PTIE » Topics » Use of Estimates

This excerpt taken from the PTIE 10-Q filed May 6, 2009.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires that management 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 revenue earned and expenses incurred during the reporting period. Actual results could differ from those estimates.

 

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These excerpts taken from the PTIE 10-K filed Feb 13, 2009.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Use of Estimates

STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%">The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions
that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

These excerpts taken from the PTIE 10-K filed Feb 13, 2008.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Use of
Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management
to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

FACE="Times New Roman" SIZE="2">Revenue Recognition and Deferred Program Fee Revenue

Revenue is recognized when there is
persuasive evidence that an arrangement exists, delivery has occurred, the price is fixed and determinable, and collection is reasonably assured.

SIZE="2">In November 2005, we and King announced a strategic alliance to develop and commercialize Remoxy and other abuse-resistant opioid painkillers. In connection with the strategic alliance, we recognize program fee revenue, collaboration
revenue and milestone revenue. Program fee revenue is derived from the upfront payment from King and is recognized ratably over our estimate of the development period of four drug candidates expected to be developed under the strategic alliance with
King. We currently estimate the development period for all four expected drug candidates to extend through September 2014. We review the estimated development period on a quarterly basis and change it if appropriate based upon our latest
expectations. In the fourth quarter of 2007 we determined that the development period should be extended from the third quarter of 2011 based upon recent clinical developments and communications to us from King regarding King’s development
plans and forecast expenditures. Deferred program fee revenue represents the amount of the upfront payment that has not been recognized as revenue to date.

FACE="Times New Roman" SIZE="2">Collaboration revenues from reimbursement of development expenses are generally recognized as costs are incurred pursuant to the strategic alliance with King; however, when we have knowledge that King has not
completed its review of the collaboration expenses invoiced to them, we defer recognition of such amounts as revenue until their review is complete.

FACE="Times New Roman" SIZE="2">King is obligated to pay us milestone payments contingent upon the achievement of certain substantive events in the clinical development of Remoxy and the other abuse-resistant opioid painkillers under the strategic
alliance. We recognize milestone payments from King as revenue when we achieve the underlying developmental milestone as the milestone payments are not dependent upon any other future activities or achievement of any other future milestones and the
achievement of each of the developmental milestones were substantively at risk and contingent at the effective date of the collaboration. Substantial effort is involved in achieving each of the developmental milestones. These milestones represent
the culmination of discrete earnings processes and the amount of each milestone payment is reasonable in relation with the level of effort associated with the achievement of the milestone. Each milestone payment is non-refundable and non-creditable
when made. The ongoing research and development services being provided to King under the collaboration are priced at fair value based upon the reimbursement of expenses incurred pursuant to the collaboration with King.

STYLE="margin-top:0px;margin-bottom:0px"> 


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PAIN THERAPEUTICS, INC.

ALIGN="center">NOTES TO FINANCIAL STATEMENTS—(Continued)

 


This excerpt taken from the PTIE 10-K filed Feb 26, 2007.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

This excerpt taken from the PTIE 10-K filed Feb 24, 2006.

Use of Estimates

 

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

 

This excerpt taken from the PTIE 10-K filed Feb 16, 2005.

Use of Estimates

 

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

 

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