Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Oct. 30, 2017 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | FPRX | |
Entity Registrant Name | FIVE PRIME THERAPEUTICS INC | |
Entity Central Index Key | 1,175,505 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 28,930,241 |
Condensed Balance Sheets
Condensed Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 36,448 | $ 7,653 |
Marketable securities | 284,310 | 414,095 |
Receivables from collaborative partners | 4,356 | 3,959 |
Income tax receivable | 4,670 | |
Prepaid and other current assets | 8,240 | 9,748 |
Total current assets | 333,354 | 440,125 |
Restricted cash | 1,543 | 1,543 |
Property and equipment, net | 22,497 | 6,207 |
Other long-term assets | 23 | 406 |
Total assets | 357,417 | 448,281 |
Current liabilities: | ||
Accounts payable | 2,889 | 334 |
Accrued personnel-related expenses | 6,202 | 7,957 |
Other accrued liabilities | 22,414 | 15,435 |
Deferred revenue, current portion | 12,572 | 14,150 |
Deferred rent, current portion | 1,646 | 865 |
Total current liabilities | 45,723 | 38,741 |
Deferred revenue, long-term portion | 9,437 | 17,856 |
Deferred rent, long-term portion | 16,168 | |
Other long-term liabilities | 109 | |
Commitments | ||
Stockholders' equity: | ||
Common stock, $0.001 par value; 100,000,000 shares authorized, 28,882,490 issued and 28,072,486 outstanding at September 30, 2017. 28,550,006 issued and 27,509,077 outstanding at December 31, 2016 | 28 | 27 |
Additional paid-in capital | 412,678 | 396,635 |
Accumulated other comprehensive loss | (221) | (39) |
Accumulated deficit | (126,396) | (5,048) |
Total stockholders' equity | 286,089 | 391,575 |
Total liabilities and stockholders' equity | $ 357,417 | $ 448,281 |
Condensed Balance Sheets (Paren
Condensed Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2017 | Dec. 31, 2016 |
Statement Of Financial Position [Abstract] | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 28,882,490 | 28,550,006 |
Common stock, shares outstanding | 28,072,486 | 27,509,077 |
Condensed Statements of Operati
Condensed Statements of Operations - USD ($) shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Statement [Abstract] | ||||
Collaboration revenue | $ 8,333,000 | $ 6,680,000 | $ 26,290,000 | $ 22,429,000 |
Operating expenses: | ||||
Research and development | 42,733,000 | 23,890,000 | 118,237,000 | 64,923,000 |
General and administrative | 9,674,000 | 9,146,000 | 29,523,000 | 25,309,000 |
Total operating expenses | 52,407,000 | 33,036,000 | 147,760,000 | 90,232,000 |
Loss from operations | (44,074,000) | (26,356,000) | (121,470,000) | (67,803,000) |
Interest and other income, net | 792,000 | 639,000 | 2,162,000 | 1,821,000 |
Loss before income tax | (43,282,000) | (25,717,000) | (119,308,000) | (65,982,000) |
Income tax (provision) benefit | 0 | 6,303,000 | (1,703,000) | 20,391,000 |
Net loss | $ (43,282,000) | $ (19,414,000) | $ (121,011,000) | $ (45,591,000) |
Basic and diluted net loss per common share | $ (1.54) | $ (0.72) | $ (4.34) | $ (1.70) |
Weighted-average shares used to compute basic and diluted net loss per common share | 28,020 | 27,139 | 27,883 | 26,794 |
Condensed Statements of Compreh
Condensed Statements of Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Statement Of Income And Comprehensive Income [Abstract] | ||||
Net loss | $ (43,282) | $ (19,414) | $ (121,011) | $ (45,591) |
Other comprehensive income (loss): | ||||
Net unrealized gain (loss) on marketable securities, net of tax | 83 | (81) | (182) | 212 |
Comprehensive loss | $ (43,199) | $ (19,495) | $ (121,193) | $ (45,379) |
Condensed Statements of Cash Fl
Condensed Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Operating activities | ||
Net loss | $ (121,011) | $ (45,591) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 1,731 | 1,233 |
Stock-based compensation expense | 26,712 | 22,838 |
Excess tax benefits from employee equity incentive plans | (662) | |
Deferred income taxes | 9,744 | |
Amortization of premiums and discounts on marketable securities | 1,467 | 3,339 |
Loss on disposal of property and equipment | 2 | 9 |
Changes in operating assets and liabilities: | ||
Receivables from collaborative partners | (397) | 1,747 |
Income tax receivable | 4,670 | (3,193) |
Prepaid, other current assets, and other long-term assets | 1,891 | (1,028) |
Accounts payable | 2,555 | (1,366) |
Accrued personnel-related expenses | (1,755) | (947) |
Deferred revenue | (9,997) | (12,554) |
Deferred rent | 2,516 | (576) |
Income tax payable | (41,530) | |
Other accrued liabilities and other long-term liabilities | 6,895 | 3,707 |
Net cash used in operating activities | (84,721) | (64,830) |
Investing activities | ||
Purchases of marketable securities | (318,864) | (410,955) |
Maturities of marketable securities | 447,000 | 391,000 |
Purchases of property and equipment | (3,627) | (2,121) |
Proceeds from disposal of property and equipment | 12 | |
Net cash provided by (used in) investing activities | 124,521 | (22,076) |
Financing activities | ||
Proceeds from issuance of common stock under equity incentive plans | 2,579 | 6,702 |
Repurchase of shares to satisfy tax withholding obligations | (13,584) | (14,054) |
Excess tax benefits from employee equity incentive plans | 662 | |
Net cash used in financing activities | (11,005) | (6,690) |
Net increase (decrease) in cash and cash equivalents | 28,795 | (93,596) |
Cash and cash equivalents at beginning of period | 7,653 | 149,971 |
Cash and cash equivalents at end of period | 36,448 | 56,375 |
Supplemental cash flow information | ||
Cash paid for income taxes | $ 14,701 | |
Non-cash investing activities | ||
Unpaid property and equipment purchases included in accrued liabilities | 1,213 | |
Tenant improvements provided by the landlord | $ 14,324 |
Description of Business
Description of Business | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Description of Business | 1. Description of Business Five Prime Therapeutics, Inc. (we, us, our, or the Company) is a clinical-stage biotechnology company focused on discovering and developing innovative protein therapeutics. We were incorporated in December 2001 in Delaware. Our operations are based in South San Francisco, California and we operate in one segment. Unaudited Interim Financial Information The accompanying financial information as of September 30, 2017 is unaudited. The condensed financial statements included in this report reflect all adjustments (consisting only of normal recurring adjustments) that our management considers necessary for the fair statement of the results of operations for the interim periods covered and of the financial condition of the Company at the date of the interim balance sheet. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles, or GAAP, for interim financial information. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. The results for interim periods are not necessarily indicative of the results for the entire year or any other interim period. The accompanying condensed financial statements and related financial information should be read in conjunction with the audited financial statements and the related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 filed with the U.S. Securities and Exchange Commission. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions about future events that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ materially from those estimates. Fair Value of Financial Instruments We determine the fair value of financial and nonfinancial assets and liabilities using the fair value hierarchy, which describes three levels of inputs that may be used to measure fair value, as follows: Level 1 —Quoted prices in active markets for identical assets or liabilities; Level 2 —Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and Level 3 —Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. We determine the fair value of Level 1 assets using quoted prices in active markets for identical assets. We review trading activity and pricing for Level 2 investments as of each measurement date. Level 2 inputs, which are obtained from various third-party data providers, represent quoted prices for similar assets in active markets and were derived from observable market data, or, if not directly observable, were derived from or corroborated by other observable market data. There were no transfers between Level 1 and Level 2 securities in the periods presented. In certain cases where there is limited activity or less transparency around inputs to valuation, we classify securities as Level 3 within the valuation hierarchy. We do not have any assets or liabilities measured using Level 3 inputs as of September 30, 2017. The following table summarizes our financial instruments that were measured at fair value on a recurring basis by level of input within the fair value hierarchy defined above (in thousands): September 30, 2017 Basis of Fair Value Measurements Total Level 1 Level 2 Level 3 Assets Money market funds $ 15,697 $ 15,697 $ — $ — U.S. Treasury securities 284,310 284,310 — — Certificate of deposit 1,543 — 1,543 — Total cash equivalents and marketable securities $ 301,550 $ 300,007 $ 1,543 $ — December 31, 2016 Basis of Fair Value Measurements Total Level 1 Level 2 Level 3 Assets Money market funds $ 432 $ 432 $ — $ — U.S. Treasury securities 414,095 414,095 — — Certificate of deposit 1,543 — 1,543 — Total cash equivalents and marketable securities $ 416,070 $ 414,527 $ 1,543 $ — Net Loss Per Share of Common Stock We compute basic net loss per common share by dividing net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period. We excluded the following securities from the calculation of diluted net loss per share as the effect would have been antidilutive (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Options to purchase common stock 3,848 3,100 3,813 2,815 Restricted stock awards (RSAs) 850 1,250 909 1,358 4,698 4,350 4,722 4,173 Accounting Pronouncements Adopted in 2017 In March 2016, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, 2016-09, Improvements to Employee Share-Based Payment Accounting Accounting Pronouncements Not Yet Adopted In May 2014, FASB issued ASU 2014-09, Revenue from Contracts with Customers: Topic 606 In March, April, May and December 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations , ASU 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing , ASU 2016-12, Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients to provide supplemental adoption guidance and clarification to ASU 2014-09 and ASU 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers , respectively. The effective date for these new standards is the same as the effective date and transition requirements for ASU 2014-09. We expect to adopt ASU 2014-09 in the first quarter of 2018 using the modified retrospective method. Our adoption of ASU 2014-09 may have a material effect on our financial statements. To date, we have derived our revenues from license and collaboration agreements. The consideration we are eligible to receive under these agreements includes upfront payments, research and development funding, milestone payments and royalties. Each license and collaboration agreement is unique and will need to be assessed separately under the five-step process set forth under the new standard. We are currently assessing our active license and collaboration agreements. We expect that our evaluation of the accounting for license and collaboration agreements under the new revenue standard could identify material changes from the current accounting treatment. ASU 2014-09 differs from the current accounting standard in many respects, such as in the accounting for variable consideration, including milestone payments. Under our current accounting policy, we recognize milestone revenue using the milestone method specified in ASC 605-28, which generally results in the recognition of the milestone payment as revenue in the period that the milestone is achieved. However, under the new accounting standard, it is possible to start to recognize milestone revenue before the milestone is achieved, subject to management’s assessment of whether it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. In addition, the current accounting standards include a presumption that revenue from up-front non-refundable fees would be recognized ratably over the performance period, unless another attribution method was determined to more closely approximate the delivery of the goods or services to the customer. The new accounting standard does not have a presumption that entities would default to a ratable attribution approach and will require entities to determine an appropriate attribution method using either output or input methods. As such, the amount and timing of revenue recognition for our license and collaboration agreements may change under the new revenue standard. In February 2016, FASB issued ASU 2016-02, Leases all annual and interim reporting periods thereafter. E In May 2017, FASB issued ASU 2017-09, Compensation-Stock Compensation (Topic 718) – Scope of Modification Accounting |
Cash Equivalents and Marketable
Cash Equivalents and Marketable Securities | 9 Months Ended |
Sep. 30, 2017 | |
Cash And Cash Equivalents [Abstract] | |
Cash Equivalents and Marketable Securities | 3. Cash Equivalents and Marketable Securities The following table summarizes our cash equivalents and marketable securities (in thousands): September 30, 2017 Amortized Unrealized Unrealized Estimated Cost Basis Gains Losses Fair Value Money market funds $ 15,697 $ — $ — $ 15,697 U.S. Treasury securities 284,532 — (222 ) 284,310 300,229 — (222 ) 300,007 Less: cash equivalents (15,697 ) — — (15,697 ) Total marketable securities $ 284,532 $ — $ (222 ) $ 284,310 December 31, 2016 Amortized Unrealized Unrealized Estimated Cost Basis Gains Losses Fair Value Money market funds $ 432 $ — $ — $ 432 U.S. Treasury securities 414,134 54 (93 ) 414,095 414,566 54 (93 ) 414,527 Less: cash equivalents (432 ) — — (432 ) Total marketable securities $ 414,134 $ 54 $ (93 ) $ 414,095 As of September 30, 2017, the amortized cost and estimated fair value of our available-for-sale securities by contractual maturity are shown below (in thousands): Amortized Estimated Cost Fair Value Debt securities maturing: In one year or less $ 243,173 $ 242,995 In one to two years 41,359 41,315 Total marketable securities $ 284,532 $ 284,310 We determined that the gross unrealized losses on our marketable securities as of September 30, 2017 were temporary in nature. We currently do not intend to sell these securities prior to maturity and do not consider these investments to be other-than-temporarily impaired at September 30, 2017. There were no sales of available-for-sale securities in any of the periods presented. |
Equity Incentive Plans
Equity Incentive Plans | 9 Months Ended |
Sep. 30, 2017 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Equity Incentive Plans | 4. Equity Incentive Plans The following table summarizes option activity under our equity incentive plans and related information: Options Outstanding Weighted Weighted Average Average Remaining Number of Exercise Price Contractual Shares Per Share Term (years) Balance at December 31, 2016 3,454,339 $ 26.80 Options granted 803,050 $ 40.87 Options exercised (149,079 ) $ 12.14 Options forfeited (245,829 ) $ 38.44 Options expired (4,160 ) $ 34.67 Balance at September 30, 2017 3,858,321 $ 29.55 Options exercisable as of September 30, 2017 1,901,281 $ 21.41 5.86 We have granted RSAs to certain of our employees, some of which are subject to performance conditions. RSAs are share awards that entitle the holder to receive freely tradable shares of our common stock upon vesting and are not forfeitable once fully vested. We based the fair value of RSAs on the closing sale price of our common stock on the grant date. For awards subject to performance conditions, we recognize stock-based compensation expense using the accelerated attribution recognition method when it is probable that the performance condition will be achieved. The following table summarizes RSA activity under our 2013 Omnibus Incentive Plan and related information: RSAs Outstanding Weighted-Average Number Grant-Date of Shares Fair Value Unvested balance at December 31, 2016 1,040,929 $ 28.84 RSAs granted 581,505 $ 41.05 RSAs vested (697,719 ) $ 23.13 RSAs forfeited (113,111 ) $ 43.13 Unvested balance at September 30, 2017 811,604 $ 40.51 As of September 30, 2017, there were 1,461,211 shares of common stock available for future issuance under our 2013 Omnibus Incentive Plan. Stock-Based Compensation Total stock-based compensation expense recognized was as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Research and development $ 3,411 $ 4,500 $ 14,627 $ 12,643 General and administrative 3,653 3,811 12,085 10,195 Total $ 7,064 $ 8,311 $ 26,712 $ 22,838 We estimated the fair value of stock options using the Black-Scholes option-pricing model based on the date of grant of such stock option with the following assumptions: Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Expected term (years) 6.3 6.0-6.3 5.5-6.3 5.5-6.3 Expected volatility 66% 70% 66-68% 70-74% Risk-free interest rate 1.9% 1.3% 1.9-2.1 1.3-1.5% Expected dividend yield 0% 0% 0% 0% As of September 30, 2017, we had $42.3 million of total unrecognized compensation expense related to unvested employee and director stock options that we expect to recognize over a weighted-average period of 2.6 years. Additionally, we had $25.5 million of total unrecognized compensation expense related to employee and director RSAs that we expect to recognize over a weighted-average period of 2.1 years. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 5. Income Taxes We recorded a provision for income taxes of $0 and $1.7 million for the three and nine months ended September 30, 2017, respectively. In the three months ended June 30, 2017, we recorded a $1.7 million provision for income taxes based on our ongoing discussions with the Internal Revenue Service as to our tentative net operating loss carryback refund claim filed in March 2017. We realized an income tax benefit of $6.3 million and $20.4 million for the three and nine months ended September 30, 2016, respectively. This income tax benefit represented our ability to recover taxes accrued in 2015 based on existing tax law that allowed us to carryback our 2016 tax losses and/or credits to recover prior taxes. The income tax benefit was based on the annual effective tax rate method and considered our forecasted 2016 pre-tax losses reduced by non-deductible stock based compensation expenses and other immaterial non-deductible permanent items. In addition, as a result of the forecasted loss, the income tax benefit was decreased by a valuation allowance recorded against certain deferred tax assets due to the uncertainty surrounding the realization of such assets in the future. After the carryback of our full year 2016 net operating losses to 2015, we maximized our ability to obtain a refund of prior income taxes paid. |
Summary of Significant Accoun12
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions about future events that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ materially from those estimates. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments We determine the fair value of financial and nonfinancial assets and liabilities using the fair value hierarchy, which describes three levels of inputs that may be used to measure fair value, as follows: Level 1 —Quoted prices in active markets for identical assets or liabilities; Level 2 —Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and Level 3 —Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. We determine the fair value of Level 1 assets using quoted prices in active markets for identical assets. We review trading activity and pricing for Level 2 investments as of each measurement date. Level 2 inputs, which are obtained from various third-party data providers, represent quoted prices for similar assets in active markets and were derived from observable market data, or, if not directly observable, were derived from or corroborated by other observable market data. There were no transfers between Level 1 and Level 2 securities in the periods presented. In certain cases where there is limited activity or less transparency around inputs to valuation, we classify securities as Level 3 within the valuation hierarchy. We do not have any assets or liabilities measured using Level 3 inputs as of September 30, 2017. The following table summarizes our financial instruments that were measured at fair value on a recurring basis by level of input within the fair value hierarchy defined above (in thousands): September 30, 2017 Basis of Fair Value Measurements Total Level 1 Level 2 Level 3 Assets Money market funds $ 15,697 $ 15,697 $ — $ — U.S. Treasury securities 284,310 284,310 — — Certificate of deposit 1,543 — 1,543 — Total cash equivalents and marketable securities $ 301,550 $ 300,007 $ 1,543 $ — December 31, 2016 Basis of Fair Value Measurements Total Level 1 Level 2 Level 3 Assets Money market funds $ 432 $ 432 $ — $ — U.S. Treasury securities 414,095 414,095 — — Certificate of deposit 1,543 — 1,543 — Total cash equivalents and marketable securities $ 416,070 $ 414,527 $ 1,543 $ — |
Net Loss Per Share of Common Stock | Net Loss Per Share of Common Stock We compute basic net loss per common share by dividing net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period. We excluded the following securities from the calculation of diluted net loss per share as the effect would have been antidilutive (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Options to purchase common stock 3,848 3,100 3,813 2,815 Restricted stock awards (RSAs) 850 1,250 909 1,358 4,698 4,350 4,722 4,173 |
Accounting Pronouncements Adopted in 2017 | Accounting Pronouncements Adopted in 2017 In March 2016, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, 2016-09, Improvements to Employee Share-Based Payment Accounting |
Accounting Pronouncements Not Yet Adopted | Accounting Pronouncements Not Yet Adopted In May 2014, FASB issued ASU 2014-09, Revenue from Contracts with Customers: Topic 606 In March, April, May and December 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations , ASU 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing , ASU 2016-12, Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients to provide supplemental adoption guidance and clarification to ASU 2014-09 and ASU 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers , respectively. The effective date for these new standards is the same as the effective date and transition requirements for ASU 2014-09. We expect to adopt ASU 2014-09 in the first quarter of 2018 using the modified retrospective method. Our adoption of ASU 2014-09 may have a material effect on our financial statements. To date, we have derived our revenues from license and collaboration agreements. The consideration we are eligible to receive under these agreements includes upfront payments, research and development funding, milestone payments and royalties. Each license and collaboration agreement is unique and will need to be assessed separately under the five-step process set forth under the new standard. We are currently assessing our active license and collaboration agreements. We expect that our evaluation of the accounting for license and collaboration agreements under the new revenue standard could identify material changes from the current accounting treatment. ASU 2014-09 differs from the current accounting standard in many respects, such as in the accounting for variable consideration, including milestone payments. Under our current accounting policy, we recognize milestone revenue using the milestone method specified in ASC 605-28, which generally results in the recognition of the milestone payment as revenue in the period that the milestone is achieved. However, under the new accounting standard, it is possible to start to recognize milestone revenue before the milestone is achieved, subject to management’s assessment of whether it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. In addition, the current accounting standards include a presumption that revenue from up-front non-refundable fees would be recognized ratably over the performance period, unless another attribution method was determined to more closely approximate the delivery of the goods or services to the customer. The new accounting standard does not have a presumption that entities would default to a ratable attribution approach and will require entities to determine an appropriate attribution method using either output or input methods. As such, the amount and timing of revenue recognition for our license and collaboration agreements may change under the new revenue standard. In February 2016, FASB issued ASU 2016-02, Leases all annual and interim reporting periods thereafter. E In May 2017, FASB issued ASU 2017-09, Compensation-Stock Compensation (Topic 718) – Scope of Modification Accounting |
Summary of Significant Accoun13
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Summary of Financial Instruments Measured at Fair Value | The following table summarizes our financial instruments that were measured at fair value on a recurring basis by level of input within the fair value hierarchy defined above (in thousands): September 30, 2017 Basis of Fair Value Measurements Total Level 1 Level 2 Level 3 Assets Money market funds $ 15,697 $ 15,697 $ — $ — U.S. Treasury securities 284,310 284,310 — — Certificate of deposit 1,543 — 1,543 — Total cash equivalents and marketable securities $ 301,550 $ 300,007 $ 1,543 $ — December 31, 2016 Basis of Fair Value Measurements Total Level 1 Level 2 Level 3 Assets Money market funds $ 432 $ 432 $ — $ — U.S. Treasury securities 414,095 414,095 — — Certificate of deposit 1,543 — 1,543 — Total cash equivalents and marketable securities $ 416,070 $ 414,527 $ 1,543 $ — |
Securities Excluded from Calculation of Diluted Net Loss Per Share | We excluded the following securities from the calculation of diluted net loss per share as the effect would have been antidilutive (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Options to purchase common stock 3,848 3,100 3,813 2,815 Restricted stock awards (RSAs) 850 1,250 909 1,358 4,698 4,350 4,722 4,173 |
Cash Equivalents and Marketab14
Cash Equivalents and Marketable Securities (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Cash And Cash Equivalents [Abstract] | |
Summary of Cash Equivalents and Marketable Securities | The following table summarizes our cash equivalents and marketable securities (in thousands): September 30, 2017 Amortized Unrealized Unrealized Estimated Cost Basis Gains Losses Fair Value Money market funds $ 15,697 $ — $ — $ 15,697 U.S. Treasury securities 284,532 — (222 ) 284,310 300,229 — (222 ) 300,007 Less: cash equivalents (15,697 ) — — (15,697 ) Total marketable securities $ 284,532 $ — $ (222 ) $ 284,310 December 31, 2016 Amortized Unrealized Unrealized Estimated Cost Basis Gains Losses Fair Value Money market funds $ 432 $ — $ — $ 432 U.S. Treasury securities 414,134 54 (93 ) 414,095 414,566 54 (93 ) 414,527 Less: cash equivalents (432 ) — — (432 ) Total marketable securities $ 414,134 $ 54 $ (93 ) $ 414,095 |
Schedule of Amortized Cost and Estimated Fair Value of Available-for-Sale Securities by Contractual Maturity | As of September 30, 2017, the amortized cost and estimated fair value of our available-for-sale securities by contractual maturity are shown below (in thousands): Amortized Estimated Cost Fair Value Debt securities maturing: In one year or less $ 243,173 $ 242,995 In one to two years 41,359 41,315 Total marketable securities $ 284,532 $ 284,310 |
Equity Incentive Plans (Tables)
Equity Incentive Plans (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Schedule of Option Activity under Equity Incentive Plans and Related Information | The following table summarizes option activity under our equity incentive plans and related information: Options Outstanding Weighted Weighted Average Average Remaining Number of Exercise Price Contractual Shares Per Share Term (years) Balance at December 31, 2016 3,454,339 $ 26.80 Options granted 803,050 $ 40.87 Options exercised (149,079 ) $ 12.14 Options forfeited (245,829 ) $ 38.44 Options expired (4,160 ) $ 34.67 Balance at September 30, 2017 3,858,321 $ 29.55 Options exercisable as of September 30, 2017 1,901,281 $ 21.41 5.86 |
Schedule of Restricted Stock Award Activity under 2013 Omnibus Incentive Plan and Related Information | The following table summarizes RSA activity under our 2013 Omnibus Incentive Plan and related information: RSAs Outstanding Weighted-Average Number Grant-Date of Shares Fair Value Unvested balance at December 31, 2016 1,040,929 $ 28.84 RSAs granted 581,505 $ 41.05 RSAs vested (697,719 ) $ 23.13 RSAs forfeited (113,111 ) $ 43.13 Unvested balance at September 30, 2017 811,604 $ 40.51 |
Schedule of Stock-Based Compensation Expenses Recognized | Total stock-based compensation expense recognized was as follows (in thousands) Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Research and development $ 3,411 $ 4,500 $ 14,627 $ 12,643 General and administrative 3,653 3,811 12,085 10,195 Total $ 7,064 $ 8,311 $ 26,712 $ 22,838 |
Schedule of Stock Options Weighted-Average Assumptions | We estimated the fair value of stock options using the Black-Scholes option-pricing model based on the date of grant of such stock option with the following assumptions: Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Expected term (years) 6.3 6.0-6.3 5.5-6.3 5.5-6.3 Expected volatility 66% 70% 66-68% 70-74% Risk-free interest rate 1.9% 1.3% 1.9-2.1 1.3-1.5% Expected dividend yield 0% 0% 0% 0% |
Description of Business - Addit
Description of Business - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2017Segment | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Number of operating segment | 1 |
Summary of Significant Accoun17
Summary of Significant Accounting Policies - Summary of Financial Instruments Measured at Fair Value (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Assets | ||
Total cash equivalents and marketable securities | $ 301,550 | $ 416,070 |
Money market funds [Member] | ||
Assets | ||
Cash equivalents | 15,697 | 432 |
Certificate of deposit [Member] | ||
Assets | ||
Cash equivalents | 1,543 | 1,543 |
Level 1 [Member] | ||
Assets | ||
Total cash equivalents and marketable securities | 300,007 | 414,527 |
Level 1 [Member] | Money market funds [Member] | ||
Assets | ||
Cash equivalents | 15,697 | 432 |
Level 2 [Member] | ||
Assets | ||
Total cash equivalents and marketable securities | 1,543 | 1,543 |
Level 2 [Member] | Certificate of deposit [Member] | ||
Assets | ||
Cash equivalents | 1,543 | 1,543 |
U.S. Treasury securities [Member] | ||
Assets | ||
U.S. Treasury securities | 284,310 | 414,095 |
U.S. Treasury securities [Member] | Level 1 [Member] | ||
Assets | ||
U.S. Treasury securities | $ 284,310 | $ 414,095 |
Summary of Significant Accoun18
Summary of Significant Accounting Policies - Securities Excluded from Calculation of Diluted Net Loss Per Share (Detail) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Securities excluded from calculation of diluted net loss per share | 4,698 | 4,350 | 4,722 | 4,173 |
Options to purchase common stock [Member] | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Securities excluded from calculation of diluted net loss per share | 3,848 | 3,100 | 3,813 | 2,815 |
Restricted stock awards (RSAs) [Member] | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Securities excluded from calculation of diluted net loss per share | 850 | 1,250 | 909 | 1,358 |
Summary of Significant Accoun19
Summary of Significant Accounting Policies - Additional Information (Detail) - ASU 2016-09 [Member] | Jan. 01, 2017USD ($) |
Summary Of Significant Accounting Policies [Line Items] | |
Decrease to retained earnings | $ 337,000 |
Increase in deferred tax assets which is fully offset by valuation allowance | $ 3,100,000 |
Cash Equivalents and Marketab20
Cash Equivalents and Marketable Securities - Summary of Cash Equivalents and Marketable Securities (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost Basis | $ 284,532 | $ 414,134 |
Unrealized Gains | 54 | |
Unrealized Losses | (222) | (93) |
Estimated Fair Value | 284,310 | 414,095 |
Money market funds [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost Basis | 15,697 | 432 |
Estimated Fair Value | 15,697 | 432 |
U.S. Treasury securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost Basis | 284,532 | 414,134 |
Unrealized Gains | 54 | |
Unrealized Losses | (222) | (93) |
Estimated Fair Value | 284,310 | 414,095 |
Marketable securities including cash equivalents [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost Basis | 300,229 | 414,566 |
Unrealized Gains | 54 | |
Unrealized Losses | (222) | (93) |
Estimated Fair Value | 300,007 | 414,527 |
Cash equivalents [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost Basis | (15,697) | (432) |
Estimated Fair Value | $ (15,697) | $ (432) |
Cash Equivalents and Marketab21
Cash Equivalents and Marketable Securities - Schedule of Amortized Cost and Estimated Fair Value of Available-for-Sale Securities by Contractual Maturity (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost Basis | $ 284,532 | $ 414,134 |
Total marketable securities, Estimated Fair Value | 284,310 | 414,095 |
U.S. Treasury securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost, In one year or less | 243,173 | |
Amortized Cost, In one to two years | 41,359 | |
Amortized Cost Basis | 284,532 | 414,134 |
Estimated Fair Value, In one year or less | 242,995 | |
Estimated Fair Value, In one to two years | 41,315 | |
Total marketable securities, Estimated Fair Value | $ 284,310 | $ 414,095 |
Cash Equivalents and Marketab22
Cash Equivalents and Marketable Securities - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2017USD ($) | |
Investments Debt And Equity Securities [Abstract] | |
Sales of available-for-sale securities | $ 0 |
Equity Incentive Plans - Schedu
Equity Incentive Plans - Schedule of Option Activity under Equity Incentive Plans and Related Information (Detail) | 9 Months Ended |
Sep. 30, 2017$ / sharesshares | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Number of Shares, Beginning balance | shares | 3,454,339 |
Number of Shares, Options granted | shares | 803,050 |
Number of Shares, Options exercised | shares | (149,079) |
Number of Shares, Options forfeited | shares | (245,829) |
Number of Shares, Options expired | shares | (4,160) |
Number of Shares, Ending balance | shares | 3,858,321 |
Number of Shares, Options exercisable | shares | 1,901,281 |
Weighted-Average Exercise Price Per Share, Options beginning balance | $ / shares | $ 26.80 |
Weighted-Average Exercise Price Per Share, Options granted | $ / shares | 40.87 |
Weighted-Average Exercise Price Per Share, Options exercised | $ / shares | 12.14 |
Weighted-Average Exercise Price Per Share, Options forfeited | $ / shares | 38.44 |
Weighted-Average Exercise Price Per Share, Options expired | $ / shares | 34.67 |
Weighted-Average Exercise Price Per Share, Options ending balance | $ / shares | 29.55 |
Weighted-Average Exercise Price Per Share, Options exercisable | $ / shares | $ 21.41 |
Weighted Average Remaining Contractual Term, Options exercisable | 5 years 10 months 10 days |
Equity Incentive Plans - Sche24
Equity Incentive Plans - Schedule of Restricted Stock Award Activity under 2013 Omnibus Incentive Plan and Related Information (Detail) - Restricted Stock Awards [Member] | 9 Months Ended |
Sep. 30, 2017$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Number of Shares, Unvested, beginning balance | shares | 1,040,929 |
Number of Shares, Granted | shares | 581,505 |
Number of Shares, Vested | shares | (697,719) |
Number of Shares, Forfeited | shares | (113,111) |
Number of Shares, Unvested, Ending balance | shares | 811,604 |
Weighted-Average Grant-Date Fair Value, Unvested, Beginning balance | $ / shares | $ 28.84 |
Weighted-Average Grant-Date Fair Value, Granted | $ / shares | 41.05 |
Weighted-Average Grant-Date Fair Value, Vested | $ / shares | 23.13 |
Weighted-Average Grant-Date Fair Value, Forfeited | $ / shares | 43.13 |
Weighted-Average Grant-Date Fair Value, Unvested, Ending balance | $ / shares | $ 40.51 |
Equity Incentive Plans - Additi
Equity Incentive Plans - Additional Information (Detail) $ in Millions | 9 Months Ended |
Sep. 30, 2017USD ($)shares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Total unrecognized compensation expense related to unvested employee and director stock options | $ 42.3 |
Unrecognized compensation expense expected to recognize, weighted-average period | 2 years 7 months 6 days |
Restricted Stock Awards [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Unrecognized compensation expense expected to recognize, weighted-average period | 2 years 1 month 6 days |
Total unrecognized compensation expense related to employee and director RSAs | $ 25.5 |
2013 Omnibus Incentive Plan [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Number of shares of common stock reserved for future issuance | shares | 1,461,211 |
Equity Incentive Plans - Sche26
Equity Incentive Plans - Schedule of Stock-Based Compensation Expenses Recognized (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense recognized | $ 7,064 | $ 8,311 | $ 26,712 | $ 22,838 |
Research and development [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense recognized | 3,411 | 4,500 | 14,627 | 12,643 |
General and administrative [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense recognized | $ 3,653 | $ 3,811 | $ 12,085 | $ 10,195 |
Equity Incentive Plans - Sche27
Equity Incentive Plans - Schedule of Stock Options Assumptions (Detail) - Options [Member] | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Expected term (years) | 6 years 3 months 19 days | |||
Expected volatility | 66.00% | 70.00% | ||
Risk-free interest rate | 1.90% | 1.30% | ||
Risk-free interest rate, minimum | 1.90% | 1.30% | ||
Risk-free interest rate, maximum | 2.10% | 1.50% | ||
Expected dividend yield | 0.00% | 0.00% | 0.00% | 0.00% |
Minimum [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Expected term (years) | 6 years | 5 years 6 months | 5 years 6 months | |
Expected volatility | 66.00% | 70.00% | ||
Maximum [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Expected term (years) | 6 years 3 months 19 days | 6 years 3 months 19 days | 6 years 3 months 19 days | |
Expected volatility | 68.00% | 74.00% |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2017 | Jun. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | |||||
Income tax provision (benefit) | $ 0 | $ 1,700,000 | $ (6,303,000) | $ 1,703,000 | $ (20,391,000) |