Wellcome Trust – PTC Therapeutics, Cancer Treatment Research Funding Agreement

Term & termination | Term of agreement

Summary of Approaches

What is the term of the agreement? Is it tied to the timeline of the project or license grants?
- The Agreement term begins on May 26, 2010, and ends on the latter of:
  - The expiration of the term of research program funding by the Trust;
  - The completion of the research program;
  - The expiration of the last to expire program patents;
  - The expiration of any agreement entered into for the exploitation of foreground or background IP; and
  - The expiration of any payment obligation relating to exploitation of the foreground or background IP.

Annotations

This research funding agreement is between Wellcome Trust (“the Trust”), a global health funder based in the U.K., and PTC Therapeutics (“PTC”), a U.S.-based biopharmaceutical company that focuses on small molecule and gene therapies for rare genetic disorders. The agreement concerns the Trust’s award of about $5.4 million in funding for early-stage research aimed at identifying small molecules that decrease the expression of BMI-1, a protein involved in tumor proliferation. The agreement is effective as of May 2010.

The research program provisions contemplate that PTC is responsible for the conduct of the funded research program, using its own intellectual property, under the supervision of a “Research Steering Group” (RSG) chaired by PTC’s principal investigator with representatives from PTC, the Trust and an independent industry expert. PTC is responsible for achieving research milestones, which entitle PTC to further tranches of the $5.4 million award.

The Trust’s “Site Visit Group” is entitled to access PTC premises and consult with PTC employees to assess the program’s progress, including whether PTC has met or is likely meet milestones or whether termination is warranted due to the program’s likelihood to achieve its overall objectives. PTC’s failure to address deficiencies identified by the Site Visit Group can entitle the Trust to terminate the agreement unilaterally.

PTC owns any foreground IP, and the agreement contemplates that either PTC or PTC licensees will develop and commercialize it. When PTC acts on a for-profit basis, it must pay royalties (or other payments) to the Trust in accordance with an attached schedule which sets out detailed revenue sharing scenarios. Nothing is owed when PTC acts on a non-profit basis, meaning that it makes sales either (i) at less than or equal to the Cost of Goods (determined in accordance with a detailed schedule); or (ii) to a charitable organization.

If PTC fails to develop or commercialize the IP or fails to do so for more than one “major market,” the Trust gains step-in rights that permit it to develop and exploit the IP. The parties will negotiate a revenue sharing arrangement if the Trust’s exploitation of the Project IP results in the receipt of revenue or other considerations. The parties agree that they will not enforce IP rights in the event of infringement or potential infringement by parties acting on a non-profit basis.

Provision Language

20. DURATION AND TERMINATION

20.1 This Agreement shall commence on the Commencement Date and shall continue for whichever is the longer of:

(a) the term of the funding under this Agreement and, if applicable, any further funding granted by the Trust in connection with or as a result of the Programme;

(b) the period that the Programme takes to complete;

(d) the expiry of any agreement entered into for the exploitation of the Programme Intellectual Property or the Background Intellectual Property; or

(e) the expiry of any payment obligation relating to the exploitation of the Programme Intellectual Property or the Background Intellectual Property.

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Wellcome Trust – PTC Therapeutics, Cancer Treatment Research Funding Agreement

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Wellcome Trust – PTC Therapeutics, Cancer Treatment Research Funding Agreement

Provision Language

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