Company: HROW
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001641172-25-000925
Chunk: 938

Company: HARROW, INC.
Filing Date: 2025-03-27
Form: 10-K
Item: Item 5
Chunk 938
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 of time after the NDAs are transferred
and to assist with technology transfer of the NVS 5 Products manufacturing to other third-party manufacturers, if needed.

The assets acquired in the NVS 5 Acquisition are
identifiable intangible asset groups in similar asset classes and all directly related to the five product NDAs acquired. The developed
technology is within one major intangible asset class. No workforce/employees were included in the NVS 5 Acquisition, and the Company
is required to utilize its own business inputs/processes to transfer and commercialize the NVS 5 Products and NDAs.

The Company incurred $558,000 in costs associated
with the NVS 5 Acquisition. Including such acquisition costs and the payment of $130,000,000 at closing, the total purchase price of
the NVS 5 Acquisition was $130,558,000 and was accounted for as an asset acquisition. At the time of the NVS 5 Acquisition and as of
December 31, 2023, the contingent consideration due related to the commercial availability of TRIESENCE was not considered probable and
reasonably estimable and, therefore, no amount was included in the purchase price of the NVS 5 Acquisition. In 2024, the Company determined
the milestone related to the commercial availability of TRIESENCE was probable of being achieved, and recognized the $37,000,000 milestone
payment as an increase in the amount of intangible assets and allocated to all of the assets on a pro rata basis based on their initial
estimated fair values as a percent of the total purchase price. The Company does not consider any amounts related to TRIESENCE to be
in-process research and development (IPR&D) as considered within the scope of ASC 730, Research and Development.

NOTE 5. INVESTMENT IN MELT PHARMACEUTICALS, INC.
AND AGREEMENTS – RELATED PARTY TRANSACTIONS

In December 2018, the Company
entered into an asset purchase agreement with Melt (the “Melt APA”). Pursuant to the terms of the Melt APA, Melt was assigned
certain intellectual property and related rights from the Company to develop, formulate, make, sell, and sub-license certain Company
conscious sedation and analgesia related formulations (collectively, the “Melt Products”). Under the terms of the Melt APA,
Melt is required to make mid-single digit royalty payments to the Company on net