17 the company has structured a new management team to implement this plan . the team brings a wealth of experience in the generic pharmaceutical industry to igi . igi 's facilities and manufacturing equipment have been designed to produce topical and liquid products and support the company 's target prescription dosage forms . contract manufacturing services will continue to be crucial to igi 's success . the customer base for these services is pharmaceutical companies as well as cosmetic , cosmeceutical , and otc product marketers who require product development/manufacturing support . this is a highly-competitive market with a number of larger , greater-resourced companies offering similar services . igi looks to create niche opportunities for itself by providing high quality , customer-oriented service . igi plans to build a prescription pharmaceutical portfolio in the specialty areas of topical dosage forms . this will be accomplished through in-house formulation and development , and submission of andas to the fda . the entire approval process can take 3-5 years before a product is approved , of which the fda approval portion is approximately 18 - 24 months . the company plans to submit multiple andas each year . igi has exclusive rights for the use of novasome® technology in topical formulations and intends to pursue collaboration opportunities with established pharmaceutical companies seeking to develop topical products with unique properties . in addition , the company will explore line extension opportunities through innovative packaging or alternate dosage forms of existing pharmaceutical molecules . recent events in december 2010 , we completed a $ 6,500,000 private placement for the sale of 5,909,087 shares of the company 's common stock resulting in net proceeds of approximately $ 5,696,000 as more fully described in note 10 to our consolidated financial statements . in december 2010 , we entered into a credit agreement for a $ 3,000,000 credit facility as more fully described in note 6 to our consolidated financial statements . to secure payment of amounts financed , we have granted to the lender a security interest in and against , generally , all of our tangible and intangible assets , except intellectual property . results of operations 2010 compared to 2009 the company had a net loss attributable to common stockholders of $ 4,707,000 , or $ ( 0.20 ) per share , in 2010 compared to a net loss of $ 7,408,000 , or $ ( 0.46 ) per share , in 2009 which resulted from the following : replace_table_token_1_th the increase in product sales for the year ended december 31 , 2010 as compared to the same period in 2009 was primarily due to increased annual product sales to the company 's major customers and product sales to new customers . research and development income will not be consistent and will vary , from period to period , depending on the required timeline of each development project . the increase in research and development income during the year ended december 31 , 2010 as compared to the same period in 2009 is attributable to new customer relationships and their desire to have the company develop , manufacture and package their new products or line extensions and the continued strong relationships with our current customer base . licensing and royalty income decreased due to the decrease in sales of novasome based products marketed by our licensees . the company believes the loss of certain royalties is related to the normal life cycle of the products and that certain royalties of the company may continue to decline . for the years ended costs of sales december 31 , 2010 december 31 , 2009 $ change % change ( in thousands ) cost of sales $ 4,989 $ 3,527 $ 1,462 41 % 18 cost of sales increased by approximately $ 1,292,000 for the year ended december 31 , 2010 as a result of the increase in product sales by 61 % . we also had an increase of approximately $ 170,000 due to reserves for products that the company is no longer producing and obsolete and expired inventory for the year ended december 31 , 2010. cost of sales as a percentage of product sales was 97 % for the year ended december 31 , 2010 as compared to 110 % for the year ended december 31 , 2009. replace_table_token_2_th selling , general and administrative expenses for the year period ended december 31 , 2010 decreased as compared to the same period in 2009 as the prior period included a severance expense of $ 341,000 for our former president and chief executive officer per his 2009 separation agreement , a decrease of $ 338,000 in professional and consulting fees and a decrease of $ 62,000 in expense from the issuance of stock options , offset by an increase of $ 262,000 in salaries and related expenses , an increase in directors ' fees of $ 51,000 and an increase of $ 46,000 in travel related expenses . as the company created its pharmaceutical foundation , transitioning from a contract manufacturer to a generic topical pharmaceutical company , product development and research expenses for the year ended december 31 , 2010 increased as compared to the same period for 2009 as follows . salaries and related costs increased $ 419,000 due to establishing a fully staffed quality analytical department , clinical studies expense of $ 131,000 was incurred in 2010 , supplies and outside testing increased by $ 110,000 and the expense from the issuance of stock options increased by $ 64,000. replace_table_token_3_th interest expense decreased for the year ended december 31 , 2010 as compared to the same period in 2009 due to approximately $ 943,000 of accrued interest and amortization of debt discount and debt issuance costs related to the convertible notes story_separator_special_tag in response to an observation by the new jersey dep of pesticide contamination in a portion of its property located at 105 lincoln avenue in buena , atlantic county , new jersey , the company contracted with an environmental and remediation firm to complete soil delineation of the pesticide contamination , its remediation and disposal . the estimated cost for the remediation is $ 65,000 , of which $ 10,000 remains accrued as of december 31 , 2010. based on information provided to the company from its environmental consultant and what is known to date , the company believes the reserve is sufficient for the remaining remediation of the environmental contamination . there is a possibility , however , that the remediation costs may exceed the company 's estimates . long-lived assets the company 's long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable . the recoverability of assets to be held and used is measured by a comparison of the carrying amount of the asset to future net undiscounted cash flows expected to be generated by the asset . if the assets are considered to be impaired , the impairment to be recognized is measured by the amount by which the carrying amount exceeds the fair value of the assets . deferred tax valuation allowance deferred taxes arise due to temporary differences in the bases of assets and liabilities and from net operating losses and credit carry forwards . in general , deferred tax assets represent future tax benefits to be received when certain expenses previously recognized in the company 's statement of operations become deductible expenses under applicable income tax laws or loss or credit carry forwards are utilized . accordingly , realization of deferred tax assets is dependent on future taxable income against which these deductions , losses and credits can be utilized . in assessing the realizability of deferred tax assets , management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized . management considers historical operating losses , scheduled reversals of deferred tax liabilities , projected future taxable income and tax planning strategies in making this assessment . as a result , the company concluded that it was more likely than not that it will be unable to realize the gross deferred tax assets in the foreseeable future and established a valuation reserve for all such deferred tax assets . revenue recognition the company considers revenue realized or realizable and earned when it has persuasive evidence of an arrangement , delivery has occurred or contractual services rendered , the sales price is fixed or determinable , and collection is reasonably assured in conformity with asc 605 , revenue recognition . 22 the company derives its revenues from three basic types of transactions : sales of manufactured product , licensing of technology , and research and product development services performed for third parties . due to differences in the substance of these transaction types , the transactions require , and the company utilizes , different revenue recognition policies for each . product sales : the company recognizes revenue when title transfers to its customers , which is generally upon shipment of products . these shipments are made in accordance with sales commitments and related sales orders entered into with customers either verbally or in written form . the revenues associated with these transactions , net of appropriate cash discounts , product returns and sales reserves , are recorded upon shipment of the products . licensing and royalty income : revenues earned under licensing or sublicensing contracts are recognized ratably over the life of the agreements . advance payments by customers are initially recorded as deferred income on the consolidated balance sheet and then recognized ratably over the life of the agreement or as contract obligations are completed . research and development income : the company establishes agreed upon product development agreements with its customers to perform product development services . product development revenues are recognized in accordance with the product development agreement upon the completion of the phases of development and when we have no future performance obligations relating to that phase of development . revenue recognition requires the company to assess progress against contracted obligations to assure completion of each stage . payments under these arrangements are generally non-refundable and are reported as deferred until they are recognized as revenue . if no such arrangement exists , product development fees are recognized ratably over the entire period during which the services are performed . in making such assessments , judgments are required to evaluate contingencies such as potential variances in schedule and the costs , the impact of change orders , liability claims , contract disputes and achievement of contractual performance standards . changes in total estimated contract cost and losses , if any , are recognized in the period they are determined . billings on product development contracts are typically based upon terms agreed upon by the company and customer and are stated in the contracts themselves and do not always align with the revenues recognized by the company . on occasions when revenue recognized exceeds the milestone or progress billed to our customer , an unbilled receivable is recorded on our consolidated balance sheet . stock-based compensation asc 718-10 defines the fair-value-based method of accounting for stock-based employee compensation plans and transactions used by the company to account for its issuances of equity instruments to record compensation cost for stock-based employee compensation plans at fair value as well as to acquire goods or services from non-employees . transactions in which the company issues stock-based compensation to employees , directors and advisors and for goods or services received from non-employees are accounted for based on the fair value of the equity instruments issued . the company utilizes pricing models in determining the fair values of options

liquidity and capital resources the company 's business operations have been primarily funded over the past two years through private placements of our capital stock . as described more fully in notes 6 , 8 , 9 and 10 to our consolidated financial statements , we raised an aggregate of $ 7,213,000 through private placements of equity with accredited investors in 2010 and $ 5,304,000 in 2009 principally from private equity investors . in 2010 , we also entered into a $ 3,000,000 line of credit . the company may require additional funding and this funding will depend , in part , on the timing and structure of potential business arrangements . if necessary , the company may continue to seek to raise additional capital through the sale of its equity or through a strategic alliance with a third party . there may also be additional acquisition and growth opportunities that may require external financing . there can be no assurance that such financing will be available on terms acceptable to the company , or at all . we believe that our existing capital resources including the recently completed line of credit and private placement detailed below will be sufficient to support our current business plan beyond march 2012. on december 21 , 2010 , we entered into a credit agreement with amzak capital management , llc pursuant to which amzak has agreed to extend a $ 3,000,000 credit facility to the company . the company had no amounts outstanding under the facility at december 31 , 2010. the company drew down $ 500,000 in principal amount in march 2011. to secure payment of the amounts financed under the credit agreement , the company has granted to the lender a security interest in and against , generally , all of its tangible and intangible assets , except intellectual property , pursuant to that certain pledge and security agreement with the lender dated december 21 , 2010. in addition , the company has pledged to the lender its equity interests in igen , inc. , one of the company 's wholly-owned subsidiaries .


 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.
     ```liquidity and capital resources the company 's business operations have been primarily funded over the past two years through private placements of our capital stock . as described more fully in notes 6 , 8 , 9 and 10 to our consolidated financial statements , we raised an aggregate of $ 7,213,000 through private placements of equity with accredited investors in 2010 and $ 5,304,000 in 2009 principally from private equity investors . in 2010 , we also entered into a $ 3,000,000 line of credit . the company may require additional funding and this funding will depend , in part , on the timing and structure of potential business arrangements . if necessary , the company may continue to seek to raise additional capital through the sale of its equity or through a strategic alliance with a third party . there may also be additional acquisition and growth opportunities that may require external financing . there can be no assurance that such financing will be available on terms acceptable to the company , or at all . we believe that our existing capital resources including the recently completed line of credit and private placement detailed below will be sufficient to support our current business plan beyond march 2012. on december 21 , 2010 , we entered into a credit agreement with amzak capital management , llc pursuant to which amzak has agreed to extend a $ 3,000,000 credit facility to the company . the company had no amounts outstanding under the facility at december 31 , 2010. the company drew down $ 500,000 in principal amount in march 2011. to secure payment of the amounts financed under the credit agreement , the company has granted to the lender a security interest in and against , generally , all of its tangible and intangible assets , except intellectual property , pursuant to that certain pledge and security agreement with the lender dated december 21 , 2010. in addition , the company has pledged to the lender its equity interests in igen , inc. , one of the company 's wholly-owned subsidiaries .
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 Suspicious Activity Report : 17 the company has structured a new management team to implement this plan . the team brings a wealth of experience in the generic pharmaceutical industry to igi . igi 's facilities and manufacturing equipment have been designed to produce topical and liquid products and support the company 's target prescription dosage forms . contract manufacturing services will continue to be crucial to igi 's success . the customer base for these services is pharmaceutical companies as well as cosmetic , cosmeceutical , and otc product marketers who require product development/manufacturing support . this is a highly-competitive market with a number of larger , greater-resourced companies offering similar services . igi looks to create niche opportunities for itself by providing high quality , customer-oriented service . igi plans to build a prescription pharmaceutical portfolio in the specialty areas of topical dosage forms . this will be accomplished through in-house formulation and development , and submission of andas to the fda . the entire approval process can take 3-5 years before a product is approved , of which the fda approval portion is approximately 18 - 24 months . the company plans to submit multiple andas each year . igi has exclusive rights for the use of novasome® technology in topical formulations and intends to pursue collaboration opportunities with established pharmaceutical companies seeking to develop topical products with unique properties . in addition , the company will explore line extension opportunities through innovative packaging or alternate dosage forms of existing pharmaceutical molecules . recent events in december 2010 , we completed a $ 6,500,000 private placement for the sale of 5,909,087 shares of the company 's common stock resulting in net proceeds of approximately $ 5,696,000 as more fully described in note 10 to our consolidated financial statements . in december 2010 , we entered into a credit agreement for a $ 3,000,000 credit facility as more fully described in note 6 to our consolidated financial statements . to secure payment of amounts financed , we have granted to the lender a security interest in and against , generally , all of our tangible and intangible assets , except intellectual property . results of operations 2010 compared to 2009 the company had a net loss attributable to common stockholders of $ 4,707,000 , or $ ( 0.20 ) per share , in 2010 compared to a net loss of $ 7,408,000 , or $ ( 0.46 ) per share , in 2009 which resulted from the following : replace_table_token_1_th the increase in product sales for the year ended december 31 , 2010 as compared to the same period in 2009 was primarily due to increased annual product sales to the company 's major customers and product sales to new customers . research and development income will not be consistent and will vary , from period to period , depending on the required timeline of each development project . the increase in research and development income during the year ended december 31 , 2010 as compared to the same period in 2009 is attributable to new customer relationships and their desire to have the company develop , manufacture and package their new products or line extensions and the continued strong relationships with our current customer base . licensing and royalty income decreased due to the decrease in sales of novasome based products marketed by our licensees . the company believes the loss of certain royalties is related to the normal life cycle of the products and that certain royalties of the company may continue to decline . for the years ended costs of sales december 31 , 2010 december 31 , 2009 $ change % change ( in thousands ) cost of sales $ 4,989 $ 3,527 $ 1,462 41 % 18 cost of sales increased by approximately $ 1,292,000 for the year ended december 31 , 2010 as a result of the increase in product sales by 61 % . we also had an increase of approximately $ 170,000 due to reserves for products that the company is no longer producing and obsolete and expired inventory for the year ended december 31 , 2010. cost of sales as a percentage of product sales was 97 % for the year ended december 31 , 2010 as compared to 110 % for the year ended december 31 , 2009. replace_table_token_2_th selling , general and administrative expenses for the year period ended december 31 , 2010 decreased as compared to the same period in 2009 as the prior period included a severance expense of $ 341,000 for our former president and chief executive officer per his 2009 separation agreement , a decrease of $ 338,000 in professional and consulting fees and a decrease of $ 62,000 in expense from the issuance of stock options , offset by an increase of $ 262,000 in salaries and related expenses , an increase in directors ' fees of $ 51,000 and an increase of $ 46,000 in travel related expenses . as the company created its pharmaceutical foundation , transitioning from a contract manufacturer to a generic topical pharmaceutical company , product development and research expenses for the year ended december 31 , 2010 increased as compared to the same period for 2009 as follows . salaries and related costs increased $ 419,000 due to establishing a fully staffed quality analytical department , clinical studies expense of $ 131,000 was incurred in 2010 , supplies and outside testing increased by $ 110,000 and the expense from the issuance of stock options increased by $ 64,000. replace_table_token_3_th interest expense decreased for the year ended december 31 , 2010 as compared to the same period in 2009 due to approximately $ 943,000 of accrued interest and amortization of debt discount and debt issuance costs related to the convertible notes story_separator_special_tag in response to an observation by the new jersey dep of pesticide contamination in a portion of its property located at 105 lincoln avenue in buena , atlantic county , new jersey , the company contracted with an environmental and remediation firm to complete soil delineation of the pesticide contamination , its remediation and disposal . the estimated cost for the remediation is $ 65,000 , of which $ 10,000 remains accrued as of december 31 , 2010. based on information provided to the company from its environmental consultant and what is known to date , the company believes the reserve is sufficient for the remaining remediation of the environmental contamination . there is a possibility , however , that the remediation costs may exceed the company 's estimates . long-lived assets the company 's long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable . the recoverability of assets to be held and used is measured by a comparison of the carrying amount of the asset to future net undiscounted cash flows expected to be generated by the asset . if the assets are considered to be impaired , the impairment to be recognized is measured by the amount by which the carrying amount exceeds the fair value of the assets . deferred tax valuation allowance deferred taxes arise due to temporary differences in the bases of assets and liabilities and from net operating losses and credit carry forwards . in general , deferred tax assets represent future tax benefits to be received when certain expenses previously recognized in the company 's statement of operations become deductible expenses under applicable income tax laws or loss or credit carry forwards are utilized . accordingly , realization of deferred tax assets is dependent on future taxable income against which these deductions , losses and credits can be utilized . in assessing the realizability of deferred tax assets , management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized . management considers historical operating losses , scheduled reversals of deferred tax liabilities , projected future taxable income and tax planning strategies in making this assessment . as a result , the company concluded that it was more likely than not that it will be unable to realize the gross deferred tax assets in the foreseeable future and established a valuation reserve for all such deferred tax assets . revenue recognition the company considers revenue realized or realizable and earned when it has persuasive evidence of an arrangement , delivery has occurred or contractual services rendered , the sales price is fixed or determinable , and collection is reasonably assured in conformity with asc 605 , revenue recognition . 22 the company derives its revenues from three basic types of transactions : sales of manufactured product , licensing of technology , and research and product development services performed for third parties . due to differences in the substance of these transaction types , the transactions require , and the company utilizes , different revenue recognition policies for each . product sales : the company recognizes revenue when title transfers to its customers , which is generally upon shipment of products . these shipments are made in accordance with sales commitments and related sales orders entered into with customers either verbally or in written form . the revenues associated with these transactions , net of appropriate cash discounts , product returns and sales reserves , are recorded upon shipment of the products . licensing and royalty income : revenues earned under licensing or sublicensing contracts are recognized ratably over the life of the agreements . advance payments by customers are initially recorded as deferred income on the consolidated balance sheet and then recognized ratably over the life of the agreement or as contract obligations are completed . research and development income : the company establishes agreed upon product development agreements with its customers to perform product development services . product development revenues are recognized in accordance with the product development agreement upon the completion of the phases of development and when we have no future performance obligations relating to that phase of development . revenue recognition requires the company to assess progress against contracted obligations to assure completion of each stage . payments under these arrangements are generally non-refundable and are reported as deferred until they are recognized as revenue . if no such arrangement exists , product development fees are recognized ratably over the entire period during which the services are performed . in making such assessments , judgments are required to evaluate contingencies such as potential variances in schedule and the costs , the impact of change orders , liability claims , contract disputes and achievement of contractual performance standards . changes in total estimated contract cost and losses , if any , are recognized in the period they are determined . billings on product development contracts are typically based upon terms agreed upon by the company and customer and are stated in the contracts themselves and do not always align with the revenues recognized by the company . on occasions when revenue recognized exceeds the milestone or progress billed to our customer , an unbilled receivable is recorded on our consolidated balance sheet . stock-based compensation asc 718-10 defines the fair-value-based method of accounting for stock-based employee compensation plans and transactions used by the company to account for its issuances of equity instruments to record compensation cost for stock-based employee compensation plans at fair value as well as to acquire goods or services from non-employees . transactions in which the company issues stock-based compensation to employees , directors and advisors and for goods or services received from non-employees are accounted for based on the fair value of the equity instruments issued . the company utilizes pricing models in determining the fair values of options

