INVENTORY

12 Months Ended

Dec. 31, 2021

Inventories are stated at the lower of cost and net realizable value with cost determined on a first-in, first-out basis by product. The Company capitalizes inventory costs associated with products following regulatory approval when future commercialization is considered probable and the future economic benefit is expected to be realized. The Company commenced capitalizing inventory for AMZEEQ and ZILXI upon FDA approval in October 2019 and May 2020, respectively. The Company periodically reviews its inventory levels and, if necessary, writes down inventory that is expected to expire prior to being sold, inventory in excess of expected sales requirements and inventory that fails to meet commercial sale specifications, with a corresponding charge to cost of goods sold. There were no material inventory write-downs during the years ended December 31, 2021 and 2020. All inventory was sold or written-off in connection with the sale of the MST Franchise. See Note 17.

The following table sets forth the Company’s inventory:


	December 31
(in thousands)	2021		2020
Raw materials	$	3,298	$	4,042
Work-in-process	33		662
Finished goods	3,960		2,700
Total	$	7,291	$	7,404