Legal Aspects Of Outsourcing Contracts In The Pharmaceutical Industry: A Practical Guide

Paul Ranson's comprehensive report covers the contractual features of the outsourcing process from start to finish.
By: Sunil Nair
Aug. 20, 2007 - PRLog -- This report on "Legal aspects of outsourcing contracts in the pharmaceutical industry: A practical guide "includes information on the legal aspects of outsourcing services at all stages of product development, manufacturing and exploitation, including preclinical and clinical research, manufacture, logistics and sales.
By affording a background to the key legal issues in this field, this provides a manual for individuals new to outsourcing, as well as support for those familiar with the area. More than just an overview, this report is a practical guide to the process--the sections on drafting issues, documentation, negotiation and termination take readers step by step through the legal aspects of the outsourcing process.
The report includes an extensive selection of examples of the various types of outsourcing agreements. In addition there is a glossary of legal terms to assist the non-lawyer and information and specific considerations in different types of outsourcing to support contract development.
Table of contents
1. Introduction: The extent and nature of outsourcing and the procurement of services

1.1. Screening
1.1.1. Identifying targets and leads
1.1.2. Lead prioritization
1.1.3. Lead identification
1.2. Preclinical development
1.2.1. In vitro/in vivo studies
1.2.2. Chemical manufacturing controls (CMC)/pharmaceutics
1.2.3. Pharmacology/toxicology
1.3. Clinical research
1.3.1. Preparing for clinical studies
1.3.2. Phase I clinical studies
1.3.3. Phase II clinical studies
1.3.4. Phase III clinical studies
1.3.5. Post-marketing trials
1.3.6. Central laboratories
1.3.7. Enrolment
1.3.8. IVRS
1.4. Manufacturing
1.5. Logistics
1.5.1. Finished product inventory
1.5.2. Order processing, allotment and inventory management
1.5.3. Transportation
1.5.4. Import/export
1.6. Sales and marketing
1.7. Information technology, other aspects of facilities management and outsourced services
1.7.1. Information technology
1.7.2. Other outsourced facilities and services

2. Some key legal issues in outsourcing agreements

2.1. Contract law
2.1.1. Origins of contract law
2.1.2. Common and civil law Consideration Privity of contract Good faith Interpreting a contract
2.1.3. EU harmonized contract law
2.1.4. Making the contract Offer and acceptance Completeness and certainty Consideration Intention to create legal relations
2.1.5. Substance of the contract Negotiation statements Promises Implied terms Exclusion clauses
2.1.6. Ending the contract Breach Damages
2.2. Intellectual property
2.2.1. Introduction
2.2.2. Patents
2.2.3. Confidential information
2.2.4. Trade marks
2.2.5. Copyright
2.2.6. Designs
2.3. Employment issues
2.3.1. Introduction
2.3.2. Ambit of the ARD
2.3.3. Effect of the ARD
2.4. Product liability
2.4.1. Introduction
2.4.2. The Directive and negligence
2.4.3. Product
2.4.4. Producer
2.4.5. Defect
2.4.6. Damages
2.4.7. Defenses under the Act

3. Selection and due diligence

3.1. Introduction
3.2. The request for proposals
3.2.1. Introduction
3.2.2. The structure of the RFP
3.2.3. Setting the terms of the RFP
3.2.4. Due diligence Capacity and flexibility Capability Experience Financial stability Quality Control and Assurance Procedures Location Cultural fit Compliance Staff training Existing client loyalty

4. Preliminary documentation

4.1. Confidentiality agreements
4.1.1. The parties
4.1.2. Definitions
4.1.3. Obligations of the recipient
4.1.4. Further rights
4.1.5. Duration
4.1.6. Exclusions
4.1.7. Choice of law
4.2. Letters of intent/recording understandings
4.2.1. Purpose
4.2.2. Drafting issues
4.2.3. The duty to negotiate in good faith
4.3. Term sheets and heads of terms
4.4. Preferred provider agreements

5. The outsourcing agreement: General drafting issues

5.1. The role and structure of the contract
5.1.1. Introduction
5.1.2. Master agreements
5.1.3. Service level agreements
5.2. Common terms in outsourcing agreements
5.2.1. The parties
5.2.2. Recitals
5.2.3. Definitions Affiliates Applicable legislation Authorities/regulatory authorities Confidential information Effective date Improvements/inventions Intellectual property rights (IPRs) Know-how Patents Territory Trade marks
5.2.4. Interpretation
5.2.5. Appointment
5.2.6. Performance terms
5.2.7. Confidentiality
5.2.8. Ownership of data, inventions and rights
5.2.9. Publication
5.2.10. Financial or commercial terms
5.2.11. Relationship of the parties
5.2.12. Warranties, indemnities and insurance
5.2.13. Duration and termination
5.2.14. Consequences of termination
5.2.15. Force majeure
5.2.16. Assignment and sub-contracting
5.2.17. Entire agreement modification and waiver
5.2.18. Notices
5.2.19. Data protection
5.2.20. Governing law, dispute resolution and jurisdiction
5.2.21. Third party rights
5.2.22. Severance of illegal terms
5.2.23. Schedules

6. Service level terms and documents

6.1. Introduction
6.2. Service level content and language
6.3. Specifying formulae and metrics
6.4. Measuring service levels
6.4.1. Which service levels should be measured?
6.4.2. What process should be used to measure achieved performance?
6.4.3. The measurement period
6.4.4. Reports
6.4.5. Performance commitments
6.4.6. Improving service levels Continuing improvement External metrics
6.4.7. Use of service level credits
6.4.8. Service level bonuses
6.4.9. Service levels and termination

7. Successful contract drafting and negotiation

7.1. Introduction
7.2. Building in partnership
7.3. Using lawyers in negotiation and developing the agreement structure
7.4. Openness
7.5. Fairness
7.6. Building in flexibility
7.7 Providing for continuous support
7.8. Establishing disciplines
7.9. Negotiating international outsourcing agreements
7.10. Common negotiating mistakes
7.10.1. Conflict model
7.10.2. Misplaced trust
7.10.3. Fixed positions
7.10.4. Over-commitment
7.10.5. Overconfidence
7.10.6. Ignoring bargaining power

8. Specific considerations in contract manufacture

8.1. Introduction
8.2. Selection and due diligence
8.3. Creating a contract
8.4. Technical transfer
8.5. Manufacturing methods and supply
8.6. Orders and forecasts
8.7. Price and terms of sale
8.8. Acceptance/rejection of compound/product and failure to supply
8.9. Obligations of the client
8.10. Obligations of the service provider
8.11. Licenses and IP
8.12. Warranties and Indemnification
8.13. Term and termination
8.14. Miscellaneous
8.15. Technical (or quality) agreement
8.15.1. Introduction
8.15.2. Communication
8.15.3. Quality investigations
8.15.4. Production documentation
8.15.5. Batch numbering and tracking
8.15.6. Deviations
8.15.7. Visits, audits and inspections
8.15.8. Sampling and testing
8.15.9. Subcontracting
8.15.10. Complaints and recall
8.15.11. Annual product review
8.15.12. Change control
8.15.13. Final approval

9. Specific considerations in logistics

9.1. Specific contract considerations
9.1.1. Services
9.1.2. Service provider's obligations
9.1.3. Management of staff
9.1.4. Premises
9.1.5. Proprietary rights
9.1.6. Liability
9.2. Miscellaneous

10. Clinical research

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