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Note 10 - Commitments and Contingencies | 6 Months Ended
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Dec. 31, 2020
Notes to Financial Statements |
Commitments and Contingencies Disclosure [Text Block] | 10. Commitments and Contingencies Commitments and contingencies are described below and summarized by the following as of December 31, 2020 :
|  | Total |  |  | 2021 |  |  | 2022 |  |  | 2023 |  |  | 2024 |  |  | 2025 |  |  | Thereafter |
Prescription database |  | $ | 1,278,000 |  |  | $ | 545,000 |  |  | $ | 733,000 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Pediatric portfolio fixed payments and product minimums |  |  | 15,825,000 |  |  |  | 1,650,000 |  |  |  | 3,300,000 |  |  |  | 3,300,000 |  |  |  | 3,300,000 |  |  |  | 3,300,000 |  |  |  | 975,000 |
Inventory purchase commitment |  |  | 1,717,000 |  |  |  | 981,000 |  |  |  | 736,000 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
CVR liability |  |  | 14,000,000 |  |  |  | 2,000,000 |  |  |  | 2,000,000 |  |  |  | 5,000,000 |  |  |  | 5,000,000 |  |  |  | - |  |  |  | - |
Product contingent liability |  |  | 2,500,000 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 2,500,000 |
Product milestone payments |  |  | 3,000,000 |  |  |  | - |  |  |  | 3,000,000 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
|  | $ | 38,320,000 |  |  | $ | 5,176,000 |  |  | $ | 9,769,000 |  |  | $ | 8,300,000 |  |  | $ | 8,300,000 |  |  | $ | 3,300,000 |  |  | $ | 3,475,000 |
Prescription Database In May 2016, the Company entered into an agreement with a vendor that will provide it with prescription database information. The Company agreed to pay approximately $1.6 million over three years for access to the database of prescriptions written for Natesto. In January 2020, the Company amended the agreement and agreed to pay additional $0.6 million to add access to the database of prescriptions written for the Pediatric Portfolio. The payments have been broken down into quarterly payments. Pediatric Portfolio Fixed Payments and Product Milestone The Company assumed two fixed, periodic payment obligations to an investor (the “Fixed Obligation”). Beginning November 1, 2019 through January 2021, the Company will pay monthly payments of $86,840, with a balloon payment of $15,000,000 due in January 2021. A second fixed obligation requires the Company pay a minimum of $100,000 monthly through February 2026, except for $210,767 paid in January 2020. On May 29, 2020, the Company entered into an Early Payment Agreement and Escrow Instruction (the “Early Payment Agreement”) pursuant to which the Company agreed to pay $15.0 million to the investor in early satisfaction of the Balloon Payment Obligation. The parties to the Early Payment Agreement acknowledged and agreed that the remaining fixed payments other than the Balloon Payment Obligation remain due and payable pursuant to the terms of the Agreement, and that nothing in the Early Payment Agreement alters, amends, or waives any provisions or obligations in the Waiver or the Investor agreement other than as expressly set forth therein. In addition, the Company acquired a Supply and Distribution Agreement with Tris Pharma, Inc. ("TRIS"), (the “Karbinal Agreement”), under which the Company is granted the exclusive right to distribute and sell the product in the United States. The initial term of the Karbinal Agreement was 20 years. The Company will pay TRIS a royalty equal to 23.5% of net sales. A third party agreed to offset the 23.5% royalty payable by 8.5%, for a net royalty equal to 15% , in fiscal year 2018 and 2019 for net sales of Karbinal. The Karbinal Agreement make-whole payment is capped at $2,100,000 each year. The Karbinal Agreement also contains minimum unit sales commitments, which is based on a commercial year that spans from August 1 through July 31, of 70,000 units through 2025. The Company is required to pay TRIS a royalty make whole payment of $30 for each unit under the 70,000 -unit annual minimum sales commitment through 2025. The annual payment is due in August of each year. The Karbinal Agreement also has multiple commercial milestone obligations that aggregate up to $3.0 million based on cumulative net sales, the first of which is triggered at $40.0 million of net revenues. Inventory Purchase Commitment On May 1, 2020, the Company's Innovus subsidiary entered into a Settlement Agreement and Release (the “Settlement Agreement”) with Hikma Pharmaceuticals USA, Inc. (“Hikma”). Pursuant to the settlement agreement, Innovus has agreed to purchase and Hikma has agreed to manufacture a minimum amount of our branded fluticasone propionate nasal spray USP, 50 mcg per spray (FlutiCare®), under Hikma's FDA approved ANDA No. 207957 in the U.S. The commitment requires Innovus to purchase three batches of product through fiscal year 2022 each of which amount to $1.0 million. CVR Liability On February 14, 2020, the Company closed on the Merger with Innovus Pharmaceuticals after approval by the stockholders of both companies on February 13, 2020. Upon closing the Merger, a subsidiary of the Company merged with and into Innovus and entered into a Contingent Value Rights Agreement (the “CVR Agreement”). Each CVR entitles its holder to receive its pro rata share, payable in cash or stock, at the option of Aytu, of certain payment amounts if the targets are met. If any of the payment amounts is earned, they are to be paid by the end of the first quarter of the calendar year following the year in which they are earned. Multiple revenue milestones can be earned in one year. On March 31, 2020, the Company paid out the first CVR Milestone in the form of approximately 120 thousand shares of the Company's common stock to satisfy the $2.0 million obligation as a result of Innovus achieving the $24.0 million revenue milestone for calendar year ended December 31, 2019. As a result of this, the Company recognized a gain of approximately $0.3 million during the fiscal year ended June 30, 2020 . No additional milestone payments have been paid as of December 31, 2020 . Product Contingent Liability In February 2015, Innovus acquired Novalere, which included the rights associated with distributing FlutiCare. As part of the Merger, Innovus is obligated to make 5 additional payments of $0.5 million each when certain levels of FlutiCare sales are achieved. The discounted value as of December 31, 2020, is approximately $0.2 million. Product Milestone Payments In connection with the Company's intangible assets, Aytu has certain milestone payments, totaling $3.0 million, payable at a future date, are not directly tied to future sales, but upon other events certain to happen. These obligations are included in the valuation of the Company's contingent consideration (see Note 9 ).

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