7. INTANGIBLE ASSETS

 

In May 2016, the Company entered into an agreement with BioDelivery Sciences International, Inc. (“BDSI”) to license the rights to develop, manufacture, and commercialize Onsolis® (fentanyl buccal soluble film), or Onsolis, in the United States.  Onsolis is a Transmucosal Immediate-Release Fentanyl (“TIRF”) film indicated for the management of breakthrough pain in certain cancer patients. The Company expects to launch the product after the completion of the transfer of manufacturing and required submission to the FDA of a Prior Approval Supplement. Subject to FDA approval of the Prior Approval Supplement, the Company expects to launch Onsolis during the second half of 2017. In addition, during the term of the License Agreement, milestone payments in the aggregate amount of $21,000 may become payable by the Company subject to the satisfaction of certain commercialization, intellectual property, and net sales milestones, including $4,000 upon the first commercial sale of the product in the U.S. Finally, the Company will be required to pay royalties in the upper teens based on annual net sales of the product in the U.S.  As of December 31, 2016, the Company has not satisfied the criteria of any milestones or royalties payable under the License Agreement and has not recognized any liabilities for such milestones or royalties payable in its consolidated financial statements.

 

The Company made an upfront payment of $2,500 and is contractually committed to reimburse BDSI up to a maximum of $2,000 for its out-of-pocket expenses incurred in connection with the manufacturing transfer. The Company recorded the upfront payment as an intangible asset on the Consolidated Balance Sheet and will amortize it on a straight-line basis over the remaining patent life, a period of approximately 3.7 years. During the year ended December 31, 2016, the Company recognized amortization of expense of $397 related to the Onsolis intangible asset, which also represents the accumulated amortization to date. As of December 31, 2016, the remaining amortization period is approximately 3.1 years and estimated remaining amortization for 2017, 2018, 2019 and 2020 is expected to be $682,  $682,  $682,  $57.