License and Collaboration Agreements |
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License And Collaboration Agreements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
License and Collaboration Agreements |
The following table summarizes the impact of the research and development costs related to the collaboration and license agreements on the Company’s consolidated statements of operations and comprehensive loss for the three and six months ended June 30, 2020 and 2021. For details on the structure and accounting treatment for the Company’s collaboration and license agreements, refer to the annual consolidated financial statements and notes contained in the 2020 Form 10-K.
Pearl—Zai Lab License Agreement In December 2020, Pearl entered into a license agreement (Zai License Agreement) with Zai Lab Shanghai Company, Limited (Zai Lab), to grant Zai Lab, an exclusive royalty-bearing license to research, develop, commercialize and manufacture CLN-081 and products which contain CLN-081 in China, Hong Kong, Macau and Taiwan. Zai will be primarily responsible for substantially all the costs related to the operations and control over the significant activities related to the exploitation of the licensed IP. As partial consideration of the license and rights granted to Zai Lab, Zai Lab paid Pearl a one-time, irrevocable, nonrefundable license fee of $20.0 million in January 2021. In addition to the upfront fee, Zai Lab will be obligated to pay Pearl, research and development, regulatory and sales milestone payments upon the occurrence of certain milestone events in the aggregate amount of up to $211.0 million, and tiered royalty payments based on the annual net sales of the licensed product. The Company recognized the upfront license fee in revenue. The Company will also recognize milestone and royalty payments in revenue once they are earned. No milestones have been achieved to date under the Zai License Agreement. The upfront payment received by Pearl was subject to foreign tax withholdings. When the licensed IP and technology know-how was transferred to Zai Lab in January 2021, Pearl recognized revenue of $18.9 million, which represented the upfront fee less the foreign tax withholdings as Pearl does not expect to recover the amounts relating to the foreign tax withholdings. In connection with the Taiho License Agreement, Pearl is obligated to pay Taiho Pharmaceutical, Co., Ltd. (Taiho Pharma) a percentage of future revenue received from Zai Lab, including the upfront payment that was received in January 2021. Upon receipt of the upfront payment, Pearl recognized $3.0 million within research and development expenses in the consolidated statements of operations and comprehensive loss. |