Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Mar. 03, 2014 | Jun. 28, 2013 | |
Document and Entity Information [Abstract] | ' | ' | ' |
Entity Registrant Name | 'ZOGENIX, INC. | ' | ' |
Entity Central Index Key | '0001375151 | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Filer Category | 'Accelerated Filer | ' | ' |
Document Type | '10-K | ' | ' |
Document Period End Date | 31-Dec-13 | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Amendment Flag | 'false | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 139,539,151 | ' |
Entity Well-known Seasoned Issuer | 'No | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Public Float | ' | ' | $107,302,329 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $72,021 | $41,228 |
Trade accounts receivable, net | 6,665 | 5,643 |
Inventory | 9,936 | 12,886 |
Prepaid expenses and other current assets | 4,257 | 1,968 |
Total current assets | 92,879 | 61,725 |
Property and equipment, net | 13,011 | 13,561 |
Other assets | 6,614 | 5,400 |
Total assets | 112,504 | 80,686 |
Current liabilities: | ' | ' |
Accounts payable | 4,622 | 4,592 |
Accrued expenses | 18,865 | 14,343 |
Common stock warrant liabilities | 31,341 | 9,493 |
Accrued compensation | 3,952 | 4,226 |
Total current liabilities | 58,780 | 32,654 |
Long-term debt | 28,802 | 28,481 |
Other long-term liabilities | 6,496 | 5,078 |
Commitments and contingencies | ' | ' |
Stockholders’ equity: | ' | ' |
Common stock, $0.001 par value; 200,000 shares authorized at December 31, 2013 and 2012; 138,927 and 100,809 shares issued and outstanding at December 31, 2013 and 2012, respectively. | 139 | 101 |
Additional paid-in capital | 428,534 | 343,763 |
Accumulated deficit | -410,247 | -329,391 |
Total stockholders’ equity | 18,426 | 14,473 |
Total liabilities and stockholders’ equity | $112,504 | $80,686 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Statement of Financial Position [Abstract] | ' | ' |
Common stock, par value (in usd per share) | $0.00 | $0.00 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common Stock, Shares, Issued | 138,927,000 | 100,809,000 |
Common stock, shares outstanding | 138,927,000 | 100,809,000 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations and Comprehensive Loss (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Revenue: | ' | ' | ' |
Net product revenue | $31,699 | $35,826 | $30,411 |
Contract revenue | 0 | 8,462 | 7,165 |
Service and other revenue | 1,313 | 38 | 0 |
Total revenue | 33,012 | 44,326 | 37,576 |
Operating expenses: | ' | ' | ' |
Cost of sales | 21,241 | 19,496 | 19,293 |
Royalty expense | 1,242 | 1,353 | 1,205 |
Research and development | 12,805 | 21,414 | 33,043 |
Selling, general and administrative | 50,040 | 49,494 | 60,459 |
Restructuring | 876 | 0 | 0 |
Total operating expenses | 86,204 | 91,757 | 114,000 |
Loss from operations | -53,192 | -47,431 | -76,424 |
Other income (expense): | ' | ' | ' |
Interest income | 18 | 53 | 37 |
Interest expense | -6,610 | -10,313 | -7,644 |
Change in fair value of warrant liabilities | -21,927 | 11,811 | 445 |
Change in fair value of embedded derivatives | 759 | -147 | -240 |
Other income (expense) | 96 | -1,354 | -86 |
Total other income (expense) | -27,664 | 50 | -7,488 |
Loss before income taxes | -80,856 | -47,381 | -83,912 |
Provision for income tax benefit (expense) | 0 | -5 | 9 |
Net loss | -80,856 | -47,386 | -83,903 |
Net loss per share, basic and diluted | ($0.74) | ($0.59) | ($1.96) |
Weighted average shares outstanding, basic and diluted | 108,568 | 80,558 | 42,712 |
Comprehensive loss | ($80,856) | ($47,386) | ($83,903) |
Consolidated_Statement_of_Stoc
Consolidated Statement of Stockholders' Equity (USD $) | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] |
In Thousands, except Share data, unless otherwise specified | ||||
Beginning balance at Dec. 31, 2010 | $28,734 | $34 | $226,802 | ($198,102) |
Beginning balance, shares at Dec. 31, 2010 | ' | 34,017,000 | ' | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' |
Net loss and comprehensive loss | -83,903 | 0 | 0 | -83,903 |
Issuance of common stock from secondary offering, net of issuance costs of $3,564 | 57,859 | 31 | 57,828 | 0 |
Issuance of common stock from secondary offering, net of issuance costs of $3,564, shares | ' | 30,712,000 | ' | ' |
Issuance of common stock from financing agreement at $3.86 per share, net of issuance costs of $96 | 1,404 | 0 | 1,404 | 0 |
Issuance of common stock from financing agreement at $3.86 per share, net of issuance costs of $96, shares | ' | 389,000 | ' | ' |
Issuance of common stock in conjunction with exercise of stock options | 92 | 0 | 92 | 0 |
Issuance of common stock in conjunction with exercise of stock options, shares | ' | 67,000 | ' | ' |
Issuance of common stock from ESPP purchase | 263 | 0 | 263 | 0 |
Issuance of common stock from ESPP purchase, shares | ' | 172,000 | ' | ' |
Issuance of common stock warrants | 39 | 0 | 39 | 0 |
Release of restricted stock units | 0 | 0 | 0 | 0 |
Release of restricted stock units, shares | ' | 12,000 | ' | ' |
Vesting of early exercised stock options | 15 | 0 | 15 | 0 |
Stock-based compensation | 4,809 | 0 | 4,809 | 0 |
Ending balance at Dec. 31, 2011 | 9,312 | 65 | 291,252 | -282,005 |
Ending balance, shares at Dec. 31, 2011 | ' | 65,369,000 | ' | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' |
Net loss and comprehensive loss | -47,386 | 0 | 0 | -47,386 |
Issuance of common stock, net of issuance costs | 45,809 | 35 | 45,774 | 0 |
Issuance of common stock, net of issuance costs, shares | ' | 35,058,000 | ' | ' |
Issuance of common stock in conjunction with exercise of stock options | 33 | 0 | 33 | 0 |
Issuance of common stock in conjunction with exercise of stock options, shares | ' | 18,000 | ' | ' |
Issuance of common stock from ESPP purchase | 548 | 1 | 547 | 0 |
Issuance of common stock from ESPP purchase, shares | ' | 364,000 | ' | ' |
Stock-based compensation | 6,157 | 0 | 6,157 | 0 |
Ending balance at Dec. 31, 2012 | 14,473 | 101 | 343,763 | -329,391 |
Ending balance, shares at Dec. 31, 2012 | ' | 100,809,000 | ' | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' |
Net loss and comprehensive loss | -80,856 | 0 | 0 | -80,856 |
Issuance of common stock, net of issuance costs | 64,471 | 31 | 64,440 | 0 |
Issuance of common stock, net of issuance costs, shares | ' | 30,667,000 | ' | ' |
Issuance of common stock from initial public offering, net of issuance costs of $6,013 | 10,834 | 7 | 10,827 | 0 |
Issuance of common stock from initial public offering, net of issuance costs of $6,013, shares | 6,753,104 | 6,753,000 | ' | ' |
Issuance of common stock in conjunction with exercise of stock options | 574 | 0 | 574 | 0 |
Issuance of common stock in conjunction with exercise of stock options, shares | 291,000 | 291,000 | ' | ' |
Issuance of common stock from ESPP purchase | 385 | 0 | 385 | 0 |
Issuance of common stock from ESPP purchase, shares | ' | 304,000 | ' | ' |
Stock Issued During Period, Value, Conversion of Convertible Securities | 338 | 0 | 338 | 0 |
Stock Issued During Period, Shares, Conversion of Convertible Securities | ' | 103,000 | ' | ' |
Stock-based compensation | 8,006 | 0 | 8,006 | 0 |
Share-based compensation, restructuring | 201 | ' | 201 | ' |
Ending balance at Dec. 31, 2013 | $18,426 | $139 | $428,534 | ($410,247) |
Ending balance, shares at Dec. 31, 2013 | ' | 138,927,000 | ' | ' |
Consolidated_Statement_of_Stoc1
Consolidated Statement of Stockholders' Equity (Deficit) (Parenthetical) (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Statement of Stockholders' Equity [Abstract] | ' | ' | ' |
Issuance costs of common stock from secondary offering | $4,529 | ' | $3,564 |
Issuance costs of common stock from conversion of convertible notes | ' | ' | 18 |
Issuance costs of common stock from financing agreement, (in usd per share) | ' | ' | $3.86 |
Issuance of common stock from financing agreement, issuance cost | ' | ' | 96 |
Issuance costs of common stock from July 2012 offering | ' | 3,328 | ' |
Issuance costs of controlled equity offering | $371 | ' | ' |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Operating activities: | ' | ' | ' |
Net loss | ($80,856) | ($47,386) | ($83,903) |
Adjustments to reconcile net loss to net cash used in operating activities: | ' | ' | ' |
Stock-based compensation | 8,006 | 6,157 | 4,809 |
Stock-based compensation, restructuring | 201 | 0 | 0 |
Depreciation | 1,806 | 1,599 | 1,584 |
Amortization of debt issuance costs and non-cash interest | 569 | 2,017 | 1,793 |
Change in fair value of warrant liabilities | 21,927 | -11,811 | -445 |
Change in fair value of embedded derivatives | -759 | 147 | 240 |
Loss on disposal and impairment of property and equipment | 0 | 9 | 0 |
Changes in operating assets and liabilities: | ' | ' | ' |
Trade accounts receivable | -1,022 | -730 | -439 |
Inventory | 2,950 | 3,890 | 1,517 |
Prepaid expenses and other current assets | -2,004 | 163 | 24 |
Other assets | -1,747 | 11 | 338 |
Accounts payable and accrued expenses | 6,142 | 2,194 | 4,898 |
Restructuring liabilities | 4 | 0 | 0 |
Deferred revenue | -137 | -8,462 | -10,887 |
Net cash used in operating activities | -44,920 | -52,202 | -80,471 |
Investing activities: | ' | ' | ' |
Purchases of property and equipment | -810 | -293 | -617 |
Net cash used in investing activities | -810 | -293 | -617 |
Financing activities: | ' | ' | ' |
Proceeds from borrowings of debt and revolving credit facility, net of issuance costs | 0 | 9,900 | 39,124 |
Payments on borrowings of debt | 0 | -25,000 | -825 |
Payments on revolving credit facility | 0 | -15,051 | -9,477 |
Proceeds from exercise of common stock options and warrants | 833 | 33 | 92 |
Proceeds from issuance of common stock and common stock warrants, net of issuance costs | 75,690 | 67,316 | 59,527 |
Net cash provided by financing activities | 76,523 | 37,198 | 88,441 |
Net (decrease) increase in cash and cash equivalents | 30,793 | -15,297 | 7,353 |
Cash and cash equivalents at beginning of period | 41,228 | 56,525 | 49,172 |
Cash and cash equivalents at end of period | 72,021 | 41,228 | 56,525 |
Supplemental disclosure of cash flow information: | ' | ' | ' |
Cash paid for interest | 2,463 | 5,284 | 4,186 |
Noncash investing and financing activities: | ' | ' | ' |
Purchase of property and equipment in accounts payable | 446 | 0 | 123 |
Change in common stock warrant liability associated with exercise of warrants | -79 | 0 | 0 |
Warrants issued in connection with public offering | 0 | 20,959 | 0 |
Asset retirement obligation | 0 | 286 | 0 |
Warrants issued in connection with debt | 0 | 0 | 866 |
Embedded derivatives related to debt | 0 | 0 | 605 |
Vesting of early exercised stock options | $0 | $0 | $15 |
Organization_and_Basis_of_Pres
Organization and Basis of Presentation | 12 Months Ended |
Dec. 31, 2013 | |
Disclosure Organization And Basis Of Presentation Additional Information [Abstract] | ' |
Organization and Basis of Presentation | ' |
Organization and Basis of Presentation | |
Zogenix, Inc. (the Company) is a pharmaceutical company committed to developing and commercializing therapies that address specific clinical needs for people living with pain-related conditions and central nervous system disorders who need innovative treatment alternatives to help them return to normal daily functioning. 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. 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 launched Zohydro ER on March 3, 2014. | |
The Company was incorporated in the state of Delaware on May 11, 2006 as SJ2 Therapeutics, 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. | |
On March 27, 2013, the Company entered into a controlled equity offering sales agreement (the sales agreement) with Cantor Fitzgerald & Co. (Cantor), as sales agent, under which the Company issued and sold shares of its common stock from time to time through Cantor, having an aggregate offering price of up to $25.0 million. The sales of common stock made under the sales agreement were made in “at-the-market” offerings as defined in Rule 415 of the Securities Act of 1933, as amended. Under the sales agreement, the Company issued 6,753,104 shares of its common stock during 2013 at an average stock issuance price of $1.66 per share, resulting in net proceeds of approximately $10,834,000. The sales agreement with Cantor terminated on November 16, 2013. | |
On November 12, 2013, the Company completed a public offering (the November 2013 Offering) of common stock for net proceeds of approximately $64,471,000 (including over-allotment purchase), after deducting underwriting discounts and commissions of $4,140,000 and offering expenses of approximately $389,000. The Company sold a total of 30,666,667 shares of its common stock (including the underwriters' over-allotment purchase of 4,000,000 shares) at a purchase price of $2.25 per share. | |
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 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. |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
Accounting Policies [Abstract] | ' | |||||||||||||
Summary of Significant Accounting Policies | ' | |||||||||||||
Summary of Significant Accounting Policies | ||||||||||||||
Use of Estimates | ||||||||||||||
The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States (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 materially from those estimates. | ||||||||||||||
Principles of Consolidation | ||||||||||||||
The 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. | ||||||||||||||
Cash and Cash Equivalents | ||||||||||||||
The Company considers cash equivalents to be only those investments which are highly liquid, readily convertible to cash and have an original maturity of three months or less when purchased. | ||||||||||||||
Restricted Cash | ||||||||||||||
In December 2009, the Company issued a letter of credit for $200,000 in connection with another operating lease. The letter of credit is collateralized by a certificate of deposit in the same amount. Restricted cash of $200,000 at December 31, 2013 and 2012 is included in other assets on the consolidated balance sheet. | ||||||||||||||
Accounts Receivable | ||||||||||||||
Trade accounts receivable are recorded at the invoice amount net of allowances for cash discounts for prompt payment. The Company evaluates the collectability of its accounts receivable based on a variety of factors including the length of time the receivables are past due, the financial health of the customer and historical experience. Based upon the review of these factors, the Company recorded an allowance of $18,000 and $2,000 at December 31, 2013 and 2012, respectively. | ||||||||||||||
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 (excluding the tail payment due to Astellas Pharmaceutical US, Inc. (Astellas)) 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 accrued liability for the annual tail payment due to Astellas (see Note 3) for the termination of the Company’s co-promotion agreement was measured at fair value 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 liability 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 December 31, 2013 and December 31, 2012 are as follows (in thousands): | ||||||||||||||
Fair Value Measurements at Reporting Date Using | ||||||||||||||
Quoted Prices | Significant | Significant | Total | |||||||||||
in Active | Other | Unobservable | ||||||||||||
Markets for | Observable | Inputs | ||||||||||||
Identical Assets | Inputs | (Level 3) | ||||||||||||
(Level 1) | (Level 2) | |||||||||||||
At December 31, 2013 | ||||||||||||||
Assets | ||||||||||||||
Cash equivalents (1) | $ | 69,120 | — | — | $ | 69,120 | ||||||||
Liabilities | ||||||||||||||
Common stock warrant liabilities (2) | $ | — | — | 31,341 | $ | 31,341 | ||||||||
Embedded derivative liability (3) | $ | — | — | 233 | $ | 233 | ||||||||
At December 31, 2012 | ||||||||||||||
Assets | ||||||||||||||
Cash equivalents (1) | $ | 37,605 | — | — | $ | 37,605 | ||||||||
Liabilities | ||||||||||||||
Common stock warrant liability (2) | $ | — | — | 9,493 | $ | 9,493 | ||||||||
Embedded derivative liability (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 sheet. | |||||||||||||
-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 8) and warrants issued in connection with the Healthcare Royalty financing agreement (see Note 7), 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 and the timing of such event; and for the valuation scenario in which an extraordinary event occurs that is not an all cash transaction or an event whereby a public acquirer would assume the warrants, (b) an expected volatility rate using the Company's historical volatility, supplemented with historical volatility of comparable companies, through the projected date of public announcement of an extraordinary transaction, blended with a 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 derivatives are 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 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 of the liability. Management's revenue projections used in the December 31, 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 liability as of December 31, 2013. | |||||||||||||
The following table provides a reconciliation of liabilities measured at fair value using significant unobservable inputs (Level 3) for the years ended December 31, 2013 and 2012 (in thousands): | ||||||||||||||
Common Stock | Embedded | |||||||||||||
Warrant Liabilities | Derivative | |||||||||||||
Liabilities | ||||||||||||||
Balance at December 31, 2011 | $ | 345 | $ | 845 | ||||||||||
Issuance | 20,959 | — | ||||||||||||
Changes in fair value | (11,811 | ) | 147 | |||||||||||
Balance at December 31, 2012 | 9,493 | 992 | ||||||||||||
Exercises | (79 | ) | — | |||||||||||
Changes in fair value | 21,927 | (759 | ) | |||||||||||
Balance at December 31, 2013 | $ | 31,341 | $ | 233 | ||||||||||
Changes in fair value of the liabilities shown in the table above are recorded through a 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. | ||||||||||||||
Concentration of Credit Risk, Sources of Supply and Significant Customers | ||||||||||||||
Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and trade accounts receivable. The Company maintains accounts in federally insured financial institutions in excess of federally insured limits. The Company also maintains investments in money market funds and that are not federally insured. However, management believes the Company is not exposed to significant credit risk due to the financial position of the depository institutions in which these deposits are held and of the money market funds and other entities in which these investments are made. Additionally, the Company has established guidelines regarding the diversification of its investments and their maturities, which are designed to maintain safety and liquidity. | ||||||||||||||
The Company sells its products primarily to established wholesale distributors and retailers in the pharmaceutical industry. Three wholesale pharmaceutical distributors individually comprised 30.5%, 30.3% and 16.6% of the Company’s total gross sales of Sumavel DosePro for the year ended December 31, 2013. In addition, one retail company that purchases from the Company directly, individually comprised 14.6% of the Company's total gross sales of Sumavel DosePro for the year ended December 31, 2013. Approximately 84.9% and 10.3% of the trade accounts receivable balance as of December 31, 2013 represents amounts due from these three wholesale distributors and one retail customer, respectively. Credit is extended based on an evaluation of the customer’s financial condition, and collateral is not required. The Company evaluates the collectability of its accounts receivable based on a variety of factors including the length of time the receivables are past due, the financial health of the customer and historical experience. Based upon the review of these factors, the Company recorded an allowance of doubtful accounts of $18,000 and $2,000 at December 31, 2013 and December 31, 2012, respectively. | ||||||||||||||
The Company relies on third-party manufacturers for the production of Sumavel DosePro and single source third-party suppliers to manufacture several key components of Sumavel DosePro. The Company also relies on a third-party manufacturer and supplier of Zohydro ER. If the Company’s third-party manufacturers are unable to continue manufacturing Sumavel DosePro or Zohydro ER, or if the Company lost one or more of its single source suppliers used in the manufacturing process, the Company may not be able to meet market demand for its products. | ||||||||||||||
Inventory | ||||||||||||||
Inventory is stated at the lower of cost or market. Cost includes amounts related to materials, labor and overhead, and is determined in a manner which approximates the first-in, first-out (FIFO) method. The Company provides reserves for potentially excess, dated or obsolete inventories based on an analysis of inventory on hand and on firm purchase commitments compared to forecasts of future sales. | ||||||||||||||
Property and Equipment, Net | ||||||||||||||
Property and equipment is recorded at cost, net of accumulated depreciation and amortization. Depreciation is calculated on a straight-line basis over the estimated useful lives of the respective assets, as follows: | ||||||||||||||
Computer equipment and software | 3 years | |||||||||||||
Furniture and fixtures | 3-7 years | |||||||||||||
Manufacturing equipment and tooling | 3-15 years | |||||||||||||
Leasehold improvements | Shorter of estimated useful life or lease term | |||||||||||||
Impairment of Long-Lived Assets | ||||||||||||||
The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. There were immaterial charges as a result of impairment losses through December 31, 2013. | ||||||||||||||
Warrants for Common Stock | ||||||||||||||
In accordance with accounting guidance for warrants for shares in redeemable securities or warrants that could be settled for cash, the Company classifies warrants for common stock as current liabilities on the consolidated balance sheet. The Company adjusts the carrying value of these warrants for common stock that can be settled in cash to their estimated fair value at each reporting date with the increases or decreases in the fair value of such warrants recorded as change in fair value of warrant liabilities in the consolidated statement of operations and comprehensive loss. | ||||||||||||||
Embedded Derivatives | ||||||||||||||
The Company records embedded derivatives in the consolidated balance sheet at fair value. The carrying value of the embedded derivatives are adjusted to their estimated fair value at each reporting date with the increases or decreases in the fair value of such embedded derivatives recorded as change in fair value of embedded derivatives in the consolidated statement of operations and comprehensive loss. | ||||||||||||||
Revenue Recognition | ||||||||||||||
The Company recognizes revenue from the sale of Sumavel DosePro, and from license fees, milestones and service fees earned on collaborative arrangements. Revenue is recognized when (i) persuasive evidence of an arrangement exists, (ii) delivery has occurred and title has passed, (iii) the price is fixed or determinable and (iv) collectability is reasonably assured. Revenue from sales transactions where the buyer has the right to return the product is recognized at the time of sale only if (i) the Company’s price to the buyer is substantially fixed or determinable at the date of sale, (ii) the buyer has paid the Company, or the buyer is obligated to pay the Company and the obligation is not contingent on resale of the product, (iii) the buyer’s obligation to the Company would not be changed in the event of theft or physical destruction or damage of the product, (iv) the buyer acquiring the product for resale has economic substance apart from that provided by the Company, (v) the Company does not have significant obligations for future performance to directly bring about resale of the product by the buyer, and (vi) the amount of future returns can be reasonably estimated. | ||||||||||||||
Product Revenue, Net | ||||||||||||||
The Company sells Sumavel DosePro product in the United States to wholesale pharmaceutical distributors and retail pharmacies, or collectively the Company's customers, subject to rights of return. The Company recognizes product sales at the time title transfers to its customer, and reduces product sales for estimated future product returns and sales allowances in the same period the related revenue is recognized. Product sales allowances include wholesaler and retail pharmacy distribution fees, prompt pay discounts, chargebacks, rebates and patient discount programs, and are based on amounts owed or to be claimed on the related sales. These estimates take into consideration the terms of the Company's agreements with its customers and third-party payors and the levels of inventory within the distribution and retail channels that may result in future rebates or discounts taken. In certain cases, such as patient support programs, the Company recognizes the cost of patient discounts as a reduction of revenue based on estimated utilization. If actual future results vary, the Company may need to adjust these estimates, which could have an effect on product revenue in the period of adjustment. | ||||||||||||||
Prior to the third quarter of 2011, Sumavel DosePro had a limited sales history, and the Company could not reliably estimate expected returns of the product at the time of shipment. Accordingly, the Company deferred recognition of revenue on product shipments of Sumavel DosePro until the right of return no longer existed, which occurred at the earlier of the time Sumavel DosePro units were dispensed through patient prescriptions or expiration of the right of return. Units dispensed are generally not subject to return, except in the rare cases where the product malfunctions or the product is damaged in transit. The Company estimates patient prescriptions dispensed using an analysis of third-party information, including third-party market research data. | ||||||||||||||
Product Returns. The Company's estimated product return allowances for Sumavel DosePro require a high degree of judgment and are subject to change based on the Company's experience and certain quantitative and qualitative factors. Sumavel DosePro's shelf life is determined by the shorter expiry date of its two subassemblies, which is currently approximately 30 months from the date of manufacture. The Company's return policy allows for customers to return unused product that is within six months before and up to one year after its expiration date for a credit at the then-current wholesaler acquisition cost, or WAC, reduced by a nominal fee for processing the return. | ||||||||||||||
The Company has monitored and analyzed actual return history since product launch. The Company's analysis of actual product return history considers actual product returns on an individual product lot basis since product launch, the dating of the 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 to estimate its exposure for returned product. Because of the shelf life of Sumavel DosePro and the duration of time under which the Company's customers may return product through the Company's return policy, there may be a significant period of time between when the product is shipped and when the Company issues credits on returned product. Based on the Company's analysis of actual product return history, 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 and earnings for the year ended December 31, 2013 and increased net loss by $0.03 per share for the year ended December 31, 2013. Further, as a result of the Company’s third quarter 2013 product returns analysis, the Company began to utilize a higher product returns rate for Sumavel DosePro sales. | ||||||||||||||
The Company permits certain wholesale pharmaceutical distributors to purchase limited quantities of product after the announcement of an increase to the WAC of the Company’s product and prior to the effectiveness of the increase. In turn, WAC price increases can result in accelerated purchases by wholesalers relative to anticipated retail and prescription demand. The timing of purchases made by wholesale distributors and retail pharmacies are subject to fluctuations for these reasons among others. | ||||||||||||||
Wholesaler and Retail Pharmacy Distribution Fees. The Company offers distribution fees to certain wholesale distributors and retail pharmacies based on contractually determined rates. The Company accrues the distribution fees on shipment to the respective wholesale distributors and retail pharmacies and recognizes the distribution fees as a reduction of revenue in the same period the related revenue is recognized. | ||||||||||||||
Prompt Pay Discounts. The Company offers cash discounts to its customers, generally 2% of the sales price, as an incentive for prompt payment. The Company accounts for cash discounts by reducing accounts receivable by the prompt pay discount amount and recognizes the discount as a reduction of revenue in the same period the related revenue is recognized. | ||||||||||||||
Chargebacks. The Company provides discounts primarily to authorized users of the Federal Supply Schedule (FSS) of the General Services Administration under an FSS contract negotiated by the Department of Veterans Affairs and various organizations under Medicaid contracts and regulations. These entities purchase products from the wholesale distributors at a discounted price, and the wholesale distributors then charge back to the Company the difference between the current retail price and the price the federal entity paid for the product. The Company estimates and accrues chargebacks based on estimated wholesaler inventory levels, current contract prices and historical chargeback activity. Chargebacks are recognized as a reduction of revenue in the period the related revenue is recognized. | ||||||||||||||
Rebates. The Company participates in certain rebate programs, which provide discounted prescriptions to qualified insured patients. Under these rebate programs, the Company pays a rebate to the third-party administrator of the program, generally two to three months after the quarter in which prescriptions subject to the rebate are filled. The Company estimates and accrues these rebates based on current contract prices, historical and estimated future percentages of product sold to qualified patients and estimated levels of inventory in the distribution channel. Rebates are recognized as a reduction of revenue in the period the related revenue is recognized. | ||||||||||||||
Patient Discount Programs. The Company offers discount card programs to patients for Sumavel DosePro in which patients receive discounts on their prescriptions that are reimbursed by the Company. The Company estimates the total amount that will be redeemed based on levels of inventory in the distribution and retail channels and recognizes the discount as a reduction of revenue in the same period the related revenue is recognized. | ||||||||||||||
Contract Revenue | ||||||||||||||
Contract revenue consists of the amortization of license fees and milestone payments received under co-promotion agreements, which have multiple deliverables. Revenue arrangements with multiple deliverables are divided into separate units of accounting if criteria are met, including whether the deliverable has stand-alone value to the customer and the customer has a general right of return relative to the delivered item and delivery or performance of the undelivered item is probable and substantially within the vendor's control. Arrangement consideration is allocated at the inception of the arrangement to all deliverables on the basis of their relative selling price. The selling price for each deliverable is determined using: (i) vendor-specific objective evidence of selling price (VSOE), if it exists, (ii) third-party evidence of selling price (TPE) if VSOE does not exist, and (iii) the Company's best estimate of the selling price if neither VSOE nor TPE exists. For transactions entered into prior to January 1, 2011, revenue was recognized for each deliverable based upon the applicable revenue recognition criteria discussed above and upon acceptance of goods or performance of service. Effective January 1, 2011, for new or significantly modified transactions, the Company allocates revenue consideration, excluding contingent consideration, based on the relative selling prices of the separate units of accounting contained within an arrangement containing multiple deliverables. | ||||||||||||||
Service and Other Revenue | ||||||||||||||
Service and other revenue primarily consists of payments received for the Company's sales efforts under the co-promotion agreement with Valeant Pharmaceuticals North America LLC (Valeant). The Company recognizes service and other revenue at the time services have been rendered. | ||||||||||||||
Collaborative Arrangements | ||||||||||||||
The Company records certain transactions between collaborators in the consolidated statement of operations and comprehensive loss on either a gross or net basis within revenues or operating expenses, depending on the characteristics of the collaboration relationship, and provides for enhanced disclosure of collaborative relationships. The Company evaluates its collaborative agreements for proper classification of shared expenses, license fees, milestone payments and any reimbursed costs within the consolidated statement of operations and comprehensive loss based on the nature of the underlying activity. If payments to and from collaborative partners are not within the scope of other authoritative accounting literature, the statement of operations and comprehensive loss classification for the payments is based on a reasonable, rational analogy to authoritative accounting literature that is applied in a consistent manner. For collaborations relating to commercialized products, if the Company acts as the principal in the sale of goods or services, the Company records revenue and the corresponding operating costs in its respective line items within the consolidated statement of operations and comprehensive loss based on the nature of the shared expenses. Per authoritative accounting guidance, the principal is the party who is responsible for delivering the product to the customer, has latitude with establishing price and has the risks and rewards of providing product to the customer, including inventory and credit risk. | ||||||||||||||
Research and Development Expenses | ||||||||||||||
All costs of research and development are expensed in the period incurred. Research and development costs primarily consist of salaries and related expenses for personnel, stock-based compensation expense, outside service providers, facilities costs, fees paid to consultants, milestone payments prior to FDA approval, license fees prior to FDA approval, professional services, travel costs, dues and subscriptions, depreciation and materials used in clinical trials and research and development. The Company expenses costs relating to the purchase and production of pre-approval inventories as research and development expense in the period incurred until FDA approval is received. | ||||||||||||||
The Company reviews and accrues expenses related to clinical trials based on work performed, which relies on estimates of total costs incurred based on completion of patient studies and other events. The Company follows this method since reasonably dependable estimates of the costs applicable to various stages of a research agreement or clinical trial can be made. Accrued clinical development costs are subject to revisions as trials progress to completion. Revisions are charged to expense in the period in which the facts that give rise to the revision become known. | ||||||||||||||
Advertising Expense | ||||||||||||||
The Company records the cost of its advertising efforts when services are performed or goods are delivered. The Company incurred approximately $597,000, $522,000 and $1,180,000 in advertising costs for the years ended December 31, 2013, 2012 and 2011, respectively. At December 31, 2013 and 2012, the Company capitalized advertising costs of $2,000 and $159,000 in prepaid expenses and other current assets, respectively. | ||||||||||||||
Income Taxes | ||||||||||||||
Deferred tax assets and liabilities are determined based on the differences between the financial reporting and tax basis of assets and liabilities using enacted tax rates which will be in effect when the differences reverse. The Company provides a valuation allowance against net deferred tax assets unless, based upon the available evidence, it is more likely than not that the deferred tax asset will be realized. The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. | ||||||||||||||
Foreign Currency Transactions | ||||||||||||||
Gains or losses resulting from transactions denominated in foreign currencies are included in other expense in the consolidated statements of operations and comprehensive loss. The Company recorded losses from foreign currency transactions in other income (expense) of $(95,000), $(68,000) and $86,000 for the years ended December 31, 2013, 2012 and 2011, respectively. | ||||||||||||||
Stock-Based Compensation | ||||||||||||||
Stock-based compensation cost is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense over the employee’s requisite service period on a straight-line basis. As of December 31, 2013, there were no outstanding equity awards with market or performance conditions. Equity awards issued to non-employees are recorded at their fair value on the measurement date and are re-measured at each reporting date as the underlying awards vest unless the instruments are fully vested, immediately exercisable and nonforfeitable on the date of grant. | ||||||||||||||
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, restricted stock units, warrants and common stock subject to repurchase 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): | ||||||||||||||
Year Ended December 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Numerator | ||||||||||||||
Net loss | $ | (80,856 | ) | $ | (47,386 | ) | $ | (83,903 | ) | |||||
Denominator | ||||||||||||||
Weighted average common shares outstanding | 108,568 | 80,558 | 42,715 | |||||||||||
Weighted average shares subject to repurchase | — | — | (3 | ) | ||||||||||
Weighted average shares outstanding, basic and diluted | 108,568 | 80,558 | 42,712 | |||||||||||
Basic and diluted net loss per share | $ | (0.74 | ) | $ | (0.59 | ) | $ | (1.96 | ) | |||||
Potentially dilutive securities not included in the calculation of diluted net loss per share because to do so would be anti-dilutive are as follows (in thousands, of common equivalent shares): | ||||||||||||||
Year Ended December 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Common stock options and restricted stock units | 11,027 | 47 | 184 | |||||||||||
Common stock warrants | 15,681 | — | — | |||||||||||
26,708 | 47 | 184 | ||||||||||||
Segment Reporting | ||||||||||||||
Management has determined that the Company operates in one business segment, which is the development and commercialization of pharmaceutical products for people living with pain-related conditions and central nervous system disorders. | ||||||||||||||
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. |
Collaboration_License_and_Purc
Collaboration, License and Purchase Agreements | 12 Months Ended |
Dec. 31, 2013 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
Collaboration, License and Purchase Agreements | ' |
Collaboration, License and Purchase 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 in the United States. Mallinckrodt's sales team began selling Sumavel DosePro to its customer base of prescribers in August 2012. Mallinckrodt committed to a minimum number of sales representatives for the initial term of the agreement, which ran through June 30, 2014. | |
In partial consideration of Mallinckrodt's sales efforts, the Company paid Mallinckrodt a service fee on a quarterly basis through January 31, 2014 that represented 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. For the years ended December 31, 2013 and 2012, the Company incurred $1,035,000 and $161,000 in service fee expenses under the Co-Promotion Agreement. | |
In January 2014, the Company entered into an amendment to the Co-Promotion Agreement (Amended Co-Promotion Agreement), whereby the Co-Promotion Agreement terminated on January 31, 2014. The Company assumed full responsibility for the commercialization of Sumavel DosePro in February 2014. In connection with the termination of the Co-Promotion Agreement, the Company is required to make a one-time tail payment to Mallinckrodt, calculated as a fixed percentage of net sales from the Mallinckrodt targeted prescriber audience during the 12 month period ending on January 31, 2015. A liability for this tail-payment will be recorded in the first quarter of 2014, once its reasonably estimable. | |
Altus Formulation Inc. Development and Option Agreement | |
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 is 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, and the Company is responsible for the conduct of the clinical development of the product. The Company paid a non-refundable upfront fee to Altus of $750,000 which was recorded as research and development expense during the twelve months ended December 31, 2013. 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 and offer for sale 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 an 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. | |
Valeant Pharmaceuticals North America LLC Co-Promotion Agreement | |
On June 27, 2013, the Company entered into a co-promotion agreement with Valeant (the Valeant Agreement). 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. 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 the year ended December 31, 2013, the Company recognized service revenue of $1,109,000 under the Valeant Agreement. | |
Alkermes Commercial Manufacturing and Supply Agreement | |
On November 2, 2012, the Company entered into a commercial manufacturing and supply agreement for Zohydro ER finished commercial product (the Supply Agreement) with Alkermes Pharma Ireland Limited (APIL). Under the Supply Agreement, APIL is the exclusive manufacturer and supplier to the Company (subject to certain exceptions) of Zohydro ER. The Company must purchase all of its requirements of Zohydro ER, subject to certain exceptions, from APIL. | |
Under the Supply Agreement, the Company will provide APIL with an eighteen-month forecast on a monthly basis and with a three-year forecast on an annual basis for commercial supply requirements of Zohydro ER. In each of the four months following the submission of the eighteen-month forecast, the Company is obligated to order the quantity of Zohydro ER specified in the forecast. APIL will use commercially reasonable efforts to supply the orders of Zohydro ER subject to the availability of the United States Drug Enforcement Administration quota for hydrocodone. APIL is not obligated to supply the Company with quantities of Zohydro ER in excess of forecasted amounts, but has agreed to use commercially reasonable efforts to do so. Further, the Company is obligated to purchase at least 75% of forecasted quarterly quantities of Zohydro ER from APIL, and is required to make compensatory payments if it does not purchase 100% of its requirements from APIL, subject to certain exceptions. | |
If a failure to supply occurs under the Supply Agreement, other than a force majeure event, APIL must use commercially reasonable efforts to assist the Company in transferring production of Zohydro ER to either the Company or a third-party manufacturer, provided that such third party is not a technological competitor of APIL. In a failure to supply circumstance, the Company would be able to utilize (or sublicense to a third party who is not a technological competitor of APIL) the manufacturing license rights granted to it under the license agreement with Alkermes, an affiliate of APIL, until such time as APIL can resume supply of Zohydro ER. | |
Either party may terminate the Supply Agreement by written notice if the other party commits a material breach of its obligations which is either incapable of remedy or is not remedied within a specified period following receipt of written notice of such breach. Unless otherwise terminated due to a material breach, the Supply Agreement will continue until the expiry or termination of the license agreement with Alkermes. | |
Astellas Pharma US, Inc. Co-Promotion Agreement | |
In July 2009, the Company entered into the Co-Promotion Agreement with Astellas (the 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 (excluding Puerto Rico and the other territories and possessions of 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 represented 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 (the 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, all deferred contract revenues were recognized through March 31, 2012. For the years ended December 31, 2013, 2012 and 2011 the Company recognized $0, $8,462,000 and $7,165,000, respectively, of contract revenue. | |
In addition, following completion of the co-promotion term in March 2012, the Company was required to pay Astellas one tail payment in July 2013 and is required to pay Astellas another tail payment in July 2014, calculated as decreasing fixed percentages (ranging from mid-twenties down to a mid-teen percentage) of net sales in the Astellas Segment during the 12 months ended March 31, 2012. 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 will be 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 December 31, 2013 and 2012, the tail payment liability, after considering the August 2012 service fee reduction discussed below, was $1,131,000 and $2,795,000, respectively. The Company recognized $368,000 and $550,000 of related interest expense during the years ended December 31, 2013 and 2012, and did not recognize any related interest expense during the year ended December 31, 2011. | |
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 year ended December 31, 2012, and an offset to the tail payment liability. The fair value of the service fee receivable and tail payment reduction will be accreted through interest income through the dates of the two tail payments in July 2013 and July 2014. | |
For the years ended December 31, 2013, 2012 and 2011, the Company recognized shared marketing expense of $0, $253,000 and $1,663,000, respectively, under the Astellas Co-Promotion Agreement. For the years ended December 31, 2013, 2012 and 2011, the Company incurred $0, $1,756,000 (excluding the $1,924,000 service fee adjustment discussed above) and $6,657,000 (excluding the $2,795,000 expense recognized when the tail payments were initially recorded) in service fee expenses, respectively. | |
Durect Development and License Agreement | |
On July 11, 2011, the Company entered into a development and license agreement with Durect Corporation (the License Agreement). Under the License Agreement, the Company is responsible for the clinical development and commercialization of Relday, a proprietary, long-acting injectable formulation of risperidone using Durect’s SABER™ controlled-release formulation technology in combination with the Company’s DosePro® needle-free, subcutaneous drug delivery system. Durect is responsible for non-clinical, formulation and chemistry, manufacturing and controls development. Durect will be reimbursed by the Company for its research and development efforts on the product. | |
The Company paid a non-refundable upfront fee to Durect of $2,250,000, which was recorded as research and development expenses in the consolidated statement of operations and comprehensive loss during the year ended December 31, 2011. The Company is obligated to pay Durect up to $103,000,000 in total future milestone payments with respect to the product subject to and upon the achievement of various development, regulatory and sales milestones. The Company is also required to pay a mid single-digit to low double-digit percentage patent royalty on annual net sales of the product determined on a jurisdiction-by-jurisdiction basis. Further, until a New Drug Application (NDA) for Relday has been filed in the United States, the Company is obligated to spend no less than $1,000,000 in external expenses on the development of Relday in any trailing twelve months period beginning in July 2012. The patent royalty term is equal to the later of the expiration of all Durect technology patents or joint patent rights in a particular jurisdiction, the expiration of marketing exclusivity rights in such jurisdiction, or 15 years from first commercial sale in such jurisdiction. After the patent royalty term, the Company will continue to pay royalties on annual net sales of the product at a reduced rate for so long as the Company continues to sell the product in the jurisdiction. The Company is also required to pay to Durect a tiered percentage of fees received in connection with any sublicense of the licensed rights. | |
Durect granted the Company an exclusive worldwide license, with sub-license rights, to Durect intellectual property rights related to Durect’s proprietary polymeric and non-polymeric controlled-release formulation technology to make and have made, use, offer for sale, sell and import risperidone products, where risperidone is the sole active agent, for administration by injection in the treatment of schizophrenia, bipolar disorder or other psychiatric related disorders in humans. Durect retains the right to supply the Company’s Phase 3 clinical trial and commercial product requirements on the terms set forth in the License Agreement. | |
Durect retains the right to terminate the License Agreement with respect to specific countries if the Company fails to advance the development of the product in such country within a specified period, either directly or through a sublicensee. In addition, either party may terminate the License Agreement upon insolvency or bankruptcy of the other party, upon written notice of a material uncured breach or if the other party takes any act impairing such other party’s relevant intellectual property rights. The Company may terminate the License Agreement upon written notice if during the development or commercialization of the product, the product becomes subject to one or more serious adverse drug experiences or if either party receives notice from a regulatory authority, independent review committee, data safety monitoring board or other similar body alleging significant concern regarding a patient safety issue and, as a result, the Company believes the long-term viability of the product would be seriously impacted. The Company may also terminate the License Agreement with or without cause, at any time upon prior written notice. | |
Desitin Arzneimittel GmbH Licensing and Distribution Agreement | |
In 2008, the Company entered into a licensing and distribution agreement (the Distribution Agreement) with Desitin Arzneimittel GmbH (Desitin), a private German pharmaceutical company focused on the development, manufacturing and distribution of products for the treatment of central nervous system disorders. Under the terms of the Distribution Agreement, the Company licensed to Desitin the exclusive development and commercialization rights to Sumavel DosePro for the European Union, Norway, Switzerland and Turkey. On August 5, 2013, the Company agreed with Desitin to terminate the Distribution Agreement effective October 1, 2013. | |
Under the Distribution Agreement, Desitin oversaw, and was responsible for the expenses related to, all clinical development, regulatory approval and commercialization efforts required to market Sumavel DosePro in the territories in which Desitin elected to develop and market Sumavel DosePro. The Company manufactured and supplied the product to Desitin for commercial sale. Desitin paid the Company a specified transfer price for commercial product and a low single-digit percentage royalty on net sales of the product. In November 2010, Desitin received regulatory approval for the commercialization of Sumavel DosePro in Denmark. It received subsequent approvals in Germany, Sweden, the United Kingdom, Norway and France; however, the marketing authorizations for Sweden, Norway, France and the United Kingdom were withdrawn as of December 31, 2013. The Company did not recognize any revenue for sales to Desitin for the years ended December 31, 2013 and 2011, and recognized $397,000 in revenue for sales to Desitin for the year ended December 31, 2012. Under the terms of the Distribution Agreement, Desitin does not have the right to return product that it has purchased. | |
Alkermes License Agreement (formerly Elan Pharma International Limited) | |
In 2007, the Company entered into a License Agreement with Alkermes, which was amended in 2009. Under the terms of this License Agreement, Alkermes granted the Company an exclusive license in the United States and its possessions and territories, with defined sub-license rights to third parties other than certain technological competitors of Alkermes, to certain Alkermes intellectual property rights related to the Company’s Zohydro ER product candidate. The License Agreement grants the Company the exclusive right under certain Alkermes patents and patent applications to import, use, offer for sale and sell oral controlled-release capsule or tablet formulations of hydrocodone, where hydrocodone is the sole active ingredient, for oral prescriptions in the treatment or relief of pain, pain syndromes or pain associated with medical conditions or procedures in the United States. This right enables the Company to exclusively develop and sell Zohydro ER in the United States. Alkermes has retained the exclusive right to take action in the event of infringement or threatened infringement by a third party of Alkermes’ intellectual property rights under the License Agreement. The Company has the right to pursue an infringement claim against the alleged infringer should Alkermes decline to take or continue an action. | |
Under the terms of the License Agreement, the Company and Alkermes agreed that, subject to the negotiation of the Supply Agreement, Alkermes, or an affiliate of Alkermes, would have the sole and exclusive right to manufacture and supply finished commercial product of Zohydro ER to the Company under agreed upon financial terms. The Company entered into the Supply Agreement with APIL in November 2012. | |
Alkermes also granted to the Company, in the event that Alkermes is unwilling or unable to manufacture or supply commercial product to the Company, a non-exclusive license to make product under Alkermes’ intellectual property rights. This non-exclusive license also includes the right to sublicense product manufacturing to a third party, other than certain technological competitors of Alkermes. | |
Under the License Agreement, the Company paid an upfront fee of $500,000 to Alkermes, which was recorded as research and development expense. The Company paid additional milestone payments in the amount of $750,000 to Alkermes in August 2011 in connection with the completion of the treatment phase of the Company’s pivotal efficacy Phase 3 clinical trial, Study 801, and $1,000,000 upon submission of the first Zohydro ER NDA to the FDA in May 2012, which were recorded as research and development expense. Lastly, the Company paid a milestone payment of $2,750,000 upon the first NDA approval of Zohydro ER in October 2013, which was recorded as other assets in the consolidated balance sheet and will be amortized over the estimated life of the technology, through November 2019. | |
In addition, the Company will be required to pay a mid single-digit percentage royalty on net sales of the product for an initial royalty term equal to the longer of the expiration of Alkermes’ patents covering the product in the United States, or 15 years after commercial launch, if Alkermes does not have patents covering the product in the United States. After the initial royalty term, the License Agreement will continue automatically for three-year rolling periods during which the Company will continue to pay royalties to Alkermes on net sales of the product at a reduced low single-digit percentage rate in accordance with the terms of the License Agreement. | |
Either party may terminate the License Agreement upon a material, uncured default or certain insolvency events of the other party or upon 12 months written notice prior to the end of the initial royalty term or any additional three-year rolling period. The Company may also terminate the License Agreement, with or without cause, at any point in time upon 12 months' prior written notice, or if the sale of Zohydro ER is prohibited by regulatory authorities. | |
Aradigm Corporation Asset Purchase Agreement | |
In 2006, the Company entered into an asset purchase agreement with Aradigm Corporation (Aradigm). Under the terms of the agreement, Aradigm assigned and transferred to the Company all of its right, title and interest to tangible assets and intellectual property related to the DosePro needle-free drug delivery system. Aradigm also granted to the Company a non-exclusive, fully paid, worldwide, perpetual, irrevocable, transferable, sublicensable license under all other intellectual property of Aradigm that was owned, controlled or employed by Aradigm prior to the closing of the asset purchase and that is necessary or useful to the development, manufacture or commercialization of the DosePro delivery system. Aradigm also retained a worldwide, royalty-free, non-exclusive license, with a right to sublicense, under all transferred intellectual property rights solely for purposes of the pulmonary field, and the Company granted Aradigm a license under other intellectual property rights solely for use in the pulmonary field. | |
The Company paid Aradigm $4,000,000 at the closing of the asset purchase and was required to make an additional $4,000,000 milestone payment to Aradigm upon the U.S. commercialization of Sumavel DosePro (which payment was made in 2010). The Company is also required to pay a 3% royalty on global net sales of Sumavel DosePro, by the Company or one of the Company’s future licensees, if any, until the later of January 2020 or the expiration of the last valid claim of the transferred patents covering the manufacture, use, or sale of the product. The Company recorded the second milestone payment as other assets in the consolidated balance sheet and is amortizing the milestone over the estimated life of the technology, through December 2023. For the years ended December 31, 2013, 2012 and 2011, the Company recorded $1,242,000, $1,353,000 and $1,205,000, respectively, of expense related to the amortization of the milestone and royalties from net sales of Sumavel DosePro. The Company expects to record annual amortization expense of approximately $286,000 during the years ended December 2014 through 2018, and $2,571,000 in amortization expense thereafter related to the amortization of the milestone. | |
In addition, in the event the Company or one of its future licensees, if any, commercializes a non-sumatriptan product in the DosePro delivery system, the Company will be required to pay Aradigm, at the Company’s election, either a 3% royalty on net sales of each non-sumatriptan product commercialized, or a fixed low-twenties percentage of the royalty revenues received by the Company from the licensee, if any, until the later of the ten year anniversary of the first commercial sale of the product in the United States or the expiration of the last valid claim of the transferred patents covering the manufacture, use or sale of the product. Royalty revenues under this agreement include, if applicable, running royalties on the net sales of non-sumatriptan products, license or milestone fees not allocable to development or other related costs incurred by the Company, payments in consideration of goods or products in excess of their cost, or payments in consideration for equity in excess of the then fair market value of the equity. |
Consolidated_Balance_Sheet_Det
Consolidated Balance Sheet Details | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Balance Sheet Related Disclosures [Abstract] | ' | |||||||
Consolidated Balance Sheet Details | ' | |||||||
Consolidated Balance Sheet Details | ||||||||
Inventory (in thousands) | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Raw materials | $ | 2,770 | $ | 4,867 | ||||
Work in process | 6,054 | 6,134 | ||||||
Finished goods | 1,112 | 1,885 | ||||||
$ | 9,936 | $ | 12,886 | |||||
Property and Equipment, Net (in thousands) | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Machinery, equipment and tooling | $ | 12,479 | $ | 12,325 | ||||
Construction in progress | 6,222 | 5,068 | ||||||
Computer equipment and software | 951 | 961 | ||||||
Leasehold improvements | 783 | 783 | ||||||
Furniture and fixtures | 628 | 685 | ||||||
Property and equipment, at cost | 21,063 | 19,822 | ||||||
Less accumulated depreciation | (8,052 | ) | (6,261 | ) | ||||
$ | 13,011 | $ | 13,561 | |||||
Depreciation expense for the years ended December 31, 2013, 2012 and 2011 was $1,806,000, $1,599,000 and $1,584,000, respectively. | ||||||||
Other Assets (in thousands) | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Prepaid Aradigm royalty expense | $ | 2,571 | $ | 3,143 | ||||
Prepaid Alkermes royalty expense | 2,318 | — | ||||||
Debt acquisition costs | 969 | 1,217 | ||||||
Deposits | 431 | 840 | ||||||
Restricted cash | 200 | 200 | ||||||
Other assets | 125 | — | ||||||
$ | 6,614 | $ | 5,400 | |||||
Accrued Expenses (in thousands) | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Accrued product returns | $ | 5,445 | $ | 3,034 | ||||
Accrued discounts and allowances | 4,239 | 4,088 | ||||||
Accrued interest expense, current portion | 3,033 | 2,526 | ||||||
Accrued clinical trial costs | 1,238 | 1,012 | ||||||
Accrued sales and marketing costs | 1,161 | 304 | ||||||
Astellas tail payment, current portion | 1,131 | 1,820 | ||||||
Other accrued expenses | 2,618 | 1,559 | ||||||
$ | 18,865 | $ | 14,343 | |||||
Other Long-Term Liabilities (in thousands) | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Interest expense payable, less current portion | $ | 5,901 | $ | 2,607 | ||||
Deferred rent | 77 | 214 | ||||||
Embedded derivatives | 233 | 992 | ||||||
Astellas tail payment, less current portion | — | 975 | ||||||
Other long-term liabilities | 285 | 290 | ||||||
$ | 6,496 | $ | 5,078 | |||||
Restructuring
Restructuring | 12 Months Ended | |||||||||||
Dec. 31, 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 year ended December 31, 2013, the Company recorded restructuring charges of $876,000 consisting primarily of employee-related compensation charges. The following table summarizes the components of the restructuring charges for the year ended December 31, 2013 (in thousands): | ||||||||||||
Twelve Months Ended December 31, 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 twelve months ended December 31, 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 | (659 | ) | (12 | ) | (671 | ) | ||||||
Balance at December 31, 2013 | $ | 4 | $ | — | $ | 4 | ||||||
The balance of the restructuring liability at December 31, 2013 is anticipated to be fully distributed by June 2014. |
Commitments
Commitments | 12 Months Ended | |||
Dec. 31, 2013 | ||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||
Commitments | ' | |||
Commitments | ||||
Operating Leases | ||||
The Company had an operating lease for office facilities in San Diego, California, which commenced in September 2008 and expired in April 2012. In April 2012, prior to the expiration of this lease, the Company entered into a new operating lease for office facilities located in San Diego, California, which commenced on April 23, 2012 and will expire on November 27, 2014. The Company received free rent for the second, third and fourth months of the lease term. The base rent will increase approximately 3% on an annual basis throughout the term. The lease also requires the Company to pay, following the first 12 lease months, additional rent consisting of a portion of common area and pass-through expenses in excess of base year amounts. This space is used for general and administrative and sales and marketing operations and personnel. | ||||
The Company also leases office space for its supply chain and inventory management and research and product development operations in Emeryville, California under a non-cancelable operating lease that expires, as extended, in September 2015. The base rent is subject to a 3% increase each year for the duration of the lease. Under the terms of the lease, as amended, the Company received an option to expand into additional space. The Company also received free rent for two months and a tenant improvement allowance of $305,000. | ||||
In August 2009, the Company entered an operating lease agreement to lease vehicles for the Company's field sales force. Each vehicle has a lease term of 36 months with a fixed monthly rental payment. As security for the vehicle leases, the lessor required a letter of credit for $200,000, which is collateralized by a certificate of deposit in the same amount. | ||||
The Company recognizes rent expense on a straight-line basis over the non-cancelable term of its operating leases. Rent expense for the years ended December 31, 2013, 2012 and 2011 was $829,000, $828,000 and $826,000, respectively. | ||||
Future minimum lease payments as of December 31, 2013 are as follows (in thousands): | ||||
2014 | $ | 1,330 | ||
2015 | 693 | |||
2016 | 43 | |||
2017 and thereafter | — | |||
Total | $ | 2,066 | ||
Manufacturing and Supply Agreements | ||||
The Company has a manufacturing services agreement with Patheon UK Limited (Patheon) for the aseptic capsule assembly, filling and inspection, final system assembly and purchasing of Sumavel DosePro, as well as other manufacturing and support services. In August 2013, the Company entered into an amended manufacturing services agreement (the Amended Services Agreement), with Patheon which replaced the Company's original manufacturing services agreement upon its expiration on October 31, 2013. The Amended Services Agreement has similar terms to the original agreement and will expire on April 30, 2016. The parties may mutually agree in writing to renew the term for additional terms prior to the expiration of the then-current term. | ||||
The Company has manufacturing and supply agreements with several third-party suppliers for the production of key components of Sumavel DosePro, which expire on various dates between 2012 and 2020. As of December 31, 2013, the Company has non-cancellable purchase orders for 2014 totaling approximately $5,218,000 (based on the exchange rate as of December 31, 2013) under these arrangements. In addition, the Company is required to pay Patheon a monthly manufacturing fee of £311,000, or approximately $513,000 (based on the exchange rate as of December 31, 2013), through October 2013, and a monthly manufacturing fee of £409,000, or approximately $674,000 (based on the exchange rate as of December 31, 2013), from November 1, 2013 through the term of the Amended Services Agreement. As of December 31, 2013, the Company was committed to pay Patheon a total manufacturing fee of £11,452,000, or approximately $18,882,000 (based on the exchange rate as of December 31, 2013), which is payable monthly over the remaining term of the Amended Services Agreement. | ||||
The Company also has a Supply Agreement for Zohydro ER finished commercial product with APIL (see Note 3). Under the Supply Agreement, APIL is the exclusive manufacturer and supplier to the Company (subject to certain exceptions) of Zohydro ER. The Company must purchase all of its requirements of Zohydro ER, subject to certain exceptions, from APIL. As of December 31, 2013, the Company has non-cancellable purchase orders for 2014 totaling approximately $3,246,000 under the Supply Agreement. |
Debt
Debt | 12 Months Ended | |||
Dec. 31, 2013 | ||||
Debt Disclosure [Abstract] | ' | |||
Debt | ' | |||
Debt | ||||
Maturities of long-term debt as of December 31, 2013, are as follows (in thousands): | ||||
2014 | 3,033 | |||
2015 | 15,930 | |||
2016 | 17,259 | |||
2017 | 16,668 | |||
2018 | 4,159 | |||
Total minimum payments | 57,049 | |||
Less amount representing interest | (27,049 | ) | ||
Total long-term debt | 30,000 | |||
Less current portion | — | |||
Long-term portion | $ | 30,000 | ||
Interest expense related to long-term debt for the years ended December 31, 2013, 2012 and 2011 was $5,672,000, $6,708,000 and $5,562,000, respectively. | ||||
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 Astellas Co-Promotion Agreement 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 with Oxford Finance LLC (Oxford) and Silicon Valley Bank (SVB). 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 $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 includes 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 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 December 31, 2013 and 2012 was $233,000 and $992,000, respectively, and is included in other long-term liabilities. As the Company agreed to early terminate the Astellas Co-Promotion Agreement in December 2011, the related embedded derivative was derecognized, resulting in a $417,000 adjustment to the fair value of embedded derivatives for the year ended December 31, 2011. | ||||
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 $(307,000) and $160,000 for the years ended December 31, 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 embedded derivatives of $759,000 and $(147,000) for the years ended December 31, 2013 and 2012, respectively, in the statements 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 the equipment financing described below. In July and October 2010, the Company amended and restated the Oxford Agreement, and Oxford and SVB became party to the amended agreement. In June 2011, the Company entered into an amendment to the second amended and restated Oxford 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. In connection with entering into the Amended Oxford/SVB Agreement, the Company issued to Oxford and SVB warrants exercisable into an aggregate of 26,455 shares of the Company’s 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. | ||||
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 Amended Oxford/SVB 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. The outstanding principal balance of the term loan and the revolving credit facility as of December 31, 2011 was $25,000,000 and $5,151,000, respectively. | ||||
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. | ||||
Equipment Financing | ||||
In March 2007, the Company entered into a $10,000,000 master loan and security agreement (GE Agreement) with GE Capital Corporation (GE Capital) for the purpose of financing capital equipment purchases. Each borrowing was under a promissory note repayable in 48 monthly installments based upon a monthly repayment schedule bearing interest at an annual rate determined on the date of borrowing. The first promissory note was executed in March 2007 for $3,500,000 with an interest rate of 10.08%. A second promissory note was executed in December 2007 for $1,000,000 with an interest rate of 9.91%. The Company’s ability to make further borrowing under the GE Agreement expired on December 21, 2007. | ||||
The Company had the option to prepay the outstanding balance of the promissory notes in full, subject to a prepayment fee as defined in the GE Agreement. The outstanding principal balance of the GE Agreement was repaid in full on June 30, 2011. |
Preferred_Stock_and_Stockholde
Preferred Stock and Stockholders' Equity | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
Stockholders' Equity Note [Abstract] | ' | |||||
Preferred Stock and Stockholders' Equity | ' | |||||
Preferred Stock and Stockholders’ Equity | ||||||
Preferred Stock | ||||||
Under the Company’s amended and restated certificate of incorporation, as of December 31, 2013 and 2012, the Company is authorized to issue 10,000,000 shares of preferred stock with a $0.001 par value. As of December 31, 2013 and 2012, there were no shares of preferred stock issued or outstanding. | ||||||
Common Stock | ||||||
Under the Company’s amended and restated certificate of incorporation, as of December 31, 2013 and 2012, the Company was authorized to issue 200,000,000 shares of common stock with a $0.001 par value. Each share of common stock is entitled to one vote. The holders of common stock are also entitled to receive dividends whenever funds are legally available, when declared by the board of directors, subject to the prior rights of holders of convertible preferred stock. | ||||||
Common stock reserved for future issuance is as follows (in thousands): | ||||||
December 31, | ||||||
2013 | 2012 | |||||
Stock options and restricted stock units outstanding | 14,859 | 9,901 | ||||
Warrants to purchase common stock | 16,189 | 16,292 | ||||
Shares authorized for future issuance under equity and purchase plans | 2,595 | 1,166 | ||||
33,643 | 27,359 | |||||
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 five 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 date (see Note 2). During the year ended December 31, 2013, warrants to purchase 103,500 shares of common stock were exercised. The fair value of the warrants outstanding was approximately $30,849,000 and $9,308,000 as of December 31, 2013 and 2012, respectively. | ||||||
In July 2011, upon the closing of and in connection with the Financing Agreement (see Note 7), 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 $492,000 and $185,000 as of December 31, 2013 and 2012, respectively. | ||||||
In June 2011, and in connection with entering into the Amended Oxford/SVB Agreement (see Note 7), 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. | ||||||
Convertible Preferred Stock Warrants | ||||||
In connection with the execution of the amended Oxford Agreement in July 2010, the Company issued warrants to Oxford and SVB to purchase 1,145,455 and 445,455 shares, respectively, of Series B convertible preferred stock at an exercise price of $1.10 per share. The warrants expire in November 2015. In connection with the Company’s initial public offering (IPO) in November 2010, these warrants were converted to 159,090 warrants for common stock at an exercise price of $11.00 per share. | ||||||
In accordance with accounting guidance for warrants for shares in redeemable securities, the Company classified warrants for convertible preferred stock as liabilities on the consolidated balance sheet based on fair value and increases or decreases in the fair value of such warrants were recorded as other income (expense) in the consolidated statement of operations and comprehensive loss. Upon the closing of the Company's IPO on November 29, 2010, all preferred stock converted into common stock. The warrants were converted into warrants to purchase common stock and reclassed from a liability to equity. |
StockBased_Compensation
Stock-Based Compensation | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ||||||||||||
Stock-Based Compensation | ' | ||||||||||||
Stock-Based Compensation | |||||||||||||
Stock Option Plans | |||||||||||||
During 2006, the Company adopted the 2006 Equity Incentive Award Plan (as amended, the 2006 Plan) under which 1,134,000 shares of common stock were reserved for issuance to employees, directors and consultants of the Company at December 31, 2011 and 2010. The 2006 Plan provides for the grant of incentive stock options, non-qualified stock options and rights to purchase restricted stock to eligible recipients. Recipients of stock options are eligible to purchase shares of the Company’s common stock at an exercise price equal to no less than the estimated fair market value of such stock on the date of grant. The maximum term of options granted under the 2006 Plan is ten years. | |||||||||||||
Options granted pursuant to the 2006 Plan generally vest over four years at a rate of 25% upon the first anniversary of the vesting commencement date and 1/48th per month thereafter. The 2006 Plan allows the option holders to exercise their options early and acquire option shares, which are then subject to repurchase by the Company at the original exercise price of such options. At December 31, 2013 and 2012 there were zero unvested shares of common stock issued to employees of the Company in connection with the early exercise of stock option grants. | |||||||||||||
During 2010, the Company adopted the 2010 Equity Incentive Award Plan (the 2010 Plan), which became effective immediately prior to the completion of the IPO. An initial 2,243,668 shares were reserved for issuance to employees, directors and consultants of the Company under the 2010 plan. The number of shares initially reserved were subsequently increased by the number of shares of common stock related to awards granted under the 2006 Plan that are repurchased, forfeited, expired or are cancelled on or after the effective date of the 2010 Plan, as well as an annual increase pursuant to an evergreen provision. The 2010 Plan provides for the grant of incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock units and rights to purchase restricted stock to eligible recipients. Recipients of stock options are eligible to purchase shares of the Company’s common stock at an exercise price equal to no less than the estimated fair market value of such stock on the date of grant. The maximum term of options granted under the 2010 Plan is ten years. | |||||||||||||
Options granted pursuant to the 2010 Plan generally vest over four years and vest at a rate of 25% upon the first anniversary of the vesting commencement date and 1/48th per month thereafter. Restricted stock units granted pursuant to the 2010 Plan vest on the first anniversary of the vesting commencement date. | |||||||||||||
In June 2012, the Company amended and restated the 2010 Plan (the Restated 2010 Plan). Pursuant to the Restated 2010 Plan, the number of shares that are reserved for issuance under the 2010 Plan was increased to 9,300,000, plus any shares related to outstanding options granted under the 2006 Plan that are repurchased, forfeited, expire or are canceled on or after the effective date of the Restated 2010 Plan. Further, the 2010 Plan's evergreen provision was amended such that, commencing on January 1, 2013, and on each January 1 thereafter during the term of the Restated 2010 Plan, the aggregate number of shares available for issuance under the Restated 2010 Plan shall be increased by that number of shares of the Company's common stock equal to the lower of: | |||||||||||||
• | 4% of the Company’s outstanding common stock on the applicable January 1; or | ||||||||||||
• | an amount determined by the board of directors. | ||||||||||||
At December 31, 2013 and 2012, 456,854 and 701,976 shares of common stock were available for future issuance under the Restated 2010 Plan, respectively. | |||||||||||||
On December 4, 2013, the Company adopted the Employment Inducement Equity Incentive Award Plan (the Inducement Plan). The terms of the Inducement Plan are substantially similar to the terms of the Company’s 2010 Equity Incentive Award Plan with two principal exceptions: (1) incentive stock options may not be granted under the Inducement Plan; and (2) the annual compensation paid by the Company to specified executives will be deductible only to the extent that it does not exceed $1,000,000, as the conditions of Section 162(m) of the Internal Revenue Code will not be met. The Inducement Plan was adopted by the board of directors without stockholder approval pursuant to Rule 5635(c)(4) of the NASDAQ Listing Rules. | |||||||||||||
The Company has initially reserved 2,700,000 shares of the Company’s common stock for issuance pursuant to awards granted under the Inducement Plan. In accordance with Rule 5635(c)(4) of the NASDAQ Listing Rules, awards under the Inducement Plan may only be made to an employee who has not previously been an employee or member of the board of directors of the Company or any parent or subsidiary, or following a bona fide period of non-employment by the Company or a parent or subsidiary, if he or she is granted such award in connection with his or her commencement of employment with the Company or a subsidiary and such grant is an inducement material to his or her entering into employment with the Company or such subsidiary. At December 31, 2013, 1,728,000 shares of common stock were available for future issuance under the Inducement Plan. | |||||||||||||
The 2006 Plan, Restated 2010 Plan and Inducement Plan are intended to encourage ownership of stock by employees, consultants and non-employee directors of the Company, as applicable, and with respect to the 2006 Plan and Restated 2010 Plan, to provide additional incentives for them to promote the success of the Company’s business. The board of directors is responsible for determining the individuals to receive equity grants, the number of shares subject to each grant, the exercise price per share and the exercise period of each option. The Company satisfies option exercises through issuance of new shares. | |||||||||||||
Information with respect to the number and weighted average exercise price of stock options under the 2006 Plan, 2010 Restated Plan and Inducement Plan is summarized as follows: | |||||||||||||
Shares | Weighted | Weighted | Aggregate | ||||||||||
(in thousands) | Average | Average | Intrinsic | ||||||||||
Exercise | Remaining | Value | |||||||||||
Price | Contractual | (in thousands) | |||||||||||
Term (years) | |||||||||||||
Outstanding at December 31, 2012 | 9,901 | $ | 2.64 | ||||||||||
Granted | 5,257 | $ | 2.16 | ||||||||||
Exercised | (291 | ) | $ | 1.97 | |||||||||
Canceled/Forfeited | (1,338 | ) | $ | 2.7 | |||||||||
Outstanding at December 31, 2013 | 13,529 | $ | 2.46 | 8.3 | $ | 15,266 | |||||||
Exercisable at December 31, 2013 | 5,617 | $ | 2.73 | 7.6 | $ | 5,484 | |||||||
Vested and unvested expected to vest at December 31, 2013 | 12,997 | $ | 2.47 | 8.3 | $ | 14,622 | |||||||
At December 31, 2013, 1,331,000 restricted stock units were outstanding with a weighted average remaining contractual term of 0.4 years and an aggregate intrinsic value of $4,577,000. All restricted stock units outstanding were granted during the year ended December 31, 2013. No restricted stock units were exercisable at December 31, 2013, but 1,301,000 unvested restricted stock units are expected to vest at December 31, 2013. | |||||||||||||
The intrinsic values for stock options and restricted stock units above represent the aggregate value of the total pre-tax intrinsic value based upon a common stock price of $3.44 at December 31, 2013, and the contractual exercise prices. | |||||||||||||
Years Ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Stock Options and Restricted Stock Units | |||||||||||||
Weighted-average grant date fair value | $ | 1.58 | $ | 1.35 | $ | 2.88 | |||||||
Aggregate intrinsic value of options exercised | $ | 370,000 | $ | 9,000 | $ | 226,000 | |||||||
Total fair value of shares vested | $ | 4,895,000 | $ | 3,564,000 | $ | 2,340,000 | |||||||
Employee Stock Purchase Plan | |||||||||||||
During 2010, the Company adopted the 2010 Employee Stock Purchase Plan (the Purchase Plan), which allows employees to purchase shares of the Company’s common stock during a specified offering period. The purchase price is 85% of the lower of the closing price of the stock on the first day of the offering period or the closing price of the stock on the date of purchase. Eligible employees may elect to withhold up to 20% of their compensation during any offering period for the purchase of stock up to a maximum of 20,000 shares per purchase period. At December 31, 2013 and 2012, a total of 409,646 and 463,973 shares of common stock were reserved for issuance under the Purchase Plan, respectively. The length of the offering period is determined by the compensation committee and may be up to 27 months long. The first offering period under the Purchase Plan was from June 1, 2011 through May 31, 2012 with two purchase periods of six months each. A total of 99,024, 205,303, 138,826 and 225,053 shares were purchased under the Purchase Plan in November 2013, May 2013, November 2012 and May 2012, respectively. | |||||||||||||
Stock-Based Compensation | |||||||||||||
The Company uses the Black-Scholes option-pricing model for determining the estimated fair value and stock-based compensation for stock-based awards to employees and the board of directors. The assumptions used in the Black-Scholes option-pricing model are as follows: | |||||||||||||
Year Ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Stock Options | |||||||||||||
Risk free interest rate | 0.8% to 1.8% | 0.2% to 1.2% | 1.2% to 2.6% | ||||||||||
Expected term | 5.0 to 6.1 years | 5.0 to 6.1 years | 5.1 to 6.1 years | ||||||||||
Expected volatility | 82.8 to 87.9% | 80.1% to 86.8% | 72.3% to 89.7% | ||||||||||
Expected dividend yield | —% | —% | —% | ||||||||||
Employee Stock Purchase Plan | |||||||||||||
Risk free interest rate | 0.10% | 0.10% | 0.10% | ||||||||||
Expected term | 0.5 to 1.0 years | 0.5 to 1.0 years | 0.5 to 1.0 years | ||||||||||
Expected volatility | 74.3% to 125.6% | 81.5% to 85.7% | 75.2% to 77.1% | ||||||||||
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, when necessary, 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): | |||||||||||||
Year Ended December 31, | |||||||||||||
2013 | 2012 | 2012 | |||||||||||
Cost of sales | $ | 333 | $ | 181 | $ | 137 | |||||||
Research and development | 1,138 | 921 | 768 | ||||||||||
Selling, general and administrative | 6,535 | 5,055 | 3,904 | ||||||||||
Total | $ | 8,006 | $ | 6,157 | $ | 4,809 | |||||||
As of December 31, 2013, there was approximately $12,647,000 of total unrecognized compensation costs related to outstanding employee and board of director options and restricted stock units, which is expected to be recognized over a weighted average period of 2.7 years. | |||||||||||||
At December 31, 2013, there were 182,000 unvested stock options and 25,000 restricted stock units outstanding to consultants, with approximately $574,000 of related unrecognized compensation expense based on a December 31, 2013 measurement date. These unvested stock options outstanding to consultants are expected to vest over approximately 3.3 years, and the restricted stock units outstanding to consultants are expected to vest over approximately 0.4 years. In accordance with accounting guidance for stock-based compensation, the Company re-measures the fair value of stock option grants to non-employees at each reporting date and recognizes the related income or expense during their vesting period. Expense recognized for stock options and restricted stock units to consultants was $323,000 for the year ended December 31, 2013 and was immaterial for the years ended December 31, 2012 and 2011. Stock option expense for awards issued to consultants is included in the consolidated statement of operations and comprehensive loss within selling, general and administrative expense in the year ended December 31, 2013 and 2012, and within research and development expense in the year ended December 31, 2011. |
Employee_Benefit_Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2013 | |
Postemployment Benefits [Abstract] | ' |
Employee Benefit Plan | ' |
Employee Benefit Plan | |
Effective February 1, 2007, the Company has established a defined contribution 401(k) plan (the Plan) for all employees who are at least 21 years of age. Employees are eligible to participate in the Plan beginning on the first day of the month following one month of employment. Under the terms of the Plan, employees may make voluntary contributions as a percentage of compensation. The Company’s contributions to the Plan are discretionary, and no contributions have been made by the Company to date. |
Income_Taxes
Income Taxes | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Income Tax Disclosure [Abstract] | ' | |||||||||||
Income Taxes | ' | |||||||||||
Income Taxes | ||||||||||||
The Company only recognizes tax benefits if it is more-likely-than-not to be sustained upon audit by the relevant taxing authority based upon its technical merits. An uncertain income tax position will not be recognized if it has less than a 50% likelihood of being sustained. The balance of unrecognized tax benefits at December 31, 2013 of $899,000 are tax benefits that, if we recognize them, would not impact our effective tax rate as long as they remain subject to a full valuation allowance. | ||||||||||||
The following table summarizes the activity related to the Company’s unrecognized tax benefits (in thousands): | ||||||||||||
December 31, | ||||||||||||
2013 | 2012 | |||||||||||
Beginning balance of unrecognized tax benefits | $ | 714 | $ | 678 | ||||||||
Gross increases based on tax positions related to current year | 185 | 36 | ||||||||||
Gross increases based on tax positions related to prior year | — | — | ||||||||||
Settlements with taxing authorities | — | — | ||||||||||
Expiration of statute of limitations | — | — | ||||||||||
Ending balance of unrecognized tax benefits | $ | 899 | $ | 714 | ||||||||
The Company’s policy is to recognize interest and/or penalties related to income tax matters in income tax expense. The Company had no accrued interest or penalties on the consolidated balance sheets at December 31, 2013 and 2012 and has recognized no interest and/or penalties in the consolidated statements of operations and comprehensive loss through the year ended December 31, 2013. | ||||||||||||
The Company is subject to taxation in the U.S. and state jurisdictions. The Company’s tax years for 2006 and forward can be subject to examination by the United States and state tax authorities due to the carry forward of net operating losses. | ||||||||||||
At December 31, 2013, the Company had available federal and state income tax net operating loss carryforwards of approximately $208,131,000 and $202,100,000, respectively. The federal tax loss carryforwards will begin expiring in 2026 unless previously utilized, and the state tax loss carryforwards will begin expiring in 2015 unless previously utilized. In addition, the Company has federal and California research and development income tax credit carryforwards of $1,088,000 and $2,217,000, respectively. The federal research and development income tax credit carryforwards will begin to expire in 2026 unless previously utilized. The California research and development income tax credit carryforwards will carry forward indefinitely until utilized. | ||||||||||||
In January 2013, the American Taxpayer Relief Act of 2012 (the “Act”) was signed into law. The Act retroactively restored several expired business tax provisions, including the research and experimentation credit. The additional credits that were reported within the 2013 consolidated financial statements have no impact on operations due to the existence of a full valuation allowance on all deferred tax assets. | ||||||||||||
The Company has completed an analysis under Internal Revenue Service Code (IRC) Sections 382 and 383 to determine if the Company’s net operating loss carryforwards and research and development credits are limited due to a change in ownership. The Company has determined that as of December 31, 2011 the Company had two ownership changes. The first ownership change occurred in August 2006 upon the issuance of the Series A-1 convertible preferred. As a result of this ownership change, the Company has reduced its net operating loss carryforwards by $1,900,000 and research and development income tax credits by $8,000. The Company had a second ownership change as defined by IRC Sections 382 and 383, which occurred in September 2011 upon the issuance of common stock in its follow-on offering. As a result of the second ownership change, the Company has reduced its federal net operating loss carryforwards as of December 31, 2010 by $83,503,000 and research and development income tax credits as of December 31, 2010 by $2,203,000. The Company also reduced its California net operating loss carryforwards as of December 31, 2010 by $46,243,000 as a result of the second ownership change. Pursuant to IRC Section 382 and 383, use of the Company’s net operating loss and research and development income tax credit carryforwards may be limited in the event of a future cumulative change in ownership of more than 50% within a three-year period. The Company is currently in the process of completing a Section 382 and 383 study to determine the impact that ownership changes during the year ended December 31, 2013 have had on its carryforwards and expects to complete the analysis within the next twelve months. As a result of this analysis, the Company may have an adjustment in the net operating losses that are recorded at December 31, 2013. | ||||||||||||
The reconciliation of income tax computed at the Federal statutory tax rate to the expense (benefit) for income taxes is as follows (in thousands): | ||||||||||||
December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Tax at statutory rate | $ | (27,491 | ) | $ | (16,109 | ) | $ | (28,530 | ) | |||
State taxes, net of federal benefit | (1,821 | ) | (1,580 | ) | (2,780 | ) | ||||||
Change in valuation allowance | 22,602 | 21,990 | (16,807 | ) | ||||||||
Section 382 limitation | — | — | 45,728 | |||||||||
Permanent Interest Disallowed | 7,197 | (4,466 | ) | (70 | ) | |||||||
Credits and other | (487 | ) | 170 | 2,450 | ||||||||
$ | — | $ | 5 | $ | (9 | ) | ||||||
Significant components of the Company’s deferred tax assets as of December 31, 2013 and 2012 are listed below. A valuation allowance of $102,949,000 and $80,347,000 for the years ended December 31, 2013 and 2012, respectively, has been established to offset the deferred tax assets as realization of such assets is uncertain. The components of the deferred tax assets are as follows (in thousands): | ||||||||||||
December 31, | ||||||||||||
2013 | 2012 | |||||||||||
Deferred tax assets: | ||||||||||||
Net operating losses | $ | 80,388 | $ | 61,739 | ||||||||
Capitalized research and development | 8,172 | 8,903 | ||||||||||
Accrued expenses | 3,263 | 3,707 | ||||||||||
Research and development credits | 2,010 | 1,237 | ||||||||||
Accrued product returns | 2,029 | 1,087 | ||||||||||
Inventory reserve and UNICAP | 660 | 688 | ||||||||||
Depreciation and amortization | 1,691 | 645 | ||||||||||
Other, net | 4,736 | 2,341 | ||||||||||
Total deferred tax assets | 102,949 | 80,347 | ||||||||||
Less valuation allowance | (102,949 | ) | (80,347 | ) | ||||||||
Net deferred tax assets | $ | — | $ | — | ||||||||
The Company did not incur any income tax expense for the year ended December 31, 2013 and incurred $5,000 in income tax expense for the year ended December 31, 2012 related to taxable income generated by its wholly-owned subsidiary Zogenix Europe Limited. |
Summarized_Quarterly_Data_Unau
Summarized Quarterly Data (Unaudited) | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | |||||||||||||||
Summarized Quarterly Data (Unaudited) | ' | |||||||||||||||
Summarized Quarterly Data (Unaudited) | ||||||||||||||||
The following financial information reflects all adjustments, which include only normal recurring adjustments, which are, in the opinion of management, necessary for a fair statement of the consolidated financial results of the interim periods. Summarized quarterly data for the years ended December 31, 2013 and 2012 is as follows: | ||||||||||||||||
2013 Quarter Ended | ||||||||||||||||
March 31, | June 30, | September 30, | December 31, | |||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||
Revenue | $ | 6,981 | $ | 8,942 | $ | 7,168 | $ | 9,921 | ||||||||
Cost of Sales | $ | 4,158 | $ | 4,630 | $ | 5,354 | $ | 7,099 | ||||||||
Gross Profit (1) | $ | 2,823 | $ | 4,312 | $ | 1,814 | $ | 2,822 | ||||||||
Net loss | $ | (21,055 | ) | $ | (13,332 | ) | $ | (10,852 | ) | $ | (35,617 | ) | ||||
Net loss per share, basic and diluted | $ | (0.21 | ) | $ | (0.13 | ) | $ | (0.10 | ) | $ | (0.28 | ) | ||||
Weighted-average shares outstanding, basic and diluted | 100,809 | 100,876 | 104,682 | 127,869 | ||||||||||||
2012 Quarter Ended | ||||||||||||||||
March 31, | June 30, | September 30, | December 31, | |||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||
Revenue | $ | 18,347 | $ | 8,030 | $ | 8,453 | $ | 9,496 | ||||||||
Cost of Sales | $ | 5,062 | $ | 4,167 | $ | 4,249 | $ | 6,018 | ||||||||
Gross Profit (1) | $ | 13,285 | $ | 3,863 | $ | 4,204 | $ | 3,478 | ||||||||
Net loss | $ | (10,292 | ) | $ | (17,169 | ) | $ | (19,282 | ) | $ | (643 | ) | ||||
Net loss per share, basic and diluted | $ | (0.16 | ) | $ | (0.26 | ) | $ | (0.21 | ) | $ | (0.01 | ) | ||||
Weighted-average shares outstanding, basic and diluted | 65,369 | 65,449 | 90,370 | 100,714 | ||||||||||||
(1) Gross Profit is calculated as Total Revenues less Cost of Sales. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 12 Months Ended | ||
Dec. 31, 2013 | |||
Accounting Policies [Abstract] | ' | ||
Use of Estimates | ' | ||
Use of Estimates | |||
The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States (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 materially from those estimates. | |||
Principles of Consolidation | ' | ||
Principles of Consolidation | |||
The 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. | |||
Cash and Cash Equivalents | ' | ||
Cash and Cash Equivalents | |||
The Company considers cash equivalents to be only those investments which are highly liquid, readily convertible to cash and have an original maturity of three months or less when purchased. | |||
Accounts Receivable | ' | ||
Accounts Receivable | |||
Trade accounts receivable are recorded at the invoice amount net of allowances for cash discounts for prompt payment. The Company evaluates the collectability of its accounts receivable based on a variety of factors including the length of time the receivables are past due, the financial health of the customer and historical experience. | |||
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 (excluding the tail payment due to Astellas Pharmaceutical US, Inc. (Astellas)) 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 accrued liability for the annual tail payment due to Astellas (see Note 3) for the termination of the Company’s co-promotion agreement was measured at fair value 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 liability within Level 3 of the fair value hierarchy because they are valued using valuation models with significant unobservable inputs. | |||
Concentration of Credit Risk, Sources of Supply and Significant Customers | ' | ||
Concentration of Credit Risk, Sources of Supply and Significant Customers | |||
Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and trade accounts receivable. The Company maintains accounts in federally insured financial institutions in excess of federally insured limits. The Company also maintains investments in money market funds and that are not federally insured. However, management believes the Company is not exposed to significant credit risk due to the financial position of the depository institutions in which these deposits are held and of the money market funds and other entities in which these investments are made. Additionally, the Company has established guidelines regarding the diversification of its investments and their maturities, which are designed to maintain safety and liquidity. | |||
The Company sells its products primarily to established wholesale distributors and retailers in the pharmaceutical industry. Three wholesale pharmaceutical distributors individually comprised 30.5%, 30.3% and 16.6% of the Company’s total gross sales of Sumavel DosePro for the year ended December 31, 2013. In addition, one retail company that purchases from the Company directly, individually comprised 14.6% of the Company's total gross sales of Sumavel DosePro for the year ended December 31, 2013. Approximately 84.9% and 10.3% of the trade accounts receivable balance as of December 31, 2013 represents amounts due from these three wholesale distributors and one retail customer, respectively. Credit is extended based on an evaluation of the customer’s financial condition, and collateral is not required. The Company evaluates the collectability of its accounts receivable based on a variety of factors including the length of time the receivables are past due, the financial health of the customer and historical experience. Based upon the review of these factors, the Company recorded an allowance of doubtful accounts of $18,000 and $2,000 at December 31, 2013 and December 31, 2012, respectively. | |||
The Company relies on third-party manufacturers for the production of Sumavel DosePro and single source third-party suppliers to manufacture several key components of Sumavel DosePro. The Company also relies on a third-party manufacturer and supplier of Zohydro ER. If the Company’s third-party manufacturers are unable to continue manufacturing Sumavel DosePro or Zohydro ER, or if the Company lost one or more of its single source suppliers used in the manufacturing process, the Company may not be able to meet market demand for its products. | |||
Inventory | ' | ||
Inventory | |||
Inventory is stated at the lower of cost or market. Cost includes amounts related to materials, labor and overhead, and is determined in a manner which approximates the first-in, first-out (FIFO) method. The Company provides reserves for potentially excess, dated or obsolete inventories based on an analysis of inventory on hand and on firm purchase commitments compared to forecasts of future sales. | |||
Property and Equipment, Net | ' | ||
Property and Equipment, Net | |||
Property and equipment is recorded at cost, net of accumulated depreciation and amortization. Depreciation is calculated on a straight-line basis over the estimated useful lives of the respective assets, as follows: | |||
Computer equipment and software | 3 years | ||
Furniture and fixtures | 3-7 years | ||
Manufacturing equipment and tooling | 3-15 years | ||
Leasehold improvements | Shorter of estimated useful life or lease term | ||
Impairment of Long-Lived Assets | ' | ||
Impairment of Long-Lived Assets | |||
The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. | |||
Warrants for Common Stock | ' | ||
Warrants for Common Stock | |||
In accordance with accounting guidance for warrants for shares in redeemable securities or warrants that could be settled for cash, the Company classifies warrants for common stock as current liabilities on the consolidated balance sheet. The Company adjusts the carrying value of these warrants for common stock that can be settled in cash to their estimated fair value at each reporting date with the increases or decreases in the fair value of such warrants recorded as change in fair value of warrant liabilities in the consolidated statement of operations and comprehensive loss. | |||
Embedded Derivatives | ' | ||
Embedded Derivatives | |||
The Company records embedded derivatives in the consolidated balance sheet at fair value. The carrying value of the embedded derivatives are adjusted to their estimated fair value at each reporting date with the increases or decreases in the fair value of such embedded derivatives recorded as change in fair value of embedded derivatives in the consolidated statement of operations and comprehensive loss. | |||
Revenue Recognition | ' | ||
Revenue Recognition | |||
The Company recognizes revenue from the sale of Sumavel DosePro, and from license fees, milestones and service fees earned on collaborative arrangements. Revenue is recognized when (i) persuasive evidence of an arrangement exists, (ii) delivery has occurred and title has passed, (iii) the price is fixed or determinable and (iv) collectability is reasonably assured. Revenue from sales transactions where the buyer has the right to return the product is recognized at the time of sale only if (i) the Company’s price to the buyer is substantially fixed or determinable at the date of sale, (ii) the buyer has paid the Company, or the buyer is obligated to pay the Company and the obligation is not contingent on resale of the product, (iii) the buyer’s obligation to the Company would not be changed in the event of theft or physical destruction or damage of the product, (iv) the buyer acquiring the product for resale has economic substance apart from that provided by the Company, (v) the Company does not have significant obligations for future performance to directly bring about resale of the product by the buyer, and (vi) the amount of future returns can be reasonably estimated. | |||
Product Revenue, Net | |||
The Company sells Sumavel DosePro product in the United States to wholesale pharmaceutical distributors and retail pharmacies, or collectively the Company's customers, subject to rights of return. The Company recognizes product sales at the time title transfers to its customer, and reduces product sales for estimated future product returns and sales allowances in the same period the related revenue is recognized. Product sales allowances include wholesaler and retail pharmacy distribution fees, prompt pay discounts, chargebacks, rebates and patient discount programs, and are based on amounts owed or to be claimed on the related sales. These estimates take into consideration the terms of the Company's agreements with its customers and third-party payors and the levels of inventory within the distribution and retail channels that may result in future rebates or discounts taken. In certain cases, such as patient support programs, the Company recognizes the cost of patient discounts as a reduction of revenue based on estimated utilization. If actual future results vary, the Company may need to adjust these estimates, which could have an effect on product revenue in the period of adjustment. | |||
Prior to the third quarter of 2011, Sumavel DosePro had a limited sales history, and the Company could not reliably estimate expected returns of the product at the time of shipment. Accordingly, the Company deferred recognition of revenue on product shipments of Sumavel DosePro until the right of return no longer existed, which occurred at the earlier of the time Sumavel DosePro units were dispensed through patient prescriptions or expiration of the right of return. Units dispensed are generally not subject to return, except in the rare cases where the product malfunctions or the product is damaged in transit. The Company estimates patient prescriptions dispensed using an analysis of third-party information, including third-party market research data. | |||
Product Returns. The Company's estimated product return allowances for Sumavel DosePro require a high degree of judgment and are subject to change based on the Company's experience and certain quantitative and qualitative factors. Sumavel DosePro's shelf life is determined by the shorter expiry date of its two subassemblies, which is currently approximately 30 months from the date of manufacture. The Company's return policy allows for customers to return unused product that is within six months before and up to one year after its expiration date for a credit at the then-current wholesaler acquisition cost, or WAC, reduced by a nominal fee for processing the return. | |||
The Company has monitored and analyzed actual return history since product launch. The Company's analysis of actual product return history considers actual product returns on an individual product lot basis since product launch, the dating of the 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 to estimate its exposure for returned product. Because of the shelf life of Sumavel DosePro and the duration of time under which the Company's customers may return product through the Company's return policy, there may be a significant period of time between when the product is shipped and when the Company issues credits on returned product. Based on the Company's analysis of actual product return history, 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 and earnings for the year ended December 31, 2013 and increased net loss by $0.03 per share for the year ended December 31, 2013. Further, as a result of the Company’s third quarter 2013 product returns analysis, the Company began to utilize a higher product returns rate for Sumavel DosePro sales. | |||
The Company permits certain wholesale pharmaceutical distributors to purchase limited quantities of product after the announcement of an increase to the WAC of the Company’s product and prior to the effectiveness of the increase. In turn, WAC price increases can result in accelerated purchases by wholesalers relative to anticipated retail and prescription demand. The timing of purchases made by wholesale distributors and retail pharmacies are subject to fluctuations for these reasons among others. | |||
Wholesaler and Retail Pharmacy Distribution Fees. The Company offers distribution fees to certain wholesale distributors and retail pharmacies based on contractually determined rates. The Company accrues the distribution fees on shipment to the respective wholesale distributors and retail pharmacies and recognizes the distribution fees as a reduction of revenue in the same period the related revenue is recognized. | |||
Prompt Pay Discounts. The Company offers cash discounts to its customers, generally 2% of the sales price, as an incentive for prompt payment. The Company accounts for cash discounts by reducing accounts receivable by the prompt pay discount amount and recognizes the discount as a reduction of revenue in the same period the related revenue is recognized. | |||
Chargebacks. The Company provides discounts primarily to authorized users of the Federal Supply Schedule (FSS) of the General Services Administration under an FSS contract negotiated by the Department of Veterans Affairs and various organizations under Medicaid contracts and regulations. These entities purchase products from the wholesale distributors at a discounted price, and the wholesale distributors then charge back to the Company the difference between the current retail price and the price the federal entity paid for the product. The Company estimates and accrues chargebacks based on estimated wholesaler inventory levels, current contract prices and historical chargeback activity. Chargebacks are recognized as a reduction of revenue in the period the related revenue is recognized. | |||
Rebates. The Company participates in certain rebate programs, which provide discounted prescriptions to qualified insured patients. Under these rebate programs, the Company pays a rebate to the third-party administrator of the program, generally two to three months after the quarter in which prescriptions subject to the rebate are filled. The Company estimates and accrues these rebates based on current contract prices, historical and estimated future percentages of product sold to qualified patients and estimated levels of inventory in the distribution channel. Rebates are recognized as a reduction of revenue in the period the related revenue is recognized. | |||
Patient Discount Programs. The Company offers discount card programs to patients for Sumavel DosePro in which patients receive discounts on their prescriptions that are reimbursed by the Company. The Company estimates the total amount that will be redeemed based on levels of inventory in the distribution and retail channels and recognizes the discount as a reduction of revenue in the same period the related revenue is recognized. | |||
Contract Revenue | |||
Contract revenue consists of the amortization of license fees and milestone payments received under co-promotion agreements, which have multiple deliverables. Revenue arrangements with multiple deliverables are divided into separate units of accounting if criteria are met, including whether the deliverable has stand-alone value to the customer and the customer has a general right of return relative to the delivered item and delivery or performance of the undelivered item is probable and substantially within the vendor's control. Arrangement consideration is allocated at the inception of the arrangement to all deliverables on the basis of their relative selling price. The selling price for each deliverable is determined using: (i) vendor-specific objective evidence of selling price (VSOE), if it exists, (ii) third-party evidence of selling price (TPE) if VSOE does not exist, and (iii) the Company's best estimate of the selling price if neither VSOE nor TPE exists. For transactions entered into prior to January 1, 2011, revenue was recognized for each deliverable based upon the applicable revenue recognition criteria discussed above and upon acceptance of goods or performance of service. Effective January 1, 2011, for new or significantly modified transactions, the Company allocates revenue consideration, excluding contingent consideration, based on the relative selling prices of the separate units of accounting contained within an arrangement containing multiple deliverables. | |||
Service and Other Revenue | |||
Service and other revenue primarily consists of payments received for the Company's sales efforts under the co-promotion agreement with Valeant Pharmaceuticals North America LLC (Valeant). The Company recognizes service and other revenue at the time services have been rendered. | |||
Collaborative Arrangements | ' | ||
Collaborative Arrangements | |||
The Company records certain transactions between collaborators in the consolidated statement of operations and comprehensive loss on either a gross or net basis within revenues or operating expenses, depending on the characteristics of the collaboration relationship, and provides for enhanced disclosure of collaborative relationships. The Company evaluates its collaborative agreements for proper classification of shared expenses, license fees, milestone payments and any reimbursed costs within the consolidated statement of operations and comprehensive loss based on the nature of the underlying activity. If payments to and from collaborative partners are not within the scope of other authoritative accounting literature, the statement of operations and comprehensive loss classification for the payments is based on a reasonable, rational analogy to authoritative accounting literature that is applied in a consistent manner. For collaborations relating to commercialized products, if the Company acts as the principal in the sale of goods or services, the Company records revenue and the corresponding operating costs in its respective line items within the consolidated statement of operations and comprehensive loss based on the nature of the shared expenses. Per authoritative accounting guidance, the principal is the party who is responsible for delivering the product to the customer, has latitude with establishing price and has the risks and rewards of providing product to the customer, including inventory and credit risk. | |||
Research and Development Expenses | ' | ||
Research and Development Expenses | |||
All costs of research and development are expensed in the period incurred. Research and development costs primarily consist of salaries and related expenses for personnel, stock-based compensation expense, outside service providers, facilities costs, fees paid to consultants, milestone payments prior to FDA approval, license fees prior to FDA approval, professional services, travel costs, dues and subscriptions, depreciation and materials used in clinical trials and research and development. The Company expenses costs relating to the purchase and production of pre-approval inventories as research and development expense in the period incurred until FDA approval is received. | |||
The Company reviews and accrues expenses related to clinical trials based on work performed, which relies on estimates of total costs incurred based on completion of patient studies and other events. The Company follows this method since reasonably dependable estimates of the costs applicable to various stages of a research agreement or clinical trial can be made. Accrued clinical development costs are subject to revisions as trials progress to completion. Revisions are charged to expense in the period in which the facts that give rise to the revision become known. | |||
Advertising Expense | ' | ||
Advertising Expense | |||
The Company records the cost of its advertising efforts when services are performed or goods are delivered. | |||
Income Taxes | ' | ||
Income Taxes | |||
Deferred tax assets and liabilities are determined based on the differences between the financial reporting and tax basis of assets and liabilities using enacted tax rates which will be in effect when the differences reverse. The Company provides a valuation allowance against net deferred tax assets unless, based upon the available evidence, it is more likely than not that the deferred tax asset will be realized. The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. | |||
Foreign Currency Transactions | ' | ||
Foreign Currency Transactions | |||
Gains or losses resulting from transactions denominated in foreign currencies are included in other expense in the consolidated statements of operations and comprehensive loss. | |||
Stock-Based Compensation | ' | ||
Stock-Based Compensation | |||
Stock-based compensation cost is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense over the employee’s requisite service period on a straight-line basis. As of December 31, 2013, there were no outstanding equity awards with market or performance conditions. Equity awards issued to non-employees are recorded at their fair value on the measurement date and are re-measured at each reporting date as the underlying awards vest unless the instruments are fully vested, immediately exercisable and nonforfeitable on the date of grant. | |||
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, restricted stock units, warrants and common stock subject to repurchase 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 development and commercialization of pharmaceutical products for people living with pain-related conditions and central nervous system disorders. | |||
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) | 12 Months Ended | |||||||||||||
Dec. 31, 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 December 31, 2013 and December 31, 2012 are as follows (in thousands): | ||||||||||||||
Fair Value Measurements at Reporting Date Using | ||||||||||||||
Quoted Prices | Significant | Significant | Total | |||||||||||
in Active | Other | Unobservable | ||||||||||||
Markets for | Observable | Inputs | ||||||||||||
Identical Assets | Inputs | (Level 3) | ||||||||||||
(Level 1) | (Level 2) | |||||||||||||
At December 31, 2013 | ||||||||||||||
Assets | ||||||||||||||
Cash equivalents (1) | $ | 69,120 | — | — | $ | 69,120 | ||||||||
Liabilities | ||||||||||||||
Common stock warrant liabilities (2) | $ | — | — | 31,341 | $ | 31,341 | ||||||||
Embedded derivative liability (3) | $ | — | — | 233 | $ | 233 | ||||||||
At December 31, 2012 | ||||||||||||||
Assets | ||||||||||||||
Cash equivalents (1) | $ | 37,605 | — | — | $ | 37,605 | ||||||||
Liabilities | ||||||||||||||
Common stock warrant liability (2) | $ | — | — | 9,493 | $ | 9,493 | ||||||||
Embedded derivative liability (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 sheet. | |||||||||||||
-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 8) and warrants issued in connection with the Healthcare Royalty financing agreement (see Note 7), 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 and the timing of such event; and for the valuation scenario in which an extraordinary event occurs that is not an all cash transaction or an event whereby a public acquirer would assume the warrants, (b) an expected volatility rate using the Company's historical volatility, supplemented with historical volatility of comparable companies, through the projected date of public announcement of an extraordinary transaction, blended with a 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 derivatives are 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 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 of the liability. Management's revenue projections used in the December 31, 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 liability as of December 31, 2013. | |||||||||||||
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 unobservable inputs (Level 3) for the years ended December 31, 2013 and 2012 (in thousands): | ||||||||||||||
Common Stock | Embedded | |||||||||||||
Warrant Liabilities | Derivative | |||||||||||||
Liabilities | ||||||||||||||
Balance at December 31, 2011 | $ | 345 | $ | 845 | ||||||||||
Issuance | 20,959 | — | ||||||||||||
Changes in fair value | (11,811 | ) | 147 | |||||||||||
Balance at December 31, 2012 | 9,493 | 992 | ||||||||||||
Exercises | (79 | ) | — | |||||||||||
Changes in fair value | 21,927 | (759 | ) | |||||||||||
Balance at December 31, 2013 | $ | 31,341 | $ | 233 | ||||||||||
Property and Equipment Useful Lives | ' | |||||||||||||
Depreciation is calculated on a straight-line basis over the estimated useful lives of the respective assets, as follows: | ||||||||||||||
Computer equipment and software | 3 years | |||||||||||||
Furniture and fixtures | 3-7 years | |||||||||||||
Manufacturing equipment and tooling | 3-15 years | |||||||||||||
Leasehold improvements | Shorter of estimated useful life or lease term | |||||||||||||
Property and Equipment, Net (in thousands) | ||||||||||||||
December 31, | ||||||||||||||
2013 | 2012 | |||||||||||||
Machinery, equipment and tooling | $ | 12,479 | $ | 12,325 | ||||||||||
Construction in progress | 6,222 | 5,068 | ||||||||||||
Computer equipment and software | 951 | 961 | ||||||||||||
Leasehold improvements | 783 | 783 | ||||||||||||
Furniture and fixtures | 628 | 685 | ||||||||||||
Property and equipment, at cost | 21,063 | 19,822 | ||||||||||||
Less accumulated depreciation | (8,052 | ) | (6,261 | ) | ||||||||||
$ | 13,011 | $ | 13,561 | |||||||||||
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): | ||||||||||||||
Year Ended December 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Numerator | ||||||||||||||
Net loss | $ | (80,856 | ) | $ | (47,386 | ) | $ | (83,903 | ) | |||||
Denominator | ||||||||||||||
Weighted average common shares outstanding | 108,568 | 80,558 | 42,715 | |||||||||||
Weighted average shares subject to repurchase | — | — | (3 | ) | ||||||||||
Weighted average shares outstanding, basic and diluted | 108,568 | 80,558 | 42,712 | |||||||||||
Basic and diluted net loss per share | $ | (0.74 | ) | $ | (0.59 | ) | $ | (1.96 | ) | |||||
Schedule of Calculation of Diluted Net Loss Per Share | ' | |||||||||||||
Potentially dilutive securities not included in the calculation of diluted net loss per share because to do so would be anti-dilutive are as follows (in thousands, of common equivalent shares): | ||||||||||||||
Year Ended December 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Common stock options and restricted stock units | 11,027 | 47 | 184 | |||||||||||
Common stock warrants | 15,681 | — | — | |||||||||||
26,708 | 47 | 184 | ||||||||||||
Consolidated_Balance_Sheet_Det1
Consolidated Balance Sheet Details (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Balance Sheet Related Disclosures [Abstract] | ' | |||||||
Inventory, Net | ' | |||||||
Inventory (in thousands) | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Raw materials | $ | 2,770 | $ | 4,867 | ||||
Work in process | 6,054 | 6,134 | ||||||
Finished goods | 1,112 | 1,885 | ||||||
$ | 9,936 | $ | 12,886 | |||||
Property and Equipment, Net | ' | |||||||
Depreciation is calculated on a straight-line basis over the estimated useful lives of the respective assets, as follows: | ||||||||
Computer equipment and software | 3 years | |||||||
Furniture and fixtures | 3-7 years | |||||||
Manufacturing equipment and tooling | 3-15 years | |||||||
Leasehold improvements | Shorter of estimated useful life or lease term | |||||||
Property and Equipment, Net (in thousands) | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Machinery, equipment and tooling | $ | 12,479 | $ | 12,325 | ||||
Construction in progress | 6,222 | 5,068 | ||||||
Computer equipment and software | 951 | 961 | ||||||
Leasehold improvements | 783 | 783 | ||||||
Furniture and fixtures | 628 | 685 | ||||||
Property and equipment, at cost | 21,063 | 19,822 | ||||||
Less accumulated depreciation | (8,052 | ) | (6,261 | ) | ||||
$ | 13,011 | $ | 13,561 | |||||
Other Assets | ' | |||||||
Other Assets (in thousands) | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Prepaid Aradigm royalty expense | $ | 2,571 | $ | 3,143 | ||||
Prepaid Alkermes royalty expense | 2,318 | — | ||||||
Debt acquisition costs | 969 | 1,217 | ||||||
Deposits | 431 | 840 | ||||||
Restricted cash | 200 | 200 | ||||||
Other assets | 125 | — | ||||||
$ | 6,614 | $ | 5,400 | |||||
Accrued Expenses | ' | |||||||
Accrued Expenses (in thousands) | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Accrued product returns | $ | 5,445 | $ | 3,034 | ||||
Accrued discounts and allowances | 4,239 | 4,088 | ||||||
Accrued interest expense, current portion | 3,033 | 2,526 | ||||||
Accrued clinical trial costs | 1,238 | 1,012 | ||||||
Accrued sales and marketing costs | 1,161 | 304 | ||||||
Astellas tail payment, current portion | 1,131 | 1,820 | ||||||
Other accrued expenses | 2,618 | 1,559 | ||||||
$ | 18,865 | $ | 14,343 | |||||
Other Long-Term Liabilities | ' | |||||||
Other Long-Term Liabilities (in thousands) | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Interest expense payable, less current portion | $ | 5,901 | $ | 2,607 | ||||
Deferred rent | 77 | 214 | ||||||
Embedded derivatives | 233 | 992 | ||||||
Astellas tail payment, less current portion | — | 975 | ||||||
Other long-term liabilities | 285 | 290 | ||||||
$ | 6,496 | $ | 5,078 | |||||
Restructuring_Tables
Restructuring (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Restructuring and Related Activities [Abstract] | ' | |||||||||||
Schedule of Restructuring Charges | ' | |||||||||||
The following table summarizes the components of the restructuring charges for the year ended December 31, 2013 (in thousands): | ||||||||||||
Twelve Months Ended December 31, 2013 | ||||||||||||
Accruals | Non-cash items | Total | ||||||||||
Employee-related charges | $ | 663 | $ | 201 | $ | 864 | ||||||
Other restructuring charges | 12 | — | 12 | |||||||||
$ | 675 | $ | 201 | $ | 876 | |||||||
Schedule of Restructuring Reserve | ' | |||||||||||
The following table sets forth activity in the restructuring liability for the twelve months ended December 31, 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 | (659 | ) | (12 | ) | (671 | ) | ||||||
Balance at December 31, 2013 | $ | 4 | $ | — | $ | 4 | ||||||
Commitments_Tables
Commitments (Tables) | 12 Months Ended | |||
Dec. 31, 2013 | ||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||
Schedule of Future Minimum Rental Payments for Operating Leases | ' | |||
Future minimum lease payments as of December 31, 2013 are as follows (in thousands): | ||||
2014 | $ | 1,330 | ||
2015 | 693 | |||
2016 | 43 | |||
2017 and thereafter | — | |||
Total | $ | 2,066 | ||
Debt_Tables
Debt (Tables) | 12 Months Ended | |||
Dec. 31, 2013 | ||||
Debt Disclosure [Abstract] | ' | |||
Schedule of Maturities of Long-term Debt | ' | |||
Maturities of long-term debt as of December 31, 2013, are as follows (in thousands): | ||||
2014 | 3,033 | |||
2015 | 15,930 | |||
2016 | 17,259 | |||
2017 | 16,668 | |||
2018 | 4,159 | |||
Total minimum payments | 57,049 | |||
Less amount representing interest | (27,049 | ) | ||
Total long-term debt | 30,000 | |||
Less current portion | — | |||
Long-term portion | $ | 30,000 | ||
Preferred_Stock_and_Stockholde1
Preferred Stock and Stockholders' Equity (Tables) | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
Equity [Abstract] | ' | |||||
Summary of Common Stock Reserved for Future Issuance | ' | |||||
Common stock reserved for future issuance is as follows (in thousands): | ||||||
December 31, | ||||||
2013 | 2012 | |||||
Stock options and restricted stock units outstanding | 14,859 | 9,901 | ||||
Warrants to purchase common stock | 16,189 | 16,292 | ||||
Shares authorized for future issuance under equity and purchase plans | 2,595 | 1,166 | ||||
33,643 | 27,359 | |||||
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ||||||||||||
Schedule of Stock-Based Compensation, Activity | ' | ||||||||||||
Information with respect to the number and weighted average exercise price of stock options under the 2006 Plan, 2010 Restated Plan and Inducement Plan is summarized as follows: | |||||||||||||
Shares | Weighted | Weighted | Aggregate | ||||||||||
(in thousands) | Average | Average | Intrinsic | ||||||||||
Exercise | Remaining | Value | |||||||||||
Price | Contractual | (in thousands) | |||||||||||
Term (years) | |||||||||||||
Outstanding at December 31, 2012 | 9,901 | $ | 2.64 | ||||||||||
Granted | 5,257 | $ | 2.16 | ||||||||||
Exercised | (291 | ) | $ | 1.97 | |||||||||
Canceled/Forfeited | (1,338 | ) | $ | 2.7 | |||||||||
Outstanding at December 31, 2013 | 13,529 | $ | 2.46 | 8.3 | $ | 15,266 | |||||||
Exercisable at December 31, 2013 | 5,617 | $ | 2.73 | 7.6 | $ | 5,484 | |||||||
Vested and unvested expected to vest at December 31, 2013 | 12,997 | $ | 2.47 | 8.3 | $ | 14,622 | |||||||
Schedule of Share-based Compensation, Additional Information | ' | ||||||||||||
Years Ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Stock Options and Restricted Stock Units | |||||||||||||
Weighted-average grant date fair value | $ | 1.58 | $ | 1.35 | $ | 2.88 | |||||||
Aggregate intrinsic value of options exercised | $ | 370,000 | $ | 9,000 | $ | 226,000 | |||||||
Total fair value of shares vested | $ | 4,895,000 | $ | 3,564,000 | $ | 2,340,000 | |||||||
Assumptions used in the Black-Scholes Option-Pricing Model | ' | ||||||||||||
The assumptions used in the Black-Scholes option-pricing model are as follows: | |||||||||||||
Year Ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Stock Options | |||||||||||||
Risk free interest rate | 0.8% to 1.8% | 0.2% to 1.2% | 1.2% to 2.6% | ||||||||||
Expected term | 5.0 to 6.1 years | 5.0 to 6.1 years | 5.1 to 6.1 years | ||||||||||
Expected volatility | 82.8 to 87.9% | 80.1% to 86.8% | 72.3% to 89.7% | ||||||||||
Expected dividend yield | —% | —% | —% | ||||||||||
Employee Stock Purchase Plan | |||||||||||||
Risk free interest rate | 0.10% | 0.10% | 0.10% | ||||||||||
Expected term | 0.5 to 1.0 years | 0.5 to 1.0 years | 0.5 to 1.0 years | ||||||||||
Expected volatility | 74.3% to 125.6% | 81.5% to 85.7% | 75.2% to 77.1% | ||||||||||
Expected dividend yield | —% | —% | —% | ||||||||||
Stock-Based Compensation Expense | ' | ||||||||||||
The Company recognized stock-based compensation expense as follows (in thousands): | |||||||||||||
Year Ended December 31, | |||||||||||||
2013 | 2012 | 2012 | |||||||||||
Cost of sales | $ | 333 | $ | 181 | $ | 137 | |||||||
Research and development | 1,138 | 921 | 768 | ||||||||||
Selling, general and administrative | 6,535 | 5,055 | 3,904 | ||||||||||
Total | $ | 8,006 | $ | 6,157 | $ | 4,809 | |||||||
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Income Tax Disclosure [Abstract] | ' | |||||||||||
Summary of Unrecognized Tax Benefits | ' | |||||||||||
The following table summarizes the activity related to the Company’s unrecognized tax benefits (in thousands): | ||||||||||||
December 31, | ||||||||||||
2013 | 2012 | |||||||||||
Beginning balance of unrecognized tax benefits | $ | 714 | $ | 678 | ||||||||
Gross increases based on tax positions related to current year | 185 | 36 | ||||||||||
Gross increases based on tax positions related to prior year | — | — | ||||||||||
Settlements with taxing authorities | — | — | ||||||||||
Expiration of statute of limitations | — | — | ||||||||||
Ending balance of unrecognized tax benefits | $ | 899 | $ | 714 | ||||||||
Reconciliation of Income Tax to Expense (Benefit) | ' | |||||||||||
The reconciliation of income tax computed at the Federal statutory tax rate to the expense (benefit) for income taxes is as follows (in thousands): | ||||||||||||
December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Tax at statutory rate | $ | (27,491 | ) | $ | (16,109 | ) | $ | (28,530 | ) | |||
State taxes, net of federal benefit | (1,821 | ) | (1,580 | ) | (2,780 | ) | ||||||
Change in valuation allowance | 22,602 | 21,990 | (16,807 | ) | ||||||||
Section 382 limitation | — | — | 45,728 | |||||||||
Permanent Interest Disallowed | 7,197 | (4,466 | ) | (70 | ) | |||||||
Credits and other | (487 | ) | 170 | 2,450 | ||||||||
$ | — | $ | 5 | $ | (9 | ) | ||||||
Schedule of Deferred Tax Assets | ' | |||||||||||
The components of the deferred tax assets are as follows (in thousands): | ||||||||||||
December 31, | ||||||||||||
2013 | 2012 | |||||||||||
Deferred tax assets: | ||||||||||||
Net operating losses | $ | 80,388 | $ | 61,739 | ||||||||
Capitalized research and development | 8,172 | 8,903 | ||||||||||
Accrued expenses | 3,263 | 3,707 | ||||||||||
Research and development credits | 2,010 | 1,237 | ||||||||||
Accrued product returns | 2,029 | 1,087 | ||||||||||
Inventory reserve and UNICAP | 660 | 688 | ||||||||||
Depreciation and amortization | 1,691 | 645 | ||||||||||
Other, net | 4,736 | 2,341 | ||||||||||
Total deferred tax assets | 102,949 | 80,347 | ||||||||||
Less valuation allowance | (102,949 | ) | (80,347 | ) | ||||||||
Net deferred tax assets | $ | — | $ | — | ||||||||
Summarized_Quarterly_Data_Unau1
Summarized Quarterly Data (Unaudited) (Tables) | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | |||||||||||||||
Schedule of Quarterly Financial Information | ' | |||||||||||||||
Summarized quarterly data for the years ended December 31, 2013 and 2012 is as follows: | ||||||||||||||||
2013 Quarter Ended | ||||||||||||||||
March 31, | June 30, | September 30, | December 31, | |||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||
Revenue | $ | 6,981 | $ | 8,942 | $ | 7,168 | $ | 9,921 | ||||||||
Cost of Sales | $ | 4,158 | $ | 4,630 | $ | 5,354 | $ | 7,099 | ||||||||
Gross Profit (1) | $ | 2,823 | $ | 4,312 | $ | 1,814 | $ | 2,822 | ||||||||
Net loss | $ | (21,055 | ) | $ | (13,332 | ) | $ | (10,852 | ) | $ | (35,617 | ) | ||||
Net loss per share, basic and diluted | $ | (0.21 | ) | $ | (0.13 | ) | $ | (0.10 | ) | $ | (0.28 | ) | ||||
Weighted-average shares outstanding, basic and diluted | 100,809 | 100,876 | 104,682 | 127,869 | ||||||||||||
2012 Quarter Ended | ||||||||||||||||
March 31, | June 30, | September 30, | December 31, | |||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||
Revenue | $ | 18,347 | $ | 8,030 | $ | 8,453 | $ | 9,496 | ||||||||
Cost of Sales | $ | 5,062 | $ | 4,167 | $ | 4,249 | $ | 6,018 | ||||||||
Gross Profit (1) | $ | 13,285 | $ | 3,863 | $ | 4,204 | $ | 3,478 | ||||||||
Net loss | $ | (10,292 | ) | $ | (17,169 | ) | $ | (19,282 | ) | $ | (643 | ) | ||||
Net loss per share, basic and diluted | $ | (0.16 | ) | $ | (0.26 | ) | $ | (0.21 | ) | $ | (0.01 | ) | ||||
Weighted-average shares outstanding, basic and diluted | 65,369 | 65,449 | 90,370 | 100,714 | ||||||||||||
(1) Gross Profit is calculated as Total Revenues less Cost of Sales. |
Organization_and_Basis_of_Pres1
Organization and Basis of Presentation - Narrative (Detail) (USD $) | 0 Months Ended | 12 Months Ended | |||
Nov. 12, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Mar. 27, 2013 | |
Disclosure Organization And Basis Of Presentation Additional Information [Abstract] | ' | ' | ' | ' | ' |
Common Stock, Value, Authorized | ' | ' | ' | ' | $25,000,000 |
Common Stock, Shares, Issued | ' | 6,753,104 | ' | ' | ' |
Sale of Stock, Price Per Share | ' | $1.66 | ' | ' | ' |
Issuance of common stock from initial public offering | ' | 10,834,000 | ' | ' | ' |
Proceeds from issuance of common stock and common stock warrants, net of issuance costs | 64,471,000 | 75,690,000 | 67,316,000 | 59,527,000 | ' |
Underwriting discounts and commissions paid | 4,140,000 | ' | ' | ' | ' |
Offering expenses | $389,000 | ' | ' | ' | ' |
Sale of shares of common stock | 30,666,667 | ' | ' | ' | ' |
Shares sold from over-allotment option | 4,000,000 | ' | ' | ' | ' |
Purchase price of common stock (in usd per share) | $2.25 | ' | ' | ' | ' |
Summary_of_Significant_Account3
Summary of Significant Accounting Policies - Narrative (Details) (USD $) | 12 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2009 | |
segment | ||||
Accounting Policies [Abstract] | ' | ' | ' | ' |
Letter of credit | ' | ' | ' | $200,000 |
Restricted cash | 200,000 | 200,000 | ' | ' |
Allowance for doubtful accounts | 18,000 | 2,000 | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' |
Advertising expense | 597,000 | 522,000 | 1,180,000 | ' |
Capitalized advertising | 2,000 | 159,000 | ' | ' |
Foreign currency gains (losses) | $95,000 | $68,000 | ($86,000) | ' |
Number of operating segments | 1 | ' | ' | ' |
Pharmaceutical Distributor, Customer One [Member] | Sales Revenue, Product Line [Member] | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' |
Concentration risk | 30.50% | ' | ' | ' |
Pharmaceutical Distributor, Customer Two [Member] | Sales Revenue, Product Line [Member] | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' |
Concentration risk | 30.30% | ' | ' | ' |
Pharmaceutical Distributor, Customer Three [Member] | Sales Revenue, Product Line [Member] | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' |
Concentration risk | 16.60% | ' | ' | ' |
Retail Customer [Member] | Sales Revenue, Product Line [Member] | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' |
Concentration risk | 14.60% | ' | ' | ' |
Retail Customer [Member] | Accounts Receivable [Member] | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' |
Concentration risk | 10.30% | ' | ' | ' |
Pharmaceutical Distributor, Customer One, Two and Three [Member] | Accounts Receivable [Member] | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' |
Concentration risk | 84.90% | ' | ' | ' |
Summary_of_Significant_Account4
Summary of Significant Accounting Policies - Assets and Liabilities Measured at Fair Value on a Recurring Basis (Detail) (USD $) | 12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | ||||||||||||||||||
Maximum [Member] | Embedded Derivative Liabilities [Member] | Embedded Derivative Liabilities [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [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] | 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] | ||||||||||||||||||||||
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] | ||||||||||||||||||||||
Assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||
Assets measured at fair value on a recurring basis | ' | ' | ' | ' | ' | ' | ' | $69,120 | [1] | $37,605 | [1] | ' | ' | ' | ' | $0 | [1] | $0 | [1] | ' | ' | ' | ' | $0 | [1] | $0 | [1] | ' | ' | ' | ' | $69,120 | [1] | $37,605 | [1] | ||||||||||
Liabilities | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||
Liabilities measured at fair value on a recurring basis | ' | $233 | $992 | $0 | [2] | $0 | $0 | [3] | $0 | [3] | ' | ' | $0 | [2] | $0 | $0 | [3] | $0 | [3] | ' | ' | $31,341 | [2] | $9,493 | $233 | $992 | ' | ' | $31,341 | [2] | $9,493 | $233 | [3] | $992 | [3] | ' | ' | ||||||||
Volatility rate | 40.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||
[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 sheet. | ||||||||||||||||||||||||||||||||||||||||||||
[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 8) and warrants issued in connection with the Healthcare Royalty financing agreement (see Note 7), 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 and the timing of such event; and for the valuation scenario in which an extraordinary event occurs that is not an all cash transaction or an event whereby a public acquirer would assume the warrants, (b) an expected volatility rate using the Company's historical volatility, supplemented with historical volatility of comparable companies, through the projected date of public announcement of an extraordinary transaction, blended with a 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 derivatives are 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 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 of the liability. Management's revenue projections used in the December 31, 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 liability as of December 31, 2013. |
Summary_of_Significant_Account5
Summary of Significant Accounting Policies - Reconciliation of Liabilities Measured at Fair Value Using Significant Observable Inputs (Level 3) (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Warrants and Rights Outstanding [Member] | ' | ' |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ' | ' |
Beginning Balance | $9,493 | $345 |
Issuance | ' | 20,959 |
Exercises | -79 | ' |
Changes in fair value | 21,927 | -11,811 |
Ending Balance | 31,341 | 9,493 |
Embedded Derivative Liabilities [Member] | ' | ' |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ' | ' |
Beginning Balance | 992 | 845 |
Issuance | ' | 0 |
Exercises | 0 | ' |
Changes in fair value | -759 | 147 |
Ending Balance | $233 | $992 |
Summary_of_Significant_Account6
Summary of Significant Accounting Policies - Property and Equipment, Net Narrative (Details) | 12 Months Ended |
Dec. 31, 2013 | |
Computer equipment and software [Member] | Minimum [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property and equipment, useful life | '3 years |
Furniture and fixtures [Member] | Minimum [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property and equipment, useful life | '3 years |
Furniture and fixtures [Member] | Maximum [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property and equipment, useful life | '7 years |
Manufacturing equipment and tooling [Member] | Minimum [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property and equipment, useful life | '3 years |
Manufacturing equipment and tooling [Member] | Maximum [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property and equipment, useful life | '15 years |
Summary_of_Significant_Account7
Summary of Significant Accounting Policies - Revenue Recognition Narrative (Details) (USD $) | 3 Months Ended | 12 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2013 |
Revenue from External Customer [Line Items] | ' | ' | ' |
Increase in product returns estimate | $2,408 | $1,226 | ' |
Change in estimate, effect on earnings per share | ' | ' | $0.03 |
Sales revenue, discount rate | ' | ' | 2.00% |
Sumavel DosePro [Member] | ' | ' | ' |
Revenue from External Customer [Line Items] | ' | ' | ' |
Product shelf life | ' | ' | '30 months |
Sumavel DosePro [Member] | Period Prior to Expiration [Member] | ' | ' | ' |
Revenue from External Customer [Line Items] | ' | ' | ' |
Period to accept returned unused product | ' | ' | '6 months |
Sumavel DosePro [Member] | Period After Expiration [Member] | ' | ' | ' |
Revenue from External Customer [Line Items] | ' | ' | ' |
Period to accept returned unused product | ' | ' | '1 year |
Summary_of_Significant_Account8
Summary of Significant Accounting Policies - Basic and Diluted Net Loss Per Share (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Numerator | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net loss | ($35,617) | ($10,852) | ($13,332) | ($21,055) | ($643) | ($19,282) | ($17,169) | ($10,292) | ($80,856) | ($47,386) | ($83,903) |
Denominator | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted average common shares outstanding | ' | ' | ' | ' | ' | ' | ' | ' | 108,568 | 80,558 | 42,715 |
Weighted average shares subject to repurchase | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | -3 |
Weighted average shares outstanding, basic and diluted | 127,869 | 104,682 | 100,876 | 100,809 | 100,714 | 90,370 | 65,449 | 65,369 | 108,568 | 80,558 | 42,712 |
Basic and diluted net loss per share | ($0.28) | ($0.10) | ($0.13) | ($0.21) | ($0.01) | ($0.21) | ($0.26) | ($0.16) | ($0.74) | ($0.59) | ($1.96) |
Summary_of_Significant_Account9
Summary of Significant Accounting Policies - Schedule of Calculation of Diluted Net Loss Per Share (Detail) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' |
Anti-dilutive securities excluded from computation of earnings per share amount | 26,708 | 47 | 184 |
Common Stock Options And Restricted Stock Units [Member] | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' |
Anti-dilutive securities excluded from computation of earnings per share amount | 11,027 | 47 | 184 |
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 | 15,681 | 0 | 0 |
Collaboration_License_and_Purc1
Collaboration, License and Purchase Agreements - Narrative (Detail) (USD $) | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Jun. 27, 2013 | Dec. 31, 2013 | Nov. 02, 2012 | Dec. 31, 2013 | Aug. 31, 2012 | Jul. 31, 2009 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jul. 31, 2013 | Dec. 20, 2011 | Jul. 31, 2009 | Jul. 31, 2009 | Dec. 31, 2013 | Feb. 28, 2010 | Aug. 31, 2006 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Mallinckrodt LLC Co-Promotion Agreement [Member] | Mallinckrodt LLC Co-Promotion Agreement [Member] | Valeant Pharmaceuticals North America LLC Co-Promotions Agreement [Member] | Valeant Pharmaceuticals North America LLC Co-Promotions Agreement [Member] | Alkermes Commerical Manufacturing And Supply Agreement [Member] | Alkermes Commerical Manufacturing And Supply 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] | Aradigm Corporation Asset Purchase Agreement [Member] | Aradigm Corporation Asset Purchase Agreement [Member] | Aradigm Corporation Asset Purchase Agreement [Member] | Aradigm Corporation Asset Purchase Agreement [Member] | Aradigm Corporation Asset Purchase Agreement [Member] | Aradigm Corporation Asset Purchase Agreement [Member] | ||||
Minimum [Member] | Maximum [Member] | |||||||||||||||||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Incurred service fee expenses | ' | ' | ' | $1,035,000 | $161,000 | ' | ' | ' | ' | ' | ' | $0 | $1,756,000 | $6,657,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Additional term increments | ' | ' | ' | ' | ' | '12 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Agreement termination notice period | ' | ' | ' | ' | ' | '6 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Agreement termination notice period, net sales contingent | ' | ' | ' | ' | ' | '30 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Agreement termination notice period, change of control contingent | ' | ' | ' | ' | ' | '90 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Service and other revenue | 1,313,000 | 38,000 | 0 | ' | ' | ' | 1,109,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Monthly forecast period | ' | ' | ' | ' | ' | ' | ' | '18 months | '18 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Annual forecast period | ' | ' | ' | ' | ' | ' | ' | '3 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Order period after forecast submission | ' | ' | ' | ' | ' | ' | ' | '4 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage required to purchase | ' | ' | ' | ' | ' | ' | ' | 75.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage to be purchased from supplier | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Non-refundable up-front payment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Milestone payments received | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 18,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Service fee rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 45.00% | 55.00% | ' | ' | ' | ' | ' | ' |
Deferred agreement payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amortizing the upfront and milestone payments as contract revenue recognized | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 8,462,000 | 7,165,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Annual tail payment liability | ' | ' | ' | ' | ' | ' | ' | ' | ' | 742,000 | ' | 1,131,000 | 2,795,000 | ' | ' | 5,291,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Tail Payment Liability, First Payment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 368,000 | 550,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Service fee reduction | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,500,000 | ' | ' | 1,924,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Present value of the service fee receivable and tail payment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,924,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Recognized shared marketing expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 253,000 | 1,663,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Payment to acquire tangible and intangible assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,000,000 | ' | ' | ' |
Milestone payment to acquire tangible and intangible assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,000,000 | ' | ' | ' | ' |
Royalty rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3.00% | ' | ' | 3.00% | ' | ' |
Royalty expense | 1,242,000 | 1,353,000 | 1,205,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,242,000 | 1,353,000 | 1,205,000 |
Expected amortization expense, 2014 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 286,000 | ' | ' | 286,000 | ' | ' |
Expected amortization expense, 2015 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 286,000 | ' | ' | 286,000 | ' | ' |
Expected amortization expense, 2016 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 286,000 | ' | ' | 286,000 | ' | ' |
Expected amortization expense, 2017 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 286,000 | ' | ' | 286,000 | ' | ' |
Expected amortization expense, 2018 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 286,000 | ' | ' | 286,000 | ' | ' |
Expected amortization expense, thereafter | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $2,571,000 | ' | ' | $2,571,000 | ' | ' |
Collaboration_License_and_Purc2
Collaboration, License and Purchase Agreements - Narrative 2 (Details) (USD $) | 0 Months Ended | 12 Months Ended | 1 Months Ended | |||||||
Nov. 03, 2013 | Dec. 31, 2013 | Dec. 31, 2011 | Dec. 31, 2011 | Dec. 31, 2011 | Dec. 31, 2013 | Oct. 31, 2013 | 31-May-12 | Aug. 30, 2011 | Nov. 30, 2007 | |
Altus Formulation Inc. Development and Option Agreement [Member] | Altus Formulation Inc. Development and Option Agreement [Member] | Durect Development and License Agreement [Member] | Durect Development and License Agreement [Member] | Durect Development and License Agreement [Member] | Alkermes License Agreement (formerly Elan Pharma International Limited) [Member] | Alkermes License Agreement (formerly Elan Pharma International Limited) [Member] | Alkermes License Agreement (formerly Elan Pharma International Limited) [Member] | Alkermes License Agreement (formerly Elan Pharma International Limited) [Member] | Alkermes License Agreement (formerly Elan Pharma International Limited) [Member] | |
Minimum [Member] | Research and Development Expense [Member] | Other Assets [Member] | Research and Development Expense [Member] | Research and Development Expense [Member] | Research and Development Expense [Member] | |||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Non Refundable Up Front Fee Payment | $750,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum Additional Payments On Achievement Of Series Of Milestones | ' | 3,500,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Agreement termination notice period | ' | '30 days | ' | ' | ' | '12 months | ' | ' | ' | ' |
Non-refundable up-front payment | ' | ' | ' | ' | 2,250,000 | ' | ' | ' | ' | 500,000 |
Milestone payments made | ' | ' | ' | ' | ' | ' | 2,750,000 | 1,000,000 | 750,000 | ' |
Minimum future milestone payments | ' | ' | 103,000,000 | ' | ' | ' | ' | ' | ' | ' |
Annual external development expense obligation | ' | ' | ' | $1,000,000 | ' | ' | ' | ' | ' | ' |
External development expense obligation period | ' | ' | '12 months | ' | ' | ' | ' | ' | ' | ' |
Royalty agreement term | ' | ' | '15 years | ' | ' | '15 years | ' | ' | ' | ' |
Automatic extension of arrangement term | ' | ' | ' | ' | ' | '3 years | ' | ' | ' | ' |
Collaboration_License_and_Purc3
Collaboration, License and Purchase Agreements - Narrative 3 (Details) (Desitin Arzneimittel GmbH Licensing and Distribution Agreement [Member], USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2012 |
Desitin Arzneimittel GmbH Licensing and Distribution Agreement [Member] | ' |
Revenue Recognition, Distribution Agreements [Line Items] | ' |
Revenue recognized | $397 |
Consolidated_Balance_Sheet_Det2
Consolidated Balance Sheet Details - Inventory, Net (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Balance Sheet Related Disclosures [Abstract] | ' | ' |
Raw materials | $2,770 | $4,867 |
Work in process | 6,054 | 6,134 |
Finished goods | 1,112 | 1,885 |
Inventory, net | $9,936 | $12,886 |
Consolidated_Balance_Sheet_Det3
Consolidated Balance Sheet Details - Property and Equipment, Net (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Property and equipment | $21,063 | $19,822 | ' |
Less accumulated depreciation | -8,052 | -6,261 | ' |
Property and equipment, net | 13,011 | 13,561 | ' |
Depreciation | 1,806 | 1,599 | 1,584 |
Machinery, equipment and tooling [Member] | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Property and equipment | 12,479 | 12,325 | ' |
Construction in progress [Member] | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Property and equipment | 6,222 | 5,068 | ' |
Computer equipment and software [Member] | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Property and equipment | 951 | 961 | ' |
Leasehold improvements [Member] | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Property and equipment | 783 | 783 | ' |
Furniture and fixtures [Member] | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Property and equipment | $628 | $685 | ' |
Consolidated_Balance_Sheet_Det4
Consolidated Balance Sheet Details - Other Assets (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Debt acquisition costs | $969 | $1,217 |
Deposits | 431 | 840 |
Restricted cash | 200 | 200 |
Other assets | 125 | 0 |
Total other assets | 6,614 | 5,400 |
Aradigm [Member] | ' | ' |
Prepaid royalty expense | 2,571 | 3,143 |
Alkermes [Member] | ' | ' |
Prepaid royalty expense | $2,318 | $0 |
Consolidated_Balance_Sheet_Det5
Consolidated Balance Sheet Details - Accrued Expenses (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Balance Sheet Related Disclosures [Abstract] | ' | ' |
Accrued product returns | $5,445 | $3,034 |
Accrued discounts and allowances | 4,239 | 4,088 |
Accrued interest expense, current portion | 3,033 | 2,526 |
Accrued clinical trial costs | 1,238 | 1,012 |
Accrued sales and marketing costs | 1,161 | 304 |
Astellas tail payment, current portion | 1,131 | 1,820 |
Other accrued expenses | 2,618 | 1,559 |
Accrued expenses | $18,865 | $14,343 |
Consolidated_Balance_Sheet_Det6
Consolidated Balance Sheet Details - Other Long-Term Liabilities (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Statement of Financial Position [Abstract] | ' | ' |
Interest expense payable, less current portion | $5,901 | $2,607 |
Deferred Rent | 77 | 214 |
Embedded derivatives | 233 | 992 |
Astellas tail payment, less current portion | 0 | 975 |
Other long-term liabilities | 285 | 290 |
Total other long-term liabilities | $6,496 | $5,078 |
Restructuring_Narrative_Detail
Restructuring - Narrative (Details) (USD $) | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | 31-May-13 | Jun. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
employee | |||||
Restructuring and Related Activities [Abstract] | ' | ' | ' | ' | ' |
Number of positions eliminated | 55 | ' | ' | ' | ' |
Restructuring | ' | $876 | $876 | $0 | $0 |
Restructuring_Schedule_of_Rest
Restructuring - Schedule of Restructuring Charges (Details) (USD $) | 3 Months Ended | 12 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2013 | Dec. 31, 2013 | Sep. 30, 2013 | Dec. 31, 2013 |
Employee-related charges [Member] | Employee-related charges [Member] | Other restructuring charges [Member] | Other restructuring charges [Member] | |||||
Restructuring Cost and Reserve [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Accruals | ' | $675 | ' | ' | $663 | ' | $12 | ' |
Non-cash items | ' | 201 | ' | ' | 201 | ' | 0 | ' |
Total | $876 | $876 | $0 | $0 | ' | $864 | ' | $12 |
Restructuring_Restructuring_Re
Restructuring - Restructuring Reserve (Details) (USD $) | 9 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Dec. 31, 2013 |
Restructuring Reserve [Roll Forward] | ' | ' |
Restructuring reserve, beginning balance | $0 | $0 |
Accruals | ' | 675 |
Payments | ' | -671 |
Restructuring reserve, ending balance | ' | 4 |
Employee severance costs [Member] | ' | ' |
Restructuring Reserve [Roll Forward] | ' | ' |
Restructuring reserve, beginning balance | 0 | 0 |
Accruals | 663 | ' |
Payments | ' | -659 |
Restructuring reserve, ending balance | ' | 4 |
Other restructuring charges [Member] | ' | ' |
Restructuring Reserve [Roll Forward] | ' | ' |
Restructuring reserve, beginning balance | 0 | 0 |
Accruals | 12 | ' |
Payments | 12 | ' |
Restructuring reserve, ending balance | ' | $0 |
Commitments_Narrative_Details
Commitments - Narrative (Details) | 2 Months Ended | 10 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 1 Months Ended | ||||||
Dec. 31, 2013 | Dec. 31, 2013 | Oct. 31, 2013 | Oct. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Apr. 23, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Aug. 31, 2009 | |
USD ($) | GBP (£) | USD ($) | GBP (£) | USD ($) | GBP (£) | USD ($) | USD ($) | Building [Member] | Building [Member] | Building [Member] | Vehicles [Member] | |
San Diego [Member] | San Diego [Member] | Emeryville [Member] | USD ($) | |||||||||
USD ($) | ||||||||||||
Operating Leased Assets [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Base rent percent increase | ' | ' | ' | ' | ' | ' | ' | ' | 3.00% | ' | 3.00% | ' |
Period uncharged | ' | ' | ' | ' | ' | ' | ' | ' | ' | '3 months | '2 months | ' |
Improvement allowance | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $305,000 | ' |
Term of lease per vehicle | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '36 months |
Lessor required letter of credit | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 200,000 |
Rent expense | ' | ' | ' | ' | 829,000 | ' | 828,000 | 826,000 | ' | ' | ' | ' |
Non-cancellable purchase orders outstanding | 3,246,000 | ' | ' | ' | 3,246,000 | ' | ' | ' | ' | ' | ' | ' |
Non-cancellable purchase orders | 5,218,000 | ' | ' | ' | 5,218,000 | ' | ' | ' | ' | ' | ' | ' |
Monthly manufacturing fee | 674,000 | 409,000 | 513,000 | 311,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Manufacturing fee, total | ' | ' | ' | ' | $18,882,000 | £ 11,452,000 | ' | ' | ' | ' | ' | ' |
Commitments_Future_Minimum_Lea
Commitments - Future Minimum Lease Payments (Details) (USD $) | Dec. 31, 2013 |
In Thousands, unless otherwise specified | |
Commitments and Contingencies Disclosure [Abstract] | ' |
2014 | $1,330 |
2015 | 693 |
2016 | 43 |
2017 and thereafter | 0 |
Total | $2,066 |
Debt_Schedule_of_Maturities_of
Debt - Schedule of Maturities of Long-term Debt (Details) (USD $) | Dec. 31, 2013 |
In Thousands, unless otherwise specified | |
Debt Disclosure [Abstract] | ' |
2014 | $3,033 |
2015 | 15,930 |
2016 | 17,259 |
2017 | 16,668 |
2018 | 4,159 |
Total minimum payments | 57,049 |
Less amount representing interest | -27,049 |
Total long-term debt | 30,000 |
Less current portion | 0 |
Long-term portion | $30,000 |
Debt_Healthcare_Royalty_Financ
Debt - Healthcare Royalty Financing Agreement Narrative (Details) (USD $) | 0 Months Ended | 12 Months Ended | ||||
Jul. 27, 2012 | Jul. 18, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jul. 31, 2012 | |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' |
Long-term debt interest expense | ' | ' | $5,672,000 | $6,708,000 | $5,562,000 | ' |
Common stock issued and sold to Healthcare Royalty, amount | ' | ' | 139,000 | 101,000 | ' | ' |
Common stock issued and sold to Healthcare Royalty, shares | ' | ' | 138,927,000 | 100,809,000 | ' | ' |
Common stock issued and sold to Healthcare Royalty, (usd per share) | ' | ' | $1.66 | ' | ' | ' |
Warrant exercisable to Healthcare Royalty, shares | ' | 225,000 | ' | ' | ' | ' |
Warrant exercisable to Healthcare Royalty, (usd per share) | ' | $9 | ' | ' | ' | ' |
Period For Warrant Term | '5 years | '10 years | ' | ' | ' | ' |
Long-term Debt | ' | ' | ' | ' | ' | 25,000,000 |
Change in fair value of embedded derivatives | ' | ' | 759,000 | -147,000 | -240,000 | ' |
Embedded Derivative Liabilities [Member] | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' |
Fair value of embedded derivatives | ' | ' | 233,000 | 992,000 | ' | ' |
Change in fair value | ' | ' | -759,000 | 147,000 | ' | ' |
Healthcare Royalty Financing Agreement [Member] | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' |
Company closed royalty financing agreement | ' | 18-Jul-11 | ' | ' | ' | ' |
Debt instrument, outstanding | ' | 30,000,000 | ' | ' | ' | ' |
Common stock issued and sold to Healthcare Royalty, amount | ' | 1,500,000 | ' | ' | ' | ' |
Common stock issued and sold to Healthcare Royalty, shares | ' | 388,601 | ' | ' | ' | ' |
Common stock issued and sold to Healthcare Royalty, (usd per share) | ' | $3.86 | ' | ' | ' | ' |
Revenue interest rate | ' | 0.50% | ' | ' | ' | ' |
Net product sales amount received | ' | 10,000,000 | ' | ' | ' | ' |
Number of fixed payments | ' | 3 | ' | ' | ' | ' |
Fixed payment for Jan 31, 2015 | ' | 10,000,000 | ' | ' | ' | ' |
Fixed payment for Jan 31, 2016 | ' | ' | 10,000,000 | ' | ' | ' |
Fixed payment for Jan 31, 2017 | ' | ' | 10,000,000 | ' | ' | ' |
Fixed debt repayment dates | ' | 'January 31, 2015, January 31, 2016 and January 31, 2017 | ' | ' | ' | ' |
Terminate payment base amount | ' | ' | 75,000,000 | ' | ' | ' |
Change in fair value | ' | ' | ' | ' | 417,000 | ' |
Aggregate net proceed from financing agreement | ' | 29,485,000 | ' | ' | ' | ' |
Financing discounts | ' | 476,000 | ' | ' | ' | ' |
Healthcare Royalty Financing Agreement [Member] | Embedded Derivative Liabilities [Member] | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' |
Financing discounts | ' | 605,000 | ' | ' | ' | ' |
Healthcare Royalty Financing Agreement [Member] | Common Stock Warrant Liabilities [Member] | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' |
Change in fair value | ' | ' | -307,000 | 160,000 | ' | ' |
Financing discounts | ' | 790,000 | ' | ' | ' | ' |
Healthcare Royalty Financing Agreement [Member] | Scenario 1[Member] | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' |
Net product sales amount received | ' | 75,000,000 | ' | ' | ' | ' |
Terminate payment base amount | ' | ' | 52,500,000 | ' | ' | ' |
Borrowed internal rate of return | ' | ' | 19.00% | ' | ' | ' |
Healthcare Royalty Financing Agreement [Member] | Scenario 1[Member] | Minimum [Member] | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' |
Revenue interest rate | ' | 5.00% | ' | ' | ' | ' |
Healthcare Royalty Financing Agreement [Member] | Scenario 1[Member] | Maximum [Member] | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' |
Revenue interest rate | ' | 5.75% | ' | ' | ' | ' |
Healthcare Royalty Financing Agreement [Member] | Scenario 2[Member] | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' |
Revenue interest rate | ' | 2.50% | ' | ' | ' | ' |
Net product sales amount received | ' | 75,000,000 | ' | ' | ' | ' |
Terminate payment base amount | ' | ' | 45,000,000 | ' | ' | ' |
Borrowed internal rate of return | ' | ' | 17.00% | ' | ' | ' |
Healthcare Royalty Financing Agreement [Member] | Scenario 3[Member] | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' |
Revenue interest rate | ' | 0.50% | ' | ' | ' | ' |
Net product sales amount received | ' | $150,000,000 | ' | ' | ' | ' |
Debt_Term_Debt_Narrative_Detai
Debt - Term Debt Narrative (Details) (USD $) | 0 Months Ended | 0 Months Ended | 1 Months Ended | 0 Months Ended | 1 Months Ended | ||||||||
Jul. 27, 2012 | Jul. 18, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Jul. 31, 2012 | Dec. 31, 2009 | Jul. 30, 2012 | Jun. 30, 2011 | Dec. 31, 2011 | Jul. 30, 2012 | Jun. 30, 2008 | Jun. 30, 2011 | Jun. 30, 2011 | |
Oxford/SVB [Member] | Oxford/SVB [Member] | Oxford/SVB [Member] | Oxford/SVB [Member] | Oxford/SVB [Member] | Minimum [Member] | Maximum [Member] | |||||||
Revolving Credit Facility [Member] | Loan And Security Agreement [Member] | Oxford/SVB [Member] | Oxford/SVB [Member] | ||||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt instrument, outstanding | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $18,000,000 | ' | ' |
Warrant exercisable to Healthcare Royalty, shares | ' | 225,000 | ' | ' | ' | ' | ' | 26,455 | ' | ' | ' | ' | ' |
Warrants exercise price (in usd per share) | $2.50 | ' | ' | ' | ' | ' | ' | $3.78 | ' | ' | ' | ' | ' |
Term of common stock warrant exercisable | '5 years | '10 years | ' | ' | ' | ' | ' | '7 years | ' | ' | ' | ' | ' |
Debt discount | ' | ' | ' | ' | ' | ' | ' | ' | 76,000 | ' | ' | ' | ' |
Fair value of warrant liabilities | ' | ' | 30,849,000 | 9,308,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Long term debt under loan and security agreement | ' | ' | ' | ' | 25,000,000 | ' | ' | 25,000,000 | 25,000,000 | ' | ' | ' | ' |
Revolving credit facility | ' | ' | ' | ' | ' | 200,000 | ' | 10,000,000 | ' | ' | ' | ' | ' |
Interest rate | ' | ' | ' | ' | ' | ' | ' | 12.06% | ' | ' | ' | ' | ' |
Revolving credit facility, interest rate description | ' | ' | ' | ' | ' | ' | ' | 'equal to the greater of 3.29% above SVB's prime rate or 7.29% | ' | ' | ' | ' | ' |
Revolving credit facility, interest rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3.29% | 7.29% |
Percentage paid for unused portion of revolving credit facility | ' | ' | ' | ' | ' | ' | ' | 0.50% | ' | ' | ' | ' | ' |
Amount outstanding under revolving credit facility | ' | ' | ' | ' | ' | ' | ' | ' | 5,151,000 | ' | ' | ' | ' |
Principal and interest repaid | ' | ' | ' | ' | ' | ' | 19,492,000 | ' | ' | ' | ' | ' | ' |
Final payment to terminate debt | ' | ' | ' | ' | ' | ' | 1,200,000 | ' | ' | ' | ' | ' | ' |
Percentage of principal as perpayment premium | ' | ' | ' | ' | ' | ' | 2.00% | ' | ' | ' | ' | ' | ' |
Prepayment Premium To Terminate Debt | ' | ' | ' | ' | ' | ' | $400,000 | ' | ' | $100,000 | ' | ' | ' |
Debt_Bridge_Loans_Narrative_De
Debt - Bridge Loans Narrative (Details) (USD $) | 12 Months Ended | |||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Nov. 12, 2013 |
Debt Instrument [Line Items] | ' | ' | ' | ' |
Purchase price of common stock (in usd per share) | ' | ' | ' | $2.25 |
Long-term debt interest expense | $5,672 | $6,708 | $5,562 | ' |
Debt_Equipment_Financing_Narra
Debt - Equipment Financing Narrative (Details) (GE Capital Corporation [Member], Notes Payable, Other Payables [Member], USD $) | 1 Months Ended | |||
Mar. 30, 2007 | Mar. 31, 2007 | Mar. 31, 2007 | Dec. 31, 2007 | |
General Electric Promissory Note One [Member] | General Electric Promissory Note Two [Member] | |||
Debt Instrument [Line Items] | ' | ' | ' | ' |
Debt instrument, outstanding | ' | $10,000,000 | ' | ' |
Debt instrument, outstanding | ' | ' | $3,500,000 | $1,000,000 |
Repayment period | '48 months | ' | ' | ' |
Interest rate | ' | ' | 10.08% | 9.91% |
Preferred_Stock_and_Stockholde2
Preferred Stock and Stockholders' Equity - Preferred Stock and Common Stock Narrative (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Class of Stock [Line Items] | ' | ' |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, par value (in usd per share) | $0.00 | $0.00 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, par value (in usd per share) | $0.00 | $0.00 |
Preferred_Stock_and_Stockholde3
Preferred Stock and Stockholders' Equity - Summary of Common Stock Reserved for Future Issuance (Details) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Class of Stock [Line Items] | ' | ' |
Common stock, shares reserved for future issuance | 33,643 | 27,359 |
Warrant [Member] | ' | ' |
Class of Stock [Line Items] | ' | ' |
Common stock, shares reserved for future issuance | 16,189 | 16,292 |
Stock Options [Member] | ' | ' |
Class of Stock [Line Items] | ' | ' |
Common stock, shares reserved for future issuance | 14,859 | 9,901 |
Employee Stock [Member] | ' | ' |
Class of Stock [Line Items] | ' | ' |
Common stock, shares reserved for future issuance | 2,595 | 1,166 |
Preferred_Stock_and_Stockholde4
Preferred Stock and Stockholders' Equity - Common Stock Warrants Narrative (Detail) (USD $) | 0 Months Ended | 1 Months Ended | ||||||
In Thousands, except Share data, unless otherwise specified | Jul. 27, 2012 | Jul. 18, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Jun. 30, 2011 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 |
Oxford/SVB [Member] | Oxford/SVB [Member] | Cowen Royalty [Member] | Cowen Royalty [Member] | |||||
Schedule Of Common Stock [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Shares of common stock exercisable through warrants | 15,784,200 | ' | ' | ' | 26,455 | ' | ' | ' |
Warrants exercise price (in usd per share) | $2.50 | ' | ' | ' | $3.78 | ' | ' | ' |
Warrants expiry date | 'July 27, 2017 | ' | ' | ' | ' | ' | ' | ' |
Term of common stock warrant exercisable | '5 years | '10 years | ' | ' | '7 years | ' | ' | ' |
Fair value of warrant liabilities | ' | ' | $30,849 | $9,308 | ' | ' | $492 | $185 |
Warrant exercisable to Healthcare Royalty, shares | ' | 225,000 | ' | ' | 26,455 | ' | ' | ' |
Investment Warrants, Exercise Price | ' | $9 | ' | ' | ' | ' | ' | ' |
Debt discount | ' | ' | ' | ' | ' | $76 | ' | ' |
Preferred_Stock_and_Stockholde5
Preferred Stock and Stockholders' Equity - Convertible Preferred Stock Warrants (Details) | 1 Months Ended | |||
Jul. 31, 2010 | Jul. 31, 2010 | Jul. 31, 2010 | Nov. 29, 2010 | |
Oxford [Member] | Silicon Valley Bank [Member] | Oxford/SVB [Member] | Oxford/SVB [Member] | |
Series B Preferred Stock [Member] | Series B Preferred Stock [Member] | Series B Preferred Stock [Member] | Common Stock [Member] | |
Class of Stock [Line Items] | ' | ' | ' | ' |
Conversion of convertible preferred stock to common stock at initial public offering, shares | 1,145,455 | 445,455 | ' | ' |
Exercise price | ' | ' | 1.1 | 11 |
Sale of warrants to purchase common stock | ' | ' | ' | 159,090 |
StockBased_Compensation_Narrat
Stock-Based Compensation - Narrative (Detail) (USD $) | 12 Months Ended | 12 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2006 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Nov. 29, 2010 | Dec. 31, 2013 | Dec. 31, 2013 | Jun. 30, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Nov. 30, 2013 | 31-May-13 | Nov. 30, 2012 | 31-May-12 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | |
Consultants [Member] | Stock Options [Member] | Restricted Stock Units (RSUs) [Member] | Restricted Stock Units (RSUs) [Member] | 2006 Plan [Member] | 2006 Plan [Member] | 2006 Plan [Member] | 2006 Plan [Member] | 2006 Plan [Member] | 2006 Plan [Member] | 2010 Plan [Member] | 2010 Plan [Member] | 2010 Plan [Member] | 2010 Plan [Member] | Restated 2010 Plan [Member] | Restated 2010 Plan [Member] | Restated 2010 Plan [Member] | Inducement Plan [Member] | Purchase Plan [Member] | Purchase Plan [Member] | Purchase Plan [Member] | Purchase Plan [Member] | Purchase Plan [Member] | Purchase Plan [Member] | Purchase Plan [Member] | ||||
Consultants [Member] | Monthly Vesting Period [Member] | Stock Options [Member] | Stock Options [Member] | Monthly Vesting Period [Member] | Annual Vesting Period [Member] | Employee Stock [Member] | Employee Stock [Member] | Employee Stock [Member] | Employee Stock [Member] | Employee Stock [Member] | Employee Stock [Member] | Employee Stock [Member] | ||||||||||||||||
Annual Vesting Period [Member] | Purchase_Period | Maximum [Member] | ||||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares of common stock reserved | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,134,000 | ' | ' | ' | ' | 2,243,668 | ' | ' | 9,300,000 | ' | ' | 2,700,000 | ' | ' | ' | ' | 409,646 | 463,973 | ' |
Expected term | ' | ' | ' | ' | ' | ' | ' | '10 years | ' | ' | ' | ' | ' | '10 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Vesting term | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '4 years | ' | '4 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Vesting rights percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.08% | ' | 25.00% | ' | ' | 2.08% | 25.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percent of additional shares authorized provision | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum amount deductible | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1,000,000 | ' | ' | ' | ' | ' | ' | ' |
Shares available for future issuance | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 456,854 | 701,976 | 1,728,000 | ' | ' | ' | ' | ' | ' | ' |
Shares outstanding | ' | ' | ' | ' | ' | 1,331,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted average remaining contractual term | ' | ' | ' | ' | ' | '4 months 24 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Aggregate intrinsic value | ' | ' | ' | ' | ' | 4,577,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unvested shares expected to vest | ' | ' | ' | ' | ' | 1,301,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock price (in usd per share) | $3.44 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of purchase price | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 85.00% | ' | ' |
Maximum percentage of employee withholding | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20.00% | ' | ' |
Maximum number of shares per employee | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20,000 | ' | ' |
Offering period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '6 months | ' | '27 months |
Number of purchase periods | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' |
Exercised (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 99,024 | 205,303 | 138,826 | 225,053 | ' | ' | ' |
Weighted average fair value of options outstanding (in usd per share) | $2.46 | $2.64 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total unrecognized compensation costs | ' | ' | ' | ' | 12,647,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Recognition over weighted average periods | ' | ' | ' | '3 years 3 months 18 days | '2 years 8 months 24 days | ' | '4 months 24 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unvested stock options outstanding (in shares) | ' | ' | ' | 182,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unvested restricted stock outstanding (in shares) | ' | ' | ' | ' | ' | ' | 25,000 | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unrecognized compensation expense | ' | ' | ' | 574,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock-based compensation | $8,006,000 | $6,157,000 | $4,809,000 | $323,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
StockBased_Compensation_Schedu
Stock-Based Compensation - Schedule of Stock-Based Compensation Activity (Details) (USD $) | 12 Months Ended |
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ' |
Outstanding beginning balance (in shares) | 9,901 |
Granted (in shares) | 5,257 |
Exercised (in shares) | -291 |
Canceled/Forfeited (in shares) | -1,338 |
Outstanding ending balance (in shares) | 13,529 |
Exercisable at December 31, 2013 (in shares) | 5,617 |
Vested at December 31, 2013 (in shares) | 12,997 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward] | ' |
Outstanding weighted average exercise price, beginning balance (in usd per share) | $2.64 |
Granted weighted average exercise price (in usd per share) | $2.16 |
Exercised weighted average exercise price (in usd per share) | $1.97 |
Canceled/Forfeited weighted average exercise price (in usd per share) | $2.70 |
Outstanding weighted average exercise price, ending balance (in usd per share) | $2.46 |
Exercisable weighted average exercise price at December 31, 2013 (in usd per share) | $2.73 |
Vested and unvested expected to vest weighted average exercise price at December 31, 2013 (in usd per share) | $2.47 |
Outstanding, weighted average remaining term at December 31, 2013 | '8 years 3 months 18 days |
Exercisable, weighted average remaining term at December 31, 2013 | '7 years 7 months 6 days |
Vested and unvested expected to vest, weighted average remaining term at December 31, 2013 | '8 years 3 months 18 days |
Outstanding, intrinsic value at December 31, 2013 | $15,266 |
Exercisable, intrinsic value at December 31, 2013 | 5,484 |
Vested and unvested expected to vest, intrinsic value at December 31, 2013 | $14,622 |
StockBased_Compensation_Schedu1
Stock-Based Compensation - Schedule of Share-based Compensation, Additional Information (Details) (Stock Options and Restricted Stock Units [Member], USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Stock Options and Restricted Stock Units [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Weighted-average grant date fair value (in usd per share) | $1.58 | $1.35 | $2.88 |
Aggregate intrinsic value of options exercised | $370,000 | $9,000 | $226,000 |
Total fair value of shares vested | $4,895,000 | $3,564,000 | $2,340,000 |
StockBased_Compensation_Assump
Stock-Based Compensation - Assumptions used in Black-Scholes Option-Pricing Model (Detail) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Stock Options [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Risk free interest rate, minimum | 0.80% | 0.20% | 1.20% |
Risk free interest rate, maximum | 1.80% | 1.20% | 2.60% |
Expected volatility, minimum | 82.80% | 80.10% | 72.30% |
Expected volatility, maximum | 87.90% | 86.80% | 89.70% |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Stock Options [Member] | Minimum [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Expected term | '5 years | '5 years | '5 years 1 month 6 days |
Stock Options [Member] | Maximum [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Expected term | '6 years 1 month 6 days | '6 years 1 month 6 days | '6 years 1 month 6 days |
Employee Stock [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Risk free interest rate, minimum | 0.10% | 0.10% | 0.10% |
Expected volatility, minimum | 74.30% | 81.50% | 75.20% |
Expected volatility, maximum | 125.60% | 85.70% | 77.10% |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Employee Stock [Member] | Minimum [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Expected term | '6 months | '6 months | '6 months |
Employee Stock [Member] | Maximum [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Expected term | '1 year | '1 year | '1 year |
StockBased_Compensation_StockB
Stock-Based Compensation - Stock-Based Compensation Expense (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Stock-based compensation expense | $8,006 | $6,157 | $4,809 |
Cost of Sales [Member] | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Stock-based compensation expense | 333 | 181 | 137 |
Research and Development [Member] | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Stock-based compensation expense | 1,138 | 921 | 768 |
Selling, General and Administrative [Member] | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Stock-based compensation expense | $6,535 | $5,055 | $3,904 |
Employee_Benefit_Plan_Details
Employee Benefit Plan (Details) | 0 Months Ended |
Feb. 02, 2007 | |
Postemployment Benefits [Abstract] | ' |
Postemployment benefit, attained age | '21 years |
Income_Taxes_Narrative_Details
Income Taxes - Narrative (Details) (USD $) | 12 Months Ended | 65 Months Ended | 12 Months Ended | 12 Months Ended | ||||
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2010 | Aug. 31, 2006 | Dec. 31, 2013 | Dec. 31, 2010 |
ownership | Internal Revenue Service (IRS) [Member] | Internal Revenue Service (IRS) [Member] | Internal Revenue Service (IRS) [Member] | State and Local Jurisdiction [Member] | State and Local Jurisdiction [Member] | |||
Operating Loss Carryforwards [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Unrecognized tax benefits | $714 | $678 | $899 | ' | ' | ' | ' | ' |
Net operating losses | ' | ' | ' | 208,131 | ' | ' | 202,100 | ' |
Operating loss carryforwards, expiration dates | ' | ' | ' | '2026 | ' | ' | '2015 | ' |
Number of changes in ownership | ' | 2 | ' | ' | ' | ' | ' | ' |
Operating loss carryforwards decrease | ' | ' | ' | ' | 83,503 | 1,900 | ' | 46,243 |
Valuation allowance | 80,347 | ' | 102,949 | ' | ' | ' | ' | ' |
Expense (benefit) from foreign income tax expense | 5 | ' | ' | ' | ' | ' | ' | ' |
Total deferred tax assets | $80,347 | ' | $102,949 | ' | ' | ' | ' | ' |
Income_Taxes_Schedule_of_Unrec
Income Taxes - Schedule of Unrecognized Tax Benefits (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ' | ' |
Beginning balance of unrecognized tax benefits | $714 | $678 |
Gross increases based on tax positions related to current year | 185 | 36 |
Gross increases based on tax positions related to prior year | 0 | 0 |
Settlements with taxing authorities | 0 | 0 |
Expiration of statue of limitations | 0 | 0 |
Ending balance of unrecognized tax benefits | $899 | $714 |
Income_Taxes_Tax_Credit_Carryf
Income Taxes - Tax Credit Carryforward Narrative (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2010 | Aug. 31, 2006 |
Internal Revenue Service (IRS) [Member] | ' | ' | ' |
Tax Credit Carryforward [Line Items] | ' | ' | ' |
Tax credit carryforward, amount | $1,088 | ' | ' |
Tax credit carryforwards, decrease | ' | -2,203 | -8 |
Tax credit carryforward, expiration date | 1-Jan-26 | ' | ' |
State and Local Jurisdiction [Member] | ' | ' | ' |
Tax Credit Carryforward [Line Items] | ' | ' | ' |
Tax credit carryforward, amount | $2,217 | ' | ' |
Income_Taxes_Reconciliation_of
Income Taxes - Reconciliation of Income Tax to Expense (Benefit) (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Income Tax Disclosure [Abstract] | ' | ' | ' |
Tax at statutory rate | ($27,491) | ($16,109) | ($28,530) |
State taxes, net of federal benefit | -1,821 | -1,580 | -2,780 |
Change in valuation allowance | 22,602 | 21,990 | -16,807 |
Section 382 limitation | 0 | 0 | 45,728 |
Permanent interest disallowed | 7,197 | -4,466 | -70 |
Credits and other | -487 | 170 | 2,450 |
Provision for income tax benefit (expense) | $0 | $5 | ($9) |
Income_Taxes_Schedule_of_Defer
Income Taxes - Schedule of Deferred Tax Assets (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Income Tax Disclosure [Abstract] | ' | ' |
Net operating losses | $80,388 | $61,739 |
Capitalized research and development | 8,172 | 8,903 |
Accrued expenses | 3,263 | 3,707 |
Research and development credits | 2,010 | 1,237 |
Accrued product returns | 2,029 | 1,087 |
Inventory reserve and UNICAP | 660 | 688 |
Depreciation and amortization | 1,691 | 645 |
Other, net | 4,736 | 2,341 |
Total deferred tax assets | 102,949 | 80,347 |
Less valuation allowance | -102,949 | -80,347 |
Net deferred tax assets | $0 | $0 |
Summarized_Quarterly_Data_Unau2
Summarized Quarterly Data (Unaudited) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Quarterly Financial Information Disclosure [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues | $9,921 | $7,168 | $8,942 | $6,981 | $9,496 | $8,453 | $8,030 | $18,347 | $33,012 | $44,326 | $37,576 |
Cost of sales | 7,099 | 5,354 | 4,630 | 4,158 | 6,018 | 4,249 | 4,167 | 5,062 | 21,241 | 19,496 | 19,293 |
Gross profit | 2,822 | 1,814 | 4,312 | 2,823 | 3,478 | 4,204 | 3,863 | 13,285 | ' | ' | ' |
Net loss | ($35,617) | ($10,852) | ($13,332) | ($21,055) | ($643) | ($19,282) | ($17,169) | ($10,292) | ($80,856) | ($47,386) | ($83,903) |
Net loss per share, basic and diluted | ($0.28) | ($0.10) | ($0.13) | ($0.21) | ($0.01) | ($0.21) | ($0.26) | ($0.16) | ($0.74) | ($0.59) | ($1.96) |
Weighted average shares outstanding, basic and diluted | 127,869 | 104,682 | 100,876 | 100,809 | 100,714 | 90,370 | 65,449 | 65,369 | 108,568 | 80,558 | 42,712 |