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Restructuring Charges | 9 Months Ended
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Sep. 30, 2016
Restructuring Charges | 16. Restructuring Charges In September 2016, the Company initiated a restructuring of its organization in order to conserve resources for commercial sales and marketing of Afrezza and to align product manufacturing in support of these commercial efforts (“2016 Restructuring”). In connection with the 2016 Restructuring, the Company reduced its total workforce by approximately 18% to 155 employees. The Company recorded charges of approximately $1.5 million, primarily for employee severance as well as other related termination benefits and recognized a liability of $1.5 million as of September 30, 2016, which approximates fair value. The Company expects to substantially pay out the obligation for the 2016 Restructuring in the fourth quarter of 2016. The $1.5 million of costs associated with the 2016 Restructuring are included in cost of goods sold, research and development and selling, general and administrative in the condensed consolidated statements of operations as $0.4 million, $0.7 million and $0.4 million, respectively, for the three and nine months ended September 30, 2016. In September 2015, the Company initiated a restructuring of the organization as a result of its shift to commercial production of Afrezza (“2015 Restructuring”). In connection with the 2015 Restructuring, the Company reduced its total workforce by approximately 26% to 198 employees. The Company recorded charges of approximately $3.2 million, primarily for employee severance as well as other related termination benefits and recognized a liability of $3.2 million as of September 30, 2015, which approximates fair value. The $3.2 million of costs associated with the 2015 Restructuring are included in operating expenses for research and development and selling, general and administrative in the condensed consolidated statements of operations as $2.0 million and $1.2 million, respectively, for the three and nine months ended September 30, 2015. During the quarter ended December 31, 2015, the Company recorded additional charges related to employee severance and other related termination benefits in the amount of $2.8 million, meaning it had recorded restructuring charges of $6.0 million for the year ended December 31, 2015. This additional $2.8 million of costs are included in research and development and selling, general and administrative in the condensed consolidated statements of operations as $0.7 million and $2.1 million, respectively. As of September 30, 2016 and December 31, 2015, the Company had a remaining accrual balance for the 2015 Restructuring of $1.7 million and $3.0 million, respectively. The Company expects to substantially pay out the remainder of this obligation by the third quarter of 2017. A reconciliation of beginning and ending liability balances for the restructuring charges is as follows (in thousands):
Description |  | 2016 Restructuring |  |  | 2015 Restructuring |  |  | Total |
Accrual - September 30, 2015 |  | $ | — |  |  | $ | 3,149 |  |  | $ | 3,149 |
Costs incurred and charged to expense |  |  | — |  |  |  | 2,891 |  |  |  | 2,891 |
Costs paid or settled |  |  | — |  |  |  | (3,012 | ) |  |  | (3,012 | )
Accrual - December 31, 2015 |  |  | — |  |  |  | 3,028 |  |  |  | 3,028 |
Costs incurred and charged to expense |  |  | 1,475 |  |  |  | 547 |  |  |  | 2,022 |
Costs paid or settled |  |  | — |  |  |  | (1,865 | ) |  |  | (1,865 | )
Accrual - September 30, 2016 |  | $ | 1,475 |  |  | $ | 1,710 |  |  | $ | 3,185 |

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- Definition The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 5.P.4) -URI http://asc.fasb.org/extlink&oid=27011515&loc=d3e140904-122747 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB Topic 5.P.3) -URI http://asc.fasb.org/extlink&oid=27011515&loc=d3e140864-122747 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6394359&loc=d3e17939-110869 + Details
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