INVENTORIES

9 Months Ended

Sep. 30, 2011

Notes To Consolidated Financial Statement Abstract

INVENTORIES

11.       INVENTORIES

The Company primarily utilizes third parties to manufacture and package inventories held for sale, takes title to certain inventories once manufactured, and warehouses such goods until packaged for final distribution and sale. Inventories consist of salable products held at the Company's warehouses, as well as raw materials and components at the manufacturers' facilities, and are valued at the lower of cost or market using the first-in, first-out method. The Company provides valuation reserves for estimated obsolescence or unmarketable inventory in an amount equal to the difference between the cost of inventory and the estimated market value based upon assumptions about future demand and market conditions.

Inventory costs associated with products that have not yet received regulatory approval are capitalized if, in the view of the Company's management, there is probable future commercial use and future economic benefit. If future commercial use and future economic benefit are not considered probable, then costs associated with pre-launch inventory that has not yet received regulatory approval are expensed as research and development expense during the period the costs are incurred. As of September 30, 2011 and December 31, 2010, there wereno costs capitalized into inventory for products that had not yet received regulatory approval.

Inventories are as follows (in thousands):

	September 30, 2011		December 31, 2010
Raw materials	$	11,251	$	15,801
Work-in-process		3,343		3,236
Finished goods		19,837		24,838
Valuation reserve		(3,559)		(8,593)
Total inventories	$	30,872	$	35,282