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[SAMNOTSAMUEL]

Bobwins,

The way I and others read this:

"Guidance provided on March 11, 2005 included $9.0 million to $10.5 million of royalties to Lilly in cost of sales. Current guidance does not include these royalties in cost of sales. We will account for the future royalty payments as contingent consideration and will record an adjustment to the carrying amount of the related intangible asset and a cumulative adjustment to the intangible amortization upon achievement of the related sales milestones."

is that it will be amortized along with the initial payment instead of during. If they waited until the actual payout to show in earnings, it would be hard to assess earnings due to quarter inconsistency so I partly agree with what I think they are doing and it could be considered like the upfront. Also next year it is 1/3 royalty I believe instead of 1/2 so it is a judgement call. You are more from accounting world than me, but 'irc...' on yahoo board called attention to this and he is an accountant.

sam