Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Oct. 31, 2018 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | ZGNX | |
Entity Registrant Name | ZOGENIX, INC. | |
Entity Central Index Key | 1,375,151 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 41,968,019 | |
Entity Small Business | false | |
Entity Emerging Growth Company | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 163,038 | $ 293,503 |
Marketable securities | 376,087 | 0 |
Prepaid expenses | 6,861 | 5,994 |
Other current assets | 1,286 | 5,206 |
Total current assets | 547,272 | 304,703 |
Property and equipment, net | 244 | 245 |
Intangible assets | 102,500 | 102,500 |
Goodwill | 6,234 | 6,234 |
Other assets | 3,380 | 3,931 |
Total assets | 659,630 | 417,613 |
Current liabilities: | ||
Accounts payable | 4,110 | 3,356 |
Accrued clinical trial expenses | 10,674 | 8,657 |
Accrued compensation | 5,039 | 6,616 |
Other accrued liabilities | 2,413 | 1,842 |
Current portion of contingent consideration | 32,500 | 0 |
Common stock warrant liabilities | 607 | 512 |
Total current liabilities | 55,343 | 20,983 |
Contingent consideration, net of current portion | 47,600 | 76,900 |
Deferred income taxes | 17,425 | 17,425 |
Other long-term liabilities | 482 | 784 |
Total liabilities | 120,850 | 116,092 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Preferred stock, $0.001 par value; 10,000 shares authorized; none issued and outstanding | 0 | 0 |
Common stock, $0.001 par value; 50,000 shares authorized; 35,827 and 34,808 shares issued and outstanding at June 30, 2018 and December 31, 2017, respectively | 42 | 35 |
Additional paid-in capital | 1,212,305 | 873,526 |
Accumulated deficit | (673,521) | (572,040) |
Accumulated other comprehensive loss | (46) | 0 |
Total stockholders’ equity | 538,780 | 301,521 |
Total liabilities and stockholders’ equity | $ 659,630 | $ 417,613 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Sep. 30, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Preferred stock par value (usd per share) | $ 0.001 | $ 0.001 |
Preferred stock authorized (shares) | 10,000,000 | 10,000,000 |
Preferred stock issued (shares) | 0 | 0 |
Preferred stock outstanding (shares) | 0 | 0 |
Common stock par value (usd per share) | $ 0.001 | $ 0.001 |
Common stock authorized (shares) | 50,000,000 | 50,000,000 |
Common stock issued (shares) | 41,925,000 | 34,808,000 |
Common stock outstanding (shares) | 41,925,000 | 34,808,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Revenue: | ||||
Contract manufacturing revenue | $ 0 | $ 0 | $ 0 | $ 9,821 |
Costs and expenses: | ||||
Cost of contract manufacturing | 0 | 0 | 0 | 10,729 |
Research and development | 27,608 | 21,178 | 77,329 | 49,369 |
Selling, general and administrative | 11,016 | 6,073 | 27,663 | 18,129 |
Loss on contract termination | 0 | 478 | 0 | 478 |
Asset impairment charges | 0 | 196 | 0 | 1,116 |
Change in fair value of contingent consideration | 5,700 | 10,500 | 3,200 | 11,600 |
Total costs and expenses | 44,324 | 38,425 | 108,192 | 91,421 |
Loss from operations | (44,324) | (38,425) | (108,192) | (81,600) |
Other income (expense): | ||||
Interest income | 2,133 | 121 | 3,995 | 332 |
Interest expense | 0 | (702) | (6) | (2,065) |
Loss on extinguishment of debt | 0 | (3,378) | 0 | (3,378) |
Change in fair value of common stock warrant liabilities | (64) | (380) | (95) | 360 |
Other (expense) income, net | (9) | 62 | 3,015 | 71 |
Total other income (expense) | 2,060 | (4,277) | 6,909 | (4,680) |
Loss from continuing operations before income taxes | (42,264) | (42,702) | (101,283) | (86,280) |
Income tax benefit | 0 | 42 | 0 | 41 |
Net loss from continuing operations | (42,264) | (42,660) | (101,283) | (86,239) |
Loss from discontinued operations, net of taxes | 0 | (134) | (198) | (870) |
Net loss | $ (42,264) | $ (42,794) | $ (101,481) | $ (87,109) |
Net loss per share, basic and diluted: | ||||
Continuing operations (in dollars per share) | $ (1.08) | $ (1.68) | $ (2.78) | $ (3.45) |
Discontinued operations (in dollars per share) | 0 | 0 | 0 | (0.03) |
Total (in dollars per share) | $ (1.08) | $ (1.68) | $ (2.78) | $ (3.48) |
Weighted average common shares used in the calculation of basic and diluted net loss per common share (shares) | 39,242 | 25,431 | 36,485 | 25,024 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (42,264) | $ (42,794) | $ (101,481) | $ (87,109) |
Other comprehensive income (loss) | ||||
Change in unrealized losses on marketable securities, net of tax | (46) | 0 | (46) | 0 |
Comprehensive loss | $ (42,310) | $ (42,794) | $ (101,527) | $ (87,109) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Operating activities: | ||
Net loss | $ (101,481) | $ (87,109) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Stock-based compensation | 11,952 | 4,066 |
Depreciation and amortization | 76 | 408 |
Amortization of debt issuance costs and debt discount | 0 | 753 |
Net accretion and amortization of investments in marketable securities | (521) | 0 |
Loss on extinguishment of debt | 0 | 3,378 |
Inventory write-down | 0 | 2,232 |
Asset impairment charges | 0 | 1,116 |
Change in fair value of common stock warrant liabilities | 95 | (360) |
Change in fair value of contingent consideration | 3,200 | 11,600 |
Changes in operating assets and liabilities: | ||
Trade accounts receivable | 0 | 9,356 |
Inventory | 0 | 2,583 |
Prepaid expenses and other current assets | 1,429 | 4,996 |
Other assets | 551 | (2,413) |
Accounts payable, accrued and other liabilities | 1,463 | 4,204 |
Deferred revenue | 0 | (1,245) |
Net cash used in operating activities | (83,236) | (46,435) |
Investing activities: | ||
Purchases of marketable securities | (375,612) | 0 |
Purchases of property and equipment | (75) | (35) |
Net cash used in investing activities | (375,687) | (35) |
Financing activities: | ||
Proceeds from issuance of common stock under equity incentive plans | 6,749 | 271 |
Taxes paid related to net share settlement of equity awards | (1,426) | 0 |
Proceeds from issuance of common stock under an at-the-market offering, net of issuance costs | 323,135 | 19,378 |
Net cash provided by financing activities | 328,458 | 19,649 |
Net decrease in cash and cash equivalents | (130,465) | (26,821) |
Cash and cash equivalents, beginning of the period | 293,503 | 91,551 |
Cash and cash equivalents, end of the period | 163,038 | 64,730 |
Noncash financing activities | ||
Extinguishment of Endo working capital advance note payable through net settlement of balances owed to the Company | $ 0 | $ 7,000 |
Organization and Basis of Prese
Organization and Basis of Presentation | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation | Organization and Basis of Presentation Zogenix, Inc., including its wholly-owned subsidiaries (the “Company”), is a pharmaceutical company developing and commercializing innovative central nervous system (“CNS”) therapies for people living with serious and life-threatening rare CNS disorders and medical conditions. The Company’s current primary area of therapeutic focus is rare, or “orphan” childhood-onset epilepsy disorders and its lead product candidate is ZX008. ZX008 is currently being developed for the treatment of seizures associated with Dravet syndrome and Lennox-Gastaut Syndrome. The Company operates in one business segment—the research, development and commercialization of pharmaceutical products and its headquarters are located in Emeryville, California. Basis of Presentation The accompanying condensed consolidated financial statements include the accounts of Zogenix, Inc. and its wholly-owned subsidiaries. Intercompany accounts and transactions have been eliminated in consolidation. The condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial reporting. In the opinion of management, the condensed consolidated financial statements reflect all adjustments, which are normal and recurring in nature, necessary for fair financial statement presentation. Certain reclassifications have been made to the prior period amounts to conform to the current year presentation. “Accrued clinical trial expenses” and “Other accrued liabilities”, which previously were reported as “Accrued expenses” on the condensed consolidated balance sheet, are now reported as separate line items. Additionally, previously reported “Interest expense, net” has been reclassified to present interest income and interest expense separately in the accompanying condensed consolidated statements of operations. The results of operations for any interim period are not necessarily indicative of results of operations for any future period. Certain information and footnote disclosures normally included in annual consolidated financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) have been condensed or omitted. Accordingly, these unaudited interim condensed consolidated financial statements and accompanying notes should be read in conjunction with the consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017, which was filed with the SEC on March 6, 2018. Future Funding Requirements Excluding gains from two discrete business divestitures, the Company has incurred significant net losses and negative cash flows from operating activities since inception resulting in an accumulated deficit of $673.5 million at September 30, 2018. The Company expects to continue to incur significant operating losses and negative cash flows from operations to advance its product candidates through development and commercialization. Additionally, upon acceptance of the Company’s regulatory submissions for ZX008 by the U.S. Food and Drug Administration (“FDA”) or the European Medicines Agency (“EMA”) and regulatory approval of ZX008 by the FDA or EMA, if at all, each a milestone event, the Company will owe milestone payments under an existing agreement in connection with the Company’s prior acquisition of ZX008. To date, the Company has relied primarily on the proceeds from equity offerings to finance its operations. See Note 6 for the Company's recent equity offerings. Until the Company can generate a sufficient amount of revenue to finance its cash requirements, if ever, the Company may need to continue to rely on additional financing to achieve its business objectives. However, if such financing is not available at adequate levels when needed, the Company may be required to significantly delay, scale back or discontinue one or more of the product development programs or commercialization efforts or other aspects of its business plans, and its operating results and financial condition would be adversely affected. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results may differ from those estimates. Significant Accounting Policies There have been no material changes to the Company’s significant accounting policies from those described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017, other than as set forth below. Cash Equivalents and Marketable Securities 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 at the date of purchase. The Company invests its excess cash in marketable securities with high credit ratings that are classified as Level 1 and Level 2 within the fair value hierarchy. These marketable securities consists of money market funds and certificate of deposits, securities issued by the U.S. government and its agencies, corporate debt securities and commercial paper, which are all classified as “available-for-sale”. The Company considers all available-for-sale securities, including those with maturity dates beyond 12 months, as available to support current operational liquidity needs and, therefore, classifies all securities with maturity dates beyond three months at the date of purchase as current assets on the condensed consolidated balance sheets. The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity, which is included in interest income on the condensed consolidated statements of operations and comprehensive loss. Realized gains and losses and declines in value judged to be other-than-temporary, if any, on marketable securities are included in interest income (expense), net. The cost of securities sold is determined using the specific identification method. The Company periodically evaluates whether declines in fair values of its marketable securities below their book value are other-than-temporary. This evaluation consists of several qualitative and quantitative factors regarding the severity and duration of the unrealized loss as well as the Company’s ability and intent to hold the marketable security until a forecasted recovery occurs. Additionally, the Company assesses whether it has plans to sell the security or it is more likely than not it will be required to sell any marketable securities before recovery of its amortized cost basis. Factors considered include quoted market prices, recent financial results and operating trends, implied values from any recent transactions or offers of investee securities, credit quality of debt instrument issuers, other publicly available information that may affect the value of the marketable security, duration and severity of the decline in value, and management’s strategy and intentions for holding the marketable security. To date, the Company has not recorded any impairment charges on its marketable securities related to other-than-temporary declines in market value. Concentration of Credit Risk Cash, cash equivalents and marketable securities are financial instruments that potentially subject the Company to concentration of credit risk. The Company invests its excess cash primarily in money market funds and certificate of deposits, securities issued by the U.S. government and its agencies, corporate debt securities and commercial paper. The Company has established guidelines relative to diversification and maturities to maintain safety and liquidity. The Company has not experienced any credit losses related to these financial instruments and does not believe it is exposed to any significant credit risk related to these instruments. Accounting Pronouncements Recently Adopted Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers (Topic 606) and subsequent amendments to the initial guidance (collectively, “Topic 606”) amended the existing accounting standards for revenue recognition. The core principle of Topic 606 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. The Company adopted Topic 606 effective January 1, 2018 using the modified retrospective approach. The adoption of Topic 606 did not have a material impact on the Company’s condensed consolidated financial statements as the Company does not have any contracts with customers. ASU 2016-15, Statement of Cash Flows (Topic 230) provides guidance on eight specific cash flow issues, thereby reducing the diversity in practice in how certain transactions are classified in the statement of cash flows. The amendments in this ASU are applied using a retrospective transition method to each period presented. The Company adopted ASU 2016-15 effective January 1, 2018. The adoption of this ASU did not have a material impact on the Company’s condensed consolidated financial statements. ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business narrows the definition of a business and provides additional guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. This accounting standards update is required to be applied prospectively to transactions occurring after the date of adoption. The Company adopted ASU 2017-09 effective January 1, 2018. The adoption of this ASU did not have a material impact on the Company’s condensed consolidated financial statements. ASU 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting provides guidance on determining changes to the terms and conditions of share-based payment awards and require an entity to apply modification accounting under Topic 718 unless all of the following conditions are met: (1) the fair value of the modified award is the same as the fair value of the original award immediately before the original award is modified. If the modification does not affect any of the inputs to the valuation technique that the entity uses to value the award, the entity is not required to estimate the value immediately before and after the modification; (2) the vesting conditions of the modified award are the same as the vesting conditions of the original award immediately before the original award is modified; and (3) the classification of the modified award as an equity instrument or a liability instrument is the same as the classification of the original award immediately before the original award is modified. The amendments should be applied prospectively to an award modified on or after the adoption date. The Company adopted ASU 2017-09 effective January 1, 2018. The adoption of this ASU did not have a material impact on the Company’s condensed consolidated financial statements. On December 22, 2017, the U.S. federal government enacted the Tax Cuts and Jobs Act (“the Act”). The Tax Act contains, among other things, significant changes to corporate taxation, including reduction of the corporate tax rate from a top marginal rate of 35% to a flat rate of 21% for tax years beginning after December 31, 2017, limitation of the deduction for net operating losses to 80% of current year taxable income and elimination of net operating loss carrybacks, implementing a territorial tax system, and requiring a mandatory one-time tax on U.S. owned undistributed foreign earnings and profits known as the transition tax. In December 2017, SEC staff issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (“SAB 118”) to address the accounting implications of recently enacted U.S. federal tax reform. SAB 118 allows companies to record provisional amounts during a measurement period not to extend beyond one year of the enactment date to address ongoing guidance and tax interpretations that are expected over the next 12 months. The Company has adopted SAB 118 and currently considers its accounting of the impact of U.S. federal tax reform to be incomplete but continues to make a reasonable estimate of the effects on our existing deferred tax assets. The Company expects to complete the remainder of the analysis within the measurement period in accordance with SAB 118. Adjustments, if any, are not expected to impact the condensed consolidated statement of operations and comprehensive loss due to the full valuation allowance on the Company’s deferred tax assets. ASU 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting simplifies the accounting for share-based payment awards issued to nonemployees for goods and services, including fixing the estimated fair value of the stock award at the date of grant. ASU 2018-07 expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from non-employees. Consequently, the accounting for share-based payments to nonemployees and employees will be substantially aligned. The adoption of ASU 2018-07 requires a modified retrospective transition approach, with a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year. ASU 2018-07 is effective for public companies for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. Early adoption is permitted, but no earlier than an entity’s adoption date of Topic 606. The Company early adopted ASU 2018-07 effective July 1, 2018. The adoption of this ASU did not have a material impact on the Company’s condensed consolidated financial statements. In August 2018, the SEC adopted amendments to certain disclosure requirements in Securities Act Release No. 33-10532, Disclosure Update and Simplification. These amendments eliminate, modify, or integrate into other SEC requirements certain disclosure rules. Among the amendments is the requirement to present an analysis of changes in stockholders’ equity in the interim financial statements included in quarterly reports on Form 10-Q. The analysis, which can be presented as a footnote or separate statement, is required for the current and comparative quarter and year-to-date interim periods. The amendments became effective for all filings made on or after November 5, 2018. In light of the anticipated timing of effectiveness of the amendments and expected proximity of effectiveness to the filing date for most filers’ quarterly reports, the SEC’s Division of Corporate Finance issued a Compliance and Disclosure Interpretation related to Exchange Act Forms, or CDI – Question 105.09, that provides transition guidance related to this disclosure requirement. CDI – Question 105.09 states that the SEC would not object if the filer’s first presentation of the changes in shareholders’ equity is included in its Form 10-Q for the quarter that begins after the effective date of the amendments. Except for the requirement to provide the annual disclosure changes in stockholders’ equity for interim periods, which will be included beginning with the Company's quarterly report on Form 10-Q ending March 31, 2019, the Company has adopted all relevant disclosure requirements. Accounting Pronouncements Issued But Not Yet Effective ASU 2016-02, Leases (Topic 842) establishes a right-of-use model (“ROU”) that requires all lessees to recognize ROU assets and liabilities for leases with a duration greater than one year on the balance sheet as well as provide disclosures with respect to certain qualitative and quantitative information regarding the amount, timing and uncertainty of cash flows arising from leases. Both a ROU asset and liability will initially be measured at the present value of the future minimum lease payments over the lease term. Subsequent measurement, including the presentation of expenses and cash flows, will depend on the classification of the lease as either a finance or an operating lease. Initial costs directly attributable to negotiating and arranging the lease will be included in the asset. The new standard is effective for fiscal years beginning after December 15, 2018, and interim periods therein. Early adoption is permitted. Originally, entities were required to adopt ASU 2016-02 using a modified retrospective approach, which required prior periods to be presented under this new standard with various practical expedients allowed. In July 2018, the Financial Accounting Standards Board (“FASB”) issued ASU 2018-11, Leases (Topic 842): Targeted Improvements , which now allows entities the option of recognizing the cumulative effect of applying the new standard as an adjustment to the opening balance of retained earnings in the year of adoption (January 1, 2019) while continuing to present all prior periods under previous lease accounting guidance. The Company intends to adopt the standard on January 1, 2019 by recognizing a cumulative effect adjustment to the opening balance of retained earnings and utilizing the practical expedient that allows the Company to not reassess whether an expired or existing contract contains a lease, the classification of leases or initial direct costs. The Company is in the process of inventorying and scoping its existing lease contracts. While the Company is currently evaluating the impact of adopting this accounting standard update on its condensed consolidated financial statements and related disclosures, the Company anticipates that ROU assets and corresponding liabilities will be recognized in its condensed consolidated balance sheets related to its lease arrangements. The adoption of these standards are also expected to impact the Company’s condensed consolidated financial statement disclosures. ASU 2017-04, Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment simplifies how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. Step 2 measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. Under the amendments in ASU 2017-04, an entity should recognize an impairment charge for the amount by which the carrying amount of a reporting unit exceeds its fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The updated guidance requires a prospective adoption. ASU 2017-04 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently evaluating the timing and impact of adopting this ASU on its condensed consolidated financial statements and related disclosures. ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement modifies the disclosure requirements in Topic 820, Fair Value Measurement, by removing certain disclosure requirements related to the fair value hierarchy, modifying existing disclosure requirements related to measurement uncertainty and adding new disclosure requirements, such as disclosing the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period and disclosing the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. This ASU is effective for public companies for fiscal years beginning after December 15, 2019, including interim periods within that fiscal year. Early adoption is permitted for any removed or modified disclosures. The Company is currently evaluating the timing and impact of adopting this ASU on its condensed consolidated financial statements and related disclosures. |
Cash, Cash Equivalents and Mark
Cash, Cash Equivalents and Marketable Securities | 9 Months Ended |
Sep. 30, 2018 | |
Cash and Cash Equivalents [Abstract] | |
Cash, Cash Equivalents, and Marketable Securities | Cash, Cash Equivalents and Marketable SecuritiesThe following table summarizes the amortized cost and fair value of the Company's cash, cash equivalents and marketable securities as of September 30, 2018 (in thousands): Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value (in thousands) Current assets: Cash $ 4,747 $ — $ — $ 4,747 Cash equivalents: Commercial paper 58,127 — — 58,127 Corporate debt securities 1,624 — — 1,624 Money market funds 97,686 — — 97,686 Certificate of deposits 854 — — 854 Total cash equivalents 158,291 — — 158,291 Total cash and cash equivalents 163,038 — — 163,038 Marketable securities: Commercial paper 174,769 1 (1) 174,769 Corporate debt securities 47,416 — (30) 47,386 Certificate of deposits 118,775 — — 118,775 U.S. Treasuries 35,173 — (16) 35,157 Total marketable securities 376,133 1 (47) 376,087 Total cash, cash equivalents and marketable securities $ 539,171 $ 1 $ (47) $ 539,125 The following table summarizes the cost and fair value of marketable securities based on stated effective maturities as of September 30, 2018 (in thousands): Amortized Cost Fair Value Due within one year $ 345,678 $ 345,644 Due between one and two years 30,455 30,443 Total $ 376,133 $ 376,087 The Company did not hold any marketable securities as of December 31, 2017. There have been no significant realized gains or losses on available-for-sale securities for the periods presented. Available-for-sale debt securities that were in a continuous loss position but were not deemed to be other than temporarily impaired were immaterial at September 30, 2018. See Note 4 for further information regarding the fair value of the Company's financial instruments. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The carrying amount of the Company’s financial instruments, including cash and cash equivalents, other current assets, accounts payable, accrued and other current liabilities approximate their fair value due to their short maturities. 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 following tables summarize assets and liabilities recognized or disclosed at fair value on a recurring basis as of September 30, 2018 and December 31, 2017 (in thousands): Level 1 Level 2 Level 3 Total September 30, 2018 Assets: Cash equivalents: Commercial paper $ — $ 58,127 $ — $ 58,127 Corporate debt securities — 1,624 — 1,624 Money market funds 97,686 — — 97,686 Certificate of deposits — 854 — 854 Marketable securities Commercial paper — 174,769 — 174,769 Corporate debt securities — 47,386 — 47,386 Certificate of deposits — 118,775 — 118,775 U.S. Treasuries — 35,157 — 35,157 Total assets(1) $ 97,686 $ 436,692 $ — $ 534,378 Liabilities: Common stock warrant liabilities(2) $ — $ — $ 607 $ 607 Contingent consideration liabilities(3) — — 80,100 80,100 Total liabilities $ — $ — $ 80,707 $ 80,707 Level 1 Level 2 Level 3 Total December 31, 2017 Assets: Cash equivalents consisting of money market funds(1) $ 289,782 $ — $ — $ 289,782 Total assets $ 289,782 $ — $ — $ 289,782 Liabilities: Common stock warrant liabilities(2) $ — $ — $ 512 $ 512 Contingent consideration liabilities(3) — — 76,900 76,900 Total liabilities $ — $ — $ 77,412 $ 77,412 (1) Fair value is determined by taking into consideration valuations obtained from third-party pricing services. The third-party pricing services utilize industry standard valuation models, for which all significant inputs are observable, either directly or indirectly, to estimate fair value. These inputs include reported trades of and broker/dealer quotes on the same or similar securities; issuer credit spreads; benchmark securities; and other observable inputs. (2) Represents the fair value of common stock warrants outstanding that may require cash settlement under certain circumstances. The Company estimated the fair value of the warrant liabilities using the Black-Scholes valuation model. As of December 31, 2017 and September 30, 2018, common stock warrant liabilities relate to warrants issued in July 2011 in connection with a debt financing arrangement. The warrants entitle the holder to purchase up to 28,125 shares of common stock at an exercise price of $72.00 per share. The warrants will expire in July 2021. (3) In connection with a prior acquisition, the Company may be required to pay future consideration that is contingent upon the achievement of specified development, regulatory approval or sales-based milestone events. The Company estimated the fair value of the contingent consideration liabilities on the acquisition date using a probability-weighted income approach, which reflects the probability and timing of future payments. This fair value measurement is based on significant Level 3 inputs such as the anticipated timelines and probability of achieving development, regulatory approval or sales-based milestone events and projected revenues. The resulting probability-weighted cash flows are discounted at risk-adjusted rates. Subsequent to the acquisition date, at each reporting period prior to settlement, the Company revalues these liabilities by performing a review of the assumptions listed above and record increases or decreases in the fair value of these contingent consideration liabilities. In the absence of any significant changes in key assumptions, the quarterly determination of fair values of these contingent consideration liabilities would primarily reflect the passage of time and risk-adjusted interest rates. Significant judgment is used in determining Level 3 inputs and fair value measurements as of the acquisition date and for each subsequent reporting period. Updates to assumptions could have a significant impact on the Company’s results of operations in any given period and actual results may differ from estimates. For example, significant increases in the probability of achieving a milestone or projected revenues would result in a significantly higher fair value measurement while significant decreases in the estimated probability of achieving a milestone or projected revenues would result in a significantly lower fair value measurement. Significant increases in the discount rate or in the anticipated timelines would result in a significantly lower fair value measurement while significant decreases in the discount rate or anticipated timelines would result in a significantly higher fair value measurement. The potential contingent consideration payments required upon achievement of development, regulatory approval and sales-based milestones related to the Company’s acquisition of ZX008 range from zero if none of the milestones are achieved to a maximum of $95.0 million (undiscounted). As of September 30, 2018, the Company has classified $32.5 million of the total contingent consideration liabilities of $80.1 million as current liabilities. The classification was based upon the Company’s reasonable expectation as to the timing of settlement of certain specified milestones. The following table provides a reconciliation of liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three and nine months ended September 30, 2018 and 2017 (in thousands): June 30, 2018 Change in Fair Value September 30, 2018 June 30, 2017 Change in Fair Value September 30, 2017 Contingent consideration liabilities $ 74,400 $ 5,700 $ 80,100 $ 53,900 $ 10,500 $ 64,400 Common stock warrant liabilities 543 64 607 69 380 449 December 31, 2017 Change in Fair Value September 30, 2018 December 31, 2016 Change in Fair Value September 30, 2017 Contingent consideration liabilities 76,900 $ 3,200 $ 80,100 $ 52,800 $ 11,600 $ 64,400 Common stock warrant liabilities 512 95 607 809 (360) 449 The changes in fair value of the liabilities shown in the table above are recorded through change in fair value of contingent consideration liabilities within operating expense and the change in fair value of common stock warrant liabilities within other income (expense) in the condensed consolidated statements of operations. There were no transfers between levels during the periods presented. See Note 3 for further information regarding the amortized cost of the Company's financial instruments. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Leases The Company has two noncancellable operating leases consisting of administrative and research and development office space for its Emeryville, California headquarters and former headquarters in San Diego, California that expire in November 2022 and March 2020, respectively. The former headquarters has been subleased to an unrelated third party for the remainder of the Company’s original lease term. Future minimum lease payments under our non-cancellable operating leases at September 30, 2018, net of sublease income, were as follows (in thousands): Gross Lease Payments Sublease Income Net Lease Payments 2018 (remaining 3 months) $ 481 $ (136) $ 345 2019 1,955 (576) 1,379 2020 1,234 (148) 1,086 2021 1,004 — 1,004 2022 946 — 946 Total $ 5,620 $ (860) $ 4,760 In October 2018, the Company executed a lease for new headquarters with its current landlord to move to a facility nearby its current headquarters in Emeryville, California. The lease has an initial term that expires on June 30, 2027 and provides for one five Legal Matters The Company is not currently involved in any material legal proceedings. The Company may become involved in various legal proceedings and claims that arise in the ordinary course of business. Such matters are subject to uncertainty and there can be no assurance that such legal proceedings will not have a material adverse effect on its business, results of operations, financial position or cash flows. |
Sale of Common Stock
Sale of Common Stock | 9 Months Ended |
Sep. 30, 2018 | |
Equity [Abstract] | |
Sale of Common Stock | Sale of Common Stock The Company has an at-the-market offering program (“ATM Program”) with Cantor Fitzgerald & Co. (“Cantor”), as sales agent, pursuant to which the Company may offer and sell, from time to time, through Cantor, shares of its common stock having an aggregate offering price of up to $75.0 million under a previously filed and effective registration statement on Form S-3 (File No. 333-220759) and a prospectus supplement filed in December 2017. Cantor is entitled to a commission at a fixed commission rate of up to 3% of the gross proceeds of the sales price of all common stock sold under the ATM program. The Company and Cantor may each terminate the ATM program at any time upon ten days’ prior notice. In the second quarter of 2018, the Company sold a total of 740,417 shares of its common stock under the ATM program and received net proceeds of approximately $30.3 million, after deducting commissions and other offering expenses of $1.1 million. In August 2018, the Company completed an underwritten public offering for the sale of 6,000,000 shares of its common stock. Net proceeds raised from the offering were approximately $292.9 million, after deducting underwriting discounts and commissions and other offering expenses of $19.1 million. |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation The Company has adopted certain equity incentive and stock purchase plans as described in the consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. In March 2018, our board of directors approved an amendment and restatement of our non-employee director compensation policy, pursuant to which any non-employee director who is first elected to the board of directors is granted an option to purchase 20,000 shares of our common stock on the date of his or her initial election to the board of directors. In addition, on the date of each annual meeting of our stockholders, commencing with the 2018 annual meeting, each non-employee director is eligible to receive an option to purchase 15,000 shares of common stock. Prior to March 2018, under our non-employee director compensation policy, any non-employee director who was first elected to the board of directors was granted an option to purchase 30,000 shares of our common stock on the date of his or her initial election to the board of directors. In addition, on the date of each annual meeting of our stockholders, each non-employee director was eligible to receive an option to purchase 20,000 shares of common stock. Performance Stock Options In October 2015, the Company granted employees certain performance-based stock options for retention purposes. The stock options would vest upon satisfaction of a specified regulatory milestone within three years of the date of grant. In 2017, management determined the achievement of the performance condition was no longer probable and the cumulative compensation expense previously recognized was reversed. In September 2018, these awards were modified to allow for 90% of such options outstanding at the modification date to vest immediately. The remaining 10% of the awards were canceled in October 2018 since the performance condition was not met. This improbable to probable modification resulted in the calculation and recognition of incremental stock-based compensation expense of $3.5 million during the third quarter of 2018. Equity Incentive Awards Activity Stock Options The following is a summary of stock option activity for the nine months ended September 30, 2018 (in thousands, except per share data): Shares (in thousands) Weighted- Average Exercise Price per Share Outstanding at December 31, 2017 3,392 $ 14.41 Granted 842 43.13 Exercised (290) 16.45 Canceled (59) 26.10 Outstanding at September 30, 2018 3,885 $ 20.30 Restricted Stock Units The following is a summary of restricted stock unit activity for the nine months ended September 30, 2018 (in thousands, except per share data): Shares (in thousands) Weighted- Average Fair Value per Share at Grant Date Outstanding at December 31, 2017 259 $ 10.43 Granted 146 42.76 Vested (98) 10.74 Canceled (8) 29.74 Outstanding at September 30, 2018 299 $ 25.58 As of September 30, 2018, outstanding restricted stock units included 159,000 granted in March 2017 with performance-based conditions to employees and executives. The restricted stock units vest upon the approval of the Company’s new drug application for ZX008 by the FDA, provided such approval occurs within five years following the grant date. Due to the uncertainties associated with the FDA approval process, approval is not yet probable, as such term is used for accounting purposes, prior to the occurrence of the event. Accordingly, no compensation expense has been recognized to date for these performance-based awards. Valuation of Equity Awards The fair value of the stock options granted or modified during the periods indicated was estimated using the Black-Scholes option pricing model, based on the following assumptions: Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Risk free interest rate 2.8% to 2.9% 1.9% to 2.1% 2.3% to 2.9% 1.9% to 2.3% Expected term 3.5 to 6.1 years 6.1 years 3.5 to 6.1 years 5.1 to 6.1 years Expected volatility 79.9% to 83.2% 75.1% to 75.5% 79.9% to 85.2% 75.1% to 76.6% Expected dividend yield — % — % — % — % The fair value of restricted stock units granted is determined based on the price of the Company's common stock on the date of grant. Stock-Based Compensation Expense The following table summarizes the components of total stock-based compensation expense included in the condensed consolidated statements of operations (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Cost of contract manufacturing $ — $ — $ — $ 71 Research and development 3,275 294 5,018 1,313 Selling, general and administrative 3,706 968 6,934 2,682 Total $ 6,981 $ 1,262 $ 11,952 $ 4,066 |
Net Loss Per Share
Net Loss Per Share | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Net Loss per Share | Net Loss Per Share Basic net loss from continuing operations per share is calculated by dividing net loss from continuing operations by the weighted average number of shares outstanding for the period. Diluted net loss from continuing operations per share is calculated by dividing net loss from continuing operations by the weighted average number of shares of common stock and potential dilutive common stock equivalents outstanding during the period if the effect is dilutive. The Company’s potentially dilutive shares of common stock include outstanding stock options, restricted stock units and warrants to purchase common stock. A reconciliation of the numerators and denominators used in computing net loss from continuing operations per share is as follows (in thousands, except per share amounts): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Numerator: Net loss from continuing operations $ (42,264) $ (42,660) $ (101,283) $ (86,239) Denominator: Shares used in per share calculation 39,242 25,431 36,485 25,024 Net loss from continuing operations per share, basic and diluted $ (1.08) $ (1.68) $ (2.78) $ (3.45) The following table presents the potential shares of common stock outstanding that were excluded from the computation of diluted net loss from continuing operations per share for the periods presented because including them would have been anti-dilutive (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Shares subject to outstanding common stock options 3,957 4,121 3,752 3,879 Shares subject to outstanding restricted stock units 303 271 287 228 Shares subject to outstanding warrants to purchase common stock 28 1,251 35 1,522 Total 4,288 5,643 4,074 5,629 |
United Kingdom (U.K.) Research
United Kingdom (U.K.) Research and Development Incentives | 9 Months Ended |
Sep. 30, 2018 | |
Other Income and Expenses [Abstract] | |
United Kingdom (U.K.) Research and Development Incentives | United Kingdom (U.K.) Research and Development IncentivesThe Company carries out extensive research and development activities that benefit from the U.K.’s small and medium-sized enterprise (“SME”) research and development tax credit regime, whereby the Company may either receive an enhanced U.K. tax deduction on its eligible research and development activities or, when an SME entity is in a net operating loss position, elect to surrender net operating losses that arise from its eligible research and development activities in exchange for a cash payment from the U.K. tax authorities. These refundable cash credits, which may be received without regard to actual tax liability, are not subject to accounting for income taxes and have been recorded as a component of other income. In December 2017, the Company filed a claim as an SME for a $3.0 million refundable cash credit for its 2015 tax year, which was received in July 2018. The Company recorded this amount as a component of other income for the nine months ended September 30, 2018. As of the date hereof, the Company has not filed claims for any refundable cash credit for its 2016 or 2017 tax years, nor has it recorded any balances related to claims for these years or for the 2018 tax year, as collectability is deemed not probable or reasonably assured. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results may differ from those estimates. |
Cash Equivalents and Marketable Securities | Cash Equivalents and Marketable Securities 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 at the date of purchase. The Company invests its excess cash in marketable securities with high credit ratings that are classified as Level 1 and Level 2 within the fair value hierarchy. These marketable securities consists of money market funds and certificate of deposits, securities issued by the U.S. government and its agencies, corporate debt securities and commercial paper, which are all classified as “available-for-sale”. The Company considers all available-for-sale securities, including those with maturity dates beyond 12 months, as available to support current operational liquidity needs and, therefore, classifies all securities with maturity dates beyond three months at the date of purchase as current assets on the condensed consolidated balance sheets. The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity, which is included in interest income on the condensed consolidated statements of operations and comprehensive loss. Realized gains and losses and declines in value judged to be other-than-temporary, if any, on marketable securities are included in interest income (expense), net. The cost of securities sold is determined using the specific identification method. The Company periodically evaluates whether declines in fair values of its marketable securities below their book value are other-than-temporary. This evaluation consists of several qualitative and quantitative factors regarding the severity and duration of the unrealized loss as well as the Company’s ability and intent to hold the marketable security until a forecasted recovery occurs. Additionally, the Company assesses whether it has plans to sell the security or it is more likely than not it will be required to sell any marketable securities before recovery of its amortized cost basis. Factors considered include quoted market prices, recent financial results and operating trends, implied values from any recent transactions or offers of investee securities, credit quality of debt instrument issuers, other publicly available information that may affect the value of the marketable security, duration and severity of the decline in value, and management’s strategy and intentions for holding the marketable security. To date, the Company has not recorded any impairment charges on its marketable securities related to other-than-temporary declines in market value. |
Concentration of Credit Risk | Concentration of Credit RiskCash, cash equivalents and marketable securities are financial instruments that potentially subject the Company to concentration of credit risk. The Company invests its excess cash primarily in money market funds and certificate of deposits, securities issued by the U.S. government and its agencies, corporate debt securities and commercial paper. The Company has established guidelines relative to diversification and maturities to maintain safety and liquidity. The Company has not experienced any credit losses related to these financial instruments and does not believe it is exposed to any significant credit risk related to these instruments. |
Recent Accounting Pronouncements | Accounting Pronouncements Recently Adopted Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers (Topic 606) and subsequent amendments to the initial guidance (collectively, “Topic 606”) amended the existing accounting standards for revenue recognition. The core principle of Topic 606 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. The Company adopted Topic 606 effective January 1, 2018 using the modified retrospective approach. The adoption of Topic 606 did not have a material impact on the Company’s condensed consolidated financial statements as the Company does not have any contracts with customers. ASU 2016-15, Statement of Cash Flows (Topic 230) provides guidance on eight specific cash flow issues, thereby reducing the diversity in practice in how certain transactions are classified in the statement of cash flows. The amendments in this ASU are applied using a retrospective transition method to each period presented. The Company adopted ASU 2016-15 effective January 1, 2018. The adoption of this ASU did not have a material impact on the Company’s condensed consolidated financial statements. ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business narrows the definition of a business and provides additional guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. This accounting standards update is required to be applied prospectively to transactions occurring after the date of adoption. The Company adopted ASU 2017-09 effective January 1, 2018. The adoption of this ASU did not have a material impact on the Company’s condensed consolidated financial statements. ASU 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting provides guidance on determining changes to the terms and conditions of share-based payment awards and require an entity to apply modification accounting under Topic 718 unless all of the following conditions are met: (1) the fair value of the modified award is the same as the fair value of the original award immediately before the original award is modified. If the modification does not affect any of the inputs to the valuation technique that the entity uses to value the award, the entity is not required to estimate the value immediately before and after the modification; (2) the vesting conditions of the modified award are the same as the vesting conditions of the original award immediately before the original award is modified; and (3) the classification of the modified award as an equity instrument or a liability instrument is the same as the classification of the original award immediately before the original award is modified. The amendments should be applied prospectively to an award modified on or after the adoption date. The Company adopted ASU 2017-09 effective January 1, 2018. The adoption of this ASU did not have a material impact on the Company’s condensed consolidated financial statements. On December 22, 2017, the U.S. federal government enacted the Tax Cuts and Jobs Act (“the Act”). The Tax Act contains, among other things, significant changes to corporate taxation, including reduction of the corporate tax rate from a top marginal rate of 35% to a flat rate of 21% for tax years beginning after December 31, 2017, limitation of the deduction for net operating losses to 80% of current year taxable income and elimination of net operating loss carrybacks, implementing a territorial tax system, and requiring a mandatory one-time tax on U.S. owned undistributed foreign earnings and profits known as the transition tax. In December 2017, SEC staff issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (“SAB 118”) to address the accounting implications of recently enacted U.S. federal tax reform. SAB 118 allows companies to record provisional amounts during a measurement period not to extend beyond one year of the enactment date to address ongoing guidance and tax interpretations that are expected over the next 12 months. The Company has adopted SAB 118 and currently considers its accounting of the impact of U.S. federal tax reform to be incomplete but continues to make a reasonable estimate of the effects on our existing deferred tax assets. The Company expects to complete the remainder of the analysis within the measurement period in accordance with SAB 118. Adjustments, if any, are not expected to impact the condensed consolidated statement of operations and comprehensive loss due to the full valuation allowance on the Company’s deferred tax assets. ASU 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting simplifies the accounting for share-based payment awards issued to nonemployees for goods and services, including fixing the estimated fair value of the stock award at the date of grant. ASU 2018-07 expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from non-employees. Consequently, the accounting for share-based payments to nonemployees and employees will be substantially aligned. The adoption of ASU 2018-07 requires a modified retrospective transition approach, with a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year. ASU 2018-07 is effective for public companies for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. Early adoption is permitted, but no earlier than an entity’s adoption date of Topic 606. The Company early adopted ASU 2018-07 effective July 1, 2018. The adoption of this ASU did not have a material impact on the Company’s condensed consolidated financial statements. In August 2018, the SEC adopted amendments to certain disclosure requirements in Securities Act Release No. 33-10532, Disclosure Update and Simplification. These amendments eliminate, modify, or integrate into other SEC requirements certain disclosure rules. Among the amendments is the requirement to present an analysis of changes in stockholders’ equity in the interim financial statements included in quarterly reports on Form 10-Q. The analysis, which can be presented as a footnote or separate statement, is required for the current and comparative quarter and year-to-date interim periods. The amendments became effective for all filings made on or after November 5, 2018. In light of the anticipated timing of effectiveness of the amendments and expected proximity of effectiveness to the filing date for most filers’ quarterly reports, the SEC’s Division of Corporate Finance issued a Compliance and Disclosure Interpretation related to Exchange Act Forms, or CDI – Question 105.09, that provides transition guidance related to this disclosure requirement. CDI – Question 105.09 states that the SEC would not object if the filer’s first presentation of the changes in shareholders’ equity is included in its Form 10-Q for the quarter that begins after the effective date of the amendments. Except for the requirement to provide the annual disclosure changes in stockholders’ equity for interim periods, which will be included beginning with the Company's quarterly report on Form 10-Q ending March 31, 2019, the Company has adopted all relevant disclosure requirements. Accounting Pronouncements Issued But Not Yet Effective ASU 2016-02, Leases (Topic 842) establishes a right-of-use model (“ROU”) that requires all lessees to recognize ROU assets and liabilities for leases with a duration greater than one year on the balance sheet as well as provide disclosures with respect to certain qualitative and quantitative information regarding the amount, timing and uncertainty of cash flows arising from leases. Both a ROU asset and liability will initially be measured at the present value of the future minimum lease payments over the lease term. Subsequent measurement, including the presentation of expenses and cash flows, will depend on the classification of the lease as either a finance or an operating lease. Initial costs directly attributable to negotiating and arranging the lease will be included in the asset. The new standard is effective for fiscal years beginning after December 15, 2018, and interim periods therein. Early adoption is permitted. Originally, entities were required to adopt ASU 2016-02 using a modified retrospective approach, which required prior periods to be presented under this new standard with various practical expedients allowed. In July 2018, the Financial Accounting Standards Board (“FASB”) issued ASU 2018-11, Leases (Topic 842): Targeted Improvements , which now allows entities the option of recognizing the cumulative effect of applying the new standard as an adjustment to the opening balance of retained earnings in the year of adoption (January 1, 2019) while continuing to present all prior periods under previous lease accounting guidance. The Company intends to adopt the standard on January 1, 2019 by recognizing a cumulative effect adjustment to the opening balance of retained earnings and utilizing the practical expedient that allows the Company to not reassess whether an expired or existing contract contains a lease, the classification of leases or initial direct costs. The Company is in the process of inventorying and scoping its existing lease contracts. While the Company is currently evaluating the impact of adopting this accounting standard update on its condensed consolidated financial statements and related disclosures, the Company anticipates that ROU assets and corresponding liabilities will be recognized in its condensed consolidated balance sheets related to its lease arrangements. The adoption of these standards are also expected to impact the Company’s condensed consolidated financial statement disclosures. ASU 2017-04, Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment simplifies how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. Step 2 measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. Under the amendments in ASU 2017-04, an entity should recognize an impairment charge for the amount by which the carrying amount of a reporting unit exceeds its fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The updated guidance requires a prospective adoption. ASU 2017-04 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently evaluating the timing and impact of adopting this ASU on its condensed consolidated financial statements and related disclosures. ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement modifies the disclosure requirements in Topic 820, Fair Value Measurement, by removing certain disclosure requirements related to the fair value hierarchy, modifying existing disclosure requirements related to measurement uncertainty and adding new disclosure requirements, such as disclosing the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period and disclosing the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. This ASU is effective for public companies for fiscal years beginning after December 15, 2019, including interim periods within that fiscal year. Early adoption is permitted for any removed or modified disclosures. The Company is currently evaluating the timing and impact of adopting this ASU on its condensed consolidated financial statements and related disclosures. |
Fair Value Measurements | The carrying amount of the Company’s financial instruments, including cash and cash equivalents, other current assets, accounts payable, accrued and other current liabilities approximate their fair value due to their short maturities. |
Stock-based Compensation | The Company has adopted certain equity incentive and stock purchase plans as described in the consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. |
Net Loss per Share | Basic net loss from continuing operations per share is calculated by dividing net loss from continuing operations by the weighted average number of shares outstanding for the period. Diluted net loss from continuing operations per share is calculated by dividing net loss from continuing operations by the weighted average number of shares of common stock and potential dilutive common stock equivalents outstanding during the period if the effect is dilutive. |
Cash, Cash Equivalents and Ma_2
Cash, Cash Equivalents and Marketable Securities (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Cash and Cash Equivalents [Abstract] | |
Amortized Cost and Fair Value of Cash, Cash Equivalents and Marketable Securities | The following table summarizes the amortized cost and fair value of the Company's cash, cash equivalents and marketable securities as of September 30, 2018 (in thousands): Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value (in thousands) Current assets: Cash $ 4,747 $ — $ — $ 4,747 Cash equivalents: Commercial paper 58,127 — — 58,127 Corporate debt securities 1,624 — — 1,624 Money market funds 97,686 — — 97,686 Certificate of deposits 854 — — 854 Total cash equivalents 158,291 — — 158,291 Total cash and cash equivalents 163,038 — — 163,038 Marketable securities: Commercial paper 174,769 1 (1) 174,769 Corporate debt securities 47,416 — (30) 47,386 Certificate of deposits 118,775 — — 118,775 U.S. Treasuries 35,173 — (16) 35,157 Total marketable securities 376,133 1 (47) 376,087 Total cash, cash equivalents and marketable securities $ 539,171 $ 1 $ (47) $ 539,125 |
Cost and Fair Value of Marketable Securities | The following table summarizes the cost and fair value of marketable securities based on stated effective maturities as of September 30, 2018 (in thousands): Amortized Cost Fair Value Due within one year $ 345,678 $ 345,644 Due between one and two years 30,455 30,443 Total $ 376,133 $ 376,087 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Liabilities Measured at Fair Value on Recurring Basis | The following tables summarize assets and liabilities recognized or disclosed at fair value on a recurring basis as of September 30, 2018 and December 31, 2017 (in thousands): Level 1 Level 2 Level 3 Total September 30, 2018 Assets: Cash equivalents: Commercial paper $ — $ 58,127 $ — $ 58,127 Corporate debt securities — 1,624 — 1,624 Money market funds 97,686 — — 97,686 Certificate of deposits — 854 — 854 Marketable securities Commercial paper — 174,769 — 174,769 Corporate debt securities — 47,386 — 47,386 Certificate of deposits — 118,775 — 118,775 U.S. Treasuries — 35,157 — 35,157 Total assets(1) $ 97,686 $ 436,692 $ — $ 534,378 Liabilities: Common stock warrant liabilities(2) $ — $ — $ 607 $ 607 Contingent consideration liabilities(3) — — 80,100 80,100 Total liabilities $ — $ — $ 80,707 $ 80,707 Level 1 Level 2 Level 3 Total December 31, 2017 Assets: Cash equivalents consisting of money market funds(1) $ 289,782 $ — $ — $ 289,782 Total assets $ 289,782 $ — $ — $ 289,782 Liabilities: Common stock warrant liabilities(2) $ — $ — $ 512 $ 512 Contingent consideration liabilities(3) — — 76,900 76,900 Total liabilities $ — $ — $ 77,412 $ 77,412 (1) Fair value is determined by taking into consideration valuations obtained from third-party pricing services. The third-party pricing services utilize industry standard valuation models, for which all significant inputs are observable, either directly or indirectly, to estimate fair value. These inputs include reported trades of and broker/dealer quotes on the same or similar securities; issuer credit spreads; benchmark securities; and other observable inputs. (2) Represents the fair value of common stock warrants outstanding that may require cash settlement under certain circumstances. The Company estimated the fair value of the warrant liabilities using the Black-Scholes valuation model. As of December 31, 2017 and September 30, 2018, common stock warrant liabilities relate to warrants issued in July 2011 in connection with a debt financing arrangement. The warrants entitle the holder to purchase up to 28,125 shares of common stock at an exercise price of $72.00 per share. The warrants will expire in July 2021. (3) In connection with a prior acquisition, the Company may be required to pay future consideration that is contingent upon the achievement of specified development, regulatory approval or sales-based milestone events. The Company estimated the fair value of the contingent consideration liabilities on the acquisition date using a probability-weighted income approach, which reflects the probability and timing of future payments. This fair value measurement is based on significant Level 3 inputs such as the anticipated timelines and probability of achieving development, regulatory approval or sales-based milestone events and projected revenues. The resulting probability-weighted cash flows are discounted at risk-adjusted rates. Subsequent to the acquisition date, at each reporting period prior to settlement, the Company revalues these liabilities by performing a review of the assumptions listed above and record increases or decreases in the fair value of these contingent consideration liabilities. In the absence of any significant changes in key assumptions, the quarterly determination of fair values of these contingent consideration liabilities would primarily reflect the passage of time and |
Assets Measured at Fair Value on Recurring Basis | The following tables summarize assets and liabilities recognized or disclosed at fair value on a recurring basis as of September 30, 2018 and December 31, 2017 (in thousands): Level 1 Level 2 Level 3 Total September 30, 2018 Assets: Cash equivalents: Commercial paper $ — $ 58,127 $ — $ 58,127 Corporate debt securities — 1,624 — 1,624 Money market funds 97,686 — — 97,686 Certificate of deposits — 854 — 854 Marketable securities Commercial paper — 174,769 — 174,769 Corporate debt securities — 47,386 — 47,386 Certificate of deposits — 118,775 — 118,775 U.S. Treasuries — 35,157 — 35,157 Total assets(1) $ 97,686 $ 436,692 $ — $ 534,378 Liabilities: Common stock warrant liabilities(2) $ — $ — $ 607 $ 607 Contingent consideration liabilities(3) — — 80,100 80,100 Total liabilities $ — $ — $ 80,707 $ 80,707 Level 1 Level 2 Level 3 Total December 31, 2017 Assets: Cash equivalents consisting of money market funds(1) $ 289,782 $ — $ — $ 289,782 Total assets $ 289,782 $ — $ — $ 289,782 Liabilities: Common stock warrant liabilities(2) $ — $ — $ 512 $ 512 Contingent consideration liabilities(3) — — 76,900 76,900 Total liabilities $ — $ — $ 77,412 $ 77,412 (1) Fair value is determined by taking into consideration valuations obtained from third-party pricing services. The third-party pricing services utilize industry standard valuation models, for which all significant inputs are observable, either directly or indirectly, to estimate fair value. These inputs include reported trades of and broker/dealer quotes on the same or similar securities; issuer credit spreads; benchmark securities; and other observable inputs. (2) Represents the fair value of common stock warrants outstanding that may require cash settlement under certain circumstances. The Company estimated the fair value of the warrant liabilities using the Black-Scholes valuation model. As of December 31, 2017 and September 30, 2018, common stock warrant liabilities relate to warrants issued in July 2011 in connection with a debt financing arrangement. The warrants entitle the holder to purchase up to 28,125 shares of common stock at an exercise price of $72.00 per share. The warrants will expire in July 2021. (3) In connection with a prior acquisition, the Company may be required to pay future consideration that is contingent upon the achievement of specified development, regulatory approval or sales-based milestone events. The Company estimated the fair value of the contingent consideration liabilities on the acquisition date using a probability-weighted income approach, which reflects the probability and timing of future payments. This fair value measurement is based on significant Level 3 inputs such as the anticipated timelines and probability of achieving development, regulatory approval or sales-based milestone events and projected revenues. The resulting probability-weighted cash flows are discounted at risk-adjusted rates. Subsequent to the acquisition date, at each reporting period prior to settlement, the Company revalues these liabilities by performing a review of the assumptions listed above and record increases or decreases in the fair value of these contingent consideration liabilities. In the absence of any significant changes in key assumptions, the quarterly determination of fair values of these contingent consideration liabilities would primarily reflect the passage of time and |
Reconciliation of Liabilities Measured at Fair Value Using Significant Unobservable Inputs (Level 3) | The following table provides a reconciliation of liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three and nine months ended September 30, 2018 and 2017 (in thousands): June 30, 2018 Change in Fair Value September 30, 2018 June 30, 2017 Change in Fair Value September 30, 2017 Contingent consideration liabilities $ 74,400 $ 5,700 $ 80,100 $ 53,900 $ 10,500 $ 64,400 Common stock warrant liabilities 543 64 607 69 380 449 December 31, 2017 Change in Fair Value September 30, 2018 December 31, 2016 Change in Fair Value September 30, 2017 Contingent consideration liabilities 76,900 $ 3,200 $ 80,100 $ 52,800 $ 11,600 $ 64,400 Common stock warrant liabilities 512 95 607 809 (360) 449 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Payments Under Non-cancelable Operating Leases | Future minimum lease payments under our non-cancellable operating leases at September 30, 2018, net of sublease income, were as follows (in thousands): Gross Lease Payments Sublease Income Net Lease Payments 2018 (remaining 3 months) $ 481 $ (136) $ 345 2019 1,955 (576) 1,379 2020 1,234 (148) 1,086 2021 1,004 — 1,004 2022 946 — 946 Total $ 5,620 $ (860) $ 4,760 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of Stock Option Activity | The following is a summary of stock option activity for the nine months ended September 30, 2018 (in thousands, except per share data): Shares (in thousands) Weighted- Average Exercise Price per Share Outstanding at December 31, 2017 3,392 $ 14.41 Granted 842 43.13 Exercised (290) 16.45 Canceled (59) 26.10 Outstanding at September 30, 2018 3,885 $ 20.30 |
Schedule of Restricted Stock Unit Activity | The following is a summary of restricted stock unit activity for the nine months ended September 30, 2018 (in thousands, except per share data): Shares (in thousands) Weighted- Average Fair Value per Share at Grant Date Outstanding at December 31, 2017 259 $ 10.43 Granted 146 42.76 Vested (98) 10.74 Canceled (8) 29.74 Outstanding at September 30, 2018 299 $ 25.58 |
Assumptions used in the Black-Scholes Option-Pricing Model | The fair value of the stock options granted or modified during the periods indicated was estimated using the Black-Scholes option pricing model, based on the following assumptions: Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Risk free interest rate 2.8% to 2.9% 1.9% to 2.1% 2.3% to 2.9% 1.9% to 2.3% Expected term 3.5 to 6.1 years 6.1 years 3.5 to 6.1 years 5.1 to 6.1 years Expected volatility 79.9% to 83.2% 75.1% to 75.5% 79.9% to 85.2% 75.1% to 76.6% Expected dividend yield — % — % — % — % |
Stock-Based Compensation Expense | The following table summarizes the components of total stock-based compensation expense included in the condensed consolidated statements of operations (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Cost of contract manufacturing $ — $ — $ — $ 71 Research and development 3,275 294 5,018 1,313 Selling, general and administrative 3,706 968 6,934 2,682 Total $ 6,981 $ 1,262 $ 11,952 $ 4,066 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Basic and Diluted Net Loss Per Share | A reconciliation of the numerators and denominators used in computing net loss from continuing operations per share is as follows (in thousands, except per share amounts): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Numerator: Net loss from continuing operations $ (42,264) $ (42,660) $ (101,283) $ (86,239) Denominator: Shares used in per share calculation 39,242 25,431 36,485 25,024 Net loss from continuing operations per share, basic and diluted $ (1.08) $ (1.68) $ (2.78) $ (3.45) |
Schedule of Antidilutive Securities Excluded from Computation of Diluted Net Loss per Share | The following table presents the potential shares of common stock outstanding that were excluded from the computation of diluted net loss from continuing operations per share for the periods presented because including them would have been anti-dilutive (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Shares subject to outstanding common stock options 3,957 4,121 3,752 3,879 Shares subject to outstanding restricted stock units 303 271 287 228 Shares subject to outstanding warrants to purchase common stock 28 1,251 35 1,522 Total 4,288 5,643 4,074 5,629 |
Organization and Basis of Pre_2
Organization and Basis of Presentation - Narrative (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accumulated deficit | $ 673,521 | $ 572,040 |
Cash, Cash Equivalents and Ma_3
Cash, Cash Equivalents and Marketable Securities (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Dec. 31, 2016 |
Cash and Cash Equivalents [Line Items] | ||||
Cash | $ 4,747 | |||
Cash equivalents | 158,291 | |||
Total cash and cash equivalents | 163,038 | $ 293,503 | $ 64,730 | $ 91,551 |
Marketable securities, amortized cost | 376,133 | |||
Marketable securities, gross unrealized gains | 1 | |||
Marketable securities, gross unrealized losses | (47) | |||
Marketable securities, estimated fair value | 376,087 | |||
Total cash, cash equivalents and marketable securities | 539,171 | |||
Total cash, cash equivalents and marketable securities | 539,125 | |||
Amortized Cost | ||||
Due within one year, amortized cost | 345,678 | |||
Due between one and two years, amortized cost | 30,455 | |||
Marketable securities, amortized cost | 376,133 | |||
Fair Value | ||||
Due within one year, estimated fair value | 345,644 | |||
Due between one and two years, estimated fair value | 30,443 | |||
Marketable securities, estimated fair value | 376,087 | |||
Commercial paper | ||||
Cash and Cash Equivalents [Line Items] | ||||
Cash equivalents | 58,127 | |||
Marketable securities, amortized cost | 174,769 | |||
Marketable securities, gross unrealized gains | 1 | |||
Marketable securities, gross unrealized losses | (1) | |||
Marketable securities, estimated fair value | 174,769 | |||
Corporate debt securities | ||||
Cash and Cash Equivalents [Line Items] | ||||
Cash equivalents | 1,624 | |||
Marketable securities, amortized cost | 47,416 | |||
Marketable securities, gross unrealized gains | 0 | |||
Marketable securities, gross unrealized losses | (30) | |||
Marketable securities, estimated fair value | 47,386 | |||
Money market funds | ||||
Cash and Cash Equivalents [Line Items] | ||||
Cash equivalents | 97,686 | |||
Certificate of deposits | ||||
Cash and Cash Equivalents [Line Items] | ||||
Cash equivalents | 854 | |||
Marketable securities, amortized cost | 118,775 | |||
Marketable securities, gross unrealized gains | 0 | |||
Marketable securities, gross unrealized losses | 0 | |||
Marketable securities, estimated fair value | 118,775 | |||
U.S. Treasuries | ||||
Cash and Cash Equivalents [Line Items] | ||||
Marketable securities, amortized cost | 35,173 | |||
Marketable securities, gross unrealized gains | 0 | |||
Marketable securities, gross unrealized losses | (16) | |||
Marketable securities, estimated fair value | $ 35,157 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) | 9 Months Ended | ||
Sep. 30, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Short-term fixed income securities | $ 376,087,000 | ||
Total assets | 534,378,000 | ||
Liabilities measured at fair value on a recurring basis | $ 80,707,000 | $ 77,412,000 | |
Shares of common stock exercisable through warrants | 28,125 | ||
Warrants exercise price per share (usd per share) | $ 72 | ||
Fair value of contingent consideration | $ 32,500,000 | 0 | |
Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets | 97,686,000 | ||
Liabilities measured at fair value on a recurring basis | 0 | 0 | |
Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets | 436,692,000 | ||
Liabilities measured at fair value on a recurring basis | 0 | 0 | |
Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets | 0 | ||
Liabilities measured at fair value on a recurring basis | 80,707,000 | 77,412,000 | |
Common stock warrant liabilities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Liabilities measured at fair value on a recurring basis | 607,000 | 512,000 | |
Common stock warrant liabilities | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Liabilities measured at fair value on a recurring basis | 0 | 0 | |
Common stock warrant liabilities | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Liabilities measured at fair value on a recurring basis | 0 | 0 | |
Common stock warrant liabilities | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total assets | $ 449,000 | ||
Liabilities measured at fair value on a recurring basis | 607,000 | 512,000 | |
Contingent consideration liabilities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Liabilities measured at fair value on a recurring basis | 80,100,000 | 76,900,000 | |
Contingent consideration liabilities | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Liabilities measured at fair value on a recurring basis | 0 | 0 | |
Contingent consideration liabilities | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Liabilities measured at fair value on a recurring basis | 0 | 0 | |
Contingent consideration liabilities | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Liabilities measured at fair value on a recurring basis | 76,900,000 | ||
Commercial paper | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 58,127,000 | ||
Short-term fixed income securities | 174,769,000 | ||
Commercial paper | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 0 | ||
Short-term fixed income securities | 0 | ||
Commercial paper | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 58,127,000 | ||
Short-term fixed income securities | 174,769,000 | ||
Commercial paper | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 0 | ||
Short-term fixed income securities | 0 | ||
Corporate debt securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 1,624,000 | ||
Short-term fixed income securities | 47,386,000 | ||
Corporate debt securities | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 0 | ||
Short-term fixed income securities | 0 | ||
Corporate debt securities | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 1,624,000 | ||
Short-term fixed income securities | 47,386,000 | ||
Corporate debt securities | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 0 | ||
Short-term fixed income securities | 0 | ||
Money market funds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 97,686,000 | 289,782,000 | |
Money market funds | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 97,686,000 | 289,782,000 | |
Money market funds | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 0 | 0 | |
Money market funds | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 0 | $ 0 | |
Certificate of deposits | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 854,000 | ||
Short-term fixed income securities | 118,775,000 | ||
Certificate of deposits | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 0 | ||
Short-term fixed income securities | 0 | ||
Certificate of deposits | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 854,000 | ||
Short-term fixed income securities | 118,775,000 | ||
Certificate of deposits | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 0 | ||
Short-term fixed income securities | 0 | ||
U.S. Treasuries | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Short-term fixed income securities | 35,157,000 | ||
U.S. Treasuries | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Short-term fixed income securities | 0 | ||
U.S. Treasuries | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Short-term fixed income securities | 35,157,000 | ||
U.S. Treasuries | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Short-term fixed income securities | 0 | ||
ZX008 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Potential contingent consideration payment, minimum | 0 | ||
Potential contingent consideration payment, maximum | 95,000,000 | ||
Fair value of contingent consideration | 32,500,000 | ||
Total contingent consideration | $ 80,100,000 |
Fair Value Measurements - Recon
Fair Value Measurements - Reconciliation of Liabilities Measured at Fair Value Using Significant Unobservable Inputs (Details) - Level 3 - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Contingent consideration liabilities | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Beginning Balance | $ 74,400 | $ 53,900 | $ 76,900 | $ 52,800 |
Changes in fair value | 5,700 | 10,500 | 3,200 | 11,600 |
Ending Balance | 80,100 | 64,400 | 80,100 | 64,400 |
Common stock warrant liabilities | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Beginning Balance | 543 | 69 | 512 | 809 |
Changes in fair value | 64 | 380 | 95 | (360) |
Ending Balance | $ 607 | $ 449 | $ 607 | $ 449 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) $ in Millions | 9 Months Ended | ||
Sep. 30, 2019USD ($) | Oct. 31, 2018lease | Sep. 30, 2018lease | |
Subsequent Event [Line Items] | |||
Number of Noncancelable Leases | 2 | ||
Subsequent event | |||
Subsequent Event [Line Items] | |||
Number of lease renewal options | 1 | ||
Length of each lease renewal | 5 years | ||
Term of new lease | 8 years | ||
Expected | |||
Subsequent Event [Line Items] | |||
Expected payment for rent | $ | $ 15.3 |
Commitments and Contingencies -
Commitments and Contingencies - Future Minimum Lease Payments (Details) $ in Thousands | Sep. 30, 2018USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2018 (remaining 6 months) gross lease payment due | $ 481 |
2019 gross lease payment due | 1,955 |
2020 gross lease payment due | 1,234 |
2021 gross lease payment due | 1,004 |
2022 gross lease payment due | 946 |
Total gross lease payment due | 5,620 |
2018 (remaining 6 months) sublease income | (136) |
2019 sublease income | (576) |
2020 sublease income | (148) |
2021 sublease income | 0 |
2022 sublease income | 0 |
Total sublease income | (860) |
2018 (remaining 6 months) net lease payments | 345 |
2019 net lease payments | 1,379 |
2020 net lease payments | 1,086 |
2021 net lease payments | 1,004 |
2022 net lease payments | 946 |
Total net lease payments | $ 4,760 |
Sale of Common Stock (Details)
Sale of Common Stock (Details) - Common Stock - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended |
Aug. 31, 2018 | Jun. 30, 2018 | Sep. 30, 2018 | |
Class of Stock [Line Items] | |||
Aggregate offering price | $ 75,000,000 | ||
Commission rate (percent) | 3.00% | ||
Stock issued (in shares) | 6,000,000 | 740,417 | |
Proceeds from stock issuance | $ 292,900,000 | $ 30,300,000 | |
Underwriting discounts and commissions and other offering expenses | $ 19,100,000 | $ 1,100,000 |
Stock-Based Compensation - Opti
Stock-Based Compensation - Options Activity (Details) shares in Thousands | 9 Months Ended |
Sep. 30, 2018$ / sharesshares | |
Shares (in thousands) | |
December 31, 2017 (in shares) | shares | 3,392 |
Granted (in shares) | shares | 842 |
Exercised (in shares) | shares | (290) |
Canceled (in shares) | shares | (59) |
March 31, 2018 (in shares) | shares | 3,885 |
Weighted- Average Exercise Price per Share | |
Outstanding weighted average exercise price, beginning balance (in usd per share) | $ / shares | $ 14.41 |
Granted weighted average exercise price (in usd per share | $ / shares | 43.13 |
Exercised weighted average exercise price (in usd per share | $ / shares | 16.45 |
Canceled weighted average exercise price (in usd per share | $ / shares | 26.10 |
Outstanding weighted average exercise price, ending balance (in usd per share | $ / shares | $ 20.30 |
Stock-Based Compensation - Rest
Stock-Based Compensation - Restricted Stock Unit Activity (Details) - Restricted stock units shares in Thousands | 9 Months Ended |
Sep. 30, 2018$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Outstanding at December 31, 2017 (in shares) | shares | 259 |
Granted (in shares) | shares | 146 |
Vested (in shares) | shares | (98) |
Canceled (in shares) | shares | (8) |
Outstanding at March 31, 2018 (in shares) | shares | 299 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |
Nonvested at December 31, 2017 - Weighted average fair value per share at grant date (in usd per share) | $ / shares | $ 10.43 |
Granted - Weighted average fair value per share at grant date (in usd per share) | $ / shares | 42.76 |
Vested - Weighted average fair value per share at grant date (in usd per share) | $ / shares | 10.74 |
Canceled - Weighted average fair value per share at grant date (in usd per share) | $ / shares | 29.74 |
Nonvested at March 31, 2018 - Weighted average fair value per share at grant date (in usd per share) | $ / shares | $ 25.58 |
Stock-Based Compensation - Assu
Stock-Based Compensation - Assumptions used in Black-Scholes Option-Pricing Model (Detail) - Stock Options | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Risk free interest rate, minimum | 2.80% | 1.90% | 2.30% | 1.90% |
Risk free interest rate, maximum | 2.90% | 2.10% | 2.90% | 2.30% |
Expected volatility, minimum | 79.90% | 75.10% | 79.90% | 75.10% |
Expected volatility, maximum | 83.20% | 75.50% | 85.20% | 76.60% |
Expected dividend yield | 0.00% | 0.00% | 0.00% | 0.00% |
Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term | 3 years 6 months | 6 years 1 month 6 days | 3 years 6 months | 5 years 1 month 6 days |
Maximum | ||||
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 | 6 years 1 month 6 days |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock-Based Compensation Expense (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | $ 6,981 | $ 1,262 | $ 11,952 | $ 4,066 |
Cost of contract manufacturing | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | 0 | 0 | 0 | 71 |
Research and development | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | 3,275 | 294 | 5,018 | 1,313 |
Selling, general and administrative | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | $ 3,706 | $ 968 | $ 6,934 | $ 2,682 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Mar. 31, 2018 | Feb. 28, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock-based compensation expense | $ 6,981 | $ 1,262 | $ 11,952 | $ 4,066 | |||
Performance stock options | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Percentage of outstanding options that vested (percent) | 90.00% | 90.00% | |||||
Percentage of outstanding options that were canceled (percent) | 10.00% | 10.00% | |||||
Stock-based compensation expense | $ 3,500 | ||||||
Restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Outstanding RSUs at March 31, 2018 (in shares) | 299,000 | 299,000 | 259,000 | ||||
Non-employee Director | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of options granted upon initial election to board (shares) | 20,000 | 30,000 | |||||
Additional number of options available for grant annually (shares) | 15,000 | 20,000 | |||||
Employees and Executives | Restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Outstanding RSUs at March 31, 2018 (in shares) | 159,000 | 159,000 |
Net Loss Per Share - Reconcilia
Net Loss Per Share - Reconciliation of Numerator and Denominators in Computing Net Loss per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Earnings Per Share [Abstract] | ||||
Net loss from continuing operations | $ (42,264) | $ (42,660) | $ (101,283) | $ (86,239) |
Shares used in per share calculation (in shares) | 39,242 | 25,431 | 36,485 | 25,024 |
Net loss from continuing operations per share, basic and diluted (in dollars per share) | $ (1.08) | $ (1.68) | $ (2.78) | $ (3.45) |
Net Loss Per Share - Antidiluti
Net Loss Per Share - Antidilutive Securities (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Anti-dilutive securities excluded from computation of earnings per share amount | 4,288 | 5,643 | 4,074 | 5,629 |
Shares subject to outstanding common stock options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Anti-dilutive securities excluded from computation of earnings per share amount | 3,957 | 4,121 | 3,752 | 3,879 |
Shares subject to outstanding restricted stock units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Anti-dilutive securities excluded from computation of earnings per share amount | 303 | 271 | 287 | 228 |
Shares subject to outstanding warrants to purchase common stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Anti-dilutive securities excluded from computation of earnings per share amount | 28 | 1,251 | 35 | 1,522 |
United Kingdom (U.K.) Researc_2
United Kingdom (U.K.) Research and Development Incentives (Details) $ in Millions | Dec. 31, 2017USD ($) |
Other Income and Expenses [Abstract] | |
Claim for refundable cash credit | $ 3 |