Xencor (XNCR) 10-Q 5 Nov 18 2018 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2018	Oct. 31, 2018
Document and Entity Information
Entity Registrant Name	Xencor Inc
Entity Central Index Key	1,326,732
Document Type	10-Q
Document Period End Date	Sep. 30, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		56,234,332
Entity Small Business	false
Entity Emerging Growth Company	false
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	Q3

Balance Sheets

Balance Sheets $ in Thousands	Sep. 30, 2018USD ($)
Current assets
Cash and cash equivalents	$ 34,996
Marketable securities	236,605
Accounts receivable	2,462
Income tax receivable	762
Prepaid expenses and other current assets	12,095
Total current assets	286,920
Property and equipment, net	9,688
Patents, licenses, and other intangible assets, net	11,677
Marketable securities - long term	276,228
Income tax receivable	762
Other assets	311
Total assets	585,586
Current liabilities
Accounts payable	5,983
Accrued expenses	5,671
Current portion of deferred rent	294
Deferred revenue	40,079
Total current liabilities	52,027
Deferred rent, less current portion	1,286
Total liabilities	53,313
Commitments and contingencies
Stockholders' equity
Preferred stock, $0.01 par value: 10,000,000 authorized shares; -0- issued and outstanding shares at September 30, 2018 and December 31, 2017
Common stock, $0.01 par value: 200,000,000 authorized shares at September 30, 2018 and December 31, 2017; 56,212,449 issued and outstanding at September 30, 2018 and 47,002,488 issued and outstanding at December 31, 2017	562
Additional paid-in capital	839,127
Accumulated other comprehensive loss	(2,338)
Accumulated deficit	(305,078)
Total stockholders' equity	532,273
Total liabilities and stockholders' equity	$ 585,586

Balance Sheets (Parenthetical)

Balance Sheets (Parenthetical) - $ / shares	Sep. 30, 2018	Dec. 31, 2017
Condensed Balance Sheets
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	200,000,000	200,000,000
Common stock, shares issued	56,212,449	47,002,488
Common stock, shares outstanding	56,212,449	47,002,488

Statements of Comprehensive Inc

Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Revenue
Collaborations, licenses and milestones	$ 29,039		$ 29,039	$ 16,000
Operating expenses
Research and development	20,953	$ 19,408	70,371	51,376
General and administrative	7,435	4,172	16,955	13,074
Total operating expenses	28,388	23,580	87,326	64,450
Income (loss) from operations	651	(23,580)	(58,287)	(48,450)
Other income (expenses)
Interest income, net	2,642	1,045	6,279	3,134
Other income (expense)	(143)	56	(202)	86
Total other income, net	2,499	1,101	6,077	3,220
Net income (loss) before income taxes	3,150	(22,479)	(52,210)	(45,230)
Income tax expense		173		623
Net income (loss)	3,150	(22,652)	(52,210)	(45,853)
Other comprehensive income (loss)
Net unrealized gain (loss) on marketable securities	(330)	143	(530)	344
Comprehensive income (loss)	$ 2,820	$ (22,509)	$ (52,740)	$ (45,509)
Net income (loss) per share attributable to common shareholders:
Basic net income (loss) (in dollars per share)	$ 0.06	$ (0.48)	$ (0.98)	$ (0.98)
Diluted net income (loss) (in dollars per share)	$ 0.05	$ (0.48)	$ (0.98)	$ (0.98)
Weighted average shares used to compute net income (loss) per share attributable to common stockholders:
Basic (in shares)	55,974,080	46,929,498	53,165,774	46,766,562
Diluted (in shares)	58,313,002	46,929,498	53,165,774	46,766,562

Statement of Stockholders' Equi

Statement of Stockholders' Equity - USD ($) $ in Thousands	Scenario, Previously ReportedCommon Stock	Scenario, Previously ReportedAdditional Paid-in Capital	Scenario, Previously ReportedAccumulated Other Comprehensive Loss	Scenario, Previously ReportedAccumulated Deficit	Scenario, Previously Reported	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Loss	Accumulated Deficit	Total
Balance at Dec. 31, 2017	$ 470	$ 570,670	$ (1,808)	$ (287,286)	$ 282,046	$ 470	$ 570,670	$ (1,808)	$ (252,868)	$ 316,464
Balance (in shares) at Dec. 31, 2017	47,002,488					47,002,488
Increase (Decrease) in Stockholders' Equity
Adoption of new accounting principle | ASU 2014-09									34,418	34,418
Balance, revised						$ 470	570,670	(1,808)	(252,868)	316,464
Sale of common stock, net of issuance cost						$ 84	245,420			245,504
Sale of common stock, net of issuance cost (in shares)						8,395,000
Issuance of common stock upon exercise of stock awards						$ 8	7,060			7,068
Issuance of common stock upon exercise of stock awards (in shares)						788,409
Issuance of common stock under the Employee Stock Purchase Plan							504			504
Issuance of common stock under the Employee Stock Purchase Plan (in shares)						26,552
Comprehensive loss								(530)	(52,210)	(52,740)
Stock-based compensation expense							15,473			15,473
Balance at Sep. 30, 2018						$ 562	$ 839,127	$ (2,338)	$ (305,078)	$ 532,273
Balance (in shares) at Sep. 30, 2018						56,212,449

Statements of Cash Flows

Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Cash flows from operating activities
Net loss	$ (52,210)	$ (45,853)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation and amortization	2,368	1,420
Amortization of premium on marketable securities	68	2,148
Stock-based compensation	15,473	10,211
Abandonment of capitalized intangible assets	118	273
Loss (gain) on disposal of assets	110	(2)
Changes in operating assets and liabilities:
Accounts receivable	(1,320)	7,785
Interest receivable	(624)	(602)
Prepaid expenses and other assets	(6,535)	(3,971)
Accounts payable	(886)	2,722
Accrued expenses	192	(2,056)
Income taxes	(156)	(65)
Deferred rent	466	359
Deferred revenue	(20,039)	700
Net cash used in operating activities	(62,975)	(26,931)
Cash flows from investing activities
Purchase of marketable securities	(331,126)	(49,203)
Purchase of intangible assets	(1,302)	(1,520)
Purchase of property and equipment	(4,425)	(3,832)
Proceeds from maturities of marketable securities	165,134	77,566
Repayment (issuance) of loan	86	(86)
Net cash provided by (used in) investing activities	(171,633)	22,925
Cash flows from financing activities
Proceeds from issuance of common stock upon exercise of stock awards	7,068	2,669
Proceeds from issuance of common stock under the Employee Stock Purchase Plan	504	443
Proceeds from issuance of common stock	260,245
Common stock issuance costs	(14,741)
Net cash provided by financing activities	253,076	3,112
Net increase (decrease) in cash and cash equivalents	18,468	(894)
Cash and cash equivalents, beginning of period	16,528	14,528
Cash and cash equivalents, end of period	34,996	13,634
Cash paid during the period for:
Interest	9	8
Taxes	170	790
Supplemental disclosures of non-cash investing activities
Unrealized gain (loss) on marketable securities, net of tax	$ (530)	$ 344

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2018
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies	1. Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited interim financial statements for Xencor, Inc. (the Company) have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information. Certain amounts in the prior period financial statements have been revised to conform to the presentation of the current period financial statements. See “Recent Accounting Pronouncements – Pronouncements Adopted in 2018. ” The financial statements include all adjustments (consisting only of normal recurring adjustments) that the management of the Company believes are necessary for a fair presentation of the periods presented. The preparation of interim financial statements requires the use of management’s estimates and assumptions that affect reported amounts of assets and liabilities at the date of the interim financial statements and the reported revenues and expenditures during the reported periods. These interim financial results are not necessarily indicative of the results expected for the full fiscal year or for any subsequent interim period. The accompanying unaudited interim financial statements and related notes should be read in conjunction with the audited financial statements and notes thereto included in the Company’s 2017 Annual Report on Form 10-K filed with the Securities and Exchange Commission (SEC) on February 28, 2018. Use of Estimates The preparation of interim financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, other comprehensive gain (loss) and the related disclosures. On an ongoing basis, management evaluates its estimates, including estimates related to its accrued clinical trial and manufacturing development expenses, stock-based compensation expense, intangible assets and related amortization. Significant estimates in these interim financial statements include estimates made for accrued research and development expenses, stock-based compensation expenses, intangible assets and related amortization. Intangible Assets The Company maintains definite-lived intangible assets related to certain capitalized costs of acquired licenses and third-party costs incurred in establishing and maintaining its intellectual property rights to its platform technologies and development candidates. These assets are amortized over their useful lives, which are estimated to be the remaining patent life or the contractual term of the license. The straight-line method is used to record amortization expense. The Company assesses its intangible assets for impairment if indicators are present or changes in circumstances suggest that impairment may exist. There were no impairment charges recorded for the three and nine-months ended September 30, 2018 and 2017. The Company capitalizes certain in-process intangible assets that are abandoned when they are no longer pursued. During the nine months ended September 30, 2018 and 2017, the Company abandoned $0.1 million and $0.3 million, respectively, of in-process intangible assets. Marketable Securities The Company has an investment policy that includes guidelines on acceptable investment securities, minimum credit quality, maturity parameters and concentration and diversification. The Company invests its excess cash primarily in marketable securities issued by investment grade institutions. The Company considers its marketable securities to be available-for-sale. These assets are carried at fair value and the unrealized gains and losses are included in accumulated other comprehensive income (loss). Accrued interest on marketable securities is included in marketable securities. If a decline in the value of a marketable security in the Company’s investment portfolio is deemed to be other-than-temporary, the Company writes down the security to its current fair value and recognizes a loss as a charge against income. The Company reviews its portfolio of marketable securities, using both quantitative and qualitative factors, to determine if declines in fair value below cost are other-than-temporary. Recent Accounting Pronouncements Pronouncements Adopted in 2018 Effective January 1, 2018, the Company adopted Accounting Standards Codification Topic 606 (ASC 606), Revenue from Contracts with Customers , using the full retrospective transition method. Under this method, the Company is presenting its financial statements for the years ended December 31, 2016 and 2017 and applicable interim periods within the year ended 2017 as if ASC 606 had been effective for those periods. Under ASC 606 an entity recognizes revenue when its customer obtains control of promised goods or services in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. A five-step model is used to achieve the core principle: (1) identify the customer contract, (2) identify the contract’s performance obligations, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations and (5) recognize revenue when or as a performance obligation is satisfied. The Company applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. The new guidance provides that revenue recognition for performance obligations related to delivery of certain goods or services occurs when control over the good or service is transferred to the customer. In addition, the timing of revenue recognition from licensing of our intellectual property that are functional and are distinct performance obligations changed from being recognized over the term of access to our license or technology to being recognized at a point in time. See Note 11 “Prior-Period Financial Statements” for a complete discussion of the impact of adopting the new standard. Effective January 1, 2018, the Company adopted ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, which addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. The adoption of this standard did not have an effect on the Company’s statements of cash flow. Effective January 1, 2018, the Company adopted ASU No. 2017-09, Compensation – Stock Compensation (Topic 718) . The standard applies when a company changes the terms of a stock compensation award granted to an employee. The Company did not have any modifications upon adopting the new standard; therefore, adoption of the new standard had no effect on the Company’s financial statements. Pronouncements Not Yet Effective In February 2016, the FASB issued ASU No. 2016-02 Leases . The new guidance requires lessees to recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term for all leases not considered short term. The new standard will be effective for reporting periods beginning after December 15, 2018. In July 2018, the FASB issued ASU 2018-11, Lease (Topic 842): Targeted Improvements, which provides an alternative transition method of adoption, permitting the recognition of cumulative-effect adjustment to retained earnings on the date of adoption. We are currently evaluating our leases which includes a review of our lease expenses, which are primarily operating lease arrangements for our facilities in Monrovia and San Diego . We intend to adopt the standard on the effective date but have not yet selected a transition method. In June 2018, the FASB issued ASU No. 2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting, which expands the scope of Topic 718 to include share-based payments issued to nonemployees for goods and services. The standard is effective for fiscal years beginning after December 15, 2018 and interim periods within such fiscal year. The Company does not anticipate that the standard will have a significant impact on its financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement, which modifies the disclosures for transfers between Level 1 and Level 2 of the fair value hierarchy, modifies the level 3 disclosure requirements for non-public entities and requires additional disclosure for Level 3 fair value hierarchy. The amendment is effective for fiscal years beginning after December 15, 2019. The Company does not anticipate that the standard will have a significant impact on its financial statements. In August 2018, the FASB issued ASU No. 2018-15, Intangibles – Goodwill and Other – Internal Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract, which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). The accounting for the service element of a hosting arrangement that is a service contract is not affected by the amendment. The amendment is effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2019. The Company does not anticipate that the standard will have a significant impact on its financial statements. There have been no other material changes to the significant accounting policies previously disclosed in the Company’s 2017 Annual Report on Form 10-K.

Fair Value of Financial Instrum

Fair Value of Financial Instruments	9 Months Ended
	Sep. 30, 2018
Fair Value of Financial Instruments
Fair Value of Financial Instruments	2. Fair Value of Financial Instruments Financial instruments included in the financial statements include cash equivalents, marketable securities, accounts receivable, accounts payable and accrued expenses. Marketable securities and cash equivalents are carried at fair value. The fair value of the other financial instruments closely approximates their fair value due to their short-term maturities. The Company accounts for recurring and non-recurring fair value measurements in accordance with FASB Accounting Standards Codification (ASC) 820, Fair Value Measurements and Disclosures . ASC 820 defines fair value, establishes a fair value hierarchy for assets and liabilities measured at fair value, and requires expanded disclosure about fair value measurements. The ASC 820 hierarchy ranks the quality of reliable inputs, or assumptions, used in the determination of fair value and requires assets and liabilities carried at fair value to be classified and disclosed in one of the following three categories: Level 1— Fair Value is determined by using unadjusted quoted prices that are available in active markets for identical assets or liabilities. Level 2— Fair Value is determined by using inputs other than Level 1 quoted prices that are directly or indirectly observable. Inputs can include quoted prices for similar assets or liabilities in active markets or quoted prices for identical assets or liabilities in markets that are not active. Related inputs can also include those used in valuation or other pricing models, such as interest rates and yield curves that can be corroborated by observable market data. Level 3— Fair value is determined by inputs that are unobservable and not corroborated by market data. Use of these inputs involves significant and subjective judgments to be made by the reporting entity –e.g. determining an appropriate discount factor for illiquidity associated with a given security. The Company measures the fair value of financial assets using the highest level of inputs that are reasonably available as of the measurement date. The assets recorded at fair value are classified within the hierarchy as follows for the periods reported (in thousands): September 30, 2018 December 31, 2017 Total Total Fair Value Level 1 Level 2 Fair Value Level 1 Level 2 Money Market Funds $ 15,632 $ 15,632 $ — $ 5,175 $ 5,175 $ — Corporate Securities 98,028 — 98,028 123,270 — 123,270 Government Securities 414,805 — 414,805 223,530 — 223,530 $ 528,465 $ 15,632 $ 512,833 $ 351,975 $ 5,175 $ 346,800 Our policy is to record transfers of assets between Level 1 and Level 2 at their fair values as of the end of each reporting period, consistent with the date of the determination of fair value. During the three and nine months ended September 30, 2018 and 2017, there were no transfers between Level 1 and Level 2. The Company does not have any Level 3 assets or liabilities.

Net Income (Loss) Per Share

Net Income (Loss) Per Share	9 Months Ended
	Sep. 30, 2018
Net Income (Loss) Per Share
Net Income (Loss) Per Share	3. Net Income (Loss) Per Share We compute net income (loss) per common share by dividing the net income (loss) attributable to common stockholders by the weighted-average number of common shares outstanding during the period without consideration of common stock equivalents. Diluted net income (loss) per share is computed by dividing the net income (loss) attributable to common stockholders by the weighted-average number of common stock equivalents outstanding for the period. The treasury stock method is used to determine the dilutive effect of the Company’s stock option grants. Potentially dilutive securities consisting of stock issuable under options and our 2013 Employee Stock Purchase Plan (ESPP) are not included in the per common share calculation in periods where there is a net loss where the inclusion of such shares would have had an antidilutive effect. Basic and diluted net income (loss) per common share is computed as follows (in thousands except share and per share data): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 (As Revised) (As Revised) (in thousands, except share and per share data) Numerator: Net income (loss) attributable to common stockholders $ 3,150 $ (22,652) $ (52,210) $ (45,853) Denominator: Weighted-average common shares outstanding used in computing basic net income (loss) 55,974,080 46,929,498 53,165,774 46,766,562 Weighted-average common shares outstanding used in computing diluted net income (loss) 58,313,002 46,929,498 53,165,774 46,766,562 Basic net income (loss) per common share $ 0.06 $ (0.48) $ (0.98) $ (0.98) Diluted net income (loss) per common share $ 0.05 $ (0.48) $ (0.98) $ (0.98) For the three months ended September 30, 2018 potentially dilutive securities consisting of stock options were included in the diluted net income per common share calculation. For the three months ended September 30, 2017 and nine months ended September 30, 2018 and 2017, all outstanding potentially dilutive securities have been excluded from the calculation of diluted net loss per common share as the effect of including such securities would have been antidilutive. The table below summarizes the number of common stock equivalents included in the calculation of the weighted-average common shares outstanding used in computing diluted net income (loss): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 (in thousands) (in thousands) Options to purchase common stock 2,339 — — —

Comprehensive Income (Loss)

Comprehensive Income (Loss)	9 Months Ended
	Sep. 30, 2018
Comprehensive Income (Loss)
Comprehensive Income (Loss)	4. Comprehensive Income (Loss) Comprehensive income (loss) is comprised of net income (loss) and other comprehensive income (loss). For the three and nine months ended September 30, 2018 and 2017, the only component of other comprehensive income (loss) is net unrealized gain (loss) on marketable securities. There were no material reclassifications out of accumulated other comprehensive income (loss) during the three and nine months ended September 30, 2018 and 2017.

Marketable Securities

Marketable Securities	9 Months Ended
	Sep. 30, 2018
Marketable Securities
Marketable Securities	5. Marketable Securities The Company’s marketable securities held as of September 30, 2018 and December 31, 2017 are summarized below: Gross Gross Amortized Unrealized Unrealized September 30, 2018 Cost Gains Losses Fair Value (in thousands) Money Market Funds $ 15,632 $ — $ — $ 15,632 Corporate Securities 98,498 1 (471) 98,028 Government Securities 416,664 — (1,859) 414,805 $ 530,794 $ 1 $ (2,330) $ 528,465 Reported as Cash and cash equivalents $ 15,632 Marketable securities 512,833 Total investments $ 528,465 Gross Gross Amortized Unrealized Unrealized December 31, 2017 Cost Gains Losses Fair Value (in thousands) Money Market Funds $ 5,175 $ — $ — $ 5,175 Corporate Securities 123,860 — (590) 123,270 Government Securities 224,739 — (1,209) 223,530 $ 353,774 $ — $ (1,799) $ 351,975 Reported as Cash and cash equivalents $ 5,175 Marketable securities 346,800 Total investments $ 351,975 The maturities of the Company’s marketable securities are as follows: Amortized Estimated September 30, 2018 Cost Fair Value (in thousands) Mature in one year or less $ 237,736 $ 236,605 Mature within two years 277,426 276,228 $ 515,162 $ 512,833 The unrealized losses on available-for-sale investments and their related fair values as of September 30, 2018 and December 31, 2017 are as follows: Less than 12 months 12 months or greater September 30, 2018 Fair value Unrealized losses Fair value Unrealized losses (in thousands) Corporate Securities $ 69,494 $ (411) $ 28,534 $ (60) Government Securities 167,111 (720) 247,694 (1,139) $ 236,605 $ (1,131) $ 276,228 $ (1,199) Less than 12 months 12 months or greater December 31, 2017 Fair value Unrealized losses Fair value Unrealized losses (in thousands) Corporate Securities $ 79,290 $ (137) $ 43,980 $ (453) Government Securities 128,313 (461) 95,217 (748) $ 207,603 $ (598) $ 139,197 $ (1,201) The unrealized losses from the listed securities are due to a change in the interest rate environment and not a change in the credit quality of the securities. The Company does not intend to sell these securities, and it is not more likely than not that the Company will be required to sell the securities before recovery of the amortized cost basis. Therefore, the Company did not consider these securities to be other-than-temporarily impaired as of September 30, 2018 and December 31, 2017.

Sale of Additional Common Stock

Sale of Additional Common Stock	9 Months Ended
	Sep. 30, 2018
Sale of Additional Common Stock
Sale of Additional Common Stock	6. Sale of Additional Common Stock In March 2018, we completed the sale of 8,395,000 shares of common stock which included shares issued pursuant to our underwriters’ exercise of their over-allotment option pursuant to a follow-on financing. We received net proceeds of $245.5 million after underwriting discounts, commissions and offering expenses.

Stock-Based Compensation

Stock-Based Compensation	9 Months Ended
	Sep. 30, 2018
Stock-Based Compensation
Stock-Based Compensation	7. Stock Based Compensation Our Board of Directors and the requisite stockholders previously approved the 2010 Equity Incentive Plan (the 2010 Plan). In October 2013, our Board of Directors approved the 2013 Equity Incentive Plan (the 2013 Plan) and in November 2013 our stockholders approved the 2013 Plan which became effective as of December 3, 2013. As of December 2, 2013, we suspended the 2010 Plan and no additional awards may be granted under the 2010 Plan. Any shares of common stock covered by awards granted under the 2010 Plan that terminate after December 2, 2013 by expiration, forfeiture, cancellation or other means without the issuance of such shares will be added to the 2013 Plan reserve. As of September 30, 2018, the total number of shares of common stock available for issuance under the 2013 Plan is 9,618,155 which includes 2,684,456 shares of common stock that were available for issuance under the 2010 Plan as of the effective date of the 2013 Plan. Unless otherwise determined by the Board, beginning January 1, 2014, and continuing until the expiration of the 2013 Plan, the total number of shares of common stock available for issuance under the 2013 Plan will automatically increase annually on January 1 of each year by 4% of the total number of issued and outstanding shares of common stock as of December 31 of the immediate preceding year. Pursuant to approval by our board on January 1, 2018, the total number of shares of common stock available for issuance under the 2013 Plan was increased by 1,880,100 shares. As of September 30, 2018, a total of 6,624,750 options have been issued under the 2013 Plan. In November 2013, our Board of Directors and stockholders approved the 2013 Employee Stock Purchase Plan (ESPP), which became effective as of December 5, 2013. We have reserved a total of 581,286 shares of common stock for issuance under the ESPP. Unless otherwise determined by our Board, beginning on January 1, 2014, and continuing until the expiration of the ESPP, the total number of shares of common stock available for issuance under the ESPP will automatically increase annually on January 1 by the lesser of (i) 1% of the total number of issued and outstanding shares of common stock as of December 31 of the immediately preceding year, or (ii) 621,814 shares of common stock. Pursuant to approval by our board, there was no increase in the number of authorized shares in the ESPP in 2018. As of September 30, 2018, we have issued a total of 318,945 shares of common stock under the ESPP. During the nine months ended September 30, 2018, the Company awarded 33,933 Restricted Stock Units (RSUs) to certain employees. Vesting of these awards will be in three equal annual installments and is contingent on continued employment terms. The fair value of these awards is determined based on the intrinsic value of the stock on the date of grant and will be recognized as stock-based compensation expense over the requisite service period. Total employee, director and non-employee stock-based compensation expense recognized for the three and nine months ended September 30, 2018 and 2017 are as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 General and administrative $ 2,732 $ 1,422 $ 6,037 $ 4,305 Research and development 3,388 2,183 9,436 5,906 $ 6,120 $ 3,605 $ 15,473 $ 10,211 Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Stock options $ 5,832 $ 3,462 $ 14,723 $ 9,820 ESPP 209 143 562 391 Restricted stock units 79 — 188 — $ 6,120 $ 3,605 $ 15,473 $ 10,211 The following table summarizes option activity under our stock plans and related information: Weighted Weighted Average Average Number of Exercise Remaining Aggregate Shares subject Price Contractual Intrinsic to outstanding (Per Term Value options Share) (in years) (in thousands) Balances at December 31, 2017 5,093,442 $ 15.32 7.62 Options granted 1,679,400 $ 26.63 Options forfeited (107,720) $ 21.66 Options exercised (788,409) $ 8.96 Balance at September 30, 2018 5,876,713 $ 19.29 7.70 $ 115,992 Exercisable 2,857,873 $ 14.76 6.56 $ 69,180 We calculate the intrinsic value as the difference between the exercise price of the options and the closing price of common stock of $38.97 per share as of September 30, 2018. Weighted average fair value of options granted during the nine-month period ended September 30, 2018 and 2017 was $17.57 and $16.91 per share, respectively. There were 1,438,100 options granted during the nine-month period ended September 30, 2017. We estimated the fair value of each stock option using the Black-Scholes option-pricing model based on the date of grant of such stock option with the following weighted average assumptions for the three and nine months ended September 30, 2018 and 2017: Options Options Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Expected term (years) 6.1 6.1 6.1 6.1 Expected volatility 72.8 % 96.7 % 73.1 % 89.8 % Risk-free interest rate 2.87 % 1.95 % 2.56 % 2.03 % Expected dividend yield — % — % — % — % ESPP ESPP Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Expected term (years) 0.5 - 2.0 0.5 - 2.0 0.5 - 2.0 0.5 - 2.0 Expected volatility 61.2 - 71.4 % 67.8 - 79.8 % 61.2 - 71.4 % 67.8 - 79.8 % Risk-free interest rate 1.47 - 2.41 % .47 - 1.09 % 1.47 - 2.41 % .47 - 1.09 % Expected dividend yield — % — % — % — % As of September 30, 2018, the unamortized compensation expense related to unvested stock options was $44.5 million. The remaining unamortized compensation expense will be recognized over the next 2.8 years. As of September 30, 2018, the unamortized compensation expense under our ESPP was $1.0 million. The remaining unamortized expense will be recognized over the next 1.2 years. The following table summarizes the restricted stock unit activity for the nine-month period ended September 30, 2018: Weighted Restricted Average Grant Stock Date Fair Value Units (Per unit) Unvested at December 31, 2017 — $ — Granted 33,933 $ 27.64 Vested — $ — Forfeited — $ — Unvested at September 30, 2018 33,933 $ 27.64 As of September 30, 2018, the unamortized compensation expense related to unvested restricted stock units was $0.75 million. The remaining unamortized expense will be recognized over the next 2.4 years.

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2018
Commitments and Contingencies
Commitments and Contingencies	8. Commitments and Contingencies Operating Leases The Company leases office and laboratory space in Monrovia, CA through June 2020. In July 2017, the Company entered into an amended lease agreement for additional space in the same building. The amended lease has a 64-month term with an option to renew for an additional five years. The lease terms for the original space were not amended. The Company also leases office space in San Diego, CA through June 2020. In June 2017, the Company entered into a new lease agreement for additional office space. The new lease has a 61-month term beginning from the date of occupancy and includes an option to renew for an additional five years. At September 30, 2018 the future minimum lease payments under the operating leases were as follows: Years ending December 31, For the remainder of the fiscal year $ 471 2019 2,752 2020 2,404 2021 1,980 2022 1,406 Rent expense for the nine months ended September 30, 2018 and 2017 was $1.9 million and $1.1 million respectively. Commitments From time to time, the Company may be subject to various litigation and related matters arising in the ordinary course of business. The Company does not believe it is currently subject to any material matters where there is at least a reasonable possibility that a material loss may be incurred. We are obligated to make future payments to third parties under in‑license agreements, including sublicense fees, royalties, and payments that become due and payable on the achievement of certain development and commercialization milestones. As the amount and timing of sublicense fees and the achievement and timing of these milestones are not probable and estimable, such commitments have not been included on our balance sheet. We have also entered into agreements with third-party vendors which will require us to make future payments upon the delivery of goods and services in future periods.

Collaboration and Licensing Agr

Collaboration and Licensing Agreements	9 Months Ended
	Sep. 30, 2018
Collaboration and Licensing Agreements
Collaboration and Licensing Agreements	9. Collaboration and Licensing Agreements Following is a summary description of the material revenue arrangements, including arrangements that generated revenue in the nine months ended September 30, 2018 and 2017. The revenue reported for each agreement has been adjusted to reflect the adoption of ASC 606 for each period presented. Novartis In June 2016, the Company entered into a Collaboration and License Agreement (the Novartis Agreement) with Novartis Institutes for BioMedical Research, Inc. (Novartis), to develop and commercialize bispecific and other Fc modulated antibody drug candidates using the Company’s proprietary XmAb® technologies and drug candidates. Pursuant to the Novartis Agreement: · The Company granted Novartis certain exclusive rights to research, develop and commercialize XmAb14045 and XmAb13676, two development stage products that incorporate the Company’s bispecific Fc technology; · The Company will apply its bispecific technology in up to four target pair antibodies identified by Novartis (each a Global Discovery Program); and · The Company will provide Novartis with a non-exclusive license to certain of its Fc technologies to apply against up to ten targets identified by Novartis. The Company received a non-refundable upfront payment under the Novartis Agreement of $150 million in July 2016 and is eligible to receive up to $2.4 billion in future development, regulatory and sales milestones in total for all programs that could be developed under the Novartis Agreement. The Company evaluated the Novartis Agreement under the new revenue recognition standard ASC 606 and concluded that Novartis is a customer. The Company identified the following performance obligations that it deemed to be distinct at the inception of the contract: · License to certain rights to Xencor’s XmAb14045 and XmAb13676; · Develop four bispecific drug candidates against four targets identified by Novartis (each a Global discovery program); and · License to Xencor’s Fc technologies for up to 10 targets identified and selected by Novartis. The Company considered the licenses as functional intellectual property as Novartis has the right to access its technology and such technology is functional to Novartis at the time that Xencor provides access. Under the Novartis Agreement, Novartis has substitution rights under each discovery program provided it has not advanced to filing an investigational new drug (IND) application. The Company’s obligation to provide services related to the discovery programs, and Novartis’ right to substitute programs is limited to the five-year period from the date of the Novartis agreement. The Company determined the transaction price at inception is the $150 million upfront payment to be allocated to the performance obligations. The Novartis agreement includes variable consideration for potential future milestones and royalties that were contingent on future success factors for development programs. The Company used the “most likely” method to determine the variable consideration. None of the development, regulatory or sales milestones or royalties were included in the transaction price. The Company will re-evaluate the transaction price in each reporting period as uncertain events are resolved or other changes in circumstances occur. The Company determined the transaction price at inception of the Novartis Agreement and allocated it to the various performance obligations using the standalone selling price which is comparable to the relative selling price methodology used in the original accounting treatment for the transaction. The transaction price of $150 million was allocated to the performance obligations as follows: * $27.1 million to certain rights to the XmAb14045 Program; * $31.4 million to certain rights to the XmAb13676 Program; * $20.05 million to each of the four Global Discovery Programs; and * $11.3 million to the Fc licenses. Under ASC 606, revenue is recognized at the time that the Company’s performance obligation for each Global Discovery is completed upon delivery of each discovery program to Novartis. Xencor delivered a discovery program to Novartis in 2017 and recognized $20.05 million of revenue in the period of delivery. In the third quarter of 2018, Xencor delivered a second discovery program to Novartis and is recognizing an additional $20.04 million of revenue. Under ASC 606 the entire amount of revenue allocated to the Fc licenses is being recognized at inception of the Novartis Agreement, the second quarter of 2016. During the three and nine months ended September 30, 2018, we recognized $20.04 million of revenue related to the Novartis Agreement. There were no revenues recognized during the three and nine-month periods ended September 30, 2017. As of September 30, 2018, there is $40.1 million in deferred revenue related to the arrangement. Amgen, Inc. In September 2015, the Company entered into a research and license agreement (the Amgen Agreement) with Amgen, Inc. (Amgen) to develop and commercialize bispecific antibody product candidates using the Company’s proprietary XmAb® bispecific Fc technology. Under the Amgen Agreement, the Company granted an exclusive license to Amgen to develop and commercialize bispecific drug candidates from the Company’s preclinical program that bind the CD38 antigen and the cytotoxic T-cell binding domain CD3 (the CD38 Program). The Company also agreed to apply its bispecific technology to five previously identified Amgen provided targets (each a Discovery Program). The Company received a $45.0 million upfront payment from Amgen and is eligible to receive up to $1.7 billion in future development, regulatory and sales milestones in total for all six programs and is eligible to receive royalties on any global net sales of products. Pursuant to the Amgen Agreement, the Company applied its bispecific technology to five Discovery Programs antibody molecules provided by Amgen that bind Discovery Program Targets and returned the bispecific product candidates to Amgen for further testing, development and commercialization. The initial research term is three years from the date of the Amgen Agreement, but Amgen, at its option, may request an extension of one year. In May 2018, Amgen notified the Company that it was electing to extend the term of the research term for one year. Pursuant to the Agreement, Amgen and the Company will agree upon a detailed plan for services to be provided by the Company during the extended research term. The Company will receive research funding for the additional services provided during the extended research term. Amgen will assume full responsibility for development and commercialization of product candidates under each of the Discovery Programs. The Company evaluated the Amgen Agreement under ASC 606 and determined that it is a customer and that delivery of the CD38 Program and each of the five Discovery Programs represent the performance obligations under the contract. The Company determined the transaction price at inception is the $45 million upfront payment to be allocated to the performance obligations. The Amgen Agreement includes variable consideration for potential future milestones and royalties that were contingent on future success factors for development programs. The Company used the “most likely” method to determine the variable consideration. In the fourth quarter of 2017, the Company received a $10 million development milestone related to the CD38 program and this payment was included in the transaction price as uncertainty associated with it has been resolved. No other development, regulatory or sales milestones or royalties were included in the transaction price. The Company will re-evaluate the transaction price in each reporting period and as uncertain events are resolved or other changes in circumstances occur. In allocating the transaction price determined at inception, the Company determined that ASC 606 provides the use of a standalone selling price for the transaction. The transaction price of $55 million was allocated to the performance obligations as follows: * $23.75 million to the CD38 Program and * $6.25 million to each of the five Discovery Programs Under ASC 606, the amount of revenue recognized for the CD38 program is recognized at the inception of the contract when delivery of the CD38 Program and materials was transferred to Amgen. The $10 million milestone revenue was recognized in the period that the uncertainty regarding the event is resolved, i.e., when the milestone event occurred. The Company completed performance obligations for the five discovery programs in 2016 when all five of the Discovery Programs were delivered to Amgen. Pursuant to ASC 606 the Company recognized $31.25 million of revenue for delivery of the five discovery programs in 2016. In the third quarter of 2018, the Company and Amgen agreed upon additional scope of work to be performed by Xencor; however, no work has been performed to date. The Company did not recognize any revenue for each of the three and nine months ended September 30, 2018 and 2017. There is no deferred revenue as of September 30, 2018 related to this arrangement. Alexion Pharmaceuticals, Inc. In January 2013, we entered into an option and license agreement with Alexion Pharmaceuticals, Inc. (Alexion). Under the terms of the agreement, we granted to Alexion an exclusive research license, with limited sublicensing rights, to make and use our Xtend technology to evaluate and advance compounds against six different target programs during a five-year research term under the agreement, up to completion of the first multi-dose human clinical trial for each target compound. Under the agreement, we received an upfront payment of $3.0 million and annual maintenance fees totaling $2 million during the research term. We are also eligible to receive development, regulatory and commercial milestones. If licensed products are successfully commercialized, we are entitled to receive royalties based on a percentage of net sales of such products sold by Alexion, its affiliates or its sub licensees, which percentage is in the low single digits. Alexion’s royalty obligations will continue on a product‑by‑product and country‑by‑country basis until the expiration of the last‑to‑expire valid claim in a licensed patent covering the applicable product in such country. In the third quarter of 2014, Alexion achieved a Phase 1 milestone with ALXN1210, a compound that incorporates our Xtend technology. In the fourth quarter of 2015, Alexion exercised its option to take an exclusive commercial license to ALXN1210 and achieved a Phase 2 clinical development milestone for ALXN1210. In December 2016, Alexion achieved a Phase 3 clinical development milestone for ALXN1210. In the third quarter of 2018, Alexion completed certain regulatory submission filings for ALXN1210 and the Company received $9 million in milestone payments. The Company determined Alexion to be a customer and the license of the Company’s Xtend intellectual property is functional intellectual property, distinct and is the only performance obligation under the agreement. The upfront fee, the net present value of the annual maintenance fees, the option exercise fee and milestone payments of $17.5 million already received represent the total transaction price at inception. The option exercise fee does not provide a discount on future services and does not grant a material right. Under ASC 606 the upfront payment and the present value of the annual licensing fees are recognized at inception of the agreement when Alexion was provided access to the technology. During the three and nine months ended September 30, 2018 the Company recognized $9 million of milestone revenues. For the same periods in 2017, no revenue was recognized under this arrangement. There is no deferred revenue related to this arrangement at September 30, 2018. CSL Limited In February 2009, we entered into a research license and commercialization agreement with CSL Limited (CSL). Under the agreement, we provided CSL with a research license to our Fc Cytotoxic technology and options to non-exclusive commercial licenses. CSL elected to exercise one commercial license for a compound, CSL362. In 2013 CSL sublicensed CSL362 (now called talacotuzumab) to Janssen Biotech Inc. (Janssen Biotech). In March 2017, CSL, through its sub-licensee, Janssen Biotech, initiated a Phase 3 clinical trial for CSL362 and we received a milestone payment of $3.5 million. During the three and nine months ended September 30, 2018, there were no revenues recognized. During the three and nine months ended September 30, 2017 we recognized zero and $3.5 million of revenue, respectively, under the arrangement. There is no deferred revenue related to this arrangement at September 30, 2018.

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2018
Income Taxes
Income Taxes	10. Income taxes There is no provision for income taxes for the three and nine-month periods ended September 30, 2018. No income tax benefit can be recognized in these periods due to uncertainty about the Company’s ability to generate taxable income in future periods. The provision for income taxes for the three and nine months ended September 30, 2017 represents the interim period tax allocation of the federal and state alternative minimum tax based on the Company’s projected year-end effective income tax rates which cannot be offset by the Company’s net operating loss carryforwards. The Company has a federal income tax receivable of $1.5 million at September 30, 2018 related to refundable alternative minimum tax credits. As of September 30, 2018, the Company’s deferred income tax assets, consisting primarily of net operating loss and tax credit carryforwards, have been fully offset by a valuation allowance.

Prior-Period Financial Statemen

Prior-Period Financial Statements	9 Months Ended
	Sep. 30, 2018
Prior-Period Financial Statements
Prior-Period Financial Statements	11. Prior-Period Financial Statements The Company adopted ASC 606 on January 1, 2018 using the full retrospective method and as a result the Company has revised its comparative financial statements for the prior period as if ASC 606 had been in effect for that period. The most significant changes to revenue recognition under ASC 606 relate to the timing of revenue recognized for arrangements that include licensing of our technologies. Under ASC 606 revenue related to licensing of access to our technologies is recognized at inception of the agreement, generally the effective date of the agreement. For existing licensing arrangements, the effect of ASC 606 is to shift revenue to earlier periods. Approximately $11.3 million of licensing revenue that was being recognized over the five-year period 2016-2021 is being recognized in the second quarter of 2016. The other significant change under ASC 606 relates to the timing of collaboration revenue when the Company completes its performance obligations for delivery of a drug candidate to its collaboration partners after applying its technologies. For existing collaborations, the effect of ASC 606 is to accelerate revenue recognition to earlier periods. Approximately $6.25 million of collaboration revenue recognized in 2017 and 2018 under historical accounting guidance is being recognized in 2016 under ASC 606. An additional $20.5 million of collaboration revenue that would be recognized in 2018 is being recognized in 2017. The following tables summarize the effects of adopting ASC topic 606 on our financial statements. As Reported Effect of Adoption of As Revised 2017 ASC 606 2017 Assets Current assets Cash and cash equivalents $ 16,528 $ — $ 16,528 Marketable securities 207,603 — 207,603 Accounts receivable 1,142 — 1,142 Prepaid expenses and other current assets 5,606 — 5,606 Total current assets 230,879 — 230,879 Property and equipment, net 7,088 — 7,088 Patents, licenses, and other intangible assets, net 11,148 — 11,148 Marketable securities - long term 139,198 — 139,198 Income tax receivable 1,524 — 1,524 Loan receivable — 86 86 Interest receivable — 14 14 Other assets 265 — 265 Total assets $ 390,102 $ 100 $ 390,202 Liabilities and stockholders’ equity Current liabilities Accounts payable $ 6,869 $ — $ 6,869 Accrued expenses 5,480 — 5,480 Current portion of deferred rent 26 — 26 Current portion of deferred revenue 88,813 (28,695) 60,118 Income taxes 157 — 157 Total current liabilities 101,345 (28,695) 72,650 Deferred rent, less current portion 1,088 — 1,088 Deferred revenue, less current portion 5,623 (5,623) — Total liabilities 108,056 (34,318) 73,738 Commitments and contingencies Stockholders’ equity Preferred stock, $0.01 par value: 10,000,000 authorized shares; -0- issued and outstanding shares at December 31, 2017 — — — Common stock, $0.01 par value: 200,000,000 authorized shares at December 31, 2017; 47,002,488 issued and outstanding at December 31, 2017 470 — 470 Additional paid-in capital 570,670 — 570,670 Accumulated other comprehensive income loss (1,808) — (1,808) Accumulated deficit (287,286) 34,418 (252,868) Stockholders’ equity 282,046 34,418 316,464 Total liabilities and stockholders’ equity $ 390,102 $ 100 $ 390,202 As Reported As Revised Three Months Ended Effect of Three Months Ended September 30, Adoption of September 30, 2017 ASC 606 2017 Revenue Collaborations, licenses and milestones $ 7,090 $ (7,090) $ — Operating expenses Research and development 19,408 — 19,408 General and administrative 4,172 — 4,172 Total operating expenses 23,580 — 23,580 Loss from operations (16,490) (7,090) (23,580) Other income (expenses) Interest income 1,048 — 1,048 Interest expense (3) — (3) Other income 56 — 56 Total other income, net 1,101 — 1,101 Loss before income tax expense (15,389) (7,090) (22,479) Income tax expense 173 — 173 Net loss (15,562) (7,090) (22,652) Other comprehensive income (loss) Net unrealized loss on marketable securities 143 — 143 Comprehensive loss $ (15,419) $ (7,090) $ (22,509) Basic and diluted net loss per common share $ (0.33) $ (0.15) $ (0.48) As Reported As Revised Nine Months Ended Effect of Nine Months Ended September 30, Adoption of September 30, 2017 ASC 606 2017 Revenue Collaborations, licenses and milestones $ 24,771 $ (8,771) $ 16,000 Operating expenses Research and development 51,376 — 51,376 General and administrative 13,074 — 13,074 Total operating expenses 64,450 — 64,450 Loss from operations (39,679) (8,771) (48,450) Other income (expenses) Interest income 3,142 — 3,142 Interest expense (8) — (8) Other income 86 — 86 Total other income, net 3,220 — 3,220 Loss before income tax expense (36,459) (8,771) (45,230) Income tax expense 623 — 623 Net loss (37,082) (8,771) (45,853) Other comprehensive income (loss) Net unrealized gain on marketable securities 344 — 344 Comprehensive loss $ (36,738) $ (8,771) $ (45,509) Basic and diluted net loss per common share $ (0.79) $ (0.19) $ (0.98) Accumulated Additional Other Total Common Stock Paid Comprehensive Accumulated Stockholders’ Stockholders’ Equity Shares Amount in-Capital Loss Deficit Equity Balance, December 31, 2016 as originally reported 46,567,978 $ 466 $ 552,889 $ (1,441) $ (237,960) $ 313,954 Adoption of ASU 2016-09 — — 401 — (401) — Adoption of ASC 606 — — — — 23,979 23,979 Balance, December 31, 2016 as revised 46,567,978 466 553,290 (1,441) (214,382) 337,933 Issuance of common stock upon exercise of stock awards 363,603 4 2,793 — — 2,797 Issuance of common stock under the Employee Stock Purchase Plan 70,907 — 936 — — 936 Comprehensive loss — — — (367) (48,925) (49,292) Stock-based compensation — — 13,651 — — 13,651 Balance, December 31, 2017 47,002,488 $ 470 $ 570,670 $ (1,808) $ (263,307) $ 306,025 Adoption of ASC topic 606 — — — — 10,439 10,439 Balance, December 31, 2017 as revised 47,002,488 $ 470 $ 570,670 $ (1,808) $ (252,868) $ 316,464 As Reported As Revised Nine Months Ended Effect of Nine Months Ended September 30, Adoption of September 30, 2017 ASC 606 2017 Cash flows from operating activities Net loss $ (37,082) $ (8,771) $ (45,853) Adjustments to reconcile net loss to net cash (used in) provided by operating activities: Depreciation and amortization 1,420 — 1,420 Amortization of premium on marketable securities 2,148 — 2,148 Stock-based compensation 10,211 — 10,211 Abandonment of capitalized intangible assets 273 — 273 Gain on disposal of assets (2) — (2) Gain on sale of marketable securities available for sale — — — Changes in operating assets and liabilities: Accounts receivable 7,785 — 7,785 Interest receivable (588) (14) (602) Prepaid expenses and other assets (3,971) — (3,971) Accounts payable 2,722 — 2,722 Accrued expenses (2,056) — (2,056) Income taxes (65) — (65) Deferred rent 359 — 359 Deferred revenue (8,171) 8,871 700 Net cash used in operating activities (27,017) 86 (26,931) Cash flows from investing activities Purchase of marketable securities (49,203) — (49,203) Purchase of intangible assets (1,520) — (1,520) Purchase of property and equipment (3,834) — (3,834) Proceeds from sale of property and equipment 2 — 2 Proceeds from sale and maturities of marketable securities 77,566 — 77,566 Issuance of loan — (86) (86) Net cash provided by investing activities 23,011 (86) 22,925 Cash flows from financing activities Proceeds from issuance of common stock upon exercise of stock awards 2,669 — 2,669 Proceeds from issuance of common stock under the Employee Stock Purchase Plan 443 — 443 Net cash provided by financing activities 3,112 — 3,112 Net increase in cash and cash equivalents (894) — (894) Cash and cash equivalents , beginning of period 14,528 — 14,528 Cash and cash equivalents , end of period $ 13,634 $ — $ 13,634

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Polices)	9 Months Ended
	Sep. 30, 2018
Summary of Significant Accounting Policies
Basis of Presentation	Basis of Presentation The accompanying unaudited interim financial statements for Xencor, Inc. (the Company) have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information. Certain amounts in the prior period financial statements have been revised to conform to the presentation of the current period financial statements. See “Recent Accounting Pronouncements – Pronouncements Adopted in 2018. ” The financial statements include all adjustments (consisting only of normal recurring adjustments) that the management of the Company believes are necessary for a fair presentation of the periods presented. The preparation of interim financial statements requires the use of management’s estimates and assumptions that affect reported amounts of assets and liabilities at the date of the interim financial statements and the reported revenues and expenditures during the reported periods. These interim financial results are not necessarily indicative of the results expected for the full fiscal year or for any subsequent interim period. The accompanying unaudited interim financial statements and related notes should be read in conjunction with the audited financial statements and notes thereto included in the Company’s 2017 Annual Report on Form 10-K filed with the Securities and Exchange Commission (SEC) on February 28, 2018.
Use of Estimates	Use of Estimates The preparation of interim financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, other comprehensive gain (loss) and the related disclosures. On an ongoing basis, management evaluates its estimates, including estimates related to its accrued clinical trial and manufacturing development expenses, stock-based compensation expense, intangible assets and related amortization. Significant estimates in these interim financial statements include estimates made for accrued research and development expenses, stock-based compensation expenses, intangible assets and related amortization.
Intangible Assets	Intangible Assets The Company maintains definite-lived intangible assets related to certain capitalized costs of acquired licenses and third-party costs incurred in establishing and maintaining its intellectual property rights to its platform technologies and development candidates. These assets are amortized over their useful lives, which are estimated to be the remaining patent life or the contractual term of the license. The straight-line method is used to record amortization expense. The Company assesses its intangible assets for impairment if indicators are present or changes in circumstances suggest that impairment may exist. There were no impairment charges recorded for the three and nine-months ended September 30, 2018 and 2017. The Company capitalizes certain in-process intangible assets that are abandoned when they are no longer pursued. During the nine months ended September 30, 2018 and 2017, the Company abandoned $0.1 million and $0.3 million, respectively, of in-process intangible assets.
Marketable Securities	Marketable Securities The Company has an investment policy that includes guidelines on acceptable investment securities, minimum credit quality, maturity parameters and concentration and diversification. The Company invests its excess cash primarily in marketable securities issued by investment grade institutions. The Company considers its marketable securities to be available-for-sale. These assets are carried at fair value and the unrealized gains and losses are included in accumulated other comprehensive income (loss). Accrued interest on marketable securities is included in marketable securities. If a decline in the value of a marketable security in the Company’s investment portfolio is deemed to be other-than-temporary, the Company writes down the security to its current fair value and recognizes a loss as a charge against income. The Company reviews its portfolio of marketable securities, using both quantitative and qualitative factors, to determine if declines in fair value below cost are other-than-temporary.
Recent Accounting Pronouncements	Recent Accounting Pronouncements Pronouncements Adopted in 2018 Effective January 1, 2018, the Company adopted Accounting Standards Codification Topic 606 (ASC 606), Revenue from Contracts with Customers , using the full retrospective transition method. Under this method, the Company is presenting its financial statements for the years ended December 31, 2016 and 2017 and applicable interim periods within the year ended 2017 as if ASC 606 had been effective for those periods. Under ASC 606 an entity recognizes revenue when its customer obtains control of promised goods or services in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. A five-step model is used to achieve the core principle: (1) identify the customer contract, (2) identify the contract’s performance obligations, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations and (5) recognize revenue when or as a performance obligation is satisfied. The Company applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. The new guidance provides that revenue recognition for performance obligations related to delivery of certain goods or services occurs when control over the good or service is transferred to the customer. In addition, the timing of revenue recognition from licensing of our intellectual property that are functional and are distinct performance obligations changed from being recognized over the term of access to our license or technology to being recognized at a point in time. See Note 11 “Prior-Period Financial Statements” for a complete discussion of the impact of adopting the new standard. Effective January 1, 2018, the Company adopted ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, which addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. The adoption of this standard did not have an effect on the Company’s statements of cash flow. Effective January 1, 2018, the Company adopted ASU No. 2017-09, Compensation – Stock Compensation (Topic 718) . The standard applies when a company changes the terms of a stock compensation award granted to an employee. The Company did not have any modifications upon adopting the new standard; therefore, adoption of the new standard had no effect on the Company’s financial statements. Pronouncements Not Yet Effective In February 2016, the FASB issued ASU No. 2016-02 Leases . The new guidance requires lessees to recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term for all leases not considered short term. The new standard will be effective for reporting periods beginning after December 15, 2018. In July 2018, the FASB issued ASU 2018-11, Lease (Topic 842): Targeted Improvements, which provides an alternative transition method of adoption, permitting the recognition of cumulative-effect adjustment to retained earnings on the date of adoption. We are currently evaluating our leases which includes a review of our lease expenses, which are primarily operating lease arrangements for our facilities in Monrovia and San Diego . We intend to adopt the standard on the effective date but have not yet selected a transition method. In June 2018, the FASB issued ASU No. 2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting, which expands the scope of Topic 718 to include share-based payments issued to nonemployees for goods and services. The standard is effective for fiscal years beginning after December 15, 2018 and interim periods within such fiscal year. The Company does not anticipate that the standard will have a significant impact on its financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement, which modifies the disclosures for transfers between Level 1 and Level 2 of the fair value hierarchy, modifies the level 3 disclosure requirements for non-public entities and requires additional disclosure for Level 3 fair value hierarchy. The amendment is effective for fiscal years beginning after December 15, 2019. The Company does not anticipate that the standard will have a significant impact on its financial statements. In August 2018, the FASB issued ASU No. 2018-15, Intangibles – Goodwill and Other – Internal Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract, which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). The accounting for the service element of a hosting arrangement that is a service contract is not affected by the amendment. The amendment is effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2019. The Company does not anticipate that the standard will have a significant impact on its financial statements. There have been no other material changes to the significant accounting policies previously disclosed in the Company’s 2017 Annual Report on Form 10-K.

Fair Value of Financial Instr_2

Fair Value of Financial Instruments (Tables)	9 Months Ended
	Sep. 30, 2018
Fair Value of Financial Instruments
Schedule of assets recorded at fair value	The assets recorded at fair value are classified within the hierarchy as follows for the periods reported (in thousands): September 30, 2018 December 31, 2017 Total Total Fair Value Level 1 Level 2 Fair Value Level 1 Level 2 Money Market Funds $ 15,632 $ 15,632 $ — $ 5,175 $ 5,175 $ — Corporate Securities 98,028 — 98,028 123,270 — 123,270 Government Securities 414,805 — 414,805 223,530 — 223,530 $ 528,465 $ 15,632 $ 512,833 $ 351,975 $ 5,175 $ 346,800

Net Income (Loss) Per Share (Ta

Net Income (Loss) Per Share (Tables)	9 Months Ended
	Sep. 30, 2018
Net Income (Loss) Per Share
Schedule of basic and diluted net income (loss) per common share	Basic and diluted net income (loss) per common share is computed as follows (in thousands except share and per share data): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 (As Revised) (As Revised) (in thousands, except share and per share data) Numerator: Net income (loss) attributable to common stockholders $ 3,150 $ (22,652) $ (52,210) $ (45,853) Denominator: Weighted-average common shares outstanding used in computing basic net income (loss) 55,974,080 46,929,498 53,165,774 46,766,562 Weighted-average common shares outstanding used in computing diluted net income (loss) 58,313,002 46,929,498 53,165,774 46,766,562 Basic net income (loss) per common share $ 0.06 $ (0.48) $ (0.98) $ (0.98) Diluted net income (loss) per common share $ 0.05 $ (0.48) $ (0.98) $ (0.98)
Schedule of potentially dilutive securities	Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 (in thousands) (in thousands) Options to purchase common stock 2,339 — — —

Marketable Securities (Tables)

Marketable Securities (Tables)	9 Months Ended
	Sep. 30, 2018
Marketable Securities
Schedule of marketable securities	Gross Gross Amortized Unrealized Unrealized September 30, 2018 Cost Gains Losses Fair Value (in thousands) Money Market Funds $ 15,632 $ — $ — $ 15,632 Corporate Securities 98,498 1 (471) 98,028 Government Securities 416,664 — (1,859) 414,805 $ 530,794 $ 1 $ (2,330) $ 528,465 Reported as Cash and cash equivalents $ 15,632 Marketable securities 512,833 Total investments $ 528,465 Gross Gross Amortized Unrealized Unrealized December 31, 2017 Cost Gains Losses Fair Value (in thousands) Money Market Funds $ 5,175 $ — $ — $ 5,175 Corporate Securities 123,860 — (590) 123,270 Government Securities 224,739 — (1,209) 223,530 $ 353,774 $ — $ (1,799) $ 351,975 Reported as Cash and cash equivalents $ 5,175 Marketable securities 346,800 Total investments $ 351,975
Schedule of maturities of marketable securities	Amortized Estimated September 30, 2018 Cost Fair Value (in thousands) Mature in one year or less $ 237,736 $ 236,605 Mature within two years 277,426 276,228 $ 515,162 $ 512,833
Schedule of unrealized losses on available-for-sale investments	The unrealized losses on available-for-sale investments and their related fair values as of September 30, 2018 and December 31, 2017 are as follows: Less than 12 months 12 months or greater September 30, 2018 Fair value Unrealized losses Fair value Unrealized losses (in thousands) Corporate Securities $ 69,494 $ (411) $ 28,534 $ (60) Government Securities 167,111 (720) 247,694 (1,139) $ 236,605 $ (1,131) $ 276,228 $ (1,199) Less than 12 months 12 months or greater December 31, 2017 Fair value Unrealized losses Fair value Unrealized losses (in thousands) Corporate Securities $ 79,290 $ (137) $ 43,980 $ (453) Government Securities 128,313 (461) 95,217 (748) $ 207,603 $ (598) $ 139,197 $ (1,201)

Stock-Based Compensation (Table

Stock-Based Compensation (Tables)	9 Months Ended
	Sep. 30, 2018
Stock-Based Compensation
Schedule of total employee, director and non-employee stock-based compensation expense recognized	Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 General and administrative $ 2,732 $ 1,422 $ 6,037 $ 4,305 Research and development 3,388 2,183 9,436 5,906 $ 6,120 $ 3,605 $ 15,473 $ 10,211 Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Stock options $ 5,832 $ 3,462 $ 14,723 $ 9,820 ESPP 209 143 562 391 Restricted stock units 79 — 188 — $ 6,120 $ 3,605 $ 15,473 $ 10,211
Summary of stock option activity	Weighted Weighted Average Average Number of Exercise Remaining Aggregate Shares subject Price Contractual Intrinsic to outstanding (Per Term Value options Share) (in years) (in thousands) Balances at December 31, 2017 5,093,442 $ 15.32 7.62 Options granted 1,679,400 $ 26.63 Options forfeited (107,720) $ 21.66 Options exercised (788,409) $ 8.96 Balance at September 30, 2018 5,876,713 $ 19.29 7.70 $ 115,992 Exercisable 2,857,873 $ 14.76 6.56 $ 69,180
Schedule of weighted average assumptions used for estimation of fair value of stock options	Options Options Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Expected term (years) 6.1 6.1 6.1 6.1 Expected volatility 72.8 % 96.7 % 73.1 % 89.8 % Risk-free interest rate 2.87 % 1.95 % 2.56 % 2.03 % Expected dividend yield — % — % — % — %
Schedule of weighted average assumptions used for estimation of fair value of ESPP	ESPP ESPP Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Expected term (years) 0.5 - 2.0 0.5 - 2.0 0.5 - 2.0 0.5 - 2.0 Expected volatility 61.2 - 71.4 % 67.8 - 79.8 % 61.2 - 71.4 % 67.8 - 79.8 % Risk-free interest rate 1.47 - 2.41 % .47 - 1.09 % 1.47 - 2.41 % .47 - 1.09 % Expected dividend yield — % — % — % — %
Summary of restricted stock unity activity	Weighted Restricted Average Grant Stock Date Fair Value Units (Per unit) Unvested at December 31, 2017 — $ — Granted 33,933 $ 27.64 Vested — $ — Forfeited — $ — Unvested at September 30, 2018 33,933 $ 27.64

Commitments and Contingencies (

Commitments and Contingencies (Tables)	9 Months Ended
	Sep. 30, 2018
Commitments and Contingencies
Schedule of future minimum payments for non-cancellable operating leases	Years ending December 31, For the remainder of the fiscal year $ 471 2019 2,752 2020 2,404 2021 1,980 2022 1,406

Prior-Period Financial Statem_2

Prior-Period Financial Statements (Tables)	9 Months Ended
	Sep. 30, 2018
ASU 2014-09
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Summary of effect of adopting new accounting pronouncement	The following tables summarize the effects of adopting ASC topic 606 on our financial statements. As Reported Effect of Adoption of As Revised 2017 ASC 606 2017 Assets Current assets Cash and cash equivalents $ 16,528 $ — $ 16,528 Marketable securities 207,603 — 207,603 Accounts receivable 1,142 — 1,142 Prepaid expenses and other current assets 5,606 — 5,606 Total current assets 230,879 — 230,879 Property and equipment, net 7,088 — 7,088 Patents, licenses, and other intangible assets, net 11,148 — 11,148 Marketable securities - long term 139,198 — 139,198 Income tax receivable 1,524 — 1,524 Loan receivable — 86 86 Interest receivable — 14 14 Other assets 265 — 265 Total assets $ 390,102 $ 100 $ 390,202 Liabilities and stockholders’ equity Current liabilities Accounts payable $ 6,869 $ — $ 6,869 Accrued expenses 5,480 — 5,480 Current portion of deferred rent 26 — 26 Current portion of deferred revenue 88,813 (28,695) 60,118 Income taxes 157 — 157 Total current liabilities 101,345 (28,695) 72,650 Deferred rent, less current portion 1,088 — 1,088 Deferred revenue, less current portion 5,623 (5,623) — Total liabilities 108,056 (34,318) 73,738 Commitments and contingencies Stockholders’ equity Preferred stock, $0.01 par value: 10,000,000 authorized shares; -0- issued and outstanding shares at December 31, 2017 — — — Common stock, $0.01 par value: 200,000,000 authorized shares at December 31, 2017; 47,002,488 issued and outstanding at December 31, 2017 470 — 470 Additional paid-in capital 570,670 — 570,670 Accumulated other comprehensive income loss (1,808) — (1,808) Accumulated deficit (287,286) 34,418 (252,868) Stockholders’ equity 282,046 34,418 316,464 Total liabilities and stockholders’ equity $ 390,102 $ 100 $ 390,202 As Reported As Revised Three Months Ended Effect of Three Months Ended September 30, Adoption of September 30, 2017 ASC 606 2017 Revenue Collaborations, licenses and milestones $ 7,090 $ (7,090) $ — Operating expenses Research and development 19,408 — 19,408 General and administrative 4,172 — 4,172 Total operating expenses 23,580 — 23,580 Loss from operations (16,490) (7,090) (23,580) Other income (expenses) Interest income 1,048 — 1,048 Interest expense (3) — (3) Other income 56 — 56 Total other income, net 1,101 — 1,101 Loss before income tax expense (15,389) (7,090) (22,479) Income tax expense 173 — 173 Net loss (15,562) (7,090) (22,652) Other comprehensive income (loss) Net unrealized loss on marketable securities 143 — 143 Comprehensive loss $ (15,419) $ (7,090) $ (22,509) Basic and diluted net loss per common share $ (0.33) $ (0.15) $ (0.48) As Reported As Revised Nine Months Ended Effect of Nine Months Ended September 30, Adoption of September 30, 2017 ASC 606 2017 Revenue Collaborations, licenses and milestones $ 24,771 $ (8,771) $ 16,000 Operating expenses Research and development 51,376 — 51,376 General and administrative 13,074 — 13,074 Total operating expenses 64,450 — 64,450 Loss from operations (39,679) (8,771) (48,450) Other income (expenses) Interest income 3,142 — 3,142 Interest expense (8) — (8) Other income 86 — 86 Total other income, net 3,220 — 3,220 Loss before income tax expense (36,459) (8,771) (45,230) Income tax expense 623 — 623 Net loss (37,082) (8,771) (45,853) Other comprehensive income (loss) Net unrealized gain on marketable securities 344 — 344 Comprehensive loss $ (36,738) $ (8,771) $ (45,509) Basic and diluted net loss per common share $ (0.79) $ (0.19) $ (0.98) Accumulated Additional Other Total Common Stock Paid Comprehensive Accumulated Stockholders’ Stockholders’ Equity Shares Amount in-Capital Loss Deficit Equity Balance, December 31, 2016 as originally reported 46,567,978 $ 466 $ 552,889 $ (1,441) $ (237,960) $ 313,954 Adoption of ASU 2016-09 — — 401 — (401) — Adoption of ASC 606 — — — — 23,979 23,979 Balance, December 31, 2016 as revised 46,567,978 466 553,290 (1,441) (214,382) 337,933 Issuance of common stock upon exercise of stock awards 363,603 4 2,793 — — 2,797 Issuance of common stock under the Employee Stock Purchase Plan 70,907 — 936 — — 936 Comprehensive loss — — — (367) (48,925) (49,292) Stock-based compensation — — 13,651 — — 13,651 Balance, December 31, 2017 47,002,488 $ 470 $ 570,670 $ (1,808) $ (263,307) $ 306,025 Adoption of ASC topic 606 — — — — 10,439 10,439 Balance, December 31, 2017 as revised 47,002,488 $ 470 $ 570,670 $ (1,808) $ (252,868) $ 316,464 As Reported As Revised Nine Months Ended Effect of Nine Months Ended September 30, Adoption of September 30, 2017 ASC 606 2017 Cash flows from operating activities Net loss $ (37,082) $ (8,771) $ (45,853) Adjustments to reconcile net loss to net cash (used in) provided by operating activities: Depreciation and amortization 1,420 — 1,420 Amortization of premium on marketable securities 2,148 — 2,148 Stock-based compensation 10,211 — 10,211 Abandonment of capitalized intangible assets 273 — 273 Gain on disposal of assets (2) — (2) Gain on sale of marketable securities available for sale — — — Changes in operating assets and liabilities: Accounts receivable 7,785 — 7,785 Interest receivable (588) (14) (602) Prepaid expenses and other assets (3,971) — (3,971) Accounts payable 2,722 — 2,722 Accrued expenses (2,056) — (2,056) Income taxes (65) — (65) Deferred rent 359 — 359 Deferred revenue (8,171) 8,871 700 Net cash used in operating activities (27,017) 86 (26,931) Cash flows from investing activities Purchase of marketable securities (49,203) — (49,203) Purchase of intangible assets (1,520) — (1,520) Purchase of property and equipment (3,834) — (3,834) Proceeds from sale of property and equipment 2 — 2 Proceeds from sale and maturities of marketable securities 77,566 — 77,566 Issuance of loan — (86) (86) Net cash provided by investing activities 23,011 (86) 22,925 Cash flows from financing activities Proceeds from issuance of common stock upon exercise of stock awards 2,669 — 2,669 Proceeds from issuance of common stock under the Employee Stock Purchase Plan 443 — 443 Net cash provided by financing activities 3,112 — 3,112 Net increase in cash and cash equivalents (894) — (894) Cash and cash equivalents , beginning of period 14,528 — 14,528 Cash and cash equivalents , end of period $ 13,634 $ — $ 13,634

Summary of Significant Accoun_3

Summary of Significant Accounting Policies - Intangibles (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Summary of Significant Accounting Policies
Intangible assets impaired	$ 0	$ 0	$ 0	$ 0
Abandonment of capitalized intangible assets			$ 118,000	$ 273,000

Fair Value of Financial Instr_3

Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017	Sep. 30, 2017
Fair Value of Financial Instruments
Money Market Funds	$ 34,996	$ 16,528
Securities	512,833
Total Fair Value	528,465	351,975
Transfers from level 1 to level 2	0		$ 0
Transfers from level 2 to level 1	0		$ 0
Money Market Funds
Fair Value of Financial Instruments
Money Market Funds	15,632	5,175
Corporate Securities
Fair Value of Financial Instruments
Securities	98,028	123,270
Government Securities
Fair Value of Financial Instruments
Securities	414,805	223,530
Level 1
Fair Value of Financial Instruments
Total Fair Value	15,632	5,175
Level 1 | Money Market Funds
Fair Value of Financial Instruments
Money Market Funds	15,632	5,175
Level 2
Fair Value of Financial Instruments
Total Fair Value	512,833	346,800
Level 2 | Corporate Securities
Fair Value of Financial Instruments
Securities	98,028	123,270
Level 2 | Government Securities
Fair Value of Financial Instruments
Securities	$ 414,805	$ 223,530

Net Income (Loss) Per Share (De

Net Income (Loss) Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Numerator:
Net income (loss) attributable to common stockholders	$ 3,150	$ (22,652)	$ (52,210)	$ (45,853)
Denominator:
Weighted average common shares outstanding, basic	55,974,080	46,929,498	53,165,774	46,766,562
Weighted average common shares outstanding, diluted	58,313,002	46,929,498	53,165,774	46,766,562
Net income (loss) per common share, basic (in dollars per share)	$ 0.06	$ (0.48)	$ (0.98)	$ (0.98)
Net income (loss) per common share, diluted (in dollars per share)	$ 0.05	$ (0.48)	$ (0.98)	$ (0.98)

Net Income (Loss) Per Share - A

Net Income (Loss) Per Share - Anti-dilutive securities (Details) shares in Thousands	3 Months Ended
	Sep. 30, 2018shares
Common Stock | Employee stock options
Net Income (Loss) Per Share
Anti-dilutive securities (in shares)	2,339

Marketable Securities (Details)

Marketable Securities (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Schedule of Available-for-sale Securities
Cash and cash equivalents	$ 34,996	$ 16,528
Investments, amortized cost	530,794	353,774
Investments	528,465	351,975
Total amortized cost	515,162
Gross unrealized gains	1
Gross unrealized losses	(2,330)	(1,799)
Securities	512,833
Marketable securities
Schedule of Available-for-sale Securities
Securities	512,833	346,800
Money Market Funds
Schedule of Available-for-sale Securities
Cash and cash equivalents	15,632	5,175
Corporate Securities
Schedule of Available-for-sale Securities
Total amortized cost	98,498	123,860
Gross unrealized gains	1
Gross unrealized losses	(471)	(590)
Securities	98,028	123,270
Government Securities
Schedule of Available-for-sale Securities
Total amortized cost	416,664	224,739
Gross unrealized losses	(1,859)	(1,209)
Securities	414,805	223,530
Cash and Cash Equivalents
Schedule of Available-for-sale Securities
Cash and cash equivalents	$ 15,632	$ 5,175

Marketable Securities - Maturit

Marketable Securities - Maturities (Details) $ in Thousands	Sep. 30, 2018USD ($)
Amortized Cost
Maturing in one year or less	$ 237,736
Maturing after one year	277,426
Total amortized cost	515,162
Estimate Fair Value
Maturing in one year or less	236,605
Maturing after one year	276,228
Total estimated fair value	$ 512,833

Marketable Securities - Unreali

Marketable Securities - Unrealized losses (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Fair value
Fair value, less than 12 months	$ 236,605	$ 207,603
Fair value, 12 months or greater	276,228	139,197
Unrealized losses
Unrealized losses, Less than 12 months	(1,131)	(598)
Unrealized losses, 12 months or greater	(1,199)	(1,201)
Corporate Securities
Fair value
Fair value, less than 12 months	69,494	79,290
Fair value, 12 months or greater	28,534	43,980
Unrealized losses
Unrealized losses, Less than 12 months	(411)	(137)
Unrealized losses, 12 months or greater	(60)	(453)
Government Securities
Fair value
Fair value, less than 12 months	167,111	128,313
Fair value, 12 months or greater	247,694	95,217
Unrealized losses
Unrealized losses, Less than 12 months	(720)	(461)
Unrealized losses, 12 months or greater	$ (1,139)	$ (748)

Sale of Additional Common Sto_2

Sale of Additional Common Stock (Details) - Common Stock - USD ($) $ in Millions	1 Months Ended	9 Months Ended
	Mar. 31, 2018	Sep. 30, 2018
Sale of common stock	8,395,000	8,395,000
Net proceeds	$ 245.5

Stock Based Compensation (Detai

Stock Based Compensation (Details)	Dec. 02, 2013shares	Sep. 30, 2018itemshares	Sep. 30, 2017shares	Dec. 31, 2017shares
Stock-based compensation
Common stock, shares issued		56,212,449		47,002,488
Employee stock options
Stock-based compensation
Options granted (in shares)		1,679,400	1,438,100
ESPP
Stock-based compensation
Total number of shares of common stock available for issuance		581,286
Awards issued under the plan (in shares)		318,945
Increase in shares of common stock available for issuance (in shares)		0
ESPP | Maximum
Stock-based compensation
Annual percentage increase in shares of common stock available for issuance		1.00%
Annual increase in shares of common stock available for issuance (in shares)		621,814
Restricted stock units
Stock-based compensation
Annual installment vesting periods | item		3
The 2013 Plan
Stock-based compensation
Total number of shares of common stock available for issuance		9,618,155
Annual percentage increase in shares of common stock available for issuance		4.00%
Awards issued under the plan (in shares)		6,624,750
Increase in shares of common stock available for issuance (in shares)		1,880,100
The 2010 Plan
Stock-based compensation
Total number of shares of common stock available for issuance		2,684,456
Options granted (in shares)	0

Stock-Based Compensation - Empl

Stock-Based Compensation - Employee expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Stock-based compensation
Total employee, director and non-employee stock-based compensation expense	$ 6,120	$ 3,605	$ 15,473	$ 10,211
Employee stock options
Stock-based compensation
Total employee, director and non-employee stock-based compensation expense	5,832	3,462	14,723	9,820
ESPP
Stock-based compensation
Total employee, director and non-employee stock-based compensation expense	209	143	562	391
Restricted stock units
Stock-based compensation
Total employee, director and non-employee stock-based compensation expense	79		188
General and administrative
Stock-based compensation
Total employee, director and non-employee stock-based compensation expense	2,732	1,422	6,037	4,305
Research and development
Stock-based compensation
Total employee, director and non-employee stock-based compensation expense	$ 3,388	$ 2,183	$ 9,436	$ 5,906

Stock-Based Compensation - Opti

Stock-Based Compensation - Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands	Dec. 02, 2013	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Employee stock options
Number of Shares subject to outstanding options
Balance at the beginning of the period (in shares)		5,093,442
Options granted (in shares)		1,679,400	1,438,100
Options forfeited (in shares)		(107,720)
Options exercised (in shares)		(788,409)
Balance at the end of the period (in shares)		5,876,713		5,093,442
Exercisable options (in shares)		2,857,873
Weighted Average Exercise Price (Per Share)
Balance at the beginning of the period (in dollars per share)		$ 15.32
Options granted (in dollars per share)		26.63
Options forfeited (in dollars per share)		21.66
Options exercised (in dollars per share)		8.96
Balance at the end of the period (in dollars per share)		19.29		$ 15.32
Exercisable (in dollars per share)		$ 14.76
Weighted-average remaining contractual life		7 years 8 months 12 days		7 years 7 months 13 days
Weighted-average remaining contractual life of awards exercisable		6 years 6 months 22 days
Aggregate intrinsic value of options outstanding		$ 115,992
Aggregate intrinsic value of options exercisable		$ 69,180
Closing price of common stock (in dollars per share)		$ 38.97
Weighted average fair value of options granted (in dollars per share)		$ 17.57	$ 16.91
The 2010 Plan
Number of Shares subject to outstanding options
Options granted (in shares)	0

Stock-Based Compensation - FV o

Stock-Based Compensation - FV of employee stock options (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Employee stock options
Weighted average assumptions for estimated fair value of employee stock options
Expected volatility (as a percent)	72.80%	96.70%	73.10%	89.80%
Risk-free interest rate (as a percent)	2.87%	1.95%	2.56%	2.03%
Expected term (years)	6 years 1 month 6 days	6 years 1 month 6 days	6 years 1 month 6 days	6 years 1 month 6 days
Compensation expense
Unamortized compensation expense related to unvested options	$ 44.5		$ 44.5
Period to recognize unamortized compensation expense			2 years 9 months 18 days
ESPP
Weighted average assumptions for estimated fair value of employee stock options
Expected volatility, low end of range (as a percent)	61.20%	67.80%	61.20%	67.80%
Expected volatility, high end of range (as a percent)	71.40%	79.80%	71.40%	79.80%
Risk-free interest rate, low end of range (as a percent)	1.47%	0.47%	1.47%	0.47%
Risk-free interest rate, high end of range (as a percent)	2.41%	1.09%	2.41%	1.09%
Compensation expense
Unamortized compensation expense related to unvested options	$ 1		$ 1
Period to recognize unamortized compensation expense			1 year 2 months 12 days
ESPP | Minimum
Weighted average assumptions for estimated fair value of employee stock options
Expected term (years)	6 months	6 months	6 months	6 months
ESPP | Maximum
Weighted average assumptions for estimated fair value of employee stock options
Expected term (years)	2 years	2 years	2 years	2 years

Stock Based Compensation - Rest

Stock Based Compensation - Restricted Stock Units (Details) - Restricted stock units $ / shares in Units, $ in Thousands	9 Months Ended
	Sep. 30, 2018USD ($)$ / sharesshares
Stock-based compensation
Granted | shares	33,933
Ending balance | shares	33,933
Weighted Average Grant Date Fair Value, Granted | $ / shares	$ 27.64
Weighted Average Grant Date Fair Value, Ending Balance | $ / shares	$ 27.64
Compensation expense
Unamortized compensation expense related to unvested restricted stock units | $	$ 750
Period to recognize unamortized compensation expense	2 years 4 months 24 days

Commitments and Contingencies_2

Commitments and Contingencies (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Jul. 31, 2017	Jun. 30, 2017
Operating Leases
For the remainder of the fiscal year	$ 471
2,019	2,752
2,020	2,404
2,021	1,980
2,022	1,406
Net rent expense	$ 1,900	$ 1,100
Monrovia
Lease term			64 months
Renewal term			5 years
San Diego
Lease term				61 months
Renewal term				5 years

Collaboration and Licensing A_2

Collaboration and Licensing Agreements (Details)

1 Months Ended

3 Months Ended

9 Months Ended

12 Months Ended

Jul. 31, 2016USD ($)

Jun. 30, 2016USD ($)productitem

Sep. 30, 2015USD ($)item

Jan. 31, 2013USD ($)item

Feb. 28, 2009item

Sep. 30, 2018USD ($)

Dec. 31, 2017USD ($)

Sep. 30, 2017USD ($)

Sep. 30, 2018USD ($)item

Sep. 30, 2017USD ($)

Dec. 31, 2017USD ($)

Dec. 31, 2016USD ($)

Dec. 31, 2013USD ($)

Option and license agreement | Alexion Pharmaceuticals, Inc.

Collaboration research and licensing agreements

Nonrefundable upfront payment

$ 3,000,000

Revenue recognized

$ 9,000,000

$ 0

$ 9,000,000

$ 0

Number of different target programs | item

6

Research license term

5 years

Annual maintenance fees

$ 2,000,000

Milestone payment received

17,500,000

Deferred revenue

0

0

2009 Research License and Commercialization Agreement | CSL Limited

Collaboration research and licensing agreements

Revenue recognized

0

0

0

3,500,000

$ 3,500,000

Deferred revenue

0

0

Number of commercial licenses | item

1

Collaboration And License Agreement | Novartis

Collaboration research and licensing agreements

Nonrefundable upfront payment

$ 150,000,000

Revenue recognized

20,040,000

0

20,040,000

0

Deferred revenue

40,100,000

40,100,000

Milestones or royalties in transaction price

0

Collaboration And License Agreement | Novartis | Maximum

Collaboration research and licensing agreements

Potential milestone payment

2,400,000,000

$ 2,400,000,000

Collaboration And License Agreement | Novartis | Bispecific FC Technologies

Collaboration research and licensing agreements

Number of development stage products | product

2

Collaboration And License Agreement | Novartis | Bispecific FC Technologies | XmAb14045

Collaboration research and licensing agreements

Allocation of consideration to deliverables

$ 27,100,000

Collaboration And License Agreement | Novartis | Bispecific FC Technologies | XmAb13676

Collaboration research and licensing agreements

Allocation of consideration to deliverables

31,400,000

Collaboration And License Agreement | Novartis | Global Discovery Program

Collaboration research and licensing agreements

Number of bispecific drug candidates | item

4

Allocation of consideration to deliverables

$ 20,050,000

Number of discovery programs | item

4

Right to substitute identified target period

5 years

Collaboration And License Agreement | Novartis | Global Discovery Program | ASU 2014-09

Collaboration research and licensing agreements

Revenue recognized

20,040,000

$ 20,050,000

Collaboration And License Agreement | Novartis | Global Discovery Program | Maximum

Collaboration research and licensing agreements

Number of antibody targets for which bispecific technology applied | item

4

Collaboration And License Agreement | Novartis | FC Licenses

Collaboration research and licensing agreements

Allocation of consideration to deliverables

$ 11,300,000

Collaboration And License Agreement | Novartis | FC Licenses | Maximum

Collaboration research and licensing agreements

Number of targets against which non-exclusive license is provided | item

10

Research and License Agreement 2015 | Amgen, Inc.

Collaboration research and licensing agreements

Nonrefundable upfront payment

$ 45,000,000

Potential milestone payment

$ 1,700,000,000

Revenue recognized

0

$ 10,000,000

$ 0

$ 0

$ 0

Number of different target programs | item

6

Allocation of consideration to deliverables

55,000,000

55,000,000

Deferred revenue

0

0

Milestones or royalties in transaction price

$ 0

Research and License Agreement 2015 | Amgen, Inc. | ASU 2014-09

Collaboration research and licensing agreements

Revenue recognized

$ 31,250,000

Research and License Agreement 2015 | Amgen, Inc. | CD38 Program

Collaboration research and licensing agreements

Allocation of consideration to deliverables

23,750,000

$ 23,750,000

Research and License Agreement 2015 | Amgen, Inc. | Discovery Program

Collaboration research and licensing agreements

Research license term

3 years

Allocation of consideration to deliverables

$ 6,250,000

$ 6,250,000

Number of discovery programs | item

5

Additional research term

1 year

Previous targets which bispecific technology will be applied | item

5

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2017	Sep. 30, 2017	Sep. 30, 2018
Reconciliation of federal statutory income tax to effective income tax
Income tax expense	$ 173	$ 623
Federal
Reconciliation of federal statutory income tax to effective income tax
Income tax receivable			$ 1,500

Prior-Period Financial Statem_3

Prior-Period Financial Statementss - (Details) - USD ($) $ in Thousands	3 Months Ended			9 Months Ended		12 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Jun. 30, 2016	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017	Dec. 31, 2016
Revenue
Collaborations, licenses and milestones	$ 29,039			$ 29,039	$ 16,000
ASU 2014-09 | As Reported Before ASC Topic 606
Revenue
Collaborations, licenses and milestones		$ 7,090			24,771
ASU 2014-09 | Effect of Adoption of ASC Topic 606
Revenue
Collaborations, licenses and milestones		$ (7,090)			$ (8,771)
ASU 2014-09 | Collaboration
Revenue
Collaborations, licenses and milestones						$ 20,500	$ 6,250
ASU 2014-09 | License
Revenue
Prior revenue recognition period				5 years
Collaborations, licenses and milestones			$ 11,300

Prior-Period Financial Statem_4

Prior-Period Financial Statements - Balance Sheet (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017	Dec. 31, 2016
Current assets
Cash and cash equivalents	$ 34,996	$ 16,528
Marketable securities	236,605	207,603
Accounts receivable	2,462	1,142
Prepaid expenses and other current assets	12,095	5,606
Total current assets	286,920	230,879
Property and equipment, net	9,688	7,088
Patents, licenses, and other intangible assets, net	11,677	11,148
Marketable securities - long term	276,228	139,198
Income tax receivable	762	1,524
Loan receivable		86
Interest receivable		14
Other assets	311	265
Total assets	585,586	390,202
Current liabilities
Accounts payable	5,983	6,869
Accrued expenses	5,671	5,480
Current portion of deferred rent	294	26
Current portion of deferred revenue	40,079	60,118
Income taxes		157
Total current liabilities	52,027	72,650
Deferred rent, less current portion	1,286	1,088
Total liabilities	53,313	73,738
Commitments and contingencies
Preferred stock, $0.01 par value: 10,000,000 authorized shares; -0- issued and outstanding shares at December 31, 2017
Common stock, $0.01 par value: 200,000,000 authorized shares at December 31, 2017; 47,002,488 issued and outstanding at December 31, 2017	562	470
Additional paid-in capital	839,127	570,670
Accumulated other comprehensive loss	(2,338)	(1,808)
Accumulated deficit	(305,078)	(252,868)
Stockholders' equity	532,273	316,464
Total liabilities and stockholders' equity	$ 585,586	390,202
As Reported Before ASC Topic 606
Current liabilities
Stockholders' equity		306,025	$ 337,933
ASU 2014-09 | As Reported Before ASC Topic 606
Current assets
Cash and cash equivalents		16,528
Marketable securities		207,603
Accounts receivable		1,142
Prepaid expenses and other current assets		5,606
Total current assets		230,879
Property and equipment, net		7,088
Patents, licenses, and other intangible assets, net		11,148
Marketable securities - long term		139,198
Income tax receivable		1,524
Other assets		265
Total assets		390,102
Current liabilities
Accounts payable		6,869
Accrued expenses		5,480
Current portion of deferred rent		26
Current portion of deferred revenue		88,813
Income taxes		157
Total current liabilities		101,345
Deferred rent, less current portion		1,088
Deferred revenue, less current portion		5,623
Total liabilities		108,056
Common stock, $0.01 par value: 200,000,000 authorized shares at December 31, 2017; 47,002,488 issued and outstanding at December 31, 2017		470
Additional paid-in capital		570,670
Accumulated other comprehensive loss		(1,808)
Accumulated deficit		(287,286)
Stockholders' equity		282,046
Total liabilities and stockholders' equity		390,102
ASU 2014-09 | Effect of Adoption of ASC Topic 606
Current assets
Loan receivable		86
Interest receivable		14
Total assets		100
Current liabilities
Current portion of deferred revenue		(28,695)
Total current liabilities		(28,695)
Deferred revenue, less current portion		(5,623)
Total liabilities		(34,318)
Accumulated deficit		34,418
Stockholders' equity		34,418
Total liabilities and stockholders' equity		$ 100

Prior-Period Financial Statem_5

Prior-Period Financial Statements - Balance Sheet Stock Information (Details) - $ / shares	Sep. 30, 2018	Dec. 31, 2017
Condensed Balance Sheets
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	200,000,000	200,000,000
Common stock, shares issued	56,212,449	47,002,488
Common stock, shares outstanding	56,212,449	47,002,488

Prior-Period Financial Statem_6

Prior-Period Financial Statements - Comprehensive Income (Loss) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Revenue
Collaborations, licenses and milestones	$ 29,039		$ 29,039	$ 16,000
Operating expenses
Research and development	20,953	$ 19,408	70,371	51,376
General and administrative	7,435	4,172	16,955	13,074
Total operating expenses	28,388	23,580	87,326	64,450
Income (loss) from operations	651	(23,580)	(58,287)	(48,450)
Other income (expenses)
Interest income		1,048		3,142
Interest expense		(3)		(8)
Other income (expense)	(143)	56	(202)	86
Total other income, net	2,499	1,101	6,077	3,220
Net income (loss) before income taxes	3,150	(22,479)	(52,210)	(45,230)
Income tax expense		173		623
Net income (loss)	3,150	(22,652)	(52,210)	(45,853)
Other comprehensive income
Net unrealized gain (loss) on marketable securities	(330)	143	(530)	344
Comprehensive income (loss)	$ 2,820	$ (22,509)	$ (52,740)	$ (45,509)
Basic and diluted net loss (in dollars per share)		$ (0.48)		$ (0.98)
As Reported Before ASC Topic 606
Other comprehensive income
Comprehensive income (loss)					$ (49,292)
ASU 2014-09 | As Reported Before ASC Topic 606
Revenue
Collaborations, licenses and milestones		$ 7,090		$ 24,771
Operating expenses
Research and development		19,408		51,376
General and administrative		4,172		13,074
Total operating expenses		23,580		64,450
Income (loss) from operations		(16,490)		(39,679)
Other income (expenses)
Interest income		1,048		3,142
Interest expense		(3)		(8)
Other income (expense)		56		86
Total other income, net		1,101		3,220
Net income (loss) before income taxes		(15,389)		(36,459)
Income tax expense		173		623
Net income (loss)		(15,562)		(37,082)
Other comprehensive income
Net unrealized gain (loss) on marketable securities		143		344
Comprehensive income (loss)		$ (15,419)		$ (36,738)
Basic and diluted net loss (in dollars per share)		$ (0.33)		$ (0.79)
ASU 2014-09 | Effect of Adoption of ASC Topic 606
Revenue
Collaborations, licenses and milestones		$ (7,090)		$ (8,771)
Operating expenses
Income (loss) from operations		(7,090)		(8,771)
Other income (expenses)
Net income (loss) before income taxes		(7,090)		(8,771)
Net income (loss)		(7,090)		(8,771)
Other comprehensive income
Comprehensive income (loss)		$ (7,090)		$ (8,771)
Basic and diluted net loss (in dollars per share)		$ (0.15)		$ (0.19)

Prior-Period Financial Statem_7

Prior-Period Financial Statements - Stockholders' Equity (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended		9 Months Ended		12 Months Ended
	Mar. 31, 2018	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017	Dec. 31, 2016
Increase (Decrease) in Stockholders' Equity
Balance				$ 316,464
Balance, revised						$ 316,464
Sale of common stock, net of issuance cost				245,504
Issuance of common stock upon exercise of stock awards				7,068
Issuance of common stock under the Employee Stock Purchase Plan				504
Comprehensive income (loss)		$ 2,820	$ (22,509)	(52,740)	$ (45,509)
Stock-based compensation expense				15,473
Balance		532,273		532,273		316,464
As Reported Before ASC Topic 606
Increase (Decrease) in Stockholders' Equity
Balance				306,025	337,933	337,933
Issuance of common stock upon exercise of stock awards						2,797
Issuance of common stock under the Employee Stock Purchase Plan						936
Comprehensive income (loss)						(49,292)
Stock-based compensation expense						13,651
Balance						306,025
Effect of Adoption of ASC Topic 606
Increase (Decrease) in Stockholders' Equity
Adoption of new accounting principle						10,439
ASU 2014-09
Increase (Decrease) in Stockholders' Equity
Adoption of new accounting principle						34,418
ASU 2014-09 | As Reported Before ASC Topic 606
Increase (Decrease) in Stockholders' Equity
Balance				282,046
Adoption of new accounting principle							$ 23,979
Comprehensive income (loss)			(15,419)		(36,738)
Balance						282,046
ASU 2014-09 | Effect of Adoption of ASC Topic 606
Increase (Decrease) in Stockholders' Equity
Balance				34,418
Comprehensive income (loss)			$ (7,090)		(8,771)
Balance						34,418
Common Stock
Increase (Decrease) in Stockholders' Equity
Balance				$ 470
Balance (in shares)				47,002,488
Balance, revised						470
Sale of common stock, net of issuance cost				$ 84
Sale of common stock, net of issuance cost (in shares)	8,395,000			8,395,000
Issuance of common stock upon exercise of stock awards				$ 8
Issuance of common stock upon exercise of stock awards (in shares)				788,409
Issuance of common stock under the Employee Stock Purchase Plan (in shares)				26,552
Balance		$ 562		$ 562		$ 470
Balance (in shares)		56,212,449		56,212,449		47,002,488
Common Stock | As Reported Before ASC Topic 606
Increase (Decrease) in Stockholders' Equity
Balance				$ 470	$ 466	$ 466
Balance (in shares)				47,002,488	46,567,978	46,567,978
Issuance of common stock upon exercise of stock awards						$ 4
Issuance of common stock upon exercise of stock awards (in shares)						363,603
Issuance of common stock under the Employee Stock Purchase Plan (in shares)						70,907
Balance						$ 470
Balance (in shares)						47,002,488
Additional Paid-in Capital
Increase (Decrease) in Stockholders' Equity
Balance				$ 570,670
Balance, revised						$ 570,670
Sale of common stock, net of issuance cost				245,420
Issuance of common stock upon exercise of stock awards				7,060
Issuance of common stock under the Employee Stock Purchase Plan				504
Stock-based compensation expense				15,473
Balance		$ 839,127		839,127		570,670
Additional Paid-in Capital | As Reported Before ASC Topic 606
Increase (Decrease) in Stockholders' Equity
Balance				570,670	$ 553,290	553,290
Issuance of common stock upon exercise of stock awards						2,793
Issuance of common stock under the Employee Stock Purchase Plan						936
Stock-based compensation expense						13,651
Balance						570,670
Additional Paid-in Capital | ASU 2016-09 | As Reported Before ASC Topic 606
Increase (Decrease) in Stockholders' Equity
Adoption of new accounting principle							401
Accumulated Other Comprehensive Loss
Increase (Decrease) in Stockholders' Equity
Balance				(1,808)
Balance, revised						(1,808)
Comprehensive income (loss)				(530)
Balance		(2,338)		(2,338)		(1,808)
Accumulated Other Comprehensive Loss | As Reported Before ASC Topic 606
Increase (Decrease) in Stockholders' Equity
Balance				(1,808)	(1,441)	(1,441)
Comprehensive income (loss)						(367)
Balance						(1,808)
Accumulated Deficit
Increase (Decrease) in Stockholders' Equity
Balance				(252,868)
Balance, revised						(252,868)
Comprehensive income (loss)				(52,210)
Balance		$ (305,078)		(305,078)		(252,868)
Accumulated Deficit | As Reported Before ASC Topic 606
Increase (Decrease) in Stockholders' Equity
Balance				(263,307)	(214,382)	(214,382)
Comprehensive income (loss)						(48,925)
Balance						(263,307)
Accumulated Deficit | Effect of Adoption of ASC Topic 606
Increase (Decrease) in Stockholders' Equity
Adoption of new accounting principle						10,439
Accumulated Deficit | ASU 2016-09 | As Reported Before ASC Topic 606
Increase (Decrease) in Stockholders' Equity
Adoption of new accounting principle							(401)
Accumulated Deficit | ASU 2014-09
Increase (Decrease) in Stockholders' Equity
Adoption of new accounting principle						34,418
Accumulated Deficit | ASU 2014-09 | As Reported Before ASC Topic 606
Increase (Decrease) in Stockholders' Equity
Adoption of new accounting principle							$ 23,979
Scenario, Previously Reported
Increase (Decrease) in Stockholders' Equity
Balance				282,046
Balance						282,046
Scenario, Previously Reported | As Reported Before ASC Topic 606
Increase (Decrease) in Stockholders' Equity
Balance					313,954	313,954
Scenario, Previously Reported | Common Stock
Increase (Decrease) in Stockholders' Equity
Balance				$ 470
Balance (in shares)				47,002,488
Balance						$ 470
Balance (in shares)						47,002,488
Scenario, Previously Reported | Common Stock | As Reported Before ASC Topic 606
Increase (Decrease) in Stockholders' Equity
Balance					$ 466	$ 466
Balance (in shares)					46,567,978	46,567,978
Scenario, Previously Reported | Additional Paid-in Capital
Increase (Decrease) in Stockholders' Equity
Balance				$ 570,670
Balance						$ 570,670
Scenario, Previously Reported | Additional Paid-in Capital | As Reported Before ASC Topic 606
Increase (Decrease) in Stockholders' Equity
Balance					$ 552,889	552,889
Scenario, Previously Reported | Accumulated Other Comprehensive Loss
Increase (Decrease) in Stockholders' Equity
Balance				(1,808)
Balance						(1,808)
Scenario, Previously Reported | Accumulated Other Comprehensive Loss | As Reported Before ASC Topic 606
Increase (Decrease) in Stockholders' Equity
Balance					(1,441)	(1,441)
Scenario, Previously Reported | Accumulated Deficit
Increase (Decrease) in Stockholders' Equity
Balance				$ (287,286)
Balance						(287,286)
Scenario, Previously Reported | Accumulated Deficit | As Reported Before ASC Topic 606
Increase (Decrease) in Stockholders' Equity
Balance					$ (237,960)	$ (237,960)

Prior-Period Financial Statem_8

Prior-Period Financial Statements - Cash Flows (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Cash flows from operating activities
Net loss	$ (52,210)	$ (45,853)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation and amortization	2,368	1,420
Amortization of premium on marketable securities	68	2,148
Stock-based compensation	15,473	10,211
Abandonment of capitalized intangible assets	118	273
Loss (gain) on disposal of assets	110	(2)
Changes in operating assets and liabilities:
Accounts receivable	(1,320)	7,785
Interest receivable	(624)	(602)
Prepaid expenses and other assets	(6,535)	(3,971)
Accounts payable	(886)	2,722
Accrued expenses	192	(2,056)
Income taxes	(156)	(65)
Deferred rent	466	359
Deferred revenue	(20,039)	700
Net cash used in operating activities	(62,975)	(26,931)
Cash flows from investing activities
Purchase of marketable securities	(331,126)	(49,203)
Purchase of intangible assets	(1,302)	(1,520)
Purchase of property and equipment		(3,834)
Proceeds from sale of property and equipment		2
Proceeds from maturities of marketable securities	165,134	77,566
Repayment of loan	86	(86)
Net cash provided by (used in) investing activities	(171,633)	22,925
Cash flows from financing activities
Proceeds from issuance of common stock upon exercise of stock awards	7,068	2,669
Proceeds from issuance of common stock under the Employee Stock Purchase Plan	504	443
Proceeds from issuance of common stock	260,245
Common stock issuance costs	(14,741)
Net cash provided by financing activities	253,076	3,112
Net increase (decrease) in cash and cash equivalents	18,468	(894)
Cash and cash equivalents, beginning of period	16,528	14,528
Cash and cash equivalents, end of period	$ 34,996	13,634
ASU 2014-09 | As Reported Before ASC Topic 606
Cash flows from operating activities
Net loss		(37,082)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation and amortization		1,420
Amortization of premium on marketable securities		2,148
Stock-based compensation		10,211
Abandonment of capitalized intangible assets		273
Loss (gain) on disposal of assets		(2)
Changes in operating assets and liabilities:
Accounts receivable		7,785
Interest receivable		(588)
Prepaid expenses and other assets		(3,971)
Accounts payable		2,722
Accrued expenses		(2,056)
Income taxes		(65)
Deferred rent		359
Deferred revenue		(8,171)
Net cash used in operating activities		(27,017)
Cash flows from investing activities
Purchase of marketable securities		(49,203)
Purchase of intangible assets		(1,520)
Purchase of property and equipment		(3,834)
Proceeds from sale of property and equipment		2
Proceeds from maturities of marketable securities		77,566
Net cash provided by (used in) investing activities		23,011
Cash flows from financing activities
Proceeds from issuance of common stock upon exercise of stock awards		2,669
Proceeds from issuance of common stock under the Employee Stock Purchase Plan		443
Net cash provided by financing activities		3,112
Net increase (decrease) in cash and cash equivalents		(894)
Cash and cash equivalents, beginning of period		14,528
Cash and cash equivalents, end of period		13,634
ASU 2014-09 | Effect of Adoption of ASC Topic 606
Cash flows from operating activities
Net loss		(8,771)
Changes in operating assets and liabilities:
Interest receivable		(14)
Deferred revenue		8,871
Net cash used in operating activities		86
Cash flows from investing activities
Repayment of loan		(86)
Net cash provided by (used in) investing activities		$ (86)