Nuvectis Pharma, Inc 10-Q for FY2026 Q3
Nuvectis Pharma, Inc. (NVCT)
About this 10-Q
Nuvectis Pharma, Inc filed this 10-Q on November 4, 2026, covering the quarter ended September 30, 2026 (FY2026 Q3).
Headline figures
Quarter ended September 30, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Net loss
- $30.07M
- compared with a net loss of $7.46M a year earlier
- Diluted EPS
- -$1.02
- compared with -$0.44 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
For the Quarterly Period Ended
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For the Transition Period from to .
Commission File Number
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Securities registered pursuant to Section 12(b) of the Act:
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:
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Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes
Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date.
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Class of Common Stock |
| Outstanding Shares as of October 30, 2026 |
Common Stock, $0.00001 par value |
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NUVECTIS PHARMA, INC.
FORM 10-Q
FOR THE QUARTER ENDED September 30, 2026
TABLE OF CONTENTS
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SUMMARY OF RISK FACTORS
An investment in our common stock is subject to a broad range of risks and should only be made after careful consideration of such risks. For a discussion of some of the risks you should consider before purchasing our common stock, you are urged to carefully review and consider the section entitled “Item 1A. Risk Factors.”
Our business is subject to a number of risks, including risks that may prevent us from achieving our business objectives or may adversely affect our business, financial condition, results of operations, cash flows, and prospects that you should consider before making a decision to invest in our common stock. These risks are discussed more fully in the section titled “Risk factors” beginning on page 26 of this report, and include the following:
Risks Related to our Financial Condition and Capital Requirements
| ● | We have a limited operating history, have only initiated a limited number of clinical trials, and have only a limited number of patients currently enrolled in our ongoing trials, and have not completed any pivotal trials to date. We do not have any products approved for commercial sale and have not generated any revenue, which may make it difficult for investors to evaluate our current business and likelihood of success and viability. |
| ● | We have incurred losses since our inception and have not generated any revenue. We expect to incur continued losses for the foreseeable future and may never achieve or maintain profitability. |
| ● | Our ability to generate revenue and achieve profitability depends significantly on our ability to achieve several objectives relating to the discovery or identification, preclinical and clinical development, regulatory approval, and commercialization of our current or future product candidates. |
| ● | Tariffs and other trade measures could adversely affect our business, results of operations, financial position, and cash flows. |
| ● | We will require substantial additional capital to finance our operations and achieve our goals. If we are unable to raise capital when needed or on terms acceptable to us, we may be forced to delay, reduce, or eliminate our research or product development programs, any future commercialization efforts, or other operations. |
Risks Related to the Development of our Product Candidates
| ● | We are substantially dependent on the success of our product candidates, NXP100, NXP200 and NXP900. |
| ● | Clinical trials are very expensive, time-consuming, and difficult to design and implement, and involve uncertain safety, tolerability, and efficacy outcomes. Furthermore, results of earlier preclinical studies and clinical trials may not be predictive of results of future preclinical studies or clinical trials. Our current or future product candidates may not have favorable results in early or later clinical trials, if any, or receive regulatory approval. |
| ● | If we fail to demonstrate safety and/or efficacy for any or all of our product candidates, we may need to terminate development programs, which may harm our reputation and the business. |
| ● | The development and commercialization of pharmaceutical products are subject to extensive regulation, and we may not obtain regulatory approvals for NXP100, NXP200 and NXP900 or any future product candidate. |
| ● | If we are unable to obtain or maintain regulatory approval for our product candidates and ultimately cannot commercialize one or more of them, or experience significant delays in doing so, our business will be materially harmed. |
Risks Related to Government Regulation
| ● | Denial of or delay in our receipt of required regulatory approvals may prevent or delay commercialization of our current or future product candidates, and our ability to generate revenue may be materially impaired. |
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| ● | Even if we receive regulatory approval of our current or future product candidates, we will be subject to ongoing regulatory obligations and continued regulatory review, which may result in significant additional expense, and we may be subject to penalties if we fail to comply with regulatory requirements or experience unanticipated problems with our current or future product candidates. |
| ● | Regulatory changes that make the development of drugs originating in China more difficult could adversely affect our development plans for NXP100 and NXP200. |
Risks Related to our Intellectual Property
| ● | If we are unable to obtain and maintain patent protection or other necessary rights for our products and technology, or if the scope of the patent protection obtained is not sufficiently broad or our rights under licensed patents are not sufficiently broad, our competitors could develop and commercialize products and technology similar or identical to ours, and our ability to successfully commercialize our products and technology may be adversely affected. |
Risks Related to our Reliance on Third Parties
| ● | The manufacturing of our current product candidates is complex. Our third-party manufacturers may encounter difficulties or interruptions for various reasons, which could delay or entirely halt their ability to manufacture any of our current or future product candidates for clinical trials or, if approved, for commercial sale. |
| ● | We plan to rely on third parties to conduct our preclinical studies and clinical trials. If these third parties do not properly and successfully carry out their contractual duties or meet expected deadlines, we may not be able to obtain regulatory approval of or commercialize our current or future product candidates. |
| ● | We are substantially dependent on our in-licensing partner for NXP100 and NXP200, Haisco, for the transfer of technology, know-how, and supply of certain materials to execute our plan for both NXP100 and NXP200. |
Risks Related to Managing Growth and Employee Matters
| ● | Our future success depends on our ability to retain our executive officers and key employees and to attract, retain, and motivate qualified personnel and manage our human capital. |
| ● | We currently have 19 full-time employees and will need to grow the size and capabilities of our organization. We may experience difficulties in managing this growth. |
Risks Related to Commercial Activities
| ● | If any of our current or future product candidates do not achieve broad market acceptance among physicians, patients, healthcare payors, and the medical community, the revenues from any such current or future product candidate may be limited. |
| ● | If product liability lawsuits are brought against us, we may incur substantial liabilities and may be required to limit commercialization of our current or future product candidates. |
Risks Related to Ownership of our Common Stock
| ● | We do not know whether an active, liquid, and orderly trading market will be maintained for our Common Stock or what the market price of our Common Stock will be, and, as a result, it may be difficult for you to sell your shares of our Common Stock. |
| ● | We do not intend to pay dividends on our Common Stock in the foreseeable future, so any returns will be limited to the value of our stock, which may be volatile. |
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PART I – FINANCIAL INFORMATION
Item 1. Financial Statements
NUVECTIS PHARMA, INC.
CONDENSED BALANCE SHEETS
(USD in thousands, except per share and share amounts)
(unaudited)
| | September 30, | | December 31, | ||
| | 2026 | | 2025 | ||
Assets |
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CURRENT ASSETS |
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Cash and cash equivalents |
| $ | |
| $ | |
Other current assets |
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TOTAL CURRENT ASSETS |
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TOTAL ASSETS |
| $ | |
| $ | |
| | | | | | |
Liabilities and Shareholders’ Equity |
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| | | | | | |
CURRENT LIABILITIES | | | | | | |
Accounts payable |
| $ | |
| $ | |
Accrued liabilities |
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Employee compensation and benefits |
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TOTAL CURRENT LIABILITIES |
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TOTAL LIABILITIES |
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COMMITMENTS AND CONTINGENCIES, see Note 3 |
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SHAREHOLDERS’ EQUITY, see Note 4 |
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Common Shares, $ | | |
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Additional paid in capital |
| | |
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Accumulated deficit |
| | ( |
| | ( |
TOTAL SHAREHOLDERS’ EQUITY |
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TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY |
| $ | |
| $ | |
* |
The accompanying notes are an integral part of these unaudited condensed financial statements.
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NUVECTIS PHARMA, INC.
CONDENSED STATEMENTS OF OPERATIONS
(USD in thousands, except per share and share amounts)
(unaudited)
| | | | | | | | | | | | |
| | Three Months Ended September 30 | | Nine Months Ended September 30 | ||||||||
| | 2026 | | 2025 | | 2026 | | 2025 | ||||
OPERATING EXPENSES |
| | | | | |
| | | | | |
Research and development |
| $ | |
| $ | |
| $ | |
| $ | |
General and administrative | | | |
| | | | | |
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|
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OPERATING LOSS |
| | ( |
| | ( |
| | ( |
| | ( |
Finance income | | | |
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NET LOSS |
| $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS | | $ | ( |
| $ | ( | | $ | ( |
| $ | ( |
EFFECT OF WARRANTS MODIFICATION | | | — | | | ( | | | — | | | ( |
TOTAL NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS | | $ | ( | | $ | ( | | $ | ( | | $ | ( |
BASIC AND DILUTED NET LOSS PER COMMON SHARE OUTSTANDING | | $ | ( |
| $ | ( | | $ | ( |
| $ | ( |
Basic and diluted weighted average number of common shares outstanding | | | |
| | | | | |
| | |
The accompanying notes are an integral part of these unaudited condensed financial statements.
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NUVECTIS PHARMA, INC.
CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
(USD in thousands, except share amounts)
(unaudited)
| | Common shares | | Additional | | | | | | Total | |||
| | $0.00001 Par Value | | Paid-In | | Accumulated | | | Shareholders’ | ||||
| | Shares |
| Amount | | Capital | | Deficit | | Equity | |||
BALANCES AT DECEMBER 31, 2024 |
| |
| * |
| $ | |
| $ | ( |
| $ | |
Share-based payments |
| — |
| — |
|
| |
| | — | | | |
Issuance of restricted share awards | | | | — | | | — | | | — | | | — |
Issuance of common shares, net of offering costs of $ | | | | * | | | | | | | | | |
Issuance of common shares, net of offering costs of $ | | | | * | | | | | | — | | | |
Net loss for the period |
| — |
| — |
| | - |
| | ( |
| | ( |
BALANCES AT MARCH 31, 2025 |
| |
| * |
| $ | |
| $ | ( |
| $ | |
Share-based payments | | — | | * | | | | | | — |
| | |
Issuance of restricted share awards | | | | * | | | — | | | — | | | — |
Issuance of common shares, net of offering costs of $ | | | | * | | | | | | — | | | |
Net loss for the period |
| — |
| — |
| | - |
| | ( |
| | ( |
BALANCES AT JUNE 30, 2025 |
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| * |
| $ | |
| $ | ( |
| $ | |
Share-based payments | | — |
| * | | | |
| | — | | | |
Issuance of restricted stock awards | | | | * | | | — | | | — |
| | — |
Issuance of common stock, net of offering costs of $ | | | | * | | | | | | — | | | |
Net loss for the period |
| — |
| — |
| | - |
| | ( |
| | ( |
BALANCES AT SEPTEMBER 30, 2025 |
| |
| * |
| $ | |
| $ | ( |
| $ | |
* | Represents an amount lower than $1 USD. |
The accompanying notes are an integral part of these unaudited condensed financial statements.
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NUVECTIS PHARMA, INC.
CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
(USD in thousands, except share amounts)
(unaudited)
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| | Common Shares | | Additional | | | | | Total | ||||
| | $0.00001 Par Value | | Paid-In | | Accumulated | | Shareholders’ | |||||
| | Shares | | Amount | | Capital | | Deficit | | Equity | |||
BALANCES AT DECEMBER 31, 2025 |
| |
| * | | $ | | | $ | ( | | $ | |
Share-based payments |
| — |
| — |
| | |
| | — |
| | |
Issuance of restricted share awards | | | | — | | | — | | | — | | | — |
Issuance of common shares, net of offering costs - At-the-market | | | | * | | | | | | — | | | |
Net loss for the period |
| — |
| — |
| | — |
| | ( |
| | ( |
BALANCES AT MARCH 31, 2026 |
| |
| * |
| $ | |
| $ | ( |
| $ | |
Share-based payments |
| — |
| * |
| | |
| | — | | | |
Issuance of restricted share awards | | | | * | | | — | | | — | | | — |
Issuance of common shares, net of offering costs of $ | | | | * | | | | | | — | | | |
Net loss for the period |
| — |
| — |
| | — |
| | ( |
| | ( |
BALANCES AT JUNE 30, 2026 |
| |
| * |
| $ | |
| $ | ( |
| $ | |
Share-based payments |
| — |
| * |
| | |
| | — |
| | |
Issuance of restricted share awards | | | | * | | | — | | | — | | | — |
Exercise of share warrants | | | | * | | | | | | — | | | |
Issuance of common shares, net of offering costs of $ | | | | * | | | | | | — | | | |
Issuance of common shares, net of offering costs of $ | | | | * | | | | | | | | | |
Net loss for the period |
| — |
| — |
| | — |
| | ( |
| | ( |
BALANCES AT SEPTEMBER 30, 2026 |
| |
| * |
| $ | |
| $ | ( |
| $ | |
* | Represents an amount lower than $1 USD. |
The accompanying notes are an integral part of these unaudited condensed financial statements.
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NUVECTIS PHARMA, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(USD in thousands, except per share and share amounts)
(unaudited)
| | Nine Months Ended September 30, | | ||||
| | 2026 | | 2025 | | ||
CASH FLOWS FROM OPERATING ACTIVITIES |
| | |
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|
Net loss |
| $ | ( |
| $ | ( |
|
Adjustments to reconcile loss to net cash used in operating activities: |
| | |
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|
Changes in operating assets and liabilities: |
| | |
| | |
|
Increase in other current assets |
| | ( |
| | ( |
|
(Decrease)/increase in accounts payable | | | ( | | | | |
Increase/(decrease) in accrued liabilities | | | | | | ( | |
Decrease in employee compensation and benefits |
| | ( |
| | ( |
|
Net cash used in operating activities |
| $ | ( |
| $ | ( |
|
CASH FLOWS FROM INVESTING ACTIVITIES |
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Net cash provided by (used in) investing activities |
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CASH FLOWS FROM FINANCING ACTIVITIES |
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Proceeds from issuance of common shares - At-the market offering |
| $ | |
| $ | |
|
Issuance costs related to At-the-market offering | | | ( | | | ( | |
Proceeds from exercise of warrants | | | | | | — | |
Proceeds from public offering | | | | | | | |
Issuance costs related to public offering | | | ( | | | ( | |
Net cash provided by financing activities |
| $ | |
| $ | |
|
INCREASE IN CASH AND CASH EQUIVALENTS |
| $ | |
| $ | |
|
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD |
| $ | |
| $ | |
|
CASH AND CASH EQUIVALENTS AT END OF PERIOD |
| $ | |
| $ | |
|
| | | | | | | |
Supplemental noncash disclosure of investing and financing activities: |
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| | |
|
Unpaid issuance costs related to ATM |
| | — |
| | | |
The accompanying notes are an integral part of these unaudited condensed financial statements.
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NUVECTIS PHARMA, INC.
Notes to the Unaudited Condensed Financial Statements
NOTE 1 – GENERAL:
| a. | Nuvectis Pharma, Inc. (hereafter – the “Company”) was incorporated under the laws of the State of Delaware on July 27, 2020, and commenced its principal operations in May 2021. The Company’s principal executive offices are located in Fort Lee, New Jersey. The Company’s shares are trading on the NASDAQ under the symbol “NVCT”. |
The Company is a biopharmaceutical company focused on the development of innovative precision medicines for the treatment of complement-related conditions and oncology.
| b. | In August 2021, the Company entered into a worldwide, exclusive license agreement with the University of Edinburgh, Scotland, for the Company’s drug candidate NXP900. In June 2026, the Company entered into a license agreement with Haisco Pharmaceutical Group Co., Ltd. for an exclusive, worldwide license (excluding Greater China, and, with respect to one of the two licensed compounds, also excluding India and certain Southeast Asian territories) to develop, manufacture, and commercialize two clinical-stage drug candidates: NXP100, and NXP200 (see Note 3a). |
| c. | Liquidity and Capital Resources |
The Company has incurred net operating losses since its inception and had an accumulated deficit of $
During the three months ended September 30, 2026, the Company sold a total of
During the nine months ended September 30, 2026, the Company sold a total of
On July 1, 2026, the Company completed a public offering selling
Management believes that its existing cash and cash equivalents as of September 30, 2026, enable the Company to fund planned operations for at least 12 months following the issuance date of these condensed financial statements.
The Company will need to raise additional capital to complete the clinical trials aimed at developing the product candidates, obtain regulatory and marketing approvals, and, if approved, commercialize our product candidates. There can be no assurances that the Company will be able to secure such additional financing, or on terms that are satisfactory to the Company, and that it will be sufficient to meet its needs. In the event the Company is unable to obtain sufficient funding, this could force the Company to delay, limit, or reduce its product development, clinical trials, commercialization efforts, or other operations, or even close down or liquidate.
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NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES:
| a. | Basis of Presentation |
The accompanying condensed financial statements are unaudited. The unaudited condensed financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”), are stated in U.S. dollars, and follow the requirements of the Securities and Exchange Commission (“SEC”) for interim financial reporting. Accordingly, they do not include all of the information and disclosures required by U.S. GAAP for complete financial statements, as certain footnotes or other financial information that U.S. GAAP normally requires can be condensed or omitted. The unaudited condensed financial statements have been prepared on the same basis as the audited financial statements for the year ended 2025. The unaudited condensed financial statements include the accounts of the Company. Any reference in these notes to applicable guidance is meant to refer to the authoritative U.S. GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) of the Financial Accounting Standards Board (“FASB”).
In the opinion of management, the unaudited condensed financial statements include all normal and recurring adjustments that are considered necessary for the fair statement of results for the interim periods. The results for the period ended September 30, 2026, are not necessarily indicative of those expected for the year ending December 31, 2026, or for any future period. The condensed balance sheet as of September 30, 2026 and December 31, 2025, included herein was derived from the audited financial statements as of those dates but does not include all disclosures required by U.S. GAAP. These unaudited condensed financial statements should be read in conjunction with the Company’s audited financial statements and the related notes thereto for the year ended December 31, 2025, included in the Company’s Annual Report on Form 10-K filed with the SEC on February 11, 2026.
The significant accounting policies adopted and used in preparing the financial statements are consistent with those of the previous financial year.
| b. | Use of Estimates in the Preparation of Financial Statements |
The preparation of the Company’s financial statements requires management to make estimates and assumptions that impact the reported amounts of assets, liabilities, and expenses in the Company’s financial statements and accompanying notes. The most significant estimates in the Company’s financial statements relate to accruals for research and development expenses and valuation allowances for deferred tax assets. These estimates and assumptions are based on current facts, future expectations, and various other factors believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of expenses that are not readily apparent from other sources. Actual results may differ materially and adversely from these estimates.
c. | Fair Value Measurement |
The Company follows authoritative accounting guidance, which, among other things, defines fair value, establishes a consistent framework for measuring fair value, and expands disclosure for each major asset and liability category measured at fair value on either a recurring or nonrecurring basis. Fair value is defined as the exchange price that would be received to sell an asset or paid to transfer a liability (at exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The three levels of inputs that may be used to measure fair value include:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. The Company’s Level 1 assets consist of money market funds.
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Level 2: Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities in active markets or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3: Unobservable inputs that are supported by little or no market activity. The fair value hierarchy gives the lowest priority to Level 3 inputs.
In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible, while also considering counterparty credit risk in its assessment of fair value.
During the three and nine months ended September 30, 2026 and 2025, there were
d. | Recently Issued Accounting Pronouncements Not Yet Adopted |
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740) ("ASC 740"). The update requires all public business entities on an annual basis to (1) disclose specific categories in the rate reconciliation and (2) provide additional information for reconciling items that meet a quantitative threshold and an explanation, if not otherwise evident, of the individual reconciling items disclosed, such as the nature, effect, and underlying causes of the reconciling items and the judgment used in categorizing the reconciling items. In addition, the update requires certain new disclosures of the amount of income taxes paid (net of refunds received) disaggregated by federal, state, and foreign taxes and the amount of income taxes paid (net of refunds received) disaggregated by individual jurisdictions in which income taxes paid is equal to or greater than five percent of total income taxes paid (net of refunds received). Other new disclosures required include income (or loss) from continuing operations before income tax expense (or benefit) disaggregated between domestic and foreign and income tax expense (or benefit) from continuing operations disaggregated by federal, state, and foreign. The new guidance is effective for annual periods beginning after December 15, 2024. Early adoption is permitted. The amendments are to be applied on a prospective basis, with retrospective application permitted. As an emerging growth company that has not opted out of the extended transition period for complying with new or revised financial accounting standards, the amendments in ASU 2023-09 are effective for annual periods beginning after December 15, 2025. The Company is currently evaluating the impact of the new standard on its financial statements and related disclosures.
In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses requires additional, disaggregated disclosure around certain income statement expense line items. This ASU mandates that entities, at each interim and annual period, disclose the amounts of (a) inventory purchases, (b) employee compensation, (c) depreciation, (d) intangible asset amortization, and (e) depletion, depreciation, and amortization for oil and gas activities included within each relevant expense caption presented on the income statement within continuing operations. Entities are also required to (1) combine certain disclosures already mandated under GAAP with these new requirements, (2) provide qualitative descriptions of expenses that are not disaggregated quantitatively, and (3) disclose total selling expenses and, annually, the definition of selling expenses. The guidance is effective for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the potential impact of adopting this new guidance on its financial statements and related disclosures.
In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements (“ASU 2025-11”), which clarifies the guidance in Topic 270 to improve the consistency of interim financial reporting. The ASU provides a comprehensive list of required interim disclosures and introduces a disclosure principle requiring entities to disclose events since the end of the last annual reporting period that have a material impact on the entity. ASU 2025-11 is effective for fiscal years beginning after December 15, 2027, including interim periods within those
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fiscal years, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2025-11 and the Company expects no material impact on consolidated financial statements of adopting.
| e. | Recent Accounting Pronouncements - Adopted |
In September 2025, FASB issued Accounting Standards Update No. 2025-07, Derivatives and Hedging (Topic 815): Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract (“ASU 2025-07”). ASU 2025-07 refines the scope of Topic 815 and provides additional guidance regarding share-based noncash consideration received from a customer in a revenue contract under Topic 606. The amendments in ASU 2025-07 are effective for fiscal years beginning after December 15, 2026, and interim periods within those fiscal years, with early adoption permitted. The Company elected to early adopt ASU 2025-07 effective January 1, 2026 utilizing the prospective transition method. The adoption did not have a material impact on the Company’s unaudited condensed financial statements.
NOTE 3 – COMMITMENTS AND CONTINGENCIES:
| a. | License Agreements |
Haisco Pharmaceuticals License Agreement
On June 22, 2026 (the "Execution Date"), the Company entered into an Exclusive License Agreement (the "Haisco Agreement") with Haisco Pharmaceutical Group Co., Ltd. ("Haisco"), pursuant to which Haisco granted the Company an exclusive, worldwide license (excluding Greater China, and, with respect to one of the two licensed compounds, also excluding India and certain Southeast Asian territories)(“the Territory”) to develop, manufacture, and commercialize two clinical-stage drug candidates: NXP100 (HSK39297, a complement Factor B inhibitor), and NXP200 (HSK42360, a paradox-breaker BRAF inhibitor).
The Haisco Agreement was subject to a financing condition and became effective on July 1, 2026 (the “Effective Date”), when the Company completed its public offering, thereby satisfying the financing condition. Under the terms of the Haisco Agreement, in July 2026, after the public offering closed, the Company paid Haisco a one-time, non-refundable, non-creditable upfront payment of $
The Company evaluated the accounting treatment of the Haisco Agreement. The acquired set consists of the licensed rights, intellectual property, know-how, regulatory documentation, clinical data and manufacturing technology for the two clinical-stage drug candidates. The Company concluded that this set does not meet the definition of a business under ASC 805, Business Combinations, because it does not include an input and a substantive process, including an organized workforce, that together significantly contribute to the ability to create outputs. Accordingly, the transaction was accounted for as an asset acquisition. The acquired assets represent in-process research and development (“IPR&D”) that had not received regulatory approval and had no alternative future use as of the Effective Date. Therefore, the $
The milestone, royalty, sublicense revenue and change of control payments represent contingent consideration. Following the Company’s early adoption of ASU 2025-07 effective January 1, 2026, the Company determined that
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these payments qualify for scope exceptions from derivative accounting under ASC 815, Derivatives and Hedging. They are therefore accounted for under ASC 450, Contingencies, and recognized when they become probable and reasonably estimable. As of September 30, 2026, none of the contingent payments were considered probable, and accordingly
Any potential milestone or royalty payment amounts have not been accrued as of September 30, 2026, due to the uncertainty related to the achievement of these events or milestones.
CRT Pioneer Fund License Agreement
There have been no material changes to the CRT Pioneer Fund License Agreement, as previously disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025, filed with the SEC on February 11, 2026 (see Note 5a in the Notes to the Financial Statements in our Annual Report).
Any potential milestone or royalty payment amounts have not been accrued as of September 30, 2026, and December 31, 2025, due to the uncertainty related to the achievement of these events or milestones.
University of Edinburgh License Agreement
There have been no material changes to the University of Edinburgh (“UoE”) License Agreement as previously disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025, filed with the SEC on February 11, 2026 (see Note 5a in the Notes to the Financial Statements in our Annual Report).
As of September 30, 2026, the Company has paid UoE $
| b. | Related Party Transactions |
There have been no related party transactions in the reported quarter.
| c. | Contingencies |
As of September 30, 2026, and December 31, 2025, there are
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NOTE 4 – SHAREHOLDERS’ EQUITY:
| a. | Public Offering |
In July 2026, the Company completed a public offering selling
In February 2025, the Company completed a public offering in which it sold
In February 2022, the Company granted to the underwriter of the IPO
NOTE 5 – SHARE-BASED PAYMENTS:
| a. | 2021 Global Equity Incentive Plan (“Incentive Plan”) |
Restricted Stock Awards
Restricted stock awards (“RSAs”) have been granted to employees. The value of an RSA award is based on the Company’s share price on the date of grant. The Company granted RSAs in accordance with the Incentive Plan.
The following table summarizes the Company’s RSA activity for the nine months ended September 30, 2026, as described above, relating to the RSAs granted pursuant to the Incentive Plan:
| | | | Weighted | | Weighted average | | Aggregated | ||
| | Number of | | average grant | | contractual term | | intrinsic value | ||
| | shares | | date fair value | | (in years) | | (in thousands) | ||
Balance, December 31, 2025 | | |
| $ | |
|
| $ | | |
Granted |
| |
| | |
| |
| | |
Forfeited | | ( | | | | | | | | |
Vested |
| ( |
| | |
| |
| | |
Outstanding – September 30, 2026 |
| |
| $ | |
|
| $ | | |
Expected to vest – September 30, 2026 |
| |
| $ | |
|
| $ | | |
As of September 30, 2026, there was $
On January 6, 2026, the Company issued
On January 2, 2025, the Company issued
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extended to July 15, 2026, conditioned upon their continued service. On July 7, 2026, the vesting of the first one-third of the January 2025 Grants was extended to December 11, 2026, conditioned upon their continued service.
On January 4, 2024, the Company
On January 12, 2023, the Company issued
On April 1, 2022, the Company issued
On July 27, 2021, Mr. Bentsur, Dr. Poradosu, and Mr. Shemesh were granted
Share Compensation Expense
For the three months ended September 30, 2026, the Company recognized expenses of $
For the nine months ended September 30, 2026, the Company recognized expenses of $
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NOTE 6 – NET LOSS PER SHARE:
| a. | Basic |
Basic net loss per share is calculated by dividing the net loss attributable to the Company’s stockholders by the weighted average number of common shares outstanding.
| | | | | | | | | | | | | |
| | For the three months ended | | For the nine months ended | | ||||||||
| | September 30, 2026 | | September 30, 2025 | | September 30, 2026 | | September 30, 2025 | | ||||
| | | in thousand U.S. dollars except per share and share amounts | | |||||||||
Net loss | | $ | ( |
| $ | ( | | $ | ( |
| $ | ( |
|
Effect of warrants modification, see Note 6 | | | — | | | ( | | | — | | | ( | |
Total net loss attributable to common shareholders | | $ | ( | | $ | ( | | $ | ( | | $ | ( | |
Basic and diluted net loss per common share | | | ( |
| | ( | | | ( |
| | ( |
|
Weighted average of common shares outstanding | | | |
| | | | | |
| | |
|
Basic loss per share is calculated by dividing the result attributable to equity holders of the Company by the weighted average number of shares of common stock in issue during the period.
| | For the three months ended | | For the nine months ended | | ||
| | September 30, 2026 | | September 30, 2026 | | ||
Weighted average of common shares | | | |
| | | |
Average unvested RSAs | | | ( |
| | ( | |
Weighted average of common shares outstanding | | | |
| | |
|
| b. | Diluted |
The following potentially dilutive securities were excluded from the calculation of diluted net loss per common share because their effect would have been anti-dilutive for the periods presented:
| | |||
| | September 30, | ||
| | 2026 | | 2025 |
Common shares issuable in relation to: |
| |
| |
Warrants |
| |
| |
Options |
| |
| |
Unvested RSAs * |
|
| | |
| * | Includes |
NOTE 7 – SEGMENT REPORTING:
| a. | The Company operates in |
Management does not segregate its business for internal reporting. The Company's Chief Operating Decision Maker (“CODM”), who is the CEO, evaluates the Company's performance based on net losses its unified internal reporting, which is consistent with the presentation in the Company’s financial statements.
Net loss is used to make key operating decisions, such as allocation of resources between the company’s costs.
17
The CODM uses many quantitative and qualitative factors, including net loss and quarterly cash burn, to benchmark the Company against its competitors. The competitive analysis, along with monitoring budgeted versus actual results, is used to assess segment performance and establish management’s compensation.
Significant segment expenses are presented in the Company’s statements of operations. Additional disaggregated significant segment expenses on a functional basis that are not separately presented on the Company’s statements of operations are presented below:
| Three Months Ended September 30 | | Nine Months Ended September 30 | ||||||||
| 2026 | | 2025 | | 2026 | | 2025 | ||||
R&D Employee Expenses | $ | |
| $ | |
| $ | |
| $ | |
R&D Clinical Trial Expenses | | |
| | | | | |
| | |
R&D Manufacturing | | | | | | | | | | | |
R&D License Fees | | | | | | | | | | | |
G&A Professional Fees | | | | | | | | | | | |
G&A Employee Expenses | | | | | | | | | | | |
G&A Insurance and other | | | | | |
| | | | | |
Other Segment Items * | | ( |
| | ( |
| | ( |
| | ( |
Segment Loss | $ | |
| $ | | | $ | |
| $ | |
* -
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Item 2.Management’s Discussion and Analysis of the Results of Operations
You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and related notes appearing elsewhere in this report. The following discussion and analysis contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”), including, without limitation, statements regarding our expectations, beliefs, intentions or future strategies that are signified by the words “expect,” “anticipate,” “intend,” “believe,” “may,” “plan,” “seek” or similar language. All forward-looking statements included in this document are based on information available to us on the date hereof, and we assume no obligation to update any such forward-looking statements. For such forward-looking statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Our business and financial performance are subject to substantial risks and uncertainties. Actual results could differ materially from those projected in the forward-looking statements. In evaluating our business, you should carefully consider the information set forth under the heading “Risk Factors” herein and in our Annual Report on Form 10-K for the year ended December 31, 2025. As used below, the words “we,” “us,” and “our” may refer to Nuvectis Pharma, Inc.
Overview
We are a biopharmaceutical company focused on the development of innovative precision medicines for the treatment of complement-related conditions and oncology.
NXP100 (Complement Factor B Inhibitor)
In June 2026, we licensed exclusive world-wide development, manufacturing and commercial rights, excluding China, to NXP100/HSK39297/ciprocopan (“NXP100”) an oral, once daily, potent and selective small-molecule complement Factor B inhibitor (“CFBi”) in advanced stages of development. Factor B is a key component of the complement system, a clinically validated target with an FDA approved CFBi approved in several chronic diseases including paroxysmal nocturnal hematoglobinuria (“PNH”), IgA Nephropathy (“IgAN”), and C3 glomerulonephritis (C3G). Factor B is considered potentially important in other diseases such as lupus nephritis (“LN”), myasthenia graves (“MG”), and dry age-related macular degeneration (“d-AMD”). NXP100’s PK/PD profile enables a once-daily administration compared to iptacopan, the only FDA-approved factor B inhibitor, which is administered orally twice-daily, providing a potential dosing convenience advantage which is an important attribute for diseases requiring life-long therapy.
Ciprocopan (NXP100) has received marketing approval by the National Medical Products Administration (NMPA) in China for PNH patients previously untreated with complement inhibitors (treatment naive). A marketing application for previously treated PNH is under review, and a Phase 3 study for IgAN and a Phase 2 study in LN are ongoing in China. Based on cross-trial comparisons, NXP100 demonstrated similar activity to iptacopan, with a similar safety profile.
NXP200 (BRAF Inhibitor)
In June 2026, we licensed exclusive world-wide development, manufacturing and commercial rights, excluding China, to NXP200/HSK42360 an inhibitor of the BRAF serine/threonine kinase (“BRAFi”) that has the potential to be a best-in-class, brain-penetrant paradox breaker, overcoming broad-spectrum BRAF-related drug resistance and to become a treatment option for multiple solid tumor types and primary brain cancer. The paradox breaking properties of NXP200 have the potential to address key unmet needs associated with BRAF inhibition, including emerging resistance to first generation BRAFi while reducing toxicities associated with their usage. To date, NXP200 demonstrated excellent efficacy in treating low- and high-grade glioma in adult patients, and generated single agent durable responses in heavily pretreated patients with non-small cell lung cancer, colorectal, papillary thyroid and others. A phase 1b expansion study is ongoing in China.
In October, expanded NXP200 Phase 1b data in patients with recurrent or progressive BRAF V600-mutated gliomas were presented at the 2026 ESMO Congress by our partner Haisco. As of the May 4, 2026 cutoff, 27 efficacy-evaluable patients with recurrent or progressive BRAF V600 glioma were treated with NXP200 monotherapy, including 20 patients with high-grade glioma and 7 with low-grade glioma. Treatment with NXP200 resulted in an overall response rate (“ORR”) of 40.0% in the high-grade glioma cohort, including 3 complete responses (“CRs”) (one preliminary CR) and 42.9%, including one confirmed CR, in the low-grade glioma cohort (responses
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based on RANO 2.0 criteria). Notably, among the three patients previously treated with a BRAF inhibitor, two achieved a partial response and one had stable disease (“SD”). Deep responses (>80% tumor burden reduction) were achieved in 87.5% of responders with high-grade glioma and 66.7% of responders with low-grade glioma. 81.5% of patients achieved tumor reduction and the Disease Control Rate (ORR plus SD) was 85.2%. A phase 1b expansion study is ongoing in China.
NXP900 (SRC/YES1 Kinase Inhibitor)
We have licensed exclusive world-wide development and commercial rights to NXP900, a SRC Family Kinase (“SFK”) inhibitor that potently inhibits the c-Src (“SRC”) and YES1 kinases. NXP900 was discovered at the University of Edinburgh, Scotland.
There are two ongoing combination Phase 1b studies, and a third pending. The first trial is evaluating the safety, tolerability and preliminary efficacy of NXP900 combination with a market-leading EGFR, osimertinib, and the second is a combination study with the anaplastic lymphoma kinase (“ALK”) inhibitor, lorlatinib. An investigator-sponsored trial to evaluate the combination of NXP900 plus the recently approved daraxonrasib in patients with pancreatic cancer is planned at two leading medical centers in the U.S.
Results of Operations
From our inception on July 27, 2020, through September 30, 2026, we did not generate any revenue. Since our inception through September 30, 2026, our primary activities have been focused on the development of our four drug candidates, NXP100, NXP200, NXP900, and NXP800, including the completion of in-licensing agreements for each drug candidate, IND-enabling studies, and other organizational activities such as capital raising. For NXP900, regulatory filings with the Medicines and Healthcare products Regulatory Agency (“MHRA”) and FDA, preparation and execution for the Phase 1a, Phase 1b (single agent) and Phase 1b (combination study with osimertinib) clinical trials for NXP900, which commenced in September 2023, August 2025 and December 2025, respectively.
Research and Development Expenses
Research and development expenses include costs directly attributable to the conduct of research and development programs, including licensing fees, cost of salaries, share-based compensation expenses, payroll taxes, and other employee benefits, subcontractors, and materials and services used for research and development activities, including clinical trials, manufacturing costs, and professional services. All costs associated with research and development are expensed as incurred.
Product candidates in later stages of clinical development typically incur higher development costs than those in earlier stages, primarily due to the increased size and duration of later-stage clinical trials. We anticipate that our research and development expenses will increase substantially in connection with our ongoing and planned preclinical and clinical development activities in the near term and beyond. The successful development of our product candidates is highly uncertain. At this time, we cannot accurately estimate or determine the nature, timing, or costs of the efforts required to complete the preclinical and clinical development of any of our product candidates. We may also fail to obtain regulatory approval for any of our product candidates.
General and Administrative Expenses
General and administrative expenses consist primarily of salaries and personnel-related costs, including stock-based compensation, for our personnel in executive, finance and accounting, and other administrative functions. General and administrative expenses also include legal fees related to patent and corporate matters, as well as professional fees paid for accounting, auditing, consulting, and tax services. These expenses also cover insurance costs, investor relations activities, travel expenses, and facility costs not otherwise included in research and development expenses.
We anticipate that our general and administrative expenses will increase in the future as we expand our headcount to support ongoing research and development, as well as other corporate activities.
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The following table summarizes our results of operations expenses for the three months ended September 30, 2026 and 2025: (in thousands)
| | Three Months Ended September 30, | | | | ||||
| | 2026 | | 2025 | | | Change | ||
OPERATING EXPENSES: |
| | |
| | |
| | |
Research and development |
| $ | 27,370 |
| $ | 5,774 |
| $ | 21,596 |
General and administrative |
| | 3,679 |
| | 2,020 |
| | 1,659 |
| | | | | | | | | |
OPERATING LOSS |
| | (31,049) |
| | (7,794) |
| | (23,255) |
Finance income |
| | 979 |
| | 332 |
| | 647 |
| | | | | | | | | |
NET LOSS |
| $ | (30,070) |
| $ | (7,462) |
| $ | (22,608) |
Research and Development Expenses
The following table summarizes our research and development expenses for the three months ended September 30, 2026 and 2025: (in thousands)
| | For the three months ended September 30, | | | Increase/ | ||||
| | 2026 | | 2025 | | | (Decrease) | ||
Employee compensation and benefits | | $ | 2,804 |
| $ | 1,635 | | $ | 1,169 |
Clinical expenses | | | 2,221 |
| | 1,736 | | | 485 |
Manufacturing | | | 545 |
| | 402 | | | 143 |
License fee | | | 21,801 |
| | 2,000 | | | 19,801 |
Professional services and other | | | (1) |
| | 1 | | | (2) |
Total research and development expenses | | $ | 27,370 |
| $ | 5,774 | | $ | 21,596 |
Research and development expenses increased by $21.6 million, or 374%, during the three months ended September 30, 2026, compared to the same period in 2025. The increase in research and development expense during the three months ended September 30, 2026, was primarily driven by a $19.8 million increase in license fees due to $20.0 million related to our license agreement with Haisco Inc, $1.8 million in license fees to the University of Edinburgh related to our fund raising milestones, partially offset by $2.0 million in milestone achievements in 2025, $1.2 million increase in employee compensation and benefits, and $0.6 million increase in clinical trial and manufacturing expenses related to the development of NXP100, NXP200 and NXP900.
The following table summarizes our general and administrative expenses for the three months ended September 30, 2026 and 2025: (in thousands)
| | For the three months ended September 30, | | | | ||||
| | 2026 | | 2025 | | | Increase | ||
Professional and consulting services |
| $ | 2,285 |
| $ | 1,116 | | $ | 1,169 |
Employee compensation and benefits |
| | 672 |
| | 472 | | | 200 |
Insurance and other |
| | 722 |
| | 432 | | | 290 |
Total general and administrative expenses |
| $ | 3,679 |
| $ | 2,020 | | $ | 1,659 |
General and administrative expenses increased by $1.7 million, or 82%, during the three months ended September 30, 2026, compared to the same period in 2025. The increase in general and administrative expenses during the three months ended September 30, 2026, was primarily driven by the $1.2 million increase in professional and consulting services, $0.2 million increase in employee compensation and benefits and $0.3 million increase related to public company-related expenses.
As a result of the foregoing, our loss from operations for the three months ended September 30, 2026, increased $23.3 million or 298%, compared to the same period in 2025.
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The following table summarizes our results of operations expenses for the nine months ended September 30, 2026, and 2025:
(in thousands)
| | Nine Months Ended September 30, | | | | ||||
| | 2026 | | 2025 | | | Change | ||
OPERATING EXPENSES: |
| | |
| | |
| | |
Research and development |
| $ | 36,160 |
| $ | 13,067 |
| $ | 23,093 |
General and administrative |
| | 8,346 |
| | 6,890 |
| | 1,456 |
| | | | | | | | | |
OPERATING LOSS |
| | (44,506) |
| | (19,957) |
| | (24,549) |
Finance income |
| | 1,366 |
| | 829 |
| | 537 |
| | | | | | | | | |
NET LOSS |
| $ | (43,140) |
| $ | (19,128) |
| $ | (24,012) |
Research and Development Expenses
The following table summarizes our research and development expenses for the nine months ended September 30, 2026, and 2025:
(in thousands)
| | For the nine months ended September 30, | | | Increase/ | ||||
| | 2026 | | 2025 | | | (Decrease) | ||
Employee compensation and benefits | | $ | 6,832 |
| $ | 4,991 | | $ | 1,841 |
Clinical expenses | | | 5,388 | | | 4,377 | | | 1,011 |
Manufacturing | | | 2,140 |
| | 1,234 | | | 906 |
License fee | | | 21,801 |
| | 2,438 | | | 19,363 |
Professional services and other | | | (1) |
| | 27 | | | (28) |
Total research and development expenses | | $ | 36,160 |
| $ | 13,067 | | $ | 23,093 |
Research and development expenses increased by $23.1 million during the nine months ended September 30, 2026, compared to the same period in 2025. The increase in research and development expenses during the nine months ended September 30, 2026, was primarily driven by a $19.4 million increase in license fees, a $1.8 million increase in employee compensation and benefits, $1.0 million increase in clinical trial expenses, and a $0.9 million increase in manufacturing expenses.
General and Administrative Expenses
The following table summarizes our general and administrative expenses for the nine months ended September 30, 2026, and 2025: (in thousands)
| | For the nine months ended September 30, | | | | ||||
| | 2026 | | 2025 | | | Increase | ||
Professional and consulting services |
| $ | 4,979 |
| $ | 4,118 | | $ | 861 |
Employee compensation and benefits |
| | 1,841 |
| | 1,446 | | | 395 |
Insurance and other |
| | 1,526 |
| | 1,326 | | | 200 |
Total general and administrative expenses |
| $ | 8,346 |
| $ | 6,890 | | $ | 1,456 |
General and administrative expenses increased $1.5 million during the nine months ended September 30, 2026, compared to the same period in 2025. The increase in general and administrative expenses during the nine months ended September 30, 2026, was primarily driven by the $0.9 million increase in professional and consulting services related to public company-related expenses, a $0.4 million increase in employee compensation and benefits, and a $0.2 million increase in insurance and other expenses.
As a result of the foregoing, our loss from operations for the nine months ended September 30, 2026, increased $24.5 million, compared to the same period in 2025, which was primarily driven by increases in license fees, clinical trial expenses, manufacturing, and employee compensation and benefits.
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Liquidity and Capital Resources
As of September 30, 2026, we had $140.7 million of cash and cash equivalents. For the three months ended September 30, 2026 and 2025, we reported net losses of $30.1 million and $9.9 million, respectively. For the nine months ended September 30, 2026, and 2025, our net losses were $43.1 million and $19.1 million, respectively.
On February 6, 2025, we completed a public offering, in which we received gross proceeds of $15.5 million, before deducting underwriting discounts and expenses and other offering expenses (for net proceeds of $14.0 million).
On July 1, 2026, we completed a public offering, in which we received gross proceeds of $100.0 million, before deducting underwriting discounts and expenses and other offering expenses. On July 29, 2026, the underwriters fully exercised their option to purchase an additional 750,000 shares, for which we received additional gross proceeds of $15.0 million before deducting underwriter discounts and expenses. The offering resulted in total net proceeds of approximately $106.3 million, after deducting underwriting discounts, commissions, and estimated offering expenses payable by us.
On August 21, 2026, we filed a shelf registration statement on Form S-3 (the “Registration Statement”). Pursuant to the Registration Statement, we may offer and sell securities having an aggregate public offering price of up to $200.0 million. In connection with the filing of the Registration Statement, we also amended our sales agreement with Jefferies LLC. (the “Sales Agent”), pursuant to which we may issue and sell shares of our common stock for an aggregate offering price of up to $75.0 million under an at-the-market offering program (the “ATM”), which is included in the $200.0 million of securities that may be offered pursuant to the Registration Statement. Pursuant to the ATM, we will pay the Sales Agent a commission rate of up to 3.0% of the gross proceeds from the sale of any shares of our common stock. We are not obligated to make any sales of shares under the ATM.
We believe that our existing cash and cash equivalents as of September 30, 2026, will enable us to fund our operating expenses and capital expenditures through at least the next 12 months from the issuance of our financial statements. We have based this estimate on assumptions that may prove to be incorrect, and we could exhaust our available capital resources sooner than expected. Our long-term viability is dependent on our ability to raise additional capital to finance our operations.
We expect our expenses to increase in connection with our ongoing activities, particularly as we advance the clinical trials of our current or future product candidates, including milestone payments and sponsored research commitments associated with our license agreements for our drug candidates. In addition, we expect to incur additional costs associated with operating as a public company as we continue to grow, including increased legal, accounting, investor relations, and other expenses. The timing and amount of our operating expenditures will depend largely on our ability to:
| ● | advance development of our clinical and preclinical programs; |
| ● | manufacture, or procure the manufacturing of, our preclinical and clinical drug material and develop processes for late-stage and commercial manufacturing; |
| ● | seek regulatory approvals for any current or future product candidates that successfully complete clinical trials; |
| ● | achieve milestones in accordance with our license agreements; |
| ● | establish a sales, marketing, medical affairs, and distribution infrastructure to commercialize any current or future product candidates for which we may obtain marketing approval; |
| ● | hire additional clinical, quality control, and scientific personnel; |
| ● | expand our operational, financial, and management systems and increase personnel, including personnel to support our clinical development, manufacturing, and commercialization efforts and our operations as a public company; |
| ● | obtain, maintain, expand, and protect our intellectual property portfolio; and |
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| ● | acquire additional product candidates. |
We anticipate that we will require additional capital as we seek regulatory approval of our product candidates and if we choose to pursue in-licenses or acquisitions of other product candidates. If we receive regulatory approval for our current or future product candidates, we expect to incur significant commercialization expenses related to product manufacturing, sales, marketing and distribution, depending on where we choose to commercialize.
Because of the numerous risks and uncertainties associated with research, development, and commercialization of our product candidates, we are unable to estimate the exact amount of our working capital requirements. Our future funding requirements will depend on and could increase significantly as a result of many factors, including:
| ● | the scope, progress, and costs of researching and developing our current or future product candidates, including the timing and safety, tolerability, and efficacy results from our preclinical and clinical trials; |
| ● | the costs, timing, and outcome of regulatory review of our current or future product candidates; |
| ● | the costs, timing, and ability to manufacture our current or future product candidates to supply our preclinical development efforts and our clinical trials; |
| ● | the costs of future activities, including product sales, medical affairs, marketing, manufacturing, and distribution, for any of our current or future product candidates for which we receive marketing approval; |
| ● | the costs of manufacturing commercial-grade products and the necessary inventory to support the commercial launch; |
| ● | the ability to receive additional non-dilutive funding, including grants from organizations and foundations; |
| ● | the revenue, if any, received from commercial sale of our products, should any of our current or future product candidates receive marketing approval; |
| ● | the costs of preparing, filing, and prosecuting patent applications, obtaining, maintaining, expanding, and enforcing our intellectual property rights, and defending intellectual property-related claims; |
| ● | our ability to establish and maintain collaborations on favorable terms, if at all; and |
| ● | the extent to which we acquire or in-license other product candidates and technologies. |
Until such time, if ever, as we can generate substantial product revenue, we expect to finance our operations through a combination of public or private equity offerings, debt financings, governmental funding, collaborations, strategic partnerships and alliances, or marketing, distribution, or licensing arrangements with third parties. To the extent that we raise additional capital through the sale of equity or convertible debt securities, your ownership interest may be materially diluted, and the terms of such securities could include liquidation or other preferences that adversely affect your rights as a common stockholder. Debt financing and preferred equity financing, if available, may involve agreements that include restrictive covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures, or declaring dividends. In addition, debt financing would result in fixed payment obligations.
If we raise additional funds through governmental funding, collaborations, strategic partnerships and alliances, or marketing, distribution, or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs, or product candidates, or grant licenses on terms that may not be favorable to us. If we are unable to raise additional funds through equity or debt financings or other arrangements when needed, we may be required to delay, limit, reduce or terminate our research, product development or future commercialization efforts or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.
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Cash Flows
The following table provides information regarding our cash flows for the periods presented: (in thousands)
| | For the nine months ended September 30, | ||||
| | 2026 | | 2025 | ||
Net cash used in operating activities |
| $ | (36,320) |
| $ | (12,035) |
Net cash used in investing activities |
| | — |
| | — |
Net cash provided by financing activities |
| $ | 145,393 |
| $ | 28,944 |
Operating Activities
During the nine months ended September 30, 2026, $36.3 million of cash was used in operating activities. This was primarily attributable to our net loss of $43.1 million, partially offset by non-cash charges of $6.0 million. The change in our operating assets and liabilities was primarily due to $1.5 million for vendor accruals and a $0.1 million payment for our directors and officers' insurance.
During the nine months ended September 30, 2025, $12.0 million of cash was used in operating activities. This was primarily attributable to our net loss of $19.1 million, partially offset by non-cash charges of $4.6 million. The change in our operating assets and liabilities was primarily due to $3.1 million in future payments to vendor, and $0.1 million payment for our director and officer insurance.
Financing activities
During the nine months ended September 30, 2026, net cash provided by financing activities was $145.4 million, consisting primarily of net proceeds from the July 2026 public offering and the ATM Program.
During the nine months ended September 30, 2025, net cash provided by financing activities was $28.9 million, consisting primarily of net proceeds from the sale of common stock through the February 2025 public offering and the ATM Program.
Contractual Obligations and Other Commitments
We enter into contracts in the normal course of business with clinical research organizations, contract manufacturing organizations, and other third parties for clinical trials, preclinical research studies, and testing and manufacturing services. These contracts are cancelable by us upon prior written notice. Payments due upon cancellation consist only of payments for services provided or expenses incurred, including noncancelable obligations of our service providers, up to the date of cancellation. The amount and timing of such payments are not known.
We have also entered into license and collaboration agreements with third parties, which are in the normal course of business. We have not included future payments under these agreements since obligations under these agreements are contingent upon future events such as our achievement of specified development, regulatory, and commercial milestones, or royalties on net product sales.
Pursuant to the NXP100 and NXP200 License Agreement, we are required to make payments to Haisco Pharmaceutical Group Co., Ltd. ("Haisco"), for the achievement of certain development, regulatory and commercial sales milestones, including an upfront payment of $20.0 million which was paid in July 2026, totaling up to approximately an additional $1.4 billion in potential milestone payments, and 9% to 14% royalties on a tiered basis on net sales.
Pursuant to the NXP900 License Agreement, we are required to make payments to the UoE for certain development and regulatory milestones, including up to $45.0 million related to pre-approval milestones, up to $279.6 million (in addition to the $45.0 million) in regulatory and commercial sales milestones, mid-single digit to 8% royalties on a tiered basis on net sales and 2.5% of the gross amount of each of our future fund raising to a cumulative total of $3.0 million, unless development ceases. Additionally, we will provide UoE with up to an additional $754,000 in research and development support.
Pursuant to the NXP800 License Agreement, we are required to make payments to the ICR for certain development and regulatory milestones, including up to $22.0 million related to pre-approval milestones, up to $178 million (in addition to the $22.0 million) in regulatory and commercial sales milestones, and mid-single-digit to 10% royalties on a tiered basis on net sales, unless development
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ceases. Additionally, we originally agreed to provide the ICR with up to an additional $0.5 million in research and development. On March 31, 2022, we agreed to provide the ICR with an additional $0.4 million in research and development support ($0.9 million total). In July 2025, we announced a final clinical data update from the NXP800 Phase 1b study in ovarian cancer. Further development of NXP800 in ovarian cancer will not be pursued, and in the coming months we will evaluate the feasibility of development opportunities for NXP800 in other cancer types in which the patients’ performance status and other characteristics may allow treatment with NXP800 to be more impactful.
We do not currently have any long-term leases. We rent our office space in Fort Lee, New Jersey, based on a one-year agreement signed on May 1, 2026.
Off-Balance Sheet Arrangements
We did not have any off-balance sheet arrangements during the periods presented, and we do not currently have any, as defined in the rules and regulations of the SEC.
Critical Accounting Policies and Significant Judgments and Estimates
Our condensed financial statements and the related notes thereto included elsewhere in this Quarterly Report on Form 10-Q are prepared in accordance with U.S. generally accepted accounting principles. The preparation of condensed financial statements also requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, costs, expenses, and related disclosures. We base our estimates on historical experience and various other assumptions that we believe are reasonable under the circumstances. Actual results could differ significantly from the estimates made by management. To the extent that there are differences between our estimates and actual results, our future financial statement presentation, financial condition, results of operations, and cash flows will be affected.
There have been no significant changes to our critical accounting policies and estimates as compared to those described in “Note 2 – Summary of Significant Accounting Policies” to our audited financial statements set forth in our Annual Report on Form 10-K filed for the fiscal year ended December 31, 2025, with the SEC on February 11, 2026.
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Recently Issued Accounting Pronouncements
See Note 2 to our condensed financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for a discussion of recent accounting pronouncements.
Emerging Growth Company and Smaller Reporting Company Status
The Jumpstart Our Business Startups Act of 2012 permits an “emerging growth company” such as us to take advantage of an extended transition period to comply with new or revised accounting standards applicable to public companies until those standards would otherwise apply to private companies. We have elected to not “opt out” of this provision and, as a result, we will adopt new or revised accounting standards at the time private companies adopt the new or revised accounting standard and will do so until such time that we either (i) irrevocably elect to “opt out” of such extended transition period or (ii) no longer qualify as an emerging growth company.
We are also a “smaller reporting company,” meaning that the market value of our stock held by non-affiliates plus the proposed aggregate amount of gross proceeds to us as a result of our initial public offering is less than $700 million and our annual revenue was less than $100 million during the most recently completed fiscal year. We will continue to be a smaller reporting company for as long as either (i) the market value of our stock held by non-affiliates is less than $250 million or (ii) our annual revenue was less than $100 million during the most recently completed fiscal year, and the market value of our stock held by non-affiliates is less than $700 million. If we are a smaller reporting company at the time we cease to be an emerging growth company, we may continue to rely on exemptions from certain disclosure requirements that are available to smaller reporting companies. Specifically, as a smaller reporting company, we may choose to present only the two most recent fiscal years of audited financial statements in our Annual Report on Form 10-K and, similar to emerging growth companies, smaller reporting companies have reduced disclosure obligations regarding executive compensation.
Item 3. Quantitative and Qualitative Disclosures About Market Risks
Under SEC rules and regulations, because we are considered to be a “smaller reporting company,” we are not required to provide the information required by this item in this report.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
We maintain “disclosure controls and procedures,” as defined in Rule 13a-15(e) and Rule 15d-15(e) under the Securities Exchange Act of 1934, as amended, or the Exchange Act, that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure.
As of September 30, 2026, management carried out, under the supervision and with the participation of our principal executive officer and principal financial officer, an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Our disclosure controls and procedures are designed to provide reasonable assurance that information we are required to disclose in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in applicable rules and forms. Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of September 30, 2026, our disclosure controls and procedures were effective.
Changes in and Management’s Report on Internal Control over Financial Reporting
There were no changes in our internal controls over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the nine months ended September 30, 2026, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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Inherent Limitations on Effectiveness of Controls and Procedures
Our management, including our Chief Executive Officer and Vice President of Finance, believes that our disclosure controls and procedures and internal control over financial reporting are designed to provide reasonable assurance of achieving their objectives and are effective at the reasonable assurance level. However, management does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent or detect all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the company have been detected. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.
PART II – OTHER INFORMATION
Item 1.Legal Proceedings.
From time to time, we may become involved in legal proceedings arising in the ordinary course of our business, the resolution of which we do not anticipate would have a material adverse impact on our financial position, results of operations or cash flows. However, there is no certainty that any such future litigation that may arise would not have a material financial impact on our business. As of the date of this report, we were not a party to any material legal matters or claims.
Item 1A. Risk Factors.
The following information sets forth risk factors that could cause our actual results to differ materially from those contained in forward-looking statements we have made in this report and those we may make from time to time. You should carefully consider the risks described below, in addition to the other information contained in this report and our other public filings, before making an investment decision. Our business, financial condition or results of operations could be harmed by any of these risks. The risks and uncertainties described below are not the only ones we face. Additional risks not presently known to us or other factors not perceived by us to present significant risks to our business at this time also may impair our business operations.
Risks Related to Our Finances and Capital Requirements
Our limited operating history may make it difficult for you to evaluate the success of our business to date and to assess our future viability.
We are a clinical-stage biopharmaceutical company with a limited operating history. We were incorporated in Delaware in July 2020, and our operations to date have been limited to organizing and staffing our company, business planning, raising capital, identifying, investigating, licensing and evaluating potential product candidates, establishing arrangements with third parties for the manufacture of our product candidates and component materials, and conducting research and development activities. While all our product candidates are in the clinical development phase, we have not yet demonstrated our ability to successfully conduct or complete any clinical development program for any of our drug candidates, obtain marketing approvals, manufacture a commercial-scale product or arrange for a third party to do so on our behalf, or conduct sales, marketing and distribution activities necessary for successful product commercialization. Consequently, any predictions about our future success or viability may not be accurate.
We may need to transition at some point in time from a company with a research and development focus to a company capable of supporting commercial activities related to the full product life cycle. We may not be successful in such a transition.
We have incurred losses since inception and anticipate that we will continue to incur losses for the foreseeable future. We may never achieve or maintain profitability.
Investment in biopharmaceutical product development is a highly speculative undertaking and entails substantial upfront capital expenditures and significant risk that our current or potential future product candidates will fail to demonstrate adequate efficacy or an
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acceptable safety profile, gain regulatory approval and become commercially viable. We are still in the early stages of development of our product candidates and initiated our first clinical trial in December 2021. We have no products approved for commercial sale and have not generated any revenue from product sales to date. We continue to incur significant research and development and other expenses related to our ongoing operations. In addition, as a business with a limited operating history, we may encounter unforeseen expenses, difficulties, complications, delays and other known and unknown factors, such as the COVID-19 pandemic.
We have incurred losses in each period since we incorporated in July 2020. Since inception through the end of September 30, 2026, we had an accumulated deficit of $142.8 million. We expect to continue to incur significant losses for the foreseeable future, and we expect these losses to increase substantially if and as we continue our research and development efforts for our lead product candidate; conduct preclinical studies and clinical trials for our current and future product candidates; seek marketing approvals for any current or future product candidate that successfully completes clinical trials; experience any delays or encounter any issues with any of the above; establish a sales, marketing and distribution infrastructure and scale-up manufacturing capabilities to commercialize any current or future product candidates for which we may obtain regulatory approval; obtain, expand, maintain, enforce and protect our intellectual property portfolio; hire additional clinical, regulatory and scientific personnel; and operate as a public company.
Our product candidates, NXP100, NXP200 and NXP900, are in clinical development. Our product candidates, and any future product candidates that we may develop will require additional preclinical and/or clinical studies, regulatory review and approval, substantial investment, access to sufficient clinical and commercial manufacturing capacity and significant marketing efforts before we can potentially generate any revenue from product sales. To date, we have not generated any revenue from our product candidate. Our ability to generate revenue will depend on a number of factors, including, but not limited to:
| ● | our ability to timely and successfully complete our preclinical studies and clinical trials, which may be significantly slower or more costly than anticipated and will depend upon several factors including the performance of third-party contractors, our ability to enroll patients into the clinical trials and the safety, tolerability and efficacy results generated in clinical trials; |
| ● | successful submissions of IND applications to the FDA and any additional comparable applications; |
| ● | completion of nonclinical studies necessary for the IND or comparable submission, as appropriate; |
| ● | whether we are required by the FDA or similar foreign regulatory authorities to conduct additional clinical trials or other studies to support the approval and commercialization of our current or future product candidates; |
| ● | the FDA’s and similar foreign regulatory authorities’ acceptance of the safety, potency, purity, efficacy and risk to benefit profile of our current or future product candidates; |
| ● | the prevalence, duration and severity of side effects or other safety issues experienced with our current or future product candidates, if any; |
| ● | the timely receipt of necessary marketing approvals from the FDA and similar foreign regulatory authorities; |
| ● | the actual and perceived availability, cost, risk profile and safety and efficacy of our current or future product candidates, if approved, relative to existing and future alternative cancer therapies and competitive product candidates and technologies; |
| ● | our ability and the ability of third parties with whom we contract to manufacture adequate clinical and commercial supplies of our current or future product candidates, to remain in good standing with regulatory authorities and to develop, validate and maintain commercially viable manufacturing processes and analytics that are compliant with cGMP; |
| ● | our ability to successfully develop a commercial strategy and to commercialize any current or future product candidates in the United States and internationally, if approved for marketing, reimbursement, sale and distribution in such countries and territories, whether alone or in collaboration with others; |
| ● | patient demand for our current or future product candidates, if approved; and |
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| ● | our ability to establish and enforce intellectual property rights in and to our current or future product candidates. |
Many of the factors listed above are beyond our control and could cause us to experience significant delays or prevent us from obtaining regulatory approvals or commercializing our current and future product candidates. Even if we can commercialize any current or future product candidates, we may not achieve profitability soon after generating product sales, if ever.
We will require substantial additional funding. Raising additional capital may cause dilution to our existing stockholders, or require us to relinquish proprietary rights. If we are unable to raise capital as needed, we may be compelled to delay, reduce or eliminate our product development programs or commercialization efforts.
We expect our expenses to increase in parallel with our ongoing activities, particularly as we continue our activities to identify new product candidates and initiate clinical trials of, and seek marketing approval for, any of our current or future product candidates. In addition, if we obtain marketing approval for any of our current or future product candidates, we expect to incur significant commercialization expenses related to product sales, marketing, manufacturing, and distribution. Furthermore, we expect to incur significant additional costs associated with operating as a public company. Accordingly, we will need to obtain substantial additional funding in connection with our continuing operations. We cannot be certain that additional funding will be available on acceptable terms, or at all. Until such time, if ever, as we can generate substantial product revenue, we expect to finance our operations through a combination of public or private equity offerings, At-the-Market offering program, debt financings, governmental funding, collaborations, strategic partnerships and alliances or marketing, distribution or licensing arrangements with third parties. To the extent that we raise additional capital through the sale of equity or convertible debt securities, your ownership interest will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect your rights as a stockholder. Debt financing and preferred equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends.
If we raise additional funds through collaborations, strategic alliances or marketing, distribution or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates or grant licenses on terms that may not be favorable to us.
If we are unable to raise capital when needed or on attractive terms, we could be forced to delay, reduce or eliminate our discovery and preclinical development programs or any future commercialization efforts.
Tariffs and other trade measures could adversely affect our business, results of operations, financial position and cash flows.
Our business and results of operations may be adversely affected by uncertainty and changes in U.S. trade policies, including tariffs, trade agreements or other trade restrictions imposed by the U.S. or other governments. Our input costs for raw materials and other goods, chemical reagents and laboratory equipment, may be adversely affected by tariffs imposed by the U.S. government on products imported into the United States. Any imposition of or increase in tariffs on the goods we purchase could increase our research and development costs.
Additional tariffs, further trade restrictions and retaliatory trade measures could disrupt our supply chain and logistics, restrict or limit the availability of goods or supplies, cause adverse financial impacts due to volatility in foreign exchange rates and interest rates, and place inflationary pressures on raw materials. It may be time-consuming and expensive for us to alter our business operations to adapt to or comply with any changes in international trade policies and agreements and any failure to do so could have a material adverse effect on our business. Any potential impact will depend on future developments with respect to trade policy and the results of trade negotiations, all of which are beyond our control. These potential impacts, while uncertain, could adversely affect our business, results of operations and financial condition.
Tariffs or other trade restrictions may lead to continuing uncertainty and volatility in U.S. and global financial and economic conditions and commodity markets, declining consumer confidence, significant inflation and diminished expectations for the economy, and ultimately reduced demand for our products. Such conditions could have a material adverse impact on our business, results of operations and cash flows.
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Any rising trade and political tensions or unfavorable government policies on international trade may affect the demand for our drug products, the competitive position of our drug products, the hiring of scientists and other research and development personnel, the import or export of raw materials in relation to drug development or prevent us from selling our drug products in certain countries.
As of September 30, 2026, we were not aware of any tariffs affecting our operations.
Inadequate funding for the FDA, the SEC and other government agencies, including from government-shutdowns, or other disruptions to these agencies’ operations, could hinder their ability to hire and retain key leadership and other personnel, prevent new products and services from being developed or commercialized in a timely manner or otherwise prevent those agencies from performing normal business functions on which the operation of our business may rely, which could negatively impact our business.
The ability of the FDA to review and approve new products, grant meeting requests or process other requests in timely fashion can be affected by a variety of factors, including government budget and funding levels and statutory, regulatory and policy changes. As a result of such factors, average review times at the FDA have fluctuated in recent years. Disruptions at the FDA and other agencies may also slow the time necessary for new product candidates to be reviewed and/or approved by necessary government agencies, which would adversely affect business operations of regulated entities. In addition, government funding of the SEC and other government agencies on which our operations may rely is subject to the political process, which is inherently fluid and unpredictable.
Disruptions at the FDA and other agencies may also slow the time necessary for new product candidates to be reviewed and/or approved by necessary government agencies. Further, future government shutdowns could impact the ability to access the public markets and obtain necessary capital in order to properly capitalize and continue our operations.
Major public health issues, such as pandemics, could have an adverse effect on our clinical trials, financial condition, results of operations, and other aspects of our business.
| ● | delays or difficulties in clinical site initiation, including difficulties in recruiting clinical sites, and delays enrolling patients in our clinical trials or increased rates of patients withdrawing from our clinical trials following enrollment; |
| ● | diversion of healthcare resources, including clinical trial investigators and staff, away from the conducting of clinical trials to focus on pandemic concerns which could result in delays to our partner companies’ clinical trials; |
| ● | limitations on travel, including limitations on domestic and international travel, and government-imposed quarantines or restrictions imposed by key third parties that could interrupt key trial activities, such as clinical trial site initiations and monitoring; |
| ● | interruption of, or delays in receiving, supplies of our product candidates from our contract manufacturing organizations due to staffing shortages, or production slowdowns or stoppages; |
| ● | disruptions and delays caused by potential workplace, laboratory and office closures and an increased reliance on employees working from home across the healthcare system; and |
| ● | disruptions in or delays to regulatory approvals, inspections, reviews or other regulatory activities affecting the operations of the FDA or other regulatory authorities. |
We rely on third parties for certain functions or services in support of our clinical trials and key areas of our operations. If these third parties themselves are adversely impacted by restrictions resulting from major public health issues, we will likely experience delays and/or realize additional costs. As a result, our ability to commence and complete clinical trials in a timely fashion, obtain regulatory approvals for, and to commercialize, our current and future product candidates may be delayed or disrupted.
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Risks Related to the Development of our Product Candidates
Development of our products may take a long time and may never lead to marketable products.
The feasibility of our product candidates to be the subject of a marketing application, including the feasibility and time required to conduct the clinical trials that may support a marketing application, are inherently uncertain and subject to multiple factors such as the size of the patient population, patient recruitment, satisfactory safety and efficacy data, the ability to manufacture phase-appropriate drug substance and drug product, and other regulatory requirements. If we are unable to effectively identify patients, unable or delayed in manufacturing phase-appropriate drug substance or drug product, or aren’t able to meet the regulatory standards for any portion of our development program, we will not be able to, or be substantially delayed in, conducting clinical trials in support of a marketing application and potential approvals of our product candidates and our business will suffer.
We are substantially dependent on our ability to advance NXP100, NXP200, NXP900 or any of our other future product candidates through preclinical and clinical development, identify safe and effective doses and dosing schedules for our drug candidates, obtain regulatory approval and ultimately commercialize NXP100, NXP200, NXP900 or any of our other future product candidates; if we experience delays in doing so, our business will be materially harmed.
Our ability to generate product revenues from NXP100, NXP200, NXP900 or any of our other future product candidates depends heavily on the successful clinical development and eventual commercialization of these drug candidates. In addition, our drug development programs may contemplate the development of companion diagnostics, which are assays or tests to identify an appropriate patient population based on genetic mutations and other alterations. Companion diagnostics are subject to regulation as medical devices and must themselves receive marketing authorization from the FDA or certain other foreign regulatory agencies before they may be marketed. If a companion diagnostic is essential to the safe and effective use of any of our current and future product candidates, the FDA may require that the companion diagnostic meets the applicable standard for safety and effectiveness or for substantial equivalence for use with our product candidates before either the product candidates or companion diagnostic may be marketed in the United States.
Negative preclinical or clinical results in the development of our product candidates may prevent or delay our ability to advance our product candidates, initiate or continue clinical programs or receive regulatory approvals. For example, although we believe, based on preclinical studies of SRC/YES1 related carcinoma models that demonstrated tumor growth inhibition, these cancer types might be particularly sensitive to treatment with NXP900, this may not prove true in clinical testing, due to safety and tolerability issues and/or insufficient efficacy, and this may hold true for any or all of the potential target indications that we are pursuing or will pursue in the future with our product candidates. Moreover, anti-tumor activity may be different in each tumor type that we plan to evaluate in clinical trials. As a result, we may be required to discontinue development of our drug candidates or invest significant additional resources and delay our clinical trials and ultimately the approval, if any, of any of our other future product candidates.
Our current or future product candidates may not show favorable results in early clinical trials due to safety, tolerability and/or insufficient efficacy findings. In addition, positive results of early clinical trials are not necessarily predictive of future results, and any product candidate that we advance may not have favorable results in later clinical trials or receive regulatory approval. For example, following a preliminary analysis of safety and efficacy data results from the Phase 1b study of NXP800 in platinum-resistant ARID1a-mutated ovarian carcinoma, we decided to cease the clinical development of NXP800 in this indication.
We may experience setbacks that could delay or prevent regulatory approval of, or our ability to commercialize, NXP100, NXP200 and NXP900, or future product candidates, including:
| ● | negative or inconclusive preclinical or clinical results, including adverse safety findings and efficacy findings; |
| ● | approval of competing product candidates based on clinical trial results generated by others; |
| ● | a decision by us or requirement by regulatory authorities to conduct additional preclinical testing or clinical trials or abandon a program; |
| ● | adverse events or side effects experienced by patients or subjects in our clinical trials that we, the FDA, or other regulators may view as relevant to the development of our current or future product candidates; |
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| ● | issues related to combination regimens, including tolerability concerns, drug-drug interactions, or lack of efficacy; |
| ● | delays in submitting IND applications or comparable foreign applications or delays or failure in obtaining the necessary approvals from regulators to commence a clinical trial, or a suspension or termination of a clinical trial once commenced; |
| ● | requirements imposed by the FDA or comparable foreign authorities regarding the scope and design of our clinical trials, including our clinical endpoints; |
| ● | delays in enrolling subjects in clinical trials, including difficulty or delays in identifying appropriate patients, and timely completion of clinical trials, including under GCP or GLP requirements; |
| ● | inability to maintain compliance with regulatory requirements, including our contract manufacturers’ compliance with cGMPs, and complying effectively with other requirements pertaining to the quality of our current or future product candidates; |
| ● | high drop-out rates of subjects from clinical trials due to safety and tolerability issues or insufficient efficacy; |
| ● | inadequate supply or quality of our current or future product candidates or other materials necessary for the clinical trials and to satisfy analytical testing requirements necessary for drug approval; |
| ● | higher than anticipated clinical trial costs; |
| ● | competitive developments by others in our target indications; |
| ● | insufficient efficacy, safety, or tolerability concerns, or the requirement to modify dosing levels for our current or future product candidates; |
| ● | trial results taking longer than anticipated; |
| ● | trials being subjected to fraud or data integrity issues or operational failures that compromises trial data; |
| ● | the results of our trials not supporting marketing authorization outside of the United States, including the European Union; |
| ● | unfavorable FDA or other regulatory agency inspection of a clinical trial site; |
| ● | failure of our third-party contractors or investigators to comply with regulatory requirements or otherwise meet their contractual obligations in a timely manner, or at all; |
| ● | delays and changes in regulatory requirements, policy and guidelines, including the imposition of additional regulatory oversight around clinical development generally or with respect to our technology in particular; or |
| ● | varying interpretations of data by the FDA and similar foreign regulatory agencies. |
In addition, because we have limited financial and personnel resources and are focusing primarily on developing NXP100, NXP200 and NXP900, we may forgo or delay pursuit of other future product candidates that may prove to have greater commercial potential and may fail to capitalize on viable commercial products or profitable market opportunities. If we do not accurately evaluate the commercial potential or target market for a future product candidate, we may relinquish valuable rights to those future product candidates through collaboration, licensing, or other royalty arrangements in cases in which it would have been more advantageous for us to retain sole development and commercialization rights to such future product candidates.
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Clinical drug development involves a lengthy and expensive process with uncertain outcomes, clinical trials are difficult to design and implement, and any of our clinical trials could produce unsuccessful results or fail at any stage in the process.
Clinical trials are conducted on humans, are expensive, can take many years to complete, and outcomes are inherently uncertain. Failure can occur at any time during the process. Additionally, any positive results of preclinical studies and early clinical data of a drug candidate may not be predictive of the final results of the early clinical trial or of later-stage clinical trials. Drug candidates may not reach later-stage clinical trials based on results from an early-stage clinical trial or may reach later stages of clinical trials and fail to show the desired safety and efficacy traits despite having shown indications of those traits in preclinical studies and early-stage clinical trials. A number of companies in the pharmaceutical industry have suffered significant setbacks in early and advanced clinical trials due to lack of efficacy or adverse safety profiles, notwithstanding promising results in preclinical studies or preliminary clinical findings. Therefore, the results of any existing and future clinical trials we conduct may not be successful. Clinical trials may be delayed, suspended or prematurely terminated because costs are greater than we anticipate or for a variety of reasons, such as:
| ● | delay or failure in reaching agreement with the FDA or a comparable foreign regulatory authority on a clinical trial design that we are able to execute; |
| ● | delay or failure in obtaining authorization to commence a clinical trial, including approval from the appropriate institutional review board (“IRB”) to conduct testing of a candidate on human subjects, or inability to comply with conditions imposed by a regulatory authority regarding the scope or design of a clinical trial; |
| ● | delay in reaching, or failure to reach, agreement on acceptable terms with prospective CROs and clinical trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and clinical trial sites; |
| ● | inability, delay or failure in identifying and maintaining a sufficient number of clinical trial sites, many of which may already be engaged in other clinical programs; |
| ● | delay or failure in identifying, recruiting and enrolling suitable volunteers or patients to participate in a trial; |
| ● | delay or failure in developing and validating companion diagnostics, if they are deemed necessary, on a timely basis; |
| ● | failure of patients to complete a trial or return for post-treatment follow-up; |
| ● | inability to monitor patients adequately during or after treatment; |
| ● | clinical sites and investigators deviating from trial protocols, failing to conduct the trial in accordance with regulatory requirements or dropping out of a trial; |
| ● | failure to initiate, delay of, or inability to complete a clinical trial as a result of a clinical hold imposed by the FDA or comparable foreign regulatory authority due to observed safety findings or other reasons; |
| ● | negative or inconclusive results in our clinical trials, and our decision to our regulators’ requirement that we conduct additional preclinical studies, clinical trials or that we abandon one or more of our product development programs; or |
| ● | inability to manufacture sufficient quantities of a drug candidate of acceptable quality for use in clinical trials. |
We rely, and plan to continue to rely, on CROs, contract manufacturing organizations (“CMOs”) and clinical trial sites to ensure the proper and timely conduct of our clinical trials. Although we have and expect that we will have agreements in place with CROs and CMOs governing their contracted activities and conduct, we will have limited influence over their actual performance. As a result, we ultimately do not and will not have control over a CRO’s or CMO’s compliance with the terms of any agreement it may have with us, its compliance with applicable regulatory requirements, or its adherence to agreed-upon time schedules and deadlines, and a future CRO’s or CMO’s failure to perform those obligations could subject any of our clinical trials to delays or failure.
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Further, we may also encounter delays if a clinical trial is suspended, is put on clinical hold or terminated by us, by any IRB or ethics committee, by a Data Safety Monitoring Board, or by the FDA or European Medicines Agency (“EMA”), or other regulatory authority. A suspension or termination may be due to a number of factors, including failure to conduct the clinical trial in accordance with regulatory requirements, inspection of the clinical trial operations or trial site by the FDA, EMA or other regulatory authorities, exposing participants to health risks caused by unforeseen safety issues or adverse side effects, development of previously unseen safety issues, failure to demonstrate a benefit from using a drug candidate, or changes in governmental regulations or administrative actions. Therefore, we cannot predict with any certainty the schedule for commencement or completion of any currently ongoing, planned or future clinical trials.
Many of the factors that cause, or lead to, a delay in the commencement or completion of clinical trials may also ultimately lead to the denial of marketing approval for our current or future product candidates.
If we experience delays in the commencement or completion of, or suspension, hold or termination of, any clinical trial for our drug candidates, the commercial prospects of the drug candidate could be harmed, and our ability to generate product revenues from the drug candidate may be delayed or eliminated. In addition, any delays in completing our clinical trials will increase our costs, slow down our drug candidate development and approval process and jeopardize regulatory approval of our drug candidates and our ability to commence sales and generate revenues. The occurrence of any of these events could harm our business, financial condition, results of operations and prospects significantly.
Difficulty in enrolling patients could delay or prevent clinical trials of our current or future product candidates.
Identifying and qualifying patients to participate in clinical studies of our current or future product candidates is critical to our success. The timing of completion of our clinical studies depends in part on the speed at which we can recruit patients to participate in testing our current or future product candidates and we may experience delays in our clinical trials if we encounter difficulties in enrollment. Further, because we are currently focused on patients with specific and rare diseases, our ability to enroll eligible patients may be limited and may result in slower enrollment than we anticipate. Our clinical trials will compete with other clinical trials for current or future product candidates that are in the same therapeutic areas as our current or future product candidates, which may reduce the number and types of patients available to us.
Clinical trials may be subject to delays as a result of patient enrollment taking longer than anticipated or greater than anticipated subject withdrawal. We may not be able to initiate or continue clinical trials for our current or future product candidates if we are unable to locate and enroll a sufficient number of eligible patients to participate in these trials as required by the FDA or foreign regulatory authorities. We cannot predict how successful we will be at enrolling subjects in future clinical trials. The enrollment of patients depends on many factors, including:
| ● | patient identification and eligibility and inclusion/exclusion criteria defined in the protocol, including based on the presence of specific genetic/molecular alterations; |
| ● | the size of the target disease patient population or the size of the patient population required to be enrolled for analysis of the clinical trial’s primary and secondary endpoints and the process for identifying patients; |
| ● | potential disruptions caused by major public health issues, including difficulties in initiating clinical sites, enrolling and retaining participants, diversion of health care resources away from clinical trials, travel or quarantine policies that may be implemented, and other factors; |
| ● | we are developing our drug candidates for certain rare diseases which may require us to engage clinical sites outside of the US in order to enroll appropriate patients into clinical trials. This can prolong the clinical trial process and increase the costs associated with the clinical trials |
| ● | the proximity of patients to clinical trial sites; |
| ● | the design of the trial; |
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| ● | our ability to recruit clinical trial investigators with the appropriate competencies and expertise; |
| ● | clinicians’ and patients’ perceptions as to the potential advantages and risks of the product candidate being studied in relation to other available therapies, including any new products that may be approved for the indications we are investigating; |
| ● | the availability of competing commercially available therapies and other competing product candidates’ clinical trials; |
| ● | our ability to obtain and maintain IRB approvals for clinical sites and clinical trial subject informed consents; and |
| ● | the risk that subjects enrolled in clinical trials will drop out of the trials before completion. |
If we are unable to locate and enroll sufficient eligible patients to participate, as required by the FDA or similar regulatory authorities, we may be unable to initiate or continue clinical trials for our current or future product candidates. If necessary, we intend to engage third parties to develop companion diagnostics for use in our clinical trials. If such third parties are unsuccessful, our difficulty in identifying patients with the targeted genetic mutations for our clinical trials would be increased. If we are unable to include patients with the targeted genetic mutations or patients with well-defined serious unmet medical needs, we may be unable to participate in the FDA’s expedited review and development programs, including breakthrough therapy designation and fast track designation, or otherwise seek to accelerate clinical development and regulatory timelines.
Our clinical studies, preclinical, manufacturing and other studies conducted as part of the development of our current or future product candidates may fail to adequately demonstrate the safety, potency, purity, efficacy or any other necessary pharmacological properties of any efficacy, or any other required properties of our current or future product candidates, which would prevent or delay development, regulatory approval and commercialization.
Before obtaining regulatory approvals for the commercial sale of our current or future product candidates, including NXP100, NXP200, and NXP900, we must demonstrate through lengthy, complex and expensive studies that our current or future product candidates are both safe and effective for use in each target indication. Preclinical and clinical testing are expensive and can take many years to complete, and its outcome is inherently uncertain. Failure can occur at any time during the preclinical study and clinical trial processes, and, because our current product candidates are in an early stage of development, there is a high risk of failure.
The results of preclinical studies and early clinical trials of a drug candidate may not be predictive of the final results of later-stage clinical trials. Results of our trials could reveal a high and unacceptable severity and prevalence of adverse safety issues which may result in suspension or termination, and the FDA or comparable foreign regulatory authorities could, through a clinical hold or otherwise, require us to halt or suspend further development of our product candidates or deny approval. Drug-related side effects could also affect patient recruitment into the study or patient willingness to remain in the study and therefore affect our ability to complete clinical trials. Drug-related side effects could also result in potential product liability claims. Any of these occurrences may harm our business, financial condition and prospects significantly.
Moreover, our product or product candidates may cause undesirable side effects or pharmacological properties, either as single agent treatment or in combination with approved drugs, that could delay or prevent their regulatory approval or impact their availability and commercial potential after approval.
The FDA and comparable foreign regulatory authorities may not accept data from any preclinical or clinical trials conducted in foreign countries.
The FDA’s acceptance of data generated from clinical trials conducted in whole or in part outside the United States may be subject to certain conditions, if accepted at all.
Although the FDA has the authority to accept foreign data as part of, or even the sole basis for, a marketing application, the FDA generally does so only if (i) it finds the data to be applicable to the U.S. population and U.S. medical practice, (ii) it finds that the trials were performed by clinical investigators of recognized competence and pursuant to GCP regulations, and (iii) it finds that the clinical trial were conducted in a manner that satisfies the regulatory standards. Many foreign regulatory authorities have similar approval
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requirements. In addition, any clinical study conducted in whole or in part outside of the United States would be subject to the applicable local laws of the jurisdiction where the trial was conducted. We cannot guarantee that the FDA or comparable foreign regulatory authority will accept data from trials conducted in whole or in part outside of the United States, which may result in the need for additional trials conducted in the United States.
We may not be able to submit IND applications to commence additional clinical trials based on the timelines that we expect, and even if we are able to do so, the FDA may not permit us to proceed.
Our IND for NXP900 is in effect. However, we may be unable to submit additional IND or similar applications or other clinical research on our expected timelines for NXP100 and NXP200. Moreover, while we have previously obtained Clinical Trial Application (“CTA”) and IND, we cannot be sure that issues will not arise that may lead to the delay, suspension or termination of such clinical trials. Any failure to file, IND or similar applications or other clinical research authorizations will adversely impact our expected timelines to obtain regulatory acceptance for the commencement of our trials and may prevent us from completing our clinical trials or commercializing our products on a timely basis, if at all.
We currently have no marketing and sales organization and have limited experience in marketing products. If we are unable to establish marketing and sales capabilities or enter into agreements with third parties to market and sell any approved product candidates, we may not be able to generate product revenue.
We will have to compete with other pharmaceutical and biotechnology companies to recruit, hire, train and retain marketing and sales personnel. If we are unable or decide not to establish internal sales, marketing, and distribution capabilities, we may pursue arrangements with third-party sales, marketing, and distribution collaborators regarding the sales and marketing of our products, if approved.
There can be no assurance that we will be able to develop in-house sales and distribution capabilities or establish or maintain relationships with third-party collaborators to commercialize any product in the United States or overseas.
We face substantial competition, which may result in others discovering, developing or commercializing products before or more successfully than we do.
While we believe that our scientific knowledge, technology, and development expertise provide us with competitive advantages, we face potential competition from many different sources, including major pharmaceuticals, specialty pharmaceuticals and biotechnology companies, academic institutions and government agencies, and public and private research institutes that conduct research, development, manufacturing, and commercialization. Many of our competitors have significantly greater financial resources and expertise in research and development, manufacturing, preclinical testing, regulatory approvals, and product marketing than we do. Our competitors may compete with us in recruiting and retaining qualified scientific and management personnel and establishing clinical trial sites and patient recruitment for clinical trials, as well as in acquiring technologies complementary to, or necessary for, our programs. As a result, our competitors may discover, develop, license, or commercialize products earlier or more successfully than we do.
If our product candidates, NXP100, NXP200 and NXP900, are approved, they will likely compete with competitor drugs and other drugs that are currently in development. The availability of reimbursement from government and other third-party payors will also significantly affect the pricing and competitiveness of our products. Our competitors may also obtain FDA or other regulatory approval for their products more rapidly than we do, which could result in our competitors establishing a strong market position before we are able to enter the market.
Regulatory approval of our licensed products in one jurisdiction does not ensure approval in other jurisdictions, and failure to obtain approvals in additional markets could limit our commercial opportunity.
Marketing approval for ciprocopan (NXP100) was obtained in China for the treatment of PNH, and we will seek to obtain regulatory approval for ciprocopan and our other product candidates in additional jurisdictions, including the United States, the European Union, and other markets. Regulatory authorities in different countries and regions, including the FDA, and the EMA, operate independently of one another, apply different regulatory standards and requirements, and evaluate clinical and non-clinical data, manufacturing processes, and labeling using their own respective review criteria, timelines, and procedures. Approval of ciprocopan by the NMPA does not bind, and is not predictive of, the decisions of the FDA, the EMA, or any other regulatory authority, and we may be required
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to conduct additional or different clinical trials, provide additional non-clinical or manufacturing data, or otherwise satisfy requirements that differ materially from those imposed by the NMPA in order to obtain approval in other jurisdictions.
As a result, we cannot assure investors that regulatory authorities outside of China will reach similar conclusions regarding the safety and efficacy of ciprocopan, or that we will obtain marketing approval in the United States, the European Union, or any other jurisdiction on the timeline we anticipate, or at all. Differences in patient populations, standard of care, trial design expectations, and post-approval commitments among jurisdictions may require us to generate additional clinical data at significant additional cost and delay, and there is no guarantee such data would support approval even if generated. Any delay or failure to obtain regulatory approval in jurisdictions outside of China would limit the commercial opportunity for ciprocopan and could have a material adverse effect on our business, financial condition, and results of operations.
Risks Related to Government Regulation
Denial of or delay in our receipt of required regulatory approvals may prevent or delay commercialization of our current or future product candidates and our ability to generate revenue may be materially impaired.
The research, testing, manufacturing, labeling, approval, sale, marketing and distribution of drug products are, and will remain, subject to extensive regulation by the FDA in the United States and by the respective regulatory authorities in other countries where regulations differ. We will not be permitted to market our current or future product candidates in the United States until we receive the respective approval of an NDA from the FDA, or in any foreign countries until we receive the requisite approval from the respective regulatory authorities in such countries. The time required to obtain regulatory approval, if any, by the FDA, EMA and comparable foreign authorities is unpredictable, but typically takes many years following the commencement of clinical trials and depends upon numerous factors, including the substantial discretion of the regulatory authorities and the type, complexity and novelty of the product candidates involved. Regulatory authorities have substantial discretion in the approval process and may refuse to accept any application or may decide that our data are insufficient for approval and require additional nonclinical studies or clinical trials.
Obtaining regulatory approval requires the submission of extensive nonclinical and clinical data and supporting information to regulatory authorities for each therapeutic indication to establish the product candidate’s safety and efficacy. Securing regulatory approval also requires the submission of information about the product manufacturing process, and in many cases the inspection of manufacturing, processing, and packaging facilities by the regulatory authorities. Our current or future product candidates may not be effective, may be only moderately effective or may prove to have undesirable or unintended side effects, toxicities or other characteristics that may preclude our obtaining marketing approval or prevent or limit commercial use, or there may be deficiencies in cGMP compliance by us or by our CMOs that could result in the candidate not being approved. Moreover, we have not obtained regulatory approval for any drug candidate in any jurisdiction and it is possible that none of our existing drug candidates or any drug candidates we may seek to develop in the future will ever obtain regulatory approval.
Our drug candidates could fail to receive, or could be delayed in receiving, regulatory approval for many reasons, including any one or more of the following:
| ● | the FDA, EMA or comparable foreign regulatory authorities may disagree with the design or implementation of our clinical trials; |
| ● | we may be unable to demonstrate to the satisfaction of the FDA, EMA or comparable foreign regulatory authorities that a drug candidate is safe and effective for its proposed indication; |
| ● | the results of clinical trials may not meet the level of statistical significance required by the FDA, EMA or comparable foreign regulatory authorities for approval; |
| ● | we may be unable to demonstrate that a drug candidate’s clinical and other benefits outweigh its safety risks; |
| ● | the FDA, EMA or comparable foreign regulatory authorities may disagree with our interpretation of data from preclinical studies or clinical trials; |
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| ● | the data collected from clinical trials of our drug candidates may not be sufficient to support the submission of an NDA or other submission or to obtain regulatory approval in the United States or elsewhere; |
| ● | upon review of our clinical trial sites and data, the FDA or comparable foreign regulatory authorities may find our record keeping or the record keeping of our clinical trial sites to be inadequate; |
| ● | the manufacturing processes or facilities of third-party manufacturers with which we contract for clinical and commercial supplies may fail to meet the requirements of the FDA, EMA or comparable foreign regulatory authorities; |
| ● | the FDA, EMA or comparable foreign regulatory authorities may fail to approve the companion diagnostics we contemplate developing internally or with partners; and |
| ● | the change of the medical standard of care or the approval policies or regulations of the FDA, EMA or comparable foreign regulatory authorities may significantly change in a manner that renders our clinical data insufficient for approval. |
The time and expense of the approval process, as well as the unpredictability of future clinical trial results and other contributing factors, may result in our failure to obtain regulatory approval to market NXP100, NXP200, NXP900 or any other drug candidates we may seek to develop in the future, which would significantly harm our business, results of operations and prospects. In such case, we may also not have the resources to conduct new clinical trials and we may determine that further clinical development of any such drug candidate is not justified and may discontinue any such programs.
In addition, even if we were to obtain regulatory approval in one or more jurisdictions, regulatory authorities may approve any of our drug candidates for fewer or more limited indications than we request, may not approve prices we may propose to charge for our products, may grant approval contingent on the performance of costly post-marketing clinical trials (referred to as “conditional” or “accelerated” approval depending on the jurisdiction), or may approve a drug candidate with a label that does not include the labeling claims necessary or desirable for the successful commercialization of that drug candidate. Any of the foregoing circumstances could materially harm the commercial prospects for our drug candidates.
Changes in U.S. regulatory or trade policy affecting the development or importation of drug candidates originating in China could adversely impact our development plans for NXP100 and NXP200.
NXP100 and NXP200 were in-licensed from Haisco, a China-based pharmaceutical company, and our development plans for both product candidates depend in part on our ability to receive technology transfer, know-how, and materials originating in China, and to rely on data and other information generated in connection with Haisco's China-based development activities. Changes in U.S. laws, regulations, executive orders, or government policy that make it more difficult to develop, import, or rely on drug candidates, materials, or data originating in China could adversely affect our ability to execute our development plans for NXP100 and NXP200.
Such changes could include, among others:
| ● | new or expanded export control, import restriction, or licensing requirements applicable to materials, technology, or technical data transferred from China to the United States; |
| ● | restrictions or prohibitions on U.S. persons or companies engaging in transactions, collaborations, or licensing arrangements with China-based counterparties, whether through legislation, executive order, sanctions programs, or outbound/inbound investment screening mechanisms; |
| ● | heightened FDA scrutiny of, or new requirements applicable to, clinical, nonclinical, or manufacturing data generated in China, including changes affecting the acceptability of such data in support of U.S. regulatory submissions; |
| ● | changes in FDA or other U.S. regulatory agency policy regarding inspection access to, or reliance on inspections of, manufacturing or clinical trial sites located in China; |
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| ● | imposition of tariffs, customs restrictions, or other trade barriers affecting the import of active pharmaceutical ingredients, intermediates, or finished materials sourced from China; and |
| ● | broader deterioration in U.S.-China relations resulting in legislative or administrative action specifically targeting pharmaceutical or biotechnology collaborations with China-based entities. |
Any of the foregoing could delay or prevent our ability to obtain necessary materials, technology, or data from Haisco, require us to identify alternative sources or generate duplicative data at significant additional cost and delay, or otherwise impair our ability to advance NXP100 and NXP200 on our anticipated timelines or at all. We have limited or no ability to control or predict changes in U.S. regulatory or trade policy, and we cannot assure you that our development plans will not be adversely affected by future legislative, regulatory, or administrative action targeting China-originated pharmaceutical development. Any such disruption could have a material adverse effect on our business, financial condition, and results of operations.
Obtaining and maintaining regulatory approval of our current or future product candidates in one jurisdiction does not mean that we will be successful in obtaining regulatory approval of our current or future product candidates in other jurisdictions.
Obtaining and maintaining regulatory approval of any of our current or future product candidates in one jurisdiction does not guarantee that we will be able to obtain or maintain regulatory approval in any other jurisdiction, while a failure or delay in obtaining regulatory approval in one jurisdiction may have a negative effect on the regulatory approval process in other jurisdictions. For example, even if the FDA grants regulatory approval of a product candidate, similar foreign regulatory authorities must also approve the manufacturing, marketing and promotion of the product candidate in respective countries. Drug product approval procedures vary among jurisdictions and can involve requirements and administrative review periods different from, and greater than, those in the United States, including additional preclinical studies or clinical trials as clinical trials conducted in one jurisdiction may not be accepted by regulatory authorities in other jurisdictions. In many jurisdictions outside the United States, a product candidate must be approved for reimbursement before it can be approved for sale in that jurisdiction. In some cases, the price that we intend to charge for our products is also subject to approval.
We may also submit marketing applications in other countries. Regulatory authorities in jurisdictions outside of the United States have requirements for approval of product candidates with which we must comply prior to marketing in those jurisdictions. Obtaining similar foreign regulatory approvals and compliance with similar foreign regulatory requirements could result in significant delays, difficulties and costs for us and could delay or prevent the introduction of our products in certain countries. We do not have any product candidates approved for sale in any jurisdiction, including international markets, and we do not have experience in obtaining regulatory approval in international markets. If we fail to comply with the regulatory requirements in international markets and/or receive applicable marketing approvals, our target market will be reduced and our ability to realize the full market potential of our current or future product candidates will be harmed.
Even if we receive regulatory approval of our current or future product candidates, we will be subject to ongoing regulatory obligations and regulatory review, which may result in significant additional expense and we may be subject to penalties if we fail to comply with regulatory requirements or experience unanticipated problems with our current or future product candidates.
If any of our current or future product candidates are approved, activities such as the manufacturing, labeling, packaging, storage, advertising, promotion, sampling, and record keeping for the products will be subject to extensive and ongoing regulatory requirements. These requirements include submissions of safety and other post-marketing information and reports, registration, as well as ongoing compliance with cGMP regulations. Drug manufacturers and any CMOs responsible for any product manufacturing processes are required to comply with extensive FDA and comparable foreign regulatory authority requirements, including ensuring that quality control and manufacturing procedures conform to cGMP regulations and any applicable foreign equivalents. As such, we and our CMOs will be subject to continuous review and inspections to assess compliance with cGMP and adherence to commitments made in any NDA, other marketing application, and previous responses to inspection observations. Accordingly, we and others with whom we work must continue to expend time, money, and effort in all areas of regulatory compliance, including manufacturing, production and quality control.
The FDA or a comparable foreign regulatory authority may also impose requirements for costly post-marketing nonclinical studies or clinical trials (often called “Phase 4 trials”) and post-marketing surveillance to monitor the safety or efficacy of the product. If we or a regulatory authority discover previously unknown problems with a product, such as adverse events of unanticipated severity or
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frequency, production problems or issues with the facility where the product is manufactured or processed, such as product contamination or significant non-compliance with applicable cGMP regulations, a regulator may impose restrictions on that product, the manufacturing facility or us. If we or our third-party providers, including our CMOs, fail to comply fully with applicable regulations, then we may be required to initiate a recall or withdrawal of our products.
Later discovery of previously unknown problems with our current or future product candidates, including adverse events of unanticipated severity or frequency, or with our third-party manufacturers or manufacturing processes, or failure to comply with regulatory requirements, may result in the following, among other things:
| ● | restrictions on the manufacturing of the product; |
| ● | restrictions on the labeling or marketing of a product; |
| ● | restrictions on product distribution or use; |
| ● | requirements to conduct post-marketing studies or clinical trials; |
| ● | withdrawal of the product from the market; |
| ● | product recalls; |
| ● | warning or untitled letters from the FDA or comparable notice of violations from foreign regulatory authorities; |
| ● | refusal of the FDA or other applicable regulatory authority to approve pending applications or supplements to approved applications; |
| ● | fines, restitution or disgorgement of profits or revenues; |
| ● | suspension or withdrawal of marketing approvals; |
| ● | suspension of any of our ongoing clinical trials; |
| ● | product seizure or detention or refusal to permit the import or export of products; and |
| ● | consent decrees, injunctions or the imposition of civil or criminal penalties. |
In addition, regulatory authorities’ policies (such as those of the FDA or EMA) may change and additional government regulations may be enacted that could prevent, limit or delay regulatory approval of our current or future product candidates. If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are otherwise not able to maintain regulatory compliance, we may lose any marketing approval that we may have obtained, which would adversely affect our business, prospects and ability to achieve or sustain profitability.
Non-compliance with European Union requirements regarding safety monitoring or pharmacovigilance can also result in significant financial penalties. Similarly, failure to comply with the European Union’s requirements regarding the protection of personal information can also lead to significant penalties and sanctions.
The FDA’s policies may change and additional government regulations may be enacted that could prevent, limit or delay marketing approval of our current or future product candidates. If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, this may adversely affect, or even lead to the rescission of, the marketing approval that we may have obtained, which would adversely affect our business, prospects and ability to achieve or sustain profitability.
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A variety of risks associated with marketing our current or future product candidates internationally could materially adversely affect our business.
We plan to seek regulatory approval of our current or future product candidates outside of the United States and expect that we will be subject to additional risks related to operating in foreign countries including: differing regulatory requirements; unexpected changes in tariffs, trade barriers, price and exchange controls; economic weakness, including inflation, or political instability in particular foreign economies and markets; compliance with tax, employment, immigration and labor laws for employees living or traveling abroad; foreign currency fluctuations that result in increased operating expenses, reduced revenue, and other obligations incident to doing business in another country; potential liability under the Foreign Corrupt Practices Act of 1977 or comparable foreign regulations; and challenges enforcing our contractual and intellectual property rights, especially in countries that do not recognize intellectual property rights to the same extent as the United States.
The insurance coverage and reimbursement status of newly approved products is uncertain. Our current or future product candidates may become subject to unfavorable pricing regulations, third-party coverage and reimbursement practices, or healthcare reform initiatives, which would harm our business. Failure to obtain or maintain adequate coverage and reimbursement for new or current products could limit our ability to market those products and decrease our ability to generate revenue.
Adverse pricing limitations may hinder our ability to recoup our investment in one or more of our current or future product candidates, even if any such current or future product candidate we may develop obtains marketing approval.
Our ability to successfully commercialize any current or future product candidates will depend in part on the coverage and reimbursement for the products and related treatments from government health administration authorities and third-party payors, such as private health insurers and health maintenance organizations. These organizations decide which medications they will pay for and establish reimbursement levels. If coverage and adequate reimbursement are not available, or the approved reimbursement amount is not high enough, we may be unable to establish or maintain pricing sufficient to generate a return on our investment and may be unable to successfully commercialize our current or future product candidates. Reimbursement by a third-party payor may depend upon a number of factors, including, but not limited to, the third-party payor’s determination that use of a product is a covered benefit under its health plan, safe, effective and medically necessary, appropriate for the specific patient, cost-effective, and neither experimental nor investigational. If coverage and adequate reimbursement are not available, or the approved reimbursement amount is not high enough, we may be unable to establish or maintain pricing sufficient to generate a return on our investment and may be unable to successfully commercialize our current or future product candidates.
A primary trend in the U.S. healthcare industry and elsewhere is cost containment. Government authorities and third-party payors have attempted to control costs by limiting coverage and the amount of reimbursement for particular medications. In general, the prices of medicines under such systems are substantially lower than in the United States.
There is also significant uncertainty related to the insurance coverage and reimbursement of newly approved products, and coverage may be more limited than the purposes for which the medicine is approved by the FDA or comparable foreign regulatory authorities. In the United States, the principal decisions about reimbursement for new medicines are typically made by CMS. As a result, the coverage determination process is often a time consuming and costly process that may require us to provide scientific and clinical support for the use of our products to each payor separately, with no assurance that coverage and adequate reimbursement will be applied consistently or obtained in the first instance. It is difficult to predict what CMS will decide with respect to reimbursement for fundamentally novel products such as ours. Reimbursement agencies in Europe may be more conservative than CMS. Our inability to promptly obtain coverage and profitable payment rates from both government-funded and private payors for any approved products we may develop could have a material adverse effect on our operating results, our ability to raise capital needed to commercialize our current or future product candidates, and our overall financial condition.
Healthcare legislative measures and changes in policies, funding, staffing and leadership at the FDA and other agencies could hinder or prevent the commercial success of our products.
In the United States, there have been a number of legislative and regulatory changes to the healthcare system that could affect our future results of operations and the future results of operations of our potential customers.
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In recent years, there has been heightened governmental scrutiny over the manner in which biopharmaceutical manufacturers set prices for their marketed products, which has resulted in several recent government inquiries as well as federal and state legislation designed to, among other things, increase drug price transparency, review the relationship between pricing and manufacturer patient programs, reduce the cost of drugs under Medicare, and reform government reimbursement for drug products. Congress and the executive branch have each indicated that they will continue to seek new legislative and/or administrative measures to control drug costs, making this area subject to ongoing uncertainty. At the state level in the United States, legislatures have also increasingly passed legislation and implemented regulations designed to control drug product pricing.
While we cannot predict what impact these laws or policies will have in general or specifically on any product we may commercialize in the future, such efforts by the government and payors may result in downward pressure on reimbursement, which could negatively affect market acceptance of new products. Any rebates, discounts, taxes costs or regulatory or systematic changes on healthcare may have a significant effect on our profitability in the future.
Given recent federal and state government initiatives directed at lowering the total cost of healthcare, the executive branch, Congress and state legislatures will likely continue to focus on healthcare reform and the reform of the Medicare and Medicaid programs. While we cannot predict the full outcome of any such government action or legislation, it may harm our ability to market our products and generate revenues.
Furthermore, regulatory authorities’ assessment of the data and results required to demonstrate safety and effectiveness can change over time and can be affected by many factors, such as the emergence of new information, including on other products, changing policies and agency funding, staffing and leadership. We cannot be sure whether future changes to the regulatory environment will be favorable or unfavorable to our business prospects.
Recent efforts by the Trump Administration, including the One Big Beautiful Bill Act, to reduce government spending include reductions in FDA’s workforce. This may impact the FDA’s ability to approve current or future products and could delay regulatory approval of our current or future product candidates. This could delay commercialization of our products.
Our future relationships with customers and third-party payors in the United States and elsewhere may be subject to applicable anti-kickback, fraud and abuse, false claims, transparency, health information privacy and security and other healthcare laws and regulations, which could expose us to criminal sanctions, civil penalties, contractual damages, reputational harm, administrative burdens, diminished profits and future earnings.
Healthcare providers, physicians and third-party payors in the U.S. and elsewhere will play a primary role in the recommendation and prescription of any current or future product candidates for which we obtain marketing approval. Our future arrangements with third-party payors and customers may expose us to broadly applicable fraud and abuse and other healthcare laws and regulations, including, without limitation, the federal Anti-Kickback Statute and the federal False Claims Act, which may constrain the business or financial arrangements and relationships through which we sell, market and distribute any current or future product candidates for which we obtain marketing approval. In addition, we may be subject to transparency laws and patient privacy regulation by the federal and state governments and by governments in foreign jurisdictions in which we conduct our business. The applicable federal, state and foreign healthcare laws and regulations that may affect our ability to operate include, but are not necessarily limited to:
| ● | the federal Anti-Kickback Statute, which prohibits, among other things, persons from knowingly and willfully soliciting, offering, receiving or providing remuneration, directly or indirectly, in cash or in kind, to induce or reward, or in return for, either the referral of an individual for, or the purchase, order or recommendation of, any good or service, for which payment may be made under federal and state healthcare programs, such as Medicare and Medicaid; |
| ● | federal civil and criminal false claims laws and civil monetary penalty laws, including the federal False Claims Act, which impose criminal and civil penalties, including civil whistleblower or qui tam actions, against individuals or entities for knowingly presenting, or causing to be presented, to the federal government, including the Medicare and Medicaid programs, claims for payment that are false or fraudulent or making a false statement to avoid, decrease or conceal an obligation to pay money to the federal government; the federal Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), which imposes criminal and civil liability for executing a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters; |
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| ● | HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009, and their respective implementing regulations, which impose obligations on covered healthcare providers, health plans, and healthcare clearinghouses, as well as their business associates that create, receive, maintain or transmit individually identifiable health information for or on behalf of a covered entity, with respect to safeguarding the privacy, security and transmission of individually identifiable health information; |
| ● | the federal Open Payments program, which requires manufacturers of certain drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program, with specific exceptions, to report annually to CMS, information related to “payments or other transfers of value” made to “covered recipients,” which include physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors, and teaching hospitals) and applicable manufacturers. Applicable group purchasing organizations also are required to report annually to CMS the ownership and investment interests held by the physicians and their immediate family members. The SUPPORT for Patients and Communities Act added to the definition of covered recipient practitioners including physician assistants, nurse practitioners, clinical nurse specialists, certified registered nurse anesthetists and certified nurse-midwives effective in 2022. Data collection began on August 1, 2013 with requirements for manufacturers to submit reports to CMS by March 31, 2014 and 90 days after the end of each subsequent calendar year. Disclosure of such information was made by CMS on a publicly available website beginning in September 2014; and |
| ● | analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third-party payors, including private insurers; state and foreign data privacy or data protection laws and regulations, such as state health data privacy legislation, state data breach legislation, or general state privacy legislation such as California’s Consumer Privacy Act (CCPA) and its implementing regulations; state and foreign laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government or otherwise restrict payments that may be made to healthcare providers; state and foreign laws that require drug manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures; and state and foreign laws governing the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts. |
Efforts to ensure that our business arrangements with third parties will comply with applicable healthcare laws and regulations may involve substantial costs. It is possible that governmental authorities will conclude that our business practices may not comply with current or future statutes, regulations or case law involving applicable fraud and abuse or other healthcare laws and regulations. If our operations are found to be in violation of any of these laws or any other governmental regulations that may apply to us, we may be subject to significant civil, criminal and administrative penalties, including, without limitation, damages, fines, imprisonment, exclusion from participation in government healthcare programs, such as Medicare and Medicaid, and the curtailment or restructuring of our operations, which could have a material adverse effect on our businesses. If any of the physicians or other healthcare providers or entities with whom we expect to do business, including our collaborators, is found not to be in compliance with applicable laws, it may be subject to criminal, civil or administrative sanctions, including exclusions from participation in government healthcare programs, which could also materially affect our businesses.
If we fail to comply with environmental, health and safety laws and regulations, we could become subject to fines or penalties or incur costs that could have a material adverse effect on the success of our business.
We are subject to numerous environmental, health and safety laws and regulations, including those governing laboratory procedures and the handling, use, storage, treatment and disposal of hazardous materials and wastes. Our operations may involve the use of hazardous and flammable materials, including chemicals and biological and radioactive materials. Our operations also may produce hazardous waste products. We currently contract with third parties for the conduct of our manufacturing efforts and preclinical studies and clinical trials and such third parties are responsible for disposal of these materials and wastes. However, we cannot eliminate our risk of contamination or injury from these materials. In the event of contamination or injury resulting from our use of hazardous materials, we could be held liable for any resulting damages, and any liability could exceed our resources. We also could incur significant costs associated with civil or criminal fines and penalties.
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Although we maintain workers’ compensation insurance to cover us for costs and expenses, we may incur due to injuries to our employees resulting from the use of hazardous materials, this insurance may not provide adequate coverage against potential liabilities. We do not maintain insurance for environmental liability or toxic tort claims that may be asserted against us in connection with our storage or disposal of biological, hazardous or radioactive materials.
Risks Related to our Intellectual Property
We currently hold a license to certain intellectual property rights relating to our product candidates, NXP100, NXP200 and NXP900, as well as intellectual property rights relating to other compounds that modulate the SRC and YES1 kinases. If we are unable to maintain patent and other intellectual property protection for NXP100, NXP200 and NXP900, and to obtain and maintain patent and other intellectual property protections for our other current or future product candidates and technology, or if the scope of intellectual property protection obtained or maintained is not sufficiently broad, our competitors could develop and commercialize products and technology similar or identical to ours, and our ability to commercialize NXP100, NXP200, NXP900, or any other current or future product candidates or technology may be adversely affected.
Our success depends in large part on our ability to obtain and maintain patent and other intellectual property protection in the United States and other countries with respect to our current or future product candidates, their respective components, formulations, combination therapies, methods used to manufacture them and methods of treatment and development that are important to our business, as well as successfully defending these patents against third-party challenges. If we do not adequately protect our intellectual property rights, or if the intellectual property rights we are able to obtain are insufficiently broad and exclusive, competitors may be able to erode or negate any competitive advantage we may have, which could harm our business and ability to achieve profitability.
We intend to rely upon a combination of patents, patent applications, confidentiality agreements, trade secret protection and license agreements to protect the intellectual property related to our current or future product candidates and technologies. Any disclosure to or misappropriation by third parties of our confidential proprietary information could enable competitors to quickly duplicate or surpass our technological achievements, thus eroding our competitive position in our market. We, or any current or future partners, collaborators, or licensees, may fail to identify patentable aspects of inventions made in the course of development and commercialization activities before it is too late to obtain patent protection on them. We may be also unable to exclusively license relevant technology and associated intellectual property developed by others. Therefore, we may miss potential opportunities to establish our patent position.
If we are unable to secure additional patent protection or maintain existing or future patent protection with respect to NXP100, NXP200, NXP900, or any other proprietary products and technology we develop, our business, financial condition, results of operations, and prospects would be materially harmed.
We currently hold a license to certain intellectual property relating to NXP100, NXP200 and NXP900.
We have licensed one patent family covering the composition of matter for NXP100, NXP200 and NXP900, which have been granted in key territories including the U.S., EU, Japan, and China. The statutory expiration for patents is March 2042 for NXP100, July 2042 for NXP200 and April 2036 for NXP900, without considering any possible patent term extension.
If the scope of our patent protection, whether now or in the future, with respect to NXP100, NXP200, NXP900, or our future product candidates and technology is not sufficiently broad, we will be unable to prevent others from using our technology or from developing or commercializing technology and products similar or identical to ours or other competing products and technologies. Any failure to obtain or maintain patent protection, through our own patents or through in-licensing, with respect to NXP100, NXP200, NXP900 and our future product candidates would have a material adverse effect on our business, financial condition, results of operations and prospects.
Even if they are unchallenged, our patent applications, if issued, and any patents we may own or in-license now or in the future, may not provide us with any meaningful protection or prevent competitors from designing around our patent claims to circumvent any patents we may own or in-license in the future by developing similar or alternative technologies or therapeutics in a non-infringing manner. If the patent protection provided by our patent applications or any patents we may pursue with respect to our current or future product candidates is not sufficiently broad to impede competition, our ability to successfully commercialize our current or future product candidates could be negatively affected, which would harm our business.
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Additionally, we cannot be certain that the claims in our patent applications covering composition of matter (or other related aspects) of our current or future product candidates or technology will be considered patentable by the USPTO, or by patent offices in foreign countries, or that the claims in any issued patents we may own or in-license in the future will be considered patentable by courts in the United States or foreign countries.
The issuance of a patent does not foreclose challenges to its inventorship, scope, validity or enforceability. Therefore, our owned and in-licensed patents may be challenged in the courts or patent offices in the United States and elsewhere. Such challenges may result in loss of exclusivity or freedom to operate or in patent claims being narrowed, invalidated, or held unenforceable, in whole or in part. Successful patent challenges could limit our ability to stop others from using or commercializing similar or identical technology and products or limit the duration of the patent protection of our technology and products. Given the amount of time required for the development, testing and regulatory review of new product candidates, patents protecting such product candidates might expire before or shortly after such product candidates are commercialized. As a result, our owned and in-licensed patents may not provide us with sufficient rights to exclude others from commercializing products similar or identical to ours.
Moreover, patents or patent applications owned or filed by us, or by our licensors or other collaborators, may be challenged or narrowed by third-party pre-issuance submissions of prior art to the USPTO, or by opposition, derivation, reexamination, inter parties review, post-grant review or interference proceedings. An adverse determination in any such submission, Patent Trial and Appeal Board trial, proceeding or litigation could reduce the scope of, render unenforceable, or invalidate, our patent rights, allow third parties to commercialize our technology or products and compete directly with us, without payment to us, or result in our inability to manufacture or commercialize products without infringing third party patent rights. In addition, if the breadth or strength of protection provided by our patents and patent applications is threatened, it could dissuade companies from collaborating with us to license, develop or commercialize current or future product candidates.
If we fail to comply with our obligations in our current license agreements, or in any future agreements under which we may license intellectual property rights from third parties or otherwise experience disruptions to our business relationships with our current or future licensors, we could lose license rights that are important to our business.
We are currently a party to licenses which grant us certain intellectual property rights relating to NXP100, NXP200 and NXP900. These agreements impose numerous obligations on us to maintain our licensing rights, including development, diligence, payment, commercialization, funding, milestone, royalty, sublicensing, insurance, patent prosecution, enforcement and other obligations. In spite of our efforts, our licensor might conclude that we have materially breached our license agreement and might therefore terminate the license agreement, thereby removing or limiting our ability to develop and commercialize NXP100, NXP200 or NXP900 (and other compounds covered by the licenses).
Additionally, in the future, we may be party to other license or collaboration agreements with third parties to advance our research or allow commercialization of current or future product candidates. Such future agreements may impose numerous obligations, such as development, diligence, payment, commercialization, funding, milestone, royalty, sublicensing, insurance, patent prosecution, enforcement and other obligations on us and may require us to meet development timelines, or to exercise commercially reasonable efforts to develop and commercialize licensed products, in order to maintain the licenses. In spite of our efforts, our future licensors might conclude that we have materially breached our future license agreements and might terminate the license agreements, thereby removing or limiting our ability to develop and commercialize products and technologies covered by these license agreements.
Any termination of these current or future licenses, or failure of the underlying patents to provide the intended exclusivity, could result in the loss of significant rights and could harm our ability to commercialize our current or future product candidates, and competitors or other third parties would have the freedom to seek regulatory approval of, and to market, products identical to ours and we may be required to cease our development and commercialization of certain of our current or future product candidates. Any of the foregoing could have a material adverse effect on our competitive position, business, financial conditions, results of operations, and prospects.
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If we are unable to protect the confidentiality of our trade secrets, our business and competitive position would be harmed.
In addition to the protection afforded by patents we may own or in-license in the future, we seek to rely on trade secret protection, confidentiality agreements, and license agreements to protect proprietary know-how that is not patentable, processes for which patents are difficult to enforce, and any other elements of our product discovery and development processes that involve proprietary know-how, information, or technology that is not covered by patents. Although we require all of our employees, consultants, advisors and any third parties who have access to our proprietary know-how, information, or technology to enter into confidentiality agreements, trade secrets can be difficult to protect and we have limited control over the protection of trade secrets used by our collaborators and suppliers.
If we are unable to prevent unauthorized material disclosure of our intellectual property to third parties, we will not be able to establish or maintain a competitive advantage in our market, which could materially adversely affect our business, financial condition, results of operations and future prospects.
Additionally, since we rely on licenses from third parties, those licensors control prosecution and maintenance of the underlying patents or other IP. As a result, we as the licensee may have limited or no ability to compel the licensors to take enforcement action against third-party infringers. If the licensors fail to maintain or defend the intellectual property, our competitive position could be harmed.
Third-party claims of intellectual property infringement, misappropriation or other violations may be costly and time consuming and may prevent or delay our product discovery and development efforts.
The intellectual property landscape around precision medicine is crowded, and third parties may initiate legal proceedings alleging that we are infringing, misappropriating, or otherwise violating their intellectual property rights; the outcome of which would be uncertain and could have a material adverse effect on the success of our business. We or any of our future licensors or strategic partners may be party to, exposed to, or threatened with, future adversarial proceedings or litigation by third parties having patent or other intellectual property rights alleging that our current or future product candidates and/or proprietary technologies infringe, misappropriate or otherwise violate their intellectual property rights. Thus, because of the large number of patents issued and patent applications filed in our fields, there may be a risk that third parties may allege they have patent rights encompassing our current or future product candidates, technologies or methods.
Third parties may assert that we are employing their proprietary technology without authorization. In addition, because some patent applications in the United States may be maintained in secrecy until the patents are issued, patent applications in the United States and many foreign jurisdictions are typically not published until 18 months after filing, and publications in the scientific literature often lag behind actual discoveries, we cannot be certain that others have not filed patent applications covering our current or future product candidates or technology. If any such patent applications issue as patents, and if such patents have priority over patent applications or patents we own or in-license, we may be required to obtain rights to such patents owned by third parties which may not be available on commercially reasonable terms or at all, or may only be available on a non-exclusive basis.
In the event of a successful claim of infringement, misappropriation or other violation against us, we may have to pay substantial damages, including treble damages and attorneys’ fees for willful infringement, obtain one or more licenses from third parties, pay royalties or redesign our infringing products, which may be impossible or require substantial time and monetary expenditure.
Changes to patent law in the United States and in foreign jurisdictions could diminish the value of patents in general, thereby impairing our ability to protect our products.
Our success is heavily dependent on intellectual property, particularly patents. Recent U.S. Supreme Court rulings have narrowed the scope of patent protection available in certain circumstances and weakened the rights of patent owners in certain situations. In addition to increasing uncertainty with regard to our ability to obtain patents in the future, this combination of events has created uncertainty with respect to the value of patents, once obtained. Laws and regulations governing patents could further change in unpredictable ways that could weaken our ability to obtain new patents or to enforce patents that we own or in-license now, or that we might obtain or in-license in the future.
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We may be subject to claims challenging the inventorship or ownership of our intellectual property, including any patents we may own or in-license currently or in the future.
We may be subject to claims that former employees, collaborators or other third parties have an interest in any patents we may own or in-license currently or in the future, trade secrets, or other intellectual property as an inventor or co-inventor. Litigation may be necessary to defend against these and other claims challenging inventorship of any patents we may own or in-license in the future, trade secrets or other intellectual property, which may require substantial time and monetary expenditure.
We may be subject to claims that we or our employees, consultants or independent contractors have wrongfully used or disclosed confidential information or alleged trade secrets of third parties or competitors or breached non-competition or non-solicitation agreements with our competitors.
We may be subject to claims that we or our employees, consultants or independent contractors have inadvertently or otherwise used or disclosed confidential information or trade secrets of third parties or competitors or our employees’ former employers or our consultants’ or contractors’ current or former clients or customers. Litigation or arbitration may be necessary to defend against these claims, which may require substantial time and monetary expenditure.
If we do not obtain patent term extension and data exclusivity for any of our current or future product candidates we may develop, our business may be materially harmed.
Depending upon the timing, duration and specifics of any FDA marketing approval of any of our current or future product candidates we may develop, one or more U.S. patents we may own or in-license in the future may be eligible for limited patent term extension under the Drug Price Competition and Patent Term Restoration Act of 1984, or the Hatch-Waxman Act. If we are unable to obtain patent term extension or data exclusivity, or the term of any such extension is shorter than what we request, our competitors may obtain approval of competing products following expiration of any patents that issue from our patent applications, and our business, financial condition, results of operations, and prospects could be materially harmed.
If our trademarks and trade names are not adequately protected, we may not be able to build name recognition in our marks of interest and our business may be adversely affected.
Our trademarks or trade names may be challenged, infringed, diluted, circumvented or declared generic or determined to be infringing on other marks. We intend to rely on both registration and common law protection for our trademarks. We may not be able to protect our rights to these trademarks and trade names or may be forced to stop using these names, which we need for name recognition by potential partners or customers in our markets of interest. If we are unable to obtain a registered trademark or establish name recognition based on our trademarks and trade names, we may not be able to compete effectively and our business may be adversely affected.
Risks Related to our Reliance on Third Parties
We plan to rely on third parties to conduct our preclinical studies and clinical trials. If these third parties do not properly and successfully carry out their contractual duties or meet expected deadlines, we may not be able to obtain regulatory approval of or commercialize our current or future product candidates.
We plan to utilize and depend upon independent investigators and collaborators, such as medical institutions, CROs, CMOs, and strategic partners to conduct and support our preclinical studies and clinical trials under agreements with us. We rely upon, and plan to continue to rely upon, such third-party entities to execute our clinical trials and preclinical studies and to monitor and manage data produced by and relating to those studies and trials. However, in the future we may not be able to establish arrangements with CROs when needed or on terms that are acceptable to us, or at all, which could negatively affect our development efforts with respect to our drug candidates and materially harm our business, operations and prospects. As a result of the use of third-party contractors, we will have only limited control over certain aspects of their activities. Nevertheless, we are responsible for ensuring that each of our studies, including each of our clinical trials, is conducted in accordance with the applicable protocol, legal and regulatory requirements as well as scientific standards, and our reliance on any third-party entity will not relieve us of our regulatory responsibilities.
Based on our present expectations, we and our third-party contractors will be required to comply with GCP and GLP regulations for the clinical development of all of our drug candidates. If we or any of these third parties fail to comply with applicable GLP or GCP
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regulations, the clinical data generated in our preclinical and clinical trials may be deemed unreliable and the FDA or comparable foreign regulatory authorities may require us to perform additional clinical trials before approving our marketing applications, which we may not have sufficient cash or other resources to support and which would delay our ability to generate revenue from future sales of such drug candidate. Any agreements governing our relationships with CROs or other contractors with whom we currently engage or may engage in the future may provide those outside contractors with certain rights to terminate a clinical trial under specified circumstances. If such an outside contractor terminates its relationship with us during the performance of a clinical trial, we would be forced to seek an engagement with a substitute contractor, which we may not be able to do on a timely basis or on commercially reasonable terms, if at all, and the applicable clinical trial would experience delays or may not be completed.
Large-scale clinical trials require significant additional financial and management resources and reliance on third-party clinical investigators, CROs, and consultants, which may cause us to encounter delays that are outside of our control. We may be unable to identify and contract with sufficient investigators, CROs, or consultants on a timely basis, if at all.
If these third parties do not successfully carry out their contractual duties or obligations or meet expected deadlines, if they need to be replaced, or if the quality or accuracy of the clinical data they obtain is compromised due to the failure to adhere to our clinical protocols, legal and regulatory requirements or for other reasons, our preclinical or clinical trials may be extended, delayed or terminated and we may not be able to complete development of, obtain regulatory approval for, or successfully commercialize, our current or future product candidates. In addition, we will be unable to control whether or not they devote sufficient time and resources to our preclinical and clinical programs. These outside contractors may not assign as great a priority to our programs or pursue them as diligently as we would if we were undertaking such programs ourselves. As a result, our operations and the commercial prospects for the effected drug candidates would be harmed, our costs could increase and our ability to generate revenues could be delayed. These contractors may also have relationships with other commercial entities, some of whom may compete with us. If our contractors assist our competitors to our detriment, our competitive position would be harmed.
If our relationships with any third parties conducting our studies are terminated, we may be unable to enter into arrangements with alternative third parties on commercially reasonable terms, or at all. Switching or adding third parties to conduct our studies involves substantial cost and requires extensive management time and focus. In addition, there is a natural transition period when a new third party commences work. As a result, delays occur, which can materially impact our ability to meet our desired clinical development timelines. Although we carefully manage our relationships with third parties conducting our studies, we cannot assure you that we will not encounter similar challenges or delays in the future or that these delays or challenges will not have a material and adverse effect on our business, financial condition and results of operations.
We rely, and expect to continue to rely, on the third-party manufacturers to manufacture our current or future product candidates. Reliance on third parties increases the risk that we will not have sufficient quantities of our products or such quantities at an acceptable quality and cost, which could delay, prevent or impair our development or commercialization efforts.
We do not currently own any facility that may be used as our clinical-scale manufacturing and processing facility and must rely on outside vendors to manufacture our current or future product candidates. We rely on a single CMO to manufacture NXP900 drug substance and another single CMO to manufacture NXP900 drug product. There is no assurance that we will be able to retain these relationships, and if we are unable to maintain these relationships, we could experience delays in our development efforts. There is no assurance that our CMOs will be successful in manufacturing NXP100, NXP200 or NXP900 drug substance or product. If NXP100, NXP200, NXP900 or any other drug candidate we may develop or acquire in the future receives regulatory approval, we will likely rely on one or more CMOs to manufacture the commercial supply of such drugs.
Our anticipated reliance on a limited number of third-party manufacturers exposes us to a number of risks, including:
| ● | due to the limited number of potential manufacturers, and because the FDA requires inspection of any manufacturers’ cGMP compliance as part of our marketing application, we may be unable to identify manufacturers on acceptable terms, if at all; |
| ● | a new manufacturer would have to be educated in and develop substantially equivalent processes for, the production of our current or future product candidates; |
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| ● | our third-party manufacturers might be unable to timely manufacture our current or future product candidates or produce the quantity and quality required to meet our clinical and commercial needs due to a variety of potential reasons including failure to achieve drug substance or drug product specifications, batch to batch inconsistencies, site or equipment contaminations, failure to scale up as needed in a cost-efficient manner, failed regulatory inspections, competition for production capacity and availability from other customers; |
| ● | we may not own, or may have to share, the intellectual property rights to any improvements made by our third-party manufacturers in the manufacturing process for our current or future product candidates; |
| ● | our third-party manufacturers could breach or terminate their agreements with us; |
| ● | our third-party manufacturers might be unable to formulate and manufacture our drugs in the volume and of the quality required to meet our clinical and commercial needs, if any; |
| ● | our third-party manufacturers may not perform as contractually agreed or may not remain in the contract manufacturing business for the time required to supply our clinical trials or to successfully produce, store and distribute our products; |
| ● | drug manufacturers are subject to ongoing periodic unannounced inspection by the FDA and some state agencies in the United States, as well as foreign regulatory authorities, to ensure strict compliance with cGMP regulations and other regulatory requirements; and |
| ● | raw materials and components used in the manufacturing process, particularly those for which we have no other source or supplier, may not be available or may not be suitable or acceptable for use due to material or component defects. |
Each of these risks could delay or prevent the completion of our preclinical or clinical trials or the approval of any of our current or future product candidates by the FDA or another foreign regulatory authority, result in higher costs or adversely impact commercialization of our current or future product candidates.
Although our agreements with our CMOs require them to perform according to certain cGMP requirements such as those relating to quality control, quality assurance and qualified personnel, we cannot control the conduct of our CMOs to implement and maintain these standards. If any of our CMOs cannot successfully manufacture material that conforms to our specifications and the regulatory requirements of the FDA, EMA or other comparable foreign authorities, we could be prevented from obtaining regulatory approval for our drug candidates unless and until we engage a substitute CMO that can comply with such requirements, which we may not be able to do. Any such failure by any of our CMOs would significantly impact our ability to develop, obtain regulatory approval for or market our drug candidates, if approved.
We are substantially dependent on Haisco Pharmaceutical Group for the transfer of technology, know-how, and supply of certain materials necessary to execute our development and commercialization plans for NXP100 and NXP200, and any disruption in this relationship could materially harm our business.
We are substantially dependent on our in-licensing partner, Haisco, for the transfer of technical knowledge and know-how, and for the supply of certain materials, including active pharmaceutical ingredients, intermediates, and other components, necessary to execute our development, manufacturing, and commercialization plans for both NXP100 and NXP200. Our ability to advance these programs on our anticipated timelines, and ultimately to develop, manufacture, and commercialize NXP100 and NXP200 successfully, depends in substantial part on Haisco's willingness and ability to timely and completely transfer the requisite technology, documentation, and institutional know-how, and to supply us, or third parties on our behalf, with materials that meet applicable specifications and quality standards.
This dependence subjects us to a number of risks, including that:
| ● | Haisco may fail to transfer complete, accurate, or timely technical information, analytical methods, manufacturing processes, or other know-how necessary for us to independently develop, manufacture, or seek regulatory approval for NXP100 or NXP200, which could delay or prevent our development and commercialization efforts; |
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| ● | Haisco may be unable or unwilling to supply materials in the quantities, quality, or timeframes we require, whether due to capacity constraints, competing priorities, financial difficulties, regulatory actions affecting its facilities, or other operational disruptions; |
| ● | materials supplied by Haisco may not meet applicable regulatory, quality, or specification requirements, which could result in delays, rejected batches, additional testing, or the need to identify and qualify alternative sources; |
| ● | we have limited or no control over Haisco's manufacturing processes, quality systems, supply chain, or business priorities, and any deficiencies in these areas may not become apparent to us until late in the development or commercialization process; |
| ● | Haisco is subject to Chinese laws, regulations, and government actions, including those relating to export controls, foreign exchange, and outbound transfers of technology or materials, any of which could delay or restrict its ability to perform its obligations to us; |
| ● | identifying, qualifying, and transitioning to an alternative source of the relevant technology, know-how, or materials, if necessary, would likely be costly and time-consuming, and may not be feasible on commercially reasonable terms, or at all, particularly given the specialized nature of certain materials and processes; |
| ● | any dispute with Haisco regarding the interpretation or performance of our license agreement, including with respect to technology transfer obligations, supply commitments, or quality standards, could result in delays, litigation, or termination of the agreement; and |
| ● | deterioration in Haisco's financial condition, changes in its business strategy or ownership, or its prioritization of other partners or programs could reduce its ability or willingness to satisfy its obligations to us. |
If Haisco fails to perform its obligations to us in a timely manner or in accordance with applicable regulatory requirements, or if our relationship with Haisco is disrupted or terminated for any reason, we may experience significant delays in the development, manufacturing, or commercialization of NXP100 and NXP200, incur substantial additional costs, or be unable to advance these programs at all. Any of the foregoing could have a material adverse effect on our business, financial condition, and results of operations.
If our third-party manufacturers use hazardous and biological materials in a manner that causes injury or violates applicable law, we may be liable for damages.
Although we believe that our manufacturers’ procedures for using, handling, storing, and disposing of hazardous and biological materials comply with legally prescribed standards, we cannot completely eliminate the risk of contamination or injury. In the event of an accident, local, city, state or federal authorities may curtail the use of these materials and interrupt our business operations. Further, we could be held liable for damages or penalized with fines, and the liability could exceed our resources. We do not have any insurance for liabilities arising from medical or hazardous materials.
Risks Related to Managing Growth and Employee Matters
We are highly dependent on our key personnel and anticipate hiring new key personnel. If we are not successful in attracting and retaining highly qualified personnel, we may not be able to successfully implement our business strategy.
Our ability to compete in the highly competitive biotechnology and pharmaceutical industries depends upon our ability to attract and retain highly qualified managerial, scientific and medical personnel. We are highly dependent on our management, scientific and medical personnel, including our Chairman, Chief Executive Officer and President, our Chief Scientific and Business Officer and our Chief Development and Operations Officer. While we expect to engage in an orderly transition process as we integrate newly appointed officers and managers, we face a variety of risks and uncertainties relating to management transition, including diversion of management attention from business concerns, failure to retain other key personnel or loss of institutional knowledge.
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We will need to grow the size of our organization, and we may experience difficulties in managing this growth.
As of October 30, 2026, we had 19 full-time employees. We also contract for various services through consulting and vendor agreements. We intend to hire new employees to conduct our research and development activities in the future. Any delay in hiring such new employees could result in delays in our research and development activities and would harm our business. As our development and commercialization plans and strategies develop, and as we transition into operating as a public company, we expect to need additional managerial, operational, sales, marketing, financial and other personnel, as well as additional facilities to expand our operations.
If we are not able to effectively expand our organization by hiring new employees and expanding our groups of consultants and contractors, or we are not able to effectively build out new facilities to accommodate this expansion, we may not be able to successfully implement the tasks necessary to further develop and commercialize our current or future product candidates and, accordingly, may not achieve our research, development and commercialization goals.
We will incur significant increased costs as a result of operating as a public company, and our management will be required to devote substantial time to compliance activities and initiatives.
As a public company, we will incur significant legal, accounting, and other expenses that we did not incur as a private company. We are now subject to the reporting requirements of the Securities Exchange Act of 1934, as amended, which requires, among other things, that we file with the SEC, annual, quarterly, and current reports with respect to our business and financial condition. In addition, the Sarbanes-Oxley Act of 2002 (“SOX”), as well as rules subsequently adopted by the SEC and the Nasdaq Capital Market to implement provisions of SOX, impose significant requirements on public companies, including requiring establishment and maintenance of effective disclosure and financial controls and changes in corporate governance practices.
Moreover, these rules and regulations will increase our legal and financial compliance costs and make some activities more time-consuming and costly. For example, these rules and regulations make it more difficult and more expensive for us to obtain director and officer liability insurance, and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. As a result, it may be more difficult for us to attract and retain qualified persons to serve on our Board of Directors, our Board committees or as executive officers.
SOX requires, among other things, that we maintain effective internal control over financial reporting and disclosure controls and procedures. As a result, we are required to periodically perform an evaluation of our internal control over financial reporting to allow management to report on the effectiveness of those controls, as required by Section 404 of SOX. These efforts to comply with Section 404 will require the commitment of significant financial and managerial resources. While we anticipate maintaining the integrity of our internal control over financial reporting and all other aspects of Section 404, we cannot be certain that a material weakness will not be identified when we test the effectiveness of our control systems in the future. If a material weakness is identified, we could be subject to sanctions or investigations by the SEC or other regulatory authorities, which would require additional financial and management resources, costly litigation or a loss of public confidence in our internal control, which could have an adverse effect on the market price of our stock.
Our business and operations would suffer in the event of computer system failures, cyber-attacks, or deficiencies in our or third parties’ cybersecurity.
We are increasingly dependent upon information technology systems, infrastructure, and data to operate our business. In the ordinary course of business, we may collect, store, and transmit confidential information, including, but not limited to, information related to our intellectual property and proprietary business information, personal information, and other confidential information. We have outsourced elements of our operations to third party vendors, who each have access to our confidential information, which increases our disclosure risk. Although we have implemented internal security and business continuity measures, our information technology and other internal infrastructure systems may breakdown, incur damage or be interrupted by system malfunctions, natural disasters, terrorism, war, or telecommunication and electrical failures, as well as by inadvertent or intentional security breaches by our employees, contractors, consultants, business partners, and/or other third parties, or from cyber-attacks by malicious third parties, each of which could compromise our system infrastructure or lead to the loss, destruction, alteration, disclosure, or dissemination of, or damage or unauthorized access to, our data or other assets. Such a security breach may cause loss, damage, or disclosure of proprietary or confidential information, which could in turn result in significant legal and financial exposure and reputational damage that could
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adversely affect our business. Furthermore, the loss or corruption of clinical trial data from future clinical trials may result in delays in our regulatory approval efforts and could significantly increase our costs to recover or reproduce the data.
The costs related to significant security breaches or disruptions could be material and our insurance policies may not be adequate to compensate us for the potential losses arising from any such security breach. In addition, such insurance may not be available to us on economically reasonable terms, if at all, may not cover all claims made against us, and may have high deductibles. Furthermore, if the information technology systems of our third-party vendors and other contractors and consultants become subject to disruptions or security breaches, we may have insufficient recourse against such third parties and we may have to expend significant resources to mitigate the impact of such an event, and to develop and implement protections to prevent future events of this nature from occurring.
Risks Related to Commercial Activities
If any of our current or future product candidates do not achieve broad market acceptance among physicians, patients, healthcare payors and the medical community, the revenues from any such current or future product candidate may be limited.
The use of precision medicines as a potential cancer treatment is a recent development and may not become broadly accepted by physicians, patients, hospitals, cancer treatment centers, and others in the medical community. We cannot predict whether physicians, patients, hospitals, cancer treatment centers, and government agencies or third-party payors will determine that our product is safe, therapeutically effective, and cost effective as compared with competing treatments. If our current or potential future product candidates do not achieve an adequate level of market acceptance, we may not generate significant product revenues and may not become profitable. Factors influencing acceptance of our current or future product candidates in the market, include: the clinical indications for which our product candidates are licensed; whether our product candidates are viewed as a safe and effective treatment; our ability to demonstrate our product’s advantages, including cost advantages, over alternative treatments; the prevalence and severity of any side effects of our products and of other precision medicines; product labeling or product insert requirements of the FDA or other regulatory authorities and limitations or warnings contained in the labeling; the timing of market introduction of our product candidates and competitive products; patient willingness to pay out-of-pocket in the absence of coverage by third-party payors and government authorities; and the effectiveness of our sales and marketing efforts.
If our current or future product candidates are licensed but fail to achieve market acceptance among physicians, patients, hospitals, cancer treatment centers or others in the medical community, we will not be able to generate significant revenue. In addition, although our current or future product candidates may differ in certain ways from other precision medicine approaches, serious adverse events or deaths in other preclinical or clinical trials involving precision medicines, even if not ultimately attributable to our current or future products or product candidates, could result in increased government regulation, unfavorable public perception and publicity, potential regulatory delays in the testing or licensing of our current or future product candidates, stricter labeling requirements for those product candidates that are licensed, and a decrease in demand for any such product candidates.
If product liability lawsuits are brought against us, we may incur substantial liabilities and may be required to limit commercialization of our current or future product candidates.
We face an inherent risk of costly and time-consuming product liability lawsuits as a result of the planned clinical testing of our current or future product candidates and will face an even greater risk if we commercialize any products. For example, we may be sued if our current or future product candidates cause or are perceived to cause injury or are found to be otherwise unsuitable during clinical testing, manufacturing, marketing or sale. If we cannot successfully defend ourselves against product liability claims, we may incur substantial liabilities or be required to limit commercialization of our current or future product candidates. Failure to obtain or retain sufficient product liability insurance at an acceptable cost may prevent or inhibit the commercialization of products we may develop. Although we have clinical trial insurance, our insurance policies have various exclusions, and we may be subject to a claim for which we have no coverage. We may have to pay any amounts awarded by a court or negotiated in a settlement that are not covered by or which exceed our insurance coverage, and we may not have sufficient capital to pay such amounts.
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Risks Related to Ownership of our Common Stock
We do not know whether an active, liquid and orderly trading market will develop for our Common Stock or what the market price of our Common Stock will be and, as a result, it may be difficult for you to sell your shares of our Common Stock.
Prior to the pricing of our initial public offering on February 4, 2022, there was no public trading market for shares of our Common Stock and after our IPO the trading price of our Common Stock has been volatile. Although our Common Stock is listed on the Nasdaq Capital Market, an active trading market for our shares is still developing and may not be sustained in the future. The lack of an active market for our Common Stock creates volatility in the price of the stock and may impair investors’ ability to sell their shares at the time they wish to sell them or at a price that they consider reasonable and may reduce the fair market value of their shares. Further, an inactive market may impair our ability to raise capital by selling shares of our Common Stock and to enter into strategic partnerships or acquire companies or products using our shares of common stock as consideration.
Our growth is subject to economic and political conditions.
Our business is affected by global and local economic and political conditions as well as the state of the financial markets, inflation, recession, financial liquidity, currency volatility, growth, and policy initiatives. There can be no assurance that global economic conditions and financial markets will not worsen and that we will not experience any adverse effects that may be material to our consolidated cash flows, results of operations, financial position or our ability to access capital, such as the adverse effects resulting from a prolonged shutdown in government operations both in the United States and internationally. Political changes, including war or other conflicts, some of which may be disruptive, could interfere with our supply chain, our customers and all of our activities in a particular location.
We do not intend to pay dividends on our Common Stock in the foreseeable future, so any returns will be limited to the value of our stock, which may be volatile.
We plan to retain future earnings for the development, operation, and expansion of our business and do not anticipate declaring or paying any cash dividends for the foreseeable future. Any return to stockholders will be limited to the appreciation of their stock, which may never occur. Further, the trading price of our common stock is likely to be highly volatile and may be subject to wide fluctuations in response to various factors, some of which are beyond our control. Broad market and industry factors may negatively affect the market price of our common stock, regardless of our actual operating performance.
If equity research analysts do not publish research or reports about our business or if they publish negative evaluations of or downgrade our Common Stock, the price of our Common Stock could decline.
The trading market for our Common Stock relies in part on the research and reports that equity research analysts publish about us or our business. We do not control these analysts. If no or few analysts publish research reports on the Company or if analysts publish negative research reports about the Company, our stock price may significantly decline.
Raising additional capital may cause dilution to our existing stockholders, restrict our operations, or require us to relinquish rights to our current or future technologies or product candidates.
We may seek additional capital through a combination of public and private equity offerings, At-the-Market offering program, debt financings, strategic partnerships and alliances and licensing arrangements. Any equity or equity-related financing may dilute our stockholders and may subject us to restrictive covenants and interest costs. If we obtain funding through a strategic collaboration or licensing arrangement, we may be required to relinquish our rights to our current product candidates or any future product candidates that we may develop.
Additional fundraising efforts may divert our management from their day-to-day activities, which may adversely affect our operations. If we are unable to raise additional capital as needed or on acceptable terms, we may be required to delay or discontinue any research, development or commercialization programs and may be unable to expand our operations or otherwise capitalize on our business opportunities. Further, we may be required to seek collaborators for potential product candidates earlier, or on less favorable terms, than might otherwise be desired, or to relinquish or license our rights to potential product candidates in markets where we otherwise would
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seek to pursue development or commercialization. Any of the above events could significantly harm our business, prospects, financial condition and results of operations and cause the price of our common stock to decline.
Our principal stockholders and management own a significant percentage of our stock and will be able to exert significant influence over matters subject to stockholder approval.
As of July 31, 2026, our executive officers, directors, and 5% stockholders beneficially owned approximately 40.0% of our voting stock and anticipate that the same group will hold a significant portion of our outstanding voting stock for the foreseeable future. These stockholders will have the ability to influence us through their ownership position. This may prevent or discourage unsolicited acquisition proposals or offers for our common stock.
Our failure to meet the continuing listing requirements of the NASDAQ Capital Market could result in a de-listing of our securities.
If we fail to satisfy the continuing listing requirements of NASDAQ, such as the corporate governance, stockholders’ equity or minimum closing bid price requirements, NASDAQ may take steps to delist our common stock. Such a delisting would likely have a negative effect on the price of our common stock and would impair our stockholders’ ability to sell or purchase our common stock. In the event of a delisting, we would likely take actions to restore our compliance with NASDAQ’s listing requirements, but we can provide no assurance that any such action taken by us would allow our common stock to become listed again, stabilize the market price or improve the liquidity of our securities, prevent our common stock from dropping below the NASDAQ minimum bid price requirement or prevent future non-compliance with NASDAQ’s listing requirements.
We are an emerging growth company and a smaller reporting company, and we cannot be certain if the reduced reporting requirements applicable to emerging growth companies and smaller reporting companies will make our common stock less attractive to investors.
We are an emerging growth company, as defined in the JOBS Act, and a smaller reporting company, as defined in Regulations S-K. For as long as we continue to be an emerging growth company and/or a smaller reporting company, we may take advantage of exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies and smaller reporting companies, including: exemption from the auditor attestation requirements of Section 404 of SOX, as amended; being permitted to provide only two years of our audited financial statements and correspondingly reduced “Management’s Discussion and Analysis of Financial Condition and Results of Operations”; exemption from any Public Company Accounting Oversight Board requirement regarding audit firm rotation or an auditor report supplement providing additional information about the audit and financial statements; reduced disclosure obligations regarding executive compensation; and exemption from the nonbinding advisory votes on executive compensation and stockholder approval of any golden parachute payments not previously approved.
We have elected to take advantage of certain of the reduced reporting obligations. We cannot predict whether investors will find our common stock less attractive if we rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be reduced or more volatile.
Provisions in our certificate of incorporation, our bylaws, and Delaware law may discourage, delay, or prevent a change in control of our Company or changes in our management and, as a result, depress the trading price of our stock.
Provisions of our certificate of incorporation, our bylaws and Delaware law may deter unsolicited takeovers and/or delay or prevent a change in control of our Company, including transactions in which our stockholders might otherwise receive a premium for their shares.
In addition, the Delaware General Corporation Law prohibits a publicly held Delaware corporation from engaging in a business combination with an interested stockholder, defined as a person who owns, or within the last three years has owned, 15% of our voting stock, for a period of three years after the date of the transaction in which the person became an interested stockholder, unless the business combination is approved in a prescribed manner.
The foregoing provisions and anti-takeover measures may limit the price that investors might be willing to pay in the future for shares of our Common Stock and may deter potential acquirers of our Company.
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Item 2.Unregistered Sales of Equity Securities and Use of Proceeds.
During the period covered by this report, we have not issued any unregistered securities.
Use of Proceeds from Sales of Registered Securities
On August 24, 2022, our registration statement on Form S-1 (File No. 333-266857), which was filed on August 15, 2022, was declared effective by the SEC. Pursuant to such registration statement, we sold an aggregate of 1,015,598 shares of our common stock at a price of $8.25, and 909,091 of pre-funded warrants to purchase one share of common stock at $8.25 per share for aggregate net cash proceeds of approximately $14.3 million, which amount is net of $1.4 million in placement agent fees, and $0.3 million of other expenses incurred in connection with the offering. We closed the private placement on July 29, 2022. H.C. Wainright & Co acted as sole private placement agent for the offering. In this offering, we also issued to the investors who participated in the offering preferred investment options to purchase up to an aggregate of 1,924,689 shares of common stock, at an exercise price of $9.65 per share with a term of three and one-half years from the date of issuance. On July 15, 2025, the preferred investment option term was extended two additional years.
On February 6, 2025, our prospectus supplement on Form 424B5 (File No. 333-270657) was declared effective by the SEC. Pursuant to such prospectus supplement, we sold an aggregate of 3,105,000 shares of our common stock at a price of $5.00 per share for aggregate net cash proceeds of approximately $14.0 million, which amount is net of $1.1 million in underwriter’s discounts, and commissions, and $0.4 million of other expenses incurred in connection with the offering. We closed the offering on February 6, 2025. Lucid Capital Markets, LLC acted as sole underwriter for the offering.
On July 1, 2026, the Company completed a public offering with Cantor Fitzgerald & Co., as representative of the underwriters, pursuant to which the Company agreed to sell 5,000,000 shares of common stock at a public offering price of $20.00 per share,
pursuant to the Company’s effective shelf registration statement on Form S-3 (File No. 333-293459) and a related prospectus
supplement filed with the Securities and Exchange Commission on June 30, 2026. On July 29, 2026, the underwriters fully exercised their option to purchase an additional 750,000 shares of common stock at a public offering price of $20.00 per share. The offering resulted in total net proceeds to the Company of approximately $106.3 million, after deducting underwriting discounts, commissions, and estimated offering expenses payable by the Company.
We intend to use the net proceeds of these offerings to fund the development of NXP100, NXP200 and NXP900, to continue development and sponsored research related to our current product candidates or any future product candidate, hiring of additional personnel, capital expenditures, costs of operating as a public company and other general corporate purposes.
Item 3.Defaults Upon Senior Securities.
None.
Item 4.Mine Safety Disclosures.
Not applicable.
Item 5.Other Information.
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Item 6. Exhibits
Exhibit No. | | Description |
| | |
10.1† | | |
31.1* | | |
31.2* | | |
32.1** | | |
32.2** | | |
101* | | The following financial information from the Company’s quarterly report on Form 10-Q for the period ended September 30, 2026, formatted in Inline Extensible Business Reporting Language (XBRL): (i) the Condensed Balance Sheets, (ii) the Condensed Statements of Operations, (iii) the Condensed Statement of Stockholders’ Equity, (iv) the Condensed Statements of Cash Flows, and (v) Notes to the Condensed Financial Statements. |
104* | | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |
* Filed herewith.
** Furnished herewith.
† Certain portions of this document have been redacted in accordance with Regulation S-K, Item 601(b)(10). The Company agrees to
furnish supplementally an unredacted copy of the exhibit to the Securities and Exchange Commission upon its request.
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Signatures
Pursuant to the requirements of the Securities Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Fort Lee, State of New Jersey, on this 4th day of November 2026.
| Nuvectis Pharma, Inc. | ||
|
| ||
| By: | /s/ Ron Bentsur | |
|
| Name: | Ron Bentsur |
|
| Title: | Chairman, Chief Executive Officer and President |
| | | |
| By: | /s/ Michael J Carson | |
|
| Name: | Michael J Carson |
|
| Title: | Vice President of Finance (Principal Financial and Accounting Officer) |
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| EXHIBIT 10.1 CERTAIN IDENTIFIED INFORMATION HAS BEEN EXCLUDED FROM THE EXHIBIT BECAUSE IT WOULD LIKELY CAUSE COMPETITIVE HARM TO THE REGISTRANT IF PUBLICLY DISCLOSED. [***] INDICATES THAT INFORMATION HAS BEEN REDACTED. |
| CONFIDENTIAL EXCLUSIVE LICENSE AGREEMENT This Exclusive License Agreement (the “Agreement”) is entered into as of June 22nd, 2026 (the “Execution Date”), by and between Haisco Pharmaceutical Group Co., Ltd., a corporation organized under the laws of People’s Republic of China (“Haisco”) and Nuvectis Pharma, Inc., a corporation organized under the laws of the State of Delaware, USA (“Licensee”). Haisco and Licensee may sometimes individually be referred to herein as a “Party” or, collectively, as the “Parties”. RECITALS WHEREAS, Haisco Controls certain intellectual property rights relating to Licensed Compounds and Licensed Products; and WHEREAS, Licensee wishes to acquire from Haisco, and Haisco wishes to grant to Licensee, certain licenses as set forth herein to Exploit the Licensed Compounds and Licensed Products in the Field in the Territory; and WHEREAS, this Agreement is subject to a financing condition and will not become effective unless and until the Financing Closing occurs. NOW, THEREFORE, in consideration of the mutual covenants and obligations set forth herein, the Parties, intending to be legally bound, agree as follows: ARTICLE I DEFINITIONS AND INTERPRETATION 1.1 Definitions. For the purposes of this Agreement, the following words and phrases (and their correlatives) will have the following meanings: 1.1.1 “Accounting Standards” means U.S. GAAP, consistently applied. 1.1.2 “Affiliate” means, with respect to a Person, any other Person that, directly or indirectly, through one or more intermediaries, controls, is controlled by or is under common control with such first Person for so long as such first Person controls, is controlled by or is under common control with such other Person. As used herein, the term “control” means the direct or indirect ownership of 50% or more of the stock having the right to vote for directors thereof or the ability to otherwise control the management thereof. 1.1.3 “Ancillary Agreement” means any other agreement entered into between the Parties (or their respective Affiliates) pursuant to this Agreement, including the Clinical Supply Agreement, the Quality Agreement, and the Pharmacovigilance Agreement. 1.1.4 “Applicable Law” means any law or statute, any rule or regulation (including written governmental interpretations thereof, the guidance related thereto, or the application thereof) issued by a Governmental Authority and any judicial, governmental, or administrative order, judgment, decree, or ruling, in each case as applicable to the subject matter and the parties at issue. 1.1.5 “Bankruptcy Code” means Title 11, United States Code, as amended. |
| 2 1.1.6 “BRaf Compound” means (a) HSK42360, an inhibitor of the BRaf kinase, or (b) any other compound claimed in Licensed Patent Rights and/or analogues, modifications, salts, polymorphs, metabolites, isomers of any of the foregoing compounds. 1.1.7 “BRaf Licensed Product” means any pharmaceutical composition(s) containing BRaf Compound either alone, or in combination with other agents, including in all formulations and methods of delivery. 1.1.8 “BRaf Program” means any and all activities conducted by or on behalf of a Party in furtherance of the Exploitation of BRaf Compounds or BRaf Licensed Products under this Agreement. 1.1.9 “Business Day” means a day that is not a Saturday, Sunday or a day on which banking institutions in either New York, New York, USA, or Shanghai, China are authorized or required by Applicable Law to remain closed. 1.1.10 “Calendar Quarter” means any of the 3-month periods beginning on January 1, April 1, July 1 or October 1 of any Calendar Year, except that (a) the first Calendar Quarter of the Term will commence on the Effective Date and end on the first to occur of March 31, June 30, September 30 or December 31 thereafter and the last Calendar Quarter will end on the last day of the Term and (b) the first Calendar Quarter of a Royalty Term for a Licensed Product will begin on the First Commercial Sale of such Licensed Product in the Territory and end on the first to occur of March 31, June 30, September 30 or December 31 thereafter and the last Calendar Quarter of a Royalty Term for a Licensed Product will end on the last day of such Royalty Term. 1.1.11 “Calendar Year” means (a) for the first Calendar Year, the period commencing on the Effective Date and ending on December 31 of the year during which the Effective Date occurs, (b) for the last Calendar Year, the period commencing on January 1 of the last year of the Term, and ending on the last day of the Term, and (c) each interim period of 12 months commencing on January 1 and ending on December 31. 1.1.12 “CDA” means Mutual Confidentiality Agreement between Licensee and Haisco dated as of June 18, 2025. 1.1.13 “CFBi Compound” means (a) HSK39297, an inhibitor of the Factor B, or (b) any other compound claimed in Licensed Patent Rights and/or analogues, modifications, salts, polymorphs, metabolites, isomers of any of the foregoing compounds. 1.1.14 “CFBi Licensed Product” means any pharmaceutical composition(s) containing CFBi Compound either alone, or in combination with other agents, including in all formulations and methods of delivery. 1.1.15 “CFBi Program” means any and all activities conducted by or on behalf of a Party in furtherance of the Exploitation of CFBi Compounds or CFBi Licensed Products under this Agreement. 1.1.16 “cGMP” means all applicable current Good Manufacturing Practices, including, as applicable, the principles detailed in China Good Manufacturing Practices for Pharmaceutical Products (2010 Revision) (as amended), the U.S. Current Good Manufacturing Practices, 21 C.F.R. Parts 4, 210, 211, 601, 610 and 820, and the European Directive 2003/94/EC and Eudralex 4, including the principles detailed in the International Conference on Harmonization |
| 3 (“ICH”) Q7 guidelines, and the equivalent in any additional relevant country or jurisdiction, each as may be amended and applicable from time to time. 1.1.17 “Change of Control” means, with respect to a Party, any of the following: (a) the acquisition of beneficial ownership, directly or indirectly, by any Person (other than such Party or an existing Affiliate of such Party) (or group of such Persons acting in concert) of securities or other voting interests of such Party representing a majority or more of the combined voting power of such Party’s then outstanding securities or other voting interests; (b) any merger, reorganization, consolidation, or business combination involving such Party with a Third Party that results in the holders of beneficial ownership of the voting securities or other voting interests of such Party (or, if applicable, the ultimate parent of such Party) immediately prior to such merger, reorganization, consolidation, or business combination ceasing to hold beneficial ownership of more than fifty percent (50%) of the combined voting power of the surviving entity immediately after such merger, reorganization, consolidation, or business combination; or (c) any sale, lease, exchange, contribution, or other transfer (in one transaction or a series of related transactions) of all or substantially all of the assets of such Party to which this Agreement relates, other than a sale, contribution, or disposition of such assets to an Affiliate of such Party that is not part of a transaction or series of transactions that otherwise results in a Change of Control of such Affiliate. The acquiring or combining Third Party in any of (a), (b) or (c), and any of such Third Party’s Affiliates (whether in existence as of or any time following the applicable transaction, but other than the acquired Party and its Affiliates as in existence prior to the applicable transaction or Affiliates it controls after the applicable transaction) are referred to collectively herein as the “Acquirer.” For clarity, none of the following events will constitute a Change of Control unless such event would otherwise result in a transaction set forth in the above (a), (b) or (c): any (i) reorganization, spin-out, or merger with an Affiliate; (ii) acquisition, consolidation, or reorganization undertaken for tax planning purposes or as a result of a corporate restructuring of a Party’s parent company or any of its Affiliates (including change of place of incorporation or domicile); or (iii) sale, lease, exchange, contribution, or other transfer of the assets of a Party to an Affiliate undertaken for tax planning purposes or as a result of a corporate restructuring of a Party’s parent company or any of its Affiliates (including change of place of incorporation or domicile). 1.1.18 “Clinical Trial” means any clinical investigation conducted on human subjects, as that term is defined in FDA regulations at 21 C.F.R. § 312.3 (or any foreign equivalent) or as prescribed by the Regulatory Authorities in a country or jurisdiction outside the United States. Without limiting the foregoing, Clinical Trials includes any Phase 1 Clinical Trial, Phase 1b/2 Clinical Trial, Phase 2 Clinical Trial, Phase 2/3 Clinical Trial, or Phase 3 Clinical Trial. 1.1.19 “CMC” means chemistry, manufacturing and controls with respect to Licensed Compounds and Licensed Products, including the chemistry, manufacturing and controls section of Regulatory Documentation for Licensed Products. 1.1.20 “Combination Product” means any Licensed Product containing one or more Licensed Compound(s) in combination with or consisting of: (a) one or more other active pharmaceutical ingredients (other than another Licensed Compound) for which Licensee, its Affiliates, or any Sublicensee does not owe a milestone, royalty, or other payment to Haisco or any of its Affiliates under this Agreement, sold either as a fixed dose/unit or as separate doses/units in a single package or otherwise co-packaged or combined, or (b) one or more devices for which Licensee, its Affiliates, or any Sublicensee does not owe a milestone, royalty, or other payment to Haisco or any of its Affiliates under this Agreement, in each case of clauses (a) and (b), sold for a single price (such other active ingredients or devices described in clauses (a) and (b), “Other |
| 4 Components”). For the avoidance of doubt, a Combination Product may include a Licensee FDC Product. 1.1.21 “Commercialize” means all activities directed to pre-launch, launch, promotion, detailing, medical education and medical liaison activities, marketing, pricing, reimbursement, sale, import, export, distribution, use, prescription or administration of a compound or product, including marketing, sales force detailing, advertising, all customer support, distribution and invoicing and sales activities, including interacting with Regulatory Authorities regarding any of the foregoing but excluding activities directed to Manufacture or Development. “Commercializing,” “Commercialized” and “Commercialization” will have correlative meanings. 1.1.22 “Commercially Reasonable Efforts” means (a) where applied to carrying out a specific task or obligation of a Party under this Agreement, the carrying out of such task or obligation in a diligent, expeditious and sustained manner using efforts and resources, including reasonably necessary personnel and financial resources, that a company in the biopharmaceutical industry of a similar size and profile as such Party typically devotes to a similar task or obligation; and (b) where applied to the Development, Manufacture or Commercialization of the Licensed Compounds and the Licensed Products by a Party under this Agreement, that level of efforts and resources that are commonly used by a company in the biopharmaceutical industry of a similar size and profile as such Party to Develop, Manufacture or Commercialize, as the case may be, a product owned by such company or to which it has exclusive rights, which product is at a similar stage of development and life cycle and is of a similar commercial potential, taking into account all relevant factors that such company normally would take into consideration in making portfolio decisions, including issues of safety and efficacy, product profile, difficulty in developing or manufacturing the Licensed Product, competitiveness of alternative products (including Generic Products), the Patents or other proprietary position of the Licensed Product (including patent coverage and Regulatory Exclusivity), the regulatory requirements involved (including the likelihood of receipt of approval by the relevant Regulatory Authorities), availability of business development or partnering opportunities, price and market access considerations and the potential profitability of the Licensed Product (taking into account the amounts payable to licensors of patent or other intellectual property rights). Commercially Reasonable Efforts will be determined on a market-by-market basis, and it is anticipated that the level of efforts required may be different for different markets. 1.1.23 “Control” or “Controlled” means with respect to a Party or an Affiliate thereof (a) with respect to any item of Know-How, Patent, other intellectual property right, Regulatory Approval, or Regulatory Documentation (referred to as the “IP and Regulatory Material”) that such Party or Affiliate has the ability (whether by sole, joint or other ownership interest, license, sublicense or otherwise, and including any such abilities which are contingent, but in any case other than by operation of the licenses granted in this Agreement) to grant a license, sublicense, access or right to use (as applicable) under, or disclose or provide, such item of Know-How, Patent, other intellectual property right, Regulatory Approval, or Regulatory Documentation to the other Party, or (b) with respect to a compound, product or component thereof (referred to as the “Compound and Product”) that such Party or Affiliate has the ability (whether by sole, joint or other ownership interest, license, sublicense or otherwise, and including any such abilities which are contingent, but in any case other than by operation of the licenses granted in this Agreement) to grant a license, sublicense, or other right to or under Patent(s) that Cover or Know-How that is incorporated in or embodies such compound, product or component to the other Party, in each case, on the terms and conditions set forth herein at the time of such grant without violating or breaching the terms of any agreement or other arrangement with a Third Party or creating a payment obligation |
| 5 upon such Party. Notwithstanding the foregoing, (i) a Party and its Affiliates will not be deemed to “Control” any IP and Regulatory Material or Compound and Product that is owned or in-licensed by a Third Party that becomes an Affiliate of such Party after the Execution Date as a result of a Change of Control transaction involving such Party or its Affiliates and such Third Party or its Affiliates (whether before the consummation of such Change of Control event or thereafter if generated or acquired independent of the activities under this Agreement); except to the extent such IP and Regulatory Material or Compound and Product are used in the performance of such Party’s obligations under this Agreement or are otherwise created in reliance upon the Confidential Information of the other Party; and (ii) any IP and Regulatory Material or Compound and Product in-licensed or acquired by a Party or any of its Affiliates after the Execution Date will only be deemed “Controlled” by such Party, if such other Party agrees to abide by the terms and conditions of such in-license or acquisition and pay any amount due therefor resulting from the practice of the applicable sublicense by such other Party. 1.1.24 “Controller” means the Party that determines the means and purposes of Processing Personal Data. 1.1.25 “Cover”, “Covering” or “Covered” means, with respect to a compound, product, or other composition of matter, or technology, process, method or other Know-How, that, in the absence of ownership of, or a license to, a Patent, the practice or Exploitation of such compound, product, or other composition of matter, or technology, process, method or other Know-How, would infringe such Patent or, in the case of a Patent that has not yet issued, would infringe such Patent if it were to issue. 1.1.26 “Data Protection Laws” means any Applicable Law that governs the Processing of Personal Data. 1.1.27 “Designated Senior Officer” means: (a) with respect to Haisco, its Chief Executive Officer or his/her designee, and (b) with respect to Licensee, its Chief Executive Officer or his/her designee. 1.1.28 “Develop” means all activities that relate to the development of a compound or product, including research, preclinical and clinical drug development activities, including, toxicology, formulation, statistical analysis and report writing, conducting Clinical Trials for the purpose of obtaining and maintaining Regulatory Approval (including post-Regulatory Approval studies), and regulatory affairs related to all of the foregoing. “Developing” and “Development” will have correlative meanings. 1.1.29 “Dollar” means U.S. dollar, and “$” will be interpreted accordingly. 1.1.30 “Effective Date” means, with respect to each Program, the date of the first Financing Closing. 1.1.31 “EMA” means the European Medicines Agency, or any successor agency thereto. 1.1.32 “European CTA” means a Clinical Trial Application submitted to and accepted by a competent authority in a member state of the European Union or the European Economic Area in accordance with Regulation (EU) No 536/2014 (the Clinical Trials Regulation) or any successor regulation, authorizing the conduct of a clinical trial in such jurisdiction. |
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| 8 a Clinical Trial (including all supplements and amendments that may be filed with respect to the foregoing); and (b) any foreign counterpart of the foregoing. 1.1.50 “Initial Technology Transfer” means Initial Knowledge Transfer and IND Enabling Materials Transfer. 1.1.51 “Initiation” means, with respect to a Clinical Trial, the dosing of the first patient in such Clinical Trial. 1.1.52 “Inventions” means any invention, data, Know-How, process, method, composition of matter, article of manufacture, discovery or finding, whether or not patentable, that is conceived, reduced to practice, discovered, developed or otherwise made by or on behalf of a Party or jointly by or on behalf of the Parties in the course of the Development, Manufacture, Commercialization or other Exploitation of Licensed Compounds or Licensed Products in the Field, whether directly or via its Affiliates, agents or independent contractors, including all rights, title and interest in and to the intellectual property therein. 1.1.53 “Joint Controller(s)” means two or more Controllers that jointly determine the purposes and means of Processing Personal Data. 1.1.54 “Know-How” means information and physical or digital embodiments of such information, including discoveries, formulations, information, regulatory filings, processes, formulae, data, inventions (whether patentable or not), invention disclosures, know-how and trade secrets (whether patentable or not), including all chemical, pharmaceutical, toxicological, biochemical, biophysical, and biological, technical and non-technical data, and information relating to the results of tests, assays, methods, and processes, and specifications or other documents containing information and related data, and any preclinical, clinical, assay control, manufacturing (including CMC data), regulatory, and any other data or information. 1.1.55 “Knowledge Transfer” means the Initial Knowledge Transfer, Continuing Knowledge Transfer, and Manufacturing Technology Transfer. 1.1.56 “Licensed Compound” means, individually or collectively, a BRaf Compound or a CFBi Compound, as applicable. 1.1.57 “Licensed Know-How” means, with respect to a Program, any and all Know-How and Regulatory Documentation, including any Haisco Sole Invention, that is (a) necessary or reasonably useful (i) for the Exploitation of any Licensed Compounds or Licensed Products of such Program in the Field in the Territory or (ii) for the Development or Manufacture of any Licensed Compounds or Licensed Products of such Program in the Field in the Haisco Territory solely for the Exploitation thereof in the Territory, and (b) Controlled by Haisco or any of its Affiliates as of the Execution Date or during the Term, but in all events including Haisco’s interest in any Know-How within the Joint Collaboration IP. 1.1.58 “Licensed Materials” means, with respect to a Program, the tangible materials owned or controlled by Haisco and relating to the Licensed Compound or Licensed Product of such Program, including drug substance, drug product, formulations for all modes of delivery, relevant excipients, assays and reagents. 1.1.59 “Licensed Patents” means, with respect to a Program, any and all Patents, including any Haisco Sole Invention Patents, (a) that are necessary or reasonably useful (i) for the |
| 9 Exploitation of any Licensed Compound or Licensed Product of such Program in the Field in the Territory or (ii) for the Development or Manufacture of any Licensed Compounds or Licensed Products of such Program in the Field in the Haisco Territory solely for the Exploitation thereof in the Territory, and (b) Controlled by Haisco or any of its Affiliates as of the Execution Date or at any time during the Term, including those Patents set forth on Schedule 10.2.5, as the same will be updated from time to time in accordance with Section 10.2.5, but in all events including Haisco’s interest in any Joint Collaboration Patents. 1.1.60 “Licensed Product” means, individually and collectively, the BRaf Licensed Products and the CFBi Licensed Products, as applicable. For the avoidance of doubt, Licensed Products shall include any Licensee FDC Product, but shall not include any Haisco FDC Product. 1.1.61 “Licensed Technology” means Licensed Know-How and Licensed Patents, together. 1.1.62 “Licensee Collaboration IP” means (a) any Know-How, Patents and Regulatory Documentation Controlled by Licensee or its Affiliates, including any Licensee Sole Invention and Licensee Patent, as a result of the Exploitation of any Licensed Compounds or Licensed Products under this Agreement that is necessary or reasonably useful for Haisco to (i) perform its or its Affiliates’ obligations under this Agreement or any Ancillary Agreement, (ii) Exploit any Licensed Compounds or Licensed Products in the Field in the Haisco Territory or (iii) Manufacture or have Manufactured any Licensed Compounds or Licensed Products in the Field in the Territory solely for the Exploitation thereof in the Haisco Territory, and all rights, title and interest in and to all Patent and other intellectual property rights arising from such Know-How; and (b) Licensee’s interest in any Joint Collaboration IP, but in all events including Global Clinical Trial Safety Data. 1.1.63 “Licensee FDC Product” means a fixed dose combination product developed by Licensee, its Affiliates, Subcontractors, or Sublicensees that consists of the Licensed Compound in a fixed dose combination with one or more other active pharmaceutical ingredients that are proprietary to Licensee or its Affiliates, Subcontractors, or Sublicensees. 1.1.64 “Major Market” means any of United States, Japan, France, Germany, Spain, Italy or the United Kingdom. 1.1.65 “Manufacture” means all activities related to the manufacturing of a compound or product, or any ingredient or synthetic methods or intermediates thereof, including test method development and stability testing, formulation, process development, manufacturing for use in non-clinical or clinical studies, manufacturing scale-up, quality assurance/quality control development, quality control testing (including in-process release and stability testing), packaging, release of product or any component or ingredient thereof, quality assurance activities related to manufacturing and release of product, and regulatory activities related to all of the foregoing. “Manufacturing” and “Manufactured” will have correlative meaning. 1.1.66 “Material Development Issue” means, with respect to the Development activities of a Party, its Affiliates, or its or their licensees or Sublicensees (or, in the case of Haisco, the applicable (sub)licensees) relating to any Licensed Product, (a) based upon (i) pre-clinical or non-clinical safety data, including data from animal toxicology studies, or (ii) the observation of serious adverse events in humans after any Licensed Product, either as a single agent or in combination with another pharmaceutical agent, has been administered to or taken by humans, that |
| 10 (A) there is an unacceptable risk for harm in humans (including potential for harm in humans if administered clinically based on pre-clinical or non-clinical studies), or (B) a course of action would be reasonably likely to result in a patient safety issue that results in (1) a clinical hold issued by the applicable Regulatory Authority, or (2) a data safety monitoring board terminating a Clinical Trial of a Licensed Product; or (b) that a course of action would be reasonably likely to generate pre-clinical or clinical data that would reasonably be expected to adversely impact the Development, Manufacture, Regulatory Approval, or Commercialization of Licensed Products in the Field in the other Party’s territory (i.e., the Territory in the case of Licensee, or the Haisco Territory in the case of Haisco). 1.1.67 “Maximum Fair Price” means with respect to a given year for a Selected Drug, the price negotiated pursuant to Section 1194 (and updated pursuant to Section 1195(b), as applicable) under the Inflation Reduction Act for such drug and year. 1.1.68 “MEK Inhibitor” means a chemical or drug that is intended to treat a condition or disease in humans through inhibition of the mitogen-activated protein kinase enzymes MEK1 and/or MEK2. 1.1.69 “MFN Pricing Issue” means any situation, circumstance, or event in which (a) the price, net price, reimbursement price, or any other form of pricing (including, without limitation, any government-mandated price, negotiated price, or reference price) (taking into account all discounts, rebates, fees, chargebacks, and other price concessions) (collectively, “Pricing”) for a Licensed Product in any market outside the United States is lower than, or becomes lower than, the Pricing for such Licensed Product in the United States; and (b) such price differential between such market outside the United States and in the United States results in, causes, or triggers an obligation or requirement under Applicable Law, regulation, executive order, or government policy in the United States (including without limitation (i) the Executive Order titled “Delivering Most-Favored-Nation Prescription Drug Pricing to American Patients” issued on May 12, 2025, (ii) any successor, amendment, or related executive order, or (iii) any implementing regulations, rules, guidance, or policies related to most favored nation pricing of pharmaceuticals) (collectively, “MFN Requirements”) to reduce the Pricing of such Licensed Product in the United States to match or approximate the lower Pricing in such market outside the United States. 1.1.70 “NDA” means (a) a New Drug Application, as defined in the FFDCA, that is submitted to the FDA for Regulatory Approval for a Licensed Product, and (b) any foreign counterpart of the foregoing filed with a Regulatory Authority in conformance with the requirements of such Regulatory Authority in the Territory. 1.1.71 “Net Sales” means, with respect to a Licensed Product for any period, the gross amount invoiced by Licensee, its Affiliates or its or their Sublicensees (each, a “Selling Party”) for the sale of a Licensed Product to Third Parties (including Distributors) commencing with the First Commercial Sale of such Licensed Product less the following deductions determined in accordance with, and to the extent consistent with, Accounting Standards from such gross amounts which are actually incurred, allowed, accrued or specifically allocated: (a) discounts given in the ordinary course of business, including cash, trade and quantity discounts inclusive of free goods, price reduction programs (including co-pay assistance, compulsory refunds or any other patient assistance programs), retroactive price adjustments with respect to sales of a Licensed Product, charge-back payments and rebates granted to managed health care organizations or to federal, state and local governments (or their respective agencies, purchasers and reimbursers) or to trade customers, including wholesalers and chain and pharmacy buying groups; |
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| 12 normal business practices of the Selling Party for a bona fide charitable purpose. A Selling Party’s transfer of any Licensed Product to an Affiliate or Sublicensee will not result in any Net Sales unless the transferee is an end user. In the event that a Licensed Product is sold in any country in the form of a Combination Product, Net Sales of such Combination Product will be adjusted by multiplying actual Net Sales of such Combination Product in such country calculated pursuant to the foregoing definition of “Net Sales” by the fraction A/(A+B), where A is the average net invoice price in such country of any Licensed Product that contains the same Licensed Compound(s) as such Combination Product as its sole active ingredient(s), if sold separately in such country, and B is the average net invoice prices in such country of, as applicable, each product that contains the Other Component(s) contained in such Combination Product as its sole active ingredient(s) if sold separately in such country; provided that the invoice price in a country for (A) each Licensed Product that contains only the Licensed Compound(s) and (B) in the case of a product that contains solely the Other Component(s) included in the Combination Product will to the extent feasible be for a quantity comparable to that used in such Combination Product and of substantially the same class, purity and potency or functionality, as applicable. If either such Licensed Product that contains the Licensed Compound(s) as its sole active ingredient or any such product that the relevant Other Component(s) is not sold separately in a particular country, then the adjustment to Net Sales will be determined by the Parties in good faith to reasonably reflect the fair market value of the contribution of such Licensed Product or product in such Combination Product to the total fair market value of such Combination Product. In the case of pharmacy incentive programs, hospital performance incentive programs, chargebacks, disease management programs, similar programs or discounts on portfolio product offerings, all rebates, discounts and other forms of reimbursements will be allocated among products on the basis on which such rebates, discounts and other forms of reimbursements were actually granted or, if such basis cannot be determined, in accordance with a Selling Party’s existing allocation method; provided that any such allocation will be done in accordance with Applicable Law, including any price reporting laws, rules and regulations. Subject to the above, Net Sales will be calculated in accordance with the standard internal policies and procedures of a Selling Party, which must be in accordance with applicable Accounting Standards. 1.1.72 “Oncology Indication” means the use of a Licensed Product to prevent or treat cancer in humans. 1.1.73 “Patent” means national, regional and international (a) issued patents and pending patent applications (including provisional patent applications), (b) patent applications filed either from the foregoing or from an application claiming priority to the foregoing, including all PCTs and national phase applications, provisional applications, converted provisionals, substitutions, continuations, continuations-in-part, divisionals, renewals and continued prosecution applications, and all patents granted thereon, (c) patents-of-addition, revalidations, reissues, reexaminations and extensions or restorations by existing or future extension or restoration mechanisms, including patent term adjustments, patent term extensions, supplementary protection certificates or the equivalent thereof, (d) inventor’s certificates, utility models, petty patents, innovation patents and design patents, (e) other forms of government-issued rights substantially similar to any of the foregoing, including so-called pipeline protection or any importation, revalidation, confirmation or introduction patent or registration patent or patent of additions to any of such foregoing, and (f) United States and foreign counterparts of any of the foregoing. |
| 13 1.1.74 “Person” means any natural person, corporation, firm, business trust, joint venture, association, organization, company, partnership or other business entity, or any government or any agency or political subdivision thereof. 1.1.75 “Personal Data” means any information that (a) relates to an identified or identifiable person (including, without limitation, all key-coded or pseudonymized data); or (b) otherwise constitutes “personal data,” “personal information,” or similar term Applicable Laws. 1.1.76 “Phase 1 Clinical Trial” means a Clinical Trial of a Licensed Product conducted by or on behalf of Licensee, its Affiliates or their Sublicensees that may include the first introduction into humans, healthy volunteers, or patients of such Licensed Product, with the primary purpose of determining metabolism and pharmacokinetic properties and side effects of such product, in a manner that is generally consistent with 21 C.F.R. § 312.21(a), as amended (or its successor regulation), or the foreign equivalent thereof, excluding any investigator-initiated Clinical Trials. For clarity, for purposes of this Agreement, a Clinical Trial that satisfies the requirements of 21 C.F.R. § 312.21(a) and is also designed to gain preliminary evidence of effectiveness (e.g., a phase 1b Clinical Trial) will be deemed to be a Phase 1 Clinical Trial. 1.1.77 “Phase 1b/2 Clinical Trial” means a Clinical Trial of a Licensed Product conducted by or on behalf of Licensee, its Affiliates or their Sublicensees that (a) combines elements of both a Phase 1 Clinical Trial and a Phase 2 Clinical Trial in a single protocol, (b) is designed to evaluate both safety, tolerability, and pharmacokinetics in an initial dose-escalation phase and preliminary efficacy and optimal dosing in a subsequent expansion phase, and (c) is conducted in a manner generally consistent with the principles set forth in 21 C.F.R. § 312.21(a) and (b), as amended (or their successor regulations), or the foreign equivalent thereof, excluding any investigator-initiated Clinical Trials. 1.1.78 “Phase 2 Clinical Trial” means a Clinical Trial of a Licensed Product conducted by or on behalf of Licensee, its Affiliates or their Sublicensees (a) that would satisfy the requirements of 21 C.F.R. § 312.21(b), as amended (or its successor regulation), or the foreign equivalent thereof, or (b) on a sufficient number of subjects to evaluate the effectiveness of a pharmaceutical product for a particular indication and to obtain information about side effects and other risks associated with the drug, in a manner that is generally consistent with 21 C.F.R. § 312.21(b), as amended (or its successor regulation), or the foreign equivalent thereof, excluding any investigator-initiated Clinical Trials. For clarity, for purposes of this Agreement, a Clinical Trial that satisfies the requirements of 21 C.F.R. § 312.21(a) and is also designed to gain preliminary evidence of effectiveness (e.g., a phase 1b Clinical Trial) will not be deemed to be a Phase 2 Clinical Trial unless it also satisfies the conditions set forth in the immediately preceding sentence. For purposes of this Agreement, a Clinical Trial that satisfies the requirements of 21 C.F.R. § 312.21(b), as amended (or its successor regulation), or the foreign equivalent thereof, and is adaptive (including, for example, a Phase 2/3 Clinical Trial) or that is also designed to gain support for marketing authorization (e.g., a phase 2b Clinical Trial) will be deemed to be a Phase 2 Clinical Trial unless it also satisfies the conditions set forth in the first sentence of Section 1.1.80, in which case it will be deemed a Phase 3 Clinical Trial. 1.1.79 “Phase 2/3 Clinical Trial” means, in reference to a Clinical Trial of a Licensed Product, a Phase 2 Clinical Trial involving a sufficient number of subjects that, prior to commencement of the trial or at any other defined point in the trial, satisfies both of the following ((a) and (b)): (a) such trial is designed to (i) establish that the applicable Licensed Product is safe and efficacious for its intended use, and (ii) define and determine warnings, precautions, and adverse reactions that are associated with the Licensed Product in the dosage range to be prescribed, which |
| 14 trial is intended to support Regulatory Approval of the Licensed Product or a similar clinical study prescribed by the FDA, with respect to the United States, or other relevant Regulatory Authority with respect to any such country other than the United States, excluding any investigator-initiated Clinical Trials; and (b) such trial is or becomes a registration trial sufficient for filing an application for marketing authorization for the Licensed Product, as evidenced by (x) an agreement with or statement from the FDA, with respect to the United States, or other Regulatory Authority with respect to any country other than the United States on a special protocol assessment or equivalent, or (y) other guidance or minutes issued by the FDA or such other Regulatory Authority for such registration trial. 1.1.80 “Phase 3 Clinical Trial” means a Clinical Trial of a Licensed Product conducted by or on behalf of Licensee, its Affiliates or their Sublicensees (a) that would satisfy the requirements of 21 C.F.R. § 312.21(c), as amended (or its successor regulation), or the foreign equivalent thereof, or (b) on a sufficient number of subjects for ascertaining (or that is designed to ascertain) the overall risk-benefit relationship of the Licensed Product for its intended use and determining (or to determine) warnings, precautions, and adverse reactions that are associated with such Licensed Product in the dosage range to be prescribed, in a manner that is generally consistent with 21 C.F.R. § 312.21(c), as amended (or its successor regulation), or the foreign equivalent thereof, and that is (together with prior data and information concerning the Licensed Product) intended to be sufficient to establish that such Licensed Product is safe and effective for its intended indication to support the filing of an application for marketing authorization from a Regulatory Authority, but in any case excluding any investigator-initiated Clinical Trials. For purposes of this Agreement, a Clinical Trial that satisfies the requirements of 21 C.F.R. § 312.21(b), as amended (or its successor regulation), or the foreign equivalent thereof, and is adaptive (including, for example, a Phase 2/3 Clinical Trial) or that is also designed to gain support for marketing authorization (e.g., a phase 2b Clinical Trial) will not be deemed to be a Phase 3 Clinical Trial unless it also satisfies the conditions set forth in the first sentence of this Section 1.1.80. Without limiting the foregoing, if (i) a protocol for a Phase 2 Clinical Trial includes the enrollment of a cohort of patients that would satisfy the foregoing definition of Phase 3 Clinical Trial (“Phase 3 Cohort”), or (ii) a protocol for a Phase 2 Clinical Trial is amended to include the enrollment of a Phase 3 Cohort, then, in each case ((i) and (ii)), such Phase 2 Clinical Trial will be deemed a Phase 3 Clinical Trial on and after the date of the first dosing of the first human subject in such Phase 3 Cohort. 1.1.81 “Price Applicability Period” means, with respect to a qualifying single source drug, the period beginning when such drug is designated a Selected Drug and the Maximum Fair Price applies to sales of such drug and ending with the last year during which such drug is a Selected Drug. 1.1.82 “Process” (and any inflection thereof) means any operation or set of operations performed on data (including, without limitation, Personal Data), whether or not by automatic means, such as collection, recording, organization, storage, adaptation or alteration, retrieval, consultation, use, disclosure by transmission, dissemination or otherwise making available, alignment or combination, blocking, erasure or destruction. 1.1.83 “Program” means each of BRf Program and CFBi Program. 1.1.84 “Prosecution and Maintenance” or “Prosecute and Maintain” or “Prosecuting and Maintaining” means, with regard to a Patent, the preparing, filing, prosecuting, extending, abandoning, and maintenance of such Patent, as well as handling re-examinations and reissues with respect to such Patent, together with the conduct of interferences, derivation proceedings, pre- and post-grant opposition proceedings, post-grant patent proceedings (such as |
| 15 inter partes review and post grant review) and other similar proceedings with respect to the particular Patent. For clarification, “Prosecution and Maintenance” or “Prosecute and Maintain” or “Prosecuting and Maintaining” will not include any enforcement actions taken with respect to a Patent. 1.1.85 “Regulatory Approval” means, with respect to a country or jurisdiction, any and all approvals (including NDAs), licenses, registrations or authorizations of any Regulatory Authority necessary to commercially distribute, sell or market a biopharmaceutical product, including a Licensed Product, in such country or jurisdiction, including, where required by Applicable Law for Commercialization, (a) pricing or reimbursement approval in such country or jurisdiction, (b) pre- and post-approval marketing authorizations (including any prerequisite Manufacturing approval or authorization related thereto), and (c) labeling approval. 1.1.86 “Regulatory Authority” means, with respect to a country or jurisdiction, any national (e.g., the FDA), supra-national (e.g., the European Commission, the Council of the European Union, or the EMA) regional, state or local regulatory agency, department, bureau, commission, council or other Governmental Authority involved in the granting of a Regulatory Approval or otherwise exercising authority with respect to biopharmaceutical products in such country or jurisdiction. 1.1.87 “Regulatory Documentation” means all (a) applications (including all NDAs or INDs), registrations, licenses, authorizations and approvals (including Regulatory Approvals), (b) correspondence and reports submitted to or received from Regulatory Authorities (including minutes and official contact reports relating to any communications with any Regulatory Authority) and all supporting documents with respect thereto, including all adverse event files and complaint files, (c) Development Data and other data contained, referenced or otherwise relied upon in any of the foregoing, and (d) for clarity, any Drug Master File. For clarification, “Drug Master File” means submissions to FDA used to provide confidential, detailed information about facilities, processes, or articles used in the manufacturing, processing, packaging, and storing of human drug products, or the foreign equivalent thereof. 1.1.88 “Regulatory Exclusivity” means with respect to each Licensed Product in any country or jurisdiction in the Territory, a period of exclusivity (other than patent exclusivity) granted by a Regulatory Authority in such country or jurisdiction that confers exclusive marketing rights or data exclusivity rights with respect to such Licensed Product in such country or jurisdiction and thereby prevents another party from marketing or obtaining marketing approval for a product containing the same or similar compound as such Licensed Product or using or otherwise relying on any data supporting marketing approval of such Licensed Product without the prior written consent of the holder of such marketing approval, including rights conferred in the U.S. to a NDA holder under section 351(k)(7) of the Public Health Services Act or the FDA Modernization Act of 1997 (including pediatric exclusivity) or “orphan drug exclusivity”, and rights similar thereto outside the U.S., as well as other similar rights that may become available following the Execution Date. 1.1.89 “Royalty Term” means, on a Licensed Product-by-Licensed Product and country-by-country basis, the period commencing upon the First Commercial Sale of a Licensed Product in such country and ending upon the latest to occur of (a) the expiration of the last Valid Claim of any Patent within the Licensed Technology Covering such Licensed Product in such country, (b) the expiration of the last Regulatory Exclusivity of such Licensed Product in such country; and (c) the tenth (10th) anniversary of the First Commercial Sale of the first such Licensed Product in such country. |
| 16 1.1.90 “Selected Drug” means a drug that was selected for Medicare price negotiation and published by the Secretary of the U.S. Department of Health and Human Services, in each case, under the Inflation Reduction Act. 1.1.91 “Small Molecule” means any active pharmaceutical ingredient that is not a biological product as defined under 42 U.S.C. § 262(i), as amended. 1.1.92 “SOFR” means the secured overnight financing rate published by the Federal Reserve Bank of New York, as the administrator of the benchmark (or a successor administrator), on the website of the Federal Reserve Bank of New York at http://www.newyorkfed.org, or any successor source. 1.1.93 “Subcontractor” means a Third Party engaged by a Party, its Affiliates or Sublicensees (or, in the case of Haisco, the applicable (sub)licensees) to exercise its rights or perform its obligations under this Agreement primarily on a fee-for-service basis, including (a) contract research organizations, (b) contract manufacturers, and (c) Distributors, distribution service providers and wholesalers, in each case (a)-(c) whether or not granted a Sublicense to perform such activities (provided that, in the event a Sublicense is granted to such Third Party, the duration and scope of such Sublicense do not exceed what is reasonably necessary to perform the applicable contracted services). 1.1.94 “Sublicense Revenue” means consideration in any form received by a Licensee or its Affiliates in connection with or otherwise attributable to a grant of a sublicense or any other right, license, privilege or immunity (regardless of whether such grantee is a “Sublicensee” as defined in this Agreement) to develop, make, have made, use, have used, sell or have sold Licensed Products. Sublicense Revenue shall include without limitation any upfront payment and milestone payment. In the event the Licensee or its Affiliates receives Sublicense Revenue in the form of non-monetary consideration, such Sublicense Revenue shall be calculated based on the fair market value of such consideration at the time of the transaction (where fair market value shall be determined by agreement of the Parties or by an independent appraiser mutually agreeable to the Parties), assuming an arm’s length transaction made in the ordinary course of business. Sublicense Revenue specifically excludes the following: (a) royalties on Net Sales by Sublicensees; (b) payments to Licensee by a Sublicensee for the express purpose of funding, at reasonable cost, the expenses of bona fide prospective research and development of Licensed Products under a research and development plan mutually agreed upon between Licensee and such Sublicensee; (c) payments received by Licensee or its Affiliate(s) for the issuance of equity or debt securities in Licensee or its Affiliate(s) at fair market value at the time of the transaction (where fair market value shall be determined by agreement of the Parties or by an independent appraiser mutually agreeable to the Parties); provided that any amounts received in excess of such fair market value shall be considered Sublicense Revenue; and (d) proceeds of bona fide loans made on arms’ length terms to Licensee or its Affiliates, to the extent not forgiven. |
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| 18 pending for no longer than nine (9) years and has not been abandoned or finally disallowed without the possibility of appeal or re-filing of the application. 1.2 Additional Definitions. The following table identifies the location of additional definitions set forth in various Sections of this Agreement: Definition Section Additional Cure Period Section 12.2.3 Agreement Preamble Alliance Manager Section 3.1 Annual Net Sales for all Licensed Products Section 7.3 Arbitrators Section 13.5.1(a) Audited Party Section 7.12.1 Auditing Party Section 7.12.1 Claims Section 11.1.1 Clinical Supply Section 6.1.1 Clinical Supply Agreement Section 6.1.1 Collaboration Personnel Section 2.7.3(b) Commercial Milestone Event Section 7.3 Commercial Milestone Payment Section 7.3 Company of Concern Section 13.16.2 Competing Activities Section 2.7.3(a) Competing Activities Personnel Section 2.7.3(b) Competing Product Section 2.7.1 Competitive Infringement Section 9.3.1 Confidential Information Section 8.1.2 Continuing Knowledge Transfer Section 4.3 Crossed-Territory Global Development Plan Section 5.2.2 Cure Period Section 12.2.3 Cure Plan Section 12.2.3 Data Breach Section 10.5.3 Determination of Concern Section 13.16.2 Development Data Section 5.4 Development Milestone Event Section 7.2 Development Milestone Payment Section 7.2 Dispute Section 13.3 Distributor Section 6.4 Execution Date Preamble Enforcement Action Section 9.3.2 Extensions Section 9.2.5 Firewall Section 2.7.3(b) Firewalls Section 2.7.3(b) |
| 19 Definition Section Firewall Information Section 2.7.2 Force Majeure Event Section 13.8 Free Support Section 4.4 Global Clinical Trial Data Section 5.2.2 Global Clinical Trial Safety Data Section 5.2.3 Haisco Preamble Haisco Indemnitees Section 11.1.2 Haisco Sole Invention Patents Section 9.1.2 Haisco Sole Inventions Section 9.1.2 ICC Section 13.5.1 ICC Rules Section 13.5.1 IND Enabling Materials Section 4.1.2 IND Enabling Materials Transfer Section 4.1.2 Indemnitee Section 11.2.1 Indemnitor Section 11.2.1 Indirect Tax Section 7.10.2 Infringement Section 9.3.1 Initial Knowledge Transfer Section 4.1.1 Insolvency Event Section 12.2.4 Interim Period Section 10.3 IP and Regulatory Material Section 1.1.23 Joint Collaboration IP Section 9.1.3 Joint Collaboration Know-How Section 9.1.3 Joint Collaboration Patents Section 9.1.3 Joint Steering Committee or JSC Section 3.2 Liabilities Section 11.1.1 Licensed Rights Value Section 13.9.1 Licensee Preamble Licensee COC Competing Product Section 2.7.2 Licensee Indemnitees Section 11.1.1 Licensee Patents Section 9.1.2 Licensee Sole Inventions Section 9.1.2 Licensee Territory Development Plan Section 5.3.3 Manufacturing Technology Transfer Section 4.2.1 Manufacturing Technology Transfer Plan Section 4.2.1 MFN Impact Event Section 7.13 MTT Period Section 4.2.2 National and Data Security Law Section 13.16.2 Non-Publication Party Section 8.3 Notice of Dispute Section 13.3.1 |
| 20 Definition Section Other Component Section 1.1.20 Other Licensed Patents Section 9.2.1 Party/Parties Preamble Patent Challenge Section 12.2.5 Pivotal Trial Section 6.1 Pharmacovigilance Agreement Section 5.7 Product-Specific Licensed Know-How Section 8.1.2 Product-Specific Licensed Patents Section 9.2.1 Product Trademarks Section 9.8 Publication Section 8.3 Publication Party Section 8.3 Quality Agreement Section 6.1.1 Royalty Report Section 7.11.1 Relevant Third Parties Section 10.2.2 Sole Inventions Section 9.1.2 Stock Deficit Section 7.2 Subcontracted Activities Section 13.16.2 Sublicense Section 2.3 Sublicense Revenue Rate Section 7.4 Successful Completion of the Initial Technology Transfer Section 4.1 Successful Completion of the Manufacturing Technology Transfer Section 4.2.2 Technology Transfer Plan Section 4.1 Term Section 12.1 Territory Reversion Products Section 12.3.3(f) Third Party Action Section 9.4.1 Third Party License Section 9.7 Third Party Optional License Section 9.7 Updated Disclosure Schedule Section 10.3 Upfront Payment Section 7.1 U.S. Bulk Data Final Rule Section 10.4.4 Withholding Tax Action Section 7.10.1 1.3 Certain Rules of Interpretation in this Agreement and the Schedules. 1.3.1 Except where the context otherwise requires, wherever used, the singular will include the plural, the plural will include the singular, the use of any gender will be applicable to all genders and the word “or” is used in the inclusive sense (and/or). The words “include” and “including” have the inclusive meaning frequently identified with the phrases “without limitation” and “but not limited to”. The words “will” and “shall” have the same meaning. Whenever this Agreement refers to a number of days, unless otherwise specified, such number refers to calendar |
| 21 days. Unless otherwise specified, deadlines within which any payment is to be made or act is to be done within or following a specified time period after a date will be calculated by excluding the day, Business Day, month or year of such date, as applicable, and including the day, Business Day, month or year of the date on which the period ends. Whenever any payment is to be made or action to be taken under this Agreement is required to be made or taken on a day other than a Business Day, such payment will be made or action taken on the next Business Day following such day to make such payment or do such act. Reference to each Party’s respective territory refers, with respect to Haisco, to the Haisco Territory, and, with respect to Licensee, to the Territory and other countries or jurisdictions where Licensee has rights to Develop and Manufacture the Licensed Compounds or Licensed Products under this Agreement. Reference to a country refers to a country, region, or jurisdiction. 1.3.2 The preamble to this Agreement and the descriptive headings of Articles and Sections are inserted solely for convenience of reference and are not intended as complete or accurate descriptions of the content of this Agreement or of such Articles or Sections. Unless otherwise specified, references in this Agreement to any Article, Section, or Schedule means references to such Article, Section, or Schedule of this Agreement. ARTICLE II LICENSES 2.1 License Grants. Subject to the terms and conditions of this Agreement, on a Program-by-Program basis, effective as of the Effective Date, Haisco hereby grants to Licensee (a) an exclusive (even as to Haisco and its Affiliates), royalty-bearing license (which will be sublicensable through multiple tiers as provided in Section 2.3) under the Licensed Technology to Exploit any and all Licensed Compounds or Licensed Products of such Program in the Field in the Territory, and (b) a non-exclusive, royalty-bearing license (which will be sublicensable through multiple tiers as provided in Section 2.3) under the Licensed Technology to Develop (subject to Section 5.2) and Manufacture any and all Licensed Compounds or Licensed Products of such Program in the Field in the Haisco Territory solely for the purpose of Exploiting any and all Licensed Compounds or Licensed Products of such Program in the Field in the Territory. Haisco shall use its best efforts to avoid Exploiting any Licensed Compounds or Licensed Products, including any Licensee FDC Product, in the Field in the Territory. Subject to the terms and conditions of this Agreement, on a Program-by-Program basis, effective as of the Effective Date, Licensee hereby grants to Haisco a non-exclusive, royalty-free, fully-paid license under the Licensee Collaboration IP to Exploit any and all Licensed Compounds or Licensed Products of such Program in the Haisco Territory. Licensee shall not Exploit any Haisco FDC Product in the Field worldwide. 2.2 Haisco’s Retained Rights; No Implied Licenses. Notwithstanding Section 2.1, Haisco and its Affiliates hereby expressly reserve the right to (a) use or practice the Licensed Technology to perform its or its Affiliates’ obligations under this Agreement or any Ancillary Agreements, (b) Exploit any and all Licensed Compounds or Licensed Products in the Haisco Territory, (c) Exploit any and all Haisco FDC Products worldwide or (d) use or practice the Licensed Technology to Manufacture or have Manufactured any and all Licensed Compounds or Licensed Products in the Territory solely for the Exploitation of the Licensed Compounds or Licensed Products in the Field in the Haisco Territory. Except as expressly set forth herein, neither Party will acquire any license or other intellectual property interest, by implication or estoppel or otherwise, under or to any trademarks, Patents, Know-How, or other intellectual property rights Controlled by the other Party or its Affiliates. All such rights or licenses are or will be granted only as expressly provided in the terms of this Agreement. 2.3 Sublicense Rights. Subject to the terms of this Section 2.3, each Party may sublicense (through multiple tiers or to authorize sublicenses through multiple tiers) the license granted to such Party |
| 22 set forth in Section 2.1 (a “Sublicense”), to any of its Affiliates or to any Third Party without the other Party’s approval; provided that (a) if such Sublicense is within a Major Market and includes the right to Commercialize or sell the Licensed Product, the sublicensing Party will notify the other Party of the identity of any Sublicensee (or, in the case of Haisco, the applicable (sub)licensees) prior to entering into any Sublicense and shall consider in good faith any reasonable comments received from the other Party with respect thereto, (b) each Sublicense hereunder will be in writing, and consistent with and subject to the terms and conditions of this Agreement (including with respect to confidentiality and intellectual property rights), (c) each Sublicense granted to a Sublicensee (or, in the case of Haisco, the applicable (sub)licensees) will include the following additional terms and conditions: (i) the Sublicensee (or, in the case of Haisco, the applicable (sub)licensees) will be obligated to maintain accurate financial records such that Licensee can comply with its obligations under Section 7.11.1, and (ii) audit provisions consistent in all material respects with those set forth in Sections 7.12.1 and 7.12.2 and Haisco will have the right to request that Licensee or Licensee’s designee conduct audits in accordance therewith and Licensee will have the right to request that Haisco or Haisco’s designee conduct audits in accordance therewith. The sublicensing Party will provide the other Party with a copy of each Sublicense granted to a Sublicensee (or, in the case of Haisco, the applicable (sub)licensees) promptly after execution thereof (or execution of any amendment thereto), subject to the right to redact any confidential or proprietary information contained therein that is not necessary to determine the scope of the rights granted under such Sublicense or compliance with the terms of this Agreement. In no event will any Sublicense reduce, diminish, or modify any of the sublicensing Party’s obligations under this Agreement. Each Party will be responsible for any actions of its Affiliates and Sublicensees (or, in the case of Haisco, the applicable (sub)licensees) to the same extent as if such actions had been taken by such Party itself. 2.4 Subcontractors. Each Party and its Affiliates and its or their Sublicensees (or, in the case of Haisco, the applicable (sub)licensees) will have the right to freely engage Affiliates and Third Parties as Subcontractors to exercise its rights or perform its obligations under this Agreement. Each contract between a Party or its Affiliates or its or their Sublicensees (or, in the case of Haisco, the applicable (sub)licensees) granting the relevant subcontract and the relevant Subcontractor will be consistent with the provisions of this Agreement, and include provisions relating to confidentiality and intellectual property that are no less restrictive than those set forth in this Agreement (but only insofar as it pertains to the activities being performed by such Subcontractor; provided that such Subcontractor will not be required to assign to such Party, Affiliate or Sublicensee (or (sub)licensee in the case of Haisco), as applicable, any intellectual property that would customarily be retained by subcontractors, including improvements to such Subcontractor’s background intellectual property; provided that such Party or Affiliate otherwise acquires Control (which may include by way of a sublicensable license) of any such intellectual property that would be Know-How, Regulatory Documentation, Patents, or other intellectual property included in the licenses granted by such Party to the other Party under this Agreement if such Party or its Affiliates Controlled such intellectual property to, as applicable: (x) exploit the applicable deliverables of such Subcontractor to the extent such intellectual property is necessary to exploit such deliverables, or (y) Exploit the applicable Licensed Compound or Licensed Product to the extent such intellectual property is incorporated in such Licensed Compound or Licensed Product). Each Party will remain responsible for any obligations that have been delegated or subcontracted to any Subcontractor, and will be responsible for the performance of its Subcontractors. 2.5 Combination Rights. Notwithstanding any other provision of this Agreement, for purposes of the licenses granted under this Agreement with respect to the Licensed Compounds and Licensed Products, including under Section 2.1, and obligations to provide Know-How or Regulatory Documentation (or the grant of rights of reference thereto) with respect to the Licensed Compound and Licensed Product, as between the Licensed Compound component(s) and the Other Component(s) of a Combination Product, such license will only include rights under Licensed Technology or Licensee Collaboration IP, as applicable, and such obligations will only include provision of Know-How and |
| 23 Regulatory Documentation (and such grant of rights of reference thereto), specifically related to the Licensed Compound component(s) of such Combination Product (but not the Other Component(s) Controlled by a Party or any of its Affiliates contained therein) that are required by Applicable Law for seeking, obtaining or maintaining Regulatory Approval of the Licensed Compounds or Licensed Products that are not Combination Products in the Field in or for the Territory or the Haisco Territory, as applicable, or otherwise complying with the applicable regulatory requirements with respect to such Licensed Compounds or Licensed Products in the Territory or the Haisco Territory, as applicable. For clarity, the foregoing limitations in this Section 2.5 will apply with respect to any Other Component Controlled by a Party or any of its Affiliates, unless the Parties agree otherwise in a separate agreement or amendment to this Agreement regarding the licensing of such Other Component. For avoidance of doubt, neither Party grants to the other Party any license to the Other Component within a Haisco FDC Product or Licensee FDC Product, as applicable. 2.6 Territory Limitations. Unless otherwise agreed in this Agreement, each Party covenants that it, and its respective Affiliates and Sublicensees (or, in the case of Haisco, the applicable (sub)licensees), will Develop, Manufacture, and Commercialize the Licensed Compounds and Licensed Products solely within that Party’s respective territory, pursuant to and in accordance with the rights and licenses granted to it under and the terms and conditions of this Agreement. Unless otherwise agreed in this Agreement, each Party agrees and acknowledges that it has no rights (express or implied) to any Licensed Compounds or Licensed Products under this Agreement outside of its respective territory, and accordingly agrees that during the Term it will not (i) Commercialize any Licensed Product outside of its respective territory or within its respective territory for sale outside of its respective territory, or (ii) provide any Licensed Compounds or Licensed Products to any Third Party, or any of its respective Sublicensees (or, in the case of Haisco, the applicable (sub)licensees) or Affiliates, if such Party has actual knowledge or reasonably believes that such Third Party, Sublicensee (or, in the case of Haisco, the applicable (sub)licensees) or Affiliate, either directly or indirectly, is selling, or intends to sell such Licensed Compounds or Licensed Product outside said Party’s respective territory. 2.7 Non-Compete. 2.7.1 During the Term, Licensee shall not, and shall cause its Affiliates and Sublicensees not to, directly or indirectly, Exploit or assist any Third Party to Exploit, any compound or product that the primary mechanism of action of such compound or product is to bind to or functionally inhibit the (including any mutant, variant or isoform thereof) (each, a “Competing Product”), other than the Licensed Compounds and Licensed Products in accordance with this Agreement. 2.7.2 During the Term, if Licensee or any of its Affiliates is acquired by a Third Party through a Change of Control, and, as of the date of such Change of Control transaction,] the Acquirer (or any Affiliate of such Acquirer that is not an Affiliate of Licensee prior to such Change of Control) has a separate program with respect to a Competing Product in the Field worldwide or product that is under bona fide active development (each, an “Licensee COC Competing Product”) and that, but for this Section 2.7.2, would be in breach of Section 2.7.1 as a result of the continued Development, Manufacture or Commercialization of any such Licensee COC Competing Product by the Acquirer (or any Affiliate of such Acquirer that is not an Affiliate of Licensee prior to such Change of Control) then, Licensee (or its Affiliates) shall not be in breach of the provisions of Section 2.7.1 if (a) such Acquirer, within thirty (30) days after the Change of Control, provides written notice to Haisco that such Acquirer has rights to an Licensee COC Competing Product as a result of the Change of Control, (b) none of the Licensee Collaboration IP, Joint Collaboration IP, Confidential Information of Haisco or Licensed Technology (collectively, “Firewall Information”) is accessible to, provided to, or shared with any personnel working on the Licensee COC Competing [***] |
| 24 Product, and (c) such Competing Activities are conducted separately from the activities under this Agreement that Collaboration Personnel do not perform any Competing Activities and Competing Activities Personnel do not perform activities under this Agreement, and (d) such Acquirer implements Firewalls with respect to the Licensee COC Competing Product and its activities hereunder. 2.7.3 For purposes of this Section 2.7, the following definitions shall apply: (a) “Competing Activities” means any activities conducted by or on behalf of Licensee or its Affiliates (or an Acquirer in the event of a Change of Control) with respect to a Licensee COC Competing Product that, but for Section 2.7.2 would be a breach of Section 2.7.1. (b) “Firewalls” means effective walls and screens (whether technical or physical) established between (i) personnel of Licensee or its Affiliates performing activities or having access to any Firewall Information hereunder (“Collaboration Personnel”), on the one hand, and (ii) personnel performing Competing Activities on behalf of an Acquirer or having access to any non-public information or materials (such as lab notebooks, document management systems or other documented or memorialized Know-How) used by such Acquirer in the Competing Activities (“Competing Activities Personnel”), on the other hand, to ensure that no nonpublic information, materials (such as lab notebooks, document management systems or other documented or memorialized Know-How) or equipment or resources relating to a Licensed Compound or Confidential Information hereunder (including Firewall Information) are accessible by Competing Activities Personnel. For clarity, senior management personnel of the Licensee receiving or otherwise accessing any information, materials or resources to the extent necessary to enable, and solely for the purpose of, (x) compliance with this Agreement or Applicable Laws or (y) portfolio reviews, shall not be deemed to be breach of the Firewalls. “Firewall,” when used as a verb, means to implement Firewalls. ARTICLE III GOVERNANCE 3.1 Alliance Managers. Promptly following the Effective Date, each Party will designate an individual to act as the primary point of contact between the Parties (each such individual, an “Alliance Manager”) to facilitate the effective exchange of information between the Parties (including with respect to any written notifications or requests), discuss the Parties’ respective performance under this Agreement, assist with governance activities and serve as the initial point of contact to resolve any disputes between the Parties. Either Party may replace its designated Alliance Manager at any time by written notice to the other Party. 3.2 Joint Steering Committee. The Parties hereby establish a Joint Steering Committee (the “Joint Steering Committee” or the “JSC”). 3.2.1 Formation and Composition. Promptly following the Effective Date, but in any event within twenty (20) Business Days after the Effective Date, each Party will appoint its initial members of the JSC, which will be composed of at least two (2) (but not more than three (3)) members from each Party, and always an equal number of, appointed representatives of each of Licensee and Haisco. 3.2.2 Functions. The JSC will have the following responsibilities: |
| 25 (a) provide a forum for, and facilitate communications between, the Parties with respect to, the material Development and Manufacture of the Licensed Compounds and Licensed Products in the Territory and in the Haisco Territory; (b) review and discuss the material Development, Manufacturing and Commercialization updates of the Licensed Compounds and Licensed Products provided by the Parties in accordance with Section 3.2.3; (c) review and discuss all (i) Licensee Territory Development Plans and Crossed-Territory Global Development Plans, including all amendments or updates thereto, (ii) trial design and protocols for any Crossed-Territory Global Clinical Trials; (iii) trial design and protocols for any other Clinical Trials of Licensed Products conducted by or on behalf of Licensee, its Affiliates, or its or their Sublicensees , and (iv) new indications, formulations, and combinations to be Developed for Licensed Products in the Territory; (d) review and discuss all Material Development Issues; (e) review and discuss patent strategy for the Licensed Patents, including the preparation, filing, prosecution, and maintenance of such Licensed Patents, including without limitation, the filing of divisionals for such Licensed Patents to create Product-Specific Patents; (f) review and discuss regulatory updates, status, and strategy for the Licensed Compounds and Licensed Products in the Territory, including the progress of regulatory activities and any material regulatory developments relevant to the Licensed Products; (g) establish additional subcommittees to provide a forum for, and facilitate communications between, the Parties (provided, that the authority of such subcommittees cannot expand beyond the authority of the JSC; no such subcommittee has decision-making authority, and may only make recommendations to the JSC for its review and approval); (h) make a determination if an Affiliate or Third Party performing Subcontracted Activities constitutes a Company of Concern if escalated by the Parties to the JSC in accordance with Section 13.16.3; (i) decide matters where there is a major disagreement on a course of action that the Parties conduct or plan to conduct jointly, or that is conducted or planned to be conducted by or on behalf of a Party, its Affiliate, or its or their Sublicensees (or (sub)licensees in the case of Haisco) that reasonably affects the Exploitation of the Licensed Compounds or Licensed Products for the other Party’s territory (for clarity, in each case subject to Section 3.2.5); and (j) perform such other functions as are assigned to it in this Agreement or as appropriate to further the purposes of this Agreement to the extent agreed to in writing by the Parties. 3.2.3 JSC Meetings. The JSC will hold meetings at least once every Calendar Year, but no more than twice a Calendar Year, during the Term for so long as the JSC exists, unless the Parties mutually agree otherwise. The JSC may meet in person or by audio or video conference as its representatives may mutually agree. Other representatives of the Parties, their Affiliates and Third Parties involved in the Development, Manufacturing or Commercialization of Licensed Products may be invited by the members of the JSC to attend meetings as observers; provided, however, that such representatives are subject to confidentiality obligations no less stringent than those set forth herein. Each Party will provide the other Party with updates with respect to the |
| 26 Development, Manufacturing and Commercialization activities related to the Licensed Compounds and Licensed Products conducted by such Party, its Affiliates or (sub)licensees during each JSC meeting and each Party will consider the other Party’s comments thereto in good faith. 3.2.4 Decision-Making. Subject to the terms of this Section 3.2.4 and Section 3.2.5, with respect to matters within the JSC’s authority, actions to be taken and decisions made by the JSC will be taken or made only following a unanimous vote, with each Party’s representatives collectively having one (1) vote on behalf of such Party. For each meeting of the JSC, the attendance of at least one (1) representative of each Party will constitute a quorum. Action or decision on any matter may be taken at a meeting, in-person, by teleconference, videoconference, or by written consent. For clarity, the JSC will not have any power to amend, modify, or waive compliance with this Agreement. 3.2.5 JSC Disputes; Final Decision-Making Authority. With respect to any matter for which the JSC holds decision-making authority, if, after reasonable discussion and good faith consideration of each Party’s view on a particular matter before the JSC, the JSC cannot reach a decision as to such matter within thirty (30) days after such matter was brought to the JSC for resolution, either Party may elect to submit such matter to the Parties’ Designated Senior Officers. If a Party makes an election to refer a matter to the Designated Senior Officers, the Designated Senior Officers will use good faith efforts to promptly resolve such matter. If the Designated Senior Officers cannot resolve such matter within thirty (30) days after such matter has been referred to them, then the following will apply: (a) subject to Sections 3.2.5(c) and 3.2.6, Licensee will have final decision making authority for matters within the scope of the JSC’s decision-making authority to the extent related to the Development, Manufacture and Commercialization of the Licensed Compounds and the Licensed Products by Licensee, its Affiliates and Sublicensees in the Field in the Territory; provided that Licensee will not make any such decisions that would reasonably be expected to materially and adversely impact the Development, Manufacturing, Regulatory Approval, Commercialization or safety of the Licensed Compound or Licensed Products in the Haisco Territory, which such decisions will require the mutual agreement of the Parties; (b) subject to Sections 3.2.5(c) and 3.2.6, Haisco will have final decision making authority for matters within the scope of the JSC’s decision-making authority to the extent related to the Development, Manufacture and Commercialization of the Licensed Compounds and the Licensed Products by Haisco, its Affiliates and (sub)licensees in the Field in the Haisco Territory; provided that Haisco will not make any such decisions that would reasonably be expected to materially and adversely impact the Development, Manufacturing, Regulatory Approval, Commercialization or safety of the Licensed Compound or Licensed Products in the Territory, which such decisions will require the mutual agreement of the Parties; and (c) neither Party will exercise its final decision-making authority to: (i) impose any requirement that the other Party, its Affiliates, or its Sublicensee (or (sub)licensee in the case of Haisco) take any action that it reasonably believes would result in a violation of Applicable Law, or (ii) make any final and binding determination that the other Party has breached or has not breached this Agreement. 3.2.6 Limitations of Authority. All unresolved disputes within the scope of the JSC’s decision-making authority that are not subject to the final decision-making authority of the Parties under Section 3.2.5 will be subject to binding arbitration in accordance with Section 13.5; provided that either Party may first elect to refer such dispute to the Designated Senior Officers |
| 27 under Section 3.2.5. Notwithstanding any provision of this 3.2 to the contrary, the JSC will not have the authority to, and neither Party will have the right to exercise its final decision-making authority to (a) amend, modify, or waive compliance with, the terms or conditions of this Agreement, which may only be amended, modified, or waived as provided in Section 13.6 or 13.11, as applicable or (b) make a decision with respect to any matter for which it is expressly stated in this Agreement that such matter requires the mutual agreement, consent or approval of the Parties or agreement, consent or approval of the other Party under this Agreement. Each of the Parties will retain the rights, powers, and discretion granted to it under this Agreement and no such rights, powers, or discretion will be delegated to or vested in the JSC unless such delegation or vesting of rights is expressly provided for in this Agreement or the Parties otherwise expressly agree in writing. 3.2.7 Discontinuation of JSC. The JSC will disband upon the Parties’ mutual agreement in writing. After the disbandment of the JSC (which will disband any subcommittees as well), the exchange of information between the Parties will be made through the Alliance Managers, and all decisions of the JSC will be subject to the mutual agreement of the Parties; provided that each Party will continue to have its final decision-making authority in accordance with Section 3.2.5, subject to Section 3.2.6, which, in each case, will continue to apply mutatis mutandis. ARTICLE IV TECHNOLOGY TRANSFER 4.1 Initial Technology Transfer. Promptly after the Effective Date, but in any event within sixty (60) days therefrom for BRaf Program and within nine (9) months therefrom for CFBi Program, Haisco will initiate and complete the Initial Technology Transfer in accordance with a technology transfer plan as set forth on Schedule 4.1 attached hereto (each such plan, the “Technology Transfer Plan”). The Technology Transfer Plans will be subject to JSC oversight. “Successful Completion of the Initial Technology Transfer” with respect to a Program will be deemed to occur upon the date of receipt by Licensee or its designee of all Licensed Know-How and IND-Enabling Materials identified in Schedule 4.1 with respect to Licensed Compound, Licensed Materials, and any Licensed Products for such Program comprising or incorporating such Licensed Compounds. 4.1.1 Initial Knowledge Transfer. Without limiting the foregoing, on a Program-by-Program basis, at Haisco’s sole cost and expense, Haisco will provide to Licensee original-language copies of all Licensed Know-How (including Haisco Regulatory Documentation, CMC-related information and other data) existing as of the Execution Date and necessary or reasonably useful for Licensee to Develop Licensed Compounds or Licensed Products for such Program in the Territory, as listed on Schedule 4.1 attached hereto (the “Initial Knowledge Transfer”). Licensee may request in writing any Licensed Know-How included within the Initial Knowledge Transfer (as listed on Schedule 4.1) but not provided by Haisco, and Haisco will provide copies of such Licensed Know-How to Licensee no later than thirty (30) days following any such request (or such longer time period as Haisco may reasonably require). 4.1.2 IND Enabling Materials Transfer. Without limiting the foregoing, on a Program-by-Program basis,at Haisco’s sole cost and expense, Haisco will transfer to Licensee original-language copies of all IND enabling materials that (a) are Controlled by Haisco or its Affiliates as of the Execution Date (including all such IND enabling materials in the possession of Haisco’s Affiliates, (sub)licensees, subcontractors, and all Clinical Trial sites engaged by Haisco or any of the foregoing) and (b) are necessary or reasonably useful for Licensee to file an IND for the Licensed Products for such Program in the United States and Develop Licensed Compounds and Licensed Products for such Program therein, as identified on Schedule 4.1 attached hereto (such |
| 28 materials, the “IND Enabling Materials”, and such transfer, the “IND Enabling Materials Transfer”). 4.2 Manufacturing Technology Transfer. 4.2.1 Subject to Section 4.4, on a Program-by-Program basis, Haisco will provide to Licensee or its designee CMC-related technology and any associated manufacturing process technology, in each case, included in the Licensed Know-How that is necessary or reasonably useful for the Manufacture of Licensed Compounds and Licensed Products for such Program in the Territory in accordance with a manufacturing technology transfer plan as set forth on Schedule 4.2 attached hereto (each such plan, the “Manufacturing Technology Transfer Plan”, and such transfer, the “Manufacturing Technology Transfer”). The Manufacturing Technology Transfer Plans will be subject to JSC oversight. Each Party will use Commercially Reasonable Efforts to cooperate with the other Party in order to initiate the Manufacturing Technology Transfer within nine (9) months of Haisco’s receipt of the Upfront Payment. For clarity, the Parties may mutually agree to amend a Manufacturing Technology Transfer Plan, including the timeline for completion thereof. 4.2.2 “Successful Completion of the Manufacturing Technology Transfer” with respect to a Program will be deemed to occur on the date (x) and (y) below have both occurred: (x) the date that is three (3) months after delivery of all Licensed Know-How identified in the then-current Manufacturing Technology Transfer Plan for such Program (the “MTT Period”); provided that, during the MTT Period, Haisco will (a) as soon as reasonably practicable, provide Licensee with such other Licensed Know-How for such Program in possession of Haisco or any of its Affiliates or its or their contract manufacturers reasonably requested by Licensee’s designated contract manufacturer pursuant to an updated Manufacturing Technology Transfer Plan for the Manufacture of the first engineering batch of Licensed Product for such Program, and (b) upon request, provide reasonable consultation to Licensee’s designated contract manufacturer with respect to the Manufacture of the applicable Licensed Compound(s) or Licensed Product(s) for such Program; provided that, in each case ((a) and (b)), any such request shall be made no later than seventy-five (75) days following Haisco’s delivery of all Licensed Know-How identified in the then-current Manufacturing Technology Transfer Plan, and (y) to the extent not already executed, the Parties execute the Clinical Supply Agreement and Quality Agreement. In the event the actions described in the proviso in clause (x) above are not fully performed during the MTT Period, the MTT Period will be extended for as long as necessary until such actions are fully performed. On a Program-by-Program basis, following Successful Completion of the Manufacturing Technology Transfer, Haisco will, subject to Section 4.4, continue to provide to Licensee and Licensee’s designated contract manufacturer reasonable assistance in connection with a Manufacturing Technology Transfer until such contract manufacturer manufactures and releases a batch of Licensed Product for such Program manufactured in accordance with cGMP and meeting the product specification and other quality attributes set forth in the applicable Manufacturing Technology Transfer Plan. 4.2.3 On a Program-by-Program basis, following the initial Manufacturing Technology Transfer as described above, if Licensee undergoes a Change of Control event or grants an exclusive Sublicense to a Third Party for the Manufacture of one or more Licensed Compounds and Licensed Products, Licensee will have the right to reasonably request Haisco to perform a second Manufacturing Technology Transfer for such Program to such Third Party or its designee, and upon receipt of such request, Haisco will, at Licensee’s or such Third Party’s sole cost and expense, perform such Manufacturing Technology Transfer for such Program, and, without limiting |
| 29 the foregoing, the Parties will discuss in good faith and agree on a manufacturing technology transfer plan for such Manufacturing Technology Transfer. 4.3 Continuing Knowledge Transfer. On a Program-by-Program basis, subject to Sections 4.4 and 4.5, during the Term, Haisco will transfer to Licensee any additional Licensed Know-How for such Program (including Regulatory Documentation, CMC-related technology, and any associated manufacturing process technology) that has not been previously transferred to Licensee as soon as reasonably practicable after (a) such additional Licensed Know-How for such Program first comes into the Control of Haisco or any of its Affiliates, or (b) a previous failure to transfer such Licensed Know-How for such Program is discovered (the “Continuing Knowledge Transfer”). 4.4 Cooperation and Assistance. On a Program-by-Program basis, at Licensee’s reasonable request, Haisco will provide Licensee and its designees with reasonable assistance with respect to each Knowledge Transfer described in Sections 4.1 through 4.3 (inclusive), including by providing Licensee and its designees with reasonable access by teleconference or videoconference (or, to the extent requested by Licensee, in-person meetings) to personnel of Haisco, its Affiliates or any of its Third Party contractors involved in Development or Manufacturing matters related to the Licensed Know-How for such Program (if agreed by such Third Party contractors), as applied to Licensed Compounds and Licensed Products for such Program, to provide a reasonable level of technical assistance and consultation in connection with such Knowledge Transfer. In addition to the Knowledge Transfer, on a Program-by-Program basis, upon the reasonable request of Licensee, Haisco will provide Licensee with reasonable technical assistance in connection with the Licensed Know-How for such Program and the Development of the Licensed Compounds and the Licensed Products for such Program in the Field in or for the Territory. With respect to assistance and consultation provided by Haisco, its Affiliates or any of its Third Party contractors to Licensee or its designees under this Sections 4.2, 4.3, and 4.4, on a Program-by-Program basis, Haisco will provide Licensee with fifty (50) hours free support (the “Free Support”). Licensee will reimburse Haisco for Haisco’s FTE Costs beyond the Free Support and reasonable, documented out-of-pocket costs incurred by Haisco in providing such assistance and consultation to Licensee or its designees. 4.5 English Translation. For any Know-How (including Regulatory Documentation, CMC-related information and other data) that a Party is required to transfer to or share with the other Party under this Agreement (including as set forth in this ARTICLE IV and Section 5.4), if such Know-How is written in a language other than English and the English-language copy of such Know-How exists prior to or as of the Execution Date, such Party will provide the other Party with such English-language copy “as is.” With respect to any Licensed Know-How (including Regulatory Documentation, CMC-related information and other data) written in a language other than English for which an English-language copy does not exist prior to the Execution Date, Haisco will provide an English-language translation to Licensee at Licensee’s sole expense (Haisco will invoice Licensee for the actual FTE Costs and external costs incurred in creating such translation and Licensee will make the correspondence payment within thirty (30) days of receipt of such invoice). ARTICLE V DEVELOPMENT AND REGULATORY MATTERS 5.1 Research and Development Responsibilities. Effective from Effective Date: 5.1.1 Subject to the terms and conditions of this Agreement, on a Program-by-Program basis, Licensee will be solely responsible for the Development of the Licensed Compounds and the Licensed Products for such Program in the Field in or for the Territory conducted by or on behalf of Licensee at its own cost and expense. Subject to the terms and conditions of this Agreement, on a Program-by-Program basis, Haisco will be solely responsible for the Development of the |
| 30 Licensed Compounds and the Licensed Products for such Program in the Field in the Haisco Territory conducted by or on behalf of Haisco at its own cost and expense. 5.1.2 On a Program-by-Program basis, Licensee may conduct Development in the Haisco Territory, either by Licensee itself or through Licensee’s Subcontractors, solely to support the Development and Commercialization of the Licensed Compound and/or Licensed Products for such Program within the Territory. On a Program-by-Program basis, Haisco’s prior written consent is required for any such Development activities in the Haisco Territory by Licensee or its Subcontractors that would reasonably be anticipated to impair Haisco’s right and ability to Develop, Manufacture, Commercialize or otherwise Exploit the License Compound or Licensed Products for such Program in the Haisco Territory. 5.2 Global Development; Crossed-Territory Development. Subject to the terms and conditions of this Agreement, effective as of the Effective Date: 5.2.1 On a Program-by-Program basis, if the Parties agree to coordinate any specific Development activities for the benefit of the Licensed Products in both Parties’ territories, the Parties will negotiate in good faith and agree on the details of such activities, including allocation of responsibilities, budget and cost sharing. Without limiting the generality of the foregoing, if Licensee intends to conduct any Global Clinical Trial involving one or more jurisdictions in the Haisco Territory and one or more jurisdictions in the Territory (“Crossed-Territory Global Clinical Trial”), it will notify Haisco thereof in writing and the Parties will discuss whether or not to jointly conduct such Global Clinical Trial. 5.2.2 To the extent that Haisco and Licensee mutually agree to jointly conduct any Crossed-Territory Global Clinical Trial of a Licensed Product for a Program after the Effective Date, (i) the Parties will conduct such Crossed-Territory Global Clinical Trial in accordance with a global development plan mutually agreed by the Parties (“Crossed-Territory Global Development Plan”), under which, inter alias, Haisco will contribute an agreed percentage of the total trial subjects for such Crossed-Territory Global Clinical Trial or a similar percentage of the shared costs of such Crossed-Territory Global Clinical Trial that Haisco agrees to participate in; and (ii) the data generated from the performance of such Crossed-Territory Global Clinical Trial (“Global Clinical Trial Data”) will be automatically included in the Licensee Collaboration IP and licensed to Haisco under Section 2.1. The Crossed-Territory Global Development Plan will be subject to JSC oversight. Haisco’s share of the total trial subjects and shared costs of such Crossed-Territory Global Clinical Trial will be determined on a case-by-case basis and mutually agreed upon by the Parties. In the event the Parties do not mutually agree to conduct a Crossed-Territory Global Clinical Trial, all Global Clinical Trial Data resulting from such Crossed-Territory Global Clinical Trial that is Controlled by Licensee or its Affiliates will be included in Licensee Collaboration IP and shared with Haisco in accordance with Section 5.4. 5.2.3 Notwithstanding anything to the contrary in this Agreement, regardless of whether the Parties agree to mutually conduct any Crossed-Territory Global Clinical Trial or include any Global Clinical Trial Data in the Licensee Collaboration IP, Haisco and its designees will have the right to use the safety and other data generated from any Crossed-Territory Global Clinical Trials (“Global Clinical Trial Safety Data”) for safety reporting or other purposes to the extent required by Applicable Law or a Regulatory Authority in the Haisco Territory, and Licensee and its designees will have the right to use Global Clinical Trial Safety Data for safety reporting or other purposes to the extent required by Applicable Law or a Regulatory Authority in the Territory. |
| 31 5.2.4 Neither Party will conduct any Clinical Trial of Licensed Products that is not a Crossed-Territory Global Clinical Trial in the other Party’s territory without such other Party’s prior written consent, not to be unreasonably withheld, delayed, or conditioned. If the Parties mutually agree that a Party may conduct any Clinical Trial of Licensed Products that is not Crossed-Territory Global Clinical Trial in the other Party’s territory, prior to conducting any such Clinical Trial, the Parties will mutually agree on the trial design and protocol of such Clinical Trial, and each Party will not unreasonably withhold, delay, or condition its agreement thereto. 5.3 Diligence; Development Plans and Reports. 5.3.1 Licensee will use Commercially Reasonable Efforts to (a) complete the Financing Closing on or before thirty (30) Business Days following the Execution Date, and (b) complete the Subsequent Financing Closing within six (6) months following the Effective Date. Licensee shall provide Haisco prompt written notice of the completion of each Financing Closing and Subsequent Financing Closing within two (2) Business Days thereof. 5.3.2 Effective as of the Effective Date, on a Program-by-Program basis, Licensee will, by itself or through any of its Affiliates or their Sublicensees, use Commercially Reasonable Efforts to Develop and obtain Regulatory Approval for, and, after obtaining Regulatory Approval, Commercialize at least one (1) Licensed Product in the Territory. 5.3.3 Effective as of the Effective Date, subject to JSC oversight as set forth in Section 3.2, on a Program-by-Program basis, Licensee shall carry out any Development activities of the Licensed Compound and Licensed Products for such Program in and for the Territory under this Agreement consistent with a development plan, the initial agreed versions of which are attached as Schedule 5.3.3 (such plans, as amended from time to time, the “Licensee Territory Development Plan”), which development plan will set forth with reasonable details, inter alia, all material Development activities (including all in vivo studies and Clinical Trials) to be conducted by or on behalf of Licensee in order to obtain Regulatory Approvals for the applicable Licensed Products for such Program in the Field in the Territory, including: (i) a high level summary of all regulatory strategies, preclinical studies, toxicology, pharmacology studies, formulation, process development, and clinical studies to support Regulatory Approval for such Program in the Territory; (ii) a description of all Clinical Trials to be conducted or on behalf of Licensee to support Regulatory Approval for such Program in the Territory and related timelines; (iii) other material activities necessary for Development of the Licensed Product for such Program in the Territory; and (iv) such other information as Haisco may reasonably request related to the Development of the Licensed Products for such Program in the Field in the Territory. Licensee may propose to amend or update its Licensee Territory Development Plans; provided that, (i) any such proposals will be consistent with Licensee’s obligations under this Agreement (including, with respect to Licensee, its diligence obligations) and (ii) Licensee will provide Haisco with the proposal of an updated Licensee Territory Development Plan at the next regularly-scheduled meeting of the JSC and such proposal shall be decided and approved by the JSC. 5.3.4 On a Program-by-Program basis, beginning on the Effective Date and ending on the First Commercial Sale of a Licensed Product, Licensee will, on an annual basis, provide Haisco with a detailed written report regarding the progress of its Development activities for such Program within thirty (30) days after each applicable Calendar Year, which report will be at a level of detail reasonably requested by Haisco and sufficient to enable Haisco to determine Licensee’s compliance with its diligence obligations under this Agreement. For clarity, each report shall include, at a minimum, the following information for the Licensed Compound and each Licensed Product for such Program: (a) a description of the material Development activities for each |
| 32 Licensed Product for such Program during the applicable time period in reasonable detail, including non-clinical studies, Clinical Trials, clinical related profiles (including but not limited to protocol, enrollment progress, PK/PD data, safety data, efficacy data (with original images), CSR), formulation work, other testing work and regulatory activity; (b) a description of the Manufacture activities for the Licensed Compound and Licensed Products for such Program in reasonable detail; (c) annual expenditure for the foregoing activities in reasonable detail; (d) relevant testing data, regulatory documentation, backup calculations and other reasonable supporting documentation for the foregoing information; and (e) such other information as Haisco may reasonably request related to the Development of the Licensed Compound and Licensed Products for such Program in the Field in the Territory. 5.4 Development Record; Data Exchange and Use. Effective as of the Effective Date, on a Program-by-Program basis, each Party will maintain complete, current and accurate records of all Development activities for such Program conducted by or on behalf of it under this Agreement, and all Know-How resulting from such activities. Such records will fully and properly reflect all work done and results achieved in the performance of the Development activities for such Program in good scientific manner appropriate for regulatory and patent purposes. On a Program-by-Program basis, each Party will, and will ensure that its Affiliates and Sublicensees (and the applicable (sub)licensees in the case of Haisco) will, document all non-clinical studies and clinical trials in formal written study records in accordance with all Applicable Laws, including applicable national and international guidelines such as ICH and the applicable cGCP and cGLP. To the extent permitted by Applicable Laws, each Party will use Commercially Reasonable Efforts (or, in the case of Licensee and with respect to Clinical Trials that are listed and described on Schedule 5.3.3, in accordance with Licensee Territory Development Plan) to collect or cause to be collected, and acquire Control of, all images and data from all study subjects participating in Clinical Trials for Licensed Products for such Program conducted by or on behalf of it under this Agreement; provided that a Party will not have any liability under this Agreement and will not be held liable for breach of this Agreement in the event that such Party fails to collect or cause to be collected such images and data (so long as such Party has used Commercially Reasonable Efforts to discuss and negotiate with the relevant site an agreement that allows such Party to collect or cause to be collected such images and data from study subjects participating in the relevant Clinical Trial). On a Program-by-Program basis, as between the Parties, each Party will own all data generated by such Party in its Development of the Licensed Compounds and the Licensed Products for such Program in the Field in or for its respective territory. On a Program-by-Program basis, subject to compliance with Applicable Law and Sections 10.3 and 5.2, each Party will, upon reasonable request of the other Party, provide the other Party with original-language copies of all material data and results (including pre-clinical, clinical, and non-clinical data) that are (a) Controlled by such Party or its Affiliates, (b) generated in its or its Affiliates’ and Sublicensees’ (or, in the case of Haisco, the applicable (sub)licensees’) Development of the Licensed Compounds and the Licensed Products for such Program in the Field in or for its respective territory, but excluding any data and results generated in connection with its or its Affiliates’ and Sublicensees’ (or, in the case of Haisco, the applicable (sub)licensees’) Development of a Combination Product other than data and results specifically related to the Licensed Compound component(s) of such Combination Product (but not the Other Component(s) Controlled by a Party or any of its Affiliates contained therein) that are not required by Applicable Law for seeking, obtaining or maintaining Regulatory Approval of the Licensed Compounds or Licensed Products that are not Combination Products in the Field in or for the Territory or the Haisco Territory, as applicable, or otherwise complying with the applicable regulatory requirements with respect to such Licensed Compounds or Licensed Products in the Territory or the Haisco Territory, as applicable, and (c) necessary or reasonably useful for the Development of the Licensed Compounds and the Licensed Products for such Program in or for such other Party’s territory, including all supporting documentation (collectively, “Development Data”). For clarity, all Development Data Controlled by Haisco or any of its Affiliates will be deemed Licensed Know-How and, subject to |
| 33 Section 5.2 with respect to Global Clinical Trial Data Controlled by Licensee or its Affiliates, all Development Data Controlled by Licensee or its Affiliates will be deemed Licensee Collaboration IP. In addition to the licenses granted under Section 2.1, subject to Section 5.2 with respect to Global Clinical Trial Data Controlled by Licensee or its Affiliates, on a Program-by-Program basis, each Party will have the right to use the Development Data provided by the other Party pursuant to this Section 5.4 for the purpose of Developing, obtaining and maintaining Regulatory Approvals for, and Commercializing the Licensed Compounds and the Licensed Products for such Program in the Field in the Haisco Territory (in the case of Haisco) or the Territory (in the case of Licensee), including fundraising, sublicensing, and other business development activities of such Party related to the Licensed Compounds and the Licensed Products for such Program. For the sake of clarity, with respect to Licensee, the foregoing right will include the Development Data from Haisco’s ongoing Phase 3 Clinical Trial for the Licensed Product in the Haisco Territory. Any cost incurred by either Party in providing Development Data pursuant to this Section 5.4, including out-of-pocket cost and internal cost, will be borne by such Party; provided however, (i) if any Development Data requested by Licensee requires Haisco to conduct any new non-clinical studies, new pharmacology clinical studies or other new studies of the Licensed Compounds or Licensed Products in the Haisco Territory, in each case after the Effective Date, solely for Licensee to obtain Regulatory Approvals for the Licensed Products in the Territory, the costs of such studies shall be borne by Licensee, and (ii) if any Development Data generated by any new non-clinical studies, new pharmacology clinical studies or other new studies of the Licensed Compounds or Licensed Products can be utilized by both Parties for obtaining Regulatory Approvals both inside and outside the Territory as otherwise agreed in writing by the Parties, the costs of such studies shall be shared by both Parties. To the extent any material Development Data or Regulatory Documentation provided pursuant to this Section 5.4 is originally generated in a language other than English, the providing Party shall, promptly upon reasonable request by the other Party, provide an English translation thereof of sufficient quality to permit regulatory, safety, and business review. 5.5 Regulatory Responsibilities. Effective from Effective Date: 5.5.1 On a Program-by-Program basis, as between the Parties, Licensee will have the sole right and responsibility to perform all regulatory activities with respect to all Licensed Compounds or Licensed Products for such Program in or for the Territory, including (a) conducting all correspondence, meetings, teleconferences and other communications with Regulatory Authorities, and (b) filing all INDs, NDAs and other filings with Regulatory Authorities, in each case of clauses (a) and (b) above, regarding Licensed Compounds and Licensed Products for such Program in or for the Territory. On a Program-by-Program basis, as between the Parties, Haisco will have the sole right and responsibility, at its cost, to perform all regulatory activities with respect to all Licensed Compounds or Licensed Products for such Program in the Field in the Haisco Territory, including (i) conducting all correspondence, meetings, teleconferences and other communications with Regulatory Authorities, and (ii) filing all INDs, NDAs and other filings with Regulatory Authorities, in each case of clauses (i) and (ii) above, regarding Licensed Compounds and Licensed Products for such Program in the Field in the Haisco Territory. Haisco shall have no responsibility and no obligation to support any regulatory activities of Licensee in or for the Territory, including but not limited to making its facilities, personnel or records available for inspection by any Regulatory Authority of the Territory, whether at the request of Licensee or such Regulatory Authority. 5.5.2 On a Program-by-Program basis, with respect to any Development or Manufacturing activities that support the Development and Commercialization of the Licensed Compound or Licensed Products for such Program within the Territory conducted by or on behalf of Licensee or any of its Affiliates or Sublicensees in the Haisco Territory, Licensee shall keep Haisco fully informed of any regulatory submissions and communications with Regulatory Authorities in the Haisco Territory. The Parties acknowledge and agree that the conduct of such |
| 34 Development or Manufacturing activities in the Haisco Territory requires Haisco’s prior written consent if such activities would reasonably be anticipated to impair Haisco’s right and ability to Develop, Manufacture, Commercialize or otherwise Exploit the License Compound or Licensed Products for such Program in the Haisco Territory. Licensee shall provide Haisco with sufficient advance notice and time to review and comment on all such material submissions to and communications with any Regulatory Authority in the Haisco Territory and shall, and shall cause its Affiliates and Sublicensees to, consider Haisco’s comments in good faith. In addition, Licensee shall, no more than five (5) Business Days after the submission or receipt, provide Haisco with copies of all material documents, submissions, filings, information and correspondence related to any Licensed Compound or Licensed Product for such Program submitted to or received from a Regulatory Authority in the Haisco Territory by Licensee or any of its Affiliate or Sublicensees. Licensee shall provide Haisco with notice of any meeting or discussion with any Regulatory Authority in the Haisco Territory related to any Licensed Compound or Licensed Product for such Program no later than two (2) Business Days after receiving notice thereof. Haisco shall have the right, but not the obligation, to attend and participate in any such meeting or discussion. 5.6 Right of Reference. Subject to Section 5.2 with respect to Global Clinical Trial Data Controlled by Licensee or its Affiliates, on a Program-by-Program basis, effective from Effective Date, each Party hereby grants to the other Party the right of reference to all Regulatory Documentation Controlled by such Party or its Affiliates pertaining to the Licensed Compounds or Licensed Products, including any Licensee FDC Product, for such Program submitted by or on behalf of such Party or any of its Affiliates or Sublicensees (or the applicable (sub)licensees in the case of Haisco) or pertaining to the Haisco FDC Product submitted by or on behalf of Haisco or any of its Affiliates or applicable (sub)licensees. Licensee may use such right of reference solely for the purpose of seeking, obtaining and maintaining Regulatory Approval, if applicable, of the Licensed Compounds or Licensed Products for such Program in the Field in or for the Territory. Haisco may use such right of reference solely for the purpose of seeking, obtaining and maintaining Regulatory Approval, if applicable, for the Licensed Products for such Program in the Field in the Haisco Territory and the Haisco FDC Product in the Field worldwide. Each Party will take such actions as may be reasonably requested by the other Party to give effect to the intent of this Section 5.6. For clarity, the foregoing right will also exclude any part of the Regulatory Documentation to the extent specifically related to the Other Component(s) Controlled by a Party or any of its Affiliates of any Combination Product unless such part of the Regulatory Documentation is required by the Applicable Law for seeking, obtaining or maintaining Regulatory Approval of the Licensed Compounds or Licensed Products or Haisco FDC Products that are not Combination Products in the Field in or for the Territory or the Haisco Territory, as applicable, or otherwise complying with regulatory requirements in the Territory or the Haisco Territory, as applicable. 5.7 Safety; Adverse Event Reporting. On a Program-by-Program basis, promptly following the Effective Date, but in any event no later than sixty (60) days thereafter, the Parties will enter into a pharmacovigilance and adverse event reporting agreement setting forth the worldwide pharmacovigilance procedures for the Parties with respect to the Licensed Products for such Program, including that each Party will establish and maintain its own global safety database for the Licensed Products for such Program, safety data sharing, adverse events reporting and prescription events monitoring (the “Pharmacovigilance Agreement”). Such procedures will be in accordance with, and enable the Parties to fulfill, local and national regulatory reporting obligations under Applicable Laws. Each Party will hold the primary responsibility for reporting quality complaints, adverse events and safety data related to the Licensed Products for such Program in its territory to such database and to the applicable Regulatory Authorities in its territory, as well as responding to safety issues and to all requests of Regulatory Authorities in its territory related to the Licensed Products for such Program, in each case at its own cost and to the extent required by the Applicable Laws. Each Party agrees to comply with its respective obligations under the |
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| 47 7.9 Payment Method. All payments by Licensee to Haisco under this Agreement will be paid in Dollars, and all such payments will be made by bank wire transfer in immediately available funds to the bank account designated by Haisco in writing; provided that such account information is provided to Licensee at least thirty (30) days prior to any such payment becoming due hereunder. 7.10 Taxes. 7.10.1 General. Subject to the remainder of this Section 7.10.1, in the event that Licensee is required, under Applicable Law, to withhold any deduction or tax from any payment due to Haisco under this Agreement, such amount will be deducted from the payment to be made by Licensee, paid to the proper taxing authority, and Licensee will promptly provide Haisco with copies of any tax certificate or other documentation evidencing such payment. Except as otherwise provided in this Section 7.10.1, any such required withholding taxes will be at the sole expense of, and borne by Haisco. Notwithstanding the foregoing, the Parties acknowledge and agree that if (a) Licensee undertakes any restructuring, redomiciling, reorganization or other action (but expressly excluding a Change of Control of Licensee), and thereafter any payment made by Licensee to Haisco under this Agreement is subject to a deduction or withholding of tax, and such deduction or withholding obligation results in the amount of such payment received by Haisco being less than the amount of such payment that Haisco would have received had no such action occurred (after any applicable deduction or withholding of tax that would have applied had no such action occurred) (such action, a “Withholding Tax Action”), then notwithstanding anything to the contrary herein, the payment owed by Licensee (in respect of which such deduction and withholding of tax is required to be made) will be increased to take into account such increased withholding taxes as may be necessary to ensure that, after making all required withholdings (including withholdings on additional amounts), Haisco (or its assignee, Affiliate, or successor) receives an amount equal to the same amount that it would have received had no Withholding Tax Action occurred. The Parties agree to cooperate in claiming refunds or exemptions from, or reductions in, any deductions or withholdings under any Applicable Law or treaty to ensure that any amounts required to be withheld pursuant to this Section 7.10.1 are reduced to the fullest extent permitted by Applicable Law. 7.10.2 Indirect Taxes. All payment amounts are exclusive of any sales, use, value-added, goods and services, gross receipts and similar turnover or gross margin taxes, together with any penalties and interest in respect thereof (each an “Indirect Tax”). If any amount of Indirect Tax is chargeable in respect of a payment, Licensee will pay such Indirect Tax at the applicable rate in respect of such payment following the receipt of an invoice in the appropriate form as required under Applicable Law from Haisco in respect of those payments, such Indirect Tax to be payable on the later of (a) the due date of the payment to which such Indirect Tax relates and (b) 30 days after the receipt by Licensee of the applicable invoice setting forth the amount of the applicable Indirect Tax. The Parties will use commercially reasonable efforts to cooperate to minimize Indirect Taxes in connection with this Agreement, as applicable, including applying for an exemption to any value-added taxes. 7.10.3 Tax Allocation and Characterization. Licensee will allocate payment amounts among the jurisdictions in the Territory in accordance with Applicable Law and will not withhold United States taxes on any amounts that can be properly allocated to a non-United States jurisdiction or that can be properly characterized as proceeds from the sale of a capital asset. The Parties acknowledge and agree that, unless otherwise required by (a) a change in Applicable Law after the date hereof or (b) a “determination” within the meaning of Section 1313 of the Internal Revenue Code of 1986, as amended, (1) the following payments will not be subject to United States withholding taxes, provided that Haisco provides a valid Internal Revenue Service Form W-8BEN-E: (i) the upfront payment payable pursuant to Section 7.1, and (ii) the Development Milestone |
| 48 Payments payable pursuant to Section 7.2, and (2) the Commercial Milestone Payments payable pursuant to Section 7.3, Sublicense Revenue pursuant to Section 7.4, and royalties payable pursuant to Section 7.5, in each case will be apportioned reasonably based on the country or countries in which the underlying Net Sales were made. 7.10.4 Tax Treatment. For U.S. income tax purposes solely, both Parties agree that this Agreement will constitute a taxable sale of the Licensed Technology from Haisco to Licensee in exchange for the consideration described in Section 7.1 through Section 7.6. 7.11 Reports. 7.11.1 On a Program-by-Program basis, commencing as of the First Commercial Sale, for so long as any Royalty Term remains in effect for a given Licensed Product, Licensee will, with respect to each Calendar Quarter (or portion thereof), provide a written report to Haisco showing (a) the amount of the gross and Net Sales of the Licensed Product, on a Licensed Product-by-Licensed Product and country-by-country basis, during such Calendar Quarter (including such amounts expressed in local currency and as converted to Dollars and the specific deductions applied in the calculation of such Net Sales amounts); (b) the applicable royalty rates for each Licensed Product in each country after applying any permitted deductions set forth in Section 7.6; (c) a calculation of the royalties which will have accrued hereunder with respect to Net Sales due to Haisco with respect to such Licensed Product for such Calendar Quarter; (d) the withholding taxes, if any, required by law to be deducted in respect of such royalties; and (e) the exchange rates (as determined pursuant to Section 7.7 herein) used in determining the royalty amount expressed in Dollars (each, a “Royalty Report”). 7.11.2 Royalty Reports will be due within forty-five (45) days following the end of the Calendar Quarter to which such Royalty Report relates. During the Term and for three (3) years thereafter, Licensee will, and will cause its Affiliates and Sublicensees to, keep complete and accurate records in sufficient detail to properly reflect all gross sales, Net Sales and royalty rate calculations and to enable the royalties and other payments payable hereunder to be determined. 7.12 Audits. 7.12.1 Upon the written request of one Party (the “Auditing Party”) and with at least thirty (30) days’ prior written notice, but not more than once in any Calendar Year, the other Party (the “Audited Party”) will permit an independent certified public accounting firm of internationally recognized standing, selected by the Auditing Party and reasonably acceptable to the Audited Party, at the Auditing Party’s sole cost and expense (except as set forth in this Section 7.12), to have access during normal business hours to such of the records of the Audited Party and its Affiliates as required to be maintained under this Agreement to verify the accuracy of the Royalty Reports, royalties, and any other payments due hereunder and any invoices submitted by Audited Party to the Auditing Party. Such accountants may audit only records relating to Royalty Reports, invoices, or payments made for the three (3) prior Calendar Years that have not been previously audited by the Auditing Party. The accounting firm will disclose to the Auditing Party only whether the Royalty Reports, invoices or payments (as applicable) were correct or not, and the specific details concerning any discrepancies and such information will be shared at the same time with the Audited Party. No other information obtained by such accountants will be shared with the Auditing Party without the prior consent of the Audited Party unless disclosure is required by Applicable Laws or judicial order. All information disclosed in connection with an audit may be used solely for purposes of verifying compliance with this Agreement. |
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| 50 ARTICLE VIII CONFIDENTIALITY 8.1 Non-Disclosure Obligations. 8.1.1 Except as otherwise provided in this ARTICLE VIII, during the Term and for a period of seven (7) years thereafter, each Party and their respective Affiliates will maintain in confidence, and use only for purposes as expressly authorized and contemplated by this Agreement (including for performing such Party’s obligations and exercising such Party’s rights under this Agreement or any Ancillary Agreements (it being understood that Haisco will have the right to use the Product-Specific Licensed Know-How for the Exploitation of any Licensed Compound or Licensed Product in the Haisco Territory or Manufacture of any Licensed Compound or Licensed Product in the Territory for the Exploitation thereof in the Haisco Territory or Terminated Territory)), all Confidential Information of the other Party with respect to such Program. Notwithstanding the foregoing seven (7)-year period, the confidentiality obligations with respect to the Licensed Know-How that constitutes a trade secret under Applicable Law shall survive for as long as such Licensed Know-How remains a trade secret under Applicable Law. Without limiting the foregoing, each Party will use at least the same standard of care as it uses to protect its own Confidential Information to ensure that its and its Affiliates’ employees, agents, consultants, clinical investigators and any sublicensees or subcontractors only make use of the other Party’s Confidential Information for purposes as expressly licensed or otherwise authorized, and do not disclose or make any unauthorized use of such Confidential Information. Each Party will use Commercially Reasonable Efforts to maintain the confidentiality and proprietary nature of the Licensed Know-How and Licensee Collaboration IP. 8.1.2 “Confidential Information” means all technical, business or other information, including confidential or proprietary Know-How (including the terms of this Agreement and information relating to such Party’s or its Affiliates’ research programs, development, marketing and other business practices and finances), data, documents or other materials, disclosed or supplied by the other Party or its Affiliates or their sublicensees, whether orally, in writing or in electronic form and whether prior to, on or after the Execution Date, under or in connection with this Agreement or the CDA; provided that notwithstanding anything to the contrary, (a) any Licensed Know-How that is solely related and specific to any of the Licensed Compounds or Licensed Products (other than, for clarity, Know-How related to any Other Components contained therein) (such Licensed Know-How, collectively, “Product-Specific Licensed Know-How”) will be considered (i) the Confidential Information of Licensee and Haisco during the Term (with respect to which each Party will be deemed a disclosing Party and a receiving Party) and (ii) the Confidential Information of Haisco after the Term (with respect to which Licensee will be deemed the receiving Party and, notwithstanding the first sentence of Section 8.1.1, Haisco’s confidentiality and non-use obligations thereunder will terminate immediately thereafter); (b) any Know-How and Regulatory Documentation included in the Licensee Collaboration IP will be considered the Confidential Information of Licensee (with respect to which Licensee will be deemed the disclosing Party and Haisco will be deemed the receiving Party); and (c) any Joint Collaboration IP, as well as any terms and conditions of this Agreement, will be deemed the Confidential Information of Licensee and Haisco (with respect to which each Party will be deemed a disclosing Party and a receiving Party). 8.2 Permitted Disclosures. |
| 51 8.2.1 Notwithstanding the foregoing, the provisions of Section 8.1 will not apply to Confidential Information of the disclosing Party that the receiving Party can establish by competent written proof: (a) have become published or otherwise entered the public domain or become generally available to the public other than by breach of this Agreement, wrongful act, fault or negligence by or on the part of the receiving Party or its Affiliates, Sublicensees (or (sub)licensees in the case of Haisco) or any other Persons to whom the receiving Party or any of its Affiliates or Sublicensees (or (sub)licensees in the case of Haisco) has disclosed the relevant Confidential Information; (b) are permitted to be disclosed by prior written consent of the other Party in writing; (c) have become known to the receiving Party by a Third Party; provided that such Confidential Information was not obtained by such Third Party directly or indirectly from the disclosing Party on a confidential basis and without the right to so disclose to such receiving Party; (d) prior to disclosure under this Agreement, was already in the possession of the receiving Party, its Affiliates or their (sub)licensees; provided that such exception will not apply to any Licensed Know-How or Joint Collaboration IP; or (e) have been independently developed by or for the receiving Party without the aid, application, use or reference of or to the disclosing Party’s Confidential Information and outside this Agreement; provided that such exception will not apply to any Joint Collaboration IP. 8.2.2 Notwithstanding the disclosures permitted under this Section 8.2.2 as set forth below, any Confidential Information so disclosed will remain subject to the confidentiality obligations of Section 8.1, unless and until any exceptions described in Section 8.2.1 will apply. Either Party may disclose Confidential Information to the extent such disclosure is made: (a) in response to a valid order of a court of competent jurisdiction or other Governmental Authority or Regulatory Authority or, if in the reasonable opinion of the receiving Party’s legal counsel, such disclosure is otherwise required by Applicable Law, including by reason of filing with securities regulators (including the rules and regulations of any stock exchange or trading market on which the disclosing Party’s (or its parent’s) securities are first listed or thereafter traded (or to which an application for listing has been submitted by such Party or its parent, including any potential merger partner)); provided that the receiving Party will first have given notice to the disclosing Party and given the disclosing Party a reasonable opportunity to quash such order or to obtain a protective order or confidential treatment requiring that the Confidential Information and documents that are the subject of such order or requirement be held in confidence by such court or agency; provided further that the Confidential Information disclosed in response to such court or governmental order or Applicable Law will be limited to that information which is, in the reasonable view of the disclosing Party, legally required to be disclosed in response to such court or governmental order or Applicable Law (including the rules and regulations of any stock exchange or trading market on which the disclosing Party’s (or its parent’s) securities are first listed or traded (or to which an application for listing has been submitted by such Party or its parent, including any potential merger partner)); (b) by either Party, to their Affiliates or Sublicensees (or (sub)licensees in the case of Haisco) solely for such Affiliates or Sublicensees (or (sub)licensees in the case of Haisco) to perform such Party’s obligations or exercise such Party’s rights under this Agreement (it being understood that, subject to Section 8.1.1, Haisco will have the right to disclose the Product-Specific Licensed Know-How |
| 52 for the Exploitation of any Licensed Compound or Licensed Product in the Haisco Territory or Manufacture of any Licensed Compound or Licensed Product in the Territory for the Exploitation thereof in the Haisco Territory or Terminated Territory), provided such Affiliates or Sublicensees (or (sub)licensees in the case of Haisco) are subject to written or similarly enforceable obligations of confidentiality and limitations on use of such Confidential Information substantially similar to those contained herein; (c) upon written notice to the other Party (to the extent reasonably practicable), by either Party (or any of its Affiliates or their Sublicensees (or (sub)licensees in the case of Haisco)), to the extent reasonably necessary to exercise its right to prepare, file, prosecute, maintain, extend, enforce and defend any of the Licensed Patents, Joint Collaboration Patents or Licensee Patents; (d) by either Party (or any of its Affiliates or their Sublicensees (or (sub)licensees in the case of Haisco)), to a Regulatory Authority, as reasonably required or useful in connection with any filing, submission or communication with respect to any Licensed Compound or Licensed Product in the Territory (in the case of Licensee being the receiving Party) or in the Haisco Territory (in the case of Haisco being the receiving Party); (e) by either Party (or any of its Affiliates or their Sublicensees (or (sub)licensees in the case of Haisco)) to any actual or potential Third Party collaborator, contractor, licensee, or partner with respect to the Exploitation of a Licensed Compound or Licensed Product in the Haisco Territory (in the case of Haisco) or the Territory (in the case of Licensee) or otherwise as may be necessary or reasonably useful in connection with the exercise of rights or performance of obligations of such Party hereunder (including in connection with any litigation with respect thereto) (it being understood that, subject to Section 8.1.1, Haisco will have the right to disclose the Product-Specific Licensed Know-How for the Exploitation of any Licensed Compound or Licensed Product in the Haisco Territory or Manufacture of any Licensed Compound or Licensed Product in the Territory for the Exploitation thereof in the Haisco Territory or Terminated Territory); provided that such Third Party recipient is subject to written or similarly enforceable obligations of confidentiality and limitations on use of such Confidential Information substantially similar to those contained herein; (f) by either Party (or any of its Affiliates or their Sublicensees (or (sub)licensees in the case of Haisco)) to any actual or potential acquisition partners, (sub)licensees or Sublicensees, financing sources, lenders, investors or advisors (including attorneys, accountants, consultants, bankers or financial advisors of the foregoing) who require such Confidential Information for the purpose of evaluating or carrying out an actual or potential investment, acquisition, license, collaboration, financing or other business transaction (with respect to disclosure to acquisition partners, financing sources, lenders or investors) or providing advice to the receiving Party or the applicable Affiliate or Sublicensee (or (sub)licensees in the case of Haisco) (with respect to disclosure to advisors); provided that such Third Party recipient is subject to written or similarly enforceable obligations of confidentiality and limitations on use of such Confidential Information substantially similar to those contained herein. 8.3 Publications. On a Program-by-Program basis, during the Term, if either Party intends to publish, publicly present or otherwise publicly disclose any paper, publication, oral presentation, abstract, poster, manuscript or other presentation relating to the Licensed Compounds or Licensed Products (each, a “Publication”), such Party will provide the other Party an opportunity to review such Publication to determine whether such Publication contains the other Party’s Confidential Information or jointly owned Confidential Information. The Party seeking to make a Publication (the “Publication Party”) will deliver to the other Party (the “Non-Publication Party”) a copy of any such proposed Publication or the proposed oral disclosure, together with any slides or other materials to be provided in connection with such oral disclosure (if any), at least 14 days prior to submission for abstract (or at least 30 days prior to submission for any other publication or presentation) for review by the Non-Publication Party. The Non-Publication |
| 53 Party will have the right, at its sole discretion, to: (a) require the removal of its Confidential Information (including, for clarity, jointly owned Confidential Information) from any such Publication, or (b) request a reasonable delay in publication or presentation in order to protect patentable information. If the Non-Publication Party requests such a delay provided in the foregoing clause (b), then the Publication Party will delay submission or presentation for a period of 90 days after its provision of the copy of the proposed Publication or disclosure to enable patent applications protecting the Non-Publication Party’s rights in such information and the Parties will discuss in good faith with respect thereto. Haisco’s failure to take actions described in the foregoing clauses (a) and (b) will be construed as a consent to the relevant disclosure in the proposed Publication, but will not be construed as consent to the disclosure of Haisco’s Confidential Information or the waiver of Licensee’s obligations under any other provisions of this ARTICLE VIII. Licensee’s failure to take actions described in the foregoing clauses (a) and (b) will be construed as a consent to the relevant disclosure in the proposed Publication, but will not be construed as consent to the disclosure of Licensee’s Confidential Information or the waiver of Haisco’s obligations under any other provisions of this ARTICLE VIII. 8.4 Press Releases and Other Communications to Third Parties. On a date to be mutually determined by the Parties, the Parties will issue a press release regarding the signing of this Agreement in substantially the form attached hereto as Schedule 8.4. Other than as required by Applicable Law or the rules of a stock exchange on which the securities of the disclosing Party are first listed or traded (or to which an application for listing has been submitted by such Party or its parent, including any potential merger partner), the Parties will not, without providing fifteen (15) Business Days prior written notice to the other Party (including the proposed final language of any such public announcement), make any public announcement concerning either this Agreement (including the subject matter hereof) or furnish any statement to any Person concerning the existence of this Agreement, its terms and the transactions contemplated hereby, except for (a) press releases made in compliance with this Section 8.4, and (b) disclosures made in compliance with Section 8.1, Section 8.2 and Section 8.5. The Parties agree that after a disclosure made in a manner consistent with this Section 8.4, including the issuance of the initial press release and any subsequent public announcement, each Party may make subsequent public disclosures reiterating any information contained in same without having to obtain the other Party’s consent and may post any such publication or a link to it on its website without the consent of the other Party, so long as any such public disclosures are not inconsistent with prior public disclosures or public announcements approved by the other Party pursuant to this Section 8.4 and which do not reveal any non-public information about or Confidential Information of the other Party. 8.5 Use of Name. Except as expressly provided herein, neither Party will mention or otherwise use the name, logo or trademark of the other Party or any of its Affiliates or any of its or their (sub)licensees (or any abbreviation or adaptation thereof) (including any Product Trademark) in any publication, press release, marketing and promotional material or other form of publicity without the prior written consent of such other Party; provided, however, that each Party will have the right to use the other Party’s name and logo on such Party’s website and marketing and promotional materials for the sole purpose of identifying the other Party as its licensor or licensee, as applicable, without the requirement to obtain such consent. The restrictions imposed by this Section 8.5 will not prohibit (a) either Party from making any disclosure identifying the other Party to the extent required in connection with its exercise of its rights or obligations under this Agreement or (b) either Party from making any disclosure identifying the other Party that is required by Applicable Law or the rules of a stock exchange on which the securities of the disclosing Party (or its parent) are listed (or to which an application for listing has been submitted by such Party or its parent, including any potential merger partner). 8.6 Return or Destruction of Confidential Information. Upon the effective date of the termination of this Agreement (in its entirety or in part) for any reason but subject to ARTICLE XII, with respect to Confidential Information to which such non-requesting Party does not retain rights under the |
| 54 surviving provisions of this Agreement, each Party will, upon and in accordance with the other Party’s request in writing, either (a) promptly destroy all copies of such Confidential Information in the possession or control of the non-requesting Party and confirm such destruction in writing to the requesting Party; or (b) promptly deliver to the requesting Party, at the non-requesting Party’s sole cost and expense, all copies of such Confidential Information in the possession or control of the non-requesting Party. Notwithstanding the foregoing, the non-requesting Party will be permitted to retain such Confidential Information (x) to the extent necessary or reasonably useful for purposes of performing any continuing obligations or exercising any ongoing rights hereunder and (y) any computer records or files containing such Confidential Information that have been created solely by such non-requesting Party’s automatic archiving and back-up procedures, to the extent created and retained in a manner consistent with such non-requesting Party’s standard archiving and back-up procedures, but not for any other uses or purposes. All such Confidential Information will continue to be subject to the terms of this Agreement for the period set forth in Section 8.1 following any termination of this Agreement. ARTICLE IX INTELLECTUAL PROPERTY 9.1 Ownership. 9.1.1 Background IP. As between the Parties, each Party will remain the owner of all intellectual property rights owned by or licensed to such Party as of the Effective Date or which are generated or acquired by such Party on or after the Effective Date other than in the course of performing the activities under this Agreement. 9.1.2 Sole Inventions. As between the Parties, each Party will have sole ownership of the Inventions solely conceived, reduced to practice, discovered, developed or otherwise made by or on behalf of such Party (collectively, “Sole Inventions” and with respect to Licensee, “Licensee Sole Inventions” and with respect to Haisco, “Haisco Sole Inventions”). All Patents claiming any Licensee Sole Inventions will be referred to herein as “Licensee Patents,” and all Patents claiming any Haisco Sole Inventions will be referred to herein as “Haisco Sole Invention Patents”. Each Party will promptly disclose to the other in writing and will cause its Affiliates, and its and their Sublicensees or (sub)licensees, as applicable, to so disclose, its respective Sole Inventions that are within the definition of Licensed Technology or Licensee Collaboration IP, as applicable. 9.1.3 Joint Inventions. Each Party will have a one-half undivided ownership of the full right, title and interest in and to any Inventions conceived, reduced to practice, discovered, developed or otherwise made by or on behalf of the Parties or their respective Affiliates jointly (such Inventions, collectively the “Joint Collaboration IP”). All Patents claiming any Joint Collaboration IP will be referred to herein as “Joint Collaboration Patents”, and all Know-How included in Joint Collaboration IP will be referred to herein as “Joint Collaboration Know-How”. Haisco’s interest in any Joint Collaboration Patents will be considered Licensed Patents, and Haisco’s interest in any Joint Collaboration Know-How will be considered Licensed Know-How; and Licensee’s interest in any Joint Collaboration IP will be considered Licensee Collaboration IP. Subject to the other terms and conditions of this Agreement (including the licenses and other rights granted under this Agreement or any Ancillary Agreement by a Party to the other Party and its Affiliates), each Party will have the right to Exploit, including license, the Joint Collaboration IP, without a duty of accounting or any obligation to seek consent from the other Party to exploit such Joint Collaboration IP. To the extent necessary to effect the foregoing, each Party grants to the other Party a non-exclusive, irrevocable, perpetual, fully-paid, worldwide license, with the right to grant sublicenses through multiple tiers, under the granting Party’s interest in Joint Collaboration IP, for any and all |
| 55 purposes, subject to the other terms and conditions of this Agreement (including, for clarity, the exclusive license granted by a Party to the other Party and its Affiliates in Section 2.1). 9.1.4 Disclosure of Joint Collaboration IP. Each Party will promptly disclose to the other in writing and will cause its Affiliates, and its and their (sub)licensees to so disclose, any Know-How within the Joint Collaboration IP. Each Party will also respond promptly to reasonable requests from the other Party for additional information relating to such Know-How as reasonably necessary to exercise such Party’s rights and perform its obligations, hereunder and under any Ancillary Agreement, with respect thereto. 9.1.5 Inventorship. The determination of inventorship of Inventions and the determination of whether Joint Collaboration IP is invented, reduced to practice, discovered, developed or otherwise made under this Agreement jointly with the other Party, in each case, for the purpose of allocating intellectual property rights therein, will be made in accordance with United States patent laws. 9.2 Patent Prosecution and Maintenance. 9.2.1 Right to Prosecute and Maintain. On a Program-by-Program basis, as between the Parties, Licensee will have the first right, but not the obligation, to Prosecute and Maintain all Licensed Patents for such Program in the Territory that solely claim or Cover the Licensed Compound(s) or the Licensed Product(s) for such Program and do not claim or Cover any compound that is not a Licensed Compound or product that is not a Licensed Product for such Program (collectively, “Product-Specific Licensed Patents”) and Joint Collaboration Patents in the Territory, and all Licensee Patents, worldwide, at Licensee’s own cost and expense. Product-Specific Licensed Patents in existence as of the Execution Date include the Licensed Patents identified as Product-Specific Licensed Patents on Schedule 10.2.5. On a Program-by-Program basis, as between the Parties, Haisco will have the first right, but not the obligation, to Prosecute and Maintain all Licensed Patents filed or issued in the Territory that are not Product-Specific Licensed Patents (“Other Licensed Patents”). On a Program-by-Program basis, as between the Parties, Haisco will have the sole and exclusive right, but not the obligation, to Prosecute and Maintain (a) all Licensed Patents and Joint Collaboration Patents in the Haisco Territory, and (b) all Haisco Sole Invention Patents filed or issued worldwide that are not Licensed Patents, in each case, at Haisco’s own cost and expense. 9.2.2 Review and Comment Rights. On a Program-by-Program basis, Licensee will keep Haisco reasonably informed of the status of the Product-Specific Licensed Patents, and Joint Collaboration Patents in the Territory. Licensee (or its designee) will provide Haisco with drafts of all proposed material filings and correspondence to any patent authorities with respect to the Product-Specific Licensed Patents and Joint Collaboration Patents for Haisco’s review and comment reasonably at least thirty (30) Business Days in advance of the intended submission of such proposed filings and correspondence. Licensee (or its designee) will reasonably take into consideration in good faith Haisco’s comments prior to submitting such proposed filings and correspondence. If Haisco does not provide such comments at least ten (10) Business Days prior to the proposed submission date, then Haisco will be deemed to have no comment to such proposed filings or correspondence. 9.2.3 Additional Haisco Rights. On a Program-by-Program basis, Licensee will notify Haisco of any decision to cease Prosecution and Maintenance of any Product-Specific Licensed Patents or Joint Collaboration Patents in the Territory. Licensee will provide such notice at least ninety (90) days prior to any filing or payment due date, or any other due date that requires |
| 56 action in order to avoid loss of rights, in connection with such Product-Specific Licensed Patents or Joint Collaboration Patents. In such event, Haisco will have the right (but not the obligation), at Haisco’s discretion and expense, to continue the Prosecution and Maintenance of such Product-Specific Licensed Patent or Joint Collaboration Patent in Haisco’s name. Haisco’s Prosecution and Maintenance of such Product-Specific Licensed Patents or Joint Collaboration Patents will not change the Parties’ respective rights and obligations under this Agreement with respect to such Product-Specific Licensed Patents or Joint Collaboration Patents other than those expressly set forth in this Section 9.2.3. 9.2.4 Additional Licensee Rights. On a Program-by-Program basis, Haisco will keep Licensee reasonably informed of the status of the Other Licensed Patents in the Territory and will notify Licensee of any decision to cease Prosecution and Maintenance of any Other Licensed Patents in the Territory. Haisco will provide such notice at least sixty (60) days prior to any filing or payment due date, or any other due date that requires action in order to avoid loss of rights, in connection with such Other Licensed Patents. In such event, Licensee will have the right (but not the obligation), at Licensee’s discretion and expense, to continue the Prosecution and Maintenance of such Other Licensed Patent in Haisco’s name. Licensee’s Prosecution and Maintenance of such Other Licensed Patents will not change the Parties’ respective rights and obligations under this Agreement with respect to such Other Licensed Patents other than those expressly set forth in this Section 9.2.4. 9.2.5 Patent Term Extension and Supplementary Protection Certificate. On a Program-by-Program basis, as between the Parties, Licensee (or any of its Affiliates or their Sublicensees) will have the first right, but not the obligation, to make decisions regarding, and to apply for, patent term extensions in the Territory, including the United States with respect to extensions pursuant to 35 U.S.C. § 156 et. seq. and in other jurisdictions in the Territory pursuant to supplementary protection certificates, and in all jurisdictions in the Territory with respect to any other extensions that are now or become available in the future, wherever applicable, for the Product-Specific Licensed Patents and Joint Collaboration Patents in the Territory, and with respect to the Licensed Products (collectively, the “Extensions”), in each case, including whether or not to do so. Haisco will provide prompt and reasonable assistance with respect thereto, as requested by Licensee and at Licensee’s expense and cost, including by taking such action as patent holder as is required under any Applicable Law to obtain such Extension. If Licensee (or its designee) decides to abandon an Extension in a particular country, Licensee will give Haisco prompt notice thereof (not less than sixty (60) Business Days before any action is required to avoid abandonment or lapse), and Haisco will have the right to continue such Extension at Haisco’s sole expense and cost pursuant to this Section 9.2.5. As between the Parties, Haisco will have the sole right, but not the obligation, with respect to the Extensions for all Licensed Patents and Joint Collaboration Patents in the Haisco Territory. 9.2.6 Regulatory Patent Listing. On a Program-by-Program basis, Licensee (or any of its Affiliates or their Sublicensees) will have the first right, but not the obligation, for all Licensed Products and in all countries in the Territory, to file appropriate information with the applicable Regulatory Authority to obtain the listing of any Product-Specific Licensed Patent or Joint Collaboration Patent in the patent listing source in such country in the Territory, if any Licensee shall keep Haisco reasonably informed of the status of the listing of any Product-Specific Licensed Patent or Joint Collaboration Patent under this Section 9.2.6. Licensee will not seek to list any Other Licensed Patent in any such patent listing source without the prior written consent of Haisco, such consent not to be unreasonably withheld. |
| 57 9.2.7 Common Ownership Under Joint Research Agreements. This Agreement will be understood to be a joint research agreement under 35 U.S.C. § 102(c) entered into for the purposes of Developing, Manufacturing and Commercializing Licensed Compounds or Licensed Products. The Parties acknowledge and agree that this Agreement is a “joint research agreement” as defined in 35 U.S.C. § 100(h). Neither Party will (a) unilaterally invoke the provisions of or (b) be required by this reference to have any Patent take advantage of or become subject to, such §103(c), in each case, without the other Party’s prior written consent. 9.2.8 Cooperation. Each Party will, and will cause its Affiliates, licensors (to the extent permissible under the terms of applicable license), Sublicensees (or, in the case of Haisco, the applicable (sub)licensees), and its or their inventors to, reasonably cooperate with the other Party or anyone acting on such Party’s behalf with regard to the Prosecution and Maintenance of any Patent described in Section 9.2.1 in order to reasonably implement the foregoing provisions of this Section 9.2, at the other Party’s expense and cost. Such cooperation may include such Party’s execution of necessary legal documents, coordinating filing or prosecution of applications to avoid potential issues during prosecution (including novelty, non-obviousness, enablement, estoppel and double patenting), and the assistance of such Party’s relevant personnel and the transfer of the applicable patent files to the other Party. 9.3 Enforcement of Licensed Technology and Joint Collaboration IP. 9.3.1 Notification of Infringement. In the event that either Party becomes aware of an alleged existing or threatened infringement or misappropriation of any Licensed Technology or Joint Collaboration IP in the Territory (“Infringement”), it will promptly notify the other Party and provide the other Party with all details of such infringement of which it is aware. For the purpose of this Section 9.3, “Competitive Infringement” means any such alleged existing or threatened (a) infringement of any Licensed Patents or Joint Collaboration Patents, or (b) misappropriation of (i) any Licensed Know-How solely related and specific to any Licensed Compound or Licensed Product or (ii) any Joint Collaboration Know-How, in each case ((a) and (b)), on account of a Third Party’s Exploitation of any Licensed Compound or Licensed Product in the Territory. 9.3.2 Enforcement. On a Program-by-Program basis, as between the Parties, Licensee will have the first right, but not the obligation, to bring, control and settle any Patent or Know-How enforcement action (“Enforcement Action”) against any alleged or confirmed Competitive Infringement in the Territory at its own expense as it reasonably determines appropriate, using counsel of its choice. If Licensee does not commence an Enforcement Action to abate any such Competitive Infringement, within sixty (60) days of either Party providing a notice of existing or threatened Competitive Infringement under Section 9.3.1, then Haisco will have the right to commence any such Enforcement Action at its own expense using counsel of its choice. As between the Parties, Haisco will have the sole right, but not the obligation, to bring, control and settle any Enforcement Action against any alleged or confirmed Infringement in the Haisco Territory at its own expense. 9.3.3 Enforcement of Other Licensed Patents. On a Program-by-Program basis, notwithstanding anything to the contrary in this Agreement, in any Enforcement Action that Licensee undertakes, Licensee will use Commercially Reasonable Efforts to assert Product-Specific Licensed Patents against the relevant Competitive Infringement, without asserting any Other Licensed Patents; provided that, in the event that, with respect to a country in the Territory, it is necessary for Licensee to assert any Other Licensed Patents to effectively pursue, or prevail in, an Enforcement Action against any alleged or confirmed Competitive Infringement as determined by |
| 58 Licensee reasonably and in good faith (after consultation with Haisco) with the supporting advice of reputable patent counsel engaged by Licensee which will be reasonably acceptable to Haisco, then with respect to the Territory, Licensee may bring or control any Enforcement Action asserting any Other Licensed Patents against any alleged or confirmed Competitive Infringement only with the prior written consent of Haisco (not to be unreasonably withheld, conditioned, or delayed, except that Haisco may withhold consent where such assertion would reasonably be expected to materially adversely affect Haisco’s or any its Affiliates’ or licensees’ rights to Exploit a compound or product of Haisco or any of its Affiliate or licensees claimed by or under such Other Licensed Patents), and in coordination with Haisco. Haisco will have the right to participate in such Enforcement Action, at its own expense, through counsel of its choice, and to review and comment on all substantive filings and submissions in advance. For clarity, Section 9.6 will apply to such Enforcement Action. 9.3.4 Assistance. At the request of the other Party (or any of its Affiliates or their Sublicensees (or (sub)licensees in the case of Haisco)), each Party will provide reasonable assistance in connection with any enforcement action brought by the other Party (or any of its Affiliates or their Sublicensees (or (sub)licensees in the case of Haisco)) hereunder, including by executing reasonably appropriate documents, cooperating in discovery and joining as a party to the action if required, and the other Party (or any of its Affiliates or their Sublicensees (or (sub)licensees in the case of Haisco)) will reimburse such Party for its reasonable out-of-pocket costs incurred in providing any such assistance. 9.3.5 Costs and Recoveries. With respect to an Enforcement Action brought by a Party (or any of its Affiliates or their (sub)licensees) under Section 9.3.2, any recovery realized as a result of such enforcement action (whether by way of settlement or otherwise) will be applied in the following priority: (a) to reimburse the Parties for their costs and expenses in making such recovery (which amounts will be allocated pro rata if insufficient to cover the totality of such expenses) and (b) retained by the Party bringing such Enforcement Action (or any of its Affiliates or their (sub)licensees); provided that, if Licensee (or any of its Affiliates or their Sublicensees) is the Party bringing such Enforcement Action, such remainder retained by it will be deemed Net Sales under this Agreement. 9.3.6 Other Infringements. As between the Parties, Haisco will have the sole right, but not the obligation, to bring and control, at its own cost and expense, any Enforcement Action in connection with any Infringement in the Territory that is not a Competitive Infringement and Section 9.3.3 and 9.3.5 will apply, mutatis mutandis, to such Enforcement Action. 9.4 Third Party Actions. 9.4.1 Notification of Third Party Action. Each Party will immediately disclose to the other Party in writing any warning letter or other notice of infringement or misappropriation received by a Party, or any action, suit or proceeding brought against a Party alleging infringement of a Patent or misappropriation of intellectual property of any Third Party with regard to any aspect of the past, current or future Exploitation of any Licensed Compounds or Licensed Products by either Party, any of its Affiliates or (sub)licensees pursuant to this Agreement, including any defense or counterclaim in connection with an infringement action initiated pursuant to this Section 9.4 (each, a “Third Party Action”). 9.4.2 Licensee Right to Defend in the Territory. On a Program-by-Program basis, as between the Parties, Licensee (or any of its Affiliates or their Sublicensees), through counsel of its choosing, will have the first right, but not the obligation, to assume direction and control of the defense against any Third Party Action (including direction and control of related |
| 59 litigation, settlement, appeal or other disposition of Third Party Actions) in the Territory alleging that the Exploitation of any Licensed Compound of Licensed Product by Licensee or its Affiliates or Sublicense infringes or misappropriates a Third Party’s intellectual property rights at its sole cost and expense. If Licensee elects not to defend against such Third Party Action within sixty (60) days of either Party providing a notice of such Third Party Action under Section 9.4.1, Haisco will have the right, but not the obligation, to defend against such action. Any recoveries awarded to the defending Party (or any of its Affiliates or their Sublicensees (or (sub)licensees in the case of Haisco)) in connection with any Third Party Action defended under this Section 9.4.2 will be applied to reimburse the Parties for their costs and expenses incurred in defending such Third Party Action (which amounts will be allocated pro rata if insufficient to cover the totality of such expenses), with the balance of any such recoveries being retained or provided to the defending Party (or any of its Affiliates or their Sublicensees (or (sub)licensees in the case of Haisco)). The defending Party (or any of its Affiliates or their Sublicensees (or (sub)licensees in the case of Haisco)) will have the sole and exclusive right to select counsel for such Third Party Action. 9.4.3 Consultation and Cooperation. The Parties may consult with one another on all material aspects of the defense of Third Party Actions. The defending Party will keep the other Party reasonably informed of the status and progress of such efforts and will reasonably consider the other Party’s comments on any such efforts. The Parties will reasonably cooperate with each other in all such actions or proceedings at the defending Party’s cost and expense, and the non-defending Party agrees that it will furnish to the defending Party (or any of its Affiliates or their Sublicensees (or (sub)licensees in the case of Haisco)), upon reasonable request of the defending Party (or any of its Affiliates or their Sublicensees (or (sub)licensees in the case of Haisco)), all evidence and information in its Control relating to, or reasonably necessary for, the defense of such actions or proceedings. The non-defending Party also agrees, upon reasonable request of the defending Party (or any of its Affiliates or their Sublicensees (or (sub)licensees in the case of Haisco)) and to the extent necessary to defense a Third Party Action, to join as a party to any proceedings initiated in relation to such Third Party Action in relation to the Exploitation of Licensed Products in the Territory at the defending Party’s cost and expense. In any event, the non-defending Party will have the right, at its own expense, to be represented in any such action by counsel of its own choice, and the defending Party and its counsel will reasonably cooperate with non-defending Party and its counsel in strategizing, preparing and prosecuting any such action or proceeding. 9.5 Invalidity or Unenforceability Defenses or Actions. Each Party will promptly notify the other Party in writing of any alleged or threatened assertion of invalidity or unenforceability of any of the Licensed Patents or Joint Collaboration Patents in the Territory by a Third Party of which such Party becomes aware, including, for example, pre-grant and post-grant oppositions, limitation, review, re-examination, nullity or revocation actions, post-grant reviews and other patent office proceedings involving the referenced Patents. Where such allegation or threat is made in an opposition, reexamination, interference or other patent office proceeding or a declaratory judgement action, then the provisions of Section 9.2 will apply; provided however that if a Party wishes to bring an Infringement claim to enforce any Licensed Patent or Joint Collaboration Patent in the Territory, then the provisions of Section 9.3 will apply. Where such allegation or threat is made in a counterclaim to an enforcement action brought under Section 9.3, then the provisions of Section 9.3 will apply. The Parties will reasonably cooperate with each other in all such actions or proceedings, and the defending Party will keep the other Party reasonably informed of the status and progress of such efforts and will reasonably consider the other Party’s comments on any such efforts. The non-defending Party agrees that it will furnish to the defending Party (or any of its Affiliates or their Sublicensees (or (sub)licensees in the case of Haisco)), upon reasonable request of the defending Party (or any of its Affiliates or their Sublicensees (or (sub)licensees in the case of Haisco)), all evidence and information in its possession relating to, or reasonably necessary for, the defense of such actions or proceedings. |
| 60 9.6 Settlement. Each Party will not enter into any settlement or consent judgment or other voluntary final disposition in any infringement or misappropriation action under Section 9.3, 9.4 or 9.5 in a manner that would materially adversely affect or be reasonably expected to materially adversely affect the rights or interests of the other Party, without the prior written consent of such other Party (not to be unreasonably withheld). 9.7 Third Party Rights. On a Program-by-Program basis, if, in the opinion of Licensee, the Exploitation of a Licensed Product hereunder infringes or is reasonably expected to infringe or misappropriate any Patent, Know-How or other intellectual property right of a Third Party in any country or jurisdiction in the Territory, or such intellectual property right is necessary for the Exploitation of a Licensed Product, including being required for Regulatory Approval of a Licensed Product, then Licensee (or any of its Affiliates or their Sublicensees) will have the first right, but not the obligation, to negotiate and obtain a license or other rights from such Third Party to such rights (a “Third Party License”) if such rights cover only countries or jurisdictions in the Territory as necessary or desirable to Exploit such Licensed Product in such country or jurisdiction. The immediately preceding sentence will apply, mutatis mutandis, to Haisco with respect to the Haisco Territory (with all references to Licensee and Territory replaced by Haisco and Haisco Territory, respectively). Notwithstanding the foregoing, each Party will have the right to obtain a Third Party License covering countries both inside and outside its own territory so long as (a) such Third Party License does not impose any liability, restriction or obligation on the other Party without the other Party’s consent (except for the royalty reduction set forth in and pursuant to Section 7.6.1) and (b) if the underlying intellectual property rights of any Third Party License are also necessary or reasonably useful for the Exploitation of any Licensed Product in the other Party’s territory, such Party has the right under such Third Party License to sublicense (in multiple tiers) such intellectual property rights to such other Party for such Exploitation in such other Party’s territory; provided that (i) in the case of Licensee, if the underlying intellectual property rights of any Third Party License are also necessary or reasonably useful for the Exploitation of any Licensed Product in the Haisco Territory, or Licensee intends to obtain a Third Party License covering any country or jurisdiction in the Haisco Territory, or (ii) in the case of Haisco, if the underlying intellectual property rights of any Third Party License are also necessary or reasonably useful for the Exploitation of any Licensed Product in the Territory, or Haisco intends to obtain a Third Party License covering any country or jurisdiction in the Territory, then, in each case ((i) and (ii) above), prior to initiating discussions with any such Third Party with respect to obtaining such Third Party License, Licensee (in the case of clause (i) above) or Haisco (in the case of clause (ii) above) will promptly notify the other Party, and the Parties will promptly discuss in good faith and coordinate on obtaining such Third Party License from such Third Party In addition, if any Patent, Know-How or other intellectual property right of a Third Party in any country or jurisdiction in the Territory is reasonably useful for the Exploitation of any Licensed Product in the Territory and the Parties mutually agree a license or other rights from such Third Party therefor should be subject to the royalty reduction set forth in Section 7.6.1, Licensee will have the sole and exclusive right, but not the obligation, to negotiate and obtain a license or other rights from such Third Party to such rights (such mutually-agreed license, a “Third Party Optional License”) solely with respect to the Territory as necessary or desirable to Exploit such Licensed Product. With respect to any Third Party Optional License covering countries both inside and outside the Territory, the Parties will promptly discuss in good faith and coordinate on obtaining such Third Party Optional License from such Third Party, including, if the underlying intellectual property rights of any Third Party Optional License are also necessary or reasonably useful for the Exploitation of any Licensed Product in the other Party’s territory, if so requested by such other Party, such Party will obtain the right under such Third Party Optional License to sublicense such intellectual property rights to such other Party for such Exploitation in such other Party’s territory. In the event that Licensee (or any of its Affiliates or their Sublicensees) negotiates and obtains any Third Party License or Third Party Optional License from a Third Party, Licensee will be entitled to deduct royalties payable to such Third Party from the royalties payable to Haisco hereunder pursuant to and to the extent permitted by Section 7.6.1. |
| 61 9.8 Trademarks. On a Program-by-Program basis, Licensee (or any of its Affiliates or their Sublicensees) will have the sole and exclusive right but not obligation to select the Trademarks used in connection with the sale or marketing of the Licensed Products in the Territory (any such Trademarks, the “Product Trademarks”), and to register, maintain and defend all Product Trademarks, at Licensee’s (or any of its Affiliates’ or their Sublicensees) own cost and expense. Licensee will own such Product Trademarks. Haisco will not, and will not permit any of its Affiliates to, (a) use in their respective businesses, any trademark that is confusingly similar to, misleading or deceptive with respect to or that dilutes any (or any part of any) Product Trademark and (b) do any act that endangers, destroys, or similarly affects, in any material respect, the value of the goodwill pertaining to any Product Trademark. Haisco will not, and will not permit any of its Affiliates to, attack, dispute or contest the validity of or ownership of any Product Trademark anywhere in the Territory or any registrations issued or issuing with respect thereto. This Section 9.8 will apply, mutatis mutandis, to Haisco and the Trademarks used in connection with the sale or marketing of the Licensed Products in the Haisco Territory (with all references to Licensee, Haisco and Territory replaced by Haisco, Licensee and Haisco Territory, respectively). 9.9 Common Interest. All non-public or proprietary information exchanged between the Parties regarding any prosecution, maintenance, enforcement and defense actions under this ARTICLE IX will be deemed to be Confidential Information of each Party or its Affiliates that Controls the applicable intellectual property rights. In addition, each Party acknowledges and agrees that, with regard to such prosecution, maintenance, enforcement and defense, the interests of the Parties as collaborators, licensors or licensees are to, for their mutual benefit, obtain patent protection and plan defense against potential patentability/invalidity challenges, infringement or misappropriation activities by Third Parties, and as such, are aligned and are legal in nature. Each Party agrees and acknowledges that it has not waived, and nothing in this Agreement constitutes a waiver of, any legal privilege concerning intellectual property rights under this ARTICLE IX, including privilege under the common interest doctrine and similar or related doctrines. Notwithstanding anything to the contrary in this Agreement, to the extent a Party has a good faith belief that any non-public or proprietary information required to be disclosed by such Party to the other Party under this ARTICLE IX is protected by attorney-client privilege or any other applicable legal privilege or immunity, such Party will not be required to disclose such information unless and until the Parties have agreed upon a procedure (which may include entering into a specific common interest agreement, disclosing such information on a “for counsel eyes only” basis or similar procedure) under which such information may be disclosed without waiving or breaching such privilege or immunity. The Parties will in good faith cooperate to agree upon any such procedures. ARTICLE X REPRESENTATIONS AND WARRANTIES; COVENANTS 10.1 Mutual Representations, Warranties and Covenants. Each Party hereby represents and warrants, as of the Execution Date and as of the Effective Date, and covenants with respect to the last sentence in Section 10.1.3, Section 10.1.4, the last two sentences in Section 10.1.5, and Section 10.1.6, to the other Party as follows: 10.1.1 Corporate Existence and Power. It is a company or corporation duly organized, validly existing, and in good standing under the laws of the jurisdiction in which it is incorporated, and has full corporate power and authority and the legal right to own and operate its property and assets and to carry on its business as it is now being conducted and as contemplated in this Agreement, including the right to grant the licenses granted by it hereunder. 10.1.2 Authority and Binding Agreement. As of the Execution Date, (a) it has the corporate power and authority and the legal right to enter into this Agreement and perform its obligations hereunder; (b) it has taken all necessary corporate action on its part required to authorize |
| 62 the execution and delivery of this Agreement and the performance of its obligations hereunder; (c) this Agreement has been duly executed and delivered on behalf of such Party, and constitutes a legal, valid and binding obligation of such Party that is enforceable against it in accordance with its terms; and (d) its execution of and performance under this Agreement will not violate or breach any obligation or restriction (including any confidentiality or non-competition obligation or any exclusivity restriction) to which such Party is legally bound by contract, judicial order or otherwise. 10.1.3 No Conflict. It is not a party to any agreement that would prevent it from granting the rights granted to the other Party under this Agreement or performing its obligations under this Agreement. It has the full right to grant the licenses or sublicenses (as applicable) granted herein. Beginning on the Execution Date and continuing during the Term, it will not enter into any agreement, contract, commitment or other arrangement that conflicts with the rights granted to the other Party hereunder or otherwise prevent the other Party from exercising the rights granted to it hereunder. 10.1.4 Compliance with Law. Each Party will comply with all Applicable Law in connection with the execution of, and its performance under, this Agreement. Without limiting the generality of the foregoing, with Licensee’s prior written consent (such consent not to be unreasonably withheld or delayed), Haisco will register a “short-form” version (subject to Licensee’s prior written approval) of this Agreement with applicable Governmental Authorities in Mainland China as may be required by Applicable Law, provided that the “short-form” version will include only information required by Applicable Law to be disclosed to the applicable Governmental Authority for purposes of the required registration. The Parties agree that, notwithstanding the signing of such short-form agreement, this Agreement shall remain in full force and effect and that in the event there is any inconsistencies between this Agreement and the short-form agreement, this Agreement shall control. 10.1.5 No Debarment. (a) Neither it nor any of its Affiliates has been debarred or is subject to debarment pursuant to Section 306 of the FFDCA or analogous provisions of Applicable Law outside the United States or listed on any excluded list, and (b) neither it nor any of its Affiliates has, to its knowledge, used in any capacity, in connection with the activities to be performed under this Agreement, any individual or entity that has been debarred pursuant to Section 306 of the FFDCA or analogous provisions of Applicable Law outside the United States, or that is the subject of a conviction described in such Section or analogous provisions of Applicable Law outside the United States, or listed on any excluded list. Each Party will, and will cause its Affiliates not to, use in any capacity, in connection with the performance of the activities hereunder, any Person that has been debarred pursuant to Section 306 of the FFDCA (or analogous provisions of Applicable Law outside the United States) or that is the subject of a conviction described in such section. Each Party will inform the other Party in writing promptly if it (or it becomes aware that any such Person that is performing any activities hereunder) is debarred or is the subject of a conviction described in Section 306 of the FFDCA (or analogous provisions of Applicable Law outside the United States) or if (to such Party’s knowledge with respect to such Person performing any material activities hereunder) any action, suit, claim, investigation or legal or administrative proceeding is pending or, to the first Party’s knowledge, is threatened, related to the debarment or conviction of it or any such Person performing any activities hereunder. 10.1.6 Limitations on Funding. Each Party will not, and will cause its Affiliates not to, use any Third Party (including Governmental Authority) funding with respect to the performance of any activities hereunder that reasonably could diminish the other Party’s rights hereunder without the prior written consent of the other Party in each case. |
| 63 10.2 Additional Representations, Warranties and Covenants of Haisco. Except as set forth in Schedule 10.2, Haisco represents and warrants to Licensee as of the Execution Date and as of the Effective Date, and covenants with respect to the third sentence in Section 10.2.5, as specified below: 10.2.1 Non-Infringement of Licensed Technology by Third Parties. To Haisco’s knowledge, there are no activities by Third Parties that would constitute misappropriation or infringement of any of the Licensed Technology within the Territory. 10.2.2 Ownership. Haisco and its Affiliates Control the Licensed Technology free and clear of all liens and encumbrances, except for Licensed Technology non-exclusively licensed from, or non-exclusively licensed to, contract research organizations, academic or not-for profit collaborators or principal investigators, or other contractors or subcontractors (such Persons, collectively, the “Relevant Third Parties”) under agreements entered into in the ordinary course of business with such Relevant Third Parties, and where such licenses or the grant of such licenses, as applicable, are incidental to the performance of services or research and development activities under such agreements, customary in the industry for arrangements with such Relevant Third Parties, and do not and would not reasonably be expected to materially encumber or limit Licensee’s practice of the Licensed Technology to Exploit the Licensed Compounds or Licensed Products under this Agreement. Haisco has the right to grant all rights and licenses it purports to grant to Licensee and its Affiliates under this Agreement and neither such rights and licenses nor any other provision of this Agreement are subject to any in-license or other similar agreements with another Third Party regarding any intellectual property rights licensed hereunder, other than Licensed Technology non-exclusively in-licensed from the Relevant Third Parties. To Haisco’s knowledge, Haisco has not misappropriated any intellectual property of a Third Party in connection with Exploiting any of the Licensed Compounds or Licensed Products or conceiving, inventing or otherwise developing any of the Licensed Technology or Haisco Regulatory Documentation. 10.2.3 Validity and Enforceability. Haisco has complied in all material respects with all Applicable Law with respect to the filing, prosecution and maintenance of the Licensed Patents. Haisco has paid all maintenance and annuity fees with respect to the Licensed Patents due. To Haisco’s knowledge, no dispute regarding inventorship has been alleged or threatened with respect to any Licensed Patents. 10.2.4 No Action or Claim. There are no actual, pending or, to Haisco’s knowledge, alleged or threatened, adverse actions, suits, claims, interferences, re-examinations, oppositions, inventorship challenges or formal governmental investigations involving any of the Licensed Technology, in each case that are in or before any Governmental Authority, which if adversely determined would have a material effect upon the ability of Haisco to use or provide any of the Licensed Compounds or Licensed Products, Haisco Regulatory Documentation or the Licensed Technology in connection with the activities to be conducted hereunder, or to fulfil its obligations pursuant to the terms of this Agreement. 10.2.5 Licensed Patents. Schedule 10.2.5 includes a complete and correct list, in all respects, of all Patents Controlled by Haisco or any of its Affiliates as of the Execution Date that are necessary or reasonably useful for the Exploitation of any Licensed Compound or Licensed Product in the Territory (except any Licensed Patents non-exclusively licensed from the Relevant Third Parties), and all such listed Patents are “Licensed Patents” hereunder. As of the Execution Date, all Licensed Patents that are identified as “Product-Specific Licensed Patents” in Schedule 10.2.5 are Product-Specific Licensed Patents. During the Term, if Haisco reasonably believes that any Patent that comes into the Control of Haisco after the Execution Date falls within the scope of Licensed Patents (except any Licensed Patents non-exclusively licensed from the Relevant Third |
| 64 Parties), Haisco will as soon as reasonably practicable notify Licensee of such change in the Licensed Patents and provide an updated Schedule 10.2.5 reflecting such change. No rights or licenses from Haisco or any of its Affiliates are required under the Licensed Technology or Haisco Regulatory Documentation for Licensee (and its Affiliates and Sublicensees) to Exploit any Licensed Compounds or Licensed Products in the Territory as contemplated herein other than those rights and licenses granted under this Agreement. As of the Execution Date, neither Haisco nor any of its Affiliates has previously entered into any agreement, whether written or oral, with respect to or otherwise assigned, transferred, licensed, conveyed or otherwise encumbered its right, title or interest in or to (a) any of the Licensed Technology or Haisco Regulatory Documentation (including by granting any covenant not to sue with respect thereto) or (b) any Patent or other intellectual property or proprietary right that would be Licensed Technology or Haisco Regulatory Documentation, but for such assignment, transfer, license, conveyance or encumbrance, in each case of clauses (a) and (b), that is inconsistent with the rights and licenses granted to Licensee under this Agreement. To Haisco’s knowledge, as of the Execution Date, neither the use of any Licensed Know-How supplied by Haisco hereunder for Development (in or outside the Territory), Manufacture (in or outside the Territory pursuant to the Manufacturing processes provided by Haisco to Licensee hereunder) nor Commercialization (in the Territory) of Licensed Compound or Licensed Product pursuant to this Agreement would infringe any intellectual property rights of any Third Party. 10.2.6 Third Party Agreements. There are no exclusivity provisions or any other restrictions in any agreement between Haisco or any of its Affiliates, on the one hand, and any Third Party that would adversely limit Licensee’s (or any of its Affiliates’ and their Sublicensees’) ability to Exploit the Licensed Compounds or Licensed Products pursuant to this Agreement. Neither Haisco nor any of its Affiliates are delinquent in any payment obligations to any Third Party, or engaged in any dispute with any Third Party, that would limit Licensee’s (or any of its Affiliates’ and their Sublicensees’) ability to Exploit the Licensed Compounds or Licensed Products pursuant to this Agreement. 10.2.7 Compliance with Applicable Law. The Development and practice of the Licensed Technology owned by Haisco that has been conducted by Haisco or any of its Affiliates and its and their subcontractors, has been conducted in compliance with all Applicable Law in all material respects. Neither Haisco nor any of its Affiliates, nor any of their respective officers, employees or agents, has made an untrue statement of a material fact or fraudulent statement to any Regulatory Authority or failed to disclose a material fact required to be disclosed to any Regulatory Authority, in each case, related to the Licensed Compounds or Licensed Products. The pending applications included in Licensed Patents are being diligently prosecuted in the respective patent offices in the Territory in accordance with Applicable Law and Haisco and any of its Affiliates have timely presented all relevant references, documents and information of which it and the inventors are aware to the relevant patent examiner at the relevant patent office. 10.2.8 Licensed Technology. (a) Haisco is not a party to any agreement that would prevent it from granting the rights granted to Licensee under this Agreement or performing its obligations under this Agreement, (b) Haisco has the full right to grant to Licensee the licenses and other rights set forth in this Agreement, and, to Haisco’s knowledge, such grant will not result in the misappropriation of any Third Party intellectual property or violation of any Third Party’s rights with respect thereto and (c) Haisco has not granted to any Third Party any right or license, including any covenant not to sue, to Exploit any of the Licensed Technology, except for non-exclusive licenses and rights granted to the Relevant Third Parties. |
| 65 10.2.9 Government Funding. The inventions claimed or covered by the Licensed Technology (a) were not conceived, invented or otherwise developed in connection with any research activities funded, in whole or in part, by the federal government of the United States or any agency thereof, or any other Governmental Authority; other than research activities funded by the government of the People’s Republic of China or its agencies where the terms of the applicable funding do not impose any lien, encumbrance, restriction, grant of rights, or any requirement for action or inaction that would conflict with, limit, or otherwise restrict the rights and licenses granted to Licensee under this Agreement or require the disclosure of any intellectual property, data, or other information to the government of the People’s Republic of China or its agencies, (b) are not a “subject invention” as that term is described in 35 U.S.C. Section 201(e) and (c) are not otherwise subject to the provisions of the Patent and Trademark Law Amendments Act of 1980, as amended, codified at 35 U.S.C. §§ 200-212, as amended, as well as any regulations promulgated pursuant thereto, including in 37 C.F.R. part 401. 10.2.10 Technology Transfer Plan. Schedule 4.1 and Schedule 4.2, collectively, include a complete and correct list, in all material respects, of all Know-How (including data, information and Regulatory Documentation) Controlled by Haisco or any of its Affiliates that is necessary or reasonably useful for the Development of any of the Licensed Compounds or Licensed Products in the Territory, except for Licensed Know-How that, if not provided during the Initial Knowledge Transfer, would not reasonably be expected to materially adversely affect Licensee’s Development of the Licensed Compounds or Licensed Products in the Territory. Notwithstanding the foregoing, if any Know-How that is necessary or reasonably useful for the Development of any of the Licensed Compounds or Licensed Products in the Territory, as of the Execution Date, is not Controlled by Haisco, but, as of the Effective Date, has become Controlled by Haisco, Haisco shall not be deemed in breach of this Section 10.2.10 and Haisco will transfer to Licensee such additional Licensed Know-How in accordance with Section 4.3. 10.2.11 Licensed Compounds. Neither Haisco nor any of its Affiliates (a) own or otherwise Control any Small Molecule that binds to or functionally inhibits BRaf kinase or Factor B as a primary mechanism of action, other than the Licensed Compounds, and (b) is a party to an Third Party agreement with respect to the Exploitation of any Small Molecules that binds to or functionally inhibits BRaf kinase or Factor B as a primary mechanism of action. 10.3 Bringdown of Representations and Warranties; Updated Disclosure Schedule. Within two (2) Business Days of the Effective Date, Haisco shall provide to Licensee an updated Schedule 10.2 (the “Updated Disclosure Schedule”) setting forth any updates to the disclosures required to be made under Section 10.2, but solely with respect to matters arising after the Execution Date and prior to the Effective Date (the “Interim Period”). Any such updates in the Updated Disclosure Schedule shall be deemed to qualify the representations and warranties made by Haisco in Section 10.2 as of the Effective Date, but shall not cure any breach of such representations and warranties as of the Execution Date, nor shall any such updates cure any breach of any covenant or obligation of Haisco under this Agreement. If any disclosure in the Updated Disclosure Schedule has a material and adverse impact on the Development, Manufacture, or Commercialization of any Licensed Compound or Licensed Product in the Territory, Licensee shall have the right to terminate this Agreement upon written notice to Haisco within fifteen (15) Business Days after receipt of the Updated Disclosure Schedule, and this Agreement shall terminate and be of no further force or effect as of the date of such notice, except as otherwise expressly provided herein. 10.4 Data Exchange and Use. 10.4.1 Haisco hereby represents and warrants to Licensee that (a) as of the Execution Date, with respect to Licensed Know-How existing as of the Execution Date, and (b) |
| 66 throughout the Term with respect to a Program, with respect to all Licensed Know-How pertaining to such Program, in each case (a) and (b) above, that is clinical data or Personal Data (if any) and required to be transferred to Licensee under this Agreement and permitted to be transferred by Applicable Laws, Haisco agrees, after the Effective Date, to use Commercially Reasonable Efforts to obtain and make in accordance with this Agreement all consents, approvals, and filings, in compliance with Applicable Law to transfer such Licensed Know-How to Licensee with Licensee’s reasonable cooperation, and grant the licenses and rights to such Licensed Know-How granted to Licensee under this Agreement. 10.4.2 During the Term, if any consent, approval or filing is required by Applicable Law in order for a Party to transfer to the other Party any Know-How (including clinical data and Personal Data (if any)) or other materials that such Party is required to transfer to the other Party under this Agreement (including ARTICLE IV and Section 5.4), grant the licenses and rights to such Know-How granted under this Agreement, and for the other Party to use such Know-How for the purposes contemplated under this Agreement, such Party (a) will use Commercially Reasonable Efforts to obtain or make such consent, approval or filing, at its sole cost and expense, as soon as reasonably practicable in order not to unduly delay the transfer of such Know-How or other materials, and (b) will keep the other Party reasonably updated with respect to its efforts to obtain or make such consent, approval or filing, including providing relevant reports to the JSC of such efforts, copies of all relevant correspondence with Governmental Authorities related to such efforts, and copies of all consents, approvals and filings once obtained by such Party. Each Party will provide all reasonably necessary assistance to the other Party to enable such transfer. 10.4.3 Notwithstanding anything to the contrary in this Agreement, to the extent prohibited by Applicable Law, neither Party will transfer, or will be required to transfer, to the other Party any Know-How (including clinical data or Personal Data) or other materials before obtaining or making such consent, approval of filing or obtaining a certificate or other clearance. Promptly after the Execution Date, the Parties will discuss and use Commercially Reasonable Efforts to comply with the requirements of Applicable Law for the transfer or other exchange of Personal Data as required under this Agreement, and Haisco and Licensee will take all further actions necessary to comply with Applicable Law with respect to such transfer or other exchange; provided that neither Party will be obligated to transfer or otherwise exchange any Personal Data to or with the other Party, unless reasonably required for such other Party to Exploit the Licensed Products in the Haisco Territory (in the case of Haisco) or the Territory (in the case of Licensee) and such transfer or sharing is permitted by, and in accordance with, the Applicable Laws, including applicable Data Privacy Laws. 10.4.4 To the extent that Haisco or any of its Affiliates will access any Know-How (including clinical data and Personal Data) that is subject to the Final Rule Implementing Executive Order 14117 of February 28, 2024 (Preventing Access to Americans’ Bulk Sensitive Personal Data and United States Government-Related Data by Countries of Concern) (“U.S. Bulk Data Final Rule”), 90 Fed. Reg. 1636, 28 C.F.R. Part 202, Haisco covenants to Licensee that such access (a) involves “regulatory approval data” as defined under the U.S. Bulk Data Final Rule (to the extent that Licensee transfers, makes accessible or otherwise makes available such data consistent with the U.S. Bulk Data Final Rule regarding “regulatory approval data”) and is necessary for Haisco or its Affiliates to obtain or maintain regulatory authorization or approval or to research or market a drug, biological product, device or a combination product; (b) is ordinarily incident to and part of clinical investigations regulated by the FDA under section 505(i) or 520(g) of the Federal Food, Drug, and Cosmetic Act or clinical investigations that support applications to the FDA for research or marketing permits for drugs, biological products, devices, combination products, or infant formula; or (c) is ordinarily incident to and part of the collection or processing of clinical care |
| 67 data indicating real-world performance or safety of products or the collection or processing of post-marketing surveillance data, and necessary to support or maintain authorization by the FDA. 10.4.5 Additional Covenants. 10.4.6 Haisco will not, and will cause its Affiliates not to, grant any lien on any of the Licensed Compounds, Licensed Products, Licensed Technology or Haisco Regulatory Documentation to any Third Party or knowingly permit any lien to be imposed on any of the Licensed Technology in a manner that would adversely affect Licensee’s rights under this Agreement. Haisco will not, and will cause its Affiliates and subcontractors not to, misappropriate any intellectual property of a Third Party in connection with the performance of Haisco’s obligations under this Agreement. Licensee will not, and will cause its Affiliates, Sublicensees and subcontractors not to, misappropriate any intellectual property of a Third Party in connection with the performance of Licensee’s obligations under this Agreement. 10.4.7 To the extent consistent with Haisco’s rights under the Bankruptcy Code or applicable bankruptcy or insolvency laws in another jurisdiction, Haisco will not, and will cause its Affiliates not to, take any action or fail to take any required action with respect to the Licensed Compounds, Licensed Products, Licensed Technology or Haisco Regulatory Documentation that, as a result of such action or inaction, would limit, diminish or otherwise jeopardize Licensee’s ability to exercise the rights and licenses granted to Licensee under this Agreement following a Haisco Insolvency Event or following a material breach of this Agreement by Haisco. To the extent consistent with Licensee’s rights under the Bankruptcy Code or applicable bankruptcy or insolvency laws in another jurisdiction, Licensee will not, and will cause its Affiliates not to, take any action or fail to take any required action with respect to the Licensed Compounds, Licensed Products or Licensee Collaboration IP that that would limit, diminish or otherwise jeopardize Haisco’s ability to exercise the rights and licenses granted to Haisco under this Agreement following a Licensee Insolvency Event or following a material breach of this Agreement by Licensee. 10.4.8 Haisco will not, and will cause its Affiliates not to, enter into any agreement with respect to, or otherwise assign, transfer, license, convey or otherwise encumber its right, title or interest in or to any of the Licensed Compounds, Licensed Products, Licensed Technology, Joint Collaboration IP, or any Haisco Regulatory Documentation (including by granting any covenant not to sue with respect thereto) in a manner that would interfere with Haisco’s performance of its obligations under this Agreement or limit or diminish the rights or licenses granted to Licensee under this Agreement. Licensee will not, and will cause its Affiliates not to, enter into any agreement with respect to, or otherwise assign, transfer, license, convey or otherwise encumber its right, title or interest in or to any of the Licensee Collaboration IP, including Regulatory Documentation contained therein, or Joint Collaboration IP (including by granting any covenant not to sue with respect thereto) in a manner that would interfere with Licensee’s performance of its obligations under this Agreement or limit or diminish the rights or licenses granted to Haisco under this Agreement. 10.5 Data Privacy and Security. 10.5.1 General. With respect to any Personal Data contained in Know-How that a Party is required under this Agreement to transfer to or share with the other Party and that is in such Party’s possession, custody or control as part of such Party’s performance hereunder, including during Exploitation, Development and Manufacturing activities and the preparation and transmission of Personal Data from one Party to the other Party, each Party will: |
| 68 (a) comply with its respective obligations under applicable Data Protection Laws; (b) at all times during the Term, not act in a manner that would render it subject to any prohibition or restriction that would (i) prevent or materially restrict it from disclosing or transferring Personal Data to the other Party, as may be required under this Agreement; or (ii) prevent or materially restrict it from Processing the Personal Data as envisaged under this Agreement. If either Party becomes aware of any circumstances which it believes, acting reasonably, may give rise to such a prohibition or restriction, it will promptly notify the other Party of the same and the Parties will take commercially reasonable steps, including reasonable mutual cooperation, to ensure that it does not impact its performance of its obligations under Section 10.4.5 or 10.5; (c) as required by their respective obligations under applicable Data Protection Laws and under this Agreement, at all times during the Term, to the extent it is the Party collecting the relevant Personal Data, provide all notices and obtain all consents (or rely on another valid lawful basis allowed under applicable Data Protection Laws) that are sufficient in scope to permit the lawful disclosure and transfer of such personal Data to the other Party and to Process such Personal Data as required in order to (i) comply with its obligations under this Agreement and Applicable Laws; and (ii) obtain the benefit of its rights and fulfil its obligations under this Agreement (including the transfer of all applicable Personal Data). The Party that collected relevant Personal Data will promptly notify the other Party to the extent such relevant Personal Data has been transferred to the other Party and if any such consent or lawful basis is withdrawn or materially limited and will, at its own cost, take commercially reasonable measures in compliance with applicable Data Protection Laws designed to secure an alternative lawful basis or otherwise mitigate any resulting impact on the other Party’s Processing of the Personal Data; (d) implement and maintain commercially reasonable administrative, technical, and physical safeguards designed to (i) maintain the security and privacy of the Personal Data; and (ii) protect against reasonably anticipated threats or hazards to the security, privacy, availability or integrity of the Personal Data; (e) notify the other Party promptly in writing and without undue delay following receipt of any written correspondence from: (i) a Governmental Authority in relation to the Processing of Personal Data related to this Agreement, or (ii) a data subject exercising their rights under applicable Data Protection Laws such as to access, rectify or delete their Personal Data in relation to the Personal Data Processed under this Agreement; (f) reasonably cooperate with the other Party to enable the other Party to fulfil its obligations, as applicable, under applicable Data Protection Laws; and (g) upon reasonable prior written notice, no more than once annually (except in the event of a regulator inquiry or a Data Breach), each Party may request and the other Party agrees to provide, within a reasonable timeframe, documentation and written attestations reasonably sufficient to verify compliance with the privacy and data security obligations under this Agreement, including the completion of a reasonable privacy and data security questionnaire mutually agreed by both Parties. Each party will bear its own costs in relation to such requests. 10.5.2 Joint Controllership. If, and to the extent that, the Parties jointly determine the purposes and means of Processing Personal Data under this Agreement, and applicable Data Protection Laws recognize the concept of Joint Controllers, the Parties acknowledge and agree that they are Joint Controllers with respect to such Processing. Where, and only to the extent, required by applicable Data Protection Laws, the Parties will negotiate in good faith to enter into an |
| 69 arrangement or addendum to this Agreement that details their respective obligations under Data Protection Laws as Joint Controllers with respect to such Personal Data. 10.5.3 Data Breach. With respect to Personal Data Processed under the Agreement in its possession, custody or control, each Party will notify the other Party promptly and without undue delay upon learning of any (a) unauthorized access to, or acquisition, disclosure or other Processing of such Personal Data; or (b) other event or circumstance that constitutes a “personal data breach” or similar term as defined under applicable Data Protection Laws (collectively, a “Data Breach”). The Party that experienced the Data Breach will promptly investigate each Data Breach that it becomes aware of or has reason to suspect may have occurred and will provide commercially reasonable levels of access and information to the other Party as reasonably requested, in writing, by the other Party. The Parties will reasonably cooperate in identifying any reasonable steps that should be implemented to limit or stop a Data Breach including, in so far as required by Applicable Law, fulfilment of related reporting obligations to Governmental Authorities. 10.5.4 Compliance with Applicable Data Protection Laws. In the event either Party reasonably determines that applicable Data Protection Laws require the Parties to execute any additional documents or agreements, the Parties will negotiate in good faith to execute and implement such documents or agreements, including a cross-border data transfer agreement, a transfer impact assessment, a data protection addendum or data protection impact assessment. 10.6 DISCLAIMER OF WARRANTIES. EXCEPT FOR THE EXPRESS WARRANTIES SET FORTH HEREIN, NEITHER PARTY MAKES ANY REPRESENTATIONS OR GRANTS ANY WARRANTIES, EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, BY STATUTE OR OTHERWISE AND EACH PARTY SPECIFICALLY DISCLAIMS ANY OTHER WARRANTIES, WHETHER WRITTEN OR ORAL OR EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF QUALITY, MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE OR PURPOSE OR ANY WARRANTY AS TO THE VALIDITY OF ANY PATENTS OR THE NON-INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES. ARTICLE XI INDEMNITY; LIMITATION OF LIABILITY 11.1 Indemnity. 11.1.1 Haisco Indemnification Obligations. Haisco will defend, indemnify and hold harmless Licensee, any of its Affiliates and its and their respective directors, officers, employees and agents (the “Licensee Indemnitees”) from and against all liabilities, losses, damages, and expenses, including reasonable attorneys’ fees and costs (collectively, “Liabilities”), incurred by or imposed on any of the Licensee Indemnitees as a result of any Third Party claims, suits, actions, terminations or demands (collectively, “Claims”) to the extent such Claims are incurred, relate to, are in connection with or arise out of: (a) the breach or non-fulfillment of any representations, warranties or covenants in this Agreement by Haisco; (b) the negligence, recklessness or willful misconduct of Haisco, any of its Affiliates, sublicensees, licensees or Subcontractors or any other Haisco Indemnitees in connection with the performance of Haisco’s obligations or exercise of its rights hereunder; |
| 70 (c) the Exploitation of any Licensed Compounds or Licensed Product or the Haisco FDC Product by Haisco, its Affiliates, (sub)licensees, or Subcontractors, including prior to the Effective Date, during the Term in the Haisco Territory, or after the effective date of termination for a Terminated Product, Terminated Territory or termination of the entirety of this Agreement; (d) any United States withholding or similar taxes imposed by a Governmental Authority with respect to any amounts payable to Haisco pursuant to this Agreement (excluding (1) any Indirect Taxes, and (2) any such taxes arising as a result of a Withholding Tax Action which, for the avoidance of doubt, shall be borne by the Licensee as set forth in Section 7.10.1), but only to the extent that such taxes arise solely and directly from Haisco’s failure to timely provide complete and accurate tax forms or other information to such Governmental Authority as required under Applicable Laws. For avoidance of doubt, Haisco shall have no indemnification obligation under this subsection (d) for (i) any Claims arising from or related to Licensee’s failure to deduct or withhold taxes when required, or to timely pay any withheld amounts to a Governmental Authority, (ii) any tax liabilities that could have been avoided or reduced by Licensee’s reasonable efforts to claim a refund or exception under an applicable tax treaty, or (iii) or any other Claims or tax liabilities caused by Licensee’s negligence or willful misconduct. Notwithstanding the foregoing, the indemnification obligations under this Section 11.1.1 will not apply to the extent such Liabilities resulted from any action for which Licensee must indemnify Haisco under Section 11.1.2. 11.1.2 Licensee Indemnification Obligations. Licensee will defend, indemnify and hold harmless Haisco, its Affiliates and its and their respective directors, officers, employees and agents (the “Haisco Indemnitees”) from and against all Liabilities incurred by or imposed on any of the Haisco Indemnitees as a result of any Claims to the extent such Claims are incurred, relate to or arise out of: (a) the breach or non-fulfillment of any representations, warranties or covenants in this Agreement by Licensee; (b) the negligence, recklessness or willful misconduct of Licensee, its Affiliates, Sublicensees or Subcontractors or any other Licensee Indemnitees in connection with the performance of Licensee’s obligations or exercise of its rights hereunder; (c) any United States withholding or similar taxes imposed by a Governmental Authority with respect to any amounts payable to Haisco pursuant to this Agreement, except to the extent caused by Haisco’s negligence or willful misconduct; or (d) the Exploitation of any Licensed Compounds or Licensed Products by Licensee, its Affiliates, Sublicensees or Subcontractors. Notwithstanding the foregoing, the indemnification obligations under provisos (a) through (c) in this Section 11.1.2 will not apply to the extent such Liabilities resulted from any action for which Haisco must indemnify Licensee under Section 11.1.1. 11.2 Procedure. 11.2.1 A Party (the “Indemnitee”) that intends to claim indemnification under this Section 11.2 will promptly provide notice to the other Party (the “Indemnitor”) of any Claim in respect of which the Indemnitee intends to claim such indemnification, which notice will include a reasonable identification of the alleged facts giving rise to such Liability, and the Indemnitor will |
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| 72 ARTICLE XII TERM AND TERMINATION 12.1 Term. The term of this Agreement will commence upon the Effective Date and, unless earlier terminated pursuant to this ARTICLE XII, will continue in full force and effect until, on a Licensed Product-by-Licensed Product basis, the expiration of Licensee’s payment obligations under ARTICLE VII with respect to such Licensed Product (the “Term”). 12.2 Termination. 12.2.1 Termination for Absence of Financing Closing. If the Financing Closing has not occurred on or before thirty (30) Business Days following the Execution Date, either Party may terminate this Agreement upon written notice to the other Party, effective upon such notice, and this Agreement shall thereafter have no further force or effect, except as otherwise expressly provided herein. If the Subsequent Financing Closing has not occurred within six (6) months following the Effective Date, Haisco may terminate this Agreement upon written notice to Licensee, effective upon such notice, and this Agreement shall thereafter have no further force or effect, except as otherwise expressly provided herein. 12.2.2 Termination by Licensee for Convenience. Licensee may terminate this Agreement in its entirety, or on a country-by-country or Licensed Product-by-Licensed Product basis, by providing ninety (90) days’ prior written notice of termination to Haisco; provided that if Licensee wishes to exercise its termination rights under this Section 12.2.1 after the First Commercial Sale of a Licensed Product, it will provide Haisco with one hundred twenty (120) days’ prior written notice. During such ninety (90) or one hundred twenty (120)-day notice period, as applicable, each Party will continue to perform all of its obligations under this Agreement then in effect unless otherwise agreed by the Parties. 12.2.3 Termination by Either Party for Material Breach. If either Party believes that the other is in material breach of this Agreement, then the non-breaching Party may deliver notice of such breach to the other Party. The allegedly breaching Party will have thirty (30) days from such notice to dispute or cure any payment breach, or sixty (60) days from such notice (the “Cure Period”) to dispute or cure any other breach. Notwithstanding the foregoing, if (a) the relevant breach (i) does not involve Licensee’s failure to make a payment when due and (ii) is curable, but not reasonably curable within the Cure Period, and (b) Licensee is making a reasonable effort to cure such breach, Haisco’s right to terminate this Agreement on account of such breach will be suspended for no more than an additional thirty (30) days’ period (such 30-day period, the “Additional Cure Period”) so long as Licensee is continuing to make such reasonable effort to cure such breach during such thirty (30) days’ period; provided that, if such breach is related to Licensee’s alleged failure to use Commercially Reasonable Efforts in accordance with Section 5.3 (which the Parties agree is a curable breach), Licensee will, no later than forty five (45) days prior to the end of the Cure Period, submit to Haisco a cure plan with specific actions that Licensee needs to perform within the Additional Cure Period in order to cure the breach (the “Cure Plan”), following which the Parties will evaluate whether such Cure Plan is acceptable to both Parties; provided the Parties must accept the Cure Plan within the Cure Period, and Licensee will conduct the specific actions set forth in the mutually-agreed upon Cure Plan. If such breach is successfully cured prior to the end of such Additional Cure Period, Haisco will no longer have the right to terminate this Agreement on account of such breach. If the Party receiving notice of material breach under this Agreement fails to cure, or fails to dispute, such breach (and, in the case of Licensee as the breaching Party, fails to submit the Cure Plan, or the Parties fail to agree upon the Cure Plan, if applicable) within the applicable time period set forth above, then the Party originally delivering the notice of material |
| 73 breach may terminate this Agreement effective on written notice of termination to the other Party. If the allegedly breaching Party in good faith disputes such material breach or disputes the failure to cure or remedy such material breach, and provides written notice of that dispute to the other Party within the applicable periods set forth above, the matter will be addressed under the dispute resolution provisions in Section 13.3 (provided that any undisputed amounts will be paid by Licensee). During the pendency of any such dispute, (1) all of the terms and conditions of this Agreement will remain in effect, (2) the time periods for cure under this Section 12.2.3 will be tolled, and (3) the Parties will continue to perform all of their respective obligations hereunder. In the event of any such material breach and the subsequent failure to cure is solely with respect to (x) one or more countries in the Territory, but not all of the Territory or (y) certain (but not all) Licensed Products, then the non-breaching Party will not have the right to terminate this Agreement in its entirety, but will have the right to terminate this Agreement solely with respect to (I) the country in which such material breach and failure to cure occurred, or (II) Licensed Product(s) with respect to which such material breach and failure to cure occurred, and this Agreement will remain in full force and effect with respect to all other countries in the Territory, and the other Licensed Products. 12.2.4 Termination by Either Party for Insolvency. In the event that either Party (a) makes an assignment for the benefit of creditors, (b) appoints or suffers appointment of a receiver or trustee over substantially all of its property that is not discharged within ninety (90) days after such filing, (c) proposes a written agreement of composition or extension of its debts generally, (d) files for dissolution or liquidation, (e) files a petition under any bankruptcy or insolvency act or has any such petition filed against it that is not discharged within sixty (60) days of the filing thereof, or (f) admits in writing its inability generally to meet its obligations as they fall due in the general course (each, an “Insolvency Event”), then the other Party may terminate this Agreement in its entirety effective immediately upon written notice to such Party. 12.2.5 Termination by Haisco for Patent Challenge. Haisco may terminate this Agreement in its entirety immediately upon written notice to Licensee if Licensee, any of its Affiliates, or any of its Sublicensees, directly or indirectly (including through assistance granted to a Third Party or otherwise), including through the filing of applicable documents, motions or pleadings with a governmental authority of competent jurisdiction, (i) commences any interference or opposition proceeding or other challenge to the validity or enforceability of any Licensed Technology or (ii) otherwise opposes any extension of, or the grant of any supplementary protection certificate with respect to any Licensed Technology (collectively, a “Patent Challenge”); provided, however, that that this Section 12.2.5 will not apply to any Patent Challenge that (a) is first made by the Licensee or any of its Affiliates or Sublicensees in defense of a claim of patent infringement brought by Haisco under the applicable Patent rights or any Patent Challenge, or (b) is brought by any non-Affiliate Sublicensee if the Licensee (1) causes such Patent Challenge to be terminated or dismissed (or in the case of ex-parte proceedings, multi-party proceedings, or other Patent Challenges in which the challenging party does not have the power to unilaterally cause the Patent Challenge to be withdrawn, causes such Sublicensee to withdraw as a party from such Patent Challenge and to cease actively assisting any other party to such Patent Challenge), and (2) terminates such Sublicensee’s Sublicense to the Patent rights being challenged by such Sublicensee, within thirty (30) days after Haisco’s written notice to the Licensee of such Patent Challenge. 12.2.6 Termination by Haisco for Shelving. Haisco may terminate this Agreement on a Program-by-Program basis upon sixty (60) days’ written notice to Licensee if, after the Effective Date and prior to the First Commercial Sale of a Licensed Product for a Program, Licensee, its Affiliates and its and their Sublicensees have ceased any material Development of all Licensed Compounds for such Program for a period of twelve (12) consecutive months and such failure to conduct any material Development is not due to (i) the mutual agreement by the Parties, |
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| 75 expiration of this Agreement and the fulfillment of all payment obligations under this Agreement with respect to all Licensed Products for such Program in all countries in the Territory pursuant to ARTICLE VII, the rights and licenses granted to Licensee and its Affiliates under Sections 2.1, 5.4 and 5.6 with respect to all Licensed Products for such Program in all countries in the Territory will become fully paid-up, royalty-free, perpetual and irrevocable. 12.3.3 Effect of Termination. Upon the termination of this Agreement in its entirety or with respect to a Program, Terminated Product or Terminated Territory, (i) all rights and licenses granted by Haisco to Licensee under Sections 2.1, 5.4 and 5.6 will terminate in their entirety or with respect to such Program, Terminated Product or Terminated Territory, as applicable, and (ii) Licensee, its Affiliates and its and their Sublicensees will cease all use of the Licensed Technology with respect to such Program, Terminated Product or Terminated Territory, as applicable, and all exploitation of such Program, Terminated Product, all Licensed Products in such Terminated Territory, or such Terminated Product in such Terminated Territory, as applicable, in each case ((i) - (ii)), except to the extent required to exercise its rights and fulfill its obligations under this Section 12.3.3, and the following provisions will apply: (a) Payments. All payments payable under this Agreement with respect to a terminated Program, Terminated Product or Terminated Territory are due upon the applicable effective date of termination and Licensee shall pay such payments to Haisco within thirty (30) days after such effective date of termination; provided that if Licensee fails to make full payment within thirty (30) days after such date of termination, Haisco is entitled to charge Licensee interest on the amount unpaid, calculated from such date of termination until full payment is made and clear funds are received by Haisco in accordance with Section 7.8.1. (b) Inventory Sell-Off Period. In the case of a termination of this Agreement with respect to a Program, Terminated Product or Terminated Territory, Licensee (with respect to the terminated Program, Terminated Products in the Territory or with respect to all Licensed Products in the Terminated Territory, as applicable), will be entitled, for a period of one hundred and eighty (180) days after termination, to (i) complete Manufacture of work-in-progress, and (ii) continue conducting Commercialization activities being conducted by Licensee hereunder as of such termination (with respect to the terminated Program, Terminated Products in the Territory or with respect to all Licensed Products in the Terminated Territory, as applicable), to the extent related to such terminated Program, Terminated Product in Licensee’s inventory or all Licensed Products in Licensee’s inventory for such Terminated Territory as of such termination (or added to such inventory as a result of the completion described in clause (i) above), provided that Licensee fulfills its payment obligations under this Agreement in connection with such inventory sell-off. For clarity, from and after the expiration of such one hundred and eighty (180)-day period, all rights and licenses granted to Licensee hereunder (if applicable, with respect to the terminated Program, Terminated Products or Terminated Territory, as applicable) will terminate (except as necessary to permit Licensee to perform its obligations under this ARTICLE XII). (c) Regulatory Documentation; Data. Upon termination of this Agreement with respect to a Program, Terminated Product or Terminated Territory, Licensee will promptly transfer and assign to Haisco all Regulatory Approvals Controlled by Licensee or its Affiliates relating to such terminated Program, Terminated Product and, to the extent not previously provided to Haisco, transfer all other Regulatory Documentation, including data from preclinical, non-clinical studies and Clinical Trials conducted by or on behalf of Licensee on such terminated Program, Terminated Products or with respect to the Terminated Territory, as applicable, and all pharmacovigilance data (including all adverse event databases) on such terminated Program, Terminated Products or with respect to the Terminated Territory, as applicable, in each case Controlled by Licensee or its Affiliates; provided that such Regulatory Documentation may be redacted at Licensee’s discretion if required to protect competitively sensitive |
| 76 information of Licensee that is not necessary to Exploit the Terminated Products. Licensee’s activities under this Section 12.3.3 will be conducted at no cost to Haisco in the case of a termination by Haisco pursuant to Sections 12.2.3, 12.2.4, 12.2.5 or 12.2.6, by Licensee pursuant to Sections 12.2.2, or by mutual agreement of the Parties, or otherwise Haisco will reimburse Licensee for all reasonable documented out-of-pocket costs incurred by Licensee or its Affiliates in conducting such activities. (d) Trademarks. Upon written request by Haisco, Licensee will promptly transfer and assign, and will ensure that its Affiliates transfer and assign, to Haisco, at no cost to Haisco, all Product Trademarks Controlled by Licensee or its Affiliates exclusively relating to any Terminated Product Commercialized prior to the effective date of such termination, provided that such Product Trademarks do not contain the business entity names of Licensee or its Affiliates or variations thereof, except as may otherwise be required by Applicable Law during a transition period to avoid any interruptions in supply of such Terminated Product to patients. In such case if requested by Licensee, Haisco will sign a non-royalty bearing trademark license agreement with customary and reasonable terms in the form mutually agreed by the Parties, as requested by Licensee. (e) Ongoing Development Activities. Licensee will, as directed by Haisco, either (A) wind-down any ongoing Development activities of Licensee and its Affiliates with respect to the Licensed Products in a manner as directed by Haisco, and use Commercially Reasonable Efforts to cause its Sublicensees to do the same, or (B) promptly transfer, and use Commercially Reasonable Efforts to cause its Sublicensees to promptly transfer, the responsibility and control of such Development activities to Haisco or its designee, in either case in compliance with all Applicable Laws. In the event such Development activities are to be transferred to Haisco or its designee, Licensee will use Commercially Reasonable Efforts to transfer and to assist Haisco or its designee to assume responsibility for and control of such Development activities. (f) License to Haisco. In the case of a termination by Haisco pursuant to Sections 12.2.3, 12.2.4, 12.2.5 or 12.2.6, by Licensee pursuant to Sections 12.2.2, or by mutual agreement of the Parties, all rights and licenses granted by Licensee to Haisco under Sections 2.1, 5.4 and 5.6 will become fully paid-up, royalty-free, sublicensable, worldwide, perpetual and irrevocable, effective upon the effective date of termination of this Agreement with respect to a Terminated Product or Terminated Territory. On written request from Haisco, Licensee will, and hereby does, effective upon the effective date of termination of this Agreement with respect to a Terminated Product or Terminated Territory by Licensee pursuant to Section 12.2.3, 12.2.4, as applicable, grant to Haisco an exclusive, royalty-bearing, license, with the right to grant sublicenses through multiple tiers, under the Licensee Collaboration IP Controlled by Licensee or its Affiliates as of the effective date of such termination that is necessary to Exploit such Terminated Product and the Licensed Compound contained therein in the Terminated Territory under this Agreement as they exist and are being Developed or Commercialized by or on behalf of Licensee or its Affiliates or Sublicensees as of the effective date of such termination (or any modification or improvement to such Terminated Product or such Licensed Compound made and Developed or Commercialized by or on behalf of Haisco or its Affiliates or (sub)licensees after the effective date of such termination; provided the foregoing license will not include any Licensee Collaboration IP that is necessary to Exploit such modification or improvement) (all such Terminated Products and modified or improved Terminated Products, collectively “Territory Reversion Products”) to Exploit such Territory Reversion Products and the Licensed Compounds contained therein in the Field in such Terminated Territory. For clarity, unless otherwise agreed by the Parties, the foregoing license will not include any intellectual property right generated or otherwise acquired by Licensee or any of its Affiliates or Sublicensees after the effective date of the termination. For so long as the Territory Reversion Products are Commercialized in the Terminated Territory, on a Territory Reversion Product-by-Territory Reversion Product and country-by-country basis, Haisco will pay to Licensee a royalty on Net Sales (as defined in Section 1.1.71, but applied to Haisco as Licensee and (sub)licensees as Sublicensees mutatis mutandis) of such Territory Reversion Product in such |
| 77 Terminated Territory for the period commencing upon the First Commercial Sale by Haisco, its Affiliates or (sub)licensees of such Territory Reversion Product in such Terminated Territory following such termination and ending upon the tenth (10th) anniversary of such First Commercial Sale at a royalty rate mutually agreed by the Parties (which the Parties will negotiate in good faith). If the Parties fail to reach agreement with respect to such royalty rate within thirty (30) days after Haisco’s written request to negotiate such royalty rate, then either Party may, by written notice to the other Party, initiate the procedures to determine the royalty rate through baseball arbitration pursuant to Schedule 12.3. Upon Haisco’s fulfillment of all payment obligations under this Section 12.3.3(f) with respect to a Territory Reversion Product and country in the Terminated Territory or a Licensed Product and jurisdiction in the Haisco Territory, the licenses granted to Haisco and its Affiliates under this Section 12.3.3(f) with respect to such Territory Reversion Product and country in the Terminated Territory or such Licensed Product and jurisdiction in the Haisco Territory will become fully paid-up, royalty-free and irrevocable. 12.4 Termination Public Disclosures. In the event of termination of this Agreement for any reason, the Parties will cooperate in good faith to coordinate public disclosure of such termination and the reasons therefor, and, except to the extent required by Applicable Law, will not disclose such information without the prior approval of each other Party. The principles to be observed in such disclosures will be accuracy, compliance with Applicable Laws and regulatory guidance documents, and reasonable sensitivity to potential negative investor reaction to such news. 12.5 Survival. Expiration or termination of this Agreement will not relieve the Parties of any obligation, liability or claim arising or accruing prior to such expiration or termination. Without limiting the foregoing, the following provisions will survive the expiration or termination of this Agreement (for only the duration of time specified therein, if applicable): ARTICLE I (to the extent necessary to interpret the surviving provisions hereof) and ARTICLE XI; Sections 2.1 (which will survive expiration but not termination, except as provided in Section 12.3.3), 2.3 (with respect to any license granted under Section 12.3.3(f)), 2.5 (with respect to any license granted under this Agreement that survives expiration or termination), the fifth-to-last sentence and the second-to-last sentence of 5.4 (which will survive expiration but not termination, except as provided in Section 12.3.3), 5.6 (which will survive expiration but not termination, except as provided in Section 12.3.3), 7.2 (with respect to payments that accrued prior to expiration or termination), 7.3 - 7.6 (with respect to payments that accrued prior to expiration or termination or accrued following termination pursuant to Section 12.3.3(a)), 7.7 - 7.10, 7.11 (with respect to sales of Licensed Product during the Term or under Section 12.3.3(a)), 7.12, 7.13, 7.14, 8.1, 8.2, 8.5, 8.6, 9.1, 9.9, 10.4.7 - 10.4.8 (in each case, with respect to any license granted under this Agreement that survives expiration or termination or any license granted under Section 12.3.3(f); provided that the last sentence of each provision will survive the termination, but not expiration, of this Agreement), 10.6, 12.3 - 12.5, 13.1 - 13.8, 13.9 (which, excluding the second-to-last and the third-to-last sentences, will survive termination or expiration of this Agreement; and with respect to the third-to-last sentence, will survive the expiration but not termination of this Agreement; and with respect to the second-to-last sentence, will survive termination or expiration of this Agreement solely with respect to any license granted under this Agreement that survives expiration or termination or any license granted under Section 12.3.3(f)), and 13.10 - 13.19 (other than Sections 13.15.4, 13.16.2 and 13.16.3). ARTICLE XIII MISCELLANEOUS 13.1 Effectiveness of the Agreement. Except for the Parties’ rights and obligations under Article I, Article VIII, Article XIII, Section 5.3.1, Section 10.1 , Section 10.2 (except Section 10.2.10), Section 10.3 and Section 12.2.1, which will be effective as of the Execution Date, this Agreement will not become effective until the Effective Date. As of the Effective Date, all other provisions of this Agreement will become effective automatically without the need for further action by the Parties. |
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| 79 13.3.1 The Alliance Manager of the Party claiming that such a Dispute exists will give notice in writing (“Notice of Dispute”) to the other Party of the nature of the Dispute. 13.3.2 Within fifteen (15) Business Days following receipt of a Notice of Dispute, the Designated Senior Officers of Licensee and Haisco will endeavor to meet at a mutually agreed upon time for the purpose of resolving such Dispute. 13.3.3 If the Dispute is not resolved within fifteen (15) Business Days after receipt of the Notice of Dispute, then either Party will have the right to commence arbitration in accordance with Section 13.5, subject to Section 13.5.2. 13.3.4 In the event of a dispute regarding any payments owing under this Agreement, all undisputed amounts will be paid promptly when due and the balance, if any, promptly after resolution of the dispute. 13.4 Governing Law. This Agreement will be governed by and construed in accordance with the laws of the state of Delaware, excluding any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of this Agreement to the substantive law of another jurisdiction. The Parties agree to exclude the application to this Agreement of the United Nations Convention on Contracts for the International Sale of Goods. 13.5 Arbitration. 13.5.1 Except as provided in Section 13.14 and 13.5.2, any Dispute, including the determination of the scope or applicability of this agreement to arbitrate and the propriety of commencing arbitration, will be finally determined by arbitration in accordance with this Section 13.5. The arbitration will be conducted in English and will be administered by the International Court of Arbitration of the International Chamber of Commerce (the “ICC”) in accordance with the Rules of Arbitration of the ICC in effect at the time of the arbitration (the “ICC Rules”), except as modified herein. The seat of arbitration will be in San Francisco, California, U.S.A. (a) The arbitration will be conducted by three (3) arbitrators (the “Arbitrators”). Each Party will nominate one Arbitrator in accordance with the ICC Rules, and the two Party-nominated Arbitrators will nominate the third Arbitrator, who will act as chair of arbitral tribunal, within twenty (20) days of the second Arbitrator’s appointment. If any of the three Arbitrators are not nominated within the time prescribed above, then the ICC will appoint the Arbitrator(s). The Arbitrators may appoint one or more independent experts with experience in the subject matter of the dispute to advise the Arbitrators, but final decision-making authority will remain with the Arbitrators. If any expert is so appointed, the Parties will have the right to review such expert’s report(s) to the Arbitrators and to examine such expert at an oral hearing. (b) Notwithstanding the ICC Rules, and unless otherwise agreed to by both Parties, the following procedures will apply to any proceeding conducted pursuant to this Section 13.5: (i) the Arbitrators will submit their final award in draft form to the ICC Court within three (3) months from the later of the date of the last hearing or the final post-hearing submission; no award issued by the Arbitrators will be rendered invalid or improper by reason of it be delivered after the expiry of this time limit; and (ii) fact discovery will be limited to five (5) custodial document productions per Party and three (3) fact depositions per Party. (c) The arbitration award will be final and binding on the Parties, and the Parties undertake to carry out any award without delay. Notwithstanding Section 13.5.1 regarding the |
| 80 substantive governing law, the arbitration and this agreement to arbitrate will be governed by the Federal Arbitration Act, 9 U.S.C. § 1 et seq. Each Party will have the right to be represented by counsel in all aspects of any arbitration. The allocation of expenses of the arbitration, including reasonable attorney’s fees, will be determined by the Arbitrators; provided that, in the absence of such determination, the Parties will share equally the cost of the hearing location and stenographers, the fees and expenses of any independent expert appointed by the Arbitrators and the fees and expenses of the Arbitrators and administrative fees of ICC, and each Party will bear its own costs, attorneys’ and witnesses’ fees and associated costs and expenses. (d) Settlement negotiations, including any statements made therein, will not be admissible under any circumstances. As to all other matters, the Arbitrators will have sole discretion regarding the admissibility of any evidence. Except as necessary for enforcement or challenge of an award, or as required by law, the existence and contents of the Dispute, any settlement negotiations, the arbitration, any submissions (including exhibits, testimony, proposed rulings, and briefs), and the rulings will be deemed to be Confidential Information of both Parties under ARTICLE VIII. The Arbitrators will have the authority to impose sanctions for unauthorized disclosure of Confidential Information. 13.5.2 Notwithstanding Section 13.5.1, any and all Disputes regarding the validity, scope, construction, patentability, enforceability, or inventorship of any Patent or other intellectual property rights, unless otherwise agreed by the Parties in writing, will be determined solely by a court or other tribunal, as the case may be, of competent jurisdiction under the applicable patent laws of the country or other jurisdiction in which such patent application is filed or such Patent is issued or granted, or such other intellectual property right exists, as applicable, and no such Dispute will be subject to arbitration under Section 13.5.1. 13.6 Entire Agreement. This Agreement, together with the Schedules attached hereto and the Ancillary Agreements, together with any schedules or exhibits attached thereto, contains the entire understanding of the Parties with respect to the specific subject matter hereof. All express or implied agreements and understandings, either oral or written, heretofore made with respect to the specific subject matter hereof are expressly superseded by this Agreement, including the CDA. The CDA is hereby terminated effective as of the Effective Date. This Agreement may be amended, or any term hereof modified, only by a written instrument duly executed by both Parties. 13.7 Severability. If any provision of this Agreement is held to be illegal, invalid or unenforceable under any present or future law and if the rights or obligations of either Party under this Agreement will not be materially and adversely affected thereby, (a) such provision will be fully severable, (b) this Agreement will be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part hereof, (c) the remaining provisions of this Agreement will remain in full force and effect and will not be affected by the illegal, invalid or unenforceable provision or by its severance herefrom, and (d) in lieu of such illegal, invalid or unenforceable provision, there will be added automatically as a part of this Agreement a legal, valid and enforceable provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible and reasonably acceptable to the Parties. To the fullest extent permitted by Applicable Law, each Party hereby waives any provision of law that would render any provision hereof illegal, invalid or unenforceable in any respect. 13.8 Force Majeure. Neither Party will be held liable or responsible to the other Party or be deemed to have defaulted under or breached this Agreement for failure or delay in fulfilling or performing any term of this Agreement (other than an obligation to make payments) when such failure or delay is caused by or results from events beyond the reasonable control of the non-performing Party, including fires, floods, earthquakes, hurricanes, embargoes, shortages, epidemics, quarantines, war, acts of war (whether war be declared or not), terrorist acts, insurrections, riots, civil commotion, strikes, lockouts or other labor disturbances (whether involving the workforce of the non-performing Party or of any other Person), acts of |
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| 82 have any rights or obligations under this Agreement. All validly assigned rights of a Party will inure to the benefit of and be enforceable by, and all validly delegated obligations of a Party will be binding on and be enforceable against, the permitted successors and assigns of such Party. Notwithstanding anything to the contrary herein, Haisco will not assign this Agreement unless such assignee is assigned all of Haisco’s rights and interest under the Licensed Technology and Joint Collaboration IP that is licensed to Licensee hereunder, and vice versa. For any assignment of this Agreement by Licensee that does not include an assignment to the assignee of all of Licensee’s rights and interest under the Licensee Collaboration IP and Joint Collaboration IP that is licensed to Haisco hereunder, and vice versa, Licensee hereby agrees to grant or obtain, as applicable, sufficient rights and licenses from such assignee to such Licensee Collaboration IP and Joint Collaboration IP necessary to allow Haisco’s rights and licenses under such Licensee Collaboration IP and Joint Collaboration IP to continue in accordance with the terms of this Agreement. Any attempted assignment or delegation in violation of this Section 13.9 will be void and of no effect. 13.10 Relationship of the Parties. It is expressly agreed that Haisco, on the one hand, and Licensee, on the other hand, will be independent contractors and that the relationship between the Parties will not constitute a partnership, joint venture or agency. Neither Haisco, on the one hand, nor Licensee, on the other hand, will have the authority to make any statements, representations or commitments of any kind, or to take any action that will be binding on the other, without the prior written consent of the other Party to do so. Neither Party will treat or report the relationship between the Parties as a partnership for any tax purpose, unless otherwise required pursuant to a determination within the meaning of Section 1313 of the Internal Revenue Code of 1986, as amended. 13.11 Waiver and Non-Exclusion of Remedies. Any term or condition of this Agreement may be waived at any time by the Party that is entitled to the benefit thereof, but no such waiver will be effective unless set forth in a written instrument duly executed by or on behalf of the Party waiving such term or condition. The waiver by either Party hereto of any right hereunder or of the failure to perform or of a breach by the other Party will not be deemed a waiver of any other right hereunder or of any other breach or failure by such other Party whether of a similar nature or otherwise. The rights and remedies provided herein are cumulative and do not exclude any other right or remedy provided by Applicable Law or otherwise available except as expressly set forth herein. 13.12 Further Assurances. Each Party will duly execute and deliver or cause to be duly executed and delivered, such further instruments and do and cause to be done such further acts and things, including the filing of such assignments, agreements, documents and instruments, as may be necessary or as the other Party may reasonably request in connection with this Agreement or to carry out more effectively the provisions and purposes hereof or to better assure and confirm unto such other Party its rights and remedies under this Agreement. 13.13 No Benefit to Third Parties. Except as expressly provided in ARTICLE XI, the covenants and agreements set forth in this Agreement are for the sole benefit of the Parties hereto and their successors and permitted assigns and they will not be construed as conferring any rights on any other parties. 13.14 Equitable Relief. Each Party acknowledges and agrees that the restrictions set forth in Section 2.5, ARTICLE VIII and ARTICLE IX are reasonable and necessary to protect the legitimate interests of the other Party and that such other Party would not have entered into this Agreement in the absence of such restrictions and that any breach or threatened breach of any provision of such Section or Articles may result in irreparable injury to such other Party for which there will be no adequate remedy at law. Notwithstanding Section 13.3 and Section 13.5, in the event of a breach or threatened breach of any provision of such Section or Articles, the non-breaching Party will be authorized and entitled to seek from any court of competent jurisdiction injunctive relief, whether preliminary or permanent, and specific |
| 83 performance, which rights will be cumulative and in addition to any other rights or remedies to which such non-breaching Party may be entitled in law or equity. Both Parties agree to waive any requirement that the other (a) post a bond or other security as a condition for obtaining any such relief and (b) show irreparable harm, balancing of harms, consideration of the public interest or inadequacy of monetary damages as a remedy. Nothing in this Section 13.14 is intended or should be construed, to limit either Party’s right to equitable relief or any other remedy for a breach of any other provision of this Agreement. 13.15 Rights in Bankruptcy. 13.15.1 All rights and licenses now or hereafter granted by Haisco to Licensee under or pursuant to this Agreement, are, for all purposes of Section 365(n) of the Bankruptcy Code or comparable provisions of applicable bankruptcy or insolvency laws in any other jurisdiction, licenses of rights to “intellectual property” as defined in the Bankruptcy Code or in comparable provisions of applicable bankruptcy or insolvency laws in any other jurisdiction. If a petition under any bankruptcy or insolvency act is filed with respect to Haisco, Haisco agrees that Licensee, as licensee of such rights under this Agreement, will retain and may fully exercise all of its rights and elections under the Bankruptcy Code and under the applicable bankruptcy or insolvency laws in any other jurisdiction. Without limiting the generality of the foregoing, Haisco and Licensee intend and agree that any sale of Haisco’s assets under Section 363 of the Bankruptcy Code or comparable provisions of applicable bankruptcy or insolvency laws in another jurisdiction will be subject to Licensee’s rights under Section 365(n) or comparable provisions of applicable bankruptcy or insolvency laws in another jurisdiction to the maximum extent permitted thereby. Haisco will, during the Term of this Agreement, create and maintain current copies or, if not amenable to copying, detailed descriptions or other appropriate embodiments, to the extent feasible, of all such intellectual property. Haisco and Licensee acknowledge and agree that “embodiments” of intellectual property within the meaning of Section 365(n) or comparable provisions of applicable bankruptcy or insolvency laws in another jurisdiction, include, without limitation, laboratory notebooks, prototypes, components, product samples and inventory, research studies and data, and Regulatory Approvals. If (i) a case under the Bankruptcy Code or comparable provisions of applicable bankruptcy or insolvency laws in another jurisdiction is commenced by or against Haisco, (ii) this Agreement is rejected as provided in the Bankruptcy Code or comparable provisions of applicable bankruptcy or insolvency laws in another jurisdiction, and (iii) Licensee elects to retain its rights hereunder as provided in Section 365(n) of the Bankruptcy Code or comparable provisions of applicable bankruptcy or insolvency laws in another jurisdiction, Haisco (in any capacity, including debtor-in-possession) and its successors and assigns (including a trustee) will: (a) provide to Licensee all such intellectual property (including all embodiments thereof) held by Haisco and such successors and assigns, or otherwise available to them, immediately upon Licensee’s written request. Whenever Haisco or any of its successors or assigns provides to Licensee any of the intellectual property licensed hereunder (or any embodiment thereof) pursuant to this Section 13.15.1(a), Licensee will have the right to perform Haisco’s obligations hereunder with respect to such intellectual property, but neither such provision nor such performance by Licensee will release Haisco from liability resulting from rejection of the license or the failure to perform such obligations; and (b) not interfere with Licensee’s rights under this Agreement, or any agreement supplemental hereto, to such intellectual property (including such embodiments), including any right to obtain such intellectual property (or such embodiments) from another entity to the extent provided in Section 365(n) of the Bankruptcy Code or comparable provisions of applicable bankruptcy or insolvency laws in another jurisdiction. |
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| 85 13.16.2 Both Parties will have the right to Exploit the Licensed Compounds and Licensed Products through, and subcontract performance of its obligations under this Agreement to, Affiliates and Third Parties (the “Subcontracted Activities”), subject to each Party’s agreement to ensure that all Subcontracted Activities are conducted in compliance with the applicable national and data security law of the United States, the United Kingdom, or countries and jurisdictions in Europe (the “National and Data Security Law”). Each Party will disclose to the other Party the identity of each Affiliate or Third Party contemplated for involvement in the disclosing Party’s Subcontracted Activity, and will further provide the non-disclosing Party with such additional information regarding such disclosed Affiliate or Third Party as the non-disclosing Party may reasonably request for the purpose of verifying compliance herewith. Should any Party determine upon the advice of external counsel that the other Party’s Affiliate’s or Third Party’s involvement in the other Party’s Subcontracted Activities is reasonably likely to result in (a) a violation of the National and Data Security Law, or (b) prohibitions, restrictions, or requirements under the National and Data Security Law that will materially adversely impact the Exploitation of any Licensed Compounds or Licensed Products in the Territory (if the other Party is Haisco) or the Haisco Territory (if the other Party is Licensee) or, if such first Party is Licensee, the business or fundraising prospects of Licensee or any of its Affiliates (such Person, a “Company of Concern”), such first Party will inform the other Party in writing of such determination (“Determination of Concern”). Upon the other Party’s receipt of a Determination of Concern, the Parties will promptly discuss together the basis of such determination (including sharing of documentary evidence in support and substantiation of such determination) and will reasonably consult in good faith with one another and their respective external counsel to assess whether and the specific extent to which the relevant Affiliate or Third Party constitutes a Company of Concern. Upon a mutual agreement that the relevant Affiliate or Third Party does constitute a Company of Concern, the other Party will immediately cease or terminate the applicable Company of Concern’s involvement in the relevant Subcontracted Activities. In the event the Parties do not reach an agreement with respect to whether the relevant Affiliate or Third Party constitutes a Company of Concern the matter should be elevated to the JSC; if the JSC does not agree on a determination, such first Party will have the unilateral right to require the other Party to cease or terminate the applicable Company of Concern’s involvement in the relevant Subcontracted Activities. 13.16.3 In the event a Party or any of its Affiliates is or becomes a Company of Concern pursuant to the Determination of Concern process set forth in Section 13.16.2, (a) the other Party’s obligation to exchange products, materials, data, or technical information under this Agreement, including at the JSC and through Alliance Managers, will immediately be suspended until, in the reasonable judgment of the other Party, such exchange can resume as contemplated under this Agreement in compliance with the National and Data Security Law, except with respect to such products, materials, data, or technical information that, in the reasonable judgment of the other Party, the other Party can exchange in a manner compliant with the National and Data Security Law; and (b) the JSC will immediately be disbanded, and the JSC will have no further obligations under this Agreement; provided, however, that the Parties may re-establish a new JSC after the disbandment of the former JSC if agreed by the Parties. After the disbandment of the JSC, the exchange of information between the Parties will be made through the Alliance Managers solely to the extent such exchange can occur in compliance with the National and Data Security Law in the reasonable judgment of the other Party, and all decisions of the JSC will be made pursuant to Sections 3.2.5, 3.2.6 and 3.2.7, subject to compliance with the National and Data Security Law. In the event a Party or any of its Affiliates is or becomes a Company of Concern pursuant to the Determination of Concern process set forth in Section 13.16.2, the Parties will discuss in good faith an arrangement to minimize the impact on the Exploitation of any Licensed Compounds or Licensed Products in the Territory (if such Party is Haisco) or the Haisco Territory (if such Party is Licensee). |
| 86 13.17 English Language. This Agreement will be written and executed in and all other communications under or in connection with this Agreement will be in, the English language. Any translation into any other language will not be an official version thereof and in the event of any conflict in interpretation between the English version and such translation, the English version will control. 13.18 Counterparts. This Agreement may be executed in two or more counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument. Counterparts may be delivered via electronic mail, including Adobe™ Portable Document Format (PDF) or any electronic signature complying with the U.S. Federal ESIGN Act of 2000, and any counterpart so delivered will be deemed to be original signatures, will be valid and binding upon the Parties, and, upon delivery, will constitute due execution of this Agreement. 13.19 Cooperation. In connection with any formal or informal inquiry, investigation or request for information from a Governmental Authority relating to the transactions contemplated by this Agreement pursuant to or in connection with antitrust or competition law, each Party will use commercially reasonable efforts to (a) respond promptly to any request for information and resolve as promptly as practicable any objections that may be asserted, (b) cooperate with each other, (c) promptly keep the other Party or its counsel informed regarding any such inquiry, investigation or request, and provide copies of any communication received from or given to the Governmental Authority, (d) consult with each other in advance of any meeting or telephone or video conference with the Governmental Authority and, to the extent not prohibited, give the other Party or its counsel the opportunity to attend and participate, and (e) permit the other Party or its counsel to review in advance, and in good faith consider the views of the other Party or its counsel concerning, any submission, filing or communication (and documents submitted therewith) intended to be given to such Governmental Authority. Each Party may (X) redact material required to be provided under this Section to remove references concerning valuation, (i) as necessary to comply with contractual arrangements, and (ii) as necessary to preserve attorney-client privilege and (Y) reasonably designate any competitively sensitive material to be provided to the other under this Section as outside counsel only which will be made available only to the outside counsel of the recipient. (The remainder of this page has been intentionally left blank. The signature page follows.) |
| IN WITNESS WHEREOF, the Parties have executed this Exclusive License Agreement as of the Execution Date. Haisco Pharmaceutical Group Co., Ltd. By: �Pt=----�t- (Y./V\ Name: Pangke Yan ___________ _ Title: CEO -- ----- ---- Nuvectis Pharma, Inc. By:--------------- Name: Ron Bentsur __________ _ Title: CEO _____ _____ _ _ [Signature Page to Exclusive License Agreement] |
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| Schedule 1.1.56 Schedule 1.1.56 Licensed Compound |
| Schedule 4.1 - 1 Schedule 4.1 Initial Knowledge Transfer and IND Enabling Materials Transfer |
| DATA TRANSFER SCHEDULE HSK39297 Data Transfer Items Item Content 1 Records of all regulatory correspondence with China NMPA 2 All available versions of the Investigators Brochure, in English in Word format. 3 IND/NDA Module 2 documents in English, in Word format. 4 All final, signed, in PDF format, English versions of nonclinical study reports as indicated in Table 2, together with SEND data in English for those nonclinical studies indicated in Table 2 as ‘YES’ in the ‘SEND data required’ column. 5 Certificates of translation for nonclinical final study reports translated into English, as indicated in Table 2 6 All reports (including all appendices), study plans, protocols, etc. submitted in the NDAs Module 5, in English, (+SDTM/ADaM data in English) |
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| Category Study Title Available in English Translation certificate GLP SEND data required Mutagenicity Test in Salmonella Typhimurium Yes Yes, CRO provided English report Yes No Chromosomal Aberration Study in Chinese Hamster Lung Fibroblast Yes Yes, CRO provided English report Yes No 26-Week Toxicity Study in SD Rats Yes Yes, CRO provided English report Yes Yes 39-Week Toxicity Study in Beagle Dog Yes Yes, CRO provided English report Yes Yes Fertility and Early Embryo Developmental Toxicity in SD Rats Yes Yes, CRO provided English report Yes No Embryo-Fetal Developmental Toxicity Study in SD Rats Yes Yes, CRO provided English report Yes Yes Embryo-Fetal Developmental Toxicity Study in Rabbits Yes Yes, CRO provided English report Yes Yes A Preliminary Embryo-fetal Developmental Toxicity Study of HSK39297 via Oral Gavage in Sprague Dawley Rats Yes Yes, CRO provided English report Yes Yes A Preliminary Embryo-fetal Developmental Toxicity Study of HSK39297 via Oral Gavage in New Zealand Rabbits Yes Yes, CRO provided English report Yes Yes Perinatal Toxicity Study of HSK39297 Administered by Oral Gavage to Sprague-Dawley Rats Yes Yes, CRO provided English report Yes No A 26-Week Intranasal Carcinogenicity Study in TG.RASH2 Mice Yes Yes, CRO provided English report Yes Yes Pharmacoki netics Pharmacokinetic Study Report-rat Yes Yes, CRO provided English report No No Pharmacokinetic Study Report-dog Yes Yes, CRO provided English report No No Study Report of Tissue Distribution-rat Yes Yes, CRO provided English report No No Plasma Protein Binding Rate Study Report Yes Yes, CRO provided English report No No Blood to Plasma Ratio Study Report Yes Yes, CRO provided English report No No Study Report of Metabolic Stability Yes Yes, CRO provided English report No No |
| Category Study Title Available in English Translation certificate GLP SEND data required Study Report of Excretion in Rats Yes Yes, CRO provided English report No No CYP Inhibition Study Report Yes Yes, CRO provided English report No No CYP Induction Study Report Yes Yes, CRO provided English report No No CAPGPS Study Report Yes Yes, CRO provided English report No No MDPGPI Study Report Yes Yes, CRO provided English report No No BCRPS Study Report Yes Yes, CRO provided English report No No BCRPI Study Report Yes Yes, CRO provided English report No No Transport Uptake Study Report Yes Yes, CRO provided English report No No Transport Inhibition Study Report Yes Yes, CRO provided English report No No Metabolism study of HSK39297 in Rats and Dogs Yes Yes, CRO provided English report No No Metabolic Profiles of HSK39297 in Hepatocytes Yes Yes, CRO provided English report No No In Vitro Study on the Phenotypic Identification and Metabolic Contribution of Oxidative Enzymes in the Metabolism of HSK39297 Yes Yes, CRO provided English report No No Study Report for Tissue Distribution of [14C]HSK39297 in LE Rats Yes Yes, CRO provided English report No No Study Report of [14C]HSK39297 Pharmacokinetics in vivo in SD Rats Yes Yes, CRO provided English report No No Metabolic Profiles of [14C]HSK39297 in Sprague-Dawley Rats Following Oral Administration Yes Yes, CRO provided English report No No Study Report of [14C]HSK39297 Excretion in SD Rats Yes Yes, CRO provided English report No No Study Report of Radiation Dose Estimation after Oral Yes Yes, CRO provided English report No No |
| Category Study Title Available in English Translation certificate GLP SEND data required Administration of [14C]HSK39297 to Subjects_final Identification of the CYP Enzymes that Participate in the Metabolism of HSK39297 Yes Yes, CRO provided English report No No Identification of the UGT Enzymes that Participate in the Metabolism of HSK39297 Yes Yes, CRO provided English report No No |
| DATA TRANSFER SCHEDULE HSK42360 Table 2: Data Transfer Items Item Content 1 Records of all regulatory correspondence with China NMPA 2 All available versions of the Investigators Brochure, in English in Word format. 3 IND Module 2 documents in English, in Word format. 4 All final, signed, in PDF format, English versions of nonclinical study reports (+SEND data in English, where SEND data are applicable) as indicated in Table 2. When SEND data are not available, source study data should be provided as generated by the CRO 5 Certificates of translation for nonclinical final study reports translated into English, as indicated in Table 2 6 All available clinical trial protocols (corporate and IST), in English in Word format 7 All available clinical study reports, when available, full or abbreviated (+SDTM/ADaM in Engligh, when available) 8 All posters/oral presentations of clinical data 9 All clinical PK and/or PD reports or summaries 10 Method validation reports of clinical PK (+PD if available) |
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| Section Report Number Report Name 4. Pharmacokinetics Comparison of HSK42360 and HSK42360-Na in Beagle Dogs Following Intragastric Administration Distribution 1. RP-HSK42360-ADME-RTD 2. RP-HSK42360-ADME-PPB 3. RP-HSK42360-ADME-B/P 4. RP-HSK42360-2025-RTD 1. Tissue Distribution Evaluation of HSK42360 in Sprague Dawley Rats Following Intragastric Administration 2. Plasma Protein Binding Rates Study of HSK42360 in ICR Mouse, SD Rat, Beagle Dog, Cynomolgus Monkey and Human Plasma 3. Blood to Plasma Ratio of HSK42360 in Human, Cynomolgus Monkey, Beagle dog, SD Rat and ICR Mouse plasma 4. Tissue Distribution Evaluation of HSK42360 in Sprague Dawley Rats Following Intragastric Administration of HSK42360-Na Metabolism 1. RP-HSK42360-ADME-MS 2. RP-HSK42360-ADME-HP 3. RP-HSK42360-ADME-MetID 4. RP-HSK42360-ADME-EP 5. RP-HSK42360-ADME-DDI-EI 6. RP-HSK42360-ADME-DDI-TDI 7. HSK42360-ADME-DDI-EID 1. Metabolic Stability Evaluation of HSK42360 in Liver Microsomes 2. Metabolic Profiles of HSK42360 in Hepatocytes_Species Differences in HSK42360 Metabolism 3. Metabolic Profiles of HSK42360 in Sprague-Dawley Rats and Dogs Following Oral Administration 4. In Vitro Metabolic Profiles in Human Liver Microsomes and CYP450 Phenotyping of HSK42360 5. Evaluation of HSK42360 for CYP450 In-vitro Inhibition Potential 6. Evaluation of HSK42360 for CYP450 In-vitro Time dependent Inhibition Potential 7. Report on the Induction of CYP1A2, CYP2B6 and CYP3A4 by HSK42360 Excretion 1. RP-HSK42360-ADME-RE 1. Excretion of HSK42360 in Sprague-Dawley Rats Following Intragastric Administration Pharmacokinetic drug interactions 1. RP-HSK42360-ADME-Caco-2 2. RP-HSK42360-ADME-DDI-ETP 3. RP-HSK42360-ADME-DDI-UTP 1. The permeability of HSK42360 on Caco-2 cell model 2. The Potential Effects of HSK42360 on Efflux Transporters of P-gp and BCRP 3. Evaluating the Potential of HSK42360 as a Substrate and Inhibitor of Uptake Transporters Single dose toxicity [Species and route] 1. R23-S350-SD 2. D23-S350-SD 1. A Single Dose Toxicity Study of HSK42360 Administered by Oral Gavage to Sprague-Dawley Rats (+SEND) 2. A Single Dose Toxicity Study of HSK42360 Administered by Oral Gavage to Beagle Dogs (+SEND) Repeat dose toxicity [Species, route, duration] 1. R23-S350-RD 2. D23-S350-RD 1. A 4-Week Toxicity Study of HSK42360 by Oral Gavage to Sprague-Dawley Rats with a 4-Week Recovery Period 2. A 4-Week Toxicity Study of HSK42360 by Oral Gavage to Beagle Dogs with a 4-Week Recovery Period In Vitro 1. O23-S350-AM 2. O23-S350-CA 1. A Mutagenicity Test of HSK42360 in Salmonella Typhimurium 2. Chromosomal Aberration Study of HSK42360 in Chinese Hamster Lung Fibroblast In Vivo 1. M23-S350-MN 1. Micronucleus Study of HSK42360 in Bone Marrow Polychromatic Erythrocytes of CD-1 Mice by Oral Gavage |
| Schedule 4.2 - 1 Schedule 4.2 Manufacturing Technology Transfer |
| Schedule 4.2 - 2 DATA TRANSFER SCHEDULE HSK39297 1 IND/NDA Module 3 DS and DP documents in English, in Word format 2 CMC data and reports generated by Haisco supporting module 3 sections (for example: batch records, CoAs, campaign reports for all GMP and non-GMP batches, polymorph and salt screening report, API Structure elucidation/ characterization report and all other reports) |
| Schedule 4.2 - 3 DATA TRANSFER SCHEDULE HSK42360 1 Module 3 DS and DP documents in English, in Word format, for both the free base and NA+ forms 2 CMC data and reports generated by Haisco (for example: batch records, CoAs, campaign reports for all GMP and non-GMP batches, polymorph and salt screening report, API Structure elucidation/ characterization report and all other reports) |
| Schedule 5.3.3 Schedule 5.3.3 Licensee Territory Development Plan [***] [***] |
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| Schedule 8.4 - 1 Schedule 8.4 Press Release Haisco Enters into Exclusive License Agreement with Nuvectis for Two Drug Candidates in Oncology and Complement Indications On June 22, 2026, Haisco Pharmaceutical Group Co., Ltd. (Ticker Code: 002653) announced that it has entered into an exclusive licensing agreement with Nuvectis (NASDAQ: NVCT), a U.S. biotechnology company. Under the agreement, Haisco has granted Nuvectis the exclusive rights to develop, manufacture, and commercialize its independently developed innovative drug HSK42360 worldwide, excluding Greater China, as well as its independently developed innovative drug HSK39297 worldwide, excluding Greater China, India, and certain Southeast Asia territories. HSK42360 is a best-in-class BRAF paradoxical breaker inhibitor designed to overcome acquired resistance to current BRAF inhibitors. It demonstrates strong potential in primary brain tumors and brain metastases and is currently being evaluated in a Phase I clinical trial in China.HSK39297 is a best-in-class potential once-daily (QD) CFB inhibitor, two NDA applications for PNH have been submitted in China, while several additional indications are advancing through Phase 2 and Phase 3 clinical development in China. “This collaboration is highly aligned with our global development strategy and is expected to generate sustainable value and long-term returns,” said Dr. Pangke Yan, Chief Executive Officer of Haisco. “By partnering with a U.S. biotechnology company such as Nuvectis, Haisco aims to accelerate the global development of innovative oncology and complement therapies and bring high-quality treatment options to patients worldwide.” The collaboration strengthens Haisco’s global presence and enhances the value of its pipeline by leveraging Nuvectis’ proven research and development capabilities, extensive industry experience, and established track record in oncology and kidney diseases. Under the terms of the agreement, Haisco will receive an upfront and near-term payments of USD $40 million and is eligible to receive up to USD $1.421 billion in additional development, regulatory, and commercial milestone payments, as well as tiered royalties on future net sales. The first four milestones may be payable by Licensee in cash and/or common stock, provided that the equity consideration shall represent less than 40% of the total milestone value. If the Licensee sublicenses all or part of the rights to a third party, or if a Change of Control occurs during the restricted period, Haisco shall be entitled to share in the corresponding sublicense income and Change-of-Control payments. In addition, the effectiveness of the agreement is subject to certain financing conditions which Nuvectis is required to meet to ensure sufficient capital for the development of the licensed products. About Haisco As a benchmark enterprise in China’s innovative pharmaceutical sector, Haisco adheres to a core strategy of “innovation-driven growth and global expansion.” The company has established a diversified R&D pipeline encompassing small-molecule innovative drugs, biologics, and high-end generics. Haisco is actively advancing more than 50 R&D programs across key therapeutic areas including pain management, oncology, respiratory diseases, autoimmune disorders, metabolic diseases, and central nervous system disorders; notably, over 10 of these programs have entered pivotal clinical stages. The company has maintained a strong commitment to R&D, with investment |
| exceeding 15% of revenue in each of the past three years. It has established major R&D centers in Chengdu, Shanghai, and Silicon Valley, supported by a research team with extensive global experience, forming an integrated innovation system combining in-house capabilities and external collaboration. As early as 2015, Haisco initiated its global strategy and has since actively expanded into international markets through multiple approaches, including license-out transactions, co-development partnerships, and overseas mergers and acquisitions. Looking ahead, Haisco will continue to focus on areas of unmet medical need, strengthen its capabilities in independent innovation and global collaboration, and strive to deliver high-quality, China-originated innovative medicines to patients around the world. |
| Schedule 12.3 Baseball Arbitration 1. In the event that the Parties fail to reach agreement with respect to the royalty rates under Section 12.3.3(f) within thirty (30) days after Haisco’s written request to negotiate such royalty rates, then either Party will have the right, by written notice to the other Party within fifteen (15) days of the end of such thirty (30)-day period, as applicable, to initiate the procedures described in this Schedule 12.3 to finalize such royalty rates through binding arbitration as follows: (a) Within fifteen (15) days of such written notice, each Party will (i) prepare drafts of the proposed royalty rates to be used in such arbitration proceeding (each, an “Arbitration Draft” and collectively, the “Arbitration Drafts”) and (ii) submit its respective Arbitration Draft to the other Party, along with, should a Party desire, an explanation/justification of the same not to exceed twenty-five (25) pages, and the Parties will, within fifteen (15) days after exchanging the Arbitration Drafts, endeavor to meet to determine whether they agree to either Party’s Arbitration Draft or modified versions thereof. (b) If the Parties do not agree within forty-five (45) days after the Parties exchange the Arbitration Drafts pursuant to the foregoing clause (a), then the Parties will mutually select an impartial and independent professional in business or licensing experienced in biopharmaceutical products with at least fifteen (15) years of experience in the pharmaceutical and life sciences industries who (i) has not worked for, consulted with, or been engaged by either Party or its Affiliates in the seven (7)-year period immediately prior to selection of such individual, and (ii) does not own equity or debt in either Party or its Affiliates (other than equity or debt owned through a broad based mutual fund or exchange trade fund) (the “Arbitrator”), which Arbitrator will be appointed within thirty (30) days after the end of such 45-day period. If the Parties are unable to agree on an Arbitrator within this time period, then the Parties will request that the ICC appoint the Arbitrator (and the Parties will equally share the costs of ICC for performing such services). (c) Promptly following the appointment of the Arbitrator (and in any event within fifteen (15) days of such appointment), each Party will submit its respective Arbitration Draft (and explanation/justification, if any) to the Arbitrator; each Party’s Arbitration Draft and explanation/justification may be updated as a Party may elect from the first version shared with the other Party. Within sixty (60) days following the receipt of the latter of such Arbitration Drafts, the Arbitrator will render an award that selects one of the Arbitration Drafts; provided that, for clarity, the Arbitrator will be limited to selecting only one or the other of the Arbitration Drafts that most closely reflects the calculation of the amounts payable to Haisco in accordance with this Schedule 12.3 or the Arbitrator’s determination of fair market value royalty rates, as applicable. The Arbitrator may request an extension to such 60-day deadline, and further may require that the Parties provide additional information as the Arbitrator may reasonably request. The determination of the Arbitrator as to the selection of one Party’s Arbitration Draft will be binding and conclusive upon both Parties, and the selected Arbitration Draft will be deemed the royalty rates and the Parties will perform in accordance with the royalty rates, as applicable. Judgment on the |
| award may be entered in any competent jurisdiction. The seat of arbitration will be San Francisco, California. (d) The (i) fees and expenses of the Arbitrator and (ii) costs and expenses of the arbitration, including reasonable attorneys’ fees and other costs of legal representation, will be paid by the Party whose Arbitration Draft was not selected by the Arbitrator. The Arbitration will fix the costs and expenses of the arbitration in the award. (e) The Parties agree not to disclose to any Third Party (other than to the Arbitrator, their respective counsel and other advisors) any portion of any Arbitration Draft submitted by another Party in the course of such proceedings. |
| Schedule 10.2 Schedule 10.2 Disclosure Schedule All capitalized terms used but not defined in this Schedule 10.2 (this “Disclosure Schedule”) shall have the meanings as defined in the Agreement, unless otherwise provided. The section numbers below correspond to the section numbers of the representations and warranties in the Agreement; provided, however, that any information disclosed herein under any section number shall be deemed to be disclosed and incorporated into any other section number under the Agreement where such disclosure would be appropriate and such appropriateness is reasonably apparent from the face of such disclosure. |
| Schedule 10.2.5 - 1 Schedule 10.2.5 Licensed Patents |
| Schedule 10.2.5 - 2 HSK42360 PATENT LIST Category Haisco Code Applicant Status Title Application Number Patent Number Grant Publication Date Compound ND451-PCT Xizang Haisco Pharmaceutical Co., Ltd. PCT designated time limit expired Preparation and use of quinazolinone derivative as kinase inhibitor PCT/CN2023/108142 ND451-PCT-AU Haisco Pharmaceutical Group Co., Ltd. Pending AU2023309169 ND451-PCT-BR Haisco Pharmaceutical Group Co., Ltd. Pending BR112025000910 ND451-PCT-CA Haisco Pharmaceutical Group Co., Ltd. Pending CA3262493 ND451-PCT-CN Haisco Pharmaceutical Group Co., Ltd. Pending CN202380054551.3 ND451-PCT-EA Haisco Pharmaceutical Group Co., Ltd. Granted Patent EA202590446 EA052119 1/14/2026 ND451-PCT-EP Haisco Pharmaceutical Group Co., Ltd. Pending EP2023842356 ND451-PCT-HK Haisco Pharmaceutical Group Co., Ltd. Pending HK62025105734 ND451-PCT-ID Haisco Pharmaceutical Group Co., Ltd. Pending IDP00202501427 ND451-PCT-IL Haisco Pharmaceutical Group Co., Ltd. Pending IL318464 ND451-PCT-IN Haisco Pharmaceutical Group Co., Ltd. Pending IN202517011795 ND451-PCT-JP Haisco Pharmaceutical Group Co., Ltd. Pending JP2025503063 ND451-PCT-KR Haisco Pharmaceutical Group Co., Ltd. Pending KR1020257005501 ND451-PCT-MX Haisco Pharmaceutical Group Co., Ltd. Pending MX2025/000744 ND451-PCT-MY Haisco Pharmaceutical Group Co., Ltd. Pending MYPI2025000494 ND451-PCT-NZ Haisco Pharmaceutical Group Co., Ltd. Pending NZ818112 ND451-PCT-SG Haisco Pharmaceutical Group Co., Ltd. Pending SG11202500372T ND451-TW Xizang Haisco Pharmaceutical Co., Ltd. Pending TW112126463 ND451-PCT-US Haisco Pharmaceutical Group Co., Ltd. Pending US18/996603 ND451-PCT-ZA Haisco Pharmaceutical Group Co., Ltd. Granted Patent ZA202501471 ZA20250147 1B 10/29/2025 Composition ND628-PCT Haisco Pharmaceutical Group Co., Ltd. National Phase (within the designated time limit) Pharmaceutical composition comprising braf inhibitor and use of pharmaceutical composition in medicine PCT/CN2025/072990 ND628-TW Pending TW114101941 Method of Preparation ND733-PCT Haisco Pharmaceutical Group Co., Ltd. National Phase (within the designated time limit) Preparation method for BRAF inhibitor PCT/CN2025/078401 |
| Schedule 10.2.5 - 3 ND733-TW Pending TW114106374 Crystaline ND741-PCT Haisco Pharmaceutical Group Co., Ltd. National Phase (within the designated time limit) Crystal form of quinazolinone derivative, preparation method therefor and use thereof PCT/CN2025/077968 ND741-TW Pending TW114105982 Formulation ND916-Y1 Haisco Pharmaceutical Group Co., Ltd. abandonment A Pharmaceutical Composition Containing a BRAF Inhibitor CN202510135904.3 ND916-Y2 Priority CN2025109833381 ND916-Y3 CN2026102034005 Salt Froms ND1038-Y1 Haisco Pharmaceutical Group Co., Ltd. Priority Salt Forms and Crystal Forms of a Compound, and Applications Thereof in Pharmacy CN2025110801466 ND1038-Y2 CN2026104179795 Salt Froms ND1040-Y1 Haisco Pharmaceutical Group Co., Ltd. Priority Polymorphs of a Compound, Preparation Methods and Applications Thereof CN2025110800798 Method of Preparation(salt ) ND1033-Y1 Haisco Pharmaceutical Group Co., Ltd. abandonment / / Combination ND1215-Y1 Haisco Pharmaceutical Group Co., Ltd. Priority Antitumor Use of BRAF Inhibitors CN202610477514.9 |
| Schedule 10.2.5 - 4 HSK39297 PATENT LIST Category Haisco Code Applicant Status Title Application Number Patent Number Grant Publication Date Compound ND356-PCT Xizang Haisco Pharmaceutical Co., Ltd. National Phase Benzo nitrogen-containing heteroaromatic ring derivative and use thereof in medicine PCT/CN2022/113216 ND356-PCT-CN Haisco Pharmaceutical Group Co., Ltd. pending CN202280055829.4 ND356-PCT-HK Xizang Haisco Pharmaceutical Co., Ltd. pending HK62024091991 ND356-TW Xizang Haisco Pharmaceutical Co., Ltd. pending TW111131199 ND356-PCT-EP Xizang Haisco Pharmaceutical Co., Ltd. pending EP2022857877 ND356-PCT-US Xizang Haisco Pharmaceutical Co., Ltd. pending US18/684549 ND356-续案 1- PCT-US Xizang Haisco Pharmaceutical Co., Ltd. granted US19/352,045 US12595270B2 4/7/2026 ND356-PCT-JP Xizang Haisco Pharmaceutical Co., Ltd. pending JP2024510237 ND356-PCT-KR Xizang Haisco Pharmaceutical Co., Ltd. pending KR1020247006312 ND356-分案 1- PCT-EP Xizang Haisco Pharmaceutical Co., Ltd. pending EP25205586.8 ND356-PCT-AU Xizang Haisco Pharmaceutical Co., Ltd. pending AU2022329230 ND356-PCT-BR Xizang Haisco Pharmaceutical Co., Ltd. pending BR112024002722 ND356-PCT-CA Xizang Haisco Pharmaceutical Co., Ltd. pending CA3229360 ND356-PCT-EA Xizang Haisco Pharmaceutical Co., Ltd. granted EA202490196 ZA202401550B 10/30/2024 ND356-PCT-ID Xizang Haisco Pharmaceutical Co., Ltd. pending IDP00202402171 ND356-PCT-IL Xizang Haisco Pharmaceutical Co., Ltd. pending IL310682 ND356-PCT-IN Xizang Haisco Pharmaceutical Co., Ltd. pending IN202417016088 ND356-PCT-MX Xizang Haisco Pharmaceutical Co., Ltd. pending MX2024001924 ND356-PCT-MY Xizang Haisco Pharmaceutical Co., Ltd. pending MYPI2024000917 ND356-PCT-NZ Xizang Haisco Pharmaceutical Co., Ltd. pending NZ808176 ND356-PCT-SG Xizang Haisco Pharmaceutical Co., Ltd. pending SG11202400981Q ND356-PCT-ZA Xizang Haisco Pharmaceutical Co., Ltd. granted ZA202401550 EA051911 12/19/2025 Process ND529-PCT Haisco Pharmaceutical Group Co., Ltd. pending Method for preparing deuterated methoxyindole compound and intermediate thereof PCT/CN2025/132910 Salt and Crystal Form ND531-PCT Haisco Pharmaceutical Group Co., Ltd. National Phase Salt and crystalline forms of a benzo-aza heteroaromatic derivative and their PCT/CN2024/076765 ND531-PCT-CN Haisco Pharmaceutical Group Co., Ltd. pending CN202480012974.3 ND531-TW Xizang Haisco Pharmaceutical Co., Ltd. pending TW113104870 |
| Schedule 10.2.5 - 5 ND531-PCT-EP Haisco Pharmaceutical Group Co., Ltd. pending pharmaceutical applications EP24756269.7 ND531-PCT-US Haisco Pharmaceutical Group Co., Ltd. pending US19/157,217 ND531-PCT-JP Haisco Pharmaceutical Group Co., Ltd. pending JP2025-547520 ND531-PCT-KR Haisco Pharmaceutical Group Co., Ltd. pending KR10-2025-7028501 ND531-PCT-AU Haisco Pharmaceutical Group Co., Ltd. pending AU2024221845 ND531-PCT-BR Haisco Pharmaceutical Group Co., Ltd. pending BR1120250172603 ND531-PCT-CA Haisco Pharmaceutical Group Co., Ltd. pending CA3282971 ND531-PCT-ID Haisco Pharmaceutical Group Co., Ltd. pending IDP00202507816 ND531-PCT-IN Haisco Pharmaceutical Group Co., Ltd. pending IN202517079693 ND531-PCT-MX Haisco Pharmaceutical Group Co., Ltd. pending MX/a/2025/009605 ND531-PCT-MY Haisco Pharmaceutical Group Co., Ltd. pending PI2025004946 ND531-PCT-SG Haisco Pharmaceutical Group Co., Ltd. pending SG11202505491R Formulation ND535-PCT Haisco Pharmaceutical Group Co., Ltd. National Phase Pharmaceutical composition of a benzo-aza heteroaromatic ring derivative and its use in medicine PCT/CN2024/077932 ND535-PCT-CN Haisco Pharmaceutical Group Co., Ltd. pending CN202480014041.8 ND535-TW Xizang Haisco Pharmaceutical Co., Ltd. pending TW113106053 ND535-PCT-EP Haisco Pharmaceutical Group Co., Ltd. pending EP24759705.7 ND535-PCT-US Haisco Pharmaceutical Group Co., Ltd. pending US19/158757 ND535-PCT-JP Haisco Pharmaceutical Group Co., Ltd. pending JP2025549333 ND535-PCT-KR Haisco Pharmaceutical Group Co., Ltd. pending KR1020257029312 ND535-PCT-AU Haisco Pharmaceutical Group Co., Ltd. pending AU2024226460 ND535-PCT-BR Haisco Pharmaceutical Group Co., Ltd. pending BR1120250176811 ND535-PCT-CA Haisco Pharmaceutical Group Co., Ltd. pending CA3283594 ND535-PCT-ID Haisco Pharmaceutical Group Co., Ltd. pending IDP00202508025 ND535-PCT-IN Haisco Pharmaceutical Group Co., Ltd. pending IN202517079903 ND535-PCT-MX Haisco Pharmaceutical Group Co., Ltd. pending MX/a/2025/009791 ND535-PCT-MY Haisco Pharmaceutical Group Co., Ltd. pending MYPI2025005072 ND535-PCT-SG Haisco Pharmaceutical Group Co., Ltd. pending SG11202505640T Use ND674-PCT Xizang Haisco Pharmaceutical Co., Ltd. National Phase Use of a benzo-aza aromatic ring derivative in the treatment of diseases mediated by complement factor B PCT/CN2024/137049 ND674-TW Xizang Haisco Pharmaceutical Co., Ltd. pending TW113147271 ND674-PCT-ZA Xizang Haisco Pharmaceutical Co., Ltd. pending ZA2026/05745 ND674-PCT-US Xizang Haisco Pharmaceutical Co., Ltd. pending / ND674-PCT-SG Xizang Haisco Pharmaceutical Co., Ltd. pending SG11202603625Y ND674-PCT-NZ Xizang Haisco Pharmaceutical Co., Ltd. pending NZ833567 |
| Schedule 10.2.5 - 6 ND674-PCT-MY Xizang Haisco Pharmaceutical Co., Ltd. pending / ND674-PCT-MX Xizang Haisco Pharmaceutical Co., Ltd. pending MX/a/2026/006780 ND674-PCT-KR Xizang Haisco Pharmaceutical Co., Ltd. pending / ND674-PCT-JP Xizang Haisco Pharmaceutical Co., Ltd. pending IDP00202606045 ND674-PCT-IN Xizang Haisco Pharmaceutical Co., Ltd. pending / ND674-PCT-IL Xizang Haisco Pharmaceutical Co., Ltd. pending / ND674-PCT-ID Xizang Haisco Pharmaceutical Co., Ltd. pending / ND674-PCT-HK Xizang Haisco Pharmaceutical Co., Ltd. pending / ND674-PCT-EP Xizang Haisco Pharmaceutical Co., Ltd. pending / ND674-PCT-EA Xizang Haisco Pharmaceutical Co., Ltd. pending / ND674-PCT-CN Xizang Haisco Pharmaceutical Co., Ltd. pending / ND674-PCT-CA Xizang Haisco Pharmaceutical Co., Ltd. pending CA3313441 ND674-PCT-BR Xizang Haisco Pharmaceutical Co., Ltd. pending BR1120260136901 ND674-PCT-AU Xizang Haisco Pharmaceutical Co., Ltd. pending / Process ND683-PCT Haisco Pharmaceutical Group Co., Ltd. International Phase A method for preparing a phenylpiperidine derivative PCT/CN2024/142580 ND683-TW Haisco Pharmaceutical Group Co., Ltd. pending TW113150902 Formulation ND933-PCT Haisco Pharmaceutical Group Co., Ltd. pending A Pharmaceutical Composition of Complement Factor B Inhibitor and Its Application PCT/CN2026/092454 ND933-TW Haisco Pharmaceutical Group Co., Ltd. pending TW115115821 Use ND978-PCT Haisco Pharmaceutical Group Co., Ltd. pending Therapeutic Use of Benzodiazaborine Derivatives for Complement Factor B-Mediated Diseases PCT/CN2026/099585 ND978-TW Haisco Pharmaceutical Group Co., Ltd. pending TW115120733 Combination ND1137-Y1 Haisco Pharmaceutical Group Co., Ltd. priority A Deuterated Compound and Its Drug Combination CN202610026787.1 Formulation ND1201-Y1 Haisco Pharmaceutical Group Co., Ltd. priority A Compound Pharmaceutical Composition and Its Medicinal Application CN2026106546394 Combination ND1216-Y1 Haisco Pharmaceutical Group Co., Ltd. priority Use of Benzoaza-Aromatic Ring Derivatives in the Treatment of Complement Factor B-Mediated Diseases CN202610641362.1 |
| Schedule 10.2.5 - 7 |
Exhibit 31.1
CERTIFICATION PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Ron Bentsur, certify that:
| 1. | I have reviewed this Quarterly Report on Form 10-Q for the quarter ended September 30, 2026 of Nuvectis Pharma, Inc. (the registrant); |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects, the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
| 4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
| (a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| (b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| (c) | evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| (d) | disclosed in the report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| (a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
| (b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
| | /s/ Ron Bentsur |
| | Ron Bentsur |
| | Chairman, Chief Executive Officer, and President |
| | (Principal Executive Officer) |
| | November 4, 2026 |
| | |
Exhibit 31.2
CERTIFICATION PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Michael J Carson, certify that:
| 1. | I have reviewed this Quarterly Report on Form 10-Q for the quarter ended September 30, 2026 of Nuvectis Pharma, Inc. (the registrant); |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects, the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
| 4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
| (a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| (b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| (c) | evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| (d) | disclosed in the report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| (a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
| (b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
| | /s/ Michael J. Carson |
| | Michael J. Carson |
| | Vice President of Finance |
| | (Principal Financial Officer) |
| | November 4, 2026 |
| | |
Exhibit 32.1
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report on Form 10-Q of Nuvectis Pharma, Inc. (the “Company”) for the period ended September 30, 2026, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Ron Bentsur, President and Chief Executive Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:
| (1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
| (2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of, and for, the periods presented in the Report. |
| | /s/ Ron Bentsur |
| | Ron Bentsur |
| | Chairman, Chief Executive Officer, and President |
| | (Principal Executive Officer) |
| | November 4, 2026 |
Exhibit 32.2
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report on Form 10-Q of Nuvectis Pharma, Inc. (the “Company”) for the period ended September 30, 2026, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Michael J Carson, Principal Financial Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:
| (1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
| (2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company, as of, and for, the periods presented in the Report. |
| | /s/ Michael J. Carson |
| | Michael J. Carson |
| | Vice President of Finance |
| | (Principal Financial Officer) |
| | November 4, 2026 |
| | |