On February 12, 2024, the Company entered into an Amendment to the COVID License Agreement with TheraCour dated September 7, 2021, whereby any further cash milestone payments that would be earned upon milestone event would only become payable upon the Company having sufficient revenues, with only a portion of revenues to be used for satisfying such milestone payments.
By signing on September 23, 2024, and being effective as of September 20, 2024 the Company entered into a “Memorandum of Understanding for All Antivirals Drug Development” (the “MOU”) with TheraCour that granted to the Company, a limited, non-assignable, non-sublicensable, exclusive right of first refusal to License to any antiviral drugs in development or to be developed by TheraCour for research and development purposes only, for all as-yet unlicensed viral infection treatment indications. The MOU also clarified the roles and responsibilities of the Parties and essentially codified the process that the Parties have adopted since inception. The MOU further codified the treatment of all future milestone payments arising from any current or future license agreements to TheraCour to be consistent with the principles adopted in the February 12, 2024 Amendment to the COVID License Agreement.
Development fees and other costs charged by TheraCour for the years ended June 30, 2024 and 2023 were approximately $2,550,000 and $2,536,000, respectively. At June 30, 2024, approximately $720,000, was due to TheraCour.
No royalties are due TheraCour from the Company’s inception through June 30, 2024.
TheraCour is affiliated with the Company through Dr. Anil Diwan, our Founder, President, and Executive Chairman, who owns approximately 90% of the capital stock of TheraCour which itself owns 470,961 shares of the Company’s outstanding common stock and 681,859 shares of the Company’s Series A preferred stock as of June 30, 2024.
Line of Credit - Related Party – Anil Diwan
On November 13, 2023, the Company’s President and CEO, Dr. Anil Diwan, entered into a Line of Credit Agreement whereby Dr. Diwan agreed to provide a standby Line of Credit to the Company in the maximum amount of $2,000,000. All amounts outstanding under the Line of Credit, including principal, accrued interest and other fees and charges, will be due and payable on December 31, 2024. Amounts drawn down under the Line of Credit shall bear interest at a fixed rate of 12%. Advancements under the Line of Credit will be collateralized by an Open End Mortgage Deed on the Company’s real property at 1 Controls Drive, Shelton, Connecticut and a Chattel Mortgage (U.C.C - 1 filing) against the Company’s equipment and fixtures. Any draw down under the Line of Credit requires the approval of the Company’s Board of Directors. On February 12, 2024, the Company, pursuant to Article 2.5 of the Company’s Line of Credit Agreement with Dr. Anil Diwan, signed an Extension Agreement which extended the maturity of the Company’s Line of Credit from December 31, 2024 to December 31, 2025. There were no other amendments to the original Line of Credit. By signing pn September 23, 2024 and being effective as September 20, 2024 the Company, pursuant to Article 2.5 of the Company’s Line of Credit Agreement with Dr. Anil Diwan, signed an Amendment Agreement which increased the available line of credit from $2 million to $3 million, and extended the maturity of the Company’s Line of Credit from December 31, 2025 to March 31, 2026.
The Company has not drawn against the Line of Credit facility as of June 30, 2024.
Karveer Meditech, Private Limited (KMPL)
On March 27, 2023 the Company entered into a License Agreement with KMPL, wherein the Company granted to KMPL a limited, non-transferable, exclusive license for the use, sale, or offer of sale in India of the Company’s two clinical test drug candidates titled as NV-CoV-2 and NV-CoV-2-R for the treatment of COVID-19 in patients in India (“KMPL COVID License”). KMPL has engaged in further drug development in India including sponsoring of drug candidates for human clinical trials in India and is acting as clinical trials manager for such clinical trials. KMPL is in the process of establishing a manufacturing plant for some of those medicines. KMPL shall provide NanoViricides with all reports of the clinical trials and the Company has the rights to use such reports for further advancement of the drug candidates with regulatory authorities outside India. In consideration, KMPL will be reimbursed by the Company for all direct and indirect costs incurred for the clinical trials and development activities with a customary clinical trials manager fee of thirty (30%) of such costs and applicable taxes. Upon commercial sales of any resulting approved drugs, KMPL will pay the Company a royalty of seventy percent (70%) of the final invoiced sales less the cost of sales and goods sold to unaffiliated third parties. On June 19, 2023 KMPL commenced the equivalent of Phase I clinical trials in India. The Company has incurred clinical trial costs to KMPL of $442,845 and $100,000 for the years ended June 30, 2024 and 2023 respectively, As of June 30, 2024 and 2023, respectively, $227,435 and $100,000 of such costs were accrued by the Company pursuant to the license agreement between the Company and KMPL.