Annual report pursuant to Section 13 and 15(d)

Material Agreements

v3.20.2
Material Agreements
12 Months Ended
Mar. 31, 2020
Text Block [Abstract]  
Material Agreements
Note 4 — Material Agreements
On December 19, 2017, RSG, a wholly owned subsidiary of RSL, entered into a license agreement (the “HanAll Agreement”) with HanAll. Under the HanAll Agreement, RSG received (1) the
non-exclusive
right to manufacture and (2) the exclusive, royalty-bearing right to develop, import, use and commercialize the antibody referred to as IMVT-1401 and certain
back-up
and next-generation antibodies, and products containing such antibodies, in the United States, Canada, Mexico, the European Union, the United Kingdom, Switzerland, the Middle East, North Africa and Latin America (the “Licensed Territory”).
In exchange for this license, RSG provided or agreed to provide the following consideration:
 
   
Upfront,
non-refundable
payment of $30.0 million;
 
   
Up to $20.0 million in shared (50%) research, development, and
out-of-pocket
costs incurred by HanAll;
 
   
Up to an aggregate of $452.5 million upon the achievement of certain development, regulatory and sales milestones; and
 
   
Tiered royalties ranging from the
mid-single
digits to
mid-teens
on net product sales subject to reduction on a
product-by-product
and
country-by-country
basis, until the later of (1) expiration of patent and regulatory exclusivity or (2) the 11th anniversary of the first commercial sale of such product in such country.
Since the acquisition of IMVT-1401, RSL and the Company have performed all the development associated with IMVT-1401 and no amounts were incurred by HanAll to research or develop the technology for the years ended March 31, 2020 and 2019.
On August 18, 2018, RSG entered into a sublicense agreement (the “Sublicense Agreement”) with ISG to sublicense this technology, as well as RSG’s knowhow and patents necessary for the development, manufacture or commercialization of any compound or product that pertain to immunology. On December 7, 2018, RSG issued a notice to terminate the Sublicense Agreement with ISG and entered into the Assignment and Assumption Agreement to assign to ISG all the rights, title, interest, and future obligations under the HanAll Agreement from RSG, including all rights to IMVT-1401 from RSG in the Licensed Territory, for an aggregate purchase price of
$37.8 
million. As a result of the assignment of IMVT-1401 by RSG to ISG, the Company recorded a Swiss value-added tax receivable of
$3.0 million and $2.9 million as of March 31, 2020 and 2019, respectively and is reflected as a capital contribution from RSL as of March 31, 2020.
In May 2019, the Company achieved its first development and regulatory milestone under the HanAll Agreement which resulted in a $10.0 million milestone payment that the Company subsequently paid in August 2019. The milestone payment was recorded as research and development expense in the accompanying combined and consolidated statements of operations for the year ended March 31, 2020.