J.Income Taxes

The following table summarizes our effective tax rate and income tax expense for the three and nine months ended September 30, 2015 and 2014 (in thousands except for percentages):


	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
Effective tax rate		41	%		—	%		27	%		—	%
Income tax benefit (expense)	$	14,130		$	—		$	(9,513)		$	—

For the three months ended September 30, 2015, we recognized an income tax benefit of $14.1 million, representing an effective tax rate of 41%. The difference between the expected statutory federal tax rate of 35% and the 41% effective tax rate for the three months ended September 30, 2015, was attributable to the impact of a valuation allowance release related to certain deferred tax assets and the impact of state income taxes, partially offset by non-deductible transaction costs associated with the acquisition of CBR and non-deductible contingent consideration expense associated with Lumara Health.

For the nine months ended September 30, 2015, we recognized income tax expense of $9.5 million, representing an effective tax rate of 27%. The difference between the expected statutory federal tax rate of 35% and the 27% effective tax rate for the nine months ended September 30, 2015, was attributable to the impact of a valuation allowance release related to certain deferred tax assets, partially offset by the impact of state income taxes, non-deductible transaction costs associated with the acquisition of CBR, and non-deductible contingent consideration expense associated with Lumara Health.

We did not recognize any income tax benefit or expense for the three or nine months ended September 30, 2014 as we were subject to a full valuation allowance due to our net operating loss position at those times.

During the three months ended September 30, 2015, we reduced our net deferred tax liabilities initially recorded at the time of the Lumara acquisition by $5.4 million. These adjustments were recorded to goodwill during the three months ended September 30, 2015, as they occurred within the acquisition measurement period. The decrease in net deferred tax liabilities was primarily attributable to an increase in net operating loss carryforwards expected to be utilized in future periods, which was partially offset by the tax impact of the Makena revenue reserve measurement period adjustments recorded during the nine months ended September 30, 2015.