On April 19, 2023, the Company reported to have entered into an Asset Purchase Agreement (the "Purchase Agreement") with Blue Water Vaccines Inc. (the "Purchaser"). Pursuant to, and subject to the terms and conditions of, the Purchase Agreement, the Purchaser purchased substantially all of the assets related to the Company’s ENTADFI business (Filing, Veru, APR 19, 2023, View Source [SID1234630360]). The transaction closed on April 19, 2023. The purchase price for the transaction was $20.0 million, consisting of $6.0 million paid at closing, an additional $4.0 million the Purchaser is obligated to pay the Company in the Company’s fiscal year 2023 and an additional $10 million the Purchaser is obligated to pay the Company in installments in the Company’s fiscal year 2024, plus up to an additional $80 million based on the Purchaser’s net sales from ENTADFI business after closing (the "Milestone Payments "). The Milestone Payments are payable as follows: (1) $10 million is payable if annual net sales from the ENTADFI business are $100 million or more, (2) $20 million is payable if annual net sales from the ENTADFI business are $200 million or more and (3) $50 million is payable if annual net sales from the ENTADFI business are $500 million or more. No more than one Milestone Payment shall be made for the achievement of each net sales milestone. There can be no assurance that the net sales milestones for payment of any of the Milestone Payments will be reached.

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

Furthermore, in connection with the transaction, the Purchaser assumed royalty and milestone obligations from the Company under an asset purchase agreement relating to the Company’s acquisition of the tadalafil-finasteride combination, which include a 6% royalty on all sales of tadalafil-finasteride and sales milestone payments of up to $22.5 million.

The Company and the Purchaser made customary representations and warranties, and agreed to certain customary covenants, in the Purchase Agreement. Subject to certain exceptions and limitations, each party has agreed to indemnify the other for breaches of representations, warranties and covenants and for certain other matters.

The description of the Purchase Agreement set forth herein is qualified in its entirety by reference to the full text of the Purchase Agreement, a copy of which is attached as Exhibit 10.1 hereto and incorporated by reference herein.