Note 2 – Intangible Assets

Intangible assets at September 30, 2019 and December 31, 2018 consisted of the following:

Amortization expense was $198,832 and $200,256 for the three months ended September 30, 2019 and 2018, respectively, and $596,496 and $422,814 for the nine months ended September 30, 2019 and 2018, respectively. This expense is included within research and development expense in the accompanying condensed consolidated statements of operations. Our estimated amortization expense for the next year will be approximately $795,000 and approximately $788,000 per year for annual periods thereafter.

The capitalized costs for the license rights to PCS-499 included the $8 million purchase price, $1,782 in transaction costs and $3,037,147 associated with the initial recognition of an offsetting deferred tax liability related to the acquired temporary difference for an asset purchased that is not a business combination and has a tax basis of $1,782 in accordance with ASC 740-10-25-51 Income Taxes. In accordance with ASC Topic 730, Research and Development, we capitalized the costs of acquiring the exclusive license rights to PCS-499, as the exclusive license rights represent intangible assets to be used in research and development activities that management believes has future alternative uses.