XML 38 R16.htm IDEA: XBRL DOCUMENT v2.3.0.15
Construction in Progress
9 Months Ended
Sep. 30, 2011
Construction in Progress 
Construction in Progress
Note 9: Construction in Progress

Utilizing our Board of Directors approval of up to $4.4 million for full engineering studies, capital improvements, system upgrades and introduction of building management systems to enhance production of Alferon®, the project has progressed to the construction phase.  Construction in progress consists of accumulated costs for the construction and installation of capital improvements and process equipment within the Company's New Brunswick, New Jersey facility until the assets are placed into service.  As of December 31, 2010, construction in progress was $485,000 as compared to $1,213,000 as of September 30, 2011.  As of September 30, 2011, and including the construction in progress costs, approximately $1,156,000 has been spent on this project of the $4.4 million authorized by the Board.  The entire cost of this capital improvement project is currently being financed (see Note 10: Margin Account Loan).
 
The primary purpose of this upgrade is to significantly increase our production capacity for Alferon® API.  As expected in any construction project, we had experienced some delay due to permit issues, demolition concerns and design revisions.  Accordingly, we had used this time to pursue cost savings where possible, including locating and acquiring equipment from major U.S. pharmaceutical manufacturers that have recently curtailed or eliminated certain manufacturing activities or plants.  As a result, we have estimated a cost savings of approximately $827,000 to date for the project as compared to acquiring the equipment directly from the original manufacturer.