Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Jan. 31, 2022 | Jun. 30, 2021 | |
Document and Entity Information | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2021 | ||
Document Transition Report | false | ||
Entity File Number | 001-37372 | ||
Entity Registrant Name | Collegium Pharmaceutical, Inc. | ||
Entity Incorporation, State or Country Code | VA | ||
Entity Tax Identification Number | 03-0416362 | ||
Entity Address, Address Line One | 100 Technology Center Drive | ||
Entity Address, City or Town | Stoughton | ||
Entity Address, State or Province | MA | ||
Entity Address, Postal Zip Code | 02072 | ||
City Area Code | 781 | ||
Local Phone Number | 713-3699 | ||
Title of 12(b) Security | Common stock | ||
Trading Symbol | COLL | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 831 | ||
Entity Common Stock, Shares Outstanding | 33,377,788 | ||
Auditor Firm ID | 34 | ||
Auditor Name | Deloitte & Touche LLP | ||
Auditor Location | Boston, Massachusetts | ||
Entity Central Index Key | 0001267565 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Current assets | ||
Cash and cash equivalents | $ 186,426 | $ 174,116 |
Accounts receivable, net | 105,844 | 83,320 |
Inventory | 17,394 | 15,614 |
Prepaid expenses and other current assets | 5,879 | 4,838 |
Total current assets | 315,543 | 277,888 |
Property and equipment, net | 19,491 | 18,988 |
Operating lease assets | 7,644 | 8,391 |
Intangible asset, net | 268,723 | 335,904 |
Restricted cash | 2,547 | 2,547 |
Deferred tax assets | 78,042 | |
Other noncurrent assets | 87 | 123 |
Total assets | 692,077 | 643,841 |
Current liabilities | ||
Accounts payable | 4,189 | 10,016 |
Accrued expenses | 29,214 | 24,656 |
Accrued rebates, returns and discounts | 196,996 | 156,554 |
Current portion of term notes payable | 48,353 | 47,495 |
Current portion of operating lease liabilities | 814 | 730 |
Total current liabilities | 279,566 | 239,451 |
Term notes payable, net of current portion | 61,666 | 110,019 |
Convertible senior notes | 139,966 | 99,575 |
Operating lease liabilities, net of current portion | 7,951 | 8,765 |
Total liabilities | 489,149 | 457,810 |
Commitments and contingencies (see Note 11) | ||
Shareholders' equity: | ||
Preferred stock, $0.001 par value; authorized shares - 5,000,000 | ||
Common stock, $0.001 par value; authorized shares - 100,000,000; 35,806,119 issued and 33,655,402 outstanding shares at December 31, 2021 and 34,612,054 issued and outstanding at December 31, 2020 | 36 | 35 |
Additional paid-in capital | 502,095 | 519,143 |
Accumulated deficit | (256,342) | (333,147) |
Treasury stock, at cost; 2,150,717 shares at December 31, 2021 and none at December 31, 2020 | (42,861) | |
Total shareholders' equity | 202,928 | 186,031 |
Total liabilities and shareholders' equity | $ 692,077 | $ 643,841 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2021 | Dec. 31, 2020 |
CONSOLIDATED BALANCE SHEETS | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, authorized shares | 5,000,000 | 5,000,000 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized shares | 100,000,000 | 100,000,000 |
Common stock, issued shares | 35,806,119 | 34,612,054 |
Common stock, outstanding shares | 33,655,402 | 34,612,054 |
Treasury stock, shares | 2,150,717 | 0 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Revenues | |||
Product revenues, net | $ 276,868 | $ 310,016 | $ 296,701 |
Revenue from Contract with Customer, Product and Service [Extensible List] | us-gaap:ProductMember | us-gaap:ProductMember | us-gaap:ProductMember |
Cost of product revenues | |||
Cost of product revenues (excluding intangible asset amortization) | $ 59,070 | $ 69,500 | $ 178,908 |
Cost, Product and Service [Extensible List] | us-gaap:ProductMember | us-gaap:ProductMember | us-gaap:ProductMember |
Intangible asset amortization | $ 67,181 | $ 60,680 | $ 14,752 |
Total cost of products revenues | 126,251 | 130,180 | 193,660 |
Gross profit | 150,617 | 179,836 | 103,041 |
Operating expenses | |||
Research and development | 9,451 | 9,772 | 10,340 |
Selling, general and administrative | 118,960 | 113,832 | 116,449 |
Restructuring | 4,578 | ||
Total operating expenses | 132,989 | 123,604 | 126,789 |
Income (loss) from operations | 17,628 | 56,232 | (23,748) |
Interest expense | (21,014) | (28,882) | (909) |
Interest income | 12 | 232 | 1,935 |
(Loss) income before income taxes | (3,374) | 27,582 | (22,722) |
(Benefit from) provision for income taxes | (74,891) | 830 | 0 |
Net income (loss) | $ 71,517 | $ 26,752 | $ (22,722) |
Earnings (loss) per share - basic (in dollars per share) | $ 2.05 | $ 0.78 | $ (0.68) |
Weighted-average shares - basic (in shares) | 34,936,817 | 34,407,959 | 33,453,844 |
Earnings (loss) per share - diluted (in dollars per share) | $ 1.86 | $ 0.76 | $ (0.68) |
Weighted-average shares - diluted (in shares) | 41,045,805 | 35,151,353 | 33,453,844 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Common stock | Additional Paid-In CapitalAdjustment. | Additional Paid-In Capital | Treasury Stock, at cost | Accumulated DeficitAdjustment. | Accumulated Deficit | Adjustment. | Total |
Balance at beginning of period at Dec. 31, 2018 | $ 33 | $ 428,729 | $ 0 | $ (337,177) | $ 91,585 | |||
Balance at beginning of year, shares at Dec. 31, 2018 | 33,265,629 | 0 | ||||||
Exercise of common stock options | 2,046 | 2,046 | ||||||
Exercise of common stock options, shares | 201,308 | |||||||
Issuance for employee stock purchase plan | $ 1 | 816 | 817 | |||||
Issuance for employee stock purchase plan, shares | 74,142 | |||||||
Vesting of RSUs and PSUs, shares | 196,139 | |||||||
Shares withheld for employee taxes upon vesting of RSUs and PSUs | (822) | (822) | ||||||
Shares withheld for employee taxes upon vesting of RSUs and PSUs, shares | (58,378) | |||||||
Stock-based compensation | 16,528 | 16,528 | ||||||
Net income (loss) | (22,722) | (22,722) | ||||||
Balance at end of period at Dec. 31, 2019 | $ 34 | 447,297 | $ 0 | (359,899) | 87,432 | |||
Balance at end of year, shares at Dec. 31, 2019 | 33,678,840 | 0 | ||||||
Exercise of common stock options | $ 1 | 6,656 | 6,657 | |||||
Exercise of common stock options, shares | 637,924 | |||||||
Issuance for employee stock purchase plan | 758 | 758 | ||||||
Issuance for employee stock purchase plan, shares | 67,512 | |||||||
Vesting of RSUs and PSUs, shares | 335,524 | |||||||
Shares withheld for employee taxes upon vesting of RSUs and PSUs | (2,255) | (2,255) | ||||||
Shares withheld for employee taxes upon vesting of RSUs and PSUs, shares | (107,746) | |||||||
Stock-based compensation | 21,910 | 21,910 | ||||||
Equity component of 2020 Convertible Notes, net of issuance costs of $1,773 | 44,777 | 44,777 | ||||||
Net income (loss) | 26,752 | 26,752 | ||||||
Balance at end of period at Dec. 31, 2020 | $ 35 | $ (44,777) | 519,143 | $ 0 | $ 5,288 | (333,147) | $ (39,489) | $ 186,031 |
Balance at end of year, shares at Dec. 31, 2020 | 34,612,054 | 0 | 34,612,054 | |||||
Exercise of common stock options | $ 1 | 11,868 | $ 11,869 | |||||
Exercise of common stock options, shares | 803,485 | |||||||
Issuance for employee stock purchase plan | 755 | 755 | ||||||
Issuance for employee stock purchase plan, shares | 43,719 | |||||||
Vesting of RSUs and PSUs, shares | 511,743 | |||||||
Shares withheld for employee taxes upon vesting of RSUs and PSUs | (4,149) | (4,149) | ||||||
Shares withheld for employee taxes upon vesting of RSUs and PSUs, shares | (164,882) | |||||||
Share repurchases | $ (42,861) | (42,861) | ||||||
Share repurchases (in shares) | (2,150,717) | |||||||
Forward contract on ASR agreement | (5,000) | (5,000) | ||||||
Stock-based compensation | 24,255 | 24,255 | ||||||
Net income (loss) | 71,517 | 71,517 | ||||||
Balance at end of period at Dec. 31, 2021 | $ 36 | $ 502,095 | $ (42,861) | $ (256,342) | $ 202,928 | |||
Balance at end of year, shares at Dec. 31, 2021 | 35,806,119 | (2,150,717) | 33,655,402 |
CONSOLIDATED STATEMENTS OF SH_2
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Parenthetical) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY | |
Equity component of 2020 Convertible Notes, issuance costs | $ 1,773 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Operating activities | |||
Net income (loss) | $ 71,517 | $ 26,752 | $ (22,722) |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | |||
Amortization expense | 67,181 | 60,680 | 14,752 |
Depreciation expense | 1,736 | 870 | 731 |
Deferred income taxes | (78,042) | ||
Stock-based compensation expense | 24,255 | 21,910 | 16,528 |
Non-cash lease expense | 18 | 57 | 313 |
Non-cash interest expense for amortization of debt discount and issuance costs | 3,406 | 8,972 | |
Changes in operating assets and liabilities: | |||
Accounts receivable | (22,524) | (10,367) | 4,993 |
Inventory | (2,296) | (8,270) | (1,826) |
Prepaid expenses and other assets | (1,086) | (1,598) | 2,037 |
Accounts payable | (5,827) | 3,769 | (5,903) |
Accrued expenses | 4,777 | (7,838) | 6,056 |
Accrued rebates, returns and discounts | 40,442 | (995) | 12,766 |
Operating lease assets and liabilities | 734 | ||
Other long-term liabilities | (676) | ||
Net cash provided by operating activities | 103,557 | 93,942 | 27,783 |
Investing activities | |||
Purchase of intangible asset | (368,226) | ||
Purchases of property and equipment | (1,944) | (5,546) | (6,438) |
Net cash used in investing activities | (1,944) | (373,772) | (6,438) |
Financing activities | |||
Proceeds from issuances of common stock from employee stock purchase plans | 755 | 758 | 817 |
Proceeds from the exercise of stock options | 11,952 | 6,577 | 2,046 |
Payments made for employee stock tax withholdings | (4,149) | (2,255) | (822) |
Repurchases of common stock, including the ASR agreement | (47,861) | ||
Proceeds from issuance of term note, net of issuance costs of $2,456 | 192,117 | ||
Proceeds from convertible senior notes, net of issuance costs of $5,473 | 138,277 | ||
Repayment of term notes | (50,000) | (37,500) | |
Repayment of term loan | (11,500) | ||
Net cash (used in) provided by financing activities | (89,303) | 286,474 | 2,041 |
Net increase in cash, cash equivalents and restricted cash | 12,310 | 6,644 | 23,386 |
Cash, cash equivalents and restricted cash at beginning of period | 176,663 | 170,019 | 146,633 |
Cash, cash equivalents and restricted cash at end of period | 188,973 | 176,663 | 170,019 |
Reconciliation of cash, cash equivalents and restricted cash to the Consolidated Balance Sheets: | |||
Cash and cash equivalents | 186,426 | 174,116 | 170,019 |
Restricted cash | 2,547 | 2,547 | |
Total cash, cash equivalents and restricted cash | 188,973 | 176,663 | 170,019 |
Supplemental disclosure of cash flow information | |||
Cash paid for offering costs | 30 | ||
Cash paid for interest | 17,608 | 18,967 | 709 |
Cash paid for income taxes | 3,005 | 483 | |
Supplemental disclosure of non-cash activities | |||
Acquisition of property and equipment in accounts payable and accrued expenses | 72 | 293 | 134 |
Accrued royalties discharged upon closing of asset acquisition | 1,145 | ||
Inventory used in the construction and installation of property and equipment | $ 516 | 2,299 | |
Receivable from stock option exercises in other current assets | $ 80 | ||
Operating lease assets assumed | 9,957 | ||
Operating lease liabilities assumed | $ 10,691 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Secured debt | |
Debt Instrument [Line Items] | |
Issuance costs | $ 2,456 |
Convertible Debt | |
Debt Instrument [Line Items] | |
Issuance costs | $ 5,473 |
NATURE OF BUSINESS
NATURE OF BUSINESS | 12 Months Ended |
Dec. 31, 2021 | |
NATURE OF BUSINESS | |
NATURE OF BUSINESS | 1. NATURE OF BUSINESS Organization Collegium Pharmaceutical, Inc. (the “Company”) was incorporated in Delaware in April 2002 and then reincorporated in Virginia in July 2014. The Company has its principal operations in Stoughton, Massachusetts. The Company’s mission is to build a leading, diversified specialty pharmaceutical company committed to improving the lives of people living with serious medical conditions. The Company’s first product, Xtampza ER, is an abuse-deterrent, extended-release, oral formulation of oxycodone. In April 2016, the Food and Drug Administration (the “FDA”) approved the Company’s new drug application (“NDA”) for Xtampza ER for the management of pain severe enough to require daily, around-the-clock, long-term opioid treatment and for which alternative treatment options are inadequate. In June 2016, the Company announced the commercial launch of Xtampza ER. The Company’s product portfolio also includes Nucynta ER and Nucynta IR (the “Nucynta Products”). In December 2017, the Company entered into a Commercialization Agreement (the “Nucynta Commercialization Agreement”) with Assertio Therapeutics, Inc. (formerly known as Depomed) (“Assertio”), pursuant to which the Company acquired the right to commercialize the Nucynta Products in the United States. The Company began shipping and recognizing product sales on the Nucynta Products on January 9, 2018 and began marketing the Nucynta Products in February 2018. Nucynta ER is an extended-release formulation of tapentadol that is indicated for the management of pain severe enough to require daily, around-the-clock, long-term opioid treatment, including neuropathic pain associated with diabetic peripheral neuropathy in adults, and for which alternate treatment options are inadequate. Nucynta IR is an immediate-release formulation of tapentadol that is indicated for the management of acute pain severe enough to require an opioid analgesic and for which alternative treatments are inadequate in adults. On February 6, 2020, the Company entered into an Asset Purchase Agreement with Assertio (the “Nucynta Purchase Agreement”), pursuant to which the Company agreed to acquire from Assertio certain assets related to the Nucynta Products (the “Nucynta Acquisition”), including the license from Grünenthal GmbH (“Grünenthal”), for an aggregate purchase price of $375,000, subject to certain closing and post-closing adjustments as described in the Nucynta Purchase Agreement. On February 13, 2020, the Company closed the Nucynta Acquisition in accordance with the Nucynta Purchase Agreement. Upon closing, the Nucynta Commercialization Agreement was effectively terminated. Following the closing, the Company's prior royalty obligation to Assertio ceased and the Company’s only remaining royalty obligation is to pay 14% of net sales of the Nucynta Products directly to Grünenthal. The Company periodically reviews its accounting estimates in light of changes in circumstances, facts and experience. As of the date of the filing of this Annual Report on Form 10-K, the Company expects the COVID-19 pandemic and actions taken to contain it to continue to impact its revenue. Notwithstanding the lifting of COVID-19 restrictions in many jurisdictions, and amidst continuing public health concerns relating to the spread of COVID-19, weekly pain patient office visits continue to be depressed compared to pre-COVID periods, which in turn may account for fewer patients beginning therapy with the Company’s products. The Company believes that the disruptions caused by COVID-19 will continue and there remains substantial uncertainty as to when such disruptions will cease. The Company’s operations are subject to certain risks and uncertainties. The principal risks include inability to continue successfully commercializing products, changing market conditions for products and development of competing products, changing regulatory environment and reimbursement landscape, litigation related to opioid marketing and distribution practices, manufacture of adequate commercial inventory, inability to secure adequate supplies of active pharmaceutical ingredients, key personnel retention, protection of intellectual property, and patent infringement litigation. Liquidity The Company believes that its cash and cash equivalents at December 31, 2021, together with expected cash inflows from the commercialization of its products, will enable the Company to fund its operating expenses, debt service and capital expenditure requirements under its current business plan for the foreseeable future. The Company historically experienced net losses in each year since its inception until 2020, and as of December 31, 2021, had an accumulated deficit of $256,342. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2021 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Accounting The consolidated financial statements include the accounts of Collegium Pharmaceutical, Inc. as well as the accounts of its subsidiaries Collegium Securities Corp. (a Massachusetts corporation), incorporated in December 2015, and Collegium NF LLC (a Delaware limited liability company), incorporated in December 2017, both wholly owned subsidiaries requiring consolidation. The consolidated financial statements are prepared in conformity with generally accepted accounting principles in the United States of America (“GAAP”). All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of consolidated financial statements in accordance with GAAP requires the Company to make estimates and assumptions that impact the reported amounts of assets, liabilities, revenues, costs and expenses and the disclosure of contingent assets and liabilities in the Company’s consolidated financial statements and accompanying notes. Estimates in the Company’s consolidated financial statements include revenue recognition, including the estimates of product returns, discounts and allowances related to commercial sales of products, estimates of useful lives with respect to intangible assets, accounting for stock-based compensation, contingencies, impairment of intangible assets and tax valuation allowances. The Company bases estimates and assumptions on historical experience when available and on various factors that it believes to be reasonable under the circumstances. The Company evaluates its estimates and assumptions on an ongoing basis. The Company’s actual results may differ from these estimates under different assumptions or conditions. Fair Value Measurements Fair value measurements and disclosures describe the fair value hierarchy based on three levels of inputs as follows: Level 1 inputs: Quoted prices (unadjusted) in active markets for identical assets or liabilities Level 2 inputs: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly Level 3 inputs: Unobservable inputs that reflect the Company’s own assumptions about the assumptions market participants would use in pricing the asset or liability There were no transfers between Levels 1, 2 and 3 during the years ended December 31, 2021 and 2020. The following tables present the Company’s financial instruments carried at fair value using the lowest level input applicable to each financial instrument at December 31, 2021 and 2020. Significant Quoted Prices other Significant in active observable unobservable markets inputs inputs Total (Level 1) (Level 2) (Level 3) December 31, 2021 Money market funds, included in cash equivalents $ 45,078 $ 45,078 $ — $ — December 31, 2020 Money market funds, included in cash equivalents $ 45,069 $ 45,069 $ — $ — The Company’s cash equivalents, which consist of money market funds, are measured at fair value on a recurring basis using quoted market prices. Accordingly, these securities are categorized as Level 1. The Company’s convertible senior notes fall into the Level 2 category within the fair value level hierarchy. The fair value was determined based on data points other than quoted prices that are observable, either directly or indirectly, such as broker quotes in a non-active market. As of December 31, 2021, the convertible senior notes had a fair value of approximately $139,078 and a net carrying value of $139,966. The Company’s term notes fall into the Level 2 category within the fair value level hierarchy and the fair value was determined using quoted prices for similar liabilities in active markets, as well as inputs that are observable for the liability (other than quoted prices), such as interest rates that are observable at commonly quoted intervals. As of December 31, 2021, the carrying amount of the term notes reasonably approximated the estimated fair value. As of December 31, 2021, and December 31, 2020, the carrying amounts of the cash and cash equivalents, accounts receivable, prepaid expenses and other current assets, accounts payable, accrued expenses, and accrued rebates, returns and discounts, reasonably approximated the estimated fair values. Concentration of Credit Risk Financial instruments, which potentially subject the Company to significant concentration of credit risk, consist primarily of cash and cash equivalents and accounts receivable. The Company maintains its cash deposits primarily with one reputable and nationally recognized financial institution. In addition, as of December 31, 2021, the Company’s cash equivalents were invested in money market funds. The Company has not experienced any material losses in such accounts and management believes that the Company is not exposed to significant credit risk due to the financial position of the financial institutions in which those deposits are held. Three customers comprised 10% or more of the Company’s accounts receivable balance as of December 31, 2021. These customers comprised 46%, 33% and 20% of the accounts receivable balance as of December 31, 2021; 46%, 34% and 17% as of December 31, 2020; and 51%, 27%, and 19% as of December 31, 2019. The same three customers comprised 10% or more of the Company’s revenue during the year ended December 31, 2021. These customers comprised 35%, 31% and 29% of revenue during the year ended December 31, 2021; 34%, 31% and 31% during the year ended December 31, 2020; and 34%, 31%, and 30% during the year ended December 31, 2019. To date, the Company has not experienced any credit losses with respect to the collection of its accounts receivable and has not recorded an allowance for credit losses as of December 31, 2021 or 2020. The Company has no financial instruments with off balance sheet risk of loss. Cash and Cash Equivalents Cash and cash equivalents include cash in readily available checking and savings accounts and money market funds. The Company considers all highly liquid investments with an original maturity of three months or less from the date of purchase to be cash equivalents. Restricted Cash Restricted cash is reported as non-current unless the restrictions are expected to be released in the next twelve months. As of December 31, 2021 and 2020, the Company had restricted cash of $2,547, which represents cash held in a depository account at a financial institution to collateralize conditional stand by letters of credit for the Company’s corporate credit card program, its lease of its corporate headquarters, and its leases of vehicles for its field-based employees. Inventory Inventories are stated at the lower of cost or net realizable value. Inventory costs consist of costs related to the manufacturing of the Company’s products, which are primarily the costs of contract manufacturing and active pharmaceutical ingredient. The Company determines the cost of its inventories on a specific identification basis, and removes amounts from inventories on a first-in, first-out basis. If the Company identifies excess, obsolete or unsalable items, inventories are written down to their realizable value in the period in which the impairment is identified. These adjustments are recorded based upon various factors, including the level of product manufactured by the Company, the level of product in the distribution channel, current and projected demand and the expected shelf-life of the inventory components. As of December 31, 2021, cumulative estimates of excess inventory recorded as a component of cost of product revenues were immaterial. The Company outsources the manufacturing of Xtampza ER and the Nucynta Products to contract manufacturers that produce the finished product. In addition, the Company currently relies on a sole supplier for the active pharmaceutical ingredient in Xtampza ER and the Nucynta Products. Accordingly, the Company has concentration risk associated with its commercial manufacturing of Xtampza ER and the Nucynta Products. The Company has capitalized $17,394 of inventory as of December 31, 2021. The Company expects to use the inventory over its operating cycle. Property and Equipment Property and equipment, including leasehold improvements, are recorded at cost. Maintenance and repair costs are expensed as incurred. Costs which materially improve or extend the lives of existing assets are capitalized. Property and equipment are depreciated when placed into service using the straight-line method based on their estimated useful lives as follows: Asset Category Estimated Useful Life Computers and office equipment 3-5 years Laboratory equipment 5 years Furniture and fixtures 7 years Manufacturing equipment 5-13 years Leasehold improvements Lesser of remaining lease term and estimated useful life Costs for capital assets not yet placed into service have been capitalized as construction-in-progress, and will be depreciated in accordance with the above guidelines once placed into service. Upon retirement or sale, the cost of assets disposed and the related accumulated depreciation are removed from the accounts and any resulting gain or loss is recorded in the statements of operations. Intangible Assets The Company records the fair value of finite-lived intangible assets as of the transaction date. Intangible assets are then amortized over their estimated useful lives using either the straight-line method, or if reliably determinable, based on the pattern in which the economic benefit of the asset is expected to be utilized. The Company tests intangible assets for potential impairment whenever triggering events or circumstances present an indication of impairment. If the sum of expected undiscounted future cash flows of the intangible assets is less than the carrying amount of such assets, the intangible assets would be written down to the estimated fair value, calculated based on the present value of expected future cash flows. Leases In accordance with ASC Topic 842, Lease Accounting, Variable lease costs are not included in the measurement of the operating lease liability and are recognized in the period in which they are incurred. Revenue Recognition The Company’s revenue to date is from sales of the Company’s products, which are primarily sold to distributors, which in turn sell the product to pharmacies for the treatment of patients. In accordance with ASC Topic 606, Revenue from Contracts with Customers Refer to Note 3 Revenue from Contracts with Customers Research and Development Costs Research and development costs are charged to expense as incurred and consist of costs incurred to further the Company’s research and development activities. These costs include compensation and employee related costs, including stock based compensation; costs associated with conducting our clinical and non-clinical activities, including clinical and non-clinical trials that the Company conducts for post-marketing requirements; and costs for laboratory supplies, depreciation of lab equipment, and other expenses including allocated expenses for rent and maintenance of facilities. Patent Costs Costs related to filing and pursuing patent applications are recorded as selling, general and administrative expense as incurred since the recoverability of such expenditures is uncertain. Advertising and Product Promotion Costs Advertising and product promotion costs are included in selling, general and administrative expenses and were $4,186, $5,368 and $9,527 in the years ended December 31, 2021, 2020, and 2019 respectively. Advertising and product promotion costs are expensed as incurred. Stock-Based Compensation The Company accounts for grants of stock options, restricted stock units and performance share units to employees, as well as to the Board of Directors, based on the grant date fair value and recognizes compensation expense over the vesting period, net of actual forfeitures. For employee awards with service conditions, the Company recognizes compensation expense on a straight-line basis. The Company estimates the grant date fair value of stock options using the Black-Scholes option pricing model. The Company estimates the grant date fair value of restricted stock units based on the fair value of the underlying common stock. For awards with performance conditions, the Company estimates the number of shares that will vest based upon the probability of achieving performance metrics. For employee awards with market conditions, the Company recognizes compensation expense on an accelerated attribution basis. The Company estimates the grant date fair value of awards with market conditions using the Monte Carlo model. Restructuring During the three months ended December 31, 2021, the Company executed a plan to reduce its workforce, primarily related to its salesforce. The arrangements included the payment of a cash severance benefit near the time of separation, together with continued medical benefits and related services. As a result, the Company recognized $4,578 in restructuring expense. Of this amount, $1,335 was paid by December 31, 2021 and $2,980 was paid in January 2022, with the remaining $263 will be paid in the first half of 2022. Income Taxes The Company accounts for income taxes under the liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements. Under this method, deferred tax assets and liabilities are determined on the basis of the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the years in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The Company recognizes net deferred tax assets to the extent that the Company believes these assets are more likely than not to be realized. In making such a determination, management considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies and the absence of carryback available from results of recent operations. The Company records uncertain tax positions on the basis of a two-step process whereby (i) management determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (ii) for those tax positions that meet the more likely than not recognition threshold, management recognizes the largest amount of tax benefit that is more than 50% likely to be realized upon ultimate settlement with the related tax authority. The Company will recognize interest and penalties related to uncertain tax positions within income tax expense. Any accrued interest and penalties will be included within the related tax liability. As of December 31, 2021, the Company had no accrued interest or penalties related to uncertain tax positions and no amounts have been recognized in the Company’s statements of operations. Earnings per Share Basic earnings per share is calculated by dividing the net income (loss) attributable to common shareholders by the weighted-average number of shares of common stock outstanding during the period, without consideration for potentially dilutive securities. Diluted earnings per share is computed by dividing the net income (loss) attributable to common shareholders by the weighted-average number of shares of common stock, plus potentially dilutive securities outstanding for the period, as determined in accordance with the treasury stock, if-converted, or contingently issuable accounting methods, depending on the nature of the security. For purposes of the diluted earnings per share calculation, stock options, restricted stock units, performance share units, and shares potentially issuable in connection with our employee stock purchase plan and Convertible Notes are considered potentially dilutive securities and included to the extent that their addition is not anti-dilutive. Embedded Derivatives The Company accounts for derivative financial instruments as either equity or liabilities in accordance with Accounting Standards Codification Topic 815, Derivatives and Hedging refer to Note Debt Recently Adopted Accounting Pronouncements New accounting pronouncements are issued periodically by the Financial Accounting Standards Board (“FASB”) and are adopted by the Company as required by the specified effective dates. In December 2019, the FASB issued Accounting Standards Update (“ASU”) 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848) Facilitation of the Effects of Reference Rate Reform on Financial Reporting Reference Rate Reform (Topic 848): Scope, In August 2020, the FASB issued ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity's Own Equity The Company elected to early adopt this guidance on January 1, 2021 using the modified retrospective method. Under this transition method, the cumulative effect of the accounting change was removing the impact of recognizing the equity component of the Company’s convertible notes (at issuance and the subsequent accounting impact of additional interest expense from debt discount amortization). The cumulative effect of the accounting change as of January 1, 2021 was an increase to the carrying amount of the convertible notes of $39,489, a reduction to accumulated deficit of $5,288, and a reduction to additional paid-in capital of $44,777. Interest expense of the convertible senior notes will be lower as a result of adoption of this guidance and diluted net loss per share will be computed using the if-converted method for the convertible senior notes. As a result of the adoption of this guidance, interest expense decreased and net income In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options. Recently Issued Accounting Pronouncements Not Yet Adopted Other recent accounting pronouncements issued, but not yet effective, are not expected to be applicable to the Company or have a material effect on the consolidated financial statements upon future adoption. |
REVENUE FROM CONTRACTS WITH CUS
REVENUE FROM CONTRACTS WITH CUSTOMERS | 12 Months Ended |
Dec. 31, 2021 | |
REVENUE FROM CONTRACTS WITH CUSTOMERS | |
REVENUE FROM CONTRACTS WITH CUSTOMERS | 3. REVENUE FROM CONTRACTS WITH CUSTOMERS The Company’s revenue to date is from sales of the Company’s products, which are primarily sold to wholesalers (“customers”), which in turn sell the product to pharmacies for the treatment of patients (“end users”). Revenue Recognition In accordance with ASC Topic 606, the Company recognizes revenue when a 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 Topic 606, the Company 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 only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC Topic 606, the Company assesses the goods or services promised within each contract and determines those that are performance obligations and assesses whether each promised good or service is distinct. The Company then 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. The Company expenses incremental costs of obtaining a contract as and when incurred if the expected amortization period of the assets is one year or less. Performance Obligations The Company determined that performance obligations are satisfied, and revenue is recognized when a customer takes control of the Company’s product, which occurs at a point in time. This generally occurs upon delivery of the products to customers (wholesalers), at which point the Company recognizes revenue and records accounts receivable. Payment is typically received 30 to 90 days after satisfaction of the Company’s performance obligations. Transaction Price and Variable Consideration Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring products or services to a customer (“transaction price”). The transaction price for product sales includes variable consideration related to sales deductions, including (1) rebates and incentives, including managed care rebates, government rebates, co-pay program incentives, and sales incentives and allowances; (2) product returns, including return estimates; and, (3) trade allowances and chargebacks, including fees for distribution service fees, prompt pay discounts, and chargebacks. The Company will estimate the amount of variable consideration that should be included in the transaction price under the expected value method for all sales deductions other than trade allowances, which are estimated under the most likely amount method. These provisions reflect the expected amount of consideration to which the Company is entitled based on the terms of the contract. In addition, the Company made a policy election to exclude from the measurement of the transaction price all taxes that are assessed by a governmental authority that are imposed on revenue-producing transactions. The Company bases its estimates of variable consideration, which could include estimates of future rebates, returns, and other adjustments, on historical data and other information. Estimates include: (i) timing of the rebates and returns incurred, (ii) pricing adjustments related to rebates and returns, and (iii) the quantity of product that will be rebated or returned in the future. Significant judgment is used in determining the appropriateness of these assumptions at each reporting period. Provisions for rebates and incentives are based on the estimated amount of rebates and incentives to be claimed on the related sales. As the Company’s rebates and incentives are based on products dispensed to patients, the Company is required to estimate the expected value of claims at the time of product delivery to wholesalers. Given that wholesalers sell the product to pharmacies, which in turn dispense the product to patients, claims can be submitted significantly after the related sales are recognized. The Company’s estimates of these claims are based on the historical experience of existing or similar programs, including current contractual and statutory requirements, specific known market events and trends, industry data, and estimated distribution channel inventory levels. Accruals and related reserves required for rebates and incentives are adjusted as new information becomes available, including actual claims. If actual results vary, the Company may need to adjust future estimates, which could have an effect on earnings in the period of the adjustment. Provisions for trade allowances and chargebacks are primarily based on customer-level contractual terms. Accruals and related reserves are adjusted as new information becomes available, which generally consists of actual trade allowances and chargebacks processed relating to sales recognized. Provisions for product returns are based on product-level returns rates, recent unprocessed return claims, as well as relevant market events and other factors. Estimates of the future product returns are made at the time of revenue recognition to determine the amount of consideration to which the Company expects to be entitled (that is, excluding the products expected to be returned). To the extent the Company receives amounts in excess of what it expects to be entitled to receive due to a product return, the Company does not recognize revenue when it transfers products to customers but instead recognizes those excess amounts received as a refund liability. The Company updates the measurement of the refund liability at the end of each reporting period for changes in expectations about the amount of refunds with the corresponding adjustments recognized as revenue (or reductions of revenue). Historically, estimates of the refund liability for product returned for Nucynta Products were based on historical returns rates as these products have been commercially sold in the US since 2009 for Nucynta IR and since 2011 for Nucynta ER. Because the Company began selling the Nucynta Products in 2018, the majority of Nucynta Products sold to customers by the Company were not eligible for return until the year ended December 31, 2021, or beyond. For Xtampza ER, estimates of the refund liability for product returns were historically based on a combination of historical actual returns processed to date, taking into consideration the expiration date of product upon delivery to customers, as well as forecasted customer buying and return patterns, channel inventory levels, and other specifically known market events and trends. Sales of Xtampza increased significantly starting in 2018; as a result, the majority of Xtampza sold to customers by the Company has not been eligible for return until the year ended December 31, 2021, or beyond. The Company’s customers short-pay an existing invoice upon notice of a product return claim. Adjustments to the preliminary short-paid claims are processed when the product is physically returned and the return claim is validated and finalized. The Company’s return policy requires that product is physically returned within an 18-month window beginning six months prior to expiration and up until twelve months after expiration. During the year ended December 31, 2021, there were unprecedented and significant disruptions in the processing of product returns. Specifically, the Company’s customers, via the third-party returns processor that they and many pharmacies engage to process the majority of the Company’s product returns, failed to return products to the Company in the ordinary course. The value of actual returned product during the year ended December 31, 2021 represented less than 20% of the value of the product returns claimed during that period. Due to the failure of the customers and their vendor to return product timely in the ordinary course, the Company did not physically receive returned products corresponding to the substantial majority of the returns claimed and could not validate or finalize customer return claims, nor determine if the return was or would be eligible for refund upon the physical return. The lack of timely processing of requested product returns obscures information related to the validation of product returns and increases uncertainty related to the actual volume of product that will be physically returned and credited in accordance with the Company’s returns policy. During the fourth quarter of 2021, after significant and sustained efforts with customers to resolve the unprocessed return claims, the Company formally denied a significant portion of these claims under the Company’s return policy. The Company subsequently received payment for only a portion of the denied claims and intends to vigorously pursue collections of the full amount of these short-pay receivables. Additional unprocessed return claims have and are expected to continue to expire prior to their physical return. Although the Company has denied and expects to continue to deny credit for product returns that are not in accordance with its return policy, uncertainty exists related to the ultimate resolution of these claims. At the end of each reporting period, the Company updates the estimated transaction price (including updating its assessment of whether an estimate of variable consideration is constrained) to represent faithfully the circumstances present at the end of the reporting period and the changes in circumstances during the reporting period. Variable consideration, including the risk of customer concessions, is included in the transaction price only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty is subsequently resolved. In particular, resolution of the unprocessed return claims includes the risk of concession for those that are outside of the Company’s return policy. As a result of discussions with customers related to unprocessed return claims and the uncertainty associated with the ultimate resolution, as well as the impact of unprocessed claims on estimates of future returns, the Company recorded an adjustment to reduce product revenue, net of $38,329 , with offsetting reductions in accounts receivable or increases in the refund liability for future product returns. Significant judgment is required to determine the variable consideration included in the transaction price as described above. Adjustments to the estimated variable consideration included in the transaction price occurs when new information indicates that the estimate should be revised. If the value of accepted and processed claims is different than the amount estimated and included in variable consideration, then adjustments would impact product revenue, net and earnings in the period such revisions become known. During the year ended December 31, 2021, the Company’s adjustment related the transaction price of performance obligations satisfied in the prior year was $26,644, which includes $8,763 in adjustments to the refund liability. The amount of variable consideration ultimately received and included in the transaction price may materially differ from the Company’s estimates, resulting in additional adjustments recorded to increase or decrease product revenue, net. The following table summarizes activity in each of the Company’s product revenue provision and allowance categories for the years ended December 31, 2021, 2020, and 2019, respectively: Trade Rebates and Product Allowances and Incentives (1) Returns (2) Chargebacks (3) Balance at December 31, 2018 $ 129,318 $ 15,465 $ 14,841 Provision related to current period sales 263,315 14,991 65,155 Changes in estimate related to prior period sales (2,865) — — Credits/payments made (259,867) (2,808) (65,976) Balance at December 31, 2019 $ 129,901 $ 27,648 $ 14,020 Provision related to current period sales 326,280 10,900 75,554 Changes in estimate related to prior period sales (539) — (403) Credits/payments made (322,867) (14,769) (70,116) Balance at December 31, 2020 $ 132,775 $ 23,779 $ 19,055 Provision related to current period sales 378,694 27,229 84,470 Changes in estimate related to prior period sales 1,121 8,763 4 Credits/payments made (370,211) (5,154) (90,303) Balance at December 31, 2021 $ 142,379 $ 54,617 $ 13,226 (1) Provisions for rebates and incentives includes managed care rebates, government rebates and co-pay program incentives. Provisions for rebates and incentives are deducted from gross revenues at the time revenues are recognized and are included in accrued rebates, returns and discounts in the Company’s Consolidated Balance Sheets. (2) Provisions for product returns are deducted from gross revenues at the time revenues are recognized and are included in accrued rebates, returns and discounts in the Company’s Consolidated Balance Sheets. (3) Provisions for trade allowances and chargebacks include fees for distribution service fees, prompt pay discounts, and chargebacks. Trade allowances and chargebacks are deducted from gross revenue at the time revenues are recognized and are recorded as a reduction to accounts receivable in the Company’s Consolidated Balance Sheets. As of December 31, 2021, the Company did not have any transaction price allocated to remaining performance obligations and any costs to obtain contracts with customers, including pre-contract costs and set up costs, were immaterial. Disaggregation of Revenue The Company disaggregates its product revenue, net from contracts with customers into the categories included in the table below. These categories depict how the nature, timing and uncertainty of revenue and cash flows are affected by economic factors : Years ended December 31, 2021 2020 2019 Xtampza ER $ 103,708 127,984 $ 105,012 Nucynta Products (1) 173,160 182,032 191,689 Total product revenues, net $ 276,868 $ 310,016 $ 296,701 (1) For the year ended December 31, 2021, the Company recognized Nucynta IR and Nucynta ER product revenues, net of $102,222 and $70,938 respectively. For the year ended December 31, 2020, the Company recognized Nucynta IR and Nucynta ER product revenues, net of $116,318 and $65,714, respectively. For the year ended December 31, 2019, the Company recognized Nucynta IR and Nucynta ER product revenues, net of $117,680 and $74,009, respectively. |
LICENSE AGREEMENTS
LICENSE AGREEMENTS | 12 Months Ended |
Dec. 31, 2021 | |
LICENSE AGREEMENTS | |
LICENSE AGREEMENTS | 4. LICENSE AGREEMENTS The Company periodically enters into license agreements to develop and commercialize its products. As of December 31, 2019, the Company’s only license agreement was the Nucynta Commercialization Agreement. Upon the closing of the Nucynta Acquisition in February 2020, the Nucynta Commercialization Agreement was effectively terminated. The assets acquired, liabilities assumed, and equity interests issued by the Company in connection with the Nucynta Commercialization Agreement are further described in Note 9. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2021 | |
EARNINGS PER SHARE | |
EARNINGS PER SHARE | 5. EARNINGS PER SHARE The following table presents the computations of basic and dilutive earnings (loss) per common share: Years ended December 31, 2021 2020 2019 Numerator: Net income (loss) $ 71,517 $ 26,752 $ (22,722) Adjustment for interest expense recognized on convertible senior notes: 4,675 — — Net income (loss) — diluted $ 76,192 $ 26,752 (22,722) Denominator: Weighted-average shares outstanding — basic 34,936,817 34,407,959 33,453,844 Effect of dilutive securities: Stock options 504,699 431,524 — Restricted stock units 461,471 271,542 — Performance share units 85,229 27,002 — Employee stock purchase plan 1,198 567 — Warrants 131,257 12,759 — Convertible senior notes 4,925,134 — — Weighted average shares outstanding — diluted 41,045,805 35,151,353 33,453,844 Earnings (loss) per share — basic $ 2.05 $ 0.78 $ (0.68) Earnings (loss) per share — diluted $ 1.86 $ 0.76 $ (0.68) The Company has the option to settle the conversion obligation for its convertible senior notes due in 2026 in cash, shares or a combination of the two. Since the Company intends to settle the principal amount of the convertible senior notes in cash, the Company used the treasury stock method for determining the potential dilution in the diluted earnings per share computation for the year ended December 31, 2020. Effective for the year ended December 31, 2021, the Company used the if-converted method for the convertible senior notes as a result of the adoption of ASU 2020-06, as described in Recently Adopted Accounting Pronouncements above. The following table presents dilutive securities excluded from the calculation of diluted earnings per share: Years ended December 31, 2021 2020 2019 Stock options 1,202,403 2,294,961 3,955,887 Restricted stock units 22,605 4,809 849,679 Performance share units 242,714 211,618 99,400 Employee stock purchase plan — — — Warrants — — 1,041,667 Convertible senior notes — 4,925,134 — For performance share units, these securities were excluded from the calculation of diluted earnings per share as the performance-based or market-based vesting conditions were not met as of the end of the reporting period. All other securities presented in the table above were excluded from the calculation of diluted earnings per share as their inclusion would have had an antidilutive effect. As discussed in Note 14, the forward contract in connection with the Company’s ASR Agreement was outstanding as of December 31, 2021. As the Company is entitled to receive additional shares of its common stock in connection with the outstanding forward contract, the receipt of additional shares of common stock would be antidilutive. Therefore, no adjustments were made in the computation of earnings per share for the period the forward was outstanding. |
INVENTORY
INVENTORY | 12 Months Ended |
Dec. 31, 2021 | |
INVENTORY | |
INVENTORY | 6. INVENTORY Inventory consisted of the following: As of December 31, 2021 2020 Raw materials $ 3,685 $ 3,514 Work in process 1,007 1,096 Finished goods 12,702 11,004 Total inventory $ 17,394 $ 15,614 During the years ended December 31, 2021, 2020 and 2019, the aggregate charges related to excess inventory were immaterial. These expenses were recorded as a component of cost of product revenues. During the years ended December 31, 2021 and 2020, inventory used in the construction and installation of property and equipment was $516 and $2,299, respectively. During the year ended December 31, 2019, inventory used in the construction and installation of property and equipment was immaterial. |
PREPAID EXPENSES AND OTHER CURR
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 12 Months Ended |
Dec. 31, 2021 | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 7. PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets consisted of the following: As of December 31, 2021 2020 Prepaid regulatory fees $ 3,602 $ 3,280 Prepaid insurance 864 656 Other current assets 27 60 Prepaid development costs — 392 Other prepaid expenses 1,386 450 Prepaid expenses and other current assets $ 5,879 $ 4,838 |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2021 | |
PROPERTY AND EQUIPMENT | |
PROPERTY AND EQUIPMENT | 8. PROPERTY AND EQUIPMENT Property and equipment consisted of the following: As of December 31, 2021 2020 Computers and office equipment $ 1,547 $ 1,429 Laboratory equipment 1,340 1,299 Furniture and fixtures 1,079 1,073 Manufacturing equipment 14,498 14,119 Leasehold improvements 541 541 Construction-in-process 5,182 3,583 Total property and equipment 24,187 22,044 Less: accumulated deprecation (4,696) (3,056) Property and equipment, net $ 19,491 $ 18,988 Depreciation expense related to property and equipment amounted to $1,736, $870 and $731 for the years ended December 31, 2021, 2020 and 2019, respectively. During the years ended December 31, 2021, 2020, and 2019 the Company disposed of fully depreciated assets of $96, $102 and $280, respectively. The Company did not have any gains or losses from the retirement, sale or disposal of property and equipment during the years ended December 31, 2021, 2020, or 2019. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2021 | |
INTANGIBLE ASSETS | |
INTANGIBLE ASSETS | 9. INTANGIBLE ASSETS As of December 31, 2021 and 2020, the Company’s only intangible asset (“Nucynta Intangible Asset”) is related to the Nucynta Acquisition and the Nucynta Commercialization Agreement. The gross carrying amount and accumulated amortization of the Nucynta Intangible Asset were as follows: As of December 31, 2021 2020 Gross carrying amount $ 521,170 $ 521,170 Accumulated amortization (252,447) (185,266) Intangible asset, net $ 268,723 $ 335,904 Nucynta Acquisitions In February 2020, the Company entered into the Nucynta Purchase Agreement with Assertio, pursuant to which the Company acquired certain intellectual property and manufacturing rights related to the Nucynta Products, including U.S. commercialization rights, U.S. manufacturing rights, and inventory, for an aggregate purchase price of $375,000, subject to certain closing and post-closing adjustments. The Company also agreed to assume certain regulatory and supply chain contracts, and obligations related to Nucynta Products ( refer to Note 4 License Agreements refer to Note 12 Debt refer to Note 12 Debt The consideration transferred in the asset acquisition was measured at cost, including transaction costs, assets transferred by the Company, and royalty obligations discharged by the seller. The table below represents the costs accumulated to acquire the commercial rights for the Nucynta Products based on the terms of the Nucynta Purchase Agreement, as amended: Acquisition consideration: Base purchase price $ 375,000 Cash paid for inventory 6,030 Transaction costs 6,297 Reduction for 2020 cash transferred to Assertio under the prior Nucynta Commercialization Agreement (1) (13,071) Reduction for accrued royalty obligation discharged upon closing (1) (1,145) Total acquisition consideration: $ 373,111 (1) Represents $14,216 total reduction to the base purchase price comprising of $13,071 of cash payments transferred to Assertio under the prior Nucynta Commercialization Agreement as well as a reduction for $1,145 of discharged pre-acquisition accrued royalties based on sales from January 1, 2020 through closing. The Company then allocated the consideration transferred to the individual assets acquired on a relative fair value basis as summarized in the table below: Assets acquired: Nucynta Intangible Asset $ 367,081 Inventory 6,030 Total consideration allocated to assets acquired: $ 373,111 The Company concluded that the consideration allocable to the Nucynta Intangible Asset for the additional intellectual property and manufacturing rights it acquired as part of the Nucynta Acquisition were incremental costs associated with the pre-existing intangible asset from the former Nucynta Commercialization Agreement, as such costs result in probable future economic benefits. Specifically, the additional intellectual property rights acquired in the Nucynta Acquisition enable the Company to eliminate royalty obligations otherwise payable to Assertio under the former Nucynta Commercialization Agreement. Under the original terms of the Nucynta Commercialization Agreement, the Company was obligated to make guaranteed annual minimum royalty payments. Effective February 13, 2020, upon the closing of the Nucynta Acquisition, the Nucynta Commercialization Agreement was effectively terminated and the Company’s royalty payment obligations to Assertio thereunder ceased. Following the closing, the Company no longer pay royalties to Assertio and the Company’s only remaining royalty obligation is to pay 14% of net sales of the Nucynta Products directly to Grünenthal. The following table summarizes the gross carrying amount, accumulated amortization, and net book value of the Nucynta Intangible Asset for the years ended December 31, 2021, 2020, and 2019: Gross Carrying Value Accumulated Amortization Net Book Value Balance as of December 31, 2018 $ 154,089 $ (109,834) $ 44,255 Amortization expense — (14,752) (14,752) Balance as of December 31, 2019 $ 154,089 $ (124,586) $ 29,503 Amortization expense through Nucynta Acquisition — (1,754) (1,754) Additional cost incurred from Nucynta Acquisition 367,081 — 367,081 Amortization expense from Nucynta Acquisition through period end — (58,926) (58,926) Balance as of December 31, 2020 $ 521,170 $ (185,266) $ 335,904 Amortization expense through period end — (67,181) (67,181) Balance as of December 31, 2021 $ 521,170 $ (252,447) $ 268,723 Amortization The Company has been amortizing the Nucynta Intangible Asset over its useful life, which is the period over which the asset is expected to contribute directly or indirectly to the future cash flows of the Company. The Company determined that the useful life for the Nucynta Intangible Asset was approximately 5.9 years from the closing date of the Nucynta Acquisition. The Company recognizes amortization expense as a component of cost of product revenues in the Consolidated Statement of Operations on a straight-line basis over its useful life as it approximates the period of economic benefits expected to be realized from future cash inflows from sales of the Nucynta Products. Prior to the Nucynta Acquisition, the Company had recognized $126,340 of amortization expense related to the Nucynta Intangible Asset. As the accumulated cost basis of the Nucynta Intangible Asset was increased with the Nucynta Acquisition, the Company will continue to prospectively amortize the resulting net intangible asset on a straight-line basis over the remaining useful life. The following table presents amortization expense recognized for the years ended December 31, 2021, 2020, and 2019: Years ended December 31, 2021 2020 2019 Nucynta amortization expense included in cost of product revenues $ 67,181 $ 60,680 $ 14,752 As of December 31, 2021, the remaining amortization period is approximately 4.0 years and is expected to be recognized in the following periods: Years ended December 31, Amortization Expense 2022 $ 67,181 2023 67,181 2024 67,181 2025 67,180 Remaining amortization expense: $ 268,723 |
ACCRUED EXPENSES
ACCRUED EXPENSES | 12 Months Ended |
Dec. 31, 2021 | |
ACCRUED EXPENSES | |
ACCRUED EXPENSES | 10. ACCRUED EXPENSES Accrued expenses consisted of the following: As of December 31, 2021 2020 Accrued royalties $ 9,930 $ 12,954 Accrued audit and legal 3,623 445 Accrued restructuring expenses 3,222 — Accrued bonuses 2,634 4,571 Accrued product taxes and fees 2,570 1,817 Accrued interest 1,415 1,415 Accrued incentive compensation 851 1,417 Accrued payroll and related benefits 807 892 Accrued sales and marketing 697 261 Accrued income taxes 622 — Accrued other operating costs 2,843 884 Total accrued expenses $ 29,214 $ 24,656 As of December 31, 2021, the accrued audit and legal balance presented in the table above includes $2,750 related to litigation costs incurred to execute a settlement framework to resolve 27 pending opioid-related lawsuits. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2021 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 11. COMMITMENTS AND CONTINGENCIES Legal Proceedings From time to time, the Company may face legal claims or actions in the normal course of business. Except as disclosed below, the Company is not currently a party to any litigation and, accordingly, does not have any other amounts recorded for any litigation related matters. Xtampza ER Litigation The Company filed the NDA for Xtampza ER as a 505(b)(2) application, which allows the Company to reference data from an approved drug listed in the FDA’s Orange Book, in this case OxyContin. The 505(b)(2) process requires that the Company certify to the FDA that the Company does not infringe any of the patents listed for OxyContin in the Orange Book, or that the patents are invalid. The process also requires that the Company notify Purdue Pharma, L.P (“Purdue”), as the holder of the NDA, and any other Orange Book-listed patent owners that it has made such a certification. On February 11, 2015, the Company made the required certification documenting why Xtampza ER does not infringe any of the 11 Orange Book listed patents for OxyContin, five of which have been invalidated in court proceedings, and provided the required notice to Purdue. Under the Drug Price Competition and Patent Term Restoration Act of 1984, Purdue had the option to sue the Company for infringement and receive a stay of up to 30 months before the FDA could issue a final approval for Xtampza ER, unless the stay was earlier terminated. In response to these actions, Purdue sued the Company for infringement in the District of Delaware on March 24, 2015 asserting infringement of three of Purdue’s Orange Book-listed patents (Patent Nos. 7,674,799, 7,674,800, and 7,683,072) and a non-Orange Book-listed patent (Patent No. 8,652,497), and accordingly, received a 30-month stay of FDA approval. The Delaware court transferred the case to the District of Massachusetts. After the Company filed a partial motion for judgment on the pleadings relating to the Orange Book-listed patents, the District Court of Massachusetts ordered judgment in the Company’s favor on those three patents, and dismissed the claims asserting infringement of those patents with prejudice. Upon dismissal of those claims, the 30-month stay of FDA approval was lifted. As a result, the Company was able to obtain final approval for Xtampza ER and launch the product commercially. Purdue subsequently filed two follow-on lawsuits asserting infringement of two patents that had been late-listed in the Orange Book and therefore could not trigger any stay of FDA approval: Purdue filed suit asserting infringement of Patent No. 9,073,933 in November 2015, and asserted infringement of Patent No. 9,522,919 in April 2017. In addition, Purdue filed suit on two patents that had not been listed in the Orange Book, filing suit in June 2016 asserting infringement of Patent No. 9,155,717 and in September 2017, asserting infringement of Patent No. 9,693,961. On March 13, 2018, the Company filed a Petition for Post-Grant Review (“PGR”) of the ʼ961 patent with the Patent Trial and Appeal Board (“PTAB”). The PGR argues that the ʼ961 patent is invalid for lack of a written description, for lack of enablement, for indefiniteness, and as being anticipated by prior art. The PTAB held oral argument on the proceedings on July 10, 2019 and was scheduled to issue a decision on the patentability of the ʼ961 patent by no later than October 4, 2019. On September 15, 2019, Purdue commenced a voluntary case under chapter 11 of title 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York. On September 24, 2019, Purdue gave the PTAB notice of its bankruptcy filing and sought the imposition of an automatic stay of the PGR proceedings. On October 2, 2019, the PTAB extended the one-year period for issuing its decision by up to six months. In October 2017, and in response to the filing of the Company’s Supplemental NDA (“sNDA”) seeking to update the drug abuse and dependence section of the Xtampza ER label, Purdue filed another suit asserting infringement of the ʼ933 and ʼ919 patent. The Company filed a motion to dismiss that action, and the Court granted its motion on January 16, 2018. A claim construction hearing was held on June 1, 2017. On November 21, 2017, the Court issued its claim construction ruling, construing certain claims of the ʼ933, ʼ497, and ʼ717 patents. The Court issued an order on September 28, 2018 in which it granted in part a motion for summary judgment that the Company filed. Specifically, the Court ruled that the Xtampza ER formulation does not infringe the ʼ497 and ʼ717 patents. On September 18, 2019, Purdue gave the Court notice of its bankruptcy filing and sought the imposition of an automatic stay of the proceedings. On September 20, 2019, the matter was stayed pending further order of the Court. On September 1, 2020, the Bankruptcy Court entered an Order Granting Motions for Relief from the Automatic Stay, lifting the automatic stays in both the District of Massachusetts and PTAB proceedings. The Company appealed the Bankruptcy Court’s Order, in part, and that appeal is stayed, on consent by Purdue, pending the outcome of any appeal of the PTAB proceedings. On September 11, 2020, Purdue filed a motion to terminate the PTAB action on the basis that those proceedings had gone beyond the 18-month statutory period. The Company opposed Purdue’s motion. On November 19, 2021, the PTAB (i) denied Purdue’s motion to terminate the PGR and (ii) issued its Final Written Decision, finding that claims 1-17 of the ʼ961 patent were invalid for lack of written description and anticipation. On December 17, 2021, Purdue filed a Request for Director Review. That request was denied on February 7, 2022. On February 16, 2022, Purdue filed a Federal Circuit notice of appeal. On April 2, 2021, the Court granted Purdue’s Motion to Lift the Stay in the District of Massachusetts that was entered following Purdue’s Notice of Bankruptcy. On April 9, 2021, Purdue filed another follow-on lawsuit asserting infringement of U.S. Patent No. 10,407,434, which was late-listed in the Orange Book and therefore could not trigger any stay of FDA approval. The Company responded to Purdue’s complaint asserting the ’434 patent with a motion to dismiss. On May 21, 2021, and in response to the Company’s motion to dismiss, Purdue filed an amended complaint asserting the ’434 patent. The Company renewed its motion to dismiss on June 4, 2021, arguing: (i) Purdue cannot, as a matter of law, state a claim for infringement under § 271(e)(2)(A); (ii) Purdue cannot, as a matter of law, state a claim for product-by-process infringement under §271(g); and (iii) Purdue has not alleged facts sufficient to support any indirect infringement theory under §271(b) or (c). The Court held a hearing on the Company’s motion to dismiss on October 13, 2021, and the motion is pending before the Court. Like the prior follow-on lawsuits, the ’434 patent litigation was consolidated into the lead case and a scheduling order was entered. On October 5, 2021, the Court held a claim construction hearing for the ʼ961 patent and the ʼ434 patent. On November 17, 2021, by stipulation of the parties, the Court set (i) the fact discovery deadline for June 3, 2022; and (ii) expert witness depositions to conclude by August 19, 2022. The court has not set a deadline for dispositive motions or trial. The remaining patents-in-suit in the lead consolidated action in the District of Massachusetts are the ʼ933, ʼ919, ʼ434, and ʼ961 patents. Purdue has made a demand for monetary relief, and requested a judgment of infringement, an adjustment of the effective date of FDA approval, and an injunction on the sale of the Company’s products accused of infringement. The Company has denied all claims and has requested a judgment that the remaining asserted patents are invalid and/or not infringed; the Company is also seeking a judgment that the case is exceptional and has requested an award of the Company’s attorneys’ fees for defending the case. The Company plans to defend this case vigorously. At this stage, the Company is unable to evaluate the likelihood of an unfavorable outcome or estimate the amount or range of potential loss, if any. Nucynta Litigation On February 7, 2018, Purdue filed a patent infringement suit against the Company in the District of Delaware. Specifically, Purdue argues that the Company’s sale of immediate-release and extended-release Nucynta infringes U.S. Patent Nos. 9,861,583, 9,867,784, and 9,872,836. Purdue has made a demand for monetary relief in its complaint but has not quantified its alleged damages. On December 6, 2018, the Company filed an Amended Answer asserting an affirmative defense for patent exhaustion. On December 10, 2018, the Court granted the parties’ stipulation for resolution of the Company’s affirmative defense of patent exhaustion and stayed the action, with the exception of briefing on and resolution of the Company’s Motion for Judgment on the Pleadings related to patent exhaustion and any discovery related to that Motion. Also, on December 10, 2018, the Company filed a Rule 12(c) Motion for Judgment on the Pleadings, arguing that the Purdue’s claims were barred by the doctrine of patent exhaustion. On June 18, 2019, the Court heard oral argument on the Company’s Rule 12(c) Motion for Judgment on the Pleadings. On June 19, 2019, the Court issued an order stating that “judgment in Collegium’s favor is warranted under the doctrine of patent exhaustion to the extent Collegium’s alleged infringing activities resulted from sales that fall within the scope of that covenant.” The Court explained, however, that based on the current record, it was not possible “to determine whether title of the Nucynta Products was transferred to Collegium” from sales authorized by Purdue’s covenant not to sue. The Court ordered discovery on this issue and the case remained “stayed with the exception of discovery and briefing on and resolution of the Company’s anticipated motion for summary judgment based on patent exhaustion.” On September 19, 2019, Purdue gave the Court notice of its bankruptcy filing and sought the imposition of an automatic stay of the proceedings. The Nucynta litigation is subject to the automatic bankruptcy stay. Pending resolution of the bankruptcy action, the Company plans to defend this case vigorously. At this stage, the Company is unable to evaluate the likelihood of an unfavorable outcome or estimate the amount or range of potential loss, if any. Opioid Litigation As a result of the opioid epidemic, numerous state and local governments, healthcare providers, and other entities have brought suit against manufacturers, wholesale distributors, and pharmacies alleging a variety of claims related to opioid marketing and distribution practices. In late 2017, the U.S. Judicial Panel on Multidistrict Litigation ordered the consolidation of what were then a few hundred cases pending around the country in federal court against opioid manufacturers and distributors into a Multi-District Litigation (MDL) in the Northern District of Ohio. Currently, the Opioid MDL consists of over 2,000 opioid-related cases brought primarily by states, cities, counties, and other local entities. Generally speaking, these suits do not seek damages for injuries to individuals but rather compensation for the cost of public services needed to address the consequences of addicted communities, ranging from emergency response capabilities to rehabilitation services. The Company has been named as a defendant in a small subset of the MDL cases. Of the Eight cases that name the Company as a defendant, originally filed in three states, remain pending in the MDL: ● Virginia. On January 11, 2019, the City of Portsmouth filed a lawsuit in Virginia Circuit Court against the Company and other pharmaceutical manufacturers and distributors. The lawsuit alleges a variety of claims related to opioid marketing and distribution practices including public nuisance, common law fraud, negligent misrepresentation, negligence, and violations of state consumer protection laws. On October 3, 2019, the City of Portsmouth case was transferred to the MDL. ● New Jersey. On March 15, 2019, the Company was named in a lawsuit in the MDL by the City of Paterson, New Jersey. The lawsuit alleges violations of fraud, public nuisance, negligent misrepresentation, and violations of state consumer protection laws, and seeks, generally, penalties and/or injunctive relief. On June 14, 2019, the City of Trenton filed a lawsuit in the New Jersey Superior Court against the Company and other pharmaceutical manufacturers and distributors. The lawsuit alleges a variety of claims related to opioid marketing and distribution practices including public nuisance, common law fraud, negligent misrepresentation, negligence, and violations of state consumer protection laws and the New Jersey Drug Dealer Liability Act. On December 18, 2019, the case was transferred to the MDL. ● Connecticut. On April 9, 2019, the City of Norwich, Connecticut and the Town of Enfield, Connecticut filed lawsuits that name the Company in Connecticut Superior Court. The lawsuits allege violations of fraud, public nuisance, negligent misrepresentation, and violations of state consumer protection laws. On June 28, 2019, both cases were transferred to the MDL. In October 2019, the Company was named in two additional Connecticut lawsuits: the City of Middletown and the Town of Wethersfield. These cases were both also transferred to the MDL in July 2019. Finally, on January 15, 2020, the Town of Windham, Connecticut filed a lawsuit that names the Company, among other pharmaceutical manufacturers, in Connecticut Superior Court. The lawsuit alleges violations of fraud, public nuisance, negligent misrepresentation, and violations of state consumer protection laws. On March 3, 2020, the lawsuit was transferred to the MDL. Each of the lawsuits in the MDL naming the Company seeks, generally, penalties and injunctive relief. None of the lawsuits naming the Company are designated as representative cases in the MDL, and therefore, are effectively currently stayed. Outside of the MDL, there are several cases pending against the Company in state courts in Pennsylvania and Massachusetts: ● lawsuits naming the Company have been consolidated for discovery purposes in the Delaware County Court of Common Pleas as part of a consolidated proceeding of similar lawsuits brought by numerous Pennsylvania counties against other pharmaceutical manufacturers and distributors. These include lawsuits filed between May 2018 and July 2019 on behalf of Bucks County, Clinton County, Mercer County, Warrington Township, Warminster Township, and the City of Lock Haven, each of Pennsylvania, alleging claims related to opioid marketing and distribution, including negligence, fraud, unjust enrichment, public nuisance, and violations of state consumer protections laws. ● On December 24, 2021, the Company entered into a settlement framework with Scott+Scott Attorneys at Law, LLP (the “Scott Firm”), the law firm representing plaintiffs in each of the 27 cases described above. Pursuant to the terms of the settlement framework, which is subject to approval by all parties of a final settlement agreement, the Company will pay an aggregate amount not to exceed $2,750,000 in exchange for the dismissal, with prejudice, of each plaintiff’s lawsuit against the Company and a release of claims related to such lawsuits. The Company has entered into this settlement framework to efficiently resolve this litigation and does not admit any liability or acknowledge any wrongdoing in connection with such settlement framework. The Company currently expects to execute a final settlement agreement and make the corresponding payment during the first quarter of 2022. Opioid-Related Request and Subpoenas The Company, like a number of other pharmaceutical companies, has received subpoenas or civil investigative demands related to opioid sales and marketing. The Company has received such subpoenas or civil investigative demands from the Offices of the Attorney General of each of Washington, New Hampshire, Maryland and Massachusetts. On December 16, 2021, the Company entered into an Assurance of Discontinuance with the Massachusetts Attorney General (the “AoD”). Pursuant to the AoD, the Company provided certain assurances and agreed to pay the Massachusetts Attorney General $185,000, including $65,000 relating to that office’s costs of investigation, in exchange for closure of the investigation and a release of claims pertaining to the subject matter of the investigation. The Company is currently cooperating with each of the foregoing states in their respective investigations. |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2021 | |
DEBT | |
DEBT | 12. DEBT Pharmakon Term Notes On February 6, 2020, in connection with the execution of the Nucynta Purchase Agreement, the Company, together with its subsidiary, Collegium Securities Corporation, entered into a Loan Agreement (the “Loan Agreement”) with BioPharma Credit PLC, as collateral agent and lender, and BioPharma Credit Investments V (Master) LP, as lender (collectively “Pharmakon”). The Loan Agreement provides for a $200,000 secured term loan (the “term notes”), the proceeds of which were used to finance a portion of the purchase price paid pursuant to the Nucynta Purchase Agreement. O n February 13, 2020 , the Company received the net proceeds. The term notes bear interest at a rate based upon the three-month LIBOR rate, subject to a LIBOR floor of 2.0%, plus a margin of 7.5% per annum, payable quarterly in arrears. The Company is required to repay the term notes by making equal quarterly payments of principal beginning in the first quarter immediately following the third month anniversary of the Closing Date. The term notes will mature on the calendar quarter end immediately following the 48-month anniversary of the Closing Date and is guaranteed by the Company’s material domestic subsidiaries and also secured by substantially all of the Company’s material assets. On the Closing Date, the Company paid to Pharmakon a facility fee equal to 2.50% of the aggregate principal amount of the term notes, or $5,000, in addition to $427 of other expenses incurred by Pharmakon and reimbursed by the Company (together, the “discount”). Net proceeds of $194,573 were transferred to Assertio by the Company as agent in partial satisfaction of the Nucynta Purchase Agreement. In addition, the Company capitalized $2,456 of term notes issuance costs, related to legal and advisory fees. Except with respect to certain prepayments made with the proceeds from new equity issuances as described below, the Loan Agreement permits voluntary prepayment at any time, subject to a prepayment premium. The prepayment premium is equal to 3.00% of the principal amount being prepaid prior to the second-year anniversary of the Closing Date, 2.00% of the principal amount being prepaid on or after the second-year anniversary, but on or prior to the third-year anniversary, of the Closing Date, and 1.00% of the principal amount being prepaid on or after the third-year anniversary of the Closing Date, but prior to the fourth-year anniversary of the Closing Date. The Loan Agreement also includes a make-whole premium if there is a voluntary prepayment, a prepayment due to a change in control or acceleration following an Event of Default on or prior to the second-year anniversary of the Closing Date in an amount equal to foregone interest from the date of prepayment through the second-year anniversary of the Closing Date. A change of control triggers a mandatory prepayment of the term notes. The Loan Agreement also permits single voluntary prepayments of the Loan Agreement of less than or equal to $50,000 made solely from the proceeds of an equity issuance by the Company. If equity prepayment occurs prior to the second- year anniversary of the Closing Date, a prepayment premium of 5.00% would apply, with no make-whole premium. The Loan Agreement contains certain covenants and obligations of the parties, including, without limitation, covenants that require the Company to maintain $200,000 in annual net sales and covenants that limit the Company’s ability to incur additional indebtedness or liens, make acquisitions or other investments or dispose of assets outside the ordinary course of business, restrictions which limit the Company’s ability to pay dividends and restrictions of net assets of subsidiaries. The Loan Agreement also contains customary events of default, including payment defaults, breaches of covenants, change of control and a material adverse change default. Failure to comply with these covenants would constitute an event of default under the Loan Agreement, notwithstanding the Company’s ability to meet its debt service obligations. The Loan Agreement also includes various customary remedies for Pharmakon following an event of default, including the acceleration of repayment of outstanding amounts under the Loan Agreement and execution upon the collateral securing obligations under the Loan Agreement. Under certain circumstances, a default interest rate will apply on outstanding obligations during the occurrence and continuance of an event of default. During the years ended December 31, 2021, 2020, and 2019, the Company recognized interest expense of $16,339, $19,034, and zero , respectively, related to the term notes. As of December 31, 2021, principal repayments under the term notes are estimated to be paid as follows: Years ended December 31, Principal Payments 2022 $ 50,000 2023 50,000 2024 12,500 Total before unamortized discount and issuance costs $ 112,500 Less: unamortized discount and issuance costs (2,481) Total term notes $ 110,019 Silicon Valley Bank Term Loan Facility From August 2012 until January 2020, the Company maintained a term loan facility with Silicon Valley Bank (“SVB”), which was amended in connection with, and as a condition to, consummation of the transactions contemplated by the Nucynta Commercialization Agreement. Under the amended term loan (“Consent and Amendment”), the Company had a term loan facility in an amount of $11,500, which replaced the Company’s previously existing term loan facility. The proceeds of the Consent and Amendment were used to finance certain payment obligations under the Nucynta Commercialization Agreement and to repay the balance of the previously existing term loan. The Consent and Amendment bore interest at a rate per annum of 0.75% above the prime rate (as defined in the Consent and Amendment). The Company was eligible to repay the Consent and Amendment in equal consecutive monthly installments of principal plus monthly payments of accrued interest, commencing in January 2020. In January 2020, the Company prepaid the outstanding principal and accrued interest on the Consent and Amendment along with the required prepayment fees. The loss on extinguishment of the term loan was immaterial and was recorded as a component of interest expense. Convertible Senior Notes On February 13, 2020, the Company issued 2.625% convertible senior notes due in 2026 (the “convertible notes”) in the aggregate principal amount of $143,750, in a public offering registered under the Securities Act of 1933, as amended. The convertible notes were issued in connection with funding the Nucynta Acquisition, and the proceeds of the convertible notes were used to finance a portion of the purchase price payable pursuant to the Nucynta Purchase Agreement. Some of the Company’s existing investors participated in the convertible notes offering. The Company may, at its option, settle the convertible notes in cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock. Accordingly, the Company separately accounted for the liability component (the “Liability Component”) and the embedded derivative conversion option (the “Equity Component”) of the convertible notes by allocating the proceeds between the Liability Component and the Equity Component. In connection with the issuance of the convertible notes, the Company incurred approximately $5,473 of debt issuance costs, which primarily consisted of underwriting, legal and other professional fees, and allocated these costs between the Liability Component and the Equity Component based on the allocation of the proceeds. Of the total debt issuance costs, $1,773 was allocated to the Equity Component and recorded as a reduction to additional paid-in capital and $3,700 was allocated to the Liability Component and recorded as a debt discount of the convertible notes. The portion allocated to the Liability Component is amortized to interest expense using the effective interest method over six years. Prior to the adoption of ASU 2020-06 on January 1, 2021, the initial carrying amount of the Liability Component of $97,200 was calculated by measuring the fair value of a similar liability that does not have an associated convertible feature. The allocation was performed in a manner that reflected the Company’s non-convertible borrowing rate for similar debt. The Equity Component of the convertible notes of $46,550 was recognized as a debt discount. The excess of the principal amount of the Liability Component over its carrying amount was amortized to interest expense using the effective interest method over six years. Subsequent to the adoption of ASU 2020-06 on January 1, 2021, which the Company elected to adopt using the modified retrospective method, the Company removed the impact of recognizing the Equity Component of the senior convertible notes (at issuance and the subsequent accounting impact of additional interest expense from debt discount amortization). The cumulative effective of the accounting change as of January 1, 2021 was an increase to the carrying amount of the convertible notes of $39,489, a reduction to accumulated deficit of $5,288, and a reduction to additional paid-in capital of $44,777. The convertible notes are the Company’s senior unsecured obligations and bear interest at a rate of 2.625% per year payable semi-annually in arrears on February 15 and August 15 of each year, beginning on August 15, 2020. Before August 15, 2025, noteholders will have the right to convert their notes only upon the occurrence of certain events. From and after August 15, 2025, noteholders may convert their notes at any time at their election until the close of business on the scheduled trading day immediately before the maturity date. The Company will settle conversions by paying or delivering, as applicable, cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, at the Company’s election. The notes will mature on February 15, 2026, unless earlier repurchased, redeemed or converted. The initial conversion rate is 34.2618 shares of common stock per $1 principal amount of notes, which represents an initial conversion price of approximately $29.19 per share of common stock. The conversion rate and conversion price are subject to adjustment upon the occurrence of certain events. Holders of the convertible notes may convert all or any portion of their convertible notes, in multiples of $1 principal amount, at their option only under the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on March 31, 2020, if the last reported sale price per share of the Company’s common stock exceeds 130% of the conversion price for at least 20 trading days during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter; (2) during the five consecutive business days immediately after any 10 consecutive trading day period (such 10 consecutive trading day period, the “measurement period”) in which the “trading price” per $1 principal amount of the Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price per share of the Company’s common stock on such trading day and the conversion rate on such trading day; (3) upon the occurrence of certain corporate events or distributions on the Company’s common stock; (4) if the Company calls the convertible notes for redemption; or (5) at any time from, and including, August 15, 2025 until the close of business on the scheduled trading day immediately before the maturity date. As of December 31, 2021, none of the above circumstances had occurred and as such, the convertible notes could not have been converted. The Company may not redeem the convertible notes prior to February 15, 2023. On or after February 15, 2023, the Company may redeem the convertible notes, in whole and not in part, at a cash redemption price equal to the principal amount of the Notes to be redeemed, plus accrued and unpaid interest, if any, only if the last reported sale price per share of the Company’s common stock exceeds 130% of the conversion price on: (1) each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the trading day immediately before the date the Company sends the related redemption notice; and (2) the trading day immediately before the date the Company sends such notice. Calling any convertible note for redemption will constitute a make-whole fundamental change with respect to that convertible note, in which case the conversion rate applicable to the conversion of that convertible note, if it is converted in connection with the redemption, will be increased in certain circumstances for a specified period of time. The convertible notes have customary default provisions, including (i) a default in the payment when due (whether at maturity, upon redemption or repurchase upon fundamental change or otherwise) of the principal of, or the redemption price or fundamental change repurchase price for, any note; (ii) a default for 30 days in the payment when due of interest on any note; (iii) a default in the Company’s obligation to convert a note in accordance with the indenture; (iv) a default with respect to the Company’s obligations under the indenture related to consolidations, mergers and asset sales; (v) certain payment or other defaults by the Company or certain subsidiaries with respect to mortgages, agreements or other instruments for indebtedness for money borrowed of at least $20,000 ; and (vi) certain events of bankruptcy, insolvency and reorganization with respect to the Company or any of its significant subsidiaries. As of December 31, 2021, the convertible notes outstanding consisted of the following: Principal $ 143,750 Less: unamortized issuance costs (3,784) Net carrying amount $ 139,966 The Company determined the expected life of the convertible notes was equal to its six-year term. Subsequent to the adoption of ASU 2020-06, the effective interest rate on the convertible notes was 3.26%. As of December 31, 2021, the if-converted value did not exceed the remaining principal amount of the convertible notes. The following table presents the total interest expense recognized related to the convertible notes during the years ended December 31, 2021 and 2020: Years ended December 31, 2021 2020 Contractual interest expense $ 3,773 $ 3,323 Amortization of debt discount — 5,628 Amortization of debt issuance costs 902 447 Total interest expense $ 4,675 $ 9,398 As of December 31, 2021, the future minimum payments on the convertible notes were as follows: Years ended December 31, Future Minimum Payments 2022 $ 3,773 2023 3,773 2024 3,773 2025 3,773 2026 145,638 Total minimum payments $ 160,730 Less: interest (16,980) Less: unamortized issuance costs (3,784) Convertible senior notes $ 139,966 |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2021 | |
LEASES | |
LEASES | 13. LEASES Operating Lease Arrangements In March 2018, the Company entered into an operating lease for its new corporate headquarters (the “Stoughton Lease”) pursuant to which the Company leases approximately 50,678 of rentable square feet of space, in Stoughton, Massachusetts. The Stoughton Lease commenced in August 2018 when the Company took possession of the space. After the initial four-month free rent period following possession of the space, the operating lease will continue for a term of 10 years. The Company has the right to extend the term of the Stoughton Lease for two additional five-year terms, provided that written notice is provided to the landlord no later than 12 months prior to the expiration of the then current Stoughton Lease term. The Company did not believe the exercise of the extension to be reasonably certain as of the lease commencement date and therefore, did not include the extension as part of its recognized lease asset and lease liability. The annual base rent is $1,214, or $23.95 per rentable square foot, and will increase annually by 2.5% to 3.1% over the subsequent years. In January 2016, the Company entered a non-cancellable contract with the contract manufacturing organization (“CMO”) of Xtampza ER. The contract term continues through December 2022 and automatically renews for successive two-year terms unless either party gives written notice of termination two-years in advance. Xtampza ER production is currently conducted in an area of the manufacturing plant that is shared with other clients. Pursuant to the terms of the agreement, since 2016 the CMO has reserved 3,267 square feet of existing manufacturing space for a dedicated manufacturing suite for Xtampza ER, which was put into service in the year ended December 31, 2020. As the Company can direct the use of the dedicated manufacturing suite and obtain substantially all the economic benefits of the dedicated space, the Company determined that the arrangement was an embedded operating lease. The Company expects the lease term to continue at least through December 2026 and separated the agreement’s lease and non-lease components in determining the operating lease assets and liabilities. The Company determined its best estimate of stand-alone prices for each of the lease and nonlease components by considering observable information including gross margins expected to be recovered from the Company’s service provider and terms of similar lease contracts. As of December 31, 2021, the Company had operating lease assets of $7,644 and operating lease liabilities of $8,765 primarily related to operating lease agreements for its corporate headquarters. Short-Term Lease Arrangements In December 2018, the Company began entering into 12-month, non-cancelable vehicle leases for its field-based employees. Each vehicle lease is executed separately and expires at varying times with automatic renewal options that are cancelable at any time. The rent expense for these leases is therefore recognized on a straight-line basis over the lease term in the period in which it is incurred. Variable Lease Costs Variable lease costs primarily include utilities, property taxes, and other operating costs that are passed on from the lessor. The components of lease cost for the years ended December 31, 2021, 2020, and 2019 are as follows: Years ended December 31, 2021 2020 2019 Lease Cost Operating lease cost $ 1,305 $ 1,305 $ 1,446 Short-term lease cost 1,492 1,312 752 Variable lease cost 292 331 283 Total lease cost $ 3,089 $ 2,948 $ 2,481 The lease term and discount rate for operating leases for the years ended December 31, 2021 and 2020 are as follows: As of December 31, Lease Term and Discount Rate: 2021 2020 Weighted-average remaining lease term — operating leases (years) 7.6 8.6 Weighted-average discount rate — operating leases 6.1% 6.1% Other information related to operating leases for the years ended December 31, 2021, 2020, and 2019 is as follows: Years ended December 31, Other Information: 2021 2020 2019 Cash paid for amounts included in the measurement of operating leases liabilities $ 1,286 $ 1,249 $ 1,133 Leased assets obtained in exchange for new operating lease liabilities — — — The Company’s aggregate future minimum lease payments for its operating leases, including embedded operating lease arrangements, as of December 31, 2021, are as follows: 2022 $ 1,325 2023 1,363 2024 1,401 2025 1,439 2026 1,477 After 2026 4,060 Total minimum lease payments $ 11,065 Less: Present value discount 2,300 Present value of lease liabilities $ 8,765 |
EQUITY
EQUITY | 12 Months Ended |
Dec. 31, 2021 | |
EQUITY | |
EQUITY | 14. EQUITY Common Stock In May 2015, the Company adopted the Amended and Restated 2014 Stock Incentive Plan (the “Plan”), under which an aggregate of 2,700,000 shares of common stock were authorized for issuance to employees, officers, directors, consultants and advisors of the Company, plus an annual increase on the first day of each fiscal year until the expiration of the Plan equal to 4% of the total number of outstanding shares of common stock on December 31st of the immediately preceding calendar year (or a lower amount as otherwise determined by the Company’s board of directors (“Board of Directors”) prior to January 1st). As of December 31, 2021, there were 1,588,735 shares of common stock available for issuance pursuant to the Plan. The Plan provides for granting of both Internal Revenue Service qualified incentive stock options and non-qualified options, restricted stock awards, restricted stock units and performance stock units. The Company’s qualified incentive stock options, non-qualified options and restricted stock units generally vest ratably over a four-year period of service. The stock options generally have a ten-year contractual life and, upon termination, vested options are generally exercisable between one and three months following the termination date, while unvested options are forfeited immediately upon termination. Refer to Note 15 Stock-based Compensation Warrants In connection with execution of the Third Amendment to the Nucynta Commercialization Agreement, the Company issued a warrant to Assertio to purchase 1,041,667 shares of common stock of the Company (the “Warrant”) at an exercise price of $19.20 per share. The Warrant will expire in November 2022 and includes customary adjustments for changes in the Company’s capitalization. As of December 31, 2021, the Warrant was the Company’s only outstanding warrant. Share Repurchases In August 2021, the Company’s board of directors authorized the Repurchase Program to repurchase up to $100,000 of outstanding shares of the Company’s common stock at any time or times through December 31, 2022. The Repurchase Program permits the Company to effect repurchases through a variety of methods, including open-market purchases (including pursuant to a trading plan adopted in accordance with Rule 10b5-1 of the Exchange Act), privately negotiated transactions, or otherwise in compliance with Rule 10b-18 of the Exchange Act. Shares repurchased under the Repurchase Program will return to the Company’s pool of authorized but unissued shares available for reissuance. The timing and amount of any such repurchases will be determined based on share price, market conditions, legal requirements, and other relevant factors. The Repurchase Program can be discontinued at any time. There can be no assurance as to the timing or number of shares of any repurchases in the future. In October 2021, the Company’s board of directors authorized an ASR Program to repurchase $25,000 of the Company’s common stock, as part of the Company’s existing $100,000 Repurchase Program. Under the terms of the Company's ASR agreement with an investment bank (the “ASR Agreement”), the Company paid $25,000 on November 15, 2021, and received 1,026,694 shares, representing 80% of the upfront payment on a price per share of $19.48, the closing price on the date the agreement was executed. The remaining shares purchased by the Company was based on the volume-weighted average price of its common stock through January 7, 2022, minus an agreed upon discount between the parties. On January 7, 2022, the ASR Agreement settled and the Company received an additional 307,132 shares, bringing the total shares repurchased pursuant to the ASR Agreement to 1,333,826. The ASR Agreement was accounted for as two separate transactions (1) a repurchase of common stock in a treasury stock transaction recorded on November 15, 2021 and (2) a forward contract indexed to the Company’s own common stock which settled on January 7, 2022. The forward contract for the purchase of the remaining $5,000, representing remaining shares to be delivered by the investment bank under the ASR Agreement, was recorded as a reduction to stockholders’ equity as of December 31, 2021. Forward contracts to repurchase a variable number of the Company’s equity shares that require physical settlement are accounted for in conformity with guidance in ASC 815-10-15. Under ASC 815-10-15-74, contracts issued or held by a company that are both (1) indexed to its own stock and (2) classified in stockholders’ equity in its statement of financial position are not considered to be derivative instruments. Based on the transaction structure, the Company concluded that the forward purchase contract portion of the Company’s ASR Agreement satisfied these criteria and accordingly was classified as an equity instrument. In accordance with ASC 260-10-55-88, the above-noted treasury stock acquisition resulted in an immediate reduction of 1,026,694 shares from the outstanding shares used to calculate the weighted-average common shares outstanding for both basic and diluted earnings per share. The forward contract was outstanding as of December 31, 2021. As the Company is entitled to receive additional shares of its common stock in connection with the outstanding forward contract, the receipt of additional shares of common stock would be antidilutive. Therefore, no adjustments were made in the computation of earnings per share for the period the forward was outstanding. As of December 31, 2021, we repurchased 2,150,717 shares at a weighted-average price of $19.93 per share for a total of $42,861 under the Repurchase Program and the cost of repurchased shares were recorded as treasury stock in the condensed consolidated Balance Sheet. As of December 31, 2021, $57,139 remained available for share repurchases under the Repurchase Program. |
STOCK - BASED COMPENSATION
STOCK - BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2021 | |
STOCK - BASED COMPENSATION | |
STOCK - BASED COMPENSATION | 15. STOCK-BASED COMPENSATION Performance Share Units, Restricted Stock Units and Stock Options Performance Share Units The Company periodically grants performance share units (“PSUs”) to certain members of the Company's senior management team. PSUs vest subject to the satisfaction of annual and cumulative performance and/or market conditions established by the Compensation Committee. In January 2019, the Company granted PSUs with performance conditions related to 2019, 2020, 2021 and three-year cumulative revenue goals for Xtampza ER. The PSUs were to vest following a three-year performance period, subject to the satisfaction of the performance criteria and the executive’s continued employment through the performance period. PSUs may vest in a range between 0% and 200% , based on the satisfaction of performance criteria, and no shares will be issued if the minimum applicable performance metric is not achieved. The Company recognizes compensation expense ratably over the required service period based on its estimate of the number of shares that will vest based upon the probability of achieving the performance metrics. During the year ended December 31, 2021, the Company adjusted cumulative compensation expense based on the number of shares that vested. Beginning in February 2020 and subsequently in 2021, the Company granted PSUs with performance criteria related to the relative ranking of the total stockholder return (“TSR”) of the Company’s common stock for each individual year within a three-year performance period as well as the cumulative three-year performance period return relative to the TSR of certain peer companies within the S&P Pharmaceutical Select Industry Index. TSR will be measured based on the 30-day average stock price on the first day of each period compared to the 30-day average stock price on the last day of each period. The PSUs subject to the annual performance criteria will vest annually, subject to the satisfaction of the performance criteria and the executive’s continued employment through the performance period. The cumulative PSUs will vest following the three-year performance period, subject to the satisfaction of the performance criteria and the executive’s continued employment through the performance period. PSUs may vest in a range between 0% and 200% , based on the satisfaction of performance, and no shares will be issued if the minimum applicable performance metric is not achieved. As these PSUs vest based on the achievement of market conditions, the grant date fair values were determined using a Monte-Carlo valuation model. The Monte-Carlo valuation model considered a variety of potential future share prices for the Company as well as its peer companies in the selected market index. In December 2020, the Company’s board of directors approved a modification of PSUs that were originally granted to the Company’s senior management team in January 2019. The modification replaced the original performance criteria for the 2020, 2021 and cumulative performance periods from being based on Xtampza 2020, 2021 and three-year cumulative revenue goals to being based on TSR for 2020, 2021 and the corresponding two-year cumulative period. The PSUs achieved based on 2019 Xtampza revenues goals were not changed as part of the modification. The Company accounted for this modification under ASC 718, and, per guidance, determined the modification created incremental value as the fair value of these awards was increased upon modification. The increase in fair value resulted in an accelerated recognition of stock-based compensation expense on the modification date of $906. The total expense for these PSUs in years ended December 31, 2021, 2020, and 2019 was $289, $950 and $136, respectively. A summary of the Company’s performance share units activity for the year ended December 31, 2021 and related information is as follows: Weighted-Average Shares Grant Date Fair Value Outstanding at December 31, 2020 283,223 $ 24.26 Granted 231,180 35.15 Vested (66,974) 22.35 Forfeited (81,720) 30.66 Performance adjustment (12,609) 21.80 Outstanding at December 31, 2021 353,100 $ 31.77 The number of PSUs awarded represents the target number of shares of common stock that may be earned; however, the actual number of shares earned may vary based on the satisfaction of performance criteria. The weighted-average grant date fair value of PSUs granted for the years ended December 31, 2021, 2020, and 2019 was $35.15, $28.49, and $15.90, respectively. For the years ended December 31, 2021, 2020, and 2019, the stock-based compensation expense for PSUs was $4,817, $3,551, and $136, respectively. As of December 31, 2021, the unrecognized compensation cost related to performance share units was $4,443 and is expected to be recognized as expense over approximately 2.0 years. Restricted Stock Units A summary of the Company’s restricted stock units (“RSUs”) activity for the year ended December 31, 2021 and related information is as follows: Weighted-Average Shares Grant Date Fair Value Outstanding at December 31, 2020 1,242,387 $ 19.42 Granted 1,373,031 24.23 Vested (444,769) 19.17 Forfeited (550,626) 22.63 Outstanding at December 31, 2021 1,620,023 $ 22.48 The weighted-average grant date fair value of RSUs granted for the years ended December 31, 2021, 2020 and 2019 was $24.23, $21.35 and $15.38. The total fair value of RSUs vested (measured on the date of vesting) for the years ended December 31, 2021, 2020 and 2019 was $11,165, $6,992 and $2,683, respectively. As of December 31, 2021, the unrecognized compensation cost related to restricted stock units was $24,936 and is expected to be recognized as expense over approximately 2.7. The weighted-average grant date fair value of restricted stock units vested during the years ended December 31, 2021, 2020, and 2019 was $8,526, $5,989, and $4,066, respectively. Stock Options The Company granted stock options to employees for the years ended December 31, 2021, 2020 and 2019. The Company estimates the fair value of stock options as of the date of grant using the Black-Scholes option pricing model and restricted stock awards and restricted stock units based on the fair value of the award. A summary of the Company’s stock option activity for the year ended December 31, 2021 and related information is as follows: Weighted- Weighted- Average Average Remaining Aggregate Exercise Price Contractual Intrinsic Shares per Share Term (in years) Value Outstanding at December 31, 2020 3,860,481 $ 17.78 7.2 $ 13,011 Granted 90,000 21.03 Exercised (803,485) 14.78 Cancelled (418,827) 20.65 Outstanding at December 31, 2021 2,728,169 $ 18.33 5.8 $ 6,070 Exercisable at December 31, 2021 2,220,889 $ 18.26 5.3 $ 5,262 The weighted-average assumptions used in the Black-Scholes option pricing model to determine the fair value of the employee stock option grants were as follows: Year ended December 31, 2021 2020 2019 Risk-free interest rate 0.7 % 1.3 % 2.4 % Volatility 67.2 % 66.2 % 63.3 % Expected term (years) 6.0 6.0 6.1 Expected dividend yield — % — % — % Risk-free Interest Rate. Expected Volatility. Expected Term. Expected Dividend Yield. The weighted-average grant date fair value of stock options granted for the years ended December 31, 2021, 2020, and 2019 was $12.60, $12.78 and $9.07 respectively. The total intrinsic value of stock options exercised for the years ended December 31, 2021, 2019, and 2018 was $6,456, $7,516 and $1,506, respectively. As of December 31, 2021, the unrecognized compensation cost related to outstanding options was $5,096 and is expected to be recognized as expense over approximately 1.9 years. Employee Stock Purchase Plan The Company’s 2015 Employee Stock Purchase Plan allows employees as designated by the Company’s Board of Directors to purchase shares of the Company’s common stock. The purchase price is equal to 85% of the lower of the closing price of the Company’s common stock on (1) the first day of the purchase period or (2) the last day of the purchase period. During the year ended December 31, 2021, 43,719 shares of common stock were purchased for total proceeds of $755. As of December 31, 2021, there were 1,618,246 shares of common stock authorized for issuance pursuant to the employee stock purchase plan. The expense for the years ended December 31, 2021, 2020 and 2019 was $224, $342 and $358 respectively. Stock-Based Compensation Expense Stock-based compensation for all stock options, restricted stock awards, restricted stock units, performance share units and for the employee stock purchase plan are reported within the following: Years ended December 31, 2021 2020 2019 Research and development $ 3,422 3,909 $ 2,126 Selling, general and administrative 20,833 18,001 14,402 Total stock-based compensation expense $ 24,255 $ 21,910 $ 16,528 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2021 | |
INCOME TAXES | |
INCOME TAXES | 16. INCOME TAXES For the years ended December 31, 2021 and 2020, the Company recorded a benefit from income taxes of $74,891 and provision for income taxes of $830, respectively. For the year ended December 31, 2019, the Company did not record a current or deferred income tax provision or (benefit) due to current and historical losses incurred by the Company. The Company's losses before income taxes consisted solely of losses from domestic operations. The provision for (benefit from) income taxes contained the following components: Year Ended December 31, 2021 2020 2019 Current provision (benefit): Federal $ — $ — $ — State 3,142 830 — 3,142 830 — Deferred provision (benefit): Federal $ (61,445) $ — $ — State (16,588) — — (78,033) — — Income tax provision (benefit) $ (74,891) $ 830 $ — A reconciliation of income tax expense (benefit) computed at the statutory federal income tax rate to income taxes as reflected in the consolidated financial statements is as follows: As of December 31, 2021 2020 2019 Federal income tax expense at statutory rate 21.0 % 21.0 % 21.0 % (Increase) decrease income tax (benefit) resulting from: State income tax, net of federal benefit 2.9 5.1 5.6 Permanent differences (3.9) 1.1 (1.4) Stock compensation (18.8) (3.0) (1.8) Research and development credit 16.3 (1.1) 1.8 Change in valuation allowance 2,202.5 (20.1) (25.2) Effective income tax rate 2,220.0 % 3.0 % — % Deferred taxes are recognized for temporary differences between the basis of assets and liabilities for financial statement and income tax purposes. The significant components of the Company’s deferred tax assets and liabilities are comprised of the following: As of December 31, 2021 2020 Deferred tax assets: U.S. and state net operating loss carryforwards $ 31,400 $ 57,457 Research and development credits 5,470 5,004 Operating lease liabilities 2,321 2,508 Returns and discounts 23,072 6,281 Stock-based compensation 7,838 7,133 Accruals and other 2,210 1,892 Intangible assets 12,699 1,297 Gross deferred tax assets: 85,010 81,572 Valuation allowance (1,966) (65,661) Total deferred tax assets: 83,044 15,911 Deferred tax liabilities: Debt discount — (10,809) Operating lease assets (2,024) (2,217) Depreciation (2,978) (2,885) Net deferred tax assets $ 78,042 $ — The Company provides a valuation allowance when it is more likely than not that deferred tax assets will not be realized. In determining the extent to which a valuation allowance for deferred tax assets is required, the Company evaluates all available evidence including projections of future taxable income, carry back opportunities, reversal of certain deferred tax liabilities, and other tax planning strategies. Prior to generating income during the year ended December 31, 2020, the Company had a history of operating losses and a valuation allowance was maintained on the majority of the Company's deferred tax assets through March 31, 2021. As a result of sustained positive earnings history through cumulative earnings over the last three years , as of June 30, 2021, the Company began using projections of future taxable income as a source of realizing its deferred tax assets. Accordingly, the Company released the portion of the valuation allowance on deferred tax assets expected to be realized through future earnings in the three months ended June 30, 2021. The Company recognized a deferred tax benefit of $78,042 for the year ended December 31, 2021. The net operating losses expected to be recovered through ordinary income in the year ended December 31, 2021 are included in the annual effective tax rate. The Company has maintained a valuation allowance on the portion of its deferred tax assets that are not more likely than not to be realized due to tax limitation or other conditions of $1,966 as of December 31, 2021. As of December 31, 2021, 2020, and 2019, the Company had gross U.S. federal net operating loss carryforwards of $119,280, $226,824, and $292,342, respectively, which may be available to offset future income tax liabilities. The Tax Cuts and Jobs Act of 2017 (“TCJA”) will generally allow losses incurred after 2017 to be carried over indefinitely but will generally limit the NOL deduction to the lesser of the NOL carryover or 80% of a corporation’s taxable income (subject to Internal Revenue Code Sections 382 and 383). Also, there will be no carryback for losses incurred after 2017. Losses incurred prior to 2018 will generally be deductible to the extent of the lesser of a corporation’s NOL carryover or 100% of a corporation’s taxable income (subject to Internal Revenue Code Section 382 and 383) and be available for twenty years from the period the loss was generated. As of December 31, 2021, 2020, and 2019, the Company also had gross U.S. state net operating loss carryforwards of $103,044, $170,280, and $222,629, respectively, which may be available to offset future income tax liabilities and expire at various dates through 2036. As of December 31, 2021, 2020 and 2019, the Company had federal research and development tax credit carryforwards of approximately $4,503, $4,623, and $4,044, respectively, available to reduce future tax liabilities which expire at various dates through 2036. As of December 31, 2021, 2020 and 2019 the Company had state research and development tax credit carryforwards of approximately $955, $1,150, and $1,112, respectively, available to reduce future tax liabilities which expire at various dates through 2036. Under the provisions of the Internal Revenue Code, the net operating loss and tax credit carryforwards are subject to review and possible adjustment by the Internal Revenue Service and state tax authorities. Net operating loss and tax credit carryforwards may become subject to an annual limitation in the event of certain cumulative changes in the ownership interest of significant shareholders over a three-year period in excess of 50%, as defined under Sections 382 and 383 of the Internal Revenue Code, respectively, as well as similar state provisions. During 2020, the Company completed an updated study to assess the impact of ownership changes, if any, on the Company’s ability to use its NOL and tax credit carryovers as defined under Section 382 of the Internal Revenue Code (“IRC 382”). As a result of the study, the Company concluded that there were ownership changes that occurred during the years 2006, 2012 and 2015 that could be subject to IRC 382 limitations. These IRC 382 annual limitations may limit the Company’s ability to use pre-ownership change federal NOL carryovers and pre-ownership change federal tax credit carryovers, which may potentially increase the Company’s future federal income tax liability. The Company files income tax returns in the United States and in several states. The federal and state income tax returns are generally subject to tax examinations for the tax years ended December 31, 2018 through December 31, 2021. To the extent the Company has tax attribute carryforwards, the tax years in which the attribute was generated may still be adjusted upon examination by the Internal Revenue Service or state tax authorities to the extent utilized in a future period. For all years through December 31, 2021, the Company generated research credits but has not conducted a study to document the qualified activities. This study may result in an adjustment to the Company’s research and development credit carryforwards. The Company has reduced its deferred tax asset for its estimate of credits that could be reduced, and that is included in the tabular rollforward of uncertain tax positions. A reconciliation of the beginning and ending amount of gross unrecognized tax benefits (“UTB”) is as follows: As of December 31, 2021 2020 2019 Gross UTB Balance at January 1 $ 586 $ 578 $ 502 Additions based on tax positions related to the current year 67 36 76 Additions for tax positions of prior years 1 — — Reductions for tax positions of prior years — (28) — Gross UTB Balance at December 31 $ 654 $ 586 $ 578 Net UTB impacting the effective tax rate at December 31 excluding valuation allowance impacts, if any $ 500 $ 560 $ 549 |
EMPLOYEE BENEFITS
EMPLOYEE BENEFITS | 12 Months Ended |
Dec. 31, 2021 | |
EMPLOYEE BENEFITS | |
EMPLOYEE BENEFITS | 17. EMPLOYEE BENEFITS The Company has a retirement savings plan, which is qualified under section 401(k) of the Code, for its employees. The plan allows eligible employees to defer, at the employee’s discretion, pretax compensation up to the Internal Revenue Service annual limits. Employees become eligible to participate starting on the first day of employment. The Company is not required to contribute to this plan. Total expense for contributions made by the Company for the years ended December 31, 2021, 2020 and 2019 was $1,236, $1,260, and $1,170 respectively. |
UNAUDITED QUARTERLY OPERATING R
UNAUDITED QUARTERLY OPERATING RESULTS | 12 Months Ended |
Dec. 31, 2021 | |
UNAUDITED QUARTERLY OPERATING RESULTS | |
UNAUDITED QUARTERLY OPERATING RESULTS | 18. UNAUDITED QUARTERLY OPERATING RESULTS The following is a summary of unaudited quarterly results of operations for the years ended December 31, 2021 and 2020: First Second Third Fourth Year ended December 31, 2021 Quarter Quarter Quarter Quarter (1) Product revenues, net $ 87,721 $ 82,942 $ 78,843 $ 27,362 Cost of product revenues Cost of product revenues (excluding intangible asset amortization) 15,328 15,908 15,934 11,900 Intangible asset amortization 16,795 16,795 16,796 16,795 Total cost of products revenues 32,123 32,703 32,730 28,695 Gross profit 55,598 50,239 46,113 (1,333) Operating expenses Research and development 2,930 3,462 1,450 1,609 Selling, general and administrative 31,476 30,368 30,514 26,602 Restructuring — — — 4,578 Total operating expenses 34,406 33,830 31,964 32,789 Income (loss) from operations 21,192 16,409 14,149 (34,122) Interest expense (5,721) (5,421) (5,115) (4,757) Interest income 3 3 3 3 Income (loss) before income taxes 15,474 10,991 9,037 (38,876) (Benefit from) provision for income taxes (188) (61,852) 991 (13,842) Net income (loss) $ 15,662 $ 72,843 $ 8,046 $ (25,034) Earnings (loss) per share — basic $ 0.45 $ 2.06 $ 0.23 $ (0.73) Weighted-average shares — basic 34,951,740 35,302,608 35,373,909 34,123,309 Earnings (loss) per share — diluted $ 0.41 $ 1.79 $ 0.22 $ (0.73) Weighted-average shares — diluted 41,160,092 41,286,853 36,261,174 34,123,309 First Second Third Fourth Year ended December 31, 2020 Quarter Quarter Quarter Quarter Product revenues, net $ 76,511 $ 78,058 $ 79,176 $ 76,271 Cost of product revenues Cost of product revenues (excluding intangible asset amortization) 27,229 12,899 14,188 15,184 Intangible asset amortization 10,295 16,795 16,795 16,795 Total cost of products revenues 37,524 29,694 30,983 31,979 Gross profit 38,987 48,364 48,193 44,292 Operating expenses Research and development 2,666 2,493 2,141 2,472 Selling, general and administrative 31,260 29,322 26,426 26,824 Total operating expenses 33,926 31,815 28,567 29,296 Income from operations 5,061 16,549 19,626 14,996 Interest expense (4,823) (8,259) (8,063) (7,737) Interest income 212 14 3 3 Income before income taxes 450 8,304 11,566 7,262 Provision for income taxes — 246 280 304 Net income $ 450 $ 8,058 $ 11,286 $ 6,958 Earnings per share — basic $ 0.01 $ 0.23 $ 0.33 $ 0.20 Weighted-average shares — basic 34,100,688 34,395,266 34,540,126 34,592,277 Earnings per share — diluted $ 0.01 $ 0.23 $ 0.32 $ 0.20 Weighted-average shares — diluted 35,069,693 35,091,906 35,069,188 35,417,623 (1) In the fourth quarter of 2021, product revenues, net included a $38,329 product revenue adjustment related to returns adjustments, of which $13,787 related to Xtampza revenue and $24,542 related to Nucynta Products revenue. In addition, selling general and administrative operating expense includes $2,935 of expense related to litigation settlements . |
BIODELIVERY SCIENCES INTERNATIO
BIODELIVERY SCIENCES INTERNATIONAL, INC. ACQUISITION | 12 Months Ended |
Dec. 31, 2021 | |
BIODELIVERY SCIENCES INTERNATIONAL, INC. ACQUISITION | |
BIODELIVERY SCIENCES INTERNATIONAL, INC. ACQUISITION | 19. BIODELIVERY SCIENCES INTERNATIONAL, INC. ACQUISITION On February 14, 2022, the Company and BioDelivery Sciences International, Inc. (NASDAQ: BDSI) announced the Merger Agreement pursuant to which Collegium will acquire BDSI for $5.60 per share in cash. The transaction, which has been unanimously approved by the boards of directors of both companies, is expected to close late in the first quarter 2022, subject to customary closing conditions, including receipt of required regulatory approvals and the tender of a majority of outstanding shares of BDSI’s common stock. Following the successful closing of the tender offer, the Company will acquire any shares of BDSI that are not tendered in the tender offer through a second-step merger at the same consideration as paid in the tender offer. In connection with the definitive agreement to acquire BDSI, Collegium entered into a commitment letter (the “Debt Commitment Letter” with Pharmakon Advisors, L.P. pursuant to which funds managed by Pharmakon Advisors, L.P. have committed, subject to customary conditions, to provide to Collegium a four (4) year senior secured term loan facility in an aggregate principal amount of $650 million (the “Term Facility”). Proceeds will be used to finance a portion of Collegium’s acquisition of BDSI, as well as to repay the outstanding debt of Collegium and BDSI and pay certain fees and expenses related thereto. Under the terms of the Debt Commitment Letter, the Term Facility will have $100 million in amortization payments during the first year and the remaining $550 million balance will amortize in equal quarterly installments over the remaining three (3) years. The loan will initially bear interest at 3-month LIBOR plus 7.50% per annum subject to a 1.20% floor, and Collegium will pay a one-time fee of 2% due at signing and 1% due at closing. The obligation of Pharmakon Advisors, L.P. to provide the financing under the Debt Commitment Letter is subject to a number of conditions, including the receipt by Pharmakon Advisors, L.P. of executed loan documentation, the accuracy of certain representations and warranties in all material respects and consummation of the transactions as contemplated by the Merger Agreement. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Accounting | Basis of Accounting The consolidated financial statements include the accounts of Collegium Pharmaceutical, Inc. as well as the accounts of its subsidiaries Collegium Securities Corp. (a Massachusetts corporation), incorporated in December 2015, and Collegium NF LLC (a Delaware limited liability company), incorporated in December 2017, both wholly owned subsidiaries requiring consolidation. The consolidated financial statements are prepared in conformity with generally accepted accounting principles in the United States of America (“GAAP”). All intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in accordance with GAAP requires the Company to make estimates and assumptions that impact the reported amounts of assets, liabilities, revenues, costs and expenses and the disclosure of contingent assets and liabilities in the Company’s consolidated financial statements and accompanying notes. Estimates in the Company’s consolidated financial statements include revenue recognition, including the estimates of product returns, discounts and allowances related to commercial sales of products, estimates of useful lives with respect to intangible assets, accounting for stock-based compensation, contingencies, impairment of intangible assets and tax valuation allowances. The Company bases estimates and assumptions on historical experience when available and on various factors that it believes to be reasonable under the circumstances. The Company evaluates its estimates and assumptions on an ongoing basis. The Company’s actual results may differ from these estimates under different assumptions or conditions. |
Fair Value Measurements | Fair Value Measurements Fair value measurements and disclosures describe the fair value hierarchy based on three levels of inputs as follows: Level 1 inputs: Quoted prices (unadjusted) in active markets for identical assets or liabilities Level 2 inputs: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly Level 3 inputs: Unobservable inputs that reflect the Company’s own assumptions about the assumptions market participants would use in pricing the asset or liability There were no transfers between Levels 1, 2 and 3 during the years ended December 31, 2021 and 2020. The following tables present the Company’s financial instruments carried at fair value using the lowest level input applicable to each financial instrument at December 31, 2021 and 2020. Significant Quoted Prices other Significant in active observable unobservable markets inputs inputs Total (Level 1) (Level 2) (Level 3) December 31, 2021 Money market funds, included in cash equivalents $ 45,078 $ 45,078 $ — $ — December 31, 2020 Money market funds, included in cash equivalents $ 45,069 $ 45,069 $ — $ — The Company’s cash equivalents, which consist of money market funds, are measured at fair value on a recurring basis using quoted market prices. Accordingly, these securities are categorized as Level 1. The Company’s convertible senior notes fall into the Level 2 category within the fair value level hierarchy. The fair value was determined based on data points other than quoted prices that are observable, either directly or indirectly, such as broker quotes in a non-active market. As of December 31, 2021, the convertible senior notes had a fair value of approximately $139,078 and a net carrying value of $139,966. The Company’s term notes fall into the Level 2 category within the fair value level hierarchy and the fair value was determined using quoted prices for similar liabilities in active markets, as well as inputs that are observable for the liability (other than quoted prices), such as interest rates that are observable at commonly quoted intervals. As of December 31, 2021, the carrying amount of the term notes reasonably approximated the estimated fair value. As of December 31, 2021, and December 31, 2020, the carrying amounts of the cash and cash equivalents, accounts receivable, prepaid expenses and other current assets, accounts payable, accrued expenses, and accrued rebates, returns and discounts, reasonably approximated the estimated fair values. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments, which potentially subject the Company to significant concentration of credit risk, consist primarily of cash and cash equivalents and accounts receivable. The Company maintains its cash deposits primarily with one reputable and nationally recognized financial institution. In addition, as of December 31, 2021, the Company’s cash equivalents were invested in money market funds. The Company has not experienced any material losses in such accounts and management believes that the Company is not exposed to significant credit risk due to the financial position of the financial institutions in which those deposits are held. Three customers comprised 10% or more of the Company’s accounts receivable balance as of December 31, 2021. These customers comprised 46%, 33% and 20% of the accounts receivable balance as of December 31, 2021; 46%, 34% and 17% as of December 31, 2020; and 51%, 27%, and 19% as of December 31, 2019. The same three customers comprised 10% or more of the Company’s revenue during the year ended December 31, 2021. These customers comprised 35%, 31% and 29% of revenue during the year ended December 31, 2021; 34%, 31% and 31% during the year ended December 31, 2020; and 34%, 31%, and 30% during the year ended December 31, 2019. To date, the Company has not experienced any credit losses with respect to the collection of its accounts receivable and has not recorded an allowance for credit losses as of December 31, 2021 or 2020. The Company has no financial instruments with off balance sheet risk of loss. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents include cash in readily available checking and savings accounts and money market funds. The Company considers all highly liquid investments with an original maturity of three months or less from the date of purchase to be cash equivalents. |
Restricted Cash | Restricted Cash Restricted cash is reported as non-current unless the restrictions are expected to be released in the next twelve months. As of December 31, 2021 and 2020, the Company had restricted cash of $2,547, which represents cash held in a depository account at a financial institution to collateralize conditional stand by letters of credit for the Company’s corporate credit card program, its lease of its corporate headquarters, and its leases of vehicles for its field-based employees. |
Inventory | Inventory Inventories are stated at the lower of cost or net realizable value. Inventory costs consist of costs related to the manufacturing of the Company’s products, which are primarily the costs of contract manufacturing and active pharmaceutical ingredient. The Company determines the cost of its inventories on a specific identification basis, and removes amounts from inventories on a first-in, first-out basis. If the Company identifies excess, obsolete or unsalable items, inventories are written down to their realizable value in the period in which the impairment is identified. These adjustments are recorded based upon various factors, including the level of product manufactured by the Company, the level of product in the distribution channel, current and projected demand and the expected shelf-life of the inventory components. As of December 31, 2021, cumulative estimates of excess inventory recorded as a component of cost of product revenues were immaterial. The Company outsources the manufacturing of Xtampza ER and the Nucynta Products to contract manufacturers that produce the finished product. In addition, the Company currently relies on a sole supplier for the active pharmaceutical ingredient in Xtampza ER and the Nucynta Products. Accordingly, the Company has concentration risk associated with its commercial manufacturing of Xtampza ER and the Nucynta Products. The Company has capitalized $17,394 of inventory as of December 31, 2021. The Company expects to use the inventory over its operating cycle. |
Property and Equipment | Property and Equipment Property and equipment, including leasehold improvements, are recorded at cost. Maintenance and repair costs are expensed as incurred. Costs which materially improve or extend the lives of existing assets are capitalized. Property and equipment are depreciated when placed into service using the straight-line method based on their estimated useful lives as follows: Asset Category Estimated Useful Life Computers and office equipment 3-5 years Laboratory equipment 5 years Furniture and fixtures 7 years Manufacturing equipment 5-13 years Leasehold improvements Lesser of remaining lease term and estimated useful life Costs for capital assets not yet placed into service have been capitalized as construction-in-progress, and will be depreciated in accordance with the above guidelines once placed into service. Upon retirement or sale, the cost of assets disposed and the related accumulated depreciation are removed from the accounts and any resulting gain or loss is recorded in the statements of operations. |
Intangible Assets | Intangible Assets The Company records the fair value of finite-lived intangible assets as of the transaction date. Intangible assets are then amortized over their estimated useful lives using either the straight-line method, or if reliably determinable, based on the pattern in which the economic benefit of the asset is expected to be utilized. The Company tests intangible assets for potential impairment whenever triggering events or circumstances present an indication of impairment. If the sum of expected undiscounted future cash flows of the intangible assets is less than the carrying amount of such assets, the intangible assets would be written down to the estimated fair value, calculated based on the present value of expected future cash flows. |
Leases | Leases In accordance with ASC Topic 842, Lease Accounting, Variable lease costs are not included in the measurement of the operating lease liability and are recognized in the period in which they are incurred. |
Revenue Recognition | Revenue Recognition The Company’s revenue to date is from sales of the Company’s products, which are primarily sold to distributors, which in turn sell the product to pharmacies for the treatment of patients. In accordance with ASC Topic 606, Revenue from Contracts with Customers Refer to Note 3 Revenue from Contracts with Customers |
Research and Development Costs | Research and Development Costs Research and development costs are charged to expense as incurred and consist of costs incurred to further the Company’s research and development activities. These costs include compensation and employee related costs, including stock based compensation; costs associated with conducting our clinical and non-clinical activities, including clinical and non-clinical trials that the Company conducts for post-marketing requirements; and costs for laboratory supplies, depreciation of lab equipment, and other expenses including allocated expenses for rent and maintenance of facilities. |
Patent Costs | Patent Costs Costs related to filing and pursuing patent applications are recorded as selling, general and administrative expense as incurred since the recoverability of such expenditures is uncertain. |
Advertising and Product Promotion Costs | Advertising and Product Promotion Costs Advertising and product promotion costs are included in selling, general and administrative expenses and were $4,186, $5,368 and $9,527 in the years ended December 31, 2021, 2020, and 2019 respectively. Advertising and product promotion costs are expensed as incurred. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for grants of stock options, restricted stock units and performance share units to employees, as well as to the Board of Directors, based on the grant date fair value and recognizes compensation expense over the vesting period, net of actual forfeitures. For employee awards with service conditions, the Company recognizes compensation expense on a straight-line basis. The Company estimates the grant date fair value of stock options using the Black-Scholes option pricing model. The Company estimates the grant date fair value of restricted stock units based on the fair value of the underlying common stock. For awards with performance conditions, the Company estimates the number of shares that will vest based upon the probability of achieving performance metrics. For employee awards with market conditions, the Company recognizes compensation expense on an accelerated attribution basis. The Company estimates the grant date fair value of awards with market conditions using the Monte Carlo model. |
Restructuring | Restructuring During the three months ended December 31, 2021, the Company executed a plan to reduce its workforce, primarily related to its salesforce. The arrangements included the payment of a cash severance benefit near the time of separation, together with continued medical benefits and related services. As a result, the Company recognized $4,578 in restructuring expense. Of this amount, $1,335 was paid by December 31, 2021 and $2,980 was paid in January 2022, with the remaining $263 will be paid in the first half of 2022. |
Income Taxes | Income Taxes The Company accounts for income taxes under the liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements. Under this method, deferred tax assets and liabilities are determined on the basis of the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the years in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The Company recognizes net deferred tax assets to the extent that the Company believes these assets are more likely than not to be realized. In making such a determination, management considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies and the absence of carryback available from results of recent operations. The Company records uncertain tax positions on the basis of a two-step process whereby (i) management determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (ii) for those tax positions that meet the more likely than not recognition threshold, management recognizes the largest amount of tax benefit that is more than 50% likely to be realized upon ultimate settlement with the related tax authority. The Company will recognize interest and penalties related to uncertain tax positions within income tax expense. Any accrued interest and penalties will be included within the related tax liability. As of December 31, 2021, the Company had no accrued interest or penalties related to uncertain tax positions and no amounts have been recognized in the Company’s statements of operations. |
Earnings per Share | Earnings per Share Basic earnings per share is calculated by dividing the net income (loss) attributable to common shareholders by the weighted-average number of shares of common stock outstanding during the period, without consideration for potentially dilutive securities. Diluted earnings per share is computed by dividing the net income (loss) attributable to common shareholders by the weighted-average number of shares of common stock, plus potentially dilutive securities outstanding for the period, as determined in accordance with the treasury stock, if-converted, or contingently issuable accounting methods, depending on the nature of the security. For purposes of the diluted earnings per share calculation, stock options, restricted stock units, performance share units, and shares potentially issuable in connection with our employee stock purchase plan and Convertible Notes are considered potentially dilutive securities and included to the extent that their addition is not anti-dilutive. |
Embedded Derivatives | Embedded Derivatives The Company accounts for derivative financial instruments as either equity or liabilities in accordance with Accounting Standards Codification Topic 815, Derivatives and Hedging refer to Note Debt |
Recently Accounting Pronouncements | Recently Adopted Accounting Pronouncements New accounting pronouncements are issued periodically by the Financial Accounting Standards Board (“FASB”) and are adopted by the Company as required by the specified effective dates. In December 2019, the FASB issued Accounting Standards Update (“ASU”) 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848) Facilitation of the Effects of Reference Rate Reform on Financial Reporting Reference Rate Reform (Topic 848): Scope, In August 2020, the FASB issued ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity's Own Equity The Company elected to early adopt this guidance on January 1, 2021 using the modified retrospective method. Under this transition method, the cumulative effect of the accounting change was removing the impact of recognizing the equity component of the Company’s convertible notes (at issuance and the subsequent accounting impact of additional interest expense from debt discount amortization). The cumulative effect of the accounting change as of January 1, 2021 was an increase to the carrying amount of the convertible notes of $39,489, a reduction to accumulated deficit of $5,288, and a reduction to additional paid-in capital of $44,777. Interest expense of the convertible senior notes will be lower as a result of adoption of this guidance and diluted net loss per share will be computed using the if-converted method for the convertible senior notes. As a result of the adoption of this guidance, interest expense decreased and net income In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options. Recently Issued Accounting Pronouncements Not Yet Adopted Other recent accounting pronouncements issued, but not yet effective, are not expected to be applicable to the Company or have a material effect on the consolidated financial statements upon future adoption. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of financial instruments measured at fair value by level within fair value hierarchy | Significant Quoted Prices other Significant in active observable unobservable markets inputs inputs Total (Level 1) (Level 2) (Level 3) December 31, 2021 Money market funds, included in cash equivalents $ 45,078 $ 45,078 $ — $ — December 31, 2020 Money market funds, included in cash equivalents $ 45,069 $ 45,069 $ — $ — |
Schedule of estimated useful lives of property and equipment | Asset Category Estimated Useful Life Computers and office equipment 3-5 years Laboratory equipment 5 years Furniture and fixtures 7 years Manufacturing equipment 5-13 years Leasehold improvements Lesser of remaining lease term and estimated useful life |
REVENUE FROM CONTRACTS WITH C_2
REVENUE FROM CONTRACTS WITH CUSTOMERS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
REVENUE FROM CONTRACTS WITH CUSTOMERS | |
Summary of product revenue provision and allowance | Trade Rebates and Product Allowances and Incentives (1) Returns (2) Chargebacks (3) Balance at December 31, 2018 $ 129,318 $ 15,465 $ 14,841 Provision related to current period sales 263,315 14,991 65,155 Changes in estimate related to prior period sales (2,865) — — Credits/payments made (259,867) (2,808) (65,976) Balance at December 31, 2019 $ 129,901 $ 27,648 $ 14,020 Provision related to current period sales 326,280 10,900 75,554 Changes in estimate related to prior period sales (539) — (403) Credits/payments made (322,867) (14,769) (70,116) Balance at December 31, 2020 $ 132,775 $ 23,779 $ 19,055 Provision related to current period sales 378,694 27,229 84,470 Changes in estimate related to prior period sales 1,121 8,763 4 Credits/payments made (370,211) (5,154) (90,303) Balance at December 31, 2021 $ 142,379 $ 54,617 $ 13,226 (1) Provisions for rebates and incentives includes managed care rebates, government rebates and co-pay program incentives. Provisions for rebates and incentives are deducted from gross revenues at the time revenues are recognized and are included in accrued rebates, returns and discounts in the Company’s Consolidated Balance Sheets. (2) Provisions for product returns are deducted from gross revenues at the time revenues are recognized and are included in accrued rebates, returns and discounts in the Company’s Consolidated Balance Sheets. (3) Provisions for trade allowances and chargebacks include fees for distribution service fees, prompt pay discounts, and chargebacks. Trade allowances and chargebacks are deducted from gross revenue at the time revenues are recognized and are recorded as a reduction to accounts receivable in the Company’s Consolidated Balance Sheets. |
Schedule of disaggregation of revenue | Years ended December 31, 2021 2020 2019 Xtampza ER $ 103,708 127,984 $ 105,012 Nucynta Products (1) 173,160 182,032 191,689 Total product revenues, net $ 276,868 $ 310,016 $ 296,701 (1) For the year ended December 31, 2021, the Company recognized Nucynta IR and Nucynta ER product revenues, net of $102,222 and $70,938 respectively. For the year ended December 31, 2020, the Company recognized Nucynta IR and Nucynta ER product revenues, net of $116,318 and $65,714, respectively. For the year ended December 31, 2019, the Company recognized Nucynta IR and Nucynta ER product revenues, net of $117,680 and $74,009, respectively. |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
EARNINGS PER SHARE | |
Schedule of computations of basic and diluted net (loss) per share | Years ended December 31, 2021 2020 2019 Numerator: Net income (loss) $ 71,517 $ 26,752 $ (22,722) Adjustment for interest expense recognized on convertible senior notes: 4,675 — — Net income (loss) — diluted $ 76,192 $ 26,752 (22,722) Denominator: Weighted-average shares outstanding — basic 34,936,817 34,407,959 33,453,844 Effect of dilutive securities: Stock options 504,699 431,524 — Restricted stock units 461,471 271,542 — Performance share units 85,229 27,002 — Employee stock purchase plan 1,198 567 — Warrants 131,257 12,759 — Convertible senior notes 4,925,134 — — Weighted average shares outstanding — diluted 41,045,805 35,151,353 33,453,844 Earnings (loss) per share — basic $ 2.05 $ 0.78 $ (0.68) Earnings (loss) per share — diluted $ 1.86 $ 0.76 $ (0.68) |
Schedule of dilutive securities excluded from the calculation of diluted earnings per share | Years ended December 31, 2021 2020 2019 Stock options 1,202,403 2,294,961 3,955,887 Restricted stock units 22,605 4,809 849,679 Performance share units 242,714 211,618 99,400 Employee stock purchase plan — — — Warrants — — 1,041,667 Convertible senior notes — 4,925,134 — |
INVENTORY (Tables)
INVENTORY (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
INVENTORY | |
Schedule of Inventory | As of December 31, 2021 2020 Raw materials $ 3,685 $ 3,514 Work in process 1,007 1,096 Finished goods 12,702 11,004 Total inventory $ 17,394 $ 15,614 |
PREPAID EXPENSES AND OTHER CU_2
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | |
Schedule of components of prepaid expenses and other current assets | As of December 31, 2021 2020 Prepaid regulatory fees $ 3,602 $ 3,280 Prepaid insurance 864 656 Other current assets 27 60 Prepaid development costs — 392 Other prepaid expenses 1,386 450 Prepaid expenses and other current assets $ 5,879 $ 4,838 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
PROPERTY AND EQUIPMENT | |
Schedule of components of property and equipment | As of December 31, 2021 2020 Computers and office equipment $ 1,547 $ 1,429 Laboratory equipment 1,340 1,299 Furniture and fixtures 1,079 1,073 Manufacturing equipment 14,498 14,119 Leasehold improvements 541 541 Construction-in-process 5,182 3,583 Total property and equipment 24,187 22,044 Less: accumulated deprecation (4,696) (3,056) Property and equipment, net $ 19,491 $ 18,988 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
INTANGIBLE ASSETS | |
Schedule of gross carrying amount and accumulated amortization of the Nucynta Intangible Asset | As of December 31, 2021 2020 Gross carrying amount $ 521,170 $ 521,170 Accumulated amortization (252,447) (185,266) Intangible asset, net $ 268,723 $ 335,904 |
Summary of costs included in acquired asset | Acquisition consideration: Base purchase price $ 375,000 Cash paid for inventory 6,030 Transaction costs 6,297 Reduction for 2020 cash transferred to Assertio under the prior Nucynta Commercialization Agreement (1) (13,071) Reduction for accrued royalty obligation discharged upon closing (1) (1,145) Total acquisition consideration: $ 373,111 (1) Represents $14,216 total reduction to the base purchase price comprising of $13,071 of cash payments transferred to Assertio under the prior Nucynta Commercialization Agreement as well as a reduction for $1,145 of discharged pre-acquisition accrued royalties based on sales from January 1, 2020 through closing. The Company then allocated the consideration transferred to the individual assets acquired on a relative fair value basis as summarized in the table below: Assets acquired: Nucynta Intangible Asset $ 367,081 Inventory 6,030 Total consideration allocated to assets acquired: $ 373,111 |
Summary of the gross carrying amount, accumulated amortization, and net book value | Gross Carrying Value Accumulated Amortization Net Book Value Balance as of December 31, 2018 $ 154,089 $ (109,834) $ 44,255 Amortization expense — (14,752) (14,752) Balance as of December 31, 2019 $ 154,089 $ (124,586) $ 29,503 Amortization expense through Nucynta Acquisition — (1,754) (1,754) Additional cost incurred from Nucynta Acquisition 367,081 — 367,081 Amortization expense from Nucynta Acquisition through period end — (58,926) (58,926) Balance as of December 31, 2020 $ 521,170 $ (185,266) $ 335,904 Amortization expense through period end — (67,181) (67,181) Balance as of December 31, 2021 $ 521,170 $ (252,447) $ 268,723 |
Summary of amortization expense | Years ended December 31, 2021 2020 2019 Nucynta amortization expense included in cost of product revenues $ 67,181 $ 60,680 $ 14,752 |
Schedule of future amortization expenses | Years ended December 31, Amortization Expense 2022 $ 67,181 2023 67,181 2024 67,181 2025 67,180 Remaining amortization expense: $ 268,723 |
ACCRUED EXPENSES (Tables)
ACCRUED EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
ACCRUED EXPENSES | |
Schedule of components of accrued expenses | As of December 31, 2021 2020 Accrued royalties $ 9,930 $ 12,954 Accrued audit and legal 3,623 445 Accrued restructuring expenses 3,222 — Accrued bonuses 2,634 4,571 Accrued product taxes and fees 2,570 1,817 Accrued interest 1,415 1,415 Accrued incentive compensation 851 1,417 Accrued payroll and related benefits 807 892 Accrued sales and marketing 697 261 Accrued income taxes 622 — Accrued other operating costs 2,843 884 Total accrued expenses $ 29,214 $ 24,656 |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Debt Instrument [Line Items] | |
Summary of convertible notes outstanding | Principal $ 143,750 Less: unamortized issuance costs (3,784) Net carrying amount $ 139,966 |
Schedule of total interest expense recognized related to the convertible notes | Years ended December 31, 2021 2020 Contractual interest expense $ 3,773 $ 3,323 Amortization of debt discount — 5,628 Amortization of debt issuance costs 902 447 Total interest expense $ 4,675 $ 9,398 |
Convertible senior notes | |
Debt Instrument [Line Items] | |
Schedule of principal repayments of debt | Years ended December 31, Future Minimum Payments 2022 $ 3,773 2023 3,773 2024 3,773 2025 3,773 2026 145,638 Total minimum payments $ 160,730 Less: interest (16,980) Less: unamortized issuance costs (3,784) Convertible senior notes $ 139,966 |
Pharmakon Term Notes | |
Debt Instrument [Line Items] | |
Schedule of principal repayments of debt | Years ended December 31, Principal Payments 2022 $ 50,000 2023 50,000 2024 12,500 Total before unamortized discount and issuance costs $ 112,500 Less: unamortized discount and issuance costs (2,481) Total term notes $ 110,019 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
LEASES | |
Schedule of lease cost | Years ended December 31, 2021 2020 2019 Lease Cost Operating lease cost $ 1,305 $ 1,305 $ 1,446 Short-term lease cost 1,492 1,312 752 Variable lease cost 292 331 283 Total lease cost $ 3,089 $ 2,948 $ 2,481 |
Schedule of lease term and discount rate | As of December 31, Lease Term and Discount Rate: 2021 2020 Weighted-average remaining lease term — operating leases (years) 7.6 8.6 Weighted-average discount rate — operating leases 6.1% 6.1% |
Schedule of other information | Years ended December 31, Other Information: 2021 2020 2019 Cash paid for amounts included in the measurement of operating leases liabilities $ 1,286 $ 1,249 $ 1,133 Leased assets obtained in exchange for new operating lease liabilities — — — |
Schedule of future minimum lease payments | 2022 $ 1,325 2023 1,363 2024 1,401 2025 1,439 2026 1,477 After 2026 4,060 Total minimum lease payments $ 11,065 Less: Present value discount 2,300 Present value of lease liabilities $ 8,765 |
STOCK - BASED COMPENSATION (Tab
STOCK - BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
STOCK - BASED COMPENSATION | |
Summary of performance share units activity | Weighted-Average Shares Grant Date Fair Value Outstanding at December 31, 2020 283,223 $ 24.26 Granted 231,180 35.15 Vested (66,974) 22.35 Forfeited (81,720) 30.66 Performance adjustment (12,609) 21.80 Outstanding at December 31, 2021 353,100 $ 31.77 |
Summary of restricted stock units activity | Weighted-Average Shares Grant Date Fair Value Outstanding at December 31, 2020 1,242,387 $ 19.42 Granted 1,373,031 24.23 Vested (444,769) 19.17 Forfeited (550,626) 22.63 Outstanding at December 31, 2021 1,620,023 $ 22.48 |
Summary of stock option activity | Weighted- Weighted- Average Average Remaining Aggregate Exercise Price Contractual Intrinsic Shares per Share Term (in years) Value Outstanding at December 31, 2020 3,860,481 $ 17.78 7.2 $ 13,011 Granted 90,000 21.03 Exercised (803,485) 14.78 Cancelled (418,827) 20.65 Outstanding at December 31, 2021 2,728,169 $ 18.33 5.8 $ 6,070 Exercisable at December 31, 2021 2,220,889 $ 18.26 5.3 $ 5,262 |
Schedule of fair value assumption using Black-Scholes option-pricing model | Year ended December 31, 2021 2020 2019 Risk-free interest rate 0.7 % 1.3 % 2.4 % Volatility 67.2 % 66.2 % 63.3 % Expected term (years) 6.0 6.0 6.1 Expected dividend yield — % — % — % |
Summary of stock-based compensation | Years ended December 31, 2021 2020 2019 Research and development $ 3,422 3,909 $ 2,126 Selling, general and administrative 20,833 18,001 14,402 Total stock-based compensation expense $ 24,255 $ 21,910 $ 16,528 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
INCOME TAXES | |
Schedule of income tax expense recognized | Year Ended December 31, 2021 2020 2019 Current provision (benefit): Federal $ — $ — $ — State 3,142 830 — 3,142 830 — Deferred provision (benefit): Federal $ (61,445) $ — $ — State (16,588) — — (78,033) — — Income tax provision (benefit) $ (74,891) $ 830 $ — |
Schedule of reconciliation of income tax expense (benefit) at statutory federal income tax rate to income taxes | As of December 31, 2021 2020 2019 Federal income tax expense at statutory rate 21.0 % 21.0 % 21.0 % (Increase) decrease income tax (benefit) resulting from: State income tax, net of federal benefit 2.9 5.1 5.6 Permanent differences (3.9) 1.1 (1.4) Stock compensation (18.8) (3.0) (1.8) Research and development credit 16.3 (1.1) 1.8 Change in valuation allowance 2,202.5 (20.1) (25.2) Effective income tax rate 2,220.0 % 3.0 % — % |
Schedule of significant components of deferred tax assets and liabilities | As of December 31, 2021 2020 Deferred tax assets: U.S. and state net operating loss carryforwards $ 31,400 $ 57,457 Research and development credits 5,470 5,004 Operating lease liabilities 2,321 2,508 Returns and discounts 23,072 6,281 Stock-based compensation 7,838 7,133 Accruals and other 2,210 1,892 Intangible assets 12,699 1,297 Gross deferred tax assets: 85,010 81,572 Valuation allowance (1,966) (65,661) Total deferred tax assets: 83,044 15,911 Deferred tax liabilities: Debt discount — (10,809) Operating lease assets (2,024) (2,217) Depreciation (2,978) (2,885) Net deferred tax assets $ 78,042 $ — |
Schedule of reconciliation of gross unrecognized tax benefits | As of December 31, 2021 2020 2019 Gross UTB Balance at January 1 $ 586 $ 578 $ 502 Additions based on tax positions related to the current year 67 36 76 Additions for tax positions of prior years 1 — — Reductions for tax positions of prior years — (28) — Gross UTB Balance at December 31 $ 654 $ 586 $ 578 Net UTB impacting the effective tax rate at December 31 excluding valuation allowance impacts, if any $ 500 $ 560 $ 549 |
UNAUDITED QUARTERLY OPERATING_2
UNAUDITED QUARTERLY OPERATING RESULTS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
UNAUDITED QUARTERLY OPERATING RESULTS | |
Summary of unaudited quarterly results of operations | First Second Third Fourth Year ended December 31, 2021 Quarter Quarter Quarter Quarter (1) Product revenues, net $ 87,721 $ 82,942 $ 78,843 $ 27,362 Cost of product revenues Cost of product revenues (excluding intangible asset amortization) 15,328 15,908 15,934 11,900 Intangible asset amortization 16,795 16,795 16,796 16,795 Total cost of products revenues 32,123 32,703 32,730 28,695 Gross profit 55,598 50,239 46,113 (1,333) Operating expenses Research and development 2,930 3,462 1,450 1,609 Selling, general and administrative 31,476 30,368 30,514 26,602 Restructuring — — — 4,578 Total operating expenses 34,406 33,830 31,964 32,789 Income (loss) from operations 21,192 16,409 14,149 (34,122) Interest expense (5,721) (5,421) (5,115) (4,757) Interest income 3 3 3 3 Income (loss) before income taxes 15,474 10,991 9,037 (38,876) (Benefit from) provision for income taxes (188) (61,852) 991 (13,842) Net income (loss) $ 15,662 $ 72,843 $ 8,046 $ (25,034) Earnings (loss) per share — basic $ 0.45 $ 2.06 $ 0.23 $ (0.73) Weighted-average shares — basic 34,951,740 35,302,608 35,373,909 34,123,309 Earnings (loss) per share — diluted $ 0.41 $ 1.79 $ 0.22 $ (0.73) Weighted-average shares — diluted 41,160,092 41,286,853 36,261,174 34,123,309 First Second Third Fourth Year ended December 31, 2020 Quarter Quarter Quarter Quarter Product revenues, net $ 76,511 $ 78,058 $ 79,176 $ 76,271 Cost of product revenues Cost of product revenues (excluding intangible asset amortization) 27,229 12,899 14,188 15,184 Intangible asset amortization 10,295 16,795 16,795 16,795 Total cost of products revenues 37,524 29,694 30,983 31,979 Gross profit 38,987 48,364 48,193 44,292 Operating expenses Research and development 2,666 2,493 2,141 2,472 Selling, general and administrative 31,260 29,322 26,426 26,824 Total operating expenses 33,926 31,815 28,567 29,296 Income from operations 5,061 16,549 19,626 14,996 Interest expense (4,823) (8,259) (8,063) (7,737) Interest income 212 14 3 3 Income before income taxes 450 8,304 11,566 7,262 Provision for income taxes — 246 280 304 Net income $ 450 $ 8,058 $ 11,286 $ 6,958 Earnings per share — basic $ 0.01 $ 0.23 $ 0.33 $ 0.20 Weighted-average shares — basic 34,100,688 34,395,266 34,540,126 34,592,277 Earnings per share — diluted $ 0.01 $ 0.23 $ 0.32 $ 0.20 Weighted-average shares — diluted 35,069,693 35,091,906 35,069,188 35,417,623 (1) In the fourth quarter of 2021, product revenues, net included a $38,329 product revenue adjustment related to returns adjustments, of which $13,787 related to Xtampza revenue and $24,542 related to Nucynta Products revenue. In addition, selling general and administrative operating expense includes $2,935 of expense related to litigation settlements . |
NATURE OF BUSINESS (Details)
NATURE OF BUSINESS (Details) - USD ($) $ in Thousands | Feb. 13, 2020 | Feb. 06, 2020 | Feb. 29, 2020 | Dec. 31, 2021 | Dec. 31, 2020 |
Accumulated deficit | $ (256,342) | $ (333,147) | |||
Assertio | Nucynta Purchase Agreement | Nucynta Products | |||||
Aggregate purchase price | $ 375,000 | $ 375,000 | |||
Grnenthal | Nucynta Purchase Agreement | Nucynta Products | |||||
Royalty payment as percentage of annual net sales | 14.00% |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jan. 31, 2022USD ($) | Dec. 31, 2021USD ($)claim | Jun. 30, 2022USD ($) | Dec. 31, 2021USD ($)customerclaimInstitution | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Number of reputable and nationally recognized financial institution | Institution | 1 | |||||
Financial instruments with off balance sheet risk of loss, assets | $ 0 | $ 0 | ||||
Financial instruments with off balance sheet risk of loss, liabilities | 0 | 0 | ||||
Restricted cash | 2,547 | 2,547 | $ 2,547 | |||
Inventory | 17,394 | 17,394 | 15,614 | |||
Accrued interest or penalties related to uncertain tax positions | 0 | 0 | 0 | |||
Accrued interest or penalties recognized related to uncertain tax positions | 0 | 0 | ||||
Restructuring expenses | 4,578 | $ 4,578 | ||||
Payments on restructuring expense | $ 2,980 | $ 1,335 | ||||
Number of pending claims | claim | 27 | 27 | ||||
Litigation costs incurred | $ 2,750 | $ 2,750 | ||||
Forecast | ||||||
Payments on restructuring expense | $ 263 | |||||
Selling, general and administrative expenses | ||||||
Advertising and product promotion costs | $ 4,186 | $ 5,368 | $ 9,527 | |||
Accounts Receivable | Customer Concentration Risk | ||||||
Number of customers | customer | 3 | |||||
Accounts Receivable | Customer Concentration Risk | Customer One | ||||||
Concentration Risk, Percentage | 46.00% | 46.00% | 51.00% | |||
Accounts Receivable | Customer Concentration Risk | Customer Two | ||||||
Concentration Risk, Percentage | 33.00% | 34.00% | 27.00% | |||
Accounts Receivable | Customer Concentration Risk | Customer Three | ||||||
Concentration Risk, Percentage | 20.00% | 17.00% | 19.00% | |||
Revenue | Customer Concentration Risk | ||||||
Number of customers | customer | 3 | |||||
Revenue | Customer Concentration Risk | Customer One | ||||||
Concentration Risk, Percentage | 35.00% | 34.00% | 34.00% | |||
Revenue | Customer Concentration Risk | Customer Two | ||||||
Concentration Risk, Percentage | 31.00% | 31.00% | 31.00% | |||
Revenue | Customer Concentration Risk | Customer Three | ||||||
Concentration Risk, Percentage | 29.00% | 31.00% | 30.00% |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Fair Value Measurements (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Transfer of Assets From Level 1 to Level 2 | $ 0 | $ 0 |
Transfer of Assets From Level 2 to Level 1 | 0 | 0 |
Transfer of Liabilities From Level 1 to Level 2 | 0 | 0 |
Transfer of Liabilities From Level 2 to Level 1 | 0 | 0 |
Transfer of Assets Into Level 3 | 0 | 0 |
Transfer of Assets Out of Level 3 | 0 | 0 |
Transfer of Liabilities Into Level 3 | 0 | 0 |
Transfer of Liabilities Out of Level 3 | 0 | 0 |
Convertible senior notes, fair value | 139,078 | |
Convertible senior notes, net carrying value | 139,966 | 99,575 |
Money market funds | Level 1 | Recurring | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Cash equivalents | 45,078 | 45,069 |
Money market funds | Significant other observable inputs (Level 2) | Recurring | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Cash equivalents | $ 45,078 | $ 45,069 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Property, Plant and Equipment Useful Lives (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Computers and office equipment | Minimum | |
Property and Equipment | |
Estimated Useful Life | 3 years |
Computers and office equipment | Maximum | |
Property and Equipment | |
Estimated Useful Life | 5 years |
Laboratory equipment | |
Property and Equipment | |
Estimated Useful Life | 5 years |
Furniture and fixtures | |
Property and Equipment | |
Estimated Useful Life | 7 years |
Manufacturing Equipment | Minimum | |
Property and Equipment | |
Estimated Useful Life | 5 years |
Manufacturing Equipment | Maximum | |
Property and Equipment | |
Estimated Useful Life | 13 years |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Recently Adopted Accounting Pronouncements (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Convertible senior notes, net carrying value | $ 139,966 | $ 99,575 | $ 139,966 | $ 99,575 | |||||||
Accumulated deficit | (256,342) | (333,147) | (256,342) | (333,147) | |||||||
Additional paid-in capital | 502,095 | 519,143 | 502,095 | 519,143 | |||||||
Net income (loss) | (25,034) | $ 8,046 | $ 72,843 | $ 15,662 | 6,958 | $ 11,286 | $ 8,058 | $ 450 | 71,517 | 26,752 | $ (22,722) |
Interest expense | $ 4,757 | $ 5,115 | $ 5,421 | $ 5,721 | $ 7,737 | $ 8,063 | $ 8,259 | $ 4,823 | $ 21,014 | $ 28,882 | $ 909 |
Earnings (loss) per share - basic (in dollars per share) | $ (0.73) | $ 0.23 | $ 2.06 | $ 0.45 | $ 0.20 | $ 0.33 | $ 0.23 | $ 0.01 | $ 2.05 | $ 0.78 | $ (0.68) |
Earnings (loss) per share - diluted (in dollars per share) | $ (0.73) | $ 0.22 | $ 1.79 | $ 0.41 | $ 0.20 | $ 0.32 | $ 0.23 | $ 0.01 | $ 1.86 | $ 0.76 | $ (0.68) |
Adjustment. | Accounting Standards Update 2020-06 | |||||||||||
Convertible senior notes, net carrying value | $ 39,489 | $ 39,489 | $ 39,489 | $ 39,489 | |||||||
Accumulated deficit | 5,288 | (5,288) | 5,288 | (5,288) | |||||||
Additional paid-in capital | 44,777 | $ (44,777) | 44,777 | $ (44,777) | |||||||
Net income (loss) | $ 1,685 | ||||||||||
Interest expense | $ (6,488) | ||||||||||
Earnings (loss) per share - basic (in dollars per share) | $ 0.19 | ||||||||||
Earnings (loss) per share - diluted (in dollars per share) | $ (0.06) |
REVENUE FROM CONTRACTS WITH C_3
REVENUE FROM CONTRACTS WITH CUSTOMERS - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Practical expedient incremental cost | true | ||||||||||
Returns policy, threshold product return period | 18 months | ||||||||||
Returns policy, threshold product return period prior to expiration | 6 months | ||||||||||
Returns policy, threshold product return period after expiration | 12 months | ||||||||||
Maximum percentage of value of actual returned product to product returns claimed | 20.00% | ||||||||||
Product revenues, net | $ 27,362 | $ 78,843 | $ 82,942 | $ 87,721 | $ 76,271 | $ 79,176 | $ 78,058 | $ 76,511 | $ 276,868 | $ 310,016 | $ 296,701 |
Estimates of product returned | Adjustment | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Product revenues, net | (38,329) | ||||||||||
Performance obligations satisfied in the prior year | (26,644) | ||||||||||
Refund liability | $ 8,763 | $ 8,763 | |||||||||
Minimum | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Term of payment received | 30 days | ||||||||||
Maximum | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Term of payment received | 90 days |
REVENUE FROM CONTRACTS WITH C_4
REVENUE FROM CONTRACTS WITH CUSTOMERS - Transaction Price and Variable Consideration (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Rebates and Incentives | |||
Allowance categories | |||
Balance at beginning of the period | $ 132,775 | $ 129,901 | $ 129,318 |
Provision related to current period sales | 378,694 | 326,280 | 263,315 |
Changes in estimate related to prior period sales | 1,121 | (539) | (2,865) |
Credits/payments made | (370,211) | (322,867) | (259,867) |
Balance at end of the period | 142,379 | 132,775 | 129,901 |
Product Returns | |||
Allowance categories | |||
Balance at beginning of the period | 23,779 | 27,648 | 15,465 |
Provision related to current period sales | 27,229 | 10,900 | 14,991 |
Changes in estimate related to prior period sales | 8,763 | ||
Credits/payments made | (5,154) | (14,769) | (2,808) |
Balance at end of the period | 54,617 | 23,779 | 27,648 |
Trade Allowances and Chargebacks | |||
Allowance categories | |||
Balance at beginning of the period | 19,055 | 14,020 | 14,841 |
Provision related to current period sales | 84,470 | 75,554 | 65,155 |
Changes in estimate related to prior period sales | 4 | (403) | |
Credits/payments made | (90,303) | (70,116) | (65,976) |
Balance at end of the period | $ 13,226 | $ 19,055 | $ 14,020 |
REVENUE FROM CONTRACTS WITH C_5
REVENUE FROM CONTRACTS WITH CUSTOMERS - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Disaggregation of Revenue | |||||||||||
Product revenues, net | $ 27,362 | $ 78,843 | $ 82,942 | $ 87,721 | $ 76,271 | $ 79,176 | $ 78,058 | $ 76,511 | $ 276,868 | $ 310,016 | $ 296,701 |
Xtampza ER | |||||||||||
Disaggregation of Revenue | |||||||||||
Product revenues, net | 103,708 | 127,984 | 105,012 | ||||||||
Nucynta Products | |||||||||||
Disaggregation of Revenue | |||||||||||
Product revenues, net | 173,160 | 182,032 | 191,689 | ||||||||
Nucynta IR | |||||||||||
Disaggregation of Revenue | |||||||||||
Product revenues, net | 102,222 | 116,318 | 117,680 | ||||||||
Nucynta ER | |||||||||||
Disaggregation of Revenue | |||||||||||
Product revenues, net | $ 70,938 | $ 65,714 | $ 74,009 |
EARNINGS PER SHARE - Computatio
EARNINGS PER SHARE - Computation of Net Earnings (Loss) per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
EARNINGS PER SHARE | |||||||||||
Net income (loss) | $ (25,034) | $ 8,046 | $ 72,843 | $ 15,662 | $ 6,958 | $ 11,286 | $ 8,058 | $ 450 | $ 71,517 | $ 26,752 | $ (22,722) |
Adjustment for interest expense recognized on convertible senior notes: | 4,675 | ||||||||||
Net income (loss) - diluted | $ 76,192 | $ 26,752 | $ (22,722) | ||||||||
Weighted-average shares outstanding - basic | 34,123,309 | 35,373,909 | 35,302,608 | 34,951,740 | 34,592,277 | 34,540,126 | 34,395,266 | 34,100,688 | 34,936,817 | 34,407,959 | 33,453,844 |
Weighted-average shares outstanding - diluted (in shares) | 34,123,309 | 36,261,174 | 41,286,853 | 41,160,092 | 35,417,623 | 35,069,188 | 35,091,906 | 35,069,693 | 41,045,805 | 35,151,353 | 33,453,844 |
Earnings (loss) per share - basic (in dollars per share) | $ (0.73) | $ 0.23 | $ 2.06 | $ 0.45 | $ 0.20 | $ 0.33 | $ 0.23 | $ 0.01 | $ 2.05 | $ 0.78 | $ (0.68) |
Earnings (loss) per share - diluted (in dollars per share) | $ (0.73) | $ 0.22 | $ 1.79 | $ 0.41 | $ 0.20 | $ 0.32 | $ 0.23 | $ 0.01 | $ 1.86 | $ 0.76 | $ (0.68) |
Stock options | |||||||||||
EARNINGS PER SHARE | |||||||||||
Effect of dilutive securities: | 504,699 | 431,524 | |||||||||
Restricted stock units | |||||||||||
EARNINGS PER SHARE | |||||||||||
Effect of dilutive securities: | 461,471 | 271,542 | |||||||||
Performance share units | |||||||||||
EARNINGS PER SHARE | |||||||||||
Effect of dilutive securities: | 85,229 | 27,002 | |||||||||
Employee stock purchase program | |||||||||||
EARNINGS PER SHARE | |||||||||||
Effect of dilutive securities: | 1,198 | 567 | |||||||||
Warrants | |||||||||||
EARNINGS PER SHARE | |||||||||||
Effect of dilutive securities: | 131,257 | 12,759 | |||||||||
Convertible senior notes | |||||||||||
EARNINGS PER SHARE | |||||||||||
Effect of dilutive securities: | 4,925,134 |
EARNINGS PER SHARE - Anti-dilut
EARNINGS PER SHARE - Anti-dilutive Securities (Details) - shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Stock options | |||
Anti-dilutive securities | |||
Dilutive securities excluded from the calculation of diluted earnings per share (in shares) | 1,202,403 | 2,294,961 | 3,955,887 |
Restricted stock units | |||
Anti-dilutive securities | |||
Dilutive securities excluded from the calculation of diluted earnings per share (in shares) | 22,605 | 4,809 | 849,679 |
Performance share units | |||
Anti-dilutive securities | |||
Dilutive securities excluded from the calculation of diluted earnings per share (in shares) | 242,714 | 211,618 | 99,400 |
Warrants | |||
Anti-dilutive securities | |||
Dilutive securities excluded from the calculation of diluted earnings per share (in shares) | 1,041,667 | ||
Convertible senior notes | |||
Anti-dilutive securities | |||
Dilutive securities excluded from the calculation of diluted earnings per share (in shares) | 4,925,134 |
INVENTORY (Details)
INVENTORY (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
INVENTORY | ||
Raw materials | $ 3,685 | $ 3,514 |
Work in process | 1,007 | 1,096 |
Finished goods | 12,702 | 11,004 |
Total inventory | 17,394 | 15,614 |
Inventory used in the construction and installation of property and equipment | $ 516 | $ 2,299 |
PREPAID EXPENSES AND OTHER CU_3
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | ||
Prepaid regulatory fees | $ 3,602 | $ 3,280 |
Prepaid insurance | 864 | 656 |
Other current assets | 27 | 60 |
Prepaid development costs | 392 | |
Other prepaid expenses | 1,386 | 450 |
Prepaid expenses and other current assets | $ 5,879 | $ 4,838 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Property and Equipment | |||
Total property and equipment | $ 24,187 | $ 22,044 | |
Less: accumulated deprecation | (4,696) | (3,056) | |
Property and equipment, net | 19,491 | 18,988 | |
Depreciation expense | 1,736 | 870 | $ 731 |
Disposal of fully depreciated assets | 96 | 102 | $ 280 |
Computers and office equipment | |||
Property and Equipment | |||
Total property and equipment | 1,547 | 1,429 | |
Laboratory equipment | |||
Property and Equipment | |||
Total property and equipment | 1,340 | 1,299 | |
Furniture and fixtures | |||
Property and Equipment | |||
Total property and equipment | 1,079 | 1,073 | |
Manufacturing Equipment | |||
Property and Equipment | |||
Total property and equipment | 14,498 | 14,119 | |
Leasehold improvements | |||
Property and Equipment | |||
Total property and equipment | 541 | 541 | |
Construction-in-process | |||
Property and Equipment | |||
Total property and equipment | $ 5,182 | $ 3,583 |
INTANGIBLE ASSETS (Details)
INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Gross carrying amount | $ 521,170 | $ 521,170 | $ 154,089 | $ 154,089 |
Accumulated amortization | (252,447) | (185,266) | (124,586) | (109,834) |
Intangible asset, net | 268,723 | 335,904 | $ 29,503 | $ 44,255 |
Nucynta Products | ||||
Gross carrying amount | 521,170 | 521,170 | ||
Accumulated amortization | (252,447) | (185,266) | ||
Intangible asset, net | $ 268,723 | $ 335,904 |
INTANGIBLE ASSETS - Nucynta Acq
INTANGIBLE ASSETS - Nucynta Acquisitions (Details) - Nucynta Purchase Agreement - Nucynta Products - USD ($) $ in Thousands | Feb. 06, 2020 | Feb. 29, 2020 |
Acquisition consideration: | ||
Base purchase price | $ 375,000 | |
Cash paid for inventory | 6,030 | |
Transaction costs | 6,297 | |
Reduction for 2020 cash transferred to Assertio under the prior Nucynta Commercialization Agreement | (13,071) | |
Reduction for accrued royalty obligation discharged upon closing | (1,145) | |
Total acquisition consideration | 373,111 | |
Reduction to base purchase price | 14,216 | |
Consideration transferred to assets acquired: | ||
Nucynta Intangible Asset | 367,081 | |
Inventory | 6,030 | |
Total consideration allocated to assets acquired | 373,111 | |
Assertio | ||
Finite-Lived Intangible Assets [Line Items] | ||
Aggregate purchase price | $ 375,000 | $ 375,000 |
INTANGIBLE ASSETS - Nucynta Com
INTANGIBLE ASSETS - Nucynta Commercialization Agreement - Narrative (Details) - $ / shares | Feb. 13, 2020 | Nov. 30, 2018 |
Nucynta Commercialization Agreement | Grnenthal | Nucynta Products | ||
Finite-Lived Intangible Assets [Line Items] | ||
Royalty payment as percentage of annual net sales | 14.00% | |
Third Amendment to the Nucynta Commercialization Agreement | ||
Finite-Lived Intangible Assets [Line Items] | ||
Number of shares that can be purchased | 1,041,667 | |
Exercise price of warrant (in dollars per share) | $ 19.20 |
INTANGIBLE ASSETS - Nucynta C_2
INTANGIBLE ASSETS - Nucynta Commercialization Agreement - Table (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 11 Months Ended | 12 Months Ended | ||||||||||
Jan. 31, 2020 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Gross carrying amount | $ 521,170 | $ 521,170 | $ 521,170 | $ 521,170 | $ 521,170 | $ 154,089 | $ 154,089 | |||||||
Amortization expense | (16,795) | $ (16,796) | $ (16,795) | $ (16,795) | (16,795) | $ (16,795) | $ (16,795) | $ (10,295) | (67,181) | (60,680) | (14,752) | |||
Accumulated amortization | (252,447) | (185,266) | (185,266) | (252,447) | (185,266) | (124,586) | (109,834) | |||||||
Intangible asset, net | 268,723 | 335,904 | 335,904 | 268,723 | 335,904 | 29,503 | $ 44,255 | |||||||
Nucynta Products | ||||||||||||||
Gross carrying amount | 521,170 | 521,170 | 521,170 | 521,170 | 521,170 | |||||||||
Amortization expense | (67,181) | (60,680) | $ (14,752) | |||||||||||
Accumulated amortization | (252,447) | (185,266) | (185,266) | (252,447) | (185,266) | |||||||||
Intangible asset, net | $ 268,723 | 335,904 | 335,904 | $ 268,723 | 335,904 | |||||||||
Nucynta Commercialization Agreement | Nucynta Products | ||||||||||||||
Amortization expense | $ (1,754) | (58,926) | ||||||||||||
Additional costs incurred | $ 367,081 | $ 367,081 | $ 367,081 |
INTANGIBLE ASSETS - Amortizatio
INTANGIBLE ASSETS - Amortization (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Finite-Lived Intangible Assets [Line Items] | ||||||||||||
Intangible asset amortization | $ 16,795 | $ 16,796 | $ 16,795 | $ 16,795 | $ 16,795 | $ 16,795 | $ 16,795 | $ 10,295 | $ 67,181 | $ 60,680 | $ 14,752 | |
Remaining amortization period (in years) | 4 years | |||||||||||
2022 | 67,181 | $ 67,181 | ||||||||||
2023 | 67,181 | 67,181 | ||||||||||
2024 | 67,181 | 67,181 | ||||||||||
2025 | 67,180 | 67,180 | ||||||||||
Intangible asset, net | 268,723 | 335,904 | $ 268,723 | 335,904 | 29,503 | $ 44,255 | ||||||
Nucynta Products | ||||||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||||||
Useful life of intangible asset (in years) | 5 years 10 months 24 days | |||||||||||
Amortization expense recognized prior to third amendment | $ 126,340 | |||||||||||
Intangible asset amortization | 67,181 | 60,680 | $ 14,752 | |||||||||
Intangible asset, net | $ 268,723 | $ 335,904 | $ 268,723 | $ 335,904 |
ACCRUED EXPENSES (Details)
ACCRUED EXPENSES (Details) $ in Thousands | Dec. 31, 2021USD ($)claim | Dec. 31, 2020USD ($) |
ACCRUED EXPENSES | ||
Accrued royalties | $ 9,930 | $ 12,954 |
Accrued audit and legal | 3,623 | 445 |
Accrued restructuring expenses | 3,222 | |
Accrued bonuses | 2,634 | 4,571 |
Accrued product taxes and fees | 2,570 | 1,817 |
Accrued interest | 1,415 | 1,415 |
Accrued incentive compensation | 851 | 1,417 |
Accrued payroll and related benefits | 807 | 892 |
Accrued sales and marketing | 697 | 261 |
Accrued income taxes | 622 | |
Accrued other operating costs | 2,843 | 884 |
Total accrued expenses | 29,214 | $ 24,656 |
Litigation costs incurred | $ 2,750 | |
Number of pending claims | claim | 27 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Thousands | Dec. 24, 2021USD ($)case | Dec. 16, 2021USD ($) | Sep. 11, 2020 | Oct. 02, 2019 | Mar. 24, 2015patent | Feb. 11, 2015patent | Oct. 31, 2019case | Dec. 31, 2021lawsuitclaimcasestate | Apr. 30, 2017patentlawsuit |
Commitments and Contingencies | |||||||||
Number of pending claims | claim | 27 | ||||||||
Xtampza ER Litigation | |||||||||
Commitments and Contingencies | |||||||||
Number of patents listed in FDA Orange Book | patent | 11 | ||||||||
Stay period before FDA can issue a final approval unless it is terminated | 30 months | ||||||||
Number of patents allegedly infringed | patent | 5 | 2 | |||||||
Number of lawsuits filed | lawsuit | 2 | ||||||||
PTAB duration for issuing decision | 1 year | ||||||||
Statutory period of proceedings | 18 months | ||||||||
Xtampza ER Litigation | Maximum | |||||||||
Commitments and Contingencies | |||||||||
PTAB extended duration for issuing decision | 6 months | ||||||||
Xtampza ER Litigation, District of Delaware | |||||||||
Commitments and Contingencies | |||||||||
Stay period before FDA can issue a final approval unless it is terminated | 30 months | ||||||||
Number of patents allegedly infringed | patent | 3 | ||||||||
Xtampza ER Litigation, District of Massachusetts | |||||||||
Commitments and Contingencies | |||||||||
Stay period before FDA can issue a final approval unless it is terminated | 30 months | ||||||||
Number of patents allegedly infringed | patent | 3 | ||||||||
Opioid Litigation | |||||||||
Commitments and Contingencies | |||||||||
Number of lawsuits filed | lawsuit | 6 | ||||||||
Number of lawsuits dismissed | 13 | ||||||||
Number of lawsuits designated as representative cases | lawsuit | 0 | ||||||||
Number of lawsuits designated as Track One case | lawsuit | 0 | ||||||||
Loss Contingency, Claims Settled, Number | 27 | ||||||||
Opioid Litigation | Maximum | |||||||||
Commitments and Contingencies | |||||||||
Litigation settlement, amount awarded to other party | $ | $ 2,750,000 | ||||||||
Multi-District Litigation (MDL) | |||||||||
Commitments and Contingencies | |||||||||
Number of states filed cases | state | 3 | ||||||||
Total number of cases brought primarily by states, cities, counties, and other local entities | 2,000 | ||||||||
Number of lawsuits filed | 2 | 21 | |||||||
Number of lawsuits currently stayed | 8 | ||||||||
Number of lawsuits dismissed | 3 | ||||||||
Opioid-Related Request and Subpoenas | |||||||||
Commitments and Contingencies | |||||||||
Agreed to pay attorney general | $ | $ 185,000 | ||||||||
Reimbursement of investigation cost of the attorney general | $ | $ 65,000 |
DEBT- Pharmakon (Details)
DEBT- Pharmakon (Details) - Pharmakon Term Notes - USD ($) $ in Thousands | Feb. 06, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Debt | ||||
Aggregate principal amount | $ 200,000 | |||
Margin rate | 7.50% | |||
Debt maturity | 48 months | |||
Facility fee (as a percent) | 2.50% | |||
Facility fee amount | $ 5,000 | |||
Debt issuance costs | 427 | |||
Net proceeds | 194,573 | |||
Issuance cost capitalized | 2,456 | |||
Threshold amount of single voluntary prepayment from equity proceeds | 50,000 | |||
Threshold annual net sales to be maintained | $ 200,000 | |||
Interest expense | $ 16,339 | $ 19,034 | $ 0 | |
Principal repayments | ||||
2022 | 50,000 | |||
2023 | 50,000 | |||
2024 | 12,500 | |||
Total before unamortized discount and issuance costs | 112,500 | |||
Less: unamortized discount and issuance costs | (2,481) | |||
Total term notes | $ 110,019 | |||
Prepayment prior to the second-year anniversary | ||||
Debt | ||||
Prepayment premium percentage | 3.00% | |||
Prepayment on or after the second-year anniversary, but on or prior to the third-year anniversary | ||||
Debt | ||||
Prepayment premium percentage | 2.00% | |||
Prepayment on or after the third-year anniversary | ||||
Debt | ||||
Prepayment premium percentage | 1.00% | |||
Single voluntary prepayment of threshold amount prior to the second-year anniversary | ||||
Debt | ||||
Prepayment premium percentage | 5.00% | |||
LIBOR | ||||
Debt | ||||
Floor rate | 2.00% |
DEBT - Silicon Valley (Details)
DEBT - Silicon Valley (Details) - Silicon Valley Bank Term Loan Facility $ in Thousands | 1 Months Ended |
Jan. 31, 2020USD ($) | |
Loan and Security Agreements | |
Line of credit | $ 11,500 |
Prime | |
Loan and Security Agreements | |
Margin rate | 0.75% |
DEBT- Convertible Senior Notes
DEBT- Convertible Senior Notes (Details) $ / shares in Units, $ in Thousands | Feb. 13, 2020USD ($)D$ / shares | Dec. 31, 2021USD ($)D | Dec. 31, 2020USD ($) |
Debt | |||
Equity component of transaction costs for 2020 Convertible Notes | $ 1,773 | ||
Amortization period of debt discount | 6 years | ||
Initial carrying amount of the liability component | $ 97,200 | ||
Carrying amount of the equity component | 46,550 | ||
Convertible senior notes | $ 139,966 | 99,575 | |
Accumulated deficit | (256,342) | (333,147) | |
Additional paid-in capital | 502,095 | 519,143 | |
Adjustment. | Accounting Standards Update 2020-06 | |||
Debt | |||
Convertible senior notes | 39,489 | 39,489 | |
Accumulated deficit | 5,288 | (5,288) | |
Additional paid-in capital | 44,777 | $ (44,777) | |
Convertible senior notes | |||
Debt | |||
Interest rate (as a percent) | 2.625% | ||
Aggregate principal amount | $ 143,750 | ||
Total debt issuance cost | 5,473 | ||
Equity component of transaction costs for 2020 Convertible Notes | 1,773 | ||
Debt discount | $ 3,700 | ||
Amortization period of debt discount | 6 years | ||
Initial conversion rate | 34.2618 | ||
Initial conversion price | $ / shares | $ 29.19 | ||
Conversion, threshold percentage of stock price trigger | 130.00% | ||
Conversion, threshold trading days | D | 20 | ||
Conversion, threshold consecutive trading days | D | 30 | ||
Consecutive business days | D | 5 | ||
Measurement period | D | 10 | ||
Threshold percentage to product of sale price of common stock and conversion rate | 98.00% | ||
Default period | 30 days | ||
Threshold amount of money borrowed | $ 20,000 | ||
Convertible senior notes | $ 139,966 | ||
Convertible senior notes | Conversion of convertible debt after the calendar quarter ending on March 31, 2020 | |||
Debt | |||
Conversion, threshold percentage of stock price trigger | 130.00% | ||
Conversion, threshold trading days | D | 20 | ||
Conversion, threshold consecutive trading days | D | 30 |
DEBT - Outstanding (Details)
DEBT - Outstanding (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Debt | ||
Net carrying amount | $ 139,966 | $ 99,575 |
Convertible senior notes | ||
Debt | ||
Principal | 143,750 | |
Less: unamortized issuance costs | (3,784) | |
Net carrying amount | $ 139,966 | |
Debt instrument term | 6 years | |
Effective interest rate | 3.26% |
DEBT - Interest Expenses (Detai
DEBT - Interest Expenses (Details) - Convertible senior notes - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Debt | ||
Contractual interest expense | $ 3,773 | $ 3,323 |
Amortization of debt discount | 5,628 | |
Amortization of debt issuance costs | 902 | 447 |
Total interest expense | $ 4,675 | $ 9,398 |
DEBT - Future Minimum Payments
DEBT - Future Minimum Payments (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Principal repayments | ||
Convertible senior notes | $ 139,966 | $ 99,575 |
Convertible senior notes | ||
Principal repayments | ||
2022 | 3,773 | |
2023 | 3,773 | |
2024 | 3,773 | |
2025 | 3,773 | |
2026 | 145,638 | |
Total minimum payments | 160,730 | |
Less: interest | (16,980) | |
Less: unamortized issuance costs | (3,784) | |
Convertible senior notes | $ 139,966 |
LEASES - Operating Lease Arrang
LEASES - Operating Lease Arrangements (Details) $ in Thousands | 1 Months Ended | ||||
Mar. 31, 2018USD ($)ft²item$ / ft² | Jan. 31, 2016ft² | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2018 | |
Lessee, Lease, Description [Line Items] | |||||
Number of renewal periods | item | 2 | ||||
Operating lease assets | $ 7,644 | $ 8,391 | |||
Operating lease liabilities | $ 8,765 | ||||
CMO | |||||
Lessee, Lease, Description [Line Items] | |||||
Square of feet of space | ft² | 3,267 | ||||
Term of lease extension option | 2 years | ||||
Advance written notice termination period | 2 years | ||||
Vehicle leases | |||||
Lessee, Lease, Description [Line Items] | |||||
Lease term | 12 months | ||||
Stoughton, Massachusetts | |||||
Lessee, Lease, Description [Line Items] | |||||
Square of feet of space | ft² | 50,678 | ||||
Rent-free term | 4 months | ||||
Lease term | 10 years | ||||
Term of lease extension option | 5 years | ||||
Base rent | $ 1,214 | ||||
Annual base rent per rentable square foot | $ / ft² | 23.95 | ||||
Maximum | Stoughton, Massachusetts | |||||
Lessee, Lease, Description [Line Items] | |||||
Increase in annual base rent | 3.10% | ||||
Minimum | Stoughton, Massachusetts | |||||
Lessee, Lease, Description [Line Items] | |||||
Increase in annual base rent | 2.50% |
LEASES - Components of Lease Co
LEASES - Components of Lease Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Lease Cost | |||
Operating lease cost | $ 1,305 | $ 1,305 | $ 1,446 |
Short-term lease cost | 1,492 | 1,312 | 752 |
Variable lease cost | 292 | 331 | 283 |
Total lease cost | $ 3,089 | $ 2,948 | $ 2,481 |
LEASES - Lease Term and Discoun
LEASES - Lease Term and Discount Rate and Other Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
LEASES | |||
Weighted-average remaining lease term - operating leases (years) | 7 years 7 months 6 days | 8 years 7 months 6 days | |
Weighted-average discount rate - operating leases | 6.10% | 6.10% | |
Cash paid for amounts included in the measurement of operating lease liabilities | $ 1,286 | $ 1,249 | $ 1,133 |
LEASES - Future Minimum Lease P
LEASES - Future Minimum Lease Payments (Details) $ in Thousands | Dec. 31, 2021USD ($) |
Future minimum lease payments | |
2022 | $ 1,325 |
2023 | 1,363 |
2024 | 1,401 |
2025 | 1,439 |
2026 | 1,477 |
After 2026 | 4,060 |
Total minimum lease payments | 11,065 |
Less: Present value discount | 2,300 |
Present value of lease liabilities | $ 8,765 |
EQUITY (Details)
EQUITY (Details) - USD ($) $ / shares in Units, $ in Thousands | Jan. 07, 2022 | Nov. 15, 2021 | Jan. 07, 2022 | Dec. 31, 2021 | Oct. 31, 2021 | Aug. 31, 2021 | Nov. 30, 2018 | May 31, 2015 |
Equity | ||||||||
Share repurchase program authorized amount | $ 100,000 | $ 100,000 | ||||||
Treasury stock repurchased | $ 42,861 | |||||||
Reduction from outstanding shares | 1,026,694 | |||||||
Total cost of shares received | $ 42,861 | |||||||
Payments for repurchase of common stock | 47,861 | |||||||
Third Amendment to the Nucynta Commercialization Agreement | ||||||||
Equity | ||||||||
Number of shares that can be purchased | 1,041,667 | |||||||
Exercise price of warrant (in dollars per share) | $ 19.20 | |||||||
ASR | ||||||||
Equity | ||||||||
Share repurchase program authorized amount | $ 25,000 | |||||||
Price per share | $ 19.48 | |||||||
Percentage of upfront payment on a price per share | 80.00% | |||||||
Amount available for share repurchases under the program | $ 57,139 | |||||||
Shares repurchased during the period | 307,132 | 1,026,694 | 1,333,826 | 2,150,717 | ||||
Payments for repurchase of common stock | $ 25,000 | $ 42,861 | ||||||
Shares repurchased, cost per share | $ 19.93 | |||||||
2014 Stock Incentive Plan | ||||||||
Equity | ||||||||
Shares of common stock authorized for issuance (in shares) | 2,700,000 | |||||||
Increase in number of authorized shares on the first day of each fiscal year, as a percentage of outstanding common stock (as a percent) | 4.00% | |||||||
Shares of common stock remaining available for future grant (in shares) | 1,588,735 | |||||||
Vesting period (in years) | 4 years | |||||||
Contractual life (in years) | 10 years | |||||||
Minimum | 2014 Stock Incentive Plan | ||||||||
Equity | ||||||||
Period following termination date vested options are exercisable (in months) | 1 month | |||||||
Maximum | 2014 Stock Incentive Plan | ||||||||
Equity | ||||||||
Period following termination date vested options are exercisable (in months) | 3 months | |||||||
Subsequent Events | ASR | ||||||||
Equity | ||||||||
Amount available for share repurchases under the program | $ 5,000 | $ 5,000 |
STOCK - BASED COMPENSATION - Na
STOCK - BASED COMPENSATION - Narrative (Details) - USD ($) | 1 Months Ended | 12 Months Ended | ||||
Dec. 31, 2020 | Feb. 29, 2020 | Jan. 31, 2019 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Stock-based compensation | ||||||
Weighted-average grant date fair value per share of grants (in dollars per share) | $ 12.60 | $ 12.78 | $ 9.07 | |||
Proceeds from issuances of common stock from employee stock purchase plans | $ 755,000 | $ 758,000 | $ 817,000 | |||
Stock-based compensation expense | 24,255,000 | 21,910,000 | 16,528,000 | |||
Total intrinsic value of stock options exercised | $ 6,456,000 | 7,516,000 | 1,506,000 | |||
Performance share units | ||||||
Stock-based compensation | ||||||
Vesting period (in years) | 3 years | |||||
Performance period | 3 years | 3 years | ||||
Cumulative performance period | 2 years | 3 years | 3 years | |||
Unrecognized compensation cost related to outstanding options | $ 4,443,000 | |||||
Period over which unrecognized compensation cost is expected to be recognized as expense | 2 years | |||||
Stock-based compensation expense | $ 906,000 | $ 4,817,000 | 3,551,000 | 136,000 | ||
Total expense | $ 289,000 | $ 950,000 | $ 136,000 | |||
Share Based Compensation Arrangement By Share Based Payment Award Average Stock Price Period | 30 days | 30 days | ||||
Share Based Compensation Arrangement By Share Based Payment Award Period Of Cumulative Revenue Goals | 3 years | 3 years | ||||
Performance share units | Minimum | ||||||
Stock-based compensation | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 0.00% | 0.00% | 0.00% | |||
Performance share units | Maximum | ||||||
Stock-based compensation | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 200.00% | 200.00% | ||||
Restricted stock units | ||||||
Stock-based compensation | ||||||
Weighted-average grant date fair value of shares granted | $ 24.23 | $ 21.35 | $ 15.38 | |||
Total fair value of shares vested | $ 11,165,000 | $ 6,992,000 | $ 2,683,000 | |||
Share-based Payment Arrangement, Nonvested Award, Excluding Option, Cost Not yet Recognized, Amount | $ 24,936,000 | |||||
Period over which unrecognized compensation cost is expected to be recognized as expense | 2 years 8 months 12 days | |||||
Weighted-average grant date fair value of RSUs | $ 8,526,000 | 5,989,000 | 4,066,000 | |||
Stock options | ||||||
Stock-based compensation | ||||||
Employee Stock Purchase Plan, Purchase Price Percentage | 85.00% | |||||
Issuance for employee stock purchase plan, shares | 43,719 | |||||
Proceeds from issuances of common stock from employee stock purchase plans | $ 755,000 | |||||
Total purchased proceeds | 224,000 | $ 342,000 | $ 358,000 | |||
Unrecognized compensation cost related to outstanding options | $ 5,096,000 | |||||
Period over which unrecognized compensation cost is expected to be recognized as expense | 1 year 10 months 24 days | |||||
Shares of common stock authorized for issuance (in shares) | 1,618,246 |
STOCK - BASED COMPENSATION - Su
STOCK - BASED COMPENSATION - Summary of Restricted Stock and Performance Share Activity (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Performance share units | |||
Number of shares | |||
Balance | 283,223 | ||
Granted | 231,180 | ||
Vested | (66,974) | ||
Forfeited | (81,720) | ||
Performance adjustment | (12,609) | ||
Balance | 353,100 | 283,223 | |
Weighted-average grant date fair value per share | |||
Balance | $ 24.26 | ||
Granted | 35.15 | $ 28.49 | $ 15.90 |
Vested | 22.35 | ||
Forfeited | 30.66 | ||
Performance adjustment | 21.80 | ||
Balance | $ 31.77 | $ 24.26 | |
Restricted stock units | |||
Number of shares | |||
Balance | 1,242,387 | ||
Granted | 1,373,031 | ||
Vested | (444,769) | ||
Forfeited | (550,626) | ||
Balance | 1,620,023 | 1,242,387 | |
Weighted-average grant date fair value per share | |||
Balance | $ 19.42 | ||
Granted | 24.23 | ||
Vested | 19.17 | ||
Forfeited | 22.63 | ||
Balance | $ 22.48 | $ 19.42 |
STOCK - BASED COMPENSATION - _2
STOCK - BASED COMPENSATION - Summary of Stock Option Activity (Details) - Stock options - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Stock option activity | ||
Outstanding | 3,860,481 | |
Granted | 90,000 | |
Exercised | (803,485) | |
Cancelled | (418,827) | |
Outstanding | 2,728,169 | 3,860,481 |
Exercisable at end of period | 2,220,889 | |
Weighted average exercise price per share | ||
Outstanding | $ 17.78 | |
Granted | 21.03 | |
Exercised | 14.78 | |
Cancelled | 20.65 | |
Outstanding | 18.33 | $ 17.78 |
Exercisable at end of period | $ 18.26 | |
Stock option activity, additional information | ||
Outstanding Weighted-Average Remaining Contractual Term | 5 years 9 months 18 days | 7 years 2 months 12 days |
Outstanding Aggregate Intrinsic Value | $ 6,070 | $ 13,011 |
Exercisable at end of period, Weighted-Average Remaining Contractual Term | 5 years 3 months 18 days | |
Exercisable at end of period, Aggregate Intrinsic Value | $ 5,262 |
STOCK - BASED COMPENSATION - _3
STOCK - BASED COMPENSATION - Summary of Valuation Assumptions Used (Details) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Weighted-average assumptions used in the Black-Scholes option pricing model to determine the fair value of the employee stock option grants | |||
Risk-free interest rate | 0.70% | 1.30% | 2.40% |
Volatility | 67.20% | 66.20% | 63.30% |
Expected term (in years) | 6 years | 6 years | 6 years 1 month 6 days |
STOCK - BASED COMPENSATION - _4
STOCK - BASED COMPENSATION - Summary of Stock-Based Compensation Included in Statement of Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Stock-based compensation | |||
Total stock-based compensation expense | $ 24,255 | $ 21,910 | $ 16,528 |
Research and development | |||
Stock-based compensation | |||
Total stock-based compensation expense | 3,422 | 3,909 | 2,126 |
Selling, general and administrative expenses | |||
Stock-based compensation | |||
Total stock-based compensation expense | $ 20,833 | $ 18,001 | $ 14,402 |
INCOME TAXES - Reconciliation o
INCOME TAXES - Reconciliation of Income Tax Expense (Benefit) Computed at Statutory Federal Rate (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Current provision (benefit): | ||||||||||
State | $ 3,142 | $ 830 | ||||||||
Current provision (benefit) | 3,142 | 830 | ||||||||
Deferred provision (benefit): | ||||||||||
Federal | (61,445) | |||||||||
State | (16,588) | |||||||||
Deferred provision (benefit) | (78,033) | |||||||||
Income tax provision (benefit) | $ (13,842) | $ 991 | $ (61,852) | $ (188) | $ 304 | $ 280 | $ 246 | $ (74,891) | $ 830 | $ 0 |
Federal income tax expense at statutory rate (as a percent) | 21.00% | 21.00% | 21.00% | |||||||
(Increase) decrease income tax (benefit) resulting from: | ||||||||||
State income tax, net of federal benefit (as a percent) | 2.90% | 5.10% | 5.60% | |||||||
Permanent differences (as a percent) | (3.90%) | 1.10% | (1.40%) | |||||||
Stock compensation (as a percent) | (18.80%) | (3.00%) | (1.80%) | |||||||
Research and development credit (as a percent) | 16.30% | (1.10%) | 1.80% | |||||||
Change in valuation allowance (as a percent) | 2202.50% | (20.10%) | (25.20%) | |||||||
Effective income tax rate (as a percent) | 2220.00% | 3.00% |
INCOME TAXES - Other (Details)
INCOME TAXES - Other (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Deferred tax assets: | |||
U.S. and state net operating loss carryforwards | $ 31,400 | $ 57,457 | |
Research and development credits | 5,470 | 5,004 | |
Operating lease liabilities | 2,321 | 2,508 | |
Returns and discounts | 23,072 | 6,281 | |
Stock-based compensation | 7,838 | 7,133 | |
Accruals and other | 2,210 | 1,892 | |
Intangible assets | 12,699 | 1,297 | |
Total deferred tax assets | 85,010 | 81,572 | |
Valuation allowance | (1,966) | (65,661) | |
Deferred tax assets after valuation allowance | 83,044 | 15,911 | |
Deferred tax liabilities: | |||
Debt discount | (10,809) | ||
Operating lease assets | (2,024) | (2,217) | |
Depreciation | (2,978) | $ (2,885) | |
Net deferred tax assets | $ 78,042 | ||
Net operating loss carryforwards | |||
Minimum period, positive earnings history (in years) | 3 years | ||
Deferred tax benefit | $ 78,042 | ||
Federal corporate tax rate (as a percent) | 21.00% | 21.00% | 21.00% |
Reconciliation of gross unrecognized tax benefits - Federal, State and Foreign Tax | |||
Gross UTB Balance at beginning of period | $ 586 | $ 578 | $ 502 |
Additions based on tax positions related to the current year | 67 | 36 | 76 |
Additions for tax positions of prior years | 1 | ||
Reductions for tax positions of prior years | (28) | ||
Gross UTB Balance at end of period | 654 | 586 | 578 |
Net UTB impacting the effective tax rate at December 31 excluding valuation allowance impacts, if any | 500 | 560 | 549 |
U.S. federal | |||
Net operating loss carryforwards | |||
Operating loss carryforwards | 119,280 | 226,824 | 292,342 |
Research and development tax credit carryforwards, net | 4,503 | 4,623 | 4,044 |
State | |||
Net operating loss carryforwards | |||
Operating loss carryforwards | 103,044 | 170,280 | 222,629 |
Research and development tax credit carryforwards, net | $ 955 | $ 1,150 | $ 1,112 |
EMPLOYEE BENEFITS (Details)
EMPLOYEE BENEFITS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
EMPLOYEE BENEFITS | |||
Total expense for contributions made | $ 1,236 | $ 1,260 | $ 1,170 |
UNAUDITED QUARTERLY OPERATING_3
UNAUDITED QUARTERLY OPERATING RESULTS (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Product revenues, net | $ 27,362 | $ 78,843 | $ 82,942 | $ 87,721 | $ 76,271 | $ 79,176 | $ 78,058 | $ 76,511 | $ 276,868 | $ 310,016 | $ 296,701 |
Cost of product revenues (excluding intangible asset amortization) | 11,900 | 15,934 | 15,908 | 15,328 | 15,184 | 14,188 | 12,899 | 27,229 | 59,070 | 69,500 | 178,908 |
Intangible asset amortization | 16,795 | 16,796 | 16,795 | 16,795 | 16,795 | 16,795 | 16,795 | 10,295 | 67,181 | 60,680 | 14,752 |
Total cost of products revenues | 28,695 | 32,730 | 32,703 | 32,123 | 31,979 | 30,983 | 29,694 | 37,524 | 126,251 | 130,180 | 193,660 |
Gross profit | (1,333) | 46,113 | 50,239 | 55,598 | 44,292 | 48,193 | 48,364 | 38,987 | 150,617 | 179,836 | 103,041 |
Research and development | 1,609 | 1,450 | 3,462 | 2,930 | 2,472 | 2,141 | 2,493 | 2,666 | 9,451 | 9,772 | 10,340 |
Selling, general and administrative | 26,602 | 30,514 | 30,368 | 31,476 | 26,824 | 26,426 | 29,322 | 31,260 | 118,960 | 113,832 | 116,449 |
Restructuring | 4,578 | 4,578 | |||||||||
Total operating expenses | 32,789 | 31,964 | 33,830 | 34,406 | 29,296 | 28,567 | 31,815 | 33,926 | 132,989 | 123,604 | 126,789 |
Income (loss) from operations | (34,122) | 14,149 | 16,409 | 21,192 | 14,996 | 19,626 | 16,549 | 5,061 | 17,628 | 56,232 | (23,748) |
Interest expense | (4,757) | (5,115) | (5,421) | (5,721) | (7,737) | (8,063) | (8,259) | (4,823) | (21,014) | (28,882) | (909) |
Interest income | 3 | 3 | 3 | 3 | 3 | 3 | 14 | 212 | 12 | 232 | 1,935 |
(Loss) income before income taxes | (38,876) | 9,037 | 10,991 | 15,474 | 7,262 | 11,566 | 8,304 | 450 | (3,374) | 27,582 | (22,722) |
(Benefit from) provision for income taxes | (13,842) | 991 | (61,852) | (188) | 304 | 280 | 246 | (74,891) | 830 | 0 | |
Net income (loss) | $ (25,034) | $ 8,046 | $ 72,843 | $ 15,662 | $ 6,958 | $ 11,286 | $ 8,058 | $ 450 | $ 71,517 | $ 26,752 | $ (22,722) |
Earnings (loss) per share - basic (in dollars per share) | $ (0.73) | $ 0.23 | $ 2.06 | $ 0.45 | $ 0.20 | $ 0.33 | $ 0.23 | $ 0.01 | $ 2.05 | $ 0.78 | $ (0.68) |
Weighted-average shares - basic (in shares) | 34,123,309 | 35,373,909 | 35,302,608 | 34,951,740 | 34,592,277 | 34,540,126 | 34,395,266 | 34,100,688 | 34,936,817 | 34,407,959 | 33,453,844 |
Earnings (loss) per share - diluted (in dollars per share) | $ (0.73) | $ 0.22 | $ 1.79 | $ 0.41 | $ 0.20 | $ 0.32 | $ 0.23 | $ 0.01 | $ 1.86 | $ 0.76 | $ (0.68) |
Weighted-average shares - diluted (in shares) | 34,123,309 | 36,261,174 | 41,286,853 | 41,160,092 | 35,417,623 | 35,069,188 | 35,091,906 | 35,069,693 | 41,045,805 | 35,151,353 | 33,453,844 |
Selling, general and administrative expenses | |||||||||||
Litigation settlements | $ 2,935 | ||||||||||
Xtampza ER | |||||||||||
Product revenues, net | $ 103,708 | $ 127,984 | $ 105,012 | ||||||||
Nucynta Products | |||||||||||
Product revenues, net | $ 173,160 | $ 182,032 | $ 191,689 | ||||||||
Estimates of Product Returned [Member] | Adjustment | |||||||||||
Product revenues, net | (38,329) | ||||||||||
Estimates of Product Returned [Member] | Adjustment | Xtampza ER | |||||||||||
Product revenues, net | (13,787) | ||||||||||
Estimates of Product Returned [Member] | Adjustment | Nucynta Products | |||||||||||
Product revenues, net | $ (24,542) |
BIODELIVERY SCIENCES INTERNAT_2
BIODELIVERY SCIENCES INTERNATIONAL, INC. ACQUISITION (Details) - Subsequent Events - BioDelivery Sciences International, Inc $ / shares in Units, $ in Millions | Feb. 14, 2022USD ($)$ / shares |
BIODELIVERY SCIENCES INTERNATIONAL, INC. ACQUISITION | |
Acquisition business per share | $ / shares | $ 5.60 |
Senior Secured Term Loan Facility | |
BIODELIVERY SCIENCES INTERNATIONAL, INC. ACQUISITION | |
Debt instrument term | 4 years |
Debt instrument, payment terms | quarterly |
Aggregate principal amount | $ 650 |
Aggregate annual principal amount | 100 |
Total term notes | $ 550 |
Remaining installments term | 3 years |
Floor rate | 1.20% |
Percentage of one-time fee | 2.00% |
Percentage of one-time fee due at the time of closing | 1.00% |
LIBOR | Senior Secured Term Loan Facility | |
BIODELIVERY SCIENCES INTERNATIONAL, INC. ACQUISITION | |
Variable interest rate margin (as a percent) | 7.50% |