Cover Page
Cover Page - shares | 6 Months Ended | |
Jun. 30, 2023 | Jul. 28, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2023 | |
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 | 21823 30th Drive SE | |
Entity Address, City or Town | Bothell | |
Entity Address, State or Province | WA | |
Postal Zip Code | 98021 | |
City Area Code | 425 | |
Local Phone Number | 527-4000 | |
Title of 12(b) Security | Common Stock, par value $0.001 | |
Trading Symbol | SGEN | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 187,697,935 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 | |
Entity Central Index Key | 0001060736 | |
Current Fiscal Year End Date | --12-31 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 308,441 | $ 319,940 |
Short-term investments | 983,678 | 1,415,130 |
Accounts receivable, net | 586,048 | 501,912 |
Inventories | 486,854 | 427,211 |
Prepaid expenses and other current assets | 150,675 | 138,340 |
Total current assets | 2,515,696 | 2,802,533 |
Property and equipment, net | 307,518 | 248,179 |
Operating lease right-of-use assets | 120,628 | 46,738 |
Intangible assets, net | 226,072 | 237,516 |
Goodwill | 274,671 | 274,671 |
Other non-current assets | 50,797 | 64,895 |
Total assets | 3,495,382 | 3,674,532 |
Current liabilities: | ||
Accounts payable | 114,415 | 207,851 |
Accrued liabilities and other | 648,483 | 610,553 |
Total current liabilities | 762,898 | 818,404 |
Long-term liabilities: | ||
Operating lease liabilities, long-term | 97,242 | 43,474 |
Other long-term liabilities | 16,183 | 8,835 |
Total long-term liabilities | 113,425 | 52,309 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Preferred stock, $0.001 par value, 5,000 shares authorized; none issued | 0 | 0 |
Common stock, $0.001 par value, 250,000 shares authorized; 187,672 shares issued and outstanding at June 30, 2023 and 186,559 shares issued and outstanding at December 31, 2022 | 188 | 187 |
Additional paid-in capital | 5,155,375 | 4,954,469 |
Accumulated other comprehensive income | 4,108 | 3,510 |
Accumulated deficit | (2,540,612) | (2,154,347) |
Total stockholders’ equity | 2,619,059 | 2,803,819 |
Total liabilities and stockholders’ equity | $ 3,495,382 | $ 3,674,532 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2023 | Dec. 31, 2022 |
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) | 187,672,000 | 186,559,000 |
Common stock, shares outstanding (in shares) | 187,672,000 | 186,559,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Loss - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Revenues: | ||||
Total revenues | $ 603,832 | $ 497,502 | $ 1,123,551 | $ 923,962 |
Costs and expenses: | ||||
Cost of sales | 180,753 | 106,100 | 292,529 | 193,726 |
Research and development | 399,868 | 304,254 | 755,883 | 601,913 |
Selling, general and administrative | 243,932 | 220,259 | 480,373 | 394,484 |
Total costs and expenses | 824,553 | 630,613 | 1,528,785 | 1,190,123 |
Loss from operations | (220,721) | (133,111) | (405,234) | (266,161) |
Investment and other income (loss), net | 12,084 | (1,609) | 26,484 | (3,799) |
Loss before income taxes | (208,637) | (134,720) | (378,750) | (269,960) |
Provision for income taxes | 2,891 | 107 | 7,515 | 1,361 |
Net loss | $ (211,528) | $ (134,827) | $ (386,265) | $ (271,321) |
Net loss per share - basic (in dollars per share) | $ (1.13) | $ (0.73) | $ (2.06) | $ (1.48) |
Net loss per share - diluted (in dollars per share) | $ (1.13) | $ (0.73) | $ (2.06) | $ (1.48) |
Shares used in computation of per share amounts - basic (in shares) | 187,559 | 184,145 | 187,226 | 183,897 |
Shares used in computation of per share amounts - diluted (in shares) | 187,559 | 184,145 | 187,226 | 183,897 |
Comprehensive loss: | ||||
Net loss | $ (211,528) | $ (134,827) | $ (386,265) | $ (271,321) |
Other comprehensive income (loss): | ||||
Unrealized gain (loss) on securities available-for-sale, net of tax | 172 | (2,736) | 1,542 | (3,597) |
Foreign currency translation gain (loss) | 228 | 2,819 | (944) | 2,925 |
Total other comprehensive income (loss) | 400 | 83 | 598 | (672) |
Comprehensive loss | (211,128) | (134,744) | (385,667) | (271,993) |
Net product sales | ||||
Revenues: | ||||
Total revenues | 543,974 | 431,714 | 1,012,613 | 814,800 |
Royalty revenues | ||||
Revenues: | ||||
Total revenues | 51,189 | 39,109 | 81,367 | 67,290 |
Collaboration and license agreement revenues | ||||
Revenues: | ||||
Total revenues | $ 8,669 | $ 26,679 | $ 29,571 | $ 41,872 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Common stock | Additional paid-in capital | Accumulated other comprehensive income | Accumulated deficit |
Beginning (in shares) at Dec. 31, 2021 | 183,381 | ||||
Beginning at Dec. 31, 2021 | $ 3,065,139 | $ 183 | $ 4,607,816 | $ 1,179 | $ (1,544,039) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | (136,494) | (136,494) | |||
Other comprehensive income (loss) | (755) | (755) | |||
Issuance of common stock for stock option exercises and employee stock purchase plan (in shares) | 463 | ||||
Issuance of common stock for stock option exercises and employee stock purchase plan | 26,664 | $ 1 | 26,663 | ||
Restricted stock vested during the period, net (in shares) | 48 | ||||
Share-based compensation | 43,913 | 43,913 | |||
Ending (in shares) at Mar. 31, 2022 | 183,892 | ||||
Ending at Mar. 31, 2022 | 2,998,467 | $ 184 | 4,678,392 | 424 | (1,680,533) |
Beginning (in shares) at Dec. 31, 2021 | 183,381 | ||||
Beginning at Dec. 31, 2021 | 3,065,139 | $ 183 | 4,607,816 | 1,179 | (1,544,039) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | (271,321) | ||||
Other comprehensive income (loss) | (672) | ||||
Ending (in shares) at Jun. 30, 2022 | 184,369 | ||||
Ending at Jun. 30, 2022 | 2,932,812 | $ 184 | 4,747,481 | 507 | (1,815,360) |
Beginning (in shares) at Mar. 31, 2022 | 183,892 | ||||
Beginning at Mar. 31, 2022 | 2,998,467 | $ 184 | 4,678,392 | 424 | (1,680,533) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | (134,827) | (134,827) | |||
Other comprehensive income (loss) | 83 | 83 | |||
Issuance of common stock for stock option exercises and employee stock purchase plan (in shares) | 298 | ||||
Issuance of common stock for stock option exercises and employee stock purchase plan | 14,960 | 14,960 | |||
Restricted stock vested during the period, net (in shares) | 179 | ||||
Share-based compensation | 54,129 | 54,129 | |||
Ending (in shares) at Jun. 30, 2022 | 184,369 | ||||
Ending at Jun. 30, 2022 | $ 2,932,812 | $ 184 | 4,747,481 | 507 | (1,815,360) |
Beginning (in shares) at Dec. 31, 2022 | 186,559 | 186,559 | |||
Beginning at Dec. 31, 2022 | $ 2,803,819 | $ 187 | 4,954,469 | 3,510 | (2,154,347) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | (174,737) | (174,737) | |||
Other comprehensive income (loss) | 198 | 198 | |||
Issuance of common stock for stock option exercises and employee stock purchase plan (in shares) | 569 | ||||
Issuance of common stock for stock option exercises and employee stock purchase plan | 42,240 | 42,240 | |||
Restricted stock vested during the period, net (in shares) | 223 | ||||
Shares withheld for tax withholding during the period (in shares) | (62) | ||||
Shares withheld for tax withholdings during the period | (12,303) | (12,303) | |||
Share-based compensation | 63,939 | 63,939 | |||
Ending (in shares) at Mar. 31, 2023 | 187,289 | ||||
Ending at Mar. 31, 2023 | $ 2,723,156 | $ 187 | 5,048,345 | 3,708 | (2,329,084) |
Beginning (in shares) at Dec. 31, 2022 | 186,559 | 186,559 | |||
Beginning at Dec. 31, 2022 | $ 2,803,819 | $ 187 | 4,954,469 | 3,510 | (2,154,347) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | (386,265) | ||||
Other comprehensive income (loss) | $ 598 | ||||
Ending (in shares) at Jun. 30, 2023 | 187,672 | 187,672 | |||
Ending at Jun. 30, 2023 | $ 2,619,059 | $ 188 | 5,155,375 | 4,108 | (2,540,612) |
Beginning (in shares) at Mar. 31, 2023 | 187,289 | ||||
Beginning at Mar. 31, 2023 | 2,723,156 | $ 187 | 5,048,345 | 3,708 | (2,329,084) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | (211,528) | (211,528) | |||
Other comprehensive income (loss) | 400 | 400 | |||
Issuance of common stock for stock option exercises and employee stock purchase plan (in shares) | 212 | ||||
Issuance of common stock for stock option exercises and employee stock purchase plan | 13,815 | $ 1 | 13,814 | ||
Restricted stock vested during the period, net (in shares) | 171 | ||||
Share-based compensation | $ 93,216 | 93,216 | |||
Ending (in shares) at Jun. 30, 2023 | 187,672 | 187,672 | |||
Ending at Jun. 30, 2023 | $ 2,619,059 | $ 188 | $ 5,155,375 | $ 4,108 | $ (2,540,612) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Operating activities: | ||
Net loss | $ (386,265) | $ (271,321) |
Adjustments to reconcile net loss to net cash used by operating activities | ||
Share-based compensation | 157,155 | 98,042 |
Depreciation | 24,867 | 22,867 |
Amortization of intangible assets | 11,444 | 11,444 |
Amortization of right-of-use assets | 7,354 | 6,140 |
Amortization of premiums, accretion of discounts, and (gains) losses on debt securities | (23,042) | 484 |
Losses on equity securities | 3,241 | 7,078 |
Deferred income taxes | 549 | (557) |
Inventory write-off | 46,524 | 0 |
Changes in operating assets and liabilities | ||
Accounts receivable, net | (84,136) | (48,785) |
Inventories | (106,167) | (118,691) |
Prepaid expenses and other assets | (10,709) | (37,249) |
Lease liability | (6,951) | (8,533) |
Other liabilities | (58,752) | 50,499 |
Net cash used by operating activities | (424,888) | (288,582) |
Investing activities: | ||
Purchases of securities | (1,125,464) | (1,489,327) |
Proceeds from maturities of securities | 1,581,500 | 1,735,000 |
Payments for lessor-owned assets | (2,727) | (13,756) |
Purchases of property and equipment | (87,885) | (32,161) |
Net cash provided by investing activities | 365,424 | 199,756 |
Financing activities: | ||
Proceeds from exercise of stock options and employee stock purchase plan | 56,055 | 41,624 |
Employee taxes paid related to net share settlement of stock-based awards | (12,303) | 0 |
Net cash provided by financing activities | 43,752 | 41,624 |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | 1,486 | (2,809) |
Net decrease in cash, cash equivalents, and restricted cash | (14,226) | (50,011) |
Cash, cash equivalents, and restricted cash at beginning of period | 323,486 | 424,834 |
Cash, cash equivalents, and restricted cash at end of period | $ 309,260 | $ 374,823 |
Organization and summary of sig
Organization and summary of significant accounting policies | 6 Months Ended |
Jun. 30, 2023 | |
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. Pending Transaction with Pfizer In March 2023, we entered into a definitive merger agreement under which, on the terms and subject to the conditions thereof, Pfizer Inc., or Pfizer, will acquire Seagen Inc., or Seagen, for $229 in cash per Seagen share for a total enterprise value of $43 billion. The companies seek to accelerate the next generation of cancer breakthroughs and bring new solutions to patients by combining the power of Seagen’s ADC technology with the scale and strength of Pfizer’s capabilities and expertise. On May 30, 2023, our shareholders approved a proposal to adopt the definitive merger agreement. However, the closing of the transaction, which we refer to herein as the Pfizer Merger, remains subject to fulfillment of customary closing conditions, including the receipt of required regulatory approvals. In this regard, on June 1, 2023, we and Pfizer referred the Pfizer Merger to the European Commission, or the EC, for review under Article 4(5) of the EU Merger Regulation. On June 23, 2023, the EC accepted jurisdiction as a result of such referral and receipt of approval from the EC for the Pfizer Merger has become a condition for the closing of the Pfizer Merger. Additionally, on July 14, 2023, we and Pfizer each received a request for additional information and documentary materials, or a Second Request, from the Federal Trade Commission, or the FTC, in connection with the FTC’s review of the Pfizer Merger. The effect of a Second Request is to extend the waiting period imposed by the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, or the HSR Act, until 30 days after Seagen and Pfizer each have substantially complied with the Second Request issued to it, unless that period is terminated sooner by the FTC. Completion of the Pfizer Merger remains subject to the expiration or termination of the waiting period under the HSR Act and the satisfaction or waiver of the other closing conditions specified in the Merger Agreement. Basis of presentation The accompanying unaudited condensed consolidated financial statements reflect the accounts of Seagen Inc. and its wholly-owned subsidiaries (collectively “Seagen,” the “Company,” “we,” “our,” or “us”). All intercompany transactions and balances have been eliminated upon consolidation. 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. Substantially all of our assets and revenues are related to operations in the U.S.; however, we have multiple subsidiaries in foreign jurisdictions, including several subsidiaries in Europe. The condensed consolidated balance sheet data as of December 31, 2022 were derived from the audited consolidated financial statements not included in this quarterly report on Form 10-Q. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission, or SEC, and generally accepted accounting principles in the United States of America, or GAAP, for unaudited condensed consolidated financial information. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The accompanying unaudited condensed consolidated financial statements reflect all adjustments consisting of normal recurring adjustments that, in the opinion of management, are necessary for a fair statement of our financial position and results of our operations as of and for the periods presented. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes included in our Annual Report on Form 10-K for the year ended December 31, 2022, as filed with the SEC. The preparation of financial statements in accordance with GAAP requires us to make estimates, assumptions, and judgments that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results could differ from those estimates. The results of our operations for the three and six month periods ended June 30, 2023 are not necessarily indicative of the results to be expected for the full year or any other interim period. Non-cash activities We had $29.5 million and $20.1 million of accrued capital expenditures as of June 30, 2023 and December 31, 2022, respectively. Accrued capital expenditures are treated as a non-cash investing activity and, accordingly, have not been included in the condensed consolidated statement of cash flows until such amounts have been paid in cash. We recorded $81.2 million and $0.2 million right-of-use assets during the six months ended June 30, 2023 and 2022, respectively, and lease liabilities of $58.7 million and $0.1 million during the six months ended June 30, 2023 and 2022, respectively. Investments We hold certain equity securities which are reported at estimated fai r value based on quoted market prices. Cha nges 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 (loss), 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 (loss), net. Interest and dividends earned are included in investment and other income (loss), net . Accrued interest receivable as of June 30, 2023 and December 31, 2022 , were $0.1 million and $5.2 million, respectively, and were included in prepaid expenses and other current assets. We c lassify 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 (loss), net. Restricted Cash As of June 30, 2023 , we had $0.8 million cash held in escrow restricted by a contractual agreement related to our Everett, Washington building construction project. The restricted cash was recorded in prepaid expenses and other current assets in the condensed consolidated balance sheet. We determine classification based on the expected duration of the restriction. Our total cash, cash equivalents, and restricted cash, as presented in the condensed consolidated statements of cash flows, was as follows: (dollars in thousands) June 30, 2023 December 31, 2022 Cash and cash equivalents $ 308,441 $ 319,940 Restricted cash included in prepaid expenses and other current assets 819 3,546 Total cash, cash equivalents, and restricted cash as presented in the condensed consolidated statements of cash flows $ 309,260 $ 323,486 Intangible assets, net Our intangible assets are primarily comprised of acquired TUKYSA technology. The following table presents the balances of our finite-lived intangible assets for the periods presented: (dollars in thousands) June 30, 2023 December 31, 2022 Gross carrying value $ 305,650 $ 305,650 Less: accumulated amortization (79,578) (68,134) Total $ 226,072 $ 237,516 The following table presents our amortization expense related to acquired TUKYSA technology costs, included in cost of sales in our condensed consolidated statements of comprehensive loss, for the periods presented: Three Months Ended June 30, Six Months Ended June 30, (dollars in thousands) 2023 2022 2023 2022 Amortization expense $ 5,753 $ 5,753 $ 11,444 $ 11,444 The weighted average remaining useful life of our finite-lived intangible assets was approximately 10 years as of June 30, 2023, and estimated future amortization expense related to acquired TUKYSA is $11.6 million for the six months ending December 31, 2023, and TUKYSA technology costs is $23.1 million for each of the years ending December 31, 2024 through December 31, 2028. Revenue recognition - Net product sales We sell our products primarily through a limited number of specialty distributors and specialty pharmaci es 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, eligible customers receive an applicable discount which is processed through the distributor as 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 our patient assistance program, 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 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. Recent Accounting Pronouncements We reviewed recently issued accounting pronouncements and concluded that they were either not applicable or not expected to have a material impact on our condensed consolidated financial statements. |
Revenue from contracts with cus
Revenue from contracts with customers | 6 Months Ended |
Jun. 30, 2023 | |
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 periods presented. Three Months Ended June 30, Six Months Ended June 30, (dollars in thousands) 2023 2022 2023 2022 ADCETRIS $ 261,853 $ 201,939 $ 504,915 $ 382,928 PADCEV 161,230 123,577 279,936 223,784 TUKYSA 99,204 88,989 186,580 179,464 TIVDAK 21,687 17,209 41,182 28,624 Net product sales $ 543,974 $ 431,714 $ 1,012,613 $ 814,800 Royalty revenues $ 51,189 $ 39,109 $ 81,367 $ 67,290 Collaboration and license agreement revenues $ 8,669 $ 26,679 $ 29,571 $ 41,872 Total revenues $ 603,832 $ 497,502 $ 1,123,551 $ 923,962 |
Leases
Leases | 6 Months Ended |
Jun. 30, 2023 | |
Leases [Abstract] | |
Leases | Leases We have operating leases for our office and laboratory facilities with terms that expire from 2023 through 2042 . We recorded $81.2 million and $0.2 million right-of-use assets during the six months ended June 30, 2023 and 2022, respectively, and lease liabilities of $58.7 million and $0.1 million during the six months ended June 30, 2023 and 2022, respectively. All of our significan t 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 June 30, 2023. In June 2021, we entered into a lease agreement for an approximately 258,000 square foot 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 commenced in January 2023 when construction and delivery of the building shell and related improvements by the landlord were substantially completed, and we recorded a lease liability and right-of-use assets on our condensed consolidated balance sheet. 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: Three Months Ended June 30, Six Months Ended June 30, (dollars in thousands) 2023 2022 2023 2022 Operating lease cost $ 5,480 $ 3,947 $ 10,912 $ 8,142 Variable lease cost 1,429 1,249 2,563 2,321 Total lease cost $ 6,909 $ 5,196 $ 13,475 $ 10,463 Cash paid for amounts included in measurement of lease liabilities $ 4,654 $ 4,196 $ 8,908 $ 8,749 As of June 30, 2023 2022 Weighted average remaining lease term 11.9 years 5.6 years Weighted average discount rate 6.7 % 5.0 % Operating lease liabilities were recorded in the following captions of our condensed consolidated balance sheets as follows: (dollars in thousands) June 30, 2023 December 31, 2022 Accrued liabilities and other $ 14,133 $ 14,517 Operating lease liabilities, long-term 97,242 43,474 Total $ 111,375 $ 57,991 |
Net loss per share
Net loss per share | 6 Months Ended |
Jun. 30, 2023 | |
Earnings Per Share [Abstract] | |
Net loss per share | Net loss per share Basic net loss per share is computed by dividing net loss by the weighted average number of common shares outstanding during the period. Diluted net loss per share is computed by dividing net loss by the weighted average number of common shares and dilutive potential 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. We excluded the potential shares of common stock from the computation of diluted net 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: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2023 2022 2023 2022 Stock options and RSUs 8,800 9,824 8,547 10,077 |
Fair value
Fair value | 6 Months Ended |
Jun. 30, 2023 | |
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 June 30, 2023 Short-term investments—U.S. Treasury securities $ 983,678 $ — $ — $ 983,678 Other non-current assets—equity securities 613 — — 613 Total $ 984,291 $ — $ — $ 984,291 December 31, 2022 Short-term investments—U.S. Treasury securities $ 1,415,130 $ — $ — $ 1,415,130 Other non-current assets—equity securities 3,854 — — 3,854 Total $ 1,418,984 $ — $ — $ 1,418,984 Our short-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 three and six months ended June 30, 2023 and 2022, 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 June 30, 2023 or December 31, 2022. Our debt securities consisted of the following: (dollars in thousands) Amortized Gross Gross Fair June 30, 2023 U.S. Treasury securities $ 983,723 $ 97 $ (142) $ 983,678 Contractual maturities (at date of purchase): Due in one year or less $ 983,723 $ 983,678 December 31, 2022 U.S. Treasury securities $ 1,416,717 $ 96 $ (1,683) $ 1,415,130 Contractual maturities (at date of purchase): Due in one year or less $ 1,400,852 $ 1,399,382 Due in one to two years 15,865 15,748 Total $ 1,416,717 $ 1,415,130 |
Investment and other income (lo
Investment and other income (loss), net | 6 Months Ended |
Jun. 30, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Investment and other income (loss), net | Investment and other income (loss), net Investment and other income (loss), net consisted of the following: Three Months Ended June 30, Six Months Ended June 30, (dollars in thousands) 2023 2022 2023 2022 Loss on equity securities $ (3,004) $ (4,299) $ (3,241) $ (7,078) Investment and other income, net 15,088 2,690 29,725 3,279 Total investment and other income (loss), net $ 12,084 $ (1,609) $ 26,484 $ (3,799) Loss on equity securities includes the realized and unrealized holding gains and losses on our equity securities. At times, we hold equity investments in certain companies acquired in relation to a strategic partnership. Shares held at the end of reporting periods are marked to market in our condensed consolidated financial statements, which can result in unrealized gains and losses. |
Inventories
Inventories | 6 Months Ended |
Jun. 30, 2023 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consisted of the following: (dollars in thousands) June 30, 2023 December 31, 2022 Raw materials $ 11,940 $ 14,916 Work in process 427,776 357,275 Finished goods 47,138 55,020 Total $ 486,854 $ 427,211 We capitalize our commercial inventory costs. Work in process represents inventory at various stages of the production process, which includes costs for materials, labor, and overhead applied during the production process. 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. During the second quarter of 2023, we recorded a $47 million inventory write-off related to in-process production of one of our products that did not meet a release specification that was updated in June 2023. |
Accrued liabilities
Accrued liabilities | 6 Months Ended |
Jun. 30, 2023 | |
Payables and Accruals [Abstract] | |
Accrued liabilities | Accrued liabilities Accrued liabilities consisted of the following: (dollars in thousands) June 30, 2023 December 31, 2022 Clinical trial and related costs $ 206,415 $ 194,006 Employee compensation and benefits 157,027 175,506 Gross-to-net deductions and third-party royalties 138,155 119,289 Acquisition related expenses 25,678 — Contract manufacturing 29,934 21,638 Other 91,274 100,114 Total $ 648,483 $ 610,553 We have incurred approximately $36 million of acquisition related expenses in connection with the pending merger with Pfizer for the six months ended June 30, 2023, with $26 million remaining in accrued liabilities . |
Share-based compensation
Share-based compensation | 6 Months Ended |
Jun. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Share-based compensation | Share-based compensation The following table presents our total share-based compensation expense for the periods presented: Three Months Ended June 30, Six Months Ended June 30, (dollars in thousands) 2023 2022 2023 2022 Research and development $ 49,845 $ 23,446 $ 79,912 $ 46,522 Selling, general and administrative 43,371 30,683 77,243 51,520 Total share-based compensation expense $ 93,216 $ 54,129 $ 157,155 $ 98,042 During the second quarter of 2023, we granted retention awards of approximately $280 million in the form of cash and RSUs to incentivize certain employees to remain employed at the company during the pendency of the Pfizer Merger and following the closing of the transaction. The awards consist of 20% in the form of cash that vests on the 9-month anniversary of the grant, 30% in the form of RSUs that vest on the 18-month anniversary of the grant, 25% in the form of RSUs that vest on the 24-month anniversary of the grant, and 25% in the form of RSUs that vest on the 30-month anniversary of the grant. As of June 30, 2023 , there was $371.4 million of unrecognized compensation cost related to unvested options including options subject to market-based performance metrics, and restricted stock unit awards, excluding our performance-based RSUs, net of forfeitures. T he estimated unrecognized compensation expense related to our performance-based RSUs was approximately $62 million as of June 30, 2023 . |
Income taxes
Income taxes | 6 Months Ended |
Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Income taxes For the three and six months ended June 30, 2023, we had taxable profits in the U.S. as a result of amendments to IRC Section 174, which took effect January 1, 2022 pursuant to the 2017 Tax Cuts and Jobs Act. We recorded an income tax provision for the three and six months ended June 30, 2023 of $2.9 million and $7.5 million, respectively, primarily related to estimated state tax liabilities for which there were limitations on the use of existing state tax carryforwards. We had existing federal tax carryforwards sufficient to offset most of the federal liability. Our income tax provision also reflected taxable profits in foreign jurisdictions. Our effective tax rate for the three and six months ended June 30, 2023 of approximately 1.4% and 2.0%, respectively, differed from the federal statutory rate primarily because of changes in the valuation allowance against substantially all of our deferred tax assets. For the three and six months ended June 30, 2022, we had taxable profits in the U.S. as a result of amendments to IRC Section 174, which took effect January 1, 2022 pursuant to the 2017 Tax Cuts and Jobs Act. We recorded an income tax provision of $0.1 million and $1.4 million, respectively, primarily related to estimated state tax liabilities for which there were limitations on the use of existing state tax carryforwards. We had existing federal tax carryforwards sufficient to offset any federal liability. Our income tax provision also reflected taxable profits in foreign jurisdictions. For the three and six months ended June 30, 2022, our effective tax rate of approximately 0.1% and 0.5%, respectively, differed from the federal statutory rate primarily because we have provided a valuation allowance against substantially all our deferred tax assets. |
Legal matters
Legal matters | 6 Months Ended |
Jun. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Legal matters | Legal matters From time to time, we are involved in legal matters, including the disputes below. As a result of these disputes, we have incurred and will continue to incur litigation expenses. Dispute over ownership of intellectual property We have been in a dispute with Daiichi Sankyo Co. Ltd., or Daiichi Sankyo, regarding the ownership of certain technology used by Daiichi Sankyo in its cancer drug Enhertu® (fam-trastuzumab deruxtecan-nxki) 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 contended, was assigned to us under the terms of a 2008 collaboration agreement between us and Daiichi Sankyo, or the Daiichi Sankyo Collaboration Agreement. 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. 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 royal ty. On April 27, 2020, the arbitrator confirmed the dispute should be resolved in arbitration. The arbitration hearing was conducted in June 2021 and April 2022. O n August 12, 2022, the arbitrator ruled in favor of Daiichi Sankyo, citing statute of limitations and disagreement with us on the interpretation of the contract. On November 10, 2022, we filed a motion to vacate the arbitration award in the U.S. District Court for the Western District of Washington, and that action has been stayed pending a final award in the arbitration. The Daiichi Sankyo Collaboration Agreement provides that judgment rendered by an arbitrator shall include costs of arbitration, reasonable attorneys’ fees and reasonable costs for expert and other witnesses. On September 14, 2022, Daiichi Sankyo submitted a petition for approximately $58 million for reimbursement of its legal fees and costs associated with the arbitration. We filed oppositions to Daiichi Sankyo’s request on October 12, 2022 and May 23, 2023. While we oppose any fees being awarded to Daiichi Sankyo, a liability between approximately $14 million and $58 million is reasonably estimable. An estimate of our liability for these fees towards the low end of the range has been recorded in accrued liabilities in our condensed consolidated financial statements. It is reasonably possible the arbitrator will render an award pursuant to Daiichi Sankyo’s request that is different from what we have accrued or estimated and that we will need to adjust our estimate in future periods pursuant to the arbitrator’s award. 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. The remedies sought in this action include, 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 and Trademark Office, or USPTO, seeking to have claims of the ’039 Patent cancelled as unpatentable. On June 24, 2021, the USPTO issued a decision denying both petitions for post-grant review. On April 7, 2022, the USPTO granted a request on rehearing and instituted two post-grant review proceedings, but on July 15, 2022, the USPTO issued a new decision denying post-grant review of the claims asserted in the patent infringement action. On February 7, 2023, in response to Daiichi Sankyo and AstraZeneca’s second request for rehearing of the denial of the post-grant review to the USPTO and for Precedential Opinion Panel, or POP, review, the Precedential Opinion Panel issued an order denying the request for POP review but directing the USPTO panel evaluating the second rehearing request to make an explicit finding using its own discretion as to whether the post-grant review petition presents a “compelling” showing of invalidity as part of its ruling on the pending second rehearing request. The panel was also directed to rule on the second rehearing request within two weeks from the POP order. On February 14, 2023, the panel decided to institute the post-grant review of the claims of the ’039 Patent asserted in the patent infringement action. On April 8, 2022, a jury in the United States District Court for the Eastern District of Texas found that Daiichi Sankyo willfully infringed the asserted claims of the ’039 Patent with its Enhertu product, and also found that the asserted claims were not invalid. The jury further awarded damages of $41.8 million for infringement from October 20, 2020 through March 31, 2022. The U.S. District Court for the Eastern District of Texas also denied Daiichi Sankyo’s claim that the ’039 Patent should be unenforceable under the equitable theory of prosecution laches, entered judgment in favor of us based on the jury’s verdict that Daiichi Sankyo willfully infringed the ’039 Patent consisting of pre-trial damages in the sum of $41.8 million, and awarded us pre- and post-trial interest and costs. We have requested a royalty in the range of 10-12% on Daiichi Sankyo’s future sales of Enhertu in the United States through November 5, 2024, the current expiration date of the ’039 Patent, as well as $12 million for reimbursement of our reasonable attorneys’ fees. Pursuant to ASC 450, awards of this nature must be either realized or realizable to be reflected in the company’s financial statements. No amounts related to these patent infringement matters have been reflected in our condensed consolidated financial statements as of June 30, 2023. PADCEV product liability litigation On March 14, 2023, a purported class action was filed in the United States District Court for the Central District of California against us, Astellas and Agensys, Inc., alleging that the defendants failed to warn of side effects to the skin that can occur when taking PADCEV. The complaint alleges claims under strict liability, negligence and fraud, and seeks damages, including punitive damages, interest, attorneys’ fees and costs. We intend to vigorously defend against these claims. No amounts related to these matters have been reflected in our condensed consolidated financial statements as of June 30, 2023. Litigation related to the Pfizer Merger Six lawsuits were filed by purported Seagen stockholders in connection with the Pfizer Merger. The complaints alleged, among other things, that certain disclosures in the preliminary proxy statement we filed on April 14, 2023 or definitive proxy statement we filed on April 24, 2023 in connection with the Pfizer Merger were materially incomplete and misleading. Four actions, captioned O’Dell v. Seagen Inc., et al. , No. 1:23-cv-03254 (Apr. 19, 2023), Boyd v. Seagen Inc., et al. , No. 1:23-cv-03309 (Apr. 20, 2023), Wang v. Seagen Inc., et al. , No. 1:23-cv-03302 (Apr. 20, 2023), and Ober v. Seagen Inc., et al. , No. 1:23-cv-03378 (Apr. 21, 2023), were filed in the United States District Court for the Southern District of New York; one action, captioned McDaniel v. Seagen, Inc. et al. , No. 1:23-cv-00504 (May 8, 2023), was filed in the United States District Court for the District of Delaware; and one action, captioned Nicosia v. Baker et al. , No. 23-2-03250-31 (May 2, 2023), was filed in the Superior Court of the State of Washington for the County of Snohomish. The six complaints included the Company and the current members of our board of directors as defendants, and the plaintiffs alleged, among other things, violations of Sections 14(a) and 20(a) of the Exchange Act, 15 U.S.C. §§ 78n(a), 78t(a), SEC Rule 14a-9, 17 C.F.R. 240.14a-9 and 17 C.F.R. § 244.100 and, in the case of the Washington State complaint, also included Pfizer as a defendant and alleged violations of Washington State securities laws. The complaints sought, among other relief, to enjoin us from consummating the Pfizer Merger and to be awarded rescissory damages, including reasonable attorneys’ and expert fees and expenses. We believe that the allegations asserted in the complaints were without merit. All of the actions were voluntarily dismissed following the publication of additional disclosures by the Company. No amounts related to these matters have been reflected in our condensed consolidated financial statements as of June 30, 2023. We are not aware of the filing of other lawsuits challenging the Pfizer Merger or the proxy statement; however, additional lawsuits arising out of the Pfizer Merger or the related proxy statement may be filed in the future. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Pay vs Performance Disclosure | ||||||
Net loss | $ (211,528) | $ (174,737) | $ (134,827) | $ (136,494) | $ (386,265) | $ (271,321) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended | 6 Months Ended |
Jun. 30, 2023 shares | Jun. 30, 2023 shares | |
Trading Arrangements, by Individual | ||
Rule 10b5-1 Arrangement Adopted | false | |
Non-Rule 10b5-1 Arrangement Adopted | false | |
Non-Rule 10b5-1 Arrangement Terminated | false | |
Roger D. Dansey, M.D. [Member] | ||
Trading Arrangements, by Individual | ||
Material Terms of Trading Arrangement | On May 3, 2023, Roger D. Dansey, M.D. President, Research and Development and Chief Medical Officer, terminated a trading arrangement that was intended to satisfy the affirmative defense of Rule 10b5-1(c), or the Dansey 10b5-1 Plan. The Dansey 10b5-1 Plan was entered into on September 9, 2022, with a termination date of the earlier of October 13, 2023 or the date all shares under the plan were sold. The aggregate number of securities to be sold pursuant to the Dansey 10b5-1 Plan was 88,083. | |
Name | Roger D. Dansey, M.D | |
Title | President, Research and Development and Chief Medical Officer | |
Adoption Date | September 9, 2022 | |
Rule 10b5-1 Arrangement Terminated | true | |
Termination Date | May 3, 2023 | |
Aggregate Available | 88,083 | 88,083 |
Jean I. Liu [Member] | ||
Trading Arrangements, by Individual | ||
Material Terms of Trading Arrangement | On May 15, 2023, Jean I. Liu, Chief Legal Officer, terminated a trading arrangement that was intended to satisfy the affirmative defense of Rule 10b5-1(c), or the Liu 10b5-1 Plan. The Liu 10b5-1 Plan was entered into on November 25, 2022, with a termination date of the earlier of December 29, 2023 or the date all shares under the plan were sold. The aggregate number of securities to be sold pursuant to the Liu 10b5-1 Plan was 67,739. | |
Name | Jean I. Liu | |
Title | Chief Legal Officer | |
Adoption Date | November 25, 2022 | |
Rule 10b5-1 Arrangement Terminated | true | |
Termination Date | May 15, 2023 | |
Aggregate Available | 67,739 | 67,739 |
Organization and summary of s_2
Organization and summary of significant accounting policies (Policies) | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation The accompanying unaudited condensed consolidated financial statements reflect the accounts of Seagen Inc. and its wholly-owned subsidiaries (collectively “Seagen,” the “Company,” “we,” “our,” or “us”). All intercompany transactions and balances have been eliminated upon consolidation. 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. Substantially all of our assets and revenues are related to operations in the U.S.; however, we have multiple subsidiaries in foreign jurisdictions, including several subsidiaries in Europe. The condensed consolidated balance sheet data as of December 31, 2022 were derived from the audited consolidated financial statements not included in this quarterly report on Form 10-Q. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission, or SEC, and generally accepted accounting principles in the United States of America, or GAAP, for unaudited condensed consolidated financial information. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The accompanying unaudited condensed consolidated financial statements reflect all adjustments consisting of normal recurring adjustments that, in the opinion of management, are necessary for a fair statement of our financial position and results of our operations as of and for the periods presented. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes included in our Annual Report on Form 10-K for the year ended December 31, 2022, as filed with the SEC. The preparation of financial statements in accordance with GAAP requires us to make estimates, assumptions, and judgments that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results could differ from those estimates. The results of our operations for the three and six month periods ended June 30, 2023 are not necessarily indicative of the results to be expected for the full year or any other interim period. |
Non-cash activities | Non-cash activities We had $29.5 million and $20.1 million of accrued capital expenditures as of June 30, 2023 and December 31, 2022, respectively. Accrued capital expenditures are treated as a non-cash investing activity and, accordingly, have not been included in the condensed consolidated statement of cash flows until such amounts have been paid in cash. We recorded $81.2 million and $0.2 million right-of-use assets during the six months ended June 30, 2023 and 2022, respectively, and lease liabilities of $58.7 million and $0.1 million during the six months ended June 30, 2023 and 2022, respectively. |
Investments | Investments We hold certain equity securities which are reported at estimated fai r value based on quoted market prices. Cha nges 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 (loss), 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 (loss), net. Interest and dividends earned are included in investment and other income (loss), net . Accrued interest receivable as of June 30, 2023 and December 31, 2022 , were $0.1 million and $5.2 million, respectively, and were included in prepaid expenses and other current assets. We c lassify 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 (loss), net. |
Restricted Cash | Restricted Cash As of June 30, 2023 , we had $0.8 million cash held in escrow restricted by a contractual agreement related to our Everett, Washington building construction project. The restricted cash was recorded in prepaid expenses and other current assets in the condensed consolidated balance sheet. We determine classification based on the expected duration of the restriction. |
Intangible assets, net | Intangible assets, netOur intangible assets are primarily comprised of acquired TUKYSA technology. |
Revenue recognition | Revenue recognition - Net product sales We sell our products primarily through a limited number of specialty distributors and specialty pharmaci es 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, eligible customers receive an applicable discount which is processed through the distributor as 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 our patient assistance program, 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 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. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements We reviewed recently issued accounting pronouncements and concluded that they were either not applicable or not expected to have a material impact on our condensed consolidated financial statements. |
Organization and summary of s_3
Organization and summary of significant accounting policies (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Schedule of Cash, Cash Equivalents | Our total cash, cash equivalents, and restricted cash, as presented in the condensed consolidated statements of cash flows, was as follows: (dollars in thousands) June 30, 2023 December 31, 2022 Cash and cash equivalents $ 308,441 $ 319,940 Restricted cash included in prepaid expenses and other current assets 819 3,546 Total cash, cash equivalents, and restricted cash as presented in the condensed consolidated statements of cash flows $ 309,260 $ 323,486 |
Schedule of Cash, Cash Equivalents, and Restricted Cash | Our total cash, cash equivalents, and restricted cash, as presented in the condensed consolidated statements of cash flows, was as follows: (dollars in thousands) June 30, 2023 December 31, 2022 Cash and cash equivalents $ 308,441 $ 319,940 Restricted cash included in prepaid expenses and other current assets 819 3,546 Total cash, cash equivalents, and restricted cash as presented in the condensed consolidated statements of cash flows $ 309,260 $ 323,486 |
Schedule of Finite-Lived Intangible Assets | The following table presents the balances of our finite-lived intangible assets for the periods presented: (dollars in thousands) June 30, 2023 December 31, 2022 Gross carrying value $ 305,650 $ 305,650 Less: accumulated amortization (79,578) (68,134) Total $ 226,072 $ 237,516 |
Schedule of Amortization Expense | The following table presents our amortization expense related to acquired TUKYSA technology costs, included in cost of sales in our condensed consolidated statements of comprehensive loss, for the periods presented: Three Months Ended June 30, Six Months Ended June 30, (dollars in thousands) 2023 2022 2023 2022 Amortization expense $ 5,753 $ 5,753 $ 11,444 $ 11,444 |
Revenue from contracts with c_2
Revenue from contracts with customers (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Collaboration and License Agreement Revenues by Collaborator | The following table presents our disaggregated revenue for the periods presented. Three Months Ended June 30, Six Months Ended June 30, (dollars in thousands) 2023 2022 2023 2022 ADCETRIS $ 261,853 $ 201,939 $ 504,915 $ 382,928 PADCEV 161,230 123,577 279,936 223,784 TUKYSA 99,204 88,989 186,580 179,464 TIVDAK 21,687 17,209 41,182 28,624 Net product sales $ 543,974 $ 431,714 $ 1,012,613 $ 814,800 Royalty revenues $ 51,189 $ 39,109 $ 81,367 $ 67,290 Collaboration and license agreement revenues $ 8,669 $ 26,679 $ 29,571 $ 41,872 Total revenues $ 603,832 $ 497,502 $ 1,123,551 $ 923,962 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Leases [Abstract] | |
Schedule of Supplemental Operating Lease Information | Supplemental operating lease information was as follows: Three Months Ended June 30, Six Months Ended June 30, (dollars in thousands) 2023 2022 2023 2022 Operating lease cost $ 5,480 $ 3,947 $ 10,912 $ 8,142 Variable lease cost 1,429 1,249 2,563 2,321 Total lease cost $ 6,909 $ 5,196 $ 13,475 $ 10,463 Cash paid for amounts included in measurement of lease liabilities $ 4,654 $ 4,196 $ 8,908 $ 8,749 As of June 30, 2023 2022 Weighted average remaining lease term 11.9 years 5.6 years Weighted average discount rate 6.7 % 5.0 % |
Schedule of Operating Lease Assets and Liabilities | Operating lease liabilities were recorded in the following captions of our condensed consolidated balance sheets as follows: (dollars in thousands) June 30, 2023 December 31, 2022 Accrued liabilities and other $ 14,133 $ 14,517 Operating lease liabilities, long-term 97,242 43,474 Total $ 111,375 $ 57,991 |
Net loss per share (Tables)
Net loss per share (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Weighted Average Number of Shares | The following table presents the weighted average number of shares that have been excluded for all periods presented: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2023 2022 2023 2022 Stock options and RSUs 8,800 9,824 8,547 10,077 |
Fair value (Tables)
Fair value (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule 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 June 30, 2023 Short-term investments—U.S. Treasury securities $ 983,678 $ — $ — $ 983,678 Other non-current assets—equity securities 613 — — 613 Total $ 984,291 $ — $ — $ 984,291 December 31, 2022 Short-term investments—U.S. Treasury securities $ 1,415,130 $ — $ — $ 1,415,130 Other non-current assets—equity securities 3,854 — — 3,854 Total $ 1,418,984 $ — $ — $ 1,418,984 |
Schedule of Debt Securities | Our debt securities consisted of the following: (dollars in thousands) Amortized Gross Gross Fair June 30, 2023 U.S. Treasury securities $ 983,723 $ 97 $ (142) $ 983,678 Contractual maturities (at date of purchase): Due in one year or less $ 983,723 $ 983,678 December 31, 2022 U.S. Treasury securities $ 1,416,717 $ 96 $ (1,683) $ 1,415,130 Contractual maturities (at date of purchase): Due in one year or less $ 1,400,852 $ 1,399,382 Due in one to two years 15,865 15,748 Total $ 1,416,717 $ 1,415,130 |
Investment and other income (_2
Investment and other income (loss), net (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Investment and Other Income (Loss), Net | Investment and other income (loss), net consisted of the following: Three Months Ended June 30, Six Months Ended June 30, (dollars in thousands) 2023 2022 2023 2022 Loss on equity securities $ (3,004) $ (4,299) $ (3,241) $ (7,078) Investment and other income, net 15,088 2,690 29,725 3,279 Total investment and other income (loss), net $ 12,084 $ (1,609) $ 26,484 $ (3,799) |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories consisted of the following: (dollars in thousands) June 30, 2023 December 31, 2022 Raw materials $ 11,940 $ 14,916 Work in process 427,776 357,275 Finished goods 47,138 55,020 Total $ 486,854 $ 427,211 |
Accrued liabilities (Tables)
Accrued liabilities (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Liabilities | Accrued liabilities consisted of the following: (dollars in thousands) June 30, 2023 December 31, 2022 Clinical trial and related costs $ 206,415 $ 194,006 Employee compensation and benefits 157,027 175,506 Gross-to-net deductions and third-party royalties 138,155 119,289 Acquisition related expenses 25,678 — Contract manufacturing 29,934 21,638 Other 91,274 100,114 Total $ 648,483 $ 610,553 |
Share-based compensation (Table
Share-based compensation (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Share-based Compensation | The following table presents our total share-based compensation expense for the periods presented: Three Months Ended June 30, Six Months Ended June 30, (dollars in thousands) 2023 2022 2023 2022 Research and development $ 49,845 $ 23,446 $ 79,912 $ 46,522 Selling, general and administrative 43,371 30,683 77,243 51,520 Total share-based compensation expense $ 93,216 $ 54,129 $ 157,155 $ 98,042 |
Organization and summary of s_4
Organization and summary of significant accounting policies - Additional Information (Details) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2023 USD ($) segment | Dec. 31, 2022 USD ($) | Mar. 31, 2023 USD ($) $ / shares | Jun. 30, 2022 USD ($) | |
Summary Of Significant Accounting Policies [Line Items] | ||||
Number of reporting segments | segment | 1 | |||
Accrued capital expenditures | $ 29,500 | $ 20,100 | ||
Operating lease right-of-use assets | 120,628 | 46,738 | ||
Operating lease liabilities | 111,375 | 57,991 | ||
Accrued interest receivable | 100 | 5,200 | ||
Cash held in escrow restricted by a contractual agreement | 819 | $ 3,546 | ||
Estimated future amortization expense, remainder of fiscal year | 11,600 | |||
Estimated future amortization expense, 2024 | 23,100 | |||
Estimated future amortization expense, 2025 | 23,100 | |||
Estimated future amortization expense, 2026 | 23,100 | |||
Estimated future amortization expense, 2027 | 23,100 | |||
Estimated future amortization expense, 2028 | $ 23,100 | |||
Weighted Average | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Intangible asset useful life | 10 years | |||
Office and Laboratory Facilities | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Operating lease right-of-use assets | $ 81,200 | $ 200 | ||
Operating lease liabilities | $ 58,700 | $ 100 | ||
Pfizer Merger | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Share price (in dollars per share) | $ / shares | $ 229 | |||
Enterprise value | $ 43,000,000 |
Organization and summary of s_5
Organization and summary of significant accounting policies - Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 | Jun. 30, 2022 | Dec. 31, 2021 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 308,441 | $ 319,940 | ||
Restricted cash included in prepaid expenses and other current assets | 819 | 3,546 | ||
Total cash, cash equivalents, and restricted cash as presented in the condensed consolidated statements of cash flows | $ 309,260 | $ 323,486 | $ 374,823 | $ 424,834 |
Organization and summary of s_6
Organization and summary of significant accounting policies - Finite-lived intangible Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Accounting Policies [Abstract] | ||
Gross carrying value | $ 305,650 | $ 305,650 |
Less: accumulated amortization | (79,578) | (68,134) |
Total | $ 226,072 | $ 237,516 |
Organization and summary of s_7
Organization and summary of significant accounting policies - Amortization Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Accounting Policies [Abstract] | ||||
Amortization expense | $ 5,753 | $ 5,753 | $ 11,444 | $ 11,444 |
Revenue from contracts with c_3
Revenue from contracts with customers (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Disaggregation of Revenue [Line Items] | ||||
Total revenues | $ 603,832 | $ 497,502 | $ 1,123,551 | $ 923,962 |
Net product sales | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 543,974 | 431,714 | 1,012,613 | 814,800 |
Net product sales | ADCETRIS | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 261,853 | 201,939 | 504,915 | 382,928 |
Net product sales | PADCEV | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 161,230 | 123,577 | 279,936 | 223,784 |
Net product sales | TUKYSA | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 99,204 | 88,989 | 186,580 | 179,464 |
Net product sales | TIVDAK | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 21,687 | 17,209 | 41,182 | 28,624 |
Royalty revenues | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 51,189 | 39,109 | 81,367 | 67,290 |
Collaboration and license agreement revenues | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | $ 8,669 | $ 26,679 | $ 29,571 | $ 41,872 |
Leases - Additional Information
Leases - Additional Information (Details) ft² in Thousands, $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2021 USD ($) a ft² term | Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Lessee, Lease, Description [Line Items] | ||||||
Operating lease right-of-use assets | $ 120,628 | $ 120,628 | $ 46,738 | |||
Operating lease liabilities | 111,375 | 111,375 | $ 57,991 | |||
Lease agreement, rented area | ft² | 258 | |||||
Rentable building and complex constructed (in acres) | a | 20.5 | |||||
Cash paid for amounts included in measurement of lease liabilities | $ 4,000 | 4,654 | $ 4,196 | 8,908 | $ 8,749 | |
Annual escalations | 3% | |||||
Initial term | 20 years | |||||
Option to extend | term | 2 | |||||
Renewal term | 10 years | |||||
Office and Laboratory Facilities | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Operating lease right-of-use assets | 81,200 | 200 | 81,200 | 200 | ||
Operating lease liabilities | $ 58,700 | $ 100 | $ 58,700 | $ 100 |
Leases - Lease Cost (Details)
Leases - Lease Cost (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Leases [Abstract] | |||||
Operating lease cost | $ 5,480 | $ 3,947 | $ 10,912 | $ 8,142 | |
Variable lease cost | 1,429 | 1,249 | 2,563 | 2,321 | |
Total lease cost | 6,909 | 5,196 | 13,475 | 10,463 | |
Cash paid for amounts included in measurement of lease liabilities | $ 4,000 | $ 4,654 | $ 4,196 | $ 8,908 | $ 8,749 |
Weighted average remaining lease term | 11 years 10 months 24 days | 5 years 7 months 6 days | 11 years 10 months 24 days | 5 years 7 months 6 days | |
Weighted average discount rate | 6.70% | 5% | 6.70% | 5% |
Leases - Schedule of Balance Sh
Leases - Schedule of Balance Sheet Information (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Leases [Abstract] | ||
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Accrued liabilities and other | Accrued liabilities and other |
Accrued liabilities and other | $ 14,133 | $ 14,517 |
Operating lease liabilities, long-term | 97,242 | 43,474 |
Total | $ 111,375 | $ 57,991 |
Net loss per share (Details)
Net loss per share (Details) - shares shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Earnings Per Share [Abstract] | ||||
Stock options and RSUs (in shares) | 8,800 | 9,824 | 8,547 | 10,077 |
Fair value - Schedule of Fair V
Fair value - Schedule of Fair Value Hierarchy of Assets Carried at Fair Value and Measured on a Recurring Basis (Details) - Fair Value Measurements Recurring - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | $ 984,291 | $ 1,418,984 |
US Treasury Securities | Short-term Investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 983,678 | 1,415,130 |
Equity Securities | Other Non-current Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 613 | 3,854 |
Quoted prices in active markets for identical assets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 984,291 | 1,418,984 |
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 | 983,678 | 1,415,130 |
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 | 613 | 3,854 |
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) | Equity Securities | Other Non-current Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 0 | 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) | Equity Securities | Other Non-current Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | $ 0 | $ 0 |
Fair value - Additional Informa
Fair value - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |||||
Credit loss | $ 0 | $ 0 | $ 0 | $ 0 | |
Allowance for credit loss | $ 0 | $ 0 | $ 0 |
Fair value - Schedule of Debt S
Fair value - Schedule of Debt Securities (Details) - US Treasury Securities - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | $ 983,723 | $ 1,416,717 |
Gross unrealized gains | 97 | 96 |
Gross unrealized losses | (142) | (1,683) |
Fair value | 983,678 | 1,415,130 |
Debt securities, Due in one year or less, Amortized cost | 983,723 | 1,400,852 |
Debt securities, Due in one year or less, Fair value | $ 983,678 | 1,399,382 |
Debt securities, Due in one to two years, Amortized cost | 15,865 | |
Debt securities, Due in one to two years, Fair value | $ 15,748 |
Investment and other income (_3
Investment and other income (loss), net (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Investments, Debt and Equity Securities [Abstract] | ||||
Loss on equity securities | $ (3,004) | $ (4,299) | $ (3,241) | $ (7,078) |
Investment and other income, net | 15,088 | 2,690 | 29,725 | 3,279 |
Total investment and other income (loss), net | $ 12,084 | $ (1,609) | $ 26,484 | $ (3,799) |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Inventory Disclosure [Abstract] | ||||
Raw materials | $ 11,940 | $ 11,940 | $ 14,916 | |
Work in process | 427,776 | 427,776 | 357,275 | |
Finished goods | 47,138 | 47,138 | 55,020 | |
Total | 486,854 | 486,854 | $ 427,211 | |
Charge to reduce work in process inventory | $ 47,000 | $ 46,524 | $ 0 |
Accrued liabilities - Accrued L
Accrued liabilities - Accrued Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Payables and Accruals [Abstract] | ||
Clinical trial and related costs | $ 206,415 | $ 194,006 |
Employee compensation and benefits | 157,027 | 175,506 |
Gross-to-net deductions and third-party royalties | 138,155 | 119,289 |
Acquisition related expenses | 25,678 | 0 |
Contract manufacturing | 29,934 | 21,638 |
Other | 91,274 | 100,114 |
Total | $ 648,483 | $ 610,553 |
Accrued liabilities - Additiona
Accrued liabilities - Additional Information (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Dec. 31, 2022 | |
Payables and Accruals [Line Items] | ||
Acquisition related expenses | $ 25,678 | $ 0 |
Pfizer Merger | ||
Payables and Accruals [Line Items] | ||
Acquisition-related costs | 36,000 | |
Acquisition related expenses | $ 26,000 |
Share-based compensation (Detai
Share-based compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total share-based compensation expense | $ 93,216 | $ 54,129 | $ 157,155 | $ 98,042 |
Unrecognized compensation cost | 371,400 | 371,400 | ||
Employees Retention Awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Value of awards granted | 280,000 | 280,000 | ||
Restricted Stock Units (RSUs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Unrecognized compensation costs, excluding options | $ 62,000 | 62,000 | ||
Tranche One | Employees Retention Awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting rights, percentage | 20% | |||
Vesting period | 9 months | |||
Tranche Two | Employees Retention Awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting rights, percentage | 30% | |||
Vesting period | 18 months | |||
Tranche Three | Employees Retention Awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting rights, percentage | 25% | |||
Vesting period | 24 months | |||
Tranche Four | Employees Retention Awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting rights, percentage | 25% | |||
Vesting period | 30 months | |||
Research and development | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total share-based compensation expense | $ 49,845 | 23,446 | 79,912 | 46,522 |
Selling, general and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total share-based compensation expense | $ 43,371 | $ 30,683 | $ 77,243 | $ 51,520 |
Income taxes (Details)
Income taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Income Tax Disclosure [Abstract] | ||||
Income tax expense (benefit) | $ 2,891 | $ 107 | $ 7,515 | $ 1,361 |
Effective income tax expense (benefit) rate | (1.40%) | (0.10%) | (2.00%) | 0.50% |
Legal matters (Details)
Legal matters (Details) $ in Millions | 1 Months Ended | 6 Months Ended | |||
Sep. 14, 2022 USD ($) | Apr. 08, 2022 USD ($) | Jan. 22, 2021 petition | Jun. 30, 2023 USD ($) claim | Apr. 07, 2022 proceeding | |
Subsequent Event [Line Items] | |||||
Number of post-grant review proceedings request granted | proceeding | 2 | ||||
Dispute over ownership of intellectual property | |||||
Subsequent Event [Line Items] | |||||
Loss contingency, damages sought | $ 58 | ||||
Dispute over ownership of intellectual property | Minimum | |||||
Subsequent Event [Line Items] | |||||
Loss contingency accrual | $ 14 | ||||
Dispute over ownership of intellectual property | Maximum | |||||
Subsequent Event [Line Items] | |||||
Loss contingency accrual | $ 58 | ||||
Patent infringement | |||||
Subsequent Event [Line Items] | |||||
Number of petitions filed | petition | 2 | ||||
Awarded damages for past infringement | $ 41.8 | ||||
Reimbursement of attorney fees requested | $ 12 | ||||
Patent infringement | Minimum | |||||
Subsequent Event [Line Items] | |||||
Royalty fee percentage requested | 10% | ||||
Patent infringement | Maximum | |||||
Subsequent Event [Line Items] | |||||
Royalty fee percentage requested | 12% | ||||
Litigation related to the Pfizer Merger | |||||
Subsequent Event [Line Items] | |||||
Number of claims filed | claim | 6 |