SPONSORED RESEARCH AND LICENSE AGREEMENTS AND GOVERNMENT CONTRACTS |
12 Months Ended |
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Dec. 31, 2025 | |
| SPONSORED RESEARCH AND LICENSE AGREEMENTS AND GOVERNMENT CONTRACTS [Abstract] | |
| SPONSORED RESEARCH AND LICENSE AGREEMENTS AND GOVERNMENT CONTRACTS | SPONSORED RESEARCH AND LICENSE AGREEMENTS AND GOVERNMENT CONTRACTS Sponsored Research and License Agreements
We conduct research and development programs independently and in connection with our corporate collaborators. We are a party to collaboration agreements with Lilly to develop and commercialize ocadusertib (previously R552), a RIPK1 inhibitor; with Grifols to commercialize fostamatinib for human diseases in all indications, in Grifols territory which includes Europe, the UK, Turkey, the Middle East, North Africa and Russia (including Commonwealth of Independent States); with Kissei to develop and commercialize fostamatinib in Japan, China, Taiwan and Korea and olutasidenib in Japan, Korea and Taiwan; with Medison to commercialize fostamatinib in all indications, in Medison territory which includes Canada and Israel; with Knight to commercialize fostamatinib in all indications, in Knight territory which includes Latin America, consisting of Mexico, Central and South America, and the Caribbean; and with Dr. Reddy’s to commercialize olutasidenib in Dr. Reddy’s territory which includes Latin America, South Africa, India, Australia, New Zealand, and certain countries in the CIS, Southeast Asia region and North Africa.
Further, we are also a party to collaboration agreements, but do not have ongoing performance obligations with BerGenBio for the development and commercialization of AXL receptor tyrosine kinase inhibitor, R428 (now referred to as bemcentinib (BGB324)), and with Daiichi to pursue research related to MDM2 inhibitor, DS-3032 (now referred as milademetan).
Under the above existing agreements that we entered into in the ordinary course of business, we received or may be entitled to receive upfront cash payments, payments contingent upon specified events achieved by such partners and royalties on any net sales of products sold by such partners under the agreements. As of December 31, 2025, total potential future contingent payments due to us under all existing collaboration agreements was approximately $1.1 billion, which amount reflects the impact of Lilly's termination of the CNS disease program effective in November 2025, and assumes that all potential product candidates achieve every payment-triggering milestone under all of our current agreements. Of this amount, approximately $179.5 million relates to the achievement of development events, $270.6 million relates to the achievement of regulatory events and $637.0 million relates to the achievement of certain commercial or launch events. This estimated future contingent amount does not include any estimated royalties that could be due to us if the partners successfully commercialize any of the licensed products. Future events that may trigger payments to us under the agreements are based solely on our partners’ future efforts and achievements of specified development, regulatory and/or commercial events.
We account for the milestone payments when such milestones are considered probable of being achieved, and estimate the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within our or the licensee’s control, such as regulatory approvals, are not considered probable of being achieved until uncertainty associated with the approvals has been resolved. The transaction price is then allocated to each performance obligation, on a relative standalone selling price basis, for which we recognize revenue as or when the
performance obligations under the contract are satisfied. At the end of each subsequent reporting period, we re-evaluate the probability of achieving such milestones and any related constraint, and if necessary, adjust our estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, and recorded as part of contract revenues from collaborations during the period of adjustment.
Global Exclusive License Agreement with Lilly
In February 2021, we entered a global exclusive license agreement and strategic collaboration with Lilly, which became effective in March 2021 upon clearance under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, and was amended in September 2023 (first amendment), March 2024 (second amendment), and in August 2025 (third amendment) (collectively, Lilly Agreement). The collaboration was to develop and commercialize ocadusertib (previously R552) for the treatment of non-CNS diseases, and additional RIPK1 inhibitors for the treatment of CNS diseases. Pursuant to the terms of the Lilly Agreement, we granted Lilly the exclusive rights to develop and commercialize ocadusertib and related RIPK1 inhibitors in all indications worldwide. The parties’ collaboration is governed through a joint governance committee and appropriate subcommittees.
Under the terms of Lilly Agreement, we received a non-refundable and non-creditable upfront cash payment amounting to $125.0 million in April 2021. In addition, for non-CNS diseases, we are eligible to receive up to $330.0 million in milestone payments upon the achievement of specified development and regulatory milestones and up to $100.0 million in sales milestone payments on a product-by-product basis. In addition, depending on the extent of our co-funding of ocadusertib development activities, we would be entitled to receive tiered royalty payments on net sales of non-CNS disease products at percentages ranging from the mid-single digits to high-teens, subject to certain standard reductions and offsets. For CNS diseases, we were eligible to receive up to $256.0 million in milestone payments upon the achievement of specified development, regulatory and commercial milestones and up to $150.0 million in sales milestone payments on a product-by-product basis. In addition, we were also eligible to receive tiered royalty payments on net sales of CNS disease products up to low-double digits, subject to certain standard reductions and offsets. On October 1, 2025, Lilly notified us of its intent to terminate the CNS disease program under the Lilly Agreement, and such termination became effective on November 30, 2025. As a result, we do not expect to realize any future milestones and royalty payments associated with the CNS disease program.
Under the Lilly Agreement, we were responsible for performing and funding initial discovery and identification of CNS disease development candidates. Following candidate selection, Lilly was responsible for performing and funding all future development and commercialization of the CNS disease development candidates. Under the Lilly Agreement, we were responsible for 20% of development costs for ocadusertib in the US, Europe, and Japan, up to a specified cap. Lilly was responsible for funding the remainder of all development activities for ocadusertib and other non-CNS disease development candidates. Pursuant to the terms of the Lilly Agreement, we had the right to opt-out of co-funding the ocadusertib development activities in the US, Europe and Japan at two different specified times and as a result receive lesser royalties from sales. Prior to us providing our first opt-out notice in September 2023 as discussed below, under the Lilly Agreement, we were required to fund our share of the ocadusertib development activities in the US, Europe, and Japan up to a maximum funding commitment of $65.0 million through April 1, 2024.
We accounted for this agreement under ASC 606. At the inception of the Lilly Agreement, we determined that the license of non-CNS penetrant IP and the license of CNS penetrant IP represented distinct performance obligations. Given our opt-out rights related to ocadusertib development activities, we concluded at the minimum, we had a commitment to fund the development costs up to $65.0 million. We determined that this commitment represented a significant financing component of the contract and accounted for as a reduction of the upfront payment in determining the transaction price. Accordingly, we recorded a liability at its net present value of approximately $57.9 million using a 6.4% discount rate. Interest expense was accreted on such liability over the expected commitment period and adjusted for timing of expected cost share payments. The resulting net transaction price of $67.1 million was allocated to each performance obligation based on our best estimate of its relative standalone selling price using the adjusted market assessment approach. The portion of the transaction price allocated to the non-CNS penetrant IP of $60.4 million was recognized as revenue in 2021 upon delivery of the non-CNS penetrant IP to Lilly. The portion of the transaction price allocated to the CNS penetrant IP of $6.7 million was recognized as revenue from the effective date of the Lilly Agreement through the eventual acceptance by Lilly in June 2022 using the input method. There was no outstanding deferred revenue related to Lilly Agreement as of December 31, 2025 and 2024.
In September 2023, we provided our first opt-out notice to Lilly, and concurrently entered into an amendment to the Lilly Agreement. Under the amended agreement, following the exercise of the first opt-out, we had the right to opt back in to co-funding of ocadusertib development activities, upon us providing notice to Lilly within 30 days of certain events as specified in the Lilly Agreement, which would have entitled us to higher royalties. If we had exercised this opt-in right, we
would have been required to continue to share in global development costs, subject to cap and duration if the second opt-out right were exercised.
Following the exercise of our first opt-out right, our cost share obligation for ocadusertib development activities ended on April 1, 2024. We paid Lilly $21.4 million for our share of development costs incurred through April 1, 2024. As of December 31, 2024, the outstanding liability to Lilly reported within other long-term liabilities in the balance sheets amounted to $40.0 million. Although our obligation to share in ocadusertib development activities ended on April 1, 2024, we did not release the remaining cost share liability in the periods prior to providing notice that we would not exercise our opt-in right, as we could not conclude that it was probable that a significant reversal of revenue, if recognized, would not occur until the likelihood of us exercising our opt-in right became remote, or the opt-in period lapsed.
On April 30, 2025, we notified Lilly of our decision not to exercise our opt-in right following our evaluation of certain events specified in the Lilly Agreement. As a result, we were no longer obligated to share in any future global development costs for ocadusertib development activities. Accordingly, during the year ended December 31, 2025, we released the remaining $40.0 million cost share liability and recognized the amount as contract revenues from collaboration.
Grifols License Agreement
We have a commercialization license agreement with Grifols entered in January 2019 with exclusive rights to commercialize fostamatinib for human diseases, and non-exclusive rights to develop, fostamatinib in Grifols territory. Under the agreement, we received an upfront payment of $30.0 million, with the potential for $297.5 million in total regulatory and commercial milestones. We are also entitled to receive stepped double-digit royalty payments based on tiered net sales which may reach 30% of net sales. In January 2020, the EC granted a centralized MA for fostamatinib valid throughout the EU, and in the UK after the departure of the UK from the EU, for the treatment of chronic ITP in adult patients who are refractory to other treatments. With this approval, in February 2020, we received $20.0 million non-refundable payment, consisted of a $17.5 million payment due upon MAA approval by the EMA of fostamatinib for the first indication and a $2.5 million creditable advance royalty payment, based on the terms of our collaboration agreement with Grifols. We accounted for this agreement under ASC 606 and recognized the corresponding revenue in the period we satisfied the performance obligations. As of December 31, 2025 and 2024, there was no outstanding deferred revenue.
We have a Commercial Supply Agreement with Grifols entered in October 2020 to supply and sell our drug product priced at a certain markup specified in the agreement, in quantities Grifols shall order from us pursuant to and in accordance with the agreement. For the years ended December 31, 2025, 2024, and 2023, we recognized $6.1 million, $4.0 million and $5.6 million, respectively, of revenue related to delivery of drug supply to Grifols.
We recognized royalty revenue from Grifols of $7.2 million, $5.1 million and $3.2 million for the years ended December 31, 2025, 2024 and 2023, respectively.
Kissei License Agreements
We have a collaboration and license agreement with Kissei entered in September 2024 to grant exclusive rights to develop and commercialize olutasidenib in all human diseases in Japan, Korea and Taiwan. Kissei is responsible for performing and funding the development activities for olutasidenib in the Kissei territory and we retained the co-exclusive right to conduct development activities in the Kissei territory solely for the purpose of supporting and obtaining regulatory approval of and commercializing olutasidenib in the world outside the Kissei territory. Under the terms of the agreement, we received a one-time, non-refundable, and non-creditable upfront cash payment of $10.0 million, with the potential for up to an additional $152.5 million in development, regulatory and commercial milestone payments, and will receive mid twenty to lower thirty pecent, tiered, escalated net sales-based payments for the supply of olutasidenib, subject to certain standard reductions and offsets. Pursuant to the agreement, Kissei is responsible for companion diagnostic development in Japan, for which we will share 50% of the costs incurred by Kissei, up to $3.0 million, which are creditable against future milestones and transfer price payments owed to us. We remain responsible for the manufacture and supply of olutasidenib for all development and commercialization activities under the agreement. Pursuant to the concurrently executed supply agreement, we will supply Kissei with bulk drug product for use under the collaboration and license agreement. We accounted for this agreement following ASC 606 and concluded at the inception of the agreement, the upfront cash payment of $10.0 million was the consideration for granting the license right to Kissei, and there are no other material deliverables associated with the upfront payment. Accordingly, we recognized the upfront payment as revenue during the year ended December 31, 2024.
Under the license and services agreement with Forma as discussed in “Note 5 – In-Licensing and Acquisition”, Forma is entitled to a certain portion of sublicensing revenue, which include, but are not limited to, upfront payments, milestone payments and royalties, that we receive from a third party sublicensee. Following the collaboration and license agreement with Kissei as discussed above, Forma is entitled to a portion of the sublicensing revenue we receive from Kissei. With the receipt of the upfront payment from Kissei, we recognized a $2.3 million sublicense revenue fee payable to Forma during the year ended December 31, 2024, which we recorded within cost of product sales.
We also have an exclusive license and supply agreement with Kissei entered in October 2018, amended in November 2022, October 2023, August 2024, September 2024 and October 2024, to develop and commercialize fostamatinib in all current and potential indications in Japan, China, Taiwan and Korea. Kissei is responsible for performing and funding all development activities for fostamatinib in Kissei territories. At the inception of the agreement, we received an upfront cash payment of $33.0 million. Further, the agreement provides for up to $115.0 million in potential development, regulatory and commercial milestone payments, and will receive mid- to upper twenty percnt, tiered, escalated net sales-based payments for the supply of fostamatinib. Under the agreement, we granted Kissei the license rights to fostamatinib in Kissei territory and are obligated to supply Kissei with drug product for use in clinical trials and pre-commercialization activities. We are also responsible for the manufacture and supply of fostamatinib for all future development and commercialization activities. In April 2022, Kissei announced that an NDA was submitted to Japan’s PMDA for fostamatinib in chronic ITP, which entitled us to receive a $5.0 million non-refundable and non-creditable milestone payment. In December 2022, Kissei announced that Japan’s PMDA approved the NDA for fostamatinib in chronic ITP, which entitled us to receive a $20.0 million non-refundable and non-creditable milestone payment. In January 2025, Kissei announced the Korean Ministry of Food and Drug Safety approved fostamatinib for the treatment of chronic ITP, which entitled us to receive a $3.0 million non-refundable and non-creditable milestone payment. We accounted for this agreement under ASC 606, and recognized the corresponding revenue in the period we satisfied the performance obligations. As of December 31, 2025 and 2024, the remaining deferred revenue was related to the material right associated with discounted fostamatinib supply, which amounted to $1.4 million.
Pursuant to our supply agreement with Kissei, during the years ended December 31, 2025, 2024 and 2023, we recognized $4.2 million, $10.4 million, and $2.2 million, respectively, of revenue related to delivery of drug supplies to Kissei.
Medison Commercial and License Agreements
We have exclusive commercial and license agreements with Medison entered in October 2019 for the commercialization of fostamatinib for chronic ITP in Medison territory. Pursuant to which, we received a $5.0 million upfront payment with respect to the agreement in Canada. We accounted for this agreement under ASC 606 and recognized the revenue in the period we satisfied the performance obligation. There was no outstanding deferred revenue related to Medison commercial and license agreement as of December 31, 2025 and 2024.
During the years ended December 31, 2025, 2024 and 2023, we recognized $1.1 million, $0.5 million, and $0.5 million, respectively, of revenue from Medison primarily related to the delivery of drug supplies and earned royalties.
Knight Commercial License and Supply Agreement
We have commercial license and supply agreements with Knight entered in May 2022 for the exclusive commercialization of fostamatinib for approved indications in Knight territory. Pursuant to such commercial license agreement, we received a $2.0 million one-time, non-refundable, and non-creditable upfront payment, with potential for up to an additional $20.0 million in regulatory and sales-based commercial milestone payments, and will receive twenty- to mid-thirty percent, tiered, escalated net-sales based royalty payments for products sold in the Knight territory. We are also responsible for the exclusive manufacture and supply of fostamatinib for all future development and commercialization activities under the agreement. We accounted for this agreement under ASC 606 and recognized the revenue in the period we satisfied the performance obligation. There was no outstanding deferred revenue as of December 31, 2025 and 2024, and no revenue was recognized during the years ended December 31, 2025, 2024 and 2023 related to commercial and license agreement with Knight.
Dr. Reddy’s Commercial License Agreement
We have a commercial license agreement with Dr. Reddy’s entered in November 2024, pursuant to which, we granted Dr. Reddy’s an exclusive license to develop and commercialize olutasidenib in Dr. Reddy’s territory. Pursuant to the commercial license agreement, we were entitled to receive a $4.0 million one-time, non-refundable and non-creditable upfront payment, which amount, net of applicable foreign withholding taxes was received in February 2025. In addition, we are also entitled to a potential for up to an additional $36.0 million in regulatory and sales-based commercial milestone payments, and will receive high teens- to thirty percent, tiered, escalated net-sales based royalty payments for products sold in Dr. Reddy’s territory, subject to certain standard reductions and offsets. Dr. Reddy’s is responsible for performing and funding all development activities necessary to obtain regulatory approval and commercialize olutasidenib in the Dr. Reddy’s territory. We are responsible for the exclusive manufacture and supply of olutasidenib for all future development and commercialization activities under the agreement. We accounted for this agreement following ASC 606 and concluded at the inception of the agreement that the upfront cash payment of $4.0 million was the consideration for granting the license right to Dr. Reddy’s, and accordingly recognized the upfront payment as revenue during the year ended December 31, 2024. In August 2025, we entered into a supply agreement with Dr. Reddy’s. During the year ended December 31, 2025, we recognized $0.1 million of revenue related to the delivery of drug supplies.
Under the license and services agreement with Forma as discussed in “Note 5 – In-Licensing and Acquisition”, Forma is entitled to a certain portion of sublicensing revenue from olutasidenib. During the year ended December 31, 2024, we recorded $0.9 million sublicense revenue fee which we recorded within cost of product sales, associated with the upfront payment from Dr. Reddy’s.
Government Contracts
Government contracts revenue of $0.3 million for the year ended December 31, 2025 was related to an award granted to us by BARDA for our evaluation of fostamatinib in mitigating the impact of long-term respiratory distress. No government contracts revenue was recognized during the year ended December 31, 2024. revenue of $1.1 million for the year ended December 31, 2023 was primarily related to an award granted to us by the Department of Defense to support our Phase 3 clinical trial to evaluate the safety and efficacy of fostamatinib for the treatment of hospitalized high-risk patients with COVID-19.
Strategic Development Collaborations with MD Anderson and CONNECT
We have a Strategic Collaboration Agreement with MDACC, a comprehensive cancer research, treatment, and prevention center, entered in December 2023. The collaboration will expand our evaluation of olutasidenib in AML and other hematologic cancers. Under the collaboration, we will provide MDACC the study materials and $15.0 million in time-based milestone payments as compensation for services to be provided for the studies, over the five-year collaboration term, unless terminated earlier as provided for in the agreement. Through December 31, 2025, we provided $5.3 million funding to MDACC.
In January 2024, we announced our collaboration with CONNECT, an international collaborative network of pediatric cancer centers, to conduct a Phase 2 clinical trial to evaluate olutasidenib in glioma. Under the collaboration, we will provide funding up to $3.0 million and study material over the four-year collaboration. We account for the funding we provide under the above research collaboration agreements as prepaid research and development in the balance sheet to the extent the payment is made in advance of services being rendered, and recognize such amount as research and development expense within the statements of operations as the collaborative partners render the services under the respective agreement.
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