INVENTORIES

Inventories consist of the following as of:

	September 30,		December 31,
(in thousands)	2015		2014
Raw materials	$	10,563	$	5,056
Packaging materials		1,023		794
Work-in-progress		573		411
Finished goods		1,775		1,368
		13,934		7,629
Reserve for excess/obsolete inventories		(193)		(111)
Inventories, net	$	13,741	$	7,518

Vendor Concentration

We source the raw materials for our products, including active pharmaceutical ingredients (“API”), from both domestic and international suppliers. Generally, only a single source of API is qualified for use in each product due to the costs and time required to validate a second source of supply. As a result, we are dependent upon our current vendors to reliably supply the API required for ongoing product manufacturing. During the three months ended September 30, 2015, we purchased approximately 35% of our inventory from two suppliers. During the nine months ended September 30, 2015, we purchased approximately 44% of our inventory from three suppliers. As of September 30, 2015, amounts payable to these three suppliers totaled $0.7 million. During the three months ended September 30, 2014, we purchased approximately 49% of our inventory from two suppliers. During the nine months ended September 30, 2014, we purchased approximately 43% of our inventory from the same two suppliers.