Property and Equipment

12 Months Ended

Dec. 31, 2013

Note 6 – Property and Equipment

Property and equipment is comprised of the following:

	December 31,
(in thousands)	2013			2012

Manufacturing, laboratory & office equipment	$	8,383		$	7,775
Furniture & fixtures		816			816
Leasehold improvements		2,711			2,711
Subtotal		11,910			11,302
Accumulated depreciation and amortization		(10,254	)		(9,565	)
Property and equipment, net	$	1,656		$	1,737

Leasehold improvements primarily consist of construction of an analytical and development laboratory in our Warrington, Pennsylvania headquarters, which was completed in 2007. The activities conducted in our laboratory include release and stability testing of raw materials as well as preclinical, clinical and commercial drug product supply. We also perform development work with respect to our aerosolized and lyophilized dosage forms of our KL4 surfactant. In addition, in 2007, we built a microbiology laboratory at our manufacturing facility in Totowa, New Jersey, to support production of our drug product candidates. The microbiology laboratory will be amortized through the end of the lease term for our Totowa, New Jersey facility in June 2015.

Depreciation expense on property and equipment for the years ended December 31, 2013, 2012, and 2011 was $0.7 million, $0.9 million, and $1.3 million, respectively.

- Definition

The entire disclosure for long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale. Examples include land, buildings, machinery and equipment, and other types of furniture and equipment including, but not limited to, office equipment, furniture and fixtures, and computer equipment and software. This disclosure may include property plant and equipment accounting policies and methodology, a schedule of property, plant and equipment gross, additions, deletions, transfers and other changes, depreciation, depletion and amortization expense, net, accumulated depreciation, depletion and amortization expense and useful lives, income statement disclosures, assets held for sale and public utility disclosures.

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