Note 10 - Commitments and Contingencies

6 Months Ended

Jun. 30, 2026

Notes to Financial Statements

Commitments and Contingencies Disclosure [Text Block]

10. Commitments and Contingencies

Lease

The Company has four leases for facilities used by VBI in San Antonio, Texas.  Refer to Note 7, Leases, for a full discussion of each of the leases and the total commitment by year for the facility leases as a whole. 

Additionally, the Company signed a one-year lease for corporate office space in San Antonio, TX with an effective date of March 16, 2026. The lease calls for monthly base rent of $1,188 and will automatically renew for successive one-year terms unless terminated by either party.   

Exclusive License Agreement – Statera BioPharma

As discussed above in Note 9, the Company is obligated to make certain payments to Statera pursuant to the A&R License Agreement, upon the achievement of certain commercialization milestones.

Shear Kershman 

In April 2026, the Company entered into a Product Development Agreement and Option to License Product and Intellectual Property (the "SKL Agreement") with Shear Kershman Labs, a Missouri corporation ("SKL"), pursuant to which the Company engaged SKL to develop a heat-stable oral mucosal delivery formulation of Entolimod utilizing proprietary formulation systems, with the objective of demonstrating systemic absorption via oral mucosal delivery. Under the SKL Agreement, the Company has an option, subject to an option period and other specified terms and conditions, to license the products and intellectual property developed under the agreement. In connection with the SKL Agreement, the Company is obligated to pay SKL a fixed fee of $0.5 million upon project commencement and may be required to make additional payments of up to $7.2 million upon the achievement of specified development and regulatory milestones. The Company may also be obligated to pay up to an additional $12.5 million in sales-based milestone payments, as well as royalties on net sales of commercialized licensed products. As of June 30, 2026, the Company had recorded a liability of $0.2 million related to the SKL Agreement, which is included in accounts payable in the accompanying condensed consolidated balance sheets.

Larmor Bio

In April 2026, Velocity Bioworks, Inc., the Company's wholly-owned subsidiary, entered into a Purchase, Collaboration, and Strategic Partnership Agreement (the "Larmor Agreement") with LarmorBio, Inc., a Delaware corporation ("Larmor"), pursuant to which Velocity engaged Larmor to design, develop, and install a prototype real-time cell monitoring and analytics system tailored to Velocity's bioreactor specifications. Under the terms of the Larmor Agreement, Velocity has exclusive use of the system and associated technology within the CDMO sector for a specified period of time. Velocity was also granted a non-exclusive license to all future iterations and next-generation updates of the technology developed by Larmor during the term of the agreement. In addition, the Company was granted observer representation on Larmor's board of directors, as well as a right to invest in Larmor's equity, the terms of which remain subject to negotiation of a separate definitive agreement. Under the Larmor Agreement, Velocity has potential developmental and investment achievement milestone payment obligations of up to $1.4 million. As of June 30, 2026, the Company had recorded a liability of $0.6 million related to the Larmor Agreement, which is included in accounts payable and accrued expenses in the accompanying condensed consolidated balance sheets.

Contingencies

From time to time, the Company may have certain contingent liabilities that arise in the ordinary course of its business activities. The Company accrues a liability for such matters when future expenditures are probable and such expenditures can be reasonably estimated. The Company recorded no liabilities for contingent matters as of June 30, 2026.