Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Nov. 01, 2013 | |
Document and Entity Information [Abstract] | ' | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 30-Sep-13 | ' |
Document Fiscal Year Focus | '2013 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Trading Symbol | 'ZGNX | ' |
Entity Registrant Name | 'ZOGENIX, INC. | ' |
Entity Central Index Key | '0001375151 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 107,792,467 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $17,352 | $41,228 |
Trade accounts receivable, net | 6,161 | 5,643 |
Inventory, net | 12,089 | 12,886 |
Prepaid expenses and other current assets | 1,772 | 2,254 |
Total current assets | 37,374 | 62,011 |
Property and equipment, net | 12,943 | 13,561 |
Other assets | 4,316 | 5,114 |
Total assets | 54,633 | 80,686 |
Current liabilities: | ' | ' |
Accounts payable | 2,972 | 4,592 |
Accrued expenses | 16,145 | 14,343 |
Common stock warrant liabilities | 12,273 | 9,493 |
Accrued compensation | 2,901 | 4,226 |
Total current liabilities | 34,291 | 32,654 |
Long-term debt, less current portion | 28,719 | 28,481 |
Other long-term liabilities | 5,512 | 5,078 |
Commitments and contingencies | ' | ' |
Stockholders' equity: | ' | ' |
Common stock | 108 | 101 |
Additional paid-in capital | 360,634 | 343,763 |
Accumulated deficit | -374,631 | -329,391 |
Total stockholders’ (deficit) equity | -13,889 | 14,473 |
Total liabilities and stockholders’ equity | $54,633 | $80,686 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations and Comprehensive Loss (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Revenue: | ' | ' | ' | ' |
Net product revenue | $6,897 | $8,453 | $22,693 | $26,368 |
Contract revenue | 0 | 0 | 0 | 8,462 |
Service and other revenue | 271 | 0 | 398 | 0 |
Total revenue | 7,168 | 8,453 | 23,091 | 34,830 |
Operating expenses: | ' | ' | ' | ' |
Cost of sales | 5,354 | 4,249 | 14,144 | 13,478 |
Royalty expense | 281 | 325 | 901 | 997 |
Research and development | 2,544 | 3,660 | 9,358 | 16,005 |
Selling, general and administrative | 10,011 | 10,857 | 36,491 | 37,574 |
Restructuring | 0 | 0 | 876 | 0 |
Total operating expenses | 18,190 | 19,091 | 61,770 | 68,054 |
Loss from operations | -11,022 | -10,638 | -38,679 | -33,224 |
Other income (expense): | ' | ' | ' | ' |
Interest income | 1 | 11 | 12 | 40 |
Interest expense | -1,587 | -3,463 | -4,795 | -8,730 |
Change in fair value of warrant liabilities | 215 | -3,569 | -2,780 | -3,611 |
Change in fair value of embedded derivatives | 1,474 | -202 | 912 | 166 |
Other income (expense) | 67 | -1,421 | 90 | -1,379 |
Total other income (expense) | 170 | -8,644 | -6,561 | -13,514 |
Net loss before income taxes | -10,852 | -19,282 | -45,240 | -46,738 |
Provision for income taxes | 0 | 0 | 0 | -5 |
Net loss | -10,852 | -19,282 | -45,240 | -46,743 |
Net loss per share, basic and diluted (usd per share) | ($0.10) | ($0.21) | ($0.44) | ($0.63) |
Weighted average shares outstanding, basic and diluted | 104,682 | 90,370 | 102,136 | 73,790 |
Comprehensive loss | ($10,852) | ($19,282) | ($45,240) | ($46,743) |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Operating activities: | ' | ' |
Net loss | ($45,240) | ($46,743) |
Adjustments to reconcile net loss to net cash used in operating activities: | ' | ' |
Stock-based compensation | 5,579 | 4,538 |
Restructuring | 201 | 0 |
Depreciation and amortization | 1,395 | 1,172 |
Amortization of debt issuance costs and non-cash interest | 422 | 1,898 |
Change in fair value of warrant liabilities | 2,780 | 3,611 |
Change in fair value of embedded derivatives | -912 | -166 |
Changes in operating assets and liabilities: | ' | ' |
Trade accounts receivable | -518 | -591 |
Inventory, net | 797 | 2,546 |
Prepaid expenses and other current assets | 482 | -469 |
Other assets | 614 | -286 |
Accounts payable and accrued expenses | 205 | -756 |
Restructuring liabilities | 6 | 0 |
Deferred revenue | 0 | -8,462 |
Net cash used in operating activities | -34,189 | -43,708 |
Investing activities: | ' | ' |
Purchases of property and equipment | -785 | -255 |
Net cash used in investing activities | -785 | -255 |
Financing activities: | ' | ' |
Proceeds from revolving credit facility | 0 | 9,900 |
Payments on borrowings of debt | 0 | -40,051 |
Proceeds from exercise of common stock options | 0 | 27 |
Proceeds from issuance of common stock and common stock warrants | 11,098 | 67,114 |
Net cash provided by financing activities | 11,098 | 36,990 |
Net decrease in cash and cash equivalents | -23,876 | -6,973 |
Cash and cash equivalents at beginning of period | 41,228 | 56,525 |
Cash and cash equivalents at end of period | $17,352 | $49,552 |
Organization_and_Basis_of_Pres
Organization and Basis of Presentation | 9 Months Ended |
Sep. 30, 2013 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
Organization and Basis of Presentation | ' |
Organization and Basis of Presentation | |
Zogenix, Inc. (the Company) is a pharmaceutical company developing and commercializing products for the treatment of central nervous system disorders and pain. The Company’s first commercial product, Sumavel®DosePro®(sumatriptan injection) Needle-free Delivery System, was launched in January 2010. Sumavel DosePro offers fast-acting, easy-to-use, needle-free subcutaneous administration of sumatriptan for the acute treatment of migraine and cluster headache in a pre-filled, single-use delivery system. Sumavel DosePro is the first drug product approved by the U.S. Food and Drug Administration (FDA) that allows for the needle-free, subcutaneous delivery of medication. The Company commercializes Sumavel DosePro through its internal sales and marketing organization and in collaboration with Mallinckrodt LLC, the Company's co-promotion partner. On October 25, 2013, the Company received FDA marketing approval for Zohydro™ ER (hydrocodone bitartrate) extended-release capsules, the first extended-release oral formulation of hydrocodone without acetaminophen. Zohydro ER is an opioid agonist for the management of pain severe enough to require daily, around-the-clock, long-term opioid treatment and for which alternative treatment options are inadequate. The Company plans to launch Zohydro ER in March 2014. | |
The Company was incorporated in the state of Delaware on May 11, 2006 as SJ2Therapeutics, Inc. and commenced operations on August 25, 2006. On August 28, 2006, the Company changed its name to Zogenix, Inc. | |
The Company has incurred significant net losses since inception and has relied on its ability to fund its operations through equity financings, debt financings, revenues from the sale of its product Sumavel DosePro and proceeds from business collaborations. As the Company continues to incur losses, successful transition to profitability is dependent upon achieving a level of revenues adequate to support the Company’s cost structure. This may not occur and, unless and until it does, the Company will continue to need to raise additional cash. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements have been prepared assuming that the Company will continue as a going concern and do not include any adjustments that might result from the outcome of this uncertainty. This basis of accounting contemplates the recovery of the Company’s assets and the satisfaction of liabilities in the normal course of business. | |
Management expects operating losses and negative cash flows to continue for at least the next year as the Company continues to incur costs related to the continued development of its product candidates and commercialization of its approved products. Management intends to pursue additional opportunities to raise additional capital, if required, through public or private equity offerings, including through a controlled equity offering program, debt financings, receivables financings or through collaborations or partnerships with other companies to further support its planned operations. There can be no assurance that the Company will be able to obtain any source of financing on acceptable terms, or at all. If the Company is unsuccessful in raising additional required funds, it may be required to significantly delay, reduce the scope of or eliminate one or more of its development programs or its commercialization efforts, or cease operating as a going concern. The Company also may be required to relinquish, license or otherwise dispose of rights to product candidates or products that it would otherwise seek to develop or commercialize itself on terms that are less favorable than might otherwise be available. | |
On March 27, 2013, the Company entered into a controlled equity offering sales agreement, or the sales agreement, with Cantor Fitzgerald & Co., or Cantor, as sales agent, under which the Company can issue and sell shares of its common stock having an aggregate offering price of up to $25.0 million from time to time through Cantor. The sales of common stock made under the controlled equity offering sales agreement will be made in “at-the-market” offerings as defined in Rule 415 of the Securities Act of 1933, as amended, or the Securities Act. During the nine months ended September 30, 2013, the Company issued 6.8 million shares of its common stock pursuant to the sales agreement at an average stock issuance price of $1.66 per share, resulting in net proceeds of approximately $10.9 million. As of September 30, 2013, the Company had the capacity to issue up to $13.8 million in shares of its common stock under the sales agreement. However, there can be no assurance that Cantor will be successful in consummating further sales based on prevailing market conditions or in the quantities or at the prices that management deems appropriate. |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Accounting Policies [Abstract] | ' | |||||||||||||||
Summary of Significant Accounting Policies | ' | |||||||||||||||
Summary of Significant Accounting Policies | ||||||||||||||||
Financial Statement Preparation and Use of Estimates | ||||||||||||||||
The unaudited consolidated financial statements contained in this Quarterly Report on Form 10-Q have been prepared by Zogenix, Inc. according to the rules and regulations of the Securities and Exchange Commission (SEC) and, therefore, certain information and disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (GAAP) have been omitted. | ||||||||||||||||
In the opinion of management, the accompanying unaudited consolidated financial statements for the periods presented reflect all adjustments, which are normal and recurring, necessary to fairly state the financial position, results of operations and cash flows. These unaudited consolidated financial statements should be read in conjunction with the audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2012 filed with the SEC on March 15, 2013. | ||||||||||||||||
The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results may differ from those estimates. | ||||||||||||||||
The Company has monitored actual product return history for Sumavel DosePro since product launch. Based on the Company's product returns analysis, which considers actual product returns on an individual product lot basis, and factors such as the dating of the Company's product at the time of shipment into the distribution channel, prescription trends, trends in customer purchases and their inventory management practices, and changes in the estimated levels of inventory within the distribution channel, the Company increased its estimate for product returns, resulting in adjustments of $1,226,000 in the first quarter of 2013 and $2,408,000 in the third quarter of 2013, which led to decreases in net product revenue for the respective periods. Further, as a result of the Company’s third quarter 2013 product returns analysis, the Company expects to utilize a higher product returns rate for future Sumavel DosePro sales. | ||||||||||||||||
Principles of Consolidation | ||||||||||||||||
The unaudited interim consolidated financial statements include the accounts of Zogenix, Inc. and its wholly owned subsidiary Zogenix Europe Limited, which was incorporated under the laws of England and Wales in June 2010. All intercompany transactions and investments have been eliminated in consolidation. Zogenix Europe Limited’s functional currency is the U.S. dollar, the reporting currency of its parent. | ||||||||||||||||
Fair Value Measurements | ||||||||||||||||
The carrying amount of financial instruments consisting of cash, trade accounts receivable, prepaid expenses and other current assets, accounts payable, accrued expenses, and accrued compensation included in the Company’s consolidated financial statements are reasonable estimates of fair value due to their short maturities. Based on the borrowing rates currently available to the Company for loans with similar terms, management believes the fair value of long-term debt approximates its carrying value. The liability for the annual tail payments due to Astellas Pharma US, Inc. (Astellas) (see Note 4) for the termination of the Company’s co-promotion agreement was measured at fair value in December 2011 using a present value technique, which incorporated the Company’s own credit risk as measured by the most recent round of debt financing with Healthcare Royalty Partners (Healthcare Royalty) (formerly Cowen Healthcare Royalty Partners II, L.P.). | ||||||||||||||||
Authoritative guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: | ||||||||||||||||
Level 1: | Observable inputs such as quoted prices in active markets; | |||||||||||||||
Level 2: | Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and | |||||||||||||||
Level 3: | Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. | |||||||||||||||
The Company classifies its cash equivalents within Level 1 of the fair value hierarchy because it values its cash equivalents using quoted market prices. The Company classifies its common stock warrant liabilities and embedded derivative liabilities within Level 3 of the fair value hierarchy because they are valued using valuation models with significant unobservable inputs. Assets and liabilities measured at fair value on a recurring basis at September 30, 2013 and December 31, 2012 are as follows (in thousands): | ||||||||||||||||
Fair Value Measurements at Reporting Date Using | ||||||||||||||||
Quoted | Significant | Significant | Total | |||||||||||||
Prices in | Other | Unobservable | ||||||||||||||
Active | Observable | Inputs | ||||||||||||||
Markets | Inputs | (Level 3) | ||||||||||||||
for | (Level 2) | |||||||||||||||
Identical | ||||||||||||||||
Assets | ||||||||||||||||
(Level 1) | ||||||||||||||||
At September 30, 2013 | ||||||||||||||||
Assets | ||||||||||||||||
Cash equivalents(1) | $ | 8,116 | — | — | $ | 8,116 | ||||||||||
Liabilities | ||||||||||||||||
Common stock warrant liabilities(2) | $ | — | — | 12,273 | $ | 12,273 | ||||||||||
Embedded derivative liabilities(3) | $ | — | — | 80 | $ | 80 | ||||||||||
At December 31, 2012 | ||||||||||||||||
Assets | ||||||||||||||||
Cash equivalents(1) | $ | 37,605 | — | — | $ | 37,605 | ||||||||||
Liabilities | ||||||||||||||||
Common stock warrant liabilities(2) | $ | — | — | 9,493 | $ | 9,493 | ||||||||||
Embedded derivative liabilities(3) | $ | — | — | 992 | $ | 992 | ||||||||||
-1 | Cash equivalents are comprised of money market fund shares and are included as a component of cash and cash equivalents on the consolidated balance sheets. | |||||||||||||||
-2 | Common stock warrant liabilities include liabilities associated with warrants issued in connection with the Company's July 2012 public offering of common stock and warrants (see Note 6) and warrants issued in connection with the Healthcare Royalty financing agreement (see Note 4), which are measured at fair value using the Black-Scholes option pricing valuation model. The assumptions used in the Black-Scholes option pricing valuation model for both common stock warrant liabilities were: (a) a risk-free interest rate based on the rates for U.S. Treasury zero-coupon bonds with maturities similar to those of the remaining contractual term of the warrants; (b) an assumed dividend yield of zero based on the Company’s expectation that it will not pay dividends in the foreseeable future; (c) an expected term based on the remaining contractual term of the warrants; and (d) given the Company’s lack of relevant historical data due to the Company’s limited historical experience, an expected volatility based upon the Company's historical volatility, supplemented with historical volatility of comparable companies whose share prices have been publicly available for a sufficient period of time. The significant unobservable input used in measuring the fair value of the common stock warrant liabilities associated with the Healthcare Royalty financing agreement is the expected volatility. Significant increases in volatility would result in a higher fair value measurement. The following additional assumptions were used in the Black-Scholes option pricing valuation model to measure the fair value of the warrants sold in the July 2012 public offering: (a) management’s projections regarding the probability of the occurrence of an extraordinary event that would require cash settlement of the warrants; and for the valuation scenario in which an extraordinary event occurs, (b) a volatility rate equal to the lesser of 40% and the 180-day volatility rate obtained from the HVT function on Bloomberg as of the trading day immediately following the public announcement of an extraordinary transaction. The significant unobservable inputs used in measuring the fair value of the common stock warrant liabilities associated with the July 2012 public offering are the expected volatility and the probability of the occurrence of an extraordinary event. Significant increases in volatility would result in a higher fair value measurement and significant increases in the probability of an extraordinary event occurring would result in a significantly lower fair value measurement. | |||||||||||||||
-3 | Embedded derivative liabilities measured at fair value using various discounted cash flow valuation models are included as a component of other long-term liabilities on the consolidated balance sheets. The assumptions used in the discounted cash flow valuation models include: (a) management’s revenue projections and a revenue sensitivity analysis based on possible future outcomes; (b) probability weighted net cash flows based on the likelihood of Healthcare Royalty receiving revenue interest payments over the term of the financing agreement; (c) probability of bankruptcy; (d) weighted average cost of capital that included the addition of a company specific risk premium to account for uncertainty associated with the Company achieving future cash flows; (e) the probability of a change in control occurring during the term of the Healthcare Royalty financing agreement; and (f) the probability of an exercise of the embedded derivative instruments. The significant unobservable inputs used in measuring the fair value of the embedded derivatives are management’s revenue projections. Significant decreases in these significant inputs would result in a higher fair value measurement. Management's revenue projections used in the September 30, 2013 valuation model significantly increased from prior periods as they included an increase in projected Zohydro ER revenues based on the October 2013 Zohydro ER NDA approval date. This significant increase in management's revenue projections led to a significant decrease in the fair value of embedded derivative liabilities as of September 30, 2013. | |||||||||||||||
The following table provides a reconciliation of liabilities measured at fair value using significant observable inputs (Level 3) for the nine months ended September 30, 2013 (in thousands): | ||||||||||||||||
Common | Embedded | |||||||||||||||
Stock | Derivative | |||||||||||||||
Warrant | Liabilities | |||||||||||||||
Liabilities | ||||||||||||||||
Balance at December 31, 2012 | $ | 9,493 | $ | 992 | ||||||||||||
Changes in fair value | 2,780 | (912 | ) | |||||||||||||
Balance at September 30, 2013 | $ | 12,273 | $ | 80 | ||||||||||||
Changes in fair value of the liabilities shown in the table above are recorded through change in fair value of warrant liabilities and change in fair value of embedded derivatives in other income (expense) in the consolidated statements of operations and comprehensive loss. | ||||||||||||||||
Net Loss per Share | ||||||||||||||||
Basic net loss per share is calculated by dividing the net loss by the weighted average number of common shares outstanding for the period, reduced by weighted average shares subject to repurchase, without consideration for common stock equivalents. Diluted net loss per share is computed by dividing the net loss by the weighted average number of common share equivalents outstanding for the period determined using the treasury-stock method and as-if converted method, as applicable. For purposes of this calculation, stock options and warrants are considered to be common stock equivalents and are only included in the calculation of diluted net loss per share when their effect is dilutive. | ||||||||||||||||
The following table presents the computation of basic and diluted net loss per share (in thousands, except per share amounts): | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Numerator | ||||||||||||||||
Net loss | $ | (10,852 | ) | $ | (19,282 | ) | $ | (45,240 | ) | $ | (46,743 | ) | ||||
Denominator | ||||||||||||||||
Weighted average common shares outstanding, basic and diluted | 104,682 | 90,370 | 102,136 | 73,790 | ||||||||||||
Basic and diluted net loss per share | $ | (0.10 | ) | $ | (0.21 | ) | $ | (0.44 | ) | $ | (0.63 | ) | ||||
The following table presents potentially dilutive securities not included in the calculation of diluted net loss per share because to do so would be anti-dilutive (in thousands, of common equivalent shares): | ||||||||||||||||
Three and Nine Months Ended | ||||||||||||||||
September 30, | ||||||||||||||||
2013 | 2012 | |||||||||||||||
Common stock options and restricted stock units | 1,776 | 6,542 | ||||||||||||||
Common stock warrants | — | 15,784 | ||||||||||||||
1,776 | 22,326 | |||||||||||||||
Segment Reporting | ||||||||||||||||
Management has determined that the Company operates in one business segment, which is the commercialization and development of pharmaceutical products. | ||||||||||||||||
Recent Accounting Pronouncements | ||||||||||||||||
In February 2013, the Financial Accounting Standards Board issued an Accounting Standards Update which requires entities to separately present amounts reclassified out of accumulated other comprehensive income (AOCI) for each component of AOCI and to disclose, for each affected line item in the income statement, the amount of AOCI that has been reclassified into that line item. For AOCI reclassification items that are not reclassified in their entirety into net income, it is acceptable to cross reference that amount to another footnote that provides the required disclosure. The updated guidance became effective for fiscal and interim periods beginning after December 15, 2012. The Company adopted this guidance on January 1, 2013 and it did not have a material impact on the Company's results of operations. |
Inventory_net
Inventory, net | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Disclosure Inventory Net [Abstract] | ' | |||||||
Inventory, net | ' | |||||||
Inventory, net (in thousands) | ||||||||
September 30, 2013 | December 31, 2012 | |||||||
Raw materials | $ | 3,329 | $ | 4,867 | ||||
Work in process | 4,863 | 6,134 | ||||||
Finished goods | 3,897 | 1,885 | ||||||
$ | 12,089 | $ | 12,886 | |||||
Collaboration_and_Financing_Ag
Collaboration and Financing Agreements | 9 Months Ended | |
Sep. 30, 2013 | ||
Collaborative and Financing Agreements [Abstract] | ' | |
Collaboration and Financing Agreements | ' | |
Collaboration and Financing Agreements | ||
Mallinckrodt LLC Co-Promotion Agreement | ||
On June 6, 2012, the Company and Mallinckrodt LLC (Mallinckrodt) entered into a co-promotion agreement (the Co-Promotion Agreement). Under the terms of the Co-Promotion Agreement, Mallinckrodt was granted a co-exclusive right (with the Company) to promote Sumavel DosePro to a mutually agreed prescriber audience in the United States. Mallinckrodt’s sales team began selling Sumavel DosePro to its customer base of prescribers in August 2012. Mallinckrodt has committed to a minimum number of sales representatives for the initial term of the Co-Promotion Agreement, which runs through June 30, 2014, and can be extended by mutual agreement of the parties in additional six month increments. The Company remains responsible for the manufacture, supply and distribution of commercial product for sale in the United States. In addition, the Company will supply product samples to Mallinckrodt at an agreed upon transfer price and Mallinckrodt will reimburse the Company for all other promotional materials used. | ||
In partial consideration of Mallinckrodt’s sales efforts, the Company pays Mallinckrodt a service fee on a quarterly basis that represents a specified fixed percentage of net sales of prescriptions generated from Mallinckrodt’s prescriber audience over a baseline amount of net sales to the same prescriber audience (the Baseline Net Sales). In addition, upon completion of the co-promotion term in June 30, 2014 (unless otherwise extended), and only if the Co-Promotion Agreement is not terminated as a result of certain circumstances, the Company will be required to pay Mallinckrodt an additional tail payment calculated as a fixed percentage of the Mallinckrodt net sales over the Baseline Net Sales during the first full 12 months following the last day of the term. | ||
Mallinckrodt may terminate the Co-Promotion Agreement with sixty days’ notice in the event a material change is made to the net sales price of Sumavel DosePro that would result in a material adverse effect to Mallinckrodt’s financial return (as defined in the Co-Promotion Agreement). Mallinckrodt may also terminate the Co-Promotion Agreement if its request for the inclusion on its call list of a certain number of additional prescribers is not mutually agreed upon. Lastly, Mallinckrodt may terminate the Co-Promotion Agreement if a governmental authority takes action or raises an objection that prevents or would reasonably be expected to make it unlawful for Mallinckrodt to perform, or subject Mallinckrodt to any penalty or claim, investigation or similar action related to, its obligations under the Co-Promotion Agreement, in the event of Company’s inability to meet trade demand for commercial product or where a third party files an action alleging that the making or selling of Sumavel DosePro infringes the intellectual property rights of such third party. | ||
The Company may terminate the Co-Promotion Agreement with sixty days’ notice if Mallinckrodt does not achieve an agreed-upon minimum sales effort. Either party may terminate the Co-Promotion Agreement if certain minimum net sales thresholds are not met for any quarter ending after December 31, 2012 or certain levels of prescriptions are not met in a specified period. In addition, either party may terminate the Co-Promotion Agreement related to safety concerns, in the event of a change of control of itself or the other party (excluding with respect to Mallinckrodt, any public spin-off of Mallinckrodt from its corporate parent Covidien plc), upon the introduction of a generic product, in connection with the material breach of the other party’s obligations or if a bankruptcy event occurs under certain circumstances. | ||
Amounts payable to Mallinckrodt for service fees are reflected as selling, general and administrative expenses. For the three and nine months ended September 30, 2013, the Company incurred $249,000 and $618,000, respectively, in service fee expenses under the Co-Promotion Agreement. For each of the three and nine months ended September 30, 2012, the Company incurred $92,000 in service fee expenses under the Co-Promotion Agreement. | ||
Astellas Pharma US, Inc. Co-Promotion Agreement | ||
In July 2009, the Company entered into the co-promotion agreement with Astellas (Astellas Co-Promotion Agreement). Under the terms of the agreement, the Company granted Astellas the co-exclusive right (with the Company) to market and sell Sumavel DosePro in the United States until June 30, 2013. Under the Astellas Co-Promotion Agreement, both Astellas and the Company were obligated to collaborate and fund the marketing of Sumavel DosePro and to provide annual minimum levels of sales effort directed at Sumavel DosePro during the term. In December 2011, the Company entered into an amendment to the Astellas Co-Promotion Agreement, or the amended Astellas Co-Promotion Agreement, whereby the agreement terminated on March 31, 2012. | ||
In connection with the execution of the Astellas Co-Promotion Agreement, Astellas made a non-refundable up-front payment of $2,000,000 and made an additional $18,000,000 of payments to the Company upon the achievement of a series of milestones. In consideration for Astellas’ performance of its commercial efforts, the Company paid Astellas a service fee on a quarterly basis that represents a fixed percentage of between 45% and 55% of Sumavel DosePro net sales to primary care physicians, OB/GYNs, emergency medicine physicians, and urologists in the United States (Astellas Segment). | ||
In accordance with accounting guidance for revenue arrangements with multiple deliverables, the Company initially recorded the $20,000,000 in upfront and milestone payments received from Astellas as deferred revenue. Beginning with the launch of Sumavel DosePro in January 2010, the Company began amortizing the upfront and milestone payments as contract | ||
revenue in the consolidated statement of operations and comprehensive loss over the term of the Astellas Co-Promotion Agreement. Upon termination of the Astellas Co-Promotion Agreement, the Company concluded that the remaining deferred revenue balance should be recognized ratably through the amended term of the agreement, and consequently, the remaining $8,462,000 of these deferred contract revenues as of December 31, 2011 was recognized as contract revenue during the three months ended March 31, 2012. | ||
The Company is required to make two annual tail payments to Astellas, calculated as decreasing fixed percentages of net sales in the Astellas Segment in the last 12 months of its active promotion. The value of such tail payments was estimated at a total of $5,291,000 based upon the agreement termination date of March 31, 2012, and recorded as a long-term liability on the amendment date of December 20, 2011. The fair value of the tail payments is being accreted through interest expense through the dates of payment in July 2013 and July 2014. The first tail payment of $2,032,000 was made in July 2013. As of September 30, 2013 and December 31, 2012, the tail payment liability was $1,090,000 and $2,795,000 (including the service fee reduction discussed below), respectively. During the three months ended September 30, 2013 and 2012, $40,000 and $93,000 of related interest expense was recognized, respectively, and $327,000 and $414,000 of related interest expense was recognized during the nine months ended September 30, 2013 and 2012, respectively. | ||
Further, under the terms of the amended Astellas Co-Promotion Agreement, Astellas contributed its agreed upon portion of marketing expenses through March 31, 2012, and continued to earn a service fee based on product sales to the Astellas Segment during that period. As of April 1, 2012, the Company was no longer required to pay service fees to Astellas for sales of Sumavel DosePro. Additionally, beginning in the second quarter of 2012, the Company’s sales force assumed full responsibility for the commercialization and the continued marketing of Sumavel DosePro, expanding their focus to include headache specialists, neurologists and primary care physicians in the United States. Amounts received from Astellas for shared marketing costs and sample product are reflected as a reduction of selling, general and administrative expenses, and amounts payable to Astellas for shared marketing expenses and service fees are reflected as selling, general and administrative expenses, inclusive of the estimated cost of the tail payments owed upon the termination of the agreement. | ||
In August 2012, the Company and Astellas completed a final reconciliation under the terms of the Astellas Co-Promotion Agreement and agreed to adjust the service fees paid to Astellas over the term of the Astellas Co-Promotion Agreement, resulting in a service fee reduction of $1,500,000, which offsets the two annual tail payments, and a reduction to the annual tail payment liability of $742,000. The present value of the service fee receivable and tail payment reduction of $1,924,000 was recorded as a reduction in selling, general and administrative expenses during the twelve months ended December 31, 2012, and an offset to the tail payment liability. The fair value of the service fee receivable and tail payment reduction for each of the tail payments will be accreted through interest expense through the dates of the two tail payments in July 2013 and July 2014. | ||
For the three months ended September 30, 2013 and 2012, the Company did not recognize any shared marketing expense under the Astellas Co-Promotion Agreement. For the nine months ended September 30, 2013 and 2012, the Company recognized shared marketing expense of $0 and $253,000, respectively. | ||
For the three months ended September 30, 2013 and 2012, the Company did not recognize any service fee expenses under the Astellas Co-Promotion Agreement. For the nine months ended September 30, 2013 and 2012, and prior to the final reconciliation of service fees, the Company incurred service fee expenses of $0 and $1,757,000, respectively. | ||
Valeant Pharmaceuticals North America LLC Co-Promotion Agreement | ||
On June 27, 2013, the Company entered into a co-promotion agreement (the Valeant Agreement) with Valeant Pharmaceuticals North America LLC (Valeant). Under the terms of the Valeant Agreement, the Company was granted the exclusive right (with Valeant or any of its affiliates) to promote Migranal® (dihydroergotamine mesylate) Nasal Spray (Migranal) to a prescriber audience of physicians and other health care practitioners in the United States. The Company's sales team began promoting Migranal to prescribers in August 2013. The term of the Valeant Agreement will run through December 31, 2015 (unless otherwise terminated), and can be extended by mutual agreement of the parties in additional twelve month increments. Valeant remains responsible for the manufacture, supply and distribution of Migranal for sale in the United States. In addition, Valeant will supply the Company with a specified amount of product samples every six months, and the Company will reimburse Valeant for the cost of additional samples and any promotional materials ordered by the Company. The cost of any additional samples and any promotional materials ordered by the Company will be recognized as selling, general and administrative expenses. | ||
In partial consideration of the Company's sales efforts, Valeant will pay the Company a co-promotion fee on a quarterly basis that represents specified percentages of net sales generated by the Company over defined baseline amounts of net sales (Baseline Forecast or Adjusted Baseline Forecast). In addition, upon completion of the co-promotion term, and only if the Valeant Agreement is not terminated by Valeant due to a bankruptcy event (as defined in the Valeant Agreement) or a material failure by the Company to comply with its material obligations under the Valeant Agreement, Valeant will be required to pay the Company an additional tail payment calculated as a fixed percentage of the Company's net sales over the Baseline Forecast (or Adjusted Baseline Forecast) during the first full six months following the last day of the term. | ||
The Company may terminate the Valeant Agreement in the event of a Valeant supply failure (as defined in the Valeant Agreement) or material product recall, or if the net sales price in a fiscal quarter is less than a specified percentage of the net sales price in the immediately preceding quarter, if the reduction in such net sales price would have a material adverse effect on the Company's financial return as a result of performance of its obligation under the Valeant Agreement. | ||
Either party may terminate the Valeant Agreement with six months' notice, provided that neither party may provide notice of termination before January 1, 2014. Either party may terminate the Valeant Agreement with 30 days' prior notice if the Company's net sales within a fiscal quarter fall below the Baseline Forecast (or Adjusted Baseline Forecast) for one or more fiscal quarters, or following the commercial introduction of a generic product to Migranal promoted or otherwise commercialized by a third party in the United States. In addition, either party may terminate the Valeant Agreement in the event of a change of control of itself or the other party (upon 90 days' prior written notice), upon any action taken or objection raised by governmental authority that prevents either party from performing its obligations under the Valeant Agreement, upon the filing of an action alleging patent infringement, in connection with the material breach of the other party's material obligations, or if a bankruptcy event of the other party occurs. | ||
The Company recognizes co-promotion fees received under the Valeant Agreement as service revenue in the period in which its promotional activities generate net sales over the Baseline Forecast or Adjusted Baseline Forecast. For each of the three and nine months ended September 30, 2013, the Company recognized service revenue of $232,000 under the Valeant Agreement. | ||
Healthcare Royalty Financing Agreement | ||
On July 18, 2011, the Company closed the royalty financing agreement (the Financing Agreement) with Healthcare Royalty. Under the terms of the Financing Agreement, the Company borrowed $30,000,000 from Healthcare Royalty (the Borrowed Amount) and the Company agreed to repay such Borrowed Amount together with a return to Healthcare Royalty, as described below, out of the Company’s direct product sales, co-promotion revenues and out-license revenues (collectively, Revenue Interest) that the Company may record or receive as a result of worldwide commercialization of the Company’s products including Sumavel DosePro, Zohydro ER and other future products. | ||
In addition, upon the closing of and in connection with the Financing Agreement, the Company issued and sold to Healthcare Royalty $1,500,000 of the Company’s common stock, or 388,601 shares, at a price of $3.86 per share. The Company also issued to Healthcare Royalty a warrant exercisable for up to 225,000 shares of the Company’s common stock. The warrant is exercisable at $9.00 per share and has a term of 10 years. As the warrant contains covenants where compliance with such covenants may be outside the control of the Company, the warrant was recorded as a current liability and marked to market at each reporting date using the Black-Scholes option pricing valuation model (see Note 2). | ||
Under the Financing Agreement, the Company is obligated to pay to Healthcare Royalty: | ||
• | 5% to 5.75% of the first $75,000,000 of Revenue Interest recorded (in the case of net product sales) or received (in the case of co-promotion revenues and license fees) by the Company in a calendar year (initially 5% and then 5.75% after the co-promotion agreement with Astellas terminated on March 31, 2012); | |
• | 2.5% of the next $75,000,000 of Revenue Interest recorded (in the case of net product sales) or received (in the case of co-promotion revenues and license fees) by the Company in a calendar year; and | |
• | 0.5% of Revenue Interest over and above $150,000,000 recorded (in the case of net product sales) or received (in the case of co-promotion revenues and license fees) by the Company in a calendar year. | |
Net sales of Sumavel DosePro outside the United States are only included in the Revenue Interest if such net sales exceed $10,000,000. Once the aggregate payments, including the fixed payments described below, made by the Company to Healthcare Royalty equal $75,000,000, the percentage of Revenue Interest owed to Healthcare Royalty is reduced to 0.5% for the remainder of the term of the Financing Agreement, with only Sumavel DosePro and Zohydro ER subject to the Revenue Interest payments thereafter. The Company is also obligated to make three fixed payments of $10,000,000 on (or before at the option of the Company) each of January 31, 2015, January 31, 2016 and January 31, 2017. Unless terminated as discussed below, the Financing Agreement terminates on March 31, 2018. | ||
As security for the payment of the Company's obligations under the Financing Agreement, the Company also entered into a security agreement whereby the Company granted to Healthcare Royalty a security interest in all assets of the Company, including intellectual property and other rights of the Company to the extent necessary or used to commercialize the Company products. Healthcare Royalty entered into an intercreditor agreement under which its security interest was junior to the security interest of the lenders under the Company’s $25.0 million loan and security agreement. The intercreditor agreement terminated on July 30, 2012 when the Company terminated its $25.0 million loan and security agreement. Healthcare Royalty’s security interest will be extinguished at the end of the term or once the aggregate payments made by the Company to Healthcare Royalty equal to $75,000,000, whichever is sooner. The Company has agreed to specified positive and negative covenants in connection with the Financing Agreement. | ||
The Company has the option to terminate the Financing Agreement at the Company’s election in connection with a change of control of the Company, upon the payment of a base amount of $52,500,000, or, if higher, an amount that generates a 19% internal rate of return on the Borrowed Amount as of the date of prepayment, in each case reduced by the Revenue Interest and principal payments received by Healthcare Royalty up to the date of prepayment. | ||
Healthcare Royalty has the option to terminate the Financing Agreement at its election in connection with a change of control of the Company (which may include the sale, transfer, assignment or licensing of the Company’s rights in the United States to either Sumavel DosePro or Zohydro ER), or an event of default (which includes the occurrence of a bankruptcy event or other material adverse change in the Company’s business), as defined in the Financing Agreement. Upon such a termination by Healthcare Royalty, the Company is obligated to make a payment of a base amount of $45,000,000, or, if higher, an amount that generates a 17% internal rate of return on the Borrowed Amount as of the date of prepayment, in each case reduced by the Revenue Interest and principal payments received by Healthcare Royalty up to the date of prepayment. | ||
The rights of the Company and Healthcare Royalty to terminate the Financing Agreement early, as well as the change in the Revenue Interest rate from 5% to 5.75% in connection with the early termination of the Astellas Co-Promotion Agreement, meet the definition of an embedded derivative. As a result, the Company carved out these embedded derivatives from the Financing Agreement and determined the fair value of each derivative using various discounted cash flow valuation models taking into account the probability of these events occurring and various scenarios surrounding the potential Revenue Interest payments that would be made if these events occurred (see Note 2). The aggregate fair value of the embedded derivatives as of September 30, 2013 and December 31, 2012 was $80,000 and $992,000, respectively, and is included in other long-term liabilities. | ||
The Company received aggregate net proceeds of $29,485,000 from the Financing Agreement (including the purchase of common stock). The discounts, which are being amortized using the effective interest method over the term of the arrangement within interest expense, include the fair value of the common stock warrants issued to Healthcare Royalty of $790,000 upon the closing of the Financing Agreement, fees payable to Healthcare Royalty in connection with the execution of the arrangement of $476,000 and the fair value of embedded derivatives of $605,000 upon the closing of the Financing Agreement. The Company has recognized other income (expense) in relation to the change in the fair value of the Healthcare Royalty common stock warrant of $(8,000) and $(23,000) for the three months ended September 30, 2013 and 2012, respectively, and $(43,000) and $(65,000) for the nine months ended September 30, 2013 and 2012, respectively, in the statement of operations and comprehensive loss. The Company has recognized other income (expense) in relation to the change in the fair value of the Healthcare Royalty embedded derivatives of $1,474,000 and $(202,000) for the three months ended September 30, 2013 and 2012, respectively, and $912,000 and $166,000 for the nine months ended September 30, 2013 and 2012, respectively, in the statement of operations and comprehensive loss. | ||
Term Debt | ||
In June 2008, the Company entered into a Loan and Security Agreement with Oxford and CIT Healthcare LLC (the Oxford Agreement) under which it borrowed $18,000,000. The obligations under the Oxford Agreement were collateralized by personal property excluding certain intellectual property and all equipment pledged to secure an equipment financing. In July and October 2010, the Company amended and restated the Oxford Agreement, and Oxford and Silicon Valley Bank (SVB) became party to the amended agreement. In June 2011, the Company again amended and restated the amended Oxford/SVB agreement (the Amended Oxford/SVB Agreement), which provided among other things, the addition of intellectual property to the collateral securing the Oxford/SVB loan and the deferral of principal repayment to commence on February 1, 2012. | ||
The Amended Oxford/SVB Agreement consisted of a $25,000,000 term loan and a $10,000,000 revolving credit facility. The obligations under the Amended Oxford/SVB Agreement were collateralized by the Company’s intellectual property (including among other things, copyrights, patents, patent applications, trademarks, service marks and trade secret rights) and personal property (including, among other things, accounts receivable, equipment, inventory, contract rights, rights to payment of money, license agreements, general intangibles and cash). The $25,000,000 term loan bore an interest rate of 12.06% per annum. Under the terms of the revolving credit facility, $10,000,000 was available to be borrowed within a specified percentage of the Company’s eligible accounts receivable and inventory balances (as defined in the agreement). Amounts outstanding under the revolving credit facility accrued interest payable monthly at a floating rate per annum equal to the greater of 3.29% above SVB’s prime rate or 7.29%. In addition, the Company paid a monthly fee equal to 0.5% per annum of the average unused portion of the revolving credit facility. | ||
On July 30, 2012, the Company exercised its right to terminate the Amended Oxford/SVB Agreement prior to the loan maturity date of January 2, 2014 and repaid $19,492,000 of outstanding principal and interest under the agreement. In addition to the repayment of all principal and interest outstanding, the Company was also required to make a final payment of $1,200,000 and a prepayment premium of $400,000, or 2% of the then outstanding principal. The Company also paid a $100,000 prepayment premium to terminate the revolving credit facility. As a result of the termination of the Amended Oxford/SVB Agreement, the lenders no longer have a security interest in the Company’s intellectual property and personal property. |
Restructuring
Restructuring | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Restructuring and Related Activities [Abstract] | ' | ||||||||||||
Restructuring | ' | ||||||||||||
Restructuring | |||||||||||||
In May 2013, the Company commenced a restructuring of its workforce, resulting in a reduction in force of 55 employees across all functional areas of the Company. During the three months ended June 30, 2013, the Company recorded restructuring charges of $876,000 consisting primarily of employee-related compensation charges. The Company did not record any restructuring charges during the three months ended September 30, 2013. The following table summarizes the components of the restructuring charges for the nine months ended September 30, 2013 (in thousands): | |||||||||||||
Nine Months Ended September 30, 2013 | |||||||||||||
Accruals | Non-cash items | Total | |||||||||||
Employee-related charges | $ | 663 | $ | 201 | $ | 864 | |||||||
Other restructuring charges | 12 | — | 12 | ||||||||||
$ | 675 | $ | 201 | $ | 876 | ||||||||
The following table sets forth activity in the restructuring liability for the nine months ended September 30, 2013, which is primarily comprised of employee severance costs (in thousands): | |||||||||||||
Employee severance costs | Other restructuring charges | Total | |||||||||||
Balance at December 31, 2012 | $ | — | — | $ | — | $ | — | ||||||
Accruals | 663 | 12 | 675 | ||||||||||
Payments | (657 | ) | (12 | ) | (669 | ) | |||||||
Balance at September 30, 2013 | $ | 6 | $ | — | $ | 6 | |||||||
The balance of the restructuring liability at September 30, 2013 is anticipated to be fully distributed by June 2014. |
Common_Stock_Warrants
Common Stock Warrants | 9 Months Ended |
Sep. 30, 2013 | |
Disclosure Common Stock Warrants Additional Informational [Abstract] | ' |
Common Stock Warrants | ' |
Common Stock Warrants | |
In July 2012, in connection with a public offering of common stock and warrants, the Company sold warrants to purchase 15,784,200 shares of common stock (including over-allotment purchase). The warrants are exercisable at an exercise price of $2.50 per share and will expire on July 27, 2017, which is 5 years from the date of issuance. As the warrants contain a cash settlement feature upon the occurrence of certain events that may be outside of the Company’s control, the warrants are recorded as a current liability and are marked to market at each reporting period (see Note 2). The fair value of the warrants was approximately $12,045,000 and $9,308,000 as of September 30, 2013 and December 31, 2012, respectively. | |
In July 2011, upon the closing of and in connection with the Financing Agreement (see Note 4), the Company issued to Healthcare Royalty a warrant exercisable into 225,000 shares of common stock. The warrant is exercisable at $9.00 per share of common stock and has a term of 10 years. As the warrant contains covenants where compliance with such covenants may be outside of the Company’s control, the warrant was recorded as a current liability and is marked to market at each reporting date (see Note 2). The fair value of the warrant was approximately $228,000 as of September 30, 2013 and $185,000 as of December 31, 2012. | |
In June 2011, and in connection with entering into the Amended Oxford/SVB Agreement (see Note 4), the Company issued to Oxford and SVB warrants exercisable into an aggregate of 26,455 shares of common stock. The warrants are exercisable at $3.78 per share of common stock and have a term of 7 years. The value of the warrants of approximately $76,000 was recorded as debt discount and additional paid in capital in the consolidated balance sheet as of December 31, 2011. |
StockBased_Compensation
Stock-Based Compensation | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||||||
Stock-Based Compensation | ' | |||||||||||||||
Stock-Based Compensation | ||||||||||||||||
The Company uses the Black-Scholes option-pricing model for determining the estimated fair value of stock-based compensation for stock-based awards to employees and the board of directors. The assumptions used in the Black-Scholes option-pricing model for the three and nine months ended September 30, 2013 and 2012 are as follows: | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Risk free interest rate | 1.5% to 1.7% | 0.7% to 0.9% | 0.8% to 1.7% | 0.2% to 1.2% | ||||||||||||
Expected term | 5.1 to 6.0 years | 5.0 to 6.1 years | 5.0 to 6.1 years | 5.0 to 6.1 years | ||||||||||||
Expected volatility | 82.8% to 83.9% | 80.1% to 81.7% | 82.8% to 87.9% | 80.1% to 82.8% | ||||||||||||
Expected dividend yield | — | % | — | % | — | % | — | % | ||||||||
The risk-free interest rate assumption was based on the rates for U.S. Treasury zero-coupon bonds with maturities similar to those of the expected term of the award being valued. The assumed dividend yield was based on the Company’s expectation of not paying dividends in the foreseeable future. The weighted average expected term of options was calculated using the simplified method as prescribed by accounting guidance for stock-based compensation. This decision was based on the lack of relevant historical data due to the Company’s limited historical experience. In addition, due to the Company’s limited historical data, the estimated volatility was calculated based upon the Company's historical volatility, supplemented with historical volatility of comparable companies whose share prices are publicly available for a sufficient period of time. | ||||||||||||||||
The Company recognized stock-based compensation expense as follows (in thousands): | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Cost of sales | $ | 119 | $ | 53 | $ | 227 | $ | 130 | ||||||||
Research and development | 316 | 256 | 782 | 687 | ||||||||||||
Selling, general and administrative | 1,780 | 1,433 | 4,570 | 3,721 | ||||||||||||
Restructuring | — | — | 201 | — | ||||||||||||
Total | $ | 2,215 | $ | 1,742 | $ | 5,780 | $ | 4,538 | ||||||||
As of September 30, 2013, there was approximately $12,898,000 of total unrecognized compensation costs related to outstanding options, which is expected to be recognized over a weighted average period of 2.7 years. |
Subsequent_Event_Notes
Subsequent Event (Notes) | 9 Months Ended |
Sep. 30, 2013 | |
Subsequent Events [Abstract] | ' |
Subsequent Event | ' |
Subsequent Event | |
On November 1, 2013, the Company entered into a Development and Option Agreement (the Development Agreement) with Altus Formulation Inc. (Altus). Under the Development Agreement, Altus will be responsible for the development of abuse deterrent formulations of hydrocodone using Altus’ Intellitab™ drug delivery platform and will be reimbursed by the Company for its development efforts on the product. The Company is responsible for the conduct of the clinical development of the product and will pay a non-refundable upfront fee to Altus of $750,000. The Company is also obligated to pay Altus up to $3,500,000 in total future milestone payments upon the achievement of various development and regulatory milestones. | |
Pursuant to the Development Agreement, the Company was granted an option to obtain an exclusive, royalty-bearing license, with the right to sublicense, to certain Altus intellectual property rights to make, have made, import, use, sell, have sold, offer for sale and import an abuse deterrent formulation of hydrocodone for the treatment or relief of pain in the United States. However, the Company will need to obtain the consent of Alkermes or otherwise amend its license agreement with Alkermes for Zohydro ER in order to exercise the option and ultimately commercialize the Altus abuse deterrent formulation of hydrocodone. If the Company exercises this option, Altus will be eligible to receive additional regulatory and sales milestones and a royalty based on net sales of the licensed product. | |
The term of the Development Agreement will end upon expiration of the earlier of (1) the date upon which a NDA or similar application for regulatory approval is submitted by the Company for the Altus abuse resistant formulation of hydrocodone, or (2) November 1, 2016. The Company may terminate the Development Agreement upon 30 days’ written notice or upon written notice of a material uncured breach by Altus. In addition, the Company may terminate any work plan under the Development Agreement upon written notice. Altus may only terminate the Development Agreement upon the occurrence of certain bankruptcy events with respect to the Company. Altus may also terminate a work plan under the Development Agreement upon written notice of the Company’s material uncured breach. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 9 Months Ended | |
Sep. 30, 2013 | ||
Accounting Policies [Abstract] | ' | |
Financial Statement Preparation and Use of Estimates | ' | |
Financial Statement Preparation and Use of Estimates | ||
The unaudited consolidated financial statements contained in this Quarterly Report on Form 10-Q have been prepared by Zogenix, Inc. according to the rules and regulations of the Securities and Exchange Commission (SEC) and, therefore, certain information and disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (GAAP) have been omitted. | ||
In the opinion of management, the accompanying unaudited consolidated financial statements for the periods presented reflect all adjustments, which are normal and recurring, necessary to fairly state the financial position, results of operations and cash flows. These unaudited consolidated financial statements should be read in conjunction with the audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2012 filed with the SEC on March 15, 2013. | ||
The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results may differ from those estimates. | ||
Principles of Consolidation | ' | |
Principles of Consolidation | ||
The unaudited interim consolidated financial statements include the accounts of Zogenix, Inc. and its wholly owned subsidiary Zogenix Europe Limited, which was incorporated under the laws of England and Wales in June 2010. All intercompany transactions and investments have been eliminated in consolidation. Zogenix Europe Limited’s functional currency is the U.S. dollar, the reporting currency of its parent. | ||
Fair Value Measurements | ' | |
Fair Value Measurements | ||
The carrying amount of financial instruments consisting of cash, trade accounts receivable, prepaid expenses and other current assets, accounts payable, accrued expenses, and accrued compensation included in the Company’s consolidated financial statements are reasonable estimates of fair value due to their short maturities. Based on the borrowing rates currently available to the Company for loans with similar terms, management believes the fair value of long-term debt approximates its carrying value. The liability for the annual tail payments due to Astellas Pharma US, Inc. (Astellas) (see Note 4) for the termination of the Company’s co-promotion agreement was measured at fair value in December 2011 using a present value technique, which incorporated the Company’s own credit risk as measured by the most recent round of debt financing with Healthcare Royalty Partners (Healthcare Royalty) (formerly Cowen Healthcare Royalty Partners II, L.P.). | ||
Authoritative guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: | ||
Level 1: | Observable inputs such as quoted prices in active markets; | |
Level 2: | Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and | |
Level 3: | Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. | |
The Company classifies its cash equivalents within Level 1 of the fair value hierarchy because it values its cash equivalents using quoted market prices. The Company classifies its common stock warrant liabilities and embedded derivative liabilities within Level 3 of the fair value hierarchy because they are valued using valuation models with significant unobservable inputs. | ||
Changes in fair value of the liabilities shown in the table above are recorded through change in fair value of warrant liabilities and change in fair value of embedded derivatives in other income (expense) in the consolidated statements of operations and comprehensive loss. | ||
Net Loss per Share | ' | |
Net Loss per Share | ||
Basic net loss per share is calculated by dividing the net loss by the weighted average number of common shares outstanding for the period, reduced by weighted average shares subject to repurchase, without consideration for common stock equivalents. Diluted net loss per share is computed by dividing the net loss by the weighted average number of common share equivalents outstanding for the period determined using the treasury-stock method and as-if converted method, as applicable. For purposes of this calculation, stock options and warrants are considered to be common stock equivalents and are only included in the calculation of diluted net loss per share when their effect is dilutive. | ||
Segment Reporting | ' | |
Segment Reporting | ||
Management has determined that the Company operates in one business segment, which is the commercialization and development of pharmaceutical products. | ||
Recent Accounting Pronouncements | ' | |
Recent Accounting Pronouncements | ||
In February 2013, the Financial Accounting Standards Board issued an Accounting Standards Update which requires entities to separately present amounts reclassified out of accumulated other comprehensive income (AOCI) for each component of AOCI and to disclose, for each affected line item in the income statement, the amount of AOCI that has been reclassified into that line item. For AOCI reclassification items that are not reclassified in their entirety into net income, it is acceptable to cross reference that amount to another footnote that provides the required disclosure. The updated guidance became effective for fiscal and interim periods beginning after December 15, 2012. The Company adopted this guidance on January 1, 2013 and it did not have a material impact on the Company's results of operations. |
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Accounting Policies [Abstract] | ' | |||||||||||||||
Assets and Liabilities Measured at Fair Value on a Recurring Basis | ' | |||||||||||||||
Assets and liabilities measured at fair value on a recurring basis at September 30, 2013 and December 31, 2012 are as follows (in thousands): | ||||||||||||||||
Fair Value Measurements at Reporting Date Using | ||||||||||||||||
Quoted | Significant | Significant | Total | |||||||||||||
Prices in | Other | Unobservable | ||||||||||||||
Active | Observable | Inputs | ||||||||||||||
Markets | Inputs | (Level 3) | ||||||||||||||
for | (Level 2) | |||||||||||||||
Identical | ||||||||||||||||
Assets | ||||||||||||||||
(Level 1) | ||||||||||||||||
At September 30, 2013 | ||||||||||||||||
Assets | ||||||||||||||||
Cash equivalents(1) | $ | 8,116 | — | — | $ | 8,116 | ||||||||||
Liabilities | ||||||||||||||||
Common stock warrant liabilities(2) | $ | — | — | 12,273 | $ | 12,273 | ||||||||||
Embedded derivative liabilities(3) | $ | — | — | 80 | $ | 80 | ||||||||||
At December 31, 2012 | ||||||||||||||||
Assets | ||||||||||||||||
Cash equivalents(1) | $ | 37,605 | — | — | $ | 37,605 | ||||||||||
Liabilities | ||||||||||||||||
Common stock warrant liabilities(2) | $ | — | — | 9,493 | $ | 9,493 | ||||||||||
Embedded derivative liabilities(3) | $ | — | — | 992 | $ | 992 | ||||||||||
-1 | Cash equivalents are comprised of money market fund shares and are included as a component of cash and cash equivalents on the consolidated balance sheets. | |||||||||||||||
-2 | Common stock warrant liabilities include liabilities associated with warrants issued in connection with the Company's July 2012 public offering of common stock and warrants (see Note 6) and warrants issued in connection with the Healthcare Royalty financing agreement (see Note 4), which are measured at fair value using the Black-Scholes option pricing valuation model. The assumptions used in the Black-Scholes option pricing valuation model for both common stock warrant liabilities were: (a) a risk-free interest rate based on the rates for U.S. Treasury zero-coupon bonds with maturities similar to those of the remaining contractual term of the warrants; (b) an assumed dividend yield of zero based on the Company’s expectation that it will not pay dividends in the foreseeable future; (c) an expected term based on the remaining contractual term of the warrants; and (d) given the Company’s lack of relevant historical data due to the Company’s limited historical experience, an expected volatility based upon the Company's historical volatility, supplemented with historical volatility of comparable companies whose share prices have been publicly available for a sufficient period of time. The significant unobservable input used in measuring the fair value of the common stock warrant liabilities associated with the Healthcare Royalty financing agreement is the expected volatility. Significant increases in volatility would result in a higher fair value measurement. The following additional assumptions were used in the Black-Scholes option pricing valuation model to measure the fair value of the warrants sold in the July 2012 public offering: (a) management’s projections regarding the probability of the occurrence of an extraordinary event that would require cash settlement of the warrants; and for the valuation scenario in which an extraordinary event occurs, (b) a volatility rate equal to the lesser of 40% and the 180-day volatility rate obtained from the HVT function on Bloomberg as of the trading day immediately following the public announcement of an extraordinary transaction. The significant unobservable inputs used in measuring the fair value of the common stock warrant liabilities associated with the July 2012 public offering are the expected volatility and the probability of the occurrence of an extraordinary event. Significant increases in volatility would result in a higher fair value measurement and significant increases in the probability of an extraordinary event occurring would result in a significantly lower fair value measurement. | |||||||||||||||
-3 | Embedded derivative liabilities measured at fair value using various discounted cash flow valuation models are included as a component of other long-term liabilities on the consolidated balance sheets. The assumptions used in the discounted cash flow valuation models include: (a) management’s revenue projections and a revenue sensitivity analysis based on possible future outcomes; (b) probability weighted net cash flows based on the likelihood of Healthcare Royalty receiving revenue interest payments over the term of the financing agreement; (c) probability of bankruptcy; (d) weighted average cost of capital that included the addition of a company specific risk premium to account for uncertainty associated with the Company achieving future cash flows; (e) the probability of a change in control occurring during the term of the Healthcare Royalty financing agreement; and (f) the probability of an exercise of the embedded derivative instruments. The significant unobservable inputs used in measuring the fair value of the embedded derivatives are management’s revenue projections. Significant decreases in these significant inputs would result in a higher fair value measurement. | |||||||||||||||
Reconciliation of Liabilities Measured at Fair Value Using Significant Observable Inputs (Level 3) | ' | |||||||||||||||
The following table provides a reconciliation of liabilities measured at fair value using significant observable inputs (Level 3) for the nine months ended September 30, 2013 (in thousands): | ||||||||||||||||
Common | Embedded | |||||||||||||||
Stock | Derivative | |||||||||||||||
Warrant | Liabilities | |||||||||||||||
Liabilities | ||||||||||||||||
Balance at December 31, 2012 | $ | 9,493 | $ | 992 | ||||||||||||
Changes in fair value | 2,780 | (912 | ) | |||||||||||||
Balance at September 30, 2013 | $ | 12,273 | $ | 80 | ||||||||||||
Basic and Diluted Net Loss Per Share | ' | |||||||||||||||
The following table presents the computation of basic and diluted net loss per share (in thousands, except per share amounts): | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Numerator | ||||||||||||||||
Net loss | $ | (10,852 | ) | $ | (19,282 | ) | $ | (45,240 | ) | $ | (46,743 | ) | ||||
Denominator | ||||||||||||||||
Weighted average common shares outstanding, basic and diluted | 104,682 | 90,370 | 102,136 | 73,790 | ||||||||||||
Basic and diluted net loss per share | $ | (0.10 | ) | $ | (0.21 | ) | $ | (0.44 | ) | $ | (0.63 | ) | ||||
Schedule of Calculation of Diluted Net Loss Per Share | ' | |||||||||||||||
The following table presents potentially dilutive securities not included in the calculation of diluted net loss per share because to do so would be anti-dilutive (in thousands, of common equivalent shares): | ||||||||||||||||
Three and Nine Months Ended | ||||||||||||||||
September 30, | ||||||||||||||||
2013 | 2012 | |||||||||||||||
Common stock options and restricted stock units | 1,776 | 6,542 | ||||||||||||||
Common stock warrants | — | 15,784 | ||||||||||||||
1,776 | 22,326 | |||||||||||||||
Inventory_net_Tables
Inventory, net (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Disclosure Inventory Net [Abstract] | ' | |||||||
Inventory, Net | ' | |||||||
September 30, 2013 | December 31, 2012 | |||||||
Raw materials | $ | 3,329 | $ | 4,867 | ||||
Work in process | 4,863 | 6,134 | ||||||
Finished goods | 3,897 | 1,885 | ||||||
$ | 12,089 | $ | 12,886 | |||||
Restructuring_Tables
Restructuring (Tables) | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Restructuring and Related Activities [Abstract] | ' | ||||||||||||
Summary of Components of Restructuring Charges | ' | ||||||||||||
The following table summarizes the components of the restructuring charges for the nine months ended September 30, 2013 (in thousands): | |||||||||||||
Nine Months Ended September 30, 2013 | |||||||||||||
Accruals | Non-cash items | Total | |||||||||||
Employee-related charges | $ | 663 | $ | 201 | $ | 864 | |||||||
Other restructuring charges | 12 | — | 12 | ||||||||||
$ | 675 | $ | 201 | $ | 876 | ||||||||
Schedule of Activity of Restructuring Charges | ' | ||||||||||||
The following table sets forth activity in the restructuring liability for the nine months ended September 30, 2013, which is primarily comprised of employee severance costs (in thousands): | |||||||||||||
Employee severance costs | Other restructuring charges | Total | |||||||||||
Balance at December 31, 2012 | $ | — | — | $ | — | $ | — | ||||||
Accruals | 663 | 12 | 675 | ||||||||||
Payments | (657 | ) | (12 | ) | (669 | ) | |||||||
Balance at September 30, 2013 | $ | 6 | $ | — | $ | 6 | |||||||
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||||||
Assumptions used in the Black-Scholes Option-Pricing Model | ' | |||||||||||||||
The assumptions used in the Black-Scholes option-pricing model for the three and nine months ended September 30, 2013 and 2012 are as follows: | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Risk free interest rate | 1.5% to 1.7% | 0.7% to 0.9% | 0.8% to 1.7% | 0.2% to 1.2% | ||||||||||||
Expected term | 5.1 to 6.0 years | 5.0 to 6.1 years | 5.0 to 6.1 years | 5.0 to 6.1 years | ||||||||||||
Expected volatility | 82.8% to 83.9% | 80.1% to 81.7% | 82.8% to 87.9% | 80.1% to 82.8% | ||||||||||||
Expected dividend yield | — | % | — | % | — | % | — | % | ||||||||
Stock-Based Compensation Expense | ' | |||||||||||||||
The Company recognized stock-based compensation expense as follows (in thousands): | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Cost of sales | $ | 119 | $ | 53 | $ | 227 | $ | 130 | ||||||||
Research and development | 316 | 256 | 782 | 687 | ||||||||||||
Selling, general and administrative | 1,780 | 1,433 | 4,570 | 3,721 | ||||||||||||
Restructuring | — | — | 201 | — | ||||||||||||
Total | $ | 2,215 | $ | 1,742 | $ | 5,780 | $ | 4,538 | ||||||||
Organization_and_Basis_of_Pres1
Organization and Basis of Presentation Narrative (Details) (USD $) | 9 Months Ended | |
In Millions, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Mar. 27, 2013 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | ' |
Common stock value authorized for controlled sale | ' | $25 |
Common stock, shares issued | 6.8 | ' |
Common stock issued and sold, price per share | $1.66 | ' |
Proceeds from Issuance of Common Stock | 10.9 | ' |
Common Stock, Capital Shares Reserved for Future Issuance, Value | $13.80 | ' |
Summary_of_Significant_Account3
Summary of Significant Accounting Policies - Additional Information (Details) (USD $) | 3 Months Ended | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Mar. 31, 2013 | Sep. 30, 2013 |
segment | |||
Accounting Policies [Abstract] | ' | ' | ' |
Increase in accrued product returns | $2,408 | $1,226 | ' |
Number of business segments | ' | ' | 1 |
Summary_of_Significant_Account4
Summary of Significant Accounting Policies - Assets and Liabilities Measured at Fair Value on a Recurring Basis (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | ||||||||||||||||||||||||
In Thousands, unless otherwise specified | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Significant Other Observable Inputs (Level 2) [Member] | Significant Other Observable Inputs (Level 2) [Member] | Significant Other Observable Inputs (Level 2) [Member] | Significant Other Observable Inputs (Level 2) [Member] | Significant Other Observable Inputs (Level 2) [Member] | Significant Other Observable Inputs (Level 2) [Member] | Significant Unobservable Inputs (Level 3) [Member] | Significant Unobservable Inputs (Level 3) [Member] | Significant Unobservable Inputs (Level 3) [Member] | Significant Unobservable Inputs (Level 3) [Member] | Significant Unobservable Inputs (Level 3) [Member] | Significant Unobservable Inputs (Level 3) [Member] | Estimate of Fair Value, Fair Value Disclosure [Member] | Estimate of Fair Value, Fair Value Disclosure [Member] | Estimate of Fair Value, Fair Value Disclosure [Member] | Estimate of Fair Value, Fair Value Disclosure [Member] | Estimate of Fair Value, Fair Value Disclosure [Member] | Estimate of Fair Value, Fair Value Disclosure [Member] | Minimum [Member] | ||||||||||||||||||||||||
Common Stock Warrant Liabilities [Member] | Common Stock Warrant Liabilities [Member] | Embedded Derivative Liabilities [Member] | Embedded Derivative Liabilities [Member] | Money market fund shares [Member] | Money market fund shares [Member] | Common Stock Warrant Liabilities [Member] | Common Stock Warrant Liabilities [Member] | Embedded Derivative Liabilities [Member] | Embedded Derivative Liabilities [Member] | Money market fund shares [Member] | Money market fund shares [Member] | Common Stock Warrant Liabilities [Member] | Common Stock Warrant Liabilities [Member] | Embedded Derivative Liabilities [Member] | Embedded Derivative Liabilities [Member] | Money market fund shares [Member] | Money market fund shares [Member] | Common Stock Warrant Liabilities [Member] | Common Stock Warrant Liabilities [Member] | Embedded Derivative Liabilities [Member] | Embedded Derivative Liabilities [Member] | Money market fund shares [Member] | Money market fund shares [Member] | ||||||||||||||||||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Maximum volatility rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 40.00% | ||||||||||||||||||||||||
Assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Assets measured at fair value on a recurring basis | ' | ' | ' | ' | $8,116 | [1] | $37,605 | [1] | ' | ' | ' | ' | $0 | [1] | $0 | [1] | ' | ' | ' | ' | $0 | [1] | $0 | [1] | ' | ' | ' | ' | $8,116 | [1] | $37,605 | [1] | ' | ||||||||||||||||
Liabilities | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Liabilities measured at fair value on a recurring basis | $0 | [2] | $0 | [2] | $0 | [3] | $0 | [3] | ' | ' | $0 | [2] | $0 | [2] | $0 | [3] | $0 | [3] | ' | ' | $12,273 | [2] | $9,493 | [2] | $80 | [3] | $992 | [3] | ' | ' | $12,273 | [2] | $9,493 | [2] | $80 | [3] | $992 | [3] | ' | ' | ' | ||||||||
[1] | Cash equivalents are comprised of money market fund shares and are included as a component of cash and cash equivalents on the consolidated balance sheets. | ||||||||||||||||||||||||||||||||||||||||||||||||
[2] | Common stock warrant liabilities include liabilities associated with warrants issued in connection with the Company's July 2012 public offering of common stock and warrants (see Note 6) and warrants issued in connection with the Healthcare Royalty financing agreement (see Note 4), which are measured at fair value using the Black-Scholes option pricing valuation model. The assumptions used in the Black-Scholes option pricing valuation model for both common stock warrant liabilities were: (a) a risk-free interest rate based on the rates for U.S. Treasury zero-coupon bonds with maturities similar to those of the remaining contractual term of the warrants; (b) an assumed dividend yield of zero based on the Company’s expectation that it will not pay dividends in the foreseeable future; (c) an expected term based on the remaining contractual term of the warrants; and (d) given the Company’s lack of relevant historical data due to the Company’s limited historical experience, an expected volatility based upon the Company's historical volatility, supplemented with historical volatility of comparable companies whose share prices have been publicly available for a sufficient period of time. The significant unobservable input used in measuring the fair value of the common stock warrant liabilities associated with the Healthcare Royalty financing agreement is the expected volatility. Significant increases in volatility would result in a higher fair value measurement. The following additional assumptions were used in the Black-Scholes option pricing valuation model to measure the fair value of the warrants sold in the July 2012 public offering: (a) management’s projections regarding the probability of the occurrence of an extraordinary event that would require cash settlement of the warrants; and for the valuation scenario in which an extraordinary event occurs, (b) a volatility rate equal to the lesser of 40% and the 180-day volatility rate obtained from the HVT function on Bloomberg as of the trading day immediately following the public announcement of an extraordinary transaction. The significant unobservable inputs used in measuring the fair value of the common stock warrant liabilities associated with the July 2012 public offering are the expected volatility and the probability of the occurrence of an extraordinary event. Significant increases in volatility would result in a higher fair value measurement and significant increases in the probability of an extraordinary event occurring would result in a significantly lower fair value measurement. | ||||||||||||||||||||||||||||||||||||||||||||||||
[3] | Embedded derivative liabilities measured at fair value using various discounted cash flow valuation models are included as a component of other long-term liabilities on the consolidated balance sheets. The assumptions used in the discounted cash flow valuation models include: (a) management’s revenue projections and a revenue sensitivity analysis based on possible future outcomes; (b) probability weighted net cash flows based on the likelihood of Healthcare Royalty receiving revenue interest payments over the term of the financing agreement; (c) probability of bankruptcy; (d) weighted average cost of capital that included the addition of a company specific risk premium to account for uncertainty associated with the Company achieving future cash flows; (e) the probability of a change in control occurring during the term of the Healthcare Royalty financing agreement; and (f) the probability of an exercise of the embedded derivative instruments. The significant unobservable inputs used in measuring the fair value of the embedded derivatives are management’s revenue projections. Significant decreases in these significant inputs would result in a higher fair value measurement. |
Summary_of_Significant_Account5
Summary of Significant Accounting Policies - Reconciliation of Liabilities Measured at Fair Value Using Significant Observable Inputs Level 3 (Detail) (USD $) | 9 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 |
Warrants and Rights Outstanding [Member] | ' |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ' |
Beginning Balance | $9,493 |
Changes in fair value | 2,780 |
Ending Balance | 12,273 |
Embedded Derivative Liabilities [Member] | ' |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ' |
Beginning Balance | 992 |
Changes in fair value | -912 |
Ending Balance | $80 |
Summary_of_Significant_Account6
Summary of Significant Accounting Policies - Basic and Diluted Net Loss Per Share (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Numerator | ' | ' | ' | ' |
Net loss | ($10,852) | ($19,282) | ($45,240) | ($46,743) |
Denominator | ' | ' | ' | ' |
Weighted average shares outstanding, basic and diluted | 104,682 | 90,370 | 102,136 | 73,790 |
Basic and diluted net loss per share (usd per share) | ($0.10) | ($0.21) | ($0.44) | ($0.63) |
Summary_of_Significant_Account7
Summary of Significant Accounting Policies - Schedule of Calculation of Diluted Net Loss Per Share (Detail) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Anti-dilutive securities excluded from computation of earnings per share amount | 1,776 | 22,326 | 1,776 | 22,326 |
Common stock options and restricted stock units | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Anti-dilutive securities excluded from computation of earnings per share amount | 1,776 | 6,542 | 1,776 | 6,542 |
Common Stock Warrants [Member] | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Anti-dilutive securities excluded from computation of earnings per share amount | 0 | 15,784 | 0 | 15,784 |
Inventory_Net_Detail
Inventory, Net (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Disclosure Inventory Net [Abstract] | ' | ' |
Raw materials | $3,329 | $4,867 |
Work in process | 4,863 | 6,134 |
Finished goods | 3,897 | 1,885 |
Inventory, net | $12,089 | $12,886 |
Collaboration_and_Financing_Ag1
Collaboration and Financing Agreements - Additional Information (Detail) (USD $) | 0 Months Ended | 3 Months Ended | 9 Months Ended | 0 Months Ended | 49 Months Ended | 0 Months Ended | 9 Months Ended | 0 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 9 Months Ended | 9 Months Ended | 9 Months Ended | 0 Months Ended | 3 Months Ended | 9 Months Ended | 1 Months Ended | 3 Months Ended | 9 Months Ended | 1 Months Ended | 0 Months Ended | 3 Months Ended | 9 Months Ended | |||||||||||||||||||||||||||||
Jul. 18, 2011 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Jul. 30, 2012 | Jul. 30, 2012 | Sep. 30, 2013 | Jun. 30, 2011 | Jul. 30, 2012 | Jun. 30, 2011 | Jun. 30, 2008 | Sep. 30, 2013 | Jul. 18, 2011 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Jul. 18, 2011 | Sep. 30, 2013 | Sep. 30, 2012 | Jul. 18, 2011 | Sep. 30, 2013 | Jul. 18, 2011 | Sep. 30, 2013 | Jul. 18, 2011 | Sep. 30, 2013 | Sep. 30, 2013 | Jul. 18, 2011 | Sep. 30, 2013 | Jul. 18, 2011 | Jun. 06, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Aug. 31, 2012 | Jul. 31, 2009 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jul. 31, 2013 | Dec. 31, 2012 | Dec. 20, 2011 | Jul. 31, 2009 | Jul. 31, 2009 | Jun. 27, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | |
Oxford/SVB [Member] | Oxford/SVB [Member] | Oxford/SVB [Member] | Oxford/SVB [Member] | Oxford/SVB [Member] | Oxford/SVB [Member] | Loan And Security Agreement [Member] | Embedded Derivative Liabilities [Member] | Healthcare Royalty Financing Agreement [Member] | Healthcare Royalty Financing Agreement [Member] | Healthcare Royalty Financing Agreement [Member] | Healthcare Royalty Financing Agreement [Member] | Healthcare Royalty Financing Agreement [Member] | Healthcare Royalty Financing Agreement [Member] | Healthcare Royalty Financing Agreement [Member] | Healthcare Royalty Financing Agreement [Member] | Healthcare Royalty Financing Agreement [Member] | Healthcare Royalty Financing Agreement [Member] | Healthcare Royalty Financing Agreement [Member] | Healthcare Royalty Financing Agreement [Member] | Healthcare Royalty Financing Agreement [Member] | Healthcare Royalty Financing Agreement [Member] | Healthcare Royalty Financing Agreement [Member] | Healthcare Royalty Financing Agreement [Member] | Healthcare Royalty Financing Agreement [Member] | Minimum [Member] | Minimum [Member] | Maximum [Member] | Maximum [Member] | Mallinckrodt LLC Co-Promotion Agreement [Member] | Mallinckrodt LLC Co-Promotion Agreement [Member] | Mallinckrodt LLC Co-Promotion Agreement [Member] | Mallinckrodt LLC Co-Promotion Agreement [Member] | Mallinckrodt LLC Co-Promotion Agreement [Member] | Astellas Pharma Us Inc Co Promotion Agreement [Member] | Astellas Pharma Us Inc Co Promotion Agreement [Member] | Astellas Pharma Us Inc Co Promotion Agreement [Member] | Astellas Pharma Us Inc Co Promotion Agreement [Member] | Astellas Pharma Us Inc Co Promotion Agreement [Member] | Astellas Pharma Us Inc Co Promotion Agreement [Member] | Astellas Pharma Us Inc Co Promotion Agreement [Member] | Astellas Pharma Us Inc Co Promotion Agreement [Member] | Astellas Pharma Us Inc Co Promotion Agreement [Member] | Astellas Pharma Us Inc Co Promotion Agreement [Member] | Astellas Pharma Us Inc Co Promotion Agreement [Member] | Valeant Pharmaceuticals North America LLC Co-Promotions Agreement [Member] | Valeant Pharmaceuticals North America LLC Co-Promotions Agreement [Member] | Valeant Pharmaceuticals North America LLC Co-Promotions Agreement [Member] | |||||||
Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Embedded Derivative Liabilities [Member] | Embedded Derivative Liabilities [Member] | Embedded Derivative Liabilities [Member] | Embedded Derivative Liabilities [Member] | Common Stock Warrant Liabilities [Member] | Common Stock Warrant Liabilities [Member] | Common Stock Warrant Liabilities [Member] | Scenario 1 [Member] | Scenario 1 [Member] | Scenario 2 [Member] | Scenario 2 [Member] | Scenario 3 [Member] | Oxford/SVB [Member] | Healthcare Royalty Financing Agreement [Member] | Oxford/SVB [Member] | Healthcare Royalty Financing Agreement [Member] | tail_payments | Minimum [Member] | Maximum [Member] | ||||||||||||||||||||||||||||||||||
Scenario 1 [Member] | Scenario 1 [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Company Entered Into Co Promotion Agreement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '2009-07 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of Credit Facility, Interest Rate During Period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3.29% | ' | 7.29% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Co-Promotion Agreement, Renewal Period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '6 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sales Period For Tail Payment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '12 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Co-promotion agreement termination notice period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '60 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '6 months | ' | ' |
Co-promotion agreement termination notice period for net sales contingency | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '60 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '30 days | ' | ' |
Co-promotion agreement termination notice period for change of control contingency | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '90 days | ' | ' |
Service and other revenue | ' | $271,000 | $0 | $398,000 | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $232,000 | $232,000 |
Incurred Service Fee Expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 249,000 | 92,000 | 618,000 | 92,000 | ' | ' | ' | ' | 0 | 1,757,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Additional term increments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '12 months | ' | ' |
Non-refundable up-front payment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Milestone Payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 18,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Service Fee Rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 45.00% | 55.00% | ' | ' | ' |
Deferred Agreement Payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred contract revenues | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8,462,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number Of Annual Tail Payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Tail payment liability related interest expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 40,000 | 93,000 | 327,000 | 414,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Service fee reduction | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Tail payment liability | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,090,000 | ' | 1,090,000 | ' | ' | 2,795,000 | 5,291,000 | ' | ' | ' | ' | ' |
Tail payment liability, first payment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,000,000 | ' | ' | ' | ' | ' | ' | ' |
Reduction to tail payment liability | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 742,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Present value of the service fee receivable and tail payment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,924,000 | ' | ' | ' | ' | ' | ' |
Recognized shared marketing expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 253,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Debt instrument, outstanding | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 18,000,000 | ' | 30,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock issued and sold to Healthcare Royalty, amount | ' | 108,000 | ' | 108,000 | ' | 101,000 | ' | ' | ' | ' | ' | ' | ' | ' | 1,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock issued and sold to Healthcare Royalty, shares | ' | 6,800,000 | ' | 6,800,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 388,601 | ' | 388,601 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock issued and sold to Healthcare Royalty, price per share | ' | $1.66 | ' | $1.66 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $3.86 | ' | $3.86 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warrant exercisable to Healthcare Royalty, shares | 225,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warrant exercisable to Healthcare Royalty, price per share (usd per share) | $9 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $9 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Term of warrant exercisable | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '10 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenue Interest Rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.50% | ' | 0.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5.00% | ' | 2.50% | 0.50% | ' | 5.00% | ' | 5.75% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net product sales amount received | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | 75,000,000 | ' | 75,000,000 | ' | 150,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fixed Debt Repayment Dates | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'January 31, 2015, January 31, 2016 and January 31, 2017 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fixed Payments for Jan 31,2015 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,000,000 | ' | 10,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fixed Payments for Jan 31,2016 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,000,000 | ' | 10,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fixed Payments for Jan 31,2017 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,000,000 | ' | 10,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Agreement Expiration Date | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '2014-06-30 | ' | ' | ' | ' | ' | '2012-03-31 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Agreement termination date | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 31-Mar-18 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intercreditor loan | ' | 25,000,000 | ' | 25,000,000 | ' | ' | ' | ' | ' | 25,000,000 | ' | 10,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Terminate payment base amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 75,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | 52,500,000 | ' | 45,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Borrowed internal rate of return | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 19.00% | ' | 17.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fair value of embedded derivatives | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 80,000 | ' | 992,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Aggregate net proceed from financing agreement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 29,485,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Financing discounts | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 476,000 | ' | ' | ' | ' | ' | ' | ' | 605,000 | ' | ' | 790,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other income (expense) | ' | 67,000 | -1,421,000 | 90,000 | -1,379,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -8,000 | -23,000 | -43,000 | -65,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Change in fair value | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -912,000 | ' | ' | ' | ' | ' | 912,000 | 166,000 | ' | ' | 1,474,000 | -202,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revolving credit facility | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Term loan, interest rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | 12.06% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revolving credit facility, interest rate | ' | ' | ' | ' | ' | ' | ' | 'equal to the greater of 3.29% above SVB’s prime rate or 7.29% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage paid for unused portion of revolving credit facility | ' | ' | ' | ' | ' | ' | ' | 0.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Principal and interest repaid | ' | ' | ' | 0 | 40,051,000 | ' | 19,492,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Final Payment to Terminate Debt | ' | ' | ' | ' | ' | ' | 1,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Prepayment Premium to Terminate Debt | ' | ' | ' | ' | ' | ' | $400,000 | ' | ' | ' | $100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of principal as per payment premium | ' | ' | ' | ' | ' | ' | ' | ' | 2.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Financing Agreement Termination Date | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '2013-06 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring_Additional_Infor
Restructuring - Additional Information (Details) (USD $) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
In Thousands, unless otherwise specified | 31-May-13 | Sep. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
employee | ||||||
Restructuring and Related Activities [Abstract] | ' | ' | ' | ' | ' | ' |
Employees reduced | 55 | ' | ' | ' | ' | ' |
Restructuring | ' | $0 | $876 | $0 | $876 | $0 |
Restructuring_Components_of_Re
Restructuring - Components of Resctructuing (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Restructuring Cost and Reserve [Line Items] | ' | ' | ' | ' | ' |
Accruals | ' | ' | ' | $675 | ' |
Non-cash items | ' | ' | ' | 201 | 0 |
Total | 0 | 876 | 0 | 876 | 0 |
Employee-related charges [Member] | ' | ' | ' | ' | ' |
Restructuring Cost and Reserve [Line Items] | ' | ' | ' | ' | ' |
Accruals | ' | ' | ' | 663 | ' |
Non-cash items | ' | ' | ' | 201 | ' |
Total | ' | ' | ' | 864 | ' |
Other restructuring charges [Member] | ' | ' | ' | ' | ' |
Restructuring Cost and Reserve [Line Items] | ' | ' | ' | ' | ' |
Accruals | ' | ' | ' | 12 | ' |
Non-cash items | ' | ' | ' | 0 | ' |
Total | ' | ' | ' | $12 | ' |
Restructuring_Reserve_Rollfowa
Restructuring - Reserve Rollfoward (Details) (USD $) | 9 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 |
Restructuring Reserve [Roll Forward] | ' |
Balance at beginning of period | $0 |
Accruals | 675 |
Payments | -669 |
Balance at end of period | 6 |
Employee-related charges [Member] | ' |
Restructuring Reserve [Roll Forward] | ' |
Balance at beginning of period | 0 |
Accruals | 663 |
Payments | -657 |
Balance at end of period | 6 |
Other restructuring charges [Member] | ' |
Restructuring Reserve [Roll Forward] | ' |
Balance at beginning of period | 0 |
Accruals | 12 |
Payments | -12 |
Balance at end of period | $0 |
Common_Stock_Warrants_Addition
Common Stock Warrants - Additional Informational (Detail) (USD $) | 0 Months Ended | 1 Months Ended | ||||||
In Thousands, except Share data, unless otherwise specified | Jul. 27, 2012 | Jul. 18, 2011 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Jun. 30, 2011 | Dec. 31, 2011 |
Healthcare Royalty | Healthcare Royalty | Oxford/SVB [Member] | Oxford/SVB [Member] | |||||
Schedule Of Common Stock [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Shares of common stock exercisable through warrants | 15,784,200 | ' | ' | ' | ' | ' | 26,455 | ' |
Warrants exercisable date | 27-Jul-13 | ' | ' | ' | ' | ' | ' | ' |
Warrants exercise price per share | $2.50 | ' | ' | ' | ' | ' | $3.78 | ' |
Warrants expiry date | 'July 27, 2017 | ' | ' | ' | ' | ' | ' | ' |
Term of common stock warrant exercisable (years) | '5 years | '10 years | ' | ' | ' | ' | '7 years | ' |
Fair value of warrant liabilities | ' | ' | $12,045 | $9,308 | $228 | $185 | ' | ' |
Warrant exercisable to Healthcare Royalty, shares | ' | 225,000 | ' | ' | ' | ' | ' | ' |
Warrant exercisable to Healthcare Royalty, price per share (usd per share) | ' | $9 | ' | ' | ' | ' | ' | ' |
Unamortized debt discount | ' | ' | ' | ' | ' | ' | ' | $76 |
StockBased_Compensation_Assump
Stock-Based Compensation - Assumptions used in Black-Scholes Option-Pricing Model (Detail) (Stock Options [Member]) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Risk free interest rate , minimum | 1.50% | 0.70% | 0.80% | 0.20% |
Risk free interest rate, maximum | 1.70% | 0.90% | 1.70% | 1.20% |
Expected volatility, minimum | 82.80% | 80.10% | 82.80% | 80.10% |
Expected volatility, maximum | 83.90% | 81.70% | 87.90% | 82.80% |
Expected dividend yield | 0.00% | 0.00% | 0.00% | 0.00% |
Minimum [Member] | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Expected term | '5 years 1 month 6 days | '5 years | '5 years | '5 years |
Maximum [Member] | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Expected term | '6 years | '6 years 1 month 6 days | '6 years 1 month 6 days | '6 years 1 month 6 days |
StockBased_Compensation_Expens
Stock-Based Compensation - Expense (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Stock-based compensation expense | $2,215 | $1,742 | $5,780 | $4,538 |
Cost of sales | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Stock-based compensation expense | 119 | 53 | 227 | 130 |
Research and development | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Stock-based compensation expense | 316 | 256 | 782 | 687 |
Selling, general and administrative | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Stock-based compensation expense | 1,780 | 1,433 | 4,570 | 3,721 |
Restructuring | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Stock-based compensation expense | $0 | $0 | $201 | $0 |
StockBased_Compensation_Additi
Stock-Based Compensation - Additional Information (Detail) (Stock Options [Member], USD $) | 9 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 |
Stock Options [Member] | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Total unrecognized compensation costs | $12,898 |
Recognition over weighted average periods | '2 years 8 months 2 days |
Subsequent_Event_Details
Subsequent Event (Details) (Subsequent Event [Member], Altus Formulation Inc. Development and Option Agreement [Member], USD $) | 0 Months Ended |
Nov. 03, 2013 | |
Subsequent Event [Member] | Altus Formulation Inc. Development and Option Agreement [Member] | ' |
Subsequent Event [Line Items] | ' |
Non-refundable up-front payment | $750,000 |
Milestone Payments | $3,500,000 |
Termination notice period | '30 days |