Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Mar. 06, 2017 | Jun. 30, 2016 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | CUMBERLAND PHARMACEUTICALS INC | ||
Entity Central Index Key | 1,087,294 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Non-accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding | 16,013,407 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 32,029,223 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 34,510,330 | $ 38,203,059 |
Marketable securities | 15,622,111 | 14,564,115 |
Accounts receivable, net of allowances | 7,330,127 | 6,077,120 |
Inventories | 5,371,729 | 4,270,143 |
Prepaid and other current assets | 2,710,967 | 1,468,913 |
Total current assets | 65,545,264 | 64,583,350 |
Property and equipment, net | 464,454 | 536,450 |
Intangible assets, net | 22,154,176 | 21,168,596 |
Deferred tax assets | 3,119,930 | 3,739,510 |
Other assets | 2,120,742 | 1,891,053 |
Total assets | 93,404,566 | 91,918,959 |
Current liabilities: | ||
Accounts payable | 8,036,611 | 2,877,479 |
Other current liabilities | 6,755,652 | 9,534,268 |
Total current liabilities | 14,792,263 | 12,411,747 |
Revolving line of credit | 4,100,000 | 1,700,000 |
Other long-term liabilities | 1,391,484 | 987,429 |
Total liabilities | 20,283,747 | 15,099,176 |
Commitments and contingencies | ||
Shareholders’ equity: | ||
Common stock – no par value; 100,000,000 shares authorized; 16,074,176 and 16,379,501 shares issued and outstanding as of December 31, 2016 and 2015, respectively | 54,643,268 | 57,338,294 |
Retained earnings | 18,604,931 | 19,549,614 |
Total shareholders’ equity | 73,248,199 | 76,887,908 |
Noncontrolling interests | (127,380) | (68,125) |
Total equity | 73,120,819 | 76,819,783 |
Total liabilities and equity | $ 93,404,566 | $ 91,918,959 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Common stock, no par value (dollars per share) | $ 0 | $ 0 |
Common stock, number of shares authorized | 100,000,000 | 100,000,000 |
Common stock, number of shares issued | 16,074,176 | 16,379,501 |
Common stock, number of shares outstanding | 16,074,176 | 16,379,501 |
Consolidated Statements of Inco
Consolidated Statements of Income and Comprehensive Income (Loss) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Revenues: | |||
Net product revenue | $ 32,478,185 | $ 33,013,184 | $ 36,683,762 |
Other revenue | 547,375 | 505,867 | 218,109 |
Net revenues | 33,025,560 | 33,519,051 | 36,901,871 |
Costs and expenses: | |||
Cost of products sold | 5,958,660 | 4,968,170 | 5,053,165 |
Selling and marketing | 14,553,481 | 13,994,768 | 14,902,202 |
Research and development | 3,190,700 | 3,847,651 | 3,389,419 |
General and administrative | 8,561,811 | 7,607,588 | 8,401,560 |
Amortization | 2,194,039 | 1,989,264 | 1,596,689 |
Total costs and expenses | 34,458,691 | 32,407,441 | 33,343,035 |
Operating income (loss) | (1,433,131) | 1,111,610 | 3,558,836 |
Interest income | 204,661 | 209,183 | 251,447 |
Interest expense | (106,392) | (73,856) | (67,074) |
Income (loss) before income taxes | (1,334,862) | 1,246,937 | 3,743,209 |
Income tax (expense) benefit | 330,924 | (575,829) | (1,380,744) |
Net income (loss) | (1,003,938) | 671,108 | 2,362,465 |
Net loss at subsidiary attributable to noncontrolling interests | 59,255 | 60,243 | 61,258 |
Net income (loss) attributable to common shareholders | $ (944,683) | $ 731,351 | $ 2,423,723 |
Earnings (loss) per share attributable to common shareholders: | |||
Basic (in USD per share) | $ (0.06) | $ 0.04 | $ 0.14 |
Diluted (in USD per share) | $ (0.06) | $ 0.04 | $ 0.14 |
Weighted-average common shares outstanding: | |||
Basic (in shares) | 16,236,525 | 16,715,970 | 17,617,765 |
Diluted (in shares) | 16,236,525 | 17,094,754 | 17,899,632 |
Comprehensive income (loss) attributable to common shareholders | $ (944,683) | $ 731,351 | $ 2,423,723 |
Net loss at subsidiary attributable to noncontrolling interests | 59,255 | 60,243 | 61,258 |
Total comprehensive income (loss) | $ (1,003,938) | $ 671,108 | $ 2,362,465 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Cash flows from operating activities: | |||
Net income (loss) | $ (1,003,938) | $ 671,108 | $ 2,362,465 |
Adjustments to reconcile net income (loss) to net cash flows provided by operating activities: | |||
Depreciation and amortization expense | 2,396,908 | 2,246,809 | 1,989,564 |
Deferred tax expense (benefit) | 619,580 | 490,227 | (309,330) |
Share-based compensation | 852,102 | 622,503 | 761,663 |
Excess tax expense (benefit) derived from exercise of stock options | 1,026,413 | (90,982) | (1,653,028) |
Noncash interest expense | 84,539 | 46,422 | 38,634 |
Noncash investment gains | (74,015) | (77,155) | (52,040) |
Net changes in assets and liabilities affecting operating activities, net of effect of business combination: | |||
Accounts receivable | (1,253,007) | (572,392) | (974,304) |
Inventories | (1,101,586) | 1,330,176 | 1,532,563 |
Prepaid, other current assets and other assets | (1,556,282) | (263,084) | (1,011,365) |
Accounts payable and other current liabilities | 191,901 | 1,475,964 | 3,846,482 |
Other long-term liabilities | 386,863 | (2,731) | 162,127 |
Net cash provided by operating activities | 569,478 | 5,876,865 | 6,693,431 |
Cash flows from investing activities: | |||
Additions to property and equipment | (130,872) | (142,965) | (163,258) |
Cash paid for acquisitions | 0 | 0 | (2,000,000) |
Additions to intangible assets | (2,000,226) | (2,556,465) | (3,101,565) |
Proceeds from sale of marketable securities | 4,489,111 | 7,883,171 | 3,437,645 |
Purchases of marketable securities | (5,473,092) | (7,528,713) | (4,207,262) |
Net cash used in investing activities | (3,115,079) | (2,344,972) | (6,034,440) |
Cash flows from financing activities: | |||
Net borrowings on line of credit | 2,400,000 | 1,700,000 | 0 |
Repurchase of common shares | (2,520,715) | (5,338,967) | (4,315,444) |
Cash settlement of contingent consideration | 0 | (1,668,252) | 0 |
Exercise of stock options | 0 | 21,366 | 0 |
Sale of subsidiary shares to noncontrolling interest | 0 | 0 | 1,000,005 |
Excess tax (expense) benefit derived from exercise of stock options | (1,026,413) | 90,982 | 1,653,028 |
Net cash used in financing activities | (1,147,128) | (5,194,871) | (1,662,411) |
Net decrease in cash and cash equivalents | (3,692,729) | (1,662,978) | (1,003,420) |
Cash and cash equivalents, beginning of year | 38,203,059 | 39,866,037 | 40,869,457 |
Cash and cash equivalents, end of year | 34,510,330 | 38,203,059 | 39,866,037 |
Net cash paid during the year for: | |||
Interest | 21,853 | 27,434 | 28,440 |
Income taxes | (8,359) | 52,238 | 17,077 |
Noncash investing and financing activities: | |||
Change in unpaid invoices for purchases of intangibles | $ (1,179,394) | $ 967,146 | $ (1,574,847) |
Consolidated Statements of Equi
Consolidated Statements of Equity - USD ($) | Total | Common stock | Retained earnings | Noncontrolling interest |
Equity, common shares outstanding at Dec. 31, 2013 | 17,985,503 | |||
Equity, balance at Dec. 31, 2013 | $ 79,291,843 | $ 63,073,941 | $ 16,394,540 | $ (176,638) |
Increase (Decrease) in Shareholders' Equity [Roll Forward] | ||||
Net income (loss) attributable to common shareholders | 2,423,723 | 2,423,723 | ||
Net loss at subsidiary attributable to noncontrolling interests | (61,258) | (61,258) | ||
Net income (loss) | 2,362,465 | |||
Share-based compensation, shares | 15,300 | |||
Share-based compensation, amount | 760,894 | $ 760,894 | ||
Exercise of options and related tax benefit | 1,653,028 | 1,653,028 | ||
Exercise of options and related tax benefit | 1,000,005 | $ 769,991 | 230,014 | |
Repurchase of common shares, shares | (881,810) | |||
Repurchase of common shares | (4,315,444) | $ (4,315,444) | ||
Equity, common shares outstanding at Dec. 31, 2014 | 17,118,993 | |||
Equity, balance at Dec. 31, 2014 | 80,752,791 | $ 61,942,410 | 18,818,263 | (7,882) |
Increase (Decrease) in Shareholders' Equity [Roll Forward] | ||||
Net income (loss) attributable to common shareholders | 731,351 | 731,351 | ||
Net loss at subsidiary attributable to noncontrolling interests | (60,243) | (60,243) | ||
Net income (loss) | 671,108 | |||
Share-based compensation, shares | 86,102 | |||
Share-based compensation, amount | 622,503 | $ 622,503 | ||
Exercise of options and related tax benefit, shares | 3,409 | |||
Exercise of options and related tax benefit | 112,348 | $ 112,348 | ||
Repurchase of common shares | $ (5,338,967) | $ (5,338,967) | ||
Equity, common shares outstanding at Dec. 31, 2015 | 16,379,501 | 16,379,501 | ||
Equity, balance at Dec. 31, 2015 | $ 76,819,783 | $ 57,338,294 | 19,549,614 | (68,125) |
Increase (Decrease) in Shareholders' Equity [Roll Forward] | ||||
Net income (loss) attributable to common shareholders | (944,683) | (944,683) | ||
Net loss at subsidiary attributable to noncontrolling interests | (59,255) | (59,255) | ||
Net income (loss) | (1,003,938) | |||
Share-based compensation, shares | 223,987 | |||
Share-based compensation, amount | 852,102 | $ 852,102 | ||
Exercise of options and related tax benefit | (1,026,413) | $ (1,026,413) | ||
Repurchase of common shares, shares | (529,312) | |||
Repurchase of common shares | $ (2,520,715) | (2,520,715) | ||
Equity, common shares outstanding at Dec. 31, 2016 | 16,074,176 | 16,074,176 | ||
Equity, balance at Dec. 31, 2016 | $ 73,120,819 | $ 54,643,268 | $ 18,604,931 | $ (127,380) |
Organization
Organization | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | Organization Cumberland Pharmaceuticals Inc. and its subsidiaries (the "Company," "Cumberland," or in certain context "our" or "we") is a specialty pharmaceutical company focused on the acquisition, development and commercialization of branded prescription products. The Company's primary target markets are hospital acute care and gastroenterology. These medical specialties are characterized by relatively concentrated prescriber bases that the Company believes can be penetrated effectively by small, targeted sales forces. Cumberland is dedicated to providing innovative products that improve quality of care for patients and address unmet or poorly met medical needs. Cumberland focuses its resources on maximizing the commercial potential of its products, as well as developing new product candidates, and has both internal development and commercial capabilities. The Company’s products are manufactured by third parties, which are overseen by Cumberland’s quality control and manufacturing professionals. The Company works closely with its third-party distribution partner to make its products available in the United States. In order to build a pipeline of early-stage product candidates, the Company formed a subsidiary, Cumberland Emerging Technologies, Inc. ("CET"), which teams with universities and other research organizations to help advance scientific discoveries from the laboratory to the marketplace. The Company’s ownership in CET is 80% . In 2014, the Company organized equity financing to recapitalize and strengthen the financial position of CET. This financing included an investment of approximately $1.0 million from Harbin Gloria Pharmaceuticals Co., Ltd. (“Gloria”). As a result, Gloria received shares in CET and joined the CET ownership group. As noted above, the ownership interests of CET includes Gloria and Cumberland, while the remaining interest is owned by Vanderbilt University and the Tennessee Technology Development Corporation. The operating results of CET allocated to noncontrolling interests in the consolidated statements of operations were approximately $ 59,255 , $ 60,243 and $ 61,258 for the years ended December 31, 2016 , 2015 and 2014 , respectively. Effective January 1, 2007, the Company formed a wholly-owned subsidiary, Cumberland Pharma Sales Corp. ("CPSC"). CPSC is the subsidiary that employs the Company's hospital and field sales force personnel. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies Principles of Consolidation The consolidated financial statements of the Company are stated in U.S. dollars and are prepared using U.S. generally accepted accounting principles. These financial statements include the accounts of the Company and its wholly and majority-owned subsidiaries. All significant intercompany transactions and accounts have been eliminated in consolidation. Use of Estimates The preparation of the consolidated financial statements in conformity with U.S. generally accepted accounting principles require management of the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates under different assumptions and conditions. The Company's most significant estimates include: (1) its allowances for chargebacks and accruals for rebates and product returns and (2) the allowances for obsolescent or unmarketable inventory. Segment Reporting The Company has one operating segment which is specialty pharmaceutical products. Management has chosen to organize the Company based on the type of products sold. Operating segments are identified as components of an enterprise about which separate discrete financial information is evaluated by the chief operating decision maker, or decision-making group, in making decisions regarding resource allocation and assessing performance. The Company, which uses consolidated financial information in determining how to allocate resources and assess performance, evaluated that our specialty pharmaceutical products compete in similar economic markets and similar circumstances. Substantially all of the Company’s assets are located in the United States. Total revenues are primarily attributable to U.S. customers. Net revenues from customers outside the United States were approximately $ 2.0 million , $ 0.9 million and $ 0.6 million for the years ended December 31, 2016 , 2015 and 2014 , respectively. Fair Value of Financial Instruments Fair value of financial assets and liabilities is the price the Company would receive to sell an asset or pay to transfer a liability in an orderly transaction with a market participant at the measurement date. The Company's fair value measurements follow the appropriate rules as well as the fair value hierarchy that prioritizes the information used to develop the measurements. It applies whenever other guidance requires (or permits) assets or liabilities to be measured at fair value and gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). A summary of the fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels is described below: Level 1 - Quoted prices for identical instruments in active markets. Level 2 - Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. Level 3 - Significant inputs to the valuation model are unobservable. We maintain policies and procedures to value instruments using the best and most relevant data available. The following section describes the valuation methodologies we use to measure different financial instruments at fair value on a recurring basis. The Company’s financial instruments include cash and cash equivalents, marketable securities, accounts receivable, accounts payable, accrued liabilities, and a revolving line of credit. The carrying values for cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their fair values due to their short-term nature. The revolving line of credit has a variable interest rate, which approximates the current market rate. The Company's fair values of marketable securities are determined based on valuations provided by a third-party pricing service, as derived from such services' pricing models, and are considered either Level 1 or Level 2 measurements, depending on the nature of the investment. The Company has no marketable securities in which the fair value is determined based on Level 3. The level of management judgment required in evaluating fair value for Level 1 investments is minimal. Similarly, there is little subjectivity or judgment required for Level 2 investments valued using valuation models that are standard across the industry and whose parameter inputs are quoted in active markets. Inputs to the models may include, but are not limited to, reported trades, executable bid and ask prices, broker/dealer quotations, prices or yields of securities with similar characteristics, benchmark curves or information pertaining to the issuer, as well as industry and economic events. Based on the information available, the Company believes that the valuations provided by the third-party pricing service, as derived from such services' pricing models, are representative of prices that would be received to sell the assets at the measurement date (exit prices). Cash and Cash Equivalents Cash and cash equivalents include highly liquid investments with original maturities of three months or less. As of December 31, 2016 and 2015 , cash equivalents consist primarily of money market funds. Marketable Securities The Company invests in marketable debt securities in order to maximize its return on cash. Marketable securities consist of U.S. Treasury notes and bonds, U.S. Government Agency notes and bonds and bank-guaranteed, variable rate demand notes (VRDN). At the time of purchase, the Company classifies marketable securities as either trading securities or available-for-sale securities, depending on the intent at that time. As of December 31, 2016 and 2015 , marketable securities were comprised solely of trading securities. Trading securities are carried at fair value with unrealized gains and losses recognized as a component of interest income in the consolidated statements of operations. Accounts Receivable Trade accounts receivable are recorded at the invoiced amount. The Company records allowances for amounts that could become uncollectible in the future based on historical experience, including amounts related to chargebacks, cash discounts and credits for damaged product. The Company reviews each customer balance to assess collectibility. The majority of the Company’s products are distributed through independent pharmaceutical wholesalers. Net product revenues and accounts receivable take into account the sale of the product at the wholesale acquisition cost, and an accrual is recorded to reflect the difference between the wholesale acquisition cost and the estimated average end-user contract price. This accrual is calculated on a product-specific basis and is based on the estimated number of outstanding units sold to wholesalers that will ultimately be sold in end-user contracts. When the wholesaler sells the product to the end-user at the agreed upon end-user contract price, the wholesaler charges the Company for the difference between the wholesale acquisition price and the end-user contract price and this chargeback is offset against the initial accrual balance. Cash discounts are reductions to invoiced amounts offered to customers for payment within a specified period of time from the date of the invoice. At the time a transaction is recognized as a sale, the Company records a reduction in revenues for an estimate of damaged product in the shipment. The Company’s estimate of the allowance for damaged product is based upon historical experience of claims made for damaged product. Inventories The Company works closely with third parties to manufacture and package finished goods for sale. Based on the customer relationship with the manufacturer or packager, the Company will either take title to finished goods at the time of shipment or at the time of arrival from the manufacturer. The Company then warehouses such goods until distribution and sale. Inventories are stated at the lower of cost or market with cost determined using the first-in, first-out method. The Company continually evaluates inventories for potential losses due to excess, obsolete or slow-moving inventory by comparing sales history and sales projections to the inventory on hand. When evidence indicates the carrying value of a product may not be recoverable, a charge is recorded to reduce the inventory to its current net realizable value. Prepaid and Other Current Assets Prepaid and other current assets consist of the current portion of unamortized deferred financing costs, prepaid insurance premiums, prepaid consulting services and annual fees paid to the U.S. Food and Drug Administration ("FDA"). The Company expenses all prepaid amounts as used or over the period of benefit primarily on a straight-line basis, as applicable. Property and Equipment Property and equipment, including leasehold improvements, are stated at cost. Depreciation is recognized using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the shorter of the initial lease term plus renewal options, if reasonably assured, or the remaining useful life of the asset. Upon retirement or disposal of assets, any gain or loss is reflected as a component of operating income in the consolidated statement of operations. Improvements that extend an asset’s useful life are capitalized. Repairs and maintenance costs are expensed as incurred. Intangible Assets The Company’s intangible assets consist of capitalized costs related to product and license rights, patents and trademarks. The cost of acquiring product and license rights are capitalized at fair value at the date of acquisition for products that are approved by the FDA for commercial use. These costs are amortized ratably over the estimated economic life of the product. The economic life is estimated based upon the term of the license agreement, patent life or market exclusivity of the product and based on management's assessment of future sales and profitability of the product. This estimate is evaluated on a regular basis during the amortization period and adjusted if appropriate. If there are any changes made to the useful life of the product and license rights, the costs associated with such a change, if any, will be capitalized and amortized over the revised useful life. Capitalized patent costs consist of outside legal costs associated with obtaining and protecting patents on products that have been approved for marketing by the FDA. If it becomes probable that a patent will not be issued or a patent has been declared invalid, related costs associated with the patent application are expensed at the time such determination is made. All costs associated with obtaining patents for products that have not been approved for marketing by the FDA are expensed as incurred. Amortization expense is recognized ratably over the following periods: Product rights Estimated economic life License rights Term of license agreement Patents Life of patent Impairment of Long-Lived Assets Long-lived assets, such as property and equipment and intangible assets subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. If events or circumstances arise that require a long-lived asset to be tested for potential impairment, the Company first compares undiscounted cash flows expected to be generated by the asset to its carrying value. If the carrying amount of the long-lived asset is not recoverable on an undiscounted cash flow basis, an impairment charge is recognized to the extent that the carrying value exceeds the fair value. Fair value is determined through various valuation techniques including quoted market prices, third-party independent appraisals and discounted cash flow models. The Company recorded no impairment charges during 2016 , 2015 and 2014 . Revenue Recognition Revenue is realizable and earned when all of the following criteria are met: persuasive evidence of an arrangement exists; delivery has occurred or services have been rendered; the seller’s price to the buyer is fixed and determinable; and collectibility of the related receivable is reasonably assured. Delivery is considered to have occurred upon either shipment of the product or arrival at its destination, depending upon the shipping terms of the transaction. Product Revenues The Company’s net product revenue reflects the reduction from gross product revenue for estimated allowances for chargebacks, discounts and damaged goods, and reflects sales related accruals for rebates, product returns, and certain administrative and service fees. As discussed above, the allowances against accounts receivable for chargebacks, discounts and damaged goods are determined on a product-by-product basis, and established by management as the Company’s best estimate at the time of sale based on each product’s historical experience adjusted to reflect known changes in the factors that impact such allowances. These allowances are established based on the contractual terms with direct and indirect customers and analyses of historical levels of chargebacks, discounts and credits claimed for damaged product. Other organizations, such as managed care providers, pharmacy benefit management companies and government agencies, may receive rebates from the Company based on either negotiated contracts to carry the Company’s products or reimbursements for filled prescriptions. These entities are considered indirect customers of the Company. In addition, the Company may provide rebates to end-user customers. In conjunction with recognizing a sale to a wholesaler, sales revenues are reduced and accrued liabilities are increased by the Company’s estimate of the rebate that may be claimed. Consistent with industry practice, the Company maintains a return policy that allows customers to return product within a specified period prior to and subsequent to the expiration date. The Company’s estimate of the provision for returns is based upon historical experience. Any changes in the assumptions used to estimate the provision for returns are recognized in the period those assumptions changed. The Company has agreements with certain key wholesalers that include a fee for service costs. These costs are netted against product revenues. Other Revenues Other revenues primarily consist of income from grant funding programs, licensing agreements, leases and contract services. Revenue related to grants is recognized when all conditions related to such grants have been met. All other revenue is recognized when earned. The Company is a party to several licensing arrangements to register and commercialize the Company's products in markets outside the U.S. Under these licensing arrangements, the third-party licensee has access to the Company's FDA registration dossier. Licensing arrangements typically include an up-front payment for gaining access to the dossier file, royalties and milestone payments upon the achievement of specific sales levels. The amounts received for access to the FDA registration file are evaluated and based on the evaluation, the resulting revenue is either recognized upfront or recognized over the term of the arrangement. Royalties and milestones are recognized as revenue when earned. For substantive milestones, the Company uses the milestone method of recognizing revenue if it is commensurate with either the performance to achieve the milestone or the enhancement of the value of the delivered item, it relates solely to past performance and it is reasonable relative to other milestones. Cost of Products Sold Cost of products sold consists principally of the cost to acquire each unit of product sold, including in-bound freight expense. Cost of products sold also includes expenses associated with the write-down of slow-moving or expired product. Selling and Marketing Expense Selling and marketing expense consists primarily of expenses relating to the advertising, promotion, distribution and sale of products, including royalty expense, salaries and related costs. Distribution Costs Distribution costs are expensed as incurred and totaled $ 0.7 million , $0.8 million , and $ 1.0 million in 2016 , 2015 and 2014 , respectively. They are included as a component of selling and marketing expenses in the consolidated statements of operations. Advertising Costs Advertising costs are expensed as incurred. These costs were $ 2.6 million , $ 2.6 million and $ 2.5 million in 2016 , 2015 and 2014 , respectively, and are included as a component of selling and marketing expenses in the consolidated statements of operations. Research and Development Research and development costs are expensed in the period incurred. Research and development costs are comprised mainly of clinical trial expenses, salaries, wages and other related costs such as materials and supplies. Development expense includes activities performed by third-party providers participating in the Company’s clinical studies. The Company accounts for these costs based on estimates of work performed, patients enrolled or fixed fees for services. Income Taxes The Company provides for deferred taxes using the asset and liability approach. Under this method, deferred tax assets and liabilities are recognized for future tax consequences attributable to operating loss and tax credit carryforwards, as well as differences between the carrying amounts of existing assets and liabilities and their respective tax bases. The Company’s principal differences are related to the timing of deductibility of certain items, such as inventory, depreciation, amortization and share-based compensation. Deferred tax assets and liabilities are measured using enacted statutory tax rates that are expected to apply to taxable income in the years such temporary differences are anticipated to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period of enactment. The Company only recognizes income tax benefits associated with an income tax position in which it is “more likely than not” that the position would be sustained upon examination by the taxing authorities. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of existing temporary differences, projected future taxable income and tax planning strategies in making this assessment. The Company’s accounting policy with respect to interest and penalties arising from income tax settlements is to recognize them as part of the provision for income taxes. Comprehensive Income (Loss) Total comprehensive income (loss) was comprised solely of net income (loss) for all periods presented. Earnings (Loss) per Share Basic earnings per share is calculated by dividing net income attributable to common shareholders by the weighted-average number of shares outstanding. Except where the result would be antidilutive to income from continuing operations, diluted earnings per share is calculated by assuming the vesting of unvested restricted stock and the exercise of stock options and warrants, unrecognized compensation costs, as well as the related income tax benefits. Share-Based Payments The Company recognizes compensation cost for all share-based payments issued, modified, repurchased or canceled. Depending on the nature of the vesting provisions, restricted stock awards are measured using either the fair value on the grant date or the fair value of common stock on the date the vesting provisions lapse. Prior to the lapse for those equity grants not valued on the grant date, the fair value is measured on the last day of the reporting period. Collaborative Agreements The Company is a party to several collaborative arrangements with certain research institutions to identify and pursue promising pre-clinical pharmaceutical product candidates. The Company has determined these collaborative agreements do not meet the criteria for accounting under Accounting Standards Codification 808, Collaborative Agreements. The agreements do not specifically designate each party's rights and obligations to each other under the collaborative arrangements. Except for patent defense costs, expenses incurred by one party are not required to be reimbursed by the other party. The funding for these programs is generally provided through private sector investments or federal Small Business Administration ("SBIR/STTR") grant programs. Expenses incurred under these collaborative agreements are included in research and development expenses in the consolidated statements of operations. Funding received from private sector investments and grants are recorded as net revenues in the consolidated statements of operations. Recent Accounting Guidance In November 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU"), “Statement of Cash Flows—Restricted Cash—a consensus of the FASB Emerging Issues Task Force.” This revised standard is an effort by the FASB to reduce existing diversity in practice by providing specific guidance on the presentation of restricted cash or restricted cash equivalents in the statement of cash flows. The updated guidance requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash and restricted cash equivalents. As such, amounts generally described as restricted cash and restricted cash equivalents should be included in the “beginning–of–period” and “end–of–period” total amounts shown on the statement of cash flows. The effective date for this standard is for years beginning after December 15, 2017, with early adoption permitted. The Company is evaluating the potential impact of this adoption on our condensed consolidated financial statements and disclosures. In August 2016, the FASB issued amended guidance in the form of a FASB ASU, "Classification of Certain Cash Receipts and Cash Payments." The core principle of the new guidance is to address eight specific cash flow issues with the objective of reducing the existing diversity in practice. The amendments in this update are effective for fiscal years beginning after December 15, 2017. The accounting guidance should be applied retrospectively and early adoption is permitted. The Company continues to evaluate the potential impact of this adoption on our condensed consolidated financial statements and disclosures but currently it does not anticipate that adoption will have a material impact. In May 2014, the FASB issued amended guidance in the form of a FASB ASU, "Revenue from Contracts with Customers." The core principle of the new guidance is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. The new guidance defines a five-step process to achieve this core principle and, in doing so, additional judgments and estimates may be required within the revenue recognition process. The new standard will replace most of the existing revenue recognition standards in U.S. GAAP when it becomes effective. In July 2015, the FASB issued a one-year deferral of the adoption date, which extended the effective date for the Company to January 1, 2018 at which point the Company will adopt the standard. The new standard can be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of the change recognized at the date of the initial application. The Company is assessing the appropriate method for implementing the ASU, as well as the impact the adoption of the ASU will have on its consolidated financial statements and footnote disclosures. In July 2015, the FASB issued amended guidance in the form of a FASB ASU, “Inventory: Simplifying the Measurement of Inventory.” The amended guidance requires entities to measure inventory at the lower of cost or net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The requirement would replace the current lower of cost or market evaluation. Accounting guidance is unchanged for inventory measured using last-in, first-out (“LIFO”) or the retail method. The amendments in this update are effective for fiscal years beginning after December 15, 2016. The accounting guidance should be applied prospectively and early adoption is permitted. The Company continues to evaluate the potential impact of this adoption on our condensed consolidated financial statements and disclosures but currently, it does not expect adoption to have a material impact. In November 2015, the FASB amended guidance in the form of a FASB ASU, "Balance Sheet Classification of Deferred Taxes," which requires that all deferred tax assets and liabilities be classified as noncurrent on the balance sheet instead of separating deferred taxes into current and noncurrent amounts. The FASB determined that this simplification could reduce cost and complexity without decreasing the usefulness of information provided to financial statement users. The amendments in this update are effective for fiscal years beginning after December 15, 2016. The Company has adopted this accounting guidance as of December 31, 2016 and applied retrospective disclosure to the comparison periods. In February 2016, the FASB issued guidance in the form of a FASB ASU, "Leases." The new standard establishes a right-of-use (ROU) model that requires a lessee to record an ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain optional practical expedients available. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company is evaluating its current lease agreements for the impact of its pending adoption of the new standard on its consolidated financial statements and disclosures. The Company's operating leases include the lease of approximately 25,500 square feet of office space in Nashville, Tennessee for its corporate headquarters with the lease expiring in October 2022. The CET lease of approximately 14,200 square feet of office and wet laboratory space in Nashville, Tennessee through April 2018 is also included to operate the CET Life Sciences Center. In March 2016, the FASB released in the form of a FASB ASU, "Compensation - Stock Compensation: Improvements to Employee Share-Based Payment Accounting." The ASU includes multiple provisions intended to simplify various aspects of the accounting for share-based payments. While aimed at reducing the cost and complexity of the accounting for share-based payments, the amendments are expected to significantly impact net income, earnings per share ("EPS"), and the statement of cash flows. Implementation and administration may present challenges for companies with significant share-based payment activities. The ASU is effective for public companies in annual periods beginning after December 15, 2016, and interim periods within those years. The Company is currently evaluating the impact of adoption on the consolidated financial statements including the unrecognized net operating loss carryforwards generated from the exercise of nonqualified options of approximately $44.1 million and the future vesting of shares of restricted stock issued to employees and directors. |
Vaprisol, Omeclamox-Pak, Ethyol
Vaprisol, Omeclamox-Pak, Ethyol, and Methotrexate | 12 Months Ended |
Dec. 31, 2016 | |
Business Combinations [Abstract] | |
Vaprisol®, Omeclamox®-Pak, Ethyol®, and Methotrexate® | Vaprisol ® , Omeclamox ® -Pak, Ethyol ® , and Methotrexate ® Vaprisol On February 28, 2014, the Company acquired certain product rights, intellectual property and related assets of Vaprisol from Astellas Pharma US, Inc. ("Astellas"). Vaprisol is a patented, prescription brand indicated to raise serum sodium levels in hospitalized patients with euvolemic and hypervolemic hyponatremia. The product was developed and registered by Astellas and then launched in 2006. It is one of two branded prescription products indicated for the treatment of hyponatremia. Cumberland's acquisition of Vaprisol was accounted for as a business combination and the products sales were included in the results of operations subsequent to the acquisition date. The Company provided an upfront payment of $2.0 million to Astellas at closing. The business combination provided for an additional milestone payment of up to $2.0 million , dependent upon Cumberland achieving certain first year sales levels for the product. The Company paid Astellas $1.7 million to fulfill the contingent consideration during April 2015. In 2015, the Company recognized a $0.3 million reduction in expense related to the contingent consideration as the cost of the Vaprisol acquisition was less than anticipated. Cumberland paid approximately $0.1 million under the acquired contingent liabilities and recognized a $0.3 million reduction in expense during 2015 upon the resolution of the underlying contingency. Cumberland's acquisition of Vaprisol is accounted for as a business combination and the products sales are included in the results of operations subsequent to the acquisition date. The following table summarizes the allocation of the fair value of the assets acquired and liabilities assumed as of the acquisition date for Vaprisol: Intellectual property intangible assets $ 2,990,000 Inventories 1,410,000 Acquired contingent liabilities (400,000 ) Contingent consideration obligation (2,000,000 ) Total net assets acquired $ 2,000,000 The contingent consideration obligation represents the additional milestone payment discussed above. Cumberland prepared the valuations of the contingent consideration obligation and the intangible assets utilizing significant unobservable inputs. As a result, the valuations are classified as Level 3 fair value measurements. Vaprisol contributed $1.9 million , $2.6 million , and $3.0 million in net revenues during 2016 , 2015 , and 2014 , respectively. Omeclamox-Pak During November 2015, Cumberland entered into a new agreement with Gastoenterlogics Inc. ("GEL") to assume the remaining commercial rights to Omeclamox-Pak for the United States. Omeclamox-Pak is a branded prescription product that combines omeprazole, amoxicillin and clarithromycin for the treatment of Helicobacter pylori ( H. pylori ) infection and duodenal ulcer disease. The Company had previously signed an agreement with Pernix Therapeutics ("Pernix") to jointly commercialize the product in the U.S. in October 2013. As part of the new GEL Agreement, Cumberland and Pernix terminated their arrangements. The Company will continue to market and sell Omeclamox-Pak and is now responsible for the supply chain, national accounts and all sales promotion as part of the GEL agreement. The agreement with GEL has a term through November 2035, with no additional upfront payments required. Royalty payments ranging from 15% to 20% based on tiered levels of gross profits are paid by Cumberland to GEL. Under the Company's previous agreement with Pernix to distribute and promote Omeclamox-Pak it paid an upfront payment of $4.0 million to Pernix in October 2013. The agreement called for additional milestones at the first and second anniversary dates of the execution of the agreement totaling $4.0 million in the aggregate. Cumberland was not required to make either milestone payment to Pernix as all the criteria for these payments were not met, including Pernix's co-promotion obligations. Royalty payments ranging from 15% to 20% based on tiered levels of gross profits were paid by Cumberland to Pernix. The $4.0 million upfront payment that the Company paid in October 2013 is included in product and license rights and is being amortized over the remaining expected useful life of the acquired asset, currently the life of the original Pernix agreement, June 2032. The agreement with GEL has a term of November 2035 and the Company has decided to maintain the original useful life for amortization purposes. Omeclamox-Pak contributed $2.5 million , $3.0 million , and $4.1 million in net revenues during 2016 , 2015 , and 2014 , respectively. Ethyol During May 2016, the Company announced an agreement with Clinigen Group Plc ("Clinigen") in which Cumberland acquired the exclusive rights to commercialize Ethyol in the United States. Ethyol is a FDA approved cytoprotective drug indicated as an adjuvant therapy to reduce the incidence of xerostomia (dry mouth) as a side-effect in patients undergoing post-operative radiation treatment for head and neck cancer. It also reduces the cumulative renal toxicity associated with the repeated administration of cisplatin in patients with advanced ovarian cancer. Under the terms of the agreement, Cumberland is responsible for all marketing, promotion, and distribution of the product in the United States. There are no upfront payments required under the agreement. Royalty payments ranging from 30% to 50% based on tiered levels of net sales are paid by Cumberland to Clinigen. The Company began generating revenue from the sale of Ethyol during the third quarter of 2016. Ethyol contributed $0.8 million in net revenue during 2016 . Methotrexate In November 2016, the Company announced an Agreement to acquire the exclusive U.S. rights to Nordic Group B.V.’s ("Nordic") injectable methotrexate product line. The products are designed for the treatment of active rheumatoid arthritis, juvenile idiopathic arthritis, severe psoriatic arthritis, and severe disabling psoriasis. The product line is approved for patient use in various European countries. Cumberland will register and commercialize the methotrexate products in the United States. Under the terms of the Agreement, Cumberland will be responsible for the products’ FDA submission and registration. The regulatory submission will be based on the dossier provided by Nordic. Following registration, Cumberland will be responsible for product launch and commercialization, including all marketing, promotion, and distribution of the products in the U.S. As consideration for the license, Cumberland paid a deposit of $100,000 and recorded a liability of $900,000 provided through 180,000 unvested restricted shares of Cumberland stock, valued on November 15, 2016, that will fully vest upon the FDA approval of the first Nordic product. Cumberland will also provide Nordic a series of payments tied to the products’ FDA approval, launch and achievement of certain sales milestones. Nordic will be responsible for manufacturing and supply of the products. As of December 31, 2016 , the 180,000 shares of unvested restricted Cumberland stock are valued at $990,000 . |
Revenues
Revenues | 12 Months Ended |
Dec. 31, 2016 | |
Revenues [Abstract] | |
Revenues | Revenues Product Revenues The Company’s net product revenues consisted of the following for the years ended December 31: 2016 2015 2014 Products: Acetadote $ 7,214,341 $ 8,489,167 $ 11,906,232 Omeclamox-Pak 2,536,027 3,037,078 4,111,916 Kristalose 15,898,760 15,733,327 14,932,271 Vaprisol 1,857,838 2,641,484 3,011,997 Caldolor 4,132,833 3,112,128 2,721,346 Ethyol 838,386 — — Total net product revenues $ 32,478,185 $ 33,013,184 $ 36,683,762 As discussed in Note 3, the Company acquired rights to Omeclamox-Pak, Vaprisol, and Ethyol. Omeclamox-Pak and Vaprisol contributed to Cumberland's net revenue during 2016 , 2015 and 2014 and Ethyol contributed to net revenue during 2016 . Cumberland supplies Perrigo Company ("Perrigo") with an Authorized Generic version of the Company's Acetadote product. The Company's revenue generated by sales of its Authorized Generic distributed by Perrigo is included in the Acetadote product revenue presented above. The Company's share of Authorized Generic revenue was $4.8 million , $4.5 million and $5.8 million during 2016 , 2015 and 2014 , respectively. In 2011, the Company discontinued sales of the 400mg Caldolor offering domestically and focused on the 800mg Caldolor offering. During 2016 and 2015 , Cumberland had total sales of $2.0 million and $0.8 million and of its 400mg Caldolor offering outside the United States, respectively. The allowances in accounts receivable for chargebacks, cash discounts and damaged goods were $0.4 million at December 31, 2016 and $0.4 million at December 31, 2015 , and the accruals for rebates, product returns and certain administrative and service fees included in other current liabilities were $4.1 million and $ 6.8 million , at December 31, 2016 and 2015 , respectively. Other Revenues The Company has entered into agreements, beginning in 2012, with international partners for commercialization of the Company's products. The international agreements provide that each of the partners are responsible for seeking regulatory approvals for the products, and following approvals, each partner will handle ongoing distribution and sales in the respective international territories. The Company maintains responsibility for the intellectual property and product formulations. Under the international agreements, the Company is entitled to receive non-refundable up-front payments at the time the agreements are entered into and milestone payments upon the partners' achievement of defined regulatory approvals and sales milestones. The Company will recognize revenue for these substantive milestones using the milestone method. The Company is also entitled to receive royalties on future sales of the products under the agreements. The international agreements provide for $1.4 million in non-refundable up-front payments and milestone payments of up to $1.7 million related to regulatory approvals and up to $4.7 million in payments related to product sales. As of December 31, 2016 , the Company has recognized a cumulative $1.5 million in upfront payments as other revenue and has recognized $0.2 million revenue related to the milestone payments associated with these international agreements. Other revenues during 2016 , 2015 and 2014 also includes revenue generated by CET through grant funding from federal Small Business grant programs, and lease income generated by CET’s Life Sciences Center and contract services. The Life Sciences Center is a research center that provides scientists with access to flexible lab space and other resources to develop biomedical products. Grant revenue from SBIR/STTR programs totaled approximately $0.1 million , $ 0.2 million , and $0.1 million for the years ending December 31, 2016 , 2015 and 2014 , respectively. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories The Company's net inventories consisted of the following as of December 31: 2016 2015 Raw materials and work in process $ 2,810,711 $ 2,576,621 Consigned inventory 277,324 235,636 Finished goods 2,283,694 1,457,886 Total inventories $ 5,371,729 $ 4,270,143 Caldolor inventory on hand at December 31, 2015 and earlier, had varying original expiration dates ranging from the second quarter of 2014 and extending through January 2016. During 2013 and again in 2014, the Company provided stability data to the Food and Drug Administration ("FDA") supporting the extension of the Caldolor product expiration dates by an additional year to January 2017. The FDA notified the Company that it had approved both requests to extend the original shelf life of the Caldolor 800mg vials from five to six years in January 2014 and from six to seven years in March 2015. During 2016 , the Company began to receive new Caldolor 800 mg supplies, with a six year shelf life and began to sell the new inventory in the United States. At December 31, 2016 and 2015 , the Company has recognized and maintained cumulative charges for potential obsolescence and discontinuance losses, primarily for Caldolor prior to December 31, 2015 , of approximately $ 0.3 million and $ 2.7 million , respectively. In connection with the acquisition of certain product rights related to the Kristalose brand, the Company is responsible for the purchase of the active pharmaceutical ingredient ("API") for Kristalose and maintains the inventory at the third-party packager. As the API is consumed in production, the value of the API is transferred from raw materials to finished goods. API for the Company's Vaprisol brand is also included in the raw materials inventory total at December 31, 2016 and 2015 . Consigned inventory represents Authorized Generic inventory stored with Perrigo until shipment. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment Property and equipment consisted of the following at December 31: Range of useful lives 2016 2015 Computer equipment 3 – 5 years $ 933,752 $ 839,563 Office equipment 3 – 15 years 355,456 332,126 Furniture and fixtures 5 – 15 years 618,808 618,808 Leasehold improvements 3 – 15 years, or remaining lease term 1,256,378 1,243,025 Total property and equipment, gross 3,164,394 3,033,522 Less: accumulated depreciation and amortization (2,699,940 ) (2,497,072 ) Total property and equipment, net $ 464,454 $ 536,450 Depreciation expense, including amortization expense related to leasehold improvements, was $0.2 million , $0.3 million , and $0.4 million for the years ended December 31, 2016 , 2015 and 2014 , respectively. Depreciation expense is included in general and administrative expense in the consolidated statements of operations. |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Intangible Assets Intangible assets consisted of the following at December 31: 2016 2015 Product and license rights $ 20,543,262 $ 18,011,362 Less: accumulated amortization (4,988,333 ) (3,541,305 ) Total product and license rights 15,554,929 14,470,057 Patents 8,844,994 8,236,719 Less: accumulated amortization (2,298,442 ) (1,551,430 ) Total patents 6,546,552 6,685,289 Trademarks 61,715 22,270 Less: accumulated amortization (9,020 ) (9,020 ) Total trademarks 52,695 13,250 Total intangible assets $ 22,154,176 $ 21,168,596 In February 2014, the Company acquired the rights of the branded prescription product Vaprisol from Astellas (discussed more fully in Note 3). The intangible asset value is $3.0 million and is included in product and license rights. The asset will be amortized through February 2022, the remaining expected useful life of the acquired asset, which coincides with the life of the primary intellectual property asset. During 2013, the Company entered into an agreement with Pernix to distribute and promote the branded prescription product Omeclamox-Pak. The $4.0 million upfront payment the Company paid to Pernix Therapeutics on October 29, 2013 (discussed more fully in Note 3) is included in product and license rights and will be amortized through June 2032, the remaining expected useful life of the acquired asset. In 2011, the Company acquired the Kristalose trademark and FDA registration from Mylan Inc. The agreement requires the Company to make future quarterly payments over a seven -year period equal to a percentage of Kristalose net sales. The payments are being treated as consideration for the assets acquired and are being capitalized and amortized over the remaining expected useful life of the acquired asset, currently through 2026. During 2016 and 2015 , the Company paid $1.4 million and $1.5 million , respectively, to Mylan Inc. in Kristalose payments. In November 2016, the Company acquired the U.S. rights to Nordic Group B.V.’s innovative injectable methotrexate product line. The agreement requires the Company to make future milestone payments over a fifteen-year period from the effective grant of the Regulatory Approval of the Methotrexate Pre-Filled Syringe Product in the U.S. The payments are being treated as consideration for the assets acquired and are being capitalized and will be amortized over the expected useful life of the acquired asset, once approval is granted. During 2016 , the Company paid a deposit of $100,000 as well as recorded a liability of $900,000 provided through 180,000 unvested restricted shares of Cumberland stock, valued on November 15, 2016, that will fully vest upon the FDA approval of the first Nordic product. As of December 31, 2016 , the 180,000 shares of unvested restricted Cumberland stock are valued at $990,000 . During 2016 and 2015 , the Company recorded an additional $0.6 million and $0.1 million , respectively, in intangible assets for patents, trademarks and capitalized patent costs, including amounts incurred in the protection of the Company's intellectual property. These costs will be amortized over the remaining expected useful life of the associated patents. Amortization expense related to product and license rights, trademarks and patents was $ 2.2 million , $ 2.0 million and $ 1.6 million during 2016 , 2015 and 2014 , respectively. The expected amortization expense for the Company's current balance of intangible assets are as follows: Year ending December 31: 2017 $ 2,320,093 2018 2,338,260 2019 2,392,760 2020 2,392,760 2021 and thereafter 12,710,303 $ 22,154,176 |
Other Current Liabilities
Other Current Liabilities | 12 Months Ended |
Dec. 31, 2016 | |
Other Liabilities, Current [Abstract] | |
Other Current Liabilities | Other Current Liabilities Other current liabilities consisted of the following at December 31: 2016 2015 Rebates, product returns, administrative fees and service fees $ 4,051,029 $ 6,776,023 Employee wages and benefits 872,914 1,034,991 Other 1,831,709 1,723,254 Total other current liabilities $ 6,755,652 $ 9,534,268 |
Debt
Debt | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Debt | Debt Debt Agreement On June 26, 2014, the Company entered into a Revolving Credit Loan Agreement (“Loan Agreement”) with SunTrust Bank. The agreement replaced the August 2011 Fifth Amended and Restated Loan Agreement with a previous lender which was to expire on December 31, 2014. The Company had $4.1 million in borrowings under the Loan Agreement at December 31, 2016 . On July 29, 2016, Cumberland amended the agreement to extend the original three-year term by an additional year. The initial revolving line of credit is up to $12.0 million , an increase from the $10.0 million under the previous agreement. The Company has the ability to increase the borrowing amount up to $20.0 million , upon the satisfaction of certain conditions. The interest rate on the Loan Agreement is based on LIBOR plus an interest rate spread. There is no LIBOR minimum and the LIBOR pricing provides for an interest rate spread of 1.0% to 2.85% (representing an interest rate of 1.6% at December 31, 2016 ). In addition, a fee of 0.25% per year is charged on the unused line of credit. Interest expense and the unused line fee are payable quarterly. Borrowings under the line of credit are collateralized by substantially all of the Company's assets. Under the Loan Agreement, Cumberland is subject to certain financial covenants, including, but not limited to, maintaining a Funded Debt Ratio, as such term is defined in the Loan Agreement and determined on a quarterly basis. On July 29, 2016, Cumberland obtained a compliance waiver for a financial covenant as of June 30, 2016. On October 28, 2016, the Company obtained a compliance waiver and amended the agreement to modify a financial covenant, replacing the EBIT to interest ratio covenant with a minimum liquidity requirement. As a result of the covenant waiver and modification in the October 28, 2016 amendment, the Company achieved compliance with all covenants as of September 30, 2016. The Company was in compliance with all covenants at December 31, 2016 . The Company incurred no early termination penalties upon termination of the previous Agreement and incurred less than $0.1 million in deferred financing costs related to the Loan Agreement, which will be amortized to interest expense using the effective interest method over the term of the Loan Agreement. |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Dec. 31, 2016 | |
Stockholders' Equity Note [Abstract] | |
Shareholders' Equity | Shareholders’ Equity (a) Initial Public Offering On August 10, 2009 , the Company completed its initial public offering of 5,000,000 shares of common stock at a price of $ 17.00 per share, raising gross proceeds of $ 85.0 million . After deducting underwriting discounts of approximately $ 6.0 million and offering costs incurred of approximately $ 4.2 million , the net proceeds to the Company were approximately $ 74.8 million . Contemporaneously with the offering, each outstanding share of preferred stock was automatically converted into two shares of common stock. (b) Preferred Stock The Company is authorized to issue 20,000,000 shares of preferred stock. The Board of Directors is authorized to divide these shares into classes or series, and to fix and determine the relative rights, preferences, qualifications and limitations of the shares of any class or series so established. At December 31, 2016 and 2015 , there was no preferred stock outstanding. (c) Common Stock During 2016 , 2015 and 2014 , the Company issued 223,987 shares, 86,102 shares, and 15,300 shares of common stock, respectively, as a result of restricted shares vesting as well as other common share issuances. Cumberland issued 3,409 common shares under option exercise transactions during 2015 . There were no option exercise transactions during 2016 and 2014 . The payment of dividends is restricted by the Agreement with the Company’s primary lender. (d) Warrants In 2006, the Company signed a new line of credit agreement along with a term loan agreement with a financial institution. In conjunction with these agreements, the Company issued warrants to purchase up to 3,958 shares of common stock at $ 9.00 per share within 10 years of issuance. All of these warrants expired during 2016 . In connection with the amendment to the debt agreements in 2009, the Company issued warrants to purchase up to 7,500 shares of common stock at $ 17.00 per share that expire in July 2019 . All of these warrants were outstanding and exercisable as of December 31, 2016 and 2015 . (e) Share Repurchases On May 13, 2010, the Company announced a share repurchase program to purchase up to $ 10 million of its common stock pursuant to Rule 10b-18 of the Securities Act. In January 2011, April 2012, January 2013, January 2015, and January 2016, the Company's Board of Directors replaced the prior authorizations with new $ 10 million authorizations for repurchases and retirement of the Company's outstanding common stock. The Company repurchased 529,312 shares, 829,003 shares and 881,810 shares of common stock for approximately $2.5 million , $5.3 million , and $4.3 million during the years ended December 31, 2016 , 2015 and 2014 , respectively. (f) Cumberland Emerging Technologies In April 2014, the Company received approximately $1 million from Gloria for its participation in CET. As a result, Gloria received shares in CET and will have the first right to negotiate a license to CET developed products for the Chinese market. Prior to April 2014, Cumberland owned 85% of CET, with the balance of the enterprise being owned by Vanderbilt University and the Tennessee Technology Development Corporation. In connection with Gloria’s investment in CET, the Company also provided an additional investment in CET. Cumberland contributed $1.0 million in cash and provided $2.4 million in loan forgiveness to CET in exchange for newly issued shares. Upon completion of the additional investment by Gloria and Cumberland in April 2014, the Company’s ownership in CET is 80% . As CET is a consolidated subsidiary, the Company reports the operating results of CET and allocates the noncontrolling interests to the non-majority partners. |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Earnings (loss) per Share | Earnings (Loss) Per Share The following table shows the computation of the numerator and the denominator used to calculate diluted earnings (loss) per share for the years ended December 31: 2016 2015 2014 Numerator: Net income (loss) attributable to common shareholders $ (944,683 ) $ 731,351 $ 2,423,723 Denominator: Weighted-average shares outstanding – basic 16,236,525 16,715,970 17,617,765 Dilutive effect of restricted stock and stock options — 378,784 281,867 Weighted-average shares outstanding – diluted 16,236,525 17,094,754 17,899,632 The Company's anti-dilutive restricted shares and stock options outstanding were as follows for the years ended December 31: 2016 2015 2014 Anti-dilutive shares 13,300 46,633 194,237 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The components of the Company's net deferred tax assets at December 31 are as follows: 2016 2015 Deferred Tax Assets Net operating loss and tax credits $ 3,881,415 $ 2,274,994 Property and equipment and intangibles 331,301 326,499 Allowance for accounts receivable 170,733 145,200 Reserve for expired product 771,034 849,579 Inventory 214,654 1,154,507 Deferred charges 738,541 660,973 Cumulative compensation costs incurred on deductible equity awards 639,263 1,675,757 Total deferred tax assets 6,746,941 7,087,509 Deferred Tax Liabilities Intangible assets (3,238,511 ) (3,162,502 ) Net deferred tax assets, before valuation allowance 3,508,430 3,925,007 Less: deferred tax asset valuation allowance (388,500 ) (185,497 ) Net deferred tax assets $ 3,119,930 $ 3,739,510 The following table summarizes the amount and year of expiration of the Company's federal and state net operating loss carryforwards as of December 31, 2016 : Years of expiration Federal State 2017 - 2019 $ — $ 454,898 2020 - 2028 — 38,884,460 2029 44,149,007 10,489,653 2030 - 2036 6,008,921 5,061,020 Total federal and state net operating loss carryforwards $ 50,157,928 $ 54,890,031 The Company has total recognized carryforward tax assets of $0.2 million for foreign tax credits and AMT carryforwards. In addition, the Company has recognized as of December 31, 2016 federal Orphan Drug and Research and Development tax credits of $1.2 million that expire between 2021 and 2036. These credits include approximately $0.2 million that is subject to a valuation allowance at December 31, 2016 . The Company has unrecognized federal net operating loss carryforwards as a result of the exercise of nonqualified options of approximately $ 44.1 million . These benefits occurred as a result of the actual tax benefit realized upon an employee's exercise exceeding the cumulative book compensation charge associated with the awards and will be recognized in the year in which they are able to reduce current income taxes payable. Accordingly, deferred tax assets are not recognized for these net operating loss carryforwards or credit carryforwards resulting from the exercise of nonqualified options. The Company has $54.9 million of state net operating loss carryforwards. This amount includes $ 45.4 million from the exercise of nonqualified options during 2009 and 2015. The state net operating loss carryforwards above include approximately $ 4.2 million that is subject to a valuation allowance at December 31, 2016 . Income tax (expense) benefit includes the following components for the years ended December 31: 2016 2015 2014 Current: Federal $ 867,041 $ (41,326 ) $ (1,440,010 ) State and other 83,463 (44,276 ) (250,064 ) Total current income tax (expense) benefit 950,504 (85,602 ) (1,690,074 ) Deferred: Federal (537,965 ) (385,723 ) 213,552 State (81,615 ) (104,504 ) 95,778 Total deferred income tax (expense) benefit (619,580 ) (490,227 ) 309,330 Total income tax (expense) benefit $ 330,924 $ (575,829 ) $ (1,380,744 ) Deferred income tax is comprised of the following components for the years ended December 31: 2016 2015 2014 Deferred tax (expense) benefit, excluding items below $ 4,803 $ 26,193 $ 85,844 Inventory (939,853 ) (257,970 ) (83,418 ) Operating loss carryforwards 1,537,003 34,465 17,424 Tax credit carryforwards 69,418 35,272 43,398 Valuation allowance due to changes in net deferred tax asset balances (203,003 ) (33,405 ) (20,457 ) Deductible equity awards (1,036,494 ) (972 ) 298,039 Allowance for accounts receivable 25,532 (26,808 ) (63,438 ) Deferred charges 77,567 (59,028 ) 838,556 Reserve for expired product (78,544 ) 31,784 217,330 Intangible assets (76,009 ) (239,758 ) (1,023,948 ) Deferred income tax (expense) benefit $ (619,580 ) $ (490,227 ) $ 309,330 The valuation allowance at December 31, 2016 is primarily related to federal tax credits, which will expire in 2021, and state tax benefits at CET and CPSC that will likely not be realized. The Company’s effective income tax rate for 2016 , 2015 and 2014 reconciles with the federal statutory tax rate as follows: 2016 2015 2014 Federal tax expense at statutory rate 34 % 34 % 34 % State income tax expense (net of federal income tax benefit) 4 % 4 % 5 % Permanent differences associated with general business credits 5 % (3 )% (1 )% Change in valuation allowance (15 )% 3 % 1 % Other permanent differences (2 )% 7 % 1 % Other (1 )% 1 % (3 )% Net income tax expense 25 % 46 % 37 % During 2012, the Company’s 2009 federal tax return was examined with no significant findings or adjustments. Federal tax years that remain open to examination are 2010 through 2015. Due to a 2009 net operating loss carryback, federal tax years 2006 through 2008 remain open to the extent of net operating losses utilized in those years. State tax years that remain open to examination are 2008 to 2015. The Company has no unrecognized tax benefits in 2016 , 2015 and 2014 . Excluding the alternative minimum tax (AMT) tax credits, the Company will need to generate future taxable income in order to realize its deferred tax assets. Based upon the level of taxable income over the last three years and projections for future taxable income over the periods in which the deferred tax assets are deductible, management believes it is more likely than not that the Company will realize the benefits of these deductible differences, net of the existing valuation allowances at December 31, 2016 . The amount of deferred tax assets considered realizable, however, could be reduced in the future periods if estimates of future taxable income during the carryforward period are reduced. |
Stock-Based Compensation Plans
Stock-Based Compensation Plans | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation Plans | Stock-Based Compensation Plans The Company has grants outstanding under three equity compensation plans, with two of the plans available for future grants of equity compensation awards to employees, consultants and directors. All of the equity plans were approved by shareholders. The 2007 Long-Term Incentive Compensation Plan (the 2007 Plan) and the 2007 Directors’ Incentive Plan (the "Directors’ Plan") superseded the 1999 Stock Option Plan. The 2007 Plan and the Directors’ Plan provide for the issuance of stock options, stock appreciation rights and restricted stock. Vesting is determined on a grant-by-grant basis in accordance with the terms of the plans and the related grant agreements. The Company has reserved 2.4 million shares of common stock for issuance under the 2007 Plan and 250,000 shares for issuance under the Directors’ Plan. The exercise price of stock options is generally 100% of the fair market value of the underlying common stock on the grant date. The exercise price of incentive stock options granted to a shareholder who owns more than 10% of the total combined voting power of all classes of stock must be at least 110% of the fair market value of the underlying common stock on the grant date. The maximum contractual term of stock options is ten years from the date of grant, except for incentive stock options granted to 10% shareholders, which is five years . During 2011, the Company began issuing shares of restricted stock with no exercise price to employees and directors. Restricted stock issued to employees generally cliff-vests on the fourth anniversary of the date of grant. Restricted stock issued to directors vests on the one year anniversary of the date of grant. Stock compensation expense is presented as a component of general and administrative expense in the consolidated statements of operations. Stock compensation expense recorded as a component of equity consisted of the following for the years ended December 31: 2016 2015 2014 Share-based compensation - employees $ 833,027 $ 456,749 $ 660,963 Share-based compensation - nonemployees 19,075 165,754 99,931 Total share-based compensation $ 852,102 $ 622,503 $ 760,894 At December 31, 2016 , there was approximately $ 1.7 million of unrecognized compensation cost related to share-based payments, which is expected to be recognized over a weighted-average period of 2.5 years. This amount relates primarily to unrecognized compensation cost for employees. Stock Options Stock option activity for 2016 and 2015 was as follows: Number of shares Weighted-average exercise price per share Weighted- average remaining contractual term (years) Aggregate intrinsic value Outstanding, December 31, 2014 158,356 $ 7.62 0.4 $ 2,320 Options granted — — Options exercised (5,652 ) 5.75 Options forfeited or expired (140,404 ) 7.41 Outstanding, December 31, 2015 12,300 10.89 1.6 — Options granted — — Options exercised — — Options forfeited or expired (6,500 ) 9.00 Outstanding, December 31, 2016 5,800 13.00 1.9 $ — Exercisable at December 31, 2016 5,800 $ 13.00 1.9 $ — The Company did not grant any stock options during 2016 , 2015 and 2014 , and no options were exercised during 2016 and 2014 . Information related to the stock option plans during 2016 , 2015 and 2014 was as follows: 2016 2015 2014 Intrinsic value of options exercised $ — $ 3,875 $ — Weighted-average fair value of options exercised $ — $ 3.26 $ — Restricted Stock Awards As previously noted, the Company began issuing restricted stock to employees and directors in 2011 under the provisions of the 2007 Plan and the Directors’ Plan. Restricted stock issued to employees generally cliff-vests on the fourth anniversary of the date of grant. Restricted stock issued to directors vests on the one-year anniversary of the date of grant. Restricted stock activity was as follows: Number of shares Weighted- average grant-date fair value Nonvested, December 31, 2014 692,837 $ 4.92 Shares granted 225,661 6.72 Shares vested (81,270 ) 5.22 Shares forfeited (97,179 ) 5.49 Nonvested, December 31, 2015 740,049 5.36 Shares granted 228,425 4.36 Shares vested (223,987 ) 5.28 Shares forfeited (41,192 ) 4.23 Nonvested, December 31, 2016 703,295 5.13 The fair value of restricted stock granted was based on the closing market price of the Company’s common stock on the date of grant. The restricted stock grants are included in the diluted weighted shares outstanding computation until they cliff-vest. Once vested they are included in the basic weighted shares outstanding computation. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2016 | |
Compensation and Retirement Disclosure [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans The Company sponsors an employee benefit plan that was established on January 1, 2006, the Cumberland Pharmaceuticals 401(k) Plan (the Plan), under Section 401(k) of the Internal Revenue Code of 1986, as amended, for the benefit of all employees over the age of 21 , having been employed by the Company for at least six months . The Plan provides that participants may contribute up to the maximum amount of their compensation as set forth by the Internal Revenue Service each year. Employee contributions are invested in various investment funds based upon elections made by the employees. During 2016 , 2015 and 2014 , the Company contributed approximately $ 50,000 in each year to the Plan as an employer match of participant contributions. In 2012 and 2013, the Company established non-qualified unfunded deferred compensation plans that allow participants to defer receipt of a portion of their compensation. The liability under the plans was $1.2 million and $ 0.7 million as of December 31, 2016 and 2015 , respectively. The Company had assets consisting of company-owned life insurance contracts generally designated to pay benefits of the deferred compensation plans of $1.9 million and $ 1.8 million as of December 31, 2016 and 2015 , respectively. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2016 | |
Leases [Abstract] | |
Leases | Leases The Company is obligated under long-term real estate leases for corporate office space that was extended during the third quarter of 2015. Prior to this extension, the lease would have expired in October 2016, the lease is now set to expire in October 2022. In addition, the research lab space at CET, under an agreement amended in July 2012, is leased through 2018, with an option to extend the lease through April 2028. The Company also subleases a portion of the space under these leases. Rent expense is recognized over the expected term of the lease, including renewal option periods, if applicable, on a straight-line basis. Rent expense for 2016 , 2015 , and 2014 was approximately $ 1.2 million , $ 1.0 million and $ 1.0 million , respectively, and sublease income was approximately $ 0.6 million , $ 0.6 million and $ 0.5 million . Cumulative future minimum sublease income under noncancelable operating subleases totals approximately $ 0.9 million and will be paid through the leases ending in February 2019, March 2019, and October 2022. Future minimum lease payments under noncancelable operating leases (with initial or remaining lease terms in excess of one year) are as follows: Year ending December 31: 2017 $ 1,039,618 2018 901,568 2019 838,896 2020 856,084 2021 and thereafter 1,612,969 Total future minimum lease payments $ 5,249,135 |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company owns marketable securities that are solely classified as trading securities as of December 31, 2016 . There were no transfers of assets between levels within the fair value hierarchy. The following table summarizes the fair value of these marketable securities by level within the fair value hierarchy: December 31, 2016 December 31, 2015 Level 1 Level 2 Total Level 1 Level 2 Total U.S. Agency issued mortgage-backed securities - variable rate $ — $ 6,814,957 $ 6,814,957 $ — $ 5,700,335 $ 5,700,335 U.S. Agency notes and bonds - fixed rate — 1,795,330 1,795,330 — 2,447,066 2,447,066 SBA loan pools - variable rate — 1,346,824 1,346,824 — 1,681,714 1,681,714 Municipal bonds - VRDN 5,665,000 — 5,665,000 4,735,000 — 4,735,000 Total fair value of marketable securities $ 5,665,000 $ 9,957,111 $ 15,622,111 $ 4,735,000 $ 9,829,115 $ 14,564,115 The fair values of all other financial instruments outstanding as of December 31, 2016 and 2015 approximate their carrying values. There were no changes to the valuation techniques for the Level 2 marketable securities during 2016 or 2015 . |
Market Concentrations
Market Concentrations | 12 Months Ended |
Dec. 31, 2016 | |
Risks and Uncertainties [Abstract] | |
Market Concentrations | Market Concentrations The Company currently focuses on acquiring, developing, and commercializing branded prescription products for the acute care and gastroenterology markets. The Company’s principal financial instruments subject to potential concentration of credit risk are accounts receivable, which are unsecured, and cash equivalents. The Company’s cash equivalents consist primarily of money market funds. Certain bank deposits may at times be in excess of the insurance limits provided by the Federal Deposit Insurance Corporation. The Company’s primary customers are wholesale pharmaceutical distributors in the U.S. Total gross revenues by customer for each customer representing 10% or more of consolidated gross revenues are summarized below for the years ended December 31: 2016 2015 2014 Customer 1 22% 22% 21% Customer 2 28% 28% 27% Customer 3 29% 32% 34% Customer 4 10% 9% 11% The Company’s accounts receivable, net of allowances, due from these four customers at December 31, 2016 and 2015 was 86% and 71% , respectively. |
Manufacturing and Supply Agreem
Manufacturing and Supply Agreements | 12 Months Ended |
Dec. 31, 2016 | |
Manufacturing and Supply Agreements [Abstract] | |
Manufacturing and Supply Agreements | Manufacturing and Supply Agreements The Company utilizes one or two primary suppliers to manufacture each of its products and product candidates. Although there are a limited number of manufacturers of pharmaceutical products, the Company believes it could utilize other suppliers to manufacture its prescription products on comparable terms. A change in suppliers, problems with its third-party manufacturing operations or related production capacity, or contract disputes with suppliers could cause a delay in manufacturing or shipment of finished goods and possible loss of sales, which could adversely affect operating results. |
Employment Agreements
Employment Agreements | 12 Months Ended |
Dec. 31, 2016 | |
Employment Agreements [Abstract] | |
Employment Agreements | Employment Agreements The Company has entered into employment agreements with all its full-time employees. Each employment agreement provides for a salary for services performed, a potential annual bonus and, if applicable, a grant of restricted common shares pursuant to a restricted stock agreement. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Commitments In connection with the acquisition of certain Kristalose assets during 2011, the Company is required to make quarterly payments based on a percentage of Kristalose net sales through November 2018. The payments are being treated as consideration for the assets acquired, and are being capitalized and amortized over the remaining expected useful life of the acquired asset, currently through 2026. In connection with its licensing agreements for Caldolor and Ethyol, the Company is required to pay royalties based on Caldolor net sales and Ethyol net sales over the life of the contracts. Royalty expense is recognized as a component of selling and marketing expense in the period that revenue is recognized. As discussed in Note 3, in connection with the agreements with Pernix and GEL to promote Omeclamox-Pak, the Company is required to make monthly royalty payments based on tiered levels of gross profits. These costs are period expenses of the Company. Legal Matters In April 2012, the United States Patent and Trademark Office (the “USPTO”) issued U.S. Patent number 8,148,356 (the “356 Acetadote Patent”) to the Company. The claims of the 356 Acetadote Patent encompasses the Acetadote formulation and includes composition of matter claims. Following its issuance, the 356 Acetadote Patent was listed in the FDA Orange Book. The 356 Acetadote Patent is scheduled to expire in May 2026, which time period includes a 270-day patent term adjustment granted by the USPTO. Following the issuance of the 356 Acetadote Patent, the Company received separate Paragraph IV certification notices from InnoPharma, Inc. ("InnoPharma"), Paddock Laboratories, LLC (“Paddock”), Mylan Institutional LLC (“Mylan”), Sagent Agila LLC ("Sagent") and Perrigo Company ("Perrigo") challenging the 356 Acetadote Patent on the basis of non-infringement and/or invalidity. The Company responded by filing five separate infringement lawsuits, in the appropriate United States District Courts, to contest each of the challenges. On November 12, 2012, the Company entered into a Settlement Agreement (the “Settlement Agreement”) with Paddock and Perrigo to resolve the challenges and the pending litigation with those two companies. On November 1, 2013, the United States District Court filed opinions granting Sagent’s and InnoPharma’s motions to dismiss the Company's suits. In November the Company agreed not to file an appeal or motion to reconsider and thereby resolving the challenges and the pending litigation with those two companies. Under the Settlement Agreement, Paddock and Perrigo admit that the 356 Acetadote Patent is valid and enforceable and that any Paddock or Perrigo generic Acetadote product (with or without EDTA) would infringe upon the 356 Acetadote Patent. In addition, Paddock and Perrigo will not challenge the validity, enforceability, ownership or patentability of the 356 Acetadote Patent through its expiration currently scheduled for May 2026. On November 12, 2012, in connection with the execution of the Settlement Agreement, Cumberland entered into a License and Supply Agreement with Paddock and Perrigo (the “License and Supply Agreement”). Under the terms of the License and Supply Agreement, once a third party receives final approval from the FDA for an ANDA to sell a generic Acetadote product and such third party made such generic version available for purchase in commercial quantities in the United States, the Company supply's Perrigo with an Authorized Generic version of its Acetadote product (the “Authorized Generic”). On May 18, 2012, Cumberland also submitted a Citizen Petition to the FDA requesting that the FDA refrain from approving any applications for acetylcysteine injection that contain EDTA, based in part on the FDA's request that the Company evaluate the reduction or removal of EDTA from its original Acetadote formulation. On November 7, 2012, the FDA responded to the Citizen Petition denying its request and on November 8, 2012, the Company learned that the FDA approved the ANDA referencing Acetadote filed by InnoPharma, Inc. Cumberland brought suit against the FDA contesting the FDA's decision to approve the InnoPharma generic on November 13, 2012. On September 30, 2013, the United States District Court filed an opinion granting a summary judgment in favor of the FDA regarding this suit. As noted above, during 2012 the FDA approved the ANDA referencing Acetadote filed by InnoPharma, Inc. Upon this condition, in accordance with the License and Supply agreement with Perrigo, the Company began to supply Perrigo with its Authorized Generic. On January 7, 2013, Perrigo announced initial distribution of Cumberland's Authorized Generic acetylcysteine injection product. On March 19, 2013, the USPTO issued U.S. Patent number 8,399,445 (the “445 Acetadote Patent”) which is assigned to Cumberland. The claims of the 445 Acetadote Patent encompass the use of the 200 mg/ml Acetadote formulation to treat patients with acetaminophen overdose. On April 8, 2013, the 445 Acetadote Patent was listed in the FDA Orange Book. The 445 Acetadote Patent is scheduled to expire in August 2025. Following the issuance of the 445 Acetadote Patent Cumberland received separate Paragraph IV certification notices from Perrigo, Sagent Pharmaceuticals, Inc., and Mylan Institutional LLC challenging the 445 Acetadote Patent on the basis of non-infringement, unenforceability and/or invalidity. On June 10, 2013, The Company became aware of a Paragraph IV certification notice from Akorn, Inc. challenging the 445 Acetadote Patent and the 356 Acetadote Patent on the basis of non-infringement. On July 12, 2013, Cumberland filed a lawsuit for infringement of the 356 Acetadote Patent against Akorn, Inc. in United States District Court. On February18, 2014, the USPTO issued U.S. Patent number 8,653,061 (the “061 Acetadote Patent”) which is assigned to the Company. The claims of the 061 Acetadote Patent encompass the use of the 200 mg/ml Acetadote formulation to treat patients with acetaminophen overdose. Following its issuance, the 061 Acetadote Patent was listed in the FDA Orange Book. The 061 Acetadote Patent is scheduled to expire in August 2025. On May 13, 2014, the USPTO issued U.S. Patent number 8,722,738 (the “738 Acetadote Patent”) which is assigned to Cumberland. The claims of the 738 Acetadote Patent encompass administration methods of acetylcysteine injection, without specification of the presence or lack of EDTA in the injection. Following its issuance, the 738 Acetadote Patent was listed in the FDA Orange Book and it is scheduled to expire in April 2032. On December 11, 2014 and March 3, 2015, the Company became aware of Paragraph IV certification notices from Aurobindo Pharma Limited and Zydus Pharmaceuticals (USA) Inc., respectively, challenging the 356, 445, 061, and 738 Acetadote Patents on the basis of non-infringement. On February 10, 2015, the USPTO issued U.S. Patent number 8,952,065 (the “065 Acetadote Patent”) which is assigned to us. The claims of the 065 Acetadote Patent encompass the use of the 200 mg/ml Acetadote formulation to treat patients with acute liver failure. The 065 Acetadote Patent is scheduled to expire in August 2025. On September 30, 2015, the United States District Court for the Northern District of Illinois, Eastern Division ("District Court") ruled in our favor in our lawsuit against Mylan for infringement of the 445 Acetadote Patent. The opinion upheld our 445 Acetadote Patent and expressly rejected Mylan's validity challenge. The District Court ruled that Mylan is liable to us for infringement of the 445 Acetadote patent in light of Mylan's Abbreviated New Drug Application in which Mylan sought to market a generic version of Acetadote. On November 17, 2015, the District Court entered an order enjoining Mylan and its affiliates from selling or using its generic version of Acetadote until August 2025, the date of expiration of the 445 Acetadote Patent. On October 30, 2015, Mylan filed a notice of appeal to the U.S. Court of Appeals for the Federal Circuit (the "Appeals Court"). On May 3, 2016, the USPTO issued U.S. Patent number 9,327,028 (the “028 Acetadote Patent”) which is assigned to us. The claims of the 028 Acetadote Patent encompass administration methods of acetylcysteine injection, without specification of the presence or lack of EDTA in the injection. Following its issuance, the 028 Acetadote Patent was listed in the FDA Orange Book and it is scheduled to expire in July 2031. On January 26, 2017, the Appeals Court affirmed the District Court ruling in the Company's favor in its lawsuit against Mylan for infringement of the 445 Acetadote Patent. The Appeals Court opinion affirmed the District Court’s ruling upholding Cumberland's 445 Acetadote Patent and expressly rejected Mylan's validity challenge. The Company continues to consider its legal options and intends to continue to vigorously defend and protect its Acetadote product and related intellectual property rights. The Company is a party to various other legal proceedings in the ordinary course of its business. In the opinion of management, the liability associated with these matters, other than the issue concerning the Company's Acetadote patents discussed above, will not have a material adverse effect on the Company's consolidated financial position, results of operations or cash flows. |
Quarterly Financial Information
Quarterly Financial Information (Unaudited) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information (Unaudited) | Quarterly Financial Information (Unaudited) The following table sets forth the unaudited operating results for each fiscal quarter of 2016 and 2015 : First Quarter Second Quarter Third Quarter Fourth Quarter Total 2016: Net revenues $ 7,737,532 $ 7,414,835 $ 8,791,753 $ 9,081,440 $ 33,025,560 Operating income (loss) (500,583 ) (105,309 ) 130,132 (957,371 ) (1,433,131 ) Net income (loss) attributable to common shareholders (253,111 ) (48,044 ) 106,166 (749,694 ) (944,683 ) Earnings (loss) per share attributable to common shareholders (1) Basic $ (0.02 ) $ — $ 0.01 $ (0.05 ) $ (0.06 ) Diluted $ (0.02 ) $ — $ 0.01 $ (0.05 ) $ (0.06 ) 2015: Net revenues $ 8,686,774 $ 8,909,741 $ 7,885,048 $ 8,037,488 $ 33,519,051 Operating income 4,116 673,931 270,884 162,679 1,111,610 Net income attributable to common shareholders 46,281 407,398 126,613 151,059 731,351 Earnings per share attributable to common shareholders (1) Basic $ — $ 0.02 $ 0.01 $ 0.01 $ 0.04 Diluted $ — $ 0.02 $ 0.01 $ 0.01 $ 0.04 (1) Due to the nature of interim earnings per share calculations, the sum of the quarterly earnings (loss) per share amounts may not equal the reported earnings (loss) per share for the full year. |
Valuation and Qualifying Accoun
Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2016 | |
Valuation and Qualifying Accounts [Abstract] | |
Valuation and Qualifying Accounts | Valuation and Qualifying Accounts Years ended December 31, 2016 , 2015 and 2014 Description Balance at beginning of period Charged to costs and expenses Charged to other accounts Deductions Balance at end of period Allowance for uncollectible amounts, cash discounts, chargebacks, and credits issued for damaged products: For the years ended December 31: 2014 $ 593,116 $ 5,166,568 $ — $ (5,321,327 ) (1) $ 438,357 2015 438,357 3,903,285 — (3,960,402 ) (1) 381,240 2016 381,240 3,755,804 — (3,687,185 ) (1) 449,859 Valuation allowance for deferred tax assets: For the years ended December 31: 2014 $ 131,617 $ 20,457 $ — $ — $ 152,074 2015 152,074 33,423 — — 185,497 2016 185,497 203,003 — — 388,500 (1) Composed of actual returns and credits for chargebacks and cash discounts. |
Significant Accounting Polici29
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements of the Company are stated in U.S. dollars and are prepared using U.S. generally accepted accounting principles. These financial statements include the accounts of the Company and its wholly and majority-owned subsidiaries. All significant intercompany transactions and accounts have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements in conformity with U.S. generally accepted accounting principles require management of the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates under different assumptions and conditions. |
Segment Reporting | Segment Reporting The Company has one operating segment which is specialty pharmaceutical products. Management has chosen to organize the Company based on the type of products sold. Operating segments are identified as components of an enterprise about which separate discrete financial information is evaluated by the chief operating decision maker, or decision-making group, in making decisions regarding resource allocation and assessing performance. The Company, which uses consolidated financial information in determining how to allocate resources and assess performance, evaluated that our specialty pharmaceutical products compete in similar economic markets and similar circumstances. Substantially all of the Company’s assets are located in the United States. Total revenues are primarily attributable to U.S. customers. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value of financial assets and liabilities is the price the Company would receive to sell an asset or pay to transfer a liability in an orderly transaction with a market participant at the measurement date. The Company's fair value measurements follow the appropriate rules as well as the fair value hierarchy that prioritizes the information used to develop the measurements. It applies whenever other guidance requires (or permits) assets or liabilities to be measured at fair value and gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). A summary of the fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels is described below: Level 1 - Quoted prices for identical instruments in active markets. Level 2 - Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. Level 3 - Significant inputs to the valuation model are unobservable. We maintain policies and procedures to value instruments using the best and most relevant data available. The following section describes the valuation methodologies we use to measure different financial instruments at fair value on a recurring basis. The Company’s financial instruments include cash and cash equivalents, marketable securities, accounts receivable, accounts payable, accrued liabilities, and a revolving line of credit. The carrying values for cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their fair values due to their short-term nature. The revolving line of credit has a variable interest rate, which approximates the current market rate. The Company's fair values of marketable securities are determined based on valuations provided by a third-party pricing service, as derived from such services' pricing models, and are considered either Level 1 or Level 2 measurements, depending on the nature of the investment. The Company has no marketable securities in which the fair value is determined based on Level 3. The level of management judgment required in evaluating fair value for Level 1 investments is minimal. Similarly, there is little subjectivity or judgment required for Level 2 investments valued using valuation models that are standard across the industry and whose parameter inputs are quoted in active markets. Inputs to the models may include, but are not limited to, reported trades, executable bid and ask prices, broker/dealer quotations, prices or yields of securities with similar characteristics, benchmark curves or information pertaining to the issuer, as well as industry and economic events. Based on the information available, the Company believes that the valuations provided by the third-party pricing service, as derived from such services' pricing models, are representative of prices that would be received to sell the assets at the measurement date (exit prices). |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents include highly liquid investments with original maturities of three months or less. As of December 31, 2016 and 2015 , cash equivalents consist primarily of money market funds. |
Marketable Securities | Marketable Securities The Company invests in marketable debt securities in order to maximize its return on cash. Marketable securities consist of U.S. Treasury notes and bonds, U.S. Government Agency notes and bonds and bank-guaranteed, variable rate demand notes (VRDN). At the time of purchase, the Company classifies marketable securities as either trading securities or available-for-sale securities, depending on the intent at that time. As of December 31, 2016 and 2015 , marketable securities were comprised solely of trading securities. Trading securities are carried at fair value with unrealized gains and losses recognized as a component of interest income in the consolidated statements of operations. |
Accounts Receivable | Accounts Receivable Trade accounts receivable are recorded at the invoiced amount. The Company records allowances for amounts that could become uncollectible in the future based on historical experience, including amounts related to chargebacks, cash discounts and credits for damaged product. The Company reviews each customer balance to assess collectibility. The majority of the Company’s products are distributed through independent pharmaceutical wholesalers. Net product revenues and accounts receivable take into account the sale of the product at the wholesale acquisition cost, and an accrual is recorded to reflect the difference between the wholesale acquisition cost and the estimated average end-user contract price. This accrual is calculated on a product-specific basis and is based on the estimated number of outstanding units sold to wholesalers that will ultimately be sold in end-user contracts. When the wholesaler sells the product to the end-user at the agreed upon end-user contract price, the wholesaler charges the Company for the difference between the wholesale acquisition price and the end-user contract price and this chargeback is offset against the initial accrual balance. Cash discounts are reductions to invoiced amounts offered to customers for payment within a specified period of time from the date of the invoice. At the time a transaction is recognized as a sale, the Company records a reduction in revenues for an estimate of damaged product in the shipment. The Company’s estimate of the allowance for damaged product is based upon historical experience of claims made for damaged product. |
Inventories | Inventories The Company works closely with third parties to manufacture and package finished goods for sale. Based on the customer relationship with the manufacturer or packager, the Company will either take title to finished goods at the time of shipment or at the time of arrival from the manufacturer. The Company then warehouses such goods until distribution and sale. Inventories are stated at the lower of cost or market with cost determined using the first-in, first-out method. The Company continually evaluates inventories for potential losses due to excess, obsolete or slow-moving inventory by comparing sales history and sales projections to the inventory on hand. When evidence indicates the carrying value of a product may not be recoverable, a charge is recorded to reduce the inventory to its current net realizable value. |
Prepaid and Other Current Assets | Prepaid and Other Current Assets Prepaid and other current assets consist of the current portion of unamortized deferred financing costs, prepaid insurance premiums, prepaid consulting services and annual fees paid to the U.S. Food and Drug Administration ("FDA"). The Company expenses all prepaid amounts as used or over the period of benefit primarily on a straight-line basis, as applicable. |
Property and Equipment | Property and Equipment Property and equipment, including leasehold improvements, are stated at cost. Depreciation is recognized using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the shorter of the initial lease term plus renewal options, if reasonably assured, or the remaining useful life of the asset. Upon retirement or disposal of assets, any gain or loss is reflected as a component of operating income in the consolidated statement of operations. Improvements that extend an asset’s useful life are capitalized. Repairs and maintenance costs are expensed as incurred. |
Intangible Assets | Intangible Assets The Company’s intangible assets consist of capitalized costs related to product and license rights, patents and trademarks. The cost of acquiring product and license rights are capitalized at fair value at the date of acquisition for products that are approved by the FDA for commercial use. These costs are amortized ratably over the estimated economic life of the product. The economic life is estimated based upon the term of the license agreement, patent life or market exclusivity of the product and based on management's assessment of future sales and profitability of the product. This estimate is evaluated on a regular basis during the amortization period and adjusted if appropriate. If there are any changes made to the useful life of the product and license rights, the costs associated with such a change, if any, will be capitalized and amortized over the revised useful life. Capitalized patent costs consist of outside legal costs associated with obtaining and protecting patents on products that have been approved for marketing by the FDA. If it becomes probable that a patent will not be issued or a patent has been declared invalid, related costs associated with the patent application are expensed at the time such determination is made. All costs associated with obtaining patents for products that have not been approved for marketing by the FDA are expensed as incurred. Amortization expense is recognized ratably over the following periods: Product rights Estimated economic life License rights Term of license agreement Patents Life of patent |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets Long-lived assets, such as property and equipment and intangible assets subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. If events or circumstances arise that require a long-lived asset to be tested for potential impairment, the Company first compares undiscounted cash flows expected to be generated by the asset to its carrying value. If the carrying amount of the long-lived asset is not recoverable on an undiscounted cash flow basis, an impairment charge is recognized to the extent that the carrying value exceeds the fair value. Fair value is determined through various valuation techniques including quoted market prices, third-party independent appraisals and discounted cash flow models. |
Revenue Recognition | Revenue Recognition Revenue is realizable and earned when all of the following criteria are met: persuasive evidence of an arrangement exists; delivery has occurred or services have been rendered; the seller’s price to the buyer is fixed and determinable; and collectibility of the related receivable is reasonably assured. Delivery is considered to have occurred upon either shipment of the product or arrival at its destination, depending upon the shipping terms of the transaction. Product Revenues The Company’s net product revenue reflects the reduction from gross product revenue for estimated allowances for chargebacks, discounts and damaged goods, and reflects sales related accruals for rebates, product returns, and certain administrative and service fees. As discussed above, the allowances against accounts receivable for chargebacks, discounts and damaged goods are determined on a product-by-product basis, and established by management as the Company’s best estimate at the time of sale based on each product’s historical experience adjusted to reflect known changes in the factors that impact such allowances. These allowances are established based on the contractual terms with direct and indirect customers and analyses of historical levels of chargebacks, discounts and credits claimed for damaged product. Other organizations, such as managed care providers, pharmacy benefit management companies and government agencies, may receive rebates from the Company based on either negotiated contracts to carry the Company’s products or reimbursements for filled prescriptions. These entities are considered indirect customers of the Company. In addition, the Company may provide rebates to end-user customers. In conjunction with recognizing a sale to a wholesaler, sales revenues are reduced and accrued liabilities are increased by the Company’s estimate of the rebate that may be claimed. Consistent with industry practice, the Company maintains a return policy that allows customers to return product within a specified period prior to and subsequent to the expiration date. The Company’s estimate of the provision for returns is based upon historical experience. Any changes in the assumptions used to estimate the provision for returns are recognized in the period those assumptions changed. The Company has agreements with certain key wholesalers that include a fee for service costs. These costs are netted against product revenues. Other Revenues Other revenues primarily consist of income from grant funding programs, licensing agreements, leases and contract services. Revenue related to grants is recognized when all conditions related to such grants have been met. All other revenue is recognized when earned. The Company is a party to several licensing arrangements to register and commercialize the Company's products in markets outside the U.S. Under these licensing arrangements, the third-party licensee has access to the Company's FDA registration dossier. Licensing arrangements typically include an up-front payment for gaining access to the dossier file, royalties and milestone payments upon the achievement of specific sales levels. The amounts received for access to the FDA registration file are evaluated and based on the evaluation, the resulting revenue is either recognized upfront or recognized over the term of the arrangement. Royalties and milestones are recognized as revenue when earned. For substantive milestones, the Company uses the milestone method of recognizing revenue if it is commensurate with either the performance to achieve the milestone or the enhancement of the value of the delivered item, it relates solely to past performance and it is reasonable relative to other milestones. |
Cost of Products Sold | Cost of Products Sold Cost of products sold consists principally of the cost to acquire each unit of product sold, including in-bound freight expense. Cost of products sold also includes expenses associated with the write-down of slow-moving or expired product. |
Selling and Marketing Expense | Selling and Marketing Expense Selling and marketing expense consists primarily of expenses relating to the advertising, promotion, distribution and sale of products, including royalty expense, salaries and related costs. |
Distribution Costs | Distribution Costs Distribution costs are expensed as incurred and totaled $ 0.7 million , $0.8 million , and $ 1.0 million in 2016 , 2015 and 2014 , respectively. They are included as a component of selling and marketing expenses in the consolidated statements of operations. |
Advertising Costs | Advertising Costs Advertising costs are expensed as incurred. These costs were $ 2.6 million , $ 2.6 million and $ 2.5 million in 2016 , 2015 and 2014 , respectively, and are included as a component of selling and marketing expenses in the consolidated statements of operations. |
Research and Development | Research and Development Research and development costs are expensed in the period incurred. Research and development costs are comprised mainly of clinical trial expenses, salaries, wages and other related costs such as materials and supplies. Development expense includes activities performed by third-party providers participating in the Company’s clinical studies. The Company accounts for these costs based on estimates of work performed, patients enrolled or fixed fees for services. |
Income Taxes | Income Taxes The Company provides for deferred taxes using the asset and liability approach. Under this method, deferred tax assets and liabilities are recognized for future tax consequences attributable to operating loss and tax credit carryforwards, as well as differences between the carrying amounts of existing assets and liabilities and their respective tax bases. The Company’s principal differences are related to the timing of deductibility of certain items, such as inventory, depreciation, amortization and share-based compensation. Deferred tax assets and liabilities are measured using enacted statutory tax rates that are expected to apply to taxable income in the years such temporary differences are anticipated to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period of enactment. The Company only recognizes income tax benefits associated with an income tax position in which it is “more likely than not” that the position would be sustained upon examination by the taxing authorities. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of existing temporary differences, projected future taxable income and tax planning strategies in making this assessment. The Company’s accounting policy with respect to interest and penalties arising from income tax settlements is to recognize them as part of the provision for income taxes |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Total comprehensive income (loss) was comprised solely of net income (loss) for all periods presented. |
Earnings (Loss) Per Share | Earnings (Loss) per Share Basic earnings per share is calculated by dividing net income attributable to common shareholders by the weighted-average number of shares outstanding. Except where the result would be antidilutive to income from continuing operations, diluted earnings per share is calculated by assuming the vesting of unvested restricted stock and the exercise of stock options and warrants, unrecognized compensation costs, as well as the related income tax benefits. |
Share-Based Payments | Share-Based Payments The Company recognizes compensation cost for all share-based payments issued, modified, repurchased or canceled. Depending on the nature of the vesting provisions, restricted stock awards are measured using either the fair value on the grant date or the fair value of common stock on the date the vesting provisions lapse. Prior to the lapse for those equity grants not valued on the grant date, the fair value is measured on the last day of the reporting period. |
Collaborative Agreements | Collaborative Agreements The Company is a party to several collaborative arrangements with certain research institutions to identify and pursue promising pre-clinical pharmaceutical product candidates. The Company has determined these collaborative agreements do not meet the criteria for accounting under Accounting Standards Codification 808, Collaborative Agreements. The agreements do not specifically designate each party's rights and obligations to each other under the collaborative arrangements. Except for patent defense costs, expenses incurred by one party are not required to be reimbursed by the other party. The funding for these programs is generally provided through private sector investments or federal Small Business Administration ("SBIR/STTR") grant programs. Expenses incurred under these collaborative agreements are included in research and development expenses in the consolidated statements of operations. Funding received from private sector investments and grants are recorded as net revenues in the consolidated statements of operations. |
Recent Accounting Guidance | Recent Accounting Guidance In November 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU"), “Statement of Cash Flows—Restricted Cash—a consensus of the FASB Emerging Issues Task Force.” This revised standard is an effort by the FASB to reduce existing diversity in practice by providing specific guidance on the presentation of restricted cash or restricted cash equivalents in the statement of cash flows. The updated guidance requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash and restricted cash equivalents. As such, amounts generally described as restricted cash and restricted cash equivalents should be included in the “beginning–of–period” and “end–of–period” total amounts shown on the statement of cash flows. The effective date for this standard is for years beginning after December 15, 2017, with early adoption permitted. The Company is evaluating the potential impact of this adoption on our condensed consolidated financial statements and disclosures. In August 2016, the FASB issued amended guidance in the form of a FASB ASU, "Classification of Certain Cash Receipts and Cash Payments." The core principle of the new guidance is to address eight specific cash flow issues with the objective of reducing the existing diversity in practice. The amendments in this update are effective for fiscal years beginning after December 15, 2017. The accounting guidance should be applied retrospectively and early adoption is permitted. The Company continues to evaluate the potential impact of this adoption on our condensed consolidated financial statements and disclosures but currently it does not anticipate that adoption will have a material impact. In May 2014, the FASB issued amended guidance in the form of a FASB ASU, "Revenue from Contracts with Customers." The core principle of the new guidance is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. The new guidance defines a five-step process to achieve this core principle and, in doing so, additional judgments and estimates may be required within the revenue recognition process. The new standard will replace most of the existing revenue recognition standards in U.S. GAAP when it becomes effective. In July 2015, the FASB issued a one-year deferral of the adoption date, which extended the effective date for the Company to January 1, 2018 at which point the Company will adopt the standard. The new standard can be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of the change recognized at the date of the initial application. The Company is assessing the appropriate method for implementing the ASU, as well as the impact the adoption of the ASU will have on its consolidated financial statements and footnote disclosures. In July 2015, the FASB issued amended guidance in the form of a FASB ASU, “Inventory: Simplifying the Measurement of Inventory.” The amended guidance requires entities to measure inventory at the lower of cost or net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The requirement would replace the current lower of cost or market evaluation. Accounting guidance is unchanged for inventory measured using last-in, first-out (“LIFO”) or the retail method. The amendments in this update are effective for fiscal years beginning after December 15, 2016. The accounting guidance should be applied prospectively and early adoption is permitted. The Company continues to evaluate the potential impact of this adoption on our condensed consolidated financial statements and disclosures but currently, it does not expect adoption to have a material impact. In November 2015, the FASB amended guidance in the form of a FASB ASU, "Balance Sheet Classification of Deferred Taxes," which requires that all deferred tax assets and liabilities be classified as noncurrent on the balance sheet instead of separating deferred taxes into current and noncurrent amounts. The FASB determined that this simplification could reduce cost and complexity without decreasing the usefulness of information provided to financial statement users. The amendments in this update are effective for fiscal years beginning after December 15, 2016. The Company has adopted this accounting guidance as of December 31, 2016 and applied retrospective disclosure to the comparison periods. In February 2016, the FASB issued guidance in the form of a FASB ASU, "Leases." The new standard establishes a right-of-use (ROU) model that requires a lessee to record an ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain optional practical expedients available. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company is evaluating its current lease agreements for the impact of its pending adoption of the new standard on its consolidated financial statements and disclosures. The Company's operating leases include the lease of approximately 25,500 square feet of office space in Nashville, Tennessee for its corporate headquarters with the lease expiring in October 2022. The CET lease of approximately 14,200 square feet of office and wet laboratory space in Nashville, Tennessee through April 2018 is also included to operate the CET Life Sciences Center. In March 2016, the FASB released in the form of a FASB ASU, "Compensation - Stock Compensation: Improvements to Employee Share-Based Payment Accounting." The ASU includes multiple provisions intended to simplify various aspects of the accounting for share-based payments. While aimed at reducing the cost and complexity of the accounting for share-based payments, the amendments are expected to significantly impact net income, earnings per share ("EPS"), and the statement of cash flows. Implementation and administration may present challenges for companies with significant share-based payment activities. The ASU is effective for public companies in annual periods beginning after December 15, 2016, and interim periods within those years. The Company is currently evaluating the impact of adoption on the consolidated financial statements including the unrecognized net operating loss carryforwards generated from the exercise of nonqualified options of approximately $44.1 million and the future vesting of shares of restricted stock issued to employees and directors. |
Significant Accounting Polici30
Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Schedule of intangible assets, useful lives | Amortization expense is recognized ratably over the following periods: Product rights Estimated economic life License rights Term of license agreement Patents Life of patent |
Vaprisol, Omeclamox-Pak, Ethy31
Vaprisol, Omeclamox-Pak, Ethyol, and Methotrexate (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Business Combinations [Abstract] | |
Schedule of fair value assets and liabilities assumed in acquisition | The following table summarizes the allocation of the fair value of the assets acquired and liabilities assumed as of the acquisition date for Vaprisol: Intellectual property intangible assets $ 2,990,000 Inventories 1,410,000 Acquired contingent liabilities (400,000 ) Contingent consideration obligation (2,000,000 ) Total net assets acquired $ 2,000,000 |
Revenues (Tables)
Revenues (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Revenues [Abstract] | |
Schedule of net product revenues by product | The Company’s net product revenues consisted of the following for the years ended December 31: 2016 2015 2014 Products: Acetadote $ 7,214,341 $ 8,489,167 $ 11,906,232 Omeclamox-Pak 2,536,027 3,037,078 4,111,916 Kristalose 15,898,760 15,733,327 14,932,271 Vaprisol 1,857,838 2,641,484 3,011,997 Caldolor 4,132,833 3,112,128 2,721,346 Ethyol 838,386 — — Total net product revenues $ 32,478,185 $ 33,013,184 $ 36,683,762 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Schedule of inventories, current | The Company's net inventories consisted of the following as of December 31: 2016 2015 Raw materials and work in process $ 2,810,711 $ 2,576,621 Consigned inventory 277,324 235,636 Finished goods 2,283,694 1,457,886 Total inventories $ 5,371,729 $ 4,270,143 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | Property and equipment consisted of the following at December 31: Range of useful lives 2016 2015 Computer equipment 3 – 5 years $ 933,752 $ 839,563 Office equipment 3 – 15 years 355,456 332,126 Furniture and fixtures 5 – 15 years 618,808 618,808 Leasehold improvements 3 – 15 years, or remaining lease term 1,256,378 1,243,025 Total property and equipment, gross 3,164,394 3,033,522 Less: accumulated depreciation and amortization (2,699,940 ) (2,497,072 ) Total property and equipment, net $ 464,454 $ 536,450 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets | Intangible assets consisted of the following at December 31: 2016 2015 Product and license rights $ 20,543,262 $ 18,011,362 Less: accumulated amortization (4,988,333 ) (3,541,305 ) Total product and license rights 15,554,929 14,470,057 Patents 8,844,994 8,236,719 Less: accumulated amortization (2,298,442 ) (1,551,430 ) Total patents 6,546,552 6,685,289 Trademarks 61,715 22,270 Less: accumulated amortization (9,020 ) (9,020 ) Total trademarks 52,695 13,250 Total intangible assets $ 22,154,176 $ 21,168,596 |
Schedule of expected amortization expense of intangible assets | The expected amortization expense for the Company's current balance of intangible assets are as follows: Year ending December 31: 2017 $ 2,320,093 2018 2,338,260 2019 2,392,760 2020 2,392,760 2021 and thereafter 12,710,303 $ 22,154,176 |
Other Current Liabilities (Tabl
Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Other Liabilities, Current [Abstract] | |
Schedule of accrued liabilities | Other current liabilities consisted of the following at December 31: 2016 2015 Rebates, product returns, administrative fees and service fees $ 4,051,029 $ 6,776,023 Employee wages and benefits 872,914 1,034,991 Other 1,831,709 1,723,254 Total other current liabilities $ 6,755,652 $ 9,534,268 |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of calculation of numerator and denominator in earnings per share | The following table shows the computation of the numerator and the denominator used to calculate diluted earnings (loss) per share for the years ended December 31: 2016 2015 2014 Numerator: Net income (loss) attributable to common shareholders $ (944,683 ) $ 731,351 $ 2,423,723 Denominator: Weighted-average shares outstanding – basic 16,236,525 16,715,970 17,617,765 Dilutive effect of restricted stock and stock options — 378,784 281,867 Weighted-average shares outstanding – diluted 16,236,525 17,094,754 17,899,632 |
Schedule of anti-dilutive securities excluded from computation of earnings per share | The Company's anti-dilutive restricted shares and stock options outstanding were as follows for the years ended December 31: 2016 2015 2014 Anti-dilutive shares 13,300 46,633 194,237 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of deferred tax assets and liabilities, net | The components of the Company's net deferred tax assets at December 31 are as follows: 2016 2015 Deferred Tax Assets Net operating loss and tax credits $ 3,881,415 $ 2,274,994 Property and equipment and intangibles 331,301 326,499 Allowance for accounts receivable 170,733 145,200 Reserve for expired product 771,034 849,579 Inventory 214,654 1,154,507 Deferred charges 738,541 660,973 Cumulative compensation costs incurred on deductible equity awards 639,263 1,675,757 Total deferred tax assets 6,746,941 7,087,509 Deferred Tax Liabilities Intangible assets (3,238,511 ) (3,162,502 ) Net deferred tax assets, before valuation allowance 3,508,430 3,925,007 Less: deferred tax asset valuation allowance (388,500 ) (185,497 ) Net deferred tax assets $ 3,119,930 $ 3,739,510 |
Schedule of federal and state net operating loss carryforwards | The following table summarizes the amount and year of expiration of the Company's federal and state net operating loss carryforwards as of December 31, 2016 : Years of expiration Federal State 2017 - 2019 $ — $ 454,898 2020 - 2028 — 38,884,460 2029 44,149,007 10,489,653 2030 - 2036 6,008,921 5,061,020 Total federal and state net operating loss carryforwards $ 50,157,928 $ 54,890,031 |
Schedule of the components of income tax benefit (expense) | Income tax (expense) benefit includes the following components for the years ended December 31: 2016 2015 2014 Current: Federal $ 867,041 $ (41,326 ) $ (1,440,010 ) State and other 83,463 (44,276 ) (250,064 ) Total current income tax (expense) benefit 950,504 (85,602 ) (1,690,074 ) Deferred: Federal (537,965 ) (385,723 ) 213,552 State (81,615 ) (104,504 ) 95,778 Total deferred income tax (expense) benefit (619,580 ) (490,227 ) 309,330 Total income tax (expense) benefit $ 330,924 $ (575,829 ) $ (1,380,744 ) |
Schedule of the components of deferred tax benefit (expense) | Deferred income tax is comprised of the following components for the years ended December 31: 2016 2015 2014 Deferred tax (expense) benefit, excluding items below $ 4,803 $ 26,193 $ 85,844 Inventory (939,853 ) (257,970 ) (83,418 ) Operating loss carryforwards 1,537,003 34,465 17,424 Tax credit carryforwards 69,418 35,272 43,398 Valuation allowance due to changes in net deferred tax asset balances (203,003 ) (33,405 ) (20,457 ) Deductible equity awards (1,036,494 ) (972 ) 298,039 Allowance for accounts receivable 25,532 (26,808 ) (63,438 ) Deferred charges 77,567 (59,028 ) 838,556 Reserve for expired product (78,544 ) 31,784 217,330 Intangible assets (76,009 ) (239,758 ) (1,023,948 ) Deferred income tax (expense) benefit $ (619,580 ) $ (490,227 ) $ 309,330 |
Schedule of effective tax rate reconciliation | The Company’s effective income tax rate for 2016 , 2015 and 2014 reconciles with the federal statutory tax rate as follows: 2016 2015 2014 Federal tax expense at statutory rate 34 % 34 % 34 % State income tax expense (net of federal income tax benefit) 4 % 4 % 5 % Permanent differences associated with general business credits 5 % (3 )% (1 )% Change in valuation allowance (15 )% 3 % 1 % Other permanent differences (2 )% 7 % 1 % Other (1 )% 1 % (3 )% Net income tax expense 25 % 46 % 37 % |
Stock-Based Compensation Plans
Stock-Based Compensation Plans (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of share-based compensation expense | Stock compensation expense recorded as a component of equity consisted of the following for the years ended December 31: 2016 2015 2014 Share-based compensation - employees $ 833,027 $ 456,749 $ 660,963 Share-based compensation - nonemployees 19,075 165,754 99,931 Total share-based compensation $ 852,102 $ 622,503 $ 760,894 |
Schedule of stock options activity | Stock option activity for 2016 and 2015 was as follows: Number of shares Weighted-average exercise price per share Weighted- average remaining contractual term (years) Aggregate intrinsic value Outstanding, December 31, 2014 158,356 $ 7.62 0.4 $ 2,320 Options granted — — Options exercised (5,652 ) 5.75 Options forfeited or expired (140,404 ) 7.41 Outstanding, December 31, 2015 12,300 10.89 1.6 — Options granted — — Options exercised — — Options forfeited or expired (6,500 ) 9.00 Outstanding, December 31, 2016 5,800 13.00 1.9 $ — Exercisable at December 31, 2016 5,800 $ 13.00 1.9 $ — |
Schedule of stock options activity, additional disclosures | Information related to the stock option plans during 2016 , 2015 and 2014 was as follows: 2016 2015 2014 Intrinsic value of options exercised $ — $ 3,875 $ — Weighted-average fair value of options exercised $ — $ 3.26 $ — |
Schedule of restricted stock activity | Restricted stock activity was as follows: Number of shares Weighted- average grant-date fair value Nonvested, December 31, 2014 692,837 $ 4.92 Shares granted 225,661 6.72 Shares vested (81,270 ) 5.22 Shares forfeited (97,179 ) 5.49 Nonvested, December 31, 2015 740,049 5.36 Shares granted 228,425 4.36 Shares vested (223,987 ) 5.28 Shares forfeited (41,192 ) 4.23 Nonvested, December 31, 2016 703,295 5.13 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Leases [Abstract] | |
Schedule of future minimum lease payments for operating leases | Future minimum lease payments under noncancelable operating leases (with initial or remaining lease terms in excess of one year) are as follows: Year ending December 31: 2017 $ 1,039,618 2018 901,568 2019 838,896 2020 856,084 2021 and thereafter 1,612,969 Total future minimum lease payments $ 5,249,135 |
Fair Value of Financial Instr41
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Schedule of fair value of financial instruments by level in hierarchy | The following table summarizes the fair value of these marketable securities by level within the fair value hierarchy: December 31, 2016 December 31, 2015 Level 1 Level 2 Total Level 1 Level 2 Total U.S. Agency issued mortgage-backed securities - variable rate $ — $ 6,814,957 $ 6,814,957 $ — $ 5,700,335 $ 5,700,335 U.S. Agency notes and bonds - fixed rate — 1,795,330 1,795,330 — 2,447,066 2,447,066 SBA loan pools - variable rate — 1,346,824 1,346,824 — 1,681,714 1,681,714 Municipal bonds - VRDN 5,665,000 — 5,665,000 4,735,000 — 4,735,000 Total fair value of marketable securities $ 5,665,000 $ 9,957,111 $ 15,622,111 $ 4,735,000 $ 9,829,115 $ 14,564,115 |
Market Concentrations (Tables)
Market Concentrations (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Risks and Uncertainties [Abstract] | |
Schedule of revenues concentration from major customers | Total gross revenues by customer for each customer representing 10% or more of consolidated gross revenues are summarized below for the years ended December 31: 2016 2015 2014 Customer 1 22% 22% 21% Customer 2 28% 28% 27% Customer 3 29% 32% 34% Customer 4 10% 9% 11% |
Quarterly Financial Informati43
Quarterly Financial Information (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of quarterly financial information | The following table sets forth the unaudited operating results for each fiscal quarter of 2016 and 2015 : First Quarter Second Quarter Third Quarter Fourth Quarter Total 2016: Net revenues $ 7,737,532 $ 7,414,835 $ 8,791,753 $ 9,081,440 $ 33,025,560 Operating income (loss) (500,583 ) (105,309 ) 130,132 (957,371 ) (1,433,131 ) Net income (loss) attributable to common shareholders (253,111 ) (48,044 ) 106,166 (749,694 ) (944,683 ) Earnings (loss) per share attributable to common shareholders (1) Basic $ (0.02 ) $ — $ 0.01 $ (0.05 ) $ (0.06 ) Diluted $ (0.02 ) $ — $ 0.01 $ (0.05 ) $ (0.06 ) 2015: Net revenues $ 8,686,774 $ 8,909,741 $ 7,885,048 $ 8,037,488 $ 33,519,051 Operating income 4,116 673,931 270,884 162,679 1,111,610 Net income attributable to common shareholders 46,281 407,398 126,613 151,059 731,351 Earnings per share attributable to common shareholders (1) Basic $ — $ 0.02 $ 0.01 $ 0.01 $ 0.04 Diluted $ — $ 0.02 $ 0.01 $ 0.01 $ 0.04 (1) Due to the nature of interim earnings per share calculations, the sum of the quarterly earnings (loss) per share amounts may not equal the reported earnings (loss) per share for the full year. |
Organization (Narrative) (Detai
Organization (Narrative) (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2014 | |
Noncontrolling Interest [Abstract] | ||||
Noncontrolling interest, ownership percentage by parent | 85.00% | |||
Exercise of options and related tax benefit | $ 1,000,005 | |||
Net loss at subsidiary allocated to noncontrolling interests | $ 59,255 | $ 60,243 | $ 61,258 | |
Cumberland Emerging Technologies, Inc (CET) | ||||
Noncontrolling Interest [Abstract] | ||||
Noncontrolling interest, ownership percentage by parent | 80.00% | |||
Cumberland Emerging Technologies, Inc (CET) | Harbin Gloria Pharmaceuticals Co | ||||
Noncontrolling Interest [Abstract] | ||||
Exercise of options and related tax benefit | $ 1,000,000 |
Significant Accounting Polici45
Significant Accounting Policies (Narrative) (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016USD ($)ft²segment | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Segment Reporting [Abstract] | |||
Number of operating segments | segment | 1 | ||
Net revenues from customers outside the United States | $ 2 | $ 0.9 | $ 0.6 |
Distribution costs | 0.7 | 0.8 | 1 |
Advertising costs | $ 2.6 | $ 2.6 | $ 2.5 |
Corporate Headquarters | |||
Operating Leased Assets [Line Items] | |||
Area of Real Estate Property | ft² | 25,500 | ||
CET Life Sciences Center | |||
Operating Leased Assets [Line Items] | |||
Area of Real Estate Property | ft² | 14,200 |
Significant Accounting Polici46
Significant Accounting Policies (Schedule of Intangible Assets, Useful Lives) (Details) | 12 Months Ended |
Dec. 31, 2016 | |
Product Rights | |
Finite-Lived Intangible Assets [Line Items] | |
Intangible assets, useful life | Estimated economic life |
Licensing Rights | |
Finite-Lived Intangible Assets [Line Items] | |
Intangible assets, useful life | Term of license agreement |
Patents | |
Finite-Lived Intangible Assets [Line Items] | |
Intangible assets, useful life | Life of patent |
Vaprisol, Omeclamox-Pak, Ethy47
Vaprisol, Omeclamox-Pak, Ethyol, and Methotrexate - Narrative (Details) - USD ($) shares in Thousands | Oct. 29, 2013 | Nov. 30, 2016 | Apr. 30, 2015 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Feb. 28, 2014 |
Business Acquisition [Line Items] | |||||||||||||||
Net product revenue | $ 32,478,185 | $ 33,013,184 | $ 36,683,762 | ||||||||||||
Net revenues | $ 9,081,440 | $ 8,791,753 | $ 7,414,835 | $ 7,737,532 | $ 8,037,488 | $ 7,885,048 | $ 8,909,741 | $ 8,686,774 | 33,025,560 | 33,519,051 | 36,901,871 | ||||
Other revenue, potential upfront payment related to product sales | 4,700,000 | ||||||||||||||
Payments to acquire businesses | 0 | 0 | 2,000,000 | ||||||||||||
Amended International Agreement | Pernix Therapeutics | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Other revenue, potential upfront payment related to product sales | $ 4,000,000 | ||||||||||||||
Vaprisol | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Upfront payment | $ 2,000,000 | ||||||||||||||
Additional upfront payments | $ 2,000,000 | ||||||||||||||
Payments for contingent consideration | $ 1,700,000 | ||||||||||||||
Gain on contingent consideration | 300,000 | ||||||||||||||
Acquired contingent liabilities | $ 100,000 | 100,000 | |||||||||||||
Omeclamox-Pak | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Additional upfront payments | $ 4,000,000 | ||||||||||||||
Net product revenue | 2,500,000 | 3,000,000 | |||||||||||||
Omeclamox-Pak | Minimum | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Royalty payments based on percentage over gross profits | 15.00% | ||||||||||||||
Omeclamox-Pak | Maximum | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Royalty payments based on percentage over gross profits | 20.00% | ||||||||||||||
Ethyol | Minimum | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Royalty payments based on percentage over gross profits | 30.00% | ||||||||||||||
Ethyol | Maximum | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Royalty payments based on percentage over gross profits | 50.00% | ||||||||||||||
Methotrexate | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Payments to acquire businesses | $ 100,000 | ||||||||||||||
Liabilities incurred | 900,000 | ||||||||||||||
Stock issued during period, acquisitions | $ 990,000 | ||||||||||||||
Vaprisol | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Net product revenue | 1,857,838 | 2,641,484 | 3,011,997 | ||||||||||||
Product, Ethyol | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Net product revenue | $ 838,386 | $ 0 | $ 0 | ||||||||||||
Restricted Stock | Methotrexate | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Stock issued during period, acquisitions (in shares) | 180 |
Vaprisol, Omeclamox-Pak, Ethy48
Vaprisol, Omeclamox-Pak, Ethyol, and Methotrexate - Assets and Liabilities Assumed (Details) - Vaprisol | Feb. 28, 2014USD ($) |
Business Acquisition [Line Items] | |
Intellectual property intangible assets | $ 2,990,000 |
Inventories | 1,410,000 |
Acquired contingent liabilities | (400,000) |
Contingent consideration obligation | (2,000,000) |
Total net assets acquired | $ 2,000,000 |
Revenues (Schedule of Net Produ
Revenues (Schedule of Net Product Revenues by Product) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Revenue from External Customer [Line Items] | |||
Net product revenue | $ 32,478,185 | $ 33,013,184 | $ 36,683,762 |
Product, Acetadote | |||
Revenue from External Customer [Line Items] | |||
Net product revenue | 7,214,341 | 8,489,167 | 11,906,232 |
Product, Omeclamox-Pak | |||
Revenue from External Customer [Line Items] | |||
Net product revenue | 2,536,027 | 3,037,078 | 4,111,916 |
Product, Kristalose | |||
Revenue from External Customer [Line Items] | |||
Net product revenue | 15,898,760 | 15,733,327 | 14,932,271 |
Product, Vaprisol | |||
Revenue from External Customer [Line Items] | |||
Net product revenue | 1,857,838 | 2,641,484 | 3,011,997 |
Product, Caldolor | |||
Revenue from External Customer [Line Items] | |||
Net product revenue | 4,132,833 | 3,112,128 | 2,721,346 |
Product, Ethyol | |||
Revenue from External Customer [Line Items] | |||
Net product revenue | $ 838,386 | $ 0 | $ 0 |
Revenues (Narrative) (Details)
Revenues (Narrative) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Product Revenues | |||
Net product revenue | $ 32,478,185 | $ 33,013,184 | $ 36,683,762 |
Accrued liabilities, current | 6,755,652 | 9,534,268 | |
Other Revenues | |||
Other revenue, upfront payment | 1,400,000 | ||
Other revenue, potential upfront payments related to regulatory approval | 1,700,000 | ||
Other revenue, potential upfront payment related to product sales | 4,700,000 | ||
Cumulative upfront payment | 1,500,000 | ||
Revenue related to milestone payments | 200,000 | ||
Product Sales Related Accruals - Rebates, Product Returns, Administrative Fees and Service Fees | |||
Product Revenues | |||
Accrued liabilities, current | 4,100,000 | 6,800,000 | |
Product, Caldolor | |||
Product Revenues | |||
Net product revenue | 4,132,833 | 3,112,128 | 2,721,346 |
Product, Acetadote, Generic | |||
Product Revenues | |||
Net product revenue | 4,800,000 | 4,500,000 | 5,800,000 |
Product, Ethyol | |||
Product Revenues | |||
Net product revenue | 838,386 | 0 | 0 |
Product Sales Related Allowances - Chargebacks, Cash Discounts and Damaged Goods | |||
Product Revenues | |||
Accounts receivable, allowances, current | 400,000 | 400,000 | |
Collaborative Arrangement, Federal Small Business Grant Programs | |||
Other Revenues | |||
Other revenues, grants | 100,000 | 200,000 | $ 100,000 |
Outside US | Product, Caldolor | |||
Product Revenues | |||
Net product revenue | $ 2,000,000 | $ 800,000 |
Inventories (Schedule of Invent
Inventories (Schedule of Inventories, Current) (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Inventory Disclosure [Abstract] | ||
Raw materials and work in process | $ 2,810,711 | $ 2,576,621 |
Consigned inventory | 277,324 | 235,636 |
Finished goods | 2,283,694 | 1,457,886 |
Total inventories | $ 5,371,729 | $ 4,270,143 |
Inventories (Narrative) (Detail
Inventories (Narrative) (Details) - USD ($) $ in Millions | 1 Months Ended | |||
Mar. 31, 2015 | Jan. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | |
Inventory Disclosure [Abstract] | ||||
Shelf life | 6 years | 5 years | ||
Extended Shelf Life | 7 years | 6 years | ||
Inventory reserves, obsolescence and discontinuance | $ 0.3 | $ 2.7 |
Property and Equipment (Schedul
Property and Equipment (Schedule of Property and Equipment) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 3,164,394 | $ 3,033,522 |
Less: accumulated depreciation and amortization | (2,699,940) | (2,497,072) |
Total property and equipment, net | 464,454 | 536,450 |
Computer Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 933,752 | 839,563 |
Computer Equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful life | 3 years | |
Computer Equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful life | 5 years | |
Office Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 355,456 | 332,126 |
Office Equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful life | 3 years | |
Office Equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful life | 15 years | |
Furniture and Fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 618,808 | 618,808 |
Furniture and Fixtures | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful life | 5 years | |
Furniture and Fixtures | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful life | 15 years | |
Leasehold Improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 1,256,378 | $ 1,243,025 |
Property and equipment, useful life (Textual) | 3 – 15 years, or remaining lease term | |
Leasehold Improvements | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful life | 3 years | |
Leasehold Improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful life | 15 years |
Property and Equipment (Narrati
Property and Equipment (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation, including amortization related to leasehold improvements | $ 0.2 | $ 0.3 | $ 0.4 |
Intangible Assets (Schedule of
Intangible Assets (Schedule of Intangible Assets) (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, net | $ 22,154,176 | $ 21,168,596 |
Product and License Rights | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | 20,543,262 | 18,011,362 |
Accumulated amortization | (4,988,333) | (3,541,305) |
Intangible assets, net | 15,554,929 | 14,470,057 |
Patents | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | 8,844,994 | 8,236,719 |
Accumulated amortization | (2,298,442) | (1,551,430) |
Intangible assets, net | 6,546,552 | 6,685,289 |
Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | 61,715 | 22,270 |
Accumulated amortization | (9,020) | (9,020) |
Intangible assets, net | $ 52,695 | $ 13,250 |
Intangible Assets (Narrative) (
Intangible Assets (Narrative) (Details) - USD ($) shares in Thousands | Oct. 29, 2013 | Nov. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Feb. 28, 2014 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Other revenue, potential upfront payment related to product sales | $ 4,700,000 | |||||
Additions to intangible assets | 2,000,226 | $ 2,556,465 | $ 3,101,565 | |||
Amortization of intangible assets | 2,194,039 | 1,989,264 | 1,596,689 | |||
Payments to acquire businesses | 0 | 0 | $ 2,000,000 | |||
Product and License Rights | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Intangible assets, gross | 20,543,262 | 18,011,362 | ||||
Patents | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Intangible assets, gross | 8,844,994 | 8,236,719 | ||||
Additions to intangible assets | $ 600,000 | 100,000 | ||||
Product Rights Agreement, U.S. Commercialization Rights for Kristalose from Inalco Biochemicals, Inc. and Inalco S.p.A. | Product, Kristalose | Product and License Rights | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Product rights agreement, quarterly payments, expiration date | 7 years | |||||
Quarterly payments made | $ 1,400,000 | $ 1,500,000 | ||||
Product, Vaprisol | Product and License Rights | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Intangible assets, gross | $ 3,000,000 | |||||
Pernix Therapeutics | Collaborative Arrangement, Amended International Agreement | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Other revenue, potential upfront payment related to product sales | $ 4,000,000 | |||||
Methotrexate | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Payments to acquire businesses | $ 100,000 | |||||
Liabilities incurred | 900,000 | |||||
Stock issued during period, acquisitions | $ 990,000 | |||||
Restricted Stock | Methotrexate | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Stock issued during period, acquisitions (in shares) | 180 |
Intangible Assets Future Amorti
Intangible Assets Future Amortization Expense (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2,017 | $ 2,320,093 | |
2,018 | 2,338,260 | |
2,019 | 2,392,760 | |
2,020 | 2,392,760 | |
2021 and thereafter | 12,710,303 | |
Intangible assets, net | $ 22,154,176 | $ 21,168,596 |
Other Current Liabilities (Sche
Other Current Liabilities (Schedule of Accrued Liabilities) (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Other Liabilities, Current [Abstract] | ||
Rebates, product returns, administrative fees and service fees | $ 4,051,029 | $ 6,776,023 |
Employee wages and benefits | 872,914 | 1,034,991 |
Other | 1,831,709 | 1,723,254 |
Total other current liabilities | $ 6,755,652 | $ 9,534,268 |
Debt (Line of Credit) (Details)
Debt (Line of Credit) (Details) - USD ($) | Jun. 26, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Aug. 31, 2011 |
Line of Credit Facility [Line Items] | ||||
Revolving line of credit | $ 4,100,000 | $ 1,700,000 | ||
Line of Credit | Credit Facility, Fifth Amended and Restated Loan Agreement, the Agreement, August 2011 | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit, maximum borrowing capacity | $ 10,000,000 | |||
SunTrust Bank | Line of Credit | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit, maximum borrowing capacity | $ 12,000,000 | |||
Line of credit, maximum borrowing capacity upon satisfaction of certain conditions | $ 20,000,000 | |||
Interest rate, minimum | 1.00% | |||
Interest rate, maximum | 2.85% | |||
Debt instrument, interest rate at end of period | 1.60% | |||
Line of credit, unused capacity, commitment fee percentage | 0.25% | |||
Deferred finance costs | $ 100,000 |
Shareholders' Equity (Initial P
Shareholders' Equity (Initial Public Offering, Preferred Stock and Common Stock, Narrative) (Details) $ / shares in Units, $ in Millions | Aug. 10, 2009USD ($)$ / sharesshares | Dec. 31, 2016shares | Dec. 31, 2015shares | Dec. 31, 2014shares |
Preferred Stock [Abstract] | ||||
Preferred stock, shares authorized | shares | 20,000,000 | |||
Common stock | ||||
Initial Public Offering [Abstract] | ||||
Initial public offering, effective date | Aug. 10, 2009 | |||
Initial public offering, shares issued | shares | 5,000,000 | |||
Initial public offering, price per share | $ / shares | $ 17 | |||
Initial public offering, gross proceeds | $ | $ 85 | |||
Initial public offering, underwriting discounts | $ | 6 | |||
Initial public offering, issuance costs | $ | 4.2 | |||
Initial public offering, net proceeds | $ | $ 74.8 | |||
Initial public offering, number of shares common stock received in exchange for preferred stock | 2 | |||
Common stock | ||||
Common Stock [Abstract] | ||||
Share-based compensation, shares | shares | 223,987 | 86,102 | 15,300 | |
Exercise of options and related tax benefit, shares | shares | 3,409 |
Shareholders' Equity (Warrants,
Shareholders' Equity (Warrants, Narrative) (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2009 | Dec. 31, 2006 | |
Warrants, Issued in Consideration of 2006 Credit Facility Amendment | ||
Class of Warrant or Right [Line Items] | ||
Warrants, number of shares called by warrants | 3,958 | |
Warrants, exercise price | $ 9 | |
Warrants, Issued in Consideration of 2009 Credit Facility Amendment | ||
Class of Warrant or Right [Line Items] | ||
Warrants, number of shares called by warrants | 7,500 | |
Warrants, exercise price | $ 17 | |
Warrants, expiration date | Jul. 31, 2019 |
Shareholders' Equity (Share Rep
Shareholders' Equity (Share Repurchases, Cumberland Emerging Technologies, Narrative) (Details) - USD ($) | 1 Months Ended | 12 Months Ended | ||||
Apr. 30, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2014 | May 31, 2010 | |
Equity, Class of Treasury Stock [Line Items] | ||||||
Repurchase of common shares, value | $ 2,520,715 | $ 5,338,967 | $ 4,315,444 | |||
Exercise of options and related tax benefit | $ 1,000,005 | |||||
Noncontrolling interest, ownership percentage by parent | 85.00% | |||||
Payments to acquire interest in subsidiaries | $ 1,000,000 | |||||
Loans Forgiven in Exchange For Share Issued, Amount | $ 2,400,000 | |||||
Shares Repurchase, All, Except Settlement of Tax Liabilities Related to Exercise of Stock Options | ||||||
Equity, Class of Treasury Stock [Line Items] | ||||||
Repurchase of common shares, shares | (529,312) | (829,003) | (881,810) | |||
Repurchase of common shares, value | $ 2,500,000 | $ 5,300,000 | $ 4,300,000 | |||
Share Repurchase Program Authorized in 2010 | ||||||
Equity, Class of Treasury Stock [Line Items] | ||||||
Share repurchase program, number of shares authorized to be repurchased | $ 10,000,000 |
Earnings (Loss) Per Share (Sche
Earnings (Loss) Per Share (Schedule of Computation of Numerator and Denominator in Earnings Per Share) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Numerator: | |||||||||||
Net income (loss) attributable to common shareholders | $ (749,694) | $ 106,166 | $ (48,044) | $ (253,111) | $ 151,059 | $ 126,613 | $ 407,398 | $ 46,281 | $ (944,683) | $ 731,351 | $ 2,423,723 |
Denominator: | |||||||||||
Weighted-average shares outstanding – basic (in shares) | 16,236,525 | 16,715,970 | 17,617,765 | ||||||||
Dilutive effect of restricted stock and stock options (in shares) | 0 | 378,784 | 281,867 | ||||||||
Weighted-average shares outstanding – diluted (in shares) | 16,236,525 | 17,094,754 | 17,899,632 |
Earnings (Loss) Per Share (Sc64
Earnings (Loss) Per Share (Schedule of Anti-dilutive Securities Excluded From Computation of Earnings Per Share) (Details) - shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Earnings Per Share [Abstract] | |||
Anti-dilutive shares (in shares) | 13,300 | 46,633 | 194,237 |
Income Taxes (Operating Loss Ca
Income Taxes (Operating Loss Carryforwards, Narrative) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Charitable, Foreign Tax Credit and AMT Carryforward | |||
Operating Loss Carryforwards [Line Items] | |||
Recognized carryforward tax asset | $ 200,000 | ||
Orphan Drug and Research and Development Tax Credit | |||
Operating Loss Carryforwards [Line Items] | |||
Recognized carryforward tax asset | 1,200,000 | ||
Federal | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 50,157,928 | ||
Federal | Exercise of NonQualified Stock Options | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 44,100,000 | ||
State | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 54,890,031 | ||
Operating loss carryforwards, amount subject to full valuation allowance | 4,200,000 | ||
State | Exercise of NonQualified Stock Options | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 45,400,000 | ||
Valuation allowance for deferred tax assets: | |||
Operating Loss Carryforwards [Line Items] | |||
Charged to costs and expenses | $ 203,003 | $ 33,423 | $ 20,457 |
Income Taxes (Schedule of Defer
Income Taxes (Schedule of Deferred Tax Assets and Liabilities, Net) (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred Tax Assets | ||
Net operating loss and tax credits | $ 3,881,415 | $ 2,274,994 |
Property and equipment and intangibles | 331,301 | 326,499 |
Allowance for accounts receivable | 170,733 | 145,200 |
Reserve for expired product | 771,034 | 849,579 |
Inventory | 214,654 | 1,154,507 |
Deferred charges | 738,541 | 660,973 |
Cumulative compensation costs incurred on deductible equity awards | 639,263 | 1,675,757 |
Total deferred tax assets | 6,746,941 | 7,087,509 |
Deferred Tax Liabilities | ||
Intangible assets | (3,238,511) | (3,162,502) |
Net deferred tax assets, before valuation allowance | 3,508,430 | 3,925,007 |
Less: deferred tax asset valuation allowance | (388,500) | (185,497) |
Net deferred tax assets | $ 3,119,930 | $ 3,739,510 |
Income Taxes (Schedule of Net O
Income Taxes (Schedule of Net Operating Loss Carryforwards) (Details) | Dec. 31, 2016USD ($) |
Federal | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards | $ 50,157,928 |
State | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards | 54,890,031 |
Expiration from 2016-2018 | Federal | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards | 0 |
Expiration from 2016-2018 | State | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards | 454,898 |
Expiration from 2019 to 2028 | Federal | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards | 0 |
Expiration from 2019 to 2028 | State | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards | 38,884,460 |
Expiration from in2029 | Federal | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards | 44,149,007 |
Expiration from in2029 | State | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards | 10,489,653 |
Expiration from 2030 to 2025 | Federal | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards | 6,008,921 |
Expiration from 2030 to 2025 | State | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards | $ 5,061,020 |
Income Taxes (Schedule of the C
Income Taxes (Schedule of the Components of Income Tax Benefit (Expense)) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Current: | |||
Federal | $ 867,041 | $ (41,326) | $ (1,440,010) |
State and other | 83,463 | (44,276) | (250,064) |
Total current income tax expense | 950,504 | (85,602) | (1,690,074) |
Deferred: | |||
Federal | (537,965) | (385,723) | 213,552 |
State | (81,615) | (104,504) | 95,778 |
Deferred income tax benefit (expense) | (619,580) | (490,227) | 309,330 |
Total income tax benefit (expense) | $ 330,924 | $ (575,829) | $ (1,380,744) |
Income Taxes (Schedule of the69
Income Taxes (Schedule of the Components of Deferred Income Tax Benefit (Expense)) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
Deferred tax (expense) benefit, excluding items below | $ 4,803 | $ 26,193 | $ 85,844 |
Inventory | (939,853) | (257,970) | (83,418) |
Operating loss carryforwards | 1,537,003 | 34,465 | 17,424 |
Tax credit carryforwards | 69,418 | 35,272 | 43,398 |
Valuation allowance due to changes in net deferred tax asset balances | (203,003) | (33,405) | (20,457) |
Deductible equity awards | (1,036,494) | (972) | 298,039 |
Allowance for accounts receivable | 25,532 | (26,808) | (63,438) |
Deferred charges | 77,567 | (59,028) | 838,556 |
Reserve for expired product | (78,544) | 31,784 | 217,330 |
Intangible assets | (76,009) | (239,758) | (1,023,948) |
Deferred income tax benefit (expense) | $ (619,580) | $ (490,227) | $ 309,330 |
Income Taxes (Schedule of Effec
Income Taxes (Schedule of Effective Income Tax Rate Reconciliation) (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
Federal tax expense at statutory rate | 34.00% | 34.00% | 34.00% |
State income tax expense (net of federal income tax benefit) | 4.00% | 4.00% | 5.00% |
Permanent differences associated with general business credits | 5.00% | (3.00%) | (1.00%) |
Effective Income Tax Rate Reconciliation, Change in Deferred Tax Assets Valuation Allowance, Percent | (15.00%) | 3.00% | 1.00% |
Other permanent differences | (2.00%) | 7.00% | 1.00% |
Other | (1.00%) | 1.00% | (3.00%) |
Net income tax expense | 25.00% | 46.00% | 37.00% |
Stock-Based Compensation Plan71
Stock-Based Compensation Plans (Narrative) (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2016USD ($)planshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of equity compensation plans | plan | 3 |
Number of equity compensation plans available for future grants | plan | 2 |
Unrecognized compensation cost related to share-based payments | $ | $ 1.7 |
Unrecognized compensation cost related to share-based payments, period for recognition | 2 years 6 months |
Principal Owner | Minimum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options, exercise price as percent of weighted-average grant date fair value | 110.00% |
NonPrincipal Owner | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options, exercise price as percent of weighted-average grant date fair value | 100.00% |
Long-Term Incentive Compensation Plan 2007 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of shares reserved for issuance under equity compensation plans | shares | 2,400,000 |
Directors’ Incentive Plan 2007 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of shares reserved for issuance under equity compensation plans | shares | 250,000 |
Stock Options | Principal Owner | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options, expiration period | 5 years |
Stock Options | NonPrincipal Owner | Maximum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options, expiration period | 10 years |
Restricted Stock | Employee | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Award vesting period | 4 years |
Restricted Stock | Director | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Award vesting period | 1 year |
Stock-Based Compensation Plan72
Stock-Based Compensation Plans (Schedule of Share-Based Compensation Expense) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation | $ 852,102 | $ 622,503 | $ 760,894 |
Employee | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation | 833,027 | 456,749 | 660,963 |
Nonemployee | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation | $ 19,075 | $ 165,754 | $ 99,931 |
Stock-Based Compensation Plan73
Stock-Based Compensation Plans (Schedule of Stock Options Activity) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Number of shares | |||
Outstanding, beginning of period, shares | 12,300 | 158,356 | |
Options granted, shares | 0 | 0 | |
Options exercised, shares | 0 | (5,652) | |
Options forfeited or expired, shares | (6,500) | (140,404) | |
Outstanding, end of period, shares | 5,800 | 12,300 | 158,356 |
Options, exerciseable, end of period, shares | 5,800 | ||
Weighted-average exercise price per share | |||
Outstanding, beginning of period, weighted-average exercise price per share (in USD per share) | $ 10.89 | $ 7.62 | |
Options granted, weighted-average exercise price per share (in USD per share) | 0 | 0 | |
Options exercised, weighted-average exercise price per share (in USD per share) | 0 | 5.75 | |
Options forfeited or expired, weighted-average exercise price per share (in USD per share) | 9 | 7.41 | |
Outstanding, end of period, weighted-average exercise price per share (in USD per share) | 13 | $ 10.89 | $ 7.62 |
Exercisable, end of period, weighted-average exercise price per share (in USD per share) | $ 13 | ||
Outstanding, end of period, weighted-average remaining contractual term | 1 year 10 months 15 days | 1 year 7 months 15 days | 4 months 25 days |
Exercisable, end of period, weighted-average remaining contractual term | 1 year 10 months 15 days | ||
Outstanding, end of period, aggregate intrinsic value | $ 0 | $ 0 | $ 2,320 |
Exercisable, end of period, aggregate intrinsic value | $ 0 |
Stock-Based Compensation Plan74
Stock-Based Compensation Plans (Schedule of Stock Option Activity, Additional Disclosures) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Intrinsic value of options exercised | $ 0 | $ 3,875 | $ 0 |
Weighted-average fair value of options exercised | $ 0 | $ 3.26 | $ 0 |
Stock-Based Compensation Plan75
Stock-Based Compensation Plans (Schedule of Restricted Stock Activity) (Details) - Restricted Stock - $ / shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Number of shares | ||
Nonvested, beginning of period, shares | 740,049 | 692,837 |
Shares granted, shares | 228,425 | 225,661 |
Shares vested, shares | (223,987) | (81,270) |
Shares forfeited, shares | (41,192) | (97,179) |
Nonvested, end of period, shares | 703,295 | 740,049 |
Weighted- average grant-date fair value | ||
Nonvested, beginning of period, weighted-average grant-date fair value | $ 5.36 | $ 4.92 |
Shares granted, weighted-average grant-date fair value | 4.36 | 6.72 |
Shares vested, weighted-average grant-date fair value | 5.28 | 5.22 |
Shares forfeited, weighted-average grant-date fair value | 4.23 | 5.49 |
Nonvested, end of period, weighted-average grant-date fair value | $ 5.13 | $ 5.36 |
Employee Benefit Plans (Narrati
Employee Benefit Plans (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Defined Contribution Pension and Other Postretirement Plans Disclosure [Abstract] | |||
Defined contribution plan, eligibiilty, minimum employee age | 21 years | ||
Defined contribution plan, eligibility, minimum employee service time for participation eligibility | 6 months | ||
Defined contribution plan, employer discretionary contribution amount | $ 50 | $ 50 | $ 50 |
Deferred Compensation Arrangements [Abstract] | |||
Deferred compensation liability | 1,200 | 700 | |
Deferred compensation assets | $ 1,900 | $ 1,800 |
Leases (Narrative) (Details)
Leases (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Leases [Abstract] | |||
Rent expense | $ 1.2 | $ 1 | $ 1 |
Sublease income | 0.6 | $ 0.6 | $ 0.5 |
Future minimum sublease income under noncancelable operating subleases | $ 0.9 |
Leases (Schedule of Future Mini
Leases (Schedule of Future Minimum Rental Payments for Operating Leases) (Details) | Dec. 31, 2016USD ($) |
Leases [Abstract] | |
2,017 | $ 1,039,618 |
2,018 | 901,568 |
2,019 | 838,896 |
2,020 | 856,084 |
2021 and thereafter | 1,612,969 |
Total future minimum lease payments | $ 5,249,135 |
Fair Value of Financial Instr79
Fair Value of Financial Instruments (Schedule of Fair Value of Financial Instruments by Level in Hierarchy and Narrative) (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | $ 15,622,111 | $ 14,564,115 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 5,665,000 | 4,735,000 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 9,957,111 | 9,829,115 |
U.S. Agency Issued Mortgage-backed Securities - Variable Rate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 6,814,957 | 5,700,335 |
U.S. Agency Issued Mortgage-backed Securities - Variable Rate | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 0 | 0 |
U.S. Agency Issued Mortgage-backed Securities - Variable Rate | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 6,814,957 | 5,700,335 |
U.S. Agency Notes and Bonds - Fixed Rate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 1,795,330 | 2,447,066 |
U.S. Agency Notes and Bonds - Fixed Rate | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 0 | 0 |
U.S. Agency Notes and Bonds - Fixed Rate | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 1,795,330 | 2,447,066 |
SBA Loan Pools - Variable Rate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 1,346,824 | 1,681,714 |
SBA Loan Pools - Variable Rate | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 0 | 0 |
SBA Loan Pools - Variable Rate | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 1,346,824 | 1,681,714 |
Municipal Bonds - VRDN | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 5,665,000 | 4,735,000 |
Municipal Bonds - VRDN | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 5,665,000 | 4,735,000 |
Municipal Bonds - VRDN | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | $ 0 | $ 0 |
Market Concentrations (Schedule
Market Concentrations (Schedule of Revenues Concentration from Major Customers and Narrative) (Details) - Customer Concentration Risk - customer | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Sales Revenue, Goods, Gross | Customer 1 | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 22.00% | 22.00% | 21.00% |
Sales Revenue, Goods, Gross | Customer 2 | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 28.00% | 28.00% | 27.00% |
Sales Revenue, Goods, Gross | Customer 3 | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 29.00% | 32.00% | 34.00% |
Sales Revenue, Goods, Gross | Customer 4 | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 10.00% | 9.00% | 11.00% |
Accounts Receivable | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 86.00% | 71.00% | |
Concentration risk, number of major customers exceeding 10 percent threshhold | 4 | 4 |
Manufacturing and Supply Agre81
Manufacturing and Supply Agreements Manufacturing and Supply Agreements (Narrative) (Details) | Dec. 31, 2016supplier |
Minimum | |
Manufacturing and Supply Agreement [Line Items] | |
Manufacturing agreements, number of primary suppliers for each product | 1 |
Maximum | |
Manufacturing and Supply Agreement [Line Items] | |
Manufacturing agreements, number of primary suppliers for each product | 2 |
Commitments and Contingencies (
Commitments and Contingencies (Legal Matters, Narrative) (Details) - Product, Acetadote - Patent Infringement | 1 Months Ended |
Apr. 30, 2012lawsuitcompany | |
Loss Contingencies [Line Items] | |
Number of lawsuits filed as plaintiff | lawsuit | 5 |
Number of companies for which litigation settlement exists | company | 2 |
Quarterly Financial Informati83
Quarterly Financial Information (Schedule of Quarterly Financial Information (Unaudited)) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Net revenues | $ 9,081,440 | $ 8,791,753 | $ 7,414,835 | $ 7,737,532 | $ 8,037,488 | $ 7,885,048 | $ 8,909,741 | $ 8,686,774 | $ 33,025,560 | $ 33,519,051 | $ 36,901,871 |
Operating income (loss) | (957,371) | 130,132 | (105,309) | (500,583) | 162,679 | 270,884 | 673,931 | 4,116 | (1,433,131) | 1,111,610 | 3,558,836 |
Net income (loss) attributable to common shareholders | $ (749,694) | $ 106,166 | $ (48,044) | $ (253,111) | $ 151,059 | $ 126,613 | $ 407,398 | $ 46,281 | $ (944,683) | $ 731,351 | $ 2,423,723 |
Earnings per share attributable to common shareholders | |||||||||||
Basic (in USD per share) | $ (0.05) | $ 0.01 | $ 0 | $ (0.02) | $ 0.01 | $ 0.01 | $ 0.02 | $ 0 | $ (0.06) | $ 0.04 | $ 0.14 |
Diluted (in USD per share) | $ (0.05) | $ 0.01 | $ 0 | $ (0.02) | $ 0.01 | $ 0.01 | $ 0.02 | $ 0 | $ (0.06) | $ 0.04 | $ 0.14 |
Valuation and Qualifying Acco84
Valuation and Qualifying Accounts (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Allowance for uncollectible amounts, cash discounts, chargebacks, and credits issued for damaged products: | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at beginning of period | $ 381,240 | $ 438,357 | $ 593,116 |
Charged to costs and expenses | 3,755,804 | 3,903,285 | 5,166,568 |
Charged to other accounts | 0 | 0 | 0 |
Deductions | (3,687,185) | (3,960,402) | (5,321,327) |
Balance at end of period | 449,859 | 381,240 | 438,357 |
Valuation allowance for deferred tax assets: | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at beginning of period | 185,497 | 152,074 | 131,617 |
Charged to costs and expenses | 203,003 | 33,423 | 20,457 |
Charged to other accounts | 0 | 0 | 0 |
Deductions | 0 | 0 | 0 |
Balance at end of period | $ 388,500 | $ 185,497 | $ 152,074 |