Collaboration Agreement - Rigel Pharmaceuticals Inc. and Novartis Pharma AG
COLLABORATION AGREEMENT
THIS COLLABORATION AGREEMENT ("Agreement") is entered into as of May
26th, 1999 ("Effective Date") by and between RIGEL PHARMACEUTICALS, INC., a
Delaware corporation ("Rigel") with its offices at 240 East Grand Avenue,
South San Francisco, CA 94080, and NOVARTIS PHARMA AG, a Swiss corporation
("Novartis") with offices at Lichtstrasse 35, CH-4058, Basel, Switzerland
(collectively, "Parties"; individually, a "Party").
RECITALS
WHEREAS, Rigel is a leader in the discovery and validation of
intracellular target molecules involved in the modulation of human disease; and
WHEREAS, Novartis is engaged in the research, development, marketing,
manufacture and distribution of pharmaceutical compounds useful in treating or
preventing human diseases and conditions; and
WHEREAS, Rigel and Novartis desire to enter into a collaborative
relationship to conduct research on intracellular target molecules and to
discover, develop and manufacture pharmaceutical products useful for treating or
preventing diseases associated with human disease; and
WHEREAS, Novartis is purchasing two million (2,000,000) shares of Rigel
Series D Preferred Stock with a total value of US$4 million pursuant to a stock
purchase agreement between the Parties of even date herewith (the "Stock
Purchase Agreement"), and the Parties are further entering into an Equity Option
Agreement pursuant to which Novartis may purchase up to an additional US$10
million in value of Rigel equity;
NOW, THEREFORE, in consideration of the foregoing and the covenants and
promises contained in this Agreement, the Parties agree as follows:
1. DEFINITIONS
As used herein, the following terms (whether used in their singular or
plural form) shall have the following meanings:
"AFFILIATE" shall mean, with respect to a Party to this Agreement, any
other entity, whether de jure or de facto, which directly or indirectly
controls, is controlled by, or is under common control with, such Party. A
business entity or Party shall be regarded as in control of another business
entity if it owns, or directly or indirectly controls, at least fifty percent
(50%) (or such lesser percentage which is the maximum allowed to be owned by a
foreign entity in a particular jurisdiction) of the voting stock or other
ownership interest of the other entity, or if it directly or indirectly
possesses the power to direct or cause the direction of the management and
policies of the other entity by any lawful means whatsoever.
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"AT-NOVARTIS PROJECT" shall mean a Program of Research performed by
Novartis as provided in Section 4.2 hereof.
"B-CELL PROJECT" shall mean the Program of Research directed to the
identification of Novel Validated Targets involved in the process of B-Cell
activation, as the Program of Research is more fully described in Exhibit A-2
hereto.
"COLLABORATION PROJECT" shall mean a Joint Project or an At-Novartis
Project.
"COMMENCEMENT DATE" shall mean the date upon which a Collaboration
Project shall commence as set forth in Exhibit B or as determined pursuant to
the provisions of Section 2.2 hereof.
"COMPOUND SCREENING" shall mean the use of a primary assay for testing
biological or chemical materials, including chemical materials coming out of
high-throughput screening, to determine whether they show pharmaceutically
relevant activity.
"CONFIDENTIAL INFORMATION" shall mean any invention, discovery, patent
application or claim, trade secret, idea, improvement or other work of
authorship, any process, formula, data, program, drawing, information, price,
technique, sample, compound, extract, media, vector and/or cell line and
procedures and formulations for producing any such sample, compound, extract,
media, vector and/or cell line, any process, formula or data relating to any
research project, work in process, future development, engineering,
manufacturing, marketing, servicing, financing or personnel matter relating to a
Party, its present or future products, sales, suppliers, clients, customers,
employees, investors, or business, whether in oral, written, graphic or
electronic form.
"CONTROL" shall mean the possession of the ability to grant a license
or sublicense to know-how or patents without violating the terms of any
agreement or other arrangement with, or the rights of, any Third Party.
"COOPERATION MANAGEMENT COMMITTEE" or "CMC" shall mean the committee
formed pursuant to Section 3.1.
"EXCLUSIVITY TERM" shall have the meaning assigned to it in Section
5.2.
"EXTENSION FEE" shall have the meaning assigned to it in Section 7.5.
"FSC-STATUS" or "Final Selected Compound Status" shall mean the point
at which a Product is declared, following Novartis' standard compound
development procedures, an 'FSC Compound' or equivalent status by Novartis'
Research Management Board or some other similar body, which declaration
authorizes the initiation of preclinical development programs aimed, INTER ALIA,
at the detailed investigation of those toxicological, bioavailability,
pharmacokinetic and formulation parameters whose successful completion will
allow progression of the Product to Phase I Clinical Trials.
"FTE" shall mean the equivalent of a full-time twelve (12) months
(including normal vacations, sick days and holidays) work of a person,
carried out by one or more employees or consultants of a Party, each of whom
devotes all or a portion of his or her time to a Collaboration Project;
provided, however, that each Party understands and agrees that the other
Party retains complete discretion to change the identity, the frequency and
time which
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any individual employee devotes to a Collaboration Project. Scientific work
on or directly related to a Collaboration Project to be performed by a
Party's employees or consultants can include, but is not limited to,
experimental laboratory work, recording and writing up results, reviewing
literature and references, holding scientific discussions, managing and
leading scientific staff, and carrying out Research Cooperation management
duties (including service on the Cooperation Management Committee).
"JOINT INVENTION" shall have the meaning assigned to it in Section 8.1.
"JOINT PROJECT" shall mean a Program of Research which Novartis and
Rigel agree will be conducted collaboratively as provided in Section 4.1 hereof.
"JOINT TECHNOLOGY" shall mean Know-How and Patents conceived or reduced
to practice by at least one employee of Novartis and at least one employee of
Rigel during the course of a Program of Research.
"KNOW-HOW" shall mean any and all tangible or intangible know-how,
trade secret, invention (whether or not patentable), data, pre-clinical and
clinical result, physical, chemical or biological material, and other
information.
"LEAD COMPOUND" shall mean an active compound identified by Rigel in
the course of Compound Screening on the basis of a Novel Validated Target
pursuant to Section 5.6.
"MILESTONE EVENT" shall have the meaning assigned to it in Section 7.2.
"MILESTONE PAYMENT" shall have the meaning assigned to it in Section
7.2.
"NOTICE DATE" shall have the meaning assigned to it in Section 4.1.4
and 4.2.4.
"NOVARTIS KNOW-HOW" shall mean any Know-How that is necessary and
useful in a Program of Research and that Novartis owns or Controls on the
Effective Date, and any replication or any part of such information or material.
"NOVARTIS PATENTS" shall mean all Patents which claim inventions or
discoveries necessary and useful in a Program of Research and that that Novartis
owns or Controls on the Effective Date.
"NOVARTIS TECHNOLOGY" shall mean Novartis Know-How and Novartis
Patents, subject to any limitation contained in the agreements under which
Novartis' rights to the use of such Novartis Technology are derived.
"NOVEL VALIDATED TARGET" shall mean a specific molecule in an
intracellular signaling pathway which, when bound by a specific peptide, changes
in a predetermined way the phenotype of a target cell with a degree of
specificity and in a manner meeting the predetermined validation criteria set by
the CMC for Joint Projects and by Novartis for At-Novartis Projects.
"PATENTS" shall mean all foreign and domestic patents (including,
without limitation, extensions, reexaminations, reissues, renewals and inventors
certificates) and patents issuing from patent applications (including
substitutions, provisionals, divisionals, continuations and
continuations-in-part).
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"PHASE I CLINICAL TRIALS" shall mean first clinical trial where the
Product is applied in healthy human volunteers to test safety of such Product.
"PRODUCT" shall mean a molecule in the various stages of development
from identification in Compound Screening to and including commercialization,
which is useful to diagnose, treat or prevent human diseases or conditions and
whose principal mechanism of action by which it exerts its pharmacological
activity is based upon, derived from or discovered with the use of, a Novel
Validated Target.
"PROGRAM OF RESEARCH" shall mean research utilizing Rigel Technology to
identify specific target molecules and peptides which bind thereto that alter a
selected phenotype of a target cell population, including the use of retroviral
vector and expression systems which express libraries of molecules in target
cells, high-speed fluorescent cell sorting systems to identify the cells in
which the selected phenotype change has occurred and two-hybrid screening assays
to elaborate the intracellular interactions of the specific target molecules and
other means and methods, whether or not utilizing Rigel Technology, appropriate
in a particular program.
"PROGRAM PROPOSAL" shall mean a written description of a Program of
Research specifying in reasonable detail the specific goals of the project
including clinical objectives, target cells to be utilized, desired biologic
endpoints of assays of the target cells, project time frames and resource
requirements.
"PROJECT CONTACT PERSON" shall have the meaning assigned to it in
Section 3.8.
"PROJECT KNOW-HOW" shall mean Know-How developed, conceived or reduced
to practice by a Party in the course of a Collaboration Project.
"PROJECT PATENT" shall mean a Patent claiming Project Know-How.
"PROJECT TECHNOLOGY" shall mean Project Know-How and Project Patents.
"RESEARCH COOPERATION" shall mean the Joint Projects and the
At-Novartis Projects.
"RESEARCH PERIOD" shall mean, for each Joint Project and each
At-Novartis Project, five (5) years commencing as of the corresponding
Commencement Date, subject to earlier termination as permitted hereby.
"RIGEL CORE TECHNOLOGY" shall mean Rigel's proprietary packaging cell
lines (e.g., without limitation, that designated as Phoenix), high-speed
functional genomic screening technology, two-hybrid screening assays, retroviral
vector systems and expression systems that utilize these vectors to express
libraries of molecules in target cells and high speed fluorescent cell sorting
systems and any improvements thereon, and any Patents and Know-How relating
thereto owned or Controlled by Rigel, subject to any limitation contained in the
agreements under which Rigel's rights to the use of such Rigel Core Technology
are derived.
"RIGEL KNOW-HOW" shall mean any Know-How other than Rigel Core
Technology that is useful in a Collaboration Project and that Rigel owns or
Controls on the Effective Date and any replication or any part of such
information or material.
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"RIGEL PATENTS" shall mean all Patents other than Rigel Core
Technology which claim inventions or discoveries useful in a Collaboration
Project and that are owned or Controlled by Rigel on the Effective Date.
"RIGEL TECHNOLOGY" shall mean the Rigel Patents and Rigel Know-How,
subject to any limitation contained in the agreements under which Rigel's rights
to the use of such Rigel Technology are derived.
"SOLE INVENTIONS" shall have the meaning assigned to it in Section 8.1.
"T-CELL PROJECT" shall mean the Program of Research directed to the
identification of Novel Validated Targets involved in the process of T-Cell
activation, as the Program of Research is more fully described in Exhibit A-1
hereto.
"TERM OF AGREEMENT" shall have the meaning assigned to it in Section
11.1.
"TERRITORY" shall mean the entire world.
"THIRD PARTY" shall mean any person or entity other than Novartis,
Rigel and Affiliates of either.
2. SELECTION OF PROJECTS
2.1 NOVARTIS ACCESS TO FIVE PROJECTS. Novartis may have access to up to
five (5) Programs of Research of which at least two (2) will be Joint Projects
and no more than three (3) will be At-Novartis Projects.
2.2 PROPOSAL FOR A PROGRAM OF RESEARCH.
2.2.1 JOINT PROJECTS. A Program of Research for a Joint
Project may be proposed by Novartis or Rigel submitting to the other a Program
Proposal. Within thirty (30) days of receipt of a Program Proposal the receiving
party shall determine whether it has any agreement with a Third Party which
would prevent it from agreeing to conduct pursuant to this Agreement the Program
of Research identified in the Program Proposal and notify the proposing party
accordingly. If the receiving party is free to conduct the Program of Research
pursuant to this Agreement, the Parties shall meet to determine whether they
will agree to conduct such Program of Research pursuant to this Agreement. If
so, the CMC shall meet promptly to prepare a mutually agreeable description of
the Program of Research to be attached as an exhibit to this Agreement, to
specify the number of FTEs which will be utilized, the Commencement Date and the
number of FTEs as well as the resources to be allocated at Novartis. If the
receiving party is not free to conduct the Program of Research pursuant to this
Agreement, neither Party shall have any obligation or liability to the other
with respect to such Program of Research.
2.2.2 AT-NOVARTIS PROJECTS.
(a) Novartis may propose a Program of Research
for an At-Novartis Project by submitting to Rigel a corresponding Program
Proposal.
(b) Novartis shall have the right to proceed
with such Program of Research, unless Rigel notifies Novartis in writing within
thirty (30) days of receipt of a
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Program Proposal (i) that in Rigel's opinion, the Program of Research as
proposed by Novartis is scientifically not feasible, or (ii) that Rigel is
engaged in advanced negotiations with a Third Party regarding a collaboration
on a Program of Research which would conflict with the Program of Research
proposed by Novartis under this Agreement, or (iii) that Rigel has initiated
an internal Program of Research, as evidenced by written records, which would
conflict with the Program of Research proposed by Novartis.
(c) If Rigel provides to Novartis a notice
pursuant to subsection (b)(i) above, the Parties shall meet to discuss and
revise the proposed Program Proposal as appropriate to address Rigel's comments
and suggestions, whereafter Novartis shall have the right to proceed with such
Program of Research based on the revised Program Proposal. If Rigel provides to
Novartis a notice pursuant to subsection (b)(ii) or (b)(iii) above, such Program
of Research may not be pursued by Novartis, and neither Party shall have any
obligation or liability to the other with respect to such Program of Research.
(d) If Novartis has the right to proceed with a
Program of Research as provided in this Section 2.2.2, Novartis will provide to
Rigel a mutually agreeable description of the Program of Research, including the
validation criteria to be applied for determining whether a molecule is a Novel
Validated Target, to be attached as an exhibit to this Agreement which
description shall specify the Commencement Date of the At-Novartis Project.
Thereafter, the Parties will meet promptly to specify the Rigel Technology and
Rigel Core Technology to be transferred and the time of the transfer thereof to
Novartis pursuant to Section 4.2.5 hereof.
2.3 NUMBER AND KIND OF ADDITIONAL PROGRAMS OF RESEARCH. The parties
hereby agree that the Commencement Date of the T-Cell Project shall be the
Effective Date of this Agreement. Subject to Section 2.2, Novartis and Rigel
will add to this Agreement two (2) additional Programs of Research prior to the
first (1st) anniversary of the Effective Date and two(2) Programs of Research
prior to the second (2nd) anniversary of the Effective Date.
2.4 T-CELL PROJECT. Novartis and Rigel hereby agree that the T-Cell
Project is to be conducted as a Joint Project as provided in Section 4.1 and is
one of the Programs of Research referred to in Section 2.1. A mutually agreeable
description of the Program of Research is set forth in Exhibit A-1. The number
of FTEs and the Commencement Date for the T-Cell Project are set forth in
Exhibit B-1.
2.5 B-CELL PROJECT. Novartis hereby acknowledges that Rigel has
proposed the B-Cell Project as the second Joint Project in compliance with
Section 2.2, and that Novartis has no agreement with a Third Party which would
prevent it from agreeing to engage in the B-Cell Project pursuant to this
Agreement. A mutually agreeable description of the Program of Research for the
B-Cell Project is set forth in Exhibit A-2. The number of FTEs and the
Commencement Date for the B-Cell Project are set forth in Exhibit B-2. Novartis
will notify Rigel within ninety (90) days after the Effective Date whether it
agrees that the B-Cell Project shall be conducted as the second Joint Project.
If Novartis does not so agree, Rigel's proposal of the B-Cell Project shall be
considered withdrawn as of the ninety-first (91st) day after the Effective Date
and neither Novartis nor Rigel shall thereafter have any obligation or liability
to the other with respect to the B-Cell Project.
3. RESEARCH COOPERATION GOVERNANCE
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3.1 JOINT COOPERATION COMMITTEE FORMATION. The Research Cooperation
established by this Agreement shall be overseen or monitored, pursuant to the
provisions of Section 3.7 hereof, by a Cooperation Management Committee composed
of an equal number of representatives from each Party (the "Cooperation
Management Committee"). Each Party shall initially designate three (3)
representatives on the CMC within ten (10) business days after the Effective
Date. The addition of further representatives to the CMC, if any, shall occur
pursuant to the provisions of Section 3.3.6 hereof. Each Party may, upon notice
to the other Party, change its representatives to the CMC to allow for the
participation of different research groups within Novartis or Rigel, as the case
may be. The Parties shall agree upon the appropriate qualifications for members
of the CMC. An alternate member designated by a Party may serve temporarily in
the absence of a permanent member of the CMC for such Party. Each Party shall
designate one of its representatives as a Co-Chair of the CMC. Each Co-Chair of
the CMC will be responsible for the agenda and the minutes of alternating CMC
meetings.
3.2 CMC ACTIONS. Actions by the CMC pursuant to this Agreement shall be
taken only with unanimous approval of all of the representatives of the CMC. If
the CMC fails to reach unanimity on a matter before it for decision, the matter
shall be referred for resolution to the designated executives of the Parties
identified in Section 13.2.
3.3 MEETINGS OF THE CMC. The CMC:
3.3.1 shall hold meetings at such times and places as shall be
determined by the CMC (it being expected that meetings will alternate between
one of Novartis' research sites on the one hand and Rigel's head offices on the
other hand) but in no event shall such meetings be held in person less
frequently than once every three (3) months during the entire period during
which the Research Period of at least one Collaboration Project is not yet
expired or terminated;
3.3.2 may conduct meetings in person or by telephone or
video conference;
3.3.3 by mutual consent of the representatives of each Party,
may invite other personnel of either Party to attend meetings of the CMC;
3.3.4 may act without a meeting if prior to such action a
written consent thereto is signed by all members of the CMC;
3.3.5 may form and subsequently disband subcommittees with
appropriate representation from each Party;
3.3.6 may increase or decrease the equal number of CMC
representatives each Party can designate; and
3.3.7 may amend or expand upon the foregoing procedures for
its internal operation by unanimous written consent.
3.4 MINUTES. Subject to the provisions of Section 3.1 hereof, one of
the Co-chairs of the CMC will prepare, within ten (10) business days after each
meeting (whether held in person or by telephone or video conference), the
minutes reporting in reasonable detail the actions taken by the CMC, the status
of each Collaboration Project, the then current list of Novel Validated Targets,
issues requiring resolution and resolutions of previously reported
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issues, which minutes are to be approved by the signature of the CMC Co-Chair
of the other Party.
3.5 SUBCOMMITTEES. Any subcommittee established by the CMC shall have
appropriate representation of each Party and may include representatives of a
Party who are not members of the CMC. Any such subcommittee shall be subject to
the CMC and shall report its activities and actions to the CMC. At the request
of either Party at any time, any such committee shall be dissolved and its
powers and functions returned to the CMC.
3.6 REPORTS. Novartis and Rigel shall each provide written reports at
or before each CMC meeting describing its activities and results under the
Research Cooperation. Such reports shall be in such form and contain such detail
as the CMC shall determine.
3.7 CMC FUNCTIONS AND POWERS. The activities of the Parties under this
Agreement shall be managed by the CMC only to the extent set forth herein
(unless otherwise mutually agreed by the Parties). The CMC shall:
3.7.1 foster the collaborative relationship between the
Parties;
3.7.2 facilitate and monitor the technology transfer under
the Collaboration Projects;
3.7.3 approve the validation criteria for a Novel Validated
Target within sixty (60) days of each Commencement Date;
3.7.4 pursuant to Section 5.4 and provided Novartis has
requested Rigel screening thereunder, approve in advance the criteria for a Lead
Compound identified by Rigel and to be reported to Novartis;
3.7.5 monitor the progress of the research in the Joint
Projects;
3.7.6 monitor the status of At-Novartis Projects to allow
assessment of whether or when a Milestone Payment is due;
3.7.7 review and allocate annual FTEs in the Joint Projects,
within the framework of the contractually agreed funding level;
3.7.8 clear scientific publications relating to the Joint
Projects, and, insofar as containing work from both Parties, relating to
At-Novartis Projects, subject to the review and approval of both Parties
pursuant to Section 10.3;
3.7.9 perform such other functions as elsewhere explicitly
provided in this Agreement and as appropriate to further the purposes of this
Agreement as mutually determined by the Parties.
3.8 PROJECT CONTACT PERSONS. Subject to the CMC, the day-to-day
communication between the Parties and project coordination of each Joint Project
will be performed by two (2) "Project Contact Persons", one to be appointed by
each Party.
3.9 OBLIGATIONS OF PARTIES. Each one of the Parties shall have the
right to inspect the other Party's records through a qualified independent Third
Party, reasonably acceptable to the other Party, to determine whether the other
Party's performance complies with the
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terms of this Agreement, but not more frequently than once in any year during
the Research Period and subject to (1) the confidentiality obligations of
Article 10 and (2) any BONA FIDE obligations of confidentiality to a Third
Party.
3.10 LIMITATIONS OF POWERS OF THE CMC. The CMC shall have no power to
amend this Agreement and shall have only such powers as are specifically
delegated to it hereunder.
4. CONDUCT OF JOINT AND AT-NOVARTIS
4.1 CONDUCT OF JOINT PROJECTS.
4.1.1 SCOPE OF JOINT PROJECTS. Each Joint Project will be
conducted as a collaborative research program during its Research Period to
identify and validate Novel Validated Targets. The Parties intend that these
Novel Validated Targets will be suitable to enable Compound Screening to
identify molecules useful for the development and manufacture of Products.
4.1.2 REVISIONS OF JOINT PROJECTS. By mutual agreement in
writing the Parties may revise the scope of a Joint Project.
4.1.3 PERFORMANCE OF RESEARCH ACTIVITIES. Each Party will
perform the activities assigned to it in the Program of Research for each Joint
Project, or as directed by the CMC, in good scientific manner, and in compliance
with all applicable good laboratory practices and applicable legal requirements
to attempt to achieve efficiently and expeditiously its objectives described in
the Program of Research attached to this Agreement pursuant to Section 2.2.1.
4.1.4 IDENTIFICATION OF NOVEL VALIDATED TARGETS. Rigel shall
notify the CMC in writing of each Novel Validated Target identified by Rigel
during the Research Period of each Joint Project promptly after its
identification. Such notice shall be accompanied with a report and sufficient
data which establish that the validation criteria predetermined by the CMC
pursuant to Section 3.7.3 have been met. The CMC shall issue a list of the Novel
Validated Targets identified in the course of such Joint Project as a part of
the minutes of each CMC meeting and a final list within thirty (30) days after
the end of such Research Period. The date on which Rigel has delivered the
notice described in this Section 4.1.4, provided Novartis has not within ten
(10) business days of receipt of said notice informed Rigel that in Novartis'
opinion, the CMC-predetermined validation cirteria have not been met, shall be
considered the "Notice Date" of such Novel Validated Target. If Novartis informs
Rigel that in Novartis' opinion, the CMC-predetermined validation criteria have
not yet been met, the matter will be discussed and brought to a decision at the
next meeting of the CMC.
4.1.5 TECHNOLOGY TRANSFER. Rigel, as from time to time it may
be directed by the CMC, shall transfer to Novartis at no additional cost to
Novartis such Rigel Technology and Rigel Core Technology as shall be necessary
for the purpose of enabling Novartis to perform its responsibilities under the
applicable Program of Research of Joint Projects to identify Novel Validated
Targets. Novartis may use such Rigel Technology and Rigel Core Technology
pursuant to the licenses granted under this Agreement.
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4.1.6 SECONDMENT. In order to further a close working
relationship, the Parties may agree to provide offices and support at its
facilities for the personnel of the other Party.
4.2 CONDUCT OF AT-NOVARTIS PROJECTS.
4.2.1 SCOPE OF AT-NOVARTIS PROJECTS. Each At-Novartis Project
shall be performed by Novartis fully in-house to identify and validate Novel
Validated Targets. It is intended that these Novel Validated Targets will be
suitable to enable Compound Screening to identify molecules useful for the
development and manufacture of Products.
4.2.2 REVISIONS OF AT-NOVARTIS PROJECTS. By mutual agreement
in writing the Parties may revise the scope of an At-Novartis Project.
4.2.3 PERFORMANCE OF RESEARCH ACTIVITIES. Novartis will
perform research in accordance with the Program of Research for each
At-Novartis Project in good scientific manner, and in compliance with all
applicable good laboratory practices and applicable legal requirements to
attempt to achieve efficiently and expeditiously its objectives described in
the Program of Research attached to this Agreement pursuant to Section 2.2.2.
4.2.4 IDENTIFICATION OF NOVEL VALIDATED TARGETS. Novartis
shall notify the CMC in writing of any Novel Validated Targets identified by
Novartis during the Research Period of each At-Novartis Project promptly after
its identification. Such notice shall be accompanied with a report and
sufficient data which establish that the validation criteria predetermined
pursuant to Section 2.2.2(d) have been met. CMC shall issue a list of the Novel
Validated Targets identified in the course of such At-Novartis Project as a part
of the minutes of each CMC meeting and a final list within thirty (30) days
after the end of such Research Period. The date on which Novartis has provided
the notice described in this Section 4.2.4 shall be considered the "Notice Date"
of such Novel Validated Target.
4.2.5 TECHNOLOGY TRANSFER. Rigel will transfer to Novartis
such Rigel Technology and Rigel Core Technology, including without limitation
the Phoenix packaging cell line, as reasonably necessary to enable the target
identification activities Novartis is to perform in each At-Novartis Project as
proposed by Novartis and reasonably acceptable to Rigel; provided, however, that
Novartis shall reimburse Rigel its reasonable costs and expenses therefor.
Novartis may use such Rigel Technology and Rigel Core Technology pursuant to the
licenses granted under this Agreement.
4.3 ADDITIONAL PROJECTS. If Novartis expresses an interest in
cooperating with Rigel with respect to any Programs of Research in addition to
the two Joint Projects and three At-Novartis Projects, Rigel and Novartis will
meet promptly to discuss in good faith whether and under what terms they could
agree to cooperate with respect to such further research projects.
4.4 DISCLOSURE. Rigel and Novartis will disclose to the CMC promptly
and at least quarterly the results of the research activities conducted in each
Collaboration Project, such reports to be in such form as specified by the CMC.
The Parties shall keep complete and accurate records pertaining to the results
of work conducted pursuant to each Collaboration Project. Such records shall be
maintained by each Party for a period of at least three (3) years following the
year in which any such efforts were made hereunder.
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4.5 DISCRETIONARY TERMINATION OF RESEARCH PERIOD.
4.5.1 DISCRETIONARY TERMINATION DATE FOR JOINT PROJECTS.
Novartis may at its discretion terminate each Joint Project, individually, upon
at least six (6) months prior written notice as hereinafter provided. If
Novartis gives notice of termination for a given Joint Project no later than
eighteen (18) months from the applicable Commencement Date, termination of such
Joint Project will take effect at twenty-four (24) months from its Commencement
Date. If Novartis gives notice of termination for a given Joint Project after
eighteen (18) months but no later than thirty-six (36) months from the
applicable Commencement Date, termination of such Joint Project will take effect
at forty-two (42) months from its Commencement Date.
4.5.2 DISCRETIONARY TERMINATION OF AT-NOVARTIS PROJECTS.
Novartis may, at its discretion, terminate each At-Novartis Project,
individually, at any time with immediate effect.
4.5.3 EFFECT OF DISCRETIONARY TERMINATION.
(a) If Novartis terminates the T-Cell Project
effective twenty-four (24) months after the applicable Commencement Date or
forty-two (42) months after the applicable Commencement Date, Novartis will keep
all rights and licenses granted under Section 6.2 with respect to those Novel
Validated Targets identified prior to the termination of the Research Period,
subject to the applicable milestone and/or royalty payment obligations of
Article 7 and Exhibit C.
(b) If Novartis terminates any Joint Project other
than the T-Cell Project
(i) effective twenty-four (24) months
after the applicable Commencement Date, all licenses granted to Novartis
relating to such Joint Project shall terminate upon the termination such Joint
Project, and the rights to all Novel Validated Targets identified as of the date
of termination shall revert to Rigel;
(ii) effective forty-two (42) months from
the applicable Commencement Date, Novartis will keep all rights and licenses
granted under Section 6.2 with respect to those Novel Validated Targets
identified prior to the termination of the Research Period, subject to the
applicable milestone and/or royalty payment obligations of Article 7 and Exhibit
C.
(c) If Novartis terminates any At-Novartis
Project at or effective prior to forty-two (42) months after the applicable
Commencement Date, all licenses granted to Novartis relating to such At-Novartis
Project shall terminate upon termination of such At-Novartis Project, and the
rights to all Novel Validated Targets identified as of the date of termination
shall revert to Rigel. If Novartis terminates an At-Novartis Project after
forty-two (42) months, Novartis shall keep the rights to the Novel Validated
Targets identified in the course of such At-Novartis Project as licensed under
Section 6.2.
4.6 TERMINATION OF COLLABORATION PROJECT FOR BREACH.
4.6.1 Either Party may terminate a Collaboration Project after
sixty (60) days prior notice to the other that the other Party has committed a
material breach of its obligations
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in the performance of such Collaboration Project unless the other Party cures
(to the extent practicable) the breach within such period of time.
4.6.2 If Novartis terminates a Collaboration Project under
Section 4.6.1 above, Novartis will keep all rights and licenses granted under
Section 6.2 with respect to those Novel Validated Targets identified prior to
the termination of the Research Period, subject to the applicable milestone
and/or royalty payment obligations of Article 7 and Exhibit C.
4.6.3 If Rigel terminates a Collaboration Project under
Section 4.6.1 above, all licenses granted to Novartis for such Collaboration
Project shall terminate and the rights to all Novel Validated Targets identified
in the course of such Collaboration Project shall revert to Rigel.
4.7 TERMINATION OF JOINT PROJECT FOR SCIENTIFIC REASONS. If it is
determined by both Parties before the end of the 12th month of a Joint Project
already underway that it is no longer scientifically feasible, the Parties shall
meet for good faith discussions to determine if an alternate project may be
substituted on substantially similar terms. If after the 12th month of a Joint
Project the CMC determines that for scientific reasons, a Joint Project cannot
yield any Novel Validated Targets, or that such Novel Validated Targets will not
be suitable for Compound Screening in high-throughput format, Novartis shall
have to right to terminate such Joint Project with written notice effective upon
receipt by Rigel. Upon such termination, Novartis shall make to Rigel, upon
receipt of a corresponding invoice, a termination payment for non-cancelable
commitments and other costs incurred by Rigel due to such termination
corresponding to three (3) months of the research support payable pursuant to
Section 7.1. Upon termination pursuant to this Section 4.7, all licenses granted
to Novartis for such Joint Project shall terminate, and the rights to all Novel
Validated Targets identified in the course of such Joint Project (if any) shall
revert to Rigel.
4.8 EXISTING OBLIGATIONS. The termination of any Research Period shall
not relieve the Parties of any obligation that accrued prior to such expiration
or termination.
5. COMPOUND SCREENING AND DEVELOPMENT
5.1 NOVARTIS COMPOUND SCREENING. Novartis shall have the right to
initiate Compound Screening with each Novel Validated Target upon notice to
Rigel any time during the Exclusivity Term with respect to such Novel Validated
Target.
5.2 EXCLUSIVITY TERM. Novartis' screening right under Section 5.1 shall
be exclusive ('exclusive', as used in this Section 5.2 and subject to the
provisions of Section 5.5, shall mean 'to the exclusion also of Rigel') during
the first two (2) years ("Exclusivity Term") after the Notice Date. Subject to
Section 5.3, Novartis may, after the first two years, extend the Exclusivity
Term with respect to a Novel Validated Target for up to five (5) additional one
(1) year periods upon payment to Rigel of the appropriate Extension Fee provided
in Section 7.5 on or before (i) the day which is thirty (30) days prior to the
end of such Exclusivity Term or (ii) if Novartis has informed Rigel in writing
on or before a date with is sixty (60) days prior to the end of such Exclusivity
Term, thirty (30) days after receipt of a corresponding invoice from Rigel,
whichever is the later. Upon expiration of the Exclusivity Term, Novartis' right
to conduct Compound Screening with a Novel Validated Target, subject to the
payments required by Section 7.2 and 7.4, shall become nonexclusive
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and Rigel shall also have the nonexclusive right, including the right to
sublicense, to conduct Compound Screening with such Novel Validated Target.
5.3 NOVARTIS DILIGENCE.
5.3.1 In addition to the payment of the Extension Fee and as a
further condition for Novartis to extend the Exclusivity Term, Novartis shall be
obligated to maintain itself or through its Affiliates or sublicensees a
diligent, continuous program of utilizing the Novel Validated Target to identify
molecules useful for the development and manufacture of Products.
5.3.2 Novartis shall be deemed to be maintaining a diligent
continuous program with respect to a Novel Validated Target if Novartis (i) is
actively using the Novel Validated Target in Novartis' screening systems for
Compound Screening or, (ii) is actively undertaking diligent, commercially
reasonable efforts, similar to those used for products of comparable commercial
potential originating in Novartis for the continuing development of a Product
and the commercialization of a Product including, without limitation, the
performance of an active derivatisation and lead optimization program, the
designation of FSC Status, initiation of clinical trials, submission of
regulatory filings and commercial launch of a Product.
5.4 REPORTING. During each applicable Exclusivity Term, Novartis shall
provide information on its activities under Section 5.3.1 or 5.3.2 above to the
CMC on a quarterly basis. At any time during the Exclusivity Term with respect
to a Novel Validated Target, Novartis shall on a not less than quarterly basis
provide documentation to the reasonable satisfaction of Rigel that Novartis is
maintaining a diligent, continuous program with respect to the Novel Validated
Target.
5.5 CONVERSION OF EXCLUSIVE RIGHT. If Novartis does not pay the
Extension Fee or does not maintain a diligent continuous program with respect to
a Novel Validated Target as provided in Section 5.3 above, then the Exclusivity
Term shall be deemed expired and Novartis' screening right under Section 5.1,
subject to the payments required by Section 7.2 and 7.4, shall become
non-exclusive, perpetual, and fully paid-up, and Rigel shall have the
nonexclusive right, including the right to sublicense, to conduct Compound
Screening with such Novel Validated Target.
5.6 RIGEL SCREENING. At any time during the Exclusivity Term with
respect to a Novel Validated Target, Novartis, at its sole discretion, may
request in writing that Rigel conduct Compound Screening of Rigel's
small-molecule compound library against such Novel Validated Target. If Rigel
agrees to conduct such screening, the CMC shall establish criteria for an
active compound to qualify as a Lead Compound. Thereafter, Rigel will conduct
such screening pursuant to a workplan to be agreed to by the Parties. If
Rigel identifies a Lead Compound, it shall so notify Novartis, and Section
6.4 hereof shall then apply.
6. LICENSE GRANTS; NONCOMPETITION
6.1 RESEARCH LICENSE GRANTS.
6.1.1 GRANT BY RIGEL. Rigel hereby grants to Novartis and its
Affiliates a nonexclusive, non-transferable, royalty-free license during the
Research Period for each
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Collaboration Project under the Rigel Technology, Rigel Core Technology and
Rigel's interest in Project Technology in the Territory, subject to the terms of
this Agreement, solely for the purpose of carrying out Novartis'
responsibilities under the applicable Collaboration Project.
6.1.2 GRANT BY NOVARTIS. Novartis hereby grants to Rigel and
its Affiliates a nonexclusive, non-transferable, royalty-free license during the
Research Period for each Collaboration Project under the Novartis Technology and
Novartis' interest in the Project Technology, subject to the terms of this
Agreement, solely for the purpose of carrying out Rigel's responsibilities under
the applicable Collaboration Project.
6.2 COMMERCIAL LICENSE GRANTS.
6.2.1 Subject to Section 5.3 and the other terms and
conditions of this Agreement, Rigel hereby grants to Novartis and its Affiliates
an exclusive license, with the right to grant sublicenses, under the Rigel
Technology and Rigel's interest in the Project Technology to make, have made,
use, import, offer for sale and sell Products.
6.2.2 Subject to the terms and conditions of this Agreement,
Rigel hereby grants to Novartis and its Affiliates a nonexclusive,
non-transferable, royalty-free license under Rigel Core Technology only for
confirmational screening and similar uses relating to Novel Validated Targets
identified in the course of a Collaboration Project, it being understood that
Novartis has the right to use such Technology for the purposes of further
development, registration and commercialisation of Products.
6.3 LICENSE TO RIGEL OF IMPROVEMENTS TO RIGEL CORE TECHNOLOGY. Novartis
hereby grants to Rigel a nonexclusive, royalty-free, worldwide license, with the
right to sublicense, under Novartis' interest in the Project Technology only to
the extent it constitutes an improvement of the Rigel Core Technology licensed
to Novartis hereunder. For the avoidance of any doubt, the license granted by
Novartis under this Section 6.3 shall not include, without limitation, any
Patents or Know-How claiming the composition of matter, method of making or use
of Products.
6.4 OPTION FOR LICENSE FOR RIGEL LEAD COMPOUND. Novartis shall have an
option during the ninety (90) days following receipt of Rigel's notice of
identification of a Lead Compound as provided in Section 5.6 to negotiate with
Rigel a worldwide, exclusive license to such Lead Compound and compounds derived
therefrom under terms to be agreed but including those shown on Exhibit C
hereto. If Novartis does not execute such a license within such period, Rigel
shall have no further obligation or liability to Novartis for such Lead
Compound.
7. FINANCIAL SUPPORT
7.1 RESEARCH SUPPORT. Novartis will provide funding to support Rigel's
efforts during the Research Period of each Joint Project, on an FTE basis at a
rate of $250,000 per year multiplied by the number of FTEs as shown in Exhibit B
for such Joint Project. The amounts payable shall be paid in advance by
certified or bank check or wire transfer in United States dollars in four equal
payments to be paid quarterly upon presentation of a corresponding invoice by
Rigel. Payments shall be made no later than (a) by the first (1st) business day
of each applicable Research Period quarter or (b) thirty (30) days after receipt
of the
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corresponding invoice, whichever is the later. Research support under this
Section 7.1 shall not be credited against any equity, milestone or royalty
payments due Rigel hereunder.
7.2 MILESTONE PAYMENTS TO RIGEL. Novartis will pay to Rigel the
following amounts ("Milestone Payments") in respect of the achievements with
respect to each Joint Project and each At-Novartis Project:
----------------------------------------------------------------------------------------------------
MILESTONE EVENT AMOUNT OF PAYMENT
----------------------------------------------------------------------------------------------------
1) NOTICE DATE OF THE FIRST NOVEL VALIDATED TARGET $500,000
----------------------------------------------------------------------------------------------------
2) NOTICE DATE OF EACH SUBSEQUENT NOVEL VALIDATED TARGET $250,000
- PER NOVEL VALIDATED TARGET
----------------------------------------------------------------------------------------------------
3) INITIATION OF COMPOUND SCREENING WITH EACH NOVEL
VALIDATED TARGET:
PER NOVEL VALIDATED TARGET:
FIRST FOUR (4) NOVEL VALIDATED TARGETS, CUMULATED OVER $1.25 million
ALL COLLABORATION PROJECTS
EACH SUBSEQUENT NOVEL VALIDATED TARGET $1 million
----------------------------------------------------------------------------------------------------
4) FSC STATUS DECLARATION OF THE FIRST PRODUCT IDENTIFIED IN $1.5 million
COMPOUND SCREENING CONDUCTED AGAINST EACH NOVEL VALIDATED
TARGET PURSUANT TO SECTION 5.3 - PER NOVEL VALIDATED TARGET
----------------------------------------------------------------------------------------------------
5) FIRST PRODUCT IDENTIFIED ON THE BASIS OF A NOVEL VALIDATED $2.5 million
TARGET ENTERS PHASE I CLINICAL TRIALS - PER NOVEL VALIDATED
TARGET
----------------------------------------------------------------------------------------------------
All Milestone Payments to be made by Novartis to Rigel pursuant
to this Section 7.2 shall be made within thirty (30) days of receipt of an
invoice from Rigel. Novartis shall promptly report to Rigel the occurrence of
the Milestone Events 3), 4), and 5).
7.3 PROJECT ACCESS PAYMENTS. No later than (a) by the Commencement Date
of each Joint Project and each At-Novartis Project or (b) thirty (30) days after
receipt of the corresponding invoice from Rigel, whichever is the later,
Novartis will pay Rigel a project access fee of $400,000.
7.4 ROYALTIES. Novartis shall pay to Rigel all royalties due to Third
Party licenses listed on Exhibit D hereto in the event Novartis shall practice
the inventions of the Patents licensed thereunder. Further, if applicable
pursuant to Articles 5.6 and 6.4, Novartis shall pay to Rigel the royalties as
provided in Exhibit C. For the avoidance of any doubt, Novartis shall pay to
Rigel no other royalties under this Agreement.
7.5 EXTENSION FEE. As provided in Section 5.2, the amount payable by
Novartis to extend the Exclusivity Term for each year after the initial two (2)
year Exclusivity Term
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for a Novel Validated Target ("Extension Fee") shall be $50,000 for the third
(3rd) year, $100,000 for the fourth (4th) year and, $200,000 for each of the
fifth (5th), sixth (6th) and seventh (7th) year.
8. INTELLECTUAL PROPERTY
8.1 OWNERSHIP OF PROJECT KNOW-HOW; INVENTIONS. Project Know-How
invented (as determined in accordance with United States rules of inventorship)
solely by employees of one Party during the course of a Collaboration Project
("Sole Inventions") shall be the property of such Party. In the event that
employees of Novartis and Rigel jointly invent any Project Know-How (again as
determined in accordance with United States rules of inventorship), such Project
Know-How shall be owned jointly by Novartis and Rigel, each to own an undivided
one-half (1/2) interest in such Project Know-How ("Joint Invention") except as
provided herein. Each Party shall cooperate with the other in completing any
patent applications relating to Joint Inventions, and in executing and
delivering any instrument required to assign, convey or transfer to such other
Party its undivided one-half (1/2) interest.
8.2 PATENT PROSECUTION.
8.2.1 Novartis Patents and Rigel Patents licensed hereunder
shall be prosecuted and maintained by Novartis and Rigel, respectively, at such
Party's option and its own expense; provided, however, that the Parties shall
consult with and consider the comments of the CMC with respect to the
prosecution of applications for such patents.
8.2.2 Each Party will prepare, file, prosecute and maintain
patent applications for its Sole Inventions and shall be responsible for related
interference proceedings.
8.2.3 In case of Joint Inventions, the Parties will
mutually agree on the responsibility for filing and prosecuting applications
or patent applications relating thereto, and the defense against Third
Parties who infringe on Patents issuing thereon.
8.3 INFRINGEMENT OF THIRD-PARTY RIGHTS.
8.3.1 If a Third Party claims that the practice of the Rigel
Technology or Rigel Core Technology under this Agreement infringes on its
Patents, each Party shall notify the other Party promptly upon learning of such
claim.
8.3.2 Promptly upon such notification, the Parties shall meet
to discuss the strategy and appropriate steps to be taken to deal with such
claim, including, without limitation, by working around the Patents of the Third
Party, by practicing the Rigel Technology or Rigel Core Technology in countries
where the Third Party has no applicable Patents, by seeking to invalidate the
Third Party Patents or by entering into negotiations with such Third Party
regarding a license under its Patents. The Parties shall further agree on an
equitable and fair distribution of the costs resulting from any such course of
action.
9. REPRESENTATIONS AND WARRANTIES
9.1 REPRESENTATIONS AND WARRANTIES. Each Party represents and
warrants to the other that:
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9.1.1 CORPORATE POWER. It is duly organized and validly
existing under the laws of its state or country of incorporation, and has full
corporate power and authority to enter into this Agreement and to carry out the
provisions hereof.
9.1.2 DUE AUTHORIZATION. It is duly authorized to execute and
deliver this Agreement and to perform its obligations hereunder, and the person
or persons executing this Agreement on its behalf has been duly authorized to do
so by all requisite corporate action.
9.1.3 BINDING AGREEMENT. This Agreement is legally binding
upon it and enforceable in accordance with its terms. The execution, delivery
and performance of this Agreement by it does not conflict with any agreement,
instrument or understanding, oral or written, to which it is a party or by which
it may be bound, nor violate any material law or regulation of any court,
governmental body or administrative or other agency having jurisdiction over it.
9.1.4 GRANT OF RIGHTS; MAINTENANCE OF AGREEMENTS. It has not,
and will not during the Term of the Agreement, grant any right to any Third
Party which would conflict with the rights granted to the other Party hereunder.
It has (or will have at the time performance is due) maintained and will
maintain and keep in full force and effect all agreements necessary to perform
its obligations hereunder.
9.1.5 VALIDITY. It is aware of no action, suit or inquiry or
investigation instituted by any governmental agency which questions or threatens
the validity of this Agreement.
9.1.6 EMPLOYEE OBLIGATIONS. All of its employees, officers and
consultants have executed agreements requiring in the case of employees and
officers, assignment to the Party of all inventions made during the course of
and as a result of their association with such Party and obligating the
individual to maintain as confidential the confidential information of the
Party, as well as the confidential information of a Third Party which such Party
may receive.
9.2 DISCLAIMER CONCERNING TECHNOLOGY. THE TECHNOLOGY PROVIDED BY EACH
PARTY HEREUNDER IS PROVIDED "AS IS" AND EACH PARTY EXPRESSLY DISCLAIMS ANY AND
ALL WARRANTIES OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION THE
WARRANTIES OF DESIGN, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE,
NONINFRINGEMENT OF THE INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES OR ARISING
FROM A COURSE OF DEALING, USAGE OR TRADE PRACTICES, IN ALL CASES WITH
RESPECT THERETO. Without limiting the generality of the foregoing, each Party
expressly does not warrant (i) the success of any Program of Research or (ii)
the safety or usefulness for any purpose of the technology it provides
hereunder.
10. CONFIDENTIALITY; PUBLICATION
10.1 CONFIDENTIALITY. Except to the extent expressly authorized by this
Agreement or otherwise agreed in writing by the Parties, the Parties agree that,
for the Term of the Agreement and for five (5) years thereafter, the receiving
Party (the "Receiving Party") shall keep confidential and shall not publish or
otherwise disclose and shall not use for any purpose other than as provided in
this Agreement any Confidential Information furnished to it
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by the other Party (the "Disclosing Party") pursuant to this Agreement unless
the Receiving Party can demonstrate by contemporaneous, competent written proof
that such Confidential Information:
(a) was already known to the Receiving Party, other
than under an obligation of confidentiality, at the time of disclosure by the
Disclosing Party;
(b) was generally available to the public or
otherwise part of the public domain at the time of its disclosure to the
Receiving Party;
(c) became generally available to the public or
otherwise part of the public domain after its disclosure and other than
through any act or omission of the Receiving Party in breach of the Agreement;
(d) was disclosed to the Receiving Party, other than
under an obligation of confidentiality to a Third Party, by a Third Party who
had no obligation to the Disclosing Party or any Third Party not to disclose
such information to others; or
(e) was independently discovered or developed by the
Receiving Party without the use of Confidential Information belonging to the
Disclosing Party.
10.2 AUTHORIZED DISCLOSURE.
10.2.1 Each Party may disclose Confidential Information
belonging to the other Party to the extent such disclosure is reasonably
necessary in the following instances:
(a) filing or prosecuting Patents relating to
Project Know-How;
(b) regulatory filings;
(c) prosecuting or defending litigation;
(d) complying with applicable governmental
regulations;
(e) conducting pre-clinical or clinical trials of
Products; and
(f) disclosure to Affiliates, sublicensees,
employees, consultants or agents who agree to be bound by similar terms of
confidentiality and non-use at least equivalent in scope to those set forth
in this Article 10.
10.2.2 Notwithstanding the foregoing, in the event a Party is
required to make a disclosure of the other Party's Confidential Information
pursuant to this Section 10.2 it will, except where impracticable, give
reasonable advance notice to the other Party of such disclosure and use
commercially reasonable efforts to secure confidential treatment of such
information. In any event, the Parties agree to take all reasonable action to
avoid disclosure of Confidential Information hereunder. The Parties will consult
with each other and agree on the provisions of this Agreement to be redacted in
any filings made by the Parties with the Securities and Exchange Commission or
as otherwise required by law.
10.3 PUBLICATIONS.
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10.3.1 REVIEW AND APPROVAL. Each Party to this Agreement
recognizes that the publication of papers, including oral presentations and
abstracts, regarding the Research Cooperation, subject to reasonable controls to
protect Confidential Information, can be beneficial to both Parties. However,
each Party shall have the right to review and approve any paper proposed for
publication by the other Party, including oral presentations and abstracts,
which utilizes data generated from the Research Cooperation or includes
Confidential Information of the reviewing Party.
10.3.2 REVIEW AND APPROVAL PROCESS. At least forty-five (45)
days before any such paper is presented or submitted for publication, the Party
proposing publication shall deliver a complete copy to the other Party. The
receiving Party shall review any such paper and give its comments to the
publishing Party within thirty (30) days of the delivery of such paper to the
receiving Party. With respect to oral presentation materials and abstracts, the
Parties shall make reasonable efforts to expedite review of such materials and
abstracts, and shall return such items as soon as practicable to the publishing
Party with appropriate comments, if any, but in no event later than thirty (30)
days from the delivery date thereof to the receiving Party. The publishing Party
shall comply with the other Party's request to delete references to such other
Party's Confidential Information in any such paper and agrees to withhold
publication of same an additional ninety (90) days in order to permit the
Parties to obtain patent protection, if either of the Parties deem it necessary,
in accordance with the terms of this Agreement.
10.4 SAMPLES. Samples of compounds provided by one Party (the
"Supplying Party") to the other Party (the "Receiving Party") during the
Research Program shall not be supplied or sent by the Receiving Party to any
Third Party without the written consent of the Supplying Party. The Receiving
Party shall return to the Supplying Party any samples not used upon expiration
or termination of the applicable Research Period, except that Novartis may
retain such samples to the extent necessary to exercise the licenses granted in
Section 6.2.
11. TERM AND TERMINATION
11.1 TERM OF THE AGREEMENT. This Agreement shall become effective upon
the Effective Date and continue until the later of (i) the expiration of the
obligation of Novartis to pay royalties as provided in Section 7.4, and (ii) the
expiration of the last Patent licensed to Novartis under this Agreement,
whereupon the licenses granted under Sections 6.2 and 6.3 shall be deemed
non-exclusive, perpetual and fully paid-up.
11.2 TERMINATION FOR MATERIAL BREACH. Each Party shall have the right
to terminate this Agreement after ninety (90) days prior notice to the other
that the other Party has committed a material breach of the Agreement other than
performance of obligations under a Collaboration Project, unless the other Party
cures (to the extent practicable) the breach within such period of time.
Licenses granted to the non-breaching Party under Section 6 of this Agreement
shall not be affected by termination for material breach. All licenses granted
to the breaching Party under Section 6 of this Agreement shall automatically
terminate upon such termination.
11.3 ACCRUED RIGHTS, SURVIVING OBLIGATIONS. Expiration or termination
of this Agreement shall not affect any accrued rights or obligations of either
Party. Sections 9, 10, 11 (and Section 6 to the extent referenced therein), 12,
13, 14.1, and 14.3 through 14.10, and any
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definitions of terms used therein shall survive any expiration or termination of
this Agreement.
12. INDEMNITY
12.1 INDEMNIFICATION. Each Party hereby agrees to save, defend and hold
the other Party and its directors, officers, employees, and agents harmless from
and against any and all claims, suits, actions, demands, liabilities, expenses
and/or loss, including reasonable legal expense and attorneys' fees
(collectively, "Claims") for damage to persons or property resulting directly or
indirectly from actions in connection with a Collaboration Project by the
indemnifying Party, its Affiliates, agents or sublicensees, but only to the
extent such Claims result from the gross negligence or willful misconduct of the
indemnifying Party or its Affiliates, agents or sublicensees and do not result
from the negligence of the Party seeking indemnification.
12.2 PRODUCT LIABILITY. Novartis hereby agrees to indemnify, hold
harmless and defend Rigel and its directors, officers, employees, and agents
against any Claim or Claims, including, but not limited to claims for bodily
injury and death, resulting from or arising out of the manufacture, use or sale
of Products by Novartis, its Affiliates and sublicensees.
12.3 CONTROL OF DEFENSE. Any entity entitled to indemnification under
this Article 12 shall give notice to the indemnifying Party of any Claims that
may be subject to indemnification and, promptly after learning of such Claim,
the indemnifying Party shall assume the defense of such Claims with counsel
reasonably satisfactory to the indemnified Party. If such defense is assumed by
the indemnifying Party with counsel so selected, the indemnifying Party will not
be subject to any liability for any settlement of such Claims made by the
indemnified Party without its consent (but such consent will not be unreasonably
withheld or delayed), and will not be obligated to pay the fees and expenses of
any separate counsel retained by the indemnified Party with respect to such
Claims.
13. GOVERNING LAW; DISPUTE RESOLUTION
13.1 GOVERNING LAW. This Agreement shall be governed by laws of the
state of Delaware, as such law applies to contracts entered into in Delaware by
residents of Delaware, without reference to its choice of law provisions.
13.2 DISPUTE RESOLUTION. In the event of any dispute, the Parties shall
refer such dispute to a designated executive of Rigel and a designated executive
of Novartis for attempted resolution by good faith negotiations within thirty
(30) days after such referral is made. In the event such executives are unable
to resolve such dispute within such thirty (30) day period, either Party may
invoke the provisions of Section 13.3 below.
13.3 JURISDICTION AND VENUE. Except as provided in Section 13.2 above,
any claim or controversy arising out of or related to this Agreement or any
breach hereof shall be adjudicated in the federal district court of Dover,
Delaware, and the Parties hereby consent to the jurisdiction and venue of such
court.
14. GENERAL PROVISIONS
14.1 NOTICES. All notices required or permitted to be given under this
Agreement shall be in writing and shall be mailed by registered or certified
mail addressed to
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the signatory to whom such notice is required or permitted to
be given and transmitted by facsimile to the number indicated below. All notices
shall be deemed to have been given when mailed, as evidenced by the postmark at
the point of mailing, or faxed; provided that such fax is confirmed by
electronic confirmation of transmission.
All notices to Novartis shall be addressed as follows:
Novartis Pharma AG
Lichtstrasse 35
P.O. Box
CH-4002 Basel
Switzerland
Attn: Legal Department
Fax: +41-61-324-6859
All notices to Rigel shall be addressed as follows:
Rigel Pharmaceuticals, Inc.
240 East Grand Avenue
South San Francisco, CA 94080
Attn: President
Fax: +1-650-624-1101
with a copy to:
Cooley Godward LLP
Five Palo Alto Square
3000 El Camino Real
Palo Alto, California 94306
Attn: Patrick A. Pohlen, Esq.
Fax: (650) 857-0663
Any Party may, by written notice to the other, designate a new address
or fax number to which notices to the Party giving the notice shall thereafter
be mailed or faxed.
14.2 FORCE MAJEURE. No Party shall be liable for any delay or failure
of performance to the extent such delay or failure is caused by circumstances
beyond its reasonable control and that by the exercise of due diligence it is
unable to prevent, provided that the Party claiming excuse uses commercially
reasonable efforts to overcome the same.
14.3 ENTIRETY OF AGREEMENT. This Agreement embodies the entire, final
and complete agreement and understanding between the Parties and replaces and
supersedes all prior discussions and agreements between them with respect to its
subject matter. No modification or waiver of any terms or conditions hereof
shall be effective unless made in writing and signed by a duly authorized
officer of each Party.
14.4 NON-WAIVER. The failure of a Party in any one or more instances to
insist upon strict performance of any of the terms and conditions of this
Agreement shall not constitute a waiver or relinquishment, to any extent, of the
right to assert or rely upon any such terms or conditions on any future
occasion.
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14.5 DISCLAIMER OF AGENCY. Neither Party is, or will be deemed to be,
the legal representative or agent of the other, nor shall either Party have the
right or authority to assume, create, or incur any third Party liability or
obligation of any kind, express or implied, against or in the name of or on
behalf of another except as expressly set forth in this Agreement.
14.6 SEVERABILITY. If a court of competent jurisdiction declares any
provision of this Agreement invalid or unenforceable, or if any government or
other agency having jurisdiction over either Rigel or Novartis deems any
provision to be contrary to any laws, then that provision shall be severed and
the remainder of the Agreement shall continue in full force and effect. To the
extent possible, the Parties shall revise such invalidated provision in a manner
that will closely approximate the Parties' original intent.
14.7 AMBIGUITIES. The Parties hereby acknowledge that they have drafted
this Agreement jointly. Thus, any presumption that ambiguous provisions shall be
construed against the party drafting an agreement is inapplicable, and each
Party expressly agrees not to invoke said presumption in the event of a dispute
between the Parties relating to this Agreement.
14.8 AFFILIATES; ASSIGNMENT. Except as otherwise provided herein,
neither Party may assign its rights or delegate its duties under this Agreement
without the prior written consent of the other Party, not to be unreasonably
withheld; provided, however, that either Party may assign this Agreement to any
of its Affiliates or to any successor by merger or sale of substantially all of
the assets or business unit to which this Agreement relates; provided further,
however, that any such assignment shall be made in a manner such that the
assignee expressly undertakes in writing to be liable and responsible for the
performance and observance of all its duties and obligations hereunder. This
Agreement shall be binding upon the successors and permitted assigns of the
Parties. Any attempted delegation or assignment not in accordance with this
Section 14.7 shall be of no force or effect.
14.9 HEADINGS. The headings contained in this Agreement have been added
for convenience only and shall not be construed as limiting.
14.10 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be an original and all of which shall
constitute together the same document.
22.
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IN WITNESS WHEREOF, the Parties hereto have duly executed this Agreement.
RIGEL PHARMACEUTICALS, INC. NOVARTIS PHARMA AG
By: /s/ James M. Gower By: /s/ Paul Herring
------------------------------- --------------------------------
Name: James M. Gower Name: Dr. Paul Herring
----------------------------- ------------------------------
Title: President & CEO Title: Head of Research
---------------------------- -----------------------------
23.
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EXHIBIT A-1
T-CELL PROGRAM OF RESEARCH
<PAGE>
NOVEL REGULATORY PATHWAYS IN T AND B LYMPHOCYTES
NOVARTIS PROJECT OUTLINE
PROJECT I: IDENTIFICATION OF REGULATORY PROTEINS THAT
AFFECT T CELL ACTIVATION
INTRODUCTION
Activation of specific signaling pathways in lymphocytes determines
the quality, magnitude and duration of immune responses. In transplantation,
acute and chronic inflammatory diseases, and autoimmunity, it is these
pathways that are responsible for the induction, maintenance and exacerbation
of disease lymphocyte responses. Of the many activation pathways that have
been elucidated, most are ubiquitous and not unique to a particular cell
lineage. The goal of this proposal is to identify and validate novel
signaling molecules specific for T cell activation and effector function.
From these molecules, T cell-specific targets will be identified that are
effective in modulating immune-mediated processes. A combination of high
throughput functional and yeast two-hybrid genetic screens will be employed
to isolate and map novel signaling molecules in lymphocyte activation.
Engagement of the B cell receptor (BCR) in conjunction with T cell assistance
stimulates humoral immunity characterized by immunoglobulin production and
antigen presentation by B cells. Likewise, T cell signaling through the T
cell receptor (TCR) and other molecules such as CD28 leads to specific
cellular immunity. Summarized below, in Table 1, is our strategy for
identifying and validating novel T cell intracellular signaling molecules.
Each approach, its readout, and the libraries to be used are detailed in the
remaining sections of the proposal.
1.
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TABLE 1. SUMMARY OF SCREENS TO IDENTIFY INTRACELLULAR REGULATORS OF LYMPHOCYTE
ACTIVATION AND/OR EFFECTOR FUNCTION.
--------------------------------------------------------------------------------
INTRACELLULAR TARGETING
APPROACH READOUT STRUCTURES AND MOTIFS
--------------------------------------------------------------------------------
PROJECT I
IDENTIFICATION OF
REGULATORY PROTEINS THAT
AFFECT T CELL ACTIVATION
--------------------------------------------------------------------------------
1. PRIMARY SCREENS
--------------------------------------------------------------------------------
1.1 Primary peptide Enrichment by FACS for GFP/BFP scaffold peptide
screen for inhibition of absent or decreased CD25 libraries (12 mer and 18
CD25 (IL-2R(alpha) chain) expression (measured by mer)
in a cell line (to be (alpha) -CD25 monoclonal
determined by the RMC) antibody) Potential additional
stimulated through CD3 library scaffolds
+/-CD28 Enrichment by FACS for (constrained 18 mer
absent or decreased (beta)- lactamase, DHFR)
1.2 Primary peptide reporter activity to be determined by the
screen for inhibition of (fluorescence-based RMC
IL-2 promoter activity in screen) or isolation of
a cell line stimulated survivors (survival-based
through CD3 +/-CD28 screen)
--------------------------------------------------------------------------------
2. SECONDARY ASSAYS
--------------------------------------------------------------------------------
2.1 Secondary assays Analytical flow cytometry
measuring expression of measuring expression of
cell surface T cell CD28, CTLA-4, ICOS,
co-stimulatory molecules CDw150 and CD40L
in T cell lines (to be (additional markers to be
determined by the RMC) and determined by the RMC)
primary human PBL T cells
stimulated through CD3 Analytical flow cytometry
+/-CD28 measuring expression of
Th1/Th2 differentiation
2.2 Secondary assays markers to be determined
measuring T cell by the RMC (e.g., (beta)
differentiation into Th1 subunits of IL-12 and
and Th2 cells in T cell IFN(gamma) receptors,
lines (to be determined by ESTE-2, IL-12R(alpha),
the RMC) and primary human CD45RA, CD45RO and CD148)
PBL T cells; stimulus to
be determined by the RMC
--------------------------------------------------------------------------------
3. PATHWAY MAPPING
--------------------------------------------------------------------------------
3.1 Yeast two-hybrid Lac Z+, His cDNA:
screens on cDNA and -Anti-CD3
peptide hits to identify activated T cells from
intracellular binding human spleen
partners; functional
analysis of interacting
proteins
--------------------------------------------------------------------------------
3.2 Yeast-Two Hybrid Lac Z+, His+ Constrained 18 mer and
isolation of peptides that other scaffolds
bind to functional cDNAs; (GFP/BFP,
(beta)-lactamase, DHFR)
to be
--------------------------------------------------------------------------------
2.
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--------------------------------------------------------------------------------
functional analysis of determined by the RMC
these peptides
--------------------------------------------------------------------------------
PROJECT I.
IDENTIFICATION OF REGULATORY PROTEINS THAT AFFECT T CELL ACTIVATION.
1 Primary Screens
Screens in Project I will isolate inhibitors/modulators of TCR-induced T
cell activation (Appendix A). CD25 and IL-2 are such fundamental markers of
activated T cells that their upstream regulators may also be biased toward T
cell co-stimulation and/or Thl/2 development. Blockade of the above markers will
negatively affect T cell function and B-T cell interactions leading to T cell
activation. Modulating T cell activation and function has clinical relevance for
transplantation, autoimmunity and inflammatory diseases.
1.1 Primary peptide screen for inhibition of CD25 in T cells stimulated through
CD3 +/-CD28
CD3 positive T cell lines will be selected for their ability to upregulate
CD25 and produce IL-2 in response to crosslinking of their TCR. The cell lines
selected for primary screening will possess kinetics and levels of expression
of the above markers that are most similar to primary human peripheral blood
and splenic T cells. In primary screens, CD25 will be measured by flow cytometry
and enriched for desired phenotypes following peptide library expression. The T
cell lines will each be infected with 4 peptide libraries: two loop-3 BFP
scaffold peptide libraries (12 mer and 18 mer) and two loop-4 BFP scaffold
peptide libraries (12 mer and 18 mer. Other library scaffolds may be utilized as
deemed necessary by the RMC (constrained 18 mer, (beta)-lactamase, DHFR). After
several rounds of enrichment, individual peptide sequences will be tested for
function in the original screening assay.
1.2 Functional screening for inhibitors of TCR-induced transcription of the IL-2
promoter in cell lines carrying the IL-2 promoter upstream of a reporter fused
to death genes.
An alternative method for the flow-based screen described in section
1.1 is to generate cell lines that monitor IL-2 promoter activity by
survival. A CD3-responsive fragment of the IL-2 promoter will be cloned into
a retroviral vector in the reverse orientation. This will be upstream of a
splice site followed by a reporter (GFP) and then an IRES ending with a
fusion of two death genes, thymidine kinase (TK) and cytosine deaminase (CD)
(Appendix B). This construct will be packaged and used to infect the
CD3-responsive T cell lines. In response to activation of the IL-2 promoter,
the infected cells will become fluorescent or, after addition of the death
ligand (ganciclovir for TK and 5-FC (fluorocytosine) for CD), will die. These
reporter/survival T cell lines will be infected with 4 libraries: two loop-3
BFP scaffold peptide libraries (12 mer and 18 mer) and two loop-4 BFP
scaffold peptide libraries (12 mer and 18 mer). Other library scaffolds may
be utilized as deemed necessary by the RMC (constrained 18 mer, (beta)
lactamase, DHFR). Peptides capable of inhibiting promoter activity will
decrease GFP expression. Peptides capable of shutting off the promoter will
rescue the cells from death in the presence of the death gene inducers. After
sufficient rounds of enrichment, individual peptide sequences will be tested
for function in the original screening assay. This reporter/survival strategy
is adaptable to any promoter that is inducible by an extracellular signal. As
proof of principle, we have generated cell lines expressing TK,
3.
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CD8/CD95 and TK/GFP fusion that are efficiently killed in the presence of
ganciclovir or anti-CD8 monoclonal antibody, respectively (Appendix C).
2. SECONDARY ASSAYS
2.1 Secondary assays measuring expression of cell surface T cell co-stimulatory
molecules in T cell lines and primary human PBL T cells stimulated through CD3
+/-CD28
Confirmed peptide hits from the primary functional screens will be
subjected to secondary assays in T cell lines and primary peripheral blood and
splenic T cells. In these assays, the effects of the hits on CD3-induced
co-stimulation will be tested. Markers associated with T cell co-stimulation
will be assessed by analytical flow cytometry for their modulation by the
primary peptide hits. The markers that will be analyzed are CD28, ICOS, CTLA-4,
CDwl50 and CD40L (other markers may be added as deemed appropriate by the RMC).
Peptides that demonstrate desirable characteristics will be used as bait in a
genetic yeast two-hybrid screen to isolate their intracellular binding partner.
These cDNAs will be validated by a number of assays to test whether they
directly regulate T cell co-stimulation or not. Figure I summarizes the
interrelationship of the various methods described above to map functional
targets in T cell activation.
FIGURE 1
DIAGRAM
2.2 Secondary assays measuring T cell differentiation into Th1 and Th2 cells in
T cell lines and primary human PBL T cells
Confirmed peptide hits from the primary functional screens will be
subjected to secondary assays in T cell lines and primary peripheral blood and
splenic T cells. In these assays, the effects of the hits on Th1/2 development
will be tested. Markers associated with Th1/2 development will be assessed by
analytical flow cytometry for their modulation by the primary peptide hits. The
markers that will be analyzed are IL-12R-alpha and beta-2 chains,
IFN-gamma-R-beta chain, ESTE-2, CD45RA, CD45RO and CD148 (other markers may be
added as deemed appropriate by the RMC). Peptides that demonstrate desirable
characteristics will be used as bait in a genetic yeast two-hybrid screen to
isolate their intracellular binding partner. These cDNAs will be validated by a
number of assays to test whether they directly regulate Th1/2 development or
not. Figure 1 summarizes the interrelationship of the various methods described
above to map functional targets in T cell activation.
4.
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EXPERIMENTAL DESIGN AND METHODS
PROJECT I.
IDENTIFICATION OF REGULATORY PROTEINS THAT AFFECT T CELL ACTIVATION.
RATIONALE:
T cells are pivotal in determining the type of immune response and its
duration. Alterations in T cell activation and regulation are implicated in
numerous diseases such as acute and chronic inflammation, autoimmunity and graft
rejection. The screens in this approach will identify T cell activation-specific
signaling molecules and assess their bias towards co-stimulation and/or Thl/2
development. This will permit specific intervention into T cell-mediated
processes that contribute to or are the basis of disease.
1. PRIMARY SCREENS.
1.1 Primary peptide screen for inhibition of CD25 in T cells stimulated through
CD3+/-CD28
Several T cell lines, including MOLT, Jurkat, Hut-102, Hut-78 and those to
be determined by the Novartis - Rigel Joint Research Committee, will be tested
for the presence of surface CD3. Those that express CD3 will be cultured with
anti-CD3 to crosslink the TCR and test for the upregulation of CD25 and
production of IL-2 (Appendix A). It is important that the kinetics and levels
of expression of these markers overlap those observed in anti-CD3 stimulated
primary human T cells.
PEPTIDE LIBRARY SCREENING AND PROTEIN TARGET IDENTIFICATION.
Cell lines selected as described above will be infected with one of 4
peptide libraries containing random 12 or 18 mer peptides on loop 3 or 4 of a
BFP scaffold. Each of the peptide libraries will be packaged into infectious
viral particles (for protocol, see Appendix E). Each library sequence will be
upstream of a reporter gene to identify and/or select for infected cells and
relative peptide expression (Appendix F). Likewise, for hit confirmation, each
individual peptide sequence will be engineered into the same retroviral vectors
upstream of a reporter gene.
We have developed several retroviral constructs to control all aspects of
peptide expression and localization. This gives us great flexibility when
designing retroviral libraries within any cell line and with whatever
characteristics are deemed necessary for intracellular peptide expression (see
Appendix G). Constrained peptides have many valuable features compared to linear
peptides, including enhanced resistance to proteolysis and a restricted
conformation space that can result in a higher binding affinity for cognate
binding proteins.
Each screen will start with production of the primary retrovirus
peptide library. The primary library will be used to infect 10(8) to 10(9) T
cells. After infection, the cells will be stimulated with anti-CD3 and, two
days later, those cells containing a library member (positive for the
fluorescent reporter) and inhibited for surface expression of CD25 will be
enriched by FACS. This enriched population will be subjected to biological
rescue to amplify and transfer the integrated peptide sequences to naive
cells. The process will be repeated
5.
<PAGE>
until significant alteration in the expression of CD25 is observed by FACS. At
this point, individual peptide sequences will be cloned and tested in the
original screening assay for their ability to alter phenotype.
It will take approximately 4-6 rounds of enrichment to identify individual
sequences capable of inhibiting TCR induction of CD25. For a discussion of the
statistics associated with enrichment, see Appendix H. The most important factor
that influences the number of enrichment rounds necessary to identify individual
peptide hits is the ratio between real positive hits in the original library and
heritable false positives. The frequency of real positive hits is dependent upon
the qualitative ability of the over-expressed library member to alter the
pathway of interest. Enrichment of real positive peptides becomes less efficient
with false positive rates above 2%. For this reason, great effort is placed in
developing robust cell lines.
To obtain phenotypic enrichment in the primary screens, the desired
phenotype must be transferred from the enriched library-infected population to a
naive population repetitively. Historically, we have used RT-PCR to rescue
library members from the phenotypically desirable cells of one round, generate a
new retroviral library and infect naive cells to enrich once again for the
desired altered cell phenotype. Although RT-PCR works, uneven amplification will
decrease overall amplification of real peptide hits from one round to another.
Additional rounds of library enrichment can overcome this overall decrease of
real hit amplification. However, to overcome the potential problems of RT-PCR
and for more efficient transfer of phenotype from one round to the next, we are
replacing RT-PCR amplification with a direct biological rescue (Appendix I).
Biological rescue involves direct transfer of recombinant retroviral inserts
from positively identified cell clones into naive cells for re-testing. By
supplying retrovirus proteins GAG-POL-ENV to library-enriched cells, integrated
proviral transcripts encoding putative peptide hits are selectively re-packaged
and secreted as new virions capable of infecting new cells. Positive cells can
be converted to retroviral producers by superinfection of GAG-POL-ENV genes or
alternatively, tetracycline-inducible packaging functions can be pre-engineered
into target cell lines. By either strategy, peptides from enriched cells can be
selectively transferred to new cells and re-tested for phenotypic effects,
eliminating the time-intensive and potentially biased intermediary molecular
cloning steps. Proof of principle demonstrating the feasibility of this approach
is shown in Appendix J.
1.2 Functional screening for inhibitors of TCR-induced transcription of the IL-2
promoter in cell lines carrying the IL-2 promoter upstream of a reporter fused
to death genes
An alternative to the flow-based screens outlined above is to generate
cell lines that survive when promoters critical to T cell activation are
inhibited. This is a very stringent assay with very low background. This is
accomplished by infecting CD3-inducible T cell lines with the following
construct: A retroviral vector containing a TCR-responsive fragment of the
IL-2 promoter in the reverse orientation followed by a splice site, a
reporter gene such as GFP, an IRES and finally a fusion of two death genes,
TK and CD (Appendix B). The determination of the appropriate death genes to
use will be dependent on which is most robust in the particular T cell line
chosen. Briefly, cells will be infected with the reporter/death gene
construct and induced with anti-CD3. Cells expressing higher levels of GFP
will then be enriched by FACS. The anti-CD3 will be removed and the cells
will be enriched for absent or decreased reporter fluorescence.
Alternatively, pools of infected cells are divided and grown in parallel so
that one set can be induced and tested for GFP/death
6.
<PAGE>
gene induction without having to subject its sibling to TCR engagement. This
will control for any lasting effect TCR engagement may have on the GYP reporter
and the fused death genes.
The method will be as follows: The survival cell lines from above are
infected with the desired library (Appendix E). Leaky cells (constitutive
expression of the IL-2 promoter) are not a concern since the addition of the
second signal is required to kill cells. The second signal will be withheld
until the library has had time to express allowing all possible promoter
inhibitors to manifest. Two days after library infection, the cells are induced
with anti-CD3 in the presence of the appropriate death signal (ganciclovir for
TK and 5-FC for CD). Cells carrying peptides that inhibit induction of the
engineered IL-2 promoter fragment will not produce the death genes and will
survive. After the survivors grow out (approximately 1 week), they will again be
subjected to anti-CD3 and the death signals. The genes encoding the peptides
responsible for the survivors will be transferred to naive cells by biological
rescue as previously described (section 1.1). The identification of individual
inhibitory peptides should occur in only 3-4 rounds since the false positive
background for survival screens is lower than for FACS-based screening. Once
enrichment is achieved and individual sequences are independently shown to
inhibit IL-2 promoter activation, these sequences will be introduced into a
standard set of secondary and orthogonal assays as described below in section 2.
As well, the proteins they interact with will be identified as discussed in
section 3 below.
2 SECONDARY ASSAYS TO ASSESS PHYSIOLOGIC CHARACTERISTICS AND SPECIFICITY OF
PRIMARY FUNCTIONAL PEPTIDE HITS.
2.1 Secondary assays measuring expression of cell surface T cell co-stimulatory
molecules in T cell lines and primary human PBL T cells stimulated through CD3
+/-CD28
After library enrichment, individual sequences shown to modulate CD25
expression or IL-2 promoter activation will be introduced into a standard set of
secondary assays. The overall aim of these assays is to test the specificity and
physiologic characteristics of the functional peptide hits. This will be a
critical step in determining priority of hits for more intensive investigation.
Many of these assays will be performed in T cell lines and primary peripheral
blood or splenic T cells. The ability of the hits to alter anti-CD3 induced
expression of co-stimulatory molecules will be measured. These include but are
not limited to CD28, ICOS, CTLA-4 CDwl50 and CD40L. Functionally validated
peptide hits will then be used as bait to isolate their interacting protein
targets by genetic (yeast two-hybrid) screening technologies (see section 3 for
yeast two-hybrid details). These new interacting partners can be cycled into the
functional assays to assess their specific role in T cell signaling. In this
manner, activation pathways that mediate multiple functions in T cells can be
deconvoluted in a step-wise manner.
2.2 Secondary assays measuring T cell differentiation into Th1 and Th2 cells in
T cell lines and primary human PBL T cells
Just as described above in section 2.1, peptide hits from the primary
screens will be tested for their ability to influence Thl/2 development. CD3
activation combined with the presence of the appropriate cytokines will bias T
cells towards Thl or Th2 development. Cell surface markers such as IL-12R
(alpha) and (beta)2 chains, IFN-(gamma)R (beta) chain, ESTE-2, CD45RA, CD45RO
and CD148 have been shown to be associated Thl/2 development. The peptide hits
will be assessed for their ability to modulate these markers. They will also be
tested for their
7.
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ability to alter the secretion of cytokines associated with Thl (IFN-(gamma))
and Th2 responses (IL-4).
Functionally validated peptide hits will then be used as bait to isolate
their interacting protein targets by genetic (yeast two-hybrid) screening
technologies (see section 3 for yeast two-hybrid details). These new interacting
partners can be cycled into the functional assays to assess their specific role
in T cell signaling. In this manner, activation pathways that mediate multiple
functions in T cells can be deconvoluted in a step-wise manner.
PROJECT I - PATHWAY MAPPING.
FUNCTIONAL MAPPING OF NOVEL T CELL SIGNALING PROTEINS.
3.1 Yeast two-hybrid screening, to identify and map proteins that interact with
functional peptide hits.
Peptides that modulate lymphocyte activation do so by binding to
intracellular proteins that are members of signal transduction pathways which
ultimately lead to diverse phenotypic endpoints in T cells. Identification of
functional peptide-target protein pairs in these pathways will enable subsequent
screening for low molecular weight compounds that alter T cell function.
Priority peptide hits from the library screens that alter lymphocyte
activation will be subjected to yeast two-hybrid screening to identify their
intracellular binding partners. The libraries to be screened are described in
section 1 above. The screening protocol for identification of interacting
proteins is summarized in Appendix D. Briefly, sequences encoding the target
peptides will be cloned into pAS2-1K to fuse to the C-terminal of GAL4 DNA
binding domain. The oligos can also be cloned into pAS2N to fuse to the
N-terminal of GAL4 DNA binding domain. Both bait plasmids can be used for
subsequent screenings. The bait plasmids will be transformed into the Y190 yeast
strain. This yeast strain has the highest sensitivity for yeast two-hybrid
screening. Optimal 3AT concentration needed to suppress any HIS background
expression will be determined on SD-WH+3AT plates. The cDNA libraries will be
fused with the GAL4 activation domain and transformed into the yeast already
containing the bait plasmid. At least 20 million transformants from each library
will be screened on SD-LWH+3AT plates. HIS+ and LacZ+ clones will be grown up in
SD-L liquid medium to retrieve plasmid and for retransformation into Y190 to
verify the binding specificity.
Isolated proteins that are determined to interact with the functional
sequence baits will be tested for their ability to affect T cell activation in
the previously discussed secondary assays. The various ways to determine
function in the secondary assays is by simple overexpression of the putative
target protein and any potential dominant-negative domains, and random
mutagenesis to destroy functioning domains (Appendix K).
INITIAL STEPS FOR TARGET IDENTIFICATION/VALIDATION (SEE FLOWCHART IN
APPENDIX L).
It is important to recognize that once a target protein/peptide pair has
been identified, the relationship between that target protein and the pathway of
interest for that particular cell type is defined by virtue of the functional
screen that produced it. False positives arise only if the hit binds to
additional proteins not related to the functional pathway of interest. The
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binding peptide minimizes this possibility as it binds to only a portion of the
cDNA in a manner that regulates the pathway of interest. Below is a protocol to
discriminate false positives from pathway-specific protein/peptide target pairs.
Once the desired change in the phenotype of the library-infected cells is
achieved, the cDNAs/peptides responsible will be sequenced. Individual sequences
derived from the libraries, and subsequently two-hybrid approaches will be
tested for their ability to alter T or B cell activation as described earlier.
Targets are defined as functional cDNAs whose binding peptide can alter its
influence on lymphocyte activation in a desired way.
The protein/peptide pairs can be subjected to numerous secondary assays to
confirm their role and specificity in lymphocyte activation/regulation. The type
of protein/peptide pairs identified will dictate the exact assays performed.
These assays include over-expression in lymphocytes of the target protein, their
individual functional domains, dominant negative mutants (large-scale
mutagenesis of specific cDNAs to generate libraries of "mutant targets," see
Appendix L) and anti-sense mRNA of the target protein sequence. The readouts
will include changes in the expression of activation-upregulated surface
proteins, cytokine production and proliferation as described in Section 1 and 2.
In addition, the ability to revert the phenotype of activated lymphocytes by
over-expressing the target protein in cells expressing the inhibitory binding
peptide will be tested. These assays will assist the Joint Novartis-Rigel
Research Committee in their determination of targets to be introduced into
Novartis small molecule compound screens. Below is a brief description of the
rationale and approach for each of the assays described above.
Over-expression of the target protein or individual functional domains may
modulate lymphocyte activation, thereby implicating the specific protein in one
of the activation-coupled intracellular regulatory pathways. This can be
accomplished very simply with Rigel's retroviral vector system. By using
reporter genes downstream of the cDNA-encoding the target protein or domain, we
can track infected cells and determine the relative production of the target
protein/domain. This will allow us to titrate its biological effect as a means
to confirm the target protein's role in lymphocyte activation. If overexpression
of the protein target influences T cell activation, mutant libraries of the
protein can then be screened for loss-of-function as described below.
Target proteins will be randomly mutated (see Appendix L) and screened in
the FACS assays described in Section 1 for mutant proteins that alter lymphocyte
activation. Two variations of this approach allow us to narrow our screen of
mutant target proteins. One variation is to perform mutagenesis on the target
cDNA and then subject the mutagenized target to a two-hybrid screen with the
cognate peptide as bait to identify mutants that no longer bind the peptide.
These mutant proteins can be tested for loss-of-function in mammalian cells.
Alternatively, the peptide can be chemically crosslinked to the target protein
to identify the region bound by the peptide using mass spectrometry.
Subsequently, the peptide-binding region of the target protein is randomly
mutated and the clones screened for their ability to inhibit lymphocyte
activation. The advantage of this variation is that the regulatory domain of the
target protein is identified.
A third approach to confirm the role of the target protein in lymphocyte
activation is to overcome peptide inhibition by overexpressing the target
protein. The screening cell lines are infected with the peptide and its target
protein where the target protein under the control
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of an inducible promoter such as tetracycline or metallothionein. When the
target protein is induced, its ability to outcompete inhibition by the peptide
can be tested.
Some or all of the above methods can be employed to confirm that a
protein/peptide pair, identified in the initial screen is functionally relevant.
Because of our retroviral technology virtually any strategy of intracellular
expression can be approached to verify protein/peptide target pairs in living
cells. It will be the task of the Joint Novartis-Rigel Research Committee to
determine which assays are necessary to sufficiently define a functional
protein/peptide pair for the next phase of development, specifically small
molecular weight compound screening.
10.
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HEADCOUNT
To run optimally, the T cell project (Project I) and the B cell project
(Project II) will each take 12 full-time Rigel FTEs. Listed here are the
scientists who would begin working on the T cell project:
DAVID FERRICK: Dr. Ferrick is the project director and is the primary
supervisor responsible for ensuring the project hits milestones and objectives
in a timely mariner. In addition, he is the head of Molecular and Cell Biology
and will supervise all aspects of the various constructs, library generation,
library enrichment steps, target validation, and target analysis. Also, he is
responsible for the supervision and data analysis resulting from the HTS FACS
analysis/sorting.
CHARLENE LIAO: Dr. Liao is the project leader and will coordinate all
communication between Rigel and Novartis. She will be responsible for the
development of all primary and secondary assays for the screens. She will
generate the IL-2 promoter survival cell lines and oversee their screening. She
is responsible for analyzing the function of individual peptide and protein hits
in cell lines and primary cells.
PEIWEN YU: Dr. Yu is a Scientist who is investigating functional T cell
targets and two-hybrid hits. She is involved in developing many of the
functional assays related to T cell function.
TBH: A Scientist is required to be in charge of retroviral library design
and production. He will be responsible for the generation of all peptide
libraries with their scaffold and localization sequences. He will perform
library rescue and the subsequent subcloning of the individual peptide hits. He
will also shuttle hits from the yeast two-hybrid screen to mammalian vectors for
post two-hybrid functional analysis.
S. SWIFT: S. Swift is the Senior Research Associate in charge of
retroviral production and tissue culture. She is responsible for conducting the
library screens, which involves the generation of the infectious library for
each round of enrichment screening and all aspects of tissue culture associated
with the screening effort. She is also coordinating and performing biological
rescue to transfer enriched peptide clones from one round to the next, as well
as RT-PCR isolation of individual peptide sequences.
G. MINTIER: G. Mintier is the Research Associate responsible for
retroviral vector design and testing. He will generate the retroviral constructs
to be used in all the screens. He will be responsible for performing the peptide
screens and conducting the rescue of the hits from those screens. He will be
involved in the screening for proteins that bind the peptide hits.
H. KHOSHNEVISAN: H. Khoshnevisan is a cell biology Research Associate
responsible for all the tissue culture work for the project. She maintains all
the different lymphocyte cell lines, the Phoenix packaging cell line, and the
sorted cell populations.
M. AUJAY: M. Aujay is the Research Assistant in charge of the sequencing
core. She will be responsible for all DNA sequencing on this project. This
includes sequencing of all rescued libraries to check for enrichment and
contamination, all verified peptide hits, and two-hybrid hits. She is also
responsible for managing the sequence database and all related
11.
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DNA bioinformatics of the project. She will coordinate the data entry into the
appropriate databases.
P. FALLON: P. Fallon is the Senior Research Associate in charge of the
high-speed flow cytometry core. He is responsible for setting-up and
implementing all the FACS-based assays. He will be responsible for adapting all
assays for FACS-based sorting. He will perform these assays and sort the library
hits. He will also supervise the FACS-associated bioinformatics for all the
screens.
B. HUANG: B. Huang is an Intracellular Pathway Mapping Manager in charge
of two-hybrid screening. She is responsible for setting up and carrying out all
the two-hybrid assays, analyzing and isolating full-length clones, and
generating the cDNA libraries.
D. HATRAN: D. Hatran is a molecular biology Research Associate in the
target identification group. He is responsible for all the support work on the
one- and two-hybrid analyses, including media prep, plate pouring, minipreps,
colony picking, gel analysis, and subcloning.
C. LAU: C. Lau is a Research Associate responsible for all the subcloning
of hits into expression vectors and execution of secondary assays to verify
function in primary cells. She will also perform various labor-intensive tasks
associated with the screening effort such as peptide rescue, library sequencing
and tissue culture.
12.
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APPENDIX A
[DIAGRAM]
13.
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APPENDIX B
[DIAGRAM]
14.
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APPENDIX C
[DIAGRAM]
15.
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APPENDIX D(1)
[DIAGRAM]
16.
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APPENDIX D (2)
[DIAGRAM]
17.
<PAGE>
APPENDIX E
PROTOCOL FOR TRANSFECTION OF PHOENIX CELLS AND INFECTION OF NONADHERENT TARGET
CELLS
[DIAGRAM]
DAY 1:
Seed Phoenix cells (Es or As) in 10cm plates at 5 x 10(6) cells in 6 ml
(DMEM + 10% FBS + Pen/Strep) per plate the day before transfection.
DAY 2:
Allow all reagents to reach room temperature 30 min. before starting. Add
50 mM chloroquine at 8 microl/plate (50 microM final) before preparing the
transfection solution.
Mix CaPO4 reagents in 15ml polypropylene tube:
per plate: 10 microg. DNA
122 microliter 2M CaCl(2)
876 microliter H20
1.0ml 2X HBS
Add 2X HBS and depress the expulsion button completely to bubble air
through the mix for 10 secs. Immediately add mixture gently dropwise to plate.
Incubate 3-8 hours.
Remove medium and replace with 6.0 ml DMEM-medium.
DAY 3:
Change medium again to 6.0 mls of medium optimal for the cells to be
infected. Move to 32(degree) C either in the morning or afternoon depending
on the Phoenix cell confluency and whether you will infect at 48 or 72 hrs
after transfection.
DAY 4 OR 5:
Collect virus supernatant from transfected plates (6.0 ml) into 50 ml
tubes and add protamine sulfate to a final concentration of 5 microg./ml.
Pass through a 0.45 micrometer filter.
Count target cells and distribute 10(7) cells per 10 cm plate transfected
to 50 ml tubes and pellet 5 min.
Resuspend each pellet of target cells in virus supernatant and transfer to
a 6 well plate at 1.0-1.2 ml per well.
Seal plate with parafilm and centrifuge at RT for 30-90 min. at 2500 RPM.
Remove parafilm and incubate plate over night at 37(degree)C.
18.
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DAY 5:
Collect and pellet each well of target cells. Resuspend in 3 ml medium and
transfer back to the same 6well plate.
Infection can be repeated by refeeding the Phoenix cells with 6ml fresh
medium and reinfecting the same cells again up to 3 times to increase % of cells
infected (for instance at 48, 56, and 72 hours)
DAY 7 OR DAY 8:
At 48 to 72 hrs. post infection, target cells are ready to analyze for
expression.
19.
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APPENDIX F
[DIAGRAM]
20.
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APPENDIX G
[DIAGRAM]
21.
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APPENDIX H
[DIAGRAM]
22.
<PAGE>
APPENDIX J
[DIAGRAM]
23.
<PAGE>
APPENDIX K
[DIAGRAM]
24.
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APPENDIX L (1)
[DIAGRAM]
25.
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APPENDIX L(2)
[DIAGRAM]
26.
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Rigel-Novartis Collaboration
[DIAGRAM]
27.
<PAGE>
EXHIBIT A-2
B-CELL PROGRAM OF RESEARCH
<PAGE>
Provisional Draft
NOVEL REGULATORY PATHWAYS IN T AND B LYMPHOCYTES
NOVARTIS PROJECT OUTLINE
PROJECT II: IDENTIFICATION OF REGULATORY PROTEINS THAT AFFECT
BCR-INDUCED IG PRODUCTION
INTRODUCTION
Activation of specific signaling pathways in lymphocytes determines the
quality, magnitude and duration of immune responses. In transplantation, acute
and chronic inflammatory diseases, and autoimmunity, it is these pathways that
are responsible for the induction, maintenance and exacerbation of disease
lymphocyte responses. Of the many activation pathways that have been elucidated,
most are ubiquitous and not unique to a particular cell lineage. The goal of
this proposal is to identify and validate novel (signaling) molecules specific
for B cell activation and effector function as potential pharmacological targets
for B cell inhibition. From these molecules, B cell-specific targets will be
identified that are effective in modulating immune-mediated processes. A
combination of high throughput functional and yeast two-hybrid genetic screens
will be employed to isolate and map novel (signaling) molecules essential for
lymphocyte activation. Engagement of the B cell receptor (BCR) together with
additional activation principals stimulates humoral immunity characterized by
immunoglobulin production and antigen presentation by B cells. Summarized below,
in Table 1, are four strategies for identifying and validating novel B cell
intracellular signaling molecules. Each approach, its readout, and the libraries
to be used are detailed in the remaining sections of the proposal. Two of these
approaches (to be chosen by the Joint Novartis-Rigel Research Management
Committee) will be pursued initially.
PREFINAL DRAFT -- ELEMENTS YET TO BE FINALIZED
1.
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TABLE 1. SUMMARY OF SCREENS TO IDENTIFY INTRACELLULAR REGULATORS OF LYMPHOCYTE
ACTIVATION AND/OR EFFECTOR FUNCTION.
------------------------------------------------------------------------------------------------------------------------------
PROJECT II
IDENTIFICATION OF REGULATORY
PROTEINS THAT AFFECT BCR-
INDUCED IG PRODUCTION
------------------------------------------------------------------------------------------------------------------------------
APPROACH READOUT LIBRARY
------------------------------------------------------------------------------------------------------------------------------
1. PRIMARY SCREENS
------------------------------------------------------------------------------------------------------------------------------
1.1 SCREEN 1: Primary peptide screen Enrichment by FACS for decreased Puromycin and BFP loop3 scaffold
looking for signaling molecules expression of multiple B cell peptide libraries (12 mer and 18 mer)
involved in BCR activation as activation markers
measured by inhibition of B cell
activation marker up-regulation
1.2 SCREEN 2: Primary peptide screen Isolation of survivors and enrichment Potential additional libraries
for inhibitors of IgH chain promoter by FACS for absent or decreased (constrained 18mer, Beta-lactamase
activity in a B cell line stimulated reporter activity based, DHFR-based) to be determined
through the BCR by the RMC
1.3 SCREEN 3: Primary peptide screen Isolation of survivors and enrichment
for inhibitors of secretory Ig by FACS for absent or decreased
expression as measured by TK/GFP reporter activity
transgene in a mature B cell line
1.4 BACKUP SCREEN: Primary peptide Isolation of survivors
screen for signaling molecules
involved in BCR activation as
measured by apoptosis
------------------------------------------------------------------------------------------------------------------------------
2. SECONDARY ASSAYS
------------------------------------------------------------------------------------------------------------------------------
2.1 BCR-induced IG secretion in Secretion of Ig as measured by ELISA.
primary B cells and cell lines Production of Ig secretory transcript
as measured by PCR
2.2 A collection of BCR-induced (3)H-thymidine incorporation, FACS
proliferative responses in primary B for NFAT reporter gene assay and cell
cells and cell lines; Specificity of surface marker up-regulation, ELISA
hits in alternative cell types for Ig switching; T cell and
macrophage activation marker
expression
------------------------------------------------------------------------------------------------------------------------------
2.
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EXPERIMENTAL DESIGN AND METHODS
IDENTIFICATION OF REGULATORY PROTEINS THAT AFFECT B CELL ACTIVATION
1. Primary Screens
During xeno-transplantation, the initial hyperacute rejection is
predominantly mediated by complement and secretory Ig. Inhibition of secretory
Ig production may result in suppression of the rejection. Therefore, the primary
goal of our screen is to identify protein targets that are involved in the
pathways that lead to the production and secretion of Ig. Three different
primary screening strategies and a backup screen are proposed which have
distinctive advantages and disadvantages (Appendix A). The knowledge obtained
from these screens provides a comprehensive perspective on this complex and
intractable area in a manner not possible with any single approach.
1.1 Screen 1: Primary peptide screen looking for signaling molecules involved in
BCR activation as measured by inhibition of B cell activation marker
up-regulation.
RATIONALE:
The first approach involves screening peptides that directly inhibit the
up-regulation of multiple cell surface markers related to B cell signaling that
are upstream or connected to the Ig secretion pathway. This approach is based on
multiple marker sorting and can lead to the discovery of proliferative signaling
molecules in the BCR pathway:
CELL LINES, CONSTRUCTS, AND ACTIVATION MARKERS:
Four activation markers will initially be evaluated for their
up-regulation upon anti-Ig activation (e.g. CD69, IL-5R, surface Ig, MHC Class
II, and Ca2+ mobilization). Expression of the activation markers will be
optimized to ensure the lowest background, a critical factor in our inhibitory
peptide screens. It will also be important to ensure that the signaling event
triggered by FACS sorting is reversible so that multiple rounds of screening are
possible.
A panel of Ig+ mature B cell lines will be tested for their ability to
upregulate several key activation markers in response to BCR engagement. Those
with the greatest dynamic range of primary B cell activation will be employed in
the primary screens. The selected cell lines will then be infected with the
Tet-off transactivator tTA and TRE-LYT2 producing viruses (Appendix B). The
integration of the tTA plasmid will be selected by hygromycin; background of TRE
promoter and the expression of tTA will be selected according to LYT2
expression. High level of induction and low background of tTA activity will
determine the feasibility of the Tet-regulated system in the appropriate cell
line.
PEPTIDE LIBRARY SCREENING AND PROTEIN TARGET IDENTIFICATION:
Cell lines selected as described above will be infected with one of
Rigel's peptide libraries. We have developed several retroviral constructs to
control all aspects of peptide expression and localization. This gives us great
flexibility when designing retroviral libraries within any cell line and with
whatever characteristics are deemed necessary for intracellular peptide
expression (Appendix C). Constrained peptides have many valuable features
compared to linear peptides, including enhanced resistance to proteolysis and a
restricted
3.
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conformation space that can result in a higher binding affinity for cognate
binding proteins. In order to screen for as great a range of targets as
possible, three different libraries driven by the Tet-off, TRE promoter will be
used initially: two constrained libraries (a 12 mer and an 18 mer library
inserted at loop 3 of a BFP scaffold) and a linear library fused directly to a
puromycin resistance gene (18 mer). Dependent upon the results of the screens
using these libraries, the RMC may determine other library scaffolds should also
be utilized (e.g. constrained 18 mer, (beta)-1actamase based, enzyme based).
These primary libraries will be used to infect 10(8) to 10(9) B cells
(Appendix D) and the cells will be grown without Dox to allow peptide expression
(Appendix E). The cells will be stimulated with anti-Ig and selected for loss of
up-regulation of the cell surface markers. This population of cells contains
either inhibitory peptides or somatic mutations. To remove somatic mutations,
the cells will be grown out in the presence of Dox (peptide expression turned
off), followed by sorting for up-regulation of surface markers after stimulation
with anti-Ig. The GFP positive cells can then be funneled into multiple rounds
of selection, carried out by turning the peptides on and off until a definitive
peptide-dependent phenotype is obtained. After the final round of enrichment,
the GFP positive cells (peptide off) will be sorted into individual wells of
duplicate 96-well plates and treated +/- Dox. Peptide sequences from those cells
exhibiting the appropriate phenotype will then be isolated and transferred to a
naive population of cells. Their phenotype will be verified as being
peptide-dependent on an individual sequence basis.
This screen may have significantly higher background than the other
screens and, therefore, may take longer to identify hits. However, there is an
advantage in that inhibitors with complex phenotype can be isolated using this
approach.
1.2 Screen 2: Primary peptide screen for inhibitors of IgH promoter activity in
a mature B cell line stimulated through the BCR.
RATIONALE:
The effect of BCR activation on IgH production is two fold: the IgH
promoter activity is enhanced and there is an immediate increased production of
the secretory form of Ig. Inhibitors that block Ig(mu) promoter activity inhibit
an upstream event of all Ig production, which may or may not inhibit the
translational control of the pre-existing mRNA of Ig. However, in either case,
therapeutic targets identified which block Ig production will be relevant for
hyperacute rejection (minutes-hours). In addition, since antibody production is
considered to be important during chronic rejection (months-years), the targets
found in this screen may also be particularly useful in later stages of
rejection.
CONSTRUCTS AND CELL LINES:
In order to carry out the screen, an Ig+ mature B cell line that has
robustly enhanced activity of IgH promoter upon BCE signaling will be obtained.
A construct with a GFP/TK fusion driven by an IgH promoter will be used
(Appendix F). Regions of the IgH promoter that confer the lowest background and
the highest inducibility will be determined in the selected cell line. The
Tet-off transactivator will then be integrated into the chosen cell line as
described in Screen 1 (Section 1.1).
PEPTIDE LIBRARY SCREENING AND PROTEIN TARGET IDENTIFICATION:
4.
<PAGE>
Cell lines selected as described above will be infected with one of
Rigel's peptide libraries as described in screen 1.
These primary libraries will be used to infect 10(8) to 10(9) B cells. The
cells will be grown out in media without Dox, which allows for peptide library
expression (Appendix G). Cells will be stimulated with anti-Ig antibodies, and
selected in ganciclovir. Cells containing the TK reporter will be killed by the
ganciclovir unless a peptide inhibitor is present which inhibits the gene's
expression (Appendix H). The peptide-containing survivors will be enriched by
FACS for GFP negative cells (containing an inhibitor of the GFP reporter). This
will remove residual GFP-expressing cells that were not eliminated by the
ganciclovir. The cells that do not fluoresce will contain either peptides or
somatic mutations that inhibit alternative splicing or protein synthesis. To
remove the background caused by somatic mutations, the cells will be grown in
the presence of Dox (to turn off peptides) and (alpha) Ig allowing GFP/TK to
express. The GFP positive cells will be sorted into individual wells of a
96-well plate. Triplicate plates will be grown in different combinations of Dox
and ganciclovir to confirm that the phenotypic change is due to the peptide. The
peptides will then be isolated from those cells and transferred to a naive
population of cells where their phenotypes will be verified as being
peptide-dependent on an individual sequence basis.
1.3 Screen 3: Primary peptide screen for inhibitors of secretory Ig expression
as measured by TK/GFP transgene in a mature B cell line.
RATIONALE:
This strategy searches for inhibitors of Ig secretion and is the most
direct measure of the goal as defined in this proposal. This approach will
directly target the splicing step and translation of the IgH chain that is
responsible for generating the secretory form of Ig.
Increased promoter activity after BCR ligation and/or increased stability
of Ig(mu) mRNA in B cells are thought to be critical for the enhanced level of
RNA message. The understanding of the contributions of these two phenomena
during B cell development and immune responses has been elusive. However, this
approach should allow for the discovery of drug targets in either case.
CELL LINES AND CONSTRUCT:
Ig+ mature B cell lines will be tested for their ability to produce
secretory Ig. The most inducible cell line will be infected with a retroviral
construct containing a TK/GFP fusion gene inserted after (mu)4, the secretory
segment (S) and the puromycin resistance gene following the cytoplasmic exon
(Appendix I). Cells will be selected in puromycin to obtain a population that
contains stably integrated transgenes. Upon anti-Ig stimulation, GFP and TK
activity will reflect the expression of the secretory forms of Ig. Before
screening, the physiological nature of the BCR-induced splicing event in both
the endogenous and the transgene will be confirmed using PCR analysis. The tTA
expressing cell line will be generated as described in Screen 1.
PEPTIDE LIBRARY SCREENING AND PROTEIN TARGET IDENTIFICATION:
The screening protocol will be identical to that described in Screen 2
(Appendix G).
5.
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1.4 Back-up Screen: Primary peptide screen for inhibition of BCR signaling
measured by apoptosis in a mature or immature B cell line.
RATIONALE:
This screen is based on the assumption of cross-functionality between
proliferative and apoptotic pathway members and is presented as a back-up
strategy.
The outcome of BCR activation can be either apoptotic or proliferative,
depending on the concentration and binding affinity of the antigen, the
developmental stage of the B cells, and the coatimuli provided by T cells.
Current understanding indicates that great similarities exist between the death
and survival pathways. Based on this expectation of cross-functionality between
pathways, an apoptotic approach was used to identify several important molecules
in the TCR proliferative signaling pathway, including Lck, SLP-76 and LAT.
Similarly, the apoptotic screening strategy described here will allow a rapid
discovery of BCR signaling molecules that are involved Ig production and/or
secretion in a system with low background. Specific secondary assays will then
be used to confirm the cross functionality of the molecules in BCR-induced Ig
secretion and B cell proliferation.
CELL LINE:
A mature or immature B cell line will be identified by the RMC that is
efficiently induced to apoptose upon hypercross-linking or cross-linking with
different anti-Ig antibodies.
PEPTIDE LIBRARY SCREENING AND PROTEIN TARGET IDENTIFICATION:
The peptide scaffold for the primary libraries described in Screen 1 - 3
will be used to infect 10(8) to 10(9) B cells. Unlike the earlier screens;
however, these libraries will not be under Tet control. The cells will be
infected, allowed to express the peptide library, and stimulated with (alpha)-Ig
(Appendix J). The survivors, containing inhibitory peptides or somatic
mutations, will then be subjected to biorescue which transfers the peptide
sequences to a naive population of cells (method of transfer described below).
Multiple rounds of selection will be performed until the survival rate is
sufficiently greater than that of the control. Somatic mutants that survive the
initial selection will not be transferred when the peptides are reintroduced
into a naive population.
To obtain phenotypic enrichment in the primary screens, the desired
phenotype must be transferred from the enriched library-infected population to a
naive population repeatedly. Historically, we have used RT-PCR to rescue library
members from the phenotypically desirable cells of one round, then generated a
new retroviral library and infected naive cells to enrich once again for the
desired phenotype. Although this approach works, uneven amplification decreases
overall amplification of real peptide hits from one round to another. Additional
rounds of library enrichment can overcome this overall decrease of real hit
amplification. However, to avoid the potential problems of RT-PCR and for more
efficient transfer of phenotype from one round to the next, we are replacing
RT-PCR amplification with a direct biological rescue (Appendix K). Biological
rescue involves direct transfer of recombinant retroviral inserts from
positively identified cell clones into naive cells for re-testing. By supplying
retrovirus proteins gag-pol-env to library-enriched cells, integrated proviral
transcripts encoding putative peptide hits are selectively re-packaged and
secreted as
6.
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new virions capable of infecting new cells. Positive cells can be converted to
retroviral producers by superinfection of gag-pol-env genes or alternatively,
tetracycline-inducible packaging functions can be pre-engineered into target
cell lines. By either strategy, peptides from enriched cells can be selectively
transferred to new cells and re-tested for phenotypic effects, eliminating the
time-intensive and potentially biased intermediary molecular cloning steps.
Proof of principle demonstrating the feasibility of this approach is shown in
Appendix L.
It will take approximately 3-4 rounds of enrichment to identify individual
sequences capable of altering phenotype above background. For a discussion of
the statistics associated with enrichment, see Appendix M. The most important
factor that influences the number of enrichment rounds necessary to identify
individual peptide hits is the ratio between real positive hits in the original
library and heritable false positives. The frequency of real positive hits is
dependent upon the qualitative ability of the over-expressed library member to
alter the pathway of interest. Enrichment of real positive peptides becomes
less efficient with false positive rates above 2%. For this reason, great effort
is placed in developing robust cell lines.
2. SECONDARY ASSAYS TO ASSESS PHYSIOLOGIC CHARACTERISTICS AND SPECIFICITY OF
PRIMARY FUNCTIONAL PEPTIDE HITS.
2.1 Secondary assays measuring Ig secretion in B cell lines and primary human
PBL B cells stimulated through the BCR.
After library enrichment, individual sequences shown to modulate BCR
signaling and/or Ig secretion will be introduced into a standard set of
secondary assays. The overall aim of these assays is to test the specificity and
physiologic characteristics of the functional peptide hits. This will be a
critical step in prioritizing hits for more intensive investigation. These
assays will be performed in B cell lines and primary peripheral blood or splenic
B cells. Of primary importance will be the ability of the hits to alter anti-Ig
induced Ig secretion either by directly inhibiting secretion or indirectly by
blocking activation events leading to Ig secretion. Inhibition of Ig by the hits
will be measured by ELISA in both cell lines and primary human B cells. For
further confirmation and to assess the mechanism of inhibition, the hits will be
tested for their ability to block the alternative splicing of the secretory Ig
transcript measured by PCR analysis. The block of the Ig secretory pathway will
also be measured by western analysis for the cytoplasmic retention of the
smaller form of the Ig heavy chain.
Functionally validated peptide hits will then be used as bait to isolate
their interacting protein targets by genetic (yeast two-hybrid) screening
technologies (see section 3 for yeast two-hybrid details). These new interacting
partners can be cycled into the functional assays to assess their specific role
in Ig secretion. In this manner, activation pathways that mediate multiple
functions in Ig secretion can be deconvoluted in a step-wise manner.
2.2 Additional assays to further characterize the specificity of hits that block
Ig secretion.
In addition to secondary assays directly targeting Ig secretion, a
combination of generic assays for BCR proliferative responses will also be used
to clarify the role or mechanism of the primary hits that block Ig secretion.
Such assays (to be determined by RMC) may include calcium influx, 3H-thymidine
incorporation, NFAT reporter gene assay,
7.
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cell surface marker up-regulation markers (such as IL-1R, IL-2R, IL-6R, CD10,
CD23, and CD25), and Ig switching. In addition, the specificity of the hits will
be assessed based upon their ability to inhibit TCR-mediated T cell activation,
as well as LPS-induced macrophage activation.
Peptide hits validated in these activation, proliferation, and specificity
assays will be cycled into yeast two-hybrid screens as described in section 2.1
and section 3.1.
PATHWAY MAPPING.
FUNCTIONAL MAPPING OF NOVEL B CELL SIGNALING PROTEINS.
3.1 Yeast two-hybrid screening to identify and map proteins that interact with
functional peptide hits.
Peptides that modulate lymphocyte activation do so by binding to
intracellular proteins that are members of signal transduction pathways which
ultimately lead to diverse phenotypic endpoints in B cells. Identification of
functional peptide-target protein pairs in these pathways will enable subsequent
screening for low molecular weight compounds that alter T and B cell function.
Priority peptide hits from the library screens that alter BCR signaling
will be subjected to yeast two-hybrid screening to identify their
intracellular binding partners (Appendix N). The libraries to be screened
will be derived from various populations of B cells. The screening protocol
for identification of interacting proteins is summarized in Appendix O.
Briefly, sequences encoding the target peptides will be cloned into pAS2-1K
to fuse to the C-terminal of GAL4 DNA binding domain. The sequences can also
be cloned into pAS2N to fuse to the N-terminal of GAL4 DNA binding domain.
Both bait plasmids can be used for subsequent screenings. The bait plasmids
will be transformed into the Y190 yeast strain. This yeast strain has the
highest sensitivity for yeast two-hybrid screening. Optimal 3AT concentration
needed to suppress any HiS background expression will be determined on
SD-WH+3AT plates. The cDNA libraries will be fused with the GAL4 activation
domain and transformed into the yeast already containing the bait plasmid. At
least 20 million transformants from each library will be screened on
SD-LWH+3AT plates. HIS+ and LacZ+ clones will be grown up in SD-L liquid
medium to retrieve plasmid and for retransformation into Y190 to verify the
binding specificity.
Isolated proteins that are determined to interact with the functional
sequence baits will be tested for their ability to affect BCR signaling in
the previously discussed secondary assays. The various ways to determine
function in the secondary assays is by simple overexpression of the putative
target protein and any potential dominant-negative domains, and random
mutagenesis to destroy functioning domains (Appendix P).
INITIAL STEPS FOR TARGET IDENTIFICATION/VALIDATION (SEE FLOWCHART IN
APPENDIX Q1 AND Q2).
It is important to recognize that once a target protein/peptide pair has
been identified, the relationship between that target protein and the pathway of
interest for that particular cell type is defined by virtue of the functional
screen that produced it. False positives arise only if the hit binds to
additional proteins not related to the functional pathway of interest. The
8.
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binding peptide minimizes this possibility as it binds to only a portion of the
cDNA in a manner that regulates the pathway of interest. Below is a protocol to
discriminate false positives from pathway-specific protein/peptide target pairs.
Once the desired change in the phenotype of the library-infected cells is
achieved, the cDNAs/peptides responsible will be sequenced. Individual sequences
derived from the libraries, and subsequently two-hybrid approaches will be
tested for their ability to alter B cell activation as described earlier in
Sections 1 and 2. Initial targets are defined as functional cDNAs whose binding
peptide can alter its influence on lymphocyte activation in a desired way.
The protein/peptide pairs can be subjected to numerous secondary assays to
confirm their role and specificity in lymphocyte activation/regulation. The type
of protein/peptide pairs identified will dictate the exact assays performed.
These assays include over-expression in lymphocytes of the target protein, their
individual functional domains, dominant negative mutants (large-scale
mutagenesis of specific cDNAs to generate libraries of "mutant targets," see
Appendix P) and anti-sense mRNA of the target protein sequence. The readouts
will include changes in the expression of activation-up-regulated surface
proteins, antibody production, cytokine production and proliferation as
described in Section 1 and 2. In addition, the ability to revert the phenotype
of activated lymphocytes by over-expressing the target protein in cells
expressing the inhibitory binding peptide will be tested. These assays will
assist the RMC in their determination of targets to be introduced into Novartis
small molecule compound screens. Below is a brief description of the rationale
and approach for each of the assays described above.
Over-expression of the full-length target protein or individual
functional domains may modulate B cell activation, thereby implicating the
specific protein in one of the activation-coupled intracellular regulatory
pathways. This can be accomplished very simply with Rigel's retroviral vector
system. By using reporter genes downstream of the cDNA encoding the target
protein or domain, we can track infected cells and determine the relative
production of the target protein/domain. This will allow us to titrate its
biological effect as a means to confirm the target protein's role in
lymphocyte activation. If overexpression of the protein target influences
lymphocyte activation, mutant libraries of the protein can then be screened
for loss-of-function as described below.
Target proteins will be randomly mutated (see Appendix P) and screened in
the FACS assays described in Section 1 for mutant proteins that alter lymphocyte
activation. Two variations of this approach allow us to narrow our screen of
mutant target proteins. One variation is to perform mutagenesis on the target
cDNA and then subject the mutagenized target to a two-hybrid screen with the
cognate peptide as bait to identify mutants that no longer bind the peptide.
These mutant proteins can be tested for loss-of-function in mammalian cells.
Alternatively, the peptide can be chemically crosslinked to the target protein
to identify the region bound by the peptide using mass spectrometry.
Subsequently, the peptide-binding region of the target protein is randomly
mutated and the clones screened for their ability to inhibit lymphocyte
activation. The advantage of this variation is that the regulatory domain of the
target protein is identified.
A third approach to confirm the role of the target protein in lymphocyte
activation is to overcome peptide inhibition by overexpressing the target
protein. The screening cell lines are infected with the peptide and its target
protein where the target protein under the control
9.
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of an inducible promoter such as tetracycline or metallothionein. When the
target protein is induced, its ability to outcompete inhibition by the peptide
can be tested.
Some or all of the above methods can be employed to confirm that a
protein/peptide pair, identified in the initial screen is functionally relevant.
Because of our retroviral technology virtually any strategy of intracellular
expression can be utilized to verify protein/peptide target pairs in living
cells. It will be the task of the RMC to determine which assays are necessary to
sufficiently define a functional protein/peptide pair for the next phase of
development, specifically small molecular weight compound screening.
3.2 Additional levels of Yeast two-hybrid screening to identify and map proteins
that interact with the functional cDNA target
The functional cDNA targets identified in 3.1 that bind to the inhibitory
peptide will be used as bait to identify its binding partners. This second level
of yeast two-hybrid analysis will identify cDNA "ligands" for the target
proteins identified by the inhibitory peptides. These ligands will be assessed
in a variety of assess to confirm their role in the pathway leading to Ig
secretion and/or B cell activation as described in 3.1.
HEADCOUNT
To run optimally, the T cell project (Project I) and the B cell project
(Project II) will each take 12 full-time Rigel FTEs. Listed here are the
scientists who would begin working on the B cell project (see Appendix R for an
amended list of the scientists who will begin working on the T cell project):
YING LUO: Dr. Luo is the project director and is the primary supervisor
responsible for ensuring that the project hits milestones and objectives in a
timely fashion. In addition, he is the head of Genomics and Target Discovery and
is responsible for the supervision and data analysis resulting from YTH and HTS
FACS analysis/sorting. He will also supervise all aspects of the various
constructs, library generation, library enrichment steps, target validation, and
target analysis.
H. MANCEBO: H. Mancebo will coordinate all communication between Rigel and
Novartis. She will be responsible for the development of all primary and
secondary assays for the screens. She will generate the IgH promoter survival
cell lines and oversee their screening. She is responsible for analyzing the
function of individual peptide and protein hits in cell lines and primary cells.
C.A. FU: Dr. Fu is a Scientist who is investigating functional B cell
targets and two-hybrid hits. He is involved in developing many of the functional
assays related to B cell function.
TBH: A Scientist is required who will be in charge of retroviral library
design and production. The individual will be responsible for the generation of
all peptide libraries with their scaffold and localization sequences. He/she
will perform library rescue and the subsequent subcloning of the individual
peptide hits. The individual will also shuttle hits from the yeast two-hybrid
screen to mammalian vectors for post two-hybrid functional analysis.
10.
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A. FRIERA: A. Friera is the Senior Research Associate in charge of
retroviral production and tissue culture. She is responsible for conducting the
library screens, which involves the generation of the infectious library for
each round of enrichment screening and all aspects of tissue culture associated
with the screening effort. She is also coordinating and performing biological
rescue to transfer enriched peptide clones from one round to the next, as well
as RT-PCR isolation of individual peptide sequences.
C. YOUNG: C. Young is the Research Associate responsible for retroviral
vector design and testing. He will generate the retroviral constructs to be used
in all the screens. He will be responsible for performing the peptide screens
and conducting the rescue of the hits from those screens. He will be involved in
the screening for proteins that bind the peptide hits.
TBH: An additional cell biology Research Associate will be required who
will be responsible for all the tissue culture work for the project. He will
maintain all the different lymphocyte cell lines, the Phoenix packaging cell
line, and the sorted cell populations.
M. FOX: M. Fox is the Research Assistant in charge of the sequencing core.
He will be responsible for all DNA sequencing on this project. This includes
sequencing of all rescued libraries to check for enrichment and contamination,
all verified peptide hits, and two-hybrid hits. He will coordinate the data
entry into the appropriate sequence databases.
ALEX ROSSI: A. Rossi is a Cell Biology Manager responsible for setting-up
and implementing all the FACS-based assays. He will be responsible for adapting
all assays for FACS-based sorting. He will perform these assays and sort the
library hits. He will also supervise the FACS-associated bioinformatics for all
the screens.
M. SHEN: M. Shen is the Senior Research Associate in charge of two-hybrid
screening. She is responsible for setting up and carrying out all the two-hybrid
assays, analyzing and isolating full-length clones, and generating the cDNA
libraries
J. LASAGA: J. Lasaga is a molecular biology Research Associate in the
target identification group. He is responsible for all the support work on the
one- and two-hybrid analyses, including media prep, plate pouring, minipreps,
colony picking, gel analysis, and subcloning.
RESEARCH ASSOCIATE TBH: An additional molecular biology Research Associate
will be needed who will be responsible for all the subcloning of hits into
expression vectors and execution of secondary assays to verify function in
primary cells. This individual will also perform various labor-intensive tasks
associated with the screening effort such as peptide rescue, library sequencing
and tissue culture.
11.
<PAGE>
APPENDIX A
[DIAGRAM]
12.
<PAGE>
APPENDIX B
[DIAGRAM]
13.
<PAGE>
APPENDIX C
[DIAGRAM]
14.
<PAGE>
APPENDIX D
PROTOCOL FOR TRANSFECTION OF PHOENIX CELLS AND INFECTION OF NONADHERENT TARGET
CELLS
[DIAGRAM]
Day 1:
Seed phoenix cells (Es or As) in 10cm plates at 5 x 10E6 cells in 6 ml (DMEM +
10% FBS + Pen/Strep) per plate the day before transfection.
Day 2:
Allow all reagents to reach room temperature 30 min. before staring. Add 50 mM
chloroquine at 8 microliter/plate (50 microM final) before preparing the
transfection solution.
Mix CaPO4 reagents in 15 ml polypropylene tube:
Per plate: 10 micrograms DNA
122 microliters 2M CaCl2
876 microliters H2O
1.0ml 2X HBS
Add 2X HBS and depress the expulsion button completely to bubble air through the
mix for 10 secs. Immediately add mixture gently dropwise to plate. Incubate 3-8
hours.
Remove medium and replace with 6.0 ml DMEM-medium.
Day 3:
Change medium again to 6.0 mls of medium optimal for the cells to be infected.
Move to 32 degrees C either in the morning of afternoon depending on the Phoenix
cell confluency and whether you will infect at 48 or 72 hrs after transfection.
Day 4 or 5:
Collect virus supernatant form transfected plates (6.0 ml) into 50 ml tubes and
add protamine sulfate to a final concentration of 5 micrograms/ml. Pass through
a 0.45 microm filter. Count target cells and distribute 10(7) cells per 10cm
plate transfected to 50 ml tubes and pellet 5 min. Resuspend each pellet of
target cells in virus supernatant and transfer to a 6 well plate at 1.0-1.2 ml
per well. Seal plate with parafilm and centrifuge at RT for 30-90 min. at 2500
RPM. Remove parafilm and incubate plate over night at 37 degrees C.
Day 5:
Collect and pellet each well of target cells. Resuspend in 3 ml medium and
transfer back to same 6 well plate. Infection can be repeated by refeeding the
Phoenix cells with 6ml fresh medium and reinfecting the same cells again up to
3 times to increase % of cells infected (for instance at 48, 56, and 72 hours)
Day 7 or Day 8:
At 48 to 72 hrs. post infection, target cells are ready to analyze for
expression.
15.
<PAGE>
APPENDIX E
[DIAGRAM]
16.
<PAGE>
APPENDIX F
[DIAGRAM]
17.
<PAGE>
APPENDIX G
[DIAGRAM]
18.
<PAGE>
APPENDIX H
[DIAGRAM]
19.
<PAGE>
APPENDIX I
[DIAGRAM]
20.
<PAGE>
APPENDIX J
[DIAGRAM]
21.
<PAGE>
APPENDIX K
[DIAGRAM]
22.
<PAGE>
APPENDIX L
[DIAGRAM]
23.
<PAGE>
APPENDIX M
[DIAGRAM]
24.
<PAGE>
APPENDIX N
[DIAGRAM]
25.
<PAGE>
APPENDIX O
[DIAGRAM]
26.
<PAGE>
APPENDIX P(1)
[DIAGRAM]
27.
<PAGE>
APPENDIX P(2)
[DIAGRAM]
28.
<PAGE>
APPENDIX Q1 FLOW CHART FOR FUNCTIONAL SCREENS
(IDENTIFICATION OF TARGET PROTEIN/PEPTIDE PAIRS)
[DIAGRAM]
29.
<PAGE>
APPENDIX Q2
TARGET VALIDATION STEPS
[DIAGRAM]
30.
<PAGE>
RIGEL/NOVARTIS COLLABORATION TIMELINE
[DIAGRAM]
31.
<PAGE>
EXHIBIT B
NUMBER
OF COMMENCEMENT
PROJECT FTES DATE
B-1 T-Cell Project 12 Effective Date
B-2 B-Cell Project 12 To be determined
<PAGE>
EXHIBIT C
LICENCE TERMS UNDER ARTICLES 5.6 AND 6.4
1. DEFINITIONS:
For purposes of this Exhibit C the term
- "Direct Product" shall mean a product developed by Novartis based upon a
Rigel-supplied compound or a derivative thereof, the manufacture, use or
sale of which in the absence of a licence, would infringe a valid claim
(to be defined in a full agreement) of Rigel.
- "Indirect Product" shall mean a product developed by Novartis based upon a
Rigel-supplied compound or a derivative thereof and which is not a Direct
Product.
2. CONSIDERATION DUE FOR EACH DIRECT PRODUCT:
(A) LICENSE EXECUTION AND MILESTONE PAYMENTS
Upon execution of license $250,000
Upon start of Phase I Clinical Trials $500,000
Upon NDA submission $1,000,000
Upon NDA approval $2,000,000
(B) ROYALTIES ON ANNUAL NET SALES OF DIRECT PRODUCTS
DURING PATENT TERM*:
up to $300 Million 4%
on incremental sales from $300 Million to $500
Million 5%
on incremental sales from $500 Million to $750
Million 6%
on incremental sales from $750 Million to $1 Billion 7%
on incremental sales above $1Billion 8%
*subject to a deduction from royalty payments of an amount
corresponding to 50% of the milestone payments made to Rigel under
2(a), provided, that each royalty payment shall not be reduced by
more than 50% of the amount due prior to applying the milestone
payment credit
3. CONSIDERATION DUE FOR EACH INDIRECT PRODUCTS:
- License execution and milestone payments equal to 50% of the amounts set
forth in 2.(a) above for Direct Products;
- No royalties.
<PAGE>
EXHIBIT D
THIRD PARTY LICENSES
Agreement between the Board of Trustees of the Leland Stanford Junior University
and Rigel Pharmaceuticals, Inc. dated October 7, 1996
<PAGE>
AGREEMENT
Effective as of October 7, 1996 ("Effective Date"), THE BOARD OF TRUSTEES
OF THE LELAND STANFORD JUNIOR UNIVERSITY, a body having corporate powers under
the laws of the State of California ("STANFORD") and RIGEL PHARMACEUTICALS,
INC., a Delaware corporation having a principle place of business at 24 Windsor
Drive, Hillsborough, CA 94010 ("RIGEL"), agree as follows:
1. BACKGROUND.
1.1 STANFORD has an assignment of U.S. Patent Application No. 08/589,109,
entitled "Methods for Screening for Transdominant Effector Peptides and RNA
Molecules" (the "Nolan/Rothenberg Patent Application") claiming an invention
developed in the laboratory of Dr. Garry Nolan (the "Invention"), and any
Licensed Patent(s), as hereinafter defined, which may claim such Invention.
1.2 STANFORD has certain biological materials and other know-how
("Know-How"), as herein defined, pertaining to the Invention.
1.3 STANFORD desires to have the Know-How and Invention perfected and
marketed at the earliest possible time in order that products resulting
therefrom may be available for public use and benefit.
1.4 RIGEL desires a license under said Know-How, Invention, and Licensed
Patent(s) in the field of use of gene transfer technologies, including
retrovirally mediated nucleic acid libraries, for drug development, drug
delivery, drug screening, and target analysis and discovery associated with the
development, manufacture, use and sale of Licensed product(s), as defined below.
1.5 RIGEL acknowledges that certain of the Cell Lines (as defined below)
were made in the course of research supported by Progenesys.
1.6 The patent application entitled "Methods for Screening for
Transdominant Intracellular Effector Peptides and RNA Molecules," which claims
technology useful in the field and which was developed in the laboratory of Dr.
Garry Nolan (the "Nolan Patent Application"), has previously been assigned to
RIGEL.
2. DEFINITIONS.
2.1 "LICENSED BIOLOGICAL MATERIALS" means the materials listed on Exhibit
A, including certain vector libraries ("Vector Libraries") and cell lines ("Cell
Lines") set forth therein, as amended from time to time upon the parties' mutual
written consent.
2.2 "LICENSED KNOW-HOW" means all know-how necessary or useful for the
commercial exploitation of the Licensed Patents in the Licensed Field of Use,
including without limitation all know-how, trade secrets, protocols,
information, processes or other subject matter which is either disclosed in the
Nolan/Rothenberg Patent Application, or necessary or useful to
1.
<PAGE>
practice the licenses granted to RIGEL in this Agreement with respect to the
Invention. Licensed Know-How excludes the Licensed Patents and includes the
Licensed Biological Materials.
2.3 "LICENSED PATENT(S)" means any Letters Patent, both foreign
(subject to Section 7) and domestic, issued upon (i) the Nolan/Rothenberg
Patent Application (STANFORD's U.S. Patent Application Serial Number
08/589,109, filed January 23, 1996), (ii) any substitutions, divisionals,
continuations, and continuations-in-part (to the extent such
continuations-in-part claim subject matter disclosed in the Nolan/Rothenberg
Patent Application as filed on January 23, 1996 and to the extent that the
practice of an invention claimed in a Licensed Patent issuing from a patent
application other than such continuation-in-part would infringe a claim of
Licensed Patent issuing from such continuation-in-part), and (iii) any
foreign counterparts of (i) or (ii).
2.4 "LICENSED TECHNOLOGY" means the Licensed Patent(s) and the Licensed
Know-How.
2.5 "LICENSED PRODUCT(S)" means:
(a) any product, the manufacture, use, sale, offer for sale or
import of which:
(1) is covered by a valid claim of an issued, unexpired
Licensed Patent(s) directed to the Invention (claim of an issued, unexpired
Licensed Patent(s) shall be presumed to be valid unless and until it has been
held to be invalid by a final judgment of a court of competent jurisdiction from
which no appeal can be or is taken), or
(2) is covered by any claim being prosecuted in a pending
application directed to the Invention, which claim has not been pending for more
than three (3) years from first filing of such claim;
(b) any product which directly incorporates any of the Licensed
Biological Materials; or
c) any product which would not, but for the use of the Licensed
Biological Materials, have been identified, discovered, or developed.
2.6 "NET SALES" means the gross revenue derived by RIGEL and/or RIGEL's
sublicensee(s) from the sales of Licensed Product(s), less the following items
but only insofar as they actually pertain to the disposition of such Licensed
Product(s) by RIGEL or RIGEL's sublicensee(s), are included in such gross
revenue, and are separately billed:
a) Import, export, excise and sales taxes, and custom duties;
b) Credit for returns, allowances, trades, or retroactive price
adjustments;
c) Transportation charges, issuances and allowances;
d) Discounts actually allowed; or
e) Royalties payable to third parties on the manufacture, use, sale,
offer for sale or import of Licensed Products.
2.7 "LICENSED FIELD OF USE" means the use of gene transfer technologies,
including retrovirally mediated nucleic acid libraries, for drug development,
drug delivery, and target
2.
<PAGE>
analysis and discovery. Solely with respect to the phiNX Cell Lines set forth on
Exhibit A, the Licensed Field of Use excludes the use of such Cell Lines,
derivatives or vectors thereof or other tangible products that are a direct
lineal descendent from such Cell Lines (although obtained in any manner
therefrom), wherein cells treated with any one or more of the aforementioned
materials are contained within a human subject or are subsequently transplanted
into a human subject.
2.8 "EXCLUSIVE" means that, subject to Article 4, STANFORD shall not grant
further licenses in the Licensed Field of Use.
3. GRANT.
3.1 STANFORD hereby grants and RIGEL hereby accepts a worldwide license in
the Licensed Field of Use under STANFORD's right, title and interest in the
Licensed Patents and the Vector Libraries to make, use, sell, offer for sale and
import Licensed Product(s).
3.2 The license granted in Section 3.1 is Exclusive, including the right
to sublicense pursuant to Article 13, in the Licensed Field of Use for a term
(the "Exclusivity Term") commencing as of the Effective Date and ending on the
first to occur of the following:
(a) twenty (20) years from the Effective Date; or
(b) ten (10) years from the date of first commercial sale of a
Licensed Product(s) by RIGEL or RIGEL's sublicensee(s). RIGEL agrees to promptly
inform STANFORD in writing of the date of first commercial sale of Licensed
Products. After expiration of the Exclusivity Term, said license shall become
nonexclusive and continue indefinitely.
3.3 STANFORD additionally grants, and RIGEL hereby accepts, a worldwide,
nonexclusive license in the Licensed Field of Use under STANFORD's right, title
and interest in the Licensed Know-How other than the Vector Libraries to make,
use, sell, offer for sale and import Licensed Product(s). The term of such
nonexclusive license shall commence upon the Effective Date and continue
indefinitely.
3.4 Notwithstanding the Exclusive license granted to RIGEL pursuant to
Sections 3.1 and 3.2, STANFORD shall have the right to practice the Licensed
Patents and to use the Vector Libraries for non-commercial, academic research
purposes.
4. GOVERNMENT RIGHTS.
This Agreement is subject to all of the terms and conditions of Title 35
United States Code Sections 200 through 204, including an obligation that
Licensed Product(s) sold or produced in the United States be "manufactured
substantially in the United States," and RIGEL agrees to take all reasonable
action necessary on its part as licensee to enable STANFORD to satisfy its
obligation thereunder, relating to the Invention. STANFORD agrees to provide
reasonable assistance to RIGEL in the event RIGEL decides to seek a waiver under
such domestic manufacture requirement.
3.
<PAGE>
5. DILIGENCE.
5.1 As an inducement to STANFORD to enter into this Agreement, RIGEL
agrees to use all reasonable efforts and diligence to proceed with the
development, manufacture, and sale of Licensed Product(s) and to diligently
develop markets for the Licensed Product(s). RIGEL shall demonstrate such
diligence to STANFORD by achieving proof of principle through written
documentation of the following within eighteen (18) months after the Effective
Date:
a) Construction of a retroviral vector library;
b) Infection of cells with such vector library;
c) Detection of a physiological response to such infection in an
infected cell; and
d) Isolation and analysis of the peptide eliciting such
physiological response from the cell.
5.2 If RIGEL is unable to demonstrate proof of principle within
eighteen (18) months after the Effective Date, STANFORD may elect to narrow
the definition of the Licensed Field of Use to include only the use of
retrovirally mediated nucleic acid libraries for drug development, drug
delivery, drug screening, and target analysis and discovery, by providing
written notice to RIGEL thereof. Additionally, RIGEL shall provide to
STANFORD within eighteen (18) months after the Effective Date a plan for the
development and commercialization of Licensed Products (a "Development
Plan"). STANFORD shall comment upon and approve such plan, which approval
shall not be unreasonably withheld. After the Development Plan is approved by
STANFORD, RIGEL shall use reasonable efforts to diligently perform its
obligations under such Development Plan. If Stanford reasonably believes that
RIGEL is not using reasonable efforts to perform the Development Plan,
STANFORD may so notify RIGEL. The parties shall promptly thereafter meet to
discuss RIGEL's progress under the Development Plan, and shall develop a
mutually agreeable plan for remedying any such lack of diligence ( the
"Proposed Remedy"). If RIGEL fails to perform the Proposed Remedy within one
hundred and eighty (180) days after the Proposed Remedy is agreed upon,
STANFORD may elect to narrow the definition of the Licensed Field of Use to
include only the use of retrovirally mediated nucleic acid libraries for drug
development, drug delivery, and target analysis and discovery by providing
written notice to RIGEL. If RIGEL then fails to perform the Proposed Remedy
within ninety (90) days after receiving STANFORD's notice that it has elected
to so narrow the Licensed Field of Use definition, then STANFORD may elect to
convert the Exclusive License granted to RIGEL pursuant to Sections 3.1 and
3.2 to a nonexclusive license for the remaining term of this Agreement.
5.3 PROGRESS REPORT. On or before each anniversary of the Effective Date
until RIGEL markets a Licensed Product(s), RIGEL shall make a written annual
report to STANFORD covering RIGEL's progress during the preceding year toward
commercial use of Licensed Product(s). Such report shall include, as a minimum,
information sufficient to enable STANFORD to satisfy relevant reporting
requirements of the U.S. Government and to ascertain progress by RIGEL toward
meeting the diligence requirements of this Article 5.
4.
<PAGE>
6. ROYALTIES.
6.1 RIGEL agrees to pay to STANFORD a noncreditable, nonrefundable license
issue royalty of Twenty Thousand Dollars ($20,000) half of which shall be paid
within forty-five (45) days after the Effective Date and the balance of which
shall be on the first anniversary of the Effective Date.
6.2 Upon each anniversary of the Effective Date, RIGEL shall also pay to
STANFORD a Minimum Annual Royalty as follows:
Anniversary of Effective Date Minimum Annual Royalty Due
First and Second $10,000
Third through Seventh $20,000
Eighth and Thereafter $40,000
Said Minimum Annual Royalty payments are nonrefundable but they are creditable
against earned royalties to the extent provided in Paragraph 6.5. The foregoing
Minimum Annual Royalty payment shall be decreased by fifty percent (50%) if
either:
(i) Stanford abandons all patent applications from which Licensed
Patent(s) could issue prior to the time that any Licensed Patent(s) issue; or
(ii) Stanford elects to narrow the definition of the Licensed Field
of Use pursuant to Section 5.2.
6.3 If Rigel grants to a third party a sublicense under the Licensed
Technology solely for research, and not commercialization purposes (a "Research
Sublicense"), Rigel shall also pay to STANFORD a milestone payment equal to one
percent (1%) of any research milestone payment that RIGEL receives as
consideration for the grant of such Research Sublicense. RIGEL shall pay such
amount to STANFORD within sixty (60) days after RIGEL receives such research
milestone payment.
If RIGEL grants to a third party a sublicense under the Licensed
Technology which includes the right to sell and offer for sale Licensed Products
(a "Commercialization Sublicense"), RIGEL shall pay to STANFORD a sublicense fee
as follows:
First Sublicense Granted $10,000
Second Sublicensed Granted $20,000
Each Additional Sublicense Granted $30,000
RIGEL shall pay such sublicense fees to STANFORD within sixty (60) days after
the effective date of each Commercialization Sublicense.
6.4 In addition, RIGEL shall pay STANFORD earned royalties equal to (i)
0.5% of Net Sales of Licensed Products set forth in Sections 2.5(a) and 2.5(b),
or 0.25% of Net Sales of Licensed Products which can only be categorized under
Section 2.5(c). If a Licensed product
5.
<PAGE>
can be included in more than one of Sections 2.5(a), 2.5(b) or 2.5(c), the
royalty rate due to STANFORD on Net Sales of such Licensed Product shall be
0.5%.
6.5 As further consideration for the license granted to RIGEL under this
Agreement, RIGEL shall issue to STANFORD forty thousand (40,000) shares of
Preferred Stock of RIGEL, pursuant to a Stock Purchase Agreement. If such number
of shares shall equal less than three tenths of one percent (0.3%) of the total
outstanding shares of RIGEL's stock at any time during the period from the date
of issuance of such stock until one (1) year thereafter, STANFORD and RIGEL
shall discuss whether RIGEL shall adjust the number of shares issued to Stanford
under this Section 6.5.
6.6 Creditable payments under this Agreement shall be an offset to RIGEL
against up to fifty percent (50%) of each earned royalty payment which RIGEL
would be required to pay pursuant to Paragraph 6.4 until the entire credit is
exhausted.
6.7 If this Agreement is not terminated in accordance with other
provisions hereof, RIGEL's obligation to pay royalties hereunder shall continue
until ten (10) years after first commercial sale of Licensed Products.
6.8 The royalty on sales in currencies other than U.S. Dollars shall be
calculated using the appropriate foreign exchange rate for such currency quoted
by the Bank of America (San Francisco) foreign exchange desk, on the close of
business on the last banking day of each calendar quarter. Royalty payments to
STANFORD shall be in U.S. Dollars. All non-U.S. taxes related to royalty
payments shall be paid by RIGEL and are not deductible from the payments due
STANFORD.
6.9 Within thirty (30) days after receipt of a statement from STANFORD,
RIGEL shall reimburse STANFORD for all costs incurred by STANFORD, including
those costs incurred prior to the Effective Date, in connection with the
preparation, filing and prosecution of all patent applications and maintenance
of patents corresponding to the Invention.
7. PATENT RIGHTS.
STANFORD shall have the obligation to file, prosecute and maintain all
patent applications and patents included in the Licensed Patents. STANFORD will
provide RIGEL with an opportunity to review and comment upon the prosecution
strategy and to consult with STANFORD on the content of patent filings, and will
provide copies of any correspondence relating to patent applications and patents
included in the Licensed Patents to RIGEL or a designee of RIGEL. RIGEL shall
have the right to designate, in its sole discretion, those foreign countries in
which STANFORD will file, prosecute and maintain patents and patent applications
included in the Licensed Patents. STANFORD may propose to file, prosecute and
maintain a Licensed Patent in a country which RIGEL has not designated pursuant
to this Section 7. If RIGEL agrees to such designation, it shall reimburse
STANFORD costs of such filing, prosecution of maintenance of such patent or
patent applications pursuant to Section 6.9 and such patent or patent
applications shall be included in the Licensed Patents. If RIGEL does not agree
to such proposal, STANFORD may elect to proceed with such filing, prosecution or
6.
<PAGE>
maintenance at its own expense, and such patent or patent applications shall not
be included in the Licensed Patents.
8. ROYALTY REPORTS, PAYMENTS, AND ACCOUNTING.
8.1 QUARTERLY EARNED ROYALTY PAYMENT AND REPORT. Beginning with the first
sale of a Licensed Product, RIGEL shall make written reports (even if there are
no sales) and earned royalty payments to STANFORD within thirty (30) days after
the end of each calendar quarter. This report shall be in the form of the report
of Appendix B and shall state the number, description, and aggregate Net Sales
of Licensed Product(s) during such completed calendar quarter, and resulting
calculation pursuant to Paragraph 6.4 of earned royalty payment due STANFORD for
such completed calendar quarter. Concurrent with the making of each such report,
RIGEL shall include payment due STANFORD of royalties for the calendar quarter
covered by such report.
8.2 ACCOUNTING. RIGEL agrees to keep and maintain records for a period of
three (3) years showing the manufacture, sale, use, and other disposition of
products sold or otherwise disposed of under the license herein granted. Such
records will include general ledger records showing cash receipts and expenses,
and records which include production records, customers serial numbers and
related information in sufficient detail to enable the royalties payable
hereunder by RIGEL to be determined. RIGEL further agrees to permit its books
and records to be examined by STANFORD from time to time to the extent necessary
to verify reports provided for in Paragraph 8.1. Such examination is to be made
by STANFORD or its designee, at the expense of STANFORD, except in the event
that the results of the audit reveal an underreporting of royalties due STANFORD
of five percent (5%) or more, then the audit costs shall be paid by RIGEL.
9. NEGATION OF WARRANTIES.
9.1 Nothing in this Agreement is or shall be construed as:
a) A warranty or representation by STANFORD as to the validity or
scope of any Licensed Patent(s);
b) A warranty or representation that anything made, used, sold, or
otherwise disposed of under any license granted in this Agreement is or will be
free from infringement of patents, copyrights, and other rights of third
parties;
c) An obligation to bring or prosecute actions or suits against
third parties for infringement, except to the extent and in the circumstances
described in Article 13;
d) Granting by implication, estoppel, or otherwise any licenses or
rights under patents or other rights of STANFORD or other persons other than
Licensed Patent(s), regardless of whether such patents or other rights are
dominant or subordinate to any Licensed Patent(s); or
e) An obligation to furnish any technology or technological
information other than the Licensed Technology.
7.
<PAGE>
9.2 Except as expressly set forth in the Agreement STANFORD MAKES NO
REPRESENTATIONS AND EXTENDS NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR
IMPLIED, THERE ARE NO EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE, OR THAT THE USE OF THE LICENSED PRODUCT(S)
WILL NOT INFRINGE ANY PATENT, COPYRIGHT, TRADEMARK, OR OTHER RIGHTS, OR ANY
OTHER EXPRESS OR IMPLIED WARRANTIES.
9.3 RIGEL agrees that nothing in this Agreement grants RIGEL any express
or implied license or right under or to:
a) U.S. Patent No. 4,237,224, "Process for Producing Biologically
Functional Molecular Chimeras"; U.S. Patent No. 4,468,464 and U.S. Patent No.
4,740470, both entitled, "Biologically Functional Molecular Chimeras"
(collectively known as the Cohen/Boyer patents), or reissues thereof; or
b) U.S. Patent 4,656,134 "Amplification of Eucaryotic Genes" or any
patent application corresponding thereto.
9.4 STANFORD warrants that it has all right, power and authority necessary
to grant the licenses set forth in Article 3 to RIGEL, and that it has not, and
will not during the term of this Agreement, grant any right to any third party
which would conflict with the rights granted to RIGEL hereunder.
10. INDEMNITY.
10.1 RIGEL agrees to indemnify, hold harmless, and defend STANFORD and
Stanford Health Services and their respective trustees, officers, employees,
students, and agents against any and all claims by third parties for death,
illness, personal injury, property damage, and improper business practices
arising out of the manufacture, use, sale, or other disposition of the
Invention, Licensed Technology, or Licensed Product(s) by RIGEL or RIGEL's
sublicensee(s) or customers.
10.2 STANFORD shall not be liable for any indirect, special, consequential
or other damages whatsoever, whether grounded in tort (including negligence),
strict liability, contract or otherwise. STANFORD shall not have any
responsibilities or liabilities whatsoever with respect to Licensed Product(s).
10.3 RIGEL shall at all times comply, through insurance or self-insurance,
with all statutory workers' compensation and employers' liability requirements
covering any and all employees with respect to activities performed under this
Agreement.
10.4 In addition to the foregoing, RIGEL shall maintain Comprehensive
General Liability Insurance, with reputable and financially secure insurance
carrier(s) to cover the activities of RIGEL and its sublicensee(s) in the
amounts and during the periods specified herein. Such insurance shall provide
minimum limits of liability of One Million Dollars ($1,000,000) as of the first
anniversary of the date upon which RIGEL first leases a facility in which it
will
8.
<PAGE>
conduct research and development activities, and of Five Million Dollars
($5,000,000) as of the commencement of human clinical trials of Licensed
Products. Such insurance shall include STANFORD, Stanford Health Services, their
trustees, directors, officers, employees, students, and agents as additional
insureds. Such insurance shall be written to cover claims incurred, discovered,
manifested, or made during or after the expiration of this Agreement. At
STANFORD's request, RIGEL shall furnish a Certificate of Insurance evidencing
primary coverage and requiring thirty (30) days prior written notice of
cancellation or material change to STANFORD. RIGEL shall advise STANFORD, in
writing, that it maintains excess liability coverage (following form) over
primary insurance for at least the minimum limits set forth above. All such
insurance of RIGEL shall be primary coverage; insurance of STANFORD or Stanford
Health Services shall be excess and noncontributory.
11. MARKING.
Prior to the issuance of patents on the Invention, RIGEL agrees to mark Licensed
Product(s) (or their containers or labels) made, sold, or otherwise disposed of
by it under the licenses granted in this Agreement with the words "Patent
Pending," and following the issuance of one or more patents, with the numbers of
the Licensed Patent(s).
12. STANFORD NAMES AND MARKS.
RIGEL agrees not to identify STANFORD in any promotional advertising or other
promotional materials to be disseminated to the pubic or any portion thereof or
to use the name of any STANFORD faculty member, employee, or student or any
trademark, service mark, trade name, or symbol of STANFORD or the Stanford
University Hospital, or that is associated with either of them, without
STANFORD's prior written consent, except as required by law. STANFORD shall not
unreasonably hold consent under this Section 12.
13. INFRINGEMENT BY OTHERS: PROTECTION OF PATENTS.
13.1 RIGEL shall promptly inform STANFORD of any suspected infringement of
any Licensed Patent(s) by a third party. During the Exclusive period of this
Agreement, STANFORD and RIGEL each shall have the right to institute an action
for infringement of the Licensed Patent(s) against such third party in
accordance with the following:
a) If STANFORD and RIGEL agree to institute suit jointly, the suit
shall be brought in both their names, the out-of-pocket costs thereof shall be
borne equally, and any recovery or settlement shall be shared equally. RIGEL and
STANFORD shall agree to the manner in which they shall exercise control over
such action. STANFORD may, if it so desires, also be represented by separate
counsel of its own selection, the fees for which counsel shall be paid by
STANFORD;
b) In the absence of agreement to institute a suit jointly, STANFORD
may institute suit, and, at its option, join RIGEL as a plaintiff. If STANFORD
decides to institute suit, then it shall notify RIGEL in writing. STANFORD shall
bear the entire cost of such litigation and shall be entitled to retain the
entire amount of any recovery or settlement; and
9.
<PAGE>
c) In the absence of agreement to institute a suit jointly and if
STANFORD notifies RIGEL that it has decided not to join in or institute a suit,
as provided in (a) or (b) above, RIGEL may institute suit and, at its option,
join STANFORD as a plaintiff. RIGEL shall bear the entire cost of such
litigation and shall be entitled to retain the entire amount of any recovery or
settlement, provided, however, that any recovery in excess of litigation costs
shall be deemed to be Net Sales, and RIGEL shall pay STANFORD royalties thereon
at the rates specified herein.
13.2 Should either STANFORD or RIGEL commence a suit under the provisions
of Paragraph 13.1 and thereafter elect to abandon the same, it shall give timely
notice to the other party who may, if it so desires, continue prosecution of
such suit, provided, however, that the sharing of expenses and any recovery in
such suit shall be as agreed upon between STANFORD and RIGEL.
14. SUBLICENSE(S).
14.1 RIGEL may grant sublicense(s) under its Exclusive license rights
during the Exclusivity Term. RIGEL may grant sublicense(s) under nonexclusive
license rights, if such sublicense is in conjunction with a sublicense of other
RIGEL proprietary technology.
14.2 If RIGEL is unable or unwilling to serve or develop a potential
market or market territory for which there is a willing sublicense(s), RIGEL
will, at STANFORD's request negotiate in good faith a sublicense(s) hereunder on
commercially reasonable terms.
14.3 Any sublicense(s) granted by RIGEL under this Agreement shall be
subject and subordinate to terms and conditions of this Agreement, except:
a) Sublicense terms and conditions shall reflect that any
sublicensee(s) shall not grant a sublicense to a third party; and
b) The earned royalty rate specified in the sublicense(s) may be at
higher rates than the rates in this Agreement.
Any such sublicense(s) also shall expressly include the provisions of
Articles 8, 9, and 10 for the benefit of STANFORD and provide for the transfer
of all obligations including the payment of royalties specified in such
sublicense(s), to STANFORD or its designee, in the event that this Agreement is
terminated.
14.4 RIGEL agrees to provide STANFORD a copy of any sublicense(s) granted
pursuant to this Article 14.
15. TERMINATION.
15.1 RIGEL may terminate this Agreement by giving STANFORD notice in
writing at least thirty (30) days in advance of the Effective Date of
termination selected by RIGEL.
15.2 STANFORD may terminate this Agreement if RIGEL:
10.
<PAGE>
a) Is in default in payment of royalty or providing of reports;
b) Is in material breach of any provision hereof; or
c) Intentionally provides any false report;
and RIGEL fails to remedy any such default, breach, or false report within
thirty (30) days after written notice thereof by STANFORD.
15.3 Surviving any termination are:
a) RIGEL's obligation to pay royalties accrued or accruable;
b) Any cause of action or claim of RIGEL or STANFORD, accrued or to
accrue, because of any breach or default by the other party; and
c) The provisions of Articles 8, 9, and 10.
16. ASSIGNMENT.
This Agreement may not be assigned by either party without the express
written consent of the other party, except that RIGEL may assign the Agreement
in connection with a merger, consolidation or sale of all or substantially all
of RIGEL's assets.
17. DOUBLE PATENTING CONTINGENCY.
If the PTO rejects the claims of the Nolan/Rothenberg Patent
Application for double patenting in view of the claims of the Nolan Patent
Application, or the claims of the Nolan Patent Application for double
patenting in view of the claims of the Nolan/Rothenberg Patent Application,
then RIGEL may elect to assign its right, title and interest in the Nolan
Patent Application to STANFORD, in which case STANFORD shall grant to RIGEL
an irrevocable, exclusive, worldwide, royalty-free license under STANFORD's
right, title and interest in the Nolan Patent Application for all purposes.
18. ARBITRATION.
18.1 Any controversy arising under or related to this Agreement, and any
disputed claim by either party against the other under this Agreement excluding
any dispute relating to patent validity or infringement arising under this
Agreement, shall be settled by arbitration in accordance with the Licensing
Agreement Arbitration Rules of the American Arbitration Association.
18.2 Upon request by either party, arbitration will be by a third party
arbitrator mutually agreed upon in writing by RIGEL and STANFORD within thirty
(30) days of such arbitration request. Judgement upon the award rendered by the
arbitrator shall be final and nonappealable and may be entered in any court
having jurisdiction thereof.
11.
<PAGE>
18.3 The parties shall be entitled to discovery in like manner as if the
arbitration were a civil suit in the California Superior Court.
18.4 Any arbitration shall be held at Stanford, California, unless the
parties hereto mutually agree in writing to another place.
19. NOTICES.
All notices under this Agreement shall be deemed to have been fully given when
done in writing and deposited in the United States mail registered or certified,
and addressed as follows:
To STANFORD: Office of Technology Licensing
Stanford University
900 Welch Road, Suite 350
Palo Alto, CA 94304-1850
Attention: Director
To RIGEL: 24 Windsor Drive
Hillsborough, CA 94010
Attention: Dr. Donald G. Payan
Either party may change its address upon written notice to the other party.
20. WAIVER
None of the terms of this Agreement can be waived except by the written consent
of the party waiving compliance.
21. APPLICABLE LAW.
This Agreement shall be governed by the laws of the State of California
applicable to agreements negotiated, executed and performed wholly within
California.
22. SEVERABILITY.
If any provision or provisions of this Agreement shall be held to be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not be in any way affected or impaired thereby.
23. ENTIRE AGREEMENT.
This Agreement, together with the Exhibits attached hereto, embodies the
entire understanding of the parties and shall supercede all previous
communications, representations or understandings, either oral or written,
between the parties relating to the subject matter hereof. No amendment or
modification hereof shall be valid or binding upon the parties unless made in
writing and signed by duly authorized representatives of both parties.
12.
<PAGE>
24. COUNTERPARTS.
This Agreement may be executed in counterparts, with the same force and
effect as if the parties had executed the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement in
duplicate originals by their duly authorized officers or representatives.
THE BOARD OF TRUSTEES OF THE LELAND
STANFORD JUNIOR UNIVERSITY
Signature /s/ Katherine Ku
---------------------------
Name Katherine Ku
---------------------------------
Title Director, Technology Licensing
--------------------------------
Date October 7, 1996
---------------------------------
RIGEL PHARMACEUTICALS, INC.
Signature /s/ Donald G. Payan
--------------------------
Name Donald G. Payan
---------------------------------
Title President & CEO
--------------------------------
Date 10/9/96
---------------------------------
13.
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EXHIBIT A
MATERIALS FROM NOLAN LAB TO BE
LICENSED TO RIGEL
Vector Libraries
----------------
1. Random peptide library in pMSCU & Bst X1
2. SH-3 first generation library
3. CPP32 inhibitor peptide library
4. SH-3 second generation library
5. Coiled-coil library
Plasmids
--------
1. pMSCU SD & Bst X1
2. pBabc Pur
3. pMSCU SD - IRES neo Bst X1
4. p5 & MD
Cell Lines
----------
1. phiNX cell lines - gp, eco, ampho
2. 293 T
1.
<PAGE>
EXHIBIT B
SAMPLE REPORTING FORM
---------------------
Stanford Docket No. S______-________
This report is provided pursuant to the license agreement between Stanford
University and _______________________________________________________________.
License Agreement Effective Date: __________________________
Report Covering Period _________
Fixed Fees (Annual Minimum Payment) $________
Number of Sublicenses Executed _________
Net Sales $________
Royalty Calculation _________
Royalty Subtotal $________
Credit $________
Royalty Due $________
Comments:
ii