Company: XAIR
Filing Date: 2025-06-20
Form Type: 10-K
Source: 0001641172-25-015750
Chunk: 520

Company: Beyond Air, Inc.
Filing Date: 2025-06-20
Form: 10-K
Item: Item 1
Chunk 520
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 which we receive regulatory approval for the
commercial sale of the first product candidate qualifying under the agreement. These milestone payments are almost entirely sales-related
and are capped at a total of $87 million across three separate and distinct indications that fall under the agreement with the majority
of them, approximately $83 million, being sales-related based on cumulative sales milestones for each of the three products.

Patent Applications. We
have over 72 pending patent applications worldwide, including U.S., foreign and Patent Corporation Treaty (“PCT”) patent applications.

A PCT patent application is a
filing under the Patent Cooperation Treaty to which the U.S. and a number of other countries are a party. It provides a unified procedure
for filing a single patent application to protect inventions in those countries. A search with respect to the application is conducted
by the International Searching Authority, accompanied by a written opinion regarding the patentability of the invention. A PCT application
does not itself result in the grant of a patent, and the grant of patent is a prerogative of each national or regional authority where
the PCT application is filed during national phase filings.

20

Settlement Agreement

On January 23, 2019, we entered
into an agreement for commercial rights (the “Circassia Agreement”) with Circassia Limited and its affiliates (collectively,
“Circassia”) for PPHN and future related indications at concentrations of < 80 ppm in the hospital setting in the
United States and China. On December 18, 2019, we terminated the Circassia Agreement. Circassia contended that the termination was wrongful.

On May 25, 2021, the Company and Circassia entered
into a settlement agreement (the “Settlement Agreement”) resolving all claims by and between both parties and mutually terminating
the Circassia Agreement. Pursuant to the terms of the Settlement Agreement, the Company agreed to pay Circassia $10.5 million in three
installments, all of which has been paid. Additionally, starting in 2025, Circassia began receiving a quarterly royalty payment equal
to 5% of LungFit® PH net sales in the U.S. This royalty will terminate once the aggregate payment reaches $6.0 million.
As of March 31, 2025, less than $0.1 million was paid to Circassia in royalties.

Government Regulation

U.S. Regulation. In the
U.S., the FDA