Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Feb. 22, 2017 | Jun. 30, 2016 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | PBYI | ||
Entity Registrant Name | PUMA BIOTECHNOLOGY, INC. | ||
Entity Central Index Key | 1,401,667 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 36,951,978 | ||
Entity Public Float | $ 505,788,174 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 194,494 | $ 31,569 |
Marketable securities | 34,982 | 184,320 |
Prepaid expenses and other, current | 6,998 | 7,660 |
Total current assets | 236,474 | 223,549 |
Property and equipment, net | 5,153 | 2,383 |
Prepaid expenses and other, long-term | 6,846 | 9,597 |
Restricted cash | 4,317 | 4,313 |
Total assets | 252,790 | 239,842 |
Current liabilities: | ||
Accounts payable | 20,035 | 17,803 |
Accrued expenses | 17,426 | 14,639 |
Total current liabilities | 37,461 | 32,442 |
Deferred rent | 5,505 | 1,393 |
Total liabilities | 42,966 | 33,835 |
Commitments and contingencies (Note 9) | ||
Stockholders' equity: | ||
Common stock - $.0001 par value; 100,000,000 shares authorized; 36,826,010 issued and outstanding at December 31, 2016, and 32,466,842 issued and outstanding at December 31, 2015 | 4 | 3 |
Additional paid-in capital | 1,006,344 | 726,651 |
Accumulated other comprehensive loss | (13) | (147) |
Accumulated deficit | (796,511) | (520,500) |
Total stockholders' equity | 209,824 | 206,007 |
Total liabilities and stockholders' equity | $ 252,790 | $ 239,842 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 |
Statement Of Financial Position [Abstract] | ||
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 36,826,010 | 32,466,842 |
Common stock, shares outstanding | 36,826,010 | 32,466,842 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Operating expenses: | |||
General and administrative | $ 53,798 | $ 31,808 | $ 19,358 |
Research and development | 222,798 | 208,472 | 122,917 |
Totals | 276,596 | 240,280 | 142,275 |
Loss from operations | (276,596) | (240,280) | (142,275) |
Other income (expenses): | |||
Interest income | 958 | 971 | 324 |
Other income (expense) | (373) | 25 | (14) |
Totals | 585 | 996 | 310 |
Net loss | (276,011) | (239,284) | (141,965) |
Net loss applicable to common stock | $ (276,011) | $ (239,284) | $ (141,965) |
Net loss per common share—basic and diluted | $ (8.29) | $ (7.45) | $ (4.73) |
Weighted-average common shares outstanding—basic and diluted | 33,295,114 | 32,126,094 | 30,010,979 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Statement Of Income And Comprehensive Income [Abstract] | |||
Net loss | $ (276,011) | $ (239,284) | $ (141,965) |
Other comprehensive income (loss) | |||
Unrealized gain (loss) on available-for-sale securities | 134 | (52) | (98) |
Comprehensive loss | $ (275,877) | $ (239,336) | $ (142,063) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Receivables from the Exercise of Options | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit |
Beginning Balance at Dec. 31, 2013 | $ 83,987 | $ 3 | $ 223,232 | $ 3 | $ (139,251) | |
Beginning Balance (in shares) at Dec. 31, 2013 | 28,991,289 | |||||
Stock-based compensation | 39,151 | 39,151 | ||||
Exercises of stock options | $ 6,533 | 7,368 | $ (835) | |||
Exercises of stock options (in shares) | 430,490 | 430,490 | ||||
Issuance of common stock | $ 129,440 | 129,440 | ||||
Issuance of common stock (in shares) | 1,126,530 | |||||
Unrealized gain (loss) on available-for-sale securities | (98) | (98) | ||||
Net loss | (141,965) | (141,965) | ||||
Ending Balance at Dec. 31, 2014 | 117,048 | $ 3 | 399,191 | (835) | (95) | (281,216) |
Ending Balance (in shares) at Dec. 31, 2014 | 30,548,309 | |||||
Stock-based compensation | 94,934 | 94,934 | ||||
Exercises of stock options | $ 28,228 | 27,393 | $ 835 | |||
Exercises of stock options (in shares) | 757,038 | 757,038 | ||||
Issuance of performance shares (in shares) | 11,495 | |||||
Issuance of common stock | $ 205,133 | 205,133 | ||||
Issuance of common stock (in shares) | 1,150,000 | |||||
Unrealized gain (loss) on available-for-sale securities | (52) | (52) | ||||
Net loss | (239,284) | (239,284) | ||||
Ending Balance at Dec. 31, 2015 | $ 206,007 | $ 3 | 726,651 | (147) | (520,500) | |
Ending Balance (in shares) at Dec. 31, 2015 | 32,466,842 | 32,466,842 | ||||
Stock-based compensation | $ 117,264 | 117,264 | ||||
Exercises of stock options | $ 576 | 576 | ||||
Exercises of stock options (in shares) | 43,751 | 46,668 | ||||
Issuance of common stock | $ 161,854 | $ 1 | 161,853 | |||
Issuance of common stock (in shares) | 4,312,500 | |||||
Unrealized gain (loss) on available-for-sale securities | 134 | 134 | ||||
Net loss | (276,011) | (276,011) | ||||
Ending Balance at Dec. 31, 2016 | $ 209,824 | $ 4 | $ 1,006,344 | $ (13) | $ (796,511) | |
Ending Balance (in shares) at Dec. 31, 2016 | 36,826,010 | 36,826,010 |
Consolidated Statements of Sto7
Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Statement Of Stockholders Equity [Abstract] | |||
Issuance of common stock, per share | $ 40 | $ 190 | $ 122.50 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Operating activities: | |||
Net loss | $ (276,011) | $ (239,284) | $ (141,965) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Depreciation and amortization | 1,149 | 776 | 627 |
Build-out allowance received from landlord | 2,997 | 179 | 192 |
Disposal of leasehold improvements | 368 | ||
Stock-based compensation expense | 117,264 | 94,934 | 39,151 |
Changes in operating assets and liabilities: | |||
Licensor receivable | 1,760 | 8,053 | |
Prepaid expenses and other | 3,413 | (958) | (8,584) |
Accounts payable | 2,231 | 2,806 | 4,305 |
Accrued expenses | 2,787 | (14,805) | 20,865 |
Accrual of deferred rent | 4,112 | 124 | 153 |
Net cash used in operating activities | (141,690) | (154,468) | (77,203) |
Investing activities: | |||
Purchase of property and equipment | (4,287) | (1,002) | (1,100) |
Expenditures for leasehold improvements | (2,997) | (179) | (192) |
Restricted cash | (4) | (3,098) | (1) |
Purchase of available-for-sale securities | (81,794) | (214,806) | (132,259) |
Sale/maturity of available-for-sale securities | 231,267 | 133,222 | 70,277 |
Net cash provided by (used in) investing activities | 142,185 | (85,863) | (63,275) |
Financing activities: | |||
Net proceeds from issuance of common stock | 161,854 | 205,133 | 129,440 |
Net proceeds from exercise of options | 576 | 28,228 | 6,533 |
Net cash provided by financing activities | 162,430 | 233,361 | 135,973 |
Net increase (decrease) in cash and cash equivalents | 162,925 | (6,970) | (4,505) |
Cash and cash equivalents, beginning of year | 31,569 | 38,539 | 43,044 |
Cash and cash equivalents, end of year | $ 194,494 | $ 31,569 | 38,539 |
Supplemental disclosures of non-cash investing and financing activities: | |||
Receivables from the exercise of options | $ 835 |
Business and Basis of Presentat
Business and Basis of Presentation | 12 Months Ended |
Dec. 31, 2016 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Business and Basis of Presentation | Note 1—Business and Basis of Presentation: Business: Puma Biotechnology, Inc., or Puma, is a biopharmaceutical company based in Los Angeles, California. References in these Notes to Consolidated Financial Statements to the “Company” refer to Puma Biotechnology, Inc., a private Delaware company formed on September 15, 2010, or Private Puma, for periods prior to the merger of Private Puma with Public Puma (as defined below), which took place on October 4, 2011, or the Merger, and Puma Biotechnology, Inc., a Delaware company formed on April 27, 2007, and formerly known as Innovative Acquisitions Corp., or Public Puma, for periods following the Merger. The Company is a biopharmaceutical company with a focus on the development and commercialization of innovative products to enhance cancer care. The Company in-licenses the global development and commercialization rights to three drug candidates—PB272 (neratinib (oral)), PB272 (neratinib (intravenous)) and PB357. Neratinib is a potent irreversible tyrosine kinase inhibitor, or TKI, that blocks signal transduction through the epidermal growth factor receptors, HER1, HER2 and HER4. Currently, the Company is primarily focused on the development of the oral version of neratinib, and its most advanced drug candidates are directed at the treatment of HER2-positive breast cancer. The Company believes neratinib has clinical application in the treatment of several other cancers as well, including non-small cell lung cancer and other tumor types that over-express or have a mutation in HER2. In November 2012, the Company established and incorporated Puma Biotechnology Ltd., a wholly owned subsidiary, for the sole purpose of serving as Puma’s legal representative in the United Kingdom and the European Union in connection with Puma’s clinical trial activity in those countries. Basis of Presentation: The Company is focused on developing neratinib for the treatment of patients with human epidermal growth factor receptor type 2, or HER2-positive, breast cancer, HER2 mutated non-small cell lung cancer, HER2-negative breast cancer that has a HER2 mutation and other solid tumors that have an activating mutation in HER2. The Company has reported a net loss of approximately $276.0 million and negative cash flows from operations of approximately $141.7 million for the year ended December 31, 2016. Management believes that the Company will continue to incur net losses and negative net cash flows from operating activities through the drug development process and into the early commercialization stage. The Company has incurred significant operating losses since its inception, which raises substantial doubt about its ability to continue as a going concern. The Company has not yet launched its first commercial product and is currently exploring methods by which to commercialize its product candidates if approved by the FDA or EMA. These methods may require funding in addition to the cash and cash equivalents and marketable securities totaling approximately $229.4 million available at December 31, 2016. While the consolidated financial statements have been prepared on a going concern basis, the Company continues to remain dependent on its ability to obtain sufficient funding to sustain operation and successfully commercially launch neratinib if approved by the FDA or EMA. While the Company has been successful in raising financing in the past, there can be no assurance that it will be able to do so in the future. The Company’s ability to obtain funding may be adversely impacted by uncertain market conditions, unfavorable decisions of regulatory authorities or adverse clinical trial results. The outcome of these matters cannot be predicted at this time. If the going concern assumption was not appropriate for the preparation of the consolidated financial statements, adjustment might be necessary to the consolidated financial statements. The Company’s continued operations will depend on its ability to raise funds through various potential sources, such as equity and debt financing. Through December 31, 2016, the Company’s financing was primarily through public offerings of Company common stock and private equity placements. The Company sold additional shares of its common stock through an underwritten public offering in October 2016 (see Note 6). As a result, the Company received net proceeds of approximately $161.9 million. The Company may need additional financing until it can achieve profitability, if ever. There can be no assurance that additional capital will be available on favorable terms or at all or that any additional capital that the Company is able to obtain will be sufficient to meet its needs. If it is unable to raise additional capital, the Company could likely be forced to curtail desired development activities, which will delay the development of its product candidates. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Note 2—Significant Accounting Policies: The significant accounting policies followed in the preparation of these consolidated financial statements are as follows: Use of Estimates: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America, or GAAP, requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the balance sheet and reported amounts of expenses for the period presented. Accordingly, actual results could differ from those estimates. Significant estimates include accrued expenses for the cost of services provided by consultants who manage clinical trials and conduct research and clinical trials on behalf of the Company that are billed on a delayed basis. As the actual costs become known, the Company adjusts its estimated cost in that period. The value of stock-based compensation includes estimates based on future events, which are difficult to predict. It is at least reasonably possible that a change in the estimates used to record accrued expenses and to value stock-based compensation will occur in the near term. Principles of Consolidation: The Consolidated Financial Statements include the accounts of the Company and its wholly owned subsidiary. All significant intercompany balances and transactions have been eliminated in consolidation. Cash and Cash Equivalents: The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents. Cash equivalents are carried at cost, which approximates fair value. Licensor Receivable: Pfizer, Inc., or the Licensor, receivable represents the remaining external “out of pocket” clinical trial costs in excess of an agreed upon “cap” for clinical trials that were ongoing at the time the licensing agreement with the Licensor was reached. In July 2014, the license agreement was amended to make the Company solely responsible for the expenses incurred or accrued in conducting the ongoing legacy clinical trials after December 31, 2013, and to fix the future royalty rate that must be paid to the Licensor upon commercialization in the low to mid-teens. Investment Securities: The Company classifies all investment securities (short term and long term) as available-for-sale, as the sale of such securities may be required prior to maturity to implement management’s strategies. These securities are carried at fair value, with the unrealized gains and losses, reported as a component of accumulated other comprehensive loss in stockholders’ equity until realized. Realized gains and losses from the sale of available-for-sale securities, if any, are determined on a specific identification basis. A decline in the market value of any available-for-sale security below cost that is determined to be other than temporary results in a revaluation of its carrying amount to fair value. The impairment is charged to earnings and a new cost basis for the security is established. Premiums and discounts are amortized or accreted over the life of the related security as an adjustment to yield using the straight-line method. Interest income is recognized when earned. Assets Measured at Fair Value on a Recurring Basis: Accounting Standards Codification, or “ASC”, 820, Fair Value Measurement Level 1: Quoted prices in active markets for identical assets or liabilities. Level 2: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs are observable in active markets. Level 3: Valuations derived from valuation techniques in which one or more significant inputs are unobservable. Following are the major categories of assets measured at fair value on a recurring basis as of December 31, 2016 and 2015, using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3) (in thousands): December 31, 2016 Level 1 Level 2 Level 3 Total Cash equivalents $ 188,543 $ — $ — $ 188,543 Marketable securities — — 28,984 — 28,984 Marketable securities—commercial paper — 5,998 — 5,998 $ 188,543 $ 34,982 $ — $ 223,525 December 31, 2015 Level 1 Level 2 Level 3 Total Cash equivalents $ 29,166 $ — $ — $ 29,166 Marketable securities—corporate bonds — 169,824 — 169,824 Marketable securities—commercial paper — 2,996 — 2,996 Marketable securities—US government — 11,500 — 11,500 $ 29,166 $ 184,320 $ — $ 213,486 The Company’s investments in corporate bonds, commercial paper and U.S. government securities are exposed to price fluctuations. The fair value measurements for corporate bonds, commercial paper and U.S. government securities are based upon the quoted prices of similar items in active markets multiplied by the number of securities owned, exclusive of any transaction costs and without any adjustments to reflect discounts that may be applied to selling a large block of securities at one time. Concentration of Risk: Financial instruments, which potentially subject the Company to concentrations of credit risk, principally consist of cash and cash equivalents. The Company’s cash and cash equivalents in excess of the Federal Deposit Insurance Corporation and the Securities Investor Protection Corporation insured limits at December 31, 2016, were approximately $199.0 million. The Company does not believe it is exposed to any significant credit risk due to the quality nature of the financial instruments in which the money is held. Pursuant to the Company’s internal investment policy, investments must be rated A-1/P-1 or better by Standard and Poor’s Rating Service and Moody’s Investors Service at the time of purchase. Property and Equipment: Property and equipment are recorded at cost and depreciated over estimated useful lives ranging from three to five years using the straight-line method. Leasehold improvements are recorded at cost and amortized over the shorter of their useful lives or the term of the lease by use of the straight-line method. Maintenance and repair costs are charged to operations as incurred. The Company assesses the impairment of long-lived assets, primarily property and equipment, whenever events or changes in business circumstances indicate that carrying amounts of the assets may not be fully recoverable. When such events occur, management determines whether there has been impairment by comparing the asset’s carrying value with its fair value, as measured by the anticipated undiscounted net cash flows of the asset. Should impairment exist, the asset is written down to its estimated fair value. The Company recorded a loss from disposal of leasehold improvements during 2016 when it vacated one suite in its South San Francisco office location in favor of another suite. The Company has not recognized any impairment losses through December 31, 2016. Research and Development Expenses: Research and development expenses, or R&D, are charged to operations as incurred. The major components of research and development costs include clinical manufacturing costs, clinical trial expenses, consulting and other third-party costs, salaries and employee benefits, stock-based compensation expense, supplies and materials, and allocations of various overhead costs. Clinical trial expenses include, but are not limited to, investigator fees, site costs, comparator drug costs, and clinical research organization, or CRO, costs. In the normal course of business, the Company contracts with third parties to perform various clinical trial activities in the ongoing development of potential products. The financial terms of these agreements are subject to negotiation and variations from contract to contract and may result in uneven payment flows. Payments under the contracts depend on factors such as the achievement of certain events, the successful enrollment of patients and the completion of portions of the clinical trial or similar conditions. The Company’s accruals for clinical trials are based on estimates of the services received and efforts expended pursuant to contracts with numerous clinical trial sites, cooperative groups and CROs. The objective of the Company’s accrual policy is to match the recording of expenses in the Consolidated Financial Statements to the actual services received and efforts expended. As actual costs become known, the Company adjusts its accruals in that period. In instances where the Company enters into agreements with third parties for clinical trials and other consulting activities, upfront amounts are recorded to prepaid expenses and other in the accompanying Consolidated Balance Sheets and expensed as services are performed or as the underlying goods are delivered. If the Company does not expect the services to be rendered or goods to be delivered, any remaining capitalized amounts for non-refundable upfront payments are charged to expense immediately. Amounts due under such arrangements may be either fixed fee or fee for service, and may include upfront payments, monthly payments and payments upon the completion of milestones or receipt of deliverables. Costs related to the acquisition of technology rights and patents for which development work is still in process are charged to operations as incurred and considered a component of research and development costs. Research and Development Reimbursement: The license agreement with the Licensor set a “cap” on the amount of external expenses the Company would incur, beginning January 1, 2012, in completing the clinical trials transferred from the Licensor to the Company. The license agreement originally stipulated that the Licensor would be responsible for all external expenses associated with the transferred clinical trials and that the Company would invoice for such costs on a quarterly basis. The Licensor had 60 days to review the invoice and supporting documentation. All amounts reimbursed from the licensor represent charges for services provided by third parties and not the Company. Accordingly, the Company has elected to treat the reimbursed costs as “pass-through” expenses billable to the Licensor and as an offset to R&D expenses. R&D expenses are recorded net of any excess cap costs billed to the Licensor. The Company recognized approximately $16.4 million of excess cap cost billed to the Licensor for the year ended December 31, 2013. The license agreement was amended in July 2014 and made the Company solely responsible for the expenses incurred or accrued in conducting the ongoing legacy clinical trials after December 31, 2013. Pursuant to the amendment to the original license agreement, no reduction in the expenses related to the licensor legacy clinical trials that were in excess of the cap on such expenses set forth in the license agreement was recorded in the years ended December 31, 2016, 2015 and 2014. Stock-Based Compensation: Stock option awards: ASC 718, Compensation-Stock Compensation Performance shares: The performance Warrants: Warrants granted to employees are normally valued at the fair value of the instrument on the grant date and are recognized in the statement of operations over the requisite service period. When the requisite service period precedes the grant date and a market condition exists in the warrant, the Company values the warrant using the Monte Carlo Simulation Method. When the terms of the warrant become fixed, the Company values the warrant using the Black-Scholes Option Pricing Method. As allowed by ASC 718 for companies with a short period of publicly traded stock history, the Company’s estimate of expected volatility is based on the average volatilities of a sampling of eight to nine companies with similar attributes to the Company, including industry, stage of life cycle, size and financial leverage. The risk-free rate for periods within the contractual life of the warrant is based on the U.S. Treasury yield curve in effect at the time of grant valuation. In determining the value of the warrant until the terms are fixed, the Company factors in the probability of the market condition occurring and several possible scenarios. When the requisite service period precedes the grant date and is deemed to be complete, the Company records the fair value of the warrant at the time of issuance as an equity stock-based compensation transaction. The warrant is revalued each reporting period up to the grant date when the final fair value of the warrant is established and recorded. The grant date is determined when all pertinent information, such as exercise price and quantity are known. Restricted stock units: The restricted stock units, or RSUs, are valued on the grant date and the fair value of the RSUs is equal to the market price of the Company’s common stock on the grant date. The RSU expense is recognized over the requisite service period. When the requisite service period begins prior to the grant date (because the service inception date occurs prior to the grant date), the Company is required to begin recognizing compensation cost before there is a measurement date (i.e., the grant date). The service inception date is the beginning of the requisite service period. If the service inception date precedes the grant date, accrual of compensation cost for periods before the grant date shall be based on the fair value of the award at the reporting date. In the period in which the grant date occurs, cumulative compensation cost shall be adjusted to reflect the cumulative effect of measuring compensation cost based on fair value at the grant date rather than the fair value previously used at the service inception date (or any subsequent reporting date). Income Taxes: The Company follows ASC 740, Income Taxes , The standard addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the consolidated financial statements. Under ASC 740, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the tax authorities, based on the technical merits of the position. The tax benefits recognized in the consolidated financial statements from such a position should be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. ASC 740 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. At the date of adoption, and as of December 31, 2016 and 2015, the Company did not have a liability for unrecognized tax uncertainties. The Company is subject to routine audits by taxing jurisdictions. As of December 31, 2016, the Company’s tax years for 2013, 2014 and 2015 are subject to examination by the authorities. The Company’s policy is to record interest and penalties on uncertain tax positions as income tax expense. As of December 31, 2016 and 2015, the Company had no accrued interest or penalties related to uncertain tax positions. Net Loss per Common Share: Basic net loss per common share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares outstanding during the periods presented as required by ASC 260, Earnings per Share Deferred Rent: The Company has entered into operating lease agreements for its corporate offices in Los Angeles and South San Francisco that contain provisions for future rent increases, leasehold improvement allowances and rent abatements. The Company records monthly rent expense equal to the total of the payments due over the lease term, divided by the number of months of the lease term. The difference between the rent expense recorded and the amount paid is credited or charged to deferred rent, which is reflected as a separate line item in the accompanying Consolidated Balance Sheets. Additionally, the Company recorded as deferred rent the cost of the leasehold improvements paid by the landlord, which is amortized on a straight-line basis over the term of the lease. Issuance of Common Stock Upon Exercise of Stock Option Grants: When a stock option grant or partial stock option grant is exercised, the Company notifies its transfer agent to release the required number of common stock shares from the reserve for the Company’s 2011 Incentive Award Plan. The Company records the transaction for the cash received and the issuance of common shares. Should there be a delay in the cash receipts due to the settlement period, the Company records a receivable from the exercise of an option as part of stockholders’ equity on the Consolidated Balance Sheet. Recently Issued Accounting Standards In January 2016, the Financial Accounting Standards Board, or FASB, issued ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities In February 2016, the FASB issued ASU No. 2016-02, Leases In March 2016, the FASB issued ASU No. 2016-06, Derivatives and Hedging Contingent Put and Call Options in Debt Instruments In March 2016, the FASB issued ASU No. 2016-09, Compensation – Stock Compensation In April 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers Revenue from Contracts with Customers Revenue from Contracts with Customers Deferral of the Effective Date In May 2016, the FASB issued ASU No. 2016-12, Revenue from Contracts with Customers Revenue from Contracts with Customers Revenue from Contracts with Customers Deferral of the Effective Date In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows : Classification of Certain Cash Receipts and Cash Payments In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows Restricted Cash |
Prepaid Expenses and Other
Prepaid Expenses and Other | 12 Months Ended |
Dec. 31, 2016 | |
Banking And Thrift [Abstract] | |
Prepaid Expenses and Other | Note 3—Prepaid Expenses and Other: Prepaid expenses and other consisted of the following at December 31 (in thousands): 2016 2015 Current: CRO services $ 3,471 $ 2,969 Other clinical development 1,069 2,309 Insurance 1,159 1,138 Other 1,299 1,244 6,998 7,660 Long-term: CRO services 5,077 5,754 Other clinical development 1,243 3,005 Insurance 40 87 Other 486 751 6,846 9,597 Totals $ 13,844 $ 17,257 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2016 | |
Property Plant And Equipment [Abstract] | |
Property and Equipment | Note 4—Property and Equipment: Property and equipment consisted of the following at December 31 (in thousands): Property and Equipment: 2016 2015 Leasehold improvements $ 3,878 $ 1,502 Computer equipment 1,822 1,646 Telephone equipment 256 169 Furniture and fixtures 2,146 1,167 8,102 4,484 Less: accumulated depreciation and amortization (2,949 ) (2,101 ) Totals $ 5,153 $ 2,383 |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Dec. 31, 2016 | |
Payables And Accruals [Abstract] | |
Accrued Expenses | Note 5—Accrued Expenses: Accrued expenses consisted of the following at December 31 (in thousands): 2016 2015 Accrued CRO/licensor services $ 6,609 $ 8,436 Accrued other clinical development 7,015 3,618 Accrued legal fees 706 443 Accrued compensation 3,058 1,970 Other 38 172 Totals $ 17,426 $ 14,639 Accrued CRO/licensor services and accrued other clinical development represent the Company’s estimate of such costs as of December 31, 2016 and 2015, which will be adjusted in the period the actual costs become known. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Stockholders' Equity | Note 6—Stockholders’ Equity: Common Stock: October 2012 Common Stock Offering. On October 18, 2012, the Company entered into an underwriting agreement with Merrill Lynch, Pierce, Fenner & Smith Incorporated and Leerink Swann, as representatives of several underwriters, providing for the offer and sale in a firm-commitment underwritten public offering of 7,500,000 shares of the Company’s common stock, par value $0.0001 per share, at a price of $16.00 per share, less the underwriting discount. On October 19, 2012, the underwriters exercised the option granted to the underwriters to purchase an additional 1,125,000 shares of Company common stock from the Company at $16.00 per share, less the underwriting discount. The transactions were completed on October 24, 2012; the Company received net proceeds of approximately $129.2 million, which is comprised of gross proceeds of approximately $138 million, offset by the underwriting discount and estimated offering expenses of $8.8 million payable by the Company. February 2014 Common Stock Offering. On February 10, 2014, the Company entered into an underwriting agreement with Merrill Lynch, Pierce, Fenner & Smith Incorporated, Citigroup, and Leerink Partners, as representatives of several underwriters, providing for the offer and sale in a firm-commitment underwritten public offering of 979,592 shares of the Company’s common stock, par value $0.0001 per share, at a price of $122.50 per share, less the underwriting discount. On February 12, 2014, the underwriters exercised the option granted to the underwriters to purchase an additional 146,938 shares of Company common stock from the Company at $122.50 per share, less the underwriting discount. The transactions were completed on February 14, 2014; the Company received net proceeds of approximately $129.4 million, which is comprised of gross proceeds of approximately $138.0 million, offset by the underwriting discount and offering expenses of $8.6 million payable by the Company. January 2015 Common Stock Offering. On January 21, 2015, the Company entered into an underwriting agreement with Merrill Lynch, Pierce, Fenner & Smith Incorporated and J.P. Morgan Securities, as representatives of several underwriters, providing for the offer and sale in a firm-commitment underwritten public offering of 1,000,000 shares of the Company’s common stock, par value $0.0001 per share, at a price of $190.00 per share, less the underwriting discount. The underwriters exercised the option granted to the underwriters to purchase an additional 150,000 shares of Company common stock from the Company at $190.00 per share, less the underwriting discount. The transactions were completed on January 27, 2015; the Company received net proceeds of approximately $205.1 million, which is comprised of gross proceeds of approximately $218.5 million, offset by the underwriting discount and offering expenses of $13.4 million payable by the Company. October 2016 Common Stock Offering. On October 19, 2016, the Company entered into an underwriting agreement in connection with the public offering, issuance and sale by the Company of 3,750,000 shares of the Company’s common stock, par value $0.0001 per share, at a public offering price of $40.00 per share, less underwriting discounts and commissions. Under the terms of the underwriting agreement, the Company also granted the underwriters an option exercisable for 30 days to purchase up to an additional 562,500 shares of its common stock at the public offering prices, less underwriting discounts and commissions. On October 20, 2016, the underwriters exercised their option to purchase additional shares in full. The Company received net proceeds from the offering of approximately $161.9 million, after deducting underwriting discounts and commissions and estimated offering expenses. The Company issued 46,668, 757,038, and 430,490 shares of common stock upon exercise of stock options during the years ended December 31, 2016, 2015 and 2014, respectively. Authorized Shares: The Company had 110,000,000 shares of stock authorized for issuance, of which 100,000,000 were common stock, par value $0.0001 per share, and 10,000,000 were preferred stock, par value $0.0001 per share. On October 4, 2011, the Board of Directors of the Company and the stockholders owning 100% of the Company’s issued and outstanding common stock approved an Amended and Restated Certificate of Incorporation, or the Amended Certificate, which eliminated the Company’s entire authorized class of preferred stock and reduced the total number of shares of capital stock that the Company may issue from 110,000,000 shares to 100,000,000 shares, all of which are designated as common stock, par value $0.0001 per share. The Amended Certificate became effective on November 14, 2011, upon the filing of the Amended Certificate with the Secretary of State of the State of Delaware. Warrants: Following the October 2011 common stock offering, Mr. Auerbach held approximately 21% of the 18,666,733 outstanding shares of the Company’s common stock. Pursuant to the terms of the securities purchase agreement, the Company issued an anti-dilutive warrant to Mr. Auerbach, as the Company’s founder. The warrant was issued to provide Mr. Auerbach with the right to maintain ownership of at least 20% of the Company’s common stock in the event that the Company raised capital through the sale of its securities in the future. In connection with the closing of a public offering on October 24, 2012, the exercise price and number of shares underlying the warrant issued to Mr. Auerbach were established and, accordingly, the final value of the warrant became fixed. Pursuant to the terms of the warrant, Mr. Auerbach may exercise the warrant to acquire 2,116,250 shares of the Company’s common stock at $16 per share until October 4, 2021. Performance Shares: During January 2014, performance share awards were granted to certain employees that provide for a maximum of 28,411 common stock shares to be issued. These shares vest over three years on the first, second and third anniversary of December 15, 2013. On each vesting date, if the Company’s closing common stock price is equal to $102.46 per share, one-third of the 28,411 shares will be awarded. If the Company’s closing common stock price is either lesser or greater than $102.46 per share, the number of common stock shares to be issued will be adjusted to be less than one-third of the 28,411 shares. No shares will be awarded if the Company’s closing common stock price is less than $47.53 per share at the vesting dates. The performance shares are valued on the grant date and the fair value of the performance award is equal to the market price of the Company’s common stock on the grant date. The performance share expense is recognized based on the Company’s estimate of a range of probabilities that the Company’s closing common stock price will be lower or higher than $102.46 on the vesting dates. Based on the range of probabilities, the expense is calculated and recognized over the three-year vesting period. On December 15, 2016, the final vesting occurred and the calculations were performed. As a result, no shares of common stock were issued to the employees and the remaining 9,469 performance shares were cancelled. Previously, o Stock Options: The Company’s 2011 Incentive Award Plan, or the 2011 Plan, was adopted by the Board of Directors on September 15, 2011. Pursuant to the 2011 Plan, the Company may grant incentive stock options and nonqualified stock options, as well as other forms of equity-based compensation. Incentive stock options may be granted only to employees, while consultants, employees, officers and directors are eligible for the grant of nonqualified options under the 2011 Plan. The maximum term of stock options granted under the 2011 Plan is 10 years. The exercise price of incentive stock options granted under the 2011 Plan must be at least equal to the fair value of such shares on the date of grant. Through December 31, 2016, a total of 10,529,412 shares of the Company’s common stock have been reserved for issuance under the 2011 Plan. The Company awarded only “plain vanilla options” as determined by the SEC Staff Accounting Bulletin 107, or Share Based Payment 2016 2015 2014 Dividend yield 0.0 % 0.0 % 0.0 % Expected volatility 68.1 % 64.5 % 74.4 % Risk-free interest rate 1.7 % 1.6 % 1.8 % Expected life in years 5.80 5.82 5.85 Employee stock-based compensation was as follows for the years ended December 31 (in thousands except per share data): 2016 2015 2014 Stock-based compensation: Options- Research and development, or R&D $ 88,049 $ 76,995 $ 28,446 General and administrative, or G&A 25,043 17,166 9,154 Restricted stock units- G&A 1,580 — — R&D 3,120 — — Performance shares: R&D (528 ) 773 1,551 Total share-based compensation expense $ 117,264 $ 94,934 $ 39,151 Impact on basic and diluted net loss per share $ 3.52 $ 2.96 $ 1.30 Weighted average shares (basic and diluted) 33,295,114 32,126,094 30,010,979 Activity with respect to options granted under the 2011 Plan is summarized as follows: Shares Weighted Average Exercise Price Weighted Contractual Term (years) Aggregate Intrinsic Value (in thousands) Outstanding at December 31, 2013 2,604,224 $ 23.31 8.9 $ 208,902 Granted 1,980,208 $ 159.62 9.2 — Forfeited (175,816 ) $ 67.08 — — Exercised (430,490 ) $ 17.12 — $ 74,109 Outstanding at December 31, 2014 3,978,126 $ 89.55 8.7 $ 431,635 Granted 2,606,183 $ 117.62 9.4 — Forfeited (277,140 ) $ 177.98 — — Exercised (757,038 ) $ 36.19 — $ 102,149 Expired (7,846 ) $ 105.42 Outstanding at December 31, 2015 5,542,285 $ 105.59 8.6 $ 87,632 Granted 1,658,465 $ 42.34 9.3 Forfeited (446,544 ) $ 122.50 Exercised (43,751 ) $ 13.16 $ 1,360 Expired (131,933 ) $ 185.10 Outstanding at December 31, 2016 6,578,522 $ 87.52 8.0 $ 18,442 Unvested at December 31, 2016 3,106,083 $ 80.00 9.1 $ 171 Exercisable at December 31, 2016 3,472,439 $ 94.24 7.0 $ 18,271 At December 31, 2016, total estimated unrecognized employee compensation cost related to non-vested stock options granted prior to that date was approximately $132.1 million, which is expected to be recognized over a weighted-average period of 1.7 years. At December 31, 2016 , the total estimated unrecognized employee compensation cost related to non-vested restricted stock units was approximately $29.7 million, which is expected to be recognized over a weighted-average period of 2.6 years. The weighted-average grant date fair value of options granted during the years ended December 31, 2016, 2015 and 2014, was $25.69, $68.30 and $101.17 per share, respectively. The weighted average grant date fair value of restricted stock units awarded during the year ended December 31, 2016, was $54.35. Weighted Average Grant-Date Stock options Shares Fair Value Nonvested shares at December 31, 2015 3,572,202 $ 73.59 Granted 1,658,465 25.69 Vested/Issued (1,678,040 ) 77.69 Forfeited (446,544 ) 73.22 Nonvested shares at December 31, 2016 3,106,083 $ 47.78 Weighted Average Grant-Date Performance shares Shares Fair Value Nonvested shares at December 31, 2015 9,469 $ 102.46 Granted — 102.46 Vested/Issued — 102.46 Cancelled (9,469 ) 102.46 Nonvested shares at December 31, 2016 — $ 102.46 Weighted Average Grant-Date Restricted stock units Shares Fair Value Nonvested shares at December 31, 2015 — $ — Granted 640,644 54.35 Vested/Issued (2,917 ) 54.35 Cancelled (7,219 ) 54.35 Nonvested shares at December 31, 2016 630,508 $ 54.35 |
401(k) Savings Plan
401(k) Savings Plan | 12 Months Ended |
Dec. 31, 2016 | |
Postemployment Benefits [Abstract] | |
401(k) Savings Plan | Note 7—401(k) Savings Plan: During 2012, the Company adopted a 401(k) savings plan for the benefit of its employees. The Company is required to make matching contributions to the 401(k) plan equal to 100% of the first 3% of wages deferred by each participating employee and 50% on the next 2% of wages deferred by each participating employee. The Company incurred expenses for employer matching contributions of approximately $1.0 million, $0.7 million and $0.5 million for the years ended December 31, 2016, 2015 and 2014, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 8—Income Taxes: Temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes give rise to the Company’s deferred income taxes. The components of the Company’s net deferred tax assets as of December 31, 2016 and 2015 are as follows (in thousands): Federal State Total Deferred tax assets—2016: Net operating loss carry forwards $ 178,654 $ 30,654 $ 209,308 Business credit carryforwards 14,257 6,999 21,256 Organization costs 151 26 177 Compensation 71,987 12,354 84,341 Deferred rent - leasehold improvement 1,019 175 1,194 Other 852 145 997 266,920 50,353 317,273 Deferred tax liabilities (1,083 ) (186 ) (1,269 ) Total deferred tax assets 265,837 50,167 316,004 Valuation allowance (265,837 ) (50,167 ) (316,004 ) Net deferred tax assets $ — $ — $ — Federal State Total Deferred tax assets—2015: Net operating loss carry forwards $ 125,244 $ 21,489 $ 146,733 Business credit carryforwards 11,528 6,373 17,901 Organization costs 166 29 195 Compensation 38,138 6,545 44,683 Depreciation 180 30 210 Other 53 9 62 175,309 34,475 209,784 Deferred tax liabilities — — — Total deferred tax assets 175,309 34,475 209,784 Valuation allowance (175,309 ) (34,475 ) (209,784 ) Net deferred tax assets $ — $ — $ — As the ultimate realization of the potential benefits of the Company’s deferred tax assets is considered unlikely by management, the Company has offset the deferred tax assets attributable to those potential benefits through valuation allowances. Accordingly, the Company did not recognize any benefit from income taxes in the accompanying Consolidated Statements of Operations to offset its pre-tax losses. The valuation allowance increased $106.2 million in 2016 and $101.4 million in 2015. At December 31, 2016, the Company had federal and state net operating loss carryforwards of approximately $525.5 million each, which will begin to expire in 2031. At December 31, 2016, the Company also has federal and state research and development credit carryforwards of approximately $14.3 million and $10.6 million, respectively. Pursuant to the Internal Revenue Code, Sections 382 and 383, use of the Company’s net operating loss and credit carryforwards could be limited if a cumulative change in ownership of more than 50% occurs within a three-year period. The Company has not yet performed an assessment on the potential limitation on net operating loss and credit carryforwards. As a result of certain realization requirements of ASC 718, the table of deferred tax assets and liabilities shown above does not include certain deferred tax assets as of December 31, 2016 and 2015 that arose directly from (or the use of which was postponed by) tax deductions related to equity compensation in excess of compensation recognized for financial reporting. Those deferred tax assets include federal and state net operating losses. Equity will be increased by approximately $0.1 million if and when such deferred tax assets are ultimately realized. The Company uses ASC 740 ordering when determining when excess tax benefits have been realized. The provision (credit) for income taxes in the accompanying Consolidated Statements of Operations differs from the amount calculated by applying the statutory income tax rate to income (loss) from continuing operations before income taxes. The primary components of such differences are as follows as of December 31 (in thousands): 2016 2015 2014 Tax computed at the federal statutory rate $ (93,839 ) $ (81,356 ) $ (48,268 ) State taxes (15,693 ) (16,620 ) (8,465 ) Permanent items 6,152 4,225 9,956 R&D credits (2,728 ) (5,029 ) (3,697 ) Other (113 ) (2,571 ) 690 Change in valuation allowance 106,221 101,351 49,784 Total provision $ — $ — $ — The following is a tabular reconciliation of the total amounts of unrecognized tax benefits at December 31: (in thousands) 2016 2015 2014 Unrecognized tax benefits—January 1 $ 4,475 $ 2,482 $ 1,263 Gross decreases—tax positions in prior period — — (205 ) Gross increases—tax positions in current period 840 1,993 1,424 Unrecognized tax benefits—December 31 $ 5,315 $ 4,475 $ 2,482 The unrecognized tax benefits that, if recognized, would affect the effective tax rate is zero at December 31, 2015. The Company does not have tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefit will significantly increase or decrease within 12 months of the reporting date. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 9—Commitments and Contingencies: Office Leases: On December 7, 2011, the Company, entered into a non-cancelable operating lease for office space. The initial term of the lease is for seven years and commenced on December 10, 2011. The base rent was approximately $44,400 per month during the first year and will increase each year during the initial term, up to approximately $53,000 per month during the seventh year. The lease has an expiration date of December 9, 2018. In addition, the Company has an option to extend the lease for an additional five-year term. The lease is subject to additional charges for common area maintenance and other costs. Concurrent with the execution of the lease, the Company provided the landlord an automatically renewable stand-by letter of credit in the amount of $2,500,000. The stand-by letter of credit is collateralized by a high-yield savings account which is classified as restricted cash on the accompanying Consolidated Balance Sheets. Rent expense for the years ended December 31, 2016, 2015, and 2014, was approximately $3,547,300, $1,597,200 and $1,126,700, respectively. On June 7, 2012, the Company entered into a long-term lease agreement for office space in South San Francisco, California. The initial term of the lease is seven years and commenced on November 1, 2012. The base rent was approximately $20,250 per month during the first year and will increase over the course of the initial term, up to approximately $30,820 per month during the seventh year. In addition, the Company has an option to extend the lease for an additional five-year term, which would commence upon the expiration of the initial term. In the event the Company elects to extend the lease, the minimum monthly rent payable for the additional term will be the then-current fair market rent calculated in accordance with the terms of the lease. The Company provided the landlord an automatically renewable stand-by letter of credit in the amount of $1,591,400. The stand-by letter of credit is collateralized by a high-yield savings account which is classified as restricted cash on the accompanying Consolidated Balance Sheets. On November 28, 2012, the Company entered into an amendment to the lease for its office space in Los Angeles, California. This amendment added approximately 3,500 rentable square feet to the existing lease of approximately 13,250 square feet. Pursuant to the amendment, the Company’s monthly rent increased by approximately $12,145 per month following the execution of the amendment and will be increased to approximately $14,080 per month at the end of the lease term. On December 1, 2013, the Company entered into a second amendment to the lease for its office space in Los Angeles, California. This amendment added approximately 5,949 rentable square feet to the existing lease of approximately 16,750 square feet. Pursuant to the amendment, the Company’s monthly rent increased by approximately $10,400 per month following the execution of the amendment and will be increased to approximately $25,100 per month at the end of the lease term. On March 18, 2014, the Company entered into a third amendment to the lease of its office space in Los Angeles, California. This amendment added approximately 2,908 rentable square feet to the existing lease of approximately 22,775 square feet. Pursuant to the amendment, the Company’s monthly rent expense increased by approximately $11,487 per month following the execution of the amendment and will be increased to approximately $12,928 per month at the end of the lease term. On May 19, 2014, the Company entered into a first amendment to the lease of its office space in South San Francisco, California. This amendment added approximately 7,152 rentable square feet to the existing lease of approximately 9,560 square feet. Pursuant to the amendment, the Company’s monthly rent expense increased by approximately $22,886 per month following the execution of the amendment and will be increased to approximately $27,328 per month during the last year of the lease term. In July 2015, the Company amended its lease with CA-10880 Wilshire Limited Partnership to expand the rented square feet in its Los Angeles office by approximately 26,000 square feet. The lease commenced April 1, 2016, and increased the monthly rent in the Los Angeles location by approximately $150,000 per month with annual increases of approximately 3% per year for the 10-year lease term. The amendment also extended the term of the lease until March 2026. In addition, in July 2015, the Company amended its office lease with PR 701 Gateway, LLC (as successor in interest to DWF III Gateway, LLC) to expand the rented square feet in its South San Francisco location by approximately 13,000 square feet. The lease commenced April 1, 2016, and increased the monthly rent in the South San Francisco location by approximately $51,400 with annual increases of approximately 3% per year for the 10-year lease term. The amendment also extended the term of the lease until March 2026. Future minimum lease payments for each of the years subsequent to December 31, 2016, are as follows (in thousands): Year Ending December 31, Amount 2017 $ 3,977 2018 4,096 2019 4,219 2020 4,345 Thereafter 24,733 Total $ 41,370 License Agreement: In August 2011, the Company entered into an agreement pursuant to which Pfizer, Inc., or the Licensor, agreed to grant it a worldwide license for the development, manufacture and commercialization of PB272 neratinib (oral), PB272 neratinib (intravenous) and PB357, and certain related compounds. The license is exclusive with respect to certain patent rights owned by or licensed to the Licensor. Under the agreement, the Company is obligated to commence a new clinical trial for a product containing one of these compounds within a specified period of time and to use commercially reasonable efforts to complete clinical trials and to achieve certain milestones as provided in a development plan. From the closing date of the agreement through December 31, 2011, the Licensor continued to conduct the existing clinical trials on behalf of the Company at the Licensor’s sole expense. At the Company’s request, the Licensor has agreed to continue to perform certain services in support of the existing clinical trials at the Company’s expense. These services will continue through the completion of the transitioned clinical trials. The license agreement “capped” the out of pocket expense the Company would be responsible for completing the then existing clinical trials. All agreed upon costs incurred by the Company above the “cost cap” would be reimbursed by the Licensor. The Company exceeded the “cost cap” during the fourth quarter of 2012. In accordance with the license agreement, the Company billed the Licensor for agreed upon costs above the “cost cap” until December 31, 2013. On July 18, 2014, the Company entered into an amendment to the license agreement with the Licensor. The amendment amends the License Agreement to (1) reduce the royalty rate payable by the Company to the Licensor on sales of licensed products; (2) release the Licensor from its obligation to pay for certain out-of-pocket costs incurred or accrued on or after January 1, 2014 to complete certain ongoing clinical studies; and (3) provide that the Licensor and the Company will continue to cooperate to effect the transfer to the Company of certain records, regulatory filings, materials and inventory controlled by Licensor as promptly as reasonably practicable. As consideration for the license, the Company is required to make substantial payments upon the achievement of certain milestones totaling approximately $187.5 million if all such milestones are achieved. Should the Company commercialize any of the compounds licensed from the Licensor or any products containing any of these compounds, the Company will be obligated to pay to the Licensor annual royalties at a fixed rate in the low-to-mid teens of net sales of all such products, subject to certain reductions and offsets in some circumstances. The Company’s royalty obligation continues, on a product-by-product and country-by-country basis, until the later of (1) the last to expire licensed patent covering the applicable licensed product in such country, or (2) the earlier of generic competition for such licensed product reaching a certain level in such country or expiration of a certain time period after first commercial sale of such licensed product in such country. In the event that the Company sublicenses the rights granted to the Company under the license agreement with the Licensor to a third party, the same milestone and royalty payments are required. The Company can terminate the license agreement at will at any time after April 4, 2013, or for safety concerns, in each case upon specified advance notice. Clinical Trial Contracts: The Company engages with clinical research organizations and contract manufacturing organizations, or CMOs, in addition to engaging in contracts for the management of its ongoing clinical trials and pre-commercialization efforts. The Company may cancel these agreements with a 30 to 45 day written notice to the outside vendor. The Company would be obligated to pay for services rendered up to that point. The contracts also contain variable costs that are hard to predict as they are based on such things as patients enrolled and clinical trial sites, which can vary and therefore, are not included in the table below. The contracts held by the Company as of December 31, 2016, are summarized as follows (in thousands): Indication Estimated Contractual Obligations as of December 31, 2016 Months Remaining on Contract HER2 Overexpressed/Amplified Breast Cancer (Extension) $ 22,844 20 HER2 Overexpressed/Amplified Breast Cancer (Licensor Legacy Clinical Trials) 1,541 12 HER2 Mutated Non-Small Cell Lung Cancer 338 12 HER2 Mutated Breast Cancer and HER2 Mutated Breast Cancer with Brain Mets 3,962 18 Metastatic & Adjuvant Breast Cancer 47,865 21 Neoadjuvant Breast Cancer 4,537 20 Preclinical Research 22,557 13 HER2 Mutated Solid Tumors 12,946 12 Other 6,487 12 Total $ 123,077 Included in the above are payments to be made when milestones are reached. As of December 31, 2016, Company obligations for potential milestone payments totaled approximately $22.7 million. This amount will be paid by the Company if all milestones are reached and would reduce the overall contractual obligation if one or more milestone is never reached. Legal : The Company currently has four pending legal proceedings in which it is named as a defendant. On June 3, 2015, Hsingching Hsu, individually and on behalf of all others similarly situated, filed a class action lawsuit against the Company and certain of its executive officers in the United States District Court for the Central District of California (Case No. 8:15-cv-00865-AG-JCG). On October 16, 2015, lead Plaintiff Norfolk Pension Fund filed an amended complaint on behalf of all persons who purchased the Company’s securities between July 22, 2014 and May 29, 2015. The amended complaint alleges that the Company and certain of its executive officers made false and/or misleading statements and failed to disclose material adverse facts about the Company’s business, operations, prospects and performance in violation of Sections 10(b) (and Rule 10b-5 promulgated thereunder) and 20(a) of the Exchange Act. The plaintiff seeks damages, interest, costs, attorneys' fees, and other unspecified equitable relief. On November 30, 2015, the Company filed a motion to dismiss the amended complaint. The plaintiff opposed this motion, and the court heard oral argument on March 14, 2016. On September 30, 2016, the court denied the Company’s motion to dismiss. The court set a trial for November 6, 2018. On February 2, 2016, Fredric N. Eshelman filed a lawsuit against the Company’s Chief Executive Officer and President, Alan H. Auerbach, and the Company in the United States District Court for the Eastern District of North Carolina (Case No. 7:16-cv-00018-D). The complaint generally alleges that Mr. Auerbach and the Company made defamatory statements regarding Dr. Eshelman in connection with a proxy contest. Dr. Eshelman seeks compensatory and punitive damages and expenses and costs, including attorneys’ fees. On April 4, 2016, the defendants filed a motion to dismiss the complaint. On May 2, 2016, Dr. Eshelman filed a notice of voluntary dismissal of the claims against Mr. Auerbach. On February 6, 2017, the court denied the Company’s motion to dismiss. On February 21, 2017, the Company filed an answer to Dr. Eshelman’s complaint and brought counterclaims against Dr. Eshelman for defamatory statements regarding the Company made by him in connection with the proxy contest. The court has set a schedule for discovery to be conducted through September 2017. On April 12 and April 14, 2016, alleged shareholders filed two derivative lawsuits purportedly on behalf of the Company against certain of the Company’s officers and directors in the Superior Court of the State of California, Los Angeles, captioned Xing Xie v. Alan H. Auerbach, et al., No. BC616617, and Kevin McKenney v. Auerbach, et al., No. BC617059. The complaints assert claims for breach of fiduciary duty, unjust enrichment, abuse of control, mismanagement and waste of corporate assets arising from substantially similar allegations as those contained in the putative securities class action described above. The complaints seek an unspecified sum of damages and equitable relief. The Company believes that these cases are without merit and the Company intends to vigorously defend itself against these cases. It is impossible to determine a potential dollar figure for the lawsuits as a contingent loss. |
Quarterly Financial Data
Quarterly Financial Data | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Data | Note 10—Quarterly Financial Data: Quarterly financial data (in thousands except share and per share data): (unaudited) Three Months Ended March 31, June 30, September 30, December 31, 2016 Revenues $ — $ — $ — $ — Net loss (70,972 ) (66,597 ) (65,781 ) (72,661 ) Net loss applicable to common stock (70,972 ) (66,597 ) (65,781 ) (72,661 ) Net loss per share—basic and diluted $ (2.19 ) $ (2.05 ) $ (2.02 ) $ (2.04 ) Weighted-average common shares outstanding—basic and diluted 32,478,408 32,493,092 32,497,168 35,694,193 2015 Revenues $ — $ — $ — $ — Net loss (52,454 ) (64,694 ) (60,417 ) (61,719 ) Net loss applicable to common stock (52,454 ) (64,694 ) (60,417 ) (61,719 ) Net loss per share—basic and diluted $ (1.66 ) $ (2.01 ) $ (1.87 ) $ (1.90 ) Weighted-average common shares outstanding—basic and diluted 31,588,315 32,158,108 32,303,203 32,444,270 2014 Revenues $ — $ — $ — $ — Net loss (19,794 ) (38,844 ) (35,844 ) (47,483 ) Net loss applicable to common stock (19,794 ) (38,844 ) (35,844 ) (47,483 ) Net loss per share—basic and diluted $ (0.67 ) $ (1.29 ) $ (1.19 ) $ (1.57 ) Weighted-average common shares outstanding—basic and diluted 29,567,071 30,117,819 30,117,819 30,232,718 |
Significant Accounting Polici19
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America, or GAAP, requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the balance sheet and reported amounts of expenses for the period presented. Accordingly, actual results could differ from those estimates. Significant estimates include accrued expenses for the cost of services provided by consultants who manage clinical trials and conduct research and clinical trials on behalf of the Company that are billed on a delayed basis. As the actual costs become known, the Company adjusts its estimated cost in that period. The value of stock-based compensation includes estimates based on future events, which are difficult to predict. It is at least reasonably possible that a change in the estimates used to record accrued expenses and to value stock-based compensation will occur in the near term. |
Principles of Consolidation | Principles of Consolidation: The Consolidated Financial Statements include the accounts of the Company and its wholly owned subsidiary. All significant intercompany balances and transactions have been eliminated in consolidation. |
Cash and Cash Equivalents | Cash and Cash Equivalents: The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents. Cash equivalents are carried at cost, which approximates fair value. |
Licensor Receivable | Licensor Receivable: Pfizer, Inc., or the Licensor, receivable represents the remaining external “out of pocket” clinical trial costs in excess of an agreed upon “cap” for clinical trials that were ongoing at the time the licensing agreement with the Licensor was reached. In July 2014, the license agreement was amended to make the Company solely responsible for the expenses incurred or accrued in conducting the ongoing legacy clinical trials after December 31, 2013, and to fix the future royalty rate that must be paid to the Licensor upon commercialization in the low to mid-teens. |
Investment Securities | Investment Securities: The Company classifies all investment securities (short term and long term) as available-for-sale, as the sale of such securities may be required prior to maturity to implement management’s strategies. These securities are carried at fair value, with the unrealized gains and losses, reported as a component of accumulated other comprehensive loss in stockholders’ equity until realized. Realized gains and losses from the sale of available-for-sale securities, if any, are determined on a specific identification basis. A decline in the market value of any available-for-sale security below cost that is determined to be other than temporary results in a revaluation of its carrying amount to fair value. The impairment is charged to earnings and a new cost basis for the security is established. Premiums and discounts are amortized or accreted over the life of the related security as an adjustment to yield using the straight-line method. Interest income is recognized when earned. |
Assets Measured at Fair Value on a Recurring Basis | Assets Measured at Fair Value on a Recurring Basis: Accounting Standards Codification, or “ASC”, 820, Fair Value Measurement Level 1: Quoted prices in active markets for identical assets or liabilities. Level 2: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs are observable in active markets. Level 3: Valuations derived from valuation techniques in which one or more significant inputs are unobservable. Following are the major categories of assets measured at fair value on a recurring basis as of December 31, 2016 and 2015, using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3) (in thousands): December 31, 2016 Level 1 Level 2 Level 3 Total Cash equivalents $ 188,543 $ — $ — $ 188,543 Marketable securities — — 28,984 — 28,984 Marketable securities—commercial paper — 5,998 — 5,998 $ 188,543 $ 34,982 $ — $ 223,525 December 31, 2015 Level 1 Level 2 Level 3 Total Cash equivalents $ 29,166 $ — $ — $ 29,166 Marketable securities—corporate bonds — 169,824 — 169,824 Marketable securities—commercial paper — 2,996 — 2,996 Marketable securities—US government — 11,500 — 11,500 $ 29,166 $ 184,320 $ — $ 213,486 The Company’s investments in corporate bonds, commercial paper and U.S. government securities are exposed to price fluctuations. The fair value measurements for corporate bonds, commercial paper and U.S. government securities are based upon the quoted prices of similar items in active markets multiplied by the number of securities owned, exclusive of any transaction costs and without any adjustments to reflect discounts that may be applied to selling a large block of securities at one time. |
Concentration of Risk | Concentration of Risk: Financial instruments, which potentially subject the Company to concentrations of credit risk, principally consist of cash and cash equivalents. The Company’s cash and cash equivalents in excess of the Federal Deposit Insurance Corporation and the Securities Investor Protection Corporation insured limits at December 31, 2016, were approximately $199.0 million. The Company does not believe it is exposed to any significant credit risk due to the quality nature of the financial instruments in which the money is held. Pursuant to the Company’s internal investment policy, investments must be rated A-1/P-1 or better by Standard and Poor’s Rating Service and Moody’s Investors Service at the time of purchase. |
Property and Equipment | Property and Equipment: Property and equipment are recorded at cost and depreciated over estimated useful lives ranging from three to five years using the straight-line method. Leasehold improvements are recorded at cost and amortized over the shorter of their useful lives or the term of the lease by use of the straight-line method. Maintenance and repair costs are charged to operations as incurred. The Company assesses the impairment of long-lived assets, primarily property and equipment, whenever events or changes in business circumstances indicate that carrying amounts of the assets may not be fully recoverable. When such events occur, management determines whether there has been impairment by comparing the asset’s carrying value with its fair value, as measured by the anticipated undiscounted net cash flows of the asset. Should impairment exist, the asset is written down to its estimated fair value. The Company recorded a loss from disposal of leasehold improvements during 2016 when it vacated one suite in its South San Francisco office location in favor of another suite. The Company has not recognized any impairment losses through December 31, 2016. |
Research and Development Expenses | Research and Development Expenses: Research and development expenses, or R&D, are charged to operations as incurred. The major components of research and development costs include clinical manufacturing costs, clinical trial expenses, consulting and other third-party costs, salaries and employee benefits, stock-based compensation expense, supplies and materials, and allocations of various overhead costs. Clinical trial expenses include, but are not limited to, investigator fees, site costs, comparator drug costs, and clinical research organization, or CRO, costs. In the normal course of business, the Company contracts with third parties to perform various clinical trial activities in the ongoing development of potential products. The financial terms of these agreements are subject to negotiation and variations from contract to contract and may result in uneven payment flows. Payments under the contracts depend on factors such as the achievement of certain events, the successful enrollment of patients and the completion of portions of the clinical trial or similar conditions. The Company’s accruals for clinical trials are based on estimates of the services received and efforts expended pursuant to contracts with numerous clinical trial sites, cooperative groups and CROs. The objective of the Company’s accrual policy is to match the recording of expenses in the Consolidated Financial Statements to the actual services received and efforts expended. As actual costs become known, the Company adjusts its accruals in that period. In instances where the Company enters into agreements with third parties for clinical trials and other consulting activities, upfront amounts are recorded to prepaid expenses and other in the accompanying Consolidated Balance Sheets and expensed as services are performed or as the underlying goods are delivered. If the Company does not expect the services to be rendered or goods to be delivered, any remaining capitalized amounts for non-refundable upfront payments are charged to expense immediately. Amounts due under such arrangements may be either fixed fee or fee for service, and may include upfront payments, monthly payments and payments upon the completion of milestones or receipt of deliverables. Costs related to the acquisition of technology rights and patents for which development work is still in process are charged to operations as incurred and considered a component of research and development costs. |
Research and Development Reimbursement | Research and Development Reimbursement: The license agreement with the Licensor set a “cap” on the amount of external expenses the Company would incur, beginning January 1, 2012, in completing the clinical trials transferred from the Licensor to the Company. The license agreement originally stipulated that the Licensor would be responsible for all external expenses associated with the transferred clinical trials and that the Company would invoice for such costs on a quarterly basis. The Licensor had 60 days to review the invoice and supporting documentation. All amounts reimbursed from the licensor represent charges for services provided by third parties and not the Company. Accordingly, the Company has elected to treat the reimbursed costs as “pass-through” expenses billable to the Licensor and as an offset to R&D expenses. R&D expenses are recorded net of any excess cap costs billed to the Licensor. The Company recognized approximately $16.4 million of excess cap cost billed to the Licensor for the year ended December 31, 2013. The license agreement was amended in July 2014 and made the Company solely responsible for the expenses incurred or accrued in conducting the ongoing legacy clinical trials after December 31, 2013. Pursuant to the amendment to the original license agreement, no reduction in the expenses related to the licensor legacy clinical trials that were in excess of the cap on such expenses set forth in the license agreement was recorded in the years ended December 31, 2016, 2015 and 2014. |
Stock-Based Compensation | Stock-Based Compensation: Stock option awards: ASC 718, Compensation-Stock Compensation Performance shares: The performance Warrants: Warrants granted to employees are normally valued at the fair value of the instrument on the grant date and are recognized in the statement of operations over the requisite service period. When the requisite service period precedes the grant date and a market condition exists in the warrant, the Company values the warrant using the Monte Carlo Simulation Method. When the terms of the warrant become fixed, the Company values the warrant using the Black-Scholes Option Pricing Method. As allowed by ASC 718 for companies with a short period of publicly traded stock history, the Company’s estimate of expected volatility is based on the average volatilities of a sampling of eight to nine companies with similar attributes to the Company, including industry, stage of life cycle, size and financial leverage. The risk-free rate for periods within the contractual life of the warrant is based on the U.S. Treasury yield curve in effect at the time of grant valuation. In determining the value of the warrant until the terms are fixed, the Company factors in the probability of the market condition occurring and several possible scenarios. When the requisite service period precedes the grant date and is deemed to be complete, the Company records the fair value of the warrant at the time of issuance as an equity stock-based compensation transaction. The warrant is revalued each reporting period up to the grant date when the final fair value of the warrant is established and recorded. The grant date is determined when all pertinent information, such as exercise price and quantity are known. Restricted stock units: The restricted stock units, or RSUs, are valued on the grant date and the fair value of the RSUs is equal to the market price of the Company’s common stock on the grant date. The RSU expense is recognized over the requisite service period. When the requisite service period begins prior to the grant date (because the service inception date occurs prior to the grant date), the Company is required to begin recognizing compensation cost before there is a measurement date (i.e., the grant date). The service inception date is the beginning of the requisite service period. If the service inception date precedes the grant date, accrual of compensation cost for periods before the grant date shall be based on the fair value of the award at the reporting date. In the period in which the grant date occurs, cumulative compensation cost shall be adjusted to reflect the cumulative effect of measuring compensation cost based on fair value at the grant date rather than the fair value previously used at the service inception date (or any subsequent reporting date). |
Income Taxes | Income Taxes: The Company follows ASC 740, Income Taxes , The standard addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the consolidated financial statements. Under ASC 740, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the tax authorities, based on the technical merits of the position. The tax benefits recognized in the consolidated financial statements from such a position should be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. ASC 740 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. At the date of adoption, and as of December 31, 2016 and 2015, the Company did not have a liability for unrecognized tax uncertainties. The Company is subject to routine audits by taxing jurisdictions. As of December 31, 2016, the Company’s tax years for 2013, 2014 and 2015 are subject to examination by the authorities. The Company’s policy is to record interest and penalties on uncertain tax positions as income tax expense. As of December 31, 2016 and 2015, the Company had no accrued interest or penalties related to uncertain tax positions. |
Net Loss per Common Share | Net Loss per Common Share: Basic net loss per common share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares outstanding during the periods presented as required by ASC 260, Earnings per Share |
Deferred Rent | Deferred Rent: The Company has entered into operating lease agreements for its corporate offices in Los Angeles and South San Francisco that contain provisions for future rent increases, leasehold improvement allowances and rent abatements. The Company records monthly rent expense equal to the total of the payments due over the lease term, divided by the number of months of the lease term. The difference between the rent expense recorded and the amount paid is credited or charged to deferred rent, which is reflected as a separate line item in the accompanying Consolidated Balance Sheets. Additionally, the Company recorded as deferred rent the cost of the leasehold improvements paid by the landlord, which is amortized on a straight-line basis over the term of the lease. |
Issuance of Common Stock Upon Exercise of Stock Option Grants | Issuance of Common Stock Upon Exercise of Stock Option Grants: When a stock option grant or partial stock option grant is exercised, the Company notifies its transfer agent to release the required number of common stock shares from the reserve for the Company’s 2011 Incentive Award Plan. The Company records the transaction for the cash received and the issuance of common shares. Should there be a delay in the cash receipts due to the settlement period, the Company records a receivable from the exercise of an option as part of stockholders’ equity on the Consolidated Balance Sheet. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In January 2016, the Financial Accounting Standards Board, or FASB, issued ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities In February 2016, the FASB issued ASU No. 2016-02, Leases In March 2016, the FASB issued ASU No. 2016-06, Derivatives and Hedging Contingent Put and Call Options in Debt Instruments In March 2016, the FASB issued ASU No. 2016-09, Compensation – Stock Compensation In April 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers Revenue from Contracts with Customers Revenue from Contracts with Customers Deferral of the Effective Date In May 2016, the FASB issued ASU No. 2016-12, Revenue from Contracts with Customers Revenue from Contracts with Customers Revenue from Contracts with Customers Deferral of the Effective Date In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows : Classification of Certain Cash Receipts and Cash Payments In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows Restricted Cash |
Significant Accounting Polici20
Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Assets Measured at Fair Value on Recurring Basis | Following are the major categories of assets measured at fair value on a recurring basis as of December 31, 2016 and 2015, using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3) (in thousands): December 31, 2016 Level 1 Level 2 Level 3 Total Cash equivalents $ 188,543 $ — $ — $ 188,543 Marketable securities — — 28,984 — 28,984 Marketable securities—commercial paper — 5,998 — 5,998 $ 188,543 $ 34,982 $ — $ 223,525 December 31, 2015 Level 1 Level 2 Level 3 Total Cash equivalents $ 29,166 $ — $ — $ 29,166 Marketable securities—corporate bonds — 169,824 — 169,824 Marketable securities—commercial paper — 2,996 — 2,996 Marketable securities—US government — 11,500 — 11,500 $ 29,166 $ 184,320 $ — $ 213,486 |
Prepaid Expenses and Other (Tab
Prepaid Expenses and Other (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Banking And Thrift [Abstract] | |
Components of Prepaid Expenses and Other | Prepaid expenses and other consisted of the following at December 31 (in thousands): 2016 2015 Current: CRO services $ 3,471 $ 2,969 Other clinical development 1,069 2,309 Insurance 1,159 1,138 Other 1,299 1,244 6,998 7,660 Long-term: CRO services 5,077 5,754 Other clinical development 1,243 3,005 Insurance 40 87 Other 486 751 6,846 9,597 Totals $ 13,844 $ 17,257 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property Plant And Equipment [Abstract] | |
Property and Equipment | Property and equipment consisted of the following at December 31 (in thousands): Property and Equipment: 2016 2015 Leasehold improvements $ 3,878 $ 1,502 Computer equipment 1,822 1,646 Telephone equipment 256 169 Furniture and fixtures 2,146 1,167 8,102 4,484 Less: accumulated depreciation and amortization (2,949 ) (2,101 ) Totals $ 5,153 $ 2,383 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Payables And Accruals [Abstract] | |
Accrued Expenses | Accrued expenses consisted of the following at December 31 (in thousands): 2016 2015 Accrued CRO/licensor services $ 6,609 $ 8,436 Accrued other clinical development 7,015 3,618 Accrued legal fees 706 443 Accrued compensation 3,058 1,970 Other 38 172 Totals $ 17,426 $ 14,639 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Fair Value Options Weighted-Average Assumptions | The fair value of options granted to employees was estimated using the Black-Scholes Option Pricing Method (see Note 2) with the following weighted-average assumptions used during the years ended December 31: 2016 2015 2014 Dividend yield 0.0 % 0.0 % 0.0 % Expected volatility 68.1 % 64.5 % 74.4 % Risk-free interest rate 1.7 % 1.6 % 1.8 % Expected life in years 5.80 5.82 5.85 |
Employee Stock-based Compensation | Employee stock-based compensation was as follows for the years ended December 31 (in thousands except per share data): 2016 2015 2014 Stock-based compensation: Options- Research and development, or R&D $ 88,049 $ 76,995 $ 28,446 General and administrative, or G&A 25,043 17,166 9,154 Restricted stock units- G&A 1,580 — — R&D 3,120 — — Performance shares: R&D (528 ) 773 1,551 Total share-based compensation expense $ 117,264 $ 94,934 $ 39,151 Impact on basic and diluted net loss per share $ 3.52 $ 2.96 $ 1.30 Weighted average shares (basic and diluted) 33,295,114 32,126,094 30,010,979 |
Activity with Respect to Options Granted | Activity with respect to options granted under the 2011 Plan is summarized as follows: Shares Weighted Average Exercise Price Weighted Contractual Term (years) Aggregate Intrinsic Value (in thousands) Outstanding at December 31, 2013 2,604,224 $ 23.31 8.9 $ 208,902 Granted 1,980,208 $ 159.62 9.2 — Forfeited (175,816 ) $ 67.08 — — Exercised (430,490 ) $ 17.12 — $ 74,109 Outstanding at December 31, 2014 3,978,126 $ 89.55 8.7 $ 431,635 Granted 2,606,183 $ 117.62 9.4 — Forfeited (277,140 ) $ 177.98 — — Exercised (757,038 ) $ 36.19 — $ 102,149 Expired (7,846 ) $ 105.42 Outstanding at December 31, 2015 5,542,285 $ 105.59 8.6 $ 87,632 Granted 1,658,465 $ 42.34 9.3 Forfeited (446,544 ) $ 122.50 Exercised (43,751 ) $ 13.16 $ 1,360 Expired (131,933 ) $ 185.10 Outstanding at December 31, 2016 6,578,522 $ 87.52 8.0 $ 18,442 Unvested at December 31, 2016 3,106,083 $ 80.00 9.1 $ 171 Exercisable at December 31, 2016 3,472,439 $ 94.24 7.0 $ 18,271 |
Stock Options and Performance Shares | The weighted-average grant date fair value of options granted during the years ended December 31, 2016, 2015 and 2014, was $25.69, $68.30 and $101.17 per share, respectively. The weighted average grant date fair value of restricted stock units awarded during the year ended December 31, 2016, was $54.35. Weighted Average Grant-Date Stock options Shares Fair Value Nonvested shares at December 31, 2015 3,572,202 $ 73.59 Granted 1,658,465 25.69 Vested/Issued (1,678,040 ) 77.69 Forfeited (446,544 ) 73.22 Nonvested shares at December 31, 2016 3,106,083 $ 47.78 Weighted Average Grant-Date Performance shares Shares Fair Value Nonvested shares at December 31, 2015 9,469 $ 102.46 Granted — 102.46 Vested/Issued — 102.46 Cancelled (9,469 ) 102.46 Nonvested shares at December 31, 2016 — $ 102.46 |
Restricted Stock Units | Weighted Average Grant-Date Restricted stock units Shares Fair Value Nonvested shares at December 31, 2015 — $ — Granted 640,644 54.35 Vested/Issued (2,917 ) 54.35 Cancelled (7,219 ) 54.35 Nonvested shares at December 31, 2016 630,508 $ 54.35 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Components of Net Deferred Tax Assets | The components of the Company’s net deferred tax assets as of December 31, 2016 and 2015 are as follows (in thousands): Federal State Total Deferred tax assets—2016: Net operating loss carry forwards $ 178,654 $ 30,654 $ 209,308 Business credit carryforwards 14,257 6,999 21,256 Organization costs 151 26 177 Compensation 71,987 12,354 84,341 Deferred rent - leasehold improvement 1,019 175 1,194 Other 852 145 997 266,920 50,353 317,273 Deferred tax liabilities (1,083 ) (186 ) (1,269 ) Total deferred tax assets 265,837 50,167 316,004 Valuation allowance (265,837 ) (50,167 ) (316,004 ) Net deferred tax assets $ — $ — $ — Federal State Total Deferred tax assets—2015: Net operating loss carry forwards $ 125,244 $ 21,489 $ 146,733 Business credit carryforwards 11,528 6,373 17,901 Organization costs 166 29 195 Compensation 38,138 6,545 44,683 Depreciation 180 30 210 Other 53 9 62 175,309 34,475 209,784 Deferred tax liabilities — — — Total deferred tax assets 175,309 34,475 209,784 Valuation allowance (175,309 ) (34,475 ) (209,784 ) Net deferred tax assets $ — $ — $ — |
Schedule of Income Tax Reconciliation | The provision (credit) for income taxes in the accompanying Consolidated Statements of Operations differs from the amount calculated by applying the statutory income tax rate to income (loss) from continuing operations before income taxes. The primary components of such differences are as follows as of December 31 (in thousands): 2016 2015 2014 Tax computed at the federal statutory rate $ (93,839 ) $ (81,356 ) $ (48,268 ) State taxes (15,693 ) (16,620 ) (8,465 ) Permanent items 6,152 4,225 9,956 R&D credits (2,728 ) (5,029 ) (3,697 ) Other (113 ) (2,571 ) 690 Change in valuation allowance 106,221 101,351 49,784 Total provision $ — $ — $ — |
Reconciliation of Unrecognized Tax Benefits | The following is a tabular reconciliation of the total amounts of unrecognized tax benefits at December 31: (in thousands) 2016 2015 2014 Unrecognized tax benefits—January 1 $ 4,475 $ 2,482 $ 1,263 Gross decreases—tax positions in prior period — — (205 ) Gross increases—tax positions in current period 840 1,993 1,424 Unrecognized tax benefits—December 31 $ 5,315 $ 4,475 $ 2,482 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments And Contingencies Disclosure [Abstract] | |
Future Minimum Lease Payments | Future minimum lease payments for each of the years subsequent to December 31, 2016, are as follows (in thousands): Year Ending December 31, Amount 2017 $ 3,977 2018 4,096 2019 4,219 2020 4,345 Thereafter 24,733 Total $ 41,370 |
Summary of Clinical Research Organization Contracts | The contracts also contain variable costs that are hard to predict as they are based on such things as patients enrolled and clinical trial sites, which can vary and therefore, are not included in the table below. The contracts held by the Company as of December 31, 2016, are summarized as follows (in thousands): Indication Estimated Contractual Obligations as of December 31, 2016 Months Remaining on Contract HER2 Overexpressed/Amplified Breast Cancer (Extension) $ 22,844 20 HER2 Overexpressed/Amplified Breast Cancer (Licensor Legacy Clinical Trials) 1,541 12 HER2 Mutated Non-Small Cell Lung Cancer 338 12 HER2 Mutated Breast Cancer and HER2 Mutated Breast Cancer with Brain Mets 3,962 18 Metastatic & Adjuvant Breast Cancer 47,865 21 Neoadjuvant Breast Cancer 4,537 20 Preclinical Research 22,557 13 HER2 Mutated Solid Tumors 12,946 12 Other 6,487 12 Total $ 123,077 |
Quarterly Financial Data (Table
Quarterly Financial Data (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Data | Quarterly financial data (in thousands except share and per share data): (unaudited) Three Months Ended March 31, June 30, September 30, December 31, 2016 Revenues $ — $ — $ — $ — Net loss (70,972 ) (66,597 ) (65,781 ) (72,661 ) Net loss applicable to common stock (70,972 ) (66,597 ) (65,781 ) (72,661 ) Net loss per share—basic and diluted $ (2.19 ) $ (2.05 ) $ (2.02 ) $ (2.04 ) Weighted-average common shares outstanding—basic and diluted 32,478,408 32,493,092 32,497,168 35,694,193 2015 Revenues $ — $ — $ — $ — Net loss (52,454 ) (64,694 ) (60,417 ) (61,719 ) Net loss applicable to common stock (52,454 ) (64,694 ) (60,417 ) (61,719 ) Net loss per share—basic and diluted $ (1.66 ) $ (2.01 ) $ (1.87 ) $ (1.90 ) Weighted-average common shares outstanding—basic and diluted 31,588,315 32,158,108 32,303,203 32,444,270 2014 Revenues $ — $ — $ — $ — Net loss (19,794 ) (38,844 ) (35,844 ) (47,483 ) Net loss applicable to common stock (19,794 ) (38,844 ) (35,844 ) (47,483 ) Net loss per share—basic and diluted $ (0.67 ) $ (1.29 ) $ (1.19 ) $ (1.57 ) Weighted-average common shares outstanding—basic and diluted 29,567,071 30,117,819 30,117,819 30,232,718 |
Business and Basis of Present28
Business and Basis of Presentation - Additional Information (Detail) - USD ($) $ in Thousands | Oct. 20, 2016 | Jan. 27, 2015 | Feb. 14, 2014 | Oct. 24, 2012 | Oct. 31, 2016 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | ||||||||||||||||||||
Net loss | $ (72,661) | $ (65,781) | $ (66,597) | $ (70,972) | $ (61,719) | $ (60,417) | $ (64,694) | $ (52,454) | $ (47,483) | $ (35,844) | $ (38,844) | $ (19,794) | $ (276,011) | $ (239,284) | $ (141,965) | |||||
Net cash used in operating activities | (141,690) | (154,468) | (77,203) | |||||||||||||||||
Cash and cash equivalents and marketable securities | $ 229,400 | 229,400 | ||||||||||||||||||
Net proceeds from issuance of common stock | $ 161,854 | $ 205,133 | $ 129,440 | |||||||||||||||||
Underwritten Public Offering | ||||||||||||||||||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | ||||||||||||||||||||
Net proceeds from issuance of common stock | $ 161,900 | $ 205,100 | $ 129,400 | $ 129,200 | $ 161,900 |
Assets Measured at Fair Value o
Assets Measured at Fair Value on Recurring Basis (Detail) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash equivalents | $ 188,543 | $ 29,166 |
Total | 223,525 | 213,486 |
Corporate bonds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Marketable securities | 28,984 | 169,824 |
Commercial paper | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Marketable securities | 5,998 | 2,996 |
U.S. government | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Marketable securities | 11,500 | |
Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash equivalents | 188,543 | 29,166 |
Total | 188,543 | 29,166 |
Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total | 34,982 | 184,320 |
Level 2 | Corporate bonds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Marketable securities | 28,984 | 169,824 |
Level 2 | Commercial paper | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Marketable securities | $ 5,998 | 2,996 |
Level 2 | U.S. government | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Marketable securities | $ 11,500 |
Significant Accounting Polici30
Significant Accounting Policies - Additional Information (Detail) - USD ($) | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Significant Accounting Policies [Line Items] | ||||
Cash and cash equivalents in excess of insured limits | $ 199,000,000 | |||
Impairment losses recognized | $ 0 | |||
Costs of excess cap billed to the licensor | $ 16,400,000 | |||
License Agreement, number of days to review the invoice and supporting documentation | 60 days | |||
License Agreement expenses | $ 0 | $ 0 | $ 0 | |
Accrued interest or penalties related to uncertain tax positions | $ 0 | $ 0 | ||
Anti-dilutive securities excluded from the calculation of diluted earnings per share | 7,668,007 | 6,113,318 | ||
Restricted Stock Units | ||||
Significant Accounting Policies [Line Items] | ||||
Anti-dilutive securities excluded from the calculation of diluted earnings per share | 630,508 | |||
Warrants | ||||
Significant Accounting Policies [Line Items] | ||||
Anti-dilutive securities excluded from the calculation of diluted earnings per share | 2,116,250 | |||
Performance Awards | ||||
Significant Accounting Policies [Line Items] | ||||
Shares, vesting period | 3 years | |||
Employee Stock Option | ||||
Significant Accounting Policies [Line Items] | ||||
Anti-dilutive securities excluded from the calculation of diluted earnings per share | 6,578,623 | |||
Minimum | ||||
Significant Accounting Policies [Line Items] | ||||
Property and equipment, useful lives | 3 years | |||
Maximum | ||||
Significant Accounting Policies [Line Items] | ||||
Property and equipment, useful lives | 5 years |
Components of Prepaid Expenses
Components of Prepaid Expenses and Other (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Prepaid Expenses [Line Items] | ||
Prepaid expenses and other, current | $ 6,998 | $ 7,660 |
Prepaid expenses and other, long-term | 6,846 | 9,597 |
Totals | 13,844 | 17,257 |
CRO services | ||
Prepaid Expenses [Line Items] | ||
Prepaid expenses and other, current | 3,471 | 2,969 |
Prepaid expenses and other, long-term | 5,077 | 5,754 |
Other clinical development | ||
Prepaid Expenses [Line Items] | ||
Prepaid expenses and other, current | 1,069 | 2,309 |
Prepaid expenses and other, long-term | 1,243 | 3,005 |
Insurance | ||
Prepaid Expenses [Line Items] | ||
Prepaid expenses and other, current | 1,159 | 1,138 |
Prepaid expenses and other, long-term | 40 | 87 |
Other | ||
Prepaid Expenses [Line Items] | ||
Prepaid expenses and other, current | 1,299 | 1,244 |
Prepaid expenses and other, long-term | $ 486 | $ 751 |
Property and Equipment (Detail)
Property and Equipment (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Property Plant And Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 8,102 | $ 4,484 |
Less: accumulated depreciation and amortization | (2,949) | (2,101) |
Totals | 5,153 | 2,383 |
Leasehold Improvements | ||
Property Plant And Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 3,878 | 1,502 |
Computer Equipment | ||
Property Plant And Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 1,822 | 1,646 |
Telephone Equipment | ||
Property Plant And Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 256 | 169 |
Furniture and Fixtures | ||
Property Plant And Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 2,146 | $ 1,167 |
Accrued Expenses (Detail)
Accrued Expenses (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Payables And Accruals [Abstract] | ||
Accrued CRO/licensor services | $ 6,609 | $ 8,436 |
Accrued other clinical development | 7,015 | 3,618 |
Accrued legal fees | 706 | 443 |
Accrued compensation | 3,058 | 1,970 |
Other | 38 | 172 |
Totals | $ 17,426 | $ 14,639 |
Stockholders Equity - Additiona
Stockholders Equity - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | Dec. 15, 2016 | Oct. 20, 2016 | Oct. 19, 2016 | Dec. 15, 2015 | Jan. 27, 2015 | Jan. 21, 2015 | Dec. 15, 2014 | Feb. 14, 2014 | Feb. 12, 2014 | Feb. 10, 2014 | Oct. 24, 2012 | Oct. 19, 2012 | Oct. 18, 2012 | Oct. 31, 2016 | Jan. 31, 2014 | Oct. 31, 2011 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Oct. 04, 2011 |
Stockholders Equity Note [Line Items] | |||||||||||||||||||||
Common stock, par value | $ 0.0001 | $ 0.0001 | |||||||||||||||||||
Issuance of common stock, per share | $ 40 | $ 190 | $ 122.50 | ||||||||||||||||||
Net proceeds from issuance of common stock | $ 161,854 | $ 205,133 | $ 129,440 | ||||||||||||||||||
Underwriters option exercisable period | 30 days | ||||||||||||||||||||
Issuance of common stock on exercise of option | 43,751 | 757,038 | 430,490 | ||||||||||||||||||
Common stock, shares authorized | 100,000,000 | 100,000,000 | |||||||||||||||||||
Shares of stock authorized before amendment | 110,000,000 | ||||||||||||||||||||
Preferred stock, shares authorized | 10,000,000 | ||||||||||||||||||||
Preferred stock, par value | $ 0.0001 | ||||||||||||||||||||
Equity method investment ownership percentage | 100.00% | ||||||||||||||||||||
Common stock, shares outstanding | 36,826,010 | 32,466,842 | |||||||||||||||||||
Warrant expiration date | Oct. 4, 2021 | ||||||||||||||||||||
Issuance of common stock on exercise of option | 6,578,522 | 5,542,285 | 3,978,126 | 2,604,224 | |||||||||||||||||
Weighted-average grant date fair value of options granted | $ 25.69 | $ 68.30 | $ 101.17 | ||||||||||||||||||
2011 Plan | |||||||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||||||
Common stock shares reserved for issuance | 10,529,412 | ||||||||||||||||||||
Issuance of common stock on exercise of option | 7,209,131 | ||||||||||||||||||||
Common stock are available for future issuance | 1,741,857 | ||||||||||||||||||||
Performance Awards | |||||||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||||||
Number of shares granted to employees | 0 | ||||||||||||||||||||
Shares vesting period | 3 years | ||||||||||||||||||||
Shares issued to the employees | 0 | 11,495 | 11,495 | ||||||||||||||||||
Shares cancelled | 9,469 | 7,447 | 7,447 | 9,469 | |||||||||||||||||
Weighted-average grant date fair value of restricted stock units | $ 102.46 | ||||||||||||||||||||
Performance Awards | Employees | |||||||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||||||
Common stock price | $ 102.46 | ||||||||||||||||||||
Shares vesting period | 3 years | ||||||||||||||||||||
Non Vested Stock Options | |||||||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||||||
Estimated unrecognized employee compensation cost related to non-vested stock options granted | $ 132,100 | ||||||||||||||||||||
Estimated unrecognized employee compensation cost related to non-vested stock options granted, Weighted-average period of recognition | 1 year 8 months 12 days | ||||||||||||||||||||
Restricted Stock Units | |||||||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||||||
Number of shares granted to employees | 640,644 | ||||||||||||||||||||
Shares cancelled | 7,219 | ||||||||||||||||||||
Estimated unrecognized employee compensation cost related to non-vested stock options granted | $ 29,700 | ||||||||||||||||||||
Estimated unrecognized employee compensation cost related to non-vested stock options granted, Weighted-average period of recognition | 2 years 7 months 6 days | ||||||||||||||||||||
Weighted-average grant date fair value of restricted stock units | $ 54.35 | ||||||||||||||||||||
President | |||||||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||||||
Percentage of shares held by related party | 21.00% | ||||||||||||||||||||
Common Stock | |||||||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||||||
Issuance of common stock (in shares) | 4,312,500 | 1,150,000 | 1,126,530 | ||||||||||||||||||
Issuance of common stock on exercise of option | 46,668 | 757,038 | 430,490 | ||||||||||||||||||
Common stock, shares outstanding | 36,826,010 | 32,466,842 | 30,548,309 | 28,991,289 | |||||||||||||||||
Shares of common stock that could be acquired by warrant | 2,116,250 | ||||||||||||||||||||
Common stock price | $ 16 | ||||||||||||||||||||
Common Stock | President | |||||||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||||||
Common stock, shares outstanding | 18,666,733 | ||||||||||||||||||||
Maximum | 2011 Plan | |||||||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||||||
Stock options granted, term | 10 years | ||||||||||||||||||||
Maximum | Performance Awards | |||||||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||||||
Number of shares granted to employees | 28,411 | ||||||||||||||||||||
Maximum | Performance Awards | Employees | |||||||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||||||
Number of shares granted to employees | 28,411 | ||||||||||||||||||||
Minimum | Performance Awards | Employees | |||||||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||||||
Common stock price | $ 47.53 | ||||||||||||||||||||
Minimum | Common Stock | President | |||||||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||||||
Minimum ownership percentage of outstanding shares of common stock the president need to maintain after issuance of warrants | 20.00% | ||||||||||||||||||||
Underwritten Public Offering | |||||||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||||||
Issuance of common stock (in shares) | 3,750,000 | 1,000,000 | 979,592 | 7,500,000 | |||||||||||||||||
Common stock, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||||||||||||||||
Issuance of common stock, per share | $ 40 | $ 190 | $ 122.50 | $ 16 | |||||||||||||||||
Net proceeds from issuance of common stock | $ 161,900 | $ 205,100 | $ 129,400 | $ 129,200 | $ 161,900 | ||||||||||||||||
Gross proceeds from issuance of common stock | 218,500 | 138,000 | 138,000 | ||||||||||||||||||
Public offering, underwriting discount and estimated offering expenses | $ 13,400 | $ 8,600 | $ 8,800 | ||||||||||||||||||
Overallotment Option Exercise by Underwriters | |||||||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||||||
Issuance of common stock (in shares) | 150,000 | 146,938 | 1,125,000 | ||||||||||||||||||
Overallotment Option Exercise by Underwriters | Maximum | |||||||||||||||||||||
Stockholders Equity Note [Line Items] | |||||||||||||||||||||
Issuance of common stock (in shares) | 562,500 |
Fair Value Options Weighted-Ave
Fair Value Options Weighted-Average Assumptions (Detail) - Employee Stock Option | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Dividend yield | 0.00% | 0.00% | 0.00% |
Expected volatility | 68.10% | 64.50% | 74.40% |
Risk-free interest rate | 1.70% | 1.60% | 1.80% |
Expected life in years | 5 years 9 months 18 days | 5 years 9 months 26 days | 5 years 10 months 6 days |
Employee Stock-based Compensati
Employee Stock-based Compensation (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||||||||
Total share-based compensation expense | $ 117,264 | $ 94,934 | $ 39,151 | ||||||||||||
Impact on basic and diluted net loss per share | $ 3.52 | $ 2.96 | $ 1.30 | ||||||||||||
Weighted average shares (basic and diluted) | 35,694,193 | 32,497,168 | 32,493,092 | 32,478,408 | 32,444,270 | 32,303,203 | 32,158,108 | 31,588,315 | 30,232,718 | 30,117,819 | 30,117,819 | 29,567,071 | 33,295,114 | 32,126,094 | 30,010,979 |
Employee Stock Option | Research and development | |||||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||||||||
Total share-based compensation expense | $ 88,049 | $ 76,995 | $ 28,446 | ||||||||||||
Employee Stock Option | General and administrative | |||||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||||||||
Total share-based compensation expense | 25,043 | 17,166 | 9,154 | ||||||||||||
Restricted Stock Units | Research and development | |||||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||||||||
Total share-based compensation expense | 3,120 | ||||||||||||||
Restricted Stock Units | General and administrative | |||||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||||||||
Total share-based compensation expense | 1,580 | ||||||||||||||
Performance Awards | |||||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||||||||
Total share-based compensation expense | $ (528) | $ 773 | $ 1,551 |
Activity with Respect to Option
Activity with Respect to Options Granted (Detail) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Shares | ||||
Beginning balance, shares | 5,542,285 | 3,978,126 | 2,604,224 | |
Granted, shares | 1,658,465 | 2,606,183 | 1,980,208 | |
Forfeited, shares | (446,544) | (277,140) | (175,816) | |
Exercised, shares | (43,751) | (757,038) | (430,490) | |
Expired, shares | (131,933) | (7,846) | ||
Ending balance, shares | 6,578,522 | 5,542,285 | 3,978,126 | 2,604,224 |
Unvested, shares | 3,106,083 | 3,572,202 | ||
Exercisable, shares | 3,472,439 | |||
Weighted Average Exercise Price | ||||
Beginning Balance, Weighted Average Exercise Price | $ 105.59 | $ 89.55 | $ 23.31 | |
Granted, Weighted Average Exercise Price | 42.34 | 117.62 | 159.62 | |
Forfeited, Weighted Average Exercise Price | 122.50 | 177.98 | 67.08 | |
Exercised, Weighted Average Exercise Price | 13.16 | 36.19 | 17.12 | |
Expired, Weighted Average Exercise Price | 185.10 | 105.42 | ||
Ending Balance, Weighted Average Exercise Price | 87.52 | $ 105.59 | $ 89.55 | $ 23.31 |
Unvested, Weighted Average Exercise Price | 80 | |||
Exercisable, Weighted Average Exercise Price | $ 94.24 | |||
Weighted Average Remaining Contractual Term (years) | ||||
Weighted Average Remaining Contractual Term (years) | 8 years | 8 years 7 months 6 days | 8 years 8 months 12 days | 8 years 10 months 24 days |
Granted, Weighted Average Remaining Contractual Term (years) | 9 years 3 months 18 days | 9 years 4 months 24 days | 9 years 2 months 12 days | |
Unvested, Weighted Average Remaining Contractual Term (years) | 9 years 1 month 6 days | |||
Exercisable, Weighted Average Remaining Contractual Term (years) | 7 years | |||
Aggregate Intrinsic Value | ||||
Beginning balance, Aggregate Intrinsic Value | $ 87,632 | $ 431,635 | $ 208,902 | |
Exercised, Aggregate Intrinsic Value | 1,360 | 102,149 | 74,109 | |
Ending balance, Aggregate Intrinsic Value | 18,442 | $ 87,632 | $ 431,635 | $ 208,902 |
Unvested, Aggregate Intrinsic Value | 171 | |||
Exercisable, Aggregate Intrinsic Value | $ 18,271 |
Stock Options (Detail)
Stock Options (Detail) - $ / shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Shares | |||
Beginning balance, shares | 3,572,202 | ||
Granted, shares | 1,658,465 | 2,606,183 | 1,980,208 |
Vested/Issued, shares | (1,678,040) | ||
Forfeited, shares | (446,544) | ||
Ending balance, shares | 3,106,083 | 3,572,202 | |
Weighted Average Grant-Date Fair Value | |||
Beginning balance, Weighted Average Grant-Date Fair Value | $ 73.59 | ||
Granted, Weighted Average Grant-Date Fair Value | 25.69 | $ 68.30 | $ 101.17 |
Vested/Issued, Weighted Average Grant-Date Fair Value | 77.69 | ||
Forfeited, Weighted Average Grant-Date Fair Value | 73.22 | ||
Ending balance, Weighted Average Grant-Date Fair Value | $ 47.78 | $ 73.59 |
Performance Shares (Detail)
Performance Shares (Detail) - Performance Awards - $ / shares | Dec. 15, 2016 | Dec. 15, 2015 | Dec. 15, 2014 | Dec. 31, 2016 |
Performance shares | ||||
Beginning balance, shares | 9,469 | |||
Granted, shares | 0 | |||
Vested/Issued, shares | 0 | |||
Cancelled, shares | (9,469) | (7,447) | (7,447) | (9,469) |
Ending balance, shares | 0 | |||
Weighted Average Grant-Date Fair Value | ||||
Beginning balance, Weighted Average Grant-Date Fair Value | $ 102.46 | |||
Granted, Weighted Average Grant-Date Fair Value | 102.46 | |||
Vested/Issued, Weighted Average Grant-Date Fair Value | 102.46 | |||
Cancelled, Weighted Average Grant-Date Fair Value | 102.46 | |||
Ending balance, Weighted Average Grant-Date Fair Value | $ 102.46 |
Restricted Stock Units (Detail)
Restricted Stock Units (Detail) - Restricted Stock Units | 12 Months Ended |
Dec. 31, 2016$ / sharesshares | |
Shares | |
Beginning balance, shares | shares | 0 |
Granted, shares | shares | 640,644 |
Vested/Issued, shares | shares | (2,917) |
Cancelled, shares | shares | (7,219) |
Ending balance, shares | shares | 630,508 |
Weighted Average Grant-Date Fair Value | |
Beginning balance, Weighted Average Grant-Date Fair Value | $ / shares | $ 0 |
Granted, Weighted Average Grant-Date Fair Value | $ / shares | 54.35 |
Vested/Issued, Weighted Average Grant-Date Fair Value | $ / shares | 54.35 |
Cancelled, Weighted Average Grant-Date Fair Value | $ / shares | 54.35 |
Ending balance, Weighted Average Grant-Date Fair Value | $ / shares | $ 54.35 |
401(K) Savings Plan - Additiona
401(K) Savings Plan - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Employer matching contribution expenses | $ 1 | $ 0.7 | $ 0.5 |
First 3% of each Participant's Contributions | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Company's matching contributions to the 401(k)plan | 100.00% | ||
Second 2% of each Participant's Contributions | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Company's matching contributions to the 401(k)plan | 50.00% |
Components of Net Deferred Tax
Components of Net Deferred Tax Assets (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred tax assets | ||
Net operating loss carry forwards | $ 209,308 | $ 146,733 |
Business credit carryforwards | 21,256 | 17,901 |
Organization costs | 177 | 195 |
Compensation | 84,341 | 44,683 |
Deferred rent - leasehold improvement | 1,194 | |
Depreciation | 210 | |
Other | 997 | 62 |
Deferred Tax Assets, Gross, Total | 317,273 | 209,784 |
Deferred tax liabilities | (1,269) | |
Total deferred tax assets | 316,004 | 209,784 |
Valuation allowance | (316,004) | (209,784) |
Net deferred tax assets | 0 | 0 |
Federal | ||
Deferred tax assets | ||
Net operating loss carry forwards | 178,654 | 125,244 |
Business credit carryforwards | 14,257 | 11,528 |
Organization costs | 151 | 166 |
Compensation | 71,987 | 38,138 |
Deferred rent - leasehold improvement | 1,019 | |
Depreciation | 180 | |
Other | 852 | 53 |
Deferred Tax Assets, Gross, Total | 266,920 | 175,309 |
Deferred tax liabilities | (1,083) | |
Total deferred tax assets | 265,837 | 175,309 |
Valuation allowance | (265,837) | (175,309) |
Net deferred tax assets | 0 | 0 |
State | ||
Deferred tax assets | ||
Net operating loss carry forwards | 30,654 | 21,489 |
Business credit carryforwards | 6,999 | 6,373 |
Organization costs | 26 | 29 |
Compensation | 12,354 | 6,545 |
Deferred rent - leasehold improvement | 175 | |
Depreciation | 30 | |
Other | 145 | 9 |
Deferred Tax Assets, Gross, Total | 50,353 | 34,475 |
Deferred tax liabilities | (186) | |
Total deferred tax assets | 50,167 | 34,475 |
Valuation allowance | (50,167) | (34,475) |
Net deferred tax assets | $ 0 | $ 0 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Contingency [Line Items] | ||
Increase in valuation allowance | $ 106,200,000 | $ 101,400,000 |
Federal operating loss carryforwards, expiration beginning year | 2,031 | |
State operating loss carryforwards, expiration beginning year | 2,031 | |
Increase in equity with deferred tax assets realization | $ 100,000 | |
Unrecognized tax benefits that would affect the effective tax rate, if recognized | $ 0 | |
Federal | ||
Income Tax Contingency [Line Items] | ||
Operating loss carryforwards | 525,500,000 | |
Federal | Research and development credit carryforwards | ||
Income Tax Contingency [Line Items] | ||
Tax credit carryforwards | 14,300,000 | |
State | ||
Income Tax Contingency [Line Items] | ||
Operating loss carryforwards | 525,500,000 | |
State | Research and development credit carryforwards | ||
Income Tax Contingency [Line Items] | ||
Tax credit carryforwards | $ 10,600,000 |
Schedule of Income Tax Reconcil
Schedule of Income Tax Reconciliation (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
Tax computed at the federal statutory rate | $ (93,839) | $ (81,356) | $ (48,268) |
State taxes | (15,693) | (16,620) | (8,465) |
Permanent items | 6,152 | 4,225 | 9,956 |
R&D credits | (2,728) | (5,029) | (3,697) |
Other | (113) | (2,571) | 690 |
Change in valuation allowance | 106,221 | 101,351 | 49,784 |
Total provision | $ 0 | $ 0 | $ 0 |
Reconciliation of Unrecognized
Reconciliation of Unrecognized Tax Benefits (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
Unrecognized tax benefits—January 1 | $ 4,475 | $ 2,482 | $ 1,263 |
Gross decreases—tax positions in prior period | (205) | ||
Gross increases—tax positions in current period | 840 | 1,993 | 1,424 |
Unrecognized tax benefits—December 31 | $ 5,315 | $ 4,475 | $ 2,482 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) | Apr. 14, 2016DerivativeLawsuit | Apr. 02, 2016USD ($) | Jun. 07, 2012USD ($) | Dec. 07, 2011USD ($) | Dec. 31, 2016USD ($)LegalProceeding | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Jul. 31, 2015ft² | May 19, 2014USD ($)ft² | Mar. 18, 2014USD ($)ft² | Dec. 01, 2013USD ($)ft² | Nov. 28, 2012USD ($)ft² |
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||
Existing square feet of leased property | ft² | 9,560 | 22,775 | 16,750 | 13,250 | ||||||||
License agreement, expected milestone payment | $ 187,500,000 | |||||||||||
Company obligations for potential milestone payments for CRO Contracts | $ 22,700,000 | |||||||||||
Number legal proceedings | LegalProceeding | 4 | |||||||||||
Number of shareholders derivative lawsuits | DerivativeLawsuit | 2 | |||||||||||
Los Angeles | ||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||
Office lease, lease term | 10 years | |||||||||||
Additional lease rent per month | $ 150,000 | |||||||||||
Lease expiration date | Mar. 31, 2026 | |||||||||||
Additional square feet leased | ft² | 26,000 | |||||||||||
Lease commencement date | Apr. 1, 2016 | |||||||||||
Percentage of increase in annual rent | 3.00% | |||||||||||
South San Francisco | ||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||
Office lease, lease term | 10 years | |||||||||||
Additional lease rent per month | $ 51,400 | |||||||||||
Lease expiration date | Mar. 31, 2026 | |||||||||||
Additional square feet leased | ft² | 13,000 | |||||||||||
Lease commencement date | Apr. 1, 2016 | |||||||||||
Percentage of increase in annual rent | 3.00% | |||||||||||
Additional Office Space Lease | ||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||
Additional lease rent per month | $ 22,886 | $ 11,487 | $ 10,400 | $ 12,145 | ||||||||
Additional square feet leased | ft² | 7,152 | 2,908 | 5,949 | 3,500 | ||||||||
Minimum | CRO services | ||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||
Written notice of termination, period | 30 days | |||||||||||
Maximum | CRO services | ||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||
Written notice of termination, period | 45 days | |||||||||||
Maximum | Additional Office Space Lease | ||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||
Additional lease rent per month | $ 27,328 | $ 12,928 | $ 25,100 | $ 14,080 | ||||||||
Lease Agreement executed on December 7, 2011 | ||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||
Office lease, lease term | 7 years | |||||||||||
Lease expiration date | Dec. 9, 2018 | |||||||||||
Office space, lease extension term | 5 years | |||||||||||
Office space, lease extension Stand-by letter of credit | $ 2,500,000 | |||||||||||
Rent expense | $ 3,547,300 | $ 1,597,200 | $ 1,126,700 | |||||||||
Lease Agreement executed on December 7, 2011 | Minimum | ||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||
Additional lease rent per month | 44,400 | |||||||||||
Lease Agreement executed on December 7, 2011 | Maximum | ||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||
Additional lease rent per month | $ 53,000 | |||||||||||
Lease Agreement executed on June 7, 2012 | ||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||
Office lease, lease term | 7 years | |||||||||||
Office space, lease extension term | 5 years | |||||||||||
Office space, lease extension Stand-by letter of credit | $ 1,591,400 | |||||||||||
Lease Agreement executed on June 7, 2012 | Minimum | ||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||
Additional lease rent per month | 20,250 | |||||||||||
Lease Agreement executed on June 7, 2012 | Maximum | ||||||||||||
Commitments And Contingencies Disclosure [Line Items] | ||||||||||||
Additional lease rent per month | $ 30,820 |
Future Minimum Lease Payments (
Future Minimum Lease Payments (Detail) $ in Thousands | Dec. 31, 2016USD ($) |
Leases [Abstract] | |
2,017 | $ 3,977 |
2,018 | 4,096 |
2,019 | 4,219 |
2,020 | 4,345 |
Thereafter | 24,733 |
Total | $ 41,370 |
Summary of Clinical Research Or
Summary of Clinical Research Organization Contracts (Detail) $ in Thousands | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Research And Development Arrangement Contract To Perform For Others [Line Items] | |
Estimated Contractual Obligations | $ 123,077 |
HER2 Overexpressed/Amplified Breast Cancer (Extension) | |
Research And Development Arrangement Contract To Perform For Others [Line Items] | |
Estimated Contractual Obligations | $ 22,844 |
Months remaining on contract | 20 months |
HER2 Overexpressed/Amplified Breast Cancer (Licensor Legacy Clinical Trials) | |
Research And Development Arrangement Contract To Perform For Others [Line Items] | |
Estimated Contractual Obligations | $ 1,541 |
Months remaining on contract | 12 months |
HER2 Mutated Non-Small Cell Lung Cancer | |
Research And Development Arrangement Contract To Perform For Others [Line Items] | |
Estimated Contractual Obligations | $ 338 |
Months remaining on contract | 12 months |
HER2 Mutated Breast Cancer and HER2 Mutated Breast Cancer with Brain Mets | |
Research And Development Arrangement Contract To Perform For Others [Line Items] | |
Estimated Contractual Obligations | $ 3,962 |
Months remaining on contract | 18 months |
Metastatic & Adjuvant Breast Cancer | |
Research And Development Arrangement Contract To Perform For Others [Line Items] | |
Estimated Contractual Obligations | $ 47,865 |
Months remaining on contract | 21 months |
Neoadjuvant Breast Cancer | |
Research And Development Arrangement Contract To Perform For Others [Line Items] | |
Estimated Contractual Obligations | $ 4,537 |
Months remaining on contract | 20 months |
Preclinical Research | |
Research And Development Arrangement Contract To Perform For Others [Line Items] | |
Estimated Contractual Obligations | $ 22,557 |
Months remaining on contract | 13 months |
HER2 Mutated Solid Tumors | |
Research And Development Arrangement Contract To Perform For Others [Line Items] | |
Estimated Contractual Obligations | $ 12,946 |
Months remaining on contract | 12 months |
Other | |
Research And Development Arrangement Contract To Perform For Others [Line Items] | |
Estimated Contractual Obligations | $ 6,487 |
Months remaining on contract | 12 months |
Quarterly Financial Data (Detai
Quarterly Financial Data (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||
Net loss | $ (72,661) | $ (65,781) | $ (66,597) | $ (70,972) | $ (61,719) | $ (60,417) | $ (64,694) | $ (52,454) | $ (47,483) | $ (35,844) | $ (38,844) | $ (19,794) | $ (276,011) | $ (239,284) | $ (141,965) |
Net loss applicable to common stock | $ (72,661) | $ (65,781) | $ (66,597) | $ (70,972) | $ (61,719) | $ (60,417) | $ (64,694) | $ (52,454) | $ (47,483) | $ (35,844) | $ (38,844) | $ (19,794) | $ (276,011) | $ (239,284) | $ (141,965) |
Net loss per share—basic and diluted | $ (2.04) | $ (2.02) | $ (2.05) | $ (2.19) | $ (1.90) | $ (1.87) | $ (2.01) | $ (1.66) | $ (1.57) | $ (1.19) | $ (1.29) | $ (0.67) | $ (8.29) | $ (7.45) | $ (4.73) |
Weighted-average common shares outstanding—basic and diluted | 35,694,193 | 32,497,168 | 32,493,092 | 32,478,408 | 32,444,270 | 32,303,203 | 32,158,108 | 31,588,315 | 30,232,718 | 30,117,819 | 30,117,819 | 29,567,071 | 33,295,114 | 32,126,094 | 30,010,979 |