| Segment Reporting Disclosure |
20. Segment Information The Company operates in three reportable segments, Dermatology Product Sales, Pharmaceutical and Biotechnology Product Development and National. The accounting policies of the Company’s segments are the same as those described in Note 2. The following tables summarize, for the periods indicated, operating results by reportable segment: Cost of goods sold is directly related to product sales only. Revenues derived from co-promote revenue, which made up all of the Dermatology Product Sales in the first quarter had no cost of goods sold. As a result, cost of goods sold was only recorded in the three months ended September 30, 2016. | | | Dermatology | | Pharmaceutical and | | | | | | | | ($ in thousands) | | Products | | Biotechnology Product | | | | | | | | Three Months Ended September 30, 2016 | | Sales | | Development | | National | | Consolidated | | | Net Revenue | | $ | 429 | | $ | 546 | | $ | - | | $ | 975 | | | Direct cost of goods | | | (41) | | | - | | | - | | | (41) | | | Sales and marketing costs | | | (1,244) | | | - | | | - | | | (1,244) | | | Research and development | | | - | | | (8,316) | | | - | | | (8,316) | | | General and administrative | | | (422) | | | (7,198) | | | - | | | (7,620) | | | Segment loss from operations | | $ | (1,278) | | $ | (14,968) | | $ | - | | $ | (16,246) | | | Segment assets | | $ | 2,657 | | $ | 103,225 | | $ | 39,539 | | $ | 145,421 | | | | | Dermatology | | Pharmaceutical and | | | | | | ($ in thousands) | | Products | | Biotechnology Product | | | | | | Three Months Ended September 30, 2015 | | Sales | | Development | | Consolidated | | | Net Revenue | | $ | - | | $ | 25 | | $ | 25 | | | Sales and marketing costs | | | (950) | | | - | | | (950) | | | Research and development | | | - | | | (10,968) | | | (10,968) | | | General and administrative | | | (516) | | | (5,663) | | | (6,179) | | | Segment loss from operations | | $ | (1,466) | | $ | (16,606) | | $ | (18,072) | | | Segment assets | | $ | 1,593 | | $ | 85,271 | | $ | 86,864 | | | | | Dermatology | | Pharmaceutical and | | | | | | | | ($ in thousands) | | Products | | Biotechnology | | | | | | | | Nine Months Ended September 30, 2016 | | Sales | | Product Development | | National | | Consolidated | | | Net Revenue | | $ | 1,793 | | $ | 2,072 | | $ | - | | $ | 3,865 | | | Direct cost of goods | | | (365) | | | - | | | - | | | (365) | | | Sales and marketing costs | | | (4,212) | | | - | | | - | | | (4,212) | | | Research and development | | | - | | | (24,559) | | | - | | | (24,559) | | | General and administrative | | | (1,338) | | | (19,864) | | | - | | | (21,202) | | | Segment loss from operations | | $ | (4,122) | | $ | (42,351) | | $ | - | | $ | (46,473) | | | Segment assets | | $ | 2,657 | | $ | 103,225 | | $ | 39,539 | | $ | 145,421 | | | | | Dermatology | | Pharmaceutical and | | | | | | ($ in thousands) | | Products | | Biotechnology Product | | | | | | Nine Months Ended September 30, 2015 | | Sales | | Development | | Consolidated | | | Net Revenue | | $ | - | | $ | 525 | | $ | 525 | | | Direct cost of goods | | | - | | | - | | $ | - | | | Sales and marketing costs | | | (1,632) | | | - | | | (1,632) | | | Research and development | | | - | | | (24,054) | | | (24,054) | | | General and administrative | | | (1,134) | | | (11,610) | | | (12,744) | | | Segment loss from operations | | $ | (2,766) | | $ | (35,139) | | $ | (37,905) | | | Segment assets | | $ | 1,593 | | $ | 85,271 | | $ | 86,864 | | Significant Customers For the three months ended September 30, 2016, two of the Company’s customers accounted for more than 10.0% of its total revenue in the amount of $0.2 million and $43,000, respectively. The revenue from these customers is captured in the product revenue, net line item within the Condensed Consolidated Statement of Operations. For the nine months ended September 30, 2016, three of its customers accounted for more than 10.0% of its total revenue in the amount of $0.8 million, $0.3 million, and $0.3 million, respectively. At September 30, 2016, three of the Company’s customers accounted for more than 10.0% of its total accounts receivable balance in the amount of $0.1 million, $71,000 and $50,000, respectively.
Net Revenue from Pharmaceutical and Biotechnology Product Development represents collaboration revenue from TGTX in connection with Checkpoint, which is classified as related party revenue.
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