Pernix Therapeutics 10-Q 13 Nov 18 2018 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2018	Nov. 06, 2018
Document Information [Line Items]
Entity Registrant Name	PERNIX THERAPEUTICS HOLDINGS, INC.
Entity Central Index Key	1,024,126
Document Type	10-Q
Document Period End Date	Sep. 30, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Small Business	true
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Non-accelerated Filer
Entity Emerging Growth Company	false
Entity Common Stock, Shares Outstanding		14,505,848
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2,018

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Current assets:
Cash and cash equivalents	$ 24,511	$ 32,820
Accounts receivable, net	66,443	45,317
Inventory, net	17,788	5,396
Prepaid expenses and other current assets	11,935	8,628
Income tax receivable	45	123
Total current assets	120,722	92,284
Property and equipment, net	1,000	752
Goodwill	17,572	12,100
Intangible assets, net	133,649	96,606
Other	1,827	2,263
Total assets	274,770	204,005
Current liabilities:
Accounts payable	11,302	7,911
Accrued personnel expenses	5,181	5,748
Accrued allowances	71,698	56,309
Other accrued expenses	10,148	6,909
Interest payable	6,381	10,612
Treximet Secured Notes - current, net	0	3,664
Other liabilities - current	6,901	2,648
Total current liabilities	111,611	93,801
Term loan	41,250	0
Convertible notes - long-term, net	67,823	65,194
Exchangeable notes - long-term, net	10,030	7,975
Delayed draw term loan - long-term, net	37,805	27,248
Derivative liability	54	93
Contingent consideration	1,501	1,358
Treximet Secured Notes - long-term, net	151,364	163,887
Credit facility	14,185	14,185
Deferred revenue	10,840	0
Arbitration award	0	2,000
Other liabilities - long-term	589	2,521
Total liabilities	447,052	378,262
Commitments and contingencies (note 13)
Stockholders' deficit:
Preferred stock	1	0
Common stock, $0.01 par value, 140,000,000 shares authorized, 13,957,733 and 11,841,173 shares issued and outstanding at September 30, 2018 and December 31, 2017, respectively	140	119
Additional paid-in capital	274,458	261,158
Accumulated other comprehensive loss	85	0
Accumulated deficit	(479,476)	(435,534)
Total Pernix stockholders' deficit	(204,792)	(174,257)
Noncontrolling interests	32,510	0
Total stockholders' deficitty	(172,282)	(174,257)
Total liabilities and stockholders' deficit	$ 274,770	$ 204,005

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) (Parenthetical) - $ / shares	Sep. 30, 2018	Dec. 31, 2017
Stockholders Equity
Common stock par value	$ 0.01	$ 0.01
Common stock shares authorized	140,000,000	140,000,000
Common stock shares issued	13,957,733	11,841,173
Common stock shares outstanding	13,957,733	11,841,173
Preferred Stock
Stockholders Equity
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	8,500,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Series C Convertible Preferred Stock [Member]
Stockholders Equity
Preferred stock, par value	$ 0.01
Preferred stock, shares authorized	1,500,000
Preferred stock, shares issued	81,000
Preferred stock, shares outstanding	81,000

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (USD $) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Income Statement [Abstract]
Net revenues	$ 37,156	$ 40,469	$ 86,383	$ 104,527
Costs and operating expenses:
Cost of product sales	11,823	10,580	26,353	31,113
Selling, general and administrative expense	31,872	20,226	67,412	59,519
Research and development expense	1,524	99	1,534	709
Depreciation and amortization expense	2,391	18,214	13,686	54,976
Change in fair value of contingent consideration	0	884	143	344
Loss from disposal and impairments of assets	75	25	75	25
Gain from legal settlement	0	(10,476)	0	(10,476)
Restructuring costs	(2)	(97)	1,212	34
Total costs and operating expenses	47,683	39,455	110,415	136,244
Income (loss) from operations	(10,527)	1,014	(24,032)	(31,717)
Other income (expense):
Interest expense	(10,073)	(9,323)	(29,063)	(27,491)
Gain on sale of assets	0	0	446	0
Change in fair value of derivative liability	18	46	39	(38)
Gain from exchange of debt	137	14,650	137	14,650
Foreign currency transaction gain	(843)	0	(864)	0
Total other expense, net	(10,761)	5,373	(29,305)	(12,879)
Income (loss) before income tax expense	(21,288)	6,387	(53,337)	(44,596)
Income tax expense	61	27	109	122
Net income (loss)	(21,349)	6,360	(53,446)	(44,718)
Adjust: Net loss attributable to noncontrolling interests	9,504	0	9,504	0
Net income (loss) attributable to common stockholders	$ (11,845)	$ 6,360	$ (43,942)	$ (44,718)
Net income (loss) per common share attributable to common stockholders:
Basic	$ (0.89)	$ 0.57	$ (3.55)	$ (4.31)
Diluted	$ (0.89)	$ 0.42	$ (3.55)	$ (4.31)
Weighted-average common shares outstanding:
Basic	13,301	11,117	12,377	10,387
Diluted	13,301	16,520	12,377	10,387

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS COMPREHENSIVE INCOME (LOSS) (USD $) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Income Statement [Abstract]
Net income (loss)	$ (21,349)	$ 6,360	$ (53,446)	$ (44,718)
Other comprehensive income (loss):
Foreign currency translation adjustments	849	0	849	0
Unrealized gain during period, net of tax of $0 and $0, respectively	0	9	0	33
Comprehensive income (loss)	(20,500)	6,369	(52,597)	(44,685)
Less: Comprehensive income attributable to noncontrolling interest	(764)	0	(764)	0
Comprehensive income (loss) attributable to common stockholders	$ (21,264)	$ 6,369	$ (53,361)	$ (44,685)

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) shares in Thousands, $ in Thousands	Series C Convertible Preferred Stock	Common Stock	Additional Paid-In Capital	Treasury Stock	Retained Earnings (Deficit)	Accumulated Other Comprehensive Loss	Total Pernix Stockholder' Deficit	Noncontrolling Interest	Total
Beginning Balance, Amount at Dec. 31, 2016	$ 0	$ 100	$ 244,309	$ 0	$ (358,393)	$ (79)	$ (114,063)	$ 0	$ (114,063)
Beginning Balance, Shares at Dec. 31, 2016	0	10,016
Conversion of restricted stock units, Amount	$ 0	$ 1	(113)	0	0	0	(112)	0	(112)
Conversion of restricted stock units, Shares	0	44
Compensation expense on share-based awards	$ 0	$ 0	2,491	0	0	0	2,491	0	2,491
Issuance of convertible debt, Amount	0	$ 11	12,499	0	0	0	12,510	0	$ 12,510
Issuance of convertible debt, Shares		1,100
Issuance of common stock upon the exercise of stock options, Shares									0
Net proceeds from sale of shares, Amount	0	$ 7	1,972	0	0	0	1,979	0	$ 1,979
Net proceeds from sale of shares, Shares		681
Other comprehensive loss	0	$ 0	0	0	0	79	79	0	79
Net loss	0	0	0	0	(77,141)	0	(77,141)	0	(77,141)
Ending Balance, Amount at Dec. 31, 2017	$ 0	$ 119	261,158	0	(435,534)	0	(174,257)	0	(174,257)
Ending Balance, Shares at Dec. 31, 2017	0	11,841
Capital Contribution - Nalpropion, Amount	$ 0	$ 0	0	0	0	0	0	41,250	41,250
Capital Contribution - Nalpropion, Shares	0	0
Treximet Secured Notes Conversion, Amount	$ 1	$ 18	11,558	0	0	0	11,577	0	11,577
Treximet Secured Notes Conversion, Shares	81	1,855
Conversion of restricted stock units, Amount	$ 0	$ 1	(37)	0	0	0	(36)	0	(36)
Conversion of restricted stock units, Shares		71
Compensation expense on share-based awards	0	$ 0	1,328	0	0	0	1,328	0	1,328
Net proceeds from sale of shares, Amount	0	$ 2	451	0	0	0	453	0	453
Net proceeds from sale of shares, Shares		191
Other comprehensive loss	0	$ 0	0	0	0	85	85	764	849
Net loss	0	0	0	0	(43,942)	0	(43,492)	(9,504)	(43,942)
Ending Balance, Amount at Sep. 30, 2018	$ 1	$ 140	$ 274,458	$ 0	$ (479,476)	$ 85	$ (204,792)	$ 32,510	$ (172,282)
Ending Balance, Shares at Sep. 30, 2018	81	13,958

CONDENSED CONSOLIDATED STATEM_4

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Cash flows used in operating activities:
Net loss	$ (53,446)	$ (44,718)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation	316	277
Amortization of intangibles	13,457	54,788
Amortization of deferred financing costs	2,839	2,376
Accretion expense	3,806	3,837
PIK Interest	1,409	0
Amortization of acquisition related inventory step-up	2,239	0
Stock compensation expense	1,328	1,935
Unrealized foreign currency loss	737	0
Fair market value change in contingent consideration	143	344
Fair market value change in derivative liability	(39)	38
Gain from legal settlement	0	(10,476)
Gain from exchange of debt	(137)	(14,650)
Impairment of fixed assets	75	25
Gain on sale of assets	(446)	0
(Increase) decrease in operating assets, net of effects of acquisitions:
Accounts receivable	6,487	2,361
Income tax receivable	78	985
Inventory	3,556	(355)
Prepaid expenses and other assets	(3,605)	(6,605)
Increase (decrease) in operating liabilities, net of effects of acquisitions:
Accounts payable and accrued expenses	(293)	(2,979)
Accrued allowances	2,441	(2,707)
Interest payable	(3,980)	(5,026)
Other liabilities	(2,360)	(1,878)
Net cash used in operating activities	(25,395)	(9,218)
Cash flows from investing activities:
Acquisition of Orexigen, net of cash acquired	(69,225)	0
Proceeds from sale of non-core assets	446	0
Purchase of software and equipment	(139)	(5)
Net cash used in investing activities	(68,918)	(5)
Cash flows from financing activities:
Nalpropion - Capital Contribution	41,250	0
Proceeds from 2018 Term Loan	41,250	0
Net proceeds from Delayed Draw Term Loan	9,167	30,000
Payments on Treximet Secured Notes	(5,373)	(17,511)
Payment on financing costs	(221)	(13,586)
Net payments on credit facilities	0	185
Payments on mortgages and capital leases	(38)	(55)
Proceeds from issuance of common stock, net of tax and costs	453	1,123
Shares withheld for the payment of taxes	(37)	(67)
Stock issuance costs	(549)	0
Net cash provided by financing activities	85,902	89
Effect of exchange rate changes on cash and cash equivalents	102	0
Net decrease in cash and cash equivalents	(8,309)	(9,134)
Cash and cash equivalents, beginning of period	32,820	36,375
Cash and cash equivalents, end of period	$ 24,511	$ 27,241

1. Company Overview

1. Company Overview	9 Months Ended
	Sep. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
1. Company Overview	Note 1. Company Overview Pernix® Therapeutics Holdings, Inc. and subsidiaries (collectively, Pernix, the Company, we, our and us) is a specialty pharmaceutical company focused on the acquisition, development and commercialization of prescription drugs, primarily for the United States (U.S.) market. The Company is currently focused on the therapeutic areas of pain and neurology and has an interest in expanding into additional specialty segments. The Company promotes its branded products to health care professionals through its Pernix sales force and markets its generic portfolio through its wholly owned subsidiaries, Macoven™ Pharmaceuticals, LLC (Macoven) and Cypress Pharmaceuticals®, Inc. (Cypress). The Company's branded products include Zohydro® ER with BeadTek® (Zohydro ER), an extended-release opioid agonist indicated for the management of pain severe enough to require daily, around-the-clock, long-term opioid treatment and for which alternative treatment options are inadequate, Treximet® a medication indicated for the acute treatment of migraine attacks with and without aura, and Silenor® a non-controlled substance and approved medication for the treatment of insomnia characterized by difficulty with sleep maintenance. Subsequent Events Departure of Angus Smith, Senior Vice President, Chief Business Officer and Principal Financial Officer On October 26, 2018, Angus Smith notified the Company of his decision to resign as the Company's Senior Vice President, Chief Business Officer and Principal Financial Officer, effective as of November 23, 2018 (the "Effective Date"), to pursue other opportunities. Mr. Smith will continue in his current role through the Effective Date to assist with the transition of his responsibilities and other related matters. The Company has designated Glenn Whaley, the Company's Vice President of Finance, Principal Accounting Officer and Corporate Controller, as principal financial officer of the Company to succeed Mr. Smith, effective as of the Effective Date. As of the Effective Date, Mr. Whaley's title will be Vice President of Finance, Principal Financial and Accounting Officer. Nasdaq Deficiency Notices On October 17, 2018, the Company received notice (the Minimum Market Value of Publicly Held Shares Notice) from the Nasdaq Stock Market LLC (Nasdaq) that the Company is not currently in compliance with the $15 million minimum market value of publicly held shares requirement of Nasdaq Listing Rule 5450(b)(3)(C). The Minimum Market Value of Publicly Held Shares Notice indicated that, consistent with Nasdaq Listing Rule 5810(c)(3)(D), the Company has until April 15, 2019 to regain compliance with the minimum market value of publicly held shares requirement by having the closing market value of publicly held shares, calculated by multiplying the closing bid price of the Company's common stock (Common Stock) by the Company's total shares outstanding (less any shares held by officers, directors or beneficial owners of 10% or more of the total shares outstanding ), meet or exceed $15 million for at least ten consecutive business days. On October 19, 2018, the Company received notice (the Minimum Bid Price Notice) from Nasdaq that the Company is not currently in compliance with the $1.00 minimum closing bid price requirement of Nasdaq Listing Rule 5450(a)(1). The Minimum Bid Price Notice indicated that, consistent with Nasdaq Listing Rule 5810(c)(3)(A), the Company has until April 17, 2019 to regain compliance with the minimum bid price requirement by having the closing bid price of the Common Stock meet or exceed $1.00 per share for at least ten consecutive business days. If the Company does not regain compliance with the minimum bid price requirement by April 17, 2019, the Company may be eligible to transfer the listing of the Common Stock from the Nasdaq Global Market to the Nasdaq Capital Market if, at the time of such transfer, the Company meets the initial listing requirement for market value of publicly held shares ($1 million) and all other initial listing standards for the Nasdaq Capital Market (except for the minimum bid price requirement) and provides Nasdaq with written notice of its intention to cure the minimum bid price requirement deficiency. In response, Nasdaq may provide the Company with an additional 180 day period to satisfy the minimum bid price requirement. However, if it appears to the Nasdaq staff that the Company will not be able to cure the deficiency, or if the Company is otherwise not eligible, Nasdaq will provide notice to the Company that the Common Stock will be subject to delisting pursuant to Nasdaq's delisting procedures. The notices do not result in the immediate delisting of the Common Stock from the Nasdaq Global Market. If the Common Stock is delisted from the Nasdaq Global Market, the holders of the Convertible Notes (as defined in Note 10 below) and the Exchangeable Notes (as defined in Note 10 below) would have the right to require the Company (in the case of the Convertible Notes) or Pernix Ireland Pain Designated Activity Company (PIP DAC) (in the case of the Exchangeable Notes) to repurchase all of the Convertible Notes and Exchangeable Notes owned by such holders at a price equal to 100% of the principal amount thereof, plus any accrued and unpaid interest thereon, within 35 business days following the Company or PIP DAC giving notice to such holders of the delisting. The Company's or PIP DAC's failure to pay such amounts when due would result in a default under the indentures governing the Convertible Notes or the Exchangeable Notes, as the case may be, which would ripen into an event of default immediately under the indenture governing the Convertible Notes, and within five days of becoming due under the indenture governing the Exchangeable Notes. Further, an event of default under either of these indentures would result in a cross-default under the Delayed Draw Term Loan (as defined in Note 10 below) as well as the ABL Facility (as defined in Note 10 below), which could result in indebtedness outstanding under those instruments to become immediately due and payable. In addition, any acceleration of the debt under the Convertible Notes, the Exchangeable Notes, the Delayed Draw Term Loan or the ABL Facility would trigger an event of default under the indenture governing the Treximet Secured Notes (as defined in Note 10 below), which could result in such indebtedness becoming immediately due and payable. Going Concern As of October 17, 2018, the Company was not in compliance with certain Nasdaq Global Market listing requirements. The Company's outstanding 4.25% Convertible Notes (as defined in Note 10 below) in the principal amount of $78.2 million that contain redemption features in the event the Company was not able to maintain its Nasdaq Global Market listing. In addition, the Company's outstanding Exchangeable Notes (as defined in Note 10 below) in the principal amount of $36.1 million contain redemption features in the event the Company is not able to maintain any Nasdaq listing. These factors raise substantial doubt about the ability of the Company to continue as a going concern within one year after the date that these financial statements are issued. The Company continues to seek other sources of capital and alternatives. However, if the Company is unable to raise sufficient capital or maintain its Nasdaq listing to prevent the redemption of its outstanding indebtness, the Company will not have sufficient liquidity to fund its business operations for at least the next year following the date that the financial statements are issued. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. Conversion of 0% Series C Perpetual Convertible Preferred Stock On October 3, 2018, holders of 13,100 shares of the Company' 0% Series C Perpetual Convertible Preferred Stock (Convertible Preferred Stock) elected to convert such Convertible Preferred Stock into 548,115 shares of the Common Stock (see note 11, Stockholders' Equity

2. Basis of Presentation and Su

2. Basis of Presentation and Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2018
Accounting Policies [Abstract]
2. Basis of Presentation and Summary of Significant Accounting Policies	Note 2. Basis of Presentation and Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated financial statements included herein have been prepared by the Company in accordance with generally accepted accounting principles in the United States (GAAP) and under the rules and regulations of the United States Securities and Exchange Commission (SEC) for interim reporting. In management's opinion, the interim financial data presented includes all adjustments (consisting solely of normal recurring items) necessary for fair presentation. All intercompany accounts and transactions have been eliminated. Certain information required by GAAP has been condensed or omitted in accordance with rules and regulations of the SEC. Operating results for the three and nine months ended September 30, 2018 are not necessarily indicative of the results that may be expected for any future period or for the year ending December 31, 2018. These unaudited condensed consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements and the notes thereto for the year ended December 31, 2017, included in Pernix's 2017 Annual Report on Form 10-K filed with the SEC. The preparation of the unaudited condensed consolidated financial statements requires management to make estimates and assumptions relating to reporting of the assets and liabilities and the disclosure of contingent assets and liabilities to prepare these unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period in conformity with GAAP. Significant estimates of the Company include: revenue recognition, sales allowances such as returns on product sales, government program rebates, customer coupon redemptions, wholesaler/pharmacy discounts, product service fees, rebates and chargebacks, sales commissions, amortization, stock-based compensation, the determination of fair values of assets and liabilities in connection with business combinations, and deferred income taxes. Actual results could differ from these estimates. Certain prior period amounts have been reclassified to conform to the current period presentation including reclassifying capitalized debt issuance costs of approximately $1.5 million from "Prepaid expenses and other current assets" to the Company's long-term debt instruments within "Total liabilities" except for those related to revolving credit facilities. This reclassification had no effect on previously reported results of operations, financial position or cash flows. Principles of Consolidation The unaudited condensed consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries, and variable interest entities (VIEs) for which the Company is the primary beneficiary. All significant intercompany balances and transactions have been eliminated in consolidation. The Company evaluates its ownership, contractual, and other interests in entities that are not wholly owned to determine if these entities are VIEs, and, if so, whether the Company is the primary beneficiary of the VIE. In determining whether the Company is the primary beneficiary of a VIE and therefore required to consolidate the VIE, a qualitative approach is applied that determines whether the Company has both (1) the power to direct the activities of the VIE that most significantly impact the VIE's economic performance and (2) the obligation to absorb losses of, or the rights to receive benefits from, the VIE that could potentially be significant to that VIE. The Company will continuously assess whether it is the primary beneficiary of a VIE as changes to existing relationships or future transactions may result in the consolidation or deconsolidation of such VIE. During the three and nine months ended September 30, 2018, the Company's consolidated VIE includes Nalpropion™ Pharmaceuticals Inc. (Nalpropion), and the Company remains the primary beneficiary of Nalpropion (see note 4, Variable Interest Entity Recently Adopted Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers (Topic 606) Revenue from Contracts with Customers The Company's new revenue recognition policy is as follows: Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those products or services. The Company generally enters into contracts to sell approved branded and generic pharmaceutical drugs. Product Sales Product sales revenue is recognized at the estimated consideration to be received when control has transferred to the customer, which is typically on delivery to the customer or, in the case of products that are subject to consignment agreements, when the customer removes product from the Company's consigned inventory location for shipment directly to a patient. Payment terms vary by customer and the products or services offered and is generally required in a term ranging from 30 to 90 days from date of shipment or satisfaction of the performance obligation. Significant Judgments Product sales contracts provide the customer with the right to return the product and also provide for a variety of discounts and allowances including, specialty distributor fees, wholesaler fees, prompt payment discounts, government rebates, government chargebacks, coupon programs and rebates under managed care plans which are accounted for as variable consideration. Returns are estimated through comparison of historical return data to their related sales on a production lot basis. Historical rates of return are determined for each product and are adjusted for known or expected changes in the marketplace specific to each product, when appropriate. Judgment is required to estimate the appropriate adjustments for variable consideration which is based on sales or invoice data, contractual terms, historical utilization rates, new information regarding changes in these programs regulations and guidelines that would impact the amount of the actual rebates, the Company's expectations regarding future utilization rates for these programs and channel inventory data. Contract Balances The timing of customer invoicing generally does not differ from the timing of revenue recognition. The Company records provisions for returns, specialty distributor fees, wholesaler fees, government rebates, coupon programs and rebates under managed care plans are included within current liabilities in the Company's consolidated balance sheets. Provision for prompt payment discounts are generally shown as a reduction in accounts receivable. In May 2017, the FASB issued ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting, In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business In August 2016, the FASB issued ASU 2016-15 Statement of Cash Flows - Classification of Certain Cash Receipts and Cash Payments In January 2016, the FASB issued ASU 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities Recently Issued Accounting Standards, Not Adopted as of September 30, 2018 In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820) - Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement In March 2018, the FASB issued ASU No. 2018-05, Income Taxes (Topic 740): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118 Income taxes In February 2016, the FASB issued ASU no. 2016-02, Leases Management does not believe that any other recently issued, but not yet effective, accounting standards if currently adopted would have a material effect on the Company's consolidated financial statements. Significant Customers The Company's customers consist of drug wholesalers, specialty pharmacies, retail drug stores, mass merchandisers and grocery store pharmacies in the United States. The Company primarily sells its products directly to large national drug wholesalers, which in turn resell the products to smaller or regional wholesalers, retail pharmacies, chain drug stores, and other third parties. The following tables list the Company's customers that individually comprised greater than 10% of total gross product sales for the three and nine months ended September 30, 2018 and 2017, or 10% of total accounts receivable as of September 30, 2018 and December 31, 2017. Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 McKesson Corporation 39% 35% 35% 34% AmerisourceBergen Drug Corporation 26% 29% 26% 30% Cardinal Health, Inc. 25% 23% 24% 24% Total 90% 87% 85% 88% Accounts Receivable, net: September 30, December 31, 2018 2017 McKesson Corporation 37% 29% Cardinal Health, Inc. 29% 31% AmerisourceBergen Drug Corporation 27% 27% Total 93% 87%

3. Business Combinations_Divest

3. Business Combinations/Divestitures	9 Months Ended
	Sep. 30, 2018
Business Combinations [Abstract]
3. Business Combinations/Divestitures	Note 3. Business Combinations/Divestitures Closing of Transactions Regarding Worldwide Rights to Contrave (naltrexone HCl / bupropion HCl) On April 17, 2018, PIP DAC entered into a commitment letter (the Commitment Letter) pursuant to which PIP DAC committed to provide Nalpropion with $7.5 million in debt and/or equity capital to fund Nalpropion's purchase of certain assets of Orexigen® Therapeutics, Inc. (Orexigen) on the terms and conditions contained in the Commitment Letter. Nalpropion is a special purpose vehicle jointly owned by PIP DAC and certain other co-investors. Nalpropion submitted a "stalking horse" bid to purchase certain assets of Orexigen, which filed a voluntary petition for relief under Chapter 11 of Title 11 of the United States Code, 11 U.S.C. §§ 101, et seq. in the United States Bankruptcy Court for the District of Delaware. On June 22, 2018, the Company announced that no other bids for Orexigen's assets were received by the court-approved bid deadline and, on July 27, 2018, Nalpropion acquired substantially all of the assets of Orexigen, including worldwide rights to Contrave® (Contrave), a prescription-only weight loss medication (the Orexigen Acquisition). The purchase price for the Orexigen Acquisition was $73.5 million with $5 million held back to cover potential indemnification claims. The Company, through PIP DAC, received two purchase options that will enable it to acquire up to 49.9% and 100% of Nalpropion at specified time periods and purchase prices. Nalpropion financed the Orexigen acquisition utilizing capital sourced from PIP DAC and certain other co-investors, including the full amount of borrowing available, from its 2018 Term Loan facility as defined and as discussed in Note 10. PIP DAC provided capital of $7.35 million, and an incremental $1.82 million for working capital requirements via its existing delayed draw term loan facility, which is structured as a 50% loan and 50% equity contribution to Nalpropion. The co-investors contributed $66.15 million and an incremental $16.35 million for working capital requirements, which was structured as a 50% loan and 50% equity contribution to Nalpropion. PIP DAC and certain affiliates of the co-investors are lenders to Nalpropion under its 2018 Term Loan (see Note 10, Debt and Lines of Credit As Nalpropion qualifies as a VIE based on its governance structure and contractual relationship with the Company, the Company will therefore consolidate Nalpropion in its condensed consolidated financial statements since the Company has the power to direct activities that most significantly impact Nalpropion's economic performance (see Note 4, Variable Interest Entity Business Combinations Fair Value of Consideration Transferred The following table indicates the consideration transferred to effect the Orexigen Acquisition: Preliminary Purchase Price Allocation Cash consideration $ 68,500 Holdback 5,000 Total consideration transferred $ 73,500 Assets Acquired and Liabilities Assumed The following table summarizes the estimated fair values of the assets acquired and liabilities assumed as of the acquisition date. The following recognized amounts are provisional and subject to change: amounts for intangible assets, property and equipment, certain liabilities, and other working capital balances pending finalization of the valuation; and amount of goodwill pending the completion of the valuation of the assets acquired and liabilities assumed. Amounts Recognized as of the Acquisition Date Cash and cash equivalents $ 730 Accounts receivable 27,700 Inventory (a) 18,219 Prepaids and other current assets 344 Property and equipment 426 Intangible assets (b) 50,500 Goodwill (c) 5,472 Accounts payable (1,097) Accrued allowances (13,574) Accrued personnel expense (841) Other liabilities - current (1,877) Deferred revenue (12,502) $ 73,500 _________________________ (a) Includes an estimated fair value step-up adjustment to inventory of $5.6 million. (b) The following table summarizes the preliminary amounts and useful lives assigned to identifiable intangible assets: Preliminary Intangible Estimated Asset Useful Valuation Life Acquired developed technologies $ 44,800 10 years Tradenames 4,800 12 years Other 900 5 years $ 50,500 (c) Goodwill is calculated as the difference between the acquisition date fair value of the consideration transferred and the values assigned to the assets acquired and liabilities assumed. None of the goodwill is expected to be deductible for tax purposes. The goodwill recorded represents the following: cost savings and operating synergies expected to result from utilizing the Company's shared services; intangible assets that do not qualify for separate recognition (for instance, assembled workforce) and the residual amount paid not allocated to other net assets acquired. Nalpropion will finalize these amounts as it obtains the information necessary to complete the measurement process. Any changes resulting from facts and circumstances that existed as of the acquisition date may result in retrospective adjustments to the provisional amounts recognized at the acquisition date. These changes could be significant. Nalpropion will finalize these amounts no later than one year from the acquisition date. To date, Nalpropion has incurred $3.9 million in transaction costs directly related to the Orexigen Acquisition, which includes expenditures for advisory, legal, valuation, accounting and other similar services. These costs have been expensed as acquisition-related costs and is included in selling, general and administrative expenses. Pro Forma Information The following table represents the consolidated financial information for the Company on a pro forma basis, assuming that the Orexigen Acquisition occurred as of January 1, 2017. The historical financial information has been adjusted to give effect to pro forma items that are directly attributable to the Orexigen Acquisition and are expected to have a continuing impact on the consolidated results. These items include, among others, adjustments to record the amortization of definite-lived intangible assets and interest expense. Additionally, the following table sets forth unaudited financial information and has been compiled from historical financial statements and other information, but is not necessarily indicative of the results that actually would have been achieved had the transactions occurred on the dates indicated or that may be achieved in the future. Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Net revenues $ 40,868 $ 59,372 $ 132,572 $ 165,931 Net income (loss) attributable to Pernix (22,371) 4,372 (59,890) (55,574) Net income (loss) per share attributable to Pernix: Basic $ (1.68) $ 0.39 $ (4.84) $ (5.35) Diluted $ (1.68) $ 0.30 $ (4.84) $ (5.35) Sale of Non-Core Assets On May 29, 2018, the Company received proceeds of $446,000 from the sale of certain obsolete equipment and was recorded as a Gain on sale of assets line in the unaudited condensed consolidated statements of operations for the nine months ended September 30, 2018. On November 6, 2017, the Company announced the sale of a non-core product, Cedax (ceftibuten capsules and ceftibuten for oral suspension), a third-generation cephalosporin antibiotic for the treatment of acute bacterial exacerbations of chronic bronchitis and middle ear infection, to SI Pharmaceuticals, LLC, for $2.0 million in gross cash proceeds. Cedax was discontinued by Pernix in 2016 and the Company did not generate any sales from this product in 2017.

4. Variable Interest Entity

4. Variable Interest Entity	9 Months Ended
	Sep. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Note 4. Variable Interest Entity	Note 4. Variable Interest Entity The Company evaluates its investment in Nalpropion in accordance with the variable interest model to determine whether it has a controlling financial interest in an investment. This evaluation is made as of the date on which the Company makes its initial investment, and subsequent evaluations are made if the structure of the investment changes. If the Company determines that Nalpropion is a VIE, then the Company evaluates whether Nalpropion is required to be consolidated. When the Company holds rights that give it the power to direct the activities of an entity that most significantly impact the entity's economic performance, combined with the obligation to absorb an entity's losses or the right to receive benefits, the Company consolidates a VIE. This determination may involve complex and subjective analyses. As of September 30, 2018, the Company holds a variable interest in Nalpropion, for which the primary beneficiary of the VIE needs to be determined. The Company has concluded, based on its qualitative consideration of the relationship with Nalpropion and by virtue of the management agreement whereby the Company will assume responsibility for product distribution in the United States and managing Nalpropion, that the Company is the primary beneficiary of Nalpropion. When the Company consolidates a VIE, it discloses the noncontrolling interest of investors other than the Company in its consolidated financial statements. The following items of Nalpropion are included in the Company's condensed consolidated statement of operations for the three and nine months ended September 30, 2018: Three Months Ended September 30, 2018 Pernix Nalpropion Eliminations (1) Total Company Net revenues incl. related party $ 20,544 $ 17,923 $ (1,311) $ 37,156 Costs and operating expenses: Cost of product sales 6,470 6,664 (1,311) 11,823 Selling, general and administrative expense 14,857 17,015 - 31,872 Research and development expense 2 1,522 - 1,524 Depreciation and amortization expense 1,434 957 - 2,391 Other operating expenses 73 - - 73 Total costs and operating expenses 22,836 26,158 (1,311) 47,683 - - Income (loss) from operations (2,292) (8,235) - (10,527) Other income (expense): Interest expense, net (9,409) (664) (10,073) Other, net (83) (1,661) 1,056 (688) Total other income (expense), net (9,492) (2,325) 1,056 (10,761) Income (loss) before income tax expense $ (11,784) $ (10,560) $ 1,056 $ (21,288) (1) Included in Eliminations are transactions Pernix and Nalpropion enter into with one another. Such transactions include the sale of Contrave inventory from Nalpropion to Pernix and elimination of equity in earnings of Nalpropion. Nine Months Ended September 30, 2018 Pernix Nalpropion Eliminations (1) Total Company Net revenues incl. related party $ 69,771 $ 17,923 $ (1,311) $ 86,383 Costs and operating expenses: Cost of product sales 21,000 6,664 (1,311) 26,353 Selling, general and administrative expense 50,397 17,015 - 67,412 Research and development expense 12 1,522 - 1,534 Depreciation and amortization expense 12,729 957 - 13,686 Other operating expenses 1,430 - - 1,430 Total costs and operating expenses 85,568 26,158 (1,311) 110,415 Income (loss) from operations (15,797) (8,235) - (24,032) Other income (expense): Interest expense, net (28,399) (664) - (29,063) Other, net 363 (1,661) 1,056 (242) Total other income (expense), net (28,036) (2,325) 1,056 (29,305) Income (loss) before income tax expense $ (43,833) $ (10,560) $ 1,056 $ (53,337) (1) Included in Eliminations are transactions Pernix and Nalpropion enter into with one another. Such transactions include the sale of Contrave inventory from Nalpropion to Pernix and elimination of equity in earnings of Nalpropion. The following assets and liabilities of Nalpropion are included in the Company's condensed consolidated balance sheet as of September 30, 2018. As of September 30, 2018 Pernix Nalpropion Eliminations (1) Total Company Cash and cash equivalents (2) $ 18,202 $ 6,309 $ - $ 24,511 Accounts receivable, net (3) 58,907 7,536 - 66,443 Inventory, net 4,174 13,614 - 17,788 Related party receivable 5,841 38,305 (44,146) - Other current assets 4,844 7,136 - 11,980 Property and equipment, net 634 366 - 1,000 Goodwill 12,100 5,472 - 17,572 Intangible assets 84,047 49,602 - 133,649 Investment in VIE 3,528 - (3,528) - Related party loan 4,584 - (4,584) - Other assets 1,827 - - 1,827 - - Total assets $ 198,688 $ 128,340 $ (52,258) $ 274,770 Accounts payable and other accrued expenses $ 15,775 $ 10,856 $ - $ 26,631 Accrued allowances 54,543 17,155 - 71,698 Interest payable 5,784 597 - 6,381 Related party payable 38,305 5,841 (44,146) - Other liabilities - current 5,806 1,095 - 6,901 Long term debt excluding 2018 Term Loan 281,207 - - 281,207 2018 Term Loan - 45,834 (4,584) 41,250 Deferred revenue - 10,840 - 10,840 Other liabilities - long-term 2,144 - - 2,144 Total liabilities 403,564 $ 92,218 $ (48,730) $ 447,052 Total equity (204,876) $ 36,122 $ (36,038) $ (204,792) Noncontrolling interest - - 32,510 32,510 Total liabilities and equity $ 198,688 $ 128,340 $ (52,258) $ 274,770 (1) Included in Eliminations are transactions Pernix and Nalpropion enter into with one another. Such transactions may include the following: • Operating transactions in accordance with a services agreement between Nalpropion and Pernix. • Elimination of investments in Nalpropion. • Elimination of investments in Nalpropion’s earnings. (2) Approximately $12.2 million of cash and cash equivalents related to Nalpropion is held by Pernix at September 30, 2018. (3) Approximately $23.5 million of Pernix's accounts receivable, net includes accounts receivables related to sales of Contrave.

5. Earnings per Share

5. Earnings per Share	9 Months Ended
	Sep. 30, 2018
Earnings Per Share [Abstract]
5. Earnings per Share	Note 5. Earnings per Share Basic net income (loss) per common share is the amount of net income (loss) for the period divided by the weighted average shares of Common Stock outstanding during the reporting period. Diluted income (loss) per common share is the amount of income (loss) for the period plus interest expense on convertible debt divided by the sum of weighted average shares of Common Stock outstanding during the reporting period and weighted average shares that would have been outstanding assuming the issuance of common shares for all dilutive potential common shares. The following table sets forth the computation of basic and diluted net income (loss) per share (in thousands except per share data): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Numerator: Net income (loss) $ (11,845) $ 6,360 $ (43,942) $ (44,718) Denominator - Basic: Weighted-average common shares 13,301 11,117 12,377 10,387 Numerator - Diluted: Net income (loss) $ (11,845) $ 6,360 $ (43,942) $ (44,718) Adjustment for interest, net of income tax effect - 599 - - Net income (loss), adjusted $ (11,845) $ 6,959 $ (43,942) $ (44,718) Denominator - Diluted: Weighted-average common shares 13,301 11,117 12,377 10,387 Effect of dilutive securities: Stock options, Awards and Warrants - 246 - - Exchangeable notes - 5,157 - - Dilutive potential common shares - 5,403 - - Weighted-average common shares, diluted 13,301 16,520 12,377 10,387 Basic income (loss) per share $ (0.89) $ 0.57 $ (3.55) $ (4.31) Diluted income (loss) per share $ (0.89) $ 0.42 $ (3.55) $ (4.31) The following table sets forth the potential common shares that could potentially dilute basic income per share in the future that were not included in the computation of diluted income (loss) per share because to do so would have been anti-dilutive for the periods presented (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Treximet Secured Notes 27,238 - 27,238 - Exchangeable Notes 6,572 - 6,572 1,738 Converible Preferred Stock 3,389 - 3,389 - Stock options and restricted stock units 1,511 370 1,511 562 4.25% Convertible Notes 682 780 682 1,014 Warrants 4 - 4 33 Total potential dilutive effect 39,396 1,150 39,396 3,347

6. Fair Value Measurement

6. Fair Value Measurement	9 Months Ended
	Sep. 30, 2018
Fair Value Disclosures [Abstract]
6. Fair Value Measurement	Note 6. Fair Value Measurement The Company's financial assets and liabilities are measured using inputs from the three levels of the fair value hierarchy. The three levels are as follows: Level 1- Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Level 2- Inputs are other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (i.e., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs). Level 3- Inputs are unobservable and reflect the Company's assumptions that market participants would use in pricing the asset or liability. The Company develops these inputs based on the best information available. Summary of Assets Recorded at Fair Value The Company's cash equivalents are classified within Level 1 of the fair value hierarchy because they are valued using quoted market prices or broker or dealer quotations for similar assets. The Company had no financial assets that are required to be measured at fair value as of September 30, 2018 and December 31, 2017. There were no transfers of assets or liabilities between Level 1 and Level 2 during the three and nine months ended September 30, 2018 and 2017. The carrying amounts reflected in the unaudited condensed consolidated balance sheets for certain short-term financial instruments including accounts receivable, accounts payable, accrued expenses, and other liabilities approximate fair value due to their short-term nature. Summary of Liabilities Recorded at Carrying Value and Fair Value The 4.25% Convertible Notes, Exchangeable Notes, 2018 Term Loan, Delayed Draw Term Loan and the Treximet Secured Notes (each, as defined below in Note 10) are recorded at carrying value. The derivative liability and contingent consideration are recorded at fair value. The fair and carrying value of our debt instruments are detailed as follows (in thousands): As of September 30, 2018 As of December 31, 2017 Fair Carrying Fair Carrying Value Value Value Value 4.25% Convertible Notes $ 33,714 $ 67,823 $ 36,208 $ 65,194 Exchangeable Notes 13,631 10,030 21,375 7,975 2018 Term loan 41,250 41,250 - - Delayed draw term loan 36,940 37,805 30,300 27,248 Derivative liability 54 54 93 93 Contingent consideration 1,501 1,501 1,358 1,358 Treximet Secured Notes 132,335 151,364 139,201 167,551 Total $ 259,425 $ 309,827 $ 228,535 $ 269,419 4.25% Convertible Notes, Exchangeable Notes, 2018 Term Loan and Delayed Draw Term Loan The fair values of the 4.25% Convertible Notes and the Exchangeable Notes were estimated using the (i) terms of the Convertible Notes and Exchangeable Notes; (ii) rights, preferences, privileges, and restrictions of the underlying security; (iii) time until any restriction(s) are released; (iv) fundamental financial and other characteristics of the Company; (v) trading characteristics of the underlying security (exchange, volume, price, dividend yield and volatility); (vi) prevailing interest rates; and (vii) precedent sale transactions. The fair value was determined using a convertible note model that incorporated these inputs, as the convertible notes are not listed on any securities exchange or quoted on an inter-dealer automated quotation system. The Delayed Draw Term Loan and the 2018 Term Loan are classified within Level 3 of the fair value measurements hierarchy. The fair value of these instruments has been estimated using a discounted cash flow analysis based on incremental borrowing rate for similar borrowing arrangements. The carrying amount of the Nalpropion's 2018 Term Loan approximates fair value as the interest rate on the debt approximates the estimated borrowing rate currently available to Nalpropion. Given the nature and the variable interest rates under the ABL Facility (as defined below), the fair value of borrowings under this facility approximated their carrying value as of September 30, 2018. Derivative Liability The derivative liability is classified within Level 3 of the fair value measurements hierarchy and the fair value is determined using a "with and without" conversion scenario. Under this methodology, valuations are performed on the 4.25% Convertible Notes inclusive of all terms as well as for a convertible note that has identical terms and features but excluding the conversion option. The difference between the two valuations is equal to the fair value of the conversion option. Significant increases or decreases in these inputs would result in a significant change in the fair value of the derivative liability. Contingent Consideration The contingent consideration is classified within Level 3 of the fair value measurements hierarchy and the fair value is based on two components - a regulatory milestone and commercial milestone. For the regulatory milestone, the expected regulatory earn out payment was discounted taking into account (a) the Company's cost of debt, (b) the expected timing of the payment and (c) subordinate nature of the earn out obligation. The fair value of the commercial milestone was determined using a Monte Carlo simulation. This simulation assumed a risk-neutral framework, whereby future net revenue was simulated over the earn out period using the Geometric Brownian Motion. For each simulation path, the earn out payments were calculated based on the achievement of the revenue milestone and then were discounted to the valuation date. Significant increases or decreases in these unobservable inputs and/or the probability of achievement of these milestones would result in a significant change in the fair value of the contingent consideration. Treximet Secured Notes The Company's Treximet Secured Notes is classified within Level 3 of the fair value measurements hierarchy and the fair value was estimated using a discounted cash flow model. Fair Value Measurements Using Significant Unobservable Inputs (Level 3) For the Company's assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3), the following table provides a reconciliation of the beginning and ending balances for each category therein, and gains or losses recognized during the periods (in thousands). As of and for the As of and for the Nine Months Ended Nine Months Ended September 30, 2018 September 30, 2017 Derivative liability: Balance at beginning of year $ 93 $ 230 Impairment due to partial conversion - (90) Remeasurement adjustments - loss (gains) included in earnings (39) 38 Ending Balance $ 54 $ 178 Contingent consideration: Balance at beginning of year $ 1,358 $ 2,403 Remeasurement adjustments - loss (gains) included in earnings 143 344 Ending Balance $ 1,501 $ 2,747

7. Inventory

7. Inventory	9 Months Ended
	Sep. 30, 2018
Inventory Disclosure [Abstract]
7. Inventory	Note 7. Inventory Inventories are stated at the lower of cost or market. Inventories consist of the following (in thousands): September 30, December 31, 2018 2017 Raw materials $ 4,297 $ 727 Work-in-process 2,957 238 Finished goods 11,524 5,889 Inventory, gross 18,778 6,854 Reserve for obsolescence (990) (1,458) Inventory, net $ 17,788 $ 5,396 As of September 30, 2018, $13.6 million of inventory related to the Company's consolidation of Nalpropion as a VIE is included in the Company's unaudited condensed consolidated balance sheets.

8. Goodwill and Intangible Asse

8. Goodwill and Intangible Assets	9 Months Ended
	Sep. 30, 2018
Goodwill and Intangible Assets Disclosure [Abstract]
8. Goodwill and Intangible Assets	Note 8. Goodwill and Intangible Assets Goodwill consists of the following (in thousands): Amount Balance at December 31, 2016 $ 30,600 Impairment (18,500) Balance at December 31, 2017 12,100 Additions 5,472 Impairment - Balance at September 30, 2018 $ 17,572 The Company performs an impairment test of goodwill annually in the fourth quarter of each fiscal year unless there are triggering events that would require such analysis during an interim period. There were no triggering events during the nine months ended September 30, 2018. For the year ended December 31, 2017, the carrying value of the reporting unit exceeded its fair value by $18.5 million and accordingly an impairment charge of $18.5 million was recorded in 2017. The decline in the estimated fair value of the reporting unit resulted from management's review of its then-current forecast. As a result of this review, management lowered its forecast for Zohydro ER. The lower projected operating results reflected changes in assumptions related to revenue, market trends, cost structure, and other expectations about the anticipated short-term and long-term operating results of the business. As of September 30, 2018, $5.5 million of goodwill related to the Company's consolidation of Nalpropion as a VIE is included in the Company's unaudited condensed consolidated balance sheets. Intangible assets consist of the following (dollars in thousands): As of September 30, 2018 Weighted Average Gross Carrying Accumulated Net Carrying Life Remaining Amount Impairment Amortization Amount Unamortized intangible assets: In-process research and development Indefinite $ 11,000 $ - $ - $ 11,000 Total unamortized intangible assets 11,000 - - 11,000 Amortized intangible assets: Product licenses 4.8 years 2,846 - (1,823) 1,023 Supplier contracts 2.6 years 583 - (282) 301 Customer Lists 4.8 years 900 - (32) 868 Tradename 11.8 years 4,800 - (71) 4,729 Acquired developed technologies 12.7 years 409,486 - (293,758) 115,728 Total amortized intangible assets 418,615 - (295,966) 122,649 Total intangible assets $ 429,615 $ - $ (295,966) $ 133,649 As of December 31, 2017 Weighted Average Gross Carrying Accumulated Net Carrying Life Remaining Amount Impairment Amortization Amount Unamortized intangible assets: In-process research and development Indefinite $ 11,000 $ - $ - $ 11,000 Total unamortized intangible assets 11,000 - - 11,000 Amortized intangible assets: Product licenses 5.4 years 2,846 - (1,623) 1,223 Supplier contracts 3.3 years 583 - (194) 389 Acquired developed technologies 13.7 years 364,686 - (280,692) 83,994 Total amortized intangible assets 368,115 - (282,509) 85,606 Total intangible assets $ 379,115 $ - $ (282,509) $ 96,606 As of September 30, 2018, the weighted average remaining life for our definite-lived intangible assets in total was approximately 12.5 years. In process research and development (IPR&D) will be amortized on a straight-line basis over its useful life once the receipt of regulatory approval is obtained. Estimated amortization expense related to intangible assets with definite lives for each of the five succeeding years and thereafter is as follows (in thousands): Amount 2018 (October - December) $ 2,642 2019 10,567 2020 10,480 2021 10,385 2022 10,346 Thereafter 78,229 Total $ 122,649 Amortization expense was $2.3 million and $13.5 million for the three months and nine months ended September 30, 2018, respectively, of which, $29,000 and $88,000 are included in cost of product sales in the unaudited condensed consolidated statements of operations for the three and nine months ended September 30, 2018, respectively. Amortization expense was $18.2 million and $54.8 million for the three and nine months ended September 30, 2017, respectively, of which, $30,000 and $88,000 are included in cost of product sales in the unaudited condensed consolidated statements of operations for the three and nine months ended September 30, 2017, respectively As of September 30, 2018, $49.6 million of intangible assets related to the Company's consolidation of Nalpropion as a VIE is included in the Company's unaudited condensed consolidated balance sheets.

9. Accrued Allowances

9. Accrued Allowances	9 Months Ended
	Sep. 30, 2018
Accrued Liabilities [Abstract]
9. Accrued Allowances	Note 9. Accrued Allowances Accrued allowances consist of the following (in thousands): September 30, December 31, 2018 2017 Accrued returns allowance $ 25,370 $ 21,681 Accrued price adjustments 22,823 10,766 Accrued managed care rebates 17,230 17,221 Accrued government program rebates 6,275 6,641 Total $ 71,698 $ 56,309 As of September 30, 2018, $17.2 million of accrued allowances related to the Company's consolidation of Nalpropion as a VIE is included in the Company's unaudited condensed consolidated balance sheets.

10. Debt and Lines of Credit

10. Debt and Lines of Credit	9 Months Ended
	Sep. 30, 2018
Debt Disclosure [Abstract]
10. Debt and Lines of Credit	Note 10. Debt and Lines of Credit Debt, net of discounts and deferred financing costs, consists of the following (in thousands): As of September 30, 2018 As of December 31, 2017 Principal Note Discount Deferred Financing Costs Net of Discount and Deferred Financing Costs Principal Note Discount Deferred Financing Costs Net of Discount and Deferred Financing Costs 4.25% Convertible Notes $ 78,225 $ (8,828) $ (1,574) $ 67,823 $ 78,225 $ (11,060) $ (1,971) $ 65,194 Exchangeable Notes 36,145 (22,913) (3,202) 10,030 35,743 (24,363) (3,405) 7,975 Delayed Draw Term Loan 40,074 - (2,269) 37,805 30,000 - (2,752) 27,248 Treximet Secured Notes - Long Term 154,515 - (3,151) 151,364 166,697 - (2,810) 163,887 Treximet Secured Notes - Short Term - - - - 5,373 - (1,709) 3,664 2018 Term Loan 41,250 - - 41,250 - - - - ABL Facility 14,185 - - 14,185 14,185 - - 14,185 Total outstanding debt $ 364,394 $ (31,741) $ (10,196) $ 322,457 $ 330,223 $ (35,423) $ (12,647) $ 282,153 Less: Current portion of long-term debt - 3,664 Long-term debt outstanding, net $ 322,457 $ 278,489 Convertible Notes: 4.25% Convertible Notes On April 22, 2015, the Company issued $130.0 million aggregate principal amount 4.25% Convertible Notes. The 4.25% Convertible Notes mature on April 1, 2021, unless earlier converted, redeemed or repurchased. Interest on the 4.25% Convertible Notes is payable on April 1 and October 1 of each year, beginning October 1, 2015. The 4.25% Convertible Notes are governed by the terms of an indenture, between the Company and Wilmington Trust, National Association, each of which were entered into on April 22, 2015. The Company may not redeem the 4.25% Convertible Notes prior to April 6, 2019. However, the holders may convert their 4.25% Convertible Notes at any time prior to the close of business on the business day immediately preceding January 1, 2021 only under certain circumstances. The effective interest rate on the 4.25% Convertible Notes, including debt issuance costs and bifurcated conversion option derivative (discussed below), is 10.4%. The Company is required to separate the conversion option in the 4.25% Convertible Notes under Accounting Standards Codification (ASC) 815, Derivatives and Hedging Interest expense was $1.7 million and $5.1 million for the three and nine months ended September 30, 2018, respectively, and $1.9 million and $6.9 million for the three and nine months ended September 30, 2017, respectively, related to the 4.25% Convertible Notes. Interest expense includes amortization of deferred financing costs and accretion of debt discount. Change in fair value of derivative liability was a benefit of $18,000 and $39,000 for the three and nine months ended September 30, 2018, respectively, and a benefit of $46,000 and an expense of $38,000 for the three and nine months ended September 30, 2017, respectively. Accrued interest on the 4.25% Convertible Notes was approximately $1.7 million and $0.8 million as of September 30, 2018 and December 31, 2017, respectively. As a result of the Exchangeable Notes transaction during the third quarter of 2017, the Company recorded $14.7 million as gain from exchange of debt for the three months ended September 30, 2017. Exchangeable Notes On July 20, 2017, the Company entered into an exchange agreement (the 2017 Exchange Agreement) with certain holders of its 4.25% Convertible Notes (Holders) pursuant to which $51.8 million of aggregate principal amount of its 4.25% Convertible Notes held by the Holders were exchanged for (i) $36.2 million aggregate principal amount of 4.25%/5.25% Exchangeable Senior Notes due 2022 (the Exchangeable Notes), issued by PIP DAC pursuant to an Indenture, dated July 21, 2017 (the Exchangeable Notes Indenture), among PIPL, the guarantors party thereto (the Guarantors), and Wilmington Trust, National Association, as Trustee and (ii) 1,100,498 shares of Common Stock. The Exchangeable Notes issued under the Exchangeable Notes Indenture are guaranteed by the Company and each other subsidiary thereof. The Exchangeable Notes are senior, unsecured obligations of PIP DAC. Interest on the Exchangeable Notes will be paid in cash or a combination of cash and in-kind interest at PIP DAC's election. Interest paid in cash (the All Cash Method) will accrue at a rate of 4.25% per annum, while interest paid in a combination of cash and in-kind will accrue at a rate of 5.25% per annum, with 2.25% per annum (plus additional interest, if any) capitalized to the principal amount of the Exchangeable Notes, and the balance paid in cash. The maturity date of the Exchangeable Notes Indenture is July 15, 2022. The Exchangeable Notes initially are exchangeable into shares of Common Stock at an exchange price per share of $5.50 (the Exchange Price). The 2017 Exchange Agreement allowed the Company to reduce the principal amount of its outstanding indebtedness through the exchange of the Holders' 4.25% Convertible Notes for a smaller principal amount of the Exchangeable Notes. The principal amount of the Exchangeable Notes may be reduced if the Holders thereof exchange their Exchangeable Notes for shares of Common Stock. The Exchangeable Notes Indenture will provide capacity to refinance up to an additional $25.0 million principal amount of the 4.25% Convertible Notes, which refinancing could also provide an opportunity to further reduce the principal amount of the Company's outstanding indebtedness. The outstanding borrowings of the Exchangeable Notes were paid down by $500,000 in November 2017 with a portion of the proceeds from the sale of certain non-core assets. Interest expense was $1.0 million and $3.0 million for the three and nine months ended September 30, 2018, respectively, and $0.6 million for the three and nine months ended September 30, 2017, related to the Exchangeable Notes and included amortization of deferred financing costs and accretion of debt discount. During the first quarter of 2018, PIP DAC elected the PIK option in lieu of making scheduled interest payments. The election increased the principal due on the Exchangeable Notes by $402,000 as of September 30, 2018. Accrued interest on the Exchangeable Notes was approximately $396,000 and $675,000 as of September 30, 2018 and December 31, 2017, respectively. Term Facility: On July 21, 2017 PIP DAC entered into a term loan credit agreement (the Delayed Draw Term Loan, the Term Facility or DDTL) with Cantor Fitzgerald Securities, as agent and the lenders party thereto to obtain the DDTL. $30.0 million under the DDTL was drawn on July 21, 2017 in connection with the closing of several refinancing transactions and the remaining $15.0 million will be available for subsequent draws for certain specified purposes, including to finance certain acquisitions, subject to conditions set forth in the DDTL credit agreement. The DDTL includes an incremental feature that allows PIP DAC, with the consent of the requisite lenders under the Term Facility, to obtain up to an additional $20.0 million in term loan commitments. Interest on the loans will accrue either in cash or a combination of cash and in kind interest, at PIP DAC's election. Cash interest will accrue at a rate of 7.50% per annum, while the combination of cash and in-kind interest will accrue at a rate of 8.50% per annum, with up to 4.00% per annum added to the principal amount of loans and the balance paid in cash. The DDTL will mature on July 21, 2022. During the first quarter of 2018, PIP DAC elected the PIK option in lieu of making scheduled interest payments. The election increased the principal due on the DDTL by $906,000 as of September 30, 2018. On July 27, 2018, PIP DAC drew $9.2 million under the DDTL. The proceeds were used to fund the Company's investment in Nalpropion for Nalpropion's purchase of certain assets of Orexigen and for working capital requirements. PIP DAC also entered into a mortgage debenture with Cantor Fitzgerald Securities as agent, pursuant to which PIP DAC's obligations under the DDTL will be secured by substantially all of the assets of PIP DAC and its future-acquired subsidiaries. On August 1, 2018 the Company entered into an amendment of its Term Facility. These amendments were made to permit the exchange of the 12% Senior Secured Notes due 2020 (Treximet Secured Notes) for newly issued shares of Common Stock in the exchange transactions and equitization transaction (as defined below), and to amend certain terms of the Term Facility and the ABL Facility (collectively, the Credit Facilities), including (i) changes to permit the use of subsequent draws under the Term Facility for working capital or other general corporate purposes, and (ii) changes to the interest payment provisions under the Term Facility increasing the minimum percentage of interest that must be paid in cash to 6.00% per annum from 4.50% per annum. Interest expense was approximately $1.0 million and $2.6 million for the three and nine months ended September 30, 2018 related to the DDTL and includes amortization of deferred financing costs. Accrued interest on the DDTL was approximately $624,000 and $484,000 as of September 30, 2018 and December 31, 2017, respectively. Secured Notes: Treximet Note Offering On August 19, 2014, the Company issued $220.0 million aggregate principal amount of its Treximet Secured Notes pursuant to an Indenture (the August 2014 Indenture) dated as of August 19, 2014 among the Company, certain of its subsidiaries (the Treximet Guarantors) and U.S. Bank National Association (the August 2014 Trustee), as trustee and collateral agent. On April 13, 2015, the Company amended the August 2014 Indenture to allow the Company to, among other things, incur up to $42.2 million of additional debt. On December 29, 2017, the Company and the August 2014 Trustee entered into a third supplemental indenture to amend the August 2014 Indenture to clarify the definition of "Net Sales", as such term is defined in the August 2014 Indenture and resulted in the deferral of $3.2 million of principal payments until maturity of the notes. The Treximet Secured Notes mature on August 1, 2020 and bear interest at a rate of 12% per annum, payable in arrears on February 1 and August 1 of each year (each, a Payment Date), beginning on February 1, 2015. On each Payment Date, commencing August 1, 2015, the Company began paying installments of principal of the Treximet Secured Notes in an amount equal to 50% of net sales of Treximet for the two consecutive fiscal quarters immediately preceding such Payment Date (less the amount of interest paid on the Treximet Secured Notes on such Payment Date). At each month-end beginning with January 2015, the net sales of Treximet will be calculated, the monthly interest accrual amount will then be deducted from the net sales and this resulting amount will be recorded as the current portion of the Treximet Secured Notes. If the Treximet net sales less the interest due at the end of each six-month period does not result in any excess over the interest due, no principal payment must be paid at that time. The remaining balance outstanding on the Treximet Secured Notes will be due on the maturity date, which is August 1, 2020. As of September 30, 2018, the principal amount outstanding of the Treximet Secured Notes is $154.5 million and is classified as a non-current liability. As of December 31, 2017, the Company classified $5.4 million, of the Treximet Secured Notes as a current liability and $166.7 million as a non-current liability at December 31, 2017. The Treximet Secured Notes are secured by a continuing first-priority security interest in substantially all of the assets of the Company and the Treximet Guarantors related to Treximet other than inventory and certain inventory related assets, including accounts arising from the sale of the inventory. On August 1, 2018, the Company entered into an exchange agreement (2018 Exchange Agreement) with certain holders (Exchange Holders) of the Treximet Secured Notes for newly issued shares of Common Stock and shares of a newly created class of convertible preferred stock of the Company designated as Convertible Preferred Stock (Exchange Transactions). The Exchange Transactions closed on August 1, 2018 and were as follows: exchange of approximately $2.7 million aggregate principal amount of the Treximet Secured Notes for 1,204,586 shares of Common Stock which includes $0.2 million of accrued and unpaid interest on the Treximet Secured Notes; exchange of $8.0 million principal amount of the Treximet Secured Notes plus $0.1 million of accrued and unpaid interest for 81,000 shares of Convertible Preferred Stock. The 2018 Exchange Agreement affords certain Exchange Holders the right to exchange up to an additional $65.1 million aggregate principal amount of the Treximet Secured Notes plus accrued and unpaid interest, into additional Convertible Preferred Stock until February 1, 2020. The Company evaluated the transaction under ASC 470-50, Debtors Accounting for a Modification or Exchange of Debt Instruments On August 1, 2018, the Company entered into separate Equitization Exchange Agreements by and among Pernix and certain Equitization Holders of Treximet Secured Notes. Pursuant to the Equitization Exchange Agreements, the Company issued 650,190 shares of its Common Stock in exchange for approximately $1.5 million aggregate principal amount of Treximet Secured Notes held by such Equitization Holders plus $0.1 million of accrued and unpaid interest thereon (Equitization Transaction). This transaction closed on August 1, 2018. As a result of the Exchange Transactions and Equitization Transaction, the Company recorded a net gain on early extinguishment of debt of $0.1 million. Interest expense related to the Treximet Secured Notes was $5.2 million and $16.1 million for the three and nine months ended September 30, 2018, respectively, and was $5.6 million and $17.2 million for the three and nine months ended September 30, 2017, respectively. Interest expense includes amortization of deferred financing costs. Accrued interest on the Treximet Secured Notes was approximately $3.1 million and $8.6 million as of September 30, 2018 and December 31, 2017, respectively. 2018 Term Loan On July 27, 2018, Nalpropion entered into a credit agreement (2018 Credit Agreement) with Wilmington Savings Fund Society, FSB, as administrative and collateral agent, and certain lenders including PIP DAC and certain affiliates of Highbridge Capital Management, LLC (Highbridge) and Whitebox Advisors LLC (Whitebox, and collectively, the Lenders) from time to time party thereto providing for $45.8 million principal amount of a three-year term loan (the 2018 Term Loan). Loans under the 2018 Term Loan bear interest at 8.0% per year and mature on July 27, 2021. PIP DAC provided $4.6 million of the total commitment under the credit facility established under the 2018 Credit Agreement (2018 Credit Facility). Nalpropion borrowed the full $45.8 million available under the 2018 Term Loan to partially fund the Orexigen Acquisition and for working capital requirements. As PIP DAC is one of the lenders under the 2018 Credit Facility and provided $4.6 million of the total commitment under the 2018 Credit Facility, the $4.6 million is eliminated in consolidation as the transaction is between affiliates. As of September 30, 2018, $41.3 million of borrowings under the 2018 Term Loan related to the Company's consolidation of Nalpropion as a VIE is included in the Company's unaudited condensed consolidated balance sheets. The borrowings under the 2018 Credit Agreement are secured, subject to customary permitted liens and other agreed upon exceptions, by a perfected security interest in the intangible assets of Nalpropion. Nalpropion is permitted to make voluntary prepayments at any time without payment of a premium or penalty. Nalpropion is required to make mandatory prepayments of outstanding indebtedness under the 2018 Credit Agreement (without payment of a premium) with (a) net cash proceeds from certain non-ordinary course asset sales (subject to reinvestment rights and other exceptions), (b) casualty proceeds and condemnation awards (subject to reinvestment rights and other exceptions), and (c) 75% of the excess cash flow generated during a semi-annual period (commencing with the period subsequent to June 30, 2019), depending on certain factors as defined in the 2018 Credit Agreement. The 2018 Credit Agreement contains certain negative covenants (subject to exceptions, materiality thresholds and other allowances) including, without limitation, negative covenants that limit Nalpropion's ability to incur additional debt, guarantee other obligations, grant liens on assets, make loans, acquisitions or other investments, dispose of certain assets, make optional payments in connection with or modify certain debt instruments, pay dividends or make other payments on capital stock, engage in mergers or consolidations, enter into arrangements that restrict Nalpropion's ability to pay dividends or grant liens, engage in transactions with affiliates, or change its fiscal year. In addition, the 2018 Credit Agreement also contains customary events of default (with customary grace periods and materiality thresholds). Upon the occurrence of certain events of default, the obligations under the 2018 Credit Agreement may be accelerated and any remaining commitments thereunder may be terminated. Interest expense related to the 2018 Term Loan was $0.7 million for the three months ended September 30, 2018 of which $0.1 million is due to the Company and is eliminated in consolidation. As of September 30, 2018, $0.6 million of accrued interest on the 2018 Term Loan related to the Company's consolidation of Nalpropion as a VIE is included in the Company's unaudited condensed consolidated balance sheets. Credit Facility : Cantor Fitzgerald On July 21, 2017, Pernix and certain subsidiaries of Pernix as borrowers and guarantors (the ABL Borrowers) and PIP DAC, Pernix Ireland Limited, Pernix Holdco 1, LLC, Pernix Holdco 2, LLC and Pernix Holdco 3, LLC as additional guarantors (the ABL Guarantors), entered into an asset-based revolving credit agreement (the ABL Credit Agreement) with Cantor Fitzgerald Securities, as agent (the ABL Agent) and the lenders party thereto to obtain a five-year $40 million asset-based revolving credit facility (the ABL Facility). On April 23, 2018, the Company entered into an amendment, effective as of April 12, 2018, to modify the borrowing base formula which determines the Company's capacity to draw on the ABL Facility, which could increase such capacity. The amendment also removed concentration limits for accounts receivable due from individual customers or other account debtors that may be included in the borrowing base. The ABL Borrowers' obligations under the ABL Credit Agreement are guaranteed by the ABL Borrowers and the ABL Guarantors are secured by, among other things, the ABL Borrowers' cash, inventory and accounts receivable, in each case pursuant to a guaranty and security agreement between the ABL Borrowers, ABL Guarantors and Cantor Fitzgerald Securities as agent. Borrowings under the ABL Credit Agreement bear interest at the rate of LIBOR plus 7.50%, payable monthly, in addition to a commitment fee on any undrawn commitments at a rate per annum of 0.25%, payable monthly. The ABL Credit Agreement contains representations and warranties, affirmative and negative covenants, and events of default applicable to the Company, the other ABL Borrowers, the ABL Guarantors and their respective subsidiaries that are customary for credit facilities of this type. The ABL Credit Agreement will mature on July 21, 2022. On August 1, 2018 the Company entered into an amendment of the ABL Facility. The amendment provides for certain changes to the borrowing base calculation under the ABL Facility that are intended to improve the Company's borrowing capacity under the ABL Facility and that will also permit the Company, among other things, to include Contrave inventory owned by the Company in the calculation of the borrowing base, and a reduction in the commitments under the ABL Facility from $40.0 million to $32.5 million. Interest expense was $0.5 million and $1.5 million for the three and nine months ended September 30, 2018, respectively, and was $0.4 million for the three and nine months ended September 30, 2017, related to the ABL Credit Agreement and includes amortization of deferred financing costs. As of September 30, 2018, unamortized debt issuance costs of $0.6 million and $1.6 million are recorded on the unaudited consolidated balance sheets in Prepaid expenses and other currents assets and Other assets, respectively, and are being amortized to interest expense over the life of the agreement. As of December 31, 2017, $0.6 million and $2.1 million of unamortized debt issuance costs are recorded on the unaudited consolidated balance sheets in Prepaid expenses and other currents assets and Other assets, respectively. Wells Fargo On August 21, 2015, the Company entered into a credit agreement with Wells Fargo, as Administrative Agent and the lenders party thereto for a $50.0 million, three-year senior secured revolving credit facility (the Wells Fargo Credit Facility). The ABL Facility entered into on July 21, 2017 replaced the Wells Fargo Credit Facility and the Company used the proceeds from the ABL Facility to repay the outstanding obligation of the Wells Fargo Credit Facility. Interest expense including amortization of deferred financing costs related to the Wells Fargo Credit Facility amounted to $142,000 and $748,000, for the three and nine months ending September 30, 2017, respectively. The following table represents the future maturity schedule of the outstanding debt and line of credit at September 30, 2018 (in thousands): Amount 2018 (October - December) $ - 2019 - 2020 154,515 2021 119,475 2022 90,404 Thereafter - Total maturities 364,394 Less: Note discount (31,741) Deferred financing costs (10,196) Total outstanding debt, net $ 322,457

11. Stockholders' Equity

11. Stockholders' Equity	9 Months Ended
	Sep. 30, 2018
Stockholders Equity
11. Stockholders' Equity	Note 11. Stockholders' Equity Convertible Preferred Stock On August 1, 2018, in connection with the 2018 Exchange Agreement, the Company reclassified and designated 1,500,000 shares of the authorized but unissued preferred stock of the Company to the Convertible Preferred Stock. In connection with the Exchange Transactions, $8.0 million principal amount of the Treximet Secured Notes plus $100,000 of accrued and unpaid interest was exchanged for 81,000 shares of Convertible Preferred Stock. The Convertible Preferred Stock was recorded at fair value in the amount of $7.2 million, net of issuance costs of $0.5 million and is recorded to additional paid-in capital. Holders of Convertible Preferred Stock have the right to convert their shares of Convertible Preferred Stock, in whole or in part, into shares of Common Stock at any time on or after August 1, 2018 (the Initial Issue Date). The Company has the right, at its option, to automatically convert all shares of Convertible Preferred Stock into shares of Common Stock, subject to the satisfaction of certain specified conditions. Upon any conversion of an Exchange Holder's Convertible Preferred Stock, the Company will deliver shares of Common Stock, calculated by multiplying the number of shares of Convertible Preferred Stock by 41.841 shares of Common Stock per share of Convertible Preferred Stock (the Conversion Rate). The Conversion Rate is initially equal to the number of shares of Common Stock convertible into Common Stock at a price $0.01 above the consolidated closing bid price on the date immediately preceding Initial Issue Date, or $2.39 per share. Subsequent to the Initial Issue Date, an Exchange Holder is not able to convert Convertible Preferred Stock into Common Stock to the extent that the Common Stock held by such Exchange Holder and its affiliates would exceed 4.985% of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock. Moreover, at any time on or after the Initial Issue Date, the Company has the right to redeem the Convertible Preferred Stock, in whole or in part, at a redemption price equal to 100% of the liquidation preference of the shares to be redeemed, plus any accrued and unpaid dividends. Except as required by law or the Articles Supplementary, the Exchange Holders of Convertible Preferred Stock have no voting rights (other than with respect to certain matters regarding the Convertible Preferred Stock). In accordance with the Articles Supplementary, the Company will not authorize, declare or pay regular or special dividends or other distributions (whether in the form of cash, shares, indebtedness or any other property or asset, but excluding any purchase, redemption or other acquisition of shares) on the shares of the Common Stock, unless simultaneously with the authorization, declaration or payment, it authorizes, declares or pays, as applicable, dividends or other distributions on the Convertible Preferred Stock. On October 3, 2018, holders of 13,100 shares of the Company' 0% Series C Perpetual Convertible Preferred Stock elected to convert such Convertible Preferred Stock into 548,115 shares of the Company's Common Stock. Controlled Equity Offering On November 7, 2014, the Company entered into a controlled equity offering sales agreement (the Sales Agreement) with Cantor Fitzgerald & Co. (Cantor) pursuant to which the Company could issue and sell shares of its Common Stock having an aggregate offering price of up to one hundred million dollars, pursuant to an effective registration statement on Form S-3 (No. 333-200005), from time to time through Cantor, acting as agent. On November 22, 2017, the Company filed a registration statement on Form S-3 (No. 333-221717) to replace the previously-filed registration statement, which was subsequently declared effective by the SEC on December 18, 2017. The Company will pay Cantor a commission rate of 3.0% of the gross sales price per share of the Common Stock sold through Cantor as agent under the Sales Agreement. During the nine months ended September 30, 2018, the Company sold 191,170 shares of Common Stock under the Sales Agreement at an average price of approximately $2.51 per share for gross proceeds of $480,000 and net proceeds of $453,000, after deducting commission and fees. During the nine months ended September 30, 2017, the Company sold 372,176 shares of Common Stock under the Sales Agreement at an average price of approximately $3.21 per share for gross proceeds of $1.2 million and net proceeds of $1.1 million, after deducting commission and fees. As of September 30, 2018, approximately $77.0 million of Common Stock remained available to be sold under this facility, subject to certain limitation to the extent the Company continues to have a public float of less than $75.0 million. Noncontrolling Interest Ownership interests in subsidiaries held by parties other than the Company are presented as non-controlling interest within stockholders' equity, separately from the equity held by the Company on the consolidated statements of stockholders' equity. Revenues, expenses, net income and other comprehensive income are reported in the condensed consolidated financial statements at the consolidated amounts, which includes amounts attributable to both the Company's interest and the non-controlling interests in Nalpropion. Net loss and other comprehensive loss is then attributed to the Company's interest and the non-controlling interests. Net loss to non-controlling interests is added to net loss in the consolidated statements of loss to determine net loss attributable to the Company's common shareholders (see unaudited condensed consolidated statements of stockholders' equity (deficit) for activity related to the noncontrolling interest). Warrants As of September 30, 2018, the Company has approximately 4,380 outstanding Common Stock warrants assumed in connection with the acquisition of Somaxon Pharmaceuticals, Inc. (Somaxon) in March 2013, with exercise prices ranging from $83.73 to $258.51 and expiration dates ranging from August 2021 through December 2021. Share-Based Compensation Plans In November 2017, the Company's shareholders approved the 2017 Omnibus Incentive Plan (the 2017 Plan) for future equity awards granted by the Company. Subject to the adjustments described below, the maximum number of shares of Common Stock that will be available for issuance under the 2017 Omnibus Incentive Plan will be equal to the sum of (i) one million (1,000,000) shares of Common Stock plus (ii) the number of shares of our Common Stock available for future awards under the 2015 Omnibus Incentive Plan and the 2009 Stock Incentive Plan as of November 15, 2017, plus (iii) the number of shares of Common Stock related to awards outstanding under such plans as of November 15, 2017 that terminate after such date by expiration or forfeiture, cancellation, or otherwise without the issuance of such shares of Common Stock. On May 22, 2018, the Company's stockholders approved an amendment to the 2017 Plan to increase the number of shares reserved under the 2017 Plan from 642,294 shares of Common Stock to 1,242,294 shares of Common Stock. Stock-Based Compensation Stock-based compensation expense is recognized, net of an estimated forfeiture rate, on a straight-line basis over the requisite service period, which is the vesting period. The Company uses the Black-Scholes option pricing model to determine the fair value of its stock options. The weighted average fair value of stock options granted during the periods and the assumptions used to estimate those values using the Black-Scholes option pricing mode were as follows: Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Weighted average expected stock price volatility 86.4% 88.0% 86.4% 87.6% Estimated dividend yield - - - - Risk-free interest rate 2.9% 2.0% 2.8% 2.0% Expected life of option (in years) 6.3 6.2 6.3 6.2 Weighted average grant date fair value per option $ 0.69 $ 2.15 $ 1.61 $ 2.15 The Company measures the grant date fair value of restricted stock units (RSUs) using the Company's closing Common Stock price on the grant date. The accounting policy with respect to stock options and RSUs is described in the audited consolidated financial statements contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2017 Stock-based compensation expense was $0.4 million and $1.3 million for the three and nine months ended September 30, 2018, respectively and was $0.5 million and $1.9 million for the three and nine months ended September 30, 2017. Stock-based compensation expense for the periods presented is included within the selling, general and administrative expense in the unaudited condensed consolidated statements of operations. Stock Options The following table shows the option activity, described above, during the nine months ended September 30, 2018 (shares and intrinsic value in thousands): Weighted Average Average Remaining Aggregate Exercise Contractual Life Intrinsic Shares Price (years) Value Options Outstanding at December 31, 2017 1,042 $ 13.80 8.8 Granted 556 2.17 Exercised - - Cancelled (228) 12.29 Expired - - Options outstanding at September 30, 2018 1,370 $ 9.34 8.7 $ 5 Options vested and expected to vest as of September 30, 2018 895 $ 12.86 8.3 $ 2 Options vested and exercisable as of September 30, 2018 339 $ 24.88 7.3 $ - As of September 30, 2018, there was approximately $1.4 million of total unrecognized compensation cost related to non-vested stock options issued to employees and directors of the Company, which is expected to be recognized ratably over a weighted-average period of 2.0 years. The total intrinsic value of options exercised during each of the three and nine months ended September 30, 2018 and 2017 was $0. Options issued subsequent to January 2014 have a graded vesting schedule over either three or four years. The Company's stock option grants expire ten years from the date of grant. Restricted Stock The following table shows the Company's non-vested restricted stock activity during the nine months ended September 30, 2018 (shares in thousands): Weighted Average Grant Date Fair Shares Value Non-vested restricted stock outstanding at December 31, 2017 135 $ 3.17 Granted 62 2.46 Vested (54) 3.25 Forfeited (2) 2.60 Non-vested restricted stock outstanding at September 30, 2018 141 $ 2.83 The total fair value of RSUs vested in the nine months ended 2018 and 2017, were $177,000 and $220,000, respectively. As of September 30, 2018, there was $0.8 million total unrecognized compensation cost related to non-vested restricted stock issued to employees and directors of the Company which is expected to be recognized ratably over a weighted-average period of 1.97 years.

12. Income Taxes

12. Income Taxes	9 Months Ended
	Sep. 30, 2018
Income Tax Disclosure [Abstract]
12. Income Taxes	Note 12. Income Taxes On December 22, 2017, the U.S. Tax Cuts and Jobs Act ("TCJA") was enacted reducing the corporate Federal tax rate from 35% to 21% effective for tax years beginning on or after January 1, 2018. ASC 740, Income Taxes, Under the TCJA, the Corporate Alternative Minimum Tax ("AMT") was repealed. The Company's previously recorded AMT credits of approximately $0.2 million are now refundable subject to budgetary sequestration over a four-year period beginning in 2018, and the previously recorded valuation allowance for these AMT credits was reversed during the year ended December 31, 2017. The Company's Irish subsidiaries have accumulated deficits in earnings and profits and thus the Company will not be subject to the one-time transition tax. The TCJA creates a new requirement that certain income (i.e., Global intangible low taxed income "GILTI") earned by foreign subsidiaries must be included currently in the gross income of the U.S. shareholder. Due to the complexity of the new GILTI tax rules, the Company is continuing to evaluate this provision of the Tax Act and the application of ASC 740. Under U.S. GAAP, the Company is permitted to make an accounting policy election to either treat taxes due on future inclusions in U.S. taxable income related to GILTI as a current-period expense when incurred or to factor such amounts into the Company's measurement of its deferred taxes. The Company has not yet completed its analysis of the GILTI tax rules and is not yet able to reasonably estimate the effect of this provision of the Tax Act or make an accounting policy election for the ASC 740 treatment of the GILTI tax. Therefore, the Company has not recorded any amounts related to potential GILTI tax in its consolidated financial statements and has not yet made a policy decision regarding whether to record deferred taxes on GILTI. The Company reported an income tax expense of approximately $61,000 and $109,000 for the three and nine months ended September 30, 2018, respectively and an income tax expense of approximately $27,000 and $122,000 for the three and nine months ended September 30, 2017, respectively. The Company's effective tax rate was (0.2%) for the nine months ended September 30, 2018, compared to an estimated annual effective rate of (0.3%) for the nine months ended September 30, 2017. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of the assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. All deferred tax assets were subject to a full valuation allowance as of December 31, 2017. The Company evaluates the realizability of its U.S. net deferred tax assets based on all available evidence, both positive and negative, on a quarterly basis. The realization of net deferred tax assets is dependent on the Company's ability to generate sufficient future taxable income during periods prior to the expiration of tax attributes to fully utilize these assets. The Company weighed both positive and negative evidence and determined that due to recent losses there is a continued need for a full valuation allowance against all of the Company's deferred tax assets as of September 30, 2018 and December 31, 2017. As of September 30, 2018, the Company's gross deferred tax assets are comprised primarily of U.S. Federal net operating losses and accruals, and its gross deferred tax liabilities are comprised primarily of differences in the financial statement and tax bases of intangible assets. The Company files income tax returns with both federal and state-level taxing authorities in the U.S., and with the taxing authorities of various foreign jurisdictions. The associated tax filings remain subject to examination by applicable tax authorities for a certain length of time following the tax year to which those filings relate. The IRS audit of the Company's 2014 and 2015 Federal tax returns concluded during the quarter ended September 30, 2018, and there were no material impacts to the Company's income tax provision as a result. The Company's 2016 and 2017 tax returns are subject to potential examination.

13. Commitments and Contingenci

13. Commitments and Contingencies	9 Months Ended
	Sep. 30, 2018
Commitments and Contingencies Disclosure [Abstract]
13. Commitments and Contingencies	Note 13. Commitments and Contingencies Legal Proceedings Pernix Ireland Pain Limited (n/k/a Pernix Ireland Pain Designated Activity Company) and Pernix Therapeutics, LLC v. Actavis Laboratories FL, Inc. (Actavis), Pernix Ireland Pain Limited and Pernix Therapeutics, LLC v. Alvogen Malta Operations, Ltd. (Alvogen), District of Delaware Case No. 16-139. PIP DAC is the owner of: (a) U.S. Patent No. 9,265,760 (the '760 Patent), issued on February 23, 2016, (b) U.S. Patent No. 9,326,982 (the '982 Patent), issued on May 3, 2016, (c) U.S. Patent No. 9,333,201 (the '201 Patent), issued on May 10, 2016, and (d) U.S. Patent No. 9,339,499 (the '499 Patent), issued on May 17, 2016 (collectively, the Pernix Zohydro ER Patents). The Pernix Zohydro ER Patents are listed in the United States Food and Drug Administration's (FDA) Orange Book: Approved Drug Products with Therapeutic Equivalence Evaluations (the Orange Book) as covering Zohydro ER. Pernix Therapeutics, LLC (Pernix LLC) is the sole distributor of Zohydro ER in the United States. Pernix LLC and PIP DAC (collectively for the purpose of this paragraph, Pernix) brought suit against Actavis and Alvogen in the District of Delaware on March 4, 2016, seeking declaratory judgment of infringement of the '760 Patent. The Complaints relating to the '760 Patent were served on March 7, 2016. Pernix filed and served First and Second Amended Complaints on May 13, 2016 and May 31, 2016 against Alvogen and Actavis, respectively, adding allegations of infringement with respect to the '982, '201, and '499 Patents. Actavis Motion to Dismiss was completed on July 11, 2016. United States Patent Nos. 9,421,200 (the '200 Patent) and 9,433,619 (the '619 Patent) issued on August 23, 2016 and September 5, 2016, respectively. Pernix filed and served Second and Third Amended Complaints, against Alvogen and Actavis respectively, on October 12, 2016, adding allegations of infringement with respect to the '200 and '619 Patents. Actavis and Alvogen filed their respective Answers on November 30, 2016, denying Pernix's infringement allegations and raising Counterclaims of non-infringement and invalidity as to each of the asserted patents. Pernix and Actavis entered into a settlement agreement on January 29, 2018. Under the terms of the agreement, Pernix will grant Actavis a license to begin selling a generic version of Zohydro ER on March 1, 2029, or earlier under certain circumstances. Other details of the settlement are confidential. The launch of Actavis's generic product is contingent upon Actavis receiving final approval from the FDA of its ANDA for a generic version of Zohydro ER. For the Alvogen case, trial testimony was heard from June 11-13, 2018, post-trial briefing was completed on July 12, 2018, and the trial concluded with the parties' closing arguments on July 25, 2018. The district court's trial decision was rendered on August 24, 2018, finding the asserted claims of the Zohydro ER Patents to be infringed by Alvogen's proposed generic Zohydro ER product and not to be invalid for anticipation under 35 U.S.C. § 102. The district court also found the asserted claims to be invalid for obviousness under 35 U.S.C. § 103 and as lacking adequate written description under 35 U.S.C. § 112. Pernix filed a Notice of Appeal on September 7, 2018, appealing the district court's decision that the asserted claims are invalid for obviousness and lacking adequate written description to the United States Court of Appeals for the Federal Circuit. Pernix's opening appellate brief is due no later than November 13, 2018, Alvogen's answering brief is due no later December 24, 2018 and Pernix's reply brief is due no later than January 7, 2019. Oral argument on the appeal is expected in the second quarter of 2019, with a written decision to follow thereafter. Medicine to Go Pharmacies, Inc. v. Macoven Pharmaceuticals, LLC and Pernix Therapeutics Holdings, Inc., District Court of New Jersey Case No. 2:16-cv-07717. On October 23, 2016, Medicine to Go Pharmacies, Inc. (Plaintiff) filed an action against Pernix and its subsidiary, Macoven and unidentified individuals seeking redress for sending allegedly unlawful advertisements to facsimile machines in violation of the Telephone Consumer Protection Act, 47 U.S.C. 227. On December 2, 2016, the Company filed its answers in defense of the allegations. The December 2013 fax campaign that is the subject of this litigation was administered by a third party, Odyssey Services, Inc. (Odyssey), which was not initially named as a defendant in this litigation. On June 22, 2017, the Company filed a third-party complaint against Odyssey, seeking indemnity and contribution for any amounts that the Company may be liable to pay to the Plaintiff. Odyssey answered the third-party complaint and, in addition, filed a counterclaim for indemnification against the Company, alleging that the Company, not Odyssey, was responsible for the content of the facsimiles transmitted, and thus is liable to Odyssey for any costs or judgments associated with this action. Odyssey also filed a motion for summary judgment, seeking to dismiss the third-party claims against it; the Company has moved for summary judgment to hold Odyssey liable to indemnify the Company. A settlement conference was conducted by the Court on July 12, 2018 during which counsel for Plaintiff and the Company agreed in principle that for purposes of settlement the defendants will create a settlement fund and the Company will contribute a total of $1.2 million to said fund, which amount shall be final and includes any and all costs of the settlement, including payment of claims submitted by class members, class notice, settlement administration, Plaintiff's attorneys' fees and costs, and any incentive award to Plaintiff. Further, the Company will not oppose Plaintiff's request that a Rule 23(b)(3) settlement class consisting of all persons and entities with fax numbers who received a copy of the December 2013 "Dear Pharmacist" fax be certified by the Court and the Company will agree that any unclaimed amounts of the settlement fund shall be distributed to one or more cy pres Opioids Litigation Beginning in 2014 and continuing to the present, a number of pharmaceutical companies have been named in numerous lawsuits brought by certain state and local governments related to the marketing of opioid pain medications. The claims are generally based on alleged misrepresentations and/or omissions in connection with the sale and marketing of prescription opioid pain medications and/or an alleged failure to take adequate steps to prevent abuse and diversion. The suits generally seek penalties and/or injunctive and monetary relief. These cases are in early stages of litigation. In May 2018, the Company was notified that the State of Arkansas has named approximately 65 companies and individuals, including the Company, in an ongoing lawsuit relative to the marketing and sale of opioid pain medications. In September of 2018, the Company filed a motion to dismiss the Arkansas lawsuit. That motion is currently pending. During the second quarter of 2018, the Company was also served with two additional lawsuits in which it was included as a defendant, both of which were filed in Philadelphia County, PA ( UFCW Local 23 Health Fund v. Endo Pharmaceuticals, Inc., et al. Iron Workers Dist. Council of Philadelphia & Vicinity, Benefit Fund v. Abbott Laboratories, Inc., et al. The Company intends to vigorously defend against the claims asserted against it in these litigations but is unable to predict probable outcomes at this time. Navigators Insurance Company v. Pernix Therapeutics Holdings, Inc. (U.S. District Court, Eastern District of PA) On October 26, 2018, Navigators Insurance Company ("Navigators") initiated an insurance coverage declaratory judgment action against Pernix in the United States District Court for the Eastern District of Pennsylvania. The action pertains to a dispute between the parties as to whether Navigators owes coverage under certain insurance policies for the defense and potential indemnity of Pernix in three lawsuits pending against Pernix: (1) UFCW, Local 23 and Employers Health Fund v. Endo Pharmaceuticals, Inc. et al. Iron Workers District Council of Philadelphia and Vicinity, Benefit Fund v. Abbott Laboratories, Inc. et al. State of Arkansas, ex. rel. Scott Ellington et al. v. Purdue Pharma, L.P. et al. The complaint alleges that Pernix requested that Navigators defend and indemnify it in the Underlying Actions under three policies Navigators issued to Pernix, all of which are effective from November 30, 2017 to November 30, 2018: a Products-Completed Operations Liability policy (the "Products Liability Policy"), a Commercial General Liability policy (the "CGL Policy"), and (3) a Commercial Umbrella Liability policy (the "Umbrella Policy") (collectively, the "Policies"). The complaint further alleges that, by letter dated October 23, 2018, Navigators: (1) disclaimed any duty to defend or indemnify Pernix in the UFCW Action and Iron Workers Action under the Policies; (2) disclaimed any duty to defend or indemnify Pernix in the Arkansas Lawsuit under the CGL and Umbrella Policies; (3) disclaimed any duty to defend or indemnify Pernix on Counts Three to Nine of the Arkansas Action under the Products Liability Policy; and (4) reserved the right to disclaim any duty to defend or indemnify Pernix on Counts One and Two of the Arkansas Action under the Products Liability Policy. Navigators alleges that Pernix disputes the propriety of Navigator's disclaimers. Navigators has asserted seven counts against Pernix. Counts I through VI seek declarations that Navigators has no duty to defend or indemnify Pernix in the Underlying Actions under any of the Policies. These counts contain allegations of the various provisions of the Policies on which Navigators relies. Count VII is pled in the alternative and seeks a declaration that Navigators is entitled to allocation between covered and uncovered defense and indemnification costs to the extent that any counts of the Underlying Actions are covered by one or more of the Policies. Pernix intends to vigorously contest these claims, and file a counterclaim that Navigators owes Pernix a duty to defend all of the Underlying Actions in full, and that any determination of the duty to indemnify at this point is premature. Other Commitments and Contingencies In July 2012 and January 2013, Somaxon settled two patent litigation claims with parties seeking to market generic equivalents of Silenor. As of September 30, 2018, remaining payment obligations of the Company owed under these settlement agreements are $250,000. The balance is payable in the third quarter 2019 and is recorded in "other liabilities - current" on the Company's unaudited condensed consolidated balance sheets as of September 30, 2018. During the first quarter of 2014, the Company settled all claims arising from certain actions by Cypress under the Texas Medicaid Fraud Prevention Act prior to its acquisition by the Company. As part of the settlement, the Company agreed to pay $12.0 million, payable in annual amounts of $2.0 million until the settlement is paid in full. As of September 30, 2018, the net present value of remaining payment obligations owed under this settlement agreement is $2.0 million and is recorded within other liabilities - current on the Company's unaudited condensed consolidated balance sheets as of September 30, 2018. GlaxoSmithKline (GSK) Arbitration Pursuant to Amendment No. 2, the Company agreed that if on or before September 30, 2019, the Company (x) redeems or repurchases its 4.25% Convertible Notes for greater than 31 cents for every one dollar of principal amount outstanding or (y) exchange such notes for new notes or similar instruments that have a face value providing such exchanging holders a recovery that is greater than 31 cents for every one dollar of 4.25% Convertible Notes exchanged by such holders, the Company shall, no later than five business days thereafter, distribute to GSK additional cash or notes, as applicable, equal to such excess recovery, but in no event to exceed $2.0 million. GSK has agreed that for so long as the Company complies with the payment terms set forth in the Amendment No. 2, enforcement of the award will be stayed and GSK shall not seek to enforce or exercise any other remedies in respect of the award, and that the outstanding balance of the Award shall be unconditionally and irrevocably forgiven upon satisfaction of such terms. As of September 30, 2018 and December 31, 2017, the Company has recorded $2.0 million as contingent consideration for the potential payment due by September 30, 2019 and is recorded in "other liabilities - current" and "Arbitration Award" on the Company's consolidated balance sheets, respectively. Also, the Company recorded $10.5 million as a gain from legal settlement for the year ended December 31, 2017 pursuant to Amendment No. 2 in the consolidated statements of operations and comprehensive loss. Nalpropion Related Litigation In April 2015, Orexigen and Takeda Pharmaceutical Company Limited (Takeda) received notification of a Paragraph IV certification for certain patents for Contrave which are listed in the Orange Book. The certification resulted from the filing by Actavis Laboratories FL, Inc. (Actavis) of an ANDA challenging such patents for Contrave. In June 2015, Orexigen and Takeda filed a lawsuit in the U.S. District Court for the District of Delaware against Actavis on the basis that Actavis' proposed generic products infringe certain patents for Contrave. Takeda held the NDA for Contrave and was a licensee of Orexigen's patents until August 2016, at which point the ownership of the NDA was transferred to Orexigen and Takeda's rights to the Orexigen patents were terminated. A bench trial took place in June 2017 and on October 13, 2017, the court issued an opinion finding that the claims of the three patents at issue (U.S. Patent Nos. 7,462,626, 7,375,111 and 8,916,195, which expire in 2024, 2025 and 2030, respectively) were valid and infringed. Actavis filed an appeal, which is pending in the U.S. Court of Appeals for the Federal Circuit (Federal Circuit Appeal), and filed its opening appeal brief on February 21, 2018. The Federal Circuit ordered that the appeal be stayed during Orexigen's pending bankruptcy proceedings. On July 27, 2018, Nalpropion acquired worldwide rights to Contrave, including the rights to the patents at issue. Nalpropion filed motions to substitute itself as a party in the appeal and to lift the stay. Those motions were granted on September 19, 2018, allowing the appeal to proceed. Nalpropion's answering was filed on September 28, 2018, and Acatvis's reply appeal brief is due on November 13, 2018. Oral argument is expected sometime in the first half of 2019. If Actavis is successful in the Federal Circuit Appeal, a generic version of Contrave could be launched prior to the expiration of one or more of the patents at issue, which would materially impact Nalpropion's and our financial condition and results of operations. Further, if Contrave infringes or is alleged to infringe intellectual property rights of third parties, we may be adversely affected.

14. Restructuring

14. Restructuring	9 Months Ended
	Sep. 30, 2018
Restructuring and Related Activities [Abstract]
14. Restructuring	Note 14. Restructuring On January 4, 2018, the Company committed to and commenced a realignment plan to reduce operating costs and better align our workforce with the needs of our business in anticipation of the expiration of certain patents related to Treximet® (2018 Restructuring). The Company completed the realignment plan on January 5, 2018, resulting in a reduction of our workforce by 41 employees, the majority of which were associated with our sales force and commercial infrastructure. As of September 30, 2018, the Company has incurred $0.8 million in costs related to the 2018 Restructuring, consisting of $0.7 million related to employee termination benefits and $0.1 million related to contract termination costs. On July 7, 2016, the Company announced a restructuring of its sales force and operations (2016 Restructuring). The 2016 Reorganization included a reduction of 54 sales positions, primarily from the Company's Neurology sales team and reduced its administrative staff by 6 employees. To date, the Company has incurred $2.8 million in costs related to the 2016 Restructuring, consisting of $1.4 million related to employee termination benefits and $1.4 million related to contract termination costs. All associated contract termination cost payments are expected to be made by 2020. A summary of accrued restructuring costs, included as a component of accounts payable and accrued expenses on the unaudited condensed consolidated balance sheets, is as follows (in thousands): December 31, 2017 Charges Cash Non-cash September 30, 2018 2018 Restructuring $ - $ 774 $ (774) $ - $ - December 31, 2017 Charges Cash Non-cash September 30, 2018 2016 Restructuring $ 265 $ 438 $ (277) $ - $ 426

15. Supplemental Cash Flow Info

15. Supplemental Cash Flow Information	9 Months Ended
	Sep. 30, 2018
Supplemental Cash Flow Elements [Abstract]
15. Supplemental Cash Flow Information	Note 15. Supplemental Cash Flow Information Supplemental cash flow information is as follows (in thousands): Nine Months Ended September 30, 2018 2017 Cash (received) paid for income taxes, net $ 29 $ (873) Cash paid for interest 24,984 25,920 Supplemental disclosures of Non-cash Investing and Financing activities: Conversion of Treximet Secured Notes and interest to Common Stock $ 4,433 $ - Conversion of Treximet Secured Notes and interest to Convertible Preferred Stock 8,100 - Amount added to principal of Delayed Draw Term Loan and Exchangeable notes for Payment-in-kind (PIK) interest 1,308 - Conversion of 4.25% Convertible Notes - (51,775) Issuance of 1,100,498 shares in exchange transaction - 3,775 Issuance of Exchangeable Notes - 36,243

2. Basis of Presentation and _2

2. Basis of Presentation and Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2018
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying unaudited condensed consolidated financial statements included herein have been prepared by the Company in accordance with generally accepted accounting principles in the United States (GAAP) and under the rules and regulations of the United States Securities and Exchange Commission (SEC) for interim reporting. In management's opinion, the interim financial data presented includes all adjustments (consisting solely of normal recurring items) necessary for fair presentation. All intercompany accounts and transactions have been eliminated. Certain information required by GAAP has been condensed or omitted in accordance with rules and regulations of the SEC. Operating results for the three and nine months ended September 30, 2018 are not necessarily indicative of the results that may be expected for any future period or for the year ending December 31, 2018. These unaudited condensed consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements and the notes thereto for the year ended December 31, 2017, included in Pernix's 2017 Annual Report on Form 10-K filed with the SEC. The preparation of the unaudited condensed consolidated financial statements requires management to make estimates and assumptions relating to reporting of the assets and liabilities and the disclosure of contingent assets and liabilities to prepare these unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period in conformity with GAAP. Significant estimates of the Company include: revenue recognition, sales allowances such as returns on product sales, government program rebates, customer coupon redemptions, wholesaler/pharmacy discounts, product service fees, rebates and chargebacks, sales commissions, amortization, stock-based compensation, the determination of fair values of assets and liabilities in connection with business combinations, and deferred income taxes. Actual results could differ from these estimates.
Interim Financial Statements	The accompanying unaudited condensed consolidated financial statements included herein have been prepared by the Company in accordance with generally accepted accounting principles in the United States (GAAP) and under the rules and regulations of the United States Securities and Exchange Commission (SEC) for interim reporting. In management's opinion, the interim financial data presented includes all adjustments (consisting solely of normal recurring items) necessary for fair presentation. All intercompany accounts and transactions have been eliminated. Certain information required by GAAP has been condensed or omitted in accordance with rules and regulations of the SEC. Operating results for the three and nine months ended September 30, 2018 are not necessarily indicative of the results that may be expected for any future period or for the year ending December 31, 2018. These unaudited condensed consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements and the notes thereto for the year ended December 31, 2017, included in Pernix's 2017 Annual Report on Form 10-K filed with the SEC.
Management's Estimates and Assumptions	The preparation of the unaudited condensed consolidated financial statements requires management to make estimates and assumptions relating to reporting of the assets and liabilities and the disclosure of contingent assets and liabilities to prepare these unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period in conformity with GAAP. Significant estimates of the Company include: revenue recognition, sales allowances such as returns on product sales, government program rebates, customer coupon redemptions, wholesaler/pharmacy discounts, product service fees, rebates and chargebacks, sales commissions, amortization, stock-based compensation, the determination of fair values of assets and liabilities in connection with business combinations, and deferred income taxes. Actual results could differ from these estimates. Nasdaq Deficiency Notices On October 17, 2018, the Company received notice (the Minimum Market Value of Publicly Held Shares Notice) from the Nasdaq Stock Market LLC (Nasdaq) that the Company is not currently in compliance with the $15 million minimum market value of publicly held shares requirement of Nasdaq Listing Rule 5450(b)(3)(C). The Minimum Market Value of Publicly Held Shares Notice indicated that, consistent with Nasdaq Listing Rule 5810(c)(3)(D), the Company has until April 15, 2019 to regain compliance with the minimum market value of publicly held shares requirement by having the closing market value of publicly held shares, calculated by multiplying the closing bid price of the Company's common stock (Common Stock) by the Company's total shares outstanding (less any shares held by officers, directors or beneficial owners of 10% or more of the total shares outstanding ), meet or exceed $15 million for at least ten consecutive business days. On October 19, 2018, the Company received notice (the Minimum Bid Price Notice) from Nasdaq that the Company is not currently in compliance with the $1.00 minimum closing bid price requirement of Nasdaq Listing Rule 5450(a)(1). The Minimum Bid Price Notice indicated that, consistent with Nasdaq Listing Rule 5810(c)(3)(A), the Company has until April 17, 2019 to regain compliance with the minimum bid price requirement by having the closing bid price of the Common Stock meet or exceed $1.00 per share for at least ten consecutive business days. If the Company does not regain compliance with the minimum bid price requirement by April 17, 2019, the Company may be eligible to transfer the listing of the Common Stock from the Nasdaq Global Market to the Nasdaq Capital Market if, at the time of such transfer, the Company meets the initial listing requirement for market value of publicly held shares ($1 million) and all other initial listing standards for the Nasdaq Capital Market (except for the minimum bid price requirement) and provides Nasdaq with written notice of its intention to cure the minimum bid price requirement deficiency. In response, Nasdaq may provide the Company with an additional 180 day period to satisfy the minimum bid price requirement. However, if it appears to the Nasdaq staff that the Company will not be able to cure the deficiency, or if the Company is otherwise not eligible, Nasdaq will provide notice to the Company that the Common Stock will be subject to delisting pursuant to Nasdaq's delisting procedures. The notices do not result in the immediate delisting of the Common Stock from the Nasdaq Global Market. If the Common Stock is delisted from the Nasdaq Global Market, the holders of the Convertible Notes (as defined in Note 10 below) and the Exchangeable Notes (as defined in Note 10 below) would have the right to require the Company (in the case of the Convertible Notes) or Pernix Ireland Pain Designated Activity Company (PIP DAC) (in the case of the Exchangeable Notes) to repurchase all of the Convertible Notes and Exchangeable Notes owned by such holders at a price equal to 100% of the principal amount thereof, plus any accrued and unpaid interest thereon, within 35 business days following the Company or PIP DAC giving notice to such holders of the delisting. The Company's or PIP DAC's failure to pay such amounts when due would result in a default under the indentures governing the Convertible Notes or the Exchangeable Notes, as the case may be, which would ripen into an event of default immediately under the indenture governing the Convertible Notes, and within five days of becoming due under the indenture governing the Exchangeable Notes. Further, an event of default under either of these indentures would result in a cross-default under the Delayed Draw Term Loan (as defined in Note 10 below) as well as the ABL Facility (as defined in Note 10 below), which could result in indebtedness outstanding under those instruments to become immediately due and payable. In addition, any acceleration of the debt under the Convertible Notes, the Exchangeable Notes, the Delayed Draw Term Loan or the ABL Facility would trigger an event of default under the indenture governing the Treximet Secured Notes (as defined in Note 10 below), which could result in such indebtedness becoming immediately due and payable. Going Concern As of October 17, 2018, the Company was not in compliance with certain Nasdaq Global Market listing requirements. The Company's outstanding 4.25% Convertible Notes (as defined in Note 10 below) in the principal amount of $78.2 million that contain redemption features in the event the Company was not able to maintain its Nasdaq Global Market listing. In addition, the Company's outstanding Exchangeable Notes (as defined in Note 10 below) in the principal amount of $36.1 million contain redemption features in the event the Company is not able to maintain any Nasdaq listing. These factors raise substantial doubt about the ability of the Company to continue as a going concern within one year after the date that these financial statements are issued. The Company continues to seek other sources of capital and alternatives. However, if the Company is unable to raise sufficient capital or maintain its Nasdaq listing to prevent the redemption of its outstanding indebtness, the Company will not have sufficient liquidity to fund its business operations for at least the next year following the date that the financial statements are issued. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
Reclassifications	Certain prior period amounts have been reclassified to conform to the current period presentation including reclassifying capitalized debt issuance costs of approximately $1.5 million from "Prepaid expenses and other current assets" to the Company's long-term debt instruments within "Total liabilities" except for those related to revolving credit facilities. This reclassification had no effect on previously reported results of operations, financial position or cash flows.
Principles of Consolidation	The unaudited condensed consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries, and variable interest entities (VIEs) for which the Company is the primary beneficiary. All significant intercompany balances and transactions have been eliminated in consolidation. The Company evaluates its ownership, contractual, and other interests in entities that are not wholly owned to determine if these entities are VIEs, and, if so, whether the Company is the primary beneficiary of the VIE. In determining whether the Company is the primary beneficiary of a VIE and therefore required to consolidate the VIE, a qualitative approach is applied that determines whether the Company has both (1) the power to direct the activities of the VIE that most significantly impact the VIE's economic performance and (2) the obligation to absorb losses of, or the rights to receive benefits from, the VIE that could potentially be significant to that VIE. The Company will continuously assess whether it is the primary beneficiary of a VIE as changes to existing relationships or future transactions may result in the consolidation or deconsolidation of such VIE. During the three and nine months ended September 30, 2018, the Company's consolidated VIE includes Nalpropion™ Pharmaceuticals Inc. (Nalpropion), and the Company remains the primary beneficiary of Nalpropion (see note 4, Variable Interest Entity
Recently Adopted Accounting Pronouncements	Recently Adopted Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers (Topic 606) Revenue from Contracts with Customers The Company's new revenue recognition policy is as follows: Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those products or services. The Company generally enters into contracts to sell approved branded and generic pharmaceutical drugs. Product Sales Product sales revenue is recognized at the estimated consideration to be received when control has transferred to the customer, which is typically on delivery to the customer or, in the case of products that are subject to consignment agreements, when the customer removes product from the Company's consigned inventory location for shipment directly to a patient. Payment terms vary by customer and the products or services offered and is generally required in a term ranging from 30 to 90 days from date of shipment or satisfaction of the performance obligation. Significant Judgments Product sales contracts provide the customer with the right to return the product and also provide for a variety of discounts and allowances including, specialty distributor fees, wholesaler fees, prompt payment discounts, government rebates, government chargebacks, coupon programs and rebates under managed care plans which are accounted for as variable consideration. Returns are estimated through comparison of historical return data to their related sales on a production lot basis. Historical rates of return are determined for each product and are adjusted for known or expected changes in the marketplace specific to each product, when appropriate. Judgment is required to estimate the appropriate adjustments for variable consideration which is based on sales or invoice data, contractual terms, historical utilization rates, new information regarding changes in these programs regulations and guidelines that would impact the amount of the actual rebates, the Company's expectations regarding future utilization rates for these programs and channel inventory data. Contract Balances The timing of customer invoicing generally does not differ from the timing of revenue recognition. The Company records provisions for returns, specialty distributor fees, wholesaler fees, government rebates, coupon programs and rebates under managed care plans are included within current liabilities in the Company's consolidated balance sheets. Provision for prompt payment discounts are generally shown as a reduction in accounts receivable. In May 2017, the FASB issued ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting, In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business In August 2016, the FASB issued ASU 2016-15 Statement of Cash Flows - Classification of Certain Cash Receipts and Cash Payments In January 2016, the FASB issued ASU 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities
Recent Issued Accounting Pronouncements	Recently Issued Accounting Standards, Not Adopted as of September 30, 2018 In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820) - Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement In March 2018, the FASB issued ASU No. 2018-05, Income Taxes (Topic 740): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118 Income taxes In February 2016, the FASB issued ASU no. 2016-02, Leases Management does not believe that any other recently issued, but not yet effective, accounting standards if currently adopted would have a material effect on the Company's consolidated financial statements.
Revenue Recognition	The Company's new revenue recognition policy is as follows: Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those products or services. The Company generally enters into contracts to sell approved branded and generic pharmaceutical drugs. Product Sales Product sales revenue is recognized at the estimated consideration to be received when control has transferred to the customer, which is typically on delivery to the customer or, in the case of products that are subject to consignment agreements, when the customer removes product from the Company's consigned inventory location for shipment directly to a patient. Payment terms vary by customer and the products or services offered and is generally required in a term ranging from 30 to 90 days from date of shipment or satisfaction of the performance obligation. Significant Judgments Product sales contracts provide the customer with the right to return the product and also provide for a variety of discounts and allowances including, specialty distributor fees, wholesaler fees, prompt payment discounts, government rebates, government chargebacks, coupon programs and rebates under managed care plans which are accounted for as variable consideration. Returns are estimated through comparison of historical return data to their related sales on a production lot basis. Historical rates of return are determined for each product and are adjusted for known or expected changes in the marketplace specific to each product, when appropriate. Judgment is required to estimate the appropriate adjustments for variable consideration which is based on sales or invoice data, contractual terms, historical utilization rates, new information regarding changes in these programs regulations and guidelines that would impact the amount of the actual rebates, the Company's expectations regarding future utilization rates for these programs and channel inventory data. Contract Balances The timing of customer invoicing generally does not differ from the timing of revenue recognition. The Company records provisions for returns, specialty distributor fees, wholesaler fees, government rebates, coupon programs and rebates under managed care plans are included within current liabilities in the Company's consolidated balance sheets. Provision for prompt payment discounts are generally shown as a reduction in accounts receivable.
Significant Customers	Significant Customers The Company's customers consist of drug wholesalers, specialty pharmacies, retail drug stores, mass merchandisers and grocery store pharmacies in the United States. The Company primarily sells its products directly to large national drug wholesalers, which in turn resell the products to smaller or regional wholesalers, retail pharmacies, chain drug stores, and other third parties.
Earnings per Share	Basic net income (loss) per common share is the amount of net income (loss) for the period divided by the weighted average shares of Common Stock outstanding during the reporting period. Diluted income (loss) per common share is the amount of income (loss) for the period plus interest expense on convertible debt divided by the sum of weighted average shares of Common Stock outstanding during the reporting period and weighted average shares that would have been outstanding assuming the issuance of common shares for all dilutive potential common shares.

2. Significant Customers (Table

2. Significant Customers (Tables)	9 Months Ended
	Sep. 30, 2018
Accounting Policies [Abstract]
Significant Customers	The following tables list the Company's customers that individually comprised greater than 10% of total gross product sales for the three and nine months ended September 30, 2018 and 2017, or 10% of total accounts receivable as of September 30, 2018 and December 31, 2017. Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 McKesson Corporation 39% 35% 35% 34% AmerisourceBergen Drug Corporation 26% 29% 26% 30% Cardinal Health, Inc. 25% 23% 24% 24% Total 90% 87% 85% 88% Accounts Receivable, net: September 30, December 31, 2018 2017 McKesson Corporation 37% 29% Cardinal Health, Inc. 29% 31% AmerisourceBergen Drug Corporation 27% 27% Total 93% 87%

3. Business Combinations (Table

3. Business Combinations (Tables)	9 Months Ended
	Sep. 30, 2018
Business Combinations
Schedule of Purchase Price Allocation	The following table indicates the consideration transferred to effect the Orexigen Acquisition: Preliminary Purchase Price Allocation Cash consideration $ 68,500 Holdback 5,000 Total consideration transferred $ 73,500
Purchase price components of business combination	Assets Acquired and Liabilities Assumed The following table summarizes the estimated fair values of the assets acquired and liabilities assumed as of the acquisition date. The following recognized amounts are provisional and subject to change: amounts for intangible assets, property and equipment, certain liabilities, and other working capital balances pending finalization of the valuation; and amount of goodwill pending the completion of the valuation of the assets acquired and liabilities assumed. Amounts Recognized as of the Acquisition Date Cash and cash equivalents $ 730 Accounts receivable 27,700 Inventory (a) 18,219 Prepaids and other current assets 344 Property and equipment 426 Intangible assets (b) 50,500 Goodwill (c) 5,472 Accounts payable (1,097) Accrued allowances (13,574) Accrued personnel expense (841) Other liabilities - current (1,877) Deferred revenue (12,502) $ 73,500
Schedule of Acquired Finite-Lived Intangible Assets by Major Class [Table Text Block]	Preliminary Intangible Estimated Asset Useful Valuation Life Acquired developed technologies $ 44,800 10 years Tradenames 4,800 12 years Other 900 5 years $ 50,500
Business Acquisition, Pro Forma Information	Pro Forma Information The following table represents the consolidated financial information for the Company on a pro forma basis, assuming that the Orexigen Acquisition occurred as of January 1, 2017. The historical financial information has been adjusted to give effect to pro forma items that are directly attributable to the Orexigen Acquisition and are expected to have a continuing impact on the consolidated results. These items include, among others, adjustments to record the amortization of definite-lived intangible assets and interest expense. Additionally, the following table sets forth unaudited financial information and has been compiled from historical financial statements and other information, but is not necessarily indicative of the results that actually would have been achieved had the transactions occurred on the dates indicated or that may be achieved in the future. Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Net revenues $ 40,868 $ 59,372 $ 132,572 $ 165,931 Net income (loss) attributable to Pernix (22,371) 4,372 (59,890) (55,574) Net income (loss) per share attributable to Pernix: Basic $ (1.68) $ 0.39 $ (4.84) $ (5.35) Diluted $ (1.68) $ 0.30 $ (4.84) $ (5.35)

4. Variable Interest Entity (Ta

4. Variable Interest Entity (Tables)	9 Months Ended
	Sep. 30, 2018
Variable Interest Entity
Schedule of Variable Interest Entities [Table Text Block]	The following items of Nalpropion are included in the Company's condensed consolidated statement of operations for the three and nine months ended September 30, 2018: Three Months Ended September 30, 2018 Pernix Nalpropion Eliminations (1) Total Company Net revenues incl. related party $ 20,544 $ 17,923 $ (1,311) $ 37,156 Costs and operating expenses: Cost of product sales 6,470 6,664 (1,311) 11,823 Selling, general and administrative expense 14,857 17,015 - 31,872 Research and development expense 2 1,522 - 1,524 Depreciation and amortization expense 1,434 957 - 2,391 Other operating expenses 73 - - 73 Total costs and operating expenses 22,836 26,158 (1,311) 47,683 - - Income (loss) from operations (2,292) (8,235) - (10,527) Other income (expense): Interest expense, net (9,409) (664) (10,073) Other, net (83) (1,661) 1,056 (688) Total other income (expense), net (9,492) (2,325) 1,056 (10,761) Income (loss) before income tax expense $ (11,784) $ (10,560) $ 1,056 $ (21,288) (1) Included in Eliminations are transactions Pernix and Nalpropion enter into with one another. Such transactions include the sale of Contrave inventory from Nalpropion to Pernix and elimination of equity in earnings of Nalpropion. Nine Months Ended September 30, 2018 Pernix Nalpropion Eliminations (1) Total Company Net revenues incl. related party $ 69,771 $ 17,923 $ (1,311) $ 86,383 Costs and operating expenses: Cost of product sales 21,000 6,664 (1,311) 26,353 Selling, general and administrative expense 50,397 17,015 - 67,412 Research and development expense 12 1,522 - 1,534 Depreciation and amortization expense 12,729 957 - 13,686 Other operating expenses 1,430 - - 1,430 Total costs and operating expenses 85,568 26,158 (1,311) 110,415 Income (loss) from operations (15,797) (8,235) - (24,032) Other income (expense): Interest expense, net (28,399) (664) - (29,063) Other, net 363 (1,661) 1,056 (242) Total other income (expense), net (28,036) (2,325) 1,056 (29,305) Income (loss) before income tax expense $ (43,833) $ (10,560) $ 1,056 $ (53,337) (1) Included in Eliminations are transactions Pernix and Nalpropion enter into with one another. Such transactions include the sale of Contrave inventory from Nalpropion to Pernix and elimination of equity in earnings of Nalpropion. The following assets and liabilities of Nalpropion are included in the Company's condensed consolidated balance sheet as of September 30, 2018. As of September 30, 2018 Pernix Nalpropion Eliminations (1) Total Company Cash and cash equivalents (2) $ 18,202 $ 6,309 $ - $ 24,511 Accounts receivable, net (3) 58,907 7,536 - 66,443 Inventory, net 4,174 13,614 - 17,788 Related party receivable 5,841 38,305 (44,146) - Other current assets 4,844 7,136 - 11,980 Property and equipment, net 634 366 - 1,000 Goodwill 12,100 5,472 - 17,572 Intangible assets 84,047 49,602 - 133,649 Investment in VIE 3,528 - (3,528) - Related party loan 4,584 - (4,584) - Other assets 1,827 - - 1,827 - - Total assets $ 198,688 $ 128,340 $ (52,258) $ 274,770 Accounts payable and other accrued expenses $ 15,775 $ 10,856 $ - $ 26,631 Accrued allowances 54,543 17,155 - 71,698 Interest payable 5,784 597 - 6,381 Related party payable 38,305 5,841 (44,146) - Other liabilities - current 5,806 1,095 - 6,901 Long term debt excluding 2018 Term Loan 281,207 - - 281,207 2018 Term Loan - 45,834 (4,584) 41,250 Deferred revenue - 10,840 - 10,840 Other liabilities - long-term 2,144 - - 2,144 Total liabilities 403,564 $ 92,218 $ (48,730) $ 447,052 Total equity (204,876) $ 36,122 $ (36,038) $ (204,792) Noncontrolling interest - - 32,510 32,510 Total liabilities and equity $ 198,688 $ 128,340 $ (52,258) $ 274,770 (1) Included in Eliminations are transactions Pernix and Nalpropion enter into with one another. Such transactions may include the following: • Operating transactions in accordance with a services agreement between Nalpropion and Pernix. • Elimination of investments in Nalpropion. • Elimination of investments in Nalpropion’s earnings. (2) Approximately $12.2 million of cash and cash equivalents related to Nalpropion is held by Pernix at September 30, 2018. (3) Approximately $23.5 million of Pernix's accounts receivable, net includes accounts receivables related to sales of Contrave.

5. Earnings per Share (Tables)

5. Earnings per Share (Tables)	9 Months Ended
	Sep. 30, 2018
Earnings Per Share [Abstract]
Earnings per Share	The following table sets forth the computation of basic and diluted net income (loss) per share (in thousands except per share data): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Numerator: Net income (loss) $ (11,845) $ 6,360 $ (43,942) $ (44,718) Denominator - Basic: Weighted-average common shares 13,301 11,117 12,377 10,387 Numerator - Diluted: Net income (loss) $ (11,845) $ 6,360 $ (43,942) $ (44,718) Adjustment for interest, net of income tax effect - 599 - - Net income (loss), adjusted $ (11,845) $ 6,959 $ (43,942) $ (44,718) Denominator - Diluted: Weighted-average common shares 13,301 11,117 12,377 10,387 Effect of dilutive securities: Stock options, Awards and Warrants - 246 - - Exchangeable notes - 5,157 - - Dilutive potential common shares - 5,403 - - Weighted-average common shares, diluted 13,301 16,520 12,377 10,387 Basic income (loss) per share $ (0.89) $ 0.57 $ (3.55) $ (4.31) Diluted income (loss) per share $ (0.89) $ 0.42 $ (3.55) $ (4.31)
Antidilutive securitites	The following table sets forth the potential common shares that could potentially dilute basic income per share in the future that were not included in the computation of diluted income (loss) per share because to do so would have been anti-dilutive for the periods presented (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Treximet Secured Notes 27,238 - 27,238 - Exchangeable Notes 6,572 - 6,572 1,738 Converible Preferred Stock 3,389 - 3,389 - Stock options and restricted stock units 1,511 370 1,511 562 4.25% Convertible Notes 682 780 682 1,014 Warrants 4 - 4 33 Total potential dilutive effect 39,396 1,150 39,396 3,347

6. Fair Value Measurement (Tabl

6. Fair Value Measurement (Tables)	9 Months Ended
	Sep. 30, 2018
Fair Value Disclosures [Abstract]
Company's fair value hierarchy for its financial assets and liabilities measured at fair value on a recurring and nonrecurring basis	The fair and carrying value of our debt instruments are detailed as follows (in thousands): As of September 30, 2018 As of December 31, 2017 Fair Carrying Fair Carrying Value Value Value Value 4.25% Convertible Notes $ 33,714 $ 67,823 $ 36,208 $ 65,194 Exchangeable Notes 13,631 10,030 21,375 7,975 2018 Term loan 41,250 41,250 - - Delayed draw term loan 36,940 37,805 30,300 27,248 Derivative liability 54 54 93 93 Contingent consideration 1,501 1,501 1,358 1,358 Treximet Secured Notes 132,335 151,364 139,201 167,551 Total $ 259,425 $ 309,827 $ 228,535 $ 269,419
Fair Value Measurements Using Significant Unobservable Input (Tables)	For the Company's assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3), the following table provides a reconciliation of the beginning and ending balances for each category therein, and gains or losses recognized during the periods (in thousands). As of and for the As of and for the Nine Months Ended Nine Months Ended September 30, 2018 September 30, 2017 Derivative liability: Balance at beginning of year $ 93 $ 230 Impairment due to partial conversion - (90) Remeasurement adjustments - loss (gains) included in earnings (39) 38 Ending Balance $ 54 $ 178 Contingent consideration: Balance at beginning of year $ 1,358 $ 2,403 Remeasurement adjustments - loss (gains) included in earnings 143 344 Ending Balance $ 1,501 $ 2,747

7. Inventory (Tables)

7. Inventory (Tables)	9 Months Ended
	Sep. 30, 2018
Inventory Disclosure [Abstract]
Schedule of Inventory	Inventories are stated at the lower of cost or market. Inventories consist of the following (in thousands): September 30, December 31, 2018 2017 Raw materials $ 4,297 $ 727 Work-in-process 2,957 238 Finished goods 11,524 5,889 Inventory, gross 18,778 6,854 Reserve for obsolescence (990) (1,458) Inventory, net $ 17,788 $ 5,396

8. Goodwill and Intangible As_2

8. Goodwill and Intangible Assets (Tables)	9 Months Ended
	Sep. 30, 2018
Goodwill and Intangible Assets Disclosure [Abstract]
Changes in the carrying amount of goodwill	Goodwill consists of the following (in thousands): Amount Balance at December 31, 2016 $ 30,600 Impairment (18,500) Balance at December 31, 2017 12,100 Additions 5,472 Impairment - Balance at September 30, 2018 $ 17,572
Intangible assets	Intangible assets consist of the following (dollars in thousands): As of September 30, 2018 Weighted Average Gross Carrying Accumulated Net Carrying Life Remaining Amount Impairment Amortization Amount Unamortized intangible assets: In-process research and development Indefinite $ 11,000 $ - $ - $ 11,000 Total unamortized intangible assets 11,000 - - 11,000 Amortized intangible assets: Product licenses 4.8 years 2,846 - (1,823) 1,023 Supplier contracts 2.6 years 583 - (282) 301 Customer Lists 4.8 years 900 - (32) 868 Tradename 11.8 years 4,800 - (71) 4,729 Acquired developed technologies 12.7 years 409,486 - (293,758) 115,728 Total amortized intangible assets 418,615 - (295,966) 122,649 Total intangible assets $ 429,615 $ - $ (295,966) $ 133,649 As of December 31, 2017 Weighted Average Gross Carrying Accumulated Net Carrying Life Remaining Amount Impairment Amortization Amount Unamortized intangible assets: In-process research and development Indefinite $ 11,000 $ - $ - $ 11,000 Total unamortized intangible assets 11,000 - - 11,000 Amortized intangible assets: Product licenses 5.4 years 2,846 - (1,623) 1,223 Supplier contracts 3.3 years 583 - (194) 389 Acquired developed technologies 13.7 years 364,686 - (280,692) 83,994 Total amortized intangible assets 368,115 - (282,509) 85,606 Total intangible assets $ 379,115 $ - $ (282,509) $ 96,606
Intangible Assets Estimated Amortization Expenses	Estimated amortization expense related to intangible assets with definite lives for each of the five succeeding years and thereafter is as follows (in thousands): Amount 2018 (October - December) $ 2,642 2019 10,567 2020 10,480 2021 10,385 2022 10,346 Thereafter 78,229 Total $ 122,649

9. Accrued Allowances (Tables)

9. Accrued Allowances (Tables)	9 Months Ended
	Sep. 30, 2018
Accrued Liabilities [Abstract]
Accrued allowances	Accrued allowances consist of the following (in thousands): September 30, December 31, 2018 2017 Accrued returns allowance $ 25,370 $ 21,681 Accrued price adjustments 22,823 10,766 Accrued managed care rebates 17,230 17,221 Accrued government program rebates 6,275 6,641 Total $ 71,698 $ 56,309

10. Debt and Lines of Credit (T

10. Debt and Lines of Credit (Tables)	9 Months Ended
	Sep. 30, 2018
Debt Disclosure [Abstract]
Debt consists	Debt, net of discounts and deferred financing costs, consists of the following (in thousands): As of September 30, 2018 As of December 31, 2017 Principal Note Discount Deferred Financing Costs Net of Discount and Deferred Financing Costs Principal Note Discount Deferred Financing Costs Net of Discount and Deferred Financing Costs 4.25% Convertible Notes $ 78,225 $ (8,828) $ (1,574) $ 67,823 $ 78,225 $ (11,060) $ (1,971) $ 65,194 Exchangeable Notes 36,145 (22,913) (3,202) 10,030 35,743 (24,363) (3,405) 7,975 Delayed Draw Term Loan 40,074 - (2,269) 37,805 30,000 - (2,752) 27,248 Treximet Secured Notes - Long Term 154,515 - (3,151) 151,364 166,697 - (2,810) 163,887 Treximet Secured Notes - Short Term - - - - 5,373 - (1,709) 3,664 2018 Term Loan 41,250 - - 41,250 - - - - ABL Facility 14,185 - - 14,185 14,185 - - 14,185 Total outstanding debt $ 364,394 $ (31,741) $ (10,196) $ 322,457 $ 330,223 $ (35,423) $ (12,647) $ 282,153 Less: Current portion of long-term debt - 3,664 Long-term debt outstanding, net $ 322,457 $ 278,489
Future maturity schedule of the outstanding debt and line of credit	The following table represents the future maturity schedule of the outstanding debt and line of credit at September 30, 2018 (in thousands): Amount 2018 (October - December) $ - 2019 - 2020 154,515 2021 119,475 2022 90,404 Thereafter - Total maturities 364,394 Less: Note discount (31,741) Deferred financing costs (10,196) Total outstanding debt, net $ 322,457

11. Stockholders' Equity (Table

11. Stockholders' Equity (Tables)	9 Months Ended
	Sep. 30, 2018
Stockholders Equity Tables
Stock option assumptions	The weighted average fair value of stock options granted during the periods and the assumptions used to estimate those values using the Black-Scholes option pricing mode were as follows: Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Weighted average expected stock price volatility 86.4% 88.0% 86.4% 87.6% Estimated dividend yield - - - - Risk-free interest rate 2.9% 2.0% 2.8% 2.0% Expected life of option (in years) 6.3 6.2 6.3 6.2 Weighted average grant date fair value per option $ 0.69 $ 2.15 $ 1.61 $ 2.15
Stock option activity	The following table shows the option activity, described above, during the nine months ended September 30, 2018 (shares and intrinsic value in thousands): Weighted Average Average Remaining Aggregate Exercise Contractual Life Intrinsic Shares Price (years) Value Options Outstanding at December 31, 2017 1,042 $ 13.80 8.8 Granted 556 2.17 Exercised - - Cancelled (228) 12.29 Expired - - Options outstanding at September 30, 2018 1,370 $ 9.34 8.7 $ 5 Options vested and expected to vest as of September 30, 2018 895 $ 12.86 8.3 $ 2 Options vested and exercisable as of September 30, 2018 339 $ 24.88 7.3 $ -
Restricted stock activity	The following table shows the Company's non-vested restricted stock activity during the nine months ended September 30, 2018 (shares in thousands): Weighted Average Grant Date Fair Shares Value Non-vested restricted stock outstanding at December 31, 2017 135 $ 3.17 Granted 62 2.46 Vested (54) 3.25 Forfeited (2) 2.60 Non-vested restricted stock outstanding at September 30, 2018 141 $ 2.83

14. Restructuring (Tables)

14. Restructuring (Tables)	9 Months Ended
	Sep. 30, 2018
Restructuring and Related Activities [Abstract]
Accrued restructuring costs	A summary of accrued restructuring costs, included as a component of accounts payable and accrued expenses on the unaudited condensed consolidated balance sheets, is as follows (in thousands): December 31, 2017 Charges Cash Non-cash September 30, 2018 2018 Restructuring $ - $ 774 $ (774) $ - $ - December 31, 2017 Charges Cash Non-cash September 30, 2018 2016 Restructuring $ 265 $ 438 $ (277) $ - $ 426

15. Schedule of Cash Flow, Supp

15. Schedule of Cash Flow, Supplemental Disclosures (Tables)	9 Months Ended
	Sep. 30, 2018
Schedule Of Cash Flow Supplemental Disclosures
Schedule of cash flow, supplemental disclosures	Supplemental cash flow information is as follows (in thousands): Nine Months Ended September 30, 2018 2017 Cash (received) paid for income taxes, net $ 29 $ (873) Cash paid for interest 24,984 25,920 Supplemental disclosures of Non-cash Investing and Financing activities: Conversion of Treximet Secured Notes and interest to Common Stock $ 4,433 $ - Conversion of Treximet Secured Notes and interest to Convertible Preferred Stock 8,100 - Amount added to principal of Delayed Draw Term Loan and Exchangeable notes for Payment-in-kind (PIK) interest 1,308 - Conversion of 4.25% Convertible Notes - (51,775) Issuance of 1,100,498 shares in exchange transaction - 3,775 Issuance of Exchangeable Notes - 36,243

2. Significant Customers (Detai

2. Significant Customers (Details)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Company's customers that individually comprised greater than 10% of total gross product sales
Percentage of gross product sales	90.00%	87.00%	85.00%	88.00%
McKesson Corporation
Company's customers that individually comprised greater than 10% of total gross product sales
Percentage of gross product sales	39.00%	35.00%	35.00%	34.00%
Amerisource Bergen Drug Corporation
Company's customers that individually comprised greater than 10% of total gross product sales
Percentage of gross product sales	26.00%	29.00%	26.00%	30.00%
Cardinal Health Inc
Company's customers that individually comprised greater than 10% of total gross product sales
Percentage of gross product sales	25.00%	23.00%	24.00%	24.00%

2. Significant Customers (Det_2

2. Significant Customers (Details 1)	9 Months Ended	12 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Accounts Receivable
McKesson Corporation	37.00%	29.00%
Cardinal Health, Inc.	29.00%	31.00%
AmerisourceBergen Drug Corporation	27.00%	27.00%
Total	93.00%	87.00%

3. Business Combinations (Consi

3. Business Combinations (Consideration Transferred) (Details) $ in Thousands	3 Months Ended
	Jul. 27, 2018USD ($)
Business Combinations Consideration Transferred
Cash consideration	$ 68,500
Holdback	5,000
Total consideration transferred	$ 73,500

3. Business Combinations (Purch

3. Business Combinations (Purchase Price Components) (Details) $ in Thousands	Sep. 30, 2018USD ($)
Business Combinations Purchase Price Components
Cash and cash equivalents	$ 730
Accounts receivable	27,700
Inventory	18,219
Prepaids and other current assets	344
Property and equipment	426
Intangible assets	50,500
Goodwill	5,472
Accounts payable	(1,097)
Accrued allowances	(13,574)
Accrued personnel expense	(841)
Other liabilities - current	(1,877)
Deferred revenue	(12,502)
Net	$ 73,500

3. Business Combinations (Acqui

3. Business Combinations (Acquired Intangibles (Value and Useful Lives) (Details) - Orexigen $ in Thousands	3 Months Ended
	Jul. 27, 2018USD ($)
Preliminary Intangible Asset Valuation	$ 50,500
Acquired developed technologies
Preliminary Intangible Asset Valuation	$ 44,800
Estimated Useful Life	10 years
Tradenames
Preliminary Intangible Asset Valuation	$ 4,800
Estimated Useful Life	12 years
Other
Preliminary Intangible Asset Valuation	$ 900
Estimated Useful Life	5 years

3. Business Combinations (Pro F

3. Business Combinations (Pro Forma Financial Information with Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Business Combinations Pro Forma Financial Information With Narrative
Net revenues	$ 40,868	$ 59,372	$ 132,572	$ 165,931
Net income (loss) attributable to Pernix	$ (22,371)	$ 4,372	$ (59,830)	$ (55,574)
Net income (loss) per share attributable to Pernix
Business Acquisition, Pro Forma Earnings Per Share, Basic	$ (1.68)	$ 0.39	$ (4.84)	$ (5.35)
Business Acquisition, Pro Forma Earnings Per Share, Diluted	$ (1.68)	$ 0.30	$ (4.84)	$ (5.35)

4. VIE Condensed Consolidating

4. VIE Condensed Consolidating Statements of Operations (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Net revenues	$ 37,156	$ 40,469	$ 86,383	$ 104,527
Costs and operating expenses:
Cost of product sales	11,823	10,580	26,353	31,113
Selling, general and administrative expense	31,872	20,226	67,412	59,519
Research and development expense	1,524	99	1,534	709
Depreciation and amortization expense	2,391	18,214	13,686	54,976
Other operating expenses	73		1,430
Total costs and operating expenses	47,683	39,455	110,415	136,244
Income (loss) from operations	(10,527)	1,014	(24,032)	(31,717)
Other income (expense):
Interest expense, net	(10,073)	(9,323)	(29,063)	(27,491)
Other, net	(688)		(242)
Total other income (expense), net	(10,761)	5,373	(29,305)	(12,879)
Income (loss) before income tax expense	(21,288)	$ 6,387	(53,337)	$ (44,596)
Pernix
Net revenues	20,544		69,771
Costs and operating expenses:
Cost of product sales	6,470		21,000
Selling, general and administrative expense	14,857		50,397
Research and development expense	2		12
Depreciation and amortization expense	1,434		12,729
Other operating expenses	73		1,430
Income (loss) from operations	(2,292)		(15,797)
Other income (expense):
Interest expense, net	(9,409)		(28,399)
Other, net	(83)		363
Total other income (expense), net	(9,492)		(28,036)
Income (loss) before income tax expense	(11,784)		(43,833)
Nalpropion
Net revenues	17,923		17,923
Costs and operating expenses:
Cost of product sales	6,664		6,664
Selling, general and administrative expense	17,015		17,015
Research and development expense	1,522		1,522
Depreciation and amortization expense	957		957
Other operating expenses	0		0
Income (loss) from operations	(8,235)		(8,235)
Other income (expense):
Interest expense, net	(664)		(664)
Other, net	(1,661)		(1,661)
Total other income (expense), net	(2,325)		(2,325)
Income (loss) before income tax expense	(10,560)		(10,560)
Consolidation, Eliminations [Member]
Net revenues	(1,311)		(1,311)
Costs and operating expenses:
Cost of product sales	(1,311)		(1,311)
Selling, general and administrative expense	0		0
Research and development expense	0		0
Depreciation and amortization expense	0		0
Other operating expenses	0		0
Income (loss) from operations	0		0
Other income (expense):
Interest expense, net	0		0
Other, net	1,056		1,056
Total other income (expense), net	1,056		1,056
Income (loss) before income tax expense	$ 1,056		$ 1,056

4. VIE Condensed Consolidatin_2

4. VIE Condensed Consolidating Balance Sheet (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017	Sep. 30, 2017	Dec. 31, 2016
Cash and cash equivalents	$ 24,511	$ 32,820	$ 27,241	$ 36,375
Accounts receivable, net	66,443	45,317
Inventory, net	17,788	5,396
Related party receivable	0
Other currents assets	11,980
Property and equipment, net	1,000	752
Goodwill	17,572	12,100		$ 30,600
Intangible assets	133,649	96,606
Investment in VIE	0
Relared party loan	0
Other	1,827	2,263
Total assets	274,770	204,005
Accounts payable and other accrued expenses	26,631
Accrued allowances	71,698	56,309
Interest payable	6,381	10,612
Related party payable	0
Other liabilities - current	6,901	2,648
Long term debt excluding 2018 Term Loan	281,207
2018 Term loan	41,250	0
Deferred revenue	10,840	0
Other liabilities - long-term	2,144
Total liabilities	447,052	378,262
Total equity	(204,792)	(174,257)
Noncontrolling interest	32,510	0
Total liabilities and equity	274,770	$ 204,005
Pernix
Cash and cash equivalents	18,202
Accounts receivable, net	58,907
Inventory, net	4,174
Related party receivable	5,841
Other currents assets	4,844
Property and equipment, net	634
Goodwill	12,100
Intangible assets	84,047
Investment in VIE	3,528
Relared party loan	4,584
Other	1,827
Total assets	198,688
Accounts payable and other accrued expenses	15,775
Accrued allowances	54,543
Interest payable	5,784
Related party payable	38,305
Other liabilities - current	5,806
Long term debt excluding 2018 Term Loan	281,207
2018 Term loan	0
Deferred revenue	0
Other liabilities - long-term	2,144
Total liabilities	403,564
Total equity	(204,876)
Noncontrolling interest	0
Total liabilities and equity	198,688
Nalpropion
Cash and cash equivalents	6,309
Accounts receivable, net	7,536
Inventory, net	13,614
Related party receivable	38,305
Other currents assets	7,136
Property and equipment, net	366
Goodwill	5,472
Intangible assets	49,602
Investment in VIE	0
Relared party loan	0
Other	0
Total assets	128,340
Accounts payable and other accrued expenses	10,856
Accrued allowances	17,155
Interest payable	597
Related party payable	5,841
Other liabilities - current	1,095
Long term debt excluding 2018 Term Loan	0
2018 Term loan	45,834
Deferred revenue	10,840
Other liabilities - long-term	0
Total liabilities	92,218
Total equity	36,122
Noncontrolling interest	0
Total liabilities and equity	128,340
Eliminations
Cash and cash equivalents	0
Accounts receivable, net	0
Inventory, net	0
Related party receivable	(44,146)
Other currents assets	0
Property and equipment, net	0
Investment in VIE	(3,528)
Relared party loan	4,584
Other	0
Total assets	(52,258)
Accounts payable and other accrued expenses	0
Accrued allowances	0
Interest payable	0
Related party payable	(44,146)
Other liabilities - current	0
Long term debt excluding 2018 Term Loan	0
2018 Term loan	(4,584)
Deferred revenue	0
Other liabilities - long-term	0
Total liabilities	(48,730)
Total equity	(36,038)
Noncontrolling interest	32,510
Total liabilities and equity	$ (52,258)

5. Earnings per Share (Details)

5. Earnings per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Numerator:
Net income (loss)	$ (11,845)	$ 6,360	$ (43,942)	$ (44,718)	$ (77,141)
Weighted-average common shares	13,301	11,117	12,377	10,387
Numerator - Diluted:
Net income (loss)	$ (11,845)	$ 6,360	$ (43,942)	$ (44,718)	$ (77,141)
Adjustment for interest, net of income tax effect	0	599	0	0
Net income, (loss) adjusted	$ (11,845)	$ 6,959	$ (43,942)	$ (44,718)
Denominator - Basic:
Weighted-average common shares	13,301	11,117	12,377	10,387
Effect of dilutive securities:
Stock options, Awards and Warrants	0	246	0	0
Exchangeable notes	0	5,157	0	0
Dilutive potential common shares	0	5,403	0	0
Weighted-average common shares, diluted	13,301	16,520	12,377	10,387
Basic income (loss) per share	$ (0.89)	$ 0.57	$ (3.55)	$ (4.31)
Diluted income (loss) per share	$ (0.89)	$ 0.42	$ (3.55)	$ (4.31)

5. Earnings Per Share Potential

5. Earnings Per Share Potentially Diluted Shares Excluded (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Anti-dilutive shares	39,396	1,150	39,396	3,347
Treximet
Anti-dilutive shares	27,238	0	27,238	0
Exchangeable Notes
Anti-dilutive shares	6,572	0	6,572	1,738
Convertible Preferred Stock
Anti-dilutive shares	3,389	0	3,389	0
Stock Options and Restricted Stock
Anti-dilutive shares	1,511	370	1,511	562
4.25% Convertible Notes
Anti-dilutive shares	682	780	682	1,014
Warrants
Anti-dilutive shares	4	0	4	33

6. Fair Value Measurement (Debt

6. Fair Value Measurement (Debt Instruments) (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Debt instruments, fair value	$ 259,425	$ 228,535
Debt instruments, carrying value	309,827	269,419
4.25% Convertible Notes
Debt instruments, fair value	33,714	36,208
Debt instruments, carrying value	67,823	65,194
Exchangeable Notes
Debt instruments, fair value	13,631	21,375
Debt instruments, carrying value	10,030	7,975
2018 Term Loan
Debt instruments, fair value	41,250	0
Debt instruments, carrying value	41,250	0
Delayed Draw Term Loan
Debt instruments, fair value	36,940	30,300
Debt instruments, carrying value	37,805	27,248
Derivative Liability
Debt instruments, fair value	54	93
Debt instruments, carrying value	54	93
Contingent Consideration
Debt instruments, fair value	1,501	1,358
Debt instruments, carrying value	1,501	1,358
Treximet Secured Notes
Debt instruments, fair value	132,335	139,201
Debt instruments, carrying value	$ 151,364	$ 167,551

6. Fair Value Measurements Usin

6. Fair Value Measurements Using Significant Unobservable Inputs (Level 3) (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Derivative Liability
Beginning balance	$ 93	$ 230
Impairment due tp partial conversion	0	(90)
Remeasurement adjustments - loss (gains) included in earnings	(39)	38
Ending balance	54	178
Contingent Consideration
Beginning balance	1,358	2,403
Remeasurement adjustments - loss (gains) included in earnings	143	344
Ending balance	$ 1,501	$ 2,747

7. Inventory (Details)

7. Inventory (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Inventory Disclosure [Abstract]
Raw materials	$ 4,297	$ 727
Work-in-process	2,957	238
Finished goods	11,524	5,889
Inventory gross	18,778	6,854
Reserve for obsolescence	(990)	(1,458)
Inventory, net	$ 17,788	$ 5,396

8. Goodwill and Intangible As_3

8. Goodwill and Intangible Assets - Goodwill (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2018	Dec. 31, 2016	Dec. 31, 2017
Goodwill And Intangible Assets - Goodwill
Goodwill	$ 17,572	$ 30,600	$ 12,100
Additions	5,472
Impairment	$ 0	$ (18,500)

8. Goodwill and Intangible As_4

8. Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Dec. 31, 2017	Dec. 31, 2016
Goodwill	$ 17,572	$ 12,100	$ 30,600
Increase in goodwill related to acquisitions	$ 5,472

8. Goodwill and Intangible As_5

8. Goodwill and Intangible Assets (Details 1) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Intangible assets consist of the following
Gross Carrying Amount	$ 429,615	$ 379,115
Impairment	0	0
Accumulated Amortization	(295,966)	(282,509)
Net Carrying Amount	133,649	96,606
In Process Research And Development Member
Intangible assets consist of the following
Gross Carrying Amount	11,000	11,000
Impairment	0	0
Accumulated Amortization	0	0
Net Carrying Amount	11,000	11,000
Total Indefinite Lived
Intangible assets consist of the following
Gross Carrying Amount	11,000	11,000
Impairment	0	0
Accumulated Amortization	0	0
Net Carrying Amount	$ 11,000	$ 11,000
Product Licenses Member
Intangible assets consist of the following
Weighted Average Life Remaining	4 years 288 days	5 years 144 days
Gross Carrying Amount	$ 2,846	$ 2,846
Impairment	0	0
Accumulated Amortization	(1,823)	(1,623)
Net Carrying Amount	$ 1,023	$ 1,223
Supplier Contracts Member
Intangible assets consist of the following
Weighted Average Life Remaining	2 years 216 days	3 years 108 days
Gross Carrying Amount	$ 583	$ 583
Impairment	0	0
Accumulated Amortization	(282)	(194)
Net Carrying Amount	$ 301	$ 389
Customer lists
Intangible assets consist of the following
Weighted Average Life Remaining	4 years 288 days
Gross Carrying Amount	$ 900
Impairment	0
Accumulated Amortization	(32)
Net Carrying Amount	$ 868
Tradenames
Intangible assets consist of the following
Weighted Average Life Remaining	11 years 288 days
Gross Carrying Amount	$ 4,800
Impairment	0
Accumulated Amortization	(71)
Net Carrying Amount	$ (293,758)
Acquired Developed Technology Member
Intangible assets consist of the following
Weighted Average Life Remaining	12 years 252 days	13 years 216 days
Gross Carrying Amount	$ 409,486	$ 364,686
Impairment	0	0
Accumulated Amortization	(293,758)	(280,692)
Net Carrying Amount	115,728	83,994
Total Definite Lived
Intangible assets consist of the following
Gross Carrying Amount	418,615	368,115
Impairment	0	0
Accumulated Amortization	(295,966)	(282,509)
Net Carrying Amount	$ 122,649	$ 85,606

8. Goodwill and Intangible As_6

8. Goodwill and Intangible Assets (Details 2) $ in Thousands	Sep. 30, 2018USD ($)
Estimated amortization expense related to intangible assets
2018 (October - December)	$ 2,642
2,019	10,567
2,020	10,480
2,021	10,385
2,022	10,346
Thereafter	78,229
Total	$ 122,649

8. Goodwill and Intangible As_7

8. Goodwill and Intangible Assets (Details Narrative) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization expense	$ 2,300	$ 18,200	$ 13,500	$ 54,800

9. Accrued Allowances (Details)

9. Accrued Allowances (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Accrued allowances consist of the following
Accrued returns allowance	$ 25,370	$ 21,681
Accrued price adjustments	22,823	10,766
Accrued managed care rebates	17,230	17,221
Accrued government program rebates	6,275	6,641
Total	$ 71,698	$ 56,309

10. Debt and Lines of Credit (D

10. Debt and Lines of Credit (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Total gross long-term debt	$ 364,394	$ 330,223
Less unamortized discount	(31,741)	(35,423)
Less unamortized deferred financing costs	(10,196)	(12,647)
Total net long-term debt	322,457	282,153
Less current portion of long-term debt	0	3,664
Long-term debt outstanding, net	322,457	278,489
4.25% Convertible Notes
Total gross long-term debt	78,225	78,225
Less unamortized discount	(8,828)	(11,060)
Less unamortized deferred financing costs	(1,574)	(1,971)
Total net long-term debt	$ 67,823	65,194
Debt, Description	<i>4.25% Convertible Notes </i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On April 22, 2015, the Company issued $130.0 million aggregate principal amount 4.25% Convertible Notes. The 4.25% Convertible Notes mature on April 1, 2021, unless earlier converted, redeemed or repurchased. Interest on the 4.25% Convertible Notes is payable on April 1 and October 1 of each year, beginning October 1, 2015.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The 4.25% Convertible Notes are governed by the terms of an indenture, between the Company and Wilmington Trust, National Association, each of which were entered into on April 22, 2015. The Company may not redeem the 4.25% Convertible Notes prior to April 6, 2019. However, the holders may convert their 4.25% Convertible Notes at any time prior to the close of business on the business day immediately preceding January 1, 2021 only under certain circumstances. The effective interest rate on the 4.25% Convertible Notes, including debt issuance costs and bifurcated conversion option derivative (discussed below), is 10.4%.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The Company is required to separate the conversion option in the 4.25% Convertible Notes under Accounting Standards Codification (ASC) 815, <i>Derivatives and Hedging</i>. During April 2015, the Company recorded the bifurcated conversion option valued at $28.5 million as a derivative liability, which created a discount on the debt. The derivative liability is marked to market through the other income (expense) section on the unaudited condensed consolidated statements of operations for each reporting period, while the discount created on the 4.25% Convertible Notes is accreted as interest expense over the life of the debt. The derivative liability is valued at $54,000 and $93,000 as of September 30, 2018 and December 31, 2017, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">Interest expense was $1.7 million and $5.1 million for the three and nine months ended September 30, 2018, respectively, and $1.9 million and $6.9 million for the three and nine months ended September 30, 2017, respectively, related to the 4.25% Convertible Notes. Interest expense includes amortization of deferred financing costs and accretion of debt discount.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">Change in fair value of derivative liability was a benefit of $18,000 and $39,000 for the three and nine months ended September 30, 2018, respectively, and a benefit of $46,000 and an expense of $38,000 for the three and nine months ended September 30, 2017, respectively. Accrued interest on the 4.25% Convertible Notes was approximately $1.7 million and $0.8 million as of September 30, 2018 and December 31, 2017, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">As a result of the Exchangeable Notes transaction during the third quarter of 2017, the Company recorded $14.7 million as gain from exchange of debt for the three months ended September 30, 2017.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p>" id="sjs-B14">&lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;i>4.25% Convertible Notes &lt;/i>&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On April 22, 2015, the Company issued $130.0 million aggregate principal amount 4.25% Convertible Notes. The 4.25% Convertible Notes mature on April 1, 2021, unless earlier converted, redeemed or repurchased. Interest on the 4.25% Convertible Notes is payable on April 1 and October 1 of each year, beginning October 1, 2015.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The 4.25% Convertible Notes are governed by the terms of an indenture, between the Company and Wilmington Trust, National Association, each of which were entered into on April 22, 2015. The Company may not redeem the 4.25% Convertible Notes prior to April 6, 2019. However, the holders may convert their 4.25% Convertible Notes at any time prior to the close of business on the business day immediately preceding January 1, 2021 only under certain circumstances. The effective interest rate on the 4.25% Convertible Notes, including debt issuance costs and bifurcated conversion option derivative (discussed below), is 10.4%.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The Company is required to separate the conversion option in the 4.25% Convertible Notes under Accounting Standards Codification (ASC) 815, &lt;i>Derivatives and Hedging&lt;/i>. During April 2015, the Company recorded the bifurcated conversion option valued at $28.5 million as a derivative liability, which created a discount on the debt. The derivative liability is marked to market through the other income (expense) section on the unaudited condensed consolidated statements of operations for each reporting period, while the discount created on the 4.25% Convertible Notes is accreted as interest expense over the life of the debt. The derivative liability is valued at $54,000 and $93,000 as of September 30, 2018 and December 31, 2017, respectively.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">Interest expense was $1.7 million and $5.1 million for the three and nine months ended September 30, 2018, respectively, and $1.9 million and $6.9 million for the three and nine months ended September 30, 2017, respectively, related to the 4.25% Convertible Notes. Interest expense includes amortization of deferred financing costs and accretion of debt discount.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">Change in fair value of derivative liability was a benefit of $18,000 and $39,000 for the three and nine months ended September 30, 2018, respectively, and a benefit of $46,000 and an expense of $38,000 for the three and nine months ended September 30, 2017, respectively. Accrued interest on the 4.25% Convertible Notes was approximately $1.7 million and $0.8 million as of September 30, 2018 and December 31, 2017, respectively.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">As a result of the Exchangeable Notes transaction during the third quarter of 2017, the Company recorded $14.7 million as gain from exchange of debt for the three months ended September 30, 2017.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p>
Exchangeable Notes
Total gross long-term debt	$ 36,145	35,743
Less unamortized discount	(22,913)	(24,363)
Less unamortized deferred financing costs	(3,202)	(3,405)
Total net long-term debt	$ 10,030	7,975
Debt, Description	<i>Exchangeable Notes</i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On July 20, 2017, the Company entered into an exchange agreement (the 2017 Exchange Agreement) with certain holders of its 4.25% Convertible Notes (Holders) pursuant to which $51.8 million of aggregate principal amount of its 4.25% Convertible Notes held by the Holders were exchanged for (i) $36.2 million aggregate principal amount of 4.25%/5.25% Exchangeable Senior Notes due 2022 (the Exchangeable Notes), issued by PIP DAC pursuant to an Indenture, dated July 21, 2017 (the Exchangeable Notes Indenture), among PIPL, the guarantors party thereto (the Guarantors), and Wilmington Trust, National Association, as Trustee and (ii) 1,100,498 shares of Common Stock.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The Exchangeable Notes issued under the Exchangeable Notes Indenture are guaranteed by the Company and each other subsidiary thereof. The Exchangeable Notes are senior, unsecured obligations of PIP DAC. Interest on the Exchangeable Notes will be paid in cash or a combination of cash and in-kind interest at PIP DAC's election. Interest paid in cash (the All Cash Method) will accrue at a rate of 4.25% per annum, while interest paid in a combination of cash and in-kind will accrue at a rate of 5.25% per annum, with 2.25% per annum (plus additional interest, if any) capitalized to the principal amount of the Exchangeable Notes, and the balance paid in cash. The maturity date of the Exchangeable Notes Indenture is July 15, 2022. The Exchangeable Notes initially are exchangeable into shares of Common Stock at an exchange price per share of $5.50 (the Exchange Price).</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The 2017 Exchange Agreement allowed the Company to reduce the principal amount of its outstanding indebtedness through the exchange of the Holders' 4.25% Convertible Notes for a smaller principal amount of the Exchangeable Notes. The principal amount of the Exchangeable Notes may be reduced if the Holders thereof exchange their Exchangeable Notes for shares of Common Stock. The Exchangeable Notes Indenture will provide capacity to refinance up to an additional $25.0 million principal amount of the 4.25% Convertible Notes, which refinancing could also provide an opportunity to further reduce the principal amount of the Company's outstanding indebtedness.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The outstanding borrowings of the Exchangeable Notes were paid down by $500,000 in November 2017 with a portion of the proceeds from the sale of certain non-core assets. Interest expense was $1.0 million and $3.0 million for the three and nine months ended September 30, 2018, respectively, and $0.6 million for the three and nine months ended September 30, 2017, related to the Exchangeable Notes and included amortization of deferred financing costs and accretion of debt discount. During the first quarter of 2018, PIP DAC elected the PIK option in lieu of making scheduled interest payments. The election increased the principal due on the Exchangeable Notes by $402,000 as of September 30, 2018. Accrued interest on the Exchangeable Notes was approximately $396,000 and $675,000 as of September 30, 2018 and December 31, 2017, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"></p>" id="sjs-B20">&lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;i>Exchangeable Notes&lt;/i>&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On July 20, 2017, the Company entered into an exchange agreement (the 2017 Exchange Agreement) with certain holders of its 4.25% Convertible Notes (Holders) pursuant to which $51.8 million of aggregate principal amount of its 4.25% Convertible Notes held by the Holders were exchanged for (i) $36.2 million aggregate principal amount of 4.25%/5.25% Exchangeable Senior Notes due 2022 (the Exchangeable Notes), issued by PIP DAC pursuant to an Indenture, dated July 21, 2017 (the Exchangeable Notes Indenture), among PIPL, the guarantors party thereto (the Guarantors), and Wilmington Trust, National Association, as Trustee and (ii) 1,100,498 shares of Common Stock.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The Exchangeable Notes issued under the Exchangeable Notes Indenture are guaranteed by the Company and each other subsidiary thereof. The Exchangeable Notes are senior, unsecured obligations of PIP DAC. Interest on the Exchangeable Notes will be paid in cash or a combination of cash and in-kind interest at PIP DAC's election. Interest paid in cash (the All Cash Method) will accrue at a rate of 4.25% per annum, while interest paid in a combination of cash and in-kind will accrue at a rate of 5.25% per annum, with 2.25% per annum (plus additional interest, if any) capitalized to the principal amount of the Exchangeable Notes, and the balance paid in cash. The maturity date of the Exchangeable Notes Indenture is July 15, 2022. The Exchangeable Notes initially are exchangeable into shares of Common Stock at an exchange price per share of $5.50 (the Exchange Price).&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The 2017 Exchange Agreement allowed the Company to reduce the principal amount of its outstanding indebtedness through the exchange of the Holders' 4.25% Convertible Notes for a smaller principal amount of the Exchangeable Notes. The principal amount of the Exchangeable Notes may be reduced if the Holders thereof exchange their Exchangeable Notes for shares of Common Stock. The Exchangeable Notes Indenture will provide capacity to refinance up to an additional $25.0 million principal amount of the 4.25% Convertible Notes, which refinancing could also provide an opportunity to further reduce the principal amount of the Company's outstanding indebtedness.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The outstanding borrowings of the Exchangeable Notes were paid down by $500,000 in November 2017 with a portion of the proceeds from the sale of certain non-core assets. Interest expense was $1.0 million and $3.0 million for the three and nine months ended September 30, 2018, respectively, and $0.6 million for the three and nine months ended September 30, 2017, related to the Exchangeable Notes and included amortization of deferred financing costs and accretion of debt discount. During the first quarter of 2018, PIP DAC elected the PIK option in lieu of making scheduled interest payments. The election increased the principal due on the Exchangeable Notes by $402,000 as of September 30, 2018. Accrued interest on the Exchangeable Notes was approximately $396,000 and $675,000 as of September 30, 2018 and December 31, 2017, respectively.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;/p>
Delayed Draw Term Loan
Total gross long-term debt	$ 40,074	30,000
Less unamortized discount	0	0
Less unamortized deferred financing costs	(2,269)	(2,752)
Total net long-term debt	$ 37,805	27,248
Debt, Description	<b><i>Term Facility:</i></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On July 21, 2017 PIP DAC entered into a term loan credit agreement (the Delayed Draw Term Loan, the Term Facility or DDTL) with Cantor Fitzgerald Securities, as agent and the lenders party thereto to obtain the DDTL. $30.0 million under the DDTL was drawn on July 21, 2017 in connection with the closing of several refinancing transactions and the remaining $15.0 million will be available for subsequent draws for certain specified purposes, including to finance certain acquisitions, subject to conditions set forth in the DDTL credit agreement. The DDTL includes an incremental feature that allows PIP DAC, with the consent of the requisite lenders under the Term Facility, to obtain up to an additional $20.0 million in term loan commitments. Interest on the loans will accrue either in cash or a combination of cash and in kind interest, at PIP DAC's election. Cash interest will accrue at a rate of 7.50% per annum, while the combination of cash and in-kind interest will accrue at a rate of 8.50% per annum, with up to 4.00% per annum added to the principal amount of loans and the balance paid in cash. The DDTL will mature on July 21, 2022. During the first quarter of 2018, PIP DAC elected the PIK option in lieu of making scheduled interest payments. The election increased the principal due on the DDTL by $906,000 as of September 30, 2018.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On July 27, 2018, PIP DAC drew $9.2 million under the DDTL. The proceeds were used to fund the Company's investment in Nalpropion for Nalpropion's purchase of certain assets of Orexigen and for working capital requirements.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">PIP DAC also entered into a mortgage debenture with Cantor Fitzgerald Securities as agent, pursuant to which PIP DAC's obligations under the DDTL will be secured by substantially all of the assets of PIP DAC and its future-acquired subsidiaries.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On August 1, 2018 the Company entered into an amendment of its Term Facility. These amendments were made to permit the exchange of the 12% Senior Secured Notes due 2020 (Treximet Secured Notes) for newly issued shares of Common Stock in the exchange transactions and equitization transaction (as defined below), and to amend certain terms of the Term Facility and the ABL Facility (collectively, the Credit Facilities), including (i) changes to permit the use of subsequent draws under the Term Facility for working capital or other general corporate purposes, and (ii) changes to the interest payment provisions under the Term Facility increasing the minimum percentage of interest that must be paid in cash to 6.00% per annum from 4.50% per annum.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">Interest expense was approximately $1.0 million and $2.6 million for the three and nine months ended September 30, 2018 related to the DDTL and includes amortization of deferred financing costs. Accrued interest on the DDTL was approximately $624,000 and $484,000 as of September 30, 2018 and December 31, 2017, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"></p>" id="sjs-B26">&lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;b>&lt;i>Term Facility:&lt;/i>&lt;/b>&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On July 21, 2017 PIP DAC entered into a term loan credit agreement (the Delayed Draw Term Loan, the Term Facility or DDTL) with Cantor Fitzgerald Securities, as agent and the lenders party thereto to obtain the DDTL. $30.0 million under the DDTL was drawn on July 21, 2017 in connection with the closing of several refinancing transactions and the remaining $15.0 million will be available for subsequent draws for certain specified purposes, including to finance certain acquisitions, subject to conditions set forth in the DDTL credit agreement. The DDTL includes an incremental feature that allows PIP DAC, with the consent of the requisite lenders under the Term Facility, to obtain up to an additional $20.0 million in term loan commitments. Interest on the loans will accrue either in cash or a combination of cash and in kind interest, at PIP DAC's election. Cash interest will accrue at a rate of 7.50% per annum, while the combination of cash and in-kind interest will accrue at a rate of 8.50% per annum, with up to 4.00% per annum added to the principal amount of loans and the balance paid in cash. The DDTL will mature on July 21, 2022. During the first quarter of 2018, PIP DAC elected the PIK option in lieu of making scheduled interest payments. The election increased the principal due on the DDTL by $906,000 as of September 30, 2018.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On July 27, 2018, PIP DAC drew $9.2 million under the DDTL. The proceeds were used to fund the Company's investment in Nalpropion for Nalpropion's purchase of certain assets of Orexigen and for working capital requirements.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">PIP DAC also entered into a mortgage debenture with Cantor Fitzgerald Securities as agent, pursuant to which PIP DAC's obligations under the DDTL will be secured by substantially all of the assets of PIP DAC and its future-acquired subsidiaries.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On August 1, 2018 the Company entered into an amendment of its Term Facility. These amendments were made to permit the exchange of the 12% Senior Secured Notes due 2020 (Treximet Secured Notes) for newly issued shares of Common Stock in the exchange transactions and equitization transaction (as defined below), and to amend certain terms of the Term Facility and the ABL Facility (collectively, the Credit Facilities), including (i) changes to permit the use of subsequent draws under the Term Facility for working capital or other general corporate purposes, and (ii) changes to the interest payment provisions under the Term Facility increasing the minimum percentage of interest that must be paid in cash to 6.00% per annum from 4.50% per annum.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">Interest expense was approximately $1.0 million and $2.6 million for the three and nine months ended September 30, 2018 related to the DDTL and includes amortization of deferred financing costs. Accrued interest on the DDTL was approximately $624,000 and $484,000 as of September 30, 2018 and December 31, 2017, respectively.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;/p>
Treximet Secured Notes
Total gross long-term debt	$ 154,515	166,697
Less unamortized discount	0	0
Less unamortized deferred financing costs	(3,151)	(2,810)
Total net long-term debt	$ 151,364	163,887
Debt, Description	<i>Treximet Note Offering</i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On August 19, 2014, the Company issued $220.0 million aggregate principal amount of its Treximet Secured Notes pursuant to an Indenture (the August 2014 Indenture) dated as of August 19, 2014 among the Company, certain of its subsidiaries (the Treximet Guarantors) and U.S. Bank National Association (the August 2014 Trustee), as trustee and collateral agent.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On April 13, 2015, the Company amended the August 2014 Indenture to allow the Company to, among other things, incur up to $42.2 million of additional debt. On December 29, 2017, the Company and the August 2014 Trustee entered into a third supplemental indenture to amend the August 2014 Indenture to clarify the definition of "Net Sales", as such term is defined in the August 2014 Indenture and resulted in the deferral of $3.2 million of principal payments until maturity of the notes.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The Treximet Secured Notes mature on August 1, 2020 and bear interest at a rate of 12% per annum, payable in arrears on February 1 and August 1 of each year (each, a Payment Date), beginning on February 1, 2015. On each Payment Date, commencing August 1, 2015, the Company began paying installments of principal of the Treximet Secured Notes in an amount equal to 50% of net sales of Treximet for the two consecutive fiscal quarters immediately preceding such Payment Date (less the amount of interest paid on the Treximet Secured Notes on such Payment Date). At each month-end beginning with January 2015, the net sales of Treximet will be calculated, the monthly interest accrual amount will then be deducted from the net sales and this resulting amount will be recorded as the current portion of the Treximet Secured Notes. If the Treximet net sales less the interest due at the end of each six-month period does not result in any excess over the interest due, no principal payment must be paid at that time. The remaining balance outstanding on the Treximet Secured Notes will be due on the maturity date, which is August 1, 2020. As of September 30, 2018, the principal amount outstanding of the Treximet Secured Notes is $154.5 million and is classified as a non-current liability. As of December 31, 2017, the Company classified $5.4 million, of the Treximet Secured Notes as a current liability and $166.7 million as a non-current liability at December 31, 2017.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The Treximet Secured Notes are secured by a continuing first-priority security interest in substantially all of the assets of the Company and the Treximet Guarantors related to Treximet other than inventory and certain inventory related assets, including accounts arising from the sale of the inventory.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On August 1, 2018, the Company entered into an exchange agreement (2018 Exchange Agreement) with certain holders (Exchange Holders) of the Treximet Secured Notes for newly issued shares of Common Stock and shares of a newly created class of convertible preferred stock of the Company designated as Convertible Preferred Stock (Exchange Transactions).</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The Exchange Transactions closed on August 1, 2018 and were as follows:</p> <ul> <li style="margin: 0pt 0 12pt; font-size: 10pt"><font style="font-family: Times New Roman, Times, Serif">exchange of approximately $2.7 million aggregate principal amount of the Treximet Secured Notes for 1,204,586 shares of Common Stock which includes $0.2 million of accrued and unpaid interest on the Treximet Secured Notes;</font></li> <li style="margin: 0pt 0 12pt; font-size: 10pt"><font style="font-family: Times New Roman, Times, Serif">exchange of $8.0 million principal amount of the Treximet Secured Notes plus $0.1 million of accrued and unpaid interest for 81,000 shares of Convertible Preferred Stock.</font></li> </ul> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The 2018 Exchange Agreement affords certain Exchange Holders the right to exchange up to an additional $65.1 million aggregate principal amount of the Treximet Secured Notes plus accrued and unpaid interest, into additional Convertible Preferred Stock until February 1, 2020. The Company evaluated the transaction under ASC 470-50, <i>Debtors Accounting for a Modification or Exchange of Debt Instruments</i> and determined the inclusion of the conversion right was not substantive and therefore does not constitute a debt extinguishment.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On August 1, 2018, the Company entered into separate Equitization Exchange Agreements by and among Pernix and certain Equitization Holders of Treximet Secured Notes. Pursuant to the Equitization Exchange Agreements, the Company issued 650,190 shares of its Common Stock in exchange for approximately $1.5 million aggregate principal amount of Treximet Secured Notes held by such Equitization Holders plus $0.1 million of accrued and unpaid interest thereon (Equitization Transaction). This transaction closed on August 1, 2018.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">As a result of the Exchange Transactions and Equitization Transaction, the Company recorded a net gain on early extinguishment of debt of $0.1 million.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">Interest expense related to the Treximet Secured Notes was $5.2 million and $16.1 million for the three and nine months ended September 30, 2018, respectively, and was $5.6 million and $17.2 million for the three and nine months ended September 30, 2017, respectively. Interest expense includes amortization of deferred financing costs. Accrued interest on the Treximet Secured Notes was approximately $3.1 million and $8.6 million as of September 30, 2018 and December 31, 2017, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"></p>" id="sjs-B32">&lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;i>Treximet Note Offering&lt;/i>&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On August 19, 2014, the Company issued $220.0 million aggregate principal amount of its Treximet Secured Notes pursuant to an Indenture (the August 2014 Indenture) dated as of August 19, 2014 among the Company, certain of its subsidiaries (the Treximet Guarantors) and U.S. Bank National Association (the August 2014 Trustee), as trustee and collateral agent.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On April 13, 2015, the Company amended the August 2014 Indenture to allow the Company to, among other things, incur up to $42.2 million of additional debt. On December 29, 2017, the Company and the August 2014 Trustee entered into a third supplemental indenture to amend the August 2014 Indenture to clarify the definition of &#34;Net Sales&#34;, as such term is defined in the August 2014 Indenture and resulted in the deferral of $3.2 million of principal payments until maturity of the notes.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The Treximet Secured Notes mature on August 1, 2020 and bear interest at a rate of 12% per annum, payable in arrears on February 1 and August 1 of each year (each, a Payment Date), beginning on February 1, 2015. On each Payment Date, commencing August 1, 2015, the Company began paying installments of principal of the Treximet Secured Notes in an amount equal to 50% of net sales of Treximet for the two consecutive fiscal quarters immediately preceding such Payment Date (less the amount of interest paid on the Treximet Secured Notes on such Payment Date). At each month-end beginning with January 2015, the net sales of Treximet will be calculated, the monthly interest accrual amount will then be deducted from the net sales and this resulting amount will be recorded as the current portion of the Treximet Secured Notes. If the Treximet net sales less the interest due at the end of each six-month period does not result in any excess over the interest due, no principal payment must be paid at that time. The remaining balance outstanding on the Treximet Secured Notes will be due on the maturity date, which is August 1, 2020. As of September 30, 2018, the principal amount outstanding of the Treximet Secured Notes is $154.5 million and is classified as a non-current liability. As of December 31, 2017, the Company classified $5.4 million, of the Treximet Secured Notes as a current liability and $166.7 million as a non-current liability at December 31, 2017.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The Treximet Secured Notes are secured by a continuing first-priority security interest in substantially all of the assets of the Company and the Treximet Guarantors related to Treximet other than inventory and certain inventory related assets, including accounts arising from the sale of the inventory.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On August 1, 2018, the Company entered into an exchange agreement (2018 Exchange Agreement) with certain holders (Exchange Holders) of the Treximet Secured Notes for newly issued shares of Common Stock and shares of a newly created class of convertible preferred stock of the Company designated as Convertible Preferred Stock (Exchange Transactions).&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The Exchange Transactions closed on August 1, 2018 and were as follows:&lt;/p> &lt;ul> &lt;li style="margin: 0pt 0 12pt; font-size: 10pt">&lt;font style="font-family: Times New Roman, Times, Serif">exchange of approximately $2.7 million aggregate principal amount of the Treximet Secured Notes for 1,204,586 shares of Common Stock which includes $0.2 million of accrued and unpaid interest on the Treximet Secured Notes;&lt;/font>&lt;/li> &lt;li style="margin: 0pt 0 12pt; font-size: 10pt">&lt;font style="font-family: Times New Roman, Times, Serif">exchange of $8.0 million principal amount of the Treximet Secured Notes plus $0.1 million of accrued and unpaid interest for 81,000 shares of Convertible Preferred Stock.&lt;/font>&lt;/li> &lt;/ul> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The 2018 Exchange Agreement affords certain Exchange Holders the right to exchange up to an additional $65.1 million aggregate principal amount of the Treximet Secured Notes plus accrued and unpaid interest, into additional Convertible Preferred Stock until February 1, 2020. The Company evaluated the transaction under ASC 470-50, &lt;i>Debtors Accounting for a Modification or Exchange of Debt Instruments&lt;/i> and determined the inclusion of the conversion right was not substantive and therefore does not constitute a debt extinguishment.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On August 1, 2018, the Company entered into separate Equitization Exchange Agreements by and among Pernix and certain Equitization Holders of Treximet Secured Notes. Pursuant to the Equitization Exchange Agreements, the Company issued 650,190 shares of its Common Stock in exchange for approximately $1.5 million aggregate principal amount of Treximet Secured Notes held by such Equitization Holders plus $0.1 million of accrued and unpaid interest thereon (Equitization Transaction). This transaction closed on August 1, 2018.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">As a result of the Exchange Transactions and Equitization Transaction, the Company recorded a net gain on early extinguishment of debt of $0.1 million.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">Interest expense related to the Treximet Secured Notes was $5.2 million and $16.1 million for the three and nine months ended September 30, 2018, respectively, and was $5.6 million and $17.2 million for the three and nine months ended September 30, 2017, respectively. Interest expense includes amortization of deferred financing costs. Accrued interest on the Treximet Secured Notes was approximately $3.1 million and $8.6 million as of September 30, 2018 and December 31, 2017, respectively.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;/p>
Treximet Secured - Short Term
Total gross long-term debt	$ 0	5,373
Less unamortized discount	0	0
Less unamortized deferred financing costs	0	(1,709)
Total net long-term debt	0	3,664
2018 Term Loan
Total gross long-term debt	41,250	0
Less unamortized discount	0	0
Less unamortized deferred financing costs	0	0
Total net long-term debt	$ 41,250	0
Line of Credit Facility, Description	<b><i>2018 Term Loan</i></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On July 27, 2018, Nalpropion entered into a credit agreement (2018 Credit Agreement) with Wilmington Savings Fund Society, FSB, as administrative and collateral agent, and certain lenders including PIP DAC and certain affiliates of Highbridge Capital Management, LLC (Highbridge) and Whitebox Advisors LLC (Whitebox, and collectively, the Lenders) from time to time party thereto providing for $45.8 million principal amount of a three-year term loan (the 2018 Term Loan). Loans under the 2018 Term Loan bear interest at 8.0% per year and mature on July 27, 2021. PIP DAC provided $4.6 million of the total commitment under the credit facility established under the 2018 Credit Agreement (2018 Credit Facility). Nalpropion borrowed the full $45.8 million available under the 2018 Term Loan to partially fund the Orexigen Acquisition and for working capital requirements. As PIP DAC is one of the lenders under the 2018 Credit Facility and provided $4.6 million of the total commitment under the 2018 Credit Facility, the $4.6 million is eliminated in consolidation as the transaction is between affiliates. As of September 30, 2018, $41.3 million of borrowings under the 2018 Term Loan related to the Company's consolidation of Nalpropion as a VIE is included in the Company's unaudited condensed consolidated balance sheets.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The borrowings under the 2018 Credit Agreement are secured, subject to customary permitted liens and other agreed upon exceptions, by a perfected security interest in the intangible assets of Nalpropion. Nalpropion is permitted to make voluntary prepayments at any time without payment of a premium or penalty. Nalpropion is required to make mandatory prepayments of outstanding indebtedness under the 2018 Credit Agreement (without payment of a premium) with (a) net cash proceeds from certain non-ordinary course asset sales (subject to reinvestment rights and other exceptions), (b) casualty proceeds and condemnation awards (subject to reinvestment rights and other exceptions), and (c) 75% of the excess cash flow generated during a semi-annual period (commencing with the period subsequent to June 30, 2019), depending on certain factors as defined in the 2018 Credit Agreement.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The 2018 Credit Agreement contains certain negative covenants (subject to exceptions, materiality thresholds and other allowances) including, without limitation, negative covenants that limit Nalpropion's ability to incur additional debt, guarantee other obligations, grant liens on assets, make loans, acquisitions or other investments, dispose of certain assets, make optional payments in connection with or modify certain debt instruments, pay dividends or make other payments on capital stock, engage in mergers or consolidations, enter into arrangements that restrict Nalpropion's ability to pay dividends or grant liens, engage in transactions with affiliates, or change its fiscal year.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">In addition, the 2018 Credit Agreement also contains customary events of default (with customary grace periods and materiality thresholds). Upon the occurrence of certain events of default, the obligations under the 2018 Credit Agreement may be accelerated and any remaining commitments thereunder may be terminated.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">Interest expense related to the 2018 Term Loan was $0.7 million for the three months ended September 30, 2018 of which $0.1 million is due to the Company and is eliminated in consolidation. As of September 30, 2018, $0.6 million of accrued interest on the 2018 Term Loan related to the Company's consolidation of Nalpropion as a VIE is included in the Company's unaudited condensed consolidated balance sheets.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p>" id="sjs-B43">&lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;b>&lt;i>2018 Term Loan&lt;/i>&lt;/b>&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On July 27, 2018, Nalpropion entered into a credit agreement (2018 Credit Agreement) with Wilmington Savings Fund Society, FSB, as administrative and collateral agent, and certain lenders including PIP DAC and certain affiliates of Highbridge Capital Management, LLC (Highbridge) and Whitebox Advisors LLC (Whitebox, and collectively, the Lenders) from time to time party thereto providing for $45.8&#160;million principal amount of a&#160;three-year&#160;term loan (the 2018 Term Loan). Loans under the 2018 Term Loan bear interest at 8.0% per year and mature on July 27, 2021. PIP DAC provided $4.6 million of the total commitment under the credit facility established under the 2018 Credit Agreement (2018 Credit Facility). Nalpropion borrowed the full $45.8 million available under the 2018 Term Loan to partially fund the Orexigen Acquisition and for working capital requirements. As PIP DAC is one of the lenders under the 2018 Credit Facility and provided $4.6 million of the total commitment under the 2018 Credit Facility, the $4.6 million is eliminated in consolidation as the transaction is between affiliates. As of September 30, 2018, $41.3 million of borrowings under the 2018 Term Loan related to the Company's consolidation of Nalpropion as a VIE is included in the Company's unaudited condensed consolidated balance sheets.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The borrowings under the 2018 Credit Agreement are secured, subject to customary permitted liens and other agreed upon exceptions, by a perfected security interest in the intangible assets of Nalpropion. Nalpropion is permitted to make voluntary prepayments at any time without payment of a premium or penalty. Nalpropion is required to make mandatory prepayments of outstanding indebtedness under the 2018 Credit Agreement (without payment of a premium) with (a)&#160;net cash proceeds from certain non-ordinary course asset sales (subject to reinvestment rights and other exceptions), (b)&#160;casualty proceeds and condemnation awards (subject to reinvestment rights and other exceptions), and (c)&#160;75% of the excess cash flow generated during a semi-annual period (commencing with the period subsequent to June 30, 2019), depending on certain factors as defined in the 2018 Credit Agreement.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The 2018 Credit Agreement contains certain negative covenants (subject to exceptions, materiality thresholds and other allowances) including, without limitation, negative covenants that limit Nalpropion's ability to incur additional debt, guarantee other obligations, grant liens on assets, make loans, acquisitions or other investments, dispose of certain assets, make optional payments in connection with or modify certain debt instruments, pay dividends or make other payments on capital stock, engage in mergers or consolidations, enter into arrangements that restrict Nalpropion's ability to pay dividends or grant liens, engage in transactions with affiliates, or change its fiscal year.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">In addition, the 2018 Credit Agreement also contains customary events of default (with customary grace periods and materiality thresholds). Upon the occurrence of certain events of default, the obligations under the 2018 Credit Agreement may be accelerated and any remaining commitments thereunder may be terminated.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">Interest expense related to the 2018 Term Loan was $0.7 million for the three months ended September 30, 2018 of which $0.1 million is due to the Company and is eliminated in consolidation. As of September 30, 2018, $0.6 million of accrued interest on the 2018 Term Loan related to the Company's consolidation of Nalpropion as a VIE is included in the Company's unaudited condensed consolidated balance sheets.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p>
ABL Credit Agreement
Total gross long-term debt	$ 14,185	14,185
Less unamortized discount	0	0
Less unamortized deferred financing costs	0	0
Total net long-term debt	$ 14,185	$ 14,185
Line of Credit Facility, Description	<i>Cantor Fitzgerald</i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On July 21, 2017, Pernix and certain subsidiaries of Pernix as borrowers and guarantors (the ABL Borrowers) and PIP DAC, Pernix Ireland Limited, Pernix Holdco 1, LLC, Pernix Holdco 2, LLC and Pernix Holdco 3, LLC as additional guarantors (the ABL Guarantors), entered into an asset-based revolving credit agreement (the ABL Credit Agreement) with Cantor Fitzgerald Securities, as agent (the ABL Agent) and the lenders party thereto to obtain a five-year $40 million asset-based revolving credit facility (the ABL Facility). On April 23, 2018, the Company entered into an amendment, effective as of April 12, 2018, to modify the borrowing base formula which determines the Company's capacity to draw on the ABL Facility, which could increase such capacity. The amendment also removed concentration limits for accounts receivable due from individual customers or other account debtors that may be included in the borrowing base.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The ABL Borrowers' obligations under the ABL Credit Agreement are guaranteed by the ABL Borrowers and the ABL Guarantors are secured by, among other things, the ABL Borrowers' cash, inventory and accounts receivable, in each case pursuant to a guaranty and security agreement between the ABL Borrowers, ABL Guarantors and Cantor Fitzgerald Securities as agent. Borrowings under the ABL Credit Agreement bear interest at the rate of LIBOR plus 7.50%, payable monthly, in addition to a commitment fee on any undrawn commitments at a rate per annum of 0.25%, payable monthly. The ABL Credit Agreement contains representations and warranties, affirmative and negative covenants, and events of default applicable to the Company, the other ABL Borrowers, the ABL Guarantors and their respective subsidiaries that are customary for credit facilities of this type. The ABL Credit Agreement will mature on July 21, 2022.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On August 1, 2018 the Company entered into an amendment of the ABL Facility. The amendment provides for certain changes to the borrowing base calculation under the ABL Facility that are intended to improve the Company's borrowing capacity under the ABL Facility and that will also permit the Company, among other things, to include Contrave inventory owned by the Company in the calculation of the borrowing base, and a reduction in the commitments under the ABL Facility from $40.0 million to $32.5 million.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">Interest expense was $0.5 million and $1.5 million for the three and nine months ended September 30, 2018, respectively, and was $0.4 million for the three and nine months ended September 30, 2017, related to the ABL Credit Agreement and includes amortization of deferred financing costs. As of September 30, 2018, unamortized debt issuance costs of $0.6 million and $1.6 million are recorded on the unaudited consolidated balance sheets in Prepaid expenses and other currents assets and Other assets, respectively, and are being amortized to interest expense over the life of the agreement. As of December 31, 2017, $0.6 million and $2.1 million of unamortized debt issuance costs are recorded on the unaudited consolidated balance sheets in Prepaid expenses and other currents assets and Other assets, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p>" id="sjs-B49">&lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;i>Cantor Fitzgerald&lt;/i>&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On July 21, 2017, Pernix and certain subsidiaries of Pernix as borrowers and guarantors (the ABL Borrowers) and PIP DAC, Pernix Ireland Limited, Pernix Holdco 1, LLC, Pernix Holdco 2, LLC and Pernix Holdco 3, LLC as additional guarantors (the ABL Guarantors), entered into an asset-based revolving credit agreement (the ABL Credit Agreement) with Cantor Fitzgerald Securities, as agent (the ABL Agent) and the lenders party thereto to obtain a five-year $40 million asset-based revolving credit facility (the ABL Facility). On April 23, 2018, the Company entered into an amendment, effective as of April 12, 2018, to modify the borrowing base formula which determines the Company's capacity to draw on the ABL Facility, which could increase such capacity. The amendment also removed concentration limits for accounts receivable due from individual customers or other account debtors that may be included in the borrowing base.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The ABL Borrowers' obligations under the ABL Credit Agreement are guaranteed by the ABL Borrowers and the ABL Guarantors are secured by, among other things, the ABL Borrowers' cash, inventory and accounts receivable, in each case pursuant to a guaranty and security agreement between the ABL Borrowers, ABL Guarantors and Cantor Fitzgerald Securities as agent. Borrowings under the ABL Credit Agreement bear interest at the rate of LIBOR plus 7.50%, payable monthly, in addition to a commitment fee on any undrawn commitments at a rate per annum of 0.25%, payable monthly. The ABL Credit Agreement contains representations and warranties, affirmative and negative covenants, and events of default applicable to the Company, the other ABL Borrowers, the ABL Guarantors and their respective subsidiaries that are customary for credit facilities of this type. The ABL Credit Agreement will mature on July 21, 2022.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On August 1, 2018 the Company entered into an amendment of the ABL Facility. The amendment provides for certain changes to the borrowing base calculation under the ABL Facility that are intended to improve the Company's borrowing capacity under the ABL Facility and that will also permit the Company, among other things, to include Contrave inventory owned by the Company in the calculation of the borrowing base, and a reduction in the commitments under the ABL Facility from $40.0 million to $32.5 million.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">Interest expense was $0.5 million and $1.5 million for the three and nine months ended September 30, 2018, respectively, and was $0.4 million for the three and nine months ended September 30, 2017, related to the ABL Credit Agreement and includes amortization of deferred financing costs. As of September 30, 2018, unamortized debt issuance costs of $0.6 million and $1.6 million are recorded on the unaudited consolidated balance sheets in Prepaid expenses and other currents assets and Other assets, respectively, and are being amortized to interest expense over the life of the agreement. As of December 31, 2017, $0.6 million and $2.1 million of unamortized debt issuance costs are recorded on the unaudited consolidated balance sheets in Prepaid expenses and other currents assets and Other assets, respectively.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p>
Wells Fargo Credit Facility
Line of Credit Facility, Description	<i>Wells Fargo</i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On August 21, 2015, the Company entered into a credit agreement with Wells Fargo, as Administrative Agent and the lenders party thereto for a $50.0 million, three-year senior secured revolving credit facility (the Wells Fargo Credit Facility).</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The ABL Facility entered into on July 21, 2017 replaced the Wells Fargo Credit Facility and the Company used the proceeds from the ABL Facility to repay the outstanding obligation of the Wells Fargo Credit Facility.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">Interest expense including amortization of deferred financing costs related to the Wells Fargo Credit Facility amounted to $142,000 and $748,000, for the three and nine months ending September 30, 2017, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p>" id="sjs-B51">&lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;i>Wells Fargo&lt;/i>&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">On August 21, 2015, the Company entered into a credit agreement with Wells Fargo, as Administrative Agent and the lenders party thereto for a $50.0 million, three-year senior secured revolving credit facility (the Wells Fargo Credit Facility).&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">The ABL Facility entered into on July 21, 2017 replaced the Wells Fargo Credit Facility and the Company used the proceeds from the ABL Facility to repay the outstanding obligation of the Wells Fargo Credit Facility.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">Interest expense including amortization of deferred financing costs related to the Wells Fargo Credit Facility amounted to $142,000 and $748,000, for the three and nine months ending September 30, 2017, respectively.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p>

10. Debt (Details 1)

10. Debt (Details 1) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Debt And Lines Of Credit Details 1
2018 (October - December)	$ 0
2,019	0
2,020	154,515
2,021	119,475
2,022	90,404
Thereafter	0
Total maturities	364,394	$ 330,223
Less: note discount	(31,741)	(35,423)
Less: deferred financing costs	(10,196)	$ (12,647)
Total outstanding debt	$ 322,457

11. Stockholders' Equity (Detai

11. Stockholders' Equity (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Weighted average of the assumptions used to value stock options on the date of grant
Weighted average expected stock price volatility	86.40%	88.00%	86.40%	87.60%
Estimated dividend yield	0.00%	0.00%	0.00%	0.00%
Risk-free interest rate	2.90%	2.00%	2.80%	2.00%
Expected life of option (in years)	6 years 108 days	6 years 72 days	6 years 108 days	6 years 72 days
Weighted average grant date fair value per option	$ 0.69	$ 2.15	$ 1.61	$ 2.15

11. Stockholders' Equity (Det_2

11. Stockholders' Equity (Details 1) $ / shares in Units, shares in Thousands, $ in Thousands	9 Months Ended
	Sep. 30, 2018USD ($)$ / sharesshares
Option Shares
Outstanding at December 31, 2017 | shares	1,042
Granted | shares	556
Exercised | shares	0
Cancelled | shares	(228)
Expired | shares	0
Outstanding at September 30, 2018 | shares	1,370
Options vested and expected to vest, as of September 30, 2018 | shares	895
Options vested and exercisable, as of September 30, 2018 | shares	339
Option Average Exercise Price
Outstanding at December 31, 2017 | $ / shares	$ 13.80
Granted | $ / shares	2.17
Exercised | $ / shares	0
Cancelled | $ / shares	12.29
Expired | $ / shares	0
Outstanding at September 30, 2018 | $ / shares	9.34
Options vested and expected to vest, as of September 30, 2018 | $ / shares	12.86
Options vested and exercisable, as of September 30, 2018 | $ / shares	$ 24.88
Option Weighted Average Remaining Contractual Life Years
Options outstanding at September 30, 2018	8 years 252 days
Options vested and expected to vest, as of September 30, 2018	8 years 108 days
Options vested and exercisable, as of September 30, 2018	7 years 108 days
Option Aggregate Intrinsic Value
Options outstanding at September 30, 2018 | $	$ 5
Options vested and expected to vest as of September 30, 2018 | $	2
Options vested and exercisable as of September 30, 2018 | $	$ 0

11. Stockholders' Equity (Det_3

11. Stockholders' Equity (Details 2) - Restricted shares $ / shares in Units, shares in Thousands, $ in Thousands	9 Months Ended
	Sep. 30, 2018USD ($)$ / sharesshares
Non-vested restricted stock outstanding at December 31, 2017 | shares	135
Granted | shares	62
Vested | shares	(54)
Forfeited | shares	(2)
Non-vested restricted stock outstanding at September 30, 2018 | shares	141
Weighted Average Grant Date Fair Value | $ / shares	$ 3.17
Granted | $ / shares	2.46
Vested | $ / shares	3.25
Forfeited | $ / shares	2.60
Weighted Average Grant Date Fair Value | $ / shares	$ 2.83
Unrecognized compensation cost related to non-vested retricted stock | $	$ 800
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition	1 year 349 days

13. Commitments and Contingen_2

13. Commitments and Contingencies (Details Narrative)	9 Months Ended
	Sep. 30, 2018
Texas Medicaid Fraud Prevention Act
Settlement description	During the first quarter of 2014, the Company settled all claims arising from certain actions by Cypress under the Texas Medicaid Fraud Prevention Act prior to its acquisition by the Company. As part of the settlement, the Company agreed to pay $12.0 million, payable in annual amounts of $2.0 million until the settlement is paid in full. As of September 30, 2018, the net present value of remaining payment obligations owed under this settlement agreement is $2.0 million and is recorded within other liabilities - current on the Company's unaudited condensed consolidated balance sheets as of September 30, 2018.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p>" id="sjs-B4">&lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">During the first quarter of 2014, the Company settled all claims arising from certain actions by Cypress under the Texas Medicaid Fraud Prevention Act prior to its acquisition by the Company. As part of the settlement, the Company agreed to pay $12.0 million, payable in annual amounts of $2.0 million until the settlement is paid in full. As of September 30, 2018, the net present value of remaining payment obligations owed under this settlement agreement is $2.0 million and is recorded within other liabilities - current on the Company's unaudited condensed consolidated balance sheets as of September 30, 2018.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p>
GSK
Settlement description	GlaxoSmithKline (GSK) Arbitration</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">Pursuant to Amendment No. 2, the Company agreed that if on or before September 30, 2019, the Company (x) redeems or repurchases its 4.25% Convertible Notes for greater than 31 cents for every one dollar of principal amount outstanding or (y) exchange such notes for new notes or similar instruments that have a face value providing such exchanging holders a recovery that is greater than 31 cents for every one dollar of 4.25% Convertible Notes exchanged by such holders, the Company shall, no later than five business days thereafter, distribute to GSK additional cash or notes, as applicable, equal to such excess recovery, but in no event to exceed $2.0 million.  GSK has agreed that for so long as the Company complies with the payment terms set forth in the Amendment No. 2, enforcement of the award will be stayed and GSK shall not seek to enforce or exercise any other remedies in respect of the award, and that the outstanding balance of the Award shall be unconditionally and irrevocably forgiven upon satisfaction of such terms.  As of September 30, 2018 and December 31, 2017, the Company has recorded $2.0 million as contingent consideration for the potential payment due by September 30, 2019 and is recorded in "other liabilities - current" and "Arbitration Award" on the Company's consolidated balance sheets, respectively. Also, the Company recorded $10.5 million as a gain from legal settlement for the year ended December 31, 2017 pursuant to Amendment No. 2 in the consolidated statements of operations and comprehensive loss.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"></p>" id="sjs-B6">&lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">GlaxoSmithKline (GSK) Arbitration&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">Pursuant to Amendment No. 2, the Company agreed that if on or before September 30, 2019, the Company (x) redeems or repurchases its 4.25% Convertible Notes for greater than 31 cents for every one dollar of principal amount outstanding or (y) exchange such notes for new notes or similar instruments that have a face value providing such exchanging holders a recovery that is greater than 31 cents for every one dollar of 4.25% Convertible Notes exchanged by such holders, the Company shall, no later than five business days thereafter, distribute to GSK additional cash or notes, as applicable, equal to such excess recovery, but in no event to exceed $2.0 million.&#160; GSK has agreed that for so long as the Company complies with the payment terms set forth in the Amendment No. 2, enforcement of the award will be stayed and GSK shall not seek to enforce or exercise any other remedies in respect of the award, and that the outstanding balance of the Award shall be unconditionally and irrevocably forgiven upon satisfaction of such terms.&#160; As of September 30, 2018 and December 31, 2017, the Company has recorded $2.0 million as contingent consideration for the potential payment due by September 30, 2019 and is recorded in &#34;other liabilities - current&#34; and &#34;Arbitration Award&#34; on the Company's consolidated balance sheets, respectively. Also, the Company recorded $10.5 million as a gain from legal settlement for the year ended December 31, 2017 pursuant to Amendment No. 2 in the consolidated statements of operations and comprehensive loss.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;/p>
Somaxon [Member]
Settlement description	In July 2012 and January 2013, Somaxon settled two patent litigation claims with parties seeking to market generic equivalents of Silenor.  As of September 30, 2018, remaining payment obligations of the Company owed under these settlement agreements are $250,000. The balance is payable in the third quarter 2019 and is recorded in "other liabilities - current" on the Company's unaudited condensed consolidated balance sheets as of September 30, 2018.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0"> </p>" id="sjs-B8">&lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">In July 2012 and January 2013, Somaxon settled two patent litigation claims with parties seeking to market generic equivalents of Silenor.&#160;&#160;As of September 30, 2018, remaining payment obligations of the Company owed under these settlement agreements are $250,000. The balance is payable in the third quarter 2019 and is recorded in &#34;other liabilities - current&#34; on the Company's unaudited condensed consolidated balance sheets as of September 30, 2018.&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&lt;/p> &lt;p style="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&#160;&lt;/p>

14. Restructuring (Details)

14. Restructuring (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Restructuring charges	$ (2)	$ (97)	$ 1,212	$ 34
2018 Restructuring
Accrued restructuring costs	0		0		$ 0
Restructuring charges			774
Restructuring cash			(774)
Restructuring noncash			0
2016 Restructuring
Accrued restructuring costs	$ 426		426		$ 265
Restructuring charges			438
Restructuring cash			$ (277)

15. Supplemental Cash Flow In_2

15. Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Supplemental disclosures of Cash Flow Information:
Cash (received) paid for income taxes, net	$ 29	$ (873)
Cash paid for interest	24,984	25,920
Supplemental disclosures of Non-cash Investing and Financing Activities:
Conversion of Treximet Secured Notes and interest to Common Stock	4,433	0
Conversion of Treximet Secured Notes and interest to Convertible Preferred Stock	8,100	0
Amount added to principal of Delayed Draw Term Loan and Exchangeable notes for Payment-in-kind (PIK) interest	1,308	0
Conversion of 4.25% Convertible notes	0	(51,775)
Issuance of 1,100,498 shares in exchange transaction	0	3,775
Issuance of Exchangeable Notes	$ 0	$ 36,243