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Note 9 - Realignment of Goals and Objectives and New Development Focus
6 Months Ended
Jun. 30, 2018
Notes to Financial Statements  
Restructuring and Related Activities Disclosure [Text Block]
9.
Realignment of Goals and Objectives and New Development Focus
 
Following the approval of SUSTOL and consistent with our transition into a commercial-stage biotechnology company, we realigned our goals and objectives and refocused our development efforts to the area of postoperative pain management. On
September 30, 2016,
the Board of Directors accepted the resignations of
three
executive officers, and these executive officers and other employees directly affected by the realignment and refocusing were or will be provided with
one
-time severance payments upon termination, continued benefits for a specified period of time and outplacement assistance.
 
The total expense for these activities was
$9.6
million,
$5.7
million of which is primarily for severance and
$3.9
million of which is for non-cash, stock-based compensation expense. The total expense was recognized between
September 30, 2016
and
December 31, 2017.
 
We expect to make the final payment resulting from the realignment of our goals and objectives and new development focus in the
third
quarter of
2018.
As of
June 30, 2018,
we have paid
$5.5
million of the total
$5.7
million cash severance charges.
 
In
March 2018,
we shut down operations at our Redwood City facility and entered into a sublease agreement for the remainder of the lease term. The fair value of the cease-use liability was calculated using the remaining lease payments, offset by future sub-lease payments, deferred rent amortization and prepaid rent amounts. In the
first
quarter of
2018,
we recorded expense of
$0.5
million to general and administrative expense as a loss on the lease.
 
We have accounted for these expenses in accordance with ASC Topic
420,
Exit or Disposal Cost Obligations
.