Cover Page
Cover Page - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Mar. 16, 2020 | Jun. 28, 2019 | |
Cover page. | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Transition Report | false | ||
Entity Registrant Name | CUMBERLAND PHARMACEUTICALS INC | ||
Entity Incorporation, State or Country Code | TN | ||
Entity Tax Identification Number | 62-1765329 | ||
Entity File Number | 001-33637 | ||
Entity Central Index Key | 0001087294 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Address, Address Line One | 2525 West End Avenue | ||
Entity Address, Address Line Two | Suite 950 | ||
Entity Address, City or Town | Nashville | ||
Entity Address, State or Province | TN | ||
Entity Address, Postal Zip Code | 37203 | ||
City Area Code | 615 | ||
Local Phone Number | 255-0068 | ||
Title of 12(b) Security | Common Stock, $0.00 par value per share | ||
Trading Symbol | CPIX | ||
Security Exchange Name | NASDAQ | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | false | ||
Entity Shell Company | false | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Public Float | $ 57,172,655 | ||
Entity Common Stock, Shares Outstanding | 15,181,442 | ||
Documents Incorporated by Reference | Certain information required in Part III of Form 10-K is incorporated by reference from the registrant’s Proxy Statement for its 2020 annual meeting of shareholders. |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 28,212,635 | $ 27,938,960 |
Marketable securities | 0 | 8,290,679 |
Accounts receivable, net of allowances | 9,781,463 | 7,844,249 |
Inventories, net | 9,411,521 | 12,078,343 |
Prepaid and other current assets | 2,757,456 | 2,963,806 |
Total current assets | 50,163,075 | 59,116,037 |
Non-current inventories | 15,554,992 | 15,749,000 |
Property and equipment, net | 747,796 | 771,213 |
Intangible assets, net | 30,920,324 | 33,655,099 |
Goodwill | 882,000 | 784,000 |
Deferred tax assets, net | 21,802 | 87,210 |
Operating lease right-of-use assets | 2,960,569 | |
Other assets | 3,298,725 | 2,531,309 |
Total assets | 104,549,283 | 112,693,868 |
Current liabilities: | ||
Accounts payable | 11,912,446 | 11,093,297 |
Operating lease current liabilities | 920,431 | |
Other current liabilities | 11,317,358 | 16,710,927 |
Total current liabilities | 24,150,235 | 27,804,224 |
Revolving line of credit | 18,500,000 | 20,000,000 |
Operating Lease, Liability, Noncurrent | 2,076,472 | |
Other long-term liabilities | 8,737,323 | 9,319,143 |
Total liabilities | 53,464,030 | 57,123,367 |
Commitments and contingencies | ||
Shareholders’ equity: | ||
Common stock – no par value; 100,000,000 shares authorized; 15,263,555 and 15,481,497 shares issued and outstanding as of December 31, 2019 and 2018, respectively | 49,914,478 | 51,098,613 |
Retained earnings | 1,208,395 | 4,746,154 |
Total shareholders’ equity | 51,122,873 | 55,844,767 |
Noncontrolling interests | (37,620) | (274,266) |
Total equity | 51,085,253 | 55,570,501 |
Total liabilities and equity | $ 104,549,283 | $ 112,693,868 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
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 | 15,263,555 | 15,481,497 |
Common stock, number of shares outstanding | 15,263,555 | 15,481,497 |
Consolidated Statements of Inco
Consolidated Statements of Income and Comprehensive Income (Loss) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenues: | |||
Revenues | $ 47,533,637 | $ 40,741,765 | $ 41,150,131 |
Costs and expenses: | |||
Cost of products sold | 8,752,020 | 7,378,095 | 7,370,585 |
Selling and marketing | 21,429,040 | 20,258,307 | 21,492,937 |
Research and development | 6,478,592 | 7,575,892 | 4,280,385 |
General and administrative | 10,362,433 | 10,150,777 | 9,651,350 |
Amortization | 4,134,557 | 2,769,466 | 2,436,222 |
Total costs and expenses | 51,156,642 | 48,132,537 | 45,231,479 |
Operating income (loss) | (3,623,005) | (7,390,772) | (4,081,348) |
Interest income | 243,364 | 564,484 | 299,326 |
Interest expense | (246,186) | (195,848) | (92,904) |
Income (loss) before income taxes | (3,625,827) | (7,022,136) | (3,874,926) |
Income tax (expense) benefit | 79,316 | (16,636) | (4,174,889) |
Net income (loss) | (3,546,511) | (7,038,772) | (8,049,815) |
Net loss at subsidiary attributable to noncontrolling interests | 8,752 | 75,704 | 71,182 |
Net income (loss) attributable to common shareholders | $ (3,537,759) | $ (6,963,068) | $ (7,978,633) |
Earnings (loss) per share attributable to common shareholders: | |||
Basic (in USD per share) | $ (0.23) | $ (0.45) | $ (0.50) |
Diluted (in USD per share) | $ (0.23) | $ (0.45) | $ (0.50) |
Weighted-average common shares outstanding: | |||
Basic (in shares) | 15,396,098 | 15,614,052 | 15,911,577 |
Diluted (in shares) | 15,396,098 | 15,614,052 | 15,911,577 |
Comprehensive income (loss) attributable to common shareholders | $ (3,537,759) | $ (6,963,068) | $ (7,978,633) |
Net loss at subsidiary attributable to noncontrolling interests | 8,752 | 75,704 | 71,182 |
Total comprehensive income (loss) | (3,546,511) | (7,038,772) | (8,049,815) |
Product | |||
Revenues: | |||
Revenues | 45,552,587 | 40,200,832 | 40,376,563 |
Other | |||
Revenues: | |||
Revenues | $ 1,981,050 | $ 540,933 | $ 773,568 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash flows from operating activities: | |||
Net income (loss) | $ (3,546,511) | $ (7,038,772) | $ (8,049,815) |
Adjustments to reconcile net income (loss) to net cash flows provided by (used in) operating activities: | |||
Depreciation and amortization expense | 4,404,175 | 2,982,703 | 2,647,753 |
Deferred tax expense | 65,408 | 81,886 | 4,206,753 |
Share-based compensation | 1,485,898 | 1,364,698 | 1,115,063 |
Share-based compensation (foundation contribution) | 0 | 0 | 372,500 |
Excess tax (benefit) expense derived from exercise of stock options | 0 | (81,886) | (91,109) |
Decrease in non-cash contingent consideration | (804,167) | 0 | 0 |
Noncash interest expense | 47,525 | 99,883 | 77,911 |
Noncash investment gains | (26,315) | (168,440) | (52,012) |
Net changes in assets and liabilities affecting operating activities: | |||
Accounts receivable | (1,937,214) | 550,863 | (1,064,985) |
Inventories | 2,860,830 | 460,505 | (1,366,118) |
Prepaid, other current assets and other assets | (587,477) | 712,149 | (1,074,369) |
Accounts payable and other current liabilities | 1,824,024 | 4,308,706 | 2,307,617 |
Other long-term liabilities | (729,820) | (159,558) | 413,097 |
Net cash provided by (used in) operating activities | 3,056,356 | 3,112,737 | (557,714) |
Cash flows from investing activities: | |||
Additions to property and equipment | (246,202) | (455,569) | (275,960) |
Additions to intangible assets | (772,944) | (3,819,486) | (1,213,110) |
Cash paid for acquisition | (5,000,000) | (20,000,000) | 0 |
Proceeds from sale of marketable securities | 20,062,132 | 16,122,376 | 13,381,061 |
Purchases of marketable securities | (11,745,138) | (19,572,139) | (2,379,414) |
Net cash provided by (used in) investing activities | 2,297,848 | (27,724,818) | 9,512,577 |
Cash flows from financing activities: | |||
Borrowings on line of credit | 76,000,000 | 56,000,000 | 24,500,000 |
Repayments on line of credit | (77,500,000) | (45,800,000) | (18,800,000) |
Repurchase of common shares | (3,494,921) | (2,879,426) | (3,724,375) |
Payments of deferred equity offering costs | 0 | (383,310) | (27,950) |
Sales of shares of common stock, net of offering costs | 0 | 200,909 | 0 |
Payments of financing costs | (52,500) | 0 | 0 |
Cash payments of contingent consideration | (1,033,108) | 0 | 0 |
Sale of subsidiary shares to noncontrolling interest | 1,000,000 | 0 | 0 |
Net cash provided by (used in) financing activities | (5,080,529) | 7,138,173 | 1,947,675 |
Net increase (decrease) in cash and cash equivalents | 273,675 | (17,473,908) | 10,902,538 |
Cash and cash equivalents, beginning of year | 27,938,960 | 45,412,868 | 34,510,330 |
Cash and cash equivalents, end of year | 28,212,635 | 27,938,960 | 45,412,868 |
Net cash paid (refunded) during the year for: | |||
Interest | 198,661 | 95,965 | 14,993 |
Income taxes | 16,694 | 15,441 | 18,000 |
Noncash investing and financing activities: | |||
Change in unpaid invoices for purchases of intangibles | (576,837) | (539,467) | (513,481) |
Deferred offering costs included in accounts payable and other accrued expenses | 0 | 0 | 97,254 |
Non cash increase in liabilities related to acquisition (see Note 3) | 0 | 14,034,000 | 0 |
Recognition of operating lease assets and liabilities through adoption of ASC 842 | 3,629,320 | ||
Vesting of shares related to RediTrex approval | 862,200 | 0 | 0 |
Repurchase of subsidiary shares from noncontrolling interests | (800,000) | 0 | 0 |
Additions to intangible assets from final purchase price allocation | $ 148,000 | $ 0 | $ 0 |
Consolidated Statements of Equi
Consolidated Statements of Equity - USD ($) | Total | Common stock | Retained earnings | Noncontrolling interest |
Equity, balance at Dec. 31, 2016 | $ 73,120,819 | $ 54,643,268 | $ 18,604,931 | $ (127,380) |
Equity, common shares outstanding at Dec. 31, 2016 | 16,074,176 | |||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | ||||
Net income (loss) attributable to common shareholders | (7,978,633) | (7,978,633) | ||
Net loss at subsidiary attributable to noncontrolling interests | (71,182) | (71,182) | ||
Net income (loss) | (8,049,815) | |||
Repurchase of subsidiary shares to noncontrolling interest | 0 | |||
Share-based compensation, amount | 1,115,063 | $ 1,115,063 | ||
Share-based compensation, shares | 146,275 | |||
Exercise of options and related tax benefit | 372,500 | $ 372,500 | ||
Exercise of options and related tax benefit, shares | 50,000 | |||
Repurchase of common shares | (3,719,890) | $ (3,719,890) | ||
Repurchase of common shares, shares | (547,376) | |||
Equity, balance at Dec. 31, 2017 | 63,921,601 | $ 52,410,941 | 11,709,222 | (198,562) |
Equity, common shares outstanding at Dec. 31, 2017 | 15,723,075 | |||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | ||||
Net income (loss) attributable to common shareholders | (6,963,068) | (6,963,068) | ||
Net loss at subsidiary attributable to noncontrolling interests | (75,704) | (75,704) | ||
Net income (loss) | (7,038,772) | |||
Repurchase of subsidiary shares to noncontrolling interest | 0 | |||
Share-based compensation, amount | 1,364,698 | $ 1,364,698 | ||
Share-based compensation, shares | 170,759 | |||
Proceeds from sale of common stock, net of offering costs | 200,909 | $ 200,909 | ||
Proceeds from the sale of common stock, net of offering costs, shares | 30,704 | |||
Repurchase of common shares | (2,877,935) | $ (2,877,935) | ||
Repurchase of common shares, shares | (443,041) | |||
Equity, balance at Dec. 31, 2018 | $ 55,570,501 | $ 51,098,613 | 4,746,154 | (274,266) |
Equity, common shares outstanding at Dec. 31, 2018 | 15,481,497 | 15,481,497 | ||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | ||||
Net income (loss) attributable to common shareholders | $ (3,537,759) | (3,537,759) | ||
Net loss at subsidiary attributable to noncontrolling interests | (8,752) | (8,752) | ||
Net income (loss) | (3,546,511) | |||
Repurchase of subsidiary shares to noncontrolling interest | (800,000) | $ (685,805) | (114,195) | |
Sale of subsidiary shares to noncontrolling interest | 1,000,000 | 640,407 | 359,593 | |
Vesting of common stock | 862,200 | $ 862,200 | ||
Vesting of common stock, shares | 180,000 | |||
Share-based compensation, amount | 1,485,898 | $ 1,485,898 | ||
Share-based compensation, shares | 225,536 | |||
Repurchase of common shares | (3,486,835) | $ (3,486,835) | ||
Repurchase of common shares, shares | (623,478) | |||
Equity, balance at Dec. 31, 2019 | $ 51,085,253 | $ 49,914,478 | $ 1,208,395 | $ (37,620) |
Equity, common shares outstanding at Dec. 31, 2019 | 15,263,555 | 15,263,555 |
Valuation and Qualifying Accoun
Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2019 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
Valuation and Qualifying Accounts | Valuation and Qualifying Accounts Years ended December 31, 2019, 2018 and 2017 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: 2017 $ 449,859 $ 5,066,526 $ — $ (5,008,851) (1) $ 507,534 2018 507,534 5,932,248 — (5,446,442) (1) 993,340 2019 993,340 7,010,141 — (7,195,470) (1) 808,011 Valuation allowance for deferred tax assets: For the years ended December 31: 2017 $ 388,500 $ (665,039) (2) $ 15,908,774 $ — $ 15,632,235 2018 15,632,235 1,749,817 — — 17,382,052 2019 17,382,052 1,129,109 — — 18,511,161 (1) Composed of actual returns and credits for chargebacks and cash discounts. (2) Amount includes $4,202,854 related to increase in the valuation allowance during the year, net of $4,867,893 related to the revaluation of deferred income tax balances for new rates under the Tax Act. |
Organization
Organization | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | Organization Cumberland Pharmaceuticals Inc. (“Cumberland,” the “Company,” or as used in the context of “we,” “us,” or “our”) 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. The Company promotes its approved products through its hospital and field sales forces in the United States and is establishing a network of international partners to bring its medicines to patients in their countries. 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 and manufacturing professionals. The Company works closely with its third-party distribution partners 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. In 2014, the Company organized equity financing to recapitalize and strengthen the financial position of CET including an investment of approximately $1.0 million from Gloria Pharmaceuticals Co., Ltd. (“Gloria”). As a result, Gloria received shares in CET and joined the CET ownership group. In April, 2019, CET entered into an agreement with HongKong WinHealth Pharma Group Co. Limited (WinHealth) whereby WinHealth made a $1.0 million investment through the purchase of shares of CET stock. As part of the agreement, WinHealth obtained a Board position at CET and the first opportunity to license CET products for the Chinese market. In connection with WinHealth's investment in CET, Cumberland also made an additional $1.0 million investment in CET. Cumberland purchased additional CET shares through contribution of $0.3 million in cash and a conversion of $0.7 million in intercompany loans payable. Upon completion of the additional investment by WinHealth and Cumberland, Gloria Pharmaceuticals agreed to return its shares in CET in exchange for consideration of $0.8 million. The Company's ownership in CET is now 85%. As noted above, the ownership interests of CET includes WinHealth 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 $8,752, $75,704 and $71,182 for the years ended December 31, 2019, 2018 and 2017, 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, 2019 | |
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 requires 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 (2) the allowances for obsolescent or unmarketable inventory (3) assumptions used in estimating acquisition date fair value of assets acquired in business combinations and (4) valuation of contingent consideration liability associated with business combinations. 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 $1.5 million, $2.1 million and $1.6 million for the years ended December 31, 2019, 2018 and 2017, 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, contingent consideration liability 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. The Company believes that the valuations provided by the third-party pricing service, as derived from such services' pricing models, represent prices that would be received to sell the assets at the measurement date (exit prices). The Company's contingent consideration liability is a Level 3 fair value measurement that is updated on a recurring basis at each reporting period using a valuation model. Consistent with Level 3 fair value measurements, there are significant inputs to the valuation model that are unobservable. Cash and Cash Equivalents Cash and cash equivalents include highly liquid investments with original maturities of three months or less. As of December 31, 2019 and 2018, cash equivalents consist primarily of money market funds as well as trading securities with original maturities of less than ninety days. Marketable Securities The Company invests in marketable debt securities in order to maximize its return on cash. Marketable securities consist of short-term cash investments, U.S. Treasury notes and bonds, corporate bonds, and commercial paper. 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, 2019 and 2018, 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. As of December 31, 2019, all the trading securities were commercial paper with original maturities of less than ninety days and as a result, were classified as cash equivalents. 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 collection status. The majority of the Company’s products are distributed through independent pharmaceutical wholesalers. The allowances against accounts receivable for chargebacks and discounts 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 and expired product. The allowances in accounts receivable for chargebacks, cash discounts and damaged goods were $0.8 million at December 31, 2019 and $0.9 million at December 31, 2018. 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 conjunction with recognizing a sale to a wholesaler, revenues are reduced and accrued liabilities are increased by the Company’s estimate of the rebate that may be claimed as well as the reserves for expired and damaged goods. Cash discounts are reductions to invoiced amounts offered to customers for payment within a specified period of time from the date of the invoice. 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. As discussed below, effective January 1, 2017, inventories are stated at the lower of cost or net realizable value with cost determined using the first-in, first-out method. The Company continually evaluates inventories for potential losses due to expired, short-dated 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. The Company classifies the Vibativ inventories that it does not expect to sell within one year as non-current inventories. Prepaid and Other Current Assets Prepaid and other current assets consist of deferred offering costs, prepaid insurance premiums, prepaid consulting services, deposits and annual fees paid to the U.S. Food and Drug Administration ("FDA"). The Company expenses all prepaid and other current asset amounts as used or over the period of benefit primarily on a straight-line basis, as applicable. Deferred offering costs are expenses directly related to the Form S-3 or Shelf Registration filed with the SEC on November 11, 2017 and declared effective on January 16, 2018. These costs consist of legal, accounting, printing, and filing fees that the Company has capitalized. Deferred costs associated with the Shelf Registration will be reclassified to additional paid in capital on a pro-rata basis as the Company completes sales of shares under the Shelf Registration, with any remaining deferred offering costs to be charged to the results of operations at the end of the three-year life of the Shelf Registration. During the year ended December 31, 2019, the Company has not expensed any deferred offering costs associated with the Shelf Registration. 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 (loss) 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 and Goodwill The Company’s intangible assets and goodwill consist of capitalized costs related to product and license rights, patents, trademarks and goodwill obtained in the Vibativ acquisition. Goodwill is not amortized for financial reporting purposes, but is subject to impairment analysis at least annually. 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 several factors. This includes the term of the license agreement, the patent life or market exclusivity of the product and as well as management's expectations of continued involvement with the product and the assessment of future sales, the future periods under which the product will be sold and the 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, operating lease right-of-use assets 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. Goodwill and other indefinite lived intangible assets that are not subject to amortization are tested at least annually for impairment. The impairment analysis for goodwill requires a comparison of fair value to the carrying value of the reporting unit. The Company's goodwill was acquired in November 2018 with the Vibativ acquisition. As a result, the Vibativ component of the Company is the reporting unit evaluated for goodwill impairment. Cumberland determined the fair value of the reporting unit through current and future estimated revenue and profitability of the product. The Company recorded no impairment charges during 2019, 2018 and 2017. Revenue Recognition Effective January 1, 2018, the Company adopted the Financial Accounting Standards Board’s (“FASB”) amended guidance in the form of Accounting Standards Update (“ASU”) No. 2014-09, "Revenue from Contracts with Customers," (ASC 606). Results for reporting periods beginning after January 1, 2018 are presented under ASC 606, while prior period amounts were not adjusted and are reported in accordance with ASC 605. Net Product Revenue Revenues from product sales are recognized in the amount that reflects the consideration that we expect to receive for these goods. Depending upon the shipping terms of the transaction, the revenue is recognized.at the point where the customer obtains control of the goods and we satisfy our performance obligation. This occurs upon either shipment of the product or arrival at its ship to destination. Payment terms typically range from 30 to 60 days from date of shipment. 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, coupons, product returns, and certain administrative and service fees. Significant judgments must be made in determining the transaction price for our sales of products related to these adjustments. Sales Rebates and Discounts The allowances against accounts receivable for chargebacks, discounts, expired 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 and expired 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 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. Sales Returns 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, expiration date by product as well as any other factor expected to impact future returns. Any changes in the assumptions used to estimate the provision for returns are recognized in the period those assumptions are changed. 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. 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 as well as any adjustment in the net realizable value of inventory acquired in acquisitions. Cost of products sold also includes expenses associated with the reduction in the net realizable value 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 are included as a component of selling and marketing expenses in the consolidated statements of operations. Distribution costs were as follows for the years ended December 31: 2019 2018 2017 Distribution costs $ 794,317 $ 618,756 $ 621,142 Advertising Costs Advertising costs are expensed as incurred and are included as a component of selling and marketing expenses in the consolidated statements of operations. Advertising costs were as follows for the years ended December 31: 2019 2018 2017 Advertising costs $ 2,690,280 $ 2,219,074 $ 2,589,185 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. Research and 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 over the period of time the clinical trials are performed. 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 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 (loss) per share is calculated by dividing net income (loss) 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 (loss) per share is calculated by assuming the vesting of unvested restricted stock and the exercise of stock options and warrants and unrecognized compensation costs. 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 preclinical 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. Reclassification of prior period amounts The Company has made certain reclassifications to prior period amounts to conform to the current-year presentation of the reporting of research and development expense and general and administrative expense on the consolidated statements of operations. Certain costs and expenses related to research and development were previously reported as general and administrative expenses on the consolidated statements of operations. These reclassifications have no effect on the reported operating loss or equity for the years ended December 31, 2018 and 2017. Recent Accounting Guidance Recent Adopted Accounting Pronouncements In May 2014, the FASB issued amended guidance in the form of ASU No. 2014-09, “Revenue from Contracts with Customers” (“ASC 606”). 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 replaced most of the existing revenue recognition standards in U.S. GAAP when it became effective. In July 2015, the FASB issued a one-year deferral of the adoption date, which extended the effective date for us to January 1, 2018, at which point Cumberland adopted the standard. The Company evaluated its revenues and the new guidance had immaterial impacts to recognition practices upon adoption on January 1, 2018. As part of the adoption, the Company elected to apply the new guidance on a modified retrospective basis. The Company did not record a cumulative effect adjustment to historical retained earnings for initially applying the new guidance as no revenue recognition differences were identified in the timing or amount of revenue. In February 2016, the Financial Accounting Standards Board ("FASB") issued guidance in the form of a FASB Accounting Standards Update ("ASU") No. 2016-02, “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 twelve months. Leases will be classified as either finance (formerly "capital leases") or operating, with classification affecting the pattern of expense recognition in the income statement. The standard provides for a modified retrospective transition approach 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. In July 2018, the FASB issued ASU 2018-11, "Leases: Targeted Improvements", allowing for an alternative transition method (the effective date approach). It allows an entity to initially apply the new lease guidance at the adoption date (rather than at the beginning of the earliest period presented). Cumberland adopted the lease guidance effective January 1, 2019 using the package of transition practical expedients. This allowed the Company to retain the lease classification for any leases existing prior to adoption, in addition to other benefits. See additional discussion of the impact of adopting the lease accounting guidance in Note 15. Recent Accounting Pronouncements - Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments-Credit Losses,” which changes the impairment model for most financial assets and certain other instruments. For trade and other receivables, held-to-maturity debt securities, loans and other instruments, companies will be required to use a new forward-looking “expected loss” model that generally will result in the earlier recognition of allowances for losses. For available-for-sale debt securities with unrealized losses, companies will measure credit losses in a manner similar to what they do today, except that the losses will be recognized as allowances rather than as reductions in the amortized cost of the securities. Companies will have to disclose more information, including the information they use to track credit quality by year of origination for most financing receivables. Companies will apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. This standard is effective for the Company on January 1, 2020. The Company continues to evaluate this new standard on its trade and other receivables but does not expect a material impact on its consolidated financial statements. In May 2019, the FASB issued ASU 2019-05, "Financial Instruments-Credit Losses (Topic 326): Targeted Transition Relief" which provides transition relief for ASU 2016-13 by providing entities with an alternative to irrevocably elect the fair value option for eligible financial assets measured at amortized cost upon adoption of the new credit losses standard. Certain eligibility requirements must be met, the election must be applied on an instrument-by-instrument basis, and the election is not available for either available-for-sale or held-to-maturity debt securities. The effective date is the same as ASU 2016-13, January 1, 2020. The Company continues to evaluate this new standard but does not expect a material impact on its consolidated financial statements. In November 2018, the FASB issued ASU No. 2018-18, “Collaboration Arrangements: Clarifying the Interaction between Topic 808 and Topic 606” (ASU 2018-18). The issuance of ASU 2014-09 raised questions about the interaction between the guidance on collaborative arrangements and revenue recognition. ASU 2018-18 addresses this uncertainty by (1) clarifying that certain transactions between collaborative arrangement participants should be accounted for as revenue under ASU 2014-09 when the collaboration arrangement participant is a customer, (2) adding unit of account guidance to assess whether the collaboration arrangement or a part of the arrangement is with a customer and (3) precluding a company from presenting transactions with collaboration arrangement participants that are not directly related to sales to third parties together with revenue from contracts with customers. The new standard will be effective for the Company on January 1, 2020. The Company continues to evaluate this new standard but does not expect a material impact on its consolidated financial statements. |
Omeclamox_-Pak, RediTrex_ and V
Omeclamox®-Pak, RediTrex® and Vibativ® | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Omeclamox®-Pak, RediTrex® and Vibativ® | Omeclamox ® -Pak, RediTrex ® and Vibativ ® Omeclamox-Pak In December 2018, Cumberland completed an agreement with Gasto-enterlogics Inc. ("GEL") to acquire the remaining product rights associated with Omeclamox-Pak including the product’s FDA-approved New Drug Application and the domestic and international trademarks. As part of the transaction, which was accounted for as an asset acquisition, Cumberland paid $2.3 million during 2018 and ended Cumberland’s payments of royalties and manufacturing fees to GEL. The Company has now assumed responsibility for the maintenance of the product’s FDA approval and for the oversight of the product’s manufacturing and packaging. This agreement follows the November 2015 agreement between Cumberland and GEL to assume the remaining commercial rights to Omeclamox-Pak for the United States. The Company had previously signed an agreement with Pernix Therapeutics ("Pernix") to jointly commercialize the product in the United States in October 2013. As part of the November 2015 GEL Agreement, Cumberland and Pernix terminated their arrangements. The $4.0 million upfront payment that the Company paid in October 2013 to Pernix along with the payments made to GEL during 2018 are included in product and license rights and are being amortized over the remaining expected useful life of the acquired asset. The Company evaluated the remaining expected useful life and maintained the existing estimated life of the product, June 2032. Omeclamox-Pak contributed $0.8 million, $0.6 million, and $1.8 million in net revenues during 2019, 2018, and 2017, respectively. RediTrex 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 as an asset purchase. The products are designed for the treatment of active rheumatoid arthritis, juvenile idiopathic arthritis, severe psoriatic arthritis, and severe disabling psoriasis. Under the terms of the Agreement, Cumberland is responsible for the products’ FDA submission and registration. As consideration for the license, at closing, Cumberland paid a deposit of $100,000. The Company also recorded a liability of $0.9 million that will be settled through 180,000 unvested restricted shares of Cumberland common stock that vest upon the FDA approval of the first Nordic product. Cumberland also agreed to provide Nordic a series of payments tied to the products’ FDA approval, launch and achievement of certain sales milestones. Nordic is responsible for manufacturing and supply of the products. On November 27, 2019, Cumberland received FDA approval of the pre-filled syringe. The 180,000 shares of restricted Cumberland common stock vested and were valued at $0.9 million on the vesting date. In addition, the FDA approval resulted in an additional $1.0 million liability to Nordic that will be paid during 2020. The value of the then unvested restricted Cumberland common stock shares was a liability of $1.1 million at December 31, 2018. Vibativ During November 2018, the Company closed on an agreement with Theravance Biopharma ("Theravance") to acquire the global responsibility for Vibativ including the marketing, distribution, manufacturing and regulatory activities associated with the brand. Vibativ is a patented, FDA approved injectable anti-infective for the treatment of certain serious bacterial infections including hospital-acquired and ventilator-associated bacterial pneumonia and complicated skin and skin structure infections. It addresses a range of Gram-positive bacterial pathogens, including those that are considered difficult-to-treat and multidrug-resistant. Cumberland acquired Vibativ to further add to its product offerings, increase its net revenue and positively contribute to the Company's operating results. Cumberland expects to deduct the goodwill acquired in the acquisition for tax purposes. Cumberland has accounted for the transaction as a business combination in accordance with ASC 805 and the product sales are included in the results of operations subsequent to the acquisition date. The Company paid an upfront payment of $20.0 million at closing and a $5.0 million cash payment during early 2019. In addition, Cumberland agreed to pay a royalty of up to 20% on future net sales of the product. The future royalty payments were required to be recognized at their acquisition-date fair value as part of the contingent consideration transferred in the business combination. The following table summarizes the initial payments and consideration for the business combination: Consideration: Cash paid at closing $ 20,000,000 Cash payment during early 2019 5,000,000 Fair value of contingent consideration - net sales royalty 9,182,000 Total consideration $ 34,182,000 The contingent consideration liability represents the future net sales royalty payments discussed above. Cumberland prepared the valuations of the contingent consideration liability and the intangible assets utilizing significant unobservable inputs. As a result, the valuations are classified as Level 3 fair value measurements. The Company will continue to evaluate the assets acquired and liabilities assumed during the measurement period. The following table presents the changes in the Company's Level 3 contingent consideration liability that is measured at fair value on a recurring basis. The current and long-term portions of this liability are disclosed in Note 8. The contingent consideration earned and accrued in operating expenses is paid to the seller quarterly. Contingent consideration liability Balance at November 12, 2018 $ 9,034,000 Change in fair value of contingent consideration included in operating expenses (40,000) Contingent consideration earned and accrued in operating expenses 508,000 Balance at December 31, 2018 9,502,000 Adjustment to initial fair value of the contingent consideration liability 148,000 Cash payment of royalty during the period (1,033,108) Change in fair value of contingent consideration included in operating expenses (804,167) Contingent consideration earned and accrued in operating expenses 820,864 Balance at December 31, 2019 $ 8,633,589 The following table summarizes the allocation of the fair values of the assets acquired as of the acquisition date for Vibativ: Finished goods inventory $ 6,624,000 Work in process - unlabeled vials 3,970,000 Work in process - validation vials 1,827,000 Raw materials 9,129,000 Total inventory $ 21,550,000 Intellectual property amortizable intangible assets $ 11,750,000 Goodwill 882,000 Total intangibles and goodwill $ 12,632,000 Total assets acquired $ 34,182,000 |
Revenues
Revenues | 12 Months Ended |
Dec. 31, 2019 | |
Revenues [Abstract] | |
Revenues | Revenues Product Revenues The Company’s net product revenues consisted of the following for the years ended December 31: 2019 2018 2017 Products: Acetadote $ 3,824,449 $ 4,284,111 $ 6,576,720 Omeclamox-Pak 837,829 623,297 1,761,868 Kristalose 12,895,120 12,055,625 11,455,805 Vaprisol 936,615 1,763,874 1,576,222 Caldolor 5,222,281 5,001,997 4,178,443 Ethyol 12,774,831 10,545,906 10,835,038 Totect 369,912 850,965 3,992,467 Vibativ 8,691,550 5,075,057 — Total net product revenues $ 45,552,587 $ 40,200,832 $ 40,376,563 Other Revenues During 2019, Cumberland executed a License and Distribution agreement with HongKong WinHealth Pharma Group Co. Limited (“WinHealth”) for our Caldolor and Acetadote brands in China and Hong Kong. In conjunction with these new arrangements, the Company terminated a previous License and Distribution agreement with Gloria Pharmaceuticals Co ("Gloria Pharmaceuticals") for the two brands. In addition, we also signed a new License and Distribution agreement with DB Pharm Korea Co., Ltd. (“DB Pharm”) for Vibativ in South Korea. As a result of these agreements, Cumberland recognized approximately $0.3 million of non-refundable up-front payments as other revenue in the consolidated statement of operations during 2019. 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 payments upon the partners' achievement of defined regulatory approvals and sales milestones. The Company will recognize revenue for these achievements once it is probable that these consideration amounts are no longer constrained. The Company is also entitled to receive royalties on future sales of the products under the agreements. The international agreements provide for $1.0 million in non-refundable up-front payments, milestone payments of up to $2.2 million related to regulatory approvals and up to $4.8 million in payments related to product sales. From 2012 through December 31, 2019, the Company has recognized a cumulative $1.2 million in upfront payments as other revenue and has recognized $0.1 million in revenue related to the milestone payments associated with these international agreements. Other revenues during 2019, 2018 and 2017 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 $1.3 million, $0.1 million, and $0.2 million for the years ending December 31, 2019, 2018 and 2017, respectively. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories The Company's net inventories consisted of the following as of December 31: 2019 2018 Raw materials and work in process $ 19,345,723 $ 18,378,450 Consigned inventory 416,468 937,006 Finished goods, net of reserve 5,204,321 8,511,887 Total inventories 24,966,513 27,827,343 less non-current inventories (15,554,992) (15,749,000) Total inventories classified as current $ 9,411,521 $ 12,078,343 The Company continually evaluates inventories for potential losses due to expired, short-dated 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. At December 31, 2019 and 2018, the Company had recognized and maintained cumulative charges for potential obsolescence and discontinuance losses of approximately $0.1 million and $0.3 million, respectively. At December 31, 2019 there were no cumulative obsolescence or discontinuance losses necessary. 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 packagers. 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, 2019 and 2018. Consigned inventory represents Authorized Generic inventory stored with Perrigo until shipment. As part of the Vibativ acquisition, Cumberland acquired API and work in process inventories of $15.7 million that are classified as non-current inventories at December 31, 2018. At December 31, 2019, the Vibativ non-current inventory was $15.3 million. Although the Company did not have any finished goods included in the non-current |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2019 | |
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 2019 2018 Computer equipment 3 – 5 years $ 1,260,630 $ 1,148,140 Office equipment 3 – 15 years 878,350 809,153 Furniture and fixtures 5 – 15 years 646,505 639,267 Leasehold improvements 3 – 15 years, or remaining lease term 1,356,640 1,299,363 Total property and equipment, gross 4,142,125 3,895,923 Less: accumulated depreciation and amortization (3,394,329) (3,124,710) Total property and equipment, net $ 747,796 $ 771,213 Depreciation expense, including amortization expense related to leasehold improvements, is included in general and administrative expense in the consolidated statements of operations. Depreciation expense was as follows for the years ended December 31: 2019 2018 2017 Depreciation expense $ 269,619 $ 213,237 $ 211,532 |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Intangible Assets and Goodwill Intangible assets and Goodwill consisted of the following at December 31: 2019 2018 Product and license rights $ 37,400,742 $ 36,573,941 Less: accumulated amortization (11,499,141) (8,405,188) Total product and license rights 25,901,601 28,168,753 Patents 9,882,511 9,428,266 Less: accumulated amortization (5,127,878) (4,087,273) Total patents 4,754,633 5,340,993 Trademarks 273,110 154,373 Less: accumulated amortization (9,020) (9,020) Total trademarks 264,090 145,353 Total intangible assets $ 30,920,324 $ 33,655,099 Goodwill $ 882,000 $ 784,000 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 during October 2013 and the $2.3 million payments made to GEL during 2018 (discussed more fully in Note 3) are included in product and license rights and are being amortized through June 2032, the remaining expected useful life of the acquired asset. During 2014, the Company acquired the rights of the branded prescription product Vaprisol from Astellas. The intangible asset value is $3.0 million and is included in product and license rights. The asset is being amortized through February 2022, the remaining expected useful life of the acquired asset, which coincides with the life of the primary intellectual property asset. As discussed in Note 3, in November 2016, the Company acquired the U.S. rights to Nordic Group B.V.’s injectable methotrexate product line as an asset purchase. The agreement requires the Company to provide unvested restricted shares of Cumberland common stock and make a series of payments tied to the products’ FDA approval, launch and achievement of certain sales milestones. The payments are being treated as consideration for the assets acquired and are being capitalized and amortized over the expected useful life of the acquired asset. To date, the intangible assets related to the product include the $100,000 deposit paid at closing, the 180,000 restricted shares valued at $0.9 million that vested upon the November 2019 FDA approval and the additional $1.0 million owed to Nordic during 2020, also based on the FDA approval. As discussed in Note 3, during November 2018, the Company acquired Vibativ from Theravance. This resulted in amortizable intangible assets related to the product rights of $11.8 million and goodwill of $0.9 million. The intangible assets are being amortized through November 2028, the expected useful life of the acquired asset. The $0.1 million increase in goodwill during 2019 was a result of changes in the purchase price allocation during the measurement period. During 2019 and 2018, the Company recorded an additional $0.7 million and $0.4 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 were as follows for the years ended December 31: 2019 2018 2017 Amortization expense $ 4,134,557 $ 2,769,466 $ 2,436,222 The expected amortization expense for the Company's current balance of intangible assets are as follows: Year ending December 31: 2020 $ 4,286,336 2021 4,084,702 2022 3,530,879 2023 3,743,526 2024 and thereafter 15,274,881 $ 30,920,324 |
Other Current and Other Long-te
Other Current and Other Long-term Liabilities | 12 Months Ended |
Dec. 31, 2019 | |
Other Liabilities, Current [Abstract] | |
Other Current and Other Long-term Liabilities | Other Current and Other Long-term Liabilities Other current liabilities consisted of the following at December 31: Other current liabilities 2019 2018 Rebates, product returns, administrative fees and service fees $ 4,825,657 $ 5,635,972 Employee wages and benefits 1,295,905 1,263,426 Stock payable — 1,085,400 Current portion of accrued contingent consideration 2,374,776 2,290,000 Deferred acquisition liability — 5,000,000 Accrued inventory purchases 829,047 434,405 Accrued payment for asset purchase 1,000,000 — Other 991,973 1,001,724 Total other current liabilities $ 11,317,358 $ 16,710,927 Other long-term liabilities 2019 2018 Noncurrent portion of accrued contingent consideration $ 6,258,813 $ 7,212,000 Deferred compensation 2,278,164 1,588,123 Other 200,346 519,020 Total other long-term liabilities $ 8,737,323 $ 9,319,143 |
Debt
Debt | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Debt | Debt On May 10, 2019, the Company entered into a third amendment ("Third Amendment") to the Revolving Credit Loan Agreement, dated July 28, 2017, with Pinnacle Bank (“Pinnacle Agreement”). The Third Amendment extended the term of the Pinnacle Agreement through July 31, 2021 as well as modified certain definitions and terms of the existing financial covenants, including the definition of the Funded Debt Ratio and the compliance target of the Tangible Capital Ratio. Both Third Amendment modifications were related to the Vibativ transaction. Under the Pinnacle Agreement, Cumberland was initially subject to one financial covenant, the maintenance of a Funded Debt Ratio, as such term is defined in the agreement and determined on a quarterly basis. On August 14, 2018, the Company amended the Pinnacle Agreement ("First Amendment") to replace the single financial covenant with the maintenance of either the Funded Debt Ratio or a Tangible Capital Ratio, as defined in the First Amendment. The Company achieved compliance with the Tangible Capital Ratio financial covenant as of December 31, 2019. The initial revolving line of credit under the Pinnacle Agreement was for up to an aggregate principal amount of $12.0 million with the ability to increase the principal amount available for borrowing up to $20.0 million, upon the satisfaction of certain conditions. On October 17, 2018, the Company entered into a second amendment (“Second Amendment”) which increased the maximum aggregate principal available for borrowing under the Pinnacle Agreement to $20.0 million. The Company had $18.5 million in borrowings under the Pinnacle Agreement at December 31, 2019 and $20.0 million at December 31, 2018. |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Dec. 31, 2019 | |
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 million 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, 2019 and 2018, there was no preferred stock outstanding. (c) Common Stock During 2019, 2018 and 2017, the Company issued 225,536 shares, 170,759 shares, and 146,275 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 2016. There were no option exercise transactions during 2019, 2018 and 2017. In January 2018, the Company's Form S-3 or Shelf Registration associated with the sale of up to $100 million in corporate securities was declared effective. The Shelf Registration also included an At-the-Market ("ATM") feature enabling the Company to sell common shares at market prices, along with an agreement with B. Riley FBR to support such a placement of shares. (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 2017. 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 expired in July 2019. As of December 31, 2019, there were no outstanding warrants. (e) Share Repurchases The Company currently has a share repurchase program to repurchase up to $10 million of its common stock pursuant to Rule 10b-18 of the Securities Act. In January 2019, the Company's Board of Directors established the current $10 million repurchase program to replace the prior authorizations. The Company repurchased 623,478 shares, 443,041 shares and 547,376 shares of common stock for approximately $3.5 million, $2.9 million, and $3.7 million during the years ended December 31, 2019, 2018 and 2017, respectively. There remains $8.0 million available under the current repurchase program available for share repurchases at December 31, 2019. (f) Cumberland Emerging Technologies In April 2019, Cumberland Emerging Technologies ("CET"), our majority-owned subsidiary, entered into an agreement with WinHealth whereby WinHealth made a $1 million investment through the purchase of shares of CET stock. As part of the agreement, WinHealth obtained a Board position at CET and the first opportunity to license CET products for the Chinese market. In connection with WinHealth’s investment in CET, the Company also made an additional $1 million investment in CET. Cumberland purchased additional CET shares through contribution of $0.3 million in cash and a conversion of $0.7 million in intercompany loans payable. Upon completion of the additional investment by WinHealth and Cumberland, Gloria Pharmaceuticals agreed to return its shares in CET in exchange for consideration of $0.8 million. After the additional investment, the Company’s ownership in CET is 85%. As CET is a consolidated subsidiary, the Company reports the operating results of CET and allocates the noncontrolling interests to the non-majority partners. (g) Cumberland Foundation In December 2017, the Company formed the Cumberland Pharma Foundation (the "Foundation") to serve as a vehicle to facilitate the ongoing philanthropic endeavors of Cumberland Pharmaceuticals Inc. The Foundation was formed as a nonprofit corporation designed to qualify as a tax-exempt organization pursuant to Section 501(a) of the Internal Revenue Code. The Foundation’s Board of Directors is comprised of Cumberland Pharmaceuticals executives who are responsible for overseeing the Foundation’s ongoing activities including charitable contributions. In 2018, Cumberland provided a grant of 50,000 shares of the Company's common stock to the Foundation. The shares will address the ongoing financial needs of the organization, with most of the shares expected to be held for the opportunity to realize long term appreciation to support the Foundation’s future. The Foundation maintains separate financial statements and its ongoing operations will not impact the financial statements of Cumberland Pharmaceuticals. Initial annual grants by the Foundation have been and are expected to remain consistent with the historic level of contributions made by Cumberland Pharmaceuticals. During 2019, Cumberland Pharmaceuticals committed approximately $50,000 in cash contributions to be paid to the Foundation during 2020. (h) Nordic Group B.V. On November 27, 2019, Cumberland received approval from the FDA for the pre-filled syringe of the Methotrexate product. With this approval, Nordic's 180,000 shares of Cumberland's common stock became vested. The value of these shares at the date of approval was $0.9 million. |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 12 Months Ended |
Dec. 31, 2019 | |
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: 2019 2018 2017 Numerator: Net income (loss) attributable to common shareholders $ (3,537,759) $ (6,963,068) $ (7,978,633) Denominator: Weighted-average shares outstanding – basic 15,396,098 15,614,052 15,911,577 Dilutive effect of restricted stock and stock options — — — Weighted-average shares outstanding – diluted 15,396,098 15,614,052 15,911,577 The Company's anti-dilutive restricted shares and stock options outstanding were as follows for the years ended December 31: 2019 2018 2017 Anti-dilutive shares and options 4,000 41,650 18,325 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The components of the Company's net deferred tax assets at December 31 are as follows: 2019 2018 Deferred Tax Assets Net operating loss and tax credits $ 16,964,685 $ 16,410,403 Property and equipment and intangibles 227,072 236,318 Allowance for accounts receivable 257,564 251,068 Reserve for expired product 469,466 558,484 Inventory 35,227 193,150 Deferred charges 845,765 910,577 Cumulative compensation costs incurred on deductible equity awards 1,047,149 884,049 Total deferred tax assets 19,846,928 19,444,049 Deferred Tax Liabilities Intangible assets (1,313,965) (1,974,787) Net deferred tax assets, before valuation allowance 18,532,963 17,469,262 Less: deferred tax asset valuation allowance (18,511,161) (17,382,052) Net deferred tax assets $ 21,802 $ 87,210 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, 2019: Years of expiration Federal State 2020 $ — $ 13,115 2021 - 2029 — 49,392,824 2030 44,153,819 461,280 2031 - 2039 7,534,351 9,947,070 Indefinite Period 5,493,258 383,869 Total federal and state net operating loss carryforwards $ 57,181,428 $ 60,198,158 Income tax (expense) benefit includes the following components for the years ended December 31: 2019 2018 2017 Current: Federal $ 65,408 $ — $ — State and other 79,316 (16,636) (59,243) Total current income tax (expense) benefit 144,724 (16,636) (59,243) Deferred: Federal (65,408) — (3,682,772) State — — (432,874) Total deferred income tax (expense) benefit (65,408) — (4,115,646) Total income tax (expense) benefit $ 79,316 $ (16,636) $ (4,174,889) The Company’s effective income tax rate for 2019, 2018 and 2017 reconciles with the federal statutory tax rate as follows: 2019 2018 2017 Federal tax expense at statutory rate 21 % 21 % 34 % State income tax expense (net of federal income tax benefit) 4 % 4 % 4 % Permanent differences associated with general business credits 7 % 1 % 1 % Change in valuation allowance (31) % (25) % (148) % Change in tax rate — % — % 2 % Other permanent differences 1 % (1) % 1 % Other — % — % (2) % Net income tax expense 2 % — % (108) % In 2017, the Company determined that it was not more likely than not that its net deferred tax assets would be realized. As such, the Company’s income tax provision for the year ended December 31, 2017 reflected a full valuation allowance against net deferred tax assets with the exception of the deferred tax asset for alternative minimum tax (“AMT”) credit carryforwards discussed further below. The Company’s position is unchanged as of both December 31, 2018 and December 31, 2019. On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (“the Tax Act”). The Tax Act makes broad and complex changes to the U.S. tax code, including, but not limited to, (1) reducing the U.S. federal corporate tax rate to 21%; (2) eliminating the corporate alternative minimum tax (“AMT”) and changing how AMT credits can be realized; (3) capital expensing; and (4) creating new limitations on deductible interest expense and executive compensation. In connection with our analysis of the impact of the Tax Act, we recorded a net tax benefit of $0.1 million in the period ended December 31, 2017. This net tax benefit consisted entirely of the release of the valuation allowance against AMT credits that will be realizable under the Tax Act in future periods. The Company expects it will continue to pay minimal taxes in future periods through the continued utilization of net operating loss carryforwards, as it is able to achieve taxable income through its operations. The Company is no longer subject to U.S. federal tax examinations for tax years before 2016, and with few exceptions, the Company is not subject to examination by state tax authorities for tax years which ended before 2016. Loss carryforwards and credit carryforwards generated or utilized in years earlier than 2016 remain subject to examination and adjustment. During 2012, the 2009 federal tax return was examined by the Internal Revenue Service with no significant findings or adjustments. The Company has no unrecognized tax benefits in 2019, 2018 and 2017. |
Stock-Based Compensation Plans
Stock-Based Compensation Plans | 12 Months Ended |
Dec. 31, 2019 | |
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 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 consisted of the following for the years ended December 31: 2019 2018 2017 Share-based compensation - employees $ 1,481,016 $ 1,244,606 $ 1,032,094 Share-based compensation - nonemployees 4,882 120,092 82,969 Share-based compensation - foundation contribution — $ — 372,500 Total share-based compensation $ 1,485,898 $ 1,364,698 $ 1,487,563 At December 31, 2019, there was approximately $2.1 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 employee restricted stock awards. Stock Options Stock option activity for 2019 and 2018 was as follows: Number of shares Weighted-average exercise price per share Weighted- average remaining contractual term (years) Aggregate intrinsic value Outstanding, December 31, 2017 5,800 $ 13.00 1.9 $ — Options granted — — Options exercised — — Options forfeited or expired — — Outstanding, December 31, 2018 5,800 13.00 0.9 — Options granted — — Options exercised — — Options forfeited or expired (5,800) 13.00 Outstanding, December 31, 2019 — — 0 — Exercisable at December 31, 2019 — $ — 0 $ — The Company did not grant any stock options and there were no options exercised during 2019, 2018 and 2017. Information related to the stock option plans during 2019, 2018 and 2017 was as follows: 2019 2018 2017 Intrinsic value of options exercised $ — $ — $ — Weighted-average fair value of options exercised $ — $ — $ — Restricted Stock Awards Restricted stock activity was as follows: Number of shares Weighted- average grant-date fair value Nonvested, December 31, 2017 767,845 $ 5.61 Shares granted 261,680 6.66 Shares vested (170,759) 4.79 Shares forfeited (25,025) 6.19 Nonvested, December 31, 2018 833,741 6.09 Shares granted 229,669 5.95 Shares vested (225,536) 6.71 Shares forfeited (22,925) 6.20 Nonvested, December 31, 2019 814,949 $ 5.88 |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2019 | |
Retirement Benefits [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 2019, 2018 and 2017, 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, reflected in other long term liabilities in the consolidated balance sheet, was $2.3 million and $1.6 million as of December 31, 2019 and 2018, respectively. The Company had assets consisting of company-owned life insurance contracts generally designated to pay benefits of the deferred compensation plans reflected in other assets in the consolidated balance sheet of $3.1 million and $2.3 million as of December 31, 2019 and 2018, respectively. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
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 April 2023, 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 as a component of general and administrative expense. Rent expense and sublease income as follows for the years ended December 31: 2019 2018 2017 Rent expense $ 1,246,143 $ 1,136,610 $ 1,074,437 Sublease income $ 688,020 $ 662,358 $ 573,494 In March 2016, the FASB issued ASU 2016-02. ASU 2016-02’s core principle is to increase transparency and comparability among organizations by recognizing lease assets and liabilities on the balance sheet and disclosing key information. The Company adopted ASU 2016-02 under the alternative transition method (the effective date approach). It allowed the Company to initially apply the new lease guidance at the adoption date (rather than at the beginning of the earliest period presented). Prior periods have not been adjusted. The primary effect of adopting ASU 2016-02 to the Company was to record right-of-use assets and obligations for the leases currently classified as operating leases. The Company’s significant operating leases include the lease of approximately 25,500 square feet of office space in Nashville, Tennessee for its corporate headquarters. This lease currently expires in October 2022. The operating leases also include the lease of approximately 14,200 square feet of wet laboratory and office space in Nashville, Tennessee by Cumberland Emerging Technologies (“CET”), our majority-owned subsidiary, where it operates the CET Life Sciences Center. This lease currently expires in April 2023. The Company did not have any leases classified as finance leases at January 1, 2019 or December 31, 2019. The new lease accounting standard did not have a significant impact on the Company's Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for any period presented. The Company elected the package of practical expedients offered in the transition guidance which allows management not to reassess lease identification, lease classification and initial direct costs at the adoption date. These operating leases resulted in initial ROU assets of $3.6 million and lease liabilities of $3.8 million as of January 1, 2019 for non-cancelable operating leases with original lease terms in excess of one year. Operating lease liabilities were recorded as the present value of remaining lease payments not yet paid for the lease term discounted using the incremental borrowing rate associated with each lease. Operating lease right-of-use assets represent operating lease liabilities adjusted for lease incentives and initial direct costs. As the Company’s leases do not contain implicit borrowing rates, the incremental borrowing rates were calculated based on information available at January 1, 2019. Incremental borrowing rates reflect the Company’s estimated interest rates for collateralized borrowings over similar lease terms. The weighted-average remaining lease term is 3.4 years and the weighted-average incremental borrowing rate used to discount the present value of the remaining lease payments is 7.42%. Lease Position At December 31, 2019, the Company recorded the following on the Condensed Consolidated Balance Sheet: Right-of-Use Assets Balance Sheet Classification December 31, 2019 Operating lease right-of-use assets Other noncurrent assets $ 2,960,569 Total $ 2,960,569 Lease Liabilities Balance Sheet Classification December 31, 2019 Current: Operating lease liabilities Other current liabilities $ 920,431 Noncurrent: Operating lease liabilities Other noncurrent liabilities 2,076,472 Total $ 2,996,903 Cumulative future minimum sublease income under non-cancelable operating subleases totals approximately $0.7 million and will be paid through the leases ending in October 2022 and April 2023. Future minimum lease payments under non-cancelable operating leases (with initial or remaining lease terms in excess of one year) are as follows: As of December 31, 2019: 2020 $ 1,120,066 2021 1,144,889 2022 1,019,313 2023 92,478 After 2023 — Total future minimum lease payments 3,376,746 Less Interest (379,843) Present value of lease liabilities $ 2,996,903 The Company's future minimum lease commitments, under Topic 840, predecessor to Topic 842, are as follows: As of December 31, 2018: 2019 $ 959,902 2020 980,720 2021 1,001,603 2022 871,969 2023 44,508 After 2023 — Total future minimum lease payments $ 3,858,702 |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2019 | |
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, 2019. All of these securities had a maturity date of less than ninety days and classified as cash and cash equivalents at December 31, 2019. 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, 2019 December 31, 2018 Level 1 Level 2 Total Level 1 Level 2 Total U.S. Treasury notes and bonds $ — $ — $ — $ 5,034,955 $ — $ 5,034,955 SBA loan pools - variable rate — — — — 2,504,551 2,504,551 Short-term cash investments — — — — 751,173 751,173 Commercial Paper — 2,119,607 2,119,607 — — — Total fair value of marketable securities $ — $ 2,119,607 $ 2,119,607 $ 5,034,955 $ 3,255,724 $ 8,290,679 |
Market Concentrations
Market Concentrations | 12 Months Ended |
Dec. 31, 2019 | |
Risks and Uncertainties [Abstract] | |
Market Concentrations | Market Concentrations The Company is focused on the acquisition, development and commercialization of branded prescription products. 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 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 revenues by customer for each customer representing 10% or more of consolidated revenues are summarized below for the years ended December 31: 2019 2018 2017 Customer 1 26% 25% 25% Customer 2 25% 24% 22% Customer 3 16% 26% 25% Customer 4 14% 11% *% *: less than 10% of total The Company’s accounts receivable, net of allowances, due from the customers representing 10% or more of consolidated revenue was 72% and 78% at December 31, 2019 and 2018, respectively. |
Manufacturing and Supply Agreem
Manufacturing and Supply Agreements | 12 Months Ended |
Dec. 31, 2019 | |
Manufacturing and Supply Agreements [Abstract] | |
Manufacturing and Supply Agreements | Manufacturing and Supply AgreementsThe 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, 2019 | |
Employment Agreements [Abstract] | |
Employment Agreements | Employment AgreementsThe 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. |
Discontinued Operations and Dis
Discontinued Operations and Disposal Groups | 12 Months Ended |
Dec. 31, 2019 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | Discontinued Operations In 2016, Cumberland entered into an agreement with Clinigen Group Plc ("Clinigen") for the rights and responsibilities associated with the commercialization of Ethyol in the United States. In 2017, the Company entered into another agreement with Clinigen for the rights and responsibilities associated with the commercialization of Totect in the United States. Ethyol and Totect are collectively referred to herein as the "Products." Early in 2019, Cumberland announced a strategic review the Company's brands, capabilities, and international partners. This review followed an accelerated business development initiative, which resulted in a series of transactions. Because of that progress, Cumberland felt that it was prudent to take a fresh look at our product portfolio, partners, and organization to ensure proper focus and capabilities. In May 2019 following the strategic review, Cumberland entered into an agreement with Clinigen to return the exclusive rights to the Products (the "Agreement"). The Agreement provided for a conclusion of the Company's arrangements with Clinigen effective September 30, 2019. Under the terms of the Agreement, Cumberland will no longer distribute the Products after the transition date and will receive $5 million in financial consideration from Clinigen, paid over a two two In September 2019, Clinigen and Cumberland completed an amendment to the Agreement, whereby the transition date was changed to late December 2019. Under the final terms of the amended Agreement, the Company returned the Product rights to Clinigen on December 31, 2019. Except for the Products' inventory as of December 31, 2019, no other operating assets and no liabilities were transferred to Clinigen. The exit from the Ethyol and Totect Products meets the accounting criteria to be reported as discontinued operations. December 31, 2019, as the transition date, was the final day Cumberland was responsible for the Products. Cumberland was responsible for the Products through December 31, 2019 and beginning on January 1, 2020, the Products' rights transitioned back to Clinigen. As a result, January 1, 2020, was the first day of discontinued operations for the Ethyol and Totect products. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
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 was required to make quarterly payments based on a percentage of Kristalose net sales through November 2018. The payments were treated as consideration for the assets acquired and were capitalized. They are being amortized over the remaining expected useful life of the acquired asset, currently through 2026. In connection with its licensing agreements for Caldolor, the Company is required to pay royalties based on net sales over the life of the product. Royalty expense is recognized as a component of selling and marketing expense in the period that revenue is recognized. In connection with its licensing agreements for Ethyol and Totect, the Company was required to pay royalties based on net sales. The royalty expense was recognized as a component of selling and marketing expense in the period the associated revenue was recognized through the end of the licensing period, December 31, 2019. In connection with the acquisition of Vibativ, the Company is required to pay royalties based on net sales of the product. At the purchase date, Cumberland recorded the fair value of this liability and will continue to evaluate the liability each period and the royalty expense is recognized as a component of selling and marketing expense in the period that the change in fair value is recognized. Legal Matters Cumberland has a number of Patents issued through the United States Patent and Trademark Office (the “USPTO”) including U.S. Patent number 8,148,356 (the “356 Acetadote Patent”) which is assigned to the Company. The claims of the 356 Acetadote Patent encompass the new Acetadote formulation and include 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. Since 2012, Cumberland has to continued to vigorously defend and protect its Acetadote product and related intellectual property rights including the use of all its legal options. |
Quarterly Financial Information
Quarterly Financial Information (Unaudited) | 12 Months Ended |
Dec. 31, 2019 | |
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 2019 and 2018: First Quarter Second Quarter Third Quarter Fourth Quarter Total 2019: Net revenues $ 11,902,747 $ 11,580,600 $ 10,371,918 $ 13,678,372 $ 47,533,637 Operating income (loss) (176,796) (601,715) (1,847,085) (997,409) (3,623,005) Net income (loss) attributable to common shareholders (73,878) (549,507) (1,953,668) (960,706) (3,537,759) Earnings (loss) per share attributable to common shareholders (1) Basic $ — $ (0.04) $ (0.13) $ (0.06) $ (0.23) Diluted $ — $ (0.04) $ (0.13) $ (0.06) $ (0.23) 2018: Net revenues $ 8,587,605 $ 10,163,724 $ 8,492,530 $ 13,497,906 $ 40,741,765 Operating income (loss) (2,452,222) (868,978) (1,806,883) (2,262,689) (7,390,772) Net income (loss) attributable to common shareholders (2,379,239) (720,688) (1,643,044) (2,220,097) (6,963,068) Earnings (loss) per share attributable to common shareholders (1) Basic $ (0.15) $ (0.05) $ (0.11) $ (0.14) $ (0.45) Diluted $ (0.15) $ (0.05) $ (0.11) $ (0.14) $ (0.45) (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. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
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 |
Use of Estimates | Use of EstimatesThe preparation of the consolidated financial statements in conformity with U.S. generally accepted accounting principles requires 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 ReportingThe 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, contingent consideration liability 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. |
Cash and Cash Equivalents | Cash and Cash EquivalentsCash and cash equivalents include highly liquid investments with original maturities of three months or less. As of December 31, 2019 and 2018, cash equivalents consist primarily of money market funds as well as trading securities with original maturities of less than ninety days. |
Marketable Securities | Marketable Securities The Company invests in marketable debt securities in order to maximize its return on cash. Marketable securities consist of short-term cash investments, U.S. Treasury notes and bonds, corporate bonds, and commercial paper. 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, 2019 and 2018, 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. As of December 31, 2019, all the trading securities were commercial paper with original maturities of less than ninety days and as a result, were classified as cash equivalents. |
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 collection status. The majority of the Company’s products are distributed through independent pharmaceutical wholesalers. The allowances against accounts receivable for chargebacks and discounts 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 and expired product. The allowances in accounts receivable for chargebacks, cash discounts and damaged goods were $0.8 million at December 31, 2019 and $0.9 million at December 31, 2018. 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 conjunction with recognizing a sale to a wholesaler, revenues are reduced and accrued liabilities are increased by the Company’s estimate of the rebate that may be claimed as well as the reserves for expired and damaged goods. Cash discounts are reductions to invoiced amounts offered to customers for payment within a specified period of time from the date of the invoice. |
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. As discussed below, effective January 1, 2017, inventories are stated at the lower of cost or net realizable value with cost determined using the first-in, first-out method. |
Prepaid and Other Current Assets | Prepaid and Other Current Assets Prepaid and other current assets consist of deferred offering costs, prepaid insurance premiums, prepaid consulting services, deposits and annual fees paid to the U.S. Food and Drug Administration ("FDA"). The Company expenses all prepaid and other current asset 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 (loss) 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 and Goodwill The Company’s intangible assets and goodwill consist of capitalized costs related to product and license rights, patents, trademarks and goodwill obtained in the Vibativ acquisition. Goodwill is not amortized for financial reporting purposes, but is subject to impairment analysis at least annually. 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 several factors. This includes the term of the license agreement, the patent life or market exclusivity of the product and as well as management's expectations of continued involvement with the product and the assessment of future sales, the future periods under which the product will be sold and the 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: |
Impairment of Long-Lived Assets | Impairment of Long-Lived AssetsLong-lived assets, such as property and equipment, operating lease right-of-use assets 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 Effective January 1, 2018, the Company adopted the Financial Accounting Standards Board’s (“FASB”) amended guidance in the form of Accounting Standards Update (“ASU”) No. 2014-09, "Revenue from Contracts with Customers," (ASC 606). Results for reporting periods beginning after January 1, 2018 are presented under ASC 606, while prior period amounts were not adjusted and are reported in accordance with ASC 605. Net Product Revenue Revenues from product sales are recognized in the amount that reflects the consideration that we expect to receive for these goods. Depending upon the shipping terms of the transaction, the revenue is recognized.at the point where the customer obtains control of the goods and we satisfy our performance obligation. This occurs upon either shipment of the product or arrival at its ship to destination. Payment terms typically range from 30 to 60 days from date of shipment. 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, coupons, product returns, and certain administrative and service fees. Significant judgments must be made in determining the transaction price for our sales of products related to these adjustments. Sales Rebates and Discounts The allowances against accounts receivable for chargebacks, discounts, expired 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 and expired 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 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. Sales Returns 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, expiration date by product as well as any other factor expected to impact future returns. Any changes in the assumptions used to estimate the provision for returns are recognized in the period those assumptions are changed. 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. 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 as well as any adjustment in the net realizable value of inventory acquired in acquisitions. Cost of products sold also includes expenses associated with the reduction in the net realizable value 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 |
Advertising Costs | Advertising CostsAdvertising costs are expensed as incurred 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. Research and 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 over the period of time the clinical trials are performed. |
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 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 (loss) per share is calculated by dividing net income (loss) 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 (loss) per share is calculated by assuming the vesting of unvested restricted stock and the exercise of stock options and warrants and unrecognized compensation costs. |
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 preclinical 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. Reclassification of prior period amounts |
Recent Accounting Guidance | Recent Accounting Guidance Recent Adopted Accounting Pronouncements In May 2014, the FASB issued amended guidance in the form of ASU No. 2014-09, “Revenue from Contracts with Customers” (“ASC 606”). 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 replaced most of the existing revenue recognition standards in U.S. GAAP when it became effective. In July 2015, the FASB issued a one-year deferral of the adoption date, which extended the effective date for us to January 1, 2018, at which point Cumberland adopted the standard. The Company evaluated its revenues and the new guidance had immaterial impacts to recognition practices upon adoption on January 1, 2018. As part of the adoption, the Company elected to apply the new guidance on a modified retrospective basis. The Company did not record a cumulative effect adjustment to historical retained earnings for initially applying the new guidance as no revenue recognition differences were identified in the timing or amount of revenue. In February 2016, the Financial Accounting Standards Board ("FASB") issued guidance in the form of a FASB Accounting Standards Update ("ASU") No. 2016-02, “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 twelve months. Leases will be classified as either finance (formerly "capital leases") or operating, with classification affecting the pattern of expense recognition in the income statement. The standard provides for a modified retrospective transition approach 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. In July 2018, the FASB issued ASU 2018-11, "Leases: Targeted Improvements", allowing for an alternative transition method (the effective date approach). It allows an entity to initially apply the new lease guidance at the adoption date (rather than at the beginning of the earliest period presented). Cumberland adopted the lease guidance effective January 1, 2019 using the package of transition practical expedients. This allowed the Company to retain the lease classification for any leases existing prior to adoption, in addition to other benefits. See additional discussion of the impact of adopting the lease accounting guidance in Note 15. Recent Accounting Pronouncements - Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments-Credit Losses,” which changes the impairment model for most financial assets and certain other instruments. For trade and other receivables, held-to-maturity debt securities, loans and other instruments, companies will be required to use a new forward-looking “expected loss” model that generally will result in the earlier recognition of allowances for losses. For available-for-sale debt securities with unrealized losses, companies will measure credit losses in a manner similar to what they do today, except that the losses will be recognized as allowances rather than as reductions in the amortized cost of the securities. Companies will have to disclose more information, including the information they use to track credit quality by year of origination for most financing receivables. Companies will apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. This standard is effective for the Company on January 1, 2020. The Company continues to evaluate this new standard on its trade and other receivables but does not expect a material impact on its consolidated financial statements. In May 2019, the FASB issued ASU 2019-05, "Financial Instruments-Credit Losses (Topic 326): Targeted Transition Relief" which provides transition relief for ASU 2016-13 by providing entities with an alternative to irrevocably elect the fair value option for eligible financial assets measured at amortized cost upon adoption of the new credit losses standard. Certain eligibility requirements must be met, the election must be applied on an instrument-by-instrument basis, and the election is not available for either available-for-sale or held-to-maturity debt securities. The effective date is the same as ASU 2016-13, January 1, 2020. The Company continues to evaluate this new standard but does not expect a material impact on its consolidated financial statements. In November 2018, the FASB issued ASU No. 2018-18, “Collaboration Arrangements: Clarifying the Interaction between Topic 808 and Topic 606” (ASU 2018-18). The issuance of ASU 2014-09 raised questions about the interaction between the guidance on collaborative arrangements and revenue recognition. ASU 2018-18 addresses this uncertainty by (1) clarifying that certain transactions between collaborative arrangement participants should be accounted for as revenue under ASU 2014-09 when the collaboration arrangement participant is a customer, (2) adding unit of account guidance to assess whether the collaboration arrangement or a part of the arrangement is with a customer and (3) precluding a company from presenting transactions with collaboration arrangement participants that are not directly related to sales to third parties together with revenue from contracts with customers. The new standard will be effective for the Company on January 1, 2020. The Company continues to evaluate this new standard but does not expect a material impact on its consolidated financial statements. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
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 |
Omeclamox_-Pak, RediTrex_ and_2
Omeclamox®-Pak, RediTrex® and Vibativ® (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Schedule of Business Acquisitions, by Acquisition | The following table summarizes the initial payments and consideration for the business combination: Consideration: Cash paid at closing $ 20,000,000 Cash payment during early 2019 5,000,000 Fair value of contingent consideration - net sales royalty 9,182,000 Total consideration $ 34,182,000 |
Schedule of Business Acquisitions by Acquisition, Contingent Consideration | The following table presents the changes in the Company's Level 3 contingent consideration liability that is measured at fair value on a recurring basis. The current and long-term portions of this liability are disclosed in Note 8. The contingent consideration earned and accrued in operating expenses is paid to the seller quarterly. Contingent consideration liability Balance at November 12, 2018 $ 9,034,000 Change in fair value of contingent consideration included in operating expenses (40,000) Contingent consideration earned and accrued in operating expenses 508,000 Balance at December 31, 2018 9,502,000 Adjustment to initial fair value of the contingent consideration liability 148,000 Cash payment of royalty during the period (1,033,108) Change in fair value of contingent consideration included in operating expenses (804,167) Contingent consideration earned and accrued in operating expenses 820,864 Balance at December 31, 2019 $ 8,633,589 |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the allocation of the fair values of the assets acquired as of the acquisition date for Vibativ: Finished goods inventory $ 6,624,000 Work in process - unlabeled vials 3,970,000 Work in process - validation vials 1,827,000 Raw materials 9,129,000 Total inventory $ 21,550,000 Intellectual property amortizable intangible assets $ 11,750,000 Goodwill 882,000 Total intangibles and goodwill $ 12,632,000 Total assets acquired $ 34,182,000 |
Revenues (Tables)
Revenues (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
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: 2019 2018 2017 Products: Acetadote $ 3,824,449 $ 4,284,111 $ 6,576,720 Omeclamox-Pak 837,829 623,297 1,761,868 Kristalose 12,895,120 12,055,625 11,455,805 Vaprisol 936,615 1,763,874 1,576,222 Caldolor 5,222,281 5,001,997 4,178,443 Ethyol 12,774,831 10,545,906 10,835,038 Totect 369,912 850,965 3,992,467 Vibativ 8,691,550 5,075,057 — Total net product revenues $ 45,552,587 $ 40,200,832 $ 40,376,563 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of inventories, current | The Company's net inventories consisted of the following as of December 31: 2019 2018 Raw materials and work in process $ 19,345,723 $ 18,378,450 Consigned inventory 416,468 937,006 Finished goods, net of reserve 5,204,321 8,511,887 Total inventories 24,966,513 27,827,343 less non-current inventories (15,554,992) (15,749,000) Total inventories classified as current $ 9,411,521 $ 12,078,343 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | Property and equipment consisted of the following at December 31: Range of useful lives 2019 2018 Computer equipment 3 – 5 years $ 1,260,630 $ 1,148,140 Office equipment 3 – 15 years 878,350 809,153 Furniture and fixtures 5 – 15 years 646,505 639,267 Leasehold improvements 3 – 15 years, or remaining lease term 1,356,640 1,299,363 Total property and equipment, gross 4,142,125 3,895,923 Less: accumulated depreciation and amortization (3,394,329) (3,124,710) Total property and equipment, net $ 747,796 $ 771,213 |
Schedule of depreciation expense | Depreciation expense was as follows for the years ended December 31: 2019 2018 2017 Depreciation expense $ 269,619 $ 213,237 $ 211,532 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets | Intangible assets and Goodwill consisted of the following at December 31: 2019 2018 Product and license rights $ 37,400,742 $ 36,573,941 Less: accumulated amortization (11,499,141) (8,405,188) Total product and license rights 25,901,601 28,168,753 Patents 9,882,511 9,428,266 Less: accumulated amortization (5,127,878) (4,087,273) Total patents 4,754,633 5,340,993 Trademarks 273,110 154,373 Less: accumulated amortization (9,020) (9,020) Total trademarks 264,090 145,353 Total intangible assets $ 30,920,324 $ 33,655,099 Goodwill $ 882,000 $ 784,000 |
Schedule of expected amortization expense of intangible assets | Amortization expense related to product and license rights, trademarks and patents were as follows for the years ended December 31: 2019 2018 2017 Amortization expense $ 4,134,557 $ 2,769,466 $ 2,436,222 The expected amortization expense for the Company's current balance of intangible assets are as follows: Year ending December 31: 2020 $ 4,286,336 2021 4,084,702 2022 3,530,879 2023 3,743,526 2024 and thereafter 15,274,881 $ 30,920,324 |
Other Current and Other Long-_2
Other Current and Other Long-term Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Other Liabilities, Current [Abstract] | |
Schedule of accrued liabilities | Other current liabilities consisted of the following at December 31: Other current liabilities 2019 2018 Rebates, product returns, administrative fees and service fees $ 4,825,657 $ 5,635,972 Employee wages and benefits 1,295,905 1,263,426 Stock payable — 1,085,400 Current portion of accrued contingent consideration 2,374,776 2,290,000 Deferred acquisition liability — 5,000,000 Accrued inventory purchases 829,047 434,405 Accrued payment for asset purchase 1,000,000 — Other 991,973 1,001,724 Total other current liabilities $ 11,317,358 $ 16,710,927 |
Schedule of other long-term liabilities | Other long-term liabilities 2019 2018 Noncurrent portion of accrued contingent consideration $ 6,258,813 $ 7,212,000 Deferred compensation 2,278,164 1,588,123 Other 200,346 519,020 Total other long-term liabilities $ 8,737,323 $ 9,319,143 |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
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: 2019 2018 2017 Numerator: Net income (loss) attributable to common shareholders $ (3,537,759) $ (6,963,068) $ (7,978,633) Denominator: Weighted-average shares outstanding – basic 15,396,098 15,614,052 15,911,577 Dilutive effect of restricted stock and stock options — — — Weighted-average shares outstanding – diluted 15,396,098 15,614,052 15,911,577 |
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: 2019 2018 2017 Anti-dilutive shares and options 4,000 41,650 18,325 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
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: 2019 2018 Deferred Tax Assets Net operating loss and tax credits $ 16,964,685 $ 16,410,403 Property and equipment and intangibles 227,072 236,318 Allowance for accounts receivable 257,564 251,068 Reserve for expired product 469,466 558,484 Inventory 35,227 193,150 Deferred charges 845,765 910,577 Cumulative compensation costs incurred on deductible equity awards 1,047,149 884,049 Total deferred tax assets 19,846,928 19,444,049 Deferred Tax Liabilities Intangible assets (1,313,965) (1,974,787) Net deferred tax assets, before valuation allowance 18,532,963 17,469,262 Less: deferred tax asset valuation allowance (18,511,161) (17,382,052) Net deferred tax assets $ 21,802 $ 87,210 |
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, 2019: Years of expiration Federal State 2020 $ — $ 13,115 2021 - 2029 — 49,392,824 2030 44,153,819 461,280 2031 - 2039 7,534,351 9,947,070 Indefinite Period 5,493,258 383,869 Total federal and state net operating loss carryforwards $ 57,181,428 $ 60,198,158 |
Schedule of the components of income tax benefit (expense) | Income tax (expense) benefit includes the following components for the years ended December 31: 2019 2018 2017 Current: Federal $ 65,408 $ — $ — State and other 79,316 (16,636) (59,243) Total current income tax (expense) benefit 144,724 (16,636) (59,243) Deferred: Federal (65,408) — (3,682,772) State — — (432,874) Total deferred income tax (expense) benefit (65,408) — (4,115,646) Total income tax (expense) benefit $ 79,316 $ (16,636) $ (4,174,889) |
Schedule of effective tax rate reconciliation | The Company’s effective income tax rate for 2019, 2018 and 2017 reconciles with the federal statutory tax rate as follows: 2019 2018 2017 Federal tax expense at statutory rate 21 % 21 % 34 % State income tax expense (net of federal income tax benefit) 4 % 4 % 4 % Permanent differences associated with general business credits 7 % 1 % 1 % Change in valuation allowance (31) % (25) % (148) % Change in tax rate — % — % 2 % Other permanent differences 1 % (1) % 1 % Other — % — % (2) % Net income tax expense 2 % — % (108) % |
Stock-Based Compensation Plans
Stock-Based Compensation Plans (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of share-based compensation expense | Stock compensation expense consisted of the following for the years ended December 31: 2019 2018 2017 Share-based compensation - employees $ 1,481,016 $ 1,244,606 $ 1,032,094 Share-based compensation - nonemployees 4,882 120,092 82,969 Share-based compensation - foundation contribution — $ — 372,500 Total share-based compensation $ 1,485,898 $ 1,364,698 $ 1,487,563 |
Schedule of stock options activity | Stock option activity for 2019 and 2018 was as follows: Number of shares Weighted-average exercise price per share Weighted- average remaining contractual term (years) Aggregate intrinsic value Outstanding, December 31, 2017 5,800 $ 13.00 1.9 $ — Options granted — — Options exercised — — Options forfeited or expired — — Outstanding, December 31, 2018 5,800 13.00 0.9 — Options granted — — Options exercised — — Options forfeited or expired (5,800) 13.00 Outstanding, December 31, 2019 — — 0 — Exercisable at December 31, 2019 — $ — 0 $ — |
Schedule of stock options activity, additional disclosures | Information related to the stock option plans during 2019, 2018 and 2017 was as follows: 2019 2018 2017 Intrinsic value of options exercised $ — $ — $ — Weighted-average fair value of options exercised $ — $ — $ — |
Schedule of restricted stock activity | Restricted stock activity was as follows: Number of shares Weighted- average grant-date fair value Nonvested, December 31, 2017 767,845 $ 5.61 Shares granted 261,680 6.66 Shares vested (170,759) 4.79 Shares forfeited (25,025) 6.19 Nonvested, December 31, 2018 833,741 6.09 Shares granted 229,669 5.95 Shares vested (225,536) 6.71 Shares forfeited (22,925) 6.20 Nonvested, December 31, 2019 814,949 $ 5.88 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Schedule of rent expense and sublease income | Rent expense and sublease income as follows for the years ended December 31: 2019 2018 2017 Rent expense $ 1,246,143 $ 1,136,610 $ 1,074,437 Sublease income $ 688,020 $ 662,358 $ 573,494 |
Schedule of balance sheet classification | At December 31, 2019, the Company recorded the following on the Condensed Consolidated Balance Sheet: Right-of-Use Assets Balance Sheet Classification December 31, 2019 Operating lease right-of-use assets Other noncurrent assets $ 2,960,569 Total $ 2,960,569 Lease Liabilities Balance Sheet Classification December 31, 2019 Current: Operating lease liabilities Other current liabilities $ 920,431 Noncurrent: Operating lease liabilities Other noncurrent liabilities 2,076,472 Total $ 2,996,903 |
Schedule of operating lease liability maturities | Future minimum lease payments under non-cancelable operating leases (with initial or remaining lease terms in excess of one year) are as follows: As of December 31, 2019: 2020 $ 1,120,066 2021 1,144,889 2022 1,019,313 2023 92,478 After 2023 — Total future minimum lease payments 3,376,746 Less Interest (379,843) Present value of lease liabilities $ 2,996,903 |
Schedule of future minimum lease payments for operating leases | The Company's future minimum lease commitments, under Topic 840, predecessor to Topic 842, are as follows: As of December 31, 2018: 2019 $ 959,902 2020 980,720 2021 1,001,603 2022 871,969 2023 44,508 After 2023 — Total future minimum lease payments $ 3,858,702 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
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, 2019 December 31, 2018 Level 1 Level 2 Total Level 1 Level 2 Total U.S. Treasury notes and bonds $ — $ — $ — $ 5,034,955 $ — $ 5,034,955 SBA loan pools - variable rate — — — — 2,504,551 2,504,551 Short-term cash investments — — — — 751,173 751,173 Commercial Paper — 2,119,607 2,119,607 — — — Total fair value of marketable securities $ — $ 2,119,607 $ 2,119,607 $ 5,034,955 $ 3,255,724 $ 8,290,679 |
Market Concentrations (Tables)
Market Concentrations (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Risks and Uncertainties [Abstract] | |
Schedule of revenues concentration from major customers | Total revenues by customer for each customer representing 10% or more of consolidated revenues are summarized below for the years ended December 31: 2019 2018 2017 Customer 1 26% 25% 25% Customer 2 25% 24% 22% Customer 3 16% 26% 25% Customer 4 14% 11% *% *: less than 10% of total |
Quarterly Financial Informati_2
Quarterly Financial Information (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of quarterly financial information | The following table sets forth the unaudited operating results for each fiscal quarter of 2019 and 2018: First Quarter Second Quarter Third Quarter Fourth Quarter Total 2019: Net revenues $ 11,902,747 $ 11,580,600 $ 10,371,918 $ 13,678,372 $ 47,533,637 Operating income (loss) (176,796) (601,715) (1,847,085) (997,409) (3,623,005) Net income (loss) attributable to common shareholders (73,878) (549,507) (1,953,668) (960,706) (3,537,759) Earnings (loss) per share attributable to common shareholders (1) Basic $ — $ (0.04) $ (0.13) $ (0.06) $ (0.23) Diluted $ — $ (0.04) $ (0.13) $ (0.06) $ (0.23) 2018: Net revenues $ 8,587,605 $ 10,163,724 $ 8,492,530 $ 13,497,906 $ 40,741,765 Operating income (loss) (2,452,222) (868,978) (1,806,883) (2,262,689) (7,390,772) Net income (loss) attributable to common shareholders (2,379,239) (720,688) (1,643,044) (2,220,097) (6,963,068) Earnings (loss) per share attributable to common shareholders (1) Basic $ (0.15) $ (0.05) $ (0.11) $ (0.14) $ (0.45) Diluted $ (0.15) $ (0.05) $ (0.11) $ (0.14) $ (0.45) (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 ($) | 1 Months Ended | 12 Months Ended | ||
Apr. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Noncontrolling Interest [Abstract] | ||||
Exercise of options and related tax benefit | $ 1,000,000 | |||
Net loss at subsidiary allocated to noncontrolling interests | $ 8,752 | $ 75,704 | $ 71,182 | |
Cumberland Emerging Technologies, Inc (CET) | ||||
Noncontrolling Interest [Abstract] | ||||
Noncontrolling interest, ownership percentage by parent | 85.00% | |||
HongKong WinHealth Pharma Group Co. Limited | ||||
Noncontrolling Interest [Abstract] | ||||
Investment in CET | 1,000,000 | |||
Contribution of cash | 300,000 | |||
Conversion of intercompany loans payable | 700,000 | |||
Gloria Pharmaceuticals | ||||
Noncontrolling Interest [Abstract] | ||||
Exchange for consideration, amount | $ 800,000 | |||
Cumberland Emerging Technologies, Inc (CET) | Harbin Gloria Pharmaceuticals Co | ||||
Noncontrolling Interest [Abstract] | ||||
Exercise of options and related tax benefit | $ 1,000,000 |
Significant Accounting Polici_4
Significant Accounting Policies (Narrative) (Details) | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2019USD ($)segment | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Jan. 01, 2019USD ($) | |
Segment Reporting [Abstract] | ||||||||||||
Number of operating segments | segment | 1 | |||||||||||
Net revenues from customers outside the United States | $ 13,678,372 | $ 10,371,918 | $ 11,580,600 | $ 11,902,747 | $ 13,497,906 | $ 8,492,530 | $ 10,163,724 | $ 8,587,605 | $ 47,533,637 | $ 40,741,765 | $ 41,150,131 | |
Operating lease right-of-use assets | 2,960,569 | 2,960,569 | $ 3,600,000 | |||||||||
Present value of lease liabilities | 2,996,903 | 2,996,903 | $ 3,800,000 | |||||||||
Distribution costs | 794,317 | 618,756 | 621,142 | |||||||||
Advertising costs | 2,690,280 | 2,219,074 | 2,589,185 | |||||||||
Product Sales Related Allowances - Chargebacks, Cash Discounts and Damaged Goods | ||||||||||||
Segment Reporting [Abstract] | ||||||||||||
Accounts receivable, allowances, current | $ 800,000 | $ 900,000 | 800,000 | 900,000 | ||||||||
Non-US | ||||||||||||
Segment Reporting [Abstract] | ||||||||||||
Net revenues from customers outside the United States | $ 1,500,000 | $ 2,100,000 | $ 1,600,000 |
Significant Accounting Polici_5
Significant Accounting Policies (Schedule of Intangible Assets, Useful Lives) (Details) | 12 Months Ended |
Dec. 31, 2019 | |
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 |
Omeclamox_-Pak, RediTrex_ and_3
Omeclamox®-Pak, RediTrex® and Vibativ® - Narrative (Details) - USD ($) shares in Thousands | Oct. 29, 2013 | Nov. 30, 2016 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2020 |
Business Acquisition [Line Items] | ||||||
Payments for asset acquisitions | $ 2,300,000 | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | 45,552,587 | $ 40,200,832 | $ 40,376,563 | |||
Other revenue, potential upfront payment related to product sales | 4,800,000 | |||||
Payments to acquire businesses | 5,000,000 | 20,000,000 | 0 | |||
Amended International Agreement | Pernix Therapeutics | ||||||
Business Acquisition [Line Items] | ||||||
Other revenue, potential upfront payment related to product sales | $ 4,000,000 | 2,300,000 | ||||
Omeclamox-Pak | ||||||
Business Acquisition [Line Items] | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 800,000 | 600,000 | ||||
Methotrexate | ||||||
Business Acquisition [Line Items] | ||||||
Payments to acquire businesses | $ 100,000 | |||||
Liabilities incurred | $ 900,000 | |||||
Stock issued during period, acquisitions | 900,000 | 1,100,000 | ||||
Methotrexate | Subsequent Event | ||||||
Business Acquisition [Line Items] | ||||||
Liability to be paid | $ 1,000,000 | |||||
Omeclamox-Pak | ||||||
Business Acquisition [Line Items] | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 837,829 | 623,297 | 1,761,868 | |||
Ethyol | ||||||
Business Acquisition [Line Items] | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 12,774,831 | $ 10,545,906 | $ 10,835,038 | |||
Restricted Stock | Methotrexate | ||||||
Business Acquisition [Line Items] | ||||||
Stock issued during period, acquisitions (in shares) | 180 |
Omeclamox_-Pak, RediTrex_ and_4
Omeclamox®-Pak, RediTrex® and Vibativ® - Vibativ Acquisition - Narrative (Details) - USD ($) | Mar. 08, 2019 | Nov. 30, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Business Acquisition [Line Items] | |||||
Payments to acquire businesses | $ 5,000,000 | $ 20,000,000 | $ 0 | ||
Current portion of accrued contingent consideration | 2,374,776 | 2,290,000 | |||
Noncurrent portion of accrued contingent consideration | 6,258,813 | $ 7,212,000 | |||
VIBATIV | |||||
Business Acquisition [Line Items] | |||||
Payments to acquire businesses | $ 20,000,000 | 20,000,000 | |||
Additional payments to acquire businesses | $ 5,000,000 | $ 5,000,000 | |||
Tiered royalty payments (percentage) | 20.00% |
Omeclamox_-Pak, RediTrex_ and_5
Omeclamox®-Pak, RediTrex® and Vibativ® - Vibativ Acquisition - Schedule of Contingent Consideration and Preliminary Allocation (Details) - USD ($) | Mar. 08, 2019 | Nov. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Business Acquisition [Line Items] | |||||||
Cash paid at closing | $ 5,000,000 | $ 20,000,000 | $ 0 | ||||
Goodwill | $ 784,000 | $ 784,000 | 882,000 | 784,000 | |||
VIBATIV | |||||||
Business Acquisition [Line Items] | |||||||
Cash paid at closing | $ 20,000,000 | 20,000,000 | |||||
Cash payment during early 2019 | $ 5,000,000 | 5,000,000 | |||||
Fair value of contingent consideration - net sales royalty | 9,182,000 | ||||||
Total consideration | 34,182,000 | ||||||
Balance at November 12, 2018 | 9,034,000 | 9,502,000 | |||||
Change in fair value of contingent consideration included in operating expenses | (40,000) | (804,167) | |||||
Contingent consideration earned and accrued in operating expenses | 508,000 | 820,864 | |||||
Adjustment to initial fair value of the contingent consideration liability | 148,000 | ||||||
Cash payment of royalty during the period | 1,033,108 | ||||||
Balance at December 31, 2018 | $ 9,502,000 | $ 9,502,000 | $ 8,633,589 | $ 9,502,000 | |||
Finished goods inventory | 6,624,000 | ||||||
Work in process - unlabeled vials | 3,970,000 | ||||||
Work in process - validation vials | 1,827,000 | ||||||
Raw materials | 9,129,000 | ||||||
Total inventory | 21,550,000 | ||||||
Intellectual property amortizable intangible assets | 11,750,000 | ||||||
Goodwill | 882,000 | ||||||
Total intangibles and goodwill | 12,632,000 | ||||||
Total assets acquired | $ 34,182,000 |
Revenues (Schedule of Net Produ
Revenues (Schedule of Net Product Revenues by Product) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue from External Customer [Line Items] | |||
Revenues | $ 45,552,587 | $ 40,200,832 | $ 40,376,563 |
Acetadote | |||
Revenue from External Customer [Line Items] | |||
Revenues | 3,824,449 | 4,284,111 | 6,576,720 |
Omeclamox-Pak | |||
Revenue from External Customer [Line Items] | |||
Revenues | 837,829 | 623,297 | 1,761,868 |
Kristalose | |||
Revenue from External Customer [Line Items] | |||
Revenues | 12,895,120 | 12,055,625 | 11,455,805 |
Vaprisol | |||
Revenue from External Customer [Line Items] | |||
Revenues | 936,615 | 1,763,874 | 1,576,222 |
Caldolor | |||
Revenue from External Customer [Line Items] | |||
Revenues | 5,222,281 | 5,001,997 | 4,178,443 |
Ethyol | |||
Revenue from External Customer [Line Items] | |||
Revenues | 12,774,831 | 10,545,906 | 10,835,038 |
Totect | |||
Revenue from External Customer [Line Items] | |||
Revenues | 369,912 | 850,965 | 3,992,467 |
Vibativ | |||
Revenue from External Customer [Line Items] | |||
Revenues | $ 8,691,550 | $ 5,075,057 | $ 0 |
Revenues (Narrative) (Details)
Revenues (Narrative) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Product Revenues | |||
Revenues | $ 45,552,587 | $ 40,200,832 | $ 40,376,563 |
Other Revenues | |||
Other revenue, upfront payment | 1,000,000 | ||
Other revenue, potential upfront payments related to regulatory approval | 2,200,000 | ||
Other revenue, potential upfront payment related to product sales | 4,800,000 | ||
Cumulative upfront payment | 1,200,000 | ||
Milestone payments associated with international agreements | 100,000 | ||
Collaborative Arrangement, Federal Small Business Grant Programs | Grant | |||
Product Revenues | |||
Revenues | 1,300,000 | $ 100,000 | $ 200,000 |
HongKong WinHealth Pharma Group Co. Limited And DB Pharm Korea Co., Ltd. | |||
Product Revenues | |||
Revenues | $ 300,000 |
Inventories (Schedule of Invent
Inventories (Schedule of Inventories) (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Raw materials and work in process | $ 19,345,723 | $ 18,378,450 |
Consigned inventory | 416,468 | 937,006 |
Finished goods, net of reserve | 5,204,321 | 8,511,887 |
Total inventories | 24,966,513 | 27,827,343 |
less non-current inventories | (15,554,992) | (15,749,000) |
Total inventories | $ 9,411,521 | $ 12,078,343 |
Inventories (Narrative) (Detail
Inventories (Narrative) (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Inventory [Line Items] | ||
Inventory reserves, obsolescence and discontinuance | $ 100,000 | $ 300,000 |
Non-current inventories | 15,554,992 | 15,749,000 |
Finished goods | 5,204,321 | 8,511,887 |
VIBATIV | ||
Inventory [Line Items] | ||
Non-current inventories | 15,300,000 | |
Finished goods | $ 800,000 | |
Ifetroban Clinical | ||
Inventory [Line Items] | ||
Non-current inventories | $ 300,000 |
Property and Equipment (Schedul
Property and Equipment (Schedule of Property and Equipment) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 4,142,125 | $ 3,895,923 |
Less: accumulated depreciation and amortization | (3,394,329) | (3,124,710) |
Total property and equipment, net | 747,796 | 771,213 |
Computer Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 1,260,630 | $ 1,148,140 |
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 | 878,350 | $ 809,153 |
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 | 646,505 | $ 639,267 |
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 | $ 1,356,640 | $ 1,299,363 |
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 (Depreci
Property and Equipment (Depreciation Expense) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation, including amortization related to leasehold improvements | $ 269,619 | $ 213,237 | $ 211,532 |
Intangible Assets (Schedule of
Intangible Assets (Schedule of Intangible Assets) (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, net | $ 30,920,324 | $ 33,655,099 |
Product and License Rights | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | 37,400,742 | 36,573,941 |
Accumulated amortization | (11,499,141) | (8,405,188) |
Intangible assets, net | 25,901,601 | 28,168,753 |
Patents | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | 9,882,511 | 9,428,266 |
Accumulated amortization | (5,127,878) | (4,087,273) |
Intangible assets, net | 4,754,633 | 5,340,993 |
Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | 273,110 | 154,373 |
Accumulated amortization | (9,020) | (9,020) |
Intangible assets, net | $ 264,090 | $ 145,353 |
Intangible Assets (Narrative) (
Intangible Assets (Narrative) (Details) - USD ($) shares in Thousands | 1 Months Ended | 12 Months Ended | ||||
Nov. 30, 2018 | Nov. 30, 2016 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Feb. 28, 2014 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Goodwill | $ 882,000 | $ 784,000 | ||||
Other revenue, potential upfront payment related to product sales | 4,800,000 | |||||
Payments to acquire businesses | 5,000,000 | 20,000,000 | $ 0 | |||
Additions to intangible assets | 772,944 | 3,819,486 | 1,213,110 | |||
Amortization of intangible assets | 4,134,557 | 2,769,466 | $ 2,436,222 | |||
Product and License Rights | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Intangible assets, gross | 37,400,742 | 36,573,941 | ||||
Patents | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Intangible assets, gross | 9,882,511 | 9,428,266 | ||||
Additions to intangible assets | 700,000 | 400,000 | ||||
Methotrexate | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Payments to acquire businesses | $ 100,000 | |||||
Stock issued during period, acquisitions | 900,000 | $ 1,100,000 | ||||
Methotrexate | Nordic | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Stock issued during period, acquisitions | 1,000,000 | |||||
Methotrexate | Restricted Stock | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Stock issued during period, acquisitions (in shares) | 180 | |||||
VIBATIV | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Goodwill | $ 882,000 | |||||
Payments to acquire businesses | 20,000,000 | 20,000,000 | ||||
Intellectual property amortizable intangible assets | $ 11,750,000 | |||||
Increase in goodwill | $ 100,000 | |||||
Vaprisol | Product and License Rights | ||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||
Intangible assets, gross | $ 3,000,000 |
Intangible Assets Future Amorti
Intangible Assets Future Amortization Expense (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2020 | $ 4,286,336 | |
2021 | 4,084,702 | |
2022 | 3,530,879 | |
2023 | 3,743,526 | |
2024 and thereafter | 15,274,881 | |
Intangible assets, net | $ 30,920,324 | $ 33,655,099 |
Other Current and Other Long-_3
Other Current and Other Long-term Liabilities (Schedule of Other Current and Noncurrent Liabilities) (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Other Liabilities, Current [Abstract] | ||
Rebates, product returns, administrative fees and service fees | $ 4,825,657 | $ 5,635,972 |
Employee wages and benefits | 1,295,905 | 1,263,426 |
Stock payable | 0 | 1,085,400 |
Current portion of accrued contingent consideration | 2,374,776 | 2,290,000 |
Deferred acquisition liability | 0 | 5,000,000 |
Accrued inventory purchases | 829,047 | 434,405 |
Accrued payment for asset purchase | 1,000,000 | 0 |
Other | 991,973 | 1,001,724 |
Total other current liabilities | 11,317,358 | 16,710,927 |
Noncurrent portion of accrued contingent consideration | 6,258,813 | 7,212,000 |
Deferred compensation | 2,278,164 | 1,588,123 |
Other | 200,346 | 519,020 |
Other Liabilities, Noncurrent, Total | $ 8,737,323 | $ 9,319,143 |
Debt (Line of Credit) (Details)
Debt (Line of Credit) (Details) - USD ($) | Jul. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Oct. 17, 2018 |
Line of Credit Facility [Line Items] | ||||
Revolving line of credit | $ 18,500,000 | $ 20,000,000 | ||
Revolving Credit Facility | Pinnacle Bank | Second Amendment | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit, maximum borrowing capacity | $ 20,000,000 | |||
Revolving line of credit | 18,500,000 | |||
Revolving Credit Facility | Pinnacle Bank | Line of Credit | ||||
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 | |||
Revolving line of credit | $ 20,000,000 | |||
Interest rate | 4.50% | |||
Line of credit, unused capacity, commitment fee percentage | 0.25% | |||
Revolving Credit Facility | Pinnacle Bank | Line of Credit | Minimum | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate | 1.75% | |||
Revolving Credit Facility | Pinnacle Bank | Line of Credit | Maximum | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate | 2.75% |
Shareholders' Equity (Initial P
Shareholders' Equity (Initial Public Offering, Preferred Stock and Common Stock, Narrative) (Details) | Aug. 10, 2009USD ($)$ / sharesshares | Jan. 31, 2018USD ($) | Dec. 31, 2019USD ($)shares | Dec. 31, 2018USD ($)shares | Dec. 31, 2017USD ($)shares | Dec. 31, 2016shares |
Initial Public Offering [Abstract] | ||||||
Initial public offering, issuance costs | $ 0 | $ 383,310 | $ 27,950 | |||
Preferred Stock [Abstract] | ||||||
Preferred stock, shares authorized | shares | 20,000,000 | |||||
Common Stock [Abstract] | ||||||
Shelf Registration, sale of corporate securities (up to) | $ 100,000,000 | |||||
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 | $ 85,000,000 | |||||
Initial public offering, underwriting discounts | 6,000,000 | |||||
Initial public offering, issuance costs | 4,200,000 | |||||
Initial public offering, net proceeds | $ 74,800,000 | |||||
Initial public offering, number of shares common stock received in exchange for preferred stock | 2,000,000 | |||||
Common stock | ||||||
Initial Public Offering [Abstract] | ||||||
Initial public offering, shares issued | shares | 30,704 | |||||
Common Stock [Abstract] | ||||||
Share-based compensation, shares | shares | 225,536 | 170,759 | 146,275 | |||
Exercise of options and related tax benefit, shares | shares | 50,000 | 3,409 |
Shareholders' Equity (Warrants,
Shareholders' Equity (Warrants, Narrative) (Details) - $ / shares | 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 |
Shareholders' Equity (Share Rep
Shareholders' Equity (Share Repurchases, Cumberland Emerging Technologies and Cumberland Foundation Narrative) (Details) - USD ($) | Nov. 27, 2019 | Apr. 30, 2019 | Apr. 30, 2014 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | May 31, 2010 |
Equity, Class of Treasury Stock [Line Items] | |||||||
Repurchase of common shares, value | $ 3,486,835 | $ 2,877,935 | $ 3,719,890 | ||||
Amount available under current repurchase program | 8,000,000 | ||||||
Exercise of options and related tax benefit | $ 1,000,000 | ||||||
Payments to acquire interest in subsidiaries | $ 300,000 | ||||||
Loans Forgiven in Exchange For Share Issued, Amount | $ 700,000 | ||||||
Charitable contribution of shares, shares | 50,000 | ||||||
Committed cash contributions | 50,000 | ||||||
Vesting of common stock | $ 862,200 | ||||||
HongKong WinHealth Pharma Group Co. Limited | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Investment in CET | 1,000,000 | ||||||
Gloria Pharmaceuticals | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Exchange for consideration, amount | $ 800,000 | ||||||
Nordic | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Vesting of common stock, shares | 180,000 | ||||||
Vesting of common stock | $ 900,000 | ||||||
Common stock | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Repurchase of common shares, shares | 623,478 | 443,041 | 547,376 | ||||
Repurchase of common shares, value | $ 3,486,835 | $ 2,877,935 | $ 3,719,890 | ||||
Vesting of common stock, shares | 180,000 | ||||||
Vesting of common stock | $ 862,200 | ||||||
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 | 623,478 | 443,041 | 547,376 | ||||
Repurchase of common shares, value | $ 3,500,000 | $ 2,900,000 | $ 3,700,000 | ||||
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, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Numerator: | |||||||||||
Net income (loss) attributable to common shareholders | $ (960,706) | $ (1,953,668) | $ (549,507) | $ (73,878) | $ (2,220,097) | $ (1,643,044) | $ (720,688) | $ (2,379,239) | $ (3,537,759) | $ (6,963,068) | $ (7,978,633) |
Denominator: | |||||||||||
Weighted-average shares outstanding – basic (in shares) | 15,396,098 | 15,614,052 | 15,911,577 | ||||||||
Dilutive effect of restricted stock and stock options (in shares) | 0 | 0 | 0 | ||||||||
Weighted-average shares outstanding – diluted (in shares) | 15,396,098 | 15,614,052 | 15,911,577 |
Earnings (Loss) Per Share (Sc_2
Earnings (Loss) Per Share (Schedule of Anti-dilutive Securities Excluded From Computation of Earnings Per Share) (Details) - shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |||
Anti-dilutive shares (in shares) | 4,000 | 41,650 | 18,325 |
Income Taxes (Operating Loss Ca
Income Taxes (Operating Loss Carryforwards, Narrative) (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 01, 2017 | |
Operating Loss Carryforwards [Line Items] | ||||
Cumulative effect from change in accounting principle (Note 12) | $ 1,082,924 | |||
Valuation allowance | $ 18,511,161 | $ 17,382,052 | ||
Net tax benefit | $ 100,000 | |||
Valuation allowance for deferred tax assets: | ||||
Operating Loss Carryforwards [Line Items] | ||||
Charged to costs and expenses | 1,129,109 | 1,749,817 | $ (665,039) | |
Retained earnings | ||||
Operating Loss Carryforwards [Line Items] | ||||
Cumulative effect from change in accounting principle (Note 12) | $ 1,082,924 | |||
Federal | ||||
Operating Loss Carryforwards [Line Items] | ||||
Operating loss carryforwards | $ 57,181,428 | |||
State | ||||
Operating Loss Carryforwards [Line Items] | ||||
Operating loss carryforwards | $ 60,198,158 |
Income Taxes (Schedule of Defer
Income Taxes (Schedule of Deferred Tax Assets and Liabilities, Net) (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred Tax Assets | ||
Net operating loss and tax credits | $ 16,964,685 | $ 16,410,403 |
Property and equipment and intangibles | 227,072 | 236,318 |
Allowance for accounts receivable | 257,564 | 251,068 |
Reserve for expired product | 469,466 | 558,484 |
Inventory | 35,227 | 193,150 |
Deferred charges | 845,765 | 910,577 |
Cumulative compensation costs incurred on deductible equity awards | 1,047,149 | 884,049 |
Total deferred tax assets | 19,846,928 | 19,444,049 |
Deferred Tax Liabilities | ||
Intangible assets | (1,313,965) | (1,974,787) |
Net deferred tax assets, before valuation allowance | 18,532,963 | 17,469,262 |
Less: deferred tax asset valuation allowance | (18,511,161) | (17,382,052) |
Net deferred tax assets | $ 21,802 | $ 87,210 |
Income Taxes (Schedule of Net O
Income Taxes (Schedule of Net Operating Loss Carryforwards) (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Federal | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | $ 57,181,428 | |
State | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | $ 60,198,158 | |
2020 | Federal | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | 0 | |
2020 | State | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | 13,115 | |
2021 - 2029 | Federal | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | 0 | |
2021 - 2029 | State | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | 49,392,824 | |
2030 | Federal | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | 44,153,819 | |
2030 | State | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | 461,280 | |
2031 - 2039 | Federal | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | 7,534,351 | |
2031 - 2039 | State | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | 9,947,070 | |
Indefinite Period | Federal | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | $ 5,493,258 | |
Indefinite Period | State | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | $ 383,869 |
Income Taxes (Schedule of the C
Income Taxes (Schedule of the Components of Income Tax Benefit (Expense) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Current: | |||
Federal | $ 65,408 | $ 0 | $ 0 |
State and other | 79,316 | (16,636) | (59,243) |
Total current income tax (expense) benefit | 144,724 | (16,636) | (59,243) |
Deferred: | |||
Federal | (65,408) | 0 | (3,682,772) |
State | 0 | 0 | (432,874) |
Deferred income tax (expense) benefit | (65,408) | 0 | (4,115,646) |
Total income tax (expense) benefit | $ 79,316 | $ (16,636) | $ (4,174,889) |
Income Taxes (Schedule of Effec
Income Taxes (Schedule of Effective Income Tax Rate Reconciliation) (Details) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Federal tax expense at statutory rate | 21.00% | 21.00% | 34.00% |
State income tax expense (net of federal income tax benefit) | 4.00% | 4.00% | 4.00% |
Permanent differences associated with general business credits | 7.00% | 1.00% | 1.00% |
Change in valuation allowance | (31.00%) | (25.00%) | (148.00%) |
Change in tax rate | 0 | 0 | 0.02 |
Other permanent differences | 1.00% | (1.00%) | 1.00% |
Other | 0.00% | 0.00% | (2.00%) |
Net income tax expense | 2.00% | 0.00% | (108.00%) |
Stock-Based Compensation Plan_2
Stock-Based Compensation Plans (Narrative) (Details) $ in Millions | 12 Months Ended | |
Dec. 31, 2019planshares | Dec. 31, 2018USD ($) | |
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 | $ | $ 2.1 | |
Unrecognized compensation cost related to share-based payments, period for recognition | 2 years 6 months | |
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 Plan_3
Stock-Based Compensation Plans (Schedule of Share-Based Compensation Expense) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation | $ 1,485,898 | $ 1,364,698 | $ 1,115,063 |
Employee | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation | 1,481,016 | 1,244,606 | 1,032,094 |
Nonemployee | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation | 4,882 | 120,092 | 82,969 |
Foundation Contribution | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation | 0 | 0 | 372,500 |
Employee, Nonemployee and Foundation Contribution | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation | $ 1,485,898 | $ 1,364,698 | $ 1,487,563 |
Stock-Based Compensation Plan_4
Stock-Based Compensation Plans (Schedule of Stock Options Activity) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Number of shares | |||
Outstanding, beginning of period, shares | 5,800 | 5,800 | |
Options granted, shares | 0 | 0 | |
Options exercised, shares | 0 | 0 | |
Options forfeited or expired, shares | (5,800) | 0 | |
Outstanding, end of period, shares | 0 | 5,800 | 5,800 |
Options, exerciseable, end of period, shares | 0 | ||
Weighted-average exercise price per share | |||
Outstanding, beginning of period, weighted-average exercise price per share (in USD per share) | $ 13 | $ 13 | |
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 | 0 | |
Options forfeited or expired, weighted-average exercise price per share (in USD per share) | 13 | 0 | |
Outstanding, end of period, weighted-average exercise price per share (in USD per share) | 0 | $ 13 | $ 13 |
Exercisable, end of period, weighted-average exercise price per share (in USD per share) | $ 0 | ||
Outstanding, end of period, weighted-average remaining contractual term | 0 years | 10 months 24 days | 1 year 10 months 24 days |
Exercisable, end of period, weighted-average remaining contractual term | 0 years | ||
Outstanding, end of period, aggregate intrinsic value | $ 0 | $ 0 | $ 0 |
Exercisable, end of period, aggregate intrinsic value | $ 0 |
Stock-Based Compensation Plan_5
Stock-Based Compensation Plans (Schedule of Stock Option Activity, Additional Disclosures) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Intrinsic value of options exercised | $ 0 | $ 0 | $ 0 |
Weighted-average fair value of options exercised | $ 0 | $ 0 | $ 0 |
Stock-Based Compensation Plan_6
Stock-Based Compensation Plans (Schedule of Restricted Stock Activity) (Details) - Restricted Stock - $ / shares | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Number of shares | ||
Nonvested, beginning of period, shares | 833,741 | 767,845 |
Shares granted, shares | 229,669 | 261,680 |
Shares vested, shares | (225,536) | (170,759) |
Shares forfeited, shares | (22,925) | (25,025) |
Nonvested, end of period, shares | 814,949 | 833,741 |
Weighted- average grant-date fair value | ||
Nonvested, beginning of period, weighted-average grant-date fair value | $ 6.09 | $ 5.61 |
Shares granted, weighted-average grant-date fair value | 5.95 | 6.66 |
Shares vested, weighted-average grant-date fair value | 6.71 | 4.79 |
Shares forfeited, weighted-average grant-date fair value | 6.20 | 6.19 |
Nonvested, end of period, weighted-average grant-date fair value | $ 5.88 | $ 6.09 |
Employee Benefit Plans (Narrati
Employee Benefit Plans (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2017 | Dec. 31, 2016 | |
Defined Contribution Plan [Abstract] | |||
Defined contribution plan, eligibiilty, minimum employee age | 21 years | ||
Defined contribution plan, eligibility, minimum employee service time for participation eligibility | six months | ||
Defined contribution plan, employer discretionary contribution amount | $ 50 | $ 50 | $ 50 |
Deferred Compensation Arrangements [Abstract] | |||
Deferred compensation liability | 2,300 | 1,600 | |
Deferred compensation assets | $ 3,100 | $ 2,300 |
Leases (Narrative) (Details)
Leases (Narrative) (Details) - USD ($) | Dec. 31, 2019 | Jan. 01, 2019 |
Leases [Abstract] | ||
Operating lease right-of-use assets | $ 2,960,569 | $ 3,600,000 |
Present value of lease liabilities | $ 2,996,903 | $ 3,800,000 |
Weighted-average remaining lease term | 3 years 4 months 24 days | |
Weighted-average incremental borrowing rate | 7.42% |
Leases (Schedule of Rent Expens
Leases (Schedule of Rent Expense and Sublease Income) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Leases [Abstract] | |||
Rent expense | $ 1,246,143 | $ 1,136,610 | $ 1,074,437 |
Sublease income | 688,020 | $ 662,358 | $ 573,494 |
Future minimum sublease income under noncancelable operating subleases | $ 700,000 |
Leases (Lease Position) (Detail
Leases (Lease Position) (Details) - USD ($) | Dec. 31, 2019 | Jan. 01, 2019 |
Text Block [Abstract] | ||
Operating lease right-of-use assets | $ 2,960,569 | $ 3,600,000 |
Total | 2,960,569 | |
Operating lease liabilities | 920,431 | |
Operating lease liabilities | 2,076,472 | |
Total | $ 2,996,903 |
Leases (Schedule of Lease Liabi
Leases (Schedule of Lease Liability Maturities and Future Minimum Payments) (Details) - USD ($) | Dec. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
Operating Lease Liabilities, Payments Due [Abstract] | |||
2020 | $ 1,120,066 | ||
2021 | 1,144,889 | ||
2022 | 1,019,313 | ||
2023 | 92,478 | ||
After 2023 | 0 | ||
Total future minimum lease payments | 3,376,746 | ||
Less Interest | (379,843) | ||
Present value of lease liabilities | $ 2,996,903 | $ 3,800,000 | |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |||
2019 | $ 959,902 | ||
2020 | 980,720 | ||
2021 | 1,001,603 | ||
2022 | 871,969 | ||
2023 | 44,508 | ||
After 2023 | 0 | ||
Total future minimum lease payments | $ 3,858,702 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments (Schedule of Fair Value of Financial Instruments by Level in Hierarchy and Narrative) (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | $ 2,119,607 | $ 8,290,679 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 0 | 5,034,955 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 2,119,607 | 3,255,724 |
U.S. Treasury notes and bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 0 | 5,034,955 |
U.S. Treasury notes and bonds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 0 | 5,034,955 |
U.S. Treasury notes and bonds | Level 2 | ||
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 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 0 | 2,504,551 |
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 | 0 | 2,504,551 |
Short-term cash investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 0 | 751,173 |
Short-term cash investments | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 0 | 0 |
Short-term cash investments | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 0 | 751,173 |
Commercial Paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 2,119,607 | 0 |
Commercial Paper | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | 0 | 0 |
Commercial Paper | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of marketable securities | $ 2,119,607 | $ 0 |
Market Concentrations (Schedule
Market Concentrations (Schedule of Revenues Concentration from Major Customers and Narrative) (Details) - Customer Concentration Risk | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Sales Revenue, Goods, Gross | Customer 1 | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 26.00% | 25.00% | 25.00% |
Sales Revenue, Goods, Gross | Customer 2 | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 25.00% | 24.00% | 22.00% |
Sales Revenue, Goods, Gross | Customer 3 | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 16.00% | 26.00% | 25.00% |
Sales Revenue, Goods, Gross | Customer 4 | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 14.00% | 11.00% | |
Accounts Receivable | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 72.00% | 78.00% |
Manufacturing and Supply Agre_2
Manufacturing and Supply Agreements Manufacturing and Supply Agreements (Narrative) (Details) | Dec. 31, 2019supplier |
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 |
Discontinued Operations and D_2
Discontinued Operations and Disposal Groups (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Discontinued Operations and Disposal Groups [Abstract] | |
Financial consideration | $ 5 |
Financial consideration, payment period | 2 years |
Quarterly Financial Informati_3
Quarterly Financial Information (Schedule of Quarterly Financial Information (Unaudited)) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenues | $ 13,678,372 | $ 10,371,918 | $ 11,580,600 | $ 11,902,747 | $ 13,497,906 | $ 8,492,530 | $ 10,163,724 | $ 8,587,605 | $ 47,533,637 | $ 40,741,765 | $ 41,150,131 |
Operating income (loss) | (997,409) | (1,847,085) | (601,715) | (176,796) | (2,262,689) | (1,806,883) | (868,978) | (2,452,222) | (3,623,005) | (7,390,772) | (4,081,348) |
Net income (loss) attributable to common shareholders | $ (960,706) | $ (1,953,668) | $ (549,507) | $ (73,878) | $ (2,220,097) | $ (1,643,044) | $ (720,688) | $ (2,379,239) | $ (3,537,759) | $ (6,963,068) | $ (7,978,633) |
Earnings per share attributable to common shareholders | |||||||||||
Basic (in USD per share) | $ (0.06) | $ (0.13) | $ (0.04) | $ 0 | $ (0.14) | $ (0.11) | $ (0.05) | $ (0.15) | $ (0.23) | $ (0.45) | $ (0.50) |
Diluted (in USD per share) | $ (0.06) | $ (0.13) | $ (0.04) | $ 0 | $ (0.14) | $ (0.11) | $ (0.05) | $ (0.15) | $ (0.23) | $ (0.45) | $ (0.50) |
Valuation and Qualifying Acco_2
Valuation and Qualifying Accounts (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Increase in valuation allowance during the year | $ 4,202,854 | ||
Revaluation of deferred income tax balances for new rates under TCJA | 4,867,893 | ||
Allowance for uncollectible amounts, cash discounts, chargebacks, and credits issued for damaged products: | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at beginning of period | $ 993,340 | $ 507,534 | 449,859 |
Charged to costs and expenses | 7,010,141 | 5,932,248 | 5,066,526 |
Charged to other accounts | 0 | 0 | 0 |
Deductions | (7,195,470) | (5,446,442) | (5,008,851) |
Balance at end of period | 808,011 | 993,340 | 507,534 |
Valuation allowance for deferred tax assets: | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at beginning of period | 17,382,052 | 15,632,235 | 388,500 |
Charged to costs and expenses | 1,129,109 | 1,749,817 | (665,039) |
Charged to other accounts | 0 | 0 | 15,908,774 |
Deductions | 0 | 0 | 0 |
Balance at end of period | $ 18,511,161 | $ 17,382,052 | $ 15,632,235 |