Astellas License Agreements

9 Months Ended

Sep. 30, 2016

Astellas Out-License Agreements [Member]

8.	ASTELLAS OUT-LICENSE AGREEMENTS

In July 2011, the Company entered into license agreements with Astellas Pharma Inc., or Astellas, granting Astellas exclusive, worldwide, royalty-bearing licenses under certain of the Company's know-how and intellectual property to develop and commercialize certain products containing plasmids encoding certain forms of cytomegalovirus, glycoprotein B and/or phosphoprotein 65, including ASP0113 (TransVax™) but excluding CyMVectin™.

Under the terms of the agreements, the Company is performing research and development services and manufacturing services which are being paid for by Astellas. During the three months ended September 30, 2016 and 2015, the Company recognized $2.3 million and $4.4 million, respectively, of revenue related to these contract services. During the nine months ended September 30, 2016 and 2015, the Company recognized $9.8 million and $12.4 million, respectively, of revenue related to these contract services. The Company also recognized $1.2 million and $1.5 million in license revenue under the Astellas agreements during the nine months ended September 30, 2016 and 2015, respectively.

Astellas In-License Agreements [Member]

Astellas License Agreements

9.	ASTELLAS IN-LICENSE AGREEMENTS

In March 2015, the Company entered into license and stock purchase agreements with Astellas, pursuant to which Astellas granted the Company exclusive worldwide license to develop and commercialize a novel antifungal, VL-2397. As consideration for the rights under the license, the Company issued 861,216 shares of its common stock to Astellas and made an up-front payment of $250,000 in cash. The $250,000 cash payment and the fair value of the common stock issued of $775,094 were included in research and development expenses during the nine months ended September 30, 2015. Astellas is also eligible to receive up to $99.0 million in aggregate milestone payments, the vast majority of which are commercial and sales milestones, and single-digit royalties on net sales of commercial products.