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Related Party Transactions
 6 Months Ended
Jun. 30, 2022
Related Party Transactions [Abstract]  
Related Party Transactions
16. Related Party Transactions
The Company has related party arrangements with UBI
 
and a number of its
 
affiliated companies listed namely, United Biomedical, Inc.,
Asia (“UBI-Asia”), UBI Pharma, Inc. (“UBI-P”), United BioPharma,
 
Inc (“UBP”) and UBI IP Holding (“UBI-IP”).
As of June 30, 2022 UBI owned
44
% of the Company’s stock. The
 
majority of the voting interests in both UBI and the Company
 
were
held by a group of immediate family members,
 
and as such the entities are under common control.
These related parties are governed by various Master Services Agreements
 
(“MSA”) detailed below.
 
UBI MSA - UBI provides research, development and clinical functions to the Company.
 
There is also a purchase arrangement
with UBI for the production and shipment of the Company’s
 
diagnostic test kits.
UBIA MSA - UBI-Asia for manufacturing, quality control, testing, validation,
 
and supply services.
UBP MSA - United BioPharma, Inc provide the Company with manufac
 
turing, testing and validation.
COVID MSA (“COVID
 
MSA”) - COVID
 
MSA provides that UBI
 
acts as COVAXX’s
 
agent with respect
 
to matters relating
the
 
Company’s
 
COVID-19
 
program
 
and
 
provides
 
research,
 
development,
 
manufacturing
 
and
 
back
 
office
 
administrative
services to the Company.
COVID-19
 
Relief
 
MSA
 
-
 
A four
 
-company
 
MSA
 
with
 
UBI,
 
UBI-Asia
 
and
 
UBP.
 
The
 
Company
 
is an
 
exclusive
 
licensee
 
of
technologies related to diagnostics, vaccines, and therapies for
 
COVID-19. The MSA established the terms under which UBI-
Asia
 
provides
 
research,
 
development,
 
testing
 
and
 
manufacturing
 
services
 
to
 
the
 
Company
 
and
 
UBP
 
provides
 
contract
development and manufacturing services to the Company.
Total
 
amounts due
 
to related
 
parties were
 
$
16.7
 
million and
 
$
19.4
 
million as
 
of June
 
30, 2022
 
and December
 
31, 2021,
 
respectively.
Total
 
amounts due
 
from related
 
parties were
 
$
0.4
 
million and
 
$
0.4
 
million as
 
of June 30,
 
2022 and
 
December 31,
 
2021, respectively.
Total service fees incurred
 
were $
0.4
 
million and $
13.9
 
million for the three months ended June 30, 2022 and 2021, respectively.
 
Total
service fees incurred were $
1.2
 
million and $
22.6
 
million for the six months ended June 30, 2022 and 2021, respectively.
 
Taiwan
 
Centers for Disease Control Grant (“Taiwan
 
CDC”)
 
UBI-Asia, which is responsible for applying for and managing grants on our behalf under the
 
COVID-19 program, was awarded a grant
by the Taiwan
 
CDC for COVID-19
 
vaccine development.
 
The Company
 
contracted with UBI-Asia
 
to conduct a
 
two-phase study of
 
a
COVID-19 vaccine
 
clinical trial in
 
Taiwan.
 
The grant provides
 
that costs incurred
 
to complete the
 
two phases of
 
the clinical trial
 
will
be reimbursed based on the achievement of certain milestones as provided
 
in the agreement.
The Company provides administrative
 
services to UBI-IP.
 
Under the arrangement, the
 
Company issues vendor payments
 
and provides
technical services mostly for
 
legal services on behalf
 
UBI-IP.
 
The Company bills UBI-IP
 
for services based on
 
the costs incurred with
no markup.
Total related party
 
operating activity, including
 
the activity described above, are as follows (in thousands):
June 30,
December 31,
2022
2021
Consolidated balance sheet
Assets
Prepaid expenses and other current assets
$
3,513
$
3,517
Amounts due from related parties
400
393
Property and equipment, net
240
337
Liabilities
Amounts due to related parties
16,724
19,407
Three Months Ended June 30,
Six Months Ended June 30,
2022
2021
2022
2021
Operating expenses
Research and development
Services provided by related parties
 
$
407
 
$
20,090
 
$
1,191
 
$
30,723
Taiwan CDC grant reimbursement
 
from related party
—
(6,575)
—
(8,992)
General and administrative
Services provided by related parties
$
—
$
355
$
—
$
862