Related Parties

9 Months Ended

Sep. 30, 2023

Related Party Transactions [Abstract]

Related Parties

11. Related Parties

Joint Venture

On February 11, 2018, the Company entered into a Joint Venture (“JV”) Agreement with Hepalink which is a related party and principal shareholder in the Company, pursuant to which the Company formed a JV Entity for developing and commercializing products for infectious diseases in the greater China territories. It was agreed by the parties that the Company shall be reimbursed for certain legal and contract manufacturing expenses related to the clinical drug supply for a Phase 3 clinical study of AR-301 and the clinical drug supply for a clinical study of AR-105. For both the three and nine month periods ended September 30, 2023, and 2022, the Company recorded $0, as a reduction to operating expenses in the condensed consolidated statements of operations for amounts reimbursed to the Company by the JV Entity under this arrangement. As of September 30, 2023, and December 31, 2022, the Company recorded approximately $6,000 and $33,000, respectively, in other receivables on the condensed consolidated balance sheets for amounts owed to the Company by the JV Entity under this arrangement and the Company expects the amounts to be collectable and as a result, no reserve for uncollectability was established.

On August 21, 2023, Aridis Pharmaceuticals, Inc. (the “Company”) sent written notice to Shenzhen Arimab Biopharmaceuticals Co., Ltd. (“Arimab”) stating that as of August 21, 2023, the Amended and Restated Technology License and Collaboration Agreement between Arimab, a joint venture of the Company and Shenzhen Hepalink Pharmaceutical Group Co., Ltd. dated as of August 6, 2018 (the “Agreement”) would terminate pursuant to Section 11.2 of the Agreement.

Serum International B.V.

In July 2019, the Company issued 801,820 shares of its restricted common stock in a private placement to Serum International B.V. (“SIBV”), an affiliate of Serum Institute of India Private Limited, for total gross proceeds of $10 million. As a result of this transaction, SIBV and its affiliates, are considered related parties to the Company. In September 2019, the Company and Serum AMR Products, a party under common ownership of SIBV, entered into a License, Development and Commercialization Agreement (the “License Agreement”) (see Note 6).

On May 3, 2023, the Company sent written notice to SAMR stating that as of May 8, 2023, the License Agreement would terminate pursuant to Section 13.3(a) of the License Agreement for nonfulfillment of development obligations under the License Agreement.

As a result of termination of the License Agreement, the Company recognized approximately $19.6 million in license revenue during the nine-month period ended September 30, 2023. No license revenue had previously been recognized in connection with the License Agreement. The Company has no remaining portion of the nonrefundable upfront payment as a contract liability on its condensed consolidated balance sheet as of September 30, 2023 and has no further obligations under the License Agreement due to the termination.

The Company recorded an impairment loss of approximately $2.1 million of a capitalized contract asset related to the incremental costs of obtaining the License Agreement resulting from termination of the License Agreement during the nine-month period ended September 30, 2023. No impairment losses had previously been recorded in connection with the License Agreement.

Cystic Fibrosis Foundation

On December 7, 2022, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with the Cystic Fibrosis Foundation ( “CFF”), pursuant to which the Company agreed to offer, issue and sell to CFF in a private placement (the “PIPE”) 5,168,732 shares (the “Common Shares”) of common stock, par value $0.0001 (the “Common Stock”) for a purchase price of $0.938 per share for aggregate gross proceeds of approximately $4.85 million. In connection with the PIPE, CFF agreed not to sell or transfer any of the Common Shares, subject to certain customary exceptions, for a period of six months from the closing date of the PIPE.