Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2017 | Apr. 30, 2017 | |
Document and Entity Information | ||
Entity Registrant Name | ACCELERON PHARMA INC | |
Entity Central Index Key | 1,280,600 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 38,617,783 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 33,157 | $ 20,950 |
Collaboration receivables (all amounts are with related party) | 3,570 | 3,234 |
Prepaid expenses and other current assets | 4,086 | 3,862 |
Short-term investments | 108,220 | 118,740 |
Total current assets | 149,033 | 146,786 |
Property and equipment, net | 7,107 | 5,201 |
Restricted cash | 1,132 | 946 |
Other assets | 20 | 22 |
Long-term investments | 71,837 | 94,692 |
Total assets | 229,129 | 247,647 |
Current liabilities: | ||
Accounts payable | 911 | 1,590 |
Accrued expenses | 12,968 | 13,249 |
Deferred revenue | 541 | 541 |
Deferred rent | 773 | 769 |
Total current liabilities | 15,193 | 16,149 |
Deferred revenue, net of current portion | 3,567 | 3,704 |
Deferred rent, net of current portion | 760 | 953 |
Warrants to purchase common stock | 1,289 | 1,244 |
Total liabilities | 20,809 | 22,050 |
Commitments and contingencies (Note 14) | ||
Stockholders’ equity: | ||
Undesignated preferred stock, $0.001 par value: 25,000,000 shares authorized and no shares issued or outstanding | 0 | 0 |
Common stock, $0.001 par value: 175,000,000 shares authorized; 38,596,062 and 38,251,826 shares issued and outstanding at March 31, 2017 and December 31, 2016, respectively | 39 | 39 |
Additional paid-in capital | 598,658 | 590,474 |
Accumulated deficit | (389,977) | (364,491) |
Accumulated other comprehensive loss | (400) | (425) |
Total stockholders’ equity | 208,320 | 225,597 |
Total liabilities and stockholders’ equity | $ 229,129 | $ 247,647 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Mar. 31, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 25,000,000 | 25,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 175,000,000 | 175,000,000 |
Common stock, shares issued | 38,596,062 | 38,251,826 |
Common stock, shares outstanding | 38,596,062 | 38,251,826 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Collaboration revenue: | ||
License and milestone | $ 135 | $ 15,144 |
Cost-sharing, net | 3,570 | 3,057 |
Total revenue (all amounts are with related party) | 3,705 | 18,201 |
Costs and expenses: | ||
Research and development | 21,727 | 16,246 |
General and administrative | 7,836 | 5,911 |
Total costs and expenses | 29,563 | 22,157 |
Loss from operations | (25,858) | (3,956) |
Other (expense) income, net | (45) | 8,683 |
Interest income | 502 | 334 |
(Loss) income before income taxes | (25,401) | 5,061 |
Income tax expense | (6) | 0 |
Net (loss) income | (25,407) | 5,061 |
Net (loss) income applicable to common stockholders-basic and diluted | $ (25,407) | $ 5,061 |
Net (loss) income per share applicable to common stockholders: (Note 9) | ||
Basic (in dollars per share) | $ (0.66) | $ 0.14 |
Diluted (in dollars per share) | $ (0.66) | $ 0.13 |
Weighted-average number of common shares used in computing net (loss) income per share applicable to common stockholders: | ||
Basic (in shares) | 38,404 | 36,911 |
Diluted (in shares) | 38,404 | 38,666 |
Other comprehensive (loss) income: | ||
Net (loss) income | $ (25,407) | $ 5,061 |
Net unrealized holding gains on short-term and long-term investments during the period | 25 | 245 |
Comprehensive (loss) income | $ (25,382) | $ 5,306 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Operating Activities | ||
Net (loss) income | $ (25,407) | $ 5,061 |
Adjustments to reconcile net (loss) income to net cash (used in) or provided by operating activities: | ||
Depreciation and amortization | 541 | 324 |
Stock-based compensation | 6,583 | 4,248 |
Change in fair value of warrants | 45 | (8,683) |
Net amortization of premium on investments | 88 | (100) |
Changes in assets and liabilities: | ||
Prepaid expenses and other assets | (222) | (699) |
Collaboration receivables | (336) | 571 |
Accounts payable | (778) | (42) |
Accrued expenses | (1,951) | 129 |
Restricted cash | (186) | (199) |
Deferred revenue | (137) | (144) |
Deferred rent | (189) | 473 |
Net cash (used in) or provided by operating activities | (21,949) | 939 |
Investing Activities | ||
Purchases of investments | (221) | (125,524) |
Proceeds from sales and maturities of investments | 33,533 | 19,096 |
Purchases of property and equipment | (677) | (489) |
Net cash provided by (used in) investing activities | 32,635 | (106,917) |
Financing Activities | ||
Proceeds from issuance of common stock from public offering, net issuance costs | 0 | 140,760 |
Payments for withholding taxes on restricted stock units | (140) | 0 |
Proceeds from exercise of stock options and warrants to purchase common stock | 1,151 | 732 |
Proceeds from issuances of common stock related to employee stock purchase plan | 510 | 384 |
Net cash provided by financing activities | 1,521 | 141,876 |
Net increase in cash and cash equivalents | 12,207 | 35,898 |
Cash and cash equivalents at beginning of period | 20,950 | 27,783 |
Cash and cash equivalents at end of period | 33,157 | 63,681 |
Supplemental Disclosure of Non-Cash Investing and Financing Activities: | ||
Follow-on offering costs included in accounts payable and accrued expenses | 0 | 369 |
Purchase of property and equipment included in accounts payable and accrued expenses | $ 1,769 | $ 453 |
Nature of Business
Nature of Business | 3 Months Ended |
Mar. 31, 2017 | |
Nature of Business | |
Nature of Business | Nature of Business Acceleron Pharma Inc. (Acceleron or the Company) is a Cambridge, Massachusetts-based clinical stage biopharmaceutical company focused on the discovery, development and commercialization of innovative therapeutics to treat serious and rare diseases. The Company’s research focuses on key natural regulators of cellular growth and repair, particularly the Transforming Growth Factor-Beta (TGF-beta) protein superfamily. By combining its discovery and development expertise, including its proprietary knowledge of the TGF-beta superfamily, and its internal protein engineering and manufacturing capabilities, the Company has built a highly productive discovery and development platform that has generated innovative therapeutic candidates with novel mechanisms of action. The Company has four internally discovered therapeutic candidates that are currently in clinical trials. The Company is subject to risks common to companies in the biotechnology industry, including, but not limited to, risk that the Company never achieves profitability, the need for substantial additional financing, risk of relying on third parties, risks of clinical trial failures, dependence on key personnel, protection of proprietary technology and compliance with government regulations. |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying interim condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP). Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification (ASC) and Accounting Standards Update (ASU) of the Financial Accounting Standards Board (FASB). The accompanying interim condensed consolidated financial statements are unaudited. The unaudited interim financial statements have been prepared on the same basis as the audited annual financial statements as of and for the year ended December 31, 2016 , and, in the opinion of management, reflect all adjustments, consisting of normal recurring adjustments, necessary for the fair presentation of the Company’s financial position as of March 31, 2017 , and the results of its operations and its cash flows for the three months ended March 31, 2017 and 2016 . The results for the three months ended March 31, 2017 are not necessarily indicative of the results to be expected for the year ending December 31, 2017 , any other interim periods, or any future year or period. These interim financial statements should be read in conjunction with the audited financial statements as of and for the year ended December 31, 2016 , and the notes thereto, together with Management’s Discussion and Analysis of Financial Condition and Results of Operations, contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 . The accompanying interim condensed consolidated financial statements reflect the application of certain significant accounting policies as described below and elsewhere in these notes to the financial statements. As of March 31, 2017 , the Company’s significant accounting policies and estimates, which are detailed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 , have not changed, except for the adoption of Accounting Standards Update (ASU) No. 2016-09, Compensation - Stock Compensation (Topic 718), Improvements to Employee Share-Based Payment Accounting, which is discussed further in Note 16 . |
Use of Estimates
Use of Estimates | 3 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts expensed during the reporting period. Management considers many factors in selecting appropriate financial accounting policies and controls, and in developing the estimates and assumptions that are used in the preparation of these consolidated financial statements. Management must apply significant judgment in this process. In addition, other factors may affect estimates, including: expected business and operational changes, sensitivity and volatility associated with the assumptions used in developing estimates, and whether historical trends are expected to be representative of future trends. The estimation process often may yield a range of potentially reasonable estimates of the ultimate future outcomes and management must select an amount that falls within that range of reasonable estimates. This process may result in actual results differing materially from those estimated amounts used in the preparation of the consolidated financial statements if these results differ from historical experience, or other assumptions do not turn out to be substantially accurate, even if such assumptions are reasonable when made. In preparing these consolidated financial statements, management used significant estimates in the following areas, among others: revenue recognition, stock-based compensation expense, the determination of the fair value of stock-based awards, the fair value of liability-classified warrants, accrued expenses, and the recoverability of the Company’s net deferred tax assets and related valuation allowance. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, or decision making group, in making decisions on how to allocate resources and assess performance. The Company’s chief operating decision maker is the chief executive officer. The Company and the chief executive officer view the Company’s operations and manage its business as one operating segment, which is the discovery, development and commercialization of highly innovative therapeutics to treat serious and rare diseases. All material long-lived assets of the Company reside in the United States. The Company does use contract research organizations (CROs) and research institutions located outside the United States. Some of these expenses are subject to collaboration reimbursement which is presented as a component of cost sharing, net in the consolidated statements of operations and comprehensive (loss) income. |
Cash Equivalents and Short-term
Cash Equivalents and Short-term and Long-term Investments | 3 Months Ended |
Mar. 31, 2017 | |
Cash and Cash Equivalents [Abstract] | |
Cash Equivalents and Short-term and Long-term Investments | Cash Equivalents and Short-term and Long-term Investments The Company considers all highly liquid investments purchased with original maturities of 90 days or less at acquisition to be cash equivalents. Cash and cash equivalents include cash held in banks and amounts held in interest-bearing money market accounts. Cash equivalents are carried at cost, which approximates their fair market value. The Company determines the appropriate classification of marketable securities at the time of purchase and reevaluates such designation at each balance sheet date. The Company has classified all of its marketable securities at March 31, 2017 as “available-for-sale” pursuant to ASC 320, Investments – Debt and Equity Securities. The Company records available-for-sale securities at fair value, with the unrealized gains and losses included in accumulated other comprehensive income (loss) in stockholders’ equity. There were no realized gains or losses on marketable securities for the three months ended March 31, 2017 and 2016 . Investments not classified as cash equivalents are presented as either short-term or long-term investments based on both their maturities as well as the time period the Company intends to hold such securities. The Company adjusts the cost of available-for-sale debt securities for amortization of premiums and accretion of discounts to maturity. The Company includes such amortization and accretion in interest income. The cost of securities sold is based on the specific identification method. The Company includes in interest income interest and dividends on securities classified as available-for-sale. The Company reviews marketable securities for other-than-temporary impairment whenever the fair value of a marketable security is less than the amortized cost and evidence indicates that a marketable security’s carrying amount is not recoverable within a reasonable period of time. Other-than-temporary impairments of investments are recognized in the consolidated statements of operations if the Company has experienced a credit loss, has the intent to sell the marketable security, or if it is more likely than not that the Company will be required to sell the marketable security before recovery of the amortized cost basis. Evidence considered in this assessment includes reasons for the impairment, compliance with the Company’s investment policy, the severity and the duration of the impairment and changes in value subsequent to the end of the period. The aggregate fair value of securities held by the Company in an unrealized loss position for less than twelve months as of March 31, 2017 and December 31, 2016 was $159.2 million and $172.2 million , respectively. The aggregate fair value of securities held by the Company in an unrealized loss position for more than twelve months as of March 31, 2017 was $2.5 million . The aggregate unrealized loss for those securities in an unrealized loss position for more than twelve months is $202 . As a result, the Company determined it did not hold any investments with any other-than-temporary impairment as of March 31, 2017 and December 31, 2016 . The following is a summary of cash, cash equivalents and available-for-sale securities as of March 31, 2017 and December 31, 2016 (in thousands): March 31, 2017 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Cash and cash equivalents due in 90 days or less $ 33,157 $ — $ — $ 33,157 Available-for-sale securities: Corporate obligations due in one year or less 44,328 — (74 ) 44,254 Corporate obligations due in more than one year 27,819 2 (113 ) 27,708 U.S. Treasury securities due in one year or less 17,494 — (14 ) 17,480 U.S. Treasury securities due in more than one year 11,536 — (52 ) 11,484 Certificates of deposit due in one year or less 9,665 — — 9,665 Certificates of deposit due in more than one year 6,665 — — 6,665 Mortgage and other asset backed securities due in one year or less 36,860 — (40 ) 36,820 Mortgage and other asset backed securities due in more than one year 26,090 — (109 ) 25,981 Total available-for-sale securities 180,457 2 (402 ) 180,057 Total cash, cash equivalents and available-for-sale securities $ 213,614 $ 2 $ (402 ) $ 213,214 December 31, 2016 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Cash and cash equivalents due in 90 days or less $ 20,950 $ — $ — $ 20,950 Available-for-sale securities: Corporate obligations due in one year or less 45,839 1 (58 ) $ 45,782 Corporate obligations due in more than one year 42,895 — (185 ) 42,710 U.S. Treasury securities due in one year or less 22,490 — (10 ) 22,480 U.S. Treasury securities due in more than one year 11,541 — (53 ) 11,488 Certificates of deposit due in one year or less 13,562 — — 13,562 Certificates of deposit due in more than one year 9,811 — — 9,811 Mortgage and other asset backed securities due in one year or less 36,948 — (32 ) 36,916 Mortgage and other asset backed securities due in more than one year 30,771 — (88 ) 30,683 Total available-for-sale securities 213,857 1 (426 ) 213,432 Total cash, cash equivalents and available-for-sale securities $ 234,807 $ 1 $ (426 ) $ 234,382 |
Restricted Cash
Restricted Cash | 3 Months Ended |
Mar. 31, 2017 | |
Receivables [Abstract] | |
Restricted Cash | Restricted Cash As of March 31, 2017 and December 31, 2016 , the Company maintained letters of credit totaling $1.1 million and $0.9 million, respectively, held in the form of certificates of deposit and money market funds as collateral for the Company's facility lease obligation and its credit cards. |
Concentrations of Credit Risk a
Concentrations of Credit Risk and Off-Balance Sheet Risk | 3 Months Ended |
Mar. 31, 2017 | |
Risks and Uncertainties [Abstract] | |
Concentrations of Credit Risk and Off-Balance Sheet Risk | Concentrations of Credit Risk and Off-Balance Sheet Risk The Company has no off-balance sheet risk, such as foreign exchange contracts, option contracts, or other foreign hedging arrangements. Financial instruments that potentially subject the Company to concentrations of credit risk are primarily cash, cash equivalents, restricted cash, short-term and long-term investments and collaboration receivables. The Company maintains its cash and cash equivalent balances and short-term and long-term investments with financial institutions that management believes are creditworthy. Short-term and long-term investments consist of investment grade corporate obligations, treasury notes, asset backed securities, and certificates of deposit. The Company’s investment policy includes guidelines on the quality of the institutions and financial instruments and defines allowable investments that the Company believes minimizes the exposure to concentrations of credit risk. The Company routinely assesses the creditworthiness of its customers and collaboration partners. The Company has not experienced any material losses related to receivables from individual customers and collaboration partners, or groups of customers. The Company does not require collateral. Due to these factors, no additional credit risk beyond amounts provided for collection losses is believed by management to be probable in the Company’s collaboration receivables. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The following tables set forth the Company’s financial instruments carried at fair value using the lowest level of input applicable to each financial instrument as of March 31, 2017 and December 31, 2016 (in thousands): March 31, 2017 Quoted Prices in Active Markets for Identical Items (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Assets: Money market funds $ 31,820 $ — $ — $ 31,820 Corporate obligations — 71,962 — 71,962 U.S. Treasury securities — 28,963 — 28,963 Certificates of deposit — 16,330 — 16,330 Mortgage and other asset backed securities — 62,802 — 62,802 Restricted cash 1,132 — — 1,132 Total assets $ 32,952 $ 180,057 $ — $ 213,009 Liabilities: Warrants to purchase common stock $ 1,289 $ 1,289 Total liabilities $ — $ — $ 1,289 1,289 December 31, 2016 Quoted Prices in Active Markets for Identical Items (Level 1) Significant other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Assets: Money market funds $ 19,818 $ — $ — $ 19,818 Corporate obligations — 88,492 — 88,492 U.S. Treasury securities — 33,968 — 33,968 Certificates of deposit — 23,373 — 23,373 Mortgage and other asset backed securities — 67,599 — 67,599 Restricted cash 946 — — 946 Total assets $ 20,764 $ 213,432 $ — $ 234,196 Liabilities: Warrants to purchase common stock $ — $ — $ 1,244 $ 1,244 Total liabilities $ — $ — $ 1,244 $ 1,244 The money market funds noted above are included in cash and cash equivalents in the accompanying condensed consolidated balance sheets. The Company recognizes transfers between levels of the fair value hierarchy as of the end of the reporting period. There were no transfers within the hierarchy during the three months ended March 31, 2017 or the year ended December 31, 2016 . Items measured at fair value on a recurring basis include short-term and long-term investments (Note 5), and warrants to purchase common stock (Note 13). During the periods presented, the Company has not changed the manner in which it values assets and liabilities that are measured at fair value using Level 3 inputs. The following table sets forth a summary of changes in the fair value of the Company’s common stock warrant liabilities, which represent a recurring measurement that is classified within Level 3 of the fair value hierarchy, wherein fair value is estimated using significant unobservable inputs (in thousands): Three Months Ended March 31, 2017 2016 Beginning balance $ 1,244 $ 17,187 Change in fair value 45 (8,683 ) Ending balance $ 1,289 $ 8,504 The fair value of the warrants to purchase common stock on the date of issuance and on each re-measurement date for those warrants classified as liabilities was estimated using either the Monte Carlo simulation framework, which incorporates future financing events over the remaining life of the warrants to purchase common stock, or for certain re-measurement dates, due to the warrants being deeply in the money, the Black-Scholes option pricing model. Due to the nature of these inputs, the valuation of the warrants is considered a Level 3 measurement. At each reporting period, the Company evaluates the best valuation methodology. At March 31, 2017 , the Black-Scholes option pricing model was used. The Company measures eligible assets and liabilities at fair value, with changes in value recognized in earnings. Fair value treatment may be elected either upon initial recognition of an eligible asset or liability or, for an existing asset or liability, if an event triggers a new basis of accounting. The Company did not elect to re-measure any of its existing financial assets or liabilities, and did not elect the fair value option for any financial assets and liabilities transacted in the three months ended March 31, 2017 or the year ended December 31, 2016 . |
Net (Loss) Income Per Share
Net (Loss) Income Per Share | 3 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share [Abstract] | |
Net (Loss) Income Per Share | Net (Loss) Income Per Share A reconciliation of the number of shares used in the calculation of basic and diluted net (loss) income per share is as follows (in thousands): Three Months Ended 2017 2016 Weighted-average number of common shares used in calculating basic net (loss) income per common share 38,404 36,911 Weighted-average number of common shares issuable upon exercise of outstanding stock options, based on treasury stock method — 1,389 Weighted-average number of common shares issuable upon exercise of outstanding common stock warrants, based on treasury stock method — 318 Weighted-average number of common shares issuable under the employee stock purchase plan, based on treasury stock method — 3 Weighted-average number of common shares issuable upon vesting of outstanding restricted stock units — 45 Weighted-average number of common shares used in computing diluted net (loss) income per common share 38,404 38,666 The following common stock equivalents were excluded from the calculation of diluted net (loss) income per share for the periods indicated because their inclusion would have had an anti-dilutive effect (in thousands): Three Months Ended 2017 2016 Outstanding stock options 3,583 1,458 Common stock warrants 63 — Shares issuable under employee stock purchase plan 15 1 Restricted stock units 807 34 4,468 1,493 |
Comprehensive (Loss) Income
Comprehensive (Loss) Income | 3 Months Ended |
Mar. 31, 2017 | |
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |
Comprehensive (Loss) Income | Comprehensive (Loss) Income Comprehensive (loss) income is defined as the change in equity of a business enterprise during a period from transactions, other events, and circumstances from non-owner sources. Comprehensive loss consists of net loss and other comprehensive loss, which includes certain changes in equity that are excluded from net loss. Comprehensive loss has been disclosed in the accompanying consolidated statements of operations and comprehensive loss. Accumulated other comprehensive (loss) income is presented separately on the consolidated balance sheets and consists entirely of unrealized holding gains on investments as of March 31, 2017 and December 31, 2016 . |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events The Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the financial statements to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. The Company has evaluated all subsequent events and determined that there are no material recognized or unrecognized subsequent events requiring disclosure. |
Recently Adopted Accounting Pro
Recently Adopted Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2017 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (FASB) or other standard setting bodies and adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on its financial position or results of operations upon adoption. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) , which supersedes all existing revenue recognition requirements, including most industry-specific guidance. The new standard requires a company to recognize revenue when it transfers goods or services to customers in an amount that reflects the consideration that the company expects to receive for those goods or services. The new standard will be effective for the Company on January 1, 2018. Topic 606 allows for either a full retrospective application, in which the standard is applied to all periods presented, or a modified retrospective application, in which the standard is applied to the most current period presented in the financial statements. As of March 31, 2017 , revenue is generated exclusively from the Company's collaboration agreement with Celgene. The Company is currently evaluating the potential impact that Topic 606 may have on its financial position and results of operations as it relates to this single arrangement, and expects to elect the modified retrospective application as its transition method. In February 2016 the FASB issued ASU 2016-02, Leases (Topic 842), Amendments to the FASB Accounting Standards Codification, which replaces the existing guidance for leases. ASU 2016-02 requires the identification of arrangements that should be accounted for as leases by lessees. In general, for lease arrangements exceeding a twelve month term, these arrangements must now be recognized as assets and liabilities on the balance sheet of the lessee. Under ASU 2016-02, a right-of-use asset and lease obligation will be recorded for all leases, whether operating or financing, while the income statement will reflect lease expense for operating leases and amortization/interest expense for financing leases. The balance sheet amount recorded for existing leases at the date of adoption of ASU 2016-02 must be calculated using the applicable incremental borrowing rate at the date of adoption. In addition, ASU 2016-02 requires the use of the modified retrospective method, which will require adjustment to all comparative periods presented in the consolidated financial statements. This guidance is effective for annual and interim periods beginning after December 15, 2018 and requires retrospective application. The Company is currently assessing the impact that adopting ASU 2016-02 will have on its consolidated financial statements and related disclosures. In June 2016 the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments . This new standard changes the impairment model for most financial assets and certain other instruments. Under the new standard, entities holding financial assets and net investment in leases that are not accounted for at fair value through net income to be presented at the net amount expected to be collected. An allowance for credit losses will be a valuation account that will be deducted from the amortized cost basis of the financial asset to present the net carrying value at the amount expected to be collected on the financial asset. This guidance is effective for annual and interim reporting periods beginning after December 15, 2019, with early adoption permitted. The adoption of this standard is not expected to have a material impact on the Company's financial position or results of operations. In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows - Restricted Cash (Topic 230) . This new standard requires companies to include amounts generally described as restricted cash and restricted cash equivalents in cash and cash equivalents when reconciling beginning-of-period and end-of-period total amounts shown on the statement of cash flows. This guidance is effective for annual and interim reporting periods beginning after December 15, 2017, and requires retrospective application. The Company is currently assessing the impact that adopting ASU 2016-18 will have on its consolidated financial statements and related disclosures. In December 2016, the FASB issued ASU 2016-19, Technical Corrections and Improvements . This new standard is intended to clarify guidance or correct references in the Accounting Standards Codification that could potentially result in changes in current practice because of either misapplication or misunderstanding of current guidance. The amendments of the standard that require transition guidance are effective for annual and interim reporting periods beginning after December 15, 2016, and early adoption is permitted. All other amendments were effective immediately. The Company adopted the standard effective January 1, 2017, and it did not have a material impact on the Company's financial position or results of operations. In March 2017, the FASB issued ASU 2017-08, Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities. This new standard shortens the amortization period for certain callable debt securities held at a premium. Specifically, the amendment requires the premium to be amortized to the earliest call date. The amendment does not require an accounting change for securities held at a discount; the discount continues to be amortized to maturity. The guidance is effective for annual and interim periods beginning after December 15, 2018, and early adoption is permitted. The amendment should be applied on a modified retrospective basis, with the cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. The Company is currently assessing the impact that adopting ASU 2017-08 will have on its consolidated financial statements and related disclosures. |
Warrants
Warrants | 3 Months Ended |
Mar. 31, 2017 | |
Warrants and Rights Note Disclosure [Abstract] | |
Warrants | Warrants Below is a summary of the number of shares issuable upon exercise of outstanding warrants and the terms and accounting treatment for the outstanding warrants (in thousands, except per share data): Warrants as of Weighted- Average Exercise Balance Sheet Classification March 31, 2017 December 31, 2016 Price Per Share Expiration March 31, 2017 December 31, 2016 Warrants to purchase common stock 61 61 $ 5.88 June 10, 2020 - July 9, 2020 Liability Liability Warrants to purchase common stock 3 4 7.40 December 31, 2017 Equity(1) (2) Equity(1) (2) All warrants 64 65 $ 5.94 (1) In March 2017, warrant holders exercised warrants to purchase 1,187 shares of Common Stock on a net basis, resulting in the issuance of 1,014 shares of Common Stock. (2) Warrants to purchase common stock were issued in connection with various debt financing transactions that were consummated in periods prior to December 31, 2012. In connection with the Series E redeemable convertible preferred stock (Series E Preferred Stock) financing transactions that took place in June 2010 and July 2010, the Company issued warrants to purchase up to 871,580 shares of common stock. Each warrant was immediately exercisable and expires ten years from the original date of issuance. The warrants to purchase shares of the Company’s common stock have an exercise price equal to the estimated fair value of the underlying instrument as of the initial date such warrants were issued. Each warrant is exercisable on either a physical settlement or net share settlement basis from the date of issuance. The warrant agreement contains a provision requiring an adjustment to the number of shares in the event the Company issues common stock, or securities convertible into or exercisable for common stock, at a price per share lower than the warrant exercise price. The Company concluded the anti-dilution feature required the warrants to be classified as liabilities under ASC Topic 815, Derivatives and Hedging—Contracts in Entity’s Own Equity (ASC 815). The warrants are measured at fair value, with changes in fair value recognized as a gain or loss to other income (expense) in the statements of operations and comprehensive income (loss) for each reporting period thereafter. The fair value of the common stock warrants was recorded as a discount to the preferred stock issued, and the preferred stock was accreted to the redemption value. At the end of each reporting period, the Company re-measured the fair value of the outstanding warrants, using current assumptions, resulting in an increase in fair value of $45 thousand and a decrease of $8.7 million for the three months ended March 31, 2017 and 2016 , respectively, which was recorded in other (expense) income in the accompanying consolidated statements of operations and comprehensive loss. The Company will continue to re-measure the fair value of the liability associated with the warrants to purchase common stock at the end of each reporting period until the earlier of the exercise or the expiration of the applicable warrants. All remaining outstanding warrants were fully vested and exercisable as of March 31, 2017 and December 31, 2016 . |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal Proceedings The Company, from time to time, may be party to litigation arising in the ordinary course of its business. The Company was not subject to any material legal proceedings during the three months ended March 31, 2017 , and, to the best of its knowledge, no material legal proceedings are currently pending or threatened. Other The Company is also party to various agreements, principally relating to licensed technology, that require future payments relating to milestones not met at March 31, 2017 and December 31, 2016 , or royalties on future sales of specified products. No milestones or royalty payments under these agreements are expected to be payable in the immediate future. See Note 15 for discussion of these arrangements. The Company enters into standard indemnification agreements in the ordinary course of business. Pursuant to the agreements, the Company indemnifies, holds harmless, and agrees to reimburse the indemnified party for losses suffered or incurred by the indemnified party, generally the Company’s business partners or customers, in connection with any U.S. patent or any copyright or other intellectual property infringement claim by any third party with respect to the Company’s products. The term of these indemnification agreements is generally perpetual any time after execution of the agreement. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited. The Company has never incurred costs to defend lawsuits or settle claims related to these indemnification agreements. |
Significant Agreements
Significant Agreements | 3 Months Ended |
Mar. 31, 2017 | |
Significant Agreements [Abstract] | |
Significant Agreements | Significant Agreements Celgene Overview On February 20, 2008 the Company entered into a collaboration, license, and option agreement with Celgene Corporation (Celgene) relating to sotatercept (the Sotatercept Agreement). On August 2, 2011, the Company entered into a second collaboration, license and option agreement with Celgene for luspatercept (the Luspatercept Agreement), and also amended certain terms of the Sotatercept Agreement. These agreements provide Celgene exclusive licenses for sotatercept and luspatercept in all indications, as well as exclusive rights to obtain a license to certain future compounds. Celgene is is an integrated global biopharmaceutical company engaged primarily in the discovery, development and commercialization of innovative therapies for the treatment of cancer and inflammatory diseases through next-generation solutions in protein homeostasis, immuno-oncology, epigenetics, immunology and neuro-inflammation. There have been no material changes to the key terms of the Sotatercept and Luspatercept Agreements since December 31, 2016 . For further information on the terms of the agreements as well as the historical accounting analysis, please see the notes to the consolidated financial statements included in the Company’s Form 10-K for the year ended December 31, 2016 . Sotatercept Agreement Under the terms of the Sotatercept Agreement, the Company and Celgene collaborate worldwide for the joint development and commercialization of sotatercept. The Company also granted Celgene an option to license three discovery stage compounds. Under the terms of the agreement, the Company and Celgene jointly develop, manufacture and commercialize sotatercept. The Company retained responsibility for research and development through the end of Phase 2a clinical trials, as well as manufacturing the clinical supplies for these trials. These activities were substantially completed in 2011. Celgene will be responsible for any Phase 3 clinical trials, as well as additional Phase 2 clinical trials, and will be responsible for overseeing the manufacture of Phase 3 and commercial supplies by third party contract manufacturing organizations. Through March 31, 2017 , the Company has received $43.9 million in research and development funding and milestone payments for sotatercept under the original and modified agreements. The next likely clinical milestone payment would be $10.0 million and result from Celgene’s start of a Phase 3 study. Luspatercept Agreement Under the terms of the Luspatercept Agreement, the Company and Celgene collaborate worldwide for the joint development and commercialization of luspatercept. The Company also granted Celgene an option for future products for which the Company files an Investigational New Drug application for the treatment of anemia. The Company has not yet identified additional compounds for the treatment of anemia. Accordingly, there is no assurance that the Company will generate future value from additional programs. The Company retains responsibility for research and development through the end of Phase 1 and initial Phase 2 clinical trials, as well as manufacturing the clinical supplies for these studies. Celgene will conduct subsequent Phase 2 and Phase 3 clinical studies. The Company will manufacture luspatercept for the Phase 1 and Phase 2 clinical trials and Celgene will be responsible for overseeing the manufacture of Phase 3 and commercial supplies by third party contract manufacturing organizations. Through March 31, 2017 , the Company has received $90.3 million in research and development funding and milestone payments for luspatercept. The next likely milestone payment would be $25.0 million and result from U.S. Food and Drug Administration or European Medical Association acceptance of a Biologics Licensing Application or equivalent for luspatercept in either myelodysplastic syndromes or beta-thalassemia. Both Agreements The Company and Celgene shared development costs under the Sotatercept and Luspatercept Agreements through December 31, 2012. Since January 1, 2013, Celgene has been responsible for paying 100% of worldwide development costs under both agreements. Celgene will be responsible for all commercialization costs worldwide. The Company has the right to co-promote sotatercept, luspatercept and future products under both agreements in North America. Celgene’s option to buy down royalty rates for sotatercept and luspatercept expired unexercised and, therefore, the Company will receive tiered royalties in the low-to-mid 20% range on net sales of sotatercept and luspatercept. The royalty schedules for sotatercept and luspatercept are the same. Accounting Analysis During the three months ended March 31, 2017 and 2016 , the Company recognized $0.1 million and $0.1 million , respectively, of the total deferred revenue as license and milestone revenue in the accompanying consolidated statements of operations and comprehensive loss. During February 2016, the Company achieved a $15.0 million clinical milestone under its Luspatercept Agreement, related to the initiation of a Phase 3 clinical trial with Luspatercept. The Company evaluated the milestone and determined that it was substantive and consistent with the definition of a milestone included in ASU 2010-17 and, accordingly, recognized the $15.0 million payment in revenue during the quarter ended March 31, 2016 . The remaining development milestones under the Luspatercept and Sotatercept Agreements were deemed to be substantive and consistent with the definition of a milestone included in ASU 2010-17 and, accordingly, the Company will recognize payments related to the achievement of such milestones, if any, when such milestone is achieved. As noted above, under the terms of the Luspatercept Agreement the Company retained responsibility for certain research and development activities. In November 2013, the Company agreed to conduct additional activities for the benefit of the luspatercept program including certain clinical and non-clinical services. These activities are reimbursed under the same terms and rates of the existing Agreements and are account for as the services are delivered. Pursuant to the terms of the agreement, Celgene and the Company shared development costs, with Celgene responsible for substantially more than half of the costs for sotatercept and luspatercept until December 31, 2012 and 100% of the costs from January 1, 2013 and thereafter. Payments from Celgene with respect to research and development costs incurred by the Company are recorded as cost-sharing revenue. The Company recorded net cost-sharing revenue of $3.6 million and $3.1 million during the three months ended March 31, 2017 and 2016 , respectively. Other Agreements Other In 2004, the Company entered into a license agreement with a non-profit institution for an exclusive, sublicensable, worldwide, royalty-bearing license to certain patents developed by the institution (Primary Licensed Products). In addition, the Company was granted a non-exclusive, non-sub-licensable license for Secondary Licensed Products. As compensation for the licenses, the Company issued 62,500 shares of its common stock to the institution, the fair value of which was $25,000 , and was expensed during 2004 to research and development expense. The Company also agreed to pay specified development milestone payments totaling up to $2.0 million for sotatercept and $0.7 million for luspatercept. In addition, the Company is obligated to pay milestone fees based on the Company’s research and development progress, and U.S. sublicensing revenue ranging from 10% - 25% , as well as a royalty ranging from 1.0% - 3.5% of net sales on any products under the licenses. During the three months ended March 31, 2017 and 2016 , the Company expensed zero and $0.9 million , respectively. In 2006, the Company entered into another license agreement with certain individuals for an exclusive, sublicensable, worldwide, royalty-bearing license to certain patents developed by the individuals. The Company agreed to pay specified development and sales milestone payments aggregating up to $1.0 million relating to the development and commercialization of dalantercept. In addition, the Company is required to pay royalties in the low single-digits on worldwide net product sales of dalantercept, with royalty obligations continuing at a 50% reduced rate for a period of time after patent expiration. If the Company sublicenses its patent rights, it will owe a percentage of sublicensing revenue, excluding payments based on the level of sales, profits or other levels of commercialization. During the three months ended March 31, 2017 and 2016 , the Company did no t reach any milestones defined under the agreement and, therefore, no amounts have been paid or expensed. During 2012, the Company executed a license agreement with a research institution for an exclusive, sublicensable, worldwide, royalty-bearing license. The Company is obligated to pay development milestones and commercial milestone fees relating to dalantercept totaling up to $1.0 million . The Company will also pay $25,000 annually upon first commercial sale as well as royalties of 1.5% of net sales on any products developed under the patents. During the three months ended March 31, 2017 and 2016 , the Company did no t reach any milestones defined under the agreement and, therefore, no amounts have been paid or expensed. In May 2014, the Company executed a collaboration agreement with a research technology company. The Company paid an upfront research fee of $0.3 million upon execution of the agreement. The Company also received an option to obtain a commercial license to the molecules developed during the collaboration. During the three months ended March 31, 2017 and 2016 , the Company expensed $0.1 million and $0.3 million , respectively, which is recorded as research and development expense. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation The Company recognized stock-based compensation expense related to stock options, restricted stock units and the 2013 Employee Stock Purchase Plan totaling $6.6 million and $4.2 million during the three months ended March 31, 2017 and 2016 , respectively. Total compensation cost recognized for all stock-based compensation awards in the consolidated statements of operations and comprehensive (loss) income is as follows (in thousands): Three Months Ended 2017 2016 Research and development $ 3,662 $ 1,824 General and administrative 2,921 2,424 $ 6,583 $ 4,248 On January 1, 2017, the Company adopted ASU 2016-09, which identifies areas for simplification involving several aspects of accounting for share-based payments, including income tax consequences, classification of awards as either equity or liabilities, an option to make a policy election to recognize gross share based compensation expense with actual forfeitures recognized as they occur as well as certain classification changes on the statement of cash flows. In connection with the adoption of this standard, the Company changed its accounting policy to record actual forfeitures as they occur, rather than estimating forfeitures by applying a forfeiture rate. The provisions of the standard related to the timing of when excess tax benefits are recognized, minimum statutory withholding requirements and forfeitures were adopted using a modified retrospective transition method. Accordingly, a cumulative adjustment of $0.1 million was booked to retained earnings for the impact of the forfeitures. The Company also recorded $21.5 million f or the excess tax benefit related to equity awards, which was offset by a $21.5 million increase to the valuation allowance. The provisions of the standard related to the recognition of the excess tax benefits in the income statement and classification in the statement of cash flows were adopted prospectively and prior periods were not retrospectively adjusted. In December 2016, the Company entered into a consulting agreement with the Company's former Chief Executive Officer. In accordance with the Company’s Plan and any vested stock options (options) remain outstanding and exercisable and unvested options and restricted stock units will continue to vest in accordance with their terms so long as he continues to provide services as a consultant. During the three months ended March 31, 2017 and 2016 , the Company recognized $1.1 million and zero of stock-based compensation expense within research and development expense related to the agreement. Stock Options The fair value of each stock option issued to employees was estimated at the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions: Three Months Ended 2017 2016 Expected volatility 65.9 % 64.4 % Expected term (in years) 6.0 5.9 Risk-free interest rate 2.2 % 1.4 % Expected dividend yield — % — % The following table summarizes the stock option activity under the Company’s 2003 Stock Option and Restricted Stock Plan and 2013 Equity Incentive Plan during the three months ended March 31, 2017 (in thousands, except per share amounts and years): Number of Grants Weighted- Average Exercise Price Per Share Weighted- Average Contractual Life (in years) Aggregate Intrinsic Value(1) Outstanding at December 31, 2016 3,316 $ 25.96 7.03 Granted 567 $ 30.00 Exercised (293 ) $ 3.93 Canceled or forfeited (7 ) $ 35.98 Outstanding at March 31, 2017 3,583 $ 28.38 7.63 $ 13,224,792 Exercisable at March 31, 2017 1,675 $ 23.39 6.01 $ 13,030,298 (1) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the estimated fair value of the common stock for the options that were in the money at March 31, 2017 . During the three months ended March 31, 2017 , the Company granted stock options to purchase an aggregate of 566,709 shares of its common stock, with a weighted-average grant date fair value of options granted of $18.16 . During the three months ended March 31, 2017 , current and former employees of the Company exercised a total of 292,537 options, resulting in total proceeds of $1.2 million . The aggregate intrinsic value of options exercised during the three months ended March 31, 2017 was $6.8 million . As of March 31, 2017 , there was $33.3 million of unrecognized compensation expense related to unvested stock options that is expected to be recognized over a weighted-average period of 2.87 years. Restricted Stock Units The following table summarizes the restricted stock unit (RSU) activity under the 2013 Equity Incentive Plan during the three months ended March 31, 2017 (in thousands, except per share amounts): Number Weighted- Unvested balance at December 31, 2016 732 $ 31.55 Granted 112 $ 29.48 Vested (35 ) $ 30.84 Forfeited (2 ) $ 36.87 Unvested balance at March 31, 2017 807 $ 31.28 During the three months ended March 31, 2017 , the Company issued 100,692 RSUs to employees. These RSUs are subject to time-based vesting. As of March 31, 2017 , there was approximately $6.6 million of unrecognized compensation cost related to the time-based RSUs, which the Company expects to recognize over a remaining weighted-average period of 2.12 years . 245,029 restricted stock units subject to time-based vesting remained unvested and outstanding at March 31, 2017 . During the three months ended March 31, 2017 , the Company issued 11,526 performance-based RSUs in addition to the 550,777 issued in 2015 and 2016. The vesting of these performance-based RSUs is accelerated upon the occurrence of certain milestone events, but otherwise these RSUs vest in September 2019. As a result, when a milestone becomes probable, compensation cost is recognized over the estimated period of achievement. If achievement is not considered probable, the expense is recognized over the vesting period. At March 31, 2017 , there was approximately $8.7 million of unrecognized compensation cost related to the performance-based RSUs, which the Company expects to recognize over a remaining weighted-average period of 1.57 years . All 562,303 of these performance-based RSUs remained outstanding at March 31, 2017 . Employee Stock Purchase Plan During the three months ended March 31, 2017 and 2016 , the Company recorded $0.1 million and $0.1 million , respectively, of stock-based compensation expense related to the 2013 Employee Stock Purchase Plan (ESPP). |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes For the three months ended March 31, 2017 , the Company recorded current income tax expense of $6 thousand related to state income taxes on its interest income. For the three months ended March 31, 2016 , the Company did not record a current or deferred income tax provision or benefit. The Company has evaluated the positive and negative evidence bearing upon the realizability of its deferred tax assets. Based on the Company’s history of operating losses, the Company has concluded that it is more likely than not that the benefit of its deferred tax assets will not be realized. Accordingly, the Company has provided a full valuation allowance for deferred tax assets as of March 31, 2017 and December 31, 2016 . The Company files income tax returns in the United States, and various state jurisdictions. The federal and state income tax returns are generally subject to tax examinations for the tax years ended December 31, 2013 through December 31, 2016 . 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 taxing authorities to the extent utilized in a future period. The Company accounts for uncertain tax positions in accordance with the provisions of ASC 740. When uncertain tax positions exist, the Company recognizes the tax benefit of tax positions to the extent that the benefit will more likely than not be realized. The determination as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position as well as consideration of the available facts and circumstances. As of March 31, 2017 and December 31, 2016 , the Company did not have any significant uncertain tax positions. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions Celgene Corporation In connection with prior arrangements, Celgene owned 12.6% and 12.8% of the Company’s fully diluted equity as of March 31, 2017 and December 31, 2016 , respectively. Refer to Note 15 for additional information regarding this collaboration arrangement. During the three months ended March 31, 2017 and 2016 , all revenue recognized by the Company was recognized under the Celgene collaboration arrangement and, as of March 31, 2017 , the Company had $4.1 million of deferred revenue related to the Celgene collaboration arrangement. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | The accompanying interim condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP). Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification (ASC) and Accounting Standards Update (ASU) of the Financial Accounting Standards Board (FASB). The accompanying interim condensed consolidated financial statements are unaudited. The unaudited interim financial statements have been prepared on the same basis as the audited annual financial statements as of and for the year ended December 31, 2016 , and, in the opinion of management, reflect all adjustments, consisting of normal recurring adjustments, necessary for the fair presentation of the Company’s financial position as of March 31, 2017 , and the results of its operations and its cash flows for the three months ended March 31, 2017 and 2016 . The results for the three months ended March 31, 2017 are not necessarily indicative of the results to be expected for the year ending December 31, 2017 , any other interim periods, or any future year or period. These interim financial statements should be read in conjunction with the audited financial statements as of and for the year ended December 31, 2016 , and the notes thereto, together with Management’s Discussion and Analysis of Financial Condition and Results of Operations, contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 . The accompanying interim condensed consolidated financial statements reflect the application of certain significant accounting policies as described below and elsewhere in these notes to the financial statements. As of March 31, 2017 , the Company’s significant accounting policies and estimates, which are detailed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 , have not changed, except for the adoption of Accounting Standards Update (ASU) No. 2016-09, Compensation - Stock Compensation (Topic 718), Improvements to Employee Share-Based Payment Accounting, which is discussed further in Note 16 . |
Use of Estimates | The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts expensed during the reporting period. Management considers many factors in selecting appropriate financial accounting policies and controls, and in developing the estimates and assumptions that are used in the preparation of these consolidated financial statements. Management must apply significant judgment in this process. In addition, other factors may affect estimates, including: expected business and operational changes, sensitivity and volatility associated with the assumptions used in developing estimates, and whether historical trends are expected to be representative of future trends. The estimation process often may yield a range of potentially reasonable estimates of the ultimate future outcomes and management must select an amount that falls within that range of reasonable estimates. This process may result in actual results differing materially from those estimated amounts used in the preparation of the consolidated financial statements if these results differ from historical experience, or other assumptions do not turn out to be substantially accurate, even if such assumptions are reasonable when made. In preparing these consolidated financial statements, management used significant estimates in the following areas, among others: revenue recognition, stock-based compensation expense, the determination of the fair value of stock-based awards, the fair value of liability-classified warrants, accrued expenses, and the recoverability of the Company’s net deferred tax assets and related valuation allowance. |
Recently Adopted Accounting Pronouncements | From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (FASB) or other standard setting bodies and adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on its financial position or results of operations upon adoption. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) , which supersedes all existing revenue recognition requirements, including most industry-specific guidance. The new standard requires a company to recognize revenue when it transfers goods or services to customers in an amount that reflects the consideration that the company expects to receive for those goods or services. The new standard will be effective for the Company on January 1, 2018. Topic 606 allows for either a full retrospective application, in which the standard is applied to all periods presented, or a modified retrospective application, in which the standard is applied to the most current period presented in the financial statements. As of March 31, 2017 , revenue is generated exclusively from the Company's collaboration agreement with Celgene. The Company is currently evaluating the potential impact that Topic 606 may have on its financial position and results of operations as it relates to this single arrangement, and expects to elect the modified retrospective application as its transition method. In February 2016 the FASB issued ASU 2016-02, Leases (Topic 842), Amendments to the FASB Accounting Standards Codification, which replaces the existing guidance for leases. ASU 2016-02 requires the identification of arrangements that should be accounted for as leases by lessees. In general, for lease arrangements exceeding a twelve month term, these arrangements must now be recognized as assets and liabilities on the balance sheet of the lessee. Under ASU 2016-02, a right-of-use asset and lease obligation will be recorded for all leases, whether operating or financing, while the income statement will reflect lease expense for operating leases and amortization/interest expense for financing leases. The balance sheet amount recorded for existing leases at the date of adoption of ASU 2016-02 must be calculated using the applicable incremental borrowing rate at the date of adoption. In addition, ASU 2016-02 requires the use of the modified retrospective method, which will require adjustment to all comparative periods presented in the consolidated financial statements. This guidance is effective for annual and interim periods beginning after December 15, 2018 and requires retrospective application. The Company is currently assessing the impact that adopting ASU 2016-02 will have on its consolidated financial statements and related disclosures. In June 2016 the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments . This new standard changes the impairment model for most financial assets and certain other instruments. Under the new standard, entities holding financial assets and net investment in leases that are not accounted for at fair value through net income to be presented at the net amount expected to be collected. An allowance for credit losses will be a valuation account that will be deducted from the amortized cost basis of the financial asset to present the net carrying value at the amount expected to be collected on the financial asset. This guidance is effective for annual and interim reporting periods beginning after December 15, 2019, with early adoption permitted. The adoption of this standard is not expected to have a material impact on the Company's financial position or results of operations. In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows - Restricted Cash (Topic 230) . This new standard requires companies to include amounts generally described as restricted cash and restricted cash equivalents in cash and cash equivalents when reconciling beginning-of-period and end-of-period total amounts shown on the statement of cash flows. This guidance is effective for annual and interim reporting periods beginning after December 15, 2017, and requires retrospective application. The Company is currently assessing the impact that adopting ASU 2016-18 will have on its consolidated financial statements and related disclosures. In December 2016, the FASB issued ASU 2016-19, Technical Corrections and Improvements . This new standard is intended to clarify guidance or correct references in the Accounting Standards Codification that could potentially result in changes in current practice because of either misapplication or misunderstanding of current guidance. The amendments of the standard that require transition guidance are effective for annual and interim reporting periods beginning after December 15, 2016, and early adoption is permitted. All other amendments were effective immediately. The Company adopted the standard effective January 1, 2017, and it did not have a material impact on the Company's financial position or results of operations. In March 2017, the FASB issued ASU 2017-08, Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities. This new standard shortens the amortization period for certain callable debt securities held at a premium. Specifically, the amendment requires the premium to be amortized to the earliest call date. The amendment does not require an accounting change for securities held at a discount; the discount continues to be amortized to maturity. The guidance is effective for annual and interim periods beginning after December 15, 2018, and early adoption is permitted. The amendment should be applied on a modified retrospective basis, with the cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. The Company is currently assessing the impact that adopting ASU 2017-08 will have on its consolidated financial statements and related disclosures. |
Cash Equivalents and Short-te25
Cash Equivalents and Short-term and Long-term Investments (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Cash and Cash Equivalents [Abstract] | |
Available-for-sale Securities | The following is a summary of cash, cash equivalents and available-for-sale securities as of March 31, 2017 and December 31, 2016 (in thousands): March 31, 2017 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Cash and cash equivalents due in 90 days or less $ 33,157 $ — $ — $ 33,157 Available-for-sale securities: Corporate obligations due in one year or less 44,328 — (74 ) 44,254 Corporate obligations due in more than one year 27,819 2 (113 ) 27,708 U.S. Treasury securities due in one year or less 17,494 — (14 ) 17,480 U.S. Treasury securities due in more than one year 11,536 — (52 ) 11,484 Certificates of deposit due in one year or less 9,665 — — 9,665 Certificates of deposit due in more than one year 6,665 — — 6,665 Mortgage and other asset backed securities due in one year or less 36,860 — (40 ) 36,820 Mortgage and other asset backed securities due in more than one year 26,090 — (109 ) 25,981 Total available-for-sale securities 180,457 2 (402 ) 180,057 Total cash, cash equivalents and available-for-sale securities $ 213,614 $ 2 $ (402 ) $ 213,214 December 31, 2016 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Cash and cash equivalents due in 90 days or less $ 20,950 $ — $ — $ 20,950 Available-for-sale securities: Corporate obligations due in one year or less 45,839 1 (58 ) $ 45,782 Corporate obligations due in more than one year 42,895 — (185 ) 42,710 U.S. Treasury securities due in one year or less 22,490 — (10 ) 22,480 U.S. Treasury securities due in more than one year 11,541 — (53 ) 11,488 Certificates of deposit due in one year or less 13,562 — — 13,562 Certificates of deposit due in more than one year 9,811 — — 9,811 Mortgage and other asset backed securities due in one year or less 36,948 — (32 ) 36,916 Mortgage and other asset backed securities due in more than one year 30,771 — (88 ) 30,683 Total available-for-sale securities 213,857 1 (426 ) 213,432 Total cash, cash equivalents and available-for-sale securities $ 234,807 $ 1 $ (426 ) $ 234,382 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of financial instruments carried at fair value | The following tables set forth the Company’s financial instruments carried at fair value using the lowest level of input applicable to each financial instrument as of March 31, 2017 and December 31, 2016 (in thousands): March 31, 2017 Quoted Prices in Active Markets for Identical Items (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Assets: Money market funds $ 31,820 $ — $ — $ 31,820 Corporate obligations — 71,962 — 71,962 U.S. Treasury securities — 28,963 — 28,963 Certificates of deposit — 16,330 — 16,330 Mortgage and other asset backed securities — 62,802 — 62,802 Restricted cash 1,132 — — 1,132 Total assets $ 32,952 $ 180,057 $ — $ 213,009 Liabilities: Warrants to purchase common stock $ 1,289 $ 1,289 Total liabilities $ — $ — $ 1,289 1,289 December 31, 2016 Quoted Prices in Active Markets for Identical Items (Level 1) Significant other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Assets: Money market funds $ 19,818 $ — $ — $ 19,818 Corporate obligations — 88,492 — 88,492 U.S. Treasury securities — 33,968 — 33,968 Certificates of deposit — 23,373 — 23,373 Mortgage and other asset backed securities — 67,599 — 67,599 Restricted cash 946 — — 946 Total assets $ 20,764 $ 213,432 $ — $ 234,196 Liabilities: Warrants to purchase common stock $ — $ — $ 1,244 $ 1,244 Total liabilities $ — $ — $ 1,244 $ 1,244 |
Summary of changes in the fair value of the preferred and common stock warrant liability | The following table sets forth a summary of changes in the fair value of the Company’s common stock warrant liabilities, which represent a recurring measurement that is classified within Level 3 of the fair value hierarchy, wherein fair value is estimated using significant unobservable inputs (in thousands): Three Months Ended March 31, 2017 2016 Beginning balance $ 1,244 $ 17,187 Change in fair value 45 (8,683 ) Ending balance $ 1,289 $ 8,504 |
Net (Loss) Income Per Share (Ta
Net (Loss) Income Per Share (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Weighted Average Number of Shares | A reconciliation of the number of shares used in the calculation of basic and diluted net (loss) income per share is as follows (in thousands): Three Months Ended 2017 2016 Weighted-average number of common shares used in calculating basic net (loss) income per common share 38,404 36,911 Weighted-average number of common shares issuable upon exercise of outstanding stock options, based on treasury stock method — 1,389 Weighted-average number of common shares issuable upon exercise of outstanding common stock warrants, based on treasury stock method — 318 Weighted-average number of common shares issuable under the employee stock purchase plan, based on treasury stock method — 3 Weighted-average number of common shares issuable upon vesting of outstanding restricted stock units — 45 Weighted-average number of common shares used in computing diluted net (loss) income per common share 38,404 38,666 |
Schedule of anti-dilutive common stock equivalents excluded from the calculation of diluted net loss per share | The following common stock equivalents were excluded from the calculation of diluted net (loss) income per share for the periods indicated because their inclusion would have had an anti-dilutive effect (in thousands): Three Months Ended 2017 2016 Outstanding stock options 3,583 1,458 Common stock warrants 63 — Shares issuable under employee stock purchase plan 15 1 Restricted stock units 807 34 4,468 1,493 |
Warrants (Tables)
Warrants (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Warrants and Rights Note Disclosure [Abstract] | |
Summary of the number of shares issuable upon exercise of outstanding warrants and the terms and accounting treatment for the outstanding warrants | Below is a summary of the number of shares issuable upon exercise of outstanding warrants and the terms and accounting treatment for the outstanding warrants (in thousands, except per share data): Warrants as of Weighted- Average Exercise Balance Sheet Classification March 31, 2017 December 31, 2016 Price Per Share Expiration March 31, 2017 December 31, 2016 Warrants to purchase common stock 61 61 $ 5.88 June 10, 2020 - July 9, 2020 Liability Liability Warrants to purchase common stock 3 4 7.40 December 31, 2017 Equity(1) (2) Equity(1) (2) All warrants 64 65 $ 5.94 (1) In March 2017, warrant holders exercised warrants to purchase 1,187 shares of Common Stock on a net basis, resulting in the issuance of 1,014 shares of Common Stock. (2) Warrants to purchase common stock were issued in connection with various debt financing transactions that were consummated in periods prior to December 31, 2012. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Compensation Costs Recognized | Total compensation cost recognized for all stock-based compensation awards in the consolidated statements of operations and comprehensive (loss) income is as follows (in thousands): Three Months Ended 2017 2016 Research and development $ 3,662 $ 1,824 General and administrative 2,921 2,424 $ 6,583 $ 4,248 |
Schedule of Weighted-Average Assumptions Used for Estimating Fair Value | The fair value of each stock option issued to employees was estimated at the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions: Three Months Ended 2017 2016 Expected volatility 65.9 % 64.4 % Expected term (in years) 6.0 5.9 Risk-free interest rate 2.2 % 1.4 % Expected dividend yield — % — % |
Summary of Stock Option Activity | The following table summarizes the stock option activity under the Company’s 2003 Stock Option and Restricted Stock Plan and 2013 Equity Incentive Plan during the three months ended March 31, 2017 (in thousands, except per share amounts and years): Number of Grants Weighted- Average Exercise Price Per Share Weighted- Average Contractual Life (in years) Aggregate Intrinsic Value(1) Outstanding at December 31, 2016 3,316 $ 25.96 7.03 Granted 567 $ 30.00 Exercised (293 ) $ 3.93 Canceled or forfeited (7 ) $ 35.98 Outstanding at March 31, 2017 3,583 $ 28.38 7.63 $ 13,224,792 Exercisable at March 31, 2017 1,675 $ 23.39 6.01 $ 13,030,298 (1) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the estimated fair value of the common stock for the options that were in the money at March 31, 2017 . |
Schedule of Nonvested Restricted Stock Units Activity | The following table summarizes the restricted stock unit (RSU) activity under the 2013 Equity Incentive Plan during the three months ended March 31, 2017 (in thousands, except per share amounts): Number Weighted- Unvested balance at December 31, 2016 732 $ 31.55 Granted 112 $ 29.48 Vested (35 ) $ 30.84 Forfeited (2 ) $ 36.87 Unvested balance at March 31, 2017 807 $ 31.28 |
Nature of Business (Details)
Nature of Business (Details) | 3 Months Ended |
Mar. 31, 2017protein_therapeutic | |
Nature of Business | |
Number of therapeutics candidates discovered | 4 |
Segment Information (Details)
Segment Information (Details) | 3 Months Ended |
Mar. 31, 2017segment | |
Segment Information | |
Number of operating segments | 1 |
Cash Equivalents and Short-te32
Cash Equivalents and Short-term and Long-term Investments - Narrative (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2016 | |
Cash and Cash Equivalents [Abstract] | ||
Unrealized loss position, less than twelve months, fair value | $ 159,200,000 | $ 172,200,000 |
Continuous unrealized loss position, twelve months or longer, fair value | 2,500,000 | |
Continuous unrealized loss position, fair value | $ (202) |
Cash Equivalents and Short-te33
Cash Equivalents and Short-term and Long-term Investments (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 | Mar. 31, 2016 | Dec. 31, 2015 |
Schedule of Available-for-sale Securities [Line Items] | ||||
Cash and cash equivalents due in 90 days or less | $ 33,157 | $ 20,950 | $ 63,681 | $ 27,783 |
Available-for-sale securities: | ||||
Amortized Cost | 180,457 | 213,857 | ||
Gross Unrealized Gains | 2 | 1 | ||
Gross Unrealized Losses | (402) | (426) | ||
Estimated Fair Value | 180,057 | 213,432 | ||
Total cash, cash equivalents and available-for-sale securities | ||||
Amortized Cost | 213,614 | 234,807 | ||
Gross Unrealized Gains | 2 | 1 | ||
Gross Unrealized Losses | (402) | (426) | ||
Estimated Fair Value | 213,214 | 234,382 | ||
Corporate obligations due in one year or less | ||||
Available-for-sale securities: | ||||
Amortized Cost | 44,328 | 45,839 | ||
Gross Unrealized Gains | 0 | 1 | ||
Gross Unrealized Losses | (74) | (58) | ||
Estimated Fair Value | 44,254 | 45,782 | ||
Corporate obligations due in more than one year | ||||
Available-for-sale securities: | ||||
Amortized Cost | 27,819 | 42,895 | ||
Gross Unrealized Gains | 2 | 0 | ||
Gross Unrealized Losses | (113) | (185) | ||
Estimated Fair Value | 27,708 | 42,710 | ||
U.S. Treasury securities due in one year or less | ||||
Available-for-sale securities: | ||||
Amortized Cost | 17,494 | 22,490 | ||
Gross Unrealized Gains | 0 | 0 | ||
Gross Unrealized Losses | (14) | (10) | ||
Estimated Fair Value | 17,480 | 22,480 | ||
U.S. Treasury securities due in more than one year | ||||
Available-for-sale securities: | ||||
Amortized Cost | 11,536 | 11,541 | ||
Gross Unrealized Gains | 0 | 0 | ||
Gross Unrealized Losses | (52) | (53) | ||
Estimated Fair Value | 11,484 | 11,488 | ||
Certificates of deposit due in one year or less | ||||
Available-for-sale securities: | ||||
Amortized Cost | 9,665 | 13,562 | ||
Gross Unrealized Gains | 0 | 0 | ||
Gross Unrealized Losses | 0 | 0 | ||
Estimated Fair Value | 9,665 | 13,562 | ||
Certificates of deposit due in more than one year | ||||
Available-for-sale securities: | ||||
Amortized Cost | 6,665 | 9,811 | ||
Gross Unrealized Gains | 0 | 0 | ||
Gross Unrealized Losses | 0 | 0 | ||
Estimated Fair Value | 6,665 | 9,811 | ||
Mortgage and other asset backed securities due in one year or less | ||||
Available-for-sale securities: | ||||
Amortized Cost | 36,860 | 36,948 | ||
Gross Unrealized Gains | 0 | 0 | ||
Gross Unrealized Losses | (40) | (32) | ||
Estimated Fair Value | 36,820 | 36,916 | ||
Mortgage and other asset backed securities due in more than one year | ||||
Available-for-sale securities: | ||||
Amortized Cost | 26,090 | 30,771 | ||
Gross Unrealized Gains | 0 | 0 | ||
Gross Unrealized Losses | (109) | (88) | ||
Estimated Fair Value | $ 25,981 | $ 30,683 |
Restricted Cash (Details)
Restricted Cash (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Certificates of Deposits and Money Market Funds | Letter of Credit | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Letters of credit held in the form of a money market account as collateral for lease obligations and credit cards | $ 1.1 | $ 0.9 |
Fair Value Measurements Financi
Fair Value Measurements Financial Instrument at Fair Value Schedule (Details) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2017 | Dec. 31, 2016 | |
Liabilities: | ||
Fair value measurement transfers between levels | $ 0 | $ 0 |
Recurring | ||
Assets: | ||
Total assets | 213,009,000 | 234,196,000 |
Liabilities: | ||
Total liabilities | 1,289,000 | 1,244,000 |
Recurring | Common stock warrants | ||
Liabilities: | ||
Total liabilities | 1,289,000 | 1,244,000 |
Recurring | Money market funds | ||
Assets: | ||
Total assets | 31,820,000 | 19,818,000 |
Recurring | Corporate obligations | ||
Assets: | ||
Total assets | 71,962,000 | 88,492,000 |
Recurring | U.S. Treasury securities | ||
Assets: | ||
Total assets | 28,963,000 | 33,968,000 |
Recurring | Certificates of deposit | ||
Assets: | ||
Total assets | 16,330,000 | 23,373,000 |
Recurring | Mortgage and other asset backed securities | ||
Assets: | ||
Total assets | 62,802,000 | 67,599,000 |
Recurring | Restricted cash | ||
Assets: | ||
Total assets | 1,132,000 | 946,000 |
Recurring | Quoted Prices in Active Markets for Identical Items (Level 1) | ||
Assets: | ||
Total assets | 32,952,000 | 20,764,000 |
Liabilities: | ||
Total liabilities | 0 | 0 |
Recurring | Quoted Prices in Active Markets for Identical Items (Level 1) | Common stock warrants | ||
Liabilities: | ||
Total liabilities | 0 | |
Recurring | Quoted Prices in Active Markets for Identical Items (Level 1) | Money market funds | ||
Assets: | ||
Total assets | 31,820,000 | 19,818,000 |
Recurring | Quoted Prices in Active Markets for Identical Items (Level 1) | Corporate obligations | ||
Assets: | ||
Total assets | 0 | 0 |
Recurring | Quoted Prices in Active Markets for Identical Items (Level 1) | U.S. Treasury securities | ||
Assets: | ||
Total assets | 0 | 0 |
Recurring | Quoted Prices in Active Markets for Identical Items (Level 1) | Certificates of deposit | ||
Assets: | ||
Total assets | 0 | 0 |
Recurring | Quoted Prices in Active Markets for Identical Items (Level 1) | Mortgage and other asset backed securities | ||
Assets: | ||
Total assets | 0 | 0 |
Recurring | Quoted Prices in Active Markets for Identical Items (Level 1) | Restricted cash | ||
Assets: | ||
Total assets | 1,132,000 | 946,000 |
Recurring | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Total assets | 180,057,000 | 213,432,000 |
Liabilities: | ||
Total liabilities | 0 | 0 |
Recurring | Significant Other Observable Inputs (Level 2) | Common stock warrants | ||
Liabilities: | ||
Total liabilities | 0 | |
Recurring | Significant Other Observable Inputs (Level 2) | Money market funds | ||
Assets: | ||
Total assets | 0 | 0 |
Recurring | Significant Other Observable Inputs (Level 2) | Corporate obligations | ||
Assets: | ||
Total assets | 71,962,000 | 88,492,000 |
Recurring | Significant Other Observable Inputs (Level 2) | U.S. Treasury securities | ||
Assets: | ||
Total assets | 28,963,000 | 33,968,000 |
Recurring | Significant Other Observable Inputs (Level 2) | Certificates of deposit | ||
Assets: | ||
Total assets | 16,330,000 | 23,373,000 |
Recurring | Significant Other Observable Inputs (Level 2) | Mortgage and other asset backed securities | ||
Assets: | ||
Total assets | 62,802,000 | 67,599,000 |
Recurring | Significant Other Observable Inputs (Level 2) | Restricted cash | ||
Assets: | ||
Total assets | 0 | 0 |
Recurring | Significant Unobservable Inputs (Level 3) | ||
Assets: | ||
Total assets | 0 | 0 |
Liabilities: | ||
Total liabilities | 1,289,000 | 1,244,000 |
Recurring | Significant Unobservable Inputs (Level 3) | Common stock warrants | ||
Liabilities: | ||
Total liabilities | 1,289,000 | 1,244,000 |
Recurring | Significant Unobservable Inputs (Level 3) | Money market funds | ||
Assets: | ||
Total assets | 0 | 0 |
Recurring | Significant Unobservable Inputs (Level 3) | Corporate obligations | ||
Assets: | ||
Total assets | 0 | 0 |
Recurring | Significant Unobservable Inputs (Level 3) | U.S. Treasury securities | ||
Assets: | ||
Total assets | 0 | 0 |
Recurring | Significant Unobservable Inputs (Level 3) | Certificates of deposit | ||
Assets: | ||
Total assets | 0 | 0 |
Recurring | Significant Unobservable Inputs (Level 3) | Mortgage and other asset backed securities | ||
Assets: | ||
Total assets | 0 | 0 |
Recurring | Significant Unobservable Inputs (Level 3) | Restricted cash | ||
Assets: | ||
Total assets | $ 0 | $ 0 |
Fair Value Measurements Preferr
Fair Value Measurements Preferred and Common Stock Warrant Liability Rollforward (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Summary of changes in the fair value of the preferred and common stock warrant liability classified within Level 3 of the fair value hierarchy | ||
Beginning balance | $ 1,244 | $ 17,187 |
Change in fair value | 45 | (8,683) |
Ending balance | $ 1,289 | $ 8,504 |
Net (Loss) Income Per Share - R
Net (Loss) Income Per Share - Reconciliation of Number of Shares of Basic and Diluted Net (Loss) Income Per Share (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Weighted-average number of common shares used in calculating basic net (loss) income per common share (in shares) | 38,404 | 36,911 |
Weighted-average number of common shares issuable upon vesting of outstanding restricted stock units (in shares) | 0 | 45 |
Weighted-average number of common shares used in computing diluted net (loss) income per common share (in shares) | 38,404 | 38,666 |
Outstanding stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Weighted average number of shares, treasury stock (in shares) | 0 | 1,389 |
Common stock warrants | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Weighted average number of shares, treasury stock (in shares) | 0 | 318 |
Shares issuable under employee stock purchase plan | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Weighted average number of shares, treasury stock (in shares) | 0 | 3 |
Net (Loss) Income Per Share (De
Net (Loss) Income Per Share (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Net Income (Loss) Per Share | ||
Anti-dilutive common stock equivalents excluded from the calculation of diluted net loss per share (in shares) | 4,468 | 1,493 |
Outstanding stock options | ||
Net Income (Loss) Per Share | ||
Anti-dilutive common stock equivalents excluded from the calculation of diluted net loss per share (in shares) | 3,583 | 1,458 |
Common stock warrants | ||
Net Income (Loss) Per Share | ||
Anti-dilutive common stock equivalents excluded from the calculation of diluted net loss per share (in shares) | 63 | 0 |
Shares issuable under employee stock purchase plan | ||
Net Income (Loss) Per Share | ||
Anti-dilutive common stock equivalents excluded from the calculation of diluted net loss per share (in shares) | 15 | 1 |
Restricted stock units | ||
Net Income (Loss) Per Share | ||
Anti-dilutive common stock equivalents excluded from the calculation of diluted net loss per share (in shares) | 807 | 34 |
Warrants (Details)
Warrants (Details) - USD ($) $ / shares in Units, $ in Thousands | Jul. 31, 2010 | Mar. 31, 2017 | Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Warrants | ||||||
Number of shares issuable upon exercise of outstanding warrants (in shares) | 64,000 | 64,000 | 65,000 | |||
Weighted-average exercise price per share (in dollars per share) | $ 5.94 | $ 5.94 | ||||
Class of warrant or right number of warrants exercised on net basis | 1,187 | |||||
Stock issued during period shares warrants exercise on net basis | 1,014 | |||||
Change in fair value | $ 45 | $ (8,683) | ||||
Warrants to purchase Common stock expiring between June 10, 2020 to July 9, 2020 | ||||||
Warrants | ||||||
Number of shares issuable upon exercise of outstanding warrants (in shares) | 61,000 | 61,000 | 61,000 | |||
Weighted-average exercise price per share (in dollars per share) | $ 5.88 | $ 5.88 | ||||
Warrants to purchase Common stock expiring between June 10, 2020 to July 9, 2020 | Warrants issued in connection with financing transactions | ||||||
Warrants | ||||||
Number of shares issuable upon exercise of outstanding warrants (in shares) | 871,580 | |||||
Expiration period | 10 years | |||||
Warrants to Purchase Common Stock Having Expiration 31 December 2017 | ||||||
Warrants | ||||||
Number of shares issuable upon exercise of outstanding warrants (in shares) | [1],[2] | 3,000 | 3,000 | 4,000 | ||
Weighted-average exercise price per share (in dollars per share) | [1],[2] | $ 7.40 | $ 7.40 | |||
[1] | In March 2017, warrant holders exercised warrants to purchase 1,187 shares of Common Stock on a net basis, resulting in the issuance of 1,014 shares of Common Stock. | |||||
[2] | Warrants to purchase common stock were issued in connection with various debt financing transactions that were consummated in periods prior to December 31, 2012. |
Significant Agreements - Celgen
Significant Agreements - Celgene (Details) $ in Thousands | Feb. 20, 2008discovery_stage_compound | Mar. 31, 2017USD ($) | Mar. 31, 2016USD ($) |
Significant Agreements | |||
Cost-sharing, net | $ 3,570 | $ 3,057 | |
Collaboration, License, and Option Agreement | Luspatercept | |||
Significant Agreements | |||
Milestone, revenue recognized | 15,000 | ||
Investor | Collaboration, License, and Option Agreement | |||
Significant Agreements | |||
Deferred revenue recognized | 100 | 100 | |
Cost-sharing, net | 3,600 | $ 3,100 | |
Investor | Collaboration, License, and Option Agreement | Sotarcept | |||
Significant Agreements | |||
Number of license options granted | discovery_stage_compound | 3 | ||
Payments received | 43,900 | ||
Investor | Collaboration, License, and Option Agreement | Luspatercept | |||
Significant Agreements | |||
Payments received | $ 90,300 | ||
Investor | Collaboration, License, and Option Agreement | Sotarcept and Luspatercept | |||
Significant Agreements | |||
Percentage of development costs for which collaborator is responsible | 100.00% | ||
Investor | Collaboration, License, and Option Agreement | Weighted Average | Sotarcept and Luspatercept | |||
Significant Agreements | |||
Potential royalty rate (as a percent) | 20.00% | ||
Investor | Collaboration, License, and Option Agreement | Clinical milestones | Sotarcept | |||
Significant Agreements | |||
Milestone payment receivable on commencement of Phase 2b clinical trial | $ 10,000 | ||
Investor | Collaboration, License, and Option Agreement | Clinical milestones | Luspatercept | |||
Significant Agreements | |||
Milestone payment receivable on commencement of Phase 2b clinical trial | $ 25,000 |
Significant Agreements - Other
Significant Agreements - Other Agreements (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||
May 31, 2014 | Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2012 | Dec. 31, 2004 | |
Significant Agreements | |||||
Milestones and fees | $ 21,727,000 | $ 16,246,000 | |||
License agreement with research institution | |||||
Significant Agreements | |||||
Collaborative arrangement amount paid and expensed | 0 | 0 | |||
License Agreement | Common Stock | License agreement with a non-profit institution | |||||
Significant Agreements | |||||
Number of shares issued as compensation for licenses (in shares) | 62,500 | ||||
Fair value of shares issued as compensation for licenses | $ 25,000 | ||||
License Agreement | Minimum | License agreement with a non-profit institution | |||||
Significant Agreements | |||||
Milestone fees payable as percentage of research and U.S. development progress and sublicensing revenue | 10.00% | ||||
Royalty payable as percentage of net sales | 1.00% | ||||
License Agreement | Maximum | License agreement with a non-profit institution | |||||
Significant Agreements | |||||
Milestone fees payable as percentage of research and U.S. development progress and sublicensing revenue | 25.00% | ||||
Royalty payable as percentage of net sales | 3.50% | ||||
License Agreement | Dalantercept | License agreement with certain individuals | |||||
Significant Agreements | |||||
Percentage of reduction in royalty rate for a period of time after patent expiration | 50.00% | ||||
Collaborative arrangement amount paid and expensed | 0 | 0 | |||
License Agreement | Dalantercept | License agreement with research institution | |||||
Significant Agreements | |||||
Royalty payable as percentage of net sales | 1.50% | ||||
Annual payment upon first commercial sale | $ 25,000 | ||||
License Agreement | Development milestone | Sotarcept | Maximum | License agreement with a non-profit institution | |||||
Significant Agreements | |||||
Total potential milestone payments | $ 2,000,000 | ||||
License Agreement | Development milestone | Luspatercept | Maximum | License agreement with a non-profit institution | |||||
Significant Agreements | |||||
Total potential milestone payments | 700,000 | ||||
License Agreement | Development and sales milestone | Dalantercept | Maximum | License agreement with certain individuals | |||||
Significant Agreements | |||||
Total potential milestone payments | $ 1,000,000 | ||||
License Agreement | Development and commercial milestone | Dalantercept | Maximum | License agreement with research institution | |||||
Significant Agreements | |||||
Total potential milestone payments | $ 1,000,000 | ||||
Collaborative Arrangement | License agreement with antibody technology company | |||||
Significant Agreements | |||||
Milestones and fees | $ 300,000 | 0 | 900,000 | ||
Non-collaborative Arrangement Transactions | License Agreement with Non Profit Institution | |||||
Significant Agreements | |||||
Milestones and fees | $ 100,000 | $ 300,000 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award | ||
Stock-based compensation expense | $ 6,583,000 | $ 4,248,000 |
Share-based compensation, excess tax benefit, amount | 21,500,000 | |
2016 Consulting Agreement with Former CEO | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
Stock-based compensation expense | 1,100,000 | 0 |
Employee Stock Purchase Plan 2013 | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
Stock-based compensation expense | 100,000 | $ 100,000 |
Accounting Standards Update 2016-09 | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
Valuation allowance increase | 21,500,000 | |
Accounting Standards Update 2016-09 | Retained Earnings | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
Cumulative effect of new accounting principle in period of adoption | $ 100,000 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Stock-Based Compensation Costs Recognized (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost | ||
Stock-based compensation expense | $ 6,583 | $ 4,248 |
Research and Development | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost | ||
Stock-based compensation expense | 3,662 | 1,824 |
General and Administrative | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost | ||
Stock-based compensation expense | $ 2,921 | $ 2,424 |
Stock-Based Compensation - Sc44
Stock-Based Compensation - Schedule of Weighted-Average Assumptions Used for Estimating Fair Value (Details) - Stock Option | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award | ||
Expected volatility | 65.90% | 64.40% |
Expected term (in years) | 6 years | 5 years 10 months 24 days |
Risk-free interest rate | 2.20% | 1.40% |
Expected dividend yield | 0.00% | 0.00% |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2016 | ||
Number of Grants | |||
Granted (in shares) | 566,709 | ||
Exercised (in shares) | (292,537) | ||
Aggregate Intrinsic Value | |||
Weighted average grant date fair value (in usd per share) | $ 18.16 | ||
Total proceeds from options exercised | $ 1,200 | ||
Aggregate intrinsic value of options exercised | $ 6,800 | ||
Stock Option | |||
Number of Grants | |||
Outstanding at the beginning of period (in shares) | 3,316,498 | ||
Granted (in shares) | 566,709 | ||
Exercised (in shares) | (292,537) | ||
Canceled or forfeited (in shares) | (7,438) | ||
Outstanding at the end of the period (in shares) | 3,583,232 | 3,316,498 | |
Exercisable at the end of the period (in shares) | 1,674,848 | ||
Weighted- Average Exercise Price Per Share | |||
Outstanding at the beginning of period (in usd per share) | $ 25.96 | ||
Granted (in usd per share) | 30 | ||
Exercised (in usd per share) | 3.93 | ||
Canceled or forfeited (in usd per share) | 35.98 | ||
Outstanding at the end of the period (in usd per share) | 28.38 | $ 25.96 | |
Exercisable at the end of the period (in usd per share) | $ 23.39 | ||
Weighted- Average Contractual Life | |||
Outstanding at the beginning of the period (in years) | 7 years 7 months 17 days | 7 years 11 days | |
Outstanding at the end of the period (in years) | 7 years 7 months 17 days | 7 years 11 days | |
Exercisable at the end of the period (in years) | 6 years 4 days | ||
Aggregate Intrinsic Value | |||
Outstanding at the end of the period (in usd) | [1] | $ 13,224,792 | |
Exercisable at the end of the period (in usd) | [1] | 13,030,298 | |
Unrecognized compensation expense | $ 33,300 | ||
Weighted-average period for recognition (in years) | 2 years 10 months 13 days | ||
[1] | The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the estimated fair value of the common stock for the options that were in the money at March 31, 2017. |
Stock-Based Compensation - Sc46
Stock-Based Compensation - Schedule of Nonvested Restricted Stock Activity (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 24 Months Ended |
Mar. 31, 2017 | Dec. 31, 2016 | |
Restricted stock units | ||
Number of Grants | ||
Unvested balance at beginning of the period (in shares) | 732,000 | |
Granted (in shares) | 112,000 | |
Vested (in shares) | (35,000) | |
Forfeited (in shares) | (2,000) | |
Unvested balance at end of the period (in shares) | 807,000 | 732,000 |
Weighted- Average Grant Date Fair Value | ||
Unvested balance at beginning of the period (in usd per share) | $ 31.55 | |
Granted (in usd per share) | 29.48 | |
Vested (in usd per share) | 30.84 | |
Forfeited (in usd per share) | 36.87 | |
Unvested balance at end of the period (in usd per share) | $ 31.28 | $ 31.55 |
Certain Individuals | Restricted stock units | ||
Number of Grants | ||
Granted (in shares) | 100,692 | |
Unvested balance at end of the period (in shares) | 245,029 | |
Weighted- Average Grant Date Fair Value | ||
Unrecognized compensation cost | $ 6.6 | |
Weighted-average period for recognition (in years) | 2 years 1 month 13 days | |
Certain Individuals | Performance-Based Restricted Stock Units | ||
Number of Grants | ||
Granted (in shares) | 11,526 | 550,777 |
Unvested balance at end of the period (in shares) | 562,303 | |
Weighted- Average Grant Date Fair Value | ||
Unrecognized compensation cost | $ 8.7 | |
Weighted-average period for recognition (in years) | 1 year 6 months 26 days |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Income Tax Disclosure [Abstract] | ||
Income tax expense | $ 6 | $ 0 |
Related Party Transactions (Det
Related Party Transactions (Details) - Celgene - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Related Party Transactions | ||
Ownership percentage of entity's fully diluted equity | 12.60% | 12.80% |
Deferred revenue | $ 4.1 |