Research and Development Services
The Company has certain arrangements with our collaboration partners that include contracting our full-time employees for research and development programs. These revenues are recorded in contract revenue as the services are performed.
Research and development expenditure
Given the stage of development of the Company’s products, all research expenditure is recognized as expense when incurred. Research and development expenditures include:
| · | the cost of acquiring, developing and manufacturing active pharmaceutical ingredients for product candidates that have not received regulatory approval, clinical trial materials and other research and development materials; |
| · | fees and expenses incurred under agreements with contract research organizations, investigative sites, and other entities in connection with the conduct of clinical trials and preclinical studies and related services, such as administrative, data management, and laboratory services; |
| · | fees and costs related to regulatory filings and activities; |
| · | costs associated with pre-clinical and clinical activities; and |
| · | employee-related expenses, including salaries and bonuses, benefits, travel and stock-based compensation expense |
For external research contracts the “stage of completion” method is used to estimate the amount of accrued expense related to the research projects for its clinical studies. The Company estimates its accrued expenses as of the balance sheet date in the financial statement based on facts and circumstances known at the time.
Registration costs for patents are part of the expenditure for research and development projects. Therefore, registration costs for patents are expensed when incurred as long as the research and development project concerned does not meet the criteria for capitalization.
