Company: HROW
Filing Date: 2025-11-10
Form Type: 10-Q
Source: 0001493152-25-021562
Chunk: 46

Company: HARROW, INC.
Filing Date: 2025-11-10
Form: 10-Q
Item: Item 1
Chunk 46
---

Purchase, License and Related Agreements

FDA
Approved Product Acquisitions

In
recent years, the Company has acquired commercial and product rights to various FDA approved ophthalmic medications and products through
asset purchase, licenses, supply and/or other related agreements. In general, in exchange for product and commercial rights these agreements
provide the counterparties with certain upfront and contingent milestone payments typically related to certain annual sales amounts and
manufacturing events, and in certain cases, per unit transfer prices and royalties on sales of some of the products. In June 2025, the
Company announced that it had entered into a license and supply agreement (the “Formosa Agreement”) with Formosa Pharmaceuticals,
Inc. (“Formosa”). Under the terms of the Formosa Agreement, the
Company licensed from Formosa the exclusive rights and marketing authorization of BYQLOVITM (clobetasol propionate ophthalmic
suspension) 0.05% in the U.S. market. In consideration for such rights, the Company will make a one-time payment to Formosa equal to
$500,000 at the time the Company makes its first commercial sale of BYQLOVI to a third party and Formosa will be eligible to receive
other one-time payments based on achievement of commercial gross profit milestones along with royalties on gross profits of BYQLOVI.

During
the three and nine months ended September 30, 2025, $2,480,000 and $6,853,000 were incurred under these agreements as royalty expenses,
respectively, and $730,000 and $2,040,000, respectively, during the same period in 2024, which are presented as a component of cost of
goods sold within the statement of operations. During the three and nine months ended September 30, 2024, $0 was incurred under
these agreements related to upfront and milestone payments under these agreements., and $0, during the same periods in 2024. As of September
30, 2025, the remaining contingent consideration payable pursuant to these agreements were not considered probable and reasonably estimable
and therefore, no amount was accrued related to these contingent obligations during the nine months ended September 30, 2025. At the
time contingent consideration payable becomes probable and reasonably estimable, the additional consideration, if any, paid will be allocated
to the assets based on their initial estimated fair values as a percent of total purchase price.

BYOOVIZ®