Composition of Balance Sheet Items

6 Months Ended

Jun. 30, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Composition of Balance Sheet Items

Composition of Other Balance Sheet ItemsThe following details the composition of other balance sheet items (dollars in thousands for amounts in tables):

Accounts Receivables

As of June 30, 2021 and December 31, 2020, the Company has reduced accounts receivable by approximately $11.6 million and $11.4 million, respectively. Prompt pay discount and contractual service fees, which were originally recorded as reduction to revenues, represents estimated amounts not expected to be paid by our customers. The Company's customers are primarily pharmaceutical wholesalers and distributors and specialty pharmacies. Receivables from our three major customers account for more than 85% of our total receivables.

Inventories

	June 30, 2021		December 31, 2020
	(unaudited)
Raw materials	$	28,159	$	22,208
Work in process	15,193		8,985
Finished goods	15,039		17,132
Total	$	58,391	$	48,325

In May 2021, the Company launched Qelbree for the treatment of ADHD in pediatric patients 6 to 17 years of age in the U.S. Pre-launch inventory costs for Qelbree were $19.1 million as of December 31, 2020. Qelbree inventory was $34.2 million as of June 30, 2021.

Inventories include acquired inventory from the USWM Acquisition. Refer to Note 3, USWM Acquisition, for further discussion of the USWM Acquisition.

Property and Equipment

	June 30, 2021		December 31, 2020
	(unaudited)
Lab equipment and furniture	$	11,992	$	12,526
Leasehold improvements	12,453		15,183
Software	2,023		2,295
Finance lease assets (1)	—		22,747
Computer equipment	1,156		2,113
	27,624		54,864
Less accumulated depreciation and amortization	(10,559)		(17,040)
Total	$	17,065	$	37,824

_______________________________

(1) Refer to Note 12, Leases.

Depreciation and amortization expense on property and equipment was approximately $0.7 million and $1.3 million for the three and six months ended June 30, 2021, respectively, and approximately $0.6 million and $1.1 million for the three and six months ended June 30, 2020, respectively. The Company retired certain fully depreciated property and equipment for the three and six months ended June 30, 2021.

Accounts Payable and Accrued Liabilities

	June 30, 2021		December 31, 2020
	(unaudited)
Accounts payable	$	7,229	$	6,147
Accrued royalties (1)	13,183		13,890
Accrued product costs	13,045		9,587
Accrued compensation	12,926		16,008
Accrued professional fees	11,993		7,730
Accrued clinical trial costs (2)	7,167		12,842
Operating lease liabilities, current portion (3)	5,900		3,760
Other accrued expenses	8,550		8,970
Total	$	79,993	$	78,934

_______________________________

(1) Refer to Note 15, Commitments and Contingencies.

(2) Includes preclinical and all clinical trial-related costs.

(3) Refer to Note 12, Leases.

Accrued Product Returns and Rebates

	June 30, 2021		December 31, 2020
	(unaudited)
Accrued product rebates	$	140,718	$	96,589
Accrued product returns	32,880		29,603
Total	$	173,598	$	126,192

Other Liabilities

	June 30, 2021		December 31, 2020
	(unaudited)
Nonrecourse liability related to sale of future royalties, long term	$	10,024	$	13,410
Finance lease liability, long term (1)	—		20,235
Other liabilities	9,068		9,146
Total	$	19,092	$	42,791

______________________________

(1) Refer to Note 12, Leases.