|ARRAY BIOPHARMA INC filed this Form 10-Q on 05/10/2017|
Concentration of Business Risks
The following counterparties contributed greater than 10% of the Company's total revenue during at least one of the periods set forth below. The revenue from these counterparties as a percentage of total revenue was as follows:
The loss of one or more of the Company's significant partners or collaborators could have a material adverse effect on its business, operating results or financial condition. Although the Company is impacted by economic conditions in the biotechnology and pharmaceutical sectors, management does not believe significant credit risk exists as of March 31, 2017.
The following table details revenue by geographic area based on the country in which the Company's counterparties are located (in thousands):
Novartis Pharmaceutical Ltd. and Novartis Pharma AG (collectively, "Novartis") accounted for 80.2% and 85% of the Company's total accounts receivable balance as of March 31, 2017 and June 30, 2016, respectively. Pierre Fabre Medicament SAS ("Pierre Fabre") accounted for 13.0% and 5.4% of the Company's total accounts receivable balance as of March 31, 2017 and June 30, 2016, respectively.
Summary of Significant Accounting Policies
The Company's other significant accounting policies are described in Note 1 to its audited financial statements for the fiscal year ended June 30, 2016, included in its Annual Report on Form 10-K filed with the SEC.
Prior to September 30, 2016, the shares of preferred stock of VentiRx Pharmaceuticals, Inc. ("VentiRx") that the Company received under a February 2007 collaboration and licensing agreement with VentiRx had a recorded cost of $1.5 million. The Company did not have a controlling interest nor did it exert significant influence over VentiRx. During the quarter ended September 30, 2016, a triggering event occurred related to the underlying viability of the investment, which caused the Company to record a $1.5 million impairment loss related to this investment at that time. During the quarter ended March 31, 2017, Celgene Corporation acquired all of the outstanding capital stock of VentiRx, and the Company received $0.5 million as its share of proceeds from this acquisition and recorded a corresponding realized gain of $0.5 million.