Product Revenue and Reserves for Variable Consideration

3 Months Ended

Mar. 31, 2020

Revenue From Contract With Customer [Abstract]

Product Revenue and Reserves for Variable Consideration

3. Product Revenue and Reserves for Variable Consideration

To date, the Company’s only source of product revenue has been product revenue from the U.S. sales of Auryxia, which it began recording on December 12, 2018 following the consummation of the Merger. Total net product revenue was $29.2 million and $23.1 million for the three months ended March 31, 2020 and 2019, respectively. The following table summarizes activity in each of the product revenue allowance and reserve categories for the three months ended March 31, 2020 and 2019 (in thousands):

	Chargebacks and Discounts			Rebates, Fees and other Deductions			Returns			Total
Balance at December 31, 2019	$	738		$	30,552		$	253		$	31,543
Current provisions related to sales in current year		2,250			30,519			1,053			33,822
Adjustments related to prior year sales		82			32			—			114
Credits/payments made		(2,353	)		(29,024	)		(1,051	)		(32,428	)
Balance at March 31, 2020	$	717		$	32,079		$	255		$	33,051
Balance at December 31, 2018	$	516		$	22,861		$	360		$	23,737
Current provisions related to sales in current year		1,486			17,476			870			19,832
Adjustments related to prior year sales		—			156			—			156
Credits/payments made		(1,495	)		(17,301	)		(947	)		(19,743	)
Balance at March 31, 2019	$	507		$	23,192		$	283		$	23,982

Chargebacks, discounts and returns are recorded as a direct reduction of revenue on the unaudited condensed consolidated statement of operations with a corresponding reduction to accounts receivable on the unaudited condensed consolidated balance sheets. Rebates, distribution-related fees, and other sales-related deductions are recorded as a reduction in revenue on the unaudited condensed consolidated statement of operations with a corresponding increase to accrued liabilities or accounts payable on the unaudited condensed consolidated balance sheets.

Accounts receivable, net related to product sales was approximately $20.2 million and $23.0 million as of March 31, 2020 and December 31, 2019, respectively.