Research and development
Research and development expenses were $18.0 million for the third quarter of 2012, compared with $20.2 million for the third quarter of 2011. The decrease in research and development expenses was primarily due to a reduction in costs associated with clinical development activities and the production of prelaunch Gattex inventory.
General and administrative
General and administrative expenses were $8.3 million for the third quarter of 2012, compared with $6.4 million for the third quarter of 2011. The increase in general and administrative expenses was primarily due to commercial-readiness activities for Gattex.Interest expense Interest expense was $4.4 million for the third quarter of 2012 and $10.6 million for the third quarter of 2011. Interest expense is largely attributable to non-recourse debt secured by the company’s Sensipar/Mimpara, REGPARA, and Preotact royalties. The decline in interest expense was primarily attributable to a reduction in the outstanding principal and interest rate associated with Sensipar/Mimpara-secured non-recourse debt. Cash and investments At September 30, 2012, the company’s cash, cash equivalents, and marketable investment securities totaled approximately $119 million compared with $162 million at December 31, 2011. Long-term debt At September 30, 2012, the company’s only recourse debt was $16.5 million in 5.75% convertible notes due in 2014. All other debt on the company’s balance sheet is non-recourse and solely secured by its royalty rights related to Sensipar/Mimpara, Preotact, and REGPARA. After repayment of these obligations, as set forth in the agreements, the cash flows from the royalties will be paid to NPS. The following table reflects the company’s non-recourse debt at September 30, 2012 and December 31, 2011:
| September 30,
|Total non-recourse debt||166.4||211.4|
|Less current portion||7.0||19.3|
|Total long-term non-recourse debt||$159.4||$192.1|