Provision Language
Section C: CARB-X Special Terms and Conditions
Article V. Stewardship and Access plus Additional Obligations
5.01 Access, Not Excess
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(f) Obligations Follow the Product:
(i) If control of the Portfolio Company Project IP Rights resulting from the Project changes, whether through sale, transfer, license, assignment or otherwise, the Portfolio Company will require the obligations of Sections 5.01, 5.03 and 6.04 to follow the Product and be incorporated into any such sale, transfer, license, assignment or otherwise to the new company (the “Acquirer”). Prompt notice will be provided by the Portfolio Company to Managing Entity of any such event. If the Acquirer accepts obligations under Sections 5.01, 5.03 and 6.04, the Portfolio Company is discharged from further obligations from Sections 5.01, 5.03 and 6.04.
(ii) If the Portfolio Company fails to provide the Stewardship and Access Plan as provided in Section 5.01, within ninety (90) days, Managing Entity can demand the same in writing within sixty (60 days).
(iii) The obligations of this Section 5.01 survive the termination or expiry of this Agreement and shall continue in force until the expiration of the last patent or exclusivity periods in the United States, the European Union, the United Kingdom or Japan for any Project IP Rights (the “Project IP Expiration”).
(g) If Managing Entity informs the Portfolio Company that it is no longer receiving CARB-X funding and no longer operates CARB-X, then Wellcome Trust will assume the rights reserved to Managing Entity in this Section 5.01, and, for purposes of this Section 5.01, the Wellcome Trust is an intended third-party beneficiary of this Agreement, and is entitled to enforce its rights as described in this Section 5.01 as if it were a party hereto.
5.03 Research and Development Standards and Development Diligence
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(b) Development Diligence. Portfolio Company will use commercially reasonable efforts to develop and seek regulatory approval for at least one Product in at least one indication by the FDA, EMA (or national authorities), MHRA or Japan’s PMDA. If the Wellcome Trust considers, based on scientific evidence and data, that any Project IP Rights remain not further developed by the Portfolio Company, its assignee or its licensee after the five (5) years following the end of the Term, then the Portfolio Company, its assignee or its exclusive licensee shall, with respect to such Project IP Rights, be subject to the Access Rights under Section 6.05. If Portfolio Company is engaged in scientific and technical development leading towards regulatory approval for at least one Product in at least one indication by the FDA, EMA (or national authorities), MHRA or Japan’s PMDA, then Wellcome Trust shall not deem the Project IP Rights to remain not further developed. For purposes of this Section 5.03, the Wellcome Trust is an intended third-party beneficiary of this Agreement and is entitled to enforce the Access Rights as described in this Section 5.03 as if it were a party hereto. Section 5.03 shall survive termination or expiry of the Agreement and shall continue in force for a period of 10 years.
6. Intellectual Property
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6.04 Project IP Rights and Strategy. All rights are subject in all cases to the provisions of Section B, Articles 15, 18 and 19, applicable Federal laws and regulations governing patents and inventions, including government-wide regulations at 37 CFR part 401 and, in particular, and without limitation, to U.S. Government march-in rights set forth in 37 CFR Sect. 401.6 and 401.14 (j) (collectively, the “U.S. Government Bayh-Dole Rights”). Applicable U.S. laws and regulations are not superseded or limited by any additional special terms or conditions imposed on the Portfolio Company regarding IP. The process set out in this Section is intended to design and implement a credible IP strategy that enables the development and deployment of the Product in a manner consistent with the Wellcome Trust’s equitable access principles.
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(c) Access Rights. Should the Wellcome Trust and the Portfolio Company with respect to any Other Territory attempt but fail to agree on a mechanism and business plan as described in Section 6.04(b) by the third anniversary of the First Approval, then the Portfolio Company shall, with respect to Project IP Rights, be subject to Access Rights for the sole purpose of making the Product available in such Other Territory.
(d) For purposes of this Section 6.04, the Wellcome Trust is an intended third-party beneficiary of this Agreement, and is entitled to enforce the Access Rights as described in this section 6.04 as if it were a party hereto.
(e) Section 6.04 shall survive termination or expiry of this Agreement and shall continue in force until the Project IP Expiration.
6.05 Access Rights
(a) The Portfolio Company agrees that with respect to any Project IP Rights in which it has acquired title, the Wellcome Trust has the right in accordance with the procedures in Subsection (b) below, to require the Portfolio Company, an assignee or exclusive licensee of Project IP Rights to grant a nonexclusive, partially exclusive, or exclusive license in any field of use to a responsible applicant or applicants, upon terms and in timescales that are reasonable under the circumstances, for the sole purpose of making the Product available in Other Territories if Access Rights are exercised pursuant to Section 6.04(c), or for further development in the field of infectious diseases if Access Rights are exercised pursuant to 5.03(b). The exercise of Access Rights shall be predicated on the Wellcome Trust’s determination that:
(i) Such action is necessary because the Portfolio Company, licensee or assignee has not taken, or is not expected to take within a reasonable time, effective steps to achieve Practical Application of the Project IP Rights in such field of use;
(ii) Such action is necessary to alleviate health or safety needs which are not reasonably satisfied by the Portfolio Company, assignee or their licensees; or
(iii) Such action is necessary to meet requirements for the Wellcome Trust’s charitable purpose and such requirements are not reasonably satisfied by the Portfolio Company, assignee or licensees.
(b) Exercise of Access Rights.
(i) The following procedures shall govern the exercise of Access Rights.
(ii) Whenever the Wellcome Trust receives information that it believes might warrant the exercise of Access Rights, before initiating any proceeding to exercise Access Rights, it shall notify the Portfolio Company, its assignee or exclusive licensee, as applicable, in writing of the information and request informal written or oral comments from the Portfolio Company, its assignee or exclusive licensee as well as information relevant to the matter. In the absence of any comments from the Portfolio Company within 30 days, the Wellcome Trust may, at its discretion, proceed with the procedures below. If a comment is received within 30 days, or later if the Wellcome Trust has not initiated the procedures below, then the Wellcome Trust shall, within 60 days after it receives the comment, either initiate the procedures below or notify the Portfolio Company, its assignee or exclusive licensee, in writing, that it will not pursue Access Rights based on the available information.
(iii) A proceeding to exercise Access Rights shall be initiated by the issuance of a written notice by the Wellcome Trust to the Portfolio Company and its assignee or exclusive licensee, as applicable and if known to the Wellcome Trust, stating that the Wellcome Trust is considering the exercise of Access Rights. The notice shall state the reasons for the proposed exercise of Access Rights in terms sufficient to put the Portfolio Company on notice of the facts upon which the action would be based and shall specify the field or fields of use in which the Wellcome Trust is considering requiring licensing. The notice shall advise the Portfolio Company, its assignee or exclusive licensee of its rights, as set forth in this section. The determination to exercise Access Rights shall be made by the Director of the Wellcome Trust or designee.
(iv) Within 30 days after the receipt of the written notice of Wellcome Trust’s intent to exercise Access Rights, the Portfolio Company, its assignee or exclusive licensee may submit in person, in writing, or through a representative, information or argument in opposition to the proposed exercise of Access Rights, including any additional specific information which raises a genuine dispute over the material facts upon which the exercise of Access Rights is based. If the information presented raises a genuine dispute over the material facts, the Director of the Wellcome Trust shall undertake or refer the matter to the Director’s designee for fact-finding.
(v) Fact-finding shall be conducted in accordance with the procedures established by the Wellcome Trust. Such procedures shall be as informal as practicable and be consistent with principles of fundamental fairness. The procedures should afford the Portfolio Company, its assignee or exclusive licensee the opportunity to appear with counsel, submit documentary evidence, present witnesses and confront such persons as the Wellcome Trust may present. A transcribed record shall be made and shall be available at cost to the Portfolio Company, its assignee or exclusive licensee upon request. The requirement for a transcribed record may be waived by mutual agreement of the Portfolio Company, its assignee or exclusive licensee and the Wellcome Trust. Any portion of the proceeding, including a fact-finding hearing that involves testimony or evidence relating to the utilization or efforts at obtaining utilization that are being made by the Portfolio Company, its assignee, or licensees shall be closed to the public, including potential licensees. The Wellcome Trust shall not disclose any such information obtained during an Access Rights proceeding to persons outside the Wellcome Trust and CARB-X (including CARB-X Funders) except when such release is authorized by the Portfolio Company, its assignee or exclusive licensee.
(vi) The person conducting the fact-finding shall prepare or adopt written findings of fact and transmit them to the Director of the Wellcome Trust or designee promptly after the conclusion of the fact-finding proceeding along with a recommended determination. A copy of the findings of fact shall be sent to the Portfolio Company, its assignee or exclusive licensee by registered or certified mail. The Portfolio Company, its assignee or exclusive licensee and the Wellcome Trust representatives will be given 30 days to submit written arguments to the Director of the Wellcome Trust or designee; and, upon request by the Portfolio Company, its assignee or exclusive licensee, oral arguments will be held before the Director of the Wellcome Trust or designee that will make the final determination.
(vii) In cases in which fact-finding has been conducted, the Director of the Wellcome Trust or designee shall base his or her determination on the facts found, together with any other information and written or oral arguments submitted by the Portfolio Company, its assignee or exclusive licensee and the Wellcome Trust representatives, and any other information in the record. The consistency of the exercise of Access Rights with the objectives of promoting the utilization and public availability of inventions arising from funded research and protecting the public against nonuse or unreasonable use of inventions shall also be considered. In cases referred for fact-finding, the Director of the Wellcome Trust or designee may reject only those facts that have been found to be clearly erroneous, but must explicitly state the rejection and indicate the basis for the contrary finding. Written notice of the determination whether Access Rights will be exercised shall be made by the Director of the Wellcome Trust or designee and sent to the Portfolio Company, its assignee or exclusive licensee by certified or registered mail within 90 days after the completion of fact-finding or 90 days after oral arguments, whichever is later, or the proceedings will be deemed to have been terminated and thereafter no Access Rights based on the facts and reasons upon which the proceeding was initiated may be exercised.
(viii) The Wellcome Trust may, at any time, terminate a proceeding if it is satisfied that it does not wish to exercise Access Rights.
(ix) Any Portfolio Company, assignee or exclusive licensee adversely affected by Wellcome Trust’s final determination to exercise Access Rights under this Section 6.05 may, at any time within 60 days after the determination is issued, seek independent review of such determination by filing a civil action in the Courts of England and Wales. For the purposes of such action, the governing law of England and Wales shall apply. The scope and standard of review of the Wellcome Trust’s determination in such actions shall be that which would apply to U.S. Government determinations under Bayh-Dole Act petitions to the United States Court of Federal Claims (as allowed for in 35 U.S. C. §203(b)). In cases described in subsections (i) and (iii) of Section 6.05(a) above, a determination by the Director or designee unfavorable to the Portfolio Company (or its assignee or exclusive licensee) shall be held in abeyance pending the completion of any such independent review.
(c) Interpretive Guide. The Access Rights described herein are patterned on and intended to be similar in scope and effect as the U.S. Government Bayh-Dole Rights, as effective on the date this Agreement has been signed.