Quarterly report pursuant to Section 13 or 15(d)

Restatement of Financial Statements

v2.4.0.6
Restatement of Financial Statements
3 Months Ended
Mar. 31, 2012
Restatement of Financial Statements [Abstract]  
Restatement of Financial Statements

11. Restatement of Financial Statements

The Company restated its previously issued condensed consolidated financial statements as of March 31, 2012 and for the three months ended March 31, 2012 and 2011, to correct errors in the calculation of certain contingent liabilities related to the acquisition of CyDex. Specifically, the initial fair value of contingent liabilities 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, an overstatement of the deferred tax liability of $0.3 million, and an understatement of intangible assets of $0.9 million. As of March 31, 2012, goodwill was overstated by $2.7 million, intangible assets were understated by $0.9 million, long-term portion of contingent liabilities was overstated by $0.8 million and deferred income taxes were overstated by $0.3 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 March 31, 2012, decrease (increase) in contingent liabilities decreased $0.3 million from $0.8 million to $0.5 million and loss from continuing operations increased $0.01 per share from $0.03 per share to $0.04 per share. For the three months ended March 31, 2011, decrease (increase) in contingent liabilities increased $0.6 million from $1.7 million to $2.3 million and income tax benefit increased $0.1 million from $13.6 million to 13.7 million. Income from continuing operations for the three months ended March 31, 2011 decreased $0.02 per share from $0.51 to $0.49.

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 three months ended March 31, 2012 and 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 March 31, 2012 and December 31, 2011 and for the periods ended March 31, 2012 and 2011 are described in the table below:

 

                                 
    March 31, 2012     December 31, 2011  
    As
previously
reported
    As Restated     As
previously
reported
    As Restated  

Balance sheet data:

                               

Goodwill

  $ 14,894     $ 12,238     $ 14,894     $ 12,238  

Intangible assets, net

    56,855       57,744       57,437       58,326  

Total assets

    111,798       110,031       122,350       120,583  

Long-term portion of contingent liabilities

    10,550       9,787       11,433       10,419  

Deferred income taxes

    2,664       2,372       2,522       2,230  

Total liabilities

    92,555       91,500       105,360       104,054  

Accumulated deficit

    (680,387     (681,099     (681,771     (682,232

 

                                 
    Three Months Ended
March 31, 2012
    Three Months Ended
March  31, 2011
 
    As
Previously
Reported
    As Restated     As
Previously
Reported
    As Restated  

Statement of Operations data:

                               

Decrease (increase) in contingent liabilities

  $ 764     $ 513     $ (1,736   $ (2,288

Income tax benefit from continuing operations

    —         —         13,585       13,730  

Net Income

    1,384       1,133       10,032       9,621  

Basic and diluted earnings per share:

                               

Income (loss) from continuing operations

  $ (0.03   $ (0.04   $ 0.51     $ 0.49  

Net Income

    0.07       0.06       0.51       0.49  

Weighted average number of common shares-basic

    19,709       19,709       19,623       19,623  

Weighted average number of common shares-diluted

    19,709       19,709       19,623       19,623