we believe we have identified key factors that contributed to the differences observed in the results from stride 2 compared to those of stride 1 and the phase 2 trial , and that changes made to the inclusion/exclusion criteria of stride 3 based on these analyses will improve the probability of success . if approved , kpi-121 0.25 % could be the first fda-approved product for the temporary relief of the signs and symptoms of dry eye disease . inveltys is the first and only fda‑approved ocular corticosteroid product with a twice-a-day dosing regimen for the treatment of post‑operative inflammation and pain . other approved topical ocular corticosteroid products for this indication are dosed four times a day . in clinical trials , inveltys showed statistical significance in the primary efficacy endpoints of complete resolution of inflammation at day eight maintained through day 15 with no need for rescue medication compared to placebo and complete resolution of pain at day eight maintained through day 15 with no need for rescue medications compared to placebo . we are evaluating opportunities for mpp nanosuspensions of le with less frequent daily dosing regimens for the temporary relief of signs and symptoms of dry eye disease and potential chronic treatment of dry eye disease . we also are evaluating compounds in our receptor tyrosine kinase inhibitor program , or rtki program , that inhibit the vascular endothelial growth factor , or vegf , pathway , for the potential treatment of a number of retinal diseases . inveltys received fda approval under section 505 ( b ) ( 2 ) of the u.s. federal food , drug and cosmetic act , or the fdca , which is the pathway we plan to rely on for the approval of kpi‑121 0.25 % as well . we have retained worldwide commercial rights for inveltys and our current product candidates . since fda approval of inveltys , we have built a commercial infrastructure with our own focused , specialty sales force which includes 57 territory sales managers , 7 regional sales leaders and 3 directors of national accounts . if kpi-121 0.25 % is approved for the temporary treatment of dry eye disease , we expect to further expand our sales force by up to an additional 100 personnel . we expect to commercialize in the united states any of our other product candidates that receive marketing approval as well . in anticipation of the potential to commercialize our product candidates in other global markets , we are evaluating a variety of collaboration , distribution and other marketing arrangements with one or more third parties . on july 25 , 2017 , we completed our initial public offering of our common stock , or ipo , pursuant to which we issued and sold 6,900,000 shares of our common stock at a price of $ 15.00 per share , which included 900,000 shares sold pursuant to the exercise of the underwriters ' option to purchase additional shares . we received net proceeds of $ 94.0 million , after deducting underwriting discounts and commissions and offering expenses . on august 9 , 2018 , we filed a shelf registration statement on form s-3 , or shelf registration , with the sec , which was declared effective on august 27 , 2018. under the shelf registration , we may offer and sell up to $ 250.0 million of a variety of securities including common stock , preferred stock , warrants , depositary shares , debt securities , purchase contracts , purchase units or any combination of such securities during the three-year period that commenced upon the shelf registration becoming effective . under the shelf registration , we may periodically offer one or more types of securities in amounts , at prices and on terms announced , if and when the securities are ever offered . on october 5 , 2018 , we sold 7,500,000 shares of our common stock in an underwritten offering pursuant to the shelf registration at a public offering price of $ 8.25 per share , before underwriting discounts and commissions . in addition , the underwriters were granted an option to purchase an additional 1,125,000 shares of the common stock at the same public offering price , less underwriting discounts and commissions . on october 11 , 2018 , the underwriters exercised in full their option to purchase the additional shares . the total number of shares sold by us in the offering was 8,625,000 shares , resulting in net proceeds to us , after underwriting discounts and offering expenses , of approximately $ 66.1 million . in connection with the filing of the shelf registration , we entered into a sales agreement with jefferies , llc pursuant to which we may issue and sell , from time to time , up to an aggregate of $ 50.0 million of our common stock in at-the-market equity offerings , or the atm offering , through jefferies , llc , as sales agent . as of december 31 , 2018 , we had issued 518,135 shares of our common stock under the atm offering resulting in net proceeds to us of approximately $ 4.6 million . 104 on october 1 , 2018 , we entered into a $ 110 million credit agreement with athyrium opportunities iii acquisition lp , or the athyrium credit facility . the athyrium credit facility provides for a term loan a in the aggregate principal amount of $ 75.0 million , or the term loan a , and a term loan b in the aggregate principal amount of $ 35.0 million , or the athyrium term loan b. on october 1 , 2018 , we borrowed the entire principal amount of the term a loan . story_separator_special_tag the following table summarizes our stock‑based compensation expenses for employees and non‑employee consultants ' incurred during the years ended december 31 , 2018 and 2017 ( in thousands ) : replace_table_token_4_th as of december 31 , 2018 and 2017 , we had $ 21.1 million and $ 15.4 million of total unrecognized compensation expense , which is expected to be recognized over a weighted average remaining vesting period of approximately 2.84 years and 3.11 years . we expect the impact of our stock‑based compensation expense for stock 109 options to employees and non‑employee consultants to grow in future periods due to the potential increases in the value of our common stock and headcount . emerging growth company status in april 2012 , the jumpstart our business startup act , or jobs act , was enacted by the federal government . section 107 of the jobs act provides that an emerging growth company can take advantage of the extended transition period for complying with new or revised accounting standards . thus , an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies . we have irrevocably elected not to avail ourselves of this extended transition period and , as a result , we will adopt new or revised accounting standards on the relevant dates on which adoption of such standards is required for other public companies . results of operations comparison of the years ended december 31 , 2018 and 2017 the followi ng table summarizes the results of our operations for the years ended december 31 , 2018 and 2017 : replace_table_token_5_th research and development expenses replace_table_token_6_th research and development expenses were $ 29.3 million for the year ended december 31 , 2018 compared to $ 29.0 million for the year ended december 31 , 2017. significant changes within research and development were a $ 4.3 million decrease in kpi ‑ 121 development costs due to the decrease in external costs associated with the completion of our phase 3 clinical trials of stride 1 and stride 2 , our phase 3 clinical trials of kpi-121 0.25 % for the treatment of dry eye disease in 2017 , partially offset by costs incurred for stride 3 , our additional phase 3 clinical trial of kpi-121 0.25 % which began during the year ended december 31 2018 and the prescription drug user fee act ( pdufa ) fee paid in connection with the filing of our nda for kpi-121 0.25 % . employee-related costs increased by $ 4.8 million , comprised of a $ 3.4 million increase related to additional clinical and regulatory and quality operations headcount , overall merit increases and a $ 1.4 million increase in stock compensation expense from stock option grants . other 110 research and development costs decreased by $ 0.2 million primarily associated with an $ 0.5 million increase clinical consulting services and a $ 0.7 million reduction in facility costs related to research and development . selling , general and administrative expenses selling , general and administrative expenses were $ 35.4 million for the year ended december 31 , 2018 compared to $ 10.9 million for the year ended december 31 , 2017 , an increase of $ 24.6 million . this increase was primarily due to a $ 12.2 million increase in employee ‑ related costs comprised of a $ 8.6 million increase in selling , general and administrative salaries and benefits expenses due to the hiring of additional employees and overall merit increases , and a $ 3.6 million increase in stock compensation expense related to increased stock options being granted during the year . professional services associated with accounting and legal fees and other general administrative costs increased by $ 2.0 million as a result of operating as a public company for the full year ended december 31 , 2018. costs associated with the building of our commercial organization in advance of the launch of inveltys in early 2019 increased by $ 9.3 million and our facility costs increased by $ 1.1 million due to additional leased space , commencement of our watertown lease and a larger allocation of our overall facility-related costs . interest income interest income was $ 1.7 million for the year ended december 31 , 2018 compared to $ 0.5 million for the year ended december 31 , 2017 an increase of $ 1.2 million . interest income consists of interest earned on our cash balance held in an interest bearing deposit account . the increase was attributable to a higher interest rate and higher average cash balance during the year ended december 31 , 2018 due to receipt of the proceeds from the sale of our common stock in at-the-market equity offerings in the fourth quarter of 2018 , from the sale of shares of our common stock in an underwritten offering in october 2018 and from our athyrium credit facility in october 2018. interest expense interest expense was $ 3.3 million for the year ended december 31 , 2018 compared to $ 1.0 million for the year ended december 31 , 2017 , an increase of $ 2.3 million . the interest expense was comprised of the contractual coupon interest and the amortization of the debt discount associated with our 2014 debt facility and our athyrium credit facility . the increase was primarily due to the october 2018 draw down of $ 75.0 million under the athyrium credit facility . loss on extinguishment of debt the loss of extinguishment of debt was $ 0.4 million for the year ended december 31 , 2018. there was no loss on extinguishment of debt for the year ended december 31 , 2017. upon the repayment in full of the principal balance and related outstanding interest under the 2014 debt facility , the unamortized debt discount and prepayment penalty was recorded as loss on extinguishment of debt for the year ended december 31 , 2018. change in fair value

cash flows as of december 31 , 2018 and 2017 , we had $ 170.9 million and $ 114.6 million in cash on hand and $ 75.0 million and $ 18.9 million in indebtedness , respectively . the indebtedness represents the aggregate outstanding principal amount under the athyrium credit facility and 2014 debt facility , respectively . the following table summarizes our sources and uses of cash for each of the periods presented : replace_table_token_7_th operating activities during the year ended december 31 , 2018 , our cash used in operating activities was primarily due to our net loss of $ 66.7 million as we incurred external research and development costs associated with our clinical trials and selling , general and administrative costs partially offset by non‑cash charges of $ 10.2 million , consisting primarily of a $ 1.2 million related to amortization of the right-of-use assets , debt discount and depreciation , $ 8.6 million in stock‑based compensation , $ 0.4 million in loss for extinguishment of the 2014 debt facility and net cash provided by changes in our operating assets and liabilities of $ 2.4 million . the changes in our operating assets and liabilities of $ 2.4 million primarily due to an increase of $ 8.6 million in accrued expenses and accounts payable partially offset by a decrease of $ 0.4 million in lease liabilities and other long-term liabilities primarily due to principal lease payments , and an increase of $ 5.8 million primarily driven by inventory related to inveltys and receivable related to the construction of our watertown facility .


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```cash flows as of december 31 , 2018 and 2017 , we had $ 170.9 million and $ 114.6 million in cash on hand and $ 75.0 million and $ 18.9 million in indebtedness , respectively . the indebtedness represents the aggregate outstanding principal amount under the athyrium credit facility and 2014 debt facility , respectively . the following table summarizes our sources and uses of cash for each of the periods presented : replace_table_token_7_th operating activities during the year ended december 31 , 2018 , our cash used in operating activities was primarily due to our net loss of $ 66.7 million as we incurred external research and development costs associated with our clinical trials and selling , general and administrative costs partially offset by non‑cash charges of $ 10.2 million , consisting primarily of a $ 1.2 million related to amortization of the right-of-use assets , debt discount and depreciation , $ 8.6 million in stock‑based compensation , $ 0.4 million in loss for extinguishment of the 2014 debt facility and net cash provided by changes in our operating assets and liabilities of $ 2.4 million . the changes in our operating assets and liabilities of $ 2.4 million primarily due to an increase of $ 8.6 million in accrued expenses and accounts payable partially offset by a decrease of $ 0.4 million in lease liabilities and other long-term liabilities primarily due to principal lease payments , and an increase of $ 5.8 million primarily driven by inventory related to inveltys and receivable related to the construction of our watertown facility .
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 Suspicious Activity Report : we believe we have identified key factors that contributed to the differences observed in the results from stride 2 compared to those of stride 1 and the phase 2 trial , and that changes made to the inclusion/exclusion criteria of stride 3 based on these analyses will improve the probability of success . if approved , kpi-121 0.25 % could be the first fda-approved product for the temporary relief of the signs and symptoms of dry eye disease . inveltys is the first and only fda‑approved ocular corticosteroid product with a twice-a-day dosing regimen for the treatment of post‑operative inflammation and pain . other approved topical ocular corticosteroid products for this indication are dosed four times a day . in clinical trials , inveltys showed statistical significance in the primary efficacy endpoints of complete resolution of inflammation at day eight maintained through day 15 with no need for rescue medication compared to placebo and complete resolution of pain at day eight maintained through day 15 with no need for rescue medications compared to placebo . we are evaluating opportunities for mpp nanosuspensions of le with less frequent daily dosing regimens for the temporary relief of signs and symptoms of dry eye disease and potential chronic treatment of dry eye disease . we also are evaluating compounds in our receptor tyrosine kinase inhibitor program , or rtki program , that inhibit the vascular endothelial growth factor , or vegf , pathway , for the potential treatment of a number of retinal diseases . inveltys received fda approval under section 505 ( b ) ( 2 ) of the u.s. federal food , drug and cosmetic act , or the fdca , which is the pathway we plan to rely on for the approval of kpi‑121 0.25 % as well . we have retained worldwide commercial rights for inveltys and our current product candidates . since fda approval of inveltys , we have built a commercial infrastructure with our own focused , specialty sales force which includes 57 territory sales managers , 7 regional sales leaders and 3 directors of national accounts . if kpi-121 0.25 % is approved for the temporary treatment of dry eye disease , we expect to further expand our sales force by up to an additional 100 personnel . we expect to commercialize in the united states any of our other product candidates that receive marketing approval as well . in anticipation of the potential to commercialize our product candidates in other global markets , we are evaluating a variety of collaboration , distribution and other marketing arrangements with one or more third parties . on july 25 , 2017 , we completed our initial public offering of our common stock , or ipo , pursuant to which we issued and sold 6,900,000 shares of our common stock at a price of $ 15.00 per share , which included 900,000 shares sold pursuant to the exercise of the underwriters ' option to purchase additional shares . we received net proceeds of $ 94.0 million , after deducting underwriting discounts and commissions and offering expenses . on august 9 , 2018 , we filed a shelf registration statement on form s-3 , or shelf registration , with the sec , which was declared effective on august 27 , 2018. under the shelf registration , we may offer and sell up to $ 250.0 million of a variety of securities including common stock , preferred stock , warrants , depositary shares , debt securities , purchase contracts , purchase units or any combination of such securities during the three-year period that commenced upon the shelf registration becoming effective . under the shelf registration , we may periodically offer one or more types of securities in amounts , at prices and on terms announced , if and when the securities are ever offered . on october 5 , 2018 , we sold 7,500,000 shares of our common stock in an underwritten offering pursuant to the shelf registration at a public offering price of $ 8.25 per share , before underwriting discounts and commissions . in addition , the underwriters were granted an option to purchase an additional 1,125,000 shares of the common stock at the same public offering price , less underwriting discounts and commissions . on october 11 , 2018 , the underwriters exercised in full their option to purchase the additional shares . the total number of shares sold by us in the offering was 8,625,000 shares , resulting in net proceeds to us , after underwriting discounts and offering expenses , of approximately $ 66.1 million . in connection with the filing of the shelf registration , we entered into a sales agreement with jefferies , llc pursuant to which we may issue and sell , from time to time , up to an aggregate of $ 50.0 million of our common stock in at-the-market equity offerings , or the atm offering , through jefferies , llc , as sales agent . as of december 31 , 2018 , we had issued 518,135 shares of our common stock under the atm offering resulting in net proceeds to us of approximately $ 4.6 million . 104 on october 1 , 2018 , we entered into a $ 110 million credit agreement with athyrium opportunities iii acquisition lp , or the athyrium credit facility . the athyrium credit facility provides for a term loan a in the aggregate principal amount of $ 75.0 million , or the term loan a , and a term loan b in the aggregate principal amount of $ 35.0 million , or the athyrium term loan b. on october 1 , 2018 , we borrowed the entire principal amount of the term a loan . story_separator_special_tag the following table summarizes our stock‑based compensation expenses for employees and non‑employee consultants ' incurred during the years ended december 31 , 2018 and 2017 ( in thousands ) : replace_table_token_4_th as of december 31 , 2018 and 2017 , we had $ 21.1 million and $ 15.4 million of total unrecognized compensation expense , which is expected to be recognized over a weighted average remaining vesting period of approximately 2.84 years and 3.11 years . we expect the impact of our stock‑based compensation expense for stock 109 options to employees and non‑employee consultants to grow in future periods due to the potential increases in the value of our common stock and headcount . emerging growth company status in april 2012 , the jumpstart our business startup act , or jobs act , was enacted by the federal government . section 107 of the jobs act provides that an emerging growth company can take advantage of the extended transition period for complying with new or revised accounting standards . thus , an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies . we have irrevocably elected not to avail ourselves of this extended transition period and , as a result , we will adopt new or revised accounting standards on the relevant dates on which adoption of such standards is required for other public companies . results of operations comparison of the years ended december 31 , 2018 and 2017 the followi ng table summarizes the results of our operations for the years ended december 31 , 2018 and 2017 : replace_table_token_5_th research and development expenses replace_table_token_6_th research and development expenses were $ 29.3 million for the year ended december 31 , 2018 compared to $ 29.0 million for the year ended december 31 , 2017. significant changes within research and development were a $ 4.3 million decrease in kpi ‑ 121 development costs due to the decrease in external costs associated with the completion of our phase 3 clinical trials of stride 1 and stride 2 , our phase 3 clinical trials of kpi-121 0.25 % for the treatment of dry eye disease in 2017 , partially offset by costs incurred for stride 3 , our additional phase 3 clinical trial of kpi-121 0.25 % which began during the year ended december 31 2018 and the prescription drug user fee act ( pdufa ) fee paid in connection with the filing of our nda for kpi-121 0.25 % . employee-related costs increased by $ 4.8 million , comprised of a $ 3.4 million increase related to additional clinical and regulatory and quality operations headcount , overall merit increases and a $ 1.4 million increase in stock compensation expense from stock option grants . other 110 research and development costs decreased by $ 0.2 million primarily associated with an $ 0.5 million increase clinical consulting services and a $ 0.7 million reduction in facility costs related to research and development . selling , general and administrative expenses selling , general and administrative expenses were $ 35.4 million for the year ended december 31 , 2018 compared to $ 10.9 million for the year ended december 31 , 2017 , an increase of $ 24.6 million . this increase was primarily due to a $ 12.2 million increase in employee ‑ related costs comprised of a $ 8.6 million increase in selling , general and administrative salaries and benefits expenses due to the hiring of additional employees and overall merit increases , and a $ 3.6 million increase in stock compensation expense related to increased stock options being granted during the year . professional services associated with accounting and legal fees and other general administrative costs increased by $ 2.0 million as a result of operating as a public company for the full year ended december 31 , 2018. costs associated with the building of our commercial organization in advance of the launch of inveltys in early 2019 increased by $ 9.3 million and our facility costs increased by $ 1.1 million due to additional leased space , commencement of our watertown lease and a larger allocation of our overall facility-related costs . interest income interest income was $ 1.7 million for the year ended december 31 , 2018 compared to $ 0.5 million for the year ended december 31 , 2017 an increase of $ 1.2 million . interest income consists of interest earned on our cash balance held in an interest bearing deposit account . the increase was attributable to a higher interest rate and higher average cash balance during the year ended december 31 , 2018 due to receipt of the proceeds from the sale of our common stock in at-the-market equity offerings in the fourth quarter of 2018 , from the sale of shares of our common stock in an underwritten offering in october 2018 and from our athyrium credit facility in october 2018. interest expense interest expense was $ 3.3 million for the year ended december 31 , 2018 compared to $ 1.0 million for the year ended december 31 , 2017 , an increase of $ 2.3 million . the interest expense was comprised of the contractual coupon interest and the amortization of the debt discount associated with our 2014 debt facility and our athyrium credit facility . the increase was primarily due to the october 2018 draw down of $ 75.0 million under the athyrium credit facility . loss on extinguishment of debt the loss of extinguishment of debt was $ 0.4 million for the year ended december 31 , 2018. there was no loss on extinguishment of debt for the year ended december 31 , 2017. upon the repayment in full of the principal balance and related outstanding interest under the 2014 debt facility , the unamortized debt discount and prepayment penalty was recorded as loss on extinguishment of debt for the year ended december 31 , 2018. change in fair value

