Segments and Geographic Information | (6) Segments and Geographic Information The Company and its subsidiaries currently operate in two segments: product and service. The product segment oversees the supply chain and manufacturing of CRINONE, the Company’s sole commercialized product. The product segment included the royalty stream the Company received from Allergan for CRINONE sales in the United States, which ceased with the November 2016 agreement with Allergan, as well as the development of new product candidates. The service segment includes product development, clinical trial manufacturing, and advanced analytical and consulting services for the Company’s customers, as well as the characterizing and developing of pharmaceutical product candidates for the Company’s internal programs and managing certain preclinical activities including manufacturing of the Company’s pipeline products. In September 2013, the Company acquired JPS, a U.K.-based provider of pharmaceutical development, clinical trial manufacturing, and advanced analytical and consulting services to the pharmaceutical industry. The Company has integrated its supply chain management for its sole commercialized product, CRINONE, into those operations and have therefore sought to capture synergies by transferring all operational activities related to its historic business. The Company owns certain plant and equipment physically located at third party contractor facilities in the United Kingdom and Switzerland. The Company conducts its advanced formulation, analytical and consulting services through its subsidiary, JPS. The Company’s largest customer, Merck KGaA, utilizes a Switzerland-based subsidiary to acquire product from the Company, which it then sells throughout the world excluding the United States. The Company’s primary domestic customer, Allergan, Plc (“Allergan”), is responsible for the commercialization and sale of CRINONE in the United States. In November 2016, the Company entered into an agreement with Allergan to monetize future royalty payments. Under the agreement, the Company received a one-time payment of $11.0 million representing all future royalty amounts payable. The following tables show selected information by geographic area (in thousands): Revenues: Three Months Ended March 31, 2017 2016 United States $ 1,628 $ 1,794 Switzerland 7,757 6,341 United Kingdom 949 1,351 Other countries 913 991 Total $ 11,247 $ 10,477 Total assets: March 31, 2017 December 31, 2016 United States $ 21,589 $ 21,423 Switzerland 2,319 4,673 United Kingdom 32,730 31,288 Other countries 171 187 Total $ 56,809 $ 57,571 Long-lived assets: March 31, 2017 December 31, 2016 United States $ 698 $ 663 Switzerland 225 369 United Kingdom 13,983 13,468 Other countries 3 2 Total $ 14,909 $ 14,502 No other individual country represented greater than 10% of total revenues, total assets, or total long-lived assets for any period presented. For the three months ended March 31, 2017, Merck KGaA accounted for 100% of the product segment revenue. For the three months ended March 31, 2016, Merck KGaA and Allergan accounted for 88% and 12% of the product segment revenue, respectively. For the three months ended March 31, 2017 one customer accounted for 17% of the service segment total revenue. No additional customers accounted for 10% or more of the service segment total revenue for the three months ended March 31, 2017. No customers accounted for 10% or more of the service segment total revenue for the three months ended March 31, 2016. For the three months ended March 31, 2017, two customers accounted for 14% and 11% of total service segment accounts receivable, respectively. No other customers accounted for greater than 10% of the service segment accounts receivable. At March 31, 2016, one customer accounted for 11% of total service segment net accounts receivable. The following summarizes other information by segment for the three months ended March 31, 2017 (in thousands): Product Service Total Revenues Product revenues $ 7,726 $ — $ 7,726 Service revenues — 3,521 3,521 Total revenues $ 7,726 $ 3,521 $ 11,247 Cost of product revenues $ 4,313 $ — $ 4,313 Cost of service revenues — 2,243 2,243 Total cost of revenues $ 4,313 $ 2,243 $ 6,556 Gross profit $ 3,413 $ 1,278 $ 4,691 Total operating expenses 6,146 Total non-operating income 14 Loss before income taxes $ (1,441 ) The following summarizes other information by segment for the three months ended March 31, 2016 (in thousands): Product Service Total Revenues Product revenues $ 6,325 $ — $ 6,325 Service revenues — 3,253 3,253 Royalties 899 — 899 Total revenues $ 7,224 $ 3,253 $ 10,477 Cost of product revenues $ 4,027 $ — $ 4,027 Cost of service revenues — 2,323 2,323 Total cost of revenues $ 4,027 $ 2,323 $ 6,350 Gross profit $ 3,197 $ 930 $ 4,127 Total operating expenses 5,865 Total non-operating income 99 Loss before income taxes $ (1,639 ) |