Company: SCYX
Filing Date: 2025-03-12
Form Type: 10-K
Source: 0000950170-25-038044
Chunk: 201

Company: SCYNEXIS INC
Filing Date: 2025-03-12
Form: 10-K
Item: Item 7
Chunk 201
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 the 

54

other promises in the arrangement.  If the license is not distinct, the license is combined with other services into a single performance obligation. Factors that are considered in evaluating whether a license is distinct from other promised services include, for example, whether the counterparty can benefit from the license without the promised service on its own or with other readily available resources and whether the promised service is expected to significantly modify or customize the intellectual property.

We assessed the terms of the GSK License Agreement and identified the following performance obligations which include: (1) the license for the development, manufacture, and commercialization of ibrexafungerp, including the approved product BREXAFEMME, in the GSK Territory, (2) the research and development activities for the MARIO study, and (3) performance obligations for the remaining research and development activities for the ongoing clinical and preclinical studies of ibrexafungerp.  

For the GSK License Agreement, we allocate the transaction price based on relative standalone selling prices of each of the performance obligations.  We developed the estimated standalone selling price for the license using a Monte Carlo valuation analysis and for the research and development activities, we utilized the estimate of costs to be incurred to fulfill its obligations associated with the performance of the research and development activities, plus a reasonable margin.  In developing this estimate for the license, we applied significant judgment in the determination of the significant assumptions relating to forecasted future cash flows and discount rates.

Product Recall

We establish reserves for product recalls on a product-specific basis when circumstances giving rise to the recall become known. We estimate product recall from consumers and customers across distribution channels, utilizing third-party data and other assumptions, and these are recorded within gross-to-net expenses on our consolidated statement of operations. Additionally, we estimate costs for any additional fees, including but not limited to freight and destruction charges for returned products and costs incurred by third party vendors. These expenses are recorded within selling, general, and administrative expenses within our consolidated statement of operations as they are in excess of the initial revenue recognized. These estimates are updated and reevaluated each period and the related reserves are adjusted when these factors indicate that the recall reserves are either insufficient to cover or exceed the estimated product recall expenses. Significant changes in the assumptions used to develop estimates for product recall reserves could affect key financial information, including inventory, accrued liabilities, net sales, gross profit, and net income (loss).

Research and Development Accruals

We are required to estimate our expenses resulting from our obligations under contracts