Sample Business Contracts

Manufacturing Services Agreement [Exhibits] - Tercica Medica Inc. and Cambrex Bio Science Baltimore Inc.

Manufacturing Forms

Sponsored Links

Exhibit A

Project Scope

ALL INFORMATION CONTAINED IN THE PROJECT SCOPE (INCLUDING COST ESTIMATES, TIMELINE ESTIMATES, PROJECT INFORMATION AND DELIVERABLES) IS BASED AND CONDITIONED UPON INFORMATION SUPPLIED BY AND REPRESENTED BY TERCICA.

Key Assumptions underlying this Project Scope (not all-inclusive):

Switch from [*] is successful

[*]

Minimal estimated production set-up cost and times have been incorporated

1.0 Scope of Work

CBSB will perform the following related to scale-up and cGMP manufacture of IGF-I:

1.1 Technology Transfer

Technology transfer for this project involves the challenge of transferring and implementing a process that was last performed [*] at Genentech. Addressing this challenge requires a team effort combined with experience in performing such Third-Party transfers. CBSB’s core competency is in transfer and implementation of E. coli production processes and CBSB has a proven track record in Third Party technology transfers.

CBSB’s approach to technology transfer consists of the following key areas:

1. Information transfer and evaluation (including document transfer and assay transfer)

2. Process evaluation/transfer at scale

2.1.1 Document Transfer & Data Evaluation

Tercica and Genentech will share product-related relevant information and documentation including batch records, assay documents, process development information and raw material information early in the technology transfer phase. CBSB will receive documentation from Tercica and distribute it to CBSB’s team for evaluation, to generate relevant data and document summaries. The information will provide the basis to initiate process modification and equipment

*	This provision is the subject of a Confidential Treatment Request.

and raw material procurement activities. CBSB may request additional information from Tercica. Process and equipment information relevant to validation will be provided by Tercica and summarized to assess the extent of additional further studies.

2.1.2 Assay Transfer

Tercica identified RP-HPLC as the key assay for product quantitation and product purity estimation. This method and additional assays (see included Gantt chart) will be transferred first to enable initiation of the process transfer and Scale-Up Runs. The scope of this transfer will be limited to demonstration of the assay adequate for use in process evaluation/development and will not involve the use of controlled documents.

2.1.3 Process Evaluation/Transfer At Scale

The current process was implemented successfully at Genentech. While modifications to the process have been suggested by Genentech, CBSB will execute the current process at the 10 L scale to establish the performance characteristics. These development runs will enable CBSB to understand the process technology and assay methodologies. Process development batch records will be generated to execute the process and capture data from these runs. These runs will provide a basis for evaluating the status of the process technology developed by Genentech.

2.2 Preparation of Working Cell Banks

CBSB will prepare a Working Cell Bank for the recombinant strain from the existing Master Cell Bank provided by Tercica. The Master Cell Bank will be tested for viability, bacteriophage, purity and ID prior to use at CBSB. The Working Cell Bank will be prepared adhering to cGMP in the classified areas. A Master Production Record for cell-banking will be prepared and provided to Tercica for approval prior to execution. The prepared cell banks will be tested for purity, ID, plasmid stability, plasmid sequence, bacteriophage, viability, and other relevant tests. Tests not currently performed at CBSB will be outsourced and charged to Tercica. CBSB will maintain sufficient Working Cell Bank required for production activities; the remaining cell banks will be shipped to Tercica or its repository.

2.3 Process Modifications/Improvements

Tercica has indicated that some process steps will require modification to enable implementation at CBSB in a feasible, safe and economical manner. Modifications indicated in Tercica’s request for proposal include:

Modifications to the refold buffers

Alternate method for clarification of the refolded IGF-I

Modifications to the capture column buffers

*	This provision is the subject of a Confidential Treatment Request.

Modifications to the [*] column buffers

Tercica will provide development data that supports these changes:

Solubilization of IGF-I in the fermenter (uniformity of NaOH mixing)

Efficiency of light phase separation and recovery

Efficiency of IGF-I pellet collection

Tercica has suggested that the [*] step be scaled-up to minimize the number of cycles through the column. Tercica will provide process development data that supports these changes.

CBSB will implement the requested process modifications at the [*] scale and suggest additional areas for improvement/modifications to enable reliable scale-up and implementation for commercial manufacture. Upon preliminary evaluation of the process to date, CBSB recommends improvement in the following areas:

Conversion of gradient elutions to step elutions

Absorbance-based fraction pooling vs. RP-HPLC based column pooling

Alternate method for cell solubilization for improved uniform mixing

Room temperature operations for chromatography steps

Additional modifications necessary to accommodate equipment/facility logistics at CBSB

Data available from Genentech will be evaluated to assess if any of the above changes will significantly impact Product quality and quantity as well as the cost lf the project.

Process modifications will be implemented at the [*] scale. If the modifications provide comparable Product quantity and quality, the fully-integrated process will be executed at the [*] scale with the modifications to demonstrate the effectiveness of the process.

2.4 Process Demonstration at Scale/Scale-Up Runs

CBSB strongly recommends full scale upstream process Runs early in the technology transfer phase to reduce scale-up surprises common in Third Party transfers when the process is not currently being executed. These Scale-Up Runs will provide a clear understanding of the equipment and process issues, including yields and purity, that can be expected from the process. Tercica and CBSB will use this data to determine the extent of process modifications required, the production schedule and Equipment requirements early in the project.

Process intermediates produced during these Scale-Up upstream process Runs will be used for process validation studies which will enable consistent starting material for these studies. The upstream material will be purified at a smaller scale through the downstream steps to confirm process performance. This strategy also removes demonstration runs from the critical path in the project schedule.

2.5 Process Validation Studies

*	This provision is the subject of a Confidential Treatment Request.

Process validation studies are critical to establish specifications to be included in the process validation protocols. Tercica has indicated that Genentech has historical data on the process, including parameter ranges. As part of the technology transfer, such data will be compiled to assess the extent of further validation studies to be performed to support regulatory filings. The general approach to performing process validation studies will include:

Critical process variable characterization

In-process hold time validation

Impurities removal

Materials compatibility

Cleaning validation

In addition, process step-specific validation studies will be performed. For example, in the chromatography step:

Resin sanitization/regeneration/cleaning efficacy

Resin storage solutions

Carry-over studies (product/impurities)

Dynamic binding capacity/loading studies

Column life cycle studies

A robust small scale model for process and Equipment will be established by performing these process validation studies. The Scale-Up upstream process Runs will provide process intermediates needed for the downstream process validation studies, which will more accurately represent the process performance at scale, adding value to the process validation package.

CBSB’s validation team will work with production, process development and quality control groups in generating a master validation plan for the project that includes both process and Equipment validation. The validation protocol for the process will be detailed and executed during the Conformance Lots. Specifications for the process parameters will be generated through the process validation studies (discussed above). The protocols will be reviewed and approved by CBSB and Tercica prior to execution.

A validation report detailing the results will be generated to support Tercica’s Regulatory Filings. The validation report will include data from the specific process validation studies (e.g. resin life time studies, loading studies, cleaning studies).

The estimated timeline provided for these activities assumes some preliminary data from Genentech but will include most of the key studies to be performed for each process step.

2.6 Stability Testing

A stability plan will be developed before the stability study proceeds. Actual testing requirements and degradation products will be determined by performing a [*] this assumes all Product assays are developed and transferred. Based on the results of the [*] study, critical test(s) will be identified for application in the stability study. Acceptance criteria, testing intervals, and the appropriate statistical model by which to evaluate data will be established based on ICH guidelines, quality control, quality assurance, and Tercica input. A stability study will be designed to address all key variables. CBSB will purchase and validate four (4) environmental chambers for use in the execution of this study. These chambers will be considered Equipment. The study will run for five (5) years.

2.7 Pre-production activities

2.7.1 Documentation

The document preparation strategy involves two iterations of comprehensive review to ensure high quality, detailed documentation that enables error-free execution. The documents are reviewed and approved by quality control, production and process development groups, as well as engineering and validation groups as required, to ensure accuracy. CBSB will provide Tercica with the Master Production Record and other critical process related documentation for review and approval. CBSB will prepare Master Production Records and other procedures, including:

Equipment assembly procedures

Cleaning procedures (e.g. Equipment, columns, membranes)

Buffer preparation procedures

Column packing & testing procedures

A complete set of procedures will be prepared for assembly, operation, maintenance, cleaning, and calibration of new Equipment procured for Tercica. The extent of resources/labor required is not included in the cost estimate as the specifics of the kind and quantity of Equipment required will be more fully defined during the technology transfer phase.

2.7.2 Continued Assay Transfer and Qualification

Tercica has provided a list of assays that are to be implemented for in-process, release and stability testing. CBSB will transfer and qualify assays during the pre-production phase of the project to establish equivalency between prior and current implementation. Tercica will provide detailed assay information, data, and samples of process intermediates and reference standards to enable establishment of assay equivalency and comparability.

*	This provision is the subject of a Confidential Treatment Request.

CBSB’s quality control department provides testing services. If Tercica requires assays which are not currently provided by CBSB, CBSB will outsource such assays with Tercica’s approval. CBSB will coordinate set-up, audit and review of assay methods at the testing lab. CBSB has an established system for sample shipment, data compilation and analysis of outsourced testing.

Additional development activities for assays are not included in the cost estimate and will be more fully defined during the technology transfer phase.

2.7.3 Assay Validation

CBSB and Tercica will develop an assay validation plan, comprising a list and details of all assays to be validated. Details regarding the parameters for validation and extent of validation will be established in the validation plan during the technology transfer phase. Validation protocols will be prepared and executed for the individual assays and the validation report will be generated.

The current estimate assumes that all assays required for process validation and final Quality Review and Approval will be validated by CBSB.

2.7.4 Raw Material, Resin and Filter, and Consumables Procurement

CBSB will use its approved system for procurement, testing and release of Raw Materials, Resins and Filters, and Consumables for Commercial Production. CBSB will generate a list of Raw Materials, Resins and Filters, and Consumables including vendor information, testing requirements, testing labs, sample size, and package sizes during the technology transfer phase. Raw Material Specifications and testing methods will be written for each Raw Material, Resin and Filter, and Consumable.

Tercica has indicated that Raw Material, Resin and Filter, and Consumables testing labs must be established. If Tercica requires testing that is not provided by CBSB’s quality control department, CBSB will identify and audit testing lab(s) and transfer testing methods. CBSB minimally requires ID testing on raw materials for clinical production and additional testing for commercial production. The extent and scope of testing will be established during the technology transfer phase. During Commercial Production, Tercica-specific customized databases may be established to track and maintain Raw Material, Resin and Filter, and Consumable inventory and status.

Tercica will authorize CBSB to order Raw Materials, Resins and Filters, and Consumables in accordance with the bill of materials sufficient for technology transfer work through Commercial Production, prior to the purchase of such Raw Materials, Resins and Filters, and Consumables. CBSB will pass the savings based on CBSB’s negotiated prices to Tercica.

Tercica will reimburse CBSB for all costs or expenses approved by Tercica, including freight and any applicable sales taxes associated with CBSB’s purchase of Raw Materials, Resins and Filter, and Consumables.

2.8 Vendor Qualification

All Raw Material and Resins and Filters suppliers will be qualified in accordance with CBSB policies and procedures as well as Tercica’s requirements. A minimum of [*] lots of each Raw Material and Resins and Filters will be tested in accordance with the USP-NF monograph where applicable. Materials not described in the USP-NF will be tested in accordance with Tercica’s requirements and quality control recommendations. Annual re-qualification will be performed.

2.9 Reference Material Preparation and Characterization

Product from the Clinical Runs will be used to establish a new lot of reference material. This material will be characterized and qualified according to a protocol developed by both Parties. All test results will be evaluated against current existing reference standard material.

2.10 Equipment Design, Procurement, & Validation

Genentech’s process for IGF-I manufacture requires certain equipment, including a preparative scale HPLC skid, large scale TFF systems, temperature controlled chromatography columns and equipment, large refolding tanks and other equipment. Working with Tercica and Genentech, refolding tanks and other equipment will be designed to meet the needs of the process,. CBSB has experience designing and procuring refolding tanks and TFF systems.

CBSB has a dedicated validation team to address Equipment validation needs. Validation protocols will be generated for installation qualification, operational qualification and performance qualification and executed. Cleaning validation will be performed after cleaning validation studies are performed on the new Equipment. Existing equipment validation data will be reviewed to assess whether additional validation is required to meet project needs.

CBSB has identified new Equipment that may be required to run the process. The longest lead-time is approximately six (6) months. Equipment needs will be clarified through discussions between Tercica and CBSB during the technology transfer phase.

*	This provision is the subject of a Confidential Treatment Request.

Anticipated New Equipment

[[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]		[*]
[*]	[*]	[*]	[*]		[*]
[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]		[*]
[*]	[*]	[*]	[*]		[*]
[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]		[*]
[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]		[*]
[*]				[*]	[*]
[*]
[*]	[*]	[*]	[*]		[*]
[*]	[*]	[*]	[*]		[*]
[*]	[*]	[*]			[*]
[*]	[*]	[*]	[*]		[*]
[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]		[*]
[*]				[*]	[*]
[*]
[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]	[*]
[*]				[*]
[*]
[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]			[*]
[*]	[*]	[*]		[*]
[*]	[*]	[*]		[*]
[*]	[*]	[*]			[*]
[*]	[*]	[*]	[*]		[*]
[*]				[*]	[*]
[*]				[*]	[*]]

Tercica will reimburse CBSB for all costs and expenses of new Equipment that have been approved in writing by Tercica prior to the purchase of such Equipment, including freight and any applicable sales taxes associated with the purchase of such Equipment.

2.11 Production Strategy

*	This provision is the subject of a Confidential Treatment Request.

Genentech developed and implemented production of IGF-1 at [*] for the upstream steps and [*] for the refolding and purification steps. Analysis of the production process indicates that the purification is in the critical path with respect to determining cycle time for the production process. Specifically, the preparative HPLC step (currently at 10 L scale) can be scaled to approximately [*].

The Drug Substance Commitments for [*] can be met at the [*] operation at the CBSB Facility. CBSB has expansion plans to build a large scale manufacturing suite in the green field site adjacent to its existing facility [*]. This suite could meet the Drug Substance Commitment for [*]. CBSB values the opportunity to form long-term strategic relationships with clients and welcomes Tercica’s input on the facility design. It is anticipated that the expansion could have a significant impact on process efficiency and cycle times. CBSB anticipates the scale of operation for upstream activities to be between [*] and the downstream activities to be between [*]. Several options and strategies exist to implement the process and will evolve through discussions with Tercica and Genentech.

2.12 Production Logistics at the [*] Scale

Preliminary analysis of the production process indicates that the process fits the CBSB Facility, and CBSB’s current equipment and space infrastructure. Preliminary floor plans and space plans have been evolved around the process to show that the existing and new process equipment will functionally and spatially fit into the existing facility. Utility and other process requirements have been evaluated and match the available capacity. The inherent flexibility built into the design of CBSB’s manufacturing suites enables customization of the equipment and facility to match the production process. For example, the modular design of the Clestra Panels allows installation of new Equipment (refolding tanks, TFF systems, etc) consistent with utility and facility support systems.

Preliminary process flow analysis with equipment and tank requirements has been performed. The analysis shows that other than the equipment indicated in the “Equipment Procurement” section, no other large equipment is necessary. Adjacency of the upstream and downstream production areas will allow for direct transfer of clarified refolded solution into the recovery column, obviating the need for additional holding tanks. CBSB has performed purification steps at the scales required for the process. A chromatography skid that can deliver up to 8L/min flow rate may be available for the project. Laminar flow hoods and other equipment required for bulk filtration and filling are available for the project.

[*]

2.13 Engineering Runs and Clinical Runs

Tercica has requested that [*] of Product be produced prior to the Conformance Lots. CBSB proposes to rearrange the sequence of activities to accommodate the Clinical Runs in

*	This provision is the subject of a Confidential Treatment Request.

2003. The critical path items to initiate Clinical Runs include, technology transfer, assay transfer and qualification, pre-production activities and does not require completion of assay validation and process validation studies.

Engineering Runs will be performed to refine the Master Production Record and fine-tune process parameters at scale. The Engineering Runs will be performed with draft Master Production Records that include all the details required in a cGMP document. The documents will not be formally reviewed and approved by quality assurance as the resultant Product will not be useable in humans, but will be thoroughly reviewed for content to enable modifications required for Clinical Runs. It is anticipated that a minimum of two (2) Runs will be required, with adequate time for document modifications before the initiation of the Clinical Run(s).

It is anticipated that the [*] can be produced in one (1) Clinical run as the expected yield [*]. Additional Clinical Runs can be performed if the yields are less than expected and/or additional Product is requested by Tercica.

The Engineering Runs and the Clinical Runs will enhance process understanding and will ensure better performance during the Conformance Lots.

[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]	[*]

[*]

*	This provision is the subject of a Confidential Treatment Request.

Exhibit B

Project Schedule and Budget

ALL COST AND TIMELINE INFORMATION PROVIDED IS AN ESTIMATE BASED UPON THE INFORMATION AVAILABLE AT THE TIME. THESE ESTIMATES ARE SUBJECT TO CHANGE, AS MORE INFORMATION IS DEVELOPED/DISCOVERED AND/OR IF THE PROJECT SCOPE CHANGES. COST ESTIMATES LISTED HEREIN ARE NOT FIXED COSTS FOR THE PROJECT AND ARE NOT TO BE CONSTRUED AS SUCH. ALL INFORMATION CONTAINED IN THE PROJECT SCOPE (INCLUDING COST ESTIMATES, TIMELINE ESTIMATES, PROJECT INFORMATION AND DELIVERABLES) IS BASED AND CONDITIONED UPON INFORMATION SUPPLIED BY AND REPRESENTED BY TERCICA.

Activities, Estimated Timelines, and Estimated Costs

Estimated Costs and activities are included in the enclosed Gantt chart

Total Estimated Project Time:

[*] Quality Review and Approval of Clinical Batches

[*] Quality Review and Approval of Conformance Batches

[*] Quality Review and Approval of [*] Commercial Runs

Note: Total Estimated Cost of [*] does not include cost of Commercial Production, as the [*] is not definable at this time.

Assumptions for timeline estimate

Raw Materials, Resins and Consumables are released on ID and appearance only.

Costs for Raw Materials, Resins and Consumables, and testing are not included.

Equipment costs are not included.

Identification and purity assays on cell banks are performed in-house and are included in the above cost.

No hourly overage for production (up to [*] are included As part of the monthly Suite Rate).

[*].

Set-up costs and change over times have been set to a minimum.

Process validation estimates are generic and do not include required testing.

*	This provision is the subject of a Confidential Treatment Request.

Switch from [*] is successful

Batch time reflects [*] cycle time.

*	This provision is the subject of a Confidential Treatment Request.

[*]

*	This provision is the subject of a Confidential Treatment Request.

[*]

*	This provision is the subject of a Confidential Treatment Request.

[*]

*	This provision is the subject of a Confidential Treatment Request.

[*]

*	This provision is the subject of a Confidential Treatment Request.

Exhibit C

[*]

*	This provision is the subject of a Confidential Treatment Request.

Exhibit D

Quality Agreement

This Quality Agreement (the “Agreement”) is a required and integral part of the Manufacturing Services Agreement for IGF-I Drug Substance between Tercica Medica, Inc. (“Tercica”) and Cambrex Bio Science Baltimore, Inc. (“CBSB”)(each a “Party” and together the “Parties”). This Agreement is effective upon final signature by the Parties (the “Effective Date”) and will be updated as needed, and reviewed biennially.

The parties hereto have each caused this Agreement to be executed by their duly-authorized representatives on the date and year hereinafter set forth.

Tercica		CBSB

By:		By:
	(Signature)
	(Signature)


	(Print or Type Name) (Print or Type Name)


	(Print or Type Title) (Print or Type Title)

Date:		Date:

Quality Agreement

Table of Contents

1.	Purpose of the Quality Agreement		4

2.	Quality Agreement Specific Information		4

	2.1	Term and Termination	4
	2.2	Representatives	4

3.	Abbreviations and Definitions of Terms		5

	3.1	Abbreviations	5
	3.2	Definitions of Terms	6

4.	Document Retention		11

5.	Quality Responsibility		12

6.	Change Control		12

	6.1	Master Production Records	12
	6.2	Testing and Sampling Specifications	13
	6.3	Packaging and Labeling Specifications	13
	6.4	Specification Approval	13
	6.5	Facility Changeover	13
	6.6	Documentation Distribution	13
	6.7	Compendial Compliance	12
	6.8	Regulatory Filing Requirements	12
	6.9	Annual Update Requirements	12

7.	Materials		12
	7.1	Third Party Controlled Material (if applicable)	13
	7.2	Printed Material (if applicable)	13

8.	Drug Substance Specifications		13

9.	Manufacture of the Drug Substance		14

10.	Testing of the Drug Substance		14

11.	Notification and Approval of Deviations and Failures		15

	11.1	Deviations	15
	11.2	Failures	15

12.	Quality Review and Approval and Shipment of the Drug Substance	16

13.	Retained Samples of the Drug Substance	16

14.	Storage of Drug Substance/Environmental Monitoring	16

15.	Stability Activities	17

16.	Process Validation and Qualification of the Drug Substance	17

17.	Annual Product Review (APR)	17

18.	Product Complaints	18

19.	Returned Product	18

20.	Recall of the Product	18

21.	Audits and Inspections of the CBSB Facility and Drug Substance	18

22.	Reprocessing and Rework	19

23.	Shipping	19

1. Purpose of the Quality Agreement

This Agreement outlines the responsibilities of Tercica and CBSB with respect to the quality assurance of the Drug Substance. CBSB agrees not to subcontract or change the site of any of the manufacturing, packaging, labeling, testing, and/or handling of Drug Substance unless prior written authorization is obtained from Tercica.

A matrix of responsibilities included at the end of this document delineates the primary responsible Party for the various aspects of this Agreement.

2. Quality Agreement Specific Information

2.1 Term and Termination

This Agreement commences with the Effective Date and terminates one year after the expiration of the last Commercial Batch or through completion of any ongoing stability studies, whichever is later. In the event that the MSA is terminated for any reason prior to production of Commercial Batches, this Agreement shall also terminate as of the date of termination of the MSA.

2.2 Representatives

This Agreement is between Tercica and CBSB. It has been approved by:

Name		Howard Moore

Title		Executive Vice President

Company		Tercica Medica, Inc.

Street Address		651 Gateway Blvd., Suite 950

City, State Zip code		South San Francisco, CA 94080

Phone		(650) 624-4907

Fax		(650) 624-4940

E-mail		Howard.moore@tercica.com

Name		Barbara Zinck

Title		VP, QA & Regulatory Compliance

Company		Cambrex Bio Science Baltimore, Inc.

Street Address		5901 E. Lombard St.

City, State Zip code		Baltimore, MD 21224

Phone		(410) 563-9200

Fax		(410) 563-9206

E-mail		Barbara.Zinck@cambrex.com

3. Abbreviations and Definitions of Terms

3.1 Abbreviations

Annual Product Review: APR

Cambrex Bio Sciences Baltimore: CBSB

Certificate of Analysis: COA

Certificate of Compliance: COC

Certificate of Release: COR

Chemistry, Manufacturing, and Controls: CMC

Client Change Request: CCR

Current Good Manufacturing Practices: cGMP’s

Manufacturing Service Agreement: MSA

Not More Than: NMT

Out of Specification: OOS

Pre-Approval Inspection : PAI

Quality Assurance: QA

Standard Operating Procedure: SOP

3.2 Definitions of Terms

All defined terms herein are capitalized and have the meaning set forth below:

3.2.1 “Annual Product Review” means a report prepared by CBSB that, on an annual basis, summarizes all aspects of the previous year’s manufacturing history related to the Drug Substance, including but not limited to the production history, changes to the methods of manufacture or testing, process trending data, and all data and documents requested by and required to meet Tercica’s Regulatory Authority commitments for the Annual Report.

3.2.2 “Annual Report” means a report prepared by Tercica that, on an annual basis, summarizes for the FDA or other Regulatory Authority any significant new information from the previous year that might affect the safety, effectiveness, or labeling of the Product, and any anticipated actions to be taken as result of this new information. Also summarized is the quantity of Product distributed, and any new CMC data, non-clinical data, and clinical data.

3.2.3 “Batch” means a specific quantity of Drug Substance or other material produced from a single Run, and refers to an Engineering Batch, a Clinical Batch, a Conformance Batch and/or a Commercial Batch, as the context requires.

3.2.4 “Batch Record” means all of the documentation associated with the production and testing of a given Batch, including production records, sampling documentation as recorded in the Batch Record, test results, Investigative and Corrective Action Reports (ICAR), Deviation reports, all applicable Manufacturing Process data (including any pertinent output from instrumentation) and Quality Assurance Review and Approval.

3.2.5 “Campaign” means two or more Runs, occurring in sequence, and without planned interruption for suite changeover or modifications to the Master Production Record.

3.2.6 “CBSB Facility” means the manufacturing facility owned and operated by CBSB at 5901 East Lombard Street, Baltimore, Maryland 21224 and the storage facility located at 5500 East Lombard Street, Baltimore, MD 21224.

3.2.7 “Cell Line” means the proprietary cell line for expression of the Drug Substance.

3.2.8 “Certificate of Analysis” means, for each Batch, a document prepared by Tercica: listing tests performed by CBSB or approved Subcontractors, specifications, and test results.

3.2.9 “Certificate of Compliance” means, for each Batch, a document prepared by CBSB: (i) listing the manufacturing date, unique Batch number, and quantity of Drug Substance in such Batch, (ii) certifying that such Batch was manufactured in accordance with the Master

Production Record and cGMP and (iii) certifying that all Investigative and Corrective Action Reports are completed and approved. The Parties shall from time to time agree upon a format or formats for the Certificate of Compliance to be used under this Agreement.

3.2.10 “Certificate of Release” means, for each Batch, a document prepared by Tercica certifying that the Batch has met all criteria for release and has been dispositioned for its intended use.

3.2.11 “cGMP” means the regulatory requirements for current good manufacturing practices promulgated by the FDA under 21 C.F.R. §§ 210, 211 (as applicable to bulk drug substance only) and ICH, Guidance for Industry Q7A Good Manufacturing Practice Guidance for Active Pharmaceutical Ingredients as the same may be amended from time to time.

3.2.12 “Client Change Request” means a CBSB document used to accomplish amendments and modifications to documents which are part of CBSB’s cGMP document system, including but not limited to MPR’s, standard operating procedures and Materials Specifications.

3.2.13 “Clinical Batch” means a Batch produced from a Clinical Run.

3.2.14 “Clinical Run” means a Run manufactured in accordance with the Master Production Record that is initiated following the Engineering Run(s) and is used to produce Drug Substance for use in clinical trials of the Product.

3.2.15 “Commercial Batch” means a Batch produced from a Commercial Run.

3.2.16 “Commercial Run” means a Run manufactured in accordance with the Master Production Record that is initiated following the commencement of Commercial Production and is used to create Product for commercial or clinical use.

3.2.17 “Conformance Batch” means a Batch produced from a Conformance Run.

3.2.18 “Conformance Run” means a Run manufactured in accordance with the Master Production Record and any approved validation protocol(s), used to confirm and/or to document the operability and reproducibility of the Manufacturing Process at the CBSB Facility.

3.2.19 “Consumables” means all bags, liners and other single use or regularly replaced materials that are required to perform the Manufacturing Process (excluding Raw Materials, Resins and Wearables), all of which meet the applicable Materials Specifications.

3.2.20 “Designated Carrier” means the common carrier selected by Tercica to take delivery of Drug Substance from the CBSB Facility.

3.2.21 “Deviation” means the document used to obtain approvals to temporarily modify or to document excursions from operating, manufacturing, testing instructions, target/informational test results, or procedures. A temporary (or planned) deviation does not

permanently change existing manufacturing instructions or procedures; it is intended to be a specific and limited use document. Unplanned deviations (excursions) should be fully documented and a formal investigation performed if there is any possibility of an effect on product quality due to the deviation.

3.2.22 “Drug Substance” means IGF-I in bulk form that has been manufactured by CBSB pursuant to this Agreement and in accordance with the Master Production Record, that has been purified to a concentrated form from one Batch and can be stored in a liquid or frozen form under appropriate conditions.

3.2.23 “Equipment” means those certain pieces of equipment described in the Project Scope used to produce the Product that are purchased or reimbursed to CBSB by Tercica, including, without limitation, the related documentation regarding the design, validation, operation, calibration and maintenance of such equipment. Components of the Equipment, such as valves, pumps and agitators, shall also be deemed Equipment.

3.2.24 “EMEA” means the European Medicines Evaluation Agency, or any successor agency.

3.2.25 “Engineering Batch” means a Batch produced from an Engineering Run.

3.2.26 “Engineering Run” means a Run used for process demonstration and engineering of some or all of the Manufacturing Process steps.

3.2.27 “Facility Description” means a summary description of the manufacturing facility, including but not limited to structure, utilities, and equipment.

3.2.28 “FDA” means the United States Food and Drug Administration, or any successor agency thereto.

3.2.29 “Field Alert Report” means a report prepared by Tercica and supplied to the FDA summarizing in a timely manner any incidents involving mislabeling, bacterial, chemical, or physical contamination that may result in the drug product failing to meet established specifications.

3.2.30 “Governmental Authority” means any (i) nation, state, county, city, town, village, district or other jurisdiction of any nature, (ii) federal, state, local, municipal, foreign or other government, (iii) governmental or quasi-governmental authority of any nature (including any governmental agency, branch, department, official or entity and any court or other tribunal, including an arbitral tribunal), (iv) multi-national organization or body, or (v) body exercising, or entitled to exercise, any administrative, executive, judicial, legislative, police, regulatory or taxing power of any nature.

3.2.31 “Health Canada” shall mean the Canadian Federal government department known as Health Canada or Santé Canada.

3.2.32 “IGF-I” means the active pharmaceutical ingredient known as insulin-like growth factor-I or recombinant human insulin-like growth factor-1.

3.2.33 “IGF-I Process Validation Plan” or “PVP” means a summary plan document jointly developed and approved by CBSB and Tercica, intended to define all activities, studies, and documentation required to assure that the IGF-I Manufacturing Process meets and conforms to all Regulatory Requirements necessary for a commercial manufacturing process, including but not limited to Raw Material and Resin qualification, method validation, cleaning validation, performance qualification of process specific equipment not covered under CBSB’s Master Validation Plan, and execution of Conformance Batches.

3.2.34 “Investigative and Corrective Action Report” or “ICAR” means the document that is used to record the investigation of, as well as the review and disposition of, a failure related to a cGMP manufacturing system.

3.2.35 “Investigational New Drug” or “IND” means an authorization from the FDA to administer an investigational drug or biological product to humans in clinical trials.

3.2.36 “Manufacturing Documentation” means all documents and records describing or otherwise related to the Manufacturing Process, other than those embodied in the Master Production Record.

3.2.37 “Manufacturing Process” means the production process for the manufacture of Drug Substance pursuant to this Agreement, as described in the Master Production Record, as such process may be changed from time to time in accordance with this Agreement.

3.2.38 “Manufacturing Services Agreement” means the manufacturing services agreement for IGF-I between the Parties of even date herewith.

3.2.39 “Master Production Record” or “MPR” means the document, proposed by CBSB and approved by Tercica, that defines the manufacturing methods, test methods, specifications, materials, and other procedures, directions and controls associated with the manufacture and testing of Drug Substance. The Master Production Record shall also include or incorporate by reference, without limitation, such information as the Materials Specifications, in-process and final Drug Substance sampling standards, equipment and instrumentation specifications and standard operating procedures, including, without limitation, standard operating procedures for in-process quality control testing.

3.2.40 “Master Validation Plan” means a written plan stating how facilities, systems, and equipment (including control software) will be validated to provide a high degree of assurance that they are fit for use in pharmaceutical production

3.2.41 “Materials Specification” or “MS” means a document detailing the specifications for each Raw Material, Resin or Consumable, each as mutually approved by the Parties.

3.2.42 “NDA” means a new drug application for the Product, any equivalent successor filing thereto with the FDA, and any supplements or amendments to any of the foregoing.

3.2.43 “Out of Specification” or “OOS” means any quality control test result that fails to meet defined and approved specifications.

3.2.44 “Product” means the final dosage form of IGF-I.

3.2.45 “Quality Review and Approval” means CBSB’s review and approval, by CBSB’s quality assurance department, of a Batch of Drug Substance and the associated Batch Record, resulting in the issuance of Certificate of Compliance by CBSB.

3.2.46 “Raw Materials” means all ingredients, solvents and other components of the Drug Substance required to perform the Manufacturing Process (excluding any Consumables, Resins and Wearables).

3.2.47 “Regulatory Authority” means the FDA, EMEA or Health Canada, or all of the foregoing, as the case requires.

3.2.48 “Regulatory Filing” means any or all correspondence or petitions, including but not limited to the IND or NDA, to Regulatory Authorities for the purpose of registering the Product or the Manufacturing Process as required by statute, or modifying or supplementing existing filings and subsequent amendments and supplements thereto, including any foreign counterparts thereof and any other filings required by Regulatory Authorities relating to the manufacture, testing, sale or distribution of the Product under this Agreement.

3.2.49 “Regulatory Requirements” means (i) obtaining and maintaining any and all permits, licenses, filings and certifications required by the Regulatory Authorities, (ii) compliance with the cGMPs of the Regulatory Authorities, applicable to any manufacturing or processing activities hereunder or the CSBS Facility or other facilities at which any of the Manufacturing Process is performed, and (iii) any laws, rules, guidelines, regulations, guidance, points to consider documents and standards of any Governmental Authority, whether within or outside the United States (including, without limitation, the Environmental Protection Agency (EPA), the Occupational Safety and Health Administration (OSHA), the Drug Enforcement Administration (DEA) and state and local authorities), that apply to the Manufacturing Process or CBSB Facility or other facilities at which any of the Manufacturing Process is performed.

3.2.50 “Reprocessing.”means duplication of a step or steps currently in the Manufacturing Process in order to bring the Drug Substance into conformance with specifications and which will not alter the safety, identity, strength, quality, or purity of the Drug Substance beyond the established requirements. Reprocessing associated with Drug Substance having a FDA submission requires Tercica’s prior approval.

3.2.51 “Rework.” means any additional steps taken to process a Batch (other than reinspection) to bring it into conformance with the specifications and which will not alter the safety, identity, strength, quality, or purity of the Drug Substance beyond the established requirements. All Rework must be documented per approved Rework documentation requirements and appended to an ICAR or Deviation. Rework associated with Drug Substance having a FDA submission requires Tercica’s prior approval and Regulatory Authority review. Product that must be reconditioned in order to Reprocess is considered to be a Rework.

3.2.52 “Resins” means all chromatographic media intended to refine or purify the Drug Substance, as specified in the Master Production.

3.2.53 “Run” means a single operation of the Manufacturing Process from fermentation start at the [*] through the purification process to produce Drug Substance at the CBSB Facility approved or authorized by Tercica. Run refers to an Engineering Run, Clinical Run, Conformance Run and/or Commercial Run, as the context requires. A fermentation start shall be deemed a Run if such fermentation start proceeds to fermentor inoculation at the [*] or later in the Manufacturing Process.

3.2.54 “Shipping Guidelines” means all CBSB written procedures, as approved by Tercica, describing the methods of packaging, preserving, monitoring, and shipping, any and all Tercica property, including the Drug Substance.

3.2.55 “Storage Guidelines” means all CBSB written procedures, as approved by Tercica, describing the methods of packaging, preserving, monitoring, and storing, any and all Tercica property, including the Drug Substance.

3.2.56 “Subcontractor” means any independent entity that CBSB contracts with to perform any services or meet any obligations that are required under the terms and conditions of this Agreement.

3.2.57 “Third Party” means any party other than Tercica, CBSB and their respective Affiliates.

3.2.58 “Wearables” means any non-sterile coverings or protective gear used by the CBSB employees or agents in the course of the performing the development and cGMP manufacturing services hereunder, including without limitation gloves, coveralls, booties, eye shields and the like.

4. Document Retention

Original executed Batch Records will be maintained on-site by CBSB’s QA department, and will be made available for inspection and review by Tercica and/or its agents. Copies of executed Batch Records will be sent to Tercica, upon Tercica’s request, for their review and approval. Records maintained and stored by CBSB shall be retained for at least [*] year after the expiry date of

*	This provision is the subject of a Confidential Treatment Request.

the Batch of Drug Substance associated with the records. Tercica will provide to CBSB the expiry date of all Batches of Drug Substance. Any records no longer required to be retained by CBSB shall be returned to Tercica. CBSB has the option to maintain copies of the Batch Records that are returned to Tercica under the confidentiality terms of the Manufacturing Services Agreement between the Parties.

5. Quality Responsibility

CBSB is responsible for meeting cGMP compliance in the manufacture of Drug Substance for Tercica, including without limitation, documentation of all completed Batch Records and quality control testing, calibration and validation of Equipment, the CBSB Facility and utilities, acceptable environmental monitoring results, and acceptable resolution of Deviations and ICARs.

Tercica is responsible for the final review, approval and release of the Drug Substance and retains full responsibility for the disposition and release of the Drug Substance for any purpose. Any dispute between Tercica and CBSB with regard to failure or non-conformance of the Drug Substance shall be subject to the procedures as set forth in the MSA. Tercica’s disposition and release will be independent of CBSB’s Quality Review and Approval.

6. Change Control

All changes in this Agreement must be documented as an addendum to the original Agreement and reviewed and approved by representatives of Tercica’s QA and CBSB’s QA prior to implementation.

CBSB will utilize a documented system of procedures for the control of changes to Raw Materials, Resins, packaging materials, Equipment, Master Production Records, the Manufacturing Process, sampling, test methods, and CBSB Quality Review and Approval requirements.

Any changes that can affect the Drug Substance manufactured for Tercica shall be reviewed and approved by Tercica prior to implementation.

6.1 Master Production Records

Master Production Records will be developed and approved by CBSB and Tercica. Tercica’s approval of the MPR must be received at least [*] prior to the start of a Run.

*	This provision is the subject of a Confidential Treatment Request.

6.2 Testing and Sampling Specifications

Testing and sampling specifications for Raw Materials, Resins, applicable Consumables, or Drug Substance will be incorporated into the CBSB MPR and/or Materials Specifications. These testing and sampling specifications, the MPR, and Materials Specifications will be developed and approved by CBSB and Tercica.

6.3 Packaging and Labeling Specifications

Packaging and labeling specifications for Drug Substance will be incorporated into the MPR, associated standard operating procedures and/or Materials Specifications. These packaging and labeling specifications, the MPR, associated standard operating procedures, and Materials Specifications will be developed and approved by CBSB and Tercica.

6.4 Specification Approval

Specification initiation or revision that affects the scientific or technical content requires approval before proposed changes are implemented. This applies to manufacturing, testing, storage, and labeling of the Drug Substance, as well as any changes to the Materials Specifications for Raw Materials, Resins, and Drug Substance. Editorial or format changes to applicable specifications not affecting the scientific/technical content or intent of the specification will not require approval by Tercica. Those documents requiring Tercica approval are as follows:

Drug Substance specifications listed in the MPR

Materials Specifications

Client Change Requests (CCRs) will be forwarded to Tercica via appropriate express mail or facsimile.

When Tercica initiates a CCR for any applicable specifications, the appropriate CBSB department shall be provided the proposed specification and appropriate documentation that summarizes and justifies each change.

6.5 Facility Changeover

CBSB will notify Tercica of changes in the types of products that may be manufactured using same CBSB manufacturing suite and/or CBSB equipment. CBSB will provide documentation of the cleaning procedure and cleaning validation studies to demonstrate suitable clearance of the previous product manufactured with or in the CBSB equipment used for Tercica’s Manufacturing Process and the cleaning agent residues.

6.6 Documentation Distribution

Tercica will provide CBSB with the final Drug Substance and stability specifications. CBSB will provide copies of the MPR and stability protocols to Tercica for review and approval in order to maintain consistency between the Parties.

6.7 Compendial Compliance

Compliance to all relevant compendial requirements is the responsibility of both Tercica and CBSB.

6.8 Regulatory Filing Requirements

Tercica is the owner of the Drug Substance and is responsible for Annual Reports and any other Regulatory Filings. CBSB is responsible for maintaining accurate Manufacturing Process records that contain any methods, specifications, and manufacturing processes contained in the Regulatory Filings. Tercica is responsible for notifying CBSB of any change in the Regulatory Filings that may affect the Manufacturing Process and/or the Drug Substance.

6.9 Annual Update Requirements

Tercica will provide CBSB with the Annual Report filing date. CBSB shall provide Tercica with Drug Substance related documentation [*] days prior to the filing date for the purpose of updating regulatory information.

7. Materials

CBSB shall maintain an approved suppliers list for all Raw Materials, Resins and applicable Consumables in accordance with CBSB’s procedures. CBSB will provide the Raw Material, Resin, or Consumable name and supplier’s name to Tercica upon request. Tercica’s approval will be required for any supplier change for Raw Materials or Resins used in the manufacture of Drug Substance.

CBSB agrees to sample and retain sufficient amounts of all Raw Materials and Resins, except water, compressed gasses and any highly volatile compounds. The amount of retained samples and the period of retain is specified in CBSB’s Materials Specifications.

All Raw Materials, Resins and Consumables purchased for use in the manufacture, storage and shipping of Drug Substance will be purchased, received, inspected as appropriate, tested as appropriate, stored, and handled in accordance with CBSB’s standard operating procedures. CBSB will maintain samples of Raw Materials and Resins in accordance with standard operating procedures. All Raw Materials used in the Manufacturing Process shall meet the approved Materials Specifications.

*	This provision is the subject of a Confidential Treatment Request.

Under no circumstances should any materials, which may present a potential hazard to the Raw Materials utilized in the manufacture of Drug Substance, be stored in the same facility, or in proximity to the area utilized for storage of Tercica’s Raw Materials, unless appropriate steps are taken to assure prevention of cross contamination. Potential hazardous materials include, but are not limited to, beta-lactam and cephalosporin antibiotics. If such materials are stored in the same facility, Tercica and CBSB must agree to their separation and segregation, including, but not limited to packaging and spatial segregation, as needed.

CBSB will qualify primary suppliers of all Raw Materials and Resins, and will potentially qualify secondary sources of certain critical Raw Materials and Resins, as appropriate. Supplier qualification must be complete by completion of the Conformance Runs and will include full testing of the first three lots of Raw Material or Resin and minimally annual testing of one lot thereafter.

7.1 Third Party Controlled Material (if applicable)

Raw Materials, Resins and/or Consumables controlled by Tercica may be supplied by Tercica to CBSB, in accordance with the Material Specifications. If such material is not sourced from a CBSB approved supplier, then Tercica shall be responsible for qualifying these suppliers. If suppliers of Raw Materials, Resins or Consumables are not CBSB approved suppliers, Tercica shall provide CBSB with certification indicating an acceptable supplier evaluation has been completed that includes documentation that the supplier’s compliance with appropriate quality standards or current industry practice and Third Party requirements are acceptable. CBSB must be notified if Tercica changes the suppliers of Raw Materials, Resins or Consumables that might have a negative impact on CBSB’s operation.

7.2 Printed Material (if applicable)

Tercica shall be responsible for, and provide CBSB with all copy content and mechanicals for all printed materials associated with the Drug Substance. This includes, but is not limited to container labels, containers, and cartons. Tercica shall be responsible for compliance with all federal, state, and local regulations concerning packaging and labeling materials, and for obtaining any necessary Regulatory Authority approvals of printed materials.

8. Drug Substance Specifications

The Drug Substance must be manufactured, packaged, labeled, handled, and stored in accordance with the MPR or as mutually agreed upon by Tercica and CBSB. CBSB shall develop, at Tercica’s direction, all in-process and final Drug Substance specifications, including acceptance limits for each required test. Establishment of appropriate test methods and supporting test method validation will be performed by CBSB and approved by Tercica. Each Batch of Drug Substance manufactured by CBSB for Tercica will be sampled and tested in accordance with the MPR.

9. Manufacture of the Drug Substance

Under no circumstances should any other products that may present a potential hazard to the Drug Substance, such as beta-lactam and cephalosporin antibiotics, be manufactured, processed, packaged or stored in the CBSB Facility. CBSB shall make Tercica aware of the presence of any potentially hazardous products. Mutual agreement is required between the Parties as to adequate storage of any potentially hazardous products. Any Regulatory Requirements regarding storage of different types of products shall be adhered to.

The manufacture of Drug Substance by CBSB for Tercica must be in accordance with the MPR, or as mutually agreed upon, and in compliance with all cGMPs and any other applicable Regulatory Requirements. CBSB will prepare, for each Batch, documentation as agreed upon between Tercica and CBSB. This complete documentation must be readily accessible for review and inspection by Tercica and/or Regulatory Authorities if requested.

10. Testing of the Drug Substance

The testing of the Drug Substance will be carried out by CBSB, or an approved Subcontractor according to validated test methods and appropriately documented. All test methodologies, with the exception of those test methodologies developed by Tercica, will be validated by CBSB and approved by CBSB and Tercica. For those procedures which appear in the current USP/NF or other recognized standard references, qualification of the testing method for the Drug Substance and a statement indicating the reference shall suffice. For all test methods utilized by CBSB, documentation supporting validation of the test method shall be supplied, upon request, to Tercica. For test methods developed by Tercica, Tercica shall supply CBSB with the supporting validation documentation. Upon method transfer and review of CBSB’s data, Tercica will provide CBSB with written authorization verifying CBSB’s ability to perform such tests.

If a Subcontractor is utilized to perform testing, the Subcontractor must be qualified by CBSB as required by CBSB’s standard operating procedures. The Subcontractor must utilize validated or qualified test methods and provide complete documentation and copies of associated raw data. Tercica shall be informed of any Subcontractor used for Drug Substance testing, and must approve their use in Drug Substance testing.

CBSB will qualify a new reference material for use in Drug Substance testing, as needed, and will maintain the reference material under appropriate storage conditions with appropriate controls, in accordance with the Storage Guidelines.

CBSB will provide to Tercica a summary of test results in the Batch Record and any other associated testing documentation for each Batch of Drug Substance manufactured. Tercica reserves the right to inspect and/or test all Batches of the Drug Substance produced by CBSB, prior to Tercica’s release and distribution of the Drug Substance for further processing.

11. Notification and Approval of Deviations and Failures

11.1 Deviations

CBSB must notify Tercica within [*] days from the initiation of the investigation, whenever there is a significant Deviation. A significant Deviation is defined as any out of specification result and/or any manufacturing, packaging, labeling or testing Deviation that may effect the quality, safety or efficacy of the Drug Substance.

Reprocessing will always be considered a significant Deviation, and will only be performed if validated and approved by Tercica. All Deviations will be investigated and fully documented by CBSB. This documentation will be retained as part of the Batch documentation for the Batch affected. When deemed necessary, Tercica reserves the right to request additional or a more in-depth investigation of the Deviation by CBSB. Tercica approval shall be obtained in writing (fax confirmation is acceptable) for any Deviation impacting compendial status or Regulatory Filings. The approval must be received within [*] days. Tercica will provide a documented Drug Substance impact assessment for all Deviations that impact the Drug Substance. The documented assessment must be received within [*] days. In cases where Tercica requests a planned deviation, the request must be submitted in writing. Tercica is responsible for notifying the FDA regarding any required Field Alert Report according to 21 CFR 314.81.

11.2 Failures

Drug Substance not meeting the specifications established in the MPR will be handled as a failure and documented as such based on CBSB’s standard operating procedures. Actions taken to investigate the failure and to justify the CBSB’s Quality Review and Approval of the Batch of Drug Substance must be fully documented.

The ICAR will be approved by both CBSB and Tercica as stated below. The approved ICAR will become part of the Batch Record for that specific Batch of Drug Substance. Any resulting corrective and preventative actions shall be followed through timely closure. Approval by the appropriate QA functions will be solicited and may be obtained via facsimile copy.

Failure		Approval Requirements
Drug Substance		Tercica and CBSB
Raw Materials and Resins sourced and used by CBSB		CBSB
Drug Substance and Raw Materials sourced by Tercica		Tercica and CBSB

Note: Approval of changes to critical Raw Materials or Resins, such as a new supplier or vendor-notified process changes in the production of Raw Materials or Resins, must also be approved

*	This provision is the subject of a Confidential Treatment Request.

by Tercica. CBSB will notify Tercica of modifications to the CBSB Facility that may affect the Drug Substance or Manufacturing Process prior to implementation.

In the event of a dispute regarding the failure of a Batch of Drug Substance, an independent, mutually acceptable qualified Third Party will be engaged to determine whether such Batch does indeed constitute a failure. If such Batch does constitute a failure, liability for such Batch shall be determined in accordance with the MSA.

12. Quality Review and Approval and Shipment of the Drug Substance

A Certificate of Compliance (COC), copies of completed Batch Records, Deviations and ICARs, and any applicable Manufacturing Documentation shall be provided to Tercica by CBSB within [*] after CBSB’s Quality Review and Approval of the Batch is completed.

The Batch Record testing summary generated upon completion of all testing requirements for a Batch will contain the test performed, the corresponding specification, and the test results. Tercica is responsible for approval and release of the Drug Substance after review of CBSB’s test results and supporting data, the COC and Batch Records as required. Tercica will review the Batch documentation and inform CBSB within [*] weeks of receipt if there are any potential issues that may warrant investigation by CBSB. CBSB will then respond to or resolve said issue within [*] weeks of notice from Tercica, or in a mutually agreeable time frame. Upon final approval by Tercica, Tercica will generate a Certificate of Analysis (COA) and a Certificate of Release (COR).

Final release of the Drug Substance, which is defined as the release for further processing, is the responsibility of Tercica. CBSB has the responsibility to ship the product to Tercica, or such other location as specified in writing by Tercica, after CBSB Quality Review and Approval. CBSB will not ship any Drug Substance to any destination until final release by Tercica, unless prior approval has been received from Tercica to perform such shipments.

13. Retained Samples of the Drug Substance

CBSB agrees to store retained samples for all Drug Substance, unless otherwise agreed upon between Tercica and CBSB. These retained samples will include both the internal reference samples and Regulatory Authority reference samples. The quantity and number of retained samples will be specified by Tercica and provided to CBSB. CBSB agrees to store the retained samples in accordance with the Storage Guidelines and in a secure area for a period of time as mutually agreed to by the Parties. This information will be incorporated into the appropriate CBSB standard operating procedure.

14. Storage of Drug Substance/Environmental Monitoring

CBSB agrees to store Drug Substance in accordance with the Storage Guidelines and the MPR and in a secure area. If special storage conditions are necessary, they will be described in the

*	This provision is the subject of a Confidential Treatment Request.

Storage Guidelines and/or the MPR and supplied by Tercica to CBSB. CBSB agrees to comply with any special storage conditions as contained in the Storage Guidelines.

Where testing of microbial levels is required for the Drug Substance, the areas of the CBSB Facility used for the manufacture and packaging process shall be environmentally monitored. CBSB will be responsible for the establishment and institution of an environmental monitoring program to assure that the Drug Substance will meet the required endotoxin and microbial level testing specifications, and shall provide Tercica with access to the records from this environmental monitoring program.

15. Stability Activities

The responsibility for stability testing, data interpretation, and reporting shall belong to CBSB or a mutually approved Subcontractor. CBSB or a mutually approved Subcontractor shall also supply stability reports to Tercica. The updating of stability information for Regulatory Filings for the Drug Substance is the responsibility of Tercica. All stability related activities under the responsibility of CBSB or a mutually approved Subcontractor shall be completed in a timely manner.

16. Process Validation and Qualification of the Drug Substance

The Manufacturing Process and control procedures (including, but not limited to: cleaning procedures; process hold times; in-process stability; buffer stability; column reuse and longevity studies; and development and justification of all processing parameters) shall be validated and qualified by CBSB according to the IGF-I Process Validation Plan (PVP) in the CBSB Facility and using the Equipment CBSB intends to employ to manufacture Drug Substance for Tercica.

A PVP will be created with input from both CBSB and Tercica for the Manufacturing Process. Tercica will submit to CBSB an outline of the PVP for CBSB’s review. The PVP will be jointly generated and approved by both Tercica and CBSB. The PVP will contain all of the required activities and acceptance criteria and all activities and acceptance criteria will be approved and documented. The PVP will be executed on at least [*] Batches of Drug Substance produced by CBSB for Tercica, unless otherwise agreed upon by Tercica and CBSB. If there are any Deviations or ICARs during the execution of the PVP, they must be immediately communicated to Tercica within [*] days. If the Deviations or ICARs cannot be resolved, the PVP must be repeated on additional Batches until at least [*] Batches of Drug Substance meet all requirements as specified in the MPR. Any Deviations or ICARs encountered during the execution of the PVP must be documented by CBSB.

All related validation/qualification documents will be assembled in a process validation summary report and provided to Tercica for review and approval. Tercica will retain copies of the approved protocols and final reports.

17. Annual Product Review (APR)

*	This provision is the subject of a Confidential Treatment Request.

The Annual Product Review (APR) will be prepared by CBSB and reviewed according to requirements mutually agreed to by the Parties. All APR activities will be completed and documented [*] days before the target submission date of Tercica’s Annual Report. Tercica will notify CBSB of the target submission date for the Annual Report. The APR documentation completed by CBSB will be provided to Tercica for review and approval. Tercica will be responsible for submission of information contained in the APR to Regulatory Authorities as part of the Annual Report.

Tercica and CBSB will meet periodically to review quality issues related to the obligations and responsibilities as described in this Agreement. During this periodic review, quality issues related to the manufacture of Drug Substance by CBSB will be reviewed. The information presented and discussed during this review meeting will be documented by CBSB and mutually approved by the Parties.

18. Product Complaints

Tercica, or their agent, will typically receive complaints and communicate with the customers and close all complaints related to the Product. CBSB will provide any complaint information received (from customers in the marketplace and/or Regulatory Authorities) to Tercica within NMT [*] days after receipt of such information, unless a more urgent need is recognized, such as cases involving potential Product tampering, or an adverse medical event. Upon written request by Tercica, CBSB will investigate the complaints as required and provide a written report on the results of the investigation to Tercica in NMT [*] days after receipt of such written request, or sooner if agreed to by the Parties. Tercica will communicate with the customers and/or Regulatory Authorities the results of the complaint investigation, if necessary. Tercica shall provide complaint files to CBSB onsite, or via fax, within one (1) business day of CBSB’s request, if they are required during a FDA inspection.

19. Returned Product

The specific handling of returned Product will be specified and documented by Tercica, if required.

20. Recall of the Product

In the event of recall, withdrawal, or field correction of Product, i.e., if the Product violates applicable laws, regulations, or is deemed unacceptable for some other reason, whether or not such action is requested by any Governmental Agency, Tercica shall immediately notify CBSB QA in writing. During a Product recall, withdrawal, or field correction, CBSB shall fully cooperate with Tercica in conducting the necessary investigational activities.

21. Audits and Inspections of the CBSB Facility and Drug Substance

CBSB will notify Tercica of any inspections or actions by Regulatory Authorities or other enforcement bodies, which could potentially impact the Drug Substance. CBSB will provide Tercica

*	This provision is the subject of a Confidential Treatment Request.

with the applicable or redacted results of all such Regulatory Authority inspection or action within NMT [*] day of such inspection or action. If the inspection is regarding Drug Substance, Tercica will have at least [*] representatives at the CBSB Facility during the inspection to address Drug Substance specific questions, and these representatives will be permitted to participate in the inspection, as appropriate. Tercica shall provide to CBSB any requested documents if they are required for a FDA or any other Regulatory Authority inspection. Tercica must notify CBSB immediately of any activities or communications that may result in an inspection of the CBSB Facility.

Tercica reserves the right to audit the CBSB Facility and systems, as they relate to the manufacture of Drug Substance, with the exception of information and operations that constitute CBSB’s trade secrets or information regarding the identity of other CBSB clients. These audits may be performed [*], at times mutually agreed upon by Tercica and CBSB. Tercica shall provide at least [*] days advance notice for such audits.

Note: The [*] audit limitation will be waived if the audit to be performed is a “for cause” audit.

The right to audit will also cover any Subcontractors utilized by CBSB. Tercica reserves the right to be on-site at the CBSB Facility during the manufacture of Drug Substance, and/or during the inspection of the Drug Substance by any Regulatory Authorities. Tercica shall provide at least [*] weeks advance notice to be on site at the CBSB Facility during the manufacture of Drug Substance. CBSB will respond to PAI observations within [*] days and all other inspection observations within [*] days or the time specified by that Regulatory Authority, whichever is less. CBSB shall comply with all applicable Regulatory Requirements.

22. Reprocessing and Rework

Reprocessing and/or Rework activity can only be performed by mutual agreement of the Parties. Reprocessing and/or Rework directions must be established to define the process for such Reprocessing and/or Rework. If the Product is a filed NDA or equivalent, Reprocessing and/or Rework parameters must be developed and approved by Tercica and CBSB prior to implementation. Reprocessing and/or Rework of Drug Substance must be documented to state rationale and justification.

23. Shipping

CBSB will control and coordinate all shipping activity unless specified otherwise by Tercica according to specified Shipping Guidelines. Shipping validation will be Tercica’s responsibility, but will be performed in collaboration with CBSB and appropriate qualified Subcontractors.

*	This provision is the subject of a Confidential Treatment Request.

		Responsible Party
Item	Activity	Tercica	CBSB
1.0 Purpose of the Quality Agreement

	Define purpose of Quality Agreement	X	X
2.0 Quality Agreement specific information

	Record Quality Agreement specific information	X	X
3.0 Abbreviations and Definitions of Terms

	Prepare comprehensive list of abbreviations and definitions	X	X
4.0 Documentation

	Store and maintain original executed Batch Records one year past expiry date of corresponding Batch.		X

	Provide preliminary specifications and expiration dates to CBSB.	X
5.0 Quality Responsibility

	Assure that all activities associated with the manufacture of Drug Substance are performed in compliance with cGMP.		X
	Review necessary Batch documentation, approve and disposition Drug Substance.	X
6.0 Change Control

	Establish and maintain appropriate change control procedures, including not but limited to revisions, changes or modifications to documentation, processes or the CBSB Facility that affect the Manufacturing Process or have the potential to affect the quality, purity, safety, or efficacy of the Drug Substance.		X

	Prepare and submit a change request or notification to Tercica for all proposed changes to documentation, the CBSB Facility/equipment, the Equipment, the Manufacturing Process, test methods, and/or specifications that affect the Drug Substance.		X

	Review proposed changes, assess the impact on Regulatory Filings, and approve changes.	X

	Changes to the CBSB Facility: CBSB will notify Tercica in advance of any changes in the layout or structure of the Equipment or in the operation and structure of the CBSB Facility which could have an adverse impact on the manufacturing of the Drug Substance or the quality of the Product. CBSB shall not be obligated to obtain prior approval for changes required as a result of an Regulatory Authority’s order, provided CBSB promptly notifies Tercica of any such proposed change and consults with Tercica before implementation of such changes and its potential impact on Drug Substance.		X
6.1 Master Production Record

	Provide appropriate documentation and instruction	X

		Responsible Party
Item	Activity	Tercica	CBSB
	necessary to generate MPR

	Draft and maintain MPR		X

	Review and approve MPR	X	X

6.2 Testing and Sampling specifications

	Provide appropriate documentation and instruction necessary to generate test methods and specifications	X	X

	Draft standard test methods and specifications		X

	Review and approve standard test methods and specifications	X	X

6.3 Packaging and Labeling specifications

	Prepare draft packaging and labeling specifications	X

	Approve label and packaging specifications	X	X

	Implement packaging and labeling procedures		X

6.4 Specification Approval

	Provide preliminary Raw Material and Drug Substance specifications	X

	Prepare draft specifications		X

	Review and approve specifications	X	X

6.5 Facility Changeover

	Notify Tercica of any changes in the types of products being manufactured in the CBSB Facility and using the same suites and/or equipment		X

	Perform cleaning validation studies as necessary to demonstrate and document suitable clearance of other products for the equipment used for Tercica.		X

6.6 Documentation Distribution

	Distribute final Drug Substance/stability specifications on a periodic basis, or as needed	X

6.7 Compendial Compliance

	Review compendial requirements on an annual basis	X	X

6.8 Regulatory Filing Requirements

	Prepare Regulatory Filing documents for Product.	X

	Prepare Facility Description (as needed), CBSB Facility reference files, or CBSB Facility registrations		X

	Review and comment on CMC documents that Tercica intends to register and ensure that these documents conform to the intended responsibilities of CBSB .		X

	Maintain Regulatory Filings, analytical methods, specifications, etc. Supplement Product registration to update commitments, methods, records or specifications based upon Regulatory Requirements defined in 21 CFR Part 314.	X

	Maintain accurate Manufacturing Process records which reflect the methods, the Manufacturing Process and specifications as contained in the Regulatory Filings by submitting all Drug Substance specific document change requests to Tercica prior to approval, implementation and use.		X

6.9 Annual Update Requirements

	Provide notification of Annual Report submission date, and list of required information	X

	Prepare annual update [*] prior to Annual Report target submission date		X

	Prepare Annual Report for submission to Regulatory Authorities	X

7 Materials

	Establish quality requirements for Raw Materials, Resins, Manufacturing Process components, and packaging material.	X

	Establish Material Specifications.		X

	Establish a supplier qualification program for suppliers of all Raw Materials and Resins to be used in the Manufacturing Process.		X

	Promptly notify Tercica of supplier change notifications, if CBSB receives supplier change notices.		X

	Approve supplier changes	X	X

	Ensure that all Raw Materials, Resins, and applicable Consumables, and applicable packaging component suppliers are qualified or reviewed according to defined requirements and procedures, and to maintain a file of supplier qualifications		X

	Prepare and maintain a bill of materials that includes specifications and acceptable grades for required Raw Materials, Resins and Consumables.		X

	Perform Raw Material, Resins, and Consumables procurement, quality control testing, and handling and submission of samples to outside testing laboratories (as applicable).		X

	Maintain Raw Materials (excipients and active), components and packaging material by standard operating procedures that define receipt, handling, sampling, release/rejection, and storage to ensure traceability, control and accountability is maintained.		X

	Maintain programs and procedures for returning unused or damaged Raw Materials, Resins and/or Consumables.		X

	Maintain and archive Raw Material, Resins and Consumables Certificates of Analysis.		X

	Inform Tercica if potentially hazardous materials are to be stored in proximity to Drug Substance, Raw Materials or Resins, and take appropriate steps to assure prevention of cross contamination		X

	Obtain approval from Tercica if CBSB needs to subcontract the analytical release testing of Raw Materials		X

*	This provision is the subject of a Confidential Treatment Request.

	or Resins

	Qualify Subcontractor per CBSB standard operating procedure		X

8 Drug Substance Specifications

	Establish and approve Drug Substance specifications	X	X

	Perform regular testing according to validated procedures and the MPR		X

9 Manufacture and Packaging of the Drug Substance

	Maintain training records for all personnel that perform cGMP functions relating to the Manufacturing Process performed at the CBSB Facility, including personnel in quality assurance, quality control, manufacturing, etc.		X

	Provide access to floor plans, equipment validation for equipment used in the Manufacturing Process, and other appropriate production information at the CBSB Facility.		X

	Schedule Campaigns and prepare a manufacturing schedule based on rolling forecasts provided by Tercica.		X

	Ensure all manufacturing operations are conducted in compliance with cGMPs, standard operating procedures and the MPR.		X

	Maintain relevant standard operations procedures.		X

	Observe operations on an as needed basis and notify CBSB in advance.	X

	Generate a copy of the Batch Record after CBSB’s Quality Review and Approval, and provide to Tercica for each Batch.		X

10 Testing of the Drug Substance

	Transfer test methods to CBSB	X

	Qualify all in-process test methods		X

	Validate all final Drug Substance test methods		X

	Review and approve test methods.	X	X

	Generate reference material characterization/qualification protocol	X

	Characterize and perform qualification of reference material		X

	Maintain reference material as specified in the Storage Guidelines or SOP, as appropriate		X

	Store quality control retain samples for specified time period		X

11 Notification and Approval of Deviations and Failures

11.1 Deviations

	Ensure a thorough investigation and justification of any Deviation		X

*	This provision is the subject of a Confidential Treatment Request.

	Ensure all ICARS are reviewed and completed prior to completion of the Batch Record review		X

	Promptly notify Tercica within [*] days of initiation of investigation of any Deviation or ICAR that affects the Drug Substance being tested.		X

	Provide technical, compliance and regulatory oversight in support of the investigation	X

	Hold and segregate Raw Materials, Resins, Consumables or Drug Substance that do not conform to Material Specifications, in-process specifications, or Drug Substance specifications, as applicable.		X

	Review and approve Raw Materials, Resins, Consumables, or Drug Substance Batch as an outcome of an approved investigation report.	X	X

	Disposition Drug Substance as an outcome of the approved investigation	X

11.2 Failures

	Establish procedures for approving/rejecting failed Batches of Raw Material, Resins, Consumables or Drug Substance.		X

	Promptly notify Tercica of cause for investigation and proposed action plan for Raw Material, Resins, Consumables, or Drug Substance failures.		X

	Participate in Drug Substance investigations, as needed.	X

	Generate ICAR.		X

	Review and approve ICAR	X	X

	Disposition Drug Substance Batch	X

12 QA Review and Approval and Shipment of Drug Substance

	Perform Quality Review and Approval according to approved procedures		X

	Generate COC		X

	Provide a Certificate of Compliance (COC) and copies of Batch Records, Deviations and ICARS, and any applicable documentation within 1 week of CBSB’s QA Review and Approval		X

	Perform Tercica QA review; inform CBSB of any issues within [*] weeks of receipt of Batch Record	X

	Respond to or resolve any issues received from Tercica within [*] weeks, or in a mutually agreeable time frame		X

	Generate COA	X

	Generate COR	X

	Perform Drug Substance release and disposition	X

	Ship Drug Substance to specified site per standard operating procedures		X

13 Retained Samples of the Drug Substance

	Specify the quantity and number of sample retains per	X

*	This provision is the subject of a Confidential Treatment Request.

	Batch, and the retain period.

	Store retain samples as specified.		X

14 Storage of Drug Substance / Environmental Monitoring

	Define storage conditions for Drug Substance.	X

	Securely store Drug Substance under controlled temperature and storage conditions.		X

	Establish and maintain an appropriate environmental monitoring program		X

	Provide Tercica with environmental monitoring records as requested.		X

15 Stability Activities

	Prepare stability protocols.		X

	Review and approve stability protocols	X	X

	Conduct stability studies per approved protocols.		X

	Analyze data on an interim basis, and provide periodic updates to Tercica.		X

	Prepare final stability reports.		X

	Review and approve stability reports.	X	X

	Provide stability updates to Regulatory Authorities in Annual Reports, or as needed.	X

16 Process Validation and Qualification

	Prepare Process Validation Plan (PVP)	X	X

	Review and approve PVP	X	X

	Generate process validation protocols		X

	Review and approve process validation protocols	X	X

	Perform validation studies per approved protocols.		X

	Generate validation data in a timely fashion and maintain raw data and supporting documentation		X

	Prepare validation reports.		X

	Review and approve all final reports.	X	X

17 Annual Product Review

	Provide CBSB with detail of information needed for Annual Product Review	X

	Prepare Annual Product Review per standard procedures and provide to Tercica [*] days before targeted submission date.		X

	Submit Annual Product Review to Regulatory Authorities.	X

18 Product Complaints

	Receive notice of complaints	X

	Inform CBSB within [*] days, or sooner as required, of complaints involving potential Product tampering or adverse medical event	X

	Perform investigation and provide a written report within [*] days	X	X

	Maintain a record of all complaints, and notify Regulatory	X

*	This provision is the subject of a Confidential Treatment Request.

	Authorities as required.

19 Returned Product

	Instructions on handling and returned Product will be specified and documented by Tercica	X

20 Recall of Product

	Notify CBSB, Regulatory Authorities, and customers, and all relevant Third Parties of Product recall.	X

	Perform investigation.	X	X

	Maintain copies of all recall investigations performed on behalf of Tercica and as required by pertinent regulations.		X

21 Audits and Inspections of the CBSB Facility and Drug Substance

	Perform audit of CBSB on [], or as needed on a “for cause” basis, with [] days advance notice provided by Tercica	X

	Conduct periodic audits of critical Raw Material and Resin supplier’s quality systems, [*]. Tercica may participate in supplier audits on an as needed basis		X

	Manage, coordinate and host Regulatory Authority inspections: PAI, general cGMP, for-cause, and EMEA cGMP inspections etc.		X

	Support Product specific PAI or other inspection with at least [*] Tercica staff at the CBSB Facility during the inspection. As appropriate, Tercica staff will be permitted to respond to Product specific questions and participate in wrap up sessions.	X

	Notify Tercica within [*] of receipt of notification of inspection by Regulatory Authorities for inspections related to the Drug Substance or the Manufacturing Process.		X

	Provide a copy of appropriate and redacted Regulatory Authority inspection observations to Tercica within [*] day of inspection.		X

	Prepare written responses to Regulatory Authority actions specific to the CBSB Facility, operations and CBSB Facility specific, non-Tercica related processes		X

	Prepare, review, and approve responses to Regulatory Authority observations issued directly to CBSB. Respond to PAI observations within [] days and all other inspection observations within [] days or the time specified by the Regulatory Authority, which ever is less.		X

	Support Product specific Regulatory Authority inspections and participate in the development of Product specific responses or inquiries.	X	X

	Support the preparation of Regulatory Authority responses that support inquires made to Tercica by Regulatory Authorities	X	X

22 Reprocessing/Rework

	Initiate Reprocessing/Rework request	X	X

*	This provision is the subject of a Confidential Treatment Request.

	Document rationale, justification, and directions for Reprocessing/Rework	X	X

	Approve Reprocessing/Rework	X	X

23 Shipping

	Establish and maintain Shipping Guidelines		X

	Approve shipping configuration and procedures.	X	X

	Package Drug Substance for shipment to specified site. Store and transport Drug Substance to conform to Storage and Shipping Guidelines.		X

	Request shipment of Drug Substance, specifying Shipping Date, shipping address, Batch number, quantity, etc.	X

	Ship Drug Substance per specified request. Track shipment, and provide Tercica with confirmation of shipment.		X

[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]	[*]

[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]	[*]

[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]	[*]
[*]	[*]	[*]	[*]	[*]