Inventories

9 Months Ended

Sep. 30, 2017

Inventory Disclosure [Abstract]

Inventories

Note 4: Inventories

The Company uses the lower of first-in, first-out (“FIFO”) cost or market method of accounting for inventory.

Inventories consist of the following:	(in thousands)
	September 30, 2017		December 31, 2016
Inventory work-in-process, January 1	$	—	$	1,326
Production		—		—
Transfer to other assets		—		(1,326	)
Spoilage		—		—
Inventory work-in-process, end of period	$	—	$	—

Commercial sales of Alferon® will not resume until new batches of commercial filled and finished product are produced and released by the FDA. The Company will continue the validation of Alferon® production and production of new Alferon® API inventory when funding becomes available. While the facility is approved by the FDA under the Biological License Application (“BLA”) for Alferon®, this status will need to be reaffirmed by an FDA pre-approval inspection. The Company will also need the FDA’s approval to release commercial product once it has submitted satisfactory stability and quality release data.

Due to the Company extending the timeline of Alferon® production to an excess of one year, the Company reclassified Alferon® Work-In-Process inventory to other assets within the Company’s balance sheet. The Alferon® Work-In-Process inventory included an initial payment for fill and finish of $211,000. The Company believes that the benefits from this initial payment will no longer be realized and decided to expense it in the current period.