Note 17. Segment Information and Concentration of Customers and Suppliers

The Company operates in one business segment—the development and commercialization of novel therapeutic products. Therefore, results of operations are reported on a consolidated basis for purposes of segment reporting, consistent with internal management reporting. Disclosures about product revenues by geographic area; revenues and accounts receivable from major customers, and major suppliers are presented below.

Revenue

Revenue was as follows for the years ended December 31, 2013, 2012 and 2011 (in thousands):

	2013		2012

Net product revenue:
Qsymia	$	23,718	$	2,012
STENDRA or SPEDRA		1,526		—

Total net product revenue		25,244		2,012
License revenue		55,838		—

Total revenue	$	81,082	$	2,012

Geographic Information

Outside the United States, the Company sells products principally in the EU. The geographic classification of product sales was based on the location of the customer. The geographic classification of all other revenues was based on the domicile of the entity from which the revenues were earned.

Certain geographic information with respect to revenues was as follows (in thousands):

Total revenue by geographic region for the years ended December 31, 2013 and 2012, was as follows (in thousands):

	Years Ended December 31,

	2013					2012
	U.S		ROW			U.S		ROW
Qsymia—Net product revenue	$	23,718	$	—		$	2,012	$	—
STENDRA/SPEDRA—Net product revenue		1,080		446			—		—

Total net product revenue		24,798		446			2,012		—
STENDRA/SPEDRA—License revenue		30,393		25,445	(1)		—		—

Total revenue	$	55,191	$	25,891		$	2,012	$	—

(1): $21.0 million of which is attributable to Germany.

Major customers

Revenues from significant customers as a percentage of total revenues for the year ended December 31, 2013 and 2012, is as follows:



Auxilium	39	%	—	%
Menarini	26	%	—	%
CVS	9	%	50	%
Walgreens	6	%	39	%
Express Scripts, Inc.	3	%	10	%

Accounts receivable at December 31, 2013 and 2012 by significant customer as a percentage of the total gross accounts receivable balance are as follows:



Menarini	41	%	—	%
Amerisource Bergen	26	%	—	%
McKesson	13	%	—	%
Cardinal Health, Inc.	12	%	—	%
CVS	1	%	51	%
Walgreens	1	%	44	%
Express Scripts, Inc.	1	%	1	%

Major suppliers

The Company relies on third-party sole-source manufacturers to produce its clinical trial materials, raw materials and finished goods. Catalent Pharma Solutions, LLC, or Catalent, which supplied the product for the Phase 3b/4 program for Qsymia, is the Company's sole source of clinical and commercial supplies for Qsymia. MTPC is currently the Company's sole-source supplier for the API and the tablets for STENDRA (avanafil). In August 2012, the Company entered into an amendment to its agreement with MTPC that permits the Company to manufacture the API and STENDRA tablets for avanafil itself or through third-party suppliers at any time. The transition away from MTPC supply will need to occur on or before June 2015. The Company does not have any manufacturing facilities and intends to continue to rely on third parties for the supply of the starting materials, API and tablets. Third-party manufacturers may not be able to meet the Company's needs with respect to timing, quantity or quality.

The Company has entered into an agreement with PDI, Inc., or PDI, a third-party contract sales organization, to assist with the hiring of sales representatives and the promotion of Qsymia to physicians. Although alternative third-party contract sales organizations exist, the Company would be adversely affected if PDI does not perform its obligations under the agreement.

During the years ended December 31, 2013 and 2012, the Company incurred expenses for work performed by a third-party clinical research organization, or CRO, for Qsymia and STENDRA post-approval studies that accounted for 29% and 13%, respectively, of total research and development expenses. During the year ended December 31, 2011, the Company did not have any third-party CROs that accounted for 10% or more of total research and development expenses.