Table of Contents
Notes to Consolidated Financial Statements (Continued)
5. Collaboration and License Agreements (Continued)
Asklepios Biopharmaceutical, Inc. License (unaudited)
On May 29, 2015, the Company and Asklepios Biopharmacueitcal, Inc. ("AskBio") entered into a Non-Exclusive License
Agreement (the "AskBio License"). Under the terms of the AskBio License, AskBio granted the Company a non-exclusive, non-transferable, worldwide license to certain patents and know how held by AskBio.
consideration for the AskBio License, the Company agreed to make a $1,000,000 up-front payment (the "AskBio Up-front Payment"), with $300,000 of such amount payable within thirty
days of the effective date of the AskBio License, $300,000 payable within thirty days following the dosing of the first patient in the ongoing Phase 1 clinical trial of the Product Candidate
and $400,000 payable upon the dosing of the ninth patient in the clinical trial, as well as potential future milestone payments aggregating $9,600,000, and a tiered royalty on net sales, if any, of
the Company's Product Candidate, on a country-by-country basis, starting at percentages in the low-single digits and increasing to mid-single digits. These royalty rates are subject to potential
reduction in specified circumstances, including, in the event the Company exercises its option to make a specified one-time royalty option fee payment to AskBio. The Company must also pay AskBio a low
double digit percentage of all consideration the Company receives from any sublicense of the licensed technology.
the Company agreed to pay an annual maintenance fee of $50,000 on each anniversary of the effective date of the AskBio License.
rights granted to the Company under the AskBio License represent distinct components that need to be combined with other licensed intellectual property and know-how in order to
complete the clinical development of AVXS-101. Additionally, the Company did not acquire any employees or manufacturing capabilities in connection with the AskBio License. As a result, the Company
accounted for the AskBio License as an asset acquisition.
AskBio Up-front Payment of $1,000,000 and accrued annual maintenance fees of $16,941 are included in research and development expense for the nine months ended September 30,
AskBio License term continues until the last valid patent claim expires or lapses in all countries of the world. Additionally, the Company may terminate the AskBio License at any
time upon six months' notice and AskBio may terminate upon the breach or insolvency of the Company.
AskBio may terminate the AskBio License in the event the Company (i) researches, develops or commercializes any AAV-based treatment for hemophilia or
(ii) undergoes a change in control or is otherwise acquired by a third party that researches, develops or commercializes any AAV-based treatment for hemophilia, in each case, until
April 1, 2019 unless such change in control is first approved by AskBio, such approval not to be unreasonably withheld if the party in control following such a change of control event agrees to
additional restrictive measures as reasonably proposed by AskBio in its sole discretion prior to such change of control respecting the use of the AskBio licensed technology.