in the possession or under the control of GW relating to the Manufacture and formulation of the Products.

 

1.30.                    “Manufacturing Licence” shall mean all licences necessary for or in connection with the Manufacture of the Products at the Manufacturing Site(s).

 

1.31.                   “Manufacturing Site” shall mean the manufacturing facility of GW or such other manufacturing facility of GW or of any Authorised Contractor appointed by GW under this Agreement applicable to the Manufacture of the Products.

 

1.32.                    “Marketing Authorisation(s)” shall have the meaning defined in the License and Distribution Agreement.

 

1.33.                    “Net Sales” shall have the meaning defined in the License and Distribution Agreement.

 

1.34.                    “Net Selling Price” shall mean Net Sales per unit of Product.

 

1.35.                    “Out of Stock Situation” shall have the meaning specified in Clause 8.2.4.

 

1.36.                    “Party(ies)” shall have the meaning defined in the License and Distribution Agreement.

 

1.37.                    “Person Day” shall mean eight (8) hours work by a representative of GW qualified to assist in transfer of the Manufacturing Know-How.

 

1.38.                    “Products” shall have the meaning defined in the License and Distribution Agreement.

 

1.39.                    “Qualified Person” (or “QP”) shall mean the person responsible for releasing or certifying each batch of the Products for sale.

 

1.40.                    “Quality Agreement” shall mean the agreement to be entered into between GW and the Authorised Contractors and the agreement to be entered into between GW and Bayer as required by the Governmental Authority relating to the Manufacture, storage or distribution of the Products to be attached hereto as Appendix 3 in accordance with the requirements of Council Directive 2001/83/EEC.

 

1.41.                    “Specifications” shall mean the specifications applicable to the Products in accordance with a Marketing Authorisation, drafts of which are attached as Appendix 2 to this Agreement.

 

1.42.                    “Supply Price(s)” shall mean the prices of the Products set out in Appendix 1 to this Agreement.

 

1.43.                    “Technical Manager(s)” shall mean the person nominated in writing by Bayer and the person nominated in writing by GW who will be responsible for technical matters relating to the implementation of this Agreement (and such other persons as may from time to time be substituted by either Party for such persons).

 

1.44.                    “Territory” shall have the meaning defined in the License and Distribution Agreement.

 

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1.45.                   “Trade Mark” shall mean such trade mark as Bayer may from time to time request GW to affix during Manufacture of the Products as set out in Appendix 5 of the License and Distribution Agreement.

 

1.46.                    “UK Territory” shall have the meaning defined in the License and Distribution Agreement.

 

1.47.                    “Wholesale Dealer’s Licence” shall mean the consent, licence or approval granted by a Governmental Authority in a Country required in order to supply medicinal products on a wholesale basis.

 

1.48.                    In this Agreement unless it is inconsistent with the context a reference to a statutory provision includes a reference to:

 

(i)            a statutory amendment, modification, substitution, consolidation or re-enactment (whether before or after the date of this Agreement);

 

(ii)           statutory instruments or subordinate legislation or orders made under the statutory provision; and

 

(iii)          statutory provisions of which the statutory provision is an amendment, modification, substitution, consolidation or re-enactment.

 

Unless the context of this Agreement otherwise requires,

 

(i)             words of one gender includes the other gender;

 

(ii)            words using the singular or plural number also include the plural or singular number respectively;

 

(iii)           the terms “hereof”, “herein”, “hereby” and derivative or similar words refer to this entire Agreement; and

 

(iv)          the terms “Clause” and “Appendix” refer to the specified Clause and Appendix of this Agreement.

 

When this Agreement refers to a number of days, unless otherwise specified (as business days in which case reference shall be made to normal UK working days), such number shall refer to calendar days. When this Agreement refers to a number of years and/or months, unless otherwise specified, such number shall refer to calendar years and/or months.

 

2.                                     SUPPLIER’S OBLIGATIONS

 

2.1.                           In accordance with the terms of this Agreement and subject to Clause 16.2, GW shall Manufacture Bayer’s requirements for the Products as ordered from time to time by Bayer in accordance with Appendix 5 except in circumstances where GW is unable to supply Bayer with its requirements for the Products in accordance with this Agreement in which case the provisions of Clause 8.2 below shall apply.

 

2.2.                           GW shall Manufacture the Products at the Manufacturing Site(s) in accordance with Good Manufacturing Practice, the Specifications, the Manufacturing Licence, approvals of a Governmental Authority and all laws and regulations relevant to the Manufacture of the Products. Without prejudice to the foregoing, GW shall not change any Manufacturing Site in which the Products are Manufactured, or the Intermediates, process or plant used in the Manufacture of the Products without first notifying Bayer in advance in writing and obtaining Bayer’s prior written consent which shall not be unreasonably withheld. In the event that Bayer responds to such written notice with questions or concerns, the Parties shall promptly meet and discuss any alternative course of action. Bayer acknowledges that GW, as the holder of the Marketing Authorisation, may be required to make any such changes without delay particularly if such changes relate to regulatory requirements or safety concerns.

 

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2.3.                           Any changes in the Specifications for the Products must be agreed in writing by both Parties. Consent from Bayer shall not be unreasonably withheld or delayed.

 

3.                                     ORDERS FOR PRODUCTS

 

3.1.                           Subject to Clause 16.2, Bayer shall purchase its entire requirement of Product from GW.

 

3.2.                           The provisions relating to orders for Products applicable to the UK Territory are set out in Appendix 5.A. The Parties undertake to negotiate in good faith as part of the Launch Conditions adjustments required to such provisions for countries added to the Territory under the Territory Option Procedure set out in Clause 3 of the License and Distribution Agreement. Such adjusted provisions shall be attached as Appendix 5.B etc. for each Country concerned.

 

4.                                     DELIVERY OF PRODUCTS

 

The provisions relating to Delivery of Products applicable to the UK Territory are set out in Appendix 6.A. The Parties undertake to negotiate in good faith as part of the Launch Conditions adjustments required to such provisions for countries added to the Territory under the Territory Option Procedure set out in Clause 3 of the License and Distribution Agreement. Such adjusted provisions shall be attached as Appendix 6.B. etc. for each Country concerned.

 

5.                                      PASSING OF PROPERTY AND RISK IN PRODUCTS

 

5.1.                           The property and risk in the Products shall remain with GW until Delivery at which point they shall pass to Bayer.

 

5.2.                           Neither payment by nor passage of property or risk in the Products to Bayer shall be deemed to constitute acceptance of the Products, with respect to which the provisions of Clause 9.4 below shall apply.

 

6.                                      PRICE OF PRODUCTS

 

6.1.                            The Supply Prices for the Products for the duration of this Agreement are set out in Appendix 1 to this Agreement.

 

6.2.                            In the event that the Net Selling Price for any or all of the Products in a Country within the EEA declines by more than *** percent (***%) from the Net Selling Price at the time of Launch or *** percent (***%) below the lowest ex factory price of Products within other countries within the EEA, whichever is lower, the Parties shall promptly meet and discuss with a view to agree upon a revised Supply Price during the period of the reduced Net Selling Price. In the event of a decline in the Net Selling Price for a Product resulting in the Supply Price falling below GW’s cost of Manufacture for the Products, the Parties shall promptly meet and discuss with a view to agree upon a revised Supply Price during the period of the reduced Net Selling Price. GW shall not be obliged to supply Bayer at a price below its cost of Manufacture with the exception of supplies of goods free of charge specified in Appendix 1.C.

 

7.                                      INVOICE AND PAYMENT

 

7.1.                            The following terms shall apply:

 

7.1.1                     Upon Delivery, GW shall raise an invoice as to total amount due assuming the Products are sold at the Estimated Supply Prices; such invoice shall be faxed or e-mailed at the invoice date to Bayer with a following hard copy by post.

 

7.1.2                     Bayer shall undertake the following reconciliations per Commercial Year: (a) a

 


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reconciliation of amounts at the end of September each year and (b) a reconciliation of amounts at the end of the third quarter of each Commercial Year, both based on amounts invoiced at the Estimated Supply Prices and the Net Sales made during the period between each reconciliation. Bayer shall send the full details of the reconciliation to GW within forty-five (45) days of the end of each reconciliation period. Any underpayments shall be paid to GW against the provision by GW of an invoice in respect of such sum and any overpayment made by Bayer shall be repaid by GW sent with an accompanying statement. Payments to be made to either Party shall be made within sixty (60) days following the reconciliation.

 

7.1.3                     Appendix 1.C shall apply in the event that Product is sold to wholesalers and/or pharmacies in the Territory by authorised wholesalers and/or retailers importing Product from outside the Territory provided that (a) Clause 7.1.3 shall not apply as long as (i) Bayer Sales are       ***       

 

 

                                                                                                           , and (b) this Clause 7.1.3 shall cease to apply if Bayer exercises its Territory Option according to Clause 3 for the entire EEA.

 

7.2.                            Each invoice issued by GW hereunder in each Country shall specify:

 

(a)                                the order number;

 

(b)                                the Estimated Supply Prices and Supply Price percentage in respect of the Products Delivered;

 

(c)                                 the Batch Number or Order Reference of the Products Delivered;

 

(d)                                the quantity of the Products Delivered;

 

(e)                                 the currency (provided that the Parties shall in good faith agree on the currency applicable to the invoices relating to each of the countries within the Territory); and

 

(f)                                  the amount of VAT (as defined in Clause 7.5 below (if any)) due in respect of the invoiced amount.

 

7.3.                            Subject to Clause 7.5 below, payment with respect to each Country shall be made within thirty (30) days after the date of the invoice.

 

7.4.                            Bayer shall provide to GW on a monthly basis details of its Gross Sales and Net Sales in each Country and on a Product by Product basis to enable GW to verify the same within thirty (30) days from the end of each month.

 

7.5.                            All amounts in this Agreement are stated exclusive of Value Added Tax or other sales tax applicable in any Country or the Territory (“VAT”). If VAT, which is or may become properly payable or chargeable in respect of the payments, becomes payable by Bayer, then GW will promptly provide a valid VAT invoice to Bayer. If the VAT charged to and paid by Bayer is subsequently refunded by any relevant fiscal authorities to GW, then such refund shall be promptly forwarded to Bayer with a valid VAT credit note.

 

7.6.                            Bayer shall keep and shall cause its Affiliates to keep complete and accurate records of all Gross Sales and Net Sales of the Products in each Country and GW shall have the right, at GW’s expense, through a certified public accountant or like person reasonably acceptable to Bayer, to examine such records during regular business hours during the life of this Agreement and for six (6) months after its termination; provided however that such examination shall not take place more often than once a

 


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year and shall not cover such records for more than the preceding two (2) years and provided further that such accountant shall report to GW only as to the accuracy of Net Sales. All such costs and expenses in connection with performing any such examination shall be paid by GW unless the examination discloses at least a *** (***%) per cent shortfall, in which case Bayer will bear the full cost of such examination.

 

8.                                      FAILURE TO SUPPLY; SECURITY OF SUPPLY

 

8.1.                           Bayer shall notify GW as soon as reasonably practicable if there is an incomplete Delivery in any Country having regard to the permitted margin of ***% (*** percent) variance in the Firm Order quantities as detailed in Appendix 5 in accordance with the terms of this Agreement. If GW is notified by telephone or in person then such notification shall be confirmed by Bayer in writing. The alleged incomplete Delivery shall then be promptly investigated by the Parties and in the event that it is established that Delivery is in fact incomplete, GW shall then be obliged to rectify the incomplete consignment within twenty (20) business days, from the later of the date of written notification or the Parties reasonably establishing that that Delivery is in fact incomplete.

 

8.2.                           If GW is unable, or anticipates that it will be unable, to supply the Products in accordance with any Firm Orders or Semi-Firm Orders placed in accordance with Appendix 5 for any reason other than for reasons set out in Clause 16 of the Licence and Distribution Agreement incorporated by reference to this Agreement by Clause 19 of this Agreement, the following provisions shall apply:

 

8.2.1                     In respect of the Products for which permitted shelf life is less than *** (***) months, GW shall, as soon as it becomes aware of the fact, give written notice to Bayer of the reasons for the shortfall.

 

8.2.2                     In respect of the Products for which permitted shelf life is equal or greater than *** (***) months, GW shall, as soon as it becomes aware of the fact, and in any event not less than fourteen (14) days before the due Delivery date, give written notice to Bayer of the reasons for the shortfall. Bayer shall notify GW in the event that its stock levels fall below the forecasted level.

 

8.2.3                     Upon service of the notice referred to in Clauses 8.2.1 and 8.2.2 above, the Parties shall enter into discussions in good faith with a view to alleviating its effects or agreeing alternative supply arrangements.

 

8.2.4       Clauses 8.2.5 to 8.2.9 shall only apply where Bayer can demonstrate to the reasonable satisfaction of GW that Bayer will as a result of such inability to supply be out of stock or where Bayer reasonably anticipates being out of stock of the Products during the period for which GW, other than for reasons of delay caused by the acts or omissions of a Governmental Authority, reasonably anticipates that supply of the Products by GW will be interrupted (“Out of Stock Situation”). For the avoidance of doubt, Clauses 8.2.4. to 8.2.7 shall not apply where Bayer is out of stock due to market demand being in excess of the Firm Order or Semi-Firm Order quantities or where the Out of Stock Situation arose as a result of Bayer not exercising prudent stock management disciplines.

 

8.2.5                     Should the Parties have failed to have agreed remedial action in accordance with Clause 8.2.3 during a period of sixty (60) days and Bayer is or reasonably

 


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anticipates being out of stock during the continuing period of interruption reasonably anticipated by GW, then Bayer shall be entitled to take over the partial or total Manufacture of the Products.

 

(i)                                      Bayer shall have the right either to manage that stage of the Manufacture currently undertaken by one or more of the Authorised Contractors or GW or alternatively assume the Manufacture itself of that part of the Manufacturing process and this Agreement shall be amended appropriately to reflect the revised arrangements during which period Bayer shall assume the Licence to Manufacture, subject to appropriate regulatory approvals being obtained.

 

(ii)                                   Depending upon whether Bayer has partial or total responsibility, GW shall become a contractor to Bayer in respect of the first stage of the Manufacturing process and if necessary, at Bayer’s request GW shall assign its contracts with the Authorised Contractors to Bayer.

 

(iii)                                The Manufacturing Licence shall become a sole licence as provided by Clause 2.4 of the Licence and Distribution Agreement.

 

(iv)                               During the period of Manufacture by Bayer the Supply Prices shall be adjusted by good faith negotiation between the Parties enabling GW to receive payment for the Licence to Manufacture based on the Supply Prices but subject to deduction of Bayer’s costs of Manufacture so as to reflect the reasonable costs of Manufacture incurred by Bayer under the revised Manufacturing arrangements required to fulfil Bayer’s sales volumes of the Products for the Territory, and GW’s costs relating to the Manufacture of the Products previously included by GW within the Supply Prices.

 

8.2.6                     GW shall give reasonable assistance to Bayer in transferring Manufacturing to such location or third party as Bayer shall nominate from GW and any of the Authorised Contractors to Bayer on terms of confidence, including reasonable assistance with transferring GW’s Manufacturing Know-How for Manufacture and Confidential Information provided that such third party shall be obliged to maintain the same degree of confidentiality as Bayer under this Agreement. In relation to the transfer of Manufacturing Know-How, GW shall provide ten (10) Person Days of assistance at no cost to Bayer. This Clause 8.2.6 shall apply mutatis mutandis whereby Bayer, at the end of the period referred to Clause 8.2.5 above shall retransfer Manufacturing to GW or any of the Authorised Contractors.

 

8.2.7                     The Manufacturing Know-How and any other information supplied for the purposes of Manufacture shall be treated by Bayer as Confidential Information of GW and Bayer shall not disclose the same except to the third party referred to in Clause 8.2.6. Bayer shall procure that all third parties to which it discloses any such Confidential Information shall also keep it confidential on terms no less onerous than those contained in Clause 8 of the License and Distribution Agreement.

 

8.2.8                     In circumstances where the Parties have reasonably agreed that the continuing period of interruption has ceased and GW wishes to assume the Manufacture of the Products and can reasonably demonstrate to Bayer that it is able to Manufacture the Products to a quality equivalent to that Manufactured by Bayer at the time of cessation, GW shall provide one (1) month’s notice to Bayer during which period the Parties shall define the process for Manufacture to Bayer so as to ensure no interruption in supply to patients. Upon the resumption of Manufacture by GW, the rights granted under Clause 8.2.5 shall automatically cease and Bayer shall promptly return

 

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all Manufacturing information together with such Confidential Information and information provided for the purposes of Manufacture. Bayer shall use its best endeavours to assign back to GW those contracts previously assigned to Bayer with the Authorised Contractors for the purposes of Manufacture by Bayer.

 

8.2.9                     Any Manufacture undertaken by Bayer under the provisions of Clause 8.2.5 of this Agreement would be to fulfil Bayer’s requirements for the sale of the Products in the Territory. On request by GW, Bayer agrees to supply the Products on reasonable commercial terms to GW or any other party for sale outside the Territory.

 

8.3.                           Notwithstanding Clause 8.2 above, the Parties intend to minimise the effect of an Out of Stock Situation and to ensure a continuous and adequate supply of the Product to Bayer in accordance with the terms of this Agreement.

 

8.3.1                     GW has prior to the Effective Date qualified and validated GW’s site in ***, *** and *** for the growing and extracting stage of the Manufacture of the Product and hereby agrees to qualify and validate, at its own cost and expense, a second site for extraction stage of the Manufacture of the Product (the “Second Site”) as soon as practicable after the Effective Date.

 

8.3.2                     GW shall, within thirty (30) business days after the Second Site and — at Bayer’s option — a second site for the packaging to be established by Bayer (the “Bayer Site”) are qualified and validated, apply for and effect any changes, variations or amendments to any relevant Marketing Authorisation that may be required to ensure that the Second Site and the Bayer Site can be used immediately upon the occurrence of an Out of Stock Situation. Bayer shall provide to GW all reasonable co-operation and assistance that may be necessary to enable GW to carry out its obligations hereunder.

 

8.3.3                     GW shall during the term of this Agreement at its own cost and expense prepare, maintain and update the Manufacturing Know How as necessary and as agreed between the Parties so that the Manufacturing Know How is at all times capable of being used to Manufacture or have Manufactured Product. If Bayer specifically requests at any time that the Manufacturing Know How be updated GW shall promptly do so at Bayer’s cost and expense.

 

8.4.                           In the event of an Out of Stock Situation or where Bayer would be entitled to terminate this Agreement pursuant to Clause 16.4 upon GW compounding or making any arrangement with its creditors or having a receiver appointed over all or any part of its assets or going into liquidation (whether voluntary or otherwise) save as part of a bona fide reconstruction not involving insolvency or shall take or suffer to be taken any similar action as a result of its liability to pay its debts or its insolvency, then:

 

8.4.1                     the Manufacturing Know How shall be immediately released to Bayer;

 

8.4.2                     Bayer shall be granted a non-exclusive, royalty free, sub-licensable, irrevocable licence to use the Manufacturing Know How (as updated from time to time) to Manufacture or to have Manufactured the Product;

 

8.4.3                     GW shall in accordance with legislative and regulatory requirements transfer to Bayer or its nominee ownership of the Marketing Authorisation in the Territory. In the event that such transfer is not possible GW shall use reasonable endeavours to ensure that Bayer has the benefit of the Marketing

 


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Authorisation, and, to this end, consents to any Governmental Authority cross-referencing the data and information on file with any Governmental Authority as may be necessary to facilitate the granting to Bayer of second marketing authorisations in respect of the Product in the Territory; and

 

8.4.4                     GW agrees to complete whatever other procedures are reasonably necessary in relation to the same to enable Bayer (either itself or in conjunction with a third party) freely to Manufacture and sell the Product in the Territory. For this purpose, GW shall execute and deliver to Bayer on the Effective Date a power of attorney in the form attached hereto in Appendix 4. Bayer undertakes only to complete and use such power of attorney in the circumstances, if (a) Bayer notified GW in writing of such intended use of the power of attorney, and (b) GW did not provide the reasonably requested support promptly after receipt of such request, and (c) Bayer attempted to discuss and negotiate with GW in good faith a timely resolution, provided that such negotiation period shall not exceed ten (10) business days and, if longer, the period Bayer can reasonably wait until use of the power of attorney is required.

 

9.                                      QUALITY OF PRODUCTS

 

9.1.                            GW shall ensure that each Delivery of the Products supplied to Bayer hereunder is accompanied by a Certificate of Analysis. The Products will be supplied in accordance with the requirements of the Quality Agreement between GW and Bayer and in compliance with the agreed Specifications and Acceptable Quality Levels (AQLs) detailed therein. Bayer shall notify GW of any visually apparent defects in any quantity of the Products Delivered to it within eight (8) business days of the date of Delivery to Bayer’s premises. Within eight (8) business days of receipt of the Products from GW ordered pursuant to this Agreement, Bayer shall have the right but not the obligation, to analyse or cause to be analysed, any shipment of the Products. If in Bayer’s reasonable opinion such analysis reveals any defects in such shipment by reference to the Specifications, Bayer shall immediately notify GW in writing thereof and send samples of that shipment to GW.

 

9.2.                            Bayer shall notify GW in writing within thirty (30) business days of its visual inspection (or within five (5) business days of becoming aware of any Latent Defects) of any complaints or issues arising as to the quality of the Products and send a sample of the defective Product(s) to GW. Additionally if a potential defect may constitute a hazard to patient safety such reporting should be within twenty four (24) hours of Bayer becoming aware of such defect, initially by telephone and promptly followed up in writing.

 

9.3.                            If GW is satisfied and has agreed that the relevant shipment of the Products is defective due to GW’s default, Bayer shall dispose of such defective shipment of the Products as GW shall direct in writing and at GW’s reasonable expense and GW shall use its reasonable efforts to supply new Products to Bayer as soon as reasonably possible thereafter PROVIDED THAT if the Parties fail to agree whether the shipment is defective or, if defective whether the defect is due to GW’s default, the matter shall be referred to the Laboratory to be tested in the presence of representatives of both the Parties within fourteen (14) days to determine whether the shipment complies with the Specifications. The costs of such testing shall be borne by GW in the event it is established by the Laboratory that the Products fail to comply with the Specifications. In circumstances where it is established by the Laboratory that the Products are within the Specifications Bayer shall bear the costs of such testing. If, notwithstanding the foregoing provision, GW has invoiced Bayer in respect of such Products GW shall credit BAYER with the value of such invoiced Products if the Products fail to comply with the Specifications. Pending the outcome of any such dispute, GW shall use its reasonable efforts to ensure that Bayer remains in stock of the Products.

 

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9.4.                            Subject to Clause 9.2, in the absence of any notification in writing to the contrary by Bayer within twenty (20) business days of receipt of the Products by Bayer the Products shall be deemed to have been accepted by Bayer.

 

9.5.                            GW shall provide a reasonable volume of samples of the Products to Bayer for quality assurance purposes on a free of charge basis.

 

10.                               SUPPLY AND STORAGE OF MATERIALS AND PRODUCTS

 

10.1.                     GW shall be solely responsible for ordering the required quantities of Intermediates. GW shall purchase and use only Intermediates and use such procedures in the Manufacture of the Products, which comply with the requirements of the Marketing Authorisations and with Good Manufacturing Practice and where such Intermediates otherwise are fit for purpose. GW shall at all times ensure that all Intermediates and Products Manufactured by GW pursuant to this Agreement are stored and warehoused in compliance with the Manufacturing Licence and otherwise in accordance with Bayer’s reasonable written requirements. GW shall operate a warehousing system which identifies all the Products according to type and status. GW shall comply with any reasonable written requirements of Bayer or a Governmental Authority relating to the security of controlled drugs and cold storage.

 

10.2.                     GW shall be responsible for ensuring that where Manufacture is contracted out to Authorised Contractors, such Authorised Contractors comply with the requirements of Clause 10.1 above.

 

10.3.                     Bayer or its Affiliates shall comply with the requirements of the Manufacturing Licence or any Wholesale Dealers Licence(s), GMP and otherwise in accordance with GW’s reasonable written requirements in respect of the storage and warehousing of the Products. Bayer shall comply with any reasonable written requirements of GW or a Governmental Authority relating to the security of controlled drugs and cold storage.

 

10.4.                     Bayer shall be responsible for ensuring that, where warehousing, transport, storage and distribution is contracted out, its contractors will comply with the requirements of Clause 10.3 above.

 

11.                               MARKETING AUTHORISATIONS

 

11.1.                    GW undertakes to observe and comply with all requirements of the valid Marketing Authorisations and any amendments or additions thereto in so far as they apply to the Manufacture of the Products hereunder and have been disclosed by GW to Bayer or its Affiliates in writing.

 

11.2.                    GW undertakes to inform Bayer or its Affiliates of any amendments or additions to the Marketing Authorisations which are relevant to the performance by Bayer of its obligations under this Agreement at which time the Agreement shall be amended in accordance with the amendments or additions implemented by GW in the Manufacture of the Products to the extent required.

 

12.                               MANUFACTURE OF PRODUCTS

 

12.1.                     GW shall at its own cost obtain and throughout the term of this Agreement maintain all necessary Manufacturing Licences or procure that Manufacturing Licences are maintained by the Authorised Contractors and perform its, or procure the performance by the Authorised Contractors of their, obligations hereunder in accordance with the Manufacturing Licences and all applicable laws and legislation in the Territory. GW shall supply a copy of each such Manufacturing Licence to Bayer or its Affiliates free of charge on written request.

 

12.2.                     All personnel employed by GW or the Authorised Contractors in the Manufacture of the Products shall be suitably trained, experienced and competent for their respective functions with particular reference to performing their assigned duties in accordance

 

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with Good Manufacturing Practice. GW shall, or shall procure that the Authorised Contractors shall, keep written records of the training provided to such employees, copies of which shall be made available to Bayer on request.

 

12.3.                     GW covenants with Bayer not at any time during the term of this Agreement to carry out any other activities that may, to GW’s knowledge at the time of the said activity, prejudice the quality, safety or efficacy of the Products.

 

13.                              LABELLING AND ARTWORK

 

13.1.                     GW shall Manufacture the Products incorporating such design, Trade Mark and artwork as may be agreed in writing from time to time between the Parties.

 

13.2.                     GW shall bear the initial costs in respect of preparation of artwork and labels for the Products for Launch in the UK. Bayer shall bear any subsequent costs for changes to artwork or labelling requested by Bayer during the term of this Agreement. Bayer shall bear the write-off costs in respect of packaging components, resulting from artwork or labelling changes requested by Bayer, provided that the volume of such components is no greater than that required to fulfil Bayer’s then forecast Firm and Semi-Firm requirements for the affected Products.

 

13.3.                     GW shall bear the artwork and labelling costs arising from any artwork and labelling changes instigated by the Governmental Authority or arising for regulatory reasons implemented by GW as holder of a Marketing Authorisation.

 

13.4.                     Save as required by any applicable law or regulation and as provided for by Clause 11.2 of the Licence and Distribution Agreement, GW will not affix to any of the Products any trade mark (other than the Trade Mark unless otherwise agreed by GW and Bayer), business names, labels or signs other than as may previously have been approved in writing by Bayer (Bayer’s agreement not to be unreasonably withheld or delayed).

 

13.5.                     Save as required by any applicable law or regulation, GW shall not make any change to the layout, content or appearance of any labelling of any of the Products without the prior written consent of Bayer (Bayer’s agreement not to be unreasonably withheld or delayed).

 

14.                              HAZARDS

 

GW will inform and keep Bayer informed of all hazards, regulations and guidance (statutory or otherwise) which GW knows or believes to be associated with the use, handling, storage labelling, transport, treatment and disposal of the Products and GW will ensure that relevant consignments are safe, packaged, labelled so as to prevent any health risk to persons, property or the environment and properly marked with the appropriate internationally recognised danger symbols and that prominent hazard warnings appear on all packages and documents.

 

15.          WARRANTIES AND INDEMNITY

 

15.1.       GW hereby represents and warrants that:

 

(a)                                 the Products supplied hereunder shall conform to the Specifications; and

 

(b)                                 the Products shall be Manufactured in accordance with Good Manufacturing Practice and the processes set out in this Agreement;

 

(c)                                  it will convey good title to the Products supplied hereunder and that the Products will be delivered free from any lawful security, interest, lien or encumbrance.

 

15.2.                    Bayer hereby represents and warrants that the Products shall be stored and distributed in accordance with GDP and the processes set out in this Agreement.

 

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16.          DURATION AND TERMINATION

 

16.1.                    This Agreement shall continue for fifteen (15) years (“Initial Term”), unless (a) the License and Distribution Agreement is terminated earlier in which case this Agreement shall also terminate or (b) earlier terminated in accordance with this Clause 16. This Agreement shall continue for successive twelve (12) month periods thereafter unless Bayer terminates by serving at least twelve (12) months’ written notice prior to the end of the Initial Term and prior to the end of each successive calendar year after such Initial Term.

 

16.2.                    Notwithstanding Clause 16.1, the obligation of Bayer according to Appendix 5 to purchase its entire requirement of Product from GW shall only apply for a period of *** (***) years from Launch of the Products in the Territory.

 

During the Initial Term, the following shall apply: Upon written request of GW of not less than *** (***) months prior to the end of such period, the Parties shall meet and discuss whether Bayer in its sole discretion wants to agree on a renewal for a period of further *** (***) years on the same terms set forth above. Should Bayer agree to such renewal, the Parties shall agree on forecast for sales which shall form the basis for the calculation of the supply prices, as set out in Appendix 1. Should Bayer not agree to such renewal in writing within *** (***) months following receipt of the request by GW, GW has the right but not the obligation to terminate this Agreement and the Licence and Distribution Agreement with a eleven (11) month written notice to be provided prior to the expiration of the respective *** (***) year term. For the avoidance of doubt, in the event that GW does not request a meeting in writing prior to the said *** (***) month period or does not provide the said eleven (11) months’ written notice, the provisions contained in this Agreement relating to the obligation of Bayer to purchase the entire requirement of Product and the right of GW to terminate the Agreement shall be deemed to be deleted after expiry of the said *** (***) year period and the Agreement shall continue thereafter in accordance with all remaining terms.

 

16.3.                    If either party to this Agreement shall commit any material breach excluding failure to supply or delayed in Delivery of this Agreement and not remedy the breach within sixty (60) days of notice from the other Party so to do (if capable of remedy) the other Party may terminate this Agreement immediately by notice in writing to the Party in breach.

 

16.4.                    If either Party shall compound or make any arrangement with its creditors or have a receiver appointed over all or any part of its assets or go into liquidation (whether voluntary or otherwise) save as part of a bona fide reconstruction not involving insolvency or shall take or suffer to be taken any similar action as a result of its liability to pay its debts or its insolvency it shall promptly so notify the other Party in writing giving particulars of the circumstances whereupon the other Party may terminate the Agreement immediately by notice (for the avoidance of doubt, Bayer may terminate the Agreement upon the occurrence of any of the circumstances described in this Clause 16.4 notwithstanding that GW may not have given notice to Bayer as required).

 

16.5.                    If Bayer ceases to sell the Products for a significant technical or regulatory reason (and a significant technical or regulatory reason for these purposes is agreed to include, without limitation, any adverse technical or regulatory impact for Bayer that is or may be attributable in whole or in significant part to the use by Bayer of the Product(s)) either Party may terminate this Agreement on giving six (6) months’ notice

 


***         Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

15



 

provided, however, that the Party learning of such technical or regulatory impact shall immediately notify the other of the same, and, as appropriate, work together diligently and in good faith to remedy such impact during the notice period or such other period as the Parties shall agree in writing.

 

17.                              CONSEQUENCES OF TERMINATION

 

17.1.                    On termination of the Agreement GW shall, not later than seven (7) days after Bayer’s request but at Bayer’s cost:

 

(a)                                 Bayer shall notify GW of the amount of the Products in its possession and Bayer shall be permitted to sell those amounts of the Products for a period of up to one hundred (180) days after termination provided that Bayer shall pay the payments thereon at the time provided herein;

 

(b)                                 each Party to return to the other Party all other documents provided to it, other than those documents provided as part of the Manufacturing Information if Bayer has assumed its rights to Manufacture under Clause 8.2.5;

 

(c)                                  ensure that all copies (save one (1) for the purposes of demonstrating compliance with this Agreement) of Confidential Information, know-how and/or any information of a technical nature relating to the Products and the Manufacture of the Products or of a confidential nature and supplied by one Party to the other is returned or destroyed by GW at Bayer’s option or Bayer at GW’s option; and

 

(d)                                 Bayer shall pay all sums due to GW under any invoices provided by GW in respect of supply of the Products hereunder.

 

17.2.                    On termination of the Agreement Bayer shall, not later than seven (7) days after GW’s request return to GW all other documents provided to Bayer by GW; with the exception of any records required to be kept for the purposes of complying with GMP.

 

17.3.                    Termination of this Agreement or withdrawal of any of the Products from the Agreement shall be without prejudice to the continuation in force of Clauses 7 of this Agreement and Clauses 8 and 17 of the License and Distribution Agreement and any other obligations otherwise provided by this Agreement which have accrued. In addition, any other provision required to interpret and enforce the Parties’ rights and obligations under this Agreement shall also survive, but only to the extent required for the full observation and performance of this Agreement. Furthermore, GW agrees to provide Bayer with all reasonable support with respect to any investigation reasonably required by Bayer or any Governmental Authority with respect to Manufacture of the Products carried out prior to such termination or withdrawal even after such termination or withdrawal provided that GW’s reasonable costs in providing such assistance shall be at Bayer’s cost unless the Agreement has been terminated by Bayer for a reason contained in Clause 17.2 above.

 

17.4.                    Termination or expiry of this Agreement shall not release either Party hereto from any liability or right of action which at the time of termination has already accrued to either Party hereto or which may thereafter accrue in respect of any act or omission prior to such termination. Such rights shall include but not be limited to the recovery of any monies due hereunder.

 

18.          AUTHORISED CONTRACTORS

 

18.1.                    As at the Effective Date, GW has appointed and executed binding agreements with Authorised Contractors to carry out its obligations under this Agreement.

 

18.2.                    Notwithstanding Clause 10.2 above, GW shall remain liable to Bayer for the performance of all its obligations and shall ensure that the contracts between GW and such Authorised Contractor comply with and reflect the provisions of this Agreement.

 

16



 

In particular, such contracts shall contain (a) a Quality Agreement, (b) the prior written approval of Authorised Contractors in respect of the assignment of the contracts to Bayer under Clause 8.2.5 above and (c) a satisfactory level of protection in the event an Authorised Contractor compounds or makes an arrangement with its creditors or has a receiver appointed over all or any part of its assets or goes into liquidation (whether voluntary or otherwise) save as part of a bona fide reconstruction not involving insolvency or shall take or suffer to be taken any similar action as a result of its liability to pay its debts or its insolvency during the term of this Agreement, including, but not limited, to GW’s first right to acquire all or any of the facilities, equipment, materials and other assets and consumables used by Authorised Contractor in the performance of services relating to Products. It is understood by Bayer that such protection is always at the discretion of the administrator or receiver of the Authorised Contractor.

 

18.3                       GW shall not without the prior written consent of Bayer (which shall not be unreasonably withheld or delayed) appoint any other contractor during the term of this Agreement to carry out its obligations hereunder. Clauses 18.1 and 18.2 shall apply accordingly.

 

19.          REFERENCE

 

Clauses 8 and 15 to 24 of the License and Distribution Agreement shall also apply to this Supply Agreement.

 

IN WITNESS WHEREOF, the Parties, through their authorised officers, have executed this Agreement as of the date first written above.

 

 

Signed for and on behalf of

 

Signed for and on behalf of

BAYER AG

 

GW PHARMA LIMITED

 

 

 

 

 

 

Leverkusen, 20 May 2003

 

Salisbury, 20 May 2003

 

 

 

 

 

 

/s/ Dr. Dietrich Brocks

 

/s/ Justin Gover

Dr. Dietrich Brocks

 

Justin Gover

Head of International Cooperations

 

Managing Director

and Licensing Europe

 

 

 

 

 

 

 

 

/s/ Dr. Dirk Ehle

 

/s/ David Kirk

Dr. Dirk Ehle

 

David Kirk

Law and Patents

 

Finance Director

 

17



 

APPENDIX 1

 

THE SUPPLY PRICES

 

For Net Sales in each Commercial Year the Supply Prices are to be calculated as *** percent (***%) of Net Selling Price. For Net Sales in each Commercial Year above *** percent (***%) of the Net Sales forecasts below for that Commercial Year, *** percent (*** %) of the Net Selling Price shall be added to the Supply Price for the incremental quantity (for the avoidance of doubt, in respect of such incremental sales, the Supply Price is *** percent (***%) of the Net Selling Price). Upon submission to the Medicinal Products Regulatory Authority to include the indication relief of cancer pain to the Indications the parties shall agree to an increased Net Sales Forecast to reflect the Net Sales for all Indications.

 

A. United Kingdom

 

Sales in the Territory of the Products

 

Commercial Year

 

Net Sales in  £’000

 

1

 

***

 

2

 

***

 

3

 

***

 

4

 

***

 

5

 

***

 

6

 

***

 

7

 

***

 

8

 

***

 

9

 

***

 

10

 

***

 

 

B.

 

Agreed Net Sales forecasts for other Countries to be added to this Appendix in accordance with Clause 3 of the Licence and Distribution Agreement.

 


***         Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

18



 

C.

 

In the event *** within *** (understood as *** (***) month period) fall beneath the following percentages of *** Bayer shall receive from GW *** (“***”) according to the table below. Such *** shall be calculated as a percentage of Products sold by *** in each Country during the previous ***.

 

Bayer Sales as a percentage of IMS Sales

 

Percentage of Bayer Sales as free goods

 

***

%

***

%

***

%

***

%

***

%

***

%

***

%

***

%

***

%

***

%

***

 

***

%

 

The *** shall be delivered within *** scheduled according to Appendix 5 following the reconciliation.

 


***         Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

19



 

APPENDIX 2

 

DRAFT SPECIFICATIONS OF PRODUCTS

 

Test

 

Test Method

 

Limits

 

 

 

 

 

 

 

***

 

***

 

***

 

***

 

***

 

***

***

 

***

 

***

 

***

 

***

- ***

- ***

 

***

***

 

***

***

 

***

- ***

- ***

 

***

 

***

***

 

***:

- ***

- ***

 

***

***

 

***

***

 

***:

 

***

 

***

 

 

The drug product is a solution containing THC and CBD botanical extracts.  The specification for the control of 27mg/ml THC and 25mg/ml CBD BDP has been provided.

 

Please note:

 

The *** specification stated above is the proposed specification for commercial release of the finished product. *** has been provided to show compliance with the existing in-house ***. The specification for *** has been extended significantly as a result of the availability of additional *** that allow the identification of ***                          .

 

Analytical Procedures: The analytical procedures used in the control of *** are in-house methods.

 

In-house methods:

 

·                  ***

·                  ***

·                  ***

·                  ***

·                  ***

 


***         Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

20


 

APPENDIX 3

 

QUALITY AGREEMENT

 

 

- to be attached -

 

21



 

APPENDIX 4

 

POWER OF ATTORNEY

 

THIS DEED is made on 20 May 2003 by GW Pharma Limited whose registered office is at Porton Down Science Park, Salisbury, Wiltshire SP4 0JQ (“GW”)

 

WHEREAS, GW has become a party to an agreement of even date herewith with Bayer AG (the “Agreement”) in relation to the supply of a medicinal product and is obliged, inter alia, pursuant to Clause 8.4.4 thereof to deliver to Bayer AG a power of attorney in the form of this Deed.

 

NOW THIS DEED WITNESSES AS FOLLOWS:

 

1.                                               Appointment of Attorney

 

GW hereby irrevocably and unconditionally (and by way of security of the performance of its obligations under the Agreement) appoints Bayer AG as its attorney (the “Attorney”) to execute and do in its name or otherwise and on its behalf all documents, acts and things which the Attorney shall in its absolute discretion consider necessary or desirable in order to implement GW’s obligations under clause 8.4 of the Agreement.

 

2.                                               Ratification

 

GW undertakes to ratify whatever Bayer AG, as its Attorney, shall lawfully do or cause to be done in accordance with this Power of Attorney.

 

3.                                               Governing Law

 

This Deed shall be governed and construed in accordance with the laws of England.

 

IN WITNESS whereof GW Pharma Limited has executed this Deed the day and year first before written.

 

EXECUTED as a Deed by GW Pharma Limited

 

 

 

Acting by

 

 

Director

 

 

 

 

 

Director/Secretary

 

22



 

APPENDIX 5

 

ORDERS FOR PRODUCTS

 

The following provisions apply under the provisions of Clause 3 in relation to the following countries of the Territory:

 

PART A

 

UK Territory

 

1.                                     Bayer or its Affiliate shall provide to GW by the first Day of each month with a forecast APPENDIX of demand for the Products for each Country for at least the following eighteen (18) months (“Forecast APPENDIX”). The Forecast APPENDIX shall be updated monthly. In addition and subject to Clauses 2 — 7 below, Bayer shall provide GW during the fourth (4th) quarter of each calendar year with an annual forecast for the following calendar year which shall serve as a basis for the ordering system and shall not contain binding orders but quantities corresponding to the first twelve (12) months of the Forecast APPENDIX. Against this annual forecast Bayer will formally call off the respective quantities.

 

2.                                     The quantities of the Products detailed in the first *** (***) months of each Forecast APPENDIX (“Firm Order Period”) shall (to the extent set out in Appendix 5) constitute a binding commitment on Bayer in relation to each Country to purchase such quantities of the Products from GW on the terms and conditions of this Agreement (“Firm Order”). With respect to each Country Bayer shall issue to GW a Firm Order for the quantity of the Products ordered for the Firm Order Period not later than *** (***) weeks prior to the Delivery date specified therein. The Firm Order shall specify the arrangements for Delivery of the Products. The Parties agree that all Firm Orders for the Products placed by BAYER with GW under this Agreement shall be supplied on the terms of this Agreement.

 

3.                                     In determining Firm Order quantities for each Country Bayer shall take account of Manufacturing batch sizes, such that Bayer must accept as fulfilled orders actual quantities of Products Manufactured which are within a margin of *** (***) percent of the Firm Order quantity. In the event GW supplies quantities in an aggregated shortfall of more than *** (***) percent, then GW shall be obliged to make up such shortfall quantities as early as possible. The initial Manufacturing batch sizes for the Products shall be *** and *** and any variance to this quantity shall be notified by GW to Bayer in writing.

 

4.                                     The volumes detailed in the next *** (***) months after the Firm Order Period of the Forecast APPENDIX (the “Semi-Firm Order Period”, being months ***) shall represent a semi-firm order for each Country, meaning that Bayer shall be obliged to order and purchase at least ***% of the initial forecast for any month *** forecast. For the avoidance of doubt the initial forecast for any month *** forecast may not vary by more than thirty percent by the time that forecast becomes a Firm Order. GW shall hold sufficient stocks of intermediates to meet the forecast requirements during the Firm Order Period and up to *** percent (***%) of the forecast requirements detailed in the Semi-Firm Order Period. Both Parties shall conduct their businesses so as to

 


***         Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

23



 

minimise any stock write-offs. Bayer may ask GW for additional quantities to be manufactured and delivered by GW. GW shall use its reasonable efforts to comply with Bayer’s additional demand. In any case GW shall give notice to Bayer within ten (10) business days of the receipt of the written order of its ability to meet the additional quantity.

 

5.                                     GW shall respond to each Firm Order received from Bayer within three (3) business days of receipt. The response shall include confirmation of the Delivery dates and quantity as set out in the Firm Order. In the event that discussion is required regarding the timings of production and Delivery then the relevant planning personnel from both Parties will negotiate in good faith and agree and confirm in writing an amended Forecast APPENDIX within four (4) business days of receipt by GW of the original Forecast APPENDIX except during the period 20th December to 6th January in each year when the periods of three (3) or four (4) business days referred to herein shall be replaced by eight (8) business days in each case.

 

6.                                     It is understood that volumes detailed in relation to the remaining *** (***) months of the Forecast APPENDIX after the Firm Order Period and the Semi-Order Period constitute an estimate of the future Product requirement of Bayer and its Affiliates for each Country within the Territory and do not comprise any minimum purchase requirement or any binding commitment by Bayer or its Affiliates to purchase such volume of the Products.

 

7.                                     Binding orders subject to approval in the Territory for Bayer’s requirements of Launch Stocks shall be provided by Bayer for the UK within ten (10) business days of the Effective Date. The delivery date shall be agreed by the UK Country Commercialization Committee. Bayer shall notify GW in writing of the Delivery date for the Launch Stocks at least ten (10) weeks before due delivery date specified for Launch.

 

PART B

 

...

 


***         Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

24



 

APPENDIX 6

 

DELIVERY OF PRODUCTS

 

The following provisions apply under the provisions of Clause 4 in relation to the following countries of the Territory:

 

PART A

 

UK Territory

 

1.                                      GW shall procure that the Products Manufactured hereunder are Delivered in each Country in accordance with the provisions of this Agreement. The costs of Delivery of the Products from GW or the premises of its Authorised Contractor as appropriate to Bayer’s nominated distribution centre or other nominated location in the Country in question shall be borne by Bayer.

 

2.                                      With respect to Launch Stocks and for all the Products Manufactured with a maximum permitted shelf life of twelve (12) months, there shall be a minimum of ten (10) months’ shelf life remaining on the Products at the date of Delivery requested by Bayer on each Bayer order. In the case of any of the Products with less than ten (10) months’ shelf life, the Products shall be returned to GW at GW’s reasonable cost and replaced with Product having the required shelf-life at no cost to Bayer, unless Bayer accepts these Products for sale.

 

3.                                      In the event that the shelf-life permitted by a Governmental Authority applicable to a Country is extended beyond twelve (12) months or to any other period the Parties shall negotiate in good faith and agree in writing the revised shelf life remaining on the Products upon Delivery to Bayer and the date upon which the first Delivery shall be made of the Products with such extended shelf-life PROVIDED ALWAYS THAT at the date of Delivery requested by Bayer on each Bayer order the shelf life remaining on the Products at the date of Delivery shall be at least *** percent (***%) of the total shelf life available for the Products or *** months. In the event that the said Governmental Authority approves an extension to the shelf-life beyond twelve (12) months or approval for the 14 ml vial (gross) size, the Parties shall develop an implementation and transition plan to minimise write-off costs for the 8 ml gross vial and to ensure minimum disruption to patients and any write-offs costs shall be shared equally. Bayer shall undertake to launch the 14 ml gross vial for the Products, upon agreement as to the transitional arrangements, and subject to approval by the Governmental Authority and availability of stocks of the Products from GW to satisfy Bayer’s Firm Order requirements.

 

4.                                      In the event of a delay caused by the acts or omissions of a Governmental Authority in a Country resulting in a delayed Launch beyond the Launch date to be agreed between the parties in writing and Bayer is not able to sell such part or all of the Launch Stocks, the Parties shall equally share GW’s write-off costs of the destruction of any Launch Stocks of the Products calculated in accordance with Appendix 5. GW shall provide replacement stocks in respect of any destroyed Launch Stocks as soon

 


***         Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

25



 

as is reasonably practicable. If GW has invoiced Bayer with any proportion of such destroyed Launch Stocks GW shall credit Bayer with the invoiced value of that proportion of the Launch Stocks.

 

5.                                      In the event that GW fails to deliver in response to the Firm Orders for the Products for a Country on the specified Delivery date by reason of delay, GW shall provide a revised Delivery date. In the event that Delivery is more than ten (10) business days later than the original specified Delivery date, GW shall provide to BAYER an action plan to achieve the revised Delivery date. In circumstances where Delivery has not been achieved within twenty (20) business days from the original Delivery date and Bayer is able to demonstrate that it has thereby suffered a material stock shortage of the Products at its nominated distribution centre ***


                        :

 

***

 

***

 

 

 

***

 

***

 

 

 

***

 

***

 

 

 

***

 

***

 

For the avoidance of doubt the above discount rates shall not be applicable if the shortage of the Products is due to demand in excess of the Firm Orders or Semi-Firm Orders as the case may be.

 

PART B

 

...

 


***         Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

26




Exhibit 10.8

 

***Text Omitted and Filed Separately with the Securities and Exchange Commission.

Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406

 

AMENDMENT NUMBER 1

 

TO THE SUPPLY AGREEMENT

 

between GW PHARMA LIMITED (“GW”) having its registered office at Porton Down Science Park, Salisbury, Wiltshire SP4 0JQ and BAYER HEALTHCARE AG, Division Pharma, having its registered office at Bayerwerk, 51368 Leverkusen, Germany (“Bayer”)

 

WHEREAS, Bayer AG and GW executed a Supply Agreement as of the 20th day of May 2003;

 

WHEREAS, Bayer AG transferred its entire healthcare business including all contractual rights and obligations to its 100% subsidiary Bayer HealthCare AG with effect of October 1, 2003, as permitted in accordance with. Clause 19 of the Supply Agreement and Clause 22.2 of the License and Distribution Agreement;

 

WHEREAS, Bayer decided to exercise its option under clause 3.1 of the License and Distribution Agreement for Canada;

 

WHEREAS, the Parties wish to agree upon the Supply Prices for Canada;

 

WHEREAS, in accordance with Clauses 3.2 and 4 of the Supply Agreement, the Parties will negotiate in good faith the provisions relating to orders for Products applicable to Canada as well as provisions relating to Delivery of Products applicable to Canada.

 

NOW, THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:

 

1.                                      Appendix 1, Part B, for Canada is completed in the form attached to this Amendment.

 

2.                                      This Amendment shall be executed in two counterparts, but shall not be effective until each party has executed at least one counterpart. Each counterpart shall constitute an original of this Amendment, but all counterparts shall together constitute but one and the same instrument.

 

IN WITNESS WHEREOF, the Parties, through their authorised officers, have executed this Agreement as of the date first written above.

 

Signed for and on behalf of
BAYER HEALTHCARE AG

Signed for and on behalf of
GW PHARMA LIMITED

 

 

Leverkusen, 4th November 2003

Salisbury, 4th November 2003

 

 

/s/ ppa. D. Brocks

 

/s/ Justin Gover

Dr. Dietrich Brooks
Head of International Cooperations
and Licensing Europe

Justin Gover
Managing Director

 

 

/s/ ppa Alexander Bey

 

/s/ David Kirk

Dr. Alexander Bey
Law and Patents

David Kirk
Finance Director

 



 

APPENDIX 1.B. for Canada

 

THE SUPPLY PRICES

 

In the event that only Milestone 1 or Milestone 3 as specified in Appendix 3 of the License and Distribution Agreement as amended for Canada by Amendment Number 1 has been achieved, for Net Sales in each Commercial Year, the Supply Prices are to be calculated as *** percent (***%) of Net Selling Price.

 

Immediately upon achievement of any additional Milestone listed in Appendix 3 of the License and Distribution Agreement as amended for Canada by Amendment Number 1, for Net Sales in each Commercial Year up to *** percent (*** %) of the Net Sales forecasts below, the Supply Prices are to be calculated as *** percent (*** %) of Net Selling Price. For Net Sales in each Commercial Year above ***  percent (*** %) and up to *** percent (*** %) of the Net Sales forecasts below for that Commercial Year, *** percent (***  %) of the Net Selling Price shall be added to the Supply Price for the incremental Net Sales (for the avoidance of doubt, in respect of such incremental Net Sales, the Supply Price is *** percent (*** %) of the Net Selling Price). In respect of Net Sales in each Commercial Year above *** percent (*** %) of the Net Sales forecasts below for that Commercial Year, another *** percent (*** %) of the Net Selling Price shall be added to the Supply Price for the incremental Net Sales (for the avoidance of doubt, in respect of such incremental sales, the Supply Price is *** percent (*** %) of the Net Selling Price); provided, however, that BAYER is not entitled to a Supply Price of *** percent (*** %) according to Appendix 3, number 6 of the License and Distribution Agreement as amended for Canada by Amendment Number 1.

 

B. Canada

 

Sales in Canada of the Products

 

***

 

***

 

 

 

 

 

***

 

***

 

 

 

 

 

***

 

***

 

 

 

 

 

***

 

***

 

 

 

 

 

***

 

***

 

 

 

 

 

***

 

***

 

 

 

 

 

***

 

***

 

 

 

 

 

***

 

***

 

 

 

 

 

***

 

***

 

 

 

 

 

***

 

***

 

 

 

 

 

***

 

***

 

 


***         Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 




Exhibit 10.9

 

***Text Omitted and Filed Separately with the Securities and Exchange Commission.

Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406

 

AMENDMENT NUMBER 2

 

TO THE SUPPLY AGREEMENT

 

between GW PHARMA LIMITED (“GW”) having its registered office at Porton Down Science Park, Salisbury, Wiltshire SP4 OJQ and BAYER HEALTHCARE AG, Division Pharma, having its registered office at Bayerwerk, 51368 Leverkusen, Germany (“Bayer”)

 

WHEREAS, Bayer and GW executed a Supply Agreement as of the 20th day of May 2003, as amended for Canada by Amendment Number 1 to the Supply Agreement and by Amendment Number 3 to the License and Distribution Agreement;

 

WHEREAS, Bayer and GW wish to amend the sales forecast for the UK Territory.

 

NOW, THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:

 

1.                                      Appendix 1, Part A shall be replaced by Appendix 1, Part A, as attached to this Amendment.

 

2.                                      This Amendment shall be executed in two counterparts, but shall not be effective until each party has executed at least one counterpart. Each counterpart shall constitute an original of this Amendment, but all counterparts shall together constitute but one and the same instrument.

 

IN WITNESS WHEREOF, the Parties, through their authorised officers, have executed this Agreement as of the date first written above.

 

Signed for and on behalf of

Signed for and on behalf of

 

 

BAYER HEALTHCARE AG

GW PHARMA LIMITED

 

 

Leverkusen, May 9, 2005

Salisbury, May 10, 2005

 

 

/s/ ppa. Dr. Horst Harenberg

 

/s/ Justin Gover

Dr. Horst Harenberg
Head of International Cooperations
and Licensing Europe

Justin Gover
Managing Director

 

 

/s/ ppa. Dr. Drk Ehle

 

/s/ David Kirk

Dr. Drk Ehle
Law and Patents

David Kirk
Finance Director

 



 

Appendix 1

 

A. United Kingdom

 

Sales in the Territory of the Products

 

Commercial Year

 

Net Sales in £‘000’s

 

 

 

 

 

***

 

***

 

 

 

 

 

***

 

***

 

 

 

 

 

***

 

***

 

 

 

 

 

***

 

***

 

 

 

 

 

***

 

***

 

 

 

 

 

***

 

***

 

 

 

 

 

***

 

***

 

 

 

 

 

***

 

***

 

 

 

 

 

***

 

***

 

 

 

 

 

***

 

***

 

 


***                           Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

2




Exhibit 10.10

 

***Text Omitted and Filed Separately with the Securities and Exchange Commission.

Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406

 

Amendment # 3

 

to the Supply Agreement by and between Bayer Schering Pharma AG (formerly “Bayer AG, Bayer HealthCare, Division Pharma”) and GW Pharma Limited dated May 20, 2003 — hereinafter referred to as “Supply Agreement” —

 

between                   Bayer Schering Pharma AG
Muellerstrasse 178
D-13353 Berlin
Germany
- hereinafter referred to as “BAYER” -

 

and                                           GW Pharma Limited
Porton Down Science Park
Salisbury, Wiltshire SP4 OJQ
- hereinafter referred to as “GW” -

 

WHEREAS, Bayer AG has transferred its Division Pharma to Bayer HealthCare AG following the execution of the Supply Agreement in 2003;

 

WHEREAS, Bayer HealthCare AG merged with BAYER effective as of December 30, 2008, with BAYER as the universal successor so that BAYER is the new contracting party to the Supply Agreement;

 

WHEREAS, BAYER and GW have entered into the Supply Agreement by which GW undertook to manufacture and supply all of BAYER’s requirements for Products (as defined in the Supply Agreement) to BAYER;

 

WHEREAS, BAYER and GW intend to amend the Supply Agreement in respect of the Supply Prices for the first Commercial Year and the Net Sales forecast as it is relevant for the calculation of the Supply Price.

 

NOW, THEREFORE, the PARTIES agree to the following:

 

1.       Unless otherwise defined in this Amendment # 3 all words written in capital letters shall bear the meaning as defined in the Supply Agreement.

 

2.       The following sentence shall be added to APPENDIX 1 paragraph 1 as the second-last sentence:

 

“Such *** percent (***%) shall not be added to the Supply Price in the first Commercial Year to the effect that the Supply Price shall be *** percent (***%) throughout the first Commercial Year.”

 

3.                      The table in APPENDIX 1 Section “A. United Kingdom” shall be deleted and replaced by the following table:

 


***                           Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

1



 

Commercial
Year

 

Net Sales
£’000s

 

*** Net
Sales

 

Supply
Price

 

Supply Price for Net
Sales above the ***

 

 

 

 

 

 

 

 

 

***

 

***

 

***

 

***

 

***

***

 

***

 

***

 

***

 

***

***

 

***

 

***

 

***

 

***

***

 

***

 

***

 

***

 

***

***

 

***

 

***

 

***

 

***

***

 

***

 

***

 

***

 

***

***

 

***

 

***

 

***

 

***

***

 

***

 

***

 

***

 

***

***

 

***

 

***

 

***

 

***

***

 

***

 

***

 

***

 

***

 

4.                      This Amendment # 3 shall form an integral part of the Supply Agreement and shall be regarded as incorporated into the Supply Agreement in every respect. All other terms and conditions of the Supply Agreement shall remain in force unchanged.

 

5.                      This Amendment # 3 shall take effect upon its execution.

 

6.                      In all other respects, the terms of the Supply Agreement shall remain unchanged.

 

This Amendment # 3 has been made in duplicate and signed by the PARTIES hereto.

 

Bayer Schering Pharma AG

Bayer Schering Pharma AG

 

 

/s/ i.v. Dr. Berthold Hinzen

 

/s/ i.v. Klaus Deimel 

5/3/2010                     

 

8/3/2010                                

Dr. Berthold Hinzen
Head Global Licensing General Medicine

Klaus Deimel
Head Business Development Region Europe

 

 

GW Pharma Limited

 

 

 

/s/ Justin Gover                               

 

/s/ David Kirk                                   

Name:        Justin Gover
Title:
                 Managing Director
Date:
               10 March 2010

Name:        David Kirk
Title:
                 Managing Director
Date:
               10 March 2010

 


***                           Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.

 

2




Exhibit 10.11

 

***Text Omitted and Filed Separately with the Securities and Exchange Commission.

Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406

 

Dated 6 June 2006


 

G W Pharma Limited

 

–  and

 

 

Almirall Prodesfarma, S.A.

 


 

PRODUCT COMMERCIALISATION AND SUPPLY CONSOLIDATED AGREEMENT

 


 

 

A MULTINATIONAL PARTNERSHIP

 

CityPoint, One Ropemaker Street | London EC2Y 9AW
Tel: +44 20 7920 4000 | Fax: +44 20 7496 8500

www.mofo.com

 



 

1.

DEFINITIONS

2

 

 

 

2.

PRINCIPAL RIGHTS

21

 

 

 

3.

MANAGEMENT OF THE RELATIONSHIP

21

 

 

 

4.

IMPLEMENTATION OF THE DEVELOPMENT PLAN AND LIFECYCLE MANAGEMENT PLAN

29

 

 

 

5.

COMMERCIALISATION

32

 

 

 

6.

MARKET STUDIES

40

 

 

 

7.

NEW INDICATIONS

41

 

 

 

8.

COMPASIONATE ACCESS PROGRAMS / NAMED PATIENT SALES / SUPPLY OF UNLICENSED SATIVEX

45

 

 

 

9.

GW PHARMA SUPPLY OBLIGATIONS

47

 

 

 

10.

FORECASTS ORDERS DELIVERY AND ACCEPTANCE

50

 

 

 

11.

PRICE AND PAYMENT TERMS

56

 

 

 

12.

PHARMACOVIGILANCE

65

 

 

 

13.

NON COMPETITION

67

 

 

 

14.

TRADE MARKS AND DOMAIN NAMES

67

 

 

 

15.

INTELLECTUAL PROPERTY - INITIAL FILINGS AND OWNERSHIP

71

 

 

 

16.

IP - MAINTENANCE PROSECUTION AND DEFENCE

71

 

 

 

17.

CONFIDENTIALITY AND NON-DISCLOSURE

75

 

 

 

18.

WARRANTIES AND UNDERTAKINGS

79

 

 

 

19.

INDEMNIFICATION AND INSURANCE

81

 

 

 

20.

TERMINATION

86

 

 

 

21.

CONSEQUENCES OF TERMINATION

88

 

 

 

22.

FORCE MAJEURE

90

 

 

 

23.

CHANGE OF CONTROL

91

 

 

 

24.

ASSIGNMENT

92

 

 

 

25.

GOVERNING LAW

92

 

 

 

26.

ARBITRATION

93

 

 

 

27.

NOTICES

93

 

 

 

28.

RELATIONSHIP OF THE PARTIES

94

 

 

 

29.

ENTIRE AGREEMENT AND SEVERABILITY

94

 

 

 

30.

ENGLISH LANGUAGE

95

 

 

 

31.

AMENDMENT