Inventory

Inventories consist of raw materials, work-in-process and finished goods related to the production of IMBRUVICA. Raw materials include ibrutinib active pharmaceutical ingredient (API). Work-in-process includes third-party manufacturing and associated labor costs relating to the Company’s personnel involved in the production process. Included in inventories are raw materials and work-in-process that may be used as clinical products, which are charged to research and development expense when the product enters the research and development process.

The components of inventory are as follows (in thousands):



	March 31,		December 31,
	2015		2014
Raw materials	$	15,415	$	—
Work-in-process	26,730		27,591
Finished goods	6,880		6,855
	$	49,025	$	34,446

The Company records cash advances that it pays prior to the receipt of inventory as advances to manufacturers in the condensed consolidated balance sheets. The cash advances may be forfeited if the Company terminates the scheduled production. The Company expects the carrying value of the advances to manufacturers to be fully realized.