1)

During the years ended June 30, 2012 and 2011, the Company maintained a license agreement with its Former Parent. The Company earned royalties of approximately $34,000 and $23,000 during the years ended June 30, 2012 and 2011, respectively. A shareholder of the Company is also an officer of the Former Parent.

2)

During the years ended June 30, 2012 and 2011, the Company had four service arrangements with the Center for Molecular Biotechnology of Fraunhofer USA, Inc. (“FhCMB”) for research and development. During part of the year ended June 30, 2012 and the entire year ended June 30, 2011, the Company’s CSO was an Executive Officer of FhCMB. Since March 1, 2012, this former CSO has a consulting agreement to be the Company’s Scientific Advisor.

A)

In 2003, the Company entered into a TTA which requires FhCMB to provide the Company with research and development services related to the commercialization of the Technology and allows FhCMB to apply the Technology to the development and production of certain vaccines for use in developing countries as defined in the agreement. The most recent amendment to the TTA requires: 1) the Company to make payments to FhCMB of $2,000,000 per year for five years, aggregating $10,000,000, for such services beginning in November 2009; and 2) FhCMB to expend at least equal amounts during the same timeframe for research and development services related to the commercialization of the Technology. Additionally, under the terms of the TTA and for a period of 15 years: 1) the Company shall pay FhCMB a defined percent (per the agreement) of all receipts derived by the Company from sales of products produced utilizing the Technology and a defined percentage (per the agreement) of all receipts derived by the Company from licensing the Technology to third parties with an overall minimum annual payment of $200,000 beginning with the twelve months ended December 2010; and 2) FhCMB shall pay the Company a defined percentage (per the agreement) of all receipts from sales, licensing, or commercialization of the Technology in developing countries as defined in the agreement. All new intellectual property invented by FhCMB during the period of the TTA is owned by and is required to be transferred to iBio. The expense for the year ended June 30, 2012 and 2011 was approximately $2,200,000 and $1,533,000, respectively. During the year ended June 30, 2010, the Company expensed the second $1,000,000 obligation under this agreement to pay for a cGMP plant at FhCMB. Because of the timing of the obligation, there was no prepaid balance to expense during the year ended June 30, 2011. The Company has consistently applied the accounting treatment as the expense is recorded and as services are rendered. The Company is charged interest by FhCMB on certain outstanding balances at prime plus 2 percent.

B)

In December 2010, the Company and FhCMB entered into a $1,660,000 research services agreement to evaluate gene expression and protein production, focused on a series of product candidates, using the iBioLaunch platform. The expense for the years ended June 30, 2012 and 2011 was approximately $643,000 and $457,000, respectively.

C)

In March 2011, the Company and FhCMB entered into a $432,000 research services agreement for the evaluation of the mechanism of immune-potentiating activity of lichenase (“LicKM”), which is a thermostable bacterial enzyme used as a carrier molecule for vaccine antigens. The value of LicKM is as an immunomodulator. Fraunhofer completed their research during the year ended June 30, 2012 and the Company recorded the entire cost of the agreement as of June 30, 2012. The expense for the years ended June 30, 2012 and 2011 was $296,000 and $135,000 respectively.

D)

In January 2011, the Company has a commercial, royalty-bearing license to Fiocruz/Bio-Manguinhos (“Fiocruz”) of Brazil to develop, manufacture and sell certain vaccines based upon our proprietary technology. Fiocruz is expected to invest $6,500,000 to bring the first product candidate, a new yellow fever vaccine, through a Phase I clinical trial. iBio engaged FhCMB to perform research and development activity in conjunction with this contract. The expected research and development expense to service this opportunity is approximately $6,500,000. The Company does not expect to earn a profit until it receives a license fee. The expense for the years ended June 30, 2012 and 2011 was approximately $1,277,000 and $520,000, respectively.

E)

Pursuant to an agreement, FhCMB is required to reimburse the Company for patent related costs. Included in current receivables and other current assets as of June 30, 2012 and 2011, there is approximately $177,000 and $223,000, respectively. The Company recorded a $100,000 vendor concession to general and administrative expenses and reduced the asset to its net realizable value during the year ended June 30, 2012.

Below are expenses recorded for transactions associated with FhCMB for the years ended June 30, 2012 and 2011 and amounts included in the balance sheet for accounts as of June 30, 2012 and 2011:

For the Year
Ended June
30, 2012

For the Year
Ended June
30, 2011

Research and development expenses

$4,216,000

$2,445,000

Royalty expenses

200,000

200,000

Interest expense

62,000

50,000

As of June
30, 2012

As of June
30, 2011

Prepaid expenses, other receivable and other current assets

$844,000

$983,000

Accounts payable and accrued expenses

2,591,000

2,360,000

3)

On February 1, 2012, the Company entered into a consulting agreement with a member of the Board of Directors, primarily for business development. The agreement is for six months at $15,000 per month and 60,000 options to purchase common stock at $0.93 per share. These options vest in six equal monthly installments of 10,000 and expire in ten years. The consulting expense for the year ended June 30, 2012 was $75,000. The Company pays an annual fee of $10,000 to a member of the Board of Directors per year. The aggregate expense for the years ended June 30, 2012 and 2011 was $85,000 and $1,000, respectively.

4)

On March 1, 2012, the Company’s CSO ceased his employment as CSO and instead became a consultant to the Company as its Chief Scientific Advisor. As of February 29, 2012, the former CSO had a prior outstanding option grant to purchase 500,000 shares of common stock of which 200,000 were vested. As compensation for his prospective role as Chief Scientific Advisor, the 300,000 unvested options that the former CSO had were allowed to continue to vest in accordance with the original terms of his option award agreement. The fair market value of this non-employee option award at the date of grant for the unvested options was $234,000, and will continue to be amortized over the vesting terms. The initial option was granted on February 25, 2010 with an exercise price of $0.87 per share, and expires in ten years subject to other vesting conditions. The remaining options will vest ratably on January 1, 2013 and on each of the two subsequent anniversary dates.

5)

The Company entered into an agreement during the year ended June 30, 2012, with a vendor, whose minority stockholder is the President of the Company. The vendor performs laboratory feasibility analyses of gene expression and protein purification and also preparation of research samples. The expense for the years ended June 30, 2012 and 2011 approximated $225,000 and $0, respectively. Included in accounts payable at June 30, 2012 and 2011, was approximately $64,000 and $0, respectively.