Annual report pursuant to Section 13 and 15(d)

Animal Health License Agreements

Animal Health License Agreements
12 Months Ended
Dec. 31, 2018
Animal Health License Agreements [Abstract]  
Animal Health License Agreements
Note 12.  Animal Health License Agreements:
Ceva License Agreement
In July 2012, the Company entered into an exclusive license agreement (the “License Agreement”) with Ceva Santé Animale S.A. (“Licensee”), under which the Company granted the Licensee an exclusive royalty-bearing license, until December 31, 2028, to the Company's intellectual property and other assets, including both (a) the Company’s patent rights and know-how, relating to recombinant single chain reproductive hormone technology for use in non-human mammals (the “Company's Animal Health Assets”) and (b) the technology licensed to the Company by Washington University in St. Louis (“WU”). The License Agreement contains termination provisions as defined in the License Agreement.

Under the License Agreement, the Licensee obtained a worldwide exclusive license to develop, seek regulatory approval for and offer to sell, market, distribute, import and export luteinizing hormone ('LH') and/or follicle-stimulating hormone (“FSH”) products for bovine (cattle), equine and swine in the field of the assistance and facilitation of reproduction in bovine, equine and swine animals.  The Company also granted the Licensee an option and right of first refusal to develop additional animal health products outside of the licensed field of use or any diagnostic pregnancy detection tests for non-human mammals.

Under the License Agreement as of December 31, 2018, the Company would be entitled to receive future payments if Ceva achieves certain regulatory approvals as outlined in the License Agreement, summarized as follows:

Payments, totaling up to a potential of $1.1 million in the aggregate, based on the satisfactory conclusion of conditions as defined in the License Agreement;

Potential for payments of up to an additional $2 million for development and receipt of regulatory approval for additional licensed products; and

Royalties, at low double-digit rates, based on sales of licensed products.

The upfront license fees received from the License Agreement have been recorded as deferred revenue and are amortized over the term of the License Agreement.  License fees revenue totaling a net of approximately $1,556,000 commenced being amortized in July 2012. As of December 31, 2018, deferred revenue of $96,698 has been classified as a current liability and $871,919 has been classified as a long-term liability. The current liability represents the next twelve months' portion of the license fees revenue. For each of the years ended December 31, 2018 and 2017, approximately $97,000, was recorded as the amortized license fee revenue.
Washington University License Agreement
During 2004 WU and Riot Blockchain entered into an exclusive license agreement which grants Riot Blockchain exclusive license and right to sublicense WU's technology (as defined under the WU License Agreement) for veterinary products worldwide, except where prohibited. The term of the WU License Agreement continues until the expiration of the last of WU's patents (as defined in the WU License Agreement) expire in 2019.  Riot Blockchain has agreed to pay minimum annual royalties, creditable against future royalties and royalties payable to WU for covered product sales by Riot Blockchain carrying a mid-single digit royalty rate and for sublicense fees received by Riot Blockchain carrying a low double-digit royalty rate. No royalty payments were made during the years ended December 31, 2018 and 2017.