Shionogi – GARDP, Cefiderocol License Agreement

Business model | Governance

Structural Questions

Do the parties govern the project through a joint steering committee (“JSC”)? If so, what are the parties expressly designated roles and responsibilities with respect to the JSC?
Are there other committees, important governance bodies, or designated individual positions? What are the parties’ roles and responsibilities with respect to them?
Are the parties required to meet in accordance with a defined schedule for decision-making and progress reporting activities?
What are the resolution mechanisms for disputes related to the agreement?
Are there any requirements for policies or procedures to manage potential conflicts of interest?

Summary of Approaches

Do the parties govern the project through a joint steering committee (“JSC”)? If so, what are the parties expressly designated roles and responsibilities with respect to the JSC?
- A License Management Committee comprised of equal numbers of representatives from each party oversees and manages all licensing activities, including the management of sublicense agreements.
- The Committee operates by consensus.
Are the parties required to meet in accordance with a defined schedule for decision-making and progress reporting activities?
- The Licensing Management Committee must meet at least quarterly.
What are the resolution mechanisms for disputes related to the agreement?
- License Management Committee Matters
  - When the Licensing Management Committee is unable to reach a consensus, the matter is escalated to a Joint Steering Committee (“JSC”) established by the Collaboration Agreement.
  - If the JSC does not break the impasse, the matter is escalated to senior executives.
  - If the senior executives fail to resolve the dispute within 60 days, the parties either may begin binding arbitration, if the matter involves an interpretation of the Agreement, or mediation if the disagreement is strategic in nature or otherwise does not turn on the contract’s language.
- Publication & Regulatory Filings
  - Disagreements concerning proposed publication of results or regulatory finds are escalated to the JSC.
- Other Matters
  - For other matters, the parties first must attempt to resolve the dispute informally.
  - If informal attempts have not succeeded after 30 days, the parties may escalate the matter to their designated senior executives.
  - If the senior executives fail to resolve the issue within 30 days, the parties may refer the matter to binding arbitration.
  - Arbitration proceedings occur in New York, unless the parties agree otherwise, and in English. The commercial arbitration rules of the International Chamber of Commerce apply.

Annotations

This License and Technology Transfer Agreement is between Shionogi, a public pharmaceutical company located in Japan, and the Global Antibiotic Research and Development Partnership (“GARDP”), a Swiss nonprofit antibiotic R&D organization. The Agreement governs a non-exclusive license of Shionogi technology relating to the antibiotic drug cefiderocol and technology transfer necessary for third party sublicensees to develop and commercialize the drug in a list of high-, middle-, and low-income countries (“Territory”). The Agreement is effective as of June 15, 2022.

The Agreement includes provisions for the sublicense agreements between GARDP and third parties in Schedule F. We have included these provisions under the relevant MAPGuide issues as part of our analysis of the agreement.

The Agreement is part of a broader collaboration between the Clinton Health Access Initiative (“CHAI”), Shionogi and GARDP, which is governed by a separate agreement (“Collaboration Agreement”). The Collaboration Agreement addresses operational aspects of the collaboration, including a “Market Access Plan”, which plans and tracks the specific activities required of Shionogi and GARDP. The collaboration aims to achieve both affordable and sustainable access to medication and good antimicrobial stewardship.

Shionogi’s primary role in the Agreement is to license cefiderocol technology, provide an initial technology transfer and grant access to data already submitted to regulatory authorities. GARDP’s role is to manage a network of sublicensees to develop and commercialize cefiderocol. However, Shionogi has significant control over sublicensing. Some notable examples include: the right to refuse proposed sublicensees and proposed sublicense access plans, which set forth sublicensee commercialization plans. Shionogi also has the right to veto proposed development activities, including clinical trials, regulatory filings and trademarks. GARDP and GARDP sublicensees are jointly and severally liable for sublicensees for certain breaches of the Agreement or relevant sublicense agreement.

While Shionogi must refer enquiries from potential sublicensees to GARDP for joint evaluation, Shionogi ultimately may decide to directly license the technology for commercialization in the same territory.

Provision Language

2.LICENSE GRANT

[…]

2.8 License Management Subcommittee

(a) The Parties shall form a License Management Subcommittee, composed of an equal number of representatives from Shionogi and GARDP, which shall meet at least once per quarter to oversee and manage the licensing activities conducted pursuant to the License Agreement, and in particular, but not limited to:

(i) Review the management of Sublicense Agreements granted pursuant thereto.

(ii) Discuss any other matters that may arise in connection with the License Agreement.

(b) Any decisions made by the License Management Subcommittee shall require unanimous approval of all members of the License Management Subcommittee. If the License Management Subcommittee cannot reach consensus on a particular issue within its authority, such issue will be subject to an initial dispute resolution process involving escalation to the Joint Steering Committee formed pursuant to the Collaboration Agreement (it being understood that, although CHAI is a member thereof, CHAI shall not have any decision–making right in relation to matters relating to the management of this License Agreement or any Sublicense Agreement), and if the Joint Steering Committee is unable to resolve the issue, to senior executives of both Parties for negotiation and resolution. If the senior executives are unable in good faith to resolve the issue within sixty (60) days of it being submitted to them, then either Party may: (i) if the issue concerns a question of interpretation of this Agreement or of the Parties’ rights and obligations hereunder, demand resolution of the issue by binding arbitration pursuant to Section 14.6 of this License Agreement; or (ii) for strategic or other issues that cannot be resolved through interpretation of this Agreement or of the Parties’ rights and obligations hereunder, request a mediation procedure to assist in resolving the issue through appointment of a neutral, independent third party with appropriate expertise mutually agreed by the Parties, or if the Parties are unable to agree on such neutral third party within thirty (30) days following the request, by a neutral third party mediator with appropriate expertise appointed by the ICC. For the avoidance of doubt, this Section 2.8(b) shall not apply to any issues outside the authority of the License Management Subcommittee, including any matters that would involve amending the terms and conditions of this License Agreement.

13. DISPUTE RESOLUTION

13.1 Resolution by senior executives

(a) All disputes, controversies, or claims between the Parties in connection with this License Agreement, its construction, or the rights, duties, or liabilities of either Party under this License Agreement (a Dispute) must be resolved pursuant to the following resolution process in this Section 13.1 and the binding arbitration process in Section 14.6. The Parties may alter or amend these procedures by agreement in writing.

(b) To commence the resolution process, any Party may serve a notice on another Party identifying: (i) the nature of the Dispute; and (ii) if applicable, the amount in Dispute.

(c) Once notice is received, the Parties must first attempt in good faith to resolve such Dispute by negotiation and consultation between their respective operational teams.

(d) In the event that such Dispute is not resolved on an informal basis within thirty (30) days after such notice is received, either Party may, by written notice to the other Party, refer the Dispute to the Head of Shionogi’s Global Business Division and to GARDP’s Executive Director (together, the Designated Officers) for attempted resolution by good faith negotiation.

(e) If any such Dispute is not resolved by the Designated Officers within thirty (30) days after the receipt of the notice referring such Dispute to the Designated Officers, then either Party may initiate binding arbitration proceedings as contemplated by Section 14.6.

14. MISCELLANEOUS

14.6 Choice of law; Arbitration

This License Agreement, and any dispute arising from the performance or breach thereof, will be governed, and will be construed and enforced in accordance with the laws of the State of New York, without giving effect to the choice of laws provisions thereof that would require the application of the laws of any other jurisdiction.

If any Dispute is not resolved in accordance with Section 13.1, then either Party may submit such Dispute for final resolution by binding arbitration under the commercial arbitration rules of the International Chamber of Commerce (the “ICC”). The arbitration proceedings shall be conducted in the English language in (a) New York, New York or (b) another mutually agreed upon location. Nothing in this License Agreement shall limit the right of either Party to apply to the arbitration tribunal or any court of competent jurisdiction for any non–monetary interim relief or provisional remedy, including a temporary restraining order, preliminary injunction or other interim or conservatory relief that may be available under applicable law.

Download Full Agreement

Master Alliance Provisions Guide (MAPGuide)

Shionogi – GARDP, Cefiderocol License Agreement

Provision Language

Contact Us

Get In Touch

Browse

Contact Us

Get In Touch

Browse

Sign Up to Our Newsletter

Master Alliance Provisions Guide (MAPGuide)

Shionogi – GARDP, Cefiderocol License Agreement

Provision Language

Contact Us

Get In Touch

Browse

Contact Us

Get In Touch

Browse

Title

Sign Up to Our Newsletter

Agreement Type

Select Partner Type

Select Development Stage

Select Technology

Select Issue or Sub-issues