Xencor (XNCR) 10-Q 6 Nov 20 2020 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2020	Oct. 30, 2020
Document and Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Sep. 30, 2020
Entity File Number	001-36182
Entity Registrant Name	Xencor Inc
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	20-1622502
Entity Address, Address Line One	111 West Lemon Avenue
Entity Address, City or Town	Monrovia
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	91016
City Area Code	626
Local Phone Number	305-5900
Title of 12(b) Security	Common Stock, par value $0.01 per share
Trading Symbol	XNCR
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		57,455,204
Entity Central Index Key	0001326732
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q3

Balance Sheets

Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Current assets
Cash and cash equivalents	$ 58,094	$ 50,312
Marketable securities	487,688	479,470
Equity securities	5,382
Accounts receivable	9,534	21,574
Income tax receivable		502
Prepaid expenses and other current assets	10,185	6,547
Total current assets	570,883	558,405
Property and equipment, net	19,771	15,805
Patents, licenses, and other intangible assets, net	15,319	14,421
Marketable securities - long term	31,768	71,526
Income tax receivable		402
Other assets	8,608	9,691
Total assets	646,349	670,250
Current liabilities
Accounts payable	13,109	10,189
Accrued expenses	11,381	8,995
Lease liabilities	2,158	2,169
Deferred revenue	43,840	45,205
Total current liabilities	70,488	66,558
Lease liabilities, net of current portion	7,378	8,565
Deferred revenue, net of current portion		1,926
Total liabilities	77,866	77,049
Commitments and contingencies
Stockholders' equity
Preferred stock, $0.01 par value: 10,000,000 authorized shares; -0- issued and outstanding shares at September 30, 2020 and December 31, 2019
Common stock, $0.01 par value: 200,000,000 authorized shares at September 30, 2020 and December 31, 2019; 57,374,937 issued and outstanding at September 30, 2020 and 56,902,301 issued and outstanding at December 31, 2019	573	569
Additional paid-in capital	919,387	887,873
Accumulated other comprehensive income	567	1,161
Accumulated deficit	(352,044)	(296,402)
Total stockholders' equity	568,483	593,201
Total liabilities and stockholders' equity	$ 646,349	$ 670,250

Balance Sheets (Parenthetical)

Balance Sheets (Parenthetical) - $ / shares	Sep. 30, 2020	Dec. 31, 2019
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	57,374,937	56,902,301
Common stock, shares outstanding	57,374,937	56,902,301

Statements of Comprehensive Inc

Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Revenue
Collaborations, licenses, milestones, and royalties	$ 35,366	$ 21,760	$ 80,840	$ 153,184
Operating expenses
Research and development	44,452	29,770	121,853	91,250
General and administrative	7,636	6,266	22,086	17,537
Total operating expenses	52,088	36,036	143,939	108,787
Income (loss) from operations	(16,722)	(14,276)	(63,099)	44,397
Other income (expenses)
Interest income, net	1,423	3,699	6,552	10,201
Other income (expense), net	2,749	3	905	(211)
Total other income, net	4,172	3,702	7,457	9,990
Net income (loss) before income tax expense (benefit)	(12,550)	(10,574)	(55,642)	54,387
Income tax expense (benefit)		(350)		600
Net income (loss)	(12,550)	(10,224)	(55,642)	53,787
Other comprehensive income (loss)
Net unrealized gain (loss) on marketable securities	(916)	(193)	(594)	2,407
Comprehensive income (loss)	$ (13,466)	$ (10,417)	$ (56,236)	$ 56,194
Net income (loss) per share attributable to common stockholders:
Basic net income (loss) (in dollars per share)	$ (0.22)	$ (0.18)	$ (0.97)	$ 0.95
Diluted net income (loss) (in dollars per share)	$ (0.22)	$ (0.18)	$ (0.97)	$ 0.92
Weighted average shares used to compute net income (loss) per share attributable to common stockholders:
Basic (in shares)	57,266,112	56,643,075	57,091,452	56,449,678
Diluted (in shares)	57,266,112	56,643,075	57,091,452	58,365,158

Statement of Stockholders' Equi

Statement of Stockholders' Equity - USD ($) $ in Thousands	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Income (Loss)	Accumulated Deficit	Total
Balance at Dec. 31, 2018	$ 563	$ 845,366	$ (971)	$ (323,277)	$ 521,681
Balance (in shares) at Dec. 31, 2018	56,279,542
Increase (Decrease) in Stockholders' Equity
Issuance of common stock upon exercise of stock awards	$ 1	666			667
Issuance of common stock upon exercise of stock awards (in shares)	58,536
Issuance of restricted stock units (in shares)	11,311
Comprehensive income (loss)			1,316	80,045	81,361
Stock-based compensation expense		5,856			5,856
Balance at Mar. 31, 2019	$ 564	851,888	345	(243,232)	609,565
Balance (in shares) at Mar. 31, 2019	56,349,389
Balance at Dec. 31, 2018	$ 563	845,366	(971)	(323,277)	521,681
Balance (in shares) at Dec. 31, 2018	56,279,542
Increase (Decrease) in Stockholders' Equity
Comprehensive income (loss)					56,194
Balance at Sep. 30, 2019	$ 567	877,724	1,436	(269,490)	610,237
Balance (in shares) at Sep. 30, 2019	56,714,788
Balance at Mar. 31, 2019	$ 564	851,888	345	(243,232)	609,565
Balance (in shares) at Mar. 31, 2019	56,349,389
Increase (Decrease) in Stockholders' Equity
Issuance of common stock upon exercise of stock awards	$ 1	3,238			3,239
Issuance of common stock upon exercise of stock awards (in shares)	143,504
Issuance of common stock under the Employee Stock Purchase Plan		734			734
Issuance of common stock under the Employee Stock Purchase Plan (in shares)	36,505
Comprehensive income (loss)			1,284	(16,034)	(14,750)
Stock-based compensation expense		9,303			9,303
Balance at Jun. 30, 2019	$ 565	865,163	1,629	(259,266)	608,091
Balance (in shares) at Jun. 30, 2019	56,529,398
Increase (Decrease) in Stockholders' Equity
Issuance of common stock upon exercise of stock awards	$ 2	3,047			3,049
Issuance of common stock upon exercise of stock awards (in shares)	185,390
Comprehensive income (loss)			(193)	(10,224)	(10,417)
Stock-based compensation expense		9,514			9,514
Balance at Sep. 30, 2019	$ 567	877,724	1,436	(269,490)	610,237
Balance (in shares) at Sep. 30, 2019	56,714,788
Balance at Dec. 31, 2019	$ 569	887,873	1,161	(296,402)	593,201
Balance (in shares) at Dec. 31, 2019	56,902,301
Increase (Decrease) in Stockholders' Equity
Issuance of common stock upon exercise of stock awards	$ 1	1,470			1,471
Issuance of common stock upon exercise of stock awards (in shares)	79,930
Issuance of restricted stock units (in shares)	19,022
Comprehensive income (loss)			(105)	(8,074)	(8,179)
Stock-based compensation expense		6,512			6,512
Balance at Mar. 31, 2020	$ 570	895,855	1,056	(304,476)	593,005
Balance (in shares) at Mar. 31, 2020	57,001,253
Balance at Dec. 31, 2019	$ 569	887,873	1,161	(296,402)	593,201
Balance (in shares) at Dec. 31, 2019	56,902,301
Increase (Decrease) in Stockholders' Equity
Comprehensive income (loss)					(56,236)
Balance at Sep. 30, 2020	$ 573	919,387	567	(352,044)	568,483
Balance (in shares) at Sep. 30, 2020	57,374,937
Balance at Mar. 31, 2020	$ 570	895,855	1,056	(304,476)	593,005
Balance (in shares) at Mar. 31, 2020	57,001,253
Increase (Decrease) in Stockholders' Equity
Issuance of common stock upon exercise of stock awards	$ 2	3,273			3,275
Issuance of common stock upon exercise of stock awards (in shares)	181,856
Issuance of common stock under the Employee Stock Purchase Plan		725			725
Issuance of common stock under the Employee Stock Purchase Plan (in shares)	28,344
Issuance of restricted stock units (in shares)	2,800
Comprehensive income (loss)			427	(35,018)	(34,591)
Stock-based compensation expense		8,231			8,231
Balance at Jun. 30, 2020	$ 572	908,084	1,483	(339,494)	570,645
Balance (in shares) at Jun. 30, 2020	57,214,253
Increase (Decrease) in Stockholders' Equity
Issuance of common stock upon exercise of stock awards	$ 1	2,985			2,986
Issuance of common stock upon exercise of stock awards (in shares)	130,784
Issuance of restricted stock units (in shares)	29,900
Comprehensive income (loss)			(916)	(12,550)	(13,466)
Stock-based compensation expense		8,318			8,318
Balance at Sep. 30, 2020	$ 573	$ 919,387	$ 567	$ (352,044)	$ 568,483
Balance (in shares) at Sep. 30, 2020	57,374,937

Statements of Cash Flows

Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Cash flows from operating activities
Net income (loss)	$ (55,642)	$ 53,787
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	4,262	3,073
Accretion of discount on marketable securities	(981)	(3,333)
Stock-based compensation	23,061	24,673
Abandonment of capitalized intangible assets	403	115
Equity received in connection with license agreement	(4,589)
Change in fair value of equity security	(794)
Loss on disposal of assets	4	8
Gain on sale of marketable securities available-for-sale	(153)
Changes in operating assets and liabilities:
Accounts receivable	12,040	5,903
Interest receivable	1,135	(3)
Contract asset and deposits	53	(15,000)
Prepaid expenses and other assets	(3,629)	2,843
Accounts payable	2,920	4,508
Accrued expenses	2,386	(1,830)
Income taxes	895	1,204
Lease liabilities and right of use (ROU) assets	(168)	(110)
Deferred revenue	(3,291)	8,113
Net cash provided by (used in) operating activities	(22,088)	83,951
Cash flows from investing activities
Purchase of marketable securities	(477,310)	(352,174)
Purchase of intangible assets	(2,143)	(2,932)
Purchase of property and equipment	(7,390)	(4,443)
Proceeds from maturities and sale of marketable securities	508,256	292,852
Net cash provided by (used in) investing activities	21,413	(66,697)
Cash flows from financing activities
Proceeds from issuance of common stock upon exercise of stock awards	7,732	6,955
Proceeds from issuance of common stock under the Employee Stock Purchase Plan	725	734
Net cash provided by financing activities	8,457	7,689
Net increase in cash and cash equivalents	7,782	24,943
Cash and cash equivalents, beginning of period	50,312	26,246
Cash and cash equivalents, end of period	58,094	51,189
Cash paid during the period for:
Interest	15	11
Income taxes		200
Supplemental disclosures of non-cash investing activities
Net unrealized gain (loss) on marketable securities	$ (594)	$ 2,407

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2020
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, Xencor, we or us) have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information. 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 2019 Annual Report on Form 10-K filed with the Securities and Exchange Commission (SEC) on February 25, 2020. ​ 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 royalties and accrued research and development expenses, stock-based compensation expenses, intangible assets and related amortization, estimated standalone selling price of performance obligations, the likelihood of recognizing variable consideration, and recoverability of deferred tax 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, 2020 and 2019. ​ The Company capitalizes certain in-process intangible assets that are then abandoned when they are no longer pursued or used in current research activities. There was no material abandonment of in-process intangible assets during the three and nine months ended September 30, 2020 and 2019. ​ Marketable and Equity 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 debt securities issued by investment grade institutions. ​ The Company considers its marketable debt securities to be available-for-sale and 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. These assets are carried at fair value and any impairment losses and recoveries related to the underlying issuer’s credit standing are recognized within other income (expense), while non-credit related impairment losses and recoveries are recognized within accumulated other comprehensive income (loss). There were no impairment losses or recoveries recorded for the three and nine months ended September 30, 2020 and 2019. Accrued interest on marketable debt securities is included in marketable securities’ carrying value. Each reporting period, the Company reviews its portfolio of marketable debt securities, using both quantitative and qualitative factors, to determine if each security’s fair value has declined below its amortized cost basis. ​ The Company also has an investment in an equity security that is carried at fair value with changes in fair value recognized within other income (expense). For equity securities with a readily determinable fair value, the Company remeasures these equity investments at each reporting period until such time that the investment is sold or disposed. If the Company sells an investment, any realized gains and losses on the sale of the securities will be recognized within other income (expense) in the Statement of Comprehensive Income (Loss) in the period of sale. ​ Recent Accounting Pronouncements ​ Pronouncements Adopted in 2020 ​ Effective January 1, 2020, the Company adopted ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, as well as ASU No, 2018-19, Codification Improvements to Topic 326, Financial Instruments – Credit Losses. The standard amends guidance on reporting credit losses for assets held at amortized cost basis and also provides an available-for-sale (AFS) debt security impairment model that is a modified version of the other-than-temporary-impairment (OTTI) model. The AFS debt security impairment model no longer allows consideration of the length of time during which the fair value has been less than its amortized cost when determining whether a credit loss exists. The adoption of this standard did not have any impact on the Company’s financial statements. ​ Effective January 1, 2020, the Company adopted 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 adoption of this standard did not have any impact on the Company’s financial statements. ​ Effective January 1, 2020, the Company adopted ASU No. 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction Between Topic 808 and Topic 606, which provides guidance on how to assess whether certain transactions between collaborative arrangement participants should be accounted for within the revenue recognition standard. The adoption of this standard did not have any impact on the Company’s financial statements. ​ Pronouncements Not Yet Effective ​ In December 2019, the Financial Accounting Standards Board (FASB) issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes ​ In January 2020, the FASB issued ASU No. 2020-01, which clarifies that a company should consider observable transactions that require a company to either apply or discontinue the equity method of accounting under Topic 323, Investment – Equity Method and Joint Ventures, for the purposes of applying the measurement alternative in accordance with Topic 321, Investments – Equity Securities ​ There have been no other material changes to the significant accounting policies previously disclosed in the Company’s 2019 Annual Report on Form 10-K. ​

Fair Value of Financial Instrum

Fair Value of Financial Instruments	9 Months Ended
	Sep. 30, 2020
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 ​ Level 1— ​ Level 2— ​ Level 3— ​ 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, 2020 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (unaudited) ​ December 31, 2019 ​ Total ​ ​ ​ ​ Total ​ ​ ​ ​ ​ ​ Fair Value ​ Level 1 ​ Level 2 ​ Fair Value ​ Level 1 ​ Level 2 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Money Market Funds ​ $ 34,512 ​ $ 34,512 ​ $ — ​ $ 32,009 ​ $ 32,009 ​ $ — Corporate Securities ​ ​ 231,762 ​ ​ — ​ ​ 231,762 ​ ​ 281,751 ​ ​ — ​ ​ 281,751 Government Securities ​ ​ 287,694 ​ ​ — ​ ​ 287,694 ​ ​ 269,245 ​ ​ — ​ ​ 269,245 Equity Securities with Readily Determinable Fair Value ​ ​ 5,382 ​ ​ 5,382 ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ $ 559,350 ​ $ 39,894 ​ $ 519,456 ​ $ 583,005 ​ $ 32,009 ​ $ 550,996 ​ 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, 2020 and 2019, 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, 2020
Net Income (Loss) Per Share
Net Income (Loss) Per Share	3. Net Income (Loss) Per Share ​ We compute basic 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, 2013 Employee Stock Purchase Plan (ESPP) and restricted stock units (RSUs). Potentially dilutive securities consisting of stock issuable under options, ESPP and RSUs are not included in the per common share calculation in periods when the inclusion of such shares would have an anti-dilutive effect. ​ Basic and diluted net income (loss) per common share is computed as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended Nine Months Ended ​ ​ September 30, ​ September 30, ​ 2020 2019 2020 2019 ​ ​ (in thousands, except share and per share data) Numerator: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income (loss) attributable to common stockholders ​ $ (12,550) ​ $ (10,224) ​ $ (55,642) ​ $ 53,787 Denominator: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-average common shares outstanding used in computing basic net income (loss) ​ 57,266,112 ​ 56,643,075 ​ ​ 57,091,452 ​ ​ 56,449,678 Effect of dilutive securities ​ ​ — ​ ​ — ​ ​ — ​ ​ 1,915,480 Weighted-average common shares outstanding used in computing diluted net income (loss) ​ ​ 57,266,112 ​ ​ 56,643,075 ​ ​ 57,091,452 ​ ​ 58,365,158 Basic net income (loss) per common share ​ $ (0.22) ​ $ (0.18) ​ $ (0.97) ​ $ 0.95 Diluted net income (loss) per common share ​ $ (0.22) ​ $ (0.18) ​ $ (0.97) ​ $ 0.92 ​ For the three and nine months ended September 30, 2020, and for the three months ended September 30, 2019, 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 anti-dilutive. For the nine months ended September 30, 2019, potentially dilutive securities consisting of 998,186 shares of stock awards are excluded from the calculation for the same period because the inclusion of such shares would have had an anti-dilutive effect.

Comprehensive Income (Loss)

Comprehensive Income (Loss)	9 Months Ended
	Sep. 30, 2020
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, 2020 and 2019, 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, 2020 and 2019.

Marketable and Equity Securitie

Marketable and Equity Securities	9 Months Ended
	Sep. 30, 2020
Marketable and Equity Securities
Marketable and Equity Securities	5. Marketable and Equity Securities ​ The Company’s marketable debt securities held as of September 30, 2020 and December 31, 2019 are summarized below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross ​ Gross ​ ​ ​ ​ Amortized Unrealized ​ Unrealized ​ September 30, 2020 ​ Cost ​ Gains ​ Losses ​ Fair Value (in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Money Market Funds ​ $ 34,512 ​ $ — ​ $ — ​ $ 34,512 Corporate Securities ​ ​ 231,385 ​ ​ 377 ​ ​ — ​ ​ 231,762 Government Securities ​ ​ 287,494 ​ ​ 204 ​ ​ (4) ​ ​ 287,694 ​ ​ $ 553,391 ​ $ 581 ​ $ (4) ​ $ 553,968 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Reported as ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ 34,512 Marketable securities ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 519,456 Total investments ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ 553,968 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross ​ Gross ​ ​ ​ ​ Amortized Unrealized ​ Unrealized ​ December 31, 2019 ​ Cost ​ Gains ​ Losses ​ Fair Value (in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Money Market Funds ​ $ 32,009 ​ $ — ​ $ — ​ $ 32,009 Corporate Securities ​ ​ 281,586 ​ ​ 195 ​ ​ (30) ​ ​ 281,751 Government Securities ​ ​ 268,239 ​ ​ 1,006 ​ ​ — ​ ​ 269,245 ​ ​ $ 581,834 ​ $ 1,201 ​ $ (30) ​ $ 583,005 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Reported as ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ 32,009 Marketable securities ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 550,996 Total investments ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ 583,005 ​ The maturities of the Company’s marketable debt securities are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortized Estimated September 30, 2020 ​ Cost ​ Fair Value (in thousands) ​ ​ ​ ​ ​ ​ Mature in one year or less ​ $ 487,108 ​ $ 487,688 Mature within two years ​ ​ 31,771 ​ ​ 31,768 ​ ​ $ 518,879 ​ $ 519,456 ​ ​ The unrealized losses on available-for-sale investments and their related fair values as of September 30, 2020 and December 31, 2019 are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less than 12 months ​ 12 months or greater ​ ​ ​ ​ ​ Unrealized ​ ​ ​ ​ Unrealized September 30, 2020 ​ Fair value ​ losses ​ Fair value ​ losses (in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Government Securities ​ ​ 25,344 ​ ​ (1) ​ ​ 31,768 ​ ​ (3) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less than 12 months ​ 12 months or greater ​ ​ ​ ​ ​ Unrealized ​ ​ ​ ​ Unrealized December 31, 2019 ​ Fair value ​ losses ​ Fair value ​ losses (in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Corporate Securities ​ $ 46,303 ​ $ (24) ​ $ 13,992 ​ $ (6) ​ The unrealized losses from the listed securities are primarily due to a change in the interest rate environment and not a change in the credit quality of the securities. ​ In connection with the Aimmune Agreement (as defined below) which we entered in February 2020, the Company received shares of Aimmune common stock which are classified as equity securities with a readily determinable fair value as of September 30, 2020. The Company recorded $2.8 million and $0.8 million of unrealized gain related to these securities in other income (expense) during the three and nine months ended September 30, 2020, respectively. We did not hold any equity securities in our investment portfolio during the year ended December 31, 2019.

Stock-Based Compensation

Stock-Based Compensation	9 Months Ended
	Sep. 30, 2020
Stock-Based Compensation
Stock-Based Compensation	6. Stock Based Compensation ​ Our Board of Directors (the Board) and the requisite stockholders previously approved the 2010 Equity Incentive Plan (the 2010 Plan). In October 2013, the Board 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, 2020, the total number of shares of common stock available for issuance under the 2013 Plan is 11,955,629, 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 the Board, the total number of shares of common stock available for issuance under the 2013 Plan was increased by 1,138,046 shares on January 1, 2020. As of September 30, 2020, a total of 10,456,289 options have been granted under the 2013 Plan. ​ In November 2013, the Board and our stockholders approved the 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 the 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 of Directors, there was no increase in the number of authorized shares in the ESPP from 2015 to 2020. As of September 30, 2020, we have issued a total of 445,621 shares of common stock under the ESPP. ​ During the nine months ended September 30, 2020, the Company awarded 328,311 RSUs to certain employees. The standard vesting of these awards is generally in three equal annual installments and is contingent on continued service to the Company. 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. In April 2020, we issued 60,000 RSUs to employees whose efforts allowed the Company to continue its operations during the COVID-19 pandemic; these RSUs vest over a one-year term in two equal six-month installments. As of September 30, 2020, we have granted a total of 433,810 shares of common stock issuable upon the vesting of RSUs. ​ Total employee, director and non-employee stock-based compensation expense recognized for the three and nine months ended September 30, 2020 and 2019 are as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended Nine Months Ended ​ ​ September 30, September 30, ​ 2020 2019 2020 2019 General and administrative ​ $ 2,881 ​ $ 2,474 ​ $ 7,975 ​ $ 6,337 Research and development ​ 5,437 ​ 7,040 ​ 15,086 ​ 18,336 ​ ​ $ 8,318 ​ $ 9,514 ​ $ 23,061 ​ $ 24,673 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Nine Months Ended ​ ​ September 30, ​ September 30, ​ ​ 2020 2019 ​ 2020 2019 Stock options ​ $ 6,624 ​ $ 9,117 ​ $ 19,172 ​ $ 23,588 ESPP ​ ​ 209 ​ ​ 217 ​ ​ 616 ​ ​ 630 Restricted stock units ​ ​ 1,485 ​ ​ 180 ​ ​ 3,273 ​ ​ 455 ​ ​ $ 8,318 ​ $ 9,514 ​ $ 23,061 ​ $ 24,673 ​ 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) Balance at December 31, 2019 7,174,319 ​ $ 24.03 ​ ​ 7.32 ​ ​ ​ Options granted 1,562,774 ​ $ 32.40 ​ ​ ​ ​ ​ ​ Options forfeited (197,669) ​ $ 31.90 ​ ​ ​ ​ ​ ​ Options exercised (392,570) ​ $ 19.69 ​ ​ ​ ​ ​ ​ Balance at September 30, 2020 8,146,854 ​ $ 25.66 ​ ​ 7.13 ​ $ 107,624 Exercisable ​ 4,796,471 ​ $ 20.90 ​ ​ 6.00 ​ $ 86,073 ​ We calculate the intrinsic value as the difference between the exercise price of the options and the closing price of common stock of $38.79 per share as of September 30, 2020. ​ Weighted-average fair value of options granted during the nine-month periods ended September 30, 2020 and 2019 were $16.60 and $20.71 per share, respectively. There were 1,920,375 options granted during the nine-month period ended September 30, 2019. 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, 2020 and 2019: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Options ​ Options ​ ​ Three Months Ended ​ Nine Months Ended ​ ​ ​ September 30, ​ September 30, ​ 2020 2019 2020 2019 Expected term (years) ​ 6.0 6.0 ​ 6.1 6.0 ​ Expected volatility ​ 56.2 % 60.8 % 54.5 % 61.2 % Risk-free interest rate ​ 0.35 % 1.52 % 0.80 % 2.33 % Expected dividend yield ​ — % — % — % — % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ESPP ​ ESPP ​ ​ Three Months Ended ​ Nine Months Ended ​ ​ September 30, ​ September 30, ​ 2020 2019 2020 2019 Expected term (years) 0.5 - 2.0 0.5 - 2.0 ​ 0.5 - 2.0 0.5 - 2.0 ​ Expected volatility ​ 50.8 - 62.6 % 55.0 - 71.4 % 50.8 - 62.6 % 55.0 - 71.4 % Risk-free interest rate 0.18 - 1.65 % 1.47 - 2.70 % 0.18 - 1.65 % 1.47 - 2.70 % Expected dividend yield ​ — % — % — % — % ​ As of September 30, 2020, the unamortized compensation expense related to unvested stock options was $53.7 million. The remaining unamortized compensation expense will be recognized over the next 2.6 years. As of September 30, 2020, the unamortized compensation expense under our ESPP was $1.1 million. The remaining unamortized expense will be recognized over the next 1.2 years. ​ The following table summarizes the RSU activity for the nine-month period ended September 30, 2020: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted ​ ​ Restricted ​ Average Grant ​ ​ Stock ​ Date Fair Value ​ ​ Units ​ (Per unit) ​ ​ ​ ​ ​ ​ Unvested RSUs at December 31, 2019 90,006 ​ $ 34.66 Granted 328,311 ​ ​ 31.92 Vested (51,722) ​ ​ 31.58 Forfeited (15,609) ​ ​ 32.46 Unvested RSUs at September 30, 2020 350,986 ​ $ 32.65 ​ As of September 30, 2020, the unamortized compensation expense related to unvested RSUs was $9.2 million. The remaining unamortized expense will be recognized over the next 2.2 years.

Leases

Leases	9 Months Ended
	Sep. 30, 2020
Leases
Leases	7. Leases ​ The Company leases office and laboratory space in Monrovia, CA under a lease that expired September 30, 2020; the original lease was a 66-month lease that expired June 2020. In April 2020, the Company entered into an amendment to the lease to extend the term of the lease under the original terms through September 2020. In September 2020, the Company entered into an amendment to extend the term of the lease under similar terms of the original lease through October 2020. In July 2017, the Company entered into a lease agreement for additional space in the same building with a lease that continues through September 2022, with an option to renew for an additional five years . The Company assesses that it is likely to exercise the option of the lease term extension. The Company also leased office space in San Diego, CA, pursuant to a lease that expired July 2020. The lease included an option to renew for an additional five years and the Company did not exercise the option to extend this lease and has vacated the space. ​ The Company leases additional office space in San Diego, CA, through August 2022, with an option to extend for an additional five years . The Company assesses that it is unlikely to exercise the option to extend the lease term. ​ The Company’s lease agreements do not contain any residual value guarantees or restrictive covenants. As of September 30, 2020, the Company did not have additional operating leases that have not yet commenced. ​ The following table reconciles the undiscounted cash flows for the operating leases at September 30, 2020 to the operating lease liabilities recorded on the balance sheet (in thousands): ​ ​ ​ ​ ​ Years ending December 31, ​ ​ For the remainder of 2020 ​ $ 655 2021 ​ 2,647 2022 ​ ​ 2,269 2023 ​ ​ 1,415 2024 ​ ​ 1,436 2025 ​ ​ 1,330 Thereafter ​ ​ 1,238 Total undiscounted lease payments ​ ​ 10,990 Less: Imputed interest ​ ​ (1,454) Present value of lease payments ​ $ 9,536 ​ ​ ​ ​ Lease liabilities - short-term ​ $ 2,158 Lease liabilities - long-term ​ ​ 7,378 Total lease liabilities ​ $ 9,536 ​ The following table summarizes lease costs and cash disclosures for the three and nine months ended September 30, 2020 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Nine Months Ended ​ ​ September 30, ​ September 30, ​ ​ 2020 2019 ​ 2020 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating lease cost ​ $ 599 ​ $ 648 ​ $ 1,896 ​ $ 1,948 Variable lease cost ​ ​ 70 ​ ​ 11 ​ ​ 129 ​ ​ 67 Total lease costs ​ $ 669 ​ $ 659 ​ $ 2,025 ​ $ 2,015 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash paid for amounts included in ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ the measurement of lease liabilities ​ $ 527 ​ $ 531 ​ $ 1,650 ​ $ 1,385 ​ Both amendments to the Monrovia, CA lease are lease modifications. Non-cash activities involving right of use assets related to the lease modification were $0.3 million and $0.4 million for three and nine months ended September 30, 2020, respectively. ​ As of September 30, 2020, the weighted-average remaining lease term for operating leases is 5.1 years, and the weighted-average discount rate for operating leases is 5.5% ​

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2020
Commitments and Contingencies
Commitments and Contingencies	8. Commitments and Contingencies ​ 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. ​ The Company is 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 the Company’s balance sheet. The Company has 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. Pursuant to a collaboration agreement with the University of Texas MD Anderson Cancer Center (MD Anderson), the Company is committed to providing $10.0 million in funding to support clinical studies over a five-year period beginning August 2020.

Collaboration and Licensing Agr

Collaboration and Licensing Agreements	9 Months Ended
	Sep. 30, 2020
Collaboration and Licensing Agreements
Collaboration and Licensing Agreements	9. Collaboration and Licensing Agreements ​ The following is a summary description of the material revenue arrangements, including arrangements that generated revenue in the three and nine months ended September 30, 2020 and 2019. ​ Genentech, Inc. and F. Hoffman-La Roche Ltd. In February 2019, the Company entered into a collaboration and license agreement (the Genentech Agreement) with Genentech, Inc. and F. Hoffman-La Roche Ltd (collectively, Genentech) for the development and commercialization of novel IL-15 collaboration products (Collaboration Products), including XmAb24306 (also named RG6323), the Company’s IL-15/IL-15Ra candidate. The Genentech Agreement became effective March 8, 2019. Under the terms of the Genentech Agreement, Genentech received an exclusive worldwide license to XmAb24306 and other Collaboration Products, including any new IL-15 programs identified during the joint research collaboration. Genentech and the Company will jointly collaborate on worldwide development of XmAb24306 and potentially other Collaboration Products with Genentech maintaining all worldwide commercialization rights, subject to the Company having an option to co-promote in the United States. The Company has the right to perform clinical studies of Collaboration Products in combination with other therapeutic agents at its own cost, subject to certain requirements. The Company received a $120.0 million upfront payment and is eligible to receive up to an aggregate of $160.0 million in clinical milestone payments for each Collaboration Product that advances to Phase 3 clinical trials. The Company is also eligible to receive 45% share of net profits for sales of XmAb24306 and other Collaboration Products, while also sharing in net losses at the same percentage rate. The parties will jointly share in development and commercialization costs for all programs designated as a development program under the Genentech Agreement at the same percentage rate, while Genentech will bear launch costs entirely. The initial 45% profit-cost share percent is subject to ratchet down at the Company’s discretion and convertible to a royalty under certain restrictions. Pursuant to the Genentech Agreement, XmAb24306 is designated as a development program and all costs incurred for developing XmAb24306 from March 8, 2019, the effective date of the Genentech Agreement, are being shared with Genentech under the initial cost-sharing percentage of 45%. Pursuant to the Genentech Agreement, the Company and Genentech will conduct joint research activities for a two -year period to identify and discover additional IL-15 candidates developed from the Company’s cytokine and bispecific technologies. The two-year research term may be extended an additional year if both parties agree. The Company and Genentech are each responsible for their own costs in conducting the research activities. The Company is eligible for clinical milestone payments for new Collaboration Products identified from the research efforts. The Company recognized the $111.7 million allocated to the license when it satisfied its performance obligation and transferred the license to Genentech in March 2019. A total of $8.3 million of the transaction price was allocated to the research activities and is being recognized over a period of time through the end of the research term that services are rendered. A total of $0.9 million and $2.3 million of revenue related to the research activities was recognized in the three and nine-month periods ended September 30, 2020, respectively. For the three months ended September 30, 2020 and 2019, the Company recognized $0.9 million and $0.7 million of income, respectively, from the Genentech Agreement. For the nine months ended September 30, 2020 and 2019, the Company recognized $2.3 million and $113.2 million of income, respectively. As of September 30, 2020, there is a $1.2 million payable related to cost-sharing development activities during the third quarter of 2020 for the XmAb24306 program. There is $3.7 million in deferred revenue as of September 30, 2020 which reflects the Company’s obligation to perform research services during the remaining research term. Astellas Pharma Inc. Effective March 29, 2019, the Company entered into a Research and License Agreement (the Astellas Agreement) with Astellas Pharma Inc. (Astellas) pursuant to which the Company and Astellas will conduct a discovery program to characterize compounds and products for development and commercialization. Under the Astellas Agreement, Astellas was granted a worldwide exclusive license, with the right to sublicense products in the field created by the research activities. Pursuant to the Astellas Agreement, the Company will apply its bispecific Fc technology to research antibodies provided by Astellas to generate bispecific antibody candidates and will conduct limited testing and characterization of the bispecific candidates and return the candidates to Astellas for development and commercialization. The activities will be conducted under a research plan agreed to by both parties to the Astellas Agreement. Astellas will assume full responsibility for development and commercialization of the antibody candidate. Pursuant to the Astellas Agreement, the Company received an upfront payment of $15.0 million and is eligible to receive up to $240.0 million in milestones which include $32.5 million in development milestones, $57.5 million in regulatory milestones and $150.0 million in sales milestones. If commercialized, the Company is eligible to receive royalties on net sales that range from the high-single to low-double digit percentages. The Company recognized the $13.6 million allocated to the bispecific antibodies when it satisfied its performance obligation and transferred the bispecific antibodies to Astellas in June 2019. The $1.4 million allocated to the research activities is being recognized as the research services are being completed over the period of time the Company expects to complete the activities under the research plan. The Company completed the remaining activities under the research plan during the second quarter of 2020. For the three months ended September 30, 2020 and 2019, the Company did not recognize revenue related to the arrangement. For the nine months ended September 30, 2020 and 2019, the Company recognized $0.9 million and $13.8 million of revenue, respectively. There is no deferred revenue as of September 30, 2020 related to the arrangement. Novartis Institute for Biomedical Research, Inc. 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 engineered antibody drug candidates using the Company’s proprietary XmAb technologies and drug candidates. The Company received an upfront payment of $150.0 million and is eligible to receive additional development, regulatory and sales milestones. Pursuant to the Novartis Agreement: ● the Company granted Novartis certain exclusive rights to research, develop, and commercialize vibecotamab (XmAb14045) and plamotamab (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. Under the Novartis Agreement, the Company and Novartis are co-developing vibecotamab worldwide and sharing development costs. In December 2018, Novartis notified the Company it was terminating its rights with respect to the plamotamab program, which became effective June 2019. The Company has completed delivery of two target pair antibodies under the Novartis Agreement and in December 2019 Novartis initiated a Phase 1 study with one of the target pair antibodies. No revenue was recognized during the three and nine months ended September 30, 2020 from the Novartis Agreement. The Company recognized $10.0 million of milestone revenue during the three and nine months ended September 30, 2019. As of September 30, 2020, there is a receivable of $1.1 million related to cost-sharing of development activities for the third quarter of 2020 for the vibecotamab program, and $40.1 million in deferred revenue related to the obligation to deliver two additional Global Discovery Programs to Novartis under 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 the rights to our CD38 x CD3 preclinical program and developed AMG 424. Amgen also applied our bispecific Fc technology to create AMG 509, a STEAP1 x CD3 XmAb 2+1 bispecific antibody. The Company has received a total of $60.5 million in upfront payments and milestone payments and is eligible to receive up to $255.0 million in future development, regulatory and sales milestone payments in total for the STEAP1 x CD3 program and is eligible to receive royalties on any global net sales of products. In May 2020, Amgen notified the Company that it was terminating its rights with respect to the CD38 x CD3 program, including AMG 424, which termination became effective in July 2020. Under the terms of the Amgen Agreement, the rights to the AMG 424 program reverted to the Company in connection with the termination. No revenue was recognized under the arrangement during the three and nine months ended September 30, 2020. The Company recognized $5.0 million of milestone revenue during the three and nine months ended September 30, 2019. As of September 30, 2020, there is no deferred revenue related to the arrangement. MorphoSys AG In June 2010, the Company entered into a Collaboration and License Agreement with MorphoSys AG (MorphoSys), which was subsequently amended. Under the agreement, we granted MorphoSys an exclusive worldwide license to the Company’s patents and know-how to research, develop and commercialize the XmAb5574 product candidate (subsequently renamed MOR208 and tafasitamab) with the right to sublicense under certain conditions. If certain developmental, regulatory and sales milestones are achieved, the Company is eligible to receive future milestone payments and royalties. In February 2020, the U.S. Food and Drug Administration (FDA) accepted MorphoSys’ Biologics License Application (BLA) for tafasitamab and the Company received a milestone payment of $12.5 million. The Company recognized the payment as revenue in the period that the milestone event occurred. On July 31, 2020, the FDA approved MorphoSys’ BLA for tafasitamab (now Monjuvi®) for marketing in the United States. In connection with the approval, the Company received a milestone payment of $25.0 million. The Company is eligible to receive royalties in the high-single to low-double digit percentage range on approved sales of Monjuvi. Under ASC 606, the Company recognizes revenue for sales-based royalties upon the subsequent sale of the product. We record royalties for Monjuvi based on an estimate of sales that were recorded by MorphoSys from the date that the drug was approved by the FDA. The Company recognized $25.0 million and $37.5 million of milestone revenue under this arrangement for the three and nine months ended September 30, 2020, respectively. The Company also recognized $0.2 million of royalty revenue during the three months ended September 30, 2020. No revenue was recognized under this arrangement for the three and nine months ended September 30, 2019. As of September 30, 2020, there is no deferred revenue related to this agreement. Alexion Pharmaceuticals, Inc. In January 2013, the Company entered into an Option and License Agreement (the Alexion Agreement) with Alexion Pharmaceuticals, Inc. (Alexion). Under the terms of the Alexion Agreement, the Company granted to Alexion an exclusive research license, with limited sublicensing rights, to make and use the Company’s Xtend technology to evaluate and advance compounds. Alexion exercised its rights to one target program, ALXN1210, which is now marketed as Ultomiris®. The Company is eligible to receive contractual milestones for certain commercial achievements and is also entitled to receive royalties based on a percentage of net sales of Ultomiris sold by Alexion, its affiliates or its sublicensees, which percentage is in the low single digits. Alexion’s royalty obligations 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. Under ASC 606, the Company recognizes revenue for sales-based royalties upon the subsequent sale of the product. We began earning royalty revenue from the sale of Ultomiris in 2019. The Company recognized $4.3 million and $1.4 million of royalty revenue under this arrangement for the three months ended September 30, 2020 and 2019, respectively. The Company also recognized $4.0 million of milestone revenue for the three months ended September 30, 2019. The Company recognized total revenue of $11.5 million and $10.5 million for the nine months ended September 30, 2020 and 2019, respectively. As of September 30, 2020, there is a receivable of $8.1 million related to royalties due under the arrangement. There is no deferred revenue related to this agreement. INmune Bio, Inc. In October 2017, the Company entered into a License Agreement (the INmune Agreement) with INmune Bio, Inc. (INmune). Under the terms of the INmune Agreement, the Company provided INmune with an exclusive license to certain rights to a proprietary protein, XPRO1595. Under the agreement the Company received an upfront payment of $100,000, 1,585,000 shares of INmune common stock and an option to acquire additional shares of INmune. The Company is also eligible to receive a percentage of sublicensing revenue received for XPRO1595 and royalties in the mid-single digit percentage range on the sale of approved products. The option has a six-year term from the date of the INmune Agreement and provides the Company the option to purchase up to 10% of the fully diluted outstanding shares of INmune for $10.0 million. The Company has recorded its equity interest in INmune at cost pursuant to ASC 323. The Company did not record its share of the net loss from INmune during the three and nine months ended September 30, 2020 or 2019, respectively, as the carrying value of this investment has been reduced to zero . The Company did not recognize any revenue related to the INmune Agreement for the three and nine months ended September 30, 2020 and 2019. There is no deferred revenue as of September 30, 2020 related to this agreement. Vir Biotechnology, Inc. In the third quarter of 2019, the Company entered into a Patent License Agreement (the Vir Agreement) with Vir Biotechnology, Inc. (Vir) pursuant to which the Company provided a non-exclusive license to its Xtend technology for up to two targets. Under the terms of the Vir Agreement, the Company received an upfront payment and is eligible to receive total milestones of $155.25 million which include $5.25 million of development milestones, $30.0 million of regulatory milestones and $120.0 million of sales milestones. In addition, the Company is eligible to receive royalties on the net sales of approved products in the low single digit percentage range. The Company evaluated the Vir Agreement and determined that the single performance obligation was access to a non-exclusive license to certain patents of the Company which were transferred to Vir upon execution of the Vir Agreement in July 2019. Vir initiated a Phase 1 study with a licensed antibody in 2019 and in the second quarter of 2020 it initiated a Phase 1 study with a second licensed antibody. In March 2020, the Company entered into a second Patent License Agreement (the Second Vir Agreement) with Vir pursuant to which the Company provided a non-exclusive license to its Xtend technology to extend the half-life of novel antibodies Vir is investigating as potential treatments for patients with COVID-19. Under the terms of the Second Vir Agreement, Vir is responsible for all research, development, regulatory and commercial activities for the antibody, and the Company is eligible to receive royalties on the net sales of approved products in the mid-single digit percentage range. Vir initiated a Phase 2 study with a licensed antibody to treat patients with COVID-19 in the third quarter of 2020 and it announced it advanced the study to Phase 3 in the fourth quarter of 2020. The Company determined that the Second Vir Agreement was a modification of the original agreement and the transfer of the license occurred at inception of the Vir Agreement. The total consideration under the arrangement did not change with the Second Vir Agreement as the Company will potentially receive additional royalty revenue which is variable consideration and is not included in the transaction price. The Company recognized $0.3 million and $0.7 million milestone revenue for the nine months ended September 30, 2020 and 2019, respectively. The Company did not recognize revenue related to the agreement for the three months ended September 30, 2020. There is no deferred revenue as of September 30, 2020 related to this agreement. Aimmune Therapeutics, Inc. On February 4, 2020, the Company entered into a License, Development and Commercialization Agreement (the Aimmune Agreement) with Aimmune Therapeutics, Inc. (Aimmune) pursuant to which the Company granted Aimmune an exclusive worldwide license to XmAb7195, which was renamed AIMab7195. Under the Aimmune Agreement, Aimmune will be responsible for all further development and commercialization activities for XmAb7195. The Company received an upfront payment of $5.0 million and 156,238 shares of Aimmune common stock with an aggregate value of $4.6 million on the closing date. Under the Aimmune Agreement, the Company is also eligible to receive up to $385.0 million in milestones, which include $22.0 million in development milestones, $53.0 million in regulatory milestones and $310.0 million in sales milestones, and tiered royalties on net sales of approved products from high-single to mid-teen percentage range. Under the Aimmune Agreement, Aimmune received exclusive worldwide rights to manufacture, develop and commercialize XmAb7195. They also received the rights to all data, information and research materials related to the XmAb7195 program. The Company evaluated the Aimmune Agreement under the revenue recognition standard ASC 606 and identified the following performance obligations that it deemed to be distinct at the inception of the contract: ● license to the rights to the XmAb7195 drug candidate; and ● rights to material, data, and information that the Company had accumulated in connection with manufacturing, testing, and conducting clinical trials for the XmAb7195 program and intellectual property filings and information (XmAb7195 data). The Company considered the licenses as functional intellectual property as Aimmune has the right to use XmAb7195 at the time that the Company transfers such rights. The rights to the XmAb7195 data are not considered to be separate from the license to XmAb7195 as Aimmune cannot benefit from the license without the supporting data and documentation. The Company determined the transaction price at inception is $9.6 million which consists of the $5.0 million upfront payment and the 156,238 shares of Aimmune common stock which had a value of $4.6 million on the closing date. The Company determined that the transaction price is to be allocated to the performance obligations. The Aimmune Agreement includes variable consideration for potential future milestones and royalties that were contingent on future success factors for the XmAb7195 program. The Company used the “most likely amount” 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 Aimmune Agreement and allocated it to the performance obligation, delivery of the XmAb7195 license. The Company completed delivery of its performance obligations in March 2020. The license to XmAb7195 was transferred to Aimmune at inception of the Aimmune Agreement, and the XmAb7195 data was transferred to Aimmune in March 2020. No revenue was recognized in the three months ended September 30, 2020. The Company recognized $9.6 million of revenue related to the agreement for the nine months ended September 30, 2020. There is no deferred revenue as of September 30, 2020 related to this agreement. Gilead Sciences, Inc. In January 2020, the Company entered into a Technology License Agreement (the Gilead Agreement) with Gilead Sciences, Inc. (Gilead), in which the Company provided an exclusive license to its Cytotoxic Fc and Xtend Fc technologies for an initial identified antibody and options for up to three additional antibodies directed to the same molecular target. The Company retains the right to grant licenses for other antibodies directed to the target, subject to the Company’s approval. Gilead is responsible for all development and commercialization activities for all target candidates. The Company received an upfront payment of $6.0 million and is eligible to receive up to $67.0 million in milestones, which include $10.0 million in development milestones, $27.0 million in regulatory milestones and $30.0 million in sales milestones for each product incorporating the antibodies selected. In addition, the Company is eligible to receive royalties in the low-single digit percentage range on net sales of approved products. In the second quarter of 2020, Gilead exercised options on three additional antibody compounds and in April 2020, we received a total of $7.5 million in payment of the three options. The Company evaluated the Gilead Agreement under the revenue recognition standard ASC 606 and identified the following performance obligations that it deemed to be distinct at the inception of the contract: ● non-exclusive license to its Cytotoxic Fc and Xtend Fc technologies; and ● options for four exclusive commercial licenses to incorporate the licensed technologies on approved target compounds. The Company considered the licenses as functional intellectual property as Gilead has the right to use the technologies at the time that the Company transfers such rights. Each of the four options is considered a separate performance obligation as the arrangement does not confer material rights to the options without payment of the option exercise fee. Gilead will benefit from each option upon exercise of each of the four options and payment of each option fee as Gilead has access to each technology at inception of the arrangement and the rights are transferred upon payment of each option fee. The total transaction price is $13.5 million which includes the upfront payment of $6.0 million and the option fee payment of $7.5 million which was contractually due with the exercise of the three options by Gilead. The milestone payments are variable consideration to which the Company applied the “most likely amount” method and concluded at inception of the Gilead Agreement it is unlikely that the Company will collect such payments. The milestone payments were not included in the transaction price and the Company will review this conclusion and update at each reporting period. The Company allocated $3.5 million of the transaction price to the licenses to the cytotoxic Fc and Xtend Fc technologies and recognized income for the licenses at inception of the arrangement when Gilead began benefiting access to them. The Company allocated The Company recognized Omeros Corporation In August 2020, the Company entered into a Technology License Agreement (the Omeros Agreement) with Omeros Corporation. (Omeros), in which the Company provided a non-exclusive license to its Xtend Fc technology, an exclusive license to apply its Xtend technology to an initial identified antibody and options to apply its Xtend technology to three additional antibodies. Omeros is responsible for all development and commercialization activities for all target candidates. The Company received an upfront payment of $5.0 million and is eligible to receive up to $65.0 million in milestones, which include $15.0 million in development milestones, $25.0 million in regulatory milestones and $25.0 million in sales milestones for each product incorporating the antibodies selected. In addition, the Company is eligible to receive royalties in the mid-single digit percentage range on net sales of approved products. The Company evaluated the Omeros Agreement under the revenue recognition standard ASC 606 and identified the following performance obligations that it deemed to be distinct at the inception of the contract: ● non-exclusive license to its Xtend Fc technologies; and ● options for four exclusive commercial licenses to incorporate the licensed technologies on approved target compounds, The Company considered the license as functional intellectual property as Omeros has the right to use the technology at the time that the Company transfers such rights. Each of the four options is considered a separate performance obligation as the arrangement does not confer material rights to the options without payment of the option exercise fee. Omeros will benefit from each option upon exercise of each of the four options and payment of each option fee as Omeros has access to each technology at inception of the arrangement and the rights are transferred upon payment of each option fee. The total transaction price is $5.0 million, which includes the upfront payment. The milestone payments are variable consideration to which the Company applied the “most likely amount” method and concluded at inception of the Omeros Agreement it is unlikely that the Company will collect such payments. The milestone payments were not included in the transaction price and the Company will review this conclusion and update at each reporting period. The Company allocated $2.0 million of the transaction price to the licenses to the Xtend Fc technology and recognized income for the licenses at inception of the arrangement when Omeros began benefiting access to it. The Company allocated The Company recognized Atreca, Inc. In July 2020, the Company entered into a Collaboration and License Agreement (the Atreca Agreement) with Atreca, Inc. (Atreca), to research, develop and commercialize novel CD3 bispecific antibodies as potential therapeutics in oncology. Under the Atreca Agreement, the companies will engage in a three-year research program in which Atreca will provide antibodies against novel tumor targets through its discovery platform from which the Company will engineer XmAb bispecific antibodies that also bind to the CD3 receptor on T cells. The two companies will share research costs equally during the research term. Up to two joint programs are eligible to be mutually selected for further development and commercialization, with each partner sharing fifty percent of costs and profits. Each company has the option to lead development, regulatory and commercialization activities for one of the joint programs. In addition, the agreement allows each partner the option to pursue up to two programs independently, with a mid-to high-single digit percentage royalty payable on net sales to the other partner. The Company evaluated the Atreca Agreement and determined it is a collaboration agreement under ASC 808 with the two companies conducting joint research activities and sharing costs. The Company will reevaluate the Atreca Agreement during the period of the research term. There was no revenue recognized in connection with the Atreca Agreement for the three and nine months ended September 30, 2020. There is a payable of $0.1 million as of September 30, 2020 related to cost-sharing activities conducted under the Agreement. MD Anderson In August 2020, the Company entered into a Strategic Collaboration Agreement (the MD Anderson Agreement) with MD Anderson in which the Company agreed to provide $10.0 million of funding over a five-year period to support research and Investigator Sponsored Trials (ISTs) with Company-provided drug candidates. Under the MD Anderson Agreement, the Company will provide $2.0 million in annual funding for a five-year period and provide drug product from certain of its ongoing clinical programs to MD Anderson. The Company and MD Anderson will agree on protocols, indications and budgets for each IST that will be conducted exclusively by MD Anderson. No expenses were incurred in connection with the collaboration for the three and nine months ended September 30, 2020. Revenue earned The revenues recorded for the three and nine months ended September 30, 2020 were earned principally from the following licensees (in millions): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended Nine Months Ended ​ ​ September 30, September 30, ​ ​ 2020 ​ 2019 2020 ​ 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ Aimmune ​ $ — $ — ​ $ 9.6 ​ $ — Alexion ​ 4.3 ​ ​ 5.4 ​ ​ 11.5 ​ 10.5 Amgen ​ ​ — ​ ​ 5.0 ​ ​ — ​ ​ 5.0 Astellas ​ ​ — ​ ​ — ​ ​ 0.9 ​ ​ 13.8 Genentech ​ ​ 0.9 ​ ​ 0.7 ​ ​ 2.3 ​ ​ 113.2 Gilead ​ ​ — ​ ​ — ​ ​ 13.5 ​ ​ — MorphoSys ​ ​ 25.2 ​ ​ — ​ ​ 37.7 ​ ​ — Novartis ​ ​ — ​ 10.0 ​ ​ — ​ 10.0 Omeros ​ ​ 5.0 ​ ​ — ​ ​ 5.0 ​ ​ — Vir ​ ​ — ​ 0.7 ​ ​ 0.3 ​ 0.7 Total ​ $ 35.4 ​ $ 21.8 ​ $ 80.8 ​ $ 153.2 ​ The table below summarizes the disaggregation of revenue recorded for the three and nine months ended September 30, 2020 (in millions): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended Nine Months Ended ​ ​ September 30, September 30, ​ ​ 2020 ​ 2019 2020 ​ 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ Research collaboration $ 0.9 $ 0.6 ​ $ 3.2 $ 15.2 Milestone ​ ​ 25.0 ​ 19.3 ​ ​ 37.8 ​ 23.3 Licensing ​ ​ 5.0 ​ 0.5 ​ ​ 28.1 ​ 112.2 Royalties ​ ​ 4.5 ​ ​ 1.4 ​ ​ 11.7 ​ ​ 2.5 Total ​ $ 35.4 ​ $ 21.8 ​ $ 80.8 ​ $ 153.2 ​ Remaining Performance Obligations and Deferred Revenue The Company’s remaining performance obligations are delivery of two Global Discovery Programs under the Novartis Agreement and conducting research activities pursuant to research plans under the Genentech Agreement. We have completed the remaining research activities pursuant to the research plan under the Astellas Agreement in the second quarter of 2020. As of September 30, 2020 and 2019, the Company has deferred revenue of $43.8 million and $48.2 million, respectively. As of September 30, 2020, all deferred revenue is classified as current liabilities as the Company’s obligations to perform services are due on demand when requested by Novartis under the Novartis Agreement and the Company’s obligation to perform research services to Genentech will end upon expiration of the research term in March 2021. As of September 30, 2019, $45.6 million was classified as current liabilities for the same reason, and $2.6 million of the deferred revenue liability was classified as long-term for the portion of obligations to perform research services to Genentech after one year .

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2020
Income Taxes
Income Taxes	10. Income taxes ​ On March 27, 2020, the President of the United States signed the Coronavirus Aid, Relief and Economic Security (CARES) Act. The legislation provides several changes to corporation income taxes including: ​ ● modification of the rules applicable to the deductibility of net operation losses (NOLs) incurred in tax years beginning in 2018, 2019 and 2020, and ● acceleration of the corporate minimum tax credit. ​ The Company reviewed the new legislation and determined that certain provisions would provide income tax benefits: ​ ● The Company has NOL and income tax credit carryforwards which are subject to a valuation allowance, due to uncertainty about the ability to utilize such losses and credits in future periods. Accordingly, the Company does not expect the changes in the NOL provisions in the legislation to provide any benefit in the near-term. ● As of December 31, 2019, the Company had recorded a receivable of $0.8 million related to the corporate minimum tax credit. Under previous income tax provisions, one-half of the minimum tax credit would be received in 2020 and the remainder in subsequent years. As a result of the new legislation, the Company received a refund for the entire $0.8 million minimum tax credit in 2020. ​ There was no provision for income taxes for the three and nine months ended September 30, 2020. The provision for income taxes of $0.6 million for the nine months ended September 30, 2019 represents the interim period tax allocation of the state alternative minimum tax based on the Company’s projected year-end effective income tax rates which cannot be offset by the Company’s NOL carryforwards. The Company has received a federal income tax refund of $0.8 million in July 2020 related to refundable alternative minimum tax credits. As of September 30, 2020, the Company’s deferred income tax assets, consisting primarily of NOL and tax credit carryforwards, have been fully offset by a valuation allowance. ​

Subsequent Events

Subsequent Events	9 Months Ended
	Sep. 30, 2020
Subsequent Events
Subsequent Events	11. Subsequent Events ​ In October 2020, the shares of Aimmune were liquidated in connection with the acquisition of all of the outstanding stock of Aimmune by a wholly-owned subsidiary of Nestlé S.A. (Nestle), and the Company received total proceeds of $5.4 million in exchange for its 156,238 shares of Aimmune common stock.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Polices)	9 Months Ended
	Sep. 30, 2020
Summary of Significant Accounting Policies
Basis of Presentation	Basis of Presentation ​ The accompanying unaudited interim financial statements for Xencor, Inc. (the Company, Xencor, we or us) have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information. 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 2019 Annual Report on Form 10-K filed with the Securities and Exchange Commission (SEC) on February 25, 2020.
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 royalties and accrued research and development expenses, stock-based compensation expenses, intangible assets and related amortization, estimated standalone selling price of performance obligations, the likelihood of recognizing variable consideration, and recoverability of deferred tax assets.
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, 2020 and 2019. ​ The Company capitalizes certain in-process intangible assets that are then abandoned when they are no longer pursued or used in current research activities. There was no material abandonment of in-process intangible assets during the three and nine months ended September 30, 2020 and 2019.
Marketable and Equity Securities	Marketable and Equity 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 debt securities issued by investment grade institutions. ​ The Company considers its marketable debt securities to be available-for-sale and 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. These assets are carried at fair value and any impairment losses and recoveries related to the underlying issuer’s credit standing are recognized within other income (expense), while non-credit related impairment losses and recoveries are recognized within accumulated other comprehensive income (loss). There were no impairment losses or recoveries recorded for the three and nine months ended September 30, 2020 and 2019. Accrued interest on marketable debt securities is included in marketable securities’ carrying value. Each reporting period, the Company reviews its portfolio of marketable debt securities, using both quantitative and qualitative factors, to determine if each security’s fair value has declined below its amortized cost basis. ​ The Company also has an investment in an equity security that is carried at fair value with changes in fair value recognized within other income (expense). For equity securities with a readily determinable fair value, the Company remeasures these equity investments at each reporting period until such time that the investment is sold or disposed. If the Company sells an investment, any realized gains and losses on the sale of the securities will be recognized within other income (expense) in the Statement of Comprehensive Income (Loss) in the period of sale.
Recent Accounting Pronouncements	Recent Accounting Pronouncements ​ Pronouncements Adopted in 2020 ​ Effective January 1, 2020, the Company adopted ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, as well as ASU No, 2018-19, Codification Improvements to Topic 326, Financial Instruments – Credit Losses. The standard amends guidance on reporting credit losses for assets held at amortized cost basis and also provides an available-for-sale (AFS) debt security impairment model that is a modified version of the other-than-temporary-impairment (OTTI) model. The AFS debt security impairment model no longer allows consideration of the length of time during which the fair value has been less than its amortized cost when determining whether a credit loss exists. The adoption of this standard did not have any impact on the Company’s financial statements. ​ Effective January 1, 2020, the Company adopted 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 adoption of this standard did not have any impact on the Company’s financial statements. ​ Effective January 1, 2020, the Company adopted ASU No. 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction Between Topic 808 and Topic 606, which provides guidance on how to assess whether certain transactions between collaborative arrangement participants should be accounted for within the revenue recognition standard. The adoption of this standard did not have any impact on the Company’s financial statements. ​ Pronouncements Not Yet Effective ​ In December 2019, the Financial Accounting Standards Board (FASB) issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes ​ In January 2020, the FASB issued ASU No. 2020-01, which clarifies that a company should consider observable transactions that require a company to either apply or discontinue the equity method of accounting under Topic 323, Investment – Equity Method and Joint Ventures, for the purposes of applying the measurement alternative in accordance with Topic 321, Investments – Equity Securities ​ There have been no other material changes to the significant accounting policies previously disclosed in the Company’s 2019 Annual Report on Form 10-K.

Fair Value of Financial Instr_2

Fair Value of Financial Instruments (Tables)	9 Months Ended
	Sep. 30, 2020
Fair Value of Financial Instruments
Schedule of assets recorded at fair value	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, 2020 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (unaudited) ​ December 31, 2019 ​ Total ​ ​ ​ ​ Total ​ ​ ​ ​ ​ ​ Fair Value ​ Level 1 ​ Level 2 ​ Fair Value ​ Level 1 ​ Level 2 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Money Market Funds ​ $ 34,512 ​ $ 34,512 ​ $ — ​ $ 32,009 ​ $ 32,009 ​ $ — Corporate Securities ​ ​ 231,762 ​ ​ — ​ ​ 231,762 ​ ​ 281,751 ​ ​ — ​ ​ 281,751 Government Securities ​ ​ 287,694 ​ ​ — ​ ​ 287,694 ​ ​ 269,245 ​ ​ — ​ ​ 269,245 Equity Securities with Readily Determinable Fair Value ​ ​ 5,382 ​ ​ 5,382 ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ $ 559,350 ​ $ 39,894 ​ $ 519,456 ​ $ 583,005 ​ $ 32,009 ​ $ 550,996

Net Income (Loss) Per Share (Ta

Net Income (Loss) Per Share (Tables)	9 Months Ended
	Sep. 30, 2020
Net Income (Loss) Per Share
Schedule of basic and diluted net income (loss) per common share	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended Nine Months Ended ​ ​ September 30, ​ September 30, ​ 2020 2019 2020 2019 ​ ​ (in thousands, except share and per share data) Numerator: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income (loss) attributable to common stockholders ​ $ (12,550) ​ $ (10,224) ​ $ (55,642) ​ $ 53,787 Denominator: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-average common shares outstanding used in computing basic net income (loss) ​ 57,266,112 ​ 56,643,075 ​ ​ 57,091,452 ​ ​ 56,449,678 Effect of dilutive securities ​ ​ — ​ ​ — ​ ​ — ​ ​ 1,915,480 Weighted-average common shares outstanding used in computing diluted net income (loss) ​ ​ 57,266,112 ​ ​ 56,643,075 ​ ​ 57,091,452 ​ ​ 58,365,158 Basic net income (loss) per common share ​ $ (0.22) ​ $ (0.18) ​ $ (0.97) ​ $ 0.95 Diluted net income (loss) per common share ​ $ (0.22) ​ $ (0.18) ​ $ (0.97) ​ $ 0.92

Marketable and Equity Securit_2

Marketable and Equity Securities (Tables)	9 Months Ended
	Sep. 30, 2020
Marketable and Equity Securities
Schedule of marketable securities	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross ​ Gross ​ ​ ​ ​ Amortized Unrealized ​ Unrealized ​ September 30, 2020 ​ Cost ​ Gains ​ Losses ​ Fair Value (in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Money Market Funds ​ $ 34,512 ​ $ — ​ $ — ​ $ 34,512 Corporate Securities ​ ​ 231,385 ​ ​ 377 ​ ​ — ​ ​ 231,762 Government Securities ​ ​ 287,494 ​ ​ 204 ​ ​ (4) ​ ​ 287,694 ​ ​ $ 553,391 ​ $ 581 ​ $ (4) ​ $ 553,968 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Reported as ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ 34,512 Marketable securities ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 519,456 Total investments ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ 553,968 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross ​ Gross ​ ​ ​ ​ Amortized Unrealized ​ Unrealized ​ December 31, 2019 ​ Cost ​ Gains ​ Losses ​ Fair Value (in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Money Market Funds ​ $ 32,009 ​ $ — ​ $ — ​ $ 32,009 Corporate Securities ​ ​ 281,586 ​ ​ 195 ​ ​ (30) ​ ​ 281,751 Government Securities ​ ​ 268,239 ​ ​ 1,006 ​ ​ — ​ ​ 269,245 ​ ​ $ 581,834 ​ $ 1,201 ​ $ (30) ​ $ 583,005 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Reported as ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ 32,009 Marketable securities ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 550,996 Total investments ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ 583,005
Schedule of maturities of marketable securities	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortized Estimated September 30, 2020 ​ Cost ​ Fair Value (in thousands) ​ ​ ​ ​ ​ ​ Mature in one year or less ​ $ 487,108 ​ $ 487,688 Mature within two years ​ ​ 31,771 ​ ​ 31,768 ​ ​ $ 518,879 ​ $ 519,456
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, 2020 and December 31, 2019 are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less than 12 months ​ 12 months or greater ​ ​ ​ ​ ​ Unrealized ​ ​ ​ ​ Unrealized September 30, 2020 ​ Fair value ​ losses ​ Fair value ​ losses (in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Government Securities ​ ​ 25,344 ​ ​ (1) ​ ​ 31,768 ​ ​ (3) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less than 12 months ​ 12 months or greater ​ ​ ​ ​ ​ Unrealized ​ ​ ​ ​ Unrealized December 31, 2019 ​ Fair value ​ losses ​ Fair value ​ losses (in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Corporate Securities ​ $ 46,303 ​ $ (24) ​ $ 13,992 ​ $ (6)

Stock-Based Compensation (Table

Stock-Based Compensation (Tables)	9 Months Ended
	Sep. 30, 2020
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, ​ 2020 2019 2020 2019 General and administrative ​ $ 2,881 ​ $ 2,474 ​ $ 7,975 ​ $ 6,337 Research and development ​ 5,437 ​ 7,040 ​ 15,086 ​ 18,336 ​ ​ $ 8,318 ​ $ 9,514 ​ $ 23,061 ​ $ 24,673 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Nine Months Ended ​ ​ September 30, ​ September 30, ​ ​ 2020 2019 ​ 2020 2019 Stock options ​ $ 6,624 ​ $ 9,117 ​ $ 19,172 ​ $ 23,588 ESPP ​ ​ 209 ​ ​ 217 ​ ​ 616 ​ ​ 630 Restricted stock units ​ ​ 1,485 ​ ​ 180 ​ ​ 3,273 ​ ​ 455 ​ ​ $ 8,318 ​ $ 9,514 ​ $ 23,061 ​ $ 24,673
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) Balance at December 31, 2019 7,174,319 ​ $ 24.03 ​ ​ 7.32 ​ ​ ​ Options granted 1,562,774 ​ $ 32.40 ​ ​ ​ ​ ​ ​ Options forfeited (197,669) ​ $ 31.90 ​ ​ ​ ​ ​ ​ Options exercised (392,570) ​ $ 19.69 ​ ​ ​ ​ ​ ​ Balance at September 30, 2020 8,146,854 ​ $ 25.66 ​ ​ 7.13 ​ $ 107,624 Exercisable ​ 4,796,471 ​ $ 20.90 ​ ​ 6.00 ​ $ 86,073
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, ​ 2020 2019 2020 2019 Expected term (years) ​ 6.0 6.0 ​ 6.1 6.0 ​ Expected volatility ​ 56.2 % 60.8 % 54.5 % 61.2 % Risk-free interest rate ​ 0.35 % 1.52 % 0.80 % 2.33 % 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, ​ 2020 2019 2020 2019 Expected term (years) 0.5 - 2.0 0.5 - 2.0 ​ 0.5 - 2.0 0.5 - 2.0 ​ Expected volatility ​ 50.8 - 62.6 % 55.0 - 71.4 % 50.8 - 62.6 % 55.0 - 71.4 % Risk-free interest rate 0.18 - 1.65 % 1.47 - 2.70 % 0.18 - 1.65 % 1.47 - 2.70 % Expected dividend yield ​ — % — % — % — %
Summary of restricted stock unity activity	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted ​ ​ Restricted ​ Average Grant ​ ​ Stock ​ Date Fair Value ​ ​ Units ​ (Per unit) ​ ​ ​ ​ ​ ​ Unvested RSUs at December 31, 2019 90,006 ​ $ 34.66 Granted 328,311 ​ ​ 31.92 Vested (51,722) ​ ​ 31.58 Forfeited (15,609) ​ ​ 32.46 Unvested RSUs at September 30, 2020 350,986 ​ $ 32.65

Leases (Tables)

Leases (Tables)	9 Months Ended
	Sep. 30, 2020
Leases
Schedule of operating lease liabilities maturities	The following table reconciles the undiscounted cash flows for the operating leases at September 30, 2020 to the operating lease liabilities recorded on the balance sheet (in thousands): ​ ​ ​ ​ ​ Years ending December 31, ​ ​ For the remainder of 2020 ​ $ 655 2021 ​ 2,647 2022 ​ ​ 2,269 2023 ​ ​ 1,415 2024 ​ ​ 1,436 2025 ​ ​ 1,330 Thereafter ​ ​ 1,238 Total undiscounted lease payments ​ ​ 10,990 Less: Imputed interest ​ ​ (1,454) Present value of lease payments ​ $ 9,536 ​ ​ ​ ​ Lease liabilities - short-term ​ $ 2,158 Lease liabilities - long-term ​ ​ 7,378 Total lease liabilities ​ $ 9,536
Summary of lease costs and cash disclosures	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Nine Months Ended ​ ​ September 30, ​ September 30, ​ ​ 2020 2019 ​ 2020 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating lease cost ​ $ 599 ​ $ 648 ​ $ 1,896 ​ $ 1,948 Variable lease cost ​ ​ 70 ​ ​ 11 ​ ​ 129 ​ ​ 67 Total lease costs ​ $ 669 ​ $ 659 ​ $ 2,025 ​ $ 2,015 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash paid for amounts included in ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ the measurement of lease liabilities ​ $ 527 ​ $ 531 ​ $ 1,650 ​ $ 1,385

Collaboration and Licensing A_2

Collaboration and Licensing Agreements (Tables)	9 Months Ended
	Sep. 30, 2020
Collaboration and Licensing Agreements
Schedule of revenue by licensees	The revenues recorded for the three and nine months ended September 30, 2020 were earned principally from the following licensees (in millions): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended Nine Months Ended ​ ​ September 30, September 30, ​ ​ 2020 ​ 2019 2020 ​ 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ Aimmune ​ $ — $ — ​ $ 9.6 ​ $ — Alexion ​ 4.3 ​ ​ 5.4 ​ ​ 11.5 ​ 10.5 Amgen ​ ​ — ​ ​ 5.0 ​ ​ — ​ ​ 5.0 Astellas ​ ​ — ​ ​ — ​ ​ 0.9 ​ ​ 13.8 Genentech ​ ​ 0.9 ​ ​ 0.7 ​ ​ 2.3 ​ ​ 113.2 Gilead ​ ​ — ​ ​ — ​ ​ 13.5 ​ ​ — MorphoSys ​ ​ 25.2 ​ ​ — ​ ​ 37.7 ​ ​ — Novartis ​ ​ — ​ 10.0 ​ ​ — ​ 10.0 Omeros ​ ​ 5.0 ​ ​ — ​ ​ 5.0 ​ ​ — Vir ​ ​ — ​ 0.7 ​ ​ 0.3 ​ 0.7 Total ​ $ 35.4 ​ $ 21.8 ​ $ 80.8 ​ $ 153.2
Schedule of disaggregation of revenue	The table below summarizes the disaggregation of revenue recorded for the three and nine months ended September 30, 2020 (in millions): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended Nine Months Ended ​ ​ September 30, September 30, ​ ​ 2020 ​ 2019 2020 ​ 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ Research collaboration $ 0.9 $ 0.6 ​ $ 3.2 $ 15.2 Milestone ​ ​ 25.0 ​ 19.3 ​ ​ 37.8 ​ 23.3 Licensing ​ ​ 5.0 ​ 0.5 ​ ​ 28.1 ​ 112.2 Royalties ​ ​ 4.5 ​ ​ 1.4 ​ ​ 11.7 ​ ​ 2.5 Total ​ $ 35.4 ​ $ 21.8 ​ $ 80.8 ​ $ 153.2

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Summary of Significant Accounting Policies
Impairment of intangible assets	$ 0	$ 0	$ 0	$ 0
Impairment loss or recoveries	$ 0	$ 0	$ 0	$ 0

Fair Value of Financial Instr_3

Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019	Sep. 30, 2019
Fair Value of Financial Instruments
Money Market Funds	$ 58,094	$ 50,312
Marketable Securities	519,456
Equity Securities with Readily Determinable Fair Value	5,382
Total Fair Value	559,350	583,005
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	34,512	32,009
Corporate Securities
Fair Value of Financial Instruments
Marketable Securities	231,762	281,751
Government Securities
Fair Value of Financial Instruments
Marketable Securities	287,694	269,245
Level 1
Fair Value of Financial Instruments
Equity Securities with Readily Determinable Fair Value	5,382
Total Fair Value	39,894	32,009
Level 1 | Money Market Funds
Fair Value of Financial Instruments
Money Market Funds	34,512	32,009
Level 2
Fair Value of Financial Instruments
Total Fair Value	519,456	550,996
Level 2 | Corporate Securities
Fair Value of Financial Instruments
Marketable Securities	231,762	281,751
Level 2 | Government Securities
Fair Value of Financial Instruments
Marketable Securities	$ 287,694	$ 269,245

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, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Numerator:
Net income (loss) attributable to common stockholders	$ (12,550)	$ (10,224)	$ (55,642)	$ 53,787
Denominator:
Weighted average common shares outstanding, basic	57,266,112	56,643,075	57,091,452	56,449,678
Effect of dilutive securities				1,915,480
Weighted average common shares outstanding, diluted	57,266,112	56,643,075	57,091,452	58,365,158
Basic net income (loss) (in dollars per share)	$ (0.22)	$ (0.18)	$ (0.97)	$ 0.95
Diluted net income (loss) (in dollars per share)	$ (0.22)	$ (0.18)	$ (0.97)	$ 0.92

Net Income (Loss) Per Share - A

Net Income (Loss) Per Share - Anti-dilutive securities (Details)	9 Months Ended
	Sep. 30, 2019shares
Net Income (Loss) Per Share
Securities excluded in calculation of EPS	998,186

Marketable Securities (Details)

Marketable Securities (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Schedule of Available-for-sale Securities
Cash and cash equivalents	$ 58,094	$ 50,312
Investments, amortized cost	553,391	581,834
Investments	553,968	583,005
Total amortized cost	518,879
Gross unrealized gains	581	1,201
Gross unrealized losses	(4)	(30)
Marketable Securities	519,456
Marketable securities
Schedule of Available-for-sale Securities
Marketable Securities	519,456	550,996
Money Market Funds
Schedule of Available-for-sale Securities
Cash and cash equivalents	34,512	32,009
Corporate Securities
Schedule of Available-for-sale Securities
Total amortized cost	231,385	281,586
Gross unrealized gains	377	195
Gross unrealized losses		(30)
Marketable Securities	231,762	281,751
Government Securities
Schedule of Available-for-sale Securities
Total amortized cost	287,494	268,239
Gross unrealized gains	204	1,006
Gross unrealized losses	(4)
Marketable Securities	287,694	269,245
Cash and Cash Equivalents
Schedule of Available-for-sale Securities
Cash and cash equivalents	$ 34,512	$ 32,009

Marketable Securities - Maturit

Marketable Securities - Maturities (Details) $ in Thousands	Sep. 30, 2020USD ($)
Amortized Cost
Maturing in one year or less	$ 487,108
Maturing within two years	31,771
Total amortized cost	518,879
Estimate Fair Value
Maturing in one year or less	487,688
Maturing within two years	31,768
Total estimated fair value	$ 519,456

Marketable Securities - Unreali

Marketable Securities - Unrealized losses (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2020	Dec. 31, 2019
Unrealized losses
Equity securities, net unrealized losses	$ 2,800	$ 794
Corporate Securities
Fair value
Fair value, less than 12 months			$ 46,303
Fair value, 12 months or greater			13,992
Unrealized losses
Unrealized losses, Less than 12 months			(24)
Unrealized losses, 12 months or greater			$ (6)
Government Securities
Fair value
Fair value, less than 12 months	25,344	25,344
Fair value, 12 months or greater	31,768	31,768
Unrealized losses
Unrealized losses, Less than 12 months	(1)	(1)
Unrealized losses, 12 months or greater	$ (3)	$ (3)

Stock Based Compensation (Detai

Stock Based Compensation (Details)	Dec. 02, 2013shares	Apr. 30, 2020installmentshares	Sep. 30, 2020itemshares	Sep. 30, 2019shares	Jan. 01, 2020shares
Employee stock options
Stock-based compensation
Options granted (in shares)			1,562,774	1,920,375
ESPP
Stock-based compensation
Total number of shares of common stock available for issuance			581,286
Awards issued under the plan (in shares)			445,621
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
Awards issued under the plan (in shares)			433,810
Granted		60,000	328,311
Annual installment vesting periods		2	3
Period of installment		6 months
Vesting period		1 year
The 2013 Plan
Stock-based compensation
Total number of shares of common stock available for issuance			11,955,629		1,138,046
Annual percentage increase in shares of common stock available for issuance			4.00%
Increase in shares of common stock available for issuance (in shares)			1,138,046
Options granted (in shares)			10,456,289
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, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Stock-based compensation
Total employee, director and non-employee stock-based compensation expense	$ 8,318	$ 9,514	$ 23,061	$ 24,673
Employee stock options
Stock-based compensation
Total employee, director and non-employee stock-based compensation expense	6,624	9,117	19,172	23,588
ESPP
Stock-based compensation
Total employee, director and non-employee stock-based compensation expense	209	217	616	630
Restricted stock units
Stock-based compensation
Total employee, director and non-employee stock-based compensation expense	1,485	180	3,273	455
General and administrative
Stock-based compensation
Total employee, director and non-employee stock-based compensation expense	2,881	2,474	7,975	6,337
Research and development
Stock-based compensation
Total employee, director and non-employee stock-based compensation expense	$ 5,437	$ 7,040	$ 15,086	$ 18,336

Stock-Based Compensation - Opti

Stock-Based Compensation - Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands	Dec. 02, 2013	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Employee stock options
Number of Shares subject to outstanding options
Balance at the beginning of the period (in shares)		7,174,319
Options granted (in shares)		1,562,774	1,920,375
Options forfeited (in shares)		(197,669)
Options exercised (in shares)		(392,570)
Balance at the end of the period (in shares)		8,146,854		7,174,319
Exercisable options (in shares)		4,796,471
Weighted Average Exercise Price (Per Share)
Balance at the beginning of the period (in dollars per share)		$ 24.03
Options granted (in dollars per share)		32.40
Options forfeited (in dollars per share)		31.90
Options exercised (in dollars per share)		19.69
Balance at the end of the period (in dollars per share)		25.66		$ 24.03
Exercisable (in dollars per share)		$ 20.90
Weighted-average remaining contractual life		7 years 1 month 17 days		7 years 3 months 25 days
Weighted-average remaining contractual life of awards exercisable		6 years
Aggregate intrinsic value of options outstanding		$ 107,624
Aggregate intrinsic value of options exercisable		$ 86,073
Closing price of common stock (in dollars per share)		$ 38.79
Weighted average fair value of options granted (in dollars per share)		$ 16.60	$ 20.71
The 2013 Plan
Number of Shares subject to outstanding options
Options granted (in shares)		10,456,289
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, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Employee stock options
Weighted average assumptions for estimated fair value of employee stock options
Expected volatility (as a percent)	56.20%	60.80%	54.50%	61.20%
Risk-free interest rate (as a percent)	0.35%	1.52%	0.80%	2.33%
Expected term (years)	6 years	6 years	6 years 1 month 6 days	6 years
Compensation expense
Unamortized compensation expense related to unvested options	$ 53.7		$ 53.7
Period to recognize unamortized compensation expense			2 years 7 months 6 days
ESPP
Weighted average assumptions for estimated fair value of employee stock options
Expected volatility, low end of range (as a percent)	50.80%	55.00%	50.80%	55.00%
Expected volatility, high end of range (as a percent)	62.60%	71.40%	62.60%	71.40%
Risk-free interest rate, low end of range (as a percent)	0.18%	1.47%	0.18%	1.47%
Risk-free interest rate, high end of range (as a percent)	1.65%	2.70%	1.65%	2.70%
Compensation expense
Unamortized compensation expense related to unvested options	$ 1.1		$ 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 - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended	9 Months Ended
	Apr. 30, 2020	Sep. 30, 2020
Stock-based compensation
Beginning balance		90,006
Granted	60,000	328,311
Vested		(51,722)
Forfeited		(15,609)
Ending balance		350,986
Weighted Average Grant Date Fair Value, Beginning Balance		$ 34.66
Weighted Average Grant Date Fair Value, Granted		31.92
Weighted Average Grant Date Fair Value, Vested		31.58
Weighted Average Grant Date Fair Value, Forfeited		32.46
Weighted Average Grant Date Fair Value, Ending Balance		$ 32.65
Compensation expense
Unamortized compensation expense related to unvested restricted stock units		$ 9,200
Period to recognize unamortized compensation expense		2 years 2 months 12 days

Leases (Details)

Leases (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Jul. 31, 2017
Lessee, Lease, Description [Line Items]
Option to extend	true
For the remainder of 2020	$ 655
2021	2,647
2022	2,269
2023	1,415
2024	1,436
2025	1,330
Thereafter	1,238
Total undiscounted lease payments	10,990
Less: Imputed interest	(1,454)
Present value of lease payments	$ 9,536
Monrovia, CA - office and laboratory space
Lessee, Lease, Description [Line Items]
Lease term	66 months
Monrovia, CA - office and laboratory space with additional space
Lessee, Lease, Description [Line Items]
Renewal term		5 years
San Diego, CA - office space
Lessee, Lease, Description [Line Items]
Renewal term	5 years
San Diego, CA - second office space
Lessee, Lease, Description [Line Items]
Renewal term	5 years

Leases - Operating lease liabil

Leases - Operating lease liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Leases
Lease liability - short-term	$ 2,158	$ 2,169
Lease liability - long-term	7,378	$ 8,565
Operating lease liabilities	$ 9,536

Leases - Lease costs (Details)

Leases - Lease costs (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Leases
Operating lease cost	$ 599	$ 648	$ 1,896	$ 1,948
Variable lease cost	70	11	129	67
Total lease costs	669	659	2,025	2,015
Cash paid for amounts included in the measurement of lease liabilities	527	$ 531	1,650	$ 1,385
ROU assets exchanged for lease liabilities	$ 300		$ 400
Remaining lease term	5 years 1 month 6 days		5 years 1 month 6 days
Discount rate	5.50%		5.50%

Commitments and Contingencies (

Commitments and Contingencies (Details) - University of Texas M.D. Anderson Cancer Center $ in Millions	9 Months Ended
	Sep. 30, 2020USD ($)
Loss Contingencies [Line Items]
Committed amount	$ 10
Agreement term	5 years

Collaboration and Licensing A_3

Collaboration and Licensing Agreements (Details)	Feb. 04, 2020USD ($)shares	Jan. 31, 2020USD ($)	Mar. 29, 2019USD ($)	Mar. 08, 2019USD ($)	Aug. 31, 2020USD ($)Option	Jul. 31, 2020USD ($)Program	Apr. 30, 2020USD ($)	Feb. 29, 2020USD ($)	Jan. 31, 2020USD ($)item	Jun. 30, 2019USD ($)	Feb. 28, 2019	Oct. 31, 2017USD ($)shares	Jun. 30, 2016USD ($)item	Sep. 30, 2015USD ($)	Jan. 31, 2013Program	Jun. 30, 2006item	Sep. 30, 2020USD ($)	Jun. 30, 2020item	Sep. 30, 2019USD ($)item	Sep. 30, 2020USD ($)itemOption	Sep. 30, 2019USD ($)	Dec. 31, 2019USD ($)	Mar. 31, 2019USD ($)
Collaboration research and licensing agreements
Deferred revenue																	$ 43,800,000		$ 48,200,000	$ 43,800,000	$ 48,200,000
Revenue recorded																	35,366,000		21,760,000	80,840,000	153,184,000
Current portion of deferred revenue																	43,840,000		45,600,000	43,840,000	45,600,000	$ 45,205,000
Non Current portion of deferred revenue																			2,600,000		2,600,000	$ 1,926,000
Licensing
Collaboration research and licensing agreements
Revenue recorded																	5,000,000		500,000	28,100,000	112,200,000
Royalty
Collaboration research and licensing agreements
Revenue recorded																	4,500,000		1,400,000	11,700,000	2,500,000
Milestone
Collaboration research and licensing agreements
Revenue recorded																	25,000,000		19,300,000	37,800,000	23,300,000
Genentech
Collaboration research and licensing agreements
Revenue recorded																	900,000		700,000	2,300,000	$ 113,200,000
Genentech | Maximum
Collaboration research and licensing agreements
Term of revenue recognized																					1 year
Astellas
Collaboration research and licensing agreements
Revenue recorded																				$ 900,000	$ 13,800,000
Novartis
Collaboration research and licensing agreements
Number of performance obligations																				2
Revenue recorded																			10,000,000		10,000,000
Amgen, Inc.
Collaboration research and licensing agreements
Revenue recorded																			5,000,000		5,000,000
MorphoSys
Collaboration research and licensing agreements
Revenue recorded																	25,200,000			$ 37,700,000
Alexion
Collaboration research and licensing agreements
Revenue recorded																	4,300,000		5,400,000	11,500,000	10,500,000
VIR Biotechnology
Collaboration research and licensing agreements
Revenue recorded																			700,000	300,000	700,000
Aimmune
Collaboration research and licensing agreements
Revenue recorded																				9,600,000
Gilead
Collaboration research and licensing agreements
Revenue recorded																				13,500,000
Omeros
Collaboration research and licensing agreements
Revenue recorded																	5,000,000			5,000,000
Atreca, Inc. | Collaboration and License Agreement
Collaboration research and licensing agreements
Research license term						3 years
Sharing percent of costs and profits						50.00%
Revenue recorded																	0			$ 0
University of Texas M.D. Anderson Cancer Center
Collaboration research and licensing agreements
Agreement term																				5 years
Committed amount																	10,000,000			$ 10,000,000
Collaboration and License Agreement | Genentech
Collaboration research and licensing agreements
Nonrefundable upfront payment				$ 120,000,000
Percentage of profits on net sales of the product				45.00%
Initial cost-sharing percentage				45.00%
Research license term											2 years
Revenue recognized																	900,000		700,000	2,300,000	113,200,000
Collaboration and License Agreement | Genentech | XmAb24306
Collaboration research and licensing agreements
Cost sharing receivable (payable)																	(1,200,000)			(1,200,000)
Collaboration and License Agreement | Genentech | Research service
Collaboration research and licensing agreements
Performance obligation																							$ 8,300,000
Revenue recognized																	900,000
Deferred revenue																	3,700,000			3,700,000
Collaboration and License Agreement | Genentech | Licensing
Collaboration research and licensing agreements
Performance obligation																							$ 111,700,000
Collaboration and License Agreement | Genentech | Maximum
Collaboration research and licensing agreements
Potential milestone payment				$ 160,000,000
Collaboration and License Agreement | Novartis
Collaboration research and licensing agreements
Nonrefundable upfront payment													$ 150,000,000
Revenue recognized																	0		10,000,000	0	10,000,000
Deferred revenue																	40,100,000			40,100,000
Cost sharing receivable (payable)																	1,100,000			$ 1,100,000
Collaboration and License Agreement | Novartis | Bispecific
Collaboration research and licensing agreements
Number of development stage products | item																2				1
Collaboration and License Agreement | Novartis | Discovery Program
Collaboration research and licensing agreements
Number of performance obligations | item																				2
Collaboration and License Agreement | Novartis | Bispecific FC Technologies
Collaboration research and licensing agreements
Number of development stage products | item													2
Collaboration and License Agreement | Novartis | Bispecific FC Technologies | Maximum
Collaboration research and licensing agreements
Number of antibody targets for which bispecific technology applied | item													4
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
Collaboration and License Agreement | MorphoSys
Collaboration research and licensing agreements
Revenue recognized						$ 25,000,000											25,000,000		0	$ 37,500,000	0
Deferred revenue																	0			0
Collaboration and License Agreement | MorphoSys | Royalty
Collaboration research and licensing agreements
Revenue recognized																	200,000			200,000
Collaboration and License Agreement | MorphoSys | Milestone
Collaboration research and licensing agreements
Revenue recognized								$ 12,500,000
Collaboration and License Agreement | Atreca, Inc.
Collaboration research and licensing agreements
Cost sharing receivable (payable)																	(100,000)			(100,000)
Number of programs | Program						1
Number of different target programs | Program						2
Research and License Agreement | Genentech | Research service
Collaboration research and licensing agreements
Revenue recognized																				2,300,000
Research and License Agreement | Astellas
Collaboration research and licensing agreements
Nonrefundable upfront payment			$ 15,000,000
Potential milestone payment			240,000,000
Revenue recognized																	0		0	900,000	13,800,000
Deferred revenue																	0			0
Research and License Agreement | Astellas | Bispecific
Collaboration research and licensing agreements
Revenue recognized										$ 13,600,000
Research and License Agreement | Astellas | Research service
Collaboration research and licensing agreements
Performance obligation			1,400,000
Research and License Agreement | Amgen, Inc.
Collaboration research and licensing agreements
Upfront and milestone payment														$ 60,500,000
Potential milestone payment														$ 255,000,000
Revenue recognized																	0		5,000,000	0	5,000,000
Deferred revenue																	0			0
Research and License Agreement | VIR Biotechnology
Collaboration research and licensing agreements
Potential milestone payment																			$ 155,250,000		155,250,000
Revenue recognized																	0			300,000	700,000
Deferred revenue																	0			0
Number of different target programs | item																			2
Option and License Agreement | Alexion
Collaboration research and licensing agreements
Proceeds from milestone payments																			$ 4,000,000
Revenue recognized																				11,500,000	10,500,000
Deferred revenue																	0			0
Cost sharing receivable (payable)																	8,100,000			8,100,000
Number of different target programs | Program															1
Option and License Agreement | Alexion | Royalty
Collaboration research and licensing agreements
Revenue recognized																	4,300,000		1,400,000
License Agreement | INmune
Collaboration research and licensing agreements
Nonrefundable upfront payment												$ 100,000
Revenue recognized																	0		0	0	0
Shares received in noncash transaction | shares												1,585,000
Value of share options in noncash transaction												$ 10,000,000
Deferred revenue																	0			0
Option term												6 years
Carrying value																	0		0	0	0
License Agreement | INmune | Maximum
Collaboration research and licensing agreements
Additional equity interests (as a percentage)												10.00%
License Agreement | Gilead
Collaboration research and licensing agreements
Performance obligation		$ 13,500,000							$ 13,500,000
Nonrefundable upfront payment									6,000,000
Potential milestone payment		67,000,000							$ 67,000,000
Revenue recognized							$ 7,500,000													13,500,000
Deferred revenue																	0			$ 0
Options exercised																		3		3
Number of compounds | item									3
Number of commercial licenses | item																				4
Option fee		7,500,000					$ 7,500,000
License Agreement | Gilead | Cytotoxic Fc and Xtend Fc Technologies
Collaboration research and licensing agreements
Performance obligation		3,500,000							$ 3,500,000
License Agreement | Gilead | Initial Option Exercises
Collaboration research and licensing agreements
Performance obligation		2,500,000							2,500,000
License, Development, and Commercialization Agreement | Aimmune
Collaboration research and licensing agreements
Performance obligation	$ 9,600,000
Nonrefundable upfront payment	5,000,000
Potential milestone payment	$ 385,000,000
Revenue recognized																	0			$ 9,600,000
Shares received in noncash transaction | shares	156,238
Value of share options in noncash transaction	$ 4,600,000
Deferred revenue																	0			0
Technology License Agreement | Omeros
Collaboration research and licensing agreements
Performance obligation					$ 5,000,000
Nonrefundable upfront payment					$ 5,000,000
Deferred revenue																	0			0
Number of commercial options | Option					4
Number of additional antibodies					$ 3
Number of commercial licenses | Option					4
Revenue recorded																	$ 5,000,000			$ 5,000,000
Technology License Agreement | Omeros | Maximum
Collaboration research and licensing agreements
Potential milestone payment					$ 65,000,000
Technology License Agreement | Omeros | Initial Option Exercises
Collaboration research and licensing agreements
Performance obligation					3,000,000
Technology License Agreement | Omeros | Xtend Fc Technology
Collaboration research and licensing agreements
Performance obligation					$ 2,000,000
Strategic Collaboration Agreement | University of Texas M.D. Anderson Cancer Center
Collaboration research and licensing agreements
Agreement term					5 years
Amount of expenses incurred					$ 0
Committed amount					10,000,000
Agreed amount of annual fund amount					2,000,000
Development-based | Research and License Agreement | Astellas
Collaboration research and licensing agreements
Potential milestone payment			32,500,000
Development-based | Research and License Agreement | VIR Biotechnology
Collaboration research and licensing agreements
Potential milestone payment																			5,250,000		5,250,000
Development-based | License Agreement | Gilead
Collaboration research and licensing agreements
Potential milestone payment		10,000,000							10,000,000
Development-based | License, Development, and Commercialization Agreement | Aimmune
Collaboration research and licensing agreements
Potential milestone payment	22,000,000
Development-based | Technology License Agreement | Omeros
Collaboration research and licensing agreements
Potential milestone payment					15,000,000
Regulatory-based | Research and License Agreement | Astellas
Collaboration research and licensing agreements
Potential milestone payment			57,500,000
Regulatory-based | Research and License Agreement | VIR Biotechnology
Collaboration research and licensing agreements
Potential milestone payment																			30,000,000		30,000,000
Regulatory-based | License Agreement | Gilead
Collaboration research and licensing agreements
Potential milestone payment		27,000,000							27,000,000
Regulatory-based | License, Development, and Commercialization Agreement | Aimmune
Collaboration research and licensing agreements
Potential milestone payment	53,000,000
Regulatory-based | Technology License Agreement | Omeros
Collaboration research and licensing agreements
Potential milestone payment					25,000,000
Sales-based | Research and License Agreement | Astellas
Collaboration research and licensing agreements
Potential milestone payment			$ 150,000,000
Sales-based | Research and License Agreement | VIR Biotechnology
Collaboration research and licensing agreements
Potential milestone payment																			$ 120,000,000		$ 120,000,000
Sales-based | License Agreement | Gilead
Collaboration research and licensing agreements
Potential milestone payment		$ 30,000,000							$ 30,000,000
Sales-based | License, Development, and Commercialization Agreement | Aimmune
Collaboration research and licensing agreements
Potential milestone payment	$ 310,000,000
Sales-based | Technology License Agreement | Omeros
Collaboration research and licensing agreements
Potential milestone payment					$ 25,000,000

Collaborative and Licensing Agr

Collaborative and Licensing Agreements - Revenue Recognition (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Revenue recorded	$ 35,366,000	$ 21,760,000	$ 80,840,000	$ 153,184,000
Deferred revenue	43,800,000	48,200,000	43,800,000	48,200,000
Current portion of deferred revenue	43,840,000	45,600,000	43,840,000	45,600,000	$ 45,205,000
Non Current portion of deferred revenue		2,600,000		2,600,000	$ 1,926,000
Research collaboration
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Revenue recorded	900,000	600,000	3,200,000	15,200,000
Milestone
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Revenue recorded	25,000,000	19,300,000	37,800,000	23,300,000
Licensing
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Revenue recorded	5,000,000	500,000	28,100,000	112,200,000
Royalty
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Revenue recorded	4,500,000	1,400,000	11,700,000	2,500,000
Aimmune
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Revenue recorded			9,600,000
Amgen, Inc.
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Revenue recorded		5,000,000		5,000,000
Alexion
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Revenue recorded	4,300,000	5,400,000	11,500,000	10,500,000
Astellas
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Revenue recorded			900,000	13,800,000
Genentech
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Revenue recorded	900,000	700,000	2,300,000	113,200,000
Gilead
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Revenue recorded			13,500,000
MorphoSys
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Revenue recorded	25,200,000		37,700,000
VIR Biotechnology
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Revenue recorded		700,000	$ 300,000	700,000
Novartis
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Number of performance obligations			2
Revenue recorded		$ 10,000,000		$ 10,000,000
Omeros
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Revenue recorded	5,000,000		$ 5,000,000
Collaboration and License Agreement | MorphoSys
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Deferred revenue	0		0
Collaboration and License Agreement | Novartis
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Deferred revenue	$ 40,100,000		$ 40,100,000
Maximum | Genentech
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Term of revenue recognized				1 year

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Reconciliation of federal statutory income tax to effective income tax
Income tax expense		$ (350)		$ 600
Federal
Reconciliation of federal statutory income tax to effective income tax
Income tax receivable					$ 800
Tax refund received	$ 800		$ 800

Subsequent Events (Details)

Subsequent Events (Details) - Aimmune - Subsequent Event $ in Millions	1 Months Ended
	Oct. 31, 2020USD ($)shares
Collaboration research and licensing agreements
Proceeds from sale of equity securities | $	$ 5.4
Shares liquidated | shares	156,238