Revenue Recognition and Collaborative Arrangements

6 Months Ended

Jun. 30, 2019

Revenue Recognition and Collaborative Arrangements

3. Revenue Recognition and Collaborative Arrangements

Revenue is recognized when our customer obtains control of promised goods or services, in an amount that reflects the consideration which we expect to receive in exchange for those goods or services. Revenue is recognized through a five-step process: (i) identify the contract with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price for the contract; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) a performance obligation is satisfied. We recognize the royalty revenue on licensee net sales of products with respect to which we have contractual royalty rights in the period in which the royalties are earned and reported to us. Royalties are recognized net of amortization of capitalized fees associated with any approval and launch milestone payments made to GSK.

Net Revenue from Collaborative Arrangements

Net revenue recognized under our GSK Agreements was as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
(In thousands)	2019		2018		2019		2018
Royalties from a related party - RELVAR/BREO	$	47,086	$	57,515	$	89,826	$	103,675
Royalties from a related party - ANORO		10,635		10,656		19,205		19,380
Royalties from a related party - TRELEGY		9,842		2,371		17,171		3,323
Total royalties from a related party		67,563		70,542		126,202		126,378
Less: amortization of capitalized fees paid to a related party		(3,456)		(3,456)		(6,912)		(6,912)
Royalty revenue from GSK	$	64,107	$	67,086	$	119,290	$	119,466