License and collaboration agreement

6 Months Ended

Jun. 30, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

8. License and collaboration agreement

In May 2018, the Company entered into an exclusive license and collaboration agreement with Astellas US LLC, a subsidiary of Astellas Pharma Inc. (“Astellas”). The Company granted Astellas an exclusive, royalty-bearing license to use, research, develop, manufacture and commercialize the Company’s drug candidate, rosiptor, and related compounds for all human diseases and conditions in Japan and certain other countries in the Asia-Pacific region. The license and collaboration agreement also included an upfront payment of $25.0 million and contractual milestones.

The Company determined that its performance obligations under the agreement are the license and transfer of data, ongoing information sharing with Astellas and the material right granted to Astellas to acquire rosiptor at the Company’s cost. The upfront payment of $25.0 million was allocated between each of the performance obligations.

On June 27, 2018, the Company announced the Phase 3 trial of rosiptor failed to meet its primary endpoint and that all further development activities with rosiptor would be halted. As such, the Company will have no further performance obligations under the agreement. On September 4, 2018, Astellas provided notice to the Company that it was terminating the exclusive license and collaboration agreement between the Company and Astellas effective March 4, 2019, unless an earlier termination date is agreed to by the parties. On November 8, 2018, the Company entered into an Early Termination Agreement with Astellas to terminate the exclusive license and collaboration agreement between the Company and Astellas effective November 8, 2018. The $25.0 million upfront payment from Astellas is non-refundable and the full amount was recorded as revenue.