The Company leases an office building and equipment from Areth, LLC (“Areth”) pursuant to a shared services agreement on a month-to-month basis of which terms had been amended by the Company’s Board of Directors in June 2016. Effective October 1, 2017, monthly rent on this facility was reduced to $10,000. Rent expense amounted to $30,000 and $48,000 for the three months ended March 31, 2018 and 2017, respectively. Areth is a company controlled by Dr. Jerrold B. Grossman, the Company’s Vice Chairman, and Adam S. Grossman, the Company’s President and Chief Executive Officer. The Company pays Areth monthly fees for the use of such office space and for other information technology, general warehousing and administrative services. The Company also reimburses Areth for office and building related (common area) expenses, equipment and certain other operational expenses, which were not material to the consolidated financial statements for the three months ended March 31, 2018 and 2017. 

As part of the Biotest Transaction, the Company issued a $15.0 million subordinated note payable to BPC (see Note 4), and recognized interest expense on this note for the three months ended March 31, 2018 in the amount of $0.2 million.

For the three months ended March 31, 2018 and 2017, the Company recognized revenues under its out-licensing agreement with Biotest of approximately $36,000. Deferred revenue of $2.7 million as of March 31, 2018 and December 31, 2017 is related to this agreement.

Biotest is the Company’s largest customer for the sale of normal source plasma. Plasma sales to Biotest for the three months ended March 31, 2018 and 2017 were $2.3 million and $2.1 million, respectively. Accounts receivable includes $0.7 million and $1.2 million due from Biotest as of March 31, 2018 and December 31, 2017, respectively. Additionally, Biotest is a supplier of plasma to ADMA, with the Company purchasing $0.7 million and $0.2 million of plasma in the three months ended March 31, 2018 and 2017, respectively. Included in accounts payable is $0.1 million due to Biotest as of March 31, 2018 and December 31, 2017. The following table summarizes the related party balances with Biotest:

In connection with the acquisition of the Biotest Assets, the Company entered into a Transition Services Agreement with BPC pursuant to which each of the Company and BPC agreed to provide transition services to the other party, including services related to finance, human resources, information technologies, leasing of equipment and clinical and regulatory services for a period of up to 24 months after the June 6, 2017 closing date, as well as agreements to lease certain laboratory space within the Boca Facility to BPC for a period of up to 24 months after the closing date of the acquisition transaction. As of March 31, 2018 and December 31, 2017, $0.4 million and $0.3 million, respectively, was payable by the Company to BPC for services rendered and expenses incurred on behalf of the Company related to these agreements. This amount is reflected in accrued expenses in the accompanying consolidated balance sheets. 

Under the terms of the acquisition of the Biotest Assets, the Company will transfer ownership of two plasma collection centers to BPC on January 1, 2019. The Company has estimated the fair value of these assets to be $12.6 million, and the obligation to transfer these assets to Biotest is reflected in non-current liabilities in the accompanying consolidated balance sheet as of March 31, 2018 and December 31, 2017. The services component of amounts billed to the Company by BPC for the three months ended March 31, 2018 was not material to the Company’s consolidated financial statements.