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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Ireland
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98-1032470
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Ordinary shares, nominal value $0.0001 per share
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JAZZ
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The Nasdaq Stock Market LLC
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Large accelerated filer
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Accelerated filer
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☐
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Non-accelerated filer
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Smaller reporting company
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Emerging growth company
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Page
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PART I
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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PART II
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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PART III
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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PART IV
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Item 15.
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Item 16.
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Item 1.
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Business
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Xyrem® (sodium oxybate) oral solution, the only product approved by the U.S. Food and Drug Administration, or FDA, and marketed in the U.S. for the treatment of both cataplexy and excessive daytime sleepiness, or EDS, in both adult and pediatric patients with narcolepsy;
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Sunosi® (solriamfetol), a product approved by the FDA and marketed in the U.S. to improve wakefulness in adult patients with EDS associated with narcolepsy or obstructive sleep apnea, or OSA, and also approved in Europe in January 2020 by the European Commission, or EC;
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Defitelio® (defibrotide sodium), a product approved in the U.S. for the treatment of adult and pediatric patients with hepatic veno-occlusive disease, or VOD, also known as sinusoidal obstruction syndrome, or SOS, with renal or pulmonary dysfunction following hematopoietic stem cell transplantation, or HSCT, and in Europe (where it is marketed as Defitelio® (defibrotide)) for the treatment of severe VOD in adults and children undergoing HSCT therapy;
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Erwinaze® (asparaginase Erwinia chrysanthemi), a treatment approved in the U.S. and in certain markets in Europe (where it is marketed as Erwinase®) for patients with acute lymphoblastic leukemia, or ALL, who have developed hypersensitivity to E. coli-derived asparaginase; and
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Vyxeos® (daunorubicin and cytarabine) liposome for injection, a product approved in the U.S. and in Europe (where it is marketed as Vyxeos® liposomal 44 mg/100 mg powder for concentrate for solution for infusion) for the treatment of adults with newly-diagnosed therapy-related acute myeloid leukemia, or t-AML, or AML with myelodysplasia-related changes, or AML-MRC.
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Strong financial execution through growth in sales of our current lead marketed products;
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Building a diversified product portfolio and development pipeline through a combination of our internal research and development efforts and obtaining rights to clinically meaningful and differentiated on- or near-market products and early- to late-stage product candidates through acquisitions, collaborations, licensing arrangements, partnerships and venture investments; and
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Maximizing the value of our products and product candidates by continuing to implement our comprehensive global development plans, including through generating additional clinical data and seeking regulatory approval for new indications and new geographies.
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ImmunoGen, Inc., or ImmunoGen, for opt-in rights to license a hematology-related antibody-drug conjugate product candidate granted orphan drug designation by the FDA;
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Codiak BioSciences, Inc., or Codiak, for an exclusive, worldwide, royalty-bearing license to develop, manufacture and commercialize potential therapeutic candidates directed at five targets to be developed using Codiak's engEx™ precision engineering platform for exosome therapeutics;
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Pfenex, Inc., or Pfenex, for rights to an early-stage long-acting Erwinia asparaginase and an option to negotiate a license for a recombinant pegaspargase product candidate;
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XL-protein GmbH, or XLp, for rights to use XLp’s PASylation® technology to extend the plasma half-life of selected asparaginase product candidates; and
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Redx Pharma, or Redx, for pre-clinical collaboration activities related to the pan-RAF inhibitor program that we purchased from Redx for the potential treatment of RAF and RAS mutant tumors.
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Product Candidates
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Description
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Submitted for Regulatory Approval
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JZP-258 (oxybate; 92% sodium reduction)
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Cataplexy and EDS in narcolepsy
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Phase 3
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JZP-258 (oxybate; 92% sodium reduction)
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Idiopathic hypersomnia
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Sunosi
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EDS in major depressive disorder (planned study)
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Phase 2b
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JZP-385
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Essential tremor (planned study)
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Preclinical
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JZP-324
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Oxybate once-nightly formulation
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Product Candidates
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Description
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Submitted for Regulatory Approval
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Lurbinectedin
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Relapsed SCLC (exclusive U.S. license)
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Phase 3
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Defitelio
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Prevention of VOD in high- and very high-risk patients following HSCT
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Vyxeos
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AML or high-risk Myelodysplastic Syndrome, or MDS (AML19 and AML 18) (cooperative group studies)
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Vyxeos
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Newly diagnosed adults with standard- and high-risk AML (AML Study Group cooperative group study)
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Vyxeos
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Newly diagnosed pediatric patients with AML (planned Children’s Oncology Group cooperative group study)
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Lurbinectedin
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Relapsed SCLC (ATLANTIS) (exclusive U.S. license)
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Product Candidates
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Description
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Phase 2/3
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JZP-458 (recombinant Erwinia asparaginase)
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ALL/LBL
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Phase 2
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Defitelio
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Prevention of aGvHD following allogeneic HSCT
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Defitelio
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Prevention of CAR T-cell therapy-associated neurotoxicity
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Vyxeos + venetoclax
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De novo or relapsed/refractory, or R/R, AML (MD Anderson collaboration study)
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Vyxeos
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High-risk MDS (European Myelodysplastic Syndromes Cooperative Group cooperative group study)
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Vyxeos
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Newly diagnosed older adults with high-risk AML (planned cooperative group study)
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Vyxeos + venetoclax
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High-risk AML (planned cooperative group study)
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Phase 1
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Vyxeos + gemtuzumab
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R/R AML or hypomethylating agent failure MDS (MD Anderson collaboration study)
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Vyxeos + venetoclax
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Low intensity Vyxeos therapy for first-line, unfit AML (Phase 1b study)
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Vyxeos + other approved therapies
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First-line, fit AML (Phase 1b study)
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Vyxeos
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Low intensity dosing for higher risk MDS (MD Anderson collaboration study)
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IMGN632
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R/R CD123+ hematological malignancies (Jazz opt-in opportunity with ImmunoGen)
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IMGN632 +/- venetoclax/azacitidine
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CD123+ AML (Jazz opt-in opportunity with ImmunoGen; Phase 1b/2 study)
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Preclinical
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CombiPlex
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Solid tumors candidate
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CombiPlex
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Hematology/oncology exploratory activities
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JZP-341 (long-acting Erwinia asparaginase)
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ALL and other hematological malignancies (collaboration with Pfenex)
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Recombinant pegaspargase
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Hematological malignancies (Jazz opt-in opportunity with Pfenex)
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Defitelio
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Exploratory activities
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Exosome NRAS candidate
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Hematological malignancies (collaboration with Codiak)
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Exosome STAT3 candidate
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Hematological malignancies (collaboration with Codiak)
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Exosome-based candidates
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Solid tumors/hematological malignancies (collaboration with Codiak)
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Pan-RAF inhibitor program
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RAF and RAS mutant tumors (acquired from Redx, which is continuing development)
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•
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Xyrem. While Xyrem is currently the only product approved by the FDA and marketed in the U.S. for the treatment of both cataplexy and EDS in both adult and pediatric patients with narcolepsy, we and others have launched products to treat EDS in narcolepsy and may in the future launch products to treat cataplexy in narcolepsy that are competitive with or disrupt the market for Xyrem. In the future, we expect Xyrem to face competition from authorized generic and generic versions of sodium oxybate. For a description of generic versions of sodium oxybate and/or new products for treatment of cataplexy and/or EDS that could compete with, or otherwise disrupt the market for, Xyrem, as well as a description of our settlement agreements with abbreviated new drug application, or ANDA, filers, see the risk factor under the heading “The introduction of new products in the U.S. market that compete with, or otherwise disrupt the market for, our oxybate products and product candidates would adversely affect sales of our oxybate products and product candidates” in Part I, Item 1A of this Annual Report on Form 10-K.
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Sunosi. Sunosi faces competition from existing branded and generic products that treat EDS or improve wakefulness in adult patients with narcolepsy or OSA in a competitive retail pharmacy market. To successfully commercialize Sunosi, we need to differentiate Sunosi from other branded and generic products that treat EDS in patients with narcolepsy, including stimulants, wake-promoting agents, such as Provigil and Nuvigil, and generic versions of stimulants and wake-promoting agents. We are also aware that stimulants are prescribed off-label for patients to treat excessive sleepiness in OSA. Like Xyrem, Sunosi may face competition from new branded entrants such as pitolisant, a drug that was approved by the FDA in August 2019 for the treatment of EDS in adult patients with narcolepsy and became commercially available in the U.S. in the fourth quarter of 2019, and that has also been approved and marketed in Europe to treat adult patients with narcolepsy with or without cataplexy. Sunosi may also face competition from other products in development as potential treatments for EDS in patients with narcolepsy or OSA.
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JZP-258. We expect that, if approved, JZP-258 will face competition similar to that described above for Xyrem, including from new branded entrants in narcolepsy and/or from generic or authorized generic sodium oxybate products.
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Defitelio. While there is currently no direct competition to Defitelio to treat severe VOD, changes in the types of conditioning regimens used as part of HSCT may affect the incidence of VOD diagnosis and demand for Defitelio.
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Erwinaze. While there is currently no direct competition to Erwinaze to treat ALL patients with hypersensitivity to E. coli-derived asparaginase, we and other companies have developed or are developing new treatments for ALL. Some new asparaginase treatments could reduce the rate of hypersensitivity in patients with ALL, and new treatment protocols are being developed and approved for ALL that may not include asparaginase-containing regimens, including some for the treatment of relapsed or refractory ALL patients. We have experienced frequent intermittent shortages of the product that have impacted prescribing habits for Erwinaze, including prescribers’ use of alternate methods to address hypersensitivity reactions. As a biologic product, Erwinaze also faces potential competition from biosimilar products.
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Vyxeos. With respect to Vyxeos, there are a number of alternative established therapies in AML. A key consideration in the treatment of AML patients is the patient’s suitability for chemotherapy. The AML patient population studied in the Vyxeos Phase 3 clinical trial supporting our NDA included 60-75 year old fit patients, or those deemed able to tolerate intensive induction chemotherapy. Prior to Vyxeos, the most widely recognized option for the treatment of newly-diagnosed t-AML and AML-MRC in fit patients was cytarabine in combination with daunorubicin, known as 7+3, which is still used today in this population, along with other intensive chemotherapy regimens, particularly in patients under the age of 60. Also, since Vyxeos was approved, several other products have been approved by the FDA or are in development as treatment options for newly diagnosed AML patients eligible for intensive chemotherapy, such as targeted agents (e.g. midostaurin, enasidenib and ivosidenib), immunotherapies (e.g., gemtuzumab ozogamicin and CAR-T‑cell therapy), and agents disrupting leukemia cell survival (e.g., glasdegib). We are also aware of the increasing use of venetoclax combined with either a hypomethylating agent or low-dose cytarabine, a treatment approved by the FDA in newly diagnosed AML patients who are age 75 years or older, or who have comorbidities that preclude use of intensive induction chemotherapy.
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Lurbinectedin. We expect that, if approved, lurbinectedin will face competition from topotecan, which is currently the only approved treatment in second line SCLC in the U.S., as well as other regimens for relapsed SCLC currently recommended in compendia guidelines. There are also a number of products and immunotherapies in development for the treatment of second line SCLC in various phases of development.
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Xyrem. We currently have nine issued, unexpired patents in the U.S. relating to Xyrem. All but two of these patents are listed in the FDA’s publication “Approved Drug Products with Therapeutic Equivalence Evaluations,” or the Orange Book. Our patents relate to Xyrem’s stable and microbially resistant formulation, its method of use, including its restricted distribution system, its method of administration, and a drug-drug interaction, or DDI, between Xyrem and divalproex sodium. In October 2018, as a result of the FDA’s grant of pediatric exclusivity, an additional six months was added to the original expiration dates of all of our Orange Book-listed patents that existed at that time. As a result, our Orange Book-listed patents have periods of exclusivity between June 2020 and September 2033.
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Sunosi. We acquired worldwide development, manufacturing and commercial rights to solriamfetol from Aerial BioPharma LLC, or Aerial, in 2014, including Aerial’s patent rights relating to solriamfetol, other than in certain jurisdictions in Asia where SK Biopharmaceuticals Co., Ltd. retains rights. We have a portfolio of U.S. and non-U.S. patents and patent applications for solriamfetol relating to various compositions, formulations and methods of use. Four of our U.S. patents are method of use patents covering treatment of sleep-related conditions expiring between June 2026 and August 2027. Two other U.S. patents cover, respectively, the formulation of solriamfetol and the method of treating select conditions with formulations of solriamfetol (both expiring in September 2037). A request for a patent term extension for one of the above method of use patents has been filed. Sunosi has also been granted orphan drug exclusivity for narcolepsy in the U.S.
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Defitelio. The unique process of deriving defibrotide from porcine DNA is extensive and uses both chemical and biological processes that rely on complex characterization methods. We have U.S. and non-U.S. patents and patent applications relating to various compositions, methods of use and methods of characterization, expiring at various times between April 2021 and November 2035. None of these patents are listed in the Orange Book. Defibrotide has been granted orphan drug exclusivity by the FDA to treat and prevent VOD until March 2023. Defibrotide has also been granted orphan drug designation by the EC and the Korean Ministry of Food and Drug Safety to treat and prevent VOD, by the Commonwealth of Australia-Department of Health for the treatment of VOD and by the EC for the prevention of aGvHD. We acquired the rights to defibrotide for the treatment and prevention of VOD in North America, Central America and South America from Sigma-Tau Pharmaceuticals, Inc. in 2014.
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Erwinaze. Erwinaze has no patent protection. It had been granted orphan drug exclusivity by the FDA for the treatment of ALL in the U.S. until November 2018, and as a biological product approved under a BLA, we believe
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Vyxeos. We have a portfolio of U.S. and non-U.S. patents and patent applications for Vyxeos and the CombiPlex technology platform relating to various compositions and methods of making and use. These include six U.S. patents covering Vyxeos compositions and methods of use expiring between April 2025 and September 2034 and two U.S. patents covering CombiPlex (which also cover Vyxeos) expiring in January 2027. These patents are listed in the Orange Book. Vyxeos has been granted orphan drug exclusivity by the FDA until August 2024, seven years from its FDA approval, for the treatment of adults with newly-diagnosed t-AML or AML-MRC. In addition, Vyxeos has been granted orphan drug designation by the EC until August 2028, ten years from its EC approval for the treatment of adults with newly-diagnosed t-AML or AML-MRC.
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JZP-258. We have U.S. patents and patent applications that relate to our product candidate JZP-258. These patents expire December 2033.
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JZP-385. Through the acquisition of Cavion in 2019, we obtained a portfolio of U.S. and non-U.S. patents and patent applications, including rights relating to compositions and methods of using JZP-385. The portfolio includes a U.S. composition of matter patent relating to JZP-385, which expires in 2027.
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JZP-458. We obtained worldwide rights from Pfenex, including Pfenex’s patent rights relating to JZP-458, in 2016 to develop and commercialize multiple early-stage hematology product candidates, including a license to a U.S. process patent relating to JZP-458, which expires in 2026.
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Lurbinectedin. In December of 2019, we entered into an exclusive license agreement with PharmaMar pursuant to which we obtained exclusive U.S. development and commercialization rights to lurbinectedin, including a license to a U.S. composition of matter patent, which expires in 2024.
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conducting preclinical laboratory and animal testing and submitting the results to the FDA in an investigational new drug, or IND, application requesting approval to test the product candidate in human clinical trials;
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conducting adequate and well-controlled human clinical trials to establish the safety and efficacy of the product candidate in the desired indication;
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submitting an NDA, supplemental NDA, or sNDA, or BLA, as appropriate, to the FDA seeking approval for a specific indication; and
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completing inspections by the FDA of the facilities where the product candidate is manufactured, analyzed and stored to demonstrate compliance with current Good Manufacturing Practices, or cGMP, and any requested FDA audits of the clinical trial sites that generated the data supporting the application.
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Item 1A.
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Risk Factors
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the clinical indications for which a product is approved and any restrictions placed upon the product in connection with its approval, such as a REMS, patient registry requirements or labeling restrictions;
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the prevalence of the disease or condition for which the product is approved and its diagnosis;
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the severity of side effects and other risks in relation to the benefits of our products;
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acceptance by physicians and patients of each product as a safe and effective treatment;
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availability of sufficient product inventory to meet demand, particularly with respect to Erwinaze;
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physicians’ decisions relating to treatment practices based on availability of product, particularly with respect to Erwinaze;
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perceived advantages over alternative treatments;
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relative convenience and ease of administration;
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with respect to Xyrem, physician and patient assessment of the burdens associated with obtaining or maintaining the certifications required under the Xyrem REMS;
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the cost of treatment in relation to alternative treatments, including generic products; and
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the availability of financial or other assistance for patients who are uninsured or underinsured.
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the need to incur substantial debt or engage in dilutive issuances of equity securities to pay for acquisitions;
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the potential disruption of our historical core business;
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the strain on, and need to continue to expand, our existing operational, technical, financial and administrative infrastructure;
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the difficulties in integrating acquired products and product candidates into our portfolio;
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the difficulties in assimilating employees and corporate cultures;
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the failure to retain key managers and other personnel;
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the need to write down assets or recognize impairment charges;
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the diversion of our management’s attention to integration of operations and corporate and administrative infrastructures; and
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any unanticipated liabilities for activities of or related to the acquired business or its operations, products or product candidates.
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difficulty identifying, recruiting or enrolling eligible patients, often based on the number of clinical trials, particularly in hematology and oncology, with enrollment criteria targeting the same patient population;
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difficulty identifying a clinical development pathway, including viable indications and appropriate clinical trial protocol design, particularly where there is no applicable regulatory precedent;
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delays or failures in obtaining regulatory authorization to commence a trial because of safety concerns of regulators relating to our product candidates or similar product candidates of our competitors or failure to follow regulatory guidelines;
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delays or failures in obtaining clinical materials and manufacturing sufficient quantities of the product candidate for use in trials;
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delays or failures in reaching agreement on acceptable terms with prospective study sites;
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delays or failures in obtaining approval of our clinical trial protocol from an institutional review board, known as an ethics committee in Europe, to conduct a clinical trial at a prospective study site;
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failure of our clinical trials and clinical investigators, including contract research organizations or other third parties assisting us with clinical trials, to satisfactorily perform their contractual duties, meet expected deadlines and comply with the FDA and other regulatory agencies’ requirements, including good clinical practices;
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unforeseen safety issues;
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inability to monitor patients adequately during or after treatment;
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difficulty monitoring multiple study sites; or
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insufficient funds to complete the trials.
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our patent applications, or those of our licensors or partners, may not result in issued patents;
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others may independently develop similar or therapeutically equivalent products without infringing our patents, or those of our licensors, such as products that are not covered by the claims of our patents, or for which we do not have adequate exclusive rights under our license agreements;
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our issued patents, or those of our licensors or partners, may be held invalid or unenforceable as a result of legal challenges by third parties or may be vulnerable to legal challenges as a result of changes in applicable law;
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we or our licensors or partners might not have been the first to invent or file, as appropriate, subject matters covered by our issued patents or pending patent applications or those of our licensors or partners;
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competitors may manufacture products in countries where we have not applied for patent protection or that have a different scope of patent protection or that do not respect our patents; or
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others may be issued patents that prevent the sale of our products or require licensing and the payment of significant fees or royalties.
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the diverse regulatory, financial and legal requirements in the countries where we are located or do business, and any changes to those requirements;
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challenges inherent in efficiently managing employees in diverse geographies, including the need to adapt systems, policies, benefits and compliance programs to differing labor and employment law and other regulations, as well as maintaining positive interactions with our unionized employees;
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costs of, and liabilities for, our international operations, products or product candidates; and
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public health risks, such as the recent spread in China of coronavirus in early 2020 and potential related effects on supply chain, travel and employee health and availability.
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limit our ability to borrow additional funds for working capital, capital expenditures, acquisitions or other general business purposes;
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limit our ability to use our cash flow or obtain additional financing for working capital, capital expenditures, acquisitions, investments or other general business purposes;
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require us to use a substantial portion of our cash flow from operations to make debt service payments;
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limit our flexibility to plan for, or react to, changes in our business and industry, or our ability to take specified actions to take advantage of certain business opportunities that may be presented to us;
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result in dilution to our existing shareholders in the event exchanges of our exchangeable senior notes are settled in our ordinary shares;
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place us at a competitive disadvantage compared to our less leveraged competitors; and
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increase our vulnerability to the impact of adverse economic and industry conditions.
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incur or assume liens or additional debt or provide guarantees in respect of obligations of other persons;
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pay dividends or distributions or redeem or repurchase capital stock;
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prepay, redeem or repurchase certain debt;
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make loans, investments, acquisitions (including acquisitions of exclusive licenses) and capital expenditures;
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enter into agreements that restrict distributions from our subsidiaries;
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sell assets and capital stock of our subsidiaries; and
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consolidate or merge with or into, or sell substantially all of our assets to, another person.
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Item 1B.
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Unresolved Staff Comments
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Item 2.
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Properties
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Item 3.
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Legal Proceedings
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Item 4.
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Mine Safety Disclosures.
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Item 5.
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Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
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(1)
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This section is not “soliciting material,” is not deemed “filed” with the SEC and is not to be incorporated by reference into any of our filings under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, or Exchange Act, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing.
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(2)
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Information used in the graph was obtained from Research Data Group, Inc.
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Total Number of Shares Purchased (1)
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Average Price Paid per Share (2)
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Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (3)
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Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs (4)
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||||||
October 1 - October 31, 2019
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57,300
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$
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122.96
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57,300
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$
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681,006,700
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November 1 - November 30, 2019
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555,852
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$
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136.45
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555,852
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$
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605,174,166
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December 1 - December 31, 2019
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183,345
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$
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149.49
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183,345
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$
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577,732,249
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Total
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796,497
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$
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138.53
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796,497
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(1)
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This column does not include ordinary shares that we withheld in order to satisfy minimum tax withholding requirements in connection with the vesting of restricted stock units.
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(2)
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Average price paid per share includes brokerage commissions.
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(3)
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The ordinary shares reported in this column above were purchased pursuant to our publicly announced share repurchase program. In November 2016, we announced that our board of directors authorized the use of up to $300 million to repurchase our ordinary shares. In November and December 2018, our board of directors increased the existing share repurchase program authorization by $320.0 million and $400.0 million, respectively. In October 2019, our board of
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(4)
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The dollar amount shown represents, as of the end of each fiscal month, the approximate dollar value of ordinary shares that may yet be purchased under our publicly announced share repurchase program, exclusive of any brokerage commissions. The timing and amount of repurchases will depend on a variety of factors, including the price of our ordinary shares, alternative investment opportunities, restrictions under our credit agreement, corporate and regulatory requirements and market conditions, and may be modified, suspended or otherwise discontinued at any time without prior notice.
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Item 6.
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Selected Financial Data
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As of December 31,
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2019
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2018
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2017
|
|
2016(1)
|
|
2015
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Consolidated Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash, cash equivalents and investments
|
$
|
1,077,344
|
|
|
$
|
824,622
|
|
|
$
|
601,035
|
|
|
$
|
425,963
|
|
|
$
|
988,785
|
|
Working capital
|
1,265,778
|
|
|
888,518
|
|
|
674,330
|
|
|
490,663
|
|
|
1,031,025
|
|
|||||
Total assets
|
5,538,897
|
|
|
5,203,491
|
|
|
5,123,672
|
|
|
4,800,227
|
|
|
3,332,612
|
|
|||||
Long-term debt, current and non-current (1)
|
1,607,257
|
|
|
1,596,412
|
|
|
1,581,038
|
|
|
2,029,625
|
|
|
1,188,444
|
|
|||||
Retained earnings
|
1,067,815
|
|
|
841,050
|
|
|
917,956
|
|
|
528,907
|
|
|
302,686
|
|
|||||
Total Jazz Pharmaceuticals plc shareholders’ equity
|
3,110,981
|
|
|
2,757,422
|
|
|
2,713,097
|
|
|
1,877,339
|
|
|
1,598,646
|
|
(1)
|
On July 12, 2016, we completed the acquisition of Celator Pharmaceuticals, Inc., or Celator, which acquisition we refer to in this report as the Celator Acquisition, for an aggregate cash consideration of $1.5 billion and the results of operations of the acquired Celator business, along with the estimated fair values of the assets acquired and liabilities assumed, have been included in our consolidated financial statements since the closing of the Celator Acquisition.
|
Item 7.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
•
|
Xyrem® (sodium oxybate) oral solution, the only product approved by the U.S. Food and Drug Administration, or FDA, and marketed in the U.S. for the treatment of both cataplexy and excessive daytime sleepiness, or EDS, in both adult and pediatric patients with narcolepsy;
|
•
|
Sunosi® (solriamfetol), a product approved by the FDA and marketed in the U.S. to improve wakefulness in adult patients with EDS associated with narcolepsy or obstructive sleep apnea, or OSA, and also recently approved in Europe in January 2020 by the European Commission, or EC;
|
•
|
Defitelio® (defibrotide sodium), a product approved in the U.S. for the treatment of adult and pediatric patients with hepatic veno-occlusive disease, or VOD, also known as sinusoidal obstruction syndrome, with renal or pulmonary dysfunction following hematopoietic stem cell transplantation, or HSCT, and in Europe (where it is marketed as Defitelio® (defibrotide)) for the treatment of severe VOD in adults and children undergoing HSCT therapy;
|
•
|
Erwinaze® (asparaginase Erwinia chrysanthemi), a treatment approved in the U.S. and in certain markets in Europe (where it is marketed as Erwinase®) for patients with acute lymphoblastic leukemia, or ALL, who have developed hypersensitivity to E. coli-derived asparaginase; and
|
•
|
Vyxeos® (daunorubicin and cytarabine) liposome for injection, a product approved in the U.S. and in Europe (where it is marketed as Vyxeos® liposomal 44 mg/100 mg powder for concentrate for solution for infusion) for the treatment of adults with newly-diagnosed therapy-related acute myeloid leukemia, or t-AML, or AML with myelodysplasia-related changes.
|
•
|
Strong financial execution through growth in sales of our current lead marketed products;
|
•
|
Building a diversified product portfolio and development pipeline through a combination of our internal research and development efforts and obtaining rights to clinically meaningful and differentiated on- or near-market products and early- to late-stage product candidates through acquisitions, collaborations, licensing arrangements, partnerships and venture investments; and
|
•
|
Maximizing the value of our products and product candidates by continuing to implement our comprehensive global development plans, including through generating additional clinical data and seeking regulatory approval for new indications and new geographies.
|
•
|
In March 2019, we launched Xyrem for the treatment of cataplexy and EDS in pediatric patients with narcolepsy, after completing the implementation of the related approved risk evaluation and mitigation strategy, or REMS, modification. In May 2019, the FDA confirmed that as the first sponsor to obtain marketing approval for use of Xyrem to treat cataplexy and EDS in pediatric narcolepsy patients aged seven years and older, we are entitled to seven years of orphan drug exclusivity for the pediatric indication.
|
•
|
In March 2019, the FDA approved our NDA for Sunosi as a treatment to improve wakefulness in adult patients with EDS associated with narcolepsy or OSA, and recommended that solriamfetol be scheduled by the U.S. Drug Enforcement Administration, or DEA. In June 2019, the DEA designated solriamfetol as a Schedule IV controlled substance, and, in July 2019, we launched Sunosi in the U.S.
|
•
|
In June 2019, our partner, Nippon Shinyaku Co., Ltd, announced that Japan's Ministry of Health, Labour and Welfare approved the marketing authorization of Defitelio® injection 200mg (defibrotide sodium) for the treatment of sinusoidal obstruction syndrome/hepatic VOD.
|
•
|
In November 2019, the European Medicines Agency recommended the marketing authorization application for Sunosi in Europe, and in January 2020, the EC approved Sunosi to improve wakefulness in adult patients with EDS associated with narcolepsy or OSA.
|
•
|
In March 2019, we announced positive top-line results from our Phase 3 study evaluating the efficacy and safety of JZP-258 for the treatment of cataplexy and EDS in adult patients with narcolepsy and presented additional results from this study publicly at an international medical conference in September 2019. We submitted an NDA for this product in January 2020 and redeemed our priority review voucher, or PRV, in connection with this submission.
|
•
|
In December 2019, we entered into an exclusive license agreement with Pharma Mar, S.A., or PharmaMar, pursuant to which we obtained exclusive U.S. development and commercialization rights to lurbinectedin, a product candidate under clinical investigation for the treatment of patients with relapsed SCLC. Lurbinectedin was granted orphan drug designation for SCLC by the FDA in August 2018. In December 2019, PharmaMar submitted an NDA to the FDA for accelerated approval of lurbinectedin for relapsed SCLC based on data from a Phase 2 trial, and in February 2020, the FDA accepted the NDA for filing with priority review with a Prescription Drug User Fee Act, or PDUFA, date of August 16, 2020.
|
•
|
In July 2019, we announced that we are pursuing development activities for Sunosi for the potential treatment of EDS in patients with major depressive disorder. We expect to initiate a Phase 3 study in mid-2020.
|
•
|
In October 2019, the FDA granted Fast Track designation to JZP-458, a recombinant Erwinia asparaginase product candidate, for the potential treatment of ALL and LBL and in December 2019, we announced enrollment of the first patient in this study.
|
•
|
In October 2019, we announced enrollment of the first patient in an exploratory Phase 2 clinical trial evaluating the ability of defibrotide to prevent neurotoxicity in patients with relapsed or refractory diffuse large B-cell lymphoma receiving chimeric antigen receptor T-cell therapy.
|
•
|
In October 2019, we completed enrollment in a Phase 2 study for defibrotide in the prevention of acute graft-vs-host disease.
|
•
|
In December 2019, we activated sites for a Phase 1b master trial of Vyxeos in combination with various targeted agents in first-line, fit AML.
|
•
|
In January 2019, we entered into a strategic collaboration agreement with Codiak BioSciences, Inc. focused on the research, development and commercialization of exosome therapeutics to treat cancer.
|
•
|
In February 2019, we received a contract termination notice from Porton Biopharma Limited, or PBL, the sole manufacturer of Erwinaze. As a result of our receipt of the contract termination notice, our license and supply agreement with PBL, which includes an exclusive right to market, sell or distribute Erwinaze, an exclusive license to Erwinaze trademarks, and a non-exclusive license to PBL’s manufacturing know-how, will expire on December 31, 2020. Unless we and PBL enter into a new agreement, we will lose our licensed rights to exclusively market Erwinaze effective December 31, 2020, other than our right to sell certain Erwinaze inventory for a post-termination sales period of 12 months and certain other post-termination rights, including but not limited to intellectual property and data ownership.
|
•
|
In April 2019, we finalized a settlement agreement with the U.S. Department of Justice, or DOJ, and the Office of Inspector General of the Department of Health and Human Services, or OIG, and we entered into a corporate integrity agreement requiring us to maintain our ongoing corporate compliance program and obligating us to implement or continue, as applicable, a set of defined corporate integrity activities for a period of five years from the effective date of the corporate integrity agreement.
|
•
|
In June 2019, we received notice from ImmunoGen, Inc., or ImmunoGen, that, as a result of portfolio prioritization and restructuring initiatives, ImmunoGen will be discontinuing development of its IMGN779 antibody-drug conjugate, or ADC, product candidate, for which we possess opt-in rights, as well as the programs from which a third opt-in candidate was to be selected. IMGN632, a CD123-targeted ADC product candidate for which we possess opt-in rights, remains under development by ImmunoGen.
|
•
|
In July 2019, we acquired from Redx Pharma plc, or Redx, a pan-RAF inhibitor program for the potential treatment of RAF and RAS mutant tumors. Under the terms of our agreement with Redx, we paid Redx $3.5 million at closing
|
•
|
In August 2019, we announced the acquisition of Cavion, Inc., a clinical-stage biotechnology company, or Cavion, for an upfront payment of $52.5 million with the potential for additional payments of up to $260.0 million upon the achievement of certain clinical, regulatory and commercial milestones, for a total potential consideration of $312.5 million. As a result of the acquisition, we added CX-8998, now named JZP-385, a modulator of T-type calcium channels, for the potential treatment of essential tremor, to our clinical pipeline.
|
•
|
Beginning in the third quarter of 2019, we have been entering into agreements with commercial payor organizations, including pharmacy benefit managers, or PBMs, to ensure patient access for our products, Sunosi and Xyrem, and to support the long-term success of our sleep and neuroscience therapeutic area. These agreements include terms related to the payment of rebates and/or administrative fees on these products. We expect to enter into additional agreements in 2020 to continue to ensure patient access to and coverage for our products.
|
•
|
In October 2019, our board of directors authorized the additional repurchase of our ordinary shares having an aggregate purchase price of up to $500.0 million, exclusive of any brokerage commissions, under our share repurchase program. During 2019, we repurchased an aggregate of $301.5 million of our ordinary shares under our share repurchase program at an average price of $133.97 per share.
|
|
2019
|
|
Change
|
|
2018
|
|
Change
|
|
2017
|
||||||||
Product sales, net
|
$
|
2,135,601
|
|
|
14
|
%
|
|
$
|
1,869,473
|
|
|
17
|
%
|
|
$
|
1,601,399
|
|
Royalties and contract revenues
|
26,160
|
|
|
22
|
%
|
|
21,449
|
|
|
24
|
%
|
|
17,294
|
|
|||
Cost of product sales (excluding amortization of acquired developed technologies)
|
127,930
|
|
|
5
|
%
|
|
121,544
|
|
|
10
|
%
|
|
110,188
|
|
|||
Selling, general and administrative
|
736,942
|
|
|
8
|
%
|
|
683,530
|
|
|
26
|
%
|
|
544,156
|
|
|||
Research and development
|
299,726
|
|
|
32
|
%
|
|
226,616
|
|
|
14
|
%
|
|
198,442
|
|
|||
Intangible asset amortization
|
354,814
|
|
|
76
|
%
|
|
201,498
|
|
|
33
|
%
|
|
152,065
|
|
|||
Impairment charges
|
—
|
|
|
N/A(1)
|
|
|
42,896
|
|
|
N/A(1)
|
|
|
—
|
|
|||
Acquired in-process research and development
|
109,975
|
|
|
N/A(1)
|
|
|
—
|
|
|
N/A(1)
|
|
|
85,000
|
|
|||
Interest expense, net
|
72,261
|
|
|
(6
|
)%
|
|
77,075
|
|
|
(1
|
)%
|
|
77,756
|
|
|||
Foreign exchange loss
|
5,811
|
|
|
(15
|
)%
|
|
6,875
|
|
|
(31
|
)%
|
|
9,969
|
|
|||
Loss on extinguishment and modification of debt
|
—
|
|
|
N/A(1)
|
|
|
1,425
|
|
|
N/A(1)
|
|
|
—
|
|
|||
Income tax provision (benefit)
|
(73,154
|
)
|
|
N/A(1)
|
|
|
80,162
|
|
|
N/A(1)
|
|
|
(47,740
|
)
|
|||
Equity in loss of investees
|
4,089
|
|
|
86
|
%
|
|
2,203
|
|
|
118
|
%
|
|
1,009
|
|
(1)
|
Comparison to prior period is not meaningful.
|
|
2019
|
|
Change
|
|
2018
|
|
Change
|
|
2017
|
||||||||
Xyrem
|
$
|
1,642,525
|
|
|
17
|
%
|
|
$
|
1,404,866
|
|
|
18
|
%
|
|
$
|
1,186,699
|
|
Erwinaze/Erwinase
|
177,465
|
|
|
2
|
%
|
|
174,739
|
|
|
(11
|
)%
|
|
197,340
|
|
|||
Defitelio/defibrotide
|
172,938
|
|
|
16
|
%
|
|
149,448
|
|
|
12
|
%
|
|
133,650
|
|
|||
Vyxeos
|
121,407
|
|
|
20
|
%
|
|
100,835
|
|
|
N/A(1)
|
|
|
33,790
|
|
|||
Sunosi
|
3,714
|
|
|
N/A(1)
|
|
|
—
|
|
|
N/A(1)
|
|
|
—
|
|
|||
Other
|
17,552
|
|
|
(56
|
)%
|
|
39,585
|
|
|
(21
|
)%
|
|
49,920
|
|
|||
Product sales, net
|
2,135,601
|
|
|
14
|
%
|
|
1,869,473
|
|
|
17
|
%
|
|
1,601,399
|
|
|||
Royalties and contract revenues
|
26,160
|
|
|
22
|
%
|
|
21,449
|
|
|
24
|
%
|
|
17,294
|
|
|||
Total revenues
|
$
|
2,161,761
|
|
|
14
|
%
|
|
$
|
1,890,922
|
|
|
17
|
%
|
|
$
|
1,618,693
|
|
(1)
|
Comparison to prior period is not meaningful.
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Clinical studies and outside services
|
$
|
133,042
|
|
|
$
|
117,903
|
|
|
$
|
93,317
|
|
Personnel expenses
|
100,090
|
|
|
71,158
|
|
|
63,941
|
|
|||
Milestone expense
|
26,000
|
|
|
11,000
|
|
|
19,500
|
|
|||
Other
|
40,594
|
|
|
26,555
|
|
|
21,684
|
|
|||
Total
|
$
|
299,726
|
|
|
$
|
226,616
|
|
|
$
|
198,442
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Net cash provided by operating activities
|
$
|
776,401
|
|
|
$
|
798,904
|
|
|
$
|
693,087
|
|
Net cash used in investing activities
|
(155,300
|
)
|
|
(394,487
|
)
|
|
(268,950
|
)
|
|||
Net cash used in financing activities
|
(293,745
|
)
|
|
(479,130
|
)
|
|
(409,111
|
)
|
|||
Effect of exchange rates on cash and cash equivalents
|
366
|
|
|
(1,700
|
)
|
|
5,046
|
|
|||
Net increase (decrease) in cash and cash equivalents
|
$
|
327,722
|
|
|
$
|
(76,413
|
)
|
|
$
|
20,072
|
|
|
Payments Due by Period
|
||||||||||||||||||
Contractual Obligations (1)
|
Total
|
|
Less than
1 Year
|
|
1-3 Years
|
|
3-5 Years
|
|
More than
5 years
|
||||||||||
Term loan - principal
|
$
|
617,654
|
|
|
$
|
33,387
|
|
|
$
|
66,773
|
|
|
$
|
517,494
|
|
|
$
|
—
|
|
Term loan - interest (2)
|
65,920
|
|
|
20,641
|
|
|
37,759
|
|
|
7,520
|
|
|
—
|
|
|||||
Exchangeable Senior Notes - principal
|
1,150,000
|
|
|
—
|
|
|
575,000
|
|
|
575,000
|
|
|
—
|
|
|||||
Exchangeable Senior Notes - interest (3)
|
64,688
|
|
|
19,406
|
|
|
28,031
|
|
|
17,251
|
|
|
—
|
|
|||||
Revolving credit facility - commitment fee (4)
|
13,922
|
|
|
4,067
|
|
|
8,111
|
|
|
1,744
|
|
|
—
|
|
|||||
Commitment to equity method investees
|
15,075
|
|
|
7,000
|
|
|
8,075
|
|
|
—
|
|
|
—
|
|
|||||
Purchase and other obligations (5)
|
98,034
|
|
|
74,488
|
|
|
17,551
|
|
|
5,908
|
|
|
87
|
|
|||||
Operating lease obligations (6)
|
213,578
|
|
|
21,315
|
|
|
42,243
|
|
|
45,365
|
|
|
104,655
|
|
|||||
Total
|
$
|
2,238,871
|
|
|
$
|
180,304
|
|
|
$
|
783,543
|
|
|
$
|
1,170,282
|
|
|
$
|
104,742
|
|
(1)
|
This table does not include potential future milestone payments or royalty obligations to third parties under asset purchase, product development, license and other agreements as the timing and likelihood of such milestone payments are not known, and, in the case of royalty obligations, as the amount of such obligations are not estimable. In December 2019, we entered into an exclusive license agreement with PharmaMar, for development and U.S. commercialization of lurbinectedin, a product candidate under clinical investigation for the treatment of patients with relapsed SCLC. The agreement became effective in January 2020 and we made an upfront payment of $200.0 million. PharmaMar is also eligible to receive milestone payments totaling up to $800.0 million based on regulatory and commercial milestones. PharmaMar is also eligible to receive incremental tiered royalties on future net sales of lurbinectedin ranging from the high teens up to 30 percent. In January 2019, we entered into a strategic collaboration agreement with Codiak for an exclusive, worldwide, royalty-bearing license to develop, manufacture and commercialize potential therapeutic candidates directed at five targets to be developed using Codiak’s engEx™ precision engineering platform for exosome therapeutics. Codiak is eligible to receive up to $20 million in preclinical development milestone payments. Codiak is also eligible to receive milestone payments totaling up to $200 million per target based on investigational NDA acceptance, clinical and regulatory milestones, including approvals in the U.S., the EU and Japan, and certain sales milestones. Codiak is also eligible to receive tiered royalties on net sales of each approved product. In August 2019, we announced the acquisition of Cavion, for an upfront payment of $52.5 million with the potential for additional payments of up to $260.0 million upon the achievement of certain clinical, regulatory and commercial milestones, for a total potential consideration of $312.5 million. In July 2019, we acquired a pan-RAF inhibitor program for the potential treatment of RAF and RAS mutant tumors from Redx. Redx is eligible to receive up to $203 million in development, regulatory and commercial milestone payments from us, as well as incremental tiered royalties in mid-single digit percentage based on any future net sales. In 2014, we acquired worldwide development, manufacturing and commercial rights to Sunosi from Aerial (other than in certain jurisdictions in Asia where SK Biopharmaceuticals Co., Ltd, or SK, retains rights). In January 2020, we received approval of Sunosi by the EC, triggering regulatory milestones of $10.0 million and $3.0 million to Aerial and SK, respectively. Aerial and SK are currently eligible to receive milestone payments up to an aggregate of $165 million based on sales milestones and tiered royalties from high single digits to mid-teens based on potential future sales of Sunosi. In July 2016, we entered into an agreement with Pfenex, which was subsequently amended in December 2017, that granted us worldwide rights to develop and commercialize multiple early-stage hematology product candidates and an option for us to negotiate a license for a recombinant pegaspargase product candidate with Pfenex. Under the amended agreement, Pfenex is eligible to receive future payments of up to $163 million based on the achievement of development, regulatory and sales milestones. Potential future milestone payments to other third parties under other agreements could be up to an aggregate of $123 million. These would become due and payable to other third parties upon the achievement of certain developmental, clinical, regulatory and/or commercial milestones, the timing and likelihood of which are not known. We are also obligated under these agreements to pay royalties on net sales of certain products at specified rates, which royalties are dependent on future product sales and are not provided for in the table above as they are not estimable.
|
(2)
|
Estimated interest for variable rate debt was calculated based on the interest rates in effect as of December 31, 2019. The interest rate for our term loan borrowing was 3.17% as of December 31, 2019. Interest that is fixed, associated with our interest rate swaps, is calculated based on the fixed interest swap rate as of December 31, 2019.
|
(3)
|
We used the fixed interest rates of 1.875% on the 2021 Notes and 1.50% on the 2024 Notes to estimate interest owed as of December 31, 2019 until the respective final maturity dates of these notes.
|
(4)
|
Our revolving credit facility has a commitment fee payable on the undrawn amount ranging from 0.25% to 0.35% per annum based upon our secured leverage ratio. In the table above, we used a rate of 0.25% and assumed undrawn amounts of $1.6 billion as of December 31, 2019 to estimate commitment fees owed.
|
(5)
|
Consists primarily of non-cancelable commitments to our third party manufacturers and to ImmunoGen under our amended collaboration and option agreement.
|
(6)
|
Consists primarily of the minimum lease payments for our office buildings and automobile lease payments for our sales force. Operating expenses associated with our leased office buildings are not included in table above.
|
|
Rebates Payable
|
|
Sales Returns Reserve
|
|
Chargebacks
|
|
Discounts and Distributor Fees
|
|
Total
|
||||||||||
Balance at December 31, 2016
|
$
|
68,263
|
|
|
$
|
4,366
|
|
|
$
|
4,749
|
|
|
$
|
4,199
|
|
|
$
|
81,577
|
|
Provision, net
|
144,596
|
|
|
446
|
|
|
41,941
|
|
|
36,642
|
|
|
223,625
|
|
|||||
Payments/credits
|
(135,697
|
)
|
|
(1,161
|
)
|
|
(43,027
|
)
|
|
(36,532
|
)
|
|
(216,417
|
)
|
|||||
Balance at December 31, 2017
|
77,162
|
|
|
3,651
|
|
|
3,663
|
|
|
4,309
|
|
|
88,785
|
|
|||||
Provision, net
|
160,648
|
|
|
1,203
|
|
|
41,387
|
|
|
42,956
|
|
|
246,194
|
|
|||||
Payments/credits
|
(156,696
|
)
|
|
(2,344
|
)
|
|
(44,642
|
)
|
|
(41,808
|
)
|
|
(245,490
|
)
|
|||||
Balance at December 31, 2018
|
81,114
|
|
|
2,510
|
|
|
408
|
|
|
5,457
|
|
|
89,489
|
|
|||||
Provision, net
|
153,930
|
|
|
5,519
|
|
|
41,864
|
|
|
56,041
|
|
|
257,354
|
|
|||||
Payments/credits
|
(152,191
|
)
|
|
(4,567
|
)
|
|
(41,138
|
)
|
|
(47,377
|
)
|
|
(245,273
|
)
|
|||||
Balance at December 31, 2019
|
$
|
82,853
|
|
|
$
|
3,462
|
|
|
$
|
1,134
|
|
|
$
|
14,121
|
|
|
$
|
101,570
|
|
•
|
estimating the timing of and expected costs to complete the in-process projects;
|
•
|
projecting regulatory approvals;
|
•
|
estimating future cash flows from product sales resulting from completed products and in-process projects; and
|
•
|
developing appropriate discount rates and probability rates by project.
|
Item 7A.
|
Quantitative and Qualitative Disclosures About Market Risk
|
Item 8.
|
Financial Statements and Supplementary Data
|
Item 9.
|
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
|
Item 9A.
|
Controls and Procedures
|
1.
|
Our management is responsible for establishing and maintaining adequate internal control over financial reporting.
|
2.
|
Our management used the Committee of Sponsoring Organizations of the Treadway Commission Internal Control - Integrated Framework (2013), or the COSO framework, to evaluate the effectiveness of internal control over financial reporting. Management believes that the COSO framework is a suitable framework for its evaluation of financial reporting because it is free from bias, permits reasonably consistent qualitative and quantitative measurements of our internal control over financial reporting, is sufficiently complete so that those relevant factors that would alter a conclusion about the effectiveness of our internal control over financial reporting are not omitted and is relevant to an evaluation of internal control over financial reporting.
|
3.
|
Management has assessed the effectiveness of our internal control over financial reporting as of December 31, 2019 and has concluded that such internal control over financial reporting was effective. There were no material weaknesses in internal control over financial reporting identified by management.
|
4.
|
KPMG, our independent registered public accounting firm, has audited the consolidated financial statements of Jazz Pharmaceuticals plc as of and for the year ended December 31, 2019, included herein, and has issued an audit report on our internal control over financial reporting, which is included below.
|
Item 9B.
|
Other Information
|
Item 10.
|
Directors, Executive Officers and Corporate Governance
|
•
|
The information relating to our directors and nominees for director is to be included in the section entitled “Proposal 1—Election of Directors;”
|
•
|
The information relating to our executive officers is to be included in the section entitled “Executive Officers;”
|
•
|
The information relating to our audit committee, audit committee financial expert and procedures by which shareholders may recommend nominees to our board of directors is to be included in the section entitled “Corporate Governance and Board Matters;” and
|
•
|
The information regarding compliance with Section 16(a) of the Exchange Act is to be included in the section entitled “Section 16(a) Beneficial Ownership Reporting Compliance.”
|
Item 11.
|
Executive Compensation
|
Item 12.
|
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
|
Item 13.
|
Certain Relationships and Related Transactions, and Director Independence
|
Item 14.
|
Principal Accountant Fees and Services
|
Item 15.
|
Exhibits and Financial Statement Schedules
|
1.
|
Index to Financial Statements:
|
2.
|
Financial Statement Schedules:
|
Exhibit
Number
|
|
Description of Document
|
|
2.1
|
|
|
|
2.2
|
|
|
|
2.3
|
|
|
|
2.4
|
|
|
|
2.5
|
|
|
2.6†
|
|
|
|
2.7†
|
|
|
|
2.8
|
|
|
|
2.9
|
|
|
|
3.1
|
|
|
|
4.1
|
|
|
|
4.3A
|
|
|
|
4.3B
|
|
|
|
4.4A
|
|
|
|
4.4B
|
|
|
|
4.5A
|
|
|
|
4.5B
|
|
|
|
4.6
|
|
|
|
10.1
|
|
|
|
10.2
|
|
|
|
10.3
|
|
|
10.4†
|
|
|
|
10.5†
|
|
|
|
10.6
|
|
|
|
10.7
|
|
|
|
10.8†
|
|
|
|
10.9A†
|
|
|
|
10.9B†
|
|
|
|
10.10‡
|
|
|
|
10.11A†
|
|
|
|
10.11B
|
|
|
|
10.12‡
|
|
|
|
10.13A
|
|
|
|
10.13B
|
|
|
10.13C
|
|
|
|
10.14A
|
|
|
|
10.14B
|
|
|
|
10.14C
|
|
|
|
10.15
|
|
|
|
10.16A
|
|
|
|
10.16B
|
|
|
|
10.16C
|
|
|
|
10.17A
|
|
|
|
10.17B
|
|
|
|
10.18+
|
|
|
|
10.19+
|
|
|
|
10.20+
|
|
|
|
10.21+
|
|
|
10.22+
|
|
|
|
10.23+
|
|
|
|
10.24+
|
|
|
|
10.25A+
|
|
|
|
10.25B+
|
|
|
|
10.25C+
|
|
|
|
10.26+
|
|
|
|
10.27+
|
|
|
|
10.28A+
|
|
|
|
10.28B+
|
|
|
|
10.29A+
|
|
|
|
10.29B+
|
|
|
|
10.29C+
|
|
|
|
10.29D+
|
|
|
|
10.29E+
|
|
|
|
10.29F+
|
|
|
|
10.29G+
|
|
|
10.29H+
|
|
|
|
10.30A+
|
|
|
|
10.30B+
|
|
|
|
10.30C+
|
|
|
|
10.30D+
|
|
|
|
10.30E+
|
|
|
|
10.30F+
|
|
|
|
10.30G+
|
|
|
|
10.30H+
|
|
|
|
10.30I+
|
|
|
|
10.30J+
|
|
|
|
10.30K+
|
|
|
|
10.30L+
|
|
|
|
10.30M+
|
|
|
10.30N+
|
|
|
|
10.30O+
|
|
|
|
10.30P+
|
|
|
|
10.30Q+
|
|
|
|
10.30R+
|
|
|
|
10.30S+
|
|
|
|
10.30T+
|
|
|
|
10.30U+
|
|
|
|
10.30V+
|
|
|
|
10.30W+
|
|
|
|
10.31+
|
|
|
|
10.32A+
|
|
|
|
10.32B+
|
|
|
|
10.32C+
|
|
|
10.32D+
|
|
|
|
10.32E+
|
|
|
|
10.32F+
|
|
|
|
10.32G+
|
|
|
|
10.32H+
|
|
|
|
10.32I+
|
|
|
|
10.32J+
|
|
|
|
10.32K+
|
|
|
|
10.33A+
|
|
|
|
10.33B+
|
|
|
|
10.34A+
|
|
|
|
10.34B+
|
|
|
|
10.34C+
|
|
|
|
10.34D+
|
|
|
|
10.35+
|
|
|
10.36A+
|
|
|
|
10.36B+
|
|
|
|
21.1
|
|
|
|
23.1
|
|
|
|
24.1
|
|
|
|
31.1
|
|
|
|
32.1*
|
|
|
|
101.INS
|
|
XBRL Instance Document - The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
|
|
101.SCH
|
|
Inline XBRL Taxonomy Extension Schema Document
|
|
101.CAL
|
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document
|
|
101.DEF
|
|
Inline XBRL Taxonomy Extension Definition Linkbase Document
|
|
101.LAB
|
|
Inline XBRL Taxonomy Extension Labels Linkbase Document
|
|
101.PRE
|
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document
|
|
104
|
|
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
|
|
+
|
Indicates management contract or compensatory plan.
|
†
|
Confidential treatment has been granted for portions of this exhibit. Omitted portions have been filed separately with the Securities and Exchange Commission.
|
‡
|
Pursuant to Item 601(b)(2) of Regulation S-K, certain portions of this agreement have been omitted because the omitted portions are both not material and would likely cause competitive harm to Jazz Pharmaceuticals if publicly disclosed.
|
*
|
The certifications attached as Exhibit 32.1 accompany this Annual Report on Form 10‑K pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, and shall not be deemed “filed” by the Registrant for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.
|
Item 16.
|
Form 10‑K Summary
|
Date: February 25, 2020
|
Jazz Pharmaceuticals public limited company
|
|
(Registrant)
|
|
/s/ BRUCE C. COZADD
|
|
Bruce C. Cozadd
Chairman and Chief Executive Officer and Director
(Principal Executive Officer and Interim Principal Financial Officer)
|
|
|
|
|
|
/s/ PATRICIA CARR
|
|
Patricia Carr
Vice President, Finance
(Principal Accounting Officer)
|
Signature
|
|
Title
|
|
Date
|
|
|
|
||
/s/ BRUCE C. COZADD
|
|
Chairman, Chief Executive Officer and Director
(Duly Authorizer Officer, Principal Executive Officer and Interim Principal Financial Officer)
|
|
February 25, 2020
|
Bruce C. Cozadd
|
|
|
||
/s/ PATRICIA CARR
|
|
Vice President, Finance
(Principal Accounting Officer)
|
|
February 25, 2020
|
Patricia Carr
|
|
|
||
/s/ PAUL L. BERNS
|
|
Director
|
|
February 25, 2020
|
Paul L. Berns
|
|
|
||
/s/ PATRICK G. ENRIGHT
|
|
Director
|
|
February 25, 2020
|
Patrick G. Enright
|
|
|
||
/s/ PETER GRAY
|
|
Director
|
|
February 25, 2020
|
Peter Gray
|
|
|
||
/s/ HEATHER ANN MCSHARRY
|
|
Director
|
|
February 25, 2020
|
Heather Ann McSharry
|
|
|
||
/s/ SEAMUS C. MULLIGAN
|
|
Director
|
|
February 25, 2020
|
Seamus C. Mulligan
|
|
|
||
/s/ KENNETH W. O’KEEFE
|
|
Director
|
|
February 25, 2020
|
Kenneth W. O’Keefe
|
|
|
||
/s/ ANNE O’RIORDAN
|
|
Director
|
|
February 25, 2020
|
Anne O’Riordan
|
|
|
||
/s/ NORBERT G. RIEDEL, PH.D.
|
|
Director
|
|
February 25, 2020
|
Norbert G. Riedel, Ph.D.
|
|
|
||
/s/ ELMAR SCHNEE
|
|
Director
|
|
February 25, 2020
|
Elmar Schnee
|
|
|
||
/s/ CATHERINE A. SOHN, PHARM.D.
|
|
Director
|
|
February 25, 2020
|
Catherine A. Sohn, Pharm.D.
|
|
|
||
/s/ RICK E WINNINGHAM
|
|
Director
|
|
February 25, 2020
|
Rick E Winningham
|
|
|
–
|
We tested certain internal controls over the Vyxeos and Erwinaze/se intangible asset impairment review processes, including controls related to the development of the revenue growth rate assumptions for Vyxeos and supply forecast assumptions for Erwinaze/se;
|
–
|
We compared the Company’s historical forecasted revenue growth rate assumptions for Vyxeos and historical supply forecast assumptions for Erwinaze/se to actual results to assess the Company’s ability to accurately forecast;
|
–
|
We evaluated the reasonableness of management’s revenue growth rate assumptions for Vyxeos and supply forecast assumptions for Erwinaze/se by comparing those assumptions to (1) company-specific operational information and management’s communications to the board of directors, (2) available third-party reports on expected market share, and (3) industry reports containing analyses of the Company’s and its competitor’s products; and
|
–
|
We performed sensitivity analyses over the revenue growth rate assumptions for Vyxeos and supply forecast assumptions for Erwinaze/se to assess the impact of changes to those assumptions on the Company’s determination of the carrying value of the Vyxeos and Erwinaze/se intangible assets.
|
–
|
We tested certain internal controls over the Company’s deferred tax asset valuation allowance process including controls related to the development of revenue growth rate assumptions;
|
–
|
We involved income tax professionals with specialized skills and knowledge, who assisted in performing a technical assessment of the Company’s tax positions, application of the relevant tax regulations and utilization of NOLs and tax credits; and
|
–
|
To assess the Company’s ability to forecast, we compared the Company’s previous forecasts to actual historic outcomes and compared current assumptions to underlying calculations. We assessed the integrity of underlying calculations and we checked certain information to third party sources, including expectations of performance of certain assets.
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
637,344
|
|
|
$
|
309,622
|
|
Investments
|
440,000
|
|
|
515,000
|
|
||
Accounts receivable, net of allowances of $1,296 and $534 at December 31, 2019 and 2018, respectively
|
355,987
|
|
|
263,838
|
|
||
Inventories
|
78,608
|
|
|
52,956
|
|
||
Prepaid expenses
|
39,434
|
|
|
25,017
|
|
||
Other current assets
|
78,895
|
|
|
67,572
|
|
||
Total current assets
|
1,630,268
|
|
|
1,234,005
|
|
||
Property, plant and equipment, net
|
131,506
|
|
|
200,358
|
|
||
Operating lease assets
|
139,385
|
|
|
—
|
|
||
Intangible assets, net
|
2,440,977
|
|
|
2,731,334
|
|
||
Goodwill
|
920,018
|
|
|
927,630
|
|
||
Deferred tax assets, net
|
221,403
|
|
|
57,879
|
|
||
Deferred financing costs
|
7,426
|
|
|
9,589
|
|
||
Other non-current assets
|
47,914
|
|
|
42,696
|
|
||
Total assets
|
$
|
5,538,897
|
|
|
$
|
5,203,491
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
47,545
|
|
|
$
|
40,602
|
|
Accrued liabilities
|
267,873
|
|
|
264,887
|
|
||
Current portion of long-term debt
|
33,387
|
|
|
33,387
|
|
||
Income taxes payable
|
10,965
|
|
|
1,197
|
|
||
Deferred revenue
|
4,720
|
|
|
5,414
|
|
||
Total current liabilities
|
364,490
|
|
|
345,487
|
|
||
Deferred revenue, non-current
|
4,861
|
|
|
9,581
|
|
||
Long-term debt, less current portion
|
1,573,870
|
|
|
1,563,025
|
|
||
Operating lease liabilities, less current portion
|
151,226
|
|
|
—
|
|
||
Deferred tax liabilities, net
|
224,095
|
|
|
309,097
|
|
||
Other non-current liabilities
|
109,374
|
|
|
218,879
|
|
||
Commitments and contingencies (Note 13)
|
|
|
|
||||
Shareholders’ equity:
|
|
|
|
||||
Ordinary shares, nominal value $0.0001 per share; 300,000 shares authorized; 56,140 and 57,504 shares issued and outstanding at December 31, 2019 and 2018, respectively
|
6
|
|
|
6
|
|
||
Non-voting euro deferred shares, €0.01 par value per share; 4,000 shares authorized, issued and outstanding at both December 31, 2019 and 2018
|
55
|
|
|
55
|
|
||
Capital redemption reserve
|
472
|
|
|
472
|
|
||
Additional paid-in capital
|
2,266,026
|
|
|
2,113,630
|
|
||
Accumulated other comprehensive loss
|
(223,393
|
)
|
|
(197,791
|
)
|
||
Retained earnings
|
1,067,815
|
|
|
841,050
|
|
||
Total shareholders’ equity
|
3,110,981
|
|
|
2,757,422
|
|
||
Total liabilities and shareholders’ equity
|
$
|
5,538,897
|
|
|
$
|
5,203,491
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Revenues:
|
|
|
|
|
|
||||||
Product sales, net
|
$
|
2,135,601
|
|
|
$
|
1,869,473
|
|
|
$
|
1,601,399
|
|
Royalties and contract revenues
|
26,160
|
|
|
21,449
|
|
|
17,294
|
|
|||
Total revenues
|
2,161,761
|
|
|
1,890,922
|
|
|
1,618,693
|
|
|||
Operating expenses:
|
|
|
|
|
|
||||||
Cost of product sales (excluding amortization of acquired developed technologies)
|
127,930
|
|
|
121,544
|
|
|
110,188
|
|
|||
Selling, general and administrative
|
736,942
|
|
|
683,530
|
|
|
544,156
|
|
|||
Research and development
|
299,726
|
|
|
226,616
|
|
|
198,442
|
|
|||
Intangible asset amortization
|
354,814
|
|
|
201,498
|
|
|
152,065
|
|
|||
Impairment charges
|
—
|
|
|
42,896
|
|
|
—
|
|
|||
Acquired in-process research and development
|
109,975
|
|
|
—
|
|
|
85,000
|
|
|||
Total operating expenses
|
1,629,387
|
|
|
1,276,084
|
|
|
1,089,851
|
|
|||
Income from operations
|
532,374
|
|
|
614,838
|
|
|
528,842
|
|
|||
Interest expense, net
|
(72,261
|
)
|
|
(77,075
|
)
|
|
(77,756
|
)
|
|||
Foreign exchange loss
|
(5,811
|
)
|
|
(6,875
|
)
|
|
(9,969
|
)
|
|||
Loss on extinguishment and modification of debt
|
—
|
|
|
(1,425
|
)
|
|
—
|
|
|||
Income before income tax provision (benefit) and equity in loss of investees
|
454,302
|
|
|
529,463
|
|
|
441,117
|
|
|||
Income tax provision (benefit)
|
(73,154
|
)
|
|
80,162
|
|
|
(47,740
|
)
|
|||
Equity in loss of investees
|
4,089
|
|
|
2,203
|
|
|
1,009
|
|
|||
Net income
|
$
|
523,367
|
|
|
$
|
447,098
|
|
|
$
|
487,848
|
|
|
|
|
|
|
|
||||||
Net income per ordinary share:
|
|
|
|
|
|
||||||
Basic
|
$
|
9.22
|
|
|
$
|
7.45
|
|
|
$
|
8.13
|
|
Diluted
|
$
|
9.09
|
|
|
$
|
7.30
|
|
|
$
|
7.96
|
|
Weighted-average ordinary shares used in per share calculations - basic
|
56,749
|
|
|
59,976
|
|
|
60,018
|
|
|||
Weighted-average ordinary shares used in per share calculations - diluted
|
57,550
|
|
|
61,221
|
|
|
61,317
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Net income
|
$
|
523,367
|
|
|
$
|
447,098
|
|
|
$
|
487,848
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
(20,720
|
)
|
|
(58,988
|
)
|
|
174,973
|
|
|||
Unrealized gain (loss) on hedging activities, net of income tax provision (benefit) of ($697), $289 and $212, respectively
|
(4,882
|
)
|
|
2,022
|
|
|
1,482
|
|
|||
Other comprehensive income (loss)
|
(25,602
|
)
|
|
(56,966
|
)
|
|
176,455
|
|
|||
Total comprehensive income
|
$
|
497,765
|
|
|
$
|
390,132
|
|
|
$
|
664,303
|
|
|
Ordinary Shares
|
|
Non-voting Euro Deferred
|
|
Capital Redemption Reserve
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Retained Earnings
|
|
Total
Equity
|
||||||||||||||||||||
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|||||||||||||||||||||||||
Balance at December 31, 2016
|
59,820
|
|
|
$
|
6
|
|
|
4,000
|
|
|
$
|
55
|
|
|
$
|
472
|
|
|
$
|
1,665,232
|
|
|
$
|
(317,333
|
)
|
|
$
|
528,907
|
|
|
$
|
1,877,339
|
|
Issuance of Exchangeable Senior Notes
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
149,767
|
|
|
—
|
|
|
—
|
|
|
149,767
|
|
|||||||
Issuance of ordinary shares in conjunction with exercise of share options
|
428
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
22,683
|
|
|
—
|
|
|
—
|
|
|
22,683
|
|
|||||||
Issuance of ordinary shares under employee stock purchase plan
|
104
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9,141
|
|
|
—
|
|
|
—
|
|
|
9,141
|
|
|||||||
Issuance of ordinary shares in conjunction with vesting of restricted stock units
|
250
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Shares withheld for payment of employee's withholding tax liability
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(18,589
|
)
|
|
—
|
|
|
—
|
|
|
(18,589
|
)
|
|||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
107,252
|
|
|
—
|
|
|
—
|
|
|
107,252
|
|
|||||||
Shares repurchased
|
(704
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(98,799
|
)
|
|
(98,799
|
)
|
|||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
176,455
|
|
|
—
|
|
|
176,455
|
|
|||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
487,848
|
|
|
487,848
|
|
|||||||
Balance at December 31, 2017
|
59,898
|
|
|
6
|
|
|
4,000
|
|
|
55
|
|
|
472
|
|
|
1,935,486
|
|
|
(140,878
|
)
|
|
917,956
|
|
|
2,713,097
|
|
|||||||
Cumulative effect adjustment from adoption of new accounting standards
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
53
|
|
|
(332
|
)
|
|
(279
|
)
|
|||||||
Issuance of ordinary shares in conjunction with exercise of share options
|
772
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
82,918
|
|
|
—
|
|
|
—
|
|
|
82,918
|
|
|||||||
Issuance of ordinary shares under employee stock purchase plan
|
111
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,419
|
|
|
—
|
|
|
—
|
|
|
10,419
|
|
|||||||
Issuance of ordinary shares in conjunction with vesting of restricted stock units
|
253
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Shares withheld for payment of employee's withholding tax liability
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17,925
|
)
|
|
—
|
|
|
—
|
|
|
(17,925
|
)
|
|||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
102,732
|
|
|
—
|
|
|
—
|
|
|
102,732
|
|
|||||||
Shares repurchased
|
(3,530
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(523,672
|
)
|
|
(523,672
|
)
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(56,966
|
)
|
|
—
|
|
|
(56,966
|
)
|
|||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
447,098
|
|
|
447,098
|
|
|||||||
Balance at December 31, 2018
|
57,504
|
|
|
$
|
6
|
|
|
4,000
|
|
|
$
|
55
|
|
|
$
|
472
|
|
|
$
|
2,113,630
|
|
|
$
|
(197,791
|
)
|
|
$
|
841,050
|
|
|
$
|
2,757,422
|
|
|
Ordinary Shares
|
|
Non-voting Euro Deferred
|
|
Capital Redemption Reserve
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Retained Earnings
|
|
Total
Equity
|
||||||||||||||||||||
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|||||||||||||||||||||||||
Balance at December 31, 2018
|
57,504
|
|
|
$
|
6
|
|
|
4,000
|
|
|
$
|
55
|
|
|
$
|
472
|
|
|
$
|
2,113,630
|
|
|
$
|
(197,791
|
)
|
|
$
|
841,050
|
|
|
$
|
2,757,422
|
|
Cumulative effect adjustment from adoption of new accounting standards
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,848
|
|
|
4,848
|
|
|||||||
Issuance of ordinary shares in conjunction with exercise of share options
|
515
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
46,477
|
|
|
—
|
|
|
—
|
|
|
46,477
|
|
|||||||
Issuance of ordinary shares under employee stock purchase plan
|
106
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,354
|
|
|
—
|
|
|
—
|
|
|
11,354
|
|
|||||||
Issuance of ordinary shares in conjunction with vesting of restricted stock units
|
265
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Shares withheld for payment of employee's withholding tax liability
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(16,739
|
)
|
|
—
|
|
|
—
|
|
|
(16,739
|
)
|
|||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
111,304
|
|
|
—
|
|
|
—
|
|
|
111,304
|
|
|||||||
Shares repurchased
|
(2,250
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(301,450
|
)
|
|
(301,450
|
)
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25,602
|
)
|
|
—
|
|
|
(25,602
|
)
|
|||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
523,367
|
|
|
523,367
|
|
|||||||
Balance at December 31, 2019
|
56,140
|
|
|
$
|
6
|
|
|
4,000
|
|
|
$
|
55
|
|
|
$
|
472
|
|
|
$
|
2,266,026
|
|
|
$
|
(223,393
|
)
|
|
$
|
1,067,815
|
|
|
$
|
3,110,981
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Operating activities
|
|
|
|
|
|
||||||
Net income
|
$
|
523,367
|
|
|
$
|
447,098
|
|
|
$
|
487,848
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Intangible asset amortization
|
354,814
|
|
|
201,498
|
|
|
152,065
|
|
|||
Share-based compensation
|
110,563
|
|
|
102,441
|
|
|
106,900
|
|
|||
Impairment charges
|
—
|
|
|
42,896
|
|
|
—
|
|
|||
Depreciation
|
15,342
|
|
|
15,233
|
|
|
13,089
|
|
|||
Acquired in-process research and development
|
109,975
|
|
|
—
|
|
|
85,000
|
|
|||
Loss on disposal of assets
|
21
|
|
|
655
|
|
|
473
|
|
|||
Deferred tax benefit
|
(236,610
|
)
|
|
(88,815
|
)
|
|
(225,591
|
)
|
|||
Provision for losses on accounts receivable and inventory
|
6,668
|
|
|
4,728
|
|
|
2,190
|
|
|||
Loss on extinguishment and modification of debt
|
—
|
|
|
1,425
|
|
|
—
|
|
|||
Amortization of debt discount and deferred financing costs
|
46,396
|
|
|
43,960
|
|
|
30,026
|
|
|||
Other non-cash transactions
|
(4,051
|
)
|
|
4,499
|
|
|
14,321
|
|
|||
Changes in assets and liabilities:
|
|
|
|
|
|
||||||
Accounts receivable
|
(92,326
|
)
|
|
(40,132
|
)
|
|
12,278
|
|
|||
Inventories
|
(32,790
|
)
|
|
(18,512
|
)
|
|
(8,667
|
)
|
|||
Prepaid expenses and other current assets
|
(25,650
|
)
|
|
6,697
|
|
|
(26,874
|
)
|
|||
Other non-current assets
|
(14,830
|
)
|
|
(320
|
)
|
|
119
|
|
|||
Operating lease assets
|
14,148
|
|
|
—
|
|
|
—
|
|
|||
Accounts payable
|
4,770
|
|
|
17,040
|
|
|
214
|
|
|||
Accrued liabilities
|
(5,565
|
)
|
|
71,208
|
|
|
(6,578
|
)
|
|||
Income taxes payable
|
10,056
|
|
|
(19,735
|
)
|
|
16,331
|
|
|||
Deferred revenue
|
(5,414
|
)
|
|
(7,497
|
)
|
|
21,009
|
|
|||
Other non-current liabilities
|
3,561
|
|
|
14,537
|
|
|
18,934
|
|
|||
Operating lease liabilities, less current portion
|
(6,044
|
)
|
|
—
|
|
|
—
|
|
|||
Net cash provided by operating activities
|
776,401
|
|
|
798,904
|
|
|
693,087
|
|
|||
Investing activities
|
|
|
|
|
|
||||||
Acquisition of investments
|
(917,100
|
)
|
|
(1,165,915
|
)
|
|
(385,000
|
)
|
|||
Proceeds from maturity of investments
|
985,000
|
|
|
855,000
|
|
|
230,000
|
|
|||
Acquired in-process research and development
|
(61,700
|
)
|
|
—
|
|
|
(85,000
|
)
|
|||
Purchases of property, plant and equipment
|
(40,135
|
)
|
|
(20,370
|
)
|
|
(28,950
|
)
|
|||
Asset acquisition, net of cash acquired
|
(55,074
|
)
|
|
—
|
|
|
—
|
|
|||
Acquisition of intangible assets
|
(80,500
|
)
|
|
(111,100
|
)
|
|
—
|
|
|||
Net proceeds from sale of assets
|
14,209
|
|
|
47,898
|
|
|
—
|
|
|||
Net cash used in investing activities
|
(155,300
|
)
|
|
(394,487
|
)
|
|
(268,950
|
)
|
|||
Financing activities
|
|
|
|
|
|
||||||
Proceeds from employee equity incentive and purchase plans
|
57,831
|
|
|
93,337
|
|
|
31,824
|
|
|||
Share repurchases
|
(301,450
|
)
|
|
(523,672
|
)
|
|
(98,799
|
)
|
|||
Payment of employee withholding taxes related to share-based awards
|
(16,739
|
)
|
|
(17,925
|
)
|
|
(18,589
|
)
|
|||
Repayments of long-term debt
|
(33,387
|
)
|
|
(25,717
|
)
|
|
(36,094
|
)
|
|||
Payment of debt modification costs
|
—
|
|
|
(6,406
|
)
|
|
—
|
|
|||
Repayments under revolving credit facility
|
—
|
|
|
—
|
|
|
(850,000
|
)
|
|||
Proceeds from tenant improvement allowance on build-to-suit lease
|
—
|
|
|
1,253
|
|
|
3,154
|
|
|||
Net proceeds from issuance of debt
|
—
|
|
|
—
|
|
|
559,393
|
|
|||
Net cash used in financing activities
|
(293,745
|
)
|
|
(479,130
|
)
|
|
(409,111
|
)
|
|||
Effect of exchange rates on cash and cash equivalents
|
366
|
|
|
(1,700
|
)
|
|
5,046
|
|
|||
Net increase (decrease) in cash and cash equivalents
|
327,722
|
|
|
(76,413
|
)
|
|
20,072
|
|
|||
Cash and cash equivalents, at beginning of period
|
309,622
|
|
|
386,035
|
|
|
365,963
|
|
|||
Cash and cash equivalents, at end of period
|
$
|
637,344
|
|
|
$
|
309,622
|
|
|
$
|
386,035
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
||||||
Cash paid for interest
|
$
|
43,002
|
|
|
$
|
42,706
|
|
|
$
|
44,609
|
|
Cash paid for income taxes
|
183,610
|
|
|
164,217
|
|
|
174,124
|
|
|||
Non-cash investing activities:
|
|
|
|
|
|
||||||
Amounts capitalized in connection with facility lease obligations
|
—
|
|
|
27,747
|
|
|
40,970
|
|
•
|
Xyrem® (sodium oxybate) oral solution, the only product approved by the U.S. Food and Drug Administration, or FDA, and marketed in the U.S. for the treatment of both cataplexy and excessive daytime sleepiness, or EDS, in both adult and pediatric patients with narcolepsy;
|
•
|
Sunosi® (solriamfetol), a product approved by the FDA and marketed in the U.S. to improve wakefulness in adult patients with EDS associated with narcolepsy or obstructive sleep apnea and also approved in Europe in January 2020 by the European Commission;
|
•
|
Defitelio® (defibrotide sodium), a product approved in the U.S. for the treatment of adult and pediatric patients with hepatic veno-occlusive disease, or VOD, also known as sinusoidal obstruction syndrome, with renal or pulmonary dysfunction following hematopoietic stem cell transplantation, or HSCT, and in Europe (where it is marketed as Defitelio® (defibrotide)) for the treatment of severe VOD in adults and children undergoing HSCT therapy;
|
•
|
Erwinaze® (asparaginase Erwinia chrysanthemi), a treatment approved in the U.S. and in certain markets in Europe (where it is marketed as Erwinase®) for patients with acute lymphoblastic leukemia who have developed hypersensitivity to E. coli-derived asparaginase; and
|
•
|
Vyxeos® (daunorubicin and cytarabine) liposome for injection, a product approved in the U.S. and in Europe (where it is marketed as Vyxeos® liposomal 44 mg/100 mg powder for concentrate for solution for infusion) for the treatment of adults with newly-diagnosed therapy-related acute myeloid leukemia, or AML, or AML with myelodysplasia-related changes.
|
•
|
Strong financial execution through growth in sales of our current lead marketed products;
|
•
|
Building a diversified product portfolio and development pipeline through a combination of our internal research and development efforts and obtaining rights to clinically meaningful and differentiated on- or near-market products and early- to late-stage product candidates through acquisitions, collaborations, licensing arrangements, partnerships and venture investments; and
|
•
|
Maximizing the value of our products and product candidates by continuing to implement our comprehensive global development plans, including through generating additional clinical data and seeking regulatory approval for new indications and new geographies.
|
|
Balance at December 31,
2018 |
|
Transition Adjustments
|
|
Balance at January 1,
2019 |
||||||
Assets:
|
|
|
|
|
|
||||||
Property, plant and equipment, net
|
$
|
200,358
|
|
|
$
|
(95,397
|
)
|
|
$
|
104,961
|
|
Operating lease assets
|
—
|
|
|
149,442
|
|
|
149,442
|
|
|||
Liabilities:
|
|
|
|
|
|
||||||
Accrued liabilities
|
264,887
|
|
|
8,165
|
|
|
273,052
|
|
|||
Operating lease liabilities, less current portion
|
—
|
|
|
153,158
|
|
|
153,158
|
|
|||
Deferred tax liabilities, net
|
309,097
|
|
|
1,489
|
|
|
310,586
|
|
|||
Other non-current liabilities
|
218,879
|
|
|
(113,615
|
)
|
|
105,264
|
|
|||
Shareholders' Equity:
|
|
|
|
|
|
||||||
Retained earnings
|
841,050
|
|
|
4,848
|
|
|
845,898
|
|
Buildings
|
40 years
|
Manufacturing equipment and machinery
|
5-10 years
|
Computer software and equipment
|
3-7 years
|
Furniture and fixtures
|
5 years
|
Consideration
|
|
||
Upfront payment for acquisition of Cavion's outstanding shares
|
$
|
52,500
|
|
Cash acquired
|
397
|
|
|
Working capital adjustment
|
(255
|
)
|
|
Transaction costs
|
2,829
|
|
|
Total consideration
|
$
|
55,471
|
|
|
|
||
Assets Acquired and Liabilities Assumed
|
|
||
Cash
|
$
|
397
|
|
In-process research and development
|
48,275
|
|
|
Deferred tax assets
|
7,995
|
|
|
Other assets and liabilities
|
(1,196
|
)
|
|
Total net assets acquired
|
$
|
55,471
|
|
|
December 31, 2019
|
||||||||||||||||||||||
|
Amortized
Cost |
|
Gross
Unrealized Gains |
|
Gross
Unrealized Losses |
|
Estimated
Fair Value |
|
Cash and
Cash Equivalents |
|
Investments
|
||||||||||||
Cash
|
$
|
333,172
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
333,172
|
|
|
$
|
333,172
|
|
|
$
|
—
|
|
Time deposits
|
460,000
|
|
|
—
|
|
|
—
|
|
|
460,000
|
|
|
20,000
|
|
|
440,000
|
|
||||||
Money market funds
|
284,172
|
|
|
—
|
|
|
—
|
|
|
284,172
|
|
|
284,172
|
|
|
—
|
|
||||||
Totals
|
$
|
1,077,344
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,077,344
|
|
|
$
|
637,344
|
|
|
$
|
440,000
|
|
|
December 31, 2018
|
||||||||||||||||||||||
|
Amortized
Cost |
|
Gross
Unrealized Gains |
|
Gross
Unrealized Losses |
|
Estimated
Fair Value |
|
Cash and
Cash Equivalents |
|
Investments
|
||||||||||||
Cash
|
$
|
215,606
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
215,606
|
|
|
$
|
215,606
|
|
|
$
|
—
|
|
Time deposits
|
515,000
|
|
|
—
|
|
|
—
|
|
|
515,000
|
|
|
—
|
|
|
515,000
|
|
||||||
Money market funds
|
94,016
|
|
|
—
|
|
|
—
|
|
|
94,016
|
|
|
94,016
|
|
|
—
|
|
||||||
Totals
|
$
|
824,622
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
824,622
|
|
|
$
|
309,622
|
|
|
$
|
515,000
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
Quoted
Prices in Active Markets for Identical Assets (Level 1) |
|
Significant
Other Observable Inputs (Level 2) |
|
Total
Estimated Fair Value |
|
Quoted
Prices in Active Markets for Identical Assets (Level 1) |
|
Significant
Other Observable Inputs (Level 2) |
|
Total
Estimated Fair Value |
||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Time deposits
|
$
|
—
|
|
|
$
|
460,000
|
|
|
$
|
460,000
|
|
|
$
|
—
|
|
|
$
|
515,000
|
|
|
$
|
515,000
|
|
Money market funds
|
284,172
|
|
|
—
|
|
|
284,172
|
|
|
94,016
|
|
|
—
|
|
|
94,016
|
|
||||||
Interest rate contracts
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,070
|
|
|
4,070
|
|
||||||
Foreign exchange forward contracts
|
—
|
|
|
2,508
|
|
|
2,508
|
|
|
—
|
|
|
1,194
|
|
|
1,194
|
|
||||||
Totals
|
$
|
284,172
|
|
|
$
|
462,508
|
|
|
$
|
746,680
|
|
|
$
|
94,016
|
|
|
$
|
520,264
|
|
|
$
|
614,280
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest rate contracts
|
$
|
—
|
|
|
$
|
1,515
|
|
|
$
|
1,515
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Foreign exchange forward contracts
|
—
|
|
|
182
|
|
|
182
|
|
|
—
|
|
|
1,460
|
|
|
1,460
|
|
||||||
Totals
|
$
|
—
|
|
|
$
|
1,697
|
|
|
$
|
1,697
|
|
|
$
|
—
|
|
|
$
|
1,460
|
|
|
$
|
1,460
|
|
|
Year Ended December 31,
|
||||||||||
Interest Rate Contracts:
|
2019
|
|
2018
|
|
2017
|
||||||
Gain (loss) recognized in accumulated other comprehensive loss, net of tax
|
$
|
(3,903
|
)
|
|
$
|
2,274
|
|
|
$
|
(213
|
)
|
Loss (gain) reclassified from accumulated other comprehensive loss to interest expense, net of tax
|
$
|
(979
|
)
|
|
$
|
(252
|
)
|
|
$
|
1,695
|
|
|
Year Ended December 31,
|
||||||||||
Foreign Exchange Forward Contracts:
|
2019
|
|
2018
|
|
2017
|
||||||
Gain (loss) recognized in foreign exchange loss
|
$
|
(6,192
|
)
|
|
$
|
(14,648
|
)
|
|
$
|
17,902
|
|
|
December 31, 2019
|
||||||||||
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||
|
Balance Sheet Location
|
|
Fair Value
|
|
Balance Sheet Location
|
|
Fair Value
|
||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
||||
Interest rate contracts
|
Other current assets
|
|
$
|
—
|
|
|
Accrued liabilities
|
|
$
|
855
|
|
|
|
|
|
|
Other non-current liabilities
|
|
660
|
|
|||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
||||
Foreign exchange forward contracts
|
Other current assets
|
|
2,508
|
|
|
Accrued liabilities
|
|
182
|
|
||
Total fair value of derivative instruments
|
|
|
$
|
2,508
|
|
|
|
|
$
|
1,697
|
|
|
December 31, 2018
|
||||||||||
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||
|
Balance Sheet Location
|
|
Fair Value
|
|
Balance Sheet Location
|
|
Fair Value
|
||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
||||
Interest rate contracts
|
Other current assets
|
|
$
|
1,929
|
|
|
Accrued liabilities
|
|
$
|
—
|
|
|
Other non-current assets
|
|
2,141
|
|
|
|
|
|
|||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
||||
Foreign exchange forward contracts
|
Other current assets
|
|
1,194
|
|
|
Accrued liabilities
|
|
1,460
|
|
||
Total fair value of derivative instruments
|
|
|
$
|
5,264
|
|
|
|
|
$
|
1,460
|
|
|
December 31, 2019
|
||||||||||||||||||||||
|
Gross Amounts of Recognized Assets/ Liabilities
|
|
Gross Amounts Offset in the Consolidated Balance Sheet
|
|
Net Amounts of Assets/ Liabilities Presented in the Consolidated Balance Sheet
|
|
Gross Amounts Not Offset in the Consolidated Balance Sheet
|
||||||||||||||||
Description
|
|
|
|
Derivative Financial Instruments
|
|
Cash Collateral Received (Pledged)
|
|
Net Amount
|
|||||||||||||||
Derivative assets
|
$
|
2,508
|
|
|
$
|
—
|
|
|
$
|
2,508
|
|
|
$
|
(596
|
)
|
|
$
|
—
|
|
|
$
|
1,912
|
|
Derivative liabilities
|
$
|
(1,697
|
)
|
|
$
|
—
|
|
|
$
|
(1,697
|
)
|
|
$
|
596
|
|
|
$
|
—
|
|
|
$
|
(1,101
|
)
|
|
December 31, 2018
|
||||||||||||||||||||||
|
Gross Amounts of Recognized Assets/ Liabilities
|
|
Gross Amounts Offset in the Consolidated Balance Sheet
|
|
Net Amounts of Assets/ Liabilities Presented in the Consolidated Balance Sheet
|
|
Gross Amounts Not Offset in the Consolidated Balance Sheet
|
||||||||||||||||
Description
|
|
|
|
Derivative Financial Instruments
|
|
Cash Collateral Received (Pledged)
|
|
Net Amount
|
|||||||||||||||
Derivative assets
|
$
|
5,264
|
|
|
$
|
—
|
|
|
$
|
5,264
|
|
|
$
|
(935
|
)
|
|
$
|
—
|
|
|
$
|
4,329
|
|
Derivative liabilities
|
$
|
(1,460
|
)
|
|
$
|
—
|
|
|
$
|
(1,460
|
)
|
|
$
|
935
|
|
|
$
|
—
|
|
|
$
|
(525
|
)
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Raw materials
|
$
|
13,595
|
|
|
$
|
10,895
|
|
Work in process
|
36,658
|
|
|
20,743
|
|
||
Finished goods
|
28,355
|
|
|
21,318
|
|
||
Total inventories
|
$
|
78,608
|
|
|
$
|
52,956
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Leasehold improvements
|
$
|
52,294
|
|
|
$
|
33,273
|
|
Land and buildings
|
47,053
|
|
|
46,650
|
|
||
Manufacturing equipment and machinery
|
28,860
|
|
|
25,837
|
|
||
Computer software
|
25,680
|
|
|
19,062
|
|
||
Computer equipment
|
16,577
|
|
|
13,679
|
|
||
Furniture and fixtures
|
11,152
|
|
|
8,155
|
|
||
Construction-in-progress
|
5,147
|
|
|
51,243
|
|
||
Build-to-suit facility
|
—
|
|
|
52,067
|
|
||
Subtotal
|
186,763
|
|
|
249,966
|
|
||
Less accumulated depreciation and amortization
|
(55,257
|
)
|
|
(49,608
|
)
|
||
Property, plant and equipment, net
|
$
|
131,506
|
|
|
$
|
200,358
|
|
Balance at December 31, 2018
|
$
|
927,630
|
|
Foreign exchange
|
(7,612
|
)
|
|
Balance at December 31, 2019
|
$
|
920,018
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||||
|
Remaining
Weighted- Average Useful Life (In years) |
|
Gross
Carrying Amount |
|
Accumulated
Amortization |
|
Net Book
Value |
|
Gross
Carrying Amount |
|
Accumulated
Amortization |
|
Net Book
Value |
||||||||||||
Acquired developed technologies
|
13.3
|
|
$
|
3,166,485
|
|
|
$
|
(864,834
|
)
|
|
$
|
2,301,651
|
|
|
$
|
3,110,641
|
|
|
$
|
(632,413
|
)
|
|
$
|
2,478,228
|
|
Priority review voucher (PRV)
|
—
|
|
111,101
|
|
|
(111,101
|
)
|
|
—
|
|
|
111,101
|
|
|
—
|
|
|
111,101
|
|
||||||
Manufacturing contracts
|
—
|
|
12,025
|
|
|
(12,025
|
)
|
|
—
|
|
|
12,256
|
|
|
(12,256
|
)
|
|
—
|
|
||||||
Trademarks
|
—
|
|
2,890
|
|
|
(2,890
|
)
|
|
—
|
|
|
2,896
|
|
|
(2,896
|
)
|
|
—
|
|
||||||
Total finite-lived intangible assets
|
|
|
3,292,501
|
|
|
(990,850
|
)
|
|
2,301,651
|
|
|
3,236,894
|
|
|
(647,565
|
)
|
|
2,589,329
|
|
||||||
Acquired IPR&D assets
|
|
|
139,326
|
|
|
—
|
|
|
139,326
|
|
|
142,005
|
|
|
—
|
|
|
142,005
|
|
||||||
Total intangible assets
|
|
|
$
|
3,431,827
|
|
|
$
|
(990,850
|
)
|
|
$
|
2,440,977
|
|
|
$
|
3,378,899
|
|
|
$
|
(647,565
|
)
|
|
$
|
2,731,334
|
|
Year Ending December 31,
|
Estimated Amortization Expense
|
||
2020
|
$
|
251,032
|
|
2021
|
204,025
|
|
|
2022
|
159,038
|
|
|
2023
|
159,038
|
|
|
2024
|
159,038
|
|
|
Thereafter
|
1,369,480
|
|
|
Total
|
$
|
2,301,651
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Rebates and other sales deductions
|
$
|
96,860
|
|
|
$
|
86,495
|
|
Employee compensation and benefits
|
80,290
|
|
|
58,543
|
|
||
Current portion of operating lease liabilities
|
12,728
|
|
|
—
|
|
||
Selling and marketing accruals
|
11,299
|
|
|
6,780
|
|
||
Inventory-related accruals
|
7,816
|
|
|
8,753
|
|
||
Accrued interest
|
7,386
|
|
|
7,407
|
|
||
Royalties
|
6,931
|
|
|
2,679
|
|
||
Professional fees
|
4,718
|
|
|
2,333
|
|
||
Sales returns reserve
|
3,462
|
|
|
2,510
|
|
||
Clinical trial accruals
|
2,551
|
|
|
5,904
|
|
||
Accrued construction-in-progress
|
1,564
|
|
|
1,065
|
|
||
Derivative instrument liabilities
|
1,037
|
|
|
1,460
|
|
||
Accrued loss contingency
|
—
|
|
|
58,154
|
|
||
Other
|
31,231
|
|
|
22,804
|
|
||
Total accrued liabilities
|
$
|
267,873
|
|
|
$
|
264,887
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
2021 Notes
|
$
|
575,000
|
|
|
$
|
575,000
|
|
Unamortized discount and debt issuance costs on 2021 Notes
|
(38,865
|
)
|
|
(60,910
|
)
|
||
2021 Notes, net
|
536,135
|
|
|
514,090
|
|
||
|
|
|
|
||||
2024 Notes
|
575,000
|
|
|
575,000
|
|
||
Unamortized discount and debt issuance costs on 2024 Notes
|
(117,859
|
)
|
|
(138,914
|
)
|
||
2024 Notes, net
|
457,141
|
|
|
436,086
|
|
||
|
|
|
|
||||
Term loan
|
613,981
|
|
|
646,236
|
|
||
Total debt
|
1,607,257
|
|
|
1,596,412
|
|
||
Less current portion
|
33,387
|
|
|
33,387
|
|
||
Total long-term debt
|
$
|
1,573,870
|
|
|
$
|
1,563,025
|
|
Year Ending December 31,
|
Scheduled Long-Term Debt Maturities
|
||
2020
|
$
|
33,387
|
|
2021
|
608,387
|
|
|
2022
|
33,387
|
|
|
2023
|
517,493
|
|
|
2024
|
575,000
|
|
|
Total
|
$
|
1,767,654
|
|
Lease Cost
|
Year Ended
December 31, 2019 |
||
Operating lease cost
|
$
|
23,087
|
|
Short-term lease cost
|
2,465
|
|
|
Variable lease cost
|
5
|
|
|
Sublease income
|
(634
|
)
|
|
Net lease cost
|
$
|
24,923
|
|
Leases
|
Classification
|
December 31,
2019 |
||
Assets
|
|
|
||
Operating lease assets
|
Operating lease assets
|
$
|
139,385
|
|
|
|
|
||
Liabilities
|
|
|
||
Current
|
|
|
||
Operating lease liabilities
|
Accrued liabilities
|
12,728
|
|
|
Non-current
|
|
|
||
Operating lease liabilities
|
Operating lease liabilities, less current portion
|
151,226
|
|
|
Total operating lease liabilities
|
|
$
|
163,954
|
|
Lease Term and Discount Rate
|
December 31,
2019 |
|
Weighted-average remaining lease term - operating leases (years)
|
9.7
|
|
Weighted-average discount rate - operating leases
|
5.3
|
%
|
|
Year Ended
December 31, 2019 |
||
Cash paid for amounts included in the measurement of lease liabilities:
|
|
||
Operating cash outflows from operating leases
|
$
|
17,066
|
|
Non-cash operating activities:
|
|
||
Right-of-use assets obtained in exchange for new operating lease liabilities (1)
|
$
|
153,448
|
|
(1)
|
Includes the balances recognized on January 1, 2019 on adoption of ASU No. 2016-02.
|
Year Ending December 31,
|
Operating leases
|
||
2020
|
$
|
21,315
|
|
2021
|
21,104
|
|
|
2022
|
21,139
|
|
|
2023
|
21,508
|
|
|
2024
|
23,857
|
|
|
Thereafter
|
104,655
|
|
|
Total lease payments
|
$
|
213,578
|
|
Less imputed interest
|
(49,624
|
)
|
|
Present value of lease liabilities
|
$
|
163,954
|
|
|
December 31,
|
||||
|
2019
|
|
2018
|
||
2011 Equity Incentive Plan
|
19,552
|
|
|
17,729
|
|
2007 Employee Stock Purchase Plan
|
1,883
|
|
|
1,126
|
|
Amended and Restated 2007 Non-Employee Directors Stock Award Plan
|
438
|
|
|
453
|
|
Amended and Restated Directors Deferred Compensation Plan
|
178
|
|
|
178
|
|
2007 Equity Incentive Plan
|
13
|
|
|
13
|
|
Total
|
22,064
|
|
|
19,499
|
|
|
Net Unrealized
Gain (Loss) From Hedging Activities |
|
Foreign
Currency Translation Adjustments |
|
Total
Accumulated Other Comprehensive Loss |
||||||
Balance at December 31, 2018
|
$
|
3,557
|
|
|
$
|
(201,348
|
)
|
|
$
|
(197,791
|
)
|
Other comprehensive loss before reclassifications
|
(3,903
|
)
|
|
(20,720
|
)
|
|
(24,623
|
)
|
|||
Amounts reclassified from accumulated other comprehensive loss
|
(979
|
)
|
|
—
|
|
|
(979
|
)
|
|||
Other comprehensive loss, net
|
(4,882
|
)
|
|
(20,720
|
)
|
|
(25,602
|
)
|
|||
Balance at December 31, 2019
|
$
|
(1,325
|
)
|
|
$
|
(222,068
|
)
|
|
$
|
(223,393
|
)
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Numerator:
|
|
|
|
|
|
||||||
Net income
|
$
|
523,367
|
|
|
$
|
447,098
|
|
|
$
|
487,848
|
|
Denominator:
|
|
|
|
|
|
||||||
Weighted-average ordinary shares used in per share calculations - basic
|
56,749
|
|
|
59,976
|
|
|
60,018
|
|
|||
Dilutive effect of employee equity incentive and purchase plans
|
801
|
|
|
1,245
|
|
|
1,299
|
|
|||
Weighted-average ordinary shares used in per share calculations - diluted
|
57,550
|
|
|
61,221
|
|
|
61,317
|
|
|||
|
|
|
|
|
|
||||||
Net income per ordinary share :
|
|
|
|
|
|
||||||
Basic
|
$
|
9.22
|
|
|
$
|
7.45
|
|
|
$
|
8.13
|
|
Diluted
|
$
|
9.09
|
|
|
$
|
7.30
|
|
|
$
|
7.96
|
|
|
Year Ended December 31,
|
|||||||
|
2019
|
|
2018
|
|
2017
|
|||
Exchangeable Senior Notes
|
5,504
|
|
|
5,504
|
|
|
3,805
|
|
Options, RSUs and ESPP
|
5,000
|
|
|
3,113
|
|
|
3,333
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Ireland
|
$
|
77,237
|
|
|
$
|
61,290
|
|
United States
|
171,079
|
|
|
126,941
|
|
||
Italy
|
12,959
|
|
|
8,760
|
|
||
Other
|
9,616
|
|
|
3,367
|
|
||
Total long-lived assets (1)
|
$
|
270,891
|
|
|
$
|
200,358
|
|
(1)
|
Long-lived assets consist of property, plant and equipment and operating lease assets.
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Xyrem
|
$
|
1,642,525
|
|
|
$
|
1,404,866
|
|
|
$
|
1,186,699
|
|
Erwinaze/Erwinase
|
177,465
|
|
|
174,739
|
|
|
197,340
|
|
|||
Defitelio/defibrotide
|
172,938
|
|
|
149,448
|
|
|
133,650
|
|
|||
Vyxeos
|
121,407
|
|
|
100,835
|
|
|
33,790
|
|
|||
Sunosi
|
3,714
|
|
|
—
|
|
|
—
|
|
|||
Other
|
17,552
|
|
|
39,585
|
|
|
49,920
|
|
|||
Product sales, net
|
2,135,601
|
|
|
1,869,473
|
|
|
1,601,399
|
|
|||
Royalties and contract revenues
|
26,160
|
|
|
21,449
|
|
|
17,294
|
|
|||
Total revenues
|
$
|
2,161,761
|
|
|
$
|
1,890,922
|
|
|
$
|
1,618,693
|
|
|
Year Ended December 31,
|
|||||||
|
2019
|
|
2018
|
|
2017
|
|||
ESSDS
|
76
|
%
|
|
74
|
%
|
|
73
|
%
|
McKesson
|
14
|
%
|
|
17
|
%
|
|
16
|
%
|
|
Contract Liabilities
|
||
Balance as of December 31, 2018
|
$
|
14,995
|
|
Amount recognized within royalties and contract revenues
|
(5,414
|
)
|
|
Balance as of December 31, 2019
|
$
|
9,581
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Grant date fair value
|
$
|
42.09
|
|
|
$
|
47.17
|
|
|
$
|
42.72
|
|
Volatility
|
32
|
%
|
|
35
|
%
|
|
35
|
%
|
|||
Expected term (years)
|
4.5
|
|
|
4.5
|
|
|
4.3
|
|
|||
Range of risk-free rates
|
1.3-2.5%
|
|
|
2.2-3.0%
|
|
|
1.6-2.1%
|
|
|||
Expected dividend yield
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Selling, general and administrative
|
$
|
78,697
|
|
|
$
|
76,770
|
|
|
$
|
83,218
|
|
Research and development
|
25,229
|
|
|
19,037
|
|
|
17,870
|
|
|||
Cost of product sales
|
6,637
|
|
|
6,634
|
|
|
5,812
|
|
|||
Total share-based compensation expense, pre-tax
|
110,563
|
|
|
102,441
|
|
|
106,900
|
|
|||
Income tax benefit from share-based compensation expense
|
(15,712
|
)
|
|
(17,230
|
)
|
|
(21,792
|
)
|
|||
Total share-based compensation expense, net of tax
|
$
|
94,851
|
|
|
$
|
85,211
|
|
|
$
|
85,108
|
|
|
Shares
Subject to
Outstanding
Options
(In thousands)
|
|
Weighted-
Average
Exercise
Price
|
|
Weighted-
Average
Remaining
Contractual
Term (Years)
|
|
Aggregate
Intrinsic
Value
(In thousands)
|
|||||
Outstanding at January 1, 2019
|
5,280
|
|
|
$
|
127.08
|
|
|
|
|
|
||
Options granted
|
1,691
|
|
|
138.14
|
|
|
|
|
|
|||
Options exercised
|
(515
|
)
|
|
90.27
|
|
|
|
|
|
|||
Options forfeited
|
(436
|
)
|
|
139.56
|
|
|
|
|
|
|||
Options expired
|
(186
|
)
|
|
159.59
|
|
|
|
|
|
|||
Outstanding at December 31, 2019
|
5,834
|
|
|
$
|
131.57
|
|
|
6.6
|
|
$
|
127,778
|
|
Vested and expected to vest at December 31, 2019
|
5,553
|
|
|
$
|
131.15
|
|
|
6.5
|
|
$
|
124,884
|
|
Exercisable at December 31, 2019
|
3,402
|
|
|
$
|
125.81
|
|
|
5.1
|
|
$
|
102,366
|
|
|
Number of RSUs (in thousands)
|
|
Weighted-
Average Grant-Date Fair Value |
|
Weighted-
Average Remaining Contractual Term (Years) |
|
Aggregate
Intrinsic Value (In thousands) |
|||||
Outstanding at January 1, 2019
|
1,102
|
|
|
$
|
142.13
|
|
|
|
|
|
||
RSUs granted
|
682
|
|
|
138.11
|
|
|
|
|
|
|||
RSUs released
|
(391
|
)
|
|
144.34
|
|
|
|
|
|
|||
RSUs forfeited
|
(212
|
)
|
|
140.76
|
|
|
|
|
|
|||
Outstanding at December 31, 2019
|
1,181
|
|
|
$
|
139.32
|
|
|
1.4
|
|
$
|
176,158
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Current
|
|
|
|
|
|
||||||
Ireland
|
$
|
51,696
|
|
|
$
|
33,431
|
|
|
$
|
28,045
|
|
United States
|
109,495
|
|
|
95,143
|
|
|
135,608
|
|
|||
Other
|
2,265
|
|
|
40,403
|
|
|
14,198
|
|
|||
Total current tax expense
|
163,456
|
|
|
168,977
|
|
|
177,851
|
|
|||
Deferred, exclusive of other components below
|
|
|
|
|
|
||||||
Ireland
|
(163,626
|
)
|
|
(12,408
|
)
|
|
(19,709
|
)
|
|||
United States
|
(41,297
|
)
|
|
(41,337
|
)
|
|
(27,559
|
)
|
|||
Other
|
(37,244
|
)
|
|
(34,545
|
)
|
|
(19,108
|
)
|
|||
Total deferred, exclusive of other components
|
(242,167
|
)
|
|
(88,290
|
)
|
|
(66,376
|
)
|
|||
Deferred, change in tax rates
|
|
|
|
|
|
||||||
United States
|
203
|
|
|
(538
|
)
|
|
(155,679
|
)
|
|||
Other
|
5,354
|
|
|
13
|
|
|
(3,536
|
)
|
|||
Total deferred, change in tax rates
|
5,557
|
|
|
(525
|
)
|
|
(159,215
|
)
|
|||
Total deferred tax benefit
|
(236,610
|
)
|
|
(88,815
|
)
|
|
(225,591
|
)
|
|||
Total income tax provision (benefit)
|
$
|
(73,154
|
)
|
|
$
|
80,162
|
|
|
$
|
(47,740
|
)
|
|
Year Ended December 31,
|
|||||||
|
2019
|
|
2018
|
|
2017
|
|||
Statutory income tax rate
|
12.5
|
%
|
|
12.5
|
%
|
|
12.5
|
%
|
Intra-entity transfer of intellectual property assets
|
(24.7
|
)%
|
|
—
|
%
|
|
—
|
%
|
Foreign income tax rate differential
|
8.7
|
%
|
|
11.9
|
%
|
|
20.3
|
%
|
Research and other tax credits
|
(8.7
|
)%
|
|
(3.0
|
)%
|
|
(2.6
|
)%
|
Patent box incentive benefit
|
(7.0
|
)%
|
|
—
|
%
|
|
—
|
%
|
Deduction on subsidiary equity
|
(5.2
|
)%
|
|
(0.5
|
)%
|
|
(0.7
|
)%
|
Change in valuation allowance
|
3.3
|
%
|
|
3.2
|
%
|
|
(2.8
|
)%
|
Non-deductible acquired IPR&D
|
2.5
|
%
|
|
—
|
%
|
|
—
|
%
|
Non-deductible compensation
|
1.8
|
%
|
|
1.2
|
%
|
|
2.6
|
%
|
Financing costs
|
(1.7
|
)%
|
|
(4.3
|
)%
|
|
(5.6
|
)%
|
Change in tax rate
|
1.5
|
%
|
|
(0.1
|
)%
|
|
(0.4
|
)%
|
Change in estimates
|
0.3
|
%
|
|
(1.1
|
)%
|
|
(2.1
|
)%
|
Change in unrecognized tax benefits
|
0.1
|
%
|
|
1.1
|
%
|
|
2.8
|
%
|
Excess tax benefits from share-based compensation
|
(0.1
|
)%
|
|
(0.4
|
)%
|
|
(1.5
|
)%
|
Non-deductible loss contingency
|
—
|
%
|
|
0.8
|
%
|
|
—
|
%
|
Impact of U.S. Tax Act
|
—
|
%
|
|
(1.4
|
)%
|
|
(33.7
|
)%
|
Investment in subsidiaries
|
—
|
%
|
|
(4.8
|
)%
|
|
—
|
%
|
Other
|
0.6
|
%
|
|
—
|
%
|
|
0.4
|
%
|
Effective income tax rate
|
(16.1
|
)%
|
|
15.1
|
%
|
|
(10.8
|
)%
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Deferred tax assets:
|
|
|
|
||||
Net operating loss carryforwards
|
$
|
90,670
|
|
|
$
|
106,128
|
|
Tax credit carryforwards
|
230,447
|
|
|
156,242
|
|
||
Intangible assets
|
154,844
|
|
|
23,469
|
|
||
Share-based compensation
|
26,091
|
|
|
24,592
|
|
||
Accruals
|
49,063
|
|
|
57,575
|
|
||
Indirect effects of unrecognized tax benefits
|
39,432
|
|
|
34,349
|
|
||
Investment in subsidiaries
|
—
|
|
|
25,585
|
|
||
Lease liabilities
|
33,847
|
|
|
—
|
|
||
Other
|
48,630
|
|
|
51,175
|
|
||
Total deferred tax assets
|
673,024
|
|
|
479,115
|
|
||
Valuation allowance
|
(66,307
|
)
|
|
(61,237
|
)
|
||
Net deferred tax assets
|
606,717
|
|
|
417,878
|
|
||
Deferred tax liabilities:
|
|
|
|
||||
Intangible assets
|
(537,520
|
)
|
|
(595,746
|
)
|
||
Operating lease assets
|
(28,442
|
)
|
|
—
|
|
||
Other
|
(43,447
|
)
|
|
(73,350
|
)
|
||
Total deferred tax liabilities
|
(609,409
|
)
|
|
(669,096
|
)
|
||
Net deferred tax liabilities
|
$
|
(2,692
|
)
|
|
$
|
(251,218
|
)
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Deferred tax assets
|
$
|
221,403
|
|
|
$
|
57,879
|
|
Deferred tax liabilities
|
(224,095
|
)
|
|
(309,097
|
)
|
||
Net deferred tax liabilities
|
$
|
(2,692
|
)
|
|
$
|
(251,218
|
)
|
|
December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Balance at the beginning of the year
|
$
|
118,213
|
|
|
$
|
106,162
|
|
|
$
|
90,910
|
|
Increases related to current year tax positions
|
27,552
|
|
|
22,649
|
|
|
27,875
|
|
|||
Increases related to prior year tax positions
|
761
|
|
|
7,584
|
|
|
1,620
|
|
|||
Decreases related to prior year tax positions
|
(91
|
)
|
|
—
|
|
|
(1,075
|
)
|
|||
Lapse of the applicable statute of limitations
|
(22,116
|
)
|
|
(18,182
|
)
|
|
(13,168
|
)
|
|||
Balance at the end of the year
|
$
|
124,319
|
|
|
$
|
118,213
|
|
|
$
|
106,162
|
|
|
2019
|
||||||||||||||
|
March 31
|
|
June 30
|
|
September 30
|
|
December 31
|
||||||||
Revenues
|
$
|
508,186
|
|
|
$
|
534,133
|
|
|
$
|
537,702
|
|
|
$
|
581,740
|
|
Gross margin (1)
|
469,825
|
|
|
495,747
|
|
|
500,921
|
|
|
541,178
|
|
||||
Net income
|
85,201
|
|
|
261,898
|
|
|
102,276
|
|
|
73,992
|
|
||||
Net income per ordinary share, basic
|
1.49
|
|
|
4.62
|
|
|
1.80
|
|
|
1.31
|
|
||||
Net income per ordinary share, diluted
|
1.47
|
|
|
4.56
|
|
|
1.78
|
|
|
1.29
|
|
|
2018
|
||||||||||||||
|
March 31
|
|
June 30
|
|
September 30
|
|
December 31
|
||||||||
Revenues
|
$
|
444,613
|
|
|
$
|
500,479
|
|
|
$
|
469,373
|
|
|
$
|
476,457
|
|
Gross margin (1)
|
406,928
|
|
|
461,381
|
|
|
438,623
|
|
|
440,997
|
|
||||
Net income
|
45,991
|
|
|
92,321
|
|
|
149,316
|
|
|
159,470
|
|
||||
Net income per ordinary share, basic
|
0.77
|
|
|
1.53
|
|
|
2.47
|
|
|
2.69
|
|
||||
Net income per ordinary share, diluted
|
0.75
|
|
|
1.50
|
|
|
2.41
|
|
|
2.64
|
|
(1)
|
Gross margin is computed by subtracting cost of product sales (excluding amortization of acquired developed technologies) from product sales, net.
|
•
|
Estimated loss contingency of $57.0 million in the first quarter of 2018;
|
•
|
Impairment charges and disposal costs of $44.0 million in the second quarter of 2018;
|
•
|
Upfront and milestone payments of $56.0 million and $48.3 million in the first and third quarters of 2019, respectively, and $11.0 million in the first quarter of 2018;
|
•
|
A one-time tax benefit of $112.3 million resulting from an intra-entity intellectual property asset transfer in the second quarter of 2019; and
|
•
|
Amortization costs of $111.1 million in the fourth quarter of 2019 in respect of the PRV.
|
|
|
|
Balance at
beginning
of period
|
|
Additions
charged to
costs and
expenses
|
|
Other Additions
|
|
Deductions
|
|
Balance at
end of
period
|
||||||||||
For the year ended December 31, 2019
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for doubtful accounts
|
(1)
|
|
$
|
50
|
|
|
$
|
9
|
|
|
$
|
—
|
|
|
$
|
(9
|
)
|
|
$
|
50
|
|
Allowance for sales discounts
|
(1)
|
|
76
|
|
|
782
|
|
|
—
|
|
|
(745
|
)
|
|
113
|
|
|||||
Allowance for chargebacks
|
(1)
|
|
408
|
|
|
41,864
|
|
|
—
|
|
|
(41,139
|
)
|
|
1,133
|
|
|||||
Deferred tax asset valuation allowance
|
(2)(3)(4)
|
|
61,237
|
|
|
20,086
|
|
|
357
|
|
|
(15,373
|
)
|
|
66,307
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
For the year ended December 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for doubtful accounts
|
(1)
|
|
$
|
396
|
|
|
$
|
20
|
|
|
$
|
—
|
|
|
$
|
(366
|
)
|
|
$
|
50
|
|
Allowance for sales discounts
|
(1)
|
|
103
|
|
|
811
|
|
|
—
|
|
|
(838
|
)
|
|
76
|
|
|||||
Allowance for chargebacks
|
(1)
|
|
3,663
|
|
|
41,387
|
|
|
—
|
|
|
(44,642
|
)
|
|
408
|
|
|||||
Deferred tax asset valuation allowance
|
(2)(3)
|
|
52,144
|
|
|
35,500
|
|
|
—
|
|
|
(26,407
|
)
|
|
61,237
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
For the year ended December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for doubtful accounts
|
(1)
|
|
$
|
287
|
|
|
$
|
231
|
|
|
$
|
—
|
|
|
$
|
(122
|
)
|
|
$
|
396
|
|
Allowance for sales discounts
|
(1)
|
|
118
|
|
|
1,087
|
|
|
—
|
|
|
(1,102
|
)
|
|
103
|
|
|||||
Allowance for chargebacks
|
(1)
|
|
4,749
|
|
|
41,941
|
|
|
—
|
|
|
(43,027
|
)
|
|
3,663
|
|
|||||
Deferred tax asset valuation allowance
|
(2)(3)(4)
|
|
53,184
|
|
|
7,509
|
|
|
5,581
|
|
|
(14,130
|
)
|
|
52,144
|
|
(1)
|
Shown as a reduction of accounts receivable. Charges related to sales discounts and chargebacks are reflected as a reduction of revenue.
|
(2)
|
Additions to the deferred tax asset valuation allowance charged to costs and expenses relate to movements on certain Irish, U.S. (federal and state) and other foreign deferred tax assets where we continue to maintain a valuation allowance until sufficient positive evidence exists to support reversal.
|
(3)
|
Deductions to the deferred tax asset valuation allowance include movements relating to utilization of NOLs and tax credit carryforwards, release in valuation allowance and other movements including adjustments following finalization of tax returns.
|
(4)
|
Other additions to the deferred tax asset valuation allowance relate to currency translation adjustments recorded directly in other comprehensive income and, in 2019, additions resulting from the Cavion asset acquisition.
|
•
|
amending the objects or memorandum of association of the Company;
|
•
|
amending the articles of association of the Company;
|
•
|
approving a change of name of the Company;
|
•
|
authorizing the entering into of a guarantee or provision of security in connection with a loan, quasi- loan or credit transaction to a director or a person who is deemed to be “connected” to a director for the purposes of the Companies Act;
|
•
|
opting out of preemption rights on the issuance of new shares;
|
•
|
re-registration of the Company from a public limited company to a private company;
|
•
|
variation of class rights attaching to classes of shares (where the articles of association do not provide otherwise);
|
•
|
purchase of the Company’s shares off market;
|
•
|
reduction of issued share capital;
|
•
|
sanctioning a compromise/scheme of arrangement with creditors or shareholders;
|
•
|
resolving that the Company be wound up by the Irish courts;
|
•
|
resolving in favor of a shareholders’ voluntary winding-up; and
|
•
|
setting the re-issue price of treasury shares.
|
•
|
a court-approved scheme of arrangement under the Companies Act. A scheme of arrangement with shareholders requires a court order from the Irish High Court and the approval of a majority in number representing 75% in value of the shareholders present and voting in person or by proxy at a meeting called to approve the scheme;
|
•
|
through a tender or takeover offer by a third party for all of the Company’s shares. Where the holders of 80% or more of the Company’s shares have accepted an offer for their shares, the remaining shareholders may also be statutorily required to transfer their shares, and if the bidder does not exercise its “squeeze out” right, then the non-accepting shareholders also have a statutory right to require the bidder to acquire their shares on the same terms. If the Company’s shares were to be listed on the main securities market of Euronext Dublin or another main securities market or regulated stock exchange in the European Union, this threshold would be increased to 90%; and
|
•
|
by way of a merger with an EU-incorporated company under the EU Cross-Border Mergers Directive 2005/56/EC. Such a merger must be approved by a special resolution.
|
•
|
any transfer of those shares or, in the case of unissued shares, any transfer of the right to be issued with shares and any issue of shares, shall be void;
|
•
|
no voting rights shall be exercisable in respect of those shares;
|
•
|
no further shares shall be issued in right of those shares or in pursuance of any offer made to the holder of those shares; and
|
•
|
no payment shall be made of any sums due from the Company on those shares, whether in respect of capital or otherwise.
|
•
|
in the event of an offer, all holders of securities of the target company must be afforded equivalent treatment and, if a person acquires control of a company, the other holders of securities must be protected;
|
•
|
the holders of securities in the target company must have sufficient time and information to enable them to reach a properly informed decision on the offer; where it advises the holders of securities, the board of directors of the target company must give its views on the effects of the implementation of the offer on employment, employment conditions and the locations of the target company’s place of business;
|
•
|
a target company’s board of directors must act in the interests of the company as a whole and must not deny the holders of securities the opportunity to decide on the merits of the offer;
|
•
|
false markets must not be created in the securities of the target company, the bidder or any other company concerned by the offer in such a way that the rise or fall of the prices of the securities becomes artificial and the normal functioning of the markets is distorted;
|
•
|
a bidder can only announce an offer after ensuring that he or she can pay in full the consideration offered, if such is offered, and after taking all reasonable measures to secure the implementation of any other type of consideration;
|
•
|
a target company may not be hindered in the conduct of its affairs longer than is reasonable by an offer for its securities (this is a recognition that an offer will disrupt the day-to-day running of a target company, particularly if the offer is hostile and the board of directors of the target company must direct its attention to resisting the offer); and
|
•
|
an acquisition of securities (whether such acquisition is to be effected by one transaction or a series of transactions) shall take place only at an acceptable speed and shall be subject to adequate and timely disclosure. Specifically, the acquisition of 10% or more of the issued voting shares within a seven day period that would take a shareholder’s holding to or above 15% of the issued voting shares (but less than 30%) is prohibited, subject to certain exemptions.
|
•
|
the action is approved by the Company’s shareholders at a general meeting; or
|
•
|
the Irish Takeover Panel has given its consent, where:
|
•
|
it is satisfied the action would not constitute frustrating action;
|
•
|
the Company’s shareholders holding more than 50% of the voting rights state in writing that they approve the proposed action and would vote in favor of it at a general meeting;
|
•
|
the action is taken in accordance with a contract entered into prior to the announcement of the offer (or any earlier time at which the Company’s board of directors considered the offer to be imminent); or
|
•
|
the decision to take such action was made before the announcement of the offer and either has been at least partially implemented or is in the ordinary course of business.
|
Execution Version
|
|
Exhibit 10.10
|
A.
|
Siegfried is engaged in the business of, among other things, providing development and/or manufacturing services with regard to drug substances and drug products for the pharmaceutical industry;
|
B.
|
Jazz is engaged in the business of, among other things, developing, producing, formulating, distributing and commercializing pharmaceutical products;
|
C.
|
Jazz desires to have Siegfried Manufacture and supply to Jazz Product (as defined herein) in commercial quantities; and
|
D.
|
Siegfried, subject to the terms and conditions of this Agreement, desires to Manufacture and supply Product to Jazz.
|
1.
|
Definitions
|
1.1
|
Active Pharmaceutical Ingredient/API shall mean the active pharmaceutical ingredient(s) set forth in Annex 1.1.
|
1.2
|
Affiliate shall mean with respect to any Party any person or entity Controlling, Controlled by, or under common Control with a Party at any time during the Term of this Agreement. For purposes of this definition, the term Control shall mean the power to direct or cause the direction of the management and policies of an entity, whether through the ownership of voting stock, by contract or otherwise. In the case of a corporation, the term Control shall mean the direct or indirect ownership of at least fifty per cent (50%) of the outstanding voting stock.
|
1.3
|
Agreement shall mean this Contract Manufacturing Agreement, including its Annexes (and appendices, if applicable), and including the Quality Agreement, in each case as may be amended from time to time according to the applicable terms and conditions of this Agreement or the Quality Agreement.
|
1.4
|
Alternative Manufacturer shall have the meaning as set out in Section 12.10.
|
1.5
|
API Manufacturing Site shall mean Siegfried’s facilities located at Untere Bruehlstrasse 4, 4800 Zofingen, Switzerland.
|
1.6
|
Applicable Laws shall mean all laws, rules and regulations applicable to the Manufacturing of API at the API Manufacturing Site or to the Manufacturing of Drug Product at the Drug Product Manufacturing Site, respectively, including without limitation the (i) U.S. Federal Food, Drug and Cosmetic Act, and all rules and regulations thereunder, (ii) EU Commission Directives 2001/83/EC as amended, and 2003/94/EC, and Directive 91/412/EEC, (iii) cGMP Regulations, and (iv) the counterparts to the foregoing in other jurisdictions, to the extent that Siegfried performs any Manufacturing in such jurisdiction.
|
1.7
|
Arising Intellectual Property Rights means all Intellectual Property Rights which are made, developed or reduced to practice by a Party in the performance of, or in connection with or related to, this Agreement.
|
1.8
|
Batch shall mean a specific quantity of Product or other Material that is intended to have uniform character and quality, within specified limits, and is produced during the same cycle of manufacture.
|
1.9
|
Business Day shall mean a day (not being a Saturday or Sunday) on which banks are open for business in Zurich, Switzerland, Hal-Far, Malta or Dublin, Ireland, as the context requires.
|
1.10
|
cGMP shall mean good manufacturing practices as described in regulations and guidance documents pertaining to manufacturing and quality control practice applicable for respective Product as may be further defined in the Quality Agreement.
|
1.11
|
Change shall mean any change to the Specifications, Master Batch Record, Raw Materials, Consigned Materials, Designated Vendor, API Manufacturing Site or the Drug Product Manufacturing Site, such Change being either (i) a Required Change (as
|
1.12
|
Chemistry, Manufacturing and Control/CMC shall mean the part of pharmaceutical development that deals with the nature of the API or Drug Product, respectively, the manner in which both are made, and the manner by which the manufacturing process is shown to be in control.
|
1.13
|
Confidential Information shall have the meaning as set out in Section 10.1.
|
1.14
|
Consigned Materials shall mean the materials that are owned by Jazz or that are to be provided by or on behalf of Jazz to Siegfried for the Manufacture of the API or Drug Product, respectively; including without limitation the Key Material and API (in accordance with Section 5.2).
|
1.15
|
Designated Vendor shall have the meaning as set out in Section 6.4.
|
1.16
|
Delivery Shortfall shall have the meaning as set out in Section 14.2.
|
1.17
|
Drug Product shall mean the drug product containing the API (film-coated tablets in bulk form), as set forth in Annex 1.2.
|
1.18
|
Drug Product Manufacturing Site shall mean Siegfried’s Affiliate (Siegfried Malta Limited) facilities located in HHF070 Hal Far Industrial Estate, Hal Far BBG 3000, Malta.
|
1.19
|
DEA shall mean the United States Drug Enforcement Administration or any successor entity thereto.
|
1.20
|
Effective Date shall have the meaning set forth on the front page of this Agreement.
|
1.21
|
EMA shall mean the European Medicines Agency or any successor entity thereto.
|
1.22
|
Entitled Person shall have the meaning as set out in Section 10.3.
|
1.23
|
Equipment means any equipment used in the Manufacture of a Product by Siegfried hereunder.
|
1.24
|
FDA shall mean the United States Food and Drug Administration or any successor entity thereto.
|
1.25
|
Forecast shall have the meaning as set out in Section 3.2.
|
1.26
|
Force Majeure Event shall have the meaning as set out in Section 16.3.
|
1.27
|
Hidden Defects shall mean a failure of Product to conform to the Specifications upon delivery, such failure not being discoverable by Jazz or its designee upon reasonable physical inspection upon receipt of the Product pursuant to Section 4.3.
|
1.28
|
Improvement shall mean any result, data, documentation, invention, improvement, innovation, development, discovery, computer program, device, trade secret, method, know-how, process, technique or the like, whether or not written or otherwise fixed in any form or medium, regardless of the media on which contained and whether or not patentable or copyrightable.
|
1.29
|
Initial Period shall have the meaning as set forth in Section 12.1.
|
1.30
|
Intellectual Property Rights shall mean, without limitation, all Improvements, inventions, patent applications, rights in patents, registered or unregistered design rights, copyrights, database rights, trademarks, trade names, know-how, trade secrets and other industrial or intellectual property rights of whatever kind.
|
1.31
|
Key Material shall mean the key starting material as set forth in Annex 1.3.
|
1.32
|
Losses shall mean all liabilities, claims, demands, actions, suits, losses, damages, costs and expenses (including reasonable attorney's fees) incurred by a Party.
|
1.33
|
Manufacture/Manufacturing/Manufactured shall mean all activities with respect to the manufacturing of the API or Drug Product, respectively, including, without limitation, the purchase of Raw Materials and primary packaging materials, production, quality control, quality assurance, release testing and stability testing, packaging and release of Product for shipment (but excluding, without limitation, (i) release of Drug Product for the market and (ii) shipment).
|
1.34
|
Manufacturing Site shall mean the API Manufacturing Site, the Drug Product Manufacturing Site, or both of them, as the case may be.
|
1.35
|
Marketing Authorization/MA shall mean the formal authorization (and associated documentation) granted or issued by a Regulatory Authority necessary for the lawful marketing and sale of the Drug Product in the respective country/countries of the Territory over which such Regulatory Authority has jurisdiction.
|
1.36
|
Master Batch Record shall mean the production Batch record for the Manufacture of the API or Drug Product, developed by Siegfried in part from the Technology, specifying the process, manufacture, deviations and testing of the API or Drug Product, respectively.
|
1.37
|
Materials shall mean Raw Materials and/or Consigned Materials.
|
1.38
|
Non-Conformance Claim shall have the meaning as set out in Section 4.3.
|
1.39
|
Order shall mean a purchase order issued by Jazz for a certain quantity of Product.
|
1.40
|
Order Confirmation shall mean a confirmation issued by Siegfried that an Order posted by Jazz shall be executed.
|
1.41
|
Party/Parties shall mean either Jazz or Siegfried, or both, as the context may require.
|
1.42
|
Pre-Existing Intellectual Property Rights of a Party means all Intellectual Property Rights owned, conceived, developed, first reduced to practice or otherwise made or acquired by such Party prior to the Effective Date hereof, including all modifications, adjustments or improvements thereto (to the extent such modifications, adjustments or improvements do not constitute any of the other Party’s Arising Intellectual Property Rights in accordance with Section 11.2 or Section 11.3, as the case may be).
|
1.43
|
Product/Products shall mean the API or the Drug Product or the two of them, as the context may require.
|
1.44
|
Quality Agreement shall mean the quality technical agreement between Jazz and Siegfried which defines the quality assurance responsibilities of each Party in respect of Product quality and compliance under cGMP Regulations, as may be amended from time to time.
|
1.45
|
Raw Materials shall mean all raw materials, excipients, and processing, filling and packaging components, which are not Product or Consigned Materials and which are necessary to manufacture the API or Drug Product, respectively, as set forth in the relevant Master Batch Record.
|
1.46
|
Recall shall have the meaning as set out in Section 7.6.
|
1.47
|
Regulatory Authority shall mean the governmental authority or authorities, which are responsible for approving the conduct of clinical trials, marketing and sale of pharmaceutical products and shall be EMA and FDA.
|
1.48
|
Specifications shall mean the description of technical requirements the API or Drug Product has to conform to, as set out in detail in the Quality Agreement.
|
1.49
|
Technology shall mean all information, Intellectual Property Rights and data in any form that Jazz has disclosed or will disclose, directly or indirectly, to Siegfried that may be necessary or useful for Manufacture of the API or Drug Product, respectively, as the same may be modified from time to time by Jazz in its sole discretion. All Technology shall constitute Confidential Information of Jazz, subject to Section 10.5.
|
1.50
|
Term shall have the meaning as set out in Section 12.2.
|
1.51
|
Territory shall mean the United States of America (with its territories, possessions, and protectorates, such as the Commonwealth of Puerto Rico), the member states of the European Union and/or European Economic Area (EU/EEA), Canada, United Kingdom (notwithstanding it being a member of the EU/EEA as of the Effective Date), Switzerland, Turkey, Australia, New Zealand, Brazil, Mexico, and any other country, which the Parties agree in writing to add to this definition of Territory in an amendment to this Agreement.
|
2.
|
Scope of Work
|
2.1
|
Appointment. Jazz hereby appoints Siegfried, and Siegfried accepts such appointment, to (i) Manufacture and supply the Drug Product for or on behalf of Jazz at the Drug Product Manufacturing Site, (ii) Manufacture and supply the API for or on behalf of Jazz at the API Manufacturing Site, whereas the API may be supplied to Jazz or may be used by Siegfried in the Manufacture of the Drug Product and (iii) act as a broker for the transport of the API (owned by Jazz) from the API Manufacturing Site to the Drug Product Manufacturing Site, subject to the terms and conditions set forth in this Agreement.
|
2.2
|
Siegfried Malta Limited. Siegfried has entered into this Agreement on behalf of itself and its Affiliate, Siegfried Malta Limited, through which Siegfried shall be performing certain activities hereunder. Siegfried shall procure that Siegfried Malta Limited shall be bound by the applicable terms and conditions of this Agreement as if it were a direct Party hereto and shall procure the due performance thereof by Siegfried Malta Limited. Jazz shall only be entitled to engage and communicate directly with Siegfried Malta Limited upon prior consent of Siegfried.
|
2.3
|
Purchase Commitment. Subject to Section 2.3, during the Term, Jazz (and any of its Affiliates, or any transferee or successor in interest to Jazz’s business or Product) shall order and purchase at least sixty percent (60%) of its requirements for the API and forty percent (40%) of its requirements for the Drug Product from Siegfried.
|
a)
|
For the API: [ * ]; or
|
b)
|
For the Drug Product: [ * ]:
|
c)
|
During the Term, but not more often than [ * ], upon reasonable prior written notice to Jazz and to such an extent as will not interfere with the normal operations of Jazz, an independent certified public accountant selected by Siegfried and reasonably acceptable to Jazz will have reasonable access during normal business hours to inspect, at Siegfried’s expense, Jazz’s books of accounts and other records pertaining to the purchase of API and Drug Product as may reasonably be necessary for the purpose of determining Jazz’s compliance with the minimum purchase commitment provided for under this Agreement. Prior to commencing any such inspection and/or audit, the accountant shall enter into a reasonable and customary confidentiality agreement with Jazz which prohibits the disclosure of any information, except as provided in said confidentiality agreement or pursuant to court order, relating to Jazz and/or its Affiliates to any person or entity, including Siegfried, except that such accountant may issue a report to Siegfried, which report shall also be provided to Jazz, the sole purpose of which will be to report to Siegfried on Jazz’s compliance or non-compliance with such minimum purchase commitment. Siegfried shall treat all information received from Jazz and/or its Affiliates and/or the accountant hereunder as Jazz’s Confidential Information. In the event of any dispute between Jazz and Siegfried regarding the findings of any such inspection or audit, the Parties shall initially attempt in good faith to resolve the dispute amicably between themselves. The costs for such an audit shall be borne by Jazz in case of the discovery of any inaccuracies resulting in non-compliance with Jazz’s minimum purchase commitment.
|
d)
|
In the event (i) Siegfried does not deliver conforming Product as per Sections 3.7 and 14.1 or (ii) Jazz notifies Siegfried in writing that Jazz has reasonable and material quality concerns regarding Siegfried’s Manufacture of the Product (including without limitation due to the occurrence of any major or critical deviations that have not been properly investigated by Siegfried (in Jazz’s reasonable discretion) or any material breach by Siegfried of its obligations under the Quality Agreement that remain uncured after [ * ] as per Section 12.4), the Parties agree that Jazz may, upon written notice to Siegfried, temporally purchase (i) more than forty-percent (40%) of its requirements of API and/or (ii) more than sixty-percent (60%) of its requirements of Drug Product from other suppliers without constituting a breach of its obligations under Section 2.3 and without any penalty, surcharge or Volume Shortfall payment being due or owing (pursuant to Section 2.3a) or 2.3b)). This Section 2.3 c) will apply only to the extent and for so long as Siegfried does not deliver conforming Product as per Sections 3.7 and 14.1 (excluding any Force
|
2.4
|
Exclusivity.
|
(i)
|
Product and/or
|
(ii)
|
any drug product containing the API
|
2.5
|
Controlled Substance. The Parties acknowledge that the API (and thus the Drug Product) may become scheduled under the Federal Controlled Substances Act and/or respective laws in other countries of the Territory (collectively, the FCSA). Jazz shall promptly inform Siegfried if the API will be subject to the FCSA, and the Parties will confer and discuss in good faith the necessary activities to be taken as needed to comply with the FCSA, and the allocation of costs therefore, including without limitation, amending this Agreement and obtaining the necessary licenses, authorizations and regulatory requirements.
|
2.6
|
Relationship Management. Upon execution of this Agreement, each Party shall forthwith appoint one of its employees to be a relationship manager responsible for liaison
|
2.7
|
Information. Jazz shall provide to Siegfried the Technology and such other information in Jazz's possession relating to the Products, which are useful and necessary for Siegfried in performing its obligations hereunder, in particular any information concerning any potential hazards involved in Manufacturing Product and other Safety, Health and Environment (SHE) requirements related to the handling of the Product or any waste. The Technology provided by Jazz to Siegfried hereunder shall be subject to the terms and conditions set forth in Sections 10 and 11.
|
3.
|
Ordering, Purchase and Supply of Product
|
3.1
|
Jazz shall submit to Siegfried, upon [ * ] and then [ * ], an estimated (good faith) demand forecast of Jazz’s requirements of each Product for the next [ * ].
|
3.2
|
Jazz shall submit to Siegfried, on a [ * ] basis, [ * ] prior to the beginning of each month, an estimated (good faith) demand forecast of Jazz’s requirements of each Product for the next [ * ], as follows (each, a “Forecast”):
|
3.2.1
|
Drug Product Forecast: Jazz’s [ * ] forecast for Drug Product shall set forth:
|
3.2.2
|
The total lead-time for Manufacture of Drug Product shall be [ * ], provided sufficient quantity of API is available to Drug Product Manufacturing Site at least [ * ] prior to the confirmed delivery date.
|
3.2.3
|
API Forecast: Jazz’s [ * ] forecast for API shall set forth:
|
3.2.4
|
The total lead-time for Manufacture of API shall be [ * ], provided sufficient quantity of Key Material is available to Siegfried at least [ * ] prior to the confirmed delivery date. In case (i) the Key Material is not available to Siegfried in sufficient quantity at least [ * ] prior to the confirmed delivery date or (ii) the API ordered by Jazz was not reflected in the [ * ] forecast, the Parties shall jointly agree on the lead time.
|
3.3
|
Siegfried shall use commercially reasonable efforts to supply Jazz, no later than [ * ], with a written summary report of the agreed Consigned Materials, API and Drug Product inventory for such prior month in the form used by Siegfried for its customers, in order that Jazz may properly account for the inventory held by Siegfried (and its Affiliates) pursuant to this Agreement. The Parties may agree that additional specialized reports shall be prepared by Siegfried in accordance with Jazz's reasonable instructions. The costs for such additional reports will be borne by Jazz.
|
3.4
|
Jazz acknowledges that Siegfried will rely on the accuracy of Jazz’s Forecasts in planning its Manufacture, storage and transport of Product as well as its acquisitions of Raw Materials, as set forth in Section 5. If at any time Jazz finds that a Forecast is inaccurate in a material respect, Jazz shall inform Siegfried without delay and the Parties shall confer and discuss without delay how to proceed.
|
3.5
|
Jazz shall make all purchases of Product hereunder by submitting Orders to Siegfried in accordance with the respective Product Forecast. Each such Order shall be in writing and shall specify (i) the Product ordered, (ii) the quantity ordered), (iii) the price pursuant to Annex 1.4, and (iv) the requested delivery date, giving Siegfried no less than the number of days in advance of requested delivery to Jazz pursuant to Section 3.2 (the Lead Time). Lead Times for Product deliveries for validation campaigns and/or initial requirements of Product for launch in a country of the Territory shall be agreed upon between the Parties in good faith.
|
3.6
|
In accordance with Section 3.2.3 or 3.2.4, Siegfried shall use commercially reasonable efforts to execute Orders which exceed by [ * ] of the forecasted quantities. Orders exceeding [ * ] of the forecasted quantities shall be discussed between the Parties, but are only binding upon confirmation by Siegfried. Subject to this Section 3, Siegfried shall confirm to Jazz by way of an Order Confirmation that it will meet Jazz’s quantity requirements in accordance with the delivery date(s) within [ * ] from the date of
|
3.7
|
Siegfried shall promptly and without undue delay notify Jazz in writing of any anticipated delay or of any circumstance rendering it unable to Manufacture and/or supply Product in accordance with the delivery date(s) and the estimated duration of such delay/circumstance(s). Upon such written notice, the Parties will work together to agree upon a revised delivery schedule and the Parties shall proceed in accordance with Section 14.1.
|
3.8
|
The Product shall be delivered from Siegfried to Jazz [ * ] (Incoterms 2010) API Manufacturing Site or Drug Product Manufacturing Site, and at the price as set out in Annex 1.4. To clarify, Jazz assumes all responsibilities and liability arising out of the shipment, transport, storage, handling and use of the Product after delivery by Siegfried to Jazz in accordance with the agreed [ * ] Incoterms.
|
4.
|
Product Delivery and Conformance
|
4.1
|
Jazz shall procure the pick-up and shipment of the Product at the agreed delivery date. A storage fee shall apply for Product which is not picked-up and shipped at that agreed delivery date through no fault of Siegfried or upon mutual agreement and thus stored by or on behalf of Siegfried for more than [ * ] from the agreed delivery date, such storage fee shall be [ * ]. Upon prior written notice to Jazz, Siegfried shall have the right to ship Product that have been stored more than [ * ] from the agreed delivery date to Jazz or its designee.
|
4.2
|
Siegfried will provide to Jazz the documentation set forth in the Quality Agreement with each shipment of Product. Siegfried acknowledges that Jazz will rely on the accuracy and completeness of such documentation in its determination of conformance of Product with Specifications, cGMP, the Quality Agreement and Applicable Law.
|
4.3
|
Upon delivery of Product to Jazz (or its designee), Jazz shall carry out a reasonable physical inspection, or shall procure a designee to carry out a reasonable physical inspection, of the Product within [ * ] in order to determine compliance with the Specifications, the Quality Agreement, Applicable Law and cGMP at the time of delivery and all stages of Manufacture prior thereto. If, in either Party's opinion or determination, any Product Manufactured does not comply with the Specifications, the Quality Agreement, Applicable Law or cGMP upon delivery or at any stage of Manufacture prior thereto, then such Party shall promptly notify the other Party in writing thereof (which may include email notification) (Non-Conformance Claim). If Jazz does not notify Siegfried within [ * ] after delivery of the Product, then the Product is deemed accepted, provided that Jazz retains the right to reject the Product at a later time in the case of Hidden Defects as set out in Section 4.4.
|
4.4
|
Jazz retains the right to reject Product for a period of [ * ] after delivery to Jazz (or its designee) in case of Hidden Defects (which may include, without limitation, a Hidden Defect caused by or arising due to a material error in the documentation supplied by Siegfried under Section 4.2), provided that Jazz notifies Siegfried in writing within [ * ] of discovering the Hidden Defect.
|
4.5
|
Any Non-Conformance Claim made by Jazz shall specify in reasonable detail the nature and basis for the claim and cite Siegfried’s relevant Batch numbers or other information to enable specific identification of the Product involved. Siegfried shall review any Non-Conformance Claim made by Jazz and provide Jazz with the results of such (interim) review without undue delay and, in any event, within [ * ] of receipt of Jazz’s Non-Conformance Claim, as set forth in the Quality Agreement. If such review by Siegfried confirms that the identified Product did not comply with the Specifications, Applicable Law, the Quality Agreement or cGMP upon delivery or at any stage of Manufacture, then Jazz shall have the right to reject such Product and the Parties shall proceed according to Section 14.1. The nonconforming Product shall be disposed or delivered, at Siegfried’s expense, to such destination as agreed by the Parties, in compliance with applicable environmental laws and regulations. Neither Party shall use or dispose of Product that does not, or of which either Party claims that it does not, conform to the Specifications, the Quality Agreement, Applicable Law and cGMP upon delivery or at any stage of Manufacture thereof, without the other Party's prior written consent.
|
4.6
|
Any Non-Conformance Claim made by Siegfried shall specify in reasonable detail the nature and basis for the claim and cite Siegfried’s relevant Batch numbers or other information to enable specific identification of the Product involved. Jazz shall review any Non-Conformance Claim made by Siegfried and provide Siegfried with the results of such review within [ * ] of receipt of Siegfried’s Non-Conformance Claim. If such review by Jazz confirms that the identified Product did not comply with the Specifications, Applicable Law, the Quality Agreement or cGMP upon delivery or at any stage of Manufacture, then Siegfried shall have the right to reject such Product and the Parties shall proceed according to Section 14.1. The nonconforming Product shall be disposed or delivered, at Siegfried’s expense, to such destination as agreed by the Parties, in compliance with applicable environmental laws and regulations. Neither Party shall use or dispose of Product that does not, or of which either Party claims that it does not, conform to the Specifications, the Quality Agreement, Applicable Law and cGMP upon delivery or at any stage of Manufacture thereof, without the other Party's prior written consent.
|
4.7
|
If the Parties fail to agree as to whether a quantity of Product conforms to the Specifications, Applicable Law, the Quality Agreement or cGMP upon delivery or at any stage of Manufacture, the Parties shall have the Batch in dispute and/or relevant data or information investigated, tested and/or further analyzed by an independent testing laboratory or consultant (if the Parties mutually agree to refer to a consultant) selected by agreement between the Parties. The decision of the independent testing laboratory or
|
5.
|
Purchase, Storage and Transport of Materials
|
5.1
|
In accordance with Jazz’s Forecast and Orders placed, Siegfried will obtain sufficient quantities of all Raw Materials at Siegfried’s costs and expenses in sufficient quantities and of good quality as necessary to enable Siegfried to Manufacture and supply Product in accordance with Jazz’s requirements. Jazz shall also bear the mutually agreed costs of all material to be used as reference standards or impurity standards in the Manufacture of Products, unless otherwise mutually agreed in writing.
|
5.2
|
Jazz shall obtain all right, title and interest in and to the API upon release by Siegfried, whereupon such (released) API becomes Consigned Materials. Jazz shall cause that the Key Material will be supplied in good quality as necessary to enable Siegfried to Manufacture Product in accordance with Jazz’s Forecast and Orders (see i.a. Section 3.2.4 above), at Jazz’s costs and expenses. Any import duties, taxes or other fees due to governmental authorities regarding Consigned Materials shall be paid by Jazz.
|
5.3
|
Jazz shall solely and exclusively retain all right, title and interest in and to all Consigned Material released by Siegfried and Jazz shall insure such Consigned Material against loss and damage. Siegfried shall be liable for any loss of or damage to such Consigned Material, including destruction and shipping costs, if such loss or damage was caused by Siegfried’s gross negligence or willful misconduct.
|
5.4
|
Any inventory level of Key Material and Consigned Materials (particularly of consigned API) shall only be established upon mutual agreement and at Jazz’s reasonable cost and expenses. Siegfried shall adopt appropriate warehousing controls to rotate Consigned Materials stock as mutually agreed (based on the First-In/First-Out (FiFo) principle unless otherwise agreed in writing), unless otherwise instructed by Jazz and agreed by Siegfried.
|
5.5
|
Siegfried agrees that, without prior written consent by Jazz, Consigned Materials shall: (i) be used solely for the purpose of the Manufacture and supply of Product; (ii) be used in compliance with all Applicable Laws; and (iii) not be transferred to any third party, except to any Affiliate or subcontractor of Siegfried as agreed in the Quality Agreement or otherwise in writing with Jazz (and Siegfried remains fully and directly responsible for the acts and omissions of such Affiliate or subcontractor, as if performed by Siegfried), unless otherwise agreed by the Parties in writing.
|
5.6
|
Until otherwise notified by Jazz to Siegfried with at least [ * ] prior notice or otherwise agreed by the Parties in writing, Siegfried shall act as a broker with regard to the transport of API owned by Jazz (Consigned Material) from the API Manufacturing Site to the Drug Product Manufacturing Site, at Jazz’s reasonable and prior-agreed cost and expenses, and Siegfried shall appoint a qualified and approved subcontractor, as specified in the Quality Agreement and Jazz may monitor and approve Siegfried’s shipping and freight practices as may be agreed in the Quality Agreement or otherwise in writing between the Parties. Siegfried shall only be responsible for the acts and omissions of all such logistics providers, if due Siegfried’s gross negligence or willful misconduct.
|
5.7
|
Jazz agrees to reimburse Siegfried all reasonable cost and expenses incurred for the amount of inventory of Materials required to be written off as a result of Jazz requiring a change of Materials, in particular, without limitation, changes to specification or vendors, provided however, that Siegfried shall use commercially reasonable efforts to limit such loss of Materials.
|
5.8
|
Upon reasonable request of Jazz or expiration or termination of the Agreement, Siegfried will make such Consigned Materials available for collection by or on behalf of Jazz in good and usable condition and Jazz will pick-up such Consigned Materials within [ * ], at Jazz’s cost and expenses.
|
6.
|
Manufacture of Product
|
6.1
|
The terms of the Quality Agreement shall be deemed incorporated by reference into this Agreement.
|
6.2
|
Siegfried shall maintain the Manufacturing Sites and Equipment in a state of repair and operating efficiency consistent with the requirements of the Applicable Laws, cGMP, Specifications, the Quality Agreement, and Master Batch Record. Further details with regard to the Manufacturing Site shall be set forth in the Quality Agreement.
|
6.3
|
Siegfried shall obtain sufficient quantities of all Raw Materials to Manufacture and supply Product in accordance with Jazz’s Forecast and shall ensure that such Raw Materials comply with the Specifications. Jazz shall reimburse Siegfried all costs and expenses reasonably incurred as a result of a change in the Specifications of such Raw Materials.
|
6.4
|
If Jazz, in its sole discretion, designates certain Raw Material or any other vendors, other than Siegfried or its Affiliates (each a Designated Vendor), then Siegfried shall obtain respective Raw Material(s) only from such Designated Vendors. Jazz shall reimburse Siegfried all costs and expenses reasonably incurred as a result from appointing or changing a Designated Vendor. Siegfried shall not be liable or responsible for any acts or omissions of such Designated Vendor, including without limitation, a delayed delivery, delivery of non-conforming Raw Material or other supply failure (unless and to the extent any such acts or omissions of such Designated Vendor arise as a result of Siegfried’s negligence or wilful misconduct or any breach by Siegfried of its obligations hereunder).
|
6.5
|
In the event that either Party becomes aware and notifies the other Party that any Change is mandated by Applicable Laws (including, without limitation cGMP Regulations) or by a competent Regulatory Authority (Required Change), then Siegfried shall promptly (i) advise Jazz as to any quality assurance effect scheduling and, if applicable, Product price adjustments, which may reasonably and necessarily result therefrom, and (ii) make any necessary Required Change. Prior to implementation of such Required Change, the Parties shall negotiate in good faith on: (a) the allocation of the implementation costs with regard to the Product and any other products, (b) if applicable, the new Product price after the Required Change has been implemented; and (c) any other amendments to this Agreement which may be necessitated by such Required Change; provided always that all costs associated with Required Changes directly related to the Manufacturing Site that are not required solely to permit Siegfried to Manufacture the Product, or a group of products including the Product, shall be borne by Siegfried. Siegfried and Jazz shall cooperate in making any Required Changes and use commercially reasonable efforts to implement any Required Changes promptly in a manner that minimizes any effect on the supply hereunder to Jazz of the Product meeting Specifications.
|
6.6
|
In the event Jazz wishes to effect a Change which is not a Required Change (Customer Change), Jazz shall advise Siegfried in writing of such Customer Change as set forth in the Quality Agreement. If Siegfried (acting reasonably and promptly) deems, in its reasonable discretion, such Customer Change as implementable, then Siegfried shall provide (a) if applicable, an estimate of all reasonable, necessary and vouched implementation costs to be borne by Jazz, (b) if applicable, the new proposed Product price after the Customer Change has been implemented (if necessitated by such Customer Change), (c) the timing for implementation and (d) if applicable, an estimated amount of any Raw Materials rendered obsolete as a result of the Customer Change and respective costs to be borne by Jazz. Subject to Jazz’s approval, Siegfried shall implement such Customer Change. Jazz shall bear the approved implementation costs (which include the costs for the Raw Materials rendered obsolete) and the new Product Price, if applicable, shall apply after the implementation.
|
6.7
|
In the event Siegfried wishes to effect a Change which is not a Required Change (Siegfried Change), Siegfried shall advise Jazz in writing of such Siegfried Change as
|
7.
|
Audits, Notification and Recall
|
7.1
|
Jazz has the right to carry out audits as set forth in the Quality Agreement. While on the Manufacturing Site, Jazz shall comply with all of Siegfried’s applicable policies regarding, safety, health, data protection, confidentiality and the like which Siegfried, in its sole discretion, deems relevant.
|
7.2
|
Siegfried shall provide Jazz and its designees with reasonable access to its Manufacturing Site and the areas in which Materials or Product is Manufactured, stored, handled or shipped, and Jazz and its designees shall be permitted to review Siegfried’s standard operating procedures related to Manufacture, storage, handling, general facilities, equipment and procedures required for compliance with cGMP.
|
7.3
|
Siegfried will use commercially reasonable efforts to obtain the right for Jazz to have similar audit rights for Siegfried’s subcontractors, as set forth in the Quality Agreement.
|
7.4
|
Siegfried shall permit any Regulatory Authority to inspect relevant facilities, Equipment and records (including those of its Affiliates) at their request and shall resolve, and procure the resolution by its Affiliates, of all issues raised by a Regulatory Authority, if and to the extent such issues are relevant for the Manufacture of the Product or other cGMP-related obligations under this Agreement.
|
7.5
|
Each Party shall notify the other Party promptly of any serious or unexpected adverse reaction from the use of the Drug Product, which is reported to it or of which it becomes aware otherwise.
|
7.6
|
In the event either Party believes it may be necessary to conduct a recall or other similar action with respect to the Drug Product (each a Recall), the Parties shall consult with each other as to how best to proceed. If Siegfried reasonably requests a Recall and Jazz declines to act accordingly, Siegfried shall not be liable for any consequences or damages thereafter. Under no circumstances shall Siegfried be prohibited hereunder from taking any action that it is required to take by applicable law.
|
7.7
|
This Section applies to Affiliates of Siegfried and Siegfried shall procure the adherence of its Affiliates hereto and Jazz’s right of audit thereof.
|
8.
|
Compensation and Terms of Payment
|
8.1
|
In consideration for the services under the terms of this Agreement, Jazz shall pay Siegfried the prices as specified in, and in accordance with the payment terms set forth in, Annex 1.4.
|
8.2
|
All pricing, payments, credits, allowances or other monetary adjustments under this Agreement shall be in [ * ], as agreed between the Parties and set forth in the Annex 1.4.
|
8.3
|
The Parties may adjust prices upon mutual agreement based on (i) Raw Material price changes, (ii) indices, (iii) exchange rate variations as set forth in the Annex 1.4 or as otherwise agreed in writing.
|
8.4
|
Invoices shall be issued by Siegfried and sent to Jazz upon release of the Product.
|
8.5
|
Jazz shall pay such invoices to Siegfried within [ * ] after the date of receipt of such invoice. Each invoice shall, to the extent applicable, identify the Jazz Order number, Product quantities, unit price, freight charges and the total amount to be remitted by Jazz. Notwithstanding the foregoing, Jazz may withhold any amounts invoiced by Siegfried that it disputes in good faith and in writing prior to such [ * ] after the date of receipt of the respective invoice. If Jazz disputes any invoice, Jazz shall within [ * ] after such invoice is furnished to it notify Siegfried in writing that it disputes the accuracy or appropriateness of such invoice and specify the particular respects in which such invoice is inaccurate or inappropriate. The Parties will make good faith efforts to resolve any disputes within [ * ] thereafter. Any amounts that are disputed by Jazz and which the Parties determine are due following resolution of such dispute shall not be due until [ * ] following such resolution.
|
8.6
|
In the event any undisputed sum is not paid when due, then Jazz shall pay interest at a rate of [ * ] on the amount of such undisputed late sum (from the original due date until the date such undisputed late sum is paid).
|
9.
|
Regulatory Affairs
|
9.1
|
Jazz shall be responsible for all regulatory filings in connection with the Product.
|
9.2
|
All information, documents and updates with regard to the Manufacture of Product which are in the possession of Siegfried and required by any Regulatory Authority shall, as reasonably requested by Jazz in connection with a submission for such regulatory filings, be as is provided by Siegfried to Jazz, free of charge.
|
9.3
|
Siegfried shall further provide Jazz, at Jazz’s costs and expenses, with reasonable assistance in preparing or reviewing the regulatory filing or formulating responses to any questions and/or inquiries (i.e., deficiency letters) with respect to the above submissions.
|
9.4
|
Jazz shall provide, and Siegfried shall review, the CMC and other portions of Jazz’s proposed regulatory filings relating to Siegfried’s Manufacturing procedures or otherwise related to Siegfried’s key obligations hereunder before the regulatory filings are submitted with relevant Regulatory Authorities and Jazz shall consider Siegfried’s comments thereto in good faith.
|
9.5
|
The Parties acknowledge that the ultimate decision of whether any Drug Product will be approved for marketing and sale rests with the Regulatory Authorities of the respective market in the Territory and that Siegfried shall not be liable for the failure of the Regulatory Authorities to issue such Marketing Authorization approval other than due to Siegfried’s gross negligence or willful misconduct or material breach of any of its obligations, warranties or undertakings hereunder.
|
9.6
|
The Parties acknowledge that the Manufacturing Site and/or the Drug Product Manufacturing Site has the required certifications from the Regulatory Authorities (the FDA, the EMA), which currently allows the Product distribution also in Canada and Australia by GMP certificates mutual recognition. In case a Product launch in other specific countries of Territory would require additional certifications, Parties will discuss in good faith and agree in prior on the plausibility, and costs and timelines associated.
|
10.
|
Confidential Information
|
10.1
|
Confidential Information shall mean any information of whatever kind (including without limitation, data, compilations, formulae, models, patent disclosures, procedures, processes, projections, protocols, results of experimentation and testing, specifications, strategies and techniques), and all tangible and intangible embodiments and oral disclosures thereof of any kind whatsoever, (including without limitation, samples, apparatus, compositions, documents, drawings, machinery, patent applications, records and reports), which has been or will be disclosed by or on behalf of one Party (Disclosing Party) to the other Party (Receiving Party) in connection with this Agreement, and which is confidential or proprietary to the Disclosing Party or an Affiliate thereof, including, without limitation, any and all information pertaining to the Products and information which relates to the business of either Party, including business plans, strategies, operations, policies, procedures, pricing, techniques, accounts, marketing plans, financial plans and status, and personnel of either Party; provided that such information was designated in writing as "Confidential" or "Proprietary" information at the time of the initial disclosure or by confirmation in writing to the Receiving Party within [ * ] of the initial disclosure and further provided always that, notwithstanding the foregoing, information shall be subject to the obligations set forth herein and constitute Confidential Information, even if not identified or marked as confidential or proprietary, if the Receiving Party knows, or in the exercise of reasonable business
|
10.2
|
Each Receiving Party agrees to retain in strict confidence any Confidential Information of the Disclosing Party (or its Affiliates or contractors), whether disclosed prior to, or after the Effective Date and not to use any such Confidential Information for any purpose except pursuant to, and in order to carry out, the terms and objectives of this Agreement, and not to disclose, divulge or otherwise communicate any such Confidential Information to any third party.
|
10.3
|
The Receiving Party may disclose Confidential Information of the Disclosing Party to its Affiliates or its (or its Affiliate's) officers, directors, employees, agents, consultants, licensees, subcontractors or representatives (each an Entitled Person), who, in each case, (i) need to know such information for purposes of the implementation and performance by the Receiving Party of this Agreement, and (ii) are subject to confidentiality and non-use restrictions covering the Confidential Information that are at least as stringent at those contained herein, provided that the Receiving Party shall, nevertheless, remain fully liable for any breach by any of its Entitled Persons of their confidentiality obligations in respect of the Confidential Information.
|
10.4
|
Each Party agrees to use with respect to Confidential Information of the other Party at least the same standard of care as it uses to protect proprietary or confidential information of its own of comparable sensitivity and to exercise every reasonable precaution to prevent and restrain the unauthorized disclosure of such Confidential Information by any of its Entitled Persons.
|
10.5
|
The provisions of Section 10.1 shall not apply to any Confidential Information disclosed hereunder which (a) was independently developed or independently known by the Receiving Party prior to its disclosure to the Receiving Party by the Disclosing Party, as evidenced by written or electronic records; or (b) was before or after the date of such disclosure in the public domain or lawfully disclosed to the Receiving Party by an independent, unaffiliated third party rightfully in possession of the Confidential Information and not under any confidentiality obligation with regard to such Confidential Information; or (c) is required to be disclosed by the Receiving Party to the officials of a Regulatory Authority or to comply with applicable laws, to defend or prosecute litigation or to comply with Applicable Law, judicial orders or valid subpoenas, provided that the Receiving Party provides prior written notice of such intended disclosure to the Disclosing Party and takes reasonable and lawful actions to avoid and/or minimize the degree of such disclosure. The burden of proof of the foregoing exceptions shall lie with the Receiving Party. Specific information disclosed as part of the Confidential Information shall not be deemed to be in the public domain or in prior possession of the Receiving Party merely because it is included in more general information in the public domain or in the prior possession of the Receiving Party.
|
10.6
|
Except as otherwise expressly stated under this Agreement, nothing herein shall be construed as giving either Party any right, title or interest in or ownership of the Confidential Information of the other Party.
|
10.7
|
Except as may be required by law or regulation (including securities law and related filings), or in response to a valid subpoena or other judicial order, neither Party shall disclose the terms of this Agreement without the prior written consent of the other Party, which consent shall not be unreasonably withheld, except that the Parties may disclose the terms of this Agreement to the Parties' or third parties' accountants and attorneys, provided any such attorney or accountant receiving information concerning the terms of this Agreement is either bound by professional secrecy or agrees to be bound by confidentiality obligations equal to this Section 10 with respect to such information.
|
10.8
|
The Parties acknowledge that any breach of this Section 10 may constitute irreparable harm, and that the non-breaching Party shall be entitled to seek specific performance or injunctive relief to enforce this Section 10 in addition to whatever remedies such Party may otherwise be entitled to at law.
|
10.9
|
Upon termination or expiration of this Agreement (in whole or in part), each Party shall immediately deliver to the other (and cause any of its Entitled Persons to so deliver), at such Party’s expense, all Confidential Information of the other Party (in the case of partial termination, that relates to the Terminated Product), including without limitation any and all copies, duplications, summaries and/or notes thereof or derived thereof, regardless of the format, and all remaining samples of Product (or, in the case of partial termination, Terminated Product), provided however, that both Parties may keep (i) such original documents, copies and samples as required by law or (ii) one set of such information in its legal files or archives for the sole purpose of monitoring its compliance with its obligations hereunder and neither Party shall be required to delete copies made in routine back up of its information technology systems (if access to such material is limited to members of such Party’s information technology department only). Any information retained by a Party pursuant to this Section 10.9 shall be subject to the confidentiality obligations set forth herein.
|
11.
|
Intellectual Property
|
11.1
|
Siegfried acknowledges that Jazz Confidential Information and Jazz’s Pre-Existing Intellectual Property Rights provided to, utilized or observed by Siegfried pursuant to this Agreement shall be and remain the sole and exclusive property of Jazz. Likewise, Jazz acknowledges that Siegfried Confidential Information and Siegfried’s Pre-Existing Intellectual Property Rights utilized by Siegfried pursuant to this Agreement shall be and remain the sole and exclusive property of Siegfried.
|
11.2
|
All rights, title, and interest in and to any Arising Intellectual Property Rights shall be the sole and exclusive property of Jazz to the extent any such Arising Intellectual Property Rights (i) incorporate, (ii) are derived from or (iii) relate to any of Jazz’s Pre-Existing
|
11.3
|
Jazz agrees that, as between Siegfried and Jazz, Siegfried shall own all Arising Intellectual Property Rights of a general nature generated or derived by Siegfried in the course of performing its obligations hereunder which (i) do not incorporate, (ii) are not derived from, (iii) are not specific to or dependent upon and (iv) do not relate in any way, either directly or indirectly, in whole or in part, to (a) Jazz’s Pre-Existing Intellectual Property Rights, (b) Jazz Arising Intellectual Property Rights, (c) Jazz Confidential Information and/or (d) Jazz Product(s) (Siegfried Arising Intellectual Property Rights) and Jazz hereby assigns, and transfers to Siegfried its entire right, title and interest in and to any and all Siegfried Arising Intellectual Property Rights. Siegfried hereby grants Jazz a non-exclusive, worldwide, irrevocable, transferable, royalty-free license to use such Siegfried Arising Intellectual Property Rights to the extent that, and limited to, the development, manufacturing, sale, commercialization or any other use of the Product is dependent upon such license.
|
11.4
|
In the event of patent infringement or regulatory litigation or other legal proceedings, involving the Product, Siegfried shall have the right to suspend further supply of the Product to the extent this is required by a court order or arbitral award or order (whether interim or final). Such suspension shall be deemed a temporary suspension of Siegfried’s supply obligations under this Agreement; provided, that if such suspension continues for more than [ * ], the Parties shall jointly attempt in good faith to modify this Agreement to resolve the situation but if they are unable to do so within the following [ * ] either Party may terminate this Agreement by notice to the other Party.
|
12.
|
Term and Termination
|
12.1
|
This Agreement shall become effective on the Effective Date and, unless earlier terminated in accordance with this Section 12 or other applicable term of this Agreement, shall continue in full force and effect until December 31, 2024 (Initial Period).
|
12.2
|
Unless earlier terminated in accordance with any applicable term of this Agreement, this Agreement shall automatically renew for consecutive periods of one (1) year each unless one of the Parties notifies the other of its election not to renew the Agreement, either in whole or in part, at least eighteen (18) months prior to the end of the Initial Period or the renewal term then in effect, in which case this Agreement shall terminate, either in whole or in part (as the case may be), upon the expiration of such term (Term).
|
12.3
|
Either Party may terminate the Agreement immediately, by providing written notice to the other Party following the occurrence of any of the following events:
|
(a)
|
the liquidation or dissolution of the other Party, or the commencement of insolvency procedures or any proceeding under any bankruptcy, insolvency or moratorium law, or any other law or laws for the relief of debtors which proceeding is not dismissed within [ * ], or the appointment of any receiver, trustee or assignee to take possession of the properties of the other Party;
|
(b)
|
the sale, lease or other disposition of at least seventy-five percent (75%) of the other Party’s business or assets, to a person other than an Affiliate of such Party; or
|
(c)
|
the cessation of all or substantially all of the other Party’s business operations.
|
12.4
|
If a Party breaches a material term or condition of this Agreement, the non-breaching Party shall have the right to terminate this Agreement, either in whole or in part, after [ * ] prior written notice to the other Party unless any such breach is cured within said [ * ]. Termination shall be in addition to all other rights and remedies available to the non-breaching Party at law or in equity.
|
12.5
|
This Agreement may be terminated, in whole or in part, by [ * ] written notice given by Jazz to Siegfried, as follows:
|
(a)
|
If any required license, permit or certificate of Siegfried is not approved or not issued, or is withdrawn or suspended, by any Regulatory Authority; or
|
(b)
|
If Drug Product is withdrawn or deleted by any Regulatory Authority so that there are no remaining markets available;
|
(c)
|
If Jazz decides to permanently cease the commercialisation of Product.
|
12.6
|
This Agreement may be terminated, in whole or in part, by [ * ] written notice given by Siegfried to Jazz, as follows:
|
(a)
|
If Jazz does not commercially launch any Drug Product within [ * ] after receipt of approval from any Regulatory Authority;
|
(b)
|
If Jazz ceases commercial sale of Drug Product after commercial launch; or
|
(c)
|
If Jazz does not purchase at least the total volume of Drug Product that requires Siegfried to Manufacture [ * ] of API during any [ * ] period after commercial launch of the Drug Product.
|
12.7
|
Any and all references to termination of this Agreement “in part” or “partial termination” throughout this Agreement shall mean that the applicable Party may, subject to and in accordance with the provisions of this Agreement, terminate this Agreement solely in respect of the Manufacture and supply of either (i) the API or (ii) the Drug Product (hereinafter referred to as the “Terminated Product”), in which case:
|
(a)
|
the Agreement shall be terminated solely in respect of the Terminated Product;
|
(b)
|
the Agreement shall continue in full force and effect in respect of the other non-terminated Product(s) (the “Non-Terminated Product”);
|
(c)
|
the provisions of the Agreement (including, without limitation, all applicable references to “Product”) shall be construed accordingly; and
|
(d)
|
for the avoidance of doubt, the terms of Section 2.3 shall apply accordingly solely in respect of the Non-Terminated Product and Jazz shall have no further obligations pursuant thereto in respect of the Terminated Product.
|
12.8
|
Upon expiration or termination of this Agreement, in whole or in part, Siegfried shall have the right to deliver to Jazz (and Jazz shall have the obligation to take delivery of) all Product (or, in the case of partial termination, all Terminated Product) already Manufactured by Siegfried pursuant to any Order and the remaining Materials that relate to the Terminated Product maintained by Siegfried pursuant to Section 5 and Jazz shall pay the price for such Products or Terminated Product (as the case may be) or Materials, provided however, that Siegfried uses commercially reasonable efforts to limit such loss of Materials.
|
12.9
|
Neither the expiration nor the termination of this Agreement, in whole or in part, shall relieve the Parties of their obligations (in the case of partial termination, as they relate to the Terminated Product) incurred prior to such expiration or termination. All provisions that, by their express or implied terms, are meant to survive termination of the Agreement, in particular all rights and obligations set forth in Sections 8 (Compensation and Terms of Payment), 10 (Confidential Information), 11 (Intellectual Property), 14.1 (Liability and Indemnity), 16 (Miscellaneous) and 17 (Applicable Law and Dispute Resolution) shall continue irrespective of such termination.
|
12.10
|
At all times during the Term, Jazz shall have the right to make Product and to have Product made by an Affiliate or third party manufacturer (Alternative Manufacturer) on its behalf, subject to the terms and conditions of this Agreement, including, without limitation Sections 2.3 (Purchase Commitment), 10 (Confidentiality), and 11 (Intellectual Property). Prior to appointing such an Alternative Manufacturer, Jazz and Siegfried shall, without delay, confer and discuss in good faith if and how any Affiliate of Siegfried may be appointed as alternative manufacturing site.
|
12.11
|
In the event Jazz intends to engage an Alternative Manufacturer at any time (including during the Term or upon termination of this Agreement in whole or in part), Siegfried shall, at the request of Jazz and subject to Jazz’s reasonable cooperation, provide documents already prepared by Siegfried as may be necessary or helpful for the technology transfer of the manufacturing process for Product and the regulatory qualification to Jazz or the Alternative Manufacturer (including all know-how necessary or reasonably useful to enable Jazz or the Alternative Manufacturer to manufacture Product), provided that Siegfried will not be required to (i) prepare, translate or otherwise generate documents, unless otherwise agreed by Siegfried (acting reasonably ) and at Jazz’ reasonable costs and expenses, (ii) provide Siegfried Confidential Information, or (ii) grant licenses to Siegfried Pre-Existing Intellectual Property Rights or Siegfried Arising Intellectual Property Rights to a third party Alternative Manufacturer.
|
12.12
|
In the event of transfer to Jazz or its Affiliate, at the request of Jazz and subject to Jazz’s reasonable cooperation, the Parties shall confer and discuss a technology transfer plan prepared by Jazz and agreed by Siegfried (such agreement not to be unreasonably withheld, conditioned or delayed), including applicable fees (Jazz Technology Transfer Plan). Such Jazz Technology Transfer Plan may, as applicable, provide for reasonable technical assistance regarding the manufacture, testing and supply of Product, including access to technical personnel, as may be helpful for Jazz or its Affiliate to implement such process to manufacture Product. Subject to Siegfried’s approval and consent of the scope of the Jazz Technology Transfer Plan and cost and expenses therefore (such approval and consent not to be unreasonably withheld, conditioned or delayed), Siegfried shall implement the Jazz Technology Transfer Plan and Jazz shall reimburse Siegfried for all reasonable costs and expenses incurred by Siegfried to conduct such technology transfer and technical assistance, unless otherwise mutually agreed in writing.
|
13.
|
Representations and Warranties
|
13.1
|
Each Party represents and warrants to the other Party (i) that it has the legal power, authority and right to enter into this Agreement and to perform its respective obligations set forth herein, (ii) that this Agreement has been duly executed and delivered by each Party and constitutes the valid and binding obligation of such Party, enforceable against such Party in accordance with its terms, and (iii) the execution, delivery and performance by such Party of this Agreement and its compliance with the terms hereof does not and will not conflict with or result in a breach of any term of, or constitute a
|
13.2
|
Siegfried represents, warrants and covenants to Jazz that all Product Manufactured pursuant to this Agreement shall conform with Specifications, Applicable Law and the Master Batch Record upon delivery and all Product has been Manufactured in accordance with cGMP and the material provisions of the Quality Agreement.
|
13.3
|
Jazz represents, warrants and covenants that the Technology and the Consigned Materials provided to Siegfried by or on behalf of Jazz hereunder, and used by Siegfried for the performance of its obligations in accordance with the terms of this Agreement and Jazz’s instructions, does not infringe or misappropriate and, to the best of Jazz’ knowledge, will not infringe or misappropriate the Intellectual Property Rights of any third party.
|
13.4
|
EXCEPT AS EXPRESSLY WARRANTED IN THIS AGREEMENT, NEITHER PARTY EXTENDS ANY OTHER WARRANTIES OR REPRESENTATIONS COVERING THE PRODUCT OR THE TECHNOLOGY, EXPRESS OR IMPLIED, AND EACH PARTY EXPRESSLY DISCLAIMS ALL IMPLIED WARRANTIES, INCLUDING THE WARRANTY OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. EACH PARTY’S LIABILITY UNDER THESE WARRANTY PROVISIONS SHALL BE STRICTLY LIMITED TO THE REMEDIES PROVIDED FOR UNDER THIS AGREEMENT.
|
14.
|
Liability and Indemnity
|
14.1
|
If Siegfried is unable to meet the delivery dates or other agreed time lines regarding the delivery of Product, or in case Product does not comply with Specifications, Applicable Law, cGMP or the Quality Agreement upon delivery and is rejected by Jazz (acting reasonably) in accordance with Section 4, Siegfried shall promptly, at Jazz’s election: (i) for delayed delivery, use all commercially reasonable efforts to deliver the delayed Product as soon as possible after the original delivery date (or such later date as may be agreed by Jazz, acting reasonably), at no additional cost to Jazz and Siegfried shall bear the reasonable and documented transport costs for expedited delivery; (ii) for non-conforming Product, (a) replace any rightfully rejected Product with conforming Product as soon as possible (or such later date as may be as agreed by Jazz, acting reasonably) at no additional cost to Jazz or, if delivery of conforming Product is not possible within reasonable additional time, Siegfried shall refund to or credit Jazz all amounts paid by Jazz to Siegfried for such rightfully rejected Product, and (b) Siegfried shall bear the reasonable and documented transport, packaging, and destruction costs for such non-conforming Product. As agreed by the parties pursuant to Section 2.3, and upon Jazz’ written notification as per Section 2.3, Jazz may temporally purchase (i) more than forty-percent (40%) of its requirements of API and/or (ii) more than sixty-percent (60%) of its requirements of Drug Product from other suppliers without constituting a breach of its
|
14.2
|
If Siegfried fails to deliver conforming Drug Product within a grace period of [ * ] after the original delivery date on [ * ] consecutive occasions within [ * ] (excluding, without limitation, due to any Force Majeure Event or any reason caused due to an act or omission of Jazz) (Delivery Shortfall), Jazz shall be entitled to terminate this Agreement, either in whole or in part, upon [ * ] written notice to Siegfried.
|
14.3
|
Siegfried shall indemnify, defend and hold Jazz, its directors, officers, employees and Affiliates, harmless against all Losses arising out of or in connection with third party claims, suits, actions, demands or judgments to the extent arising out of (i) the breach of any of Siegfried's obligations, warranties or representations under this Agreement, except to the extent such Losses are caused by Jazz’s negligence or willful misconduct.
|
14.4
|
Jazz shall indemnify, defend and hold Siegfried, its directors, officers, employees and Affiliates harmless against all Losses, arising out of or in connection with third party claims, suits, actions, demands or judgments to the extent arising out of (i) the breach of any of Jazz's obligations, warranties or representations under this Agreement, of (ii) the death of or injury to any person or any damage to property caused by Jazz’ commercialization or use of Product except to the extent such Losses are caused by Siegfried's negligence or willful misconduct.
|
14.5
|
With respect to any indemnification obligation under this Agreement, the following conditions shall be applicable:
|
(a)
|
The Party seeking to be indemnified shall notify the indemnifying Party promptly in writing of any claim which may give rise to an obligation on the part of the indemnifying Party hereunder; and
|
(b)
|
the indemnifying Party shall be allowed to timely take the sole control of the defense of any such action and claim, including all negotiations for the settlement, or compromise of such claim or action at its sole expense; and
|
(c)
|
the Party to be indemnified shall, at the expense of the indemnifying Party, render reasonable assistance, information, co-operation and authority to permit the indemnifying Party to defend such action; and
|
(d)
|
no settlement or compromise shall be binding on a Party hereto without its prior written consent, which consent shall not be unreasonably withheld, conditioned or delayed.
|
14.6
|
During the Term of this Agreement, Siegfried and Jazz shall each obtain and carry in full force and effect adequate commercial, general liability insurance as common in the industry, including product liability insurance, which shall protect the Parties with respect to liability claims covered by Sections 14.3 and 14.4. Such insurance shall be written by a reputable insurance company and shall be endorsed to include product liability coverage. A Party shall provide another Party on request with a copy of certificates of insurance evidencing the same.
|
14.7
|
NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR SPECIAL, PUNITIVE, INCIDENTAL, INDIRECT (EXCEPT WITH RESPECT TO THE INDEMNIFICATION AGAINST CLAIMS OF THIRD PARTIES UNDER SECTION 14), OR CONSEQUENTIAL DAMAGES OF THE OTHER PARTY OR ANY THIRD PARTY, INCLUDING BUT NOT LIMITED TO CLAIMS BASED ON LOST PROFITS, LOSS OF TIME, LOSS OF OPPORTUNITY OR ANY OTHER ECONOMIC LOSS SUFFERED OR INCURRED AS A RESULT OF THIS AGREEMENT.
|
14.8
|
WITH THE EXCEPTION OF ANY LIABILITY ARISING DUE TO GROSS NEGLIGENCE, FRAUD, WILFUL MISCONDUCT OR BREACH OF SECTION 10 (CONFIDENTIAL INFORMATION) OR SECTION 11 (INTELLECTUAL PROPERTY) HEREOF, AND IF AND TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH PARTY'S MAXIMUM LIABILITY UNDER THIS AGREEMENT SHALL BE LIMITED TO [ * ].
|
15.
|
Anti-Bribery and Anti-Corruption
|
15.1
|
Each Party shall comply fully at all times with all applicable laws and regulations, including without limitation any applicable anti-corruption laws, regulations and standards, of the territories in which Jazz or Siegfried, respectively, conduct business or activities hereunder or which are relevant to the operation of this Agreement (including but not limited to the U.S. Foreign Corrupt Practices Act and the U.K. Bribery Act 2010) (collectively, the Anti-Corruption Laws). Each Party will ensure that its personnel have read, understood and shall comply with the Anti-Corruption Laws.
|
15.2
|
Each Party shall at all times comply with their respective code of conducts. Any non-compliance of the Anti-Corruption Laws or otherwise relevant in connection with this Agreement shall be reported to the other Party without any delay. Siegfried acknowledges that Jazz’s Code of Conduct is available online at www.jazzpharmaceuticals.com or will be handed out as a hard copy upon request. Jazz acknowledges that Siegfried’s Code of Business Conduct is available online at www.siegfried.ch or will be handed out as a hard copy upon request.
|
15.3
|
Without limiting its obligations under Sections 15.1 and 15.2, each Party agrees that it has not, and covenants that it will not, in connection with the performance of this Agreement, promise, authorize, ratify or offer to make, or take any act in furtherance of any payment or transfer of anything of value, directly or indirectly: (i) to any individual
|
15.4
|
Without limiting its obligations under Sections 15.1 and 15.2, each Party agrees and covenants that no payments or transfers of value shall be made, promised, authorized, ratified or offered with the purpose or effect of public or commercial bribery, acceptance of or acquiescence in extortion, kickbacks or other unlawful or improper means of securing an improper advantage or obtaining or retaining business.
|
15.5
|
Each Party agrees and covenants that it has not permitted and will not permit anyone acting on its behalf to violate the Anti-Corruption Laws.
|
16.
|
Miscellaneous
|
16.1
|
No set-off. Neither Party shall be entitled to set off any of its rights or obligations under this Agreement against the rights or obligations of another Party without having first obtained the prior written consent of that other Party.
|
16.2
|
Sub-contracting. Other than laboratory services as is necessary, Siegfried shall not be permitted to subcontract Manufacturing under this Agreement to any third party (other than certain activities hereunder to Siegfried Malta), without Jazz’s prior written consent. If a subcontractor is appointed by Siegfried, Siegfried shall be responsible for all work performed by, and all acts, omissions and breaches of, such subcontractor as if performed or made by itself.
|
16.3
|
Force Majeure. A Party shall be excused from performing its obligations under this Agreement (other than obligations of payment) to the extent that its performance is delayed or prevented by any cause beyond such Party’s reasonable control, including, but not limited to, act of God (such as extreme weather), fire, (naturally caused) flood, explosion, disease, war, insurrection, civil strike, riots, government action power failure or energy shortages (Force Majeure Event). Performance shall be excused only to the extent of and during the reasonable continuance of such disability. Any deadline or time for performance specified in this Agreement that falls due during or subsequent to the occurrence of any of the disabilities referred to herein shall be automatically extended for a period of time equal to the period of such disability. The prevented Party shall immediately notify the other Party if, by reason of any Force Majeure Event, the prevented Party is unable to meet any deadline or time for performance specified in this Agreement. In the event that such Force Majeure Event cannot be removed or
|
16.4
|
Precedence of Agreement. Unless expressly agreed otherwise in writing, the terms outlined in this Agreement shall prevail over any terms and conditions outlined in any Order or Order Confirmation for Product and any general terms and conditions of a Party, and such terms and conditions are hereby expressly excluded. In case of discrepancies between this Agreement and an Annex hereto, the provisions of this Agreement shall prevail.
|
16.5
|
No assignment. This Agreement is binding upon and shall inure to the benefit of the Parties hereto and their successors and permitted assigns. This Agreement and any rights or obligations hereunder may be assigned or delegated only (i) with the consent of the other Party, not to be unreasonably withheld, conditioned or delayed, or (ii) by Jazz to its Affiliates or to the successor to all or substantially all of the business of Jazz (whether by merger, consolidation, asset transfer or similar transaction) to which this Agreement relates. Any other assignment or delegation by either Party without the prior written consent of the other Party is void.
|
16.6
|
No waiver. The failure by either Party at any time to enforce any of the terms, provisions or conditions of this Agreement or to exercise any right hereunder shall not constitute or be construed to constitute a waiver of the same or affect that Party's rights thereafter to enforce or exercise the same.
|
16.7
|
Independent Parties. Nothing in this Agreement shall be deemed or construed to constitute or create between the Parties hereto a partnership, joint venture, agency, or other relationship other than as expressly set forth herein. Neither Party shall have authority to speak for, represent or obligate the other Party in any way without prior written consent of the other Party.
|
16.8
|
Entire Agreement. This Agreement (together with the Quality Agreement) contains the full understanding of the Parties with respect to the subject matter hereof and supersedes all prior understandings and writings relating thereto (other than, for the avoidance of doubt, the Master Development Services Agreement and any Confidential Disclosure Agreement executed by the Parties and/or their Affiliates, each of which shall remain in full force and effect in accordance with its respective terms). No waiver, alteration or modification of any of the provisions hereof shall be binding unless made in writing and signed by the Parties.
|
16.9
|
Severability. If any portion of this Agreement is held invalid by a court of competent jurisdiction, such portion shall be deemed to be of no force and effect and this Agreement shall be construed as if such portion had not been included herein, provided
|
16.10
|
Notices. Any notice required under this Agreement shall be effective only if it is in writing and (i) delivered in person or (ii) deposited with a nationally recognized overnight courier service, or (iii) sent by registered mail or (iv) dispatched by e-mail (pdf), in which case such notice is to be confirmed by registered mail within [ * ]; in either case any notice is to be addressed to the applicable address set forth below or any other address as designated by either Party.
|
|
if to Siegfried
|
Siegfried AG
Untere Brühlstrasse 4, 4800 Zofingen, Switzerland Attention: [ * ] Email: [ * ] |
|
with a copy to:
|
|
|
if to Jazz:
|
Jazz Pharmaceuticals Ireland Limited
Waterloo Exchange, Waterloo Road, Dublin 4, Ireland Attention: Legal Department Fax/e-mail: [ * ] |
16.11
|
Compliance with Laws. Each Party shall comply with all Applicable Law governing its performance of the terms of this Agreement, including, but not limited to, those relating to health, safety and the environment, fair labor practices, unlawful discrimination, debarment, supply chain transparency and modern slavery, anti-corruption and anti-bribery laws.
|
16.12
|
Hardship. If during the Term of this Agreement, the performance of the Agreement should lead to unreasonable hardship for the one or the other Party, both Parties shall undertake reasonable endeavors to discuss in good faith a possible amicable resolution or possible amendment to this Agreement in light of the change in circumstances; provided always, however, that (i) neither Party shall have any obligation to amend this Agreement or to waive or modify any of its rights under this Agreement and (ii)
|
17.
|
Applicable Law and Dispute Resolution
|
17.1
|
This Agreement shall be governed by German laws without regard to its conflict of laws provisions and the provisions of the UN Convention regarding Contracts on the International Sale of Goods (Vienna Convention).
|
17.2
|
All disputes arising out of or in connection with this Agreement, including disputes on its conclusion, binding effect, amendment or termination, shall be resolved exclusively by arbitration in accordance with the Arbitration Rules of the German Arbitration Institute (DIS) in force on the date on which the Notice of Arbitration is submitted in accordance with these Rules, agree as follows:
|
a)
|
The number of arbitrators shall be three (3).
|
b)
|
The seat of the arbitration shall be Hannover, Germany.
|
c)
|
The arbitral proceedings shall be conducted in English.
|
17.3
|
Notwithstanding any other provision of this Agreement, each Party shall still be entitled to access the courts in Hannover, Germany, to obtain appropriate injunctive relief.
|
Annex
|
Description
|
Content
|
1.1
|
API
|
Description of API
|
1.2
|
Drug Product
|
Description of Drug Product
|
1.3
|
Key Material
|
Description of Key Material
|
1.4
|
Commercial Terms
|
Price, MOQ and other commercial terms
|
Siegfried AG
|
|
|
|
|
|
|
|
/s/ Luca Parlanti
|
/s/ Marco Henneböhle
|
|
|
Name / function
|
Name / function
|
|
|
Dr. Luca Parlanti
|
Dr. Marco Henneböhle
|
|
|
Head of Exclusive Sales
|
Director Business Development
|
|
|
Drug Substance
|
Exclusive Synthesis Europe
|
|
|
Siegfried AG
|
Siegfried AG
|
|
|
|
|
|
|
|
|
|
|
Jazz Pharmaceuticals Ireland Limited
|
|
|
|
|
|
|
|
/s/ Kathleen Gibbons
|
|
|
|
Name / function
|
|
|
|
|
|
|
|
Kathleen Gibbons
|
|
|
|
VP, Finance
|
|
|
THIS AGREEMENT is made on
|
05
|
Oct 2019
|
|
|
|
BETWEEN
|
|
|
(1)
|
JAZZ PHARMACEUTICALS IRELAND LIMITED a company incorporated under the laws of Ireland having its registered office at Fifth Floor, Waterloo Exchange, Waterloo Road, Dublin 4 ( the “Company”);
|
(2)
|
PAUL TREACY of Ireland (the “Employee”).
|
A.
|
The Employee is presently employed by the Company on the terms and the conditions set out in a contract of employment dated 10 June 2014, executed by the Employee on 23 June 2014, and amended by letter dated 8 December 2014 (the “Employment Contract”).
|
B.
|
It is agreed that the three-month notice of termination of the Employee’s employment pursuant to clause 15 of the Employment Contract shall officially begin as of 1 October 2019 (the “Notice Effective Date”).
|
C.
|
The Company is entering into this Agreement for itself and on behalf of each of its Associated Undertakings.
|
1.
|
Termination of employment; Transition Assistance.
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1.1
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The Employee’s employment with the Company shall terminate on 31 December 2019 (the “Termination Date”). Prior to the Notice Effective Date, the Employee will reasonably cooperate with the Company and provide full transition assistance with respect to his role, duties and projects, including, but not limited to, working closely with Daniel Swisher on preparing and implementing a mutually acceptable communication plan regarding his departure (including internal and external communications), and the transition plan for his responsibilities and relationships.
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1.2
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Save as set out in this Agreement, the Employee’s entitlement to salary and all other benefits associated with his employment by the Company shall continue until the Termination Date when they shall cease.
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1.3
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By reason of the termination of his employment, the Employee is entitled to receive the following payments:
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1.3.1
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salary and contractual benefits up to and including the Termination Date; and
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1.3.2
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payment in lieu of outstanding annual leave accrued by the Employee, but not taken at the Termination Date.
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1.4
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The payments specified in clause 1.3 shall be paid in the ordinary course via Company payroll and shall be subject to such income tax, PRSI and USC and other deductions as the Company is required (or permitted) to deduct from the gross amount and remit to the Irish Revenue Commissioners and/or any other tax or, governmental or, fiscal authority (“Revenue”) under the relevant tax and social welfare (or equivalent) legislation.
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2.
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Garden Leave
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2.1
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Between the Notice Effective Date and the Termination Date, the Employee shall be on paid garden leave. During the garden leave period, the Company shall not be obliged to provide the Employee with any work or assign to him any powers, duties or functions (and shall be entitled to appoint the Employee’s successor). Save as agreed or requested by the Company, during the garden leave period the Employee: shall be removed from his position and not undertake any job duties; shall not enter any premises of the Company or any Associated Undertaking; and shall not engage in any contact (whether or not initiated by him), other than social contact, with any customer, client, supplier, consultant or agent of the Company or any Associated Undertaking.
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2.2
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For the avoidance of doubt, during the garden leave period the Employee shall continue to be bound by the duties of fidelity and good faith and shall comply with any and all relevant obligations under the Employment Contract or implied by common law (including but not limited to the duties of confidentiality and trust and confidence).
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2.3
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During the garden leave period, the Company may require the Employee to undertake at his home or at the premises of the Company or any Associated Undertaking or at such place reasonably nominated by the Company such reasonable duties as the Company may at its discretion assign to him and to provide any reasonable assistance requested by the Company or any Associated Undertaking. In particular, the Employee shall be required to provide full transition assistance to the Company including (but not limited to) assistance with regard to a mutually acceptable communication plan regarding his departure, and the transition of his responsibilities and relationships. The Employee shall hold himself available and remain contactable during normal business hours (other than agreed holidays or authorised sickness) to perform any such duties or provide any such assistance and shall ensure that the Company has up to date contact details for him.
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3.
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Consideration, settlement, release and discharge
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3.1
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As compensation for the Employee’s loss of employment, and subject to compliance by the Employee with his obligations under this Agreement, including providing the transition assistance discussed in clause 1.1 and signing and returning the Supplemental Waiver of Claims referred to in clause 9 (below), the Company shall make an ex gratia payment (the “Termination Payment”) to the Employee by no later than the Payment Date (defined below) consisting of the following amounts: (a) 2019 bonus in the amount of €180,000; (b) 2020 bonus in the amount of €180,000; (c) twenty-four (24) months of basic salary in the amount of €800,000; and (d) an amount equivalent to twenty-four (24) months of the Employee’s regular monthly employee benefits in effect as of the Termination Date.
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3.2
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The Termination Payment shall be in full and final settlement, release and discharge of any and all actions or causes of actions, claims, complaints, contracts, liabilities and agreements (if any) as the Employee has or may have against the Company and/or any Associated Undertaking, and its or their employees, officers, shareholders and agents, whether arising under Statute, common law, contract, tort (including claims for personal injuries), equity or otherwise arising out of his employment and/or the termination of such employment.
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3.3
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For the purposes of this Agreement, the expression ‘Statute’ shall include, but not be limited to the following:
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•
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the Redundancy Payments Acts 1967- 2014;
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•
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the Terms of Employment (Information) Acts 1994 - 2014;
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•
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the Minimum Notice and Terms of Employment Acts 1973 - 2005;
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•
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the Protection of Employment Act 1977 - 2014;
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•
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the Protection of Employment (Exceptional Collective Redundancies and Related Matters) Act 2007;
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•
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the Organisation of Working Time Act 1997;
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•
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the Payment of Wages Act 1991;
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•
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the Unfair Dismissals Acts 1977 - 2015;
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•
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the Protected Disclosures Act 2014;
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•
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the Employment Equality Acts 1998 - 2015;
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•
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the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003;
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•
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the Maternity Protection Acts 1994 and 2004;
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•
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the Adoptive Leave Acts 1995 and 2005;
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•
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the Parental Leave Acts 1998 and 2006;
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•
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the Paternity Leave and Benefit Act 2016;
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•
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the National Minimum Wage Acts 2000 and 2015;
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•
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the Carer’s Leave Act 2001 (as amended);
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•
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the Protection of Employees (Part-Time Work) Act 2001;
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•
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the Protection of Employees (Fixed-Term Work) Act 2003;
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•
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the Industrial Relations Acts, 1946 - 2015;
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•
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the Data Protection Acts 1988 - 2018;
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•
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the Workplace Relations Act 2015;
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•
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the Employment (Miscellaneous Provisions) Act 2018; and
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•
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the Safety Health and Welfare at Work Act 2005 - 2014.
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3.4
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For the purposes of clause 3.1, the “Payment Date” shall mean the date which is 30 days after the date on which the Company receives from the Employee a duly executed copy of the Supplemental Waiver of Claims (provided that the Employee signs and returns this Agreement by no later than 4 October 2019).
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3.5
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The Employee acknowledges that the payment to him of the Termination Payment is made without any admission of any liability or breach of statute or law by the Company or of any duty or obligation owed to him by the Company.
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3.6
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Subject to the Employee’s signature of the Form of letter attached at Appendix 1 in a form satisfactory to the Company, the Termination Payment will be made in the most tax efficient manner permitted by law provided that this does not result in any additional cost or liability whatsoever to the Company and, subject thereto, the Termination Payment shall be subject to such income tax, PRSI, USC and other deductions as the Company is required to deduct from the gross amount and remit to Revenue under the relevant tax and social welfare legislation.
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3.7
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The Employee hereby agrees to indemnify and hold harmless the Company and any Associated Undertaking in full (on a continuing basis) against any tax liabilities, charges, levies, duties, social security liabilities, withholdings, other fiscal impositions and other similar deductions of any kind whatsoever, including any interest, charges, surcharges, fines and penalties thereon or claims made by Revenue arising from or in connection with the payment of the Termination Payment and any other payments contemplated under this Agreement, which may arise subsequent to the date hereof.
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4.
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Continuing obligations
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4.1
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The Employee shall continue to be bound by any of the provisions of the Employment Contract which are expressed to take effect on or to continue after the termination of his employment including, but not limited to, clauses 23, 24 and 25 thereof.
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4.2
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The Employee hereby covenants and agrees that he will not, from the Termination Date, hold himself out or expressly or impliedly represent to any third party that he has the authority to speak for, represent or in any way bind the Company, or any of its Associated Undertakings.
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4.3
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Without prejudice to any obligations owed by him under the Employment Contract, the Employee acknowledges that during the term of his employment, he had access to information which is confidential and/or proprietary to the Company, including but not limited to trade secrets, know-how, information that results from research and development, technical data, information concerning past, existing or prospective customers and/or suppliers and other information of a commercial, financial or technical nature relating in any way whatsoever to the business and affairs of the Company, and its Associated Undertakings (“Confidential Information”). The Employee undertakes and agrees that all Confidential Information shall be and remain at all times the exclusive property of the Company. The Employee further undertakes and agrees that he will not at any time prior to or following the termination of his employment with the Company reveal, publish or disclose Confidential Information to any person, association, future employer or company nor shall he use it for his own benefit or for the benefit of others without prior written consent of a duly authorised officer of the Company.
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5.
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Return of property
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5.1
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The Employee shall, no later than the Notice Effective Date, deliver up to the Company, all property belonging to the Company in his possession or under his control including but not limited to any Company vehicle and all accessories, Company mobile phone, laptop and any other electronic communication devices, security card or key to the premises, Company credit cards, Company files, personnel records, books, returns, Company information, memoranda, data, correspondence and all documentation prepared or obtained by the Employee in the course of his employment with the Company relating to its business and affairs; and the Employee undertakes not to retain copies of any of the foregoing documents without the prior written consent of the Company. The Employee agrees to provide a warranty to the Company, upon request, as to his compliance with this provision.
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5.2
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The Employee shall, no later than the Notice Effective Date, provide to the Company full details of all then current passwords used by the Employee in respect of computer equipment belonging to the Company or any Associated Undertaking and, having forwarded a copy to the Company, irretrievably delete from any computer drives, disks, tapes or other re-usable material and/or from any website and/or email account in the Employee’s possession or under his control (but which do not belong to the Company or any Associated Undertaking) any information belonging or relating to the business of the Company or any Associated Undertaking, their customers, clients or suppliers.
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6.
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No voluntary disclosure
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7.
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No adverse remarks
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8.
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Independent legal advice
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8.1
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The Employee confirms and agrees that he has been advised to and afforded the opportunity of obtaining independent legal advice regarding the contents and effect of this Agreement.
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8.2
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The Employee acknowledges that he understands the effect and implications of this Agreement. The Employee confirms that he has signed this Agreement with full understanding that he is releasing and compromising any and all claims that he has or might have against the Company arising from or connected with his employment with the Company and the termination of such employment.
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9.
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Supplemental waiver of claims
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10.
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General
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10.1
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This Agreement shall be governed by and construed in accordance with the laws of Ireland and the courts of Ireland shall have exclusive jurisdiction to deal with all disputes arising from or touching upon this Agreement.
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10.2
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For the purposes of this Agreement, “Associated Undertaking” means any undertaking which from time to time is a subsidiary of the Company or is a holding company of the Company or a subsidiary of any such holding company (“holding company” and “subsidiary” having the meanings set out in section 7 and 8 of the Irish Companies Act 2014). By way of example, but not limitation, Jazz Pharmaceuticals plc is an Associated Undertaking;
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10.3
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This Agreement contains the whole agreement between the Parties relating to the matters provided for in this Agreement and supersedes all previous agreements (if any) between the Parties in respect
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10.4
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This Agreement, although marked “without prejudice” and “subject to contract” shall, upon signature by both parties, be treated as an open document evidencing an agreement that is and will be binding on the parties.
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10.5
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This Agreement may be executed by the parties to this Agreement on separate counterparts, each of which when executed shall constitute the original and all such counterparts together constitute but one and the same instrument.
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Dated the 5 day of October 2019.
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SIGNED:
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/s/ Paul Treacy
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Paul Treacy
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DATE:
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05 Oct 2019.
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IN THE
PRESENCE OF:
Witness
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/s/ Veronique O’Sullivan
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Witness name,
occupation
and address
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VERONIQUE O'SULLIVAN
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PUBLIC SERVANT
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15 ARDFIELD MEADOWS
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ARDFIELD, DOUGLAS, CORK.
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SIGNED:
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/s/ Heidi Manna
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For and on behalf of the Company
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DATE:
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9/4/19
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Yours sincerely
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Witness Name:
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/s/ VERONIQUE O'SULLIVAN
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Witness Address:
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15 ARDFIELD MEADOWS, CORK
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/s/ Paul Treacy
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Witness Occupation:
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PUBLIC SERVANT
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Paul Treacy
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Date: 14 NOV 2019
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Date: 05 . OCT 2019
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Dated this 6 day of JAN [month] 2020 [year]
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Signed by:
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/s/ Paul Treacy
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Witness:
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/s/ Veronique O’Sullivan
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PAUL TREACY
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1.
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POSITION
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2.
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COMMENCEMENT DATE
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3.
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PLACE OF WORK
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4.
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HOURS OF WORK
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5.
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REPORTING STRUCTURE
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6.
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SALARY
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6.1.
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Your initial salary will be €170,000 per annum and shall accrue from day to day. This will be paid to you monthly in arrears on the last day of each month by credit transfer directly to your bank account. Your salary will be subject to annual review each year on the anniversary of the date of this contract. There is no obligation to award an increase. There will be no review of the salary after notice has been given by either party to terminate your employment.
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6.2.
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All payments to you will be subject to deductions of tax, PRSI, Universal Social Charge and any other deductions required by law or provided for in this contract. You will be notified each month by the Company of the amount of your gross and net remuneration and of the nature and amount of all deductions.
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6.3.
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For the purposes of the National Minimum Wage Act, 2000, the pay reference period shall be a month. In accordance with section 23 of the Act, you may request from the Company a written statement of your average hourly rate of pay for any pay reference period (other than a current pay reference period) falling within the twelve month period immediately preceding the request.
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6.4.
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The Company may deduct from your salary, or other sums owed to you, any money owed to the Company by you. Where the Company suffers loss as a result of your actions or omissions, deductions will be made only after you have received written notification providing at least one full week’s notice that the deduction will be made. The deduction must take place within 6 months of the loss/cost originally being incurred.
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7.
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BONUS
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7.1.
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You may be entitled to be considered for a bonus based on your performance. Any bonus payment will be made entirely at the sole discretion of the Board, at such intervals and subject to such conditions as the Board may in its absolute discretion determine from time to time.
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7.2.
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Any bonus payment to you shall be purely discretionary and shall not form part of your contractual remuneration under this contract. If the Company makes a payment to you, it shall not be obliged to make subsequent bonus payments.
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7.3.
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You will not be entitled to a bonus if your employment has been terminated, or notice of such termination has been given by either you or the Company, prior to the date the bonus is paid.
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8.
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EQUITY
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9.
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EXPENSES
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10.
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HOLIDAYS
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10.1.
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You will be entitled to 21 days’ holidays (exclusive of all Irish bank and other public holidays in accordance with the Organisation of Working Time Act 1997) in each year. Your holidays are to be taken by arrangement with the Company, at such time or times that the Company considers to be most convenient having regard to the requirements of your position.
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10.2.
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The Company’s holiday year runs from 1 January to 31 December. Holidays from the previous year may not be carried over to the following year except with the Company's consent. Upon notice of termination of employment being served by either party, the Company may, subject to the provisions of the Organisation of Working Time Act 1997, require you to take any unused holidays accrued at that time during any notice period. Alternatively, the Company may, at its discretion, on termination of the employment, make a payment in lieu of accrued contractual holiday entitlement.
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10.3.
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If you are ill during a period of annual leave and have a valid medical certificate for the days that you were ill, these sick days will not be counted as annual leave days.
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10.4.
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If on termination of employment, you have taken in excess of your accrued holiday entitlement, the Company shall be entitled to recover from you by way of deduction from any payments due to you or otherwise, one day’s pay for each excess day (calculated at l/260th of your salary for each excess day).
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11.
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PENSION
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12.
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DUTIES
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13.
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PERIOD OF EMPLOYMENT
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14.
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PAYMENT IN LIEU OF NOTICE / GARDEN LEAVE
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14.1.
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pay you in lieu of notice the amount of your entitlement to salary in respect of such notice period; or
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14.2.
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require you to cease performing or exercising during some or all of the remainder of any notice period some or all of the powers, authorities and discretions delegated to you in your employment and/or to cease attending your place of work during such period.
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15.
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TERMINATION WITHOUT NOTICE
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15.1.
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are guilty of any material breach or non-observance of the provisions contained in this contract;
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15.2.
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are guilty of any serious or gross misconduct and/or negligence in the discharge of the duties of your employment or in connection with or affecting the business of the Company;
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15.3.
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commit any serious act of dishonesty or repeated acts of dishonesty;
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15.4.
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cease to be eligible to work in the Republic of Ireland; or
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15.5.
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are convicted of a criminal offence which the Company considers affects or could affect your position within the Company (other than minor traffic offences).
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16.
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NORMAL RETIREMENT AGE
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17.
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ILLNESS
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17.1.
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Absences from work for whatever reason must be notified to your Manager as soon as possible before your usual start time on the first day of absence. You should telephone your Manager and confirm the reason for your absence and the expected length of such
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17.2.
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Payment of salary for any absences attributable to illness will be entirely at the sole discretion of the Company.
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17.3.
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If you are at any time prevented by illness, injury, accident or any other circumstances from discharging all your duties for a period of three consecutive days, then a satisfactory certificate will be required from your doctor in respect of such absence.
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17.4.
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The Company reserves the right, at any time, to require you to undergo a medical examination by a Doctor or Consultant nominated by the Company, in which event you agree to consent to this request and the Company will bear the cost of such examination.
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17.5.
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If your absence is or appears to be occasioned by actionable negligence, nuisance or breach of any statutory duty on the part of a third party in respect of which damages are or may be recoverable, you shall immediately notify your Manager of that fact and of any claim, compromise, settlement or judgment made or awarded in connection with it and all relevant particulars that the Company may reasonably require. You shall, if you have been in receipt of salary for a period of absence and if required by the Company, refund to the Company that part of any damages or compensation recovered by you relating to the loss of earnings for the period of sickness as the Company may reasonably determine less any costs borne by you in connection with the recovery of such damages or compensation, provided that the amount to be refunded shall not exceed the total amount paid to you by the Company in respect of the period of sickness.
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18.
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DISCIPLINARY RULES AND PROCEDURE
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18.1.
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You will conduct yourself with propriety at all times and with due regard for the Company and each of its associated companies and the clients and employees of each such company.
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18.2.
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In the event that your conduct or performance falls short of the standards required by the Company or the Board in any respect, (other than cases of misconduct) you will receive at first instance, a verbal warning, followed, if necessary in the event of a repetition, by a written warning which, in appropriate circumstances, may be deemed to be a final written warning. In the event of further breach of conduct or poor performance, and following due investigation during which you will be afforded an opportunity to make whatever representations you consider appropriate, your employment may be terminated by the Company, with or without notice as is deemed appropriate. Where appropriate, because of the gravity of your conduct or performance, the Company reserves the right to commence this procedure at any stage
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18.3.
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In order to investigate a complaint against you, the Company may suspend you on full pay for as long as may be necessary to carry out an investigation and hold a disciplinary hearing.
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19.
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MONITORING
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19.1.
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You consent to the Company monitoring and recording any use that you make of the Company’s electronic communications systems for the purpose of ensuring that the Company’s rules are being complied with and for legitimate business purposes. You shall comply with any electronic communication systems policies that the Company may issue from time to time.
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20.
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CONFIDENTIALITY
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20.1.
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You will not, except as authorised or required by your duties, reveal to any person, persons or company any information of a confidential or proprietary nature, including any trade secrets, secret or confidential operations, processes or dealings or any information concerning the organisation, business, finances, transactions or affairs of the Company, its subsidiary or associated companies or their existing or potential customers including but not limited to: client lists, prices, financial information, information on the marketing and development of products, which may come to your knowledge during the period of your employment with the Company (“Confidential Information”). You will keep all Confidential Information entrusted to you completely secret and will not use or attempt to use any Confidential Information in any manner which may injure or cause loss either directly or indirectly to the Company or any of its subsidiary or associated companies or their existing or potential customers or its or their business or businesses. This restriction will continue to apply after the termination of your employment without limit in point of time but will cease to apply to information or knowledge which may reasonably be said to have come into the public domain other than by reason of breach of the provisions of this contract.
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20.2.
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You will not during the term of your employment with the Company make, otherwise than for the benefit of the Company, any notes or memoranda relating to any matter within the scope of the business of the Company, its subsidiary or associated companies or their existing or potential customers or concerning any of the dealings or affairs of any such company nor will you either during the term of your employment with the Company or afterwards use or permit to be used any such notes or memoranda otherwise than for the benefit of the Company, it being the intention of the parties that all such notes or memoranda made by you will be the property of the Company and left at its offices upon the termination of your employment with the Company.
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21.
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PROPRIETARY RIGHTS
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21.1.
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In this Clause 21, “IP” means all intellectual property rights of whatever nature, including copyright (present and future), moral rights, patents, trademarks, trade names, domain names, rights in get-up, goodwill and the right to sue for passing off or unfair competition, rights in computer software, design rights, rights to inventions and database rights (whether or not any of these is registered and including any applications for registration of any such rights), rights to preserve the confidentiality of information(including trade secrets and know-how) and any other intellectual property rights, in each case whether registered or unregistered and including all applications (or rights to apply) for and be granted, renewals or extensions of, and rights to claim priority
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21.2.
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You will immediately disclose to the Company in writing full details of any discovery, invention, process or improvement in procedure made or discovered by you (whether or not in conjunction with any other person or persons) together with all works embodying IP rights while in the employment of the Company in connection with or in any way affecting or relating to the business of the Company, its subsidiary or associated companies or capable of being used or adapted for use therein or in connection therewith (“Inventions”). You acknowledge that all IP rights subsisting (or which may in the future subsist) in all such Inventions and works shall automatically, on creation, vest in the Company absolutely. To the extent that they do not vest automatically, you hold them on trust for the Company. You agree promptly to execute all documents and do all acts as may, in the opinion of the Company, be necessary to give effect to this clause.
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21.3.
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If and whenever required so to do (whether during or after the termination of your employment), you will without charge and at the expense of the Company or its nominee apply or join in applying for letters, patents or other forms of protection for any IP referred to in this Clause 20 and execute all instruments and do all things considered necessary in the absolute discretion of the Company in relation to the said IP including vesting all rights and titles to such IP, when obtained, in the Company (or its nominee) as sole beneficial owner, or in such other person as the Company may require.
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21.4.
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You irrevocably appoint the Company to be your attorney in your name and on your behalf to execute and do any such instruments or things and generally to use your name for the purpose of giving to the Company (or its nominee) the full benefit of the provisions of this Clause 21. A certificate in writing signed by any executive or the Secretary of the Company that any instrument or act falls within the authority conferred in this Clause 21.4 will be conclusive evidence that such is the case in favour of a third party.
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22.
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RESTRICTIVE COVENANTS
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22.1.
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You may not during the period of your employment with the Company, without prior written consent of the Company, engage, whether directly or indirectly, in any business or employment which is similar to or competitive with the business of the Company or its subsidiary or associated companies or which may in the Company’s opinion impair your ability to act at all times in the best interest of the Company.
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22.2.
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In order to protect the Confidential Information and business connections of the Company to which you have access as a result of your employment, you covenant with the Company that you shall not:
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22.2.1.
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for 6 months after the date of the termination of your employment, in the Republic of Ireland be employed, engaged, concerned or interested, in any business directly competing with the products sold by the Company or its subsidiary or associated companies at that time.
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22.2.2.
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for a period of 6 months after the termination of your employment, offer to employ or otherwise entice away from the Company or its subsidiary or associated companies, any
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22.2.3.
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for a period of 6 months after the termination of your employment, solicit or endeavour to entice away from the Company or its subsidiary or associated companies the business or custom of any firm, company or person who, during the 12 months before your termination of employment was a customer or prospective customer of the Company or its subsidiary or associated companies about whom you became aware or informed in the course of your employment, with a view to providing goods or services to that firm, company or person in competition with the services provided by the Company.
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22.2.4.
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for a period of 6 months after the termination of your employment, be involved with the provision of goods or services to (or otherwise have any business dealings with) any firm, company or person who, during the 12 months before the termination of your employment, was in the habit of dealing with the Company or its subsidiary or associated companies, in the course of any business concern which is in competition with the business of the Company.
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22.2.5.
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at any time after the termination of your employment, represent yourself as connected with the Company as agent, consultant, director, employee, owner, partner, shareholder or in any other capacity.
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22.3.
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You acknowledge and agree that all of the restrictions contained in this contract are reasonable and necessary to protect the interests of the Company and its subsidiary and associated companies and you agree that the Company may seek equitable remedies to enforce them in addition to any other legal remedies it has.
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22.4.
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The restrictions above apply to you acting directly or indirectly and on your own behalf or on behalf of, or in conjunction with, any firm, company or person.
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22.5.
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The time periods for which the restrictions apply shall be reduced by any period that you spend on garden leave.
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22.6.
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If any provision in this Clause 22 is deemed to be, or becomes invalid, illegal, void or unenforceable under applicable laws, such provision will be deemed amended to conform to applicable laws so as to be valid and enforceable (including, by way of example, by restricting the area, duration and/or scope of the covenants in to such area, duration and/or scope as would be held reasonable), or if it cannot be so amended without materially altering the intention of the parties, it will be deleted, but the validity, legality and enforceability of the remaining provisions of this contract shall not be impaired or affected in any way.
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23.
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PROBATIONARY PERIOD
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22.1
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The first six months of your employment will be on a probationary basis. The Company may, at its discretion, extend the probationary period for a further period of up to four months where it deems appropriate. During the probationary period your performance and suitability will be monitored and your employment is subject to the satisfactory completion of the probationary period. Your employment may be terminated at any time
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24.
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DATA PROTECTION ACTS 1988 AND 2003
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24.1.
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You hereby acknowledge that during the course of your employment with the Company, the Company will keep personal data and sensitive personal data (e.g. doctor’s certificates or medical reports) relating to you on computer and in manual files/paper files. You hereby acknowledge and agree that the Company is permitted to hold and process personal information about you as part of its personnel and other business records and may use such information in the course of the Company’s business. You further agree that the Company may disclose such information to third parties in the event that such disclosure is in the Company’s view required by the proper conduct of the Company’s business. This clause applies to information held, used or disclosed in any medium.
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25.
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HEALTH & SAFETY
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25.1.
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The Company takes seriously its obligations regarding the safety, health and welfare of its employees and in that regard your attention is drawn to the Company safety statement (which is available for viewing on the intranet). By signing this contract, you agree to take reasonable care of your own safety and health and that of any other persons who may be affected by your acts or admissions while at work. You also agree to cooperate with the Company and any other person to enable compliance with any provision of the Safety, Health and Welfare at Work Acts 1989 and 2005 and any Regulation made thereunder.
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26.
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COLLECTIVE AGREEMENT
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26.1.
|
There is no collective agreement which directly affects your employment.
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27.
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MISCELLANEOUS PROVISIONS
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27.1.
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Notices. Any notice under this contract will be given in writing and will be deemed to have been duly given if delivered personally to the addressee or the duly authorised agent of the addressee or sent by prepaid registered post to the last known address of the party to whom such notice is given. Any such notice will be deemed to have been duly given at the time of delivery if delivered personally, or two working days after posting if sent by prepaid registered post.
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27.2.
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Entire Agreement. This contract is in substitution for all previous agreements and undertakings (if any) either written or verbal between the Company and you, and all such agreements and undertakings will be deemed to have been terminated by mutual consent as from the date of your execution of this contract.
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27.3.
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Governing Law and Jurisdiction. This Agreement shall be governed by and construed in accordance with the laws of Ireland, and shall be subject to the exclusive jurisdiction of the Irish courts.
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27.4.
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The information contained in this contract constitutes a written statement of particulars of your employment with the Company in accordance with the requirements of section 3 of the Terms of Employment Act 1994 and 2001.
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Yours sincerely
/s/ Fintan Keegan
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Fintan Keegan
Duly authorised for and on behalf of
Jazz Pharmaceuticals Ireland Limited
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I accept employment with the Company on the terms and conditions as set out in the Company’s contract of which this is a copy.
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|
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Signed:
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/s/ Finbar Larkin
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Dated:
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22 Feb 2013
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CONTENTS
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Clause
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Page
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1.
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Interpretation
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1
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2.
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Term of appointment
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3
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3.
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Duties
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4
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4.
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Place of work
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5
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5.
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Hours of work
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5
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6.
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Salary
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6
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7.
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Expenses
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6
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8.
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Bonus
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7
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9.
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Permanent health insurance
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7
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10.
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Life assurance
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8
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11.
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Private medical insurance
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9
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12.
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Car Allowance
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9
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13.
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Holidays
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10
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14.
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Incapacity
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11
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15.
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Outside interests
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11
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16.
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Confidential information
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12
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17.
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Intellectual property
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12
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18.
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Termination
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14
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19.
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Garden leave
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16
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20.
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Obligations upon termination
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17
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21.
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Post-termination restrictions
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17
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22.
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Disciplinary and grievance procedures
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19
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23.
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Pensions
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20
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24.
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Reconstruction and amalgamation
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20
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25.
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Notices
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20
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26.
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Entire agreement
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21
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27.
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Variation
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21
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28.
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Counterparts
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21
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29.
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Third party rights
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21
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30.
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Governing law and jurisdiction
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22
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(1)
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JAZZ PHARMACEUTICALS UK LIMITED whose registered office is at Spires House, Wing B, Building 5700, John Smith Drive, Oxford Business Park South, Oxford OX4 2RW (the “Company”); and
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(2)
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Samantha Pearce of [Address] (“Employee”).
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1.
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Interpretation
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1.1
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The definitions and rules of interpretation in this clause 1.1 apply in this Agreement.
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Samantha Pearce
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Page 1
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2019-4444_SR
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Samantha Pearce
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Page 2
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1.2
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The headings in this Agreement are inserted for convenience only and shall not affect its construction.
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1.3
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A reference to a particular law is a reference to it as it is in force for the time being, taking account of any amendment, extension, or re-enactment and includes any subordinate legislation for the time being in force made under it.
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2.
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Term of appointment
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2.1
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The Company shall employ the Employee and the Employee shall serve the Company on the terms of this Agreement.
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2.2
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The first six months of the Appointment shall be a probationary period and the Appointment may be terminated during this period at any time on one week’s prior notice. The Company may, at its discretion, extend this period. During this probationary period the Employee’s performance and suitability for continued employment will be monitored. At the end of the probationary period the Employee will be informed in writing if she has successfully completed her probationary period.
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2.3
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The Appointment shall commence on the Commencement Date and shall continue, subject to the remaining terms of this Agreement, until terminated by either party giving the other not less than six months prior notice in writing.
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2.4
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The Employee represents and warrants to the Company that, by entering into this Agreement or performing any of her obligations under it, she will not be in breach of any court order or any express or implied terms of any contract or other obligation binding on her and undertakes to indemnify the Company against any claims, costs, damages, liabilities or expenses which the Company may incur as a result if she is in breach of any such obligations.
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Samantha Pearce
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Page 3
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2.5
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The Employee warrants that she is entitled to work in the United Kingdom without any additional approvals and will notify the Company immediately if she ceases to be so entitled during the Appointment.
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2.6
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The Employee consents to the transfer of her employment under this agreement to an Associated Employer at any time during the Appointment.
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3.
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Duties
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3.1
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The Employee shall serve the Company as Head of Europe and RoW or such other role as the Company considers appropriate.
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3.2
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This position is at the level of Senior Vice President.
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3.3
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The role is reporting to Dan Swisher, President and Chief Operating Officer. The reporting structure can be changed by the Company at its sole discretion at any time during the Employment.
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3.4
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During the Appointment the Employee shall:
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(a)
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unless prevented by Incapacity, devote the whole of her time, attention and abilities to the business of the Company or any other Group Company;
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(b)
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diligently exercise such powers and perform such duties as may from time to time be assigned to her by the Company;
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(c)
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comply with all reasonable and lawful directions given to her by the Company;
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(d)
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promptly make such reports to her manager in connection with the affairs of any Group Company on such matters and at such times as are reasonably required;
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(e)
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report her own wrongdoing and any wrongdoing or proposed wrongdoing of any other employee or director of any Group Company under the reporting procedures set forth in the Employee Handbook and/or the global Jazz Pharmaceuticals Code of Conduct (to the extent applicable);
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(f)
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use her best endeavours to promote, protect, develop and extend the business of any Group Company;
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(g)
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consent to the Company monitoring and recording any use that she makes of the Company’s electronic communications systems for the purpose of ensuring that the Company’s rules are being complied with and for legitimate business purposes; and
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2019-4444_SR
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Samantha Pearce
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Page 4
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(h)
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comply with any applicable electronic communication systems policy that the Company and/or any Group Company may issue from time to time.
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3.5
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The Employee’s attention is drawn to the UK Employee Handbook (containing various rules and procedures), and the global Jazz Pharmaceuticals Code of Conduct, both of which are available on the Jazz Intranet (JazzNet). The UK Employee Handbook does not form part of the Employee’s contract of employment with the Company. For the avoidance of doubt, to the extent that there is any conflict between the terms of this Agreement and the UK Staff Handbook, this Agreement shall prevail.
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3.6
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JAZZ PHARMACEUTICALS UK LIMITED and Jazz Pharmaceuticals are committed to integrity and the pursuit of excellence in all we do. We fulfill these commitments while upholding a high level of ethical conduct. The Code of Conduct is one element of Jazz Pharmaceuticals’ efforts to ensure lawful and ethical conduct by the company and its subsidiaries and their employees, officers and directors. It is a condition of employment that you read, agree to and sign Jazz Pharmaceuticals’ Code of Conduct in the first week of employment.
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4.
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Place of work
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4.1
|
The Employee’s normal place of work is the Jazz Pharmaceuticals Oxford office or such other place within a reasonable distance which the Company may reasonably require for the proper performance and exercise of her duties.
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4.2
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The Employee agrees to travel on any Group Company’s business (both within the United Kingdom or abroad) as may be required for the proper performance of her duties under the Appointment. There are no additional terms which apply where the Employee is required to work outside the UK for a period of more than one month. The Company reserves the right to issue terms relating to the Employee’s work outside the UK and any such terms will be notified to her separately.
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5.
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Hours of work
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5.1
|
The Employee’s normal working hours shall be 9.00am to 5.30pm on Mondays to Fridays and such additional hours as are necessary for the proper performance of her duties. The Employee acknowledges that she shall not receive further remuneration in respect of such additional hours.
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2019-4444_SR
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Samantha Pearce
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Page 5
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5.2
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Due to the autonomous nature of the Employees’ role, the duration of the Employee’s working time is not measured or monitored, or determined by the Company and the limitations on weekly working time set out in Regulation 4 of the Working Time Regulations 1998 (the “Regulations”) (or such other regulations amending or substituting those from time to time) does not apply to the Employee’s Appointment. In the event that any additional hours worked by the Employee outside normal working hours are not covered by regulation 20(2) of the Regulations, the Employee agrees that the 48 hour limit on the working week stipulated in the Regulations will not apply to her and she must give three months’ written notice to the Company if she wishes to change this.
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6.
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Salary
|
6.1
|
The Employee shall be paid an initial basic salary of £325,000 [three hundred and twenty five thousand pounds] per annum.
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6.2
|
The Employee’s basic salary shall accrue from day to day and be payable monthly in arrears on the Company’s scheduled pay dates directly into the Employee’s bank or building society.
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6.3
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Salaries are normally reviewed on or about 1 March of each year. Employees whose Appointment begins on or after 1 November are not eligible for salary review the following March. The Company is under no obligation to award an increase following a salary review. There will be no review of the basic salary after notice has been given by either party to terminate the Appointment.
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6.4
|
The Company may deduct from the basic salary, or any other sums owed to the Employee, any money owed to any Group Company by the Employee, and the Employee hereby consents to such deductions.
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7.
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Expenses
|
7.1
|
The Company shall reimburse (or procure the reimbursement of) all reasonable expenses wholly, properly and necessarily incurred by the Employee in the course of the Appointment, subject to production of receipts or other appropriate evidence of payment.
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7.2
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The Employee shall abide by the Company’s policies on expenses as communicated to her from time to time.
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7.3
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Any credit card supplied to the Employee by the Company shall be used only for expenses incurred by her in the course of the Appointment.
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2019-4444_SR
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Samantha Pearce
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Page 6
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8.
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Bonus
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8.1
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The Company may in its absolute discretion pay the Employee a bonus of such amount, at such intervals and subject to such conditions as the Company may in its absolute discretion determine. With respect to an annual bonus for the calendar year in which the Employee is hired, the Employee will be eligible for consideration of a prorated bonus for the year of hire only if the Employee is hired no later than 31 October of such year; and if the Employee is hired on 1 November or later, the Employee is not eligible for consideration of any annual bonus for the year of hire.
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8.2
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Any bonus payment to the Employee shall be purely discretionary and shall not form part of the Employee’s contractual remuneration under this Agreement. If the Company makes a bonus payment to the Employee in respect of a particular financial year of the Company (being the period from 1 January to 31 December), it shall not be obliged to make subsequent bonus payments in respect of subsequent financial years of the Company.
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8.3
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The Company may alter the terms of any bonus targets or withdraw them altogether at any time without prior notice.
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8.4
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Notwithstanding clause 8.1, the Employee shall in any event have no right to a bonus or a time-apportioned bonus if her employment terminates for any reason or she is under notice of termination (whether given by the Employee or the Company) at or prior to the date when a bonus might otherwise have been payable.
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8.5
|
Any bonus payable in accordance with clause 8 shall not be pensionable.
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9.
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Permanent health insurance
|
9.1
|
The Employee shall be entitled to participate in the Company’s permanent health insurance scheme at the Company’s expense, subject to:
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(a)
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the terms of the Company’s scheme, as amended from time to time;
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(b)
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the rules or insurance policy of the relevant insurance provider, as amended from time to time; and
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(c)
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the Employee satisfying the normal underwriting requirements of the relevant insurance provider of the Company’s scheme and the premium being at a rate which the Company considers reasonable.
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2019-4444_SR
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Samantha Pearce
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Page 7
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9.2
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The Company shall only be obliged to make payments to the Employee under the scheme if it has received payment from the insurance provider for that purpose.
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9.3
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The Company in its sole and absolute discretion reserves the right to discontinue, vary or amend the scheme (including the level of the Employee’s cover) at any time on reasonable notice to the Employee.
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9.4
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If the insurance provider refuses for any reason to provide permanent health insurance benefit to the Employee, the Company shall not be liable to provide to the Employee any replacement benefit of the same or similar kind or to pay any compensation in lieu of such benefit.
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9.5
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If the Employee is receiving benefits under the Company’s permanent health insurance scheme the Company shall be entitled to appoint a successor to the Employee to perform all or any of the duties required of the Employee under the terms of the Appointment and the Employee’s duties shall be amended accordingly.
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9.6
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The receipt by the Employee of any benefits under a permanent health insurance scheme operated by the Company shall not prejudice the Company’s rights to terminate this Appointment in accordance with the terms of this Agreement. In the event that the Company terminates the Appointment in accordance with its rights, the Employee acknowledges that she will not be entitled to any compensation for breach of contract or unfair dismissal in respect of the loss of any rights to permanent health insurance benefits.
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10.
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Life assurance
|
10.1
|
The Employee shall be entitled to participate in the Company’s life assurance scheme which shall pay to the Employee’s nominated beneficiary or beneficiaries a sum equal to four (4) times the Employee’s basic salary if the Employee dies during the Appointment. Participation is subject to:
|
(a)
|
the terms of the Company’s life assurance scheme, as amended from time to time;
|
(b)
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the rules or insurance policy of the relevant insurance provider, as amended from time to time; and
|
(c)
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the Employee satisfying the normal underwriting requirements of the relevant insurance provider of the Company’s life assurance scheme and the premium being at a rate which the Company considers reasonable.
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2019-4444_SR
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Samantha Pearce
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Page 8
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10.2
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If the insurance provider refuses for any reason to provide life assurance benefit to the Employee the Company shall not be liable to provide to the Employee any replacement benefit of the same or similar kind or to pay any compensation in lieu of such benefit.
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10.3
|
The Company in its sole and absolute discretion reserves the right to discontinue, vary or amend its life assurance scheme (including the level of the Employee’s cover) at any time on reasonable notice to the Employee.
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11.
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Private medical insurance
|
11.1
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The Employee and qualifying members of the Employee’s family shall be entitled to participate in the Company’s private medical insurance scheme subject to:
|
(a)
|
the terms of that scheme, as amended from time to time;
|
(b)
|
the rules or insurance policy of the relevant insurance provider, as amended from time to time; and
|
(c)
|
the Employee and qualifying members of the Employee’s family satisfying the normal underwriting requirements of the relevant insurance provider of the Company’s private medical insurance scheme and the premium being at a rate which the Company considers reasonable.
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11.2
|
If the insurance provider refuses for any reason to provide private medical insurance benefit to the Employee the Company shall not be liable to provide to the Employee any replacement benefit of the same or similar kind or to pay any compensation in lieu of such benefit.
|
11.3
|
The Company in its sole and absolute discretion reserves the right to discontinue, vary or amend the scheme (including the level of the Employee’s cover) at any time on reasonable notice to the Employee.
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12.
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Car Allowance
|
12.1
|
Provided that the Employee holds a current valid driving licence, the Employee shall receive a car allowance for use of the Employee’s own car of £12,000 per annum, which shall be payable together with and in the same manner as the salary in accordance with clause 6. The car allowance shall not be treated as part of the basic salary for any purpose and shall not be pensionable.
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2019-4444_SR
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Samantha Pearce
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Page 9
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12.2
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The Company shall reimburse the Employee in respect of fuel costs for business miles at the Company’s business mileage rate.
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12.3
|
The Employee shall immediately inform the Company if she is disqualified from driving and shall cease to be entitled to receive the allowance under clause 12.1 or reimbursement of fuel expenses under clause 12.2.
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13.
|
Holidays
|
13.1
|
The Employee shall be entitled to 25 days’ paid holiday in each holiday year, and 3 of these days must be taken between Christmas and New Year. In addition, the Employee is eligible for the usual public holidays in England and Wales to a maximum of 8 per year. The Company’s holiday year runs between 1 January and 31 December. If the Appointment commences part way through the holiday year, the Employee’s holiday entitlement during the first year of the Appointment shall be calculated on a pro-rata basis, rounded to the nearest whole day.
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13.2
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Holiday shall be taken at such time or times as shall be approved in advance by the Employee’s manager. The Employee shall not, without the consent of her manager, carry forward any accrued and unused holiday entitlement to a subsequent holiday year, nor receive any payment in lieu in respect of such entitlement, save as provided in clause 13.3.
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13.3
|
On termination of the Appointment, the Employee shall be entitled to be paid in lieu of accrued but untaken holiday save that, where such termination is pursuant to clause 18.4 or follows the Employee’s resignation in breach of clause 2.3, such accrued but untaken holiday shall be based on the Employee’s minimum holiday entitlement under the Working Time Regulations 1998 only and not on her entitlement under clause 13.1. For these purposes any paid holiday that has been taken by the Employee (including any paid holiday on public holidays) shall be deemed first to be statutory paid holiday. The amount of the payment in lieu shall be calculated on the basis that each day of paid holiday is equal to 1/260 of the salary. The Company reserves the right to exercise its discretion as to whether the Employee will be paid in lieu of accrued but untaken holidays or if the Employee will be asked to work those accrued but untaken holidays, if they fall within the notice period.
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13.4
|
If the Employee has taken more holiday than her accrued entitlement at the date of termination of the Appointment, the Company shall deduct the appropriate amount from any payments due to the Employee (on the basis that each day of paid holiday is equal to 1/260 of the salary).
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2019-4444_SR
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Samantha Pearce
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Page 10
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13.5
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If either party has served notice to terminate the Appointment, the Company may require the Employee to take any accrued but unused holiday entitlement during the notice period or, if applicable, any such holiday shall be deemed to be taken during any period of Garden Leave.
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14.
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Incapacity
|
14.1
|
If the Employee is absent due to sickness or injury she must inform her manager no later than 10.00am on the first day absent or as soon as possible given the time difference between the USA and the UK.
|
14.2
|
The Employee will be required to produce a self-certification form in respect of absences up to and including 5 working days. The Company reserves the right to require the Employee to obtain a Statement of fitness for work (Fit Note) from a Doctor in respect of any such period of absence.
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14.3
|
The Employee must, if absent for a period of 7 consecutive days, provide the Company with a Statement of fitness for work (Fit Note), stating the reason for the absence and thereafter provide a like certificate each week to cover any subsequent periods of absence. The Company reserves the right at any time during the Employees absence to ask the Employee to produce a medical certificate (or Fit Note).
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14.4
|
The Company reserves the right to ask the Employee to undergo a medical examination with a medical practitioner of the Company’s choosing at any time during a period of absence due to illness or Incapacity subject to the provisions of the Access to Medical Reports Act 1988.
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15.
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Outside interests
|
15.1
|
Subject to clause 15.2, during the Appointment the Employee shall not, except as a representative of the Company or with the prior written approval of the Company, whether paid or unpaid, be directly or indirectly engaged, concerned or have any financial interest in any Capacity in any other business, trade, profession or occupation (or the setting up of any business, trade, profession or occupation).
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15.2
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Notwithstanding clause 15.1, the Employee may hold an investment by way of shares or other securities of not more than 5% of the total issued share capital of any company (whether or not it is listed or dealt in on a recognised stock exchange) where such company does not carry on a business similar to or competitive with any business for the time being carried on by the Company or any Group Company.
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2019-4444_SR
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Samantha Pearce
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Page 11
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15.3
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The Employee agrees to disclose to the Company any matters relating to her spouse or civil partner (or anyone living as such), children or parents which may, in the reasonable opinion of the Company, be considered to interfere, conflict or compete with the proper performance of the Employee’s obligations under this Agreement.
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16.
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Confidential information
|
16.1
|
The Employee acknowledges that in the course of the Appointment she will have access to Confidential Information. The Employee has therefore agreed to accept the restrictions in this clause 16.
|
16.2
|
The Employee shall not (except in the proper course of her duties), either during the Appointment or at any time after its termination (howsoever arising), use, copy, transfer or disclose to any person, company or other organisation whatsoever (and shall use her best endeavours to prevent the use, copying, transfer, publication or disclosure of) any Confidential Information. This restriction does not apply to:
|
(a)
|
any use or disclosure authorised by the Directors of the Company or required by law; or
|
(b)
|
any information which is already in, or comes into, the public domain other than through the Employee’s unauthorised disclosure; or
|
(c)
|
prevent the Employee from making a protected disclosure within the meaning of section 43A of the Employment Rights Act 1996.
|
17.
|
Intellectual property
|
17.1
|
The Employee acknowledges that all Employment IPRs, Employment Inventions and all materials embodying them shall automatically belong to the Company to the fullest extent permitted by law. To the extent that they do not vest in the Company automatically, the Employee holds them on trust for the Company.
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17.2
|
The Employee acknowledges that, because of the nature of her duties and the particular responsibilities arising from the nature of her duties, she has, and shall have at all times while she is employed by the Company, a special obligation to further the interests of the Company.
|
17.3
|
To the extent that legal title in any Employment IPRs or Employment Inventions does not vest in the Company by virtue of clause 17.1, the Employee agrees, immediately upon creation of such rights and inventions, to offer to the Company in writing a right of first refusal to acquire them on arm´s length terms to be agreed between the parties. If the parties cannot agree on
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2019-4444_SR
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Samantha Pearce
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Page 12
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17.4
|
The Employee agrees:
|
(a)
|
to give the Company full written details of all Employment Inventions promptly on their creation;
|
(b)
|
at the Company’s request and in any event on the termination of her employment to give to the Company all originals and copies of correspondence, documents, papers and records on all media which record or relate to any of the Employment IPRs;
|
(c)
|
not to attempt to register any Employment IPR nor patent any Employment Invention unless requested to do so by the Company; and
|
(d)
|
to keep confidential each Employment Invention unless the Company has consented in writing to its disclosure by the Employee.
|
17.5
|
The Employee waives all her present and future moral rights which arise under the Copyright Designs and Patents Act 1988, and all similar rights in other jurisdictions relating to any copyright which forms part of the Employment IPRs, and agrees not to support, maintain nor permit any claim for infringement of moral rights in such copyright works.
|
17.6
|
The Employee acknowledges that, except as provided by law, no further remuneration or compensation other than that provided for in this Agreement is or may become due to the Employee in respect of her compliance with this clause. This clause is without prejudice to the Employee’s rights under the Patents Act 1977.
|
17.7
|
The Employee undertakes to use her best endeavours to execute all documents and do all acts both during and after her employment by the Company as may, in the opinion of the Company, be necessary or desirable to vest the Employment IPRs in the Company, to register them in the name of the Company and to protect and maintain the Employment IPRs and the Employment Inventions. Such documents may, at the Company’s request, include waivers of all and any statutory moral rights relating to any copyright works which form part of the Employment IPRs. The Company agrees to
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2019-4444_SR
|
Samantha Pearce
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Page 13
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17.8
|
The Employee agrees to give all necessary assistance to the Company to enable it to enforce its Intellectual Property Rights against third parties, to defend claims for infringement of third party Intellectual Property Rights and to apply for registration of Intellectual Property Rights, where appropriate throughout the world, and for the full term of those rights.
|
17.9
|
The Employee hereby irrevocably appoints the Company to be her attorney to execute and do any such instrument or thing and generally to use her name for the purpose of giving the Company or its nominee the benefit of this clause 17. The Employee acknowledges in favour of a third party that a certificate in writing signed by any Director of the Company that any instrument or act falls within the authority conferred by this clause 17 shall be conclusive evidence that such is the case.
|
18.
|
Termination
|
18.1
|
Notwithstanding clause 2.3, the Company may, in its sole and absolute discretion, terminate the Appointment at any time and with immediate effect by paying a sum in lieu of notice (Payment in Lieu) equal to the basic salary (as at the date of termination) which the Employee would have been entitled to receive under this Agreement during the notice period referred to in clause 2.3 (or, if notice has already been given, during the remainder of the notice period) less income tax and National Insurance contributions. For the avoidance of doubt, the Payment in Lieu shall not include any element in relation to:
|
(a)
|
any bonus or incentive compensation payments that might otherwise have been due during the period for which the Payment in Lieu is made;
|
(b)
|
any payment in respect of benefits which the Employee would have been entitled to receive during the period for which the Payment in Lieu is made, including but not limited to car allowance; and
|
(c)
|
any payment in respect of any holiday entitlement that would have accrued during the period for which the Payment in Lieu is made.
|
18.2
|
The Company may pay any sums due under clause 18.1 in equal monthly instalments until the date on which the notice period referred to in clause 2.3 would have expired if notice had been given.
|
18.3
|
The Employee shall have no right to receive a Payment in Lieu unless the Company has exercised its discretion in clause 18.1. Nothing in this clause 18.3 shall prevent the Company from terminating the Appointment in breach.
|
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Samantha Pearce
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Page 14
|
18.4
|
The Company may also terminate the Appointment with immediate effect without notice, with no liability to make any further payment to the Employee (other than in respect of amounts accrued due at the date of termination) and without compensation, damages or otherwise if the Employee (without limitation):
|
(a)
|
fails or ceases to meet the requirements of any regulatory body whose consent is required to enable her to undertake all or any of her duties under the Appointment or is guilty of a serious breach of the rules and regulations of such regulatory body or of any compliance manual of any Group Company; or
|
(b)
|
is guilty of any gross misconduct; or
|
(c)
|
commits any serious or repeated breach or non-observance of any of the provisions of this Agreement or refuses or neglects to comply with any reasonable and lawful directions of the Company; or
|
(d)
|
is, in the reasonable opinion of the SVP Human Resources, President International, General Counsel or Directors of the Company, negligent and incompetent in the performance of her duties; or
|
(e)
|
is declared bankrupt or makes any arrangement with or for the benefit of her creditors or has a county court administration order made against her under the County Court Act 1984; or
|
(f)
|
is convicted of any criminal offence (other than an offence under any road traffic legislation in the United Kingdom or elsewhere for which a fine or non-custodial penalty is imposed) or any offence under any regulation or legislation relating to insider dealing; or
|
(g)
|
becomes medically certified as non-compos mentis (of unsound mind) and/or deemed legally incompetent; or
|
(h)
|
ceases to be eligible to work in the United Kingdom in accordance with section 8 of the Asylum and Immigration Act 1996; or
|
(i)
|
is guilty of any fraud or dishonesty or acts in any manner which in the opinion of the Company brings or is likely to bring the Employee or any Group Company into disrepute or is materially adverse to the interests of any Group Company; or
|
(j)
|
is guilty of a serious breach of any applicable rules issued by the Company or any Group Company from time to time regarding electronic communications systems.
|
18.5
|
The rights of the Company under clause 18.4 are without prejudice to any other rights that it might have at law to terminate the Appointment or to accept any breach of this Agreement by the Employee as having brought the Agreement to an end. Any delay by the Company in exercising its rights to terminate shall not constitute a waiver thereof.
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Samantha Pearce
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Page 15
|
18.6
|
Should the employee become incapacitated during the notice period, as a result of voluntary resignation, the company sick pay will be discretionary. However the employee will be entitled to statutory sick pay under government legislation.
|
19.
|
Garden leave
|
19.1
|
Following service of notice to terminate the Appointment by either party, or if the Employee purports to terminate the Appointment in breach of contract, and, if the Company so decides, at any time during the Appointment or in order to investigate a reasonable belief that the Employee is guilty of gross misconduct, the Company may by written notice require the Employee not to perform any services (or to perform only specified services) for the Company or any Group Company until the termination of the Appointment (such period to be referred to as “Garden Leave”).
|
19.2
|
During any period of Garden Leave the Company shall be under no obligation to provide any work to, or vest any powers in, the Employee, who shall have no right to perform any services for the Company or any Group Company.
|
19.3
|
During any period of Garden Leave the Employee shall:
|
(a)
|
continue to receive her salary and all contractual benefits in the usual way and subject to the terms of any benefit arrangement;
|
(b)
|
remain an employee of the Company and bound by the terms of this Agreement and her implied duties;
|
(c)
|
not, without the prior written consent of the Employee’s manager, attend her place of work or any other premises of the Company or any Group Company;
|
(d)
|
not, without the prior written consent of her manager, contact or deal with (or attempt to contact or deal with) any officer, employee, consultant, client, customer, supplier, agent, distributor, shareholder, adviser or other business contact of the Company or any Group Company; and
|
(e)
|
(except during any periods taken as holiday in the usual way) ensure that her manager knows where she will be and how she can be contacted during each working day and shall comply with any written requests to contact a specified employee of the Company at specified intervals.
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Samantha Pearce
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|
20.
|
Obligations upon termination
|
20.1
|
On termination of the Appointment (howsoever arising) or, if earlier, at the start of a period of Garden Leave, or at any other time at the request of the Company, the Employee shall:
|
(a)
|
subject to clause 20.1(b) if applicable, immediately deliver to the Company all documents, books, materials, records, correspondence, papers and information (on whatever media and wherever located) relating to the business or affairs of the Company or any Group Company or their business contacts, any keys, credit card and any other property of the Company or any Group Company (including but not limited to laptop, computer equipment, and mobile phone), which is in her possession or under her control;
|
(b)
|
where the Employee is on Garden Leave she shall not be required to return to the Company any property provided to her as a contractual benefit;
|
(c)
|
irretrievably delete any information relating to the business of the Company or any Group Company stored on any magnetic or optical disk or memory and all matter derived from such sources which is in her possession or under her control outside the Company’s premises, including but not limited to any personally-owned computer, laptop, mobile phone, or other electronic system or device;
|
(d)
|
irretrievably delete all of the Employee’s electronic personal information and personal files (which contain no information of the Company or any Group Company) from the Company’s electronic devices (such as Company-provided laptop); and
|
(e)
|
provide a signed statement that she has complied fully with her obligations under this clause 20.1.
|
20.2
|
On termination of the Appointment howsoever arising the Employee agrees that she shall not be entitled to any compensation of any kind for the loss of any rights or benefits under any share option, bonus, long-term incentive plan or other profit sharing scheme operated by the Company or any Group Company in which she may participate or have received awards in connection with the Appointment.
|
21.
|
Post-termination restrictions
|
21.1
|
In order to protect the Confidential Information, trade secrets, goodwill and business connections of the Company and each Group Company to which she has access as a result of the Appointment and the stable workforce of the Company and each Group Company, the Employee covenants with the
|
2019-4444_SR
|
Samantha Pearce
|
Page 17
|
(a)
|
for six months after Termination solicit or endeavour to entice away from the Company or any Group Company the business or custom of a Restricted Customer with a view to providing goods or services to that Restricted Customer in competition with any Restricted Business; or
|
(b)
|
for six months after Termination in the course of any business concern which is in competition with any Restricted Business, offer to employ or engage or otherwise endeavour to entice away from the Company or any Group Company any Restricted Person; or
|
(c)
|
for three months after Termination, be involved in any Capacity with any business concern which is (or intends to be) in competition with any Restricted Business; or
|
(d)
|
for three months after Termination be involved with the provision of goods or services to (or otherwise have any business dealings with) any Restricted Customer in the course of any business concern which is in competition with any Restricted Business; or
|
(e)
|
at any time after Termination, represent herself as connected with the Company or any Group Company in any Capacity (with the exception of the Employee’s connection as a shareholder of Jazz Pharmaceuticals plc, to the extent applicable).
|
21.2
|
None of the restrictions in clause 21.1 shall prevent the Employee from:
|
(a)
|
holding an investment by way of shares or other securities of not more than 5% of the total issued share capital of any company, whether or not it is listed or dealt in on a recognised stock exchange; or
|
(b)
|
being engaged or concerned in any business concern insofar as the Employee’s duties or work shall relate solely to geographical areas where the business concern is not in competition with any Restricted Business; or
|
(c)
|
being engaged or concerned in any business concern, provided that the Employee’s duties or work shall relate solely to services or activities of a kind with which the Employee was not concerned to a material extent in the six months prior to Termination.
|
21.3
|
The restrictions imposed on the Employee by this clause 21 apply to her acting:
|
(a)
|
directly or indirectly; and
|
2019-4444_SR
|
Samantha Pearce
|
Page 18
|
(b)
|
on her own behalf or on behalf of, or in conjunction with, any firm, company or person.
|
21.4
|
The periods for which the restrictions in clause 21.1 apply shall be reduced by any period that the Employee spends on Garden Leave immediately prior to Termination.
|
21.5
|
If the Employee receives an offer to be involved in a business concern in any Capacity during the Appointment, or prior to the expiry of the last of the covenants in this clause 21, the Employee shall give the person making the offer a copy of this clause 21 and shall tell the Company the identity of that person as soon as possible after accepting the offer.
|
21.6
|
The Company and the Employee entered into the restrictions in this clause 21 having been separately legally advised and the Employee agrees they are fair, reasonable and necessary to protect the goodwill and interests of the Company and the Group Companies.
|
21.7
|
Each of the restrictions in this clause 21 is intended to be separate and severable. If any of the restrictions shall be held to be void but would be valid if part of their wording were deleted, such restriction shall apply with such deletion as may be necessary to make it valid or effective.
|
21.8
|
The Employee will, at the request and expense of the Company, enter into a separate agreement with any Group Company in which she agrees to be bound by restrictions corresponding to those restrictions in this clause 21 (or such of those restrictions as may be appropriate) in relation to that Group Company.
|
22.
|
Disciplinary and grievance procedures
|
22.1
|
The Employee is subject to the Company’s disciplinary and grievance procedures as amended from time to time, copies of which are available from the Human Resources Department. These procedures do not form part of the Employee’s contract of employment.
|
22.2
|
If the Employee wishes to appeal against a disciplinary decision she may do so in accordance with the Company’s disciplinary procedure.
|
22.3
|
The Company may at any time suspend the Employee for a period of up to 20 working days during any period in which the Company is carrying out a disciplinary investigation into any alleged acts or defaults of the Employee. During any period of suspension the Employee shall continue to receive her salary and contractual benefits.
|
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|
Samantha Pearce
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Page 19
|
22.4
|
If the Employee wishes to raise a grievance, she may apply in writing in accordance with the Company’s grievance procedure.
|
23.
|
Pensions
|
23.1
|
During each year of the Appointment, the Company shall contribute an amount equal to 8% of the Employee’s salary in equal monthly instalments in arrears to its group personal pension scheme (or such other HM Revenue and Customs (HMRC) registered group personal pension scheme as may be set up by the Company to replace its group personal pension scheme). The Company’s contributions to such scheme shall be subject to the rules of the scheme and the tax relief and exemptions available from HMRC, as amended from time to time.
|
23.2
|
The Employee may contribute an agreed percentage, but at least 1%, of the Employee’s salary, in equal monthly instalments in arrears, to the scheme. Such contributions by the Employee shall be made by way of deduction from the Employee’s salary.
|
24.
|
Reconstruction and amalgamation
|
25.
|
Notices
|
25.1
|
Any notice given under this Agreement shall be in writing and signed by or on behalf of the party giving it and shall be served by delivering it personally, or sending it by pre-paid recorded delivery or registered post to the relevant party at (in the case of the Company) its registered office for the time being and (in the case of the Employee) her last known address. Any such notice shall be deemed to have been received:
|
(a)
|
if delivered personally, at the time of delivery; and
|
(b)
|
in the case of pre-paid recorded delivery or registered post, 48 hours from the date of posting.
|
25.2
|
In proving such service it shall be sufficient to prove that the envelope containing such notice was addressed to the address of the relevant party
|
2019-4444_SR
|
Samantha Pearce
|
Page 20
|
26.
|
Entire agreement
|
(a)
|
this Agreement together with any documents referred to in it constitute the entire agreement and understanding between the Employee and the Company and any Group Company and supersedes any previous agreement between them relating to the Appointment (which shall be deemed to have been terminated by mutual consent);
|
(b)
|
in entering into this Agreement neither party nor any Group Company has relied on any Pre-Contractual Statement; and
|
(c)
|
the only remedy available to each party for breach of this Agreement shall be for breach of contract under the terms of this Agreement and no party shall have any right of action against any other party in respect of any Pre-Contractual Statement.
|
27.
|
Variation
|
28.
|
Counterparts
|
29.
|
Third party rights
|
2019-4444_SR
|
Samantha Pearce
|
Page 21
|
30.
|
Governing law and jurisdiction
|
30.1
|
This Agreement shall be governed by and construed in accordance with the law of England and Wales.
|
30.2
|
Each party irrevocably agrees to submit to the exclusive jurisdiction of the courts of England and Wales over any claim or matter arising under or in connection with this Agreement.
|
|
|
|
|
|
|
|
|
|
Signed by
|
)
|
|
Dan Swisher
|
)
|
/s/ Dan Swisher
|
on behalf of
|
)
|
|
JAZZ PHARMACEUTICALS UK LIMITED
|
)
|
|
|
|
|
|
|
|
Signed by
|
)
|
|
Samantha Pearce
|
)
|
/s/ Samantha Pearce
|
|
|
14-Dec-2019
|
2019-4444_SR
|
Samantha Pearce
|
Page 22
|
/s/ SP
|
Please initial to acknowledge receipt of this letter
|
Position
|
|
Target Bonus (Percent of Base Salary)
|
Senior Vice President who is an Executive Committee Member
|
|
45%
|
Senior Vice President who is not an Executive Committee Member
|
|
40%
|
Vice President
|
|
35%
|
Executive Director
|
|
30%
|
Senior Director
|
|
25%
|
Director
|
|
22%
|
Associate Director
|
|
20%
|
Senior Manager
|
|
18%
|
Manager
|
|
15%
|
Analyst/Senior Analyst
|
|
12%
|
Support/Senior Support
|
|
8%
|
(a)
|
the sum of the following amounts for each Participant:
|
|
|
(i) the Base Salary for such Participant, multiplied by
|
|
|
(ii) such Participant’s applicable Target Bonus;
|
|
with
|
|
|
(b)
|
the percentage set by the Board or the Compensation Committee based upon its determination of the Company’s success in achieving the objectives established by the Board or the Compensation Committee for funding the Bonus Pool for the Plan Year (the “Bonus Pool Objectives”).
|
Position
|
|
Target Bonus (Percent of Base Salary)
|
Senior Vice President who is an Executive Committee Member
|
|
45%
|
Senior Vice President who is not an Executive Committee Member
|
|
40%
|
Vice President
|
|
35%
|
Executive Director
|
|
30%
|
Senior Director
|
|
25%
|
Director
|
|
22%
|
Associate Director
|
|
20%
|
Senior Manager
|
|
18%
|
Manager
|
|
15%
|
Analyst/Senior Analyst
|
|
12%
|
Support/Senior Support
|
|
8%
|
|
(i)
|
the Base Salary for such Participant, multiplied by
|
|
(ii)
|
such Participant’s applicable Target Bonus;
|
Name
|
State/Jurisdiction of Incorporation
|
|
|
Jazz Pharmaceuticals Ireland Limited
|
Ireland
|
Jazz Financing I DAC
|
Ireland
|
Jazz Capital Ltd
|
Ireland
|
Jazz Pharmaceuticals, Inc.
|
Delaware
|
Celator Pharmaceuticals, Inc
|
Delaware
|
Jazz Pharmaceuticals Europe Holdings Limited
|
Gibraltar
|
Jazz Pharmaceuticals France SAS
|
France
|
Jazz Pharmaceuticals Lux S.à r.l.
|
Luxembourg
|
Gentium S.r.L.
|
Italy
|
Jazz Investments I Limited
|
Bermuda
|
Jazz Pharmaceuticals International Limited
|
Bermuda
|
1.
|
I have reviewed this Annual Report on Form 10-K of Jazz Pharmaceuticals public limited company;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: February 25, 2020
|
By:
|
/s/ Bruce C. Cozadd
|
|
|
Bruce C. Cozadd
Chairman, Chief Executive Officer and Director
(Principal Executive Officer and
Interim Principal Financial Officer)
|
1.
|
The Company’s Annual Report on Form 10-K for the year ended December 31, 2019, to which this Certification is attached as Exhibit 32.1 (the “Periodic Report”), fully complies with the requirements of Section 13(a) or Section 15(d) of the Exchange Act; and
|
2.
|
The information contained in the Periodic Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ Bruce C. Cozadd
|
Bruce C. Cozadd
|
Chairman, Chief Executive Officer and Director (Principal Executive Officer and
Interim Principal Financial Officer)
|
(1)
|
This certification accompanies the Annual Report on Form 10-K to which it relates, is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of Jazz Pharmaceuticals public limited company under the Securities Act of 1933, as amended, or the Exchange Act (whether made before or after the date of the Form 10-K), irrespective of any general incorporation language contained in such filing. A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 has been provided to Jazz Pharmaceuticals public limited company and will be retained by Jazz Pharmaceuticals public limited company and furnished to the Securities and Exchange Commission or its staff upon request.
|