2. Discontinued Operations Classified as Assets Held for Sale

In March 2020, the Company announced its Plan of Liquidation and passed a resolution to seek stockholder approval at its next Annual Meeting of Stockholders to dissolve the Company under Delaware state law in the event that the Board concludes that a whole Company sale is unlikely to maximize the value that can be returned to the stockholders. The Company has not set a definitive timeline for the liquidation and intends to pursue the liquidation strategy in a disciplined and cost-effective manner seeking to maximize the value that can be returned to stockholders. As a result of these actions and subsequent efforts to monetize the Company’s key assets, as well as the sale of these key assets representing a strategic shift in the operations of the Company, the assets held for sale and discontinued operations criteria were met for specific assets or components of the Company during the three months ended March 31, 2020. During the period in which a component meets the assets held for sale and discontinued operations criteria, an entity must present the assets and liabilities of the discontinued operation separately in the asset and liability sections of the balance sheet for the current and comparative reporting periods. The prior period balance sheet is reclassified for the held for sale items. For statements of operations, the current and prior periods report the results of operations of the components in discontinued operations.

The Company determined the royalty right assets and Noden met the assets held for sale and discontinued operations criteria as of March 31, 2020. The royalty right assets are a component of the Income Generating Assets segment and Noden represents the Pharmaceutical segment.

Components of amounts reflected in (Loss) income from discontinued operations are as follows (in thousands):



	Three Months Ended
	March 31,
	2020			2019
Revenues
Product revenue, net	$	15,031		$	19,961
Royalty rights - change in fair value	9,394			12,257
Total revenues	24,425			32,218
Operating expenses
Cost of product revenue (excluding intangible asset amortization)	8,781			9,010
Amortization of intangible assets	389			1,253
General and administrative	2,302			2,151
Sales and marketing	117			1,156
Research and development	—			(41		)
Total operating expenses	11,589			13,529
Operating income from discontinued operations	12,836			18,689
Non-operating expense, net
Loss on classification as held for sale	(12,761		)	—
Total non-operating expense, net	(12,761		)	—
Income from discontinued operations before income taxes	75			18,689
Income tax expense from discontinued operations	319			3,620
(Loss) income from discontinued operations	$	(244	)	$	15,069

The carrying amounts of the major classes of assets reported as “Assets held for sale” consist of the following:



(in thousands)	March 31, 2020			December 31, 2019

Cash and cash equivalents	$	21,305		$	24,469
Accounts receivable, net	8,559			6,993
Inventory	30,083			31,712
Prepaid and other current assets	8,859			7,192
Property and equipment, net	2,908			2,960
Royalty rights - at fair value	262,021			266,196
Intangible assets, net	9,723			10,112
Other assets	1,773			1,819
Less: Estimated remaining cost to sell and fair value adjustment	(12,483		)	—
Total assets held for sale ⁽¹⁾	$	332,748		$	351,453

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⁽¹⁾The assets of the disposal groups classified as held for sale are classified as current on the March 31, 2020 Balance Sheet because it is probable that the sales will occur and the proceeds will be collected within one year.

The carrying amounts of the major classes of liabilities reported as “Liabilities held for sale” consist of the following:



(in thousands)	March 31, 2020		December 31, 2019

Accounts payable	$	7,432	$	14,695
Accrued liabilities	17,122		16,400
Other long-term liabilities	—		120
Total liabilities held for sale ⁽¹⁾	$	24,554	$	31,215

________________

⁽¹⁾The liabilities of the disposal groups classified as held for sale are classified as current on the March 31, 2020 Balance Sheet because it is probable that the sales will occur and the proceeds will be collected within one year.