Company: NCEL
Filing Date: 2025-05-16
Form Type: 20-F
Source: 0001213900-25-044868
Chunk: 365

Company: NewcelX Ltd.
Filing Date: 2025-05-16
Form: 20-F
Item: Item 19
Chunk 365
---
 those licenses
did not singularly result in the transfer of the Company’s broader obligation to Eurofarma under the EF License Agreement.

The Company was obligated under the EF License
Agreement to advance its development activities in the United States and those activities preceded Eurofarma’s necessary regulatory
approvals for commercialization of Nolazol, in Latin American countries. The Company intended to apply its proprietary know-how to the
ongoing development activities in the United States involving its intellectual property relating to Nolazol. These development activities
were specific to the Company and the Company believed they were not capable of being distinct in the context of the EF License Agreement
on the whole.

The licenses provided to Eurofarma were not
transferable and without the right to sublicense therefore Eurofarma was not presently able to monetize its investment in Nolazol as
clinical development in the United States or any Latin American countries had yet to be completed and Eurofarma had yet to seek or
obtain regulatory approval in any Latin American country. The licenses to Eurofarma represented rights to use the Company’s
intellectual property with respect to Nolazol for which revenue was recognized at a point in time which was when Eurofarma was able
to use and benefit from the licenses. The licenses were considered of limited value without the Company’s development
activities with respect to Nolazol in the United States. As such, the licenses were not capable of being distinct until after
successful clinal development and regulatory approval and alone did not have standalone functionality to Eurofarma. Management had
determined that the licenses, while capable of being distinct, were not distinct as they did not have stand-alone value to Eurofarma
without the Company’s planned development activities in the United States and the approval for sale in Latin America.

F-18

NLS PHARMACEUTICS LTD. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Bundled together with the Company’s development
activities of Nolazol in the United States, the licenses granted under the EF License Agreement enabled Eurofarma to seek regulatory approvals
and ultimately seek to commercialize Nolazol in Latin America. Therefore, management believed the licenses bundled together with the Company’s
development activities in the United States constituted a single distinct performance obligation under the EF License Agreement for accounting
purposes (the “ License Performance Obligation”).

The Company had initially estimated a total transaction
price