Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2022 | Apr. 29, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-35060 | |
Entity Registrant Name | PACIRA BIOSCIENCES, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 51-0619477 | |
Entity Address, Address Line One | 5401 West Kennedy Boulevard, Suite 890 | |
Entity Address, City or Town | Tampa | |
Entity Address, State or Province | FL | |
Entity Address, Postal Zip Code | 33609 | |
City Area Code | 813 | |
Local Phone Number | 553-6680 | |
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Trading Symbol | PCRX | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 45,436,752 | |
Entity Central Index Key | 0001396814 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 226,751 | $ 585,578 |
Short-term available-for-sale investments | 225,443 | 70,831 |
Accounts receivable, net | 92,103 | 96,318 |
Inventories, net | 103,662 | 98,550 |
Prepaid expenses and other current assets | 19,059 | 14,771 |
Total current assets | 667,018 | 866,048 |
Fixed assets, net | 189,767 | 188,401 |
Right-of-use assets, net | 74,271 | 76,410 |
Goodwill | 145,722 | 145,175 |
Intangible assets, net | 609,646 | 623,968 |
Deferred tax assets | 169,282 | 153,364 |
Investments and other assets | 35,770 | 21,987 |
Total assets | 1,891,476 | 2,075,353 |
Current liabilities: | ||
Accounts payable | 14,843 | 10,543 |
Accrued expenses | 87,669 | 127,555 |
Lease liabilities | 8,018 | 7,891 |
Convertible senior notes, net | 160,000 | 350,466 |
Current portion of long-term debt, net | 33,680 | 24,234 |
Income taxes payable | 863 | 429 |
Total current liabilities | 305,073 | 521,118 |
Convertible senior notes, net | 402,915 | 339,267 |
Long-term debt, net | 326,828 | 335,263 |
Lease liabilities | 69,710 | 71,727 |
Deferred revenue | 10,125 | 10,125 |
Contingent consideration | 56,527 | 57,598 |
Other liabilities | 10,722 | 9,847 |
Total liabilities | 1,181,900 | 1,344,945 |
Commitments and contingencies (Note 16) | ||
Stockholders’ equity: | ||
Preferred stock, par value $0.001; 5,000,000 shares authorized; none issued and outstanding at March 31, 2022 and December 31, 2021 | 0 | 0 |
Common stock, par value $0.001; 250,000,000 shares authorized; 45,064,459 and 44,734,308 shares issued and outstanding at March 31, 2022 and December 31, 2021, respectively | 45 | 45 |
Additional paid-in capital | 867,890 | 942,091 |
Accumulated deficit | (157,832) | (211,895) |
Accumulated other comprehensive income (loss) | (527) | 167 |
Total stockholders’ equity | 709,576 | 730,408 |
Total liabilities and stockholders’ equity | $ 1,891,476 | $ 2,075,353 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 250,000,000 | 250,000,000 |
Common stock, shares issued (in shares) | 45,064,459 | 44,734,308 |
Common stock, shares outstanding (in shares) | 45,064,459 | 44,734,308 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Revenues: | ||
Total net product sales | $ 157,991 | $ 119,027 |
Operating expenses: | ||
Cost of goods sold | 36,074 | 31,349 |
Research and development | 21,605 | 15,879 |
Selling, general and administrative | 64,260 | 48,522 |
Amortization of acquired intangible assets | 14,322 | 1,967 |
Acquisition-related charges, product discontinuation and other | 4,337 | 1,873 |
Total operating expenses | 140,598 | 99,590 |
Income from operations | 17,393 | 19,437 |
Other (expense) income: | ||
Interest income | 271 | 415 |
Interest expense | (10,246) | (6,971) |
Other, net | (124) | (157) |
Total other expense, net | (10,099) | (6,713) |
Income before income taxes | 7,294 | 12,724 |
Income tax expense | (466) | (2,355) |
Net income | $ 6,828 | $ 10,369 |
Net income per share: | ||
Basic net income per common share (in USD per share) | $ 0.15 | $ 0.24 |
Diluted net income per common share (in USD per share) | $ 0.15 | $ 0.23 |
Weighted average common shares outstanding: | ||
Basic (in shares) | 44,869 | 43,833 |
Diluted (in shares) | 46,438 | 45,966 |
Net product sales | ||
Revenues: | ||
Total net product sales | $ 157,422 | $ 118,738 |
Royalty revenue | ||
Revenues: | ||
Total net product sales | $ 569 | $ 289 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 6,828 | $ 10,369 |
Other comprehensive income (loss): | ||
Net unrealized loss on investments, net of tax | (733) | (150) |
Foreign currency translation adjustments | 39 | 4 |
Total other comprehensive loss | (694) | (146) |
Comprehensive income | $ 6,134 | $ 10,223 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Common Stock | Additional Paid-In Capital | Additional Paid-In CapitalCumulative Effect, Period of Adoption, Adjustment | Accumulated Deficit | Accumulated DeficitCumulative Effect, Period of Adoption, Adjustment | Accumulated Other Comprehensive Income (Loss) |
Beginning balance (in shares) at Dec. 31, 2020 | 43,637,000 | |||||||
Balance at beginning of period at Dec. 31, 2020 | $ 619,688 | $ 44 | $ 873,201 | $ (253,875) | $ 318 | |||
Increase (Decrease) in Stockholders' Equity | ||||||||
Exercise of stock options (in shares) | 317,000 | |||||||
Exercise of stock options | 10,797 | $ 0 | 10,797 | |||||
Vested restricted stock units (in shares) | 4,000 | |||||||
Stock-based compensation | 10,110 | 10,110 | ||||||
Other comprehensive loss (Note 11) | (146) | (146) | ||||||
Net income | 10,369 | 10,369 | ||||||
Ending balance (in shares) at Mar. 31, 2021 | 43,958,000 | |||||||
Balance at end of period at Mar. 31, 2021 | 650,818 | $ 44 | 894,108 | (243,506) | 172 | |||
Beginning balance (in shares) at Dec. 31, 2021 | 44,734,000 | |||||||
Balance at beginning of period at Dec. 31, 2021 | $ 730,408 | $ (49,233) | $ 45 | 942,091 | $ (96,468) | (211,895) | $ 47,235 | 167 |
Increase (Decrease) in Stockholders' Equity | ||||||||
Exercise of stock options (in shares) | 323,201 | 323,000 | ||||||
Exercise of stock options | $ 11,078 | 11,078 | ||||||
Vested restricted stock units (in shares) | 7,000 | |||||||
Stock-based compensation | 11,189 | 11,189 | ||||||
Other comprehensive loss (Note 11) | (694) | (694) | ||||||
Net income | 6,828 | 6,828 | ||||||
Ending balance (in shares) at Mar. 31, 2022 | 45,064,000 | |||||||
Balance at end of period at Mar. 31, 2022 | $ 709,576 | $ 45 | $ 867,890 | $ (157,832) | $ (527) | |||
Increase (Decrease) in Stockholders' Equity | ||||||||
Reclassification of the equity components of convertible senior notes to liability upon adoption of Accounting Standards Update 2020-06 (Note 2) | Accounting Standards Update 2020-06 Retrospective [Member] |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Operating activities: | ||
Net income | $ 6,828 | $ 10,369 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Deferred taxes | 29 | 1,746 |
Depreciation of fixed assets and amortization of intangible assets | 20,033 | 4,851 |
Amortization of debt issuance costs | 1,179 | 651 |
Amortization of debt discount | 706 | 5,657 |
Loss (gain) on disposal of fixed assets | 9 | (11) |
Stock-based compensation | 11,189 | 10,110 |
Changes in contingent consideration | (1,071) | (1,127) |
Loss on investment | 18 | 155 |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | 4,215 | 462 |
Inventories, net | (5,112) | 43 |
Prepaid expenses and other assets | (4,260) | 254 |
Accounts payable | 6,105 | (1,351) |
Accrued expenses and income taxes payable | (9,161) | (18,027) |
Other liabilities | 70 | (1,701) |
Net cash provided by operating activities | 30,777 | 12,081 |
Investing activities: | ||
Purchases of fixed assets | (7,668) | (13,073) |
Purchases of available-for-sale investments | (155,601) | (186,653) |
Sales of available-for-sale investments | 0 | 145,282 |
Payment of contingent consideration | (32,000) | 0 |
Purchases of equity and debt investments | (12,750) | (1,220) |
Net cash used in investing activities | (208,019) | (55,664) |
Financing activities: | ||
Proceeds from exercises of stock options | 11,024 | 10,325 |
Repayment of 2024 convertible senior notes | (192,609) | 0 |
Net cash provided by (used in) financing activities | (181,585) | 10,325 |
Net decrease in cash and cash equivalents | (358,827) | (33,258) |
Cash and cash equivalents, beginning of period | 585,578 | 99,957 |
Cash and cash equivalents, end of period | 226,751 | 66,699 |
Supplemental cash flow information: | ||
Cash paid for interest | 9,967 | 1,686 |
Cash paid for income taxes, net of refunds | 9 | 1 |
Non-cash investing and financing activities: | ||
Fixed assets included in accounts payable and accrued liabilities | $ 6,244 | $ 7,033 |
DESCRIPTION OF BUSINESS
DESCRIPTION OF BUSINESS | 3 Months Ended |
Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
DESCRIPTION OF BUSINESS | DESCRIPTION OF BUSINESS Pacira BioSciences, Inc. and its subsidiaries (collectively, the “Company” or “Pacira”) is the industry leader in its commitment to non-opioid pain management and providing a non-opioid option to as many patients as possible to redefine the role of opioids as rescue therapy only. The Company’s long-acting, local analgesic, EXPAREL ® (bupivacaine liposome injectable suspension), was commercially launched in the United States, or U.S., in April 2012 and approved in select European countries and the United Kingdom, or U.K. in November 2021. EXPAREL utilizes the Company’s proprietary multivesicular liposome drug delivery technology that encapsulates drugs without altering their molecular structure, and releases them over a desired period of time. In November 2021, the Company acquired Flexion Therapeutics, Inc., or Flexion, and added ZILRETTA ® (triamcinolone acetonide extended-release injectable suspension) to its product portfolio. ZILRETTA is the first and only extended-release, intra-articular (meaning in the joint) injection indicated for the management of osteoarthritis, or OA, knee pain. For more information, see Note 4, Flexion Acquisition . In April 2019, the Company added iovera° ® to its commercial offering with the acquisition of MyoScience, Inc., or MyoScience (the “MyoScience Acquisition”). The iovera° system is a handheld cryoanalgesia device used to deliver a precise, controlled application of cold temperature to only targeted nerves. Pacira is subject to risks common to companies in similar industries and stages, including, but not limited to, competition from larger companies, reliance on revenue from three products, reliance on a limited number of wholesalers, reliance on a limited number of manufacturing sites, new technological innovations, dependence on key personnel, reliance on third-party service providers and sole source suppliers, protection of proprietary technology, compliance with government regulations and risks related to cybersecurity. The Company is managed and operated as a single business focused on the development, manufacture, marketing, distribution and sale of non-opioid pain management and regenerative health solutions. The Company is managed by a single management team, and consistent with its organizational structure, the Chief Executive Officer and Chairman manages and allocates resources at a consolidated level. Accordingly, the Company views its business as one reportable segment to evaluate performance, allocate resources, set operational targets and forecast its future financial results. Coronavirus (COVID-19) Pandemic Since early 2020, the Company’s revenues have been impacted by the global pandemic caused by a novel strain of coronavirus (COVID-19) and pandemic-related challenges that included the significant postponement or suspension in the scheduling of elective surgical procedures due to public health guidance and government directives. While the degree of impact has diminished during the course of the pandemic due to the introduction of vaccines and therapeutics, as well as the lessening of elective surgery restrictions, certain pandemic-related operational and staffing challenges persist. For instance, while many restrictions have since eased with COVID-19 vaccines now widely available, the elective surgery market faced additional pandemic-related challenges in August and September 2021 due to regional surges in COVID-19 variant cases, staffing shortages and fatigue from care teams addressing significant procedure backlogs, and in December 2021, the COVID-19 Omicron variant prompted some government restrictions on elective surgical procedures and created surgical staffing challenges, both of which began to ease in January 2022. The Company’s manufacturing sites are operational and have safety protocols and guidelines as recommended by federal, state and local governments. Indirect effects of the pandemic may include longer lead-times for or the inability to secure a sufficient supply of materials due to the prioritization by certain suppliers for COVID-19 vaccine manufacturing. The situation remains dynamic and subject to rapid and possibly material changes. Additional negative impacts may also arise from the COVID-19 pandemic that the Company is unable to foresee. The nature and extent of such impacts will depend on future developments, which are highly uncertain and cannot be predicted. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Consolidation These interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America, or GAAP, and in accordance with the rules and regulations of the United States Securities and Exchange Commission (SEC), for interim reporting. Pursuant to these rules and regulations, certain information and footnote disclosures normally included in complete annual financial statements have been condensed or omitted. Therefore, these interim condensed consolidated financial statements should be read in conjunction with the audited annual consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 . The condensed consolidated financial statements at March 31, 2022, and for the three-month periods ended March 31, 2022 and 2021, are unaudited, but include all adjustments (consisting of only normal recurring adjustments) which, in the opinion of management, are necessary to present fairly the financial information set forth herein in accordance with GAAP. The condensed consolidated balance sheet at December 31, 2021 is derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. The condensed consolidated financial statements as presented reflect certain reclassifications from previously issued financial statements to conform to the current year presentation. The accounts of wholly-owned subsidiaries are included in the condensed consolidated financial statements. Intercompany accounts and transactions have been eliminated in consolidation. The results of operations for these interim periods are not necessarily indicative of results that may be expected for any other interim periods or for the full year. Concentration of Major Customers The Company sells EXPAREL through a drop-ship program under which orders are processed through wholesalers (including AmerisourceBergen Health Corporation, Cardinal Health, Inc. and McKesson Drug Company), but shipments of the product are sent directly to individual accounts, such as hospitals, ambulatory surgery centers and individual doctors. The Company also sells EXPAREL directly to ambulatory surgery centers and physicians. The Company sells ZILRETTA primarily to specialty distributors and a specialty pharmacy, who then subsequently resell ZILRETTA to physicians, clinics and certain medical centers or hospitals. The Company also contracts directly with healthcare providers and intermediaries such as Group Purchasing Organizations, or GPOs. The Company sells iovera° directly to end users and its bupivacaine liposome injectable suspension for veterinary use to a third-party licensee in the U.S. The table below includes the percentage of revenues comprised by the Company’s three largest wholesalers in each period presented: Three Months Ended 2022 2021 Largest wholesaler 31% 32% Second largest wholesaler 23% 29% Third largest wholesaler 22% 27% Total 76% 88% The percentage of revenues from the Company’s three largest wholesalers have shifted in the current year with the integration of ZILRETTA sales in 2022. Recently Adopted Accounting Pronouncements In August 2020, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40), |
REVENUE
REVENUE | 3 Months Ended |
Mar. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE | REVENUE Revenue from Contracts with Customers The Company’s net product sales consist of (i) EXPAREL in the U.S., the European Union, or E.U., and the U.K.; (ii) ZILRETTA in the U.S.; (iii) iovera° in the U.S., Canada and the E.U. and (iv) sales of, and royalties on, its bupivacaine liposome injectable suspension for veterinary use. Royalty revenues are from the Company’s collaborative licensing agreements. The Company does not consider revenue from sources other than sales of EXPAREL and ZILRETTA to be material sources of its consolidated revenue. As such, the following disclosure only relates to revenue associated with net EXPAREL and ZILRETTA product sales. Net Product Sales The Company sells EXPAREL through a drop-ship program under which orders are processed through wholesalers based on orders of the product placed by end-users, namely hospitals, ambulatory surgery centers and healthcare provider offices. EXPAREL is delivered directly to the end-user without the wholesaler ever taking physical possession of the product. The Company primarily sells ZILRETTA to specialty distributors and a specialty pharmacy, who then subsequently resell ZILRETTA to physicians, clinics and certain medical centers or hospitals. The Company also contracts directly with healthcare providers and intermediaries such as GPOs. Product revenue is recognized when control of the promised goods are transferred to the customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for transferring those goods. EXPAREL and ZILRETTA revenue is recorded at the time the product is transferred to the customer. Revenues from sales of products are recorded net of returns allowances, prompt payment discounts, service fees, government rebates, volume rebates and chargebacks. These reserves are based on estimates of the amounts earned or to be claimed on the related sales. These amounts are treated as variable consideration, estimated and recognized as a reduction of the transaction price at the time of the sale, using the most likely amount method, except for returns, which is based on the expected value method. The Company includes these estimated amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized for such transaction will not occur, or when the uncertainty associated with the variable consideration is resolved. The calculation of some of these items requires management to make estimates based on sales data, historical return data, contracts, statutory requirements and other related information that may become known in the future. Accounts Receivable The majority of accounts receivable arise from product sales and represent amounts due from wholesalers, hospitals, ambulatory surgery centers, specialty distributors, specialty pharmacy, Group Purchasing Organizations and doctors. Payment terms generally range from zero Performance Obligations A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account in Accounting Standards Codification, or ASC, 606. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. At contract inception, the Company assesses the goods promised in its contracts with customers and identifies a performance obligation for each promise to transfer to the customer a good that is distinct. When identifying individual performance obligations, the Company considers all goods promised in the contract regardless of whether explicitly stated in the customer contract or implied by customary business practices. The Company’s contracts with customers require it to transfer an individual distinct product, which represents a single performance obligation. The Company’s performance obligation with respect to its product sales is satisfied at a point in time, which transfers control upon delivery of EXPAREL and ZILRETTA to its customers. The Company considers control to have transferred upon delivery because the customer has legal title to the asset, physical possession of the asset has been transferred, the customer has significant risks and rewards of ownership of the asset, and the Company has a present right to payment at that time. Disaggregated Revenue The following table represents disaggregated net product sales in the periods presented as follows (in thousands): Three Months Ended 2022 2021 Net product sales: EXPAREL $ 129,205 $ 114,678 ZILRETTA 23,635 — iovera° 3,026 3,268 Bupivacaine liposome injectable suspension 1,556 792 Total net product sales $ 157,422 $ 118,738 |
FLEXION ACQUISITION
FLEXION ACQUISITION | 3 Months Ended |
Mar. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
FLEXION ACQUISITION | FLEXION ACQUISITION On November 19, 2021, the Company acquired Flexion (the “Flexion Acquisition”), a biopharmaceutical company focused on the discovery, development, and commercialization of novel, local therapies for the treatment of patients with musculoskeletal conditions, beginning with osteoarthritis, the most common form of arthritis. Upon consummation of the Flexion Acquisition, Flexion became a wholly-owned subsidiary of the Company and was renamed Pacira Therapeutics, Inc. The total consideration for the Flexion Acquisition was approximately $578.8 million consisting of: (i) $448.5 million of cash paid to former Flexion stockholders and to settle restricted stock units and in-the-money stock options; (ii) an $85.1 million cash payment to repay Flexion debt that was not assumed by the Company and (iii) $45.2 million of estimated contingent consideration related to contingent value rights, or CVRs, that were issued to Flexion shareholders and certain equity award holders in conjunction with the Flexion Acquisition. The consideration is subject to adjustments based on the achievement of certain potential milestone payments. Up to an additional $380.2 million in the aggregate may be payable to holders of the CVRs if each of the applicable milestones are achieved. The Company is finalizing its valuation of intangible assets, liabilities and tax analyses, and anticipates finalizing the purchase price allocation as the information necessary to complete the analysis is obtained, but no later than one year after the acquisition date. The following table sets forth the preliminary allocation of the Flexion Acquisition purchase price to the estimated fair value of the net assets acquired at the acquisition date (in thousands): Amounts Recognized at the Acquisition Date (as previously reported) (a) Measurement Period Adjustments (b) Amounts Recognized at the Acquisition Date ASSETS ACQUIRED Cash and cash equivalents $ 113,562 $ — $ 113,562 Short-term available-for-sale investments 11,153 — 11,153 Accounts receivable 32,838 — 32,838 Inventories 29,667 — 29,667 Prepaid expenses and other assets 4,852 — 4,852 Fixed assets 23,307 — 23,307 Deferred tax assets 58,015 — 58,015 Right-of-use assets 6,585 — 6,585 Identifiable intangible assets 480,000 — 480,000 In-process research and development (IPR&D) 61,000 — 61,000 Total assets $ 820,979 $ — $ 820,979 LIABILITIES ASSUMED Accounts payable $ 9,794 $ — $ 9,794 Accrued expenses 22,746 547 23,293 Deferred revenue 10,000 — 10,000 Lease liabilities 6,585 — 6,585 Other liabilities 1,187 — 1,187 Long-term debt 201,450 — 201,450 Total liabilities 251,762 547 252,309 Total identifiable net assets acquired 569,217 (547) 568,670 Goodwill 9,628 547 10,175 Total consideration transferred $ 578,845 $ — $ 578,845 (a) As previously reported in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. (b) Represents pre-acquisition expenses that were paid by the Company in 2022. Unaudited Pro Forma Summary of Operations The following table shows the unaudited pro forma summary of operations for the three months ended March 31, 2021, as if the Flexion Acquisition had occurred on January 1, 2020. This pro forma information does not purport to represent what the Company’s actual results would have been if the Flexion Acquisition had occurred as of January 1, 2020, and is not indicative of what such results would be expected for any future period (in thousands, except per share amounts): Three Months Ended Total revenues $ 143,616 Net loss $ (17,120) Pro forma basic and diluted net loss per share $ (0.39) The unaudited pro forma financial information was prepared using the acquisition method of accounting and was based on the historical financial information of the Company and Flexion. The summary pro forma financial information primarily reflects the following pro forma adjustments: • Recognition of the income tax benefit resulting from decreasing Flexion’s existing valuation allowance on deferred tax assets for the three months ended March 31, 2021; • Removal of Flexion’s interest expense and associated deferred financing cost amortization related to the $85.1 million of debt not assumed; • Adjustments to the Company’s interest income for the cash used to acquire Flexion; • Additional cost of goods sold related to a step-up value in inventory; • Additional amortization expense from the acquired developed technology intangible assets; • Additional depreciation of Flexion’s fixed assets; and • Additional lease expense on Flexion’s right-of-use, or ROU, assets. In addition, all of the above adjustments were adjusted for the applicable tax impact. |
INVENTORIES
INVENTORIES | 3 Months Ended |
Mar. 31, 2022 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | INVENTORIES The components of inventories, net are as follows (in thousands): March 31, December 31, 2022 2021 Raw materials $ 35,297 $ 36,337 Work-in-process 33,995 35,182 Finished goods 34,370 27,031 Total $ 103,662 $ 98,550 |
FIXED ASSETS
FIXED ASSETS | 3 Months Ended |
Mar. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
FIXED ASSETS | FIXED ASSETS Fixed assets, net, summarized by major category, consist of the following (in thousands): March 31, December 31, 2022 2021 Machinery and equipment $ 117,167 $ 117,264 Leasehold improvements 59,743 59,740 Computer equipment and software 13,207 13,197 Office furniture and equipment 2,914 2,883 Construction in progress 87,457 80,557 Total 280,488 273,641 Less: accumulated depreciation (90,721) (85,240) Fixed assets, net $ 189,767 $ 188,401 For the three months ended March 31, 2022 and 2021, depreciation expense was $5.7 million and $2.9 million, respectively. For the three months ended March 31, 2022 and 2021, there was $0.8 million and $1.0 million of capitalized interest on the construction of manufacturing sites, respectively. At March 31, 2022 and December 31, 2021, total fixed assets, net includes leasehold improvements and manufacturing process equipment located in Europe in the amount of $62.8 million and $65.4 million, respectively. As of March 31, 2022 and December 31, 2021, the Company had asset retirement obligations of $3.0 million and $2.4 million, respectively, included in accrued expenses and other liabilities on its condensed consolidated balance sheet, for costs associated with returning leased spaces to their original condition upon the termination of certain lease agreements. |
LEASES
LEASES | 3 Months Ended |
Mar. 31, 2022 | |
Leases [Abstract] | |
LEASES | LEASES The Company leases all of its facilities, including its EXPAREL manufacturing facility in San Diego, California and its iovera° manufacturing facility in Fremont, California. These leases have remaining terms up to 8.4 years, some of which provide renewal options at the then-current market value. The Company also has two embedded leases with Thermo Fisher Scientific Pharma Services for the use of their manufacturing facility in Swindon, England for the production of EXPAREL and ZILRETTA. A portion of the associated monthly base fees has been allocated to the lease components based on a relative fair value basis. The operating lease costs for the facilities include lease and non-lease components, such as common area maintenance and other common operating expenses, along with executory costs such as insurance and real estate taxes. Total operating lease costs are as follows (in thousands): Three Months Ended March 31, 2022 2021 Fixed lease costs $ 3,527 $ 2,922 Variable lease costs 472 478 Total $ 3,999 $ 3,400 Supplemental cash flow information related to operating leases is as follows (in thousands): Three Months Ended March 31, 2022 2021 Cash paid for operating lease liabilities, net of lease incentive $ 3,279 $ 4,600 ROU assets recorded in exchange for lease obligations $ 16 $ — The Company has elected to net the amortization of the ROU asset and the reduction of the lease liability principal in other liabilities in the condensed consolidated statement of cash flows. The Company has measured its operating lease liabilities at an estimated discount rate at which it could borrow on a collateralized basis over the remaining term for each operating lease. The weighted average remaining lease term and the weighted average discount rate are summarized as follows: March 31, 2022 2021 Weighted average remaining lease term 7.55 years 8.95 years Weighted average discount rate 6.95 % 6.89 % Maturities of the Company’s operating lease liabilities are as follows (in thousands): Year Aggregate Minimum Payments Due 2022 (remaining nine months) $ 9,867 2023 13,304 2024 13,435 2025 12,575 2026 12,310 Thereafter 39,423 Total future lease payments 100,914 Less: imputed interest (23,186) Total operating lease liabilities $ 77,728 As of March 31, 2022, the Company has entered into one lease agreement not included above as the Company has not yet taken possession of the property. When the lease commences, the future lease obligations will be as follows (in thousands): Year Aggregate Minimum Payments Due 2022 (remaining nine months) $ 239 2023 410 2024 416 2025 419 2026 425 Thereafter 179 Total future lease payments $ 2,088 Additionally, in April 2022, the Company entered into an agreement to sublease the former Flexion research and development laboratory in Woburn, Massachusetts. As of March 31, 2022, the associated ROU asset is $0.4 million, in which future cash to be received under this sublease agreement is expected to exceed the ROU asset by $0.1 million. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | GOODWILL AND INTANGIBLE ASSETS Goodwill The Company’s goodwill results from the acquisition of Pacira Pharmaceuticals, Inc. (the Company’s California operating subsidiary) from SkyePharma Holding, Inc., or Skyepharma, (now a subsidiary of Vectura Group plc) in March 2007 (the “Skyepharma Acquisition”), MyoScience, Inc., or MyoScience, (the “MyoScience Acquisition”) in April 2019 and the Flexion Acquisition in November 2021. The balances at March 31, 2022 and December 31, 2021 were $145.7 million and $145.2 million, respectively. The increase was due to a measurement period adjustment associated with the Flexion Acquisition. See Note 4, Flexion Acquisition, for more information. The Skyepharma Acquisition occurred in March 2007, prior to the requirements to record contingent consideration at fair value under ASC 805-30. In connection with the Skyepharma Acquisition, the Company agreed to certain milestone payments for DepoBupivacaine products, including EXPAREL. The final Skyepharma milestone payment of $32.0 million when annual net sales collected reached $500.0 million was achieved in the fourth quarter of 2021 and paid during the first quarter of 2022. Intangible Assets Intangible assets, net, consist of the in-process research and development, or IPR&D, and developed technology from the Flexion Acquisition and developed technology and customer relationships from the MyoScience Acquisition and are summarized as follows (dollar amounts in thousands): March 31, 2022 Gross Carrying Value Accumulated Intangible Weighted-Average Useful Lives Developed technologies $ 590,000 $ (41,417) $ 548,583 10 years, 5 months Customer relationships 90 (27) 63 10 years Total finite-lived intangible assets, net 590,090 (41,444) 548,646 Acquired IPR&D 61,000 — 61,000 Total intangible assets, net $ 651,090 $ (41,444) $ 609,646 December 31, 2021 Gross Carrying Value Accumulated Intangible Weighted-Average Useful Lives Developed technologies $ 590,000 $ (27,097) $ 562,903 10 years, 5 months Customer relationships 90 (25) 65 10 years Total finite-lived intangible assets, net 590,090 (27,122) 562,968 Acquired IPR&D 61,000 — 61,000 Total intangible assets, net $ 651,090 $ (27,122) $ 623,968 Amortization expense was $14.3 million and $2.0 million for the three months ended March 31, 2022 and 2021, respectively. The increase in amortization expense is a result of the amortization of ZILRETTA for osteoarthritis knee pain acquired as part of the Flexion Acquisition in November 2021. Assuming no changes in the gross carrying amount of these intangible assets, the future estimated amortization expense on the finite-lived intangible assets will be $43.0 million for the remaining nine months of 2022, $57.3 million from 2023 to 2030, $37.4 million in 2031, $7.9 million in 2032 and $2.2 million in 2033. |
DEBT
DEBT | 3 Months Ended |
Mar. 31, 2022 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT The carrying value of the Company’s outstanding debt is summarized as follows (in thousands): March 31, December 31, 2022 2021 Term loan B facility maturing December 2026 $ 360,508 $ 359,497 0.750% Convertible senior notes due August 2025 394,275 330,627 3.375% Convertible senior notes due May 2024 8,640 201,249 2.375% Convertible senior notes due April 2022 (1) 160,000 157,857 Total $ 923,423 $ 1,049,230 (1) The 2022 Notes (as defined below) matured on April 1, 2022. Term Loan B Facility In December 2021, the Company entered into a term loan credit agreement (the “Credit Agreement”) with JP Morgan Chase Bank, N.A., as administrative agent and the initial lender. The term loan issued under the Credit Agreement (the “Term Loan”) was issued at a 3% discount and allows for a single-advance term loan B facility in the principal amount of $375.0 million, which is secured by substantially all of the Company’s and each subsidiary guarantor’s assets. Subject to certain conditions, the Company may, at any time, on one or more occasion, add one or more new classes of term facilities and/or increase the principal amount of the loans of any existing class by requesting one or more incremental term facilities. The net proceeds of the Term Loan were approximately $363.8 million after deducting an original issue discount of $11.2 million. The total debt composition of the Term Loan is as follows (in thousands): March 31, December 31, 2022 2021 Term Loan maturing December 2026 $ 375,000 $ 375,000 Deferred financing costs (4,138) (4,443) Discount on debt (10,354) (11,060) Total debt, net of debt discount and deferred financing costs $ 360,508 $ 359,497 The Term Loan matures on December 7, 2026 and requires quarterly repayments of principal in the amount of $9.4 million commencing June 30, 2022, increasing to $14.1 million commencing December 31, 2025, with a remaining balloon payment of approximately $188.0 million due at maturity. During 2022, the Company will be required to make three quarterly payments totaling $28.1 million. The Company is also required to make mandatory prepayments of principal from (i) the Company’s excess cash flow (as defined in the Credit Agreement) existing in any fiscal year and if the Senior Secured Leverage Ratio (as defined in the Credit Agreement) for such fiscal year exceeds certain predetermined limits (ii) net proceeds (as defined in the Credit Agreement) of non-ordinary course assets sales and casualty events and (iii) debt issuance proceeds (other than permitted debt under the Credit Agreement). Prepayment penalties for the Term Loan are 2% in the first loan year plus an interest make-whole payment, 2% in the second loan year, 1% in the third loan year and nothing thereafter. Prepayment penalties generally do not apply to mandatory prepayment obligations under the Credit Agreement, such as prepayments due in connection with excess cash flow. The Term Loan requires the Company to, among other things, maintain (i) a first lien net leverage ratio, determined as of the last day of any fiscal quarter, of no greater than 1.75 to 1.00 and (ii) liquidity, at any time, of at least $150.0 million. The Term Loan also contains customary affirmative and negative covenants, financial covenants, representations and warranties, events of default and other provisions. As of March 31, 2022, the Company was in compliance with all financial covenants under the Credit Agreement. The Company may elect to borrow either term benchmark borrowings or alternate base rate borrowings. Term benchmark borrowings bear interest at a variable rate per annum equal to the Adjusted Term SOFR Rate (as defined in the Credit Agreement) (subject to a 75 basis points floor) plus an applicable margin of 700 basis points. Alternate base rate borrowings bear interest at a variable rate per annum determined using a base rate (subject to a 175 basis points floor) equal to the greatest of (i) the Prime Rate (as defined in the Credit Agreement) in effect on such day, (ii) the NYFRB Rate (as defined in the Credit Agreement) plus 50 basis points or (iii) the Adjusted Term SOFR Rate (as defined in the Credit Agreement) plus 100 basis points, subject to certain exceptions, plus an applicable margin of 600 basis points. As of March 31, 2022, borrowings under the Term Loan consisted entirely of term benchmark borrowings at a rate of 7.75%. Convertible Senior Notes Due 2025 In July 2020, the Company completed a private placement of $402.5 million in aggregate principal amount of its 0.750% convertible senior notes due 2025, or 2025 Notes, and entered into an indenture, or 2025 Indenture, with respect to the 2025 Notes. The 2025 Notes accrue interest at a fixed rate of 0.750% per year, payable semiannually in arrears on February 1 st and August 1 st of each year. The 2025 Notes mature on August 1, 2025. The total debt composition of the 2025 Notes is as follows (in thousands): March 31, December 31, 2022 2021 0.750% convertible senior notes due August 2025 $ 402,500 $ 402,500 Deferred financing costs (8,225) (7,155) Discount on debt — (64,718) Total debt, net of debt discount and deferred financing costs $ 394,275 $ 330,627 The net proceeds from the issuance of the 2025 Notes were approximately $390.0 million, after deducting commissions and the offering expenses paid by the Company. A portion of the net proceeds from the 2025 Notes was used by the Company to repurchase $185.0 million in aggregate principal amount of its then-outstanding 2.375% convertible senior notes due 2022 in privately-negotiated transactions for a total of $211.1 million of cash (including accrued interest). Holders may convert the 2025 Notes at any time prior to February 3, 2025, only if certain circumstances are met, including if during the previous calendar quarter, the last reported sales price of the Company’s common stock was greater than 130% of the conversion price then applicable for at least 20 out of the last 30 consecutive trading days of the quarter. During the quarter ended March 31, 2022, this condition for conversion was not met. On or after February 3, 2025, until the close of business on the second scheduled trading day immediately preceding August 1, 2025, holders may convert their 2025 Notes at any time. Upon conversion, holders will receive the principal amount of their 2025 Notes and any excess conversion value, calculated based on the per share volume-weighted average price for each of the 40 consecutive trading days during the observation period (as more fully described in the 2025 Indenture). For both the principal and excess conversion value, holders may receive cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, at the Company’s option. The initial conversion rate for the 2025 Notes is 13.9324 shares of common stock per $1,000 principal amount, which is equivalent to an initial conversion price of $71.78 per share of the Company’s common stock. The conversion rate will be subject to adjustment in some events but will not be adjusted for any accrued and unpaid interest. The initial conversion price of the 2025 Notes represents a premium of approximately 32.5% to the closing sale price of $54.17 per share of the Company’s common stock on the Nasdaq Global Select Market on July 7, 2020, the date that the Company priced the private offering of the 2025 Notes. As of March 31, 2022, the 2025 Notes had a market price o f $1,241 pe r $1,000 principal amount. In the event of conversion, holders would forgo all future interest payments, any unpaid accrued interest and the possibility of further stock price appreciation. Upon the receipt of conversion requests, the settlement of the 2025 Notes will be paid pursuant to the terms of the 2025 Indenture. In the event that all of the 2025 Notes are converted, the Company would be required to repay the $402.5 million in principal value and any conversion premium in any combination of cash and shares of its common stock (at the Company’s option). Prior to August 1, 2023, the Company may not redeem the 2025 Notes. On or after August 1, 2023 (but, in the case of a redemption of less than all of the outstanding 2025 Notes, no later than the 40 th scheduled trading day immediately before the maturity date), the Company may redeem for cash all or part of the 2025 Notes if the last reported sale price (as defined in the 2025 Indenture) of the Company’s common stock has been at least 130% of the conversion price then in effect for (i) each of at least 20 trading days (whether or not consecutive) during any 30 consecutive trading days ending on, and including, the trading day immediately before the date the Company sends the related notice of redemption and (ii) the trading day immediately before the date the Company sends such notice. The redemption price will equal the sum of (i) 100% of the principal amount of the 2025 Notes being redeemed, plus (ii) accrued and unpaid interest, including additional interest, if any, to, but excluding, the redemption date. In addition, calling the 2025 Notes for redemption will constitute a “make-whole fundamental change” (as defined in the 2025 Indenture) and will, in certain circumstances, increase the conversion rate applicable to the conversion of such notes if it is converted in connection with the redemption. No sinking fund is provided for the 2025 Notes. While the 2025 Notes are currently classified on the Company’s condensed consolidated balance sheet at March 31, 2022 as long-term debt, the future convertibility and resulting balance sheet classification of this liability is monitored at each quarterly reporting date and is analyzed dependent upon market prices of the Company’s common stock during the prescribed measurement periods. In the event that the holders of the 2025 Notes have the election to convert the 2025 Notes at any time during the prescribed measurement period, the 2025 Notes would then be considered a current obligation and classified as such. Convertible Senior Notes Due 2024 Assumed from the Flexion Acquisition Prior to the Flexion Acquisition, on May 2, 2017, Flexion issued an aggregate of $201.3 million principal amount of 3.375% convertible senior notes due 2024 (the “Flexion 2024 Notes”), pursuant to the indenture, dated as of May 2, 2017 (the “Original Flexion Indenture”), between Flexion and Wells Fargo Bank, N.A., as trustee (the “Flexion Trustee”), as supplemented by the First Supplemental Indenture, dated as of November 19, 2021, between Flexion and the Flexion Trustee (the “First Supplemental Flexion Indenture” and, together with the Original Flexion Indenture, the “Flexion Indenture”). The Flexion 2024 Notes have a maturity date of May 1, 2024, are unsecured, and accrue interest at a rate of 3.375% per annum, payable semi-annually on May 1 and November 1 of each year. Upon the Flexion Acquisition, the principal was assumed and recorded at fair value by the Company. Upon conversion of the Flexion 2024 Notes, at the election of each holder thereof, each Flexion 2024 Note was convertible into cash, shares of Flexion’s common stock, or a combination thereof, at Flexion’s election, at a conversion rate of approximately 37.3413 shares of Flexion common stock per $1,000 principal amount of the Flexion 2024 Notes, which corresponded to an initial conversion price of approximately $26.78 per share of Flexion’s common stock. As a result of the Flexion Acquisition, and in connection with the Notice (as defined below), holders of the Flexion 2024 Notes became entitled to certain Flexion Acquisition-related conversion and repurchase rights, as discussed below. In addition, as a result of the Flexion Acquisition and as discussed in more detail below, any future conversion rights are subject to the occurrence of any future events giving rise to such conversion rights under the Flexion Indenture. On December 6, 2021, as a result of the Flexion Acquisition and in accordance with the Flexion Indenture, Flexion provided a Fundamental Change Company Notice and Offer to Purchase (the “Notice”) to the holders of the Flexion 2024 Notes and offered to repurchase for cash all of the outstanding Flexion 2024 Notes, at a repurchase price in cash equal to 100% of the principal amount of the Flexion 2024 Notes being repurchased, plus accrued and unpaid interest thereon to, but excluding, January 7, 2022, subject to the terms and conditions set forth therein. The offer to purchase expired at 5:00 p.m., New York City time, on January 6, 2022, as scheduled. Any holder that did not exercise its repurchase right in accordance with the terms of the Notice retained the conversion rights associated with such holder’s Flexion 2024 Notes under the Flexion Indenture. For conversion of Flexion 2024 Notes in connection with the Fundamental Change and the Make-Whole Fundamental Change (each as defined in the Flexion Indenture) resulting from the Flexion Acquisition, each $1,000 principal amount of the Flexion 2024 Notes was convertible into (i) $317.40 in cash and (ii) 37.3413 CVRs, based on the conversion rate of 37.3413, prior to 5:00 p.m., New York City time, on January 7, 2022. Alternatively, holders could retain their Flexion 2024 Notes and such Flexion 2024 Notes would remain outstanding subject to their existing terms, including with respect to a holder’s right to receive interest payments on the Flexion 2024 Notes and exercise any future conversion rights that may arise under the Flexion Indenture. On January 7, 2022, following the expiration of the offer to purchase, the Company accepted the $192.6 million aggregate principal amount of Flexion 2024 Notes that were validly tendered (and not validly withdrawn). No Flexion 2024 Notes were converted in connection with the Notice. At March 31, 2022, the remaining principal outstanding is $8.6 million. Convertible Senior Notes Due 2022 In March 2017, the Company completed a private placement of $345.0 million in aggregate principal amount of 2.375% convertible senior notes due 2022, or 2022 Notes. The 2022 Notes accrued interest at a fixed rate of 2.375% per year, payable semiannually in arrears on April 1 st and October 1 st of each year. As discussed above, in July 2020, the Company used part of the net proceeds from the issuance of the 2025 Notes to repurchase $185.0 million aggregate principal amount of the 2022 Notes in privately-negotiated transactions for an aggregate of $211.1 million in cash (including accrued interest). The total debt composition of the 2022 Notes is as follows (in thousands): March 31, December 31, 2022 2021 2.375% convertible senior notes due April 2022 $ 160,000 $ 160,000 Deferred financing costs — (223) Discount on debt — (1,920) Total debt, net of debt discount and deferred financing costs $ 160,000 $ 157,857 Subsequently, on April 1, 2022, the 2022 Notes matured, and the Company settled the remaining outstanding principal balance of $160.0 million and a conversion premium of $4.8 million through a cash payment of $156.9 million and the issuance of 101,521 shares of the Company’s common stock. Interest Expense The following table sets forth the total interest expense recognized in the periods presented (dollar amounts in thousands): Three Months Ended 2022 2021 Contractual interest expense $ 9,130 $ 1,705 Amortization of debt issuance costs 1,179 651 Amortization of debt discount 706 5,657 Capitalized interest and other (Note 6) (824) (1,042) Total $ 10,191 $ 6,971 Effective interest rate on total debt 5.58 % 6.70 % Upon the adoption of ASU 2020-06 effective January 1, 2022, the Company eliminated the convertible debt discounts associated with the 2022 Notes and the 2025 Notes that were originally recorded as offsets to the embedded conversion features recognized in equity. Effective January 1, 2022, the Company will not record interest expense on the previously recorded discounts on convertible debt. The deferred financing costs previously allocated to the conversion features have since been re-allocated to the outstanding debt, slightly increasing the future annual amortization of deferred financing costs. For additional information regarding the adoption of ASU 2020-06, see Note 2 , Summary of Significant Accounting Policies . |
FINANCIAL INSTRUMENTS
FINANCIAL INSTRUMENTS | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
FINANCIAL INSTRUMENTS | FINANCIAL INSTRUMENTS Fair Value Measurements Fair value is defined as the price that would be received to sell an asset or be paid to transfer a liability in the principal or most advantageous market in an orderly transaction. To increase consistency and comparability in fair value measurements, the FASB established a three-level hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of fair value measurements are: • Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. • Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data. • Level 3: Unobservable inputs that are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. The carrying value of financial instruments including cash and cash equivalents, accounts receivable and accounts payable approximate their respective fair values due to the short-term nature of these items. The fair value of the Company’s convertible senior notes are calculated utilizing market quotations from an over-the-counter trading market for these notes (Level 2). The fair value of the Company’s acquisition-related contingent consideration is reported at fair value on a recurring basis (Level 3). The carrying amounts of equity investments and convertible notes receivable without readily determinable fair values have not been adjusted for either an impairment or upward or downward adjustments based on observable transactions. At March 31, 2022, the carrying values and fair values of the following financial assets and liabilities were as follows (in thousands): Carrying Value Fair Value Measurements Using Level 1 Level 2 Level 3 Financial Assets and Financial Liabilities Measured at Fair Value on a Recurring Basis: Financial Assets: Equity investments $ 25,627 $ — $ — $ 25,627 Convertible notes receivable $ 5,364 $ — $ — $ 5,364 Financial Liabilities: Acquisition-related contingent consideration $ 56,527 $ — $ — $ 56,527 Financial Liabilities Measured at Amortized Cost: Term loan facility due December 2026 $ 360,508 $ — $ 371,250 $ — 0.750% convertible senior notes due 2025 (1) $ 394,275 $ — $ 499,603 $ — 3.375% convertible senior notes due 2024 (2) $ 8,640 $ — $ 8,662 $ — 2.375% convertible senior notes due 2022 (3) $ 160,000 $ — $ 163,600 $ — (1) The fair value of the 2025 Notes was based on the Company’s closing stock price of $76.32 per share at March 31, 2022 compared to a conversion price of $71.78 per share which, if converted, would result in an approximate conversion premium of 0.3 million shares or $25.5 million of cash. The maximum conversion premium that can be due on the 2025 Notes is 5.6 million shares, which assumes no increases in the conversion rate for certain corporate events. (2) Relates to the Flexion 2024 Notes. For more information, See Note 9, Debt . (3) The 2022 Notes matured on April 1, 2022. For more information, See Note 9, Debt . Equity and Convertible Note Investments The Company holds strategic investments in clinical and preclinical stage privately-held biotechnology companies in the form of equity and convertible note investments. The following investments have no readily determinable fair value and are recorded at cost minus impairment, if any, plus or minus observable price changes of identical or similar investments (in thousands): Equity Investments Convertible Notes Receivable Total Balance at December 31, 2021 $ 14,127 $ 4,132 $ 18,259 Purchases 11,500 1,250 12,750 Foreign currency adjustments — (18) (18) Balance at March 31, 2022 $ 25,627 $ 5,364 $ 30,991 Acquisition-Related Contingent Consideration The Company has recognized contingent consideration related to the Flexion Acquisition and the MyoScience Acquisition in the amount of $56.5 million and $57.6 million as of March 31, 2022 and December 31, 2021, respectively. The Company’s contingent consideration obligations are recorded at their estimated fair values and are revalued each reporting period if and until the related contingencies are resolved. The Company has measured the fair value of its contingent consideration using a probability-weighted discounted cash flow approach that is based on unobservable inputs and a Monte Carlo simulation. These inputs include, as applicable, estimated probabilities and the timing of achieving specified commercial and regulatory milestones, estimated forecasts of revenue and costs and the discount rates used to calculate the present value of estimated future payments. Significant changes may increase or decrease the probabilities of achieving the related commercial and regulatory events, shorten or lengthen the time required to achieve such events, or increase or decrease estimated forecasts. In November 2021, as part of the purchase price consideration related to the Flexion Acquisition, the Company recorded contingent consideration of $45.2 million, which represents the Company’s potential achievement of meeting regulatory and sales-based milestones. For the period from the date of the Flexion Acquisition through December 31, 2021, the Company recorded an additional $1.2 million liability due to an estimated $0.02 fair value increase to contingent consideration per CVR. During the three months ended March 31, 2022 , the Company recorded a $0.8 million credit due to a decrease in the fair value of contingent consideration. These adjustments were recorded as acquisition-related charges in the condensed consolidated statements of operations. At March 31, 2022, the weighted average discount rate was 12.6% and the weighted average probability of success for regulatory milestones was 11.7%. As of March 31, 2022 and December 31, 2021, a contingent consideration liability related to the Flexion Acquisition was recognized in the amount of $45.6 million and $46.4 million, respectively. In April 2019, the Company completed the MyoScience Acquisition pursuant to the terms of an Agreement and Plan of Merger, which provided for contingent milestone payments of up to an aggregate of $100.0 million upon the achievement of certain regulatory and commercial milestones. The Company’s obligation to make milestone payments is limited to those milestones achieved through December 31, 2023, and are to be paid within 60 days of the end of the fiscal quarter of achievement. As of March 31, 2022, the maximum potential remaining milestone payments to be paid are $43.0 million. The Company recognized contingent consideration credits of $0.3 million and $1.1 million during the three months ended March 31, 2022 and 2021, respectively . At March 31, 2022, the weighted average discount rate was 11.3% and the probability of success for the regulatory milestone that has not yet been met was 1.0%. As of March 31, 2022 and December 31, 2021, a contingent consideration liability related to the MyoScience Acquisition has been recognized in the amounts of $10.9 million and $11.2 million, respectively. The following table includes the key assumptions used in the valuation of the Company’s contingent consideration: Assumption Flexion Ranges Utilized as of March 31, 2022 MyoScience Ranges Utilized as of March 31, 2022 Discount rates 11.50% to 13.65% 10.23% to 12.28% Probabilities of payment for regulatory milestones 5% to 15% 1% Projected years of payment for regulatory and commercial milestones 2027 to 2030 2023 The change in the Company’s contingent consideration recorded at fair value using Level 3 measurements is as follows (in thousands): Contingent Consideration Balance at December 31, 2021 $ 57,598 Fair value adjustments and accretion (1,071) Balance at March 31, 2022 $ 56,527 Available-for-Sale Investments Short-term investments consist of asset-backed securities collateralized by credit card receivables, investment grade commercial paper and corporate and government bonds with maturities greater than three months, but less than one year. Net unrealized gains and losses (excluding credit losses, if any) from the Company’s short-term investments are reported in other comprehensive income (loss). At March 31, 2022 and December 31, 2021, all of the Company’s short-term investments are classified as available-for-sale investments and are determined to be Level 2 instruments, which are measured at fair value using standard industry models with observable inputs. The fair value of the commercial paper is measured based on a standard industry model that uses the three-month U.S. Treasury bill rate as an observable input. The fair value of the asset-backed securities and corporate bonds is principally measured or corroborated by trade data for identical issues in which related trading activity is not sufficiently frequent to be considered a Level 1 input or that of comparable securities. At the time of purchase, all short-term investments had an “A” or better rating by Standard & Poor’s. The following summarizes the Company’s short-term available-for-sale investments at March 31, 2022 and December 31, 2021 (in thousands): March 31, 2022 Investments Cost Gross Gross Fair Value Asset-backed securities $ 32,213 $ — $ (216) $ 31,997 Commercial paper 164,140 — (630) 163,510 Corporate bonds 12,503 — (115) 12,388 U.S. Government bonds 17,557 — (9) 17,548 Total $ 226,413 $ — $ (970) $ 225,443 December 31, 2021 Investments Cost Gross Gross Fair Value Asset-backed securities $ 3,182 $ — $ — $ 3,182 Commercial paper 57,533 80 (2) 57,611 Corporate bonds 9,936 102 — 10,038 Total $ 70,651 $ 182 $ (2) $ 70,831 At March 31, 2022, there were no investments available for sale that were materially less than their amortized cost. The Company elects to recognize its interest receivable separate from its available-for-sale investments. At March 31, 2022 and December 31, 2021, the interest receivable recognized in prepaid expenses and other current assets was $0.4 million and $0.1 million, respectively. Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, short-term available-for-sale investments and accounts receivable. The Company maintains its cash and cash equivalents with high-credit quality financial institutions. Such amounts may exceed federally-insured limits. As of March 31, 2022, three wholesalers each accounted for over 10% of the Company’s accounts receivable, at 34%, 19% and 19%. At December 31, 2021, four wholesalers each accounted for over 10% of the Company’s accounts receivable, at 30%, 20%, 17% and 11%. For additional information regarding the Company’s wholesalers, see Note 2 , Summary of Significant Accounting Policies . EXPAREL and ZILRETTA revenues are primarily derived from major wholesalers and specialty distributors that generally have significant cash resources. The Company performs ongoing credit evaluations of its customers as warranted and generally does not require collateral. Allowances for credit losses on the Company’s accounts receivable are maintained based on historical payment patterns, current and estimated future economic conditions, aging of accounts receivable and its write-off history. As of March 31, 2022 and December 31, 2021, the Company did not deem any allowances for credit losses on its accounts receivable necessary. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 3 Months Ended |
Mar. 31, 2022 | |
Stockholders' Equity Note [Abstract] | |
STOCKHOLDERS' EQUITY | STOCKHOLDERS’ EQUITY Accumulated Other Comprehensive Income The following tables illustrate the changes in the balances of the Company’s accumulated other comprehensive income (loss) for the periods presented (in thousands): Net Unrealized Gains Unrealized Foreign Currency Translation Accumulated Other Comprehensive Income (Loss) Balance at December 31, 2021 $ 139 $ 28 $ 167 Net unrealized loss on investments, net of tax (733) — (733) Foreign currency translation adjustments — 39 39 Balance at March 31, 2022 $ (594) $ 67 $ (527) Net Unrealized Gains Unrealized Foreign Currency Translation Accumulated Other Comprehensive Income (Loss) Balance at December 31, 2020 $ 319 $ (1) $ 318 Net unrealized loss on investments, net of tax (150) — (150) Foreign currency translation adjustments — 4 4 Balance at March 31, 2021 $ 169 $ 3 $ 172 |
STOCK PLANS
STOCK PLANS | 3 Months Ended |
Mar. 31, 2022 | |
Stockholders' Equity Note [Abstract] | |
STOCK PLANS | STOCK PLANS Stock-Based Compensation The Company recognized stock-based compensation expense in the periods presented as follows (in thousands): Three Months Ended 2022 2021 Cost of goods sold $ 1,352 $ 1,452 Research and development 1,458 1,106 Selling, general and administrative 8,379 7,552 Total $ 11,189 $ 10,110 Stock-based compensation from: Stock options $ 6,785 $ 6,496 Restricted stock units 4,113 3,392 Employee stock purchase plan 291 222 Total $ 11,189 $ 10,110 Equity Awards The following tables contain information about the Company’s stock option and restricted stock unit, or RSU, activity for the three months ended March 31, 2022: Stock Options Number of Options Weighted Average Exercise Price (Per Share) Outstanding at December 31, 2021 6,050,540 $ 49.32 Granted 120,200 62.24 Exercised (323,201) 34.28 Forfeited (33,535) 52.56 Expired (13,054) 85.48 Outstanding at March 31, 2022 5,800,950 50.33 Restricted Stock Units Number of Units Weighted Average Grant Date Fair Value (Per Share) Unvested at December 31, 2021 955,277 $ 52.85 Granted 64,700 62.34 Vested (6,950) 62.35 Forfeited (31,074) 53.76 Unvested at March 31, 2022 981,953 53.38 The weighted average fair value of stock options granted during the three months ended March 31, 2022 wa s $27.71 per share. The fair values of stock options granted were estimated using the Black-Scholes option valuation model with the following weighted average assumptions: Black-Scholes Weighted Average Assumption Three Months Ended March 31, 2022 Expected dividend yield None Risk-free interest rate 1.44% Expected volatility 48.55% Expected term of options 5.30 years Employee Stock Purchase Plan The Company’s 2014 Employee Stock Purchase Plan, or ESPP, features two six-month offering periods per year, running from January 1 to June 30 and July 1 to December 31. Under the ESPP, employees may elect to contribute after-tax earnings to purchase shares at 85% of the closing fair market value of the Company’s common stock on either the offering date or the purchase date, whichever is less. During the three months ended March 31, 2022, no shares were purchased and issued through the ESPP. |
NET INCOME (LOSS) PER SHARE
NET INCOME (LOSS) PER SHARE | 3 Months Ended |
Mar. 31, 2022 | |
Earnings Per Share [Abstract] | |
NET INCOME (LOSS) PER SHARE | NET INCOME (LOSS) PER SHARE Basic net income (loss) per share is calculated by dividing the net income (loss) attributable to common shares by the weighted average number of common shares outstanding during the period. Diluted net income (loss) per common share is calculated by dividing the net income (loss) attributable to common shares by the weighted average number of common shares outstanding plus dilutive potential common shares outstanding during the period. ASU 2020-06 was adopted on January 1, 2022 and requires the Company to use the if-converted method to calculate the number of potentially dilutive shares for convertible debt. Under the if-converted method, adjustments are made to the diluted net income (loss) per common share calculation as if the Company had converted the convertible debt on the first day of each period presented. Adjustments to the numerator are made to add back the interest expense associated with the convertible debt on a post-tax basis. Adjustments to the denominator reflect the number of shares assumed to be convertible at the beginning of the period. For additional information regarding ASU 2020-06, see Note 2 , Summary of Significant Accounting Policies . Prior to January 1, 2022, the Company used the treasury stock method to calculate dilutive shares on its convertible debt. Potential common shares include the shares of common stock issuable upon the exercise of outstanding stock options, the vesting of RSUs and the purchase of shares from the ESPP (using the treasury stock method), if applicable. Potential common shares are excluded from the diluted net income (loss) per share computation to the extent they would be antidilutive. The following table sets forth the computation of basic and diluted net income per common share for the three mon ths ended March 31, 2022 and 2021 (in thousands, except per share amounts): Three Months Ended 2022 2021 Numerator: Net income $ 6,828 $ 10,369 Denominator: Weighted average common shares outstanding—basic 44,869 43,833 Computation of diluted securities: Dilutive effect of stock options 1,195 1,507 Dilutive effect of RSUs 373 470 Dilutive effect of conversion premium on the 2022 Notes — 152 Dilutive effect of ESPP purchase options 1 4 Weighted average common shares outstanding—diluted 46,438 45,966 Net income per share: Basic net income per common share $ 0.15 $ 0.24 Diluted net income per common share $ 0.15 $ 0.23 The following table summarizes the outstanding stock options, RSUs and convertible senior notes that were excluded from the diluted net income per common share calculation because the effects of including these potential shares were antidilutive in the periods presented (in thousands): Three Months Ended 2022 2021 Weighted average number of stock options 1,762 890 Convertible senior notes 8,000 — Weighted average number of RSUs 17 2 Total 9,779 892 |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES Income before income taxes is as follows (in thousands): Three Months Ended 2022 2021 Income (loss) before income taxes: Domestic $ 6,582 $ 15,933 Foreign 712 (3,209) Total income before income taxes $ 7,294 $ 12,724 |
ACQUISITION_RELATED CHARGES, PR
ACQUISITION–RELATED CHARGES, PRODUCT DISCONTINUATION AND OTHER | 3 Months Ended |
Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ACQUISITION–RELATED CHARGES, PRODUCT DISCONTINUATION AND OTHER | ACQUISITION–RELATED CHARGES, PRODUCT DISCONTINUATION AND OTHER Acquisition-related charges, product discontinuation and other for the three months ended March 31, 2022 and 2021 summarized below (in thousands): Three Months Ended 2022 2021 Severance-related expenses $ 3,115 $ — Acquisition-related fees 1,845 — Other acquisition expenses 448 — Total acquisition-related charges 5,408 — Flexion contingent consideration (794) — MyoScience contingent consideration (277) (1,127) Nuance Biotech Co. Ltd. agreement dissolution costs — 3,000 Total acquisition-related charges, product discontinuation and other $ 4,337 $ 1,873 Flexion Acquisition The Company recognized acquisition-related costs of $5.4 million, primarily severance, legal fees, third-party services and other one-time charges during the three months ended March 31, 2022 related to the Flexion Acquisition. See Note 4 , Flexion Acquisition , for more information. On November 19, 2021, as part of the purchase price consideration related to the Flexion Acquisition, the Company recorded contingent consideration of $45.2 million, which represents the Company’s potential achievement of meeting regulatory and sales-based milestones. During the three months ended March 31, 2022 , the Company recorded a $0.8 million credit due to a decrease to the fair value of its contingent consideration, which was included in acquisition-related charges in the condensed consolidated statements of operations. See Note 10 , Financial Instruments , for information regarding the method and key assumptions used in the fair value measurements of contingent consideration. MyoScience Acquisition The Company recognized contingent consideration credits of $0.3 million and $1.1 million during the three months ended March 31, 2022 and 2021, respectively. See Note 10 , Financial Instruments , for information regarding the method and key assumptions used in the fair value measurements of contingent consideration. Nuance Biotech Co. Ltd. In June 2018, the Company entered an agreement with Nuance Biotech Co. Ltd., or Nuance, a China-based specialty pharmaceutical company, to advance the development and commercialization of EXPAREL in China. Under the terms of the agreement, the Company had granted Nuance the exclusive rights to develop and commercialize EXPAREL. In April 2021, the Company and Nuance agreed to a mutual termination of the agreement due to the lack of a viable regulatory pathway that adequately safeguards the Company’s intellectual property against the risk of a generic product. Dissolution costs of $3.0 million were included in other operating expenses in the condensed consolidated statements of operations for the three months ended March 31, 2021. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES From time to time, the Company has been and may again become involved in legal proceedings arising in the ordinary course of its business, including those related to patents, product liability and government investigations. Except as described below, the Company is not presently a party to any legal proceedings that it believes to be material, and is not aware of any pending or threatened litigation against the Company which it believes could have a material adverse effect on its business, operating results, financial condition or cash flows. MyoScience Milestone Litigation In August 2020, the Company and its subsidiary, Pacira CryoTech, Inc. (“Pacira CryoTech”), filed a lawsuit in the Court of Chancery of the State of Delaware against Fortis Advisors LLC (“Fortis”), solely in its capacity as representative for the former securityholders of MyoScience, and certain other defendants, seeking declaratory judgment with respect to certain terms of the merger agreement for the MyoScience Acquisition (the “Merger Agreement”), specifically related to the achievement of certain milestone payments under the Merger Agreement. In addition, the Company and Pacira CryoTech sought general, special and compensatory damages against the other defendants related to breach of fiduciary duties in connection with the purported achievement of milestone payments under the Merger Agreement, and breach of the Merger Agreement and certain other agreements with the defendants. In October 2020, Fortis filed an answer and counterclaim against the Company and Pacira CryoTech seeking to recover certain milestone payments under the Merger Agreement. The total remaining value of these milestones is $30.0 million, plus attorneys’ fees. The Company believes that the counterclaim from Fortis is without merit and intends to vigorously defend against all claims. The Company is unable to predict the outcome of this action at this time. eVenus Pharmaceutical Laboratories Litigations In October 2021, the Company received a Notice Letter advising that eVenus Pharmaceutical Laboratories, Inc., or eVenus, of Princeton, New Jersey, submitted to the FDA an Abbreviated New Drug Application (ANDA) with a Paragraph IV certification seeking authorization for the manufacturing and marketing of a generic version of EXPAREL (266 mg/20 mL) in the U.S. prior to the expiration of U.S. Patent No. 11,033,495 (the ’495 patent). In November 2021, the Company filed a patent infringement suit against eVenus and its parent company in the U.S. District Court for the District of New Jersey (21-cv-19829) asserting infringement of the ’495 patent. This triggered an automatic 30-month stay of final approval of the eVenus ANDA. On January 6, 2022, eVenus filed an Answer with counterclaims to the Complaint, alleging the ’495 patent is invalid and/or not infringed through the manufacture, sale, or offer for sale of the product described in product described in eVenus’s ANDA submission. In December 2021, the Company received a second Notice Letter advising that eVenus submitted to the FDA an amendment to its ANDA with a Paragraph IV Certification seeking authorization for the manufacturing and marketing of a generic version of EXPAREL (133 mg/10 mL) in the U.S. prior to the expiration of the ’495 patent. In the Notice Letter, eVenus also advised that it submitted a Paragraph IV Certification to the FDA seeking authorization for the manufacturing and marketing of a generic version of EXPAREL (266 mg/20 mL and 133 mg/10 mL) in the U.S. prior to the expiration of U.S. Patent No. 11,179,336 (the ’336 patent). eVenus further alleges in the Notice Letter that both the ’495 patent and the ’366 patent are invalid and/or not infringed. In February 2022, the Company filed a second patent infringement suit against eVenus and its parent company in the U.S. District Court for the District of New Jersey (22-cv-00718) asserting that the 133 mg/10 mL ANDA product will infringe the ’495 and ’336 patents and that the 266 mg/20 mL ANDA product will infringe the ’336 patent. This filing triggered a second automatic 30-month stay of final approval for the 133 mg/10 mL ANDA product. These litigations are in their infancy, and the Company is unable to predict the outcome of this action at this time. Research Development Foundation Pursuant to an agreement with the Research Development Foundation, or RDF, the Company was required to pay RDF a low single-digit royalty on the collection of revenues from certain products, for as long as certain patents assigned to the Company under the agreement remain valid. RDF has the right to terminate the agreement for an uncured material breach by the Company, in connection with its bankruptcy or insolvency or if it directly or indirectly opposes or disputes the validity of the assigned patent rights. The Company’s U.S. Patent No. 11,033,495 was issued on June 15, 2021. Thereafter, RDF asserted that the issuance of that patent extends the Company’s royalty obligations under the agreement until 2041. The Company believes that the royalty period under the agreement was set to end on December 24, 2021 with the expiration of its U.S. Patent No. 9,585,838. Because of the disagreement over the interpretation of the agreement, in December 2021, the Company filed a declaratory judgment lawsuit in the U.S. District Court for the District of Nevada (21-cv-02241). The lawsuit seeks a declaration from the court that the Company owes no royalties to RDF with respect to its EXPAREL product after December 24, 2021. During the pendency of the lawsuit, the Company will continue to pay royalties to RDF under protest, however, the Company is unable to predict the outcome of this action at this time. Other Commitments and Contingencies Pediatric Trial Commitments The FDA, as a condition of EXPAREL approval, has required the Company to study EXPAREL in pediatric patients, as well as the administration of EXPAREL as a nerve block in the pediatric setting. The Company was granted a deferral for the required pediatric trials until after the indications were approved in adults. Similarly, in Europe, the Company agreed with the European Medicines Agency, or EMA, on a Pediatric Investigation Plan as a prerequisite for submitting a Marketing Authorization Application (MAA) in the E.U. Despite the U.K.’s withdrawal from the E.U., the agreed pediatric plan is applicable in the U.K. In December 2019, the Company announced positive results for its extended pharmacokinetic and safety study (“PLAY”) for local analgesia in children aged six to 17 undergoing cardiovascular or spine surgeries. Those positive results were the basis for the submission of a supplemental New Drug Application, or sNDA, in the U.S. and Type II variations in the E.U. and U.K. to expand the EXPAREL label to include use in patients six years of age and older for single-dose infiltration to produce postsurgical local analgesia. In March 2021, the Company announced that the FDA approved the submission of the sNDA in the U.S. The EMA and the Medicines and Healthcare Products Regulatory Agency, or MHRA, are still reviewing the Type II variations. The Company is working with the FDA, MAA and MHRA to finalize the regulatory pathway for its remaining pediatric commitments. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation These interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America, or GAAP, and in accordance with the rules and regulations of the United States Securities and Exchange Commission (SEC), for interim reporting. Pursuant to these rules and regulations, certain information and footnote disclosures normally included in complete annual financial statements have been condensed or omitted. Therefore, these interim condensed consolidated financial statements should be read in conjunction with the audited annual consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 . The condensed consolidated financial statements at March 31, 2022, and for the three-month periods ended March 31, 2022 and 2021, are unaudited, but include all adjustments (consisting of only normal recurring adjustments) which, in the opinion of management, are necessary to present fairly the financial information set forth herein in accordance with GAAP. The condensed consolidated balance sheet at December 31, 2021 is derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. The condensed consolidated financial statements as presented reflect certain reclassifications from previously issued financial statements to conform to the current year presentation. The accounts of wholly-owned subsidiaries are included in the condensed consolidated financial statements. Intercompany accounts and transactions have been eliminated in consolidation. The results of operations for these interim periods are not necessarily indicative of results that may be expected for any other interim periods or for the full year. |
Concentration of Major Customers | Concentration of Major Customers The Company sells EXPAREL through a drop-ship program under which orders are processed through wholesalers (including AmerisourceBergen Health Corporation, Cardinal Health, Inc. and McKesson Drug Company), but shipments of the product are sent directly to individual accounts, such as hospitals, ambulatory surgery centers and individual doctors. The Company also sells EXPAREL directly to ambulatory surgery centers and physicians. The Company sells ZILRETTA primarily to specialty distributors and a specialty pharmacy, who then subsequently resell ZILRETTA to physicians, clinics and certain medical centers or hospitals. The Company also contracts directly with healthcare providers and intermediaries such as Group Purchasing Organizations, or GPOs. The Company sells iovera° directly to end users and its bupivacaine liposome injectable suspension for veterinary use to a third-party licensee in the U.S. |
Recent Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In August 2020, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40), |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
Schedule of percentage of revenue comprised by the three largest customers | The table below includes the percentage of revenues comprised by the Company’s three largest wholesalers in each period presented: Three Months Ended 2022 2021 Largest wholesaler 31% 32% Second largest wholesaler 23% 29% Third largest wholesaler 22% 27% Total 76% 88% |
REVENUE (Tables)
REVENUE (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregated revenue | The following table represents disaggregated net product sales in the periods presented as follows (in thousands): Three Months Ended 2022 2021 Net product sales: EXPAREL $ 129,205 $ 114,678 ZILRETTA 23,635 — iovera° 3,026 3,268 Bupivacaine liposome injectable suspension 1,556 792 Total net product sales $ 157,422 $ 118,738 |
FLEXION ACQUISITION (Tables)
FLEXION ACQUISITION (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table sets forth the preliminary allocation of the Flexion Acquisition purchase price to the estimated fair value of the net assets acquired at the acquisition date (in thousands): Amounts Recognized at the Acquisition Date (as previously reported) (a) Measurement Period Adjustments (b) Amounts Recognized at the Acquisition Date ASSETS ACQUIRED Cash and cash equivalents $ 113,562 $ — $ 113,562 Short-term available-for-sale investments 11,153 — 11,153 Accounts receivable 32,838 — 32,838 Inventories 29,667 — 29,667 Prepaid expenses and other assets 4,852 — 4,852 Fixed assets 23,307 — 23,307 Deferred tax assets 58,015 — 58,015 Right-of-use assets 6,585 — 6,585 Identifiable intangible assets 480,000 — 480,000 In-process research and development (IPR&D) 61,000 — 61,000 Total assets $ 820,979 $ — $ 820,979 LIABILITIES ASSUMED Accounts payable $ 9,794 $ — $ 9,794 Accrued expenses 22,746 547 23,293 Deferred revenue 10,000 — 10,000 Lease liabilities 6,585 — 6,585 Other liabilities 1,187 — 1,187 Long-term debt 201,450 — 201,450 Total liabilities 251,762 547 252,309 Total identifiable net assets acquired 569,217 (547) 568,670 Goodwill 9,628 547 10,175 Total consideration transferred $ 578,845 $ — $ 578,845 (a) As previously reported in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. (b) Represents pre-acquisition expenses that were paid by the Company in 2022. |
Unaudited Pro Forma Summary of Operations | This pro forma information does not purport to represent what the Company’s actual results would have been if the Flexion Acquisition had occurred as of January 1, 2020, and is not indicative of what such results would be expected for any future period (in thousands, except per share amounts): Three Months Ended Total revenues $ 143,616 Net loss $ (17,120) Pro forma basic and diluted net loss per share $ (0.39) |
INVENTORIES (Tables)
INVENTORIES (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Inventory Disclosure [Abstract] | |
Schedule of components of inventories | The components of inventories, net are as follows (in thousands): March 31, December 31, 2022 2021 Raw materials $ 35,297 $ 36,337 Work-in-process 33,995 35,182 Finished goods 34,370 27,031 Total $ 103,662 $ 98,550 |
FIXED ASSETS (Tables)
FIXED ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schedule of fixed assets summarized by major category | Fixed assets, net, summarized by major category, consist of the following (in thousands): March 31, December 31, 2022 2021 Machinery and equipment $ 117,167 $ 117,264 Leasehold improvements 59,743 59,740 Computer equipment and software 13,207 13,197 Office furniture and equipment 2,914 2,883 Construction in progress 87,457 80,557 Total 280,488 273,641 Less: accumulated depreciation (90,721) (85,240) Fixed assets, net $ 189,767 $ 188,401 |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Leases [Abstract] | |
Summary of operating lease cost and other operating lease information | Total operating lease costs are as follows (in thousands): Three Months Ended March 31, 2022 2021 Fixed lease costs $ 3,527 $ 2,922 Variable lease costs 472 478 Total $ 3,999 $ 3,400 Supplemental cash flow information related to operating leases is as follows (in thousands): Three Months Ended March 31, 2022 2021 Cash paid for operating lease liabilities, net of lease incentive $ 3,279 $ 4,600 ROU assets recorded in exchange for lease obligations $ 16 $ — March 31, 2022 2021 Weighted average remaining lease term 7.55 years 8.95 years Weighted average discount rate 6.95 % 6.89 % |
Schedule of maturities of operating lease liabilities | Maturities of the Company’s operating lease liabilities are as follows (in thousands): Year Aggregate Minimum Payments Due 2022 (remaining nine months) $ 9,867 2023 13,304 2024 13,435 2025 12,575 2026 12,310 Thereafter 39,423 Total future lease payments 100,914 Less: imputed interest (23,186) Total operating lease liabilities $ 77,728 |
Schedule of operating lease not yet commenced, payments due | As of March 31, 2022, the Company has entered into one lease agreement not included above as the Company has not yet taken possession of the property. When the lease commences, the future lease obligations will be as follows (in thousands): Year Aggregate Minimum Payments Due 2022 (remaining nine months) $ 239 2023 410 2024 416 2025 419 2026 425 Thereafter 179 Total future lease payments $ 2,088 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of finite-lived intangible assets acquired as part of business combination | March 31, 2022 Gross Carrying Value Accumulated Intangible Weighted-Average Useful Lives Developed technologies $ 590,000 $ (41,417) $ 548,583 10 years, 5 months Customer relationships 90 (27) 63 10 years Total finite-lived intangible assets, net 590,090 (41,444) 548,646 Acquired IPR&D 61,000 — 61,000 Total intangible assets, net $ 651,090 $ (41,444) $ 609,646 December 31, 2021 Gross Carrying Value Accumulated Intangible Weighted-Average Useful Lives Developed technologies $ 590,000 $ (27,097) $ 562,903 10 years, 5 months Customer relationships 90 (25) 65 10 years Total finite-lived intangible assets, net 590,090 (27,122) 562,968 Acquired IPR&D 61,000 — 61,000 Total intangible assets, net $ 651,090 $ (27,122) $ 623,968 |
DEBT (Tables)
DEBT (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt instruments | The carrying value of the Company’s outstanding debt is summarized as follows (in thousands): March 31, December 31, 2022 2021 Term loan B facility maturing December 2026 $ 360,508 $ 359,497 0.750% Convertible senior notes due August 2025 394,275 330,627 3.375% Convertible senior notes due May 2024 8,640 201,249 2.375% Convertible senior notes due April 2022 (1) 160,000 157,857 Total $ 923,423 $ 1,049,230 (1) The 2022 Notes (as defined below) matured on April 1, 2022. |
Schedule of composition of the Company's debt and financing obligations | The total debt composition of the Term Loan is as follows (in thousands): March 31, December 31, 2022 2021 Term Loan maturing December 2026 $ 375,000 $ 375,000 Deferred financing costs (4,138) (4,443) Discount on debt (10,354) (11,060) Total debt, net of debt discount and deferred financing costs $ 360,508 $ 359,497 The total debt composition of the 2025 Notes is as follows (in thousands): March 31, December 31, 2022 2021 0.750% convertible senior notes due August 2025 $ 402,500 $ 402,500 Deferred financing costs (8,225) (7,155) Discount on debt — (64,718) Total debt, net of debt discount and deferred financing costs $ 394,275 $ 330,627 The total debt composition of the 2022 Notes is as follows (in thousands): March 31, December 31, 2022 2021 2.375% convertible senior notes due April 2022 $ 160,000 $ 160,000 Deferred financing costs — (223) Discount on debt — (1,920) Total debt, net of debt discount and deferred financing costs $ 160,000 $ 157,857 |
Schedule of total interest expense recognized related to the Notes | The following table sets forth the total interest expense recognized in the periods presented (dollar amounts in thousands): Three Months Ended 2022 2021 Contractual interest expense $ 9,130 $ 1,705 Amortization of debt issuance costs 1,179 651 Amortization of debt discount 706 5,657 Capitalized interest and other (Note 6) (824) (1,042) Total $ 10,191 $ 6,971 Effective interest rate on total debt 5.58 % 6.70 % |
FINANCIAL INSTRUMENTS (Tables)
FINANCIAL INSTRUMENTS (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of carrying amount and fair value of the long-term debt | At March 31, 2022, the carrying values and fair values of the following financial assets and liabilities were as follows (in thousands): Carrying Value Fair Value Measurements Using Level 1 Level 2 Level 3 Financial Assets and Financial Liabilities Measured at Fair Value on a Recurring Basis: Financial Assets: Equity investments $ 25,627 $ — $ — $ 25,627 Convertible notes receivable $ 5,364 $ — $ — $ 5,364 Financial Liabilities: Acquisition-related contingent consideration $ 56,527 $ — $ — $ 56,527 Financial Liabilities Measured at Amortized Cost: Term loan facility due December 2026 $ 360,508 $ — $ 371,250 $ — 0.750% convertible senior notes due 2025 (1) $ 394,275 $ — $ 499,603 $ — 3.375% convertible senior notes due 2024 (2) $ 8,640 $ — $ 8,662 $ — 2.375% convertible senior notes due 2022 (3) $ 160,000 $ — $ 163,600 $ — (1) The fair value of the 2025 Notes was based on the Company’s closing stock price of $76.32 per share at March 31, 2022 compared to a conversion price of $71.78 per share which, if converted, would result in an approximate conversion premium of 0.3 million shares or $25.5 million of cash. The maximum conversion premium that can be due on the 2025 Notes is 5.6 million shares, which assumes no increases in the conversion rate for certain corporate events. (2) Relates to the Flexion 2024 Notes. For more information, See Note 9, Debt . (3) The 2022 Notes matured on April 1, 2022. For more information, See Note 9, Debt . |
Schedule of investments without readily determinable fair value | The following investments have no readily determinable fair value and are recorded at cost minus impairment, if any, plus or minus observable price changes of identical or similar investments (in thousands): Equity Investments Convertible Notes Receivable Total Balance at December 31, 2021 $ 14,127 $ 4,132 $ 18,259 Purchases 11,500 1,250 12,750 Foreign currency adjustments — (18) (18) Balance at March 31, 2022 $ 25,627 $ 5,364 $ 30,991 |
Schedule of key assumptions used in the valuation of contingent consideration | The following table includes the key assumptions used in the valuation of the Company’s contingent consideration: Assumption Flexion Ranges Utilized as of March 31, 2022 MyoScience Ranges Utilized as of March 31, 2022 Discount rates 11.50% to 13.65% 10.23% to 12.28% Probabilities of payment for regulatory milestones 5% to 15% 1% Projected years of payment for regulatory and commercial milestones 2027 to 2030 2023 |
Schedule of change in contingent consideration recorded at fair value using Level 3 measurements | The change in the Company’s contingent consideration recorded at fair value using Level 3 measurements is as follows (in thousands): Contingent Consideration Balance at December 31, 2021 $ 57,598 Fair value adjustments and accretion (1,071) Balance at March 31, 2022 $ 56,527 |
Schedule of short-term investments | The following summarizes the Company’s short-term available-for-sale investments at March 31, 2022 and December 31, 2021 (in thousands): March 31, 2022 Investments Cost Gross Gross Fair Value Asset-backed securities $ 32,213 $ — $ (216) $ 31,997 Commercial paper 164,140 — (630) 163,510 Corporate bonds 12,503 — (115) 12,388 U.S. Government bonds 17,557 — (9) 17,548 Total $ 226,413 $ — $ (970) $ 225,443 December 31, 2021 Investments Cost Gross Gross Fair Value Asset-backed securities $ 3,182 $ — $ — $ 3,182 Commercial paper 57,533 80 (2) 57,611 Corporate bonds 9,936 102 — 10,038 Total $ 70,651 $ 182 $ (2) $ 70,831 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Stockholders' Equity Note [Abstract] | |
Schedule of accumulated other comprehensive income (loss) | The following tables illustrate the changes in the balances of the Company’s accumulated other comprehensive income (loss) for the periods presented (in thousands): Net Unrealized Gains Unrealized Foreign Currency Translation Accumulated Other Comprehensive Income (Loss) Balance at December 31, 2021 $ 139 $ 28 $ 167 Net unrealized loss on investments, net of tax (733) — (733) Foreign currency translation adjustments — 39 39 Balance at March 31, 2022 $ (594) $ 67 $ (527) Net Unrealized Gains Unrealized Foreign Currency Translation Accumulated Other Comprehensive Income (Loss) Balance at December 31, 2020 $ 319 $ (1) $ 318 Net unrealized loss on investments, net of tax (150) — (150) Foreign currency translation adjustments — 4 4 Balance at March 31, 2021 $ 169 $ 3 $ 172 |
STOCK PLANS (Tables)
STOCK PLANS (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Stockholders' Equity Note [Abstract] | |
Schedule of recognized stock-based compensation in consolidated statements of operations | The Company recognized stock-based compensation expense in the periods presented as follows (in thousands): Three Months Ended 2022 2021 Cost of goods sold $ 1,352 $ 1,452 Research and development 1,458 1,106 Selling, general and administrative 8,379 7,552 Total $ 11,189 $ 10,110 Stock-based compensation from: Stock options $ 6,785 $ 6,496 Restricted stock units 4,113 3,392 Employee stock purchase plan 291 222 Total $ 11,189 $ 10,110 |
Schedule of the company's stock option activity and restricted stock unit activity | The following tables contain information about the Company’s stock option and restricted stock unit, or RSU, activity for the three months ended March 31, 2022: Stock Options Number of Options Weighted Average Exercise Price (Per Share) Outstanding at December 31, 2021 6,050,540 $ 49.32 Granted 120,200 62.24 Exercised (323,201) 34.28 Forfeited (33,535) 52.56 Expired (13,054) 85.48 Outstanding at March 31, 2022 5,800,950 50.33 Restricted Stock Units Number of Units Weighted Average Grant Date Fair Value (Per Share) Unvested at December 31, 2021 955,277 $ 52.85 Granted 64,700 62.34 Vested (6,950) 62.35 Forfeited (31,074) 53.76 Unvested at March 31, 2022 981,953 53.38 |
Schedule of share-based payment award, stock options, valuation assumptions | The fair values of stock options granted were estimated using the Black-Scholes option valuation model with the following weighted average assumptions: Black-Scholes Weighted Average Assumption Three Months Ended March 31, 2022 Expected dividend yield None Risk-free interest rate 1.44% Expected volatility 48.55% Expected term of options 5.30 years |
NET INCOME (LOSS) PER SHARE (Ta
NET INCOME (LOSS) PER SHARE (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of computation of basic and diluted loss per share | The following table sets forth the computation of basic and diluted net income per common share for the three mon ths ended March 31, 2022 and 2021 (in thousands, except per share amounts): Three Months Ended 2022 2021 Numerator: Net income $ 6,828 $ 10,369 Denominator: Weighted average common shares outstanding—basic 44,869 43,833 Computation of diluted securities: Dilutive effect of stock options 1,195 1,507 Dilutive effect of RSUs 373 470 Dilutive effect of conversion premium on the 2022 Notes — 152 Dilutive effect of ESPP purchase options 1 4 Weighted average common shares outstanding—diluted 46,438 45,966 Net income per share: Basic net income per common share $ 0.15 $ 0.24 Diluted net income per common share $ 0.15 $ 0.23 |
Schedule of potential dilutive effect of the securities excluded from the calculation of diluted loss per share | The following table summarizes the outstanding stock options, RSUs and convertible senior notes that were excluded from the diluted net income per common share calculation because the effects of including these potential shares were antidilutive in the periods presented (in thousands): Three Months Ended 2022 2021 Weighted average number of stock options 1,762 890 Convertible senior notes 8,000 — Weighted average number of RSUs 17 2 Total 9,779 892 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of income before income tax, domestic and foreign | Income before income taxes is as follows (in thousands): Three Months Ended 2022 2021 Income (loss) before income taxes: Domestic $ 6,582 $ 15,933 Foreign 712 (3,209) Total income before income taxes $ 7,294 $ 12,724 |
ACQUISITION_RELATED CHARGES, _2
ACQUISITION–RELATED CHARGES, PRODUCT DISCONTINUATION AND OTHER (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Acquisition-related Restructuring and Discontinuation Costs | Acquisition-related charges, product discontinuation and other for the three months ended March 31, 2022 and 2021 summarized below (in thousands): Three Months Ended 2022 2021 Severance-related expenses $ 3,115 $ — Acquisition-related fees 1,845 — Other acquisition expenses 448 — Total acquisition-related charges 5,408 — Flexion contingent consideration (794) — MyoScience contingent consideration (277) (1,127) Nuance Biotech Co. Ltd. agreement dissolution costs — 3,000 Total acquisition-related charges, product discontinuation and other $ 4,337 $ 1,873 |
DESCRIPTION OF BUSINESS (Detail
DESCRIPTION OF BUSINESS (Details) | 3 Months Ended |
Mar. 31, 2022segmentproduct | |
Concentration Risk [Line Items] | |
Number of reportable segments | segment | 1 |
Sales Revenue, Net | Product Concentration Risk | |
Concentration Risk [Line Items] | |
Concentration of products (in products) | product | 3 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Concentration Risk of Major Customers (Details) - Concentration risk by major customer - segment | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Concentration of Major Customers | ||
Number of customers | 3 | |
Sales Revenue, Net | Largest wholesaler | ||
Concentration of Major Customers | ||
Percentage of revenue from customers to total revenue | 31.00% | 32.00% |
Sales Revenue, Net | Second largest wholesaler | ||
Concentration of Major Customers | ||
Percentage of revenue from customers to total revenue | 23.00% | 29.00% |
Sales Revenue, Net | Third largest wholesaler | ||
Concentration of Major Customers | ||
Percentage of revenue from customers to total revenue | 22.00% | 27.00% |
Sales Revenue, Net | Three largest customers | ||
Concentration of Major Customers | ||
Percentage of revenue from customers to total revenue | 76.00% | 88.00% |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - New Accounting Pronouncements (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 | Mar. 31, 2021 | Dec. 31, 2020 |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Stockholders' equity attributable to parent | $ (709,576) | $ (730,408) | $ (650,818) | $ (619,688) |
Additional Paid-In Capital | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Stockholders' equity attributable to parent | (867,890) | (942,091) | (894,108) | (873,201) |
Accumulated Deficit | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Stockholders' equity attributable to parent | $ 157,832 | 211,895 | $ 243,506 | $ 253,875 |
Cumulative Effect, Period of Adoption, Adjusted Balance | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Long-term debt | 64,900 | |||
Increase (decrease) in deferred income taxes | 15,700 | |||
Cumulative Effect, Period of Adoption, Adjusted Balance | Additional Paid-In Capital | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Stockholders' equity attributable to parent | 96,500 | |||
Cumulative Effect, Period of Adoption, Adjusted Balance | Accumulated Deficit | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Stockholders' equity attributable to parent | $ (47,200) |
REVENUE - Narrative (Details)
REVENUE - Narrative (Details) | 3 Months Ended |
Mar. 31, 2022 | |
Minimum | |
Disaggregation of Revenue [Line Items] | |
Accounts receivable, payment terms | 0 days |
Maximum | |
Disaggregation of Revenue [Line Items] | |
Accounts receivable, payment terms | 97 days |
REVENUE - Schedule of Disaggreg
REVENUE - Schedule of Disaggregated Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Disaggregation of Revenue [Line Items] | ||
Total net product sales | $ 157,991 | $ 119,027 |
EXPAREL | ||
Disaggregation of Revenue [Line Items] | ||
Total net product sales | 129,205 | 114,678 |
ZILRETTA | ||
Disaggregation of Revenue [Line Items] | ||
Total net product sales | 23,635 | 0 |
iovera° | ||
Disaggregation of Revenue [Line Items] | ||
Total net product sales | 3,026 | 3,268 |
Bupivacaine liposome injectable suspension | ||
Disaggregation of Revenue [Line Items] | ||
Total net product sales | 1,556 | 792 |
Total net product sales | ||
Disaggregation of Revenue [Line Items] | ||
Total net product sales | $ 157,422 | $ 118,738 |
FLEXION ACQUISITION - Narrative
FLEXION ACQUISITION - Narrative (Details) - Flexion - USD ($) $ in Millions | Nov. 19, 2021 | Dec. 31, 2021 |
Business Acquisition [Line Items] | ||
Total consideration transferred | $ 578.8 | |
Retirement of term loan | 85.1 | |
Fair value of contingent value rights (CVRs) | 45.2 | |
Additional amount payable to holders of the CVRs | $ 380.2 | |
RSUs, In-The-Money Stock Options, and Common Stock | ||
Business Acquisition [Line Items] | ||
Cash paid to acquire business | $ 448.5 |
FLEXION ACQUISITION - Schedule
FLEXION ACQUISITION - Schedule of Assets and Liabilities (Details) - USD ($) $ in Thousands | 4 Months Ended | ||
Mar. 31, 2022 | Dec. 31, 2021 | Nov. 19, 2021 | |
ASSETS ACQUIRED | |||
Total assets | $ 0 | ||
LIABILITIES ASSUMED | |||
Accrued expenses | 547 | ||
Total liabilities | 547 | ||
Total identifiable net assets acquired | (547) | ||
Goodwill | 145,722 | $ 145,175 | |
Goodwill | 547 | ||
Total consideration transferred | 0 | ||
Flexion | |||
ASSETS ACQUIRED | |||
Cash and cash equivalents | 113,562 | $ 113,562 | |
Short-term available-for-sale investments | 11,153 | 11,153 | |
Accounts receivable | 32,838 | 32,838 | |
Inventories | 29,667 | 29,667 | |
Prepaid expenses and other assets | 4,852 | 4,852 | |
Fixed assets | 23,307 | 23,307 | |
Deferred tax assets | 58,015 | 58,015 | |
Right-of-use assets | 6,585 | 6,585 | |
Identifiable intangible assets | 480,000 | 480,000 | |
In-process research and development (IPR&D) | 61,000 | 61,000 | |
Total assets | 820,979 | 820,979 | |
LIABILITIES ASSUMED | |||
Accounts payable | 9,794 | 9,794 | |
Accrued expenses | 23,293 | 22,746 | |
Deferred revenue | 10,000 | 10,000 | |
Lease liabilities | 6,585 | 6,585 | |
Other liabilities | 1,187 | 1,187 | |
Long-term debt | 201,450 | 201,450 | |
Total liabilities | 252,309 | 251,762 | |
Total identifiable net assets acquired | 568,670 | 569,217 | |
Goodwill | 10,175 | 9,628 | |
Total consideration transferred | $ 578,845 | $ 578,845 |
FLEXION ACQUISITION - Schedul_2
FLEXION ACQUISITION - Schedule of Pro Forma Information (Details) - Flexion | 3 Months Ended |
Mar. 31, 2021USD ($)$ / shares | |
Business Acquisition [Line Items] | |
Total revenues | $ | $ 143,616,000 |
Net loss | $ | $ (17,120,000) |
Pro forma basic net loss per share (in usd per share) | $ / shares | $ (0.39) |
Pro forma diluted net loss per share (in usd per share) | $ / shares | $ (0.39) |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 35,297 | $ 36,337 |
Work-in-process | 33,995 | 35,182 |
Finished goods | 34,370 | 27,031 |
Total | $ 103,662 | $ 98,550 |
FIXED ASSETS - Summary of Major
FIXED ASSETS - Summary of Major Categories (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
FIXED ASSETS | ||
Property, plant, and equipment, gross | $ 280,488 | $ 273,641 |
Less: accumulated depreciation | (90,721) | (85,240) |
Fixed assets, net | 189,767 | 188,401 |
Machinery and equipment | ||
FIXED ASSETS | ||
Property, plant, and equipment, gross | 117,167 | 117,264 |
Leasehold improvements | ||
FIXED ASSETS | ||
Property, plant, and equipment, gross | 59,743 | 59,740 |
Computer equipment and software | ||
FIXED ASSETS | ||
Property, plant, and equipment, gross | 13,207 | 13,197 |
Office furniture and equipment | ||
FIXED ASSETS | ||
Property, plant, and equipment, gross | 2,914 | 2,883 |
Construction in progress | ||
FIXED ASSETS | ||
Property, plant, and equipment, gross | $ 87,457 | $ 80,557 |
FIXED ASSETS - Narrative (Detai
FIXED ASSETS - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
FIXED ASSETS | |||
Depreciation expense | $ 5,700 | $ 2,900 | |
Capitalized interest and other (Note 6) | 824 | 1,042 | |
Fixed assets, net | 189,767 | $ 188,401 | |
Asset retirement obligation | 3,000 | 2,400 | |
Construction in progress | |||
FIXED ASSETS | |||
Capitalized interest and other (Note 6) | 800 | $ 1,000 | |
Leasehold improvements | Europe | |||
FIXED ASSETS | |||
Fixed assets, net | $ 62,800 | $ 65,400 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022USD ($)segmentlease | Dec. 31, 2021USD ($) | |
Lessee, Lease, Description [Line Items] | ||
Number of embedded leases | lease | 2 | |
Number of leases not yet commenced | segment | 1 | |
ROU asset | $ 74,271 | $ 76,410 |
Woburn, Massachusetts | ||
Lessee, Lease, Description [Line Items] | ||
ROU asset | 400 | |
Future cash to be received in excess of ROU asset | $ 100 | |
Maximum | ||
Lessee, Lease, Description [Line Items] | ||
Term of contract | 8 years 4 months 24 days |
LEASES - Summary of operating l
LEASES - Summary of operating lease cost and other operating lease information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Lease, Cost [Abstract] | ||
Fixed lease costs | $ 3,527 | $ 2,922 |
Variable lease costs | 472 | 478 |
Total | 3,999 | 3,400 |
Cash Flow, Operating Activities, Lessee [Abstract] | ||
Cash paid for operating lease liabilities, net of lease incentive | 3,279 | 4,600 |
ROU assets recorded in exchange for lease obligations | $ 16 | $ 0 |
Weighted average remaining lease term | 7 years 6 months 18 days | 8 years 11 months 12 days |
Weighted average discount rate | 6.95% | 6.89% |
LEASES - Schedule of maturities
LEASES - Schedule of maturities of operating lease liabilities (Details) $ in Thousands | Mar. 31, 2022USD ($) |
Leases [Abstract] | |
2022 (remaining nine months) | $ 9,867 |
2023 | 13,304 |
2024 | 13,435 |
2025 | 12,575 |
2026 | 12,310 |
Thereafter | 39,423 |
Total future lease payments | 100,914 |
Less: imputed interest | (23,186) |
Total operating lease liabilities | $ 77,728 |
LEASES -Schedule of maturities
LEASES -Schedule of maturities of operating lease liabilities (lease not yet commenced) (Details) $ in Thousands | Mar. 31, 2022USD ($) |
Leases [Abstract] | |
2022 (remaining nine months) | $ 239 |
2023 | 410 |
2024 | 416 |
2025 | 419 |
2026 | 425 |
Thereafter | 179 |
Total future lease payments | $ 2,088 |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Goodwill | |||
Goodwill recorded in connection with the acquisition | $ 145,722 | $ 145,175 | |
Amortization of acquired intangible assets | 14,322 | $ 1,967 | |
Amortization expense, remainder of fiscal year | 43,000 | ||
Amortization expense, first period | 57,300 | ||
Amortization expense, second period | 57,300 | ||
Amortization expense, third period | 37,400 | ||
Amortization expense, fourth period | 7,900 | ||
Amortization expense, fifth period | 2,200 | ||
When annual net sales collected reach $500.0 million | Skye Pharma Holding Inc. | |||
Goodwill | |||
Milestone payments for EXPAREL agreed in connection with acquisition | 32,000 | ||
Annual net sales threshold | $ 500,000 |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS - Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2022 | Dec. 31, 2021 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | $ 590,090 | $ 590,090 |
Accumulated Amortization | (41,444) | (27,122) |
Intangible Assets, Net | 548,646 | 562,968 |
Gross Carrying Value | 651,090 | 651,090 |
Intangible Assets, Net | 609,646 | 623,968 |
Developed technologies | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 590,000 | 590,000 |
Accumulated Amortization | (41,417) | (27,097) |
Intangible Assets, Net | $ 548,583 | $ 562,903 |
Weighted-Average Useful Lives | 10 years 5 months | 10 years 5 months |
Customer relationships | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | $ 90 | $ 90 |
Accumulated Amortization | (27) | (25) |
Intangible Assets, Net | $ 63 | $ 65 |
Weighted-Average Useful Lives | 10 years | 10 years |
Acquired IPR&D | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | $ 61,000 | $ 61,000 |
Intangible Assets, Net | $ 61,000 | $ 61,000 |
DEBT - Carrying Value of Debt (
DEBT - Carrying Value of Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 | Jul. 31, 2020 | Mar. 31, 2017 |
Unsecured Debt | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | $ 923,423 | $ 1,049,230 | ||
Term Loan B Facility Due 2026 | Secured Debt | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | $ 360,508 | 359,497 | ||
Convertible Senior Notes Due 2025 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate (as a percent) | 0.75% | |||
Convertible Senior Notes Due 2025 | Unsecured Debt | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | $ 394,275 | 330,627 | ||
Stated interest rate (as a percent) | 0.75% | 0.75% | ||
Convertible Senior Notes Due May 2024 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate (as a percent) | 3.375% | |||
Convertible Senior Notes Due May 2024 | Unsecured Debt | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | $ 8,640 | 201,249 | ||
Convertible Senior Notes Due 2022 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate (as a percent) | 2.375% | |||
Convertible Senior Notes Due 2022 | Unsecured Debt | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | $ 160,000 | $ 157,857 | ||
Stated interest rate (as a percent) | 2.375% | 2.375% | 2.375% |
DEBT - Narrative (Details)
DEBT - Narrative (Details) | Dec. 31, 2025USD ($) | Jun. 30, 2022USD ($) | Apr. 01, 2022USD ($)shares | May 02, 2017USD ($)$ / shares | Jan. 06, 2022 | Dec. 31, 2021USD ($) | Jul. 31, 2020USD ($)$ / shares | Mar. 31, 2017USD ($)$ / shares | Mar. 31, 2022USD ($)paymentdsegment$ / shares | Mar. 31, 2021USD ($) | Dec. 31, 2022USD ($) | Dec. 07, 2026USD ($) | Jan. 07, 2022USD ($) | Dec. 30, 2021USD ($) | Dec. 06, 2021$ / sharesshares |
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Settlement period - convertible debt conversion request | 40 days | ||||||||||||||
Closing sale price (in dollars per share) | $ / shares | $ 76.32 | ||||||||||||||
Amortization of debt discount | $ 706,000 | $ 5,657,000 | |||||||||||||
Subsequent Event | Common Stock | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Conversion of convertible securities (in shares) | shares | 101,521 | ||||||||||||||
Convertible Senior Notes Due 2025 | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Stated interest rate (as a percent) | 0.75% | ||||||||||||||
Initial conversion price of notes into common stock (in dollars per share) | $ / shares | $ 71.78 | $ 71.78 | |||||||||||||
Convertible debt, premium on common stock | 32.50% | ||||||||||||||
Closing sale price (in dollars per share) | $ / shares | $ 54.17 | ||||||||||||||
Market price of principal amount of notes | 1.241 | ||||||||||||||
Initial conversion rate of common stock per $1,000 of principal amount of Notes | 0.0139324 | ||||||||||||||
Convertible Senior Notes Due 2025 | Debt Redemption Terms Prior to February 3, 2023 | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Threshold percentage stock price trigger | 130.00% | ||||||||||||||
Threshold trading days | d | 20 | ||||||||||||||
Threshold consecutive trading days | d | 30 | ||||||||||||||
Convertible Senior Notes Due 2025 | Debt Redemption Terms on or after August 1, 2023 | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Threshold percentage stock price trigger | 130.00% | ||||||||||||||
Threshold trading days | segment | 20 | ||||||||||||||
Threshold consecutive trading days | d | 30 | ||||||||||||||
Debt instrument, percentage of principal amount for computation of redemption price | 100.00% | ||||||||||||||
Convertible Senior Notes Due 2022 | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Stated interest rate (as a percent) | 2.375% | ||||||||||||||
Initial conversion rate of common stock per $1,000 of principal amount of Notes | 0.0149491 | ||||||||||||||
Convertible Senior Notes Due 2022 | Conversion terms prior to close of business on business day immediately proceeding October 1, 2021 | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Market price of principal amount of notes | 1.038 | ||||||||||||||
Term Loan B Facility Due 2026 | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Leverage ratio, maximum | 1.75 | ||||||||||||||
Leverage ratio, maximum, value | $ 150,000,000 | ||||||||||||||
Weighted average interest rate, at point in time | 7.75% | ||||||||||||||
Term Loan B Facility Due 2026 | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Basis spread two on variable rate | 7.00% | ||||||||||||||
Basis spread one on variable rate | 1.00% | ||||||||||||||
Term Loan B Facility Due 2026 | Base Rate | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Basis spread on variable rate | 6.00% | ||||||||||||||
Term Loan B Facility Due 2026 | Minimum | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Variable rate | 0.75% | ||||||||||||||
Term Loan B Facility Due 2026 | Minimum | Base Rate | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Variable rate | 1.75% | ||||||||||||||
Term Loan B Facility Due 2026 | Minimum | Federal Reserve Bank Of NY, Rate | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Basis spread on variable rate | 0.50% | ||||||||||||||
Convertible Senior Notes Due 2024 | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Debt instrument, percentage of principal amount for computation of redemption price | 100.00% | ||||||||||||||
Convertible Senior Notes Due 2024 | Flexion | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Initial conversion price of notes into common stock (in dollars per share) | $ / shares | $ 26.78 | $ 317.40 | |||||||||||||
Initial conversion rate of common stock per $1,000 of principal amount of Notes | 0.0373413 | ||||||||||||||
Debt conversion, converted instrument, warrants or rights issued, per principal amount | shares | 37.3413 | ||||||||||||||
Convertible Senior Notes Due May 2024 | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Stated interest rate (as a percent) | 3.375% | ||||||||||||||
Unsecured Debt | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Long-term debt | $ 1,049,230,000 | $ 923,423,000 | |||||||||||||
Unsecured Debt | Convertible Senior Notes Due 2025 | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Debt instrument, face amount | $ 402,500,000 | ||||||||||||||
Debt instrument, unamortized discount | 64,718,000 | $ 0 | |||||||||||||
Stated interest rate (as a percent) | 0.75% | 0.75% | |||||||||||||
Debt issued in private placement | $ 390,000,000 | $ 402,500,000 | |||||||||||||
Long-term debt | 330,627,000 | 394,275,000 | |||||||||||||
Unsecured Debt | Convertible Senior Notes Due 2022 | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Debt instrument, unamortized discount | 1,920,000 | $ 0 | |||||||||||||
Stated interest rate (as a percent) | 2.375% | 2.375% | 2.375% | ||||||||||||
Debt issued in private placement | $ 345,000,000 | ||||||||||||||
Debt instrument, repurchased face amount | $ 185,000,000 | ||||||||||||||
Repayments of debt | $ 211,100,000 | ||||||||||||||
Long-term debt | 157,857,000 | $ 160,000,000 | |||||||||||||
Unsecured Debt | Convertible Senior Notes Due 2022 | Subsequent Event | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Repayments of debt | $ 156,900,000 | ||||||||||||||
Extinguishment of debt, amount | 160,000,000 | ||||||||||||||
Amortization of debt discount | $ (4,800,000) | ||||||||||||||
Unsecured Debt | Convertible Senior Notes Due 2024 | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Stated interest rate (as a percent) | 3.375% | ||||||||||||||
Repurchase amount | $ 192,600,000 | ||||||||||||||
Unsecured Debt | Convertible Senior Notes Due 2024 | Flexion | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Debt instrument, face amount | $ 201,300,000 | ||||||||||||||
Stated interest rate (as a percent) | 3.375% | ||||||||||||||
Unsecured Debt | Convertible Senior Notes Due May 2024 | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Long-term debt | $ 201,249,000 | $ 8,640,000 | |||||||||||||
Secured Debt | Term Loan B Facility Due 2026 | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Discount rate | 3.00% | ||||||||||||||
Debt instrument, face amount | $ 375,000,000 | ||||||||||||||
Proceeds from lines of credit | 363,800,000 | ||||||||||||||
Debt instrument, unamortized discount | 11,060,000 | $ 10,354,000 | $ 11,200,000 | ||||||||||||
Number of payments in next fiscal year | payment | 3 | ||||||||||||||
Prepayment penalty, percent, year 1 | 2.00% | ||||||||||||||
Prepayment penalty, percent, year 2 | 2.00% | ||||||||||||||
Prepayment penalty, percent, year 3 and thereafter | 1.00% | ||||||||||||||
Long-term debt | $ 359,497,000 | $ 360,508,000 | |||||||||||||
Secured Debt | Term Loan B Facility Due 2026 | Scenario, Forecast | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Periodic payment, principal | $ 14,100,000 | $ 9,400,000 | |||||||||||||
Balloon payment to be paid | $ 188,000,000 | ||||||||||||||
Secured Debt | Term Loan B Facility Due 2026 | Scenario, Forecast | Subsequent Event | |||||||||||||||
DEBT AND FINANCING OBLIGATIONS | |||||||||||||||
Periodic payment, principal | $ 28,100,000 |
DEBT - Schedule of Debt (Detail
DEBT - Schedule of Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 | Dec. 30, 2021 | Jul. 31, 2020 | Mar. 31, 2017 |
Convertible Senior Notes Due 2025 | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate (as a percent) | 0.75% | ||||
Convertible Senior Notes Due 2022 | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate (as a percent) | 2.375% | ||||
Unsecured Debt | |||||
Debt Instrument [Line Items] | |||||
Total debt, net of debt discount and deferred financing costs | $ 923,423 | $ 1,049,230 | |||
Unsecured Debt | Convertible Senior Notes Due 2025 | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate (as a percent) | 0.75% | 0.75% | |||
Convertible senior notes | $ 402,500 | 402,500 | |||
Deferred financing costs | (8,225) | (7,155) | |||
Discount on debt | 0 | (64,718) | |||
Total debt, net of debt discount and deferred financing costs | $ 394,275 | 330,627 | |||
Unsecured Debt | Convertible Senior Notes Due 2022 | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate (as a percent) | 2.375% | 2.375% | 2.375% | ||
Convertible senior notes | $ 160,000 | 160,000 | |||
Deferred financing costs | 0 | (223) | |||
Discount on debt | 0 | (1,920) | |||
Total debt, net of debt discount and deferred financing costs | 160,000 | 157,857 | |||
Secured Debt | Term Loan B Facility Due 2026 | |||||
Debt Instrument [Line Items] | |||||
Convertible senior notes | 375,000 | 375,000 | |||
Deferred financing costs | (4,138) | (4,443) | |||
Discount on debt | (10,354) | (11,060) | $ (11,200) | ||
Total debt, net of debt discount and deferred financing costs | $ 360,508 | $ 359,497 |
DEBT - Schedule of Interest Exp
DEBT - Schedule of Interest Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Debt Disclosure [Abstract] | ||
Contractual interest expense | $ 9,130 | $ 1,705 |
Amortization of debt issuance costs | 1,179 | 651 |
Amortization of debt discount | 706 | 5,657 |
Capitalized interest and other (Note 6) | (824) | (1,042) |
Total | $ 10,191 | $ 6,971 |
Effective interest rate on total debt | 5.58% | 6.70% |
FINANCIAL INSTRUMENTS - Fair Va
FINANCIAL INSTRUMENTS - Fair Value of Liabilities Measured on a Recurring Basis (Details) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions | 3 Months Ended | ||
Mar. 31, 2022 | Jul. 31, 2020 | Mar. 31, 2017 | |
Reported Value Measurement | |||
Financial Assets: | |||
Equity investments | $ 25,627 | ||
Convertible notes receivable | 5,364 | ||
Financial Liabilities: | |||
Acquisition-related contingent consideration | 56,527 | ||
Reported Value Measurement | Term Loan B Facility Due 2026 | Secured Debt | |||
Financial Liabilities: | |||
Convertible senior notes | 360,508 | ||
Reported Value Measurement | Convertible Senior Notes Due 2025 | Unsecured Debt | |||
Financial Liabilities: | |||
Convertible senior notes | 394,275 | ||
Reported Value Measurement | Convertible Senior Notes Due 2024 | Unsecured Debt | |||
Financial Liabilities: | |||
Convertible senior notes | 8,640 | ||
Reported Value Measurement | Convertible Senior Notes Due 2022 | Unsecured Debt | |||
Financial Liabilities: | |||
Convertible senior notes | 160,000 | ||
Estimate of Fair Value Measurement | Level 1 | |||
Financial Assets: | |||
Equity investments | 0 | ||
Convertible notes receivable | 0 | ||
Financial Liabilities: | |||
Acquisition-related contingent consideration | 0 | ||
Estimate of Fair Value Measurement | Level 1 | Term Loan B Facility Due 2026 | Secured Debt | |||
Financial Liabilities: | |||
Convertible senior notes | 0 | ||
Estimate of Fair Value Measurement | Level 1 | Convertible Senior Notes Due 2025 | Unsecured Debt | |||
Financial Liabilities: | |||
Convertible senior notes | 0 | ||
Estimate of Fair Value Measurement | Level 1 | Convertible Senior Notes Due 2024 | Unsecured Debt | |||
Financial Liabilities: | |||
Convertible senior notes | 0 | ||
Estimate of Fair Value Measurement | Level 1 | Convertible Senior Notes Due 2022 | Unsecured Debt | |||
Financial Liabilities: | |||
Convertible senior notes | 0 | ||
Estimate of Fair Value Measurement | Level 2 | |||
Financial Assets: | |||
Equity investments | 0 | ||
Convertible notes receivable | 0 | ||
Financial Liabilities: | |||
Acquisition-related contingent consideration | 0 | ||
Estimate of Fair Value Measurement | Level 2 | Term Loan B Facility Due 2026 | Secured Debt | |||
Financial Liabilities: | |||
Convertible senior notes | 371,250 | ||
Estimate of Fair Value Measurement | Level 2 | Convertible Senior Notes Due 2025 | Unsecured Debt | |||
Financial Liabilities: | |||
Convertible senior notes | 499,603 | ||
Estimate of Fair Value Measurement | Level 2 | Convertible Senior Notes Due 2024 | Unsecured Debt | |||
Financial Liabilities: | |||
Convertible senior notes | 8,662 | ||
Estimate of Fair Value Measurement | Level 2 | Convertible Senior Notes Due 2022 | Unsecured Debt | |||
Financial Liabilities: | |||
Convertible senior notes | 163,600 | ||
Estimate of Fair Value Measurement | Level 3 | |||
Financial Assets: | |||
Equity investments | 25,627 | ||
Convertible notes receivable | 5,364 | ||
Financial Liabilities: | |||
Acquisition-related contingent consideration | 56,527 | ||
Estimate of Fair Value Measurement | Level 3 | Term Loan B Facility Due 2026 | Secured Debt | |||
Financial Liabilities: | |||
Convertible senior notes | 0 | ||
Estimate of Fair Value Measurement | Level 3 | Convertible Senior Notes Due 2025 | Unsecured Debt | |||
Financial Liabilities: | |||
Convertible senior notes | 0 | ||
Estimate of Fair Value Measurement | Level 3 | Convertible Senior Notes Due 2024 | Unsecured Debt | |||
Financial Liabilities: | |||
Convertible senior notes | 0 | ||
Estimate of Fair Value Measurement | Level 3 | Convertible Senior Notes Due 2022 | Unsecured Debt | |||
Financial Liabilities: | |||
Convertible senior notes | $ 0 | ||
Closing sale price (in dollars per share) | $ 76.32 | ||
Convertible Senior Notes Due 2025 | |||
Financial Liabilities: | |||
Stated interest rate (as a percent) | 0.75% | ||
Closing sale price (in dollars per share) | $ 54.17 | ||
Initial conversion price of notes into common stock (in dollars per share) | $ 71.78 | $ 71.78 | |
Debt instrument, convertible, conversion premium (in shares) | 0.3 | ||
Conversion premium amount | $ 25,500 | ||
Convertible Senior Notes Due 2025 | Maximum | |||
Financial Liabilities: | |||
Debt instrument, convertible, conversion premium (in shares) | 5.6 | ||
Convertible Senior Notes Due 2025 | Unsecured Debt | |||
Financial Liabilities: | |||
Stated interest rate (as a percent) | 0.75% | 0.75% | |
Convertible Senior Notes Due 2024 | Unsecured Debt | |||
Financial Liabilities: | |||
Stated interest rate (as a percent) | 3.375% | ||
Convertible Senior Notes Due 2022 | |||
Financial Liabilities: | |||
Stated interest rate (as a percent) | 2.375% | ||
Convertible Senior Notes Due 2022 | Unsecured Debt | |||
Financial Liabilities: | |||
Stated interest rate (as a percent) | 2.375% | 2.375% | 2.375% |
FINANCIAL INSTRUMENTS - Schedul
FINANCIAL INSTRUMENTS - Schedule of Investments Without Readily Determinable Fair Value (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Investments Without Readily Determinable Fair Value Roll Forward [Abstract] | |
Balance at December 31, 2021 | $ 18,259 |
Purchases | 12,750 |
Foreign currency adjustments | (18) |
Balance at March 31, 2022 | 30,991 |
Equity Investments | |
Investments Without Readily Determinable Fair Value Roll Forward [Abstract] | |
Balance at December 31, 2021 | 14,127 |
Purchases | 11,500 |
Foreign currency adjustments | 0 |
Balance at March 31, 2022 | 25,627 |
Convertible Notes Receivable | |
Investments Without Readily Determinable Fair Value Roll Forward [Abstract] | |
Balance at December 31, 2021 | 4,132 |
Purchases | 1,250 |
Foreign currency adjustments | (18) |
Balance at March 31, 2022 | $ 5,364 |
FINANCIAL INSTRUMENTS - Narrati
FINANCIAL INSTRUMENTS - Narrative (Details) | Nov. 19, 2021USD ($)$ / shares | Dec. 31, 2021USD ($) | Apr. 30, 2019USD ($) | Mar. 31, 2022USD ($)customer | Mar. 31, 2021USD ($) | Dec. 31, 2021USD ($)segment |
Concentration Risk [Line Items] | ||||||
Changes in contingent consideration | $ 1,071,000 | $ 1,127,000 | ||||
Interest receivable | $ 100,000 | $ 400,000 | $ 100,000 | |||
Number of major customers | 3 | 4 | ||||
Amount of allowance for doubtful accounts | 0 | $ 0 | $ 0 | |||
Accounts receivable | Concentration risk by major customer | Major customer one | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk (as a percent) | 34.00% | 30.00% | ||||
Accounts receivable | Concentration risk by major customer | Major customer two | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk (as a percent) | 19.00% | 20.00% | ||||
Accounts receivable | Concentration risk by major customer | Major customer three | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk (as a percent) | 19.00% | 17.00% | ||||
Accounts receivable | Concentration risk by major customer | Major customer four | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk (as a percent) | 11.00% | |||||
Myoscience Acquisition | ||||||
Concentration Risk [Line Items] | ||||||
Acquisition-related contingent consideration | 11,200,000 | $ 10,900,000 | $ 11,200,000 | |||
Changes in contingent consideration | (277,000) | $ (1,127,000) | ||||
Contingent consideration | $ 100,000,000 | |||||
Payment term | 60 days | |||||
Contingent consideration, current | $ 43,000,000 | |||||
Myoscience Acquisition | Contingent Consideration | Measurement Input, Discount Rate | Level 3 | ||||||
Concentration Risk [Line Items] | ||||||
Measurement input, contingent consideration | 0.113 | |||||
Myoscience Acquisition | Contingent Consideration | Measurement Input, Expected Milestone Payment | Level 3 | ||||||
Concentration Risk [Line Items] | ||||||
Measurement input, contingent consideration | 0.010 | |||||
Flexion Acquisition | ||||||
Concentration Risk [Line Items] | ||||||
Acquisition-related contingent consideration | 46,400,000 | $ 45,600,000 | 46,400,000 | |||
Changes in contingent consideration | $ (45,200,000) | (1,200,000) | $ 800,000 | |||
Flexion Acquisition | Contingent Consideration | Measurement Input, Discount Rate | Level 3 | Weighted Average | ||||||
Concentration Risk [Line Items] | ||||||
Measurement input, contingent consideration | 0.126 | |||||
Flexion Acquisition | Contingent Consideration | Measurement Input, Probability of Success of Regulatory Milestones | Level 3 | Weighted Average | ||||||
Concentration Risk [Line Items] | ||||||
Measurement input, contingent consideration | 0.117 | |||||
Flexion Acquisition | Contingent Consideration | ||||||
Concentration Risk [Line Items] | ||||||
Increase to CVR | $ / shares | $ 0.02 | |||||
Flexion And MyoScience Acquisition | ||||||
Concentration Risk [Line Items] | ||||||
Acquisition-related contingent consideration | $ 57,600,000 | $ 56,500,000 | $ 57,600,000 |
FINANCIAL INSTRUMENTS - Fair _2
FINANCIAL INSTRUMENTS - Fair Value Measurement Inputs and Valuation (Details) - Fair Value, Inputs, Level 3 - Contingent Consideration | Mar. 31, 2022 |
Myoscience Acquisition | Measurement Input, Discount Rate | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Measurement input, contingent consideration | 0.113 |
Myoscience Acquisition | Measurement Input, Expected Milestone Payment | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Measurement input, contingent consideration | 0.010 |
Minimum | Myoscience Acquisition | Measurement Input, Discount Rate | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Measurement input, contingent consideration | 0.1023 |
Minimum | Myoscience Acquisition | Measurement Input, Expected Milestone Payment | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Measurement input, contingent consideration | 0.01 |
Minimum | Flexion Acquisition | Measurement Input, Discount Rate | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Measurement input, contingent consideration | 0.1150 |
Minimum | Flexion Acquisition | Measurement Input, Expected Milestone Payment | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Measurement input, contingent consideration | 0.05 |
Maximum | Myoscience Acquisition | Measurement Input, Discount Rate | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Measurement input, contingent consideration | 0.1228 |
Maximum | Flexion Acquisition | Measurement Input, Discount Rate | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Measurement input, contingent consideration | 0.1365 |
Maximum | Flexion Acquisition | Measurement Input, Expected Milestone Payment | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Measurement input, contingent consideration | 0.15 |
FINANCIAL INSTRUMENTS - Fair _3
FINANCIAL INSTRUMENTS - Fair Value of Contingent Consideration Rollforward (Details) - Contingent Consideration $ in Thousands | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Balance at December 31, 2021 | $ 57,598 |
Fair value adjustments and accretion | (1,071) |
Balance at March 31, 2022 | $ 56,527 |
FINANCIAL INSTRUMENTS - Sched_2
FINANCIAL INSTRUMENTS - Schedule of Available-For-Sale Securities (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Fair Value Measurements | ||
Cost | $ 226,413 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | (970) | |
Fair Value (Level 2) | 225,443 | |
Short-term: | ||
Fair Value Measurements | ||
Cost | $ 70,651 | |
Gross Unrealized Gains | 182 | |
Gross Unrealized Losses | (2) | |
Fair Value (Level 2) | 70,831 | |
Asset-backed securities | Short-term: | ||
Fair Value Measurements | ||
Cost | 32,213 | 3,182 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (216) | 0 |
Fair Value (Level 2) | 31,997 | 3,182 |
Commercial paper | Short-term: | ||
Fair Value Measurements | ||
Cost | 164,140 | 57,533 |
Gross Unrealized Gains | 0 | 80 |
Gross Unrealized Losses | (630) | (2) |
Fair Value (Level 2) | 163,510 | 57,611 |
Corporate bonds | Short-term: | ||
Fair Value Measurements | ||
Cost | 12,503 | 9,936 |
Gross Unrealized Gains | 0 | 102 |
Gross Unrealized Losses | (115) | 0 |
Fair Value (Level 2) | 12,388 | $ 10,038 |
U.S. Government bonds | Short-term: | ||
Fair Value Measurements | ||
Cost | 17,557 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | (9) | |
Fair Value (Level 2) | $ 17,548 |
STOCKHOLDERS' EQUITY (Details)
STOCKHOLDERS' EQUITY (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Balance at beginning of period | $ 730,408 | $ 619,688 |
Net unrealized loss on investments, net of tax | (733) | (150) |
Balance at end of period | 709,576 | 650,818 |
Net Unrealized Gains (Losses) From Available For Sale Investments | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Balance at beginning of period | 139 | 319 |
Net unrealized loss on investments, net of tax | (733) | (150) |
Balance at end of period | (594) | 169 |
Unrealized Foreign Currency Translation | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Balance at beginning of period | 28 | (1) |
Foreign currency translation adjustments | 39 | 4 |
Balance at end of period | 67 | 3 |
Accumulated Other Comprehensive Income (Loss) | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Balance at beginning of period | 167 | 318 |
Net unrealized loss on investments, net of tax | (733) | (150) |
Foreign currency translation adjustments | 39 | 4 |
Balance at end of period | $ (527) | $ 172 |
STOCK PLANS - Schedule of Stock
STOCK PLANS - Schedule of Stock Based Compensation Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Share-Based Compensation | ||
Stock-based compensation expense | $ 11,189 | $ 10,110 |
Stock-based compensation from: | ||
Stock options | 6,785 | 6,496 |
Restricted stock units | 4,113 | 3,392 |
Employee stock purchase plan | 291 | 222 |
Total | 11,189 | 10,110 |
Cost of goods sold | ||
Share-Based Compensation | ||
Stock-based compensation expense | 1,352 | 1,452 |
Research and development | ||
Share-Based Compensation | ||
Stock-based compensation expense | 1,458 | 1,106 |
Selling, general and administrative | ||
Share-Based Compensation | ||
Stock-based compensation expense | $ 8,379 | $ 7,552 |
STOCK PLANS - Schedule of Sto_2
STOCK PLANS - Schedule of Stock Based Compensation Activity (Details) | 3 Months Ended |
Mar. 31, 2022$ / sharesshares | |
Number of Options | |
Outstanding beginning of period (in shares) | shares | 6,050,540 |
Granted (in shares) | shares | 120,200 |
Exercised (in shares) | shares | (323,201) |
Forfeited (in shares) | shares | (33,535) |
Expired (in shares) | shares | (13,054) |
Outstanding end of period (in shares) | shares | 5,800,950 |
Weighted Average Exercise Price | |
Outstanding beginning of period (in dollars per share) | $ / shares | $ 49.32 |
Granted (in dollars per share) | $ / shares | 62.24 |
Exercised (in dollars per share) | $ / shares | 34.28 |
Forfeited (in dollars per share) | $ / shares | 52.56 |
Expired (in dollars per share) | $ / shares | 85.48 |
Outstanding at end of period (in dollars per share) | $ / shares | $ 50.33 |
Restricted Stock Units (RSUs) | |
Number of Units | |
Unvested at beginning of period (shares) | shares | 955,277 |
Granted (shares) | shares | 64,700 |
Vested (shares) | shares | (6,950) |
Forfeited (shares) | shares | (31,074) |
Unvested at end of period (shares) | shares | 981,953 |
Weighted Average Grant Date Fair Value (Per Share) | |
Unvested at beginning of period (usd per share) | $ / shares | $ 52.85 |
Granted (usd per share) | $ / shares | 62.34 |
Vested (usd per share) | $ / shares | 62.35 |
Forfeited (usd per share) | $ / shares | 53.76 |
Unvested at end of period (usd per share) | $ / shares | $ 53.38 |
STOCK PLANS - Narrative (Detail
STOCK PLANS - Narrative (Details) | 3 Months Ended |
Mar. 31, 2022offeringPeriod$ / sharesshares | |
Stock Incentive Plans | |
Weighted average fair value (in dollars per share) | $ / shares | $ 27.71 |
Purchase price of common stock, ESPP (as a percent) | 85.00% |
Shares issued under employee stock purchase plan (in shares) | shares | 0 |
ESPP | |
Stock Incentive Plans | |
Number of offering periods for ESPP | offeringPeriod | 2 |
ESPP purchasing period | 6 months |
STOCK PLANS - Schedule of Valua
STOCK PLANS - Schedule of Valuation Assumptions (Details) - Employee Stock Option | 3 Months Ended |
Mar. 31, 2022 | |
Stock Incentive Plans | |
Expected dividend yield (as a percent) | 0.00% |
Risk free interest rate (as a percent) | 1.44% |
Expected volatility (as a percent) | 48.55% |
Expected term of options (in years) | 5 years 3 months 18 days |
NET INCOME (LOSS) PER SHARE - S
NET INCOME (LOSS) PER SHARE - Schedule of Computation of EPS (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Numerator: | ||
Net income | $ 6,828 | $ 10,369 |
Denominator: | ||
Weighted average common shares outstanding - basic (in shares) | 44,869 | 43,833 |
Computation of diluted securities: | ||
Dilutive effect of conversion premium on the 2022 Notes (in shares) | 0 | 152 |
Weighted average number of shares outstanding - diluted (in shares) | 46,438 | 45,966 |
Net income per share: | ||
Basic net income per common share (in USD per share) | $ 0.15 | $ 0.24 |
Diluted net income per common share (in USD per share) | $ 0.15 | $ 0.23 |
Employee Stock Option | ||
Computation of diluted securities: | ||
Dilutive effect of share based compensation arrangements (in shares) | 1,195 | 1,507 |
Restricted Stock Units (RSUs) | ||
Computation of diluted securities: | ||
Dilutive effect of share based compensation arrangements (in shares) | 373 | 470 |
ESPP | ||
Computation of diluted securities: | ||
Dilutive effect of share based compensation arrangements (in shares) | 1 | 4 |
NET INCOME (LOSS) PER SHARE -_2
NET INCOME (LOSS) PER SHARE - Schedule of Antidilutive Securities (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
EARNINGS PER SHARE | ||
Total | 9,779 | 892 |
Employee Stock Option | ||
EARNINGS PER SHARE | ||
Total | 1,762 | 890 |
Restricted Stock Units (RSUs) | ||
EARNINGS PER SHARE | ||
Total | 17 | 2 |
Convertible senior notes | ||
EARNINGS PER SHARE | ||
Total | 8,000 | 0 |
INCOME TAXES - Schedule of Fede
INCOME TAXES - Schedule of Federal, State and Local, and Foreign Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Income (loss) before income taxes: | ||
Domestic | $ 6,582 | $ 15,933 |
Foreign | 712 | (3,209) |
Income before income taxes | $ 7,294 | $ 12,724 |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
Income tax expense | $ (466) | $ (2,355) |
ACQUISITION_RELATED CHARGES, _3
ACQUISITION–RELATED CHARGES, PRODUCT DISCONTINUATION AND OTHER - Product Discontinuance (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Restructuring Cost and Reserve [Line Items] | ||
Severance-related expenses | $ 3,115 | $ 0 |
Total acquisition-related charges | 5,408 | 0 |
Contingent consideration | 1,071 | 1,127 |
Total acquisition-related charges, product discontinuation and other | 4,337 | 1,873 |
Nuance Biotech Co. Ltd. | ||
Restructuring Cost and Reserve [Line Items] | ||
Nuance Biotech Co. Ltd. agreement dissolution costs | 0 | 3,000 |
Flexion | ||
Restructuring Cost and Reserve [Line Items] | ||
Contingent consideration | (794) | 0 |
Myoscience Acquisition | ||
Restructuring Cost and Reserve [Line Items] | ||
Contingent consideration | (277) | (1,127) |
Acquisition Related Fees | ||
Restructuring Cost and Reserve [Line Items] | ||
Acquisition-related costs | 1,845 | 0 |
Other Restructuring | ||
Restructuring Cost and Reserve [Line Items] | ||
Acquisition-related costs | $ 448 | $ 0 |
ACQUISITION_RELATED CHARGES, _4
ACQUISITION–RELATED CHARGES, PRODUCT DISCONTINUATION AND OTHER - Narrative (Details) - USD ($) $ in Thousands | Nov. 19, 2021 | Dec. 31, 2021 | Mar. 31, 2022 | Mar. 31, 2021 |
Business Acquisition [Line Items] | ||||
Changes in contingent consideration | $ (1,071) | $ (1,127) | ||
Nuance Biotech Co. Ltd. | ||||
Business Acquisition [Line Items] | ||||
Estimated settlement fees | 3,000 | |||
Flexion Acquisition | ||||
Business Acquisition [Line Items] | ||||
Changes in contingent consideration | $ 45,200 | $ 1,200 | (800) | |
Flexion Acquisition | Legal Fees | ||||
Business Acquisition [Line Items] | ||||
Acquisition-related costs | 5,400 | |||
Myoscience Acquisition | ||||
Business Acquisition [Line Items] | ||||
Changes in contingent consideration | $ 277 | $ 1,127 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Millions | 1 Months Ended |
Oct. 31, 2020USD ($) | |
Fortis | |
Loss Contingencies [Line Items] | |
Loss contingency, damages sought | $ 30 |