Tuesday, January 24, 2023
RespireRx Pharmaceuticals Inc., a leader in the discovery and development of innovative and revolutionary treatments to combat diseases caused by disruption of neuronal signaling, is pleased to announce that the Company and the Board of Trustees of University of Illinois, a body corporate and politic of the State of Illinois (“UIL”), have agreed to a second amendment (“Second Amendment”) to their Exclusive License Agreement (“License Agreement”). The License Agreement is effective June 27, 2014 and was amended on August 2, 2017. The Second Amendment is effective December 15, 2022 and was signed by RespireRx and UIL on January 3, 2023 and January 18, 2023 respectively.
The parties entered into the Second Amendment in order to eliminate accrued financial obligations to UIL and reduce future obligations. Annual $100,00 payments by the Company to UIL are eliminated and the unpaid amount of $200,000 for calendar years 2021 and 2022 are no longer due and payable. The $75,000 payment that was due after the dosing of the 1st patient in a Phase II study anywhere in the world is now reduced to $10,000.
In consideration of these changes and the changes described below as well as others, UIL has been given an extension in the term of the License and a deferred compensation obligation of RespireRx including the 4% royalty on net sales due to UIL has been extended for up to 8 years after the original patent rights expire by including a royalty on the net sales protected by a patent application submitted by the Company describing a new formulation of dronabinol. Guaranteed minimum annual payments of $350,000 begin the first year with a market approval from the US FDA or a foreign equivalent and increase to $400,000 beginning the first year of a commercial sale of a product. Some or all of these annual minimum payments may be satisfied by royalty payments. Three annual minimum payments associated with the application for product approval, the actual approval and first commercial sale that had totaled $600,000 are now $750,000. The $350,000 milestone payment that would have been due upon the dosing of the 1st patient in a Phase III study is now two payments totaling $500,000, $150,000 of which is due upon the dosing of a 1st patient in a Phase III study anywhere in the world and $350,000 due upon the earlier of enrolling 80% of the patients in a Phase III study or one year after the initiation of the Phase III study or the termination of the Phase III study. Finally, a $500,000 payment is due within 5 days of the filing of a NDA or foreign equivalent and $1,000,000 is due within twelve months of first commercial sale of a product.
Arnold Lippa, PhD, RespireRx’s Executive Chairman, Interim President, Interim CEO and CSO and a director or ResolutionRx stated: “As we have previously announced, the Company has formed ResolutionRx, an unlisted public Australian company, for the purpose of developing pharmaceutical cannabinoids, with an initial focus on our proprietary formulated dronabinol. It is our intention to transfer all of our cannabinoid assets, including the License Agreement and certain liabilities, into ResolutionRx. The terms of this Second Amendment have relieved RespireRx and ultimately ResolutionRx of some of the short term financial liabilities and allows it focus of drug development.”
The above is a summary of what the Company believes are key provisions of the Second Amendment. It is intended that a copy of the entirety of the Second Amendment will be filed as an Exhibit to a Current Report on Form 8-K shortly. The above summary is qualified in its entirety by the Current Report of Form 8-K including the copy of the Second Amendment filed as an Exhibit such report.