|9 Months Ended|
Sep. 30, 2018
6. Intangible Assets
The Company’s intangible assets consist of the following:
License agreements are being amortized over periods ranging from 17-20 years. Certain patent costs of $22,000 were being amortized over three years. As of September 30, 2018, those patents were fully amortized, and the remaining patents of $745,000 are a combination of pending patent costs, $69,000 of which is being amortized over periods up to 20 years. Amortization expense was approximately $19,000 for each of the three months ended September 30, 2018 and 2017, respectively, and $59,000 and $60,000 for the nine months ended September 30, 2018 and 2017, respectively. As of September 30, 2018, future amortization of license agreements and patents (i) for the remainder of fiscal year 2018 is $19,000, (ii) for the fiscal years 2019 through 2024 is expected to be $75,000 per year, and (iii) after 2024 an aggregate $60,000.
The Company has entered into multiple license agreements (together, the “License Agreements”) with the University of Florida Research Foundation and the University of Texas at Austin. Under the terms of the License Agreements, the Company acquired exclusive worldwide licenses for underlying technology used in repairing and regenerating nerves. The licensed technologies include the rights to issued patents and patents pending in the United States and international markets. The effective term of the License Agreements extends through the term of the related patents and the agreements may be terminated by the Company with 60 days’ prior written notice. Additionally, in the event of default, licensors may terminate an agreement if the Company fails to cure a breach after written notice. The License Agreements contain the key terms listed below:
Royalty fees were approximately $444,000 and $319,000 during the three months ended September 30, 2018 and 2017, respectively, and approximately $1.2 million and $860,000 during the nine months ended September 30, 2018 and 2017, respectively, and are included in sales and marketing expense on the accompanying condensed consolidated statements of operations.
The entire disclosure for all or part of the information related to intangible assets.
Reference 1: http://www.xbrl.org/2003/role/presentationRef