4. Inventory

Due to the deferral of revenue under the BARDA Contract (see Note 3 for additional information), amounts that would be otherwise recorded as cost of goods sold for delivered courses are recorded as deferred costs on the balance sheet. The value of inventory represents the costs incurred to manufacture TPOXX® under the BARDA Contract. Additional costs incurred to complete production of courses of TPOXX® will be recorded as inventory and reclassified to deferred costs upon delivery to the extent related revenue is deferred.

Inventory consisted of the following:



	As of
	June 30, 2017		December 31, 2016
Work in-process	$	11,554,379	$	18,916,084
Finished goods	3,862,429		7,293,880
Inventory	$	15,416,808	$	26,209,964

For the three and six months ended June 30, 2017, research and development expenses include net inventory-related losses of approximately $0 and $536,000, respectively. The $536,000 loss for the six months ended June 30, 2017 relates to a $686,000 inventory write-down, partially offset by credits received from contract manufacturing organizations (“CMO”) in connection with the inventory write-down.