An outlicense clause grants a party the right to license out specific intellectual property or technology to third parties. It typically outlines the conditions, rights, and limitations under which such sublicensing can occur, ensuring the original license holder maintains control over how their property is utilized.
Scenario 3: PTC exploits the Programme Intellectual Property on a For-Profit Basis by retaining development/commercialization rights to Product in some regions of the World or with respect to some uses of the Product (either alone or in a collaboration with a Distributor or marketing/sales agent under which PTC retains overall control of commercialization)), and outlicenses the Product on an exclusive basis in other regions of the World or with respect to other uses of the Product. a) In this scenario, any consideration from outlicensing (other than debt at arm’s length interest rates or bona fide research funding) shall be divided between the parties according to Base Shares as of effective date of the outlicense. b) In addition, following such outlicense, PTC shall pay milestones and royalties based on scenario 1 for those regions of the World or uses of the Product for which it retains rights, subject to the following adjustments: i) PTC will prepare a written proposal for adjustment to milestones and royalties based on its modeling of the relative values of market share outlicensed vs. market share retained by PTC. (1) The Trust shall consider PTC’s proposal in good faith, and prepare a written counterproposal if it wishes; (2) The parties shall negotiate in good faith for reasonable allocation of relative value of markets based on their proposals; (3) If the parties cannot agree within [**] days, then the matter shall be referred for final determination via arbitration pursuant to Clause 19.3(a). (4) Once the relative value of the markets outlicensed versus the markets retained by PTC is determined, PTC’s obligation to make continuing milestone and royalty payments pursuant to Scenario 1 shall be reduced according to relative value of markets outlicensed versus the markets retained. By way of example, if PTC outlicensed [**] of the market value of a Product, then a milestone payment of $[**] owed under scenario 1 would be reduced to a milestone payment of $[**] under this scenario 3, and a [**]% Net Sales royalty under scenario 1 would become a [**]% Net Sales royalty under this scenario 3.
Enrollment ongoing in the imsidolimab GEMINI-1 GPP Phase 3 registrational trial with top-line data anticipated Q4 2023 and the company plans to outlicense imsidolimab prior to potential FDA approval
Executed binding term sheet with Sorrento Therapeutics (Nasdaq:SRNE) to outlicense C1 protein production platform for the development and commercialization of vaccines, therapeutic antibodies, protein therapeutics, and diagnostics for coronaviruses, including DYAI-100, Dyadic’s lead COVID-19 vaccine candidate
On May 28, 2021, Cerecor outlicensed all of its rights in respect of its non-core asset, CERC-301, to Alto Neuroscience, Inc. (“Alto”). Cerecor will receive a mid-six digit upfront payment and can earn development, regulatory and sales-based milestone payments as well as modest royalties based on Alto’s activities under the outlicense.
In certain circumstances set forth in the License Agreement, in the event that First Wave seeks to outlicense, sell or otherwise grant to a third party rights relating to its proprietary formulations of niclosamide (or any products containing niclosamide) for use outside the ICI-AC and the COVID field, then First Wave must provide the Company written notice and engage in good faith negotiations with the Company for a period of time to try to reach agreement on the terms of an acquisition of First Wave by the Company.
Gilead acquired an outlicense and supply agreement to Everest Medicines II Limited, which had an estimated fair value of $175 million as of the acquisition date. This definite-lived intangible asset is being amortized over an estimated useful life of 15 years on a straight-line basis. Amortization expense was $12 million and $6 million for the year ended December 31, 2019 and the six months ended June 30, 2020, respectively, and is included in Cost of goods sold.
Mustang aims to acquire rights to these technologies by licensing or otherwise acquiring an ownership interest, to fund research and development, and to outlicense or bring the technologies to market.
A “Corporate Transaction” means any exclusive outlicense, collaboration, program-related option grant, joint venture, acquisition of PubCo, or similar business development-related transaction relating to the lead program of PBI-0451 or the backup program Gen 2 (collectively, a “Corporate Transaction”).
Sorrento Therapeutics License - On August 10, 2021, the Company signed a binding term sheet to enter into a definitive agreement with Sorrento Therapeutics, Inc. (“Sorrento”) to outlicense its lead COVID-19 vaccine candidate “DYAI-100” and C1 technology for protein-based coronaviruses vaccines and therapeutics. The definitive agreement, is expected to include the following key provisions:
2.4 Right of First Refusal. (a) If at any time during the Term, Premas desires to outlicense any additional Premas Technology with application in the Field (for clarity, which does not relate to a Candidate) then in such instance, Premas shall provide Licensee with notice of such intention and allow Licensee a period of fifteen (15) days to review the opportunity and determine whether to seek to negotiate a license. If Licensee determines to seek to negotiate a license then in such case the Parties shall exclusively negotiate in good faith for a period of thirty (30) days to reach agreement on license terms. If the Parties are unable to reach agreement then in such instance, Premas shall be free to negotiate a license for a Third Party without any further obligation to Licensee. (b) If at any time during the Term, Premas desires to outlicense the rights to any additional candidates developed independently by Premas using Premas’s D Crypt Technology with application that is outside the Field then in such instance, Premas shall provide Licensee with notice of such intention and allow Licensee a period of fifteen (15) days to review the opportunity and determine whether to seek to negotiate a license. If Licensee determines to seek to negotiate a license then in such case the Parties shall exclusively negotiate in good faith for a period of thirty (30) days to reach agreement on license terms. If the Parties are unable to reach agreement then in such instance, Premas shall be free to negotiate a license for a Third Party without any further obligation to Licensee. Notwithstanding the foregoing, the provisions of this Section 2.4.2 shall not apply with respect to any licensing transaction that is a Strategic Transaction (as defined herein). For purposes of this Agreement, a “Strategic Transaction” means a transactions with a Person that is, itself or through its subsidiaries, an operating company in a business synergistic with the business of Premas (and has been engaged in such synergistic business for at least 5 years) and the transaction provides to the Company substantial scientific or commercial benefits in addition to the investment of funds.
Our rights to ralinepag are subject to an outlicense in certain Asian territories. During the first quarter of 2023, the holder of this outlicense provided notice terminating licensee’s rights to ralinepag effective during August 2023.
VBI wishes to outlicense the development and commercialization of Licensed Product in the Licensed Territory to Brii Bio.
Important factors that may affect actual results and result in the Management Projections not being achieved include, but are not limited to, the timing of regulatory approvals and introduction of new products, market acceptance of new products, success of clinical testing, availability of third-party reimbursement, impact of competitive products and pricing, success of any collaboration partners to whom Imago may outlicense product candidates, the effect of regulatory actions, the effect of global economic conditions, fluctuations in foreign currency exchange rates, the cost and effect of changes in tax and other legislation, and other risk factors described in Imago’s annual report on Form 10-K filed on March 24, 2022, subsequent quarterly reports on Form 10-Q and current reports on Form 8-K.
An Outlicense is a contractual agreement where a company (often referred to as the licensor) grants permission to another party (the licensee) to use its intellectual property (IP), technology, or product rights. This typically occurs when the licensor seeks to leverage the licensee’s resources, market access, or expertise to commercialize the IP. This arrangement allows the licensor to generate revenue without directly expanding its own operations.
You should consider using an outlicensing strategy in the following scenarios:
When drafting an outlicense agreement, consider including the following elements:
Example: A pharmaceutical company outlicenses a new drug compound to a larger biotech firm that has greater resources to conduct clinical trials and obtain regulatory approval.
Outlicensing agreements are often embedded in or associated with several types of contracts, such as:
Try our AI contract analysis and extract important clauses and information from existing contracts.
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Dive deeper into the world of clauses and learn more about these other clauses that are used in real contracts.
The Outstanding Fees clause stipulates that any unpaid fees or dues incurred by one party must be settled within a specified timeframe. Failure to settle these outstanding fees may result in additional penalties, interest charges, or legal action to recover the owed amount.
The Ownership of Deliverables clause specifies who retains the rights to the outputs or products created under a contract. It typically determines whether the client or the contractor holds intellectual property rights, ensuring clarity on the use, modification, and distribution of the deliverables.
The "Ownership of Proprietary Information" clause establishes that any proprietary information or intellectual property created, disclosed, or accessed during the course of the agreement remains the exclusive property of the originating party. This clause also typically includes provisions outlining how such information should be handled, protected, and used by the receiving party to prevent unauthorized disclosure or misuse.
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