Quarterly report pursuant to Section 13 or 15(d)

12. SEGMENT INFORMATION

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12. SEGMENT INFORMATION
6 Months Ended
Jun. 30, 2016
Segment Reporting [Abstract]  
SEGMENT INFORMATION

The Company operates in two distinct business segments: a consumer product segment in manufacturing, marketing and selling plant-based CBD products to a range of market sectors; and, a specialty pharmaceutical segment focused on developing and commercializing novel therapeutics utilizing synthetic CBD. The Company’s segments maintain separate financial information for which operating results are evaluated on a regular basis by the Company’s senior management in deciding how to allocate resources and in assessing performance. The Company evaluates its consumer product segment based on net product sales, gross profit and operating income or loss. The Company currently evaluates its specialty pharmaceutical segment based on the progress of its clinical development programs.


The following table presents information by reportable operating segment for the three and six month periods ended June 30, 2016 and 2015:

 

    Consumer Products Segment     Specialty Pharmaceutical Segment     Consolidated Totals  
Three Months Ended                        
June 30, 2016:                        
Product sales, net   $ 2,487,756     $     $ 2,487,756  
Gross profit     1,664,327             1,664,327  
Selling, general and administrative     3,262,917       122,809       3,385,726  
Research and development     224,266       117,281       341,547  
Operating (loss) income   $ (1,822,856 )   $ (240,090 )   $ (2,062,946 )
                         
June 30, 2015:                        
Product sales, net   $ 2,413,886     $     $ 2,413,886  
Gross profit     1,288,061             1,288,061  
Selling, general and administrative     2,850,053             2,850,053  
Research and development     433,544             433,544  
Operating (loss) income   $ (1,995,536 )   $     $ (1,995,536 )
                         
Six Months Ended                        
June 30, 2016:                        
Product sales, net   $ 4,910,434     $     $ 4,910,434  
Gross profit     3,289,962             3,289,962  
Selling, general and administrative     5,952,161       122,809       6,074,970  
Research and development     366,079       117,281       483,360  
Operating (loss) income   $ (3,028,278 )   $ (240,090 )   $ (3,268,368 )
                         
June 30, 2015:                        
Product sales, net   $ 5,127,938     $     $ 5,127,938  
Gross profit     2,866,007             2,866,007  
Selling, general and administrative     6,787,204             6,787,204  
Research and development     744,022             744,022  
Operating (loss) income   $ (4,665,219 )   $     $ (4,665,219 )