Company: HROW
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001641172-25-000925
Chunk: 164

Company: HARROW, INC.
Filing Date: 2025-03-27
Form: 10-K
Item: Item 1
Chunk 164
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 operations, and recorded as a reduction
to accounts receivable in the consolidated balance sheets, at the time the revenue is recognized.

Intellectual Property License Revenues

The Company currently holds five intellectual property
licenses and related agreements pursuant to which the Company has agreed to license or sell to a customer with the right to access the
Company’s intellectual property. License arrangements may consist of non-refundable upfront license fees, data transfer fees, research
reimbursement payments, exclusive license rights to patented or patent pending compounds, technology access fees, and various performance
or sales milestones. These arrangements can be multiple-element arrangements, the revenue of which is recognized at the point in time
that the performance obligation is met.

Non-refundable fees that are not contingent on any
future performance by the Company and require no consequential continuing involvement on the part of the Company are recognized as revenue
when the license term commences and the licensed data, technology, compounded drug preparation and/or other deliverables are delivered.
Such deliverables may include physical quantities of compounded drug preparations, design of the compounded drug preparations and structure-activity
relationships, the conceptual framework and mechanism of action, and rights to the patents or patent applications for such compounded
drug preparations. The Company defers recognition of non-refundable fees if it has continuing performance obligations without which the
technology, right, product or service conveyed in conjunction with the non-refundable fee has no utility to the licensee and that are
separate and independent of the Company’s performance under the other elements of the arrangement. In addition, if the Company’s
continued involvement is required, through research and development services that are related to its proprietary know-how and expertise
of the delivered technology or can only be performed by the Company, then such non-refundable fees are deferred and recognized over the
period of continuing involvement. Guaranteed minimum annual royalties are recognized on a straight-line basis over the applicable term.

    F-22

Revenue disaggregated by revenue source for the years
ended December 31, 2024 and 2023, consists of the following:

 SCHEDULE OF DISAGGREGATED REVENUE  

    2024  
    2023 

    For the Years Ended December 31, 

    2024  
    2023 
  
    Product sales, net 
    $198,619,000  
    $117,447,000 
  
    Transfer of acquired product sales/profits 
     995,000