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## Notes to Consolidated Financial Statements (continued) 

## 2. Available-for-Sale Securities 

The following is a summary of our available-for-sale securities at December 31 (in thousands): 

<img src='content_image/101275.jpg'>

The estimated fair value of available-for-sale securities at December 31, 2001 was $104.8 million, with $5.8 million maturing within 1 year and $98.9 million maturing between 1 to 3 years. 

Gross realized gains on sales of marketable securities were $149,000 for the year ended December 31, 2001. Gross realized gains or losses were immaterial for the years ended December 31, 2000 and 1999. 

## 3. Property and Equipment 

Property and equipment consisted of the following at December 31 (in thousands): 

<img src='content_image/101273.jpg'>

Depreciation and amortization expense was $272,000, $196,000 and $174,000 for the years ended December 31, 2001, 2000 and 1999, respectively. 

## 4. Sponsored Research and License Agreements 

We have entered into various agreements with research insti- tutions, universities, and other entities for the performance of research and development activities and for the acquisition of licenses related to those activities. Expenses under these agreements totaled $1.6 million, $1.5 million and $1.3 million in the years ended December 31, 2001, 2000 and 1999, respectively. 

At December 31, 2001, the annual aggregate commitments we have under these agreements, including minimum license payments, are as follows (in thousands): 

<img src='content_image/101274.jpg'>

After 2006, we must make annual payments aggregating $329,000 per year to maintain certain licenses. Certain licenses provide for the payment of royalties by us on future product sales, if any. In addition, in order to maintain these licenses and other rights during product development, we must comply with various conditions including the payment of patent related costs and obtaining additional equity investments. 

## 5. Agreement with Aventis SA 

In 1997, we entered into an exclusive license agreement with Aventis SA (formerly Hoechst Marion Roussel, Inc.). The agreement gave us a worldwide license to the patent rights and know-how related to the antipsychotic agent iloperidone, including the ability to develop, use, sublicense, manufacture and sell products and processes claimed in the patent rights. We are required to make additional benchmark payments as specific milestones are met. Upon commercialization of the product, the license agreement provides that we will pay royalties based on net sales. 

