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Document and Entity Information - USD ($)	12 Months Ended
Document and Entity Information - USD ($)	Dec. 31, 2016	Feb. 17, 2017	Jun. 30, 2016
Document and Entity Information
Entity Registrant Name	ROCKWELL MEDICAL, INC.
Entity Central Index Key	0001041024
Document Type	10-K
Document Period End Date	Dec. 31, 2016
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Public Float			$ 318,842,000
Entity Common Stock, Shares Outstanding		51,527,711
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	FY

CONSOLIDATED BALANCE SHEETS - USD ($)	Dec. 31, 2016	Dec. 31, 2015
ASSETS
Cash and Cash Equivalents	$ 17,180,594	$ 31,198,182
Investments available for sale	40,759,703	39,482,732
Accounts Receivable, net of a reserve of $5,000 in 2016 and $75,000 in 2015	6,393,228	5,046,733
Inventory	12,141,072	7,871,780
Other Current Assets	2,034,598	1,026,889
Total Current Assets	78,509,195	84,626,316
Property and Equipment, net	1,391,575	1,646,568
Inventory, Non-Current	1,826,554
Intangible Assets	4,382	165,657
Goodwill	920,745	920,745
Other Non-current Assets	501,187	462,839
Total Assets	83,153,638	87,822,125
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts Payable	5,858,234	3,995,216
Accrued Liabilities	4,210,151	3,831,356
Customer Deposits	77,217	264,879
Total Current Liabilities	10,145,602	8,091,451
Deferred License Revenue	20,051,737	17,410,852
Shareholders' Equity:
Common Shares, no par value, 51,527,711 and 51,501,877 shares issued and outstanding	268,199,939	257,773,494
Accumulated Deficit	(214,341,092)	(194,538,176)
Accumulated Other Comprehensive Income	(902,548)	(915,496)
Total Shareholders' Equity	52,956,299	62,319,822
Total Liabilities And Shareholders' Equity	$ 83,153,638	$ 87,822,125

CONSOLIDATED INCOME STATEMENTS - USD ($)	12 Months Ended
CONSOLIDATED INCOME STATEMENTS - USD ($)	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
CONSOLIDATED INCOME STATEMENTS
Sales	$ 53,284,166	$ 55,350,702	$ 54,188,444
Cost of Sales	46,531,648	46,412,848	45,643,231
Gross Profit	6,752,518	8,937,854	8,545,213
Selling, General and Administrative	21,120,901	19,078,867	18,320,720
Research and Product Development	5,840,346	4,961,313	7,783,594
Operating Income (Loss)	(20,208,729)	(15,102,326)	(17,559,101)
Interest and Investment Income, net	810,340	681,876	386,257
Interest (Expense)			(4,154,313)
Income (Loss) Before Income Taxes	(19,398,389)	(14,420,450)	(21,327,157)
Income Tax Expense	404,527	0	0
Net Income (Loss)	$ (19,802,916)	$ (14,420,450)	$ (21,327,157)
Basic Earnings (Loss) per Share	$ (0.39)	$ (0.29)	$ (0.52)
Diluted Earnings (Loss) per Share	$ (0.39)	$ (0.29)	$ (0.52)

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($)	COMMON SHARES	PURCHASE WARRANTS	ACCUMULATED DEFICIT	ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)	Total
Balance at Dec. 31, 2013	$ 154,457,878		$ (158,790,569)	$ 32,419	$ 595,539
Balance (in shares) at Dec. 31, 2013	40,110,661
Balance (purchase warrants in shares) at Dec. 31, 2013		983,071
Balance at Dec. 31, 2013		$ 4,895,811
Increase (Decrease) in Shareholders' Equity
Net Loss			(21,327,157)		(21,327,157)
Unrealized Gain (Loss) on Available-For-Sale Securities				(230,088)	(230,088)
Issuance of Common Shares	$ 71,136,487				$ 71,136,487
Issuance of Common Shares (in shares)	9,268,460				7,816,944
Exercise of Purchase Warrants	$ 13,329,138	$ (4,895,811)			$ 8,433,327
Exercise of Purchase Warrants (in shares)	904,886	(983,071)
Stock Option Based Expense	$ 4,597,412				4,597,412
Restricted Stock Amortization	5,497,274				5,497,274
Balance at Dec. 31, 2014	$ 249,018,189		(180,117,726)	(197,669)	$ 68,702,794
Balance (in shares) at Dec. 31, 2014	50,284,007				50,284,007
Increase (Decrease) in Shareholders' Equity
Net Loss			(14,420,450)		$ (14,420,450)
Unrealized Gain (Loss) on Available-For-Sale Securities				(717,827)	(717,827)
Issuance of Common Shares	$ 4,132,250				4,132,250
Issuance of Common Shares (in shares)	1,644,248
Stock Option Based Expense	$ 5,193,481				5,193,481
Stock Tendered in Satisfaction of Tax Liabilities	$ (4,264,922)				(4,264,922)
Stock Tendered in Satisfaction of Tax Liabilities (in shares)	(426,378)
Restricted Stock Amortization	$ 3,694,496				3,694,496
Balance at Dec. 31, 2015	$ 257,773,494		(194,538,176)	(915,496)	$ 62,319,822
Balance (in shares) at Dec. 31, 2015	51,501,877				51,501,877
Balance (purchase warrants in shares) at Dec. 31, 2015					0
Increase (Decrease) in Shareholders' Equity
Net Loss			(19,802,916)		$ (19,802,916)
Unrealized Gain (Loss) on Available-For-Sale Securities				13,619	13,619
Foreign currency rate changes				(671)	(671)
Issuance of Common Shares	$ 80,161				80,161
Issuance of Common Shares (in shares)	25,834
Stock Option Based Expense	$ 5,984,524				5,984,524
Restricted Stock Amortization	4,361,760				4,361,760
Balance at Dec. 31, 2016	$ 268,199,939		$ (214,341,092)	$ (902,548)	$ 52,956,299
Balance (in shares) at Dec. 31, 2016	51,527,711				51,527,711
Balance (purchase warrants in shares) at Dec. 31, 2016					0

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	12 Months Ended
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Cash Flows From Operating Activities:
Net (Loss)	$ (19,802,916)	$ (14,420,450)	$ (21,327,157)
Adjustments To Reconcile Net Loss To Net Cash Used In Operating Activities:
Depreciation and Amortization	762,368	822,294	996,321
Share Based Compensation- Employees	10,346,284	8,887,977	10,094,685
Restricted Stock Retained in Satisfaction of Tax Liabilities		(2,912,859)
Loss on Disposal of Assets	8,168	5,281	7,338
(Gain) on Sale of Investments Available for Sale	26,820	58,095	1,223
Amortization of Debt Issuance Costs			882,716
Non-cash Interest Expense			874,942
Changes in Assets and Liabilities:
(Increase) Decrease in Accounts Receivable	(1,162,469)	(574,731)	106,317
(Increase) in Inventory	(6,095,846)	(3,951,595)	(1,120,537)
(Increase) in Other Assets	(1,230,084)	(360,303)	(13,466)
Increase (Decrease) in Accounts Payable	1,863,018	(1,299,299)	(3,391,638)
Increase (Decrease) in Other Liabilities	191,134	(413,652)	(2,345,486)
Increase (decrease) Deferred License Revenue	(2,065,785)	(2,081,668)	19,492,520
Increase (decrease) in Deferred International Partnership Revenue	4,706,670
Changes in Assets and Liabilities	(3,793,362)	(8,681,248)	12,727,710
Cash (Used In) Operating Activities	(12,452,638)	(16,240,910)	4,257,778
Cash Flows From Investing Activities:
Purchase of Investments Available for Sale	(25,781,853)	(21,800,000)	(13,100,000)
Sale of Investments Available for Sale	24,491,677	1,468,656	4,976,000
Purchase of Equipment	(355,264)	(815,002)	(684,593)
Proceeds from Sale of Assets	1,000	4,800
Cash Provided by (Used In) Investing Activities	(1,644,440)	(21,141,546)	(8,808,593)
Cash Flows From Financing Activities:
Proceeds from the Issuance of Common Shares and Purchase Warrants	80,161	2,780,187	79,569,815
Payments on Notes Payable and Capital Lease Obligations			(21,100,000)
Cash Provided By Financing Activities	80,161	2,780,187	58,469,815
Effects of exchange rate changes	(671)
(Decrease) Increase In Cash	(14,017,588)	(34,602,269)	53,919,000
Cash At Beginning Of Period	31,198,182	65,800,451	11,881,451
Cash At End Of Period	17,180,594	$ 31,198,182	65,800,451
Supplemental Cash Flow Information:
Interest Paid			$ 3,518,168
Income Taxes Paid	$ 404,527

Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2016

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

Our consolidated financial statements include our accounts and the accounts for our wholly owned subsidiaries, Rockwell Transportation, Inc. and Rockwell Medical India Private Limited. Rockwell Medical India Private Limited was formed in 2016 for the purpose of conducting certain commercial activities in India.

All intercompany balances and transactions have been eliminated in consolidation.

Revenue Recognition

Our policy is to recognize revenue consistent with authoritative guidance for revenue recognition including the provisions of the Financial Accounting Standards Board Accounting Standards Codification. We recognize revenue when all of the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) delivery (or passage of title) has occurred or services have been rendered, (iii) the seller's price to the buyer is fixed or determinable, and (iv) collectability is reasonably assured.

Consistent with these guidelines we recognize revenue at the time we transfer title to our products to our customers which generally occurs when our products are delivered to our customer’s location consistent with our terms of sale. We recognize revenue for international shipments when title has transferred consistent with standard terms of sale.

We apply judgment as we analyze each element of our contractual agreements to determine appropriate revenue recognition. The terms of our contractual agreements may include milestone payments if specified research and development objectives are achieved, non-refundable licensing fees, milestone payments on sales or royalties from product sales.

When entering into an arrangement, we first determine whether the arrangement includes multiple deliverables and is subject to the accounting guidance in ASC subtopic 605-25, Multiple-Element Arrangements. If we determine that an arrangement includes multiple elements, we determine whether the arrangement should be divided into separate units of accounting and how the arrangement consideration should be measured and allocated among the separate units of accounting. An element qualifies as a separate unit of accounting when the delivered element has standalone value to the customer. Our arrangements do not include a general right of return relative to delivered elements. Any delivered elements that do not qualify as separate units of accounting are combined with other undelivered elements within the arrangement as a single unit of accounting. If the arrangement constitutes a single combined unit of accounting, we determine the revenue recognition method for the combined unit of accounting and recognize the revenue either on a straight-line basis or on a modified proportional performance method over the period from inception through the date the last deliverable within the single unit of accounting is delivered.

Non-refundable upfront license fees are recorded as deferred revenue and recognized into revenue over the estimated period of our substantive performance obligations. If we do not have substantive performance obligations, we recognize non-refundable upfront fees into revenue through the date the deliverable is satisfied. Analyzing the arrangement to identify deliverables requires the use of judgment and each deliverable may be an obligation to deliver services, a right or license to use an asset, or another performance obligation. In arrangements that include license rights and other non-contingent deliverables, such as participation in a steering committee, these deliverables do not have standalone value because the non-contingent deliverables are dependent on the license rights. That is, the non-contingent deliverables would not have value without the license rights, and only we can perform the related services. Upfront license rights and non-contingent deliverables, such as participation in a steering committee, do not have standalone value as they are not sold separately and they cannot be resold. In addition, when non-contingent deliverables are sold with upfront license rights, the license rights do not represent the culmination of a separate earnings process. As such, we account for the license and the non-contingent deliverables as a single combined unit of accounting. In such instances, the license revenue in the form of non-refundable upfront payments is deferred and recognized over the applicable relationship period.

For milestone payments based on sales and for royalties based on sales, we recognize revenue in the quarter that the information related to the sales becomes available and collectability is reasonably assured.

We recognize drug licensing fees over the term of the related license agreement. We received an upfront payment of $4 million pursuant to our License Agreement with Wanbang Biopharmaceutical Co., Ltd. (“Wanbang”), a subsidiary of Shanghai Fosun Pharmaceutical (Group) Co., Ltd. and we also recorded deferred drug license revenue related to a license for the Middle East in 2016 with ARAM Medical. Deferred drug license revenue for our drug license agreements is being recognized over the term of those license agreements and we recognized drug license revenue of $0.3 million in 2016.

The initial payment of $20 million received pursuant to our long-term Exclusive Distribution Agreement (the “Distribution Agreement”) with Baxter Healthcare Corporation (“Baxter”) in October 2014 has been accounted for as deferred license revenue. Deferred license revenue is being recognized based on the proportion of product shipments to Baxter in each period to total expected sales volume for the term of the agreement.

We recognize other revenues at the time the related fees and or payments are earned.

Shipping and Handling Revenue and Costs

Our products are generally priced on a delivered basis with the price of delivery included in the overall price of our products which is reported as sales. Separately identified freight and handling charges are also included in sales.

We include shipping and handling costs, including expenses of Rockwell Transportation, Inc., in cost of sales.

Cash and Cash Equivalents

We consider cash on hand, money market funds and unrestricted certificates of deposit with an original maturity of 90 days or less as cash and cash equivalents.

Investments Available for Sale

Investments Available for Sale are short-term investments, consisting principally of investments in short term duration bond funds, and are stated at fair value based upon observed market prices (Level 1 in the fair value hierarchy). Unrealized holding gains or losses on these securities are included in accumulated other comprehensive income (loss). Realized gains and losses, including declines in value judged to be other-than-temporary on available-for-sale securities are included as a component of other income or expense.

Management evaluates securities for other-than-temporary impairment (“OTTI”) on a quarterly basis, and more frequently when conditions warrant such an evaluation. When evaluating investment securities, consideration is given to the length of time and the extent to which the fair value has been less than cost, the financial condition and near-term prospects of the issuer, and whether the Company has the intent to sell the security or more likely than not will be required to sell the security before its anticipated recovery. The assessment of whether an OTTI exists involves a high degree of subjectivity and judgment and is based on the information available to management at a point in time.

Accounts Receivable

Accounts receivable are stated at invoice amounts. The carrying amount of trade accounts receivable is reduced by an allowance for doubtful accounts that reflects our best estimate of accounts that may not be collected. We review outstanding trade accounts receivable balances and based on our assessment of expected collections, we estimate the portion, if any, of the balance that may not be collected as well as a general valuation allowance for other accounts receivable based primarily on historical experience. All accounts or portions thereof deemed to be uncollectible are written off to the allowance for doubtful accounts.

Inventory

Inventory is stated at the lower of cost or net realizable value. Cost is determined on the first‑in first‑out (FIFO) method. Inventory that is not expected to be converted to cash over the next year is classified as non-current. Our policy is to reserve for our drug product inventory that we determine is unlikely to be sold to, or if sold, unlikely to be utilized by our customers on or before its expiration date.

Property and Equipment

Property and equipment are recorded at cost. Expenditures for normal maintenance and repairs are charged to expense as incurred. Property and equipment are depreciated using the straight‑line method over their useful lives, which range from three to ten years. Leasehold improvements are amortized using the straight‑line method over the shorter of their useful lives or the related lease term.

Licensing Fees

License fees related to the technology, intellectual property and marketing rights for Triferic covered under certain issued patents have been capitalized and are being amortized over the life of the related patents which is generally 17 years.

Goodwill, Intangible Assets and Long Lived Assets

The recorded amounts of goodwill and other intangibles from prior business combinations are based on management’s best estimates of the fair values of assets acquired and liabilities assumed at the date of acquisition. Goodwill is not amortized; however, it must be tested for impairment at least annually. Amortization continues to be recorded for other intangible assets with definite lives over their estimated useful lives. Intangible assets subject to amortization are reviewed for potential impairment whenever events or circumstances indicate that carrying amounts may not be recoverable.

An impairment review of goodwill, intangible assets, and property and equipment is performed annually or whenever a change in condition occurs which indicates that the carrying amounts of assets may not be recoverable. Such changes may include changes in our business strategies and plans, changes to our customer contracts, changes to our product lines and changes in our operating practices. We use a variety of factors to assess the realizable value of long‑lived assets depending on their nature and use.

The useful lives of other intangible assets are based on management’s best estimates of the period over which the assets are expected to contribute directly or indirectly to our future cash flows. Management annually evaluates the remaining useful lives of intangible assets with finite useful lives to determine whether events and circumstances warrant a revision to the remaining amortization periods. It is reasonably possible that management’s estimates of the carrying amount of goodwill and the remaining useful lives of other intangible assets may change in the near term.

Income Taxes

We account for income taxes in accordance with the provisions of ASC 740‑10, Income Taxes. A current tax liability or asset is recognized for the estimated taxes payable or refundable on tax returns for the year. Deferred tax liabilities or assets are recognized for the estimated future tax effects of temporary differences between book and tax accounting and operating loss and tax credit carryforwards. A valuation allowance is established for deferred tax assets if we determine it to be more likely than not that the deferred tax asset will not be realized.

The effects of tax positions are generally recognized in the financial statements consistent with amounts reflected in returns filed, or expected to be filed, with taxing authorities. For tax positions that the Company considers to be uncertain, current and deferred tax liabilities are recognized, or assets derecognized, when it is probable that an income tax liability has been incurred and the amount of the liability is reasonably estimable, or when it is probable that a tax benefit, such as a tax credit or loss carryforward, will be disallowed by a taxing authority. The amount of unrecognized tax benefits related to current tax positions is insignificant. The Company recognizes interest and penalties accrued related to unrecognized tax benefits as income tax expense.

Research and Product Development

We recognize research and product development costs as expenses as incurred. We incurred product development and research costs related to the commercial development, patent approval and regulatory approval of new products, including Triferic and for other indications of Triferic, aggregating approximately $5,840,000, $4,961,000 and $7,784,000 in 2016, 2015 and 2014, respectively.

Share Based Compensation

We measure the cost of employee services received in exchange for equity awards, including stock options, based on the grant date fair value of the awards in accordance with ASC 718‑10, Compensation — Stock Compensation. The cost of equity based compensation is recognized as compensation expense over the vesting period of the awards.

We estimate the fair value of compensation involving stock options utilizing the Black‑Scholes option pricing model. This model requires the input of several factors such as the expected option term, expected volatility of our stock price over the expected option term, and an expected forfeiture rate, and is subject to various assumptions. We believe the valuation methodology is appropriate for estimating the fair value of stock options we grant to employees and directors which are subject to ASC 718‑10 requirements. These amounts are estimates and thus may not be reflective of actual future results or amounts ultimately realized by recipients of these grants.

Employee Retirement Plans

We are the sponsor of a non‑contributory 401(k) Employee Savings Plan.

Earnings per Share

We compute our basic earnings (loss) per share using weighted average shares outstanding for each respective period. Diluted earnings per share also reflect the weighted average impact from the date of issuance of all potentially dilutive securities, consisting of stock options and common share purchase warrants, unless inclusion would have had an anti‑dilutive effect. Actual weighted average shares outstanding used in calculating basic and diluted earnings per share were:


	2016	2015	2014
Basic Weighted Average Shares Outstanding	50,676,180	50,068,129	41,404,999
Effect of Dilutive Securities	—	—	—
Diluted Weighted Average Shares Outstanding	50,676,180	50,068,129	41,404,999

For 2016, 2015 and 2014, the dilutive effect of stock options, unvested restricted share grants and common share purchase warrants have not been included in the average shares outstanding for the calculation of diluted loss per share as the effect would be anti-dilutive as a result of our net loss in these periods. The table below summarizes potentially dilutive securities.


	2016	2015	2014
Stock Options	7,691,501	7,759,002	6,885,083
Range of Exercise Prices of Stock Options	$3.09 - $11.49	$3.09 - $11.49	$3.09 - $10.20
Unvested Restricted Common Shares	850,000	850,000	740,000
Common Share Purchase Warrants	None	None	None
Range of Exercise Prices of Warrants	n/a	n/a	n/a

Other Comprehensive Income (Loss)

Accounting principles generally require that recognized revenue, expenses, gains, and losses be included in net income. Certain changes in assets and liabilities, however, such as unrealized gains and losses on available for sale securities, are reported as a direct adjustment to the equity section of the balance sheet. Such items, along with net income (loss), are considered components of comprehensive income (loss). Accumulated Other Comprehensive Income (Loss) consists almost entirely of unrealized gains and losses on available‑for‑sale investment securities. We also record foreign currency translation adjustments to Other Comprehensive Income (Loss). However, such amounts were insignificant in 2016.

Estimates in Preparation of Financial Statements

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the period. Actual results could differ from those estimates.

New Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606), which will supersede the current revenue recognition requirements in Topic 605, Revenue Recognition. The standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The new guidance initially was effective for years beginning January 1, 2017, but on July 9, 2015 the FASB deferred the effective date and, as a result, the new guidance is effective for the year beginning January 1, 2018. The standard permits the use of either the retrospective or cumulative effect transition method. The Company is in the process of evaluating how the new revenue recognition standard could impact the financial statements and disclosures. For the majority of our sales transactions, the new standard is not expected to significantly change the timing of revenue recognition; however, we are still analyzing our licensing arrangements to determine the impact of the new standard. The new standard will also require expanded disclosures surrounding revenue in the notes to the financial statements.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The amendments in this ASU revise the accounting related to lessee accounting. Under the new guidance, lessees will be required to recognize a lease liability and a right-of-use asset for all leases. The amendments in this ASU are effective for the Company beginning on January 1, 2019 and should be applied through a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. Early adoption is permitted. We anticipate this standard will have a material impact on our consolidated balance sheets. However, we do not believe adoption will have a material impact on our consolidated income statements. Upon implementation, the Company's lease payment obligations will be recognized at their estimated present value along with a corresponding right-of-use asset. Lease expense recognition will be generally consistent with current practice.

In July 2015, the FASB issued ASU 2015-11, Inventory (Topic 330) Related to Simplifying the Measurement of Inventory, which applies to all inventory except inventory that is measured using last-in, first-out (LIFO) or the retail inventory method. Inventory measured using first-in, first-out (FIFO) or average cost is covered by the new guidance and should be measured at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The amendments will be applied prospectively for fiscal years beginning after December 15, 2016. The Company does not expect a significant change upon implementation as cost is expected to be lower than net realizable value.

FAIR MARKET VALUE MEASUREMENTS

12 Months Ended

Dec. 31, 2016

FAIR MARKET VALUE MEASUREMENTS

FAIR MARKET VALUE MEASUREMENTS

3. FAIR MARKET VALUE MEASUREMENTS

Accounting standards require certain assets and liabilities be reported at fair value in the financial statements and provides a framework for establishing that fair value. The framework for determining fair value is based on a hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below:

Level 1:	Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.
Level 2:	Observable prices that are based on inputs not quoted in active markets, but corroborated by market data.
Level 3:	Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs.

In determining fair value, we utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as considering counterparty credit risk in its assessment of fair value. The following methods, assumptions, and valuation techniques were used to measure different financial assets and liabilities at fair value and in estimating its fair value disclosures for financial instruments.

Cash and Cash Equivalents: The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents are deemed to approximate fair value

Investment Securities: Fair values for investment securities are determined by quoted market prices if available.

Accounts Receivable, Accounts Payable and Accrued Liabilities: The fair value of trade receivables and payables approximate their carrying amounts due to the short duration before collection or payment.

Based on the foregoing methods and assumptions, the carrying value and fair value of the Company’s financial instruments other than trade receivables and payables are as follows (in thousands):


	Carrying
	value		Fair value		Level 1		Level 2		Level 3
As of December 31, 2016
Financial assets
Cash and cash equivalents	$	17,181	$	17,181	$	17,181	$	—	$	—
Investment securities available for sale		40,760		40,760		40,760		—		—
As of December 31, 2015
Financial assets
Cash and cash equivalents	$	31,198	$	31,198	$	31,198	$	—	$	—
Investment securities available for sale		39,483		39,483		39,483		—		—

The Company also has certain non‑financial assets that under certain conditions are subject to measurement at fair value on a non‑recurring basis. No such measurements were required in 2016 or 2015.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Distribution Agreement	12 Months Ended
Distribution Agreement	Dec. 31, 2016
DISTRIBUTION AGREEMENT.
DISTRIBUTION AGREEMENT	6. DISTRIBUTION AGREEMENT As of October 2, 2014, we entered into the Distribution Agreement with Baxter, pursuant to which Baxter became the Company’s exclusive agent for sales, marketing and distribution activities for the Company’s hemodialysis concentrate and ancillary products in the United States and various foreign countries for an initial term of 10 years. The Distribution Agreement does not include any of the Company’s drug products. The Company will retain sales, marketing and distribution rights for its hemodialysis concentrate products in specified foreign countries in which the Company has an established commercial presence. During the term of the Distribution Agreement, Baxter has agreed not to manufacture or sell any competitive concentrate products in the United States hemodialysis market, other than specified products. Pursuant to the Distribution Agreement, Baxter paid the Company $20 million in cash in October 2014 (the “Upfront Fee”). The Upfront Fee has been deferred and is being recognized as revenue based on the proportion of product shipments to Baxter in each period to total expected sales volume over the term of the Distribution Agreement. The Company recognized revenue associated with the Upfront Fee totaling $2,065,785 for the year ended December 31, 2016, $2,081,668 for the year ended December 31, 2015 and $507,480 for the year ended December 31, 2014. Under the Distribution Agreement, Baxter purchases products from the Company at established gross margin-based prices per unit, adjusted each year during the term. The Company continues to manage customer service, transportation and certain other functions for its current customers on Baxter’s behalf through at least December 31, 2017, in exchange for which Baxter will pay the Company an amount equal to the Company’s related costs to provide such functions plus a slight mark-up. The Distribution Agreement also requires Baxter to meet minimum annual gallon-equivalent purchase levels, subject to a cure period and certain other relief, in order to maintain its exclusive distribution rights. The minimum purchase levels increase each year over the term of the Distribution Agreement. Orders in any contract year that exceed the minimum will be carried forward and applied to future years’ minimum requirements. The Distribution Agreement also contains provisions governing the operating relationship between the parties, the Company’s obligations to maintain specified manufacturing capacity and quality levels, remedies, as well as representations, warranties and indemnification obligations of the parties. Either party may terminate the Distribution Agreement upon the insolvency or material breach of the other party or in the event of a force majeure. In addition, Baxter may also terminate the Distribution Agreement at any time upon 270 days’ prior written notice to the Company or if (1) prices increase beyond certain thresholds and notice is provided within 45 days after the true up payment is due for the year in which the price threshold is exceeded, (2) a change of control of the Company occurs and 270 days’ notice is provided, or (3) upon written notice that Baxter has been enjoined by a court of competent jurisdiction from selling in the United States any product covered by the Distribution Agreement due to a claim of intellectual property infringement or misappropriation relating to such product. If Baxter terminates the Distribution Agreement under the discretionary termination or the price increase provisions, it would be subject to a limited non-compete obligation in the United States with respect to certain products for a period of two years. If a “Refund Trigger Event” occurs, the Company would be obligated to repay a portion of the Upfront Fee and Facility Fee (described below) as follows: 50% if the event occurs prior to December 31, 2016, 33% if the event occurs in 2017 or 2018, and 25% if the event occurs in 2019, 2020 or 2021. A “Refund Trigger Event” means any of the following: (1) a change of control of the Company involving any of certain specified companies; (2) a termination by Baxter due to the Company’s bankruptcy or breach, or due to price increases that exceed the stated thresholds; (3) a termination by either party due to a force majeure; (4) settlement or adjudication of any claim, action or litigation relating to a covered product that materially and adversely affects Baxter’s commercialization of the product; and (5) any regulatory action or ruling relating to a covered product that materially and adversely affects Baxter’s commercialization of the product. In addition, if Baxter terminates the Distribution Agreement because Baxter has been enjoined by a court of competent jurisdiction from selling in the United States any product covered by the Distribution Agreement due to a claim of intellectual property infringement or misappropriation relating to such product prior to the end of 2018, Baxter would be entitled to a refund of up to $10 million, or $6.6 million if the termination occurs in 2019. In no event would Baxter be entitled to more than one refund payment The Distribution Agreement also required the Company to prepay its outstanding secured long-term indebtedness within 180 days and prohibits the Company from entering into a subsequent contract encumbering the assets used in the Company’s concentrate business without the prior written consent of Baxter. Baxter has also agreed to pay the Company up to $10 million (the “West Coast Facility Fee”) to build and operate a new manufacturing facility located in the Pacific time zone to service customers in the Western United States. The West Coast Facility Fee will be reduced to the extent that the facility is not operational within 12 months after the start of construction. Except for any leased components, the Company will own the facility when completed. The Distribution Agreement may be extended an additional five years by Baxter if Baxter achieves a specified sales target and pays an extension fee of $7.5 million. If the first extension occurs, the Distribution Agreement term may later be extended an additional five years at Baxter’s option at no additional cost. On September 12, 2016, Baxter initiated an arbitration proceeding against Rockwell under the Distribution Agreement. Baxter alleges that Rockwell has breached the Distribution Agreement in various respects associated with its dealings with customers, its allocation of expenses and its true-up notices, and by improperly threatening to build a West Coast facility. Baxter seeks declaratory relief giving Baxter the right to terminate the Distribution Agreement and recover up to $10 million of the upfront fee, injunctive relief to prevent Rockwell from establishing a West Coast facility, and unspecified damages. Rockwell filed a response denying all of Baxter’s claims of breach and wrongdoing, and has counterclaimed that Baxter is itself in breach of the Distribution Agreement for failing to pay substantial accounts receivable and for repudiating its obligation to pay the West Coast facility fee of up to $10 million. Rockwell is seeking damages, declaratory, injunctive and other equitable relief, as well as interest, costs and attorney fees. In addition, in October 2016, Rockwell gave notice to Baxter that it breached the minimum purchase requirement for the contract year ended October 2, 2016 and that we intended to cause its distribution rights to become non-exclusive unless it cured the shortfall within the 30-day period specified in the Distribution Agreement. Baxter disputed the existence of a breach and failed to cure the deficiency. Rockwell subsequently provided Baxter with notice of loss of exclusivity due to its failure to cure as provided in the Distribution Agreement. The determination of whether a breach occurred resulting in a loss of exclusivity and the outcome of the other pending disputes with Baxter will be determined through the arbitration process.

PROPERTY AND EQUIPMENT

12 Months Ended

Dec. 31, 2016

PROPERTY AND EQUIPMENT

PROPERTY AND EQUIPMENT

8. PROPERTY AND EQUIPMENT

Major classes of property and equipment, stated at cost, as of December 31, 2016 and 2015 are as follows:


	2016		2015
Leasehold Improvements	$	728,151	$	682,992
Machinery and Equipment		7,169,223		7,042,836
Information Technology & Office Equipment		2,293,587		2,273,289
Laboratory Equipment		610,767		668,607
Transportation Equipment		265,198		273,109
		11,066,926		10,940,833
Accumulated Depreciation		(9,675,351)		(9,294,265)
Net Property and Equipment	$	1,391,575	$	1,646,568

Below is a summary of depreciation expense by period:


	2016		2015		2014
Depreciation expense	$	601,093	$	655,265	$	829,292

GOODWILL AND INTANGIBLE ASSETS

12 Months Ended

Dec. 31, 2016

GOODWILL AND INTANGIBLE ASSETS

GOODWILL AND INTANGIBLE ASSETS

9. GOODWILL AND INTANGIBLE ASSETS

Total goodwill was $920,745 at December 31, 2016 and 2015. We completed our annual impairment tests as of November 30, 2016 and 2015, and determined that no adjustment for impairment of goodwill was required.

We have entered into a global licensing agreement for certain patents covering Triferic, a therapeutic drug compound to be delivered using our dialysate product lines. We received FDA approval for this product in January 2015. We have capitalized the licensing fees paid for the rights to use this patented technology as an intangible asset. We have capitalized certain patent approval costs.

During 2011, we acquired an abbreviated new drug application (“ANDA”) for a generic version of an intravenous vitamin‑D analogue, Calcitriol. Total capitalized costs related to this ANDA were approximately $695,000. These were amortized over a five year period ending December 31, 2016.


	2016		2015		2014
Capitalized Licensing Fees	$	1,070,126	$	1,070,126	$	1,070,126
Accumulated Amortization		(1,065,744)		(904,469)		(737,440)
Capitalized Licensing Fees, Net of Amortization	$	4,382	$	165,657	$	332,686
Amortization Expense	$	161,275	$	167,029	$	167,029

Our policy is to amortize licensing fees over the life of the patents pertaining to certain licensing agreements and to amortize patent costs over the life of the patent. Estimated amortization expense for amortization of capitalized patent costs in 2017 is approximately $353. In 2015, we recognized expenses related to milestone achievements of $275,000.

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

+ References + Details

INCOME TAXES

12 Months Ended

Dec. 31, 2016

INCOME TAXES

INCOME TAXES

12. INCOME TAXES

A reconciliation of income tax expense at the statutory rate to income tax expense at our effective tax rate is as follows:


	2016		2015		2014
Tax Expense (Benefit) Computed at 34 % of Pretax Income (Loss)	$	(6,595,452)	$	(4,903,000)	$	(7,251,000)
Foreign Income Tax Expense		(404,527)		—		—
Effect of Change in Valuation Allowance		(6,595,452)		(4,903,000)		(7,251,000)
Total Income Tax Expense	$	404,527	$	—	$	—

The details of the net deferred tax asset are as follows:


	December 31,
	2016		2015
Deferred tax assets:
Net Operating Loss Carryforward	$	51,463,000	$	52,669,000
Stock Based Compensation		7,704,000		4,223,000
Deferred Revenue		6,478,000		5,920,000
General Business Credit		6,146,000		5,741,000
Accrued Expenses		605,000		511,000
Inventories		494,000		163,000
Book over Tax Depreciation		61,000		47,000
Allowance for Doubtful Accounts		2,000		26,000
Total Deferred Tax Assets		72,953,000		69,300,000
Deferred Tax Liabilities:
Goodwill & Intangible Assets		137,000		167,000
Prepaid Expenses		182,000		119,000
Total Deferred Tax Liabilities		319,000		286,000
Subtotal		72,634,000		69,014,000
Valuation Allowance		(72,634,000)		(69,014,000)
Net Deferred Tax Asset	$	—	$	—

Deferred tax assets result primarily from net operating loss carryforwards. For tax purposes, we have net operating loss carryforwards of approximately $151,400,000 that expire between 2018 and 2036.

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 be realized upon the generation of future taxable income during the periods in which those temporary differences become deductible. We recognized $404,527 in foreign income taxes paid for the year ended December 31, 2016. We recognized no income tax expense or benefit for the years ended December 31, 2015 and 2014. While we anticipate generating income within the next year or two, we expect to incur operating losses until our drug products are marketed and generating sufficient profits to offset our operating expenses. Considered together with our limited history of operating income and our net losses in 2016, 2015 and 2014, management has placed a full valuation allowance against the net deferred tax assets as of December 31, 2016 and 2015. The portion of the valuation allowance resulting from excess tax benefits on share based compensation that would be credited directly to contributed capital if recognized in subsequent periods is $5.4 million.

The Company accounts for its uncertain tax positions in accordance with ASC 740‑10, Income Taxes and the amount of unrecognized tax benefits related to tax positions is not significant at December 31, 2016 and 2015.

CAPITAL STOCK

12 Months Ended

Dec. 31, 2016

CAPITAL STOCK

CAPITAL STOCK

13. CAPITAL STOCK

Our authorized capital stock consists of 2,000,000 preferred shares, none of which were issued or outstanding at December 31, 2016, 2015 and 2014, and 120,000,000 common shares, no par value per share, of which the following shares were outstanding:


	2016		2015		2014
Shares outstanding as of December 31,		51,527,711		51,501,877		50,284,007
Summary of Share Issuances:
Share Issuances related to Equity Compensation:
Shares issued upon exercise of stock options by employees		25,834		657,998		711,516
Proceeds realized from stock option exercises	$	80,161	$	2,780,188	$	2,964,445
Average exercise price of options exercised	$	3.10	$	4.23	$	4.17
Restricted Stock Grants		—		850,000		740,000
Share issuances related to Warrant Exercises
Shares issued upon the exercise of warrants		—				904,886
Proceeds realized from warrant exercises		—			$	8,433,045
Share issuances related to Equity Offerings
Shares issued pursuant to equity offerings		—				7,816,944
Proceeds realized from equity offerings		—			$	69,780,967

Common Shares

Holders of the common shares are entitled to one vote per share on all matters submitted to a vote of our shareholders and are entitled to receive dividends when and if declared by the Board of Directors. The Board is authorized to issue additional common shares within the limits of the Company’s Articles of Incorporation without further shareholder action, subject to applicable stock exchange rules.

Warrants

As of December 31, 2016 and 2015, we had no outstanding warrants. During 2014, we realized $8,433,045 in net proceeds from the exercise of 904,886 warrants at an average exercise price of $9.32.

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 310
-SubTopic 10
-Section S99
-Paragraph 4
-Subparagraph (SAB Topic 4.E)
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Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
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-Section 50
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Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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-Section S99
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-Subparagraph (SX 210.5-02(29))
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Reference 4: http://www.xbrl.org/2003/role/presentationRef
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Reference 5: http://www.xbrl.org/2003/role/presentationRef
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Reference 6: http://www.xbrl.org/2003/role/presentationRef
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-SubTopic 10
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-Paragraph 1
-Subparagraph (SX 210.5-02(31))
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Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
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-Section S99
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Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
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-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(30))
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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-SubTopic 10
-Section 50
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-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21506-112644

Reference 10: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
-Topic 235
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-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(d))
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Reference 11: http://www.xbrl.org/2003/role/presentationRef
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Reference 12: http://www.xbrl.org/2003/role/presentationRef
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Reference 13: http://www.xbrl.org/2003/role/presentationRef
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Reference 14: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=6521494

Reference 15: http://www.xbrl.org/2003/role/presentationRef
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+ Details

LONG TERM INCENTIVE PLAN & STOCK OPTIONS

12 Months Ended

Dec. 31, 2016

LONG TERM INCENTIVE PLAN & STOCK OPTIONS

LONG TERM INCENTIVE PLAN & STOCK OPTIONS

14. LONG TERM INCENTIVE PLAN & STOCK OPTIONS

Long Term Incentive Plan & Stock Options

The Board of Directors adopted the Rockwell Medical, Inc., 2007 Long Term Incentive Plan (“LTIP”) on April 11, 2007 as a replacement for the 1997 Stock Option Plan (the “Old Plan”) which was terminated as to future grants. No options were granted under the Old Plan after 2006 and no options remain outstanding as of December 31, 2016. There are 11,500,000 common shares reserved for issuance under the LTIP. The Compensation Committee of the Board of Directors (the “Committee”) is responsible for the administration of the LTIP including the grant of stock based awards and other financial incentives including performance based incentives to employees, non‑employee directors and consultants.

The Committee determines the terms and conditions of options and other equity based incentives including, but not limited to, the number of shares, the exercise price, term of option and vesting requirements. The Committee approved stock option grants during 2016, 2015 and 2014 and restricted stock grants in 2015 and 2014. The stock option awards were granted with an exercise price equal to the market price of the Company’s stock on the date of the grant. The options expire 10 years from the date of grant or upon termination of employment and generally vest in three equal annual installments beginning on the first anniversary of the date of grant.

Restricted Stock Grants

There were no grants of restricted stock during 2016. We granted 850,000 and 740,000 restricted shares in 2015 and 2014, respectively under the LTIP. These restricted stock grants were valued at the market price on the date of grant.

During 2015, restricted stock grants aggregating 850,000 common shares were granted in October 2015 with a vesting date of approximately twenty months following the grant date. Vesting is conditioned upon continued employment with the Company.

During 2014, restricted stock grants aggregating 320,000 shares were granted in January 2014 with a vesting date of approximately fourteen months after the grant date and an additional 420,000 common shares were granted in October 2014 with a vesting date of approximately seven months following the grant date with vesting conditioned upon continued employment with the Company.


	2016		2015		2014
Restricted Shares Granted		-		850,000		740,000
Average Market Value Per Share on Grant Date		-	$	8.23	$	9.42
Expense related to All Restricted Shares	$	4,361,760	$	3,694,496	$	5,497,274
Unearned Stock Based Compensation for All Restricted Stock Awards Attributable to Future Periods.	$	1,549,259

Stock Option Grants

Our standard stock option agreement under the 2007 Plan allows for the payment of the exercise price of vested stock options either through cash remittance in exchange for newly issued shares, or through non‑cash exchange of previously issued shares held by the recipient for at least six months in exchange for our newly issued shares. The 1997 Plan also allows for the retention of shares in payment of the exercise price and income tax withholding. The latter method results in no cash being received by us, but also results in a lower number of total shares being outstanding subsequently as a direct result of this exchange of shares. Shares returned to us in this manner would be retired.

In 2016, 2015 and 2014, the Company received cash proceeds of $80,161, $2,780,188 and $2,964,445 respectively, in exchange for shares issued upon the exercise of options during the year. No income tax benefits were recognized during 2016, 2015 and 2014 related to stock option activity as the Company has a full valuation allowance recorded against its deferred tax assets. However, tax benefits (expense) for the excess of the value of the shares issued over the price paid of $20,000, ($943,000) and $2,009,000 were created in 2016, 2015, and 2014. The cumulative excess tax benefit at December 31, 2016 is $5.4 million, which when realized, will be credited directly to shareholders' equity.

A summary of the status of the LTIP and the Old Plan is as follows:


		WEIGHTED
		AVERAGE	AGGREGATE
		EXERCISE	INTRINSIC
	SHARES	PRICE	VALUE
Outstanding at December 31, 2013	6,228,000	6.27	$	25,956,880
Granted	1,731,500	9.43
Exercised	(1,029,016)	2.88	$	2,964,445
Forfeited	(45,401)	6.19
Outstanding at December 31, 2014	6,885,083	7.41	$	19,730,211
Granted	1,697,500	8.30
Exercised	(794,248)	3.50	$	2,780,188
Forfeited	(29,333)	6.91
Outstanding at December 31, 2015	7,759,002	7.84	$	18,648,477
Granted	30,000	6.54
Exercised	(25,834)	4.35	$	112,280
Forfeited	(71,667)	9.33
Outstanding at December 31, 2016	7,691,501	7.83	$	1,821,384


OPTIONS OUTSTANDING						OPTIONS EXERCISABLE
								WEIGHTED
			REMAINING	WEIGHTED				AVERAGE
	NUMBER OF		CONTRACTUAL	EXERCISE		NUMBER OF		EXERCISE
RANGE OF EXERCISE PRICES	OPTIONS		LIFE	PRICE		OPTIONS		PRICE
$3.09 to $4.93		392,500	2.0-6.5 yrs.	$	3.31		392,500	$	3.31
$5.86 to $7.13		2,513,000	.9-9.7 yrs.	$	6.44		2,483,000	$	6.44
$8.23 to 11.49		4,786,001	2.8-8.8 yrs.	$	8.94		3,113,835	$	9.09
Total		7,691,501	5.7 yrs.	$	7.83		5,989,335	$	7.61
Intrinsic Value	$	1,821,384				$	1,821,134


		WEIGHTED
		AVERAGE
	NUMBER OF	FAIR MARKET
	UNVESTED	VALUE AT
	OPTIONS	GRANT DATE
As of December 31, 2013	1,714,433
Granted	1,731,500	$	5.91
Forfeited	(45,401)
Vested	(820,032)
As of December 31, 2014	2,580,500
Granted	1,697,500	$	4.56
Forfeited	(28,333)
Vested	(1,135,056)
As of December 31, 2015	3,114,611
Granted	30,000	$	3.85
Forfeited	(71,667)
Vested	(1,370,778)
As of December 31, 2016	1,702,166

The Company values stock options awarded using the Black‑Scholes method. Assumptions used in the stock option valuations were:


	2016	2015	2014
Volatility of share price	64 - 65 %	58 - 61 %	69 - 70 %
Risk free interest rate	1.3-1.6 %	1.5 - 1.7 %	1.9 - 2.0 %
Expected option life	6 yrs.	6 yrs.	6 yrs.
Dividend Yield	0.0%	0.0%	0.0%

We believe this valuation methodology is appropriate for estimating the fair value of stock options we grant to employees and directors which are subject to ASC 718‑10 requirements. We primarily base our determination of expected volatility through our assessment of the historical volatility of our common shares. We do not believe that we are able to rely on our historical stock option exercise and post‑vested termination activity to provide accurate data for estimating our expected term for use in determining the fair value of these options. Therefore, as allowed by Staff Accounting Bulletin (SAB) No. 107, Share‑Based Payment, we have opted to use the simplified method for estimating the expected option term equal to the midpoint between the vesting period and the contractual term. The contractual term of the option is 10 years from the date of grant and the vesting term of the option is three years from date of grant. Risk free interest rates utilized are based upon published U.S. Treasury yield curves at the date of the grant for the expected option term.

For the years ended December 31, 2016, 2015 and 2014, we recognized compensation expense of $5,984,524, $5,193,481 and $4,597,412 respectively related to options granted to employees under the LTIP with a corresponding credit to common stock. At December 31, 2016, the amount of unrecorded stock-based compensation expense for stock options attributable to future periods was approximately $5,834,369 which is expected to be amortized to expense over the remaining vesting periods of the options of 1 to 30 months.

As of December 31, 2016, the remaining number of common shares available for equity awards under the LTIP was 545,694.

- Definition

The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details.

+ References + Details

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($)	Dec. 31, 2016	Dec. 31, 2015
CONSOLIDATED BALANCE SHEETS
Allowance for reserve, accounts receivable (in dollars)	$ 5,000	$ 75,000
Common Shares, par value (in dollars per share)	$ 0	$ 0
Common Shares, shares issued	51,527,711	51,501,877
Common Shares, shares outstanding	51,527,711	51,501,877

Description of Business	12 Months Ended
Description of Business	Dec. 31, 2016
Description of Business
Description of Business	1. DESCRIPTION OF BUSINESS Rockwell Medical, Inc. and Subsidiaries (collectively, “we”, “our”, “us”, or the “Company”) is a fully-integrated pharmaceutical company targeting end-stage renal disease and chronic kidney disease with innovative products for the treatment of iron deficiency, secondary hyperparathyroidism and hemodialysis. We are also an established manufacturer and leader in delivering high-quality hemodialysis concentrates/dialysates to dialysis providers and distributors in the United States and abroad. We are currently developing unique, proprietary renal drug therapies. These novel renal drug therapies support disease management initiatives to improve the quality of life and care of dialysis patients and are designed to deliver safe and effective therapy, while decreasing drug administration costs and improving patient convenience and outcome. We have obtained global licenses for certain dialysis related drugs which we are developing and planning to market. We manufacture, sell and distribute hemodialysis concentrates and other ancillary medical products and supplies used in the treatment of patients with End Stage Renal Disease, or “ESRD”. We supply our products to dialysis providers and distributors who treat patients with kidney disease. Our concentrate products are used to remove waste and replace needed nutrients in the blood of dialysis patients during their hemodialysis treatment. We primarily sell our products in the United States. We are regulated by the Federal Food and Drug Administration (“FDA”) under the Federal Drug and Cosmetics Act, as well as by other federal, state and local agencies. We hold several FDA product approvals including both drugs and medical devices.

INVESTMENTS IN AVAILABLE FOR SALE SECURITIES	12 Months Ended
INVESTMENTS IN AVAILABLE FOR SALE SECURITIES	Dec. 31, 2016
INVESTMENTS IN AVAILABLE FOR SALE SECURITIES
INVESTMENTS IN AVAILABLE FOR SALE SECURITIES	4. INVESTMENTS IN AVAILABLE FOR SALE SECURITIES As of December 31, 2016, we held investments in available for sale securities in several short term bond funds. These funds generally held high credit quality short term debt instruments. These debt instruments were subject to changes in fair market value due to changes in interest rates. The market value of these investments was $40,759,703 as of December 31, 2016. In 2016, we purchased securities with a market value of $25,781,853 and had unrealized losses of $901,877 as of December 31, 2016. In 2016, we sold securities with a market value of $24,491,677 with an average cost basis of $24,518,497. We had realized gains of $156,461 and realized losses of $183,281. As of December 31, 2015, we held investments in available for sale securities in several short term bond funds. These funds generally held high credit quality short term debt instruments. These debt instruments were subject to changes in fair market value due to changes in interest rates. As of December 31, 2015, the market value of investments in available for sale securities was $39,482,732. In 2015, we purchased securities with a market value of $21,800,000 and had unrealized gains of $69,877 and unrealized losses of $985,374 as of December 31, 2015. In 2015, we sold securities with a market value of $1,469,000 with an average cost basis of $1,527,095. We realized losses of $58,095 from sales of available for sale securities.

SIGNIFICANT MARKET SEGMENTS AND CUSTOMERS	12 Months Ended
SIGNIFICANT MARKET SEGMENTS AND CUSTOMERS	Dec. 31, 2016
SIGNIFICANT MARKET SEGMENTS
SIGNIFICANT MARKET SEGMENTS AND CUSTOMERS	5. SIGNIFICANT MARKET SEGMENTS AND CUSTOMERS We operate in one market segment, the hemodialysis market, which involves the manufacture, sale and distribution of hemodialysis products to hemodialysis clinics including pharmaceutical, dialysis concentrates, dialysis kits and other ancillary products used in the dialysis process. In October 2014, we entered into the Distribution Agreement with Baxter pursuant to which Baxter received exclusive distribution rights for our concentrate products in the United States. Rockwell domestic customer contracts for the supply of dialysis concentrate products that permitted assignment to Baxter without consent have been assigned to Baxter. As a result, for the years ended December 31, 2016 and 2015, our direct sales to Baxter aggregated approximately 24% and 28% of sales, respectively and we had a receivable from Baxter of $2,430,159 and $2,088,000 as of December 31, 2016 and 2015, respectively. For the years ended December 31, 2016, 2015 and 2014, one customer, DaVita Healthcare Partners, Inc., accounted for 52% of our sales in 2016, 48% of our sales in 2015 and 49% of our sales in 2014. Our accounts receivable from this customer were $2,224,046 and $2,156,000 as of December 31, 2016 and 2015, respectively. DaVita and Baxter and the accounts administered by Baxter are important to our business, financial condition and results of operations. The loss of any significant accounts could have a material adverse effect on our business, financial condition and results of operations. No other customers accounted for more than 10% of our sales in any of the last three years. The majority of our international sales in each of the last three years were sales to domestic distributors that were resold to end users outside the United States. Our sales to foreign customers and distributors were less than 5% of our total sales in 2016, 2015 and 2014. Our total international sales, including sales to domestic distributors for resale outside the United States, aggregated 12%, 13% and 13%, of overall sales in 2016, 2015 and 2014, respectively.

RISK MANAGEMENT	12 Months Ended
RISK MANAGEMENT	Dec. 31, 2016
RISK MANAGEMENT
RISK MANAGEMENT	15. RISK MANAGEMENT Insurance We evaluate various kinds of risk that we are exposed to in our business. In our evaluation of risk, we evaluate options and alternatives to mitigating such risks. For certain insurable risks we may acquire insurance policies to protect against potential losses or to partially insure against certain risks. For our subsidiary, Rockwell Transportation, Inc., we maintain a partially uninsured workers' compensation plan. Under the policy, the Company's self‑insurance retention is $350,000 per occurrence and $580,388 in aggregate coverage for the policy year ending July 1, 2017. The total amount at December 31, 2016 by which retention limits exceed the claims paid and accrued is approximately $298,000 for the policy year ending July 1, 2017. Estimated additional future claims subject to payment by the Company of approximately $196,537 have been accrued for the year ended December 31, 2016. At December 31, 2016, approximately $300,000 was held in cash collateral and escrow by the insurance carrier for workers’ compensation insurance. At December 31, 2016 amounts held in cash collateral and escrow are included in prepaid expenses and other non-current assets in the consolidated financial statements.