Note 12 - Concentrations
|9 Months Ended|
Sep. 30, 2020
|Notes to Financial Statements|
|Concentration Risk Disclosure [Text Block]||
Milestone Scientific has informal arrangements with
third-party manufacturers of the STA, epidural, and intra-articular devices, pursuant to which they manufacture these products under specific purchase orders but without any long-term contract or minimum purchase commitment. Consequently, advances on contracts have been classified as current on
September 30, 2020and
December 31, 2019.The termination of the manufacturing relationship with any of these manufacturers could have a material adverse effect on Milestone Scientific's ability to produce and sell its products. Although alternate sources of supply exist, and new manufacturing relationships could be established, Milestone Scientific would need to recover its existing tools or have new tools produced. Establishment of new manufacturing relationships could involve significant expense and delay. Any curtailment or interruption of the supply, because of termination of such a relationship, would have a material adverse effect on Milestone Scientific's financial condition, business, and results of operations.
September 30, 2020,approximately
45%of the Company's net product sales were from the Company's exclusive domestic dental distributor, respectively. For the
September 30, 2019net product sales were
51%,respectively, to the Company's exclusive domestic dental distributor. Accounts receivable for
twocustomers/distributors amounted to approximately
of Milestone Scientific's gross accounts receivable as of
September 30, 2020,
oneof which was the Company's exclusive domestic dental distributor. Accounts receivable for the Company's exclusive domestic dental distributor amounted to approximately or
77%,of Milestone Scientific's gross accounts receivable as of
December 31, 2019.The Company's exclusive domestic dental distributor exclusivity for the domestic dental market is subject to annual purchase requirements and other requirements, as defined in the agreement.
19pandemic affected the Company's operations in the
maycontinue to do so indefinitely thereafter. The Company is continuously monitoring its own operations and intends to take appropriate actions to mitigate the risks arising from the COVID-
19pandemic to the best of its abilities, but there can be
noassurances that the Company will be successful in doing so. To the extent the Company is able to obtain information about and maintain communications with its customers, suppliers, vendors, and other business partners, the Company will seek to minimize disruptions to its supply chain and distribution channels, but many circumstances will be beyond the Company's control. Governmental action
mayfurther cause the Company to temporarily close its facilities and/or regional quarantines
mayresult in labor shortages and work stoppages. All of these factors
mayhave far reaching direct and indirect impacts on the Company's business, operations, and financial results and condition. The ultimate extent of the effects of the COVID-
19pandemic on the Company is highly uncertain and will depend on future developments which cannot be predicted.
The entire disclosure for any concentrations existing at the date of the financial statements that make an entity vulnerable to a reasonably possible, near-term, severe impact. This disclosure informs financial statement users about the general nature of the risk associated with the concentration, and may indicate the percentage of concentration risk as of the balance sheet date.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef