10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

———————

FORM 10-Q

———————

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: June 30, 2016

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FLAMEL TECHNOLOGIES S.A.

(Exact name of registrant as specified in its charter)

———————

Republic of France	000-28508	98-0639540
(State or Other Jurisdiction	(Commission	(I.R.S. Employer
of Incorporation)	File Number)	Identification No.)

Parc Club du Moulin à Vent
33, avenue du Docteur Georges Levy
69200, Vénissieux France

 (Address of Principal Executive Office and Zip Code)

+33 472 78 34 34

 (Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

———————

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes þ No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer þ	Accelerated filer ¨	Non-accelerated filer   ¨	Smaller Reporting Company ¨
		(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No þ

The number of shares of the registrant’s common stock outstanding at August 3, 2016 was 41,241,254.

TABLE OF CONTENTS

		Page #
Forward Looking Statements		3
PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements	4
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	32
Item 4.	Controls and Procedures	33
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	34
Item 1A.	Risk Factors	34
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	34
Item 3.	Defaults Upon Senior Securities	34
Item 4.	Mine Safety Disclosures	34
Item 5.	Other Information	35
Item 6.	Exhibits	39

- 2 -

Forward-Looking Statements

This quarterly report on Form 10-Q includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934 (Exchange Act). The words “will,” “may,” “believe,” “expect,” “anticipate,” “estimate,” “project” and similar expressions, and the negatives thereof, identify forward-looking statements, each of which speaks only as of the date the statement is made. In particular, information appearing under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” includes forward-looking statements.

Although we believe that our forward-looking statements are based on reasonable assumptions within the bounds of our knowledge of our business and operations, our business is subject to significant risks and there can be no assurance that actual results of our research, development and commercialization activities and our results of operations will not differ materially from our expectations.

More information on factors that could cause actual results or events to differ materially from those anticipated is included from time to time in our reports filed with the Securities and Exchange Commission (SEC), including our annual report on Form 10-K for the year ended December 31, 2015, in particular under the captions “Forward-Looking Statements” and “Risk Factors.”

All forward-looking statements speak only as of the date of this report and are expressly qualified in their entirety by the cautionary statements included or referenced in or incorporated by reference into this report. Except as is required by law, we expressly disclaim any obligation to publicly release any revisions to forward-looking statements to reflect events after the date of this report.

- 3 -

PART I – FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

FLAMEL TECHNOLOGIES S.A.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF LOSS

(In thousands, except per share data)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2016			2015			2016			2015
Revenues:
Product sales and services	$	38,165		$	48,602		$	73,518		$	81,128
License and research revenue		693			-			1,556			-
Total		38,858			48,602			75,074			81,128
Operating expenses:
Cost of products and services sold (excluding intangible asset amortization below)		3,907			2,756			7,813			6,386
Research and development expenses		7,604			7,204			12,992			13,226
Selling, general and administrative expenses		11,290			5,873			20,751			10,336
Intangible asset amortization		3,702			3,139			7,216			6,282
Changes in fair value of related party contingent consideration		23,898			32,000			32,141			37,254
Total		50,401			50,972			80,913			73,484
Operating income (loss)		(11,543	)		(2,370	)		(5,839	)		7,644
Investment income, net		390			310			590			974
Interest expense, net		(263	)		-			(438	)		-
Other expense - changes in fair value of related party payable		(2,773	)		(2,726	)		(4,307	)		(2,985	)
Foreign exchange gain (loss)		1,680			(3,565	)		(1,261	)		7,936
Income (loss) before income taxes		(12,509	)		(8,351	)		(11,255	)		13,569
Income tax provision		7,449			8,507			14,761			17,214
Net loss	$	(19,958	)	$	(16,858	)	$	(26,016	)	$	(3,645	)
Net loss per share - basic	$	(0.48	)	$	(0.42	)	$	(0.63	)	$	(0.09	)
Net loss per share - diluted	$	(0.48	)	$	(0.42	)	$	(0.63	)	$	(0.09	)
Weighted average number of shares outstanding - basic		41,241			40,353			41,241			40,281
Weighted average number of shares outstanding - diluted		41,241			40,353			41,241			40,281

See accompanying notes to condensed consolidated financial statements.

- 4 -

FLAMEL TECHNOLOGIES S.A.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(In thousands)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2016			2015			2016			2015
Net loss	$	(19,958	)	$	(16,858	)	$	(26,016	)	$	(3,645	)
Other comprehensive income (loss), net of tax:
Foreign currency translation gain (loss)		(2,457	)		5,262			2,360			(11,387	)
Unrealized gain (loss) on marketable securities, net of ($73), $0, ($158), $0 tax		528			(356	)		1,447			-
Total other comprehensive income (loss), net of tax		(1,929	)		4,906			3,807			(11,387	)
Total comprehensive loss	$	(21,887	)	$	(11,952	)	$	(22,209	)	$	(15,032	)

See accompanying notes to condensed consolidated financial statements.

- 5 -

FLAMEL TECHNOLOGIES S.A.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except per share data)

	June 30,			December 31,
	2016			2015
ASSETS
Current assets:
Cash and cash equivalents	$	23,899		$	65,064
Marketable securities		130,964			79,738
Accounts receivable (net of allowance of $35 at both June 30, 2016 and December 31, 2015)		9,488			7,487
Inventories		3,640			3,666
Research and development tax credit receivable		-			2,382
Prepaid expenses and other current assets		9,657			8,064
Total current assets		177,648			166,401
Property and equipment, net		3,104			2,616
Goodwill		18,669			18,491
Intangible assets, net		29,209			15,825
Research and development tax credit receivable		4,034			-
Income tax deferred charge		11,381			11,581
Other		5,661			167
Total assets	$	249,706		$	215,081
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt	$	283		$	434
Current portion of long-term related party payable		29,500			25,204
Accounts payable		7,043			5,048
Deferred revenue		3,820			5,121
Accrued expenses		10,592			9,308
Income taxes		6,286			-
Other		664			133
Total current liabilities		58,188			45,248
Long-term debt, less current portion		788			684
Long-term related party payable, less current portion		136,021			97,489
Other		2,871			2,526
Total liabilities		197,868			145,947
Shareholders' equity:
Ordinary shares, nominal value of 0.122 euro per share; 53,178 shares authorized;  41,241 issued and outstanding at June 30, 2016 and December 31, 2015		6,331			6,331
Additional paid-in capital		368,897			363,984
Accumulated deficit		(304,540	)		(278,524	)
Accumulated other comprehensive loss		(18,850	)		(22,657	)
Total shareholders' equity		51,838			69,134
Total liabilities and shareholders' equity	$	249,706		$	215,081

See accompanying notes to condensed consolidated financial statements.

- 6 -

FLAMEL TECHNOLOGIES S.A.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

	Six Months Ended
	June 30,
	2016			2015
Cash flows from operating activities:
Net loss	$	(26,016	)	$	(3,645	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		7,681			6,531
Loss on disposal of property and equipment		110			-
Loss on sale of marketable securities		455			225
Unrealized exchange loss (gain)		1,261			(7,315	)
Grants recognized in research and development expenses and operating income		(70	)		(1,086	)
Remeasurement of related party acquisition-related contingent consideration		32,141			37,254
Remeasurement of related party financing-related contingent consideration		4,307			2,985
Change in deferred tax and income tax deferred charge		(5,028	)		3,442
Stock-based compensation expense		4,913			4,152
Increase (decrease) in cash from:
Accounts receivable		(1,689	)		467
Inventories		2,345			1,175
Prepaid expenses and other current assets		546			(1,876	)
Research and development tax credit receivable		(1,630	)		3,807
Accounts payable & other current liabilities		(348	)		2,194
Deferred revenue		(1,461	)		(1,314	)
Accrued expenses		777			(614	)
Accrued income taxes		6,285			(7,636	)
Earn-out payments for related party contingent consideration in excess of acquisition-date fair value		(7,769	)		-
Royalty payments for related party payable in excess of original fair value		(1,159	)		-
Other long-term assets and liabilities		270			555
Net cash provided by operating activities		15,921			39,301
Cash flows from investing activities:
Purchases of property and equipment		(760	)		(659	)
Acquisitions of businesses		161			-
Proceeds from sales of marketable securities		26,013			21,196
Purchase of marketable securities		(75,528	)		(31,093	)
Net cash used in investing activities		(50,114	)		(10,556	)
Cash flows from financing activities:
Earn-out payments for related party contingent consideration		(6,572	)		(6,118	)
Royalty payments for related party payable		(816	)		(888	)
Repayment of debt		-			(4,903	)
Reimbursement of conditional grants		-			(615	)
Cash proceeds from issuance of ordinary shares and warrants		-			1,652
Net cash used in financing activities		(7,388	)		(10,872	)
Effect of exchange rate changes on cash and cash equivalents		416			(2,397	)
Net increase (decrease) in cash and cash equivalents		(41,165	)		15,476
Cash and cash equivalents at January 1		65,064			39,760
Cash and cash equivalents at June 30	$	23,899		$	55,236

See accompanying notes to condensed consolidated financial statements.

- 7 -

FLAMEL TECHNOLOGIES S.A.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share data)

NOTE 1 : Summary of Significant Accounting Policies

Nature of Operations. Flamel Technologies S.A. (“Flamel,” the “Company,” “we” or “us”) is organized as a Société Anonyme, a form of corporation under the laws of The Republic of France. The Company was founded in 1990. Flamel is a specialty pharmaceutical company utilizing core competencies in drug delivery and formulation development to create safer and more efficacious pharmaceutical products to address unmet medical needs and/or reduce overall healthcare costs. The Company has a business model consisting of:

· an Unapproved Marketed Drugs (“UMDs”) business with two approved products in the United States, Bloxiverz^® (neostigmine methylsulfate injection) and Vazculep^® (phenylephrine hydrochloride injection) that are currently marketed, a third product, Akovaz® (ephedrine sulphate injection) for which we obtained FDA approval on April 29, 2016 and which we intend to begin marketing in the third quarter of 2016, and a fourth product currently being studied by us for possible submission for review by the FDA. The UMD business was obtained through the acquisition of Éclat Pharmaceuticals, LLC’s (or “Éclat”) on March 13, 2012,

· a branded pediatric specialty pharmaceutical business, with three FDA approved products and one FDA approved medical device, acquired through the acquisition of FSC Laboratories and FSC Pediatrics (“FSC”) on February 5, 2016; and

· a branded business, focusing on the development of products utilizing Flamel’s proprietary drug delivery platforms. The branded products that are based on Flamel’s proprietary drug delivery platforms target high-value solid and liquid oral and alternative dosage forms using 505(b)(2) and Biosimilar pathways where the Company is able to develop strong intellectual property positions and deliver meaningful patient benefits.

Flamel is headquartered in Lyon, France and has operations in St. Louis, Missouri, United States, and Dublin, Ireland.

Proposed Reincorporation as an Irish Public Limited Company (plc).  At our shareholders meeting on August 10, 2016, our shareholders approved resolutions to change our jurisdiction of incorporation from France to Ireland.  Based on such approval, we intend to give effect to this reincorporation on December 31, 2016 by merging with and into our wholly owned Irish corporate subsidiary, Avadel Pharmaceuticals Limited (the “Merger”).  Prior to completing the Merger, Avadel Pharmaceuticals Limited will re-register as an Irish public limited company, or plc, and at the time of the Merger and thereafter our shareholders (and holders of our American Depositary Shares (ADSs)) will own shares (or ADSs, as applicable) in a company known as Avadel Pharmaceuticals plc.  Our definitive proxy statement filed with the Securities and Exchange Commission on July 5, 2016 contains additional information about the proposed reincorporation.

Basis of Presentation. The Condensed Consolidated Balance Sheet as of December 31, 2015, which is derived from the prior year 2015 audited consolidated financial statements, and the interim unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (U.S. GAAP), the requirements of Form 10-Q and Article 10 of Regulation S-X and, consequently, do not include all information or footnotes required by U.S. GAAP for complete financial statements or all the disclosures normally made in an annual report on Form 10-K. Accordingly, the unaudited condensed consolidated financial statements included herein should be read in conjunction with the audited consolidated financial statements and footnotes included in the Company’s 2015 Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 15, 2016.

The unaudited condensed consolidated financial statements include the accounts of the Company, and reflect all adjustments (consisting only of normal recurring adjustments) that are, in the opinion of management, necessary for a fair presentation of the Company’s financial position, results of operations and cash flows for the dates and periods presented. All intercompany accounts and transactions have been eliminated. Results for interim periods are not necessarily indicative of the results to be expected during the remainder of the current year or for any future period.

Foreign Currency Translation. The reporting currency of the Company and its wholly-owned subsidiaries is the U.S. dollar. Each of the Company's non-U.S. subsidiaries and the parent entity uses local currency as their functional currency. Subsidiaries and entities that do not use the U.S. dollar as their functional currency translate 1) profit and loss accounts at the weighted average exchange rates during the reporting period, 2) assets and liabilities at period end exchange rates and 3) shareholders' equity accounts at historical rates. Resulting translation gains and losses are included as a separate component of shareholders' equity in Accumulated Other Comprehensive Loss. Assets and liabilities denominated in a currency other than the subsidiary's functional currency are translated to the subsidiary's functional currency at period end exchange rates. Resulting gains and losses are recognized in the Condensed Consolidated Statements of Loss.

Reclassifications and Immaterial Corrections of Prior Period Amounts. The accompanying condensed consolidated financial statements for prior periods contain certain reclassifications to conform to the presentation used in 2016. Additionally, the Company has identified certain immaterial errors related to prior reporting periods. The Company has assessed the impact of the errors on its prior period financial statements included in our December 31, 2015 Annual Report on Form 10-K and concluded that the errors were not material to those financial statements.

- 8 -

Although the effect of the errors was not material to any previously issued financial statements, the cumulative effect of correcting the errors would have been material for the period ended June 30, 2016.

Consequently, the Company has presented the effects of these errors and reclassifications on its prior period financial statements in the tables below.  In future filings the financial statements for comparative periods affected by these errors and reclassifications will be revised.

The impact of the above errors and reclassifications on previously presented line items for each comparative period presented is as follows:

	Three Months Ended
	June 30, 2015
				Correction of Immaterial Errors
Consolidated Statement of Loss:	As filed			(a)			(b)			(c)			As revised
Product sales and services	$	49,795		$	-		$	-		$	(1,193	)	$	48,602
Total revenue		49,795			-			-			(1,193	)		48,602
Operating income (loss)		(1,177	)		-			-			(1,193	)		(2,370	)
Income (loss) before income taxes		(7,158	)		-			-			(1,193	)		(8,351	)
Income tax provision		10,242			(292	)		(1,026	)		(417	)		8,507
Net loss		(17,400	)		292			1,026			(776	)		(16,858	)
Net loss per share - basic	$	(0.43	)	$	0.01		$	0.02		$	(0.02	)	$	(0.42	)
Net loss per share - diluted	$	(0.43	)	$	0.01		$	0.02		$	(0.02	)	$	(0.42	)

	Six Months Ended
	June 30, 2015
				Correction of Immaterial Errors
Consolidated Statement of Loss:	As filed			(a)			(b)			(c)			(d)			As revised
Product sales and services	$	82,521		$	-		$	-		$	(1,193	)	$	(200	)	$	81,128
Total revenue		82,521			-			-			(1,193	)		(200	)		81,128
Operating income (loss)		9,037			-			-			(1,193	)		(200	)		7,644
Income (loss) before income taxes		14,962			-			-			(1,193	)		(200	)		13,569
Income tax provision		20,715			(1,158	)		(1,856	)		(417	)		(70	)		17,214
Net loss		(5,753	)		1,158			1,856			(776	)		(130	)		(3,645	)
Net loss per share - basic	$	(0.14	)	$	0.03		$	0.04		$	(0.02	)	$	-		$	(0.09	)
Net loss per share - diluted	$	(0.14	)	$	0.03		$	0.04		$	(0.02	)	$	-		$	(0.09	)

	December 31, 2015
				Correction of Immaterial Errors									Reclassifications
Consolidated Balance Sheet:	As filed			(a)			(e)			(f)			(g)			(h)		As revised
Accounts receivable	$	6,978		$	-		$	-		$	-		$	509		$	-	$	7,487
Inventories		4,155			-			(489	)		-			-			-		3,666
Prepaid expenses and other current assets		7,989			-			-			-			-			75		8,064
Total current assets		166,306			-			(489	)		-			509			75		166,401
Other		158			-			-			-			-			9		167
Total assets		214,977			-			(489	)		-			509			84		215,081
Current portion of long-term related party payable		28,614			-			-			(3,410	)		-			-		25,204
Accounts payable		10,565			-			-			-			(5,517	)		-		5,048
Accrued expenses		3,598			-			-			-			5,710			-		9,308
Income taxes		323			(227	)		(171	)		-			-			75		-
Total current liabilities		48,788			(227	)		(171	)		(3,410	)		193			75		45,248
Long-term related party payable, less current portion		94,079			-			-			3,410			-			-		97,489
Deferred taxes		1,351			(1,360	)		-			-			-			9		-
Other		2,210			-			-			-			316			-		2,526
Total liabilities		147,112			(1,587	)		(171	)		-			509			84		145,947
Accumulated deficit		(279,793	)		1,587			(318	)		-			-			-		(278,524	)
Total shareholders' equity		67,865			1,587			(318	)		-			-			-		69,134
Total liabilities and shareholders' equity		214,977			-			(489	)		-			509			84		215,081

- 9 -

(a)	Reflects the cumulative 2015 correction of $1,587 of income tax benefits related to the deductibility of the U.S. Internal Revenue Code Section 483 imputed interest on contingent consideration liabilities which should have been recorded in prior periods ($866, $292, $863 and ($434) in the first, second, third and fourth quarters of 2015, respectively).
(b)	Reflects the correction of $2,606 of income tax benefits from stock-based compensation and certain other items which were originally recorded in the fourth quarter of 2015 but should have been recorded in prior periods ($360 in 2012, $333 in 2013, $(693) in 2014, and $830, $1,026 and $750 in the first, second and third quarters of 2015, respectively). As these items were originally corrected in the fourth quarter of 2015, no adjustment was required to correct the consolidated balance sheet at December 31, 2015.
(c)	Reflects the correction of a $200 overstatement of revenue in the first quarter of 2015 resulting from errors in certain estimates of ending inventory amounts at our wholesalers which were originally corrected in the first quarter of 2015 but should have been recorded in the fourth quarter of 2014.
(d)	Reflects the correction of a $1,193 understatement in the second quarter of 2015 of the gross to net revenue reserves with respect to estimates for product returns as a result of improper reconciliation to revenue data communicated by service providers. As this item was originally corrected in the third quarter of 2015, no adjustment was required to correct the consolidated balance sheet at December 31, 2015.
(e)	Reflects the correction of a $489 error in the Company’s inventory obsolescence reserve accrual and expense which was originally recorded in the first quarter of 2016 but should have been recorded in the fourth quarter of 2015.
(f)	Reflects the correction of a balance sheet classification error which overstated the current portion of the long-term related party payable by $3,410.
(g)	Reflects revisions to the presentation of certain gross to net revenue reserves which were previously included in accounts payable and are now included in accrued expenses.
(h)	Reflects balance sheet reclassifications required to properly net the accrued income tax and deferred income tax amounts within the balance sheet as a result of the adjustments made in items (a) through (g) above.

In addition to the specific amounts identified within the tables above, the Company also changed the names of the previously-reported “Interest expense – changes in fair value of related party financing related contingent consideration” line on the condensed consolidated statement of income (loss) to “Other expense – changes in fair value of related party payable”, and the previously-reported “Long-term related party contingent consideration payable” line on the condensed consolidated balance sheet to “Long-term related party payable” to better reflect the underlying nature of certain royalty agreements in prior periods.

While the balance sheet revisions and reclassifications noted in the tables above impact their corresponding captions within the cash flows provided by (used in) operating activities section of the Company’s consolidated statements of cash flows in each period of 2015, there was no impact to the total net cash provided by (used in) operating activities in any of these periods.

Revenue. Revenue includes sales of pharmaceutical products, amortization of licensing fees, milestone payments for R&D achievements, and compensation for the execution of R&D activities.

Product Sales and Services

Revenue is generally realized or realizable and earned when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the seller’s price to the buyer is fixed or determinable, and collectability is reasonably assured. The Company records revenue from product sales when title and risk of ownership have been transferred to the customer, which is typically upon delivery to the customer and when the selling price is determinable. As is customary in the pharmaceutical industry, the Company’s gross product sales are subject to a variety of deductions in arriving at reported net product sales. These adjustments include estimates for product returns, chargebacks, payment discounts, rebates, and other sales allowances and are estimated based on analysis of historical data for the product or comparable products, as well as future expectations for such products.

For generic products and branded products sold in mature markets where the ultimate net selling price to customer is estimable, the Company recognizes revenues upon shipment to the wholesaler. For new product launches the Company recognizes revenue once sufficient data is available to determine product acceptance in the marketplace such that product returns may be estimated based on historical data and there is evidence of reorders and consideration is made of wholesaler inventory levels.

Prior to the second quarter 2016, the Company did not have sufficient historical data to estimate certain revenue deductions. As such, it could not accurately estimate the ultimate net selling price of its Éclat portfolio of products and as a result delayed revenue recognition until the wholesaler sold the product through to its customers.

- 10 -

During the second quarter of 2016, the Company determined that it has sufficient evidence, history, data and internal controls to estimate the ultimate selling price of its products upon shipment from its warehouse to its customers, the wholesalers.  Accordingly, it discontinued the sell through revenue approach and now recognizes revenue once the product is shipped from its warehouse. As a result of this change in accounting estimate, the Company recognized $5,981 in additional revenue, or $0.05 in additional diluted net earnings (loss) per share, for the three and six months ended June 30, 2016 that previously would have been deferred until sold by the wholesalers to the hospitals. 

License and Research Revenue

The Company’s license and research revenues consist of fees and milestone payments. Non-refundable fees where we have continuing performance obligations are deferred and are recognized ratably over our projected performance period. We recognize milestone payments, which are typically related to regulatory, commercial or other achievements by us or our licensees and distributors, as revenues when the milestone is accomplished and collection is reasonably assured.

NOTE 2 : Newly Issued Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09 “Revenue from Contracts with Customers” which supersedes the most current revenue recognition requirements. This ASU requires entities to recognize revenue in a way that depicts the transfer of goods or services to customers in an amount that reflects the consideration which the entity expects to be entitled to in exchange for those goods or services. Through May 2016, the FASB issued ASU 2016-08 “Principal versus Agent Considerations (Reporting Revenue Gross versus Net),” ASU 2016-10 “Identifying Performance Obligations and Licensing,” and ASU 2016-12, “Narrow-Scope Improvements and Practical Expedients,” which provide supplemental adoption guidance and clarification to ASU 2014-09, respectively. These ASUs will be effective for annual and interim periods beginning after December 15, 2017 with early adoption for annual and interim periods beginning after December 15, 2016 permitted and should be applied retrospectively to each prior reporting period presented or as a cumulative effect adjustment as of the date of adoption. The Company is currently evaluating this pronouncement to determine the impact of its adoption on its condensed consolidated financial statements.

In March 2016, the FASB issued ASU 2016-09 “Improvements to Employee Share-Based Payment Accounting” which amends Accounting Standards Codification (“ASC”) Topic 718 “Compensation – Stock Compensation”. This update simplifies several aspects of accounting for share-based payment awards to employees, including the accounting for income taxes, classification of awards as either equity or liabilities and classification in the statement of cash flows. The standard is effective for annual reporting periods beginning after December 15, 2016. The Company does not believe this standard will materially impact its condensed consolidated financial statements.

In February 2016, the FASB issued ASU 2016-02 “Leases” which supersedes ASC 840 “Leases” and creates a new topic, ASC 842 “Leases.” This update requires lessees to recognize on their balance sheet a lease liability and a lease asset for all leases, including operating leases, with a term greater than 12 months. The update also expands the required quantitative and qualitative disclosures surrounding leases. This update is effective for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years, with earlier application permitted. This update will be applied using a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The Company is currently evaluating the effect of this update on its condensed consolidated financial statements.

In September 2015, the FASB issued ASU 2015-16 “Business Combinations” which requires that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. This ASU is effective for interim and annual reporting periods beginning after December 15, 2016, with the option to early adopt for financial statements that have not been issued. The Company early adopted the provisions of ASU 2015-16 for the year ended December 31, 2015 on a prospective basis.

In July 2015, the FASB issued ASU 2015-11 “Simplifying the Measurement of Inventory”, which requires an entity to measure inventory within the scope of this ASU at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The effective date for the standard is for fiscal years beginning after December 15, 2016, which for the Company is January 1, 2017. Early adoption is permitted. The new standard is to be applied prospectively. The Company does not expect ASU 2015-11 to have a material impact on its condensed consolidated financial statements.

NOTE 3 : Marketable Securities

The Company has investments in available-for-sale marketable equity securities which are recorded at fair market value and measured using quoted prices in their respective active market, thus representing a level 1 fair value measurement as defined in ASC 820. Unrealized gains and losses are recorded as other comprehensive income (loss) in shareholders’ equity, net of income tax effects.

- 11 -

The value at cost, gross unrealized holding gains or losses, and fair value of the Company’s available-for-sale marketable securities are summarized below as of:

	June 30,			December 31,
Marketable Securities:	2016			2015
Value at cost	$	131,041		$	81,395
Gross unrealized holding gains		1,236			15
Gross unrealized holding losses		(1,313	)		(1,672	)
Fair value	$	130,964		$	79,738

NOTE 4 : Inventories

The principal categories of inventories at June 30, 2016 and December 31, 2015 are as follows:  

	June 30,		December 31,
Inventory:	2016		2015
Finished Goods	$	3,280	$	2,545
Raw Materials		360		1,121
Total	$	3,640	$	3,666

NOTE 5 : Acquisitions

On February 5, 2016, the Company completed its acquisition of FSC Holdings, LLC (“FSC”), a Charlotte, North Carolina-based specialty pharmaceutical company dedicated to providing innovative solutions to unmet medical needs for pediatric patients, from Deerfield CSF, LLC, a Deerfield Management company (“Deerfield”), a related party.

This acquisition has been accounted for using the acquisition method of accounting and, accordingly, its results are included in the Company's condensed consolidated financial statements from the date of acquisition. Total consideration to acquire FSC is estimated to be $22,228, and was funded with a combination of the following, partially offset by $467 as a result of a net working capital settlement due from the seller:

· $15,000 long-term liability to Deerfield. Under the terms of the acquisition agreement, the Company will pay $1,050 annually for five years with a final payment in January 2021 of $15,000.

· $7,695 contingent consideration to Deerfield. Under the terms of the acquisition agreement, the Company shall pay quarterly a 15% royalty on the net sales of certain FSC products, up to $12,500 for a period not exceeding ten years.

The present value of these estimated discounted future cash flows for each of these items is reported in related party payable within the Company’s Condensed Consolidated Balance Sheet, and is further disclosed at Note 7 – Long-Term Related Party Payable.

During the first half of 2016, the Company determined its preliminary accounting for the FSC acquisition. As the Company completes its final accounting for the acquisition, future adjustments related to working capital, amortizable intangible assets, goodwill and deferred taxes could occur. The preliminary fair values assigned to the acquired assets and liabilities have been recognized as follows:

Assigned Fair Value:	2016 Preliminary
Accounts receivable	$	825
Inventories		2,315
Prepaid expenses and other current assets		1,712
Goodwill		178
Intangible assets:
Acquired product marketing rights		16,200
Acquired developed technology		4,400
Other assets		392
Accounts payable and other current liabilities		(3,794	)
Total	$	22,228

Goodwill resulting from the acquisition is largely attributable to the existing workforce of FSC, and is not expected to be deductible for tax purposes. Transaction expenses for legal and professional fees associated with the acquisition of FSC amounted to $76 during the three and six month period ended June 30, 2016 and are reported within the Selling, general and administrative expenses line in the Condensed Consolidated Statements of Loss. The useful lives on FSC acquired intangible assets range from seven to ten years.

- 12 -

After its acquisition on February 5, 2016, FSC contributed $1,761 and $2,637 to the Company's net sales for the three and six month periods ended June 30, 2016, respectively. Concurrently, the net impact of the FSC acquisition was a loss of $3,096 and $4,489 for the three and six month periods ended June 30, 2016, respectively.

Had the FSC acquisition been completed as of the beginning of 2015, the Company's unaudited pro forma net sales and net loss for the six months ended June 30, 2016 and 2015 would have been as follows:

	Six Months Ended
Pro Forma Net Revenue and Losses	June 30, 2016			June 30, 2015
Net revenues	$	75,549		$	83,579
Net loss		(27,030	)		(9,395	)

NOTE 6 : Goodwill and Intangible Assets

The Company's amortizable and unamortizable intangible assets at June 30, 2016 and December 31, 2015 are as follows:

	June 30, 2016							December 31, 2015
	Gross Value		Accumulated Amortization			Net Carrying Amount		Gross Value		Accumulated Amortization			Net Carrying Amount
Amortizable intangible assets:
Acquired developed technology - Bloxiverz	$	35,248	$	(29,373	)	$	5,875	$	35,248	$	(23,498	)	$	11,750
Acquired developed technology - Vazculep		12,061		(8,394	)		3,667		12,061		(7,986	)		4,075
Acquired developed technology - Flexichamber		4,400		(183	)		4,217		-		-			-
Acquired product marketing rights		16,200		(750	)		15,450		-		-			-
Total amortizable intangible assets	$	67,909	$	(38,700	)	$	29,209	$	47,309	$	(31,484	)	$	15,825
Unamortizable intangible assets:
Goodwill	$	18,669	$	-		$	18,669	$	18,491	$	-		$	18,491
Total unamortizable intangible assets	$	18,669	$	-		$	18,669	$	18,491	$	-		$	18,491

The Company recorded amortization expense related to amortizable intangible assets of $3,702 and $3,139 for the three months ended June 30, 2016 and 2015, respectively. The Company recorded amortization expense related to amortizable intangible assets of $7,216 and $6,282 for the six months ended June 30, 2016 and 2015, respectively. Accumulated amortization in the above tables includes an impairment charge of $7,171 which was recognized during the year ended December 31, 2012 relative to the “Acquired developed technology – Vazculep” intangible asset.

Amortizable intangible assets are amortized over their estimated useful lives, which range from three to ten years. Estimated amortization of intangible assets for the next five years is as follows:

Years ending December 31,	Estimated Amortization Expense
2016	$	14,616
2017		3,056
2018		3,056
2019		3,056
2020		3,056
Total	$	26,840

The change in net goodwill during the six months ended June 30, 2016 is as follows:

Goodwill:
Balance - December 31, 2015	$	18,491
Impact of FSC acquisition		178
Balance, June 30 2016	$	18,669

- 13 -

NOTE 7 : Long-Term Related Party Payable

Long-term related party payable and related activity are reported at fair value and consist of the following at June 30, 2016 and December 31, 2015:

				Activity during Six-Months Ended June 30, 2016
									Changes in Fair Value of Related Party Payable
	Balance, December 31, 2015			Additions		Payments to Related Parties			Operating Expense			Other Expense		Balance, June 30, 2016
Acquisition-related contingent consideration:
Warrants - Éclat Pharmaceuticals (a)	$	20,617		$	-	$	-		$	(5,155	)	$	-	$	15,462
Earn-out payments - Éclat Pharmaceuticals (b)		90,468			-		(14,216	)		38,362			-		114,614
Royalty agreement - FSC (c)		-			7,695		(124	)		(1,066	)		-		6,505
Financing-related:
Royalty agreement - Deerfield (d)		7,862			-		(1,337	)		-			2,915		9,440
Royalty agreement - Broadfin (e)		3,746			-		(638	)		-			1,392		4,500
Long-term liability - FSC (f)		-			15,000		-			-			-		15,000
Total related party payable		122,693		$	22,695	$	(16,315	)	$	32,141		$	4,307		165,521
Less: Current portion		(25,204	)												(29,500	)
Total long-term related party payable	$	97,489												$	136,021

(a) As part of the consideration for the Company’s acquisition of Éclat on March 13, 2012, the Company issued two warrants with a six-year term which allow for the purchase of a combined total of 3,300 ordinary shares of Flamel. One warrant is exercisable for 2,200 shares at an exercise price of $7.44 per share, and the other warrant is exercisable for 1,100 shares at an exercise price of $11.00 per share.

 The fair value of the warrants is estimated on a quarterly basis using a Black-Scholes option pricing model with the following assumptions as of June 30:

Deerfield Warrant Valuation	June 30, 2016			June 30, 2015
Weighted average exercise price per share		$ 8.63		$	8.63
Expected term (years)		1.75			2.75
Expected volatility		69.70	%		62.90	%
Risk-free interest rate		0.55	%		0.92	%
Expected dividend yield		-			-

These Black-Scholes fair value measurements are based on significant inputs not observable in the market and thus represent a level 3 measurement as defined in ASC 820. The fair value of the warrant consideration is most sensitive to movement in the Company’s share price and expected volatility at the balance sheet date.

Expected term: The expected term of the options or warrants represents the period of time between the grant date and the time the options or warrants are either exercised or forfeited, including an estimate of future forfeitures for outstanding options or warrants. Given the limited historical data and the grant of stock options and warrants to a limited population, the simplified method has been used to calculate the expected life.

Expected volatility: The expected volatility is calculated based on an average of the historical volatility of the Company's stock price for a period approximating the expected term.

Risk-free interest rate: The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant and a maturity that approximates the expected term.

Expected dividend yield: The Company has not distributed any dividends since its inception, and has no plan to distribute dividends in the foreseeable future.

At the closing date of the 2012 Éclat acquisition and at June 30, 2016, it was uncertain as to whether the Company would ultimately fulfill its obligation under these warrants using Company shares or cash. Accordingly, pursuant to the guidance of ASC 480, the Company determined that these warrants should be classified as a long-term liability. This classification as a long-term liability was further supported by the Company’s determination, pursuant to the guidance of ASC 815-40-15-7(i), that these warrants could also not be considered as being indexed to the Company’s own stock, on the basis that the exercise price for the warrants is determined in U.S. dollars, although the functional currency of the Company at the closing date of the Éclat acquisition was the Euro.

- 14 -

(b) In March 2012, the Company acquired all of the membership interests of Éclat from Breaking Stick Holdings, L.L.C. (“Breaking Stick”, formerly Éclat Holdings), an affiliate of Deerfield. Breaking Stick is majority owned by Deerfield, with a minority interest owned by Mr. Michael Anderson, the Company’s CEO, and certain other current and former employees. As part of the consideration, the Company committed to provide quarterly earn-out payments equal to 20% of any gross profit generated by certain Éclat products. These payments will continue in perpetuity, to the extent gross profit of the related products also continue in perpetuity.

(c) In February 2016, the Company acquired all of the membership interests of FSC from Deerfield. The consideration for this transaction in part included a commitment to pay quarterly a 15% royalty on the net sales of certain FSC products, up to $12,500 for a period not exceeding ten years.

(d) As part of a February 2013 debt financing transaction conducted with Deerfield, the Company received cash of $2,600 in exchange for entering into a royalty agreement whereby the Company shall pay quarterly a 1.75% royalty on the net sales of certain Éclat products until December 31, 2024.

(e) As part of a December 2013 debt financing transaction conducted with Broadfin Healthcare Master Fund, a related party and current shareholder, the Company received cash of $2,200 in exchange for entering into a royalty agreement whereby the Company shall pay quarterly a 0.834% royalty on the net sales of certain Éclat products until December 31, 2024.

(f) In February 2016, the Company acquired all of the membership interests of FSC from Deerfield. The consideration for this transaction in part consists of payments totaling $1,050 annually for five years with a final payment in January 2021 of $15,000.

At June 30, 2016, the fair value of each related party payable listed in (b) through (e) above was estimated using a discounted cash flow model based on probability-adjusted annual net revenues or gross profit, as appropriate, of each of the specified Éclat and FSC products using an appropriate risk-adjusted discount rate ranging from 15% to 32%. These fair value measurements are based on significant inputs not observable in the market and thus represent a level 3 measurement as defined in ASC 820. Subsequent changes in the fair value of the acquisition-related contingent consideration payable, resulting primarily from management’s revision of key assumptions, will be recorded in the ‘Changes in fair value of related party contingent consideration’ line within the Company’s Condensed Consolidated Statements of Loss.

The Company has chosen to make a fair value election pursuant to ASC 825, “Financial Instruments” for its royalty agreements detailed in items (d) and (e) above. These financing-related liabilities are recorded at fair market value on the Condensed Consolidated Balance Sheets and the periodic change in fair market value is recorded as a component of “Other expense – change in fair value of related party payable” on the Condensed Consolidated Statements of Loss.

NOTE 8 : Income Taxes

The components of income (loss) before income taxes are as follows:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2016			2015			2016			2015
United States	$	(2,187	)	$	4,050		$	11,762		$	20,773
France		(2,288	)		(1,123	)		(9,089	)		9,113
Ireland		(8,034	)		(11,278	)		(13,928	)		(16,317	)
Total income (loss) before income taxes	$	(12,509	)	$	(8,351	)	$	(11,255	)	$	13,569

- 15 -

The items accounting for the difference between the income tax provision computed at the French statutory rate and the Company's effective tax rate are as follows:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2016			2015			2016			2015
Statutory tax rate		33.3	%		33.3	%		33.3	%		33.3	%
International tax rates differential		(13.2	)%		(31.8	)%		(27.7	)%		27.6	%
Valuation allowance on net operating losses		(11.9	)%		(16.0	)%		(34.8	)%		2.4	%
Nondeductible contingent consideration		(64.2	)%		(132.3	)%		(96.0	)%		90.9	%
Nondeductible stock-based compensation		(1.7	)%		38.9	%		(3.9	)%		(26.4	)%
Deferred charge from IP transfer		-			(0.2	)%		(4.4	)%		0.5	%
State and local income taxes		(2.8	)%		(1.6	)%		(4.2	)%		1.9	%
Other		0.9	%		8.0	%		6.4	%		(3.4	)%
Effective income tax rate		(59.5	)%		(101.9	)%		(131.2	)%		126.9	%
Income tax provision - at Statutory tax rate	$	(4,165	)	$	(2,781	)	$	(3,748	)	$	4,518
International tax rates differential		1,647			2,658			3,115			3,748
Valuation allowance on net operating losses		1,485			1,338			3,913			332
Nondeductible contingent consideration		8,029			11,049			10,800			12,329
Nondeductible stock-based compensation		216			(3,246	)		434			(3,579	)
Deferred charge from IP transfer		(1	)		17			493			69
State and local income taxes		356			136			477			255
Other		(118	)		(664	)		(723	)		(458	)
Income tax provision - at Effective income tax rate	$	7,449		$	8,507		$	14,761		$	17,214

The income tax provision for the three months ended June 30, 2016 and 2015 was $7,449 and $8,507, respectively. The decrease in the income tax provision for the three months ended June 30, 2016 is primarily the result of decreases in the amount of pre-tax income recorded in the United States and France, when compared to the same period in 2015. The decrease in the income tax provision for the three months ended June 30, 2016 would have been larger, but a tax benefit from stock-based compensation recorded in the same period in 2015 did not repeat in 2016.

The income tax provision for the six months ended June 30, 2016 and 2015 was $14,761 and $17,214, respectively. The decrease in the income tax provision for the six months ended June 30, 2016 is primarily the result of decreases in the amount of pre-tax income recorded in the United States and France, when compared to the same period in 2015. The decrease in the income tax provision for the six months ended June 30, 2016 would have been larger, but a tax benefit from stock-based compensation recorded in the same period in 2015 did not repeat in 2016 and the Company was required to record a valuation allowance against the net operating losses generated in France in 2016.

- 16 -

NOTE 9 : Other Assets and Liabilities

Various other assets and liabilities are summarized as follows:

	June 30,		December 31,
Prepaid expenses and other current assets:	2016		2015
Valued-added tax recoverable	$	1,216	$	1,099
Prepaid expenses		3,457		2,921
Advance to suppliers and other current assets		1,604		518
Income tax receivable		3,380		3,526
Total	$	9,657	$	8,064

	June 30,		December 31,
Other non-current assets:	2016		2015
Deferred tax assets	$	5,542	$	-
Other		119		167
Total	$	5,661	$	167

	June 30,		December 31,
Accrued expenses:	2016		2015
Accrued compensation	$	2,383	$	1,888
Accrued social charges		1,132		1,710
Accrued trade discounts and rebates		6,914		5,710
Other		163		-
Total	$	10,592	$	9,308

	June 30,		December 31,
Other current liabilities:	2016		2015
Valued-added tax payable	$	185	$	-
Other		479		133
Total	$	664	$	133

	June 30,		December 31,
Other non-current liabilities:	2016		2015
Provision for retirement indemnity	$	2,274	$	2,170
Other		597		356
Total	$	2,871	$	2,526

NOTE 10 : Net Loss Per Share

Basic net loss per share is calculated using the weighted average number of shares outstanding during each period. The diluted net loss per share calculation includes the impact of dilutive equity compensation awards and contingent consideration warrants.

A reconciliation of basic and diluted net loss per share, together with the related shares outstanding in thousands is as follows:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
Loss Per Share	2016			2015			2016			2015
Net loss	$	(19,958	)	$	(16,858	)	$	(26,016	)	$	(3,645	)
Weighted average shares:
Basic shares		41,241			40,353			41,241			40,281
Effect of dilutive securities—options and warrants outstanding		-			-			-			-
Diluted shares		41,241			40,353			41,241			40,281
Net loss per share - basic	$	(0.48	)	$	(0.42	)	$	(0.63	)	$	(0.09	)
Net loss per share - diluted	$	(0.48	)	$	(0.42	)	$	(0.63	)	$	(0.09	)

Potential common shares of 6,596 and 6,634 were excluded from the calculation of weighted average shares for the three and six months ended June 30, 2016 and 2015, respectively, because their effect was considered to be anti-dilutive.

- 17 -

NOTE 11 : Comprehensive Income (Loss)

The following table shows the components of accumulated other comprehensive loss for the three and six months ended June 30, 2016 and 2015, net of tax effects:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
Accumulated Other Comprehensive Loss	2016			2015			2016			2015
Foreign currency translation adjustment:
Beginning balance	$	(17,495	)	$	(23,874	)	$	(22,312	)	$	(7,225	)
Net other comprehensive (loss) income		(2,457	)		5,262			2,360			(11,387	)
Balance at June 30	$	(19,952	)	$	(18,612	)	$	(19,952	)	$	(18,612	)
Unrealized gain (loss) on marketable securities, net
Beginning balance	$	574		$	158		$	(345	)	$	(198	)
Net other comprehensive (loss) income, net of ($73), $0, ($158), $0 tax		528			(356	)		1,447			-
Balance at June 30	$	1,102		$	(198	)	$	1,102		$	(198	)
Accumulated Other Comprehensive Loss at June 30	$	(18,850	)	$	(18,810	)	$	(18,850	)	$	(18,810	)

The effect on the Company’s condensed consolidated financial statements of amounts reclassified out of accumulated other comprehensive loss was immaterial for all periods presented.

NOTE 12 : Shareholders’ Equity

The following table presents a reconciliation of the Company’s beginning and ending balances in shareholders’ equity for the six months ended June 30, 2016:

	Six Months Ended
Shareholders' Equity	June 30, 2016
Shareholders' equity - January 1	$	69,134
Net loss		(26,016	)
Other comprehensive income		3,807
Stock-based compensation expense		4,913
Shareholders' equity - June 30	$	51,838

NOTE 13 : Company Operations by Product

The Company has determined that it operates in one segment, the development and commercialization of pharmaceutical products, including controlled-release therapeutic products based on its proprietary polymer based technology. The Company's Chief Operating Decision Maker is the CEO. The CEO and the Board review profit and loss information on a consolidated basis to assess performance and make overall operating decisions as well as resource allocations. All products are included in one segment because the majority of our products have similar economic and other characteristics, including the nature of the products and production processes, type of customers, distribution methods and regulatory environment.

The following table presents a summary of total revenues by these products:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Revenues	2016		2015		2016		2015
Bloxiverz	$	25,620	$	44,283	$	50,367	$	72,726
Vazculep		10,421		3,627		19,827		7,151
Other		2,124		692		3,324		1,251
Total product sales and services		38,165		48,602		73,518		81,128
License and research revenue		693		-		1,556		-
Total revenues	$	38,858	$	48,602	$	75,074	$	81,128

- 18 -

NOTE 14 : Commitments and Contingencies

Litigation

The Company is subject to potential liabilities generally incidental to its business arising out of present and future lawsuits and claims related to product liability, personal injury, contract, commercial, intellectual property, tax, employment, compliance and other matters that arise in the ordinary course of business. The Company accrues for potential liabilities when it is probable that future costs (including legal fees and expenses) will be incurred and such costs can be reasonably estimated. At June 30, 2016 and December 31, 2015, there were no contingent liabilities with respect to any threat of litigation, arbitration or administrative or other proceeding that are reasonably likely to have a material adverse effect on the Company’s condensed consolidated financial position, results of operations, cash flows or liquidity.

Material Commitments

Other than commitments to Recipharm and for operating leases as disclosed in Note 12 - Contingent Liabilities and Commitments to the Company's consolidated financial statements included in Part II, Item 8 of the Company’s 2015 Annual Report, there were no other material commitments outside of the normal course of business. Material commitments in the normal course of business include long-term debt, and post-retirement benefit plan obligations which are disclosed in Note 7 - Long-Term Debt and Note 10 – Post-Retirement Benefit Plans, respectively, to the Company's consolidated financial statements included in Part II, Item 8 of the Company’s 2015 Annual Report and long-term contingent consideration payable as disclosed in Note 7 – Long-term Related Party Payable, to the Company's condensed consolidated financial statements included in Part I, Item 1 of this report.

- 19 -

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Management's Discussion and Analysis

(In thousands, except per share data)

(Unaudited)

You should read the discussion and analysis of our financial condition and results of operations set forth in this Item 2 together with our condensed consolidated financial statements and the related notes appearing elsewhere in this quarterly report on Form 10-Q. Some of the information contained in this discussion and analysis or set forth elsewhere in this quarterly report on Form 10-Q, including information with respect to our plans and strategy for our business and related financing, includes forward-looking statements that involve risks and uncertainties, and reference is made to the “Cautionary Disclosure Regarding Forward-Looking Statements” set forth immediately following the Table of Content of the Company’s 2015 Annual Report on Form 10-K filed with the SEC on March 15, 2016 (the “2015 Annual Report”) for further information on the forward looking statements herein. In addition, you should read the “Risk Factors” section in Part I, Item 1A of the 2015 Annual Report for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis and elsewhere in this quarterly report.

Overview

We are a specialty pharmaceutical company utilizing core competencies in drug delivery and formulation to develop safer and more efficacious pharmaceutical products to address unmet medical needs and/or reduce overall healthcare costs. Flamel has a business model consisting of:

· an Unapproved Marketed Drugs (“UMDs”) business with two approved products in the United States, Bloxiverz^® (neostigmine methylsulfate injection) and Vazculep^® (phenylephrine hydrochloride injection) that are currently marketed, a third product, Akovaz® (ephedrine sulphate injection) for which we obtained FDA approval on April 29, 2016 and which we intend to begin marketing in the third quarter of 2016, and a fourth product currently being studied by us for possible submission for review by the FDA. The UMD business was obtained through the acquisition of Éclat on March 13, 2012,

· a branded pediatric specialty pharmaceutical business, with three FDA approved products and one FDA approved medical device, acquired through the acquisition of FSC on February 5, 2016; and

· a branded business, focusing on the development of products utilizing Flamel’s proprietary drug delivery platforms. The branded products that are based on Flamel’s proprietary drug delivery platforms target high-value solid and liquid oral and alternative dosage forms using 505(b)(2) and Biosimilar pathways where the Company is able to develop strong intellectual property positions and deliver meaningful patient benefits.

Flamel’s business model allows the Company to select, develop, seek approval for, and commercialize niche branded and generic products, initially targeted for the U.S. market. The Company is currently able to self-fund the development of most product development opportunities. On May 2, 2016, the company announced that the U.S. Food and Drug Administration (FDA) has approved the Company’s New Drug Application (NDA) for Akovaz™ (ephedrine sulfate), a drug administered parenterally as a pressor agent to address clinically important hypotension in surgical settings. The NDA, which is the first to receive approval from the FDA for ephedrine sulfate, was approved as scheduled on April 29, 2016. Flamel expects to launch Akovaz during the third quarter 2016 in a strength of 50mg/mL.

Strategy

The Company's business strategy is designed to drive overall sales and earnings growth while maintaining a return on invested capital at an appropriate premium above the Company's cost of capital. Our key areas of focus address the most significant opportunities and challenges facing the Company, including:

· Unapproved Marketed Drug Development: The Company now derives cash flow and profitability from the sales of two of its UMD products. During the three and six months ended June 30, 2016 the Company generated $36,041 and $70,194 of sales from the UMD products compared to $47,910 and $79,877 in the same period of 2015, respectively.

o The first UMD product, Bloxiverz, which had sales of $25,620 and $50,367 for the three and six months ended June 30, 2016, respectively, was approved by the FDA on May 31, 2013, and is currently being marketed in the U.S.

o The second UMD product, Vazculep, which had sales of $10,421 and $19,827 for the three and six months ended June 30, 2016, respectively, was approved by the FDA on June 27, 2014 and launched in October 2014 in the U.S.

o A third UMD product, Akovaz, the brand name for the Company’s ephedrine sulfate injection, obtained NDA approval on April 29, 2016. We expect to begin marketing this product before September 30, 2016.

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Each of the above products are currently or will be commercialized in the United States by Flamel’s subsidiary Éclat. These products were derived from the acquisition of Éclat, which has focused on pursuing FDA approvals through the 505(b)(2) regulatory pathway. Through our acquisition of Éclat we obtained marketing and licensing knowledge of the commercial and regulatory process in the U.S. and E.U. We believe this knowledge has enhanced our ability to identify product candidates for development, leverage new opportunities for the application of our drug delivery platforms, and license and market products in the U.S and E.U. The revenues from these UMD products are now generating cash flow which we can use to fund our second strategy, the development and commercialization of our drug delivery products.

· Development and Commercialization of the Company’s Drug Delivery Pipeline Products: In addition to the UMD strategy, the Company is continuing to advance the commercialization of its innovative drug delivery platforms. We have now enhanced our ability to identify new product candidates and to pursue commercial opportunities associated with our drug delivery platforms. The Company’s drug delivery platforms allow the creation of competitive and differentiated drug product profiles (e.g., with improved pharmacokinetics, efficacy and/or safety). Flamel owns and develops drug delivery platforms that address key formulation challenges, leading to the development of differentiated drug products for administration in various forms (e.g., capsules, tablets, sachets or liquid suspensions for oral use; or injectables for subcutaneous administration) and can be applied to a broad range of drugs (novel, already-marketed, or off-patent). These product development opportunities allow us to protect our products through patent protection and product differentiation. As a result of developing its own drug delivery platforms the Company’s business is now less dependent on the development activities performed by partners, and relies more on the development of its own, self-funded, products. Our proprietary drug delivery platforms include:

o Micropump^® is a microparticulate system that allows the development and marketing of modified and/or controlled release of solid, oral dosage formulations of drugs (Micropump®-carvedilol and Micropump®-aspirin formulations have been approved in the U.S. and in the E.U., respectively.

o LiquiTime^® allows development of modified/controlled release oral products in a liquid suspension formulation particularly suited to children or for patients having issues swallowing tablets or capsules.

o Trigger Lock^™ allows development of abuse-resistant modified/controlled release formulations of narcotic/opioid analgesics and other drugs susceptible to abuse.

o Medusa^™ allows the development of extended/modified release of injectable dosage formulations of drugs (e.g., peptides, polypeptides, proteins, and small molecules).

Several products formulated using our proprietary drug delivery platforms are currently under various stages of development for possible marketing either by the Company and/or by partners via licensing/distribution agreements.

The key elements of our pipeline strategy include:

o Continuing to build commercially successful products utilizing Micropump;

o Identifying opportunities and optimizing time-to-market for our (not yet approved) drug delivery platforms, i.e., LiquiTime, Trigger Lock and Medusa;

o Maximizing the technical potential of our existing drug delivery platforms for developing new and proprietary products; and

o Developing and validating improved and complementary drug delivery platforms related to our current drug delivery capabilities.

· Inorganic growth through Acquisitions and/or Partnerships: The Company maintains a strong balance sheet with substantial liquidity and little long term debt. As part of its overall enterprise strategy, the Company expects to explore and pursue appropriate inorganic growth opportunities that complement its drug delivery platforms or acquire proprietary products that enhance profitability and cash flow. This was evidenced in early 2016 with the acquisition of FSC, a specialty pharmaceutical company dedicated to providing innovative solutions to unmet medical needs for pediatric patients. Additionally, the Company will leverage the capabilities of its existing and future proprietary products and/or drug delivery platforms with pharmaceutical and biotechnology partnerships or licensing transactions. In 2015, the Company completed a licensing transaction for its LiquiTime technology-based OTC products which was licensed to Elan Pharma International Limited.

Key Business Trends and Highlights

In operating our business and monitoring our performance, we consider a number of performance measures, as well as trends affecting our industry as a whole, which include the following:

· Healthcare and Regulatory Reform: Various health care reform laws in the U.S. may impact our ability to successfully commercialize our products and technologies. The success of our commercialization efforts may depend on the extent to which the government health administration authorities, the health insurance funds in the E.U. Member States, private health insurers and other third party payers in the U.S. will reimburse consumers for the cost of healthcare products and services.

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· Pricing Environment for Pharmaceuticals: The pricing environment continues to be in the spotlight of many regulators. As a result the need to obtain and maintain appropriate pricing and reimbursement for our products may become more challenging due to, among other things, the attention being paid to healthcare cost containment and other austerity measures in the U.S. and worldwide.

· Generics Playing a Larger Role in Healthcare: Generic pharmaceutical products will continue to play a large role in the U.S. healthcare system. Specifically the Company has seen additional generic competition to its products and continues to expect generic competition in the future.

· Access to and Cost of Capital: The recent tightening of credit in the U.S. may create challenges for the Company if it were to have the need to raise capital. Currently the Company has no needs to raise capital.

Highlights of our condensed consolidated results for the six months ended June 30, 2016 are as follows:

· Revenue was $38,858 and $75,074 for the three and six months ended June 30, 2016, respectively, compared to $48,602 and $81,128 in the same periods last year. This decrease was primarily the result of a decrease in Bloxiverz sales volume as a result of additional competition, partially offset by an increase in sales volume and pricing of Vazculep.

· Operating loss was $11,543 and $5,839 for the three and six months ended June 30, 2016, respectively, compared to operating loss of $2,370 and operating income of $7,644 in the same periods last year.

· Net loss was $19,958 and $26,016 for the three and six months ended June 30, 2016, respectively, compared to $16,858 and $3,645 in the same periods last year. These increases were largely driven by a decrease in sales and increases in selling, general and administrative expenses in the current year.

· Diluted net loss per share was $0.48 and $0.63 for the three and six months ended June 30, 2016, respectively, compared to $0.42 and $0.09 in the same periods last year.

· Cash and marketable securities increased $10,061 to $154,863 from $144,802 at December 31, 2015.

Critical Accounting Estimates

The Company’s condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. To prepare these financial statements, management must make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, as well as the disclosures of contingent assets and liabilities. Actual results could be significantly different from these estimates.

Our significant accounting policies are described in Note 1 of the audited consolidated financial statements included in our 2015 Form 10-K. The SEC suggests companies provide additional disclosure on those accounting policies considered most critical. The SEC considers an accounting policy to be critical if it is important to our financial condition and results of operations and requires significant judgments and estimates on the part of management in its application. Our estimates are often based on complex judgments, probabilities and assumptions that management believes to be reasonable, but that are inherently uncertain and unpredictable. It is also possible that other professionals, applying reasonable judgment to the same facts and circumstances, could develop and support a range of alternative estimated amounts. For a complete discussion of our critical accounting policies, see the “Critical Accounting Policies” section of the MD&A in our 2015 Form 10-K. There were no significant changes to our critical accounting policies, with the exception of changes made to our revenue recognition policy disclosed below, during the six months ended June 30, 2016.

Revenue. Revenue includes sales of pharmaceutical products, amortization of licensing fees, milestone payments for R&D achievements, and compensation for the execution of R&D activities.

Product Sales and Services

Revenue is generally realized or realizable and earned when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the seller’s price to the buyer is fixed or determinable, and collectability is reasonably assured. The Company records revenue from product sales when title and risk of ownership have been transferred to the customer, which is typically upon delivery to the customer and when the selling price is determinable. As is customary in the pharmaceutical industry, the Company’s gross product sales are subject to a variety of deductions in arriving at reported net product sales. These adjustments include estimates for product returns, chargebacks, payment discounts, rebates, and other sales allowances and are estimated based on analysis of historical data for the product or comparable products, as well as future expectations for such products.

For generic products and branded products sold in mature markets where the ultimate net selling price to customer is estimable, the Company recognizes revenues upon shipment to the wholesaler. For new product launches the Company recognizes revenue once sufficient data is available to determine product acceptance in the marketplace such that product returns may be estimated based on historical data and there is evidence of reorders and consideration is made of wholesaler inventory levels.

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Prior to the second quarter 2016, the Company did not have sufficient historical data to estimate certain revenue deductions. As such, it could not accurately estimate the ultimate net selling price of its Éclat portfolio of products and as a result delayed revenue recognition until the wholesaler sold the product through to its customers.

During the second quarter of 2016, the Company determined that it has sufficient evidence, history, data and internal controls to estimate the ultimate selling price of its products upon shipment from its warehouse to its customers, the wholesalers.  Accordingly, it discontinued the sell through revenue approach and now recognizes revenue once the product is shipped from its warehouse. As a result of this change in accounting estimate, the Company recognized $5,981 in additional revenue for the three and six months ended June 30, 2016 that previously would have been deferred until sold by the wholesalers to the hospitals.  The impact of this change is reflected as revenue in the Company’s Condensed Consolidated Statements of Loss for the periods reported.

License and Research Revenue

The Company’s license and research revenues consist of fees and milestone payments. Non-refundable fees where we have continuing performance obligations are deferred and are recognized ratably over our projected performance period. We recognize milestone payments, which are typically related to regulatory, commercial or other achievements by us or our licensees and distributors, as revenues when the milestone is accomplished and collection is reasonably assured.

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Results of Operations

The following is a summary of our financial results (in thousands, except per share amounts) for the three months ended June 30, 2016 and 2015, respectively:

							Three Months Ended
	Three Months Ended						Increase / (Decrease)
	June 30,						2016 vs. 2015
Comparative Statements of Loss	2016			2015			$			%
Product sales and services	$	38,165		$	48,602		$	(10,437	)		(21.5	)%
License and research revenue		693			-			693			n/a
Total revenues		38,858			48,602			(9,744	)		(20.0	)%
Cost of products and services sold		3,907			2,756			1,151			41.8	%
Research and development expenses		7,604			7,204			400			5.6	%
Selling, general and administrative expenses		11,290			5,873			5,417			92.2	%
Intangible asset amortization		3,702			3,139			563			17.9	%
Changes in fair value of related party contingent consideration		23,898			32,000			(8,102	)		(25.3	)%
Total operating expenses		50,401			50,972			(571	)		(1.1	)%
Operating income (loss)		(11,543	)		(2,370	)		(9,173	)		(387.0	)%
Investment income		390			310			80			25.8	%
Interest expense		(263	)		-			(263	)		n/a
Other expense - changes in fair value of related party payable		(2,773	)		(2,726	)		(47	)		(1.7	)%
Foreign exchange gain (loss)		1,680			(3,565	)		5,245			147.1	%
Income (loss) before income taxes		(12,509	)		(8,351	)		(4,158	)		(49.8	)%
Income tax provision		7,449			8,507			(1,058	)		(12.4	)%
Net loss	$	(19,958	)	$	(16,858	)	$	(3,100	)		(18.4	)%
Loss per share - diluted	$	(0.48	)	$	(0.42	)	$	(0.06	)		(14.3	)%

The following is a summary of our financial results (in thousands, except per share amounts) for the six months ended June 30, 2016 and 2015, respectively:

							Six Months Ended
	Six Months Ended						Increase / (Decrease)
	June 30,						2016 vs. 2015
Comparative Statements of Loss	2016			2015			$			%
Product sales and services	$	73,518		$	81,128		$	(7,610	)		(9.4	)%
License and research revenue		1,556			-			1,556			n/a
Total revenues		75,074			81,128			(6,054	)		(7.5	)%
Cost of products and services sold		7,813			6,386			1,427			22.3	%
Research and development expenses		12,992			13,226			(234	)		(1.8	)%
Selling, general and administrative expenses		20,751			10,336			10,415			100.8	%
Intangible asset amortization		7,216			6,282			934			14.9	%
Changes in fair value of related party contingent consideration		32,141			37,254			(5,113	)		(13.7	)%
Total operating expenses		80,913			73,484			7,429			10.1	%
Operating income (loss)		(5,839	)		7,644			(13,483	)		(176.4	)%
Investment income		590			974			(384	)		(39.4	)%
Interest expense		(438	)		-			(438	)		n/a
Other expense - changes in fair value of related party payable		(4,307	)		(2,985	)		(1,322	)		(44.3	)%
Foreign exchange gain (loss)		(1,261	)		7,936			(9,197	)		(115.9	)%
Income (loss) before income taxes		(11,255	)		13,569			(24,824	)		(182.9	)%
Income tax provision		14,761			17,214			(2,453	)		(14.3	)%
Net loss	$	(26,016	)	$	(3,645	)	$	(22,371	)		(613.7	)%
Loss per share - diluted	$	(0.63	)	$	(0.09	)	$	(0.54	)		(600.0	)%

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Revenues

The revenues for each of the Company's significant products for the three months ended June 30, 2016 were as follows:

					Three Months Ended
	Three Months Ended				Increase / (Decrease)
	June 30,				2016 vs. 2015
Revenues:	2016		2015		$			%
Bloxiverz	$	25,620	$	44,283	$	(18,663	)		(42.1	)%
Vazculep		10,421		3,627		6,794			187.3	%
Other		2,124		692		1,432			206.9	%
Total product sales and services		38,165		48,602		(10,437	)		(21.5	)%
License and research revenue		693		-		693			n/a
Total revenues	$	38,858	$	48,602	$	(9,744	)		(20.0	)%

Product sales and services revenues were $38,165 for the three months ended June 30, 2016, compared to $48,602 for the same prior year period. This included $5,981 in additional revenue as a result of our change in accounting estimate as previously described under “Critical Accounting Estimates.” Excluding the impact of this revenue change, total product sales and services for the three months ended June 30, 2016 would have been $32,184, a decline of $16,418 when compared to the same period last year. Bloxiverz’s revenue declined $18,663 quarter over quarter, primarily due to a $23,260 loss of market share and net selling price in Bloxiverz driven largely by two new competitors that entered the market subsequent to the first quarter of 2015, partially offset by an increase of $4,597 related to the change in revenue estimate noted above. Vazculep’s revenue increased $6,794 quarter over quarter due primarily to higher market share resulting from its launch in early 2015, which was further increased by $1,384 related to the change in revenue estimate noted above. The acquisition of FSC in February 2016 contributed $1,761 to product sales for the three months ended June 30, 2016.

License and research revenues increased $693 during the quarter ended June 30, 2016 compared to the same prior year period, driven primarily by the Company’s entrance into an exclusive licensing agreement of our LiquiTime drug delivery platform for the U.S. (OTC) drug market during the third quarter of 2015.

The revenues for each of the Company's significant products for the six months ended June 30, 2016 were as follows:

					Six Months Ended
	Six Months Ended				Increase / (Decrease)
	June 30,				2016 vs. 2015
Revenues:	2016		2015		$			%
Bloxiverz	$	50,367	$	72,726	$	(22,359	)		(30.7	)%
Vazculep		19,827		7,151		12,676			177.3	%
Other		3,324		1,251		2,073			165.7	%
Total product sales and services		73,518		81,128		(7,610	)		(9.4	)%
License and research revenue		1,556		-		1,556			n/a
Total revenues	$	75,074	$	81,128	$	(6,054	)		(7.5	)%

Product sales and services revenues were $73,518 for the six months ended June 30, 2016, compared to $81,128 for the same prior year period. Excluding the impact of the revenue change noted above, total product sales and services for the six months ended June 30, 2016 would have been $67,537, a decline of $13,591 when compared to the same period last year. Bloxiverz’s revenue declined $22,359 when compared to the same period last year, primarily due to a $26,956 loss of market share and net selling price in Bloxiverz driven largely by two new competitors that entered the market subsequent to the first quarter of 2015, partially offset by an increase of $4,597 related to the change in revenue estimate noted above. Vazculep’s revenue increased $12,676 when compared to the same period last year due primarily to higher market share resulting from its launch in early 2015, which was further increased by $1,384 related to the change in revenue estimate noted above. The acquisition of FSC in February 2016 contributed $2,637 in revenues for the six months ended June 30, 2016.

License and research revenues increased $1,556 during the six months ended June 30, 2016 compared to the same prior year period, driven primarily by the Company’s entrance into an exclusive licensing agreement of our LiquiTime drug delivery platform for the U.S. (OTC) drug market during the third quarter of 2015.

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Cost of Products and Services Sold

							Three Months Ended
	Three Months Ended						Increase / (Decrease)
	June 30,						2016 vs. 2015
Cost of Products and Services Sold:	2016			2015			$		%
Cost of products and services sold	$	3,907		$	2,756		$	1,151		41.8	%
Percentage of sales		10.1	%		5.7	%

Cost of products and services sold increased $1,151 or 41.8% during the three months ended June 30, 2016 compared to the same prior year period primarily due to increases in respective product sales and services. As a percentage of sales, cost of products sold was higher than the prior year period due to product mix, largely related to the acquisition of FSC.

							Six Months Ended
	Six Months Ended						Increase / (Decrease)
	June 30,						2016 vs. 2015
Cost of Products and Services Sold:	2016			2015			$		%
Cost of products and services sold	$	7,813		$	6,386		$	1,427		22.3	%
Percentage of sales		10.4	%		7.9	%

Cost of products and services sold increased $1,427 or 22.3% during the six months ended June 30, 2016 compared to the same prior year period primarily due to increases in respective product sales and services. As a percentage of sales, cost of products sold was slightly higher than the prior year period due to product mix, largely related to the acquisition of FSC.

Research and Development Expenses

							Three Months Ended
	Three Months Ended						Increase / (Decrease)
	June 30,						2016 vs. 2015
Research and Development Expenses:	2016			2015			$		%
Research and development expenses	$	7,604		$	7,204		$	400		5.6	%
Percentage of sales		19.6	%		14.8	%

Research and development expenses increased $400 or 5.6% during the three months ended June 30, 2016 as compared to the same period in 2015 primarily due to higher payroll and outside services costs related to feasibility studies and clinical programs including sodium oxybate. The impact of changes in foreign currency exchange rates also increased R&D when compared to the same period last year.

							Six Months Ended
	Six Months Ended						Increase / (Decrease)
	June 30,						2016 vs. 2015
Research and Development Expenses:	2016			2015			$			%
Research and development expenses	$	12,992		$	13,226		$	(234	)		(1.8	)%
Percentage of sales		17.3	%		16.3	%

Research and development expenses decreased $234 or 1.8% during the six months ended June 30, 2016 as compared to the same prior year period primarily due to the timing of clinical studies and outside services costs.

Selling, General and Administrative Expenses

							Three Months Ended
	Three Months Ended						Increase / (Decrease)
	June 30,						2016 vs. 2015
Selling, General and Administrative Expenses:	2016			2015			$		%
Selling, general and administrative expenses	$	11,290		$	5,873		$	5,417		92.2	%
Percentage of sales		29.1	%		12.1	%

Selling, general and administrative expenses increased $5,417 or 92.2% during the three months ended June 30, 2016 as compared to the same prior year period primarily due to increases in headcount to reinforce the Company’s management team and higher professional fees, including legal, tax and accounting associated with our cross-border merger.

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							Six Months Ended
	Six Months Ended						Increase / (Decrease)
	June 30,						2016 vs. 2015
Selling, General and Administrative Expenses:	2016			2015			$		%
Selling, general and administrative expenses	$	20,751		$	10,336		$	10,415		100.8	%
Percentage of sales		27.6	%		12.7	%

Selling, general and administrative expenses increased $10,415 or 100.8% during the six months ended June 30, 2016 as compared to the same prior year period primarily due to increases in headcount to reinforce the Company’s management team and higher professional fees, including legal, tax and accounting associated with our cross-border merger.

Intangible Asset Amortization

							Three Months Ended
	Three Months Ended						Increase / (Decrease)
	June 30,						2016 vs. 2015
Intangibles Asset Amortization:	2016			2015			$		%
Intangible asset amortization	$	3,702		$	3,139		$	563		17.9	%
Percentage of sales		9.5	%		6.5	%

Intangible asset amortization expense increased $563 or 17.9% during the three months ended June 30, 2016 as compared to the same prior year period due to the commencement of amortization related to the acquired intangible assets of FSC.

							Six Months Ended
	Six Months Ended						Increase / (Decrease)
	June 30,						2016 vs. 2015
Intangibles Asset Amortization:	2016			2015			$		%
Intangible asset amortization	$	7,216		$	6,282		$	934		14.9	%
Percentage of sales		9.6	%		7.7	%

Intangible asset amortization expense increased $934 or 14.9% during the six months ended June 30, 2016 as compared to the same prior year period due to the commencement of amortization related to the acquired intangible assets of FSC.

Changes in Fair Value of Related Party Contingent Consideration

							Three Months Ended
	Three Months Ended						Increase / (Decrease)
	June 30,						2016 vs. 2015
Changes in Fair Value of Related Party Contingent Consideration:	2016			2015			$			%
Changes in fair value of related party contingent consideration	$	23,898		$	32,000		$	(8,102	)		(25.3	)%
Percentage of sales		61.5	%		65.8	%

Changes in fair value of related party contingent consideration decreased $8,102 or 25.3% during the three months ended June 30, 2016 as compared to the same prior year period primarily due to changes in the underlying assumptions of the long-term Éclat product forecasts associated with our acquisition-related long-term related party liabilities.

							Six Months Ended
	Six Months Ended						Increase / (Decrease)
	June 30,						2016 vs. 2015
Changes in Fair Value of Related Party Contingent Consideration:	2016			2015			$			%
Changes in fair value of related party contingent consideration	$	32,141		$	37,254		$	(5,113	)		(13.7	)%
Percentage of sales		42.8	%		45.9	%

Changes in fair value of related party contingent consideration decreased $5,113 or 13.7% during the six months ended June 30, 2016 as compared to the same prior year period primarily due to changes in the underlying assumptions of the long-term Éclat product forecasts associated with our acquisition-related long-term related party liabilities.

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Income Taxes

							Three Months Ended
	Three Months Ended						Increase / (Decrease)
	June 30,						2016 vs. 2015
Income Tax Provision:	2016			2015			$			%
Income tax provision	$	7,449		$	8,507		$	(1,058	)		(12.4	)%
Percentage of income (loss) before income taxes		(59.5	)%		(101.9	)%

The items accounting for the difference between the income tax provision computed at the French statutory rates and the Company's effective tax rate are as follows:

	Three Months Ended
	June 30,
	2016			2015
Statutory tax rate		33.3	%		33.3	%
International tax rates differential		(13.2	)%		(31.8	)%
Valuation allowance on net operating losses		(11.9	)%		(16.0	)%
Nondeductible contingent consideration		(64.2	)%		(132.3	)%
Nondeductible stock-based compensation		(1.7	)%		38.9	%
Deferred charge from IP transfer		-			(0.2	)%
State and local income taxes		(2.8	)%		(1.6	)%
Other		0.9	%		8.0	%
Effective income tax rate		(59.5	)%		(101.9	)%
Income tax provision - at Statutory tax rate	$	(4,165	)	$	(2,781	)
International tax rates differential		1,647			2,658
Valuation allowance on net operating losses		1,485			1,338
Nondeductible contingent consideration		8,029			11,049
Nondeductible stock-based compensation		216			(3,246	)
Deferred charge from IP transfer		(1	)		17
State and local income taxes		356			136
Other		(118	)		(664	)
Income tax provision - at Effective income tax rate	$	7,449		$	8,507

The income tax provision for the three months ended June 30, 2016 and 2015 was $7,449 and $8,507, respectively. The decrease in the income tax provision for the three months ended June 30, 2016 is primarily the result of decreases in the amount of pre-tax income recorded in the United States and France, when compared to the same period in 2015. The decrease in the income tax provision for the three months ended June 30, 2016 would have been larger, but a tax benefit from stock-based compensation recorded in the same period in 2015 did not repeat in 2016.

							Six Months Ended
	Six Months Ended						Increase / (Decrease)
	June 30,						2016 vs. 2015
Income Tax Provision:	2016			2015			$			%
Income tax provision	$	14,761		$	17,214		$	(2,453	)		(14.3	)%
Percentage of income (loss) before income taxes		(131.2	)%		126.9	%

- 28 -

The items accounting for the difference between the income tax provision computed at the French statutory rates and the Company's effective tax rate are as follows:

	Six Months Ended
	June 30,
	2016			2015
Statutory tax rate		33.3	%		33.3	%
International tax rates differential		(27.7	)%		27.6	%
Valuation allowance on net operating losses		(34.8	)%		2.4	%
Nondeductible contingent consideration		(96.0	)%		90.9	%
Nondeductible stock-based compensation		(3.9	)%		(26.4	)%
Deferred charge from IP transfer		(4.4	)%		0.5	%
State and local income taxes		(4.2	)%		1.9	%
Other		6.4	%		(3.4	)%
Effective income tax rate		(131.2	%)		126.9	%
Income tax provision - at Statutory tax rate	$	(3,748	)	$	4,518
International tax rates differential		3,115			3,748
Valuation allowance on net operating losses		3,913			332
Nondeductible contingent consideration		10,800			12,329
Nondeductible stock-based compensation		434			(3,579	)
Deferred charge from IP transfer		493			69
State and local income taxes		477			255
Other		(723	)		(458	)
Income tax provision - at Effective income tax rate	$	14,761		$	17,214

The income tax provision for the six months ended June 30, 2016 and 2015 was $14,761 and $17,214, respectively. The decrease in the income tax provision for the six months ended June 30, 2016 is primarily the result of decreases in the amount of pre-tax income recorded in the United States and France, when compared to the same period in 2015. The decrease in the income tax provision for the six months ended June 30, 2016 would have been larger, but a tax benefit from stock-based compensation recorded in the same period in 2015 did not repeat in 2016 and the Company was required to record a valuation allowance against the net operating losses generated in France in 2016.

- 29 -

Liquidity and Capital Resources

The Company's cash flows from operating, investing and financing activities, as reflected in the Condensed Consolidated Statements of Cash Flows, are summarized in the following table:

							Six Months Ended
	Six Months Ended						Increase / (Decrease)
	June 30,						2016 vs. 2015
Net cash provided by (used in):	2016			2015			$			%
Operating activities	$	15,921		$	39,301		$	(23,380	)		(59.5	)%
Investing activities		(50,114	)		(10,556	)		(39,558	)		(374.7	)%
Financing activities		(7,388	)		(10,872	)		3,484			32.0	%

Operating Activities

Net cash provided by operating activities of $15,921 for the six months ended June 30, 2016 decreased $23,380 compared to the same prior year period. This decline in operating cash flow is primarily due to lower cash earnings largely driven from lower revenues for the six months ended June 30, 2016 when compared to the same period last year. Additionally, contributing to the lower operating cash flows was a shift in the classification of earn-out payments for related party contingent consideration and royalty payments for related party payables from financing activities to operating activities. During the first half of 2016, the cumulative life-to-date payments of such related party payables reached and exceeded the original fair value of the related liabilities and as such the Company began classifying all payments in excess of these original fair values within operating activities. Payments in excess of the original fair value totaling $8,928 were classified within operating activities for the six months ended June 30, 2016, compared to the same period in 2015 during which all such cash payments were classified as financing activities.

Investing Activities

Cash used in investing activities of $50,114 for the six months ended June 30, 2016 increased $39,558 compared to the same prior year period. This increase was primarily driven by higher use of cash for net purchases of marketable securities of $44,435.

Financing Activities

Cash used in financing activities of $7,388 for the six months ended June 30, 2016 decreased $3,484 compared to the same prior year period. The decrease in cash used in financing activities during 2016 was driven primarily by the $4,903 debt payment in the first half of 2015. No such payment was made in 2016.

Liquidity and Risk Management

We believe that our existing cash and marketable securities balances and cash we expect to generate from operations will be sufficient to fund our operations and to meet our existing obligations for the foreseeable future. The adequacy of our cash resources depends on many assumptions, including primarily our assumptions with respect to product revenues and expenses, as well as the other factors set forth in “Risk Factors” within Part I, Item 1A of the Company’s 2015 Annual Report. To continue to grow our business, we will need to commit substantial resources, which could result in future losses or otherwise limit our opportunities or affect our ability to operate our business. Our assumptions may prove to be wrong or other factors may adversely affect our business, and as a result we could exhaust or significantly decrease our available cash and marketable securities balances which could, among other things, force us to raise additional funds and/or force us to reduce our expenses, either of which could have a material adverse effect on our business.

To continue to grow our business over the longer term, we plan to commit substantial resources to product development and clinical trials of product candidates. In this regard, we have evaluated and expect to continue to evaluate a variety of strategic transactions as part of our strategy to acquire or in-license and develop additional products and product candidates. Acquisition opportunities that we pursue could materially affect our liquidity and capital resources and may require us to incur indebtedness, seek equity capital or both. Raising additional capital could be accomplished through one or more public or private debt or equity financings, collaborations or partnering arrangements. Any equity financing would be dilutive to our shareholders.

- 30 -

Other Matters

Litigation

The Company is subject to potential liabilities generally incidental to its business arising out of present and future lawsuits and claims related to product liability, personal injury, contract, commercial, intellectual property, tax, employment, compliance and other matters that arise in the ordinary course of business. The Company accrues for potential liabilities when it is probable that future costs (including legal fees and expenses) will be incurred and such costs can be reasonably estimated. At June 30, 2016 and December 31, 2015, there were no contingent liabilities with respect to any threat of litigation, arbitration or administrative or other proceeding that are reasonably likely to have a material adverse effect on the Company’s condensed consolidated financial position, results of operations, cash flows or liquidity.

Material Commitments

Other than commitments to Recipharm and for operating leases as disclosed in Note 12 - Contingent Liabilities and Commitments to the Company's consolidated financial statements included in Part II, Item 8 of the Company’s 2015 Annual Report, there were no other material commitments outside of the normal course of business. Material commitments in the normal course of business include long-term debt, and post-retirement benefit plan obligations which are disclosed in Note 7 - Long-Term Debt and Note 10 – Post-Retirement Benefit Plans, respectively, to the Company's consolidated financial statements included in Part II, Item 8 of the Company’s 2015 Annual Report and long-term contingent consideration payable as disclosed in Note 7 – Long-term Related Party Payable, to the Company's condensed consolidated financial statements included in Part I, Item 1 of this report.

Contractual Obligations

Disclosures regarding contractual obligations are included in Part II, Item 7 of the Company’s 2015 Annual Report and updated in Note 7 – Long-term Contingent Consideration Payable to the Company's condensed consolidated financial statements included in Part I, Item 1 of this Report.

- 31 -

ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Interest Rate Risk

The Company is subject to interest rate risk as a result of its portfolio of marketable securities. The primary objectives of our investment policy are as follows: safety and preservation of principal and diversification of risk; liquidity of investments sufficient to meet cash flow requirements; and competitive yield. Although our investments are subject to market risk, our investment policy specifies credit quality standards for our investments and limits the amount of credit exposure from any single issue, issuer or certain types of investment. Our investment policy allows us to maintain a portfolio of cash equivalents and marketable securities in a variety of instruments, including U.S. federal government and federal agency securities, European Government bonds, corporate bonds or commercial paper issued by U.S. or European corporations, money market instruments, certain qualifying money market mutual funds, certain repurchase agreements, tax-exempt obligations of states, agencies, and municipalities in the U.S. and Europe, and common stocks.

Foreign Exchange Risk

We have significant operations in Europe as well as in the U.S. The functional currency of each of our foreign subsidiaries is generally the local currency. We are exposed to foreign currency exchange risk as the functional currency financial statements of foreign subsidiaries are translated to U.S. dollars. The assets and liabilities of our foreign subsidiaries having a functional currency other than the U.S. dollar are translated into U.S. dollars at the exchange rate prevailing at the balance sheet date, and at the average exchange rate for the reporting period for revenue and expense accounts. The cumulative foreign currency translation adjustment is recorded as a component of accumulated other comprehensive loss in shareholders’ equity. The reported results of our foreign subsidiaries will be influenced by their translation into U.S. dollars by currency movements against the U.S. dollar. Our primary currency translation exposure is related to our subsidiaries that have functional currencies denominated in Euro.

Transactional exposure arises where transactions occur in currencies other than the functional currency. Transactions in foreign currencies are recorded at the exchange rate prevailing at the date of the transaction. The resulting monetary assets and liabilities are translated into the appropriate functional currency at exchange rates prevailing at the balance sheet date and the resulting gains and losses are reported in foreign currency gain (loss) in the Condensed Consolidated Statements of Loss. As of June 30, 2016, our primary exposure to transaction risk related to U.S. dollar net monetary assets and liabilities held by subsidiaries with a Euro functional currency. Realized and unrealized foreign exchange gains of $1,680 and losses of $1,261 for the three and six months ended June 30, 2016, respectively, resulted from transactional exposure.

- 32 -

ITEM 4.     CONTROLS AND PROCEDURES.

Management of the Company, with the participation of its Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the Company’s disclosure controls and procedures as of June 30, 2016, the end of the period covered by this quarterly report on Form 10-Q.  The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (“Exchange Act”), means controls and other procedures of a company that are designed to provide reasonable assurance that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures are also designed to provide reasonable assurance that such information is accumulated and communicated to the Company’s management, including its Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.  Based on their evaluation, as of the end of the period covered by this Form 10-Q, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) were not effective because of the material weaknesses in our internal control over financial reporting as described in Item 9A in our Annual Report on Form 10-K as of December 31, 2015 .

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Exchange Act Rule 13a-15 or 15d-15 that occurred during the three months ended June 30, 2016 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting, except for the Company’s continued implementation of action plans to improve the effectiveness of our internal control over financial reporting and disclosure controls and procedures under the leadership of our Senior Vice President and Chief Financial Officer, who was hired in November 2015, with the assistance of our Chief Accounting Officer, who was hired in December 2015. While we have made progress in all areas of our remediation plan relating to the material weaknesses described in our Form 10-K as of December 31, 2015, we specifically focused on the revenue recognition process. In the area of revenue recognition, we assessed and enhanced the design and documentation of our revenue controls and developed a plan for testing their operating effectiveness. Further, we continue to add to our finance staff, implemented a new information technology system and designed more robust and effective general computer access controls and developed a plan for testing their operating effectiveness. Our Audit Committee contributes to establishing the appropriate tone at the top by emphasizing to senior leadership the importance of a sound internal control environment and also by approving our remediation plan and the subsequent monitoring of its progress.

- 33 -

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

The information contained in Note 14 – Commitments and Contingencies to the Company's condensed consolidated financial statements included in Part I, Item 1 of this Report is incorporated by reference herein.

ITEM 1A. RISK FACTORS.

There have been no material changes in our risk factors from those previously disclosed in the Company's 2015 Annual Report.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable.

- 34 -

ITEM 5. OTHER INFORMATION.

Revisions to Prior Period Financial Statements Resulting From Reclassifications and Corrections of Immaterial Errors

During the second quarter of 2016, the Company revised its consolidated financial statements for prior periods to reflect the impact of certain immaterial errors related to such periods, as well as for certain reclassifications to conform to the presentation used in 2016.

The Company has assessed the impact of these errors on its prior period financial statements included in our December 31, 2015 Annual Report on Form 10-K and concluded that the errors were not material to those financial statements.

Although the effect of the errors was not material to any previously issued financial statements, the cumulative effect of correcting the errors would have been material for the period ended June 30, 2016.

Consequently, the Company has presented the effects of these errors and reclassifications on its prior period financial statements in the tables below.  In future filings the financial statements for comparative periods affected by these errors and reclassifications will be revised.

The impact of the above errors and reclassifications on previously presented line items for each period included within the Company’s December 31, 2015 Annual Report on Form 10-K and March 31, 2016 Quarterly Report on Form 10-Q is as follows:

Consolidated Statements of Income (Loss)

	Three Months Ended
	March 31, 2016
	As			Correction of Immaterial Errors										As
	filed							(e)			(d)			revised
Cost of products and services sold	$	4,395		$	-	$	-				$	(489	)	$	3,906
Changes in fair value of related party contingent consideration		7,916			-		-		327			-			8,243
Total operating expenses		30,674			-		-		327			(489	)		30,512
Operating income (loss)		5,542			-		-		(327	)		489			5,704
Other Expense - changes in fair value of related party payable		(1,861	)		-		-		327			-			(1,534	)
Income (loss) before income taxes		765			-		-		-			489			1,254
Income tax provision (benefit)		7,141			-		-		-			171			7,312
Net Income (Loss)		(6,376	)		-		-		-			318			(6,058	)
Earnings (loss) per share - Basic	$	(0.15	)	$	-	$	-	$	-		$	-		$	(0.15	)
Earnings (loss) per share - Diluted	$	(0.15	)	$	-	$	-	$	-		$	-		$	(0.15	)

	Year Ended
	December 31, 2015
	As		Correction of Immaterial Errors											As
	filed		(a)			(b)		(c)			(d)			revised
Product sales and services	$	172,488	$	-		$	-	$	(200	)	$	-		$	172,288
Total revenue		173,209		-			-		(200	)		-			173,009
Cost of products and services sold		10,921		-			-		-			489			11,410
Total operating expenses		101,762		-			-		-			489			102,251
Operating income (loss)		71,447		-			-		(200	)		(489	)		70,758
Income (loss) before income taxes		78,394		-			-		(200	)		(489	)		77,705
Income tax provision (benefit)		37,735		(1,587	)		-		(70	)		(171	)		35,907
Net income (loss)		40,659		1,587			-		(130	)		(318	)		41,798
Net income (loss) per share - basic	$	1.00	$	0.04		$	-	$	-		$	(0.01	)	$	1.03
Net income (loss) per share - diluted	$	0.93	$	0.04		$	-	$	-		$	(0.01	)	$	0.96

- 35 -

	Year Ended
	December 31, 2014
	As			Correction of Immaterial Errors									As
	filed			(a)		(b)			(c)		(d)		revised
Product sales and services	$	11,993		$	-	$	-		$	200	$	-	$	12,193
Total revenue		14,775			-		-			200		-		14,975
Operating income (loss)		(93,857	)		-		-			200		-		(93,657	)
Income (loss) before income taxes		(90,331	)		-		-			200		-		(90,131	)
Income tax provision (benefit)		(1,407	)		-		693			70		-		(644	)
Net income (loss) from continuing operations		(88,924	)		-		(693	)		130		-		(89,487	)
Net income (loss)		(84,906	)		-		(693	)		130		-		(85,469	)
Net income (loss) per share - basic and diluted from continuing operations	$	(2.45	)	$	-	$	(0.02	)	$	-	$	-	$	(2.47	)
Net income (loss) per share - basic and diluted	$	(2.34	)	$	-	$	(0.02	)	$	-	$	-	$	(2.36	)

	Year ended
	December 31, 2013
	As			Correction of Immaterial Errors									As
	filed			(a)		(b)			(c)		(d)		revised
Income tax provision (benefit)	$	(11,244	)	$	-	$	(333	)	$	-	$	-	$	(11,577	)
Net income (loss) from continuing operations		(46,509	)		-		333			-		-		(46,176	)
Net income (loss)		(42,925	)		-		333			-		-		(42,592	)
Net income (loss) per share - basic and diluted from continuing operations	$	(1.83	)	$	-	$	0.02		$	-	$	-	$	(1.81	)
Net income (loss) per share - basic and diluted	$	(1.69	)	$	-	$	0.02		$	-	$	-	$	(1.67	)

Consolidated Balance Sheets

	March 31, 2016
	As			Correction of Immaterial Errors										Reclassifications					As
	filed			(a)			(c)		(d)		(f)			(g)			(h)		revised
Accounts receivable	$	4,865		$	-		$	-	$	-	$	-		$	536		$	-	$	5,401
Total current assets		180,474			-			-		-		-			536			-		181,010
Total assets		255,010			-			-		-		-			536			-		255,546
Current portion of long-term related party payable		28,403			-			-		-		(4,000	)		-			-		24,403
Accounts payable		17,674			-			-		-		-			(3,427	)		-		14,247
Accrued expenses		3,346			-			-		-		-			3,631			-		6,977
Income taxes		5,844			(227	)		-		-		-			-			-		5,617
Total current liabilities		60,943			(227	)		-		-		(4,000	)		204			-		56,920
Long-term related party payable, less current portion		102,656			-			-		-		4,000			-			-		106,656
Deferred taxes		3,507			(1,360	)		-		-		-			-			-		2,147
Other		2,495			-			-		-		-			332			-		2,827
Total liabilities		185,311			(1,587	)		-		-		-			536			-		184,260
Accumulated deficit		(286,169	)		1,587			-		-		-			-			-		(284,582	)
Total shareholders' equity		69,699			1,587			-		-		-			-			-		71,286
Total liabilities and shareholders' equity		255,010			-			-		-		-			536			-		255,546

- 36 -

	December 31, 2015
	As			Correction of Immaterial Errors											Reclassifications					As
	filed			(a)			(c)		(f)			(g)			(h)			(i)		revised
Accounts receivable	$	6,978		$	-		$	-	$	-		$	-		$	509		$	-	$	7,487
Inventories		4,155			-			-		(489	)		-			-			-		3,666
Prepaid expenses and other current assets		7,989			-			-		-			-			-			75		8,064
Total current assets		166,306			-			-		(489	)		-			509			75		166,401
Other		158			-			-		-			-			-			9		167
Total assets		214,977			-			-		(489	)		-			509			84		215,081
Current portion of long-term related party payable		28,614			-			-		-			(3,410	)		-			-		25,204
Accounts payable		10,565			-			-		-			-			(5,517	)		-		5,048
Accrued expenses		3,598			-			-		-			-			5,710			-		9,308
Income taxes		323			(227	)		-		(171	)		-			-			75		-
Total current liabilities		48,788			(227	)		-		(171	)		(3,410	)		193			75		45,248
Long-term related party payable, less current portion		94,079			-			-		-			3,410			-			-		97,489
Deferred taxes		1,351			(1,360	)		-		-			-			-			9		-
Other		2,210			-			-		-			-			316			-		2,526
Total liabilities		147,112			(1,587	)		-		(171	)		-			509			84		145,947
Accumulated deficit		(279,793	)		1,587			-		(318	)		-			-			-		(278,524	)
Total shareholders' equity		67,865			1,587			-		(318	)		-			-			-		69,134
Total liabilities and shareholders' equity		214,977			-			-		(489	)		-			509			84		215,081

	December 31, 2014
	As			Correction of Immaterial Errors									Reclassifications					As
	filed			(a)		(c)		(f)		(g)			(h)			(i)		revised
Accounts receivable	$	1,679		$	-	$	200	$	-	$	-		$	(23	)	$	-	$	1,856
Total current assets		112,322			-		200		-		-			(23	)		-		112,499
Total assets		174,205			-		200		-		-			(23	)		-		174,382
Current portion of long-term related party payable		39,892			-		-		-		(7,050	)		-			-		32,842
Accounts payable		8,024			-		-		-		-			(871	)		-		7,153
Accrued expenses		5,667			-		-		-		-			717			-		6,384
Income taxes		7,643			-		70		-		-			-			-		7,713
Total current liabilities		70,842			-		70		-		(7,050	)		(154	)		-		63,708
Long-term related party payable, less current portion		74,858			-		-		-		7,050			-			-		81,908
Other		2,333			-		-		-		-			131			-		2,464
Total liabilities		149,310			-		70		-		-			(23	)		-		149,357
Accumulated deficit		(320,452	)		-		130		-		-			-			-		(320,322	)
Total shareholders' equity		24,895			-		130		-		-			-			-		25,025
Total liabilities and shareholders' equity		174,205			-		200		-		-			(23	)		-		174,382

(a)	Reflects the cumulative 2015 correction of $1,587 of income tax benefits related to the deductibility of the U.S. Internal Revenue Code Section 483 imputed interest on contingent consideration liabilities which should have been recorded in prior periods ($866, $292, $863 and ($434) in the first, second, third and fourth quarters of 2015, respectively).
(b)	Reflects the correction of $2,606 of income tax benefits from stock-based compensation and certain other items which were originally recorded in the fourth quarter of 2015 but should have been recorded in prior periods ($360 in 2012, $333 in 2013, $(693) in 2014, and $830, $1,026 and $750 in the first, second and third quarters of 2015, respectively). As these items were originally corrected in the fourth quarter of 2015, no adjustment was required to correct the consolidated balance sheet at December 31, 2015.
(c)	Reflects the correction of a $200 overstatement of revenue in the first quarter of 2015 resulting from errors in certain estimates of ending inventory amounts at our wholesalers which were originally corrected in the first quarter of 2015 but should have been recorded in the fourth quarter of 2014.
(d)	Reflects the correction of a $489 error in the Company’s inventory obsolescence reserve accrual and expense which was originally recorded in the first quarter of 2016 but should have been recorded in the fourth quarter of 2015.
(e)	Reflects the correction of a $327 classification error where the change in fair value of related party contingent consideration for FSC should have been classified within Operating expenses rather than within Other expenses during the first quarter of 2016.

- 37 -

(f)	Reflects the correction of a balance sheet classification error which overstated the current portion of the long-term related party payable by $4,000, $3,410 and $7,050 at March 31, 2016 and December 31, 2015 and 2014, respectively.
(g)	Reflects revisions to the presentation of certain gross to net revenue reserves which were previously included in accounts payable and are now included in accrued expenses.
(h)	Reflects balance sheet reclassifications required to properly net the accrued income tax and deferred income tax amounts within the balance sheet as a result of the adjustments made in items (a) through (g) above.

In addition to the specific amounts identified within the tables above, the Company also changed the names of the previously-reported “Interest expense – changes in fair value of related party financing related contingent consideration” line on the condensed consolidated statement of income (loss) to “Other expense – changes in fair value of related party payable”, and the previously-reported “Long-term related party contingent consideration payable” line on the condensed consolidated balance sheet to “Long-term related party payable” to better reflect the underlying nature of certain royalty agreements in prior periods. These arrangements should have been evaluated under ASC 470 and included as a related party payable rather than as contingent consideration, with the related expense classified as “Other expense” rather than “Interest expense”.

While the balance sheet revisions and reclassifications noted in the tables above impact their corresponding captions within the cash flows provided by (used in) operating activities section of the Company’s consolidated statements of cash flows in each period of 2015, 2014 and 2013, there was no impact to the total net cash provided by (used in) operating activities in any of these periods. For the first quarter of 2016, an immaterial classification error was identified within the condensed consolidated statement of cash flows where $2,126 of cash payments for long-term related party payables were understated within cash flows provided by (used in) operating activities and overstated within cash flows provided by (used in) financing activities.

- 38 -

ITEM 6.    EXHIBITS.

Exhibit No.	Description
31.1*	Certification of the Principal Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) promulgated under the Exchange Act.
31.2*	Certification of the Principal Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) promulgated under the Exchange Act.
32.1**	Certification of the Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2**	Certification of the Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*	XBRL Instance Document
101.SCH*	XBRL Taxonomy Extension Schema Document
101.CAL*	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*	XBRL Taxonomy Extension Label Linkbase Document
101.PRE*	XBRL Taxonomy Extension Presentation Linkbase Document

______________________

*      Filed herewith.

**      Furnished herewith.

- 39 -

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	FLAMEL TECHNOLOGIES S.A. (Registrant)
Date: August 15, 2016	By:	/s/ Michael F. Kanan
		Michael F. Kanan
		Senior Vice President and Chief Financial Officer
		(Duly Authorized Officer and Principal Financial Officer)

- 40 -

EX-31.1

 Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Michael S. Anderson, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Flamel Technologies S.A.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 15, 2016	/s/ Michael S. Anderson
	Michael S. Anderson
	Chief Executive Officer (Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Michael F. Kanan, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Flamel Technologies S.A.:

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 15, 2016	/s/ Michael F. Kanan
	Michael F. Kanan
	Senior Vice President and Chief Financial Officer (Principal Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Flamel Technologies S.A. (the “Company”) for the period ended June 30, 2016 (the “Report”), the undersigned hereby certifies in his capacity as Chief Executive Officer of the Company pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of his knowledge:

1.           the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2.           the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 15, 2016	/s/ Michael S. Anderson
	Michael S. Anderson
	Chief Executive Officer (Principal Executive Officer)

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Flamel Technologies S.A. (the “Company”) for the period ended June 30, 2016 (the “Report”), the undersigned hereby certifies in his capacity as Chief Financial Officer of the Company pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of his knowledge:

1.           the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2.           the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 15, 2016	/s/ Michael F. Kanan
	Michael F. Kanan
	Senior Vice President and Chief Financial Officer (Principal Financial Officer)

XML

Document And Entity Information - shares	6 Months Ended
	Jun. 30, 2016	Aug. 03, 2016
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2016
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	Q2
Entity Registrant Name	FLAMEL TECHNOLOGIES SA
Entity Central Index Key	0001012477
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Trading Symbol	FLML
Entity Common Stock, Shares Outstanding		41,241,254

XML

CONDENSED CONSOLIDATED STATEMENTS OF LOSS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Revenues:
Product sales and services	$ 38,165	$ 48,602	$ 73,518	$ 81,128
License and research revenue	693	0	1,556	0
Total	38,858	48,602	75,074	81,128
Operating expenses:
Cost of products and services sold (excluding intangible asset amortization below)	3,907	2,756	7,813	6,386
Research and development expenses	7,604	7,204	12,992	13,226
Selling, general and administrative expenses	11,290	5,873	20,751	10,336
Intangible asset amortization	3,702	3,139	7,216	6,282
Changes in fair value of related party contingent consideration	23,898	32,000	32,141	37,254
Total	50,401	50,972	80,913	73,484
Operating income (loss)	(11,543)	(2,370)	(5,839)	7,644
Investment income, net	390	310	590	974
Interest expense, net	(263)	0	(438)	0
Other expense - changes in fair value of related party payable	(2,773)	(2,726)	(4,307)	(2,985)
Foreign exchange gain (loss)	1,680	(3,565)	(1,261)	7,936
Income (loss) before income taxes	(12,509)	(8,351)	(11,255)	13,569
Income tax provision	7,449	8,507	14,761	17,214
Net loss	$ (19,958)	$ (16,858)	$ (26,016)	$ (3,645)
Earnings (loss) per share
Net loss per share - basic	$ (0.48)	$ (0.42)	$ (0.63)	$ (0.09)
Net loss per share - diluted	$ (0.48)	$ (0.42)	$ (0.63)	$ (0.09)
Weighted average number of shares outstanding - basic	41,241	40,353	41,241	40,281
Weighted average number of shares outstanding - diluted	41,241	40,353	41,241	40,281

XML

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Net loss	$ (19,958)	$ (16,858)	$ (26,016)	$ (3,645)
Other comprehensive income (loss), net of tax:
Foreign currency translation gain (loss)	(2,457)	5,262	2,360	(11,387)
Unrealized gain (loss) on marketable securities, net of ($73), $0, ($158), $0 tax	528	(356)	1,447	0
Total other comprehensive income (loss), net of tax	(1,929)	4,906	3,807	(11,387)
Total comprehensive loss	$ (21,887)	$ (11,952)	$ (22,209)	$ (15,032)

XML

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS [Parenthetical] - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Other Comprehensive Income (Loss), Unrealized Holding Gain (Loss) on Securities Arising During Period, Tax	$ (73)	$ 0	$ (158)	$ 0

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Current assets:
Cash and cash equivalents	$ 23,899	$ 65,064
Marketable securities	130,964	79,738
Accounts receivable (net of allowance of $35 at both June 30, 2016 and December 31, 2015)	9,488	7,487
Inventories	3,640	3,666
Research and development tax credit receivable	0	2,382
Prepaid expenses and other current assets	9,657	8,064
Total current assets	177,648	166,401
Property and equipment, net	3,104	2,616
Goodwill	18,669	18,491
Intangible assets, net	29,209	15,825
Research and development tax credit receivable	4,034	0
Income tax deferred charge	11,381	11,581
Other	5,661	167
Total assets	249,706	215,081
Current liabilities:
Current portion of long-term debt	283	434
Current portion of long-term related party payable	29,500	25,204
Accounts payable	7,043	5,048
Deferred revenue	3,820	5,121
Accrued expenses	10,592	9,308
Income taxes	6,286	0
Other	664	133
Total current liabilities	58,188	45,248
Long-term debt, less current portion	788	684
Long-term related party payable, less current portion	136,021	97,489
Other	2,871	2,526
Total liabilities	197,868	145,947
Shareholders' equity:
Ordinary shares, nominal value of 0.122 euro per share; 53,178 shares authorized; 41,241 issued and outstanding at June 30, 2016 and December 31, 2015	6,331	6,331
Additional paid-in capital	368,897	363,984
Accumulated deficit	(304,540)	(278,524)
Accumulated other comprehensive loss	(18,850)	(22,657)
Total shareholders' equity	51,838	69,134
Total liabilities and shareholders' equity	$ 249,706	$ 215,081

XML

CONDENSED CONSOLIDATED BALANCE SHEETS [Parenthetical] shares in Thousands, $ in Thousands	Jun. 30, 2016 USD ($) shares	Jun. 30, 2016 € / shares	Dec. 31, 2015 USD ($) shares	Dec. 31, 2015 € / shares
Allowance for accounts receivable (in dollars) | $	$ 35		$ 35
Common stock, par value (in euro per share) | € / shares		€ 0.122		€ 0.122
Common stock, shares authorized	53,178		53,178
Common stock, shares issued	41,241		41,241
Common stock, shares outstanding	41,241		41,241

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Cash flows from operating activities:
Net loss	$ (26,016)	$ (3,645)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	7,681	6,531
Loss on disposal of property and equipment	110	0
Loss on sale of marketable securities	455	225
Unrealized exchange loss (gain)	1,261	(7,315)
Grants recognized in research and development expenses and operating income	(70)	(1,086)
Remeasurement of related party acquisition-related contingent consideration	32,141	37,254
Remeasurement of related party financing-related contingent consideration	4,307	2,985
Change in deferred tax and income tax deferred charge	(5,028)	3,442
Stock-based compensation expense	4,913	4,152
Increase (decrease) in cash from:
Accounts receivable	(1,689)	467
Inventories	2,345	1,175
Prepaid expenses and other current assets	546	(1,876)
Research and development tax credit receivable	(1,630)	3,807
Accounts payable & other current liabilities	(348)	2,194
Deferred revenue	(1,461)	(1,314)
Accrued expenses	777	(614)
Accrued income taxes	6,285	(7,636)
Earn-out payments for related party contingent consideration in excess of acquisition-date fair value	(7,769)	0
Royalty payments for related party payable in excess of original fair value	(1,159)	0
Other long-term assets and liabilities	270	555
Net cash provided by operating activities	15,921	39,301
Cash flows from investing activities:
Purchases of property and equipment	(760)	(659)
Acquisitions of businesses	161	0
Proceeds from sales of marketable securities	26,013	21,196
Purchase of marketable securities	(75,528)	(31,093)
Net cash used in investing activities	(50,114)	(10,556)
Cash flows from financing activities:
Earn-out payments for related party contingent consideration	(6,572)	(6,118)
Royalty payments for related party payable	(816)	(888)
Repayment of debt	0	(4,903)
Reimbursement of conditional grants	0	(615)
Cash proceeds from issuance of ordinary shares and warrants	0	1,652
Net cash used in financing activities	(7,388)	(10,872)
Effect of exchange rate changes on cash and cash equivalents	416	(2,397)
Net increase (decrease) in cash and cash equivalents	(41,165)	15,476
Cash and cash equivalents at January 1	65,064	39,760
Cash and cash equivalents at June 30	$ 23,899	$ 55,236

XML

Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2016

Accounting Policies [Abstract]

Significant Accounting Policies [Text Block]

NOTE 1 : Summary of Significant Accounting Policies

Nature of Operations. Flamel Technologies S.A. (“Flamel,” the “Company,” “we” or “us”) is organized as a Société Anonyme, a form of corporation under the laws of The Republic of France. The Company was founded in 1990. Flamel is a specialty pharmaceutical company utilizing core competencies in drug delivery and formulation development to create safer and more efficacious pharmaceutical products to address unmet medical needs and/or reduce overall healthcare costs. The Company has a business model consisting of:

⋅ an Unapproved Marketed Drugs (“UMDs”) business with two approved products in the United States, Bloxiverz^® (neostigmine methylsulfate injection) and Vazculep^® (phenylephrine hydrochloride injection) that are currently marketed, a third product, Akovaz® (ephedrine sulphate injection) for which we obtained FDA approval on April 29, 2016 and which we intend to begin marketing in the third quarter of 2016, and a fourth product currently being studied by us for possible submission for review by the FDA. The UMD business was obtained through the acquisition of Éclat Pharmaceuticals, LLC’s (or “Éclat”) on March 13, 2012,

⋅ a branded pediatric specialty pharmaceutical business, with three FDA approved products and one FDA approved medical device, acquired through the acquisition of FSC Laboratories and FSC Pediatrics (“FSC”) on February 5, 2016; and

⋅ a branded business, focusing on the development of products utilizing Flamel’s proprietary drug delivery platforms. The branded products that are based on Flamel’s proprietary drug delivery platforms target high-value solid and liquid oral and alternative dosage forms using 505(b)(2) and Biosimilar pathways where the Company is able to develop strong intellectual property positions and deliver meaningful patient benefits.

Flamel is headquartered in Lyon, France and has operations in St. Louis, Missouri, United States, and Dublin, Ireland.

Proposed Reincorporation as an Irish Public Limited Company (plc).  At our shareholders meeting on August 10, 2016, our shareholders approved resolutions to change our jurisdiction of incorporation from France to Ireland.  Based on such approval, we intend to give effect to this reincorporation on December 31, 2016 by merging with and into our wholly owned Irish corporate subsidiary, Avadel Pharmaceuticals Limited (the “Merger”).  Prior to completing the Merger, Avadel Pharmaceuticals Limited will re-register as an Irish public limited company, or plc, and at the time of the Merger and thereafter our shareholders (and holders of our American Depositary Shares (ADSs)) will own shares (or ADSs, as applicable) in a company known as Avadel Pharmaceuticals plc.  Our definitive proxy statement filed with the Securities and Exchange Commission on July 5, 2016 contains additional information about the proposed reincorporation.

Basis of Presentation. The Condensed Consolidated Balance Sheet as of December 31, 2015, which is derived from the prior year 2015 audited consolidated financial statements, and the interim unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (U.S. GAAP), the requirements of Form 10-Q and Article 10 of Regulation S-X and, consequently, do not include all information or footnotes required by U.S. GAAP for complete financial statements or all the disclosures normally made in an annual report on Form 10-K. Accordingly, the unaudited condensed consolidated financial statements included herein should be read in conjunction with the audited consolidated financial statements and footnotes included in the Company’s 2015 Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 15, 2016.

The unaudited condensed consolidated financial statements include the accounts of the Company, and reflect all adjustments (consisting only of normal recurring adjustments) that are, in the opinion of management, necessary for a fair presentation of the Company’s financial position, results of operations and cash flows for the dates and periods presented. All intercompany accounts and transactions have been eliminated. Results for interim periods are not necessarily indicative of the results to be expected during the remainder of the current year or for any future period.

Foreign Currency Translation. The reporting currency of the Company and its wholly-owned subsidiaries is the U.S. dollar. Each of the Company's non-U.S. subsidiaries and the parent entity uses local currency as their functional currency. Subsidiaries and entities that do not use the U.S. dollar as their functional currency translate 1) profit and loss accounts at the weighted average exchange rates during the reporting period, 2) assets and liabilities at period end exchange rates and 3) shareholders' equity accounts at historical rates. Resulting translation gains and losses are included as a separate component of shareholders' equity in Accumulated Other Comprehensive Loss. Assets and liabilities denominated in a currency other than the subsidiary's functional currency are translated to the subsidiary's functional currency at period end exchange rates. Resulting gains and losses are recognized in the Condensed Consolidated Statements of Loss.

Reclassifications and Immaterial Corrections of Prior Period Amounts. The accompanying condensed consolidated financial statements for prior periods contain certain reclassifications to conform to the presentation used in 2016. Additionally, the Company has identified certain immaterial errors related to prior reporting periods. The Company has assessed the impact of the errors on its prior period financial statements included in our December 31, 2015 Annual Report on Form 10-K and concluded that the errors were not material to those financial statements.

Although the effect of the errors was not material to any previously issued financial statements, the cumulative effect of correcting the errors would have been material for the period ended June 30, 2016.

Consequently, the Company has presented the effects of these errors and reclassifications on its prior period financial statements in the tables below. In future filings the financial statements for comparative periods affected by these errors and reclassifications will be revised.

The impact of the above errors and reclassifications on previously presented line items for each comparative period presented is as follows:

	Three Months Ended
	June 30, 2015
				Correction of Immaterial Errors
Consolidated Statement of Loss:	As filed			(a)			(b)			(c)			As revised
Product sales and services	$	49,795		$	-		$	-		$	(1,193	)	$	48,602
Total revenue		49,795			-			-			(1,193	)		48,602
Operating income (loss)		(1,177	)		-			-			(1,193	)		(2,370	)
Income (loss) before income taxes		(7,158	)		-			-			(1,193	)		(8,351	)
Income tax provision		10,242			(292	)		(1,026	)		(417	)		8,507
Net loss		(17,400	)		292			1,026			(776	)		(16,858	)
Net loss per share - basic	$	(0.43	)	$	0.01		$	0.02		$	(0.02	)	$	(0.42	)
Net loss per share - diluted	$	(0.43	)	$	0.01		$	0.02		$	(0.02	)	$	(0.42	)

	Six Months Ended
	June 30, 2015
				Correction of Immaterial Errors
Consolidated Statement of Loss:	As filed			(a)			(b)			(c)			(d)			As revised
Product sales and services	$	82,521		$	-		$	-		$	(1,193	)	$	(200	)	$	81,128
Total revenue		82,521			-			-			(1,193	)		(200	)		81,128
Operating income (loss)		9,037			-			-			(1,193	)		(200	)		7,644
Income (loss) before income taxes		14,962			-			-			(1,193	)		(200	)		13,569
Income tax provision		20,715			(1,158	)		(1,856	)		(417	)		(70	)		17,214
Net loss		(5,753	)		1,158			1,856			(776	)		(130	)		(3,645	)
Net loss per share - basic	$	(0.14	)	$	0.03		$	0.04		$	(0.02	)	$	-		$	(0.09	)
Net loss per share - diluted	$	(0.14	)	$	0.03		$	0.04		$	(0.02	)	$	-		$	(0.09	)

	December 31, 2015
				Correction of Immaterial Errors									Reclassifications
Consolidated Balance Sheet:	As filed			(a)			(e)			(f)			(g)			(h)		As revised
Accounts receivable	$	6,978		$	-		$	-		$	-		$	509		$	-	$	7,487
Inventories		4,155			-			(489	)		-			-			-		3,666
Prepaid expenses and other current assets		7,989			-			-			-			-			75		8,064
Total current assets		166,306			-			(489	)		-			509			75		166,401
Other		158			-			-			-			-			9		167
Total assets		214,977			-			(489	)		-			509			84		215,081
Current portion of long-term related party payable		28,614			-			-			(3,410	)		-			-		25,204
Accounts payable		10,565			-			-			-			(5,517	)		-		5,048
Accrued expenses		3,598			-			-			-			5,710			-		9,308
Income taxes		323			(227	)		(171	)		-			-			75		-
Total current liabilities		48,788			(227	)		(171	)		(3,410	)		193			75		45,248
Long-term related party payable, less current portion		94,079			-			-			3,410			-			-		97,489
Deferred taxes		1,351			(1,360	)		-			-			-			9		-
Other		2,210			-			-			-			316			-		2,526
Total liabilities		147,112			(1,587	)		(171	)		-			509			84		145,947
Accumulated deficit		(279,793	)		1,587			(318	)		-			-			-		(278,524	)
Total shareholders' equity		67,865			1,587			(318	)		-			-			-		69,134
Total liabilities and shareholders' equity		214,977			-			(489	)		-			509			84		215,081

(a)	Reflects the cumulative 2015 correction of $1,587 of income tax benefits related to the deductibility of the U.S. Internal Revenue Code Section 483 imputed interest on contingent consideration liabilities which should have been recorded in prior periods ($866, $292, $863 and ($434) in the first, second, third and fourth quarters of 2015, respectively).
(b)	Reflects the correction of $2,606 of income tax benefits from stock-based compensation and certain other items which were originally recorded in the fourth quarter of 2015 but should have been recorded in prior periods ($360 in 2012, $333 in 2013, $(693) in 2014, and $830, $1,026 and $750 in the first, second and third quarters of 2015, respectively). As these items were originally corrected in the fourth quarter of 2015, no adjustment was required to correct the consolidated balance sheet at December 31, 2015.
(c)	Reflects the correction of a $200 overstatement of revenue in the first quarter of 2015 resulting from errors in certain estimates of ending inventory amounts at our wholesalers which were originally corrected in the first quarter of 2015 but should have been recorded in the fourth quarter of 2014.
(d)	Reflects the correction of a $1,193 understatement in the second quarter of 2015 of the gross to net revenue reserves with respect to estimates for product returns as a result of improper reconciliation to revenue data communicated by service providers. As this item was originally corrected in the third quarter of 2015, no adjustment was required to correct the consolidated balance sheet at December 31, 2015.
(e)	Reflects the correction of a $489 error in the Company’s inventory obsolescence reserve accrual and expense which was originally recorded in the first quarter of 2016 but should have been recorded in the fourth quarter of 2015.
(f)	Reflects the correction of a balance sheet classification error which overstated the current portion of the long-term related party payable by $3,410.
(g)	Reflects revisions to the presentation of certain gross to net revenue reserves which were previously included in accounts payable and are now included in accrued expenses.
(h)	Reflects balance sheet reclassifications required to properly net the accrued income tax and deferred income tax amounts within the balance sheet as a result of the adjustments made in items (a) through (g) above.

In addition to the specific amounts identified within the tables above, the Company also changed the names of the previously-reported “Interest expense – changes in fair value of related party financing related contingent consideration” line on the condensed consolidated statement of income (loss) to “Other expense – changes in fair value of related party payable”, and the previously-reported “Long-term related party contingent consideration payable” line on the condensed consolidated balance sheet to “Long-term related party payable” to better reflect the underlying nature of certain royalty agreements in prior periods.

While the balance sheet revisions and reclassifications noted in the tables above impact their corresponding captions within the cash flows provided by (used in) operating activities section of the Company’s consolidated statements of cash flows in each period of 2015, there was no impact to the total net cash provided by (used in) operating activities in any of these periods.

Revenue. Revenue includes sales of pharmaceutical products, amortization of licensing fees, milestone payments for R&D achievements, and compensation for the execution of R&D activities.

Product Sales and Services

Revenue is generally realized or realizable and earned when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the seller’s price to the buyer is fixed or determinable, and collectability is reasonably assured. The Company records revenue from product sales when title and risk of ownership have been transferred to the customer, which is typically upon delivery to the customer and when the selling price is determinable. As is customary in the pharmaceutical industry, the Company’s gross product sales are subject to a variety of deductions in arriving at reported net product sales. These adjustments include estimates for product returns, chargebacks, payment discounts, rebates, and other sales allowances and are estimated based on analysis of historical data for the product or comparable products, as well as future expectations for such products.

For generic products and branded products sold in mature markets where the ultimate net selling price to customer is estimable, the Company recognizes revenues upon shipment to the wholesaler. For new product launches the Company recognizes revenue once sufficient data is available to determine product acceptance in the marketplace such that product returns may be estimated based on historical data and there is evidence of reorders and consideration is made of wholesaler inventory levels.

Prior to the second quarter 2016, the Company did not have sufficient historical data to estimate certain revenue deductions. As such, it could not accurately estimate the ultimate net selling price of its Éclat portfolio of products and as a result delayed revenue recognition until the wholesaler sold the product through to its customers.

During the second quarter of 2016, the Company determined that it has sufficient evidence, history, data and internal controls to estimate the ultimate selling price of its products upon shipment from its warehouse to its customers, the wholesalers.  Accordingly, it discontinued the sell through revenue approach and now recognizes revenue once the product is shipped from its warehouse. As a result of this change in accounting estimate, the Company recognized $5,981 in additional revenue, or $0.05 in additional diluted net earnings (loss) per share, for the three and six months ended June 30, 2016 that previously would have been deferred until sold by the wholesalers to the hospitals. 

License and Research Revenue

The Company’s license and research revenues consist of fees and milestone payments. Non-refundable fees where we have continuing performance obligations are deferred and are recognized ratably over our projected performance period. We recognize milestone payments, which are typically related to regulatory, commercial or other achievements by us or our licensees and distributors, as revenues when the milestone is accomplished and collection is reasonably assured.

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Newly Issued Accounting Pronouncements

6 Months Ended

Jun. 30, 2016

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

New Accounting Pronouncements and Changes in Accounting Principles [Text Block]

NOTE 2 : Newly Issued Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09 “Revenue from Contracts with Customers” which supersedes the most current revenue recognition requirements. This ASU requires entities to recognize revenue in a way that depicts the transfer of goods or services to customers in an amount that reflects the consideration which the entity expects to be entitled to in exchange for those goods or services. Through May 2016, the FASB issued ASU 2016-08 “Principal versus Agent Considerations (Reporting Revenue Gross versus Net),” ASU 2016-10 “Identifying Performance Obligations and Licensing,” and ASU 2016-12, “Narrow-Scope Improvements and Practical Expedients,” which provide supplemental adoption guidance and clarification to ASU 2014-09, respectively. These ASUs will be effective for annual and interim periods beginning after December 15, 2017 with early adoption for annual and interim periods beginning after December 15, 2016 permitted and should be applied retrospectively to each prior reporting period presented or as a cumulative effect adjustment as of the date of adoption. The Company is currently evaluating this pronouncement to determine the impact of its adoption on its condensed consolidated financial statements.

In March 2016, the FASB issued ASU 2016-09 “Improvements to Employee Share-Based Payment Accounting” which amends Accounting Standards Codification (“ASC”) Topic 718 “Compensation – Stock Compensation”. This update simplifies several aspects of accounting for share-based payment awards to employees, including the accounting for income taxes, classification of awards as either equity or liabilities and classification in the statement of cash flows. The standard is effective for annual reporting periods beginning after December 15, 2016. The Company does not believe this standard will materially impact its condensed consolidated financial statements.

In February 2016, the FASB issued ASU 2016-02 “Leases” which supersedes ASC 840 “Leases” and creates a new topic, ASC 842 “Leases.” This update requires lessees to recognize on their balance sheet a lease liability and a lease asset for all leases, including operating leases, with a term greater than 12 months. The update also expands the required quantitative and qualitative disclosures surrounding leases. This update is effective for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years, with earlier application permitted. This update will be applied using a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The Company is currently evaluating the effect of this update on its condensed consolidated financial statements.

In September 2015, the FASB issued ASU 2015-16 “Business Combinations” which requires that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. This ASU is effective for interim and annual reporting periods beginning after December 15, 2016, with the option to early adopt for financial statements that have not been issued. The Company early adopted the provisions of ASU 2015-16 for the year ended December 31, 2015 on a prospective basis.

In July 2015, the FASB issued ASU 2015-11 “Simplifying the Measurement of Inventory”, which requires an entity to measure inventory within the scope of this ASU at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The effective date for the standard is for fiscal years beginning after December 15, 2016, which for the Company is January 1, 2017. Early adoption is permitted. The new standard is to be applied prospectively. The Company does not expect ASU 2015-11 to have a material impact on its condensed consolidated financial statements.

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Marketable Securities

6 Months Ended

Jun. 30, 2016

Investments, Debt and Equity Securities [Abstract]

Cash Cash Equivalents And Marketable Securities [Text Block]

NOTE 3 : Marketable Securities

The Company has investments in available-for-sale marketable equity securities which are recorded at fair market value and measured using quoted prices in their respective active market, thus representing a level 1 fair value measurement as defined in ASC 820. Unrealized gains and losses are recorded as other comprehensive income (loss) in shareholders’ equity, net of income tax effects.

The value at cost, gross unrealized holding gains or losses, and fair value of the Company’s available-for-sale marketable securities are summarized below as of:

	June 30,		December 31,
Marketable Securities:	2016		2015
Value at cost	$	131,041	$	81,395
Gross unrealized holding gains		1,236		15
Gross unrealized holding losses		(1,313)		(1,672)
Fair value	$	130,964	$	79,738

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Inventories

6 Months Ended

Jun. 30, 2016

Inventory Disclosure [Abstract]

Inventory Disclosure [Text Block]

NOTE 4 : Inventories

The principal categories of inventories at June 30, 2016 and December 31, 2015 are as follows:  

	June 30,		December 31,
Inventory:	2016		2015
Finished Goods	$	3,280	$	2,545
Raw Materials		360		1,121
Total	$	3,640	$	3,666

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Acquisitions

6 Months Ended

Jun. 30, 2016

Business Combinations [Abstract]

Business Combination Disclosure [Text Block]

NOTE 5 : Acquisitions

On February 5, 2016, the Company completed its acquisition of FSC Holdings, LLC (“FSC”), a Charlotte, North Carolina-based specialty pharmaceutical company dedicated to providing innovative solutions to unmet medical needs for pediatric patients, from Deerfield CSF, LLC, a Deerfield Management company (“Deerfield”), a related party.

This acquisition has been accounted for using the acquisition method of accounting and, accordingly, its results are included in the Company's condensed consolidated financial statements from the date of acquisition. Total consideration to acquire FSC is estimated to be $22,228, and was funded with a combination of the following, partially offset by $467 as a result of a net working capital settlement due from the seller:

⋅ $15,000 long-term liability to Deerfield. Under the terms of the acquisition agreement, the Company will pay $1,050 annually for five years with a final payment in January 2021 of $15,000.

⋅ $7,695 contingent consideration to Deerfield. Under the terms of the acquisition agreement, the Company shall pay quarterly a 15% royalty on the net sales of certain FSC products, up to $12,500 for a period not exceeding ten years.

 

The present value of these estimated discounted future cash flows for each of these items is reported in related party payable within the Company’s Condensed Consolidated Balance Sheet, and is further disclosed at Note 7 – Long-Term Related Party Payable.

During the first half  of 2016, the Company determined its preliminary accounting for the FSC acquisition. As the Company completes its final accounting for the acquisition, future adjustments related to working capital, amortizable intangible assets, goodwill and deferred taxes could occur. The preliminary fair values assigned to the acquired assets and liabilities have been recognized as follows:

Assigned Fair Value:	2016 Preliminary
Accounts receivable	$	825
Inventories		2,315
Prepaid expenses and other current assets		1,712
Goodwill		178
Intangible assets:
Acquired product marketing rights		16,200
Acquired developed technology		4,400
Other assets		392
Accounts payable and other current liabilities		(3,794)
Total	$	22,228

Goodwill resulting from the acquisition is largely attributable to the existing workforce of FSC, and is not expected to be deductible for tax purposes. Transaction expenses for legal and professional fees associated with the acquisition of FSC amounted to $76 during the three and six month period ended June 30, 2016 and are reported within the Selling, general and administrative expenses line in the Condensed Consolidated Statements of Loss. The useful lives on FSC acquired intangible assets range from seven to ten years.

After its acquisition on February 5, 2016, FSC contributed $1,761 and $2,637 to the Company's net sales for the three and six month periods ended June 30, 2016, respectively. Concurrently, the net impact of the FSC acquisition was a loss of  $3,096 and $4,489 for the three and six month periods ended June 30, 2016, respectively.

Had the FSC acquisition been completed as of the beginning of 2015, the Company's unaudited pro forma net sales and net loss for the six months ended June 30, 2016 and 2015 would have been as follows:

 

	Six Months Ended
Pro Forma Net Revenue and Losses	June 30, 2016		June 30, 2015
Net revenues	$	75,549	$	83,579
Net loss		(27,030)		(9,395)

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Goodwill and Intangible Assets

6 Months Ended

Jun. 30, 2016

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets Disclosure [Text Block]

NOTE 6 : Goodwill and Intangible Assets

The Company's amortizable and unamortizable intangible assets at June 30, 2016 and December 31, 2015 are as follows:

	June 30, 2016						December 31, 2015
	Gross Value		Accumulated Amortization		Net Carrying Amount		Gross Value		Accumulated Amortization		Net Carrying Amount
Amortizable intangible assets:
Acquired developed technology - Bloxiverz	$	35,248	$	(29,373)	$	5,875	$	35,248	$	(23,498)	$	11,750
Acquired developed technology - Vazculep		12,061		(8,394)		3,667		12,061		(7,986)		4,075
Acquired developed technology - Flexichamber		4,400		(183)		4,217		-		-		-
Acquired product marketing rights		16,200		(750)		15,450		-		-		-
Total amortizable intangible assets	$	67,909	$	(38,700)	$	29,209	$	47,309	$	(31,484)	$	15,825
Unamortizable intangible assets:
Goodwill	$	18,669	$	-	$	18,669	$	18,491	$	-	$	18,491
Total unamortizable intangible assets	$	18,669	$	-	$	18,669	$	18,491	$	-	$	18,491

The Company recorded amortization expense related to amortizable intangible assets of $3,702 and $3,139 for the three months ended June 30, 2016 and 2015, respectively. The Company recorded amortization expense related to amortizable intangible assets of $7,216 and $6,282 for the six months ended June 30, 2016 and 2015, respectively. Accumulated amortization in the above tables includes an impairment charge of $7,171 which was recognized during the year ended December 31, 2012 relative to the “Acquired developed technology – Vazculep” intangible asset.

Amortizable intangible assets are amortized over their estimated useful lives, which range from three to ten years. Estimated amortization of intangible assets for the next five years is as follows:

Years ending December 31,	Estimated Amortization Expense
2016	$	14,616
2017		3,056
2018		3,056
2019		3,056
2020		3,056
Total	$	26,840

The change in net goodwill during the six months ended June 30, 2016 is as follows:

Goodwill:
Balance - December 31, 2015	$	18,491
Impact of FSC acquisition		178
Balance, June 30 2016	$	18,669

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Long-Term Related Party Payable

6 Months Ended

Jun. 30, 2016

Debt Disclosure [Abstract]

Related Party Transactions Disclosure [Text Block]

NOTE 7 : Long-Term Related Party Payable

Long-term related party payable and related activity are reported at fair value and consist of the following at June 30, 2016 and December 31, 2015:

			Activity during Six-Months Ended June 30, 2016
							Changes in Fair Value of Related Party Payable
	Balance,  December 31, 2015		Additions		Payments to Related Parties		Operating Expense		Other Expense		Balance,  June 30, 2016
Acquisition-related contingent consideration:
Warrants - Éclat Pharmaceuticals (a)	$	20,617	$	-	$	-	$	(5,155)	$	-	$	15,462
Earn-out payments - Éclat Pharmaceuticals (b)		90,468		-		(14,216)		38,362		-		114,614
Royalty agreement - FSC (c)		-		7,695		(124)		(1,066)		-		6,505
Financing-related:
Royalty agreement - Deerfield (d)		7,862		-		(1,337)		-		2,915		9,440
Royalty agreement - Broadfin (e)		3,746		-		(638)		-		1,392		4,500
Long-term liability - FSC (f)		-		15,000		-		-		-		15,000
Total related party payable		122,693	$	22,695	$	(16,315)	$	32,141	$	4,307		165,521
Less: Current portion		(25,204)										(29,500)
Total long-term related party payable	$	97,489									$	136,021

(a) As part of the consideration for the Company’s acquisition of Éclat on March 13, 2012, the Company issued two warrants with a six-year term which allow for the purchase of a combined total of 3,300 ordinary shares of Flamel. One warrant is exercisable for 2,200 shares at an exercise price of $7.44 per share, and the other warrant is exercisable for 1,100 shares at an exercise price of $11.00 per share.

The fair value of the warrants is estimated on a quarterly basis using a Black-Scholes option pricing model with the following assumptions as of June 30:

Deerfield Warrant Valuation	June 30, 2016			June 30, 2015
Weighted average exercise price per share		$ 8.63		$	8.63
Expected term (years)		1.75			2.75
Expected volatility		69.70	%		62.90	%
Risk-free interest rate		0.55	%		0.92	%
Expected dividend yield		-			-

These Black-Scholes fair value measurements are based on significant inputs not observable in the market and thus represent a level 3 measurement as defined in ASC 820. The fair value of the warrant consideration is most sensitive to movement in the Company’s share price and expected volatility at the balance sheet date.

Expected term: The expected term of the options or warrants represents the period of time between the grant date and the time the options or warrants are either exercised or forfeited, including an estimate of future forfeitures for outstanding options or warrants. Given the limited historical data and the grant of stock options and warrants to a limited population, the simplified method has been used to calculate the expected life.

Expected volatility: The expected volatility is calculated based on an average of the historical volatility of the Company's stock price for a period approximating the expected term.

Risk-free interest rate: The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant and a maturity that approximates the expected term.

Expected dividend yield: The Company has not distributed any dividends since its inception, and has no plan to distribute dividends in the foreseeable future.

At the closing date of the 2012 Éclat acquisition and at June 30, 2016, it was uncertain as to whether the Company would ultimately fulfill its obligation under these warrants using Company shares or cash. Accordingly, pursuant to the guidance of ASC 480, the Company determined that these warrants should be classified as a long-term liability. This classification as a long-term liability was further supported by the Company’s determination, pursuant to the guidance of ASC 815-40-15-7(i), that these warrants could also not be considered as being indexed to the Company’s own stock, on the basis that the exercise price for the warrants is determined in U.S. dollars, although the functional currency of the Company at the closing date of the Éclat acquisition was the Euro.

(b) In March 2012, the Company acquired all of the membership interests of Éclat from Breaking Stick Holdings, L.L.C. (“Breaking Stick”, formerly Éclat Holdings), an affiliate of Deerfield. Breaking Stick is majority owned by Deerfield, with a minority interest owned by Mr. Michael Anderson, the Company’s CEO, and certain other current and former employees. As part of the consideration, the Company committed to provide quarterly earn-out payments equal to 20% of any gross profit generated by certain Éclat products. These payments will continue in perpetuity, to the extent gross profit of the related products also continue in perpetuity.

(c) In February 2016, the Company acquired all of the membership interests of FSC from Deerfield. The consideration for this transaction in part included a commitment to pay quarterly a 15% royalty on the net sales of certain FSC products, up to $12,500 for a period not exceeding ten years.

(d) As part of a February 2013 debt financing transaction conducted with Deerfield, the Company received cash of $2,600 in exchange for entering into a royalty agreement whereby the Company shall pay quarterly a 1.75% royalty on the net sales of certain Éclat products until December 31, 2024.

(e) As part of a December 2013 debt financing transaction conducted with Broadfin Healthcare Master Fund, a related party and current shareholder, the Company received cash of $2,200 in exchange for entering into a royalty agreement whereby the Company shall pay quarterly a 0.834% royalty on the net sales of certain Éclat products until December 31, 2024.

(f) In February 2016, the Company acquired all of the membership interests of FSC from Deerfield. The consideration for this transaction in part consists of payments totaling $1,050 annually for five years with a final payment in January 2021 of $15,000.

At June 30, 2016, the fair value of each related party payable listed in (b) through (e) above was estimated using a discounted cash flow model based on probability-adjusted annual net revenues or gross profit, as appropriate, of each of the specified Éclat and FSC products using an appropriate risk-adjusted discount rate ranging from 15% to 32%. These fair value measurements are based on significant inputs not observable in the market and thus represent a level 3 measurement as defined in ASC 820. Subsequent changes in the fair value of the acquisition-related contingent consideration payable, resulting primarily from management’s revision of key assumptions, will be recorded in the ‘Changes in fair value of related party contingent consideration’ line within the Company’s Condensed Consolidated Statements of Loss.

The Company has chosen to make a fair value election pursuant to ASC 825, “Financial Instruments” for its royalty agreements detailed in items (d) and (e) above. These financing-related liabilities are recorded at fair market value on the Condensed Consolidated Balance Sheets and the periodic change in fair market value is recorded as a component of “Other expense – change in fair value of related party payable” on the Condensed Consolidated Statements of Loss.

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Income Taxes

6 Months Ended

Jun. 30, 2016

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

NOTE 8 : Income Taxes

The components of income (loss) before income taxes are as follows:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2016		2015		2016		2015
United States	$	(2,187)	$	4,050	$	11,762	$	20,773
France		(2,288)		(1,123)		(9,089)		9,113
Ireland		(8,034)		(11,278)		(13,928)		(16,317)
Total income (loss) before income taxes	$	(12,509)	$	(8,351)	$	(11,255)	$	13,569

The items accounting for the difference between the income tax provision computed at the French statutory rate and the Company's effective tax rate are as follows:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2016			2015			2016			2015
Statutory tax rate		33.3	%		33.3	%		33.3	%		33.3	%
International tax rates differential		(13.2)	%		(31.8)	%		(27.7)	%		27.6	%
Valuation allowance on net operating losses		(11.9)	%		(16.0)	%		(34.8)	%		2.4	%
Nondeductible contingent consideration		(64.2)	%		(132.3)	%		(96.0)	%		90.9	%
Nondeductible stock-based compensation		(1.7)	%		38.9	%		(3.9)	%		(26.4)	%
Deferred charge from IP transfer		-			(0.2)	%		(4.4)	%		0.5	%
State and local income taxes		(2.8)	%		(1.6)	%		(4.2)	%		1.9	%
Other		0.9	%		8.0	%		6.4	%		(3.4)	%
Effective income tax rate		(59.5)	%		(101.9)	%		(131.2)	%		126.9	%
Income tax provision - at Statutory tax rate	$	(4,165)		$	(2,781)		$	(3,748)		$	4,518
International tax rates differential		1,647			2,658			3,115			3,748
Valuation allowance on net operating losses		1,485			1,338			3,913			332
Nondeductible contingent consideration		8,029			11,049			10,800			12,329
Nondeductible stock-based compensation		216			(3,246)			434			(3,579)
Deferred charge from IP transfer		(1)			17			493			69
State and local income taxes		356			136			477			255
Other		(118)			(664)			(723)			(458)
Income tax provision - at Effective income tax rate	$	7,449		$	8,507		$	14,761		$	17,214

The income tax provision for the three months ended June 30, 2016 and 2015 was $7,449 and $8,507, respectively. The decrease in the income tax provision for the three months ended June 30, 2016 is primarily the result of decreases in the amount of pre-tax income recorded in the United States and France, when compared to the same period in 2015. The decrease in the income tax provision for the three months ended June 30, 2016 would have been larger, but a tax benefit from stock-based compensation recorded in the same period in 2015 did not repeat in 2016.

The income tax provision for the six months ended June 30, 2016 and 2015 was $14,761 and $17,214, respectively. The decrease in the income tax provision for the six months ended June 30, 2016 is primarily the result of decreases in the amount of pre-tax income recorded in the United States and France, when compared to the same period in 2015. The decrease in the income tax provision for the six months ended June 30, 2016 would have been larger, but a tax benefit from stock-based compensation recorded in the same period in 2015 did not repeat in 2016 and the Company was required to record a valuation allowance against the net operating losses generated in France in 2016.

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Other Assets and Liabilities

6 Months Ended

Jun. 30, 2016

Other Liabilities Disclosure [Abstract]

Other Liabilities Disclosure [Text Block]

NOTE 9 : Other Assets and Liabilities

Various other assets and liabilities are summarized as follows:

	June 30,		December 31,
Prepaid expenses and other current assets:	2016		2015
Valued-added tax recoverable	$	1,216	$	1,099
Prepaid expenses		3,457		2,921
Advance to suppliers and other current assets		1,604		518
Income tax receivable		3,380		3,526
Total	$	9,657	$	8,064

	June 30,		December 31,
Other non-current assets:	2016		2015
Deferred tax assets	$	5,542	$	-
Other		119		167
Total	$	5,661	$	167

	June 30,		December 31,
Accrued expenses:	2016		2015
Accrued compensation	$	2,383	$	1,888
Accrued social charges		1,132		1,710
Accrued trade discounts and rebates		6,914		5,710
Other		163		-
Total	$	10,592	$	9,308

	June 30,		December 31,
Other current liabilities:	2016		2015
Valued-added tax payable	$	185	$	-
Other		479		133
Total	$	664	$	133

	June 30,		December 31,
Other non-current liabilities:	2016		2015
Provision for retirement indemnity	$	2,274	$	2,170
Other		597		356
Total	$	2,871	$	2,526

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Net Loss Per Share

6 Months Ended

Jun. 30, 2016

Earnings Per Share [Abstract]

Earnings Per Share [Text Block]

NOTE 10 : Net Loss Per Share

 

Basic net loss per share is calculated using the weighted average number of shares outstanding during each period. The diluted net loss per share calculation includes the impact of dilutive equity compensation awards and contingent consideration warrants.

A reconciliation of basic and diluted net loss per share, together with the related shares outstanding in thousands is as follows:  

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Loss Per Share	2016		2015		2016		2015
Net loss	$	(19,958)	$	(16,858)	$	(26,016)	$	(3,645)
Weighted average shares:
Basic shares		41,241		40,353		41,241		40,281
Effect of dilutive securities—options and warrants outstanding		-		-		-		-
Diluted shares		41,241		40,353		41,241		40,281
Net loss per share - basic	$	(0.48)	$	(0.42)	$	(0.63)	$	(0.09)
Net loss per share - diluted	$	(0.48)	$	(0.42)	$	(0.63)	$	(0.09)

Potential common shares of 6,596 and 6,634 were excluded from the calculation of weighted average shares for the three and six months ended June 30, 2016 and 2015, respectively, because their effect was considered to be anti-dilutive.

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Comprehensive Income (Loss)

6 Months Ended

Jun. 30, 2016

Stockholders' Equity Note [Abstract]

Comprehensive Income (Loss) Note [Text Block]

NOTE 11 : Comprehensive Income (Loss)

The following table shows the components of accumulated other comprehensive loss for the three and six months ended June 30, 2016 and 2015, net of tax effects:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Accumulated Other Comprehensive Loss	2016		2015		2016		2015
Foreign currency translation adjustment:
Beginning balance	$	(17,495)	$	(23,874)	$	(22,312)	$	(7,225)
Net other comprehensive (loss) income		(2,457)		5,262		2,360		(11,387)
Balance at June 30	$	(19,952)	$	(18,612)	$	(19,952)	$	(18,612)
Unrealized gain (loss) on marketable securities, net
Beginning balance	$	574	$	158	$	(345)	$	(198)
Net other comprehensive (loss) income, net of ($73), $0, ($158), $0 tax		528		(356)		1,447		-
Balance at June 30	$	1,102	$	(198)	$	1,102	$	(198)
Accumulated Other Comprehensive Loss at June 30	$	(18,850)	$	(18,810)	$	(18,850)	$	(18,810)

The effect on the Company’s condensed consolidated financial statements of amounts reclassified out of accumulated other comprehensive loss was immaterial for all periods presented.

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Shareholders' Equity

6 Months Ended

Jun. 30, 2016

Stockholders' Equity Note [Abstract]

Stockholders Equity Note Disclosure [Text Block]

NOTE 12 : Shareholders’ Equity

The following table presents a reconciliation of the Company’s beginning and ending balances in shareholders’ equity for the six months ended June 30, 2016:

	Six Months Ended
Shareholders' Equity	June 30, 2016
Shareholders' equity - January 1	$	69,134
Net loss		(26,016)
Other comprehensive income		3,807
Stock-based compensation expense		4,913
Shareholders' equity - June 30	$	51,838

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Company Operations by Product

6 Months Ended

Jun. 30, 2016

Segment Reporting [Abstract]

Segment Reporting Disclosure [Text Block]

NOTE 13 : Company Operations by Product

The Company has determined that it operates in one segment, the development and commercialization of pharmaceutical products, including controlled-release therapeutic products based on its proprietary polymer based technology. The Company's Chief Operating Decision Maker is the CEO. The CEO and the Board review profit and loss information on a consolidated basis to assess performance and make overall operating decisions as well as resource allocations. All products are included in one segment because the majority of our products have similar economic and other characteristics, including the nature of the products and production processes, type of customers, distribution methods and regulatory environment.

The following table presents a summary of total revenues by these products:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Revenues	2016		2015		2016		2015
Bloxiverz	$	25,620	$	44,283	$	50,367	$	72,726
Vazculep		10,421		3,627		19,827		7,151
Other		2,124		692		3,324		1,251
Total product sales and services		38,165		48,602		73,518		81,128
License and research revenue		693		-		1,556		-
Total revenues	$	38,858	$	48,602	$	75,074	$	81,128

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2016

Commitments and Contingencies Disclosure [Abstract]

Commitments And Contingencies Disclosure [Text Block]

NOTE 14 : Commitments and Contingencies

 

Litigation

The Company is subject to potential liabilities generally incidental to its business arising out of present and future lawsuits and claims related to product liability, personal injury, contract, commercial, intellectual property, tax, employment, compliance and other matters that arise in the ordinary course of business. The Company accrues for potential liabilities when it is probable that future costs (including legal fees and expenses) will be incurred and such costs can be reasonably estimated. At June 30, 2016 and December 31, 2015, there were no contingent liabilities with respect to any threat of litigation, arbitration or administrative or other proceeding that are reasonably likely to have a material adverse effect on the Company’s condensed consolidated financial position, results of operations, cash flows or liquidity.

Material Commitments

Other than commitments to Recipharm and for operating leases as disclosed in Note 12 - Contingent Liabilities and Commitments to the Company's consolidated financial statements included in Part II, Item 8 of the Company’s 2015 Annual Report, there were no other material commitments outside of the normal course of business. Material commitments in the normal course of business include long-term debt, and post-retirement benefit plan obligations which are disclosed in Note 7 - Long-Term Debt and Note 10 – Post-Retirement Benefit Plans, respectively, to the Company's consolidated financial statements included in Part II, Item 8 of the Company’s 2015 Annual Report and long-term contingent consideration payable as disclosed in Note 7 – Long-term Related Party Payable, to the Company's condensed consolidated financial statements included in Part I, Item 1 of this report.

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Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2016

Accounting Policies [Abstract]

Nature Of Business Policy [Policy Text Block]

Nature of Operations. Flamel Technologies S.A. (“Flamel,” the “Company,” “we” or “us”) is organized as a Société Anonyme, a form of corporation under the laws of The Republic of France. The Company was founded in 1990. Flamel is a specialty pharmaceutical company utilizing core competencies in drug delivery and formulation development to create safer and more efficacious pharmaceutical products to address unmet medical needs and/or reduce overall healthcare costs. The Company has a business model consisting of:

· an Unapproved Marketed Drugs (“UMDs”) business with two approved products in the United States, Bloxiverz^® (neostigmine methylsulfate injection) and Vazculep^® (phenylephrine hydrochloride injection) that are currently marketed, a third product, Akovaz® (ephedrine sulphate injection) for which we obtained FDA approval on April 29, 2016 and which we intend to begin marketing in the third quarter of 2016, and a fourth product currently being studied by us for possible submission for review by the FDA. The UMD business was obtained through the acquisition of Éclat Pharmaceuticals, LLC’s (or “Éclat”) on March 13, 2012,  

· a branded pediatric specialty pharmaceutical business, with three FDA approved products and one FDA approved medical device, acquired through the acquisition of FSC Laboratories and FSC Pediatrics (“FSC”) on February 5, 2016; and  

· a branded business, focusing on the development of products utilizing Flamel’s proprietary drug delivery platforms. The branded products that are based on Flamel’s proprietary drug delivery platforms target high-value solid and liquid oral and alternative dosage forms using 505(b)(2) and Biosimilar pathways where the Company is able to develop strong intellectual property positions and deliver meaningful patient benefits.

Flamel is headquartered in Lyon, France and has operations in St. Louis, Missouri, United States, and Dublin, Ireland.

Basis of Accounting, Policy [Policy Text Block]

Basis of Presentation. The Condensed Consolidated Balance Sheet as of December 31, 2015, which is derived from the prior year 2015 audited consolidated financial statements, and the interim unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (U.S. GAAP), the requirements of Form 10-Q and Article 10 of Regulation S-X and, consequently, do not include all information or footnotes required by U.S. GAAP for complete financial statements or all the disclosures normally made in an annual report on Form 10-K. Accordingly, the unaudited condensed consolidated financial statements included herein should be read in conjunction with the audited consolidated financial statements and footnotes included in the Company’s 2015 Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 15, 2016.

The unaudited condensed consolidated financial statements include the accounts of the Company, and reflect all adjustments (consisting only of normal recurring adjustments) that are, in the opinion of management, necessary for a fair presentation of the Company’s financial position, results of operations and cash flows for the dates and periods presented. All intercompany accounts and transactions have been eliminated. Results for interim periods are not necessarily indicative of the results to be expected during the remainder of the current year or for any future period.

Foreign Currency Transactions and Translations Policy [Policy Text Block]

Foreign Currency Translation. The reporting currency of the Company and its wholly-owned subsidiaries is the U.S. dollar. Each of the Company's non-U.S. subsidiaries and the parent entity uses local currency as their functional currency. Subsidiaries and entities that do not use the U.S. dollar as their functional currency translate 1) profit and loss accounts at the weighted average exchange rates during the reporting period, 2) assets and liabilities at period end exchange rates and 3) shareholders' equity accounts at historical rates. Resulting translation gains and losses are included as a separate component of shareholders' equity in Accumulated Other Comprehensive Loss. Assets and liabilities denominated in a currency other than the subsidiary's functional currency are translated to the subsidiary's functional currency at period end exchange rates. Resulting gains and losses are recognized in the Condensed Consolidated Statements of Loss.

Reclassification, Policy [Policy Text Block]

Reclassifications and Immaterial Corrections of Prior Period Amounts. The accompanying condensed consolidated financial statements for prior periods contain certain reclassifications to conform to the presentation used in 2016. Additionally, the Company has identified certain immaterial errors related to prior reporting periods. The Company has assessed the impact of the errors on its prior period financial statements included in our December 31, 2015 Annual Report on Form 10-K and concluded that the errors were not material to those financial statements.

Although the effect of the errors was not material to any previously issued financial statements, the cumulative effect of correcting the errors would have been material for the period ended June 30, 2016.

Consequently, the Company has presented the effects of these errors and reclassifications on its prior period financial statements in the tables below. In future filings the financial statements for comparative periods affected by these errors and reclassifications will be revised.

The impact of the above errors and reclassifications on previously presented line items for each comparative period presented is as follows:

	Three Months Ended
	June 30, 2015
				Correction of Immaterial Errors
Consolidated Statement of Loss:	As filed			(a)			(b)			(c)			As revised
Product sales and services	$	49,795		$	-		$	-		$	(1,193	)	$	48,602
Total revenue		49,795			-			-			(1,193	)		48,602
Operating income (loss)		(1,177	)		-			-			(1,193	)		(2,370	)
Income (loss) before income taxes		(7,158	)		-			-			(1,193	)		(8,351	)
Income tax provision		10,242			(292	)		(1,026	)		(417	)		8,507
Net loss		(17,400	)		292			1,026			(776	)		(16,858	)
Net loss per share - basic	$	(0.43	)	$	0.01		$	0.02		$	(0.02	)	$	(0.42	)
Net loss per share - diluted	$	(0.43	)	$	0.01		$	0.02		$	(0.02	)	$	(0.42	)

	Six Months Ended
	June 30, 2015
				Correction of Immaterial Errors
Consolidated Statement of Loss:	As filed			(a)			(b)			(c)			(d)			As revised
Product sales and services	$	82,521		$	-		$	-		$	(1,193	)	$	(200	)	$	81,128
Total revenue		82,521			-			-			(1,193	)		(200	)		81,128
Operating income (loss)		9,037			-			-			(1,193	)		(200	)		7,644
Income (loss) before income taxes		14,962			-			-			(1,193	)		(200	)		13,569
Income tax provision		20,715			(1,158	)		(1,856	)		(417	)		(70	)		17,214
Net loss		(5,753	)		1,158			1,856			(776	)		(130	)		(3,645	)
Net loss per share - basic	$	(0.14	)	$	0.03		$	0.04		$	(0.02	)	$	-		$	(0.09	)
Net loss per share - diluted	$	(0.14	)	$	0.03		$	0.04		$	(0.02	)	$	-		$	(0.09	)

	December 31, 2015
				Correction of Immaterial Errors									Reclassifications
Consolidated Balance Sheet:	As filed			(a)			(e)			(f)			(g)			(h)		As revised
Accounts receivable	$	6,978		$	-		$	-		$	-		$	509		$	-	$	7,487
Inventories		4,155			-			(489	)		-			-			-		3,666
Prepaid expenses and other current assets		7,989			-			-			-			-			75		8,064
Total current assets		166,306			-			(489	)		-			509			75		166,401
Other		158			-			-			-			-			9		167
Total assets		214,977			-			(489	)		-			509			84		215,081
Current portion of long-term related party payable		28,614			-			-			(3,410	)		-			-		25,204
Accounts payable		10,565			-			-			-			(5,517	)		-		5,048
Accrued expenses		3,598			-			-			-			5,710			-		9,308
Income taxes		323			(227	)		(171	)		-			-			75		-
Total current liabilities		48,788			(227	)		(171	)		(3,410	)		193			75		45,248
Long-term related party payable, less current portion		94,079			-			-			3,410			-			-		97,489
Deferred taxes		1,351			(1,360	)		-			-			-			9		-
Other		2,210			-			-			-			316			-		2,526
Total liabilities		147,112			(1,587	)		(171	)		-			509			84		145,947
Accumulated deficit		(279,793	)		1,587			(318	)		-			-			-		(278,524	)
Total shareholders' equity		67,865			1,587			(318	)		-			-			-		69,134
Total liabilities and shareholders' equity		214,977			-			(489	)		-			509			84		215,081

(a)	Reflects the cumulative 2015 correction of $1,587 of income tax benefits related to the deductibility of the U.S. Internal Revenue Code Section 483 imputed interest on contingent consideration liabilities which should have been recorded in prior periods ($866, $292, $863 and ($434) in the first, second, third and fourth quarters of 2015, respectively).
(b)	Reflects the correction of $2,606 of income tax benefits from stock-based compensation and certain other items which were originally recorded in the fourth quarter of 2015 but should have been recorded in prior periods ($360 in 2012, $333 in 2013, $(693) in 2014, and $830, $1,026 and $750 in the first, second and third quarters of 2015, respectively). As these items were originally corrected in the fourth quarter of 2015, no adjustment was required to correct the consolidated balance sheet at December 31, 2015.
(c)	Reflects the correction of a $200 overstatement of revenue in the first quarter of 2015 resulting from errors in certain estimates of ending inventory amounts at our wholesalers which were originally corrected in the first quarter of 2015 but should have been recorded in the fourth quarter of 2014.
(d)	Reflects the correction of a $1,193 understatement in the second quarter of 2015 of the gross to net revenue reserves with respect to estimates for product returns as a result of improper reconciliation to revenue data communicated by service providers. As this item was originally corrected in the third quarter of 2015, no adjustment was required to correct the consolidated balance sheet at December 31, 2015.
(e)	Reflects the correction of a $489 error in the Company’s inventory obsolescence reserve accrual and expense which was originally recorded in the first quarter of 2016 but should have been recorded in the fourth quarter of 2015.
(f)	Reflects the correction of a balance sheet classification error which overstated the current portion of the long-term related party payable by $3,410.
(g)	Reflects revisions to the presentation of certain gross to net revenue reserves which were previously included in accounts payable and are now included in accrued expenses.
(h)	Reflects balance sheet reclassifications required to properly net the accrued income tax and deferred income tax amounts within the balance sheet as a result of the adjustments made in items (a) through (g) above.

In addition to the specific amounts identified within the tables above, the Company also changed the names of the previously-reported “Interest expense – changes in fair value of related party financing related contingent consideration” line on the condensed consolidated statement of income (loss) to “Other expense – changes in fair value of related party payable”, and the previously-reported “Long-term related party contingent consideration payable” line on the condensed consolidated balance sheet to “Long-term related party payable” to better reflect the underlying nature of certain royalty agreements in prior periods.

While the balance sheet revisions and reclassifications noted in the tables above impact their corresponding captions within the cash flows provided by (used in) operating activities section of the Company’s consolidated statements of cash flows in each period of 2015, there was no impact to the total net cash provided by (used in) operating activities in any of these periods.

Revenue Recognition, Policy [Policy Text Block]

Revenue. Revenue includes sales of pharmaceutical products, amortization of licensing fees, milestone payments for R&D achievements, and compensation for the execution of R&D activities.

Product Sales and Services

Revenue is generally realized or realizable and earned when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the seller’s price to the buyer is fixed or determinable, and collectability is reasonably assured. The Company records revenue from product sales when title and risk of ownership have been transferred to the customer, which is typically upon delivery to the customer and when the selling price is determinable. As is customary in the pharmaceutical industry, the Company’s gross product sales are subject to a variety of deductions in arriving at reported net product sales. These adjustments include estimates for product returns, chargebacks, payment discounts, rebates, and other sales allowances and are estimated based on analysis of historical data for the product or comparable products, as well as future expectations for such products.

For generic products and branded products sold in mature markets where the ultimate net selling price to customer is estimable, the Company recognizes revenues upon shipment to the wholesaler. For new product launches the Company recognizes revenue once sufficient data is available to determine product acceptance in the marketplace such that product returns may be estimated based on historical data and there is evidence of reorders and consideration is made of wholesaler inventory levels.

Prior to the second quarter 2016, the Company did not have sufficient historical data to estimate certain revenue deductions. As such, it could not accurately estimate the ultimate net selling price of its Éclat portfolio of products and as a result delayed revenue recognition until the wholesaler sold the product through to its customers.

During the second quarter of 2016, the Company determined that it has sufficient evidence, history, data and internal controls to estimate the ultimate selling price of its products upon shipment from its warehouse to its customers, the wholesalers. Accordingly, it discontinued the sell through revenue approach and now recognizes revenue once the product is shipped from its warehouse. As a result of this change in accounting estimate, the Company recognized $5,981 in additional revenue, or $0.05 in additional diluted net earnings (loss) per share, for the three and six months ended June 30, 2016 that previously would have been deferred until sold by the wholesalers to the hospitals.

License and Research Revenue

The Company’s license and research revenues consist of fees and milestone payments. Non-refundable fees where we have continuing performance obligations are deferred and are recognized ratably over our projected performance period. We recognize milestone payments, which are typically related to regulatory, commercial or other achievements by us or our licensees and distributors, as revenues when the milestone is accomplished and collection is reasonably assured.

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Summary of Significant Accounting Policies (Tables)

6 Months Ended

Jun. 30, 2016

Accounting Policies [Abstract]

Schedule of Error Corrections and Prior Period Adjustments [Table Text Block]

The impact of the above errors and reclassifications on previously presented line items for each comparative period presented is as follows:

	Three Months Ended
	June 30, 2015
				Correction of Immaterial Errors
Consolidated Statement of Loss:	As filed			(a)			(b)			(c)			As revised
Product sales and services	$	49,795		$	-		$	-		$	(1,193	)	$	48,602
Total revenue		49,795			-			-			(1,193	)		48,602
Operating income (loss)		(1,177	)		-			-			(1,193	)		(2,370	)
Income (loss) before income taxes		(7,158	)		-			-			(1,193	)		(8,351	)
Income tax provision		10,242			(292	)		(1,026	)		(417	)		8,507
Net loss		(17,400	)		292			1,026			(776	)		(16,858	)
Net loss per share - basic	$	(0.43	)	$	0.01		$	0.02		$	(0.02	)	$	(0.42	)
Net loss per share - diluted	$	(0.43	)	$	0.01		$	0.02		$	(0.02	)	$	(0.42	)

	Six Months Ended
	June 30, 2015
				Correction of Immaterial Errors
Consolidated Statement of Loss:	As filed			(a)			(b)			(c)			(d)			As revised
Product sales and services	$	82,521		$	-		$	-		$	(1,193	)	$	(200	)	$	81,128
Total revenue		82,521			-			-			(1,193	)		(200	)		81,128
Operating income (loss)		9,037			-			-			(1,193	)		(200	)		7,644
Income (loss) before income taxes		14,962			-			-			(1,193	)		(200	)		13,569
Income tax provision		20,715			(1,158	)		(1,856	)		(417	)		(70	)		17,214
Net loss		(5,753	)		1,158			1,856			(776	)		(130	)		(3,645	)
Net loss per share - basic	$	(0.14	)	$	0.03		$	0.04		$	(0.02	)	$	-		$	(0.09	)
Net loss per share - diluted	$	(0.14	)	$	0.03		$	0.04		$	(0.02	)	$	-		$	(0.09	)

	December 31, 2015
				Correction of Immaterial Errors									Reclassifications
Consolidated Balance Sheet:	As filed			(a)			(e)			(f)			(g)			(h)		As revised
Accounts receivable	$	6,978		$	-		$	-		$	-		$	509		$	-	$	7,487
Inventories		4,155			-			(489	)		-			-			-		3,666
Prepaid expenses and other current assets		7,989			-			-			-			-			75		8,064
Total current assets		166,306			-			(489	)		-			509			75		166,401
Other		158			-			-			-			-			9		167
Total assets		214,977			-			(489	)		-			509			84		215,081
Current portion of long-term related party payable		28,614			-			-			(3,410	)		-			-		25,204
Accounts payable		10,565			-			-			-			(5,517	)		-		5,048
Accrued expenses		3,598			-			-			-			5,710			-		9,308
Income taxes		323			(227	)		(171	)		-			-			75		-
Total current liabilities		48,788			(227	)		(171	)		(3,410	)		193			75		45,248
Long-term related party payable, less current portion		94,079			-			-			3,410			-			-		97,489
Deferred taxes		1,351			(1,360	)		-			-			-			9		-
Other		2,210			-			-			-			316			-		2,526
Total liabilities		147,112			(1,587	)		(171	)		-			509			84		145,947
Accumulated deficit		(279,793	)		1,587			(318	)		-			-			-		(278,524	)
Total shareholders' equity		67,865			1,587			(318	)		-			-			-		69,134
Total liabilities and shareholders' equity		214,977			-			(489	)		-			509			84		215,081

(a)	Reflects the cumulative 2015 correction of $1,587 of income tax benefits related to the deductibility of the U.S. Internal Revenue Code Section 483 imputed interest on contingent consideration liabilities which should have been recorded in prior periods ($866, $292, $863 and ($434) in the first, second, third and fourth quarters of 2015, respectively).
(b)	Reflects the correction of $2,606 of income tax benefits from stock-based compensation and certain other items which were originally recorded in the fourth quarter of 2015 but should have been recorded in prior periods ($360 in 2012, $333 in 2013, $(693) in 2014, and $830, $1,026 and $750 in the first, second and third quarters of 2015, respectively). As these items were originally corrected in the fourth quarter of 2015, no adjustment was required to correct the consolidated balance sheet at December 31, 2015.
(c)	Reflects the correction of a $200 overstatement of revenue in the first quarter of 2015 resulting from errors in certain estimates of ending inventory amounts at our wholesalers which were originally corrected in the first quarter of 2015 but should have been recorded in the fourth quarter of 2014.
(d)	Reflects the correction of a $1,193 understatement in the second quarter of 2015 of the gross to net revenue reserves with respect to estimates for product returns as a result of improper reconciliation to revenue data communicated by service providers. As this item was originally corrected in the third quarter of 2015, no adjustment was required to correct the consolidated balance sheet at December 31, 2015.
(e)	Reflects the correction of a $489 error in the Company’s inventory obsolescence reserve accrual and expense which was originally recorded in the first quarter of 2016 but should have been recorded in the fourth quarter of 2015.
(f)	Reflects the correction of a balance sheet classification error which overstated the current portion of the long-term related party payable by $3,410.
(g)	Reflects revisions to the presentation of certain gross to net revenue reserves which were previously included in accounts payable and are now included in accrued expenses.
(h)	Reflects balance sheet reclassifications required to properly net the accrued income tax and deferred income tax amounts within the balance sheet as a result of the adjustments made in items (a) through (g) above.

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Marketable Securities (Tables)

6 Months Ended

Jun. 30, 2016

Investments, Debt and Equity Securities [Abstract]

Available-for-sale Securities [Table Text Block]

The value at cost, gross unrealized holding gains or losses, and fair value of the Company’s available-for-sale marketable securities are summarized below as of:

	June 30,		December 31,
Marketable Securities:	2016		2015
Value at cost	$	131,041	$	81,395
Gross unrealized holding gains		1,236		15
Gross unrealized holding losses		(1,313)		(1,672)
Fair value	$	130,964	$	79,738

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Inventories (Tables)

6 Months Ended

Jun. 30, 2016

Inventory Disclosure [Abstract]

Schedule of Inventory, Current [Table Text Block]

The principal categories of inventories at June 30, 2016 and December 31, 2015 are as follows:  

	June 30,		December 31,
Inventory:	2016		2015
Finished Goods	$	3,280	$	2,545
Raw Materials		360		1,121
Total	$	3,640	$	3,666

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Acquisitions (Tables)

6 Months Ended

Jun. 30, 2016

Business Combinations [Abstract]

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block]

During the first half  of 2016, the Company determined its preliminary accounting for the FSC acquisition. As the Company completes its final accounting for the acquisition, future adjustments related to working capital, amortizable intangible assets, goodwill and deferred taxes could occur. The preliminary fair values assigned to the acquired assets and liabilities have been recognized as follows:

Assigned Fair Value:	2016 Preliminary
Accounts receivable	$	825
Inventories		2,315
Prepaid expenses and other current assets		1,712
Goodwill		178
Intangible assets:
Acquired product marketing rights		16,200
Acquired developed technology		4,400
Other assets		392
Accounts payable and other current liabilities		(3,794)
Total	$	22,228

Business Acquisition, Pro Forma Information [Table Text Block]

Had the FSC acquisition been completed as of the beginning of 2015, the Company's unaudited pro forma net sales and net loss for the six months ended June 30, 2016 and 2015 would have been as follows:

 

	Six Months Ended
Pro Forma Net Revenue and Losses	June 30, 2016		June 30, 2015
Net revenues	$	75,549	$	83,579
Net loss		(27,030)		(9,395)

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Goodwill and Intangible Assets (Tables)

6 Months Ended

Jun. 30, 2016

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Finite-Lived Intangible Assets [Table Text Block]

The Company's amortizable and unamortizable intangible assets at June 30, 2016 and December 31, 2015 are as follows:

	June 30, 2016						December 31, 2015
	Gross Value		Accumulated Amortization		Net Carrying Amount		Gross Value		Accumulated Amortization		Net Carrying Amount
Amortizable intangible assets:
Acquired developed technology - Bloxiverz	$	35,248	$	(29,373)	$	5,875	$	35,248	$	(23,498)	$	11,750
Acquired developed technology - Vazculep		12,061		(8,394)		3,667		12,061		(7,986)		4,075
Acquired developed technology - Flexichamber		4,400		(183)		4,217		-		-		-
Acquired product marketing rights		16,200		(750)		15,450		-		-		-
Total amortizable intangible assets	$	67,909	$	(38,700)	$	29,209	$	47,309	$	(31,484)	$	15,825
Unamortizable intangible assets:
Goodwill	$	18,669	$	-	$	18,669	$	18,491	$	-	$	18,491
Total unamortizable intangible assets	$	18,669	$	-	$	18,669	$	18,491	$	-	$	18,491

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block]

Amortizable intangible assets are amortized over their estimated useful lives, which range from three to ten years. Estimated amortization of intangible assets for the next five years is as follows:

Years ending December 31,	Estimated Amortization Expense
2016	$	14,616
2017		3,056
2018		3,056
2019		3,056
2020		3,056
Total	$	26,840

Schedule of Goodwill [Table Text Block]

The change in net goodwill during the six months ended June 30, 2016 is as follows:

Goodwill:
Balance - December 31, 2015	$	18,491
Impact of FSC acquisition		178
Balance, June 30 2016	$	18,669

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Long-Term Related Party Payable (Tables)

6 Months Ended

Jun. 30, 2016

Debt Disclosure [Abstract]

Schedule of Related Party Transactions [Table Text Block]

Long-term related party payable and related activity are reported at fair value and consist of the following at June 30, 2016 and December 31, 2015:

			Activity during Six-Months Ended June 30, 2016
							Changes in Fair Value of Related Party Payable
	Balance,  December 31, 2015		Additions		Payments to Related Parties		Operating Expense		Other Expense		Balance,  June 30, 2016
Acquisition-related contingent consideration:
Warrants - Éclat Pharmaceuticals (a)	$	20,617	$	-	$	-	$	(5,155)	$	-	$	15,462
Earn-out payments - Éclat Pharmaceuticals (b)		90,468		-		(14,216)		38,362		-		114,614
Royalty agreement - FSC (c)		-		7,695		(124)		(1,066)		-		6,505
Financing-related:
Royalty agreement - Deerfield (d)		7,862		-		(1,337)		-		2,915		9,440
Royalty agreement - Broadfin (e)		3,746		-		(638)		-		1,392		4,500
Long-term liability - FSC (f)		-		15,000		-		-		-		15,000
Total related party payable		122,693	$	22,695	$	(16,315)	$	32,141	$	4,307		165,521
Less: Current portion		(25,204)										(29,500)
Total long-term related party payable	$	97,489									$	136,021

(a) As part of the consideration for the Company’s acquisition of Éclat on March 13, 2012, the Company issued two warrants with a six-year term which allow for the purchase of a combined total of 3,300 ordinary shares of Flamel. One warrant is exercisable for 2,200 shares at an exercise price of $7.44 per share, and the other warrant is exercisable for 1,100 shares at an exercise price of $11.00 per share.

(b) In March 2012, the Company acquired all of the membership interests of Éclat from Breaking Stick Holdings, L.L.C. (“Breaking Stick”, formerly Éclat Holdings), an affiliate of Deerfield. Breaking Stick is majority owned by Deerfield, with a minority interest owned by Mr. Michael Anderson, the Company’s CEO, and certain other current and former employees. As part of the consideration, the Company committed to provide quarterly earn-out payments equal to 20% of any gross profit generated by certain Éclat products. These payments will continue in perpetuity, to the extent gross profit of the related products also continue in perpetuity.

(c) In February 2016, the Company acquired all of the membership interests of FSC from Deerfield. The consideration for this transaction in part included a commitment to pay quarterly a 15% royalty on the net sales of certain FSC products, up to $12,500 for a period not exceeding ten years.

(d) As part of a February 2013 debt financing transaction conducted with Deerfield, the Company received cash of $2,600 in exchange for entering into a royalty agreement whereby the Company shall pay quarterly a 1.75% royalty on the net sales of certain Éclat products until December 31, 2024.

(e) As part of a December 2013 debt financing transaction conducted with Broadfin Healthcare Master Fund, a related party and current shareholder, the Company received cash of $2,200 in exchange for entering into a royalty agreement whereby the Company shall pay quarterly a 0.834% royalty on the net sales of certain Éclat products until December 31, 2024.

(f) In February 2016, the Company acquired all of the membership interests of FSC from Deerfield. The consideration for this transaction in part consists of payments totaling $1,050 annually for five years with a final payment in January 2021 of $15,000.

Schedule Of Fair Value Assumptions Of Warrant [Table Text Block]

The fair value of the warrants is estimated on a quarterly basis using a Black-Scholes option pricing model with the following assumptions as of June 30:

Deerfield Warrant Valuation	June 30, 2016			June 30, 2015
Weighted average exercise price per share		$ 8.63		$	8.63
Expected term (years)		1.75			2.75
Expected volatility		69.70	%		62.90	%
Risk-free interest rate		0.55	%		0.92	%
Expected dividend yield		-			-

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Income Taxes (Tables)

6 Months Ended

Jun. 30, 2016

Income Tax Disclosure [Abstract]

Schedule Of Components Of Income Before Income Tax [Table Text Block]

The components of income (loss) before income taxes are as follows:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2016		2015		2016		2015
United States	$	(2,187)	$	4,050	$	11,762	$	20,773
France		(2,288)		(1,123)		(9,089)		9,113
Ireland		(8,034)		(11,278)		(13,928)		(16,317)
Total income (loss) before income taxes	$	(12,509)	$	(8,351)	$	(11,255)	$	13,569

Schedule of Effective Income Tax Rate Reconciliation [Table Text Block]

The items accounting for the difference between the income tax provision computed at the French statutory rate and the Company's effective tax rate are as follows:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2016			2015			2016			2015
Statutory tax rate		33.3	%		33.3	%		33.3	%		33.3	%
International tax rates differential		(13.2)	%		(31.8)	%		(27.7)	%		27.6	%
Valuation allowance on net operating losses		(11.9)	%		(16.0)	%		(34.8)	%		2.4	%
Nondeductible contingent consideration		(64.2)	%		(132.3)	%		(96.0)	%		90.9	%
Nondeductible stock-based compensation		(1.7)	%		38.9	%		(3.9)	%		(26.4)	%
Deferred charge from IP transfer		-			(0.2)	%		(4.4)	%		0.5	%
State and local income taxes		(2.8)	%		(1.6)	%		(4.2)	%		1.9	%
Other		0.9	%		8.0	%		6.4	%		(3.4)	%
Effective income tax rate		(59.5)	%		(101.9)	%		(131.2)	%		126.9	%
Income tax provision - at Statutory tax rate	$	(4,165)		$	(2,781)		$	(3,748)		$	4,518
International tax rates differential		1,647			2,658			3,115			3,748
Valuation allowance on net operating losses		1,485			1,338			3,913			332
Nondeductible contingent consideration		8,029			11,049			10,800			12,329
Nondeductible stock-based compensation		216			(3,246)			434			(3,579)
Deferred charge from IP transfer		(1)			17			493			69
State and local income taxes		356			136			477			255
Other		(118)			(664)			(723)			(458)
Income tax provision - at Effective income tax rate	$	7,449		$	8,507		$	14,761		$	17,214

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Other Assets and Liabilities (Tables)

6 Months Ended

Jun. 30, 2016

Other Liabilities Disclosure [Abstract]

Schedule Of Prepaid Expenses and Other Current Assets [Table Text Block]

Various other assets and liabilities are summarized as follows:

	June 30,		December 31,
Prepaid expenses and other current assets:	2016		2015
Valued-added tax recoverable	$	1,216	$	1,099
Prepaid expenses		3,457		2,921
Advance to suppliers and other current assets		1,604		518
Income tax receivable		3,380		3,526
Total	$	9,657	$	8,064

Schedule of Other Assets, Noncurrent [Table Text Block]

	June 30,		December 31,
Other non-current assets:	2016		2015
Deferred tax assets	$	5,542	$	-
Other		119		167
Total	$	5,661	$	167

Schedule of Accrued Liabilities [Table Text Block]

	June 30,		December 31,
Accrued expenses:	2016		2015
Accrued compensation	$	2,383	$	1,888
Accrued social charges		1,132		1,710
Accrued trade discounts and rebates		6,914		5,710
Other		163		-
Total	$	10,592	$	9,308

Schedule Of Other Current Liabilities [Table Text Block]

	June 30,		December 31,
Other current liabilities:	2016		2015
Valued-added tax payable	$	185	$	-
Other		479		133
Total	$	664	$	133

Schedule Of Long Term Liabilities [Table Text Block]

	June 30,		December 31,
Other non-current liabilities:	2016		2015
Provision for retirement indemnity	$	2,274	$	2,170
Other		597		356
Total	$	2,871	$	2,526

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Net Loss Per Share (Tables)

6 Months Ended

Jun. 30, 2016

Earnings Per Share [Abstract]

Schedule of Earnings Per Share Reconciliation [Table Text Block]

A reconciliation of basic and diluted net loss per share, together with the related shares outstanding in thousands is as follows:  

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Loss Per Share	2016		2015		2016		2015
Net loss	$	(19,958)	$	(16,858)	$	(26,016)	$	(3,645)
Weighted average shares:
Basic shares		41,241		40,353		41,241		40,281
Effect of dilutive securities—options and warrants outstanding		-		-		-		-
Diluted shares		41,241		40,353		41,241		40,281
Net loss per share - basic	$	(0.48)	$	(0.42)	$	(0.63)	$	(0.09)
Net loss per share - diluted	$	(0.48)	$	(0.42)	$	(0.63)	$	(0.09)

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Comprehensive Income (Loss) (Tables)

6 Months Ended

Jun. 30, 2016

Stockholders' Equity Note [Abstract]

Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block]

The following table shows the components of accumulated other comprehensive loss for the three and six months ended June 30, 2016 and 2015, net of tax effects:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Accumulated Other Comprehensive Loss	2016		2015		2016		2015
Foreign currency translation adjustment:
Beginning balance	$	(17,495)	$	(23,874)	$	(22,312)	$	(7,225)
Net other comprehensive (loss) income		(2,457)		5,262		2,360		(11,387)
Balance at June 30	$	(19,952)	$	(18,612)	$	(19,952)	$	(18,612)
Unrealized gain (loss) on marketable securities, net
Beginning balance	$	574	$	158	$	(345)	$	(198)
Net other comprehensive (loss) income, net of ($73), $0, ($158), $0 tax		528		(356)		1,447		-
Balance at June 30	$	1,102	$	(198)	$	1,102	$	(198)
Accumulated Other Comprehensive Loss at June 30	$	(18,850)	$	(18,810)	$	(18,850)	$	(18,810)

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Shareholders' Equity (Tables)

6 Months Ended

Jun. 30, 2016

Stockholders' Equity Note [Abstract]

Schedule of Stockholders Equity [Table Text Block]

The following table presents a reconciliation of the Company’s beginning and ending balances in shareholders’ equity for the six months ended June 30, 2016:

	Six Months Ended
Shareholders' Equity	June 30, 2016
Shareholders' equity - January 1	$	69,134
Net loss		(26,016)
Other comprehensive income		3,807
Stock-based compensation expense		4,913
Shareholders' equity - June 30	$	51,838

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Company Operations by Product (Tables)

6 Months Ended

Jun. 30, 2016

Segment Reporting [Abstract]

Schedule of Segment Reporting Information, by Segment [Table Text Block]

The following table presents a summary of total revenues by these products:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Revenues	2016		2015		2016		2015
Bloxiverz	$	25,620	$	44,283	$	50,367	$	72,726
Vazculep		10,421		3,627		19,827		7,151
Other		2,124		692		3,324		1,251
Total product sales and services		38,165		48,602		73,518		81,128
License and research revenue		693		-		1,556		-
Total revenues	$	38,858	$	48,602	$	75,074	$	81,128

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Summary of Significant Accounting Policies (Details) - USD ($) $ / shares in Units, $ in Thousands		3 Months Ended						6 Months Ended			12 Months Ended
		Jun. 30, 2016	Dec. 31, 2015	Sep. 30, 2015	Jun. 30, 2015		Mar. 31, 2015	Jun. 30, 2016	Jun. 30, 2015		Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Product sales and services		$ 38,165			$ 48,602			$ 73,518	$ 81,128
Total revenue		38,858			48,602			75,074	81,128
Operating income (loss)		(11,543)			(2,370)			(5,839)	7,644
Income (loss) before income taxes		(12,509)			(8,351)			(11,255)	13,569
Income tax provision		7,449			8,507			14,761	17,214
Net loss		$ (19,958)			$ (16,858)			$ (26,016)	$ (3,645)
Net loss per share - basic		$ (0.48)			$ (0.42)			$ (0.63)	$ (0.09)
Net loss per share - diluted		$ (0.48)			$ (0.42)			$ (0.63)	$ (0.09)
Restatement Adjustment [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Income tax provision					$ 1,193
Scenario, Previously Reported [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Product sales and services					49,795				$ 82,521
Total revenue					49,795				82,521
Operating income (loss)					(1,177)				9,037
Income (loss) before income taxes					(7,158)				14,962
Income tax provision					10,242				20,715
Net loss					$ (17,400)				$ (5,753)
Net loss per share - basic					$ (0.43)				$ (0.14)
Net loss per share - diluted					$ (0.43)				$ (0.14)
Adjustment A [Member] | Restatement Adjustment [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Product sales and services	[1]				$ 0				$ 0
Total revenue	[1]				0				0
Operating income (loss)	[1]				0				0
Income (loss) before income taxes	[1]				0				0
Income tax provision			$ (434)	$ 863	(292)	[1]	$ 866		(1,158)	[1]	$ 1,587
Net loss	[1]				$ 292				$ 1,158
Net loss per share - basic	[1]				$ 0.01				$ 0.03
Net loss per share - diluted	[1]				$ 0.01				$ 0.03
Adjustment B [Member] | Restatement Adjustment [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Product sales and services	[2]				$ 0				$ 0
Total revenue	[2]				0				0
Operating income (loss)	[2]				0				0
Income (loss) before income taxes	[2]				0				0
Income tax provision			$ 2,606	$ 750	(1,026)	[2]	830		(1,856)	[2]		$ (693)	$ 333	$ 360
Net loss	[2]				$ 1,026				$ 1,856
Net loss per share - basic	[2]				$ 0.02				$ 0.04
Net loss per share - diluted	[2]				$ 0.02				$ 0.04
Adjustment C [Member] | Restatement Adjustment [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Product sales and services	[3]				$ (1,193)				$ (1,193)
Total revenue	[3]				(1,193)				(1,193)
Operating income (loss)	[3]				(1,193)				(1,193)
Income (loss) before income taxes	[3]				(1,193)				(1,193)
Income tax provision	[3]				(417)				(417)
Net loss	[3]				$ (776)				$ (776)
Net loss per share - basic	[3]				$ (0.02)				$ (0.02)
Net loss per share - diluted	[3]				$ (0.02)				$ (0.02)
Adjustment D [Member] | Restatement Adjustment [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Product sales and services	[4]								$ (200)
Total revenue							$ 200		(200)	[4]
Operating income (loss)	[4]								(200)
Income (loss) before income taxes	[4]								(200)
Income tax provision	[4]								(70)
Net loss	[4]								$ (130)
Net loss per share - basic	[4]								$ 0
Net loss per share - diluted	[4]								$ 0

[1] Reflects the cumulative 2015 correction of $1,587 of income tax benefits related to the deductibility of the U.S. Internal Revenue Code Section 483 imputed interest on contingent consideration liabilities which should have been recorded in prior periods ($866, $292, $863 and ($434) in the first, second, third and fourth quarters of 2015, respectively).

[2] Reflects the correction of $2,606 of income tax benefits from stock-based compensation and certain other items which were originally recorded in the fourth quarter of 2015 but should have been recorded in prior periods ($360 in 2012, $333 in 2013, $(693) in 2014, and $830, $1,026 and $750 in the first, second and third quarters of 2015, respectively). As these items were originally corrected in the fourth quarter of 2015, no adjustment was required to correct the consolidated balance sheet at December 31, 2015.

[3] Reflects the correction of a $200 overstatement of revenue in the first quarter of 2015 resulting from errors in certain estimates of ending inventory amounts at our wholesalers which were originally corrected in the first quarter of 2015 but should have been recorded in the fourth quarter of 2014.

[4] Reflects the correction of a $1,193 understatement in the second quarter of 2015 of the gross to net revenue reserves with respect to estimates for product returns as a result of improper reconciliation to revenue data communicated by service providers. As this item was originally corrected in the third quarter of 2015, no adjustment was required to correct the consolidated balance sheet at December 31, 2015.

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Summary of Significant Accounting Policies (Details 1) - USD ($) $ in Thousands		Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2015
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Accounts receivable		$ 9,488		$ 7,487
Inventories		3,640		3,666
Prepaid expenses and other current assets		9,657		8,064
Total current assets		177,648		166,401
Other		5,661		167
Total assets		249,706		215,081
Current portion of long-term related party payable		29,500		25,204
Accounts payable		7,043		5,048
Accrued expenses		10,592		9,308
Income taxes		6,286		0
Total current liabilities		58,188		45,248
Long-term related party payable, less current portion		136,021		97,489
Deferred taxes				0
Other		2,871		2,526
Total liabilities		197,868		145,947
Accumulated deficit		(304,540)		(278,524)
Total shareholders' equity		51,838		69,134
Total liabilities and shareholders' equity		$ 249,706		215,081
Reclassification Adjustment G [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Accounts receivable	[1]			509
Inventories	[1]			0
Prepaid expenses and other current assets	[1]			0
Total current assets	[1]			509
Other	[1]			0
Total assets	[1]			509
Current portion of long-term related party payable	[1]			0
Accounts payable	[1]			(5,517)
Accrued expenses	[1]			5,710
Income taxes	[1]			0
Total current liabilities	[1]			193
Long-term related party payable, less current portion	[1]			0
Deferred taxes	[1]			0
Other	[1]			316
Total liabilities	[1]			509
Accumulated deficit	[1]			0
Total shareholders' equity	[1]			0
Total liabilities and shareholders' equity	[1]			509
Reclassification Adjustment H [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Accounts receivable	[2]			0
Inventories	[2]			0
Prepaid expenses and other current assets	[2]			75
Total current assets	[2]			75
Other	[2]			9
Total assets	[2]			84
Current portion of long-term related party payable	[2]			0
Accounts payable	[2]			0
Accrued expenses	[2]			0
Income taxes	[2]			75
Total current liabilities	[2]			75
Long-term related party payable, less current portion	[2]			0
Deferred taxes	[2]			9
Other	[2]			0
Total liabilities	[2]			84
Accumulated deficit	[2]			0
Total shareholders' equity	[2]			0
Total liabilities and shareholders' equity	[2]			84
Scenario, Previously Reported [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Accounts receivable				6,978
Inventories				4,155
Prepaid expenses and other current assets				7,989
Total current assets				166,306
Other				158
Total assets				214,977
Current portion of long-term related party payable				28,614
Accounts payable				10,565
Accrued expenses				3,598
Income taxes				323
Total current liabilities				48,788
Long-term related party payable, less current portion				94,079
Deferred taxes				1,351
Other				2,210
Total liabilities				147,112
Accumulated deficit				(279,793)
Total shareholders' equity				67,865
Total liabilities and shareholders' equity				214,977
Restatement Adjustment [Member] | Adjustment A [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Accounts receivable	[3]			0
Inventories	[3]			0
Prepaid expenses and other current assets	[3]			0
Total current assets	[3]			0
Other	[3]			0
Total assets	[3]			0
Current portion of long-term related party payable	[3]			0
Accounts payable	[3]			0
Accrued expenses	[3]			0
Income taxes	[3]			(227)
Total current liabilities	[3]			(227)
Long-term related party payable, less current portion	[3]			0
Deferred taxes	[3]			(1,360)
Other	[3]			0
Total liabilities	[3]			(1,587)
Accumulated deficit	[3]			1,587
Total shareholders' equity	[3]			1,587
Total liabilities and shareholders' equity	[3]			0
Restatement Adjustment [Member] | Adjustment E [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Accounts receivable	[4]			0
Inventories			$ 489	(489)	[4]
Prepaid expenses and other current assets	[4]			0
Total current assets	[4]			(489)
Other	[4]			0
Total assets	[4]			(489)
Current portion of long-term related party payable	[4]			0
Accounts payable	[4]			0
Accrued expenses	[4]			0
Income taxes	[4]			(171)
Total current liabilities	[4]			(171)
Long-term related party payable, less current portion	[4]			0
Deferred taxes	[4]			0
Other	[4]			0
Total liabilities	[4]			(171)
Accumulated deficit	[4]			(318)
Total shareholders' equity	[4]			(318)
Total liabilities and shareholders' equity	[4]			(489)
Restatement Adjustment [Member] | Adjustment F [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Accounts receivable	[5]			0
Inventories	[5]			0
Prepaid expenses and other current assets	[5]			0
Total current assets	[5]			0
Other	[5]			0
Total assets	[5]			0
Current portion of long-term related party payable	[5]			(3,410)
Accounts payable	[5]			0
Accrued expenses	[5]			0
Income taxes	[5]			0
Total current liabilities	[5]			(3,410)
Long-term related party payable, less current portion	[5]			3,410
Deferred taxes	[5]			0
Other	[5]			0
Total liabilities	[5]			0
Accumulated deficit	[5]			0
Total shareholders' equity	[5]			0
Total liabilities and shareholders' equity	[5]			$ 0

[1] Reflects revisions to the presentation of certain gross to net revenue reserves which were previously included in accounts payable and are now included in accrued expenses.

[2] Reflects balance sheet reclassifications required to properly net the accrued income tax and deferred income tax amounts within the balance sheet as a result of the adjustments made in items (a) through (g) above.

[3] Reflects the cumulative 2015 correction of $1,587 of income tax benefits related to the deductibility of the U.S. Internal Revenue Code Section 483 imputed interest on contingent consideration liabilities which should have been recorded in prior periods ($866, $292, $863 and ($434) in the first, second, third and fourth quarters of 2015, respectively).

[4] Reflects the correction of a $489 error in the Company’s inventory obsolescence reserve accrual and expense which was originally recorded in the first quarter of 2016 but should have been recorded in the fourth quarter of 2015.

[5] Reflects the correction of a balance sheet classification error which overstated the current portion of the long-term related party payable by $3,410.

XML

Summary of Significant Accounting Policies (Details Textual) - USD ($) $ / shares in Units, $ in Thousands		3 Months Ended							6 Months Ended			12 Months Ended
		Jun. 30, 2016	Dec. 31, 2015		Sep. 30, 2015	Jun. 30, 2015		Mar. 31, 2015	Jun. 30, 2016	Jun. 30, 2015		Dec. 31, 2015		Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012	Mar. 31, 2016
Nature Of Business And Summary Of Significant Accounting Policies [Line Items]
Income Tax Expense (Benefit)		$ 7,449				$ 8,507			$ 14,761	$ 17,214
Revenue from Change in Accounting Estimate		5,981							5,981
Revenues		38,858				48,602			75,074	81,128
Inventory, Net		3,640	$ 3,666						3,640			$ 3,666
Due to Related Parties, Current		$ 29,500	25,204						$ 29,500			25,204
Additional Diluted Net Earnings (Loss) Per Share		$ 0.05							$ 0.05
Restatement Adjustment [Member]
Nature Of Business And Summary Of Significant Accounting Policies [Line Items]
Income Tax Expense (Benefit)						1,193
Adjustment A [Member] | Restatement Adjustment [Member]
Nature Of Business And Summary Of Significant Accounting Policies [Line Items]
Income Tax Expense (Benefit)			(434)		$ 863	(292)	[1]	$ 866		(1,158)	[1]	1,587
Revenues	[1]					0				0
Inventory, Net	[1]		0									0
Due to Related Parties, Current	[1]		0									0
Adjustment B [Member] | Restatement Adjustment [Member]
Nature Of Business And Summary Of Significant Accounting Policies [Line Items]
Income Tax Expense (Benefit)			2,606		$ 750	(1,026)	[2]	830		(1,856)	[2]			$ (693)	$ 333	$ 360
Revenues	[2]					$ 0				0
Adjustment D [Member] | Restatement Adjustment [Member]
Nature Of Business And Summary Of Significant Accounting Policies [Line Items]
Income Tax Expense (Benefit)	[3]									(70)
Revenues								$ 200		$ (200)	[3]
Adjustment E [Member] | Restatement Adjustment [Member]
Nature Of Business And Summary Of Significant Accounting Policies [Line Items]
Inventory, Net			(489)	[4]								(489)	[4]				$ 489
Due to Related Parties, Current	[4]		0									0
Adjustment F [Member] | Restatement Adjustment [Member]
Nature Of Business And Summary Of Significant Accounting Policies [Line Items]
Inventory, Net	[5]		0									0
Due to Related Parties, Current	[5]		$ (3,410)									$ (3,410)

[1] Reflects the cumulative 2015 correction of $1,587 of income tax benefits related to the deductibility of the U.S. Internal Revenue Code Section 483 imputed interest on contingent consideration liabilities which should have been recorded in prior periods ($866, $292, $863 and ($434) in the first, second, third and fourth quarters of 2015, respectively).

[2] Reflects the correction of $2,606 of income tax benefits from stock-based compensation and certain other items which were originally recorded in the fourth quarter of 2015 but should have been recorded in prior periods ($360 in 2012, $333 in 2013, $(693) in 2014, and $830, $1,026 and $750 in the first, second and third quarters of 2015, respectively). As these items were originally corrected in the fourth quarter of 2015, no adjustment was required to correct the consolidated balance sheet at December 31, 2015.

[3] Reflects the correction of a $1,193 understatement in the second quarter of 2015 of the gross to net revenue reserves with respect to estimates for product returns as a result of improper reconciliation to revenue data communicated by service providers. As this item was originally corrected in the third quarter of 2015, no adjustment was required to correct the consolidated balance sheet at December 31, 2015.

[4] Reflects the correction of a $489 error in the Company’s inventory obsolescence reserve accrual and expense which was originally recorded in the first quarter of 2016 but should have been recorded in the fourth quarter of 2015.

[5] Reflects the correction of a balance sheet classification error which overstated the current portion of the long-term related party payable by $3,410.

XML

Marketable Securities (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2016	Dec. 31, 2015
Marketable Securities [Line Items]
Value at cost	$ 131,913	$ 81,395
Gross unrealized holding gains	1,851	15
Gross unrealized holding losses	(2,800)	(1,672)
Fair value	$ 130,964	$ 79,738

XML

Inventories (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Inventory [Line Items]
Finished Goods	$ 3,280	$ 2,545
Raw Materials	360	1,121
Total	$ 3,640	$ 3,666

XML

Acquisitions (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Business Combination, Separately Recognized Transactions [Line Items]
Inventories	$ 2,315
Prepaid expenses and other current assets	1,712
Goodwill	18,669	$ 18,491
Intangible assets:
Other assets	392
Accounts receivable	825
Accounts payable and other current liabilities	(3,794)
Net identifiable assets acquired	22,228
Product marketing rights [Member]
Intangible assets:
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Indefinite-Lived Intangible Assets	16,200
Developed Technology Rights [Member]
Intangible assets:
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Indefinite-Lived Intangible Assets	$ 4,400

XML

Acquisitions (Details 1) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Business Combination, Separately Recognized Transactions [Line Items]
Net revenues	$ 75,549	$ 83,579
Net loss	$ (27,030)	$ (9,395)

XML

Acquisitions (Details Textual) - USD ($) $ in Thousands		1 Months Ended	3 Months Ended	6 Months Ended
	Feb. 05, 2016	Feb. 29, 2016	Jun. 30, 2016	Jun. 30, 2016
Business Combination, Separately Recognized Transactions [Line Items]
Payments to Acquire Businesses, Gross				$ 16,315
Business Combination Royalty Payable Description	the Company shall pay quarterly a 15% royalty on the net sales of certain FSC products, up to $12,500 for a period not exceeding ten years
Business Combination, Pro Forma Information, Earnings or Loss of Acquiree since Acquisition Date, Actual			$ 3,096	4,489
Deerfield CSF LLC [Member]
Business Combination, Separately Recognized Transactions [Line Items]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Long-term Debt	$ 15,000
Payments to Acquire Businesses, Gross	1,050
Business Combination, Contingent Consideration, Liability, Total	7,695
FSC Holdings, LLC [Member]
Business Combination, Separately Recognized Transactions [Line Items]
Business Combination, Consideration Transferred, Total	22,228
Payments to Acquire Businesses, Gross		$ 1,050
Business Combination Royalty Payable Description		commitments to pay quarterly a 15% royalty on the net sales of certain FSC products, up to $12,500 for a period not exceeding ten years
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual			1,761	2,637
Business Acquisition, Transaction Costs			$ 76	$ 76
Payment For Settlement Of Net Working Capital	$ 467
FSC Holdings, LLC [Member] | Maximum [Member]
Business Combination, Separately Recognized Transactions [Line Items]
Finite-Lived Intangible Asset, Useful Life				10 years
FSC Holdings, LLC [Member] | Minimum [Member]
Business Combination, Separately Recognized Transactions [Line Items]
Finite-Lived Intangible Asset, Useful Life				7 years

XML

Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Finite-Lived Intangible Assets [Line Items]
Amortizable intangible assets: Gross Value	$ 67,909	$ 47,309
Amortizable intangible assets: Accumulated Amortization	(38,700)	(31,484)
Amortizable intangible assets: Net Carrying Value	29,209	15,825
Unamortizable intangible assets: Goodwill, Gross	18,669	18,491
Unamortizable intangible assets:Accumulated Amortization	0	0
Unamortizable intangible assets: Net Carrying Value	18,669	18,491
Goodwill [Member]
Finite-Lived Intangible Assets [Line Items]
Unamortizable intangible assets: Goodwill, Gross	18,669	18,491
Unamortizable intangible assets:Accumulated Amortization	0	0
Unamortizable intangible assets: Net Carrying Value	18,669	18,491
Product marketing rights [Member]
Finite-Lived Intangible Assets [Line Items]
Amortizable intangible assets: Gross Value	16,200	0
Amortizable intangible assets: Accumulated Amortization	(750)	0
Amortizable intangible assets: Net Carrying Value	15,450	0
Developed Technology Rights [Member] | Flexichamber Member
Finite-Lived Intangible Assets [Line Items]
Amortizable intangible assets: Gross Value	4,400	0
Amortizable intangible assets: Accumulated Amortization	(183)	0
Amortizable intangible assets: Net Carrying Value	4,217	0
Developed Technology Rights [Member] | Vazculep [Member]
Finite-Lived Intangible Assets [Line Items]
Amortizable intangible assets: Gross Value	12,061	12,061
Amortizable intangible assets: Accumulated Amortization	(8,394)	(7,986)
Amortizable intangible assets: Net Carrying Value	3,667	4,075
Developed Technology Rights [Member] | Bloxiverz [Member]
Finite-Lived Intangible Assets [Line Items]
Amortizable intangible assets: Gross Value	35,248	35,248
Amortizable intangible assets: Accumulated Amortization	(29,373)	(23,498)
Amortizable intangible assets: Net Carrying Value	$ 5,875	$ 11,750

XML

Goodwill and Intangible Assets (Details 1) $ in Thousands	Jun. 30, 2016 USD ($)
Finite-Lived Intangible Assets [Line Items]
2016	$ 14,616
2017	3,056
2018	3,056
2019	3,056
2020	3,056
Total	$ 26,840

XML

Goodwill and Intangible Assets (Details 2) $ in Thousands	6 Months Ended
	Jun. 30, 2016 USD ($)
Goodwill [Line Items]
Balance, Beginning	$ 18,491
Impact of FSC acquisition	178
Balance, Ending	$ 18,669

XML

Goodwill and Intangible Assets (Details Textual) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015	Dec. 31, 2012
Finite-Lived Intangible Assets [Line Items]
Impairment of Intangible Assets (Excluding Goodwill)	$ 3,702	$ 3,139	$ 7,216	$ 6,282	$ 7,171

XML

Long-Term Related Party Payable (Details) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015	Dec. 31, 2015
Business Acquisition, Contingent Consideration [Line Items]
Business Combination,Beginning				$ 122,693
Additions				22,695
Payments to Related Parties				(16,315)
Operating Expense; Acquisition-Related		$ 23,898	$ 32,000	32,141	$ 37,254
Interest Expense; Financing-Related				4,307
Less: Current portion		(29,500)		(29,500)		$ (25,204)
Total long-term related party payable		136,021		136,021		$ 97,489
Financing Related Costs [Member]
Business Acquisition, Contingent Consideration [Line Items]
Business Combination,Ending		165,521		165,521
Warrant [Member] | Acquisition-related Costs [Member]
Business Acquisition, Contingent Consideration [Line Items]
Business Combination,Beginning	[1]			20,617
Additions	[1]			0
Payments to Related Parties	[1]			0
Operating Expense; Acquisition-Related	[1]			(5,155)
Interest Expense; Financing-Related	[1]			0
Business Combination,Ending	[1]	15,462		15,462
Earn Out Payments [Member] | Acquisition-related Costs [Member]
Business Acquisition, Contingent Consideration [Line Items]
Business Combination,Beginning	[2]			90,468
Additions	[2]			0
Payments to Related Parties	[2]			(14,216)
Operating Expense; Acquisition-Related	[2]			38,362
Interest Expense; Financing-Related	[2]			0
Business Combination,Ending	[2]	114,614		114,614
Deerfield Royalty agreement [Member] | Financing Related Costs [Member]
Business Acquisition, Contingent Consideration [Line Items]
Business Combination,Beginning	[3]			7,862
Additions	[3]			0
Payments to Related Parties	[3]			(1,337)
Operating Expense; Acquisition-Related	[3]			0
Interest Expense; Financing-Related	[3]			2,915
Business Combination,Ending	[3]	9,440		9,440
Broadfin Royalty agreement [Member] | Financing Related Costs [Member]
Business Acquisition, Contingent Consideration [Line Items]
Business Combination,Beginning	[4]			3,746
Additions	[4]			0
Payments to Related Parties	[4]			(638)
Operating Expense; Acquisition-Related	[4]			0
Interest Expense; Financing-Related	[4]			1,392
Business Combination,Ending	[4]	4,500		4,500
FSC Royalty Agreement [Member] | Acquisition-related Costs [Member]
Business Acquisition, Contingent Consideration [Line Items]
Business Combination,Beginning	[5]			0
Additions	[5]			7,695
Payments to Related Parties	[5]			(124)
Operating Expense; Acquisition-Related	[5]			(1,066)
Interest Expense; Financing-Related	[5]			0
Business Combination,Ending	[5]	6,505		6,505
FSC Long term Liability [Member] | Financing Related Costs [Member]
Business Acquisition, Contingent Consideration [Line Items]
Business Combination,Beginning	[6]			0
Additions	[6]			15,000
Payments to Related Parties	[6]			0
Operating Expense; Acquisition-Related	[6]			0
Interest Expense; Financing-Related	[6]			0
Business Combination,Ending	[6]	$ 15,000		$ 15,000

[1] As part of the consideration for the Company’s acquisition of Éclat on March 13, 2012, the Company issued two warrants with a six-year term which allow for the purchase of a combined total of 3,300 ordinary shares of Flamel. One warrant is exercisable for 2,200 shares at an exercise price of $7.44 per share, and the other warrant is exercisable for 1,100 shares at an exercise price of $11.00 per share.

[2] In March 2012, the Company acquired all of the membership interests of Éclat from Breaking Stick Holdings, L.L.C. (“Breaking Stick”, formerly Éclat Holdings), an affiliate of Deerfield. Breaking Stick is majority owned by Deerfield, with a minority interest owned by Mr. Michael Anderson, the Company’s CEO, and certain other current and former employees. As part of the consideration, the Company committed to provide quarterly earn-out payments equal to 20% of any gross profit generated by certain Éclat products. These payments will continue in perpetuity, to the extent gross profit of the related products also continue in perpetuity.

[3] As part of a February 2013 debt financing transaction conducted with Deerfield, the Company received cash of $2,600 in exchange for entering into a royalty agreement whereby the Company shall pay quarterly a 1.75% royalty on the net sales of certain Éclat products until December 31, 2024.

[4] As part of a December 2013 debt financing transaction conducted with Broadfin Healthcare Master Fund, a related party and current shareholder, the Company received cash of $2,200 in exchange for entering into a royalty agreement whereby the Company shall pay quarterly a 0.834% royalty on the net sales of certain Éclat products until December 31, 2024.

[5] In February 2016, the Company acquired all of the membership interests of FSC from Deerfield. The consideration for this transaction in part included a commitment to pay quarterly a 15% royalty on the net sales of certain FSC products, up to $12,500 for a period not exceeding ten years.

[6] In February 2016, the Company acquired all of the membership interests of FSC from Deerfield. The consideration for this transaction in part consists of payments totaling $1,050 annually for five years with a final payment in January 2021 of $15,000.

XML

Long-Term Related Party Payable (Details 1) - Warrant [Member] - $ / shares	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Schedule of Capitalization, Long-term Debt [Line Items]
Weighted average exercise price per share	$ 8.63	$ 8.63
Expected term (years)	1 year 9 months	2 years 9 months
Expected volatility	69.70%	62.90%
Risk-free interest rate	0.55%	0.92%
Expected dividend yield	0.00%	0.00%

XML

Long-Term Related Party Payable (Details Textual) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	1 Months Ended			6 Months Ended	12 Months Ended
	Jan. 31, 2021	Feb. 29, 2016	Feb. 28, 2013	Jun. 30, 2016	Dec. 31, 2013	Mar. 31, 2012
Line of Credit Facility [Line Items]
Cash Consideration Received On Royalty Agreement			$ 2,600		$ 2,200
Percentage Of Royalty Payable On Net Sales			1.75%		0.834%
Payments to Acquire Businesses, Gross				$ 16,315
Minimum [Member]
Line of Credit Facility [Line Items]
Discounted Cash Flow Risk Adjusted Discount Rate				15.00%
Maximum [Member]
Line of Credit Facility [Line Items]
Discounted Cash Flow Risk Adjusted Discount Rate				32.00%
Eclat Pharmaceuticals [Member]
Line of Credit Facility [Line Items]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights						3,300
Class of Warrant or Right, Number of Securities Called by Each Warrant or Right						1,100
Class of Warrant or Right, Exercise Price of Warrants or Rights						$ 11.00
FSC Holdings, LLC [Member]
Line of Credit Facility [Line Items]
Percentage Of Royalty Payable On Net Sales		15.00%
Royalty Amount		$ 12,500
Payments to Acquire Businesses, Gross		$ 1,050
FSC Holdings, LLC [Member] | Scenario, Forecast [Member]
Line of Credit Facility [Line Items]
Final Payments to Acquire Business Gross	$ 15,000
Exercise Price 1 [Member] | Eclat Pharmaceuticals [Member]
Line of Credit Facility [Line Items]
Class of Warrant or Right, Number of Securities Called by Each Warrant or Right						2,200
Class of Warrant or Right, Exercise Price of Warrants or Rights						$ 7.44

XML

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Income Taxes [Line Items]
Income (loss) before income taxes	$ (12,509)	$ (8,351)	$ (11,255)	$ 13,569
United States [Member]
Income Taxes [Line Items]
Income (loss) before income taxes	(2,187)	4,050	11,762	20,773
France [Member]
Income Taxes [Line Items]
Income (loss) before income taxes	(2,288)	(1,123)	(9,089)	9,113
Ireland [Member]
Income Taxes [Line Items]
Income (loss) before income taxes	$ (8,034)	$ (11,278)	$ (13,928)	$ (16,317)

XML

Income Taxes (Details 1) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Income Taxes [Line Items]
Statutory tax rate	33.30%	33.30%	33.30%	33.30%
International tax rates differential	(13.20%)	(31.80%)	(27.70%)	27.60%
Valuation allowance on net operating losses	(11.90%)	(16.00%)	(34.80%)	2.40%
Nondeductible contingent consideration	(64.20%)	(132.30%)	(96.00%)	90.90%
Nondeductible stock-based compensation	(1.70%)	38.90%	(3.90%)	(26.40%)
Deferred charge from IP transfer	0.00%	(0.20%)	(4.40%)	0.50%
State and local income taxes	(2.80%)	(1.60%)	(4.20%)	1.90%
Other	0.90%	8.00%	6.40%	(3.40%)
Effective income tax rate	(59.50%)	(101.90%)	(131.20%)	126.90%
Income tax provision - at Statutory tax rate	$ (4,165)	$ (2,781)	$ (3,748)	$ 4,518
International tax rates differential	1,647	2,658	3,115	3,748
Valuation allowance on net operating losses	1,485	1,338	3,913	332
Nondeductible contingent consideration	8,029	11,049	10,800	12,329
Nondeductible stock-based compensation	216	(3,246)	434	(3,579)
Deferred charge from IP transfer	(1)	17	493	69
State and local income taxes	356	136	477	255
Other	(118)	(664)	(723)	(458)
Income tax provision - at Effective income tax rate	$ 7,449	$ 8,507	$ 14,761	$ 17,214

XML

Income Taxes (Details Textual) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Income Taxes [Line Items]
Effective Income Tax Rate Reconciliation, Tax Credit, Research, Amount	$ 7,449	$ 8,507	$ 14,761	$ 17,214

XML

Other Assets and Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Prepaid expenses and other current assets
Valued-added tax recoverable	$ 1,216	$ 1,099
Prepaid expenses	3,457	2,921
Advance to suppliers and other current assets	1,604	518
Income tax receivable	3,380	3,526
Total	$ 9,657	$ 8,064

XML

Other Assets and Liabilities (Details 1) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Prepaid Expenses And Other Current Assets [Line Items]
Deferred tax assets	$ 5,542	$ 0
Other	119	167
Total	$ 5,661	$ 167

XML

Other Assets and Liabilities (Details 2) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Accrued Expenses [Line Items]
Accrued compensation	$ 2,383	$ 1,888
Accrued social charges	1,132	1,710
Accrued trade discounts and rebates	6,914	5,710
Other	163	0
Total	$ 10,592	$ 9,308

XML

Other Assets and Liabilities (Details 3) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Other Current And Long Term Liabilities [Line Items]
Valued-added tax payable	$ 185	$ 0
Other	479	133
Total	$ 664	$ 133

XML

Other Assets and Liabilities (Details 4) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Other Current And Long Term Liabilities [Line Items]
Provision for retirement indemnity	$ 2,274	$ 2,170
Other	597	356
Total	$ 2,871	$ 2,526

XML

Net Loss Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Earnings Per Share [Line Items]
Net loss	$ (19,958)	$ (16,858)	$ (26,016)	$ (3,645)
Weighted average shares:
Basic shares	41,241	40,353	41,241	40,281
Effect of dilutive securities—options and warrants outstanding	$ 0	$ 0	$ 0	$ 0
Diluted shares	41,241	40,353	41,241	40,281
Effect of dilutive securities:
Income (loss) before income taxes	$ (0.48)	$ (0.42)	$ (0.63)	$ (0.09)
Net loss per share - diluted	$ (0.48)	$ (0.42)	$ (0.63)	$ (0.09)

XML

Net Loss Per Share (Details Textual) - shares shares in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Earnings Per Share [Line Items]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	6,596	6,596	6,634	6,634

XML

Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015	Dec. 31, 2015
Class of Stock [Line Items]
Foreign currency translation adjustment Income (Loss), Net, Beginning Balance	$ (17,495)	$ (23,874)	$ (22,312)	$ (7,225)
Foreign currency translation adjustment Income (Loss), Net, Balance, Other comprehensive income (loss)	(2,457)	5,262	2,360	(11,387)
Foreign currency translation adjustment Income (Loss), Net, Ending Balance	(19,952)	(18,612)	(19,952)	(18,612)
Unrealized gain (loss) on marketable securities, net, Beginning Balance	574	158	(345)	(198)
Unrealized gain (loss) on marketable securities, net, Ending Balance	1,102	(198)	1,102	(198)
Unrealized gain (loss) on marketable securities, net of ($73), $0, ($158), $0 tax	528	(356)	1,447	0
Accumulated Other Comprehensive Loss at June 30	$ (18,850)	$ (18,810)	$ (18,850)	$ (18,810)	$ (22,657)

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Comprehensive Income (Loss) (Details Textual) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Other Comprehensive Income (Loss), Unrealized Holding Gain (Loss) on Securities Arising During Period, Tax	$ (73)	$ 0	$ (158)	$ 0

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Shareholders' Equity (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Class of Stock [Line Items]
Shareholders' equity - January 1			$ 69,134
Net loss	$ (19,958)	$ (16,858)	(26,016)	$ (3,645)
Other comprehensive income	(1,929)	$ 4,906	3,807	(11,387)
Stock-based compensation expense			4,913	$ 4,152
Shareholders' equity - June 30	$ 51,838		$ 51,838

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Company Operations by Product (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Company Operations by Product [Line Items]
Total product sales and services	$ 38,165	$ 48,602	$ 73,518	$ 81,128
License and research revenue	693	0	1,556	0
Total revenues	38,858	48,602	75,074	81,128
Bloxiverz [Member]
Company Operations by Product [Line Items]
Total product sales and services	25,620	44,283	50,367	72,726
Vazculep [Member]
Company Operations by Product [Line Items]
Total product sales and services	10,421	3,627	19,827	7,151
Other [Member]
Company Operations by Product [Line Items]
Total product sales and services	$ 2,124	$ 692	$ 3,324	$ 1,251