Journey 

 

In January 2016, JMC entered into a licensing agreement with a third party to distribute its prescription wound cream Luxamend ® and paid an upfront fee of $50,000. Additionally, in January 2016, JMC entered into a licensing agreement with a third party to distribute its prescription emollient Ceracade ® for the treatment of various types of dermatitis and paid an upfront fee of $0.3 million. JMC commenced the sale of both of these products during the year ended December 31, 2016 and accordingly commenced the amortization of these costs over their respective three year estimated useful life.

 

In March 2015, JMC entered into a license and supply agreement to acquire the rights to distribute Targadox® a dermatological product for the treatment of acne. JMC made an upfront payment of $1.3 million. Further payments will be made based on a revenue sharing arrangement. JMC received FDA approval for the manufacturing of this product in July 2016 and commenced sales of this product in October 2016.

 

For the years ended December 31, 2017 and 2016, JMC recognized expense of approximately $0.5 million and $0.2 million, respectively, which was recorded in costs of goods sold on the Consolidated Statement of Operations (see Note 22). No expense was recorded in 2015.

 

 

For the years ended December 31, 2017 and 2016, National recognized license amortization expense of approximately $1.7 million and $0.5 million, which was recorded in general and administrative expenses on the Consolidated Statement of Operations (see Note 3). No expense was recorded in 2015.