On June 16, 2021, Ocuphire Pharma, Inc. ("Ocuphire") reported that entered into a License Agreement (the "License Agreement") with Processa Pharmaceuticals, Inc. ("Processa"), pursuant to which Ocuphire granted Processa an exclusive license to develop, manufacture and commercialize RX-3117 globally, excluding China (Filing, 8-K, Rexahn, JUN 16, 2021, View Source [SID1234584277]).
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As consideration for the License Agreement, Ocuphire will receive 44,689 shares of Processa common stock and a $200,000 cash payment. As additional consideration, Processa will pay Ocuphire development and regulatory milestone payments upon the achievement of certain milestones, which primarily consist of dosing a patient in pivotal trials or having a drug indication approved by a regulatory authority in the United States or another country. In addition, Processa must pay Ocuphire one-time sales milestone payments based on the achievement during a calendar year of one or more thresholds for annual sales for products made and pay royalties based on annual licensing sales. Processa is also required to give 32% of any milestone payments received to Ocuphire based on any sub-license agreement it may enter into with respect to the Licensing Agreement.
Processa is required to use commercially reasonable efforts, at its sole cost and expense to oversee such commercialization efforts, to research, develop and commercialize products in one or more countries, including meeting specific diligence milestones that consist of: (i) first patient administered drug in a clinical trial of a licensed product prior to the three (3) year anniversary of the effective date; and (ii) first patient administered drug in a pivotal clinical trial of a licensed product or first patient administered drug in a clinical trial for a second indication of a licensed product prior to the five (5) year anniversary of the effective date. Either party may terminate the agreement in the event of a material breach of the agreement that has not been cured following written notice and a 120-day opportunity to cure such breach, and Processa may terminate the agreement for any reason upon 120 days prior written notice to Ocuphire.