Disposition Of Pharmaceutical Product Lines And Restructuring

12 Months Ended

Dec. 31, 2014

Disposition Of Pharmaceutical Product Lines And Restructuring [Abstract]

Disposition Of Pharmaceutical Product Lines And Restructuring

NOTE 21.DISPOSITION OF PHARMACEUTICAL PRODUCT LINES AND RESTRUCTURING

In the fourth quarter of 2008, we sold our Acarexx® and SURPASS® veterinary pharmaceutical products and a feline insulin product under development, which were a part of our CAG segment, for cash proceeds of $7.0 million, a short-term receivable of $1.4 million and up to $11.5 million of future payments based on the achievement of certain development and sales milestones by the acquirer of the feline insulin product. In the fourth quarter of 2009 we earned and received a milestone payment of $2.0 million in connection with the achievement of certain development milestones by the acquirer. We earned milestone payments of $3.5 million, $3.0 million and $3.0 million in 2012, 2011 and 2010, respectively, in connection with the achievement of certain sales milestones by the acquirer following commercialization of the feline insulin product. These aggregate milestone payments were received in the first quarter of 2013, 2012 and 2011 respectively. The 2013 milestone payment was included in other current assets on the accompanying consolidated balance sheet for the year ended December 31, 2012. Because we had no obligation to deliver product or services, or otherwise provide support to the third party under this agreement, and because collectability was reasonably assured, these milestone payments were included in results of operations when earned. The payments were not classified as revenue because the transaction was accounted for as the sale of a business; rather they were reflected as reductions to general and administrative expenses as earned. We are not eligible to receive any further milestone payments under this agreement.

In the fourth quarter of 2008, we also entered into a separate royalty bearing license agreement related to certain intellectual property of our pharmaceutical division. Under this agreement we received $0.3 million up front, $1.6 million in the fourth quarter of 2014 and $0.3 million in the fourth quarters of 2013 and 2010 in connection with the achievement of certain production and clinical field trial milestones by the licensee. We had no obligation to deliver product or services, or otherwise provide support to the third party under this agreement. Due to these circumstances, and because collectability is reasonably assured, milestone payments earned under this agreement were included in results of operations when earned. The payments received during the year ended December 31, 2014 satisfied the licensee’s milestone payment obligation. Under the agreement, future royalties are due to us contingent upon commercialization of the product.