Master Manufacturing Services Agreement by and between Keryx Biopharmaceuticals, Inc. and Patheon Manufacturing Services LLC and certain of its affiliates, dated September 27, 2016, and related Product Agreement dated September 27, 2016, and related Product Agreement dated October 12, 2016

a business entity which owns, directly or indirectly, a controlling interest in a party to this Agreement, by stock ownership or otherwise; or

a business entity which is controlled by a party to this Agreement, either directly or indirectly, by stock ownership or otherwise; or

a business entity, the controlling interest of which is directly or indirectly common to the majority ownership of a party to this Agreement;

Parts 210 and 211 of Title 21 of the United States' Code of Federal Regulations;

EC Directive 2003/94/EC; and

Division 2 of Part C of the Food and Drug Regulations (Canada);

specifications for Active Materials and Components;

manufacturing specifications, directions, and processes;

storage requirements;

-    Technical Dispute Resolution

-    Monthly Active Materials Inventory Report    

-     Report of Annual Active Materials Inventory Reconciliation and Calculation of Actual Annual Yield

-    Example of Price Adjustment Due to Currency Fluctuation

Conversion of Active Materials and Components. Patheon will convert Active Materials and Components into Products.

Quality Control and Quality Assurance. Patheon will perform the quality control and quality assurance testing specified in the Quality Agreement. Batch review and release to Client will be the responsibility of Patheon’s quality assurance group. Patheon will perform its batch review and release responsibilities in accordance with Patheon’s standard operating procedures. Prior to shipment of Products to Client, Patheon will provide to Client a certificate of analysis, certificate of origin (BSE / TSE statement) and a certificate of compliance, including a statement that the batch has been manufactured and tested in accordance with Specifications and cGMPs. Client Quality Assurance will review such documents prior to release. For routine or standard batches with no major issues or only minor deviations, Client will use good faith efforts to release the batches within 5 Business Days, or as otherwise agreed. Client will have sole responsibility to authorize a shipment from the manufacturing site and for the release of Products to the market. The form and style of batch documents, including, but not limited to, batch production records, lot packaging records, equipment set up control, operating parameters, and data printouts, raw material data, and laboratory notebooks are the exclusive property of Patheon. Specific Product related information contained in those batch documents is Client property. Notwithstanding the foregoing, Client may make reasonable requests and shall be entitled to review the raw testing data, and other information set forth in the Quality Agreement.

Components. Patheon will purchase and test all Components (with the exception of Client-Supplied Components) at Patheon's expense and as required by the Specifications.

Stability Testing. Patheon will conduct stability testing on the Products in accordance with the protocols set out in the Specifications for the separate fees and during the time periods set out in Schedule C to a Product Agreement. Patheon will not make any changes to these testing protocols without prior written approval from Client. If a confirmed stability test failure occurs, Patheon will notify Client within one Business Day, after which Patheon and Client will jointly determine the proceedings and methods to be undertaken to investigate the cause of the failure, including which party will bear the cost of the investigation. The parties will use good faith efforts to determine the root cause of any failures and to allocate the costs. Patheon will give Client all stability test data and results at Client’s request.

Packaging and Artwork. Patheon will package the Products as set out in the Specifications. Client will be responsible for the cost of artwork development. Patheon will determine and imprint the batch numbers and expiration dates for each Product shipped. The batch numbers, expiration dates, serialization numbers, and 2D bar codes will be affixed on the Products and on the shipping carton of each Product as outlined in the Specifications and as required by cGMPs. Client may, in its sole discretion, make changes to labels, product inserts, and other packaging for the Products. Those changes will be submitted by Client to all applicable Regulatory Authorities and other third parties responsible for the approval of the Products. Client will be responsible for the cost of labelling obsolescence when changes occur, as contemplated in Section 4.4. Patheon's name will not appear on the label or anywhere else on the Products unless: (i) required by any Laws; or (ii) Patheon consents in writing to the use of its name. At least 90 days prior to the Delivery Date of Product for which new or modified artwork is required, Client will provide at no cost to Patheon, final camera ready artwork for all packaging Components to be used in the manufacture of the Product that meet the Specifications. For the avoidance of doubt, the parties acknowledge and agree that Client will be responsible for complying with any and all regulatory requirements for the labeling of the Product.

Active Materials and Client-Supplied Components.  At least [***] before the scheduled production date, Client will deliver the Active Materials and any Client-Supplied Components to the Manufacturing Site DDP (Incoterms 2010), at no cost to Patheon, in sufficient quantity to enable Patheon to manufacture the desired quantities of Product and to ship Product on the Delivery Date. If the Active Materials and/or Client-Supplied Components are not received [***] before the scheduled production date, Patheon may delay the shipment of Product by the same number of days as the delay in receipt of the Active Materials and/or Client-Supplied Components. But if Patheon is unable to manufacture Product to meet this new shipment date due to prior third party production commitments, Patheon may delay the shipment until a later date as agreed to by the parties. All shipments of Active Material will be accompanied by certificate(s) of analysis from the Active Material manufacturer and the Client, confirming the identity and purity of the Active Materials and its compliance with the Active Material specifications. For Active Materials or Client-Supplied Components which may be subject to import or export, Client agrees that its vendors and carriers will comply with applicable requirements of the U.S. Customs and Border Protection Service and the Customs Trade Partnership Against Terrorism.

Validation Activities (if applicable). Patheon shall assist in the development and approval of the validation protocols for analytical methods and manufacturing procedures (including packaging procedures) for the Products. The fees for this service are not included in the Price and will be set out separately in Schedule C to a Product Agreement.

Additional Services. If Client requests services other than those expressly set forth herein or in any Product Agreement (such as qualification of a new packaging configuration or shipping studies, or validation of alternative batch sizes), Patheon will provide a good faith and reasonable written quote of the fee for the additional services and Client will advise Patheon whether it wishes to have the additional services performed by Patheon. The scope of work and fees will be set forth in a separate agreement signed by the parties. If so agreed by the parties, the terms and conditions of this Agreement will apply to these services. Such additional services or items not included in the costs may include, but are not limited to, third party supplier fees for the purchase or use of columns, standards, tooling, non-standard pallets, PAPR or PPE suits (where applicable) and other project-specific items necessary for Patheon to perform the Manufacturing Services, and which are not included as Components.

Reporting. Patheon will give Client a monthly inventory report of the Active Materials held by Patheon using the inventory report form set out in Exhibit C, which will contain the following information for the month by lot number:

Shortfall Credit Calculation. If the Actual Annual Yield falls more than the Yield Tolerance (set forth in the Product Agreement) below the respective Target Yield, then the shortfall for the Year (the "Shortfall") will be calculated as follows:

Surplus Calculation. If the Actual Annual Yield is more than the respective Target Yield in a Year, then the surplus for that Year (the "Surplus") will be determined based on the following calculation:

Maximum Credit. Patheon's liability for Active Materials calculated in accordance with this Section 2.2 for any Product in a Year will not exceed, in the aggregate, the Maximum Credit Value set forth in Schedule D to a Product Agreement.

No Material Breach. It will not be a material breach of this Agreement by Patheon under Section 8.2(a) solely because the Actual Annual Yield is less than the Target Yield, so long as the Shortfall is not the result of Patheon failing to meet any obligation set forth in this Agreement.

Client will at its sole cost and expense deliver the Active Materials to Patheon in accordance with Section 2.1(f). If applicable, Patheon and the Client will reasonably cooperate to permit the import of the Active Materials to the Manufacturing Site. Client’s obligation will include obtaining the proper release of the Active Materials from the applicable Customs Agency and Regulatory Authority. Client or Client’s designated broker will be the “Importer of Record” for Active Materials imported to the Manufacturing Site. The Active Materials will be held by Patheon on behalf of Client as set forth in this Agreement. Title to the Active Materials will at all times remain the property of Client. Any Active Materials received by Patheon will only be used by Patheon to perform the Manufacturing Services. Client will be responsible for paying for all rejected Product that arises from defects in the Active Materials which could not be reasonably discoverable by Patheon using the test methods set forth in the Specifications.

Manufacturing and Stability Testing Costs. For Products manufactured in the United States or Puerto Rico, Patheon may adjust the conversion component of the Price and the annual stability testing costs for inflation, based upon the preliminary number for any increase in the Producer Price Index pcu325412325412 for Pharmaceutical Preparation Manufacturing (“PPI”) published by the United States Department of Labor, Bureau of Labor Statistics in August of the preceding Year compared to the final number for the same month of the Year prior to that, unless the parties otherwise agree in writing. On or before [***], Patheon will give Client a statement setting forth the calculation for the inflation adjustment to be applied in calculating the Price for the next Year. For Products manufactured outside the United States or Puerto Rico, Patheon may similarly adjust the Price for inflation using an inflation index to be agreed by the parties in a Product Agreement.

Component Costs. If Patheon incurs an increase in Component costs during the Year, it may increase the Price for the next Year to pass through the additional Component costs at Patheon’s actual cost. If Patheon obtains a decrease in Component costs during the Year, it will decrease the Price for the next Year to pass through [***] of the cost savings to the Client. On or before [***], Patheon will give Client information about the increase or decrease in Component costs which will be applied to the calculation of the Price for the next Year to reasonably demonstrate that the Price increase or decrease is justified. But Patheon will not be required to give information to Client that is subject to obligations of confidentiality between Patheon and its suppliers.

Pricing Basis. Client acknowledges that the Price in any Year is quoted based upon the Minimum Order Quantity and the Annual Volume specified in Schedule B to a Product Agreement. The Price is subject to change if the specified Minimum Order Quantity changes or if the Annual Volume is not ordered in a Year. For greater certainty, if Patheon and Client agree that the Minimum Order Quantity will be reduced or the Annual Volume in the lowest tier will not be ordered in a Year whether as a result of a decrease in estimated Annual Volume or otherwise and, as a result of the reduction, Patheon demonstrates to Client that its costs to perform the Manufacturing Services or to acquire the Components for the Product will increase on a per unit basis (including the amount of the increase), then Patheon may increase the Price by an amount sufficient to absorb the documented increased costs. On or before [***], Patheon will give Client a statement and sufficient justification setting forth the information to be applied in calculating those cost increases for the next Year, and the parties will use good faith efforts to approve any such increases. Such cost increase must be approved by Client in advance of cost increases going into effect; provided however, the price increase will not be unreasonably denied if the foregoing process is used and justified. Patheon will not be required to give information to Client that is subject to obligations of confidentiality between Patheon and its suppliers.

Adjustments Due to Currency Fluctuations. If the parties agree in a Product Agreement to invoice in a currency other than the local currency for the Manufacturing Site, Patheon will adjust the Price to reflect currency fluctuations. The adjustment will be calculated after all other annual Price adjustments under this Section 4.2 have been made. The adjustment will proportionately reflect the increase or decrease, if any, in the Set Exchange Rate compared to the Set Exchange Rate established for the prior Year or the Initial Set Exchange Rate, as the case may be. An example of the calculation of the price adjustment (for a Canadian Manufacturing Site invoiced in USD) is set forth in Exhibit E.

Tier Pricing (if applicable). The pricing in Schedule B of a Product Agreement is set forth in Annual Volume tiers based upon the Client’s volume forecasts under Section 5.1.  The Client will be invoiced during the Year for the unit price set forth in the Annual Volume tier based on the [***] forecast provided in [***].  Within [***], Patheon will send Client a reconciliation of the actual volume of Product ordered by the Client during the Year with the pricing tiers.  If Client has overpaid during the Year, Patheon will issue a credit to the Client for the amount of the overpayment [***] or will issue payment to the Client for the overpayment [***].  If Client has underpaid during the Year, Patheon will issue an invoice to the Client under Section 5.6 for the amount of the underpayment [***].  If Client disagrees with the reconciliation, the parties will work in good faith to resolve the disagreement amicably. If the parties are unable to resolve the disagreement [***], the matter will be handled under Section 12.1.

Technical Changes to Requirements. Technical changes requested by Client will only be implemented following a technical and cost review that Patheon will perform and are subject to Client and Patheon reaching agreement on Price changes required because of the amendment. Technical changes requested by Patheon will only be implemented following an assessment by Patheon and the Client regarding the technical changes that may have an effect on certain areas including, but not limited to Regulatory filings, fees, etc. All technical changes requested by Patheon require the written approval of Client, the approval not to be unreasonably withheld. If Client accepts a proposed Price change, the proposed change in the Specifications and the associated scope of work will be implemented at Client’s cost. All costs relating to the technical changes, including re-validations of the process, or stability program shall be determined by the parties after good faith discussions, and the Price change will become effective only for those orders of Products that are manufactured under the revised Specifications. In addition, Client agrees to purchase, at Patheon's cost (including all costs incurred by Patheon for the purchase and handling of the Inventory), all Inventory for Firm Orders used under the "old" Specifications and purchased or maintained by Patheon in order to fill Firm Orders or under Section 5.2, if the Inventory can no longer be used under the revised Specifications. Open purchase orders for Components no longer required under any revised Specifications that were placed by Patheon with suppliers in order to fill Firm Orders or under Section 5.2 will be cancelled where possible, and if the orders may not be cancelled without penalty, will be assigned to and satisfied by Client.

Regulatory Changes to Authority Requirements. Regulatory changes to the Specifications requested by Client will be implemented immediately, and will be followed by a good faith effort from both parties to evaluate the cost impact. Regulatory changes to the Manufacturing Site will only be implemented following the written approval of Client, the approval not to be unreasonably withheld. The cost of any such changes shall be agreed to in advance by the parties after good faith discussions.

Long Term Forecast. When each Product Agreement is executed, Client will give Patheon a non-binding [***] forecast of Client’s volume requirements for the Product for the [***] of the term of the Product Agreement (the “Long Term Forecast”). The Long Term Forecast will thereafter be updated annually, [***]. If Patheon is unable to accommodate any portion of the Long Term Forecast, it will notify Client and the parties will agree on any revisions to the forecast.

Rolling [***] Forecast. When each Product Agreement is executed, Client will give Patheon a non-binding [***] forecast of the volume of Product that Client expects to order in the [***] of commercial manufacture of the Product. This forecast will then be updated by Client on or before the [***] on a rolling forward basis. Client will update the forecast forthwith if it determines that the volumes estimated in the most recent forecast have changed by more than [***]. The most recent [***] forecast will prevail.

Firm Orders. On a rolling basis during the term of the Product Agreement, Client will issue an updated [***] forecast on or before the [***]. This forecast will start on [***]. Unless otherwise agreed in the Product Agreement, the first [***] of this updated forecast will be considered binding firm orders. Concurrent with the [***] forecast, Client will issue a new firm written order in the form of a purchase order or otherwise (“Firm Order”) by Client to purchase and, when accepted by Patheon, for Patheon to manufacture and deliver the agreed quantity of the Products. The Delivery Date will not be less than [***] following the date that the Firm Order is submitted. Firm Orders submitted to Patheon will specify Client's purchase order number, quantities by Product type, monthly delivery schedule, and any other elements necessary to ensure the timely manufacture and shipment of the Products. The quantities of Products ordered in those written orders will be firm and binding on Client and may not be reduced by Client. Further, for [***] of the [***] forecast, Client commits that its Firm Orders for each of those months will be no less than [***], respectively, of the forecasted amounts for [***].  If Client orders less than the agreed volume, the parties will meet to discuss how to smooth production to meet demand. If it is not possible to smooth production to meet forecasted demand, Client will compensate Patheon for not meeting the Firm Order commitment by paying the [***] for the shortfall between what Client actually ordered and its Firm Order commitment as set forth above or as otherwise provided for in the applicable Product Agreement. The forgoing shall be Patheon’s sole and exclusive remedy for Client’s failure to meet the Firm Order commitment. No amounts shall be payable to Patheon if Client is unable to make the Firm Order commitment because of Force Majeure or because the Product is taken off the market due in response to an action by an Authority or otherwise as required by Applicable Law. Patheon commits to make [***] of the forecasted amounts available to Client, and will reserve [***] of its capacity to meet that commitment. Patheon shall notify Client as soon as possible of impending capacity constraints in relation to Client’s forecasts and/or changes in Client’s demands.

Acceptance of Firm Order. Patheon will accept Firm Orders by sending an acknowledgement to Client within [***] of its receipt of the Firm Order. The acknowledgement will include, subject to confirmation from the Client, the Delivery Date for the Product ordered. The Delivery Date may be amended by agreement of the parties or as set forth in Section 2.1(f). If Patheon fails to acknowledge receipt of a Firm Order within the [***] period, the Firm Order will be deemed to have been accepted by Patheon.

Cancellation of a Firm Order. Except for [***], if Client cancels a Firm Order, Client will pay Patheon the [***] for the Firm Order. For purposes of this provision, [***] . Patheon will use commercially reasonable efforts to mitigate all costs related to a cancellation of a Firm Order and to deploy its resources to other clients.

On Time Delivery.

Zero Volume Forecast. If Client forecasts zero volume for [***] (the “Zero Forecast Period”), then Patheon will have the option, at its sole discretion, to provide a [***] notice to Client of Patheon’s intention to terminate the Product Agreement on a stated day within the Zero Forecast Period. Client thereafter will have [***] to either (i) withdraw the zero forecast and re-submit a reasonable volume forecast, or (ii) negotiate other terms and conditions on which the Product Agreement will remain in effect. Otherwise, Patheon will have the right to terminate the Product Agreement at the end of the [***] notice period.

Client will take delivery of and pay for all undelivered Products that are manufactured and/or packaged under a Firm Order, at the price in effect at the time the Firm Order was placed;

Client will purchase, at Patheon's cost plus [***] handling fee, the Inventory applicable to the Products which was purchased, produced or maintained by Patheon in contemplation of filling Firm Orders or in accordance with Section 5.2 prior to notice of termination being given; provided that Patheon will make commercially reasonable efforts to mitigate any costs payable by Client in connection therewith, which may include canceling any pending orders for such Components, returning or selling items in the Inventory back to its supplier(s) if possible, or otherwise utilizing such Inventory or Components with other Patheon clients or otherwise in Patheon’s business;

Client will satisfy the purchase price payable under Patheon's orders with suppliers of Components, if the orders were made by Patheon in reliance on Firm Orders or in accordance with Section 5.2, and thereafter Client will have sole right, title and interest in and to such Components;

Client acknowledges that no Patheon Competitor will be permitted access to the Manufacturing Site;

Client will make commercially reasonable efforts, at its own expense, to remove from Patheon site(s), [***], all unused Active Material and Client-Supplied Components, all applicable Inventory and Materials (whether current or obsolete), supplies, undelivered Product, chattels, equipment or other moveable property owned by Client, related to the Agreement and located at a Patheon site or that is otherwise under Patheon’s care and control (“Client Property”). If Client fails to remove the Client Property [***] following the completion, termination, or expiration of the Product Agreement, Client will pay Patheon [***] per pallet, per month, one pallet minimum (except, if applicable, Client will pay [***] per pallet, per month, one pallet minimum, for any of the Client Property that contains controlled substances, requires refrigeration or other special storage requirements) thereafter for storing the Client Property and will assume any third party storage charges invoiced to Patheon regarding the Client Property; provided that no such charges shall be applicable and payable by Client if Client notifies Patheon to destroy/dispose of such Client Property. Patheon will invoice Client for the storage charges as set forth in Section 5.5 of this Agreement;

Pursuant to a reasonable written request from Client to Patheon, Patheon shall transfer to Client and/or its designee any and all Client Intellectual Property in Patheon’s possession and shall provide to Client and/or its designee Patheon Intellectual Property, so as to permit Client and/or its designee(s) to produce/manufacture Products with such technical assistance being provided in accordance with a plan provided to Patheon by Client. To the extent transferable, Patheon shall also transfer any license(s) obtained specifically for the production/manufacture of Products under this Agreement. Patheon hereby grants to Client [***] any and all Patheon Intellectual Property to make, have made, use, offer for sale, sell, and import Products, which license shall survive termination of this Agreement. However, no Competitor of Patheon in the business of contract development or manufacture of drug products will be permitted to have access to Patheon’s manufacturing site. The third party manufacturer will be required to sign a customary and appropriate confidentiality agreement with Patheon concerning the nondisclosure of Patheon confidential information that may be involved in the transfer;

Except to the extent necessary to complete performance pursuant to subsection (f) or to exercise rights that survive the termination of this Agreement, each party as a receiving party shall deliver to the disclosing party such disclosing party’s Confidential Information in the receiving party’s possession or control. Notwithstanding anything in this Agreement that may be to the contrary, Client (and its designees) may continue to retain and use Patheon Confidential Information that is required to maintain marketing approval for a Product and/or is useful to production/manufacture of the Product;

Promptly following any notice of termination of expiration, Patheon will update and confirm the technical information and specifications for the Product as set forth in the Specifications (Schedule A), Stability Testing protocols and procedures (Schedule C) and the Quality Agreement (Exhibit B) as applicable, to the extent required to reflect any needed changes to manufacturing and validation methods;

Each party will continue to comply with their obligations under Applicable Law which survive termination of this Agreement;

Non-Infringement.

Quality and Compliance.

Patheon may not assign this Agreement or any Product Agreement or any of its associated rights or obligations without the written consent of Client, this consent not to be unreasonably withheld. But Patheon may arrange for subcontractors to perform specific testing services arising under any Product Agreement with the consent of Client, not to be unreasonably delayed or withheld. Further it is specifically agreed that Patheon may subcontract any part of the Manufacturing Services under a Product Agreement to any of its Affiliates.

Subject to Section 13.6(a), Client may assign this Agreement or any Product Agreement or any of its associated rights or obligations without approval from Patheon. But Client will give Patheon prior written notice of any assignment, any assignee will covenant in writing with Patheon to be bound by the terms of this Agreement or the Product Agreement, and Client will remain liable hereunder. Any partial assignment of this Agreement or a Product Agreement will be subject to Patheon’s cost review of the assigned Products, such review to be performed on an expeditious basis. Client will reimburse Patheon for any costs incurred by Patheon in connection with the partial assignment including any expenses incurred by Patheon for any due diligence audits in connection with the partial assignment.

Despite the foregoing provisions of this Section 13.6, either party may assign this Agreement or any Product Agreement to any of its Affiliates or to a successor to or purchaser of all or substantially all of its business, but the assignee must execute an agreement with the non-assigning party whereby it agrees to be bound hereunder.

any Tax based on net income or gross income that is imposed on Patheon by its jurisdiction of formation or incorporation ("Resident Jurisdiction");

any Tax based on net income or gross income that is imposed on Patheon by jurisdictions other than its Resident Jurisdiction if this tax is based on a permanent establishment of Patheon; and

any Tax that is recoverable by Patheon in the ordinary course of business for purchases made by Patheon in the course of providing its Services, such as Value Added Tax (as more fully defined in subparagraph (d) below), Goods & Services Tax ("GST") and similar taxes.