0001104659-20-025744 | 10-K | XBRL Viewer

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Document and Entity Information - USD ($) $ in Millions	12 Months Ended
Document and Entity Information - USD ($) $ in Millions	Dec. 31, 2019	Feb. 20, 2020	Jun. 30, 2019
Document Information [Line Items]
Document Type	10-K
Amendment Flag	false
Document Period End Date	Dec. 31, 2019
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	FY
Entity Registrant Name	ANI PHARMACEUTICALS INC
Entity Current Reporting Status	Yes
Entity Central Index Key	0001023024
Current Fiscal Year End Date	--12-31
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Emerging Growth Company	false
Entity Small Business	false
Entity Shell Company	false
Entity Public Float			$ 657.7
Class C Special Stock [Member]
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		10,864
Convertible Common Stock [Member]
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		12,096,556

Condensed Consolidated Balance Sheets - USD ($)	Dec. 31, 2019	Dec. 31, 2018
Current Assets
Cash and cash equivalents	$ 62,332,000	$ 43,008,000
Accounts receivable, net of $59,946 and $47,705 of adjustments for chargebacks and other allowances at December 31, 2019 and 2018, respectively	72,129,000	64,842,000
Inventories, net	48,163,000	40,503,000
Prepaid income taxes, net	1,076,000	0
Prepaid expenses and other current assets	3,995,000	4,524,000
Total Current Assets	187,695,000	152,877,000
Property and equipment, net	40,551,000	38,090,000
Restricted cash	5,029,000	5,021,000
Deferred tax assets, net of deferred tax liabilities and valuation allowance	38,326,000	27,964,000
Intangible assets, net	180,388,000	201,604,000
Goodwill	3,580,000	3,580,000
Other non-current assets	1,220,000	1,468,000
Total Assets	456,789,000	430,604,000
Current Liabilities
Current component of Term Loan and Delayed Draw Term Loan, net of deferred financing costs	9,941,000	3,256,000
Convertible Notes, net of discount and deferred financing costs	0	112,463,000
Accounts payable	14,606,000	8,884,000
Accrued expenses and other	2,362,000	1,707,000
Accrued royalties	5,084,000	8,456,000
Accrued compensation and related expenses	3,736,000	3,524,000
Current income taxes payable, net	0	5,022,000
Accrued government rebates	8,901,000	8,974,000
Returned goods reserve	16,595,000	12,552,000
Deferred revenue	451,000	711,000
Total Current Liabilities	61,676,000	165,549,000
Non-current Liabilities
Term Loan and Delayed Draw Term Loan, net of deferred financing costs and current component	175,808,000	67,296,000
Other non-current liabilities	6,514,000	496,000
Total Liabilities	243,998,000	233,341,000
Commitments and Contingencies (Note 12)
Stockholders' Equity
Common Stock, $0.0001 par value, 33,333,334 shares authorized; 12,104,875 shares issued and 12,089,565 outstanding at December 31, 2019; 11,862,508 shares issued and 11,851,329 shares outstanding at December 31, 2018	1,000	1,000
Class C Special Stock, $0.0001 par value, 781,281 shares authorized; 10,864 shares issued and outstanding at December 31, 2019 and 2018, respectively	0	0
Preferred Stock, $0.0001 par value, 1,666,667 shares authorized; 0 shares issued and outstanding at December 31, 2019 and 2018, respectively	0	0
Treasury stock, 15,310 shares of common stock, at cost, at December 31, 2019 and 11,179 shares of common stock, at cost, at December 31, 2018	(723,000)	(659,000)
Additional paid-in capital	200,800,000	186,812,000
Retained earnings	17,584,000	11,488,000
Accumulated other comprehensive loss, net of tax	(4,871,000)	(379,000)
Total Stockholders' Equity	212,791,000	197,263,000
Total Liabilities and Stockholders' Equity	$ 456,789,000	$ 430,604,000

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Adjustments for chargebacks and other allowances	$ 59,946	$ 47,705
Preferred Stock, Par or Stated Value Per Share (in dollars per share)	$ 0.0001	$ 0.0001
Preferred Stock, Shares Authorized	1,666,667	1,666,667
Preferred Stock, Shares Issued	0	0
Preferred Stock, Shares Outstanding	0	0
Treasury Stock, Common, Shares	15,310	11,179
Common Stock [Member]
Common Stock, Par Value (in dollars per share)	$ 0.0001	$ 0.0001
Common Stock, Authorized Shares	33,333,334	33,333,334
Common Stock, Issued Shares	12,104,875	11,862,508
Common Stock, Outstanding Shares	12,089,565	11,851,329
Class C Special Stock [Member]
Common Stock, Par Value (in dollars per share)	$ 0.0001	$ 0.0001
Common Stock, Authorized Shares	781,281	781,281
Common Stock, Issued Shares	10,864	10,864
Common Stock, Outstanding Shares	10,864	10,864

Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Condensed Consolidated Statements of Operations
Net Revenues	$ 206,547	$ 201,576	$ 176,842
Operating Expenses
Cost of sales (excluding depreciation and amortization)	63,154	73,024	79,032
Research and development	19,806	15,388	9,070
Selling, general, and administrative	55,843	44,063	31,580
Depreciation and amortization	44,612	33,742	27,928
Cortrophin pre-launch charges	6,706	0	0
Intangible asset impairment charge	75	0	903
Total Operating Expenses	190,196	166,217	148,513
Operating Income	16,351	35,359	28,329
Other Expense, net
Interest expense, net	(12,966)	(14,758)	(12,035)
Other (expense)/income, net	(228)	(550)	55
Income Before Benefit/(Provision) for Income Taxes	3,157	20,051	16,349
Benefit/(provision) for income taxes	2,937	(4,557)	(17,425)
Net Income	$ 6,094	$ 15,494	$ (1,076)
Basic and Diluted Earnings/(Loss) Per Share:
Basic Earnings/(Loss) Per Share	$ 0.51	$ 1.31	$ (0.09)
Diluted Earnings/(Loss) Per Share	$ 0.50	$ 1.30	$ (0.09)
Basic Weighted-Average Shares Outstanding	11,841	11,677	11,547
Diluted Weighted-Average Shares Outstanding	12,040	11,772	11,547

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Condensed Consolidated Statements of Comprehensive Income
Net income	$ 6,094	$ 15,494	$ (1,076)
Other comprehensive income/(loss), net of tax:
Change in fair value of interest rate swap, net of tax	(4,492)	(379)	0
Total other comprehensive loss, net of tax	(4,492)	(379)	0
Total comprehensive income/(loss), net of tax	$ 1,602	$ 15,115	$ (1,076)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References + Details

Condensed Consolidated Statements of Changes in Stockholders' Equity - USD ($)	Common Stock [Member] Scenario, Previously Reported [Member]	Common Stock [Member]	Class C Special Stock [Member] Scenario, Previously Reported [Member]	Class C Special Stock [Member]	Additional Paid-in Capital [Member] Scenario, Previously Reported [Member]	Additional Paid-in Capital [Member]	Treasury Stock [Member] Scenario, Previously Reported [Member]	Treasury Stock [Member]	Accumulated Other Comprehensive Loss, Net of Tax [Member] Scenario, Previously Reported [Member]	Accumulated Other Comprehensive Loss, Net of Tax [Member]	(Accumulated Deficit)/Retained Earnings [Member] Scenario, Previously Reported [Member]	(Accumulated Deficit)/Retained Earnings [Member]	Scenario, Previously Reported [Member]	Total
Balance at Dec. 31, 2016		$ 1		$ 0		$ 172,563,000		$ 0		$ 0		$ (2,916,000)		$ 169,648,000
Balance (in shares) at Dec. 31, 2016		11,589						0
Stock-based Compensation Expense		$ 0		0		6,090,000		$ 0		0		0		6,090,000
Changes in Treasury Stock Related to Stock-based Compensation Arrangements		$ 0		0		0		$ (259,000)		0		0		(259,000)
Changes in Treasury Stock Related to Stock-based Compensation Arrangements (in shares)		0					0	5
Issuance of Common Shares upon Stock Option and ESPP Exercise		$ 0		0		353,000		$ 0		0		0		353,000
Issuance of Common Shares upon Stock Option and ESPP Exercise (in shares)		17						0
Issuance of Restricted Stock Awards		$ 0		0		0		$ 0		0		0		0
Issuance of Restricted Stock Awards (in shares)		50						0
Change in fair value of interest rate swap, net of tax														0
Net Income		$ 0		0		0		$ 0		0		(1,076,000)		(1,076,000)
Balance at Dec. 31, 2017	$ 1	$ 1	$ 0	0	$ 172,577,000	179,020,000	$ 0	$ (259,000)	$ 0	0	$ (2,930,000)	(4,006,000)	$ 169,648,000	174,756,000
Balance (in shares) at Dec. 31, 2017	11,589	11,656						5
Cumulative Effect of Change in Accounting Principle		$ 0		0		14,000		$ 0		0		(14,000)		0
Stock-based Compensation Expense		0		0		6,782,000		0		0		0		6,782,000
Changes in Treasury Stock Related to Stock-based Compensation Arrangements		$ 0		0		0		$ (659,000)		0		0		(659,000)
Changes in Treasury Stock Related to Stock-based Compensation Arrangements (in shares)		0						11
Issuance of Common Shares upon Stock Option and ESPP Exercise		$ 0		0		2,719,000		$ 259,000		0		0		2,978,000
Issuance of Common Shares upon Stock Option and ESPP Exercise (in shares)		142						(5)
Issuance of Restricted Stock Awards		$ 0		0		0		$ 0		0		0		0
Issuance of Restricted Stock Awards (in shares)		65						0
Repurchase of Convertible Notes and Unwind of Call Option Overlay		$ 0		0		(1,709,000)		$ 0		0		0		(1,709,000)
Change in fair value of interest rate swap, net of tax		0		0		0		0		(379,000)		0		(379,000)
Net Income		0		0		0		0		0		15,494,000		15,494,000
Balance at Dec. 31, 2018		$ 1		0		186,812,000		$ (659,000)		(379,000)		11,488,000		197,263,000
Balance (in shares) at Dec. 31, 2018		11,863						11
Stock-based Compensation Expense		$ 0		0		9,217,000		$ 0		0		0		9,217,000
Changes in Treasury Stock Related to Stock-based Compensation Arrangements		$ 0		0		0		$ (1,031,000)		0		0		(1,031,000)
Changes in Treasury Stock Related to Stock-based Compensation Arrangements (in shares)		0						20
Issuance of Common Shares upon Stock Option and ESPP Exercise		$ 0		0		5,738,000		$ 0		0		0		5,738,000
Issuance of Common Shares upon Stock Option and ESPP Exercise (in shares)		136						0
Issuance of Restricted Stock Awards		$ 0		0		(967,000)		$ 967,000		0		0		0
Issuance of Restricted Stock Awards (in shares)		106						(16)
Change in fair value of interest rate swap, net of tax		$ 0		0		0		$ 0		(4,492,000)		0		(4,492,000)
Net Income		0		0		0		0		0		6,094,000		6,094,000
Balance at Dec. 31, 2019		$ 1		0		200,800,000		$ (723,000)		(4,871,000)		17,584,000		212,791,000
Balance (in shares) at Dec. 31, 2019		12,105						15
Cumulative Effect of Change in Accounting Principle		$ 0		$ 0		$ 0		$ 0		$ 0		$ 2,000		$ 2,000

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Cash Flows From Operating Activities
Net Income	$ 6,094	$ 15,494	$ (1,076)
Adjustments to reconcile net income/(loss) to net cash and cash equivalents provided by operating activities:
Stock-based compensation	9,217	6,782	6,090
Deferred taxes	(9,134)	(5,180)	3,560
Depreciation and amortization	44,612	33,742	27,928
Acquired product rights and in-process research and development ("IPR&D")	2,324	1,335	0
Non-cash interest relating to convertible notes and loan cost amortization	7,024	8,465	7,666
Loss on repurchase of Convertible notes	0	468	0
Intangible asset impairment charge	75	0	903
Changes in operating assets and liabilities:
Accounts receivable, net	(7,287)	(4,743)	(12,893)
Inventories, net	(7,660)	(379)	5,356
Prepaid expenses and other current assets	403	(1,142)	(17)
Accounts payable	5,039	3,466	3
Accrued royalties	(3,372)	(3,708)	(417)
Current income taxes, net	(6,098)	6,184	(3,560)
Accrued government rebates	(73)	1,044	2,039
Returned goods reserve	4,043	4,278	2,518
Accrued expenses, accrued compensation, and other	424	968	1,319
Net Cash and Cash Equivalents Provided by Operating Activities	45,631	67,074	39,419
Cash Flows From Investing Activities
Acquisition of WellSpring Pharma Services Inc., net of cash acquired	0	(16,467)	0
Acquisition of product rights, IPR&D, and other related assets	(20,914)	(5,169)	(97,624)
Acquisition of property and equipment, net	(6,635)	(5,743)	(10,369)
Net Cash and Cash Equivalents Used in Investing Activities	(27,549)	(27,379)	(107,993)
Cash Flows From Financing Activities
Payment of debt issuance and convertible debt repurchase costs	0	(1,572)	(2,737)
Payments on Term loan agreement	(2,707)	(2,813)	0
Borrowings under Term loan agreement	0	0	75,000
Borrowings under Delayed Draw Term Loan Agreement	118,000	0	0
Proceeds from stock option exercises and ESPP purchases	5,738	2,978	353
Repayment of Convertible Notes	(118,750)	(26,125)	0
Unwinding of portion of call option overlay, net	0	375	0
Treasury stock purchases for restricted stock vestings	(1,031)	(659)	(259)
Net Cash and Cash Equivalents Provided/(Used in) by Financing Activities	1,250	(27,816)	72,357
Net Change in Cash and Cash Equivalents	19,332	11,879	3,783
Cash, cash equivalents, and restricted cash, beginning of period	48,029	36,150	32,367
Cash, cash equivalents, and restricted cash, end of period	67,361	48,029	36,150
Reconciliation of cash, cash equivalents, and restricted cash, beginning of period
Cash and cash equivalents	43,008	31,144	27,365
Restricted cash	5,021	5,006	5,002
Cash, cash equivalents, and restricted cash, beginning of period	48,029	36,150	32,367
Reconciliation of cash, cash equivalents, and restricted cash, end of period
Cash and cash equivalents	62,332	43,008	31,144
Restricted cash	5,029	5,021	5,006
Cash, cash equivalents, and restricted cash, end of period	67,361	48,029	36,150
Supplemental disclosure for cash flow information:
Cash paid for interest, net of amounts capitalized	6,092	6,285	3,759
Cash paid for income taxes	10,033	6,397	17,786
Supplemental non-cash investing and financing activities:
Acquisition of marketing and distribution rights included in accounts payable	500	0	0
Property and equipment purchased and included in accounts payable	$ 723	$ 521	$ 485

DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Dec. 31, 2019

BUSINESS, PRESENTATION, AND RECENT ACCOUNTING PRONOUNCEMENTS

DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1. DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization and Business

ANI Pharmaceuticals, Inc. and its consolidated subsidiaries, ANIP Acquisition Company and ANI Pharmaceuticals Canada Inc. (together, “ANI,” the “Company,” “we,” “us,” or “our”) is an integrated specialty pharmaceutical company focused on delivering value to our customers by developing, manufacturing, and marketing high quality branded and generic prescription pharmaceuticals. ANI was organized as a Delaware corporation in April 2001. At our three facilities, of which two are located in Baudette, Minnesota and one is located in Oakville, Ontario, we manufacture oral solid dose products, as well as semi-solids, liquids and topicals, controlled substances, and potent products that must be manufactured in a fully-contained environment. We also perform contract manufacturing for other pharmaceutical companies.

On June 19, 2013, BioSante Pharmaceuticals, Inc. (“BioSante”) acquired ANIP Acquisition Company (“ANIP”) in an all-stock, tax-free reorganization (the “Merger”), in which ANIP became a wholly-owned subsidiary of BioSante. BioSante was renamed ANI Pharmaceuticals, Inc. The Merger was accounted for as a reverse acquisition pursuant to which ANIP was considered the acquiring entity for accounting purposes.

On August 6, 2018, our subsidiary, ANI Pharmaceuticals Canada Inc. (“ANI Canada”), acquired all the issued and outstanding equity interests of WellSpring Pharma Services Inc. (“WellSpring”), a Canadian company that performs contract development and manufacturing of pharmaceutical products for a purchase price of $18.0 million, subject to certain customary adjustments. Pursuant to these customary adjustments, the total purchase consideration was $16.7 million. The consideration was paid entirely from cash on hand. In conjunction with the transaction, we acquired WellSpring’s pharmaceutical manufacturing facility, laboratory, and offices, its current book of commercial business, as well as an organized workforce. Following the consummation of the transaction, WellSpring was merged into ANI Canada with the resulting entity’s name being ANI Pharmaceuticals Canada Inc.

Our operations are subject to certain risks and uncertainties including, among others, current and potential competitors with greater resources, dependence on significant customers, and possible fluctuations in financial results. The accompanying consolidated financial statements have been prepared assuming that we will continue as a going concern, which contemplates continuity of operations, realization of assets, and satisfaction of liabilities in the ordinary course of business. The propriety of using the going-concern basis is dependent upon, among other things, the achievement of future profitable operations, the ability to generate sufficient cash from operations, and potential other funding sources, including cash on hand, to meet our obligations as they become due. We believe the going-concern basis is appropriate for the accompanying consolidated financial statements based on our current operating plan and business strategy for the 12 months following the issuance of this report.

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Certain prior period information has been reclassified to conform to the current period presentation.

Principles of Consolidation

The consolidated financial statements include the accounts of ANI Pharmaceuticals, Inc. and its subsidiaries. All intercompany accounts and transactions are eliminated in consolidation.

Foreign Currency

We have a subsidiary located in Canada. The subsidiary conducts its transactions in U.S. dollars and Canadian dollars, but its functional currency is the U.S. dollar. The results of any non-U.S. dollar transactions are remeasured in U.S. dollars at the applicable exchange rates during the period and resulting foreign currency transaction gains and losses are included in the determination of net income. Our gain or loss on transactions denominated in foreign currencies was immaterial for the years ended December 31, 2019, 2018, and 2017. Unless otherwise noted, all references to “$” or “dollar” refer to the U.S. dollar.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. In the accompanying consolidated financial statements, estimates are used for, but not limited to, stock-based compensation, revenue recognition, allowance for doubtful accounts, variable consideration determined based on accruals for chargebacks, administrative fees and rebates, government rebates, returns and other allowances, allowance for inventory obsolescence, valuation of financial instruments and intangible assets, accruals for contingent liabilities, fair value of long-lived assets, income tax provision, deferred taxes and valuation allowance, determination of right-of-use assets and lease liabilities, purchase price allocations, and the depreciable lives of long-lived assets. Because of the uncertainties inherent in such estimates, actual results may differ from those estimates. Management periodically evaluates estimates used in the preparation of the financial statements for reasonableness.

Leases

At the inception of a contract we determine if the arrangement is, or contains, a lease. Right-of-use (“ROU”) assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. Rent expense is recognized on a straight-line basis over the lease term.

We have made certain accounting policy elections whereby we (i) do not recognize ROU assets or lease liabilities for short-term leases (those with original terms of 12-months or less) and (ii) combine lease and non-lease elements of our operating leases. Operating lease ROU assets are included in other non-current assets and operating lease liabilities are included in accrued expenses and other and other non-current liabilities in our consolidated balance sheets. As of December 31, 2019, we did not have any finance leases.

Comprehensive Income

Comprehensive income, which is reported in the statement of comprehensive income, consists of net income, changes in fair value of our interest rate swap, and other comprehensive income, net of tax.

Credit Concentration

Our customers are primarily wholesale distributors, chain drug stores, group purchasing organizations, and other pharmaceutical companies.

During the year ended December 31, 2019, three customers represented approximately 32%, 25%, and 23% of net revenues, respectively. As of December 31, 2019, accounts receivable from these customers totaled 88% of net accounts receivable. During the year ended December 31, 2018, three customers represented approximately 21%, 23%, and 33% of net revenues, respectively. During the year ended December 31, 2017, three customers represented approximately 29%, 29%, and 20% of net revenues, respectively.

Vendor Concentration

We source the raw materials for products, including active pharmaceutical ingredients (“API”), from both domestic and international suppliers. Generally, only a single source of API is qualified for use in each product due to the costs and time required to validate a second source of supply. As a result, we are dependent upon our current vendors to supply reliably the API required for ongoing product manufacturing. During the year ended December 31, 2019, we purchased approximately 13% of our inventory from one supplier. As of December 31, 2019, amounts payable to this supplier was $0.7 million. During the year ended December 31, 2018, we purchased approximately 13% of our inventory from one supplier. During the year ended December 31, 2017, we purchased approximately 23% of our inventory from two suppliers.

Revenue Recognition

On January 1, 2018, we adopted guidance for revenue recognition for contracts, using the modified retrospective method. The implementation of the guidance had no material impact on the measurement or recognition of revenue from customer contracts of prior periods. For our revenue recognition policies prior to adopting the guidance for revenue recognition for contracts, please see Item 8. Consolidated Financial Statements, Note 1, Description of Business and Summary of Significant Accounting Policies, in our Annual Report on Form 10‑K for the year ended December 31, 2017.

We recognize revenue using the following steps:

Identification of the contract, or contracts, with a customer;

Identification of the performance obligations in the contract;

Determination of the transaction price, including the identification and estimation of variable consideration;

Allocation of the transaction price to the performance obligations in the contract; and

Recognition of revenue when we satisfy a performance obligation.

We derive our revenues primarily from sales of generic and branded pharmaceutical products. Revenue is recognized when our obligations under the terms of our contracts with customers are satisfied, which generally occurs when control of the products we sell is transferred to the customer. We estimate variable consideration after considering applicable information that is reasonably available. We generally do not have incremental costs to obtain contracts that would otherwise not have been incurred. We do not adjust revenue for the promised amount of consideration for the effects of a significant financing component because our customers generally pay us within 100 days.

All revenue recognized in our consolidated statements of operations is considered to be revenue from contracts with customers. The following table depicts the disaggregation of revenue:


Products and Services	Years Ended December 31,
(in thousands)	2019		2018		2017
Sales of generic pharmaceutical products	$	128,729	$	117,451	$	118,437
Sales of branded pharmaceutical products		63,767		60,554		50,919
Sales of contract manufactured products		11,139		9,119		7,046
Royalties from licensing agreements		807		12,504		—
Product development services		1,125		1,019		—
Other(1)		980		929		440
Total net revenues	$	206,547	$	201,576	$	176,842

⁽¹⁾

Primarily includes laboratory services and royalties on sales of contract manufactured products


Timing of Revenue Recognition	Years Ended December 31,
(in thousands)	2019		2018		2017
Performance obligations transferred at a point in time	$	205,422	$	200,557	$	176,842
Performance obligations transferred over time		1,125		1,019		—
Total	$	206,547	$	201,576	$	176,842

During the year ended December 31, 2019, we did not incur, and therefore did not defer, any material incremental costs to obtain contracts. We recognized a decrease of $10.2 million of net revenue from performance obligations satisfied in prior periods during the year ended December 31, 2019, consisting primarily of revised estimates for variable consideration, including chargebacks, rebates, returns, and other allowances, related to prior period sales, partially offset by royalties from licensing agreements. We provide technical transfer services to customers, for which services are transferred over time. As a result, we had $0.1 million and $0.1 million of contract assets related to revenue recognized based on percentage of completion but not yet billed and $0.5 million and $0.7 million of deferred revenue at December 31, 2019 and 2018, respectively. We had no contract assets or deferred revenue at December 31, 2017. For the year ended December 31, 2019, we recognized $10.1 million of revenue that was included in deferred revenue as of December 31, 2018.

Revenue from Sales of Generic and Branded Pharmaceutical Products

Product sales consists of sales of our generic and brand pharmaceutical products. Our sole performance obligation in our contracts is to provide pharmaceutical products to customers. Our products are sold at pre-determined standalone selling prices and our performance obligation is considered to be satisfied when control of the product is transferred to the customer. Control is transferred to the customer upon delivery of the product to the customer, as our pharmaceutical products are sold on an FOB destination basis and because inventory risk and risk of ownership passes to the customer upon delivery. Payment terms for these sales are generally less than 100 days.

Revenue from Distribution Agreements

From time to time, we enter into marketing and distribution agreements with third parties in which we sell products under Abbreviated New Drug Applications (“ANDAs”) or New Drug Applications (“NDAs”) owned or licensed by these third parties. These products are sold under our own label. We have assessed and determined that we control the products sold under these marketing and distribution agreements and therefore are the principal for sales under each of these marketing and distribution agreements. As a result, we recognize revenue on a gross basis when control has passed to the customer and we have satisfied our performance obligation. Under these agreements, we pay these third parties a specified percentage of the gross profit earned on sales of the products. These profit-sharing percentages are recognized in cost of sales in our consolidated statements of operations and are accrued in accrued royalties in our consolidated balance sheets until payment has occurred.

Sales of our pharmaceutical products are subject to variable consideration due to chargebacks, government rebates, returns, administrative and other rebates, and cash discounts. Estimates for these elements of variable consideration require significant judgment.

Chargebacks

Chargebacks, primarily from wholesalers, result from arrangements we have with indirect customers establishing prices for products which the indirect customer purchases through a wholesaler. Alternatively, we may pre-authorize wholesalers to offer specified contract pricing to other indirect customers. Under either arrangement, we provide a chargeback credit to the wholesaler for any difference between the contracted price with the indirect customer and the wholesaler’s invoice price, typically Wholesale Acquisition Cost ("WAC").

Chargeback credits are calculated as follows:

Prior period chargebacks claimed by wholesalers are analyzed to determine the actual average selling price ("ASP") for each product. This calculation is performed by product by wholesaler. ASPs can be affected by several factors such as:

A change in customer mix

A change in negotiated terms with customers

A change in the volume of off-contract purchases

Changes in WAC

As necessary, we adjust ASPs based on anticipated changes in the factors above.

The difference between ASP and WAC is recorded as a reduction in both gross revenues in the consolidated statements of operations and accounts receivable in the consolidated balance sheets, at the time we recognize revenue from the product sale.

To evaluate the adequacy of our chargeback accruals, we obtain on-hand inventory counts from the wholesalers. This inventory is multiplied by the chargeback amount, the difference between ASP and WAC, to arrive at total expected future chargebacks, which is then compared to the chargeback accruals. We continually monitor chargeback activity and adjust ASPs when we believe that actual selling prices will differ from current ASPs.

Government Rebates

Our government rebates reserve consists of estimated payments due to governmental agencies for purchases made by third parties under various governmental programs. The two largest government programs that impact our net revenue and our government rebates reserve are federal and state Medicaid rebate programs and Medicare.

We participate in certain qualifying federal and state Medicaid rebate programs whereby discounts and rebates are provided to participating programs after the final dispensing of the product by a pharmacy to a Medicaid plan participant. Medicaid rebates are typically billed up to 120 days after the product is shipped. Medicaid rebate amounts per product unit are established by law, based on the Average Manufacturer Price (“AMP”), which is reported on a monthly and quarterly basis, and, in the case of branded products, best price, which is reported on a quarterly basis. Our Medicaid reserves are based on expected claims from state Medicaid programs. Estimates for expected claims are driven by patient usage, sales mix, calculated AMP or best price, as well as inventory in the distribution channel that will be subject to a Medicaid rebate. As a result of the delay between selling the products and rebate billing, our Medicaid rebate reserve includes both an estimate of outstanding claims for end-customer sales that have occurred but for which the related claim has not been billed, as well as an estimate for future claims that will be made when inventory in the distribution channel is sold through to plan participants.

Many of our products are also covered under Medicare. We, like all pharmaceutical companies, must provide a discount for any products sold under NDAs to Medicare Part D participants. This applies to all products sold under NDAs, regardless of whether the products are marketed as branded or generic. Our estimates for these discounts are based on historical experience with Medicare rebates for our products. While such experience has allowed for reasonable estimations in the past, history may not always be an accurate indicator of future rebates. Medicare rebates are typically billed up to 120 days after the product is shipped. As a result of the delay between selling the products and rebate billing, our Medicare rebate reserve includes both an estimate of outstanding claims for end-customer sales that have occurred but for which the related claim has not been billed, as well as an estimate for future claims that will be made when inventory in the distribution channel is sold through to Medicare Part D participants.

To evaluate the adequacy of our government rebate reserves, we review the reserves on a quarterly basis against actual claims data to ensure the liability is fairly stated. We continually monitor our government rebate reserve and adjust our estimates if we believe that actual government rebates may differ from our established accruals. Accruals for government rebates are recorded as a reduction to gross revenues in the consolidated statements of operations and as an increase to accrued government rebates in the consolidated balance sheets.

Returns

We maintain a return policy that allows customers to return product within a specified period prior to and subsequent to the expiration date. Generally, product may be returned for a period beginning six months prior to its expiration date to up to one year after its expiration date. Our product returns are settled through the issuance of a credit to the customer. Our estimate for returns is based upon historical experience with actual returns. While such experience has allowed for reasonable estimation in the past, history may not always be an accurate indicator of future returns. We continually monitor our estimates for returns and make adjustments when we believe that actual product returns may differ from the established accruals. Accruals for returns are recorded as a reduction to gross revenues in the consolidated statements of operations and as an increase to the return goods reserve in the consolidated balance sheets.

Administrative Fees and Other Rebates

Administrative fees or rebates are offered to wholesalers, group purchasing organizations, and indirect customers. We accrue for fees and rebates, by product by wholesaler, at the time of sale based on contracted rates and ASPs.

To evaluate the adequacy of our administrative fee accruals, we obtain on-hand inventory counts from the wholesalers. This inventory is multiplied by the ASPs to arrive at total expected future sales, which is then multiplied by contracted rates. The result is then compared to the administrative fee accruals. We continually monitor administrative fee activity and adjust our accruals when we believe that actual administrative fees will differ from the accruals. Accruals for administrative fees and other rebates are recorded as a reduction in both gross revenues in the consolidated statements of operations and accounts receivable in the consolidated balance sheets.

Prompt Payment Discounts

We often grant sales discounts for prompt payment. The reserve for prompt payment discounts is based on invoices outstanding. We assume, based on past experience, that all available discounts will be taken. Accruals for prompt payment discounts are recorded as a reduction in both gross revenues in the consolidated statements of operations and accounts receivable in the consolidated balance sheets.

The following table summarizes activity in the consolidated balance sheets for accruals and allowances for the years ended December 31, 2019, 2018, and 2017:


	Accruals for Chargebacks, Returns, and Other Allowances
							Administrative		Prompt
			Government				Fees and Other		Payment
(in thousands)	Chargebacks		Rebates		Returns		Rebates		Discounts
Balance at December 31, 2016	$	26,785	$	5,891	$	5,756	$	3,550	$	1,554
Accruals/Adjustments		179,297		12,237		12,184		24,037		8,126
Credits Taken Against Reserve		(177,852)		(10,198)		(9,666)		(22,361)		(7,846)
Balance at December 31, 2017	$	28,230	$	7,930	$	8,274	$	5,226	$	1,834
Accruals/Adjustments		229,813		11,383		14,243		33,167		9,371
Credits Taken Against Reserve		(219,036)		(10,339)		(9,965)		(31,040)		(9,196)
Balance at December 31, 2018	$	39,007	$	8,974	$	12,552	$	7,353	$	2,009
Accruals/Adjustments		260,771		17,549		19,105		36,874		10,789
Credits Taken Against Reserve		(249,896)		(17,622)		(15,062)		(35,946)		(10,249)
Balance at December 31, 2019	$	49,882	$	8,901	$	16,595	$	8,281	$	2,549

Contract Manufacturing Product Sales Revenue

Contract manufacturing arrangements consists of agreements in which we manufacture a pharmaceutical product on behalf of third party. Our performance obligation is to manufacture and provide pharmaceutical products to customers, typically pharmaceutical companies. The contract manufactured products are sold at pre-determined standalone selling prices and our performance obligations are considered to be satisfied when control of the product is transferred to the customer. Control is transferred to the customer when the product leaves our dock to be shipped to the customer, as our pharmaceutical products are sold on an FOB shipping point basis and the inventory risk and risk of ownership passes to the customer at that time. Payment terms for these sales are generally less than two months. We estimate returns based on historical experience. Historically, we have not had material returns for contract manufactured products.

As of December 31, 2019, the value of our unsatisfied performance obligations (or backlog) was $8.1 million, which consists of firm orders for contract manufactured products, for which our performance obligations remain unsatisfied and for which the related revenue has yet to be recognized. We anticipate satisfying these performance obligations within six months.

Royalties from Licensing Agreements

From time to time, we enter into transition agreements with the sellers of products we acquire, under which we license to the seller the right to sell the acquired products. Therefore, we recognize the revenue associated with sales of the underlying products as royalties. Because these royalties are sales-based, we recognize the revenue when the underlying sales occur, based on sales and gross profit information received from the sellers. Upon full transition of the products and upon launching the products under our own labels, we recognize revenue for the products as sales of generic or branded pharmaceutical products, as described above.

We receive royalties from a license for patent rights initially owned by Cell Genesys, Inc., which merged with BioSante in 2009. The royalties are the results of sales and milestones related to the Yescarta® product. We recognize revenue for sales-based royalties when the underlying sales occur. We estimate variable consideration related to milestones, which requires significant judgment.

Product Development Services Revenue

We provide product development services to customers, which are performed over time. These services primarily relate to the technical transfer of product development to our facility in Oakville, Ontario. The duration of these technical transfer projects can be up to three years. Deposits received from these customers are recorded as deferred revenue until revenue is recognized. For contracts with no deposits and for the remainder of contracts with deposits, we invoice customers as our performance obligations are satisfied. We recognize revenue on a percentage of completion basis, which results in contract assets on our balance sheet. As of December 31, 2019, the value of our unsatisfied performance obligations for product development services contracts was $1.3 million. We expect to satisfy these performance obligations in the next 6 to 15 months.

Cash, Cash Equivalents, and Restricted Cash

We consider all highly liquid instruments with maturities of three months or less when purchased to be cash equivalents. All interest bearing and non-interest bearing accounts are guaranteed by the Federal Deposit Insurance Corporation (“FDIC”) up to $250 thousand. The majority of our cash balances are in excess of FDIC coverage. We consider this to be a normal business risk.

In April 2016, we purchased the rights, title, and interest in the NDA for Inderal LA, as well as certain documentation, trademark rights, and finished goods from Cranford Pharmaceuticals, LLC for $60.0 million in cash and milestone payments based on future gross profits from sales of products under the NDA. Additionally, we transferred $5.0 million to an escrow account as security for future milestone payments. This escrow account balance is included in restricted cash in our accompanying consolidated balance sheet as of December 31, 2019.

Accounts Receivable

We extend credit to customers on an unsecured basis. We use the allowance method to provide for doubtful accounts based on our evaluation of the collectability of accounts receivable, whereby we provide an allowance for doubtful accounts equal to the estimated uncollectible amounts. Our estimate is based on historical collection experience and a review of the current status of trade accounts receivable. We determine trade receivables to be delinquent when greater than 30 days past due. Receivables are written off when it is determined that amounts are uncollectible. Our allowance for doubtful accounts was immaterial as of December 31, 2019 and 2018.

Inventories

Inventories consist of raw materials, packaging materials, work-in-progress, and finished goods. Inventories are stated at the lower of standard cost or net realizable value. We periodically review and adjust standard costs, which generally approximate weighted average cost. In the fourth quarter of 2019, we recognized inventory reserve charges of $4.6 million, primarily related to our exiting from the market of Methylphenidate Extended Release.

Property and Equipment

Property and equipment are recorded at cost. Expenditures for repairs and maintenance are charged to expense as incurred. Depreciation is recorded on a straight-line basis over estimated useful lives as follows:


Buildings and improvements	20 - 40 years
Machinery, furniture, and equipment	1 - 10 years

Construction in progress consists of multiple projects, primarily related to new equipment to expand our manufacturing capability as our product lines continue to grow. Construction in progress includes the cost of construction and other direct costs attributable to the construction, along with capitalized interest. Depreciation is not recorded on construction in progress until such time as the assets are placed in service.

We review property and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of the long-lived asset is measured by a comparison of the carrying amount of the asset to future undiscounted net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the estimated fair value of the assets. No impairment loss related to property and equipment was recognized during the years ended December 31, 2019, 2018, and 2017. Assets held for disposal are reportable at the lower of the carrying amount or fair value, less costs to sell. No assets were held for disposal as of December 31, 2019 and 2018.

Intangible Assets

Intangible assets other than goodwill consist of acquired ANDAs for previously commercialized and marketed drug products, acquired approved ANDAs for generic products yet to be commercialized, an acquired development package for a generic drug product, a license, supply and distribution agreement for a generic drug product, acquired product rights for generic products, acquired NDAs and product rights for branded products, acquired marketing and distribution rights, and a non-compete agreement.

The ANDAs, NDAs and product rights, marketing and distribution rights, and non-compete agreement are amortized over their remaining estimated useful lives, ranging from four to 10 years, based on the straight-line method. Management reviews definite-lived intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable, in a manner similar to that for property and equipment. During the year ended December 31, 2019, we recognized an impairment charge of $75 thousand relating to our Ranitidine product right asset (Note 7). No impairment losses related to intangible assets were recognized in the year ended December 31, 2018. During the year ended December 31, 2017, we recognized impairment charges of $0.9 million in relation to our testosterone gel NDA asset (Note 7).

Goodwill

Goodwill relates to the Merger and the acquisition of WellSpring and represents the excess of the total purchase consideration over the fair value of acquired assets and assumed liabilities, using the purchase method of accounting. Goodwill is not amortized, but is subject to periodic review for impairment. Goodwill is reviewed for impairment annually, as of October 31, and whenever events or changes in circumstances indicate that the carrying amount of the goodwill might not be recoverable. We perform our review of goodwill on our one reporting unit.

Before employing detailed impairment testing methodologies, we first evaluate the likelihood of impairment by considering qualitative factors relevant to our reporting unit. When performing the qualitative assessment, we evaluate events and circumstances that would affect the significant inputs used to determine the fair value of the goodwill. Events and circumstances evaluated include: macroeconomic conditions that could affect us, industry and market considerations for the generic pharmaceutical industry that could affect us, cost factors that could affect our performance, our financial performance (including share price), and consideration of any company-specific events that could negatively affect us, our business, or the fair value of our business. If we determine that it is more likely than not that goodwill is impaired, we will then apply detailed testing methodologies. Otherwise, we will conclude that no impairment has occurred.

Detailed impairment testing involves comparing the fair value of our one reporting unit to its carrying value, including goodwill. Fair value reflects the price a market participant would be willing to pay in a potential sale of ANI. If the fair value exceeds carrying value, then it is concluded that no goodwill impairment has occurred. If the carrying value of the reporting unit were to exceed its fair value, we would recognize an impairment charge for the amount by which the carrying amount exceeded the reporting unit’s fair value. The loss recognized would not exceed the total amount of goodwill allocated to that reporting unit. No impairment loss related to goodwill was recognized in the years ended December 31, 2019, 2018, and 2017.

Collaborative Arrangements

At times, we have entered into arrangements with various commercial partners to further business opportunities. In collaborative arrangements such as these, when we are actively involved and exposed to the risks and rewards of the activities and are determined to be the principal participant in the collaboration, we classify third party costs incurred and revenues in the consolidated statements of operations on a gross basis. Otherwise, third party revenues and costs generated by collaborative arrangements are presented on a net basis. Payments between us and the other participants are recorded and classified based on the nature of the payments.

Royalties

We have entered profit-sharing arrangements with third parties in which we sell products under ANDAs or NDAs owned or licensed by these third parties. Under these agreements, we pay these third parties a specified percentage of the gross profit earned on sales of the products. These profit-sharing percentages are recorded in cost of sales in our consolidated statements of operations when the associated revenue is recognized and are recorded in accrued royalties in our consolidated balance sheets when the associated revenue is recognized and until payment has occurred.

Research and Development Expenses

Research and development costs are expensed as incurred and primarily consist of expenses relating to product development. Research and development costs totaled $19.8 million, $15.4 million, and $9.1 million for the years ended December 31, 2019, 2018, and 2017, respectively.

Stock-Based Compensation

We have a stock-based compensation plan that includes stock options and restricted stock, which are awarded in exchange for employee and non-employee director services. Stock-based compensation cost for stock options is determined at the grant date using an option pricing model and stock-based compensation cost for restricted stock is based on the closing market price of the stock at the grant date. The value of the award is recognized as expense on a straight-line basis over the employee’s requisite service period and classified where the underlying salaries are classified. We also account for forfeitures as they occur rather than using an estimated forfeiture rate. We recognize excess tax benefits or tax deficiencies as a component of our current period provision for income taxes.

In addition, in July 2016, we commenced administration of our Employee Stock Purchase Plan (“ESPP”). We recognize the estimated fair value of stock-based compensation awards and classify the expense where the underlying salaries are classified.

We incurred $9.1 million, $6.7 million, and $6.1 million of non-cash, stock-based compensation cost for the years ended December 31, 2019, 2018, and 2017, respectively, and $147 thousand, $102 thousand, and $68 thousand of the 2019, 2018, and 2017 expense related to the ESPP, respectively.

Valuation of stock awards requires us to make assumptions and to apply judgment to determine the fair value of the awards. These assumptions and judgments include estimating the future volatility of our stock price and dividend yields. Changes in these assumptions can affect the fair value estimate.

Income Taxes

We use the asset and liability method of accounting for income taxes. Deferred tax assets and liabilities are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that such tax rate changes are enacted.

During the second quarter of 2019, we adopted an intercompany transfer pricing policy that uses the “comparable profits method” for pricing intercompany services between ANI Pharmaceuticals, Inc. and ANI Canada. For U.S. and Canadian tax purposes, the policy was adopted in conjunction with the acquisition date of August 6, 2018.

The measurement of a deferred tax asset is reduced, if necessary, by a valuation allowance if it is more likely than not that some portion or all of the deferred tax asset will not be realized. We have provided a valuation allowance against certain of our state net operating loss (“NOL”) carryforwards that are not expected to be used during the carryforward periods. As of December 31, 2018, we had provided a valuation allowance against ANI Canada’s net deferred tax assets of $1.9 million and against certain of our state net operating loss (“NOL”) carryforwards that are not expected to be used during the carryforward periods of $0.3 million. As a result of the newly adopted transfer pricing policy, our assessment of the amount of ANI Canada’s deferred tax assets that are more likely than not to be realized changed. As a result, during the second quarter 2019, we released ANI Canada’s valuation allowance and, as a result, our valuation allowance at December 31, 2019 of $0.4 million relates solely to our state NOL carryforwards.

We have not provided for deferred taxes related to any difference between the tax basis in the shares of ANI Canada and the financial reporting basis in those shares since it has the intent and ability to indefinitely reinvest ANI Canada’s earnings and not repatriate those earnings.

We use a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. We have not identified any uncertain income tax positions that could have a material impact on the consolidated financial statements.

We recognize interest and penalties accrued on any unrecognized tax exposures as a component of income tax expense; we did not have any such amounts accrued as of December 31, 2019, 2018, and 2017. We are subject to taxation in various U.S. jurisdictions and Canada and all of our income tax returns remain subject to examination by tax authorities due to the availability of NOL carryforwards.

We consider potential tax effects resulting from discontinued operations and for gains and losses in other comprehensive income and record intra-period tax allocations, when those effects are deemed material. In 2019 and 2018, we entered in an interest rate swap agreements (Note 4) that we designated as cash flow hedges designed to manage exposure to changes in LIBOR-based interest rate underlying our secured Term Loan (the "Term Loan") and Delayed Draw Term Loan ("DDTL") with Citizen’s Bank., N.A. Due to the effective nature of the hedge, the initial fair value of the hedge and subsequent changes in the fair value of the hedge are recognized in accumulated other comprehensive loss, net of tax in the accompanying consolidated balance sheets. Income taxes are allocated to the hedge component of accumulated other comprehensive income based on appropriate intra-period tax allocations when those effects are deemed material.

Earnings (Loss) per Share

Basic earnings (loss) per share is computed by dividing net income available to common shareholders by the weighted-average number of shares of common stock outstanding during the period.

For periods of net income, and when the effects are not anti-dilutive, we calculate diluted earnings (loss) per share by dividing net income available to common shareholders by the weighted-average number of shares outstanding plus the impact of all potential dilutive common shares, consisting primarily of common stock options, shares to be purchased under our ESPP, unvested restricted stock awards, stock purchase warrants, and any conversion gain on the Notes, using the treasury stock method. For periods of net loss, diluted loss per share is calculated similarly to basic loss per share because the impact of all dilutive potential common shares is anti-dilutive.

Our unvested restricted shares and certain of our outstanding warrants contain non-forfeitable rights to dividends, and therefore are considered to be participating securities; in periods of net income, the calculation of basic and diluted earnings (loss) per share excludes from the numerator net income (but not net loss) attributable to the unvested restricted shares and to the participating warrants, and excludes the impact of those shares from the denominator.

For purposes of determining diluted earnings (loss) per share, we elected a policy that the principal portion of our 3.0% Convertible Senior Notes that matured on December 1, 2019 (the “Notes,” Note 3) was settled in cash. As such, the principal portion of the Notes had no effect on either the numerator or denominator when determining diluted earnings (loss) per share. Any conversion gain was assumed to be settled in shares and was incorporated in diluted earnings (loss) per share using the treasury method. This policy was consistent with our election for settlement of the Notes under the First Supplemental Indenture to the Notes. The warrants issued in conjunction with the issuance of the Notes were considered to be dilutive when they were in-the-money relative to our average stock price during the period; the bond hedge purchased in conjunction with the issuance of the Notes was always considered to be anti-dilutive.

The numerator for earnings per share for the years ended December 31, 2019, 2018, and 2017 are calculated for basic and diluted earnings (loss) per share as follows:


	Basic						Diluted
(in thousands, except per share amounts)	Years Ended December 31,						Years Ended December 31,
	2019		2018		2017		2019		2018		2017
Net income/(loss)	$	6,094	$	15,494	$	(1,076)	$	6,094	$	15,494	$	(1,076)
Net income allocated to restricted stock		(97)		(154)		—		(97)		(154)		—
Net income/(loss) allocated to common shares	$	5,997	$	15,340	$	(1,076)	$	5,997	$	15,340	$	(1,076)
Basic Weighted-Average Shares Outstanding		11,841		11,677		11,547		11,841		11,677		11,547
Dilutive effect of stock options and ESPP								103		95		—
Dilutive effect of Notes								96		—		—
Diluted Weighted-Average Shares Outstanding								12,040		11,772		11,547
Earnings/(Loss) per share	$	0.51	$	1.31	$	(0.09)	$	0.50	$	1.30	$	(0.09)

The number of anti-dilutive shares, which have been excluded from the computation of diluted earnings (loss) per share, including the shares underlying the Notes, were 3.0 million, 4.4 million, and 4.8 million for the years ended December 31, 2019, 2018, and 2017, respectively. Due to the net loss in the year ended December 31, 2017, all dilutive potential common shares were also excluded from the diluted loss per share calculation, as the impact of those potential common shares is anti-dilutive in the case of a net loss. Anti-dilutive shares consist of out-of-the-money Class C Special stock, out-of-the-money common stock options, common stock options that are anti-dilutive when calculating the impact of the potential dilutive common shares using the treasury stock method, underlying shares related to out-of-the-money bonds issued as convertible debt, and out-of-the-money warrants exercisable for common stock.

Hedge Accounting

On January 1, 2018, we adopted guidance intended to simplify hedge accounting by better aligning how an entity’s risk management activities and hedging relationships are presented in its financial statements. The guidance also simplified the application of hedge accounting guidance in certain situations. The adoption of this guidance did not have a material impact on our consolidated financial statements. However, the adoption of this guidance did impact how we accounted for the interest rate swaps we entered into in April 2018, December 2018, and February 2019. See Note 4 for further details regarding the interest rate swap.

At times we use derivative financial instruments to hedge our exposure to interest rate risks. All derivative financial instruments are recognized as either assets or liabilities at fair value on the consolidated balance sheet and are classified as current or non-current based on the scheduled maturity of the instrument.

When we enter into a hedge arrangement and intend to apply hedge accounting, we formally document the hedge relationship and designate the instrument for financial reporting purposes as a fair value hedge, a cash flow hedge, or a net investment hedge. When we determine that a derivative financial instrument qualifies as a cash flow hedge and is effective, the changes in fair value of the instrument are recorded in accumulated other comprehensive income/(loss), net of tax in our consolidated balance sheets and will be reclassified to earnings when the hedged item affects earnings.

Fair Value of Financial Instruments

Our consolidated balance sheets include various financial instruments (primarily cash and cash equivalents, prepaid expenses, accounts receivable, accounts payable, accrued expenses, and other current liabilities) that are carried at cost and that approximate fair value. Fair value is the price that would be received from the sale of an asset or paid to transfer a liability assuming an orderly transaction in the most advantageous market at the measurement date. U.S. GAAP establishes a hierarchical disclosure framework which prioritizes and ranks the level of observability of inputs used in measuring fair value. These tiers include:

Level 1—Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.

Level 2—Observable market-based inputs other than quoted prices in active markets for identical assets or liabilities.

Level 3—Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs.

See Note 8 for additional information regarding fair value.

Geographic Information

Based on the distinct nature of our operations, our internal management structure, and the financial information that is evaluated regularly by our Chief Operating Decision Maker, we determined that we operate in one reportable segment. Our operations are located in the United States and Canada. The majority of the assets of the Company are located in the United States.

The following table depicts the Company’s revenue by geographic operations during the following periods:


(in thousands)	Years Ended December 31,
Location of Operations	2019		2018		2017
United States	$	199,663	$	196,886	$	176,842
Canada		6,884		4,690		—
Total Revenue	$	206,547	$	201,576	$	176,842

The following table depicts the Company’s property and equipment, net according to geographic location as of:


(in thousands)	December 31,		December 31,
	2019		2018
United States	$	26,708	$	24,437
Canada		13,843		13,653
Total property and equipment, net	$	40,551	$	38,090

Recent Accounting Pronouncements

Recent Accounting Pronouncements Not Yet Adopted

In November 2019, the Financial Accounting Standards Board (“FASB”) issued guidance simplifying the accounting for income taxes by removing the following exceptions: 1) exception to the incremental approach for intraperiod tax allocation when there is a loss from continuing operations and income or a gain from other items, 2) exception requirement to recognize a deferred tax liability for equity method investments when a foreign subsidiary becomes and equity method investment, 3) exception to the ability not to recognize a deferred tax liability for a foreign subsidiary when a foreign equity method investment becomes a subsidiary, and 4) exception to the general methodology for calculating income taxes in an interim period when a year-to-date loss exceeds the anticipated loss the year. The amendments also simplify accounting for income taxes by doing the following: 1) requiring that an entity recognize a franchise tax or similar tax that is partially based on income as an income-based tax and account for any incremental amount incurred as a non-income-based tax, 2) requiring that an entity evaluate when a step up in the tax basis of goodwill should be considered part of the business combination in which the book goodwill was originally recognized and when it should be considered a separate transaction, 3) specifying that an entity is not required to allocate the consolidated amount of current and deferred tax expense to a legal entity that is not subject to tax in its separate financial statements, 4) requiring that an entity reflect the effect of an enacted change in tax laws or rates in the annual effective tax rate computation in the interim period that includes the enactment date, and 5) making minor Codification improvements for income taxes related to employee stock ownership plans and investments in qualified affordable housing projects accounted for using the equity method. The guidance is effective for reporting periods beginning after December 15, 2020, including interim periods within that fiscal year. Early adoption is permitted, including adoption in an interim period. We are currently evaluating the impact, if any, that the adoption of this guidance will have on our consolidated financial statements.

In November 2018, the FASB issued guidance clarifying that certain transactions between collaborative arrangement participants should be accounted for as revenue under Accounting Standards Codification Topic 606 when the collaborative arrangement participant is a customer in the context of a unit of account. The guidance is effective for reporting periods beginning after December 15, 2019, including interim periods within that fiscal year. Early adoption is permitted, including adoption in an interim period. We will adopt this guidance as of January 1, 2020. The adoption of this guidance is not expected to have a material impact on our consolidated financial statements.

In August 2018, the FASB issued guidance amending the disclosure requirements on fair value measurements. The amendments add, modify, and eliminate certain disclosure requirements on fair value measurements. The guidance is effective for reporting periods beginning after December 15, 2019, including interim periods within that fiscal year. Early adoption is permitted, including adoption in an interim period.

We will adopt this guidance as of January 1, 2020. The adoption of this guidance is not expected to have a material impact on our consolidated financial statements.

In June 2016, the FASB issued guidance with respect to measuring credit losses on financial instruments, including trade receivables. The guidance eliminates the probable initial recognition threshold that was previously required prior to recognizing a credit loss on financial instruments. The credit loss estimate can now reflect an entity’s current estimate of all future expected credit losses. Under the previous guidance, an entity only considered past events and current conditions. In April 2019, the FASB further clarified the scope of the credit losses standard and addressed issues related to accrued interest receivable balances, recoveries, variable interest rates, and prepayment. In May 2019, the FASB issued further guidance to provide entities with an option to irrevocably elect the fair value option applied on an instrument-by-instrument basis for eligible financial instruments. In November 2019, the FASB issued further guidance on expected recoveries for purchased financial assets with credit deterioration, and transition refiled for troubled debt restructurings, disclosures related to accrued interest receivables, financial assets secured by collateral maintenance provisions. The guidance is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The adoption of certain amendments of this guidance must be applied on a modified retrospective basis and the adoption of the remaining amendments must be applied on a prospective basis. We currently expect that the adoption of this guidance may change the way we assess the collectability of our receivables and recoverability of other financial instruments. We will adopt this guidance as of January 1, 2020. The adoption of this guidance is not expected to have a material impact on our consolidated financial statements.

We have evaluated all other issued and unadopted Accounting Standards Updates and believe the adoption of these standards will not have a material impact on our consolidated statements of operations, comprehensive income, balance sheets, or cash flows.

Recently Adopted Accounting Pronouncements

In October 2018, the FASB issued guidance for accounting for derivatives and hedging. The guidance provides for the inclusion of the Secured Overnight Financing Rate ("SOFR") Overnight Index swap rate as a benchmark interest rate for hedge accounting purposes. In July 2017, the Financial Conduct Authority in the United Kingdom announced that it would phase out London Interbank Offered Rate ("LIBOR") as a benchmark by the end of 2021. As a result, the U.S. Federal Reserve identified the SOFR as its preferred alternative reference rate, calculated with a broad set of short-term repurchase agreements backed by treasury securities. Amounts drawn under our five-year senior secured credit facility bear interest rates in relation to LIBOR, and our interest rate swaps are designated in LIBOR. The guidance was effective for reporting periods beginning after December 15, 2018. We adopted this guidance as of January 1, 2019 on a prospective basis. The adoption of this guidance did not have a material impact on our consolidated financial statements.

In August 2018, the Securities and Exchange Commission (“SEC”) adopted the final rule amending certain disclosure requirements that have become redundant, duplicative, overlapping, outdated, or superseded. In addition, the amendments expand the disclosure requirements on the analysis of stockholders’ equity for interim financial statements. Under the amendments, an analysis of changes in each caption of stockholders’ equity presented in the balance sheet must be provided in a note or separate statement. The rule was effective on November 5, 2018 and was effective for the quarter that began after the effective date. The adoption of this guidance resulted in the inclusion of the statement of changes stockholder’s equity in our interim financial statement filings.

In June 2018, the FASB issued guidance simplifying the accounting for nonemployee stock-based compensation awards. The guidance aligns the measurement and classification for employee stock-based compensation awards to nonemployee stock-based compensation awards. Under the guidance, nonemployee awards are measured at their grant date fair value. Upon transition, the existing nonemployee awards are measured at fair value as of the adoption date. The guidance was effective for reporting periods beginning after December 15, 2018, including interim periods within that fiscal year. We adopted this guidance as of January 1, 2019. The adoption of this guidance did not have a material impact on our consolidated financial statements.

In February 2016, the FASB issued guidance for accounting for leases. The guidance requires lessees to recognize assets and liabilities related to long-term leases on the balance sheet and expands disclosure requirements regarding leasing arrangements. In July 2018, the FASB issued additional guidance, which offers a transition option to entities adopting the new lease standards. Under the transition option, entities can elect to apply the new guidance using a modified retrospective approach at the beginning of the year in which the new lease standard is adopted, rather than to the earliest comparative period presented in their financial statements. The guidance was effective for reporting periods beginning after December 15, 2018. We adopted this guidance on a modified retrospective basis effective January 1, 2019, using the following allowable practical expedients:

We did not reassess if any expired or existing contracts are or contain leases;

We did not reassess the classification of any expired or existing leases.

Additionally, we made ongoing accounting policy elections whereby we (i) do not recognize right-of-use assets or lease liabilities for short-term leases (those with original terms of 12-months or less) and (ii) combine lease and non-lease elements of our operating leases.

Upon adoption of the new guidance on January 1, 2019, we recognized a right-of-use asset of approximately $0.5 million, which was reduced by approximately $10 thousand of net prepaid rents at the date of adoption, along with a lease liability of approximately $0.5 million. We also recognized total deferred tax assets of approximately $0.1 million and deferred tax liabilities of approximately $0.1 million related to book-tax basis differences. The net effect of the adoption resulted in a cumulative effect adjustment to retained earnings on January 1, 2019 of approximately $2 thousand.

BUSINESS COMBINATION

12 Months Ended

Dec. 31, 2019

BUSINESS COMBINATION

BUSINESS COMBINATION

2. BUSINESS COMBINATION

Summary

On August 6, 2018, our subsidiary, ANI Canada, acquired all the issued and outstanding equity interests of WellSpring, a Canadian company that performs contract development and manufacturing of pharmaceutical products for a purchase price of $18.0 million, subject to certain customary adjustments. Pursuant to these customary adjustments, the total purchase consideration was $16.7 million. The consideration was paid entirely from cash on hand. In conjunction with the transaction, we acquired WellSpring’s pharmaceutical manufacturing facility, laboratory, and offices, its current book of commercial business, as well as an organized workforce. Following the consummation of the transaction, WellSpring was merged into ANI Canada with the resulting entity’s name being ANI Pharmaceuticals Canada Inc.

We acquired WellSpring to provide an additional tech transfer site in order to accelerate the re-commercialization of the previously-approved ANDAs in our pipeline, to expand our contract manufacturing revenue base, and to broaden our manufacturing capabilities to three manufacturing facilities.

Transaction Costs

In conjunction with the acquisition, we incurred approximately $1.1 million in transaction costs, all of which were expensed in 2018.

Purchase Consideration and Net Assets Acquired

The business combination was accounted for using the acquisition method of accounting, with ANI as the accounting acquirer of WellSpring. The acquisition method requires that acquired assets and assumed liabilities be recorded at their fair values as of the acquisition date.

The following presents the final allocation of the purchase price to the assets acquired and liabilities assumed on August 6, 2018:


	(in thousands)
Total Purchase Consideration	$	16,687
Cash and cash equivalents		220
Accounts receivable		1,311
Inventories		2,197
Prepaid expenses and other current assets		361
Property and equipment		13,935
Goodwill		1,742
Total assets acquired		19,766
Accounts payable and other current liabilities		2,413
Deferred revenue		666
Total liabilties assumed		3,079
Net assets acquired	$	16,687

The net assets were recorded at their estimated fair value. In valuing acquired assets and liabilities, fair value estimates were based primarily on future expected cash flows, market rate assumptions for contractual obligations, and appropriate discount rates.

Goodwill is considered an indefinite-lived asset and relates primarily to intangible assets that do not qualify for separate recognition, such as the assembled workforce and synergies between the entities. Goodwill established as a result of the acquisition is not tax deductible in any taxing jurisdiction. There was no value ascribed to any separately identifiable intangible assets.

Legacy WellSpring operations generated $6.9 million of revenue and recorded a net loss of $5.2 million for the year ended December 31, 2019.

Pro Forma Condensed Combined Financial Information (unaudited)

The following unaudited pro forma condensed combined financial information summarizes the results of operations for the periods indicated as if the WellSpring acquisition had been completed as of January 1, 2017.


	Years Ended December 31,
(in thousands)	2018		2017(1)
Net revenues	$	208,213	$	188,758
Net income/(loss)	$	13,287	$	(3,102)

⁽¹⁾

Net loss for the year ended December 31, 2017 includes the impact to WellSpring of $4.4 million of related party debt forgiveness.

INDEBTEDNESS

12 Months Ended

Dec. 31, 2019

INDEBTEDNESS

INDEBTEDNESS

3. INDEBTEDNESS

Credit Facility

On December 27, 2018, we refinanced our $125.0 million Credit Agreement by entering into an amended and restated Senior Secured Credit Facility (the “Credit Facility”) for up to $265.2 million. The principal new feature of the Credit Facility was a $118.0 million DDTL, which could only be drawn on in order to pay down the Company’s remaining 3.0% Convertible Senior Notes, which matured on December 1, 2019. The Credit Facility (and specifically the DDTL) has a subjective acceleration clause in case of a material adverse event. The Credit Facility also extended the maturity of the $72.2 million Term Loan to December 2023. In addition, the Credit Facility increased the previous $50.0 million line of credit (the “Revolver”) to $75.0 million. Also on December 27, 2018, we entered into an interest rate swap arrangement to manage our exposure to changes in LIBOR-based interest rates underlying our refinanced Term Loan (Note 4). The Term Loan includes a repayment schedule, pursuant to which $4.5 million of the loan will be paid in quarterly installments during 2020. As of December 31, 2019, $4.5 million of the loan is recorded as current borrowings in the accompanying consolidated balance sheets. In February 2019, we entered into an interest rate swap arrangement to manage our exposure to changes in LIBOR-based interest rates underlying the DDTL once drawn upon (Note 4). On November 29, 2019, we exercised our option to borrow $118.0 million pursuant to the DDTL feature and the proceeds were used to repay the outstanding 3% Convertible Senior Notes, which matured on December 1, 2019. The DDTL matures in December 2023 and includes a repayment schedule, pursuant to which $5.9 million will be paid in quarterly installments during 2020. As of December 31, 2019, $5.9 million of the loan is recorded as current borrowings in the accompanying consolidated balance sheets. Amounts drawn on the Term Loan and the DDTL bear an interest rate equal to, at our option, either a LIBOR rate plus 1.50% to 2.75% per annum, depending on our total leverage ratio or an alternative base rate plus an applicable base rate margin, which varies within a range of 0.50% to 1.75%, depending our total leverage ratio. On the Revolver, we incur a commitment fee at a rate per annum that varies within a range of 0.25% to 0.50%, depending on our leverage ratio.

The Credit Facility is secured by a lien on substantially all of ANI Pharmaceuticals, Inc.’s and its principal domestic subsidiary’s assets and any future domestic subsidiary guarantors’ assets. The Credit Facility imposes financial covenants consisting of a maximum total leverage ratio, which is, as of December 31, 2019 no greater than 3.50 to 1.00 and a minimum fixed charge coverage ratio, which shall be greater than or equal to 1.25 to 1.00. The primary non-financial covenants under the Credit Facility limit, subject to various exceptions, our ability to incur future indebtedness, to place liens on assets, to pay dividends or make other distributions on our capital stock, to repurchase our capital stock, to conduct acquisitions, to alter our capital structure, and to dispose of assets.

The carrying value of the current and non-current components of the Term Loan and DDTL as of December 31, 2019 and 2018 are:


	Current
(in thousands)	2019		2018
Current borrowing on secured Term Loan and Delayed Draw Term Loan	$	10,412	$	3,609
Deferred financing costs		(471)		(353)
Current component of Term Loan and Delayed Draw Term Loan, net of deferred financing costs	$	9,941	$	3,256


	Non-Current
(in thousands)	2019		2018
Non-current borrowing on secured Term Loan and Delayed Draw Term Loan	$	177,069	$	68,578
Deferred financing costs		(1,261)		(1,282)
Term Loan and Delayed Draw Term Loan, net of deferred financing costs and current component	$	175,808	$	67,296

The refinancing of the Term Loan was accounted for as a modification of our previous term loan and consequently, the remaining balance of the deferred issuance costs related to the previous term loan are included with the lenders fees associated with the refinance of the Term Loan and amortized as interest expense over the life of the Term Loan using the effective interest method. Fees to third parties associated with the refinance of the Term Loan were recognized as other (expense)/income, net in the accompanying consolidated statements of operations. The refinancing of the Revolver was accounted for as a modification of our previous revolving credit facility and consequently, the remaining balance of the deferred issuance costs related to the previous revolving credit facility are included with the lenders fees and fees to third parties associated with the refinance of the Revolver and amortized as interest expense on a straight-line basis over the life of the Revolver. All issuance costs allocated to the DDTL were deferred and will be amortized as interest expense on a straight-line basis over the five-year term of the DDTL.

As of December 31, 2019, we had a $69.5 million balance on the Term Loan and $118.0 million balance on the DDTL. As of December 31, 2019, we had not drawn on the Revolving Credit Facility. Of the $1.0 million of deferred debt issuance costs allocated to the Revolving Credit Facility, $0.8 million is included in other non-current assets in the accompanying consolidated balance sheets and $0.2 million is included in prepaid expenses and other current assets in the accompanying consolidated balance sheets. Of the 0.5 million of deferred debt issuance costs allocated to the DDTL, $0.1 million is classified as a direct deduction to the current portion of the DDTL in the accompanying consolidated balance sheets and $0.4 million is classified as a direct reduction to the non-current portion of the DDTL in the accompanying consolidated balance sheets. Of the $1.3 million of deferred debt issuance costs allocated to the Term Loan, $0.4 million is classified as a direct deduction to the current portion of the Term Loan in the accompanying consolidated balance sheets and $0.9 million is classified as a direct deduction to the non-current portion of the Term Loan in the accompanying consolidated balance sheets.

The contractual maturity of our Term Loan and DDTL is as follows for the years ending December 31:


(in thousands)	Term Loan		DDTL
2020	$	4,512	$	5,900
2021		5,414		5,900
2022		5,414		8,850
2023		54,141		97,350
Total	$	69,481	$	118,000

Convertible Senior Notes

In December 2014, we issued $143.8 million of our Notes in a registered public offering. After deducting the underwriting discounts and commissions and other expenses (including the net cost of the bond hedge and warrant, discussed below), the net proceeds from the offering were approximately $122.6 million. The Notes paid 3.0% interest semi-annually in arrears on June 1 and December 1 of each year, starting on June 1, 2015, and matured on December 1, 2019. In December 2018, we entered into separate, privately negotiated agreements with certain holders of our Notes and repurchased $25.0 million of our outstanding Notes. We accounted for the repurchase as an extinguishment of the portion of the Notes and recognized a loss on extinguishment of $0.5 million, which was recorded in other (expense)/income, net in the accompanying consolidated statements of operations. At the same time, we unwound a corresponding portion of the bond hedge and warrant, which are described in further detail below. As a result of unwinding this portion of the bond hedge and warrant, we received a net amount of $0.4 million. The repurchase of the Notes and the unwinding of the bond hedge and warrant resulted in a $1.7 million net reduction to additional paid-in capital (“APIC”) in the accompanying consolidated balance sheets. The remaining Notes were convertible into 1,709,002 shares of common stock, based on an initial conversion price of $69.48 per share.

The Notes were convertible at the option of the holder (i) during any calendar quarter beginning after March 31, 2015, if the last reported sale price of the common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day, (ii) during the five business days after any five consecutive trading day period in which the trading price per $1,000 principal amount of the Notes for each trading day of such period was less than 98% of the product of the last reported sale price of our common stock and the conversion rate on each such trading day; and (iii) on or after June 1, 2019 until the second scheduled trading day immediately preceding the maturity date.

Upon conversion by the holders, we had the option to settle such conversion in shares of our common stock, cash, or a combination thereof. As a result of our cash conversion option, we separately accounted for the value of the embedded conversion option as a debt discount (with an offset to APIC) of $33.6 million. The value of the embedded conversion option was determined based on the estimated fair value of the debt without the conversion feature, which was determined using market comparables to estimate the fair value of similar non-convertible debt (Note 8); the debt discount was amortized as additional non-cash interest expense using the effective interest method over the term of the Notes.

Offering costs of $5.5 million were allocated to the debt and equity components in proportion to the allocation of proceeds to the components, as deferred financing costs and equity issuance costs, respectively. The deferred financing costs of $4.2 million were amortized as additional non-cash interest expense using the straight-line method over the term of the debt, since this method was not significantly different from the effective interest method. Pursuant to guidance issued by the FASB, we classified the deferred financing costs as a direct deduction to the net carrying value of our Convertible Debt. The $1.3 million portion allocated to equity issuance costs was charged to APIC.

A portion of the offering proceeds was used to simultaneously enter into a “bond hedge” (or purchased call) and “warrant” (or written call) transactions with an affiliate of one of the offering underwriters (collectively, the “Call Option Overlay”). We entered into the Call Option Overlay to synthetically raise the initial conversion price of the Notes to $96.21 per share and reduce the potential common stock dilution that may arise from the conversion of the Notes. The exercise price of the bond hedge is $69.48 per share and the exercise price of the warrant is $96.21 per share of our common stock. Because the bond hedge and warrant are both indexed to our common stock and otherwise would be classified as equity, we recorded both elements as equity, resulting in a net reduction to APIC of $15.6 million. After the repurchase of $25.0 million of our outstanding Notes and the unwinding of the corresponding portion of the bond hedge and warrant, our remaining bond hedge had an underlying 1,709,002 common shares and the remaining warrant had an underlying 1,709,002 common shares.

On December 2, 2019 (December 1, 2019 was not a business day), we used the proceeds of the DDTL and operating cash on hand to repay the outstanding Notes. Holders of $50,000 of the Notes elected for conversion, which pursuant to the First Supplemental Indenture to the Notes, resulted in the holders’ receipt of cash for the principal portion of the Notes and 33 shares of our common stock. These shares were provided by our counterparty pursuant to the Call Option Overlay. As of December 31, 2019, the remaining warrant had an underlying 1,709,002 common shares.

The carrying value of the Notes is as follows as of December 31:


(in thousands)	2019		2018
Principal amount	$	—	$	118,750
Unamortized debt discount		—		(5,648)
Deferred financing costs		—		(639)
Net carrying value	$	—	$	112,463

The effective interest rate on the Notes was 7.4% and 8.5%, on an annualized basis, as of December 31, 2019 and 2018, respectively.

The following table sets forth the components of total interest expense related to the Notes, Term Loan, and DDTL recognized in our consolidated statements of operations for the year ended December 31:


(in thousands)	2019		2018		2017
Contractual coupon	$	6,635	$	7,170	$	4,313
Amortization of debt discount		5,647		7,002		6,720
Amortization of finance fees		1,377		1,463		845
Capitalized interest		(191)		(724)		(554)
	$	13,468	$	14,911	$	11,324

DERIVATIVE FINANCIAL INSTRUMENT AND HEDGING ACTIVITY	12 Months Ended
DERIVATIVE FINANCIAL INSTRUMENT AND HEDGING ACTIVITY	Dec. 31, 2019
DERIVATIVE FINANCIAL INSTRUMENT AND HEDGING ACTIVITY
DERIVATIVE FINANCIAL INSTRUMENT AND HEDGING ACTIVITY	4. DERIVATIVE FINANCIAL INSTRUMENT AND HEDGING ACTIVITY In April 2018, we entered into an interest rate swap arrangement, which was considered a derivative financial instrument, with Citizens Bank, N.A. to manage our exposure to changes in LIBOR-based interest rates underlying our previous Term Loan. The interest rate swap hedged the variable cash flows associated with the borrowings under our previous Term Loan (Note 3), effectively providing a fixed rate of interest throughout the life of the previous Term Loan. In December 2018, we refinanced our previous Credit Agreement and, as part of that refinancing, extended the maturity of our $72.2 million secured Term Loan to December 2023. At the same time, we closed out the original interest rate swap and entered into a new interest rate swap arrangement, which is also considered a derivative financial instrument, with Citizens Bank, N.A. to manage our exposure to changes in LIBOR-based interest rates underlying our Term Loan. We accounted for the close-out of the original interest rate swap as a termination of the interest rate swap and wrote the interest rate swap liability and accumulated other comprehensive loss balance off as of the date of termination. As there were no excluded components, there was no net impact to the consolidated statement of operations. The interest rate swap hedges the variable cash flows associated with the borrowings under our Term Loan (Note 3), effectively providing a fixed rate of interest throughout the life of our Term Loan. The interest rate swap arrangement with Citizens Bank, N.A became effective on December 27, 2018, with a maturity date of December 27, 2023. The notional amount of the swap agreement at inception was $72.2 million and decreases in line with our Term Loan. As of December 31, 2019, the notional amount of the interest rate swap was $69.5 million. The interest rate swap has a weighted average fixed rate of 2.60% and has been designated as an effective cash flow hedge and therefore qualifies for hedge accounting. As of December 31, 2019, the fair value of the interest rate swap liability was valued at $2.4 million and was recorded in other non-current liabilities in the accompanying consolidated balance sheets. As of December 31, 2019, $1.9 million, the fair value of the interest rate swap net of tax, was recorded in accumulated other comprehensive loss, net of tax in the accompanying consolidated balance sheets. During the year ended December 31, 2019, changes in the fair value of the interest rate swap of $1.5 million, net of tax, was recorded in accumulated other comprehensive (loss), net of tax in our consolidated statements of comprehensive income. Differences between the hedged LIBOR rate and the fixed rate are recorded as interest expense in the same period that the related interest is recorded for the Term Loan based on the LIBOR rate. In the year ended December 31, 2019, $0.2 million of interest expense was recognized in relation to the interest rate swap. In February 2019, we entered into an interest rate swap with Citizens Bank, N.A. to manage our exposure to changes in LIBOR-based interest rates underlying our DDTL. As of December 31, 2019, the notional amount of the interest rate swap was $118.0 million and decreases in line with our DDTL. The interest rate swap provides an effective fixed rate of 2.47% and has been designated as an effective cash flow hedge and therefore qualifies for hedge accounting. The interest rate swap hedges the variable cash flows associated with the borrowings under our DDTL (Note 3), effectively providing a fixed rate of interest throughout the life of our DDTL. As of December 31, 2019, the fair value of the interest rate swap liability was valued at $3.8 million and was recorded in other non-current liabilities in the accompanying consolidated balance sheets. As of December 31, 2019, $3.0 million, the fair value of the interest rate swap net of tax, was recorded in accumulated other comprehensive loss, net of tax in the accompanying consolidated balance sheets. During the year ended December 31, 2019, changes in the fair value of the interest rate swap of $3.0 million, net of tax, were recorded in accumulated other comprehensive loss, net of tax in our consolidated statements of comprehensive income. Differences between the hedged LIBOR rate and the fixed rate are recorded as interest expense in the same period that the related interest is recorded for the DDTL based on the LIBOR rate. In the year ended December 31, 2019, $0.1 million of interest expense was recognized in relation to the February 2019 interest rate swap.

INVENTORIES

12 Months Ended

Dec. 31, 2019

INVENTORIES

INVENTORIES

5. INVENTORIES

Inventories consist of the following as of December 31:


(in thousands)	2019		2018(1)
Raw materials	$	34,881	$	27,671
Packaging materials		2,902		2,563
Work-in-progress		361		1,210
Finished goods		16,750		10,620
		54,894		42,064
Reserve for excess/obsolete inventories		(6,731)		(1,561)
Inventories, net	$	48,163	$	40,503

⁽¹⁾

Includes inventory acquired in acquisition of WellSpring (Note 2).

During the fourth quarter 2019, we recognized a $4.6 million inventory reserve charge, primarily related to our exit from the market of Methylphenidate Extended Release.

PROPERTY, PLANT, AND EQUIPMENT

12 Months Ended

Dec. 31, 2019

PROPERTY, PLANT, AND EQUIPMENT

PROPERTY, PLANT, AND EQUIPMENT

6. PROPERTY, PLANT, AND EQUIPMENT

Property, plant, and equipment consist of the following as of December 31:


(in thousands)	2019		2018(1)
Land	$	4,566	$	4,558
Buildings		10,275		10,079
Machinery, furniture, and equipment		34,984		26,814
Construction in progress		3,496		5,040
		53,321		46,491
Less: accumulated depreciation		(12,770)		(8,401)
Property and equipment, net	$	40,551	$	38,090

⁽¹⁾

Includes property and equipment acquired in acquisition of WellSpring (Note 2).

Depreciation expense for the years ended December 31, 2019, 2018, and 2017 totaled $4.4 million, $2.1 million, and $1.2 million, respectively. During the years ended December 31, 2019 and 2018, there was $0.2 million and $0.7 million of interest capitalized into construction in progress, respectively.

INTANGIBLE ASSETS

12 Months Ended

Dec. 31, 2019

INTANGIBLE ASSETS

INTANGIBLE ASSETS

7. INTANGIBLE ASSETS

Goodwill

As a result of the Merger we recorded goodwill of $1.8 million. As a result of our acquisition of WellSpring, we recorded additional goodwill of $1.7 million in 2018. We assess the recoverability of the carrying value of goodwill on an annual basis as of October 31 of each year, and whenever events occur or circumstances changes that would, more likely than not, reduce the fair value of our reporting unit below its carrying value.

Changes in the carrying amount of goodwill as of December 31 are as follows:


(in thousands)	2019		2018
Balance at beginning of year	$	3,580	$	1,838
Acquisition of WellSpring (Note 2)		—		1,742
Balance at end of year	$	3,580	$	3,580

For the goodwill impairment analyses performed at October 31, 2019 and 2018, we performed qualitative assessments to determine whether it was more likely than not that our goodwill asset was impaired in order to determine the necessity of performing a quantitative impairment test, under which management would calculate the asset’s fair value. When performing the qualitative assessments, we evaluated events and circumstances that would affect the significant inputs used to determine the fair value of the goodwill. Events and circumstances evaluated include: macroeconomic conditions that could affect us, industry and market considerations for the pharmaceutical industry that could affect us, cost factors that could affect our performance, our financial performance (including share price), and consideration of any company-specific events that could negatively affect us, our business, or our fair value. Based on our assessments of the aforementioned factors, it was determined that it was more likely than not that the fair value of our one reporting unit is greater than its carrying amount as of October 31, 2019 and 2018, and therefore no quantitative testing for impairment was required.

In addition to the qualitative impairment analysis performed at October 31, 2019, there were no events or changes in circumstances that could have reduced the fair value of our reporting unit below its carrying value from October 31, 2019 to December 31, 2019. No impairment loss was recognized during the years ended December 31, 2019, 2018, and 2017, and the balance of goodwill was $3.6 million as of December 31, 2019 and 2018.

Definite-lived Intangible Assets

Acquisition of Abbreviated New Drug Applications

In January 2019, we entered into an amendment to three asset purchase agreements (the “Asset Purchase Agreement Amendment”) with Teva Pharmaceuticals USA, Inc. (“Teva”). Under the terms of the Asset Purchase Agreement Amendment, all royalty obligations of the Company owed to Teva with respect to products associated with ten ANDAs under the original asset purchase agreements ceased being effective as of December 31, 2018. As consideration for the termination of such future royalty obligations, we paid Teva a sum of $16.0 million. Upon the payment of $16.0 million, the purchase price of each basket of ANDAs was increased as if the payment had been made on the initial acquisition date. As a result, we recognized cumulative amortization expense of $6.8 million upon recording the transaction. Please see Note 8 for further details regarding the transaction.

In April 2018, we entered into an agreement with Impax Laboratories, Inc. (now Amneal Pharmaceuticals, Inc., or “Amneal”) to purchase the approved ANDAs for three previously-commercialized generic drug products, the approved ANDAs for two generic drug products that have not yet been commercialized, the development package for one generic drug product, a license, supply, and distribution agreement for a generic drug product with an ANDA that is pending approval, and certain manufacturing equipment required to manufacture one of the products, for $2.3 million in cash up front. We also capitalized $0.1 million of costs directly related to the transaction. We accounted for this transaction as an asset purchase. The $1.0 million acquired ANDA intangible assets are being amortized in full over their estimated useful lives of 10 years. Please see Note 8 for further details regarding the transaction.

Acquisition of New Drug Applications and Product Rights

In December 2017, we entered into an agreement with AstraZeneca AB and AstraZeneca UK Limited to purchase the right, title, and interest in the NDAs and the U.S. rights to market Atacand, Atacand HCT, Arimidex, and Casodex, for $46.5 million in cash. We also entered into a license agreement for use of these trademarks in the U.S. We also capitalized $0.2 million of costs directly related to the asset purchase. We accounted for this transaction as an asset purchase. The $46.7 million product rights assets are being amortized in full over their estimated useful lives of 10 years. Please see Note 8 for further details regarding the transaction.

In February 2017, we entered into an agreement with Cranford Pharmaceuticals, LLC to purchase a distribution license, trademark, and certain finished goods inventory for Inderal XL for $20.2 million in cash. We accounted for this transaction as an asset purchase. We also capitalized $40 thousand of costs directly related to the transaction. The $15.1 million product rights intangible asset acquired in the asset purchase is being amortized in full over its estimated useful life of 10 years. Please see Note 8 for further details regarding the transaction.

In February 2017, we entered into an agreement with Holmdel Pharmaceuticals, LP to purchase the NDA, trademark, and certain finished goods inventory for InnoPran XL, including a license to an Orange Book listed patent, for $30.6 million in cash. We accounted for this transaction as an asset purchase. We also capitalized $0.1 million of costs directly related to the transaction. The $19.0 million product rights intangible asset acquired in the asset purchase is being amortized in full over its estimated useful life of 10 years. Please see Note 8 for further details regarding the transaction.

In conjunction with our 2013 merger with BioSante (the “Merger”), we acquired a testosterone gel product that was licensed to Teva (the “Testosterone Gel NDA”) and this product was assigned an intangible asset value of $10.9 million in accounting for the Merger. In May 2015, Teva transferred the rights of the product back to ANI. In exchange, we will pay Teva a royalty of up to $5.0 million, at a rate of 5% of the consideration we receive as a result of commercial sale of the product. We assessed the value of the Testosterone Gel NDA under the new arrangement and determined that the net asset value was recoverable as of the May 2015 transfer date and subsequent balance sheet dates. We began the commercialization process for the product during the second half of 2015 and it continued throughout 2016. In late 2016, we determined that the development and manufacturing costs required to commercialize the product had increased and would pose a significant barrier to commercializing the product ourselves. Generic competition in the testosterone replacement market had increased substantially by the end of 2016, leading to significant decreases in pricing for the product. In the fourth quarter, management began putting forth efforts to sell the Testosterone Gel NDA rather than commercialize it ourselves. As a result of all these factors, in the fourth quarter of 2016, we determined that the facts and circumstances indicated that the asset could be impaired. We performed an impairment assessment, which indicated that the fair value of the asset was lower than the carrying value. We determined the fair value of the Testosterone Gel NDA by using a discounted cash flows model. As a result of this assessment, we recorded an impairment of $6.7 million in the year ended December 31, 2016. In addition, the remaining $0.9 million asset was recorded as a short-term asset held for sale as of December 31, 2016 in the prepaid expenses and other assets caption in the accompanying consolidated balance sheets. Throughout 2017, we continued to attempt to sell the Testosterone Gel NDA and were unable to complete a sale. As a result, in the fourth quarter of 2017, we determined that the asset could be impaired. After performing an impairment assessment, which indicated that the fair value of the asset was lower than the carrying value, we recorded an additional impairment of $0.9 million in the year ended December 31, 2017, writing off the asset in its entirety.

Marketing and Distribution Rights

In April 2019, we entered into an agreement with Pharmaceutics International, Inc. (“PII”) and BAS ANDA LLC (“BAS”), under which a previously-commercialized product will be developed and marketed. Per the agreement, we may pay PII a series of licensing fees in conjunction with the achievement of certain development and commercial milestones. In the fourth quarter of 2019, the product was launched, triggering a $0.5 million payment due to PII. The payment due as of December 31, 2019 was capitalized as an intangible asset and will be amortized in full over its useful life of 10 years.

In March 2018, we entered into an agreement with Appco Pharma, LLC (“Appco”), in which a potential generic product, Ranitidine, was to be developed and marketed. Per the agreement, we paid Appco a series of licensing fees in conjunction with certain development milestones. Ranitidine was launched in the third quarter of 2019, resulting in the final milestone payment of $80 thousand. The $80 thousand milestone payment was capitalized as an intangible asset and determined to have an estimated useful life of eight years. In September 2019, the Food and Drug Administration (“FDA”) issued a public statement that some ranitidine medicines contain a nitrosamine impurity called N-nitrosdimethylamine (“NDMA”) at low levels. NDMA is classified as a probable human carcinogen (a substance that could cause cancer) based on results from laboratory tests and the cause of the presence of this impurity in the ranitidine products is not yet fully understood at this time. During the fourth quarter 2019, testing of the API used in our ranitidine drug product, as well as testing of the drug product itself, indicated a level of NDMA above acceptable thresholds and Appco initiated a voluntary recall. The Company has elected to exit the market for Ranitidine and determined that the carrying value of the asset has been impaired. During the fourth quarter 2019, the Company recognized a full impairment of the remaining $75 thousand carrying value of the asset.

The components of net definite-lived intangible assets are as follows:


	December 31, 2019				December 31, 2018				Weighted Average
	Gross Carrying		Accumulated		Gross Carrying		Accumulated		Amortization
(in thousands)	Amount		Amortization		Amount		Amortization		Period
Acquired ANDA intangible assets	$	64,704	$	(30,169)	$	46,194	$	(17,093)	10.0 years
NDAs and product rights		230,974		(87,352)		230,974		(62,222)	10.0 years
Marketing and distribution rights		10,923		(8,982)		10,423		(7,051)	4.7 years
Non-compete agreement		624		(334)		624		(245)	7.0 years
	$	307,225	$	(126,837)	$	288,215	$	(86,611)	10.0 years

Definite-lived intangible assets are stated at cost, net of amortization, generally using the straight-line method over the expected useful lives of the intangible assets. In the case of the Inderal XL and InnoPran XL asset purchases, because we anticipate that the acquired assets will provide a greater economic benefit in the earlier years, we are amortizing 80% of the value of the intangible assets over the first five years of useful lives of the assets and amortizing the remaining 20% of the value of the intangible assets over the second five years of useful lives of the assets. Amortization expense was $40.2 million, $31.7 million, and $26.7 million for the years ended December 31, 2019, 2018, and 2017, respectively.

We test for impairment of definite-lived intangible assets when events or circumstances indicate that the carrying value of the assets may not be recoverable. We recognized an impairment of $75 thousand in the year ended December 31, 2019, in relation to the Ranitidine product right asset. No impairment losses related to intangible assets were recognized in the year ended December 31, 2018. We recognized an impairment of $0.9 million in the year ended December 31, 2017, in relation to the Testosterone Gel NDA. No events or circumstances arose in 2019, 2018, or 2017 that indicated that the carrying value of any of our other definite-lived intangible assets may not be recoverable.

Expected future amortization expense is as follows for the years ending December 31:


(in thousands)
2020	$	33,180
2021		31,734
2022		28,329
2023		27,581
2024		24,604
2025 and thereafter		34,960
Total	$	180,388

FAIR VALUE DISCLOSURES

12 Months Ended

Dec. 31, 2019

FAIR VALUE DISCLOSURES

FAIR VALUE DISCLOSURES

8. FAIR VALUE DISCLOSURES

Fair value is the price that would be received from the sale of an asset or paid to transfer a liability assuming an orderly transaction in the most advantageous market at the measurement date. U.S. GAAP establishes a hierarchical disclosure framework which prioritizes and ranks the level of observability of inputs used in measuring fair value.

The inputs used in measuring the fair value of cash and cash equivalents are considered to be Level 1 in accordance with the three-tier fair value hierarchy. The fair market values are based on period-end statements supplied by the various banks and brokers that held the majority of our funds. The fair value of short-term financial instruments (primarily accounts receivable, prepaid expenses, accounts payable, accrued expenses, and other current liabilities) approximate their carrying values because of their short-term nature. The Term Loan and DDTL bear an interest rate that fluctuates with the changes in LIBOR and, because the variable interest rates approximate market borrowing rates available to us, we believe the $69.5 million and $118.0 million carrying value of the Term Loan and DDTL approximated their fair values at December 31, 2019.

Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis

Our contingent value rights (“CVRs”), which were granted coincident with our merger with BioSante and expire in June 2023, are considered to be contingent consideration and are classified as liabilities. As such, the CVRs were recorded as purchase consideration at their estimated fair value, using Level 3 inputs, and are marked to market each reporting period until settlement. The fair value of CVRs is estimated using the present value of management’s projection of the expected payments pursuant to the terms of the CVR agreement, which is the primary unobservable input. If our projection or expected payments were to increase substantially, the value of the CVRs could increase as a result. The present value of the liability was calculated using a discount rate of 15%. We determined that the fair value of the CVRs was immaterial as of December 31, 2019 and 2018. We also determined that the changes in such fair value were immaterial for the years ended December 31, 2019, 2018, and 2017.

In April 2018, we entered into an interest rate swap arrangement (Note 4), with Citizens Bank, N.A. to manage our exposure to the variable interest rate on our previous Term Loan. The notional amount of this interest rate swap was set to match the balance of our previous Term Loan. The fair value of our interest rate swap was estimated based on the present value of projected future cash flows using the LIBOR forward rate curve. The model used to value the interest rate swap included inputs of readily observable market data, a Level 2 input.

In December 2018, we refinanced our previous Credit Agreement and, as part of that refinancing, extended the maturity of our $72.2 million secured Term Loan to December 2023. At the same time, we closed out the original interest rate swap and entered into a new interest rate swap arrangement (Note 4) to manage our exposure to the variable interest rate on our Term Loan (Note 3). The notional amount of our interest rate swap is set to match the balance of our Term Loan. Both the notional amount of the interest rate swap and the balance of our Term Loan were $69.5 million as of December 31, 2019. The fair value of our interest rate swap is estimated based on the present value of projected future cash flows using the LIBOR forward rate curve. The model used to value the interest rate swap includes inputs of readily observable market data, a Level 2 input. As described in detail in Note 4, the fair value of the interest rate swap was a $2.4 million liability at December 31, 2019.

In February 2019, we entered into an interest rate swap arrangement (Note 4), with Citizens Bank, N.A. to manage our exposure to changes in LIBOR-based interest rates underlying our DDTL (Note 3). The notional amount of our interest rate swap is set to match the balance of our DDTL. Both the notional amount of the interest rate swap and the balance of our DDTL were $118.0 million as of December 31, 2019. The fair value of our interest rate swap was estimated based on the present value of projected future cash flows using the LIBOR forward rate curve. The model used to value the interest rate swap included inputs of readily observable market data, a Level 2 input. As described in detail in Note 4, the fair value of the interest rate swap was a $3.8 million liability at December 31, 2019.

The following table presents our financial assets and liabilities accounted for at fair value on a recurring basis as of December 31, 2019 and December 31, 2018, by level within the fair value hierarchy:


(in thousands)	Fair Value at
Description	December 31, 2019		Level 1		Level 2		Level 3
Liabilities
Interest rate swaps	$	6,215	$	—	$	6,215	$	—
CVRs	$	—	$	—	$	—	$	—


	Fair Value at
Description	December 31, 2018		Level 1		Level 2		Level 3
Liabilities
Interest rate swaps	$	496	$	—	$	496	$	—
CVRs	$	—	$	—	$	—	$	—

Financial Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis

We have no non-financial assets and liabilities that are measured at fair value on a non-recurring basis.

Non-Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis

We have no non-financial assets and liabilities that are measured at fair value on a recurring basis.

Non-Financial Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis

We measure our long-lived assets, including property, plant and equipment, intangible assets and goodwill, at fair value on a non-recurring basis. These assets are recognized at fair value when they are deemed to be other-than-temporarily impaired. During the year ended December 31, 2019, we recognized a $75 thousand impairment charge related to our Ranitidine product right asset (Note 7). There were no other fair value impairments recognized in the year ended December 31, 2019.

Acquired Non-Financial Assets Measured at Fair Value

In June 2019, we acquired from Coeptis Pharmaceuticals, Inc. seven development stage generic products, as well as API and reference-listed drug inventory related to certain of the products for a payment of $2.3 million. The entire payment, and $24 thousand of transaction costs directly related to the acquisition, was recorded as research and development expense because the potential generic products have significant remaining work required in order to commercialize the products and do not have an alternative future use. In addition, we could make up to $12.0 million in payments for certain development and commercial milestones. These milestones were determined to be contingent liabilities and will be accrued when they are both estimable and probable.

In April 2019, we entered into an agreement with PII and BAS, under which a previously-commercialized product will be developed and marketed. Per the agreement, we may pay PII a series of licensing fees in conjunction with the achievement of certain development and commercial milestones. In the fourth quarter of 2019, the product was launched, triggering a $0.5 million payment due to PII. The payment due as of December 31, 2019 was capitalized as an intangible asset and will be amortized in full over its useful life of 10 years.

In March 2019, we entered into an agreement with Teva Pharmaceutical Industries Ltd. to purchase a basket of ANDAs for 35 previously-marketed generic drug products for $2.5 million in cash (Note 7). We also capitalized $10 thousand of costs directly related to the asset purchase. We accounted for this transaction as an asset purchase. The $2.5 million of ANDAs were recorded at their relative fair value, determined using Level 3 unobservable inputs. In order to determine the fair value of the product rights intangible assets, we used the present value of the estimated cash flows related to the product rights, using a discount rate of 15%. The ANDAs will be amortized in full over their 10-year useful lives and will be tested for impairment when events or circumstances indicate that the carrying value of the asset may not be recoverable. No such triggering events were identified during the period from the date of acquisition to December 31, 2019 and therefore no impairment loss was recognized for the year ended 2019.

In January 2019, we entered into an amendment to asset purchase agreements with Teva related to three purchases of baskets of ANDAs. Under the terms of the Asset Purchase Agreement Amendment, all royalty obligations of the Company owed to Teva with respect to products associated with ten ANDAs under the original asset purchase agreements ceased being effective as of December 31, 2018. As consideration for the termination of such future royalty obligations, we paid Teva a sum of $16.0 million in cash (Note 7). Upon payment of $16.0 million, the purchase price of each basket of ANDAs was increased to reflect the subsequent payment as if that payment had been made on the initial acquisition date. As a result, in addition to increasing the carrying value of the acquired ANDA intangible assets by $9.2 million, we recognized cumulative amortization expense of $6.8 million. The payment was allocated to the three ANDA baskets based on the relative fair value of the ANDA baskets, which were determined using Level 3 unobservable inputs. In order to determine the fair value of the acquired ANDA intangible assets, we used the present value of the estimated cash flows related to the ANDAs, using a discount rate of 12%. The additional carrying value will be amortized over the remaining useful lives of the three ANDA baskets and will be tested for impairment when events or circumstances indicate that the carrying value of the asset may not be recoverable. No such triggering events were identified during the period from the date of acquisition to December 31, 2019 and therefore no impairment loss was recognized for the year ended 2019.

In April 2018, we entered into an agreement with Impax Laboratories, Inc. (now Amneal) to purchase the approved ANDAs for three previously-commercialized generic drug products, the approved ANDAs for two generic drug products that have not yet been commercialized, the development package for one generic drug product, a license, supply, and distribution agreement for a generic drug product with an ANDA that is pending approval, and certain manufacturing equipment required to manufacture one of the products, for $2.3 million in cash (Note 7). At the same time, we entered into a supply agreement with Amneal under which we may elect to purchase the finished goods for one of the products for up to 17 months beginning October 1, 2019, under certain conditions. If we do elect to purchase the finished goods from Amneal for this period, we may be required to pay a milestone payment of up to $10.0 million upon launch, depending on the number of competitors selling the product at the time of launch. This milestone payment was determined to be contingent consideration and will be recognized when the contingency is resolved. When one of the approved ANDAs that have not yet been commercialized is launched, we could be required to pay a milestone of $25.0 million to Teva Pharmaceuticals USA, Inc. (“Teva”), depending on the number of competitors selling the product at the time of launch. In addition, depending on the number of competitors selling the product one year after the launch date, we could be required to pay a second milestone of $15.0 million to Teva. These milestones are determined to be contingent liabilities and will be recognized if and when they are both estimable and probable. Because we believe that neither milestone is both estimable and probable, we did not record a contingent liability for the milestones. We also capitalized $0.1 million of costs directly related to the asset purchase. We accounted for this transaction as an asset purchase. The $1.0 million acquired ANDA intangible assets were recorded at their relative fair value, determined using Level 3 unobservable inputs. In order to determine the fair value of the acquired ANDA intangible assets, we used the present value of the estimated cash flows related to the approved ANDAs, using discount rates of 10 to 15%. The acquired ANDAs will be amortized in full over their 10‑year useful lives, and will be tested for impairment when events or circumstances indicate that the carrying value of the assets may not be recoverable. The $58 thousand of manufacturing equipment used to manufacture one of the products was recorded at its relative fair value, based on the estimated net book value of the equipment purchased. The equipment will be amortized in full over its 5‑year useful life, and will be tested for impairment when events or circumstances indicate that the carrying value of the asset may not be recoverable. No such triggering events were identified during the period from the date of acquisition to December 31, 2019 and therefore no impairment loss was recognized for the years ended December 31, 2018 and 2019. The $1.3 million of in-process research and development related to products with significant further work required in order to commercialize the products, and for which there is no alternative future use. The in-process research and development was recorded at its relative fair value, determined using Level 3 unobservable inputs. In order to determine the fair value of the in-process research and development, we used the present value of the estimated cash flows related to the products, using a discount rate of 75%, reflective of the higher risk associated with these products. As the transaction was accounted for as an asset purchase, the $1.3 million of in-process research and development was immediately recognized as research and development expense.

In April 2018, we entered into an agreement with IDT Australia, Limited to purchase the ANDAs for 23 previously-marketed generic drug products and API for four of the acquired products for $2.7 million in cash and a single-digit royalty on net profits from sales of one of the products (Note 7). We also capitalized $18 thousand of costs directly related to the asset purchase. We accounted for this transaction as an asset purchase. The $2.5 million acquired ANDA intangible assets were recorded at their relative fair value, determined using Level 3 unobservable inputs. In order to determine the fair value of the product rights intangible assets, we used the present value of the estimated cash flows related to the product rights, using discount rates of 10% to 15%. The acquired ANDA intangible assets will be amortized in full over their 10‑year useful lives, and will be tested for impairment when events or circumstances indicate that the carrying value of the asset may not be recoverable. No such triggering events were identified during the period from the date of acquisition to December 31, 2019 and therefore no impairment loss was recognized for the years ended December 31, 2018 and 2019. We also recorded $0.2 million of raw materials inventory, measured at fair value. The fair value of the raw materials inventory was determined based on the estimated replacement cost.

In March 2018, we entered into an agreement with Appco, in which a potential generic product, Ranitidine, was to be developed and marketed. Per the agreement, we paid Appco a series of licensing fees in conjunction with certain development milestones. Ranitidine was launched in the third quarter of 2019, resulting in the final milestone payment of $80 thousand. The $80 thousand milestone payment was capitalized as an intangible asset and determined to have estimated useful life of eight years. In September 2019, the FDA issued a public statement that some ranitidine medicines contain a nitrosamine impurity referred to as NDMA at low levels. NDMA is classified as a probable human carcinogen (a substance that could cause cancer) based on results from laboratory tests and the cause of the presence of this impurity in the ranitidine products is not yet fully understood at this time. During the fourth quarter of 2019, testing of the API used in our ranitidine drug product, as well as testing of the drug product itself, indicated a level of NDMA above acceptable thresholds and Appco initiated a voluntary recall. The Company has elected to exit the market for Ranitidine and determined that the carrying value of the asset has been impaired. During the fourth quarter of 2019, the Company recognized a full impairment of the remaining $75 thousand carrying value of the asset.

In December 2017, we entered into an agreement with AstraZeneca AB and AstraZeneca UK Limited to purchase the right, title, and interest in the NDAs and the U.S. right to market Atacand, Atacand HCT, Arimidex, and Casodex, for $46.5 million in cash (Note 7). We also licensed these trademarks for use in the U.S. We also capitalized $0.2 million of costs directly related to the asset purchase. The agreement included a $3.0 million contingent payment due in early 2023 if the annual net sales of the Atacand and Atacand HCT products equals or exceeds certain threshold amounts in 2020, 2021, and 2022. Because we believe that the likelihood of meeting or exceeding the threshold amounts is not probable, we did not record a contingent liability in relation to the agreement. We accounted for this transaction as an asset purchase. The $46.7 million product rights intangible assets were recorded at their relative fair value, determined using Level 3 unobservable inputs. In order to determine the fair value of the product rights intangible assets, we used the present value of the estimated cash flows related to the product rights, using a discount rate of 10%. The product rights will be amortized in full over their 10‑year useful lives, and will be tested for impairment when events or circumstances indicate that the carrying value of the asset may not be recoverable. No such triggering events were identified during the period from the date of acquisition to December 31, 2019 and therefore no impairment loss was recognized for the years ended December 31, 2017, 2018, and 2019.

In February 2017, we entered into an agreement with Cranford Pharmaceuticals, LLC to purchase a distribution license, trademark, and certain finished goods inventory for Inderal XL for $20.2 million in cash (Note 7). We also capitalized $40 thousand of costs directly related to the asset purchase. We accounted for this transaction as an asset purchase. The $15.1 million product rights intangible asset was recorded at its relative fair value, determined using Level 3 unobservable inputs. In order to determine the fair value of the product rights intangible asset, we used the present value of the estimated cash flows related to the product rights, using a discount rate of 10%. The product rights will be amortized in full over its 10‑year useful life, and will be tested for impairment when events or circumstances indicate that the carrying value of the asset may not be recoverable. No such triggering events were identified during the period from the date of acquisition to December 31, 2019 and therefore no impairment loss was recognized for the years ended December 31, 2019, 2018, and 2017. We also recorded $5.0 million of finished goods inventory. The fair value of the finished goods inventory was determined based on the estimated selling price to be generated from the finished goods, less costs to sell, including a reasonable margin.

In February 2017, we entered into an agreement with Holmdel Pharmaceuticals, LP to purchase the NDA, trademark, and certain finished goods inventory for InnoPran XL, including a license to an Orange Book listed patent, for $30.6 million in cash (Note 7). We also capitalized $0.1 million of costs directly related to the asset purchase. We accounted for this transaction as an asset purchase. The $19.0 million product rights intangible asset was recorded at its relative fair value, determined using Level 3 unobservable inputs. In order to determine the fair value of the product rights intangible asset, we used the present value of the estimated cash flows related to the product rights, using a discount rate of 10%. The product rights will be amortized in full over its 10‑year useful life, and will be tested for impairment when events or circumstances indicate that the carrying value of the asset may not be recoverable. No such triggering events were identified during the period from the date of acquisition to December 31, 2019 and therefore no impairment loss was recognized for the years ended December 31, 2017, 2018, and 2019. We also recorded $11.6 million of finished goods inventory. The fair value of the finished goods inventory was determined based on the estimated selling price to be generated from the finished goods, less costs to sell, including a reasonable margin.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

STOCKHOLDERS' EQUITY

12 Months Ended

Dec. 31, 2019

Stockholders' Equity Note [Abstract]

STOCKHOLDER'S EQUITY

9. STOCKHOLDERS’ EQUITY

Authorized shares

We are authorized to issue up to 33.3 million shares of common stock with a par value of $0.0001 per share, 0.8 million shares of class C special stock with a par value of $0.0001 per share, and 1.7 million shares of undesignated preferred stock with a par value of $0.0001 per share at December 31, 2019.

There were 12.1 million and 11.9 million shares of common stock issued and outstanding as of December 31, 2019 and 2018, respectively.

There were 11 thousand shares of class C special stock issued and outstanding as of December 31, 2019 and 2018. Each share of class C special stock entitles its holder to one vote per share. Each share of class C special stock is exchangeable, at the option of the holder, for one share of our common stock, at an exchange price of $90.00 per share, subject to adjustment upon certain capitalization events. Holders of class C special stock are not entitled to receive dividends or to participate in the distribution of our assets if we were to liquidate, dissolve, or wind-up the company. The holders of class C special stock have no cumulative voting, preemptive, subscription, redemption, or sinking fund rights.

There were no shares of undesignated preferred stock outstanding as of December 31, 2019 and 2018.

Warrants

Warrants to purchase an aggregate of 1.7 million shares of our common stock were outstanding and exercisable as of December 31, 2019:


	Number of
	Underlying Shares
	of Common Stock	Per Share		First
Issue Date	(in thousands)	Exercise Price		Expiration Date
December 4, 2014	1,486	$	96.21	March 1, 2020
December 5, 2014	223	$	96.21	March 1, 2020

All outstanding warrants are classified as equity. No warrants were granted, exercised, or expired unexercised during the years ended December 31, 2019, 2018 and 2017.

The warrants expire ratably over a 60 business day period beginning on March 1, 2020 and finishing on May 25, 2020.

STOCK-BASED COMPENSATION

12 Months Ended

Dec. 31, 2019

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION

10. STOCK-BASED COMPENSATION

Employee Stock Purchase Plan

In July 2016, we commenced administration of the ANI Pharmaceuticals, Inc. 2016 Employee Stock Purchase Plan, which was approved by shareholders in our May 25, 2016 annual shareholder meeting. The Board of Directors and shareholders approved a maximum of 0.2 million shares of common stock, which were reserved and made available for issuance under the ESPP. Under the ESPP, participants can purchase shares of our stock at a 15% discount. We issued six thousand, five thousand, and four thousand shares in the years ended December 31, 2019, 2018, and 2017, respectively.

The following table summarizes ESPP expense incurred under the 2016 Employee Stock Purchase Plan and included in our accompanying consolidated statements of operations:


(in thousands)	Years Ended December 31,
	2019		2018		2017
Cost of sales	$	18	$	11	$	6
Research and development		29		16		1
Selling, general, and administrative		100		75		61
	$	147	$	102	$	68

Stock Incentive Plan

All equity-based service awards are granted under the ANI Pharmaceuticals, Inc. Amended and Restated 2008 Stock Incentive Plan (the “2008 Plan”). As of December 31, 2019, 0.4 million shares of our common stock remained available for issuance under the 2008 Plan.

We measure the cost of equity-based service awards based on the grant-date fair value of the award. The cost is recognized ratably over the period during which an employee is required to provide service in exchange for the award or the requisite service period. We recognize stock-based compensation expense ratably over the vesting periods of the awards.

The following table summarizes stock-based compensation expense incurred under the 2008 Plan and included in our consolidated statements of operations:


	Years Ended December 31,
(in thousands)	2019		2018		2017
Cost of sales	$	101	$	87	$	86
Research and development		756		771		677
Selling, general, and administrative		8,213		5,822		5,259
	$	9,070	$	6,680	$	6,022

We recognized income tax benefits of $1.4 million, $1.2 million, and $0.6 million for stock-based compensation-related tax deductions in our 2019, 2018, and 2017 consolidated statements of operations, respectively.

Stock Options

Outstanding stock options granted to employees and consultants generally vest over a period of four years and have 10‑year contractual terms. Outstanding stock options granted to non-employee directors generally vest over a period of one to four years and have 10‑year contractual terms. Upon exercise of an option, we issue new shares of our common stock or issue shares from treasury stock.

For 2019, 2018, and 2017, the fair value of each option grant was estimated using the Black-Scholes option-pricing model, using the following assumptions:


	Years Ended December 31,
	2019	2018	2017
Expected option life (years)	5.50 - 6.25	5.48 - 6.25	5.33 - 7.00
Risk-free interest rate	1.91% - 2.58%	2.64% - 2.93%	1.93% - 2.33%
Expected stock price volatility	63.1% - 66.7%	55.1% - 60.6%	50.3% - 57.4%
Dividend yield	—	—	—

We use the simplified method to estimate the life of options. The risk-free interest rate used is the yield on a U.S. Treasury note as of the grant date with a maturity equal to the estimated life of the option. We calculated an estimated volatility rate based on the closing prices of several competitors that manufacture similar products. We have not issued a cash dividend in the past nor do we have any current plans to do so in the future; therefore, an expected dividend yield of zero was used.

In 2017, we granted options to two consultants. We used the Black-Scholes option-pricing model to determine the fair value of the option grants and the valuation of the grants were marked to market through December 31, 2018. In June 2018, the FASB issued guidance simplifying the accounting for nonemployee stock-based compensation awards (Note 1). We adopted this guidance as of January 1, 2019, therefore the nonemployee awards are measured at fair value as of the adoption date, and no longer marked to market.

A summary of stock option activity under the 2008 Plan during the years ended December 31, 2019, 2018, and 2017 is presented below:


				Weighted		Weighted
				Average		Average
		Weighted		Grant-		Remaining
(in thousands, except per share and	Option	Average		date		Term	Aggregate
remaining term data)	Shares	Exercise Price		Fair Value		(years)	Intrinsic Value
Outstanding December 31, 2016	578	$	39.28			8.2	$	12,928
Granted	207		51.66	$	27.04
Exercised	(13)		15.92					542
Forfeited	(5)		53.29
Expired	—		—
Outstanding December 31, 2017	767	$	42.93			7.8	$	16,785
Granted	156		57.60	$	31.76
Exercised	(142)		19.47					5,863
Forfeited	(18)		60.17
Expired	(4)		74.53
Outstanding at December 31, 2018	759	$	49.74			7.6	$	2,221
Granted	160		65.97	$	40.14
Exercised	(130)		41.99					3,335
Forfeited	(31)		56.66
Expired	(1)		54.36
Outstanding at December 31, 2019	757	$	54.21			7.2	$	6,761
Exercisable at December 31, 2019	366	$	50.47			6.2	$	4,469

As of December 31, 2019, there was $8.9 million of total unrecognized compensation cost related to non-vested stock options granted under the 2008 Plan. The cost is expected to be recognized over a weighted-average period of 2.5 years. During the year ended December 31, 2019, we received $5.5 million in cash from the exercise of stock options and recorded a $0.7 million tax benefit related to these exercises. During the year ended December 31, 2018, we received $2.8 million in cash from the exercise of stock options and recorded a $0.6 million tax benefit related to these exercises. During the year ended December 31, 2017, we received $0.2 million in cash from the exercise of stock options and recorded a $0.2 million tax benefit related to these exercises.

Restricted Stock Awards

Restricted stock awards (“RSAs”) granted to employees generally vest over a period of four years. RSAs granted to non-officer directors generally vest over a period of one year.

Shares of our common stock delivered to employees and directors will be unrestricted upon vesting. During the vesting period, the recipient of the restricted stock has full voting rights as a stockholder and would receive dividends, if declared, even though the restricted stock remains subject to transfer restrictions and will generally be forfeited upon termination of the officer prior to vesting. The fair value of each RSA is based on the market value of our stock on the date of grant.

A summary of RSA activity under the Plan during the years ended December 31, 2019, 2018, and 2017 is presented below:


		Weighted
		Average Grant		Weighted Average
(in thousands, except per share and		Date Fair		Remaining Term
remaining term data)	Shares	Value		(years)
Unvested at December 31, 2016	63	$	45.72	2.2
Granted	50		49.51
Vested	(28)		44.49
Forfeited	—		—
Unvested at December 31, 2017	85	$	48.34	2.6
Granted	65		58.11
Vested	(33)		47.34
Forfeited	—		—
Unvested at December 31, 2018	117	$	54.04	2.1
Granted	122		66.39
Vested	(42)		54.77
Forfeited	(5)		62.63
Unvested at December 31, 2019	192	$	61.46	2.6

As of December 31, 2019, there was $8.6 million of total unrecognized compensation cost related to non-vested RSAs granted under the Plan, which is expected to be recognized over a weighted-average period of 2.6 years.

INCOME TAXES

12 Months Ended

Dec. 31, 2019

INCOME TAXES

INCOME TAXES

11. INCOME TAXES

On August 6, 2018, ANI Canada acquired all the issued and outstanding equity interests of WellSpring in a non-taxable transaction (Note 2). Following the consummation of the transaction, WellSpring was merged into ANI Canada. For U.S. Federal and state income tax purposes, ANI Canada is not part of ANI’s consolidated group; rather, ANI Canada is subject to income taxes only in Canada and solely based on its stand-alone operations. The foreign current and foreign deferred provisions (benefits) below represent ANI Canada’s tax provision (benefit) from the Canadian taxing jurisdictions.

We are required to establish a valuation allowance for deferred tax assets if, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. We consider the projected future taxable income and tax planning strategies in making this assessment. As of December 31, 2018, we had provided a valuation allowance against our consolidated net deferred tax assets of $2.2 million.

As part of purchase accounting, as of the August 6, 2018 acquisition date the Company established net deferred tax assets relating to differences in the book bases (determined based on fair value purchase accounting) and tax bases (determined based on the carryover nature of the nontaxable transaction) of ANI Canada’s assets and liabilities of approximately $1.9 million, offset by a full valuation allowance due to our determination that it was more likely than not that all of the deferred tax assets will not be realized. During the second quarter 2019, we adopted an intercompany transfer pricing policy that uses the “comparable profits method” for pricing intercompany services between ANI Pharmaceuticals, Inc. and ANI Canada. For U.S. and Canadian tax purposes, the policy was adopted in conjunction with the acquisition date of August 6, 2018. As a result of the newly adopted transfer pricing policy, our assessment of the amount of ANI Canada’s deferred tax assets that are more likely than not to be realized changed and, as a result, during the second quarter 2019, we relased the remaining net valuation allowance related of ANI Canada’s deferred tax assets.

As of December 31, 2019, our consolidated valuation allowance was $0.4 million, related solely to deferred tax assets for net operating loss carryforwards in certain U.S. state jurisdictions.

Our total provision for income taxes consists of the following for the years ended December 31, 2019, 2018, and 2017:


(in thousands)	2019		2018		2017
Current income tax provision:
Federal	$	4,985	$	7,985	$	13,175
State		1,212		1,751		690
Total		6,197		9,736		13,865
Deferred income tax (benefit)/provision:
Federal		(6,274)		(4,630)		4,065
State		(2,027)		(556)		(556)
Foreign		1,000		(214)		—
Total		(7,301)		(5,400)		3,509
Change in valuation allowance		(1,833)		221		51
Total (benefit)/provision for income taxes	$	(2,937)	$	4,557	$	17,425

The difference between our expected income tax provision from applying U.S. Federal statutory tax rates to the pre-tax income and actual income tax provision relates primarily to the effect of the following:


	As of December 31,
	2019		2018		2017
US Federal statutory rate	21.0	%	21.0	%	35.0	%
State taxes, net of Federal benefit	3.2	%	2.4	%	2.0	%
Foreign taxes	0.4	%	26.5	%	—	%
Impact of Tax Cuts and Jobs Act	—	%	—	%	81.9	%
Domestic production activities deduction	—	%	—	%	(8.8)	%
Change in valuation allowance	(58.1)	%	(26.5)	%	—	%
Stock-based compensation	(6.7)	%	(1.8)	%	0.8	%
Non-deductible costs	9.1	%	—	%	0.5	%
Change in state apportionment factors, state and foreign rates	(28.1)	%	—	%	—	%
Research and experimentation and charitable credits	(33.5)	%	—	%	(2.5)	%
Transfer pricing and other	(0.2)	%	1.1	%	(2.3)	%
Total income tax (benefit)/provision	(93.0)	%	22.7	%	106.6	%

In 2017 our effective tax rate was impacted by the revaluation of our deferred tax assets and liabilities at the lower 21% U.S. corporate tax rate, as proscribed by the Tax Cuts and Jobs Act, which was enacted on December 22, 2017 and lowered the U.S. corporate tax rate from 35% to 21%, which began in 2018. We measure our deferred tax assets and liabilities using the tax rates that we believe will apply in the years in which the temporary differences are expected to be recovered or paid. As a result, we remeasured our deferred tax assets and deferred tax liabilities to reflect the reduction in the enacted U.S. corporate income tax rate, resulting in a net $13.4 million increase in income tax expense for the year ended December 31, 2017.

Deferred income taxes reflect the net tax effects of differences between the bases of assets and liabilities for financial reporting and income tax purposes. Our deferred income tax assets and liabilities consisted of the following:


	As of December 31,
(in thousands)	2019		2018
Deferred tax assets:
Accruals and advances	$	8,586	$	7,748
Stock-based compensation		3,750		—
Bond hedge		—		3,019
Accruals for chargebacks and returns		7,603		7,132
Inventory		4,720		1,228
Intangible asset		14,923		9,393
Net operating loss carryforwards		4,767		5,604
Other		1,459		4,682
Total deferred tax assets	$	45,808	$	38,806
Deferred tax liabilities:
Depreciation	$	(6,029)	$	(4,437)
Debt discount		—		(1,316)
Intangible assets		(13)		(11)
Other		(1,008)		(2,813)
Total deferred tax liabilities	$	(7,050)	$	(8,577)
Valuation allowance		(432)		(2,265)
Deferred tax assets, net of deferred tax liabilities and valuation allowance	$	38,326	$	27,964

As of December 31, 2019, we had U.S. federal net operating loss carryforwards of approximately $11.3 million, all of which arose as a result of the Merger and, if not used, expire in annual increments through 2033. The utilization of the net operating loss carryforwards are limited in future years as prescribed by Section 382 of the U.S. Internal Revenue Code; our current annual limitation of the federal net operating loss is approximately $0.8 million per year. Additionally, as of December 31, 2019 we have total net operating losses in Canada of $7.9 million that begin expiring in 2035.

We are subject to income taxes in numerous jurisdictions in the U.S. and in Canada. Significant judgment is required in evaluating our tax positions and determining our provision for income taxes. We establish liabilities for tax-related uncertainties based on estimates of whether, and the extent to which, additional taxes will be due. These liabilities are established when we believe that certain positions might be challenged despite our belief that our tax return positions are fully supportable. We adjust these liabilities in light of changing facts and circumstances, such as the outcome of a tax audit. The provision for income taxes includes the impact of changes to the liability that is considered appropriate. We identified no material uncertain tax positions as of December 31, 2019 and 2018.

We are subject to income tax audits in all jurisdictions for which we file tax returns. Tax audits by their nature are often complex and can require several years to complete. Neither ANI Pharmaceuticals, Inc. nor any of its subsidiaries is currently under audit in any jurisdiction. All of our income tax returns remain subject to examination by tax authorities due to the availability of net operating loss carryforwards.

COMMITMENTS AND CONTINGENCIES

12 Months Ended

Dec. 31, 2019

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

12. COMMITMENTS AND CONTINGENCIES

Operating Leases

All our existing leases as of December 31, 2019 are classified as operating leases. As of December 31,2019, we have twelve material operating leases for facilities and office equipment with remaining terms expiring from 2021 through 2024 and a weighted average remaining lease term of 2.4 years. Many of our existing leases have fair value renewal options, none of which are considered certain of being exercised or included in the minimum lease term. Discount rates used in the calculation of our lease liability ranged between 4.02% and 8.95%.

Rent expense for the year ended December 31, 2019 consisted of the following:


(in thousands)
Operating lease costs	$	190
Variable lease costs		60
Total lease costs	$	250

A maturity analysis of our operating leases follows:


(in thousands)
Future payments:
2020	$	214
2021		152
2022		111
2023		40
2024		3
Total	$	520

Discount		(31)
Lease liability		489
Current lease liability		(197)
Non-current lease liability	$	292

Future minimum lease payments under non-cancelable operating leases as of December 31, 2018 were approximately $0.1 million per year from 2019 through 2022.

Vendor Purchase Minimums

We have supply agreements with four vendors that include purchase minimums. Pursuant to these agreements, we will be required to purchase a total of $15.2 million of API from these four vendors during the year ended December 31, 2020.

Government Regulation

Our products and facilities are subject to regulation by a number of federal and state governmental agencies. The FDA, in particular, maintains oversight of the formulation, manufacture, distribution, packaging, and labeling of all of our products. The Drug Enforcement Administration ("DEA") maintains oversight over our products that are considered controlled substances.

Unapproved Products

Two of our products, Esterified Estrogen with Methyltestosterone (“EEMT”) and Opium Tincture, are marketed without approved NDAs or ANDAs. During the years ended December 31, 2019, 2018, and 2017, net revenues for these products totaled $20.7 million, $24.9 million, and $27.6 million, respectively.

The FDA’s policy with respect to the continued marketing of unapproved products is stated in the FDA’s September 2011 Compliance Policy Guide Sec. 440.100 titled “Marketed New Drugs without Approved NDAs or ANDAs.” Under this policy, the FDA has stated that it will follow a risk-based approach with regard to enforcement against such unapproved products. The FDA evaluates whether to initiate enforcement action on a case-by-case basis, but gives higher priority to enforcement action against products in certain categories, such as those marketed as unapproved drugs with potential safety risks or that lack evidence of effectiveness. We believe that, so long as we comply with applicable manufacturing standards, the FDA will not take action against us under the current enforcement policy. There can be no assurance, however, that the FDA will continue this policy or not take a contrary position with any individual product or group of products. If the FDA were to take a contrary position, we may be required to seek FDA approval for these products or withdraw such products from the market. If we decide to withdraw the products from the market, our net revenues for generic pharmaceutical products would decline materially, and if we decide to seek FDA approval, we would face increased expenses and might need to suspend sales of the products until such approval was obtained, and there are no assurances that we would receive such approval.

In addition, one group of products that we manufacture on behalf of a contract customer is marketed by that customer without an approved NDA. If the FDA took enforcement action against such customer, the customer may be required to seek FDA approval for the group of products or withdraw them from the market. Our contract manufacturing revenues for the group of unapproved products for the years ended December 31, 2019, 2018, and 2017 were $3.1 million, $2.0 million, and $2.0 million, respectively.

Legal proceedings

We are involved, and f om time to time may become involved, in various disputes, governmental and/or regulatory inquiries, investigations, and litigation matters, some of which could result in losses, including damages, fines, and/or civil or criminal penalties against us. These matters are often complex and have outcomes that we are unable to predict.

We intend to vigorously defend ourselves in these matters and believe that we have strong defenses regarding the claims currently asserted against us. However, from time to time, we may settle or otherwise resolve these matters on terms and conditions that we believe are in our best interests. Resolution of any or all claims, investigations, and legal proceedings, individually or in the aggregate, could have a material adverse effect on our results of operations and/or cash flows in any given accounting period or on our overall financial condition.

Some of these matters with which we are involved are described below, and unless otherwise disclosed, we are unable to predict the outcome of the matter or to provide an estimate of the range of reasonably possible material losses. We record accruals for loss contingencies to the extent we conclude it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. From time to time, we are also involved in other pending proceedings for which, in our opinion based upon facts and circumstances known at the time, either the likelihood of loss is remote or any reasonably possible loss associated with the resolution of such proceedings is not expected to be material to our results. If and when any reasonably possible losses associated with the resolution of such other pending proceedings. in our opinion, become material, we will disclose such matters.

Louisiana Medicaid Lawsuit

On September 11, 2013, the Attorney General of the State of Louisiana filed a lawsuit in Louisiana state court against numerous pharmaceutical companies, including us, under various state laws, alleging that each defendant caused the state’s Medicaid agency to provide reimbursement for drug products that allegedly were not approved by the FDA and therefore allegedly not reimbursable under the federal Medicaid program. The lawsuit relates to three cough and cold prescription products manufactured and sold by our former Gulfport, Mississippi operation, which was sold in September 2010. Through its lawsuit, the state seeks unspecified damages, statutory fines, penalties, attorneys’ fees, and costs. While we cannot predict the outcome of the lawsuit at this time, we could be subject to material damages, penalties, and fines. We intend to vigorously defend against all claims in the lawsuit.

Civil Action

In November of 2017, we were served with a complaint filed by Arbor Pharmaceuticals, LLC, in the United States District Court, District of Minnesota. The complaint alleges false advertising and unfair competition in violation of Section 43(a) of the Lanham Act, Section 1125(a) of Title 15 of the United States Code, and Minnesota State law, and seeks injunctive relief and damages. Discovery in this action closed on March 31, 2019. Trial is expected to be scheduled for October 2020. We continue to defend this action vigorously.

Other Commitments and Contingencies

All manufacturers of the drug Reglan and its generic equivalent metoclopramide, including ANI, have faced allegations from plaintiffs in various states claiming bodily injuries as a result of ingestion of metoclopramide or its brand name, Reglan, prior to the FDA's February 2009 Black Box warning requirement (“legacy claims”). All these original legacy claims were settled or closed out, including a series of claims in California that were resolved by coordinated proceeding and settlement. At the end of March 2019, we were served with a lawsuit in the Superior Court of California, County of Riverside, adding us as a defendant in a complaint filed in July 2017 that is alleged not to have been part of the original settled legacy claims. This new claim as well as the impact of the prior settlements on this claim is currently being evaluated by the Company, its insurers, and its legal counsel.

At the present time, we are unable to assess the likely outcome of the case. Our insurance company had assumed the defense of the legacy claims and paid all losses in settlement of the California cases. We cannot provide assurances that the outcome of this new matter will not have an adverse effect on our business, financial condition, and operating results. Furthermore, like all pharmaceutical manufacturers, we may be exposed to other product liability claims in the future, which could limit our coverage under future insurance policies or cause those policies to become more expensive, which could harm our business, financial condition, and operating results.

Our ANDA for Erythromycin Ethylsuccinate (“EES”) was originally approved by the FDA on November 27th, 1978. We purchased the EES ANDA from Teva on July 10, 2015. In August 2016, we filed with the FDA to reintroduce this product under a Changes Being Effected in 30 Days submission (a “CBE-30 submission”). Under a CBE-30 submission, certain defined changes to an ANDA can be made if the FDA does not object in writing within 30 days. The FDA’s regulations, guidance documents, and our historic actions support the filing of a CBE-30 for the types of changes that we proposed for our EES ANDA. We received no formal written letter from the FDA within 30 days of the CBE-30 submission date, and as such, launched the product in accordance with FDA regulations on September 27, 2016. On December 16, 2016, and nearly four months after our CBE-30 submission, the FDA sent us a formal written notice that a Prior Approval Supplement (“PAS”) was required for this ANDA. Under a PAS, proposed changes to an ANDA cannot be implemented without prior review and approval by the FDA. Because we did not receive this notice in the timeframe prescribed by the FDA’s regulations, we reserved our legal right to an internal Agency appeal. We believe that our supplemental ANDA is valid, and as such continued to market the product. In addition, we filed a PAS which was approved by the FDA on November 2, 2018 with no FDA objection to our prior actions.

On or about September 20, 2017, the Company and certain of its employees were served with search warrants and/or grand jury subpoenas to produce documents and possibly testify relating to a federal investigation of the generic pharmaceutical industry. The Company has been cooperating and intends to continue cooperating with the investigation. However, no assurance can be given as to the timing or outcome of the investigation.

CORTROPHIN PRE-LAUNCH CHARGES	12 Months Ended
CORTROPHIN PRE-LAUNCH CHARGES	Dec. 31, 2019
CORTROPHIN PRE-LAUNCH CHARGES
CORTROPHIN PRE-LAUNCH CHARGES	13. CORTROPHIN PRE-LAUNCH CHARGES In January 2016, we acquired the right, title and interest in the NDAs for Cortrophin Gel and Cortrophin-Zinc. Subsequently, we have assembled a Cortrophin re-commercialization team of scientists, executed a long-term supply agreement with a supplier of pig pituitary glands, our primary raw material for corticotrophin API, executed a long-term supply agreement with an API manufacturer, with whom we have advanced the manufacture of corticotropin API via manufacture of commercial-scale batches, and executed a long-term commercial supply agreement with a current good manufacturing practice (“cGMP”) aseptic fill contract manufacturer. Prior to the third and fourth quarter 2019, all purchases of material, including pig pituitary glands and API, related to the re-commercialization efforts have been consumed in research and development activities and recognized as research and development expense in the period in which they were incurred. In the third quarter of 2019, we began purchasing materials that are intended to be used commercially in anticipation of FDA approval of Cortrophin Gel and the resultant product launch. Under U.S. GAAP, we cannot capitalize these pre-launch purchases of materials as inventory prior to FDA approval, and accordingly, they are charged to expense in the period in which they are incurred. We expect these pre-launch purchases of material to increase significantly in the future as we build raw materials, API and finished goods for the expected launch of this product. During the year ended December 31, 2019, we incurred related charges for the purchase of materials of $6.7 million. We currently project expense related to this activity to be approximately $11.0 - $12.0 million for 2020. In the future, we also expect to incur other charges directly related to the Cortrophin pre-launch commercialization efforts, including, but not limited to, sales and marketing and consulting expenses, which will vary in frequency and impact on our results of operations.

SUBSEQUENT EVENTS	12 Months Ended
SUBSEQUENT EVENTS	Dec. 31, 2019
SUBSEQUENT EVENTS
Subsequent Events	14. SUBSEQUENT EVENTS On January 8, 2020 we acquired the U.S. portfolio of 23 generic products from Amerigen Pharmaceuticals, Ltd. for $52.5 million in cash at close and up to $25.0 million in contingent profit share payments over the next four years. The contingent payments will be earned when annual gross profit exceeds a minimum threshold and will be earned on a subset of the acquired products. The acquired portfolio includes ten commercial products, three approved products with launches pending, four filed products, and four in-development products as well as a license to commercialize two approved products. We also made a $4.0 million cash payment to Amerigen to acquire certain commercial and development inventory and materials. The transaction was funded from cash on hand. On January 17, 2020, ANI Pharmaceuticals, Inc. (the “Company”) entered into employment agreements with its (i) President and Chief Executive Officer, Arthur S. Przybyl, (ii) Vice President of Finance and Chief Financial Officer, Stephen P. Carey, (iii) Senior Vice President of Business Development and Specialty Sales, Robert Schrepfer and (iv) Senior Vice President of Operations and Product Development, James G. Marken.

QUARTERLY FINANCIAL DATA

12 Months Ended

Dec. 31, 2019

Quarterly Financial Data [Abstract]

QUARTERLY FINANCIAL DATA

15. QUARTERLY FINANCIAL DATA (unaudited)

The following table presents unaudited quarterly consolidated operating results for each of our last eight fiscal quarters. The information below has been prepared on a basis consistent with our audited consolidated financial statements.


	2019 Quarters (unaudited)
(in thousands, except per share data)	First		Second		Third		Fourth(1)
Net revenues	$	52,887	$	54,357	$	51,337	$	47,966
Total operating expenses		48,485		45,065		44,009		52,637
Operating income/(expense)		4,402		9,292		7,328		(4,671)
(Provision)/benefit for income taxes		(469)		653		(64)		2,817
Net income/(loss)	$	449	$	6,585	$	3,895	$	(4,835)
Basic and diluted earnings/(loss) per share:
Basic earnings/(loss) per share	$	0.04	$	0.55	$	0.32	$	(0.41)
Diluted earnings/(loss) per share	$	0.04	$	0.53	$	0.32	$	(0.41)

⁽¹⁾

During the fourth quarter 2019, we recognized a $4.6 million inventory reserve charge, primarily related to our exit from the market of Methylphenidate Extended Release. We also recognized Cortrophin pre-launch charges of $6.5 million.


	2018 Quarters (unaudited)
(in thousands, except per share data)	First		Second		Third		Fourth
Net revenues	$	46,483	$	47,268	$	50,703	$	57,122
Total operating expenses		39,946		40,005		40,589		45,677
Operating income		6,537		7,263		10,114		11,445
Provision for income taxes		(592)		(726)		(1,329)		(1,910)
Net income	$	2,250	$	2,777	$	5,037	$	5,430
Basic and diluted earnings per share:
Basic earnings per share	$	0.19	$	0.24	$	0.43	$	0.46
Diluted earnings per share	$	0.19	$	0.23	$	0.42	$	0.46

DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

12 Months Ended

Dec. 31, 2019

BUSINESS, PRESENTATION, AND RECENT ACCOUNTING PRONOUNCEMENTS

Organization and Business

Basis of Presentation

Principles of Consolidation

The consolidated financial statements include the accounts of ANI Pharmaceuticals, Inc. and its subsidiaries. All intercompany accounts and transactions are eliminated in consolidation.

Comprehensive income, which is reported in the statement of comprehensive income, consists of net income, changes in fair value of our interest rate swap, and other comprehensive income, net of tax.

Credit Concentration

Our customers are primarily wholesale distributors, chain drug stores, group purchasing organizations, and other pharmaceutical companies.

Vendor Concentration

Revenue Recognition

We recognize revenue using the following steps:

Identification of the contract, or contracts, with a customer;

Identification of the performance obligations in the contract;

Determination of the transaction price, including the identification and estimation of variable consideration;

Allocation of the transaction price to the performance obligations in the contract; and

Recognition of revenue when we satisfy a performance obligation.

All revenue recognized in our consolidated statements of operations is considered to be revenue from contracts with customers. The following table depicts the disaggregation of revenue:


Products and Services	Years Ended December 31,
(in thousands)	2019		2018		2017
Sales of generic pharmaceutical products	$	128,729	$	117,451	$	118,437
Sales of branded pharmaceutical products		63,767		60,554		50,919
Sales of contract manufactured products		11,139		9,119		7,046
Royalties from licensing agreements		807		12,504		—
Product development services		1,125		1,019		—
Other(1)		980		929		440
Total net revenues	$	206,547	$	201,576	$	176,842

⁽¹⁾

Primarily includes laboratory services and royalties on sales of contract manufactured products


Timing of Revenue Recognition	Years Ended December 31,
(in thousands)	2019		2018		2017
Performance obligations transferred at a point in time	$	205,422	$	200,557	$	176,842
Performance obligations transferred over time		1,125		1,019		—
Total	$	206,547	$	201,576	$	176,842

Revenue from Sales of Generic and Branded Pharmaceutical Products

Revenue from Distribution Agreements

Chargebacks

Chargeback credits are calculated as follows:

A change in customer mix

A change in negotiated terms with customers

A change in the volume of off-contract purchases

Changes in WAC

As necessary, we adjust ASPs based on anticipated changes in the factors above.

Government Rebates

Returns

Administrative Fees and Other Rebates

Prompt Payment Discounts

The following table summarizes activity in the consolidated balance sheets for accruals and allowances for the years ended December 31, 2019, 2018, and 2017:


	Accruals for Chargebacks, Returns, and Other Allowances
							Administrative		Prompt
			Government				Fees and Other		Payment
(in thousands)	Chargebacks		Rebates		Returns		Rebates		Discounts
Balance at December 31, 2016	$	26,785	$	5,891	$	5,756	$	3,550	$	1,554
Accruals/Adjustments		179,297		12,237		12,184		24,037		8,126
Credits Taken Against Reserve		(177,852)		(10,198)		(9,666)		(22,361)		(7,846)
Balance at December 31, 2017	$	28,230	$	7,930	$	8,274	$	5,226	$	1,834
Accruals/Adjustments		229,813		11,383		14,243		33,167		9,371
Credits Taken Against Reserve		(219,036)		(10,339)		(9,965)		(31,040)		(9,196)
Balance at December 31, 2018	$	39,007	$	8,974	$	12,552	$	7,353	$	2,009
Accruals/Adjustments		260,771		17,549		19,105		36,874		10,789
Credits Taken Against Reserve		(249,896)		(17,622)		(15,062)		(35,946)		(10,249)
Balance at December 31, 2019	$	49,882	$	8,901	$	16,595	$	8,281	$	2,549

Contract Manufacturing Product Sales Revenue

Royalties from Licensing Agreements

Product Development Services Revenue

Cash and Cash Equivalents

Cash, Cash Equivalents, and Restricted Cash

Accounts Receivable

Inventories

Property and Equipment


Buildings and improvements	20 - 40 years
Machinery, furniture, and equipment	1 - 10 years

Intangible Assets

Goodwill

Collaborative Arrangements

Royalties

Research and Development Expenses

Stock-Based Compensation

Income Taxes

Earnings (Loss) per Share

Basic earnings (loss) per share is computed by dividing net income available to common shareholders by the weighted-average number of shares of common stock outstanding during the period.

The numerator for earnings per share for the years ended December 31, 2019, 2018, and 2017 are calculated for basic and diluted earnings (loss) per share as follows:


	Basic						Diluted
(in thousands, except per share amounts)	Years Ended December 31,						Years Ended December 31,
	2019		2018		2017		2019		2018		2017
Net income/(loss)	$	6,094	$	15,494	$	(1,076)	$	6,094	$	15,494	$	(1,076)
Net income allocated to restricted stock		(97)		(154)		—		(97)		(154)		—
Net income/(loss) allocated to common shares	$	5,997	$	15,340	$	(1,076)	$	5,997	$	15,340	$	(1,076)
Basic Weighted-Average Shares Outstanding		11,841		11,677		11,547		11,841		11,677		11,547
Dilutive effect of stock options and ESPP								103		95		—
Dilutive effect of Notes								96		—		—
Diluted Weighted-Average Shares Outstanding								12,040		11,772		11,547
Earnings/(Loss) per share	$	0.51	$	1.31	$	(0.09)	$	0.50	$	1.30	$	(0.09)

Hedge Accounting

Fair Value of Financial Instruments

Level 2—Observable market-based inputs other than quoted prices in active markets for identical assets or liabilities.

Level 3—Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs.

See Note 8 for additional information regarding fair value.

Geographic Information

The following table depicts the Company’s revenue by geographic operations during the following periods:


(in thousands)	Years Ended December 31,
Location of Operations	2019		2018		2017
United States	$	199,663	$	196,886	$	176,842
Canada		6,884		4,690		—
Total Revenue	$	206,547	$	201,576	$	176,842

The following table depicts the Company’s property and equipment, net according to geographic location as of:


(in thousands)	December 31,		December 31,
	2019		2018
United States	$	26,708	$	24,437
Canada		13,843		13,653
Total property and equipment, net	$	40,551	$	38,090

Recent Accounting Pronouncements

Recent Accounting Pronouncements Not Yet Adopted

We will adopt this guidance as of January 1, 2020. The adoption of this guidance is not expected to have a material impact on our consolidated financial statements.

Recently Adopted Accounting Pronouncements

We did not reassess if any expired or existing contracts are or contain leases;

We did not reassess the classification of any expired or existing leases.

DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

12 Months Ended

Dec. 31, 2019

BUSINESS, PRESENTATION, AND RECENT ACCOUNTING PRONOUNCEMENTS

Schedule of disaggregation of revenue and revenue recognized

The following table depicts the disaggregation of revenue:


Products and Services	Years Ended December 31,
(in thousands)	2019		2018		2017
Sales of generic pharmaceutical products	$	128,729	$	117,451	$	118,437
Sales of branded pharmaceutical products		63,767		60,554		50,919
Sales of contract manufactured products		11,139		9,119		7,046
Royalties from licensing agreements		807		12,504		—
Product development services		1,125		1,019		—
Other(1)		980		929		440
Total net revenues	$	206,547	$	201,576	$	176,842

⁽¹⁾

Primarily includes laboratory services and royalties on sales of contract manufactured products


Timing of Revenue Recognition	Years Ended December 31,
(in thousands)	2019		2018		2017
Performance obligations transferred at a point in time	$	205,422	$	200,557	$	176,842
Performance obligations transferred over time		1,125		1,019		—
Total	$	206,547	$	201,576	$	176,842

Schedule of Valuation and Qualifying Accounts Disclosure

The following table summarizes activity in the consolidated balance sheets for accruals and allowances for the years ended December 31, 2019, 2018, and 2017:


	Accruals for Chargebacks, Returns, and Other Allowances
							Administrative		Prompt
			Government				Fees and Other		Payment
(in thousands)	Chargebacks		Rebates		Returns		Rebates		Discounts
Balance at December 31, 2016	$	26,785	$	5,891	$	5,756	$	3,550	$	1,554
Accruals/Adjustments		179,297		12,237		12,184		24,037		8,126
Credits Taken Against Reserve		(177,852)		(10,198)		(9,666)		(22,361)		(7,846)
Balance at December 31, 2017	$	28,230	$	7,930	$	8,274	$	5,226	$	1,834
Accruals/Adjustments		229,813		11,383		14,243		33,167		9,371
Credits Taken Against Reserve		(219,036)		(10,339)		(9,965)		(31,040)		(9,196)
Balance at December 31, 2018	$	39,007	$	8,974	$	12,552	$	7,353	$	2,009
Accruals/Adjustments		260,771		17,549		19,105		36,874		10,789
Credits Taken Against Reserve		(249,896)		(17,622)		(15,062)		(35,946)		(10,249)
Balance at December 31, 2019	$	49,882	$	8,901	$	16,595	$	8,281	$	2,549

Schedule of Earnings per share, basic and diluted

The numerator for earnings per share for the years ended December 31, 2019, 2018, and 2017 are calculated for basic and diluted earnings (loss) per share as follows:


	Basic						Diluted
(in thousands, except per share amounts)	Years Ended December 31,						Years Ended December 31,
	2019		2018		2017		2019		2018		2017
Net income/(loss)	$	6,094	$	15,494	$	(1,076)	$	6,094	$	15,494	$	(1,076)
Net income allocated to restricted stock		(97)		(154)		—		(97)		(154)		—
Net income/(loss) allocated to common shares	$	5,997	$	15,340	$	(1,076)	$	5,997	$	15,340	$	(1,076)
Basic Weighted-Average Shares Outstanding		11,841		11,677		11,547		11,841		11,677		11,547
Dilutive effect of stock options and ESPP								103		95		—
Dilutive effect of Notes								96		—		—
Diluted Weighted-Average Shares Outstanding								12,040		11,772		11,547
Earnings/(Loss) per share	$	0.51	$	1.31	$	(0.09)	$	0.50	$	1.30	$	(0.09)

Schedule of revenue from company's revenue by geographic operations

The following table depicts the Company’s revenue by geographic operations during the following periods:


(in thousands)	Years Ended December 31,
Location of Operations	2019		2018		2017
United States	$	199,663	$	196,886	$	176,842
Canada		6,884		4,690		—
Total Revenue	$	206,547	$	201,576	$	176,842

Schedule of company's property and equipment, net according to geographic location

The following table depicts the Company’s property and equipment, net according to geographic location as of:


(in thousands)	December 31,		December 31,
	2019		2018
United States	$	26,708	$	24,437
Canada		13,843		13,653
Total property and equipment, net	$	40,551	$	38,090

BUSINESS COMBINATION (Tables)

12 Months Ended

Dec. 31, 2019

BUSINESS COMBINATION

Schedule of final allocation of the purchase price to the assets acquired and liabilities assumed

The following presents the final allocation of the purchase price to the assets acquired and liabilities assumed on August 6, 2018:


	(in thousands)
Total Purchase Consideration	$	16,687
Cash and cash equivalents		220
Accounts receivable		1,311
Inventories		2,197
Prepaid expenses and other current assets		361
Property and equipment		13,935
Goodwill		1,742
Total assets acquired		19,766
Accounts payable and other current liabilities		2,413
Deferred revenue		666
Total liabilties assumed		3,079
Net assets acquired	$	16,687

Schedule of unaudited proforma condensed financial information for the results of operations


	Years Ended December 31,
(in thousands)	2018		2017(1)
Net revenues	$	208,213	$	188,758
Net income/(loss)	$	13,287	$	(3,102)

Net loss for the year ended December 31, 2017 includes the impact to WellSpring of $4.4 million of related party debt forgiveness.

INDEBTEDNESS (Tables)

12 Months Ended

Dec. 31, 2019

INDEBTEDNESS

Schedule of carrying value of the current and non-current components of the term loan

The carrying value of the current and non-current components of the Term Loan and DDTL as of December 31, 2019 and 2018 are:


	Current
(in thousands)	2019		2018
Current borrowing on secured Term Loan and Delayed Draw Term Loan	$	10,412	$	3,609
Deferred financing costs		(471)		(353)
Current component of Term Loan and Delayed Draw Term Loan, net of deferred financing costs	$	9,941	$	3,256


	Non-Current
(in thousands)	2019		2018
Non-current borrowing on secured Term Loan and Delayed Draw Term Loan	$	177,069	$	68,578
Deferred financing costs		(1,261)		(1,282)
Term Loan and Delayed Draw Term Loan, net of deferred financing costs and current component	$	175,808	$	67,296

Schedule of contractual maturity of term loan and DDTL

The contractual maturity of our Term Loan and DDTL is as follows for the years ending December 31:


(in thousands)	Term Loan		DDTL
2020	$	4,512	$	5,900
2021		5,414		5,900
2022		5,414		8,850
2023		54,141		97,350
Total	$	69,481	$	118,000

Summary of carrying value of the notes

The carrying value of the Notes is as follows as of December 31:


(in thousands)	2019		2018
Principal amount	$	—	$	118,750
Unamortized debt discount		—		(5,648)
Deferred financing costs		—		(639)
Net carrying value	$	—	$	112,463

Schedule of components of total interest expense related to the notes and term loan


(in thousands)	2019		2018		2017
Contractual coupon	$	6,635	$	7,170	$	4,313
Amortization of debt discount		5,647		7,002		6,720
Amortization of finance fees		1,377		1,463		845
Capitalized interest		(191)		(724)		(554)
	$	13,468	$	14,911	$	11,324

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

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+ Details

INVENTORIES (Tables)

12 Months Ended

Dec. 31, 2019

INVENTORIES

Schedule of Inventories

Inventories consist of the following as of December 31:


(in thousands)	2019		2018(1)
Raw materials	$	34,881	$	27,671
Packaging materials		2,902		2,563
Work-in-progress		361		1,210
Finished goods		16,750		10,620
		54,894		42,064
Reserve for excess/obsolete inventories		(6,731)		(1,561)
Inventories, net	$	48,163	$	40,503

⁽¹⁾

Includes inventory acquired in acquisition of WellSpring (Note 2).

PROPERTY, PLANT, AND EQUIPMENT (Tables)

12 Months Ended

Dec. 31, 2019

PROPERTY, PLANT, AND EQUIPMENT

Schedule of Property, plant and equipment

Property, plant, and equipment consist of the following as of December 31:


(in thousands)	2019		2018(1)
Land	$	4,566	$	4,558
Buildings		10,275		10,079
Machinery, furniture, and equipment		34,984		26,814
Construction in progress		3,496		5,040
		53,321		46,491
Less: accumulated depreciation		(12,770)		(8,401)
Property and equipment, net	$	40,551	$	38,090

⁽¹⁾

Includes property and equipment acquired in acquisition of WellSpring (Note 2).

INTANGIBLE ASSETS (Tables)

12 Months Ended

Dec. 31, 2019

INTANGIBLE ASSETS

Schedule Of Goodwill

Changes in the carrying amount of goodwill as of December 31 are as follows:


(in thousands)	2019		2018
Balance at beginning of year	$	3,580	$	1,838
Acquisition of WellSpring (Note 2)		—		1,742
Balance at end of year	$	3,580	$	3,580

Schedule of components of net definite-lived intangible assets

The components of net definite-lived intangible assets are as follows:


	December 31, 2019				December 31, 2018				Weighted Average
	Gross Carrying		Accumulated		Gross Carrying		Accumulated		Amortization
(in thousands)	Amount		Amortization		Amount		Amortization		Period
Acquired ANDA intangible assets	$	64,704	$	(30,169)	$	46,194	$	(17,093)	10.0 years
NDAs and product rights		230,974		(87,352)		230,974		(62,222)	10.0 years
Marketing and distribution rights		10,923		(8,982)		10,423		(7,051)	4.7 years
Non-compete agreement		624		(334)		624		(245)	7.0 years
	$	307,225	$	(126,837)	$	288,215	$	(86,611)	10.0 years

Schedule of expected future amortization expense

Expected future amortization expense is as follows for the years ending December 31:


(in thousands)
2020	$	33,180
2021		31,734
2022		28,329
2023		27,581
2024		24,604
2025 and thereafter		34,960
Total	$	180,388

FAIR VALUE DISCLOSURES (Tables)

12 Months Ended

Dec. 31, 2019

FAIR VALUE DISCLOSURES

Schedule of financial assets and liabilities accounted for at fair value on a recurring basis


(in thousands)	Fair Value at
Description	December 31, 2019		Level 1		Level 2		Level 3
Liabilities
Interest rate swaps	$	6,215	$	—	$	6,215	$	—
CVRs	$	—	$	—	$	—	$	—


	Fair Value at
Description	December 31, 2018		Level 1		Level 2		Level 3
Liabilities
Interest rate swaps	$	496	$	—	$	496	$	—
CVRs	$	—	$	—	$	—	$	—

STOCKHOLDERS' EQUITY (Tables)

12 Months Ended

Dec. 31, 2019

Stockholders' Equity Note [Abstract]

Schedule of Stockholders' Equity Note, Warrants or Rights

Warrants to purchase an aggregate of 1.7 million shares of our common stock were outstanding and exercisable as of December 31, 2019:


	Number of
	Underlying Shares
	of Common Stock	Per Share		First
Issue Date	(in thousands)	Exercise Price		Expiration Date
December 4, 2014	1,486	$	96.21	March 1, 2020
December 5, 2014	223	$	96.21	March 1, 2020

STOCK-BASED COMPENSATION (Tables)

12 Months Ended

Dec. 31, 2019

STOCK-BASED COMPENSATION

Summary of ESPP expense incurred under the 2016 Employee Stock Purchase Plan and stock-based compensation expense incurred

The following table summarizes ESPP expense incurred under the 2016 Employee Stock Purchase Plan and included in our accompanying consolidated statements of operations:


(in thousands)	Years Ended December 31,
	2019		2018		2017
Cost of sales	$	18	$	11	$	6
Research and development		29		16		1
Selling, general, and administrative		100		75		61
	$	147	$	102	$	68

The following table summarizes stock-based compensation expense incurred under the 2008 Plan and included in our consolidated statements of operations:


	Years Ended December 31,
(in thousands)	2019		2018		2017
Cost of sales	$	101	$	87	$	86
Research and development		756		771		677
Selling, general, and administrative		8,213		5,822		5,259
	$	9,070	$	6,680	$	6,022

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions

For 2019, 2018, and 2017, the fair value of each option grant was estimated using the Black-Scholes option-pricing model, using the following assumptions:


	Years Ended December 31,
	2019	2018	2017
Expected option life (years)	5.50 - 6.25	5.48 - 6.25	5.33 - 7.00
Risk-free interest rate	1.91% - 2.58%	2.64% - 2.93%	1.93% - 2.33%
Expected stock price volatility	63.1% - 66.7%	55.1% - 60.6%	50.3% - 57.4%
Dividend yield	—	—	—

Summary of Stock option and restricted stock activity

A summary of stock option activity under the 2008 Plan during the years ended December 31, 2019, 2018, and 2017 is presented below:


				Weighted		Weighted
				Average		Average
		Weighted		Grant-		Remaining
(in thousands, except per share and	Option	Average		date		Term	Aggregate
remaining term data)	Shares	Exercise Price		Fair Value		(years)	Intrinsic Value
Outstanding December 31, 2016	578	$	39.28			8.2	$	12,928
Granted	207		51.66	$	27.04
Exercised	(13)		15.92					542
Forfeited	(5)		53.29
Expired	—		—
Outstanding December 31, 2017	767	$	42.93			7.8	$	16,785
Granted	156		57.60	$	31.76
Exercised	(142)		19.47					5,863
Forfeited	(18)		60.17
Expired	(4)		74.53
Outstanding at December 31, 2018	759	$	49.74			7.6	$	2,221
Granted	160		65.97	$	40.14
Exercised	(130)		41.99					3,335
Forfeited	(31)		56.66
Expired	(1)		54.36
Outstanding at December 31, 2019	757	$	54.21			7.2	$	6,761
Exercisable at December 31, 2019	366	$	50.47			6.2	$	4,469

Non-vested Restricted Stock Shares Activity

A summary of RSA activity under the Plan during the years ended December 31, 2019, 2018, and 2017 is presented below:


		Weighted
		Average Grant		Weighted Average
(in thousands, except per share and		Date Fair		Remaining Term
remaining term data)	Shares	Value		(years)
Unvested at December 31, 2016	63	$	45.72	2.2
Granted	50		49.51
Vested	(28)		44.49
Forfeited	—		—
Unvested at December 31, 2017	85	$	48.34	2.6
Granted	65		58.11
Vested	(33)		47.34
Forfeited	—		—
Unvested at December 31, 2018	117	$	54.04	2.1
Granted	122		66.39
Vested	(42)		54.77
Forfeited	(5)		62.63
Unvested at December 31, 2019	192	$	61.46	2.6

INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2019

INCOME TAXES

Schedule of Components of Income Tax Expense (Benefit)

Our total provision for income taxes consists of the following for the years ended December 31, 2019, 2018, and 2017:


(in thousands)	2019		2018		2017
Current income tax provision:
Federal	$	4,985	$	7,985	$	13,175
State		1,212		1,751		690
Total		6,197		9,736		13,865
Deferred income tax (benefit)/provision:
Federal		(6,274)		(4,630)		4,065
State		(2,027)		(556)		(556)
Foreign		1,000		(214)		—
Total		(7,301)		(5,400)		3,509
Change in valuation allowance		(1,833)		221		51
Total (benefit)/provision for income taxes	$	(2,937)	$	4,557	$	17,425

Schedule of Effective Income Tax Rate Reconciliation


	As of December 31,
	2019		2018		2017
US Federal statutory rate	21.0	%	21.0	%	35.0	%
State taxes, net of Federal benefit	3.2	%	2.4	%	2.0	%
Foreign taxes	0.4	%	26.5	%	—	%
Impact of Tax Cuts and Jobs Act	—	%	—	%	81.9	%
Domestic production activities deduction	—	%	—	%	(8.8)	%
Change in valuation allowance	(58.1)	%	(26.5)	%	—	%
Stock-based compensation	(6.7)	%	(1.8)	%	0.8	%
Non-deductible costs	9.1	%	—	%	0.5	%
Change in state apportionment factors, state and foreign rates	(28.1)	%	—	%	—	%
Research and experimentation and charitable credits	(33.5)	%	—	%	(2.5)	%
Transfer pricing and other	(0.2)	%	1.1	%	(2.3)	%
Total income tax (benefit)/provision	(93.0)	%	22.7	%	106.6	%

Schedule of Deferred Tax Assets and Liabilities


	As of December 31,
(in thousands)	2019		2018
Deferred tax assets:
Accruals and advances	$	8,586	$	7,748
Stock-based compensation		3,750		—
Bond hedge		—		3,019
Accruals for chargebacks and returns		7,603		7,132
Inventory		4,720		1,228
Intangible asset		14,923		9,393
Net operating loss carryforwards		4,767		5,604
Other		1,459		4,682
Total deferred tax assets	$	45,808	$	38,806
Deferred tax liabilities:
Depreciation	$	(6,029)	$	(4,437)
Debt discount		—		(1,316)
Intangible assets		(13)		(11)
Other		(1,008)		(2,813)
Total deferred tax liabilities	$	(7,050)	$	(8,577)
Valuation allowance		(432)		(2,265)
Deferred tax assets, net of deferred tax liabilities and valuation allowance	$	38,326	$	27,964

COMMITMENTS AND CONTINGENCIES (Tables)

12 Months Ended

Dec. 31, 2019

COMMITMENTS AND CONTINGENCIES

Schedule of rent expense

Rent expense for the year ended December 31, 2019 consisted of the following:


(in thousands)
Operating lease costs	$	190
Variable lease costs		60
Total lease costs	$	250

Schedule of maturity analysis of operating leases

A maturity analysis of our operating leases follows:


(in thousands)
Future payments:
2020	$	214
2021		152
2022		111
2023		40
2024		3
Total	$	520

Discount		(31)
Lease liability		489
Current lease liability		(197)
Non-current lease liability	$	292

QUARTERLY FINANCIAL DATA (Tables)

12 Months Ended

Dec. 31, 2019

Quarterly Financial Information Disclosure [Abstract]

Schedule of Quarterly Financial Information

The information below has been prepared on a basis consistent with our audited consolidated financial statements.


	2019 Quarters (unaudited)
(in thousands, except per share data)	First		Second		Third		Fourth(1)
Net revenues	$	52,887	$	54,357	$	51,337	$	47,966
Total operating expenses		48,485		45,065		44,009		52,637
Operating income/(expense)		4,402		9,292		7,328		(4,671)
(Provision)/benefit for income taxes		(469)		653		(64)		2,817
Net income/(loss)	$	449	$	6,585	$	3,895	$	(4,835)
Basic and diluted earnings/(loss) per share:
Basic earnings/(loss) per share	$	0.04	$	0.55	$	0.32	$	(0.41)
Diluted earnings/(loss) per share	$	0.04	$	0.53	$	0.32	$	(0.41)

⁽¹⁾


	2018 Quarters (unaudited)
(in thousands, except per share data)	First		Second		Third		Fourth
Net revenues	$	46,483	$	47,268	$	50,703	$	57,122
Total operating expenses		39,946		40,005		40,589		45,677
Operating income		6,537		7,263		10,114		11,445
Provision for income taxes		(592)		(726)		(1,329)		(1,910)
Net income	$	2,250	$	2,777	$	5,037	$	5,430
Basic and diluted earnings per share:
Basic earnings per share	$	0.19	$	0.24	$	0.43	$	0.46
Diluted earnings per share	$	0.19	$	0.23	$	0.42	$	0.46

DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Revenue Recognition	$ 206,547	$ 201,576	$ 176,842
Sales of generic pharmaceutical products [Member]
Revenue Recognition	128,729	117,451	118,437
Sales of branded pharmaceutical products [Member]
Revenue Recognition	63,767	60,554	50,919
Sales of contract manufactured products [Member]
Revenue Recognition	11,139	9,119	7,046
Royalties from licensing agreements [Member]
Revenue Recognition	807	12,504	0
Product development services [Member]
Revenue Recognition	1,125	1,019	0
Other [Member]
Revenue Recognition	$ 980	$ 929	$ 440

DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Revenue (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Revenues	$ 47,966	$ 51,337	$ 54,357	$ 52,887	$ 57,122	$ 50,703	$ 47,268	$ 46,483	$ 206,547	$ 201,576	$ 176,842
Performance obligations transferred at a point in time [Member]
Revenues									205,422	200,557	176,842
Performance obligations transferred over time [Member]
Revenues									$ 1,125	$ 1,019	$ 0

DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - consolidated balance sheets for accruals and allowances (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items]
Beginning balance	$ 47,705
Ending balance	59,946	$ 47,705
Chargebacks
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items]
Beginning balance	39,007	28,230	$ 26,785
Accruals/Adjustments	260,771	229,813	179,297
Credits Taken Against Reserve	(249,896)	(219,036)	(177,852)
Ending balance	49,882	39,007	28,230
Government Rebates
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items]
Beginning balance	8,974	7,930	5,891
Accruals/Adjustments	17,549	11,383	12,237
Credits Taken Against Reserve	(17,622)	(10,339)	(10,198)
Ending balance	8,901	8,974	7,930
Returns
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items]
Beginning balance	12,552	8,274	5,756
Accruals/Adjustments	19,105	14,243	12,184
Credits Taken Against Reserve	(15,062)	(9,965)	(9,666)
Ending balance	16,595	12,552	8,274
Administrative Fees and Other Rebates
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items]
Beginning balance	7,353	5,226	3,550
Accruals/Adjustments	36,874	33,167	24,037
Credits Taken Against Reserve	(35,946)	(31,040)	(22,361)
Ending balance	8,281	7,353	5,226
Prompt Payment Discounts
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items]
Beginning balance	2,009	1,834	1,554
Accruals/Adjustments	10,789	9,371	8,126
Credits Taken Against Reserve	(10,249)	(9,196)	(7,846)
Ending balance	$ 2,549	$ 2,009	$ 1,834

DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Earnings (Loss) per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Net income/(loss), Basic	$ (4,835)	$ 3,895	$ 6,585	$ 449	$ 5,430	$ 5,037	$ 2,777	$ 2,250	$ 6,094	$ 15,494	$ (1,076)
Net income/(loss) allocated to common shares, Basic									$ 5,997	$ 15,340	$ (1,076)
Earnings/(Loss) per share, Basic	$ (0.41)	$ 0.32	$ 0.55	$ 0.04	$ 0.46	$ 0.43	$ 0.24	$ 0.19	$ 0.51	$ 1.31	$ (0.09)
Net income/(loss), Diluted	$ (4,835)	$ 3,895	$ 6,585	$ 449	$ 5,430	$ 5,037	$ 2,777	$ 2,250	$ 6,094	$ 15,494	$ (1,076)
Net income/(loss) allocated to common shares, Diluted									$ 5,997	$ 15,340	$ (1,076)
Basic Weighted-Average Shares Outstanding									11,841	11,677	11,547
Diluted Weighted-Average Shares Outstanding									12,040	11,772	11,547
(Loss)/Earnings per share, Diluted	$ (0.41)	$ 0.32	$ 0.53	$ 0.04	$ 0.46	$ 0.42	$ 0.23	$ 0.19	$ 0.50	$ 1.30	$ (0.09)
Convertible Senior Notes [Member]
Dilutive effect of Notes, Diluted									96	0	0
Equity Option [Member]
Dilutive effect of Notes, Diluted									103	95	0
Restricted Stock [Member]
Net income allocated to restricted stock, Basic									$ (97)	$ (154)	$ 0
Net income allocated to restricted stock, Diluted									$ (97)	$ (154)	$ 0

DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Geographic Location (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Revenues	$ 47,966	$ 51,337	$ 54,357	$ 52,887	$ 57,122	$ 50,703	$ 47,268	$ 46,483	$ 206,547	$ 201,576	$ 176,842
United States [Member]
Revenues									199,663	196,886	176,842
Canada [Member]
Revenues									$ 6,884	$ 4,690	$ 0

DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Property and Equipment (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Property and equipment, net	$ 40,551	$ 38,090
United States [Member]
Property and equipment, net	26,708	24,437
Canada [Member]
Property and equipment, net	$ 13,843	$ 13,653

DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional information (Details) - USD ($) shares in Millions				1 Months Ended	3 Months Ended								12 Months Ended
	Jan. 01, 2019	Aug. 06, 2018	Apr. 30, 2016	Dec. 31, 2019	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 02, 2019
Business Combination Purchase Price Before Adjustments		$ 18,000,000
Business Combination, Consideration Transferred		$ 16,700,000
Impairment of Intangible Assets, Finite-lived													$ 75,000	$ 0	$ 903,000
Research and Development Expense													19,806,000	15,388,000	9,070,000
Allocated Share-based Compensation Expense													$ 9,100,000	$ 6,700,000	$ 6,100,000
Short-term Debt, Percentage Bearing Fixed Interest Rate				3.00%	3.00%								3.00%				3.00%
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount													3.0	4.4	4.8
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Amount															$ 13,400,000
Effective Income Tax Rate Reconciliation, Foreign Income Tax Rate Differential, Percent													0.40%	26.50%	0.00%
Revenues					$ 47,966,000	$ 51,337,000	$ 54,357,000	$ 52,887,000	$ 57,122,000	$ 50,703,000	$ 47,268,000	$ 46,483,000	$ 206,547,000	$ 201,576,000	$ 176,842,000
Contract with Customer, Asset, Net				$ 100,000	100,000				100,000				100,000	100,000
Deferred Revenue, Current				451,000	451,000				711,000				451,000	711,000	0
Deferred Revenue, Revenue Recognized													10,100,000
Fdic Guaranteed Amount				250,000	250,000								250,000
Payments to Acquire Intangible Assets													20,914,000	$ 5,169,000	$ 97,624,000
Operating Lease, Right-of-Use Asset	$ 500,000
Operating Lease, Liability	$ 500,000			$ 489,000	$ 489,000								$ 489,000
Operating Lease, Liability, Statement of Financial Position [Extensible List]	us-gaap:AccruedLiabilitiesCurrent us-gaap:OtherLiabilitiesNoncurrent			us-gaap:AccruedLiabilitiesCurrent us-gaap:OtherLiabilitiesNoncurrent	us-gaap:AccruedLiabilitiesCurrent us-gaap:OtherLiabilitiesNoncurrent								us-gaap:AccruedLiabilitiesCurrent us-gaap:OtherLiabilitiesNoncurrent
Prepaid Rent	$ 10,000
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent													21.00%	21.00%	35.00%
Deferred Tax Assets, Valuation Allowance	100,000			$ 432,000	$ 432,000				2,265,000				$ 432,000	$ 2,265,000
Deferred Tax Liabilities, Net	100,000
Cumulative Effect on Retained Earnings, Net of Tax	$ 2,000
Inventory Reserve Charges				4,600,000	4,600,000
Operating Loss Carryforwards				11,300,000	11,300,000								11,300,000
ANI Canada [Member]
Deferred Tax Assets, Valuation Allowance				400,000	400,000				1,900,000				400,000	1,900,000
Operating Loss Carryforwards				7,900,000	7,900,000				$ 300,000				7,900,000	300,000
Performance Obligation From Prior Period [Member]
Revenues													10,200,000
Sales of contract manufactured products [Member]
Revenue, Remaining Performance Obligation, Amount				8,100,000	8,100,000								8,100,000
Product Development Services [Member]
Revenue, Remaining Performance Obligation, Amount				1,300,000	1,300,000								1,300,000
Drug Applications and Marketing and Distribution Rights [Member] \| New Drug Applications [Member]
Impairment of Intangible Assets, Finite-lived													75,000	0	$ 900,000	$ 6,700,000
Employee Stock Purchase Plan 2016 [Member]
Allocated Share-based Compensation Expense													$ 147,000	$ 102,000	$ 68,000
Customer One [Member]
Concentration Risk, Percentage													32.00%	21.00%	29.00%
Customer Two [Member]
Concentration Risk, Percentage													25.00%	23.00%	29.00%
Customer Three [Member]
Concentration Risk, Percentage													23.00%	33.00%	20.00%
Customer One Two And Three [Member]
Concentration Risk, Percentage													88.00%
Two Suppliers 2017 [Member]
Concentration Risk, Percentage															23.00%
One Supplier [Member]
Concentration Risk, Percentage													13.00%	13.00%
Other Sundry Liabilities, Current				$ 700,000	$ 700,000								$ 700,000
Minimum \| Product Development Services [Member]
Revenue, Remaining Performance Obligation, Remaining Period				6 months	6 months								6 months
Minimum \| Intangible Asset Impairments [Member]
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life													4 years
Maximum \| Product Development Services [Member]
Revenue, Remaining Performance Obligation, Remaining Period				15 months	15 months								15 months
Maximum \| Intangible Asset Impairments [Member]
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life													10 years
Cranford Pharmaceuticals [Member] \| New Drug Applications [Member]
Payments to Acquire Intangible Assets			$ 60,000,000
Funds Held In Escrow In Relation To Asset Purchase			$ 5,000,000
Building and Building Improvements [Member] \| Minimum
Property, Plant and Equipment, Useful Life													20 years
Building and Building Improvements [Member] \| Maximum
Property, Plant and Equipment, Useful Life													40 years
Machinery, furniture and equipment [Member] \| Minimum
Property, Plant and Equipment, Useful Life													1 year
Machinery, furniture and equipment [Member] \| Maximum
Property, Plant and Equipment, Useful Life													10 years

BUSINESS COMBINATION - Allocation of Purchase Price (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Goodwill	$ 3,580	$ 3,580	$ 1,838
WellSpring Pharma Services Inc [Member]
Total Purchase Consideration	16,687
Cash and cash equivalents	220
Accounts receivable	1,311
Inventories	2,197
Prepaid expenses and other current assets	361
Property and equipment	13,935
Goodwill	1,742
Total assets acquired	19,766
Accounts payable and other current liabilities	2,413
Deferred revenue	666
Total liabilities assumed	3,079
Net assets acquired	$ 16,687

BUSINESS COMBINATION - Pro Forma (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
BUSINESS COMBINATION
Net revenues	$ 208,213	$ 188,758
Net income/(loss)	$ 13,287	$ (3,102)

BUSINESS COMBINATION - Additional Information (Details) - USD ($) $ in Millions		12 Months Ended
	Aug. 06, 2018	Dec. 31, 2019	Dec. 31, 2018
Business Combination, Consideration Transferred	$ 16.7
Business Combination Purchase Price Before Adjustments	18.0
WellSpring Pharma Services Inc [Member]
Business Combination, Consideration Transferred	16.7
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual		$ 6.9
Business Combination, Pro Forma Information, Earnings or Loss of Acquiree since Acquisition Date, Actual		$ (5.2)
Business Combination, Acquisition Related Costs			$ 1.1
Business Combination Purchase Price Before Adjustments	$ 18.0
Business Combination Related Party Debt Forgiveness			$ 4.4

INDEBTEDNESS - Credit facility (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Current component of term loan, net of deferred financing costs	$ 9,941	$ 3,256
Term loan, net of deferred financing costs and current component	175,808	67,296
Long Term Debt Current [Member]
Borrowing on secured term loan	10,412	3,609
Deferred financing costs	(471)	(353)
Current component of term loan, net of deferred financing costs	9,941	3,256
Long Term Debt Noncurrent [Member]
Borrowing on secured term loan	177,069	68,578
Deferred financing costs	(1,261)	(1,282)
Term loan, net of deferred financing costs and current component	$ 175,808	$ 67,296

INDEBTEDNESS - Credit facility - Contractual maturity (Details) $ in Thousands	Dec. 31, 2019 USD ($)
Delayed Draw Term Loan [Member]
2020	$ 5,900
2021	5,900
2022	8,850
2023	97,350
Total	118,000
Term Loan [Member]
2020	4,512
2021	5,414
2022	5,414
2023	54,141
Total	$ 69,481

INDEBTEDNESS - Convertible senior notes (Details) - Convertible Senior Notes [Member] - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2014
Principal amount	$ 0	$ 118,750	$ 143,800
Unamortized debt discount	0	(5,648)	$ (33,600)
Deferred financing costs	0	(639)
Net carrying value	$ 0	$ 112,463

INDEBTEDNESS - Convertible Senior Notes, Term Loan, and Delayed Draw Term Loan (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
INDEBTEDNESS
Contractual coupon	$ 6,635	$ 7,170	$ 4,313
Amortization of debt discount	5,647	7,002	6,720
Amortization of finance fees	1,377	1,463	845
Capitalized interest	(191)	(724)	(554)
Interest Expense, Debt	$ 13,468	$ 14,911	$ 11,324

INDEBTEDNESS - Additional information (Details)			1 Months Ended		12 Months Ended
INDEBTEDNESS - Additional information (Details)	Dec. 02, 2019 USD ($) shares	Nov. 29, 2019 USD ($)	Dec. 31, 2018 USD ($)	Dec. 27, 2018 USD ($)	Dec. 31, 2019 USD ($) shares	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)	Dec. 31, 2014 USD ($) D $ / shares
Short-term Debt, Percentage Bearing Fixed Interest Rate	3.00%				3.00%
Debt Instrument, Interest Rate, Effective Percentage			8.50%		7.40%	8.50%
Amortization of Debt Issuance Costs					$ 1,377,000	$ 1,463,000	$ 845,000
Debt Instrument, Maturity Date				Dec. 01, 2019
Gain (Loss) on Repurchase of Debt Instrument					0	(468,000)	0
Adjustments To Additional Paid In Capital Repurchase Of Convertible Notes And Unwinding Of Call Option Overlay Net					1,700,000
Long-term Debt, Current Maturities			$ 3,256,000		$ 9,941,000	3,256,000
Warrant [Member]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights \| shares					1,709,002
Bond Hedge [Member]
Underlying Shares Of Common Stock Bond Hedge \| shares	1,709,002
Delayed Draw Term Loan [Member]
Line of Credit Facility, Maximum Borrowing Capacity				$ 118,000,000
Delayed Draw Term Loan [Member] \| Maximum
Debt Instrument, Basis Spread on Variable Rate				2.75%
Delayed Draw Term Loan [Member] \| Minimum
Debt Instrument, Basis Spread on Variable Rate				1.50%
Senior Secured Credit Facility [Member]
Debt Instrument, Description of Variable Rate Basis				LIBOR rate plus 1.50% to 2.75% per annum, depending on our total leverage ratio or an alternative base rate plus an applicable base rate margin, which varies within a range of 0.50% to 1.75%,
Debt Instrument, Covenant Description				which is, as of December 31, 2019 no greater than 3.50 to 1.00 and a minimum fixed charge coverage ratio, which shall be greater than or equal to 1.25 to 1.00.
Line of Credit Facility, Maximum Borrowing Capacity				$ 265,200,000
Senior Secured Credit Facility [Member] \| Delayed Draw Term Loan [Member]
Long-term Debt, Gross					$ 118,000,000
Debt Issuance Costs, Net					500,000
Debt Issuance Costs, Noncurrent, Net					400,000
Debt Issuance Costs, Current, Net					100,000
Proceeds from exercise of option to borrow		$ 118,000,000
Long-term Debt, Current Maturities					5,900,000
Credit Agreement [Member]
Line of Credit Facility, Maximum Borrowing Capacity							125,000,000
Prepaid Expenses and Other Current Assets [Member] \| Revolving Credit Facility [Member]
Debt Issuance Costs, Current, Net					200,000
Other Long-Term Assets [Member] \| Revolving Credit Facility [Member]
Debt Issuance Costs, Noncurrent, Net					800,000
Line of Credit Facility, Maximum Borrowing Capacity			75,000,000			75,000,000	$ 50,000,000
Convertible Senior Notes [Member]
Long-term Debt, Gross			118,750,000		0	118,750,000		$ 143,800,000
Proceeds from Issuance of Debt								$ 122,600,000
Short-term Debt, Percentage Bearing Fixed Interest Rate								3.00%
Underlying Shares Of Common Stock Convertible Debt \| shares	1,709,002
Per Note Principal \| $ / shares								$ 1,000
Debt Instrument, Convertible, Threshold Percentage of Stock Price and Conversion Price Trigger								98.00%
Debt Instrument, Unamortized Discount			5,648,000		0	5,648,000		$ 33,600,000
Deferred Offering Costs								$ 5,500,000
Exercise Price Of Bond Hedge \| $ / shares								$ 69.48
Class of Warrant or Right, Exercise Price of Warrants or Rights \| $ / shares								$ 96.21
Net Adjustments To Additional Paid In Capital Bond Hedge Acquired Warrant Issued Net								$ 15,600,000
Amortization of Debt Issuance Costs								4,200,000
Payments of Stock Issuance Costs								$ 1,300,000
Debt Issuance Costs, Net			639,000		$ 0	639,000
Debt Instrument, Repurchase Amount			25,000,000			25,000,000
Trading days \| D								20
Debt Instrument, Percent, Conversion Price								130.00%
Consecutive trading days \| D								30
Cash Received From Unwinding Call Option Overlay			400,000
Number of note holders elected for conversion	50,000
Number of shares issued upon conversion \| shares	33
Line of Credit [Member] \| Maximum
Line of Credit Facility, Commitment Fee Percentage					0.50%
Line of Credit [Member] \| Minimum
Line of Credit Facility, Commitment Fee Percentage					0.25%
Term Loan [Member] \| Senior Secured Credit Facility [Member]
Long-term Debt, Gross			$ 72,200,000		$ 69,500,000	$ 72,200,000
Debt Issuance Costs, Net					1,300,000
Debt Instrument, Face Amount				$ 72,200,000
Debt Issuance Costs, Noncurrent, Net					900,000
Debt Issuance Costs, Current, Net					$ 400,000
Debt Instrument, Maturity Date				Dec. 27, 2023	Dec. 27, 2023
Long-term Debt, Current Maturities					$ 4,500,000
Term Loan [Member] \| Senior Secured Credit Facility [Member] \| Maximum
Debt Instrument, Basis Spread on Variable Rate					1.75%
Term Loan [Member] \| Senior Secured Credit Facility [Member] \| Minimum
Debt Instrument, Basis Spread on Variable Rate					0.50%
Term Loan [Member] \| Revolving Credit Facility [Member]
Debt Issuance Costs, Net					$ 1,000,000

DERIVATIVE FINANCIAL INSTRUMENT AND HEDGING ACTIVITY (Details) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended
	Dec. 27, 2018	Dec. 31, 2019	Feb. 28, 2019	Dec. 31, 2018
Accumulated other comprehensive loss, net of tax		$ 4,871		$ 379
Term Loan [Member] \| Senior Secured Credit Facility [Member]
Debt Instrument, Face Amount	$ 72,200
Derivative Asset, Notional Amount		69,500		$ 72,200
Interest rate swap [Member] \| Delayed Draw Term Loan [Member]
Derivative Asset, Notional Amount		118,000	$ 118,000
Derivative, Swaption Interest Rate			2.47%
Interest Expense		100
Derivative Asset, Fair Value, Gross Asset		3,800
Accumulated other comprehensive loss, net of tax		3,000
Unrealized Gain Loss On Interest Rate Cash Flow Hedges Net Of Tax Accumulated Other Comprehensive Income Loss		3,000
Interest rate swap [Member] \| Term Loan [Member]
Derivative, Maturity Date	Dec. 27, 2023
Derivative Asset, Notional Amount	$ 72,200	$ 69,500
Derivative, Swaption Interest Rate		2.60%
Interest Expense		$ 200
Derivative Asset, Fair Value, Gross Asset		2,400
Accumulated other comprehensive loss, net of tax		1,900
Unrealized Gain Loss On Interest Rate Cash Flow Hedges Net Of Tax Accumulated Other Comprehensive Income Loss		$ 1,500

INVENTORIES (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended
INVENTORIES (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2019	Dec. 31, 2018
INVENTORIES
Raw materials	$ 34,881	$ 34,881	$ 27,671
Packaging materials	2,902	2,902	2,563
Work-in-progress	361	361	1,210
Finished goods	16,750	16,750	10,620
Inventory, Gross, Total	54,894	54,894	42,064
Reserve for excess/obsolete inventories	(6,731)	(6,731)	(1,561)
Inventories, net	48,163	48,163	$ 40,503
Inventory reserve charges	$ 4,600	$ 4,600

PROPERTY, PLANT, AND EQUIPMENT (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Property, Plant and Equipment, Gross, Total	$ 53,321	$ 46,491
Less: accumulated depreciation	(12,770)	(8,401)
Property and equipment, net	40,551	38,090
Land [Member]
Property, Plant and Equipment, Gross, Total	4,566	4,558
Buildings [Member]
Property, Plant and Equipment, Gross, Total	10,275	10,079
Machinery, furniture and equipment [Member]
Property, Plant and Equipment, Gross, Total	34,984	26,814
Construction in progress [Member]
Property, Plant and Equipment, Gross, Total	$ 3,496	$ 5,040

PROPERTY, PLANT, AND EQUIPMENT - Additional information (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
PROPERTY, PLANT, AND EQUIPMENT
Depreciation	$ 4.4	$ 2.1	$ 1.2
Interest Costs Capitalized	$ 0.2	$ 0.7

INTANGIBLE ASSETS - Goodwill (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
INTANGIBLE ASSETS
Goodwill, Beginning Balance	$ 3,580	$ 1,838
Acquisition of WellSpring (Note 2)	0	1,742
Goodwill, Ending Balance	$ 3,580	$ 3,580

INTANGIBLE ASSETS - Definite-lived Intangible Assets (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
INTANGIBLE ASSETS
Gross Carrying Amount	$ 307,225	$ 288,215
Accumulated Amortization	$ (126,837)	(86,611)
Weighted Average Amortization Period	10 years
Acquired ANDA intangible assets [Member]
INTANGIBLE ASSETS
Gross Carrying Amount	$ 64,704	46,194
Accumulated Amortization	$ (30,169)	(17,093)
Weighted Average Amortization Period	10 years
NDAs and product rights
INTANGIBLE ASSETS
Gross Carrying Amount	$ 230,974	230,974
Accumulated Amortization	$ (87,352)	(62,222)
Weighted Average Amortization Period	10 years
Marketing and distribution rights
INTANGIBLE ASSETS
Gross Carrying Amount	$ 10,923	10,423
Accumulated Amortization	$ (8,982)	(7,051)
Weighted Average Amortization Period	4 years 8 months 12 days
Non-compete agreement
INTANGIBLE ASSETS
Gross Carrying Amount	$ 624	624
Accumulated Amortization	$ (334)	$ (245)
Weighted Average Amortization Period	7 years

INTANGIBLE ASSETS - Expected future amortization (Details) $ in Thousands	Dec. 31, 2019 USD ($)
INTANGIBLE ASSETS
2020	$ 33,180
2021	31,734
2022	28,329
2023	27,581
2024	24,604
2025 and thereafter	34,960
Total	$ 180,388

INTANGIBLE ASSETS - Additional information (Details) - USD ($)		1 Months Ended								3 Months Ended		12 Months Ended
	Apr. 30, 2016	Jul. 31, 2019	Mar. 31, 2019	Jan. 31, 2019	May 31, 2018	Apr. 30, 2018	Dec. 31, 2017	Feb. 28, 2017	May 31, 2015	Dec. 31, 2019	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
INTANGIBLE ASSETS
Amortization of Intangible Assets												$ 40,200,000	$ 31,700,000	$ 26,700,000
Payments to Acquire Intangible Assets												$ 20,914,000	5,169,000	97,624,000
Finite-Lived Intangible Asset, Useful Life												10 years
Goodwill, Impairment Loss												$ 0	0
Finite-Lived Intangible Assets, Gross										$ 307,225,000		307,225,000	288,215,000
Impairment of Intangible Assets, Finite-lived												$ 75,000	0	903,000
Acquired Finite-lived Intangible Asset, Amortization Description												we are amortizing 80% of the value of the intangible assets over the first five years of useful lives of the assets and amortizing the remaining 20% of the value of the intangible assets over the second five years of useful lives of the assets.
Pharmaceutics International, Inc and BAS ANDA LLC [Member]
INTANGIBLE ASSETS
Payments to Acquire Intangible Assets										500,000
Finite-Lived Intangible Asset, Useful Life												10 years
Appco Pharma, LLC [Member]
INTANGIBLE ASSETS
Payments to Acquire Intangible Assets		$ 80,000
Finite-Lived Intangible Asset, Useful Life											8 years
Finite-Lived Intangible Assets, Gross		80,000
Impairment of Intangible Assets, Finite-lived										75,000		$ 75,000
Inderal XL [Member]
INTANGIBLE ASSETS
Payments to Acquire Intangible Assets								$ 20,200,000
Finite-Lived Intangible Asset, Useful Life								10 years
Finite-Lived Intangible Assets, Gross								$ 15,100,000
Acquisition Costs Capitalized								40,000
InnoPran XL [Member]
INTANGIBLE ASSETS
Payments to Acquire Intangible Assets								$ 30,600,000
Finite-Lived Intangible Asset, Useful Life								10 years
Finite-Lived Intangible Assets, Gross								$ 19,000,000
Acquisition Costs Capitalized								$ 100,000
Teva Pharmaceuticals [Member]
INTANGIBLE ASSETS
Payments to Acquire Intangible Assets				$ 16,000,000
Cumulative Amortization Expense				$ 6,800,000
Acquired ANDA intangible assets [Member]
INTANGIBLE ASSETS
Finite-Lived Intangible Asset, Useful Life												10 years
Finite-Lived Intangible Assets, Gross										64,704,000		$ 64,704,000	46,194,000
Acquired ANDA intangible assets [Member] \| IDT Australia Limited [Member]
INTANGIBLE ASSETS
Payments to Acquire Intangible Assets						$ 2,700,000
Finite-Lived Intangible Asset, Useful Life						10 years
Finite-Lived Intangible Assets, Gross						$ 2,500,000
Acquisition Costs Capitalized						$ 18,000
Acquired ANDA intangible assets [Member] \| Teva Pharmaceuticals [Member]
INTANGIBLE ASSETS
Finite-Lived Intangible Asset, Useful Life			10 years
Finite-Lived Intangible Assets, Gross			$ 2,500,000
Acquisition Costs Capitalized			$ 10,000
Marketing and distribution rights
INTANGIBLE ASSETS
Finite-Lived Intangible Asset, Useful Life												4 years 8 months 12 days
Finite-Lived Intangible Assets, Gross										10,923,000		$ 10,923,000	10,423,000
Marketing and distribution rights \| Pharmaceutics International, Inc and BAS ANDA LLC [Member]
INTANGIBLE ASSETS
Payments to Acquire Intangible Assets										500,000
Finite-Lived Intangible Asset, Useful Life												10 years
Marketing and distribution rights \| Appco Pharma, LLC [Member]
INTANGIBLE ASSETS
Payments to Acquire Intangible Assets		80,000
Finite-Lived Intangible Assets, Gross		$ 80,000
Impairment of Intangible Assets, Finite-lived										75,000
New Drug Applications [Member] \| Drug Applications and Marketing and Distribution Rights [Member]
INTANGIBLE ASSETS
Maximum Royalties Potentially Payable									$ 5,000,000
Royalty Rate									5.00%
Finite-Lived Intangible Assets, Gross										$ 10,900,000		$ 10,900,000
Impairment of Intangible Assets, Finite-lived												$ 75,000	$ 0	900,000	$ 6,700,000
Assets Held-for-sale, Not Part of Disposal Group, Current															$ 900,000
Abbreviated New Drug Applications [Member] \| Impax Laboratories, Inc. [Member]
INTANGIBLE ASSETS
Payments to Acquire Intangible Assets					$ 2,300,000
Finite-Lived Intangible Asset, Useful Life					10 years
Finite-Lived Intangible Assets, Gross					$ 1,000,000
Acquisition Costs Capitalized					$ 100,000
New Drug Applications [Member] \| Cranford Pharmaceuticals [Member]
INTANGIBLE ASSETS
Payments to Acquire Intangible Assets	$ 60,000,000
AstraZeneca AB and AstraZeneca UK Limited [Member] \| New Drug Applications [Member]
INTANGIBLE ASSETS
Payments to Acquire Intangible Assets							$ 46,500,000
Finite-Lived Intangible Asset, Useful Life							10 years
Finite-Lived Intangible Assets, Gross							$ 46,700,000							$ 46,700,000
Acquisition Costs Capitalized							$ 200,000

FAIR VALUE DISCLOSURES (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Contingent Value Rights [Member]
Financial Liabilities Fair Value Disclosure	$ 0	$ 0
Interest rate swap [Member]
Financial Liabilities Fair Value Disclosure	6,215	496
Fair Value, Inputs, Level 1 [Member] \| Contingent Value Rights [Member]
Financial Liabilities Fair Value Disclosure	0	0
Fair Value, Inputs, Level 1 [Member] \| Interest rate swap [Member]
Financial Liabilities Fair Value Disclosure	0	0
Fair Value, Inputs, Level 2 [Member] \| Contingent Value Rights [Member]
Financial Liabilities Fair Value Disclosure	0	0
Fair Value, Inputs, Level 2 [Member] \| Interest rate swap [Member]
Financial Liabilities Fair Value Disclosure	6,215	496
Fair Value, Inputs, Level 3 [Member] \| Contingent Value Rights [Member]
Financial Liabilities Fair Value Disclosure	0	0
Fair Value, Inputs, Level 3 [Member] \| Interest rate swap [Member]
Financial Liabilities Fair Value Disclosure	$ 0	$ 0

FAIR VALUE DISCLOSURES - Additional information (Details)	1 Months Ended								3 Months Ended		12 Months Ended
	Jul. 31, 2019 USD ($)	Jun. 30, 2019 USD ($) item	Mar. 31, 2019 USD ($) item	Jan. 31, 2019 USD ($)	May 31, 2018 USD ($)	Apr. 30, 2018 USD ($) item	Dec. 31, 2017 USD ($)	Feb. 28, 2017 USD ($)	Dec. 31, 2019 USD ($)	Mar. 31, 2018	Dec. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)	Dec. 31, 2016 USD ($)	Feb. 28, 2019 USD ($)	Dec. 27, 2018 USD ($)
Payments to Acquire Intangible Assets											$ 20,914,000	$ 5,169,000	$ 97,624,000
Goodwill, Impairment Loss											0	0
Finite-Lived Intangible Assets, Gross									$ 307,225,000		$ 307,225,000	288,215,000
Finite-Lived Intangible Asset, Useful Life											10 years
Inventory, Raw Materials, Gross									34,881,000		$ 34,881,000	27,671,000
Intangible asset impairment charge											$ 75,000	0	903,000
Fair Values Inputs Discount Rate											15.00%
Research and Development in Process											$ 2,324,000	1,335,000	0
Inventory, Finished Goods, Gross									16,750,000		16,750,000	10,620,000
Appco Pharma, LLC [Member]
Payments to Acquire Intangible Assets	$ 80,000
Finite-Lived Intangible Assets, Gross	80,000
Finite-Lived Intangible Asset, Useful Life										8 years
Intangible asset impairment charge									75,000		$ 75,000
Pharmaceutics International, Inc and BAS ANDA LLC [Member]
Payments to Acquire Intangible Assets									500,000
Finite-Lived Intangible Asset, Useful Life											10 years
Senior Secured Credit Facility [Member] \| Delayed Draw Term Loan [Member]
Long-term Debt, Gross									118,000,000		$ 118,000,000
Interest rate swap [Member] \| Delayed Draw Term Loan [Member]
Derivative Asset, Notional Amount									118,000,000		118,000,000				$ 118,000,000
Interest Rate Derivative Liabilities, at Fair Value									3,800,000		3,800,000
Inderal XL [Member]
Payments to Acquire Intangible Assets								$ 20,200,000
Finite-Lived Intangible Assets, Gross								$ 15,100,000
Finite-Lived Intangible Asset, Useful Life								10 years
Acquisition Costs Capitalized								$ 40,000
Fair Values Inputs Discount Rate								10.00%
Inventory, Finished Goods, Gross								$ 5,000,000
InnoPran XL [Member]
Payments to Acquire Intangible Assets								30,600,000
Finite-Lived Intangible Assets, Gross								$ 19,000,000
Finite-Lived Intangible Asset, Useful Life								10 years
Acquisition Costs Capitalized								$ 100,000
Fair Values Inputs Discount Rate								10.00%
Inventory, Finished Goods, Gross								$ 11,600,000
IDT Australia Limited [Member] \| Abbreviated New Drug Applications [Member]
Number Of Generic Drug Products Acquired \| item						23
IDT Australia Limited [Member] \| Abbreviated New Drug Applications [Member] \| Maximum \| Measurement Input, Discount Rate [Member]
Fair Values Inputs Discount Rate						15.00%
IDT Australia Limited [Member] \| Abbreviated New Drug Applications [Member] \| Minimum \| Measurement Input, Discount Rate [Member]
Fair Values Inputs Discount Rate						10.00%
IDT Australia Limited [Member] \| Acquired New Drug Applications [Member]
Payments to Acquire Intangible Assets						$ 2,700,000
Finite-Lived Intangible Assets, Gross						$ 2,500,000
Finite-Lived Intangible Asset, Useful Life						10 years
Acquisition Costs Capitalized						$ 18,000
Inventory, Raw Materials, Gross						200,000
Impax Laboratories, Inc. [Member] \| Equipment [Member]
Finite-Lived Intangible Assets, Gross					$ 58,000
Finite-Lived Intangible Asset, Useful Life					5 years
Impax Laboratories, Inc. [Member] \| Abbreviated New Drug Applications [Member]
Payments to Acquire Intangible Assets					$ 2,300,000
Finite-Lived Intangible Assets, Gross					$ 1,000,000
Finite-Lived Intangible Asset, Useful Life					10 years
Acquisition Costs Capitalized					$ 100,000
Contingent Consideration In An Asset Purchase					$ 10,000,000
Impax Laboratories, Inc. [Member] \| Abbreviated New Drug Applications [Member] \| Maximum \| Measurement Input, Discount Rate [Member]
Fair Values Inputs Discount Rate					15.00%
Impax Laboratories, Inc. [Member] \| Abbreviated New Drug Applications [Member] \| Minimum \| Measurement Input, Discount Rate [Member]
Fair Values Inputs Discount Rate					10.00%
Term Loan [Member] \| Senior Secured Credit Facility [Member]
Derivative Asset, Notional Amount									69,500,000		69,500,000	72,200,000
Long-term Debt, Gross									69,500,000		69,500,000	72,200,000
Term Loan [Member] \| Interest rate swap [Member]
Derivative Asset, Notional Amount									69,500,000		69,500,000					$ 72,200,000
Interest Rate Derivative Liabilities, at Fair Value									2,400,000		2,400,000
Acquired ANDA intangible assets [Member]
Finite-Lived Intangible Assets, Gross									64,704,000		$ 64,704,000	46,194,000
Finite-Lived Intangible Asset, Useful Life											10 years
Acquired ANDA intangible assets [Member] \| IDT Australia Limited [Member]
Payments to Acquire Intangible Assets						2,700,000
Finite-Lived Intangible Assets, Gross						$ 2,500,000
Finite-Lived Intangible Asset, Useful Life						10 years
Acquisition Costs Capitalized						$ 18,000
In Process Research and Development [Member] \| Impax Laboratories, Inc. [Member]
Research and Development in Process					$ 1,300,000
In Process Research and Development [Member] \| Impax Laboratories, Inc. [Member] \| Measurement Input, Discount Rate [Member]
Fair Values Inputs Discount Rate					75.00%
Drug Applications and Marketing and Distribution Rights [Member] \| New Drug Applications [Member]
Finite-Lived Intangible Assets, Gross									10,900,000		$ 10,900,000
Intangible asset impairment charge											75,000	0	900,000	$ 6,700,000
Marketing and distribution rights
Finite-Lived Intangible Assets, Gross									10,923,000		$ 10,923,000	$ 10,423,000
Finite-Lived Intangible Asset, Useful Life											4 years 8 months 12 days
Marketing and distribution rights \| Appco Pharma, LLC [Member]
Payments to Acquire Intangible Assets	80,000
Finite-Lived Intangible Assets, Gross	$ 80,000
Intangible asset impairment charge									75,000
Marketing and distribution rights \| Pharmaceutics International, Inc and BAS ANDA LLC [Member]
Payments to Acquire Intangible Assets									$ 500,000
Finite-Lived Intangible Asset, Useful Life											10 years
Teva Pharmaceuticals [Member]
Payments to Acquire Intangible Assets				$ 16,000,000
Fair Values Inputs Discount Rate				12.00%
Cumulative Amortization Expense				$ 6,800,000
Additional Net Carrying Value Added To Finite Lived Intangible Assets Acquired				$ 9,200,000
Teva Pharmaceuticals [Member] \| Impax Laboratories, Inc. [Member] \| Milestone One [Member]
Contingent Liability Not Recognized					$ 25,000,000
Teva Pharmaceuticals [Member] \| Impax Laboratories, Inc. [Member] \| Milestone Two [Member]
Contingent Liability Not Recognized					$ 15,000,000
Teva Pharmaceuticals [Member] \| Acquired ANDA intangible assets [Member]
Number Of Generic Drug Products Acquired \| item			35
Finite-Lived Intangible Assets, Gross			$ 2,500,000
Finite-Lived Intangible Asset, Useful Life			10 years
Acquisition Costs Capitalized			$ 10,000
Fair Values Inputs Discount Rate			15.00%
AstraZeneca AB and AstraZeneca UK Limited [Member] \| New Drug Applications [Member]
Payments to Acquire Intangible Assets							$ 46,500,000
Finite-Lived Intangible Assets, Gross							$ 46,700,000						46,700,000
Finite-Lived Intangible Asset, Useful Life							10 years
Acquisition Costs Capitalized							$ 200,000
Contingent Consideration In An Asset Purchase							$ 3,000,000						$ 3,000,000
Fair Values Inputs Discount Rate							10.00%
Coeptis Pharmaceuticals, Inc. [Member]
Number Of Generic Drug Products Acquired \| item		7
Contingent Consideration In An Asset Purchase		$ 12,000,000
Research and Development in Process		2,300,000
Acquisition Costs Expensed		$ 24,000

STOCKHOLDERS' EQUITY (Details) shares in Thousands	Dec. 31, 2019 $ / shares shares
Class of Warrant, Issued On December 4, 2014 - Expires March 1, 2020 [Member]
Number of Underlying Shares of Common Stock \| shares	1,486
Per Share Exercise Price \| $ / shares	$ 96.21
Class of Warrant, Issued On December 5, 2014 - Expires March 1, 2020 [Member]
Number of Underlying Shares of Common Stock \| shares	223
Per Share Exercise Price \| $ / shares	$ 96.21

STOCKHOLDER'S EQUITY - Additional information (Details) - $ / shares	Dec. 31, 2019	Dec. 31, 2018
Preferred Stock, Shares Authorized	1,666,667	1,666,667
Preferred Stock, Par or Stated Value Per Share	$ 0.0001	$ 0.0001
Preferred Stock, Shares Outstanding	0	0
Class C Special Stock [Member]
Common Stock, Shares Authorized	781,281	781,281
Common Stock, Par or Stated Value Per Share	$ 0.0001	$ 0.0001
Common Stock Conversion Price	$ 90.00	$ 90.00
Common Stock, Shares, Issued	10,864	10,864
Common Stock, Shares, Outstanding	10,864	10,864
Common Stock [Member]
Common Stock, Shares Authorized	33,300,000
Common Stock, Par or Stated Value Per Share	$ 0.0001
Common Stock, Shares, Issued	12,100,000	11,900,000
Common Stock, Shares, Outstanding	12,100,000	11,900,000
Warrant [Member]
Class of Warrant or Right, Outstanding	1,700,000
Warrants expiration period	60 days

STOCK-BASED COMPENSATION - Stock-based compensation expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Allocated Share-based Compensation Expense	$ 9,100	$ 6,700	$ 6,100
Employee Stock Purchase Plan 2016 [Member]
Allocated Share-based Compensation Expense	147	102	68
Stock Incentive Plan 2008 [Member]
Allocated Share-based Compensation Expense	9,070	6,680	6,022
Cost of sales [Member] \| Employee Stock Purchase Plan 2016 [Member]
Allocated Share-based Compensation Expense	18	11	6
Cost of sales [Member] \| Stock Incentive Plan 2008 [Member]
Allocated Share-based Compensation Expense	101	87	86
Research and development Expense [Member] \| Employee Stock Purchase Plan 2016 [Member]
Allocated Share-based Compensation Expense	29	16	1
Research and development Expense [Member] \| Stock Incentive Plan 2008 [Member]
Allocated Share-based Compensation Expense	756	771	677
Selling, general and administrative Expenses [Member] \| Employee Stock Purchase Plan 2016 [Member]
Allocated Share-based Compensation Expense	100	75	61
Selling, general and administrative Expenses [Member] \| Stock Incentive Plan 2008 [Member]
Allocated Share-based Compensation Expense	$ 8,213	$ 5,822	$ 5,259

STOCK-BASED COMPENSATION - Fair value of options (Details)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Dividend yield	0.00%	0.00%	0.00%
Minimum
Expected option life (years)	5 years 6 months	5 years 5 months 23 days	5 years 3 months 29 days
Risk-free interest rate	1.91%	2.64%	1.93%
Expected stock price volatility	63.10%	55.10%	50.30%
Maximum
Expected option life (years)	6 years 3 months	6 years 3 months	7 years
Risk-free interest rate	2.58%	2.93%	2.33%
Expected stock price volatility	66.70%	60.60%	57.40%

STOCK-BASED COMPENSATION - Stock option and restricted stock option activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Option Shares
Treasury Stock, Common, Value	$ 723	$ 659
Options [Member]
Option Shares
Outstanding at the beginning of the period (in shares)	759	767	578
Granted (in shares)	160	156	207
Options Exercised/RSAs Vested (in shares)	(130)	(142)	(13)
Forfeited (in shares)	(31)	(18)	(5)
Expired (in shares)	(1)	(4)	0
Outstanding at the end of the period (in shares)	757	759	767	578
Exercisable at the end of the period (in shares)	366
Weighted Average Exercise Price
Outstanding at the beginning of the period (in dollars per share)	$ 49.74	$ 42.93	$ 39.28
Granted (in dollars per share)	65.97	57.60	51.66
Exercised (in dollars per share)	41.99	19.47	15.92
Forfeited (in dollars per share)	56.66	60.17	53.29
Expired (in dollars per share)	54.36	74.53	0.00
Outstanding at the end of the period (in dollars per share)	54.21	49.74	42.93	$ 39.28
Exercisable at the end of the period (in dollars per share)	50.47
Weighted Average Grant-date Fair Value
Granted (in dollars per share)	$ 40.14	$ 31.76	$ 27.04
Weighted Average Remaining Term (years)
Outstanding at the end of the period weighted average remaining term	7 years 2 months 12 days	7 years 7 months 6 days	7 years 9 months 18 days	8 years 2 months 12 days
Exercisable at the end of the period weighted average remaining term	6 years 2 months 12 days
Aggregate Intrinsic Value
Outstanding at the beginning of the period intrinsic value (in dollars)	$ 2,221	$ 16,785	$ 12,928
Exercised at the end of the period intrinsic value (in dollars)	3,335	5,863	542
Outstanding at the end of the period intrinsic value (in dollars)	6,761	$ 2,221	$ 16,785	$ 12,928
Exercisable at the end of the period intrinsic value (in dollars)	$ 4,469

STOCK-BASED COMPENSATION - Summary of RSA activity (Details) - $ / shares shares in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
STOCK-BASED COMPENSATION
Unvested, Shares, Outstanding, Beginning of period	117	85	63
Unvested Shares, Granted	122	65	50
Unvested Shares, Vested	(42)	(33)	(28)
Unvested Shares, Forfeited	(5)	0	0
Unvested Shares, Outstanding, End of period	192	117	85	63
Weighted Average Grant Date Fair Value, Outstanding, Beginning of period	$ 54.04	$ 48.34	$ 45.72
Weighted Average Grant Date Fair Value, Granted	66.39	58.11	49.51
Weighted Average Grant Date Fair Value, Vested	54.77	47.34	44.49
Weighted Average Grant Date Fair Value, Forfeited	62.63	0.00	0.00
Weighted Average Grant Date Fair Value, Outstanding, End of period	$ 61.46	$ 54.04	$ 48.34	$ 45.72
Weighted Average Remaining Term (years)	2 years 7 months 6 days	2 years 1 month 6 days	2 years 7 months 6 days	2 years 2 months 12 days

STOCK-BASED COMPENSATION - Additional information (Details) - USD ($) $ in Thousands, shares in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Employee Service Share-based Compensation, Tax Benefit from Compensation Expense	$ 1,400	$ 1,200	$ 600
Allocated Share-based Compensation Expense	9,100	6,700	6,100
Proceeds from Stock Options Exercised	$ 5,738	2,978	353
Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant	0.4
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period	10 years
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition	2 years 6 months
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Share-based Awards Other than Options	$ 8,900
Employee Service Share-based Compensation, Tax Benefit from Exercise of Stock Options	700	600	200
Proceeds from Stock Options Exercised	$ 5,500	2,800	200
Non Employee Director Stock Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period	10 years
Employee Stock Purchase Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized	0.2
Share-based Compensation Arrangement by Share-based Payment Award, Discount from Market Price, Purchase Date	15.00%
Employee Stock Purchase Plan 2016 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Allocated Share-based Compensation Expense	$ 147	102	68
Stock Incentive Plan 2008 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Allocated Share-based Compensation Expense	$ 9,070	$ 6,680	$ 6,022
Stock Incentive Plan 2008 [Member] \| Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period	4 years
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition	2 years 7 months 6 days
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Share-based Awards Other than Options	$ 8,600

INCOME TAXES - Provision for income taxes (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Current income tax provision:
Federal									$ 4,985	$ 7,985	$ 13,175
State									1,212	1,751	690
Total									6,197	9,736	13,865
Deferred income tax (benefit)/provision:
Federal									(6,274)	(4,630)	4,065
State									(2,027)	(556)	(556)
Foreign									1,000	(214)	0
Total									(7,301)	(5,400)	3,509
Change in valuation allowance									(1,833)	221	51
Total (benefit)/provision for income taxes	$ (2,817)	$ 64	$ (653)	$ 469	$ 1,910	$ 1,329	$ 726	$ 592	$ (2,937)	$ 4,557	$ 17,425

INCOME TAXES - Effective income tax rate reconciliation (Details)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
US Federal statutory rate	21.00%	21.00%	35.00%
State taxes, net of Federal benefit	3.20%	2.40%	2.00%
Foreign taxes	0.40%	26.50%	0.00%
Impact of Tax Cuts and Jobs Act	0.00%	0.00%	81.90%
Domestic production activities deduction	(0.00%)	(0.00%)	(8.80%)
Change in valuation allowance	(58.10%)	(26.50%)	0.00%
Stock-based compensation	(6.70%)	(1.80%)	0.80%
Non-deductible costs	9.10%	0.00%	0.50%
Change in state apportionment factors, state and foreign rates	(28.10%)	0.00%	0.00%
Research and experimentation and charitable credits	(33.50%)	(0.00%)	(2.50%)
Transfer pricing and other	(0.20%)	1.10%	(2.30%)
Total income tax (benefit)/provision	(93.00%)	22.70%	106.60%
Scenario, Plan [Member]
US Federal statutory rate	21.00%

INCOME TAXES - Deferred income tax assets and liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Jan. 01, 2019	Dec. 31, 2018
Deferred tax assets:
Accruals and advances	$ 8,586		$ 7,748
Stock-based compensation	3,750		0
Bond hedge	0		3,019
Accruals for chargebacks and returns	7,603		7,132
Inventory	4,720		1,228
Intangible asset	14,923		9,393
Net operating loss carryforwards	4,767		5,604
Other	1,459		4,682
Total deferred tax assets	45,808		38,806
Deferred tax liabilities:
Depreciation	(6,029)		(4,437)
Debt discount	0		(1,316)
Intangible assets	(13)		(11)
Other	(1,008)		(2,813)
Total deferred tax liabilities	(7,050)		(8,577)
Valuation allowance	(432)	$ (100)	(2,265)
Deferred tax assets, net of deferred tax liabilities and valuation allowance	$ 38,326		$ 27,964

INCOME TAXES - Additional information (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Jan. 01, 2019	Aug. 06, 2018
Deferred Tax Assets, Valuation Allowance	$ 432				$ 2,265				$ 432	$ 2,265		$ 100
Deferred Tax Assets, Net	38,326				27,964				38,326	27,964
Benefit/(provision) for income taxes	2,817	$ (64)	$ 653	$ (469)	(1,910)	$ (1,329)	$ (726)	$ (592)	$ 2,937	$ (4,557)	$ (17,425)
Effective income tax rate continuing operations									(93.00%)	22.70%	106.60%
Pre-tax consolidated income									$ 3,157	$ 20,051	$ 16,349
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent									21.00%	21.00%	35.00%
Operating Loss Carryforwards, Limitations on Use									approximately $0.8 million per year.
Operating Loss Carryforwards	11,300								$ 11,300
ANI Canada [Member]
Deferred Tax Assets, Valuation Allowance	400				1,900				400	$ 1,900
Deferred Tax Assets, Net													$ 1,900
Operating Loss Carryforwards	$ 7,900				$ 300				$ 7,900	$ 300

COMMITMENTS AND CONTINGENCIES - Operating Leases Rent expense (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2019 USD ($)
Operating lease, weighted average remaining lease term	2 years 4 months 24 days
Operating lease costs	$ 190
Variable lease costs	60
Total lease costs	$ 250
Minimum
Operating lease liability (in percent)	4.02%
Maximum
Operating lease liability (in percent)	8.95%

COMMITMENTS AND CONTINGENCIES - Maturity analysis of operating leases (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Jan. 01, 2019	Dec. 31, 2018
COMMITMENTS AND CONTINGENCIES
2020	$ 214
2021	152
2022	111
2023	40
2024	3
Total	520
Discount	(31)
Lease liability	$ 489	$ 500
Operating Lease, Liability, Statement of Financial Position [Extensible List]	us-gaap:AccruedLiabilitiesCurrent us-gaap:OtherLiabilitiesNoncurrent	us-gaap:AccruedLiabilitiesCurrent us-gaap:OtherLiabilitiesNoncurrent
Current lease liability	$ (197)
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List]	Accrued Liabilities, Current
Non-current lease liability	$ 292
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List]	Other Liabilities, Noncurrent
2019			$ 100
2020			100
2021			100
2022			$ 100

COMMITMENTS AND CONTINGENCIES (Details) $ in Thousands	3 Months Ended								12 Months Ended
COMMITMENTS AND CONTINGENCIES (Details) $ in Thousands	Dec. 31, 2019 USD ($)	Sep. 30, 2019 USD ($)	Jun. 30, 2019 USD ($)	Mar. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)	Sep. 30, 2018 USD ($)	Jun. 30, 2018 USD ($)	Mar. 31, 2018 USD ($)	Dec. 31, 2020 USD ($) item	Dec. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
COMMITMENTS AND CONTINGENCIES
Revenue, Net	$ 47,966	$ 51,337	$ 54,357	$ 52,887	$ 57,122	$ 50,703	$ 47,268	$ 46,483		$ 206,547	$ 201,576	$ 176,842
Operating Lease, Weighted Average Remaining Lease Term	2 years 4 months 24 days									2 years 4 months 24 days
Scenario, Forecast [Member]
COMMITMENTS AND CONTINGENCIES
Long-term Purchase Commitment, Amount									$ 15,200
Number of Vendors \| item									4
Unapproved Products [Member]
COMMITMENTS AND CONTINGENCIES
Revenue, Net										$ 20,700	24,900	27,600
Unapproved Products [Member] \| Contract Customer [Member]
COMMITMENTS AND CONTINGENCIES
Revenue, Net										$ 3,100	$ 2,000	$ 2,000

CORTROPHIN PRE-LAUNCH CHARGES (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Cortrophin Pre Launch Charges	$ 6,500	$ 6,706	$ 0	$ 0
Minimum
Projected cortrophin pre-launch charges for 2020		11,000
Maximum
Projected cortrophin pre-launch charges for 2020		$ 12,000

SUBSEQUENT EVENTS (Details) - Subsequent Event [Member] - Amerigen Pharmaceuticals, Ltd. $ in Millions	Jan. 08, 2020 USD ($) item
SUBSEQUENT EVENTS
Number Of Generic Drug Products Acquired \| item	23
Finite-lived intangible assets acquired	$ 52.5
Amount of contingent profit share payments	$ 25.0
Number of years contingent profit share payable	4 years
Payments to acquire intangible assets	$ 4.0

QUARTERLY FINANCIAL DATA (Details) - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
QUARTERLY FINANCIAL DATA
Net revenues		$ 47,966	$ 51,337	$ 54,357	$ 52,887	$ 57,122	$ 50,703	$ 47,268	$ 46,483	$ 206,547	$ 201,576	$ 176,842
Total operating expenses		52,637	44,009	45,065	48,485	45,677	40,589	40,005	39,946	190,196	166,217	148,513
Operating income		(4,671)	7,328	9,292	4,402	11,445	10,114	7,263	6,537	16,351	35,359	28,329
(Provision)/benefit for income taxes		2,817	(64)	653	(469)	(1,910)	(1,329)	(726)	(592)	2,937	(4,557)	(17,425)
Net income/(loss)		$ (4,835)	$ 3,895	$ 6,585	$ 449	$ 5,430	$ 5,037	$ 2,777	$ 2,250	$ 6,094	$ 15,494	$ (1,076)
Basic and diluted earnings/(loss) per share:
Basic earnings/(loss) per share		$ (0.41)	$ 0.32	$ 0.55	$ 0.04	$ 0.46	$ 0.43	$ 0.24	$ 0.19	$ 0.51	$ 1.31	$ (0.09)
Diluted earnings/(loss) per share		$ (0.41)	$ 0.32	$ 0.53	$ 0.04	$ 0.46	$ 0.42	$ 0.23	$ 0.19	$ 0.50	$ 1.30	$ (0.09)
Inventory Reserve Charges	$ 4,600	$ 4,600
Cortrophin pre-launch charges		$ 6,500								$ 6,706	$ 0	$ 0