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Exhibit 99.1
AMENDMENT NO. 1 TO
COMPOUND SUPPLY AND LICENSE AGREEMENT
This Amendment No. 1, dated as of August 14, 2000 (the "Effective Date"),
is between ArQule, Inc. ("ArQule"), a Delaware Corporation, and the R.W. Johnson
Pharmaceutical Research Institute ("PRI"), a division of Ortho-McNeil
Pharmaceutical, Inc., a Delaware Corporation.
R E C I T A L S
WHEREAS, PRI and ArQule entered into a Compound Supply and License
Agreement dated December 15, 1998 (the "Agreement") pursuant to which, among
other things, ArQule supplies PRI with Mapping Array Sets (as defined in the
Agreement);
WHEREAS, ArQule has developed compound libraries that constitute diverse
subsets of its Mapping Array Sets, which ArQule has named Compass Array Sets (as
defined below);
WHEREAS, PRI desires to access Compass Array Sets that correspond to
Mapping Array Sets produced by ArQule after June 30, 1999 and thereafter during
the term of the Agreement, and ArQule is willing to furnish PRI with such
Compass Array Sets under the terms and conditions of this Amendment; and
WHEREAS, PRI and ArQule desire to make certain other revisions to the
Agreement, as specified in this Amendment.
NOW, THEREFORE, in consideration of the mutual covenants set forth in this
Amendment, PRI and ArQule hereby agree as follows:
1. DEFINITIONS. Capitalized terms used in this Amendment and not otherwise
defined herein shall have the meanings ascribed to such terms in the Agreement.
1.1. Section 1.4 of the Agreement is hereby deleted and replaced with the
following:
"ARQULE COMPOUND" means a chemical compound provided by ArQule to
PRI under this Agreement, and specifically includes all compounds
in the Mapping Array Sets and Compass Array Sets provided to PRI
under the Mapping Array Program.
1.2. The following definition is hereby added to the Agreement:
"COMPASS ARRAY(TM) SET" means a set of ArQule Compounds
consisting of a diverse subset of each Mapping Array Set produced
by ArQule. Each Compass Array Set currently includes at least
approximately ***** of the total ArQule Compounds in
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the corresponding Mapping Array Set to represent the chemical
diversity present in that Mapping Array Set.
2. The following caption, "3.1 Delivery of Array Sets," is hereby added under
the caption, "3. Conduct of Mapping Array Program."
3. Section 3.1. is hereby redesignated Subsection 3.1.2.
4. The following subsection is hereby added to the Agreement:
3.1.1. DELIVERY OF COMPASS ARRAY SETS. ArQule shall furnish PRI
with approximately ***** solution in DMSO of each ArQule Compound that is
within the Compass Array Sets corresponding to the Mapping Array Sets
delivered to PRI from ***** during the term of the Agreement. The Compass
Array Sets are delivered in 96 well microtiter plate format. The ArQule
Compounds in each Compass Array Set shall have an average purity level of
at least ***** as measured by standard analytical chemistry methods used
at ArQule. ArQule shall use diligent efforts to deliver to PRI the Compass
Array Sets as follows:
(i) within ***** days after the Effective Date of this Amendment for
Compass Array Sets corresponding to the Mapping Array Sets delivered
to PRI from ***** through *****;
(ii) within ***** days after the Effective Date of this Amendment for
Compass Array Sets corresponding to the Mapping Array Sets delivered
to PRI from ***** through *****; and
(iii) for Compass Array Sets corresponding to Mapping Array Sets delivered
to PRI after *****, within ***** after PRI receives the corresponding
Mapping Array Set.
Except as provided in Section 3.3. below, ArQule shall have no obligation
to identify the individual ArQule Compounds in the Compass Array Sets and
PRI shall have no obligation to identify its Targets.
5. Section 3.2. is hereby deleted in its entirety and replaced with the
following:
3.2. SCREENING OF ARQULE COMPOUNDS. Subject to the terms and
conditions of this Agreement, ArQule hereby grants PRI and its Affiliates a
nonexclusive, worldwide license (without the right to sublicense) under the
ArQule Patent Rights and other rights in ArQule Technology to screen the
ArQule Compounds in the Compass Array Sets and Mapping Array Sets against
any Targets within the Screening Field. PRI agrees to use efforts
consistent with its normal scientific practices to screen the ArQule
Compounds in
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the Compass Array Sets and Mapping Array Sets against its Targets in the
Screening Field.
6. The following sentence is hereby added to the end of Subsection 3.3.1. of the
Agreement:
"PRI shall confirm its initial screening results for Licensed Compounds
according to its usual internal procedures prior to confirmation with
resynthesized compounds pursuant to Subsection 3.3.2. below. Once PRI
confirms activity for a Licensed Compound, PRI shall disclose to ArQule the
Target and the level of activity for such Licensed Compound.
7. Subsection 3.3.2. is hereby deleted in its entirety and replaced with the
following:
3.3.2. RESYNTHESIZED COMPOUNDS. If PRI requests resynthesized
samples of a Licensed Compound, ArQule will supply PRI with a sufficient
quantity (determined by the Research Committee but not more than ***** ) of
the resynthesized Licensed Compound to confirm activity and perform
secondary assays within ***** from the date requested, unless synthesis
starting materials are unavailable for such resynthesized Active Compound,
subject to a maximum of ***** such requests in any one month. Within *****
days after receiving the resynthesized Active Compound from ArQule to
confirm activity, subject to extension by the Research Committee, PRI shall
notify ArQule whether activity is confirmed.
8. In Subsection 3.3.3. entitled "Activation of Development Licenses", delete
the first sentence and replace with the following:
"If PRI does not confirm activity within the ninety-day confirmation period
for a resynthesized Licensed Compound, or if PRI has no further interest in
that Licensed Compound for any other reason, the Licensed Compound shall
revert to ArQule as provided in Section 7.5.
9. The following subsection is hereby added to the Agreement:
3.3.4. ACTIVITY REPORTS. Within ***** after the conclusion of each calendar
quarter, PRI shall furnish ArQule with a report that sets forth for each
assay type the percentage of Active Compounds identified by PRI during that
quarter in primary screens and confirmatory screens of each Compass Array
Set and Mapping Array Set. For purposes of this Section, the term "assay
type" shall mean a bound receptor, soluble receptor, enzyme, or whole cell
assay.
10. The parties acknowledge and agree that, in accordance with the provisions of
this Amendment, ArQule has been relieved of its obligation to provide PRI with
confirmation samples as originally set forth in the first sentence of Subsection
3.3.2. of the Agreement and has accepted an obligation to furnish PRI with
Compass Array Sets under paragraph 4 of this Amendment (addition of new
Subsection 3.1.1). Accordingly, the parties further agree that the
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***** resupply fee referenced in Section 5.2. of the Agreement as an allocation
of the annual delivery fee shall be substituted by a ***** service fee under
the same terms for the preparation and delivery of the Compass Array Sets
pursuant to this Amendment. This change is merely a change in allocation and
does not affect the total amount of the annual delivery fee or any other payment
terms under the Agreement.
IN WITNESS WHEREOF, the undersigned have duly executed and delivered this
Amendment No. 1 as a sealed instrument effective as of the date first above
written.
R.W. JOHNSON PHARMACEUTICAL RESEARCH INSTITUTE
By: /s/ Geoffrey Dellenbaugh
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Name: Geoffrey Dellenbaugh
Title: Executive Director of External Relations
ARQULE, INC.
By: /s/ Phillipe Bey
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Name: Phillipe Bey
Title: Chief Scientific Officer
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