License Agreement

12 Months Ended

Dec. 31, 2019

License Agreement [Abstract]

LICENSE AGREEMENT

NOTE 5:- LICENSE AGREEMENT

In May 2015, Wize Israel entered into an Exclusive Distribution and Licensing Agreement (as amended, the "License Agreement") with Resdevco Ltd. ("Resdevco"), whereby Resdevco granted to Wize Israel an exclusive license to purchase, market, sell and distribute a formula known as LO2A ("LO2A") in the United States and China as well as a contingent right to do the same in other countries. LO2A is a drug developed for the treatment of DES, and other ophthalmological illnesses, including CCH and Sjögren's. Pursuant to the LO2A License Agreement, Wize Israel is required to pay Resdevco royalties for sales in the licensed territories, payable on a semi-annual basis, subject to making certain minimum royalty payments as set forth in the LO2A License Agreement. In January 2019 and January 2020, the Company paid Resdevco royalties in the amount of $150.

Pursuant to the License Agreement, the minimum royalties payable by Wize Israel to Resdevco shall be $150 per year through 2021. A one-time payment to Resdevco by Wize Israel in an amount of $650 shall be due no later than the second anniversary of the receipt of Food and Drug Administration ("FDA") approval (the "Deferred Amount"); however, following FDA approval, if annual royalties due to Resdevco by Wize Israel exceed the Minimum Royalties (as defined in the License Agreement), an amount equal to 50% of such excess shall be added towards settlement of the Deferred Amount. As to royalty payments, Resdevco shall be entitled to the greater of $0.60 per unit sold, or a percentage of revenues, not to exceed 10%, from sales made in the United States and other countries, excluding Israel, China and Ukraine, but not less than the Minimum Royalties.

The Company has determined not to pursue currently any activities outside the USA until the Company will obtain from Resdevco satisfactory registration file including DES and at least one more indication such as CCH or Sjögren's. The Company seeks to approve a proposed regulatory strategy acceptable to the Chinese market based on the regulatory files provided.

As of the date of these Financial Statements, the Company had not received FDA approval for LO2A.

As of December 31, 2019, the Company has recognized a liability of $250, representing the minimum commitment to pay royalties based on the upcoming January 2020 payment in an amount of $150 and an amount of $100 which represents a termination fee payable to Resdevco if the Company exercises its right to terminate the License Agreement.

As of December 31, 2019 and 2018, the current liability to pay future royalties amounts to $250 (see also Note 6).

On February 28, 2019, the Company terminated the distribution agreements in the territory of Ukraine.