Quarterly report pursuant to Section 13 or 15(d)

Restatement of Financial Statements

v2.4.0.6
Restatement of Financial Statements
9 Months Ended
Sep. 30, 2012
Accounting Changes and Error Corrections [Abstract]  
Restatement of Financial Statements
Restatement of Financial Statements

The Company restated its previously issued consolidated financial statements as of December 31, 2011, to correct errors in the calculation of certain contingent liabilities related to the acquisition of CyDex. Specifically, the initial fair value of the contingent liability was overstated by $1.6 million resulting in an initial overstatement of goodwill by $2.7 million, an understatement of the income tax benefit of $0.1 million, and overstatement of the deferred tax liability of $0.3 million, and an understatement of intangible assets of $0.9 million. As of December 31, 2011, goodwill was overstated by $2.7 million, intangible assets were understated by $0.9 million, long-term portion of contingent liabilities was overstated by $1.0 million and deferred income taxes was overstated by $0.3 million. For the three months ended September 30, 2011, decrease (increase) in contingent liabilities increased $0.4 million from a decrease in contingent liabilities of $0.2 million to an increase in contingent liabilities of $0.2 million and loss from continuing operations increased $0.02 per share from $0.19 per share to $0.21 per share. For the nine months ended September 30, 2011, decrease (increase) in contingent liabilities increased $0.5 million from $0.8 million to $1.3 million, income tax benefit increased $0.1 million from $13.4 million to $13.6 million and income from continuing operations decreased $0.01 per share from $0.27 per share to $0.26 per share.

Contingent liabilities in the accompanying balance sheets now includes amounts relating to contingent value rights and other acquired contingent liabilities. The statement of cash flows has been adjusted for the restatements for the twelve months ended December 31, 2011. The only impact on the statement of cash flows is the change in the non-cash impact of contingent liabilities. The impact of the restatement as of December 31, 2011 and for the three and nine months ended September 30, 2011 is described in the table below:

 
December 31, 2011
Balance sheet data:
As previously reported
 
Restated
Goodwill
$
14,894

 
$
12,238

Intangible assets, net
57,437

 
58,326

Total assets
122,350

 
120,583

Long-term portion of contingent liabilities
11,433

 
10,419

Deferred income taxes
2,522

 
2,230

Total liabilities
105,360

 
104,054

Accumulated deficit
(681,771
)
 
(682,232
)

 
Three Months Ended September 30, 2011
 
Nine Months Ended September 30, 2011
 
As previously reported
 
Restated
 
As previously reported
 
Restated
Statement of Operations data:
 
 
 
 
 
 
 
Decrease (increase) in contingent liabilities
$
224

 
$
(198
)
 
$
(835
)
 
$
(1,317
)
Income tax benefit (expense)
(22
)
 
(22
)
 
13,427

 
13,572

Net Income (loss)
(3,756
)
 
(4,178
)
 
5,366

 
5,029

Basic and diluted earnings per share:
 
 
 
 
 
 
 
Income (loss) from continuing operations
$
(0.19
)
 
$
(0.21
)
 
$
0.27

 
$
0.26

Income from discontinued operations

 

 

 

Net Income (loss)
(0.19
)
 
(0.21
)
 
0.27

 
0.26

Weighted average number of common shares-basic
19,673
 
19,673
 
19,649
 
19,649
Weighted average number of common shares-diluted
19,673
 
19,673
 
19,649
 
19,686