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Grant Revenues
9 Months Ended
Sep. 30, 2016
Grant Revenues [Abstract]  
Grant Revenues

6. Grant Revenues

In June 2015, the Company entered into a Cancer Research Grant Contract (“Grant Contract”) with CPRIT, under which CPRIT awarded a grant not to exceed $19.8 million for use in developing cancer treatments by exploiting the metabolism of cancer cells. The Grant Contract covers a three year period from June 1, 2014 through May 31, 2017.

Upon commercialization of the product, the terms of the Grant Contract require the Company to pay tiered royalties in the low to mid-single digit percentages. Such royalties reduce to less than one percent after a mid-single-digit multiple of the grant funds have been paid to CPRIT in royalties.

The agreement includes reimbursement for qualified expenditures incurred and recognized in 2014. Upon execution of the Grant Contract, grant revenue was recognized for the accumulated qualified expenditures paid and recognized in the period from June 1, 2014 through June 30, 2015. The Company recognized grant revenue of $1.2 million and $1.1 million in the three months ended September 30, 2016 and 2015, respectively, and $3.4 million and $4.5 million in the nine months ended September 30, 2016 and 2015, respectively, for qualified expenditures under the grant. As of September 30, 2016 and December 31, 2015, the Company had an outstanding grant receivable of $1.6 million and $1.7 million, respectively, for the grant expenditures that were paid but had not been reimbursed and deferred revenue of $0.2 million and $0, respectively, for proceeds received but the costs had not been incurred or the conditions of the award had not been met.