Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Feb. 20, 2017 | Jun. 30, 2016 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | BLUE | ||
Entity Registrant Name | bluebird bio, Inc. | ||
Entity Central Index Key | 1,293,971 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 40,844,757 | ||
Entity Public Float | $ 1,586,834,900 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 278,887 | $ 164,269 |
Marketable securities | 425,491 | 353,680 |
Prepaid expenses and other current assets | 19,836 | 6,016 |
Total current assets | 724,214 | 523,965 |
Marketable securities | 180,452 | 347,814 |
Property and equipment, net | 156,955 | 82,614 |
Intangible assets, net | 20,694 | 24,456 |
Goodwill | 13,128 | 13,128 |
Restricted cash and other non-current assets | 22,679 | 10,360 |
Total assets | 1,118,122 | 1,002,337 |
Current liabilities: | ||
Accounts payable | 13,664 | 6,334 |
Accrued expenses and other current liabilities | 54,660 | 28,145 |
Deferred revenue, current portion | 6,209 | 5,889 |
Total current liabilities | 74,533 | 40,368 |
Deferred rent, net of current portion | 10,408 | 8,294 |
Deferred revenue, net of current portion | 40,204 | 35,959 |
Contingent consideration, net of current portion | 3,277 | 5,082 |
Construction financing lease obligation | 120,140 | 61,901 |
Other non-current liabilities | 120 | 237 |
Total liabilities | 248,682 | 151,841 |
Commitments and contingencies (Note 8) | ||
Stockholders' equity: | ||
Preferred stock, $0.01 par value, 5,000 shares authorized; 0 shares issued and outstanding at December 31, 2016 and December 31, 2015 | ||
Common stock, $0.01 par value, 125,000 shares authorized; 40,691 and 36,894 shares issued and outstanding at December 31, 2016 and December 31, 2015, respectively | 407 | 369 |
Additional paid-in capital | 1,447,856 | 1,166,585 |
Accumulated other comprehensive loss | (1,149) | (2,291) |
Accumulated deficit | (577,674) | (314,167) |
Total stockholders' equity | 869,440 | 850,496 |
Total liabilities and stockholders' equity | $ 1,118,122 | $ 1,002,337 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 |
Statement Of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 125,000,000 | 125,000,000 |
Common stock, shares issued | 40,691,000 | 36,894,000 |
Common stock, shares outstanding | 40,691,000 | 36,894,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Revenue: | |||
Collaboration revenue | $ 6,155 | $ 14,079 | $ 25,031 |
Research and license fees | 390 | ||
Total revenue | 6,155 | 14,079 | 25,421 |
Operating expenses: | |||
Research and development | 204,775 | 134,038 | 62,574 |
General and administrative | 65,119 | 46,209 | 23,227 |
Change in fair value of contingent consideration | 4,091 | 2,869 | 246 |
Total operating expenses | 273,985 | 183,116 | 86,047 |
Loss from operations | (267,830) | (169,037) | (60,626) |
Other income, net | 3,711 | 2,314 | 120 |
Loss before income taxes | (264,119) | (166,723) | (60,506) |
Income tax benefit (expense) | 612 | (60) | 11,797 |
Net loss | $ (263,507) | $ (166,783) | $ (48,709) |
Net loss per share - basic and diluted | $ (7.07) | $ (4.81) | $ (1.83) |
Weighted-average number of common shares used in computing net loss per share - basic and diluted | 37,284 | 34,669 | 26,546 |
Other comprehensive income (loss): | |||
Unrealized gain (loss) on available-for-sale securities, net of tax expense of $0.6 and $0.0 million for the years ended December 31, 2016 and 2015, respectively | $ 1,142 | $ (2,220) | $ (71) |
Total other comprehensive income (loss) | 1,142 | (2,220) | (71) |
Comprehensive loss | $ (262,365) | $ (169,003) | $ (48,780) |
Consolidated Statements of Ope5
Consolidated Statements of Operations and Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Statement [Abstract] | ||
Unrealized gain (loss) on available-for-sale securities tax expense | $ 0.6 | $ 0 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock [Member] | Common Stock [Member]Pregenen [Member] | Additional Paid-in Capital [Member] | Additional Paid-in Capital [Member]Pregenen [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Accumulated Deficit [Member] |
Beginning balance at Dec. 31, 2013 | $ 151,667 | $ 239 | $ 250,103 | $ (98,675) | |||
Beginning balance, shares at Dec. 31, 2013 | 23,940 | ||||||
Vesting of restricted stock issued in exchange for nonrecourse note | $ 1 | (1) | |||||
Vesting of restricted stock issued in exchange for nonrecourse note (in shares) | 69 | ||||||
Issuance of common stock upon public offering, net of issuance costs | 353,042 | $ 65 | 352,977 | ||||
Issuance of common stock upon public offering, net of issuance costs, shares | 6,498 | ||||||
Issuance of common stock in connection with acquisition | 19,474 | $ 4 | 19,470 | ||||
Issuance of common stock in connection with acquisition, shares | 411 | ||||||
Exercise of common stock warrants | $ 1 | (1) | |||||
Exercise of common stock warrants, shares | 114 | ||||||
Exercise of stock options | 5,049 | $ 13 | 5,036 | ||||
Exercise of stock options, shares | 1,306 | ||||||
Issuance of common stock in exchange for consulting services to non-employees | 42 | 42 | |||||
Issuance of common stock in exchange for consulting services, shares | 2 | ||||||
Stock-based compensation | 10,763 | 10,763 | |||||
Unrealized gain (loss) on available-for-sale securities, net of tax | (71) | $ (71) | |||||
Net loss | (48,709) | (48,709) | |||||
Ending balance at Dec. 31, 2014 | 491,257 | $ 323 | 638,389 | (71) | (147,384) | ||
Ending balance, shares at Dec. 31, 2014 | 32,340 | ||||||
Vesting of restricted stock units | $ 1 | (1) | |||||
Vesting of restricted stock units, shares | 62 | ||||||
Issuance of common stock upon public offering, net of issuance costs | 477,247 | $ 29 | 477,218 | ||||
Issuance of common stock upon public offering, net of issuance costs, shares | 2,941 | ||||||
Issuance of common stock in connection with acquisition | $ 1 | $ (1) | |||||
Issuance of common stock in connection with acquisition, shares | 94 | ||||||
Exercise of common stock warrants | $ 2 | (2) | |||||
Exercise of common stock warrants, shares | 164 | ||||||
Exercise of stock options | 9,383 | $ 13 | 9,370 | ||||
Exercise of stock options, shares | 1,282 | ||||||
Purchase of common stock under ESPP | 492 | 492 | |||||
Purchase of common stock under ESPP, shares | 11 | ||||||
Stock-based compensation | 41,120 | 41,120 | |||||
Unrealized gain (loss) on available-for-sale securities, net of tax | (2,220) | (2,220) | |||||
Net loss | (166,783) | (166,783) | |||||
Ending balance at Dec. 31, 2015 | $ 850,496 | $ 369 | 1,166,585 | (2,291) | (314,167) | ||
Ending balance, shares at Dec. 31, 2015 | 36,894 | 36,894 | |||||
Vesting of restricted stock units | $ 1 | (1) | |||||
Vesting of restricted stock units, shares | 113 | ||||||
Issuance of common stock upon public offering, net of issuance costs | $ 234,731 | $ 33 | 234,698 | ||||
Issuance of common stock upon public offering, net of issuance costs, shares | 3,289 | ||||||
Exercise of stock options | $ 6,145 | $ 4 | 6,141 | ||||
Exercise of stock options, shares | 377 | 377 | |||||
Purchase of common stock under ESPP | $ 677 | 677 | |||||
Purchase of common stock under ESPP, shares | 18 | ||||||
Stock-based compensation | 39,756 | 39,756 | |||||
Unrealized gain (loss) on available-for-sale securities, net of tax | 1,142 | 1,142 | |||||
Net loss | (263,507) | (263,507) | |||||
Ending balance at Dec. 31, 2016 | $ 869,440 | $ 407 | $ 1,447,856 | $ (1,149) | $ (577,674) | ||
Ending balance, shares at Dec. 31, 2016 | 40,691 | 40,691 |
Consolidated Statements of Sto7
Consolidated Statements of Stockholders' Equity (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Statement Of Stockholders Equity [Abstract] | |||
Costs from IPO | $ 15,269 | $ 22,753 | $ 23,295 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Operating activities | |||
Net loss | $ (263,507) | $ (166,783) | $ (48,709) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | |||
Change in fair value of contingent consideration | 2,675 | 2,344 | 246 |
Depreciation and amortization | 9,648 | 7,419 | 4,228 |
Stock-based compensation expense | 39,756 | 41,120 | 10,763 |
Issuance of restricted common stock in exchange for consulting services to non-employees | 168 | ||
Noncash benefit on release of tax valuation allowance | (11,797) | ||
Other non-cash items | 2,825 | 1,513 | 142 |
Changes in operating assets and liabilities: | |||
Prepaid expenses and other current assets | (14,318) | (6,847) | 307 |
Accounts payable | 6,658 | 2,541 | (2,249) |
Accrued expenses and other liabilities | 20,889 | 9,423 | 9,969 |
Deferred revenue | 4,565 | 11,171 | (24,871) |
Deferred rent | 1,162 | (330) | 2,110 |
Net cash used in operating activities | (189,647) | (98,429) | (59,693) |
Investing activities | |||
Restricted cash | (4,379) | (8,816) | 209 |
Purchase of property and equipment | (15,995) | (7,055) | (8,708) |
Payments made for tenant improvements for capital lease | (12,034) | ||
Purchases of marketable securities | (348,225) | (755,175) | (174,981) |
Proceeds from maturities of marketable securities | 443,364 | 199,179 | 30,960 |
Acquisition of business, net of cash acquired | (4,673) | ||
Net cash provided by (used in) investing activities | 62,731 | (571,867) | (157,193) |
Financing activities | |||
Cash paid for contingent purchase price consideration | (2,025) | (453) | |
Reimbursement of tenant improvements for capital lease | 1,663 | ||
Proceeds from public offering of common stock, net of issuance costs | 234,962 | 477,064 | 353,226 |
Proceeds from issuance of common stock | 6,934 | 10,109 | 5,226 |
Net cash provided by financing activities | 241,534 | 486,720 | 358,452 |
Increase (decrease) in cash and cash equivalents | 114,618 | (183,576) | 141,566 |
Cash and cash equivalents at beginning of period | 164,269 | 347,845 | 206,279 |
Cash and cash equivalents at end of period | 278,887 | 164,269 | 347,845 |
Non-cash investing and financing activities: | |||
Construction financing lease obligation | 48,034 | 61,901 | |
Purchases of property and equipment included in accounts payable and accrued expenses | 6,363 | $ 2,089 | 387 |
Tenant improvements under capital lease included in prepaid expenses and other assets | 8,542 | ||
Offering expenses included in accounts payable and accrued expenses | $ 231 | $ 183 |
Description of the business
Description of the business | 12 Months Ended |
Dec. 31, 2016 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Description of the business | 1. Description of the business bluebird bio, Inc. (the “Company” or “bluebird”) was incorporated in Delaware on April 16, 1992, and is headquartered in Cambridge, Massachusetts. The Company researches, develops, manufactures and plans to commercialize gene therapies for severe genetic diseases and cancer. Since its inception, the Company has devoted substantially all of its resources to its research and development efforts relating to its product candidates, including activities to manufacture product candidates, conduct clinical studies of its product candidates, perform preclinical research to identify new product candidates and provide general and administrative support for these operations. On June 30, 2014, the Company acquired all of the outstanding capital stock of Precision Genome Engineering, Inc. (“Pregenen”) and in connection therewith, obtained the rights to Pregenen’s gene editing and cell signaling technology. In July 2014, the Company sold 3,450,000 shares of common stock (inclusive of 450,000 shares of common stock sold by the Company pursuant to the full exercise of an overallotment option granted to the underwriters in connection with the offering) through an underwritten public offering at a price of $34.00 per share for aggregate net proceeds of $109.8 million. In December 2014, the Company sold 3,047,500 shares of common stock (inclusive of 397,500 shares of common stock sold by the Company pursuant to the full exercise of an overallotment option granted to the underwriters in connection with the offering) through an underwritten public offering at a price of $85.00 per share for aggregate net proceeds of $243.3 million. In June 2015, the Company sold 2,941,176, shares of common stock through an underwritten public offering at a price of $170.00 per share for aggregate net proceeds of $477.2 million. In December 2016, the Company sold 3,289,473 shares of common stock through an underwritten public offering at a price of $76.00 per share for aggregate net proceeds of $234.7 million. As of December 31, 2016, the Company had cash, cash equivalents and marketable securities of $884.8 million. Although the Company has incurred recurring losses and expects to continue to incur losses for the foreseeable future, the Company expects its cash, cash equivalents and marketable securities will be sufficient to fund current operations for at least the next twelve months. |
Summary of significant accounti
Summary of significant accounting policies and basis of presentation | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Summary of significant accounting policies and basis of presentation | 2. Summary of significant accounting policies and basis of presentation Basis of presentation and principles of consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries: Precision Genome Engineering, Inc., bluebird bio France – SARL, bluebird bio Australia Pty Ltd., bluebird bio (Bermuda) Ltd., bluebird bio (UK) Ltd., and bluebird bio Securities Corporation. All intercompany balances and transactions have been eliminated in consolidation. The assets acquired and liabilities assumed in connection with the Company’s acquisition of Pregenen were recorded at their fair values as of June 30, 2014, the date of the acquisition, and the operating results of Pregenen have been consolidated with those of the Company from the date of acquisition. These 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”). Certain aggregations of prior year amounts have been made to conform to current year presentation. In the prior year statement of operations and comprehensive income (loss), interest income, net and other income (expense), net are included within other income, net. Foreign currency translation The Company’s consolidated financial statements are prepared in U.S. dollars. The Company’s foreign subsidiaries use the U.S. dollar as their functional currency and maintains records in the local currency. Nonmonetary assets and liabilities are re-measured at historical rates and monetary assets and liabilities are re-measured at exchange rates in effect at the end of the reporting period. Income statement accounts are re-measured at average exchange rates for the reporting period. The resulting gains or losses are included in other income (expense), net in the consolidated statements of operations and comprehensive income (loss). Use of estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts in the financial statements and accompanying notes. Actual results could materially differ from those estimates. 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 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 financial statements. Estimates are used in the following areas, among others: acquisition-date fair value and subsequent fair value estimates used to assess potential impairment of long-lived assets, including goodwill and intangible assets, construction financing lease obligations, contingent consideration, stock-based compensation expense, accrued expenses, revenue and income taxes. 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 views its operations and manages its business in one operating segment. All material long-lived assets of the Company reside in the United States. Cash and cash equivalents The Company considers all highly liquid investments purchased with original final maturities of three months or less from the date of purchase to be cash equivalents. Cash and cash equivalents comprise funds in cash, money market accounts, U.S. Treasury securities and federally insured deposits. Cash equivalents are reported at fair value. Marketable securities The Company classifies marketable securities with a remaining maturity when purchased of greater than three months as available-for-sale. Marketable securities with a remaining maturity date greater than one year are classified as non-current. Available-for-sale securities are maintained by an investment manager and consist of U.S. Treasury securities, U.S. government agency securities, and certificates of deposit. Available-for-sale securities are carried at fair value with the unrealized gains and losses included in other comprehensive income (loss) as a component of stockholders’ equity until realized. Any premium or discount arising at purchase is amortized and/or accreted to interest income and/or expense over the life of the instrument. Realized gains and losses are determined using the specific identification method and are included in other income (expense), net. If any adjustment to fair value reflects a decline in value of the investment, the Company considers all available evidence to evaluate the extent to which the decline is “other-than-temporary” and, if so, marks the investment to market through a charge to the Company’s statement of operations and comprehensive income (loss). Concentrations of credit risk and off-balance sheet risk Financial instruments that subject the Company to credit risk primarily consist of cash and cash equivalents and available-for-sale securities. The Company maintains its cash and cash equivalent balances with high-quality financial institutions and, consequently, the Company believes that such funds are subject to minimal credit risk. The Company’s available-for-sale investments primarily consist of U.S. Treasury securities, U.S. government agency securities and certificates of deposit, and potentially subject the Company to concentrations of credit risk. The Company has adopted an investment policy which limits the amounts the Company may invest in any one type of investment and requires all investments held by the Company to be at least AA+/Aa1 rated, thereby reducing credit risk exposure. Fair value of financial instruments The Company is required to disclose information on all assets and liabilities reported at fair value that enables an assessment of the inputs used in determining the reported fair values. FASB ASC Topic 820, Fair Value Measurements and Disclosures (“ASC 820”), establishes a hierarchy of inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the asset or liability, and are developed based on the best information available in the circumstances. The fair value hierarchy applies only to the valuation inputs used in determining the reported fair value of the investments and is not a measure of the investment credit quality. The three levels of the fair value hierarchy are described below: Level 1—Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Level 2—Valuations based on quoted prices for similar assets or liabilities in markets that are not active or for which all significant inputs are observable, either directly or indirectly. Level 3—Valuations that require inputs that reflect the Company’s own assumptions that are both significant to the fair value measurement and unobservable. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Items measured at fair value on a recurring basis include marketable securities (Note 3 and Note 4) and contingent consideration (Note 4). The carrying amounts of accounts payable and accrued expenses approximate their fair values due to their short-term maturities. Business combinations On June 30, 2014, the Company completed its acquisition of Pregenen for total consideration of $31.0 million, consisting of cash consideration of $5.1 million, common stock consideration of $19.3 million and contingent consideration with an estimated fair value of $6.6 million on the date of purchase. The estimated fair value of the contingent consideration is based upon significant assumptions regarding probabilities of successful achievement of related milestones, the estimated timing in which the milestones are achieved and discount rates. The estimated fair value could materially differ from actual values or fair values determined using different assumptions. See Note 4, “Fair value measurements,” for additional information. This transaction was accounted for as a business combination under the acquisition method of accounting. Accordingly, the tangible assets and identifiable intangible assets acquired and liabilities assumed were recorded at fair value as of the date of acquisition, with the excess purchase price recorded as goodwill. The estimated fair values of acquired assets and assumed liabilities were determined using the methods discussed in the following paragraphs and require significant judgment and estimates, which could materially differ from actual values and fair values determined using different methods or assumptions. Goodwill Goodwill represents the excess of the purchase price over the fair value of the net assets acquired when accounted for using the acquisition method of accounting for business combinations. Goodwill is not amortized but is evaluated for impairment within the Company’s single reporting unit on an annual basis, during the fourth quarter, or more frequently if an event occurs or circumstances change that would more-likely-than-not reduce the fair value of the Company’s reporting unit below its carrying amount. The Company has not recognized any impairment charges related to goodwill. Intangible assets Intangible assets consist of acquired core technology with finite lives. The Company amortizes its intangible assets using the straight-line method over their estimated economic lives. The Company evaluates the potential impairment of intangible assets if events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable or that the useful lives of these assets are no longer appropriate. The impairment test is based on a comparison of the undiscounted cash flows expected to be generated from the use of the asset group and its eventual disposition to the carrying value of the asset group. If impairment is indicated, the asset is written down by the amount by which the carrying value of the asset exceeds the related fair value of the asset. The Company has not recognized an impairment charge related to intangible assets. Contingent consideration Each reporting period, the Company revalues the contingent consideration obligations associated with business combinations to their fair value and records within operating expenses increases in their fair value as contingent consideration expense and decreases in the fair value as contingent consideration income. Changes in contingent consideration result from changes in the assumptions regarding probabilities of successful achievement of related milestones, the estimated timing in which the milestones are achieved and the discount rate used to estimate the fair value of the liability. Contingent consideration may change significantly as development of the Company’s programs in certain indications progress and additional data are obtained, impacting the Company’s assumptions. The assumptions used in estimating fair value require significant judgment. The use of different assumptions and judgments could result in a materially different estimate of fair value. See Note 4, “Fair value measurements,” for additional information. Property and equipment Property and equipment is stated at cost. Maintenance and repairs that do not improve or extend the lives of the respective assets are expensed to operations as incurred. Upon disposal, the related cost and accumulated depreciation is removed from the accounts and any resulting gain or loss is included in the results of operations. Depreciation and amortization is calculated using the straight-line method over the estimated useful lives of the assets, which are as follows: Asset Estimated useful life Computer equipment and software 3 years Office and laboratory equipment 2 -5 years Leasehold improvements Shorter of the useful life or remaining lease term The Company records certain estimated construction costs incurred and reported by a landlord as an asset and corresponding construction financing lease obligation on the consolidated balance sheets. See Note 8, “Commitments and contingencies,” for additional information. Impairment of long-lived assets The Company reviews long-lived assets when events or changes in circumstances indicate the carrying value of the assets may not be recoverable. Recoverability is measured by comparison of the book values of the assets to future net undiscounted cash flows that the assets are expected to generate. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the book value of the assets exceed their fair value, which is measured based on the projected discounted future net cash flows arising from the assets. No impairment losses have been recorded during the years ended December 31, 2016, 2015 and 2014. Construction financing lease obligation Beginning in 2015 and until expected construction completion in 2017, the Company records certain Revenue recognition The Company has primarily generated revenue through collaboration arrangements, research arrangements and license arrangements with strategic partners and nonprofit organizations for the development and commercialization of product candidates. Additionally, the Company has generated revenue from research and development grant programs. The Company recognizes revenue in accordance with FASB ASC Topic 605, Revenue Recognition (“ASC 605”). Accordingly, revenue is recognized for each unit of accounting when all of the following criteria are met: • Persuasive evidence of an arrangement exists • Delivery has occurred or services have been rendered • The seller’s price to the buyer is fixed or determinable • Collectability is reasonably assured Amounts received prior to satisfying the revenue recognition criteria are recorded as deferred revenue in the Company’s consolidated balance sheets. Amounts expected to be recognized as revenue within the 12 months following the balance sheet date are classified as deferred revenue, current portion. Amounts not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as deferred revenue, net of current portion. Collaboration revenue As of December 31, 2016, the Company’s collaboration revenue is generated exclusively from its collaboration arrangement with Celgene Corporation (“Celgene”), which was originally entered into in March 2013 and was subsequently amended in June 2015 (the “Amended Collaboration Agreement”). The amended terms of this arrangement contain multiple deliverables, which include at inception: (i) research and development services, (ii) participation on a joint steering committee (“JSC”), (iii) participation on the patent committee, (iv) a license to the first product candidate, (v) manufacture of vectors and associated payload for incorporation into the first optioned product candidate under the license, and (vi) participation on a joint governance committee (“JGC”) under the co-development and co-promotion agreement for the first optioned product candidate under the license. In connection with the Amended Collaboration Agreement, the Company received an upfront, one-time, non-refundable, non-creditable payment of $25.0 million to fund research and development under the collaboration. Other non-refundable payments to the Company under this arrangement may include: (i) product candidate license fees, (ii) payments in the event the Company does not exercise its option to co-develop and co-promote in the United States, (iii) payments for the manufacture and supply of vectors and payloads, (iv) payments based on the achievement of certain clinical, regulatory, and commercials milestones and (v) royalties on product sales. The Company analyzes multiple-element arrangements based on the guidance in FASB ASC Topic 605-25, Revenue Recognition-Multiple-Element Arrangements (“ASC 605-25”). Pursuant to the guidance in ASC 605-25, the Company evaluates multiple-element arrangements to determine (1) the deliverables included in the arrangement and (2) whether the individual deliverables represent separate units of accounting or whether they must be accounted for as a combined unit of accounting. This evaluation involves subjective determinations and requires management to make judgments about the individual deliverables and whether such deliverables are separable from the other aspects of the contractual relationship. Deliverables are considered separate units of accounting provided that: (i) the delivered item(s) has value to the customer on a standalone basis and (ii) if the arrangement includes a general right of return relative to the delivered item(s), delivery or performance of the undelivered item(s) is considered probable and substantially in the control of the Company. In assessing whether an item has standalone value, the Company considers factors such as the research, manufacturing and commercialization capabilities of the collaboration partner and the availability of the associated expertise in the general marketplace. In addition, the Company considers whether the collaboration partner can use the other deliverable(s) for their intended purpose without the receipt of the remaining element(s), whether the value of the deliverable is dependent on the undelivered item(s) and whether there are other vendors that can provide the undelivered element(s). The Company’s collaboration arrangement does not contain a general right of return relative to the delivered item(s). Arrangement consideration that is fixed or determinable is allocated among the separate units of accounting using the relative selling price method. Then, the applicable revenue recognition criteria in ASC 605-25 are applied to each of the separate units of accounting in determining the appropriate period and pattern of recognition. The Company determines the selling price of a unit of accounting following the hierarchy of evidence prescribed by ASC 605-25. Accordingly, the Company determines the estimated selling price for units of accounting within each arrangement using vendor-specific objective evidence (“VSOE”) of selling price, if available, third-party evidence (“TPE”) of selling price if VSOE is not available, or best estimate of selling price (“BESP”) if neither VSOE nor TPE is available. The Company typically uses BESP to estimate the selling price, since it generally does not have VSOE or TPE of selling price for its units of accounting. Determining the BESP for a unit of accounting requires significant judgment. In developing the BESP for a unit of accounting, the Company considers applicable market conditions and relevant entity-specific factors, including factors that were contemplated in negotiating the agreement with the customer and estimated costs. The Company validates the BESP for units of accounting by evaluating whether changes in the key assumptions used to determine the BESP will have a significant effect on the allocation of arrangement consideration between multiple units of accounting. Options are considered substantive if, at the inception of the arrangement, the Company is at risk as to whether the collaboration partner will choose to exercise the option. Factors that the Company considers in evaluating whether an option is substantive include the overall objective of the arrangement, the benefit the collaborator might obtain from the arrangement without exercising the option, the cost to exercise the option and the likelihood that the option will be exercised. For arrangements under which an option is considered substantive, the Company does not consider the item underlying the option to be a deliverable at the inception of the arrangement and the associated option fees are not included in allocable arrangement consideration, assuming the option is not priced at a significant and incremental discount. Conversely, for arrangements under which an option is not considered substantive or if an option is priced at a significant and incremental discount, the Company would consider the item underlying the option to be a deliverable at the inception of the arrangement and a corresponding amount would be included in allocable arrangement consideration. At execution of the Amended Collaboration Agreement, one of the options was determined not to be substantive and any other options were determined to be substantive. The Company recognizes arrangement consideration allocated to each unit of accounting when all of the revenue recognition criteria in ASC 605-25 are satisfied for that particular unit of accounting. The Company will recognize as revenue arrangement consideration attributed to licenses that have standalone value from the other deliverables to be provided in an arrangement upon delivery. The Company will recognize as revenue arrangement consideration attributed to licenses that do not have standalone value from the other deliverables to be provided in an arrangement over the Company’s estimated performance period as the arrangement would be accounted for as a single unit of accounting. The Company recognizes revenue from the Celgene arrangement associated research and development services, joint steering committee services and patent committee services ratably over the associated period of performance, which is initially estimated to be three years. If there is no discernible pattern of performance and/or objectively measurable performance measures do not exist, then the Company recognizes revenue under the arrangement on a straight-line basis over the period the Company is expected to complete its performance obligations. Conversely, if the pattern of performance in which the service is provided to the customer can be determined and objectively measurable performance measures exist, then the Company recognizes revenue under the arrangement using the proportional performance method. Revenue recognized is limited to the lesser of the cumulative amount of payments received or the cumulative amount of revenue earned, as determined using the straight-line method or proportional performance method, as applicable, as of the period ending date. At the inception of an arrangement that includes milestone payments, the Company evaluates whether each milestone is substantive and at risk to both parties on the basis of the contingent nature of the milestone. This evaluation includes an assessment of whether: (i) the consideration is commensurate with either the Company’s performance to achieve the milestone or the enhancement of the value of the delivered item(s) as a result of a specific outcome resulting from the Company’s performance to achieve the milestone, (ii) the consideration relates solely to past performance and (iii) the consideration is reasonable relative to all of the deliverables and payment terms within the arrangement. The Company evaluates factors such as the scientific, clinical, regulatory, commercial and other risks that must be overcome to achieve the respective milestone and the level of effort and investment required to achieve the respective milestone in making this assessment. There is considerable judgment involved in determining whether a milestone satisfies all of the criteria required to conclude that a milestone is substantive. The Company has concluded that all of the clinical and regulatory milestones pursuant to its collaboration arrangement are substantive. Accordingly, in accordance with FASB ASC Topic 605-28, Revenue Recognition-Milestone Method, revenue from clinical and regulatory milestone payments will be recognized in its entirety upon successful accomplishment of the milestone, assuming all other revenue recognition criteria are met. Milestones that are not considered substantive would be recognized as revenue over the remaining period of performance, assuming all other revenue recognition criteria are met. All commercial milestones will be accounted for in the same manner as royalties and recorded as revenue upon achievement of the milestone, assuming all other revenue recognition criteria are met. The Company will recognize royalty revenue in the period of sale of the related product(s), based on the underlying contract terms, provided that the reported sales are reliably measurable and the Company has no remaining performance obligations, assuming all other revenue recognition criteria are met. Research fees and license fees The terms of the Company’s research agreements and license agreements have previously included delivery of an intellectual property license or the performance of research and development activities. The Company does not have any material research arrangements or license arrangements that contain multiple deliverables. The Company is compensated under research arrangements and license arrangements through nonrefundable up-front payments and future royalties on net product sales. Research fees are recognized as revenue on a straight-line basis over the period that the research services are expected to be performed unless the Company’s pattern of performance can be determined to be other than straight-line, in which case, the Company uses the proportional performance method. Nonrefundable license fees are recognized as revenue upon delivery provided there are no undelivered elements in the arrangement. Research and development expenses Research and development costs are charged to expense as costs are incurred in performing research and development activities, including salaries and benefits, facilities costs, overhead costs, clinical study and related clinical manufacturing costs, contract services and other related costs. Research and development costs, including up-front fees and milestones paid to collaborators, are also expensed as incurred. In circumstances where amounts have been paid in excess of costs incurred, the Company records a prepaid expense. Stock-based compensation The Company accounts for its stock-based compensation awards in accordance with FASB ASC Topic 718, Compensation—Stock Compensation (“ASC 718”). ASC 718 requires all stock-based payments to employees, including grants of employee stock options and restricted stock units and modifications to existing stock options, to be recognized in the consolidated statements of operations and comprehensive income (loss) based on their fair values. The Company uses the Black-Scholes option pricing model to determine the fair value of options granted. The Company’s stock-based awards are subject to either service or performance-based vesting conditions. Compensation expense related to awards to employees and directors with service-based vesting conditions is recognized on a straight-line basis based on the grant date fair value over the associated service period of the award, which is generally the vesting term. Compensation expense related to awards to non-employees with service-based vesting conditions is recognized based on the then-current fair value at each financial reporting date prior to the measurement date over the associated service period of the award, which is generally the vesting term, using the accelerated attribution method. Compensation expense related to awards to employees with performance-based vesting conditions is recognized based on the grant date fair value over the requisite service period using the accelerated attribution method to the extent achievement of the performance condition is probable. Compensation expense related to awards to non-employees with performance-based vesting conditions is recognized based on the then-current fair value at each financial reporting date prior to the measurement date over the requisite service period using the accelerated attribution method to the extent achievement of the performance condition is probable. The Company expenses restricted stock unit awards to employees based on the fair value of the award on a straight-line basis over the associated service period of the award. Awards of restricted stock units to non-employees are adjusted through stock-based compensation expense at each reporting period end to reflect the current fair value of such awards and expensed using an accelerated attribution model. The Company estimates the fair value of its option awards to employees and directors using the Black-Scholes option pricing model, which requires the input of and subjective assumptions, including (i) the expected stock price volatility, (ii) the calculation of expected term of the award, (iii) the risk-free interest rate, and (iv) expected dividends. Due to the lack of company specific historical and implied volatility data of its common stock, the Company has based its estimate of expected volatility on the historical volatility of a group of similar companies that are publicly traded. When selecting these public companies on which it has based its expected stock price volatility, the Company selected companies with comparable characteristics to it, including enterprise value, risk profiles, position within the industry, and with historical share price information sufficient to meet the expected term of the stock-based awards. The Company computes historical volatility data using the daily closing prices for the selected companies’ shares during the equivalent period of the calculated expected term of the stock-based awards. The Company will continue to apply this process until a sufficient amount of historical information regarding the volatility of its own stock price becomes available, which is expected in 2017. The Company has estimated the expected term of its employee stock options using the “simplified” method, whereby, the expected term equals the arithmetic average of the vesting term and the original contractual term of the option due to its lack of sufficient historical data. The risk-free interest rates for periods within the expected term of the option are based on the U.S. Treasury securities with a maturity date commensurate with the expected term of the associated award. The Company has never paid, and does not expect to pay dividends in the foreseeable future. The Company is also required to estimate forfeitures at the time of grant, and revise those estimates in subsequent periods if actual forfeitures differ from its estimates. The Company uses historical data to estimate pre-vesting option forfeitures and records stock-based compensation expense only for those awards that are expected to vest. To the extent that actual forfeitures differ from the Company’s estimates, the differences are recorded as a cumulative adjustment in the period the estimates were revised. Stock-based compensation expense recognized in the financial statements is based on awards that are ultimately expected to vest. Consistent with the guidance in FASB ASC Topic 505-50, Equity-Based Payments to Non- |
Marketable Securities
Marketable Securities | 12 Months Ended |
Dec. 31, 2016 | |
Investments Debt And Equity Securities [Abstract] | |
Marketable securities | 3. Marketable securities The following table summarizes the available-for-sale securities held at December 31, 2016 and 2015 (in thousands): Description Amortized Cost Unrealized Gains Unrealized Losses Fair Value December 31, 2016 U.S. government agency securities and treasuries $ 600,001 $ 34 $ (575 ) $ 599,460 Certificates of deposit 6,480 6 (3 ) 6,483 Total $ 606,481 $ 40 $ (578 ) $ 605,943 December 31, 2015 U.S. government agency securities and treasuries $ 689,425 $ 22 $ (2,300 ) $ 687,147 Certificates of deposit 14,360 — (13 ) 14,347 Total $ 703,785 $ 22 $ (2,313 ) $ 701,494 No available-for-sale securities held as of December 31, 2016 or 2015 had remaining maturities greater than three years. |
Fair value measurements
Fair value measurements | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair value measurements | 4. Fair value measurements The following table sets forth the Company’s assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2016 and 2015 (in thousands): Description Total Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) December 31, 2016 Assets: Cash and cash equivalents $ 278,887 $ 278,887 $ — $ — Marketable securities: U.S. government agency securities and treasuries 599,460 — 599,460 — Certificates of deposit 6,483 — 6,483 — Total assets $ 884,830 $ 278,887 $ 605,943 $ — Liabilities: Contingent consideration $ 7,756 $ — $ — $ 7,756 Total liabilities $ 7,756 $ — $ — $ 7,756 December 31, 2015 Assets: Cash and cash equivalents $ 164,269 $ 158,269 $ 6,000 $ — Marketable securities: U.S. government agency securities 687,147 — 687,147 — Certificates of deposit 14,347 — 14,347 — Total assets $ 865,763 $ 158,269 $ 707,494 $ — Liabilities: Contingent consideration $ 8,665 $ — $ — $ 8,665 Total liabilities $ 8,665 $ — $ — $ 8,665 Cash and cash equivalents The Company considers all highly liquid securities with original final maturities of three months or less from the date of purchase to be cash equivalents. As of December 31, 2016, cash and cash equivalents comprise funds in cash, money market accounts, and federally insured deposits . Marketable securities The amortized cost of available-for-sale securities is adjusted for amortization of premiums and accretion of discounts to maturity. At December 31, 2016 and 2015, the balance in the Company’s accumulated other comprehensive income (loss) was composed solely of activity related to the Company’s available-for-sale marketable securities. There were no material realized gains or losses recognized on the maturity of available-for-sale securities during the years ended December 31, 2016 or 2015, and as a result, the Company did not reclassify any amount out of accumulated other comprehensive income (loss) for the same periods. The aggregate fair value of securities held by the Company in an unrealized loss position for less than twelve months as of December 31, 2016 and 2015 was $376.1 million and $638.1 million, respectively. As of December 31, 2016, there were $95.5 million in securities held by the Company in an unrealized loss position for more than twelve months. There were no securities held by the Company in an unrealized loss position for more than twelve months as of December 31, 2015. The Company has the intent and ability to hold such securities until recovery. The Company determined that there was no material change in the credit risk of the above investments. As a result, the Company determined it did not hold any investments with an other-than-temporary impairment as of December 31, 2016 and 2015. Contingent consideration In connection with the acquisition of Pregenen, the Company recorded contingent consideration pertaining to the amounts potentially payable to Pregenen’s former equityholders pursuant to the Stock Purchase Agreement by and among the Company, Pregenen and Pregenen’s former equityholders. Contingent consideration is measured at fair value and is based on significant inputs not observable in the market, which represents a Level 3 measurement within the fair value hierarchy. The valuation of contingent consideration uses assumptions the Company believes would be made by a market participant. The Company assesses these estimates on an on-going basis as additional data impacting the assumptions is obtained. Future changes in the fair value of contingent consideration related to updated assumptions and estimates are recognized within the consolidated statements of operations and comprehensive income (loss). Contingent consideration may change significantly as development progresses and additional data are obtained, impacting the Company’s assumptions regarding probabilities of successful achievement of related milestones used to estimate the fair value of the liability and the timing in which they are expected to be achieved. In evaluating the fair value information, considerable judgment is required to interpret the market data used to develop the estimates. The estimates of fair value may not be indicative of the amounts that could be realized in a current market exchange. Accordingly, the use of different market assumptions and/or different valuation techniques could result in materially different fair value estimates. The significant unobservable inputs used in the measurement of fair value of the Company’s contingent consideration are probabilities of successful achievement of preclinical, clinical and commercial milestones, the period in which these milestones are expected to be achieved ranging from 2017 to 2026 and discount rates ranging from 10.1% to 13.1%. Significant increases or decreases in any of the probabilities of success would result in a significantly higher or lower fair value measurement, respectively. Significant increases or decreases in these other inputs would result in a significantly lower or higher fair value measurement, respectively. The table below provides a roll-forward of fair value of the Company’s contingent consideration obligations which include Level 3 inputs (in thousands): Year ended December 31, 2016 2015 Beginning balance $ 8,665 $ 6,796 Additions — — Changes in fair value 4,091 2,869 Payments (5,000 ) (1,000 ) Ending balance $ 7,756 $ 8,665 As of December 31, 2016 and 2015, $ 4.5 3.3 |
Property and equipment, net
Property and equipment, net | 12 Months Ended |
Dec. 31, 2016 | |
Property Plant And Equipment [Abstract] | |
Property and equipment, net | 5. Property and equipment, net Property and equipment, net, consists of the following (in thousands): December 31, 2016 2015 Computer equipment and software $ 1,655 $ 1,259 Office equipment 1,427 1,104 Laboratory equipment 16,305 10,520 Leasehold improvements 13,697 11,010 Construction-in-progress 136,315 65,542 Total property and equipment 169,399 89,435 Less accumulated depreciation and amortization (12,444 ) (6,821 ) Property and equipment, net $ 156,955 $ 82,614 Depreciation and amortization expense related to property and equipment was $5.9 |
Restricted cash
Restricted cash | 12 Months Ended |
Dec. 31, 2016 | |
Cash And Cash Equivalents [Abstract] | |
Restricted cash | 6. Restricted cash As of December 31, 2016 and 2015, the Company maintained letters of credit of $ |
Accrued expenses and other curr
Accrued expenses and other current liabilities | 12 Months Ended |
Dec. 31, 2016 | |
Payables And Accruals [Abstract] | |
Accrued expenses and other current liabilities | 7. Accrued expenses and other current liabilities Accrued expenses and other current liabilities consist of the following (in thousands): December 31, 2016 2015 Employee compensation $ 11,296 $ 5,935 Accrued goods and services 34,275 15,876 Accrued license and milestone fees 2,464 277 Accrued professional fees 1,492 1,014 Deferred rent, current portion 11 964 Contingent consideration, current portion 4,479 3,584 Other 643 495 Total accrued expenses and other current liabilities $ 54,660 $ 28,145 The change in employee compensation was primarily driven by an increase in accrued bonus of $4.9 million, primarily related to an increase in headcount. The change in accrued goods and services was primarily driven by a $4.5 million accrual for construction at 60 Binney Street as well as a $6.2 million accrual relating to services performed by a contract manufacturing organization. |
Commitments and contingencies
Commitments and contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and contingencies | 8. Commitments and contingencies On June 3, 2013, the Company entered into a nine-year building lease for approximately 43,600 square feet of space located at 150 Second Street, Cambridge, Massachusetts, which commenced in December 2013. This lease was amended in June 2014 to add approximately 9,900 additional square feet. The lease originally had monthly lease payments of $0.2 million for the first 12 months, which increased to $0.3 million per month beginning in December 2014 due to the lease amendment, with annual rent escalations thereafter. Rent expense is recognized on a straight-line basis over the term of the lease. The lease provided a contribution from the landlord towards the initial build-out of the space of up to $7.8 million. The Company capitalizes the leasehold improvements as property and equipment and records the landlord incentive payments received as deferred rent and amortizes these amounts as reductions to rent expense over the lease term. In addition, in accordance with the lease, the Company entered into a cash-collateralized irrevocable standby letter of credit in the amount of $1.3 million, naming the landlord as beneficiary, which had a balance of $0.6 as of December 31, 2016 and 2015. On September 30, 2016, the Company entered into an Assignment and Assumption of Lease (“Assignment”) relating to its lease at 150 Second Street. Under the Assignment, the Company will assign all of its rights, interests, obligations and responsibilities under the lease, to be effective as of the later of May 1, 2017 or the first day following the Company’s surrender of the leased premises in accordance with the lease. The Company expects to vacate the premises during the second quarter of 2017. On June 29, 2015, the Company entered into a lease agreement for additional office space located at 215 First Street, Cambridge, Massachusetts. Under the terms of the lease, the Company leased approximately 15,120 square feet starting on July 13, 2015 for $0.5 million per year in base rent, which is subject to a 3% annual rent increase plus certain operating expenses and taxes. The lease may continue until the end of the 60 th th On June 3, 2016, the Company entered into a strategic manufacturing agreement for the future commercial production of the Company’s Lenti-D and LentiGlobin product candidates with a contract manufacturing organization. Under this 12 year agreement, the contract manufacturing organization will complete the design, construction, validation and process validation of the leased suites prior to anticipated commercial launch of the product candidates. During construction, the Company is required to pay $12.5 million upon the achievement of certain contractual milestones, and may pay up to $8.0 million in additional contractual milestones if the Company elects its option to lease additional suites. The Company paid $5.0 million for the achievement of the first and second contractual milestones during 2016 and paid the third milestone of $3.0 million in January 2017, which is reflected as a component of accrued expenses and other current liabilities within the consolidated balance sheet at December 31, 2016. Leases - Overall On November 18, 2016, the Company entered into an agreement for future clinical and commercial production of the Company’s LentiGlobin gene therapy drug products with a contract manufacturing organization at an existing facility. The term of the agreement is five years with a three year renewal at the mutual option of each party. Under the agreement, the Company is required to pay an up-front fee of €3.0 million, €2.0 million of which was paid in the fourth quarter of 2016 and €1.0 million of which is expected to be paid in mid-2018, and annual maintenance and production fees of up to €9.8 million, depending on its production needs. The Company may terminate this agreement with six months’ notice and a one-time termination fee prior to July 1, 2018, or twelve months’ notice and a one-time termination fee thereafter. The Company concluded that this agreement contains an embedded lease as the clean rooms are designated for the Company’s exclusive use during the term of the agreement, and determined that it is not a capital lease under ASC 840-10, Leases – Overall 60 Binney Street Lease Commitments On September 21, 2015, the Company entered into a lease agreement for additional office and laboratory space located in a building (the “Building”) under construction at 60 Binney Street, Cambridge, Massachusetts (the “60 Binney Street Lease”). Under the terms of the 60 Binney Street Lease, starting on October 1, 2016, the Company will lease approximately 253,108 square feet of office and laboratory space at $72.50 per square foot per year, or $18.4 million per year in base rent, which is subject to scheduled annual rent increases of 1.75% plus certain operating expenses and taxes. The Company also executed a $9.2 million letter of credit upon signing the 60 Binney Street Lease, which was required to be collateralized with a bank account at a financial institution in accordance with the 60 Binney Street Lease agreement. This letter of credit was increased to $13.8 million during the third quarter of 2016 as required under the terms of the lease. Subject to the terms of the lease and certain reduction requirements specified therein, including market capitalization requirements, this amount may decrease back to $9.2 million over time. The 60 Binney Street Lease will continue until the end of the 120 th Because the Company is involved in the construction project, including having responsibility to pay for a portion of the costs of finish work and mechanical, electrical, and plumbing elements of the Building, among other items, the Company is deemed for accounting purposes to be the owner of the Building during the construction period. Accordingly, construction costs that have been incurred by the landlord directly or indirectly through reimbursement to the Company as part of its tenant improvement allowance have been recorded as an asset in “Property and equipment, net” with a related financing obligation in “Construction financing lease obligation” on the Company’s consolidated balance sheets. Tenant improvement costs that are reimbursable by the landlord and have not yet been paid to the Company are also recorded in “Prepaid expenses and other current assets” on the Company’s consolidated balance sheets. Tenant improvement costs that are not reimbursable by the landlord are only recorded in “Property and equipment, net” on the Company’s consolidated balance sheets. As of December 31, 2016, Property and equipment, net, includes $126.9 million related to construction costs for the Building, of which $120.1 million has been incurred by the landlord. As of December 31, 2016, Prepaid expenses and other current assets includes $8.5 million of tenant improvement costs reimbursable by the landlord that had not yet been received, $7.8 million of which was received by the Company in January 2017. The Company incurred tenant improvement costs of $1.8 million through December 31, 2016 that are not reimbursable by the landlord. No payments were made by the Company to the landlord during the twelve months ended December 31, 2016. The Company bifurcates its future lease payments pursuant to the 60 Binney Street Lease into (i) a portion that is allocated to the Building and (ii) a portion that is allocated to the land on which the Building is being constructed, which is recorded as rental expense. Although the Company estimates that the Company will not begin making lease payments pursuant to the 60 Binney Street Lease until April 2017, the portion of the lease obligation allocated to the land is treated for accounting purposes as an operating lease that commenced upon execution of the 60 Binney Street Lease in September 2015. During the year ended December 31, 2016, the Company recognized $1.9 million of non-cash rental expense attributable to the land. In the event that the landlord completes the construction of the Building in 2017 as planned, the Company will evaluate the 60 Binney Street Lease in order to determine whether or not the 60 Binney Street Lease meets the criteria for “sale-leaseback” treatment. If the 60 Binney Street Lease meets the “sale-leaseback” criteria, the Company will remove the asset and the related liability from its consolidated balance sheet and treat the 60 Binney Street Lease as either an operating or a capital lease based on the Company’s assessment of the accounting guidance. The Company expects that upon completion of construction of the Building the 60 Binney Street Lease will not meet the “sale-leaseback” criteria. If the 60 Binney Street Lease does not meet “sale-leaseback” criteria, the Company will treat the 60 Binney Street Lease as a financing obligation and will depreciate the asset in accordance with the Company’s accounting policy. As of December 31, 2016, future minimum commitments under the 60 Binney Street Lease and facility operating leases were as follows (in thousands): Years ended December 31, 60 Binney Street Lease 150 Second Street Lease Other Operating Leases Total Lease Commitments 2017 $ 13,102 $ 1,359 $ 11,963 $ 26,424 2018 18,647 - 10,368 29,015 2019 18,974 - 9,841 28,815 2020 19,305 - 9,841 29,146 2021 19,643 - 9,841 29,484 2022 and thereafter 108,875 - 32,725 141,600 Total minimum lease payments $ 198,546 $ 1,359 $ 84,579 $ 284,484 (1) Amounts are subject to increase if the Company does not vacate the leased premise during the second quarter of 2017 as planned. For the 60 Binney Street Lease, the table above sets forth the future minimum rental payments that the Company is obligated to pay after taking occupancy including amounts reflected on the consolidated balance sheet under the caption “Construction financing lease obligation.” The Company expects to commence these rental payments upon completion of the Building in April 2017. Rent expense is calculated on a straight-line basis over the term of the lease. Rent expense recognized under all leases, including additional rent charges for utilities, parking, maintenance, and real estate taxes, and including rental expense attributable to the 60 Binney Street Lease land was $8.3 The Company is party to various agreements, principally relating to licensed technology, that require future payments relating to milestones not met at December 31, 2016 and December 31, 2015 or royalties on future sales of specified products. 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. 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. On June 30, 2014, the Company acquired Pregenen. During 2016, two milestones under the Stock Purchase Agreement were achieved, which resulted in a $5.0 million payment to the former equityholders of Pregenen during 2016. During 2015, one milestone was achieved, which resulted in a $1.0 million payment to the former equityholders of Pregenen. The Company may be required to make up to an additional $129.0 million in future contingent cash payments to the former equityholders of Pregenen upon the achievement of certain preclinical, clinical and commercial milestones related to the Pregenen technology, of which $9.0 million relates to preclinical milestones, $20.1 million relates to clinical milestones and $99.9 million relates to commercial milestones. In accordance with accounting for business combinations guidance, contingent consideration liabilities are required to be recognized on the consolidated balance sheets at fair value. Estimating the fair value of contingent consideration requires the use of significant assumptions primarily relating to probabilities of successful achievement of certain preclinical, clinical and commercial milestones, the expected timing in which these milestones will be achieved and discount rates. The use of different assumptions could result in materially different estimates of fair value. See Note 4, “Fair value measurements” for additional information. |
Common stock and preferred stoc
Common stock and preferred stock | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Common stock and preferred stock | 9. Common stock and preferred stock The Company is authorized to issue 125,000,000 shares of common stock. Holders of common stock are entitled to one vote per share. Holders of common stock are entitled to receive dividends, if and when declared by the Company’s Board of Directors, and to share ratably in the Company’s assets legally available for distribution to the Company’s shareholders in the event of liquidation. Holders of common stock have no preemptive, subscription, redemption or conversion rights. The Company is authorized to issue 5,000,000 shares of preferred stock in one or more series and to fix the powers, designations, preferences and relative participating option or other rights thereof, including dividend rights, conversion rights, voting rights, redemption terms, liquidation preferences and the number of shares constituting any series, without any further vote or action by the Company’s shareholders. As of December 31, 2016 and 2015, the Company had no shares of preferred stock issued or outstanding. Reserved for future issuance The Company has reserved for future issuance the following number of shares of common stock (in thousands): December 31, 2016 2015 Options to purchase common stock 3,735 3,532 Restricted stock units 263 148 2013 Stock Option and Incentive Plan 1,226 565 2013 Employee Stock Purchase Plan 209 227 5,433 4,472 |
Significant agreements
Significant agreements | 12 Months Ended |
Dec. 31, 2016 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Significant agreements | 10. Significant agreements Celgene Corporation Original Collaboration Agreement On March 19, 2013, the Company entered into a Master Collaboration Agreement (the “Collaboration Agreement”) with Celgene Corporation (“Celgene”) to discover, develop and commercialize potentially disease-altering gene therapies in oncology. The collaboration is focused on applying gene therapy technology to genetically modify a patient’s own T cells, known as chimeric antigen receptor, or CAR T cells, to target and destroy cancer cells. Additionally, on March 19, 2013, the Company entered into a Platform Technology Sublicense Agreement (the “Sublicense Agreement”) with Celgene pursuant to which the Company obtained a sublicense to certain intellectual property from Celgene, originating under Celgene’s license from Baylor College of Medicine, for use in the collaboration. Under the terms of the Collaboration Agreement, the Company received a $75.0 million up-front, non-refundable cash payment. The Company was responsible for conducting discovery, research and development activities through completion of Phase I clinical studies, if any, during the initial term of the Collaboration Agreement, or three years. The collaboration is governed by a joint steering committee (“JSC”) formed by an equal number of representatives from the Company and Celgene. The JSC, among other activities, reviews the collaboration program, reviews and evaluates product candidates and approves regulatory plans. In addition to the JSC, the Collaboration Agreement provides that the Company and Celgene each appoint representatives to a patent committee, which is responsible for managing the intellectual property developed and used during the collaboration. Amended Collaboration Agreement On June 3, 2015, the Company and Celgene amended and restated the Collaboration Agreement (the “Amended Collaboration Agreement”). Under the Amended Collaboration Agreement, the parties will now focus the collaboration exclusively on anti- B-cell maturation antigen (“BCMA”) product candidates for a new three-year term. In connection with the Amended Collaboration Agreement, the Company received an upfront, one-time, non-refundable, non-creditable payment of $25.0 million to fund research and development under the collaboration. The collaboration will continue to be governed by the JSC. Under the terms of the Amended Collaboration Agreement, for up to two product candidates selected for development under the collaboration, the Company is responsible for conducting and funding all research and development activities performed up through completion of the initial Phase I clinical study, if any, of such product candidate. On a product candidate-by-product candidate basis, up through a specified period following enrollment of the first patient in an initial Phase I clinical study for such product candidate (the “Option Period”), the Company has granted Celgene an option to obtain an exclusive worldwide license to develop and commercialize such product candidate pursuant to a written agreement, the form of which the Company has already agreed upon. In the event that Celgene exercises its option with respect to any product candidate, the Company may elect to co-develop and co-promote the product candidate in the United States, provided that, if the Company does not exercise its option co-develop and co-promote the first product candidate in-licensed by Celgene under the Amended Collaboration Agreement, then the Company will not be permitted to exercise its option to co-develop and co-promote any future product candidates under the Amended Collaboration Agreement. If Celgene elects to exercise its option to exclusively in-license a product candidate, it must pay the Company an option fee in the amount of $10.0 million for the first product candidate and $15.0 million for any additional product candidates. On February 10, 2016, Celgene exercised its option to obtain an exclusive worldwide license to develop and commercialize bb2121, the first product candidate under the Amended Collaboration Agreement, pursuant to an executed license agreement entered into by the parties on February 16, 2016 and paid the associated $10.0 million option fee. The Company may now elect to co-develop and co-promote the product candidate within the United States. The Company will share equally in all costs relating to developing, commercializing and manufacturing the product candidate within the United States if it elects to co-develop and co-promote bb2121 with Celgene. In the event the Company does not exercise its option to co-develop and co-promote bb2121, the Company will receive an additional fee in the amount of $10.0 million. February 17, 2016, the parties further amended the Amended Collaboration Agreement to update the timing of certain deliverables in connection with Celgene’s option exercise for the license of the bb2121 product candidate. Accounting Analysis The Company’s Amended Collaboration Agreement with Celgene contains the following deliverables: (i) research and development services, (ii) participation on the JSC, (iii) participation on the patent committee, (iv) a license to the first product candidate, (v) manufacture of vectors and associated payload for incorporation into the first optioned product candidate under the license, and (vi) participation on the JGC under the co-development and co-promotion agreement for the first optioned product candidate under the license. The license to the first product candidate was considered a deliverable at the inception of the arrangement and therefore the associated option fee was included in allocable arrangement consideration as the Company believed there was minimal risk with regard to whether Celgene will exercise the option based on the successful completion of preclinical activities and proximity of enrollment of the first patient in an initial Phase I clinical study for this product candidate. The Company determined that the obligation within the license to manufacture or have manufactured supplies of vectors and associated payloads for incorporation into the first optioned product candidate is a deliverable, consistent with the option to license the first product candidate. However, the Company determined that the options to license any additional product candidates are substantive options and therefore were not considered deliverables at execution of the Amended Collaboration Agreement. Celgene is not contractually obligated to exercise the options. Additionally, as a result of the uncertain outcome of the discovery, research and development activities, the Company is at risk with regard to whether Celgene will exercise the options to license additional product candidates. Moreover, the Company determined that the options are not priced at a significant and incremental discount. Accordingly, the options to other product candidates are not considered deliverables and the associated option fees are not included in allocable arrangement consideration. Upon execution of the Amended Collaboration Agreement in June 2015, the Company concluded that each of the three delivered elements at the inception of the agreement (research and development services, participation on the JSC and participation on the patent committee) had standalone value from the other undelivered elements. Additionally, the Amended Collaboration Agreement does not include return rights related to the collaboration term. Accordingly, each deliverable qualified as a separate unit of accounting. The Company determined that each of the delivered elements had the same period of performance (the three year term through projected initial Phase I clinical study substantial completion) and the same pattern of revenue recognition, ratably over the period of performance as there was no other discernible pattern of recognition. The Company identified the allocable arrangement consideration as the $25.0 million up-front research and development funding payment, $10.0 million option fee for the first product candidate, $20.0 million related to remaining deferred revenue from the original Collaboration Agreement, and $54.1 million of contingent revenue related to the estimated amounts that will be received from Celgene for manufacturing services. The $109.0 million total allocable arrangement consideration was allocated based on the relative estimated selling price of the separate units of accounting at the inception of the amended agreement, resulting in $17.3 million allocated to the three delivered elements at the inception of the agreement, which will be recognized over an initial three year term. The Company is required to reassess its conclusions on standalone value of deliverables upon delivery, and therefore, upon Celgene’s exercise of its option to obtain an exclusive worldwide license to develop and commercialize bb2121 in February 2016, the Company updated its assessment. The Company determined that there were no changes in standalone value of the research and development services as the option was previously determined to be non-substantive, the Company continues to have an obligation to provide research and development services for bb2121 and other product candidates, and this obligation is separate and unrelated to the execution of the license agreement. Participation on the JSC and participation on the patent committee also continue to have standalone value from the other undelivered elements as there has been no change in facts that would change this conclusion. Accordingly, each of these three deliverables continues to qualify as a separate unit of accounting. The Company determined that each of the identified deliverables that qualify as a separate unit of accounting continue to have the same period of performance (the three year term through projected initial Phase I clinical study substantial completion) and the same pattern of revenue recognition, ratably over the period of performance as there is no other discernible pattern of recognition, and therefore there is no change in the recognition of $17.3 million allocated to these three elements. As of December 31, 2016, this will continue to be recognized over a three year term that began in June 2015. However, the Company concluded that the license to bb2121 does not have standalone value from one of the undelivered elements, the post-initial Phase I manufacture of vectors and associated payload for bb2121 under the license, because the manufacturing is essential to the use of the license. Accordingly, these two deliverables qualify as a single combined unit of accounting. The single combined unit of accounting comprised of the license to bb2121 and the manufacture of vectors and associated payload for bb2121 were allocated consideration of $91.7 million, which will begin to be recognized upon the commencement of post-initial Phase I manufacturing services for bb2121 for Celgene, not in excess of the fixed consideration and assuming other revenue recognition criteria have been met. The Company currently expects this recognition may commence in 2017 but has classified deferred revenue associated with the combined unit of accounting as deferred revenue, net of current portion on its consolidated balance sheet given exact timing is currently unknown and the budget for such services has not yet been agreed to by the parties. Revenue for the combined unit of account will be recognized on a proportional performance method or ratably over the period of performance if there is no other discernible pattern of recognition. This period of performance and recognition pattern will be revisited as the development plan changes or if other events impacting the deliverables occur. The Company evaluated all of the milestones that may be received in connection with Celgene’s option to license a product candidate resulting from the collaboration. In evaluating if a milestone is substantive, the Company assesses whether: (i) the consideration is commensurate with either the Company’s performance to achieve the milestone or the enhancement of the value of the delivered item(s) as a result of a specific outcome resulting from the Company’s performance to achieve the milestone, (ii) the consideration relates solely to past performance and (iii) the consideration is reasonable relative to all of the deliverables and payment terms within the arrangement. All clinical and regulatory milestones that may be received under the option to the license agreement are considered substantive on the basis of the contingent nature of the milestone, specifically reviewing factors such as the scientific, clinical, regulatory, commercial and other risks that must be overcome to achieve the milestone as well as the level of effort and investment required. Accordingly, such amounts will be recognized as revenue in full in the period in which the associated milestone is achieved, assuming all other revenue recognition criteria are met. All commercial milestones will be accounted for in the same manner as royalties and recorded as revenue upon achievement of the milestone, assuming all other revenue recognition criteria are met. During the years ended December 31, 2016, 2015 and 2014, the Company recognized $6.2 million, $14.1 million and $25.0 million 46.4 |
Business combinations
Business combinations | 12 Months Ended |
Dec. 31, 2016 | |
Business Combinations [Abstract] | |
Business combinations | 11. Business combinations On June 30, 2014, the Company completed its acquisition of Pregenen, a privately-held biotechnology company, upon which Pregenen became a wholly-owned subsidiary. As a result, the Company obtained gene editing and cell signaling technology with a broad range of potential therapeutic applications. The Company considered the intangible asset acquired to be developed technology, as at the date of the acquisition it could be used the way it is intended to be used in certain ongoing research and development activities. From the date of acquisition, the gene editing platform intangible asset will be amortized to research and development expense over its expected useful life of approximately eight years. Amortization expense for the gene editing platform intangible asset was $3.8 2015 was $9.4 The estimated amortization of intangible assets for the year ended December 31, 2016 and for each of the five succeeding years and thereafter is as follows (in thousands): 2017 $ 3,763 2018 3,763 2019 3,763 2020 3,763 2021 3,763 2022 1,879 Total $ 20,694 |
Stock-based compensation
Stock-based compensation | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-based compensation | 12. Stock-based compensation On June 3, 2013, the Company’s board of directors adopted its 2013 Stock Option and Incentive Plan (“2013 Plan”), which was subsequently approved by its stockholders and became effective upon the closing of the Company’s IPO on June 24, 2013. The 2013 Plan replaces the 2010 Stock Option and Grant Plan (“2010 Plan”). The 2013 Plan allows for the granting of incentive stock options, non-qualified stock options, restricted stock units and restricted stock awards to the Company’s employees, members of the board of directors, and consultants of the Company. The Company initially reserved 955,000 shares of its common stock for the issuance of awards under the 2013 Plan. The 2013 Plan provides that the number of shares reserved and available for issuance under the 2013 Plan will automatically increase each January 1, beginning on January 1, 2014, by four percent of the outstanding number of shares of common stock on the immediately preceding December 31 or such lesser number of shares as determined by the Company’s compensation committee. In January 2016 and January 2017, the number of common stock available for issuance under the 2013 Plan was increased by approximately 1.5 million and 1.6 million shares, respectively, as a result of this automatic increase provision. Any options or awards outstanding under the Company’s previous stock option plans, including both the 2010 Plan and the Second Amended and Restated 2002 Employee, Director and Consultant Stock Plan (“2002 Plan”), at the time of adoption of the 2013 Plan remain outstanding and effective. The shares of common stock underlying any awards that are forfeited, canceled, repurchased, expire or are otherwise terminated (other than by exercise) under the 2002 Plan and 2010 Plan are added to the shares of common stock available for issuance under the 2013 Plan. As of December 31, 2016, the total number of common stock that may be issued under all plans is 1.2 The Company does not currently hold any treasury shares. Upon stock option exercise, the Company issues new shares and delivers them to the participant. Stock-based compensation expense The Company recognized stock-based compensation expense totaling $39.8 million, $41.1 million, and $10.8 million during the years ended December 31, 2016, 2015 and 2014, respectively. Stock-based compensation expense recognized by award type is as follows (in thousands): Year ended December 31, 2016 2015 2014 Stock options $ 33,966 $ 37,536 $ 9,487 Restricted stock awards — — 52 Restricted stock units 5,374 3,325 1,158 Employee stock purchase plan 416 259 66 $ 39,756 $ 41,120 $ 10,763 Stock-based compensation expense by classification included within the consolidated statements of operations and comprehensive loss was as follows (in thousands): Year ended December 31, 2016 2015 2014 Research and development $ 19,690 $ 24,854 $ 5,151 General and administrative 20,066 16,266 5,612 $ 39,756 $ 41,120 $ 10,763 The fair value of each option issued to employees was estimated at the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions: Year ended December 31, 2016 2015 2014 Expected volatility 74.3 % 72.6 % 82.3 % Expected term (in years) 6.0 5.9 6.0 Risk-free interest rate 1.5 % 1.7 % 1.8 % Expected dividend yield 0.0 % 0.0 % 0.0 % The intrinsic value of options exercised during the years ended December 31, 2016, 2015, and 2014, was $15.3 million, $147.9 million and $41.4 million, respectively. The weighted-average fair values of options granted during 2016, 2015 and 2014 was $34.22, $74.65, and $18.53, respectively. There were no unvested restricted stock awards as of December 31, 2016 and 2015 and no restricted stock awards were granted during 2016. The aggregate fair value of restricted stock awards that vested during the year ended December 31, 2014, based on the estimated fair value of the underlying stock on the day of vesting was $1.9 million. As of December 31, 2016, there was $69.5 million, $11.9 million and $0.1 million of unrecognized compensation expense related to unvested stock options, restricted stock units and the employee stock purchase plan, respectively, that is expected to be recognized over a weighted-average period of 2.5, 2.8, and 0.1 years. In 2015, the Company modified outstanding options held by its former Chief Scientific Officer as part of his separation agreement, modified the vesting conditions of a stock option award held by a non-employee founder, and modified the vesting conditions of stock option awards held by two employees immediately following their separation from the Company. As a result of these modifications, the Company recognized $10.3 million of incremental stock-based compensation expense during 2015. During the year ended December 31, 2014, the Company modified the vesting conditions of stock option awards held by several former employees, which resulted in $0.6 million of incremental expense recognized within general and administrative expenses. Stock options The following table summarizes the stock option activity under the Company’s equity awards plans (shares and aggregate intrinsic value in thousands): Shares Weighted-average exercise price per share Weighted-average contractual life (in years) Aggregate intrinsic value (a) (in Outstanding at December 31, 2015 3,532 $ 48.74 Granted 1,047 $ 52.09 Exercised (377 ) $ 16.30 Canceled or forfeited (467 ) $ 55.04 Outstanding at December 31, 2016 3,735 $ 52.17 7.5 $ 93,081 Exercisable at December 31, 2016 1,926 $ 39.23 6.5 $ 70,991 Vested and expected to vest at December 31, 2016 3,735 $ 52.17 7.5 $ 93,081 (a) 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 December 31, 2016. Restricted stock units The following table summarizes the restricted stock unit activity under the Company’s equity award plans (shares in thousands): Shares Weighted-average grant date fair value Unvested balance at December 31, 2015 148 $ 65.79 Granted 263 52.12 Vested (113 ) 46.17 Forfeited (35 ) 46.65 Unvested balance at December 31, 2016 263 $ 63.07 Employee Stock Purchase Plan On June 3, 2013, the Company’s board of directors adopted its 2013 Employee Stock Purchase Plan (“2013 ESPP”), which was subsequently approved by its stockholders and became effective upon the closing of the Company’s IPO on June 24, 2013. The 2013 ESPP authorizes the initial issuance of up to a total of 238,000 shares of the Company’s common stock to participating employees. The first offering period under the 2013 ESPP opened on August 1, 2014. During the years ended December 31, 2016 and 2015, 18,338 |
401(k) Savings Plan
401(k) Savings Plan | 12 Months Ended |
Dec. 31, 2016 | |
Compensation And Retirement Disclosure [Abstract] | |
401(k) Savings Plan | 13. 401(k) Savings plan In 1997, the Company established a defined-contribution savings plan under Section 401(k) of the Internal Revenue Code (“the 401(k) Plan”). The 401(k) Plan covers all employees who meet defined minimum age and service requirements, and allows participants to defer a portion of their annual compensation on a pretax basis. The Company did not make any contributions to the 401(k) Plan through December 31, 2014. In February 2017 and 2016, the Company made contributions of approximately $1.0 million and $0.6 million, respectively, related to employee contributions made during 2016 and 2015, which is included in accrued expenses and other current liabilities as of December 31, 2016 and 2015. |
Income taxes
Income taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income taxes | 14. Income taxes The components of loss before income taxes were as follows (in thousands): Year ended December 31, 2016 2015 2014 U.S. $ (210,188 ) $ (162,287 ) $ (61,118 ) Foreign (53,931 ) (4,436 ) 612 Total $ (264,119 ) $ (166,723 ) $ (60,506 ) The (benefit from) provision for income taxes were as follows (in thousands): Year ended December 31, 2016 2015 2014 Current Federal $ — $ — $ — State — — 1 Foreign — 60 — Deferred Federal (588 ) — (9,390 ) State (24 ) — (2,408 ) Foreign — — — Total income tax expense (benefit) $ (612 ) $ 60 $ (11,797 ) A reconciliation of income tax (benefit) provision computed at the statutory federal income tax rate to the Company’s effective income tax rate (benefit) provision as reflected in the financial statements is as follows: Year ended December 31, 2016 2015 2014 Federal income tax expense at statutory rate 34.0 % 34.0 % 34.0 % State income tax, net of federal benefit 3.3 % 4.2 % 4.0 % Permanent differences (5.3 %) (6.4 %) (3.2 %) Research and development credit 15.0 % 14.6 % 25.7 % Foreign differential (7.0 %) (1.0 %) 0.0 % Other 0.0 % (0.5 %) 0.0 % Change in valuation allowance (39.9 %) (44.9 %) (41.0 %) Effective income tax rate benefit 0.1 % 0.0 % 19.5 % For the years ended December 31, 2016, 2015 and 2014, the Company recognized an income tax benefit (expense) of $0.6 million or 0.1%, $(0.1) million or 0.0% and $11.8 million or 19.5%, respectively. In 2014, the Company recorded a non-recurring tax benefit of $11.8 million due to the release of a portion of the valuation allowance due to taxable temporary differences available as a source of income to realize certain pre-existing deferred tax assets as a result of the acquisition of Pregenen. Excluding the impact of this item, the Company’s overall tax provision and effective tax rate would have been zero. The Company did not recognize any significant tax benefit for the years ended December 31, 2016 and December 31, 2015 as the Company was subject to a full valuation allowance. Deferred taxes are recognized for temporary differences between the basis of assets and liabilities for financial statement and income tax purposes. The significant components of the Company’s deferred tax assets and liabilities are comprised of the following (in thousands): Year ended December 31, 2016 2015 Deferred tax assets: U.S. net operating loss carryforwards $ 106,064 $ 62,844 Foreign net operating loss carryforwards — 194 Tax credit carryforwards 87,117 47,386 Capitalized research and development expenses, net 631 979 Capital lease 47,191 24,315 Deferred revenue 18,231 16,438 Capitalized license fees 11,752 5,488 Accruals and other 32,172 19,486 Total deferred tax assets 303,158 177,130 Intangible assets (8,129 ) (9,606 ) Fixed assets (48,902 ) (26,681 ) Less valuation allowance (246,127 ) (140,843 ) Net deferred taxes $ — $ — A valuation allowance is recorded against deferred tax assets if it is more likely than not that some or all of the deferred tax assets will not be realized. Due to the uncertainty surrounding the realization of the favorable tax attributes in future tax returns, the Company has recorded a full valuation allowance against the Company’s otherwise recognizable net deferred tax assets. The valuation allowance increased on a net basis by approximately $105.3 million during the year ended December 31, 2016 due primarily to net operating losses and tax credit carryforwards. As of December 31, 2016, 2015 and 2014, the Company had U.S. federal net operating loss carryforwards of approximately $466.8 million, $347.5 million, and $130.0 million, respectively, which may be available to offset future income tax liabilities and expire at various dates through 2036. As of December 31, 2016, 2015 and 2014, the Company also had U.S. state net operating loss carryforwards of approximately $456.8 million, $335.0 million, and $115.5 million, respectively, which may be available to offset future income tax liabilities and expire at various dates through 2036. At December 31, 2016, $195.4 million and $195.4 million of federal and state net operating losses, respectively, relate to excess equity based compensation tax deductions, the benefits for which will be recorded to additional paid-in capital when recognized through a reduction of cash taxes paid. At December 31, 2016, 2015 and 2014, the Company also had approximately $0.0 million, $0.6 million, and $2.7 million, respectively, of foreign net operating loss carryforwards that may be available to offset future income tax liabilities; these carryforwards do not expire. As of December 31, 2016, 2015 and 2014, the Company had federal research and development and orphan drug tax credit carryforwards of approximately $83.2 million, $44.9 million, and $22.0 million, respectively, available to reduce future tax liabilities which expire at various dates through 2036. As of December 31, 2016, 2015 and 2014, the Company had state credit carryforwards of approximately $6.0 million, $3.8 million, and $2.0 million, respectively, available to reduce future tax liabilities which expire at various dates through 2031. Under the provisions of the Internal Revenue Code, the net operating loss and tax credit carryforwards are subject to review and possible adjustment by the Internal Revenue Service and state tax authorities. Net operating loss and tax credit carryforwards may become subject to an annual limitation in the event of certain cumulative changes in the ownership interest of significant shareholders over a three-year period in excess of 50 percent, as defined under Sections 382 and 383 of the Internal Revenue Code, respectively, as well as similar state provisions. This could limit the amount of tax attributes that can be utilized annually to offset future taxable income or tax liabilities. The amount of the annual limitation is determined based on the value of the Company immediately prior to the ownership change. Subsequent ownership changes may further affect the limitation in future years. The Company has completed several financings since its inception which it believes has resulted in a change in control as defined by Sections 382 and 383 of the Internal Revenue Code. The Company will recognize interest and penalties related to uncertain tax positions in income tax expense. As of December 31, 2016, 2015 and 2014, the Company had no significant accrued interest or penalties related to uncertain tax positions and no significant amounts have been recognized in the Company’s consolidated statements of operations and comprehensive income (loss). For all years through December 31, 2016, the Company generated research credits but has not conducted a study to document the qualified activities. This study may result in an adjustment to the Company’s research and development credit carryforwards; however, until a study is completed and any adjustment is known, no amounts are being presented as an uncertain tax position. A full valuation allowance has been provided against the Company’s research and development credits and, if an adjustment is required, this adjustment would be offset by an adjustment to the deferred tax asset established for the research and development credit carryforwards and the valuation allowance. The Company or one of its subsidiaries files income tax returns in the United States, and various state and foreign jurisdictions. The federal, state and foreign 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, state or foreign tax authorities to the extent utilized in a future period. |
Net loss per share
Net loss per share | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Net loss per share | 15. Net loss per share The following common stock equivalents were excluded from the calculation of diluted net loss per share for the periods indicated because including them would have had an anti-dilutive effect (in thousands): Year ended December 31, 2016 2015 2014 Warrants — — 177 Outstanding stock options 3,735 3,532 3,652 Restricted stock units 263 148 179 ESPP shares 11 3 6 Acquisition holdback — — 94 4,009 3,683 4,108 |
Selected quarterly financial da
Selected quarterly financial data (Unaudited) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Selected quarterly financial data (Unaudited) | 16. Selected Quarterly Financial Data (Unaudited) The following table contains quarterly financial information for 2016 and 2015. The Company believes that the following information reflects all normal recurring adjustments necessary for a fair presentation of the information for the periods presented. The operating results for any quarter are not necessarily indicative of results for any future period. 2016 First Quarter Second Quarter Third Quarter Fourth Quarter Total (in thousands, except per share data) Total revenue $ 1,499 $ 1,552 $ 1,552 $ 1,552 $ 6,155 Total operating expenses 58,879 61,527 79,692 73,887 273,985 Loss from operations (57,380 ) (59,975 ) (78,140 ) (72,335 ) (267,830 ) Net loss (56,274 ) (58,844 ) (77,025 ) (71,364 ) (263,507 ) Net loss per share applicable to common stockholders - basic and diluted $ (1.52 ) $ (1.59 ) $ (2.07 ) $ (1.88 ) $ (7.07 ) 2015 First Quarter Second Quarter Third Quarter Fourth Quarter Total (in thousands, except per share data) Total revenue $ 6,344 $ 4,940 $ 1,324 $ 1,471 $ 14,079 Total operating expenses 31,270 56,963 44,451 50,432 183,116 Loss from operations (24,926 ) (52,023 ) (43,127 ) (48,961 ) (169,037 ) Net loss (24,787 ) (51,795 ) (42,924 ) (47,277 ) (166,783 ) Net loss per share applicable to common stockholders - basic and diluted $ (0.76 ) $ (1.57 ) $ (1.18 ) $ (1.29 ) $ (4.81 ) |
Subsequent events
Subsequent events | 12 Months Ended |
Dec. 31, 2016 | |
Subsequent Events [Abstract] | |
Subsequent events | 17. Subsequent events The Company has evaluated all events or transactions that occurred after December 31, 2016. In the judgment of management, there were no material events that impacted the consolidated financial statements or disclosures. |
Summary of significant accoun26
Summary of significant accounting policies and basis of presentation (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Basis of presentation and principles of consolidation | Basis of presentation and principles of consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries: Precision Genome Engineering, Inc., bluebird bio France – SARL, bluebird bio Australia Pty Ltd., bluebird bio (Bermuda) Ltd., bluebird bio (UK) Ltd., and bluebird bio Securities Corporation. All intercompany balances and transactions have been eliminated in consolidation. The assets acquired and liabilities assumed in connection with the Company’s acquisition of Pregenen were recorded at their fair values as of June 30, 2014, the date of the acquisition, and the operating results of Pregenen have been consolidated with those of the Company from the date of acquisition. These 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”). Certain aggregations of prior year amounts have been made to conform to current year presentation. In the prior year statement of operations and comprehensive income (loss), interest income, net and other income (expense), net are included within other income, net. |
Foreign currency transaction | Foreign currency translation The Company’s consolidated financial statements are prepared in U.S. dollars. The Company’s foreign subsidiaries use the U.S. dollar as their functional currency and maintains records in the local currency. Nonmonetary assets and liabilities are re-measured at historical rates and monetary assets and liabilities are re-measured at exchange rates in effect at the end of the reporting period. Income statement accounts are re-measured at average exchange rates for the reporting period. The resulting gains or losses are included in other income (expense), net in the consolidated statements of operations and comprehensive income (loss). |
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 in the financial statements and accompanying notes. Actual results could materially differ from those estimates. 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 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 financial statements. Estimates are used in the following areas, among others: acquisition-date fair value and subsequent fair value estimates used to assess potential impairment of long-lived assets, including goodwill and intangible assets, construction financing lease obligations, contingent consideration, stock-based compensation expense, accrued expenses, revenue and income taxes. |
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 views its operations and manages its business in one operating segment. All material long-lived assets of the Company reside in the United States. |
Cash and cash equivalents | Cash and cash equivalents The Company considers all highly liquid investments purchased with original final maturities of three months or less from the date of purchase to be cash equivalents. Cash and cash equivalents comprise funds in cash, money market accounts, U.S. Treasury securities and federally insured deposits. Cash equivalents are reported at fair value. |
Marketable securities | Marketable securities The Company classifies marketable securities with a remaining maturity when purchased of greater than three months as available-for-sale. Marketable securities with a remaining maturity date greater than one year are classified as non-current. Available-for-sale securities are maintained by an investment manager and consist of U.S. Treasury securities, U.S. government agency securities, and certificates of deposit. Available-for-sale securities are carried at fair value with the unrealized gains and losses included in other comprehensive income (loss) as a component of stockholders’ equity until realized. Any premium or discount arising at purchase is amortized and/or accreted to interest income and/or expense over the life of the instrument. Realized gains and losses are determined using the specific identification method and are included in other income (expense), net. If any adjustment to fair value reflects a decline in value of the investment, the Company considers all available evidence to evaluate the extent to which the decline is “other-than-temporary” and, if so, marks the investment to market through a charge to the Company’s statement of operations and comprehensive income (loss). |
Concentrations of credit risk and off-balance sheet risk | Concentrations of credit risk and off-balance sheet risk Financial instruments that subject the Company to credit risk primarily consist of cash and cash equivalents and available-for-sale securities. The Company maintains its cash and cash equivalent balances with high-quality financial institutions and, consequently, the Company believes that such funds are subject to minimal credit risk. The Company’s available-for-sale investments primarily consist of U.S. Treasury securities, U.S. government agency securities and certificates of deposit, and potentially subject the Company to concentrations of credit risk. The Company has adopted an investment policy which limits the amounts the Company may invest in any one type of investment and requires all investments held by the Company to be at least AA+/Aa1 rated, thereby reducing credit risk exposure. |
Fair value of financial instruments | Fair value of financial instruments The Company is required to disclose information on all assets and liabilities reported at fair value that enables an assessment of the inputs used in determining the reported fair values. FASB ASC Topic 820, Fair Value Measurements and Disclosures (“ASC 820”), establishes a hierarchy of inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the asset or liability, and are developed based on the best information available in the circumstances. The fair value hierarchy applies only to the valuation inputs used in determining the reported fair value of the investments and is not a measure of the investment credit quality. The three levels of the fair value hierarchy are described below: Level 1—Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Level 2—Valuations based on quoted prices for similar assets or liabilities in markets that are not active or for which all significant inputs are observable, either directly or indirectly. Level 3—Valuations that require inputs that reflect the Company’s own assumptions that are both significant to the fair value measurement and unobservable. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Items measured at fair value on a recurring basis include marketable securities (Note 3 and Note 4) and contingent consideration (Note 4). The carrying amounts of accounts payable and accrued expenses approximate their fair values due to their short-term maturities. |
Business combinations | Business combinations On June 30, 2014, the Company completed its acquisition of Pregenen for total consideration of $31.0 million, consisting of cash consideration of $5.1 million, common stock consideration of $19.3 million and contingent consideration with an estimated fair value of $6.6 million on the date of purchase. The estimated fair value of the contingent consideration is based upon significant assumptions regarding probabilities of successful achievement of related milestones, the estimated timing in which the milestones are achieved and discount rates. The estimated fair value could materially differ from actual values or fair values determined using different assumptions. See Note 4, “Fair value measurements,” for additional information. This transaction was accounted for as a business combination under the acquisition method of accounting. Accordingly, the tangible assets and identifiable intangible assets acquired and liabilities assumed were recorded at fair value as of the date of acquisition, with the excess purchase price recorded as goodwill. The estimated fair values of acquired assets and assumed liabilities were determined using the methods discussed in the following paragraphs and require significant judgment and estimates, which could materially differ from actual values and fair values determined using different methods or assumptions. |
Goodwill | Goodwill Goodwill represents the excess of the purchase price over the fair value of the net assets acquired when accounted for using the acquisition method of accounting for business combinations. Goodwill is not amortized but is evaluated for impairment within the Company’s single reporting unit on an annual basis, during the fourth quarter, or more frequently if an event occurs or circumstances change that would more-likely-than-not reduce the fair value of the Company’s reporting unit below its carrying amount. The Company has not recognized any impairment charges related to goodwill. |
Intangible assets | Intangible assets Intangible assets consist of acquired core technology with finite lives. The Company amortizes its intangible assets using the straight-line method over their estimated economic lives. The Company evaluates the potential impairment of intangible assets if events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable or that the useful lives of these assets are no longer appropriate. The impairment test is based on a comparison of the undiscounted cash flows expected to be generated from the use of the asset group and its eventual disposition to the carrying value of the asset group. If impairment is indicated, the asset is written down by the amount by which the carrying value of the asset exceeds the related fair value of the asset. The Company has not recognized an impairment charge related to intangible assets. |
Contingent consideration | Contingent consideration Each reporting period, the Company revalues the contingent consideration obligations associated with business combinations to their fair value and records within operating expenses increases in their fair value as contingent consideration expense and decreases in the fair value as contingent consideration income. Changes in contingent consideration result from changes in the assumptions regarding probabilities of successful achievement of related milestones, the estimated timing in which the milestones are achieved and the discount rate used to estimate the fair value of the liability. Contingent consideration may change significantly as development of the Company’s programs in certain indications progress and additional data are obtained, impacting the Company’s assumptions. The assumptions used in estimating fair value require significant judgment. The use of different assumptions and judgments could result in a materially different estimate of fair value. See Note 4, “Fair value measurements,” for additional information. |
Property and equipment | Property and equipment Property and equipment is stated at cost. Maintenance and repairs that do not improve or extend the lives of the respective assets are expensed to operations as incurred. Upon disposal, the related cost and accumulated depreciation is removed from the accounts and any resulting gain or loss is included in the results of operations. Depreciation and amortization is calculated using the straight-line method over the estimated useful lives of the assets, which are as follows: Asset Estimated useful life Computer equipment and software 3 years Office and laboratory equipment 2 -5 years Leasehold improvements Shorter of the useful life or remaining lease term The Company records certain estimated construction costs incurred and reported by a landlord as an asset and corresponding construction financing lease obligation on the consolidated balance sheets. See Note 8, “Commitments and contingencies,” for additional information. |
Impairment of long-lived assets | Impairment of long-lived assets The Company reviews long-lived assets when events or changes in circumstances indicate the carrying value of the assets may not be recoverable. Recoverability is measured by comparison of the book values of the assets to future net undiscounted cash flows that the assets are expected to generate. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the book value of the assets exceed their fair value, which is measured based on the projected discounted future net cash flows arising from the assets. No impairment losses have been recorded during the years ended December 31, 2016, 2015 and 2014. |
Construction financing lease obligation | Construction financing lease obligation Beginning in 2015 and until expected construction completion in 2017, the Company records certain |
Revenue recognition | Revenue recognition The Company has primarily generated revenue through collaboration arrangements, research arrangements and license arrangements with strategic partners and nonprofit organizations for the development and commercialization of product candidates. Additionally, the Company has generated revenue from research and development grant programs. The Company recognizes revenue in accordance with FASB ASC Topic 605, Revenue Recognition (“ASC 605”). Accordingly, revenue is recognized for each unit of accounting when all of the following criteria are met: • Persuasive evidence of an arrangement exists • Delivery has occurred or services have been rendered • The seller’s price to the buyer is fixed or determinable • Collectability is reasonably assured Amounts received prior to satisfying the revenue recognition criteria are recorded as deferred revenue in the Company’s consolidated balance sheets. Amounts expected to be recognized as revenue within the 12 months following the balance sheet date are classified as deferred revenue, current portion. Amounts not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as deferred revenue, net of current portion. |
Collaboration revenue | Collaboration revenue As of December 31, 2016, the Company’s collaboration revenue is generated exclusively from its collaboration arrangement with Celgene Corporation (“Celgene”), which was originally entered into in March 2013 and was subsequently amended in June 2015 (the “Amended Collaboration Agreement”). The amended terms of this arrangement contain multiple deliverables, which include at inception: (i) research and development services, (ii) participation on a joint steering committee (“JSC”), (iii) participation on the patent committee, (iv) a license to the first product candidate, (v) manufacture of vectors and associated payload for incorporation into the first optioned product candidate under the license, and (vi) participation on a joint governance committee (“JGC”) under the co-development and co-promotion agreement for the first optioned product candidate under the license. In connection with the Amended Collaboration Agreement, the Company received an upfront, one-time, non-refundable, non-creditable payment of $25.0 million to fund research and development under the collaboration. Other non-refundable payments to the Company under this arrangement may include: (i) product candidate license fees, (ii) payments in the event the Company does not exercise its option to co-develop and co-promote in the United States, (iii) payments for the manufacture and supply of vectors and payloads, (iv) payments based on the achievement of certain clinical, regulatory, and commercials milestones and (v) royalties on product sales. The Company analyzes multiple-element arrangements based on the guidance in FASB ASC Topic 605-25, Revenue Recognition-Multiple-Element Arrangements (“ASC 605-25”). Pursuant to the guidance in ASC 605-25, the Company evaluates multiple-element arrangements to determine (1) the deliverables included in the arrangement and (2) whether the individual deliverables represent separate units of accounting or whether they must be accounted for as a combined unit of accounting. This evaluation involves subjective determinations and requires management to make judgments about the individual deliverables and whether such deliverables are separable from the other aspects of the contractual relationship. Deliverables are considered separate units of accounting provided that: (i) the delivered item(s) has value to the customer on a standalone basis and (ii) if the arrangement includes a general right of return relative to the delivered item(s), delivery or performance of the undelivered item(s) is considered probable and substantially in the control of the Company. In assessing whether an item has standalone value, the Company considers factors such as the research, manufacturing and commercialization capabilities of the collaboration partner and the availability of the associated expertise in the general marketplace. In addition, the Company considers whether the collaboration partner can use the other deliverable(s) for their intended purpose without the receipt of the remaining element(s), whether the value of the deliverable is dependent on the undelivered item(s) and whether there are other vendors that can provide the undelivered element(s). The Company’s collaboration arrangement does not contain a general right of return relative to the delivered item(s). Arrangement consideration that is fixed or determinable is allocated among the separate units of accounting using the relative selling price method. Then, the applicable revenue recognition criteria in ASC 605-25 are applied to each of the separate units of accounting in determining the appropriate period and pattern of recognition. The Company determines the selling price of a unit of accounting following the hierarchy of evidence prescribed by ASC 605-25. Accordingly, the Company determines the estimated selling price for units of accounting within each arrangement using vendor-specific objective evidence (“VSOE”) of selling price, if available, third-party evidence (“TPE”) of selling price if VSOE is not available, or best estimate of selling price (“BESP”) if neither VSOE nor TPE is available. The Company typically uses BESP to estimate the selling price, since it generally does not have VSOE or TPE of selling price for its units of accounting. Determining the BESP for a unit of accounting requires significant judgment. In developing the BESP for a unit of accounting, the Company considers applicable market conditions and relevant entity-specific factors, including factors that were contemplated in negotiating the agreement with the customer and estimated costs. The Company validates the BESP for units of accounting by evaluating whether changes in the key assumptions used to determine the BESP will have a significant effect on the allocation of arrangement consideration between multiple units of accounting. Options are considered substantive if, at the inception of the arrangement, the Company is at risk as to whether the collaboration partner will choose to exercise the option. Factors that the Company considers in evaluating whether an option is substantive include the overall objective of the arrangement, the benefit the collaborator might obtain from the arrangement without exercising the option, the cost to exercise the option and the likelihood that the option will be exercised. For arrangements under which an option is considered substantive, the Company does not consider the item underlying the option to be a deliverable at the inception of the arrangement and the associated option fees are not included in allocable arrangement consideration, assuming the option is not priced at a significant and incremental discount. Conversely, for arrangements under which an option is not considered substantive or if an option is priced at a significant and incremental discount, the Company would consider the item underlying the option to be a deliverable at the inception of the arrangement and a corresponding amount would be included in allocable arrangement consideration. At execution of the Amended Collaboration Agreement, one of the options was determined not to be substantive and any other options were determined to be substantive. The Company recognizes arrangement consideration allocated to each unit of accounting when all of the revenue recognition criteria in ASC 605-25 are satisfied for that particular unit of accounting. The Company will recognize as revenue arrangement consideration attributed to licenses that have standalone value from the other deliverables to be provided in an arrangement upon delivery. The Company will recognize as revenue arrangement consideration attributed to licenses that do not have standalone value from the other deliverables to be provided in an arrangement over the Company’s estimated performance period as the arrangement would be accounted for as a single unit of accounting. The Company recognizes revenue from the Celgene arrangement associated research and development services, joint steering committee services and patent committee services ratably over the associated period of performance, which is initially estimated to be three years. If there is no discernible pattern of performance and/or objectively measurable performance measures do not exist, then the Company recognizes revenue under the arrangement on a straight-line basis over the period the Company is expected to complete its performance obligations. Conversely, if the pattern of performance in which the service is provided to the customer can be determined and objectively measurable performance measures exist, then the Company recognizes revenue under the arrangement using the proportional performance method. Revenue recognized is limited to the lesser of the cumulative amount of payments received or the cumulative amount of revenue earned, as determined using the straight-line method or proportional performance method, as applicable, as of the period ending date. At the inception of an arrangement that includes milestone payments, the Company evaluates whether each milestone is substantive and at risk to both parties on the basis of the contingent nature of the milestone. This evaluation includes an assessment of whether: (i) the consideration is commensurate with either the Company’s performance to achieve the milestone or the enhancement of the value of the delivered item(s) as a result of a specific outcome resulting from the Company’s performance to achieve the milestone, (ii) the consideration relates solely to past performance and (iii) the consideration is reasonable relative to all of the deliverables and payment terms within the arrangement. The Company evaluates factors such as the scientific, clinical, regulatory, commercial and other risks that must be overcome to achieve the respective milestone and the level of effort and investment required to achieve the respective milestone in making this assessment. There is considerable judgment involved in determining whether a milestone satisfies all of the criteria required to conclude that a milestone is substantive. The Company has concluded that all of the clinical and regulatory milestones pursuant to its collaboration arrangement are substantive. Accordingly, in accordance with FASB ASC Topic 605-28, Revenue Recognition-Milestone Method, revenue from clinical and regulatory milestone payments will be recognized in its entirety upon successful accomplishment of the milestone, assuming all other revenue recognition criteria are met. Milestones that are not considered substantive would be recognized as revenue over the remaining period of performance, assuming all other revenue recognition criteria are met. All commercial milestones will be accounted for in the same manner as royalties and recorded as revenue upon achievement of the milestone, assuming all other revenue recognition criteria are met. The Company will recognize royalty revenue in the period of sale of the related product(s), based on the underlying contract terms, provided that the reported sales are reliably measurable and the Company has no remaining performance obligations, assuming all other revenue recognition criteria are met. |
Research fees and license fees | Research fees and license fees The terms of the Company’s research agreements and license agreements have previously included delivery of an intellectual property license or the performance of research and development activities. The Company does not have any material research arrangements or license arrangements that contain multiple deliverables. The Company is compensated under research arrangements and license arrangements through nonrefundable up-front payments and future royalties on net product sales. Research fees are recognized as revenue on a straight-line basis over the period that the research services are expected to be performed unless the Company’s pattern of performance can be determined to be other than straight-line, in which case, the Company uses the proportional performance method. Nonrefundable license fees are recognized as revenue upon delivery provided there are no undelivered elements in the arrangement. |
Research and development expenses | Research and development expenses Research and development costs are charged to expense as costs are incurred in performing research and development activities, including salaries and benefits, facilities costs, overhead costs, clinical study and related clinical manufacturing costs, contract services and other related costs. Research and development costs, including up-front fees and milestones paid to collaborators, are also expensed as incurred. In circumstances where amounts have been paid in excess of costs incurred, the Company records a prepaid expense. |
Stock-based compensation | Stock-based compensation The Company accounts for its stock-based compensation awards in accordance with FASB ASC Topic 718, Compensation—Stock Compensation (“ASC 718”). ASC 718 requires all stock-based payments to employees, including grants of employee stock options and restricted stock units and modifications to existing stock options, to be recognized in the consolidated statements of operations and comprehensive income (loss) based on their fair values. The Company uses the Black-Scholes option pricing model to determine the fair value of options granted. The Company’s stock-based awards are subject to either service or performance-based vesting conditions. Compensation expense related to awards to employees and directors with service-based vesting conditions is recognized on a straight-line basis based on the grant date fair value over the associated service period of the award, which is generally the vesting term. Compensation expense related to awards to non-employees with service-based vesting conditions is recognized based on the then-current fair value at each financial reporting date prior to the measurement date over the associated service period of the award, which is generally the vesting term, using the accelerated attribution method. Compensation expense related to awards to employees with performance-based vesting conditions is recognized based on the grant date fair value over the requisite service period using the accelerated attribution method to the extent achievement of the performance condition is probable. Compensation expense related to awards to non-employees with performance-based vesting conditions is recognized based on the then-current fair value at each financial reporting date prior to the measurement date over the requisite service period using the accelerated attribution method to the extent achievement of the performance condition is probable. The Company expenses restricted stock unit awards to employees based on the fair value of the award on a straight-line basis over the associated service period of the award. Awards of restricted stock units to non-employees are adjusted through stock-based compensation expense at each reporting period end to reflect the current fair value of such awards and expensed using an accelerated attribution model. The Company estimates the fair value of its option awards to employees and directors using the Black-Scholes option pricing model, which requires the input of and subjective assumptions, including (i) the expected stock price volatility, (ii) the calculation of expected term of the award, (iii) the risk-free interest rate, and (iv) expected dividends. Due to the lack of company specific historical and implied volatility data of its common stock, the Company has based its estimate of expected volatility on the historical volatility of a group of similar companies that are publicly traded. When selecting these public companies on which it has based its expected stock price volatility, the Company selected companies with comparable characteristics to it, including enterprise value, risk profiles, position within the industry, and with historical share price information sufficient to meet the expected term of the stock-based awards. The Company computes historical volatility data using the daily closing prices for the selected companies’ shares during the equivalent period of the calculated expected term of the stock-based awards. The Company will continue to apply this process until a sufficient amount of historical information regarding the volatility of its own stock price becomes available, which is expected in 2017. The Company has estimated the expected term of its employee stock options using the “simplified” method, whereby, the expected term equals the arithmetic average of the vesting term and the original contractual term of the option due to its lack of sufficient historical data. The risk-free interest rates for periods within the expected term of the option are based on the U.S. Treasury securities with a maturity date commensurate with the expected term of the associated award. The Company has never paid, and does not expect to pay dividends in the foreseeable future. The Company is also required to estimate forfeitures at the time of grant, and revise those estimates in subsequent periods if actual forfeitures differ from its estimates. The Company uses historical data to estimate pre-vesting option forfeitures and records stock-based compensation expense only for those awards that are expected to vest. To the extent that actual forfeitures differ from the Company’s estimates, the differences are recorded as a cumulative adjustment in the period the estimates were revised. Stock-based compensation expense recognized in the financial statements is based on awards that are ultimately expected to vest. Consistent with the guidance in FASB ASC Topic 505-50, Equity-Based Payments to Non-Employees, the fair value of each non-employee stock option and warrant award is estimated at the date of grant using the Black-Scholes option pricing model with assumptions generally consistent with those used for employee stock options, with the exception of expected term, which is over the contractual life. |
Other income, net | Other income, net Other income, net consists primarily of interest income earned on investments, net of amortization of premium and accretion of discount. Other income, net also includes foreign currency gains or losses and tax incentives from the Massachusetts Life Sciences Center. |
Net loss per share | Net loss per share Basic net loss per share is calculated by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding during the period. Diluted net income per share is calculated by dividing the net income attributable to common stockholders by the weighted-average number of common equivalent shares outstanding for the period, including any dilutive effect from outstanding stock options, unvested restricted stock, restricted stock units, and employee stock purchase plan stock using the treasury stock method. The Company follows the two-class method when computing net income (loss) per share in periods when issued shares that meet the definition of participating securities are outstanding. The two-class method determines net income (loss) per share for each class of common and participating securities according to dividends declared or accumulated and participation rights in undistributed earnings. The two-class method requires income available to common stockholders for the period to be allocated between common and participating securities based upon their respective rights to received dividends as if all income for the period had been distributed. Accordingly, in periods in which the Company reports a net loss attributable to common stockholders when participating securities are outstanding, losses are not allocated to the participating securities. |
Income taxes | Income taxes Income taxes are recorded in accordance with FASB ASC Topic 740, Income Taxes (“ASC 740”), which provides for deferred taxes using an asset and liability approach. The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Valuation allowances are provided, if based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. 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 December 31, 2016 and 2015, the Company does not have any significant uncertain tax positions. |
Comprehensive income (loss) | Comprehensive income (loss) Comprehensive income (loss) is comprised of net loss and other comprehensive income or loss. Other comprehensive income (loss) consists of unrealized gains and losses on marketable securities. |
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. |
Recent accounting pronouncements | Recent accounting pronouncements 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 on January 1, 2018 and earlier application is permitted only for annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. Topic 606 allows for either a full retrospective adoption, in which the standard is applied to all of the 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 December 31, 2016, revenue is generated exclusively from the Company’s collaboration arrangement with Celgene. The Company In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements – Going Concern (“ASU 2014-15”), which requires a company to evaluate the existence of conditions or events that raise substantial doubt about its ability to continue as a going concern within one year of the issuance date of its financial statements. The standard is effective for interim and annual periods ending after December 15, 2016 with early adoption permitted. The standard did not have a material impact on the Company’s consolidated financial statements or footnote disclosures as of the December 31, 2016 adoption date, but may require additional disclosures in future periods. In February 2016, the FASB issued ASU 2016-02, Leases , (“ASU 2016-02”) , which requires a lessee to recognize assets and liabilities on the balance sheet for operating leases and changes many key definitions, including the definition of a lease. The new standard includes a short-term lease exception for leases with a term of 12 months or less, as part of which a lessee can make an accounting policy election not to recognize lease assets and lease liabilities. Lessees will continue to differentiate between finance leases (previously referred to as capital leases) and operating leases using classification criteria that are substantially similar to the previous guidance. The new standard will be effective beginning January 1, 2019, and early adoption is permitted for public entities. The Company is currently evaluating the potential impact ASU 2016-02 may have on its financial position and results of operations. In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting (“ASU No. 2016-09”), which simplifies share-based payment accounting through a variety of amendments. The new standard will be effective for the Company on January 1, 2017. The adoption of this standard is expected to impact income tax footnote disclosures only and is not expected to have a material impact on the Company’s consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments (“Topic 230”). The new standard clarifies certain aspects of the statement of cash flows, including the classification of contingent consideration payments made after a business combination, the clarification of restricted cash, and several clarifications not currently applicable to the Company. The new standard also clarifies that an entity should determine each separately identifiable source or use within the cash receipts and cash payments on the basis of the nature of the underlying cash flows. In situations in which cash receipts and payments have aspects of more than one class of cash flows and cannot be separated by source or use, the appropriate classification should depend on the activity that is likely to be the predominant source or use of cash flows for the item. The new standard will be effective for the Company on January 1, 2018. The adoption of this standard is not expected to have a material impact on the Company’s consolidated statements of cash flows upon adoption. |
Summary of significant accoun27
Summary of significant accounting policies and basis of presentation (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Estimated Useful Lives of Assets | Depreciation and amortization is calculated using the straight-line method over the estimated useful lives of the assets, which are as follows: Asset Estimated useful life Computer equipment and software 3 years Office and laboratory equipment 2 -5 years Leasehold improvements Shorter of the useful life or remaining lease term |
Marketable Securities (Tables)
Marketable Securities (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Investments Debt And Equity Securities [Abstract] | |
Summary of Available for Sale Securities Held | The following table summarizes the available-for-sale securities held at December 31, 2016 and 2015 (in thousands): Description Amortized Cost Unrealized Gains Unrealized Losses Fair Value December 31, 2016 U.S. government agency securities and treasuries $ 600,001 $ 34 $ (575 ) $ 599,460 Certificates of deposit 6,480 6 (3 ) 6,483 Total $ 606,481 $ 40 $ (578 ) $ 605,943 December 31, 2015 U.S. government agency securities and treasuries $ 689,425 $ 22 $ (2,300 ) $ 687,147 Certificates of deposit 14,360 — (13 ) 14,347 Total $ 703,785 $ 22 $ (2,313 ) $ 701,494 |
Fair value measurements (Tables
Fair value measurements (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Recorded Amount of Assets and Liabilities Measured at Fair Value on Recurring Basis | The following table sets forth the Company’s assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2016 and 2015 (in thousands): Description Total Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) December 31, 2016 Assets: Cash and cash equivalents $ 278,887 $ 278,887 $ — $ — Marketable securities: U.S. government agency securities and treasuries 599,460 — 599,460 — Certificates of deposit 6,483 — 6,483 — Total assets $ 884,830 $ 278,887 $ 605,943 $ — Liabilities: Contingent consideration $ 7,756 $ — $ — $ 7,756 Total liabilities $ 7,756 $ — $ — $ 7,756 December 31, 2015 Assets: Cash and cash equivalents $ 164,269 $ 158,269 $ 6,000 $ — Marketable securities: U.S. government agency securities 687,147 — 687,147 — Certificates of deposit 14,347 — 14,347 — Total assets $ 865,763 $ 158,269 $ 707,494 $ — Liabilities: Contingent consideration $ 8,665 $ — $ — $ 8,665 Total liabilities $ 8,665 $ — $ — $ 8,665 |
Roll-Forward of Fair Value of the Company's Contingent Consideration Obligations | The table below provides a roll-forward of fair value of the Company’s contingent consideration obligations which include Level 3 inputs (in thousands): Year ended December 31, 2016 2015 Beginning balance $ 8,665 $ 6,796 Additions — — Changes in fair value 4,091 2,869 Payments (5,000 ) (1,000 ) Ending balance $ 7,756 $ 8,665 |
Property and equipment, net (Ta
Property and equipment, net (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property Plant And Equipment [Abstract] | |
Property and equipment | Property and equipment, net, consists of the following (in thousands): December 31, 2016 2015 Computer equipment and software $ 1,655 $ 1,259 Office equipment 1,427 1,104 Laboratory equipment 16,305 10,520 Leasehold improvements 13,697 11,010 Construction-in-progress 136,315 65,542 Total property and equipment 169,399 89,435 Less accumulated depreciation and amortization (12,444 ) (6,821 ) Property and equipment, net $ 156,955 $ 82,614 |
Accrued expenses and other cu31
Accrued expenses and other current liabilities (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Payables And Accruals [Abstract] | |
Summary of Accrued Expenses and Other Current Liabilities | Accrued expenses and other current liabilities consist of the following (in thousands): December 31, 2016 2015 Employee compensation $ 11,296 $ 5,935 Accrued goods and services 34,275 15,876 Accrued license and milestone fees 2,464 277 Accrued professional fees 1,492 1,014 Deferred rent, current portion 11 964 Contingent consideration, current portion 4,479 3,584 Other 643 495 Total accrued expenses and other current liabilities $ 54,660 $ 28,145 |
Commitments and contingencies (
Commitments and contingencies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments And Contingencies Disclosure [Abstract] | |
Future Minimum Commitments | As of December 31, 2016, future minimum commitments under the 60 Binney Street Lease and facility operating leases were as follows (in thousands): Years ended December 31, 60 Binney Street Lease 150 Second Street Lease Other Operating Leases Total Lease Commitments 2017 $ 13,102 $ 1,359 $ 11,963 $ 26,424 2018 18,647 - 10,368 29,015 2019 18,974 - 9,841 28,815 2020 19,305 - 9,841 29,146 2021 19,643 - 9,841 29,484 2022 and thereafter 108,875 - 32,725 141,600 Total minimum lease payments $ 198,546 $ 1,359 $ 84,579 $ 284,484 (1) Amounts are subject to increase if the Company does not vacate the leased premise during the second quarter of 2017 as planned. |
Common stock and preferred st33
Common stock and preferred stock (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Summary of Future Issuance of Common Stock Shares | The Company has reserved for future issuance the following number of shares of common stock (in thousands): December 31, 2016 2015 Options to purchase common stock 3,735 3,532 Restricted stock units 263 148 2013 Stock Option and Incentive Plan 1,226 565 2013 Employee Stock Purchase Plan 209 227 5,433 4,472 |
Business combinations (Tables)
Business combinations (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Business Combinations [Abstract] | |
Estimated Amortization of Intangible Assets | The estimated amortization of intangible assets for the year ended December 31, 2016 and for each of the five succeeding years and thereafter is as follows (in thousands): 2017 $ 3,763 2018 3,763 2019 3,763 2020 3,763 2021 3,763 2022 1,879 Total $ 20,694 |
Stock-based compensation (Table
Stock-based compensation (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Summary of Stock-Based Compensation Expense by Award Type | Stock-based compensation expense recognized by award type is as follows (in thousands): Year ended December 31, 2016 2015 2014 Stock options $ 33,966 $ 37,536 $ 9,487 Restricted stock awards — — 52 Restricted stock units 5,374 3,325 1,158 Employee stock purchase plan 416 259 66 $ 39,756 $ 41,120 $ 10,763 |
Schedule of Stock-Based Compensation Expense by Classification | Stock-based compensation expense by classification included within the consolidated statements of operations and comprehensive loss was as follows (in thousands): Year ended December 31, 2016 2015 2014 Research and development $ 19,690 $ 24,854 $ 5,151 General and administrative 20,066 16,266 5,612 $ 39,756 $ 41,120 $ 10,763 |
Assumptions Used for the Black-Scholes Option-Pricing Model to Determine the Per Share Weighted Average Fair Value for Options Granted | The fair value of each option issued to employees was estimated at the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions: Year ended December 31, 2016 2015 2014 Expected volatility 74.3 % 72.6 % 82.3 % Expected term (in years) 6.0 5.9 6.0 Risk-free interest rate 1.5 % 1.7 % 1.8 % Expected dividend yield 0.0 % 0.0 % 0.0 % |
Summary of Stock Option Activity Under Plan | The following table summarizes the stock option activity under the Company’s equity awards plans (shares and aggregate intrinsic value in thousands): Shares Weighted-average exercise price per share Weighted-average contractual life (in years) Aggregate intrinsic value (a) (in Outstanding at December 31, 2015 3,532 $ 48.74 Granted 1,047 $ 52.09 Exercised (377 ) $ 16.30 Canceled or forfeited (467 ) $ 55.04 Outstanding at December 31, 2016 3,735 $ 52.17 7.5 $ 93,081 Exercisable at December 31, 2016 1,926 $ 39.23 6.5 $ 70,991 Vested and expected to vest at December 31, 2016 3,735 $ 52.17 7.5 $ 93,081 (a) 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 December 31, 2016. |
Restricted Stock Units [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Summary of Restricted Common Stock Awards | The following table summarizes the restricted stock unit activity under the Company’s equity award plans (shares in thousands): Shares Weighted-average grant date fair value Unvested balance at December 31, 2015 148 $ 65.79 Granted 263 52.12 Vested (113 ) 46.17 Forfeited (35 ) 46.65 Unvested balance at December 31, 2016 263 $ 63.07 |
Income taxes (Tables)
Income taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule Components of Loss Before Income Taxes | The components of loss before income taxes were as follows (in thousands): Year ended December 31, 2016 2015 2014 U.S. $ (210,188 ) $ (162,287 ) $ (61,118 ) Foreign (53,931 ) (4,436 ) 612 Total $ (264,119 ) $ (166,723 ) $ (60,506 ) |
Summary of (Benefit from) Provision for Income Taxes | The (benefit from) provision for income taxes were as follows (in thousands): Year ended December 31, 2016 2015 2014 Current Federal $ — $ — $ — State — — 1 Foreign — 60 — Deferred Federal (588 ) — (9,390 ) State (24 ) — (2,408 ) Foreign — — — Total income tax expense (benefit) $ (612 ) $ 60 $ (11,797 ) |
Reconciliation of Income Tax (Benefit) Provision Computed at the Statutory Federal Income Tax Rate to Effective Income Tax Rate (Benefit) Provision as Reflected in the Financial Statements | A reconciliation of income tax (benefit) provision computed at the statutory federal income tax rate to the Company’s effective income tax rate (benefit) provision as reflected in the financial statements is as follows: Year ended December 31, 2016 2015 2014 Federal income tax expense at statutory rate 34.0 % 34.0 % 34.0 % State income tax, net of federal benefit 3.3 % 4.2 % 4.0 % Permanent differences (5.3 %) (6.4 %) (3.2 %) Research and development credit 15.0 % 14.6 % 25.7 % Foreign differential (7.0 %) (1.0 %) 0.0 % Other 0.0 % (0.5 %) 0.0 % Change in valuation allowance (39.9 %) (44.9 %) (41.0 %) Effective income tax rate benefit 0.1 % 0.0 % 19.5 % |
Components of Deferred Tax Assets and Liabilities | The significant components of the Company’s deferred tax assets and liabilities are comprised of the following (in thousands): Year ended December 31, 2016 2015 Deferred tax assets: U.S. net operating loss carryforwards $ 106,064 $ 62,844 Foreign net operating loss carryforwards — 194 Tax credit carryforwards 87,117 47,386 Capitalized research and development expenses, net 631 979 Capital lease 47,191 24,315 Deferred revenue 18,231 16,438 Capitalized license fees 11,752 5,488 Accruals and other 32,172 19,486 Total deferred tax assets 303,158 177,130 Intangible assets (8,129 ) (9,606 ) Fixed assets (48,902 ) (26,681 ) Less valuation allowance (246,127 ) (140,843 ) Net deferred taxes $ — $ — |
Net loss per share (Tables)
Net loss per share (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Common Stock Equivalents Excluded from Calculation of Diluted Net Loss Per Share | The following common stock equivalents were excluded from the calculation of diluted net loss per share for the periods indicated because including them would have had an anti-dilutive effect (in thousands): Year ended December 31, 2016 2015 2014 Warrants — — 177 Outstanding stock options 3,735 3,532 3,652 Restricted stock units 263 148 179 ESPP shares 11 3 6 Acquisition holdback — — 94 4,009 3,683 4,108 |
Selected quarterly financial 38
Selected quarterly financial data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information | The following table contains quarterly financial information for 2016 and 2015. The Company believes that the following information reflects all normal recurring adjustments necessary for a fair presentation of the information for the periods presented. The operating results for any quarter are not necessarily indicative of results for any future period. 2016 First Quarter Second Quarter Third Quarter Fourth Quarter Total (in thousands, except per share data) Total revenue $ 1,499 $ 1,552 $ 1,552 $ 1,552 $ 6,155 Total operating expenses 58,879 61,527 79,692 73,887 273,985 Loss from operations (57,380 ) (59,975 ) (78,140 ) (72,335 ) (267,830 ) Net loss (56,274 ) (58,844 ) (77,025 ) (71,364 ) (263,507 ) Net loss per share applicable to common stockholders - basic and diluted $ (1.52 ) $ (1.59 ) $ (2.07 ) $ (1.88 ) $ (7.07 ) 2015 First Quarter Second Quarter Third Quarter Fourth Quarter Total (in thousands, except per share data) Total revenue $ 6,344 $ 4,940 $ 1,324 $ 1,471 $ 14,079 Total operating expenses 31,270 56,963 44,451 50,432 183,116 Loss from operations (24,926 ) (52,023 ) (43,127 ) (48,961 ) (169,037 ) Net loss (24,787 ) (51,795 ) (42,924 ) (47,277 ) (166,783 ) Net loss per share applicable to common stockholders - basic and diluted $ (0.76 ) $ (1.57 ) $ (1.18 ) $ (1.29 ) $ (4.81 ) |
Description of the business - A
Description of the business - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 12 Months Ended | |||
Dec. 31, 2016 | Jun. 30, 2015 | Dec. 31, 2014 | Jul. 31, 2014 | Dec. 31, 2016 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |||||
Date of incorporation | Apr. 16, 1992 | ||||
Stock issued during period, shares, new issues | 3,289,473 | 2,941,176 | 3,047,500 | 3,450,000 | |
Proceeds from public offering of common stock, net of issuance costs | $ 234.7 | $ 477.2 | $ 243.3 | $ 109.8 | |
Shares Issued, price per share | $ 76 | $ 170 | $ 85 | $ 34 | $ 76 |
Stock issued during period shares, overallotment options exercised | 397,500 | 450,000 | |||
Cash, cash equivalents and marketable securities | $ 884.8 | $ 884.8 |
Summary of significant accoun40
Summary of significant accounting policies and basis of presentation - Additional Information (Detail) | Jun. 03, 2015USD ($) | Jun. 30, 2014USD ($) | Dec. 31, 2016USD ($)Segment | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) |
Basis Of Presentation And Significant Accounting Policies [Line Items] | |||||
Number of operating segment | Segment | 1 | ||||
Impairment losses | $ 0 | $ 0 | $ 0 | ||
Significant uncertain tax positions | $ 0 | $ 0 | |||
Celgene Corporation [Member] | Up-front Payment Arrangement [Member] | Amended Collaborative Arrangement [Member] | |||||
Basis Of Presentation And Significant Accounting Policies [Line Items] | |||||
Collaboration agreement, cash payment received | $ 25,000,000 | ||||
Pregenen [Member] | |||||
Basis Of Presentation And Significant Accounting Policies [Line Items] | |||||
Total purchase consideration | $ 30,991,000 | ||||
Cash consideration | 5,093,000 | ||||
Common stock consideration | 19,348,000 | ||||
Contingent consideration | $ 6,550,000 |
Summary of significant accoun41
Summary of significant accounting policies and basis of presentation - Estimated Useful Lives of Assets (Detail) | 12 Months Ended |
Dec. 31, 2016 | |
Computer Equipment and Software [Member] | |
Property Plant And Equipment [Line Items] | |
Estimated useful lives of assets | 3 years |
Office and Laboratory Equipment [Member] | Minimum [Member] | |
Property Plant And Equipment [Line Items] | |
Estimated useful lives of assets | 2 years |
Office and Laboratory Equipment [Member] | Maximum [Member] | |
Property Plant And Equipment [Line Items] | |
Estimated useful lives of assets | 5 years |
Leasehold Improvements [Member] | |
Property Plant And Equipment [Line Items] | |
Leasehold improvements | Shorter of the useful life or remaining lease term |
Marketable securities - Summary
Marketable securities - Summary of Available for Sale Securities Held (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | $ 606,481 | $ 703,785 |
Unrealized Gains | 40 | 22 |
Unrealized Losses | (578) | (2,313) |
Fair Value | 605,943 | 701,494 |
U.S. Government Agency Securities and Treasuries [Member] | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | 600,001 | 689,425 |
Unrealized Gains | 34 | 22 |
Unrealized Losses | (575) | (2,300) |
Fair Value | 599,460 | 687,147 |
Certificates of Deposit [Member] | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | 6,480 | 14,360 |
Unrealized Gains | 6 | |
Unrealized Losses | (3) | (13) |
Fair Value | $ 6,483 | $ 14,347 |
Fair value measurements - Recor
Fair value measurements - Recorded Amount of Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Assets: | ||
Assets, fair value disclosure, recurring | $ 884,830 | $ 865,763 |
Liabilities: | ||
Liabilities, fair value disclosure, recurring | 7,756 | 8,665 |
Contingent Consideration [Member] | ||
Liabilities: | ||
Liabilities, fair value disclosure, recurring | 7,756 | 8,665 |
Cash and Cash Equivalents [Member] | ||
Assets: | ||
Assets, fair value disclosure, recurring | 278,887 | 164,269 |
Certificates of Deposit [Member] | ||
Assets: | ||
Assets, fair value disclosure, recurring | 6,483 | 14,347 |
U.S. Government Agency Securities [Member] | ||
Assets: | ||
Assets, fair value disclosure, recurring | 687,147 | |
U.S. Government Agency Securities and Treasuries [Member] | ||
Assets: | ||
Assets, fair value disclosure, recurring | 599,460 | |
Quoted prices in active markets (Level 1) [Member] | ||
Assets: | ||
Assets, fair value disclosure, recurring | 278,887 | 158,269 |
Quoted prices in active markets (Level 1) [Member] | Cash and Cash Equivalents [Member] | ||
Assets: | ||
Assets, fair value disclosure, recurring | 278,887 | 158,269 |
Significant other observable inputs (Level 2) [Member] | ||
Assets: | ||
Assets, fair value disclosure, recurring | 605,943 | 707,494 |
Significant other observable inputs (Level 2) [Member] | Cash and Cash Equivalents [Member] | ||
Assets: | ||
Assets, fair value disclosure, recurring | 6,000 | |
Significant other observable inputs (Level 2) [Member] | Certificates of Deposit [Member] | ||
Assets: | ||
Assets, fair value disclosure, recurring | 6,483 | 14,347 |
Significant other observable inputs (Level 2) [Member] | U.S. Government Agency Securities [Member] | ||
Assets: | ||
Assets, fair value disclosure, recurring | 687,147 | |
Significant other observable inputs (Level 2) [Member] | U.S. Government Agency Securities and Treasuries [Member] | ||
Assets: | ||
Assets, fair value disclosure, recurring | 599,460 | |
Significant unobservable inputs (Level 3) [Member] | ||
Liabilities: | ||
Liabilities, fair value disclosure, recurring | 7,756 | 8,665 |
Significant unobservable inputs (Level 3) [Member] | Contingent Consideration [Member] | ||
Liabilities: | ||
Liabilities, fair value disclosure, recurring | $ 7,756 | $ 8,665 |
Fair value measurements - Addit
Fair value measurements - Additional Information (Detail) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash equivalents maturities | Three months or less | |
Realized gain (loss) on available-for-sale securities | $ 0 | $ 0 |
Reclassification out of accumulated other comprehensive income (loss) | 0 | 0 |
Unrealized Loss on Securities | 376,100,000 | 638,100,000 |
Unrealized loss on securities, more than twelve months | 95,500,000 | 0 |
Investments with other-than-temporary impairment | 0 | 0 |
Contingent consideration, current | 4,479,000 | 3,584,000 |
Contingent consideration, non current | 3,277,000 | 5,082,000 |
Pregenen [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Contingent payment | $ 5,000,000 | $ 1,000,000 |
Minimum [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Milestone achievement period | 2,017 | |
Milestone discount rates | 10.10% | |
Maximum [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Milestone achievement period | 2,026 | |
Milestone discount rates | 13.10% |
Fair value measurements - Roll-
Fair value measurements - Roll-Forward of Fair Value of the Company's Contingent Consideration Obligations (Detail) - Significant unobservable inputs (Level 3) [Member] - Contingent consideration obligations [Member] - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Beginning balance | $ 8,665 | $ 6,796 |
Changes in fair value | 4,091 | 2,869 |
Payments | (5,000) | (1,000) |
Ending balance | $ 7,756 | $ 8,665 |
Property and equipment, net - P
Property and equipment, net - Property and Equipment (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Property Plant And Equipment [Line Items] | ||
Total property and equipment | $ 169,399 | $ 89,435 |
Less accumulated depreciation and amortization | (12,444) | (6,821) |
Property and equipment, net | 156,955 | 82,614 |
Computer Equipment and Software [Member] | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | 1,655 | 1,259 |
Office Equipment [Member] | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | 1,427 | 1,104 |
Laboratory Equipment [Member] | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | 16,305 | 10,520 |
Leasehold Improvements [Member] | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | 13,697 | 11,010 |
Construction in Progress [Member] | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | $ 136,315 | $ 65,542 |
Property and equipment, net - A
Property and equipment, net - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Property Plant And Equipment [Line Items] | |||
Depreciation and amortization expense | $ 5,900 | $ 3,700 | $ 2,300 |
Property and equipment, gross | 169,399 | 89,435 | |
Construction cost incurred by landlord | 120,140 | $ 61,901 | |
Construction In Progress 60 Binney Street [Member] | |||
Property Plant And Equipment [Line Items] | |||
Property and equipment, gross | 126,900 | ||
Construction cost incurred by landlord | $ 120,100 |
Restricted cash - Additional In
Restricted cash - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Letter of Credit [Member] | ||
Restricted Cash And Cash Equivalents Items [Line Items] | ||
Restricted cash balance | $ 14.4 | $ 10 |
60 Binney Street Lease [Member] | ||
Restricted Cash And Cash Equivalents Items [Line Items] | ||
Restricted cash balance | 13.8 | |
Decrease in restricted cash balance, year three | 1.5 | |
Decrease in restricted cash balance, year four | 1.5 | |
Decrease in restricted cash balance, year five | $ 1.5 |
Accrued expenses and other cu49
Accrued expenses and other current liabilities - Summary of Accrued Expenses and Other Current Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Payables And Accruals [Abstract] | ||
Employee compensation | $ 11,296 | $ 5,935 |
Accrued goods and services | 34,275 | 15,876 |
Accrued license and milestone fees | 2,464 | 277 |
Accrued professional fees | 1,492 | 1,014 |
Deferred rent, current portion | 11 | 964 |
Contingent consideration, current portion | 4,479 | 3,584 |
Other | 643 | 495 |
Total accrued expenses and other current liabilities | $ 54,660 | $ 28,145 |
Accrued expenses and other cu50
Accrued expenses and other current liabilities - Additional Information (Detail) $ in Millions | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |
Accrued bonus | $ 4.9 |
Construction In Progress 60 Binney Street [Member] | |
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |
Change in accrued goods and services | 4.5 |
Contract Manufacturing Organization [Member] | |
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |
Change in accrued goods and services | $ 6.2 |
Commitments and contingencies -
Commitments and contingencies - Additional Information (Detail) € in Millions | Dec. 31, 2016USD ($) | Nov. 18, 2016EUR (€) | Jun. 03, 2016USD ($) | Dec. 31, 2015USD ($) | Sep. 21, 2015USD ($)ft²$ / ft² | Jun. 29, 2015USD ($)ft² | Dec. 31, 2014USD ($) | Jun. 03, 2013USD ($)ft² | Jan. 31, 2017USD ($) | Dec. 31, 2016EUR (€) | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) |
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||||
Lease period | 9 years | |||||||||||||
Lease building space | ft² | 43,600 | |||||||||||||
Amendment effective date | 2014-06 | |||||||||||||
Additional lease building space | ft² | 9,900 | |||||||||||||
Lease payments | $ 200,000 | |||||||||||||
Increase in monthly lease payments | $ 300,000 | |||||||||||||
Contribution from the landlord towards the initial build-out of the space | 7,800,000 | |||||||||||||
Cash-collateralized irrevocable standby letter of credit | $ 600,000 | $ 600,000 | $ 1,300,000 | |||||||||||
Lease starting date | Jun. 3, 2013 | |||||||||||||
Lease termination date | Apr. 12, 2017 | |||||||||||||
Term of agreement | 5 years | |||||||||||||
Renewal period of agreement | 3 years | |||||||||||||
Up-front fee | € | € 3 | |||||||||||||
Up-front fee paid | € | € 2 | |||||||||||||
Up-front fee payable in mid-2018 | € | 1 | |||||||||||||
Annual maintenance and production fees | € | € 9.8 | |||||||||||||
Termination description | Company may terminate this agreement with six months’ notice and a one-time termination fee prior to July 1, 2018, or twelve months’ notice and a one-time termination fee thereafter. | |||||||||||||
Property and equipment, gross | 169,399,000 | 89,435,000 | $ 169,399,000 | $ 89,435,000 | ||||||||||
Construction financing lease obligation | 120,140,000 | $ 61,901,000 | 120,140,000 | 61,901,000 | ||||||||||
Tenant improvement costs incurred, not reimbursable | 1,800,000 | |||||||||||||
Non-cash rent expense | 8,300,000 | 5,700,000 | $ 4,300,000 | |||||||||||
Pregenen [Member] | ||||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||||
Contingent cash payments | 129,000,000 | 129,000,000 | ||||||||||||
Settlement of contingent consideration liability | 5,000,000 | $ 1,000,000 | ||||||||||||
Pregenen [Member] | Preclinical Milestones [Member] | ||||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||||
Contingent cash payments | 9,000,000 | 9,000,000 | ||||||||||||
Pregenen [Member] | Clinical Milestone Payments [Member] | ||||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||||
Contingent cash payments | 20,100,000 | 20,100,000 | ||||||||||||
Pregenen [Member] | Commercial Milestones Payments [Member] | ||||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||||
Contingent cash payments | 99,900,000 | 99,900,000 | ||||||||||||
Prepaid expenses and other current assets [Member] | ||||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||||
Tenant improvement costs reimbursable not yet received | 8,500,000 | 8,500,000 | ||||||||||||
Construction In Progress 60 Binney Street [Member] | ||||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||||
Property and equipment, gross | 126,900,000 | 126,900,000 | ||||||||||||
Construction financing lease obligation | $ 120,100,000 | 120,100,000 | ||||||||||||
Cash paid to the landlord | 0 | |||||||||||||
Land [Member] | ||||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||||
Non-cash rent expense | $ 1,900,000 | |||||||||||||
Subsequent Event [Member] | ||||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||||
Tenant improvement costs received | $ 7,800,000 | |||||||||||||
Lease starting on July 13, 2015 [Member] | ||||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||||
Lease period | 60 months | |||||||||||||
Lease building space | ft² | 15,120 | |||||||||||||
Lease payments | $ 500,000 | |||||||||||||
Lease starting date | Jul. 13, 2015 | |||||||||||||
Early termination lease term | 20 months | |||||||||||||
Operating lease description | Under the terms of the lease, the Company leased approximately 15,120 square feet starting on July 13, 2015 for $0.5 million per year in base rent, which is subject to a 3% annual rent increase plus certain operating expenses and taxes. | |||||||||||||
Operating lease, rent increase percentage | 3.00% | |||||||||||||
Lease starting on January 1, 2016 [Member] | ||||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||||
Lease building space | ft² | 8,075 | |||||||||||||
Lease payments | $ 300,000 | |||||||||||||
Lease starting date | Jan. 1, 2016 | |||||||||||||
Operating lease description | Under the terms of the lease, the Company has also leased an additional 8,075 square feet of office space in the same premises starting on January 1, 2016 for an additional $0.3 million per year in base rent, which is subject to a 3% annual rent increase plus certain operating expenses and taxes. The Company has provided its landlord with notice of termination of this lease, with termination to be effective April 12, 2017. | |||||||||||||
Operating lease, rent increase percentage | 3.00% | |||||||||||||
Strategic manufacturing agreement [Member] | ||||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||||
Lease period | 12 years | |||||||||||||
Lease payments | $ 5,100,000 | |||||||||||||
Early termination lease term | 24 months | |||||||||||||
Amount payable upon achievement of certain contractual milestones | $ 12,500,000 | |||||||||||||
Estimated year of construction completion | 2,018 | |||||||||||||
Milestone payments made | $ 5,000,000 | |||||||||||||
Agreement termination description | The Company may terminate this agreement any time after July 1, 2016 upon payment of a one-time termination fee and up to 24 months of fixed suite and labor fees. | |||||||||||||
Strategic manufacturing agreement [Member] | Subsequent Event [Member] | ||||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||||
Milestone payments made | $ 3,000,000 | |||||||||||||
Strategic manufacturing agreement [Member] | Maximum [Member] | ||||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||||
Additional contractual payables to milestones | $ 8,000,000 | |||||||||||||
Lease starting on October 1, 2016 [Member] | ||||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||||
Lease period | 120 months | |||||||||||||
Lease building space | ft² | 253,108 | |||||||||||||
Contribution from the landlord towards the initial build-out of the space | $ 42,400,000 | |||||||||||||
Cash-collateralized irrevocable standby letter of credit | $ 9,200,000 | |||||||||||||
Lease starting date | Oct. 1, 2016 | |||||||||||||
Lease payments base annual rent | $ 18,400,000 | |||||||||||||
Capital lease description | Under the terms of the 60 Binney Street Lease, starting on October 1, 2016, the Company will lease approximately 253,108 square feet of office and laboratory space at $72.50 per square foot per year, or $18.4 million per year in base rent, which is subject to scheduled annual rent increases of 1.75% plus certain operating expenses and taxes. | |||||||||||||
Increase in letter of credit under the terms of the lease | $ 13,800,000 | |||||||||||||
Lease starting on October 1, 2016 [Member] | 60 Binney Street Lease [Member] | ||||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||||
Annual lease rent per square foot | $ / ft² | 72.50 | |||||||||||||
Lease rent increase percentage | 1.75% | |||||||||||||
Option to extend capital lease | 5 years |
Commitments and contingencies52
Commitments and contingencies - Future Minimum Commitments (Detail) $ in Thousands | Dec. 31, 2016USD ($) |
Future Minimum Payments Due [Line Items] | |
2,017 | $ 26,424 |
2,018 | 29,015 |
2,019 | 28,815 |
2,020 | 29,146 |
2,021 | 29,484 |
2022 and thereafter | 141,600 |
Total minimum lease payments | 284,484 |
Other Operating Lease [Member] | |
Future Minimum Payments Due [Line Items] | |
2,017 | 11,963 |
2,018 | 10,368 |
2,019 | 9,841 |
2,020 | 9,841 |
2,021 | 9,841 |
2022 and thereafter | 32,725 |
Total minimum lease payments | 84,579 |
150 Second Street Lease [Member] | |
Future Minimum Payments Due [Line Items] | |
2,017 | 1,359 |
Total minimum lease payments | 1,359 |
60 Binney Street Lease [Member] | |
Future Minimum Payments Due [Line Items] | |
2,017 | 13,102 |
2,018 | 18,647 |
2,019 | 18,974 |
2,020 | 19,305 |
2,021 | 19,643 |
2022 and thereafter | 108,875 |
Total minimum lease payments | $ 198,546 |
Common stock and preferred st53
Common stock and preferred stock - Additional Information (Detail) - shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Equity [Abstract] | ||
Common stock, shares authorized | 125,000,000 | 125,000,000 |
Common stock voting rights | Common stock are entitled to one vote per share | |
Issuing of shares | 5,000,000 | 5,000,000 |
Shares of preferred stock issued | 0 | 0 |
Shares of preferred stock outstanding | 0 | 0 |
Common stock and preferred st54
Common stock and preferred stock - Summary of Future Issuance of Common Stock Shares (Detail) - shares shares in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Schedule Of Capitalization [Line Items] | ||
Common shares reserved for future issuance | 5,433 | 4,472 |
Options to Purchase Common Stock [Member] | ||
Schedule Of Capitalization [Line Items] | ||
Common shares reserved for future issuance | 3,735 | 3,532 |
Restricted Stock Units [Member] | ||
Schedule Of Capitalization [Line Items] | ||
Common shares reserved for future issuance | 263 | 148 |
2013 Employee Stock Purchase Plan [Member] | ||
Schedule Of Capitalization [Line Items] | ||
Common shares reserved for future issuance | 209 | 227 |
2013 Stock Option and Incentive Plan [Member] | ||
Schedule Of Capitalization [Line Items] | ||
Common shares reserved for future issuance | 1,226 | 565 |
Significant agreements - Additi
Significant agreements - Additional Information (Detail) - Celgene Corporation [Member] $ in Millions | Jun. 03, 2015USD ($)Deliverables | Mar. 19, 2013USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Feb. 17, 2016USD ($) | Feb. 16, 2016USD ($) |
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||
Term of collaboration agreement | 3 years | ||||||
First Product Candidates [Member] | |||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||
Amount per product eligible to be received upon achievement of specified event | $ 10 | ||||||
Amount paid per product upon achievement of specified event | $ 10 | ||||||
Additional Product Candidates [Member] | |||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||
Amount per product eligible to be received upon achievement of specified event | $ 15 | ||||||
Co-Develop and Co-Promote Options not Exercise [Member] | |||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||
Amount per product eligible to be received upon achievement of specified event | $ 10 | ||||||
Collaborative Arrangement [Member] | |||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||
Number of deliverable | Deliverables | 3 | ||||||
Consideration allocated to agreement | $ 109 | ||||||
Deferred revenue recognition period | 3 years | ||||||
Deferred revenue recognized | $ 6.2 | $ 14.1 | $ 25 | ||||
Deferred revenue | 46.4 | $ 41.8 | |||||
Deferred revenue expected to be recognized | 8.8 | ||||||
Collaborative Arrangement [Member] | Option Fee [Member] | |||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||
Amount per product eligible to be received upon achievement of specified event | 10 | ||||||
Collaborative Arrangement [Member] | Delivered Elements [Member] | |||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||
Collaboration agreement, cash payment received | $ 20 | ||||||
Consideration allocated to agreement | 17.3 | ||||||
Up-front Payment Arrangement [Member] | Collaborative Arrangement [Member] | |||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||
Collaboration agreement, cash payment received | $ 75 | 25 | |||||
Up-front Payment Arrangement [Member] | Amended Collaborative Arrangement [Member] | |||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||
Collaboration agreement, cash payment received | $ 25 | ||||||
Manufacturing Services [Member] | Collaborative Arrangement [Member] | |||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||
Amount per product eligible to be received upon achievement of specified event | 91.7 | ||||||
Consideration allocated to agreement | $ 54.1 |
Business Combinations - Additio
Business Combinations - Additional Information (Detail) - Pregenen [Member] - USD ($) $ in Millions | Jun. 30, 2014 | Dec. 31, 2016 | Dec. 31, 2015 |
Business Acquisition [Line Items] | |||
Gene editing platform expected useful life | 8 years | ||
Amortization expense | $ 3.8 | $ 3.8 | |
Accumulated Amortization | $ 9.4 | $ 5.6 |
Business Combinations - Schedul
Business Combinations - Schedule of Estimated Amortization of Intangible Assets (Detail) $ in Thousands | Jun. 30, 2014USD ($) |
Finite Lived Intangible Assets Future Amortization Expense [Abstract] | |
2,017 | $ 3,763 |
2,018 | 3,763 |
2,019 | 3,763 |
2,020 | 3,763 |
2,021 | 3,763 |
2,022 | 1,879 |
Total | $ 20,694 |
Stock-based compensation - Addi
Stock-based compensation - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Jan. 31, 2017 | Jan. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Jun. 24, 2013 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Increased number of issuance of awards under the 2013 Plan | 1,500,000 | |||||
Number of shares available for issuance | 1,200,000 | |||||
Stock-based compensation expense | $ 39,756 | $ 41,120 | $ 10,763 | |||
Intrinsic value of stock options exercised | $ 15,300 | $ 147,900 | $ 41,400 | |||
Weighted average grant date fair value of options granted | $ 34.22 | $ 74.65 | $ 18.53 | |||
Incremental value on option valuation | $ 600 | |||||
Research And Development Expense [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Stock-based compensation expense | $ 19,690 | $ 24,854 | 5,151 | |||
Restricted Stock Awards [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Stock-based compensation expense | 52 | |||||
Unvested restricted stock awards outstanding | 0 | 0 | ||||
Restricted stock awards granted | 0 | |||||
Aggregate fair value of stock awards vested | 1,900 | |||||
Stock Options [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Stock-based compensation expense | $ 33,966 | $ 37,536 | 9,487 | |||
Unrecognized stock- based compensation expense related to unvested stock options, restricted stock awards and employee stock purchase plan | $ 69,500 | |||||
Expected weighted-average period related to unvested stock options, restricted stock awards and employee stock purchase plan | 2 years 6 months | |||||
Restricted Stock Units [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Stock-based compensation expense | $ 5,374 | $ 3,325 | 1,158 | |||
Unvested restricted stock awards outstanding | 263,000 | 148,000 | ||||
Restricted stock awards granted | 263,000 | |||||
Unrecognized stock- based compensation expense related to unvested stock options, restricted stock awards and employee stock purchase plan | $ 11,900 | |||||
Expected weighted-average period related to unvested stock options, restricted stock awards and employee stock purchase plan | 2 years 9 months 18 days | |||||
Employee Stock Purchase Plan [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Common shares reserved for future issuance | 238,000 | |||||
Stock-based compensation expense | $ 416 | $ 259 | $ 66 | |||
Unrecognized stock- based compensation expense related to unvested stock options, restricted stock awards and employee stock purchase plan | $ 100 | |||||
Expected weighted-average period related to unvested stock options, restricted stock awards and employee stock purchase plan | 1 month 6 days | |||||
Shares of common stock issued under plan | 18,338 | 10,545 | ||||
Non Employee Stock Option [Member] | Research And Development Expense [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Incremental value on option valuation | $ 10,300 | |||||
Subsequent Event [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Increased number of issuance of awards under the 2013 Plan | 1,600,000 | |||||
2013 Stock Option and Incentive Plan [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Common shares reserved for future issuance | 955,000 | |||||
2013 Stock Option and Incentive Plan [Member] | Maximum [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Percentage of automatic increase in shares reserved and available for issuance determined based on shares outstanding | 4.00% |
Stock-based compensation - Summ
Stock-based compensation - Summary of Stock-Based Compensation Expense by Award Type (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 39,756 | $ 41,120 | $ 10,763 |
Stock Options [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation expense | 33,966 | 37,536 | 9,487 |
Restricted Stock Awards [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation expense | 52 | ||
Restricted Stock Units [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation expense | 5,374 | 3,325 | 1,158 |
Employee Stock Purchase Plan [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 416 | $ 259 | $ 66 |
Stock-based compensation - Sche
Stock-based compensation - Schedule of Stock-Based Compensation Expense by Classification (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 39,756 | $ 41,120 | $ 10,763 |
Research And Development Expense [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation expense | 19,690 | 24,854 | 5,151 |
General And Administrative [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 20,066 | $ 16,266 | $ 5,612 |
Stock-based compensation - Assu
Stock-based compensation - Assumptions Used for the Black-Scholes Option-Pricing Model to Determine the Per Share Weighted Average Fair Value for Options Granted (Detail) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |||
Expected volatility | 74.30% | 72.60% | 82.30% |
Expected term (in years) | 6 years | 5 years 10 months 24 days | 6 years |
Risk-free interest rate | 1.50% | 1.70% | 1.80% |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Stock-based compensation - Su62
Stock-based compensation - Summary of Stock Option Activity Under Plan (Detail) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2016USD ($)$ / sharesshares | ||
Shares | ||
Outstanding at beginning of period | shares | 3,532 | |
Granted | shares | 1,047 | |
Exercised | shares | (377) | |
Canceled or forfeited | shares | (467) | |
Outstanding at end of period | shares | 3,735 | |
Exercisable at end of period | shares | 1,926 | |
Vested and expected to vest at end of period | shares | 3,735 | |
Weighted-average exercise price per share | ||
Outstanding at beginning of period | $ / shares | $ 48.74 | |
Granted | $ / shares | 52.09 | |
Exercised | $ / shares | 16.30 | |
Canceled or forfeited | $ / shares | 55.04 | |
Outstanding at end of period | $ / shares | 52.17 | |
Exercisable at end of period | $ / shares | 39.23 | |
Vested and expected to vest at end of period | $ / shares | $ 52.17 | |
Outstanding at December 31, 2016 | 7 years 6 months | |
Exercisable at December 31, 2016 | 6 years 6 months | |
Vested and expected to vest at December 31, 2016 | 7 years 6 months | |
Aggregate intrinsic value | ||
Outstanding at end of period | $ | $ 93,081 | [1] |
Exercisable at end of period | $ | 70,991 | [1] |
Vested and expected to vest at end of period | $ | $ 93,081 | [1] |
[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 December 31, 2016. |
Stock-based compensation - Su63
Stock-based compensation - Summary of Restricted Stock Units (Detail) - Restricted Stock Units [Member] shares in Thousands | 12 Months Ended |
Dec. 31, 2016$ / sharesshares | |
Shares | |
Unvested balance at beginning of period | shares | 148 |
Granted | shares | 263 |
Vested | shares | (113) |
Forfeited | shares | (35) |
Unvested balance at end of period | shares | 263 |
Weighted-average grant date fair value | |
Unvested balance at beginning of period | $ / shares | $ 65.79 |
Granted | $ / shares | 52.12 |
Vested | $ / shares | 46.17 |
Forfeited | $ / shares | 46.65 |
Unvested balance at end of period | $ / shares | $ 63.07 |
401(k) Savings plan - Additiona
401(k) Savings plan - Additional Information (Detail) - 401 (k) [Member] - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | |
Feb. 28, 2017 | Feb. 29, 2016 | Dec. 31, 2014 | |
Defined Contribution Plan Disclosure [Line Items] | |||
Contributions to the 401(k) Plan | $ 0.6 | $ 0 | |
Subsequent Event [Member] | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Contributions to the 401(k) Plan | $ 1 |
Income taxes - Schedule of Comp
Income taxes - Schedule of Components of Loss Before Income Taxes (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
U.S. | $ (210,188) | $ (162,287) | $ (61,118) |
Foreign | (53,931) | (4,436) | 612 |
Loss before income taxes | $ (264,119) | $ (166,723) | $ (60,506) |
Income taxes - Summary of (Bene
Income taxes - Summary of (Benefit from) Provision for Income Taxes (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Current | |||
State | $ 1 | ||
Foreign | $ 60 | ||
Deferred | |||
Federal | $ (588) | (9,390) | |
State | (24) | (2,408) | |
Total income tax expense (benefit) | $ (612) | $ 60 | $ (11,797) |
Income taxes - Reconciliation o
Income taxes - Reconciliation of Income Tax (Benefit) Provision Computed at the Statutory Federal Income Tax Rate to Effective Income Tax Rate (Benefit) Provision as Reflected in the Financial Statements (Detail) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
Federal income tax expense at statutory rate | 34.00% | 34.00% | 34.00% |
State income tax, net of federal benefit | 3.30% | 4.20% | 4.00% |
Permanent differences | (5.30%) | (6.40%) | (3.20%) |
Research and development credit | 15.00% | 14.60% | 25.70% |
Foreign differential | (7.00%) | (1.00%) | 0.00% |
Other | 0.00% | (0.50%) | 0.00% |
Change in valuation allowance | (39.90%) | (44.90%) | (41.00%) |
Effective income tax rate benefit | 0.10% | 0.00% | 19.50% |
Income taxes - Additional Infor
Income taxes - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Components Of Income Tax Expense Benefit [Line Items] | |||
Income tax benefit (expense) | $ 612 | $ (60) | $ 11,797 |
Effective income tax rate benefit | 0.10% | 0.00% | 19.50% |
Approximately valuation allowance increased | $ 105,300 | ||
Earlier Tax Year [Member] | |||
Components Of Income Tax Expense Benefit [Line Items] | |||
Federal, state and foreign income tax returns | Dec. 31, 2012 | ||
Latest Tax Year [Member] | |||
Components Of Income Tax Expense Benefit [Line Items] | |||
Federal, state and foreign income tax returns | Dec. 31, 2015 | ||
Research Tax Credit Carryforward [Member] | |||
Components Of Income Tax Expense Benefit [Line Items] | |||
Limitations on use of net operating losses and tax credit carryforwards, percentage | 50.00% | ||
Limitations on use of net operating losses and tax credit carryforwards, period | 3 years | ||
Significant accrued interest or penalties related to uncertain tax positions | $ 0 | $ 0 | $ 0 |
Interest or penalties Expense related to uncertain tax positions | 0 | 0 | 0 |
U.S. [Member] | |||
Components Of Income Tax Expense Benefit [Line Items] | |||
Operating loss carryforwards | $ 466,800 | $ 347,500 | $ 130,000 |
Operating loss carryforwards expiration year | 2,036 | 2,036 | 2,036 |
Credit carryforward expiration year | 2,036 | 2,036 | 2,036 |
U.S. [Member] | Excess Equity Based Compensation Tax Deductions | |||
Components Of Income Tax Expense Benefit [Line Items] | |||
Operating loss carryforwards | $ 195,400 | ||
U.S. [Member] | Research Tax Credit Carryforward [Member] | |||
Components Of Income Tax Expense Benefit [Line Items] | |||
Tax credit carryforward amount | 83,200 | $ 44,900 | $ 22,000 |
State and Local Jurisdiction [Member] | |||
Components Of Income Tax Expense Benefit [Line Items] | |||
Operating loss carryforwards | $ 456,800 | $ 335,000 | $ 115,500 |
Operating loss carryforwards expiration year | 2,036 | 2,036 | 2,036 |
Credit carryforward expiration year | 2,031 | 2,031 | 2,031 |
State and Local Jurisdiction [Member] | Excess Equity Based Compensation Tax Deductions | |||
Components Of Income Tax Expense Benefit [Line Items] | |||
Operating loss carryforwards | $ 195,400 | ||
State and Local Jurisdiction [Member] | Research Tax Credit Carryforward [Member] | |||
Components Of Income Tax Expense Benefit [Line Items] | |||
Tax credit carryforward amount | 6,000 | $ 3,800 | $ 2,000 |
Foreign Tax Authority [member] | |||
Components Of Income Tax Expense Benefit [Line Items] | |||
Operating loss carryforwards | $ 0 | $ 600 | 2,700 |
Excluding the impact of tax adjustments | |||
Components Of Income Tax Expense Benefit [Line Items] | |||
Income tax benefit (expense) | $ 11,800 | ||
Effective income tax rate benefit | 0.00% |
Income taxes - Components of De
Income taxes - Components of Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred tax assets: | ||
U.S. net operating loss carryforwards | $ 106,064 | $ 62,844 |
Foreign net operating loss carryforwards | 194 | |
Tax credit carryforwards | 87,117 | 47,386 |
Capitalized research and development expenses, net | 631 | 979 |
Capital lease | 47,191 | 24,315 |
Deferred revenue | 18,231 | 16,438 |
Capitalized license fees | 11,752 | 5,488 |
Accruals and other | 32,172 | 19,486 |
Total deferred tax assets | 303,158 | 177,130 |
Intangible assets | (8,129) | (9,606) |
Fixed assets | (48,902) | (26,681) |
Less valuation allowance | $ (246,127) | $ (140,843) |
Net loss per share - Common Sto
Net loss per share - Common Stock Equivalents Excluded from Calculation of Diluted Net Loss Per Share (Detail) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Common stock equivalents excluded from the calculation of diluted net loss per share | 4,009 | 3,683 | 4,108 |
Warrants [Member] | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Common stock equivalents excluded from the calculation of diluted net loss per share | 177 | ||
Outstanding Stock Options [Member] | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Common stock equivalents excluded from the calculation of diluted net loss per share | 3,735 | 3,532 | 3,652 |
Restricted Stock Units [Member] | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Common stock equivalents excluded from the calculation of diluted net loss per share | 263 | 148 | 179 |
ESPP Shares [Member] | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Common stock equivalents excluded from the calculation of diluted net loss per share | 11 | 3 | 6 |
Acquisition holdback [Member] | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Common stock equivalents excluded from the calculation of diluted net loss per share | 94 |
Selected quarterly financial 71
Selected quarterly financial data - Quarterly Financial Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Total revenue | $ 1,552 | $ 1,552 | $ 1,552 | $ 1,499 | $ 1,471 | $ 1,324 | $ 4,940 | $ 6,344 | $ 6,155 | $ 14,079 | $ 25,421 |
Total operating expenses | 73,887 | 79,692 | 61,527 | 58,879 | 50,432 | 44,451 | 56,963 | 31,270 | 273,985 | 183,116 | 86,047 |
Loss from operations | (72,335) | (78,140) | (59,975) | (57,380) | (48,961) | (43,127) | (52,023) | (24,926) | (267,830) | (169,037) | (60,626) |
Net loss | $ (71,364) | $ (77,025) | $ (58,844) | $ (56,274) | $ (47,277) | $ (42,924) | $ (51,795) | $ (24,787) | $ (263,507) | $ (166,783) | $ (48,709) |
Net loss per share applicable to common stockholders - basic and diluted | $ (1.88) | $ (2.07) | $ (1.59) | $ (1.52) | $ (1.29) | $ (1.18) | $ (1.57) | $ (0.76) | $ (7.07) | $ (4.81) | $ (1.83) |