Annual report pursuant to Section 13 and 15(d)

License Agreements

v3.19.1
License Agreements
12 Months Ended
Dec. 31, 2018
License Agreements [Abstract]  
License Agreements

9.

License Agreements


·

University of Miami


·

Beginning in 2008, the Company has entered into various agreements with the University of Miami (UM) for intellectual and tangible property rights relating to the ImPACT®, technology activities (License Agreement 03-31, 05-39 and “License Agreement 97-14”, or collectively “License Agreements”). These license agreements were subsequently assigned to the Company’s subsidiary Heat Biologics I, Inc. (Heat I) which issued to UM shares of its common stock representing seven and one-half percent (7.5%) of its common stock. The term of the license is the length of the last to expire patent, unless terminated earlier.

 

·

The Company agreed to make minimum royalty payments of $10,000 for three years beginning in 2010 that are due on the anniversary date of the agreement for License Agreement 97-14. Beginning in 2013, and thereafter for the life of the agreement, the minimum royalty payment shall be $20,000 due on the same date. In July 2016, the Company and UM entered into an amendment which replaced the milestone payment of $250,000 by approval of a BLA for the lung cancer vaccine with a payment of $500,000 upon approval of an NDA for a lung cancer vaccine covered by Patent Rights.


·

In August 2009, Heat I and UM entered into a second amendment (Amendment 2) to License Agreement 97-14 to extend the foregoing payment due dates for all past due license fees and patent costs.


·

On February 18, 2011, Heat I entered into a license agreement (“SS114A”) with UM to obtain additional technology related to License Agreement 97-14. Heat I agreed to reimburse UM for all past patent costs of $37,381. As partial consideration for SS114A, Heat II agreed to grant back certain exclusive rights to UM.


·

On February 18, 2011, Heat I entered into a license agreement (143) with UM to obtain additional technology related to License Agreement 97-14. In consideration for 143, Heat I agreed to pay UM a fee of $50,000 and reimburse them for past patent costs of $14,158.


·

On February 18, 2011, Heat I entered into a license agreement (J110) with UM to obtain additional technology related to License Agreement 97-14. In consideration for J110, Heat I agreed to pay UM a fee of $10,000 and reimburse them for past patent costs of $1,055.


·

In addition, Heat entered into an agreement for Modified Heat Shock Proteins-Antigenic Peptide Complex with UM in September 2014 for a cancer cell line where UM agreed not to license the cell line to third parties while the Company is in good standing and in compliance of its patent license agreements with UM relating to our ImPACT® platform. There is no financial obligation on the Companys part under the arrangement.


·

On October 25, 2016, the Company entered into an exclusive license agreement with UM for the license and development of intellectual property related to its gp96 platform to target the Zika virus and other infectious diseases. As consideration for the rights granted in this license agreement the Company is obligated to pay UM an upfront license fee of $20,000 and nominal annual maintenance fees over the initial ten years that total $82,000 and increasing thereafter. The Company is obligated to pay royalties equal to a percentage (mid-single digits) of net sales of products covered by the patent-relayed rights, subject to reduction if additional licenses from third parties are required to commercialize licensed products.


·

University of Miami - Pelican


For each agreement, the Company agreed to make minimum royalty payments of $10,000 for three years beginning 2010 due on the anniversary date of the agreements to the University of Miami. Beginning in 2013, and thereafter for the life of the agreements, the minimum royalty payments shall be $20,000 due on the same date.


License 03­31, 05­39


·

Pelican is obligated to make milestone payments as follows: $150,000 due upon submission and approval of an IND and the completion of a Phase 1 clinical trial and $250,000 due upon the earlier of May 2022 or approval of an NDA. The Company has the right to terminate this Agreement without obligation for future unpaid milestones.


·

In August 2009, Pelican and UM entered into a second amendment (Amendment 2) to License Agreement 03­31, 05­39 to extend the foregoing payment due dates for all past due license fees and patent costs.


·

In February 2010, Pelican and UM entered into a third amendment (Amendment 3) to License Agreement 03­31, 05­39 to grant back to UM a certain non­exclusive license. In all other respects, the original agreement remained the same.

 

·

In October 2010, Pelican and UM entered into a fourth amendment (Amendment 4) to License Agreement 03­31, 05­39 to grant to the licensor a non­exclusive license right for certain technology as research reagents and research tools.


License I­176


·

On December 12, 2010, Pelican entered into another license agreement (I­176) with UM for one component of complimentary technology to the July 11, 2008 agreement. Pelican agreed to pay UM a license fee of $50,000 and a reimbursement of $15,797 for past patent fees. Pelican also agreed to make a minimum royalty payment of $10,000 during 2012 through 2014 and then $20,000 every year thereafter. Pelican is obligated to make milestone payments as follows: $150,000 due upon submission and approval of an IND and the completion of a Phase 1 clinical trial and $500,000 due upon the earlier of May 2022 or approval of an NDA. The Company has the right to terminate this Agreement without obligation for future unpaid milestones.


·

In August 2012, Pelican and UM entered into a second amendment (I­176 Amendment 2) to License Agreement I­176 to extend the foregoing payment due dates for all past due license fees and patent costs.


UMM­143


·

On November 19, 2013, Pelican entered into another license agreement (“UMM­143”) with UM for an exclusive license of complimentary technology and patent rights. Pelican agreed to pay UM a license issue fee of $35,000, and agreed to make minimum royalty payments if the I­176 license agreement is terminated. No minimum royalty payments or milestone payments are due for any year in which the I­176 license agreement is in force. The Company has the right to terminate this Agreement without obligation for future unpaid milestones.


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Other License Agreements


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On April 12, 2011, Heat entered into a non-exclusive evaluation and biological material license agreement with a not-for-profit corporation for evaluation and production of vaccines. In consideration for the evaluation and commercial use license, Heat agreed to pay the not-for-profit corporation a fee of $5,000 and $50,000, respectively. Heat has the option to renew the license once the original term has expired.  Milestone payments are due upon certain events agreed upon by Heat and the not-for-profit corporation. In December 2015, Heat amended the evaluation and biological material license agreement to add additional cell lines in exchange for a one-time payment of $1,000.


·

On August 30, 2010, Heat entered into an option agreement with the University of Michigan (University) to acquire the right to negotiate an exclusive license for certain materials which include cancer cells and all unmodified derivatives of these cells. An option fee of $2,000 was paid on September 8, 2010 to grant a period of nine months for this consideration. In July 2011, the Company exercised the option to acquire the license for $10,000.


·

In June 2016, the Company entered into an exclusive license agreement with Shattuck Labs, Inc. (“Shattuck”) pursuant to which the Company licensed certain provisional patent applications and know-how related to fusion proteins to treat cancer and other diseases that were not being developed by us. Shattuck paid the Company an initial license fee of $50,000 and is obligated to pay the Company fees upon its receipt of sublicensing income, achievement of certain milestones and royalties upon sales of commercial products. Inasmuch as the technology that the Company out-licensed is in the early stages of development and there is a low likelihood of success for any technology at such stage, there can be no assurance that any products will be developed by Shattuck or that we will derive any revenue from Shattuck.


 

Future minimum royalty payments by the Company for licenses as of December 31, 2018 are as follows (in thousands):


Year ended December 31,

 

 

 

 

 

 

 

2019

 

$

74

 

2020

 

 

103

 

2021

 

 

228

 

2022

 

 

784

 

2023

 

 

74

 

Total

 

$

1,263