|EXICURE, INC. filed this Form 424B3 on 02/07/2018|
(dollars in thousands)
We recognized revenue of $1.0 million for the year ended December 31, 2016 and $2.4 million for the year ended December 31, 2015. In connection with the Purdue Collaboration, we received a non-refundable development fee of $10.0 million in December 2016 which was deferred and is recognized as collaboration revenue over the period in which the revenue is earned. We recognized $0.7 million of collaboration revenue during the year ended December 31, 2016. The grant income revenue recognized in both the years ended December 31, 2016 and 2015 related to our performance as a primary contractor or as a subcontractor on government grants. The decrease in grant income revenue of $2.0 million is principally due to the conclusion of a grant in early 2016. We did not have any active grants as of December 31, 2016.
We do not intend for government grants to be a principal commercial or strategic focus, but will evaluate opportunities when consistent with our strategic priorities. We do not expect to generate any product revenue for the foreseeable future. However, future revenue may include amounts attributable to partnership activities including, a combination of research and development payments, license fees and other upfront payments, milestone payments, product sales and royalties, and reimbursement of certain research and development expenses, in connection with the Purdue Collaboration or any future collaboration and licenses.
Research and development expense
The following table summarizes our research and development expenses incurred during the periods indicated:
(dollars in thousands)
Clinical development programs expense
Platform and discovery-related expense
Facilities, depreciation, and other expenses
Total research and development expense
Full time employees
Research and development expense was $13.7 million for the year ended December 31, 2016 and $10.1 million for the year ended December 31, 2015, an increase of $3.5 million, or 35%. This increase was primarily due to a Northwestern University License Agreements fee and a net increase in costs related to our three therapeutic development programs of $1.0 million in 2016. The net increase of $1.0 million in 2016 related to our three therapeutic development programs and was mostly due to higher costs for the preparation of XCUR17 and AST-008 for Phase 1 clinical trials, partially offset by lower costs associated with AST-005 for which we completed the Phase 1 trial during 2016. Also contributing to the increase in research and development costs in 2016 were higher materials and supplies expense of $0.6 million for internal research and development activities associated with the development and discovery of new therapeutic candidates and higher compensation and related expense of $0.4 million, mostly associated with the hiring of our Chief Scientific Officer in October 2015 as well as the addition of new employees during 2016 and the impact of general and promotional salary increases during 2016.