Revenue

6 Months Ended

Jun. 30, 2020

Revenue Recognition [Abstract]

Revenue

Revenue

The Company's primary source of revenue is from royalty and milestone payments received from NARCAN® net sales by Adapt. During the three and six months ended June 30, 2020 the Company recorded revenue of $6.3 million and $10.4 million, respectively, related to its agreement with Adapt.

On September 19, 2018, the Company entered into a contract with the Biomedical Advanced Research and Development Authority (“BARDA”), which is part of the U.S. Health and Human Services Office of the Assistant Secretary for Preparedness and Response, to accelerate the Company’s development of OPTN003, its lead product candidate. OPTN003, nasal nalmefene, is a potent, long-acting opioid antagonist currently in development for the treatment of opioid overdose. The contract will provide potential funding up to a maximum of approximately $4.6 million and cover activities related to a potential New Drug Application submission for OPTN003 with the Food and Drug Administration. BARDA has awarded approximately $3.0 million of the contract through December 20, 2021, with the balance expected to be funded, subject to satisfactory project progress, availability of funds and certain other conditions. During the six months ended June 30, 2020 the Company recognized revenue of $38 thousand related to this contract.

Deferred revenue

On April 17, 2018, the Company was awarded a grant of approximately $7.4 million from the National Institutes of Health’s National Institute on Drug Abuse, (NIDA). The grant provides the Company with additional resources for the ongoing development of OPNT003. The Company has been awarded approximately $5.6 million through the period ending March 31, 2021, with the remaining $1.8 million balance expected to be funded, subject to available funds and satisfactory progress on the development of OPNT003. Government grants are agreements that generally provide cost reimbursement for certain types of expenditures in return for research and development activities over a contractually defined period. The Company recognized revenues from grants in the period during which the related costs were incurred, provided that the conditions under which the grants were provided had been met and only perfunctory obligations were outstanding. During the six months ended June 30, 2020, the Company recognized revenue of $101 thousand related to this grant.

As of June 30, 2020 the Company had recorded all of its deferred revenue as a current liability because the Company expects to recognize all such deferred revenue as revenue during the next 12 months.

The following is a summary of the Company’s deferred revenue activity as of June 30, 2020:

(in thousands)	NIDA Grant			Total
Balance as of December 31, 2019	$	918		$	918
Additions to deferred revenue	—			—
Recognized as revenue	(101		)	(101		)
Balance as of June 30, 2020	$	817		$	817