Pernix Therapeutics 10-Q 12 May 14 2014 Q1 Quarterly report Financial data

Document_and_Entity_Informatio

Document and Entity Information	3 Months Ended
	Mar. 31, 2014	9-May-14
Document Information [Line Items]	'	'
Entity Registrant Name	'PERNIX THERAPEUTICS HOLDINGS, INC.	'
Entity Central Index Key	'0001024126	'
Document Type	'10-Q	'
Document Period End Date	31-Mar-14	'
Amendment Flag	'false	'
Current Fiscal Year End Date	'--12-31	'
Is Entity a Well-known Seasoned Issuer?	'No	'
Is Entity a Voluntary Filer?	'No	'
Is Entity's Reporting Status Current?	'Yes	'
Entity Filer Category	'Accelerated Filer	'
Entity Common Stock, Shares Outstanding	'	37,773,076
Document Fiscal Period Focus	'Q1	'
Document Fiscal Year Focus	'2014	'

CONDENSED_CONSOLIDATED_BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Current assets:	'	'
Cash and cash equivalents	$55,851,215	$15,646,963
Accounts receivable, net	31,884,179	25,681,371
Inventory, net	10,831,283	13,809,929
Prepaid expenses and other current assets	6,202,656	5,878,292
Note receivable, net of unamortized discount of $62,864 and $100,582, respectively	4,787,136	4,749,418
Prepaid income taxes	1,129,889	1,318,446
Deferred income taxes - current	10,877,000	9,301,000
Held for sale - assets, net of impairment charge of $6,456,966	3,294,859	'
Total current assets	124,858,217	76,385,419
Property and equipment, net	1,056,053	6,872,042
Other assets:	'	'
Goodwill	41,581,017	42,496,592
Intangible assets, net	78,864,295	80,022,283
Note receivable, net of unamortized discount of $270,891and $318,696,	4,579,109	4,531,304
Other long-term assets	5,930,444	1,078,655
Total assets	256,869,135	211,386,295
Current liabilities:	'	'
Accounts payable	5,878,659	3,443,629
Accrued personnel expense	4,010,995	3,803,274
Accrued allowances	39,003,810	34,285,578
Other accrued expenses	4,655,944	5,532,549
Put option and contingent consideration - Cypress acquisition	'	1,330,000
Other liabilities	6,398,751	4,072,933
Held for sale - liabilities	1,901,742	'
Debt	5,047,850	16,999,687
Total current liabilities	66,897,751	69,467,650
Long-term liabilities:	'	'
Other liabilities	11,755,119	14,387,766
Debt - long term	'	1,309,767
Deferred income taxes	10,654,000	15,499,000
Senior convertible notes	65,000,000	'
Total liabilities	154,306,870	100,664,183
Commitments and contingencies	'	'
STOCKHOLDERS' EQUITY	'	'
Common stock, $.01 par value, 90,000,000 shares authorized, 39,801,624 and 39,318,301 issued, and 37,502,908 and 37,189,351 outstanding at March 31, 2014 and December 31, 2013, respectively	375,029	371,893
Treasury stock, at cost (2,298,716 and 2,128,950 shares held at March 31, 2014 and December 31, 2013, respectively)	-4,680,566	-4,001,475
Additional paid-in capital	121,612,255	119,553,760
Retained deficit	-14,744,453	-5,202,066
Accumulated Total stockholders' equity	102,562,265	110,722,112
Total liabilities and stockholders' equity	$256,869,135	$211,386,295

CONDENSED_CONSOLIDATED_BALANCE1

CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) (Parenthetical) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Stockholders Equity	'	'
Common stock par value	$0.01	$0.01
Common stock shares authorized	90,000,000	90,000,000
Common stock shares issued	39,801,624	39,318,301
Common stock shares outstanding	37,502,908	37,189,351
Treasury Stock held, at cost	2,298,716	2,128,950
Unamortized discount, Current	$62,864	$100,582
Unamortized discount, Noncurrent	270,891	318,696
Asset Impairment Charges	$6,456,966	'

CONDENSED_CONSOLIDATED_STATEME

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) (USD $) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Income Statement [Abstract]	'	'
Net revenues	$19,051,552	$22,077,873
Costs and expenses:	'	'
Cost of sales	9,955,950	13,077,447
Selling, general and administrative expense	13,623,450	14,079,188
Research and development expense	968,854	1,207,116
Depreciation and amortization expense	2,190,467	1,824,708
Impairment of assets held for sale	6,456,966	'
Total costs and expenses	33,195,687	30,188,459
Loss from operations	-14,144,135	-8,110,586
Other expense:	'	'
Change in fair value of put right	'	-2,140,727
Change in fair value of contingent consideration	'	283,000
Interest expense, net	-1,264,252	-1,076,615
Total other (loss) income, net	-1,264,252	-2,934,342
Loss before income taxes	-15,408,387	-11,044,928
Income tax (benefit) provision	-5,866,000	-3,134,000
Net Loss	-9,542,387	-7,910,928
Unrealized losson securities, net of income tax of approximately $0 and $946,000 for the three months ended March 31, 2014 and 2013, respectively	'	-1,448,645
Comprehensive loss	($9,542,387)	($9,359,573)
Net Loss per share, basic	($0.26)	($0.23)
Net Loss per share, diluted	($0.26)	($0.23)
Weighted-average common shares, basic	37,270,992	35,052,205
Weighted-average common shares, diluted	37,270,992	35,052,205

CONDENSED_CONSOLIDATED_STATEME1

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS) (Unaudited) (Parenthetical) (USD$) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Statement of Comprehensive Income [Abstract]	'	'
Unrealized losson securities, net of income tax	$0	$946,000

CONDENSED_CONSOLIDATED_STATEME2

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (USD$) (USD $)	Common Stock	Additional Paid-In Capital	Treasury Stock	Retained Earnings	Total
Beginning Balance, Amount at Dec. 31, 2013	$371,893	$119,553,760	($4,001,475)	($5,202,066)	$110,722,112
Beginning Balance, Shares at Dec. 31, 2013	37,189,351	'	'	'	'
Stock-based compensation	'	'	'	'	'
Restricted stock	'	984,705	'	'	984,705
Stock Options	'	788,122	'	'	788,122
Employee stock purchase plan	'	6,000	'	'	6,000
Issuance of stock options for services from non-employees	'	119,134	'	'	119,134
Issuance of common stock upon the exercise of options	790	293,880	'	'	294,670
Issuance of common stock upon the exercise of options, shares	79,000	'	'	'	-79,300
Issuance of common stock upon vesting of restricted stock	4,043	-4,043	'	'	'
Issuance of common stock upon vesting of restricted stock, shares	404,323	'	'	'	'
Forfeit of restricted common stock in payment of income tax liability	-1,697	1,697	-679,091	'	-679,091
Forfeit of restricted common stock in payment of income tax liability, shares	-169,766	'	'	'	'
Income tax benefit on stock based awards	'	-131,000	'	'	'
Net (loss)	'	'	'	-9,542,387	-9,542,387
Ending Balance, Amount at Mar. 31, 2014	$375,029	$121,612,255	($4,680,566)	($14,744,453)	$102,562,265
Ending Balance, Shares at Mar. 31, 2014	37,502,908	'	'	'	'

CONDENSED_CONSOLIDATED_STATEME3

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Cash flows from operating activities:	'	'
Net loss	($9,542,387)	($7,910,928)
Adjustments to reconcile net loss to net cash from operating activities:	'	'
Depreciation	149,652	143,609
Amortization of intangibles and interest accretion of contingent consideration	2,040,815	1,681,099
Amortization of deferred financing costs	313,134	114,118
Interest accretion on notes receivable	-85,523	'
Deferred income tax (benefit) provision	-6,421,000	-936,711
Impairment of long lived assets to be disposed of	6,456,966	'
Stock compensation expense	1,778,827	545,256
Expense from stock options issued in exchange for services	119,134	146,584
Change in fair value of put right	'	2,140,727
Change in fair value of contingent consideration	'	-283,000
Changes in operating assets and liabilities (net of effects of acquisitions):	'	'
Accounts receivable	-6,202,808	7,293,284
Inventory	1,836,100	4,837,327
Prepaid expenses and other assets	416,921	-560,613
Accounts payable	2,528,978	-815,034
Income taxes	188,557	-3,434,796
Accrued expenses	304,873	-449,926
Net cash from operating activities	-6,117,761	2,510,996
Cash flows from investing activities:	'	'
Acquisition of Cypress	'	-309,589
Purchase of equipment	-115,256	-135,427
Net cash used in investing activities	-115,256	-445,016
Cash flows from financing activities:	'	'
Cash acquired in connection with acquisition of Somaxon	'	2,880,837
Payments on contracts payable	'	-900,000
Payments on term loan	'	-525,000
Net proceeds from revolving credit facility	-11,812,041	'
Proceeds from issuance of convertible senior notes	65,000,000	'
Payments on financing costs	-6,201,149	-60,731
Payments on mortgages and capital leases	-34,120	-43,344
Tax benefit on stock-based awards	-131,000	-84,000
Proceeds from issuance of stock	294,670	'
Payment of employee income tax liability with surrender of employee restricted stock	-679,091	-96,705
Net cash from financing activities	46,437,269	1,171,057
Net (decrease) increase in cash and cash equivalents	40,204,252	3,237,037
Cash and cash equivalents, beginning of period	15,646,963	23,022,821
Cash and cash equivalents, end of period	55,851,215	26,259,858
Supplemental Disclosure:	'	'
Cash paid for income taxes	497,443	1,321,507
Interest paid during the period	447,845	761,007
Non-cash transaction	'	'
Acquisition of license and supply agreement - contract payable	2,500,000	500,000
Acquisition of Cypress - purchase price adjustment	'	3,250,000
Acquisition of Somaxon - Fair value of common stock	'	$23,840,424

1_Company_Overview

1. Company Overview	3 Months Ended
	Mar. 31, 2014
Organization, Consolidation and Presentation of Financial Statements [Abstract]	'
1. Company Overview	'
	Note 1.	Company Overview
	The Company is a specialty pharmaceutical company that sells, markets and develops a number of branded and generic pharmaceutical products primarily indicated for sleep, depression, bacterial infections and cough and cold conditions. The Company intends to see continued growth through the promotion of its products to physicians, healthcare practitioners and consumers, as appropriate. Since inception, the Company has engaged in a number of acquisitions and licensing arrangements to expand its product offerings. As part of its ongoing expansion strategy, the Company plans to make strategic acquisitions of products and companies, as well as develop and in-license additional products, with the aim of adding chronic, non-seasonal, specialty products to our revenue base.
	The Company’s branded products include CEDAX®, an antibiotic for middle ear infections, and a family of prescription treatments for cough and cold (ZUTRIPRO®, REZIRA®, and VITUZ®). The Company also markets SILENOR® (doxepin), which is approved for the treatment of insomnia characterized by difficulty with sleep maintenance and is not a controlled substance. The Company recently entered into an Exclusive License Agreement with Osmotica Pharmaceutical Corp. to promote its desvenlafaxine product, Khedezla™ Extended-Release Tablets, 50 and 100 mg for major depressive disorder.
	The Company also currently promotes Omeclamox-Pak® through a License and Supply Agreement with GastroEntero-Logic, LLC.  During the fourth quarter of 2014, the Company entered into a promotion agreement with Cumberland Pharmaceuticals pursuant to which Cumberland began promoting Omeclamox-Pak to gastroenterologists.
	The Company promotes its branded products through its sales and marketing organization.
	The Company sells its generic products in the areas of cough and cold, pain, vitamins, dermatology, antibiotics and gastroenterology through its wholly-owned subsidiaries, Macoven Pharmaceuticals, LLC, or Macoven, and Cypress Pharmaceuticals, Inc., or Cypress.

2_Basis_of_Presentation_and_Si

2. Basis of Presentation and Significant Accounting Policies	3 Months Ended
	Mar. 31, 2014
Accounting Policies [Abstract]	'
2. Basis of Presentation and Significant Accounting Policies	'
	Note 2.	Basis of Presentation and Summary of Significant Accounting Policies
	Interim Financial Statements
	The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted. These financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013.
	In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of these financial statements. Operating results for the three-month period ended March 31, 2014 are not necessarily indicative of the results for future periods or the full year.
	Principles of Consolidation
	The condensed consolidated financial statements include the accounts of Pernix’s wholly-owned subsidiaries Pernix Therapeutics, LLC, GTA GP, Inc., GTA LP, Inc., Gaine, Inc., Macoven, Pernix Manufacturing(PML), Respicopea, Inc., Cypress, and Pernix Sleep, Inc. (acquired March 6, 2013). Pernix Sleep isincluded only for the period subsequent to their acquisition. Transactions between and among the Company and its consolidated subsidiaries are eliminated.
	Management’s Estimates and Assumptions
	The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates. The Company reviews all significant estimates affecting the condensed consolidated financial statements on a recurring basis and records the effect of any necessary adjustments prior to their issuance. 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, depreciation, stock-based compensation, the determination of fair values of assets and liabilities in connection with business combinations, and deferred income taxes.
	Fair Value of Financial Instruments
	A financial instrument is defined as cash equivalent, evidence of an ownership interest in an entity, or a contract that creates a contractual obligation or right to deliver or receive cash or another financial instrument from another party. The Company’s financial instruments consist primarily of cash equivalents (including our Regions Trust Account which invests in short-term securities consisting of sweep accounts, money market accounts and money market mutual funds), notes receivable, an investment in equity securities (TherapeuticsMD) liquidated in June 2013, our credit facility and senior convertible notes. The carrying values of these assets approximate their fair value.
	Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy is based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value as follows:
	Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities as of the reporting date.
	Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
	Revenue Recognition
	We record all of our revenue from product sales, manufacturing sales and co-promotion agreements when realized or realizable and earned. Revenue is realized or realizable and earned when all of the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services have been performed and are billable; (3) the seller’s price to the buyer is fixed or determinable; and (4) collectability is reasonably assured. We record revenue from product sales when the customer takes ownership and assumes risk of loss (free-on-board destination). At the time of a product sale, estimates for a variety of sales deductions, such as returns on product sales, government program rebates, price adjustments and prompt pay discounts are recorded.
	For arrangements that involve the delivery of more than one element, each product, service and/or right to use assets is evaluated to determine whether it qualifies as a separate unit of accounting.  This determination is based on whether the deliverable has “stand-alone value” to the customer.  The consideration that is fixed or determinable is then allocated to each separate unit of accounting based on the relative selling price of each deliverable.  The estimated selling price of each deliverable is determined using the following hierarchy of values: (i) vendor-specific objective evidence of fair value, (ii) third-party evidence of selling price (TPE) and (iii) best estimate of selling price (BESP).  The BESP reflects the best estimate of what the selling price would be if the deliverable was regularly sold by us on a stand-alone basis.  In most cases we expect to use TPE or BESP for allocating consideration to each deliverable.  The consideration allocated to each unit of accounting is recognized as the related goods or services are delivered, limited to the consideration that is not contingent upon future deliverables. Analyzing the arrangement to identify deliverables requires the use of judgment, and each deliverable may be an obligation to deliver services, a right or license to use an asset, or another performance obligation.
	The Company recognizes revenue from milestone payments when earned, provided that (i) the milestone event is substantive in that it can only be achieved based in whole or in part on either the entity's performance or on the occurrence of a specific outcome resulting from the entity's performance and its achievability was not reasonably assured at the inception of the collaboration arrangement and (ii) the Company does not have ongoing performance obligations related to the achievement of the milestone earned and (iii) it would result in additional payments being due to the Company.  Milestone payments are considered substantive if all of the following conditions are met: the milestone payment is non-refundable; achievement of the milestone was not reasonably assured at the inception of the arrangement; substantive effort is involved to achieve the milestone; and the amount of the milestone appears reasonable in relation to the effort expended, the other milestones in the arrangement and the related risk associated with the achievement of the milestone. Any amounts received under the promotion arrangement in advance of performance, if deemed substantive, are recorded as deferred revenue and recognized as revenue as the Company completes its performance obligations.
	Manufacturing revenue is recognized when the finished product is shipped to the customer (see Note 9).
	The following table sets forth a summary of Pernix’s consolidated net revenues (in thousands) for the years ended March 31, 2014 and 2013.
			Three Months Ended
			March 31,
			2014			2013
	Gross product sales		$	40,571,782		$	38,583,976
	Sales allowances			(23,041,185	)		(18,673,243	)
	Net product sales			17,530,597			19,910,733
	Manufacturing revenue			871,215		1,184,032
	Co-promotion and other revenue			649,740			983,108
	Net revenues		$	19,051,552		$	22,077,873
	The Company’s customers consist of drug wholesalers, 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 months ended March 31, 2014 and 2013, or 10% of total accounts receivable as of March 31, 2014 and December 31, 2013.
			Gross Product Sales
			Three Months Ended
			March 31,
			2014			2013
	McKesson Drug Co.			36	%		36	%
	AmerisourceBergen Drug Corporation			35	%		12	%
	Cardinal Health, Inc			17	%		29	%
	Total			88	%		77	%
			Accounts Receivable
			March 31,			December 31,
			2014			2013
	McKesson Drug Co.			27	%		35	%
	AmerisourceBergen Drug Corporation			32	%		23	%
	Cardinal Health, Inc.			21	%		16	%
	Total			80	%		74	%
	Cost of Product Sales
	Cost of product sales is comprised of (1) costs to manufacture or acquire products sold to customers; (2) royalty, co-promotion and other revenue sharing payments under license and other agreements granting the Company rights to sell related products; (3) direct and indirect distribution costs incurred in the sale of products; and (4) the value of any write-offs or donations of obsolete or damaged inventory that cannot be sold. The Company acquired the rights to sell certain of its commercial products through license and assignment agreements with the original developers or other parties with interests in these products. These agreements obligate the Company to make payments under varying payment structures based on our net revenue from related products.
	In connection with the acquisitions of Cypress and Somaxon, the Company adjusted the predecessor cost basis, increasing inventory to fair value as required by ASC 820.  As a result, the Company recorded adjustments to increase the inventory to fair value in the amount of $8,600,000 and $695,000 at the time of acquisition for Cypress and Somaxon, respectively.  For the three months ended March 31, 2014 and 2013, approximately $1,622,000 and $3,815,000 of the increase in the basis of the inventory was amortized and included in cost of product sales, as the inventory was subsequently sold. The balance remaining of the increase in the basis of the inventory acquired is approximately $1,069,000.
	Net Revenues
	Product Sales
	The Company recognizes revenue from its product sales in accordance with its revenue recognition policy discussed above. The Company sells its products primarily to large national wholesalers, which have the right to return the products they purchase. The Company is required to estimate the amount of future returns at the time of revenue recognition. The Company recognizes product sales net of estimated allowances for product returns, government program rebates, price adjustments, and prompt pay discounts.
	Product Returns
	Consistent with industry practice, the Company offers contractual return rights that allow its customers to return short-dated or expiring products within an 18-month period, commencing from six months prior to and up to twelve months subsequent to the product expiration date. The Company’s products have a 15 to 36-month expiration period from the date of manufacture. The Company adjusts its estimate of product returns if it becomes aware of other factors that it believes could significantly impact its expected returns. These factors include its estimate of inventory levels of its products in the distribution channel, the shelf life of the product shipped, review of consumer consumption data as reported by external information management companies, actual and historical return rates for expired lots, the forecast of future sales of the product, competitive issues such as new product entrants and other known changes in sales trends. The Company estimates returns at percentages up to 10% of sales of branded and generic products and, from time to time, higher on launch return percentages for sales of new products. Returns estimates are based upon historical data and other facts and circumstances that may impact future expected returns to derive an average return percentage for our products. For the three months ended March 31, 2013, in addition to the accrual on sales, the Company recorded an additional returns allowance of approximately $148,000 and reclassedapproximately $300,000 in unrealized price adjustments due to higher than expected returns on certain generic products launched in 2011. The returns reserve may be adjusted as sales history and returns experience is accumulated on this portfolio of products. The Company reviews and adjusts these reserves quarterly.
	Government Program Rebates
	The liability for Medicaid, Medicare and other government program rebates is estimated based on historical and current rebate redemption and utilization rates contractually submitted by each state’s program administrator and assumptions regarding future government program utilization for each product sold.
	Price Adjustments
	The Company’s estimates of price adjustments, which include coupons, customer rebates, service fees, chargebacks, shelf stock adjustments, and other fees and discounts, are based on our estimated mix of sales to various third-party payors who are entitled, either contractually or statutorily, to discounts from the listed prices of our products and contracted service fees with our wholesalers. In the event that the sales mix to third-party payors or the contract fees paid to the wholesalers are different from the Company’s estimates, the Company may be required to pay higher or lower total price adjustments and/or incur chargebacks that differ from its original estimates and such difference may be significant.
	The Company’s estimates of discounts are applied pursuant to the contracts negotiated with certain customers and are primarily based on sales volumes. The Company, from time to time, offers certain promotional product-related incentives to its customers. These programs include sample cards to retail consumers, certain product incentives to pharmacy customers and other sales stocking allowances. For example, the Company has initiated coupon programs for certain of its promoted products whereby the Company offers a point-of-sale subsidy to retail consumers. The Company estimates its liabilities for these coupon programs based on redemption and utilization information provided by a third party claims processing organization. The Company accounts for the costs of these special promotional programs as price adjustments, resulting in a reduction in gross revenue.
	Any price adjustments that are not contractual or are non-recurring but that are offered at the time of sale or when a specific triggering event occurs, such as sales stocking allowances or price protection adjustments, are recorded as a reduction in revenue when the sales order is recorded or when the triggering event occurs. These allowances may be offered at varying times throughout the year or may be associated with specific events such as a new product launch, the reintroduction of a product or product price changes.
	Prompt Payment Discount
	The Company typically requires its customers to remit payments within the first 30 days for branded products and within 60 to 120 days for generics, depending on the customer and the products purchased. The Company offers wholesale distributors a prompt payment discount if they make payments within these deadlines. This discount is generally 2 to 3%. Because the Company’s wholesale customers typically take the prompt pay discount, we accrue 100% of prompt pay discounts. These discounts are based on the gross amount of each invoice at the time of our original sale to them. Earned discounts are applied at the time of payment. This allowance is recorded as a reduction of accounts receivable.
	Freight
	The Company includes freight costs for outgoing shipments in selling expenses except for the outgoing freight costs for Pernix Manufacturing which are included in cost of goods. Outgoing freight costs included in selling expenses were approximately $205,000, and $311,000 for the three months ended March 31, 2014 and 2013, respectively.
	Research and Development Costs
Research and development costs in connection with the Company’s internal programs for the development of products are expensed as incurred. Pernix either expenses research and development costs as incurred or will advance third parties a research and development fee which is amortized over the term of the related agreement. Research and development expenses were approximately $969,000 and $1,207,000 for the three months ended March 31, 2014 and 2013, respectively.
Segment Information
The Company currently markets two major product lines: a branded pharmaceuticals product line and a generic pharmaceuticals product line. These product lines qualify for reporting as a single segment in accordance with GAAP because they are similar in the nature of the products and services, production processes, types of customer, distribution methods and regulatory environment. The Company has a manufacturing subsidiary but the majority of its revenue is generated through intercompany sales and is eliminated in consolidation (see Note 9). It is deemed immaterial for segment reporting purposes.
Income Taxes
Deferred taxes are recognized for the tax consequences of “temporary differences” by applying enacted statutory tax rates applicable to future years to the difference between the financial statement carrying amounts and the tax basis of existing assets and liabilities. The effect on deferred taxes for a change in tax rates is recognized in income in the period that includes the enactment date. Pernix will recognize future tax benefits to the extent that realization of such benefits is more likely than not. Management has evaluated the potential impact in accounting for uncertainties in income taxes and has determined that it has no significant uncertain income tax positions as of March 31, 2014. Income tax returns subject to review by taxing authorities include 2010, 2011, 2012 and 2013.
Earnings per Share
Earnings per common share is presented under two formats: basic earnings per common share and diluted earnings per common share. Basic earnings per common share is computed by dividing net income attributable to common shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings per common share is computed by dividing net income by the weighted average number of common shares outstanding during the period, plus the potentially dilutive impact of common stock equivalents (i.e. stock options). Dilutive common share equivalents consist of the incremental common shares issuable upon exercise of stock options.
The following table sets forth the computation of basic and diluted net loss per share:
		Three Months Ended
		March 31,
		2014			2013
Numerator:
Net loss income		$	(9,542,387	)	$	-7,910,928
Denominator:
Weighted-average common shares, basic			37,270,992			35,052,205
Dilutive shares		─				─
Weighted-average common shares, diluted			37,270,992			35,052,205
Net loss per share, basic		$	(0.26	)	$	-0.23
Net loss per share, diluted		$	(0.26	)	$	-0.23
As of March 31, 2014, total outstanding options are 3,764,034. Options are not included above as thei effect is anti-dilutive. See Note 15, Employee Compensation and Benefits, for information regarding the Company’s outstanding options.
As discussed in Note 13, in February 2014, the Company issued $65 million aggregate principal amount of 8.00% convertible senior notes due 2019 (the “Notes”) pursuant to Rule 144A. Upon any conversion the Notes may be settled in shares of the Company’s common stock. For purposes of calculating the maximum dilutive impact, it is presumed that the Notes will be settled in common stock with the resulting potential common shares included in diluted earnings per share if the effect is more dilutive. The effect of the conversion of the Notes is excluded from the calculation of diluted loss per share because the net loss for the quarter ended March 31, 2014 causes such securities to be anti-dilutive. The potential dilutive effect of these securities is shown in the chart below:
		As of March 31,
(in thousands)		2014		2013
Conversion of the Notes		18,056		−
Investments in Marketable Securities and Other Comprehensive Income
The Company held investments in marketable equity securities as available-for-sale and the change in the market value gives rise to other comprehensive income. The components of other comprehensive loss are recorded in the condensed consolidated statements of comprehensive loss, net of the related income tax effect. The Company liquidated its investments in marketable equity securities in June 2013 as described below.
On October 5, 2011, the Company acquired 2.6 million shares of TherapeuticsMD for a purchase price of $1.0 million, or $0.38 per share, representing approximately 3.2% of TherapeuticsMD’s outstanding common stock at that time. On June 14, 2013, the Company sold all its shares of TherapeuticsMD for approximately $4,605,000 in cash proceeds, recognizing a gain on the investment of approximately $3,605,000.
Assets Held For Sale
We consider certain real property and certain other miscellaneous assets as held for sale when they meet the criteria set out in ASC 360, Property, Plant and Equipment.
As of March 31, 2014, held for saleassets were approximately $3,294,000 and held for sale liabilities were approximately 1,902,000. These assets are net of an impairment charge of approximately $6,456,000. The assets and liabilities are comprised of certain property, plant and equipment, prepaid assets, intangible assets and goodwill as well as current liabilities and a mortgage of PML as PML’s entire operation was soldon April 21, 2014. See Note 19, Subsequent Events, for further information regarding the sale.
Impairment of Long-lived Assets
The Company reviews long-lived assets, such as property and equipment, and purchased intangible assets subject to amortization for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. If any long-lived assets are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the asset exceeds its fair value. In connection with the subsequent sale of PML, the Company recorded an impairment chargeof approximately $6,456,000 against the net assets of PML as described above, for the three months ended March 31, 2014. See Note 19, Subsequent Events, for further information.
Reclassifications
Certain reclassifications have been made to prior period amounts in our condensed consolidated statements of comprehensive lossto conform to the current period presentation. These reclassifications related to the classification of cost of samples as a selling expense instead of including in cost of goods and had no effect on net income as previously reported.
Recent Accounting Pronouncements
In April 2014, the Financial Accounting Standards Board issued Accounting Standards Updated, or ASU, 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant and Equipment (Topic 360) which changes the requirements for reporting discontinued operations. ASU 2014-08 changes the threshold for disclosing discontinued operations and the related disclosure requirements. Pursuant to ASU 2014-08, only disposals representing a strategic shift, such as a major line of business, a major geographical area or majority equity investment, should be presented as a discontinued operation. If the disposal does qualify as a discontinued operation under ASU 2014-08, the entity will be required to provide expanded disclosures. The guidance will be applied prospectively to new disposals and new classifications of disposal groups held for sale after the effective date. ASU 2014-08 is effective for annual periods beginning on or after December 15, 2014 with early adoption permitted but only for disposals or classifications as held for sale which have not been reported in financial statements previously issued or available for issuance. We adopted ASU 2014-08 as of January 1, 2014. We believe our sale of PML does not qualify as discontinued operations upon our adoption of ASU 2014-08 as the Company’s manufacturing facility was not a major line of business and was not a significant component of the Company’s financial results during our period of ownership, July 1, 2012 through April 21, 2014.
There have been no other recent accounting pronouncements that have not yet been adopted by us that are expected to have a material impact on our condensed consolidated financial statements from the accounting pronouncements previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2013.

3_Fair_Value_Measurement

3. Fair Value Measurement	3 Months Ended
	Mar. 31, 2014
Fair Value Disclosures [Abstract]	'
3. Fair Value Measurement	'
	Note 3.	Fair Value Measurement
	The following tables summarize the Company’s fair value hierarchy for its financial assets and liabilities measured at fair value on a recurring and nonrecurring basis as of December 31, 2013 (in thousands). There were no such assets and liabilities as of March 31, 2014:
			31-Dec-13
			Level 1		Level 2		Level 3		Total
	Liabilities
	Contingent consideration (1)			—		—		1,330		1,330
	Total Liabilities		$	—	$	—	$	1,330	$	1,330
	(1)	Contingent consideration consists of certain holdback payments and contingent cash and equity payments with respect to our acquisition of Cypress. The fair value of the contingent consideration is included in put option and contingent consideration on the accompanying condensed consolidated balance sheets. The fair value of contingent consideration was originally estimated using probability weighted discounted cash flow models (DCF). The DCF incorporates Level 3 inputs including estimated discount rates that the Company believes market participants would consider relevant in pricing and the projected timing and amount of cash flows, which are estimated and developed, in part, based on the requirements specific to the Cypress acquisition agreement. The Company analyzes and evaluates these fair value measurements quarterly to determine whether valuation inputs continue to be relevant and appropriate or whether current period developments warrant adjustments to valuation inputs and related measurements. Any increases or decreases in discount rates would have an inverse impact on the value of related fair value measurements, while increases or decreases in expected cash flows would result in a corresponding increase or decrease in fair value measurements. The Company settled the matter of contingent consideration and paid the former shareholders of Cypress $1,330,000 in January 2014.
	The Company believes the carrying amount of its debt, contracts payable, and mortgage obligations are a reasonable estimate of their fair value due to the short remaining maturity of these items and/or their fluctuating interest rates.

4_Accounts_Receivable

4. Accounts Receivable	3 Months Ended
	Mar. 31, 2014
Accounts Receivable, Net [Abstract]	'
Accounts Receivable	'
	Note 4.	Accounts Receivable
	Accounts receivable consist of the following:
			March 31,			December 31,
			2014			2013
	Trade accounts receivable		$	32,542,615		$	25,585,112
	Less allowance for prompt pay discounts			(693,728	)		(531,722	)
	Less allowance for doubtful accounts			(86,199	)		(84,328	)
	Total trade receivables			31,762,688			24,969,062
	Other miscellaneous receivables			46,422			57,475
	Receivables from third parties – revenue sharing arrangements			75,069			654,834
	Total accounts receivable, net		$	31,884,179		$	25,681,371
	The Company typically requires customers to remit payments within the first 30 days for brand purchases or 60 to 120 days for generic purchases (depending on the customer and the products purchased). The Company offers wholesale distributors a prompt payment discount, which is typically 2%, as an incentive to remit payment within these deadlines. Accounts receivable are stated net of the estimated prompt pay discount. The Company’s management evaluates accounts receivable to determine if a provision for an allowance for doubtful accounts is appropriate. As of March 31, 2014 and December 31, 2013, the allowance for doubtful accounts was approximately $86,200 and $84,300, respectively.

5_Notes_Receivable

5. Notes Receivable	3 Months Ended
	Mar. 31, 2014
Notes Receivable	'
Notes Receivable	'
	Note 5.	Notes Receivable
	The Company received two promissory notes from Breckenridge in connection with the sale of its generic assets held by Cypress to Breckenridge on September 11, 2013. The notes mature on the first and second anniversary dates of the closing. The promissory notes, each in the amount of $4,850,000 are recorded net of a present value discount (at an assumed rate of 3.1% on the one-year note and 4.25% on the two year note) of approximately $334,000 and $419,000, in the aggregate, as of March 31, 2014 and December 31, 2013, respectively.

6_Inventories

6. Inventories	3 Months Ended
	Mar. 31, 2014
Inventory Disclosure [Abstract]	'
Inventories	'
	Note 6.	Inventory
	Inventories consist of the following:
			March 31,			December 31,
			2014			2013
	Raw materials		$	584,751		$	1,459,742
	Packaging materials			—			841,492
	Samples			673,469			731,677
	Finished goods			13,435,730			13,411,007
				14,693,950			16,443,918
	Reserve for obsolescence			(3,862,667	)		(2,633,989	)
	I  Inventory, net		$	10,831,283		$	13,809,929
	An increase in the basis of inventory related to the acquisitions of Cypress and Somaxon are included in the balances above as of March 31, 2014 and December 31, 2013. The increase included in raw materials was $221,000 as of both March 31, 2014 and December 31, 2013. The increase included in finished goods was $849,000 and $2,714,000 as of March 31, 2014 and December 31, 2013, respectively.
	The raw material inventory was all PML inventory and was included in Assets Held for Sale. See Note 9, Assets and Liabilities Held for Sale, for further discussion.

7_Prepaid_Expenses_and_Other_C

7. Prepaid Expenses and Other Current Assets	3 Months Ended
	Mar. 31, 2014
Prepaid Expenses And Other Current Assets	'
Prepaid Expenses and Other Current Assets	'
	Note 7. Prepaid Expenses and Other Current Assets
	Prepaid expenses and other current assets consist of the following:
		March 31,		December 31,
		2014		2013
	Prepaid expenses	$	3,527,222	$	4,123,087
	Deposits on inventory and prepaid royalties		445,169		235,956
	Prepaid contracts		43,000		65,733
	Capitalized financing costs		1,822,887		786,662
	Deposits		227,154		227,154
	Deferred expenses		137,224		439,700
	Total	$	6,202,656	$	5,878,292
	See Note 9, Assets and Liabilities Held for Sale, for further discussion.

8_Property_Plant_and_Equipment

8. Property, Plant, and Equipment	3 Months Ended
	Mar. 31, 2014
Property, Plant and Equipment [Abstract]	'
Property, Plant, and Equipment	'
	Note 8. Property, Plant, and Equipment
		March 31,		December 31,
		2014		2013
	Land	$	572,342	$	1,356,042
	Buildings and improvements		43,988		3,986,126
	Vehicles		—		15,000
	Equipment		771,960		2,343,601
	Furniture and fixtures		150,232		189,034
	Computer software and website		93,900		93,900
	Less accumulated depreciation		-576,369		-1,111,661
	Total	$	1,056,053	$	6,872,042
	Depreciation expense amounted to approximately $150,000 and $143,000, for the quarters ended March 31, 2014 and 2013, respectively.
	See Note 9, Assets and Liabilities Held for Sale, for further discussion.

9_Assets_and_Liabilities_Held_

9. Assets and Liabilities Held for Sale	3 Months Ended
	Mar. 31, 2014
Assets Held-for-sale, Long Lived [Abstract]	'
Assets and Liabilities Held for Sale	'
	Note 9. Assets and Liabilities Held for Sale
	In furtherance of the strategic direction being implemented by the new executive management team that was hired in February 2014, the Company shifted its strategy of manufacturing certain products of its portfolio to focus solely on the sales and marketing of the Company’s products. On March 31, 2014, the Company entered into a definitive agreement to divest its manufacturing operations, PML to Woodfield Pharmaceutical LLC. Accordingly,during the three months ended March 31, 2014, the Company adjusted PML’s net assets to fair value and, as a result, recorded an impairment charge of approximately $6,456,000.As discussed in Note 19, Subsequent Events, the Company closed on the sale of PML subsequent to the three-months ended March 31, 2014.
	The net assets and liabilities classified as Assets Held for Sale as of March 31, 2014 are reflected in the table below:
		31-Mar-14
	Inventory, net	$	1,450,919
	Prepaid expenses and other current assets		294,940
	Property and equipment, net		5,781,591
	Goodwill		915,575
	Intangible assets, net		1,308,800
	Total Held for Sale – Assets		9,751,825
	Impairment charge		(6,456,966	)
	Held for Sale – assets, net	$	3,294,859
	Accounts payable		(93,945	)
	Accrued personnel expense		(119,934	)
	Other accrued expenses		(272,420	)
	Debt – short-term		(142,036	)
	Debt – long-term		(1,273,407	)
	Held for sale – liabilities	$	1,901,742

10_Intangible_Assets_and_Goodw

10. Intangible Assets and Goodwill	3 Months Ended
	Mar. 31, 2014
Goodwill and Intangible Assets Disclosure [Abstract]	'
Intangible Assets and Goodwill	'
	Note 10.	Intangible Assets and Goodwill
	Intangible assets consist of the following:
	Cost basis:		Weighted Average Life		March 31,				December 31,
					2014				2013
	Patents		11 years		$	500,000			$	500,000
	Brand		8 years			3,887,000				3,887,000
	Product licenses		11.4 years			18,155,421				15,963,794
	Customer relationships		—			—				1,848,000
	Non-compete and supplier contract		5.3 years			5,194,571				5,194,571
	Trademark rights		Indefinite			399,805				399,805
	In-process research and development		Indefinite			25,300,000				25,300,000
	Developed technology		9.6 years			40,000,000				40,000,000
						93,436,797				93,093,170
	Accumulated amortization					(14,572,502	)			(13,070,887	)
					$	78,864,295			$	80,022,283
	Accumulated amortization:				March 31,				December 31,
					2014				2013
	Patents				$	(320,825	)		$	(305,625	)
	Brand					(1,943,508	)			(1,822,038	)
	Product licenses					(2,785,891	)			(2,383,518	)
	Customer relationships					—				(462,204	)
	Non-compete and supplier contract					(3,722,321	)			(3,609,071	)
	Trademark rights					—				—
	In-process research and development					—				—
	Developed technology					(5,799,957	)			-4,489,431
					$	(14,572,502	)		$	(13,070,887	)
	The weighted average life for our definite-lived intangible assets in total was approximately 9.6 years.
	See Note 9, Assets and Liabilities Held for Sale, for further discussion.
	License Agreement.
	On February 27, 2014, the Company entered into an exclusive license agreement with Osmotica Pharmaceutical Corporation to promote KHEDEZLA (desvenlafaxine) Extended-Release (ER) Tablets, 50 mg and 100 mg. The sales and marketing of KHEDEZLA will be supported by the Company’s team of approximately 90 sales professionals, promoting the product to high desvenlafaxine prescribing physicians. The New Drug Application (NDA) for KHEDEZLA Tablets was approved by the U.S. Food and Drug Administration pursuant to section 505(b)(2) of the Federal Food, Drug, and Cosmetic Act in July 2013. KHEDEZLA is indicated for the treatment of major depressive disorder (MDD). Pursuant to the agreement, the Company agreed to make an upfront payment for the license and Osmotica’s existing inventory of Khedezla in the amount of $4,000,000 in the aggregate with (i) $1,500,000 due upon execution of the agreement, which has been paid, (ii) $1,500,000 to be paid on or before ninety days after the effective date of February 26, 2014, and (iii) $1,000,000 to be paid on or before five months after the effective date. There are also additional milestones based on certain levels of net profits achieved. Royalty payments equivalent to 60% of net profits will be paid by the Company to Osmotica quarterly. The royalty payments reduce to 55% in the second contract year and 50% for each year thereafter.
	Estimated amortization expense related to intangible assets with definite lives for each of the five succeeding years and thereafter is as follows:
			Amount
	2014 (April – December)		$	5,739,501
	2015			7,676,977
	2016			7,676,977
	2017			5,783,808
	2018			4,746,651
	Thereafter			21,540,576
	Total		$	53,164,490
	Amortization expense is approximately $2,040,000 and $1,548,000 for the three months ended March 31, 2014 and 2013, respectively.
	Changes in the carrying amount of goodwill for the three months ended March 31, 2014 and the year ended December 31, 2013 are as follows:
			March 31,				December 31,
			2014				2013
	Beginning Balance		$	42,496,592			$	37,160,911
	Goodwill acquired – Somaxon			─			10,748,243
	Goodwill impairment – PML(see Note 9)		(915,575		)			─
	Adjustments (1)			─			-5,412,562
	Total		$	41,581,017			$	42,496,592
	_____________
	(1) Primarily reflects the impact of measurement period adjustments related to the Cypress and Somaxon acquisitions composed of a deferred tax asset on the increase in the basis of the acquired inventory, an increase in certain accrued allowances and the impact of the re-evaluation of the opening balance sheet Cypress intangible assets and inventory.

11_Accrued_Allowances

11. Accrued Allowances	3 Months Ended
	Mar. 31, 2014
Accrued Liabilities [Abstract]	'
Accrued Allowances	'
	Note 11.	Accrued Allowances
	Accrued allowances consist of the following:
			March 31,		December 31,
			2014		2013
	Accrued returns allowance		$	11,303,900	$	12,049,040
	Accrued price adjustments			23,055,190		18,300,788
	Accrued government program rebates			4,644,720		3,935,750
	Total		$	39,003,810	$	34,285,578

12_Other_Liabilities

12. Other Liabilities	3 Months Ended
	Mar. 31, 2014
Other Liabilities [Abstract]	'
Other Liabilities	'
	Note 12.	Other Liabilities
	Other liabilities consist of the following:
			March 31,		December 31,
			2014		2013
	Product license contracts (see Note 10)		$	2,500,000	$	─
	Settlement obligations (see Note 17)			11,426,000	14,115,000
	Deferred revenue			4,227,870	4,279,350
	Other			─	66,349
	Total contracts payable and other obligations		$	18,153,870	$	18,460,699
	OtOther liabilities – current		$	6,398,751	$	4,072,933
	OtOther liabilities – long term		$	11,755,119	$	14,387,766

13_Debt

13. Debt	3 Months Ended
	Mar. 31, 2014
Debt Disclosure [Abstract]	'
Debt	'
	Note 13.	Debt
	Debt consists of the following:
			March 31,		December 31,
			2014		2013
	Amounts outstanding under the Credit Facility – MidCap Funding V, LLC		$	5,047,850	$	16,859,891
	Stancorp Mortgage			─		1,449,563
	Convertible senior notes			65,000,000		─
	Total debt		$	70,047,850	$	18,309,454
	Debt – current		$	5,047,850	$	16,999,687
	Debt – long term		$	65,000,000	$	1,309,767
	See Note 9, Assets and Liabilities Held for Sale, for further discussion.
	Credit Facility – MidCap Funding V, LLC
	In connection with the purchase of all of the capital stock of Cypress, the Company, together with its subsidiaries, entered into a Credit and Guaranty Agreement, dated December 31, 2012, with MidCap Funding V, LLC, as administrative agent, a lender and as a co-bookrunner, and Business Development Corporate of America, as co-bookrunner, and additional lenders from time to time party thereto. The credit agreement provided for a term credit facility of $42 million. Subject to certain permitted liens, the obligations under this facility were secured by a first priority perfected security interest in substantially all of the assets of the Company and its subsidiaries. The proceeds from this facility were used to fund a portion of the cash consideration of the acquisition of Cypress.
	The Original Credit Agreement was subject to certain financial and nonfinancial covenants, and also contained customary representations and warranties and event of default provisions for a secured credit facility.
	The facility bore interest at a rate equal to the sum of the LIBOR rate plus an applicable margin of 6.50% per annum). The Company was required to make quarterly repayments beginning on March 31, 2013 and ending on December 31, 2017, when all remaining principal was due and payable. In addition, the Company was able to voluntarily repay outstanding amounts under the credit agreement at any time without premium or penalty. On May 8, 2013, the Company, together with its subsidiaries, entered into an Amended and Restated Credit Agreement with MidCap Financial, LLC, as Administrative Agent and as a lender, and additional lenders from time to time party thereto (the “Amended and Restated Credit Agreement”). The Amended and Restated Credit Agreement amended and restated in its entirety the Original Credit Agreement. The Amended and Restated Credit Agreement provided for a term loan of $10 million and a revolving loan commitment of $20 million. In connection with the entry into the Restated Credit Agreement, the Company prepaid approximately $12 million of the term loan that had been previously outstanding under the Original Credit Agreement. Under the Amended and Restated Credit Agreement, the Company’s borrowing base on the revolving loan commitment is equal to (A) 85% of eligible accounts, plus (B) 50% of eligible inventory, minus (C) certain reserves and/or adjustments, subject to certain conditions and limitations. Notwithstanding the foregoing, the Amended and Restated Credit Agreement provided for an advance of up to $3 million in excess of the Company’s borrowing base until June 5, 2013, at which time all excess amounts were paid. Unlike the Original Credit Agreement, the Amended and Restated Credit Agreement does not include covenants limiting capital expenditures or requiring the Company to maintain a fixed charge coverage ratio and leverage ratio, but rather contains covenants requiring the Company to maintain a minimum amount of EBITDA and net invoiced revenues. Similar to the Original Credit Agreement, the Amended and Restated Credit Agreement includes customary covenants for a secured credit facility, which include, among other things, (a) restrictions on (i) the incurrence of indebtedness, (ii) the creation of or existence of liens, (iii) the incurrence or existence of contingent obligations, (iv) making certain dividends or other distributions, (v) certain consolidations, mergers or sales of assets and (vi) purchases of assets, investments and acquisitions; and (b) requirements to deliver financial statements, reports and notices to the administrative agent and other lenders. The Amended and Restated Credit Agreement also contains customary representations and warranties and event of default provisions for a secured credit facility.
	The loans under this facility bear interest at a rate equal to the sum of the LIBOR rate plus an applicable margin of 7.50% per annum (9% at March 31, 2014). Pursuant to the Restated Credit Agreement, the Company paid certain customary fees to the administrative agent and lenders.
	Under the Amended and Restated Credit Agreement, we were required to make monthly repayments of $333,333 on the term loan beginning on November 7, 2013 and ending on May 7, 2016, when all remaining principal is due and payable. Approximately $2,300,000 of the proceeds from the sale of TherapeuticsMD stock were utilized to pay down the term loan in September 2013. The revolving loan will be paid based on our cash receipts through a lockbox arrangement. In addition, we are able to voluntarily prepay outstanding amounts under the revolving loan commitment at any time, subject to certain prepayment penalties.
	Pursuant to the terms of the Amended and Restated Credit Agreement, the closing of the sale of certain Cypress assets triggered a requirement by the Company to repay the term loan included in the Credit Agreement. At the closing, the Company paid approximately $7.7 million from the sale proceeds to MidCap in fulfillment of this requirement, and as a result, the term loan has been repaid in full. As of March 31, 2014 and December 31, 2013, the outstanding balance under the revolver was approximately $5 million and $16.9 million, respectively.
	As with the Original Credit Agreement, the obligations under the Amended and Restated Credit Agreement are secured by a first priority perfected security interest in substantially all of the assets of the Company and its subsidiaries, subject to certain permitted liens.  The May 2013 amendments described above were treated as a modification of debt under GAAP.
	On February 21, 2014, in connection with the Notes offering, the Company entered into Amendment No. 1 to the Amended and RestatedCredit Agreement (the “Amendment” and together with the Amended and Restated Credit Agreement, as amended by the Amendment, the “AmendedCredit Agreement”) with MidCap Funding IV, LLC, as Agent and as a lender (“MidCap”), and the other lenders from time to time parties thereto. Inaddition to allowing for the Note issuance, the Amendment provides for the addition of a $20 million uncommitted accordion feature to the lenders’existing $20 million revolving loan commitment. Pursuant to the Amendment, MidCap and the other lenders released their liens on certain of ourassets. The obligations under the Amended Credit Agreement are secured by a first priority security interest in the Company’s accounts, inventory,deposit accounts, securities accounts, securities entitlements, permits and cash.
	The covenants contained in the Amended Credit Agreement require the Company to maintain a minimum amount of EBITDA and net invoiced revenues unless we demonstrate minimum liquidity of at least $30 million. The Amended Credit Agreement continues to include customarycovenants for a secured credit facility, which include, among other things, (a) restrictions on (i) the incurrence of indebtedness, (ii) the creation of orexistence of liens, (iii) the incurrence or existence of contingent obligations, (iv) making certain dividends or other distributions, (v) certainconsolidations, mergers or sales of assets and (vi) purchases of assets, investments and acquisitions; and (b) requirements to deliver financialstatements, reports and notices to the Agent and the other lenders, provided that, the restrictions described in (a)(i)-(vi) above are subject to certainexceptions and permissions limited in scope and dollar value. The Amended Credit Agreement also contains customary representations and warrantiesand event of default provisions for a secured credit facility.
	In connection with the Amendment, the Company entered into an Amended and Restated Security and Pledge Agreement (the “Amended andRestated Security Agreement”) with MidCap as Agent. The Amended and Restated Security Agreement amends and restates the Security and PledgeAgreement, dated as of December 31, 2012, that we entered into with MidCap Funding V, LLC (the “Original Security Agreement”). The Amendedand Restated Security Agreement creates a security interest in favor of MidCap, for the benefit of the lenders from time to time parties to the Amendedand Restated Security Agreement, in our accounts, inventory, deposit accounts, securities accounts, securities entitlements, permits and cash assecurity for our repayment of the Company’s obligations under the Amended Credit Agreement.
	The loans under this facility bear continue to bear interest at a rate equal to the sum of the LIBOR rate (with a floor of 1.5%) plus anapplicable margin of 7.50% per annum. The expiration date of the agreement has been extended to February 21, 2017.
	Note Offering
	On February 21, 2014, Pernix Therapeutics Holdings, Inc.’s (“Pernix” or the “Company”) issued $65,000,000 aggregate principal amount 8% Convertible Senior Notes (the “Notes”) The Notes mature on February 15, 2019, unless earlier converted. The Company received net proceeds from the sale of the Notes of approximately $58.84 million, after deducting underwriting discounts and commissions and offering expenses payable by the Company. Interest is payable on the Notes on March 15, June 15, September 15 and December 15 of each year, beginning June 15, 2014.
	The Notes are governed by the terms of an indenture (the “Indenture”), between the Company and Wilmington Trust, National Association (the “Trustee”), each of which were entered into on February 21, 2014.
	The Notes are senior unsecured obligations and are: senior in right of payment to the Company’s future indebtedness that is expressly subordinated in right of payment to the Notes; equal in right of payment to the Company’s existing and future unsecured indebtedness that is not so subordinated; effectively junior to any of the Company’s secured indebtedness to the extent of the value of the assets securing such indebtedness; and structurally junior to all existing and future indebtedness (including trade payables) incurred by the Company’s subsidiaries.
	The Company may not redeem the Notes prior to the Maturity Date. However, the holders may convert their Notes at any time prior to the close of business on the business day immediately preceding February 15, 2019. Upon conversion, the Company will deliver a number of shares of the Company’s common stock equal to the conversion rate in effect on the conversion date. The initial conversion rate will be 277.7778 shares of the Company’s common stock for each $1,000 principal amount of Notes, which represents an initial conversion price of approximately $3.60 per share. Following certain corporate transactions that can occur on or prior to the stated maturity date, the Company will increase the conversion rate for a holder that elects to convert its Notes in connection with such a corporate transaction.
	If a Change of Control (as defined in the Indenture) occurs prior to the stated maturity date, holders may require the Company to purchase for cash all or any portion of their Notes at a Change of Control repurchase price equal to the Specified Percentage (as defined in the Indenture) of the principal amount of the Notes to be purchased, plus accrued and unpaid interest to, but excluding, the Change of Control repurchase date.
	The Indenture contains customary terms and covenants and events of default with respect to the Notes. If an event of default (as defined in the Indenture) occurs and is continuing, either the Trustee or the holders of at least 25% in aggregate principal amount of the outstanding Notes may declare the principal amount of, and accrued and unpaid interest on, the Notes to be due and payable immediately by notice to the Company (with a copy to the Trustee). If an event of default arising out of certain events of bankruptcy, insolvency or reorganization involving the Company (as set forth in the Indenture) occurs with respect to us, the principal amount of the Notes and accrued and unpaid interest, if any, will automatically become immediately due and payable.
	As the Company was not required to separate the conversion option in the Notes under ASC 815, Derivatives and Hedging, it considered whether the cash conversion guidance contained in ASC 470-20, Debt with Conversion and Other Options is applicable to the Notes. However, as the conversion option may not be settled in cash upon the Company’s election, the Company concluded that the cash conversion guidance is not applicable to the Notes, and the Company therefore recorded the entire proceeds of the Notes as a liability, without allocating any portion to equity.
	Because the conversion option is not bifurcated as a derivative pursuant to ASC 815 and is not separately accounted for under the cash conversion guidance, the Company further evaluated the conversion option to determine whether it is considered a beneficial conversion option at inception. The Company determined the effective conversion price at issuance to be $3.60 per share. Because the fair value of the common stock at the close of trading on the date of issuance was $3.08, no beneficial conversion feature existed at the issuance date.
	For the quarter ended March 31, 2014, total interest expense related to the outstanding principal balance of the Notes was $541,000 at the stated interest rate of 8.0% per annum. As of March 31, 2014, the Company had outstanding borrowings of $65 million related to the Notes.

14_Stockholders_Equity

14. Stockholders' Equity	3 Months Ended
	Mar. 31, 2014
Stockholders Equity	'
Stockholders' Equity	'
	Note 14.	Stockholders’ Equity
	Warrants Issued in Acquisition of Somaxon
	In connection with the acquisition of Somaxon in March of 2013, the Company assumed approximately 469,000 outstanding warrants in the acquisition of Somaxon. These warrants have exercise prices ranging from $7.70 to $90.72 and expiration dates ranging from July 2016 through August 2021.

15_Employee_Compensation_and_B

15. Employee Compensation and Benefits	3 Months Ended
	Mar. 31, 2014
Employee Benefits and Share-based Compensation [Abstract]	'
Employee Equity Compensation and Benefits	'
	Note 15.	Employee Compensation and Benefits
	The Company participates in a 401(k) plan, which covers substantially all full-time employees. The Plan is funded by employee contributions and discretionary matching contributions determined by management. At the Company’s discretion, it may match up to 100 percent of each employee’s contribution, not to exceed the first six percent of the employee’s individual salary. There is a six-month waiting period from date of hire to participate in the plan. Employees are 100 percent vested in employee and employer contributions. Contribution expense was approximately $106,000 and $137,000 for the three months ended March 31, 2014 and 2013, respectively.
	Stock Options
	The Company’s 2009 Stock Incentive Plan was approved concurrent with its merger with Golf Trust of America, Inc. (“GTA”) on March 9, 2010. The maximum number of shares that can be offered under this plan is 5,000,000. Incentives may be granted under the 2009 Plan to eligible participants in the form of (a) incentive stock options, (b) non-qualified stock options, (c) restricted stock, (d) restricted stock units, (e) stock appreciation rights and (f) other stock-based awards.
	As of March 31, 2014, approximately 30,000 options remain outstanding that were issued to current officers under former incentive plans of GTA. The remaining average contractual life of these options is approximately 11 months.
	The Company currently uses the Black-Scholes option pricing model to determine the fair value of its stock options. The determination of the fair value of stock-based payment awards on the date of grant using an option pricing model is affected by the Company’s stock price, as well as assumptions regarding a number of complex and subjective variables. These variables include the Company’s expected stock price volatility over the term of the awards, actual employee exercise behaviors, risk-free interest rate and expected dividends.
	The following table shows the weighted average of the assumptions used to value stock options on the date of grant, as follows:
			Three Months
			Ended
			March 31,
			2014
	Weighted average expected stock price volatility			74	%
	Estimated dividend yield			0	%
	Risk-free interest rate			1.8	%
	Expected life of option (in years)			6.1
	Weighted average fair value per share		$	2.6
	The Company has not paid and does not anticipate paying cash dividends; therefore, the expected dividend rate is assumed to be 0%. The expected stock price volatility for the stock options is based on historical volatility of a representative peer group of comparable companies selected using publicly available industry and market capitalization data. The risk-free rate was based on the U.S. Treasury yield curve in effect at the time of grant commensurate with the expected life assumption. The expected life of the stock options granted was estimated based on the historical exercise patterns over the option lives.
	The following table shows the option activity, described above, during the three months ended March 31, 2014:
	Option Shares		Shares				Average
							Exercise
							Price
	Outstanding at December 31, 2013(1)			1,604,500			$	4.45
	Granted			2,265,000				2.68
	Exercised			(79,300	)			3.73
	Cancelled			(26,166	)			6.18
	Expired		─
	Outstanding at March 31, 2014			3,764,034			$	3.39
	Vested and exercisable, end of period			1,015,863			$	4.49
	The intrinsic value of options exercised during the three months ended March 31, 2014 and 2013 was approximately $142,000 and $132,000, respectively.
	The weighted-average grant date fair value for options granted during the three months ended March 31, 2014 and 2013 was approximately $2.60 and $4.64, respectively.
	The following table shows the details by range of exercise price for the total options outstanding at March 31, 2014:
					Options Outstanding						Options Exercisable
	Range of Exercise Price				Shares				Remaining Contractual Life		Shares		Price
	($)								(years)				($)
		2.09 – 2.20				1,505,000				9.8		5,000	$	2.2
		3.08				50,000				9.9		─		─
		3.31 – 4.20(1)				1,831,367				8.1		801,367		3.62
		5.66				75,000				10		─		─
		6.1				124,333				7.4		87,828		6.1
		7.75 – 9.02				128,334				8.2		75,001		8.59
		10.13 – 10.14				50,000				7.1		46,667		10.14
						3,764,034				8.8		1,015,863	$	4.49
	_____________
	(1) Includes 460,000 options granted to ParaPRO, LLC on August 3, 2011, that vest over seven years, pursuant to the commercial terms of the co-promotion arrangement between the Company and ParaPRO for the marketing and sale of Natroba. For additional information, see Note 17, Commitments and Contingencies.
	As of March 31, 2014, the aggregate intrinsic value of 1,015,863 options outstanding and exercisable was approximately $1,404,000.
	As of March 31, 2014, there was approximately $4,575,000 of total unrecognized compensation cost related to unvested stock options issued to employees and directors of the Company, which is expected to be recognized ratably over a weighted-average period of 3.7 years.
	Restricted Stock
	The following table shows the Company's nonvested restricted stock outstanding at March 31, 2014:
						Weighted Average
						Grant Date
	Restricted Stock Shares		Shares			Fair Value
	Nonvested at December 31, 2013			628,854			$	5.6
	Granted			100,000				3.05
	Vested			-20,999				5.88
	Forfeited			(404,323	)			4.91
	Nonvested at March 31, 2014			303,532			$	6.95
	During the three months ended March 31, 2014, 100,000 restricted common shares were issued. Approximately $1,439,000 of total unrecognized compensation cost related to unvested restricted stock is expected to be recognized over a weighted-average period of 1.6 years.
	Employee Stock Purchase Plan
	Effective July 22, 2010, the Company adopted the 2010 Employee Stock Purchase Plan to provide substantially all employees an opportunity to purchase shares of its common stock through payroll deduction, up to 10% of eligible compensation with a $25,000 maximum deferral. Semi-annually (on May 1 and November 1), participant account balances will be used to purchase shares of stock at the lesser of 85 percent of the fair market value of shares at the beginning or end of such six-month period. The Employee Stock Purchase Plan expires on July 22, 2020. A total of 1,000,000 shares are available for purchase under this plan of which 126,027 have been issued as of March 31, 2014. Compensation expense related to the Employee Stock Purchase Plan and included in the table below for the three months ended March 31, 2014 and 2013 was approximately $6,000 and $4,000, respectively.
	Stock-Based Compensation Expense
	The following table shows the approximate amount of total stock-based compensation expense recognized for employees and non-employees:
			Three Months Ended
			March 31,
		2014				2013
Employees		$	1,698,523			$	424,91 0
Non-employees/Directors			80,304				120,346
Total		$	1,778,827			$	545,256

16_Income_Taxes

16. Income Taxes	3 Months Ended
	Mar. 31, 2014
Income Tax Disclosure [Abstract]	'
Income Taxes	'
	Note 16.	Income Taxes
	The effective income tax rate from continuing operations is different from the federal statutory rate for the three months ended March 31, 2014 and 2013 for the following reasons:
			Three Months Ended
			March 31,
			2014			2013
	Expected taxes at statutory rates			(35.0	) %		(35.0	)%
	State taxes, net of federal tax benefit			(2.0	) %		(1.4	)%
	Nondeductible expenses, including merger related expenses			0.1	%		1.6	%
	Put right expense			0	%		6.8	%
	Other			(1.2	)%	(0.4		)%
				(38.1	) %		(28.4	)%

17_Commitments_and_Contingenci

17. Commitments and Contingencies	3 Months Ended
	Mar. 31, 2014
Commitments and Contingencies Disclosure [Abstract]	'
Commitments and Contingencies	'
	Note 17.	Commitments and Contingencies
	Legal Proceedings
	Settlement with Former Shareholders of Cypress
	A Stipulation of Dismissal was filed with the United States District Court for the Southern District of Texas (Houston Division) on January 29, 2014 in connection with the settlement of all claims brought against the Company by the former shareholders (the “Plaintiff Shareholders”) of Cypress and all claims brought against the Plaintiff Shareholders by the Company in connection with the purchase of Cypress by us pursuant to the Securities Purchase Agreement by and among the Company, Cypress and the Plaintiff Shareholders (the “Purchase Agreement”). As part of the settlement, the Company agreed to pay $1,330,000 to the Plaintiff Shareholders on or before February 7, 2014, which amount was accrued at the time of the Cypress acquisition as a contingent consideration in our financial statements. This payment was made according to these terms. In exchange for this payment, both parties released all claims against the other parties, which includes the Plaintiff Shareholders waiving any rights to the put obligation of the Company included in the Purchase Agreement. Additionally, this payment repays in full all currently existing obligations by us to fund the escrow account or to pay the holdback amount under the Purchase Agreement. The settlement also modified the language relating to the milestone payment payable to the Plaintiff Shareholders pursuant to the Purchase Agreement but still reflects a one-time payment of $5,000,000, payable in cash or stock, upon the achievement of one of such milestones.
	Texas Attorney General Medicaid Investigation
	The Company reached an agreement with the Attorney General of the State of Texas to settle all claims arising from certain actions by Cypress under the Texas Medicaid Fraud Prevention Act prior to its acquisition by us in connection with a Civil Investigative Demand made on Cypress. As part of the settlement, the Company has agreed to pay $12,000,000 to the State of Texas, which amount was accrued in our financial statements at December 31, 2013 and recorded as an expense during the quarter ended December 31, 2013. An initial payment of $2,000,000 was due and payable within ten business days of the effective date of the final settlement agreement (the “Effective Date”) and was paid accordingly during the month ended March 31, 2014. Thereafter, the Company will make subsequent payments of $2,000,000 on each of the first five anniversaries of the Effective Date.
	Purchase Commitments
	Purchase obligations include fixed or minimum payments under manufacturing and supply agreements with third-party manufacturers and other providers of goods and services. Our failure to satisfy minimum sales requirements under our co-promotion agreements generally allows the counterparty to terminate the agreement and/or results in a loss of our exclusivity rights. In addition to minimum sales requirements under our co-promotion agreements, the Company has commitments under open purchase orders for inventory of approximately $5.0 million that can be cancelled without penalty.
	Stock Options Issued in Exchange for Services
	Pursuant to an agreement for support services entered into between the Company and ParaPRO on August 27, 2010 which commenced upon the launch of NATROBA on August 3, 2011, 460,000 stock options were granted to ParaPRO. The options have an exercise price of $3.65 which is the closing price of the Company’s stock as of the date of the support services agreement. The options are exercisable in seven installments in the following amounts: (i) 30,000 on August 1, 2012; (ii) 40,000 on August 1, 2013; (iii) 50,000 on August 1, 2014; (iv) 60,000 on August 1, 2015; (v) 70,000 on August 1, 2016; (vi) 90,000 on August 1, 2017; and (vii) 120,000 on August 1, 2018. The options are exercisable for a period of five years from the date each becomes exercisable and are valued at approximately $2,841,000. These options were granted in a private offering under Rule 4(2) of the Securities Act of 1933. As of March 31, 2014, there was approximately $1,171,000 of total unrecognized compensation cost related to unvested stock options, which is expected to be recognized ratably over a weighted-average period of 3.3 years.
	Leases
	The Company leases facilities space and equipment under operating lease arrangements that have terms expiring at various dates through 2016. Certain lease arrangements include renewal options and escalation clauses. In addition, various lease agreements to which the Company is a party require that we comply with certain customary covenants throughout the term of the leases. If we are unable to comply with these covenants and cannot reach a satisfactory resolution in the event of noncompliance, these agreements could terminate.
	Future minimum lease payments under non-cancelable operating leases are as follows as of March 31, 2014:
	2014 (April – December)		$	231,000
	2015			39,000
	2016			4,000
	Total		$	274,000
	Total rent expense was approximately $165,000 and $172,000 for the three months ended March 31, 2014 and 2013, respectively.
	Milestone Payments
	The Company is party to certain license agreements and acquisition agreements. Generally, these agreements require that the Company make milestone payments in cash upon the achievement of certain product development and commercialization goals and payments of royalties upon commercial sales. The amount and timing of future milestone paymentsmay vary depending on when related milestones will be attained, if at all.
	Other Revenue Sharing Agreements
	The Company has entered into certain revenue sharing arrangements that require payments based on a specified percentage of net sales or a specified cost per unit sold. For the three months ended March 31, 2014 and 2013, we recognized approximately $1,879,000 and $1,344,000, respectively, in expense included in cost of goods sold from payments pursuant to co-promotion and other revenue sharing arrangements.
	Other Commitments
	Somaxon was subject to certain contractual payment obligations pursuant to settlement agreements entered into by Somaxon, which the Company assumed. As of March 31, 2014, a $273,000 balance remained unpaid under the terms of a settlement agreement relating to the termination of a co-promotion agreement. Pursuant to the terms of this agreement, six percent of sales of Silenor are payable to the counterparty until the balance is paid in full.
	In July 2012 and January 2013, Somaxon settled two patent litigation claims with parties seeking to market generic equivalents of Silenor. As of March 31, 2014, remaining payment obligations owed by Somaxon under these settlement agreements are $1.5 million for each of the agreements, $3.0 million in the aggregate, payable in equal installments over the next seven and four years, respectively.
	Uninsured Liabilities
	The Company is exposed to various risks of losses related to torts, theft of, damage to, and destruction of assets, errors and omissions, injuries to employees, and natural disasters for which the Company maintains general liability insurance with limits and deductibles that management believes prudent in light of the exposure of the Company to loss and the cost of the insurance.
	The Company is subject to various claims and litigation arising in the ordinary course of business. In the opinion of management, the outcome of such matters will not have a material effect on the consolidated financial position or results of operations of the Company.

18_Correction_of_an_Error

18. Correction of an Error	3 Months Ended
	Mar. 31, 2014
Correction Of Error	'
Correction of an Error	'
	Note 18.	Correction of an Error
	In connection with the re-valuation of the Cypress intangible assets, the amortization and the related tax effect on these assets was retrospectively adjusted in the fourth quarter of 2013for the three months periods ending March 31, June 30 and September 30, 2013, in accordance with ASC No. 805, Business Combinations.
	Subsequent to the issuance of the Company’s 2013 consolidated financial statements, the Company identified an error in the allocation among the four quarters of 2013 of the re-measurement adjustments noted above. The correction of the above items has no impact on revenue, net loss or the Company’s cash flows for the year ended December 31, 2013.
	The following table presents the correction of these items from originally reported amounts for the year ended December 31, 2013:
			Three Months Ended
			March 31,			June 30,			September 30,			December 31,
			2013			2013			2013			2013
			(in thousands, except per share data)
			(unaudited)
	Net revenues		$	22,078		$	20,573		$	18,295		$	23,926
	Operating expenses			30,188			28,378			24,259			56,708
	(Loss) Income from operations			(8,110	)		(7,805	)		(5,964	)		(32,782	)
	Other (expense) income, net			(2,934	)		143			(2,406	)		13,466
	Income tax (benefit) provision			(3,134	)		(1,985	)		(2,547	)		(13,090	)
	Net (loss) income		$	(7,910	)	$	(5,677	)	$	(5,823	)	$	(6,226	)
	Net (loss) income per share—basic		$	(0.23	)	$	(0.15	)	$	(0.16	)	$	(0.17	)
	Net (loss) income per share - diluted		$	(0.23	)	$	(0.15	)	$	(0.16	)	$	(0.17	)
	The following table presents the originally reported amounts for the year ended December 31, 2013:
			Three Months Ended
			March 31,			June 30,			September 30,			December 31,
			2013			2013			2013			2013
			(in thousands, except per share data)
			(unaudited)
	Net revenues		$	22,078		$	20,573		$	18,295		$	23,926
	Operating expenses			30,864			29,088			24,969			54,612
	(Loss) Income from operations			(8,786	)		(8,515	)		(6,674	)		(30,686	)
	Other (expense) income, net			(2,934	)		143			(2,406	)		13,466
	Income tax (benefit) provision			(3,263	)		(2,121	)		(2,676	)		(12,696	)
	Net (loss) income		$	(8,457	)	$	(6,251	)	$	(6,404	)	$	(4,524	)
	Net (loss) income per share—basic		$	(0.24	)	$	(0.17	)	$	(0.17	)	$	(0.12	)
	Net (loss) income per share - diluted		$	(0.24	)	$	(0.17	)	$	(0.17	)	$	(0.12	)
	In connection with the re-valuation of the Cypress intangible assets, the amortization and the related tax effect on these assets has been retrospectively adjusted for the three months periods ending March 31, June 30 and September 30, 2013, in accordance with ASC No. 805, Business Combinations.  The retrospective adjustments are included in the quarterly data above.

19_Subsequent_Events

19. Subsequent Events	3 Months Ended
	Mar. 31, 2014
Subsequent Events [Abstract]	'
Subsequent Events	'
	Note 19.	Subsequent Events
	Sale of PML
	The Company closed on the sale of PML on April 21, 2014. The Company sold the entire PML operation and the mortgage was assumed by the acquirer. The Company received approximately $1.2 million in proceeds, net of the assumed mortgage and working capital liabilities at closing. Accordingly, the net assets sold are recorded, at fair value, as assets held for sale (net of an impairment charge of approximately $6.4 million) as of March 31, 2014. See Note 9, Assets Held for Sale.
	Lease Agreement
	The Company signed a lease for office space for a new corporate headquarters in Morristown, New Jersey. The lease agreement is a seven year lease, beginning on or about May 19, 2014. The total lease obligation is approximately $1,131,000 over the term of the lease.
	Stock Options
	Subsequent to March 31, 2014, the Company issued a total of 448,000 stock options at an average exercise price of $4.93 to certain employees and directors.
	Legal Settlement
	A purported class action lawsuit was filed in the Superior Court of California County of San Diego by Daniele Riganello, who, prior to the consummation of the merger between Pernix and Somaxon on March 6, 2013 (the “Merger”), was an alleged stockholder of Somaxon  (Riganello v. Somaxon, et al., No. 37-201200087821-CU-SLCTL). A second purported class action was also filed in the court by another alleged stockholder (Wasserstrom vs. Somaxon, et al., No. 37-2012-00029214-CU-SL-CTL). Both plaintiffs filed amended complaints on January 18, 2013. The lawsuits were consolidated into a single action captioned In re Somaxon Pharmaceuticals, Inc. Shareholder Litigation (Lead Case No. 37-201200087821-CU-SLCTL). The operative complaint named as defendants Somaxon, Pernix, Pernix Acquisition Corp. I, as well as each of the former members of Somaxon’s board of directors (the “Individual Defendants”).  On January 24, 2013, solely to avoid the costs, risks and uncertainties inherent in litigation, and without admitting any liability or wrongdoing, Pernix and the other named defendants in such litigation signed a memorandum of understanding (the “MOU”) to settle such litigation. The MOU resolves the claims brought in such litigation and provides a release and settlement by the purported class of Somaxon’s former stockholders of all claims against the defendants and their affiliates and agents in connection with the Merger. The parties executed a stipulation of settlement setting forth a plaintiff’s fee of $185,000 on July 3, 2013.  The court approved the final settlement on April 25, 2014, and Pernix paid the $185,000 plaintiff’s fee and $15,000 for plaintiff’s legal fees on April 29, 2014. On April 25, 2014, the court dismissed the case with prejudice.

2_Basis_of_Presentation_and_Su

2. Basis of Presentation and Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2014
Accounting Policies [Abstract]	'
Interim Financial Statements	'
	The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted. These financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013.
	In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of these financial statements. Operating results for the three-month period ended March 31, 2014 are not necessarily indicative of the results for future periods or the full year.
Principles of Consolidation	'
	The condensed consolidated financial statements include the accounts of Pernix’s wholly-owned subsidiaries Pernix Therapeutics, LLC, GTA GP, Inc., GTA LP, Inc., Gaine, Inc., Macoven, Pernix Manufacturing(PML), Respicopea, Inc., Cypress, and Pernix Sleep, Inc. (acquired March 6, 2013). Pernix Sleep isincluded only for the period subsequent to their acquisition. Transactions between and among the Company and its consolidated subsidiaries are eliminated.
Management's Estimates and Assumptions	'
	The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates. The Company reviews all significant estimates affecting the condensed consolidated financial statements on a recurring basis and records the effect of any necessary adjustments prior to their issuance. 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, depreciation, stock-based compensation, the determination of fair values of assets and liabilities in connection with business combinations, and deferred income taxes.
Fair Value of Financial Instruments	'
	A financial instrument is defined as cash equivalent, evidence of an ownership interest in an entity, or a contract that creates a contractual obligation or right to deliver or receive cash or another financial instrument from another party. The Company’s financial instruments consist primarily of cash equivalents (including our Regions Trust Account which invests in short-term securities consisting of sweep accounts, money market accounts and money market mutual funds), notes receivable, an investment in equity securities (TherapeuticsMD) liquidated in June 2013, our credit facility and senior convertible notes. The carrying values of these assets approximate their fair value.
	Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy is based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value as follows:
	Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities as of the reporting date.
	Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
Revenue Recognition	'
	We record all of our revenue from product sales, manufacturing sales and co-promotion agreements when realized or realizable and earned. Revenue is realized or realizable and earned when all of the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services have been performed and are billable; (3) the seller’s price to the buyer is fixed or determinable; and (4) collectability is reasonably assured. We record revenue from product sales when the customer takes ownership and assumes risk of loss (free-on-board destination). At the time of a product sale, estimates for a variety of sales deductions, such as returns on product sales, government program rebates, price adjustments and prompt pay discounts are recorded.
	For arrangements that involve the delivery of more than one element, each product, service and/or right to use assets is evaluated to determine whether it qualifies as a separate unit of accounting.  This determination is based on whether the deliverable has “stand-alone value” to the customer.  The consideration that is fixed or determinable is then allocated to each separate unit of accounting based on the relative selling price of each deliverable.  The estimated selling price of each deliverable is determined using the following hierarchy of values: (i) vendor-specific objective evidence of fair value, (ii) third-party evidence of selling price (TPE) and (iii) best estimate of selling price (BESP).  The BESP reflects the best estimate of what the selling price would be if the deliverable was regularly sold by us on a stand-alone basis.  In most cases we expect to use TPE or BESP for allocating consideration to each deliverable.  The consideration allocated to each unit of accounting is recognized as the related goods or services are delivered, limited to the consideration that is not contingent upon future deliverables. Analyzing the arrangement to identify deliverables requires the use of judgment, and each deliverable may be an obligation to deliver services, a right or license to use an asset, or another performance obligation.
	The Company recognizes revenue from milestone payments when earned, provided that (i) the milestone event is substantive in that it can only be achieved based in whole or in part on either the entity's performance or on the occurrence of a specific outcome resulting from the entity's performance and its achievability was not reasonably assured at the inception of the collaboration arrangement and (ii) the Company does not have ongoing performance obligations related to the achievement of the milestone earned and (iii) it would result in additional payments being due to the Company.  Milestone payments are considered substantive if all of the following conditions are met: the milestone payment is non-refundable; achievement of the milestone was not reasonably assured at the inception of the arrangement; substantive effort is involved to achieve the milestone; and the amount of the milestone appears reasonable in relation to the effort expended, the other milestones in the arrangement and the related risk associated with the achievement of the milestone. Any amounts received under the promotion arrangement in advance of performance, if deemed substantive, are recorded as deferred revenue and recognized as revenue as the Company completes its performance obligations.
	Manufacturing revenue is recognized when the finished product is shipped to the customer (see Note 9).
	The following table sets forth a summary of Pernix’s consolidated net revenues (in thousands) for the years ended March 31, 2014 and 2013.
		Three Months Ended
		March 31,
		2014			2013
	Gross product sales	$	40,571,782		$	38,583,976
	Sales allowances		(23,041,185	)		(18,673,243	)
	Net product sales		17,530,597			19,910,733
	Manufacturing revenue		871,215		1,184,032
	Co-promotion and other revenue		649,740			983,108
	Net revenues	$	19,051,552		$	22,077,873
	The Company’s customers consist of drug wholesalers, 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 months ended March 31, 2014 and 2013, or 10% of total accounts receivable as of March 31, 2014 and December 31, 2013.
		Gross Product Sales
		Three Months Ended
		March 31,
		2014			2013
	McKesson Drug Co.		36	%		36	%
	AmerisourceBergen Drug Corporation		35	%		12	%
	Cardinal Health, Inc		17	%		29	%
	Total		88	%		77	%
		Accounts Receivable
		March 31,			December 31,
		2014			2013
	McKesson Drug Co.		27	%		35	%
	AmerisourceBergen Drug Corporation		32	%		23	%
	Cardinal Health, Inc.		21	%		16	%
	Total		80	%		74	%
Cost of Product Sales	'
	Cost of product sales is comprised of (1) costs to manufacture or acquire products sold to customers; (2) royalty, co-promotion and other revenue sharing payments under license and other agreements granting the Company rights to sell related products; (3) direct and indirect distribution costs incurred in the sale of products; and (4) the value of any write-offs or donations of obsolete or damaged inventory that cannot be sold. The Company acquired the rights to sell certain of its commercial products through license and assignment agreements with the original developers or other parties with interests in these products. These agreements obligate the Company to make payments under varying payment structures based on our net revenue from related products.
	In connection with the acquisitions of Cypress and Somaxon, the Company adjusted the predecessor cost basis, increasing inventory to fair value as required by ASC 820.  As a result, the Company recorded adjustments to increase the inventory to fair value in the amount of $8,600,000 and $695,000 at the time of acquisition for Cypress and Somaxon, respectively.  For the three months ended March 31, 2014 and 2013, approximately $1,622,000 and $3,815,000 of the increase in the basis of the inventory was amortized and included in cost of product sales, as the inventory was subsequently sold. The balance remaining of the increase in the basis of the inventory acquired is approximately $1,069,000.
Product Sales	'
	The Company recognizes revenue from its product sales in accordance with its revenue recognition policy discussed above. The Company sells its products primarily to large national wholesalers, which have the right to return the products they purchase. The Company is required to estimate the amount of future returns at the time of revenue recognition. The Company recognizes product sales net of estimated allowances for product returns, government program rebates, price adjustments, and prompt pay discounts.
Product Returns	'
	Consistent with industry practice, the Company offers contractual return rights that allow its customers to return short-dated or expiring products within an 18-month period, commencing from six months prior to and up to twelve months subsequent to the product expiration date. The Company’s products have a 15 to 36-month expiration period from the date of manufacture. The Company adjusts its estimate of product returns if it becomes aware of other factors that it believes could significantly impact its expected returns. These factors include its estimate of inventory levels of its products in the distribution channel, the shelf life of the product shipped, review of consumer consumption data as reported by external information management companies, actual and historical return rates for expired lots, the forecast of future sales of the product, competitive issues such as new product entrants and other known changes in sales trends. The Company estimates returns at percentages up to 10% of sales of branded and generic products and, from time to time, higher on launch return percentages for sales of new products. Returns estimates are based upon historical data and other facts and circumstances that may impact future expected returns to derive an average return percentage for our products. For the three months ended March 31, 2013, in addition to the accrual on sales, the Company recorded an additional returns allowance of approximately $148,000 and reclassed approximately $300,000 in unrealized price adjustments due to higher than expected returns on certain generic products launched in 2011. The returns reserve may be adjusted as sales history and returns experience is accumulated on this portfolio of products. The Company reviews and adjusts these reserves quarterly.
Government Program Rebates	'
	The liability for Medicaid, Medicare and other government program rebates is estimated based on historical and current rebate redemption and utilization rates contractually submitted by each state’s program administrator and assumptions regarding future government program utilization for each product sold.
Price Adjustments	'
	The Company’s estimates of price adjustments, which include coupons, customer rebates, service fees, chargebacks, shelf stock adjustments, and other fees and discounts, are based on our estimated mix of sales to various third-party payors who are entitled, either contractually or statutorily, to discounts from the listed prices of our products and contracted service fees with our wholesalers. In the event that the sales mix to third-party payors or the contract fees paid to the wholesalers are different from the Company’s estimates, the Company may be required to pay higher or lower total price adjustments and/or incur chargebacks that differ from its original estimates and such difference may be significant.
	The Company’s estimates of discounts are applied pursuant to the contracts negotiated with certain customers and are primarily based on sales volumes. The Company, from time to time, offers certain promotional product-related incentives to its customers. These programs include sample cards to retail consumers, certain product incentives to pharmacy customers and other sales stocking allowances. For example, the Company has initiated coupon programs for certain of its promoted products whereby the Company offers a point-of-sale subsidy to retail consumers. The Company estimates its liabilities for these coupon programs based on redemption and utilization information provided by a third party claims processing organization. The Company accounts for the costs of these special promotional programs as price adjustments, resulting in a reduction in gross revenue.
	Any price adjustments that are not contractual or are non-recurring but that are offered at the time of sale or when a specific triggering event occurs, such as sales stocking allowances or price protection adjustments, are recorded as a reduction in revenue when the sales order is recorded or when the triggering event occurs. These allowances may be offered at varying times throughout the year or may be associated with specific events such as a new product launch, the reintroduction of a product or product price changes.
Prompt Payment Discount	'
	The Company typically requires its customers to remit payments within the first 30 days for branded products and within 60 to 120 days for generics, depending on the customer and the products purchased. The Company offers wholesale distributors a prompt payment discount if they make payments within these deadlines. This discount is generally 2 to 3%. Because the Company’s wholesale customers typically take the prompt pay discount, we accrue 100% of prompt pay discounts. These discounts are based on the gross amount of each invoice at the time of our original sale to them. Earned discounts are applied at the time of payment. This allowance is recorded as a reduction of accounts receivable.
Freight	'
	The Company includes freight costs for outgoing shipments in selling expenses except for the outgoing freight costs for Pernix Manufacturing which are included in cost of goods. Outgoing freight costs included in selling expenses were approximately $205,000, and $311,000 for the three months ended March 31, 2014 and 2013, respectively.
Research and Development Costs	'
	Research and development costs in connection with the Company’s internal programs for the development of products are expensed as incurred. Pernix either expenses research and development costs as incurred or will advance third parties a research and development fee which is amortized over the term of the related agreement. Research and development expenses were approximately $969,000 and $1,207,000 for the three months ended March 31, 2014 and 2013, respectively.
Segment Information	'
	The Company currently markets two major product lines: a branded pharmaceuticals product line and a generic pharmaceuticals product line. These product lines qualify for reporting as a single segment in accordance with GAAP because they are similar in the nature of the products and services, production processes, types of customer, distribution methods and regulatory environment. The Company has a manufacturing subsidiary but the majority of its revenue is generated through intercompany sales and is eliminated in consolidation (see Note 9). It is deemed immaterial for segment reporting purposes.
Income Taxes	'
	Deferred taxes are recognized for the tax consequences of “temporary differences” by applying enacted statutory tax rates applicable to future years to the difference between the financial statement carrying amounts and the tax basis of existing assets and liabilities. The effect on deferred taxes for a change in tax rates is recognized in income in the period that includes the enactment date. Pernix will recognize future tax benefits to the extent that realization of such benefits is more likely than not. Management has evaluated the potential impact in accounting for uncertainties in income taxes and has determined that it has no significant uncertain income tax positions as of March 31, 2014. Income tax returns subject to review by taxing authorities include 2010, 2011, 2012 and 2013.
Earnings per Share	'
	Earnings per common share is presented under two formats: basic earnings per common share and diluted earnings per common share. Basic earnings per common share is computed by dividing net income attributable to common shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings per common share is computed by dividing net income by the weighted average number of common shares outstanding during the period, plus the potentially dilutive impact of common stock equivalents (i.e. stock options). Dilutive common share equivalents consist of the incremental common shares issuable upon exercise of stock options.
	The following table sets forth the computation of basic and diluted net loss per share:
		Three Months Ended
		March 31,
		2014			2013
	Numerator:
	Net loss income	$	(9,542,387	)	$	-7,910,928
	Denominator:
	Weighted-average common shares, basic		37,270,992			35,052,205
	Dilutive shares	─				─
	Weighted-average common shares, diluted		37,270,992			35,052,205
	Net loss per share, basic	$	(0.26	)	$	-0.23
	Net loss per share, diluted	$	(0.26	)	$	-0.23
	As of March 31, 2014, total outstanding options are 3,764,034. Options are not included above as thei effect is anti-dilutive. See Note 15, Employee Compensation and Benefits, for information regarding the Company’s outstanding options.
	As discussed in Note 13, in February 2014, the Company issued $65 million aggregate principal amount of 8.00% convertible senior notes due 2019 (the “Notes”) pursuant to Rule 144A. Upon any conversion the Notes may be settled in shares of the Company’s common stock. For purposes of calculating the maximum dilutive impact, it is presumed that the Notes will be settled in common stock with the resulting potential common shares included in diluted earnings per share if the effect is more dilutive. The effect of the conversion of the Notes is excluded from the calculation of diluted loss per share because the net loss for the quarter ended March 31, 2014 causes such securities to be anti-dilutive. The potential dilutive effect of these securities is shown in the chart below:
		As of March 31,
	(in thousands)	2014		2013
	Conversion of the Notes	18,056		−
Investments in Marketable Securities and Other Comprehensive Income	'
	The Company held investments in marketable equity securities as available-for-sale and the change in the market value gives rise to other comprehensive income. The components of other comprehensive loss are recorded in the condensed consolidated statements of comprehensive loss, net of the related income tax effect. The Company liquidated its investments in marketable equity securities in June 2013 as described below.
	On October 5, 2011, the Company acquired 2.6 million shares of TherapeuticsMD for a purchase price of $1.0 million, or $0.38 per share, representing approximately 3.2% of TherapeuticsMD’s outstanding common stock at that time. On June 14, 2013, the Company sold all its shares of TherapeuticsMD for approximately $4,605,000 in cash proceeds, recognizing a gain on the investment of approximately $3,605,000.
Assets Held For Sale	'
	We consider certain real property and certain other miscellaneous assets as held for sale when they meet the criteria set out in ASC 360, Property, Plant and Equipment.
	As of March 31, 2014, held for saleassets were approximately $3,294,000 and held for sale liabilities were approximately 1,902,000. These assets are net of an impairment charge of approximately $6,456,000. The assets and liabilities are comprised of certain property, plant and equipment, prepaid assets, intangible assets and goodwill as well as current liabilities and a mortgage of PML as PML’s entire operation was soldon April 21, 2014. See Note 19, Subsequent Events, for further information regarding the sale.
Impairment of Long-lived Assets	'
	The Company reviews long-lived assets, such as property and equipment, and purchased intangible assets subject to amortization for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. If any long-lived assets are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the asset exceeds its fair value. In connection with the subsequent sale of PML, the Company recorded an impairment chargeof approximately $6,456,000 against the net assets of PML as described above, for the three months ended March 31, 2014. See Note 19, Subsequent Events, for further information.
Reclassifications	'
	Certain reclassifications have been made to prior period amounts in our condensed consolidated statements of comprehensive lossto conform to the current period presentation. These reclassifications related to the classification of cost of samples as a selling expense instead of including in cost of goods and had no effect on net income as previously reported.
Recent Accounting Pronouncements	'
	In April 2014, the Financial Accounting Standards Board issued Accounting Standards Updated, or ASU, 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant and Equipment (Topic 360) which changes the requirements for reporting discontinued operations. ASU 2014-08 changes the threshold for disclosing discontinued operations and the related disclosure requirements. Pursuant to ASU 2014-08, only disposals representing a strategic shift, such as a major line of business, a major geographical area or majority equity investment, should be presented as a discontinued operation. If the disposal does qualify as a discontinued operation under ASU 2014-08, the entity will be required to provide expanded disclosures. The guidance will be applied prospectively to new disposals and new classifications of disposal groups held for sale after the effective date. ASU 2014-08 is effective for annual periods beginning on or after December 15, 2014 with early adoption permitted but only for disposals or classifications as held for sale which have not been reported in financial statements previously issued or available for issuance. We adopted ASU 2014-08 as of January 1, 2014. We believe our sale of PML does not qualify as discontinued operations upon our adoption of ASU 2014-08 as the Company’s manufacturing facility was not a major line of business and was not a significant component of the Company’s financial results during our period of ownership, July 1, 2012 through April 21, 2014.
	There have been no other recent accounting pronouncements that have not yet been adopted by us that are expected to have a material impact on our condensed consolidated financial statements from the accounting pronouncements previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2013.

2_Basis_of_Presentation_and_Su1

2. Basis of Presentation and Summary of Significant Accounting Policies (Tables)	3 Months Ended
	Mar. 31, 2014
Accounting Policies [Abstract]	'
Summary of Pernix's consolidated net revenues	'
	The following table sets forth a summary of Pernix’s consolidated net revenues (in thousands) for the years ended March 31, 2014 and 2013.
		Three Months Ended
		March 31,
		2014			2013
	Gross product sales	$	40,571,782		$	38,583,976
	Sales allowances		(23,041,185	)		(18,673,243	)
	Net product sales		17,530,597			19,910,733
	Manufacturing revenue		871,215		1,184,032
	Co-promotion and other revenue		649,740			983,108
	Net revenues	$	19,051,552		$	22,077,873
Major Customer's revenue	'
	The following tables list the Company’s customers that individually comprised greater than 10% of total gross product sales for the three months ended March 31, 2014 and 2013, or 10% of total accounts receivable as of March 31, 2014 and December 31, 2013.
		Gross Product Sales
		Three Months Ended
		March 31,
		2014			2013
	McKesson Drug Co.		36	%		36	%
	AmerisourceBergen Drug Corporation		35	%		12	%
	Cardinal Health, Inc		17	%		29	%
	Total		88	%		77	%
		Accounts Receivable
		March 31,			December 31,
		2014			2013
	McKesson Drug Co.		27	%		35	%
	AmerisourceBergen Drug Corporation		32	%		23	%
	Cardinal Health, Inc.		21	%		16	%
	Total		80	%		74	%
Earnings per Share	'
	The following table sets forth the computation of basic and diluted net loss per share:
		Three Months Ended
		March 31,
		2014			2013
	Numerator:
	Net loss income	$	(9,542,387	)	$	-7,910,928
	Denominator:
	Weighted-average common shares, basic		37,270,992			35,052,205
	Dilutive shares	─				─
	Weighted-average common shares, diluted		37,270,992			35,052,205
	Net loss per share, basic	$	(0.26	)	$	-0.23
	Net loss per share, diluted	$	(0.26	)	$	-0.23
Conversion of notes	'
	The effect of the conversion of the Notes is excluded from the calculation of diluted loss per share because the net loss for the quarter ended March 31, 2014 causes such securities to be anti-dilutive. The potential dilutive effect of these securities is shown in the chart below:
		As of March 31,
	(in thousands)	2014		2013
	Conversion of the Notes	18,056		−

3_Fair_Value_Measurement_Table

3. Fair Value Measurement (Tables)	3 Months Ended
	Mar. 31, 2014
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 following tables summarize the Company’s fair value hierarchy for its financial assets and liabilities measured at fair value on a recurring and nonrecurring basis as of December 31, 2013 (in thousands). There were no such assets and liabilities as of March 31, 2014:
		31-Dec-13
		Level 1		Level 2		Level 3		Total
	Liabilities
	Contingent consideration (1)		—		—		1,330		1,330
	Total Liabilities	$	—	$	—	$	1,330	$	1,330

4_Accounts_Receivables_Tables

4. Accounts Receivables (Tables)	3 Months Ended
	Mar. 31, 2014
Receivables [Abstract]	'
Accounts receivable	'
	Accounts receivable consist of the following:
		March 31,			December 31,
		2014			2013
	Trade accounts receivable	$	32,542,615		$	25,585,112
	Less allowance for prompt pay discounts		(693,728	)		(531,722	)
	Less allowance for doubtful accounts		(86,199	)		(84,328	)
	Total trade receivables		31,762,688			24,969,062
	Other miscellaneous receivables		46,422			57,475
	Receivables from third parties – revenue sharing arrangements		75,069			654,834
	Total accounts receivable, net	$	31,884,179		$	25,681,371

6_Inventories_Tables

6. Inventories (Tables)	3 Months Ended
	Mar. 31, 2014
Inventory Disclosure [Abstract]	'
Schedule of Inventory	'
	Inventories consist of the following:
		March 31,			December 31,
		2014			2013
	Raw materials	$	584,751		$	1,459,742
	Packaging materials		—			841,492
	Samples		673,469			731,677
	Finished goods		13,435,730			13,411,007
			14,693,950			16,443,918
	Reserve for obsolescence		(3,862,667	)		(2,633,989	)
	Inventory, net	$	10,831,283		$	13,809,929

7_Prepaid_Expenses_and_Other_C1

7. Prepaid Expenses and Other Current Assets (Tables)	3 Months Ended
	Mar. 31, 2014
Prepaid Expenses And Other Current Assets Tables	'
Prepaid Expenses and Other Current Assets	'
	Prepaid expenses and other current assets consist of the following:
		March 31,		December 31,
		2014		2013
	Prepaid expenses	$	3,527,222	$	4,123,087
	Deposits on inventory and prepaid royalties		445,169		235,956
	Prepaid contracts		43,000		65,733
	Capitalized financing costs		1,822,887		786,662
	Deposits		227,154		227,154
	Deferred expenses		137,224		439,700
	Total	$	6,202,656	$	5,878,292

8_Property_Plant_and_Equipment1

8. Property, Plant, and Equipment (Tables)	3 Months Ended
	Mar. 31, 2014
Property, Plant and Equipment [Abstract]	'
Schedule of Property, Plant, and Equipment	'
		March 31,		December 31,
		2014		2013
	Land	$	572,342	$	1,356,042
	Buildings and improvements		43,988		3,986,126
	Vehicles		—		15,000
	Equipment		771,960		2,343,601
	Furniture and fixtures		150,232		189,034
	Computer software and website		93,900		93,900
	Less accumulated depreciation		-576,369		-1,111,661
	Total	$	1,056,053	$	6,872,042

9_Assets_and_Liabilities_Held_1

9. Assets and Liabilities Held for Sale (Tables)	3 Months Ended
	Mar. 31, 2014
Assets Held-for-sale, Long Lived [Abstract]	'
Net assets and liabilities classified as Assets Held for Sale	'
	The net assets and liabilities classified as Assets Held for Sale as of March 31, 2014 are reflected in the table below:
		31-Mar-14
	Inventory, net	$	1,450,919
	Prepaid expenses and other current assets		294,940
	Property and equipment, net		5,781,591
	Goodwill		915,575
	Intangible assets, net		1,308,800
	Total Held for Sale – Assets		9,751,825
	Impairment charge		(6,456,966	)
	Held for Sale – assets, net	$	3,294,859
	Accounts payable		(93,945	)
	Accrued personnel expense		(119,934	)
	Other accrued expenses		(272,420	)
	Debt – short-term		(142,036	)
	Debt – long-term		(1,273,407	)
	Held for sale – liabilities	$	1,901,742

10_Intangible_Assets_and_Goodw1

10. Intangible Assets and Goodwill (Tables)	3 Months Ended
	Mar. 31, 2014
Goodwill and Intangible Assets Disclosure [Abstract]	'
Intangible assets	'
	Intangible assets consist of the following:
	Cost basis:	Weighted Average Life		March 31,				December 31,
				2014				2013
	Patents	11 years		$	500,000			$	500,000
	Brand	8 years			3,887,000				3,887,000
	Product licenses	11.4 years			18,155,421				15,963,794
	Customer relationships	—			—				1,848,000
	Non-compete and supplier contract	5.3 years			5,194,571				5,194,571
	Trademark rights	Indefinite			399,805				399,805
	In-process research and development	Indefinite			25,300,000				25,300,000
	Developed technology	9.6 years			40,000,000				40,000,000
					93,436,797				93,093,170
	Accumulated amortization				(14,572,502	)			(13,070,887	)
				$	78,864,295			$	80,022,283
	Accumulated amortization:			March 31,				December 31,
				2014				2013
	Patents			$	(320,825	)		$	(305,625	)
	Brand				(1,943,508	)			(1,822,038	)
	Product licenses				(2,785,891	)			(2,383,518	)
	Customer relationships				—				(462,204	)
	Non-compete and supplier contract				(3,722,321	)			(3,609,071	)
	Trademark rights				—				—
	In-process research and development				—				—
	Developed technology				(5,799,957	)			-4,489,431
				$	(14,572,502	)		$	(13,070,887	)
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:
		Amount
	2014 (April – December)	$	5,739,501
	2015		7,676,977
	2016		7,676,977
	2017		5,783,808
	2018		4,746,651
	Thereafter		21,540,576
	Total	$	53,164,490
Changes in the carrying amount of goodwill	'
	Changes in the carrying amount of goodwill for the three months ended March 31, 2014 and the year ended December 31, 2013 are as follows:
		March 31,				December 31,
		2014				2013
	Beginning Balance	$	42,496,592			$	37,160,911
	Goodwill acquired – Somaxon		─			10,748,243
	Goodwill impairment – PML(see Note 9)	(915,575		)			─
	Adjustments (1)		─			-5,412,562
	Total	$	41,581,017			$	42,496,592

11_Accrued_Allowances_Tables

11. Accrued Allowances (Tables)	3 Months Ended
	Mar. 31, 2014
Accrued Liabilities [Abstract]	'
Accrued allowances	'
	Accrued allowances consist of the following:
		March 31,		December 31,
		2014		2013
	Accrued returns allowance	$	11,303,900	$	12,049,040
	Accrued price adjustments		23,055,190		18,300,788
	Accrued government program rebates		4,644,720		3,935,750
	Total	$	39,003,810	$	34,285,578

12_Other_Liabilities_Tables

12. Other Liabilities (Tables)	3 Months Ended
	Mar. 31, 2014
Other Liabilities [Abstract]	'
Other Liabilities	'
	Other liabilities consist of the following:
		March 31,		December 31,
		2014		2013
	Product license contracts (see Note 10)	$	2,500,000	$	─
	Settlement obligations (see Note 17)		11,426,000	14,115,000
	Deferred revenue		4,227,870	4,279,350
	Other		─	66,349
	Total contracts payable and other obligations	$	18,153,870	$	18,460,699
	OtOther liabilities – current	$	6,398,751	$	4,072,933
	OtOther liabilities – long term	$	11,755,119	$	14,387,766

13_Debt_Tables

13. Debt (Tables)	3 Months Ended
	Mar. 31, 2014
Debt Disclosure [Abstract]	'
Debt consists	'
	Debt consists of the following:
		March 31,		December 31,
		2014		2013
	Amounts outstanding under the Credit Facility – MidCap Funding V, LLC	$	5,047,850	$	16,859,891
	Stancorp Mortgage		─		1,449,563
	Convertible senior notes		65,000,000		─
	Total debt	$	70,047,850	$	18,309,454
	Debt – current	$	5,047,850	$	16,999,687
	Debt – long term	$	65,000,000	$	1,309,767

15_Employee_Compensation_and_B1

15. Employee Compensation and Benefits (Tables)	3 Months Ended
	Mar. 31, 2014
Employee Benefits and Share-based Compensation [Abstract]	'
Weighted average assumptions used to value stock options	'
	The following table shows the weighted average of the assumptions used to value stock options on the date of grant, as follows:
			Three Months
			Ended
			March 31,
			2014
	Weighted average expected stock price volatility			74	%
	Estimated dividend yield			0	%
	Risk-free interest rate			1.8	%
	Expected life of option (in years)			6.1
	Weighted average fair value per share		$	2.6
Stock Option Activity	'
	The following table shows the option activity, described above, during the three months ended March 31, 2014:
	Option Shares		Shares				Average
							Exercise
							Price
	Outstanding at December 31, 2013(1)			1,604,500			$	4.45
	Granted			2,265,000				2.68
	Exercised			(79,300	)			3.73
	Cancelled			(26,166	)			6.18
	Expired		─
	Outstanding at March 31, 2014			3,764,034			$	3.39
	Vested and exercisable, end of period			1,015,863			$	4.49
Range of exercise price	'
	The following table shows the details by range of exercise price for the total options outstanding at March 31, 2014:
					Options Outstanding						Options Exercisable
	Range of Exercise Price				Shares				Remaining Contractual Life		Shares		Price
	($)								(years)				($)
		2.09 – 2.20				1,505,000				9.8		5,000	$	2.2
		3.08				50,000				9.9		─		─
		3.31 – 4.20(1)				1,831,367				8.1		801,367		3.62
		5.66				75,000				10		─		─
		6.1				124,333				7.4		87,828		6.1
		7.75 – 9.02				128,334				8.2		75,001		8.59
		10.13 – 10.14				50,000				7.1		46,667		10.14
						3,764,034				8.8		1,015,863	$	4.49
Restricted stock	'
	The following table shows the Company's nonvested restricted stock outstanding at March 31, 2014:
						Weighted Average
						Grant Date
	Restricted Stock Shares		Shares			Fair Value
	Nonvested at December 31, 2013			628,854			$	5.6
	Granted		100,000					3.05
	Vested			-20,999				5.88
	Forfeited			(404,323	)			4.91
	Nonvested at March 31, 2014			303,532			$	6.95
Stock-Based Compensation Expense	'
	The following table shows the approximate amount of total stock-based compensation expense recognized for employees and non-employees:
			Three Months Ended
			March 31,
			2014				2013
	Employees		$	1,698,523			$	424,910
	Non-employees/Directors			80,304				120,346
	Total		$	1,778,827			$	545,256

16_Income_Taxes_Tables

16. Income Taxes (Tables)	3 Months Ended
	Mar. 31, 2014
Income Tax Disclosure [Abstract]	'
Effective on income tax rate from continuing operations	'
	The effective income tax rate from continuing operations is different from the federal statutory rate for the three months ended March 31, 2014 and 2013 for the following reasons:
		Three Months Ended
		March 31,
		2014			2013
	Expected taxes at statutory rates		(35.0	) %		(35.0	)%
	State taxes, net of federal tax benefit		(2.0	) %		(1.4	)%
	Nondeductible expenses, including merger related expenses		0.1	%		1.6	%
	Put right expense		0	%		6.8	%
	Other		(1.2	)%	(0.4		)%
			(38.1	) %		(28.4	)%

17_Commitments_and_Contingenci1

17. Commitments and Contingencies (Tables)	3 Months Ended
	Mar. 31, 2014
Commitments and Contingencies Disclosure [Abstract]	'
Future minimum lease payments under non-cancelable operating leases	'
	Future minimum lease payments under non-cancelable operating leases are as follows as of March 31, 2014:
	2014 (April – December)	$	231,000
	2015		39,000
	2016		4,000
	Total	$	274,000

18_Correction_of_an_Error_Tabl

18. Correction of an Error (Tables)	3 Months Ended
	Mar. 31, 2014
Correction Of Error Tables	'
Schedule of correction of error	'
	The following table presents the correction of these items from originally reported amounts for the year ended December 31, 2013:
		Three Months Ended
		March 31,			June 30,			September 30,			December 31,
		2013			2013			2013			2013
		(in thousands, except per share data)
		(unaudited)
	Net revenues	$	22,078		$	20,573		$	18,295		$	23,926
	Operating expenses		30,188			28,378			24,259			56,708
	(Loss) Income from operations		(8,110	)		(7,805	)		(5,964	)		(32,782	)
	Other (expense) income, net		(2,934	)		143			(2,406	)		13,466
	Income tax (benefit) provision		(3,134	)		(1,985	)		(2,547	)		(13,090	)
	Net (loss) income	$	(7,910	)	$	(5,677	)	$	(5,823	)	$	(6,226	)
	Net (loss) income per share—basic	$	(0.23	)	$	(0.15	)	$	(0.16	)	$	(0.17	)
	Net (loss) income per share - diluted	$	(0.23	)	$	(0.15	)	$	(0.16	)	$	(0.17	)
	The following table presents the originally reported amounts for the year ended December 31, 2013:
		Three Months Ended
		March 31,			June 30,			September 30,			December 31,
		2013			2013			2013			2013
		(in thousands, except per share data)
		(unaudited)
	Net revenues	$	22,078		$	20,573		$	18,295		$	23,926
	Operating expenses		30,864			29,088			24,969			54,612
	(Loss) Income from operations		(8,786	)		(8,515	)		(6,674	)		(30,686	)
	Other (expense) income, net		(2,934	)		143			(2,406	)		13,466
	Income tax (benefit) provision		(3,263	)		(2,121	)		(2,676	)		(12,696	)
	Net (loss) income	$	(8,457	)	$	(6,251	)	$	(6,404	)	$	(4,524	)
	Net (loss) income per share—basic	$	(0.24	)	$	(0.17	)	$	(0.17	)	$	(0.12	)
	Net (loss) income per share - diluted	$	(0.24	)	$	(0.17	)	$	(0.17	)	$	(0.12	)

2_Basis_of_Presentation_and_Su2

2. Basis of Presentation and Summary of Significant Accounting Policies (Details) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Components of company's net revenue	'	'
Gross product sales	$40,571,782	$38,583,976
Sales allowances	-23,041,185	-18,673,243
Net product sales	17,530,597	19,910,733
Manufacturing revenue	871,215	1,184,032
Co-promotion and royalty revenue	649,740	983,108
Net revenues	$19,051,552	$22,077,873

2_Basis_of_Presentation_and_Su3

2. Basis of Presentation and Summary of Significant Accounting Policies (Details 1)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2013
Company's customers that individually comprised greater than 10% of total gross product sales	'	'	'
Percentage of gross product sales	88.00%	77.00%	'
Percentage of accounts receivable	80.00%	'	74.00%
Cardinal Health Inc	'	'	'
Company's customers that individually comprised greater than 10% of total gross product sales	'	'	'
Percentage of gross product sales	17.00%	29.00%	'
Percentage of accounts receivable	21.00%	'	16.00%
McKesson Corporation	'	'	'
Company's customers that individually comprised greater than 10% of total gross product sales	'	'	'
Percentage of gross product sales	36.00%	36.00%	'
Percentage of accounts receivable	27.00%	'	35.00%
Amerisource Bergen Drug Corporation	'	'	'
Company's customers that individually comprised greater than 10% of total gross product sales	'	'	'
Percentage of gross product sales	35.00%	12.00%	'
Percentage of accounts receivable	32.00%	'	23.00%

2_Basis_of_Presentation_and_Su4

2. Basis of Presentation and Summary of Significant Accounting Policies (Details 2) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Numerator:	'	'
Net Loss	($9,542,387)	($7,910,928)
Denominator:	'	'
Weighted-average common shares, basic	37,270,992	35,052,205
Dilutive shares	'	'
Weighted-average common shares, diluted	37,270,992	35,052,205
Net loss income per share, basic	($0.26)	($0.23)
Net loss income per share, diluted	($0.26)	($0.23)

2_Basis_of_Presentation_and_Su5

2. Basis of Presentation and Summary of Significant Accounting Policies (Details 3) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Accounting Policies [Abstract]	'	'
Conversion of the Notes	$18,056	'

2_Basis_of_Presentation_and_Su6

2. Basis of Presentation and Summary of Significant Accounting Policies (Details Narrative) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Feb. 28, 2014	Dec. 31, 2013
Accounting Policies [Abstract]	'	'	'	'
Amortization of the increase in the basis of the inventory	$1,622,000	$3,815,000	'	'
Remaining balance of the increase in the basis of the inventory	1,069,000	'	'	'
Increase to Returns Allowance	'	148,000	'	'
Unrealized price adjustments in returns allowance reclassed	'	300,000	'	'
Number of anti dilutive options, Outstanding	3,764,034	'	'	'
Impairment of long lived asset to be disposed of	-6,456,966	'	'	'
Outgoing Freight Cost	205,000	311,000	'	'
Research and development expenses	969,000	1,207,000	'	'
Assets held for sale	3,294,859	'	'	'
Liabilities of Assets Held-for-sale	1,901,742	'	'	'
Convertible senior notes	'	'	$65,000,000	'

3_Fair_Value_Measurement_Detai

3. Fair Value Measurement (Details) (USD $)	Dec. 31, 2013
Liabilities	'
Contingent consideration(1)	$1,330
Total Liabilities	1,330
Level 1 Member	'
Liabilities	'
Contingent consideration(1)	'
Total Liabilities	'
Level 2 Member	'
Liabilities	'
Contingent consideration(1)	'
Total Liabilities	'
Level 3 Member	'
Liabilities	'
Contingent consideration(1)	1,330
Total Liabilities	$1,330

3_Fair_Value_Measurement_Detai1

3. Fair Value Measurement (Details Narrative) (USD $)	Jan. 31, 2014
Fair Value Disclosures [Abstract]	'
Contingent Consideration	$1,330,000

4_Accounts_Receivable_Details

4. Accounts Receivable (Details) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Accounts receivable consist of the following	'	'
Trade accounts receivable	$32,542,615	$25,585,112
Less allowance for prompt pay discounts	-693,728	-531,722
Less allowance for doubtful accounts	-86,199	-84,328
Total trade receivables	31,762,688	24,969,062
Other miscellaneous receivables	46,422	57,475
Receivables from third parties - revenue sharing arrangements	75,069	654,834
Total accounts receivable, net	$31,884,179	$25,681,371

4_Accounts_Receivable_Details_

4. Accounts Receivable (Details Narrative) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Accounts Receivable, Net [Abstract]	'	'
Allowance for doubtful accounts	$86,200	$84,300

5_Notes_Receivable_Details_Nar

5. Notes Receivable (Details Narrative) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Promissory note face value	$4,850,000	'
Assumed rate on note	8.00%	'
Unamortized discount on the note receivable	$334,000	$419,000
One year note	'	'
Assumed rate on note	3.10%	'
Two year note	'	'
Assumed rate on note	4.25%	'

6_Inventories_Details

6. Inventories (Details) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Inventory Disclosure [Abstract]	'	'
Raw materials	$584,751	$1,459,742
Packaging materials	'	841,492
Samples	673,469	731,677
Finished goods	13,435,730	13,411,007
Inventory gross	14,693,950	16,443,918
Reserve for obsolescence	-3,862,667	-2,633,989
Inventory, net	$10,831,283	$13,809,929

6_Inventories_Details_Narrativ

6. Inventories (Details Narrative) (Due to acquisition of Cypress and Somaxon, USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Due to acquisition of Cypress and Somaxon	'	'
Increase in raw materials	$221,000	$221,000
Increase in finished goods	$849,000	$2,714,000

7_Prepaid_Expenses_and_Other_C2

7. Prepaid Expenses and Other Current Assets (Details) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Prepaid Expenses and Other Current Assets	'	'
Prepaid expenses	$3,527,222	$4,123,087
Deposits on inventory and prepaid royalties	445,169	235,956
Prepaid contracts	43,000	65,733
Capitalized financing costs	1,822,887	786,662
Deposits	227,154	227,154
Deferred expenses	137,224	439,700
Total	$6,202,656	$5,878,292

8_Property_Plant_and_Equipment2

8. Property, Plant, and Equipment (Details) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Property, Plant & Equipment	'	'
Land	$572,342	$1,356,042
Buildings and improvements	43,988	3,986,126
Vehicles	'	15,000
Equipment	771,960	2,343,601
Furniture and fixtures	150,232	189,034
Computer software and website	93,900	93,900
Less accumulated depreciation	-576,369	-1,111,661
Total	$1,056,053	$6,872,042

8_Property_Plant_and_Equipment3

8. Property, Plant, and Equipment (Details Narrative) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Property, Plant & Equipment	'	'
Depreciation Expenses	$149,652	$143,609

9_Assets_and_Liabilities_Held_2

9. Assets and Liabilities Held for Sale (Details) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Assets and Liabilities Held for Sale	'	'
Inventory, net	$1,450,919	'
Prepaid expenses and other current assets	294,940	'
Property and equipment, net	5,781,591	'
Goodwill	915,575	'
Intangible assets, net	1,308,800	'
Total Held for Sale - Assets	9,751,825	'
Impairment charge	-6,456,966	'
Held for Sale - assets, net	3,294,859	'
Accounts payable	-93,945	'
Accrued personnel expense	-119,934	'
Other accrued expenses	-272,420	'
Debt - short-term	-142,036	'
Debt - long-term	-1,273,407	'
Held for sale - liabilities	$1,901,742	'

9_Assets_and_Liabilities_Held_3

9. Assets and Liabilities Held for Sale (Details Narrative) (USD $)	3 Months Ended
	Mar. 31, 2014
Assets Held-for-sale, Long Lived [Abstract]	'
Asset Impairment Charges	$6,456,000

10_Intangible_Assets_and_Goodw2

10. Intangible Assets and Goodwill (Details) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Intangible assets consist of the following	'	'
Intangible assets, gross	$93,436,797	$93,093,170
Accumulated amortization	-14,572,502	-13,070,887
Intangible assets, net	78,864,295	80,022,283
Patents Member	'	'
Intangible assets consist of the following	'	'
Life	'11 years	'
Intangible assets, gross	500,000	500,000
Accumulated amortization	-320,825	-305,625
Brand Member	'	'
Intangible assets consist of the following	'	'
Life	'8 years	'
Intangible assets, gross	3,887,000	3,887,000
Accumulated amortization	-1,943,508	-1,822,038
Product Licenses Member	'	'
Intangible assets consist of the following	'	'
Life	'11.4 years	'
Intangible assets, gross	18,155,421	15,963,794
Accumulated amortization	-2,785,891	-2,383,518
Customer Relationships Member	'	'
Intangible assets consist of the following	'	'
Intangible assets, gross	'	1,848,000
Accumulated amortization	'	-462,204
Noncompete And Supplier Contracts Member	'	'
Intangible assets consist of the following	'	'
Life	'5.3B years	'
Intangible assets, gross	5,194,571	5,194,571
Accumulated amortization	-3,722,321	-3,609,071
Trademark rights Member	'	'
Intangible assets consist of the following	'	'
Life	'Indefinite	'
Intangible assets, gross	399,805	399,805
Accumulated amortization	'	'
In Process Research And Development Member	'	'
Intangible assets consist of the following	'	'
Life	'Indefinite	'
Intangible assets, gross	25,300,000	25,300,000
Accumulated amortization	'	'
Developed Technology Member	'	'
Intangible assets consist of the following	'	'
Life	'9.6B years	'
Intangible assets, gross	40,000,000	40,000,000
Accumulated amortization	($5,799,957)	($4,489,431)

10_Intangible_Assets_and_Goodw3

10. Intangible Assets and Goodwill (Details 1) (USD $)	Mar. 31, 2014
Estimated amortization expense related to intangible assets	'
2014 (April - December)	$5,739,501
2015	7,676,977
2016	7,676,977
2017	5,783,808
2018	4,746,651
Thereafter	21,540,576
Total	$53,164,490

10_Intangible_Assets_and_Goodw4

10. Intangible Assets and Goodwill (Details 2) (USD $)	3 Months Ended	12 Months Ended
	Mar. 31, 2014	Dec. 31, 2013
Goodwill and Intangible Assets Disclosure [Abstract]	'	'
Beginning Balance	$42,496,592	$37,160,911
Goodwill acquired - Somaxon	'	10,748,243
Goodwill impairment - PML	-915,575	'
Adjustments	'	-5,412,562
Total	$41,581,017	$42,496,592

10_Intangible_Assets_and_Goodw5

10. Intangible Assets and Goodwill (Details Narrative) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Goodwill and Intangible Assets Disclosure [Abstract]	'	'
Amortization expense	$2,040,000	$1,548,000

11_Accrued_Allowances_Details

11. Accrued Allowances (Details) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Accrued Allowances Details	'	'
Accrued returns allowance	$11,303,900	$12,049,040
Accrued price adjustments	23,055,190	18,300,788
Accrued government program rebates	4,644,720	3,935,750
Accrued allowances	$39,003,810	$34,285,578

12_Other_Liabilities_Details

12. Other Liabilities (Details) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Other Liabilities [Abstract]	'	'
Product license contracts	$2,500,000	'
Settlement obligations	11,426,000	14,115,000
Deferred revenue	4,227,870	4,279,350
Other	'	66,349
Total contracts payable and other obligations	18,153,870	18,460,699
Other liabilities - current	6,398,751	4,072,933
Other liabilities - long term	$11,755,119	$14,387,766

13_Debt_Details

13. Debt (Details) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Total debt	$70,047,850	$18,309,454
Debt - current	5,047,850	16,999,687
Debt - long term	65,000,000	1,309,767
Amounts outstanding under the Credit Facility - MidCap Funding V, LLC [Member]	'	'
Total debt	5,047,850	16,859,891
Stancorp Mortgage [Member]	'	'
Total debt	'	1,449,563
Convertible senior notes [Member]	'	'
Total debt	$65,000,000	'

13_Debt_Details_Narrative

13. Debt (Details Narrative) (USD $)	3 Months Ended
	Mar. 31, 2014	Dec. 31, 2013
Debt Disclosure [Abstract]	'	'
Term Loan Interest Percentage	9.00%	'
Outstanding balance under the revolver	$5,000,000	$16,900,000
MidCap Funding term loan interest rate	'	'
	The loans under this facility bear interest at a rate equal to the sum of the LIBOR rate plus an applicable margin of 7.50% per annum (9% at March 31, 2014). Pursuant to the Restated Credit Agreement, the Company paid certain customary fees to the administrative agent and lenders.
Interest expense related to the outstanding principal balance	541,000	'
Stated interest rate on note	8.00%	'
Outstanding borrowings	$65,000,000	'

15_Employee_Compensation_and_B2

15. Employee Compensation and Benefits (Details) (USD $)	3 Months Ended
	Mar. 31, 2014
Employee Benefits and Share-based Compensation [Abstract]	'
Weighted average expected stock price volatility	74.00%
Estimated dividend yield	0.00%
Risk-free interest rate	1.80%
Expected life of option (in years)	'6 years 1 month 6 days
Weighted average fair value per share	$2.60

15_Employee_Compensation_and_B3

15. Employee Compensation and Benefits (Details 1) (USD $)	3 Months Ended
	Mar. 31, 2014
Shares	'
Outstanding at December 31, 2012(1)	1,604,500
Granted	2,265,000
Exercised	-79,300
Cancelled	-26,166
Expired	'
Outstanding at September 30, 2013	3,764,034
Vested and exercisable, end of period	1,015,863
Average Exercise Price	'
Outstanding at December 31, 2012(1)	$4.45
Granted	$2.68
Exercised	$3.73
Cancelled	$6.18
Outstanding at September 30, 2013	$3.39
Vested and exercisable, end of period	$4.49

15_Employee_Compensation_and_B4

15. Employee Compensation and Benefits (Details 2) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Options Outstanding Shares	3,764,034	1,604,500
Options Outstanding Shares Remaining Contractual Life (Years)	'8 years 9 months 18 days	'
Options Exercisable Shares	1,015,863	'
Options Exercisable Price	$4.49	'
Range Of Exercise Price From 2.09 to 2.20 Member	'	'
Options Outstanding Shares	1,505,000	'
Options Outstanding Shares Remaining Contractual Life (Years)	'9 years 9 months 18 days	'
Options Exercisable Shares	5,000	'
Options Exercisable Price	$2.20	'
Range of Exercise Price From 3.08 Member	'	'
Options Outstanding Shares	50,000	'
Options Outstanding Shares Remaining Contractual Life (Years)	'9 years 10 months 24 days	'
Options Exercisable Shares	'	'
Options Exercisable Price	'	'
Range of Exercise Price from 3.31 to 4.20 Member	'	'
Options Outstanding Shares	1,831,367	'
Options Outstanding Shares Remaining Contractual Life (Years)	'8 years 1 month 6 days	'
Options Exercisable Shares	801,367	'
Options Exercisable Price	$3.62	'
Range of Exercise Price From 5.66 Member	'	'
Options Outstanding Shares	75,000	'
Options Outstanding Shares Remaining Contractual Life (Years)	'10 years	'
Options Exercisable Shares	'	'
Options Exercisable Price	'	'
Range of Exercise Price from 6.10 Member	'	'
Options Outstanding Shares	124,333	'
Options Outstanding Shares Remaining Contractual Life (Years)	'7 years 4 months 24 days	'
Options Exercisable Shares	87,828	'
Options Exercisable Price	$6.10	'
Range of Exercise Price from 7.75 to 9.02 Member	'	'
Options Outstanding Shares	128,334	'
Options Outstanding Shares Remaining Contractual Life (Years)	'8 years 2 months 12 days	'
Options Exercisable Shares	75,001	'
Options Exercisable Price	$8.59	'
Range of Exercise Price from 10.13 to 10.14 Member	'	'
Options Outstanding Shares	50,000	'
Options Outstanding Shares Remaining Contractual Life (Years)	'7 years 1 month 6 days	'
Options Exercisable Shares	46,667	'
Options Exercisable Price	$10.14	'

15_Employee_Compensation_and_B5

15. Employee Compensation and Benefits (Details 3) (Restricted Stock [Member], USD $)	3 Months Ended
	Mar. 31, 2014
Restricted Stock [Member]	'
Shares	'
Nonvested at December 31, 2013	628,854
Granted	100,000
Vested	-20,999
Forfeited	-404,323
Nonvested at March 31, 2014	303,532
Weighted Average Grant Date Fair Value	'
Nonvested at December 31, 2013	$5.60
Granted	$3.05
Vested	$5.88
Forfeited	$4.91
Nonvested at March 31, 2014	$6.95

15_Employee_Compensation_and_B6

15. Employee Compensation and Benefits (Details 4) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Stock Based Compensation Expense	$1,778,827	$545,256
Employees Member	'	'
Stock Based Compensation Expense	1,698,523	424,910
Non-employees/Directors Member	'	'
Stock Based Compensation Expense	$80,304	$120,346

14_Employee_Compensation_and_B

14. Employee Compensation and Benefits (Details Narrative) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2013
Contribution expense	$106,000	$137,000	'
Outstanding options under Prior Plans	3,764,034	'	1,604,500
Intrinsic value of options exercised	142,000	132,000	'
Weighted-average grant date fair value for options granted	$2.60	$4.64	'
Aggregate intrinsic value of options outstanding	1,015,863	'	'
Aggregate intrinsic value of options exercisable	1,404,000	'	'
Restricted common shares issued	100,000	'	'
Compensation expense related to employee stock purchase plan	6,000	4,000	'
Unrecognized Compensation Cost, employees	4,575,000	'	'
Weighted-average period for recognition of compensation cost	'3 years 8 months 12 days	'	'
Restricted Stock [Member]	'	'	'
Unrecognized Compensation Cost, employees	$1,439,000	'	'
Weighted-average period for recognition of compensation cost	'1 year 7 months 6 days	'	'
2009 Stock Incentive Plan	'	'	'
Outstanding options under Prior Plans	30,000	'	'
Options Outstanding Shares Remaining Contractual Life (Years)	'11 months	'	'

16_Income_Taxes_Details

16. Income Taxes (Details)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Effective income tax rate from continuing operations	'	'
Expected taxes at statutory rates	-35.00%	-35.00%
State taxes, net of federal tax benefit	-2.00%	-1.40%
Nondeductible expenses, including merger related expenses	0.10%	1.60%
Put right expense	0.00%	6.80%
Other	-1.20%	-0.40%
Total	-38.10%	-28.40%

17_Commitments_and_Contingenci2

17. Commitments and Contingencies (Details) (USD $)	Mar. 31, 2014
Commitments and Contingencies Disclosure [Abstract]	'
2014 (April - December)	$231,000
2015	39,000
2016	4,000
Total	$274,000

17_Commitments_and_Contingenci3

17. Commitments and Contingencies (Details Narrative) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2013
Amount agreed to pay to State of Texas	'	'	$12,000,000
Initial payment made for the settlement	2,000,000	'	'
Unrecognized stock compensation cost related to unvested stock options issued to ParaPro	1,171,000	'	'
Para Pro Weighted Average period	'3 years 3 months 18 days	'	'
Rent Expense	165,000	172,000	'
Co-promotion and other revenue sharing arrangements	1,879,000	1,344,000	'
Balance remained unpaid under co-promotion agreement	273,000	'	'
Settlement of patent litigation claims	$3,000,000	'	'

18_Correction_of_an_Error_Deta

18. Correction of an Error (Details) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013	Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013
			Originally Reported Amount [Member]	Originally Reported Amount [Member]	Originally Reported Amount [Member]	Originally Reported Amount [Member]	Correction Amount [Member]	Correction Amount [Member]	Correction Amount [Member]	Correction Amount [Member]
Net revenues	$19,051,552	$22,077,873	$23,926	$18,295	$20,573	$22,078	$23,926	$18,295	$20,573	$22,078
Operating expenses	33,195,687	30,188,459	54,612	24,969	29,088	30,864	56,708	24,259	28,378	30,188
(Loss) Income from operations	-14,144,135	-8,110,586	-30,686	-6,674	-8,515	-8,786	-32,782	-5,964	-7,805	-8,110
Other (expense) income, net	-1,264,252	-2,934,342	13,466	-2,406	143	-2,934	13,466	-2,406	143	-2,934
Income tax (benefit) provision	-5,866,000	-3,134,000	-12,696	-2,676	-2,121	-3,263	-13,090	-2,547	-1,985	-3,134
Net Loss	($9,542,387)	($7,910,928)	($4,524)	($6,404)	($6,251)	($8,457)	($6,226)	($5,823)	($5,677)	($7,910)
Net (loss) income per share - basic	($0.26)	($0.23)	($0.12)	($0.17)	($0.17)	($0.24)	($0.17)	($0.16)	($0.15)	($0.23)
Net (loss) income per share - diluted	($0.26)	($0.23)	($0.12)	($0.17)	($0.17)	($0.24)	($0.17)	($0.16)	($0.15)	($0.23)