Animal Health

Overview

Our boron chemistry platform has also demonstrated the potential to treat some of the leading causes of diseases in animals caused by bacteria, fungi and parasites. Animal health products include vaccines, antibiotics, antifungals, anti-parasitics and medical feed additives in an animal health market that is primarily driven by two main forces: pet owners demanding more and better treatments for companion animals, and the increased demands for the production of food animals resulting from a growing world population. Like our neglected disease work, our work in the animal health area allows us the potential benefits of expanding the chemical diversity of our boron compounds, understanding new properties of boron compounds and, ultimately, if an animal health drug product is approved, potential revenue.

Our Collaboration with Eli Lilly and Company

In August 2010, we and Lilly entered into a research, license and commercialization agreement (the “Lilly Agreement”) to develop new products for a variety of animal health indications. Pursuant to the Lilly Agreement, Lilly licensed a development compound from us in December 2012 for the potential treatment of an animal health indication and is responsible for all further development and commercialization of this compound. The research term of the Lilly Agreement terminated effective April 2014. The remainder of the Lilly Agreement, including provisions related to potential future payments and royalties owed to us, remains in effect and Lilly retains its exclusive rights to the development of the licensed compound. We are eligible to receive payments upon Lilly’s achievement of specified development and regulatory milestones, as well as tiered royalties, escalating from percentages in the high single digits to in-the-tens, on any future sales. Our royalty rights continue through the later of expiration of our patent rights or six years from the first commercial sale on a country-by-country basis.