Cover
Cover - shares | 6 Months Ended | |
Jun. 30, 2022 | Aug. 02, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-35969 | |
Entity Registrant Name | PTC Therapeutics, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 04-3416587 | |
Entity Address, Address Line One | 100 Corporate Court | |
Entity Address, City or Town | South Plainfield | |
Entity Address, State or Province | NJ | |
Entity Address, Postal Zip Code | 07080 | |
City Area Code | 908 | |
Local Phone Number | 222-7000 | |
Title of 12(b) Security | Common Stock, $0.001 par value per share | |
Trading Symbol | PTCT | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 71,540,965 | |
Entity Central Index Key | 0001070081 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 158,158 | $ 189,718 |
Marketable securities | 347,387 | 583,658 |
Trade and royalty receivables, net | 135,943 | 110,455 |
Inventory, net | 15,004 | 15,856 |
Prepaid expenses and other current assets | 38,184 | 54,681 |
Total current assets | 694,676 | 954,368 |
Fixed assets, net | 64,913 | 52,585 |
Intangible assets, net | 760,154 | 724,841 |
Goodwill | 82,341 | 82,341 |
Operating lease ROU assets | 141,635 | 77,421 |
Deposits and other assets | 60,338 | 46,500 |
Total assets | 1,804,057 | 1,938,056 |
Current liabilities: | ||
Accounts payable and accrued expenses | 330,918 | 288,784 |
Current portion of long-term debt | 149,908 | 149,540 |
Operating lease liabilities- current | 8,898 | 7,273 |
Finance lease liabilities- current | 2,174 | 3,000 |
Liability for sale of future royalties - current | 74,022 | 59,291 |
Other current liabilities | 1,451 | 1,460 |
Total current liabilities | 567,371 | 509,348 |
Long-term debt | 282,460 | 281,894 |
Contingent consideration payable | 163,000 | 239,900 |
Deferred tax liability | 137,110 | 137,110 |
Operating lease liabilities- noncurrent | 137,353 | 73,619 |
Finance lease liabilities- noncurrent | 18,675 | 20,053 |
Liability for sale of future royalties- noncurrent | 680,306 | 674,694 |
Total liabilities | 1,986,275 | 1,936,618 |
Stockholders' (deficit) equity: | ||
Common stock, $0.001 par value. Authorized 250,000,000 shares; issued and outstanding 71,505,889 shares at June 30, 2022. Authorized 250,000,000 shares; issued and outstanding 70,828,226 shares at December 31, 2021 | 71 | 71 |
Additional paid-in capital | 2,184,230 | 2,123,606 |
Accumulated other comprehensive loss | 10,251 | (24,282) |
Accumulated deficit | (2,376,770) | (2,097,957) |
Total stockholders' (deficit) equity | (182,218) | 1,438 |
Total liabilities and stockholders' equity | $ 1,804,057 | $ 1,938,056 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized shares (in shares) | 250,000,000 | 250,000,000 |
Common stock, issued shares (in shares) | 71,505,889 | 70,828,226 |
Common stock, outstanding shares (in shares) | 71,505,889 | 70,828,226 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Revenues: | ||||
Revenue | $ 165,526 | $ 116,676 | $ 314,262 | $ 234,620 |
Operating expenses: | ||||
Cost of product sales, excluding amortization of acquired intangible assets | 9,639 | 7,358 | 19,774 | 16,462 |
Amortization of intangible assets | 26,294 | 12,751 | 49,767 | 24,028 |
Research and development | 157,263 | 125,482 | 297,341 | 259,995 |
Selling, general and administrative | 79,892 | 68,878 | 153,162 | 129,973 |
Change in the fair value of deferred and contingent consideration | (15,200) | 700 | (26,900) | 800 |
Total operating expenses | 257,888 | 215,169 | 493,144 | 431,258 |
Loss from operations | (92,362) | (98,493) | (178,882) | (196,638) |
Interest expense, net | (21,976) | (22,559) | (45,490) | (41,718) |
Other (expense) income, net | (34,357) | 3,170 | (46,214) | (7,716) |
Loss before income tax expense | (148,695) | (117,882) | (270,586) | (246,072) |
Income tax expense | (3,392) | (488) | (8,227) | (940) |
Net loss attributable to common stockholders | $ (152,087) | $ (118,370) | $ (278,813) | $ (247,012) |
Weighted-average shares outstanding: | ||||
Basic | 71,372,940 | 70,414,632 | 71,294,458 | 70,302,241 |
Diluted | 71,372,940 | 70,414,632 | 71,294,458 | 70,302,241 |
Net loss per share-basic and diluted (in dollars per share) | ||||
Basic | $ (2.13) | $ (1.68) | $ (3.91) | $ (3.51) |
Diluted | $ (2.62) | $ (1.68) | $ (4.40) | $ (3.51) |
Net product revenue | ||||
Revenues: | ||||
Revenue | $ 143,701 | $ 103,113 | $ 273,534 | $ 194,393 |
Collaboration revenue | ||||
Revenues: | ||||
Revenue | 7 | 20,007 | ||
Royalty revenue | ||||
Revenues: | ||||
Revenue | $ 21,825 | $ 13,563 | $ 40,721 | $ 20,220 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (152,087) | $ (118,370) | $ (278,813) | $ (247,012) |
Other comprehensive loss: | ||||
Unrealized loss on marketable securities, net of tax of $0 | (156) | (75) | (3,069) | (1,369) |
Foreign currency translation gain (loss), net of tax of $0 | 29,015 | (7,269) | 37,602 | 16,239 |
Comprehensive loss | $ (123,228) | $ (125,714) | $ (244,280) | $ (232,142) |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Loss (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Statement of Comprehensive Income [Abstract] | ||||
Unrealized loss on marketable securities, tax | $ 0 | $ 0 | $ 0 | $ 0 |
Foreign currency translation gain, tax | $ 0 | $ 0 | $ 0 | $ 0 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' (Deficit) Equity - USD ($) $ in Thousands | Common stock | Additional paid-in capital Cumulative Effect Adjustment | Additional paid-in capital | Accumulated other comprehensive (loss) income | Accumulated deficit Cumulative Effect Adjustment | Accumulated deficit | Cumulative Effect Adjustment | Total |
Balance (in shares) at Dec. 31, 2020 | 69,718,096 | |||||||
Balance at the beginning of the period at Dec. 31, 2020 | $ 70 | $ (175,236) | $ 2,171,746 | $ (60,957) | $ 54,796 | $ (1,628,877) | $ (120,440) | $ 481,982 |
Increase (Decrease) in Stockholders' Equity | ||||||||
Exercise of options (in shares) | 475,942 | |||||||
Exercise of options | 13,144 | 13,144 | ||||||
Restricted stock vesting and issuance (in shares) | 292,171 | |||||||
Issuance of common stock in connection with an employee stock purchase plan (in shares) | 73,121 | |||||||
Issuance of common stock in connection with an employee stock purchase plan | 2,627 | 2,627 | ||||||
Share-based compensation expense | 51,406 | 51,406 | ||||||
Net loss | (247,012) | (247,012) | ||||||
Comprehensive income (loss) | 14,870 | 14,870 | ||||||
Balance (in shares) at Jun. 30, 2021 | 70,559,330 | |||||||
Balance at the end of the period at Jun. 30, 2021 | $ 70 | 2,063,687 | (46,087) | (1,821,093) | 196,577 | |||
Balance (in shares) at Mar. 31, 2021 | 70,405,905 | |||||||
Balance at the beginning of the period at Mar. 31, 2021 | $ 70 | 2,033,972 | (38,743) | (1,702,723) | 292,576 | |||
Increase (Decrease) in Stockholders' Equity | ||||||||
Exercise of options (in shares) | 60,159 | |||||||
Exercise of options | 1,389 | 1,389 | ||||||
Restricted stock vesting and issuance (in shares) | 20,145 | |||||||
Issuance of common stock in connection with an employee stock purchase plan (in shares) | 73,121 | |||||||
Issuance of common stock in connection with an employee stock purchase plan | 2,627 | 2,627 | ||||||
Share-based compensation expense | 25,699 | 25,699 | ||||||
Net loss | (118,370) | (118,370) | ||||||
Comprehensive income (loss) | (7,344) | (7,344) | ||||||
Balance (in shares) at Jun. 30, 2021 | 70,559,330 | |||||||
Balance at the end of the period at Jun. 30, 2021 | $ 70 | 2,063,687 | (46,087) | (1,821,093) | 196,577 | |||
Balance (in shares) at Dec. 31, 2021 | 70,828,226 | |||||||
Balance at the beginning of the period at Dec. 31, 2021 | $ 71 | 2,123,606 | (24,282) | (2,097,957) | 1,438 | |||
Increase (Decrease) in Stockholders' Equity | ||||||||
Exercise of options (in shares) | 125,020 | |||||||
Exercise of options | 3,198 | 3,198 | ||||||
Restricted stock vesting and issuance (in shares) | 461,380 | |||||||
Issuance of common stock in connection with an employee stock purchase plan (in shares) | 91,263 | |||||||
Issuance of common stock in connection with an employee stock purchase plan | 3,107 | 3,107 | ||||||
Share-based compensation expense | 54,319 | 54,319 | ||||||
Net loss | (278,813) | (278,813) | ||||||
Comprehensive income (loss) | 34,533 | 34,533 | ||||||
Balance (in shares) at Jun. 30, 2022 | 71,505,889 | |||||||
Balance at the end of the period at Jun. 30, 2022 | $ 71 | 2,184,230 | 10,251 | (2,376,770) | (182,218) | |||
Balance (in shares) at Mar. 31, 2022 | 71,337,041 | |||||||
Balance at the beginning of the period at Mar. 31, 2022 | $ 71 | 2,152,639 | (18,608) | (2,224,683) | (90,581) | |||
Increase (Decrease) in Stockholders' Equity | ||||||||
Exercise of options (in shares) | 27,832 | |||||||
Exercise of options | 754 | 754 | ||||||
Restricted stock vesting and issuance (in shares) | 49,753 | |||||||
Issuance of common stock in connection with an employee stock purchase plan (in shares) | 91,263 | |||||||
Issuance of common stock in connection with an employee stock purchase plan | 3,107 | 3,107 | ||||||
Share-based compensation expense | 27,730 | 27,730 | ||||||
Net loss | (152,087) | (152,087) | ||||||
Comprehensive income (loss) | 28,859 | 28,859 | ||||||
Balance (in shares) at Jun. 30, 2022 | 71,505,889 | |||||||
Balance at the end of the period at Jun. 30, 2022 | $ 71 | $ 2,184,230 | $ 10,251 | $ (2,376,770) | $ (182,218) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | |
Cash flows from operating activities | ||
Net loss | $ (278,813) | $ (247,012) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 55,494 | 28,573 |
Non-cash operating lease expense | 4,295 | 3,666 |
Non-cash royalty revenue related to sale of future royalties | (17,482) | (8,681) |
Non-cash interest expense on liability related to sale of future royalties | 37,825 | 38,083 |
Change in valuation of deferred and contingent consideration | (26,900) | 800 |
Unrealized gain on ClearPoint Equity Investments | (2,369) | (4,110) |
Unrealized gain on ClearPoint convertible debt security | (1,995) | (4,326) |
Unrealized gain on marketable securities - equity investments | 11,356 | (694) |
Loss on disposal of asset | 82 | |
Amortization of premiums on investments, net | 1,540 | 2,644 |
Amortization of debt issuance costs | 935 | 911 |
Share-based compensation expense | 54,319 | 51,406 |
Unrealized foreign currency transaction losses, net | 36,359 | 15,983 |
Changes in operating assets and liabilities: | ||
Inventory, net | 27 | 1,906 |
Prepaid expenses and other current assets | 16,431 | 15,649 |
Trade and royalty receivables, net | (29,549) | (9,420) |
Deposits and other assets | (974) | (289) |
Accounts payable and accrued expenses | (9,060) | (9,223) |
Other liabilities | (4,167) | (3,083) |
Deferred revenue | (4,085) | |
Net cash used in operating activities | (152,646) | (131,302) |
Cash flows from investing activities | ||
Purchases of fixed assets | (18,012) | (13,643) |
Purchases of marketable securities - available for sale | (40,429) | (192,931) |
Purchases of marketable securities - equity investments | (200,000) | |
Sale and redemption of marketable securities- available for sale | 257,534 | 514,716 |
Sale and redemption of marketable securities - equity investments | 3,630 | |
Acquisition of product rights and licenses | (81,426) | (21,838) |
Purchase of equity investment in ClearPoint | (100) | |
Net cash provided by investing activities | 121,297 | 86,204 |
Cash flows from financing activities | ||
Proceeds from exercise of options | 3,198 | 13,144 |
Proceeds from employee stock purchase plan | 3,107 | 2,627 |
Payment of finance lease principal | (1,276) | (2,224) |
Net cash provided by financing activities | 5,029 | 13,547 |
Effect of exchange rate changes on cash | 3,347 | 86 |
Net decrease in cash and cash equivalents | (22,973) | (31,465) |
Cash and cash equivalents, and restricted cash beginning of period | 197,218 | 216,312 |
Cash and cash equivalents, and restricted cash end of period | 174,245 | 184,847 |
Supplemental disclosure of cash information | ||
Cash paid for interest | 8,273 | 5,182 |
Cash paid for income taxes | 2,949 | 4,127 |
Supplemental disclosure of non-cash investing and financing activity | ||
Unrealized loss on marketable securities, net of tax | (3,069) | (1,369) |
Right-of-use assets obtained in exchange for operating lease obligations | 68,642 | 13 |
Acquisition of product rights and licenses | 26,687 | $ 18,369 |
Milestone payable | $ 50,000 |
The Company
The Company | 6 Months Ended |
Jun. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
The Company | PTC Therapeutics, Inc. Notes to Consolidated Financial Statements (unaudited) June 30, 2022 In thousands (except share and per share amounts unless otherwise noted) 1. The Company PTC Therapeutics, Inc. (the “Company” or “PTC”) is a science-driven global biopharmaceutical company focused on the discovery, development and commercialization of clinically differentiated medicines that provide benefits to patients with rare disorders. PTC’s ability to innovate to identify new therapies and to globally commercialize products is the foundation that drives investment in a robust and diversified pipeline of transformative medicines. PTC’s mission is to provide access to best-in-class treatments for patients who have few or no treatment options. PTC’s strategy is to leverage its strong scientific and clinical expertise and global commercial infrastructure to bring therapies to patients. PTC believes that this allows it to maximize value for all of its stakeholders. PTC has a portfolio pipeline that includes several commercial products and product candidates in various stages of development, including clinical, pre-clinical and research and discovery stages, focused on the development of new treatments for multiple therapeutic areas for rare diseases. The Company has two products, Translarna™ (ataluren) and Emflaza® (deflazacort), for the treatment of Duchenne muscular dystrophy (“DMD”), a rare, life threatening disorder. Translarna has marketing authorization in the European Economic Area (the “EEA”) for the treatment of nonsense mutation Duchenne muscular dystrophy (“nmDMD”) in ambulatory patients aged 2 years and older and in Russia for the treatment of nmDMD in patients aged two years and older. In July 2020, the European Commission approved the removal of the statement “efficacy has not been demonstrated in non-ambulatory patients” from the indication statement for Translarna. Translarna also has marketing authorization in Brazil for the treatment of nmDMD in ambulatory patients two years and older and for continued treatment of patients that become non-ambulatory. Emflaza is approved in the United States for the treatment of DMD in patients two years and older. The Company has a pipeline of gene therapy product candidates for rare monogenic diseases that affect the central nervous system (“CNS”) including Upstaza (eladocagene exuparvovec), formerly known as PTC-AADC, for the treatment of Aromatic L-Amino Acid Decarboxylase (“AADC”) deficiency (“AADC deficiency”), a rare CNS disorder arising from reductions in the enzyme AADC that results from mutations in the dopa decarboxylase gene. In July 2022, the European Commission approved Upstaza for the treatment of AADC deficiency for patients 18 months and older within the EEA. The Company is also preparing a biologics license application (“BLA”) for Upstaza for the treatment of AADC deficiency in the United States. In response to discussions with the United States Food and Drug Administration (“FDA”), the Company intends to provide additional information concerning the use of the commercial cannula for Upstaza in young patients. The Company expects to submit a BLA to the FDA in the fourth quarter of 2022. The Company holds the rights for the commercialization of Tegsedi® (inotersen) and Waylivra® (volanesorsen) for the treatment of rare diseases in countries in Latin America and the Caribbean pursuant to the Collaboration and License Agreement (the “Tegsedi-Waylivra Agreement”), dated August 1, 2018, by and between the Company and Akcea Therapeutics, Inc. (“Akcea”), a subsidiary of Ionis Pharmaceuticals, Inc. Tegsedi has received marketing authorization in the United States, the European Union (the “EU”) and Brazil for the treatment of stage 1 or stage 2 polyneuropathy in adult patients with hereditary transthyretin amyloidosis (“hATTR amyloidosis”). The Company began to make commercial sales of Tegsedi for the treatment of hATTR amyloidosis in Brazil in the second quarter of 2022 and it continues to make Tegsedi available in certain other countries within Latin America and the Caribbean through early access programs (“EAP Programs”). In August 2021, ANVISA, the Brazilian health regulatory authority, approved Waylivra as the first treatment for familial chylomicronemia syndrome (“FCS”) in Brazil and the Company began to make commercial sales of Waylivra in Brazil in the third quarter of 2022 while continuing to make Waylivra available in certain other countries within Latin America and the Caribbean through EAP Programs. Waylivra has also received marketing authorization in the EU for the treatment of FCS. Additionally, the Company submitted an application to ANVISA in December 2021 for the approval of Waylivra for the treatment of familial partial lipodystrophy, and it expects a regulatory decision on approval in the second half of 2022. The Company also has a spinal muscular atrophy (“SMA”) collaboration with F. Hoffman-La Roche Ltd and Hoffman-La Roche Inc. (referred to collectively as “Roche”) and the Spinal Muscular Atrophy Foundation (“SMA Foundation”). The SMA program has one approved product, Evrysdi® (risdiplam), which was approved by the FDA in August 2020 for the treatment of SMA in adults and children two months and older and by the European Commission in March 2021 for the treatment of 5q SMA in patients two months and older with a clinical diagnosis of SMA Type 1, Type 2 or Type 3 or with one to four SMN2 copies. Evrysdi also received marketing authorization for the treatment of SMA in Brazil in October 2020 and Japan in June 2021. In May 2022, the FDA approved a label expansion for Evrysdi to include infants under two months old with SMA. In addition to the Company’s SMA program, the Company’s splicing platform also includes PTC518, which is being developed for the treatment of Huntington’s disease (“HD”). The Company announced the results from its Phase 1 study of PTC518 in healthy volunteers in September 2021 demonstrating dose-dependent lowering of huntingtin messenger ribonucleic acid and protein levels, that PTC518 efficiently crosses the blood brain barrier at significant levels and that PTC518 was well tolerated. The Company initiated a Phase 2 study of PTC518 for the treatment of HD in the first quarter of 2022, which consists of an initial 12-week placebo-controlled phase focused on safety, pharmacology and pharmacodynamic effects followed by a nine-month placebo-controlled phase focused on PTC518 biomarker effect. The Company expects data from the initial 12-week phase of the Phase 2 study by the end of 2022. The Company’s Bio-e platform consists of small molecule compounds that target oxidoreductase enzymes that regulate oxidative stress and inflammatory pathways central to the pathology of a number of CNS diseases. The two most advanced molecules in the Company’s Bio-e platform are vatiquinone and PTC857. The Company initiated a registration-directed Phase 2/3 placebo-controlled trial of vatiquinone in children with mitochondrial disease associated seizures in the third quarter of 2020. The Company has experienced additional delays in enrolling this trial due to the COVID-19 pandemic and anticipates results from this trial to be available in the first quarter of 2023. The Company also initiated a registration-directed Phase 3 trial of vatiquinone in children and young adults with Friedreich ataxia in the fourth quarter of 2020 and anticipates results from this trial to be available in the second quarter of 2023. In the third quarter of 2021, the Company completed a Phase 1 trial in healthy volunteers to evaluate the safety and pharmacology of PTC857. PTC857 was found to be well-tolerated with no reported serious adverse events while demonstrating predictable pharmacology. The Company initiated a Phase 2 trial of PTC857 for amyotrophic lateral sclerosis in the first quarter of 2022. The most advanced molecule in the Company’s metabolic platform is PTC923, an oral formulation of synthetic sepiapterin, a precursor to intracellular tetrahydrobiopterin, which is a critical enzymatic cofactor involved in metabolism and synthesis of numerous metabolic products, for orphan diseases. The Company initiated a registration-directed Phase 3 trial for PTC923 for phenylketonuria (“PKU”) in the third quarter of 2021 and expects results from this trial to be available by the end of 2022. The Company also has two oncology agents that are in clinical development, unesbulin and emvododstat. The Company completed its Phase 1 trials evaluating unesbulin in leiomyosarcoma (“LMS”) and diffuse intrinsic pontine glioma (“DIPG”) in the fourth quarter of 2021. The Company initiated a registration-directed Phase 2/3 trial of unesbulin for the treatment of LMS in the first quarter of 2022, and it expects to initiate a registration-directed Phase 2 trial of unesbulin for the treatment of DIPG in the third quarter of 2022. The Company completed its Phase 1 trial evaluating emvododstat in acute myelogenous leukemia (“AML”), in the fourth quarter of 2021. The Company expects to provide further updates regarding its emvododstat program at a later date. In June 2020, the Company initiated a Phase 2/3 clinical trial evaluating the efficacy and safety of emvododstat in patients hospitalized with COVID-19. In February 2021, the Company announced the completion of the first stage of the Phase 2/3 trial. Given the changing nature of the COVID-19 pandemic to the outpatient treatment setting, the Company concluded enrollment in the Phase 2/3 trial early to review the data collected to date and make a decision on next steps. Based upon the Company’s initial analyses of all randomized subjects, there was a trend towards emvododstat benefit across several disease relevant endpoints including reduced hospitalizations and time to reduction of fever. Additionally, within the cohort of patients enrolled within five days of infection, emvododstat demonstrated a benefit with respect to time to respiratory improvement, duration of hospitalization, dyspnea resolution and cough relief. The Company plans to complete the remaining data analyses and will then formulate a strategy for next steps. In addition, the Company has a pipeline of product candidates and discovery programs that are in early clinical, pre-clinical and research and development stages focused on the development of new treatments for multiple therapeutic areas for rare diseases. The Company’s marketing authorization for Translarna in the EEA is subject to annual review and renewal by the European Commission following reassessment by the EMA of the benefit-risk balance of the authorization, which the Company refers to as the annual EMA reassessment. The marketing authorization in the EEA was last renewed in June 2022 and is effective, unless extended, through August 5, 2023. This marketing authorization is further subject to the specific obligation to conduct and submit the results of a multi-center, randomized, double-blind, 18-month, placebo-controlled trial, followed by an 18-month open-label extension, according to an agreed protocol, in order to confirm the efficacy and safety of Translarna. The Company refers to the trial and open-label extension together as Study 041. In June 2022, the Company announced top-line results from the placebo-controlled trial of Study 041. Within the placebo-controlled trial, Translarna showed a statistically significant treatment benefit across the entire intent to treat population as assessed by the 6-minute walk test, assessing ambulation and endurance, and in lower-limb muscle function as assessed by the North Star Ambulatory Assessment, a functional scale designed for boys affected by DMD. Additionally, Translarna showed a statistically significant treatment benefit across the intent to treat population within the 10-meter run/walk and 4-stair stair climb, each assessing ambulation and burst activity, while also showing a positive trend in the 4-stair stair descend although not statistically significant. Within the primary analysis group, Translarna demonstrated a positive trend across all endpoints, however, statistical significance was not achieved. Translarna was also well tolerated. The Company expects to submit a report on the placebo-controlled trial and the open-label extension data that has been collected to date to the EMA by the end of the third quarter of 2022, as required. Translarna is an investigational new drug in the United States. During the first quarter of 2017, the Company filed a New Drug Application (“NDA”) over protest with the FDA, for which the FDA granted a standard review. In October 2017, the Office of Drug Evaluation I of the FDA issued a complete response letter for the NDA, stating that it was unable to approve the application in its current form. In response, the Company filed a formal dispute resolution request with the Office of New Drugs of the FDA. In February 2018, the Office of New Drugs of the FDA denied PTC’s appeal of the Complete Response Letter. In its response, the Office of New Drugs recommended a possible path forward for the ataluren NDA submission based on the accelerated approval pathway. This would involve a re-submission of an NDA containing the current data on effectiveness of ataluren with new data to be generated on dystrophin production in nmDMD patients’ muscles. The Company followed the FDA’s recommendation and collected, using newer technologies via procedures and methods that the Company designed, such dystrophin data in a new study, Study 045, and announced the results of Study 045 in February 2021. Study 045 did not meet its pre-specified primary endpoint. In June 2022, the Company announced top-line results from the placebo-controlled trial of Study 041. The Company is preparing to have discussions with the FDA regarding a potential resubmission of the Translarna NDA. As of June 30, 2022, the Company had an accumulated deficit of approximately $2,376.8 million. The Company has financed its operations to date primarily through the private offerings in September 2019 of 1.50% convertible senior notes due 2026 and in August 2015 of 3.00% convertible senior notes due 2022 (see Note 9), public offerings of common stock in February 2014, October 2014, April 2018, January 2019, and September 2019, "at the market offering" of its common stock, its initial public offering of common stock in June 2013, proceeds from the Royalty Purchase Agreement dated as of July 17, 2020, by and among the Company, RPI 2019 Intermediate Finance Trust (“RPI”), and, solely for the limited purposes set forth therein, Royalty Pharma PLC (the “Royalty Purchase Agreement”) (see Note 2), private placements of its convertible preferred stock, collaborations, bank and institutional lender debt, grant funding and clinical trial support from governmental and philanthropic organizations and patient advocacy groups in the disease area addressed by the Company’s product candidates. Since 2014, the Company has also relied on revenue generated from net sales of Translarna for the treatment of nmDMD in territories outside of the United States, and since May 2017, the Company has generated revenue from net sales of Emflaza for the treatment of DMD in the United States. The Company has also relied on revenue associated with milestone and royalty payments from Roche pursuant to the License and Collaboration Agreement (the “SMA License Agreement”) dated as of November 23, 2011, by and among the Company, Roche and, for the limited purposes set forth therein, the SMA Foundation, under its SMA program. The Company expects that cash flows from the sales of its products, together with the Company’s cash, cash equivalents and marketable securities, will be sufficient to fund its operations for at least the next twelve months. |
Summary of significant accounti
Summary of significant accounting policies | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Summary of significant accounting policies | 2. Summary of significant accounting policies The Company’s complete listing of significant accounting policies is set forth in Note 2 of the notes to the Company’s audited financial statements as of December 31, 2021 included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (the "SEC") on February 22, 2022 (the "2021 Form 10-K"). Selected significant accounting policies are discussed in further detail below. Basis of presentation The accompanying financial information as of June 30, 2022 and for the three and six months ended June 30, 2022 and 2021 has been prepared by the Company, without audit, pursuant to the rules and regulations of the SEC. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States ("GAAP") have been condensed or omitted pursuant to such rules and regulations. These interim financial statements should be read in conjunction with the Company’s audited financial statements as of December 31, 2021 and notes thereto included in the 2021 Form 10-K. In the opinion of management, the unaudited financial information as of June 30, 2022 and for the three and six months ended June 30, 2022 and 2021 reflects all adjustments, which are normal recurring adjustments, necessary to present a fair statement of financial position, results of operations, stockholders’ equity, and cash flows. The results of operations for the three and six months ended June 30, 2022 and 2021 are not necessarily indicative of the results to be expected for the year ended December 31, 2022 or for any other interim period or for any other future year. Use of estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Significant estimates in these consolidated financial statements have been made in connection with the calculation of net product sales, royalty revenue, certain accruals related to the Company’s research and development expenses, valuation procedures for liability for sale of future royalties, valuation procedures for convertible notes, fair value of the contingent consideration, and the provision for or benefit from income taxes. Actual results could differ from those estimates. Changes in estimates are reflected in reported results in the period in which they become known. Restricted cash Restricted cash included in deposits and other assets on the consolidated balance sheet contains an unconditional, irrevocable and transferable letter of credit that was entered into during the twelve-month period ended December 31, 2019 in connection with obligations under a facility lease for the Company’s leased biologics manufacturing facility in Hopewell Township, New Jersey. The amount of the letter of credit is $7.5 million, is to be maintained for a term of not less than five years and has the potential to be reduced to $3.8 million if after five years the Company is not in default of its lease. Restricted cash also contains an unconditional, irrevocable and transferable letter of credit that was entered into during June 2022 in connection with obligations for the Company’s new facility lease in Warren, New Jersey. The amount of the letter of credit is $8.1 million and has the potential to be reduced to $4.1 million if after five years the Company is not in default of its lease. Both amounts are classified within deposits and other assets on the consolidated balance sheet due to the long-term nature of the letter of credit. Restricted cash also includes a bank guarantee of $0.5 million denominated in a foreign currency. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheet that sum to the total of the same amounts shown in the statement of cash flows: End of Beginning of period- period- June 30, December 31, 2022 2021 Cash and cash equivalents $ 158,158 $ 189,718 Restricted cash included in deposits and other assets 16,087 7,500 Total Cash, cash equivalents and restricted cash per statement of cash flows $ 174,245 $ 197,218 Marketable securities The Company’s marketable securities consists of both debt securities and equity investments. The Company considers its investments in debt securities with original maturities of greater than 90 days to be available for sale securities. Securities under this classification are recorded at fair value and unrealized gains and losses within accumulated other comprehensive income. The estimated fair value of the available for sale securities is determined based on quoted market prices or rates for similar instruments. In addition, the cost of debt securities in this category is adjusted for amortization of premium and accretion of discount to maturity. For available for sale debt securities in an unrealized loss position, the Company assesses whether it intends to sell or if it is more likely than not that the Company will be required to sell the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value. If the criteria are not met, the Company evaluates whether the decline in fair value has resulted from a credit loss or other factors. In making this assessment, management considers, among other factors, the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency, and adverse conditions specifically related to the security. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. If the present value of the cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded for the credit loss, limited by the amount that the fair value is less than the amortized costs basis. Any impairment that has not been recorded through an allowance for credit losses is recognized in other comprehensive income. For the three and six months ended June 30, 2022 and 2021, no allowance was recorded for credit losses. Marketable securities that are equity investments are measured at fair value, as it is readily available, and as such are classified as Level 1 assets. Unrealized holding gains and losses for these equity investments are components of other (expense) income, net within the consolidated statement of operations. Inventory and cost of product sales Inventory Inventories are stated at the lower of cost and net realizable value with cost determined on a first-in, first-out basis by product. The Company capitalizes inventory costs associated with products following regulatory approval when future commercialization is considered probable and the future economic benefit is expected to be realized. Products which may be used in clinical development programs are included in inventory and charged to research and development expense when the product enters the research and development process and no longer can be used for commercial purposes. Inventory used for marketing efforts are charged to selling, general and administrative expense. Amounts related to clinical development programs and marketing efforts are immaterial. The following table summarizes the components of the Company’s inventory for the periods indicated: June 30, 2022 December 31, 2021 Raw materials $ 1,382 $ 1,418 Work in progress 7,034 7,721 Finished goods 6,588 6,717 Total inventory $ 15,004 $ 15,856 The Company periodically reviews its inventories for excess amounts or obsolescence and writes down obsolete or otherwise unmarketable inventory to its estimated net realizable value. For the three and six months ended June 30, 2022, the Company recorded inventory write-downs of $0.3 million and $0.9 million, respectively, primarily related to product approaching expiration. For the three and six months ended June 30, 2021, the Company recorded inventory write-downs of $0.3 million and $1.7 million, respectively, primarily related to product approaching expiration. Additionally, though the Company’s product is subject to strict quality control and monitoring which it performs throughout the manufacturing processes, certain batches or units of product may not meet quality specifications resulting in a charge to cost of product sales. For the three and six months ended June 30, 2022 and 2021, these amounts were immaterial. Cost of product sales Cost of product sales consists of the cost of inventory sold, manufacturing and supply chain costs, storage costs, amortization of the acquired intangible asset, royalty payments associated with net product sales, and royalty payments to collaborative partners associated with royalty revenues and collaboration revenue related to milestones. Production costs are expensed as cost of product sales when the related products are sold or royalty revenues and collaboration revenue milestones are earned. Revenue recognition Net product revenue The Company’s net product revenue primarily consists of sales of Translarna in territories outside of the U.S. for the treatment of nmDMD and sales of Emflaza in the U.S. for the treatment of DMD. The Company recognizes revenue when its performance obligations with its customers have been satisfied. The Company’s performance obligations are to provide products based on customer orders from distributors, hospitals, specialty pharmacies or retail pharmacies. The performance obligations are satisfied at a point in time when the Company’s customer obtains control of the product, which is typically upon delivery. The Company invoices its customers after the products have been delivered and invoice payments are generally due within 30 to 90 days of the invoice date. The Company determines the transaction price based on fixed consideration in its contractual agreements. Contract liabilities arise in certain circumstances when consideration is due for goods the Company has yet to provide. As the Company has identified only one distinct performance obligation, the transaction price is allocated entirely to product sales. In determining the transaction price, a significant financing component does not exist since the timing from when the Company delivers product to when the customers pay for the product is typically less than one year. Customers in certain countries pay in advance of product delivery. In those instances, payment and delivery typically occur in the same month. The Company records product sales net of any variable consideration, which includes discounts, allowances, rebates related to Medicaid and other government pricing programs, and distribution fees. The Company uses the expected value or most likely amount method when estimating its variable consideration, unless discount or rebate terms are specified within contracts. The identified variable consideration is recorded as a reduction of revenue at the time revenues from product sales are recognized. These estimates for variable consideration are adjusted to reflect known changes in factors and may impact such estimates in the quarter those changes are known. Revenue recognized does not include amounts of variable consideration that are constrained. For the three months ended June 30, 2022 and 2021, net product sales outside of the United States were $86.9 million and $54.0 million, respectively, consisting of Translarna, Tegsedi, Waylivra, and Upstaza. Upstaza sales commenced during the three months period ended June 30, 2022. Translarna net revenues made up $77.0 million and $52.6 million of the net product sales outside of the United States for the three months ended June 30, 2022 and 2021, respectively. For the three months ended June 30, 2022 and 2021, net product sales in the United States were $56.8 million and $49.1 million, respectively, consisting solely of Emflaza. For the six months ended June 30, 2022 and 2021, net product sales outside of the United States were $168.1 million and $101.7 million, respectively, consisting of Translarna, Tegsedi, Waylivra, and Upstaza. Upstaza sales commenced during the six months period ended June 30, 2022. Translarna net revenues made up $156.2 million and $99.1 million of the net product sales outside of the United States for the six months ended June 30, 2022 and 2021, respectively. For the six months ended June 30, 2022 and 2021, net product sales in the United States were $105.4 million and $92.7 million, respectively, consisting solely of Emflaza. In relation to customer contracts, the Company incurs costs to fulfill a contract but does not incur costs to obtain a contract. These costs to fulfill a contract do not meet the criteria for capitalization and are expensed as incurred. The Company considers any shipping and handling costs that are incurred after the customer has obtained control of the product as a cost to fulfill a promise. Shipping and handling costs associated with finished goods delivered to customers are recorded as a selling expense. Collaboration and royalty revenue The terms of these agreements typically include payments to the Company of one or more of the following: nonrefundable, upfront license fees; milestone payments; research funding and royalties on future product sales. In addition, the Company generates service revenue through agreements that generally provide for fees for research and development services and may include additional payments upon achievement of specified events. At the inception of a collaboration arrangement, the Company needs to first evaluate if the arrangement meets the criteria in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 808 “Collaborative Arrangements” to then determine if ASC Topic 606 is applicable by considering whether the collaborator meets the definition of a customer. If the criteria are met, the Company assesses the promises in the arrangement to identify distinct performance obligations. For licenses of intellectual property, the Company assesses, at contract inception, whether the intellectual property is distinct from other performance obligations identified in the arrangement. If the licensing of intellectual property is determined to be distinct, revenue is recognized for nonrefundable, upfront license fees when the license is transferred to the customer and the customer can use and benefit from the license. If the licensing of intellectual property is determined not to be distinct, then the license will be bundled with other promises in the arrangement into one distinct performance obligation. The Company needs to determine if the bundled performance obligation is satisfied over time or at a point in time. If the Company concludes that the nonrefundable, upfront license fees will be recognized over time, the Company will need to assess the appropriate method of measuring proportional performance. For milestone payments, the Company assesses, at contract inception, whether the development or sales-based milestones are considered probable of being achieved. If it is probable that a significant revenue reversal will occur, the Company will not record revenue until the uncertainty has been resolved. Milestone payments that are contingent upon regulatory approval are not considered probable of being achieved until the applicable regulatory approvals or other external conditions are obtained as such conditions are not within the Company’s control. If it is probable that a significant revenue reversal will not occur, the Company will estimate the milestone payments using the most likely amount method. The Company will re-assess the development and sales-based milestones each reporting period to determine the probability of achievement. The Company recognizes royalties from product sales at the later of when the related sales occur or when the performance obligation to which the royalty has been allocated has been satisfied. If it is probable that a significant revenue reversal will not occur, the Company will estimate the royalty payments using the most likely amount method. The Company recognizes revenue for reimbursements of research and development costs under collaboration agreements as the services are performed. The Company records these reimbursements as revenue and not as a reduction of research and development expenses as the Company has the risks and rewards as the principal in the research and development activities. For the three months ended June 30, 2022 and 2021, the Company did not recognize collaboration revenue related to the SMA License Agreement with Roche. For the six months ended June 30, 2022 and 2021, the Company recognized collaboration revenue related to the SMA License Agreement with Roche of $0.0 million and $20.0 million, respectively. The first commercial sale of Evrysdi in the EU was made in March 2021. This event triggered a $20.0 million milestone payment to the Company from Roche for the six months ended June 30, 2021. For the three and six months ended June 30, 2022, the Company has recognized $21.8 million and $40.7 million of royalty revenue, respectively, related to Evrysdi. For the three and six months ended June 30, 2021, the Company has recognized $13.6 million and $20.2 million of royalty revenue, respectively, related to Evrysdi. Allowance for doubtful accounts The Company maintains an allowance for estimated losses resulting from the inability of its customers to make required payments. The Company estimates uncollectible amounts based upon current customer receivable balances, the age of customer receivable balances, the customer’s financial condition and current economic trends. The Company also assesses whether an allowance for expected credit losses may be required which includes a review of the Company’s receivables portfolio, which are pooled on a customer basis or country basis. In making its assessment of whether an allowance for credit losses is required, the Company considers its historical experience with customers, current balances, levels of delinquency, regulatory and legal environments, and other relevant current and future forecasted economic conditions. For the three and six months ended June 30, 2022 and 2021, no allowance was recorded for credit losses. The allowance for doubtful accounts was $0.1 million as of June 30, 2022 and $0.1 million as of December 31, 2021. Bad debt expense was immaterial for the three and six months ended June 30, 2022 and 2021. Liability for sale of future royalties On July 17, 2020, the Company, RPI, and, for the limited purposes set forth in the agreement, Royalty Pharma PLC, entered into the Royalty Purchase Agreement. Pursuant to the Royalty Purchase Agreement, the Company sold to RPI 42.933% (the “Assigned Royalty Payment”) of the Company’s right to receive sales-based royalty payments (the “Royalty”) on worldwide net sales of Evrysdi and any other product developed pursuant to the SMA License Agreement. In consideration for the sale of the Assigned Royalty Payments, RPI paid the Company $650.0 million in cash consideration. The Company has retained a 57.067% interest in the Royalty and all economic rights to receive the remaining potential regulatory and sales milestone payments under the SMA License Agreement, which milestone payments equal $300.0 million in the aggregate as of June 30, 2022. The Royalty Purchase Agreement will terminate 60 days following the earlier of the date on which Roche is no longer obligated to make any payments of the Royalty pursuant to the SMA License Agreement and the date on which RPI has received $1.3 billion in respect of the Assigned Royalty Payments. The cash consideration obtained pursuant to the Royalty Purchase Agreement is classified as debt and is recorded as “liability for sale of future royalties-current” and “liability for sale of future royalties-noncurrent” on the Company’s consolidated balance sheet based on the timing of the expected payments to be made to RPI. The fair value for the liability for sale of future royalties at the time of the transaction was based on the Company’s estimates of future royalties expected to be paid to RPI over the life of the arrangement, which was determined using forecasts from market data sources, which are considered Level 3 inputs. The liability is being amortized using the effective interest method over the life of the arrangement, in accordance with the respective guidance. The Company utilizes the prospective method to account for subsequent changes in the estimated future payments to be made to RPI. Refer to Note 9 for further details. Indefinite-lived intangible assets Indefinite-lived intangible assets consist of in process research and development ("IPR&D"). IPR&D acquired directly in a transaction other than a business combination is capitalized if the projects will be further developed or have an alternative future use; otherwise they are expensed. The fair values of IPR&D projects and license agreement assets acquired in business combinations are capitalized. Several methods may be used to determine the estimated fair value of the IPR&D and license agreement asset acquired in a business combination. The Company utilizes the "income method” and uses estimated future net cash flows that are derived from projected sales revenues and estimated costs. These projections are based on factors such as relevant market size, patent protection, and expected pricing and industry trends. The estimated future net cash flows are then discounted to the present value using an appropriate discount rate. These assets are treated as indefinite-lived intangible assets until completion or abandonment of the projects, at which time the assets are amortized over the remaining useful life or written off, as appropriate. Intangible assets with indefinite lives, including IPR&D, are tested for impairment if impairment indicators arise and, at a minimum, annually. However, an entity is permitted to first assess qualitative factors to determine if a quantitative impairment test is necessary. Further testing is only required if the entity determines, based on the qualitative assessment, that it is more likely than not that an indefinite-lived intangible asset’s fair value is less than its carrying amount. Otherwise, no further impairment testing is required. The indefinite-lived intangible asset impairment test consists of a one-step analysis that compares the fair value of the intangible asset with its carrying amount. If the carrying amount of an intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess. The Company considers many factors in evaluating whether the value of its intangible assets with indefinite lives may not be recoverable, including, but not limited to, expected growth rates, the cost of equity and debt capital, general economic conditions, the Company’s outlook and market performance of the Company’s industry and recent and forecasted financial performance. Goodwill Goodwill represents the amount of consideration paid in excess of the fair value of net assets acquired as a result of the Company’s business acquisitions accounted for using the acquisition method of accounting. Goodwill is not amortized and is subject to impairment testing at a reporting unit level on an annual basis or when a triggering event occurs that may indicate the carrying value of the goodwill is impaired. The Company reassess its reporting units as part of its annual segment review. An entity is permitted to first assess qualitative factors to determine if a quantitative impairment test is necessary. Further testing is only required if the entity determines, based on the qualitative assessment, that it is more likely than not that the fair value of the reporting unit is less than its carrying amount. Income Taxes On March 27, 2020, the United States enacted the Coronavirus Aid, Relief, and Economic Security Act, referred to herein as the CARES Act, as a response to the economic uncertainty resulting from a strain of novel coronavirus, COVID-19. The CARES Act includes modifications for net operating loss carryovers and carrybacks, limitations of business interest expense for tax, immediate refund of alternative minimum tax (“AMT”) credit carryovers as well as a technical correction to the 2017 Tax Cuts and Jobs Act ("the 2017 Tax Act") for qualified improvement property. On December 27, 2020, the Coronavirus Response and Relief Supplemental Appropriations Act of 2021 – a $900 billion relief package to deliver the second round of economic stimulus for individuals, families, and businesses was signed into law. The bill provides relief through multiple measures and expands many of the provisions already put into place under the CARES Act. As of June 30, 2022, the Company expects that these provisions will not have a material impact. Tax provisions of the CARES Act also include the deferral of certain payroll taxes, relief for retaining employees, and other provisions. The relief for retaining employees was not material to the financial statements and the deferral of certain payroll taxes amounted to $1.3 million as of June 30, 2022, which is accrued in other current liabilities on the consolidated balance sheet. Additionally, the Organization for Economic Co-operation and Development (“OECD”), the European Community (“the EC”), and individual taxing jurisdictions where the Company and its affiliates do business have recently focused on issues related to the taxation of multinational corporations. The OECD has released its comprehensive plan to create an agreed set of international rules for fighting base erosion and profit shifting. In addition, the OECD, the EC and individual taxing jurisdictions are examining changes to how taxing rights should be allocated among countries considering the digital economy. As a result, the tax laws in the U.S. and other countries in which the Company and its affiliates do business could change on a prospective or retroactive basis and any such changes could materially adversely affect the Company’s business. On December 22, 2017, the U.S. government enacted the 2017 Tax Act, which significantly revised U.S. tax law by, among other provisions, lowering the U.S. federal statutory corporate income tax rate to 21%, imposing a mandatory one-time transition tax on previously deferred foreign earnings, and eliminating or reducing certain income tax deductions. The Global Intangible Low-Taxed Income ("GILTI") provisions of the 2017 Tax Act require the Company to include in its U.S. income tax return foreign subsidiary earnings in excess of an allowable return on the foreign subsidiary’s tangible assets. The Company has elected to account for GILTI tax in the period in which it is incurred, and therefore has not provided any deferred tax impacts of GILTI in its consolidated financial statements for the period ended June 30, 2022. Starting in 2022, TCJA amendments to IRC Section 174 will no longer permit an immediate deduction for research and development (R&D) expenditures in the tax year that such costs are incurred. Instead, these IRC Section 174 development costs must now be capitalized and amortized over either a five- or 15-year period, depending on the location of the activities performed. The new amortization period begins with the midpoint of any taxable year that IRC Section 174 costs are first incurred, regardless of whether the expenditures were made prior to or after July 1, and runs until the midpoint of year five for activities conducted in the United States or year 15 in the case of development conducted on foreign soil. As a result of this tax law change, the Company recorded a federal tax provision for the six months ended June 30, 2022, in the amount of $1.6 million. Also, as a result of this tax law change, the Company recorded a state tax provision for the three months ended June 30, 2022, in the amount of $5.4 million. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and net operating loss and credit carryforwards. Deferred tax assets and liabilities are measured at rates expected to apply to taxable income in the years in which those temporary differences and carryforwards are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the statement of operations in the period that includes the enactment date. A valuation allowance is recorded when it is not more likely than not that all or a portion of the net deferred tax assets will be realized. On August 23, 2018, the Company completed its acquisition of Agilis Biotherapeutics, Inc. (“Agilis”), pursuant to an Agreement and Plan of Merger, dated as of July 19, 2018 (the “Agilis Merger Agreement”), by and among the Company, Agility Merger Sub, Inc., a Delaware corporation and the Company’s wholly owned, indirect subsidiary, Agilis and, solely in its capacity as the representative, agent and attorney-in-fact of the equityholders of Agilis, Shareholder Representative Services LLC, (the “Agilis Merger”). The Company recorded a deferred tax liability in conjunction with the Agilis Merger of $122.0 million in 2018, related to the tax basis difference in the IPRD indefinite-lived intangibles acquired. The Company’s policy is to record a deferred tax liability related to acquired IPR&D which may eventually be realized either upon amortization of the asset when the research is completed and a product is successfully launched or the write-off of the asset if it is abandoned or unsuccessful. Leases The Company determines if an arrangement is a lease at inception. This determination generally depends on whether the arrangement conveys to the Company the right to control the use of an explicitly or implicitly identified fixed asset for a period of time in exchange for consideration. Control of an underlying asset is conveyed to the Company if the Company obtains the rights to direct the use of and to obtain substantially all of the economic benefits from using the underlying asset. The Company has lease agreements which include lease and non-lease components, which the Company accounts for as a single lease component for all leases. Operating and finance leases are classified as right of use ("ROU") assets, short term lease liabilities, and long term lease liabilities. Operating and finance lease ROU assets and lease liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. ROU assets are amortized and lease liabilities accrete to yield straight-line expense over the term of the lease. Lease payments included in the measurement of the lease liability are comprised of fixed payments. Variable lease payments associated with the Company’s leases are recognized when the event, activity, or circumstance in the lease agreement on which those payments are assessed occurs. Variable lease payments are presented in the Company’s consolidated statements of operations in the same line item as expense arising from fixed lease payments for operating leases. Leases with an initial term of 12 months or less are not recorded on the consolidated balance sheet and the Company recognizes lease expense for these leases on a straight-line basis over the lease term. The Company applies this policy to all underlying asset categories. A lessee is required to discount its unpaid lease payments using the interest rate implicit in the lease or, if that rate cannot be readily determined, its incremental borrowing rate. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The Company gives consideration to its recent debt issuances as well as publicly available data for instruments with similar characteristics when calculating its incremental borrowing rates. The lease term for all of the Company’s leases includes the non-cancellable period of the lease plus any addition |
Leases
Leases | 6 Months Ended |
Jun. 30, 2022 | |
Leases | |
Leases | 3. Leases The Company leases office space in South Plainfield, New Jersey for its principal office under two noncancelable operating leases through August 2024, in addition to office and laboratory space in Bridgewater, New Jersey and other locations throughout the United States and office space in various countries for international employees primarily through workspace providers. On May 31, 2022, the Company’s lease for office space at 4041 Hadley Road in South Plainfield, New Jersey expired. The Company also leases approximately 220,500 square feet of office, manufacturing and laboratory space at a facility located in Hopewell Township, New Jersey pursuant to a Lease Agreement (the “Hopewell Lease”) with Hopewell Campus Owner LLC. The rental term of the Hopewell Lease commenced on July 1, 2020 and has an initial term of fifteen years (the “Hopewell Initial Term”), with two consecutive ten year renewal periods, each at the Company’s option. The aggregate rent for the Hopewell Initial Term will be approximately $111.5 million. The rental rate for the renewal periods will be 95% of the Prevailing Market Rate (as defined in the Hopewell Lease) and determined at the time of the exercise of the renewal. The Company is also responsible for maintaining certain insurance and the payment of proportional taxes, utilities and common area operating expenses. The Hopewell Lease contains customary events of default, representations, warranties and covenants. In May 2022, the Company entered into a Lease Agreement (the “Warren Lease”) with Warren CC Acquisitions, LLC (the “Warren Landlord”) relating to the lease of two entire buildings comprised of approximately 360,000 square feet of shell condition, modifiable space (the “Warren Premises”) at a facility located in Warren, New Jersey. The rental term of the Warren Lease commenced on June 1, 2022, with an initial term of seventeen years (the “Warren Initial Term”), followed by three consecutive five-year renewal periods at the Company’s option. The aggregate base rent for the Warren Initial Term will be approximately $163.0 million; provided, however, that if the Company is not subject to an Event of Default (as defined in the Warren Lease), the Company will be entitled to a base rent abatement over the first three years of the Warren Initial Term of approximately $18.6 million, reducing the Company’s total base rent obligation to $144.4 million. The rental rate for the renewal periods will be at the Fair Market Rental Value (as defined in the Warren Lease) and determined at the time of the exercise of the renewal. Beginning in the second lease year, the Company is also responsible for the payment of all taxes and operating expenses for the Warren Premises. As a result, the Company recorded an operating lease ROU asset of $62.2 million and an operating lease ROU liability of $62.2 million as of the commencement date. The Company plans on developing the Warren Premises into office and laboratory space. The Company is entitled to an allowance of approximately $36.2 million to be provided by the Warren Landlord to be used towards such improvements. The Landlord is providing the allowance to cover those assets that are real property improvements, such as structural components, roofs, flooring, etc., whose useful lives are typically longer in nature. In connection with the execution of the Warren Lease, the Company committed to fund a construction account with $3.6 million to go towards the Company’s improvements of the Warren Premises. Upon the first issuance of a temporary certificate of occupancy for the Warren Premises, the Company will receive $5.0 million from the Landlord, which the Company has committed to fund into the construction account. Subject to the terms of the Warren Lease, the Company has a right of first offer to purchase the Warren Premises if the Warren Landlord receives a bona fide third party offer to purchase the Warren Premises or the Warren Landlord decides to sell the Warren Premises. The Company also modified its Mountain View, California lease and entered into a new operating lease for an office in Tokyo, Japan during the six months ended June 30, 2022. These leases did not have a material impact on the Company’s consolidated financial statements. On June 19, 2020, the Company entered into a commercial manufacturing service agreement for a term of 12.5 years with MassBiologics of the University of Massachusetts Medical School ("MassBio"). The agreement will expire on December 31, 2032 unless the Company terminates it with 24 months prior written notice to MassBio. Pursuant to the terms of the agreement, MassBio agreed to provide the Company with certain dedicated space for its gene therapy AADC program. The Company concluded that the agreement contains an embedded lease as the Company controls the use of the four dedicated rooms and the equipment therein. The agreement included guaranteed lease payments of $15.0 million at the onset of the agreement and $3.0 million annually thereafter. The present value of the guaranteed lease payments was determined to be $41.4 million, which exceeded the assessed fair value of the Company’s share of the building. Therefore, the Company determined that the agreement was a finance lease, for which the Company recorded a finance lease ROU asset and corresponding finance lease liability at the onset of the lease agreement. Given that the leased asset is designed for the production of PTC’s AADC program and would not have an alternate use outside the PTC gene therapy platform without incurring significant costs, the Company determined that the lease should be treated as research and development expense under ASC 730. Accordingly, the full $41.4 million relating to the finance lease ROU asset was written off and expensed to research and development during the twelve month period ending December 31, 2020. The remaining balance for the finance lease ROU asset related to this arrangement is $0 as of June 30, 2022. As of June 30, 2022, the balance of the finance lease liabilities-current and finance lease liabilities-non-current are $2.2 million and $18.7 million, respectively, and are directly related to the Company’s MassBio agreement. As of December 31, 2021, the balance of the finance lease liabilities-current and finance lease liabilities-non current were $3.0 million and $20.1 million, respectively. The Company reported finance lease costs of $0.4 million and $0.8 million related to interest on the lease liability during the three and six month periods ending June 30, 2022, respectively. Additionally, the Company reported finance lease costs of $0.4 million and $0.8 million for the three and six month periods ending June 30, 2021, respectively. The Company also leases certain vehicles, lab equipment, and office equipment under operating leases. The Company’s leases have remaining operating lease terms ranging from 0.1 years to 16.9 years and certain of the leases include renewal options to extend the lease for up to 15 years. Rent expense was $5.9 million and $5.2 million for the three month periods ended June 30, 2022 and 2021, respectively, and $11.2 million and $10.6 million for the six month periods ended June 30, 2022 and 2021, respectively. The components of operating lease expense were as follows: Three Months Ended Three Months Ended Six Months Ended Six Months Ended June 30, 2022 June 30, 2021 June 30, 2022 June 30, 2021 Operating Lease Cost Fixed lease cost $ 4,764 $ 4,115 $ 8,890 $ 8,219 Variable lease cost 923 993 2,001 2,087 Short-term lease cost 257 119 338 283 Total operating lease cost $ 5,944 $ 5,227 $ 11,229 $ 10,589 Total operating lease cost is a component of operating expenses on the consolidated statements of operations. Supplemental lease term and discount rate information related to leases was as follows as of June 30, 2022 and December 31, 2021: June 30, 2022 December 31, 2021 Weighted-average remaining lease terms - operating leases (years) 13.03 10.87 Weighted-average discount rate - operating leases 8.70 % 8.91 % Weighted-average remaining lease terms - finance lease (years) 10.50 11.00 Weighted-average discount rate - finance lease 7.80 % 7.80 % Supplemental cash flow information related to leases was as follows as of June 30, 2022 and 2021: Six Months Ended June 30, 2022 2021 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 7,089 $ 6,816 Financing cash flows from finance lease 1,276 2,224 Operating cash flows from finance leases 1,724 776 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 68,642 $ 13 Future minimum lease payments under non-cancelable leases as of June 30, 2022 were as follows: Operating Leases Finance Lease 2022 (excludes the six months ended June 30, 2022) $ 7,665 $ — 2023 10,185 3,000 2024 18,251 3,000 2025 20,425 3,000 2026 and thereafter 213,775 21,000 Total lease payments 270,301 30,000 Less: Imputed Interest expense 124,050 9,947 Total $ 146,251 $ 20,053 |
Fair value of financial instrum
Fair value of financial instruments and marketable securities | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair value of financial instruments and marketable securities | 4. Fair value of financial instruments and marketable securities The Company follows the fair value measurement rules, which provide ● Level 1—Unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the balance sheet date. ● Level 2—Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (i.e., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs). ● Level 3—Inputs are unobservable and reflect the Company’s assumptions as to what market participants would use in pricing the asset or liability. The Company develops these inputs based on the best information available. Cash equivalents and marketable securities are reflected in the accompanying financial statements at fair value. The carrying amount of receivables and accounts payable and accrued expenses approximates fair value due to the short-term nature of those instruments. In May 2019, the Company purchased $4.0 million of shares of ClearPoint Neuro, Inc.’s ("ClearPoint"), formerly known as MRI Interventions, Inc., common stock, at a purchase price of $3.10 per share, in connection with a securities purchase agreement that the Company entered into with ClearPoint, a publicly traded medical device company. In February 2021, the Company purchased $0.1 million of shares of ClearPoint’s common stock, at a purchase price of $23.50 per share, in connection with ClearPoint’s underwritten public offering of common stock. The Company determined that the May 2019 and February 2021 ClearPoint equity investments (collectively, the “ClearPoint Equity Investments”) represent financial instruments, and therefore, are recorded at fair value, which is readily determinable. The ClearPoint Equity Investments are components of deposits and other assets on the consolidated balance sheet. During the three and six months ended June 30, 2022, the Company recorded an unrealized gain of $3.4 million and an unrealized gain of $2.4 million, respectively. During the three and six months ended June 30, 2021, the Company recorded an unrealized loss of $2.7 million and an unrealized gain of $4.1 million, respectively. These unrealized gains and losses are components of other (expense) income, net within the consolidated statement of operations. The fair value of the ClearPoint Equity Investments was $16.9 million and $14.5 million as of June 30, 2022 and December 31, 2021, respectively. The Company classifies the ClearPoint Equity Investments as Level 1 assets within the fair value hierarchy, as the value is based on a quoted market price in an active market, which is not adjusted. In January 2020, the Company purchased a $10.0 million convertible note from ClearPoint that the Company can convert into ClearPoint shares at a conversion rate of $6.00 per share at any point throughout the term of the loan, which matures five years from the purchase date. The Company determined that the convertible note represents an available for sale debt security and the Company has elected to record it at fair value under ASC 825. The Company classifies its ClearPoint convertible debt security as a Level 2 asset within the fair value hierarchy, as the value is based on inputs other than quoted prices that are observable. The fair value of the ClearPoint convertible debt security is determined at each reporting period by utilizing a Black-Scholes option pricing model, as well as a present value of expected cash flows from the debt security utilizing the risk free rate and the estimated credit spread as of the valuation date as the discount rate. During the three and six months ended June 30, 2022, the Company recorded unrealized gains of $3.5 million and $2.0 million, respectively. During the three and six months ended June 30, 2021, the Company recorded an unrealized loss of $3.5 million and an unrealized gain of $4.3 million, respectively. These unrealized gains and losses are components of other (expense) income, net within the consolidated statement of operations. The fair value of the convertible debt security was $23.0 million and $21.0 million as of June 30, 2022 and December 31, 2021, respectively. The convertible debt security is considered to be long term and is included as a component of deposits and other assets on the consolidated balance sheet. Other than the ClearPoint Equity Investments and the convertible debt security, no other items included in deposits and other assets on the consolidated balance sheets are fair valued. In February 2021, the Company invested $200.0 million in two mutual funds. In August 2021, the Company made a $10.0 investment into a third mutual fund that is denominated in a foreign currency. All of these are equity investments and are classified as marketable securities on the Company’s consolidated balance sheets. These equity investments are reported at fair value, as it is readily available, and as such are classified as Level 1 assets. Unrealized holding gains and losses for these equity investments are included as components of other (expense) income, net within the consolidated statement of operations. For the three and six months ended June 30, 2022, the Company had $4.9 million and $11.4 million of unrealized net losses relating to the equity investments still held at the reporting date, respectively. For the three and six months ended June 30, 2021, the Company had $1.0 million and $0.7 million unrealized net gains relating to the equity investments still held at the reporting date, respectively. For the three and six months ended June 30, 2022, the Company had redemptions of $1.2 million and $3.6 million, respectively. The Company did not have any redemptions for the three and six months ended June 30, 2021. For the three and six months ended June 30, 2022, the Company had foreign currency unrealized losses of $0.3 million and foreign currency unrealized gains of $0.4 million, respectively, relating to these equity investments. For the three and six months ended June 30, 2021, the Company did not have any foreign currency gains or losses relating to these equity investments. Fair value of marketable securities that are classified as available for sale debt securities is based upon market prices using quoted prices in active markets for identical assets quoted on the last day of the period. In establishing the estimated fair value of the remaining available for sale debt securities, the Company used the fair value as determined by its investment advisors using observable inputs other than quoted prices. The following represents the fair value using the hierarchy described above for the Company’s financial assets and liabilities that are required to be measured at fair value on a recurring basis as of June 30, 2022 and December 31, 2021: June 30, 2022 Quoted prices Significant in active other Significant markets for observable unobservable identical assets inputs inputs Total (level 1) (level 2) (level 3) Marketable securities - available for sale $ 154,973 $ — $ 154,973 $ — Marketable securities - equity investments $ 192,414 $ 192,414 $ — $ — ClearPoint Equity Investments $ 16,894 $ 16,894 $ — $ — ClearPoint convertible debt security $ 22,966 $ — $ 22,966 $ — Contingent consideration payable- development and regulatory milestones $ 78,700 $ — $ — $ 78,700 Contingent consideration payable- net sales milestones and royalties $ 84,300 $ — $ — $ 84,300 December 31, 2021 Quoted prices Significant in active other Significant markets for observable unobservable identical assets inputs inputs Total (level 1) (level 2) (level 3) Marketable securities - available for sale $ 376,685 $ — $ 376,685 $ — Marketable securities - equity investments $ 206,973 $ 206,973 $ — $ — ClearPoint Equity Investments $ 14,525 $ 14,525 $ — $ — ClearPoint convertible debt security $ 20,971 $ — $ 20,971 $ — Contingent consideration payable- development and regulatory milestones $ 139,300 $ — $ — $ 139,300 Contingent consideration payable- net sales milestones and royalties $ 100,600 $ — $ — $ 100,600 No transfers of assets between Level 1, Level 2, or Level 3 of the fair value measurement hierarchy occurred during the periods ended June 30, 2022 and December 31, 2021. The following is a summary of marketable securities accounted for as available for sale debt securities at June 30, 2022 and December 31, 2021: June 30, 2022 Amortized Gross Unrealized Cost Gains Losses Fair Value Corporate debt securities 152,771 — (3,483) 149,288 Government obligations 5,873 — (188) 5,685 Total $ 158,644 $ — $ (3,671) $ 154,973 December 31, 2021 Amortized Gross Unrealized Cost Gains Losses Fair Value Commercial paper $ 75,275 5 (1) $ 75,279 Corporate debt securities 268,246 81 (644) 267,683 Asset-backed securities 15,287 16 (5) 15,298 Government obligations 18,479 5 (59) 18,425 Total $ 377,287 $ 107 $ (709) $ 376,685 For available for sale debt securities in an unrealized loss position, the Company assesses whether it intends to sell or if it is more likely than not that the Company will be required to sell the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value. For the three and six months ended June 30, 2022, no write downs occurred. The Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost basis, which may be maturity. The Company also reviews its available for sale debt securities in an unrealized loss position and evaluates whether the decline in fair value has resulted from credit losses or other factors. This review is subjective, as it requires management to evaluate whether an event or change in circumstances has occurred in that period that may be related to credit issues. For the three and six months ended June 30, 2022 and 2021, no allowance was recorded for credit losses. Unrealized gains and losses are reported as a component of accumulated other comprehensive (loss) income in stockholders’ equity. For the three and six months ended June 30, 2022, the Company had $0.3 million and $0.4 million realized losses from the sale of available for sale debt securities, respectively. For the three and six months ended June 30, 2021, the Company had $0.0 million and $0.7 million realized gains from the sale of available for sale debt securities, respectively. Realized gains and losses are reported as a component of interest expense, net in the consolidated statement of operations. The unrealized losses and fair values of available for sale debt securities that have been in an unrealized loss position for a period of less than and greater than 12 months as of June 30, 2022 are as follows: June 30, 2022 Securities in an unrealized loss Securities in an unrealized loss position less than 12 months position greater than or equal to 12 months Total Unrealized losses Fair Value Unrealized losses Fair Value Unrealized losses Fair Value Corporate debt securities (3,173) 133,542 (310) 10,745 (3,483) 144,287 Government obligations (188) 5,686 — — (188) 5,686 Total $ (3,361) $ 139,228 $ (310) $ 10,745 $ (3,671) $ 149,973 The unrealized losses and fair values of available for sale debt securities that have been in an unrealized loss position for a period of less than and greater than 12 months as of December 31, 2021 are as follows: December 31, 2021 Securities in an unrealized loss Securities in an unrealized loss position less than 12 months position greater than or equal to 12 months Total Unrealized losses Fair Value Unrealized losses Fair Value Unrealized losses Fair Value Commercial paper $ (1) 12,992 — — (1) 12,992 Corporate debt securities (608) 217,540 (36) 4,985 (644) 222,525 Asset-backed securities (5) 10,786 — — (5) 10,786 Government obligations (59) 15,483 — — (59) 15,483 Total $ (673) $ 256,801 $ (36) $ 4,985 $ (709) $ 261,786 Available for sale debt securities at June 30, 2022 and December 31, 2021 mature as follows: June 30, 2022 Less Than More Than 12 Months 12 Months Corporate debt securities 86,892 62,396 Government obligations — 5,685 Total $ 86,892 $ 68,081 December 31, 2021 Less Than More Than 12 Months 12 Months Commercial paper $ 75,279 $ — Corporate debt securities 131,606 136,077 Asset-backed securities 8,724 6,574 Government obligations 6,002 12,423 Total $ 221,611 $ 155,074 The Company classifies all of its marketable securities as current as they are all either available for sale debt securities or equity investments and are available for current operations. Convertible senior notes In August 2015, the Company issued $150.0 million of 3.00% convertible senior notes due August 15, 2022 (the “2022 Convertible Notes”). In September 2019, the Company issued $287.5 million of 1.50% convertible senior notes due September 15, 2026 (the “2026 Convertible Notes,” together with the “2022 Convertible Notes,” the “Convertible Notes”). The fair value of the Convertible Notes, which differs from their carrying values, is influenced by interest rates, the Company’s stock price and stock price volatility and is determined by prices for the Convertible Notes observed in market trading which are Level 2 inputs. The estimated fair value of the 2022 Convertible Notes at June 30, 2022 and December 31, 2021 was $150.6 million and $158.3 million, respectively. The estimated fair value of the 2026 Convertible Notes at June 30, 2022 and December 31, 2021 was $300.4 million and $305.3 million, respectively. Level 3 valuation The contingent consideration payable is fair valued each reporting period with the change in fair value recorded as a gain or loss within the change in the fair value of deferred and contingent consideration on the consolidated statements of operations. The fair value of the development and regulatory milestones is estimated utilizing a probability adjusted, discounted cash flow approach. The discount rates are estimated utilizing Corporate B rated bonds maturing in the years of expected payments based on the Company’s estimated development timelines for the acquired product candidate. At June 30, 2022, the weighted average discount rate for the development and regulatory milestones was 8.5% and the weighted average probability of success was 34%. The fair value of the net sales milestones and royalties is determined utilizing an option pricing model with Monte Carlo simulation to simulate a range of possible payment scenarios, and the average of the payments in these scenarios is then discounted to calculate present fair value. At June 30, 2022, the weighted average discount rate for the net sales milestones and royalties was 12.0% and the weighted average probability of success for the net sales milestones was 49%. The table presented below is a summary of changes in the fair value of the Company’s Level 3 valuations for the contingent consideration payable for the periods ended June 30, 2022 and June 30, 2021: Level 3 liabilities Contingent consideration payable- Contingent consideration payable- development and regulatory net sales milestones and royalties milestones Beginning balance as of December 31, 2021 $ 139,300 $ 100,600 Additions — — Change in fair value (10,600) (16,300) Reclass to accounts payable and accrued expenses (50,000) — Payments — — Ending balance as of June 30, 2022 $ 78,700 $ 84,300 Level 3 liabilities Contingent consideration payable- Contingent consideration payable- development and regulatory net sales milestones and royalties milestones Beginning balance as of December 31, 2020 $ 139,200 $ 101,200 Additions — — Change in fair value 400 400 Payments — — Ending balance as of June 30, 2021 $ 139,600 $ 101,600 The following significant unobservable inputs were used in the valuation of the contingent consideration payable for the periods ended June 30, 2022 and December 31, 2021: June 30, 2022 Fair Value Valuation Technique Unobservable Input Range Contingent consideration payable- $78,700 Probability-adjusted discounted cash flow Potential development and regulatory milestones $0 - $331 million Contingent considerable payable- net sales $84,300 Option-pricing model with Monte Carlo simulation Potential net sales milestones $0 - $150 million December 31, 2021 Fair Value Valuation Technique Unobservable Input Range Contingent consideration payable- $139,300 Probability-adjusted discounted cash flow Potential development and regulatory milestones $0 - $381 million Contingent considerable payable- net sales $100,600 Option-pricing model with Monte Carlo simulation Potential net sales milestones $0 - $150 million The contingent consideration payables are classified Level 3 liabilities as their valuation requires substantial judgment and estimation of factors that are not currently observable in the market. If different assumptions were used for the various inputs to the valuation approaches, including but not limited to, assumptions involving probability adjusted sales estimates for the gene therapy platform and estimated discount rates, the estimated fair value could be significantly higher or lower than the fair value determined. |
Accounts payable and accrued ex
Accounts payable and accrued expenses | 6 Months Ended |
Jun. 30, 2022 | |
Payables and Accruals [Abstract] | |
Accounts payable and accrued expenses | 5. Accounts payable and accrued expenses Accounts payable and accrued expenses at June 30, 2022 and December 31, 2021 consist of the following: June 30, December 31, 2022 2021 Employee compensation, benefits, and related accruals $ 35,834 $ 55,733 Income tax payable 7,582 1,287 Consulting and contracted research 30,866 26,434 Professional fees 5,196 3,547 Sales allowance 64,335 61,662 Sales rebates 71,776 68,770 Royalties 34,230 35,679 Accounts payable 22,881 23,033 Milestone payable 50,000 — Other 8,218 12,639 Total $ 330,918 $ 288,784 |
Capitalization
Capitalization | 6 Months Ended |
Jun. 30, 2022 | |
Stockholders' Equity Note [Abstract] | |
Capitalization | 6. Capitalization In August 2019, the Company entered into an At the Market Offering Sales Agreement (the “Sales Agreement”) with Cantor Fitzgerald and RBC Capital Markets, LLC (together, the “Sales Agents”), pursuant to which, the Company may offer and sell shares of its common stock, having an aggregate offering price of up to $125.0 million from time to time through the Sales Agents by any method that is deemed to be an “at the market offering” as defined in Rule 415(a)(4) promulgated under the Securities Act of 1933, as amended. No shares were sold during the three and six months ended June 30, 2022 and 2021. The remaining shares of the Company’s common stock available to be issued and sold, under the At the Market Offering, have an aggregate offering price of up to $93.0 million as of June 30, 2022. |
Net loss per share
Net loss per share | 6 Months Ended |
Jun. 30, 2022 | |
Earnings Per Share [Abstract] | |
Net loss per share | 7. Net loss per share Basic and diluted net loss per share is computed by dividing net loss by the weighted-average number of common shares outstanding. Potentially dilutive securities were excluded from the diluted calculation because their effect would be anti-dilutive. The following tables set forth the computation of basic and diluted net loss per share: Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Numerator Net loss $ (152,087) $ (118,370) $ (278,813) $ (247,012) Denominator Denominator for basic and diluted net loss per share 71,372,940 70,414,632 71,294,458 70,302,241 Net loss per share: Basic and diluted $ (2.13) * $ (1.68) * $ (3.91) * $ (3.51) * * In the three and six months ended June 30, 2022 and 2021, the Company experienced a net loss and therefore did not report any dilutive share impact. The following table shows historical dilutive common share equivalents outstanding, which are not included in the above historical calculation, as the effect of their inclusion is anti-dilutive during each period. As of June 30, 2022 2021 Stock Options 11,815,952 11,031,460 Unvested restricted stock awards and units 2,514,827 1,532,430 Total 14,330,779 12,563,890 |
Stock award plan
Stock award plan | 6 Months Ended |
Jun. 30, 2022 | |
Share-based Payment Arrangement [Abstract] | |
Stock award plan | 8. Stock award plan In May 2013, the Company’s Board of Directors and stockholders approved the 2013 Long-Term Incentive Plan, which became effective upon the closing of the Company’s initial public offering. On June 8, 2022 (the “Restatement Effective Date”), the Company’s stockholders approved the Amended and Restated 2013 Long-Term Incentive Plan (the “Amended 2013 LTIP”). The Amended 2013 LTIP provides for the grant of incentive stock options, nonstatutory stock options, restricted stock units and other stock-based awards. The number of shares of common stock reserved for issuance under the Amended 2013 Incentive Plan immediately prior to the Restatement Effective Date and (3) the number of shares subject to awards granted under the 2013 Long-Term Incentive Plan prior to the Restatement Effective Date that are outstanding as of the Restatement Effective Date, plus (B) from and after the Restatement Effective Date, an additional 8,475,000 shares of Common Stock. As of June 30, 2022, awards for 9,306,210 shares of common stock are available for issuance under the Amended 2013 LTIP. There are no additional shares of common stock available for issuance under the Company’s 1998 Employee, Director and Consultant Stock Option Plan, 2009 Equity and Long Term Incentive Plan or 2013 Stock Incentive Plan. In January 2020, the Company’s Board of Directors approved the 2020 Inducement Stock Incentive Plan. The 2020 Inducement Stock Incentive Plan provides for the grant of incentive stock options, nonstatutory stock options, restricted stock awards and other stock-based awards for up to, at the time, an aggregate of 1,000,000 shares of common stock. Any grants made under the 2020 Inducement Stock Incentive Plan must be made pursuant to the Nasdaq Listing Rule 5635(c)(4) inducement grant exception as a material component of the Company’s new hires’ employment compensation. In December 2020, the Company’s Board of Directors approved an additional 1,000,000 shares of common stock that may be issued under the 2020 Inducement Stock Incentive Plan. In April 2022, the Company’s Board of Directors approved a reduction in the total number of shares of common stock that may be issued under the 2020 Inducement Stock Incentive Plan to 1,300,000 shares. The Board of Directors has the authority to select the individuals to whom options are granted and determine the terms of each option, including (i) the number of shares of common stock subject to the option; (ii) the date on which the option becomes exercisable; (iii) the option exercise price, which, in the case of incentive stock options, must be at least 100% (110% in the case of incentive stock options granted to a stockholder owning in excess of 10% of the Company’s stock) of the fair market value of the common stock as of the date of grant; and (iv) the duration of the option (which, in the case of incentive stock options, may not exceed ten years). Options typically vest over a four-year period. From January 1, 2022 through June 30, 2022, the Company issued a total of 1,471,290 stock options to various employees. Of those, 104,385 were inducement grants for non-statutory stock options, all of which were made pursuant to the 2020 Inducement Stock Incentive Plan. A summary of stock option activity is as follows: Weighted- Weighted- average Aggregate average remaining intrinsic Number of exercise contractual value(in options price term thousands) Outstanding at December 31, 2021 10,772,582 $ 43.66 Granted 1,471,290 37.86 Exercised (125,020) 25.59 Forfeited/Cancelled (302,900) 49.52 Outstanding at June 30, 2022 11,815,952 $ 42.98 6.79 years $ 52,784 Vested or Expected to vest at June 30, 2022 4,180,409 $ 47.70 8.42 years $ 6,220 Exercisable at June 30, 2022 7,208,199 $ 39.96 5.72 years $ 45,995 The fair value of grants made in the six months ended June 30, 2022 was contemporaneously estimated on the date of grant using the following assumptions: Six months ended June 30, 2022 Risk-free interest rate 1.55% - 3.07% Expected volatility 55.33% - 73.56% Expected term 5.5 years The Company assumed no expected dividends for all grants. The weighted average grant date fair value of options granted during the six months ended June 30, 2022 was $23.60 per share. The expected term of options was estimated based on the Company’s historical exercise data and the expected volatility of options was estimated based on the Company’s historical stock volatility. The risk-free rate of the options was based on U.S. Government Securities Treasury Constant Maturities yields at the date of grant for a term similar to the expected term of the option. Restricted Stock Awards and Restricted Stock Units The following table summarizes information on the Company’s restricted stock awards and units: Restricted Stock Awards and Units Weighted Average Grant Number of Date Shares Fair Value Unvested at December 31, 2021 1,519,831 $ 55.43 Granted 1,580,362 38.03 Vested (476,223) 50.44 Forfeited (109,143) 47.85 Unvested at June 30, 2022 2,514,827 $ 45.74 Employee Stock Purchase Plan The Company recorded share-based compensation expense in the statement of operations related to incentive stock options, nonstatutory stock options, restricted stock awards, restricted stock units and the ESPP as follows: Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Research and development $ 13,798 $ 13,443 $ 26,832 $ 27,168 Selling, general and administrative 13,932 12,256 27,487 24,238 Total $ 27,730 $ 25,699 $ 54,319 $ 51,406 As of June 30, 2022, there was approximately $227.4 million of total unrecognized compensation cost related to unvested share-based compensation arrangements granted under the 2009 Equity and Long Term Incentive Plan, the 2013 Long Term Incentive Plan and equity awards made pursuant to the Nasdaq Listing Rule 5635(c)(4) inducement grant exception for new hires. This cost is expected to be recognized as share-based compensation expense over the weighted average remaining service period of approximately 2.47 years. |
Debt
Debt | 6 Months Ended |
Jun. 30, 2022 | |
Debt Disclosure [Abstract] | |
Debt | 9. Debt Liability for sale of future royalties In July 2020, the Company entered into the Royalty Purchase Agreement. As RPI’s interest is explicitly limited, the $650.0 million cash consideration was classified as debt and is recorded as “liability for sale of future royalties-current” and “liability for sale of future royalties-noncurrent” on the Company’s consolidated balance sheet based on the timing of the expected payments to be made to RPI. The fair value for the liability for sale of future royalties at the time of the transaction was based on the Company’s estimates of future royalties expected to be paid to RPI over the life of the arrangement, which was determined using forecasts from market data sources, which are considered Level 3 inputs. The liability is being amortized using the effective interest method over the life of the arrangement, in accordance with ASC 470 and ASC 835. The initial annual effective interest rate was determined to be 11.0%. The Company utilizes the prospective method to account for subsequent changes in the estimated future payments to be made to RPI and updates the effective interest rate on a quarterly basis. Issuance costs related to the transaction were determined to be immaterial. The following table shows the activity within the “liability for sale of future royalties- current” and “liability for sale of future royalties- noncurrent” accounts for the six months ended June 30, 2022: Six Months Ended June 30, Liability for sale of future royalties- (current and noncurrent) 2022 Beginning balance as of December 31, 2021 $ 733,985 Less: Non-cash royalty revenue payable to RPI (17,482) Plus: Non-cash interest expense recognized 37,825 Ending balance $ 754,328 Effective interest rate as of June 30, 2022 10.1 % Non-cash interest expense is recorded in the statement of operations within “Interest expense, net”. 2026 Convertible Notes In September 2019, the Company issued, at par value, $287.5 million aggregate principal amount of 1.50% convertible senior notes due 2026, which included an option to purchase up to an additional $37.5 million in aggregate principal amount of the 2026 Convertible Notes, which was exercised in full by the initial purchasers. The 2026 Convertible Notes bear cash interest at a rate of 1.50% per year, payable semi-annually on March 15 and September 15 of each year, beginning on March 15, 2020. The 2026 Convertible Notes will mature on September 15, 2026, unless earlier repurchased or converted. The net proceeds to the Company from the offering were $279.3 million after deducting the initial purchasers’ discounts and commissions and the offering expenses payable by the Company. The 2026 Convertible Notes are governed by an indenture (the "2026 Convertible Notes Indenture") with U.S Bank National Association as trustee (the "2026 Convertible Notes Trustee"). Holders of the 2026 Convertible Notes may convert their 2026 Convertible Notes at their option at any time prior to the close of business on the business day immediately preceding March 15, 2026 only under the following circumstances: ● during any calendar quarter commencing on or after December 31, 2019 (and only during such calendar quarter), if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; ● during the five business day period after any five consecutive trading day period (the “measurement period”) in which the trading price (as defined in the 2026 Convertible Notes Indenture) per $1,000 principal amount of 2026 Convertible Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company’s common stock and the conversion rate on each such trading day; ● during any period after the Company has issued notice of redemption until the close of business on the scheduled trading day immediately preceding the relevant redemption date; or ● upon the occurrence of specified corporate events. On or after March 15, 2026, until the close of business on the business day immediately preceding the maturity date, holders may convert their 2026 Convertible Notes at any time, regardless of the foregoing circumstances. Upon conversion, the Company will pay or deliver, as the case may be, cash, shares of the Company’s common stock or any combination thereof at the Company’s election. The conversion rate for the 2026 Convertible Notes was initially, and remains, 19.0404 shares of the Company’s common stock per $1,000 principal amount of the 2026 Convertible Notes, which is equivalent to an initial conversion price of approximately $52.52 per share of the Company’s common stock. The conversion rate may be subject to adjustment in some events but will not be adjusted for any accrued and unpaid interest. The Company is not permitted to redeem the 2026 Convertible Notes prior to September 20, 2023. The Company may redeem for cash all or any portion of the 2026 Convertible Notes, at its option, if the last reported sale price of its common stock has been at least 130% of the conversion price then in effect on the last trading day of, and for at least 19 other trading days (whether or not consecutive) during, any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption, at a redemption price equal to 100% of the principal amount of the 2026 Convertible Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. No sinking fund is provided for the 2026 Convertible Notes, which means that the Company is not required to redeem or retire the 2026 Convertible Notes periodically. If the Company undergoes a “fundamental change” (as defined in the 2026 Convertible Notes Indenture), subject to certain conditions, holders of the 2026 Convertible Notes may require the Company to repurchase for cash all or part of their 2026 Convertible Notes at a repurchase price equal to 100% of the principal amount of the 2026 Convertible Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. The 2026 Convertible Notes represent senior unsecured obligations and will rank senior in right of payment to the Company’s future indebtedness that is expressly subordinated in right of payment to the notes, equal in right of payment to the Company’s existing and future unsecured indebtedness that is not so subordinated, effectively junior in right of payment to any of the Company’s secured indebtedness to the extent of the value of the assets securing such indebtedness, and structurally subordinated to all existing and future indebtedness and other liabilities (including trade payables) incurred by the Company’s subsidiaries. The 2026 Convertible Notes Indenture contains customary events of default with respect to the 2026 Convertible Notes, including that upon certain events of default (including the Company’s failure to make any payment of principal or interest on the 2026 Convertible Notes when due and payable) occurring and continuing, the 2026 Convertible Notes Trustee by notice to the Company, or the holders of at least 25% in principal amount of the outstanding 2026 Convertible Notes by notice to the Company and the Convertible Notes Trustee, may, and the 2026 Convertible Notes Trustee at the request of such holders (subject to the provisions of the 2026 Convertible Notes Indenture) shall, declare 100% of the principal of and accrued and unpaid interest, if any, on all the 2026 Convertible Notes to be due and payable. In case of certain events of bankruptcy, insolvency or reorganization, involving the Company or a significant subsidiary, 100% of the principal of and accrued and unpaid interest on the 2026 Convertible Notes will automatically become due and payable. Upon such a declaration of acceleration, such principal and accrued and unpaid interest, if any, will be due and payable immediately. Prior to the adoption of ASU 2020-06, the Company accounted for the 2026 Convertible Notes as a liability and equity component where the carrying value of the liability component was valued based on a similar instrument. In accounting for the issuance of the 2026 Convertible Notes, the Company separated the 2026 Convertible Notes into liability and equity components. The carrying amount of the liability component was calculated by measuring the fair value of a similar liability that did not have an associated convertible feature. The carrying amount of the equity component representing the conversion option was determined by deducting the fair value of the liability component from the par value of the 2026 Convertible Notes as a whole. The excess of the principal amount of the liability component over its carrying amount, referred to as the debt discount, was amortized to interest expense over the seven-year term of the 2026 Convertible Notes. The equity component was not re-measured as long as it continued to meet the conditions for equity classification. The equity component recorded at issuance related to the 2026 Convertible Notes was $123.0 million and was recorded in additional paid-in capital. In accounting for the transaction costs related to the issuance of the 2026 Convertible Notes, the Company allocated the total costs incurred to the liability and equity components of the 2026 Convertible Notes based on their relative values. Transaction costs attributable to the liability component were amortized to interest expense over the seven-year term of the 2026 Convertible Notes, and transaction costs attributable to the equity component were netted with the equity components in stockholders’ equity. Additionally, the Company initially recorded a net deferred tax liability of $25.3 million in connection with the 2026 Convertible Notes. Effective January 1, 2021 the Company adopted ASU 2020-06. After adoption, the Company now accounts for the 2026 Convertible Notes as a single liability measured at amortized cost. As the equity component is no longer required to be split into a separate component, the Company recorded an adjustment for the initial $123.0 million that was allocated to additional paid in capital and $16.1 million of life to date interest expense recorded as amortization of debt discount. Additionally, the net deferred tax liability recorded for the 2026 Convertible Notes was reversed. The principal amount of the liability over its carrying amount is amortized to interest expense over the seven-year term of the 2026 Convertible Notes. Since the 2026 Convertible Notes are classified as a single liability, there is no debt discount required to be amortized. The 2026 Convertible Notes consist of the following: Liability component June 30, 2022 December 31, 2021 Principal $ 287,500 $ 287,500 Less: Debt issuance costs (5,040) (5,606) Net carrying amount $ 282,460 $ 281,894 As of June 30, 2022, the remaining contractual life of the 2026 Convertible Notes is approximately 4.2 years. The following table sets forth total interest expense recognized related to the 2026 Convertible Notes: Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Contractual interest expense $ 1,066 $ 1,066 $ 2,135 $ 2,135 Amortization of debt issuance costs 284 279 567 556 Total $ 1,350 $ 1,345 $ 2,702 $ 2,691 Effective interest rate of the liability component 1.9 % 1.9 % 1.9 % 1.9 % In April 2022, under the terms of the 2026 Convertible Notes Indenture, the Company paid additional interest on the 2026 Convertible Notes at a rate equal to 0.5% per annum, for a total interest payment of approximately $2.1 million, for the period beginning September 25, 2020 and ending March 14, 2022. This amount is not included in the table above, but was recorded as interest expense, net within the statement of operations for the three and six months ended June 30, 2022. 2022 Convertible Notes In August 2015, the Company issued, at par value, $150.0 million aggregate principal amount of 3.00% convertible senior notes due 2022. The 2022 Convertible Notes bear cash interest at a rate of 3.00% per year, payable semi-annually on February 15 and August 15 of each year, beginning on February 15, 2016. The 2022 Convertible Notes will mature on August 15, 2022, unless earlier repurchased or converted. The net proceeds to the Company from the offering were $145.4 million after deducting the initial purchasers’ discounts and commissions and the offering expenses payable by the Company. The 2022 Convertible Notes are governed by an indenture (the "2022 Convertible Notes Indenture") with U.S Bank National Association as trustee (the "2022 Convertible Notes Trustee"). As of February 15, 2022, until the close of business on the business day immediately preceding the maturity date, holders may convert their 2022 Convertible Notes at any time. Upon conversion, the Company will pay and deliver a combination of cash and shares of the Company’s common stock. The conversion rate for the 2022 Convertible Notes was initially, and remains, 17.7487 shares of the Company’s common stock per $1,000 principal amount of the 2022 Convertible Notes, which is equivalent to an initial conversion price of approximately $56.34 per share of the Company’s common stock. The conversion rate may be subject to adjustment in some events but will not be adjusted for any accrued and unpaid interest. The Company was not permitted to redeem the 2022 Convertible Notes prior to August 20, 2018. As of August 20, 2018, the Company may redeem for cash all or any portion of the 2022 Convertible Notes, at its option, if the last reported sale price of its common stock has been at least 130% of the conversion price then in effect on the last trading day of, and for at least 19 other trading days (whether or not consecutive) during, any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption, at a redemption price equal to 100% of the principal amount of the 2022 Convertible Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. No sinking fund is provided for the 2022 Convertible Notes, which means that the Company is not required to redeem or retire the 2022 Convertible Notes periodically. There have been no redemptions to date. If the Company undergoes a “fundamental change” (as defined in the 2022 Convertible Notes Indenture), subject to certain conditions, holders of the 2022 Convertible Notes may require the Company to repurchase for cash all or part of their 2022 Convertible Notes at a repurchase price equal to 100% of the principal amount of the 2022 Convertible Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. The 2022 Convertible Notes represent senior unsecured obligations and will rank senior in right of payment to the Company’s future indebtedness that is expressly subordinated in right of payment to the notes, equal in right of payment to the Company’s existing and future unsecured indebtedness that is not so subordinated, effectively junior in right of payment to any of the Company’s secured indebtedness to the extent of the value of the assets securing such indebtedness, and structurally subordinated to all existing and future indebtedness and other liabilities (including trade payables) incurred by the Company’s subsidiaries. The 2022 Convertible Notes Indenture contains customary events of default with respect to the 2022 Convertible Notes, including that upon certain events of default (including the Company’s failure to make any payment of principal or interest on the 2022 Convertible Notes when due and payable) occurring and continuing, the 2022 Convertible Notes Trustee by notice to the Company, or the holders of at least 25% in principal amount of the outstanding 2022 Convertible Notes by notice to the Company and the Convertible Notes Trustee, may, and the 2022 Convertible Notes Trustee at the request of such holders (subject to the provisions of the 2022 Convertible Notes Indenture) shall, declare 100% of the principal of and accrued and unpaid interest, if any, on all the 2022 Convertible Notes to be due and payable. In case of certain events of bankruptcy, insolvency or reorganization, involving the Company or a significant subsidiary, 100% of the principal of and accrued and unpaid interest on the 2022 Convertible Notes will automatically become due and payable. Upon such a declaration of acceleration, such principal and accrued and unpaid interest, if any, will be due and payable immediately. Prior to the adoption of ASU 2020-06, the Company accounted for the 2022 Convertible Notes as a liability and equity component where the carrying value of the liability component was valued based on a similar instrument. In accounting for the issuance of the 2022 Convertible Notes, the Company separated the 2022 Convertible Notes into liability and equity components. The carrying amount of the liability component was calculated by measuring the fair value of a similar liability that did not have an associated convertible feature. The carrying amount of the equity component representing the conversion option was determined by deducting the fair value of the liability component from the par value of the 2022 Convertible Notes as a whole. The excess of the principal amount of the liability component over its carrying amount, referred to as the debt discount, was amortized to interest expense over the seven-year term of the 2022 Convertible Notes. The equity component was not re-measured as long as it continued to meet the conditions for equity classification. The equity component recorded at issuance related to the 2022 Convertible Notes was $57.5 million and was recorded in additional paid-in capital. In accounting for the transaction costs related to the issuance of the 2022 Convertible Notes, the Company allocated the total costs incurred to the liability and equity components of the 2022 Convertible Notes based on their relative values. Transaction costs attributable to the liability component were amortized to interest expense over the seven-year term of the 2022 Convertible Notes, and transaction costs attributable to the equity component are netted with the equity components in stockholders’ equity. Additionally, the Company initially recorded a net deferred tax liability of $22.3 million in connection with the 2022 Convertible Notes. Effective January 1, 2021 the Company adopted ASU 2020-06. After adoption, the Company now accounts for the 2022 Convertible Notes as a single liability measured at amortized cost. As the equity component is no longer required to be split into a separate component, the Company recorded an adjustment for the initial $57.5 million that was allocated to additional paid in capital and $38.7 million of life to date interest expense recorded as amortization of debt discount. Additionally, the net deferred tax liability recorded for the 2022 Convertible Notes was reversed. The principal amount of the liability over its carrying amount is amortized to interest expense over the seven-year term of the 2022 Convertible Notes. Since the 2022 Convertible Notes are classified as a single liability, there is no debt discount required to be amortized. The 2022 Convertible Notes consist of the following: Liability component June 30, 2022 December 31, 2021 Principal $ 150,000 $ 150,000 Less: Debt issuance costs (92) (460) Net carrying amount $ 149,908 $ 149,540 As of June 30, 2022, the remaining contractual life of the 2022 Convertible Notes is approximately 0.1 years. The following table sets forth total interest expense recognized related to the 2022 Convertible Notes: Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Contractual interest expense $ 1,131 $ 1,131 $ 2,241 $ 2,241 Amortization of debt issuance costs 186 180 368 355 Total $ 1,317 $ 1,311 $ 2,609 $ 2,596 Effective interest rate of the liability component 3.5 % 3.5 % 3.5 % 3.5 % |
Commitments and contingencies
Commitments and contingencies | 6 Months Ended |
Jun. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | 10. Commitments and contingencies Under various agreements, the Company will be required to pay royalties and milestone payments upon the successful development and commercialization of products. The Company has entered into funding agreements with The Wellcome Trust Limited ("Wellcome Trust") for the research and development of small molecule compounds in connection with the Company’s oncology and antibacterial programs. As the Company has discontinued development under its antibacterial program, it no longer expects that milestone and royalty payments from the Company to Wellcome Trust will apply under that agreement, resulting in a change to the total amount of development and regulatory milestone payments the Company may become obligated to pay for this program. Under the oncology program funding agreement, to the extent that the Company develops and commercializes program intellectual property on a for-profit basis itself or in collaboration with a partner (provided the Company retains overall control of worldwide commercialization), the Company may become obligated to pay to Wellcome Trust development and regulatory milestone payments and single-digit royalties on sales of any research program product. The Company’s obligation to pay such royalties would continue on a country-by-country basis until the longer of the expiration of the last patent in the program intellectual property in such country covering the research program product and the expiration of market exclusivity of such product in such country. The Company made the first development milestone payment of $0.8 million to Wellcome Trust under the oncology platform funding agreement during the second quarter of 2016. Additional milestone payments of up to an aggregate of $22.4 million may become payable by the Company to Wellcome Trust under this agreement. The Company has also entered into a collaboration agreement with the SMA Foundation. The Company is obligated to pay the SMA Foundation single-digit royalties on worldwide net product sales of any collaboration product that is successfully developed and subsequently commercialized or, with respect to collaboration products the Company outlicenses, including Evrysdi, a specified percentage of certain payments the Company receives from its licensee. As of the six months ended June 30, 2022, the SMA Foundation earned $16.2 million, $12.1 million which was paid and $4.1 million which was accrued. The Company’s obligation to make such payments would end upon the Company’s payment to the SMA Foundation of an aggregate of $52.5 million. Pursuant to the asset purchase agreement ("Asset Purchase Agreement") between the Company and Marathon Pharmaceuticals, LLC (now known as Complete Pharma Holdings, LLC) (“Marathon”), Marathon is entitled to receive contingent payments from the Company based on annual net sales of Emflaza up to a specified aggregate maximum amount over the expected commercial life of the asset. In addition, Marathon received a $50.0 million sales-based milestone during the six months ended June 30, 2022. Pursuant to the Agilis Merger Agreement, Agilis equityholders were previously entitled to receive contingent consideration payments from the Company based on (i) the achievement of certain development milestones up to an aggregate maximum amount of $60.0 million, (ii) the achievement of certain regulatory approval milestones together with a milestone payment following the receipt of a priority review voucher up to an aggregate maximum amount of $535.0 million, (iii) the achievement of certain net sales milestones up to an aggregate maximum amount of $150.0 million, and (iv) a percentage of annual net sales for Friedreich ataxia and Angelman syndrome during specified terms, ranging from 2%-6%. The Company was required to pay $40.0 million of the development milestone payments upon the passing of the second anniversary of the closing of the Agilis Merger, regardless of whether the applicable milestones have been achieved. Pursuant to the terms of a Rights Exchange Agreement, by and among the Company, the Rightholders set forth therein, and, for the limited purposes set forth therein, Shareholder Representatives Services LLC, dated as of April 29, 2020 (the “Rights Exchange Agreement”), the former equityholders of Agilis (the “Participating Rightholders”) canceled and forfeited their rights under the Agilis Merger Agreement to receive (i) $174.0 million, in the aggregate, of potential milestone payments based on the achievement of certain regulatory milestones and (ii) $37.6 million, in the aggregate, of $40.0 million in development milestone payments that would have been due upon the passing of the second anniversary of the closing of the Agilis Merger, regardless of whether the milestones are achieved. The Rights Exchange Agreement has no effect on the Agilis Merger Agreement other than to provide for the cancellation and forfeiture of the Participating Rightholders’ rights to receive $211.6 million, in the aggregate, of the milestone payments described above. As a result, all other rights and obligations under the Agilis Merger Agreement remain in effect pursuant to their terms, including the Company’s obligation to pay up to an aggregate maximum amount of $20.0 million upon the achievement of certain development milestones (representing the remaining portion of potential development milestone payments for which rights were not canceled and forfeited pursuant to the Rights Exchange Agreement while excluding the remaining $2.4 million milestone payment that was due and paid upon the passing of the second anniversary of the closing of the Agilis Merger), up to an aggregate maximum amount of $361.0 million upon the achievement of certain regulatory milestones (representing the remaining portion of potential regulatory milestone payments for which rights were not canceled and forfeited pursuant to the Rights Exchange Agreement), up to a maximum aggregate amount of $150.0 million upon the achievement of certain net sales milestones and a percentage of annual net sales for Friedreich ataxia and Angelman syndrome during specified terms, ranging from 2% to 6%, pursuant to the terms of the Agilis Merger Agreement. Subject to the terms and conditions of the BioElectron Asset Acquisition Agreement, BioElectron may become entitled to receive contingent milestone payments of up to $200.0 million (in cash or in shares of the Company’s common stock, as determined by the Company) from the Company based on the achievement of certain regulatory and net sales milestones. Subject to the terms and conditions of the BioElectron Asset Acquisition Agreement, BioElectron may also become entitled to receive contingent payments based on a percentage of net sales of certain products. Subject to the terms and conditions of the Agreement and Plan of Merger, dated as of May 5, 2020 (the “Censa Merger Agreement”) by and among the Company, Hydro Merger Sub, Inc., our wholly owned, indirect subsidiary, and, solely in its capacity as the representative, agent and attorney-in-fact of the securityholders of Censa, Shareholder Representative Services LLC (such merger pursuant thereto, the “Censa Merger”), former Censa securityholders may become entitled to receive contingent payments from the Company based on (i) the achievement of certain development and regulatory milestones up to an aggregate maximum amount of $217.5 million for PTC923’s two most advanced programs and receipt of a priority review voucher from the FDA as set forth in the Censa Merger Agreement, (ii) $109.0 million in development and regulatory milestones for each additional indication of PTC923, (iii) the achievement of certain net sales milestones up to an aggregate maximum amount of $160.0 million, (iv) a percentage of annual net sales during specified terms, ranging from single to low double digits of the applicable net sales threshold amount, and (v) any sublicense fees paid to the Company in consideration of any sublicense of Censa’s intellectual property to commercialize PTC923, on a country-by-country basis, which contingent payment shall equal to a mid-double digit percentage of any such sublicense fees. Pursuant to the Censa Merger Agreement, the Company has the option to pay the initial $30.0 million development milestone, for the completion of enrollment of a Phase 3 clinical trial for PTC923 for PKU, if achieved, in cash or shares of the Company’s common stock. The Company also has the Tegsedi-Waylivra Agreement for the commercialization of Tegsedi and Waylivra, and products containing those compounds in countries in Latin America and the Caribbean. Pursuant to the Tegsedi-Waylivra Agreement, the Company paid Akcea an upfront licensing fee, which included an initial payment of $12.0 million. In 2019, a $6.0 million milestone was paid upon receipt of regulatory approval of Waylivra from the EMA and a $4.0 million milestone was paid upon regulatory approval of Tegsedi from ANVISA, the Brazilian health regulatory authority. In addition, a $4.0 million milestone was paid upon receipt of regulatory approval for Waylivra from ANVISA in August 2021. Akcea is also entitled to receive royalty payments subject to certain terms set forth in the Tegsedi-Waylivra Agreement. The Company has employment agreements with certain employees which require the funding of a specific level of payments, if certain events, such as a change in control or termination without cause, occur. Additionally, the Company has royalty payments associated with Translarna, Emflaza, and Upstaza product net sales, payable quarterly or annually in accordance with the terms of the related agreements. From time to time in the ordinary course of its business, the Company is subject to claims, legal proceedings, and disputes. The Company is not currently aware of any material legal proceedings against it. |
Revenue recognition
Revenue recognition | 6 Months Ended |
Jun. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue recognition | 11. Revenue recognition Net product sales The Company views its operations and manages its business in one operating segment. During the three months ended June 30, 2022 and 2021, net product sales in the United States were $56.8 million and $49.1 million, respectively, consisting solely of Emflaza, and net product sales outside of the United States were $86.9 million and $54.0 million, respectively, consisting of Translarna, Tegsedi, Waylivra, and Upstaza. Upstaza sales commenced during the three months period ended June 30, 2022. Translarna net revenues made up $77.0 million and $52.6 million of the net product sales outside of the United States for the three months ended June 30, 2022 and 2021, respectively. For the three months ended June 30, 2022 and 2021, the Company had a total of two and two distributors, respectively, that each accounted for over 10% of the Company’s net product sales. During the six months ended June 30, 2022 and 2021, net product sales in the United States were $105.4 million and $92.7 million, respectively, consisting solely of Emflaza, and net product sales outside of the United States were $168.1 million and $101.7 million, respectively, consisting of Translarna, Tegsedi, Waylivra, and Upstaza. Upstaza sales commenced during the six months period ended June 30, 2022. Translarna net revenues made up $156.2 million and $99.1 million of the net product sales outside of the United States for the six months ended June 30, 2022 and 2021, respectively. For the six months ended June 30, 2022 and 2021, the Company had a total of two and two distributors, respectively, that each accounted for over 10% of the Company's net product sales. As of June 30, 2022 and December 31, 2021, the Company did not have any contract liabilities or assets. For the three and six months ended June 30, 2022, the Company did not recognize any revenue related to the amounts included in the contract liability balance at the beginning of the period. During the three and six months ended June 30, 2021, the Company recognized $1.9 million and $4.0 million of revenue, respectively, related to the amounts included in the contract liability balance at the beginning of the period. The Company has not made significant changes to the judgments made in applying ASC Topic 606 for the three and six months ended June 30, 2022 and 2021. Remaining performance obligations Remaining performance obligations represent the transaction price for goods the Company has yet to provide. As of June 30, 2022 and December 31, 2021 the Company does not have any remaining performance obligations relating to Translarna net product revenue. Collaboration and Royalty revenue In November 2011, the Company and the SMA Foundation entered into the SMA License Agreement with Roche. Under the terms of the SMA License Agreement, Roche acquired an exclusive worldwide license to the Company’s SMA program. Under the SMA License Agreement, the Company is eligible to receive additional payments from Roche if specified events are achieved with respect to each licensed product, including up to $135.0 million in research and development event milestones, up to $325.0 million in sales milestones upon achievement of specified sales events, and up to double digit royalties on worldwide annual net sales of a commercial product. The SMA program currently has one approved product, Evrysdi, which was approved in August 2020 by the FDA for the treatment of SMA in adults and children two months and older. As of June 30, 2022, the Company does not have any remaining research and development event milestones that can be received. The remaining potential sales milestones that can be received is $300.0 million. For the three months ended June 30, 2022 and 2021, the Company did not recognize collaboration revenue related to the SMA License Agreement. For the six months ended June 30, 2022 and 2021, the Company recognized collaboration revenue related to the SMA License Agreement of $0.0 million and $20.0 million, respectively. The first commercial sale of Evrysdi in the EU was made in March 2021. This event triggered a $20.0 million milestone payment to the Company from Roche for the six months ended June 30, 2021. In addition to research and development and sales milestones, the Company is eligible to receive up to double-digit royalties on worldwide annual net sales of a commercial product under the SMA License Agreement. For the three and six months ended June 30, 2022, the Company has recognized $21.8 million and $40.7 million of royalty revenue, respectively, related to Evrysdi. For the three and six months ended June 30, 2021, the Company has recognized $13.6 million and $20.2 million of royalty revenue, respectively, related to Evrysdi. |
Intangible assets and goodwill
Intangible assets and goodwill | 6 Months Ended |
Jun. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible assets and goodwill | 12. Intangible assets and goodwill Definite-lived intangibles On April 20, 2017, the Company completed its previously announced acquisition of all rights to Emflaza pursuant to the Asset Purchase Agreement, dated March 15, 2017, and amended on April 20, 2017, by and between the Company and Marathon. The assets acquired by the Company in the transaction include intellectual property rights related to Emflaza, inventories of Emflaza, and certain contractual rights related to Emflaza. In accordance with ASU 2017-01, the Company determined that substantially all of the fair value is concentrated in the Emflaza rights intangible asset and as such accounted for the transaction as an asset acquisition under ASC 805-50 and recorded an intangible asset of $148.4 million, which is being amortized to cost of product sales over its expected useful life of approximately seven years on a straight line basis. Marathon is entitled to receive contingent payments from the Company based on annual net sales of Emflaza beginning in 2018, up to a specified aggregate maximum amount over the expected commercial life of the asset. In accordance with the guidance for an asset acquisition, the Company records the milestone payment when it becomes payable to Marathon and increases the cost basis for the Emflaza rights intangible asset. Marathon received a $50.0 million sales-based milestone during the six month period ended June 30, 2022. For the three months ended June 30, 2022 and 2021, total milestone payments of $21.7 million and $17.1 million were recorded, respectively. For the six months ended June 30, 2022 and 2021, total milestone payments of $83.8 million and $26.0 million were recorded, respectively. These payments are being amortized over the remaining useful life of the Emflaza rights asset on a straight line basis. As of June 30, 2022, a milestone payable to Marathon of $24.5 million was recorded on the balance sheet within accounts payable and accrued expenses. Pursuant to the Tegsedi-Waylivra Agreement, in May 2019 the Company made a $6.0 million milestone payment to Akcea upon regulatory approval of Waylivra from the EMA. In December 2019, the Company made a $4.0 million milestone payment to Akcea upon regulatory approval of Tegsedi from ANVISA. Both payments were recorded as intangible assets and are being amortized to cost of product sales over their expected useful life of approximately ten years on a straight line basis. Additionally, in August 2021, the Company made a $4.0 million milestone payment to Akcea upon regulatory approval of Waylivra from ANVISA. In accordance with the guidance for an asset acquisition, the Company recorded the milestone payment when it became payable to Akcea, and it increased the cost basis for the Waylivra intangible asset. This payment is being amortized to cost of product sales over the expected remaining useful life of the Waylivra asset on a straight line basis. Akcea is also entitled to receive royalty payments subject to certain terms set forth in the Tegsedi-Waylivra Agreement related to sales of Waylivra and Tegsedi. In accordance with the guidance for an asset acquisition, the Company will record royalty payments when they become payable to Akcea and increase the cost basis for the Waylivra and Tegsedi intangible assets, respectively. For the three and six months ended June 30, 2022, a royalty payment of $1.6 million and $2.0 million was recorded for Tegsedi, respectively. No royalty payment was recorded for the three and six months ended June 30, 2021. As of June 30, 2022, a royalty payable of $2.1 million was recorded on the balance sheet within accounts payable and accrued expenses. For the three months ended June 30, 2022 and 2021, the Company recognized amortization expense of $26.3 million and $12.8 million, respectively, related to the Emflaza rights, Waylivra, and Tegsedi intangible assets. For the six months ended June 30, 2022 and 2021, the Company recognized amortization expense of $49.8 million and $24.0 million, respectively, related to the Emflaza rights, Waylivra, and Tegsedi intangible assets. The estimated future amortization of the Emflaza rights, Waylivra, and Tegsedi intangible assets is expected to be as follows: As of June 30, 2022 2022 $ 52,733 2023 105,466 2024 18,089 2025 1,700 2026 and thereafter 5,665 Total $ 183,653 The weighted average remaining amortization period of the definite-lived intangibles as of June 30, 2022 is 2.0 years. Indefinite-lived intangibles In connection with the acquisition of the Company’s gene therapy platform from Agilis, the Company acquired rights to Upstaza, for the treatment of AADC deficiency. AADC deficiency is a rare CNS disorder arising from reductions in the enzyme AADC that result from mutations in the dopa decarboxylase gene. The gene therapy platform also includes an asset targeting Friedreich ataxia, a rare and life-shortening neurodegenerative disease caused by a single defect in the FXN gene which causes reduced production of the frataxin protein. Additionally, the gene therapy platform includes two other programs targeting CNS disorders, including Angelman syndrome, a rare, genetic, neurological disorder characterized by severe developmental delays. In accordance with the acquisition method of accounting, the Company allocated the acquisition cost for the Agilis Merger to the underlying assets acquired and liabilities assumed, based upon the estimated fair values of those assets and liabilities at the date of acquisition. The Company classified the fair value of the acquired IPR&D as indefinite lived intangible assets until the successful completion or abandonment of the associated research and development efforts. The value allocated to the indefinite lived intangible assets was $576.5 million. There have been no changes to the balance of the indefinite-lived intangibles since the Agilis Merger. Goodwill As a result of the Agilis Merger on August 23, 2018, the Company recorded $82.3 million of goodwill, which included a measurement period adjustment of $18.0 million recorded during the three month period ended December 31, 2018. This adjustment was related to the finalization of the fair values assigned to the intangible assets and corresponding deferred tax liability, the contingent consideration, and the deferred consideration. As of June 30, 2022, there have been no changes to the balance of goodwill since the date of the Agilis Merger. Accordingly, the goodwill balance as of June 30, 2022 is $82.3 million. |
Subsequent events
Subsequent events | 6 Months Ended |
Jun. 30, 2022 | |
Subsequent Events [Abstract] | |
Subsequent events | 13. Subsequent events In July 2022, the European Commission approved Upstaza for the treatment of AADC deficiency for patients 18 months and older within the EEA. As a result of such approval, the Company is obligated to pay the former equityholders of Agilis $50.0 million in accordance with the terms of the Agilis Merger Agreement. Accordingly, the Company reclassified $50.0 million from contingent consideration payable to accounts payable and accrued expenses as of June 30, 2022. |
Summary of significant accoun_2
Summary of significant accounting policies (Policies) | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation The accompanying financial information as of June 30, 2022 and for the three and six months ended June 30, 2022 and 2021 has been prepared by the Company, without audit, pursuant to the rules and regulations of the SEC. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States ("GAAP") have been condensed or omitted pursuant to such rules and regulations. These interim financial statements should be read in conjunction with the Company’s audited financial statements as of December 31, 2021 and notes thereto included in the 2021 Form 10-K. In the opinion of management, the unaudited financial information as of June 30, 2022 and for the three and six months ended June 30, 2022 and 2021 reflects all adjustments, which are normal recurring adjustments, necessary to present a fair statement of financial position, results of operations, stockholders’ equity, and cash flows. The results of operations for the three and six months ended June 30, 2022 and 2021 are not necessarily indicative of the results to be expected for the year ended December 31, 2022 or for any other interim period or for any other future year. |
Use of estimates | Use of estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Significant estimates in these consolidated financial statements have been made in connection with the calculation of net product sales, royalty revenue, certain accruals related to the Company’s research and development expenses, valuation procedures for liability for sale of future royalties, valuation procedures for convertible notes, fair value of the contingent consideration, and the provision for or benefit from income taxes. Actual results could differ from those estimates. Changes in estimates are reflected in reported results in the period in which they become known. |
Restricted Cash | Restricted cash Restricted cash included in deposits and other assets on the consolidated balance sheet contains an unconditional, irrevocable and transferable letter of credit that was entered into during the twelve-month period ended December 31, 2019 in connection with obligations under a facility lease for the Company’s leased biologics manufacturing facility in Hopewell Township, New Jersey. The amount of the letter of credit is $7.5 million, is to be maintained for a term of not less than five years and has the potential to be reduced to $3.8 million if after five years the Company is not in default of its lease. Restricted cash also contains an unconditional, irrevocable and transferable letter of credit that was entered into during June 2022 in connection with obligations for the Company’s new facility lease in Warren, New Jersey. The amount of the letter of credit is $8.1 million and has the potential to be reduced to $4.1 million if after five years the Company is not in default of its lease. Both amounts are classified within deposits and other assets on the consolidated balance sheet due to the long-term nature of the letter of credit. Restricted cash also includes a bank guarantee of $0.5 million denominated in a foreign currency. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheet that sum to the total of the same amounts shown in the statement of cash flows: End of Beginning of period- period- June 30, December 31, 2022 2021 Cash and cash equivalents $ 158,158 $ 189,718 Restricted cash included in deposits and other assets 16,087 7,500 Total Cash, cash equivalents and restricted cash per statement of cash flows $ 174,245 $ 197,218 |
Marketable securities | Marketable securities The Company’s marketable securities consists of both debt securities and equity investments. The Company considers its investments in debt securities with original maturities of greater than 90 days to be available for sale securities. Securities under this classification are recorded at fair value and unrealized gains and losses within accumulated other comprehensive income. The estimated fair value of the available for sale securities is determined based on quoted market prices or rates for similar instruments. In addition, the cost of debt securities in this category is adjusted for amortization of premium and accretion of discount to maturity. For available for sale debt securities in an unrealized loss position, the Company assesses whether it intends to sell or if it is more likely than not that the Company will be required to sell the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value. If the criteria are not met, the Company evaluates whether the decline in fair value has resulted from a credit loss or other factors. In making this assessment, management considers, among other factors, the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency, and adverse conditions specifically related to the security. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. If the present value of the cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded for the credit loss, limited by the amount that the fair value is less than the amortized costs basis. Any impairment that has not been recorded through an allowance for credit losses is recognized in other comprehensive income. For the three and six months ended June 30, 2022 and 2021, no allowance was recorded for credit losses. Marketable securities that are equity investments are measured at fair value, as it is readily available, and as such are classified as Level 1 assets. Unrealized holding gains and losses for these equity investments are components of other (expense) income, net within the consolidated statement of operations. |
Inventory and cost of product sales | Inventory and cost of product sales Inventory Inventories are stated at the lower of cost and net realizable value with cost determined on a first-in, first-out basis by product. The Company capitalizes inventory costs associated with products following regulatory approval when future commercialization is considered probable and the future economic benefit is expected to be realized. Products which may be used in clinical development programs are included in inventory and charged to research and development expense when the product enters the research and development process and no longer can be used for commercial purposes. Inventory used for marketing efforts are charged to selling, general and administrative expense. Amounts related to clinical development programs and marketing efforts are immaterial. The following table summarizes the components of the Company’s inventory for the periods indicated: June 30, 2022 December 31, 2021 Raw materials $ 1,382 $ 1,418 Work in progress 7,034 7,721 Finished goods 6,588 6,717 Total inventory $ 15,004 $ 15,856 The Company periodically reviews its inventories for excess amounts or obsolescence and writes down obsolete or otherwise unmarketable inventory to its estimated net realizable value. For the three and six months ended June 30, 2022, the Company recorded inventory write-downs of $0.3 million and $0.9 million, respectively, primarily related to product approaching expiration. For the three and six months ended June 30, 2021, the Company recorded inventory write-downs of $0.3 million and $1.7 million, respectively, primarily related to product approaching expiration. Additionally, though the Company’s product is subject to strict quality control and monitoring which it performs throughout the manufacturing processes, certain batches or units of product may not meet quality specifications resulting in a charge to cost of product sales. For the three and six months ended June 30, 2022 and 2021, these amounts were immaterial. Cost of product sales Cost of product sales consists of the cost of inventory sold, manufacturing and supply chain costs, storage costs, amortization of the acquired intangible asset, royalty payments associated with net product sales, and royalty payments to collaborative partners associated with royalty revenues and collaboration revenue related to milestones. Production costs are expensed as cost of product sales when the related products are sold or royalty revenues and collaboration revenue milestones are earned. |
Revenue recognition | Revenue recognition Net product revenue The Company’s net product revenue primarily consists of sales of Translarna in territories outside of the U.S. for the treatment of nmDMD and sales of Emflaza in the U.S. for the treatment of DMD. The Company recognizes revenue when its performance obligations with its customers have been satisfied. The Company’s performance obligations are to provide products based on customer orders from distributors, hospitals, specialty pharmacies or retail pharmacies. The performance obligations are satisfied at a point in time when the Company’s customer obtains control of the product, which is typically upon delivery. The Company invoices its customers after the products have been delivered and invoice payments are generally due within 30 to 90 days of the invoice date. The Company determines the transaction price based on fixed consideration in its contractual agreements. Contract liabilities arise in certain circumstances when consideration is due for goods the Company has yet to provide. As the Company has identified only one distinct performance obligation, the transaction price is allocated entirely to product sales. In determining the transaction price, a significant financing component does not exist since the timing from when the Company delivers product to when the customers pay for the product is typically less than one year. Customers in certain countries pay in advance of product delivery. In those instances, payment and delivery typically occur in the same month. The Company records product sales net of any variable consideration, which includes discounts, allowances, rebates related to Medicaid and other government pricing programs, and distribution fees. The Company uses the expected value or most likely amount method when estimating its variable consideration, unless discount or rebate terms are specified within contracts. The identified variable consideration is recorded as a reduction of revenue at the time revenues from product sales are recognized. These estimates for variable consideration are adjusted to reflect known changes in factors and may impact such estimates in the quarter those changes are known. Revenue recognized does not include amounts of variable consideration that are constrained. For the three months ended June 30, 2022 and 2021, net product sales outside of the United States were $86.9 million and $54.0 million, respectively, consisting of Translarna, Tegsedi, Waylivra, and Upstaza. Upstaza sales commenced during the three months period ended June 30, 2022. Translarna net revenues made up $77.0 million and $52.6 million of the net product sales outside of the United States for the three months ended June 30, 2022 and 2021, respectively. For the three months ended June 30, 2022 and 2021, net product sales in the United States were $56.8 million and $49.1 million, respectively, consisting solely of Emflaza. For the six months ended June 30, 2022 and 2021, net product sales outside of the United States were $168.1 million and $101.7 million, respectively, consisting of Translarna, Tegsedi, Waylivra, and Upstaza. Upstaza sales commenced during the six months period ended June 30, 2022. Translarna net revenues made up $156.2 million and $99.1 million of the net product sales outside of the United States for the six months ended June 30, 2022 and 2021, respectively. For the six months ended June 30, 2022 and 2021, net product sales in the United States were $105.4 million and $92.7 million, respectively, consisting solely of Emflaza. In relation to customer contracts, the Company incurs costs to fulfill a contract but does not incur costs to obtain a contract. These costs to fulfill a contract do not meet the criteria for capitalization and are expensed as incurred. The Company considers any shipping and handling costs that are incurred after the customer has obtained control of the product as a cost to fulfill a promise. Shipping and handling costs associated with finished goods delivered to customers are recorded as a selling expense. Collaboration and royalty revenue The terms of these agreements typically include payments to the Company of one or more of the following: nonrefundable, upfront license fees; milestone payments; research funding and royalties on future product sales. In addition, the Company generates service revenue through agreements that generally provide for fees for research and development services and may include additional payments upon achievement of specified events. At the inception of a collaboration arrangement, the Company needs to first evaluate if the arrangement meets the criteria in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 808 “Collaborative Arrangements” to then determine if ASC Topic 606 is applicable by considering whether the collaborator meets the definition of a customer. If the criteria are met, the Company assesses the promises in the arrangement to identify distinct performance obligations. For licenses of intellectual property, the Company assesses, at contract inception, whether the intellectual property is distinct from other performance obligations identified in the arrangement. If the licensing of intellectual property is determined to be distinct, revenue is recognized for nonrefundable, upfront license fees when the license is transferred to the customer and the customer can use and benefit from the license. If the licensing of intellectual property is determined not to be distinct, then the license will be bundled with other promises in the arrangement into one distinct performance obligation. The Company needs to determine if the bundled performance obligation is satisfied over time or at a point in time. If the Company concludes that the nonrefundable, upfront license fees will be recognized over time, the Company will need to assess the appropriate method of measuring proportional performance. For milestone payments, the Company assesses, at contract inception, whether the development or sales-based milestones are considered probable of being achieved. If it is probable that a significant revenue reversal will occur, the Company will not record revenue until the uncertainty has been resolved. Milestone payments that are contingent upon regulatory approval are not considered probable of being achieved until the applicable regulatory approvals or other external conditions are obtained as such conditions are not within the Company’s control. If it is probable that a significant revenue reversal will not occur, the Company will estimate the milestone payments using the most likely amount method. The Company will re-assess the development and sales-based milestones each reporting period to determine the probability of achievement. The Company recognizes royalties from product sales at the later of when the related sales occur or when the performance obligation to which the royalty has been allocated has been satisfied. If it is probable that a significant revenue reversal will not occur, the Company will estimate the royalty payments using the most likely amount method. The Company recognizes revenue for reimbursements of research and development costs under collaboration agreements as the services are performed. The Company records these reimbursements as revenue and not as a reduction of research and development expenses as the Company has the risks and rewards as the principal in the research and development activities. For the three months ended June 30, 2022 and 2021, the Company did not recognize collaboration revenue related to the SMA License Agreement with Roche. For the six months ended June 30, 2022 and 2021, the Company recognized collaboration revenue related to the SMA License Agreement with Roche of $0.0 million and $20.0 million, respectively. The first commercial sale of Evrysdi in the EU was made in March 2021. This event triggered a $20.0 million milestone payment to the Company from Roche for the six months ended June 30, 2021. For the three and six months ended June 30, 2022, the Company has recognized $21.8 million and $40.7 million of royalty revenue, respectively, related to Evrysdi. For the three and six months ended June 30, 2021, the Company has recognized $13.6 million and $20.2 million of royalty revenue, respectively, related to Evrysdi. |
Allowance for doubtful accounts | Allowance for doubtful accounts The Company maintains an allowance for estimated losses resulting from the inability of its customers to make required payments. The Company estimates uncollectible amounts based upon current customer receivable balances, the age of customer receivable balances, the customer’s financial condition and current economic trends. The Company also assesses whether an allowance for expected credit losses may be required which includes a review of the Company’s receivables portfolio, which are pooled on a customer basis or country basis. In making its assessment of whether an allowance for credit losses is required, the Company considers its historical experience with customers, current balances, levels of delinquency, regulatory and legal environments, and other relevant current and future forecasted economic conditions. For the three and six months ended June 30, 2022 and 2021, no allowance was recorded for credit losses. The allowance for doubtful accounts was $0.1 million as of June 30, 2022 and $0.1 million as of December 31, 2021. Bad debt expense was immaterial for the three and six months ended June 30, 2022 and 2021. |
Liability for sale of future royalties | Liability for sale of future royalties On July 17, 2020, the Company, RPI, and, for the limited purposes set forth in the agreement, Royalty Pharma PLC, entered into the Royalty Purchase Agreement. Pursuant to the Royalty Purchase Agreement, the Company sold to RPI 42.933% (the “Assigned Royalty Payment”) of the Company’s right to receive sales-based royalty payments (the “Royalty”) on worldwide net sales of Evrysdi and any other product developed pursuant to the SMA License Agreement. In consideration for the sale of the Assigned Royalty Payments, RPI paid the Company $650.0 million in cash consideration. The Company has retained a 57.067% interest in the Royalty and all economic rights to receive the remaining potential regulatory and sales milestone payments under the SMA License Agreement, which milestone payments equal $300.0 million in the aggregate as of June 30, 2022. The Royalty Purchase Agreement will terminate 60 days following the earlier of the date on which Roche is no longer obligated to make any payments of the Royalty pursuant to the SMA License Agreement and the date on which RPI has received $1.3 billion in respect of the Assigned Royalty Payments. The cash consideration obtained pursuant to the Royalty Purchase Agreement is classified as debt and is recorded as “liability for sale of future royalties-current” and “liability for sale of future royalties-noncurrent” on the Company’s consolidated balance sheet based on the timing of the expected payments to be made to RPI. The fair value for the liability for sale of future royalties at the time of the transaction was based on the Company’s estimates of future royalties expected to be paid to RPI over the life of the arrangement, which was determined using forecasts from market data sources, which are considered Level 3 inputs. The liability is being amortized using the effective interest method over the life of the arrangement, in accordance with the respective guidance. The Company utilizes the prospective method to account for subsequent changes in the estimated future payments to be made to RPI. Refer to Note 9 for further details. |
Indefinite-lived intangible assets | Indefinite-lived intangible assets Indefinite-lived intangible assets consist of in process research and development ("IPR&D"). IPR&D acquired directly in a transaction other than a business combination is capitalized if the projects will be further developed or have an alternative future use; otherwise they are expensed. The fair values of IPR&D projects and license agreement assets acquired in business combinations are capitalized. Several methods may be used to determine the estimated fair value of the IPR&D and license agreement asset acquired in a business combination. The Company utilizes the "income method” and uses estimated future net cash flows that are derived from projected sales revenues and estimated costs. These projections are based on factors such as relevant market size, patent protection, and expected pricing and industry trends. The estimated future net cash flows are then discounted to the present value using an appropriate discount rate. These assets are treated as indefinite-lived intangible assets until completion or abandonment of the projects, at which time the assets are amortized over the remaining useful life or written off, as appropriate. Intangible assets with indefinite lives, including IPR&D, are tested for impairment if impairment indicators arise and, at a minimum, annually. However, an entity is permitted to first assess qualitative factors to determine if a quantitative impairment test is necessary. Further testing is only required if the entity determines, based on the qualitative assessment, that it is more likely than not that an indefinite-lived intangible asset’s fair value is less than its carrying amount. Otherwise, no further impairment testing is required. The indefinite-lived intangible asset impairment test consists of a one-step analysis that compares the fair value of the intangible asset with its carrying amount. If the carrying amount of an intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess. The Company considers many factors in evaluating whether the value of its intangible assets with indefinite lives may not be recoverable, including, but not limited to, expected growth rates, the cost of equity and debt capital, general economic conditions, the Company’s outlook and market performance of the Company’s industry and recent and forecasted financial performance. |
Goodwill | Goodwill Goodwill represents the amount of consideration paid in excess of the fair value of net assets acquired as a result of the Company’s business acquisitions accounted for using the acquisition method of accounting. Goodwill is not amortized and is subject to impairment testing at a reporting unit level on an annual basis or when a triggering event occurs that may indicate the carrying value of the goodwill is impaired. The Company reassess its reporting units as part of its annual segment review. An entity is permitted to first assess qualitative factors to determine if a quantitative impairment test is necessary. Further testing is only required if the entity determines, based on the qualitative assessment, that it is more likely than not that the fair value of the reporting unit is less than its carrying amount. |
Income Taxes | Income Taxes On March 27, 2020, the United States enacted the Coronavirus Aid, Relief, and Economic Security Act, referred to herein as the CARES Act, as a response to the economic uncertainty resulting from a strain of novel coronavirus, COVID-19. The CARES Act includes modifications for net operating loss carryovers and carrybacks, limitations of business interest expense for tax, immediate refund of alternative minimum tax (“AMT”) credit carryovers as well as a technical correction to the 2017 Tax Cuts and Jobs Act ("the 2017 Tax Act") for qualified improvement property. On December 27, 2020, the Coronavirus Response and Relief Supplemental Appropriations Act of 2021 – a $900 billion relief package to deliver the second round of economic stimulus for individuals, families, and businesses was signed into law. The bill provides relief through multiple measures and expands many of the provisions already put into place under the CARES Act. As of June 30, 2022, the Company expects that these provisions will not have a material impact. Tax provisions of the CARES Act also include the deferral of certain payroll taxes, relief for retaining employees, and other provisions. The relief for retaining employees was not material to the financial statements and the deferral of certain payroll taxes amounted to $1.3 million as of June 30, 2022, which is accrued in other current liabilities on the consolidated balance sheet. Additionally, the Organization for Economic Co-operation and Development (“OECD”), the European Community (“the EC”), and individual taxing jurisdictions where the Company and its affiliates do business have recently focused on issues related to the taxation of multinational corporations. The OECD has released its comprehensive plan to create an agreed set of international rules for fighting base erosion and profit shifting. In addition, the OECD, the EC and individual taxing jurisdictions are examining changes to how taxing rights should be allocated among countries considering the digital economy. As a result, the tax laws in the U.S. and other countries in which the Company and its affiliates do business could change on a prospective or retroactive basis and any such changes could materially adversely affect the Company’s business. On December 22, 2017, the U.S. government enacted the 2017 Tax Act, which significantly revised U.S. tax law by, among other provisions, lowering the U.S. federal statutory corporate income tax rate to 21%, imposing a mandatory one-time transition tax on previously deferred foreign earnings, and eliminating or reducing certain income tax deductions. The Global Intangible Low-Taxed Income ("GILTI") provisions of the 2017 Tax Act require the Company to include in its U.S. income tax return foreign subsidiary earnings in excess of an allowable return on the foreign subsidiary’s tangible assets. The Company has elected to account for GILTI tax in the period in which it is incurred, and therefore has not provided any deferred tax impacts of GILTI in its consolidated financial statements for the period ended June 30, 2022. Starting in 2022, TCJA amendments to IRC Section 174 will no longer permit an immediate deduction for research and development (R&D) expenditures in the tax year that such costs are incurred. Instead, these IRC Section 174 development costs must now be capitalized and amortized over either a five- or 15-year period, depending on the location of the activities performed. The new amortization period begins with the midpoint of any taxable year that IRC Section 174 costs are first incurred, regardless of whether the expenditures were made prior to or after July 1, and runs until the midpoint of year five for activities conducted in the United States or year 15 in the case of development conducted on foreign soil. As a result of this tax law change, the Company recorded a federal tax provision for the six months ended June 30, 2022, in the amount of $1.6 million. Also, as a result of this tax law change, the Company recorded a state tax provision for the three months ended June 30, 2022, in the amount of $5.4 million. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and net operating loss and credit carryforwards. Deferred tax assets and liabilities are measured at rates expected to apply to taxable income in the years in which those temporary differences and carryforwards are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the statement of operations in the period that includes the enactment date. A valuation allowance is recorded when it is not more likely than not that all or a portion of the net deferred tax assets will be realized. On August 23, 2018, the Company completed its acquisition of Agilis Biotherapeutics, Inc. (“Agilis”), pursuant to an Agreement and Plan of Merger, dated as of July 19, 2018 (the “Agilis Merger Agreement”), by and among the Company, Agility Merger Sub, Inc., a Delaware corporation and the Company’s wholly owned, indirect subsidiary, Agilis and, solely in its capacity as the representative, agent and attorney-in-fact of the equityholders of Agilis, Shareholder Representative Services LLC, (the “Agilis Merger”). The Company recorded a deferred tax liability in conjunction with the Agilis Merger of $122.0 million in 2018, related to the tax basis difference in the IPRD indefinite-lived intangibles acquired. The Company’s policy is to record a deferred tax liability related to acquired IPR&D which may eventually be realized either upon amortization of the asset when the research is completed and a product is successfully launched or the write-off of the asset if it is abandoned or unsuccessful. |
Leases | Leases The Company determines if an arrangement is a lease at inception. This determination generally depends on whether the arrangement conveys to the Company the right to control the use of an explicitly or implicitly identified fixed asset for a period of time in exchange for consideration. Control of an underlying asset is conveyed to the Company if the Company obtains the rights to direct the use of and to obtain substantially all of the economic benefits from using the underlying asset. The Company has lease agreements which include lease and non-lease components, which the Company accounts for as a single lease component for all leases. Operating and finance leases are classified as right of use ("ROU") assets, short term lease liabilities, and long term lease liabilities. Operating and finance lease ROU assets and lease liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. ROU assets are amortized and lease liabilities accrete to yield straight-line expense over the term of the lease. Lease payments included in the measurement of the lease liability are comprised of fixed payments. Variable lease payments associated with the Company’s leases are recognized when the event, activity, or circumstance in the lease agreement on which those payments are assessed occurs. Variable lease payments are presented in the Company’s consolidated statements of operations in the same line item as expense arising from fixed lease payments for operating leases. Leases with an initial term of 12 months or less are not recorded on the consolidated balance sheet and the Company recognizes lease expense for these leases on a straight-line basis over the lease term. The Company applies this policy to all underlying asset categories. A lessee is required to discount its unpaid lease payments using the interest rate implicit in the lease or, if that rate cannot be readily determined, its incremental borrowing rate. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The Company gives consideration to its recent debt issuances as well as publicly available data for instruments with similar characteristics when calculating its incremental borrowing rates. The lease term for all of the Company’s leases includes the non-cancellable period of the lease plus any additional periods covered by either a Company option to extend (or not to terminate) the lease that the Company is reasonably certain to exercise, or an option to extend (or not to terminate) the lease controlled by the lessor. Leasehold improvements are capitalized and depreciated over the lesser of useful life or lease term. See Note 3 Leases for additional information. |
Summary of significant accoun_3
Summary of significant accounting policies (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Reconciliation of cash | End of Beginning of period- period- June 30, December 31, 2022 2021 Cash and cash equivalents $ 158,158 $ 189,718 Restricted cash included in deposits and other assets 16,087 7,500 Total Cash, cash equivalents and restricted cash per statement of cash flows $ 174,245 $ 197,218 |
Schedule of Inventory | June 30, 2022 December 31, 2021 Raw materials $ 1,382 $ 1,418 Work in progress 7,034 7,721 Finished goods 6,588 6,717 Total inventory $ 15,004 $ 15,856 |
Leases - (Tables)
Leases - (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Leases | |
Schedule of lease costs | Three Months Ended Three Months Ended Six Months Ended Six Months Ended June 30, 2022 June 30, 2021 June 30, 2022 June 30, 2021 Operating Lease Cost Fixed lease cost $ 4,764 $ 4,115 $ 8,890 $ 8,219 Variable lease cost 923 993 2,001 2,087 Short-term lease cost 257 119 338 283 Total operating lease cost $ 5,944 $ 5,227 $ 11,229 $ 10,589 June 30, 2022 December 31, 2021 Weighted-average remaining lease terms - operating leases (years) 13.03 10.87 Weighted-average discount rate - operating leases 8.70 % 8.91 % Weighted-average remaining lease terms - finance lease (years) 10.50 11.00 Weighted-average discount rate - finance lease 7.80 % 7.80 % |
Schedule of supplemental cash flow information related to leases | Six Months Ended June 30, 2022 2021 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 7,089 $ 6,816 Financing cash flows from finance lease 1,276 2,224 Operating cash flows from finance leases 1,724 776 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 68,642 $ 13 |
Schedule of future lease payments - Operating leases | Operating Leases Finance Lease 2022 (excludes the six months ended June 30, 2022) $ 7,665 $ — 2023 10,185 3,000 2024 18,251 3,000 2025 20,425 3,000 2026 and thereafter 213,775 21,000 Total lease payments 270,301 30,000 Less: Imputed Interest expense 124,050 9,947 Total $ 146,251 $ 20,053 |
Schedule of future lease payments - Finance leases | Operating Leases Finance Lease 2022 (excludes the six months ended June 30, 2022) $ 7,665 $ — 2023 10,185 3,000 2024 18,251 3,000 2025 20,425 3,000 2026 and thereafter 213,775 21,000 Total lease payments 270,301 30,000 Less: Imputed Interest expense 124,050 9,947 Total $ 146,251 $ 20,053 |
Fair value of financial instr_2
Fair value of financial instruments and marketable securities - (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of financial assets and liabilities that are required to be measured at fair value on a recurring basis | June 30, 2022 Quoted prices Significant in active other Significant markets for observable unobservable identical assets inputs inputs Total (level 1) (level 2) (level 3) Marketable securities - available for sale $ 154,973 $ — $ 154,973 $ — Marketable securities - equity investments $ 192,414 $ 192,414 $ — $ — ClearPoint Equity Investments $ 16,894 $ 16,894 $ — $ — ClearPoint convertible debt security $ 22,966 $ — $ 22,966 $ — Contingent consideration payable- development and regulatory milestones $ 78,700 $ — $ — $ 78,700 Contingent consideration payable- net sales milestones and royalties $ 84,300 $ — $ — $ 84,300 December 31, 2021 Quoted prices Significant in active other Significant markets for observable unobservable identical assets inputs inputs Total (level 1) (level 2) (level 3) Marketable securities - available for sale $ 376,685 $ — $ 376,685 $ — Marketable securities - equity investments $ 206,973 $ 206,973 $ — $ — ClearPoint Equity Investments $ 14,525 $ 14,525 $ — $ — ClearPoint convertible debt security $ 20,971 $ — $ 20,971 $ — Contingent consideration payable- development and regulatory milestones $ 139,300 $ — $ — $ 139,300 Contingent consideration payable- net sales milestones and royalties $ 100,600 $ — $ — $ 100,600 |
Summary of marketable securities accounted for as available-for-sale debt securities | June 30, 2022 Amortized Gross Unrealized Cost Gains Losses Fair Value Corporate debt securities 152,771 — (3,483) 149,288 Government obligations 5,873 — (188) 5,685 Total $ 158,644 $ — $ (3,671) $ 154,973 December 31, 2021 Amortized Gross Unrealized Cost Gains Losses Fair Value Commercial paper $ 75,275 5 (1) $ 75,279 Corporate debt securities 268,246 81 (644) 267,683 Asset-backed securities 15,287 16 (5) 15,298 Government obligations 18,479 5 (59) 18,425 Total $ 377,287 $ 107 $ (709) $ 376,685 |
Summary of unrealized losses and fair values of available-for-sale debt securities in a continuous unrealized loss position | June 30, 2022 Securities in an unrealized loss Securities in an unrealized loss position less than 12 months position greater than or equal to 12 months Total Unrealized losses Fair Value Unrealized losses Fair Value Unrealized losses Fair Value Corporate debt securities (3,173) 133,542 (310) 10,745 (3,483) 144,287 Government obligations (188) 5,686 — — (188) 5,686 Total $ (3,361) $ 139,228 $ (310) $ 10,745 $ (3,671) $ 149,973 December 31, 2021 Securities in an unrealized loss Securities in an unrealized loss position less than 12 months position greater than or equal to 12 months Total Unrealized losses Fair Value Unrealized losses Fair Value Unrealized losses Fair Value Commercial paper $ (1) 12,992 — — (1) 12,992 Corporate debt securities (608) 217,540 (36) 4,985 (644) 222,525 Asset-backed securities (5) 10,786 — — (5) 10,786 Government obligations (59) 15,483 — — (59) 15,483 Total $ (673) $ 256,801 $ (36) $ 4,985 $ (709) $ 261,786 |
Schedule of marketable securities on the balance sheet | June 30, 2022 Less Than More Than 12 Months 12 Months Corporate debt securities 86,892 62,396 Government obligations — 5,685 Total $ 86,892 $ 68,081 December 31, 2021 Less Than More Than 12 Months 12 Months Commercial paper $ 75,279 $ — Corporate debt securities 131,606 136,077 Asset-backed securities 8,724 6,574 Government obligations 6,002 12,423 Total $ 221,611 $ 155,074 |
Summary of changes in the fair value of the Company's Level 3 valuation for contingent consideration payable | Level 3 liabilities Contingent consideration payable- Contingent consideration payable- development and regulatory net sales milestones and royalties milestones Beginning balance as of December 31, 2021 $ 139,300 $ 100,600 Additions — — Change in fair value (10,600) (16,300) Reclass to accounts payable and accrued expenses (50,000) — Payments — — Ending balance as of June 30, 2022 $ 78,700 $ 84,300 Level 3 liabilities Contingent consideration payable- Contingent consideration payable- development and regulatory net sales milestones and royalties milestones Beginning balance as of December 31, 2020 $ 139,200 $ 101,200 Additions — — Change in fair value 400 400 Payments — — Ending balance as of June 30, 2021 $ 139,600 $ 101,600 |
Fair Value Measurement Inputs and Valuation Techniques | June 30, 2022 Fair Value Valuation Technique Unobservable Input Range Contingent consideration payable- $78,700 Probability-adjusted discounted cash flow Potential development and regulatory milestones $0 - $331 million Contingent considerable payable- net sales $84,300 Option-pricing model with Monte Carlo simulation Potential net sales milestones $0 - $150 million December 31, 2021 Fair Value Valuation Technique Unobservable Input Range Contingent consideration payable- $139,300 Probability-adjusted discounted cash flow Potential development and regulatory milestones $0 - $381 million Contingent considerable payable- net sales $100,600 Option-pricing model with Monte Carlo simulation Potential net sales milestones $0 - $150 million |
Accounts payable and accrued _2
Accounts payable and accrued expenses - (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Payables and Accruals [Abstract] | |
Schedule of components of accounts payable and accrued expenses | June 30, December 31, 2022 2021 Employee compensation, benefits, and related accruals $ 35,834 $ 55,733 Income tax payable 7,582 1,287 Consulting and contracted research 30,866 26,434 Professional fees 5,196 3,547 Sales allowance 64,335 61,662 Sales rebates 71,776 68,770 Royalties 34,230 35,679 Accounts payable 22,881 23,033 Milestone payable 50,000 — Other 8,218 12,639 Total $ 330,918 $ 288,784 |
Net loss per share - (Tables)
Net loss per share - (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of computation of basic and diluted net loss available to common stockholders | Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Numerator Net loss $ (152,087) $ (118,370) $ (278,813) $ (247,012) Denominator Denominator for basic and diluted net loss per share 71,372,940 70,414,632 71,294,458 70,302,241 Net loss per share: Basic and diluted $ (2.13) * $ (1.68) * $ (3.91) * $ (3.51) * * In the three and six months ended June 30, 2022 and 2021, the Company experienced a net loss and therefore did not report any dilutive share impact. |
Schedule of historical dilutive common share equivalents outstanding | As of June 30, 2022 2021 Stock Options 11,815,952 11,031,460 Unvested restricted stock awards and units 2,514,827 1,532,430 Total 14,330,779 12,563,890 |
Stock award plan - (Tables)
Stock award plan - (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Share-based Payment Arrangement [Abstract] | |
Summary of stock option activity | Weighted- Weighted- average Aggregate average remaining intrinsic Number of exercise contractual value(in options price term thousands) Outstanding at December 31, 2021 10,772,582 $ 43.66 Granted 1,471,290 37.86 Exercised (125,020) 25.59 Forfeited/Cancelled (302,900) 49.52 Outstanding at June 30, 2022 11,815,952 $ 42.98 6.79 years $ 52,784 Vested or Expected to vest at June 30, 2022 4,180,409 $ 47.70 8.42 years $ 6,220 Exercisable at June 30, 2022 7,208,199 $ 39.96 5.72 years $ 45,995 |
Schedule of assumptions used to estimate fair values of grants made on the date of grant | Six months ended June 30, 2022 Risk-free interest rate 1.55% - 3.07% Expected volatility 55.33% - 73.56% Expected term 5.5 years |
Summary of information on the Company's restricted stock | Restricted Stock Awards and Units Weighted Average Grant Number of Date Shares Fair Value Unvested at December 31, 2021 1,519,831 $ 55.43 Granted 1,580,362 38.03 Vested (476,223) 50.44 Forfeited (109,143) 47.85 Unvested at June 30, 2022 2,514,827 $ 45.74 |
Schedule of share-based compensation expense recorded in the statement of operations | Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Research and development $ 13,798 $ 13,443 $ 26,832 $ 27,168 Selling, general and administrative 13,932 12,256 27,487 24,238 Total $ 27,730 $ 25,699 $ 54,319 $ 51,406 |
Debt - (Tables)
Debt - (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Debt Instrument, Redemption [Line Items] | |
Summary of liability for sale of future royalties | Six Months Ended June 30, Liability for sale of future royalties- (current and noncurrent) 2022 Beginning balance as of December 31, 2021 $ 733,985 Less: Non-cash royalty revenue payable to RPI (17,482) Plus: Non-cash interest expense recognized 37,825 Ending balance $ 754,328 Effective interest rate as of June 30, 2022 10.1 % |
1.50% Convertible senior notes due 2026 | |
Debt Instrument, Redemption [Line Items] | |
Summary of convertible notes | Liability component June 30, 2022 December 31, 2021 Principal $ 287,500 $ 287,500 Less: Debt issuance costs (5,040) (5,606) Net carrying amount $ 282,460 $ 281,894 |
Summary of interest expense recognized related to the Convertible Notes | Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Contractual interest expense $ 1,066 $ 1,066 $ 2,135 $ 2,135 Amortization of debt issuance costs 284 279 567 556 Total $ 1,350 $ 1,345 $ 2,702 $ 2,691 Effective interest rate of the liability component 1.9 % 1.9 % 1.9 % 1.9 % |
3.00% Convertible senior notes due 2022 | |
Debt Instrument, Redemption [Line Items] | |
Summary of convertible notes | Liability component June 30, 2022 December 31, 2021 Principal $ 150,000 $ 150,000 Less: Debt issuance costs (92) (460) Net carrying amount $ 149,908 $ 149,540 |
Summary of interest expense recognized related to the Convertible Notes | Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Contractual interest expense $ 1,131 $ 1,131 $ 2,241 $ 2,241 Amortization of debt issuance costs 186 180 368 355 Total $ 1,317 $ 1,311 $ 2,609 $ 2,596 Effective interest rate of the liability component 3.5 % 3.5 % 3.5 % 3.5 % |
Intangible assets and goodwill
Intangible assets and goodwill - (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Future amortization expense | As of June 30, 2022 2022 $ 52,733 2023 105,466 2024 18,089 2025 1,700 2026 and thereafter 5,665 Total $ 183,653 |
The Company (Details)
The Company (Details) $ in Thousands | 6 Months Ended | |||
Jun. 30, 2022 USD ($) product | Dec. 31, 2021 USD ($) | Sep. 30, 2019 | Aug. 31, 2015 | |
Long-term debt | ||||
Number of products | product | 2 | |||
Retained earnings (accumulated deficit) | $ | $ (2,376,770) | $ (2,097,957) | ||
Convertible debt | 1.50% Convertible senior notes due 2026 | ||||
Long-term debt | ||||
Interest rate ( as a percent ) | 1.50% | 1.50% | ||
Convertible debt | 3.00% Convertible senior notes due 2022 | ||||
Long-term debt | ||||
Interest rate ( as a percent ) | 3% |
Summary of significant accoun_4
Summary of significant accounting policies - Narrative (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||
Jul. 17, 2020 USD ($) | Dec. 22, 2017 | May 31, 2022 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) segment | Jun. 30, 2021 USD ($) | Dec. 31, 2019 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2018 USD ($) | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||
Number of operating segments | segment | 1 | |||||||||
Allowance for credit loss | $ 0 | $ 0 | $ 0 | $ 0 | ||||||
Increase in allowance for credit losses | 0 | 0 | 0 | 0 | ||||||
Allowance for doubtful accounts receivable | 100 | 100 | $ 100 | |||||||
Revenue | 165,526 | 116,676 | 314,262 | 234,620 | ||||||
Deferred payroll taxes provided for under CARES Act | 1,300 | |||||||||
Cash consideration received from Royalty Purchase Agreement | $ 650,000 | |||||||||
Income taxes | ||||||||||
Federal income tax statutory rate | 21% | |||||||||
Federal income tax provision - IRC Section 174 R&D Expenses | 1,600 | |||||||||
State income tax provision - IRC Section 174 R&D Expenses | 5,400 | |||||||||
Agilis | ||||||||||
Income taxes | ||||||||||
Deferred tax liability | $ 122,000 | |||||||||
Deposits and other assets | ||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||
Bank guarantee | 500 | 500 | ||||||||
Hopewell Campus | ||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||
Period after which letter of credit may be reduced if lease is not in default | 5 years | |||||||||
Hopewell Campus | Minimum | ||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||
Term for letter of credit (in years) | 5 years | |||||||||
Hopewell Campus | Deposits and other assets | ||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||
Letters of credit | $ 7,500 | |||||||||
Hopewell Campus | Fifth Anniversary | ||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||
Letters of credit | $ 3,800 | |||||||||
Warren Premises | ||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||
Period after which letter of credit may be reduced if lease is not in default | 5 years | |||||||||
Warren Premises | Deposits and other assets | ||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||
Letters of credit | $ 8,100 | |||||||||
Warren Premises | Fifth Anniversary | ||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||
Letters of credit | $ 4,100 | |||||||||
Net product revenue | ||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||
Revenue | 143,701 | 103,113 | 273,534 | 194,393 | ||||||
Net product revenue | Non-US | ||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||
Revenue | 86,900 | 54,000 | 168,100 | 101,700 | ||||||
Emflaza | United States | ||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||
Revenue | 56,800 | 49,100 | 105,400 | 92,700 | ||||||
Translarna | Non-US | ||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||
Revenue | $ 77,000 | $ 52,600 | $ 156,200 | $ 99,100 |
Summary of significant accoun_5
Summary of significant accounting policies - Reconciliation of cash (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2020 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 158,158 | $ 189,718 | ||
Restricted cash included in deposits and other assets | 16,087 | 7,500 | ||
Total Cash, cash equivalents and restricted cash per statement of cash flows | $ 174,245 | $ 197,218 | $ 184,847 | $ 216,312 |
Summary of significant accoun_6
Summary of significant accounting policies - Inventory (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Accounting Policies [Abstract] | |||||
Raw materials | $ 1,382 | $ 1,382 | $ 1,418 | ||
Work in progress | 7,034 | 7,034 | 7,721 | ||
Finished goods | 6,588 | 6,588 | 6,717 | ||
Total inventory | 15,004 | 15,004 | $ 15,856 | ||
Inventory write-down | $ 300 | $ 300 | $ 900 | $ 1,700 |
Summary of significant accoun_7
Summary of significant accounting policies - Collaboration and Royalty Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Collaboration and royalty revenue | ||||
Revenue | $ 165,526 | $ 116,676 | $ 314,262 | $ 234,620 |
Collaboration and grant revenue | ||||
Collaboration and royalty revenue | ||||
Revenue | 7 | 20,007 | ||
Royalty revenue | ||||
Collaboration and royalty revenue | ||||
Revenue | 21,825 | 13,563 | 40,721 | 20,220 |
SMA License Agreement | Collaboration and grant revenue | ||||
Collaboration and royalty revenue | ||||
Revenue | 0 | 0 | 0 | 20,000 |
SMA License Agreement | Royalty revenue | ||||
Collaboration and royalty revenue | ||||
Revenue | $ 21,800 | 13,600 | $ 40,700 | 20,200 |
SMA License Agreement | Sales Milestones | ||||
Collaboration and royalty revenue | ||||
Milestone payments received | $ 20,000 | $ 20,000 |
Summary of significant accoun_8
Summary of significant accounting policies - Liability for Sale of Future Royalties (Details) - USD ($) $ in Millions | Jul. 17, 2020 | Jun. 30, 2022 |
Assigned royalty payments | ||
Cash consideration received from Royalty Purchase Agreement | $ 650 | |
Assigned royalty payment, retained percentage | 57.067% | |
Remaining potential milestones that can be achieved | $ 300 | |
Royalty Purchase Agreement | Assigned Royalty Payments | ||
Assigned royalty payments | ||
Assigned royalty payment, percentage | 42.933% | |
Cash consideration received from Royalty Purchase Agreement | $ 650 | |
Royalty purchase agreement, termination period | 60 days | |
Royalty purchase agreement, payment maximum | $ 1,300 |
Leases - Narrative (Details)
Leases - Narrative (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||
Jul. 01, 2020 USD ($) ft² item | Jun. 19, 2020 USD ($) room | May 31, 2022 USD ($) ft² period building | Jun. 30, 2022 USD ($) lease | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) lease | Jun. 30, 2021 USD ($) | Dec. 31, 2020 USD ($) | Dec. 31, 2021 USD ($) | |
Leases | |||||||||
Number of operating leases | lease | 2 | 2 | |||||||
Operating lease, expense | $ 5,900 | $ 5,200 | $ 11,200 | $ 10,600 | |||||
Finance lease liabilities- current | 2,174 | 2,174 | $ 3,000 | ||||||
Finance lease liabilities- noncurrent | 18,675 | 18,675 | 20,053 | ||||||
Aggregate rent, Initial term | 270,301 | 270,301 | |||||||
Operating lease ROU assets | 141,635 | 141,635 | $ 77,421 | ||||||
Operating Lease, Liability | 146,251 | 146,251 | |||||||
Finance Lease, Right-of-Use Asset | 0 | 0 | |||||||
Research and development | 157,263 | 125,482 | 297,341 | 259,995 | |||||
MassBio | |||||||||
Leases | |||||||||
Lessee, Finance Lease, Existence of Option to Terminate [true false] | true | ||||||||
Finance lease cost | $ 400 | $ 400 | $ 800 | $ 800 | |||||
Written notice required for early lease termination | 24 months | ||||||||
Number of dedicated rooms provided for gene therapy AADC program | room | 4 | ||||||||
Guaranteed lease payment due at onset of the lease agreement | $ 15,000 | ||||||||
Guaranteed lease payments due annually | 3,000 | ||||||||
Present value of guaranteed lease payments | $ 41,400 | ||||||||
Finance lease, term of contract | 12 years 6 months | ||||||||
Research and development | $ 41,400 | ||||||||
Minimum | |||||||||
Leases | |||||||||
Operating lease, term of contract | 1 month 6 days | 1 month 6 days | |||||||
Maximum | |||||||||
Leases | |||||||||
Operating lease, term of contract | 16 years 10 months 24 days | 16 years 10 months 24 days | |||||||
Renewal term | 15 years | 15 years | |||||||
Hopewell Campus | |||||||||
Leases | |||||||||
Operating lease, term of contract | 15 years | ||||||||
Area of real estate property | ft² | 220,500 | ||||||||
Renewal term | 10 years | ||||||||
Number of renewable terms | item | 2 | ||||||||
Lessee, Operating Lease, Existence of Option to Extend [true false] | true | ||||||||
Aggregate rent, Initial term | $ 111,500 | ||||||||
Percent of market rate | 95% | ||||||||
Warren Premises | |||||||||
Leases | |||||||||
Operating lease, term of contract | 17 years | ||||||||
Number of buildings leased | building | 2 | ||||||||
Area of real estate property | ft² | 360,000 | ||||||||
Renewal term | 5 years | ||||||||
Number of renewable terms | period | 3 | ||||||||
Lessee, Operating Lease, Existence of Option to Extend [true false] | true | ||||||||
Aggregate rent, Initial term | $ 163,000 | ||||||||
Base rent abatement period | 3 years | ||||||||
Base rent abatement | $ 18,600 | ||||||||
Aggregate rent net of base rate abatement, initial term | 144,400 | ||||||||
Allowance for lease improvements | 36,200 | ||||||||
Commitment to fund construction account | 3,600 | ||||||||
Payment due from lessor at issuance of temporary certificate of occupancy | 5,000 | ||||||||
Operating lease ROU assets | 62,200 | ||||||||
Operating Lease, Liability | $ 62,200 |
Leases - Lease costs (Details)
Leases - Lease costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Leases | ||||
Fixed lease cost | $ 4,764 | $ 4,115 | $ 8,890 | $ 8,219 |
Variable lease cost | 923 | 993 | 2,001 | 2,087 |
Short-term lease cost | 257 | 119 | 338 | 283 |
Total operating lease cost | $ 5,944 | $ 5,227 | $ 11,229 | $ 10,589 |
Leases - Supplemental lease ter
Leases - Supplemental lease terms (Details) | Jun. 30, 2022 | Dec. 31, 2021 |
Leases | ||
Weighted-average remaining lease terms - operating leases (years) | 13 years 10 days | 10 years 10 months 13 days |
Weighted-average discount rate - operating leases | 8.70% | 8.91% |
Weighted-average remaining lease terms - finance lease (years) | 10 years 6 months | 11 years |
Weighted-average discount rate - finance lease | 7.80% | 7.80% |
Leases - Cash flow (Details)
Leases - Cash flow (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Leases | ||
Operating cash flows from operating leases | $ 7,089 | $ 6,816 |
Financing cash flows from finance lease | 1,276 | 2,224 |
Operating cash flows from finance leases | 1,724 | 776 |
Right-of-use assets obtained in exchange for operating lease obligations | $ 68,642 | $ 13 |
Leases - Lease payments (Detail
Leases - Lease payments (Details) $ in Thousands | Jun. 30, 2022 USD ($) |
Operating leases | |
2022 (excludes the six months ended June 30, 2022) | $ 7,665 |
2023 | 10,185 |
2024 | 18,251 |
2025 | 20,425 |
2026 and thereafter | 213,775 |
Total lease payments | 270,301 |
Less: Imputed Interest expense | 124,050 |
Total | 146,251 |
Finance leases | |
2023 | 3,000 |
2024 | 3,000 |
2025 | 3,000 |
2026 and thereafter | 21,000 |
Total lease payments | 30,000 |
Less: Imputed Interest expense | 9,947 |
Total | $ 20,053 |
Fair value of financial instr_3
Fair value of financial instruments and marketable securities - Narrative (Details) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||||||
Aug. 31, 2021 USD ($) | Feb. 28, 2021 USD ($) fund $ / shares | Jan. 31, 2020 USD ($) $ / shares | May 31, 2019 USD ($) $ / shares | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) | Sep. 30, 2019 USD ($) | Aug. 31, 2015 USD ($) | |
Financial assets and liabilities measured at fair value on recurring basis | |||||||||||
Write downs of available for sale debt securities | $ 0 | $ 0 | |||||||||
Realized gain (loss) from sale of marketable securities | (300,000) | $ 0 | (400,000) | $ 700,000 | |||||||
Increase in allowance for credit losses | 0 | 0 | 0 | 0 | |||||||
Purchase of equity investments | 100,000 | ||||||||||
Unrealized gain (loss) on ClearPoint Equity Investment | 2,369,000 | 4,110,000 | |||||||||
Purchase of convertible note | 40,429,000 | 192,931,000 | |||||||||
Unrealized gain (loss) on convertible note | 1,995,000 | 4,326,000 | |||||||||
Purchase of marketable securities - equity investments | $ 10,000,000 | 200,000,000 | |||||||||
Redemption of marketable securities- equity investments | 3,630,000 | ||||||||||
Transfers of assets measured between Level 1, Level 2, and Level 3 | 0 | 0 | $ 0 | ||||||||
Operating Expenses | 257,888,000 | 215,169,000 | 493,144,000 | 431,258,000 | |||||||
Business Combination, Contingent Consideration Arrangements, Change in Amount of Contingent Consideration, Asset | 15,200,000 | (700,000) | 26,900,000 | (800,000) | |||||||
3.00% Convertible senior notes due 2022 | Convertible debt | |||||||||||
Financial assets and liabilities measured at fair value on recurring basis | |||||||||||
Principal | 150,000,000 | 150,000,000 | 150,000,000 | $ 150,000,000 | |||||||
Interest rate ( as a percent ) | 3% | ||||||||||
Fair value of convertible notes | 150,600,000 | 150,600,000 | 158,300,000 | ||||||||
1.50% Convertible senior notes due 2026 | Convertible debt | |||||||||||
Financial assets and liabilities measured at fair value on recurring basis | |||||||||||
Principal | $ 287,500,000 | $ 287,500,000 | 287,500,000 | $ 287,500,000 | |||||||
Interest rate ( as a percent ) | 1.50% | 1.50% | 1.50% | ||||||||
Fair value of convertible notes | $ 300,400,000 | $ 300,400,000 | 305,300,000 | ||||||||
Recurring basis | |||||||||||
Financial assets and liabilities measured at fair value on recurring basis | |||||||||||
Fair value of convertible debt | 22,966,000 | 22,966,000 | 20,971,000 | ||||||||
ClearPoint equity investment | |||||||||||
Financial assets and liabilities measured at fair value on recurring basis | |||||||||||
Purchase of equity investments | $ 100,000 | $ 4,000,000 | |||||||||
Share price (in USD per share) | $ / shares | $ 23.50 | $ 3.10 | |||||||||
Unrealized gain (loss) on ClearPoint Equity Investment | 3,400,000 | (2,700,000) | 2,400,000 | 4,100,000 | |||||||
Marketable securities - equity investments | 16,900,000 | 16,900,000 | 14,500,000 | ||||||||
ClearPoint convertible debt | |||||||||||
Financial assets and liabilities measured at fair value on recurring basis | |||||||||||
Purchase of convertible debt investment | $ 10,000,000 | ||||||||||
Conversion price - convertible note | $ / shares | $ 6 | ||||||||||
Term of convertible note | 5 years | ||||||||||
Unrealized gain (loss) on convertible note | 3,500,000 | (3,500,000) | 2,000,000 | 4,300,000 | |||||||
Fair value of convertible debt | 23,000,000 | 23,000,000 | $ 21,000,000 | ||||||||
Mutual Funds | |||||||||||
Financial assets and liabilities measured at fair value on recurring basis | |||||||||||
Purchase of marketable securities - equity investments | $ 200,000,000 | ||||||||||
Number of mutual funds invested in | fund | 2 | ||||||||||
Redemption of marketable securities- equity investments | 1,200,000 | 0 | 3,600,000 | 0 | |||||||
Unrealized gain on marketable securities - equity investments | 1,000,000 | 700,000 | |||||||||
Unrealized loss on marketable securities - equity investments | 4,900,000 | 11,400,000 | |||||||||
Unrealized foreign currency transaction gain (loss), net | $ (300,000) | $ 0 | $ 400,000 | $ 0 |
Fair value of financial instr_4
Fair value of financial instruments and marketable securities - Hierarchy (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Financial assets and liabilities measured at fair value on recurring basis | ||
Marketable securities - available for sale | $ 154,973 | $ 376,685 |
Contingent consideration payable | 163,000 | 239,900 |
Recurring basis | ||
Financial assets and liabilities measured at fair value on recurring basis | ||
ClearPoint Equity Investments | 16,894 | 14,525 |
ClearPoint convertible debt security | 22,966 | 20,971 |
Recurring basis | Quoted prices in active markets for identical assets (Level 1) | ||
Financial assets and liabilities measured at fair value on recurring basis | ||
ClearPoint Equity Investments | 16,894 | 14,525 |
Recurring basis | Significant other observable inputs (Level 2) | ||
Financial assets and liabilities measured at fair value on recurring basis | ||
ClearPoint convertible debt security | 22,966 | 20,971 |
Recurring basis | Development and Regulatory Milestones | ||
Financial assets and liabilities measured at fair value on recurring basis | ||
Contingent consideration payable | 78,700 | 139,300 |
Recurring basis | Development and Regulatory Milestones | Significant unobservable inputs (Level 3) | ||
Financial assets and liabilities measured at fair value on recurring basis | ||
Contingent consideration payable | 78,700 | 139,300 |
Recurring basis | Net Sales Milestones and Royalties | ||
Financial assets and liabilities measured at fair value on recurring basis | ||
Contingent consideration payable | 84,300 | 100,600 |
Recurring basis | Net Sales Milestones and Royalties | Significant unobservable inputs (Level 3) | ||
Financial assets and liabilities measured at fair value on recurring basis | ||
Contingent consideration payable | 84,300 | 100,600 |
Recurring basis | Marketable securities | ||
Financial assets and liabilities measured at fair value on recurring basis | ||
Marketable securities - available for sale | 154,973 | 376,685 |
Marketable securities - equity investments | 192,414 | 206,973 |
Recurring basis | Marketable securities | Quoted prices in active markets for identical assets (Level 1) | ||
Financial assets and liabilities measured at fair value on recurring basis | ||
Marketable securities - equity investments | 192,414 | 206,973 |
Recurring basis | Marketable securities | Significant other observable inputs (Level 2) | ||
Financial assets and liabilities measured at fair value on recurring basis | ||
Marketable securities - available for sale | $ 154,973 | $ 376,685 |
Fair value of financial instr_5
Fair value of financial instruments and investments - Marketable Securities, Unrealized Gains (Losses) (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | $ 158,644 | $ 377,287 |
Gross Unrealized, Gain | 107 | |
Gross Unrealized, Loss | (3,671) | (709) |
Fair Value | 154,973 | 376,685 |
Commercial paper | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 75,275 | |
Gross Unrealized, Gain | 5 | |
Gross Unrealized, Loss | (1) | |
Fair Value | 75,279 | |
Corporate debt securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 152,771 | 268,246 |
Gross Unrealized, Gain | 0 | 81 |
Gross Unrealized, Loss | (3,483) | (644) |
Fair Value | 149,288 | 267,683 |
Asset-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 15,287 | |
Gross Unrealized, Gain | 16 | |
Gross Unrealized, Loss | (5) | |
Fair Value | 15,298 | |
Government obligations | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 5,873 | 18,479 |
Gross Unrealized, Gain | 5 | |
Gross Unrealized, Loss | (188) | (59) |
Fair Value | $ 5,685 | $ 18,425 |
Fair value of financial instr_6
Fair value of financial instruments and investments - Available-for-sale securities (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Debt Securities, Available-for-sale [Line Items] | ||
Securities in an unrealized loss position less than 12 months - Unrealized losses | $ (3,361) | $ (673) |
Securities in an unrealized loss position less than 12 months - Fair Value | 139,228 | 256,801 |
Securities in an unrealized loss position greater than 12 months - Unrealized losses | (310) | (36) |
Securities in an unrealized loss position greater than 12 months - Fair Value | 10,745 | 4,985 |
Total - Unrealized losses | (3,671) | (709) |
Total - Fair Value | 149,973 | 261,786 |
Commercial paper | ||
Debt Securities, Available-for-sale [Line Items] | ||
Securities in an unrealized loss position less than 12 months - Unrealized losses | (1) | |
Securities in an unrealized loss position less than 12 months - Fair Value | 12,992 | |
Total - Unrealized losses | (1) | |
Total - Fair Value | 12,992 | |
Corporate debt securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Securities in an unrealized loss position less than 12 months - Unrealized losses | (3,173) | (608) |
Securities in an unrealized loss position less than 12 months - Fair Value | 133,542 | 217,540 |
Securities in an unrealized loss position greater than 12 months - Unrealized losses | (310) | (36) |
Securities in an unrealized loss position greater than 12 months - Fair Value | 10,745 | 4,985 |
Total - Unrealized losses | (3,483) | (644) |
Total - Fair Value | 144,287 | 222,525 |
Asset-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Securities in an unrealized loss position less than 12 months - Unrealized losses | (5) | |
Securities in an unrealized loss position less than 12 months - Fair Value | 10,786 | |
Total - Unrealized losses | (5) | |
Total - Fair Value | 10,786 | |
Government obligations | ||
Debt Securities, Available-for-sale [Line Items] | ||
Securities in an unrealized loss position less than 12 months - Unrealized losses | (188) | (59) |
Securities in an unrealized loss position less than 12 months - Fair Value | 5,686 | 15,483 |
Total - Unrealized losses | (188) | (59) |
Total - Fair Value | $ 5,686 | $ 15,483 |
Fair value of financial instr_7
Fair value of financial instruments and investments - Marketable Securities, Balance Sheet Disclosures (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Debt Securities, Available-for-sale [Line Items] | ||
Marketable securities, Less Than 12 Months | $ 86,892 | $ 221,611 |
Marketable securities, More Than 12 Months | 68,081 | 155,074 |
Commercial paper | ||
Debt Securities, Available-for-sale [Line Items] | ||
Marketable securities, Less Than 12 Months | 75,279 | |
Corporate debt securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Marketable securities, Less Than 12 Months | 86,892 | 131,606 |
Marketable securities, More Than 12 Months | 62,396 | 136,077 |
Asset-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Marketable securities, Less Than 12 Months | 8,724 | |
Marketable securities, More Than 12 Months | 6,574 | |
Government obligations | ||
Debt Securities, Available-for-sale [Line Items] | ||
Marketable securities, Less Than 12 Months | 6,002 | |
Marketable securities, More Than 12 Months | $ 5,685 | $ 12,423 |
Fair value of financial instr_8
Fair value of financial instruments and investments - Summary of changes in the fair value of the Company's Level 3 valuation (Details) - Significant unobservable inputs (Level 3) - Agilis - Commitments - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Development and Regulatory Milestones | ||
Changes in the fair value of warrant liability and SARs liability | ||
Beginning Balance | $ 139,300 | $ 139,200 |
Additions | 0 | 0 |
Change in fair value | (10,600) | 400 |
Reclass to accounts payable and accrued expenses | (50,000) | |
Rights Exchange settlement | 0 | 0 |
Ending Balance | 78,700 | 139,600 |
Net Sales Milestones and Royalties | ||
Changes in the fair value of warrant liability and SARs liability | ||
Beginning Balance | 100,600 | 101,200 |
Additions | 0 | 0 |
Change in fair value | (16,300) | 400 |
Reclass to accounts payable and accrued expenses | 0 | |
Rights Exchange settlement | 0 | 0 |
Ending Balance | $ 84,300 | $ 101,600 |
Fair value of financial instr_9
Fair value of financial instruments and investments - Fair Value Liabilities Measured (Details) - Agilis - Commitments $ in Thousands | Jun. 30, 2022 USD ($) | Dec. 31, 2021 USD ($) | Jun. 30, 2021 USD ($) | Dec. 31, 2020 USD ($) |
Development and Regulatory Milestones | Valuation Technique, Discounted Cash Flow | Development and Regulatory Milestone | Minimum | ||||
Fair Value Valuation Inputs | ||||
Potential milestones | $ 0 | $ 0 | ||
Development and Regulatory Milestones | Valuation Technique, Discounted Cash Flow | Development and Regulatory Milestone | Maximum | ||||
Fair Value Valuation Inputs | ||||
Potential milestones | $ 331,000 | $ 381,000 | ||
Development and Regulatory Milestones | Valuation Technique, Discounted Cash Flow | Probability of Success | Minimum | ||||
Fair Value Valuation Inputs | ||||
Rights Exchange Settlement measurement | 0.25 | 0.25 | ||
Development and Regulatory Milestones | Valuation Technique, Discounted Cash Flow | Probability of Success | Maximum | ||||
Fair Value Valuation Inputs | ||||
Rights Exchange Settlement measurement | 0.87 | 0.94 | ||
Development and Regulatory Milestones | Valuation Technique, Discounted Cash Flow | Probability of Success | Weighted Average | ||||
Fair Value Valuation Inputs | ||||
Rights Exchange Settlement measurement | 0.34 | |||
Development and Regulatory Milestones | Valuation Technique, Discounted Cash Flow | Measurement Input, Discount Rate | Minimum | ||||
Fair Value Valuation Inputs | ||||
Rights Exchange Settlement measurement | 0.075 | 0.017 | ||
Development and Regulatory Milestones | Valuation Technique, Discounted Cash Flow | Measurement Input, Discount Rate | Maximum | ||||
Fair Value Valuation Inputs | ||||
Rights Exchange Settlement measurement | 0.087 | 0.047 | ||
Development and Regulatory Milestones | Valuation Technique, Discounted Cash Flow | Measurement Input, Discount Rate | Weighted Average | ||||
Fair Value Valuation Inputs | ||||
Rights Exchange Settlement measurement | 0.085 | |||
Development and Regulatory Milestones | Significant unobservable inputs (Level 3) | ||||
Fair Value Valuation Inputs | ||||
Fair value | $ 78,700 | $ 139,300 | $ 139,600 | $ 139,200 |
Net Sales Milestones and Royalties | Valuation Technique, Option Pricing Model | Sales Milestones | Minimum | ||||
Fair Value Valuation Inputs | ||||
Potential milestones | 0 | 0 | ||
Net Sales Milestones and Royalties | Valuation Technique, Option Pricing Model | Sales Milestones | Maximum | ||||
Fair Value Valuation Inputs | ||||
Potential milestones | $ 150,000 | $ 150,000 | ||
Net Sales Milestones and Royalties | Valuation Technique, Option Pricing Model | Probability of Success | Minimum | ||||
Fair Value Valuation Inputs | ||||
Rights Exchange Settlement measurement | 0.25 | 0.25 | ||
Net Sales Milestones and Royalties | Valuation Technique, Option Pricing Model | Probability of Success | Maximum | ||||
Fair Value Valuation Inputs | ||||
Rights Exchange Settlement measurement | 0.99 | 0.94 | ||
Net Sales Milestones and Royalties | Valuation Technique, Option Pricing Model | Probability of Success | Weighted Average | ||||
Fair Value Valuation Inputs | ||||
Rights Exchange Settlement measurement | 0.49 | |||
Net Sales Milestones and Royalties | Valuation Technique, Option Pricing Model | Percentage of Sales for Royalties | Minimum | ||||
Fair Value Valuation Inputs | ||||
Rights Exchange Settlement measurement | 0.02 | 0.02 | ||
Net Sales Milestones and Royalties | Valuation Technique, Option Pricing Model | Percentage of Sales for Royalties | Maximum | ||||
Fair Value Valuation Inputs | ||||
Rights Exchange Settlement measurement | 0.06 | 0.06 | ||
Net Sales Milestones and Royalties | Valuation Technique, Option Pricing Model | Measurement Input, Discount Rate | ||||
Fair Value Valuation Inputs | ||||
Rights Exchange Settlement measurement | 0.120 | 0.110 | ||
Net Sales Milestones and Royalties | Valuation Technique, Option Pricing Model | Measurement Input, Discount Rate | Weighted Average | ||||
Fair Value Valuation Inputs | ||||
Rights Exchange Settlement measurement | 0.120 | |||
Net Sales Milestones and Royalties | Significant unobservable inputs (Level 3) | ||||
Fair Value Valuation Inputs | ||||
Fair value | $ 84,300 | $ 100,600 | $ 101,600 | $ 101,200 |
Accounts payable and accrued _3
Accounts payable and accrued expenses - Narrative (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Payables and Accruals [Abstract] | ||
Employee compensation, benefits, and related accruals | $ 35,834 | $ 55,733 |
Income tax payable | 7,582 | 1,287 |
Consulting and contracted research | 30,866 | 26,434 |
Professional fees | 5,196 | 3,547 |
Sales allowance | 64,335 | 61,662 |
Sales rebates | 71,776 | 68,770 |
Royalties | 34,230 | 35,679 |
Accounts payable | 22,881 | 23,033 |
Milestone payable | 50,000 | |
Other | 8,218 | 12,639 |
Accounts payable and accrued expenses | $ 330,918 | $ 288,784 |
Capitalization - Narrative (Det
Capitalization - Narrative (Details) - Sales Agreement - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Aug. 31, 2019 | |
Common stock | |||||
Number of shares issued in transaction (in shares) | 0 | 0 | 0 | 0 | |
Maximum | |||||
Common stock | |||||
Value of shares available to be issued and sold in transaction | $ 125 | ||||
Aggregate value of remaining shares to be issued and sold | $ 93 |
Net loss per share - Numerator
Net loss per share - Numerator and Denominator (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Numerator | ||||
Net loss - Basic | $ (152,087) | $ (118,370) | $ (278,813) | $ (247,012) |
Net loss - Diluted | $ (186,962) | $ (118,370) | $ (313,688) | $ (247,012) |
Denominator | ||||
Basic | 71,372,940 | 70,414,632 | 71,294,458 | 70,302,241 |
Diluted | 71,372,940 | 70,414,632 | 71,294,458 | 70,302,241 |
Net loss per share: | ||||
Basic | $ (2.13) | $ (1.68) | $ (3.91) | $ (3.51) |
Diluted | $ (2.62) | $ (1.68) | $ (4.40) | $ (3.51) |
Net loss per share - Antidiluti
Net loss per share - Antidilutive (Details) - shares | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Net loss per share | ||
Total shares excluded from calculation (in shares) | 14,330,779 | 12,563,890 |
Stock Options | ||
Net loss per share | ||
Total shares excluded from calculation (in shares) | 11,815,952 | 11,031,460 |
Unvested restricted stock awards and units | ||
Net loss per share | ||
Total shares excluded from calculation (in shares) | 2,514,827 | 1,532,430 |
Stock award plan - Narrative (D
Stock award plan - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||||
Jun. 08, 2022 | Dec. 31, 2020 | Jun. 30, 2016 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Apr. 30, 2022 | May 31, 2021 | Jan. 31, 2020 | |
Stock option plan | ||||||||||
Share-based compensation expense | $ 27,730 | $ 25,699 | $ 54,319 | $ 51,406 | ||||||
Unrecognized compensation cost | 227,400 | $ 227,400 | ||||||||
Weighted average remaining service period for recognition of unrecognized compensation cost | 2 years 5 months 19 days | |||||||||
Stock option | ||||||||||
Stock option plan | ||||||||||
Granted (in shares) | 1,471,290 | |||||||||
Expected dividend yield (as a percent) | 0% | |||||||||
Weighted average grant date fair value (in dollars per share) | $ 23.60 | |||||||||
Restricted stock units | ||||||||||
Stock option plan | ||||||||||
Granted (in shares) | 1,580,362 | |||||||||
Employee Stock Purchase Plan | ||||||||||
Stock option plan | ||||||||||
Number of shares authorized (in shares) | 2,000,000 | 2,000,000 | 1,000,000 | |||||||
Award requisite service period | 6 months | |||||||||
Purchase price of common stock, percent | 85% | |||||||||
Employee stock purchase plan, voting percentage limit | 5% | |||||||||
Share-based compensation expense | $ 500 | $ 1,000 | ||||||||
1998 Employee, Director, and Consultant Stock Option Plan, 2009 Equity and Long-term Incentive Plan, and 2013 Stock Incentive Plan | Common stock | ||||||||||
Stock option plan | ||||||||||
Number of shares available for issuance | 0 | 0 | ||||||||
Amended 2013 LTIP | ||||||||||
Stock option plan | ||||||||||
Number of shares available for issuance | 9,306,210 | 9,306,210 | ||||||||
Number of additional shares authorized (in shares) | 8,475,000 | |||||||||
Amended 2013 LTIP | Maximum | ||||||||||
Stock option plan | ||||||||||
Number of shares authorized (in shares) | 16,724,212 | |||||||||
2020 Inducement Stock Incentive Plan | ||||||||||
Stock option plan | ||||||||||
Vesting period | 4 years | |||||||||
2020 Inducement Stock Incentive Plan | Maximum | ||||||||||
Stock option plan | ||||||||||
Expiration period | 10 years | |||||||||
2020 Inducement Stock Incentive Plan | Common stock | ||||||||||
Stock option plan | ||||||||||
Number of shares available for issuance | 46,233 | 46,233 | ||||||||
Number of additional shares authorized (in shares) | 1,000,000 | |||||||||
2020 Inducement Stock Incentive Plan | Common stock | Maximum | ||||||||||
Stock option plan | ||||||||||
Number of shares authorized (in shares) | 1,300,000 | 1,000,000 | ||||||||
2020 Inducement Stock Incentive Plan | Stock option | ||||||||||
Stock option plan | ||||||||||
Stockholder's specified ownership percentage | 10% | 10% | ||||||||
Inducement grants for non-statutory stock options (in shares) | 104,385 | |||||||||
2020 Inducement Stock Incentive Plan | Stock option | Minimum | ||||||||||
Stock option plan | ||||||||||
Stock options granted, exercise price as percentage of the fair market value of common stock at grant date | 100% | 100% | ||||||||
2020 Inducement Stock Incentive Plan | Stock option | Maximum | ||||||||||
Stock option plan | ||||||||||
Stock options granted to stockholder with specified ownership percentage, exercise price as percentage of the fair market value of common stock at grant date | 110% | 110% | ||||||||
2020 Inducement Stock Incentive Plan | Restricted stock units | ||||||||||
Stock option plan | ||||||||||
Granted (in shares) | 43,800 |
Stock award plan - Stock Option
Stock award plan - Stock Option Activity (Details) - Stock option - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended |
Jun. 30, 2022 | |
Number of options | |
Outstanding at the beginning of the period (in shares) | 10,772,582 |
Granted (in shares) | 1,471,290 |
Exercised (in shares) | (125,020) |
Forfeited/Cancelled (in shares) | (302,900) |
Outstanding at the end of the period (in shares) | 11,815,952 |
Vested or Expected to vest at the end of the period (in shares) | 4,180,409 |
Exercisable at the end of the period (in shares) | 7,208,199 |
Weighted- average exercise price | |
Outstanding at the beginning of the period (in dollars per share) | $ 43.66 |
Granted (in dollars per share) | 37.86 |
Exercised (in dollars per share) | 25.59 |
Forfeited/Cancelled (in dollars per share) | 49.52 |
Outstanding at the end of the period (in dollars per share) | 42.98 |
Vested or Expected to vest at the end of the period (in dollars per share) | 47.70 |
Exercisable at the end of the period (in dollars per share) | $ 39.96 |
Weighted- average remaining contractual term | |
Outstanding at the end of the period | 6 years 9 months 14 days |
Vested or Expected to vest at the end of the period | 8 years 5 months 1 day |
Exercisable at the end of the period | 5 years 8 months 19 days |
Aggregate intrinsic value (in thousands) | |
Outstanding at the end of the period (in dollars) | $ 52,784 |
Vested or Expected to vest at the end of the period (in dollars) | 6,220 |
Exercisable at the end of the period (in dollars) | $ 45,995 |
Stock award plan - Assumptions
Stock award plan - Assumptions Used (Details) - Stock option | 6 Months Ended |
Jun. 30, 2022 | |
Valuation assumptions | |
Expected term (in years) | 5 years 6 months |
Minimum | |
Valuation assumptions | |
Risk-free interest rate (as a percent) | 1.55% |
Expected volatility (as a percent) | 55.33% |
Maximum | |
Valuation assumptions | |
Risk-free interest rate (as a percent) | 3.07% |
Expected volatility (as a percent) | 73.56% |
Stock award plan - Restricted S
Stock award plan - Restricted Stock (Details) - Restricted stock awards and units | 6 Months Ended |
Jun. 30, 2022 $ / shares shares | |
Number of Shares | |
Balance at the beginning of the period (in shares) | shares | 1,519,831 |
Granted (in shares) | shares | 1,580,362 |
Vested (in shares) | shares | (476,223) |
Forfeited (in shares) | shares | (109,143) |
Balance at the end of the period (in shares) | shares | 2,514,827 |
Weighted Average Grant Date Fair Value | |
Balance at the beginning of the period (in dollars per share) | $ / shares | $ 55.43 |
Granted (in dollars per share) | $ / shares | 38.03 |
Vested (in dollars per share) | $ / shares | 50.44 |
Forfeited (in dollars per share) | $ / shares | 47.85 |
Balance at the end of the period (in dollars per share) | $ / shares | $ 45.74 |
Stock award plan - Share-based
Stock award plan - Share-based compensation expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Stock option plan | ||||
Share-based compensation expense | $ 27,730 | $ 25,699 | $ 54,319 | $ 51,406 |
Unrecognized compensation cost | 227,400 | $ 227,400 | ||
Weighted average remaining service period for recognition of unrecognized compensation cost | 2 years 5 months 19 days | |||
Research and development | ||||
Stock option plan | ||||
Share-based compensation expense | 13,798 | 13,443 | $ 26,832 | 27,168 |
Selling, general and administrative | ||||
Stock option plan | ||||
Share-based compensation expense | $ 13,932 | $ 12,256 | $ 27,487 | $ 24,238 |
Debt - Liability for Sale of Fu
Debt - Liability for Sale of Future Royalties (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jul. 17, 2020 | Jun. 30, 2022 | |
Debt Disclosure [Abstract] | ||
Proceeds from sale of future royalties | $ 650,000 | |
Beginning balance | $ 733,985 | |
Less: Non-cash royalty revenue payable to RPI | (17,482) | |
Plus: non-cash interest expense recognized | 37,825 | |
Ending balance | $ 754,328 | |
Effective interest rate of the liability component | 11% | 10.10% |
Debt - Narrative (Details)
Debt - Narrative (Details) | 1 Months Ended | 6 Months Ended | 18 Months Ended | ||||
Jan. 01, 2021 USD ($) | Apr. 30, 2022 USD ($) | Sep. 30, 2019 USD ($) D $ / shares | Aug. 31, 2015 USD ($) D $ / shares | Jun. 30, 2022 USD ($) | Mar. 14, 2022 | Dec. 31, 2021 USD ($) | |
Long-term debt | |||||||
Long-term debt | $ 282,460,000 | $ 281,894,000 | |||||
Current portion of long-term debt | 149,908,000 | 149,540,000 | |||||
Additional paid-in capital | 2,184,230,000 | 2,123,606,000 | |||||
1.50% Convertible senior notes due 2026 | |||||||
Long-term debt | |||||||
Term of the convertible notes | 7 years | ||||||
Debt discount to be amortized | $ 0 | ||||||
Incremental interest rate per annum | 0.50% | ||||||
Additional interest paid | $ 2,100,000 | ||||||
3.00% Convertible senior notes due 2022 | |||||||
Long-term debt | |||||||
Term of the convertible notes | 7 years | ||||||
Debt discount to be amortized | $ 0 | ||||||
Convertible debt | 1.50% Convertible senior notes due 2026 | |||||||
Long-term debt | |||||||
Net carrying amount | 282,460,000 | 281,894,000 | |||||
Debt principal amount | $ 287,500,000 | $ 287,500,000 | 287,500,000 | ||||
Debt instrument additional amount available for repurchase | $ 37,500,000 | ||||||
Interest rate ( as a percent ) | 1.50% | 1.50% | |||||
Net proceeds from issuance of convertible notes | $ 279,300,000 | ||||||
Trading days, number | D | 20 | ||||||
Consecutive trading days, period | D | 30 | ||||||
Stock price trigger | 130% | ||||||
Business days, period | 5 days | ||||||
Consecutive trading-day period | 5 days | ||||||
Maximum product of the closing sale price of shares of the Company's common stock and the applicable conversion rate for such trading day | 98% | ||||||
Conversion ratio | 19.0404 | ||||||
Conversion price per share (in dollars per share) | $ / shares | $ 52.52 | ||||||
Convertible instruments principal and unpaid interest payable upon events of default | 100% | ||||||
Minimum percentage of principal held by convertible debt instrument holders required to issue notice for declaration of principal and unpaid interest payable upon events of default | 25% | ||||||
Term of the convertible notes | 7 years | 7 years | 4 years 2 months 12 days | ||||
Equity component of convertible notes, net | $ 123,000,000 | ||||||
Net deferred tax liability in connection with convertible notes | $ 25,300,000 | ||||||
Convertible debt | 1.50% Convertible senior notes due 2026 | Redemption on or after September 20, 2023 | |||||||
Long-term debt | |||||||
Trading days, number | D | 19 | ||||||
Consecutive trading days, period | D | 30 | ||||||
Stock price trigger | 130% | ||||||
Redemption price as percent of principal amount | 100% | ||||||
Sinking fund | $ 0 | ||||||
Convertible debt | 3.00% Convertible senior notes due 2022 | |||||||
Long-term debt | |||||||
Net carrying amount | $ 149,908,000 | 149,540,000 | |||||
Debt principal amount | $ 150,000,000 | $ 150,000,000 | $ 150,000,000 | ||||
Interest rate ( as a percent ) | 3% | ||||||
Net proceeds from issuance of convertible notes | $ 145,400,000 | ||||||
Conversion ratio | 17.7487 | ||||||
Conversion price per share (in dollars per share) | $ / shares | $ 56.34 | ||||||
Convertible instruments principal and unpaid interest payable upon events of default | 100% | ||||||
Minimum percentage of principal held by convertible debt instrument holders required to issue notice for declaration of principal and unpaid interest payable upon events of default | 25% | ||||||
Term of the convertible notes | 7 years | ||||||
Equity component of convertible notes, net | $ 57,500,000 | ||||||
Net deferred tax liability in connection with convertible notes | $ 22,300,000 | ||||||
Remaining contractual life of the convertible notes | 1 month 6 days | ||||||
Convertible debt | 3.00% Convertible senior notes due 2022 | Redemption on or after August 20, 2018 | |||||||
Long-term debt | |||||||
Trading days, number | D | 19 | ||||||
Consecutive trading days, period | D | 30 | ||||||
Stock price trigger | 130% | ||||||
Redemption price as percent of principal amount | 100% | ||||||
Redemptions of convertible notes | $ 0 | ||||||
Sinking fund | $ 0 | ||||||
Cumulative Effect Adjustment | 1.50% Convertible senior notes due 2026 | |||||||
Long-term debt | |||||||
Additional paid-in capital | (123,000,000) | ||||||
Amortization of debt discount | 16,100,000 | ||||||
Cumulative Effect Adjustment | 3.00% Convertible senior notes due 2022 | |||||||
Long-term debt | |||||||
Additional paid-in capital | (57,500,000) | ||||||
Amortization of debt discount | $ 38,700,000 |
Debt - Convertible Notes (Detai
Debt - Convertible Notes (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 | Jan. 01, 2021 | Sep. 30, 2019 | Aug. 31, 2015 |
3.00% Convertible senior notes due 2022 | |||||
Long-term debt | |||||
Less: Debt discount, net | $ 0 | ||||
3.00% Convertible senior notes due 2022 | Convertible debt | |||||
Long-term debt | |||||
Principal | $ 150,000,000 | $ 150,000,000 | $ 150,000,000 | ||
Less: Debt issuance costs | (92,000) | (460,000) | |||
Net carrying amount | 149,908,000 | 149,540,000 | |||
1.50% Convertible senior notes due 2026 | |||||
Long-term debt | |||||
Less: Debt discount, net | $ 0 | ||||
1.50% Convertible senior notes due 2026 | Convertible debt | |||||
Long-term debt | |||||
Principal | 287,500,000 | 287,500,000 | $ 287,500,000 | ||
Less: Debt issuance costs | (5,040,000) | (5,606,000) | |||
Net carrying amount | $ 282,460,000 | $ 281,894,000 |
Debt - Interest Expense (Detail
Debt - Interest Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Jul. 17, 2020 | |
Long-term debt | |||||
Amortization of debt issuance costs | $ 935 | $ 911 | |||
Effective interest rate of the liability component | 10.10% | 10.10% | 11% | ||
Interest expense, net | $ (21,976) | $ (22,559) | $ (45,490) | (41,718) | |
1.50% Convertible senior notes due 2026 | |||||
Long-term debt | |||||
Contractual interest expense | 1,066 | 1,066 | 2,135 | 2,135 | |
Amortization of debt issuance costs | 284 | 279 | 567 | 556 | |
Total | $ 1,350 | $ 1,345 | $ 2,702 | $ 2,691 | |
Effective interest rate of the liability component | 1.90% | 1.90% | 1.90% | 1.90% | |
Convertible debt | 3.00% Convertible senior notes due 2022 | |||||
Long-term debt | |||||
Contractual interest expense | $ 1,131 | $ 1,131 | $ 2,241 | $ 2,241 | |
Amortization of debt issuance costs | 186 | 180 | 368 | 355 | |
Total | $ 1,317 | $ 1,311 | $ 2,609 | $ 2,596 | |
Effective interest rate of the liability component | 3.50% | 3.50% | 3.50% | 3.50% |
Commitments and contingencies -
Commitments and contingencies - Narrative (Details) - USD ($) $ in Thousands | 1 Months Ended | 6 Months Ended | ||||||||
Apr. 29, 2020 | Aug. 31, 2021 | Dec. 31, 2019 | May 31, 2019 | Aug. 31, 2018 | Jun. 30, 2022 | Jul. 31, 2022 | Dec. 31, 2021 | May 29, 2020 | Jun. 30, 2016 | |
Other Commitments | ||||||||||
Accrued royalties | $ 34,230 | $ 35,679 | ||||||||
Akcea | ||||||||||
Other Commitments | ||||||||||
Upfront licensing fee | $ 12,000 | |||||||||
Milestone payments | $ 4,000 | |||||||||
Akcea | Maximum | ||||||||||
Other Commitments | ||||||||||
Milestone payments | $ 4,000 | |||||||||
Censa | ||||||||||
Other Commitments | ||||||||||
Asset acquisition, development and regulatory milestones | $ 109,000 | |||||||||
Asset acquisition, initial milestone | 30,000 | |||||||||
Censa | Maximum | ||||||||||
Other Commitments | ||||||||||
Asset acquisition, milestone, amount | 217,500 | |||||||||
Asset acquisition, net sales milestone | $ 160,000 | |||||||||
Agilis Merger Agreement | Akcea | ||||||||||
Other Commitments | ||||||||||
Milestone payments | $ 4,000 | $ 6,000 | ||||||||
SMA License Agreement | SMA Foundation | ||||||||||
Other Commitments | ||||||||||
Royalty expense | 16,200 | |||||||||
Royalty payments | 12,100 | |||||||||
Accrued royalties | 4,100 | |||||||||
SMA License Agreement | SMA Foundation | Maximum | ||||||||||
Other Commitments | ||||||||||
Potential royalty payments due on net product sales | 52,500 | |||||||||
Agilis | ||||||||||
Other Commitments | ||||||||||
Development milestone payments which the entity is obligated to pay | $ 40,000 | 40,000 | ||||||||
Development milestone obligation payments made | $ 2,400 | |||||||||
Agilis | Minimum | ||||||||||
Other Commitments | ||||||||||
Product sales (as a percent) | 2% | |||||||||
Agilis | Maximum | ||||||||||
Other Commitments | ||||||||||
Development milestone payments which the entity is obligated to pay | $ 60,000 | |||||||||
Priority review voucher amount | 535,000 | |||||||||
Net sales amount | $ 150,000 | |||||||||
Product sales (as a percent) | 6% | |||||||||
Development milestone payment obligations, net of cancellation and forfeiture | $ 20,000 | |||||||||
Contingent liability, milestone, potential achievements, priority review voucher amount, net of cancellation and forfeiture | 361,000 | |||||||||
Agilis | Rights Exchange Agreement | ||||||||||
Other Commitments | ||||||||||
Contingent liability cancellation and forfeiture of potential milestone payments | 174,000 | |||||||||
Development milestone payment obligations, cancellation and forfeiture | 37,600 | |||||||||
Contingent liability, cancellation and forfeiture | $ 211,600 | |||||||||
BioElectron | Maximum | ||||||||||
Other Commitments | ||||||||||
Development milestone payments which the entity is obligated to pay | 200,000 | |||||||||
Marathon | Agilis Merger Agreement | ||||||||||
Other Commitments | ||||||||||
Development milestone payments which the entity is obligated to pay | 50,000 | |||||||||
Net product revenue | Wellcome trust | ||||||||||
Other Commitments | ||||||||||
Development milestone payments which the entity is obligated to pay | $ 800 | |||||||||
Net product revenue | Wellcome trust | Maximum | ||||||||||
Other Commitments | ||||||||||
Development milestone payments which the entity is obligated to pay | $ 22,400 | |||||||||
Subsequent Event [Member] | Agilis | ||||||||||
Other Commitments | ||||||||||
Development milestone payment obligations | $ 50,000 |
Revenue recognition - Net Produ
Revenue recognition - Net Product Sales (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 USD ($) Distributor | Jun. 30, 2021 USD ($) Distributor | Jun. 30, 2022 USD ($) Distributor segment | Jun. 30, 2021 USD ($) Distributor | Dec. 31, 2021 USD ($) | |
Net product sales | |||||
Number of operating segments | segment | 1 | ||||
Revenue | $ 165,526 | $ 116,676 | $ 314,262 | $ 234,620 | |
Number of distributors | Distributor | 2 | 2 | 2 | 2 | |
Contract with customer, liability | $ 0 | $ 0 | $ 0 | ||
Performance obligations satisfied in period | $ 0 | $ 1,900 | $ 0 | $ 4,000 | |
Minimum | |||||
Net product sales | |||||
Percentage of net product sales threshold | 10% | 10% | 10% | 10% | |
Net product revenue | |||||
Net product sales | |||||
Revenue | $ 143,701 | $ 103,113 | $ 273,534 | $ 194,393 | |
Net product revenue | Non-US | |||||
Net product sales | |||||
Revenue | 86,900 | 54,000 | 168,100 | 101,700 | |
Emflaza | United States | |||||
Net product sales | |||||
Revenue | 56,800 | 49,100 | 105,400 | 92,700 | |
Translarna | Non-US | |||||
Net product sales | |||||
Revenue | $ 77,000 | $ 52,600 | $ 156,200 | $ 99,100 |
Revenue recognition - Performan
Revenue recognition - Performance Obligations (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Revenue from Contract with Customer [Abstract] | ||
Remaining performance obligations | $ 0 | $ 0 |
Revenue recognition - Collabora
Revenue recognition - Collaboration and Royalty Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Nov. 30, 2011 | |
Collaboration and royalty revenue | |||||
Remaining potential milestones that can be achieved | $ 300,000 | $ 300,000 | |||
Revenue | 165,526 | $ 116,676 | 314,262 | $ 234,620 | |
Collaboration revenue | |||||
Collaboration and royalty revenue | |||||
Revenue | 7 | 20,007 | |||
Royalty revenue | |||||
Collaboration and royalty revenue | |||||
Revenue | 21,825 | 13,563 | 40,721 | 20,220 | |
SMA License Agreement | Collaboration revenue | |||||
Collaboration and royalty revenue | |||||
Revenue | 0 | 0 | 0 | 20,000 | |
SMA License Agreement | Royalty revenue | |||||
Collaboration and royalty revenue | |||||
Revenue | 21,800 | 13,600 | 40,700 | 20,200 | |
SMA License Agreement | Roche And Sma Foundation | Collaboration revenue | |||||
Collaboration and royalty revenue | |||||
Revenue | 0 | 0 | 0 | 20,000 | |
Research And Development Event Milestones | SMA License Agreement | |||||
Collaboration and royalty revenue | |||||
Remaining potential milestones that can be achieved | 0 | 0 | |||
Milestone payments received | 20,000 | 20,000 | |||
Sales Milestones | SMA License Agreement | |||||
Collaboration and royalty revenue | |||||
Remaining potential milestones that can be achieved | $ 300,000 | $ 300,000 | |||
Milestone payments received | $ 20,000 | $ 20,000 | |||
Maximum | Research And Development Event Milestones | SMA License Agreement | |||||
Collaboration and royalty revenue | |||||
Remaining potential milestones that can be achieved | $ 135,000 | ||||
Maximum | Sales Milestones | SMA License Agreement | |||||
Collaboration and royalty revenue | |||||
Remaining potential milestones that can be achieved | $ 325,000 |
Intangible assets and goodwil_2
Intangible assets and goodwill - Narrative (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 46 Months Ended | ||||||||
Apr. 20, 2017 | Aug. 31, 2021 | Dec. 31, 2019 | May 31, 2019 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2018 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Dec. 31, 2021 | Aug. 23, 2018 | |
Finite-Lived Intangible Assets | ||||||||||||
Milestone payable | $ 50,000 | $ 50,000 | $ 50,000 | |||||||||
Amortization of intangible assets | 26,294 | $ 12,751 | 49,767 | $ 24,028 | ||||||||
Total allocation of IPR&D assets | 576,500 | |||||||||||
Change in indefinite-lived intangibles | 0 | |||||||||||
Accrued royalties | 34,230 | 34,230 | 34,230 | $ 35,679 | ||||||||
Goodwill | 82,341 | 82,341 | 82,341 | $ 82,341 | ||||||||
Changes in goodwill | 0 | |||||||||||
Tegsedi | ||||||||||||
Finite-Lived Intangible Assets | ||||||||||||
Royalty payments | 1,600 | 0 | 2,000 | 0 | ||||||||
Accrued royalties | 2,100 | $ 2,100 | 2,100 | |||||||||
Weighted Average | ||||||||||||
Finite-Lived Intangible Assets | ||||||||||||
Remaining amortization period | 2 years | |||||||||||
Akcea | ||||||||||||
Finite-Lived Intangible Assets | ||||||||||||
Milestone payments | $ 4,000 | |||||||||||
Marathon | ||||||||||||
Finite-Lived Intangible Assets | ||||||||||||
Milestone payments received | 50,000 | $ 50,000 | 50,000 | |||||||||
Agilis | ||||||||||||
Finite-Lived Intangible Assets | ||||||||||||
Goodwill | $ 82,300 | |||||||||||
Goodwill adjustment | $ 18,000 | |||||||||||
Agilis Merger Agreement | Akcea | ||||||||||||
Finite-Lived Intangible Assets | ||||||||||||
Milestone payments | $ 4,000 | $ 6,000 | ||||||||||
Useful life | 10 years | |||||||||||
Emflaza asset acquisition | ||||||||||||
Finite-Lived Intangible Assets | ||||||||||||
Finite-lived intangibles | $ 148,400 | |||||||||||
Milestone obligation payments recorded | 21,700 | $ 17,100 | 83,800 | $ 26,000 | ||||||||
Useful life | 7 years | |||||||||||
Emflaza asset acquisition | Accounts payable and accrued expenses | ||||||||||||
Finite-Lived Intangible Assets | ||||||||||||
Milestone payable | $ 24,500 | $ 24,500 | $ 24,500 |
Intangible assets and goodwil_3
Intangible assets and goodwill - Future Amortization (Details) $ in Thousands | Jun. 30, 2022 USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2022 | $ 52,733 |
2023 | 105,466 |
2024 | 18,089 |
2025 | 1,700 |
2026 and thereafter | 5,665 |
Total | $ 183,653 |
Subsequent events (Details)
Subsequent events (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2022 | Jul. 31, 2022 | |
Subsequent Event [Line Items] | ||
Milestone Payable | $ 50,000 | |
Agilis | ||
Subsequent Event [Line Items] | ||
Reduction in contingent consideration payable | $ 50,000 | |
Subsequent Event | Agilis | ||
Subsequent Event [Line Items] | ||
Development milestone payment obligations | $ 50,000 |