NOTE 7 — COMMITMENTS AND CONTINGENCIES

Commitments

Please refer to Notes 4 and 5 for further discussion of commitments to make milestone payments and to pay royalties under license agreements, and to make certain qualified expenditures related to the Company’s restricted cash balance.

Legal Matters

From time to time, the Company may be involved in litigation relating to claims arising out of operations in the normal course of business. As of December 31, 2019, there were no pending or threatened lawsuits that could reasonably be expected to have a material effect on the Company’s results of operations. At each reporting period, the Company evaluates whether or not a potential loss amount or a potential range of loss is probable and reasonably estimable under ASC 450, Contingencies. Legal fees are expensed as incurred.