Revenue

6 Months Ended

Jun. 30, 2020

Revenue

Revenue

7.           Revenue

	Three Months Ended				Six Months Ended
	June 30,				June 30,
(in thousands)	2019		2020		2019		2020
Product revenue, net	$	—	$	(48)	$	—	$	108
Collaboration revenues		—		7		1,000		152
Research premium		351		301		744		591
Government grants		174		227		484		425
Total	$	525	$	487	$	2,228	$	1,276

The $1.0 million of collaboration revenue for the six months ended June 30, 2019 reflects the upfront payment under the Sunovion License Agreement received in April 2019 (see Note 11).

We sell our products to pharmaceutical wholesalers/distributors (i.e., our customers). Our wholesalers/distributors in turn sell our products directly to clinics, hospitals, and private practices. Revenue from our product sales is recognized as physical delivery of product occurs (when our customer obtains control of the product), in return for agreed-upon consideration.

For the three and six months ended June 30, 2020 product revenues, gross were $0.1 million and $0.4 million, respectively. Our product revenues, gross (i.e., delivered units multiplied by the contractual price per unit) are reduced by our corresponding gross-to-net (“GTN”) estimates, resulting in our reported “product revenues, net” in the

accompanying consolidated statements of operations. These GTN estimates are based upon information received from external sources (such as written or oral information obtained from our customers with respect to their period-end inventory levels and sales to end-users during the period), in combination with management’s informed judgments. Due to the inherent uncertainty of these estimates, the actual amount incurred may be materially above or below the amount initially estimated when product revenues are originally recorded, then requiring prospective adjustments to our reported product revenues, net.

The following tables summarizes gross-to-net (“GTN”) adjustments for the periods presented:

	Three Months Ended		Six Months Ended
(in thousands)	June 30, 2020		June 30, 2020
Product revenue, gross	$	149	$	398
GTN accruals
Chargebacks and cash discounts		5		13
Medicaid and Medicare rebates		18		46
Other returns, rebates, discounts and adjustments		35		92
Total GTN accruals		58		151
Product revenue		91		247
Adjustments to prior period accruals
Returns reserve (1)		(349)		(349)
GTN accrual adjustments		210		210
Product revenue, net	$	(48)	$	108

(1) The Company recorded a returns reserve adjustment for slow-moving inventory, representing 50% of XENLETA IV inventory held at our Specialty Distributors as of June 30, 2020.