Cover Page
Cover Page - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2023 | Mar. 01, 2024 | |
Cover [Abstract] | ||
Document Type | 10-K | |
Document Annual Report | true | |
Document Period End Date | Dec. 31, 2023 | |
Current Fiscal Year End Date | --12-31 | |
Document Transition Report | false | |
Entity File Number | 001-36112 | |
Entity Registrant Name | MACROGENICS, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 06-1591613 | |
Entity Address, Address Line One | 9704 Medical Center Drive | |
Entity Address, City or Town | Rockville | |
Entity Address, State or Province | MD | |
Entity Address, Postal Zip Code | 20850 | |
City Area Code | 301 | |
Local Phone Number | 251-5172 | |
Title of 12(b) Security | Common Stock, par value $0.01 per share | |
Trading Symbol | MGNX | |
Security Exchange Name | NASDAQ | |
Entity Well-known Seasoned Issuer | Yes | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
ICFR Auditor Attestation Flag | true | |
Entity Shell Company | false | |
Entity Public Float | $ 322.5 | |
Entity Common Stock, Shares Outstanding | 62,432,013 | |
Documents Incorporated by Reference | Portions of MacroGenics, Inc.'s definitive proxy statement for the 2024 annual meeting of stockholders are incorporated by reference into Part III of this Annual Report. | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | FY | |
Entity Central Index Key | 0001125345 | |
Document Financial Statement Error Correction [Flag] | false |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2023 | |
Auditor Information [Abstract] | |
Auditor Firm ID | 42 |
Auditor Name | Ernst & Young LLP |
Auditor Location | Tysons, Virginia |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 100,956 | $ 108,884 |
Marketable securities | 128,849 | 45,462 |
Accounts receivable | 10,367 | 56,222 |
Inventory, net | 1,221 | 1,451 |
Prepaid expenses and other current assets | 9,946 | 10,161 |
Total current assets | 251,339 | 222,180 |
Property, equipment and software, net | 21,847 | 29,575 |
Operating lease, ROU Assets | 23,846 | 27,335 |
Other non current assets | 1,386 | 1,378 |
Total assets | 298,418 | 280,468 |
Current liabilities: | ||
Accounts payable | 6,443 | 4,899 |
Accrued expenses and other current liabilities | 24,239 | 28,998 |
Deferred revenue | 21,651 | 9,988 |
Lease liabilities | 3,775 | 4,726 |
Total current liabilities | 56,108 | 48,611 |
Deferred revenue, net of current portion | 59,243 | 59,480 |
Lease liabilities, net of current portion | 30,196 | 30,106 |
Other non current liabilities | 258 | 258 |
Total liabilities | 145,805 | 138,455 |
Stockholders' equity: | ||
Common stock, 0.01 par value -- 125,000,000 shares authorized, 62,070,627 and 61,701,467 shares outstanding at December 31, 2023 and December 31, 2022, respectively | 621 | 617 |
Additional paid-in capital | 1,254,750 | 1,235,095 |
Accumulated other comprehensive loss | (6) | (5) |
Accumulated deficit | (1,102,752) | (1,093,694) |
Total stockholders' equity | 152,613 | 142,013 |
Total liabilities and stockholders' equity | $ 298,418 | $ 280,468 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 125,000,000 | 125,000,000 |
Common stock, shares outstanding (in shares) | 62,070,627 | 61,701,467 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Revenues: | |||
Revenues | $ 58,749 | $ 151,941 | $ 77,447 |
Costs and expenses: | |||
Cost of product sales | 619 | 3,351 | 2,651 |
Cost of manufacturing services | 7,603 | 4,033 | 0 |
Research and development | 166,583 | 207,026 | 214,577 |
Selling, general and administrative | 52,188 | 58,949 | 63,014 |
Total costs and expenses | 226,993 | 273,359 | 280,242 |
Loss from operations | (168,244) | (121,418) | (202,795) |
Gain on royalty monetization arrangement | 150,930 | 0 | 0 |
Interest and other income | 9,686 | 1,660 | 680 |
Interest expense | (1,430) | 0 | 0 |
Net loss | (9,058) | (119,758) | (202,115) |
Other comprehensive income (loss): | |||
Unrealized gain (loss) on investments | (1) | 56 | (54) |
Comprehensive loss | $ (9,059) | $ (119,702) | $ (202,169) |
Basic and diluted net loss per common share, basic (in dollars per share) | $ (0.15) | $ (1.95) | $ (3.37) |
Basic and diluted net loss per common share, diluted (in dollars per share) | $ (0.15) | $ (1.95) | $ (3.37) |
Basic weighted average number of common shares outstanding (in shares) | 61,929,198 | 61,433,124 | 59,944,717 |
Diluted weighted average number of common shares outstanding (in shares) | 61,929,198 | 61,433,124 | 59,944,717 |
Revenue from collaborative agreements | |||
Revenues: | |||
Revenues | $ 28,990 | $ 119,303 | $ 63,294 |
Revenue from government agreements | |||
Revenues: | |||
Revenues | 1,556 | 1,923 | 1,804 |
Product | |||
Revenues: | |||
Revenues | 17,939 | 16,727 | 12,349 |
Contract Manufacturing | |||
Revenues: | |||
Revenues | 9,833 | 13,988 | 0 |
RevenueFromRoyalityAgreementsMember | |||
Revenues: | |||
Revenues | $ 431 | $ 0 | $ 0 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss |
Balance (in shares) at Dec. 31, 2020 | 56,244,771 | ||||
Balance at Dec. 31, 2020 | $ 295,884 | $ 562 | $ 1,067,150 | $ (771,821) | $ (7) |
Share-based compensation | 23,126 | 23,126 | |||
Issuance of common stock, net of offering costs (in shares) | 4,580,653 | ||||
Issuance of common stock, net of offering costs | 117,818 | $ 46 | 117,772 | ||
Stock plan related activity (in shares) | 482,004 | ||||
Stock plan related activity | 4,959 | $ 5 | 4,954 | ||
Unrealized Gain (Loss) on Investments | (54) | (54) | |||
Net loss | (202,115) | (202,115) | |||
Balance (in shares) at Dec. 31, 2021 | 61,307,428 | ||||
Balance at Dec. 31, 2021 | 239,618 | $ 613 | 1,213,002 | (973,936) | (61) |
Share-based compensation | 20,438 | 20,438 | |||
Issuance of common stock, net of offering costs (in shares) | 160,480 | ||||
Issuance of common stock, net of offering costs | 1,085 | $ 2 | 1,083 | ||
Stock plan related activity (in shares) | 233,559 | ||||
Stock plan related activity | 574 | $ 2 | 572 | ||
Unrealized Gain (Loss) on Investments | 56 | 56 | |||
Net loss | (119,758) | (119,758) | |||
Balance (in shares) at Dec. 31, 2022 | 61,701,467 | ||||
Balance at Dec. 31, 2022 | 142,013 | $ 617 | 1,235,095 | (1,093,694) | (5) |
Share-based compensation | 18,373 | 18,373 | |||
Issuance of common stock, net of offering costs (in shares) | 167,270 | ||||
Issuance of common stock, net of offering costs | 1,039 | $ 2 | 1,037 | ||
Stock plan related activity (in shares) | 201,890 | ||||
Stock plan related activity | 247 | $ 2 | 245 | ||
Unrealized Gain (Loss) on Investments | (1) | (1) | |||
Net loss | (9,058) | (9,058) | |||
Balance (in shares) at Dec. 31, 2023 | 62,070,627 | ||||
Balance at Dec. 31, 2023 | $ 152,613 | $ 621 | $ 1,254,750 | $ (1,102,752) | $ (6) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Operating activities | |||
Net loss | $ (9,058) | $ (119,758) | $ (202,115) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | |||
Depreciation and amortization | 9,645 | 11,865 | 11,258 |
Amortization of premiums and discounts on marketable securities | (5,004) | 403 | 1,607 |
Share-based compensation | 18,373 | 20,438 | 23,126 |
Gain on royalty monetization arrangement | (150,930) | 0 | 0 |
Non-cash interest expense | 1,430 | 0 | 0 |
Non-cash lease expense | 3,489 | 3,341 | 2,690 |
Other non-cash items | 423 | 2,882 | 2,035 |
Loss on disposal of assets | 111 | 0 | 0 |
Changes in operating assets and liabilities: | |||
Accounts receivable | 45,855 | (45,836) | 12,696 |
Inventory | 230 | 55 | (6,424) |
Prepaid expenses and other current assets | 215 | 11,009 | (4,188) |
Other non current assets | (7) | (14,045) | 3,225 |
Accounts payable | 1,281 | (10,860) | 7,125 |
Accrued expenses and other current liabilities | (4,823) | (4,638) | (607) |
Lease liabilities | (861) | 9,364 | (3,780) |
Deferred revenue | 11,426 | 48,821 | 9,264 |
Other non current liabilities | 0 | 0 | 258 |
Net cash used in operating activities | (78,205) | (86,959) | (143,830) |
Cash flows from investing activities | |||
Purchases of marketable securities | (239,683) | (120,602) | (231,208) |
Proceeds from sales and maturities of marketable securities | 161,299 | 194,940 | 200,800 |
Purchases of property, equipment and software | (1,764) | (3,623) | (6,201) |
Proceeds from sales of equipment | 64 | 0 | 0 |
Net cash provided by (used in) investing activities | (80,084) | 70,715 | (36,609) |
Cash flows from financing activities | |||
Proceeds from issuance of common stock, net of offering costs | 616 | 1,085 | 117,818 |
Proceeds from stock option exercises and ESPP purchases | 553 | 574 | 4,959 |
Taxes paid related to net share settlement of equity awards | (306) | 0 | |
Principal payments on royalty monetization arrangement | (157) | 0 | 0 |
Net proceeds from sale of future royalties | 149,655 | 0 | 0 |
Net cash provided by financing activities | 150,361 | 1,659 | 122,777 |
Net change in cash and cash equivalents | (7,928) | (14,585) | (57,662) |
Cash and cash equivalents at beginning of period | 108,884 | 123,469 | 181,131 |
Cash and cash equivalents at end of period | 100,956 | 108,884 | 123,469 |
Non-cash operating and investing activities | |||
Capital Expenditures Incurred but Not yet Paid | $ 505 | $ 118 | $ 508 |
Organization and Nature of Oper
Organization and Nature of Operations | 12 Months Ended |
Dec. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Nature of Operations | Organization and Nature of Operations MacroGenics, Inc. (the Company) is incorporated in the state of Delaware. The Company is a biopharmaceutical company focused on discovering, developing, manufacturing and commercializing innovative antibody-based therapeutics for the treatment of cancer. The Company has a pipeline of product candidates designed to target either various tumor-associated antigens or immune checkpoint molecules. These candidates are being evaluated in clinical trials sponsored by the Company or its collaborators or are in preclinical development. The Company’s clinical product candidates include multiple oncology programs which have either been created using its proprietary, antibody-based technology platforms or enabled through its technology licensing arrangements with other companies. The Company believes its product candidates have the potential, if approved for marketing by regulatory authorities, to have a meaningful effect on treating patients' unmet medical needs as monotherapy or, in some cases, in combination with other therapeutic agents. To date, three products originating from the Company’s pipeline of proprietary or partnered product candidates have received U.S. Food and Drug Administration (FDA) approval. In March 2021, the Company and its commercialization partner commenced U.S. marketing of MARGENZA (margetuximab-cmkb), a human epidermal growth factor receptor 2 (HER2) receptor antagonist indicated, in combination with chemotherapy, for the treatment of adult patients with metastatic HER2-positive breast cancer who have received two or more prior anti-HER2 regimens, at least one of which was for metastatic disease. In November 2022, the FDA approved TZIELD ® (teplizumab-mzwv) to delay the onset of Stage 3 Type 1 Diabetes (T1D) in adult and pediatric patients aged 8 years and older with Stage 2 T1D. Teplizumab was acquired from the Company by Provention Bio, Inc. (Provention) in May 2018, pursuant to an asset purchase agreement. In March 2023, the FDA approved ZYNYZ™ (retifanlimab-dlwr), a humanized monoclonal antibody targeting programmed death receptor-1 (PD-1). Retifanlimab was previously developed by the Company and licensed to Incyte Corporation (Incyte) pursuant to an exclusive global collaboration and license agreement in October 2017. Liquidity The Company’s multiple product candidates currently under development will require significant additional research and development efforts that include extensive preclinical studies and clinical testing, and regulatory approval prior to commercial use. The future success of the Company is dependent on its ability to identify and develop its product candidates, and ultimately upon its ability to attain profitable operations. The Company has devoted substantially all of its financial resources and efforts to research and development and general and administrative expense to support such research and development. Net losses and negative cash flows have had, and will continue to have, an adverse effect on the Company’s stockholders’ equity and working capital, and accordingly, its ability to execute its future operating plans. As a biotechnology company, the Company has primarily funded its operations with proceeds from the sale of its common stock in equity offerings and revenue from its multiple collaboration agreements. Management regularly reviews the Company’s available liquidity relative to its operating budget and forecast to monitor the sufficiency of the Company’s working capital. The Company plans to meet its future operating requirements by generating revenue from current and future strategic collaborations or other arrangements, product sales and royalties. The Company anticipates continuing to draw upon available sources of capital, including equity and debt instruments, to support its product development activities. If the Company is unable to enter into new arrangements or to perform under current or future agreements or obtain additional capital, the Company will assess its capital resources and may be required to delay, reduce the scope of, or eliminate one or more of its product research and development programs or clinical studies, reduce other operating expenses, and/or downsize its organization. Based on the Company’s most recent cash flow forecast, the Company believes its current resources are sufficient to fund its operating plans for a minimum of twelve months from the date that this Annual Report on Form 10-K was filed. Similar to the other risk factors pertinent to the Company's business, including significant equity market volatility and availability of funding in the biotechnology sector, as well as potential issues in the global economy, credit markets and financial markets as a result of significant worldwide events, including adverse events involving financial institutions or the financial services industry, inflation and rising interest rates and geopolitical upheaval, might unfavorably impact the Company's ability to generate such additional funding. Given the uncertainty in the rapidly changing market and economic conditions related to these uncertainties, the Company will continue to evaluate the nature and extent of the impact of these uncertainties on its business and financial position. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, MacroGenics UK Limited and MacroGenics Limited. All intercompany accounts and transactions have been eliminated in consolidation. The Company currently operates in one operating segment. Operating segments are defined as components of an enterprise about which separate discrete information is available for the chief operating decision maker, or decision making group, in deciding how to allocate resources and assessing performance. The Company views its operations and manages its business in one segment, which is developing and commercializing monoclonal antibody-based therapeutics. Use of Estimates The preparation of the financial statements in accordance with generally accepted accounting principles (GAAP) requires the Company to make estimates and judgments in certain circumstances that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. In preparing these consolidated financial statements, management has made its best estimates and judgments of certain amounts included in the financial statements, giving due consideration to materiality. On an ongoing basis, the Company evaluates its estimates, including those related to revenue recognition, fair values of assets, inventory, preclinical study and clinical trial accruals and other contingencies. Management bases its estimates on historical experience or on various other assumptions that it believes to be reasonable under the circumstances. Although actual results could differ from these estimates, management does not believe that such differences would be material. Cash, Cash Equivalents and Marketable Securities The Company considers all investments in highly liquid financial instruments with a maturity of 90 days or less at the date of purchase to be cash equivalents. Cash and cash equivalents includes investments in money market funds with commercial banks and financial institutions, securities issued by the U.S. government and its agencies, Government Sponsored Enterprise agency debt obligations and corporate debt obligations. Cash equivalents are stated at amortized cost, plus accrued interest, which approximates fair value. The Company carries marketable securities classified as available-for-sale at fair value as determined by prices for identical or similar securities at the balance sheet date. Classification of marketable securities between current and non-current is dependent upon the maturity date at the balance sheet date taking into consideration the Company’s ability and intent to hold the investment to maturity. Marketable securities consist of Level 2 financial instruments in the fair-value hierarchy. The Company records unrealized gains and losses as a component of other comprehensive loss within the statements of operations and comprehensive loss and as a separate component of stockholders' equity. Realized gains or losses on available-for-sale securities are determined using the specific identification method and the Company includes net realized gains and losses in other income, along with interest income and amortization of premiums and discounts. Accounts Receivable Accounts receivable arise from product sales, amounts due from the Company’s collaborative partners and contract manufacturing work performed by the Company. The amount from product sales represents amounts due from specialty distributors. Accounts receivable that management has the intent and ability to collect are reported in the consolidated balance sheets at outstanding amounts, less an allowance for doubtful accounts. The Company writes off uncollectible receivables when the likelihood of collection is remote. The Company evaluates the collectability of accounts receivable on a regular basis. The allowance, if any, is based upon various factors including the financial condition and payment history of customers, an overall review of collections experience on other accounts and economic factors or events expected to affect future collections experience. No allowance was recorded as of December 31, 2023 or 2022, as the Company has a history of collecting on all outstanding accounts. Fair Value of Financial Instruments The Company's financial instruments consist of cash and cash equivalents, marketable securities, accounts receivable, accounts payable and accrued expenses. The carrying amount of accounts receivable, accounts payable and accrued expenses are generally considered to be representative of their respective fair values because of their short-term nature. The Company accounts for recurring and non-recurring fair value measurements in accordance with the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 820, Fair Value Measurements and Disclosures (ASC 820). ASC 820 defines fair value, establishes a fair value hierarchy for assets and liabilities measured at fair value, and requires expanded disclosures about fair value measurements. The ASC 820 hierarchy ranks the quality of reliability of inputs, or assumptions, used in the determination of fair value and requires assets and liabilities carried at fair value to be classified and disclosed in one of the following three categories: • Level 1 – Fair value is determined by using unadjusted quoted prices that are available in active markets for identical assets and liabilities. • Level 2 – Fair value is determined by using inputs other than Level 1 quoted prices that are directly or indirectly observable. Inputs can include quoted prices for similar assets and liabilities in active markets or quoted prices for identical assets and liabilities in inactive markets. Related inputs can also include those used in valuation or other pricing models, such as interest rates and yield curves that can be corroborated by observable market data. • Level 3 – Fair value is determined by inputs that are unobservable and not corroborated by market data. Use of these inputs involves significant and subjective judgments to be made by a reporting entity – e.g., determining an appropriate adjustment to a discount factor for illiquidity associated with a given security. The Company evaluates financial assets and liabilities subject to fair value measurements on a recurring basis to determine the appropriate level at which to classify them each reporting period. This determination requires the Company to make subjective judgments as to the significance of inputs used in determining fair value and where such inputs lie within the ASC 820 hierarchy. There were no transfers between levels during the periods presented. Financial assets measured at fair value on a recurring basis were as follows (in thousands): Fair Value Measurement at December 31, 2023 Total Level 1 Level 2 Assets: Money market funds $ 91,665 $ 91,665 $ — U.S Treasury securities 31,179 — 31,179 Government-sponsored enterprises 45,043 — 45,043 Corporate debt securities 52,627 — 52,627 Total assets measured at fair value (a) $ 220,514 $ 91,665 $ 128,849 Fair Value Measurement at December 31, 2022 Total Level 1 Level 2 Assets: Money market funds $ 41,564 $ 41,564 $ — Government-sponsored enterprise 32,811 — 32,811 Corporate debt securities 17,626 — 17,626 Total assets measured at fair value (b) $ 92,001 $ 41,564 $ 50,437 (a) Total assets measured at fair value at December 31, 2023 includes approximately $91.7 million reported as cash and cash equivalents and $128.8 million reported as marketable securities on the balance sheet. (b) Total assets measured at fair value at December 31, 2022 includes approximately $46.5 million reported as cash and cash equivalents and $45.5 million reported as marketable securities on the balance sheet. Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash, cash equivalents, marketable securities and accounts receivable. The Company maintains its cash and money market funds with financial institutions that are federally insured. While balances deposited in these institutions often exceed Federal Deposit Insurance Corporation limits, the Company has not experienced any losses on related accounts to date. The Company's investment policy limits investments to certain types of debt securities issued by the U.S. government, its agencies and institutions with investment-grade credit ratings and places restrictions on maturities and concentration by type and issuer. The counterparties are various corporations, financial institutions and government agencies of high credit standing. The Company's revenue relates to agreements with various collaborators, MARGENZA net product sales and contracts and research grants received from U.S. government agencies. The following table includes those counterparties that represent more than 10% of total revenue earned in the periods indicated: Year Ended December 31, 2023 2022 2021 Incyte 53% 26% 31% McKesson Plasma & Biologics and McKesson Specialty Care Distribution LLC (McKesson) 12% * * ASD Healthcare and Oncology Supply (ASD) 10% * * Provention 10% 43% * Zai Lab Limited (Zai Lab) * 15% 30% I-Mab Biopharma (I-Mab) * * 16% * Amount is less than 10% for the period indicated. The following table includes those counterparties that represent more than 10% of accounts receivable at the date indicated: December 31, 2023 2022 Incyte 25% * Cardinal Health, Inc 18% * McKesson 16% * ASD 15% * Zai Lab 12% * Provention * 84% * Balance is less than 10% as of the date indicated. Inventory When the Company believes regulatory approval is probable and expects future economic benefit from the sales of a product candidate to be realized, the Company capitalizes manufacturing costs (whether internally produced or through third-party contract manufacturing organizations) as inventory. Prior to receiving its first approval from the FDA in December 2020, the Company expensed all costs incurred related to the manufacture of MARGENZA as research and development expense because of the inherent risks associated with the development of a product candidate, the uncertainty about the regulatory approval process and the lack of history for the Company of regulatory approval of drug candidates. Subsequent to FDA approval in December 2020, the Company began capitalizing its MARGENZA third-party contract manufacturing inventory costs. Inventory is composed of raw materials, work-in-process, and finished goods, which are goods that are available for sale. The Company values its inventories at the lower of cost or estimated net realizable value. The Company determines the cost of its inventories, which includes amounts related to materials and third-party contract manufacturing costs, on a first-in, first-out basis. The Company performs an assessment of the recoverability of capitalized inventory during each reporting period, and it writes down any excess, obsolete or unsaleable inventories to their estimated realizable value in the period in which the impairment is first identified. Such write downs, should they occur, are recorded within the cost of product sales in the statement of operations. Property, Equipment and Software Property, equipment and software are stated at cost. Upon retirement or sale, the cost of assets disposed of and the related accumulated depreciation or amortization are removed from the accounts and any resulting gain or loss is credited or charged to operations. Repairs and maintenance costs are expensed as incurred. Depreciation and amortization are computed using the straight-line method over the following estimated useful lives: Computer equipment 3 years Software 3 years Furniture 10 years Laboratory and office equipment 5 years Leasehold improvements Shorter of lease term or useful life Impairment of Long-Lived Assets The Company assesses the recoverability of its long-lived assets in accordance with the provisions of ASC 360, Property, Plant and Equipment (ASC 360). ASC 360 requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of the long-lived asset is measured by a comparison of the carrying amount of the asset to future undiscounted net cash flows expected to be generated by the asset or asset group. If carrying value exceeds the sum of undiscounted cash flows, the Company then determines the fair value of the underlying asset group. Any impairment to be recognized is measured by the amount by which the carrying amount of the asset group exceeds the estimated fair value of the asset group. Assets to be disposed of are reported at the lower of the carrying amount or fair value, less costs to sell. For the years ended December 31, 2023, and 2022, the Company determined that there were no impaired assets. Liability related to the sale of future royalties and related interest expense The Company assesses the relevant accounting criteria under ASC 470, Debt (ASC 470) to determine whether the upfront payment received from the purchaser should be accounted for as debt or deferred income depending on the facts and circumstances. If the criteria in ASC 470 is met, the Company accounts for net proceeds from sales of its rights to receive future royalty payments as a liability that is amortized using the effective interest method over the term of the arrangement. The liability related to future royalties is presented net of unamortized issuance costs on the consolidated balance sheets. Interest expense on the liability related to future royalties is recognized using the effective interest rate method over the life of the arrangement. The Company calculates an effective interest rate which will amortize its related obligation to zero over the anticipated repayment period. The liability related to future royalties and the related interest expense are based on the Company’s current estimates of future royalties expected to be received over the life of the arrangement, which the Company determines by using internal sales projections and external information from market data sources, which are considered Level 3 inputs. The Company periodically assesses the expected payments and to the extent the Company’s estimates of future royalty payments are greater or less than previous estimates or the estimated timing of such payments is materially different than previous estimates, the Company will adjust the effective interest rate and recognize related non-cash interest expense on a prospective basis. Non-cash amortization is reflected as interest expense in the consolidated statements of operations and comprehensive loss. Upon changes in facts and circumstances, for example as a result of a modification to the existing agreements, the Company re-evaluates its rights and obligations and accounts for the change in accordance with the respective accounting guidance. Revenue recognition The Company recognizes revenue under ASC Topic 606, Revenue from Contracts with Customer s (ASC 606) when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of ASC 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Collaborative and other agreements The Company enters into licensing agreements that are within the scope of ASC 606, under which it may license rights to research, develop, manufacture and commercialize its product candidates to third parties. The terms of these arrangements typically include payment to the Company of one or more of the following: non-refundable, upfront license fees; reimbursement of certain costs; customer option exercise fees; development, regulatory and commercial milestone payments; and royalties on net sales of licensed products. The Company may also enter into development and manufacturing service agreements with its collaborators. For each arrangement that results in revenues, the Company identifies all performance obligations, which may include a license to intellectual property and know-how, research and development activities, transition activities and/or manufacturing services. In order to determine the transaction price, in addition to any upfront payment, the Company estimates the amount of variable consideration at the outset of the contract either utilizing the expected value or most likely amount method, depending on the facts and circumstances relative to the contract. The Company constrains (reduces) the estimates of variable consideration such that it is probable that a significant reversal of previously recognized revenue will not occur. When determining if variable consideration should be constrained, management considers whether there are factors outside the Company’s control that could result in a significant reversal of revenue. In making these assessments, the Company considers the likelihood and magnitude of a potential reversal of revenue. These estimates are re-assessed each reporting period as required. Once the estimated transaction price is established, amounts are allocated to the performance obligations that have been identified. The transaction price is generally allocated to each separate performance obligation on a relative standalone selling price basis. The Company must develop assumptions that require judgment to determine the standalone selling price in order to account for these agreements. To determine the standalone selling price, the Company’s assumptions may include (i) the probability of obtaining marketing approval for the product candidate, (ii) estimates regarding the timing and the expected costs to develop and commercialize the product candidate, and (iii) estimates of future cash flows from potential product sales with respect to the product candidate. Standalone selling prices used to perform the initial allocation are not updated after contract inception. The Company does not include a financing component to its estimated transaction price at contract inception unless it estimates that certain performance obligations will not be satisfied within one year. Amounts received prior to revenue recognition are recorded as deferred revenue. Amounts expected to be recognized as revenue within the 12 months following the balance sheet date are classified as current portion of deferred revenue in the accompanying consolidated balance sheets. Amounts not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as deferred revenue, net of current portion. Licenses. When the Company grants a license to its intellectual property, it determines whether the nature of the intellectual property to which the customer will have rights is functional intellectual property (functional IP), which has significant standalone functionality, or symbolic intellectual property (symbolic IP) which does not have significant standalone functionality. Revenue from functional IP is recognized at the point in time when control of the distinct license is transferred to the customer. Revenue from symbolic IP is recognized over the access period to the Company’s intellectual property . If the license to the Company’s intellectual property is determined to be distinct from the other promises or performance obligations identified in the arrangement, the Company recognizes revenue from non-refundable, upfront fees allocated to the license when the license is transferred to the customer and when (or as) the customer is able to use and benefit from the license. In assessing whether a promise or performance obligation is distinct from the other promises, the Company considers factors such as the research, development, manufacturing and commercialization capabilities of the licensee and the availability of the associated expertise in the general marketplace. In addition, the Company considers whether the licensee can benefit from a promise for its intended purpose without the receipt of the remaining promise, whether the value of the promise is dependent on the unsatisfied promise, whether there are other vendors that could provide the remaining promise, and whether it is separately identifiable from the remaining promise. For licenses that are combined with other promises, the Company utilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue. The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. The measure of progress, and thereby periods over which revenue should be recognized, are subject to estimates by management and may change over the course of the research and development and licensing agreement. Such a change could have a material impact on the amount of revenue the Company records in future periods. Research, Development and/or Manufacturing Services. The promises under the Company’s agreements may include research and development or manufacturing services to be performed by the Company on behalf of the counterparty. If these services are determined to be distinct from the other promises or performance obligations identified in the arrangement, the Company recognizes the transaction price allocated to these services as revenue over time based on an appropriate measure of progress when the performance by the Company does not create an asset with an alternative use and the Company has an enforceable right to payment for the performance completed to date. If these services are determined not to be distinct from the other promises or performance obligations identified in the arrangement, the Company recognizes the transaction price allocated to the combined performance obligation as the related performance obligations are satisfied. Customer Options. If an arrangement contains customer options, the Company evaluates whether the options are material rights because they allow the customer to acquire additional goods or services for free or at a discount. If the customer options are determined to represent a material right, the material right is recognized as a separate performance obligation at the outset of the arrangement. The Company allocates the transaction price to material rights based on the relative standalone selling price, which is determined using assumptions regarding estimated costs, discount rates, post-option development timeline, the probability of technical and regulatory success and the probability that the customer will exercise the option. Amounts allocated to a material right are not recognized as revenue until, at the earliest, the option is exercised. If the options are deemed not to be a material right, they are excluded as performance obligations at the outset of the arrangement. Milestone Payments. At the inception of each arrangement that includes development milestone payments, the Company evaluates whether the milestones are considered probable of being achieved and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the control of the Company or the licensee, such as regulatory approvals, are not considered probable of being achieved until those approvals are received. The Company evaluates factors such as the scientific, clinical, regulatory, commercial, and other risks that must be overcome to achieve the particular milestone in making this assessment. There is considerable judgment involved in determining whether it is probable that a significant revenue reversal would not occur. At the end of each subsequent reporting period, the Company reevaluates the probability of achievement of all milestones subject to constraint and, if necessary, adjusts its estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect revenues and earnings in the period of adjustment. Royalties. For arrangements that include sales-based royalties which are the result of a customer-vendor relationship and for which the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied or partially satisfied. The Company analyzes its collaboration arrangements to assess whether such arrangements involve joint operating activities performed by parties who are both active participants in the activities and are both exposed to significant risks and rewards dependent on the commercial success of such activities. Such arrangements generally are within the scope of ASC 808, Collaborative Arrangements (ASC 808). While ASC 808 defines collaborative arrangements and provides guidance on income statement presentation, classification, and disclosures related to such arrangements, it does not address recognition and measurement matters, such as (1) determining the appropriate unit of accounting or (2) when the recognition criteria are met. Therefore, the accounting for these arrangements is either based on an analogy to other accounting literature or an accounting policy election by the Company. The Company accounts for certain components of the collaboration agreement that are reflective of a vendor-customer relationship (e.g., licensing arrangement) based on ASC 606. The Company accounts for other components based on a reasonable, rational and consistently applied accounting policy election. Reimbursements from the counter-party that are the result of a collaborative relationship with the counter-party, instead of a customer relationship, such as co-development activities, are recorded as a reduction to research and development expense as the services are performed. For a complete discussion of accounting for revenue from collaborative and other agreements, see Note 9, Revenue. Product sales, net The Company entered into a limited number of arrangements with specialty distributors in the United States to distribute MARGENZA. These arrangements are considered to be contracts with customers and are in the scope of ASC 606. The Company has written contracts with each of its customers that have a single performance obligation - to deliver products upon receipt of a customer order - and these obligations are satisfied when delivery occurs and the customer receives the product. The specialty distributors subsequently resell the Company’s product to healthcare providers. Product revenue is recorded net of applicable reserves for variable consideration, including discounts and other allowances. Shipping and handling costs for product shipments occur prior to the customer obtaining control of the goods and are recorded in cost of sales. Reserves for Variable Consideration. Revenue from product sales is recorded at the net sales price, which includes estimates of variable consideration. Components of variable consideration typically include discounts, product returns, provider chargebacks and discounts and government rebates. Variable consideration is estimated following the expected value method in accordance with ASC 606 and includes such factors as current contractual and statutory requirements, specific known market events and trends, industry data, and forecasted customer buying and payment patterns. The amount of variable consideration that is included in the transaction price may be constrained and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized under the contract will not occur in a future period. Customer Discounts and Service Fees. The Company may provide customers with discounts which are explicitly stated in the contracts. These discounts are recorded as a reduction of revenue in the period the related product revenue is recognized. In addition, these contracts may include written service arrangements whereby the Company pays fees to customers who provide services such as sales order management, data, contract administration and distribution services, at rates which the Company believes to be consistent with fair market value. The Company has determined such services received to date are not distinct from the Company’s sale of products to its customers and, therefore, these payments have been recorded as a reduction of revenue within the statement of operations. Product Returns. Consistent with industry practice, the Company offers the specialty distributors product return rights pursuant to written contracts and/or Company returned goods policies. The Company estimates the amount of its product sales that may be returned by its customers and records an estimated liability and a reduction of revenue in the period the related product revenue is recognized. The Company currently estimates product returns using industry benchmarking as well as other information available, such as visibility into the inventory remaining in the distribution channel, since the Company does not have its own returns experience. The Company's estimates of product returns may be adjusted in the future based on actual returns experience, known or expected changes in the marketplace, or other factors. Provider Chargebacks and Discounts. Chargebacks for fees and discounts to healthcare providers represent the estimated obligations resulting from contractual commitments to sell products to qualified healthcare providers at prices lower than the list prices charged to customers who directly purchase the product from the Company. In such cases, customers charge the Company for the difference between what they pay for the product and the ultimate selling price to the qualified healthcare providers. The reserve for chargebacks is established in the same period that the related revenue is recognized, resulting in a reduction of product revenue. Chargeback amounts are generally determined at the time of resale to the qualified healthcare provider by customers, and the Company generally issues credits for such amounts within a few weeks of the customer’s notification to the Company of the resale. Chargebacks consist of credits the Company expects to issue for units that remain in the distribution channel at each reporting period end that the Company expects will be sold to qualified healthcare providers and chargebacks that customers have claimed, but for which the Company has not yet issued a credit. Government Rebates. The Company is subject to discount and/or rebate obligations under state Medicaid programs, Medicare and contractual agreements with and statutory obligations to certain Federal and State entities. These reserves are recorded in the same period the related revenue is recognized, resulting in a reduction of product revenue. The Company’s liability for these rebates consists of invoices received for claims from prior quarters that have not been paid or for which an invoice has not yet been received, estimates of claims for the current quarter, and estimates of future claims that will be made for product that has been recognized as revenue, but which remains in the distribution channel at the end of each reporting period. Customer discounts are recorded as a reduction of accounts receivable on the consolidated balance sheets. Allowance for product returns, provider chargebacks, government and other rebates and service fees are recorded as a component of ac |
Marketable Securities
Marketable Securities | 12 Months Ended |
Dec. 31, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Marketable Securities | Marketable Securities Available-for-sale marketable securities as of December 31, 2023 and 2022 were as follows (in thousands): December 31, 2023 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value U.S. Treasury securities $ 31,177 $ 4 $ (2) $ 31,179 Government-sponsored enterprises 45,041 7 (5) 45,043 Corporate debt securities 52,637 5 (15) 52,627 Total $ 128,855 $ 16 $ (22) $ 128,849 December 31, 2022 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Government-sponsored enterprises $ 32,812 $ 5 $ (7) $ 32,810 Corporate debt securities 12,655 1 (4) 12,652 Total $ 45,467 $ 6 $ (11) $ 45,462 All of the Company's available-for-sale securities held at December 31, 2023 and 2022 had contractual maturities of less than one year. All of the Company’s available-for-sale marketable debt securities in an unrealized loss position as of December 31, 2023 and 2022 were in a loss position for less than twelve months. Unrealized losses on available-for-sale debt securities as of December 31, 2023 and 2022 were not significant and were primarily due to changes in interest rates, including market credit spreads, and not due to increased credit risks associated with specific securities. Accordingly, no allowance for credit losses related to the Company's available-for-sale debt securities was recorded for the years ended December 31, 2023 and 2022. The Company does not intend to sell these 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 bases, which may be at maturity. The Company recorded interest income of $4.0 million, $1.7 million and $2.0 million during the years ended December 31, 2023, 2022 and 2021, respectively, which is included in interest and other income on the consolidated statements of operations and comprehensive loss. |
Inventory
Inventory | 12 Months Ended |
Dec. 31, 2023 | |
Inventory Disclosure [Abstract] | |
Inventory, Net | Inventory, Net All of the Company's inventory relates to the manufacturing of MARGENZA. The following table sets forth the Company's inventory, net of reserves (in thousands): December 31, 2023 2022 Work in process $ 261 $ 409 Finished goods 960 1,042 Total inventory, net $ 1,221 $ 1,451 Prior to FDA approval of MARGENZA in December 2020, the cost of materials and expenses associated with the manufacturing of MARGENZA were recorded as research and development expense. Subsequent to FDA approval, the Company began capitalizing inventory costs related to the manufacture of MARGENZA. The inventory balance as of December 31, 2023 and December 31, 2022 is net of a reserve of $3.1 million and $4.9 million, respectively, for unsaleable inventory. These reserves are reflected in cost of product sales during the period they are recorded. Inventory Reserves (in thousands) Balance at Beginning of Year Additions Charged to Expenses Deductions Balance at End of Year Year Ended December 31, 2023 $ 4,917 $ — $ (1,798) $ 3,119 Year Ended December 31, 2022 $ 2,035 $ 2,882 $ — $ 4,917 Year Ended December 31, 2021 $ — $ 2,035 $ — $ 2,035 |
Property, Equipment and Softwar
Property, Equipment and Software | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property, Equipment and Software | Property, Equipment and Software Property, equipment and software consists of the following (in thousands): December 31, 2023 2022 Computer equipment $ 3,542 $ 3,489 Software 9,759 9,604 Furniture and office equipment 706 713 Motor vehicles 50 50 Lab equipment 46,452 46,474 Leasehold improvements 48,620 52,974 Construction in progress 1,112 356 Property, equipment and software 110,241 113,660 Less accumulated depreciation and amortization (88,394) (84,085) Property, equipment and software, net $ 21,847 $ 29,575 Depreciation and amortization expense related to property, equipment and software for the years ended December 31, 2023, 2022 and 2021 was $9.6 million, $11.9 million and $11.3 million, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Leases The Company has non-cancelable operating leases for manufacturing, laboratory, office and warehouse space in Maryland The Company’s leases each have one or more five-year options to renew . In December 2022, the Company amended the existing lease on its headquarters space to extend the lease term through 2035 in exchange for certain concessions from the lessor. This amendment was accounted for as a lease modification, and the right-of-use asset and lease liability were remeasured at the modification date, resulting in an increase to both balances of approximately $14.0 million. The table below presents supplemental balance sheet information related to operating leases: December 31, 2023 2022 Weighted-average remaining lease term (in years) 11.0 11.1 Weighted-average discount rate 12.0 % 12.0 % During the years ended December 31, 2023 and 2022, t he Company made cash payments for operating leases of $5.9 million and $6.9 million, respectively. As of December 31, 2023 and 2022, the Company’s ROU assets were valued at $23.8 million and $27.3 million, respectively. The components of lease cost for the years ended December 31, 2023 and 2022 were as follows (in thousands): December 31, 2023 2022 Operating lease cost $ 7,459 $ 5,597 Variable lease cost 1,316 1,451 Sublease income (1,109) (1,076) Net lease cost $ 7,666 $ 5,972 As of December 31, 2023 , the maturities of the Company’s operating lease liabilities were as follows (in thousands): 2024 $ 4,004 2025 5,084 2026 4,209 2027 4,927 2028 6,049 Thereafter 46,003 Total lease payments 70,276 Less: imputed interest (36,306) Total lease liabilities $ 33,970 In-licensing arrangement In January 2022, the Company entered into a non-exclusive license agreement with Synaffix B.V., a Lonza company, (Synaffix) to develop, manufacture and commercialize up to three antibody-drug conjugate targets using Synaffix’s proprietary technology. The Company made an upfront payment to Synaffix upon contract execution. In March 2023, the Company and Synaffix amended the agreement, adding four additional targets. Assuming all seven targets are successfully developed and commercialized, the Company would be obligated to pay up to $2.8 billion for development, regulatory and sales milestones. Finally, pursuant to the terms of this license agreement, as amended, upon commencement of commercial sales of any products developed from these targets, the Company would be required to pay Synaffix tiered royalties in the low‑single digit percentages on net sales of the respective products. The Company may terminate this agreement at any time with 30 days’ notice to Synaffix. Amounts paid to Synaffix under this agreement are recorded as research and development expense in the consolidated statement of operations. The Company incurred $2.8 million and $1.0 million in expense under this agreement during the years ended December 31, 2023 and 2022, respectively. |
Royalty Monetization Arrangemen
Royalty Monetization Arrangement | 12 Months Ended |
Dec. 31, 2023 | |
Royalty Monetization Arrangement [Abstract] | |
Royalty Monetization Arrangement | 7. Royalty Monetization Arrangement In March 2023, the Company entered into a Purchase and Sale Agreement (Royalty Purchase Agreement) with DRI Healthcare Acquisitions LP (DRI), a wholly owned subsidiary of DRI Healthcare Trust, for the sale to DRI of the Company’s single-digit royalty interest on global net sales of TZIELD (teplizumab-mzwv) under the Company’s asset purchase agreement dated May 7, 2018, as amended (the Provention APA), with Provention. The Company retained its other economic interests related to TZIELD under the Provention APA, including future potential development, regulatory, and commercial milestones. Under the terms of the Royalty Purchase Agreement, the Company received $100.0 million from DRI for its single-digit royalty interest on global net sales of TZIELD under the Provention APA (the Royalty Interest). Additionally, the Company has the right to receive a 50% share of the royalty on global net sales above a certain annual threshold (the Retained Interest). In addition, the Company was eligible to receive up to $50.0 million upon the occurrence of pre-specified events tied to the advancement of TZIELD for the treatment of newly diagnosed type 1 diabetes. This milestone was achieved in July 2023 as described below. The Company is also eligible to receive an additional $50.0 million milestone if TZIELD achieves a certain level of net sales (Sales Milestone Payment). The $100.0 million proceeds received from DRI for the Royalty Interest were recorded as a liability related to future royalties, net of transaction costs of $0.3 million, which was to be amortized over the term of the arrangement using the effective interest rate method. At inception, the Company accounted for the Royalty Purchase Agreement as a financing arrangement because the Company had significant continuing involvement in the delivery of future royalty payments to DRI and other existing obligations under the Provention APA. In April 2023, the Company entered into an agreement (the Tripartite Agreement) with DRI and a subsidiary of Sanofi S.A. (Sanofi), whereby the Company consented to the sale of DRI’s Royalty Interest and related milestone payment obligations to Sanofi. The Tripartite Agreement eliminated the Company’s obligation to deliver payments to DRI related to the Royalty Interest and removed all of the Company’s other obligations under the Royalty Purchase Agreement. The Royalty Interest will be paid directly to Sanofi by Provention. As a result, the Company’s royalty rights are only for the Retained Interest. This change in rights and obligations resulted in a change in the terms of the liability related to future royalties which was evaluated by the Company in accordance with ASC 470-50, Debt — Modifications and Extinguishments . The Company concluded that the execution of the Tripartite Agreement resulted in a modification to the liability related to future royalties. The Company determined that the terms of the new liability related to the single-digit future royalties and the original liability related to future royalties were substantially different as the Company no longer receives payments for the Royalty Interest and therefore has a significantly reduced liability to make payments in accordance with the Royalty Purchase Agreement. The new liability related to future royalties was determined to be de minimis. As a result, the Company recorded $100.9 million within other income on the statement of operations and comprehensive loss during the three months ended June 30, 2023. There was no modification to the Company's Retained Interest in the Tripartite Agreement. In July 2023, Sanofi reported achievement of the primary endpoint milestone event related to the $50.0 million milestone noted above. Given that the Company has no continuing obligation to pay the Royalty Interest to Sanofi, the Company recorded this milestone within other income on the statement of operations and comprehensive loss during the three months ended September 30, 2023. Also in September 2023, the Company and Sanofi executed Amendment No. 2 to the Provention APA to incorporate the Sales Milestone Payment obligation from the Royalty Purchase Agreement into the Provention APA. In addition, the Company and Sanofi terminated the Royalty Purchase Agreement, which did not result in a material impact to the financial statements given the fair value of the liability related to future royalties was de minimis. Changes to the liability related to future royalties were as follows for the year ended December 31, 2023 (in thousands): Liability related to future royalties - beginning balance $ — Proceeds from sale of future royalties 150,000 Deferred transaction costs (343) Royalty revenue payable to DRI (157) Interest expense recognized 1,430 Gain on royalty monetization arrangement (150,930) Liability related to future royalties - ending balance $ — |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2023 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders' Equity The Company's amended and restated certificate of incorporation authorizes 125,000,000 shares of common stock, and 5,000,000 shares of undesignated preferred stock, both with a par value of $0.01 per share. There were no shares of undesignated preferred stock issued or outstanding as of December 31, 2023 or 2022. In November 2020, the Company entered into a sales agreement (Sales Agreement) with an agent to sell, from time to time, shares of its common stock having an aggregate sales price of up to $100.0 million through an “at the market offering” (ATM Offering) as defined in Rule 415 under the Securities Act of 1933, as amended. The Company sold 3,622,186 shares of common stock resulting in net proceeds of approximately $98.2 million through December 31, 2021 under the Sales Agreement. In April 2021, the Company entered into Amendment No. 1 to the Sales Agreement which increased the amount of the Company’s common stock that can be sold by the Company through its agent under the ATM Offering, from an aggregate offering price of up to $100.0 million to an aggregate offering price of up to $300.0 million. During the year ended December 31, 2022, the Company sold 160,480 shares of common stock at a weighted average price per share of $6.87, resulting in net proceeds of approximately $1.1 million, net of underwriting discounts and commissions and other offering expenses. In March 2023, the Company terminated the Sales Agreement and entered into a new sales agreement with an agent to sell, from time to time, shares of its common stock having an aggregate sales price of up to $100.0 million through an ATM Offering. During the year ended December 31, 2023, the Company sold 95,000 shares of common stock at a weighted average price per share of $6.60, resulting in net proceeds of approximately $0.6 million, net of offering expenses. |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2023 | |
Collaboration and License Agreements [Abstract] | |
Revenue | Revenue Collaborative and Other Agreements Incyte Corporation Incyte License Agreement In 2017, the Company entered into an exclusive global collaboration and license agreement with Incyte, which was amended in March 2018, April 2022 and July 2022, for retifanlimab, an investigational monoclonal antibody that inhibits PD-1 (Incyte License Agreement). Incyte has obtained exclusive worldwide rights for the development and commercialization of retifanlimab in all indications, while the Company retains the right to develop its pipeline assets in combination with retifanlimab. Under the terms of the Incyte License Agreement, Incyte paid the Company an upfront payment of $150.0 million in 2017. MacroGenics will manufacture a portion of Incyte’s global commercial supply of retifanlimab. In March 2023, the FDA approved Incyte's Biologics License Application (BLA) for ZYNYZ (retifanlimab-dlwr) for the treatment of adults with metastatic or recurrent locally advanced Merkel cell carcinoma. Incyte has stated it is pursuing development of retifanlimab in potentially registration-enabling studies, including in patients with Merkel cell carcinoma, squamous cell carcinoma of the anal canal, MSI-high endometrial cancer and non-small cell lung cancer. Incyte is also pursuing development of retifanlimab in combination with multiple product candidates from its pipeline. Under the terms of the Incyte License Agreement, as amended, Incyte will lead global development of retifanlimab. Assuming successful development and commercialization by Incyte in multiple indications, the Company could receive up to a total of $435.0 million in development and regulatory milestones, and up to $330.0 million in commercial milestones. From the inception of the Incyte License Agreement through December 31, 2023 , the Company has recognized $115.0 million in development milestones under the Incyte License Agreement, including $15.0 million received following the FDA approval of ZYNYZ. The Company is eligible to receive tiered royalties of 15% to 24% on global net sales. The Company retains the right to develop its pipeline assets in combination with retifanlimab, with Incyte commercializing retifanlimab and the Company commercializing its asset(s), if any such potential combinations are approved. In addition, the Company retains the right to manufacture a portion of both companies' global commercial supply needs of retifanlimab, subject to the separate commercial supply agreement. The Company evaluated the Incyte License Agreement under the provisions of ASC 606 at inception and identified the following two performance obligations under the agreement: (i) the license of retifanlimab and (ii) the performance of certain clinical activities through a brief technology transfer period. The Company determined that the license and clinical activities are separate performance obligations because they are capable of being distinct, and are distinct in the context of the contract. The license has standalone functionality as it is sublicensable, Incyte has significant capabilities in performing clinical trials, and Incyte is capable of performing these activities without the Company's involvement; the Company performed the activities during the transfer period as a matter of convenience. The Company determined that the transaction price of the Incyte License Agreement at inception was $154.0 million, consisting of the consideration to which the Company was entitled in exchange for the license and an estimate of the consideration for clinical activities to be performed. The transaction price was allocated to each performance obligation based on their relative standalone selling price. The standalone selling price of the license was determined using the adjusted market assessment approach considering similar collaboration and license agreements. The standalone selling price for the agreed-upon clinical activities to be performed was determined using the expected cost approach based on similar arrangements the Company has with other parties. The potential development and regulatory milestone payments are fully constrained until the Company concludes that achievement of the milestone is probable and that recognition of revenue related to the milestone will not result in a significant reversal in amounts recognized in future periods, and as such have been excluded from the transaction price. Any consideration related to sales-based milestones and royalties will be recognized when the related sales occur, as they were determined to relate predominantly to the license granted to Incyte and, therefore, have also been excluded from the transaction price. The Company re-assesses the transaction price in each reporting period and when events whose outcomes are resolved or other changes in circumstances occur. From 2018 through December 31, 2023 , it became probable that a significant reversal of cumulative revenue would not occur for development milestones totaling $115.0 million related to clinical and regulatory activities related to the further advancement of retifanlimab. Therefore the associated consideration was added to the estimated transaction price and was recognized as revenue. The Company recognized the $150.0 million allocated to the license when it satisfied its performance obligation and transferred the license to Incyte in 2017. The $4.0 million allocated to the clinical activities was recognized ratably as services were performed during 2017 and 2018. The Company recognized the $15.0 million ZYNYZ approval milestone as revenue under the Incyte License Agreement during the year ended December 31, 2023. The Company recognized revenue of $15.0 million, $30.0 million and $15.0 million under the Incyte License Agreement during the years ended December 31, 2023, 2022 and 2021, respectively, all of which was related to development milestones. Incyte Clinical Supply Agreement In 2018, the Company entered into an agreement with Incyte under which the Company is to perform development and manufacturing services for Incyte’s clinical needs of retifanlimab (Incyte Clinical Supply Agreement). The Company evaluated this agreement under ASC 606 and identified one performance obligation under the agreement: to perform services related to the development and manufacturing of the clinical supply of retifanlimab. The transaction price is based on the costs incurred to develop and manufacture drug product and drug substance, and is recognized over time as the services are provided, as the performance by the Company does not create an asset with an alternative use and the Company has an enforceable right to payment for the performance completed to date. The transaction price is being recognized using the input method reflecting the costs incurred (including resources consumed and labor hours expended) related to the manufacturing services. During the years ended December 31, 2023 , 2022 and 2021, the Company recognized revenue of $1.9 million, $0.7 million and $1.5 million, respectively, for services performed under this agreement. Incyte Commercial Supply Agreement In 2020, the Company entered into an agreement with Incyte pursuant to which the Company is entitled to manufacture a portion of the global commercial supply needs for retifanlimab (Incyte Commercial Supply Agreement). Unless terminated earlier, the term of the Incyte Commercial Supply Agreement will expire upon the expiration of Incyte’s obligation to pay royalties under the Incyte License Agreement. The Company evaluated this agreement under ASC 606 and identified one performance obligation under the agreement: to perform services related to manufacturing the commercial supply of retifanlimab. The transaction price is based on a fixed price per batch of bulk drug substance to be manufactured and is recognized over time as the services are provided, as the performance by the Company does not create an asset with an alternative use and the Company has an enforceable right to payment for the performance completed to date. The transaction price is being recognized using the input method reflecting the costs incurred (including resources consumed and labor costs incurred) related to the manufacturing services. During the years ended December 31, 2023, 2022, and 2021 the Company recognized revenue of $4.2 million, $0.3 million and $7.8 million, respectively, for services performed under this agreement. Gilead Sciences, Inc In October 2022, the Company and Gilead Sciences, Inc. (Gilead) entered into an exclusive option and collaboration agreement (Gilead Agreement) to develop and commercialize MGD024, an investigational, bispecific antibody that binds CD123 and CD3, and create bispecific cancer antibodies using the Company’s DART platform and undertake their early development under a maximum of two separate bispecific cancer target research programs. Under the agreement, the Company will continue the ongoing phase 1 trial for MGD024 accordi ng to a development plan , during which Gilead will have the right to exercise an option granted to Gilead to obtain an exclusive license under the Company’s intellectual property to develop and commercialize MGD024 and other bispecific antibodies of MacroGenics that bind CD123 and CD3 (CD123 Option). The agreement also grants Gilead the right, within its first two years, to nominate a bispecific cancer target set for up to two research programs conducted by the Company and to exercise separate options to obtain an exclusive license for the development, commercialization and exploitation of molecules created under each research program (Research Program Option). Gilead nominated the first of the two research programs in September 2023. Under the terms of the Gilead Agreement, in October 2022 Gilead paid the Company an upfront payment of $60.0 million . Assuming Gilead exercises the CD123 Option and Research Program Option and successfully develops and commercializes MGD024, or other CD123 products developed under the agreement, and products result from the two additional research programs, the Company would be eligible to receive up to $1.7 billion in target nomination, option fees, and development, regulatory and commercial milestones. Assuming exercise of the CD123 Option, the Company will also be eligible to receive tiered, low double-digit royalties on worldwide net sales of MGD024 (or other CD123 products developed under the agreement) and assuming exercise of the Research Program Option, a flat royalty on worldwide net sales of any products resulting from the two research programs. The Company evaluated the Gilead Agreement under the provisions of ASC 606 and identified the following material promises under the agreement: (i) a license to perform any activities allocated to Gilead under the MGD024 development plan ; (ii) development activities regarding MGD024, including manufacturing, research and early clinical development activities, necessary to deliver an informational package of development and clinical data, information and materials specified in the Gilead Agreement during the period in which Gilead can exercise the CD123 Option; (iii) the CD123 Option and (iv) the Research Program Option . The Company concluded that the license under the MGD024 developme nt plan and development activities are not distinct from one another, as the license has limited value without the Company’s performance of the development activities. Therefore, the Company determined that the development term license and development activities should be combined into a single performance obligation (Development Activities). The CD123 Option is considered a material right as the value of the exclusive license exceeds the payment to be made by Gilead if they exercise their option to obtain an exclusive license to develop and commercialize MGD024 or an alternative CD123 product, and is therefore a distinct performance obligation. The Company determined that the Research Program Option does not provide a material right, as there is no discount on its standalone selling price. In accordance with ASC 606, the Company determined that the initial transaction price under the Gilead Agreement was $60.0 million, consisting of the upfront, non-refundable payment paid by Gilead. The CD123 Option and Research Program Option payments are excluded from the initial transaction price at contract inception along with any future development, regulatory, and commercial milestone payments (including royalties) following the CD123 Option and Research Program Option exercise. The Company will reassess the amount of variable consideration included in the transaction price every reporting period. The Company allocated the $60.0 million upfront payment in the transaction price to the Development Activities and the CD123 Option based on each performance obligation’s relative standalone selling price. The standalone selling price for the Development Activities was calculated using an expected cost-plus margin approach for the pre-option development timeline. For the standalone selling price of the CD123 Option, the Company utilized an income-based approach which included the following key assumptions: post-option development timeline and costs, forecasted revenues, discount rates and probabilities of technical and regulatory success. The Company is recognizing revenue related to the Development Activities performance obligation over the estimated period to complete the Development Activities using an input method reflecting the costs incurred (including resources consumed and labor hours expended) related to the Development Activities. The Company has deferred revenue recognition related to the CD123 Option. If Gilead exercises the CD123 Option and obtains an exclusive license, the Company will recognize revenue as it fulfills its obligations under the Gilead Agreement. If the CD123 Option is not exercised, the Company will recognize the entirety of the revenue in the period when the CD123 Option expires. During the years ended December 31, 2023 , and 2022, the Company recorded revenue of $1.5 million and $0.2 million respectively, related to the Gilead Agreement. As of December 31, 2023 , $58.3 million in revenue was deferred under this agreement, $2.2 million of which was current and $56.1 million of which was non-current.As of December 31, 2022, $59.8 million in revenue was deferred under this agreement, $1.8 million of which was current and $58.0 million of which was non-current. During the year ended December 31, 2023, the Company and Gilead executed a Letter Agreement through which Gilead nominated the first of the two research programs contemplated in the Gilead Agreement (First Research Program), the Company granted Gilead a research license, and the parties agreed on a research plan for the First Research Program under which the Company will provide research and development services. Gilead paid the Company a $15.7 million nomination fee. The Company evaluated the Letter Agreement under the terms of ASC 606, and concluded that it is a modification to the Gilead Agreement that results in a separate contract since the modification is for additional goods and services that are distinct and at standalone selling price. The Company determined that the license and the related research and development activities were not distinct from one another, as the license has limited value without the performance of the research and development activities. As such, the Company determined that these should be combined into a single performance obligation. Gilead also has the exclusive option to pay the Company $10.0 million to obtain a license to exploit the research molecule and research product with respect to the First Research Program. The Company determined that this exclusive option does not provide a material right, as there is no discount on its standalone selling price. In accordance with ASC 606, the Company determined that the initial transaction price for the First Research Program agreement was $15.7 million, consisting of the non-refundable payment paid by Gilead. The Company is recognizing revenue over the estimated period to complete the services using the input method reflecting the costs incurred (including resources consumed and labor hours expended) related to the research and development services. During the year ended December 31, 2023 , the Company recorded revenue of $0.8 million related to the First Research Program. As of December 31, 2023, $14.9 million in revenue was deferred under this agreement, $11.8 million of which was current and $3.1 million of which was non-current. Zai Lab US LLC In 2021, the Company entered into a collaboration and license agreement with Zai Lab US LLC (Zai Lab Limited and Zai Lab US LLC, either singularly or collectively are referred to herein as Zai Lab) involving collaboration programs and license-only programs (collectively, the Programs) encompassing four separate immuno-oncology molecules (2021 Zai Lab Agreement). During 2022, the Company and Zai Lab agreed to discontinue research and development of the lead program, and in August 2023, the parties mutually agreed to terminate the 2021 Zai Lab Agreement. In connection with the execution of the 2021 Zai Lab Agreement, Zai Lab paid the Company an upfront payment of $25.0 million. Additionally, as part of the consideration for the rights granted to Zai Lab under the 2021 Zai Lab Agreement, the Company and Zai Lab entered into a stock purchase agreement whereby Zai Lab paid the Company approximately $30.0 million to purchase shares of the Company’s common stock, par value $0.01, at a fixed price of $31.30 which represented a $10.4 million premium over the share price on the stock purchase agreement date. The Company was also entitled to receive reimbursements from Zai Lab for certain research and development costs incurred by the Company and milestones and tiered royalties on annual net sales of products in Zai Lab’s territory assuming successful development and commercialization of the Programs. The Company evaluated the 2021 Zai Lab Agreement under the provisions of ASC 606 and identified the following material promises: (i) exclusive licenses to develop, manufacture and commercialize the products in Zai Lab’s territory for each Program and (ii) certain research and development activities for the lead program. The Company determined that for the lead program, the license was not distinct from the related research and development activities, considering the early stage of development of the molecule and the Company’s significant expertise in this area and as such, the research and development services were expected to significantly modify and customize the license. Therefore, for the lead program, the license and the services were combined into a single performance obligation. Since the other programs each represented distinct intellectual property and there were no other services included in the 2021 Zai Lab Agreement related to these licenses, each license was considered to be a distinct performance obligation. As such, there were four performance obligations included in the 2021 Zai Lab Agreement. The Company concluded that the estimated transaction price was $40.4 million, consisting of the $25.0 million upfront payment, the $10.4 million premium related to the purchase of the Company’s common stock, and the $5.0 million estimated reimbursement by Zai Lab for research and development activities for the lead program. The potential milestone payments were deemed to be fully constrained until the Company concludes that achievement of the milestone is probable, and that recognition of revenue related to the milestone will not result in a significant reversal in amounts recognized in future periods, and as such were excluded from the transaction price. Any consideration related to royalties would have been recognized if and when the related sales occurred, as they were determined to relate predominantly to the license granted to Zai Lab and, therefore, were also excluded from the transaction price. The Company re-assessed the transaction price in each reporting period and when events whose outcomes were resolved or other changes in circumstances occurred. The transaction price of $40.4 million was then allocated to the four performance obligations based on their relative standalone selling price. The standalone selling price of the performance obligations was not directly observable; therefore, the Company estimated the standalone selling price using an adjusted market assessment approach, representing the amount that the Company believed a market participant was willing to pay for the product or service. The estimate was based on consideration of observable inputs, such as, values of other preclinical collaboration arrangements adjusted for the Company’s estimate of the probability of success for each Program. Revenue related to the lead program license and related research and development services performance obligation was recognized over time as the research and development activities were performed. The Company utilized a cost-based input method according to costs incurred to date compared to estimated total costs. The transfer of control occurred over this time period and, in management’s judgment, was the best measure of progress towards satisfying the performance obligations. The Company recognized revenue allocated to the other programs at a point in time upon transfer of the licenses to Zai Lab in June 2021. During the year ended December 31, 2023, no revenue was recognized under the 2021 Zai Lab Agreement. During the years ended December 31, 2022, and 2021, the Company recognized revenue of $16.8 million and $20.3 million , respectively, under the 2021 Zai Lab Agreement. Provention Bio, Inc. In 2018, the Company entered into a license agreement with Provention pursuant to which the Company granted Provention exclusive global rights for the purpose of developing and commercializing MGD010 (renamed PRV-3279), a CD32B x CD79B DART molecule being developed for the treatment of autoimmune indications (Provention License Agreement). As partial consideration for the Provention License Agreement, Provention granted the Company a warrant to purchase shares of Provention’s common stock at an exercise price of $2.50 per share. If Provention successfully develops, obtains regulatory approval for, and commercializes PRV-3279, the Company will be eligible to receive up to $65.0 million in development and regulatory milestones and up to $225.0 million in commercial milestones. As of December 31, 2023, the Company has not recognized any milestone revenue under this agreement. If commercialized, the Company would be eligible to receive single-digit royalties on net sales of the product. The license agreement may be terminated by either party upon a material breach or bankruptcy of the other party, by Provention without cause upon prior notice to the Company, and by the Company in the event that Provention challenges the validity of any licensed patent under the agreement, but only with respect to the challenged patent. Also, in 2018, the Company entered into the Provention APA pursuant to which Provention acquired the Company’s interest in teplizumab (renamed PRV-031), a monoclonal antibody being developed for the treatment of type 1 diabetes. As partial consideration for the Provention APA, Provention granted the Company a warrant to purchase shares of Provention’s common stock at an exercise price of $2.50 per share. Under the Provention APA, Provention is obligated to pay the Company contingent milestone payments totaling $170.0 million upon the achievement of certain regulatory milestones. In addition, Provention is obligated to make contingent milestone payments to the Company totaling $225.0 million upon the achievement of certain commercial milestones as well as single-digit royalties on net sales of the product. In March 2023, the Company entered into a Royalty Purchase Agreement with DRI; see Note 7, Royalty Monetization Arrangement, for additional information. The FDA approved the BLA for TZIELD in November 2022, and the Company recognized $60.0 million in revenue related to this regulatory milestone during the year ended December 31, 2022. In November 2022, the Company and Provention amended the Provention APA. Under this amendment, the milestone for first approval was split into four equal payments, all of which were received prior to June 30, 2023. Provention has also agreed to pay third-party obligations, including low single-digit royalties, of which a portion is creditable against royalties payable to the Company, aggregate milestone payments of up to approximately $1.3 million and other consideration, for certain third-party intellectual property under agreements Provention assumed pursuant to the Provention APA. Further, Provention is required to pay the Company a low double-digit percentage of certain consideration to the extent it is received in connection with a future grant of rights to PRV-031 by Provention to a third party. The Company evaluated the Provention License Agreement and Provention APA under the provisions of ASC 606 and determined that they should be accounted for as a single contract and identified two performance obligations within that contract: (i) the license of MGD010 and (ii) the title to teplizumab. The Company determined that the transaction price of the Provention agreements was $6.1 million, based on the Black-Scholes valuation of the warrants to purchase a total of 2,432,688 shares of Provention's common stock. The transaction price was allocated to each performance obligation based on the number of shares of common stock the Company is entitled to purchase under each warrant. The potential development and regulatory milestone payments are fully constrained until the Company concludes that achievement of the milestone is probable and that recognition of revenue related to the milestone will not result in a significant reversal in amounts recognized in future periods, and as such were excluded from the initial transaction price. Any consideration related to sales-based milestones and royalties will be recognized when the related sales occur, therefore they have also been excluded from the transaction price. The Company re-assesses the transaction price in each reporting period and when events whose outcomes are resolved or other changes in circumstances occur. The Company recognized revenue of $6.1 million when it satisfied its performance obligations under the agreements and transferred the MGD010 license and teplizumab assets to Provention in 2018. In 2019, the Company exercised the warrants on a cashless basis, and subsequently sold all the shares of Provention common stock acquired through the exercise. No shares of Provention stock were held subsequent to the sale of stock in 2019. During the year ended December 31, 2022, it became probable that a significant reversal of cumulative revenue would not occur for a regulatory milestone of $60.0 million , t herefore the associated consideration was added to the estimated transaction price and was recognized as revenue. During the years ended December 31, 2023, 2022 and 2021, the Company recognized revenue of $5.6 million, $60.0 million and $1.3 million, respectively, under these agreements. On April 27, 2023, Sanofi completed its acquisition of Provention and the Company entered into a Tripartite Agreement, as discussed in Note 7, Royalty Monetization Arrangement. Also on April 27, 2023, the Company and a subsidiary of Sanofi entered into a Side Letter Agreement which specified certain post-closing covenants and also accelerated certain payments due to the Company under the Provention APA upon the closing of the merger between Sanofi and Provention. The Company evaluated the Side Letter Agreement as a contract modification under the provisions of ASC 606. As a result, during the year ended December 31, 2023 , the Company recognized $5.5 million related to other consideration under the Provention APA and Side Letter Agreement. During the year ended December 31, 2023, the Company recognized $0.3 million in royalty revenue under the Provention APA based on sales of TZIELD. As discussed in Note 7, in September 2023, the Company and Sanofi executed Amendment No. 2 to the Provention APA and terminated the Royalty Purchase Agreement with DRI. As a result, the remaining $50.0 million milestone under the Royalty Purchase Agreement was incorporated into the Provention APA. The Company evaluated the amendment as a contract modification under the provisions of ASC 606 which did not result in any additional revenue being recognized during the year ended December 31, 2023. Manufacturing Services Agreements Incyte In January 2022, the Company entered into a Manufacturing and Clinical Supply Agreement with Incyte (Incyte Manufacturing and Clinical Supply Agreement) to provide manufacturing services to produce certain Incyte bulk drug substance over a three-year period at one of the Company’s manufacturing facilities. Under the terms of the Incyte Manufacturing and Clinical Supply Agreement, the Company received an upfront payment of $10.0 million and is eligible to receive annual fixed payments paid quarterly over the term of the contract totaling $14.4 million. The Company will also be reimbursed for materials used to manufacture product as well as other costs incurred to provide manufacturing services. In July 2022, the Company and Incyte executed an amendment to the Incyte Manufacturing and Clinical Supply Agreement which extended the term for one year and provided for an additional annual fixed payment of $5.1 million (July 2022 Incyte Amendment). The Company evaluated the Incyte Manufacturing and Clinical Supply Agreement and the July 2022 Incyte Amendment under the provisions of ASC 606 and identified one performance obligation to provide manufacturing runs to Incyte, as and when requested by Incyte, over the term of the contract that is part of a series of goods and services. The Company determined that the transaction price consists of the upfront payment received of $10.0 million and the annual fixed payments totaling $19.5 million. The Company will recognize revenue over time on a straight-line basis as the manufacturing services are provided to Incyte, as the Company determined that its efforts in providing the manufacturing services will be incurred evenly throughout the performance period and therefore straight-line revenue recognition closely approximates the level of effort for the manufacturing services. Variable consideration relating to the reimbursed materials and other reimbursed costs incurred to manufacture product for Incyte will be allocated to the related manufacturing activities and will be recognized as revenue as those activities occur. Materials purchased by the Company to manufacture the product for Incyte are considered costs to fulfill a contract and will be capitalized and expensed as the materials are used to provide the manufacturing services. During the years ended December 31, 2023 and 2022, the Company recognized revenue of $9.7 million and $8.7 million, respectively, under the Incyte Manufacturing and Clinical Supply Agreement. As of December 31, 2023, $7.0 million in revenue was deferred under this agreement, all of which was current. As of December 31, 2022, $9.6 million in revenue was deferred under this agreement, $8.1 million of which was current and $1.5 million of which was non-current. Provention In June 2022, the Company entered into a Manufacturing and Clinical Supply Agreement with Provention (Provention Manufacturing and Clinical Supply Agreement) to provide manufacturing services to produce certain Provention bulk drug substance. Under the terms of the Provention Manufacturing and Clinical Supply Agreement, the Company received an upfront payment and payments in accordance with the manufacturing schedule. The Company was also reimbursed for materials used to manufacture product as well as other costs incurred to provide manufacturing services. The Company evaluated the Provention Manufacturing and Clinical Supply Agreement under the provisions of ASC 606 and identified one performance obligation to provide manufacturing services to Provention. The Company determined that the transaction price consisted of the upfront and other fixed payments totaling $4.6 million. The Company will recognize revenue over time on a straight-line basis as the manufacturing services are provided to Provention, as the Company determined that it |
Stock-based Compensation
Stock-based Compensation | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-based Compensation | Stock-based Compensation Employee Stock Purchase Plan In May 2017, the Company’s stockholders approved the 2016 Employee Stock Purchase Plan (the 2016 ESPP). The 2016 ESPP is structured as a qualified employee stock purchase plan under Section 423 of the Internal Revenue Code of 1986, as amended, and is not subject to the provisions of the Employee Retirement Income Security Act of 1974. The Company reserved 800,000 shares of common stock for issuance under the 2016 ESPP. The 2016 ESPP allows eligible employees to purchase shares of the Company’s common stock at a discount through payroll deductions of up to 10% of their eligible compensation, subject to any plan limitations. The 2016 ESPP provides for six-month offering periods ending on May 31 and November 30 of each year. At the end of each offering period, employees are able to purchase shares at 85% of the fair market value of the Company’s common stock on the last day of the offering period. During the year ended December 31, 2023, employees purchased 81,541 shares of common stock under the 2016 ESPP for net proceeds to the Company of approximately $0.5 million. Employee Stock Incentive Plans In October 2013, the Company implemented the 2013 Equity Incentive Plan (2013 Plan). The 2013 Plan provides for the grant of stock options and other stock-based awards, as well as cash-based performance awards. In May 2023, the 2013 Plan was terminated, and no further awards may be issued under the plan. If an option granted under the 2013 Plan expires or terminates for any reason without having been fully exercised, if any shares of restricted stock are forfeited, or if any award terminates, expires or is settled without all or a portion of the shares of common stock covered by the award being issued, such shares will become available for issuance under the 2023 Equity Incentive Plan (2023 Plan). As of December 31, 2023, under the 2013 Plan, there were options to purchase an aggregate of 11,805,515 shares of common stock outstanding at a weighted average exercise price of $15.45 per share. As of December 31, 2023, there were 854,114 unvested restricted stock units (RSUs) outstanding under the 2013 Plan. The 2023 Plan was effective as of stockholder approval in May 2023. The 2023 Plan provides for grants of stock options and other stock-based awards, as well as cash-based performance awards. Initially, the maximum number of shares of the Company’s common stock that may be issued under the 2023 Plan will not exceed 4,850,000 shares. If an option expires or terminates for any reason without having been fully exercised, if any shares of restricted stock are forfeited, or if any award terminates, expires or is settled without all or a portion of the shares of common stock covered by the award being issued, such shares are available for the grant of additional awards. However, any shares that are withheld (or delivered) to pay withholding taxes or to pay the exercise price of an option are not available for the grant of additional awards. As of December 31, 2023, under the 2023 Plan, there were options to purchase an aggregate of 418,122 shares of common stock outstanding at a weighted average exercise price of $5.31 per share. As of December 31, 2023, there were 51,500 unvested RSUs outstanding under the 2023 Plan. The following stock-based compensation amounts were recognized for the periods indicated (in thousands): Year Ended December 31, 2023 2022 2021 Research and development $ 9,190 $ 10,094 $ 11,337 Selling, general and administrative 9,183 10,344 11,789 Total stock-based compensation expense $ 18,373 $ 20,438 $ 23,126 Employee Stock Options The Company accounts for stock-based compensation to employees and non-employee directors in accordance with ASC Topic 718, Compensation – Stock Compensation . The Company estimates the fair value of stock option awards using the Black-Scholes option pricing model on the date of grant using the assumptions in the table below. Stock options granted to employees generally vest over four years and have a term of ten years. Stock-based compensation expense for stock options is recognized as expense over the requisite service period, which is the vesting period. As the Company has not paid dividends since inception, nor does it expect to pay any dividends for the foreseeable future, the expected dividend yield assumption is zero. The expected volatility is based on the historical stock volatility of the Company’s own common stock over a period equal to the expected term of the options. The risk-free rate of the stock options is based on the U.S. Treasury rate in effect at the time of grant for the expected term of the stock options. The Company used the simplified method to calculate expected term during 2021. Beginning in 2022, the computation of expected term was determined based on the historical experience with similar awards, giving consideration to the contractual terms of the share-based awards, vesting schedules and expectations of future employee behavior. In addition, the Company estimates the expected forfeiture rate and only recognizes expense for those shares expected to vest. The Company estimates the forfeiture rate based on historical experience and its expectations regarding future pre-vesting termination behavior of employees. The Company reviews its estimate of the expected forfeiture rate annually, and stock-based compensation expense is adjusted accordingly. Year Ended December 31, 2023 2022 2021 Expected dividend yield 0% 0% 0% Expected volatility 76% -96% 88% - 92% 86% - 87% Risk-free interest rate 3.5% - 4.8% 1.4% - 4.0% 0.6% - 1.6% Expected term 5.88 years 5.95 years 6.25 years The following table summarizes stock option activity for 2023: Shares Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (Years) Aggregate Intrinsic Value (in thousands) Outstanding, December 31, 2022 10,098,929 $ 18.58 6.5 Granted 3,367,777 4.97 Exercised (34,608) 3.73 Forfeited (365,942) 9.49 Expired (842,519) 19.12 Outstanding, December 31, 2023 12,223,637 $ 15.11 6.7 $ 16,974 As of December 31, 2023: Exercisable 7,892,753 $ 18.92 5.6 $ 4,509 Vested and expected to vest 11,346,207 $ 15.59 6.5 $ 14,692 During 2023, 2022 and 2021 the Company issued 34,608, 120,900 and 332,767 shares of common stock, respectively, in conjunction with stock option exercises. The Company received cash proceeds from the exercise of stock options of approximately $0.1 million, $0.2 million and $5.8 million during 2023, 2022 and 2021, respectively. The weighted-average grant-date fair value of options granted during 2023, 2022 and 2021 was $3.83, $6.84 and $15.20 per share, respectively. The total intrinsic value of options exercised during 2023, 2022 and 2021 was approximately $0.1 million, $0.6 million and $3.3 million, respectively. The total fair value of stock options which vested during 2023, 2022 and 2021 was $16.4 million, $19.6 million and $20.2 million, respectively. As of December 31, 2023, the total unrecognized compensation expense related to non-vested stock options, net of related forfeiture estimates, was $19.5 million, which the Company expects to recognize over a weighted-average period of approximately 1.2 years. Restricted Stock Units The Company awards RSUs to employees. RSUs are valued based on the closing price of the Company’s common stock on the date of the grant. The fair value of RSUs is recognized and amortized on a straight-line basis over the requisite service period of the award . The following table summarizes RSU activity for 2023: Shares Weighted-Average Grant Date Fair Value Outstanding, December 31, 2022 415,084 $ 8.83 Granted 707,635 4.88 Vested (135,396) 8.32 Forfeited or expired (81,709) 7.17 Outstanding, December 31, 2023 905,614 $ 5.97 At December 31, 2023, there was $2.3 million of total unrecognized compensation cost related to unvested RSUs, which the Company expects to recognize over a remaining weighted-average period of 1.2 years. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes For the years ended December 31, 2023, 2022 and 2021 there was no provision for income taxes due to taxable losses generated, fully offset by a valuation allowance. The significant components of the Company's deferred income tax assets (liabilities) were as follows (in thousands): December 31, 2023 2022 Deferred income tax assets: Federal U.S. net operating loss carryforward $ 140,706 $ 163,071 State net operating loss carryforward 33,350 44,784 Research and development credit, net 68,251 65,084 Orphan drug credit, net 33,330 35,703 Operating lease liabilities 9,078 9,585 Deferred revenue 17,442 — Section 174 deferred tax asset 48,421 43,192 Equity based compensation 16,217 15,228 Other 6,617 4,663 Gross deferred income tax assets 373,412 381,310 Valuation allowance (365,010) (372,267) Net deferred income tax assets 8,402 9,043 Deferred income tax liabilities: Operating lease ROU assets (6,372) (7,522) Prepaid expenditures (2,030) (1,521) Gross deferred income tax liabilities (8,402) (9,043) Net deferred income tax asset/(liability) $ — $ — The Company recognizes valuation allowances to reduce deferred tax assets to the amount that is more likely than not to be realized. In assessing the likelihood of realization, management considers (i) future reversals of existing taxable temporary differences; (ii) future taxable income exclusive of reversing temporary difference and carryforwards; (iii) taxable income in prior carryback years if carryback is permitted under applicable tax law; and (iv) tax planning strategies. The Company's net deferred income tax asset is not more likely than not to be utilized due to the lack of sufficient sources of future taxable income and cumulative book losses which have resulted over the years. The activity in the valuation allowance on deferred tax assets was as follows (in thousands): Balance at Beginning of Year Additions Deductions Balance at End of Year Year Ended December 31, 2023 $ 372,267 $ — $ (7,257) $ 365,010 Year Ended December 31, 2022 $ 327,592 $ 44,675 $ — $ 372,267 Year Ended December 31, 2021 $ 263,400 $ 64,192 $ — $ 327,592 As of December 31, 2023, the Company has U.S. federal and state net operating loss (NOL) carryforwards of approximately $670.0 million. Of these NOLs, $65.5 million will expire in various years beginning in 2035 through 2037. $604.5 million of NOLs were generated post December 31, 2017 and carryforward indefinitely. In addition, the Company has U.S. federal tax credits of $94.4 million which will expire in various years beginning in 2024 through 2043. The reconciliation of the reported estimated income tax benefit to the amount that would result by applying the U.S. federal statutory tax rate to the net income is as follows (in thousands): Year Ended December 31, 2023 2022 2021 United States federal tax at statutory rate $ (1,902) $ (25,149) $ (42,445) State taxes (net of federal benefit) (163) (7,385) (12,806) Deferred income tax adjustments 5,024 308 473 Deferred state blended rate adjustments 1,841 — — Research credit, net (3,168) (4,569) (10,243) Orphan drug credit, net 2,374 (10,846) (1,449) Other permanent items 1,301 1,362 1,199 Equity-based compensation 1,950 1,604 1,079 Change in valuation allowance (7,257) 44,675 64,192 Income tax expense/(benefit) $ — $ — $ — A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows (in thousands): Year Ended December 31, 2023 2022 2021 Beginning balance $ 7,376 $ 7,197 $ 6,126 Increases for current year tax positions 449 548 965 Increases/(decreases) for prior year tax positions (4) (369) 106 Ending balance $ 7,821 $ 7,376 $ 7,197 As of December 31, 2023 and 2022, of the total gross unrecognized tax benefits, approximately $7.8 million and $7.4 million would favorably impact the Company's effective income tax rate, respectively. Although, due to the Company's determination that the deferred income tax asset would not more likely than not be realized, a valuation allowance would be recorded, therefore, zero net impact would result within the Company's effective income tax rate. The Company's uncertain income tax position liability has been recorded to deferred income taxes to offset the tax attribute carryforward amounts. For the years ended December 31, 2023, 2022 and 2021, the Company has not recognized any interest or penalties related to the uncertain income tax positions due to the fact such position is related to tax attribute carryforwards which have not yet been utilized. The Company does not expect its unrecognized income tax position to significantly decrease within the next twelve months. The Company's U.S. Federal and state income tax returns from 2004 forward remain open to examination due to the carryover of unused income tax credits, and from 2004 forward due to the carryover of unused net operating losses. Internal Revenue Code (IRC) Section 174 For tax years beginning on or after January 1, 2022, the Tax Cuts and Jobs Act of 2017 eliminates the option to currently deduct research and development expenses and requires taxpayers to capitalize and amortize them over five years for research activities performed in the United States and 15 years for research activities performed outside the United States pursuant to IRC Section 174. Although Congress is considering legislation that would repeal or defer this capitalization and amortization requirement, it is not certain that this provision will be repealed or otherwise modified. If the requirement is not repealed or replaced, it could increase our U.S. federal and state cash taxes and reduce cash flows in future years. |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2023 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plan | Employee Benefit Plan In 2002, the Company established the MacroGenics 401(k) Plan (the Plan) for its employees under Section 401(k) of the IRC. Under this Plan, all employees at least 21 years of age are eligible to participate in the Plan, starting on the first day of employment. Employees may contribute up to 100% of their salary, subject to government maximums. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Pay vs Performance Disclosure | |||
Net Income (Loss) | $ (9,058) | $ (119,758) | $ (202,115) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended | 12 Months Ended |
Dec. 31, 2023 shares | Dec. 31, 2023 shares | |
Trading Arrangements, by Individual | ||
Non-Rule 10b5-1 Arrangement Adopted | false | |
Rule 10b5-1 Arrangement Terminated | false | |
Non-Rule 10b5-1 Arrangement Terminated | false | |
James Karrels [Member] | ||
Trading Arrangements, by Individual | ||
Material Terms of Trading Arrangement | James Karrels, Senior Vice President and Chief Financial Officer, adopted a new trading plan on December 8, 2023 (with the first trade possible under the new plan no sooner than April 16, 2024). The trading plan will be effective until April 15, 2025 and covers the potential sale of up to 490,000 shares of common stock. (1) | |
Name | James Karrels | |
Title | Senior Vice President and Chief Financial Officer | |
Rule 10b5-1 Arrangement Adopted | true | |
Arrangement Duration | 494 days | |
Aggregate Available | 490,000 | 490,000 |
Jeffrey Peters [Member] | ||
Trading Arrangements, by Individual | ||
Material Terms of Trading Arrangement | Jeffrey Peters, Senior Vice President and General Counsel, adopted a new trading plan on December 8, 2023 (with the first trade possible under the new plan no sooner than April 4, 2024). The trading plan will be effective until March 20, 2025 and covers the potential sale of up to 370,842 shares of common stock. | |
Name | Jeffrey Peters | |
Title | Senior Vice President and General Counsel | |
Rule 10b5-1 Arrangement Adopted | true | |
Arrangement Duration | 468 days | |
Aggregate Available | 370,842 | 370,842 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, MacroGenics UK Limited and MacroGenics Limited. All intercompany accounts and transactions have been eliminated in consolidation. The Company currently operates in one operating segment. Operating segments are defined as components of an enterprise about which separate discrete information is available for the chief operating decision maker, or decision making group, in deciding how to allocate resources and assessing performance. The Company views its operations and manages its business in one segment, which is developing and commercializing monoclonal antibody-based therapeutics. |
Use of Estimates | Use of Estimates The preparation of the financial statements in accordance with generally accepted accounting principles (GAAP) requires the Company to make estimates and judgments in certain circumstances that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. In preparing these consolidated financial statements, management has made its best estimates and judgments of certain amounts included in the financial statements, giving due consideration to materiality. On an ongoing basis, the Company evaluates its estimates, including those related to revenue recognition, fair values of assets, inventory, preclinical study and clinical trial accruals and other contingencies. Management bases its estimates on historical experience or on various other assumptions that it believes to be reasonable under the circumstances. Although actual results could differ from these estimates, management does not believe that such differences would be material. |
Cash, Cash Equivalents and Marketable Securities | Cash, Cash Equivalents and Marketable Securities The Company considers all investments in highly liquid financial instruments with a maturity of 90 days or less at the date of purchase to be cash equivalents. Cash and cash equivalents includes investments in money market funds with commercial banks and financial institutions, securities issued by the U.S. government and its agencies, Government Sponsored Enterprise agency debt obligations and corporate debt obligations. Cash equivalents are stated at amortized cost, plus accrued interest, which approximates fair value. The Company carries marketable securities classified as available-for-sale at fair value as determined by prices for identical or similar securities at the balance sheet date. Classification of marketable securities between current and non-current is dependent upon the maturity date at the balance sheet date taking into consideration the Company’s ability and intent to hold the investment to maturity. Marketable securities consist of Level 2 financial instruments in the fair-value hierarchy. The Company records unrealized gains and losses as a component of other comprehensive loss within the statements of operations and comprehensive loss and as a separate component of stockholders' equity. Realized gains or losses on available-for-sale securities are determined using the specific identification method and the Company includes net realized gains and losses in other income, along with interest income and amortization of premiums and discounts. |
Accounts Receivable | Accounts Receivable Accounts receivable arise from product sales, amounts due from the Company’s collaborative partners and contract manufacturing work performed by the Company. The amount from product sales represents amounts due from specialty distributors. Accounts receivable that management has the intent and ability to collect are reported in the consolidated balance sheets at outstanding amounts, less an allowance for doubtful accounts. The Company writes off uncollectible receivables when the likelihood of collection is remote. The Company evaluates the collectability of accounts receivable on a regular basis. The allowance, if any, is based upon various factors including the financial condition and payment history of customers, an overall review of collections experience on other accounts and economic factors or events expected to affect future collections experience. No allowance was recorded as of December 31, 2023 or 2022, as the Company has a history of collecting on all outstanding accounts. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company's financial instruments consist of cash and cash equivalents, marketable securities, accounts receivable, accounts payable and accrued expenses. The carrying amount of accounts receivable, accounts payable and accrued expenses are generally considered to be representative of their respective fair values because of their short-term nature. The Company accounts for recurring and non-recurring fair value measurements in accordance with the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 820, Fair Value Measurements and Disclosures (ASC 820). ASC 820 defines fair value, establishes a fair value hierarchy for assets and liabilities measured at fair value, and requires expanded disclosures about fair value measurements. The ASC 820 hierarchy ranks the quality of reliability of inputs, or assumptions, used in the determination of fair value and requires assets and liabilities carried at fair value to be classified and disclosed in one of the following three categories: • Level 1 – Fair value is determined by using unadjusted quoted prices that are available in active markets for identical assets and liabilities. • Level 2 – Fair value is determined by using inputs other than Level 1 quoted prices that are directly or indirectly observable. Inputs can include quoted prices for similar assets and liabilities in active markets or quoted prices for identical assets and liabilities in inactive markets. Related inputs can also include those used in valuation or other pricing models, such as interest rates and yield curves that can be corroborated by observable market data. • Level 3 – Fair value is determined by inputs that are unobservable and not corroborated by market data. Use of these inputs involves significant and subjective judgments to be made by a reporting entity – e.g., determining an appropriate adjustment to a discount factor for illiquidity associated with a given security. The Company evaluates financial assets and liabilities subject to fair value measurements on a recurring basis to determine the appropriate level at which to classify them each reporting period. This determination requires the Company to make subjective judgments as to the significance of inputs used in determining fair value and where such inputs lie within the ASC 820 hierarchy. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash, cash equivalents, marketable securities and accounts receivable. The Company maintains its cash and money market funds with financial institutions that are federally insured. While balances deposited in these institutions often exceed Federal Deposit Insurance Corporation limits, the Company has not experienced any losses on related accounts to date. The Company's investment policy limits investments to certain types of debt securities issued by the U.S. government, its agencies and institutions with investment-grade credit ratings and places restrictions on maturities and concentration by type and issuer. The counterparties are various corporations, financial institutions and government agencies of high credit standing. |
Inventory | Inventory When the Company believes regulatory approval is probable and expects future economic benefit from the sales of a product candidate to be realized, the Company capitalizes manufacturing costs (whether internally produced or through third-party contract manufacturing organizations) as inventory. Prior to receiving its first approval from the FDA in December 2020, the Company expensed all costs incurred related to the manufacture of MARGENZA as research and development expense because of the inherent risks associated with the development of a product candidate, the uncertainty about the regulatory approval process and the lack of history for the Company of regulatory approval of drug candidates. Subsequent to FDA approval in December 2020, the Company began capitalizing its MARGENZA third-party contract manufacturing inventory costs. Inventory is composed of raw materials, work-in-process, and finished goods, which are goods that are available for sale. The Company values its inventories at the lower of cost or estimated net realizable value. The Company determines the cost of its inventories, which includes amounts related to materials and third-party contract manufacturing costs, on a first-in, first-out basis. The Company performs an assessment of the recoverability of capitalized inventory during each reporting period, and it writes down any excess, obsolete or unsaleable inventories to their estimated realizable value in the period in which the impairment is first identified. Such write downs, should they occur, are recorded within the cost of product sales in the statement of operations. |
Property, Equipment and Software | Property, Equipment and Software |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company assesses the recoverability of its long-lived assets in accordance with the provisions of ASC 360, Property, Plant and Equipment |
Liability related to the sale of future royalties and related interest expense | Liability related to the sale of future royalties and related interest expense The Company assesses the relevant accounting criteria under ASC 470, Debt (ASC 470) to determine whether the upfront payment received from the purchaser should be accounted for as debt or deferred income depending on the facts and circumstances. If the criteria in ASC 470 is met, the Company accounts for net proceeds from sales of its rights to receive future royalty payments as a liability that is amortized using the effective interest method over the term of the arrangement. The liability related to future royalties is presented net of unamortized issuance costs on the consolidated balance sheets. Interest expense on the liability related to future royalties is recognized using the effective interest rate method over the life of the arrangement. The Company calculates an effective interest rate which will amortize its related obligation to zero over the anticipated repayment period. The liability related to future royalties and the related interest expense are based on the Company’s current estimates of future royalties expected to be received over the life of the arrangement, which the Company determines by using internal sales projections and external information from market data sources, which are considered Level 3 inputs. The Company periodically assesses the expected payments and to the extent the Company’s estimates of future royalty payments are greater or less than previous estimates or the estimated timing of such payments is materially different than previous estimates, the Company will adjust the effective interest rate and recognize related non-cash interest expense on a prospective basis. Non-cash amortization is reflected as interest expense in the consolidated statements of operations and comprehensive loss. Upon changes in facts and circumstances, for example as a result of a modification to the existing agreements, the Company re-evaluates its rights and obligations and accounts for the change in accordance with the respective accounting guidance. |
Revenue Recognition | Revenue recognition The Company recognizes revenue under ASC Topic 606, Revenue from Contracts with Customer s (ASC 606) when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of ASC 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Collaborative and other agreements The Company enters into licensing agreements that are within the scope of ASC 606, under which it may license rights to research, develop, manufacture and commercialize its product candidates to third parties. The terms of these arrangements typically include payment to the Company of one or more of the following: non-refundable, upfront license fees; reimbursement of certain costs; customer option exercise fees; development, regulatory and commercial milestone payments; and royalties on net sales of licensed products. The Company may also enter into development and manufacturing service agreements with its collaborators. For each arrangement that results in revenues, the Company identifies all performance obligations, which may include a license to intellectual property and know-how, research and development activities, transition activities and/or manufacturing services. In order to determine the transaction price, in addition to any upfront payment, the Company estimates the amount of variable consideration at the outset of the contract either utilizing the expected value or most likely amount method, depending on the facts and circumstances relative to the contract. The Company constrains (reduces) the estimates of variable consideration such that it is probable that a significant reversal of previously recognized revenue will not occur. When determining if variable consideration should be constrained, management considers whether there are factors outside the Company’s control that could result in a significant reversal of revenue. In making these assessments, the Company considers the likelihood and magnitude of a potential reversal of revenue. These estimates are re-assessed each reporting period as required. Once the estimated transaction price is established, amounts are allocated to the performance obligations that have been identified. The transaction price is generally allocated to each separate performance obligation on a relative standalone selling price basis. The Company must develop assumptions that require judgment to determine the standalone selling price in order to account for these agreements. To determine the standalone selling price, the Company’s assumptions may include (i) the probability of obtaining marketing approval for the product candidate, (ii) estimates regarding the timing and the expected costs to develop and commercialize the product candidate, and (iii) estimates of future cash flows from potential product sales with respect to the product candidate. Standalone selling prices used to perform the initial allocation are not updated after contract inception. The Company does not include a financing component to its estimated transaction price at contract inception unless it estimates that certain performance obligations will not be satisfied within one year. Amounts received prior to revenue recognition are recorded as deferred revenue. Amounts expected to be recognized as revenue within the 12 months following the balance sheet date are classified as current portion of deferred revenue in the accompanying consolidated balance sheets. Amounts not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as deferred revenue, net of current portion. Licenses. When the Company grants a license to its intellectual property, it determines whether the nature of the intellectual property to which the customer will have rights is functional intellectual property (functional IP), which has significant standalone functionality, or symbolic intellectual property (symbolic IP) which does not have significant standalone functionality. Revenue from functional IP is recognized at the point in time when control of the distinct license is transferred to the customer. Revenue from symbolic IP is recognized over the access period to the Company’s intellectual property . If the license to the Company’s intellectual property is determined to be distinct from the other promises or performance obligations identified in the arrangement, the Company recognizes revenue from non-refundable, upfront fees allocated to the license when the license is transferred to the customer and when (or as) the customer is able to use and benefit from the license. In assessing whether a promise or performance obligation is distinct from the other promises, the Company considers factors such as the research, development, manufacturing and commercialization capabilities of the licensee and the availability of the associated expertise in the general marketplace. In addition, the Company considers whether the licensee can benefit from a promise for its intended purpose without the receipt of the remaining promise, whether the value of the promise is dependent on the unsatisfied promise, whether there are other vendors that could provide the remaining promise, and whether it is separately identifiable from the remaining promise. For licenses that are combined with other promises, the Company utilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue. The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. The measure of progress, and thereby periods over which revenue should be recognized, are subject to estimates by management and may change over the course of the research and development and licensing agreement. Such a change could have a material impact on the amount of revenue the Company records in future periods. Research, Development and/or Manufacturing Services. The promises under the Company’s agreements may include research and development or manufacturing services to be performed by the Company on behalf of the counterparty. If these services are determined to be distinct from the other promises or performance obligations identified in the arrangement, the Company recognizes the transaction price allocated to these services as revenue over time based on an appropriate measure of progress when the performance by the Company does not create an asset with an alternative use and the Company has an enforceable right to payment for the performance completed to date. If these services are determined not to be distinct from the other promises or performance obligations identified in the arrangement, the Company recognizes the transaction price allocated to the combined performance obligation as the related performance obligations are satisfied. Customer Options. If an arrangement contains customer options, the Company evaluates whether the options are material rights because they allow the customer to acquire additional goods or services for free or at a discount. If the customer options are determined to represent a material right, the material right is recognized as a separate performance obligation at the outset of the arrangement. The Company allocates the transaction price to material rights based on the relative standalone selling price, which is determined using assumptions regarding estimated costs, discount rates, post-option development timeline, the probability of technical and regulatory success and the probability that the customer will exercise the option. Amounts allocated to a material right are not recognized as revenue until, at the earliest, the option is exercised. If the options are deemed not to be a material right, they are excluded as performance obligations at the outset of the arrangement. Milestone Payments. At the inception of each arrangement that includes development milestone payments, the Company evaluates whether the milestones are considered probable of being achieved and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the control of the Company or the licensee, such as regulatory approvals, are not considered probable of being achieved until those approvals are received. The Company evaluates factors such as the scientific, clinical, regulatory, commercial, and other risks that must be overcome to achieve the particular milestone in making this assessment. There is considerable judgment involved in determining whether it is probable that a significant revenue reversal would not occur. At the end of each subsequent reporting period, the Company reevaluates the probability of achievement of all milestones subject to constraint and, if necessary, adjusts its estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect revenues and earnings in the period of adjustment. Royalties. For arrangements that include sales-based royalties which are the result of a customer-vendor relationship and for which the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied or partially satisfied. The Company analyzes its collaboration arrangements to assess whether such arrangements involve joint operating activities performed by parties who are both active participants in the activities and are both exposed to significant risks and rewards dependent on the commercial success of such activities. Such arrangements generally are within the scope of ASC 808, Collaborative Arrangements (ASC 808). While ASC 808 defines collaborative arrangements and provides guidance on income statement presentation, classification, and disclosures related to such arrangements, it does not address recognition and measurement matters, such as (1) determining the appropriate unit of accounting or (2) when the recognition criteria are met. Therefore, the accounting for these arrangements is either based on an analogy to other accounting literature or an accounting policy election by the Company. The Company accounts for certain components of the collaboration agreement that are reflective of a vendor-customer relationship (e.g., licensing arrangement) based on ASC 606. The Company accounts for other components based on a reasonable, rational and consistently applied accounting policy election. Reimbursements from the counter-party that are the result of a collaborative relationship with the counter-party, instead of a customer relationship, such as co-development activities, are recorded as a reduction to research and development expense as the services are performed. For a complete discussion of accounting for revenue from collaborative and other agreements, see Note 9, Revenue. Product sales, net The Company entered into a limited number of arrangements with specialty distributors in the United States to distribute MARGENZA. These arrangements are considered to be contracts with customers and are in the scope of ASC 606. The Company has written contracts with each of its customers that have a single performance obligation - to deliver products upon receipt of a customer order - and these obligations are satisfied when delivery occurs and the customer receives the product. The specialty distributors subsequently resell the Company’s product to healthcare providers. Product revenue is recorded net of applicable reserves for variable consideration, including discounts and other allowances. Shipping and handling costs for product shipments occur prior to the customer obtaining control of the goods and are recorded in cost of sales. Reserves for Variable Consideration. Revenue from product sales is recorded at the net sales price, which includes estimates of variable consideration. Components of variable consideration typically include discounts, product returns, provider chargebacks and discounts and government rebates. Variable consideration is estimated following the expected value method in accordance with ASC 606 and includes such factors as current contractual and statutory requirements, specific known market events and trends, industry data, and forecasted customer buying and payment patterns. The amount of variable consideration that is included in the transaction price may be constrained and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized under the contract will not occur in a future period. Customer Discounts and Service Fees. The Company may provide customers with discounts which are explicitly stated in the contracts. These discounts are recorded as a reduction of revenue in the period the related product revenue is recognized. In addition, these contracts may include written service arrangements whereby the Company pays fees to customers who provide services such as sales order management, data, contract administration and distribution services, at rates which the Company believes to be consistent with fair market value. The Company has determined such services received to date are not distinct from the Company’s sale of products to its customers and, therefore, these payments have been recorded as a reduction of revenue within the statement of operations. Product Returns. Consistent with industry practice, the Company offers the specialty distributors product return rights pursuant to written contracts and/or Company returned goods policies. The Company estimates the amount of its product sales that may be returned by its customers and records an estimated liability and a reduction of revenue in the period the related product revenue is recognized. The Company currently estimates product returns using industry benchmarking as well as other information available, such as visibility into the inventory remaining in the distribution channel, since the Company does not have its own returns experience. The Company's estimates of product returns may be adjusted in the future based on actual returns experience, known or expected changes in the marketplace, or other factors. Provider Chargebacks and Discounts. Chargebacks for fees and discounts to healthcare providers represent the estimated obligations resulting from contractual commitments to sell products to qualified healthcare providers at prices lower than the list prices charged to customers who directly purchase the product from the Company. In such cases, customers charge the Company for the difference between what they pay for the product and the ultimate selling price to the qualified healthcare providers. The reserve for chargebacks is established in the same period that the related revenue is recognized, resulting in a reduction of product revenue. Chargeback amounts are generally determined at the time of resale to the qualified healthcare provider by customers, and the Company generally issues credits for such amounts within a few weeks of the customer’s notification to the Company of the resale. Chargebacks consist of credits the Company expects to issue for units that remain in the distribution channel at each reporting period end that the Company expects will be sold to qualified healthcare providers and chargebacks that customers have claimed, but for which the Company has not yet issued a credit. Government Rebates. The Company is subject to discount and/or rebate obligations under state Medicaid programs, Medicare and contractual agreements with and statutory obligations to certain Federal and State entities. These reserves are recorded in the same period the related revenue is recognized, resulting in a reduction of product revenue. The Company’s liability for these rebates consists of invoices received for claims from prior quarters that have not been paid or for which an invoice has not yet been received, estimates of claims for the current quarter, and estimates of future claims that will be made for product that has been recognized as revenue, but which remains in the distribution channel at the end of each reporting period. Customer discounts are recorded as a reduction of accounts receivable on the consolidated balance sheets. Allowance for product returns, provider chargebacks, government and other rebates and service fees are recorded as a component of accrued expenses and other current liabilities on the consolidated balance sheets. Contract manufacturing revenue The Company enters into agreements with third parties to manufacture their drug substance at its GMP facility. The terms of these arrangements typically include an upfront payment to the Company to reserve manufacturing capacity, scheduled payments during the manufacturing process and reimbursement for materials used to manufacture product. The Company recognizes revenue over time on a straight-line basis as the manufacturing services are performed, as the Company believes that its efforts in providing the manufacturing services are incurred evenly throughout the performance period and therefore straight-line revenue recognition closely approximates the level of effort for the manufacturing services. Variable consideration relating to the reimbursed materials and other reimbursed costs incurred to manufacture product are allocated to the related manufacturing activities and are recognized as revenue as those activities occur. |
Cost of Product Sales and Cost of Manufacturing Services | Cost of Product Sales Cost of product sales relates to sales of MARGENZA. These costs include material, manufacturing and shipping costs, as well as royalties payable on net sales of MARGENZA and inventory reserves. All product costs incurred prior to FDA approval of MARGENZA in December 2020 were expensed as research and development expense. The Company expects cost of product sales to continue to be positively impacted for the next four to five years as the Company sells through inventory that was expensed prior to FDA approval of MARGENZA. Cost of Manufacturing Services Cost of manufacturing services consists of the costs to provide manufacturing services to produce certain bulk drug substance under manufacturing and clinical supply agreements with third parties, including salaries and benefits and related stock-based compensation, materials, overhead and other related costs. |
Research and Development Expenses, Including Clinical Trial Accruals/Expenses | Research and Development Expense, Including Clinical Trial Accruals/Expenses Research and development expenditures are expensed as incurred. Research and development costs primarily consist of employee related expenses, including salaries and benefits, expenses incurred under agreements with contract research organizations (CROs), investigative sites and consultants that conduct the Company's clinical trials, the cost of acquiring and manufacturing clinical trial materials, including costs incurred under agreements with contract manufacturing organizations (CMOs), and other allocated expenses, license fees for and milestone payments related to in-licensed products and technologies, stock-based compensation expense, and costs associated with non-clinical activities and regulatory approvals. Right-to-develop agreements may contain cost-sharing provisions whereby the Company and the collaborator share the cost of research and development activities. Reimbursement of research and development expenses received in connection with these agreements is recorded as a reduction of such expenses. Clinical trial expenses are a significant component of research and development expense, and the Company outsources a significant portion of these costs to third parties. Third party clinical trial expenses include investigator fees, site and patient costs, CRO costs, costs for central laboratory testing, data management and CMO costs. The accrual for site and patient costs includes inputs such as estimates of patient enrollment, patient cycles incurred, clinical site activations, and other pass-through costs. These inputs are required to be estimated due to a lag in receiving the actual clinical information from third parties. Payments for these activities are based on the terms of the individual arrangements, which may differ from the pattern of costs incurred, and are reflected on the consolidated balance sheets as a prepaid asset or accrued expenses. These third party agreements are generally cancellable, and related costs are recorded as research and development expenses as incurred . Non-refundable advance clinical payments for goods or services that will be used or rendered for future research and development activities are recorded as a prepaid asset and recognized as expense as the related goods are delivered or the related services are performed. When evaluating the adequacy of the accrued expenses, management analyzes progress of the studies, including the phase or completion of events, invoices received and contracted costs. Significant judgments and estimates may be made in determining the accrued balances at the end of any reporting period. Actual results could differ from the estimates made. The historical clinical accrual estimates have not been materially different from the actual costs. |
Leases | Leases The Company determines whether an arrangement is or contains a lease at the inception of an arrangement under ASC 842, Leases |
Comprehensive Loss | Comprehensive Loss Comprehensive loss represents net loss adjusted for the change during the periods attributed to unrealized gains and losses on available-for-sale debt securities. |
Net Loss Per Share | Net Loss Per Share |
Recent Accounting Pronouncements | Recent Accounting Pronouncements The Company has implemented all applicable accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Fair Value Measurement Financial Assets | Financial assets measured at fair value on a recurring basis were as follows (in thousands): Fair Value Measurement at December 31, 2023 Total Level 1 Level 2 Assets: Money market funds $ 91,665 $ 91,665 $ — U.S Treasury securities 31,179 — 31,179 Government-sponsored enterprises 45,043 — 45,043 Corporate debt securities 52,627 — 52,627 Total assets measured at fair value (a) $ 220,514 $ 91,665 $ 128,849 Fair Value Measurement at December 31, 2022 Total Level 1 Level 2 Assets: Money market funds $ 41,564 $ 41,564 $ — Government-sponsored enterprise 32,811 — 32,811 Corporate debt securities 17,626 — 17,626 Total assets measured at fair value (b) $ 92,001 $ 41,564 $ 50,437 (a) Total assets measured at fair value at December 31, 2023 includes approximately $91.7 million reported as cash and cash equivalents and $128.8 million reported as marketable securities on the balance sheet. (b) Total assets measured at fair value at December 31, 2022 includes approximately $46.5 million reported as cash and cash equivalents and $45.5 million reported as marketable securities on the balance sheet. |
Summary of Percentage of Customer Concentration | The following table includes those counterparties that represent more than 10% of total revenue earned in the periods indicated: Year Ended December 31, 2023 2022 2021 Incyte 53% 26% 31% McKesson Plasma & Biologics and McKesson Specialty Care Distribution LLC (McKesson) 12% * * ASD Healthcare and Oncology Supply (ASD) 10% * * Provention 10% 43% * Zai Lab Limited (Zai Lab) * 15% 30% I-Mab Biopharma (I-Mab) * * 16% * Amount is less than 10% for the period indicated. The following table includes those counterparties that represent more than 10% of accounts receivable at the date indicated: December 31, 2023 2022 Incyte 25% * Cardinal Health, Inc 18% * McKesson 16% * ASD 15% * Zai Lab 12% * Provention * 84% * Balance is less than 10% as of the date indicated. |
Estimated Useful Lives | Depreciation and amortization are computed using the straight-line method over the following estimated useful lives: Computer equipment 3 years Software 3 years Furniture 10 years Laboratory and office equipment 5 years Leasehold improvements Shorter of lease term or useful life |
Schedule of Stock Options and RSUs Excluded from the Calculation of Net Loss Per Share | The following table presents the number of stock options and RSUs that were excluded from the calculation of net loss per share: Year Ended December 31, 2023 2022 2021 Stock options and RSUs 13,129,251 10,514,013 8,395,421 |
Marketable Securities (Tables)
Marketable Securities (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Available-for-sale | Available-for-sale marketable securities as of December 31, 2023 and 2022 were as follows (in thousands): December 31, 2023 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value U.S. Treasury securities $ 31,177 $ 4 $ (2) $ 31,179 Government-sponsored enterprises 45,041 7 (5) 45,043 Corporate debt securities 52,637 5 (15) 52,627 Total $ 128,855 $ 16 $ (22) $ 128,849 December 31, 2022 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Government-sponsored enterprises $ 32,812 $ 5 $ (7) $ 32,810 Corporate debt securities 12,655 1 (4) 12,652 Total $ 45,467 $ 6 $ (11) $ 45,462 |
Inventory, Net (Tables)
Inventory, Net (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory, Current | The following table sets forth the Company's inventory, net of reserves (in thousands): December 31, 2023 2022 Work in process $ 261 $ 409 Finished goods 960 1,042 Total inventory, net $ 1,221 $ 1,451 |
Schedule of Inventory Reserves | Inventory Reserves (in thousands) Balance at Beginning of Year Additions Charged to Expenses Deductions Balance at End of Year Year Ended December 31, 2023 $ 4,917 $ — $ (1,798) $ 3,119 Year Ended December 31, 2022 $ 2,035 $ 2,882 $ — $ 4,917 Year Ended December 31, 2021 $ — $ 2,035 $ — $ 2,035 |
Property, Equipment and Softw_2
Property, Equipment and Software (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property, equipment and software consists of the following (in thousands): December 31, 2023 2022 Computer equipment $ 3,542 $ 3,489 Software 9,759 9,604 Furniture and office equipment 706 713 Motor vehicles 50 50 Lab equipment 46,452 46,474 Leasehold improvements 48,620 52,974 Construction in progress 1,112 356 Property, equipment and software 110,241 113,660 Less accumulated depreciation and amortization (88,394) (84,085) Property, equipment and software, net $ 21,847 $ 29,575 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule Of Supplemental Balance Sheet Information, Operating Leases | The table below presents supplemental balance sheet information related to operating leases: December 31, 2023 2022 Weighted-average remaining lease term (in years) 11.0 11.1 Weighted-average discount rate 12.0 % 12.0 % |
Lease, Cost | The components of lease cost for the years ended December 31, 2023 and 2022 were as follows (in thousands): December 31, 2023 2022 Operating lease cost $ 7,459 $ 5,597 Variable lease cost 1,316 1,451 Sublease income (1,109) (1,076) Net lease cost $ 7,666 $ 5,972 |
Lessee, Operating Lease, Liability, Maturity | As of December 31, 2023 , the maturities of the Company’s operating lease liabilities were as follows (in thousands): 2024 $ 4,004 2025 5,084 2026 4,209 2027 4,927 2028 6,049 Thereafter 46,003 Total lease payments 70,276 Less: imputed interest (36,306) Total lease liabilities $ 33,970 |
Royalty Monetization Arrangem_2
Royalty Monetization Arrangement (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Royalty Monetization Arrangement [Abstract] | |
Liability Related to Future Royalty | Changes to the liability related to future royalties were as follows for the year ended December 31, 2023 (in thousands): Liability related to future royalties - beginning balance $ — Proceeds from sale of future royalties 150,000 Deferred transaction costs (343) Royalty revenue payable to DRI (157) Interest expense recognized 1,430 Gain on royalty monetization arrangement (150,930) Liability related to future royalties - ending balance $ — |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Stock-Based Compensation Expense | The following stock-based compensation amounts were recognized for the periods indicated (in thousands): Year Ended December 31, 2023 2022 2021 Research and development $ 9,190 $ 10,094 $ 11,337 Selling, general and administrative 9,183 10,344 11,789 Total stock-based compensation expense $ 18,373 $ 20,438 $ 23,126 |
Schedule of Employee Stock Options Award Valuation Assumptions | Year Ended December 31, 2023 2022 2021 Expected dividend yield 0% 0% 0% Expected volatility 76% -96% 88% - 92% 86% - 87% Risk-free interest rate 3.5% - 4.8% 1.4% - 4.0% 0.6% - 1.6% Expected term 5.88 years 5.95 years 6.25 years |
Schedule of Stock Option Activity | The following table summarizes stock option activity for 2023: Shares Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (Years) Aggregate Intrinsic Value (in thousands) Outstanding, December 31, 2022 10,098,929 $ 18.58 6.5 Granted 3,367,777 4.97 Exercised (34,608) 3.73 Forfeited (365,942) 9.49 Expired (842,519) 19.12 Outstanding, December 31, 2023 12,223,637 $ 15.11 6.7 $ 16,974 As of December 31, 2023: Exercisable 7,892,753 $ 18.92 5.6 $ 4,509 Vested and expected to vest 11,346,207 $ 15.59 6.5 $ 14,692 |
Schedule of RSU Activity | The following table summarizes RSU activity for 2023: Shares Weighted-Average Grant Date Fair Value Outstanding, December 31, 2022 415,084 $ 8.83 Granted 707,635 4.88 Vested (135,396) 8.32 Forfeited or expired (81,709) 7.17 Outstanding, December 31, 2023 905,614 $ 5.97 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Components of the Company's Deferred Income Tax Assets (Liabilities) | The significant components of the Company's deferred income tax assets (liabilities) were as follows (in thousands): December 31, 2023 2022 Deferred income tax assets: Federal U.S. net operating loss carryforward $ 140,706 $ 163,071 State net operating loss carryforward 33,350 44,784 Research and development credit, net 68,251 65,084 Orphan drug credit, net 33,330 35,703 Operating lease liabilities 9,078 9,585 Deferred revenue 17,442 — Section 174 deferred tax asset 48,421 43,192 Equity based compensation 16,217 15,228 Other 6,617 4,663 Gross deferred income tax assets 373,412 381,310 Valuation allowance (365,010) (372,267) Net deferred income tax assets 8,402 9,043 Deferred income tax liabilities: Operating lease ROU assets (6,372) (7,522) Prepaid expenditures (2,030) (1,521) Gross deferred income tax liabilities (8,402) (9,043) Net deferred income tax asset/(liability) $ — $ — |
Summary of Valuation Allowance | The activity in the valuation allowance on deferred tax assets was as follows (in thousands): Balance at Beginning of Year Additions Deductions Balance at End of Year Year Ended December 31, 2023 $ 372,267 $ — $ (7,257) $ 365,010 Year Ended December 31, 2022 $ 327,592 $ 44,675 $ — $ 372,267 Year Ended December 31, 2021 $ 263,400 $ 64,192 $ — $ 327,592 |
Reconciliation of Reported Estimated Income Tax Benefit | The reconciliation of the reported estimated income tax benefit to the amount that would result by applying the U.S. federal statutory tax rate to the net income is as follows (in thousands): Year Ended December 31, 2023 2022 2021 United States federal tax at statutory rate $ (1,902) $ (25,149) $ (42,445) State taxes (net of federal benefit) (163) (7,385) (12,806) Deferred income tax adjustments 5,024 308 473 Deferred state blended rate adjustments 1,841 — — Research credit, net (3,168) (4,569) (10,243) Orphan drug credit, net 2,374 (10,846) (1,449) Other permanent items 1,301 1,362 1,199 Equity-based compensation 1,950 1,604 1,079 Change in valuation allowance (7,257) 44,675 64,192 Income tax expense/(benefit) $ — $ — $ — |
Reconciliation of the Beginning and Ending Amount of Gross Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows (in thousands): Year Ended December 31, 2023 2022 2021 Beginning balance $ 7,376 $ 7,197 $ 6,126 Increases for current year tax positions 449 548 965 Increases/(decreases) for prior year tax positions (4) (369) 106 Ending balance $ 7,821 $ 7,376 $ 7,197 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) | 12 Months Ended |
Dec. 31, 2023 Segment | |
Accounting Policies [Abstract] | |
Number of operating segments | 1 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Summary of Fair Value Measurement Financial Asset and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Assets [Abstract] | ||
Cash and cash equivalents | $ 91,700 | $ 46,500 |
Securities | 128,849 | 45,462 |
Investments | 128,849 | 45,462 |
Fair Value, Recurring | ||
Assets [Abstract] | ||
Total assets measured at fair value | 220,514 | 92,001 |
Money market funds | ||
Assets [Abstract] | ||
Cash and cash equivalents | 91,665 | 41,564 |
U.S Treasury securities | ||
Assets [Abstract] | ||
Securities | 31,179 | |
Government-sponsored enterprises | ||
Assets [Abstract] | ||
Securities | 45,043 | 32,811 |
Corporate debt securities | ||
Assets [Abstract] | ||
Securities | 52,627 | 17,626 |
Quoted Prices in Active Markets for Identical Assets, Level 1 | Fair Value, Recurring | ||
Assets [Abstract] | ||
Total assets measured at fair value | 91,665 | 41,564 |
Quoted Prices in Active Markets for Identical Assets, Level 1 | Money market funds | ||
Assets [Abstract] | ||
Cash and cash equivalents | 91,665 | 41,564 |
Quoted Prices in Active Markets for Identical Assets, Level 1 | U.S Treasury securities | ||
Assets [Abstract] | ||
Securities | 0 | |
Quoted Prices in Active Markets for Identical Assets, Level 1 | Government-sponsored enterprises | ||
Assets [Abstract] | ||
Securities | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets, Level 1 | Corporate debt securities | ||
Assets [Abstract] | ||
Securities | 0 | 0 |
Significant Other Observable Inputs, Level 2 | Fair Value, Recurring | ||
Assets [Abstract] | ||
Total assets measured at fair value | 128,849 | 50,437 |
Significant Other Observable Inputs, Level 2 | Money market funds | ||
Assets [Abstract] | ||
Cash and cash equivalents | 0 | 0 |
Significant Other Observable Inputs, Level 2 | U.S Treasury securities | ||
Assets [Abstract] | ||
Securities | 31,179 | |
Significant Other Observable Inputs, Level 2 | Government-sponsored enterprises | ||
Assets [Abstract] | ||
Securities | 45,043 | 32,811 |
Significant Other Observable Inputs, Level 2 | Corporate debt securities | ||
Assets [Abstract] | ||
Securities | $ 52,627 | $ 17,626 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Summary of Collaborators that Represent More Than 10% of Total Revenue Earned and Accounts Receivable (Details) - Customer Concentration Risk | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Sales revenue, net | Incyte Corporation (Incyte) | |||
Concentration Risk [Line Items] | |||
Percentage of significant accounts receivable | 53% | 26% | 31% |
Sales revenue, net | McKesson Plasma & Biologics and McKesson Specialty Care Distribution LLC | |||
Concentration Risk [Line Items] | |||
Percentage of significant accounts receivable | 12% | ||
Sales revenue, net | ASD Healthcare and Oncology Supply | |||
Concentration Risk [Line Items] | |||
Percentage of significant accounts receivable | 10% | ||
Sales revenue, net | Provention Bio, Inc. (Provention) | |||
Concentration Risk [Line Items] | |||
Percentage of significant accounts receivable | 10% | 43% | |
Sales revenue, net | Zai Lab Limited (Zai Lab) | |||
Concentration Risk [Line Items] | |||
Percentage of significant accounts receivable | 15% | 30% | |
Sales revenue, net | I-Mab Biopharma | |||
Concentration Risk [Line Items] | |||
Percentage of significant accounts receivable | 16% | ||
Accounts receivable | Incyte Corporation (Incyte) | |||
Concentration Risk [Line Items] | |||
Percentage of significant accounts receivable | 25% | ||
Accounts receivable | McKesson Plasma & Biologics and McKesson Specialty Care Distribution LLC | |||
Concentration Risk [Line Items] | |||
Percentage of significant accounts receivable | 16% | ||
Accounts receivable | Cardinal Health | |||
Concentration Risk [Line Items] | |||
Percentage of significant accounts receivable | 18% | ||
Accounts receivable | ASD Healthcare and Oncology Supply | |||
Concentration Risk [Line Items] | |||
Percentage of significant accounts receivable | 15% | ||
Accounts receivable | Provention Bio, Inc. (Provention) | |||
Concentration Risk [Line Items] | |||
Percentage of significant accounts receivable | 84% | ||
Accounts receivable | Zai Lab | |||
Concentration Risk [Line Items] | |||
Percentage of significant accounts receivable | 12% |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Estimated Useful Lives (Details) | Dec. 31, 2023 |
Computer equipment | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 3 years |
Software | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 3 years |
Furniture | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 10 years |
Laboratory and office equipment | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 5 years |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Schedule of Antidilutive Securities Excluded from the Calculation of Diluted Loss Per Share (Details) - shares | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Stock options and RSUs | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive stock options | 13,129,251 | 10,514,013 | 8,395,421 |
Marketable Securities (Details)
Marketable Securities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | $ 128,855 | $ 45,467 |
Gross Unrealized Gains | 16 | 6 |
Gross Unrealized Losses | (22) | (11) |
Fair Value | 128,849 | 45,462 |
U.S. Treasury securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 31,177 | |
Gross Unrealized Gains | 4 | |
Gross Unrealized Losses | (2) | |
Fair Value | 31,179 | |
Government-sponsored enterprises | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 45,041 | 32,812 |
Gross Unrealized Gains | 7 | 5 |
Gross Unrealized Losses | (5) | (7) |
Fair Value | 45,043 | 32,810 |
Corporate debt securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 52,637 | 12,655 |
Gross Unrealized Gains | 5 | 1 |
Gross Unrealized Losses | (15) | (4) |
Fair Value | $ 52,627 | $ 12,652 |
Marketable Securities - Availab
Marketable Securities - Available-For-Sale Securities (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |||
Debt Securities, Available-for-sale, Allowance for Credit Loss | $ 0 | $ 0 | |
Interest Income, Other | $ 4,000,000 | $ 1,700,000 | $ 2,000,000 |
Inventory, Net - Schedule of In
Inventory, Net - Schedule of Inventory (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Work in process | $ 261 | $ 409 |
Finished goods | 960 | 1,042 |
Inventory, net | 1,221 | 1,451 |
Inventory valuation reserves | $ 3,100 | $ 4,900 |
Inventory, Net (Details)
Inventory, Net (Details) - SEC Schedule, 12-09, Reserve, Inventory - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items] | ||||
Balance at Beginning of Year | $ 3,119 | $ 4,917 | $ 2,035 | $ 0 |
Additions Charged to Expenses | 0 | 2,882 | 2,035 | |
Deductions | (1,798) | 0 | 0 | |
Balance at End of Year | $ 3,119 | $ 4,917 | $ 2,035 |
Property, Equipment and Softw_3
Property, Equipment and Software (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | |||
Property, equipment and software | $ 110,241 | $ 113,660 | |
Construction in progress | 1,112 | 356 | |
Less accumulated depreciation and amortization | (88,394) | (84,085) | |
Property, equipment and software, net | 21,847 | 29,575 | |
Depreciation expense | 9,600 | 11,900 | $ 11,300 |
Computer equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, equipment and software | 3,542 | 3,489 | |
Software | |||
Property, Plant and Equipment [Line Items] | |||
Property, equipment and software | 9,759 | 9,604 | |
Furniture and office equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, equipment and software | 706 | 713 | |
Motor vehicles | |||
Property, Plant and Equipment [Line Items] | |||
Property, equipment and software | 50 | 50 | |
Lab equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, equipment and software | 46,452 | 46,474 | |
Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property, equipment and software | $ 48,620 | $ 52,974 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Mar. 31, 2022 | |
Lessee, Lease, Description [Line Items] | ||||
Right of use asset and lease liability increase | $ 14,000 | |||
Weighted average lease term (in years) | 11 years | 11 years 1 month 6 days | ||
Discount rate | 12% | 12% | ||
Operating lease payments | $ 5,900 | $ 6,900 | ||
Operating lease, ROU Assets | 23,846 | 27,335 | ||
Operating lease cost | 7,459 | 5,597 | ||
Variable lease cost | 1,316 | 1,451 | ||
Sublease Income | (1,109) | (1,076) | ||
Lease, cost | 7,666 | 5,972 | ||
2024 | 4,004 | |||
2025 | 5,084 | |||
2026 | 4,209 | |||
2027 | 4,927 | |||
2028 | 6,049 | |||
Thereafter | 46,003 | |||
Total lease payments | 70,276 | |||
Less: imputed interest | (36,306) | |||
Operating lease liabilities | 33,970 | |||
Research and development | $ 166,583 | 207,026 | $ 214,577 | |
Minimum | ||||
Lessee, Lease, Description [Line Items] | ||||
Lease renewal term (in years) | 5 years | |||
Synaffix B.V. | ||||
Lessee, Lease, Description [Line Items] | ||||
Potential development and regulatory milestone payments | $ 2,800,000 | |||
Research and development | $ 2,800 | $ 1,000 |
Royalty Monetization Arrangem_3
Royalty Monetization Arrangement (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||
Mar. 08, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Liability related to future royalty [Line Items] | ||||||
Gain on royalty monetization arrangement | $ 50,000 | $ 100,900 | $ 150,930 | $ 0 | $ 0 | |
DRI Healthcare Acquisitions LP (DRI) | ||||||
Liability related to future royalty [Line Items] | ||||||
Upfront payment from DRI Health Trust | $ 100,000 | |||||
Potential proceeds from royalties percent | 50% | |||||
Future revenue from DRI | $ 50,000 | $ 50,000 | ||||
Transaction cost | $ 300 |
Royalty Monetization Arrangem_4
Royalty Monetization Arrangement Rollforward (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Sep. 30, 2023 | Jun. 30, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Royalty Monetization Arrangement [Abstract] | |||||
Liability related to future royalties | $ 0 | $ 0 | |||
Proceeds from sale of future royalties | 150,000 | ||||
Deferred transaction costs | (343) | ||||
Principal payments on royalty monetization arrangement | (157) | 0 | $ 0 | ||
Non-cash interest expense | 1,430 | 0 | 0 | ||
Gain on royalty monetization arrangement | $ (50,000) | $ (100,900) | $ (150,930) | $ 0 | $ 0 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | 14 Months Ended | |||||
Jun. 30, 2021 | Apr. 30, 2021 | Nov. 30, 2020 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2021 | Jun. 15, 2021 | |
Class of Stock [Line Items] | ||||||||
Common stock, shares authorized (in shares) | 125,000,000 | 125,000,000 | ||||||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | ||||||
Proceeds from issuance of common stock, net of offering costs | $ 616 | $ 1,085 | $ 117,818 | |||||
Zai Lab | 2021 Zai Lab Agreements | ||||||||
Class of Stock [Line Items] | ||||||||
Sale of common stock (in dollars per share) | $ 31.30 | |||||||
Proceeds of stock sale | $ 30,000 | |||||||
Undesignated Preferred Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Undesignated preferred stock, shares authorized (in shares) | 5,000,000 | |||||||
Undesignated preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | ||||||
Undesignated preferred stock, shares issued (in shares) | 0 | 0 | ||||||
Undesignated preferred stock, shares outstanding (in shares) | 0 | 0 | ||||||
At The Market Offering | ||||||||
Class of Stock [Line Items] | ||||||||
Common stock maximum amount available for issuance | $ 100,000 | |||||||
Sale of common stock (in shares) | 160,480 | 95,000 | 3,622,186 | |||||
Sale of common stock (in dollars per share) | $ 6.87 | $ 6.60 | ||||||
Proceeds of stock sale | $ 1,100 | $ 600 | $ 98,200 | |||||
Common Stock, Maximum Amount Available For Issuance, Increase | $ 300,000 |
Revenue - Incyte Corporation (D
Revenue - Incyte Corporation (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | 24 Months Ended | |||
Mar. 31, 2023 USD ($) | Oct. 31, 2017 USD ($) | Mar. 31, 2020 USD ($) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2018 USD ($) performanceObligation | |
Collaboration and Other Agreements [Line Items] | |||||||
Revenues | $ 58,749 | $ 151,941 | $ 77,447 | ||||
Incyte MGA012 Agreement | Incyte Corporation (Incyte) | |||||||
Collaboration and Other Agreements [Line Items] | |||||||
Non-refundable upfront payment | $ 150,000 | ||||||
Amounts recognized | $ 15,000 | 115,000 | |||||
Number of performance obligations | performanceObligation | 2 | ||||||
Transaction price | $ 154,000 | ||||||
Clinical trial activities selling price amount | $ 4,000 | ||||||
Minimum | Incyte MGA012 Agreement | Incyte Corporation (Incyte) | |||||||
Collaboration and Other Agreements [Line Items] | |||||||
Potential proceeds from royalties percent | 15% | ||||||
Maximum | Incyte MGA012 Agreement | Incyte Corporation (Incyte) | |||||||
Collaboration and Other Agreements [Line Items] | |||||||
Potential development and regulatory milestone payments | $ 435,000 | ||||||
Potential commercial milestone payments | $ 330,000 | ||||||
Potential proceeds from royalties percent | 24% | ||||||
Revenues From License Agreements | Incyte MGA012 Agreement | Incyte Corporation (Incyte) | |||||||
Collaboration and Other Agreements [Line Items] | |||||||
Revenues | $ 150,000 | 15,000 | 30,000 | 15,000 | |||
Revenues From License Agreements | Incyte MGA012 Supply Agreement | Incyte Corporation (Incyte) | |||||||
Collaboration and Other Agreements [Line Items] | |||||||
Revenues | 1,900 | 700 | 1,500 | ||||
Revenues From License Agreements | Incyte MGA012 Clinical Services | Incyte Corporation (Incyte) | |||||||
Collaboration and Other Agreements [Line Items] | |||||||
Revenues | $ 4,200 | $ 300 | $ 7,800 |
Revenue - Gilead Sciences Inc (
Revenue - Gilead Sciences Inc (Details) - USD ($) $ in Thousands | 7 Months Ended | 12 Months Ended | |||
Oct. 14, 2022 | Jul. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Collaboration and Other Agreements [Line Items] | |||||
Revenues | $ 58,749 | $ 151,941 | $ 77,447 | ||
Gilead | 2022 Gilead Collaboration And License Agreement | |||||
Collaboration and Other Agreements [Line Items] | |||||
Non-refundable upfront payment | $ 60,000 | ||||
Target nomination, option fees and milestone | $ 1,700,000 | ||||
Revenues | 1,500 | 200 | |||
Deferred revenue | 58,300 | 59,800 | |||
Deferred revenue, current | 2,200 | 1,800 | |||
Deferred revenue, noncurrent | 56,100 | $ 58,000 | |||
Gilead | Gilead First Research Program | |||||
Collaboration and Other Agreements [Line Items] | |||||
Revenues | 800 | ||||
Deferred revenue | 14,900 | ||||
Deferred revenue, current | 11,800 | ||||
Deferred revenue, noncurrent | 3,100 | ||||
Revenue, remaining performance obligation, amount | 15,700 | ||||
Opt-in fee | $ 10,000 |
Revenue - Zai Lab (Details)
Revenue - Zai Lab (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Jun. 30, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Jun. 15, 2021 | |
Collaboration and Other Agreements [Line Items] | |||||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |||
Revenues | $ 58,749 | $ 151,941 | $ 77,447 | ||
2021 Zai Lab Agreements | Zai Lab | |||||
Collaboration and Other Agreements [Line Items] | |||||
Non-refundable upfront payment | $ 25,000 | ||||
Proceeds of stock sale | 30,000 | ||||
Sale of common stock (in dollars per share) | $ 31.30 | ||||
Transaction price | $ 40,400 | ||||
Estimated Reimbursement for Research and Development t | 5,000 | ||||
Revenues | $ 0 | $ 16,800 | $ 20,300 | ||
2021 Zai Lab Agreements | Zai Lab | Additional Paid-In Capital | |||||
Collaboration and Other Agreements [Line Items] | |||||
Premium received on stock purchase | $ 10,400 |
Revenue - Provention (Details)
Revenue - Provention (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Mar. 08, 2023 | Nov. 30, 2022 | May 31, 2018 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Collaboration and Other Agreements [Line Items] | ||||||
Revenues | $ 58,749 | $ 151,941 | $ 77,447 | |||
Provention Bio, Inc. (Provention) | ||||||
Collaboration and Other Agreements [Line Items] | ||||||
Transaction price | $ 6,100 | |||||
Stock warrants (in shares) | 2,432,688 | |||||
Provention Bio, Inc. (Provention) | Revenues From License Agreements | ||||||
Collaboration and Other Agreements [Line Items] | ||||||
Revenues | $ 6,100 | |||||
Provention Bio, Inc. (Provention) | Asset Purchase Agreement | ||||||
Collaboration and Other Agreements [Line Items] | ||||||
Revenues | 5,500 | |||||
Provention Bio, Inc. (Provention) | Royalty [Member] | ||||||
Collaboration and Other Agreements [Line Items] | ||||||
Revenues | 300 | |||||
Provention Bio, Inc. (Provention) | Provention PRV3279 | Provention License Agreement | ||||||
Collaboration and Other Agreements [Line Items] | ||||||
Consideration received common stock warrant exercise price (in usd per share) | $ 2.50 | |||||
Potential development and regulatory milestone payments | $ 65,000 | |||||
Potential commercial milestone payments | $ 225,000 | |||||
Provention Bio, Inc. (Provention) | Provention PRV031 | Asset Purchase Agreement | ||||||
Collaboration and Other Agreements [Line Items] | ||||||
Consideration received common stock warrant exercise price (in usd per share) | $ 2.50 | |||||
Potential development and regulatory milestone payments | $ 170,000 | |||||
Potential commercial milestone payments | 225,000 | |||||
Amounts recognized | $ 60,000 | |||||
Potential milestone payment to third parties for intellectual property under agreement | $ 1,300 | |||||
Revenues | 5,600 | $ 60,000 | $ 1,300 | |||
DRI Healthcare Acquisitions LP (DRI) | ||||||
Collaboration and Other Agreements [Line Items] | ||||||
Future revenue from DRI | $ 50,000 | $ 50,000 |
Revenue - Manufacturing Service
Revenue - Manufacturing Service Agreements (Details) - USD ($) $ in Thousands | 7 Months Ended | 12 Months Ended | ||||
Jul. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Jun. 30, 2023 | Jan. 31, 2022 | |
Collaboration and Other Agreements [Line Items] | ||||||
Revenues | $ 58,749 | $ 151,941 | $ 77,447 | |||
Incyte Corporation (Incyte) | RevenuesFromCMOAgreementsMember | ||||||
Collaboration and Other Agreements [Line Items] | ||||||
Non-refundable upfront payment | $ 10,000 | |||||
Total annual fixed payments | 14,400 | |||||
Revenues | 9,700 | 8,700 | ||||
Deferred revenue | 7,000 | 9,600 | ||||
Deferred revenue, current | 8,100 | |||||
Deferred revenue, noncurrent | $ 1,500 | |||||
Incyte Corporation (Incyte) | RevenuesFromCMOAmendmentAgreement | ||||||
Collaboration and Other Agreements [Line Items] | ||||||
Total annual fixed payments | $ 19,500 | |||||
Additional annual fixed payments | 5,100 | |||||
Incyte Corporation (Incyte) | Collaborative Arrangement, Transaction with Party to Collaborative Arrangement | ||||||
Collaboration and Other Agreements [Line Items] | ||||||
Collaborative arrangement, term | 3 years | |||||
Collaborative arrangement, extension term | 1 year | |||||
Provention Bio, Inc. (Provention) | Provention Bio CMO Agreeemnt | ||||||
Collaboration and Other Agreements [Line Items] | ||||||
Revenues | 5,300 | |||||
upfront and fixed payments | $ 4,600 |
Revenue - NIAID Contract (Detai
Revenue - NIAID Contract (Details) | 12 Months Ended | ||
Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Collaboration and Other Agreements [Line Items] | |||
Revenues | $ 58,749,000 | $ 151,941,000 | $ 77,447,000 |
NIAID | |||
Collaboration and Other Agreements [Line Items] | |||
Total potential value | 25,100,000 | ||
RevenuesFromGrantsMember | NIAID | |||
Collaboration and Other Agreements [Line Items] | |||
Number of product candidates to develop | 2 | ||
Revenues | $ 1,600,000 | $ 1,900,000 | $ 1,800,000 |
Stock-based Compensation - Narr
Stock-based Compensation - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||||
May 31, 2017 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | May 31, 2023 | May 18, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Proceeds from issuance of common stock, net of offering costs | $ 616 | $ 1,085 | $ 117,818 | |||
Share-based compensation arrangement by share-based payment award, options, outstanding, number (in shares) | 12,223,637 | 10,098,929 | ||||
Weighted average exercise price (in dollars per share) | $ 15.11 | $ 18.58 | ||||
Employee Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Offering period | 6 months | |||||
Award vesting period | 4 years | |||||
Employee service period | 4 years | |||||
Options granted, maximum term | 10 years | |||||
Restricted Stock Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Outstanding nonvested (in shares) | 905,614 | 415,084 | ||||
2016 Employee Stock Purchase Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based compensation, number of shares authorized (in shares) | 800,000 | |||||
Maximum employee contribution percent | 10% | |||||
Percent of fair market value to purchase shares | 85% | |||||
Common stock purchased by employees (in shares) | 81,541 | |||||
Proceeds from issuance of common stock, net of offering costs | $ 500 | |||||
StockIncentivePlan2023Member | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based compensation, number of shares authorized (in shares) | 4,850,000 | |||||
Share-based compensation arrangement by share-based payment award, options, outstanding, number (in shares) | 418,122 | |||||
Weighted average exercise price (in dollars per share) | $ 5.31 | |||||
StockIncentivePlan2023Member | Restricted Stock Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Outstanding nonvested (in shares) | 51,500 | |||||
Stock Incentive Plan 2013 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based compensation arrangement by share-based payment award, options, outstanding, number (in shares) | 11,805,515 | |||||
Weighted average exercise price (in dollars per share) | $ 15.45 | |||||
Stock Incentive Plan 2013 | Restricted Stock Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Outstanding nonvested (in shares) | 854,114 |
Stock-based Compensation - Stoc
Stock-based Compensation - Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 18,373 | $ 20,438 | $ 23,126 |
Research and development | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | 9,190 | 10,094 | 11,337 |
General and administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 9,183 | $ 10,344 | $ 11,789 |
Stock-based Compensation - Opti
Stock-based Compensation - Option Pricing Assumptions (Details) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected dividend yield | 0% | 0% | 0% |
Expected term | 5 years 10 months 17 days | 5 years 11 months 12 days | 6 years 3 months |
Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility | 76% | 88% | 86% |
Risk-free interest rate | 3.50% | 1.40% | 0.60% |
Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility | 96% | 92% | 87% |
Risk-free interest rate | 4.80% | 4% | 1.60% |
Stock-based Compensation - St_2
Stock-based Compensation - Stock Option and Restricted Stock Unit Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Shares | |||
Beginning Balance (in shares) | 10,098,929 | ||
Granted (in shares) | 3,367,777 | ||
Exercised (in shares) | (34,608) | ||
Forfeited or expired (in shares) | (365,942) | ||
Expired (in shares) | (842,519) | ||
Ending Balance (in shares) | 12,223,637 | 10,098,929 | |
Exercisable (in shares) | 7,892,753 | ||
Vested and expected to vest (in shares) | 11,346,207 | ||
Weighted-Average Exercise Price | |||
Beginning Balance (in dollars per share) | $ 18.58 | ||
Granted (in dollars per share) | 4.97 | ||
Exercised (in dollars per share) | 3.73 | ||
Forfeited or expired (in dollars per share) | 9.49 | ||
Expired (in dollars per share) | 19.12 | ||
Ending Balance (in dollars per share) | 15.11 | $ 18.58 | |
Exercisable (in dollars per share) | 18.92 | ||
Vested and expected to vest (in dollars per share) | $ 15.59 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | |||
Weighted-average remaining contractual term, Outstanding | 6 years 8 months 12 days | 6 years 6 months | |
Weighted-average remaining contractual term, Exercisable | 5 years 7 months 6 days | ||
Weighted-average remaining contractual term, Vested and expected to vest | 6 years 6 months | ||
Aggregate intrinsic value, Outstanding | $ 16,974 | ||
Aggregate intrinsic value, Exercisable | 4,509 | ||
Aggregate intrinsic value, Vested and expected to vest | $ 14,692 | ||
Weighted-Average Grant Date Fair Value | |||
Common stock, shares issued (in shares) | 34,608 | 120,900 | 332,767 |
Cash proceeds from exercise of stock options | $ 100 | $ 200 | $ 5,800 |
Weighted-average grant-date fair value of options granted (in dollars per share) | $ 3.83 | $ 6.84 | $ 15.20 |
Share-based compensation arrangement by share-based payment award, options, exercises in period, intrinsic value | $ 100 | $ 600 | $ 3,300 |
Fair value of shares vested | 16,400 | $ 19,600 | $ 20,200 |
Unrecognized compensation cost related to non-vested stock-based compensation arrangements | $ 19,500 | ||
Unrecognized compensation expense recognition period | 1 year 2 months 12 days | ||
Stock Incentive Plan 2013 | |||
Shares | |||
Ending Balance (in shares) | 11,805,515 | ||
Weighted-Average Exercise Price | |||
Ending Balance (in dollars per share) | $ 15.45 | ||
Restricted Stock Units | |||
Shares | |||
Beginning Balance (in shares) | 415,084 | ||
Granted (in shares) | 707,635 | ||
Exercised (in shares) | (135,396) | ||
Forfeited (in shares) | (81,709) | ||
Ending Balance (in shares) | 905,614 | 415,084 | |
Weighted-Average Grant Date Fair Value | |||
Beginning Balance (in dollars per share) | $ 8.83 | ||
Granted (in dollars per share) | 4.88 | ||
Exercised (in dollars per share) | 8.32 | ||
Forfeited or expired (in dollars per share) | 7.17 | ||
Ending Balance (in dollars per share) | $ 5.97 | $ 8.83 | |
Unrecognized compensation expense recognition period | 1 year 2 months 12 days | ||
Awards granted in period (in shares) | 707,635 | ||
Total unrecognized compensation cost | $ 2,300 | ||
Restricted Stock Units | Stock Incentive Plan 2013 | |||
Shares | |||
Ending Balance (in shares) | 854,114 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Examination [Line Items] | |||
Provision for federal or state income taxes | $ 0 | ||
Gross unrecognized tax benefits | 7,800,000 | $ 7,400,000 | |
Unrecognized interest or penalties | 0 | $ 0 | $ 0 |
U.S. Federal and State | |||
Income Tax Examination [Line Items] | |||
Net operating loss carryforwards | 670,000,000 | ||
U.S. Federal and State | Tax Year 2025 To 2037 | |||
Income Tax Examination [Line Items] | |||
Net operating loss carryforwards | 65,500,000 | ||
U.S. Federal and State | Indefinite | |||
Income Tax Examination [Line Items] | |||
Net operating loss carryforwards | 604,500,000 | ||
U.S. Federal Government | |||
Income Tax Examination [Line Items] | |||
US Federal tax credits carry forward | $ 94,400,000 |
Income Taxes - Components of th
Income Taxes - Components of the Company's Deferred Tax Assets (Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred income tax assets: | ||||
Federal U.S. net operating loss carryforward | $ 140,706 | $ 163,071 | ||
State net operating loss carryforward | 33,350 | 44,784 | ||
Research and development credit, net | 68,251 | 65,084 | ||
Orphan drug credit, net | 33,330 | 35,703 | ||
Operating lease liabilities | 9,078 | 9,585 | ||
Deferred revenue | 17,442 | 0 | ||
Section 174 deferred tax asset | 48,421 | 43,192 | ||
Depreciation | 16,217 | 15,228 | ||
Other | 6,617 | 4,663 | ||
Gross deferred income tax assets | 373,412 | 381,310 | ||
Valuation allowance | (365,010) | (372,267) | $ (327,592) | $ (263,400) |
Net deferred income tax assets | 8,402 | 9,043 | ||
Deferred income tax liabilities: | ||||
Operating lease ROU assets | (6,372) | (7,522) | ||
Prepaid expenditures | (2,030) | (1,521) | ||
Gross deferred income tax liabilities | (8,402) | (9,043) | ||
Net deferred income tax asset/(liability) | $ 0 | $ 0 |
Income Taxes - Valuation Allowa
Income Taxes - Valuation Allowance Activity (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Valuation Allowance [Roll Forward] | |||
Balance at Beginning of Year | $ 372,267 | $ 327,592 | $ 263,400 |
Additions | 0 | 44,675 | 64,192 |
Deductions | (7,257) | 0 | 0 |
Balance at End of Year | $ 365,010 | $ 372,267 | $ 327,592 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Reported Estimated Income Tax Benefit (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||
United States federal tax at statutory rate | $ (1,902) | $ (25,149) | $ (42,445) |
State taxes (net of federal benefit) | (163) | (7,385) | (12,806) |
Deferred income tax adjustments | 5,024 | 308 | 473 |
Deferred state blended rate adjustments | 1,841 | 0 | 0 |
Research credit, net | (3,168) | (4,569) | (10,243) |
Orphan drug credit, net | 2,374 | (10,846) | (1,449) |
Other permanent items | 1,301 | 1,362 | 1,199 |
Equity-based compensation | 1,950 | 1,604 | 1,079 |
Change in valuation allowance | (7,257) | 44,675 | 64,192 |
Income tax expense/(benefit) | $ 0 | $ 0 | $ 0 |
Income Taxes - Reconciliation_2
Income Taxes - Reconciliation of the Beginning and Ending Amount of Gross Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Beginning balance | $ 7,376 | $ 7,197 | $ 6,126 |
Increases for current year tax positions | 449 | 548 | 965 |
Increases/(decreases) for prior year tax positions | (4) | (369) | 106 |
Ending balance | $ 7,821 | $ 7,376 | $ 7,197 |
Employee Benefit Plan (Details)
Employee Benefit Plan (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |||
Eligible age to participate in plan | 21 years | ||
Percentage of employee contribution to salary | 100% | ||
Percentage of employee vested contribution | 100% | ||
Defined contribution plan, employer discretionary contribution amount | $ 2.1 | $ 2.3 | $ 1.6 |