Sponsored Research and Manufacturing Agreement between Texas Tech University Health Sciences Center and HemoBioTech, Inc. (Phase III, 2006)
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Summary
Texas Tech University Health Sciences Center and HemoBioTech, Inc. have entered into an agreement to continue their joint project to commercialize HemoTech™, a blood substitute product. For the 2006 project phase, Texas Tech will maintain an animal blood donor facility, participate in the FDA Investigational New Drug (IND) process, and manufacture clinical-grade HemoTech™. HemoBioTech will provide funding, with an initial down payment of $286,999, and costs will be adjusted as needed. The agreement is governed by an existing Sponsored Research Agreement and License Agreement between the parties.
EX-10.16 2 c40600_ex10-16.txt EXHIBIT 10.16 HEMOBIOTECH TEXAS TECH - HEMOBIOTECH JOINT BLOOD SUBSTITUTE PROJECT PHASE III: IND PROCESS AND HEMOTECH(TM) MANUFACTURING JANUARY 2006 - DECEMBER 2006
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1. PROJECT DESCRIPTION: The proposed project represents a continuation of the joint effort between Texas Tech University Health Sciences Center (TTUHSC) and HemoBioTech, Inc. with an objective to commercialize HemoTech(TM), the Texas Tech developed blood substitute product. The legal basis for such an 2 activity is the Sponsored Research Agreement (SRA) and License Agreement between Texas Tech University Health Sciences Center (a licensor) and HemoBioTech, Inc (a licensee). After successful completion of PHASE 1(2002-04) of the project that included: o creation of a company structure; o development of the business plan; and o intellectual/scientific/technical support during the process of searching for an initial venture capital; the Texas Tech SRA team led by Dr. Simoni, completed in 2005 PHASE II of the Project, which consisted of: o completion and submission to the U.S. Patent and Trademark Office of a new patent on the method for stimulating erythropoiesis with HemoTech(TM) (PROJECT I), o transfer of the CMC, pre-clinical and clinical research data into digital pdf format (PROJECT II), o analysis and summarization of the CMC, pre-clinical and clinical research data for IND application (PROJECT III), o renovation and sanitation of the Texas Tech Blood Substitute Production Facility (PROJECT IV), and o establishment of the animal blood donor facility (PROJECT V). Each project in Phase I and II was done at Texas Tech University using the Texas Tech intellectual and technical resources. Phase II was paid for by HemoBioTech, Inc. in the amount of $230,503. Texas Tech did not charge HemoBioTech, Inc. for Phase I of the Project. Any unused funds (approx. $41,500) from Phase II will be automatically transferred to the budget of Phase III. 3 On November 11, 2005 the SRA Team was asked to provide further assistance to the licensee, HemoBioTech, Inc. As requested by Dr. Arthur P. Bollon, Chairman, President & CEO of HemoBioTech, Inc., new services provided by Texas Tech to the company should include: PROJECT I: CONTINUATION OF THE NECESSARY ACTIVITIES ASSOCIATED WITH MAINTAINING THE ANIMAL BLOOD DONOR FACILITY IN COOPERATION WITH THE DEPARTMENT OF ANIMAL SCIENCES AT TTU. This facility, which is housing [*] cows, was established in March 2005, is located at [*] and supervised by Dr. Simoni. The detailed maintenance budget for the period January 1, 2006 - December 31, 2006 is presented as ATTACHMENT 1. The maintenance budget for the period of January 1, 2007 - December 31, 2007, and beyond if necessary, will be presented at the end of 2006. PROJECT II: PARTICIPATION IN THE IND PROCESS THAT WILL INCLUDE, BUT NOT BE LIMITED TO: 1. Scientific and technical interaction with and support of CRO groups, which will represent HemoBioTech, Inc. at the FDA level. 2. Manufacturing [*] HemoTech(TM) to conduct possible pre-clinical experiments if mandated by the CRO or FDA. 3. Conducting additional IN VIVO animal pre-clinical studies with HemoTech(TM) if mandated by the CRO or FDA. 4. Conducting additional IN VITRO preclinical studies with HemoTech(TM) if mandated by the FDA. 5. Collaborating with the [*] through a contact with [*] to conduct all necessary histopathological - ---------- * Blank spaces contained confidential information that has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. 4 examinations of the pre-clinical material collected during the European IND, if recommended by the CRO group. 6. Conduct more studies on the interaction of HemoTech(TM) with automated analytical clinical tests, if recommended by the CRO group. 7. Any other activities requested by CRO groups, the FDA, or other involved parties. These activities, according to HemoBioTech's plan, should take place in the first half of 2006. The time for completion of particular tasks can vary and can be more precisely determined after learning the FDA rulings. The SRA Team will do everything possible to supervise and expedite these protocols. The successful realization of these tasks, however, will depend on the availability of adequate funds. At this moment it is impossible to predict the exact cost of these activities, because the recommendations of the FDA have to be released. PROJECT III: MANUFACTURING OF CLINICAL-GRADE HEMOTECH(TM) The animal blood donors and the HemoTech(TM) production facility are generally ready to be used for this activity. The patented HemoTech(TM) manufacturing technology, developed at TTUHSC, will be implemented in this process. HemoTech(TM) manufacturing process will be similar to that described in the CMC documents and will include (see ATTACHMENT 2): o [*] o [*] o [*] - ---------- * Blank spaces contained confidential information that has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. 5 o [*] o [*] o [*] o [*] o [*] o [*] [*]. The FDA decisions will dictate future activities and their associated costs. The exact cost of Project III will depend on the FDA recommended size and number of the HemoTech(TM) [*]. If, for instance, the FDA will recommend [*] larger than [*] liters, the SRA Team should be furnished with the necessary funds to scale up the manufacturing process. The budget presented in the Business Plan contains the provisions for such an eventuality. The scale up process will require purchasing of the necessary production equipment and probably expansion of the production facility within the TTUHSC building. (see BUSINESS PLAN) The number of [*] will depend on the scope of the clinical applications and number of patients selected for HemoTech(TM) in Phase I and Phase IIA of the clinical trials. The FDA recommendations will determine the organizational structure of the HemoTech(TM) production team. As of December 2005, HemoBioTech, Inc. is reimbursing only [*] hours per week for P.I.J. Simoni, [*] hours per week for Sr. Res. Assoc. J.F. Moeller, and [*] hours per week for Med. Res. Assist. G. Simoni. Our 21 years plus experience in the manufacturing of blood substitutes teaches us that its production requires a 24/7 commitment. Therefore, the successful completion of this task - ---------- * Blank spaces contained confidential information that has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. 6 will depend on the ability of HemoBioTech, Inc. to provide the necessary funds to adequately compensate the SRA Team during the manufacturing of clinical-grade product. Moreover, as presented in 2003 to HemoBioTech's Executives the personnel requirements for manufacturing of clinical-grade HemoTech(TM) (ATTACHMENT 3) can increase. If necessary, the SRA Team should have access to funds for hiring of new employees to accommodate the anticipated expansion as presented previously. Therefore, for the above-mentioned and other reasons it is impossible to predict the exact costs of Project III. The necessary budget should include, but not be limited to have free access to funds for any consumables, new production and analytical equipment, services, labor compensation, related overhead and any other relevant expenses needed for satisfactory completion of Project III. However, we are almost sure that the total cost should not exceed the amount presented in the budget of the Business Plan. Therefore, Project III can only be completed successfully if the initial down-payment of $286,999 will be followed by continuous funding necessary to complete this manufacturing work. This task will be initiated in early [*] and completed as Phase IIA becomes resolved. PROJECT IV: ADDITIONAL R&D ON HEMOTECH(TM) As recommended by Dr. Bollon, legal protection for HemoTech(TM) should be continued. After successful completion of the patent application for HemoTech's(TM) related [*] property, which according to the patent lawyers, will provide HemoTech(TM) with another [*] years of protection, the SRA Team already initiated the process of patenting of other therapeutic properties of HemoTech(TM). - ---------- * Blank spaces contained confidential information that has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. 7 Project IV will include the completion of patent applications for HemoTech(TM) induced [*] and HemoTech(TM) [*] property. These tasks should be completed in the year [*]. The cost of these tasks should not exceed $[*] for research expenses excluding labor and patenting costs. PROJECT V: Will contain any other unlisted and as yet unknown intellectual, scientific, technical, managerial and manufacturing activities, which will result from conducting the Phase HI of this project between January 1, 2006 and December 31, 2006. TECHNICAL AND MANAGERIAL RESOURCES: Texas Tech University Health Sciences Center with twenty years of experience in the blood substitute field has all intellectual and almost all technical resources to successfully complete Phase III of the Project. If scale-up will be recommended new production equipment, facility expansion and hiring of new personnel must be funded. FUNDING REQUESTS: The total funds requested for Phase III of the Project cannot be determined at the present time. The down payment of $286,999 will only initiate Phase III of the SRA Project. The exact cost of the entire Phase Ill will be determined during the course of the Project. The budget will be adjusted at least semi-annually and will reflect the dollar amount necessary to cover the costs of the procedures needed to comply with any FDA recommendations regarding the IND and clinical trial stages. Since, as of December 2005, the Texas Tech SRA Team and HemoBioTech, Inc. are unaware of any outcomes - ---------- * Blank spaces contained confidential information that has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. 8 of the future FDA meetings, it is impossible to predict the exact cost of Phase III of the Project. This includes, but is not limited to, the total costs of any consumables, equipment, services, labor compensation, related overhead and any other relevant expenses needed for satisfactory completion of the Project. However, the total cost should not exceed the amount presented in the budget of the Business Plan. The budget for Phase III of the Project includes [*]% overhead as mandated by the Sponsored Research Agreement. This [*]% overhead will cover use of the TTUHSC facilities during the funding period. (ATTACHMENT 4) SUBMITTED BY: JAN SIMONI, DVM, PHD Associate Research Professor of Surgery and Internal Medicine P.I. of Sponsored Research Agreement TTUHSC, School of Medicine Lubbock, TX 79430 SIGNATURE: /s/ Jan Simoni DATE: 1/03/06 - ---------- * Blank spaces contained confidential information that has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. 9 APPROVED BY: BARBARA C. PENCE, PH.D. Associate Vice President for Research and Associate Dean for Research and the Graduate School Office of Research and the Graduate School, TTUHSC Lubbock, TX 79430 SIGNATURE: /s/ Barbara Pence DATE: 1/09/06 MS. JUNE HOWARD Director, Office of Sponsored Programs TTUHSC, Lubbock, TX 79430 SIGNATURE: /s/ June Howard DATE: 1/09/06 LANCE ANDERSON, JD Director, Office of Technology Transfer and Intellectual Properties TTU & TTUHSC, Lubbock, TX 79414 SIGNATURE: /s/ Lance Anderson DATE: 1/09/06 1 ATTACHMENT 1. ANIMAL BLOOD DONOR FACILITY MAINTENANCE BUDGET: From: Johnson, Jay W To: Simoni, Jan Cc: Subject: budget Sent: 12/14/2005 2:00 PM Importance: Normal Dr. Simoni, Here is the proposed budget Thanks for working with us and have a great Christmas and a Happy Holiday. Jay W Johnson Assistant Professor Beef Cattle Texas Tech University 806 ###-###-#### 806 ###-###-#### Proposed Budget.doc Proposed Budget HemoBio Tech Project AMOUNT ------ 1. Salary and Wages Animal Technician $[*] @ [*] Time $[*] 2. Fringes $[*] 3. Feed & Care of cattle $[*] 4. Maintenance & Supplies $[*] Subtotal Total $[*] 5. F&A @ [*] $[*] ------ Total Direct & Indirect Costs $[*] Budget Summary The exact cost of the budget for the year 2006 will be determined through the course of the project. The budget will be adjusted semi-annually to cover costs of any additional activities needed to comply with any FDA or other government entity recommendations. As of December 2005, the Texas Tech University team is unaware of any future FDA outcome meetings; thus it is impossible to predict if the purchasing of any new animals will be needed. Future purchases, which will increase the number of animals available for use, will be based upon FDA requirements. Subsequently, if new animals are warranted, the budget will be increased to not only cover these purchases, but any compensation, related overhead, and any relevant expenses needed for satisfactory completion of the project. - ---------- * Blank spaces contained confidential information that has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. 2 ATTACHMENT 4. INITIAL DOWN PAYMENT FOR PHASE III: $286,999 PROJECT TITLE: The Texas Tech-HemoBioTech Joint Blood Substitute Project. Phase III: IND Process and HemoTech(TM) Manufacturing. PROJECT DIRECTOR (at HemoBioTech, Inc.): Dr. Arthur P. Bollon PROJECT PRINCIPAL INVESTIGATOR (at TTUHSC): Dr. Jan Simoni DETAILED BUDGET FOR PHASE II OF THE PROJECT FROM: January 1, 2006 THROUGH: December 31, 2006 SALARY:
- ---------- * Blank spaces contained confidential information that has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. 3
