DOCUMENT AND ENTITY INFORMATION
DOCUMENT AND ENTITY INFORMATION - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Feb. 20, 2020 | Jun. 30, 2019 | |
DOCUMENT AND ENTITY INFORMATION | |||
Entity Registrant Name | RIGEL PHARMACEUTICALS INC | ||
Entity Central Index Key | 0001034842 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2019 | ||
Amendment Flag | false | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | 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 | $ 437,415,634 | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 168,569,525 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY |
BALANCE SHEETS
BALANCE SHEETS - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 22,521,000 | $ 76,322,000 |
Short-term investments | 75,557,000 | 52,215,000 |
Accounts receivable, net | 10,111,000 | 4,077,000 |
Inventories | 1,354,000 | 894,000 |
Prepaid and other current assets | 9,462,000 | 3,479,000 |
Total current assets | 119,005,000 | 136,987,000 |
Property and equipment, net | 2,159,000 | 1,387,000 |
Operating lease right-of-use asset | 25,709,000 | |
Other assets | 696,000 | 735,000 |
Total assets | 147,569,000 | 139,109,000 |
Current liabilities: | ||
Accounts payable | 4,152,000 | 6,391,000 |
Accrued compensation | 8,819,000 | 9,952,000 |
Accrued research and development | 5,960,000 | 6,763,000 |
Other accrued liabilities | 6,721,000 | 3,598,000 |
Lease liabilities, current portion | 7,272,000 | |
Deferred revenue, current portion | 25,288,000 | 1,030,000 |
Total current liabilities | 58,212,000 | 27,734,000 |
Long-term portion of deferred revenue | 1,404,000 | 1,408,000 |
Long-term portion of deferred rent | 90,000 | |
Long-term portion of lease liabilities | 19,230,000 | |
Loans payable, net of discount | 9,810,000 | |
Other long-term liabilities | 5,098,000 | |
Commitments | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value; 10,000,000 shares authorized; none issued and outstanding as of December 31, 2019 and 2018 | ||
Common stock, $0.001 par value; 400,000,000 shares authorized; 167,987,850 and 167,171,505 shares issued and outstanding as of December 31, 2019 and 2018, respectively | 168,000 | 167,000 |
Additional paid-in capital | 1,329,852,000 | 1,319,068,000 |
Accumulated other comprehensive income (loss) | 23,000 | (24,000) |
Accumulated deficit | (1,276,228,000) | (1,209,334,000) |
Total stockholders' equity | 53,815,000 | 109,877,000 |
Total liabilities and stockholders' equity | $ 147,569,000 | $ 139,109,000 |
BALANCE SHEETS (Parenthetical)
BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
BALANCE SHEETS | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 400,000,000 | 400,000,000 |
Common stock, shares issued | 167,987,850 | 167,171,505 |
Common stock, shares outstanding | 167,987,850 | 167,171,505 |
STATEMENTS OF OPERATIONS
STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Total revenues | $ 59,288 | $ 44,509 | $ 4,484 |
Costs and expenses: | |||
Cost of product sales | 906 | 287 | |
Research and development | 52,885 | 46,903 | 46,269 |
Selling, general and administrative | 74,588 | 70,002 | 37,831 |
Total costs and expenses | 128,379 | 117,192 | 84,100 |
Loss from operations | (69,091) | (72,683) | (79,616) |
Interest income | 2,532 | 2,203 | 892 |
Interest expense | (335) | ||
Gain on disposal of assets | 732 | ||
Net loss | $ (66,894) | $ (70,480) | $ (77,992) |
Net loss per share, basic and diluted (in dollars per share) | $ (0.40) | $ (0.44) | $ (0.62) |
Weighted average shares used in computing net loss per share, basic and diluted (in shares) | 167,400 | 160,529 | 126,324 |
Product sales, net | |||
Total revenues | $ 43,772 | $ 13,947 | |
Contract revenues from collaborations | |||
Total revenues | $ 15,516 | $ 30,562 | $ 4,484 |
STATEMENTS OF COMPREHENSIVE LOS
STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
STATEMENTS OF COMPREHENSIVE LOSS | |||
Net loss | $ (66,894) | $ (70,480) | $ (77,992) |
Other comprehensive income (loss): | |||
Net unrealized gain (loss) on short-term investments | 47 | 58 | (64) |
Comprehensive loss | $ (66,847) | $ (70,422) | $ (78,056) |
STATEMENTS OF STOCKHOLDERS' EQU
STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Common stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Total |
Balance at Dec. 31, 2016 | $ 100 | $ 1,115,807 | $ (18) | $ (1,060,862) | $ 55,027 |
Balance (in shares) at Dec. 31, 2016 | 99,269,418 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net loss | (77,992) | (77,992) | |||
Net change in unrealized gain (loss) on short-term investments | (64) | (64) | |||
Issuance of common stock upon exercise of options and participation in Purchase Plan | $ 1 | 3,507 | 3,508 | ||
Issuance of common stock upon exercise of options and participation in Purchase Plan (in shares) | 1,564,395 | ||||
Issuance of common stock, net of offering costs | $ 46 | 114,134 | 114,180 | ||
Issuance of common stock, net of offering costs (in shares) | 45,981,093 | ||||
Stock compensation expense | 5,987 | 5,987 | |||
Balance at Dec. 31, 2017 | $ 147 | 1,239,435 | (82) | (1,138,854) | 100,646 |
Balance (in shares) at Dec. 31, 2017 | 146,814,906 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net loss | (70,480) | (70,480) | |||
Net change in unrealized gain (loss) on short-term investments | 58 | 58 | |||
Issuance of common stock upon exercise of options and participation in Purchase Plan | $ 2 | 4,730 | 4,732 | ||
Issuance of common stock upon exercise of options and participation in Purchase Plan (in shares) | 1,956,599 | ||||
Issuance of common stock, net of offering costs | $ 18 | 67,144 | 67,162 | ||
Issuance of common stock, net of offering costs (in shares) | 18,400,000 | ||||
Stock compensation expense | 7,759 | 7,759 | |||
Balance at Dec. 31, 2018 | $ 167 | 1,319,068 | (24) | (1,209,334) | 109,877 |
Balance (in shares) at Dec. 31, 2018 | 167,171,505 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net loss | (66,894) | (66,894) | |||
Net change in unrealized gain (loss) on short-term investments | 47 | 47 | |||
Issuance of common stock upon exercise of options and participation in Purchase Plan | $ 1 | 1,575 | 1,576 | ||
Issuance of common stock upon exercise of options and participation in Purchase Plan (in shares) | 816,345 | ||||
Stock compensation expense | 9,209 | 9,209 | |||
Balance at Dec. 31, 2019 | $ 168 | $ 1,329,852 | $ 23 | $ (1,276,228) | $ 53,815 |
Balance (in shares) at Dec. 31, 2019 | 167,987,850 |
STATEMENTS OF CASH FLOWS
STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Operating activities | |||
Net loss | $ (66,894) | $ (70,480) | $ (77,992) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Stock-based compensation expense | 9,115 | 7,704 | 5,987 |
Gain on disposal of assets | (732) | ||
Loss on sublease | 495 | ||
Depreciation and amortization | 683 | 594 | 465 |
Net amortization and accretion of discount on short-term investments and term loan | (1,073) | (766) | (350) |
Changes in assets and liabilities: | |||
Accounts receivable, net | (6,034) | (4,077) | |
Inventories | (366) | (839) | |
Prepaid and other current assets | (5,673) | (1,797) | (197) |
Other assets | 39 | 68 | 130 |
Right-of-use assets | 7,118 | ||
Accounts payable | (2,239) | 3,755 | (2,947) |
Accrued compensation | (1,133) | 2,893 | 2,974 |
Accrued research and development | (803) | 1,735 | (853) |
Other accrued liabilities | 3,122 | 269 | 2,236 |
Lease liability | (6,725) | ||
Deferred revenue | 24,255 | 2,437 | |
Deferred rent and other long term liabilities | 5,098 | (322) | (6,773) |
Net cash used in operating activities | (41,510) | (58,826) | (77,557) |
Investing activities | |||
Purchases of short-term investments | (145,327) | (77,996) | (116,861) |
Maturities of short-term investments | 123,126 | 104,066 | 96,820 |
Proceeds from disposal of assets | 732 | ||
Capital expenditures | (1,455) | (1,106) | (164) |
Net cash (used in) provided by investing activities | (23,656) | 24,964 | (19,473) |
Financing activities | |||
Net proceeds from term loan financing | 9,789 | ||
Net proceeds from issuances of common stock upon exercise of options and participation in Purchase Plan | 1,576 | 4,732 | 3,508 |
Proceeds from sale and issuance of common stock, net of offering costs | 67,162 | 114,180 | |
Net cash provided by financing activities | 11,365 | 71,894 | 117,688 |
Net (decrease) increase in cash and cash equivalents | (53,801) | 38,032 | 20,658 |
Cash and cash equivalents at beginning of period | 76,322 | 38,290 | 17,632 |
Cash and cash equivalents at end of period | 22,521 | $ 76,322 | $ 38,290 |
Supplemental disclosure of cash flow information | |||
Interest paid | $ 137 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2019 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of operations and basis of presentation We are a biotechnology company dedicated to discovering, developing and providing novel small molecule drugs that significantly improve the lives of patients with immune and hematologic disorders, cancer and rare diseases. Our pioneering research focuses on signaling pathways that are critical to disease mechanisms. Our first U.S. Food and Drug Administration (FDA) approved product is TAVALISSE ® (fostamatinib disodium hexahydrate), the only oral spleen tyrosine kinase (SYK) inhibitor, for the treatment of adult patients with chronic immune thrombocytopenia (ITP) who have had an insufficient response to a previous treatment. The marketing authorization application (MAA) for fostamatinib has been approved by the European Commission (EC) in Europe for the treatment of chronic ITP in adult patients who are refractory to other treatments, and will be marketed in Europe under the name TAVLESSE ® (fostamatinib). Our clinical programs include a Phase 3 study of fostamatinib in warm autoimmune hemolytic anemia (AIHA); a recently completed Phase 1 study of R835, a proprietary molecule from our interleukin receptor associated kinase (IRAK 1/4) inhibitor program; and an ongoing Phase 1 study of R552, a proprietary molecule from our receptor-interacting protein kinase (RIP1) inhibitor program. In addition, we have product candidates in clinical development with partners BerGenBio ASA (BerGenBio), Daiichi Sankyo (Daiichi), Aclaris Therapeutics (Aclaris), and AstraZeneca AB (AZ). Use of estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Significant estimates and assumptions made by management include those relating to revenue recognition on product sales and collaboration agreements, recoverability of our assets, including accounts receivables and inventories, stock-based compensation and the probability of achievement of corporate performance-based milestone for our performance-based stock option awards, impairment issues, the weighted average discount rate for our lease, estimated interest rate for our financing liability, the estimated useful life of assets, and estimated accruals, particularly research and development accruals, on an ongoing basis. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. To the extent there are material differences between these estimates and actual results, our financial statements will be affected. Inventories Inventories are stated at the lower of cost or estimated net realizable value. We determine the cost of inventories using the standard cost method, which approximates actual cost based on a FIFO basis. Inventories consist primarily of third-party manufacturing costs and allocated internal overhead costs. We began capitalizing inventory costs associated with our product upon regulatory approval when, based on management’s judgment, future commercialization was considered probable and the future economic benefit was expected to be realized. Prior to FDA approval of TAVALISSE, all manufacturing costs were charged to research and development expense in the period incurred. At December 31, 2019, our physical inventory included active pharmaceutical product of which costs have been previously charged to research and development expense. However, manufacturing of drug product, finished bottling and other labeling activities that occurred post FDA approval are included in the inventory value at December 31, 2019. We record write-downs for potential excess, dated or obsolete inventories based on an analysis of forecasted demand compared to quantities on hand and any firm purchase orders, as well as product shelf life. Cost of Product Sales Cost of product sales consists of third-party manufacturing costs, transportation and freight, and indirect overhead costs associated with the manufacture and distribution of TAVALISSE. A portion of the cost of producing the product sold to date was expensed as research and development prior to the NDA approval for TAVALISSE and therefore is not included in the cost of product sales during this period. Accounts Receivable Accounts receivable are recorded net of customer allowances for prompt payment discounts and any allowance for doubtful accounts. We estimate the allowance for doubtful accounts based on existing contractual payment terms, actual payment patterns of its customers and individual customer circumstances. As of December 31, 2019 and 2018, we have determined that an allowance for doubtful accounts is not required. Revenue Recognition We recognize revenue in accordance with ASC Topic 606, Revenue From Contracts with Customers (ASC 606) , when our customer obtains control of promised goods or services, in an amount that reflects the consideration which we expect to receive in exchange for those goods or services. To determine whether arrangements are within the scope of ASC 606, we perform the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies its performance obligation. We apply the five-step model to contracts when it is probable that the we will collect the consideration we are entitled to in exchange for the goods or services we transfer to the customer. At contract inception, once the contract is determined to be within the scope of this new guidance, we assess the goods or services promised within each contract and identify, as a performance obligation, and assess whether each promised good or service is distinct. We then recognize as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Product Sales Revenues from product sales are recognized when the Specialty Distributors (SDs), who are our customers, obtain control of our product, which occurs at a point in time, upon delivery to such SDs. These SDs subsequently resell our products to specialty pharmacy providers, health care providers, hospitals and clinics. In addition to distribution agreements with these SDs, we also enter into arrangements with specialty pharmacy providers, in-office dispensing providers, group purchasing organizations, and government entities that provide for government-mandated and/or privately-negotiated rebates, chargebacks and discounts with respect to the purchase of our products. Under ASC 606, we are required to estimate the transaction price, including variable consideration that is subject to a constraint, in our contracts with our customers. Variable considerations are included in the transaction price to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur. Revenue from product sales are recorded net of certain variable considerations which includes estimated government-mandated rebates and chargebacks, distribution fees, estimated product returns and other deductions. Provisions for returns and other adjustments are provided for in the period the related revenue is recorded. Actual amounts of consideration ultimately received may differ from our estimates. If actual results in the future vary from our estimates, we will adjust these estimates, which would affect net product revenue and earnings in the period such variances become known. The following are our significant categories of sales discounts and allowances: Sales Discounts . We provide our customers prompt payment discounts that are explicitly stated in our contracts and are recorded as a reduction of revenue in the period the related product revenue is recognized. Product Returns. We offer our SDs a right to return product purchased directly from us, which is principally based upon the product’s expiration date. Product return allowances are estimated and recorded at the time of sale. Government Rebates: We are subject to discount obligations under the state Medicaid programs, Tricare program and Medicare prescription drug coverage gap program. We estimate our Medicaid and Medicare prescription drug coverage gap rebates based upon a range of possible outcomes that are probability-weighted for the estimated payor mix. These reserves are recorded in the same period the related revenue is recognized, resulting in a reduction of product revenue and the establishment of a current liability that is included as part of Other Accrued Liabilities account in the Balance Sheet. Our liability for these rebates consists primarily of estimates of claims for the current quarter, and estimated future claims that will be made for product that has been recognized as revenue, but remains in the distribution channel inventories at the end of each reporting period. Chargebacks and Discounts: Chargebacks for fees and discounts represent the estimated obligations resulting from contractual commitments to sell products to certain specialty pharmacy providers, in-office dispensing providers, group purchasing organizations, and government entities at prices lower than the list prices charged to our SDs who directly purchase the product from us. These SDs charge us for the difference between what they pay for the product and our contracted selling price to these specialty pharmacy providers, in-office dispensing providers, group purchasing organizations, and government entities. These reserves are established in the same period that the related revenue is recognized, resulting in a reduction of product revenue. Actual chargeback amounts are generally determined at the time of resale to the specialty pharmacy providers, in-office dispensing providers, group purchasing organizations, and government entities by our SDs. The estimated obligations arising from these chargebacks and discounts are included as part of Other Accrued Liabilities in the balance sheet. Co-Payment Assistance: We offer co-payment assistance to commercially insured patients meeting certain eligibility requirements. The calculation of the accrual for co-pay assistance is based on an estimated number of claims and the cost per claim that we expect to receive associated with product that has been recognized as revenue. Contract Revenues from Collaborations In the normal course of business, we conduct research and development programs independently and in connection with our corporate collaborators, pursuant to which we license certain rights to our intellectual property to third parties. The terms of these arrangements typically include payment to us for a combination of one or more of the following: upfront license fees; development, regulatory and commercial milestone payments; product supply services; and royalties on net sales of licensed products. Upfront License Fees: If the license to our intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, we recognize revenues from upfront license fees allocated to the license when the license is transferred to the licensee and the licensee is able to use and benefit from the license. For licenses that are bundled with other promises, we determine whether the combined performance obligation is satisfied over time or at a point in time. If the combined performance obligation is satisfied over time, we use judgment in determining the appropriate method of measuring progress for purposes of recognizing revenue from the up-front license fees. We evaluate the measure of progress each reporting period and, if necessary, adjust the measure of performance and related revenue recognition. Development, Regulatory or Commercial Milestone Payments: At the inception of each arrangement that includes payments based on the achievement of certain development, regulatory and commercial or launch events, we evaluate whether the milestones are considered probable of being achieved and estimate the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within our or the licensee’s control, such as regulatory approvals, are not considered probable of being achieved until the uncertainty associated with the approvals has been resolved. The transaction price is then allocated to each performance obligation, on a relative standalone selling price basis, for which we recognize revenue as or when the performance obligations under the contract are satisfied. At the end of each subsequent reporting period, we re-evaluate the probability of achieving such development and regulatory milestones and any related constraint, and if necessary, adjust our estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, and recorded as part of contract revenues from collaborations during the period of adjustment. Product Supply Services: Arrangements that include a promise for future supply of drug product for either clinical development or commercial supply at the licensee’s discretion are generally considered as options. We assess if these options provide a material right to the licensee and if so, they are accounted for as separate performance obligations. Sales-based Milestone Payments and Royalties: For arrangements that include sales-based royalties, including milestone payments based on the volume of sales, we determine whether the license is deemed to be the predominant item to which the royalties or sales-based milestones relate to and if such is the case, we recognize revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). Stock award plans On May 16, 2018, our stockholders approved the adoption of the Company’s 2018 Equity Incentive Plan (2018 Plan). The 2018 Plan is the successor plan to the 2011 Equity Incentive Plan, the 2000 Equity Incentive Plan, and the 2000 Non-Employee Directors' Stock Option Plan. As of December 31, 2019, we have two stock option plans, our 2018 Plan and the Inducement Plan (collectively, the Equity Incentive Plans), that provide for granting to our officers, directors and all other employees and consultants options to purchase shares of our common stock. We also have our Employee Stock Purchase Plan (Purchase Plan), wherein eligible employees can purchase shares of our common stock at a price per share equal to the lesser of 85% of the fair market value on the first day of the offering period or 85% of the fair market value on the purchase date. The fair value of each option award is estimated on the date of grant using the Black-Scholes option pricing model which considered our stock price, as well as assumptions regarding a number of complex and subjective variables. These variables include, but are not limited to, volatility, expected term, risk-free interest rate and dividends. We estimate volatility over the expected term of the option using historical share price performance. For expected term, we take into consideration our historical data of options exercised, cancelled and expired. The risk-free rate is based on the U.S. Treasury constant maturity rate. We have not paid and do not expect to pay dividends in the foreseeable future. We use the straight-line attribution method over the requisite employee service period for the entire award in recognizing stock-based compensation expense. We account for forfeitures as they occur. We granted performance-based stock options to purchase shares of our common stock which will vest upon the achievement of certain corporate performance-based milestones. We determined the fair values of these performance-based stock options using the Black-Scholes option pricing model at the date of grant. For the portion of the performance-based stock options of which the performance condition is considered probable of achievement, we recognize stock-based compensation expense on the related estimated grant date fair values of such options on a straight-line basis from the date of grant up to the date when we expect the performance condition will be achieved. For the performance conditions that are not considered probable of achievement at the grant date or upon quarterly re-evaluation, prior to the event actually occurring, we recognize the related stock-based compensation expense when the event occurs or when we can determine that the performance condition is probable of achievement. In those cases, we recognize the change in estimate at the time we determine the condition is probable of achievement (by recognizing stock-based compensation expense as cumulative catch-up adjustment as if we had estimated at the grant date that the performance condition would have been achieved) and recognize the remaining compensation cost up to the date when we expect the performance condition will be achieved, if any. Cash, cash equivalents and short-term investments We consider all highly liquid investments in debt securities with maturity from the date of purchase of 90 days or less to be cash equivalents. Cash equivalents consist of money market funds, U.S. treasury bills, corporate bonds and commercial paper and investments in government‑sponsored enterprises. Our short-term investments include U.S. treasury bills, obligations of government‑ sponsored enterprises and corporate bonds and commercial paper. By policy, we limit the concentration of credit risk by diversifying our investments among a variety of high credit‑quality issuers. We view our short-term investments portfolio as available for use in current operations. Accordingly, we have classified certain securities as short-term investments on our balance sheet even though the stated maturity date of these securities may be more than one year from the current balance sheet date. All cash equivalents and short‑term investments are classified as available‑for‑sale securities. Available‑for‑sale securities are carried at fair value at December 31, 2019 and 2018. Unrealized gains (losses) are reported in the statements of stockholders’ equity and comprehensive loss. Fair value is estimated based on available market information or valuation methodologies. The cost of securities sold is based on the specific identification method. See Note 7 for a summary of available-for-sale securities at December 31, 2019 and 2018. Fair value of financial instruments The carrying values of cash, accounts receivable, prepaid and other current assets, accounts payable and accrued liabilities approximate fair value due to the short-term maturity of those instruments. Cash equivalents and short-term investments are carried at fair value at December 31, 2019 and 2018. Concentration of credit risk Financial instruments that potentially subject us to concentrations of credit risk are primarily cash and cash equivalents, short-term investments and accounts receivable. Cash equivalents and short-term investments primarily consist of money market funds, U.S. treasury bills, government-sponsored enterprise securities, and corporate bonds and commercial paper. Due to the short-term nature of these investments, we believe we do not have a material exposure to credit risk arising from our investments. All cash and cash equivalents and short-term investments are maintained with financial institutions that management believes are creditworthy. Concentrations of credit risk with respect to accounts receivable are limited due to our limited number of customers. Property and equipment Property and equipment are stated at cost. Depreciation is calculated using the straight‑line method over the estimated useful lives of the assets, which range from three to seven years. Research and development expenses Research and development expenses include costs for scientific personnel, supplies, equipment, consultants, research sponsored by us, allocated facility costs, costs related to pre‑clinical and clinical trials, including raw materials, and stock‑based compensation expense. All such costs are charged to research and development expense as incurred and at the time raw materials are purchased. Research and development accruals We have various contracts with third parties related to our research and development activities. Costs that are incurred but not billed to us as of the end of the period are accrued. We make estimates of the amounts incurred in each period based on the information available to us and our knowledge of the nature of the contractual activities generating such costs. Clinical trial contract expenses are accrued based on units of activity. Expenses related to other research and development contracts, such as research contracts, toxicology study contracts and manufacturing contracts are estimated to be incurred generally on a straight-line basis over the duration of the contracts. Raw materials and study materials not related to our approved drug, purchased for us by third parties are expensed at the time of purchase. Leases We currently lease our research and office space under a noncancelable lease agreement with our landlord through January 2023. In December 2014, we entered into a sublease agreement with an unrelated third party to occupy a portion of our research and office space through January 2023. We adopted ASU No. 2018-11, Leases (Topic 842) : Targeted Improvements as of January 1, 2019. Pursuant to Topic 842, all of our leases outstanding on January 1, 2019 continued to be classified as operating leases. With the adoption of Topic 842, we recorded an operating lease right-of-use asset and an operating lease liability on our balance sheet. Right-of-use lease assets represent our right to use the underlying asset for the lease term and the lease obligation represents our commitment to make the lease payments arising from the lease. Right-of-use lease assets and obligations are recognized at the commencement date based on the present value of remaining lease payments over the lease term. As our lease does not provide an implicit rate, we have used an estimated incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The operating lease right-of-use asset includes any lease payments made prior to commencement. The lease term may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Operating lease expense is recognized on a straight-line basis over the lease term, subject to any changes in the lease or expectations regarding the terms. Variable lease costs such as common area costs and property taxes are expensed as incurred. Leases with an initial term of 12 months or less are not recorded on the balance sheet. For our sublease agreement wherein we are the lessor, sublease income will be recognized on a straight-line basis over the term of the sublease. The difference between the cash received, and the straight-line lease income recognized, if any, will be recorded as part of prepaid and other current assets in the balance sheet. Prior to our adoption of Topic 842, we recorded a deferred rent asset or liability equal to the difference between the rent expense and the future minimum lease payments due. We recorded lease expense on a straight‑line basis for our lease, net of sublease income, wherein such arrangements contain scheduled rent increases over the term of the lease and sublease, respectively. Income taxes We use the asset and liability method to account for income taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities from a change in tax rates is recognized in income in the period the change is enacted. A valuation allowance is established to reduce deferred tax assets to an amount whose realization is more likely than not. Net loss per share Basic net loss per share is computed by dividing net loss by the weighted‑average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by dividing net loss by the weighted‑average number of shares of common stock outstanding during the period and the number of additional shares of common stock that would have been outstanding if potentially dilutive securities had been issued. Potentially dilutive securities include warrant and stock options and shares issuable under our Purchase Plan. The dilutive effect of these potentially dilutive securities is reflected in diluted earnings per share by application of the treasury stock method. Under the treasury stock method, an increase in the fair market value of our common stock can result in a greater dilutive effect from potentially dilutive securities. The following table sets forth the computation of basic and diluted net loss per share (in thousands, except per share amounts): Year Ended December 31, 2019 2018 2017 EPS Numerator: Net loss $ $ $ EPS Denominator—Basic and Diluted: Weighted-average common shares outstanding 167,400 160,529 126,324 Net loss per common share: Basic and diluted $ (0.40) $ (0.44) $ (0.62) During the periods presented, we had securities which could potentially dilute basic earnings per share, but were excluded from the computation of diluted net loss per share for all periods presented, as their effect would have been antidilutive. These securities consist of the following (in thousands except per share data): December 31, 2019 2018 2017 Outstanding stock options Weighted average exercise price of options $ $ $ Recent accounting pronouncements In February 2016, the FASB issued ASU No. 2016-02— Leases , (Topic 842) (ASU 2016-02), as amended, which generally requires lessees to recognize operating and financing lease liabilities and corresponding right-of-use assets on the balance sheet and to provide enhanced disclosures surrounding the amount, timing and uncertainty of cash flows arising from leasing arrangements. In July 2018, the FASB issued ASU No. 2018-11, Leases (Topic 842) : Targeted Improvements , or ASU No. 2018-11. In issuing ASU No. 2018-11, the FASB is permitting another transition method for ASU 2016-02, which allows the transition to the new lease standard by recognizing a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. We adopted this new standard on January 1, 2019 using a modified retrospective approach and elected the transition method and the package of practical expedients permitted under the transition guidance, which allowed us to carryforward our historical lease classification and our assessment on whether a contract is or contains a lease. We also elected to combine lease and non-lease components, such as common area maintenance charges, as single lease, and elected to use the short-term lease exception permitted by the standard. As a result of the adoption of Topic 842 on January 1, 2019, we recognized $32.8 million in operating right-of-use asset and $33.2 million in lease liability, and derecognized $399,000 of deferred rent in the balance sheet at adoption date. These were calculated using the present value of our remaining lease payments using an estimated incremental borrowing rate of 9%. There was no cumulative-effect adjustment on our accumulated deficit as of January 1, 2019. For our sublease agreement wherein we are the lessor, the same practical expedients apply to both lessor and lessee. Therefore , the sublease is classified as an operating lease under Topic 842. Further, the adoption of Topic 842 did not have an impact on our sublease on the date of adoption as all the expected In June 2018, the FASB issued ASU 2018-07— Compensation-Stock Compensation Improvements to Nonemployee Share-Based Payment Accounting (Topic 718) . This standard substantially aligns accounting for share-based payments to employees and non-employees. This standard is effective for annual periods beginning after December 15, 2018, including interim periods within that period, and early adoption is permitted. We adopted this new standard on January 1, 2019 and our adoption did not have a material effect on our financial statements. In June 2016, the FASB issued ASU 2016-13— Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which represents a new credit loss standard that will change the impairment model for most financial assets and certain other financial instruments. Specifically, this guidance will require entities to utilize a new “expected loss” model as it relates to trade and other receivables. In addition, entities will be required to recognize an allowance for estimated credit losses on available-for-sale debt securities, regardless of the length of time that a security has been in an unrealized loss position. This guidance will be effective for annual reporting periods beginning after December 15, 2019, including interim periods within those annual reporting periods. We will adopt this new standard on January 1, 2020 and do not expect a material impact of this new standard on our financial statements and related disclosures. In August 2018, the FASB issued ASU 2018-13 —Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement (ASU 2018-13) , which modifies the disclosure requirements on fair value measurements. This guidance is effective for fiscal years beginning after December 15, 2019, and interim periods therein. We will adopt this new standard on January 1, 2020 and do not expect a material impact of this new standard on our financial statements and related disclosures. In November 2018, the FASB issued ASU 2018-18— Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606 . This standard provides guidance on the interaction between Revenue Recognition (Topic 606) and Collaborative Arrangements (Topic 808) by aligning the unit of account guidance between the two topics and clarifying whether certain transactions between collaborative participants should be accounted for as revenue under Topic 606. ASU 2018-18 is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. |
REVENUES
REVENUES | 12 Months Ended |
Dec. 31, 2019 | |
REVENUES | |
REVENUES | 2. REVENUES Revenues disaggregated by category were as follows (in thousands): December 31, 2019 2018 2017 Product sales: Gross product sales $ $ 16,953 $ — Discounts and allowances (9,310) (3,006) — Product sales, net $ 43,772 $ 13,947 $ — Revenues from collaborations: License revenues $ 30,562 250 Development milestones 5,500 — 4,234 Research and development services and others 1,320 — — Total revenues from collaborations 15,516 30,562 4,484 Total revenues $ 59,288 $ 44,509 $ 4,484 The following table summarizes revenues from each of our customers who individually accounted for 10% or more of our gross revenues (as a percentage of gross revenues): December 31, 2019 2018 2017 ASD Healthcare and Oncology Supply — McKesson Specialty Care Distribution Corporation — Kissei — — BerGenBio — — Our first and only FDA approved product, TAVALISSE ® , was approved by the U.S. FDA in April 2018. We commenced commercial sale of TAVALISSE in the U.S. in May 2018. In addition to the distribution agreements with our customers, the SDs, we also enter into arrangements with specialty pharmacy providers, in-office dispensing providers, group purchasing organizations, and government entities that provide for government-mandated and/or privately-negotiated rebates, chargebacks and discounts with respect to the purchase of our products which reduced our gross product sales. Also refer to Revenue Recognition policy discussion in Note 1. The following tables summarize activity in each of the product revenue allowances and discounts during the year ended December 31, 2019 (in thousands): Chargebacks, Government Discounts and and Other Fees Rebates Returns Total Balance at January 1, 2019 $ 623 $ 843 $ 170 $ 1,636 Provision related to current period sales 5,170 2,864 99 8,133 Credit or payments made during the period (4,500) (1,906) (31) (6,437) Balance at December 31, 2019 $ 1,293 $ 1,801 $ 238 $ 3,332 Chargebacks, Government Discounts and and Other Fees Rebates Returns Total Balance at January 1, 2018 $ — $ — $ — $ — Provision related to current period sales 1,484 1,068 170 2,722 Credit or payments made during the period (861) (225) — (1,086) Balance at December 31, 2018 $ 623 $ 843 $ 170 $ 1,636 We incurred discounts and allowances for the year ended December 31, 2019 of $9.3 million, which includes the provision for current period sales of $8.1 million in the first table above, which is included as part of the Other Accrued Liabilities in the balance sheet, of which $3.3 million remained outstanding as of December 31, 2019. The remaining $1.2 million in discounts and allowances incurred related to current period sales not included in the above table for year ended December 31, 2019 relates to chargebacks, discounts and fees recorded as reductions in accounts receivable and prepaid and other current assets in the balance sheet. We incurred discounts and allowances for the year ended December 31, 2018 of $3.0 million, which includes the provision for period sales of $2.7 million in the second table above, which is included as part of the Other Accrued Liabilities in the balance, of which $1.6 million remained outstanding as of December 31, 2018. The remaining $285,000 in discounts and allowances incurred related to period sales not included in the above table for year ended December 31, 2018 is recorded as reduction of accounts receivable and prepaid and other current assets in the balance sheet. As of December 31, 2019, we have accounts receivable from Aclaris of $1.5 million, relative to the first amendment to the license and collaboration agreement with Aclaris. We determined that no allowance for doubtful accounts was necessary for our accounts receivable as of the years ended December 31, 2019 and 2018. |
SPONSORED RESEARCH AND LICENSE
SPONSORED RESEARCH AND LICENSE AGREEMENTS | 12 Months Ended |
Dec. 31, 2019 | |
SPONSORED RESEARCH AND LICENSE AGREEMENTS | |
SPONSORED RESEARCH AND LICENSE AGREEMENTS | 3. SPONSORED RESEARCH AND LICENSE AGREEMENTS We conduct research and development programs independently and in connection with our corporate collaborators. As of December 31, 2019, we are a party to collaboration agreements with ongoing performance obligations with Kissei Pharmaceutical Co., Ltd. (Kissei) for the development and commercialization of fostamatinib in Japan, China, Taiwan and the Republic of Korea, with Grifols, S.A. (Grifols) to commercialize fostamatinib in all indications, including chronic ITP, AIHA, and IgAN, in Europe and Turkey and with Medison Pharma Ltd. (Medison) to commercialize fostamatinib for chronic ITP in Canada and Israel. As of December 31, 2019, we are also a party to collaboration agreements, but do not have ongoing performance obligations, with Aclaris for the development and commercialization of JAK inhibitors for the treatment of alopecia areata and other dermatological conditions, AZ for the development and commercialization of R256, an inhaled JAK inhibitor, BerGenBio for the development and commercialization of AXL inhibitors in oncology, and Daiichi to pursue research related to MDM2 inhibitors, a novel class of drug targets called ligases. Under these agreements, which we entered into in the ordinary course of business, we received or may be entitled to receive upfront cash payments, payments contingent upon specified events achieved by such partners and royalties on any net sales of products sold by such partners under the agreements. Total future contingent payments to us under all of these agreements could exceed $631.7 million if all potential product candidates achieved all of the payment triggering events under all of our current agreements (based on a single product candidate under each agreement). Of this amount, up to $90.5 million relates to the achievement of development events, up to $165.2 million relates to the achievement of regulatory events and up to $376.0 million relates to the achievement of certain commercial or launch events. This estimated future contingent amount does not include any estimated royalties that could be due to us if the partners successfully commercialize any of the licensed products. Future events that may trigger payments to us under the agreements are based solely on our partners’ future efforts and achievements of specified development, regulatory and/or commercial events. Grifols License Agreement In January 2019, we entered into an exclusive commercialization license agreement with Grifols to commercialize fostamatinib in all indications, including chronic ITP, AIHA, and IgAN, in Europe and Turkey. Under the agreement, we received an upfront payment of $30.0 million, with the potential for $297.5 million in total regulatory and commercial milestones, which included a $17.5 million payment for EMA approval of fostamatinib for the first indication and a $2.5 million creditable advance royalty payment due upon EMA approval of fostamatinib in the first indication in chronic ITP. We will also receive stepped double-digit royalty payments based on tiered net sales which may reach 30% of net sales. In return, Grifols will receive exclusive rights to fostamatinib in human diseases, including chronic ITP, AIHA, and IgAN, in Europe and Turkey. The agreement also requires us to continue to conduct our long term open-label extension study on patients with ITP through EMA approval of ITP in Europe or until the study ends as well as conduct the Phase 3 trial in AIHA. In December 2019, we entered into a Drug Product Purchase Agreement with Grifols wherein we agreed to supply and sell to Grifols at 30% mark up the drug product requested under an anticipated first and only purchase order until Grifols enters into a supply agreement directly with a third-party drug product manufacturer. We accounted for this agreement under ASC 606 and identified the following distinct performance obligations at inception of the agreement: (a) granting of the license, (b) performance of research and regulatory services related to our ongoing long-term open-label extension study on patients with ITP, and (c) performance of research services related to our Phase 3 study in AIHA. In addition, we entered into a commercial supply agreement for the licensed territories. We concluded each of these performance obligations is distinct. We based our assessment on the following: (i) our assessment that Grifols can benefit from the license on its own by developing and commercializing the underlying product using its own resources, and (ii) the fact that the manufacturing services are not highly specialized in nature and can be performed by other vendors. Moreover, we determined that the upfront fee of $5.0 million, which is the non-refundable portion of the $30.0 million upfront fee, represented the transaction price, and was allocated to the performance obligations based on our best estimate of the relative standalone selling price as follows: (a) for the license, we estimated the standalone selling price using the adjusted market assessment approach to estimate its standalone selling price in the licensed territories; (b) for the research and regulatory services, we estimated the standalone selling price using the cost plus expected margin approach. The remaining $25.0 million of the upfront payment which is potentially refundable and the future variable consideration of $297.5 million related to future regulatory and commercial milestones were fully constrained due to the fact that it was probable that a significant reversal of cumulative revenue would occur, given the inherent uncertainty of success with these future milestones. We will recognize revenues related the research and regulatory services throughout the term of the respective clinical programs using the input method. For sales-based milestones and royalties, we determined that the license is the predominant item to which the royalties or sales-based milestones relate. Accordingly, we will recognize revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). We will re-evaluate the transaction price in each reporting period and as uncertain events are resolved or other changes in circumstances occur. Additionally, during the year ended December 31,2019, we recognized $4.7 million in revenues related to the research and regulatory services performed and the license right. Deferred revenues as of December 31, 2019 was In January 2020, we received approval of our MAA for fostamatinib for the treatment of chronic ITP in adult patients who are refractory to other treatments. With this approval, we received a $20.0 million payment which is comprised of a $17.5 million payment for EMA approval of fostamatinib for the first indication and a $2.5 million creditable advance royalty payment for EMA approval of fostamatinib in the first indication based on the terms of our collaboration with Grifols. The above milestone payment will be allocated to the distinct performance obligation in our collaboration agreement with Grifols. Kissei License Agreement In October 2018, we entered into an exclusive license and supply agreement with Kissei to develop and commercialize fostamatinib in all current and potential indications in Japan, China, Taiwan and the Republic of Korea. Kissei is responsible for performing and funding all development activities for fostamatinib in the above-mentioned territories . We received an upfront cash payment of $33.0 million with the potential for up to an additional $147.0 million in development, regulatory and commercial milestone payments , and will receive mid to upper twenty percent, tiered, escalated net sales-based payments for the supply of fostamatinib. Under the agreement, we are obligated to grant Kissei the license rights on fostamatinib on the territories above, as well as supply Kissei with drug product for use in clinical trials and pre-commercialization activities . We remain responsible for the manufacture and supply of fostamatinib for all development and commercialization activities under the agreement. We accounted for this agreement following ASC 606 and identified the following distinct performance obligations at inception of the agreement namely: (a) granting of the license, (b) supply of fostamatinib for clinical use and (c) material right associated with discounted fostamatinib that are supplied for use other than clinical or commercial. We concluded that the granting of the license is distinct relative to the other performance obligations. Moreover, we determined that the upfront fee of $33.0 million represented the transaction price and was allocated to the performance obligations based on our best estimate of the relative standalone selling price as follows: (a) for the license, we estimated the standalone selling price using the adjusted market assessment approach to estimate its standalone selling price in the licensed territories; (b) for the supply of fostamatinib and the material right associated with discounted fostamatinib, we estimated the standalone selling price using the cost plus expected margin approach. Variable considerations of $147.0 million related to future development and regulatory milestones was fully constrained due to the fact that it was probable that a significant reversal of cumulative revenue would occur, given the inherent uncertainty of success with these future milestones. We will recognize revenues related to the supply of fostamatinib and material right upon delivery of fostamatinib to Kissei. For sales-based milestones and royalties, we determined that the license is the predominant item to which the royalties or sales-based milestones relate to. Accordingly, we will recognize revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). We will re-evaluate the transaction price in each reporting period and as uncertain events are resolved or other changes in circumstances occur. As of December 31, 2018, we granted Kissei the license rights over fostamatinib. Accordingly, we recognized $30.6 million of the $33.0 million upfront fee as allocated revenue for the delivered license during the year ended December 31, 2018. As of December 31, 2019, we recognized $1.6 million as revenue related to the supply of fostamatinib for clinical use and the material right associated with discounted fostamatinib. At December 31, 2019, deferred revenues related to the unsatisfied performance obligations related to the supply of fostamatinib and material right associated with discounted fostamatinib supply was $1.4 million. Other license agreements In September 2019, we received a $4.0 million development milestone payment from Aclaris for the achievement of a certain event in accordance with the Rigel and Aclaris License and Collaboration Agreement dated August 27, 2015. In October 2019, we also received $3.8 million in a commercial launch milestone payment from Impact Biomedicines, Inc., which was acquired by Celgene. All deliverables under the agreement had been previously delivered, as such, the above payments of $4.0 million from Aclaris and $3.8 million from Celgene, triggered by the above events were recognized as revenue during the year ended December 31, 2019. As of December 31, 2019, we have accounts receivable of $1.5 million, relative to the first amendment to the license and collaboration agreement with Aclaris. In October 2019, we entered into two exclusive commercial and license agreements with Medison for the commercialization of fostamatinib for chronic ITP in Canada in which we received a $5.0 million upfront payment. We accounted for this agreement under ASC 606 and identified the following combined performance obligations at inception of the agreement: (a) granting of the license and (b) obtaining regulatory approval in Canada of fostamatinib in ITP. We determined that the non-refundable upfront fee of $5.0 million represented the transaction price. However, under the agreement, we have the option to buy back all rights to the product in Canada within six months that we obtain regulatory approval in Canada of the product for the indication of AIHA. The buyback option precludes us from transferring control of the license to Medison under ASC 606. We believe that the buyback provision, if exercised, will require us to repurchase the license at an amount equal to or more than the upfront $5.0 million. As such this arrangement is accounted for as a financing arrangement. |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2019 | |
INVENTORIES | |
INVENTORIES | 4. INVENTORIES The following table summarizes inventories, net as of December 31, 2019 and 2018 (in thousands): December 31, 2019 2018 Work in process $ $ 530 Finished goods 364 Total $ 1,354 $ 894 As of December 31, 2019, we have $3.0 million in advance payments to our manufacturer of our raw materials, which is included as part of Prepaid and Other Current Assets in the balance sheet. We take ownership of such raw materials when they are completed and delivered to us. |
SIGNIFICANT CONCENTRATIONS
SIGNIFICANT CONCENTRATIONS | 12 Months Ended |
Dec. 31, 2019 | |
SIGNIFICANT CONCENTRATIONS | |
SIGNIFICANT CONCENTRATIONS | 5. SIGNIFICANT CONCENTRATIONS We recognize revenue on collaborations in the U.S. and abroad and on products sold solely in the U.S. For the year ended December 31, 2019, our three specialty distributors as well as Aclaris, Grifols, Celgene and Kissei (see Note 2) accounted for 74%, 9%, 8%, 6% and 3% of our total revenues, respectively. For the year ended December 31, 2018, Kissei and our three specialty distributors (see Note 2) accounted for 69% and 31% of our total revenues, respectively. For the year ended December 31, 2017, BerGenBio and Celgene accounted for 74% and 26% of our total revenues, respectively. As of December 31, 2019 and 2018, 100% of our accounts receivables are from four customers and one collaboration partner. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2019 | |
STOCK-BASED COMPENSATION | |
STOCK-BASED COMPENSATION | 6. STOCK‑BASED COMPENSATION Total stock‑based compensation expense related to all of our stock‑based awards was as follows (in thousands): Year Ended December 31, 2019 2018 2017 Selling, general and administrative $ 6,453 $ 5,383 $ 4,490 Research and development 2,662 2,321 1,497 Total stock-based compensation expense $ 9,115 $ 7,704 $ 5,987 In 2017, we entered into severance agreements. As part of the severance arrangements we offered, we extended the date through which certain employee(s) had the right to exercise their vested options. In addition, we also accelerated the vesting period of certain unvested stock options. As a result of these modifications, we recorded an incremental stock-based compensation expense of approximately $1.4 million during the year ended December 31, 2017. The incremental compensation expenses were computed based on the fair values of the modified awards on the respective modification dates. These amounts are included as part of “Selling, general and administrative expense” in the accompanying 2017 Statement of Operations. Employee Stock Option Plans On May 16, 2018, our stockholders approved the adoption of the Company’s 2018 Equity Incentive Plan (2018 Plan). The 2018 Plan is the successor plan to the 2011 Equity Incentive Plan, the 2000 Equity Incentive Plan, and the 2000 Non-Employee Directors' Stock Option Plan. As of December 31, 2019, we have two stock option plans, our 2018 Plan and the Inducement Plan. The 2018 Plan provides for granting to our officers, directors and all other employees and consultants options to purchase shares of our common stock. The Inducement Plan is intended mainly to provide an inducement material for certain individuals to enter into employment with the Company. Options granted under our 2018 Plan expire no later than 10 years from the date of grant. Options may be granted with different vesting terms from time to time. As of December 31, 2019, a total of 38,114,675 shares of common stock were authorized for issuance under the 2018 Plan. Options granted under our Inducement Plan expire no later than 10 years from the date of grant and may be granted with different vesting terms from time to time. As of December 31, 2019, a total of 1,172,000 shares of common stock were authorized for issuance under the Inducement Plan. The fair value of each option award is estimated on the date of grant using the Black‑Scholes option pricing model. We have segregated option awards into the following three homogenous groups for the purposes of determining fair values of options: officers and directors, all other employees, and consultants. We account for forfeitures as they occur. We determined weighted‑average valuation assumptions separately for each of these groups as follows: · Volatility—We estimated volatility using the historical share price performance over the expected life of the option up to the point where we have historical market data. We also considered other factors, such as implied volatility, our current clinical trials and other company activities that may affect the volatility of our stock in the future. We determined that at this time historical volatility is more indicative of our expected future stock performance than implied volatility. · Expected term—For options granted to consultants, we use the contractual term of the option, which is generally 10 years, for the initial valuation of the option and the remaining contractual term of the option for the succeeding periods. We analyzed various historical data to determine the applicable expected term for each of the other option groups. This data included: (1) for exercised options, the term of the options from option grant date to exercise date; (2) for cancelled options, the term of the options from option grant date to cancellation date, excluding non-vested option forfeitures; and (3) for options that remained outstanding at the balance sheet date, the term of the options from option grant date to the end of the reporting period and the estimated remaining term of the options. The consideration and calculation of the above data gave us reasonable estimates of the expected term for each employee group. We also considered the vesting schedules of the options granted and factors surrounding exercise behavior of the option groups, our current market price and company activity that may affect our market price. In addition, we considered the optionee type (i.e., officers and directors or all other employees) and other factors that may affect the expected term of the option. · Risk‑free interest rate—The risk‑free interest rate is based on U.S. Treasury constant maturity rates with similar terms to the expected term of the options for each option group. · Dividend yield—The expected dividend yield is 0% as we have not paid and do not expect to pay dividends in the future. The following table summarizes the weighted‑average assumptions relating to options granted pursuant to our equity incentive plans for the years ended December 31, 2019, 2018 and 2017: Year Ended December 31, 2019 2018 2017 Risk-free interest rate % % % Expected term (in years) Dividend yield % % % Expected volatility % % % The exercise price of stock options granted under our stock plans is equal to the fair market value of the underlying shares on the date of grant. Options become exercisable at varying dates and generally expire 10 years from the date of grant. At December 31, 2019, options to purchase 16,615,971 shares of common stock were available for grant and 22,670,704 reserved shares of common stock were available for future issuance under our stock option plans. Stock‑Based Compensation Award Activity Option activity under our equity incentive plans was as follow: Weighted- Average Remaining Shares Available Number of Shares Weighted-Average Contractual Term Aggregate For Grant Underlying Options Exercise Price (in years) Intrinsic Value Outstanding at January 1, 2019 15,097,014 20,713,331 $ 4.20 Authorized for grant 3,544,984 — Granted (7,457,575) 7,457,575 $ 2.03 Exercised — (68,654) $ 2.05 Cancelled 5,431,548 (5,431,548) $ 4.16 Outstanding at December 31, 2019 16,615,971 22,670,704 $ 3.51 6.15 $ 809,459 Vested and expected to vest at December 31, 2019 22,363,204 $ 3.51 Exercisable at December 31, 2019 15,804,733 $ 3.97 5.10 $ 243,612 We granted options to purchase 7,457,575, 4,594,225 and 4,048,675 shares of common stock during the years ended December 31, 2019, 2018 and 2017, respectively. The weighted‑average grant date fair values of options granted during 2019, 2018 and 2017 were $1.27, $2.66 and $1.48, respectively. As of December 31, 2019, we had 307,500 shares of outstanding performance-based stock option wherein the achievement of the corresponding corporate-based milestones were not considered as probable. Accordingly, none of the stock-based compensation expense of $363,000 has been recognized as expense as of December 31, 2019. As of December 31, 2019, there was approximately $8.9 million of unrecognized stock-based compensation cost related to time-based stock options and performance-based stock options, wherein achievement of the corresponding corporate-based milestones was considered as probable. Additionally, approximately $475,000 of total unamortized stock-based compensation cost related to our Purchase Plan. The unamortized compensation costs related to our stock option plans and our Purchase Plan are expected to be recognized over a weighted‑ average period of approximately 2.3 years and 0.4 years, respectively. For the years ended December 31, 2019 and 2018, there were 4,442,936 and 2,924,823 shares vested, respectively, with weighted‑average exercise price of $3.26 and $2.88, respectively. The aggregate intrinsic value of the stock options in the table above is calculated as the difference between the exercise price of the underlying awards and the quoted price of our common stock for the options that were in‑the‑money at December 31, 2019. At December 31, 2019 and 2018, we had 6,865,971 and 5,962,769, respectively, of non-vested stock options, with approximately $614,000 and $121,000 intrinsic value at December 31, 2019 and 2018, respectively. During the years ended December 31, 2019 and 2018, aggregate intrinsic values of options exercised under our stock option plans were approximately $12,000 and $1.3 million, respectively, determined as of the date of the stock option exercise. Details of our stock options by exercise price are as follows as of December 31, 2019: Options Outstanding Options Exercisable Number of Weighted-Average Outstanding Remaining Weighted-Average Number of Weighted-Average Exercise Price Options Contractual Life (in years) Exercise Price Options Exercise Price $1.68 - $1.96 479,134 9.51 $ 1.95 10,834 $ 1.68 $2.00 - $2.00 4,426,817 8.57 2.00 821,292 2.00 $2.02 - $2.14 3,814,210 5.97 2.11 3,433,546 2.12 $2.21 - $2.74 3,621,639 6.88 2.52 2,590,664 2.62 $2.76 - $3.80 3,231,670 5.83 3.50 2,676,557 3.50 $3.84 - $4.49 3,777,761 6.48 4.32 2,952,367 4.31 $4.53 - $9.62 3,319,473 1.63 7.50 3,319,473 7.50 $1.68 - $9.62 22,670,704 6.13 3.51 15,804,733 3.97 Employee Stock Purchase Plan Our Purchase Plan permits eligible employees to purchase common stock at a discount through payroll deductions during defined offering periods. The price at which the stock is purchased is equal to the lesser of 85% of the fair market value of the common stock on the first day of the offering or 85% of the fair market value of our common stock on the purchase date. The initial offering period commenced on the effective date of our initial public offering. We issued 747,691, 783,984 and 403,302 shares of common stock during 2019, 2018 and 2017, respectively, pursuant to the Purchase Plan at an average price of $1.92, $1.92 and $1.87, respectively. For 2019, 2018 and 2017, the weighted average fair value of awards granted under our Purchase Plan was $1.07, $1.27 and $0.99, respectively. As of December 31, 2019, we had 583,893 reserved shares of common stock available for future issuance under the Purchase Plan. The fair value of awards granted under our Purchase Plan is estimated on the date of grant using the Black‑Scholes option pricing model, which uses weighted‑ average assumptions. Our Purchase Plan provides for a 24- month offering period comprised of four six‑month purchase periods with a look‑back option. A look‑back option is a provision in our Purchase Plan under which eligible employees can purchase shares of our common stock at a price per share equal to the lesser of 85% of the fair market value on the first day of the offering period or 85% of the fair market value on the purchase date. Our Purchase Plan also includes a feature that provides for a new offering period to begin when the fair market value of our common stock on any purchase date during an offering period falls below the fair market value of our common stock on the first day of such offering period. This feature is called a “reset.” Participants are automatically enrolled in the new offering period. We had a “reset” on January 2, 2020 because the fair market value of our stock on December 31, 2019 was lower than the fair market value of our stock on January 1, 2019, the first day of the offering period. We applied modification accounting in accordance with the relevant accounting guidance. The total incremental fair value associated with this Purchase Plan “reset” was approximately $753,000 and will be recognized as expense from the period from January 1, 2020 to December 31, 2021. The following table summarizes the weighted‑average assumptions related to our Purchase Plan for the years ended December 31, 2019, 2018 and 2017. Expected volatilities for our Purchase Plan are based on the two‑year historical volatility of our stock. Expected term represents the weighted‑ average of the purchase periods within the offering period. The risk‑free interest rate for periods within the expected term is based on U.S. Treasury constant maturity rates. Year Ended December 31, 2019 2018 2017 Risk-free interest rate 2.7 % 2.4 % 0.5 % Expected term (in years) 1.5 1.3 1.5 Dividend yield % % % Expected volatility 62.6 % 66.2 % 63.1 % |
CASH, CASH EQUIVALENTS AND SHOR
CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS | 12 Months Ended |
Dec. 31, 2019 | |
CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS | |
CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS | 7. CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS Cash, cash equivalents and short-term investments consist of the following (in thousands): December 31, 2019 2018 Cash $ 3,371 $ 2,626 Money market funds 7,457 9,106 U.S. treasury bills 12,539 — Government-sponsored enterprise securities 19,017 7,872 Corporate bonds and commercial paper 55,694 108,933 $ 98,078 $ 128,537 Reported as: Cash and cash equivalents $ 22,521 $ 76,322 Short-term investments 75,557 52,215 $ 98,078 $ 128,537 Cash equivalents and short-term investments included the following securities with gross unrealized gains and losses (in thousands): Gross Gross Amortized Unrealized Unrealized December 31, 2019 Cost Gains Losses Fair Value U.S. treasury bills $ 12,532 $ 8 $ (1) $ 12,539 Government-sponsored enterprise securities $ 19,010 $ 8 $ (1) $ 19,017 Corporate bonds and commercial paper 55,685 14 (5) 55,694 Total $ 87,227 $ 30 $ (7) $ 87,250 Gross Gross Amortized Unrealized Unrealized December 31, 2018 Cost Gains Losses Fair Value Government-sponsored enterprise securities $ 7,873 $ — $ (1) $ 7,872 Corporate bonds and commercial paper 108,957 2 (26) 108,933 Total $ 116,830 $ 2 $ (27) $ 116,805 As of December 31, 2019, our cash equivalents and short-term investments, which have contractual maturities within one year, had a weighted‑average time to maturity of approximately 117 days. We view our short-term investments portfolio as available for use in current operations. We have the ability to hold all investments as of December 31, 2019 through their respective maturity dates. At December 31, 2019, we had no investments that had been in a continuous unrealized loss position for more than 12 months. As of December 31, 2019, a total of 19 individual securities had been in an unrealized loss position for 12 months or less and the losses were deemed to be temporary. The gross unrealized losses above were caused by interest rate increases. No significant facts or circumstances have arisen to indicate that there has been any deterioration in the creditworthiness of the issuers of the securities held by us. Based on our review of these securities, including the assessment of the duration and severity of the unrealized losses and our ability and intent to hold the investments until maturity, there were no other-than-temporary impairments for these securities at December 31, 2019. The following table shows the fair value and gross unrealized losses of our investments in individual securities that are in an unrealized loss position, aggregated by investment category (in thousands): December 31, 2019 Fair Value Unrealized Losses U. S. treasury bills $ 4,512 $ (1) Government-sponsored enterprise securities 8,009 (1) Corporate bonds and commercial paper 18,731 (5) Total $ 31,252 $ (7) |
FAIR VALUE
FAIR VALUE | 12 Months Ended |
Dec. 31, 2019 | |
FAIR VALUE | |
FAIR VALUE | 8. FAIR VALUE Under FASB ASC 820, Fair Value Measurements and Disclosures , fair value is defined as the price at which an asset could be exchanged or a liability transferred in a transaction between knowledgeable, willing parties in the principal or most advantageous market for the asset or liability. Where available, fair value is based on observable market prices or parameters or derived from such prices or parameters. Where observable prices or parameters are not available, valuation models are applied. Assets recorded at fair value in our financial statements are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Hierarchical levels directly related to the amount of subjectivity associated with the inputs to fair valuation of these assets and liabilities, are as follows: Level 1—Inputs are unadjusted, quoted prices in active markets for identical assets at the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. The fair valued assets we hold that are generally included under this Level 1 are money market securities where fair value is based on publicly quoted prices. Level 2—Are inputs, other than quoted prices included in Level 1, that are either directly or indirectly observable for the asset or liability through correlation with market data at the reporting date and for the duration of the instrument’s anticipated life. The fair valued assets we hold that are generally assessed under Level 2 included government‑sponsored enterprise securities, U.S. treasury bills and corporate bonds and commercial paper. We utilize third party pricing services in developing fair value measurements where fair value is based on valuation methodologies such as models using observable market inputs, including benchmark yields, reported trades, broker/dealer quotes, bids, offers and other reference data. We use quotes from external pricing service providers and other on‑line quotation systems to verify the fair value of investments provided by our third-party pricing service providers. We review independent auditor’s reports from our third-party pricing service providers particularly regarding the controls over pricing and valuation of financial instruments and ensure that our internal controls address certain control deficiencies, if any, and complementary user entity controls are in place. Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities and which reflect management’s best estimate of what market participants would use in pricing the asset or liability at the reporting date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. We do not have fair valued assets classified under Level 3. Fair Value on a Recurring Basis Financial assets measured at fair value on a recurring basis are categorized in the tables below based upon the lowest level of significant input to the valuations (in thousands): Assets at Fair Value as of December 31, 2019 Level 1 Level 2 Level 3 Total Money market funds $ 7,457 $ — $ — $ 7,457 U.S. treasury bills — 12,539 — 12,539 Government-sponsored enterprise securities — 19,017 — 19,017 Corporate bonds and commercial paper — 55,694 — 55,694 Total $ 7,457 $ 87,250 $ — $ 94,707 Assets at Fair Value as of December 31, 2018 Level 1 Level 2 Level 3 Total Money market funds $ 9,106 $ — $ — $ 9,106 Government-sponsored enterprise securities — 7,872 — 7,872 Corporate bonds and commercial paper — 108,933 — 108,933 Total $ 9,106 $ 116,805 $ — $ 125,911 |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2019 | |
PROPERTY AND EQUIPMENT | |
PROPERTY AND EQUIPMENT | 9. PROPERTY AND EQUIPMENT Property and equipment consists of the following (in thousands): December 31, 2019 2018 Laboratory equipment $ $ Computer and software 1,622 Furniture and equipment 1,391 1,403 Fixed assets in progress — Total property and equipment 15,204 Less accumulated depreciation and amortization Property and equipment, net $ 2,159 $ During 2019 and 2018, we disposed fixed assets of approximately $496,000 and $18,000, respectively. Total depreciation and amortization expense were $683,000, $594,000 and $465,000 for the years ended December 31, 2019, 2018 and 2017, respectively. |
LEASE AGREEMENTS
LEASE AGREEMENTS | 12 Months Ended |
Dec. 31, 2019 | |
LEASE AGREEMENTS | |
LEASE AGREEMENTS | 10. LEASE AGREEMENTS We currently lease our research and office space under a noncancelable lease agreement with our landlord, HCP BTC, LLC (formerly known as Slough BTC, LLC) which was originally set to expire in 2018. The lease term provides for renewal option for up to two additional periods of five years each. In July 2017, we exercised our option to extend the term of our lease for another five years through January 2023 and modified the amount of monthly base rent during such renewal period. We reevaluated our lease classification and continue to classify our lease as operating lease during the renewal period. In December 2014, we entered into a sublease agreement, which was amended in 2017, with an unrelated third party to occupy approximately 57,000 square feet of our research and office space. In February 2017, we entered into an amendment to the sublease agreement to increase the subleased research and office space for an additional 9,328 square feet under the same term of the sublease. Effective July 2017, the sublease agreement was amended primarily to extend the term of the sublease through January 2023 and modified the monthly base rent to equal the amount we will pay our landlord. Because the future sublease income under the extended sublease agreement is the same as the amount we will pay our landlord, we did not recognize any loss on sublease relative to this amendment. We expect to receive approximately $14.0 million in future sublease income (excluding our subtenant’s share of facilities operating expenses) through January 2023. We recorded rent expense on a straight-line basis for our lease, net of sublease income. For our sublease arrangement which we classified as an operating lease, our loss on the sublease was comprised of the present value of our future payments to our landlord less the present value of our future rent payments expected from our subtenant over the term of the sublease. Further, in conjunction with our facilities lease, we have previously issued to our landlord warrants to purchase our common stock. We have previously capitalized the fair value of these warrants at issuance as part of our other long-term assets and they were amortized up to January 31, 2018. The liability arising from this sublease agreement was determined using a credit-adjusted risk-free rate to discount the estimated future net cash flows. The changes in the liability related to the sublease agreement during the years ended December 31, 2018 and 2017 were as follows (in thousands): Balance at January 1, 2017 $ 3,460 Increase in deferred liability 495 Accretion of deferred liability 157 Amortization of deferred liability (3,828) Balance at December 31, 2017 284 Accretion of deferred liability 2 Amortization of deferred liability (286) Balance at December 31, 2018 $ — We adopted Topic 842 on January 1, 2019 using a modified retrospective approach and elected the transition method and the package of practical expedients permitted under the transition guidance, which allowed us to carryforward our historical lease classification and our assessment on whether a contract is or contains a lease. We also elected to combine lease and non-lease components, such as common area maintenance charges, as single lease, and elected to use the short-term lease exception permitted by the standard. As a result of the adoption of Topic 842 on January 1, 2019, we recognized $32.8 million in operating right-of-use asset and $33.2 million in lease liability, and derecognized $399,000 of deferred rent in the balance sheet at adoption date. These were calculated using the present value of our remaining lease payments using an estimated incremental borrowing rate of 9%, which represented the weighted average discount rate for our lease. There was no cumulative-effect adjustment on our accumulated deficit as of January 1, 2019. As of December 31, 2019, we had operating lease right-of-use asset of $25.7 million and lease liability of $27.0 million in the balance sheet. The weighted average remaining term of our lease as of December 31, 2019 was 3.08 years. For the year ended December 31, 2019, the components of our operating lease expense was as follows (in thousands): Year Ended December 31, 2019 Fixed operating lease expense $ 5,248 Variable operating lease expense 745 Total operating lease expense $ 5,993 Supplemental information related to our operating lease for the years ended December 31, 2019 was as follows (in thousands): Cash payments included in the measurement of operating lease liabilities $ 9,321 Right-of-use asset obtained in exchange for operating lease obligations — At the time of adoption, we did not have any additional significant lease that had not yet commenced. For the year ended December 31, 2019, we have the following operating sublease information (in thousands): Year Ended December 31, 2019 Fixed sublease expense $ 4,381 Variable sublease expense 829 Sublease income (5,210) Net $ — At December 31, 2019, future minimum lease payments and obligations under our noncancelable operating lease, net of expected sublease receipts, were as follows (in thousands): Operating Sublease For years ending December 31, Lease Receipts Net 2020 $ 9,694 $ (4,360) $ 5,334 2021 10,082 (4,534) 5,548 2022 10,485 (4,716) 5,769 2023 877 (394) 483 Total minimum payments required $ 31,138 $ (14,004) $ 17,134 Rent expense under our operating lease amounted to approximately $6.0 million, $6.0 million and $6.9 million for the years ended December 31, 2019, 2018 and 2017, respectively. The rent expense during the years ended December 31, 2019, 2018 and 2017 were net of sublease income, subtenant’s share of certain facilities operating expense and amortization of deferred liability in the aggregate total of $5.2 million, $5.1 million, and $8.0 million, respectively. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2019 | |
STOCKHOLDERS' EQUITY | |
STOCKHOLDERS' EQUITY | 11. STOCKHOLDERS’ EQUITY Preferred Stock We are authorized to issue 10,000,000 shares of preferred stock. As of December 31, 2019 and 2018, there were no issued and outstanding shares of preferred stock. Our board of directors is authorized to fix or alter the designation, powers, preferences and rights of the shares of each series of preferred shares, and the qualifications, limitations or restrictions of any wholly unissued shares, to establish from time to time the number of shares constituting any such series, and to increase or decrease the number of shares, if any. Common Stock Authorized Shares of Common Stock On May 18, 2018, we amended our Certificate of Incorporation (the “Charter Amendment”) to increase the number of authorized shares of common stock from 200,000,000 to 400,000,000 shares. This Charter Amendment was approved by our stockholders at the annual meeting held on May 16, 2018. The Charter Amendment became effective upon the filing with the Secretary of State of the State of Delaware on May 18, 2018. Common Stock Public Offering In the second quarter of 2018, we completed an underwritten public offering in which we sold 18,400,000 shares of our common stock pursuant to an effective registration statement at a price to the public of $3.90 per share. We received net proceeds of approximately $67.2 million after deducting underwriting discounts and commissions and offering expenses. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2019 | |
INCOME TAXES | |
INCOME TAXES | 12. INCOME TAXES For the years ended December 31, 2019, 2018 and 2017, our loss before income taxes was from domestic operations. For the years ended December 31, 2019, 2018 and 2017, we did not record provision for income taxes other than minimum state taxes due to our net loss. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of our deferred tax assets are as follows (in thousands): December 31, 2019 2018 Deferred tax assets Net operating loss carryforwards $ $ Orphan drug and research and development credits Deferred compensation Lease liabilities — Capitalized research and development expenses Other, net Deferred tax liabilities Operating lease right-of-use asset — Total net deferred tax assets Less: valuation allowance Deferred tax assets, net of allowance $ — $ — The reconciliation of the statutory federal income tax rate to the effective tax rate was as follows: Year Ended December 31, 2019 2018 2017 Federal statutory tax rate (21.0) % (21.0) % (34.0) % Federal statutory rate reduction — % — % 160.2 % State, Net of Federal Benefit 0.1 % — % — % Valuation allowance 21.7 % 16.3 % (126.5) % Stock compensation 2.8 % 8.2 % 5.7 % Orphan drug and research and development credits (5.1) % (3.7) % (3.6) % Other, net 1.5 % 0.2 % (1.8) % Effective tax rate % % % In general, under Section 382 of the Internal Revenue Code (Section 382), a corporation that undergoes an ownership change is subject to limitations on its ability to utilize its pre-change net operating loss carryovers and tax credits to offset future taxable income. Our existing net operating loss carryforwards and tax credits are subject to limitations arising from ownership changes which occurred in previous periods. We finalized our analysis of potential ownership changes and concluded our Section 382 owner shift analysis during the year ended December 31, 2012. We have updated our net operating loss carryforwards to reflect the results of the Section 382 owner shift analysis as of December 31, 2019. We did not experience any significant changes in ownership in 2019, 2018, and 2017. Future changes in our stock ownership, some of which are outside of our control, could result in an ownership change under Section 382 and result in additional limitations. As of December 31, 2019, we had net operating loss carryforwards for federal income tax purposes of approximately $1.0 billion. Of the federal net operating loss carryforward, $897.7 million, which expire beginning in the year 2020 and the remaining net operating loss carryforwards can be carried forward indefinitely, subject to annual limitation of 80% of taxable income. We also had state net operating loss carryforwards of approximately $406.2 million, which expire beginning in the year 2028. We have general business credits of approximately $43.8 million, which will expire beginning in 2023, if not utilized, and is comprised of research and development credits and orphan drug credits. We also have state research and development tax credits of approximately $29.5 million, which have no expiration date. Realization of deferred tax assets is dependent upon future earnings, if any, the timing and amount of which are uncertain. Accordingly, the net deferred tax assets have been fully offset by a valuation allowance. The valuation allowance increased by approximately $21.6 million and increased by approximately $8.4 million for the years ended December 31, 2019 and 2018, respectively. The following table summarizes the activity related to our gross unrecognized tax benefits (in thousands): Year Ended December 31, 2019 2018 Balance at the beginning of the year $ 7,849 $ 7,430 Increase related to current year tax positions 509 419 Balance at the end of the year $ 8,358 $ 7,849 Included in the balance of unrecognized tax benefits at December 31, 2019 and 2018 respectively, are $7.2 million and $6.8 million of tax benefits that, if recognized, would result in adjustments to other tax accounts, primarily deferred taxes. No income tax benefit would be realized due to our valuation allowance position. We are subject to federal income tax and various state taxes. Because of net operating loss and research credit carryovers, substantially all of our tax years remain open to examination. Our policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. We currently have no tax positions that would be subject to interest or penalties. |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2019 | |
DEBT | |
DEBT | 13. DEBT On September 27, 2019, we entered into a Credit and Security Agreement (Credit Agreement), dated as of September 27, 2019 (the Closing Date) with MidCap Financial Trust (MidCap). The Credit Agreement provides for a $60.0 million term loan credit facility with the following tranches: (i) on the Closing Date, $10.0 million aggregate principal amount of term loans, (ii) until December 31, 2020, an additional $10.0 million term loan facility at our option, (iii) until March 31, 2021, an additional $20.0 million term loan facility subject to the satisfaction of certain conditions and at our option and (iv) until March 31, 2022, an additional $20.0 million term loan facility subject to the satisfaction of certain conditions and at our option. The obligations under the Credit Agreement are secured by a perfected security interest in all of our assets except for intellectual property and certain other customary excluded property pursuant to the terms of the Credit Agreement. The outstanding principal balance of the loan bears interest at an annual rate of one-month LIBOR plus 5.65%, subject to a LIBOR floor of 1.50% and is payable monthly in arrears. Commencing on October 1, 2019, we initially will make interest-only payments for 24 months followed by 36 months of amortization payments. The interest-only period will be extended to 36 months and again to 48 months upon the satisfaction of certain conditions set forth in the Credit Agreement. All unpaid principal and accrued interest is due and payable no later than September 1, 2024. A final payment fee of 2.5% of principal is due on the final payment of the term loan. We may make voluntary prepayments, in whole or in part, subject to certain prepayment premiums and additional interest payments. The Credit Agreement also contains certain provisions, such as event of default and change in control provisions, which, if triggered, would require us to make mandatory prepayments on the term loan, which are subject to certain prepayment premiums and additional interest payments. As discussed above, at closing of the Credit Agreement, $10.0 million was funded in an initial tranche. The facility also gives us the ability to access an additional $50.0 million at our option, of which $40.0 million is subject to the achievement of certain customary conditions. The following table presents the future minimum payments we expect to make on our outstanding loan as of December 31, 2019 (in thousands): Year Ending December 31, 2021 $ 556 2022 3,333 2023 3,333 2024 2,778 Principal amount (initial tranche) $ 10,000 We paid certain costs and fees totaling $211,000 which were recorded as a direct deduction from the term loan on the balance sheet and are being amortized ratably as interest expense over the term of the loan, using the effective interest method. As of December 31, 2019, the unamortized issuance costs and debt discounts amounted to $191,000. Interest expense, including amortization of the debt discount, related to the Credit Agreement was $237,000 for the year ended December 31, 2019. Accrued interest was $62,000 as of December 31, 2019. As of December 31, 2019, the outstanding balance of the loan was $9.8 million, net unamortized debt discount. The Credit Agreement contains certain covenants which, among others, require us to deliver financial reports at designated times of the year and maintain minimum net revenues and $10.0 million of cash upon the draw of tranche three or tranche four. As of December 31, 2019, we were not in violation of any covenants. |
SELECTED QUARTERLY FINANCIAL DA
SELECTED QUARTERLY FINANCIAL DATA | 12 Months Ended |
Dec. 31, 2019 | |
SELECTED QUARTERLY FINANCIAL DATA | |
SELECTED QUARTERLY FINANCIAL DATA | 14. SELECTED QUARTERLY FINANCIAL DATA Year Ended December 31, 2019 Year Ended December 31, 2018 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 (unaudited, in thousands, except per share amounts) Revenue $ 12,624 $ 10,407 $ 20,857 $ 15,400 $ — $ 1,787 $ 4,865 $ 37,857 Gross profit* $ 7,947 $ 9,862 $ 11,406 $ 13,651 $ — $ 1,757 $ 4,796 $ 7,107 Net loss $ (17,598) $ (20,606) $ (11,490) $ (17,200) $ (24,385) $ (25,557) $ (23,766) $ 3,228 Net income (loss) per share, basic and diluted: $ (0.11) $ (0.12) $ (0.07) $ (0.10) $ (0.17) $ (0.16) $ (0.14) $ 0.02 Weighted average shares used in computing net income (loss) per share: Basic 167,173 167,191 167,609 167,619 147,114 161,577 166,464 166,680 Diluted 167,173 167,191 167,609 167,745 147,114 161,577 166,464 167,617 * |
SUBSEQUENT EVENT
SUBSEQUENT EVENT | 12 Months Ended |
Dec. 31, 2019 | |
SUBSEQUENT EVENT | |
SUBSEQUENT EVENT | 15. SUBSEQUENT EVENT In January 2020, we received EC approval of our MAA for fostamatinib for the treatment of chronic immune thrombocytopenia in adult patients who are refractory to other treatments. With this approval, we received in February 2020 a $20.0 million payment, which is comprised of a $17.5 million payment for EMA approval of fostamatinib for the first indication and a $2.5 million creditable advance royalty payment, based on the terms of our collaboration agreement with Grifols. The above milestone payment will be allocated to the distinct performance obligation in the collaboration agreement with Grifols. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Nature of operations and basis of presentation | Nature of operations and basis of presentation We are a biotechnology company dedicated to discovering, developing and providing novel small molecule drugs that significantly improve the lives of patients with immune and hematologic disorders, cancer and rare diseases. Our pioneering research focuses on signaling pathways that are critical to disease mechanisms. Our first U.S. Food and Drug Administration (FDA) approved product is TAVALISSE ® (fostamatinib disodium hexahydrate), the only oral spleen tyrosine kinase (SYK) inhibitor, for the treatment of adult patients with chronic immune thrombocytopenia (ITP) who have had an insufficient response to a previous treatment. The marketing authorization application (MAA) for fostamatinib has been approved by the European Commission (EC) in Europe for the treatment of chronic ITP in adult patients who are refractory to other treatments, and will be marketed in Europe under the name TAVLESSE ® (fostamatinib). Our clinical programs include a Phase 3 study of fostamatinib in warm autoimmune hemolytic anemia (AIHA); a recently completed Phase 1 study of R835, a proprietary molecule from our interleukin receptor associated kinase (IRAK 1/4) inhibitor program; and an ongoing Phase 1 study of R552, a proprietary molecule from our receptor-interacting protein kinase (RIP1) inhibitor program. In addition, we have product candidates in clinical development with partners BerGenBio ASA (BerGenBio), Daiichi Sankyo (Daiichi), Aclaris Therapeutics (Aclaris), and AstraZeneca AB (AZ). |
Use of estimates | Use of estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Significant estimates and assumptions made by management include those relating to revenue recognition on product sales and collaboration agreements, recoverability of our assets, including accounts receivables and inventories, stock-based compensation and the probability of achievement of corporate performance-based milestone for our performance-based stock option awards, impairment issues, the weighted average discount rate for our lease, estimated interest rate for our financing liability, the estimated useful life of assets, and estimated accruals, particularly research and development accruals, on an ongoing basis. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. To the extent there are material differences between these estimates and actual results, our financial statements will be affected. |
Inventories | Inventories Inventories are stated at the lower of cost or estimated net realizable value. We determine the cost of inventories using the standard cost method, which approximates actual cost based on a FIFO basis. Inventories consist primarily of third-party manufacturing costs and allocated internal overhead costs. We began capitalizing inventory costs associated with our product upon regulatory approval when, based on management’s judgment, future commercialization was considered probable and the future economic benefit was expected to be realized. Prior to FDA approval of TAVALISSE, all manufacturing costs were charged to research and development expense in the period incurred. At December 31, 2019, our physical inventory included active pharmaceutical product of which costs have been previously charged to research and development expense. However, manufacturing of drug product, finished bottling and other labeling activities that occurred post FDA approval are included in the inventory value at December 31, 2019. We record write-downs for potential excess, dated or obsolete inventories based on an analysis of forecasted demand compared to quantities on hand and any firm purchase orders, as well as product shelf life. |
Cost of Product Sales | Cost of Product Sales Cost of product sales consists of third-party manufacturing costs, transportation and freight, and indirect overhead costs associated with the manufacture and distribution of TAVALISSE. A portion of the cost of producing the product sold to date was expensed as research and development prior to the NDA approval for TAVALISSE and therefore is not included in the cost of product sales during this period. |
Accounts Receivable | Accounts Receivable Accounts receivable are recorded net of customer allowances for prompt payment discounts and any allowance for doubtful accounts. We estimate the allowance for doubtful accounts based on existing contractual payment terms, actual payment patterns of its customers and individual customer circumstances. As of December 31, 2019 and 2018, we have determined that an allowance for doubtful accounts is not required. |
Revenue Recognition | Revenue Recognition We recognize revenue in accordance with ASC Topic 606, Revenue From Contracts with Customers (ASC 606) , when our customer obtains control of promised goods or services, in an amount that reflects the consideration which we expect to receive in exchange for those goods or services. To determine whether arrangements are within the scope of ASC 606, we perform the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies its performance obligation. We apply the five-step model to contracts when it is probable that the we will collect the consideration we are entitled to in exchange for the goods or services we transfer to the customer. At contract inception, once the contract is determined to be within the scope of this new guidance, we assess the goods or services promised within each contract and identify, as a performance obligation, and assess whether each promised good or service is distinct. We then recognize as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Product Sales Revenues from product sales are recognized when the Specialty Distributors (SDs), who are our customers, obtain control of our product, which occurs at a point in time, upon delivery to such SDs. These SDs subsequently resell our products to specialty pharmacy providers, health care providers, hospitals and clinics. In addition to distribution agreements with these SDs, we also enter into arrangements with specialty pharmacy providers, in-office dispensing providers, group purchasing organizations, and government entities that provide for government-mandated and/or privately-negotiated rebates, chargebacks and discounts with respect to the purchase of our products. Under ASC 606, we are required to estimate the transaction price, including variable consideration that is subject to a constraint, in our contracts with our customers. Variable considerations are included in the transaction price to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur. Revenue from product sales are recorded net of certain variable considerations which includes estimated government-mandated rebates and chargebacks, distribution fees, estimated product returns and other deductions. Provisions for returns and other adjustments are provided for in the period the related revenue is recorded. Actual amounts of consideration ultimately received may differ from our estimates. If actual results in the future vary from our estimates, we will adjust these estimates, which would affect net product revenue and earnings in the period such variances become known. The following are our significant categories of sales discounts and allowances: Sales Discounts . We provide our customers prompt payment discounts that are explicitly stated in our contracts and are recorded as a reduction of revenue in the period the related product revenue is recognized. Product Returns. We offer our SDs a right to return product purchased directly from us, which is principally based upon the product’s expiration date. Product return allowances are estimated and recorded at the time of sale. Government Rebates: We are subject to discount obligations under the state Medicaid programs, Tricare program and Medicare prescription drug coverage gap program. We estimate our Medicaid and Medicare prescription drug coverage gap rebates based upon a range of possible outcomes that are probability-weighted for the estimated payor mix. These reserves are recorded in the same period the related revenue is recognized, resulting in a reduction of product revenue and the establishment of a current liability that is included as part of Other Accrued Liabilities account in the Balance Sheet. Our liability for these rebates consists primarily of estimates of claims for the current quarter, and estimated future claims that will be made for product that has been recognized as revenue, but remains in the distribution channel inventories at the end of each reporting period. Chargebacks and Discounts: Chargebacks for fees and discounts represent the estimated obligations resulting from contractual commitments to sell products to certain specialty pharmacy providers, in-office dispensing providers, group purchasing organizations, and government entities at prices lower than the list prices charged to our SDs who directly purchase the product from us. These SDs charge us for the difference between what they pay for the product and our contracted selling price to these specialty pharmacy providers, in-office dispensing providers, group purchasing organizations, and government entities. These reserves are established in the same period that the related revenue is recognized, resulting in a reduction of product revenue. Actual chargeback amounts are generally determined at the time of resale to the specialty pharmacy providers, in-office dispensing providers, group purchasing organizations, and government entities by our SDs. The estimated obligations arising from these chargebacks and discounts are included as part of Other Accrued Liabilities in the balance sheet. Co-Payment Assistance: We offer co-payment assistance to commercially insured patients meeting certain eligibility requirements. The calculation of the accrual for co-pay assistance is based on an estimated number of claims and the cost per claim that we expect to receive associated with product that has been recognized as revenue. Contract Revenues from Collaborations In the normal course of business, we conduct research and development programs independently and in connection with our corporate collaborators, pursuant to which we license certain rights to our intellectual property to third parties. The terms of these arrangements typically include payment to us for a combination of one or more of the following: upfront license fees; development, regulatory and commercial milestone payments; product supply services; and royalties on net sales of licensed products. Upfront License Fees: If the license to our intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, we recognize revenues from upfront license fees allocated to the license when the license is transferred to the licensee and the licensee is able to use and benefit from the license. For licenses that are bundled with other promises, we determine whether the combined performance obligation is satisfied over time or at a point in time. If the combined performance obligation is satisfied over time, we use judgment in determining the appropriate method of measuring progress for purposes of recognizing revenue from the up-front license fees. We evaluate the measure of progress each reporting period and, if necessary, adjust the measure of performance and related revenue recognition. Development, Regulatory or Commercial Milestone Payments: At the inception of each arrangement that includes payments based on the achievement of certain development, regulatory and commercial or launch events, we evaluate whether the milestones are considered probable of being achieved and estimate the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within our or the licensee’s control, such as regulatory approvals, are not considered probable of being achieved until the uncertainty associated with the approvals has been resolved. The transaction price is then allocated to each performance obligation, on a relative standalone selling price basis, for which we recognize revenue as or when the performance obligations under the contract are satisfied. At the end of each subsequent reporting period, we re-evaluate the probability of achieving such development and regulatory milestones and any related constraint, and if necessary, adjust our estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, and recorded as part of contract revenues from collaborations during the period of adjustment. Product Supply Services: Arrangements that include a promise for future supply of drug product for either clinical development or commercial supply at the licensee’s discretion are generally considered as options. We assess if these options provide a material right to the licensee and if so, they are accounted for as separate performance obligations. Sales-based Milestone Payments and Royalties: For arrangements that include sales-based royalties, including milestone payments based on the volume of sales, we determine whether the license is deemed to be the predominant item to which the royalties or sales-based milestones relate to and if such is the case, we recognize revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). |
Stock award plans | Stock award plans On May 16, 2018, our stockholders approved the adoption of the Company’s 2018 Equity Incentive Plan (2018 Plan). The 2018 Plan is the successor plan to the 2011 Equity Incentive Plan, the 2000 Equity Incentive Plan, and the 2000 Non-Employee Directors' Stock Option Plan. As of December 31, 2019, we have two stock option plans, our 2018 Plan and the Inducement Plan (collectively, the Equity Incentive Plans), that provide for granting to our officers, directors and all other employees and consultants options to purchase shares of our common stock. We also have our Employee Stock Purchase Plan (Purchase Plan), wherein eligible employees can purchase shares of our common stock at a price per share equal to the lesser of 85% of the fair market value on the first day of the offering period or 85% of the fair market value on the purchase date. The fair value of each option award is estimated on the date of grant using the Black-Scholes option pricing model which considered our stock price, as well as assumptions regarding a number of complex and subjective variables. These variables include, but are not limited to, volatility, expected term, risk-free interest rate and dividends. We estimate volatility over the expected term of the option using historical share price performance. For expected term, we take into consideration our historical data of options exercised, cancelled and expired. The risk-free rate is based on the U.S. Treasury constant maturity rate. We have not paid and do not expect to pay dividends in the foreseeable future. We use the straight-line attribution method over the requisite employee service period for the entire award in recognizing stock-based compensation expense. We account for forfeitures as they occur. We granted performance-based stock options to purchase shares of our common stock which will vest upon the achievement of certain corporate performance-based milestones. We determined the fair values of these performance-based stock options using the Black-Scholes option pricing model at the date of grant. For the portion of the performance-based stock options of which the performance condition is considered probable of achievement, we recognize stock-based compensation expense on the related estimated grant date fair values of such options on a straight-line basis from the date of grant up to the date when we expect the performance condition will be achieved. For the performance conditions that are not considered probable of achievement at the grant date or upon quarterly re-evaluation, prior to the event actually occurring, we recognize the related stock-based compensation expense when the event occurs or when we can determine that the performance condition is probable of achievement. In those cases, we recognize the change in estimate at the time we determine the condition is probable of achievement (by recognizing stock-based compensation expense as cumulative catch-up adjustment as if we had estimated at the grant date that the performance condition would have been achieved) and recognize the remaining compensation cost up to the date when we expect the performance condition will be achieved, if any. |
Cash, cash equivalents and short-term investments | Cash, cash equivalents and short-term investments We consider all highly liquid investments in debt securities with maturity from the date of purchase of 90 days or less to be cash equivalents. Cash equivalents consist of money market funds, U.S. treasury bills, corporate bonds and commercial paper and investments in government‑sponsored enterprises. Our short-term investments include U.S. treasury bills, obligations of government‑ sponsored enterprises and corporate bonds and commercial paper. By policy, we limit the concentration of credit risk by diversifying our investments among a variety of high credit‑quality issuers. We view our short-term investments portfolio as available for use in current operations. Accordingly, we have classified certain securities as short-term investments on our balance sheet even though the stated maturity date of these securities may be more than one year from the current balance sheet date. All cash equivalents and short‑term investments are classified as available‑for‑sale securities. Available‑for‑sale securities are carried at fair value at December 31, 2019 and 2018. Unrealized gains (losses) are reported in the statements of stockholders’ equity and comprehensive loss. Fair value is estimated based on available market information or valuation methodologies. The cost of securities sold is based on the specific identification method. See Note 7 for a summary of available-for-sale securities at December 31, 2019 and 2018. |
Fair value of financial instruments | Fair value of financial instruments The carrying values of cash, accounts receivable, prepaid and other current assets, accounts payable and accrued liabilities approximate fair value due to the short-term maturity of those instruments. Cash equivalents and short-term investments are carried at fair value at December 31, 2019 and 2018. |
Concentration of credit risk | Concentration of credit risk Financial instruments that potentially subject us to concentrations of credit risk are primarily cash and cash equivalents, short-term investments and accounts receivable. Cash equivalents and short-term investments primarily consist of money market funds, U.S. treasury bills, government-sponsored enterprise securities, and corporate bonds and commercial paper. Due to the short-term nature of these investments, we believe we do not have a material exposure to credit risk arising from our investments. All cash and cash equivalents and short-term investments are maintained with financial institutions that management believes are creditworthy. Concentrations of credit risk with respect to accounts receivable are limited due to our limited number of customers. |
Property and equipment | Property and equipment Property and equipment are stated at cost. Depreciation is calculated using the straight‑line method over the estimated useful lives of the assets, which range from three to seven years. |
Research and development expenses | Research and development expenses Research and development expenses include costs for scientific personnel, supplies, equipment, consultants, research sponsored by us, allocated facility costs, costs related to pre‑clinical and clinical trials, including raw materials, and stock‑based compensation expense. All such costs are charged to research and development expense as incurred and at the time raw materials are purchased. |
Research and development accruals | Research and development accruals We have various contracts with third parties related to our research and development activities. Costs that are incurred but not billed to us as of the end of the period are accrued. We make estimates of the amounts incurred in each period based on the information available to us and our knowledge of the nature of the contractual activities generating such costs. Clinical trial contract expenses are accrued based on units of activity. Expenses related to other research and development contracts, such as research contracts, toxicology study contracts and manufacturing contracts are estimated to be incurred generally on a straight-line basis over the duration of the contracts. Raw materials and study materials not related to our approved drug, purchased for us by third parties are expensed at the time of purchase. |
Leases | Leases We currently lease our research and office space under a noncancelable lease agreement with our landlord through January 2023. In December 2014, we entered into a sublease agreement with an unrelated third party to occupy a portion of our research and office space through January 2023. We adopted ASU No. 2018-11, Leases (Topic 842) : Targeted Improvements as of January 1, 2019. Pursuant to Topic 842, all of our leases outstanding on January 1, 2019 continued to be classified as operating leases. With the adoption of Topic 842, we recorded an operating lease right-of-use asset and an operating lease liability on our balance sheet. Right-of-use lease assets represent our right to use the underlying asset for the lease term and the lease obligation represents our commitment to make the lease payments arising from the lease. Right-of-use lease assets and obligations are recognized at the commencement date based on the present value of remaining lease payments over the lease term. As our lease does not provide an implicit rate, we have used an estimated incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The operating lease right-of-use asset includes any lease payments made prior to commencement. The lease term may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Operating lease expense is recognized on a straight-line basis over the lease term, subject to any changes in the lease or expectations regarding the terms. Variable lease costs such as common area costs and property taxes are expensed as incurred. Leases with an initial term of 12 months or less are not recorded on the balance sheet. For our sublease agreement wherein we are the lessor, sublease income will be recognized on a straight-line basis over the term of the sublease. The difference between the cash received, and the straight-line lease income recognized, if any, will be recorded as part of prepaid and other current assets in the balance sheet. Prior to our adoption of Topic 842, we recorded a deferred rent asset or liability equal to the difference between the rent expense and the future minimum lease payments due. We recorded lease expense on a straight‑line basis for our lease, net of sublease income, wherein such arrangements contain scheduled rent increases over the term of the lease and sublease, respectively. |
Income taxes | Income taxes We use the asset and liability method to account for income taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities from a change in tax rates is recognized in income in the period the change is enacted. A valuation allowance is established to reduce deferred tax assets to an amount whose realization is more likely than not. |
Net loss per share | Net loss per share Basic net loss per share is computed by dividing net loss by the weighted‑average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by dividing net loss by the weighted‑average number of shares of common stock outstanding during the period and the number of additional shares of common stock that would have been outstanding if potentially dilutive securities had been issued. Potentially dilutive securities include warrant and stock options and shares issuable under our Purchase Plan. The dilutive effect of these potentially dilutive securities is reflected in diluted earnings per share by application of the treasury stock method. Under the treasury stock method, an increase in the fair market value of our common stock can result in a greater dilutive effect from potentially dilutive securities. The following table sets forth the computation of basic and diluted net loss per share (in thousands, except per share amounts): Year Ended December 31, 2019 2018 2017 EPS Numerator: Net loss $ $ $ EPS Denominator—Basic and Diluted: Weighted-average common shares outstanding 167,400 160,529 126,324 Net loss per common share: Basic and diluted $ (0.40) $ (0.44) $ (0.62) During the periods presented, we had securities which could potentially dilute basic earnings per share, but were excluded from the computation of diluted net loss per share for all periods presented, as their effect would have been antidilutive. These securities consist of the following (in thousands except per share data): December 31, 2019 2018 2017 Outstanding stock options Weighted average exercise price of options $ $ $ |
Recent Accounting Pronouncements | Recent accounting pronouncements In February 2016, the FASB issued ASU No. 2016-02— Leases , (Topic 842) (ASU 2016-02), as amended, which generally requires lessees to recognize operating and financing lease liabilities and corresponding right-of-use assets on the balance sheet and to provide enhanced disclosures surrounding the amount, timing and uncertainty of cash flows arising from leasing arrangements. In July 2018, the FASB issued ASU No. 2018-11, Leases (Topic 842) : Targeted Improvements , or ASU No. 2018-11. In issuing ASU No. 2018-11, the FASB is permitting another transition method for ASU 2016-02, which allows the transition to the new lease standard by recognizing a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. We adopted this new standard on January 1, 2019 using a modified retrospective approach and elected the transition method and the package of practical expedients permitted under the transition guidance, which allowed us to carryforward our historical lease classification and our assessment on whether a contract is or contains a lease. We also elected to combine lease and non-lease components, such as common area maintenance charges, as single lease, and elected to use the short-term lease exception permitted by the standard. As a result of the adoption of Topic 842 on January 1, 2019, we recognized $32.8 million in operating right-of-use asset and $33.2 million in lease liability, and derecognized $399,000 of deferred rent in the balance sheet at adoption date. These were calculated using the present value of our remaining lease payments using an estimated incremental borrowing rate of 9%. There was no cumulative-effect adjustment on our accumulated deficit as of January 1, 2019. For our sublease agreement wherein we are the lessor, the same practical expedients apply to both lessor and lessee. Therefore , the sublease is classified as an operating lease under Topic 842. Further, the adoption of Topic 842 did not have an impact on our sublease on the date of adoption as all the expected In June 2018, the FASB issued ASU 2018-07— Compensation-Stock Compensation Improvements to Nonemployee Share-Based Payment Accounting (Topic 718) . This standard substantially aligns accounting for share-based payments to employees and non-employees. This standard is effective for annual periods beginning after December 15, 2018, including interim periods within that period, and early adoption is permitted. We adopted this new standard on January 1, 2019 and our adoption did not have a material effect on our financial statements. In June 2016, the FASB issued ASU 2016-13— Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which represents a new credit loss standard that will change the impairment model for most financial assets and certain other financial instruments. Specifically, this guidance will require entities to utilize a new “expected loss” model as it relates to trade and other receivables. In addition, entities will be required to recognize an allowance for estimated credit losses on available-for-sale debt securities, regardless of the length of time that a security has been in an unrealized loss position. This guidance will be effective for annual reporting periods beginning after December 15, 2019, including interim periods within those annual reporting periods. We will adopt this new standard on January 1, 2020 and do not expect a material impact of this new standard on our financial statements and related disclosures. In August 2018, the FASB issued ASU 2018-13 —Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement (ASU 2018-13) , which modifies the disclosure requirements on fair value measurements. This guidance is effective for fiscal years beginning after December 15, 2019, and interim periods therein. We will adopt this new standard on January 1, 2020 and do not expect a material impact of this new standard on our financial statements and related disclosures. In November 2018, the FASB issued ASU 2018-18— Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606 . This standard provides guidance on the interaction between Revenue Recognition (Topic 606) and Collaborative Arrangements (Topic 808) by aligning the unit of account guidance between the two topics and clarifying whether certain transactions between collaborative participants should be accounted for as revenue under Topic 606. ASU 2018-18 is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. We will adopt this new standard on January 1, 2020 and do not expect a material impact of this new standard on our financial statements and related disclosures. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of computation of basic and diluted net loss per share | The following table sets forth the computation of basic and diluted net loss per share (in thousands, except per share amounts): Year Ended December 31, 2019 2018 2017 EPS Numerator: Net loss $ $ $ EPS Denominator—Basic and Diluted: Weighted-average common shares outstanding 167,400 160,529 126,324 Net loss per common share: Basic and diluted $ (0.40) $ (0.44) $ (0.62) |
Schedule of antidilutive securities | These securities consist of the following (in thousands except per share data): December 31, 2019 2018 2017 Outstanding stock options Weighted average exercise price of options $ $ $ |
REVENUES (Tables)
REVENUES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
REVENUES | |
Schedule of revenues disaggregated by category | Revenues disaggregated by category were as follows (in thousands): December 31, 2019 2018 2017 Product sales: Gross product sales $ $ 16,953 $ — Discounts and allowances (9,310) (3,006) — Product sales, net $ 43,772 $ 13,947 $ — Revenues from collaborations: License revenues $ 30,562 250 Development milestones 5,500 — 4,234 Research and development services and others 1,320 — — Total revenues from collaborations 15,516 30,562 4,484 Total revenues $ 59,288 $ 44,509 $ 4,484 |
Customer revenues (as a percentage of gross revenues) | The following table summarizes revenues from each of our customers who individually accounted for 10% or more of our gross revenues (as a percentage of gross revenues): December 31, 2019 2018 2017 ASD Healthcare and Oncology Supply — McKesson Specialty Care Distribution Corporation — Kissei — — BerGenBio — — |
Schedule of product revenue allowances and discounts | The following tables summarize activity in each of the product revenue allowances and discounts during the year ended December 31, 2019 (in thousands): Chargebacks, Government Discounts and and Other Fees Rebates Returns Total Balance at January 1, 2019 $ 623 $ 843 $ 170 $ 1,636 Provision related to current period sales 5,170 2,864 99 8,133 Credit or payments made during the period (4,500) (1,906) (31) (6,437) Balance at December 31, 2019 $ 1,293 $ 1,801 $ 238 $ 3,332 Chargebacks, Government Discounts and and Other Fees Rebates Returns Total Balance at January 1, 2018 $ — $ — $ — $ — Provision related to current period sales 1,484 1,068 170 2,722 Credit or payments made during the period (861) (225) — (1,086) Balance at December 31, 2018 $ 623 $ 843 $ 170 $ 1,636 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
INVENTORIES | |
Schedule of Inventories | The following table summarizes inventories, net as of December 31, 2019 and 2018 (in thousands): December 31, 2019 2018 Work in process $ $ 530 Finished goods 364 Total $ 1,354 $ 894 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
STOCK-BASED COMPENSATION | |
Schedule of stock-based compensation related to all of the entity's share-based payments | Total stock‑based compensation expense related to all of our stock‑based awards was as follows (in thousands): Year Ended December 31, 2019 2018 2017 Selling, general and administrative $ 6,453 $ 5,383 $ 4,490 Research and development 2,662 2,321 1,497 Total stock-based compensation expense $ 9,115 $ 7,704 $ 5,987 |
Summary of weighted-average assumptions relating to options granted pursuant to equity incentive plans | Year Ended December 31, 2019 2018 2017 Risk-free interest rate % % % Expected term (in years) Dividend yield % % % Expected volatility % % % |
Schedule of option activity under equity incentive plans | Weighted- Average Remaining Shares Available Number of Shares Weighted-Average Contractual Term Aggregate For Grant Underlying Options Exercise Price (in years) Intrinsic Value Outstanding at January 1, 2019 15,097,014 20,713,331 $ 4.20 Authorized for grant 3,544,984 — Granted (7,457,575) 7,457,575 $ 2.03 Exercised — (68,654) $ 2.05 Cancelled 5,431,548 (5,431,548) $ 4.16 Outstanding at December 31, 2019 16,615,971 22,670,704 $ 3.51 6.15 $ 809,459 Vested and expected to vest at December 31, 2019 22,363,204 $ 3.51 Exercisable at December 31, 2019 15,804,733 $ 3.97 5.10 $ 243,612 |
Schedule of stock options by exercise price | Details of our stock options by exercise price are as follows as of December 31, 2019: Options Outstanding Options Exercisable Number of Weighted-Average Outstanding Remaining Weighted-Average Number of Weighted-Average Exercise Price Options Contractual Life (in years) Exercise Price Options Exercise Price $1.68 - $1.96 479,134 9.51 $ 1.95 10,834 $ 1.68 $2.00 - $2.00 4,426,817 8.57 2.00 821,292 2.00 $2.02 - $2.14 3,814,210 5.97 2.11 3,433,546 2.12 $2.21 - $2.74 3,621,639 6.88 2.52 2,590,664 2.62 $2.76 - $3.80 3,231,670 5.83 3.50 2,676,557 3.50 $3.84 - $4.49 3,777,761 6.48 4.32 2,952,367 4.31 $4.53 - $9.62 3,319,473 1.63 7.50 3,319,473 7.50 $1.68 - $9.62 22,670,704 6.13 3.51 15,804,733 3.97 |
Summary of weighted-average assumptions used to calculate fair value of purchase rights granted under Employee Stock Purchase Plan | Year Ended December 31, 2019 2018 2017 Risk-free interest rate 2.7 % 2.4 % 0.5 % Expected term (in years) 1.5 1.3 1.5 Dividend yield % % % Expected volatility 62.6 % 66.2 % 63.1 % |
CASH, CASH EQUIVALENTS AND SH_2
CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS | |
Schedule of cash, cash equivalents and short-term investments | Cash, cash equivalents and short-term investments consist of the following (in thousands): December 31, 2019 2018 Cash $ 3,371 $ 2,626 Money market funds 7,457 9,106 U.S. treasury bills 12,539 — Government-sponsored enterprise securities 19,017 7,872 Corporate bonds and commercial paper 55,694 108,933 $ 98,078 $ 128,537 Reported as: Cash and cash equivalents $ 22,521 $ 76,322 Short-term investments 75,557 52,215 $ 98,078 $ 128,537 |
Schedule of cash equivalents and short-term investments including the securities with unrealized gains and losses | Cash equivalents and short-term investments included the following securities with gross unrealized gains and losses (in thousands): Gross Gross Amortized Unrealized Unrealized December 31, 2019 Cost Gains Losses Fair Value U.S. treasury bills $ 12,532 $ 8 $ (1) $ 12,539 Government-sponsored enterprise securities $ 19,010 $ 8 $ (1) $ 19,017 Corporate bonds and commercial paper 55,685 14 (5) 55,694 Total $ 87,227 $ 30 $ (7) $ 87,250 |
Schedule of contractual maturities of cash equivalents and short-term investments | Gross Gross Amortized Unrealized Unrealized December 31, 2018 Cost Gains Losses Fair Value Government-sponsored enterprise securities $ 7,873 $ — $ (1) $ 7,872 Corporate bonds and commercial paper 108,957 2 (26) 108,933 Total $ 116,830 $ 2 $ (27) $ 116,805 |
Schedule of fair value and gross unrealized losses of the entity's investments in unrealized loss position | The following table shows the fair value and gross unrealized losses of our investments in individual securities that are in an unrealized loss position, aggregated by investment category (in thousands): December 31, 2019 Fair Value Unrealized Losses U. S. treasury bills $ 4,512 $ (1) Government-sponsored enterprise securities 8,009 (1) Corporate bonds and commercial paper 18,731 (5) Total $ 31,252 $ (7) |
FAIR VALUE (Tables)
FAIR VALUE (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
FAIR VALUE | |
Schedule of financial assets measured at fair value on a recurring basis | Financial assets measured at fair value on a recurring basis are categorized in the tables below based upon the lowest level of significant input to the valuations (in thousands): Assets at Fair Value as of December 31, 2019 Level 1 Level 2 Level 3 Total Money market funds $ 7,457 $ — $ — $ 7,457 U.S. treasury bills — 12,539 — 12,539 Government-sponsored enterprise securities — 19,017 — 19,017 Corporate bonds and commercial paper — 55,694 — 55,694 Total $ 7,457 $ 87,250 $ — $ 94,707 Assets at Fair Value as of December 31, 2018 Level 1 Level 2 Level 3 Total Money market funds $ 9,106 $ — $ — $ 9,106 Government-sponsored enterprise securities — 7,872 — 7,872 Corporate bonds and commercial paper — 108,933 — 108,933 Total $ 9,106 $ 116,805 $ — $ 125,911 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
PROPERTY AND EQUIPMENT | |
Schedule of property and equipment | Property and equipment consists of the following (in thousands): December 31, 2019 2018 Laboratory equipment $ $ Computer and software 1,622 Furniture and equipment 1,391 1,403 Fixed assets in progress — Total property and equipment 15,204 Less accumulated depreciation and amortization Property and equipment, net $ 2,159 $ |
LEASE AGREEMENTS (Tables)
LEASE AGREEMENTS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
LEASE AGREEMENTS | |
Schedule of changes in liability related to sublease agreement | The changes in the liability related to the sublease agreement during the years ended December 31, 2018 and 2017 were as follows (in thousands): Balance at January 1, 2017 $ 3,460 Increase in deferred liability 495 Accretion of deferred liability 157 Amortization of deferred liability (3,828) Balance at December 31, 2017 284 Accretion of deferred liability 2 Amortization of deferred liability (286) Balance at December 31, 2018 $ — |
Schedule of components of operating lease expense | For the year ended December 31, 2019, the components of our operating lease expense was as follows (in thousands): Year Ended December 31, 2019 Fixed operating lease expense $ 5,248 Variable operating lease expense 745 Total operating lease expense $ 5,993 |
Schedule of cash flow information related to operating lease | Supplemental information related to our operating lease for the years ended December 31, 2019 was as follows (in thousands): Cash payments included in the measurement of operating lease liabilities $ 9,321 Right-of-use asset obtained in exchange for operating lease obligations — |
Schedule of operating sublease information | For the year ended December 31, 2019, we have the following operating sublease information (in thousands): Year Ended December 31, 2019 Fixed sublease expense $ 4,381 Variable sublease expense 829 Sublease income (5,210) Net $ — |
Schedule of future minimum lease payments and obligations | At December 31, 2019, future minimum lease payments and obligations under our noncancelable operating lease, net of expected sublease receipts, were as follows (in thousands): Operating Sublease For years ending December 31, Lease Receipts Net 2020 $ 9,694 $ (4,360) $ 5,334 2021 10,082 (4,534) 5,548 2022 10,485 (4,716) 5,769 2023 877 (394) 483 Total minimum payments required $ 31,138 $ (14,004) $ 17,134 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
INCOME TAXES | |
Schedule of components of the entity's deferred tax assets | Significant components of our deferred tax assets are as follows (in thousands): December 31, 2019 2018 Deferred tax assets Net operating loss carryforwards $ $ Orphan drug and research and development credits Deferred compensation Lease liabilities — Capitalized research and development expenses Other, net Deferred tax liabilities Operating lease right-of-use asset — Total net deferred tax assets Less: valuation allowance Deferred tax assets, net of allowance $ — $ — |
Schedule of reconciliation of the statutory federal income tax rate to the effective tax rate | Year Ended December 31, 2019 2018 2017 Federal statutory tax rate (21.0) % (21.0) % (34.0) % Federal statutory rate reduction — % — % 160.2 % State, Net of Federal Benefit 0.1 % — % — % Valuation allowance 21.7 % 16.3 % (126.5) % Stock compensation 2.8 % 8.2 % 5.7 % Orphan drug and research and development credits (5.1) % (3.7) % (3.6) % Other, net 1.5 % 0.2 % (1.8) % Effective tax rate % % % |
Schedule of activity related to the entity's gross unrecognized tax benefits | The following table summarizes the activity related to our gross unrecognized tax benefits (in thousands): Year Ended December 31, 2019 2018 Balance at the beginning of the year $ 7,849 $ 7,430 Increase related to current year tax positions 509 419 Balance at the end of the year $ 8,358 $ 7,849 |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
DEBT | |
Schedule of future minimum payments | Year Ending December 31, 2021 $ 556 2022 3,333 2023 3,333 2024 2,778 Principal amount (initial tranche) $ 10,000 |
SELECTED QUARTERLY FINANCIAL _2
SELECTED QUARTERLY FINANCIAL DATA (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
SELECTED QUARTERLY FINANCIAL DATA | |
Schedule of selected quarterly financial data | Year Ended December 31, 2019 Year Ended December 31, 2018 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 (unaudited, in thousands, except per share amounts) Revenue $ 12,624 $ 10,407 $ 20,857 $ 15,400 $ — $ 1,787 $ 4,865 $ 37,857 Gross profit* $ 7,947 $ 9,862 $ 11,406 $ 13,651 $ — $ 1,757 $ 4,796 $ 7,107 Net loss $ (17,598) $ (20,606) $ (11,490) $ (17,200) $ (24,385) $ (25,557) $ (23,766) $ 3,228 Net income (loss) per share, basic and diluted: $ (0.11) $ (0.12) $ (0.07) $ (0.10) $ (0.17) $ (0.16) $ (0.14) $ 0.02 Weighted average shares used in computing net income (loss) per share: Basic 167,173 167,191 167,609 167,619 147,114 161,577 166,464 166,680 Diluted 167,173 167,191 167,609 167,745 147,114 161,577 166,464 167,617 * |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Stock Award Plans (Details) | 12 Months Ended |
Dec. 31, 2019plan | |
Stock Based Compensation | |
Number of stock option plans | 2 |
Purchase Plan | |
Stock Based Compensation | |
Purchase price of common shares as a percentage of the fair market value on the first day of the offering period | 85.00% |
Purchase price of common shares as a percentage of the fair market value on the purchase date | 85.00% |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Minimum | |
Property and equipment | |
Estimated useful life | 3 years |
Maximum | |
Property and equipment | |
Estimated useful life | 7 years |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Net Loss per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
EPS Numerator: | |||||||||||
Net loss | $ (17,200) | $ (11,490) | $ (20,606) | $ (17,598) | $ 3,228 | $ (23,766) | $ (25,557) | $ (24,385) | $ (66,894) | $ (70,480) | $ (77,992) |
EPS Denominator - Basic and Diluted: | |||||||||||
Weighted-average common shares outstanding | 167,400 | 160,529 | 126,324 | ||||||||
Net loss per common share: | |||||||||||
Basic and diluted (in dollars per share) | $ (0.10) | $ (0.07) | $ (0.12) | $ (0.11) | $ 0.02 | $ (0.14) | $ (0.16) | $ (0.17) | $ (0.40) | $ (0.44) | $ (0.62) |
Weighted Average | |||||||||||
Net loss per common share: | |||||||||||
Weighted average exercise price of options (in dollars per share) | $ 3.51 | $ 4.20 | $ 3.51 | $ 4.20 | $ 5.45 | ||||||
Employee stock option | |||||||||||
Net loss per common share: | |||||||||||
Antidilutive securities excluded from computation of earnings per share (in shares) | 22,671 | 20,713 | 20,408 |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Recent Accounting Pronouncements (Details) - USD ($) | Jan. 01, 2019 | Dec. 31, 2019 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Right-of-use assets | $ 25,709,000 | |
Lease liability | $ 27,000,000 | |
Accounting Standards Update 2016-02 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Right-of-use assets | $ 32,800,000 | |
Lease liability | 33,200,000 | |
Derecognized deferred rent | $ 399,000 | |
Estimated incremental borrowing rate for estimation of present value of lease payments | 9.00% | |
Cumulative-effect adjustment on accumulated deficit | $ 0 |
REVENUES - Disaggregated (Detai
REVENUES - Disaggregated (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Disaggregation of Revenue [Line Items] | ||||||||||
Total revenues | $ 15,400 | $ 20,857 | $ 10,407 | $ 12,624 | $ 37,857 | $ 4,865 | $ 1,787 | $ 59,288 | $ 44,509 | $ 4,484 |
Gross product sales | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Total revenues | 53,082 | 16,953 | ||||||||
Discounts and allowances | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Total revenues | (9,310) | (3,006) | ||||||||
Product sales, net | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Total revenues | 43,772 | 13,947 | ||||||||
License revenues | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Total revenues | 8,696 | 30,562 | 250 | |||||||
Development milestones | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Total revenues | 5,500 | 4,234 | ||||||||
Research and development services and others | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Total revenues | 1,320 | |||||||||
Contract revenues from collaborations | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Total revenues | $ 15,516 | $ 30,562 | 4,484 | |||||||
TAVALISSE | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Total revenues | $ 0 |
REVENUES - Percentage by Custom
REVENUES - Percentage by Customer (Details) - Sales - Customer concentration risk | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
ASD Healthcare and Oncology Supply | |||
Disaggregation of Revenue [Line Items] | |||
Percentage | 37.00% | 17.00% | |
McKesson Specialty Care Distribution Corporation | |||
Disaggregation of Revenue [Line Items] | |||
Percentage | 30.00% | 11.00% | |
Kissei | |||
Disaggregation of Revenue [Line Items] | |||
Percentage | 3.00% | 69.00% | |
BerGenBio | |||
Disaggregation of Revenue [Line Items] | |||
Percentage | 74.00% |
REVENUES - Activity (Details)
REVENUES - Activity (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items] | ||
Balance | $ 1,636,000 | |
Provision related to current period sales | 8,133,000 | 2,722,000 |
Credit or payments made during the period | (6,437,000) | (1,086,000) |
Balance | 3,332,000 | 1,636,000 |
Discounts and allowances | 9,300,000 | 3,000,000 |
Other accrued liabilities | 6,721,000 | 3,598,000 |
Accounts receivable and prepaid and other current assets | ||
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items] | ||
Provision related to current period sales | 1,200,000 | 285,000 |
Chargebacks, Discounts and Fees | ||
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items] | ||
Balance | 623,000 | |
Provision related to current period sales | 5,170,000 | 1,484,000 |
Credit or payments made during the period | (4,500,000) | (861,000) |
Balance | 1,293,000 | 623,000 |
Government and Other Rebates | ||
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items] | ||
Balance | 843,000 | |
Provision related to current period sales | 2,864,000 | 1,068,000 |
Credit or payments made during the period | (1,906,000) | (225,000) |
Balance | 1,801,000 | 843,000 |
Returns | ||
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items] | ||
Balance | 170,000 | |
Provision related to current period sales | 99,000 | 170,000 |
Credit or payments made during the period | (31,000) | |
Balance | $ 238,000 | $ 170,000 |
REVENUES - Accounts Receivable
REVENUES - Accounts Receivable (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Accounts receivable | $ 10,111 | $ 4,077 |
Allowance for doubtful accounts | 0 | $ 0 |
Aclaris | ||
Accounts receivable | $ 1,500 |
SPONSORED RESEARCH AND LICENS_2
SPONSORED RESEARCH AND LICENSE AGREEMENTS (Details) - USD ($) | Dec. 31, 2019 | Jan. 31, 2020 | Dec. 31, 2019 | Oct. 31, 2019 | Sep. 30, 2019 | Jan. 31, 2019 | Oct. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 |
Collaborations | |||||||||
Accounts receivable | $ 10,111,000 | $ 10,111,000 | $ 10,111,000 | $ 4,077,000 | |||||
Collaborative arrangement | |||||||||
Collaborations | |||||||||
Contingent payments | 631,700,000 | ||||||||
Specified Development Events | Collaborative arrangement | |||||||||
Collaborations | |||||||||
Contingent payments | 90,500,000 | ||||||||
Specified Regulatory Events | Collaborative arrangement | |||||||||
Collaborations | |||||||||
Contingent payments | 165,200,000 | ||||||||
Specified Product Launch Events | Collaborative arrangement | |||||||||
Collaborations | |||||||||
Contingent payments | 376,000,000 | ||||||||
Grifols | |||||||||
Collaborations | |||||||||
Upfront payment received | $ 30,000,000 | ||||||||
Deferred revenue | 25,300,000 | 25,300,000 | 25,300,000 | ||||||
Revenue, remaining performance obligations | 5,000,000 | 5,000,000 | 5,000,000 | ||||||
Grifols | Research and Regulatory Services Performed and License Right | |||||||||
Collaborations | |||||||||
Revenue recognized | 4,700,000 | ||||||||
Grifols | Commercial Milestones | |||||||||
Collaborations | |||||||||
Contingent payments | 297,500,000 | ||||||||
Kissei | |||||||||
Collaborations | |||||||||
Upfront payment received | $ 33,000,000 | ||||||||
Contingent payments | 147,000,000 | ||||||||
Revenue recognized | $ 30,600,000 | ||||||||
Revenue, remaining performance obligations | $ 33,000,000 | ||||||||
Aclaris | |||||||||
Collaborations | |||||||||
Collaborative payment received | $ 4,000,000 | ||||||||
Revenue recognized | 4,000,000 | ||||||||
Accounts receivable | 1,500,000 | $ 1,500,000 | 1,500,000 | ||||||
Celgene | |||||||||
Collaborations | |||||||||
Collaborative payment received | $ 3,800,000 | ||||||||
Revenue recognized | 3,800,000 | ||||||||
fostamatinib | Grifols | |||||||||
Collaborations | |||||||||
Markup percentage | 30.00% | ||||||||
fostamatinib | Grifols | Terminated agreement upon prior written notice within six months after second anniversary of agreement | |||||||||
Collaborations | |||||||||
Contingent upfront fee, refund requirement | 25,000,000 | ||||||||
fostamatinib | Grifols | Creditable advance royalty payment | |||||||||
Collaborations | |||||||||
Upfront payment received | 2,500,000 | ||||||||
fostamatinib | Grifols | Upon EMA approval of fostamatinib for treatment of chronic ITP | |||||||||
Collaborations | |||||||||
Upfront payment received | $ 17,500,000 | ||||||||
fostamatinib | Grifols | Maximum | |||||||||
Collaborations | |||||||||
Royalty payment as a percentage of net sales | 30.00% | ||||||||
fostamatinib | Kissei | |||||||||
Collaborations | |||||||||
Revenue recognized | 1,600,000 | ||||||||
Deferred revenue | $ 1,400,000 | $ 1,400,000 | $ 1,400,000 | ||||||
fostamatinib | Medison Pharma | Financing arrangement | |||||||||
Collaborations | |||||||||
Upfront payment received | 5,000,000 | ||||||||
fostamatinib | Medison Pharma | Commercial and license agreements | |||||||||
Collaborations | |||||||||
Number of agreements | $ 2 | ||||||||
Subsequent events | fostamatinib | Grifols | |||||||||
Collaborations | |||||||||
Collaborative payment received | $ 20,000,000 | ||||||||
Subsequent events | fostamatinib | Grifols | Creditable advance royalty payment | |||||||||
Collaborations | |||||||||
Collaborative payment received | 2,500,000 | ||||||||
Subsequent events | fostamatinib | Grifols | EMA approval of fostamatinib | |||||||||
Collaborations | |||||||||
Collaborative payment received | $ 17,500,000 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
INVENTORIES | ||
Work in process | $ 810,000 | $ 530,000 |
Finished goods | 544,000 | 364,000 |
Total | 1,354,000 | $ 894,000 |
Advance payments for raw materials | $ 3,000,000 |
SIGNIFICANT CONCENTRATIONS (Det
SIGNIFICANT CONCENTRATIONS (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019USD ($)Distributorcustomeritem | Dec. 31, 2018USD ($)Distributorcustomeritem | Dec. 31, 2017 | |
SIGNIFICANT CONCENTRATIONS | |||
Accounts receivable | $ 10,111 | $ 4,077 | |
Aclaris | |||
SIGNIFICANT CONCENTRATIONS | |||
Accounts receivable | $ 1,500 | ||
Sales | Customer concentration risk | |||
SIGNIFICANT CONCENTRATIONS | |||
Number of specialty distributors | Distributor | 3 | 3 | |
Sales | Customer concentration risk | Three specialty distributors | |||
SIGNIFICANT CONCENTRATIONS | |||
Concentration risk as a percentage | 74.00% | 31.00% | |
Sales | Customer concentration risk | Aclaris | |||
SIGNIFICANT CONCENTRATIONS | |||
Concentration risk as a percentage | 9.00% | ||
Sales | Customer concentration risk | Grifols | |||
SIGNIFICANT CONCENTRATIONS | |||
Concentration risk as a percentage | 8.00% | ||
Sales | Customer concentration risk | Celgene | |||
SIGNIFICANT CONCENTRATIONS | |||
Concentration risk as a percentage | 6.00% | 26.00% | |
Sales | Customer concentration risk | Kissei | |||
SIGNIFICANT CONCENTRATIONS | |||
Concentration risk as a percentage | 3.00% | 69.00% | |
Sales | Customer concentration risk | BerGenBio | |||
SIGNIFICANT CONCENTRATIONS | |||
Concentration risk as a percentage | 74.00% | ||
Sales | Customer concentration risk | ASD Healthcare and Oncology Supply | |||
SIGNIFICANT CONCENTRATIONS | |||
Concentration risk as a percentage | 37.00% | 17.00% | |
Sales | Customer concentration risk | McKesson Specialty Care Distribution Corporation | |||
SIGNIFICANT CONCENTRATIONS | |||
Concentration risk as a percentage | 30.00% | 11.00% | |
Accounts receivable | Credit concentration risk | Four customers | |||
SIGNIFICANT CONCENTRATIONS | |||
Number of customers | customer | 4 | 4 | |
Accounts receivable | Credit concentration risk | Four customers and one collaboration partner | |||
SIGNIFICANT CONCENTRATIONS | |||
Concentration risk as a percentage | 100.00% | 100.00% | |
Accounts receivable | Credit concentration risk | One collaboration partner | |||
SIGNIFICANT CONCENTRATIONS | |||
Number of collaboration partners | item | 1 | 1 |
STOCK-BASED COMPENSATION (Detai
STOCK-BASED COMPENSATION (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Stock-based compensation expense related to stock-based awards | |||
Total stock-based compensation expense | $ 9,115 | $ 7,704 | $ 5,987 |
Incremental stock-based compensation expense | 1,400 | ||
Selling, general and administrative | |||
Stock-based compensation expense related to stock-based awards | |||
Total stock-based compensation expense | 6,453 | 5,383 | 4,490 |
Research and development | |||
Stock-based compensation expense related to stock-based awards | |||
Total stock-based compensation expense | $ 2,662 | $ 2,321 | $ 1,497 |
STOCK-BASED COMPENSATION - Empl
STOCK-BASED COMPENSATION - Employee Stock Option Plans (Details) | 12 Months Ended |
Dec. 31, 2019planshares | |
STOCK-BASED COMPENSATION | |
Number of stock option plans | plan | 2 |
Number of shares of common stock authorized (in shares) | 22,670,704 |
Employee stock option | |
STOCK-BASED COMPENSATION | |
Expiration period | 10 years |
Options exercised during the period (in shares) | 68,654 |
2018 Equity Incentive Plan | Employee stock option | |
STOCK-BASED COMPENSATION | |
Expiration period | 10 years |
Number of shares of common stock authorized (in shares) | 38,114,675 |
Inducement Plan | Employee stock option | |
STOCK-BASED COMPENSATION | |
Number of shares of common stock authorized (in shares) | 1,172,000 |
Inducement Plan | Employee stock option | Maximum | |
STOCK-BASED COMPENSATION | |
Expiration period | 10 years |
STOCK-BASED COMPENSATION - Assu
STOCK-BASED COMPENSATION - Assumptions and Activity (Details) | 12 Months Ended | ||||
Dec. 31, 2019USD ($)item$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | Dec. 31, 2019USD ($)$ / sharesshares | Dec. 31, 2018USD ($)shares | |
Stock Based Compensation | |||||
Number of homogenous groups for purposes of determining fair values of options | item | 3 | ||||
Share-based compensation | $ | $ 9,115,000 | $ 7,704,000 | $ 5,987,000 | ||
Shares Available For Grant | |||||
Outstanding at the end of the period (in shares) | 16,615,971 | ||||
Additional disclosures | |||||
Shares of common stock available for grant | 16,615,971 | 16,615,971 | |||
Shares reserved for future issuance | 22,670,704 | ||||
Purchase Plan | |||||
Weighted-average assumptions relating to options granted | |||||
Risk-free interest rate (as a percent) | 2.70% | 2.40% | 0.50% | ||
Expected term (in years) | 1 year 6 months | 1 year 3 months 18 days | 1 year 6 months | ||
Dividend yield (as a percent) | 0.00% | 0.00% | 0.00% | ||
Expected volatility (as a percent) | 62.60% | 66.20% | 63.10% | ||
Employee stock option | |||||
Stock Based Compensation | |||||
Contractual term of the option | 10 years | ||||
Weighted-average assumptions relating to options granted | |||||
Risk-free interest rate (as a percent) | 2.40% | 2.70% | 2.20% | ||
Expected term (in years) | 6 years 6 months | 6 years 8 months 12 days | 6 years 7 months 6 days | ||
Dividend yield (as a percent) | 0.00% | 0.00% | 0.00% | ||
Expected volatility (as a percent) | 65.50% | 65.10% | 63.50% | ||
Shares Available For Grant | |||||
Outstanding at the beginning of the period (in shares) | 15,097,014 | ||||
Authorized for grant (in shares) | 3,544,984 | ||||
Granted (in shares) | (7,457,575) | (4,594,225) | (4,048,675) | ||
Cancelled (in shares) | 5,431,548 | ||||
Outstanding at the end of the period (in shares) | 16,615,971 | 15,097,014 | |||
Number of Shares Underlying Options | |||||
Outstanding at the beginning of the period (in shares) | 20,713,331 | ||||
Granted (in shares) | 7,457,575 | 4,594,225 | 4,048,675 | ||
Exercised (in shares) | (68,654) | ||||
Cancelled (in shares) | (5,431,548) | ||||
Outstanding at the end of the period (in shares) | 22,670,704 | 20,713,331 | |||
Vested and expected to vest (in shares) | 22,363,204 | ||||
Exercisable (in shares) | 15,804,733 | ||||
Weighted Average Exercise Price | |||||
Outstanding at the beginning of the period (in dollars per share) | $ / shares | $ 4.20 | ||||
Granted (in dollars per share) | $ / shares | 2.03 | ||||
Exercised (in dollars per share) | $ / shares | 2.05 | ||||
Cancelled (in dollars per share) | $ / shares | 4.16 | ||||
Outstanding at the end of the period (in dollars per share) | $ / shares | $ 3.51 | $ 4.20 | |||
Vested and expected to vest (in dollars per share) | $ / shares | $ 3.51 | ||||
Exercisable (in dollars per share) | $ / shares | $ 3.97 | ||||
Weighted Average Remaining Contractual Term (in years) | |||||
Outstanding at the end of the period | 6 years 1 month 24 days | ||||
Exercisable | 5 years 1 month 6 days | ||||
Aggregate Intrinsic Value | |||||
Outstanding at the end of the period (in dollars) | $ | $ 809,459,000 | ||||
Exercisable | $ | $ 243,612,000 | ||||
Number of nonvested stock options (in shares) | 6,865,971 | 5,962,769 | |||
Intrinsic value of nonvested stock options | $ | $ 614,000 | $ 121,000 | |||
Aggregate intrinsic value of options exercised | $ | $ 12,000 | $ 1,300,000 | |||
Weighted-average recognition period of unamortized compensation cost | 2 years 3 months 18 days | 4 months 24 days | |||
Number of shares vested | 4,442,936 | 2,924,823 | |||
Weighted-average exercise price for shares vested during the period (in dollars per share) | $ / shares | $ 3.26 | $ 2.88 | |||
Additional disclosures | |||||
Options cancelled (in shares) | 5,431,548 | ||||
Options outstanding at the end of the period (in shares) | 22,670,704 | 20,713,331 | 22,670,704 | 20,713,331 | |
Grant-date weighted-average fair value (in dollars per share) | $ / shares | $ 1.27 | $ 2.66 | $ 1.48 | ||
Total unrecognized compensation costs | $ | $ 8,900,000 | ||||
Shares of common stock available for grant | 16,615,971 | 15,097,014 | 16,615,971 | 15,097,014 | |
Options exercised during the period (in shares) | 68,654 | ||||
Employee stock option | Consultant | |||||
Stock Based Compensation | |||||
Contractual term of the option | 10 years | ||||
Employee stock option | Purchase Plan | |||||
Aggregate Intrinsic Value | |||||
Unrecognized compensation cost related to purchase plan | $ | $ 475,000,000,000 | ||||
Performance shares | |||||
Shares Available For Grant | |||||
Granted (in shares) | (307,500) | ||||
Number of Shares Underlying Options | |||||
Granted (in shares) | 307,500 | ||||
Performance shares | Vesting upon achievement of corporate performance-based milestones | |||||
Additional disclosures | |||||
Total unrecognized compensation costs | $ | $ 363,000 |
STOCK-BASED COMPENSATION - Stoc
STOCK-BASED COMPENSATION - Stock Options by Exercise Price (Details) - Employee stock option | 12 Months Ended |
Dec. 31, 2019$ / sharesshares | |
$1.68 - $1.96 | |
Stock options by exercise price | |
Range of exercise prices, low end of the range (in dollars per share) | $ 1.68 |
Range of exercise prices, high end of the range (in dollars per share) | $ 1.96 |
Options Outstanding | |
Number of Shares Underlying Options (in shares) | shares | 479,134 |
Weighted-Average Remaining Contractual Life | 9 years 6 months 4 days |
Weighted-Average Exercise Price (in dollars per share) | $ 1.95 |
Options Exercisable | |
Number of Shares Underlying Options (in shares) | shares | 10,834 |
Weighted Average Exercise Price (in dollars per share) | $ 1.68 |
$2.00 - $2.00 | |
Stock options by exercise price | |
Range of exercise prices, low end of the range (in dollars per share) | 2 |
Range of exercise prices, high end of the range (in dollars per share) | $ 2 |
Options Outstanding | |
Number of Shares Underlying Options (in shares) | shares | 4,426,817 |
Weighted-Average Remaining Contractual Life | 8 years 6 months 26 days |
Weighted-Average Exercise Price (in dollars per share) | $ 2 |
Options Exercisable | |
Number of Shares Underlying Options (in shares) | shares | 821,292 |
Weighted Average Exercise Price (in dollars per share) | $ 2 |
$2.02 - $2.14 | |
Stock options by exercise price | |
Range of exercise prices, low end of the range (in dollars per share) | 2.02 |
Range of exercise prices, high end of the range (in dollars per share) | $ 2.14 |
Options Outstanding | |
Number of Shares Underlying Options (in shares) | shares | 3,814,210 |
Weighted-Average Remaining Contractual Life | 5 years 11 months 19 days |
Weighted-Average Exercise Price (in dollars per share) | $ 2.11 |
Options Exercisable | |
Number of Shares Underlying Options (in shares) | shares | 3,433,546 |
Weighted Average Exercise Price (in dollars per share) | $ 2.12 |
$2.21 - $2.74 | |
Stock options by exercise price | |
Range of exercise prices, low end of the range (in dollars per share) | 2.21 |
Range of exercise prices, high end of the range (in dollars per share) | $ 2.74 |
Options Outstanding | |
Number of Shares Underlying Options (in shares) | shares | 3,621,639 |
Weighted-Average Remaining Contractual Life | 6 years 10 months 17 days |
Weighted-Average Exercise Price (in dollars per share) | $ 2.52 |
Options Exercisable | |
Number of Shares Underlying Options (in shares) | shares | 2,590,664 |
Weighted Average Exercise Price (in dollars per share) | $ 2.62 |
$2.76 - $3.80 | |
Stock options by exercise price | |
Range of exercise prices, low end of the range (in dollars per share) | 2.76 |
Range of exercise prices, high end of the range (in dollars per share) | $ 3.80 |
Options Outstanding | |
Number of Shares Underlying Options (in shares) | shares | 3,231,670 |
Weighted-Average Remaining Contractual Life | 5 years 9 months 29 days |
Weighted-Average Exercise Price (in dollars per share) | $ 3.50 |
Options Exercisable | |
Number of Shares Underlying Options (in shares) | shares | 2,676,557 |
Weighted Average Exercise Price (in dollars per share) | $ 3.50 |
$3.84 - $4.49 | |
Stock options by exercise price | |
Range of exercise prices, low end of the range (in dollars per share) | 3.84 |
Range of exercise prices, high end of the range (in dollars per share) | $ 4.49 |
Options Outstanding | |
Number of Shares Underlying Options (in shares) | shares | 3,777,761 |
Weighted-Average Remaining Contractual Life | 6 years 5 months 23 days |
Weighted-Average Exercise Price (in dollars per share) | $ 4.32 |
Options Exercisable | |
Number of Shares Underlying Options (in shares) | shares | 2,952,367 |
Weighted Average Exercise Price (in dollars per share) | $ 4.31 |
$4.53 - $9.62 | |
Stock options by exercise price | |
Range of exercise prices, low end of the range (in dollars per share) | 4.53 |
Range of exercise prices, high end of the range (in dollars per share) | $ 9.62 |
Options Outstanding | |
Number of Shares Underlying Options (in shares) | shares | 3,319,473 |
Weighted-Average Remaining Contractual Life | 1 year 7 months 17 days |
Weighted-Average Exercise Price (in dollars per share) | $ 7.50 |
Options Exercisable | |
Number of Shares Underlying Options (in shares) | shares | 3,319,473 |
Weighted Average Exercise Price (in dollars per share) | $ 7.50 |
$1.68 - $9.62 | |
Stock options by exercise price | |
Range of exercise prices, low end of the range (in dollars per share) | 1.68 |
Range of exercise prices, high end of the range (in dollars per share) | $ 9.62 |
Options Outstanding | |
Number of Shares Underlying Options (in shares) | shares | 22,670,704 |
Weighted-Average Remaining Contractual Life | 6 years 1 month 17 days |
Weighted-Average Exercise Price (in dollars per share) | $ 3.51 |
Options Exercisable | |
Number of Shares Underlying Options (in shares) | shares | 15,804,733 |
Weighted Average Exercise Price (in dollars per share) | $ 3.97 |
STOCK-BASED COMPENSATION - Em_2
STOCK-BASED COMPENSATION - Employee Stock Purchase Plan (Details) - Purchase Plan | 12 Months Ended | ||
Dec. 31, 2019USD ($)$ / sharesshares | Dec. 31, 2018$ / sharesshares | Dec. 31, 2017$ / sharesshares | |
Stock Based Compensation | |||
Purchase price expressed as a percentage of fair market value of common stock on the first day of the offering period | 85.00% | ||
Purchase price expressed as a percentage of fair market value of common stock on the purchase date | 85.00% | ||
Number of shares of common stock issued | shares | 747,691 | 783,984 | 403,302 |
Average price of shares issued (in dollars per share) | $ / shares | 1.92 | 1.92 | 1.87 |
Weighted average fair value of stock purchased (in dollars per share) | $ / shares | $ 1.07 | $ 1.27 | $ 0.99 |
Number of shares of common stock available for future issuance | shares | 583,893 | ||
Award offering period | 24 months | ||
Total incremental fair value for the Purchase Plan reset | $ | $ 753,000 |
CASH, CASH EQUIVALENTS AND SH_3
CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS (Details) | 12 Months Ended | |||
Dec. 31, 2019USD ($)item | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
Cash, cash equivalent and short term investments | ||||
Cash and cash equivalents | $ 22,521,000 | $ 76,322,000 | $ 38,290,000 | $ 17,632,000 |
Short-term Investments | 75,557,000 | 52,215,000 | ||
Cash, cash equivalents and short-term investments | 98,078,000 | 128,537,000 | ||
Available-For-Sale Securities Reconciliation | ||||
Amortized Cost | 87,227,000 | 116,830,000 | ||
Fair Value | $ 87,250,000 | 116,805,000 | ||
Weighted-average time to maturity of cash equivalents and available-for-sale securities | 117 days | |||
Number of investments in continuous unrealized loss position for more than 12 months | 0 | |||
Fair value and gross unrealized losses of investments in individual securities in unrealized loss position | ||||
Number of individual securities in unrealized loss position for 12 months or less | item | 19 | |||
Fair Value | $ 31,252,000 | |||
Unrealized Losses | (7,000) | |||
Money market funds | ||||
Cash, cash equivalent and short term investments | ||||
Cash, cash equivalents and short-term investments | 7,457,000 | 9,106,000 | ||
U.S. treasury bills | ||||
Cash, cash equivalent and short term investments | ||||
Cash, cash equivalents and short-term investments | 12,539,000 | |||
Available-For-Sale Securities Reconciliation | ||||
Amortized Cost | 12,532,000 | |||
Fair Value | 12,539,000 | |||
Fair value and gross unrealized losses of investments in individual securities in unrealized loss position | ||||
Fair Value | 4,512,000 | |||
Unrealized Losses | (1,000) | |||
Government-sponsored enterprises securities | ||||
Cash, cash equivalent and short term investments | ||||
Cash, cash equivalents and short-term investments | 19,017,000 | 7,872,000 | ||
Available-For-Sale Securities Reconciliation | ||||
Amortized Cost | 19,010,000 | 7,873,000 | ||
Fair Value | 19,017,000 | 7,872,000 | ||
Fair value and gross unrealized losses of investments in individual securities in unrealized loss position | ||||
Fair Value | 8,009,000 | |||
Unrealized Losses | (1,000) | |||
Corporate bonds and commercial paper | ||||
Cash, cash equivalent and short term investments | ||||
Cash, cash equivalents and short-term investments | 55,694,000 | 108,933,000 | ||
Available-For-Sale Securities Reconciliation | ||||
Amortized Cost | 55,685,000 | 108,957,000 | ||
Fair Value | 55,694,000 | 108,933,000 | ||
Fair value and gross unrealized losses of investments in individual securities in unrealized loss position | ||||
Fair Value | 18,731,000 | |||
Unrealized Losses | (5,000) | |||
Gross Unrealized Gains | ||||
Available-For-Sale Securities Reconciliation | ||||
Gross Unrealized Gains (Losses) | 30,000 | 2,000 | ||
Gross Unrealized Gains | U.S. treasury bills | ||||
Available-For-Sale Securities Reconciliation | ||||
Gross Unrealized Gains (Losses) | 8,000 | |||
Gross Unrealized Gains | Government-sponsored enterprises securities | ||||
Available-For-Sale Securities Reconciliation | ||||
Gross Unrealized Gains (Losses) | 8,000 | |||
Gross Unrealized Gains | Corporate bonds and commercial paper | ||||
Available-For-Sale Securities Reconciliation | ||||
Gross Unrealized Gains (Losses) | 14,000 | 2,000 | ||
Gross Unrealized Losses | ||||
Available-For-Sale Securities Reconciliation | ||||
Gross Unrealized Gains (Losses) | (7,000) | (27,000) | ||
Gross Unrealized Losses | U.S. treasury bills | ||||
Available-For-Sale Securities Reconciliation | ||||
Gross Unrealized Gains (Losses) | (1,000) | |||
Gross Unrealized Losses | Government-sponsored enterprises securities | ||||
Available-For-Sale Securities Reconciliation | ||||
Gross Unrealized Gains (Losses) | (1,000) | (1,000) | ||
Gross Unrealized Losses | Corporate bonds and commercial paper | ||||
Available-For-Sale Securities Reconciliation | ||||
Gross Unrealized Gains (Losses) | (5,000) | (26,000) | ||
Cash | ||||
Cash, cash equivalent and short term investments | ||||
Cash, cash equivalents and short-term investments | $ 3,371,000 | $ 2,626,000 |
FAIR VALUE (Details)
FAIR VALUE (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value | ||
Investments at fair value | $ 87,250 | $ 116,805 |
U.S. treasury bills | ||
Fair Value | ||
Investments at fair value | 12,539 | |
Government-sponsored enterprises securities | ||
Fair Value | ||
Investments at fair value | 19,017 | 7,872 |
Corporate bonds and commercial paper | ||
Fair Value | ||
Investments at fair value | 55,694 | 108,933 |
Fair value measurements recurring | Estimate Of Fair Value Fair Value Disclosure | ||
Fair Value | ||
Investments at fair value | 94,707 | 125,911 |
Fair value measurements recurring | Money market funds | Estimate Of Fair Value Fair Value Disclosure | ||
Fair Value | ||
Investments at fair value | 7,457 | 9,106 |
Fair value measurements recurring | U.S. treasury bills | Estimate Of Fair Value Fair Value Disclosure | ||
Fair Value | ||
Investments at fair value | 12,539 | |
Fair value measurements recurring | Government-sponsored enterprises securities | Estimate Of Fair Value Fair Value Disclosure | ||
Fair Value | ||
Investments at fair value | 19,017 | 7,872 |
Fair value measurements recurring | Corporate bonds and commercial paper | Estimate Of Fair Value Fair Value Disclosure | ||
Fair Value | ||
Investments at fair value | 55,694 | 108,933 |
Fair value measurements recurring | Fair value inputs Level 1 | ||
Fair Value | ||
Investments at fair value | 7,457 | 9,106 |
Fair value measurements recurring | Fair value inputs Level 1 | Money market funds | ||
Fair Value | ||
Investments at fair value | 7,457 | 9,106 |
Fair value measurements recurring | Fair value inputs Level 2 | ||
Fair Value | ||
Investments at fair value | 87,250 | 116,805 |
Fair value measurements recurring | Fair value inputs Level 2 | U.S. treasury bills | ||
Fair Value | ||
Investments at fair value | 12,539 | |
Fair value measurements recurring | Fair value inputs Level 2 | Government-sponsored enterprises securities | ||
Fair Value | ||
Investments at fair value | 19,017 | 7,872 |
Fair value measurements recurring | Fair value inputs Level 2 | Corporate bonds and commercial paper | ||
Fair Value | ||
Investments at fair value | $ 55,694 | $ 108,933 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
PROPERTY AND EQUIPMENT | |||
Total property and equipment | $ 15,204,000 | $ 14,241,000 | |
Less accumulated depreciation and amortization | (13,045,000) | (12,854,000) | |
Property and equipment, net | 2,159,000 | 1,387,000 | |
Assets disposed | 496,000 | 18,000 | |
Depreciation and amortization | 683,000 | 594,000 | $ 465,000 |
Laboratory equipment | |||
PROPERTY AND EQUIPMENT | |||
Total property and equipment | 11,627,000 | 11,317,000 | |
Computer and software | |||
PROPERTY AND EQUIPMENT | |||
Total property and equipment | 1,622,000 | 1,521,000 | |
Furniture and equipment | |||
PROPERTY AND EQUIPMENT | |||
Total property and equipment | 1,391,000 | $ 1,403,000 | |
Fixed assets in progress | |||
PROPERTY AND EQUIPMENT | |||
Total property and equipment | $ 564,000 |
LEASE AGREEMENTS (Details)
LEASE AGREEMENTS (Details) | Jan. 01, 2019USD ($) | Dec. 31, 2019USD ($)item | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Feb. 28, 2017ft² | Dec. 31, 2014ft² |
Sublease Agreement | ||||||
Number of lease renewal periods | item | 2 | |||||
Lease renewal term (in years) | 5 years | |||||
Area of real estate property (square feet) | ft² | 9,328 | 57,000 | ||||
Expected income from sublease | $ 14,000,000 | |||||
Beginning Balance | $ 284,000 | $ 3,460,000 | ||||
Increase in deferred liability | 495,000 | |||||
Accretion of deferred liability | 2,000 | 157,000 | ||||
Amortization of deferred liability | (286,000) | (3,828,000) | ||||
Ending Balance | $ 284,000 | |||||
Right-of-use assets | 25,709,000 | |||||
Lease liability | $ 27,000,000 | |||||
Weighted average remaining lease term | 3 years 29 days | |||||
Accounting Standards Update 2016-02 | ||||||
Sublease Agreement | ||||||
Right-of-use assets | 32,800,000 | |||||
Lease liability | 33,200,000 | |||||
Derecognized deferred rent | $ 399,000 | |||||
Estimated incremental borrowing rate for estimation of present value of lease payments | 9.00% | |||||
Cumulative-effect adjustment on accumulated deficit | $ 0 |
LEASE AGREEMENTS - Lease Expens
LEASE AGREEMENTS - Lease Expense (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
LEASE AGREEMENTS | |
Fixed operating lease expense | $ 5,248 |
Variable operating lease expense | 745 |
Total operating lease expense | $ 5,993 |
LEASE AGREEMENTS - Cash Flow In
LEASE AGREEMENTS - Cash Flow Information (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
LEASE AGREEMENTS | |
Cash payments included in the measurement of operating lease liabilities | $ 9,321 |
LEASE AGREEMENTS - Sublease Inf
LEASE AGREEMENTS - Sublease Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Operating sublease information | |||
Fixed sublease expense | $ 4,381 | ||
Variable sublease expense | 829 | ||
Sublease income | $ (5,210) | $ (5,100) | $ (8,000) |
LEASE AGREEMENTS - Future Minim
LEASE AGREEMENTS - Future Minimum Lease Payments (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Operating Lease | |
2020 | $ 9,694 |
2021 | 10,082 |
2022 | 10,485 |
2023 | 877 |
Total minimum payments required | 31,138 |
Sublease Receipts | |
2020 | (4,360) |
2021 | (4,534) |
2022 | (4,716) |
2023 | (394) |
Total minimum payments required | (14,004) |
Net | |
2020 | 5,334 |
2021 | 5,548 |
2022 | 5,769 |
2023 | 483 |
Total minimum payments required | $ 17,134 |
LEASE AGREEMENTS - Rent Expense
LEASE AGREEMENTS - Rent Expense, Net (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
LEASE AGREEMENTS | |||
Rent expense under operating lease | $ 6,000 | $ 6,000 | $ 6,900 |
Sublease income | $ 5,210 | $ 5,100 | $ 8,000 |
STOCKHOLDERS' EQUITY - Preferre
STOCKHOLDERS' EQUITY - Preferred Stock (Details) - shares | Dec. 31, 2019 | Dec. 31, 2018 |
Preferred Stock | ||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
STOCKHOLDERS' EQUITY - Common S
STOCKHOLDERS' EQUITY - Common Stock (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||
Jun. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2019 | May 18, 2018 | May 17, 2018 | |
Controlled Equity Offering | ||||||
Authorized number of shares of common stock | 400,000,000 | 400,000,000 | ||||
Aggregate proceeds | $ 67,162 | $ 114,180 | ||||
Common stock | ||||||
Controlled Equity Offering | ||||||
Authorized number of shares of common stock | 400,000,000 | 200,000,000 | ||||
Number of shares of common stock sold (in shares) | 18,400,000 | 18,400,000 | 45,981,093 | |||
Share price (in dollars per share) | $ 3.90 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Deferred tax assets | |||
Net operating loss carryforwards | $ 240,157 | $ 226,388 | |
Orphan drug and research and development credits | 59,603 | 55,276 | |
Deferred compensation | 8,817 | 7,155 | |
Lease liabilities | 6,989 | ||
Capitalized research and development expenses | 2,282 | 424 | |
Other, net | 529 | 809 | |
Deferred tax liabilities | |||
Operating lease right-of-use asset | (6,719) | ||
Total net deferred tax assets | 311,658 | 290,052 | |
Valuation allowance | (311,658) | (290,052) | |
Deferred tax assets, net of allowance | |||
Reconciliation of the statutory federal income tax rate to the effective tax rate | |||
Federal statutory tax rate (as a percent) | (21.00%) | (21.00%) | (34.00%) |
Federal statutory rate reduction | 160.20% | ||
State, Net of Federal Benefit | 0.10% | ||
Valuation allowance (as a percent) | 21.70% | 16.30% | (126.50%) |
Stock compensation (as a percent) | 2.80% | 8.20% | 5.70% |
Orphan drug and research and development credits | (5.10%) | (3.70%) | (3.60%) |
Other, net (as a percent) | 1.50% | 0.20% | (1.80%) |
Effective tax rate (as a percent) | 0.00% | 0.00% | 0.00% |
INCOME TAXES - Operating Loss C
INCOME TAXES - Operating Loss Carryforwards (Details) $ in Millions | Dec. 31, 2019USD ($) |
Federal jurisdiction | |
Operating loss carryforwards | |
Net operating loss carryforwards | $ 1,000 |
Federal jurisdiction | Expire beginning in the year 2020 | |
Operating loss carryforwards | |
Net operating loss carryforwards | 897.7 |
State jurisdiction | |
Operating loss carryforwards | |
Net operating loss carryforwards | $ 406.2 |
INCOME TAXES - Tax Credits (Det
INCOME TAXES - Tax Credits (Details) - Research $ in Millions | Dec. 31, 2019USD ($) |
Federal jurisdiction | |
Tax credit carryforward | |
Amount of tax credit carryforward | $ 43.8 |
State jurisdiction | |
Tax credit carryforward | |
Amount of tax credit carryforward | $ 29.5 |
INCOME TAXES - Valuation Allowa
INCOME TAXES - Valuation Allowance (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
INCOME TAXES | ||
Increase in valuation allowance | $ 21.6 | $ 8.4 |
INCOME TAXES - Unrecognized Tax
INCOME TAXES - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Gross unrecognized tax benefits | |||
Balance at the beginning of the year | $ 7,849 | $ 7,430 | |
Increase related to current year tax positions | 509 | 419 | |
Balance at the end of the year | 8,358 | 7,849 | $ 7,430 |
Unrecognized tax benefits, if recognized, would result in adjustments to other tax accounts, primarily deferred taxes | 7,200 | $ 6,800 | |
Tax positions subject to interest or penalties | $ 0 | ||
Federal statutory tax rate (as a percent) | 21.00% | 21.00% | 34.00% |
DEBT (Details)
DEBT (Details) | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Debt Instrument [Line Items] | |
Interest expense | $ 335,000 |
Credit Agreement | |
Debt Instrument [Line Items] | |
Maximum borrowing capacity | 60,000,000 |
Remaining borrowing capacity | 50,000,000 |
Debt issuance costs being amortized ratably | 211,000 |
Unamortized issuance costs and debt discounts | 191,000 |
Interest expense | 237,000 |
Accrued interest | 62,000 |
Outstanding balance | 9,800,000 |
Covenant, cash | $ 10,000,000 |
Final payment fee, percentage of principal | 2.50% |
Credit Agreement | Subject to achievement of certain customary conditions | |
Debt Instrument [Line Items] | |
Remaining borrowing capacity | $ 40,000,000 |
Credit Agreement | LIBOR | |
Debt Instrument [Line Items] | |
Basis spread on variable rate | 5.65% |
Floor rate | 1.50% |
Credit Agreement | as of September 27, 2019 | |
Debt Instrument [Line Items] | |
Maximum borrowing capacity | $ 10,000,000 |
Credit Agreement | until December 31, 2020 | |
Debt Instrument [Line Items] | |
Maximum borrowing capacity | 10,000,000 |
Credit Agreement | until March 31, 2021 | |
Debt Instrument [Line Items] | |
Maximum borrowing capacity | 20,000,000 |
Credit Agreement | until March 31, 2022 | |
Debt Instrument [Line Items] | |
Maximum borrowing capacity | $ 20,000,000 |
Credit Agreement | Initial interest-only payment period | |
Debt Instrument [Line Items] | |
Interest-only payments period | 24 months |
Credit Agreement | First conditional interest-only payment period | |
Debt Instrument [Line Items] | |
Interest-only payments period | 36 months |
Credit Agreement | Second conditional interest-only payment period | |
Debt Instrument [Line Items] | |
Interest-only payments period | 48 months |
DEBT - Future Minimum Payments
DEBT - Future Minimum Payments (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Future minimum payments | |
2021 | $ 556 |
2022 | 3,333 |
2023 | 3,333 |
2024 | 2,778 |
Principal amount (initial tranche) | $ 10,000 |
SELECTED QUARTERLY FINANCIAL _3
SELECTED QUARTERLY FINANCIAL DATA (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
SELECTED QUARTERLY FINANCIAL DATA | |||||||||||
Revenue | $ 15,400 | $ 20,857 | $ 10,407 | $ 12,624 | $ 37,857 | $ 4,865 | $ 1,787 | $ 59,288 | $ 44,509 | $ 4,484 | |
Gross profit | 13,651 | 11,406 | 9,862 | 7,947 | 7,107 | 4,796 | 1,757 | ||||
Net loss | $ (17,200) | $ (11,490) | $ (20,606) | $ (17,598) | $ 3,228 | $ (23,766) | $ (25,557) | $ (24,385) | $ (66,894) | $ (70,480) | $ (77,992) |
Net income (loss) per share: | |||||||||||
Basic and diluted (in dollars per share) | $ (0.10) | $ (0.07) | $ (0.12) | $ (0.11) | $ 0.02 | $ (0.14) | $ (0.16) | $ (0.17) | $ (0.40) | $ (0.44) | $ (0.62) |
Weighted average shares used in computing net income (loss) per share: | |||||||||||
Basic (in shares) | 167,619 | 167,609 | 167,191 | 167,173 | 166,680 | 166,464 | 161,577 | 147,114 | |||
Diluted (in shares) | 167,745 | 167,609 | 167,191 | 167,173 | 167,617 | 166,464 | 161,577 | 147,114 |
SUBSEQUENT EVENT (Details)
SUBSEQUENT EVENT (Details) - Subsequent events - fostamatinib - Grifols $ in Millions | 1 Months Ended |
Jan. 31, 2020USD ($) | |
Subsequent Event [Line Items] | |
Collaborative payment received | $ 20 |
Creditable advance royalty payment | |
Subsequent Event [Line Items] | |
Collaborative payment received | 2.5 |
EMA approval of fostamatinib | |
Subsequent Event [Line Items] | |
Collaborative payment received | $ 17.5 |