COH Agreements |
9 Months Ended | |
|---|---|---|
Sep. 30, 2016 | ||
| License Agreement Disclosure [Abstract] | ||
| License Agreement Disclosure [Text Block] |
Note 3 - COH Agreements
On March 17, 2015, the Company entered into an exclusive license agreement with COH to acquire intellectual property rights pertaining to CAR-T. Pursuant to the agreement, the Company paid COH an upfront fee of $2.0 million, in April 2015 (included in research and development-licenses acquired expenses on the Condensed Statements of Operations), and granted 1,000,000 shares of Mustang’s Class A Common Stock, representing 10% ownership of Mustang, as of such date. Additional payments totaling $2.0 million are due upon the completion of two financial milestones, and payments totaling $14.5 million are due upon the completion of six development goals. Future mid-single digit royalty payments are due on net sales of licensed products, with a minimum annual royalty of $1.0 million. The Company valued the stock grant to COH utilizing a discounted cash flow model to determine the weighted market value of invested capital, discounted by a lack of marketability of 44.8% and a weighted average cost of capital of 30%, resulting in a $0.147 value per share or approximately $147,000 and is included in research and development-licenses acquired expenses on the Condensed Statements of Operations. In addition, the Company entered into a sponsored research agreement with COH in which the Company will fund continued research in the amount of $2.0 million per year, payable in four equal installments, over the next five years. For the three months ended September 30, 2016 and 2015, the Company recorded $0.5 million and $0.5 million, respectively, in research and development expenses on the Condensed Statements of Operations. For the nine months ended September 30, 2016 and for the period from March 13, 2015 (inception) to September 30, 2015, the Company recorded $1.5 million and $1.0 million, respectively, in research and development expenses on the Condensed Statements of Operations. |