Cover Page
Cover Page - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2021 | Feb. 04, 2022 | Jun. 30, 2021 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2021 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 0-32405 | ||
Entity Registrant Name | SEAGEN INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 91-1874389 | ||
Entity Address, Address Line One | 21823 30th Drive SE | ||
Entity Address, City or Town | Bothell | ||
Entity Address, State or Province | WA | ||
Entity Address, Postal Zip Code | 98021 | ||
City Area Code | 425 | ||
Local Phone Number | 527-4000 | ||
Title of 12(b) Security | Common Stock, par value $0.001 | ||
Trading Symbol | SGEN | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 21 | ||
Entity Common Stock, Shares Outstanding | 183,626,064 | ||
Documents Incorporated by Reference | Part III incorporates information by reference from the registrant’s definitive proxy statement to be filed with the Securities and Exchange Commission pursuant to Regulation 14A, not later than 120 days after the end of the fiscal year covered by this Annual Report on Form 10-K, in connection with the registrant’s 2022 Annual Meeting of Stockholders. | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY | ||
Entity Central Index Key | 0001060736 |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2021 | |
Audit Information [Abstract] | |
Auditor Firm ID | 238 |
Auditor Name | PricewaterhouseCoopers LLP |
Auditor Location | Seattle, Washington |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 424,834 | $ 558,424 |
Short-term investments | 1,735,202 | 2,000,996 |
Accounts receivable, net | 389,256 | 324,988 |
Inventories | 200,663 | 116,136 |
Prepaid expenses and other current assets | 119,239 | 61,840 |
Total current assets | 2,869,194 | 3,062,384 |
Property and equipment, net | 210,073 | 196,700 |
Operating lease right-of-use assets | 57,889 | 61,480 |
Long-term investments | 0 | 100,830 |
Intangible assets, net | 260,593 | 283,680 |
Goodwill | 274,671 | 274,671 |
Other non-current assets | 47,184 | 21,161 |
Total assets | 3,719,604 | 4,000,906 |
Current liabilities: | ||
Accounts payable | 114,824 | 78,067 |
Accrued liabilities and other | 454,030 | 310,071 |
Total current liabilities | 568,854 | 388,138 |
Long-term liabilities: | ||
Operating lease liabilities, long-term | 56,665 | 61,884 |
Other long-term liabilities | 28,946 | 62,784 |
Total long-term liabilities | 85,611 | 124,668 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Preferred stock, $0.001 par value, 5,000 shares authorized; none issued | 0 | |
Common stock, $0.001 par value, 250,000 shares authorized; 183,381 shares issued and outstanding at December 31, 2021 and 180,902 shares issued and outstanding at December 31, 2020 | 183 | 181 |
Additional paid-in capital | 4,607,816 | 4,356,922 |
Accumulated other comprehensive income | 1,179 | 565 |
Accumulated deficit | (1,544,039) | (869,568) |
Total stockholders’ equity | 3,065,139 | 3,488,100 |
Total liabilities and stockholders’ equity | $ 3,719,604 | $ 4,000,906 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 250,000,000 | 250,000,000 |
Common stock, shares issued (in shares) | 183,381,000 | 180,902,000 |
Common stock, shares outstanding (in shares) | 183,381,000 | 180,902,000 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) shares in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Revenues: | |||
Revenue | $ 1,574,371,000 | $ 2,175,536,000 | $ 916,713,000 |
Costs and expenses: | |||
Cost of sales | 311,565,000 | 217,720,000 | 43,952,000 |
Research and development | 1,228,672,000 | 827,129,000 | 719,374,000 |
Selling, general and administrative | 716,190,000 | 533,835,000 | 373,932,000 |
Total costs and expenses | 2,256,427,000 | 1,578,684,000 | 1,137,258,000 |
(Loss) income from operations | (682,056,000) | 596,852,000 | (220,545,000) |
Investment and other income, net | 6,351,000 | 18,849,000 | 61,895,000 |
(Loss) income before income taxes | (675,705,000) | 615,701,000 | (158,650,000) |
(Benefit) provision for income taxes | (1,234,000) | 2,031,000 | 0 |
Net (loss) income | $ (674,471,000) | $ 613,670,000 | $ (158,650,000) |
Net (loss) income per share - basic (in dollars per share) | $ (3.70) | $ 3.51 | $ (0.96) |
Net (loss) income per share - diluted (in dollars per share) | $ (3.70) | $ 3.37 | $ (0.96) |
Shares used in computation of per share amounts - basic (in shares) | 182,048 | 174,834 | 165,498 |
Shares used in computation of per share amounts - diluted (in shares) | 182,048 | 182,287 | 165,498 |
Comprehensive (loss) income: | |||
Net (loss) income | $ (674,471,000) | $ 613,670,000 | $ (158,650,000) |
Other comprehensive income: | |||
Unrealized (loss) gain on securities available-for-sale, net of income tax provision of $0, $0, and $0, respectively | (211,000) | (186,000) | 204,000 |
Foreign currency translation gain, net of income tax provision of $0, $0, and $0, respectively | 825,000 | 522,000 | 65,000 |
Total other comprehensive income | 614,000 | 336,000 | 269,000 |
Comprehensive (loss) income | (673,857,000) | 614,006,000 | (158,381,000) |
Net product sales | |||
Revenues: | |||
Revenue | 1,385,566,000 | 1,000,598,000 | 627,977,000 |
Royalty revenues | |||
Revenues: | |||
Revenue | 150,523,000 | 126,756,000 | 138,491,000 |
Collaboration and license agreement revenues | |||
Revenues: | |||
Revenue | $ 38,282,000 | $ 1,048,182,000 | $ 150,245,000 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Statement [Abstract] | |||
Unrealized gain (loss) on securities available-for-sale, tax | $ 0 | $ 0 | $ 0 |
Foreign currency translation gain (loss), tax | $ 0 | $ 0 | $ 0 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Common stock | Additional paid-in capital | Accumulated other comprehensive income (loss) | Accumulated deficit |
Balances, shares (in shares) at Dec. 31, 2018 | 160,262 | ||||
Balances, value at Dec. 31, 2018 | $ 1,273,943 | $ 160 | $ 2,598,411 | $ (40) | $ (1,324,588) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net (loss) income | (158,650) | (158,650) | |||
Other comprehensive income | 269 | 269 | |||
Stock option exercises (in shares) | 2,621 | ||||
Issuance of common stock for stock option exercises and employee stock purchase plan | 89,151 | $ 3 | 89,148 | ||
Restricted stock vested during the period, net (in shares) | 897 | ||||
Restricted stock vested during the period, net | 0 | $ 1 | (1) | ||
Issuance of common stock (in shares) | 8,214 | ||||
Issuance of common stock | 548,691 | $ 8 | 548,683 | ||
Share-based compensation | 122,883 | 122,883 | |||
Balances, shares (in shares) at Dec. 31, 2019 | 171,994 | ||||
Balances, value at Dec. 31, 2019 | 1,876,287 | $ 172 | 3,359,124 | 229 | (1,483,238) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net (loss) income | 613,670 | 613,670 | |||
Other comprehensive income | 336 | 336 | |||
Stock option exercises (in shares) | 2,466 | ||||
Issuance of common stock for stock option exercises and employee stock purchase plan | 96,257 | $ 2 | 96,255 | ||
Restricted stock vested during the period, net (in shares) | 1,442 | ||||
Restricted stock vested during the period, net | 0 | $ 2 | (2) | ||
Issuance of common stock (in shares) | 5,000 | ||||
Issuance of common stock | 749,850 | $ 5 | 749,845 | ||
Share-based compensation | $ 151,700 | 151,700 | |||
Balances, shares (in shares) at Dec. 31, 2020 | 180,902 | 180,902 | |||
Balances, value at Dec. 31, 2020 | $ 3,488,100 | $ 181 | 4,356,922 | 565 | (869,568) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net (loss) income | (674,471) | (674,471) | |||
Other comprehensive income | 614 | 614 | |||
Stock option exercises (in shares) | 1,545 | ||||
Issuance of common stock for stock option exercises and employee stock purchase plan | 77,779 | $ 1 | 77,778 | ||
Restricted stock vested during the period, net (in shares) | 934 | ||||
Restricted stock vested during the period, net | 0 | $ 1 | (1) | ||
Share-based compensation | $ 173,117 | 173,117 | |||
Balances, shares (in shares) at Dec. 31, 2021 | 183,381 | 183,381 | |||
Balances, value at Dec. 31, 2021 | $ 3,065,139 | $ 183 | $ 4,607,816 | $ 1,179 | $ (1,544,039) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Operating activities: | |||
Net (loss) income | $ (674,471) | $ 613,670 | $ (158,650) |
Adjustments to reconcile net income (loss) to net cash provided (used) by operating activities | |||
Share-based compensation | 173,117 | 147,233 | 127,349 |
Depreciation and amortization | 42,854 | 36,045 | 23,759 |
Amortization of intangible assets | 23,087 | 16,345 | 15 |
Amortization of right-of-use-assets | 12,685 | 10,994 | 9,740 |
Amortization of premiums, accretion of discounts, and (gains) losses on debt securities | 15,933 | 3,104 | (4,916) |
Gain on equity securities | (4,744) | (11,604) | (50,124) |
(Gain) loss on disposals of property and equipment | 0 | (26) | 1,853 |
Deferred income taxes | 548 | (2,053) | 0 |
Changes in operating assets and liabilities: | |||
Accounts receivable, net | (64,268) | (88,727) | (89,720) |
Inventories | (84,527) | (30,204) | (32,693) |
Prepaid expenses and other assets | (66,422) | (22,231) | 2,459 |
Lease liabilities | (14,388) | (11,271) | (6,660) |
Deferred revenue | 0 | 0 | (33,600) |
Other liabilities | 141,589 | 195,293 | 47,451 |
Net cash (used) provided by operating activities | (499,007) | 856,568 | (163,737) |
Investing activities: | |||
Purchases of securities | (3,424,286) | (2,483,336) | (992,976) |
Proceeds from maturities of securities | 3,765,500 | 952,000 | 786,000 |
Proceeds from sales of securities | 0 | 194,733 | 0 |
Purchases of property and equipment | (52,330) | (82,409) | (70,753) |
Net cash provided (used) by investing activities | 288,884 | (1,419,012) | (277,729) |
Financing activities: | |||
Net proceeds from issuance of common stock | 0 | 749,850 | 548,691 |
Proceeds from exercise of stock options and employee stock purchase plan | 77,779 | 96,258 | 89,151 |
Net cash provided by financing activities | 77,779 | 846,108 | 637,842 |
Effect of exchange rate changes on cash and cash equivalents | (1,246) | 198 | 0 |
Net (decrease) increase in cash and cash equivalents | (133,590) | 283,862 | 196,376 |
Cash and cash equivalents at beginning of year | 558,424 | 274,562 | 78,186 |
Cash and cash equivalents at end of year | $ 424,834 | $ 558,424 | $ 274,562 |
Organization and Summary of Sig
Organization and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Organization and Summary of Significant Accounting Policies | Organization and Summary of Significant Accounting Policies Organization We are a biotechnology company that develops and commercializes targeted therapies to treat cancer. We are commercializing ADCETRIS®, or brentuximab vedotin, for the treatment of certain CD30-expressing lymphomas, PADCEV®, or enfortumab vedotin-ejfv, for the treatment of certain metastatic urothelial cancers, TIVDAK™, or tisotumab vedotin-tftv, for the treatment of certain metastatic cervical cancers, and TUKYSA®, or tucatinib, for treatment of certain metastatic HER2-positive breast cancers. We are also advancing a pipeline of novel therapies for solid tumors and blood-related cancers designed to address unmet medical needs and improve treatment outcomes for patients. Many of our programs, including ADCETRIS, PADCEV and TIVDAK, are based on our antibody-drug conjugate, or ADC, technology that utilizes the targeting ability of monoclonal antibodies to deliver cell-killing agents directly to cancer cells. Basis of presentation The accompanying consolidated financial statements reflect the accounts of Seagen Inc. and its wholly-owned subsidiaries (collectively “Seagen,” “we,” “our,” or “us”). The consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles, or GAAP. All intercompany transactions and balances have been eliminated. Management has determined that we operate in one segment: the development and sale of pharmaceutical products on our own behalf or in collaboration with others. Use of estimates The preparation of financial statements in accordance with GAAP requires us to make estimates, assumptions, and judgments that affect the amounts report ed in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. Estimates include those used for revenue recognition, valuation of investments, inventory valuation, accrued liabilities, including those related to the long-term incentive plans and performance-based equity, clinical trials and contingencies, and stock option valuation. Cash and cash equivalents We consider all highly liquid investments with maturities of three months or less at the date of acquisition to be cash equivalents. Non-cash activities We had $9.9 million and $6.0 million of accrued capital expenditures as of December 31, 2021 and 2020, respectively. Accrued capital expenditures have been treated as a non-cash investing activity and, accordingly, have not been included in the consolidated statement of cash flows until such amounts have been paid in cash. During the years ended December 31, 2021, 2020 and 2019, we recorded $9.1 million, $7.2 million, and $40.3 million, respectively, of right-of-use assets in exchange for lease liabilities, which has been treated as a non-cash operating activity. See Note 3 for additional information. Investments We hold certain equity securities which are reported at estimated fair value based on quoted market prices. Chang es in the fair value of equity securities are recorded in income or loss. The cost of equity securities for purposes of computing gains and losses is based on the specific identification method. We invest our available cash primarily in debt securities. These debt securities are classified as available-for-sale, which are reported at estimated fair value with unrealized gains and losses included in accumulated other comprehensive income (loss) in stockholders’ equity. Realized gains, realized losses and declines in the value of debt securities judged to be other-than-temporary are included in investment and other income, net. The cost of debt securities for purposes of computing realized and unrealized gains and losses is based on the specific identification method. Amortization of premiums and accretion of discounts on debt securities are included in investment and other income, net. Interest and dividends earned are included in investment and other income, net. Accrued interest receivable as of December 31, 2021 and 2020, were $0.4 million and $5.3 million, respectively, and were included in prepaid expenses and other current assets. We classify investments in debt securities maturing within one year of the reporting date, or where management’s intent is to use the investments to fund current operations or to make them available for current operations, as short-term investments. If the estimated fair value of a debt security is below its carrying value, we evaluate whether it is more likely than not that we will sell the security before its anticipated recovery in market value and whether evidence indicating that the cost of the investment is recoverable within a reasonable period of time outweighs evidence to the contrary. We also evaluate whether or not we intend to sell the investment. If the impairment is considered to be other-than-temporary, the security is written down to its estimated fair value. In addition, we consider whether credit losses exist for any securities. A credit loss exists if the present value of cash flows expected to be collected is less than the amortized cost basis of the security. Other-than-temporary declines in estimated fair value and credit losses are included in investment and other income, net. Fair value of financial instruments The recorded amounts of certain financial instruments, including cash and cash equivalents, interest receivable, accounts receivable, accounts payable and accrued liabilities approximate fair value due to their relatively short maturities. Investments that are classified as available-for-sale are recorded at estimated fair value. The estimated fair value for securities held is determined using quoted market prices, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency. Leases We determine if an arrangement is a lease at inception d ate. All of our currently effective leases are classified as operating leases. Operating lease liabilities and the corresponding right-of-use assets are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. The operating lease right-of-use asset also excludes lease incentives and initial direct costs incurred. As our existing leases do not contain an implicit interest rate, we estimate our incremental borrowing rate based on information available a t commencement date in determining the present value of future payments. We include options to extend the lease in our lease liability and right-of-use asset when it is reasonably certain that we will exercise that option. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Variable lease cost primarily includes building operating expenses as charged to us by our landlords. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. For our short-term leases, we recognize lease payments as an expense on a straight-line base over the lease term. Inventories We consider regulatory approval of product candidates to be uncertain. Accordingly, we charge manufacturing costs to research and development expense until such time as a product has received regulatory approval for commercial sale. Production costs for our marketed products are capitalized into inventory. Inventory that is deployed for clinical, research or development use is charged to research and development expense when it is no longer available for commercial sales. Production costs for our other product candidates are charged to research and development expense. We value our inventories at the lower of cost or market value. Cost is determined on a specific identification basis. Inventory includes the cost of materials, third-party contract manufacturing and overhead associated with the production of our commercialized products. In the event that we identify excess, obsolete or unsalable inventory, its value is written down to net realizable value. Property and equipment Property and equipment are stated at cost. Land is not depreciated, while all other property and equipment are depreciated using the straight-line method over the estimated useful lives of the assets, which are generally as follows: Years Building and improvements 20-30 Laboratory and manufacturing equipment 5-15 Furniture and fixtures 5 Computers, software and office equipment 3 Leasehold improvements are amortized over the shorter of the remaining term of the applicable lease or the useful life of the asset. Gains and losses from the disposal of property and equipment are reflected in income or loss at the time of disposition and have not been significant. Expenditures for additions and improvements to our facilities are capitalized and expenditures for maintenance and repairs are charged to expense as incurred. Intangible assets, net Our intangible assets are primarily comprised of acquired TUKYSA technology. Upon FDA approval and commercial launch of TUKYSA in April 2020, we classified in-process research and development costs related to the acquired TUKYSA technology as finite-lived intangible assets. The following table presents the balances of our finite-lived intangible assets for the periods presented: December 31, (dollars in thousands) 2021 2020 Gross carrying value $ 305,650 $ 305,650 Less: accumulated amortization (45,057) (21,970) Total $ 260,593 $ 283,680 The following table presents our amortization expense related to acquired TUKYSA technology costs, included in cost of sales in our consolidated statements of comprehensive income (loss), for the periods presented: Years ended December 31, (dollars in thousands ) 2021 2020 2019 Amortization expense $ 23,087 $ 16,345 $ — The weighted average useful life of our finite-lived intangible assets was 11 years as of December 31, 2021, and estimated future amortization expense related to acquired TUKYSA technology costs is $23.1 million for each of the years ending December 31, 2022 through December 31, 2026. Goodwill We evaluate goodwill for impairment annually, as of October 1, or more frequently when events or circumstances indicate that impairment may have occurred. As part of the impairment evaluation, we may elect to perform an assessment of qualitative factors. If this qualitative assessment indicates that it is more likely than not that the fair value of the reporting unit (for goodwill) is less than its carrying value, we then would proceed with the quantitative impairment test to compare the fair value to the carrying value and record an impairment charge if the carrying value exceeds the fair value. Impairment of long-lived assets We assess the impairment of long-lived assets, including intangible assets and property and equipment, whenever events or changes in business circumstances indicate that the carrying amounts of the assets may not be fully recoverable. When such events occur, we determine whether there has been an impairment in value by comparing the asset’s carrying value with its fair value, as measured by the anticipated undiscounted net cash flows of the asset. If an impairment in value exists, the asset is written down to its estimated fair value. We have not recognized any impairment losses through December 31, 2021 as there have been no events warranting an impairment analysis. Our long-lived assets are primarily located in the U.S.; however, we have multiple subsidiaries in foreign jurisdictions, including several subsidiaries in Europe. Revenue recognition - Net product sales We sell our products primarily thr ough a limited number of specialty distributors and specialty pharmacies in the U.S, and to a lesser extent, internationally. The delivery of our products represents a single performance obligation for these transactions and we record net product sales at the point in time when control is transferred to the customer, which generally occurs upon receipt by the customer. The transaction price for net product sales represents the amount we expect to receive, which is net of estimated government-mandated rebates and chargebacks, distribution fees, estimated product returns, and other deductions. Accruals are established for these deductions, and actual amounts incurred are offset against applicable accruals. We reflect these accruals as either a reduction in the related account receivable from the distributor or as an accrued liability, depending on the nature of the sales deduction. Sales deductions are based on management’s estimates that consider payor mix in target markets and experience to-date. These estimates involve a substantial degree of judgment. Outside of the U.S., the transaction price for net product sales represents the amount we expect to receive, which is net of estimated discounts, estimated government mandated rebates, distribution fees, estimated product returns, and other deductions. Accruals are established for these deductions, and actual amounts incurred are offset against applicable accruals. These estimates involve judgment in estimating net product sales. U.S. government-mandated rebates and chargebacks : We have entered into a Medicaid Drug Rebate Agreement, or MDRA, with the Centers for Medicare & Medicaid Services. This agreement provides for a rebate based on covered purchases of our products. Medicaid rebates are invoiced to us by the various state Medicaid programs. We estimate Medicaid rebates using the expected value approach, based on a variety of factors, including payor mix and our experience to-date. We have a Federal Supply Schedule, or FSS, agreement under which certain U.S. government purchasers receive a discount on eligible purchases of our products. In addition, we have entered into a Pharmaceutical Pricing Agreement with the Secretary of Health and Human Services, which enables certain entities that qualify for government pricing under the Public Health Services Act, or PHS, to receive discounts on their qualified purchases of our products. Under these agreements, distributors process a chargeback to us for the difference between wholesale acquisition cost and the applicable discounted price. We estimate expected chargebacks for FSS and PHS purchases based on the expected value of each entity’s eligibility for the FSS and PHS programs. We also review historical rebate and chargeback information to further refine these estimates. Distribution fees, product returns and other deductions : Our distributors charge a volume-based fee for distribution services that they perform for us. We allow for the return of product that is within a specified number of days of its expiration date or that is damaged. We estimate product returns based on our experience to-date using the expected value approach. We provide financial assistance to qualifying patients that are underinsured or cannot cover the cost of commercial coinsurance amounts through our patient support programs. Estimated contributions for commercial coinsurance under Seagen Secure are deducted from gross sales and are based on an analysis of expected plan utilization. These estimates are adjusted as necessary to reflect our actual experience. Revenue recognition - Royalty revenues Royalty revenues primarily reflect amounts earned under the ADCETRIS collaboration with Takeda Pharmaceutical Company Limited, or Takeda. These royalties include commercial sales-based milestones and sales royalties that relate predominantly to the license of intellectual property. Sales royalties are based on a percentage of Takeda’s net sales of ADCETRIS, with rates that range from the mid-teens to the mid-twenties based on annual net sales tiers. Takeda bears a portion of low single digit third-party royalty costs owed on its sales of ADCETRIS. This amount is included in royalty revenues. Amounts owed to our third-party licensors related to Takeda’s sales of ADCETRIS are recorded in cost of sales. These amounts are recognized in the period in which the related sales by Takeda occur. Royalty revenues also reflect amounts from Genentech, Inc., a member of the Roche Group, or Genentech, earned on net sales of Polivy, and amounts from GlaxoSmithKline earned on net sales of Blenrep. Revenue recognition - Collaboration and license agreement revenues We have collaboration and license agreements for our technology with a number of biotechnology and pharmaceutical companies. Under these agreements, we typically receive or are entitled to receive upfront cash payments and progress- and sales-dependent milestones for the achievement by our licensees of certain events, and annual maintenance fees and support fees for research and development services and materials provided under the agreements. We also are entitled to receive royalties on net sales of any resulting products incorporating our technology. Generally, our licensees are solely responsible for research, product development, manufacturing and commercialization of any product candidates under these collaborations, which includes the achievement of the potential milestones. Since we may not take a substantive role or control the research, development or commercialization of any products generated by some of our licensees, we may not be able to reasonably estimate when, if at all, any potential future milestone payments or royalties may be payable to us by our licensees. As such, the potential future milestone payments associated with certain of our collaboration and license agreements involve a substantial degree of uncertainty and risk that they may never be received. Collaboration and license agreements are initially evaluated as to whether the intellectual property licenses granted by us represent distinct performance obligations. If they are determined to be distinct, the value of the intellectual property licenses would be recognized up-front while the research and development service fees would be recognized as the performance obligations are satisfied. Variable consideration is assessed at each reporting period as to whether it is not subject to future reversal of cumulative revenue and, therefore, should be included in the transaction price. Assessing the recognition of variable consideration requires significant judgment. If a contract includes a fixed or minimum amount of research and development support, this also would be included in the transaction price. Changes to collaboration and license agreements, such as the extensions of the research term or increasing the number of targets or technology covered under an existing agreement, are assessed for whether they represent a modification or should be accounted for as a new contract. We have concluded that the license of intellectual property in certain collaboration and license agreements is not distinct from the perspective of our customers at the time of initial transfer, since we often do not license intellectual property without related technology transfer and research and development support services. Such evaluation requires significant judgment since it is made from the customer's perspective. Our performance obligations under our collaborations may include such things as providing intellectual property licenses, performing technology transfer, performing research and development consulting services, providing reagents, ADCs, and other materials, and notifying the customer of any enhancements to licensed technology or new technology that we discover, among others. We determined our performance obligations under certain collaboration and license agreements as evaluated at contract inception were not distinct and represented a single performance obligation. Upfront payments are amortized to revenue over the performance period. Upfront payment contract liabilities resulting from our collaborations do not represent a financing component as the payment is not financing the transfer of goods or services, and the technology underlying the licenses granted reflects research and development expenses already incurred by us. For agreements beyond the initial performance period, we have no remaining performance obligations. We may receive license maintenance fees and potential milestones and royalties based on collaborator development and regulatory progress, which are recorded in the period achieved in the case of milestones, and during the period of the related sales for royalties. When no performance obligations are required of us, or following the completion of the performance obligation period, such amounts are recognized upon transfer of control of the goods or services to the customer. Generally, all amounts received or due other than sales-based milestones and royalties are classified as collaboration and license agreement revenues. Sales-based milestones and royalties are recognized as royalty revenue in the period the related sale occurred. We generally invoice our collaborators and licensees on a monthly or quarterly basis, or upon the completion of the effort or achievement of a milestone, based on the terms of each agreement. Deferred revenue arises from amounts received in advance of the culmination of the earnings process and is recognized as revenue in future periods as performance obligations are satisfied. Deferred revenue expected to be recognized within the next twelve months is classified as a current liability. Research and development expenses Research and development, or R&D, expenses consist of salaries, benefits and other headcount-related costs of our R&D staff, preclinical activities, clinical trials and related manufacturing costs, lab supplies, contract and outside service fees and facilities and overhead expenses for research, development and preclinical studies focused on drug discovery, development and testing. R&D activities are expensed as incurred. Clinical trial expenses are a significant component of research and development expenses, and we outsource a significant portion of these costs to third parties. Third-party clinical trial expenses include investigator fees, site costs, clinical research organization costs, and costs for central laboratory testing and data management. Costs associated with activities performed under co-development collaborations are reflected in R&D expense. In-licensing fees, milestones, maintenance fees and other costs to acquire technologies utilized in R&D for product candidates that have not yet received regulatory approval and that are not expected to have alternative future use are expensed when incurred. Non-refundable advance payments for goods or services that will be used or rendered for future R&D activities are capitalized and recognized as expense as the related goods are delivered or the related services are performed. This results in the temporary deferral of recording expense for amounts incurred for research and development activities from the time payments are made until the time goods or services are provided. Advertising Advertising costs are expensed as incurred. We incurred $88.8 million, $59.3 million, and $33.5 million in advertising expenses during 2021, 2020, and 2019, respectively. Concentration of credit risk Cash, cash equivalents and investments are invested in accordance with our investment policy. The policy includes guidelines for the investment of cash reserves and is reviewed periodically to minimize credit risk. Most of our investments are in U.S. Treasury securities and are not federally insured. We have accounts receivable from the sale of our products from a small number of distributors, and from our collaborators. We do not require collateral on amounts due from our distributors or our collaborators and are therefore subject to credit risk. Allowance for doubtful accounts We estimate an allowance for doubtful accounts based on our assessment of the collectability of customer accounts. We regularly review the allowance by considering factors such as historical experience, credit quality, the age of the accounts receivable balances, and current economic conditions that may affect a customer’s ability t o pay. As of December 31, 2021 and 2020, there was no allowance for doubtful accounts, and we recognized no credit losses during the years ended December 31, 2021, 2020, and 2019. Geographic and customer information Net product revenues are attributed to countries based on the location of the customer. Royalty revenues and collaboration and licenses agreements revenues are attributed to countries based on the location of the Company’s subsidiary associated with the royalty or collaborative arrangement related to such revenues. Over 90% of our revenues and assets are related to operations in the U.S. for all periods presented; however, we have multiple subsidiaries in foreign jurisdictions, including several subsidiaries in Europe. We sell our products throug h a limited nu mber of d istributors and specialty pharmacies. The following table presents each major distributor or collaborator that comprised more than 10% of total revenue: Years ended December 31, 2021 2020 2019 Distributor A 36 % 18 % 26 % Distributor B 27 % 15 % 21 % Distributor C 17 % 10 % 18 % Collaborator A 9 % 7 % 27 % Collaborator B — % 45 % — % The following table presents each major distributor or collaborator that accounted for more than 10% of accounts receivable: December 31, 2021 2020 Distributor A 29 % 32 % Distributor B 22 % 25 % Distributor C 16 % 16 % Collaborator A 11 % 13 % Major suppliers The use of a relatively small number of contract manufacturers to supply drug necessary for our commercial and clinical operations create a concentration of risk for us. While primarily one source of supply is utilized for certain components of our approved products and our clinical product candidates, other sources are available should we need to change suppliers. For PADCEV, in particular, we rely on Astellas for both commercial and clinical supply as Astellas oversees the manufacturing supply chain. As a form of reducing near-term risk, we endeavor to maintain reasonable levels of drug supply inventory across the supply chain. A change in suppliers or disruption at one of our suppliers, however, could cause a delay or interruption in delivery of drug or clinical trials. Such an event would adversely affect our business. Income taxes We recognize deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Deferred tax assets and liabilities are determined based on the differences between the financial statement and tax bases of assets and liabilities using tax rates in effect for the year in which the differences are expected to reverse. We have provided a valuation allowance against substantially all our deferred tax assets for all periods presented. A valuation allowance is recorded when it is more likely than not that some portion or all of the net deferred tax asset will not be realized. Future realization of deferred tax assets is dependent upon a number of factors, including the existence of sufficient taxable income based on future earnings, the timing and amount of which is uncertain. The assessment regarding whether a valuation allowance is required considers the evaluation of both positive and negative evidence when concluding whether it is more likely than not that deferred tax assets are realizable. Based upon a review of all available evidence, we determined that it is not more likely than not that the U.S. deferred tax assets will be realized, and therefore the deferred tax assets have been fully offset by a valuation allowance. We follow the guidance related to accounting for uncertainty in income taxes, which requires the recognition of an uncertain tax position when it is more likely than not to be sustainable upon audit by the applicable taxing authority. If this threshold is met, the tax benefit is then measured and recognized at the largest amount that is greater than 50% likely of being realized upon ultimate settlement. Share-based compensation We use the graded-vesting attribution method for recognizing compensation expense for our stock options and restricted stock units, or RSUs. Compensation expense is recognized over the requisite service periods on awards ultimately expected to vest and reduced for forfeitures that are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. For performance-based stock options and RSUs, we record compensation expense over the estimated service period once the achievement of the performance-based milestone is considered probable. At each reporting date, we assess whether achievement of a milestone is considered probable, and if so, record compensation expense based on the portion of the service period elapsed to date with respect to that milestone, with a cumulative catch-up, net of estimated forfeitures. We will recognize remaining compensation expense with respect to a milestone, if any, over the remaining estimated service period. Long-term incentive plans, performance-based and market-based restricted stock awards We have established Long-Term Incentive Plans, or LTIPs, and have granted certain senior leadership other performance- and market-based restricted stock awards. The LTIPs and other performance-based compensation restricted stock awards provide eligible employees with the opportunity to receive performance-based incentive compensation, which may be comprised of cash and/or RSUs. The payment of cash and the grant and/or vesting of RSUs are contingent upon the achievement of pre-determined performance goals, which may include regulatory milestones, revenue targets, or total shareholder return compared to our industry peer group. We record compensation expense over the estimated service period for each performance goal subject to the achievement of the performance goal being considered probable in accordance with the provisions of ASC Topic 450--Contingencies. At each reporting date, we assess whether achievement of a performance goal is considered probable and, if so, record compensation expense based on the portion of the service period elapsed to date with respect to that milestone, with a cumulative catch-up, net of estimated forfeitures. We recognize compensation expense with respect to a milestone over the remaining estimated service period. The total estimate of unrecognized compensation expense could change in the future for several reasons, including the addition or termination of employees, the recognition of LTIP compensation expense, or the addition, termination, or modification of an LTIP. Comprehensive income (loss) Comprehensive income (loss) is the change in stockholders’ equity from transactions and other events and circumstances other than those resulting from investments by stockholders and distributions to stockholders. Our comprehensive income (loss) is comprised of net income (loss), unrealized gains and losses on available-for-sale securities, net of income tax provision and foreign currency translation adjustments, net of income tax provision. Loss contingencies We are involved in various legal proceedings in the normal course of business. A loss contingency is recorded if it is probable that an asset has been impaired or a liability has been incurred and the amount of the loss can be reasonably estimated. We evaluate, among other factors, the probability of an unfavorable outcome and our ability to make a reasonable estimate and the amount of the ultimate loss. Loss contingencies that are determined to be reasonably possible, but not probable, are disclosed but not recorded. Legal fees incurred as a result of our involvement in legal procedures are expensed as incurred. Certain risks and uncertainties Our revenues are derived from net product sales, royalties, and from collaboration and license agreements. Our products are subject to regulation by the FDA in the U.S. and other regulatory agencies outside the U.S. as well as competition by other pharmaceutical companies. Our collaboration and license agreement revenues are derived from a relatively small number of agreements. Each of these agreements can be terminated by our collaborators at their discretion. We are also subject to risks common to companies in the pharmaceutical industry, including risks and uncertainties related to commercial success and acceptance of our products and our potential future products by patients, physicians and payers, competition from other products, regulatory approvals, regulatory requirements, business combinations and product or produc |
Revenue from contracts with cus
Revenue from contracts with customers | 12 Months Ended |
Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from contracts with customers | Revenue from contracts with customers The following table presents our disaggregated revenue for the years presented. Years ended December 31, (dollars in thousands) 2021 2020 2019 ADCETRIS $ 705,561 $ 658,577 $ 627,733 PADCEV 339,918 222,436 244 TUKYSA 333,952 119,585 — TIVDAK 6,135 — — Net product sales $ 1,385,566 $ 1,000,598 $ 627,977 Royalty revenues $ 150,523 $ 126,756 $ 138,491 Collaboration and license agreement revenues $ 38,282 $ 1,048,182 $ 150,245 Total revenues $ 1,574,371 $ 2,175,536 $ 916,713 In 2020, collaboration and license agreement revenues included $975.2 million related to our LV and TUKYSA license and collaboration agreements with Merck. See Note 10 for further information. In 2019, other collaboration and license agreement revenues included $20.0 million from BeiGene, Ltd., or BeiGene. BeiGene is a related party due to a common shareholder that has a representative or representatives serving on each company's respective Board of Directors. Contract balances and performance obligations We had no contract assets or liabilities as of December 31, 2021 and 2020. We recognized collaboration and license agreement revenues of $0.0 million, $0.0 million and $33.6 million during the years ended December 31, 2021, 2020, and 2019, respectively, that were included in deferred revenue as of the beginning of the respective years. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Leases | Leases We have operating leases for our office and laboratory facilities with terms that expire from 2022 through 2029. During the years ended December 31, 2021, 2020 and 2019, we recorded $9.1 million, $7.2 million and $40.3 million of right-of-use assets in exchange for lease liabilities, respectively. All of our significant leases include options for us to extend the lease term. None of our options to extend the rental term of any existing leases were considered reasonably certain as of December 31, 2021. In June 2021, we entered into a lease agreement for an approximately 258,000 square feet building complex to be constructed by the landlord on approximately 20.5 acres of land in Everett, Washington. We intend to use the building for future manufacturing, laboratory, and office space. Under the terms of the lease, base rent is payable at an initial rate of $4.0 million per year, subject to annual escalations of 3% during the initial term of 20 years. The lease commences on the date when construction and delivery of the building shell and related improvements by the landlord have been substantially completed. We will record a lease liability and right-of-use assets on our condensed consolidated balance sheet on the lease commencement date, which has not commenced of December 31, 2021. We have an option to renew the lease for two additional terms of ten years each. In addition, we have an option to purchase the premises in the future. Supplemental operating lease information was as follows: Years ended December 31, (dollars in thousands, except term and rate ) 2021 2020 2019 Operating lease cost $ 16,219 $ 15,013 $ 13,590 Variable lease cost 4,227 3,937 2,958 Total lease cost $ 20,446 $ 18,950 $ 16,548 Cash paid for amounts included in measurement of lease liabilities $ 16,814 $ 14,265 $ 10,197 As of December 31, 2021 2020 Weighted average remaining lease term (in years) 5.87 6.16 Weighted average discount rate 5.0 % 5.2 % Rent expense attributable to non-cancelable operating leases totaled approximately $16.5 million, $16.6 million, and $14.6 million for the years ended December 31, 2021, 2020, and 2019, respectively. Operating lease liabilities were recorded in the following captions of our consolidated balance sheet as follows: As of December 31, (dollars in thousands ) 2021 2020 Accrued liabilities and other $ 13,905 $ 12,749 Operating lease liabilities, long-term 56,665 61,884 Total $ 70,570 $ 74,633 As of December 31, 2021, future minimum lease payments under the lease agreements were as follows: (dollars in thousands) Years ending December 31, 2022 $ 17,088 2023 16,375 2024 12,333 2025 8,489 2026 7,999 Thereafter 19,718 Total future minimum lease payments 82,002 Less: imputed interest (11,432) Total $ 70,570 |
Fair Value
Fair Value | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Fair Value We have certain assets that are measured at fair value on a recurring basis according to a fair value hierarchy that prioritizes the inputs, assumptions and valuation techniques used to measure fair value. The three levels of the fair value hierarchy are: Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. Level 2: Quoted prices in markets that are not active or financial instruments for which all significant inputs are observable, either directly or indirectly. Level 3: Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable. The determination of a financial instrument’s level within the fair value hierarchy is based on an assessment of the lowest level of any input that is significant to the fair value measurement. We consider observable data to be market data which is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant market. The fair value hierarchy of assets carried at fair value and measured on a recurring basis was as follows: Fair value measurement using: (dollars in thousands) Quoted prices Other Significant Total December 31, 2021 Short-term investments—U.S. Treasury securities $ 1,735,202 $ — $ — $ 1,735,202 Other non-current assets—equity securities 14,009 — — 14,009 Total $ 1,749,211 $ — $ — $ 1,749,211 December 31, 2020 Short-term investments—U.S. Treasury securities $ 2,000,996 $ — $ — $ 2,000,996 Long-term investments—U.S. Treasury securities 100,830 — — 100,830 Total $ 2,101,826 $ — $ — $ 2,101,826 Our short- and long-term debt investments portfolio only contains investments in U.S. Treasury and other U.S. government-backed securities. We review our portfolio based on the underlying risk profile of the securities and have a zero loss expectation for these investments. We also regularly review the securities in an unrealized loss position and evaluate the current expected credit loss by considering factors such as historical experience, market data, issuer-specific factors, and current economic conditions. During the years ended December 31, 2021, 2020 and 2019, we recognized no year-to-date credit loss related to our short- and long-term investments, and had no allowance for credit loss recorded as of December 31, 2021. Our debt securities consisted of the following: (dollars in thousands) Amortized Gross Gross Fair December 31, 2021 U.S. Treasury securities $ 1,735,388 $ 12 $ (198) $ 1,735,202 Contractual maturities (at date of purchase): Due in one year or less $ 1,635,307 $ 1,635,118 Due in one to two years 100,081 100,084 Total $ 1,735,388 $ 1,735,202 December 31, 2020 U.S. Treasury securities $ 2,101,801 $ 259 $ (234) $ 2,101,826 Contractual maturities (at date of purchase): Due in one year or less $ 1,791,399 $ 1,791,239 Due in one to two years 310,402 310,587 Total $ 2,101,801 $ 2,101,826 |
Investment and Other Income, Ne
Investment and Other Income, Net | 12 Months Ended |
Dec. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Investment and Other Income, Net | Investment and Other Income, Net Investment and other income, net consisted of the following: Years ended December 31, (dollars in thousands) 2021 2020 2019 Gain on equity securities $ 4,744 $ 11,604 $ 50,124 Investment and other income, net 1,607 7,245 11,771 Total investment and other income, net $ 6,351 $ 18,849 $ 61,895 Gain on equity securities includes the realized and unrealized holding gains and losses on our equity securities. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consisted of the following: December 31, (dollars in thousands) 2021 2020 Raw materials $ 12,181 $ 3,799 Work in process 152,635 95,250 Finished goods 35,847 17,087 Total $ 200,663 $ 116,136 We capitalize our commercial inventory costs. Inventory that is deployed into clinical, research or development use is charged to research and development expense when it is no longer available for use in commercial sales. |
Property and equipment
Property and equipment | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property and equipment | Property and equipment Property and equipment consisted of the following: December 31, (dollars in thousands) 2021 2020 Leasehold improvements $ 193,635 $ 204,918 Laboratory and manufacturing equipment 104,702 78,724 Building 49,806 23,341 Computers, software and office equipment 52,078 45,141 Furniture and fixtures 17,563 15,825 Land 4,771 4,771 422,555 372,720 Less: accumulated depreciation and amortization (212,482) (176,020) Total $ 210,073 $ 196,700 Depreciation and amortization expenses on property and equipment totaled $42.9 million, $36.0 million, and $23.8 million for the years ended December 31, 2021, 2020, and 2019, respectively. Leasehold improvements included $44.0 million and $24.5 million of construction in process at December 31, 2021 and 2020, respectively. |
Accrued liabilities
Accrued liabilities | 12 Months Ended |
Dec. 31, 2021 | |
Payables and Accruals [Abstract] | |
Accrued liabilities | Accrued liabilities Accrued liabilities consisted of the following : December 31, (dollars in thousands) 2021 2020 Employee compensation and benefits $ 139,052 $ 96,902 Clinical trial and related costs 122,468 69,756 Contract manufacturing 21,867 20,765 Gross-to-net deductions and third-party royalties 81,316 52,565 Other 89,327 70,083 Total $ 454,030 $ 310,071 |
Income taxes
Income taxes | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Income taxes Our income (loss) before income taxes by jurisdiction consisted of the following: Years ended December 31, (dollars in thousands) 2021 2020 2019 U.S. $ (680,398) $ 613,054 $ (160,189) Foreign 4,693 2,647 1,539 Total $ (675,705) $ 615,701 $ (158,650) A reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows: Years ended December 31, 2021 2020 2019 Statutory federal income tax rate 21.0 % 21.0 % 21.0 % Tax credits 7.2 (5.4) 11.0 State income taxes and other 4.6 1.5 4.7 Valuation allowance (35.7) (8.4) (37.1) Stock compensation 3.1 (8.4) 6.4 Non-deductible asset basis — — (6.0) Effective tax rate 0.2 % 0.3 % 0.0 % For the year ended December 31, 2021, we recorded a tax benefit of $1.2 million, consisting of a current tax benefit of $1.7 million and a deferred tax expense of $0.5 million, primarily related to the generation of additional available state research and development tax credits. For the year ended December 31, 2020, we recorded a provision for income taxes of $2.0 million consisting primarily of $3.7 million of current state taxes offset by a net $1.7 million deferred foreign tax benefit primarily related to the release of a valuation allowance on our foreign deferred tax asset for net operating losses. We had existing federal tax carryforwards sufficient to offset any federal tax liability, and we incurred state tax liabilities of $3.7 million due to limitations on the use of existing state carryforwards against taxable income. For the year ended December 31, 2019, we did not record any income tax expense or benefit due to our valuation allowance and tax loss position. As of December 31, 2021, unremitted earnings of our foreign subsidiaries will be retained indefinitely by the foreign subsidiaries for continuing investment. If foreign earnings were to be repatriated to the U.S., we could be subject to additional state income and withholding taxes. Our net deferred tax assets consisted of the following: December 31, (dollars in thousands) 2021 2020 Deferred tax assets: Net operating loss carryforwards $ 331,284 $ 228,041 Foreign net operating loss carryforwards 7,566 8,341 Tax credit carryforwards 278,925 224,233 Share-based compensation 41,087 33,315 Allowance and accruals 47,119 29,355 Operating lease liabilities 16,461 16,596 Inventory 14,629 19,402 Capitalized research and development 6,947 4,139 Intangibles and amortization 5,399 — Total deferred tax assets 749,417 563,422 Less: valuation allowance (730,130) (489,519) Total deferred tax assets, net of valuation allowance 19,287 73,903 Deferred tax liability: Right-of-use assets (13,434) (13,647) Intangibles and amortization — (46,018) Depreciation (3,428) (10,215) Other (920) (1,970) Net deferred tax assets $ 1,505 $ 2,053 A valuation allowance of $730.1 million and $489.5 million at Decemb er 31, 2021 and 2020, respectively, has been recognized to offset net deferred tax assets where realization of such assets is uncertain. The valuation allowance increased by $240.6 million in 2021, decreased by $46.8 million in 2020, and increased by $58.5 million in 2019, which was mostly related to the changes in our deferred tax asset balances. The 2021 and 2019 increases in the valuation allowance were primarily due to the net operating loss and tax credit generation. The 2020 decrease in the valuation allowance was primarily due to the net operating loss utilization, partially offset by tax credit generation. At December 31, 2021, we had gross federal NOL carryforwards of $1,347 million of which $709 million may be carried forward indefinitely and $638 million expire from 2033 to 2037 if not utilized, gross state NOL carryforwards of $614.4 million, gross foreign NOL carryforwards of $38.3 million, and tax credit carryforwards of $302.4 million expiring from 2022 to 2041. Utilization of the NOL and tax credit carryforwards may be subject to a substantial annual limitation in the event of a change in ownership as set forth in Section 382 of the Internal Revenue Code of 1986, as amended. We have evaluated ownership changes through the year ended December 31, 2020 and believe that it is likely that utilization of its NOLs would not be limited under Section 382 as of December 31, 2020. It is possible that there has been or may be a change in ownership after this date which would limit our ability to utilize our NOLs. Any limitation may result in the expiration of the NOLs and tax credit carryforwards before utilization. Unrecognized tax benefits arise when the estimated benefit recorded in the financial statements differs from the amounts taken or expected to be taken in a tax return because of uncertainties. The total amount of unrecognized tax benefit was $30.3 million and $23.1 million as of December 31, 2021 and 2020, respectively. Interest and penalties related to uncertain tax positions, if any, will be recognized as a component of income tax expense. We do not anticipate any significant changes to our unrecognized tax positions or benefits during the next twelve months. Tax years 2001 to 2021 remain subject to future examination for federal, state and foreign income taxes. A reconciliation of the beginning and ending amount of unrecognized tax benefits was as follows: Years ended December 31, (dollars in thousands) 2021 2020 2019 Balance at January 1 $ 23,078 $ 24,018 $ 20,706 Increase (decrease) related to prior year tax positions 1,894 (4,008) — Increase related to current year tax positions 5,334 3,068 3,312 Balance at December 31 $ 30,306 $ 23,078 $ 24,018 |
Collaboration and license agree
Collaboration and license agreements | 12 Months Ended |
Dec. 31, 2021 | |
Collaboration Arrangement Disclosure [Abstract] | |
Collaboration and license agreements | Collaboration and license agreements We have collaboration and license agreements with a number of pharmaceutical and biotechnology companies. Revenues recognized under these agreements are disclosed in Note 2. These agreements generally may be terminated due to material and uncured breaches, insolvency of either party, mutual written consent, unilateral decision of one or either party upon prior written notice, expiration of payment obligations, cessation of development or commercialization of the products, and/or challenges to patents which are subject to the related agreement. Each agreement is discussed in more detail in the following sections. Takeda ADCETRIS collaboration The Takeda ADCETRIS collaboration provides for the global co-development of ADCETRIS and the commercialization of ADCETRIS by Takeda in its territory. We have commercial rights for ADCETRIS in the U.S. and its territories and in Canada. Takeda has commercial rights in the rest of the world. Under the collaboration, we and Takeda can each conduct development activities and equally co-fund the cost of certain mutually agreed development activities. Costs associated with co-development activities are included in research and development expense. We recognize payments received from Takeda, including progress-dependent development and regulatory milestone payments, reimbursement for drug supplied, and net development cost reimbursement payments, as collaboration and license agreement revenues upon transfer of control of the goods or services over the development period. When the performance of development activities under the collaboration results in us making a reimbursement payment to Takeda, that payment reduces collaboration and license agreement revenues. In addition, we recognize royalty revenues, where royalties are based on a percentage of Takeda’s net sales of ADCETRIS in its licensed territories, with percentages ranging from the mid-teens to the mid-twenties based on annual net sales tiers, and sales-based milestones. Takeda bears a portion of third-party royalty costs owed on its sales of ADCETRIS, which is included in royalty revenues. Astellas PADCEV collaboration We have a collaboration agreement with Agensys, Inc., which subsequently became an affiliate of Astellas, to jointly research, develop and commercialize ADCs for the treatment of several types of cancer. The collaboration encompasses combinations of our ADC technology with fully-human antibodies developed by Astellas to proprietary cancer targets. Under this collaboration, we and Astellas are co-funding all development costs for PADCEV. We rely on Astellas to supply PADCEV for commercial sales and for our clinical trials, and Astellas oversees the manufacturing supply chain for PADCEV. Costs associated with co-development activities are included in research and development expense and amounted to $145.4 million, $99.3 million, and $76.8 million for the years ended December 31, 2021, 2020, and 2019, respectively. In 2018, we and Astellas entered into a joint commercialization agreement to govern the global commercialization of PADCEV: • In the U.S., we and Astellas jointly promote PADCEV. We record sales of PADCEV in the U.S. and are responsible for all U.S. distribution activities. The companies each bear the costs of their own sales organizations in the U.S., equally share certain costs associated with commercializing PADCEV in the U.S., and equally share in any profits realized in the U.S. We and Astellas launched PADCEV in the U.S. in December 2019. Gross profit share payments owed to Astellas in the U.S. are recorded in cost of sales and totaled $159.0 million and $104.6 million during the years ended December 31, 2021 and 2020, respectively. • Outside the U.S., we have commercialization rights in all countries in North and South America, and Astellas has commercialization rights in the rest of the world, including Europe, Asia, Australia and Africa. The agreement is intended to provide that we and Astellas will effectively equally share in costs incurred and any profits realized in all of these markets. Cost and profit sharing in Canada, the United Kingdom, Germany, France, Spain and Italy will be based on product sales and costs of commercialization. In the remaining markets, the commercializing party will bear costs and will pay the other party a royalty rate applied to net sales of the product based on a rate intended to approximate an equal profit share for both parties. Either party may opt out of co-development and profit-sharing under the collaboration agreement in return for receiving milestones and royalties from the continuing party. Astellas or its affiliates are responsible for overseeing the manufacturing supply chain for PADCEV for development and commercial use. However, we are responsible for packaging and labeling in countries in which we sell PADCEV. In addition, if the parties determine that a second source is required, we will be responsible for establishing such second source whether internally or through a third party. Genmab TIVDAK collaboration We have an agreement with Genmab to develop and commercialize ADCs targeting tissue factor, under which we previously exercised a co-development option for TIVDAK. In October 2020, we and Genmab entered into a joint commercialization agreement to govern the global commercialization of TIVDAK. The FDA granted accelerated approval of TIVDAK in September 2021 for the treatment of adult patients with recurrent or metastatic cervical cancer with disease progression on or after chemotherapy. • In the U.S., we and Genmab co-promote TIVDAK. We record sales of TIVDAK in the U.S. and are responsible for leading U.S. distribution activities. The companies will each hire and maintain 50% of the sales representatives and medical science liaisons, equally share those and certain other costs associated with commercializing TIVDAK in the U.S., and equally share in any profits realized in the U.S. Gross profit share payments owed to Genmab in the U.S. are recorded in cost of sales. • Outside the U.S., we have commercialization rights in the rest of the world except for Japan, where Genmab has commercialization rights. In Europe, China, and Japan, we and Genmab equally share 50% of the costs associated with commercializing TIVDAK as well as any profits realized in these markets. In markets outside the U.S. other than Europe, China, and Japan, aside from certain costs specified in the agreement, we are solely responsible for all costs associated with commercializing TIVDAK and will pay Genmab a royalty based on a percentage of aggregate net sales ranging from the mid-teens to mid-twenties. Costs associated with co-development activities are included in research and development expense and amounted $63.7 million, $50.1 million, and $48.5 million for the years ended December 31, 2021, 2020, and 2019, respectively. Either party may opt out of co-development and profit-sharing under the collaboration agreement in return for receiving milestones and royalties from the continuing party. Either party may also opt out of co-development and profit-sharing under the collaboration agreement in return for receiving milestones and royalties from the continuing party. The opt out provisions of the collaboration agreement may also be applied to the joint commercialization agreement. In addition, Genmab may elect to opt out of co-promotion of TIVDAK in the U.S. by providing us with prior written notice. Merck LV and TUKYSA license and collaboration agreements, and stock purchase agreement In September 2020, we entered into two license and collaboration agreements, and a stock purchase agreement, with Merck. Under one of the license and collaboration agreements, referred to as the LV Agreement, we are pursuing a broad joint development program evaluating ladiratuzumab vedotin, or LV, as monotherapy and in combination with Merck’s anti-PD-1 therapy KEYTRUDA® (pembrolizumab) in triple-negative breast cancer, hormone receptor-positive breast cancer and other LIV-1-expressing solid tumors. Pursuant to the LV Agreement, we granted to Merck a co-exclusive worldwide development and commercialization license for LV, and agreed to jointly develop and commercialize LV on a worldwide basis. We received an upfront cash payment of $600.0 million, and we are eligible to receive up to $850.0 million in milestone payments upon the initiation of certain clinical trials and regulatory approval in certain major markets, and up to an additional $1.75 billion in milestone payments upon the achievement of specified annual global net sales thresholds of LV. Each company is responsible for 50% of global costs to develop and commercialize LV and will receive 50% of potent ial future profits. In connection with the LV Agreement, we entered into a stock purchase agreement with Merck, referred to as the Purchase Agreement, pursuant to which we agreed to issue and sell, and Merck agreed to purchase 5,000,000 newly issued shares of our common stock, at a purchase price of $200 per share, for an aggregate purchase price of $1.0 billion. Under the other license and collaboration agreement, referred to as the TUKYSA Agreement, we granted Merck exclusive rights to commercialize TUKYSA in Asia, the Middle East and Latin America and other regions outside of the U.S., Canada and Europe. Pursuant to the TUKYSA Agreement, Merck is responsible for marketing applications for approval in its territory, supported by the positive results from the HER2CLIMB clinical trial. We retained commercial rights in the U.S., Canada and Europe, where we will record sales. Merck is also co-funding a portion of the TUKYSA global development plan, which encompasses several ongoing and planned trials across HER2-positive cancers. We will continue to lead ongoing TUKYSA global development operational execution. Merck will solely fund and conduct country-specific clinical trials necessary to support anticipated regulatory applications in its territories. We received an upfront cash payment from Merck of $125.0 million and also received $85.0 million in prepaid research and development funding to be applied to Merck’s global development cost sharing obligations. We are eligible to receive progress-dependent milestone payments of up to $65.0 million, and are entitled to receive tiered royalties on sales of T UKYSA by Merck that begin in the low twenty percent range and escalate based sales volume by Merck in its territory. We owe a portion of any non-royalty payments received from sublicensing TUKYSA rights to a technology licensor, as well as a low double-digit royalty based on net sales of TUKYSA by us, and will owe a single-digit royalty based on net sales of TUKYSA by Merck in its territories. We determined that these agreements are within the scope of ASC 808. Pursuant to ASC 808, we considered other authoritative guidance for distinct units of account related to these agreements, including ASC 606. Our performance obligations within the scope of ASC 606 consisted of the delivery of the LV license and transfer of regulatory information to enable the LV collaboration, the delivery of the TUKYSA license and transfer of regulatory materials for use by Merck in its territory, and supply of commercial TUKYSA inventory to Merck for use in its territory. The LV license and TUKYSA license are functional intellectual property and distinct from the other promises made under the contract. Since we also determined that Merck can benefit from the LV license and the TUKYSA licenses at the time of conveyance, the related performance obligations were satisfied at that point in ti me. Therefore, we recognized the license revenue under ASC 606 of $725.0 million in collaboration and license agreement revenues during the year ended December 31, 2020. Potential development, regulatory, and sales-based milestones, and royalties, will be accounted for as variable transaction price related to the LV or TUKYSA licenses under ASC 606. Given the uncertain nature of these payments, we determined they were fully constrained upon entering the agreements and not included in the transaction price. We will re-evaluate the transaction price at each reporting period and as uncertain events are resolved or other changes in circumstances occur. We and Merck will share equally in LV global development costs and profits, if any, and Merck is co-funding a portion of the TUKYSA global development plan. We consider the collaborative activities associated with the global development and commercialization of LV, and the global development of TUKYSA, to be units of account within the scope of ASC 808. We recognize development cost sharing proportionately with the performance of the underlying activities, and record Merck’s reimbursement of our expenses as a reduction of research and development expenses. Reimbursements from Merck for the LV Agreement and TUKYSA Agreement were not material during the y ear ended December 31, 2020. Merck’s prepayment of $85.0 million towards the TUKYSA global development plan was recorded as a co-development liability in other long-term liabilities on our consolidated balance sheet as of December 31, 2020. As joint development expenses are incurred, we recognize the portion of Merck’s prepayment as a reduction of our research and development expenses on our consolidated statements of comprehensive income (loss). As of December 31, 2021, $40.2 million and $15.1 million was recorded as the remaining co-development liability in accrued liabilities and other long-term liabilities, respectively. As of December 31, 2020, $30.1 million and $50.8 million was recorded as the remaining co-development liability in accrued liabilities and other long-term liabilities, respectively. Sales of TUKYSA drug product supplied to Merck were included in collaboration and license agreement revenues. The fair market value of 5,000,000 shares of our common stock was $749.9 million, based on the closing price of the last trading day prior to the Purchase Agreement being executed. We accounted for the associated premium of $250.1 million as a freestanding equity-linked instrument under ASC 815. The premium was determined to be variable consideration in the calculation of the total transaction price related to the LV license, and was initially recorded in deferred revenue due to the substantive contingency associated with closing of the sale of shares under the Purchase Agreement. The closing of the sale of the shares pursuant to the Purchase Agreement occurred in October 2020. Upon closing, we recorded the fair market value of the shares issued in stockholders’ equity on our consolidated balance sheet. The variable consideration restraint was removed upon the closing of the sale of shares pursuant to the Purchase Agreement, and the premium was recognized in collaboration and license agreement revenues in the quarter and year ended December 31, 2020. RemeGen license agreement In September 2021, we and RemeGen Co., Ltd., or RemeGen, entered into an exclusive worldwide licensing agreement to develop and commercialize disitamab vedotin, a novel HER2-targeted ADC. Disitamab vedotin combines the drug-linker technology originally developed by us with RemeGen’s novel HER2 antibody. Disitamab vedotin received FDA Breakthrough Therapy designation in 2020 for use in second-line treatment of patients with HER2-expressing, locally advanced or metastatic urothelial cancer who have previously received platinum-containing chemotherapy. Also in 2020, RemeGen announced FDA’s clearance of an Investigational New Drug application for a phase 2clinical trial in locally advanced or metastatic urothelial cancer. Disitamab vedotin is conditionally approved for treating locally advanced metastatic gastric cancer in China, and in July 2021 the National Medical Products Administration of China also accepted a New Drug Application for disitamab vedotin in locally advanced or metastatic urothelial cancer. Under the terms of the agreement, we obtained exclusive license rights to disitamab vedotin for global development and commercialization outside of RemeGen’s territory for an upfront payment of $200.0 million. The license was accounted for as an asset acquisition and the upfront payment was included in research and development expenses for the year ended December 31, 2021. RemeGen retains development and commercialization rights for Asia, excluding Japan and Singapore. We will lead global development and RemeGen will fund and operationalize the portion of global clinical trials attributable to its territory. RemeGen will also be responsible for all clinical development and regulatory submissions specific to its territory. We will pay RemeGen up to $195.0 million in potential milestone payments across multiple indications and products based upon the achievement of specified development goals, and up to $2.2 billion in potential milestone payments based on the achievement of specified regulatory and commercialization goals. RemeGen will be entitled to a tiered, high single digit to mid-teen percentage royalty based on net sales of disitamab vedotin in our territory. Other collaboration and license agreements We have other collaboration and license agreements for our technology with a number of biotechnology and pharmaceutical companies. Under these agreements, we have granted research and commercial licenses to use our technology, most often in conjunction with the licensee's technology. In certain agreements, we also have agreed to conduct limited development activities and to provide other materials, supplies and services to our licensees during a specified term of the agreement. We typically receive upfront cash payments and progress- and sales-dependent milestones for the achievement by our licensees of certain events, and annual maintenance fees and support fees for research and development services and materials provided under the agreements. These amounts are recognized as revenue over the performance obligation period if the license is determined to not be distinct from other goods and services provided, or, if there is no performance obligation, upon transfer of control of the goods or services to the customer. We also are entitled to receive royalties on net sales of any resulting products incorporating our ADC technology. Our licensees are solely responsible for research, product development, manufacturing and commercialization of any product candidates under these agreements, which includes the achievement of the potential milestones. For agreements beyond the initial performance period, we have no remaining performance obligations. We may receive license maintenance fees and potential milestones and royalties based on collaborator development and regulatory progress, which are recorded in the period achieved in the case of milestones, and during the period of the related sales for royalties. |
In-license agreements
In-license agreements | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
In-license agreements | In-license agreements We have in-licensed antibodies, targets and enabling technologies from pharmaceutical and biotechnology companies and academic institutions for use in our pipeline programs and ADC technology. W e would potentially owe development, regulatory, and sales-based milestones, and royalties on net sales, as defined, of certain approved products. We were required to pay royalties in the low single digits on net sales of ADCETRIS under the terms of two exclusive license agreements, which expired in 2021. We are a party to a license agreement in which we were granted an exclusive license to develop, manufacture and commercialize TUKYSA. We pay the licensor a portion of any non-royalty payments received from sublicensing TUKYSA rights, a low double-digit royalty based on net sales of TUKYSA by us, and a single-digit royalty based on net sales of TUKYSA by our sublicensees. The term of the license agreement expires on a country-by-country basis upon the later of the expiration of the last valid claim covering TUKYSA within that country or 10 years after the first commercial sale of TUKYSA within that country. |
Commitments and contingencies
Commitments and contingencies | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | Commitments and contingencies We have certain non-cancelable obligations under various agreements, including supply agreements relating to the manufacture of our commercial products, and our product candidates that contain annual minimum purchase commitments and other firm commitments when a binding forecast is provided. As of December 31, 2021, our future obligations related to supply and other agreements were as follows: (dollars in thousands) Years ending December 31, 2022 $ 204,328 2023 89,460 2024 62,686 2025 33,016 2026 6,513 Thereafter — Total $ 396,003 Non-cancelable obligations under these agreements do not include payments that are contingent upon achievement of certain progress-dependent milestones or royalties based on net sales of commercial products. These amounts have been excluded from the table because the events triggering the obligations have not yet occurred. See Note 3 for our future obligations related to operating leases as of December 31, 2021. |
Legal matters
Legal matters | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Legal matters | Legal matters We are engaged in multiple legal disputes with Daiichi Sankyo Co. Ltd., or Daiichi Sankyo. Dispute over ownership of intellectual property We are in a dispute with Daiichi Sankyo regarding the ownership of certain technology used by Daiichi Sankyo in its cancer drug ENHERTU and certain product candidates. We believe that the linker and other ADC technology used in ENHERTU and these drug candidates are improvements to our ADC technology, the ownership of which we contend was assigned to us under the terms of a 2008 collaboration agreement between us and Daiichi Sankyo. On November 12, 2019, we submitted an arbitration demand to the American Arbitration Association seeking, among other remedies, a declaration that we are the owner of the intellectual property rights under dispute, monetary damages, and a running royalty. On April 27, 2020, the arbitrator confirmed the dispute should be resolved in arbitration. The arbitration hearing was conducted in June 2021. Recently, the arbitration hearing record was reopened by the arbitrator to consider additional evidence. As a result, the decision may occur after the first quarter of 2022. On November 4, 2019, Daiichi Sankyo filed a declaratory judgment action in the United States District Court for the District of Delaware, alleging that we are not entitled to the intellectual property rights under dispute, in an attempt to have the dispute adjudicated in federal court. The case has been stayed and administratively closed by court order. Patent infringement On October 19, 2020, we filed a complaint in the United States District Court for the Eastern District of Texas to commence an action for infringement of our U.S. Patent No. 10,808,039, or the '039 Patent, by Daiichi Sankyo’s importation into, offer for sale, sale, and use in the United States of the cancer drug ENHERTU. This action is seeking, among other remedies, a judgment that Daiichi Sankyo infringed one or more valid and enforceable claims of the '039 Patent, monetary damages and a running royalty. Daiichi Sankyo (as well as Daiichi Sankyo, Inc. and AstraZeneca Pharmaceuticals, LP, or AstraZeneca) subsequently filed an action on November 13, 2020 in the U.S. District Court for the District of Delaware seeking a declaratory judgment that ENHERTU does not infringe the ‘039 Patent. The Delaware action has been stayed by court order. Daiichi Sankyo, Inc. and AstraZeneca also filed two Petitions for Post-Grant Review on December 23, 2020 and January 22, 2021 with the U.S. Patent Office seeking to have claims of the ‘039 Patent cancelled as unpatentable. On June 24, 2021, the U.S. Patent Office issued a decision denying both Petitions for Post-Grant Review. The trial in the patent infringement case in Texas is scheduled to begin on April 4, 2022. As a result of these disputes, we have incurred and will continue to incur litigation expenses. In addition, from time to time, we may become involved in other lawsuits, claims and proceedings relating to the conduct of our business, including those pertaining to the defense and enforcement of our patent or other intellectual property rights and our contractual rights. These proceedings are costly and time consuming, and they may subject us to claims which may result in liabilities or require us to take or refrain from certain actions. Additionally, successful challenges to our patent or other intellectual property rights through these proceedings could result in a loss of rights in the relevant jurisdiction and may allow third parties to use our proprietary technologies without a license from us or our collaborators. |
Stockholders' equity
Stockholders' equity | 12 Months Ended |
Dec. 31, 2021 | |
Equity [Abstract] | |
Stockholders' equity | Stockholders’ equity In October 2020, we closed the sale of the shares pursuant to the Purchase Agreement, and issued 5,000,000 shares of our common stock to Merck at a purchase price of $200 per share, for proceeds of $1.0 billion. As a result, we recorded $749.9 million in stockholders’ equity on our consolidated balance sheet and recognized the $250.1 million premium attributed to the Purchase Agreement in collaboration and license agreement revenues for the year ended December 31, 2020. In July 2019, we completed an underwritten public offering of 8,214,286 shares of our common stock at a public offering price of $70.00 per share. The offering resulted in net proceeds to us of $548.7 million, after deducting underwriting discounts, commissions, and other offering expenses. At December 31, 2021, shares of common stock reserved for future issuance are as follows: (in thousands) Stock options and RSUs outstanding 10,535 Shares available for future grant under the 2007 Equity Incentive Plan 6,673 Employee stock purchase plan shares available for future issuance 840 Total 18,048 |
Net (loss) income per share
Net (loss) income per share | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Net (loss) income per share | Net (loss) income per share Basic net income (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted net income (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares and potentially dilutive common shares outstanding during the period. Potentially dilutive common shares include incremental common shares issuable upon the vesting of unvested restricted stock units and the exercise of outstanding stock options, calculated using the treasury stock method. Years ended December 31, (dollars in thousands, except per share amounts) 2021 2020 2019 Net (loss) income $ (674,471) $ 613,670 $ (158,650) Weighted average common shares outstanding - basic 182,048 174,834 165,498 Effect of potentially dilutive common shares — 7,453 — Weighted average common shares outstanding - diluted 182,048 182,287 165,498 Net (loss) income per share - basic $ (3.70) $ 3.51 $ (0.96) Net (loss) income per share - diluted $ (3.70) $ 3.37 $ (0.96) We excluded the potential shares of common stock from the computation of diluted net income (loss) per share because their effect would have been antidilutive. The following table presents the weighted average number of shares that have been excluded for all periods presented: Years ended December 31, (in thousands) 2021 2020 2019 Stock options and RSUs 10,327 356 12,774 |
Share-based compensation
Share-based compensation | 12 Months Ended |
Dec. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Share-based compensation | Share-based compensation 2007 Equity Incentive Plan Our 2007 Equity Incentive Plan, or the 2007 Plan, provides for the issuance of our common stock to employees, including our officers, directors and consultants and affiliates. The 2007 Plan was amended and restated in 2020 to reserve an additional 6,000,000 shares thereunder, such that an aggregate of 39,000,000 shares of our common stock were authorized for issuance as of December 31, 2021, and to extend the term of the 2007 Plan through May 2030 unless it is terminated earlier pursuant to its terms. Under the 2007 Plan, we may issue stock options (including incentive stock options and nonstatutory stock options), restricted stock, RSUs, stock appreciation rights and other similar types of awards. We have only issued options to purchase shares of common stock and RSUs under the 2007 Plan, including options and RSUs with time-based or performance-based vesting requirements. Performance-based vesting occurs upon achievement of pre-determined regulatory milestones, sales-based milestones, or market-based performance metrics. Incentive stock options under the 2007 Plan may be granted only to our employees. The exercise price of an incentive stock option or a nonstatutory stock option may not be less than 100% of the fair market value of the common stock on the date the option is granted and the options generally have a maximum term of ten years from the date of grant. Generally, options granted to employees under the 2007 Plan vest 25% one year after the grant date and thereafter ratably each month over the following thirty-six months. Generally, RSUs granted to employees vest 25% each year beginning one year after the grant date. Option and RSU grants to non-employee members of our board of directors vest over one year. The vesting of performance-based awards generally includes vesting upon achievement of pre-determined milestones or metrics and, in some cases, vesting upon achievement of pre-determined milestones or metrics in addition to the passage of time. The 2007 Plan provides for (i) the full acceleration of vesting of equity awards upon a change in control if the successor company does not assume, substitute or otherwise replace the equity awards upon the change in control; and (ii) the full acceleration of vesting of any equity awards if at the time of, immediately prior to or within twelve months after a change in control of the Company, the holder of such equity awards is involuntarily terminated without cause or is constructively terminated by the successor company that assumed, substituted or otherwise replaced such stock awards in connection with the change in control. Share-based compensation expense The following table presents our total share-based compensation expense for the periods presented: Years ended December 31, (dollars in thousands) 2021 2020 2019 Research and development $ 79,715 $ 72,749 $ 64,730 Selling, general and administrative 93,402 74,484 62,619 Total share-based compensation expense 173,117 147,233 127,349 No tax benefit was recognized for the years ended December 31, 2021 and 2019 since there is no taxable income for those years and a valuation allowance is available to offset all potential tax benefits associated with its deferred tax assets. We recognized a tax benefit of $55.7 million related to share-based compensation expense for 2020. Valuation assumptions We calculate the fair value of each option award on the date of grant using the Black-Scholes option pricing model. The following weighted-average assumptions were used for the periods indicated: 2007 Plan Employee Stock Purchase Plan Years ended December 31, Years ended December 31, 2021 2020 2019 2021 2020 2019 Risk-free interest rate 0.8 % 0.3 % 1.5 % 0.1 % 1.3 % 2.2 % Expected lives (in years) 5.7 5.7 5.6 0.5 0.5 0.5 Expected dividend 0 % 0 % 0 % 0 % 0 % 0 % Expected volatility 44 % 44 % 44 % 44 % 47 % 43 % The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for the expected life of the award. Our computation of expected life was determined based on our historical experience with similar awards, giving consideration to the contractual terms of the share-based awards, vesting schedules and expectations of future employee behavior. A forfeiture rate is estimated at the time of grant to reflect the amount of awards that are granted but are expected to be forfeited by the award holder prior to vesting. The estimated forfeiture rate applied to these amounts is derived from historical stock award forfeiture behavior. We have never paid cash dividends and do not currently intend to pay cash dividends. Our computation of expected volatility is based on the historical volatility of our stock price. The fair value of RSUs is determined based on the closing price of our common stock on the date of grant. Stock option activity A summary of stock option activity is as follows : Shares Weighted- Weighted-average Aggregate Balance at December 31, 2020 7,881,259 $ 62.60 Granted 1,135,689 $ 156.07 Exercised (1,398,901) $ 41.47 Forfeited/expired (243,593) $ 107.48 Balance at December 31, 2021 7,374,454 $ 79.53 5.98 $ 561,783 Expected to vest 7,171,594 $ 77.71 5.89 $ 558,941 Options exercisable 5,057,083 $ 56.86 4.82 $ 496,438 The weighted average grant-date fair values of options granted with exercise prices equal to market were $64.22 , $64.66, and $30.51 for the years ended December 31, 2021, 2020, and 2019, respectively. The aggregate intrinsic value in the table above is calculated as the difference between the exercise price of the underlying options and the quoted price of our common stock for all options that were in-the-money at December 31, 2021. The aggregate intrinsic value of options exercised was $168.7 million during 2021, $271.0 million during 2020, and $128.4 million during 2019, determined as of the date of option exercise. As of December 31, 2021, there was approximately $64.6 million of total unrecognized compensation cost related to unvested options, as adjusted for expected forfeitures. That cost is expected to be recognized over a weighted-average period of 1.30 years . We utilize newly issued shares to satisfy option exercises. RSU activity A summary of RSU activ ity, excluding performance-based RSUs and LTIPs, is as f ollows: Share Weighted- Non-vested at December 31, 2020 2,357,506 $ 105.50 Granted 1,180,665 $ 157.45 Vested (934,049) $ 93.61 Forfeited (245,861) $ 117.01 Non-vested at December 31, 2021 2,358,261 $ 135.07 The weighted average grant-date fair values of RSUs granted were $157.45 , $159.51, and $75.58 for the years ended December 31, 2021, 2020, and 2019, respectively. The total fair value of RSUs that vested during 2021, 2020, and 2019 (measured on the date of vesting) was $149.8 million , $187.1 million, and $67.1 million, respectively. As of December 31, 2021, there was approximately $110.4 million of total unrecognized compensation cost related to non-vested RSU awards, as adjusted for expected forfeitures. That cost is expected to be recognized over a weighted-average period of 1.71 years. We utilize newly issued shares for RSUs that vest. LTIP, performance-based and market-based awards activity We have various LTIPs, which contain performance-based equity compensation, and have granted other performance-based and market-based awards to certain senior leadership. During 2021, an LTIP milestone was achieved related to FDA approval of TIVDAK, which triggered a cash payment and an RSU grant to eligible participants. The vesting of grants made under that LTIP is time-based and is included in the “RSU activity” table above. During 2020, an LTIP milestone was achieved related to FDA approval of TUKYSA, which triggered vesting of performance-based stock awards previously granted to eligible participants, and an RSU grant to eligible participants. The vesting of the previously granted performance-based stock awards related to this LTIP is included in the table below. The second tranche grant upon milestone achievement and time-based vesting of these awards is included in the " RSU activity " table above. During 2019, an LTIP milestone was achieved related to the FDA approval of PADCEV, which triggered a cash payment to eligible participants and an RSU grant to certain eligible participants. The vesting of grants made under that LTIP is time-based and is included in the “RSU activity” table above. A summary of activity related to our performance-based RSUs and LTIPs is as follows: Share Weighted- Non-vested at December 31, 2020 678,406 $ 128.96 Granted 202,293 $ 161.90 Vested (31) $ 136.87 Forfeited (77,947) $ 127.82 Non-vested at December 31, 2021 802,721 $ 136.10 As of December 31, 2021, the estimated unrecognized compensation cost related to all LTIPs and performance-based awards was approximately $83 million . Employee Stock Purchase Plan |
Employee benefit plan
Employee benefit plan | 12 Months Ended |
Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |
Employee benefit plan | Employee benefit plan We have a 401(k) Plan for all of our U.S. employees. Eligible employees may contribute through payroll deductions, and we may match the employees’ 401(k) contributions, at our discretion and not to exceed a prescribed annual limit. Under this matching program, we contributed $24.8 million in 2021, $18.0 million in 2020, and $11.9 million in 2019. |
Organization and Summary of S_2
Organization and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation |
Use of estimates | Use of estimates The preparation of financial statements in accordance with GAAP requires us to make estimates, assumptions, and judgments that affect the amounts report ed in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. Estimates include those used for revenue recognition, valuation of investments, inventory valuation, accrued liabilities, including those related to the long-term incentive plans and performance-based equity, clinical trials and contingencies, and stock option valuation. |
Cash and cash equivalents | Cash and cash equivalents We consider all highly liquid investments with maturities of three months or less at the date of acquisition to be cash equivalents. |
Non-cash activities | Non-cash activities |
Investments | Investments We hold certain equity securities which are reported at estimated fair value based on quoted market prices. Chang es in the fair value of equity securities are recorded in income or loss. The cost of equity securities for purposes of computing gains and losses is based on the specific identification method. We invest our available cash primarily in debt securities. These debt securities are classified as available-for-sale, which are reported at estimated fair value with unrealized gains and losses included in accumulated other comprehensive income (loss) in stockholders’ equity. Realized gains, realized losses and declines in the value of debt securities judged to be other-than-temporary are included in investment and other income, net. The cost of debt securities for purposes of computing realized and unrealized gains and losses is based on the specific identification method. Amortization of premiums and accretion of discounts on debt securities are included in investment and other income, net. Interest and dividends earned are included in investment and other income, net. Accrued interest receivable as of December 31, 2021 and 2020, were $0.4 million and $5.3 million, respectively, and were included in prepaid expenses and other current assets. We classify investments in debt securities maturing within one year of the reporting date, or where management’s intent is to use the investments to fund current operations or to make them available for current operations, as short-term investments. If the estimated fair value of a debt security is below its carrying value, we evaluate whether it is more likely than not that we will sell the security before its anticipated recovery in market value and whether evidence indicating that the cost of the investment is recoverable within a reasonable period of time outweighs evidence to the contrary. We also evaluate whether or not we intend to sell the investment. If the impairment is considered to be other-than-temporary, the security is written down to its estimated fair value. In addition, we consider whether credit losses exist for any securities. A credit loss exists if the present value of cash flows expected to be collected is less than the amortized cost basis of the security. Other-than-temporary declines in estimated fair value and credit losses are included in investment and other income, net. |
Fair value of financial instruments | Fair value of financial instruments The recorded amounts of certain financial instruments, including cash and cash equivalents, interest receivable, accounts receivable, accounts payable and accrued liabilities approximate fair value due to their relatively short maturities. Investments that are classified as available-for-sale are recorded at estimated fair value. The estimated fair value for securities held is determined using quoted market prices, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency. |
Leases | Leases We determine if an arrangement is a lease at inception d ate. All of our currently effective leases are classified as operating leases. Operating lease liabilities and the corresponding right-of-use assets are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. The operating lease right-of-use asset also excludes lease incentives and initial direct costs incurred. As our existing leases do not contain an implicit interest rate, we estimate our incremental borrowing rate based on information available a t commencement date in determining the present value of future payments. We include options to extend the lease in our lease liability and right-of-use asset when it is reasonably certain that we will exercise that option. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Variable lease cost primarily includes building operating expenses as charged to us by our landlords. |
Inventories | Inventories We consider regulatory approval of product candidates to be uncertain. Accordingly, we charge manufacturing costs to research and development expense until such time as a product has received regulatory approval for commercial sale. Production costs for our marketed products are capitalized into inventory. Inventory that is deployed for clinical, research or development use is charged to research and development expense when it is no longer available for commercial sales. Production costs for our other product candidates are charged to research and development expense. We value our inventories at the lower of cost or market value. Cost is determined on a specific identification basis. Inventory includes the cost of materials, third-party contract manufacturing and overhead associated with the production of our commercialized products. In the event that we identify excess, obsolete or unsalable inventory, its value is written down to net realizable value. |
Property and equipment | Property and equipment Property and equipment are stated at cost. Land is not depreciated, while all other property and equipment are depreciated using the straight-line method over the estimated useful lives of the assets, which are generally as follows: Years Building and improvements 20-30 Laboratory and manufacturing equipment 5-15 Furniture and fixtures 5 Computers, software and office equipment 3 |
Intangible assets, net | Intangible assets, netOur intangible assets are primarily comprised of acquired TUKYSA technology. Upon FDA approval and commercial launch of TUKYSA in April 2020, we classified in-process research and development costs related to the acquired TUKYSA technology as finite-lived intangible assets. |
Goodwill | Goodwill We evaluate goodwill for impairment annually, as of October 1, or more frequently when events or circumstances indicate that impairment may have occurred. As part of the impairment evaluation, we may elect to perform an assessment of qualitative factors. If this qualitative assessment indicates that it is more likely than not that the fair value of the reporting unit (for goodwill) is less than its carrying value, we then would proceed with the quantitative impairment test to compare the fair value to the carrying value and record an impairment charge if the carrying value exceeds the fair value. |
Impairment of long-lived assets | Impairment of long-lived assetsWe assess the impairment of long-lived assets, including intangible assets and property and equipment, whenever events or changes in business circumstances indicate that the carrying amounts of the assets may not be fully recoverable. When such events occur, we determine whether there has been an impairment in value by comparing the asset’s carrying value with its fair value, as measured by the anticipated undiscounted net cash flows of the asset. If an impairment in value exists, the asset is written down to its estimated fair value. |
Revenue recognition | Revenue recognition - Net product sales We sell our products primarily thr ough a limited number of specialty distributors and specialty pharmacies in the U.S, and to a lesser extent, internationally. The delivery of our products represents a single performance obligation for these transactions and we record net product sales at the point in time when control is transferred to the customer, which generally occurs upon receipt by the customer. The transaction price for net product sales represents the amount we expect to receive, which is net of estimated government-mandated rebates and chargebacks, distribution fees, estimated product returns, and other deductions. Accruals are established for these deductions, and actual amounts incurred are offset against applicable accruals. We reflect these accruals as either a reduction in the related account receivable from the distributor or as an accrued liability, depending on the nature of the sales deduction. Sales deductions are based on management’s estimates that consider payor mix in target markets and experience to-date. These estimates involve a substantial degree of judgment. Outside of the U.S., the transaction price for net product sales represents the amount we expect to receive, which is net of estimated discounts, estimated government mandated rebates, distribution fees, estimated product returns, and other deductions. Accruals are established for these deductions, and actual amounts incurred are offset against applicable accruals. These estimates involve judgment in estimating net product sales. U.S. government-mandated rebates and chargebacks : We have entered into a Medicaid Drug Rebate Agreement, or MDRA, with the Centers for Medicare & Medicaid Services. This agreement provides for a rebate based on covered purchases of our products. Medicaid rebates are invoiced to us by the various state Medicaid programs. We estimate Medicaid rebates using the expected value approach, based on a variety of factors, including payor mix and our experience to-date. We have a Federal Supply Schedule, or FSS, agreement under which certain U.S. government purchasers receive a discount on eligible purchases of our products. In addition, we have entered into a Pharmaceutical Pricing Agreement with the Secretary of Health and Human Services, which enables certain entities that qualify for government pricing under the Public Health Services Act, or PHS, to receive discounts on their qualified purchases of our products. Under these agreements, distributors process a chargeback to us for the difference between wholesale acquisition cost and the applicable discounted price. We estimate expected chargebacks for FSS and PHS purchases based on the expected value of each entity’s eligibility for the FSS and PHS programs. We also review historical rebate and chargeback information to further refine these estimates. Distribution fees, product returns and other deductions : Our distributors charge a volume-based fee for distribution services that they perform for us. We allow for the return of product that is within a specified number of days of its expiration date or that is damaged. We estimate product returns based on our experience to-date using the expected value approach. We provide financial assistance to qualifying patients that are underinsured or cannot cover the cost of commercial coinsurance amounts through our patient support programs. Estimated contributions for commercial coinsurance under Seagen Secure are deducted from gross sales and are based on an analysis of expected plan utilization. These estimates are adjusted as necessary to reflect our actual experience. Revenue recognition - Royalty revenues Royalty revenues primarily reflect amounts earned under the ADCETRIS collaboration with Takeda Pharmaceutical Company Limited, or Takeda. These royalties include commercial sales-based milestones and sales royalties that relate predominantly to the license of intellectual property. Sales royalties are based on a percentage of Takeda’s net sales of ADCETRIS, with rates that range from the mid-teens to the mid-twenties based on annual net sales tiers. Takeda bears a portion of low single digit third-party royalty costs owed on its sales of ADCETRIS. This amount is included in royalty revenues. Amounts owed to our third-party licensors related to Takeda’s sales of ADCETRIS are recorded in cost of sales. These amounts are recognized in the period in which the related sales by Takeda occur. Royalty revenues also reflect amounts from Genentech, Inc., a member of the Roche Group, or Genentech, earned on net sales of Polivy, and amounts from GlaxoSmithKline earned on net sales of Blenrep. Revenue recognition - Collaboration and license agreement revenues We have collaboration and license agreements for our technology with a number of biotechnology and pharmaceutical companies. Under these agreements, we typically receive or are entitled to receive upfront cash payments and progress- and sales-dependent milestones for the achievement by our licensees of certain events, and annual maintenance fees and support fees for research and development services and materials provided under the agreements. We also are entitled to receive royalties on net sales of any resulting products incorporating our technology. Generally, our licensees are solely responsible for research, product development, manufacturing and commercialization of any product candidates under these collaborations, which includes the achievement of the potential milestones. Since we may not take a substantive role or control the research, development or commercialization of any products generated by some of our licensees, we may not be able to reasonably estimate when, if at all, any potential future milestone payments or royalties may be payable to us by our licensees. As such, the potential future milestone payments associated with certain of our collaboration and license agreements involve a substantial degree of uncertainty and risk that they may never be received. Collaboration and license agreements are initially evaluated as to whether the intellectual property licenses granted by us represent distinct performance obligations. If they are determined to be distinct, the value of the intellectual property licenses would be recognized up-front while the research and development service fees would be recognized as the performance obligations are satisfied. Variable consideration is assessed at each reporting period as to whether it is not subject to future reversal of cumulative revenue and, therefore, should be included in the transaction price. Assessing the recognition of variable consideration requires significant judgment. If a contract includes a fixed or minimum amount of research and development support, this also would be included in the transaction price. Changes to collaboration and license agreements, such as the extensions of the research term or increasing the number of targets or technology covered under an existing agreement, are assessed for whether they represent a modification or should be accounted for as a new contract. We have concluded that the license of intellectual property in certain collaboration and license agreements is not distinct from the perspective of our customers at the time of initial transfer, since we often do not license intellectual property without related technology transfer and research and development support services. Such evaluation requires significant judgment since it is made from the customer's perspective. Our performance obligations under our collaborations may include such things as providing intellectual property licenses, performing technology transfer, performing research and development consulting services, providing reagents, ADCs, and other materials, and notifying the customer of any enhancements to licensed technology or new technology that we discover, among others. We determined our performance obligations under certain collaboration and license agreements as evaluated at contract inception were not distinct and represented a single performance obligation. Upfront payments are amortized to revenue over the performance period. Upfront payment contract liabilities resulting from our collaborations do not represent a financing component as the payment is not financing the transfer of goods or services, and the technology underlying the licenses granted reflects research and development expenses already incurred by us. For agreements beyond the initial performance period, we have no remaining performance obligations. We may receive license maintenance fees and potential milestones and royalties based on collaborator development and regulatory progress, which are recorded in the period achieved in the case of milestones, and during the period of the related sales for royalties. When no performance obligations are required of us, or following the completion of the performance obligation period, such amounts are recognized upon transfer of control of the goods or services to the customer. Generally, all amounts received or due other than sales-based milestones and royalties are classified as collaboration and license agreement revenues. Sales-based milestones and royalties are recognized as royalty revenue in the period the related sale occurred. We generally invoice our collaborators and licensees on a monthly or quarterly basis, or upon the completion of the effort or achievement of a milestone, based on the terms of each agreement. Deferred revenue arises from amounts received in advance of the culmination of the earnings process and is recognized as revenue in future periods as performance obligations are satisfied. Deferred revenue expected to be recognized within the next twelve months is classified as a current liability. |
Research and development expenses | Research and development expenses Research and development, or R&D, expenses consist of salaries, benefits and other headcount-related costs of our R&D staff, preclinical activities, clinical trials and related manufacturing costs, lab supplies, contract and outside service fees and facilities and overhead expenses for research, development and preclinical studies focused on drug discovery, development and testing. R&D activities are expensed as incurred. Clinical trial expenses are a significant component of research and development expenses, and we outsource a significant portion of these costs to third parties. Third-party clinical trial expenses include investigator fees, site costs, clinical research organization costs, and costs for central laboratory testing and data management. Costs associated with activities performed under co-development collaborations are reflected in R&D expense. In-licensing fees, milestones, maintenance fees and other costs to acquire technologies utilized in R&D for product candidates that have not yet received regulatory approval and that are not expected to have alternative future use are expensed when incurred. Non-refundable advance payments for goods or services that will be used or rendered for future R&D activities are capitalized and recognized as expense as the related goods are delivered or the related services are performed. This results in the temporary deferral of recording expense for amounts incurred for research and development activities from the time payments are made until the time goods or services are provided. |
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Concentration of credit risk | Concentration of credit risk Cash, cash equivalents and investments are invested in accordance with our investment policy. The policy includes guidelines for the investment of cash reserves and is reviewed periodically to minimize credit risk. Most of our investments are in U.S. Treasury securities and are not federally insured. We have accounts receivable from the sale of our products from a small number of distributors, and from our collaborators. We do not require collateral on amounts due from our distributors or our collaborators and are therefore subject to credit risk. |
Allowance for doubtful accounts | Allowance for doubtful accounts We estimate an allowance for doubtful accounts based on our assessment of the collectability of customer accounts. We regularly review the allowance by considering factors such as historical experience, credit quality, the age of the accounts receivable balances, and current economic conditions that may affect a customer’s ability to pay. |
Geographic and customer information | Geographic and customer information Net product revenues are attributed to countries based on the location of the customer. Royalty revenues and collaboration and licenses agreements revenues are attributed to countries based on the location of the Company’s subsidiary associated with the royalty or collaborative arrangement related to such revenues. Over 90% of our revenues and assets are related to operations in the U.S. for all periods presented; however, we have multiple subsidiaries in foreign jurisdictions, including several subsidiaries in Europe. We sell our products throug h a limited nu mber of d |
Major suppliers | Major suppliers The use of a relatively small number of contract manufacturers to supply drug necessary for our commercial and clinical operations create a concentration of risk for us. While primarily one source of supply is utilized for certain components of our approved products and our clinical product candidates, other sources are available should we need to change suppliers. For PADCEV, in particular, we rely on Astellas for both commercial and clinical supply as Astellas oversees the manufacturing supply chain. As a form of reducing near-term risk, we endeavor to maintain reasonable levels of drug supply inventory across the supply chain. A change in suppliers or disruption at one of our suppliers, however, could cause a delay or interruption in delivery of drug or clinical trials. Such an event would adversely affect our business. |
Income taxes | Income taxes We recognize deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Deferred tax assets and liabilities are determined based on the differences between the financial statement and tax bases of assets and liabilities using tax rates in effect for the year in which the differences are expected to reverse. We have provided a valuation allowance against substantially all our deferred tax assets for all periods presented. A valuation allowance is recorded when it is more likely than not that some portion or all of the net deferred tax asset will not be realized. Future realization of deferred tax assets is dependent upon a number of factors, including the existence of sufficient taxable income based on future earnings, the timing and amount of which is uncertain. The assessment regarding whether a valuation allowance is required considers the evaluation of both positive and negative evidence when concluding whether it is more likely than not that deferred tax assets are realizable. Based upon a review of all available evidence, we determined that it is not more likely than not that the U.S. deferred tax assets will be realized, and therefore the deferred tax assets have been fully offset by a valuation allowance. We follow the guidance related to accounting for uncertainty in income taxes, which requires the recognition of an uncertain tax position when it is more likely than not to be sustainable upon audit by the applicable taxing authority. If this threshold is met, the tax benefit is then measured and recognized at the largest amount that is greater than 50% likely of being realized upon ultimate settlement. |
Share-based compensation | Share-based compensation We use the graded-vesting attribution method for recognizing compensation expense for our stock options and restricted stock units, or RSUs. Compensation expense is recognized over the requisite service periods on awards ultimately expected to vest and reduced for forfeitures that are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. For performance-based stock options and RSUs, we record compensation expense over the estimated service period once the achievement of the performance-based milestone is considered probable. At each reporting date, we assess whether achievement of a milestone is considered probable, and if so, record compensation expense based on the portion of the service period elapsed to date with respect to that milestone, with a cumulative catch-up, net of estimated forfeitures. We will recognize remaining compensation expense with respect to a milestone, if any, over the remaining estimated service period. |
Long-term incentive plans, performance-based and market-based restricted stock awards | Long-term incentive plans, performance-based and market-based restricted stock awards We have established Long-Term Incentive Plans, or LTIPs, and have granted certain senior leadership other performance- and market-based restricted stock awards. The LTIPs and other performance-based compensation restricted stock awards provide eligible employees with the opportunity to receive performance-based incentive compensation, which may be comprised of cash and/or RSUs. The payment of cash and the grant and/or vesting of RSUs are contingent upon the achievement of pre-determined performance goals, which may include regulatory milestones, revenue targets, or total shareholder return compared to our industry peer group. We record compensation expense over the estimated service period for each performance goal subject to the achievement of the performance goal being considered probable in accordance with the provisions of ASC Topic 450--Contingencies. At each reporting date, we assess whether achievement of a performance goal is considered probable and, if so, record compensation expense based on the portion of the service period elapsed to date with respect to that milestone, with a cumulative catch-up, net of estimated forfeitures. We recognize compensation expense with respect to a milestone over the remaining estimated service period. The total estimate of unrecognized compensation expense could change in the future for several reasons, including the addition or termination of employees, the recognition of LTIP compensation expense, or the addition, termination, or modification of an LTIP. |
Comprehensive income (loss) | Comprehensive income (loss) Comprehensive income (loss) is the change in stockholders’ equity from transactions and other events and circumstances other than those resulting from investments by stockholders and distributions to stockholders. Our comprehensive income (loss) is comprised of net income (loss), unrealized gains and losses on available-for-sale securities, net of income tax provision and foreign currency translation adjustments, net of income tax provision. |
Loss contingencies | Loss contingencies We are involved in various legal proceedings in the normal course of business. A loss contingency is recorded if it is probable that an asset has been impaired or a liability has been incurred and the amount of the loss can be reasonably estimated. We evaluate, among other factors, the probability of an unfavorable outcome and our ability to make a reasonable estimate and the amount of the ultimate loss. Loss contingencies that are determined to be reasonably possible, but not probable, are disclosed but not recorded. Legal fees incurred as a result of our involvement in legal procedures are expensed as incurred. |
Certain risks and uncertainties | Certain risks and uncertainties Our revenues are derived from net product sales, royalties, and from collaboration and license agreements. Our products are subject to regulation by the FDA in the U.S. and other regulatory agencies outside the U.S. as well as competition by other pharmaceutical companies. Our collaboration and license agreement revenues are derived from a relatively small number of agreements. Each of these agreements can be terminated by our collaborators at their discretion. We are also subject to risks common to companies in the pharmaceutical industry, including risks and uncertainties related to commercial success and acceptance of our products and our potential future products by patients, physicians and payers, competition from other products, regulatory approvals, regulatory requirements, business combinations and product or product candidate acquisition and in-licensing transactions, and protection of intellectual property. Also, drug development is a lengthy process characterized by a relatively low rate of success. We may commit substantial resources toward developing product candidates that never result in further development, achieve regulatory approvals or achieve commercial success. Likewise, we have committed and expect to continue to commit substantial resources towards additional clinical development of our products in an effort to continue to expand our products' labeled indications of use, and there can be no assurance that we and/or our partners will obtain and maintain the necessary regulatory approvals to market our products for any additional indications. |
Guarantees | Guarantees In the normal course of business, we indemnify our directors, certain employees and other parties, including distributors, collaboration partners, lessors and other parties that perform certain work on behalf of, or for us to take licenses to our technologies. We have agreed to hold these parties harmless against losses arising from our breach of representations or covenants, intellectual property infringement or other claims made against these parties in performance of their work with us. These agreements typically limit the time within which the party may seek indemnification by us and the amount of the claim. It is not possible to prospectively determine the maximum potential amount of liability under these indemnification agreements. Further, each potential claim would be based on the unique facts and circumstances of the claim and the particular provisions of each agreement. |
Recent accounting pronouncements adopted | Recent accounting pronouncements adopted In December 2019, the FASB issued “ASU 2019-12, Simplifying the Accounting for Income Taxes.” The objective of the standard is to improve areas of GAAP by removing certain exceptions permitted by ASC Topic 740-- Income Taxes and clarifying existing guidance to facilitate consistent application. We adopted the standard on January 1, 2021. The adoption of this ASU did not have a material impact on our financial condition, results of operations, cash flows, or financial statement disclosures. |
Organization and Summary of S_3
Organization and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Schedule of Property and Equipment, Estimated Useful Lives | Property and equipment are stated at cost. Land is not depreciated, while all other property and equipment are depreciated using the straight-line method over the estimated useful lives of the assets, which are generally as follows: Years Building and improvements 20-30 Laboratory and manufacturing equipment 5-15 Furniture and fixtures 5 Computers, software and office equipment 3 Property and equipment consisted of the following: December 31, (dollars in thousands) 2021 2020 Leasehold improvements $ 193,635 $ 204,918 Laboratory and manufacturing equipment 104,702 78,724 Building 49,806 23,341 Computers, software and office equipment 52,078 45,141 Furniture and fixtures 17,563 15,825 Land 4,771 4,771 422,555 372,720 Less: accumulated depreciation and amortization (212,482) (176,020) Total $ 210,073 $ 196,700 |
Schedule of Finite-lived Intangible Assets | The following table presents the balances of our finite-lived intangible assets for the periods presented: December 31, (dollars in thousands) 2021 2020 Gross carrying value $ 305,650 $ 305,650 Less: accumulated amortization (45,057) (21,970) Total $ 260,593 $ 283,680 |
Schedule of Amortization Expense | The following table presents our amortization expense related to acquired TUKYSA technology costs, included in cost of sales in our consolidated statements of comprehensive income (loss), for the periods presented: Years ended December 31, (dollars in thousands ) 2021 2020 2019 Amortization expense $ 23,087 $ 16,345 $ — |
Schedule of Percent of Revenue Associated with Each Major Distributor or Collaborator | The following table presents each major distributor or collaborator that comprised more than 10% of total revenue: Years ended December 31, 2021 2020 2019 Distributor A 36 % 18 % 26 % Distributor B 27 % 15 % 21 % Distributor C 17 % 10 % 18 % Collaborator A 9 % 7 % 27 % Collaborator B — % 45 % — % |
Schedule of Concentration of Accounts Receivable Attributable to Certain Major Distributors | The following table presents each major distributor or collaborator that accounted for more than 10% of accounts receivable: December 31, 2021 2020 Distributor A 29 % 32 % Distributor B 22 % 25 % Distributor C 16 % 16 % Collaborator A 11 % 13 % |
Revenue from contracts with c_2
Revenue from contracts with customers (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Collaboration and License Agreement Revenues by Collaborator | The following table presents our disaggregated revenue for the years presented. Years ended December 31, (dollars in thousands) 2021 2020 2019 ADCETRIS $ 705,561 $ 658,577 $ 627,733 PADCEV 339,918 222,436 244 TUKYSA 333,952 119,585 — TIVDAK 6,135 — — Net product sales $ 1,385,566 $ 1,000,598 $ 627,977 Royalty revenues $ 150,523 $ 126,756 $ 138,491 Collaboration and license agreement revenues $ 38,282 $ 1,048,182 $ 150,245 Total revenues $ 1,574,371 $ 2,175,536 $ 916,713 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Summary of Supplemental Operating Lease Information | Supplemental operating lease information was as follows: Years ended December 31, (dollars in thousands, except term and rate ) 2021 2020 2019 Operating lease cost $ 16,219 $ 15,013 $ 13,590 Variable lease cost 4,227 3,937 2,958 Total lease cost $ 20,446 $ 18,950 $ 16,548 Cash paid for amounts included in measurement of lease liabilities $ 16,814 $ 14,265 $ 10,197 As of December 31, 2021 2020 Weighted average remaining lease term (in years) 5.87 6.16 Weighted average discount rate 5.0 % 5.2 % |
Summary of Operating Lease Assets and Liabilities | Operating lease liabilities were recorded in the following captions of our consolidated balance sheet as follows: As of December 31, (dollars in thousands ) 2021 2020 Accrued liabilities and other $ 13,905 $ 12,749 Operating lease liabilities, long-term 56,665 61,884 Total $ 70,570 $ 74,633 |
Schedule of Future Minimum Lease Payments | As of December 31, 2021, future minimum lease payments under the lease agreements were as follows: (dollars in thousands) Years ending December 31, 2022 $ 17,088 2023 16,375 2024 12,333 2025 8,489 2026 7,999 Thereafter 19,718 Total future minimum lease payments 82,002 Less: imputed interest (11,432) Total $ 70,570 |
Fair Value (Tables)
Fair Value (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Hierarchy | The three levels of the fair value hierarchy are: Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. Level 2: Quoted prices in markets that are not active or financial instruments for which all significant inputs are observable, either directly or indirectly. Level 3: Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable. |
Summary of Fair Value Hierarchy of Assets Carried at Fair Value and Measured on a Recurring Basis | The fair value hierarchy of assets carried at fair value and measured on a recurring basis was as follows: Fair value measurement using: (dollars in thousands) Quoted prices Other Significant Total December 31, 2021 Short-term investments—U.S. Treasury securities $ 1,735,202 $ — $ — $ 1,735,202 Other non-current assets—equity securities 14,009 — — 14,009 Total $ 1,749,211 $ — $ — $ 1,749,211 December 31, 2020 Short-term investments—U.S. Treasury securities $ 2,000,996 $ — $ — $ 2,000,996 Long-term investments—U.S. Treasury securities 100,830 — — 100,830 Total $ 2,101,826 $ — $ — $ 2,101,826 |
Available-for-Sale Securities | Our debt securities consisted of the following: (dollars in thousands) Amortized Gross Gross Fair December 31, 2021 U.S. Treasury securities $ 1,735,388 $ 12 $ (198) $ 1,735,202 Contractual maturities (at date of purchase): Due in one year or less $ 1,635,307 $ 1,635,118 Due in one to two years 100,081 100,084 Total $ 1,735,388 $ 1,735,202 December 31, 2020 U.S. Treasury securities $ 2,101,801 $ 259 $ (234) $ 2,101,826 Contractual maturities (at date of purchase): Due in one year or less $ 1,791,399 $ 1,791,239 Due in one to two years 310,402 310,587 Total $ 2,101,801 $ 2,101,826 |
Investment and Other Income, _2
Investment and Other Income, Net (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Investment and Other Income, Net | Investment and other income, net consisted of the following: Years ended December 31, (dollars in thousands) 2021 2020 2019 Gain on equity securities $ 4,744 $ 11,604 $ 50,124 Investment and other income, net 1,607 7,245 11,771 Total investment and other income, net $ 6,351 $ 18,849 $ 61,895 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories consisted of the following: December 31, (dollars in thousands) 2021 2020 Raw materials $ 12,181 $ 3,799 Work in process 152,635 95,250 Finished goods 35,847 17,087 Total $ 200,663 $ 116,136 |
Property and equipment (Tables)
Property and equipment (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment are stated at cost. Land is not depreciated, while all other property and equipment are depreciated using the straight-line method over the estimated useful lives of the assets, which are generally as follows: Years Building and improvements 20-30 Laboratory and manufacturing equipment 5-15 Furniture and fixtures 5 Computers, software and office equipment 3 Property and equipment consisted of the following: December 31, (dollars in thousands) 2021 2020 Leasehold improvements $ 193,635 $ 204,918 Laboratory and manufacturing equipment 104,702 78,724 Building 49,806 23,341 Computers, software and office equipment 52,078 45,141 Furniture and fixtures 17,563 15,825 Land 4,771 4,771 422,555 372,720 Less: accumulated depreciation and amortization (212,482) (176,020) Total $ 210,073 $ 196,700 |
Accrued liabilities (Tables)
Accrued liabilities (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued liabilities | Accrued liabilities consisted of the following : December 31, (dollars in thousands) 2021 2020 Employee compensation and benefits $ 139,052 $ 96,902 Clinical trial and related costs 122,468 69,756 Contract manufacturing 21,867 20,765 Gross-to-net deductions and third-party royalties 81,316 52,565 Other 89,327 70,083 Total $ 454,030 $ 310,071 |
Income taxes (Tables)
Income taxes (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of Company's Pre-tax Loss by Jurisdiction | Our income (loss) before income taxes by jurisdiction consisted of the following: Years ended December 31, (dollars in thousands) 2021 2020 2019 U.S. $ (680,398) $ 613,054 $ (160,189) Foreign 4,693 2,647 1,539 Total $ (675,705) $ 615,701 $ (158,650) |
Schedule of Effective Income Tax Rate | A reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows: Years ended December 31, 2021 2020 2019 Statutory federal income tax rate 21.0 % 21.0 % 21.0 % Tax credits 7.2 (5.4) 11.0 State income taxes and other 4.6 1.5 4.7 Valuation allowance (35.7) (8.4) (37.1) Stock compensation 3.1 (8.4) 6.4 Non-deductible asset basis — — (6.0) Effective tax rate 0.2 % 0.3 % 0.0 % |
Schedule of Deferred Tax Assets | Our net deferred tax assets consisted of the following: December 31, (dollars in thousands) 2021 2020 Deferred tax assets: Net operating loss carryforwards $ 331,284 $ 228,041 Foreign net operating loss carryforwards 7,566 8,341 Tax credit carryforwards 278,925 224,233 Share-based compensation 41,087 33,315 Allowance and accruals 47,119 29,355 Operating lease liabilities 16,461 16,596 Inventory 14,629 19,402 Capitalized research and development 6,947 4,139 Intangibles and amortization 5,399 — Total deferred tax assets 749,417 563,422 Less: valuation allowance (730,130) (489,519) Total deferred tax assets, net of valuation allowance 19,287 73,903 Deferred tax liability: Right-of-use assets (13,434) (13,647) Intangibles and amortization — (46,018) Depreciation (3,428) (10,215) Other (920) (1,970) Net deferred tax assets $ 1,505 $ 2,053 |
Schedule of Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits was as follows: Years ended December 31, (dollars in thousands) 2021 2020 2019 Balance at January 1 $ 23,078 $ 24,018 $ 20,706 Increase (decrease) related to prior year tax positions 1,894 (4,008) — Increase related to current year tax positions 5,334 3,068 3,312 Balance at December 31 $ 30,306 $ 23,078 $ 24,018 |
Commitments and contingencies (
Commitments and contingencies (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Noncancelable Obligations | As of December 31, 2021, our future obligations related to supply and other agreements were as follows: (dollars in thousands) Years ending December 31, 2022 $ 204,328 2023 89,460 2024 62,686 2025 33,016 2026 6,513 Thereafter — Total $ 396,003 |
Stockholders' equity (Tables)
Stockholders' equity (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Equity [Abstract] | |
Schedule of Common Stock Reserved for Future Issuance | At December 31, 2021, shares of common stock reserved for future issuance are as follows: (in thousands) Stock options and RSUs outstanding 10,535 Shares available for future grant under the 2007 Equity Incentive Plan 6,673 Employee stock purchase plan shares available for future issuance 840 Total 18,048 |
Net (loss) income per share (Ta
Net (loss) income per share (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Net (Loss) Income Per Share | Years ended December 31, (dollars in thousands, except per share amounts) 2021 2020 2019 Net (loss) income $ (674,471) $ 613,670 $ (158,650) Weighted average common shares outstanding - basic 182,048 174,834 165,498 Effect of potentially dilutive common shares — 7,453 — Weighted average common shares outstanding - diluted 182,048 182,287 165,498 Net (loss) income per share - basic $ (3.70) $ 3.51 $ (0.96) Net (loss) income per share - diluted $ (3.70) $ 3.37 $ (0.96) |
Schedule of Weighted-Average Shares Excluded from Number of Shares Used to Calculate Basic and Diluted Net Loss Per Share | The following table presents the weighted average number of shares that have been excluded for all periods presented: Years ended December 31, (in thousands) 2021 2020 2019 Stock options and RSUs 10,327 356 12,774 |
Share-based compensation (Table
Share-based compensation (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Share-based Compensation | The following table presents our total share-based compensation expense for the periods presented: Years ended December 31, (dollars in thousands) 2021 2020 2019 Research and development $ 79,715 $ 72,749 $ 64,730 Selling, general and administrative 93,402 74,484 62,619 Total share-based compensation expense 173,117 147,233 127,349 |
Schedule of Stock Options Valuation Assumptions | We calculate the fair value of each option award on the date of grant using the Black-Scholes option pricing model. The following weighted-average assumptions were used for the periods indicated: 2007 Plan Employee Stock Purchase Plan Years ended December 31, Years ended December 31, 2021 2020 2019 2021 2020 2019 Risk-free interest rate 0.8 % 0.3 % 1.5 % 0.1 % 1.3 % 2.2 % Expected lives (in years) 5.7 5.7 5.6 0.5 0.5 0.5 Expected dividend 0 % 0 % 0 % 0 % 0 % 0 % Expected volatility 44 % 44 % 44 % 44 % 47 % 43 % |
Schedule of Stock Option Activity Excluding Performance-Based Stock Options | A summary of stock option activity is as follows : Shares Weighted- Weighted-average Aggregate Balance at December 31, 2020 7,881,259 $ 62.60 Granted 1,135,689 $ 156.07 Exercised (1,398,901) $ 41.47 Forfeited/expired (243,593) $ 107.48 Balance at December 31, 2021 7,374,454 $ 79.53 5.98 $ 561,783 Expected to vest 7,171,594 $ 77.71 5.89 $ 558,941 Options exercisable 5,057,083 $ 56.86 4.82 $ 496,438 |
Schedule of Non-Vested Restricted Stock Units | A summary of RSU activ ity, excluding performance-based RSUs and LTIPs, is as f ollows: Share Weighted- Non-vested at December 31, 2020 2,357,506 $ 105.50 Granted 1,180,665 $ 157.45 Vested (934,049) $ 93.61 Forfeited (245,861) $ 117.01 Non-vested at December 31, 2021 2,358,261 $ 135.07 |
Long Term Incentive Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Non-Vested Restricted Stock Units | A summary of activity related to our performance-based RSUs and LTIPs is as follows: Share Weighted- Non-vested at December 31, 2020 678,406 $ 128.96 Granted 202,293 $ 161.90 Vested (31) $ 136.87 Forfeited (77,947) $ 127.82 Non-vested at December 31, 2021 802,721 $ 136.10 |
Organization and Summary of S_4
Organization and Summary of Significant Accounting Policies - Additional Information (Details) | 12 Months Ended | ||
Dec. 31, 2021USD ($)segment | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Summary Of Significant Accounting Policies [Line Items] | |||
Number of reporting segment operated | segment | 1 | ||
Accrued capital expenditures | $ 9,900,000 | $ 6,000,000 | |
Right-of-use assets in exchange for lease liabilities | 9,100,000 | 7,200,000 | $ 40,300,000 |
Accrued interest receivable | 400,000 | 5,300,000 | |
Estimated future amortization expense, 2022 | 23,100,000 | ||
Estimated future amortization expense, 2023 | 23,100,000 | ||
Estimated future amortization expense, 2024 | 23,100,000 | ||
Estimated future amortization expense, 2025 | 23,100,000 | ||
Impairment losses recognized | 0 | ||
Advertising expenses | 88,800,000 | 59,300,000 | 33,500,000 |
Allowance for doubtful accounts | 0 | 0 | |
Bad debt expense | $ 0 | $ 0 | $ 0 |
Geographic Concentration Risk | Sales Revenue | United States | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Concentration risk, percentage | 90.00% | 90.00% | 90.00% |
Geographic Concentration Risk | Assets | United States | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Concentration risk, percentage | 90.00% | 90.00% | 90.00% |
Weighted Average | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Intangible asset useful life | 11 years |
Organization and Summary of S_5
Organization and Summary of Significant Accounting Policies - Schedule of Property and Equipment, Estimated Useful Lives (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Furniture and fixtures | |
Property, Plant and Equipment [Line Items] | |
Useful life | 5 years |
Computers, software and office equipment | |
Property, Plant and Equipment [Line Items] | |
Useful life | 3 years |
Minimum | Building and improvements | |
Property, Plant and Equipment [Line Items] | |
Useful life | 20 years |
Minimum | Laboratory and manufacturing equipment | |
Property, Plant and Equipment [Line Items] | |
Useful life | 5 years |
Maximum | Building and improvements | |
Property, Plant and Equipment [Line Items] | |
Useful life | 30 years |
Maximum | Laboratory and manufacturing equipment | |
Property, Plant and Equipment [Line Items] | |
Useful life | 15 years |
Organization and Summary of S_6
Organization and Summary of Significant Accounting Policies - Schedule of Intangible Assets (Detail) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Intangible assets | $ 305,650 | $ 305,650 |
Less: accumulated amortization | (45,057) | (21,970) |
Total | $ 260,593 | $ 283,680 |
Organization and Summary of S_7
Organization and Summary of Significant Accounting Policies - Amortization Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Finite-Lived Intangible Assets [Line Items] | |||
Amortization of intangible assets | $ 23,087 | $ 16,345 | $ 15 |
TUKYSA technology costs | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization of intangible assets | $ 23,087 | $ 16,345 | $ 0 |
Organization and Summary of S_8
Organization and Summary of Significant Accounting Policies - Schedule of Percent of Revenue Associated with Each Major Distributor or Collaborator (Details) - Customer Concentration Risk - Sales Revenue | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Distributor A | |||
Concentration Risk [Line Items] | |||
Percent of total revenues | 36.00% | 18.00% | 26.00% |
Distributor B | |||
Concentration Risk [Line Items] | |||
Percent of total revenues | 27.00% | 15.00% | 21.00% |
Distributor C | |||
Concentration Risk [Line Items] | |||
Percent of total revenues | 17.00% | 10.00% | 18.00% |
Collaborator A | |||
Concentration Risk [Line Items] | |||
Percent of total revenues | 9.00% | 7.00% | 27.00% |
Collaborator B | |||
Concentration Risk [Line Items] | |||
Percent of total revenues | 0.00% | 45.00% | 0.00% |
Organization and Summary of S_9
Organization and Summary of Significant Accounting Policies - Schedule of Concentration of Accounts Receivable Attributable to Certain Major Distributors (Details) - Credit Concentration Risk - Accounts Receivable, Net | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Distributor A | ||
Concentration Risk [Line Items] | ||
Percent of total accounts receivable | 29.00% | 32.00% |
Distributor B | ||
Concentration Risk [Line Items] | ||
Percent of total accounts receivable | 22.00% | 25.00% |
Distributor C | ||
Concentration Risk [Line Items] | ||
Percent of total accounts receivable | 16.00% | 16.00% |
Collaborator B | ||
Concentration Risk [Line Items] | ||
Percent of total accounts receivable | 11.00% | 13.00% |
Revenue from contracts with c_3
Revenue from contracts with customers - Summary of Collaboration and License Agreement Revenues by Collaborator (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 1,574,371 | $ 2,175,536 | $ 916,713 |
Net product sales | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 1,385,566 | 1,000,598 | 627,977 |
Net product sales | ADCETRIS | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 705,561 | 658,577 | 627,733 |
Net product sales | PADCEV | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 339,918 | 222,436 | 244 |
Net product sales | TUKYSA | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 333,952 | 119,585 | 0 |
Net product sales | TIVDAK | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 6,135 | 0 | 0 |
Royalty revenues | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 150,523 | 126,756 | 138,491 |
Collaboration and license agreement revenues | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 38,282 | $ 1,048,182 | $ 150,245 |
Revenue from contracts with c_4
Revenue from contracts with customers - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Revenue from Contracts with Customers [Line Items] | |||
Revenue | $ 1,574,371,000 | $ 2,175,536,000 | $ 916,713,000 |
Contract asset | 0 | 0 | |
Contract liability | 0 | 0 | |
Collaboration and License Agreement | |||
Revenue from Contracts with Customers [Line Items] | |||
Deferred revenue recognized | 0 | 0 | 33,600,000 |
Collaboration and license agreement revenues | |||
Revenue from Contracts with Customers [Line Items] | |||
Revenue | $ 38,282,000 | 1,048,182,000 | 150,245,000 |
Collaboration and license agreement revenues | Collaboration and License Agreement | |||
Revenue from Contracts with Customers [Line Items] | |||
Revenue | $ 975,200,000 | ||
BeiGene | Collaboration and license agreement revenues | |||
Revenue from Contracts with Customers [Line Items] | |||
Revenue | $ 20,000,000 |
Leases - Additional Information
Leases - Additional Information (Details) ft² in Thousands, $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Jun. 30, 2021USD ($)ft²aterm | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Leases [Abstract] | ||||
Right-of-use assets in exchange for lease liabilities | $ 9,100 | $ 7,200 | $ 40,300 | |
Lease agreement | ft² | 258 | |||
Rentable building and complex constructed | a | 20.5 | |||
Initial rate | $ 4,000 | 16,814 | 14,265 | 10,197 |
Annual escalations | 3.00% | |||
Initial term | 20 years | |||
Option to extend | term | 2 | |||
Renewal term | 10 years | |||
Rent expense | $ 16,500 | $ 16,600 | $ 14,600 |
Leases - Supplemental Informati
Leases - Supplemental Information (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Jun. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Leases [Abstract] | ||||
Operating lease cost | $ 16,219 | $ 15,013 | $ 13,590 | |
Variable lease cost | 4,227 | 3,937 | 2,958 | |
Total lease cost | 20,446 | 18,950 | 16,548 | |
Cash paid for amounts included in measurement of lease liabilities | $ 4,000 | $ 16,814 | $ 14,265 | $ 10,197 |
Weighted average remaining lease term (in years) | 5 years 10 months 13 days | 6 years 1 month 28 days | ||
Weighted average discount rate | 5.00% | 5.20% |
Leases - Balance Sheet Informat
Leases - Balance Sheet Information (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Leases [Abstract] | ||
Accrued liabilities and other extensible list | Accrued liabilities and other | Accrued liabilities and other |
Accrued liabilities and other | $ 13,905 | $ 12,749 |
Operating lease liabilities, long-term | 56,665 | 61,884 |
Total | $ 70,570 | $ 74,633 |
Leases - Future Minimum Payment
Leases - Future Minimum Payments (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Leases [Abstract] | ||
2022 | $ 17,088 | |
2023 | 16,375 | |
2024 | 12,333 | |
2025 | 8,489 | |
2026 | 7,999 | |
Thereafter | 19,718 | |
Total future minimum lease payments | 82,002 | |
Less: imputed interest | (11,432) | |
Total | $ 70,570 | $ 74,633 |
Fair Value - Summary of Fair Va
Fair Value - Summary of Fair Value Hierarchy of Assets Carried at Fair Value and Measured on a Recurring Basis (Details) - Fair Value Measurements Recurring - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | $ 1,749,211 | $ 2,101,826 |
US Treasury Securities | Short-term Investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 1,735,202 | 2,000,996 |
US Treasury Securities | Other Long-term Investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 100,830 | |
Equity Securities | Other Non-current Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 14,009 | |
Quoted prices in active markets for identical assets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 1,749,211 | 2,101,826 |
Quoted prices in active markets for identical assets (Level 1) | US Treasury Securities | Short-term Investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 1,735,202 | 2,000,996 |
Quoted prices in active markets for identical assets (Level 1) | US Treasury Securities | Other Long-term Investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 100,830 | |
Quoted prices in active markets for identical assets (Level 1) | Equity Securities | Other Non-current Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 14,009 | |
Other observable inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 0 | 0 |
Other observable inputs (Level 2) | US Treasury Securities | Short-term Investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 0 | 0 |
Other observable inputs (Level 2) | US Treasury Securities | Other Long-term Investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 0 | |
Other observable inputs (Level 2) | Equity Securities | Other Non-current Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 0 | |
Significant unobservable inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 0 | 0 |
Significant unobservable inputs (Level 3) | US Treasury Securities | Short-term Investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 0 | 0 |
Significant unobservable inputs (Level 3) | US Treasury Securities | Other Long-term Investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | $ 0 | |
Significant unobservable inputs (Level 3) | Equity Securities | Other Non-current Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | $ 0 |
Fair Value - Additional Informa
Fair Value - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |||
Credit loss | $ 0 | $ 0 | $ 0 |
Allowance for credit loss | $ 0 |
Fair Value - Summary of Debt Se
Fair Value - Summary of Debt Securities (Details) - US Treasury Securities - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Debt Securities, Available-for-sale [Line Items] | ||
Available-for-sale securities, Amortized cost | $ 1,735,388 | $ 2,101,801 |
Available-for-sale securities, Gross unrealized gains | 12 | 259 |
Available-for-sale securities, Gross unrealized losses | (198) | (234) |
Available-for-sale securities, Fair value | 1,735,202 | 2,101,826 |
Debt securities, due in one year or less, amortized cost | 1,635,307 | 1,791,399 |
Debt securities, due in one year or less, fair value | 1,635,118 | 1,791,239 |
Debt securities, due in one to two years, amortized cost | 100,081 | 310,402 |
Debt securities, due in one to two years, fair value | $ 100,084 | $ 310,587 |
Investment and Other Income, _3
Investment and Other Income, Net - Schedule of Investment and Other Income (Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |||
Gain on equity securities | $ 4,744 | $ 11,604 | $ 50,124 |
Investment and other income, net | 1,607 | 7,245 | 11,771 |
Total investment and other income, net | $ 6,351 | $ 18,849 | $ 61,895 |
Inventories - Schedule of Inven
Inventories - Schedule of Inventories (Detail) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 12,181 | $ 3,799 |
Work in process | 152,635 | 95,250 |
Finished goods | 35,847 | 17,087 |
Total | $ 200,663 | $ 116,136 |
Property and equipment - Schedu
Property and equipment - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 422,555 | $ 372,720 |
Less: accumulated depreciation and amortization | (212,482) | (176,020) |
Total | 210,073 | 196,700 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 193,635 | 204,918 |
Laboratory and manufacturing equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 104,702 | 78,724 |
Building and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 49,806 | 23,341 |
Computers, software and office equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 52,078 | 45,141 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 17,563 | 15,825 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 4,771 | $ 4,771 |
Property and equipment - Additi
Property and equipment - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation and amortization expenses | $ 42.9 | $ 36 | $ 23.8 |
Construction in process included in Leasehold improvements | $ 44 | $ 24.5 |
Accrued liabilities (Details)
Accrued liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Payables and Accruals [Abstract] | ||
Employee compensation and benefits | $ 139,052 | $ 96,902 |
Clinical trial and related costs | 122,468 | 69,756 |
Contract manufacturing | 21,867 | 20,765 |
Gross-to-net deductions and third-party royalties | 81,316 | 52,565 |
Other | 89,327 | 70,083 |
Total | $ 454,030 | $ 310,071 |
Income taxes - Schedule of Comp
Income taxes - Schedule of Company's Pre-tax Loss by Jurisdiction (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Noncontrolling Interest [Abstract] | |||
U.S. | $ (680,398) | $ 613,054 | $ (160,189) |
Foreign | 4,693 | 2,647 | 1,539 |
(Loss) income before income taxes | $ (675,705) | $ 615,701 | $ (158,650) |
Income Taxes - Schedule of Effe
Income Taxes - Schedule of Effective Income Tax Rate (Details) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Effective Income Tax Rate Reconciliation, Other Reconciling Items, Percent [Abstract] | |||
Statutory federal income tax rate | 21.00% | 21.00% | 21.00% |
Tax credits | 7.20% | (5.40%) | 11.00% |
State income taxes and other | 4.60% | 1.50% | 4.70% |
Valuation allowance | (35.70%) | (8.40%) | (37.10%) |
Stock compensation | 3.10% | (8.40%) | 6.40% |
Non-deductible asset basis | 0.00% | 0.00% | (6.00%) |
Effective tax rate | 0.20% | 0.30% | 0.00% |
Income taxes - Additional Infor
Income taxes - Additional Information (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Taxes [Line Items] | ||||
(Benefit) provision for income taxes | $ (1,234,000) | $ 2,031,000 | $ 0 | |
Current tax benefit | 1,700,000 | |||
Deferred income taxes | 548,000 | (2,053,000) | 0 | |
Current state tax | 3,700,000 | |||
Foreign tax benefit | 1,700,000 | |||
Valuation allowance | 730,130,000 | 489,519,000 | ||
Increase (decrease) in the valuation allowance | 240,600,000 | (46,800,000) | 58,500,000 | |
Tax credit carryforward | 302,400,000 | |||
Total unrecognized tax benefit | 30,306,000 | 23,078,000 | $ 24,018,000 | $ 20,706,000 |
State | ||||
Income Taxes [Line Items] | ||||
State tax liabilities | $ 3,700,000 | |||
Gross net operating loss carryforwards | 614,400,000 | |||
Federal | ||||
Income Taxes [Line Items] | ||||
Gross net operating loss carryforwards | 1,347,000,000 | |||
Indefinite operating loss carryforwards | 709,000,000 | |||
Operating loss carryforwards, subject to expiration | 638,000,000 | |||
Foreign | ||||
Income Taxes [Line Items] | ||||
Gross net operating loss carryforwards | 38,300,000 | |||
Tax credit carryforward | $ 302,400,000 |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred tax assets: | ||
Net operating loss carryforwards | $ 331,284 | $ 228,041 |
Foreign net operating loss carryforwards | 7,566 | 8,341 |
Tax credit carryforwards | 278,925 | 224,233 |
Share-based compensation | 41,087 | 33,315 |
Allowance and accruals | 47,119 | 29,355 |
Operating lease liabilities | 16,461 | 16,596 |
Inventory | 14,629 | 19,402 |
Capitalized research and development | 6,947 | 4,139 |
Intangibles and amortization | 5,399 | 0 |
Total deferred tax assets | 749,417 | 563,422 |
Less: valuation allowance | (730,130) | (489,519) |
Total deferred tax assets, net of valuation allowance | 19,287 | 73,903 |
Deferred tax liability: | ||
Right-of-use assets | (13,434) | (13,647) |
Intangibles and amortization | 0 | (46,018) |
Depreciation | (3,428) | (10,215) |
Other | (920) | (1,970) |
Net deferred tax assets | $ 1,505 | $ 2,053 |
Income Taxes - Schedule of Reco
Income Taxes - Schedule of Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Reconciliation of the Beginning and Ending Amount of Unrecognized Tax Benefits | |||
Balance at January 1 | $ 23,078 | $ 24,018 | $ 20,706 |
Increase (decrease) related to prior year tax positions | 1,894 | 0 | |
Increase (decrease) related to prior year tax positions | (4,008) | ||
Increase related to current year tax positions | 5,334 | 3,068 | 3,312 |
Balance at December 31 | $ 30,306 | $ 23,078 | $ 24,018 |
Collaboration and license agr_2
Collaboration and license agreements (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Oct. 31, 2020USD ($)$ / sharesshares | Sep. 30, 2020USD ($)agreement | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Sep. 30, 2021USD ($) | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Cost of sales | $ 311,565 | $ 217,720 | $ 43,952 | |||
Number of agreements entered into | agreement | 2 | |||||
Shares issued (in shares) | shares | 5,000,000 | |||||
Price per share (in dollars per share) | $ / shares | $ 200 | |||||
Proceeds from sale of stock | $ 1,000,000 | |||||
Revenue | 1,574,371 | 2,175,536 | 916,713 | |||
Fair value of shares issued | 749,900 | 749,850 | 548,691 | |||
Collaboration and license agreement revenues | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Revenue | 38,282 | 1,048,182 | 150,245 | |||
Collaboration and License Agreement | Collaboration and license agreement revenues | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Revenue | 975,200 | |||||
Collaborative Arrangement | RemGen Co | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Upfront payment to collaborator | $ 200,000 | |||||
Collaborative Arrangement | RemGen Co | Development Goals | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Potential milestone payments to collaborator | 195,000 | |||||
Collaborative Arrangement | RemGen Co | Regulatory and Commercialization Goals | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Potential milestone payments to collaborator | $ 2,200,000 | |||||
Astellas Collaboration and License Agreements | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Third party research and development expenses incurred | 145,400 | 99,300 | 76,800 | |||
PADCEV | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Cost of sales | 159,000 | 104,600 | ||||
Genmab Collaboration and License Agreements | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Third party research and development expenses incurred | $ 63,700 | 50,100 | $ 48,500 | |||
Percentage of sales representatives and medical science liaisons maintained by company | 50.00% | |||||
Percentage of costs entity is responsible for | 50.00% | |||||
L V Agreement | Collaboration and License Agreement | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Percentage of costs entity is responsible for | 50.00% | |||||
Upfront cash payment received | $ 600,000 | |||||
Milestone payment (up to) | 850,000 | |||||
Milestone payment upon achievement of annual sales threshold (up to) | $ 1,750,000 | |||||
Percentage of profits to be received | 50.00% | |||||
TUKYSA Agreement | Collaboration and License Agreement | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Upfront cash payment received | $ 125,000 | |||||
Milestone payment (up to) | 65,000 | |||||
Revenue | 725,000 | |||||
Prepaid research and development expense | $ 85,000 | |||||
TUKYSA Agreement | Collaboration and License Agreement | Accrued Liabilities | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Co-development liability | $ 40,200 | 30,100 | ||||
TUKYSA Agreement | Collaboration and License Agreement | Other Long-Term Liabilities | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Co-development liability | $ 15,100 | $ 50,800 | ||||
Purchase Agreement | Collaboration and license agreement revenues | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Revenue | $ 250,100 |
In-license agreements (Details)
In-license agreements (Details) | 12 Months Ended |
Dec. 31, 2021agreement | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Number of licensing agreements | 2 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) $ in Thousands | Dec. 31, 2021USD ($) |
Contractual Obligation, Fiscal Year Maturity [Abstract] | |
2022 | $ 204,328 |
2023 | 89,460 |
2024 | 62,686 |
2025 | 33,016 |
2026 | 6,513 |
Thereafter | 0 |
Total | $ 396,003 |
Legal matters (Details)
Legal matters (Details) | 1 Months Ended |
Jan. 22, 2021petition | |
Commitments and Contingencies Disclosure [Abstract] | |
Number of petitions filed | 2 |
Stockholders' equity - Addition
Stockholders' equity - Additional information (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Oct. 31, 2020 | Jul. 31, 2019 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Subsidiary, Sale of Stock [Line Items] | |||||
Shares issued (in shares) | 5,000,000 | ||||
Price per share (in dollars per share) | $ 200 | ||||
Proceeds from sale of stock | $ 1,000,000 | ||||
Fair value of shares issued | 749,900 | $ 749,850 | $ 548,691 | ||
Revenue | $ 1,574,371 | 2,175,536 | 916,713 | ||
Collaboration and license agreement revenues | |||||
Subsidiary, Sale of Stock [Line Items] | |||||
Revenue | $ 38,282 | $ 1,048,182 | $ 150,245 | ||
Collaboration and license agreement revenues | Purchase Agreement | |||||
Subsidiary, Sale of Stock [Line Items] | |||||
Revenue | $ 250,100 | ||||
Underwritten Public Offering | |||||
Subsidiary, Sale of Stock [Line Items] | |||||
Shares issued (in shares) | 8,214,286 | ||||
Price per share (in dollars per share) | $ 70 | ||||
Proceeds from sale of stock | $ 548,700 |
Stockholders' equity - Schedule
Stockholders' equity - Schedule of Common Stock Reserved for Future Issuance (Details) shares in Thousands | Dec. 31, 2021shares |
Equity [Abstract] | |
Stock options and RSUs outstanding (in shares) | 10,535 |
Shares available for future grant under the 2007 Equity Incentive Plan (in shares) | 6,673 |
Employee stock purchase plan shares available for future issuance (in shares) | 840 |
Total common stock reserved for future issuance (in shares) | 18,048 |
Net (loss) income per share - S
Net (loss) income per share - Schedule of net (loss) income per share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |||
Net (loss) income | $ (674,471) | $ 613,670 | $ (158,650) |
Weighted average common shares outstanding - basic (in shares) | 182,048 | 174,834 | 165,498 |
Effect of potentially dilutive common shares (in shares) | 0 | 7,453 | 0 |
Weighted average common shares outstanding - diluted (in shares) | 182,048 | 182,287 | 165,498 |
Net (loss) income per share - basic (in dollars per share) | $ (3.70) | $ 3.51 | $ (0.96) |
Net (loss) income per share - diluted (in dollars per share) | $ (3.70) | $ 3.37 | $ (0.96) |
Net (loss) income per share - A
Net (loss) income per share - Antidilutive shares (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Stock options and RSUs | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted-average shares that have been excluded (in shares) | 10,327 | 356 | 12,774 |
Share-based compensation - 2007
Share-based compensation - 2007 Equity Incentive Plan - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2021shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Additional shares reserved for issuance by plan amendment (in shares) | 6,000,000 |
2007 Equity Incentive Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Common stock reserved for issuance (in shares) | 39,000,000 |
Minimum percentage of exercise price stock at grant date fair market value | 100.00% |
Maximum term from date of grant, years | 10 years |
Share-based Payment Arrangement, Employee | 2007 Equity Incentive Plan | Share-based Payment Arrangement, Option | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Initial vesting period, percentage | 25.00% |
Initial vesting period, years | 1 year |
Subsequent vesting period, years | 36 months |
Share-based Payment Arrangement, Employee | 2007 Equity Incentive Plan | Restricted Stock Units (RSUs) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Initial vesting period, percentage | 25.00% |
Share-based Payment Arrangement, Nonemployee | 2007 Equity Incentive Plan | Restricted Stock Units (RSUs) | Board Of Directors | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Vesting period | 1 year |
Share-based compensation - Shar
Share-based compensation - Share-based compensation expense - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share based compensation cost | $ 173,117,000 | $ 147,233,000 | $ 127,349,000 |
Share-based compensation tax benefit | 0 | 55,700,000 | 0 |
Research and development | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share based compensation cost | 79,715,000 | 72,749,000 | 64,730,000 |
Selling, general and administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share based compensation cost | $ 93,402,000 | $ 74,484,000 | $ 62,619,000 |
Share-based compensation - Sche
Share-based compensation - Schedule of Stock Options Valuation Assumptions (Details) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
2007 Equity Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free interest rate | 0.80% | 0.30% | 1.50% |
Expected lives (in years) | 5 years 8 months 12 days | 5 years 8 months 12 days | 5 years 7 months 6 days |
Expected dividend | 0.00% | 0.00% | 0.00% |
Expected volatility | 44.00% | 44.00% | 44.00% |
Employee Stock Purchase Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free interest rate | 0.10% | 1.30% | 2.20% |
Expected lives (in years) | 6 months | 6 months | 6 months |
Expected dividend | 0.00% | 0.00% | 0.00% |
Expected volatility | 44.00% | 47.00% | 43.00% |
Share-based compensation - Sc_2
Share-based compensation - Schedule of Stock Option Activity (Details) - 2007 Equity Incentive Plan - Option Plan $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2021USD ($)$ / sharesshares | |
Shares | |
Beginning balance, shares (in shares) | shares | 7,881,259 |
Granted, shares (in shares) | shares | 1,135,689 |
Exercised, shares (in shares) | shares | (1,398,901) |
Forfeited/expired, shares (in shares) | shares | (243,593) |
Ending balance, shares (in shares) | shares | 7,374,454 |
Expected to vest, shares (in shares) | shares | 7,171,594 |
Options exercisable, shares (in shares) | shares | 5,057,083 |
Weighted- average exercise price per share | |
Beginning balance, weighted-average exercise price per share (in dollars per share) | $ / shares | $ 62.60 |
Granted, weighted-average exercise price per share (in dollars per share) | $ / shares | 156.07 |
Exercised, weighted-average exercise price per share (in dollars per share) | $ / shares | 41.47 |
Forfeited/expired, weighted-average exercise price per share (in dollars per share) | $ / shares | 107.48 |
Ending balance, weighted-average exercise price per share (in dollars per share) | $ / shares | 79.53 |
Expected to vest, weighted-average exercise price per share (in dollars per share) | $ / shares | 77.71 |
Options exercisable, weighted-average exercise price per share (in dollars per share) | $ / shares | $ 56.86 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | |
Outstanding, weighted-average remaining contractual term (in years), Options outstanding | 5 years 11 months 23 days |
Expected to vest, weighted-average remaining contractual term (in years), Expected to vest | 5 years 10 months 20 days |
Options exercisable, weighted-average remaining contractual term (in years), Options exercisable | 4 years 9 months 25 days |
Options outstanding, aggregate intrinsic value | $ | $ 561,783 |
Expected to vest, aggregate intrinsic value | $ | 558,941 |
Options exercisable, aggregate intrinsic value | $ | $ 496,438 |
Share-based compensation - Stoc
Share-based compensation - Stock Option Activity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unrecognized compensation cost related to unvested share-based compensation | $ 83 | ||
2007 Equity Incentive Plan | Option Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted average grant-date fair values of options granted (in dollars per share) | $ 64.22 | $ 64.66 | $ 30.51 |
Aggregate intrinsic value of options exercised | $ 168.7 | $ 271 | $ 128.4 |
Unrecognized compensation cost related to unvested share-based compensation | $ 64.6 | ||
Unrecognized compensation of weighted-average period, years | 1 year 3 months 18 days |
Share-based compensation - Sc_3
Share-based compensation - Schedule of Non-Vested Restricted Stock Units (Details) - 2007 Equity Incentive Plan - Restricted Stock Units (RSUs) - $ / shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share equivalent | |||
Non-vested beginning balance, share equivalent (in shares) | 2,357,506 | ||
Granted, share equivalent (in shares) | 1,180,665 | ||
Vested, share equivalent (in shares) | (934,049) | ||
Forfeited, share equivalent (in shares) | (245,861) | ||
Non-vested, ending balance, share equivalent (in shares) | 2,358,261 | 2,357,506 | |
Weighted- average grant date fair value | |||
Non-vested, weighted-average grant date fair value (in dollars per share) | $ 105.50 | ||
Granted, weighted-average grant date fair value (in dollars per share) | 157.45 | $ 159.51 | $ 75.58 |
Vested, weighted-average grant date fair value (in dollars per share) | 93.61 | ||
Forfeited, weighted-average grant date fair value (in dollars per share) | 117.01 | ||
Non-vested, weighted-average grant date fair value (in dollars per share) | $ 135.07 | $ 105.50 |
Share-based compensation - RSU
Share-based compensation - RSU Activity - Additional Information (Details) - 2007 Equity Incentive Plan - Restricted Stock Units (RSUs) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Granted, weighted-average grant date fair value (in dollars per share) | $ 157.45 | $ 159.51 | $ 75.58 |
Value of stock awards vested during the period | $ 149.8 | $ 187.1 | $ 67.1 |
Unrecognized compensation cost related to unvested share-based compensation | $ 110.4 | ||
Unrecognized compensation of weighted-average period, years | 1 year 8 months 15 days |
Share-based compensation - Sc_4
Share-based compensation - Schedule of LTIP equity activity (Details) - Restricted Stock Units (RSUs) - Long Term Incentive Plan | 12 Months Ended |
Dec. 31, 2021$ / sharesshares | |
Share equivalent | |
Non-vested beginning balance, share equivalent (in shares) | shares | 678,406 |
Granted, share equivalent (in shares) | shares | 202,293 |
Vested, share equivalent (in shares) | shares | (31) |
Forfeited, share equivalent (in shares) | shares | (77,947) |
Non-vested, ending balance, share equivalent (in shares) | shares | 802,721 |
Weighted- average grant date fair value | |
Non-vested, weighted-average grant date fair value (in dollars per share) | $ / shares | $ 128.96 |
Granted, weighted-average grant date fair value (in dollars per share) | $ / shares | 161.90 |
Vested, weighted-average grant date fair value (in dollars per share) | $ / shares | 136.87 |
Forfeited, weighted-average grant date fair value (in dollars per share) | $ / shares | 127.82 |
Non-vested, weighted-average grant date fair value (in dollars per share) | $ / shares | $ 136.10 |
Share-based compensation - LTIP
Share-based compensation - LTIP Activity - Additional Information (Details) $ in Millions | Dec. 31, 2021USD ($) |
Share-based Payment Arrangement [Abstract] | |
Unrecognized compensation cost related to unvested share-based compensation | $ 83 |
Share-based compensation - Empl
Share-based compensation - Employee Stock Purchase Plan - Additional Information (Details) - shares | 1 Months Ended | 12 Months Ended |
May 31, 2019 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Additional shares reserved for issuance (in shares) | 6,000,000 | |
Employee Stock Purchase Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Discounted stock purchase price, percent of market value | 85.00% | |
Additional shares reserved for issuance (in shares) | 1,000,000 |
Employee benefit plan (Details)
Employee benefit plan (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Retirement Benefits [Abstract] | |||
Total contribution made by employer under matching program | $ 24.8 | $ 18 | $ 11.9 |