Vanda Pharmaceuticals (VNDA) 10-Q7 May 152015 Q1 Quarterly reportFinancial data

Company Profile

Document_and_Entity_Informatio

Document and Entity Information	3 Months Ended
Document and Entity Information	Mar. 31, 2015	Apr. 30, 2015
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	FALSE
Document Period End Date	31-Mar-15
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q1
Trading Symbol	VNDA
Entity Registrant Name	Vanda Pharmaceuticals Inc.
Entity Central Index Key	1347178
Current Fiscal Year End Date	-19
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		41,798,503

CONDENSED_CONSOLIDATED_BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (USD $)	Mar. 31, 2015	Dec. 31, 2014
In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Current assets:
Cash and cash equivalents	$32,809	$60,901
Marketable securities	101,520	68,921
Accounts receivable, net	20,120	3,654
Inventory	5,215	5,170
Prepaid expenses and other current assets	2,503	3,084
Total current assets	162,167	141,730
Property and equipment, net	3,080	2,437
Intangible assets, net	47,580	26,724
Restricted cash and other	813	813
Total assets	213,640	171,704
Current liabilities:
Accounts payable	1,490	835
Accrued and other current liabilities	30,299	6,951
Total current liabilities	31,789	7,786
Milestone obligation under license agreement	25,000
Other non-current liabilities	4,378	3,101
Total liabilities	61,167	10,887
Commitments and contingencies (Notes 13 and 14)
Stockholders' equity:
Preferred stock, $0.001 par value; 20,000,000 shares authorized, and no shares issued or outstanding
Common stock, $0.001 par value; 150,000,000 shares authorized; 41,793,422 and 41,486,361 shares issued and outstanding at March 31, 2015 and December 31, 2014, respectively	42	41
Additional paid-in capital	450,609	448,744
Accumulated other comprehensive income	27	16
Accumulated deficit	-298,205	-287,984
Total stockholders' equity	152,473	160,817
Total liabilities and stockholders' equity	$213,640	$171,704

CONDENSED_CONSOLIDATED_BALANCE1

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)	Mar. 31, 2015	Dec. 31, 2014
Preferred stock, par value	$0.00	$0.00
Preferred stock, shares authorized	20,000,000	20,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$0.00	$0.00
Common stock, shares authorized	150,000,000	150,000,000
Common stock, shares issued	41,793,422	41,486,361
Common stock, shares outstanding	41,793,422	41,486,361

CONDENSED_CONSOLIDATED_STATEME

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $)	3 Months Ended
In Thousands, except Share data, unless otherwise specified	Mar. 31, 2015	Mar. 31, 2014
Revenues:
Product sales, net	$22,150
Royalty revenue		1,691
Licensing revenue		7,452
Total revenues	22,150	9,143
Operating expenses:
Cost of goods sold	5,015
Research and development	4,478	7,263
Selling, general and administrative	18,806	27,893
Intangible asset amortization	4,144	565
Total operating expenses	32,443	35,721
Loss from operations	-10,293	-26,578
Other income	72	45
Net loss	($10,221)	($26,533)
Basic and diluted net loss per share	($0.24)	($0.79)
Weighted average shares outstanding, basic and diluted	41,744,948	33,678,706

CONDENSED_CONSOLIDATED_STATEME1

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (USD $)	3 Months Ended
In Thousands, unless otherwise specified	Mar. 31, 2015	Mar. 31, 2014
Net loss	($10,221)	($26,533)
Other comprehensive income (loss):
Change in net unrealized income (loss) on marketable securities	11	-13
Tax provision on other comprehensive income (loss)	0	0
Other comprehensive income (loss), net of tax:	11	-13
Comprehensive loss	($10,210)	($26,546)

CONDENSED_CONSOLIDATED_STATEME2

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (USD $)	Total	Common Stock	Additional Paid-in Capital	Other Comprehensive Income	Accumulated Deficit
In Thousands, except Share data	Total	Common Stock	Additional Paid-in Capital	Other Comprehensive Income	Accumulated Deficit
Beginning balance at Dec. 31, 2014	$160,817	$41	$448,744	$16	($287,984)
Beginning balance (in shares) at Dec. 31, 2014		41,486,361
Issuance of common stock from the exercise of stock options and settlement of restricted stock units (in shares)		332,383
Issuance of common stock from the exercise of stock options and settlement of restricted stock units	203	1	202
Shares withheld upon settlement of equity awards(in shares)		-25,322
Shares withheld upon settlement of equity awards	-282		-282
Employee and non-employee stock based compensation expense	1,945		1,945
Net income (loss)	-10,221				-10,221
Other comprehensive income, net of tax	11			11
Ending balance at Mar. 31, 2015	$152,473	$42	$450,609	$27	($298,205)
Ending balance (in shares) at Mar. 31, 2015		41,793,422

CONDENSED_CONSOLIDATED_STATEME3

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	3 Months Ended
In Thousands, unless otherwise specified	Mar. 31, 2015	Mar. 31, 2014
Cash flows from operating activities
Net loss	($10,221)	($26,533)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization of property and equipment	140	125
Employee and non-employee stock-based compensation	1,945	1,393
Amortization of discounts and premiums on marketable securities	197	53
Intangible asset amortization	4,144	565
Changes in assets and liabilities:
Accounts receivable	-16,466	340
Prepaid expenses and other current assets	581	-429
Inventory	-45	-192
Accounts payable	654	292
Accrued liabilities	24,387	7,934
Deferred revenue	239	-7,452
Net cash provided by (used in) operating activities	5,555	-23,904
Cash flows from investing activities
Acquisition of intangible assets		-8,000
Purchases of property and equipment	-783	-135
Purchases of marketable securities	-59,890	-2,319
Proceeds from sale of marketable securities		7,198
Maturities of marketable securities	27,105	3,500
Change in restricted cash		145
Net cash provided by (used in) investing activities	-33,568	389
Cash flows from financing activities
Obligations paid in connection with settlement of equity awards	-282	-436
Proceeds from exercise of employee stock options	203	2,447
Net cash provided by (used in) financing activities	-79	2,011
Net decrease in cash and cash equivalents	-28,092	-21,504
Cash and cash equivalents
Beginning of period	60,901	64,764
End of period	32,809	43,260
Non-cash investing activities
Acquisition of intangible asset included in liabilities	$25,000

Business_Organization_and_Pres

Business Organization and Presentation	3 Months Ended
	Mar. 31, 2015
Business Organization and Presentation	1. Business Organization and Presentation
	Business Organization
	Vanda Pharmaceuticals Inc. (Vanda or the Company) is a biopharmaceutical company focused on the development and commercialization of products for the treatment of central nervous system disorders. Vanda commenced its operations in 2003 and the Company’s portfolio includes the following products:

		•	HETLIOZ® (tasimelteon), a product for the treatment of Non-24-Hour Sleep-Wake Disorder (Non-24) for which a New Drug Application (NDA) was approved by the U.S. Food and Drug Administration (FDA) in January 2014 and launched commercially in the U.S. in April 2014. In April 2015, the European Medicines Agency’s (EMA) Committee for Medicinal Products for Human Use (CHMP) adopted a positive opinion recommending approval of HETLIOZ® for the treatment of Non-24 in totally blind adults in the European Union (EU). The CHMP positive opinion will be reviewed by the European Commission (EC). If approved, the EC grants a centralized marketing authorization with unified labeling that is valid in the 28 countries that are members of the EU, as well as European Economic Area members Iceland, Liechtenstein and Norway. The EC final decision is expected mid-year 2015. HETLIOZ® has potential utility in a number of circadian rhythm disorders. Ongoing HETLIOZ® life cycle management activities include an observation study in Smith-Magenis Syndrome (SMS) and a clinical development plan is being develop for pediatric Non-24. In addition, the Company is evaluating the use of HETLIOZ® in other circadian rhythm indications and exploring the creation of a new liquid formulation of HETLIOZ®.

		•	Fanapt® (iloperidone), a product for the treatment of schizophrenia, the oral formulation of which was being marketed and sold in the U.S. by Novartis Pharma AG (Novartis) until December 31, 2014. On December 31, 2014, Novartis transferred all the U.S. and Canadian commercial rights to the Fanapt® franchise to the Company. See Note 3, Settlement Agreement with Novartis, for further information. Additionally, the Company’s distribution partners launched Fanapt® in Israel and Mexico in 2014.

		•	Tradipitant (VLY-686), a small molecule neurokinin-1 receptor (NK-1R) antagonist, which is presently in clinical development for the treatment of chronic pruritus in atopic dermatitis. Results from a Phase II study for the treatment of chronic pruritus in atopic dermatitis were announced in March 2015. Clinical evaluation is ongoing to assess potential future development activities.

		•	Trichostatin A, a small molecule histone deacetylase (HDAC) inhibitor.

		•	AQW051, a Phase II alpha-7 nicotinic acetylcholine receptor partial agonist.
	Basis of Presentation
	The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with the Company’s consolidated financial statements for the fiscal year ended December 31, 2014 included in the Company’s annual report on Form 10-K. The financial information as of March 31, 2015 and for the three months ended March 31, 2015 and 2014 is unaudited, but in the opinion of management, all adjustments, consisting only of normal recurring accruals, considered necessary for a fair statement of the results for these interim periods have been included. The condensed consolidated balance sheet data as of December 31, 2014 was derived from audited financial statements but does not include all disclosures required by GAAP.

	The results of the Company’s operations for any interim period are not necessarily indicative of the results that may be expected for any other interim period or for a full fiscal year. The financial information included herein should be read in conjunction with the consolidated financial statements and notes in the Company’s annual report on Form 10-K for the fiscal year ended December 31, 2014.

Summary_of_Significant_Account

Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2015
Summary of Significant Accounting Policies	2. Summary of Significant Accounting Policies
	Use of Estimates
	The preparation of financial statements in conformity with GAAP requires management to make estimates that affect the reported amounts of assets and liabilities at the date of the financial statements, disclosure of contingent assets and liabilities, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
	Inventory
	Inventory, which is recorded at the lower of cost or market, includes the cost of third-party manufacturing and other direct and indirect costs and is valued using the first-in, first-out method. The Company capitalizes inventory costs associated with its products upon regulatory approval when, based on management’s judgment, future commercialization is considered probable and the future economic benefit is expected to be realized; otherwise, such costs are expensed as research and development. Inventory is evaluated for impairment by consideration of factors such as lower of cost or market, net realizable value, obsolescence or expiry.
	Net Product Sales
	The Company’s net product sales consist of sales of HETLIOZ® and, beginning in 2015, sales of Fanapt®. Net sales by product for the three months ended March 31, 2015 and 2014 were as follows:


		Three Months Ended
		March 31,		March 31,
	(in thousands)	2015		2014
	HETLIOZ® product sales, net	$	7,460	$	—
	Fanapt® product sales, net		14,690		—

		$	22,150	$	—

	The Company applies the revenue recognition guidance in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Subtopic 605-15, Revenue Recognition—Products. The Company recognizes revenue from product sales when there is persuasive evidence that an arrangement exists, title to product and associated risk of loss has passed to the customer, the price is fixed or determinable, collectability is reasonably assured and the Company has no further performance obligations.
	HETLIOZ® is only available in the U.S. for distribution through a limited number of specialty pharmacies, and is not available in retail pharmacies. Fanapt® is available in the U.S. for distribution through a limited number of wholesalers and is available in retail pharmacies. The Company invoices and records revenue when its customers, specialty pharmacies and wholesalers, receive product from the third-party logistics warehouse. Revenues and accounts receivable are concentrated with these customers. The top six customers represented 95% of total revenues for the three months ended March 31, 2015, and the top three customers represented 80% of accounts receivable at March 31, 2015. The Company has not experienced any losses relating to receivables from customers.
	The Company has entered into distribution agreements with Probiomed S.A. de C.V. (Probiomed) for the commercialization of Fanapt® in Mexico and Megapharm Ltd. for the commercialization of Fanapt® in Israel. With the exception of sales to Probiomed, the Company invoices and records revenue upon delivery of Fanapt® to the distribution partner. The Probiomed distribution agreement contains a contracted delivery price plus a revenue sharing provision based on Probiomed’s sales of Fanapt®. As a result, the selling price of Fanapt® is not fixed or determinable upon delivery of Fanapt® to Probiomed. The Company defers revenue recognition until the revenue sharing provision is calculated. As of March 31, 2015, the Company recorded $0.4 million of deferred revenue related to Fanapt® sales.
	Product Sales Discounts and Allowances
	The Company’s product sales are recorded net of applicable discounts, chargebacks, rebates, co-pay assistance, service fees and product returns that are applicable for various government and commercial payors. Reserves established for discounts and returns are classified as reductions of accounts receivable if the amount is payable to direct customers, with the exception of service fees. Service fees are classified as a liability. Reserves established for chargebacks, rebates or co-pay assistance are classified as a liability if the amount is payable to a party other than customers. The Company currently records sales allowances for the following:
	Rebates: Allowances for rebates include mandated and supplemental discounts under the Medicaid Drug Rebate Program as well as contracted rebate programs with other payors. Rebate amounts owed after the final dispensing of the product to a benefit plan participant are based upon contractual agreements or legal requirements with public sector benefit providers, such as Medicaid. The allowance for rebates is based on statutory or contracted discount rates and expected utilization. Estimates for the expected utilization of rebates are based on historical activity and, where available, actual and pending prescriptions for which the Company has validated the insurance benefits. Rebates are generally invoiced and paid in arrears, such that the accrual balance consists of an estimate of the amount expected to be incurred for the current quarter’s activity, plus an accrual balance for known prior quarter’s unpaid rebates. If actual future invoicing varies from estimates, the Company may need to adjust accruals, which would affect net revenue in the period of adjustment.
	Chargebacks: Chargebacks are discounts that occur when contracted customers purchase directly from specialty pharmacies and wholesalers. Contracted customers, which currently consist primarily of Public Health Service institutions, non-profit clinics, and Federal government entities purchasing via the Federal Supply Schedule, generally purchase the product at a discounted price. The specialty pharmacy or wholesaler, in turn, charges back the difference between the price initially paid by the specialty pharmacy or wholesaler and the discounted price paid to the specialty pharmacy or wholesaler by the contracted customer. The allowance for chargebacks is based on historical activity and, where available, actual and pending prescriptions for which the Company has validated the insurance benefits.
	Medicare Part D Coverage Gap: Medicare Part D prescription drug benefit mandates manufacturers to fund approximately 50% of the Medicare Part D insurance coverage gap for prescription drugs sold to eligible patients. Estimates for expected Medicare Part D coverage gap are based in part on historical activity and, where available, actual and pending prescriptions for which the Company has validated the insurance benefits. Funding of the coverage gap is generally invoiced and paid in arrears so that the accrual balance consists of an estimate of the amount expected to be incurred for the current quarter’s activity, plus an accrual balance for known prior quarter activity. If actual future funding varies from estimates, the Company may need to adjust accruals, which would affect net revenue in the period of adjustment.
	Service Fees: The Company also incurs specialty pharmacy and wholesaler fees for services and their data. These fees are based on contracted terms and are known amounts. The Company accrues service fees at the time of revenue recognition, resulting in a reduction of product sales and the recognition of an accrued liability, unless it receives an identifiable and separate benefit for the consideration and it can reasonably estimate the fair value of the benefit received. In which case, service fees are recorded as selling, general and administrative expense.
	Co-payment Assistance: Patients who have commercial insurance and meet certain eligibility requirements may receive co-payment assistance. Co-pay assistance utilization is based on information provided by the Company’s third-party administrator. The allowance for co-pay assistance is based on actual sales and an estimate for pending sales based on either historical activity or pending sales for which the Company has validated the insurance benefits.
	Prompt-pay: Specialty pharmacies and wholesalers are offered discounts for prompt payment. The Company expects that the specialty pharmacies and wholesalers will earn prompt payment discounts and, therefore, deducts the full amount of these discounts from total product sales when revenues are recognized.

	Product Returns: Consistent with industry practice, the Company generally offers direct customers a limited right to return as defined within the Company’s returns policy. The Company considers several factors in the estimation process, including historical return activity, expiration dates of product shipped to specialty pharmacies, inventory levels within the distribution channel, product shelf life, prescription trends and other relevant factors.
	Stock-based Compensation
	Compensation costs for all stock-based awards to employees and directors are measured based on the grant date fair value of those awards and recognized over the period during which the employee or director is required to perform service in exchange for the award. The Company generally recognizes the expense over the award’s vesting period. The fair value of restricted stock units (RSUs) awarded is also amortized using the straight line method. Stock-based compensation expense recognized in the consolidated statements of operations is based on awards ultimately expected to vest. Therefore, it has been reduced for estimated forfeitures. Forfeitures are required to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.
	Advertising Expense
	The Company expenses the costs of advertising, including branded promotional expenses, as incurred. Branded advertising expenses, recorded in selling, general and administrative expenses, were $1.0 million and $0.9 million for the three months ended March 31, 2015 and 2014, respectively.
	Segment Reporting
	The Company operates in one reporting segment and, accordingly, no segment disclosures are presented herein.
	Recent accounting pronouncements
	In January 2015, the Financial Accounting Standards board (FASB) issued Accounting Standards Update (ASU) 2015-01, Income Statement-Extraordinary and Unusual Items, to simplify income statement classification by removing the concept of extraordinary items from U.S. GAAP. As a result, items that are both unusual and infrequent will no longer be separately reported net of tax after continuing operations. The new standard is effective for both public and private companies for periods beginning after December 15, 2015. Adoption of this new standard is not expected to have a material impact on the Company’s consolidated financial statements.
	In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements – Going Concern. The new standard requires management of public and private companies to evaluate whether there is substantial doubt about the entity’s ability to continue as a going concern and, if so, disclose that fact. Management will also be required to evaluate and disclose whether its plans alleviate that doubt. The new standard is effective for annual periods ending after December 15, 2016, and interim periods within annual periods beginning after December 15, 2016. Adoption of this new standard is not expected to have a material impact on the Company’s consolidated financial statements.
	In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). This new standards requires companies to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which a company expects to be entitled in exchange for those goods or services. Under the new standard, revenue is recognized when a customer obtains control of a good or service. The standard allows for two transition methods - entities can either apply the new standard (i) retrospectively to each prior reporting period presented, or (ii) retrospectively with the cumulative effect of initially applying the standard recognized at the date of initial adoption. The new standard is effective for public companies for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. Early adoption of the standard is prohibited. The Company is evaluating this standard to determine if adoption will have a material impact on the Company’s consolidated financial statements.

Settlement_Agreement_with_Nova

Settlement Agreement with Novartis	3 Months Ended
Settlement Agreement with Novartis	Mar. 31, 2015
Settlement Agreement with Novartis	3. Settlement Agreement with Novartis
	In May 2014, the Company commenced arbitration proceedings with Novartis relating to the license of Fanapt® (the Fanapt® Arbitration). In December 2014, the Company entered into a settlement agreement with Novartis and certain of its affiliates (the Settlement Agreement). Pursuant to the terms of the Settlement Agreement, the Company and Novartis dismissed the Fanapt® Arbitration and released each other from any related claims. In addition, in connection with the Settlement Agreement, Novartis (i) transferred all U.S. and Canadian rights in the Fanapt® franchise to the Company, (ii) purchased $25.0 million of the Company’s common stock at a price per share equal to $13.82, and (iii) granted to the Company an exclusive worldwide license to AQW051, a Phase II alpha-7 nicotinic acetylcholine receptor partial agonist.
	Pursuant to the stock purchase agreement entered into as part of the Settlement Agreement, Novartis purchased $25.0 million of the Company’s common stock. The Company issued to Novartis an aggregate of 1,808,973 shares at $13.82 per share, which per share represented a 10% premium to the average closing prices of the Company’s common stock for the ten trading days prior to December 22, 2014. The Company recorded a loss of $0.9 million as part of gain on arbitration settlement in the consolidated statement of operations for the period ending December 31, 2014 related to the issuance of stock, which was valued using the Company’s closing stock price on December 31, 2014, the effective date of the transaction.
	In connection with the Settlement Agreement, the Company received an exclusive worldwide license under certain patents and patent applications, and other licenses to intellectual property, to develop and commercialize AQW051. Under the AQW051 license agreement, the Company is obligated to use its commercially reasonable efforts to develop and commercialize AQW051 and is responsible for all development costs under the AQW051 license agreement. Novartis is eligible to receive tiered-royalties on net sales at percentage rates up to the mid-teens. The Company evaluated AQW051 and determined that the asset is both incomplete and has substance. However, given the early stage of AQW051 and the future costs of development, no transaction value was allocated to this asset.
	The Company accounted for the Settlement Agreement in accordance with the provisions of ASC Subtopic 805, Business Combinations (ASC 805). Under the provisions of ASC 805, the acquisition date for a business is the date on which the company obtains control of the acquiree. The Company obtained control on December 31, 2014, the effective date of the Settlement Agreement. The following summarizes the fair value of consideration exchanged as part of the Settlement Agreement:


	(in thousands)
	Equity issued	$	25,904
	Cash received		(25,000	)
	Settlement of pre-existing non-contractual relationship		18,087

		$	18,991

	Assets acquired and recorded at fair value as of December 31, 2014 were as follows:


	(in thousands)
	Inventory	$	2,960
	Intangible - Re-acquired right		15,940
	Prepaid services		91

		$	18,991

	The Company recorded the reacquired right as an intangible asset as of December 31, 2014. The Company is amortizing the reacquired right on a straight-line basis through November 2016.
	Due to the effective date of the Settlement Agreement being December 31, 2014, the Company did not recognize any revenue or operating expenses related to U.S. or Canadian commercial sales of Fanapt® in the consolidated statement of operations for the year ended December 31, 2014.
	In connection with the Settlement Agreement, the Company and Novartis terminated the 2009 Amended Sublicense Agreement (the 2009 Agreement). Given the termination of this pre-existing contractual relationship and that there is no further obligation under the 2009 Agreement, the Company recognized a gain of $59.5 million, representing the remaining deferred revenue related to the $200.0 million upfront payment received from Novartis under the 2009 Agreement. This amount was included in gain on arbitration settlement in the consolidated statement of operations in the fourth quarter of 2014.

	The Settlement Agreement provided for a mutual release of claims and dismissed the Fanapt® Arbitration, which effectively settled a pre-existing non-contractual relationship. As a result, the Company recorded an $18.1 million gain on the settlement of arbitration, which represented the value of a potential future arbitration outcome. This amount was valued based on a probability weighted scenario analysis that took into consideration the probability of each potential future alternative outcomes of the arbitration between the parties. This amount is included in gain on arbitration settlement in the consolidated statement of operations in the fourth quarter of 2014.

Earnings_per_Share

Earnings per Share	3 Months Ended
Earnings per Share	Mar. 31, 2015
Earnings per Share	4. Earnings per Share
	Basic earnings per share (EPS) is calculated by dividing the net loss by the weighted average number of shares of common stock outstanding. Diluted EPS is computed by dividing the net loss by the weighted average number of shares of common stock outstanding, plus potential outstanding common stock for the period. Potential outstanding common stock includes stock options and shares underlying RSUs, but only to the extent that their inclusion is dilutive.
	The following table presents the calculation of basic and diluted net loss per share of common stock for the three months ended March 31, 2015 and 2014:


		Three Months Ended
	(in thousands, except for share and per share amounts)	March 31,			March 31,
	(in thousands, except for share and per share amounts)	2015			2014
	Numerator:
	Net loss	$	(10,221	)	$	(26,533	)

	Denominator:
	Weighted average shares outstanding, basic and diluted		41,744,948			33,678,706

	Net loss per share, basic and diluted:
	Net loss per share	$	(0.24	)	$	(0.79	)

	Antidilutive securities excluded from calculations of diluted net loss per share		5,656,662			3,870,508

	The Company incurred net losses for the three months ended March 31, 2015 and 2014 causing inclusion of any potentially dilutive securities to have an anti-dilutive effect, resulting in dilutive loss per share and basic loss per share attributable to common stockholders being equivalent.

Marketable_Securities

Marketable Securities	3 Months Ended
Marketable Securities	Mar. 31, 2015
Marketable Securities	5. Marketable Securities
	The following is a summary of the Company’s available-for-sale marketable securities as of March 31, 2015, which all have contract maturities of less than one year:


	March 31, 2015	Amortized		Gross		Gross			Fair
	March 31, 2015	Amortized		Unrealized		Unrealized			Market
	(in thousands)	Cost		Gains		Losses			Value
	U.S. Treasury and government agencies	$	47,992	$	7	$	(3	)	$	47,996
	Corporate debt		53,501		28		(5	)		53,524

		$	101,493	$	35	$	(8	)	$	101,520


	The following is a summary of the Company’s available-for-sale marketable securities as of December 31, 2014:


	December 31, 2014	Amortized		Gross		Gross			Fair
	December 31, 2014	Amortized		Unrealized		Unrealized			Market
	(in thousands)	Cost		Gains		Losses			Value
	U.S. Treasury and government agencies	$	30,618	$	4	$	(4	)	$	30,618
	Corporate debt		38,287		25		(9	)		38,303

		$	68,905	$	29	$	(13	)	$	68,921

Fair_Value_Measurements

Fair Value Measurements

3 Months Ended

Mar. 31, 2015

Fair Value Measurements

6. Fair Value Measurements

Authoritative guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include:

•

Level 1 — defined as observable inputs such as quoted prices in active markets

•

Level 2 — defined as inputs other than quoted prices in active markets that are either directly or indirectly observable

•

Level 3 — defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions

Marketable securities classified in Level 1 and Level 2 as of March 31, 2015 and December 31, 2014 consist of available-for-sale marketable securities. The valuation of Level 1 instruments is determined using a market approach, and is based upon unadjusted quoted prices for identical assets in active markets. The valuation of investments classified in Level 2 also is determined using a market approach based upon quoted prices for similar assets in active markets, or other inputs that are observable for substantially the full term of the financial instrument. Level 2 securities include certificates of deposit, commercial paper and corporate notes that use as their basis readily observable market parameters. The Company did not transfer any assets between Level 2 and Level 1 during the three months ended March 31, 2015.

As of March 31, 2015, the Company held certain assets that are required to be measured at fair value on a recurring basis, as follows:

Fair Value Measurement as of March 31, 2015 Using

(in thousands)

March 31,

Quoted Prices in

Significant Other

Significant

2015

Active Markets for

Observable Inputs

Unobservable

Identical Assets

(Level 2)

Inputs

(Level 1)

(Level 3)

Available-for-sale securities

101,520

47,996

53,524

—

As of December 31, 2014, the Company held certain assets that are required to be measured at fair value on a recurring basis, as follows:

Fair Value Measurement as of December 31, 2014 Using

(in thousands)

December 31,

Quoted Prices in

Significant Other

Significant

2014

Active Markets for

Observable Inputs

Unobservable

Identical Assets

(Level 2)

Inputs

(Level 1)

(Level 3)

Available-for-sale securities

68,921

30,618

38,303

—

The Company also has financial assets and liabilities, not required to be measured at fair value on a recurring basis, which primarily consist of cash and cash equivalents, accounts receivable, restricted cash, accounts payable and accrued liabilities, the carrying value of which materially approximate their fair values.

Inventory

Inventory	3 Months Ended
Inventory	Mar. 31, 2015
Inventory	7. Inventory
	The Company evaluates expiry risk by evaluating current and future product demand relative to product shelf life. The Company builds demand forecasts by considering factors such as, but not limited to, overall market potential, market share, market acceptance and patient usage. Inventory consisted of the following as of March 31, 2015 and December 31, 2014:


	(in thousands)	March 31,		December 31,
	(in thousands)	2015		2014
	Raw materials	$	162	$	198
	Work-in-process		1,692		1,326
	Finished goods		3,069		3,394
	Deferred cost of goods sold		292		252

	Total	$	5,215	$	5,170

	Deferred cost of goods sold represents the cost of product shipped to Probiomed, for which revenue recognition has been deferred. See Note 2, Summary of Significant Accounting Policies, for a discussion of Fanapt® revenue recognition.

Prepaid_Expenses_and_Other_Cur

Prepaid Expenses and Other Current Assets	3 Months Ended
Prepaid Expenses and Other Current Assets	Mar. 31, 2015
Prepaid Expenses and Other Current Assets	8. Prepaid Expenses and Other Current Assets
	The following is a summary of the Company’s prepaid expenses and other current assets as of March 31, 2015 and December 31, 2014:


	(in thousands)	March 31,		December 31,
	(in thousands)	2015		2014
	Prepaid insurance	$	52	$	270
	Prepaid manufacturing cost		346		358
	Other prepaid expenses and vendor advances		1,781		2,302
	Other current assets		324		154

	Total prepaid expenses and other current assets	$	2,503	$	3,084

Intangible_Assets

Intangible Assets	3 Months Ended
Intangible Assets	Mar. 31, 2015
Intangible Assets	9. Intangible Assets

	The following is a summary of the Company’s intangible asset as of March 31, 2015:



				March 31, 2015
	(in thousands)	Estimated		Gross		Accumulated		Net
		Useful Life		Carrying		Amortization		Carrying
		(Years)		Amount				Amount
	HETLIOZ®		January 2033	$	33,000	$	2,170	$	30,830
	Fanapt®		November 2016		27,941		11,191		16,750

				$	60,941	$	13,361	$	47,580




	The following is a summary of the Company’s intangible asset as of December 31, 2014:



				December 31, 2014
	(in thousands)	Estimated		Gross		Accumulated		Net
		Useful Life		Carrying		Amortization		Carrying
		(Years)		Amount				Amount
	HETLIOZ®		January 2033	$	8,000	$	539	$	7,461
	Fanapt®		November 2016		27,941		8,678		19,263

				$	35,941	$	9,217	$	26,724


	In January 2014, the Company announced that the FDA had approved the NDA for HETLIOZ®. As a result of this approval, the Company met a milestone under its license agreement with Bristol-Myers Squibb (BMS) that required the Company to make a license payment of $8.0 million to BMS. The $8.0 million is being amortized on a straight-line basis over the remaining life of the U.S. patent for HETLIOZ®, which prior to June 2014, the Company expected to last until December 2022. In June 2014, the Company received a notice of allowance from the U.S. Patent and Trademark Office for a patent covering the method of use of HETLIOZ®. The patent expires in January 2033, thereby potentially extending the exclusivity protection in the U.S. beyond the composition of matter patent. As a result of the patent allowance, the Company extended the estimated useful life of the U.S. patent for HETLIOZ® from December 2022 to January 2033.

	The Company is obligated to make a future milestone payment to BMS of $25.0 million in the event that cumulative worldwide sales of HETLIOZ® reach $250.0 million. The likelihood of achieving the milestone and the related milestone obligation was determined to be probable during the three months ended March 31, 2015. As a result ,the future obligation of $25.0 million was recorded as a non-current liability as of March 31, 2015 along with an addition of $25.0 million to capitalized intangible assets relating to HETLIOZ®. The $25.0 million was determined to be additional consideration for the acquisition of the HETLIOZ® intangible asset, which was created upon FDA approval on January 31, 2014. The actual payment of the $25.0 million will occur once the $250.0 million in cumulative worldwide sales of HETLIOZ® is realized. The $25.0 million is being amortized on a straight-line basis over the remaining life of the U.S. patent for HETLIOZ®, which is expected to be January 2033. Amortization of intangible assets relating to HETLIOZ® amounted to $1.6 million for the three months ended March 31, 2015 and includes a catch-up adjustment of $1.2 million to retroactively record cumulative amortization from January 31, 2014 to December 31, 2014 for the milestone obligation of $25.0 million. In future periods the Company expects annual amortization of capitalized intangible asset costs relating to HETLIOZ® will amount to $1.7 million until the expiration of the patent in 2033.

	In 2009, the Company announced that the FDA had approved the NDA for Fanapt®. As a result of this approval, the Company met a milestone under its original sublicense agreement with Novartis that required the Company to make a license payment of $12.0 million to Novartis. The $12.0 million is being amortized on a straight-line basis over the remaining life of the U.S. composition of matter patent for Fanapt® to November 2016.

	Pursuant to the Settlement Agreement, Novartis transferred all U.S. and Canadian rights in the Fanapt® franchise to the Company. As a result, the Company recognized an intangible asset of $15.9 million on December 31, 2014 related to the reacquired right to Fanapt®, which is being amortized on a straight-line basis through November 2016. The useful life estimation for the Fanapt® intangible asset is based on the market participant methodology prescribed by ASC 805, and therefore does not reflect the impact of additional Fanapt® patents solely owned by the Company with varying expiration dates, the latest of which is October 2030. See Note 3, Settlement Agreement with Novartis, for further discussion.

	The intangible assets are being amortized over their estimated useful economic life using the straight-line method. Amortization expense was $4.1 million and $0.6 million for the three months ended March 31, 2015 and 2014, respectively. The following is a summary of the future intangible asset amortization schedule as of March 31, 2015:



	(in thousands)	Total		Remainder		2016		2017		2018		2019		Thereafter
	(in thousands)	Total		of 2015		2016		2017		2018		2019		Thereafter
	HETLIOZ®	$	30,830	$	1,290	$	1,721	$	1,721	$	1,721	$	1,721	$	22,656
	Fanapt®		16,750		7,537		9,213		—		—		—		—

		$	47,580	$	8,827	$	10,934	$	1,721	$	1,721	$	1,721	$	22,656

Accrued_Liabilities

Accrued Liabilities	3 Months Ended
Accrued Liabilities	Mar. 31, 2015
Accrued Liabilities	10. Accrued Liabilities
	The following is a summary of the Company’s accrued liabilities as of March 31, 2015 and December 31, 2014:


	(in thousands)	March 31,		December 31,
	(in thousands)	2015		2014
	Accrued sales allowances	$	14,683	$	495
	Accrued research and development expenses		1,992		1,759
	Accrued consulting and other professional fees		6,923		2,522
	Compensation and employee benefits		1,106		388
	Royalties payable		4,167		602
	Other accrued liabilities		1,428		1,185

		$	30,299	$	6,951

Deferred_Revenue

Deferred Revenue	3 Months Ended
Deferred Revenue	Mar. 31, 2015
Deferred Revenue	11. Deferred Revenue
	The following is a summary of changes in total deferred revenue for the three months ended March 31, 2015 and 2014:


		Three Months Ended
	(in thousands)	March 31,		March 31,
	(in thousands)	2015		2014
	Balance beginning of period	$	174	$	90,275
	Deferred Fanapt® product revenue		239		—
	Licensing revenue recognized		—		7,452

	Balance end of period	$	413	$	82,823

	The Company entered into an amended and restated sublicense agreement with Novartis in 2009, pursuant to which Novartis had the right to commercialize and develop Fanapt® in the U.S. and Canada. Under the amended and restated sublicense agreement, the Company received an upfront payment of $200.0 million. The Company and Novartis established a Joint Steering Committee (JSC) following the effective date of the amended and restated sublicense agreement. The Company concluded that the JSC constitutes a deliverable under the amended and restated sublicense agreement and that revenue related to the upfront payment will be recognized ratably over the term of the JSC; however, the delivery or performance had no term as the exact length of the JSC is undefined. As a result, the Company deemed the performance period of the JSC to be the life of the U.S. patent of Fanapt®. Revenue related to the upfront payment was recognized ratably from the date the amended and restated sublicense agreement became effective (November 2009) through the expected duration of the Novartis commercialization of Fanapt® in the U.S. which was estimated to be through the expiry of the Fanapt® composition of patent, including a granted Hatch-Waxman extension (November 2016). During the year ended December 31, 2014, the Company recognized revenue of $30.7 million related to the license agreement.
	In connection with the Settlement Agreement, the Company recognized the remaining deferred revenue balance of $59.5 million during the three months ended December 31, 2014, as part of the gain on arbitration settlement. See Note 3, Settlement Agreement with Novartis, for further discussion.

Income_Taxes

Income Taxes	3 Months Ended
	Mar. 31, 2015
Income Taxes	12. Income Taxes
	Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The fact that the Company has historically generated net operating losses (NOLs) serves as strong evidence that it is more likely than not that deferred tax assets will not be realized in the future. Therefore, the Company has a full valuation allowance against all deferred tax assets as of March 31, 2015 and December 31, 2014. Changes in ownership may limit the amount of NOL carryforwards that can be utilized in the future to offset taxable income. Ownership changes did occur as of December 31, 2014 and December 31, 2008. However, the Company believes that it had sufficient Built-In-Gain to offset the IRC Section 382 limitation generated by the ownership changes. Any future ownership changes may cause the Company’s existing tax attributes to have additional limitations.

Commitments_and_Contingencies

Commitments and Contingencies

3 Months Ended

Mar. 31, 2015

Commitments and Contingencies

13. Commitments and Contingencies

Operating leases

The following is a summary of the minimum annual future payments under operating leases as of March 31, 2015:

(in thousands)

Total

Remainder

2016

2017

2018

2019

Thereafter

of 2015

Operating leases

14,446

1,131

1,500

1,538

1,576

1,616

7,085

The minimum annual future payments for operating leases consists of the lease for office space for the Company’s headquarters located in Washington, D.C., which expires in 2023.

In 2011, the Company entered into an office lease with Square 54 Office Owner LLC (the Landlord) for Vanda’s current headquarters, consisting of 21,400 square feet at 2200 Pennsylvania Avenue, N.W. in Washington, D.C. (the Lease). Subject to the prior rights of other tenants in the building, the Company has the right to renew the Lease for five years following the expiration of its original term. The Company has the right to sublease or assign all or a portion of the premises, subject to standard conditions. The Lease may be terminated early by the Company or the Landlord upon certain conditions.

In March 2014, the Company and the Landlord entered into a lease amendment (the Lease Amendment). Under the Lease Amendment, the Company has the right to occupy an additional 8,860 square feet in the building. The Lease Amendment has a 12 year and one month term beginning on September 1, 2014, but may be terminated early by either the Landlord or the Company upon certain conditions. The Company will pay approximately $0.4 million in additional annual rent over the term of the Lease Amendment; however, rent is being abated for the first nine months. The Landlord will provide the Company with an allowance of approximately $0.8 million for construction on the premises to the Company’s specifications, subject to certain conditions. The allowance for tenant improvements will be reflected in the consolidated financial statements as an increase to capitalized leasehold improvements and an increase to deferred rent. Subject to the prior rights of other tenants in the building, the Company will have the right to renew the Lease Amendment for five years following the expiration of its original term. The Company will also have the right to sublease or assign all or a portion of the premises, subject to standard conditions.

Rent expense under operating leases, was $0.4 million and $0.4 million for the three months ended March 31, 2015 and 2014, respectively.

Guarantees and indemnifications

The Company has entered into a number of standard intellectual property indemnification agreements in the ordinary course of its business. Pursuant to these agreements, the Company indemnifies, holds harmless, and agrees to reimburse the indemnified party for losses suffered or incurred by the indemnified party, generally the Company’s business partners or customers, in connection with any U.S. patent or any copyright or other intellectual property infringement claim by any third party with respect to the Company’s products. The term of these indemnification agreements is generally perpetual from the date of execution of the agreement. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited. Since inception, the Company has not incurred costs to defend lawsuits or settle claims related to these indemnification agreements. The Company also indemnifies its officers and directors for certain events or occurrences, subject to certain conditions.

License agreements

The Company’s rights to develop and commercialize its products are subject to the terms and conditions of licenses granted to the Company by other pharmaceutical companies.

HETLIOZ®. In February 2004, the Company entered into a license agreement with BMS under which it received an exclusive worldwide license under certain patents and patent applications, and other licenses to intellectual property, to develop and commercialize HETLIOZ®. In partial consideration for the license, the Company paid BMS an initial license fee of $0.5 million. The Company made a milestone payment to BMS of $1.0 million under the license agreement in 2006 relating to the initiation of its first Phase III clinical trial for HETLIOZ®. As a result of the FDA acceptance of the Company’s NDA for HETLIOZ® for the treatment of Non-24 in July 2013, the Company incurred a $3.0 million milestone obligation under the license agreement with BMS. As a result of the FDA’s approval of the HETLIOZ® NDA in January 2014, the Company incurred an $8.0 million milestone obligation in the first quarter of 2014 under the same license agreement that was capitalized as an intangible asset and is being amortized over the expected HETLIOZ® patent life in the U.S. The Company is obligated to make a future milestone payment to BMS of $25.0 million in the event that cumulative worldwide sales of HETLIOZ® reach $250.0 million. During the first quarter of 2015, the likelihood of achieving the milestone and the related milestone obligation was determined to be probable. As such, the $25.0 million milestone obligation was capitalized as an intangible asset and is being amortized over the expected HETLIOZ® patent life in the U.S. The actual payment of the $25.0 million will occur once the $250.0 million in cumulative worldwide sales of HETLIOZ® is realized. Additionally, the Company is obligated to make royalty payments on HETLIOZ® net sales to BMS in any territory where the Company commercializes HETLIOZ® for a period equal to the greater of 10 years following the first commercial sale in the territory or the expiry of the new chemical entity patent in that territory. During the period prior to the expiry of the new chemical entity patent in a territory, the Company is obligated to pay a 10% royalty on net sales in that territory. The royalty rate is decreased by half for countries in which no new chemical entity patent existed or for the remainder of the 10 years after the expiry of the new chemical entity patent. The Company is also obligated under the license agreement to pay BMS a percentage of any sublicense fees, upfront payments and milestone and other payments (excluding royalties) that it receives from a third party in connection with any sublicensing arrangement, at a rate which is in the mid-twenties. The Company has agreed with BMS in the license agreement for HETLIOZ® to use its commercially reasonable efforts to develop and commercialize HETLIOZ®.

The license agreement was amended in April 2013 to add a process that would allow BMS to waive the right to develop and commercialize HETLIOZ® in those countries not covered by a development and commercialization agreement. Subsequent to the execution of the April 2013 amendment, BMS provided the Company with formal written notice that it irrevocably waived the option to exercise the right to reacquire any or all rights to any product (as defined in the license agreement) containing HETLIOZ®, or to develop or commercialize any such product, in the countries not covered by a development and commercialization agreement.

Either party may terminate the HETLIOZ® license agreement under certain circumstances, including a material breach of the agreement by the other. In the event the Company terminates the license, or if BMS terminates the license due to the Company’s breach, all rights licensed and developed by the Company under the license agreement will revert or otherwise be licensed back to BMS on an exclusive basis.

Fanapt®. Pursuant to the terms of the Settlement Agreement, Novartis transferred all U.S. and Canadian rights in the Fanapt® franchise to the Company on December 31, 2014.

A predecessor company of Sanofi, Hoechst Marion Roussel, Inc. (HMRI) discovered Fanapt® and completed early clinical work on the product. In 1996, following a review of its product portfolio, HMRI licensed its rights to the Fanapt® patents and patent applications to Titan Pharmaceuticals, Inc. (Titan) on an exclusive basis. In 1997, soon after it had acquired its rights, Titan sublicensed its rights to Fanapt® on an exclusive basis to Novartis. In June 2004, the Company acquired exclusive worldwide rights to these patents and patent applications, as well as certain Novartis patents and patent applications to develop and commercialize Fanapt®, through a sublicense agreement with Novartis. In partial consideration for this sublicense, the Company paid Novartis an initial license fee of $0.5 million and was obligated to make future milestone payments to Novartis (the majority of which were tied to sales milestones), as well as royalty payments to Novartis at a rate which, as a percentage of net sales, was in the mid-twenties. As a result of the FDA’s approval of the NDA for Fanapt® in May 2009, the Company met a milestone under the sublicense agreement, which required it to make a payment of $12.0 million to Novartis.

In October 2009, the Company entered into an amended and restated sublicense agreement with Novartis, which amended and restated the June 2004 sublicense agreement. Pursuant to the amended and restated sublicense agreement, Novartis has exclusive commercialization rights to all formulations of Fanapt® in the U.S. and Canada. Novartis began selling Fanapt® in the U.S. during the first quarter of 2010. Novartis was responsible for the further clinical development activities in the U.S. and Canada. Pursuant to the amended and restated sublicense agreement, the Company received an upfront payment of $200.0 million and was eligible for additional payments upon Novartis’ achievement of certain commercial and development milestones for Fanapt® in the U.S. and Canada. The Company also received royalties, which, as a percentage of net sales, were in the low double-digits, on net sales of Fanapt® in the U.S. and Canada. The Company retained exclusive rights to Fanapt® outside the U.S. and Canada and is obligated to make royalty payments to Sanofi S.A. on Fanapt® sales outside the U.S. and Canada.

The Company has entered into agreements with the following partners for the commercialization of Fanapt® in the countries set forth below:

Country

Partner

Market Approval Date

Mexico

Probiomed S.A. de C.V.

October 2013

Israel

Megapharm Ltd.

August 2012

Pursuant to the terms of the Settlement Agreement, Novartis transferred all U.S. and Canadian rights in the Fanapt® franchise to the Company on December 31, 2014. The Company is obligated to make royalty payments to Sanofi, S.A. and Titan, at a percentage rate equal to 23% on annual U.S. net sales of Fanapt® up to $200.0 million, and at a percentage in the mid-twenties on sales over $200.0 million through November 2016. After the expiration of the new chemical entity patent in major markets (US, United Kingdom, Germany, France, Italy, Spain and Japan) and some non-major markets, the Company will have a fixed royalty obligation to Sanofi on Fanapt® net sales of up to 9%. See Note 3, Settlement Agreement with Novartis, for further information.

Tradipitant. In April 2012, the Company entered into a license agreement with Eli Lilly and Company (Lilly) pursuant to which the Company acquired an exclusive worldwide license under certain patents and patent applications, and other licenses to intellectual property, to develop and commercialize an NK-1R antagonist, tradipitant, for all human indications. The patent describing tradipitant as a new chemical entity expires in April 2023, except in the U.S., where it expires in June 2024 absent any applicable patent term adjustments.

Pursuant to the license agreement, the Company paid Lilly an initial license fee of $1.0 million and will be responsible for all development costs. The initial license fee was recognized as research and development expense in the consolidated statement of operations for the year ended December 31, 2012. Lilly is also eligible to receive additional payments based upon achievement of specified development and commercialization milestones as well as tiered-royalties on net sales at percentage rates up to the low double digits. These milestones include $4.0 million for pre-NDA approval milestones and up to $95.0 million for future regulatory approval and sales milestones. Vanda is obligated to use its commercially reasonable efforts to develop and commercialize tradipitant.

Either party may terminate the license agreement under certain circumstances, including a material breach of the license agreement by the other. In the event that Vanda terminates the license agreement, or if Lilly terminates due to Vanda’s breach or for certain other reasons set forth in the license agreement, all rights licensed and developed by Vanda under the license agreement will revert or otherwise be licensed back to Lilly on an exclusive basis, subject to payment by Lilly to the Company of a royalty on net sales of products that contain tradipitant.

AQW051. In connection with the Settlement Agreement, the Company received an exclusive worldwide license under certain patents and patent applications, and other licenses to intellectual property, to develop and commercialize AQW051, a Phase II alpha-7 nicotinic acetylcholine receptor partial agonist.

Pursuant to the license agreement, the Company is obligated to use its commercially reasonable efforts to develop and commercialize AQW051 and is responsible for all development costs under the AQW051 license agreement. The Company has no milestone obligations; however, Novartis is eligible to receive tiered-royalties on net sales at percentage rates up to the mid-teens.

Research and development and marketing agreements

In the course of its business, the Company regularly enters into agreements with clinical organizations to provide services relating to clinical development and clinical manufacturing activities under fee service arrangements. The Company’s current agreements for clinical services may be terminated on generally 60 days’ notice without incurring additional charges, other than charges for work completed but not paid for through the effective date of termination and other costs incurred by the Company’s contractors in closing out work in progress as of the effective date of termination.

Legal_Matters

Legal Matters	3 Months Ended
Legal Matters	Mar. 31, 2015
Legal Matters	14. Legal Matters

	In June 2014, the Company filed suit against Roxane Laboratories, Inc. (Roxane) in the U.S. District Court for the District of Delaware. The suit seeks an adjudication that Roxane has infringed one or more claims of the Company’s U.S. Patent No. 8,586,610 (the Patent) by submitting to the FDA an Abbreviated New Drug Application (ANDA) for generic versions of Fanapt® oral tablets in 1 mg, 2 mg, 4 mg, 6 mg, 8 mg, 10 mg, and 12 mg strengths. The relief requested by the Company includes a request for a permanent injunction preventing Roxane from infringing the asserted claims of the Patent by engaging in the manufacture, use, offer to sell, sale, importation or distribution of generic versions of Fanapt® before the expiration of the Patent in 2027.

	Pursuant to the Settlement Agreement, the Company assumed Novartis’ patent infringement action against Roxane in the U.S. District Court for the District of Delaware. The suit alleges that Roxane’s filing of an ANDA for generic iloperidone with a paragraph IV certification infringes Sanofi’s new chemical entity patent. Roxane is defending on the grounds that the patent claims are invalid or unenforceable or that certain patent claims are not infringed. Roxane also filed a motion to dismiss on the grounds that the court lacks jurisdiction.

	The two pending cases against Roxane were consolidated by agreement of the parties in April 2015 and are scheduled to be tried together in a four-day bench trial beginning on February 29, 2016.

	In May 2015, the Company announced that it filed a lawsuit in the U.S. District Court for the District of Delaware against Inventia Healthcare Pvt. Ltd. (Inventia) for patent infringement. The lawsuit was filed as a result of Inventia submitting an ANDA seeking approval for generic versions of Fanapt® prior to the expiration of the Patent. Vanda received Inventia’s paragraph IV notice regarding the Patent on April 3, 2015.

Employee_StockBased_Compensati

Employee Stock-Based Compensation	3 Months Ended
Employee Stock-Based Compensation	Mar. 31, 2015
Employee Stock-Based Compensation	15. Employee Stock-Based Compensation
	Compensation costs for all stock-based awards to employees and directors are measured based on the grant date fair value of those awards and recognized over the period during which the employee or director is required to perform service in exchange for the award. The Company recognizes the expense over the award’s vesting period.
	The fair value of stock options granted and RSUs awarded are amortized using the straight-line method. As stock-based compensation expense recognized in the consolidated statements of operations is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures. Forfeitures are required to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.
	The fair value of each option award is estimated on the date of grant using the Black-Scholes-Merton option pricing model that uses the assumptions noted in the following table. Expected volatility rates are based on the historical volatility of the Company’s publicly traded common stock and other factors. The risk-free interest rates are based on the U.S. Treasury yield for a period consistent with the expected term of the option in effect at the time of the grant. The Company has not paid dividends to its stockholders since its inception (other than a dividend of preferred share purchase rights, which was declared in September 2008) and does not plan to pay dividends in the foreseeable future.
	Assumptions used in the Black-Scholes-Merton option pricing model for employee and director stock options granted during the three months ended March 31, 2015 and 2014 were as follows:


			Three Months Ended
			March 31,				March 31,
			2015				2014
	Expected dividend yield			0	%			0	%
	Weighted average expected volatility			61	%			66	%
	Weighted average expected term (years)			5.97				5.85
	Weighted average risk-free rate			1.59	%			1.79	%
	Weighted average fair value per share		$	6.14			$	7.9
	Total employee stock-based compensation expense related to stock-based awards for the three months ended March 31, 2015 and 2014 was comprised of the following:


			Three Months Ended
	(in thousands)		March 31,				March 31,
	(in thousands)		2015				2014
	Research and development		$	603			$	442
	Selling, general and administrative			1,321				912

			$	1,924			$	1,354


	As of March 31, 2015, the Company had two equity incentive plans, the Second Amended and Restated Management Equity Plan (the 2004 Plan) and the 2006 Equity Incentive Plan (the 2006 Plan) that were adopted in December 2004 and April 2006, respectively. An aggregate of 594,082 shares were subject to outstanding options granted under the 2004 Plan as of March 31, 2015, and no additional options will be granted under this plan. As of March 31, 2015, there were 11,829,472 shares of the Company’s common stock reserved for issuance under the 2006 Plan, of which 7,505,463 shares were subject to outstanding options and RSUs granted to employees and non-employees and 1,930,220 shares remained available for future grant. On January 1 of each year, the number of shares reserved under the 2006 Plan is automatically increased by the lesser of 4% of the total number of shares of common stock that are outstanding at that time or 1,500,000 shares (or such lesser number as may be approved by the Company’s board of directors). As of January 1, 2015, the number of shares of common stock that may be issued under the 2006 Plan was automatically increased by 1,500,000 shares, increasing the number of shares of common stock available for issuance under the Plan to 11,829,472 shares.
	The Company has granted option awards with service conditions (service option awards) that are subject to terms and conditions established by the compensation committee of the board of directors. Service option awards have 10-year contractual terms and all service option awards granted prior to December 31, 2006, service option awards granted to new employees, and certain service option awards granted to existing employees vest and become exercisable on the first anniversary of the grant date with respect to the 25% of the shares subject to service option awards. The remaining 75% of the shares subject to the service option awards vest and become exercisable monthly in equal installments thereafter over three years. Certain service option awards granted to existing employees after December 31, 2006 vest and become exercisable monthly in equal installments over four years. The initial service option awards granted to directors upon their election vest and become exercisable in equal monthly installments over a period of four years, while the subsequent annual service option awards granted to directors vest and become exercisable in equal monthly installments over a period of one year. Certain service option awards to executives and directors provide for accelerated vesting if there is a change in control of the Company. Certain service option awards to employees and executives provide for accelerated vesting if the respective employee’s or executive’s service is terminated by the Company for any reason other than cause or permanent disability. As of March 31, 2015, $15.0 million of unrecognized compensation costs related to unvested service option awards are expected to be recognized over a weighted average period of 1.7 years. No option awards are classified as a liability as of March 31, 2015.
	A summary of option activity for the 2004 Plan for the three months ended March 31, 2015 follows:


	2004 Option Plan						Weighted Average			Weighted Average		Aggregate
	(in thousands, except for share and per share amounts)		Number of				Exercise Price at			Remaining Term		Intrinsic
	(in thousands, except for share and per share amounts)		Shares				Grant Date			(Years)		Value
	Outstanding at December 31, 2014			652,810				1.74			0.78		8,212
	Expired			—
	Exercised			(58,728	)			1.12					590

	Outstanding at March 31, 2015			594,082				1.8			0.58		4,455

	Exercisable at March 31, 2015			594,082				1.8			0.58		4,455

	Vested and expected to vest at March 31, 2015			594,082				1.8			0.58		4,455


	A summary of option activity for the 2006 Plan for the three months ended March 31, 2015 follows:


	2006 Option Plan						Weighted Average			Weighted Average		Aggregate
	(in thousands, except for share and per share amounts)		Number of				Exercise Price at			Remaining Term		Intrinsic
	(in thousands, except for share and per share amounts)		Shares				Grant Date			(Years)		Value
	Outstanding at December 31, 2014			6,227,112				11.58			6.71		28,523
	Granted			459,000				11.61
	Forfeited			(89,893	)			11.39
	Expired			—
	Exercised			(42,562	)			4.59					254

	Outstanding at March 31, 2015			6,553,657				11.63			6.66		8,878

	Exercisable at March 31, 2015			4,023,610				12.22			5.13		6,788

	Vested and expected to vest at March 31, 2015			6,324,233				11.63			6.56		8,835

Proceeds from the exercise of stock options amounted to $0.2 million for the three months ended March 31, 2015.
An RSU is a stock award that entitles the holder to receive shares of the Company’s common stock as the award vests. The fair value of each RSU is based on the closing price of the Company’s stock on the date of grant. The Company has granted RSUs with service conditions (service RSUs) that vest in four equal annual installments provided that the employee remains employed with the Company. As of March 31, 2015, $9.6 million of unrecognized compensation costs related to unvested service RSUs are expected to be recognized over a weighted average period of 2.1 years. No service RSUs are classified as a liability as of March 31, 2015.
A summary of RSU activity for the 2006 Plan for the three months ended March 31, 2015 follows:


RSUs		Number of				Weighted
		Shares				Average
		Underlying				Grant Date
		RSUs				Fair Value
Unvested at December 31, 2014			1,025,961			$	9.94
Granted			188,000				11.64
Forfeited			(31,062	)			11.33
Vested			(231,093	)			7.96

Unvested at March 31, 2015			951,806				10.71

The grant date fair value for the 231,093 shares underlying RSUs that vested during the three months ended March 31, 2015 was $1.8 million.

Business_Organization_and_Pres1

Business Organization and Presentation (Policies)	3 Months Ended
	Mar. 31, 2015
Business Organization	Business Organization
	Vanda Pharmaceuticals Inc. (Vanda or the Company) is a biopharmaceutical company focused on the development and commercialization of products for the treatment of central nervous system disorders. Vanda commenced its operations in 2003 and the Company’s portfolio includes the following products:

		•		HETLIOZ® (tasimelteon), a product for the treatment of Non-24-Hour Sleep-Wake Disorder (Non-24) for which a New Drug Application (NDA) was approved by the U.S. Food and Drug Administration (FDA) in January 2014 and launched commercially in the U.S. in April 2014. In April 2015, the European Medicines Agency’s (EMA) Committee for Medicinal Products for Human Use (CHMP) adopted a positive opinion recommending approval of HETLIOZ® for the treatment of Non-24 in totally blind adults in the European Union (EU). The CHMP positive opinion will be reviewed by the European Commission (EC). If approved, the EC grants a centralized marketing authorization with unified labeling that is valid in the 28 countries that are members of the EU, as well as European Economic Area members Iceland, Liechtenstein and Norway. The EC final decision is expected mid-year 2015. HETLIOZ® has potential utility in a number of circadian rhythm disorders. Ongoing HETLIOZ® life cycle management activities include an observation study in Smith-Magenis Syndrome (SMS) and a clinical development plan is being develop for pediatric Non-24. In addition, the Company is evaluating the use of HETLIOZ® in other circadian rhythm indications and exploring the creation of a new liquid formulation of HETLIOZ®.

		•		Fanapt® (iloperidone), a product for the treatment of schizophrenia, the oral formulation of which was being marketed and sold in the U.S. by Novartis Pharma AG (Novartis) until December 31, 2014. On December 31, 2014, Novartis transferred all the U.S. and Canadian commercial rights to the Fanapt® franchise to the Company. See Note 3, Settlement Agreement with Novartis, for further information. Additionally, the Company’s distribution partners launched Fanapt® in Israel and Mexico in 2014.

		•		Tradipitant (VLY-686), a small molecule neurokinin-1 receptor (NK-1R) antagonist, which is presently in clinical development for the treatment of chronic pruritus in atopic dermatitis. Results from a Phase II study for the treatment of chronic pruritus in atopic dermatitis were announced in March 2015. Clinical evaluation is ongoing to assess potential future development activities.

		•		Trichostatin A, a small molecule histone deacetylase (HDAC) inhibitor.

		•		AQW051, a Phase II alpha-7 nicotinic acetylcholine receptor partial agonist.
Basis of Presentation	Basis of Presentation
	The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with the Company’s consolidated financial statements for the fiscal year ended December 31, 2014 included in the Company’s annual report on Form 10-K. The financial information as of March 31, 2015 and for the three months ended March 31, 2015 and 2014 is unaudited, but in the opinion of management, all adjustments, consisting only of normal recurring accruals, considered necessary for a fair statement of the results for these interim periods have been included. The condensed consolidated balance sheet data as of December 31, 2014 was derived from audited financial statements but does not include all disclosures required by GAAP.

	The results of the Company’s operations for any interim period are not necessarily indicative of the results that may be expected for any other interim period or for a full fiscal year. The financial information included herein should be read in conjunction with the consolidated financial statements and notes in the Company’s annual report on Form 10-K for the fiscal year ended December 31, 2014.
Use of Estimates	Use of Estimates
	The preparation of financial statements in conformity with GAAP requires management to make estimates that affect the reported amounts of assets and liabilities at the date of the financial statements, disclosure of contingent assets and liabilities, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
Inventory	Inventory
	Inventory, which is recorded at the lower of cost or market, includes the cost of third-party manufacturing and other direct and indirect costs and is valued using the first-in, first-out method. The Company capitalizes inventory costs associated with its products upon regulatory approval when, based on management’s judgment, future commercialization is considered probable and the future economic benefit is expected to be realized; otherwise, such costs are expensed as research and development. Inventory is evaluated for impairment by consideration of factors such as lower of cost or market, net realizable value, obsolescence or expiry.
Net Product Sales	Net Product Sales
	The Company’s net product sales consist of sales of HETLIOZ® and, beginning in 2015, sales of Fanapt®. Net sales by product for the three months ended March 31, 2015 and 2014 were as follows:


			Three Months Ended
			March 31,		March 31,
	(in thousands)		2015		2014
	HETLIOZ® product sales, net		$	7,460	$	—
	Fanapt® product sales, net			14,690		—

			$	22,150	$	—

	The Company applies the revenue recognition guidance in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Subtopic 605-15, Revenue Recognition—Products. The Company recognizes revenue from product sales when there is persuasive evidence that an arrangement exists, title to product and associated risk of loss has passed to the customer, the price is fixed or determinable, collectability is reasonably assured and the Company has no further performance obligations.
	HETLIOZ® is only available in the U.S. for distribution through a limited number of specialty pharmacies, and is not available in retail pharmacies. Fanapt® is available in the U.S. for distribution through a limited number of wholesalers and is available in retail pharmacies. The Company invoices and records revenue when its customers, specialty pharmacies and wholesalers, receive product from the third-party logistics warehouse. Revenues and accounts receivable are concentrated with these customers. The top six customers represented 95% of total revenues for the three months ended March 31, 2015, and the top three customers represented 80% of accounts receivable at March 31, 2015. The Company has not experienced any losses relating to receivables from customers.
	The Company has entered into distribution agreements with Probiomed S.A. de C.V. (Probiomed) for the commercialization of Fanapt® in Mexico and Megapharm Ltd. for the commercialization of Fanapt® in Israel. With the exception of sales to Probiomed, the Company invoices and records revenue upon delivery of Fanapt® to the distribution partner. The Probiomed distribution agreement contains a contracted delivery price plus a revenue sharing provision based on Probiomed’s sales of Fanapt®. As a result, the selling price of Fanapt® is not fixed or determinable upon delivery of Fanapt® to Probiomed. The Company defers revenue recognition until the revenue sharing provision is calculated. As of March 31, 2015, the Company recorded $0.4 million of deferred revenue related to Fanapt® sales.
	Product Sales Discounts and Allowances
	The Company’s product sales are recorded net of applicable discounts, chargebacks, rebates, co-pay assistance, service fees and product returns that are applicable for various government and commercial payors. Reserves established for discounts and returns are classified as reductions of accounts receivable if the amount is payable to direct customers, with the exception of service fees. Service fees are classified as a liability. Reserves established for chargebacks, rebates or co-pay assistance are classified as a liability if the amount is payable to a party other than customers. The Company currently records sales allowances for the following:
	Rebates: Allowances for rebates include mandated and supplemental discounts under the Medicaid Drug Rebate Program as well as contracted rebate programs with other payors. Rebate amounts owed after the final dispensing of the product to a benefit plan participant are based upon contractual agreements or legal requirements with public sector benefit providers, such as Medicaid. The allowance for rebates is based on statutory or contracted discount rates and expected utilization. Estimates for the expected utilization of rebates are based on historical activity and, where available, actual and pending prescriptions for which the Company has validated the insurance benefits. Rebates are generally invoiced and paid in arrears, such that the accrual balance consists of an estimate of the amount expected to be incurred for the current quarter’s activity, plus an accrual balance for known prior quarter’s unpaid rebates. If actual future invoicing varies from estimates, the Company may need to adjust accruals, which would affect net revenue in the period of adjustment.
	Chargebacks: Chargebacks are discounts that occur when contracted customers purchase directly from specialty pharmacies and wholesalers. Contracted customers, which currently consist primarily of Public Health Service institutions, non-profit clinics, and Federal government entities purchasing via the Federal Supply Schedule, generally purchase the product at a discounted price. The specialty pharmacy or wholesaler, in turn, charges back the difference between the price initially paid by the specialty pharmacy or wholesaler and the discounted price paid to the specialty pharmacy or wholesaler by the contracted customer. The allowance for chargebacks is based on historical activity and, where available, actual and pending prescriptions for which the Company has validated the insurance benefits.
	Medicare Part D Coverage Gap: Medicare Part D prescription drug benefit mandates manufacturers to fund approximately 50% of the Medicare Part D insurance coverage gap for prescription drugs sold to eligible patients. Estimates for expected Medicare Part D coverage gap are based in part on historical activity and, where available, actual and pending prescriptions for which the Company has validated the insurance benefits. Funding of the coverage gap is generally invoiced and paid in arrears so that the accrual balance consists of an estimate of the amount expected to be incurred for the current quarter’s activity, plus an accrual balance for known prior quarter activity. If actual future funding varies from estimates, the Company may need to adjust accruals, which would affect net revenue in the period of adjustment.
	Service Fees: The Company also incurs specialty pharmacy and wholesaler fees for services and their data. These fees are based on contracted terms and are known amounts. The Company accrues service fees at the time of revenue recognition, resulting in a reduction of product sales and the recognition of an accrued liability, unless it receives an identifiable and separate benefit for the consideration and it can reasonably estimate the fair value of the benefit received. In which case, service fees are recorded as selling, general and administrative expense.
	Co-payment Assistance: Patients who have commercial insurance and meet certain eligibility requirements may receive co-payment assistance. Co-pay assistance utilization is based on information provided by the Company’s third-party administrator. The allowance for co-pay assistance is based on actual sales and an estimate for pending sales based on either historical activity or pending sales for which the Company has validated the insurance benefits.
	Prompt-pay: Specialty pharmacies and wholesalers are offered discounts for prompt payment. The Company expects that the specialty pharmacies and wholesalers will earn prompt payment discounts and, therefore, deducts the full amount of these discounts from total product sales when revenues are recognized.

	Product Returns: Consistent with industry practice, the Company generally offers direct customers a limited right to return as defined within the Company’s returns policy. The Company considers several factors in the estimation process, including historical return activity, expiration dates of product shipped to specialty pharmacies, inventory levels within the distribution channel, product shelf life, prescription trends and other relevant factors.
Stock-based Compensation	Stock-based Compensation
	Compensation costs for all stock-based awards to employees and directors are measured based on the grant date fair value of those awards and recognized over the period during which the employee or director is required to perform service in exchange for the award. The Company generally recognizes the expense over the award’s vesting period. The fair value of restricted stock units (RSUs) awarded is also amortized using the straight line method. Stock-based compensation expense recognized in the consolidated statements of operations is based on awards ultimately expected to vest. Therefore, it has been reduced for estimated forfeitures. Forfeitures are required to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.
Advertising Expense	Advertising Expense
	The Company expenses the costs of advertising, including branded promotional expenses, as incurred. Branded advertising expenses, recorded in selling, general and administrative expenses, were $1.0 million and $0.9 million for the three months ended March 31, 2015 and 2014, respectively.
Segment Reporting	Segment Reporting
	The Company operates in one reporting segment and, accordingly, no segment disclosures are presented herein.
Recent accounting pronouncements	Recent accounting pronouncements
	In January 2015, the Financial Accounting Standards board (FASB) issued Accounting Standards Update (ASU) 2015-01, Income Statement-Extraordinary and Unusual Items, to simplify income statement classification by removing the concept of extraordinary items from U.S. GAAP. As a result, items that are both unusual and infrequent will no longer be separately reported net of tax after continuing operations. The new standard is effective for both public and private companies for periods beginning after December 15, 2015. Adoption of this new standard is not expected to have a material impact on the Company’s consolidated financial statements.
	In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements – Going Concern. The new standard requires management of public and private companies to evaluate whether there is substantial doubt about the entity’s ability to continue as a going concern and, if so, disclose that fact. Management will also be required to evaluate and disclose whether its plans alleviate that doubt. The new standard is effective for annual periods ending after December 15, 2016, and interim periods within annual periods beginning after December 15, 2016. Adoption of this new standard is not expected to have a material impact on the Company’s consolidated financial statements.
	In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). This new standards requires companies to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which a company expects to be entitled in exchange for those goods or services. Under the new standard, revenue is recognized when a customer obtains control of a good or service. The standard allows for two transition methods - entities can either apply the new standard (i) retrospectively to each prior reporting period presented, or (ii) retrospectively with the cumulative effect of initially applying the standard recognized at the date of initial adoption. The new standard is effective for public companies for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. Early adoption of the standard is prohibited. The Company is evaluating this standard to determine if adoption will have a material impact on the Company’s consolidated financial statements.

Summary_of_Significant_Account1

Summary of Significant Accounting Policies (Tables)	3 Months Ended
Summary of Significant Accounting Policies (Tables)	Mar. 31, 2015
Net Sales by Product	The Company’s net product sales consist of sales of HETLIOZ® and, beginning in 2015, sales of Fanapt®. Net sales by product for the three months ended March 31, 2015 and 2014 were as follows:


		Three Months Ended
		March 31,		March 31,
	(in thousands)	2015		2014
	HETLIOZ® product sales, net	$	7,460	$	—
	Fanapt® product sales, net		14,690		—

		$	22,150	$	—

Settlement_Agreement_with_Nova1

Settlement Agreement with Novartis (Tables)	3 Months Ended
Settlement Agreement with Novartis (Tables)	Mar. 31, 2015
Fair Value of Consideration Exchanged as Part of Settlement Agreement	The following summarizes the fair value of consideration exchanged as part of the Settlement Agreement:


	(in thousands)
	Equity issued	$	25,904
	Cash received		(25,000	)
	Settlement of pre-existing non-contractual relationship		18,087

		$	18,991

Assets Acquired and Recorded at Fair Value	Assets acquired and recorded at fair value as of December 31, 2014 were as follows:


	(in thousands)
	Inventory	$	2,960
	Intangible - Re-acquired right		15,940
	Prepaid services		91

		$	18,991

Earnings_per_Share_Tables

Earnings per Share (Tables)	3 Months Ended
Earnings per Share (Tables)	Mar. 31, 2015
Basic and Diluted Net Loss Per Share of Common Stock	The following table presents the calculation of basic and diluted net loss per share of common stock for the three months ended March 31, 2015 and 2014:


		Three Months Ended
	(in thousands, except for share and per share amounts)	March 31,			March 31,
	(in thousands, except for share and per share amounts)	2015			2014
	Numerator:
	Net loss	$	(10,221	)	$	(26,533	)

	Denominator:
	Weighted average shares outstanding, basic and diluted		41,744,948			33,678,706

	Net loss per share, basic and diluted:
	Net loss per share	$	(0.24	)	$	(0.79	)

	Antidilutive securities excluded from calculations of diluted net loss per share		5,656,662			3,870,508

Marketable_Securities_Tables

Marketable Securities (Tables)	3 Months Ended
Marketable Securities (Tables)	Mar. 31, 2015
Summary of Available-for-Sale Marketable Securities	The following is a summary of the Company’s available-for-sale marketable securities as of March 31, 2015, which all have contract maturities of less than one year:


	March 31, 2015	Amortized		Gross		Gross			Fair
	March 31, 2015	Amortized		Unrealized		Unrealized			Market
	(in thousands)	Cost		Gains		Losses			Value
	U.S. Treasury and government agencies	$	47,992	$	7	$	(3	)	$	47,996
	Corporate debt		53,501		28		(5	)		53,524

		$	101,493	$	35	$	(8	)	$	101,520


	The following is a summary of the Company’s available-for-sale marketable securities as of December 31, 2014:


	December 31, 2014	Amortized		Gross		Gross			Fair
	December 31, 2014	Amortized		Unrealized		Unrealized			Market
	(in thousands)	Cost		Gains		Losses			Value
	U.S. Treasury and government agencies	$	30,618	$	4	$	(4	)	$	30,618
	Corporate debt		38,287		25		(9	)		38,303

		$	68,905	$	29	$	(13	)	$	68,921

Fair_Value_Measurements_Tables

Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2015

Assets Measured at Fair Value on Recurring Basis

As of March 31, 2015, the Company held certain assets that are required to be measured at fair value on a recurring basis, as follows:

Fair Value Measurement as of March 31, 2015 Using

(in thousands)

March 31,

Quoted Prices in

Significant Other

Significant

2015

Active Markets for

Observable Inputs

Unobservable

Identical Assets

(Level 2)

Inputs

(Level 1)

(Level 3)

Available-for-sale securities

101,520

47,996

53,524

—

As of December 31, 2014, the Company held certain assets that are required to be measured at fair value on a recurring basis, as follows:

Fair Value Measurement as of December 31, 2014 Using

(in thousands)

December 31,

Quoted Prices in

Significant Other

Significant

2014

Active Markets for

Observable Inputs

Unobservable

Identical Assets

(Level 2)

Inputs

(Level 1)

(Level 3)

Available-for-sale securities

68,921

30,618

38,303

—

Inventory_Tables

Inventory (Tables)	3 Months Ended
Inventory (Tables)	Mar. 31, 2015
Inventory	Inventory consisted of the following as of March 31, 2015 and December 31, 2014:


	(in thousands)	March 31,		December 31,
	(in thousands)	2015		2014
	Raw materials	$	162	$	198
	Work-in-process		1,692		1,326
	Finished goods		3,069		3,394
	Deferred cost of goods sold		292		252

	Total	$	5,215	$	5,170

Prepaid_Expenses_and_Other_Cur1

Prepaid Expenses and Other Current Assets (Tables)	3 Months Ended
Prepaid Expenses and Other Current Assets (Tables)	Mar. 31, 2015
Summary of Prepaid Expenses, and Other Current Assets	The following is a summary of the Company’s prepaid expenses and other current assets as of March 31, 2015 and December 31, 2014:


	(in thousands)	March 31,		December 31,
	(in thousands)	2015		2014
	Prepaid insurance	$	52	$	270
	Prepaid manufacturing cost		346		358
	Other prepaid expenses and vendor advances		1,781		2,302
	Other current assets		324		154

	Total prepaid expenses and other current assets	$	2,503	$	3,084

Intangible_Assets_Tables

Intangible Assets (Tables)	3 Months Ended
Intangible Assets (Tables)	Mar. 31, 2015
Summary of Intangible Asset	The following is a summary of the Company’s intangible asset as of March 31, 2015:


				March 31, 2015
	(in thousands)	Estimated		Gross		Accumulated		Net
		Useful Life		Carrying		Amortization		Carrying
		(Years)		Amount				Amount
	HETLIOZ®		January 2033	$	33,000	$	2,170	$	30,830
	Fanapt®		November 2016		27,941		11,191		16,750

				$	60,941	$	13,361	$	47,580


	The following is a summary of the Company’s intangible asset as of December 31, 2014:


				December 31, 2014
	(in thousands)	Estimated		Gross		Accumulated		Net
		Useful Life		Carrying		Amortization		Carrying
		(Years)		Amount				Amount
	HETLIOZ®		January 2033	$	8,000	$	539	$	7,461
	Fanapt®		November 2016		27,941		8,678		19,263

				$	35,941	$	9,217	$	26,724

Summary of Future Intangible Asset Amortization	The following is a summary of the future intangible asset amortization schedule as of March 31, 2015:


	(in thousands)	Total		Remainder		2016		2017		2018		2019		Thereafter
	(in thousands)	Total		of 2015		2016		2017		2018		2019		Thereafter
	HETLIOZ®	$	30,830	$	1,290	$	1,721	$	1,721	$	1,721	$	1,721	$	22,656
	Fanapt®		16,750		7,537		9,213		—		—		—		—

		$	47,580	$	8,827	$	10,934	$	1,721	$	1,721	$	1,721	$	22,656

Accrued_Liabilities_Tables

Accrued Liabilities (Tables)	3 Months Ended
Accrued Liabilities (Tables)	Mar. 31, 2015
Summary of Accrued Liabilities	The following is a summary of the Company’s accrued liabilities as of March 31, 2015 and December 31, 2014:


	(in thousands)	March 31,		December 31,
	(in thousands)	2015		2014
	Accrued sales allowances	$	14,683	$	495
	Accrued research and development expenses		1,992		1,759
	Accrued consulting and other professional fees		6,923		2,522
	Compensation and employee benefits		1,106		388
	Royalties payable		4,167		602
	Other accrued liabilities		1,428		1,185

		$	30,299	$	6,951

Deferred_Revenue_Tables

Deferred Revenue (Tables)	3 Months Ended
Deferred Revenue (Tables)	Mar. 31, 2015
Summary of Changes in Total Deferred Revenue	The following is a summary of changes in total deferred revenue for the three months ended March 31, 2015 and 2014:


		Three Months Ended
	(in thousands)	March 31,		March 31,
	(in thousands)	2015		2014
	Balance beginning of period	$	174	$	90,275
	Deferred Fanapt® product revenue		239		—
	Licensing revenue recognized		—		7,452

	Balance end of period	$	413	$	82,823

Commitments_and_Contingencies_

Commitments and Contingencies (Tables)	3 Months Ended
	Mar. 31, 2015
Summary of Minimum Annual Future Payments under Operating Leases	The following is a summary of the minimum annual future payments under operating leases as of March 31, 2015:


	(in thousands)	Total		Remainder		2016		2017		2018		2019		Thereafter
				of 2015
	Operating leases	$	14,446	$	1,131	$	1,500	$	1,538	$	1,576	$	1,616	$	7,085

Employee_StockBased_Compensati1

Employee Stock-Based Compensation (Tables)	3 Months Ended
Employee Stock-Based Compensation (Tables)	Mar. 31, 2015
Black-Scholes-Merton Option Pricing Model for Employee and Director Stock Options Granted	Assumptions used in the Black-Scholes-Merton option pricing model for employee and director stock options granted during the three months ended March 31, 2015 and 2014 were as follows:


		Three Months Ended
		March 31,			March 31,
		2015			2014
	Expected dividend yield		0	%		0	%
	Weighted average expected volatility		61	%		66	%
	Weighted average expected term (years)		5.97			5.85
	Weighted average risk-free rate		1.59	%		1.79	%
	Weighted average fair value per share	$	6.14		$	7.9
Total Employee Stock-Based Compensation Expense	Total employee stock-based compensation expense related to stock-based awards for the three months ended March 31, 2015 and 2014 was comprised of the following:


		Three Months Ended
	(in thousands)	March 31,			March 31,
	(in thousands)	2015			2014
	Research and development	$	603		$	442
	Selling, general and administrative		1,321			912

		$	1,924		$	1,354

Summary of RSU Activity for 2006 Plan	A summary of RSU activity for the 2006 Plan for the three months ended March 31, 2015 follows:


	RSUs	Number of			Weighted
		Shares			Average
		Underlying			Grant Date
		RSUs			Fair Value
	Unvested at December 31, 2014		1,025,961		$	9.94
	Granted		188,000			11.64
	Forfeited		(31,062	)		11.33
	Vested		(231,093	)		7.96

	Unvested at March 31, 2015		951,806			10.71

2004 Plan
Summary of Option Activity Plan	A summary of option activity for the 2004 Plan for the three months ended March 31, 2015 follows:


	2004 Option Plan				Weighted Average			Weighted Average		Aggregate
	(in thousands, except for share and per share amounts)	Number of			Exercise Price at			Remaining Term		Intrinsic
	(in thousands, except for share and per share amounts)	Shares			Grant Date			(Years)		Value
	Outstanding at December 31, 2014		652,810			1.74			0.78		8,212
	Expired		—
	Exercised		(58,728	)		1.12					590

	Outstanding at March 31, 2015		594,082			1.8			0.58		4,455

	Exercisable at March 31, 2015		594,082			1.8			0.58		4,455

	Vested and expected to vest at March 31, 2015		594,082			1.8			0.58		4,455

2006 Plan
Summary of Option Activity Plan	A summary of option activity for the 2006 Plan for the three months ended March 31, 2015 follows:


	2006 Option Plan				Weighted Average			Weighted Average		Aggregate
	(in thousands, except for share and per share amounts)	Number of			Exercise Price at			Remaining Term		Intrinsic
	(in thousands, except for share and per share amounts)	Shares			Grant Date			(Years)		Value
	Outstanding at December 31, 2014		6,227,112			11.58			6.71		28,523
	Granted		459,000			11.61
	Forfeited		(89,893	)		11.39
	Expired		—
	Exercised		(42,562	)		4.59					254

	Outstanding at March 31, 2015		6,553,657			11.63			6.66		8,878

	Exercisable at March 31, 2015		4,023,610			12.22			5.13		6,788

	Vested and expected to vest at March 31, 2015		6,324,233			11.63			6.56		8,835

Net_Sales_by_Product_Detail

Net Sales by Product (Detail) (USD $)	3 Months Ended
In Thousands, unless otherwise specified	Mar. 31, 2015	Mar. 31, 2014
Revenue from External Customer [Line Items]
Product sales, net	$22,150
Total revenues	22,150	9,143
Hetlioz
Revenue from External Customer [Line Items]
Product sales, net	7,460
Fanapt
Revenue from External Customer [Line Items]
Product sales, net	$14,690

Summary_of_Significant_Account2

Summary of Significant Accounting Policies - Additional Information (Detail) (USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Dec. 31, 2014	Dec. 31, 2013
	Segment	Mar. 31, 2014	Dec. 31, 2014	Dec. 31, 2013
Summary Of Significant Accounting Policies [Line Items]
Deferred revenue	$413,000	$82,823,000	$174,000	$90,275,000
Percentage of insurance coverage gap allocated for prescription drugs	50.00%
Advertising expenses	1,000,000	900,000
Number of reportable segments	1
Customer Concentration Risk \| Sales Revenue, Net
Summary Of Significant Accounting Policies [Line Items]
Concentration Risk, Percentage	95.00%
Number of major customers for sales revenues	6
Credit Concentration Risk \| Accounts Receivable
Summary Of Significant Accounting Policies [Line Items]
Concentration Risk, Percentage	80.00%
Number of major customers for sales revenues	3
Fanapt
Summary Of Significant Accounting Policies [Line Items]
Deferred revenue	$413,000

Settlement_Agreement_with_Nova2

Settlement Agreement with Novartis - Additional Information (Detail) (USD $)	12 Months Ended	3 Months Ended		1 Months Ended
	Dec. 31, 2014	Mar. 31, 2015	Dec. 31, 2014	Dec. 31, 2014	Dec. 31, 2009
Business Acquisition [Line Items]
Intangible assets, amortization method	Straight-line basis
Fanapt
Business Acquisition [Line Items]
Intangible assets, amortizing period end date	2016-11	2016-11
Gain on termination of pre-existing non-contractual relationship	18,100,000
Upfront payment received					200,000,000
Settlement Agreement
Business Acquisition [Line Items]
Net proceeds from offering of common stock	25,000,000
Effective date of the Settlement Agreement	31-Dec-14
Gain on termination of pre-existing non-contractual relationship	18,087,000
Up-front Payment Arrangement
Business Acquisition [Line Items]
Gain on termination of pre-existing non-contractual relationship			59,500,000
Novartis Pharma AG \| Settlement Agreement
Business Acquisition [Line Items]
Net proceeds from offering of common stock				25,000,000
Price per share				$13.82
Stock issued during period, shares				1,808,973
Percentage of premium to average closing prices	10.00%		10.00%	10.00%
Trading days				10 days
Gain (Loss) on issuance of stock				($900,000)

Fair_Value_of_Consideration_Ex

Fair Value of Consideration Exchanged as Part of Settlement Agreement (Detail) (Settlement Agreement, USD $)	12 Months Ended
In Thousands, unless otherwise specified	Dec. 31, 2014
Settlement Agreement
Business Acquisition [Line Items]
Equity issued	$25,904
Cash received	-25,000
Settlement of pre-existing non-contractual relationship	18,087
Business Combination, Consideration Transferred, Total	$18,991

Assets_Acquired_and_Recorded_a

Assets Acquired and Recorded at Fair Value (Detail) (USD $)	Dec. 31, 2014
In Thousands, unless otherwise specified	Dec. 31, 2014
Business Acquisition [Line Items]
Assets acquired and recorded at fair value, Inventory	$2,960
Assets acquired and recorded at fair value, Intangible re-acquired right	15,940
Assets acquired and recorded at fair value, Prepaid services	91
Assets acquired and recorded at fair value	$18,991

Basic_and_Diluted_Net_Income_L

Basic and Diluted Net Income (Loss) Per Share of Common Stock (Detail) (USD $)	3 Months Ended
In Thousands, except Share data, unless otherwise specified	Mar. 31, 2015	Mar. 31, 2014
Numerator:
Net loss	($10,221)	($26,533)
Denominator:
Weighted average shares outstanding, basic and diluted	41,744,948	33,678,706
Net loss per share, basic and diluted:
Net loss per share	($0.24)	($0.79)
Antidilutive securities excluded from calculations of diluted net loss per share	5,656,662	3,870,508

Summary_of_AvailableForSale_Ma

Summary of Available-For-Sale Marketable Securities (Detail) (USD $)	Mar. 31, 2015	Dec. 31, 2014
In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Schedule of Available-for-sale Securities [Line Items]
Fair Market Value	$101,520	$68,921
Current Investment
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	101,493	68,905
Gross Unrealized Gains	35	29
Gross Unrealized Losses	-8	-13
Fair Market Value	101,520	68,921
Current Investment \| U.S. Treasury and government agencies
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	47,992	30,618
Gross Unrealized Gains	7	4
Gross Unrealized Losses	-3	-4
Fair Market Value	47,996	30,618
Current Investment \| Corporate debt
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	53,501	38,287
Gross Unrealized Gains	28	25
Gross Unrealized Losses	-5	-9
Fair Market Value	$53,524	$38,303

Assets_Measured_at_Fair_Value_

Assets Measured at Fair Value on Recurring Basis (Detail) (USD $)	Mar. 31, 2015	Dec. 31, 2014
In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	$101,520	$68,921
Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	47,996	30,618
Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	$53,524	$38,303

Inventory_Detail

Inventory (Detail) (USD $)	Mar. 31, 2015	Dec. 31, 2014
In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Inventory [Line Items]
Raw materials	$162	$198
Work-in-process	1,692	1,326
Finished goods	3,069	3,394
Deferred cost of goods sold	292	252
Total	$5,215	$5,170

Summary_of_Prepaid_Expenses_an

Summary of Prepaid Expenses and Other Current Assets (Detail) (USD $)	Mar. 31, 2015	Dec. 31, 2014
In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Prepaid Expenses And Other Current Assets [Line Items]
Prepaid insurance	$52	$270
Prepaid manufacturing cost	346	358
Other prepaid expenses and vendor advances	1,781	2,302
Other current assets	324	154
Total prepaid expenses and other current assets	$2,503	$3,084

Summary_of_Intangible_Assets_D

Summary of Intangible Assets (Detail) (USD $)	3 Months Ended	12 Months Ended
In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$60,941	$35,941
Accumulated Amortization	13,361	9,217
Net Carrying Amount	47,580	26,724
Hetlioz
Finite-Lived Intangible Assets [Line Items]
Estimated Patent life end date	2033-01	2033-01
Gross Carrying Amount	33,000	8,000
Accumulated Amortization	2,170	539
Net Carrying Amount	30,830	7,461
Fanapt
Finite-Lived Intangible Assets [Line Items]
Estimated Patent life end date	2016-11	2016-11
Gross Carrying Amount	27,941	27,941
Accumulated Amortization	11,191	8,678
Net Carrying Amount	$16,750	$19,263

Intangible_Assets_Textual_3_Fa

Intangible Assets (Textual 3 - Fanapt) - Additional Information (Detail) (USD $)	1 Months Ended		3 Months Ended	12 Months Ended	3 Months Ended	12 Months Ended
In Thousands, unless otherwise specified	Jul. 31, 2013	Feb. 28, 2004	Mar. 31, 2014	Dec. 31, 2006	Mar. 31, 2015	Dec. 31, 2014	Dec. 31, 2009	Dec. 31, 2004
Finite-Lived Intangible Assets [Line Items]
Acquisition of intangible assets	$3,000	$500	$8,000	$1,000
Assets acquired and recorded at fair value, Intangible re-acquired right						15,940
Fanapt
Finite-Lived Intangible Assets [Line Items]
Acquisition of intangible assets			8,000				12,000	500
Estimated Patent life end date					2016-11	2016-11
Assets acquired and recorded at fair value, Intangible re-acquired right						$15,940

Intangible_Assets_Textual_2_HE

Intangible Assets (Textual 2 - HETLIOZ) - Additional Information (Detail) (USD $)	3 Months Ended		12 Months Ended	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Dec. 31, 2014	Mar. 31, 2004
Finite-Lived Intangible Assets [Line Items]
Milestone obligation under license agreement	$25,000,000
Intangible asset, amortization	4,144,000	565,000
Hetlioz
Finite-Lived Intangible Assets [Line Items]
Estimated Patent life end date	2033-01		2033-01
Possible future milestone payment in the event product reaches a certain agreed upon sales threshold	25,000,000
Cumulative worldwide sales milestone	250,000,000
Milestone obligation under license agreement	25,000,000
Intangible assets capitalized	25,000,000
Intangible asset, amortization	1,600,000
Hetlioz \| Minimum
Finite-Lived Intangible Assets [Line Items]
Estimated Patent life end date				2022-12
Hetlioz \| Maximum
Finite-Lived Intangible Assets [Line Items]
Estimated Patent life end date				2033-01
Hetlioz \| Catch-up Adjustment
Finite-Lived Intangible Assets [Line Items]
Intangible asset, amortization	1,200,000
Hetlioz \| Future Period
Finite-Lived Intangible Assets [Line Items]
Intangible asset, amortization	$1,700,000

Intangible_Assets_Additional_I

Intangible Assets - Additional Information (Detail) (USD $)	3 Months Ended
In Thousands, unless otherwise specified	Mar. 31, 2015	Mar. 31, 2014
Finite-Lived Intangible Assets [Line Items]
Intangible asset amortization	$4,144	$565

Summary_of_Future_Intangible_A

Summary of Future Intangible Asset Amortization (Detail) (USD $)	Mar. 31, 2015	Dec. 31, 2014
In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Finite-Lived Intangible Assets [Line Items]
Net Carrying Amount	$47,580	$26,724
Remainder of 2015	8,827
2016	10,934
2017	1,721
2018	1,721
2019	1,721
Thereafter	22,656
Hetlioz
Finite-Lived Intangible Assets [Line Items]
Net Carrying Amount	30,830	7,461
Remainder of 2015	1,290
2016	1,721
2017	1,721
2018	1,721
2019	1,721
Thereafter	22,656
Fanapt
Finite-Lived Intangible Assets [Line Items]
Net Carrying Amount	16,750	19,263
Remainder of 2015	7,537
2016	$9,213

Summary_of_Accrued_Liabilities

Summary of Accrued Liabilities (Detail) (USD $)	Mar. 31, 2015	Dec. 31, 2014
In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Accrued Liabilities [Line Items]
Accrued sales allowances	$14,683	$495
Accrued research and development expenses	1,992	1,759
Accrued consulting and other professional fees	6,923	2,522
Compensation and employee benefits	1,106	388
Royalties payable	4,167	602
Other accrued liabilities	1,428	1,185
Accrued liabilities	$30,299	$6,951

Summary_of_Changes_in_Total_De

Summary of Changes in Total Deferred Revenue (Detail) (USD $)	3 Months Ended
In Thousands, unless otherwise specified	Mar. 31, 2015	Mar. 31, 2014
Deferred Revenue Arrangement [Line Items]
Balance beginning of period	$174	$90,275
Deferred FanaptB. product revenue	239
Licensing revenue recognized		7,452
Balance end of period	$413	$82,823

Deferred_Revenue_Additional_In

Deferred Revenue - Additional Information (Detail) (USD $)	3 Months Ended	12 Months Ended	3 Months Ended
Deferred Revenue - Additional Information (Detail) (USD $)	Mar. 31, 2014	Dec. 31, 2014	Dec. 31, 2014	Dec. 31, 2009
Deferred Revenue Arrangement [Line Items]
Licensing agreement	$7,452,000	$30,700,000
Up-front Payment Arrangement
Deferred Revenue Arrangement [Line Items]
Recognized as part of gain on arbitration settlement			59,500,000
Fanapt
Deferred Revenue Arrangement [Line Items]
Upfront payment received				200,000,000
Recognized as part of gain on arbitration settlement		$18,100,000

Summary_of_Minimum_Annual_Futu

Summary of Minimum Annual Future Payments Under Operating Leases (Detail) (USD $)	Mar. 31, 2015
In Thousands, unless otherwise specified	Mar. 31, 2015
Operating Leased Assets [Line Items]
Operating leases, Total	$14,446
Operating leases,Remainder of 2015	1,131
Operating leases, 2016	1,500
Operating leases, 2017	1,538
Operating leases, 2018	1,576
Operating leases, 2019	1,616
Operating leases, Thereafter	$7,085

Commitments_and_Contingencies_1

Commitments and Contingencies - Additional Information (Detail) (USD $)	3 Months Ended		1 Months Ended	12 Months Ended
In Millions, unless otherwise specified	Mar. 31, 2015	Mar. 31, 2014	Mar. 31, 2014	Dec. 31, 2011
	Mar. 31, 2015	Mar. 31, 2014	sqft	sqft
Commitments and Contingencies Disclosure [Line Items]
Rent expense	$0.40	$0.40
Washington DC Lease Amendment
Commitments and Contingencies Disclosure [Line Items]
Renewal term of Lease agreement			5 years
Square feet leased		8,860	8,860
Lease term			12 years 1 month
Additional annual rental payment under lease amendment		0.4	0.4
Allowance for tenant improvements			$0.80
Washington DC Lease
Commitments and Contingencies Disclosure [Line Items]
Renewal term of Lease agreement				5 years
Square feet leased				21,400

Commitments_and_Contingencies_2

Commitments and Contingencies (Textual 2 - HETLIOZ) - Additional Information (Detail) (USD $)	1 Months Ended		3 Months Ended		12 Months Ended
	Jul. 31, 2013	Feb. 28, 2004	Mar. 31, 2015	Mar. 31, 2014	Dec. 31, 2006
HETLIOZ
Acquisition of intangible assets	$3,000,000	$500,000		$8,000,000	$1,000,000
Milestone obligation under license agreement			25,000,000
Percentage of future sublicense fees payable to third-party			Mid-twenties
Hetlioz
HETLIOZ
Milestone obligation under license agreement			25,000,000
Royalty percentage			10.00%
Cumulative worldwide sales milestone			250,000,000
Intangible assets capitalized			$25,000,000

Commitments_and_Contingencies_3

Commitments and Contingencies (Textual 3 - Fanapt) - Additional Information (Detail) (USD $)	1 Months Ended		3 Months Ended	12 Months Ended		3 Months Ended	12 Months Ended
	Jul. 31, 2013	Feb. 28, 2004	Mar. 31, 2014	Dec. 31, 2006	Dec. 31, 2014	Mar. 31, 2015	Dec. 31, 2009	Dec. 31, 2004
Fanapt
Acquisition of intangible assets	$3,000,000	$500,000	$8,000,000	$1,000,000
Novartis Pharma AG \| Through November 2016
Fanapt
Royalty percentage					23.00%
Novartis Pharma AG \| Royalty Rate for Annual Sales in Excess of $200 million
Fanapt
Future royalty payments to Novartis based on sales					mid-twenties
Novartis Pharma AG \| Beyond November 2016
Fanapt
Royalty percentage					9.00%
Maximum \| Novartis Pharma AG
Fanapt
Possible future milestone payment agreed upon sales threshold					200,000,000
Fanapt
Fanapt
Acquisition of intangible assets			8,000,000				12,000,000	500,000
Future royalty payments to Novartis based on sales						mid-twenties
Upfront payment received							$200,000,000

Commitments_and_Contingencies_4

Commitments and Contingencies (Textual 4 - Tradipitant) - Additional Information (Detail) (Tradipitant, USD $)	3 Months Ended	12 Months Ended
In Millions, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2012
Tradipitant
Future percentage of royalty payments based net sales	Low double digits
Possible future milestone payments		$4
Milestone payment under license agreement		1
License Agreement
Tradipitant
Possible future milestone payments		$95

Legal_Matters_Additional_Infor

Legal Matters - Additional Information (Detail) (Subsequent Event, Roxane Laboratories Inc., Pending Cases)	1 Months Ended
	Apr. 30, 2015
	Case
Subsequent Event \| Roxane Laboratories Inc. \| Pending Cases
Legal Proceedings [Line Items]
Number of cases that were consolidated	2

BlackScholesMerton_Option_Pric

Black-Scholes-Merton Option Pricing Model for Employee and Director Stock Options Granted (Detail) (USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Share Based Payment Award Stock Options Valuation Assumptions [Line Items]
Expected dividend yield	0.00%	0.00%
Weighted average expected volatility	61.00%	66.00%
Weighted average expected term (years)	5 years 11 months 19 days	5 years 10 months 6 days
Weighted average risk-free rate	1.59%	1.79%
Weighted average fair value per share	$6.14	$7.90

Total_Employee_StockBased_Comp

Total Employee Stock-Based Compensation Expense (Detail) (USD $)	3 Months Ended
In Thousands, unless otherwise specified	Mar. 31, 2015	Mar. 31, 2014
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total employee stock-based compensation expense	$1,924	$1,354
Research and development
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total employee stock-based compensation expense	603	442
Selling, general and administrative
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total employee stock-based compensation expense	$1,321	$912

Equity_Incentive_Plans_Textual

Equity Incentive Plans (Textual 1 - Equity Incentive Plan) - Additional Information (Detail)	3 Months Ended
	Mar. 31, 2015	Dec. 31, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of equity incentive plans	2
2004 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Outstanding options granted	594,082	652,810
2006 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Outstanding options granted	6,553,657	6,227,112
Common stock reserved for issuance	11,829,472
2006 Plan \| Outstanding options and RSUs granted (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares subject to outstanding options and RSUs	7,505,463
Shares available for future grant	1,930,220
2006 Plan \| January 1, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for issuance	11,829,472
Increase each January 1 in the number of shares reserved under 2006 Plan as a percentage of common stock outstanding	4.00%
Minimum increase each January 1 in the number of shares reserved	1,500,000
Increase in number of shares reserved and available for future grant	1,500,000

Equity_Incentive_Plans_Textual1

Equity Incentive Plans (Textual 2 Stock Option) - Additional Information (Detail) (USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share based compensation option awards contractual term	10 years
Portion of initial stock options granted to employees that vests on employee's first anniversary	25.00%
Portion of initial stock options granted to employees that vests ratably over three years after completion of first year of service	75.00%
Option awards vesting period, after completion of one year of service	3 years
Vesting period	4 years
Vesting period for initial stock options granted to directors	4 years
Vesting period for subsequent stock options granted to directors	1 year
Unrecognized compensation expenses, weighted average period	2 years 1 month 6 days
Proceeds from exercise of employee stock options	$203,000	$2,447,000
Service option awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expenses	$15,000,000
Unrecognized compensation expenses, weighted average period	1 year 8 months 12 days

Summary_of_Option_Activity_for

Summary of Option Activity for 2004 Plan (Detail) (2004 Plan, USD $)	3 Months Ended	12 Months Ended
In Thousands, except Share data, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
2004 Plan
Number of Shares
Beginning balance	652,810
Expired	0
Exercised	-58,728
Ending balance	594,082	652,810
Exercisable	594,082
Vested and expected to vest at March 31, 2015	594,082
Weighted Average Exercise Price at Grant Date
Beginning balance	$1.74
Expired	$0
Exercised	$1.12
Ending balance	$1.80	$1.74
Exercisable	$1.80
Vested and expected to vest at March 31, 2015	$1.80
Weighted Average Remaining Term (Years)
Weighted Average Remaining Term	6 months 29 days	9 months 11 days
Exercisable	6 months 29 days
Vested and expected to vest at March 31, 2015	6 months 29 days
Aggregate Intrinsic Value
Beginning balance	$8,212
Exercised	590
Ending balance	4,455	8,212
Exercisable	4,455
Vested and expected to vest at March 31, 2015	$4,455

Summary_of_Option_Activity_for1

Summary of Option Activity for 2006 Plan (Detail) (2006 Plan, USD $)	3 Months Ended	12 Months Ended
In Thousands, except Share data, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
2006 Plan
Number of Shares
Beginning balance	6,227,112
Granted	459,000
Forfeited	-89,893
Expired	0
Exercised	-42,562
Ending balance	6,553,657	6,227,112
Exercisable	4,023,610
Vested and expected to vest at March 31, 2015	6,324,233
Weighted Average Exercise Price at Grant Date
Beginning balance	$11.58
Granted	$11.61
Forfeited	$11.39
Expired	$0
Exercised	$4.59
Ending balance	$11.63	$11.58
Exercisable	$12.22
Vested and expected to vest at March 31, 2015	$11.63
Weighted Average Remaining Term (Years)
Weighted Average Remaining Term	6 years 7 months 28 days	6 years 8 months 16 days
Exercisable	5 years 1 month 17 days
Vested and expected to vest at March 31, 2015	6 years 6 months 22 days
Aggregate Intrinsic Value
Beginning balance	$28,523
Exercised	254
Ending balance	8,878	28,523
Exercisable	6,788
Vested and expected to vest at March 31, 2015	$8,835

Equity_Incentive_Plans_Textual2

Equity Incentive Plans (Textual 3 RSU) - Additional Information (Detail) (USD $)	3 Months Ended
In Millions, except Share data, unless otherwise specified	Mar. 31, 2015
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period of RSU awards in equal installments	4 years
Unrecognized compensation expenses, weighted average period	2 years 1 month 6 days
Fair value of common stock vested	$1.80
2006 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value of common stock vested, shares	231,093
Restricted Stock Units (RSU)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expenses related to unvested RSUs	$9.60

Summary_of_RSU_Activity_for_20

Summary of RSU Activity for 2006 Plan (Detail) (2006 Plan, USD $)	3 Months Ended
	Mar. 31, 2015
2006 Plan
Number of Shares Unvested
Beginning balance	1,025,961
Granted	188,000
Forfeited	-31,062
Vested	-231,093
Ending balance	951,806
Weighted Average Price/Share Unvested
Beginning balance	$9.94
Granted	$11.64
Forfeited	$11.33
Vested	$7.96
Ending balance	$10.71