Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Jan. 31, 2016 | Jun. 30, 2015 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2015 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | VNDA | ||
Entity Registrant Name | Vanda Pharmaceuticals Inc. | ||
Entity Central Index Key | 1,347,178 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 43,102,957 | ||
Entity Public Float | $ 525.7 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 50,843 | $ 60,901 |
Marketable securities | 92,337 | 68,921 |
Accounts receivable, net | 16,331 | 3,654 |
Inventory | 1,294 | 5,170 |
Prepaid expenses and other current assets | 5,742 | 3,084 |
Total current assets | 166,547 | 141,730 |
Property and equipment, net | 4,570 | 2,437 |
Intangible assets, net | 38,752 | 26,724 |
Non-current inventory and other | 3,181 | 813 |
Total assets | 213,050 | 171,704 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 15,767 | 7,291 |
Accrued government and other rebates | 35,550 | 495 |
Total current liabilities | 51,317 | 7,786 |
Milestone obligation under license agreement | 25,000 | |
Other non-current liabilities | 3,706 | 3,101 |
Total liabilities | $ 80,023 | $ 10,887 |
Commitments and contingencies (Notes 13 and 18) | ||
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; 42,815,291 and 41,486,361 shares issued and outstanding at December 31, 2015 and December 31, 2014, respectively | $ 43 | $ 41 |
Additional paid-in capital | 460,794 | 448,744 |
Accumulated other comprehensive income | 39 | 16 |
Accumulated deficit | (327,849) | (287,984) |
Total stockholders' equity | 133,027 | 160,817 |
Total liabilities and stockholders' equity | $ 213,050 | $ 171,704 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2015 | Dec. 31, 2014 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
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 | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 42,815,291 | 41,486,361 |
Common stock, shares outstanding | 42,815,291 | 41,486,361 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Revenues: | |||
Net product sales | $ 109,925 | $ 12,909 | |
Royalty revenue | 6,502 | $ 7,090 | |
Licensing agreement | 30,746 | 26,789 | |
Total revenues | 109,925 | 50,157 | 33,879 |
Operating expenses: | |||
Cost of goods sold | 23,462 | 1,583 | |
Research and development | 29,145 | 19,230 | 28,502 |
Selling, general and administrative | 84,531 | 84,644 | 25,082 |
Intangible asset amortization | 12,972 | 2,254 | 1,495 |
Gain on arbitration settlement | (77,616) | ||
Total operating expenses | 150,110 | 30,095 | 55,079 |
Income (loss) from operations | (40,185) | 20,062 | (21,200) |
Other income | 320 | 124 | 145 |
Net income (loss) | $ (39,865) | $ 20,186 | $ (21,055) |
Net income (loss) per share: | |||
Basic | $ (0.94) | $ 0.58 | $ (0.69) |
Diluted | $ (0.94) | $ 0.55 | $ (0.69) |
Weighted average shares outstanding: | |||
Basic | 42,250,254 | 34,774,163 | 30,351,353 |
Diluted | 42,250,254 | 36,686,723 | 30,351,353 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Net income (loss) | $ (39,865) | $ 20,186 | $ (21,055) |
Other comprehensive income (loss): | |||
Change in net unrealized gain (loss) on marketable securities | 23 | (5) | 11 |
Tax provision on other comprehensive income (loss) | 0 | 0 | 0 |
Other comprehensive income (loss), net of tax | 23 | (5) | 11 |
Comprehensive income (loss) | $ (39,842) | $ 20,181 | $ (21,044) |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Other Comprehensive Income (Loss) | Accumulated Deficit |
Beginning balance (in shares) at Dec. 31, 2012 | 28,241,743 | ||||
Beginning balance at Dec. 31, 2012 | $ 9,905 | $ 28 | $ 296,982 | $ 10 | $ (287,115) |
Net proceeds from public offering of common stock (in shares) | 4,680,000 | ||||
Net proceeds from public offering of common stock | 48,505 | $ 5 | 48,500 | ||
Issuance of common stock from the exercise of stock options and settlement of restricted stock units (in shares) | 466,320 | ||||
Issuance of common stock from the exercise of stock options and settlement of restricted stock units | 1,550 | 1,550 | |||
Shares withheld upon settlement of equity awards(in shares) | (49,520) | ||||
Shares withheld upon settlement of equity awards | (196) | (196) | |||
Stock-based compensation expense | 5,404 | 5,404 | |||
Net income (loss) | (21,055) | (21,055) | |||
Other comprehensive income, net of tax | 11 | 11 | |||
Ending balance (in shares) at Dec. 31, 2013 | 33,338,543 | ||||
Ending balance at Dec. 31, 2013 | 44,124 | $ 33 | 352,240 | 21 | (308,170) |
Net proceeds from public offering of common stock (in shares) | 5,750,000 | ||||
Net proceeds from public offering of common stock | 62,313 | $ 5 | 62,308 | ||
Issuance of common stock to Novartis Pharma AG (in shares) | 1,808,973 | ||||
Issuance of common stock to Novartis Pharma AG | 25,905 | $ 2 | 25,903 | ||
Issuance of common stock from the exercise of stock options and settlement of restricted stock units (in shares) | 621,231 | ||||
Issuance of common stock from the exercise of stock options and settlement of restricted stock units | 2,852 | $ 1 | 2,851 | ||
Shares withheld upon settlement of equity awards(in shares) | (32,386) | ||||
Shares withheld upon settlement of equity awards | (436) | (436) | |||
Stock-based compensation expense | 5,878 | 5,878 | |||
Net income (loss) | 20,186 | 20,186 | |||
Other comprehensive income, net of tax | $ (5) | (5) | |||
Ending balance (in shares) at Dec. 31, 2014 | 41,486,361 | 41,486,361 | |||
Ending balance at Dec. 31, 2014 | $ 160,817 | $ 41 | 448,744 | 16 | (287,984) |
Issuance of common stock from the exercise of stock options and settlement of restricted stock units (in shares) | 1,353,877 | ||||
Issuance of common stock from the exercise of stock options and settlement of restricted stock units | 4,374 | $ 2 | 4,372 | ||
Shares withheld upon settlement of equity awards(in shares) | (24,947) | ||||
Shares withheld upon settlement of equity awards | (283) | (283) | |||
Stock-based compensation expense | 7,961 | 7,961 | |||
Net income (loss) | (39,865) | (39,865) | |||
Other comprehensive income, net of tax | $ 23 | 23 | |||
Ending balance (in shares) at Dec. 31, 2015 | 42,815,291 | 42,815,291 | |||
Ending balance at Dec. 31, 2015 | $ 133,027 | $ 43 | $ 460,794 | $ 39 | $ (327,849) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Cash flows from operating activities | |||
Net income (loss) | $ (39,865) | $ 20,186 | $ (21,055) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Depreciation of property and equipment | 582 | 530 | 432 |
Stock-based compensation | 7,961 | 5,878 | 5,404 |
Amortization of discounts and premiums on marketable securities | 677 | 174 | 155 |
Intangible asset amortization | 12,972 | 2,254 | 1,495 |
Gain on arbitration settlement | (77,616) | ||
Deferred revenues | (174) | (30,572) | (26,789) |
Other non-cash adjustments | 657 | 239 | 104 |
Changes in assets and liabilities: | |||
Accounts receivable | (12,677) | (1,623) | (863) |
Prepaid expenses and other current assets | (2,558) | (318) | 1,264 |
Inventory | 387 | (2,210) | |
Accounts payable and accrued liabilities | 9,432 | 1,029 | 261 |
Accrued government and other rebates | 35,055 | 495 | |
Net cash provided by (used in) operating activities | 12,449 | (81,554) | (39,592) |
Cash flows from investing activities | |||
Acquisition of intangible assets | (8,000) | ||
Purchases of property and equipment | (2,527) | (769) | (176) |
Purchases of marketable securities | (193,111) | (93,343) | (65,598) |
Proceeds from sale of marketable securities | 999 | 8,948 | |
Maturities of marketable securities | 168,041 | 80,882 | 31,499 |
Change in restricted cash | 245 | ||
Net cash used in investing activities | (26,598) | (12,037) | (34,275) |
Cash flows from financing activities | |||
Net proceeds from offering of common stock | 62,313 | 48,505 | |
Tax obligations paid in connection with settlement of restricted stock units | (283) | (436) | (196) |
Proceeds from exercise of employee stock options | 4,374 | 2,851 | 1,550 |
Net cash provided by financing activities | 4,091 | 89,728 | 49,859 |
Net decrease in cash and cash equivalents | (10,058) | (3,863) | (24,008) |
Cash and cash equivalents | |||
Beginning of year | 60,901 | 64,764 | 88,772 |
End of year | 50,843 | 60,901 | 64,764 |
Non-cash investing and financing activities | |||
Acquisition of intangible asset accrued in non-current liabilities | 25,000 | ||
Intangible asset related to re-acquired right to Fanapt | (15,940) | ||
Inventories | 2,960 | ||
Prepaid services | 91 | ||
Purchases of property and equipment accrued in current liabilities | $ 187 | $ 106 | |
Novartis Pharma AG | |||
Cash flows from financing activities | |||
Net proceeds from offering of common stock | $ 25,000 |
Business Organization and Prese
Business Organization and Presentation | 12 Months Ended |
Dec. 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 novel therapies addressing high unmet medical needs. Vanda commenced its operations in 2003 and the Company’s portfolio includes the following products: • HETLIOZ ® ® ® • Fanapt ® ® Settlement Agreement with Novartis ® • 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. • 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 consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. All intercompany accounts and transactions have been eliminated in consolidation. Reclassifications Certain reclassifications have been made to prior year amounts to conform with current year classifications. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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. Cash and Cash Equivalents For purposes of the consolidated balance sheets and consolidated statements of cash flows, cash equivalents represent highly-liquid investments with a maturity date of three months or less at the date of purchase. Restricted cash of $0.8 million included in current and non-current assets at December 31, 2015 and 2014, respectively, relates to the lease for office space for the Company’s headquarters located in Washington, D.C. Marketable Securities The Company classifies all of its marketable securities as available-for-sale securities. The Company’s investment policy requires the selection of high-quality issuers, with bond ratings of AAA to A1+/P1. Available-for-sale securities are carried at fair market value, with unrealized gains and losses reported as a component of stockholders’ equity in accumulated other comprehensive income/loss. Interest and dividend income is recorded when earned and included in interest income. Premiums and discounts on marketable securities are amortized and accreted, respectively, to maturity and included in interest income. The Company uses the specific identification method in computing realized gains and losses on the sale of investments, which would be included in the consolidated statements of operations when generated. Marketable securities with a maturity of more than one year as of the balance sheet date and which the Company does not intend to sell within the next twelve months are classified as non-current. All other marketable securities are classified as current. 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. Inventory not expected to be consumed within 12 months following the balance sheet date are classified as non-current. Intangible Assets Costs incurred for products not yet approved by the FDA and for which no alternative future use exists are recorded as expense. In the event a product has been approved by the FDA or an alternative future use exists for a product, patent and license costs are capitalized and amortized over the expected patent life of the related product. Milestone payments to the Company’s partners are recognized when it is deemed probable that the milestone event will occur. Property and Equipment Property and equipment are stated at cost less accumulated depreciation. The costs of leasehold improvements funded by or reimbursed by the lessor are capitalized and amortized as leasehold improvements along with a corresponding deferred rent liability. Depreciation of property and equipment is provided on a straight-line basis over the estimated useful lives of the assets. Amortization of leasehold improvements is provided on a straight-line basis over the shorter of their estimated useful life or the lease term. The costs of additions and improvements are capitalized, and repairs and maintenance costs are charged to operations in the period incurred. Upon retirement or disposition of property and equipment, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is reflected in the statement of operations for that period. Accounts Payable and Accrued Liabilities The Company’s management is required to estimate accrued liabilities as part of the process of preparing financial statements. The estimation of accrued liabilities involves identifying services that have been performed on the Company’s behalf, and then estimating the level of service performed and the associated cost incurred for such services as of each balance sheet date in the financial statements. Accrued liabilities include professional service fees, such as lawyers and accountants, contract service fees, such as those under contracts with clinical monitors, data management organizations and investigators in conjunction with clinical trials, fees to contract manufacturers in conjunction with the production of clinical materials, and fees for marketing and other commercialization activities. Pursuant to management’s assessment of the services that have been performed on clinical trials and other contracts, the Company recognizes these expenses as the services are provided. Such management assessments include, but are not limited to: (i) an evaluation by the project manager of the work that has been completed during the period, (ii) measurement of progress prepared internally and/or provided by the third-party service provider, (iii) analyses of data that justify the progress, and (iv) management’s judgment. In the event that the Company does not identify certain costs that have begun to be incurred or the Company under- or over-estimates the level of services performed or the costs of such services, the Company’s reported expenses for such period would be too low or too high. Net Product Sales The Company’s net product sales consist of sales of HETLIOZ ® ® Year Ended December 31, (in thousands) 2015 2014 2013 HETLIOZ ® $ 44,302 $ 12,802 $ — Fanapt ® 65,623 107 — $ 109,925 $ 12,909 $ — 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 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: Chargebacks: Medicare Part D Coverage Gap: Service Fees: Co-payment Assistance: Prompt-pay: Product Returns: The following table summarizes accounts receivable allowance activity as of and for the years ended December 31, 2015, 2014 and 2013. (in thousands) Accounts Allowances Balance at December 31, 2012 $ — Provision related to current period sales — Adjustments for prior period sales — Credits/payments made — Balance at December 31, 2013 $ — Provision related to current period sales 85 Adjustments for prior period sales — Credits/payments made — Balance at December 31, 2014 $ 85 Provision related to current period sales 1,071 Adjustments for prior period sales (85 ) Credits/payments made (12 ) Balance at December 31, 2015 $ 1,059 License Revenue The Company’s license revenues for the years ended December 31, 2014 and 2013 were derived from the amended and restated sublicense agreement with Novartis and include an upfront payment and future milestone and royalty payments. Pursuant to the amended and restated sublicense agreement, Novartis had the right to commercialize and develop Fanapt ® ® ® Settlement Agreement with Novartis Major Customers HETLIOZ ® ® The following table presents each major customer that represented more than 10% of total revenues for the years ended December 31, 2015, 2014 and 2013: Year Ended December 31, Percent of Total Revenues 2015 2014 2013 Novartis -royalty revenue — 13% 21% Novartis -license agreement — 61% 79% Distributor A 17% — — Distributor B 18% — — Distributor C 19% — — Distributor D 14% — — Distributor E 14% — — Distributor F 12% — — The following table presents each major customer that represented more than 10% of accounts receivable, net, as of December 31, 2015 and 2014: December 31, Percent of Accounts Receivable, Net 2015 2014 Novartis -royalty — 42% Distributor A 22% — Distributor B 24% — Distributor C 17% — Distributor D 12% 21% Distributor E 12% 17% Distributor F — 20% Cost of Goods Sold Cost of goods sold includes royalties payable, the cost of inventory sold, manufacturing and supply chain costs and product shipping and handling costs related to U.S. sales of HETLIOZ ® ® Research and Development Expenses Research and development expenses consist primarily of fees for services provided by third parties in connection with the clinical trials, costs of contract manufacturing services, milestone payments, costs of materials used in clinical trials and research and development, costs for regulatory consultants and filings, depreciation of capital resources used to develop products, related facilities costs, and salaries, other employee-related costs and stock-based compensation for research and development personnel. The Company expenses research and development costs as they are incurred for products in the development stage, including manufacturing costs and milestone payments made under license agreements prior to FDA approval. Upon and subsequent to FDA approval, manufacturing and milestone payments related to license agreements are capitalized. Milestone payments are accrued when it is deemed probable that the milestone event will be achieved. Costs related to the acquisition of intellectual property are expensed as incurred if the underlying technology is developed in connection with the Company’s research and development efforts and has no alternative future use. Selling, General and Administrative Expenses Selling, general and administrative expenses consist of salaries, stock-based compensation, facilities and third party expenses. Selling, general and administrative expenses are associated with the activities of the executive, finance, accounting, information technology, business development, commercial support, trade and distribution, sales, marketing, legal, medical affairs and human resource functions. Additionally, selling, general and administrative expenses included an estimate for the annual Patient Protection and Affordable Care fee. 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 restricted stock units (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 years ended December 31, 2015, 2014 and 2013 were as follows: Year Ended December 31, 2015 2014 2013 Expected dividend yield 0 % 0 % 0 % Weighted average expected volatility 60 % 62 % 65 % Weighted average expected term (years) 6.00 5.90 6.03 Weighted average risk-free rate 1.67 % 1.73 % 1.59 % Weighted average fair value per share $ 11.74 $ 6.99 $ 6.10 Stock-based compensation expense recognized for the years ended December 31, 2015, 2014 and 2013 was comprised of the following: Year Ended December 31, (in thousands) 2015 2014 2013 Research and development $ 2,269 $ 1,933 $ 2,166 Selling, general and administrative 5,692 3,945 3,238 $ 7,961 $ 5,878 $ 5,404 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 $3.4 million and $5.0 million for the years ended December 31, 2015 and 2014, respectively. The Company did not incur any advertising expense during the year ended December 31, 2013. Income taxes The Company accounts for income taxes in accordance with the authoritative guidance on accounting for income taxes, which requires companies to account for deferred income taxes using the asset and liability method. Under the asset and liability method, current income tax expense or benefit is the amount of income taxes expected to be payable or refundable for the current year. A deferred income tax asset or liability is recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credits and loss carryforwards. 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 December 31, 2015 and 2014. Tax rate changes are reflected in income during the period such changes are enacted. Changes in ownership may limit the amount of NOL carryforwards that can be utilized in the future to offset taxable income. Certain risks and uncertainties The Company’s products under development require approval from the FDA or other international regulatory agencies prior to commercial sales. There can be no assurance the products will receive the necessary clearance. If the Company is denied clearance or clearance is delayed, it may have a material adverse impact on the Company. The Company’s products are concentrated in rapidly-changing, highly-competitive markets, which are characterized by rapid technological advances, changes in customer requirements and evolving regulatory requirements and industry standards. Any failure by the Company to anticipate or to respond adequately to technological developments in its industry, changes in customer requirements or changes in regulatory requirements or industry standards or any significant delays in the development or introduction of products or services could have a material adverse effect on the Company’s business, operating results and future cash flows. The Company depends on single source suppliers for critical raw materials for manufacturing, as well as other components required for the administration of its products. The loss of these suppliers could delay the clinical trials or prevent or delay commercialization of the products. Concentrations of credit risk Financial instruments, which potentially subject the Company to significant concentrations of credit risk consist primarily of cash, cash equivalents and marketable securities. The Company places its cash, cash equivalents and marketable securities with highly-rated financial institutions. At December 31, 2015, the Company maintained all of its cash, cash equivalents and marketable securities in two financial institutions. Deposits held with these institutions may exceed the amount of insurance provided on such deposits. Generally, these deposits may be redeemed upon demand, and the Company believes there is minimal risk of losses on such balances. Segment information The Company operates in one reporting segment and, accordingly, no segment disclosures are presented herein. Recent accounting pronouncements In November 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2015-17, Balance Sheet Classification of Deferred Taxes. In September 2015, the FASB issued ASU 2015-16, Simplifying the Accounting for Measurement –Period Adjustments In July 2015, the FASB issued ASU 2015-11, Simplifying the Measurement of Inventory, In January 2015, the FASB issued ASU 2015-01, Income Statement-Extraordinary and Unusual Items In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements – Going Concern In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) Revenue from Contracts with Customers (Topic 606) |
Settlement Agreement with Novar
Settlement Agreement with Novartis | 12 Months Ended |
Dec. 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 ® ® ® ® 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 (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 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 ® |
Earnings per Share
Earnings per Share | 12 Months Ended |
Dec. 31, 2015 | |
Earnings per Share | 4. Earnings per Share Basic earnings per share (EPS) is calculated by dividing the net income (loss) by the weighted average number of shares of common stock outstanding. Diluted EPS is computed by dividing the net income (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 income (loss) per share of common stock for the years ended December 31, 2015, 2014, and 2013: Year Ended December 31, (in thousands, except for share and per share amounts) 2015 2014 2013 Numerator: Net income (loss) $ (39,865 ) $ 20,186 $ (21,055 ) Denominator: Weighted average shares outstanding: Basic 42,250,254 34,774,163 30,351,353 Effect of dilutive securities — 1,912,560 — Weighted average shares outstanding: Diluted 42,250,254 36,686,723 30,351,353 Net income (loss) per share, basic and diluted: Basic $ (0.94 ) $ 0.58 $ (0.69 ) Diluted $ (0.94 ) $ 0.55 $ (0.69 ) Antidilutive securities excluded from calculations of diluted net income (loss) per share 5,660,199 3,524,656 4,409,811 The Company incurred a net loss for each of the years ended December 31, 2015 and 2013 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 | 12 Months Ended |
Dec. 31, 2015 | |
Marketable Securities | 5. Marketable Securities The following is a summary of the Company’s available-for-sale marketable securities as of December 31, 2015, all of which have contract maturities of less than one year: December 31, 2015 (in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Market Value U.S. Treasury and government agencies $ 44,059 $ 6 $ (8 ) $ 44,057 Corporate debt 48,239 46 (5 ) 48,280 $ 92,298 $ 52 $ (13 ) $ 92,337 The following is a summary of the Company’s available-for-sale marketable securities as of December 31, 2014: December 31, 2014 (in thousands) Amortized Gross Gross Fair 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 | 12 Months Ended |
Dec. 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 December 31, 2015 and 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 years ended December 31, 2015 and 2014. As of December 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 December 31, 2015 Using (in thousands) December 31, Quoted Prices in Significant Other Significant (Level 3) Available-for-sale securities: U.S. Treasury and government agencies $ 44,057 $ 44,057 $ — $ — Corporate debt 48,280 — 48,280 $ 92,337 $ 44,057 $ 48,280 $ — 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 (Level 3) Available-for-sale securities: U.S. Treasury and government agencies $ 30,618 $ 30,618 $ — $ — Corporate debt 38,303 — 38,303 $ 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 | 12 Months Ended |
Dec. 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 levels are evaluated for the amount of inventory that would be sold within one year. At certain times, the level of inventory can exceed the forecasted level of cost of goods sold for the next twelve months. The Company classifies the estimate of such inventory as non-current. Inventory consisted of the following as of December 31, 2015 and 2014: December 31, December 31, (in thousands) 2015 2014 Current assets Raw materials $ — $ 198 Work-in-process — 1,326 Finished goods 1,294 3,394 Deferred cost of goods sold — 252 $ 1,294 $ 5,170 Non-Current assets Raw materials $ 127 $ — Work-in-process 2,369 — $ 2,496 $ — |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 12 Months Ended |
Dec. 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 December 31, 2015 and 2014: December 31, December 31, (in thousands) 2015 2014 Prepaid insurance $ 423 $ 270 Prepaid manufacturing cost 346 358 Other prepaid expenses and vendor advances 4,763 2,302 Other current assets 210 154 $ 5,742 $ 3,084 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2015 | |
Property and Equipment | 9. Property and Equipment The following is a summary of the Company’s property and equipment-at cost, as of December 31, 2015 and 2014: (in thousands) Estimated (Years) December 31, 2015 2014 Computer and other equipment 3 $ 2,046 $ 1,316 Furniture and fixtures 7 1,318 765 Leasehold improvements 11 3,519 2,089 6,883 4,170 Accumulated depreciation and amortization (2,313 ) (1,733 ) $ 4,570 $ 2,437 Depreciation expense for the years ended December 31, 2015, 2014 and 2013 was $0.6 million, $0.5 million and $0.4 million, respectively. |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2015 | |
Intangible Assets | 10. Intangible Assets The following is a summary of the Company’s intangible assets as of December 31, 2015: December 31, 2015 (in thousands) Estimated Useful Gross Carrying Accumulated Net Carrying HETLIOZ ® January 2033 $ 33,000 $ 3,460 $ 29,540 Fanapt ® November 2016 27,941 18,729 9,212 $ 60,941 $ 22,189 $ 38,752 The following is a summary of the Company’s intangible assets as of December 31, 2014: December 31, 2014 (in thousands) Estimated Useful life Gross Carrying Amount Accumulated Amortization Net Carrying 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 ® ® ® ® 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 ® ® ® ® ® ® ® In 2009, the Company announced that the FDA had approved the NDA for Fanapt ® ® Pursuant to the Settlement Agreement, Novartis transferred all U.S. and Canadian rights in the Fanapt ® ® ® ® ® Settlement Agreement with Novartis The intangible assets are being amortized over their estimated useful economic life using the straight line method. Total amortization expense was $13.0 million, $2.3 million and $1.5 million for the years ended December 31, 2015, 2014 and 2013, respectively. The following is a summary of the future intangible asset amortization schedule as of December 31, 2015: (in thousands) Total 2016 2017 2018 2019 2020 Thereafter HETLIOZ ® $ 29,540 $ 1,721 $ 1,721 $ 1,721 $ 1,721 $ 1,721 $ 20,935 Fanapt ® 9,212 9,212 — — — — — $ 38,752 $ 10,933 $ 1,721 $ 1,721 $ 1,721 $ 1,721 $ 20,935 |
Accounts Payable and Accrued Li
Accounts Payable and Accrued Liabilities | 12 Months Ended |
Dec. 31, 2015 | |
Accounts Payable and Accrued Liabilities | 11. Accounts Payable and Accrued Liabilities The following is a summary of the Company’s accounts payable and accrued liabilities as of December 31, 2015 and 2014: (in thousands) December 31, December 31, Research and development expenses $ 3,199 $ 1,759 Consulting and other professional fees 5,088 2,522 Compensation and employee benefits 468 388 Royalties payable 5,328 602 Other 1,684 2,020 $ 15,767 $ 7,291 |
Deferred Licensing Revenue
Deferred Licensing Revenue | 12 Months Ended |
Dec. 31, 2015 | |
Deferred Licensing Revenue | 12. Deferred Licensing Revenue The following is a summary of changes in deferred licensing revenue for the years ended December 31, 2014 and 2013: Year Ended December 31, (in thousands) 2015 2014 2013 Balance beginning of year $ — $ 90,275 $ 117,064 Licensing revenue recognized — (30,746) (26,789) Recognized as part of gain on arbitration settlement — (59,529) — Balance end of year $ — $ — $ 90,275 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 ® ® ® Settlement Agreement with Novartis |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 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 December 31, 2015: Cash payments due by year (1) (2) (3) (in thousands) Total 2016 2017 2018 2019 2020 Thereafter Operating leases $ 13,315 $ 1,500 $ 1,538 $ 1,576 $ 1,616 $ 1,656 $ 5,429 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, which was subsequently amended in 2014, with Square 54 Office Owner LLC (Landlord) for its headquarters, consisting of a total of 30,260 square feet of office space at 2200 Pennsylvania Avenue, N.W. in Washington, D.C. (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 its expiration. 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. The Landlord provided the Company with a cash allowance of $0.8 million for tenant improvements. The allowance for tenant improvements is reflected in the consolidated financial statements as an increase to the deferred rent liability for the year ended December 31, 2015. Rent expense under operating leases, was $1.9 million, $1.7 million and $1.1 million for the years ended December 31, 2015, 2014 and 2013, 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 ® . ® ® ® ® ® ® ® ® ® ® ® ® 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 ® ® Either party may terminate the HETLIOZ ® Fanapt ® . ® A predecessor company of Sanofi, Hoechst Marion Roussel, Inc. (HMRI) discovered Fanapt ® ® ® ® ® ® ® ® ® ® Pursuant to the terms of the Settlement Agreement, Novartis transferred all U.S. and Canadian rights in the Fanapt ® ® Settlement Agreement with Novartis ® The Company has entered into agreements with the following partners for the commercialization of Fanapt ® Country Partner Market Approval Date Mexico Probiomed S.A. de C.V. October 2013 Israel Megapharm Ltd. August 2012 Tradipitant. 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. 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. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2015 | |
Income Taxes | 14. Income Taxes Deferred tax assets are reduced by a tax 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 tax valuation allowance against all deferred tax assets as of and December 31, 2015 and 2014. As a result of the tax valuation allowance against deferred tax assets, there was no provision for income taxes for the years ended December 31, 2015, 2014 and 2013. The following is reconciliation between the Company’s statutory tax rate and effective tax rate for the years ended December 31, 2015, 2014 and 2013: Year Ended December 31, 2015 2014 2013 Federal tax at statutory rate 35.0 % 34.0 % -34.0 % State taxes -0.1 % 7.2 % -4.0 % Change in valuation allowance -25.4 % -59.7 % 43.9 % Research and development credit 1.5 % 1.3 % -1.1 % Orphan drug credit 1.6 % 8.5 % -22.7 % Section 162(m) limitation -5.7 % 1.1 % 1.2 % Tax rate change -0.3 % 4.8 % -0.3 % Change in State NOLs -1.4 % 0.0 % 18.5 % Non-deductible stock-based compensation -5.1 % 0.0 % 0.0 % Other non-deductible items -0.1 % 2.8 % -1.5 % Effective tax rate 0.0 % 0.0 % 0.0 % As of December 31, 2015, the Company has early adopted the balance sheet reclassification of all current deferred taxes to non-current deferred taxes. The Company has presented this information prospectively; therefore, prior periods were not retrospectively adjusted. The following is a summary of the components of the Company’s deferred tax assets, net, and the related tax valuation allowance as of December 31, 2015 and 2014: December 31, (in thousands) 2015 2014 Deferred tax assets: Net operating loss carry forwards $ 86,640 $ 73,626 Stock-based compensation 12,919 17,160 Accrued and deferred expenses 1,443 532 Research and development and orphan drug credit carryforwards 38,333 36,772 Other 802 806 Total deferred tax assets 140,137 128,896 Deferred tax liabilities: Other (1,100 ) (6 ) Total deferred tax liabilities (1,100 ) (6 ) Deferred tax assets, net 139,037 128,890 Valuation allowance (139,037 ) (128,890 ) Net deferred tax assets $ — $ — The following is a summary of changes in the Company’s tax valuation allowance for the years ended December 31, 2015, 2014 and 2013: (in thousands) Balance at Additions Charged to Tax Expense Reductions Credited to Tax Expense Balance at End of Year Year Ended: December 31, 2015 $ 128,890 $ 17,002 $ (6,855 ) 139,037 December 31, 2014 141,150 27,893 (40,153 ) 128,890 December 31, 2013 133,271 22,998 (15,119 ) 141,150 As of December 31, 2015, the Company had federal and state NOL carryforwards of $232.6 million, including $6.5 million of gross excess windfall benefits generated from stock-based compensation from which the tax benefit would be recorded to Additional Paid in Capital if realized. As of December 31, 2015, the Company also had research and development credits of $6.8 million and orphan drug carryforward credits of $31.6 million. These NOL carryforwards and credits will begin to expire in 2028 and 2024, respectively. Because the Company has generated NOLs from inception through December, 31, 2015, all income tax returns filed by the Company are open to examination by tax jurisdictions. As of December 31, 2015, the Company’s income tax returns have not been under examination by any federal or state tax jurisdictions. As of December 31, 2015 and 2014, the Company had no uncertain tax positions. Certain tax attributes of the Company, including NOLs and credits, are subject to any ownership change as defined under IRC Section 382, A change in ownership could affect the Company’s ability to use NOLs and credit carryforward (tax attributes). 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 Internal Revenue Code of 1986, as amended (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. Additionally, the Company maintains a valuation allowance on its tax attributes, therefore, any IRC Section 382 limitation would not have a material impact on the Company’s provision for income taxes as of December 31, 2015. |
Public Offering of Common Stock
Public Offering of Common Stock | 12 Months Ended |
Dec. 31, 2015 | |
Public Offering of Common Stock | 15. Public Offering of Common Stock In October 2014, the Company completed a public offering of 5,750,000 shares of common stock at a price to the public of $11.60 per share. Net cash proceeds from the public offering were $62.3 million, after deducting the underwriting discounts and commissions and offering expenses. In August 2013, the Company completed a public offering of 4,680,000 shares of common stock at a price to the public of $11.14 per share. Net cash proceeds from the 2013 public offering were $48.5 million, after deducting the underwriting discounts and commissions and offering expenses. |
Equity Incentive Plans
Equity Incentive Plans | 12 Months Ended |
Dec. 31, 2015 | |
Equity Incentive Plans | 16. Equity Incentive Plans During the year ended December 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. There were no shares subject to outstanding options granted under the 2004 Plan as of December 31, 2015, and no additional options will be granted under the 2004 Plan. As of December 31, 2015, there were 11,829,472 shares of the Company’s common stock reserved for issuance under the 2006 Plan, of which 7,275,129 shares were subject to outstanding options and RSUs and 1,733,142 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, 2016, 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 13,329,472 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 December 31, 2015, $12.6 million of unrecognized compensation costs related to unvested service option awards are expected to be recognized over a weighted average period of 1.4 years. No option awards are classified as a liability as of December 31, 2015. The following is a summary of option activity for the 2004 Plan for the years ended December 31, 2015, 2014, and 2013: 2004 Option Plan (in thousands, except for share and per share amounts) Number of Weighted Average Weighted Average Aggregate Outstanding at December 31, 2012 672,145 $ 1.79 2.78 $ 1,512 Exercised (115 ) 4.73 Expired (1,286 ) 3.67 Outstanding at December 31, 2013 670,744 1.79 1.78 7,124 Exercised (17,934 ) 3.57 Outstanding at December 31, 2014 652,810 1.74 0.78 8,212 Exercised (652,810 ) 1.74 6,129 Outstanding at December 31, 2015 — The following is a summary of option activity for the 2006 Plan for the years ended December 31, 2015, 2014, and 2013: 2006 Option Plan (in thousands, except for share and per share amounts) Number of Weighted Average Weighted Average Aggregate Outstanding at December 31, 2012 4,865,487 $ 10.83 7.15 $ 634 Granted 1,245,500 10.18 Forfeited (54,226 ) 6.14 Expired (259,295 ) 10.65 Exercised (263,848 ) 5.86 1,545 Outstanding at December 31, 2013 5,533,618 10.98 6.93 21,264 Granted 1,324,337 12.17 Forfeited (237,108 ) 8.35 Exercised (393,735 ) 7.08 2,923 Outstanding at December 31, 2014 6,227,112 11.58 6.71 28,523 Granted 1,056,500 11.74 Forfeited (496,854 ) 10.75 Expired (64,336 ) 25.69 Exercised (469,974 ) 7.02 2,594 Outstanding at December 31, 2015 6,252,448 11.87 6.16 7,498 Exercisable at December 31, 2015 4,163,690 12.11 4.86 6,616 Vested and expected to vest at December 31, 2015 6,120,365 11.87 6.10 7,491 Proceeds from the exercise of stock options amounted to $4.4 million, $2.9 million and $1.6 million for the years ended December 31, 2015, 2014 and 2013, respectively. 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 December 31, 2015, $8.5 million of unrecognized compensation costs related to unvested service RSUs are expected to be recognized over a weighted average period of 2.0 years. No service RSUs are classified as a liability as of December 31, 2015. The following is a summary of RSU activity for the 2006 Plan for the years ended December 31, 2015, 2014, and 2013: RSUs Number of Weighted Unvested at December 31, 2012 705,376 $ 5.91 Granted 400,500 10.29 Forfeited (21,000 ) 6.41 Vested (201,186 ) 6.71 Unvested at December 31, 2013 883,690 7.70 Granted 436,115 12.28 Forfeited (84,282 ) 6.75 Vested (209,562 ) 6.67 Unvested at December 31, 2014 1,025,961 9.94 Granted 417,000 11.51 Forfeited (189,187 ) 10.60 Vested (231,093 ) 7.96 Unvested at December 31, 2015 1,022,681 10.90 The grant date fair value for the 231,093 shares underlying RSUs that vested during the year ended December 31, 2015 was $1.8 million. |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2015 | |
Employee Benefit Plan | 17. Employee Benefit Plan The Company has a defined contribution plan under IRC Section 401(k). This plan covers substantially all employees who meet minimum age and service requirements and allows participants to defer a portion of their annual compensation on a pre-tax basis. Currently, the Company matches 50 percent up to the first six percent of employee contributions. All matching contributions have been paid by the Company. The Company match vests over a four year period. The total Company match was $0.3 million, $0.2 million and $0.2 million for the years ended December 31, 2015, 2014 and 2013, respectively. |
Legal Matters
Legal Matters | 12 Months Ended |
Dec. 31, 2015 | |
Legal Matters | 18. 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 ‘610 Patent) by submitting to the FDA an Abbreviated New Drug Application (ANDA) for generic versions of Fanapt ® ® 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 filed a lawsuit against Inventia Healthcare Pvt. Ltd. (Inventia) in the U.S. District Court for the District of Delaware. The suit seeks an adjudication that Inventia has infringed on one or more claims of the ‘610 Patent by submitting to the FDA an ANDA for a generic version of Fanapt ® ® In October 2015, the Company filed four separate patent infringement lawsuits in the United States District Court for the District of Delaware (the October 2015 Lawsuits). Two of the October 2015 Lawsuits join the existing litigations against the previous Fanapt ® The first of the October 2015 Lawsuits, which was filed against Roxane, seeks an adjudication that Roxane has infringed one or more claims of the Company’s U.S. Patent No. 9,138,432 (the ‘432 Patent) by submitting to the FDA its ANDA for a generic version of Fanapt ® ® The second of the October 2015 Lawsuits, which was filed against Inventia, seeks an adjudication that Inventia has infringed one or more claims of the ‘432 Patent by submitting to the FDA its ANDA for a generic version of Fanapt ® ® The third of the October 2015 Lawsuits, which was filed against Taro, seeks an adjudication that Taro has infringed one or more claims of the ‘432 Patent and the ‘610 Patent by submitting to the FDA an ANDA for a generic version of Fanapt ® ® The fourth of the October 2015 Lawsuits, which was filed against Apotex and Apotex Corp., seeks an adjudication that Apotex has infringed one or more claims of the ‘432 Patent and the ‘610 Patent by submitting to the FDA an ANDA for a generic version of Fanapt ® ® In November 2015, the Company filed a patent infringement lawsuit in the United States District Court for the District of Delaware against Lupin Limited and Lupin Pharmaceuticals, Inc. (collectively, Lupin). The suit seeks an adjudication that Lupin has infringed one or more claims of the ‘432 Patent and the ‘610 Patent by submitting to the FDA its ANDA for a generic version of Fanapt ® ® |
Quarterly Financial Data (unaud
Quarterly Financial Data (unaudited) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Data (unaudited) | 19. Quarterly Financial Data (unaudited) First Second Third Fourth (in thousands, except for per share amounts) Quarter Quarter Quarter Quarter 2015 Revenue $ 22,150 $ 27,582 $ 28,344 $ 31,849 Gross profit 17,135 21,816 21,834 25,678 Loss from operations (10,293 ) (5,458 ) (9,541 ) (14,893 ) Net loss (10,221 ) (5,386 ) (9,461 ) (14,798 ) Net loss per share, basic and diluted $ (0.24 ) $ (0.13 ) $ (0.22 ) $ (0.35 ) 2014 Revenue $ 9,143 $ 10,862 $ 14,782 $ 15,370 Gross profit 9,143 10,664 14,079 14,688 Income (loss) from operations (26,578 ) (21,606 ) (1,448 ) 69,693 Net income (loss) (26,533 ) (21,575 ) (1,426 ) 69,719 Net income (loss) per share: Basic $ (0.79 ) $ (0.64 ) $ (0.04 ) $ 1.85 Diluted $ (0.79 ) $ (0.64 ) $ (0.04 ) $ 1.77 The Company’s results for the fourth quarter of 2014 include a gain on arbitration settlement of $77.6 million, or $2.06 and $1.97 per basic and diluted share, respectively. See Note 3, Settlement Agreement with Novartis |
Business Organization and Pre27
Business Organization and Presentation (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Business organization | Business organization Vanda Pharmaceuticals Inc. (Vanda or the Company) is a biopharmaceutical company focused on the development and commercialization of novel therapies addressing high unmet medical needs. Vanda commenced its operations in 2003 and the Company’s portfolio includes the following products: • HETLIOZ ® ® ® • Fanapt ® ® Settlement Agreement with Novartis ® • 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. • 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 consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. All intercompany accounts and transactions have been eliminated in consolidation. |
Reclassifications | Reclassifications Certain reclassifications have been made to prior year amounts to conform with current year classifications. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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. |
Cash and Cash Equivalents | Cash and Cash Equivalents For purposes of the consolidated balance sheets and consolidated statements of cash flows, cash equivalents represent highly-liquid investments with a maturity date of three months or less at the date of purchase. Restricted cash of $0.8 million included in current and non-current assets at December 31, 2015 and 2014, respectively, relates to the lease for office space for the Company’s headquarters located in Washington, D.C. |
Marketable Securities | Marketable Securities The Company classifies all of its marketable securities as available-for-sale securities. The Company’s investment policy requires the selection of high-quality issuers, with bond ratings of AAA to A1+/P1. Available-for-sale securities are carried at fair market value, with unrealized gains and losses reported as a component of stockholders’ equity in accumulated other comprehensive income/loss. Interest and dividend income is recorded when earned and included in interest income. Premiums and discounts on marketable securities are amortized and accreted, respectively, to maturity and included in interest income. The Company uses the specific identification method in computing realized gains and losses on the sale of investments, which would be included in the consolidated statements of operations when generated. Marketable securities with a maturity of more than one year as of the balance sheet date and which the Company does not intend to sell within the next twelve months are classified as non-current. All other marketable securities are classified as current. |
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. Inventory not expected to be consumed within 12 months following the balance sheet date are classified as non-current. |
Intangible Assets | Intangible Assets Costs incurred for products not yet approved by the FDA and for which no alternative future use exists are recorded as expense. In the event a product has been approved by the FDA or an alternative future use exists for a product, patent and license costs are capitalized and amortized over the expected patent life of the related product. Milestone payments to the Company’s partners are recognized when it is deemed probable that the milestone event will occur. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost less accumulated depreciation. The costs of leasehold improvements funded by or reimbursed by the lessor are capitalized and amortized as leasehold improvements along with a corresponding deferred rent liability. Depreciation of property and equipment is provided on a straight-line basis over the estimated useful lives of the assets. Amortization of leasehold improvements is provided on a straight-line basis over the shorter of their estimated useful life or the lease term. The costs of additions and improvements are capitalized, and repairs and maintenance costs are charged to operations in the period incurred. Upon retirement or disposition of property and equipment, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is reflected in the statement of operations for that period. |
Accounts Payable and Accrued Liabilities | Accounts Payable and Accrued Liabilities The Company’s management is required to estimate accrued liabilities as part of the process of preparing financial statements. The estimation of accrued liabilities involves identifying services that have been performed on the Company’s behalf, and then estimating the level of service performed and the associated cost incurred for such services as of each balance sheet date in the financial statements. Accrued liabilities include professional service fees, such as lawyers and accountants, contract service fees, such as those under contracts with clinical monitors, data management organizations and investigators in conjunction with clinical trials, fees to contract manufacturers in conjunction with the production of clinical materials, and fees for marketing and other commercialization activities. Pursuant to management’s assessment of the services that have been performed on clinical trials and other contracts, the Company recognizes these expenses as the services are provided. Such management assessments include, but are not limited to: (i) an evaluation by the project manager of the work that has been completed during the period, (ii) measurement of progress prepared internally and/or provided by the third-party service provider, (iii) analyses of data that justify the progress, and (iv) management’s judgment. In the event that the Company does not identify certain costs that have begun to be incurred or the Company under- or over-estimates the level of services performed or the costs of such services, the Company’s reported expenses for such period would be too low or too high. |
Net Product Sales | Net Product Sales The Company’s net product sales consist of sales of HETLIOZ ® ® Year Ended December 31, (in thousands) 2015 2014 2013 HETLIOZ ® $ 44,302 $ 12,802 $ — Fanapt ® 65,623 107 — $ 109,925 $ 12,909 $ — 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 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: Chargebacks: Medicare Part D Coverage Gap: Service Fees: Co-payment Assistance: Prompt-pay: Product Returns: The following table summarizes accounts receivable allowance activity as of and for the years ended December 31, 2015, 2014 and 2013. (in thousands) Accounts Allowances Balance at December 31, 2012 $ — Provision related to current period sales — Adjustments for prior period sales — Credits/payments made — Balance at December 31, 2013 $ — Provision related to current period sales 85 Adjustments for prior period sales — Credits/payments made — Balance at December 31, 2014 $ 85 Provision related to current period sales 1,071 Adjustments for prior period sales (85 ) Credits/payments made (12 ) Balance at December 31, 2015 $ 1,059 License Revenue The Company’s license revenues for the years ended December 31, 2014 and 2013 were derived from the amended and restated sublicense agreement with Novartis and include an upfront payment and future milestone and royalty payments. Pursuant to the amended and restated sublicense agreement, Novartis had the right to commercialize and develop Fanapt ® ® ® Settlement Agreement with Novartis |
Major Customers | Major Customers HETLIOZ ® ® The following table presents each major customer that represented more than 10% of total revenues for the years ended December 31, 2015, 2014 and 2013: Year Ended December 31, Percent of Total Revenues 2015 2014 2013 Novartis -royalty revenue — 13% 21% Novartis -license agreement — 61% 79% Distributor A 17% — — Distributor B 18% — — Distributor C 19% — — Distributor D 14% — — Distributor E 14% — — Distributor F 12% — — The following table presents each major customer that represented more than 10% of accounts receivable, net, as of December 31, 2015 and 2014: December 31, Percent of Accounts Receivable, Net 2015 2014 Novartis -royalty — 42% Distributor A 22% — Distributor B 24% — Distributor C 17% — Distributor D 12% 21% Distributor E 12% 17% Distributor F — 20% |
Cost of Goods Sold | Cost of Goods Sold Cost of goods sold includes royalties payable, the cost of inventory sold, manufacturing and supply chain costs and product shipping and handling costs related to U.S. sales of HETLIOZ ® ® |
Research and Development Expenses | Research and Development Expenses Research and development expenses consist primarily of fees for services provided by third parties in connection with the clinical trials, costs of contract manufacturing services, milestone payments, costs of materials used in clinical trials and research and development, costs for regulatory consultants and filings, depreciation of capital resources used to develop products, related facilities costs, and salaries, other employee-related costs and stock-based compensation for research and development personnel. The Company expenses research and development costs as they are incurred for products in the development stage, including manufacturing costs and milestone payments made under license agreements prior to FDA approval. Upon and subsequent to FDA approval, manufacturing and milestone payments related to license agreements are capitalized. Milestone payments are accrued when it is deemed probable that the milestone event will be achieved. Costs related to the acquisition of intellectual property are expensed as incurred if the underlying technology is developed in connection with the Company’s research and development efforts and has no alternative future use. |
Selling, General and Administrative Expenses | Selling, General and Administrative Expenses Selling, general and administrative expenses consist of salaries, stock-based compensation, facilities and third party expenses. Selling, general and administrative expenses are associated with the activities of the executive, finance, accounting, information technology, business development, commercial support, trade and distribution, sales, marketing, legal, medical affairs and human resource functions. Additionally, selling, general and administrative expenses included an estimate for the annual Patient Protection and Affordable Care fee. |
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 recognizes the expense over the award’s vesting period. The fair value of stock options granted and restricted stock units (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 years ended December 31, 2015, 2014 and 2013 were as follows: Year Ended December 31, 2015 2014 2013 Expected dividend yield 0 % 0 % 0 % Weighted average expected volatility 60 % 62 % 65 % Weighted average expected term (years) 6.00 5.90 6.03 Weighted average risk-free rate 1.67 % 1.73 % 1.59 % Weighted average fair value per share $ 11.74 $ 6.99 $ 6.10 Stock-based compensation expense recognized for the years ended December 31, 2015, 2014 and 2013 was comprised of the following: Year Ended December 31, (in thousands) 2015 2014 2013 Research and development $ 2,269 $ 1,933 $ 2,166 Selling, general and administrative 5,692 3,945 3,238 $ 7,961 $ 5,878 $ 5,404 |
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 $3.4 million and $5.0 million for the years ended December 31, 2015 and 2014, respectively. The Company did not incur any advertising expense during the year ended December 31, 2013. |
Income taxes | Income taxes The Company accounts for income taxes in accordance with the authoritative guidance on accounting for income taxes, which requires companies to account for deferred income taxes using the asset and liability method. Under the asset and liability method, current income tax expense or benefit is the amount of income taxes expected to be payable or refundable for the current year. A deferred income tax asset or liability is recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credits and loss carryforwards. 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 December 31, 2015 and 2014. Tax rate changes are reflected in income during the period such changes are enacted. Changes in ownership may limit the amount of NOL carryforwards that can be utilized in the future to offset taxable income. |
Certain risks and uncertainties | Certain risks and uncertainties The Company’s products under development require approval from the FDA or other international regulatory agencies prior to commercial sales. There can be no assurance the products will receive the necessary clearance. If the Company is denied clearance or clearance is delayed, it may have a material adverse impact on the Company. The Company’s products are concentrated in rapidly-changing, highly-competitive markets, which are characterized by rapid technological advances, changes in customer requirements and evolving regulatory requirements and industry standards. Any failure by the Company to anticipate or to respond adequately to technological developments in its industry, changes in customer requirements or changes in regulatory requirements or industry standards or any significant delays in the development or introduction of products or services could have a material adverse effect on the Company’s business, operating results and future cash flows. The Company depends on single source suppliers for critical raw materials for manufacturing, as well as other components required for the administration of its products. The loss of these suppliers could delay the clinical trials or prevent or delay commercialization of the products. |
Concentrations of credit risk | Concentrations of credit risk Financial instruments, which potentially subject the Company to significant concentrations of credit risk consist primarily of cash, cash equivalents and marketable securities. The Company places its cash, cash equivalents and marketable securities with highly-rated financial institutions. At December 31, 2015, the Company maintained all of its cash, cash equivalents and marketable securities in two financial institutions. Deposits held with these institutions may exceed the amount of insurance provided on such deposits. Generally, these deposits may be redeemed upon demand, and the Company believes there is minimal risk of losses on such balances. |
Segment information | Segment information The Company operates in one reporting segment and, accordingly, no segment disclosures are presented herein. |
Recent accounting pronouncements | Recent accounting pronouncements In November 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2015-17, Balance Sheet Classification of Deferred Taxes. In September 2015, the FASB issued ASU 2015-16, Simplifying the Accounting for Measurement –Period Adjustments In July 2015, the FASB issued ASU 2015-11, Simplifying the Measurement of Inventory, In January 2015, the FASB issued ASU 2015-01, Income Statement-Extraordinary and Unusual Items In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements – Going Concern In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) Revenue from Contracts with Customers (Topic 606) |
Summary of Significant Accoun28
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Net Sales by Product | The Company’s net product sales consist of sales of HETLIOZ ® ® Year Ended December 31, (in thousands) 2015 2014 2013 HETLIOZ ® $ 44,302 $ 12,802 $ — Fanapt ® 65,623 107 — $ 109,925 $ 12,909 $ — |
Summary of Accounts Receivable Allowance Activity | The following table summarizes accounts receivable allowance activity as of and for the years ended December 31, 2015, 2014 and 2013. (in thousands) Accounts Allowances Balance at December 31, 2012 $ — Provision related to current period sales — Adjustments for prior period sales — Credits/payments made — Balance at December 31, 2013 $ — Provision related to current period sales 85 Adjustments for prior period sales — Credits/payments made — Balance at December 31, 2014 $ 85 Provision related to current period sales 1,071 Adjustments for prior period sales (85 ) Credits/payments made (12 ) Balance at December 31, 2015 $ 1,059 |
Schedule of Major Customers that Represented More Than 10% of Total Revenues | The following table presents each major customer that represented more than 10% of total revenues for the years ended December 31, 2015, 2014 and 2013: Year Ended December 31, Percent of Total Revenues 2015 2014 2013 Novartis -royalty revenue — 13% 21% Novartis -license agreement — 61% 79% Distributor A 17% — — Distributor B 18% — — Distributor C 19% — — Distributor D 14% — — Distributor E 14% — — Distributor F 12% — — |
Schedule of Major Customers that Represented More Than 10% of Accounts Receivable, Net | The following table presents each major customer that represented more than 10% of accounts receivable, net, as of December 31, 2015 and 2014: December 31, Percent of Accounts Receivable, Net 2015 2014 Novartis -royalty — 42% Distributor A 22% — Distributor B 24% — Distributor C 17% — Distributor D 12% 21% Distributor E 12% 17% Distributor F — 20% |
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 years ended December 31, 2015, 2014 and 2013 were as follows: Year Ended December 31, 2015 2014 2013 Expected dividend yield 0 % 0 % 0 % Weighted average expected volatility 60 % 62 % 65 % Weighted average expected term (years) 6.00 5.90 6.03 Weighted average risk-free rate 1.67 % 1.73 % 1.59 % Weighted average fair value per share $ 11.74 $ 6.99 $ 6.10 |
Total Employee Stock-Based Compensation Expense | Stock-based compensation expense recognized for the years ended December 31, 2015, 2014 and 2013 was comprised of the following: Year Ended December 31, (in thousands) 2015 2014 2013 Research and development $ 2,269 $ 1,933 $ 2,166 Selling, general and administrative 5,692 3,945 3,238 $ 7,961 $ 5,878 $ 5,404 |
Settlement Agreement with Nov29
Settlement Agreement with Novartis (Tables) | 12 Months Ended |
Dec. 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) | 12 Months Ended |
Dec. 31, 2015 | |
Basic and Diluted Net Income (Loss) Per Share of Common Stock | The following table presents the calculation of basic and diluted net income (loss) per share of common stock for the years ended December 31, 2015, 2014, and 2013: Year Ended December 31, (in thousands, except for share and per share amounts) 2015 2014 2013 Numerator: Net income (loss) $ (39,865 ) $ 20,186 $ (21,055 ) Denominator: Weighted average shares outstanding: Basic 42,250,254 34,774,163 30,351,353 Effect of dilutive securities — 1,912,560 — Weighted average shares outstanding: Diluted 42,250,254 36,686,723 30,351,353 Net income (loss) per share, basic and diluted: Basic $ (0.94 ) $ 0.58 $ (0.69 ) Diluted $ (0.94 ) $ 0.55 $ (0.69 ) Antidilutive securities excluded from calculations of diluted net income (loss) per share 5,660,199 3,524,656 4,409,811 |
Marketable Securities (Tables)
Marketable Securities (Tables) | 12 Months Ended |
Dec. 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 December 31, 2015, all of which have contract maturities of less than one year: December 31, 2015 (in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Market Value U.S. Treasury and government agencies $ 44,059 $ 6 $ (8 ) $ 44,057 Corporate debt 48,239 46 (5 ) 48,280 $ 92,298 $ 52 $ (13 ) $ 92,337 The following is a summary of the Company’s available-for-sale marketable securities as of December 31, 2014: December 31, 2014 (in thousands) Amortized Gross Gross Fair 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) | 12 Months Ended |
Dec. 31, 2015 | |
Assets Measured at Fair Value on Recurring Basis | As of December 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 December 31, 2015 Using (in thousands) December 31, Quoted Prices in Significant Other Significant (Level 3) Available-for-sale securities: U.S. Treasury and government agencies $ 44,057 $ 44,057 $ — $ — Corporate debt 48,280 — 48,280 $ 92,337 $ 44,057 $ 48,280 $ — 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 (Level 3) Available-for-sale securities: U.S. Treasury and government agencies $ 30,618 $ 30,618 $ — $ — Corporate debt 38,303 — 38,303 $ 68,921 $ 30,618 $ 38,303 $ — |
Inventory (Tables)
Inventory (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Inventory | Inventory consisted of the following as of December 31, 2015 and 2014: December 31, December 31, (in thousands) 2015 2014 Current assets Raw materials $ — $ 198 Work-in-process — 1,326 Finished goods 1,294 3,394 Deferred cost of goods sold — 252 $ 1,294 $ 5,170 Non-Current assets Raw materials $ 127 $ — Work-in-process 2,369 — $ 2,496 $ — |
Prepaid Expenses and Other Cu34
Prepaid Expenses and Other Current Assets (Tables) | 12 Months Ended |
Dec. 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 December 31, 2015 and 2014: December 31, December 31, (in thousands) 2015 2014 Prepaid insurance $ 423 $ 270 Prepaid manufacturing cost 346 358 Other prepaid expenses and vendor advances 4,763 2,302 Other current assets 210 154 $ 5,742 $ 3,084 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Property and Equipment-at Cost | The following is a summary of the Company’s property and equipment-at cost, as of December 31, 2015 and 2014: (in thousands) Estimated (Years) December 31, 2015 2014 Computer and other equipment 3 $ 2,046 $ 1,316 Furniture and fixtures 7 1,318 765 Leasehold improvements 11 3,519 2,089 6,883 4,170 Accumulated depreciation and amortization (2,313 ) (1,733 ) $ 4,570 $ 2,437 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Intangible Assets | The following is a summary of the Company’s intangible assets as of December 31, 2015: December 31, 2015 (in thousands) Estimated Useful Gross Carrying Accumulated Net Carrying HETLIOZ ® January 2033 $ 33,000 $ 3,460 $ 29,540 Fanapt ® November 2016 27,941 18,729 9,212 $ 60,941 $ 22,189 $ 38,752 The following is a summary of the Company’s intangible assets as of December 31, 2014: December 31, 2014 (in thousands) Estimated Useful life Gross Carrying Amount Accumulated Amortization Net Carrying 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 December 31, 2015: (in thousands) Total 2016 2017 2018 2019 2020 Thereafter HETLIOZ ® $ 29,540 $ 1,721 $ 1,721 $ 1,721 $ 1,721 $ 1,721 $ 20,935 Fanapt ® 9,212 9,212 — — — — — $ 38,752 $ 10,933 $ 1,721 $ 1,721 $ 1,721 $ 1,721 $ 20,935 |
Accounts Payable and Accrued 37
Accounts Payable and Accrued Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Accounts Payable and Accrued Liabilities | The following is a summary of the Company’s accounts payable and accrued liabilities as of December 31, 2015 and 2014: (in thousands) December 31, December 31, Research and development expenses $ 3,199 $ 1,759 Consulting and other professional fees 5,088 2,522 Compensation and employee benefits 468 388 Royalties payable 5,328 602 Other 1,684 2,020 $ 15,767 $ 7,291 |
Deferred Licensing Revenue (Tab
Deferred Licensing Revenue (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Changes in Deferred Licensing Revenue | The following is a summary of changes in deferred licensing revenue for the years ended December 31, 2014 and 2013: Year Ended December 31, (in thousands) 2015 2014 2013 Balance beginning of year $ — $ 90,275 $ 117,064 Licensing revenue recognized — (30,746) (26,789) Recognized as part of gain on arbitration settlement — (59,529) — Balance end of year $ — $ — $ 90,275 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 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 December 31, 2015: Cash payments due by year (1) (2) (3) (in thousands) Total 2016 2017 2018 2019 2020 Thereafter Operating leases $ 13,315 $ 1,500 $ 1,538 $ 1,576 $ 1,616 $ 1,656 $ 5,429 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Reconciliation Between Statutory Tax Rate and Effective Tax Rate | The following is reconciliation between the Company’s statutory tax rate and effective tax rate for the years ended December 31, 2015, 2014 and 2013: Year Ended December 31, 2015 2014 2013 Federal tax at statutory rate 35.0 % 34.0 % -34.0 % State taxes -0.1 % 7.2 % -4.0 % Change in valuation allowance -25.4 % -59.7 % 43.9 % Research and development credit 1.5 % 1.3 % -1.1 % Orphan drug credit 1.6 % 8.5 % -22.7 % Section 162(m) limitation -5.7 % 1.1 % 1.2 % Tax rate change -0.3 % 4.8 % -0.3 % Change in State NOLs -1.4 % 0.0 % 18.5 % Non-deductible stock-based compensation -5.1 % 0.0 % 0.0 % Other non-deductible items -0.1 % 2.8 % -1.5 % Effective tax rate 0.0 % 0.0 % 0.0 % |
Components of Deferred Tax Assets, Net, and Related Valuation Allowance | The following is a summary of the components of the Company’s deferred tax assets, net, and the related tax valuation allowance as of December 31, 2015 and 2014: December 31, (in thousands) 2015 2014 Deferred tax assets: Net operating loss carry forwards $ 86,640 $ 73,626 Stock-based compensation 12,919 17,160 Accrued and deferred expenses 1,443 532 Research and development and orphan drug credit carryforwards 38,333 36,772 Other 802 806 Total deferred tax assets 140,137 128,896 Deferred tax liabilities: Other (1,100 ) (6 ) Total deferred tax liabilities (1,100 ) (6 ) Deferred tax assets, net 139,037 128,890 Valuation allowance (139,037 ) (128,890 ) Net deferred tax assets $ — $ — |
Summary of Changes in Tax Valuation Allowance | The following is a summary of changes in the Company’s tax valuation allowance for the years ended December 31, 2015, 2014 and 2013: (in thousands) Balance at Additions Charged to Tax Expense Reductions Credited to Tax Expense Balance at End of Year Year Ended: December 31, 2015 $ 128,890 $ 17,002 $ (6,855 ) 139,037 December 31, 2014 141,150 27,893 (40,153 ) 128,890 December 31, 2013 133,271 22,998 (15,119 ) 141,150 |
Equity Incentive Plans (Tables)
Equity Incentive Plans (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Summary of RSU Activity for 2006 Plan | The following is a summary of RSU activity for the 2006 Plan for the years ended December 31, 2015, 2014, and 2013: RSUs Number of Weighted Unvested at December 31, 2012 705,376 $ 5.91 Granted 400,500 10.29 Forfeited (21,000 ) 6.41 Vested (201,186 ) 6.71 Unvested at December 31, 2013 883,690 7.70 Granted 436,115 12.28 Forfeited (84,282 ) 6.75 Vested (209,562 ) 6.67 Unvested at December 31, 2014 1,025,961 9.94 Granted 417,000 11.51 Forfeited (189,187 ) 10.60 Vested (231,093 ) 7.96 Unvested at December 31, 2015 1,022,681 10.90 |
2004 Plan | |
Summary of Option Activity Plan | The following is a summary of option activity for the 2004 Plan for the years ended December 31, 2015, 2014, and 2013: 2004 Option Plan (in thousands, except for share and per share amounts) Number of Weighted Average Weighted Average Aggregate Outstanding at December 31, 2012 672,145 $ 1.79 2.78 $ 1,512 Exercised (115 ) 4.73 Expired (1,286 ) 3.67 Outstanding at December 31, 2013 670,744 1.79 1.78 7,124 Exercised (17,934 ) 3.57 Outstanding at December 31, 2014 652,810 1.74 0.78 8,212 Exercised (652,810 ) 1.74 6,129 Outstanding at December 31, 2015 — |
2006 Plan | |
Summary of Option Activity Plan | The following is a summary of option activity for the 2006 Plan for the years ended December 31, 2015, 2014, and 2013: 2006 Option Plan (in thousands, except for share and per share amounts) Number of Weighted Average Weighted Average Aggregate Outstanding at December 31, 2012 4,865,487 $ 10.83 7.15 $ 634 Granted 1,245,500 10.18 Forfeited (54,226 ) 6.14 Expired (259,295 ) 10.65 Exercised (263,848 ) 5.86 1,545 Outstanding at December 31, 2013 5,533,618 10.98 6.93 21,264 Granted 1,324,337 12.17 Forfeited (237,108 ) 8.35 Exercised (393,735 ) 7.08 2,923 Outstanding at December 31, 2014 6,227,112 11.58 6.71 28,523 Granted 1,056,500 11.74 Forfeited (496,854 ) 10.75 Expired (64,336 ) 25.69 Exercised (469,974 ) 7.02 2,594 Outstanding at December 31, 2015 6,252,448 11.87 6.16 7,498 Exercisable at December 31, 2015 4,163,690 12.11 4.86 6,616 Vested and expected to vest at December 31, 2015 6,120,365 11.87 6.10 7,491 |
Quarterly Financial Data (una42
Quarterly Financial Data (unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Data | First Second Third Fourth (in thousands, except for per share amounts) Quarter Quarter Quarter Quarter 2015 Revenue $ 22,150 $ 27,582 $ 28,344 $ 31,849 Gross profit 17,135 21,816 21,834 25,678 Loss from operations (10,293 ) (5,458 ) (9,541 ) (14,893 ) Net loss (10,221 ) (5,386 ) (9,461 ) (14,798 ) Net loss per share, basic and diluted $ (0.24 ) $ (0.13 ) $ (0.22 ) $ (0.35 ) 2014 Revenue $ 9,143 $ 10,862 $ 14,782 $ 15,370 Gross profit 9,143 10,664 14,079 14,688 Income (loss) from operations (26,578 ) (21,606 ) (1,448 ) 69,693 Net income (loss) (26,533 ) (21,575 ) (1,426 ) 69,719 Net income (loss) per share: Basic $ (0.79 ) $ (0.64 ) $ (0.04 ) $ 1.85 Diluted $ (0.79 ) $ (0.64 ) $ (0.04 ) $ 1.77 |
Summary of Significant Accoun43
Summary of Significant Accounting Policies - Additional Information (Detail) | 12 Months Ended | |||
Dec. 31, 2015USD ($)Segment | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Dec. 31, 2009USD ($) | |
Summary Of Significant Accounting Policies [Line Items] | ||||
Restricted cash, current and non-current | $ 800,000 | $ 800,000 | ||
Percentage of insurance coverage gap allocated for prescription drugs under Medicare Part D | 50.00% | |||
Advertising expenses | $ 3,400,000 | $ 5,000,000 | $ 0 | |
Number of reportable segments | Segment | 1 | |||
Fanapt | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Upfront payment received under Fanapt sublicense agreement from Novartis | $ 200,000,000 |
Net Sales by Product (Detail)
Net Sales by Product (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Revenue from External Customer [Line Items] | ||
Product sales, net | $ 109,925 | $ 12,909 |
HETLIOZ | ||
Revenue from External Customer [Line Items] | ||
Product sales, net | 44,302 | 12,802 |
Fanapt | ||
Revenue from External Customer [Line Items] | ||
Product sales, net | $ 65,623 | $ 107 |
Summary of Accounts Receivable
Summary of Accounts Receivable Allowance Activity (Detail) - Accounts Receivable Allowance - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Valuation and Qualifying Accounts Disclosure [Line Items] | ||
Beginning balance | $ 85 | |
Provision related to current period sales | 1,071 | $ 85 |
Adjustments for prior period sales | (85) | |
Credits/payments made | (12) | |
Ending balance | $ 1,059 | $ 85 |
Schedule of Major Customers tha
Schedule of Major Customers that Represented More Than 10% of Total Revenues (Detail) - Customer Concentration Risk - Sales Revenue, Net | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Novartis | Royalty Revenue | |||
Revenue, Major Customer [Line Items] | |||
Concentration Risk, Percentage | 13.00% | 21.00% | |
Novartis | Licensing agreement | |||
Revenue, Major Customer [Line Items] | |||
Concentration Risk, Percentage | 61.00% | 79.00% | |
Distributor A | |||
Revenue, Major Customer [Line Items] | |||
Concentration Risk, Percentage | 17.00% | ||
Distributor B | |||
Revenue, Major Customer [Line Items] | |||
Concentration Risk, Percentage | 18.00% | ||
Distributor C | |||
Revenue, Major Customer [Line Items] | |||
Concentration Risk, Percentage | 19.00% | ||
Distributor D | |||
Revenue, Major Customer [Line Items] | |||
Concentration Risk, Percentage | 14.00% | ||
Distributor E | |||
Revenue, Major Customer [Line Items] | |||
Concentration Risk, Percentage | 14.00% | ||
Distributor F | |||
Revenue, Major Customer [Line Items] | |||
Concentration Risk, Percentage | 12.00% |
Schedule of Major Customers t47
Schedule of Major Customers that Represented More Than 10% of Accounts Receivable, Net (Detail) - Credit Concentration Risk - Accounts Receivable | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Novartis | Royalty Revenue | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 42.00% | |
Distributor A | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 22.00% | |
Distributor B | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 24.00% | |
Distributor C | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 17.00% | |
Distributor D | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 12.00% | 21.00% |
Distributor E | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 12.00% | 17.00% |
Distributor F | Royalty Revenue | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 20.00% |
Black-Scholes-Merton Option Pri
Black-Scholes-Merton Option Pricing Model for Stock Options Granted (Detail) - $ / shares | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Share Based Payment Award Stock Options Valuation Assumptions [Line Items] | |||
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Weighted average expected volatility | 60.00% | 62.00% | 65.00% |
Weighted average expected term (years) | 6 years | 5 years 10 months 24 days | 6 years 11 days |
Weighted average risk-free rate | 1.67% | 1.73% | 1.59% |
Weighted average fair value per share | $ 11.74 | $ 6.99 | $ 6.10 |
Total Stock-Based Compensation
Total Stock-Based Compensation Expense (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total employee stock-based compensation expense | $ 7,961 | $ 5,878 | $ 5,404 |
Research and development | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total employee stock-based compensation expense | 2,269 | 1,933 | 2,166 |
Selling, general and administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total employee stock-based compensation expense | $ 5,692 | $ 3,945 | $ 3,238 |
Settlement Agreement with Nov50
Settlement Agreement with Novartis - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||
Oct. 31, 2014 | Aug. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2009 | |
Business Acquisition [Line Items] | |||||||
Net proceeds from offering of common stock | $ 62,300 | $ 48,500 | $ 62,313 | $ 48,505 | |||
Intangible assets, amortization method | Straight-line basis | ||||||
Gain on termination of pre-existing non-contractual relationship | $ 77,616 | $ 77,616 | |||||
Fanapt | |||||||
Business Acquisition [Line Items] | |||||||
Intangible assets, estimated useful life | 2016-11 | 2016-11 | |||||
Upfront payment received | $ 200,000 | ||||||
Settlement Agreement | |||||||
Business Acquisition [Line Items] | |||||||
Net proceeds from offering of common stock | $ 25,000 | ||||||
Effective date of the Settlement Agreement | Dec. 31, 2014 | ||||||
Gain on termination of pre-existing non-contractual relationship | $ 18,087 | ||||||
Up-front Payment Arrangement | |||||||
Business Acquisition [Line Items] | |||||||
Gain on termination of pre-existing non-contractual relationship | $ 59,529 | 59,529 | |||||
Novartis Pharma AG | |||||||
Business Acquisition [Line Items] | |||||||
Net proceeds from offering of common stock | 25,000 | ||||||
Novartis Pharma AG | Settlement Agreement | |||||||
Business Acquisition [Line Items] | |||||||
Net proceeds from offering of common stock | $ 25,000 | ||||||
Price per share | $ 13.82 | $ 13.82 | |||||
Stock issued during period, shares | 1,808,973 | ||||||
Percentage of premium to average closing prices | 10.00% | 10.00% | |||||
Trading days | 10 days | ||||||
Gain (Loss) on issuance of stock | $ (900) |
Fair Value of Consideration Exc
Fair Value of Consideration Exchanged as Part of Settlement Agreement (Detail) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||
Oct. 31, 2014 | Aug. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | |
Business Acquisition [Line Items] | |||||
Equity issued | $ 25,905 | ||||
Cash received | $ (62,300) | $ (48,500) | (62,313) | $ (48,505) | |
Settlement of pre-existing non-contractual relationship | $ 77,616 | 77,616 | |||
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 at
Assets Acquired and Recorded at Fair Value (Detail) $ in Thousands | Dec. 31, 2014USD ($) |
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 ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Numerator: | |||||||||||
Net income (loss) | $ (14,798) | $ (9,461) | $ (5,386) | $ (10,221) | $ 69,719 | $ (1,426) | $ (21,575) | $ (26,533) | $ (39,865) | $ 20,186 | $ (21,055) |
Denominator: | |||||||||||
Weighted average shares outstanding: Basic | 42,250,254 | 34,774,163 | 30,351,353 | ||||||||
Effect of dilutive securities | 1,912,560 | ||||||||||
Weighted average shares outstanding: Diluted | 42,250,254 | 36,686,723 | 30,351,353 | ||||||||
Net income (loss) per share, basic and diluted: | |||||||||||
Basic | $ 1.85 | $ (0.04) | $ (0.64) | $ (0.79) | $ (0.94) | $ 0.58 | $ (0.69) | ||||
Diluted | $ 1.77 | $ (0.04) | $ (0.64) | $ (0.79) | $ (0.94) | $ 0.55 | $ (0.69) | ||||
Antidilutive securities excluded from calculations of diluted net income (loss) per share | 5,660,199 | 3,524,656 | 4,409,811 |
Summary of Available-For-Sale M
Summary of Available-For-Sale Marketable Securities (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Schedule of Available-for-sale Securities [Line Items] | ||
Fair Market Value | $ 92,337 | $ 68,921 |
U.S. Treasury and government agencies | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fair Market Value | 44,057 | 30,618 |
Corporate debt | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fair Market Value | 48,280 | 38,303 |
Current Investment | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 92,298 | 68,905 |
Gross Unrealized Gains | 52 | 29 |
Gross Unrealized Losses | (13) | (13) |
Fair Market Value | 92,337 | 68,921 |
Current Investment | U.S. Treasury and government agencies | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 44,059 | 30,618 |
Gross Unrealized Gains | 6 | 4 |
Gross Unrealized Losses | (8) | (4) |
Fair Market Value | 44,057 | 30,618 |
Current Investment | Corporate debt | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 48,239 | 38,287 |
Gross Unrealized Gains | 46 | 25 |
Gross Unrealized Losses | (5) | (9) |
Fair Market Value | $ 48,280 | $ 38,303 |
Assets Measured at Fair Value o
Assets Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | $ 92,337 | $ 68,921 |
U.S. Treasury and government agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | 44,057 | 30,618 |
Corporate debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | 48,280 | 38,303 |
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 | 44,057 | 30,618 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | U.S. Treasury and government agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | 44,057 | 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 | 48,280 | 38,303 |
Significant Other Observable Inputs (Level 2) | Corporate debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | $ 48,280 | $ 38,303 |
Inventory (Detail)
Inventory (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Inventory [Line Items] | ||
Raw materials | $ 198 | |
Work-in-process | 1,326 | |
Finished goods | $ 1,294 | 3,394 |
Deferred cost of goods sold | 252 | |
Total | 1,294 | $ 5,170 |
Raw materials | 127 | |
Work-in-process | 2,369 | |
Total | $ 2,496 |
Summary of Prepaid Expenses and
Summary of Prepaid Expenses and Other Current Assets (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Prepaid Expenses And Other Current Assets [Line Items] | ||
Prepaid insurance | $ 423 | $ 270 |
Prepaid manufacturing cost | 346 | 358 |
Other prepaid expenses and vendor advances | 4,763 | 2,302 |
Other current assets | 210 | 154 |
Prepaid expenses and other current assets | $ 5,742 | $ 3,084 |
Summary of Property and Equipme
Summary of Property and Equipment-at Cost (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 6,883 | $ 4,170 |
Accumulated depreciation and amortization | (2,313) | (1,733) |
Property and equipment, net | $ 4,570 | 2,437 |
Computer and Other Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (Years) | 3 years | |
Property and equipment, gross | $ 2,046 | 1,316 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (Years) | 7 years | |
Property and equipment, gross | $ 1,318 | 765 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (Years) | 11 years | |
Property and equipment, gross | $ 3,519 | $ 2,089 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation expense | $ 582 | $ 530 | $ 432 |
Summary of Intangible Assets (D
Summary of Intangible Assets (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | |
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 60,941 | $ 35,941 | |
Accumulated Amortization | 22,189 | 9,217 | |
Net Carrying Amount | $ 38,752 | $ 26,724 | |
HETLIOZ | |||
Finite-Lived Intangible Assets [Line Items] | |||
Intangible assets, estimated useful life | 2022-12 | 2033-01 | 2033-01 |
Gross Carrying Amount | $ 33,000 | $ 8,000 | |
Accumulated Amortization | 3,460 | 539 | |
Net Carrying Amount | $ 29,540 | $ 7,461 | |
Fanapt | |||
Finite-Lived Intangible Assets [Line Items] | |||
Intangible assets, estimated useful life | 2016-11 | 2016-11 | |
Gross Carrying Amount | $ 27,941 | $ 27,941 | |
Accumulated Amortization | 18,729 | 8,678 | |
Net Carrying Amount | $ 9,212 | $ 19,263 |
Intangible Assets (Textual 2 -
Intangible Assets (Textual 2 - HETLIOZ) - Additional Information (Detail) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||
Jul. 31, 2013 | Feb. 29, 2004 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2006 | |
Finite-Lived Intangible Assets [Line Items] | |||||||
Acquisition of intangible assets | $ 8,000 | ||||||
Milestone obligation under license agreement | $ 25,000 | ||||||
Intangible asset amortization | $ 12,972 | $ 2,254 | $ 1,495 | ||||
HETLIOZ | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Acquisition of intangible assets | $ 3,000 | $ 500 | $ 8,000 | $ 1,000 | |||
Intangible assets, estimated useful life | 2022-12 | 2033-01 | 2033-01 | ||||
Cumulative worldwide sales milestone | $ 250,000 | ||||||
Milestone obligation under license agreement | 25,000 | ||||||
Intangible assets capitalized | 25,000 | ||||||
Intangible asset amortization | 2,900 | ||||||
Catch-up amortization of intangible asset | 1,200 | ||||||
Future annual amortization of intangible asset | $ 1,700 |
Intangible Assets (Textual 3 -
Intangible Assets (Textual 3 - Fanapt) - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2009 | |
Finite-Lived Intangible Assets [Line Items] | ||||
Acquisition of intangible assets | $ 8,000 | |||
Assets acquired and recorded at fair value, Intangible re-acquired right | 15,940 | |||
Intangible asset amortization | $ 12,972 | $ 2,254 | $ 1,495 | |
Fanapt | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Acquisition of intangible assets | $ 12,000 | |||
Estimated Patent life end date | 2016-11 | 2016-11 | ||
Assets acquired and recorded at fair value, Intangible re-acquired right | $ 15,940 | |||
Intangible asset amortization | $ 10,100 |
Intangible Assets - Additional
Intangible Assets - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Finite-Lived Intangible Assets [Line Items] | |||
Intangible asset amortization | $ 12,972 | $ 2,254 | $ 1,495 |
Summary of Future Intangible As
Summary of Future Intangible Asset Amortization (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Finite-Lived Intangible Assets [Line Items] | ||
Net Carrying Amount | $ 38,752 | $ 26,724 |
2,016 | 10,933 | |
2,017 | 1,721 | |
2,018 | 1,721 | |
2,019 | 1,721 | |
2,020 | 1,721 | |
Thereafter | 20,935 | |
HETLIOZ | ||
Finite-Lived Intangible Assets [Line Items] | ||
Net Carrying Amount | 29,540 | 7,461 |
2,016 | 1,721 | |
2,017 | 1,721 | |
2,018 | 1,721 | |
2,019 | 1,721 | |
2,020 | 1,721 | |
Thereafter | 20,935 | |
Fanapt | ||
Finite-Lived Intangible Assets [Line Items] | ||
Net Carrying Amount | 9,212 | $ 19,263 |
2,016 | $ 9,212 |
Summary of Accounts Payable and
Summary of Accounts Payable and Accrued Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Accrued Liabilities [Line Items] | ||
Research and development expenses | $ 3,199 | $ 1,759 |
Consulting and other professional fees | 5,088 | 2,522 |
Compensation and employee benefits | 468 | 388 |
Royalties payable | 5,328 | 602 |
Other | 1,684 | 2,020 |
Accounts payable and accrued liabilities | $ 15,767 | $ 7,291 |
Summary of Changes in Deferred
Summary of Changes in Deferred Licensing Revenue (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | |
Deferred Revenue Arrangement [Line Items] | |||
Balance beginning of year | $ 90,275 | $ 117,064 | |
Licensing revenue recognized | (30,746) | (26,789) | |
Recognized as part of gain on arbitration settlement | $ (77,616) | (77,616) | |
Balance end of year | $ 90,275 | ||
Up-front Payment Arrangement | |||
Deferred Revenue Arrangement [Line Items] | |||
Recognized as part of gain on arbitration settlement | $ (59,529) | $ (59,529) |
Deferred Licensing Revenue - Ad
Deferred Licensing Revenue - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2009 | |
Deferred Revenue Arrangement [Line Items] | ||||
Licensing agreement | $ 30,746 | $ 26,789 | ||
Recognized as part of gain on arbitration settlement | $ 77,616 | 77,616 | ||
Up-front Payment Arrangement | ||||
Deferred Revenue Arrangement [Line Items] | ||||
Recognized as part of gain on arbitration settlement | $ 59,529 | $ 59,529 | ||
Fanapt | ||||
Deferred Revenue Arrangement [Line Items] | ||||
Upfront payment received | $ 200,000 |
Summary of Minimum Annual Futur
Summary of Minimum Annual Future Payments Under Operating Leases (Detail) $ in Thousands | Dec. 31, 2015USD ($) |
Operating Leased Assets [Line Items] | |
Operating leases, Total | $ 13,315 |
Operating leases, 2016 | 1,500 |
Operating leases, 2017 | 1,538 |
Operating leases, 2018 | 1,576 |
Operating leases, 2019 | 1,616 |
Operating leases, 2020 | 1,656 |
Operating leases, Thereafter | $ 5,429 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015USD ($)ft² | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Commitments and Contingencies Disclosure [Line Items] | |||
Rent expense | $ 1.9 | $ 1.7 | $ 1.1 |
Washington DC Lease | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Renewal term of Lease agreement | 5 years | ||
Square feet leased | ft² | 30,260 | ||
Allowance for tenant improvements | $ 0.8 |
Commitments and Contingencies70
Commitments and Contingencies (Textual 2 - HETLIOZ) - Additional Information (Detail) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Jul. 31, 2013 | Feb. 29, 2004 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2006 | |
HETLIOZ | ||||||
Acquisition of intangible assets | $ 8,000 | |||||
Milestone obligation under license agreement | $ 25,000 | |||||
Percentage of future sublicense fees payable to third-party | Mid-twenties | |||||
HETLIOZ | ||||||
HETLIOZ | ||||||
Acquisition of intangible assets | $ 3,000 | $ 500 | $ 8,000 | $ 1,000 | ||
Milestone obligation under license agreement | $ 25,000 | |||||
Royalty payable percentage on net sales | 10.00% | |||||
Cumulative worldwide sales milestone | $ 250,000 | |||||
Intangible assets capitalized | $ 25,000 |
Commitments and Contingencies71
Commitments and Contingencies (Textual 3 - Fanapt) - Additional Information (Detail) - USD ($) | 1 Months Ended | 12 Months Ended | |
Feb. 29, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Subsequent Event | |||
Fanapt | |||
Royalty Payment | $ 2,000,000 | ||
November 16,2016 through December 31,2019 | Subsequent Event | |||
Fanapt | |||
Royalty payable percentage on net sales | 3.00% | ||
Fanapt | |||
Fanapt | |||
Royalty received percentage on net sales | 10.00% | ||
Fanapt | Subsequent Event | |||
Fanapt | |||
Royalty payable percentage on net sales | 6.00% | ||
Royalty payment period | 10 years | ||
Novartis Pharma AG | Through November 2016 | |||
Fanapt | |||
Royalty percentage payable on net sales below annual threshold | 23.00% | ||
Novartis Pharma AG | Royalty Rate for Annual Sales in Excess of $200 million | |||
Fanapt | |||
Royalty percentage payable on net sales above annual threshold | Mid-twenties | ||
Novartis Pharma AG | Maximum | |||
Fanapt | |||
Agreed upon sales threshold level for royalty rate | $ 200,000,000 |
Commitments and Contingencies72
Commitments and Contingencies (Textual 4 - Tradipitant) - Additional Information (Detail) - Tradipitant - USD ($) $ in Millions | 12 Months Ended | |
Dec. 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 | |
Future Regulatory Approval and Sales Milestones | ||
Tradipitant | ||
Possible future milestone payments | $ 95 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income Taxes [Line Items] | |||
Provision for income taxes | $ 0 | $ 0 | $ 0 |
Operating loss carryforwards, net | 232,600,000 | ||
Operating loss carryforwards, excess windfall benefits generated from stock options | $ 6,500,000 | ||
Net operating loss carryforwards beginning expiration year | 2,028 | ||
Carryforward credits beginning expiration year | 2,024 | ||
Research and Development | |||
Income Taxes [Line Items] | |||
Tax credits carryforwards | $ 6,800,000 | ||
Orphan Drug | |||
Income Taxes [Line Items] | |||
Tax credits carryforwards | $ 31,600,000 |
Reconciliation Between Statutor
Reconciliation Between Statutory Tax Rate and Effective Tax Rate (Detail) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income Tax Rate Reconciliation [Line Items] | |||
Federal tax at statutory rate | 35.00% | 34.00% | (34.00%) |
State taxes | (0.10%) | 7.20% | (4.00%) |
Change in valuation allowance | (25.40%) | (59.70%) | 43.90% |
Research and development credit | 1.50% | 1.30% | (1.10%) |
Orphan drug credit | 1.60% | 8.50% | (22.70%) |
Section 162(m) limitation | (5.70%) | 1.10% | 1.20% |
Tax rate change | (0.30%) | 4.80% | (0.30%) |
Change in State NOLs | (1.40%) | 0.00% | 18.50% |
Non-deductible stock-based compensation | (5.10%) | 0.00% | 0.00% |
Other non-deductible items | (0.10%) | 2.80% | (1.50%) |
Effective tax rate | 0.00% | 0.00% | 0.00% |
Components of Deferred Tax Asse
Components of Deferred Tax Assets, Net and Related Valuation Allowance (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Deferred tax assets: | ||||
Net operating loss carry forwards | $ 86,640 | $ 73,626 | ||
Stock-based compensation | 12,919 | 17,160 | ||
Accrued and deferred expenses | 1,443 | 532 | ||
Research and development and orphan drug credit carryforwards | 38,333 | 36,772 | ||
Other | 802 | 806 | ||
Total deferred tax assets | 140,137 | 128,896 | ||
Deferred tax liabilities: | ||||
Other | (1,100) | (6) | ||
Total deferred tax liabilities | (1,100) | (6) | ||
Deferred tax assets, net | 139,037 | 128,890 | ||
Valuation allowance | (139,037) | (128,890) | $ (141,150) | $ (133,271) |
Net deferred tax assets | $ 0 | $ 0 |
Valuation Allowance Activity on
Valuation Allowance Activity on Deferred Tax Assets (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Valuation Allowance [Line Items] | |||
Balance At Beginning Of Period | $ 128,890 | $ 141,150 | $ 133,271 |
Additions Charged To Income Tax Expense | 17,002 | 27,893 | 22,998 |
Reductions Credited To Income Tax Expense | (6,855) | (40,153) | (15,119) |
Balance At End Of Period | $ 139,037 | $ 128,890 | $ 141,150 |
Public Offering of Common Sto77
Public Offering of Common Stock - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Oct. 31, 2014 | Aug. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | |
Stockholders Equity Note [Line Items] | ||||
Public common stock offering, shares | 5,750,000 | 4,680,000 | ||
Common stock offering price, per share | $ 11.60 | $ 11.14 | ||
Net cash proceeds from public common stock offering | $ 62,300 | $ 48,500 | $ 62,313 | $ 48,505 |
Equity Incentive Plans (Textual
Equity Incentive Plans (Textual 1 - Equity Incentive Plan) - Additional Information (Detail) | Jan. 01, 2016shares | Dec. 31, 2015EquityPlanshares | Dec. 31, 2014shares | Dec. 31, 2013shares | Dec. 31, 2012shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of equity incentive plans | EquityPlan | 2 | ||||
2004 Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Outstanding options granted | 0 | 652,810 | 670,744 | 672,145 | |
2006 Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Outstanding options granted | 6,252,448 | 6,227,112 | 5,533,618 | 4,865,487 | |
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 | 7,275,129 | ||||
Shares available for future grant | 1,733,142 | ||||
2006 Plan | January 1, 2014 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Increase each January 1 in the number of shares reserved under 2006 Plan as a percentage of common stock outstanding | 4.00% | ||||
Maximum increase each January 1 in the number of shares reserved | 1,500,000 | ||||
2006 Plan | Subsequent Event | January 1, 2014 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Common stock reserved for issuance | 13,329,472 | ||||
Increase in number of shares reserved and available for future grant | 1,500,000 |
Equity Incentive Plans (Textu79
Equity Incentive Plans (Textual 2 Stock Option) - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
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 | ||
Proceeds from exercise of employee stock options | $ 4,374 | $ 2,851 | $ 1,550 |
Service option awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unrecognized compensation expenses | $ 12,600 | ||
Unrecognized compensation expenses, weighted average period | 1 year 4 months 24 days |
Summary of Option Activity for
Summary of Option Activity for 2004 Plan (Detail) - 2004 Plan - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Number of Shares | ||||
Beginning balance | 652,810 | 670,744 | 672,145 | |
Exercised | (652,810) | (17,934) | (115) | |
Expired | (1,286) | |||
Ending balance | 0 | 652,810 | 670,744 | 672,145 |
Weighted Average Exercise Price at Grant Date | ||||
Beginning balance | $ 1.74 | $ 1.79 | $ 1.79 | |
Exercised | $ 1.74 | 3.57 | 4.73 | |
Expired | 3.67 | |||
Ending balance | $ 1.74 | $ 1.79 | $ 1.79 | |
Weighted Average Remaining Term (Years) | ||||
Weighted Average Remaining Term | 9 months 11 days | 1 year 9 months 11 days | 2 years 9 months 11 days | |
Aggregate Intrinsic Value | ||||
Beginning balance | $ 8,212 | $ 7,124 | $ 1,512 | |
Exercised | $ 6,129 | |||
Ending balance | $ 8,212 | $ 7,124 | $ 1,512 |
Summary of Option Activity fo81
Summary of Option Activity for 2006 Plan (Detail) - 2006 Plan - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Number of Shares | ||||
Beginning balance | 6,227,112 | 5,533,618 | 4,865,487 | |
Granted | 1,056,500 | 1,324,337 | 1,245,500 | |
Forfeited | (496,854) | (237,108) | (54,226) | |
Expired | (64,336) | (259,295) | ||
Exercised | (469,974) | (393,735) | (263,848) | |
Ending balance | 6,252,448 | 6,227,112 | 5,533,618 | 4,865,487 |
Exercisable | 4,163,690 | |||
Vested and expected to vest at December 31, 2015 | 6,120,365 | |||
Weighted Average Exercise Price at Grant Date | ||||
Beginning balance | $ 11.58 | $ 10.98 | $ 10.83 | |
Granted | 11.74 | 12.17 | 10.18 | |
Forfeited | 10.75 | 8.35 | 6.14 | |
Expired | 25.69 | 10.65 | ||
Exercised | 7.02 | 7.08 | 5.86 | |
Ending balance | 11.87 | $ 11.58 | $ 10.98 | $ 10.83 |
Exercisable | 12.11 | |||
Vested and expected to vest at December 31, 2015 | $ 11.87 | |||
Weighted Average Remaining Term (Years) | ||||
Weighted Average Remaining Term | 6 years 1 month 28 days | 6 years 8 months 16 days | 6 years 11 months 5 days | 7 years 1 month 24 days |
Exercisable | 4 years 10 months 10 days | |||
Vested and expected to vest at December 31, 2015 | 6 years 1 month 6 days | |||
Aggregate Intrinsic Value | ||||
Beginning balance | $ 28,523 | $ 21,264 | $ 634 | |
Exercised | 2,594 | 2,923 | 1,545 | |
Ending balance | 7,498 | $ 28,523 | $ 21,264 | $ 634 |
Exercisable | 6,616 | |||
Vested and expected to vest at December 31, 2015 | $ 7,491 |
Equity Incentive Plans (Textu82
Equity Incentive Plans (Textual 3 RSU) - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
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 | ||
Fair value of common stock vested | $ 1.8 | ||
2006 Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Fair value of common stock vested, shares | 231,093 | 209,562 | 201,186 |
Restricted Stock Units (RSU) | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unrecognized compensation expenses related to unvested RSUs | $ 8.5 |
Summary of RSU Activity for 200
Summary of RSU Activity for 2006 Plan (Detail) - 2006 Plan - $ / shares | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Number of Shares Unvested | |||
Beginning balance | 1,025,961 | 883,690 | 705,376 |
Granted | 417,000 | 436,115 | 400,500 |
Forfeited | (189,187) | (84,282) | (21,000) |
Vested | (231,093) | (209,562) | (201,186) |
Ending balance | 1,022,681 | 1,025,961 | 883,690 |
Weighted Average Price/Share Unvested | |||
Beginning balance | $ 9.94 | $ 7.70 | $ 5.91 |
Granted | 11.51 | 12.28 | 10.29 |
Forfeited | 10.60 | 6.75 | 6.41 |
Vested | 7.96 | 6.67 | 6.71 |
Ending balance | $ 10.90 | $ 9.94 | $ 7.70 |
Employee Benefit Plan - Additio
Employee Benefit Plan - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Employee Benefit Plans [Line Items] | |||
Defined contribution plan employer matching percent | 50.00% | ||
Defined contribution plan maximum employee contribution percent | 6.00% | ||
Defined contribution plan vesting period | 4 years | ||
Defined contribution plan matching amount | $ 0.3 | $ 0.2 | $ 0.2 |
Legal Matters - Additional Info
Legal Matters - Additional Information (Detail) | 1 Months Ended |
Apr. 30, 2015Case | |
Roxane Laboratories Inc. | Pending Cases | |
Legal Proceedings [Line Items] | |
Number of cases that were consolidated | 2 |
Quarterly Financial Data (Detai
Quarterly Financial Data (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Quarterly Financial Data [Line Items] | |||||||||||
Revenue | $ 31,849 | $ 28,344 | $ 27,582 | $ 22,150 | $ 15,370 | $ 14,782 | $ 10,862 | $ 9,143 | $ 109,925 | $ 50,157 | $ 33,879 |
Gross profit | 25,678 | 21,834 | 21,816 | 17,135 | 14,688 | 14,079 | 10,664 | 9,143 | |||
Income (loss) from operations | (14,893) | (9,541) | (5,458) | (10,293) | 69,693 | (1,448) | (21,606) | (26,578) | (40,185) | 20,062 | (21,200) |
Net income (loss) | $ (14,798) | $ (9,461) | $ (5,386) | $ (10,221) | $ 69,719 | $ (1,426) | $ (21,575) | $ (26,533) | $ (39,865) | $ 20,186 | $ (21,055) |
Net income (loss) per share: | |||||||||||
Basic | $ 1.85 | $ (0.04) | $ (0.64) | $ (0.79) | $ (0.94) | $ 0.58 | $ (0.69) | ||||
Diluted | $ 1.77 | $ (0.04) | $ (0.64) | $ (0.79) | $ (0.94) | $ 0.55 | $ (0.69) | ||||
Net loss per share, basic and diluted | $ (0.35) | $ (0.22) | $ (0.13) | $ (0.24) |
Quarterly Financial Data (Una87
Quarterly Financial Data (Unaudited) - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||
Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Schedule Of Quarterly Financial Data [Line Items] | |||||||
Gain on arbitration settlement | $ 77,616 | $ 77,616 | |||||
Basic | $ 1.85 | $ (0.04) | $ (0.64) | $ (0.79) | $ (0.94) | $ 0.58 | $ (0.69) |
Diluted | 1.77 | $ (0.04) | $ (0.64) | $ (0.79) | $ (0.94) | $ 0.55 | $ (0.69) |
Arbitration | |||||||
Schedule Of Quarterly Financial Data [Line Items] | |||||||
Basic | 2.06 | ||||||
Diluted | $ 1.97 |