| Item 1.01 | Entry into a Material Definitive Agreement |
Agreements with Recro
On November 21, 2019, Recro Pharma, Inc. (“Recro”) completed the previously announced separation of its acute care business segment, and certain other assets and liabilities. The separation was effected by way of a distribution of all of the then outstanding shares of common stock of Baudax Bio, Inc. (the “Company”) through a dividend of one share of the Company’s common stock for every two andone-half shares of Recro common stock held by Recro shareholders as of the close of business on November 15, 2019, the record date for the distribution (the entire transaction being the “Separation”). As a result of the Separation, the Company became an independent public company and commenced regular way trading under the symbol “BXRX” on the Nasdaq Capital Market on November 22, 2019.
In connection with the Separation, on November 20, 2019, the Company entered into certain agreements with Recro to provide a framework for the Company’s relationship with Recro following the Separation, including, among others, the following agreements:
| | • | | A Separation Agreement; |
| | • | | A Tax Matters Agreement; |
| | • | | An Employee Matters Agreement; and |
| | • | | A Transition Services Agreement. |
A summary of each of the foregoing agreements can be found in the section entitled “Certain Relationships and Related Person Transactions—
Agreements with Recro” of the Information Statement (the “Information Statement”), dated November 12, 2019, filed as Exhibit 99.1 to this Current Report on Form8-K and incorporated into this Item 1.01 by reference. In addition, the descriptions of the foregoing agreements are qualified in their entirety by reference to the complete terms and conditions of those agreements, which are attached as Exhibits 2.1, 10.1, 10.3 and 10.4, respectively, to this Current Report on Form8-K and incorporated into this Item 1.01 by reference.
Bifurcation Agreement
Recro Gainesville LLC, a wholly-owned subsidiary of Recro (“Recro Gainesville”), is a party to the Asset Transfer and License Agreement by and between Alkermes Pharma Ireland Limited (“APIL”) and Recro Gainesville (as successor to DV Technology LLC), dated April 10, 2015 (as amended, the “Alkermes License Agreement”), pursuant to which Recro Gainesville exclusively licenses certain intellectual property from APIL, including nanotechnology intellectual property (the “Nanotechnology IP”) for use in the development, manufacturing and commercialization of IV meloxicam.
In connection with the Separation, on November 20, 2019, the Company entered into a Partial Assignment, Assumption and Bifurcation Agreement (the “Bifurcation Agreement”) with Recro Gainesville and APIL, pursuant to which Recro Gainesville assigned, conveyed and transferred to the Company the exclusive worldwide license, to the Nanotechnology IP for use in the development, manufacturing and commercialization of IV meloxicam. Under the Bifurcation Agreement, the Company agreed to satisfy certain obligations and liabilities under the Alkermes License Agreement, including the obligations to make up to $140 million inearn-out consideration payments to APIL for developmental and commercial milestones achieved relating to IV meloxicam and to pay anearn-out percentage of future net sales of IV meloxicam between 10% and 12% . Recro Gainesville remains responsible for all other rights and obligations under the Alkermes License Agreement that are not bifurcated, assigned to and/or assumed by the Company.
The description of the Bifurcation Agreement is qualified in its entirety by reference to the complete terms and conditions of the Bifurcation Agreement, which is attached as Exhibit 10.5 to this Current Report on Form8-K and incorporated into this Item 1.01 by reference.
| Item 2.01 | Completion of Acquisition or Disposition of Assets |
The description of the Separation included under Item 1.01 of this Current Report on Form8-K is incorporated into this Item 2.01 by reference.
