Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2014 |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation |
The Company’s consolidated financial statements include the Company’s accounts and the accounts of the Company’s wholly owned subsidiary, Agios Securities Corporation. All intercompany transactions have been eliminated in consolidation. The consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”). |
Use of Estimates | Use of Estimates |
The preparation of financial statements in conformity with U.S. GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from those estimates. |
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Prior to the IPO, the Company utilized significant estimates and assumptions in determining the fair value of its common stock. The board of directors determined the estimated fair value of the Company’s common stock based on a number of objective and subjective factors, including external market conditions affecting the biotechnology industry sector and the prices at which the Company sold shares of convertible preferred stock, the superior rights and preferences of securities senior to the Company’s common stock at the time and the likelihood of achieving a liquidity event, such as an initial public offering or sale of the Company. The Company utilized various valuation methodologies in accordance with the framework of the American Institute of Certified Public Accountants, or AICPA, Audit and Accounting Practice Aid Series: Valuation of Privately Held Company Equity Securities Issued as Compensation, or the AICPA Practice Aid, to estimate the fair value of its common stock and in performing retrospective valuation analyses for certain grant dates prior to the IPO. The methodologies included the option pricing method utilizing the back-solve method (a form of the market approach defined in the AICPA Practice Aid) and the probability-weighted expected return method based upon the probability of occurrence of certain future liquidity events such as an initial public offering or sale of the Company. Each valuation methodology included estimates and assumptions that require the Company’s judgment. Significant changes to the key assumptions used in the valuations could result in different fair values of common stock at each valuation date. |
Revenue Recognition | Revenue Recognition |
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The Company recognizes revenue in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) 605, Revenue Recognition. Accordingly, revenue is recognized for each unit of accounting when all of the following criteria are met: |
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| • | | persuasive evidence of an arrangement exists; | | | | | | | | | | | | | |
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| • | | delivery has occurred or services have been rendered; | | | | | | | | | | | | | |
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| • | | the seller’s price to the buyer is fixed or determinable; and | | | | | | | | | | | | | |
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| • | | collectability is reasonably assured. | | | | | | | | | | | | | |
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The Company’s revenue has primarily been generated from a Discovery and Development Collaboration and License Agreement with Celgene (“the Celgene Agreement”) and from research grant agreements. |
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Collaboration and License Revenue |
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In January 2011, the Company adopted the FASB Accounting Standards Update (“ASU”) No. 2009-13, Multiple-Element Revenue Arrangements (“ASU No. 2009-13”), on a prospective basis for all revenue arrangements entered into or materially modified after the adoption date. The Celgene Agreement was entered into prior to January 1, 2011 and the Company initially applied its prior accounting policy with respect to the arrangement. Under this policy, when evaluating multiple element arrangements, the Company considered whether the components of the arrangement should be accounted for individually as separate units of accounting if (1) the elements have stand-alone value, and (2) the Company is able to estimate the fair value of all undelivered elements under the arrangement. |
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In July 2014, the Company amended its collaboration agreement with Celgene. As a result of the amendment, the Company was required to reevaluate the agreement under ASU No. 2009-13. The amendment was determined to be a material modification pursuant to ASU No. 2009-13, and the Company began recognizing revenue for the arrangement under this guidance on a prospective basis, as discussed further in Note 3. |
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Pursuant to ASU 2009-13, revenue arrangements where multiple products or services are sold together are evaluated to determine if each deliverable represents a separate unit of accounting based on the following criteria: |
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| • | | Delivered item or items have value to the customer on a standalone basis, and | | | | | | | | | | | | | |
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| • | | If the arrangement includes a general right of return relative to the delivered item or items, delivery or performance of the undelivered item or items is considered probable and substantially in the control of the vendor. | | | | | | | | | | | | | |
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The arrangement consideration is then allocated to each separately identified unit of accounting based on the relative selling price, using the Company’s best estimate of selling price of each deliverable. The provisions of ASC 605-25, Multiple-Element Arrangements are then applied to each unit of accounting to determine the appropriate revenue recognition. In the event that a deliverable of a multiple element arrangement does not represent a separate unit of accounting, the Company recognizes revenue from the combined units of accounting over the term of the related contract or as undelivered items are delivered, as appropriate. |
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In determining the current and noncurrent classification of deferred revenue, the Company considers the total consideration expected to be earned in the next twelve months for services to be performed under certain units of accounting and the estimated proportional performance and timing of delivery of certain deliverables to determine the deferred revenue balance that will remain twelve months from the balance sheet date. |
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Revenue is recognized under the proportional performance method for certain units of accounting. The amount recognized is determined based on the consideration allocated to each unit of accounting based on the ratio of the level of effort incurred to date compared to the total estimated level of effort required to complete the Company’s performance obligations under the unit of accounting. Determining the total estimated level of effort required to complete all performance obligations requires management judgment and estimation, including assumptions regarding future operating performance, the timelines of the clinical trials approvals and the estimated patient populations. |
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In January 2011, the Company adopted the FASB’s ASU No. 2010-17, Revenue Recognition – Milestone Method, on a prospective basis. ASU 2010-17 provides guidance in applying the milestone method of revenue recognition to research or development arrangements. Under this guidance, management may recognize revenue contingent upon the achievement of a milestone in its entirety in the period in which the milestone is achieved, only if the milestone meets all the criteria within the guidance to be considered substantive. In accordance with ASU 2010-17, at the inception of each arrangement that includes milestone payments, the Company evaluates each contingent payment on an individual basis to determine whether they are considered substantive milestones, specifically reviewing factors such as the degree of certainty in achieving the milestone, the research and development risk and other risks that must be overcome to achieve the milestone, as well as the level of effort and investment required and whether the milestone consideration is reasonable relative to all deliverables and payment terms in the arrangement. This evaluation includes an assessment of whether (a) the consideration is commensurate with either (1) the entity’s performance to achieve the milestone, or (2) the enhancement of the value of the delivered item(s) as a result of a specific outcome resulting from the entity’s performance to achieve the milestone, (b) the consideration relates solely to past performance and (c) the consideration is reasonable relative to all of the deliverables and payment terms within the arrangement. |
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Revenues from milestones, if they are nonrefundable and deemed substantive, are recognized upon achievement of the milestones. The Company recognizes revenue associated with the non-substantive milestones upon achievement of the milestone if there are no undelivered elements and the Company has no remaining performance obligations. |
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Reimbursement of research and development costs by Celgene is recognized as revenue, provided the Company has determined that it is acting primarily as a principal in the transaction according to the provisions outlined in FASB ASC 605-45, Revenue Recognition – Principal Agent Considerations, the amounts are determinable and collection of the related receivable is reasonably assured. |
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Grant Revenue |
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Revenue related to research grant agreements is recognized as the underlying services are performed and delivered. Revenues from grants totaled approximately $0.1 million for the year ended December 31, 2012. The Company did not recognize any grant revenue for the years ended December 31, 2014 and 2013. |
Research and Development Costs | Research and Development Costs |
Research and development costs are expensed as incurred. Research and development costs include salaries and personnel-related costs, consulting fees, fees paid for contract research services, fees paid to clinical research organizations and other third parties associated with clinical trials, the costs of laboratory equipment and facilities, and other external costs. |
Nonrefundable advance payments for goods or services to be received in the future for use in research and development activities are deferred and capitalized. The capitalized amounts are expensed as the related goods are delivered or the services are performed. |
Stock-Based Compensation | Stock-Based Compensation |
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The Company accounts for its stock-based compensation awards in accordance with ASC Topic 718, Compensation – Stock Compensation (“ASC 718”). ASC 718 requires all share-based payments to employees, including grants of employee stock options, to be recognized in the consolidated statements of operations based on their grant date fair values. For stock options granted to employees and to members of the board of directors for their services on the board of directors, the Company estimates the grant date fair value of each option award using the Black-Scholes option-pricing model. The use of the Black-Scholes option-pricing model requires management to make assumptions with respect to the expected term of the option, the expected volatility of the common stock consistent with the expected life of the option, risk-free interest rates and expected dividend yields of the common stock. For awards subject to service-based vesting conditions, the Company recognizes stock-based compensation expense, net of estimated forfeitures, equal to the grant date fair value of stock options on a straight-line basis over the requisite service period. For awards subject to both performance and service-based vesting conditions, the Company recognizes stock-based compensation expense using an accelerated recognition method if achievement of the performance criteria is considered probable. |
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Share-based payments issued to non-employees are recorded at their fair values, and are revalued at each reporting date and as the equity instruments vest and are recognized as expense over the related service period in accordance with the provisions of ASC Topic 505, Equity. For equity instruments granted to non-employees, the Company recognizes stock-based compensation expense using an accelerated recognition method. |
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During the years ended December 31, 2014, 2013, and 2012, the Company recorded stock-based compensation expense for employee and non-employee stock options, the employee stock purchase plan and restricted stock, which was allocated as follows in the consolidated statements of operations (in thousands): |
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| | Years Ended December 31, | | | | | |
| | 2014 | | | 2013 | | | 2012 | | | | | |
Research and development expense | | $ | 6,688 | | | $ | 2,001 | | | $ | 605 | | | | | |
General and administrative expense | | | 4,818 | | | | 1,029 | | | | 137 | | | | | |
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| | $ | 11,506 | | | $ | 3,030 | | | $ | 742 | | | | | |
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No related tax benefits were recognized for the years ended December 31, 2014, 2013 and 2012. |
Income Taxes | Income Taxes |
Income taxes are recorded in accordance with ASC 740, Accounting for Income Taxes (“ASC 740”), which provides for deferred taxes using an asset and liability approach. The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. The Company determines its deferred tax assets and liabilities based on differences between financial reporting and tax bases of assets and liabilities, which are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Valuation allowances are provided, if based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. |
The Company accounts for uncertain tax positions in accordance with the provisions of ASC 740. When uncertain tax positions exist, the Company recognizes the tax benefit of tax positions to the extent that the benefit will more likely than not be realized. The determination as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position as well as consideration of the available facts and circumstances. As of December 31, 2014 and 2013, the Company did not have any uncertain tax positions. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) |
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Comprehensive income (loss) is defined as the change in equity of a business enterprise during a period from transactions, and other events and circumstances from non-owner sources, and currently consists of net loss and changes in unrealized gains and losses on available-for-sale securities. Accumulated other comprehensive loss consists entirely of unrealized gains and losses from available for sale securities as of December 31, 2014 and 2013. |
Cash and Cash Equivalents | Cash and Cash Equivalents |
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The Company considers highly liquid investments with a maturity of ninety days or less when purchased to be cash equivalents. Cash equivalents, which consist primarily of money market funds, are stated at fair value. |
Marketable Securities | Marketable Securities |
Marketable securities at December 31, 2014 and 2013 consisted primarily of investments in United States Treasuries and certificates of deposit. Management determines the appropriate classification of the securities at the time they are acquired and evaluates the appropriateness of such classifications at each balance sheet date. The Company classifies its marketable securities as available-for-sale pursuant to ASC 320, Investments – Debt and Equity Securities. Marketable securities are recorded at fair value, with unrealized gains and losses included as a component of accumulated other comprehensive income (loss) in stockholders’ equity and a component of total comprehensive loss in the consolidated statements of comprehensive loss, until realized. The fair value of these securities is based on quoted prices for identical or similar assets. Realized gains and losses are included in investment income on a specific-identification basis. There were no realized gains or losses on marketable securities for the years ended December 31, 2014, 2013 and 2012. |
The Company reviews marketable securities for other-than-temporary impairment whenever the fair value of a marketable security is less than the amortized cost and evidence indicates that a marketable security’s carrying amount is not recoverable within a reasonable period of time. Other-than-temporary impairments of investments are recognized in the consolidated statements of operations if the Company has experienced a credit loss, has the intent to sell the marketable security, or if it is more likely than not that the Company will be required to sell the marketable security before recovery of the amortized cost basis. Evidence considered in this assessment includes reasons for the impairment, compliance with the Company’s investment policy, the severity and the duration of the impairment and changes in value subsequent to the end of the period. |
Marketable securities at December 31, 2014 consist of the following (in thousands): |
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| | Amortized | | | Unrealized | | | Unrealized | | | Fair | |
Cost | Gains | Losses | Value |
Current: | | | | | | | | | | | | | | | | |
Certificates of deposit | | $ | 13,160 | | | $ | — | | | $ | (5 | ) | | $ | 13,155 | |
U.S. Treasuries | | | 314,866 | | | | 45 | | | | (32 | ) | | | 314,879 | |
Non-current: | | | | | | | | | | | | | | | | |
U.S. Treasuries | | | 125,447 | | | | 5 | | | | (70 | ) | | | 125,382 | |
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| | $ | 453,473 | | | $ | 50 | | | $ | (107) | | | $ | 453,416 | |
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Marketable securities at December 31, 2013 consist of the following (in thousands): |
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| | Amortized | | | Unrealized | | | Unrealized | | | Fair | |
Cost | Gains | Losses | Value |
Current: | | | | | | | | | | | | | | | | |
Certificates of deposit | | $ | 6,920 | | | $ | — | | | $ | (5 | ) | | $ | 6,915 | |
U.S. Treasuries | | | 88,287 | | | | 8 | | | | (1 | ) | | | 88,294 | |
Non-current: | | | | | | | | | | | | | | | | |
U.S. Treasuries | | | 27,113 | | | | 12 | | | | — | | | | 27,125 | |
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| | $ | 122,320 | | | $ | 20 | | | $ | -6 | | | $ | 122,334 | |
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At December 31, 2014 and 2013, the Company held both current and non-current investments. Investments classified as current have maturities of less than one year. Investments classified as non-current are those that (i) have maturities of one to two years and (ii) management does not intend to liquidate within the next twelve months, although these funds are available for use and therefore classified as available-for-sale. |
At December 31, 2014 and 2013, the Company held 92 and 33 debt securities, respectively, that were in an unrealized loss position for less than one year. The aggregate fair value of debt securities in an unrealized loss position at December 31, 2014 and 2013 was $236.9 million and $31.7 million, respectively. There were no individual securities that were in a significant unrealized loss position or that had been in an unrealized loss position for greater than one year as of December 31, 2014 and 2013. The Company evaluated its securities for other-than-temporary impairment and considered the decline in market value for the securities to be primarily attributable to current economic and market conditions. It is not more likely than not that the Company will be required to sell the securities, and the Company does not intend to do so prior to the recovery of the amortized cost basis. Based on this analysis, these marketable securities were not considered to be other-than-temporarily impaired as of December 31, 2014 and 2013. |
Concentrations of Credit Risk | Concentrations of Credit Risk |
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Financial instruments which potentially subject the Company to credit risk consist primarily of cash, cash equivalents and marketable securities. The Company holds these investments in highly rated financial institutions, and, by policy, limits the amounts of credit exposure to any one financial institution. These amounts at times may exceed federally insured limits. The Company has not experienced any credit losses in such accounts and does not believe it is exposed to any significant credit risk on these funds. The Company has no off-balance sheet concentrations of credit risk, such as foreign currency exchange contracts, option contracts or other hedging arrangements. |
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The Company is also subject to credit risk from its collaboration receivable. The Company evaluates the creditworthiness of its collaborator and has determined it is credit worthy. To date the Company has not experienced any losses with respect to its collaboration receivable. |
Fair Value Measurements | Fair Value Measurements |
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The Company records cash equivalents and marketable securities at fair value. ASC Topic 820, Fair Value Measurements and Disclosures, establishes a fair value hierarchy for those instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable inputs). The hierarchy consists of three levels: |
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Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities. |
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Level 2 – Quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability. |
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Level 3 – Unobservable inputs that reflect the Company’s own assumptions about the assumptions market participants would use in pricing the asset or liability in which there is little, if any, market activity for the asset or liability at the measurement date. |
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The following table summarizes the cash equivalents and marketable securities measured at fair value on a recurring basis as of December 31, 2014 (in thousands): |
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| | Level 1 | | | Level 2 | | | Level 3 | | | Total | |
Cash equivalents | | $ | 11,410 | | | $ | 960 | | | $ | — | | | $ | 12,370 | |
Marketable securities: | | | | | | | | | | | | | | | | |
Certificates of deposit | | | — | | | | 13,155 | | | | — | | | | 13,155 | |
U.S. Treasuries | | | 440,261 | | | | — | | | | — | | | | 440,261 | |
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| | $ | 451,671 | | | $ | 14,115 | | | $ | — | | | $ | 465,786 | |
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The following table summarizes the cash equivalents and marketable securities measured at fair value on a recurring basis as of December 31, 2013 (in thousands): |
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| | Level 1 | | | Level 2 | | | Level 3 | | | Total | |
Cash equivalents | | $ | 68,792 | | | $ | — | | | $ | — | | | $ | 68,792 | |
Marketable securities: | | | | | | | | | | | | | | | | |
Certificates of deposit | | | — | | | | 6,915 | | | | — | | | | 6,915 | |
U.S. Treasuries | | | 115,419 | | | | — | | | | — | | | | 115,419 | |
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| | $ | 184,211 | | | $ | 6,915 | | | $ | — | | | $ | 191,126 | |
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Cash equivalents and marketable securities have been initially valued at the transaction price and subsequently valued, at the end of each reporting period, utilizing third party pricing services or other market observable data. The pricing services utilize industry standard valuation models, including both income and market based approaches and observable market inputs to determine value. The Company validates the prices provided by its third party pricing services by reviewing their pricing methods and obtaining market values from other pricing sources. After completing its validation procedures, the Company did not adjust or override any fair value measurements provided by the pricing services as of December 31, 2014 or 2013. |
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The carrying amounts reflected in the consolidated balance sheets for cash, restricted cash, collaboration receivable – related party, prepaid expenses and other current assets, other assets, accounts payable, and accrued expenses approximate their fair values at December 31, 2014 and 2013, due to their short-term nature. |
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There have been no changes to the valuation methods during the years ended December 31, 2014 and 2013. The Company evaluates transfers between levels at the end of each reporting period. There were no transfers of assets or liabilities between Level 1 and Level 2 during the years ended December 31, 2014 and 2013. The Company had no financial assets or liabilities that were classified as Level 3 at any point during the years ended December 31, 2014 and 2013. |
Collaboration and Other Receivables | Collaboration and Other Receivables |
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Collaboration receivables as of December 31, 2014 represent amounts due from Celgene for cost reimbursements of certain on-going phase 1 studies under the Celgene Agreement. As of December 31, 2013, collaboration receivables represented an unbilled collaboration receivable for revenues recognized related to Celgene’s election to extend the term of the initial discovery period from four to five years. Other receivables represent amounts due from the Company’s landlord for reimbursement of tenant improvements under the Company’s lease agreement. |
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The Company estimates an allowance for doubtful accounts based on credit worthiness, historical payment patterns, aging of accounts receivable balances, and general economic conditions. As of December 31, 2014 and 2013, the Company had no allowance for doubtful accounts. |
Property and Equipment | Property and Equipment |
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Property and equipment consist of laboratory equipment, computer equipment and software, leasehold improvements, furniture and fixtures, and office equipment. Property and equipment is stated at cost, and depreciated using the straight-line method over the estimated useful lives of the respective assets: |
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| | Laboratory equipment | | 5 years | | | | | | | | | | | | |
| | Computer equipment and software | | 3 years | | | | | | | | | | | | |
| | Leasehold improvements | | Shorter of asset’s useful | | | | | | | | | | | | |
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life or remaining term of lease | | | | | | | | | | |
| | Furniture and fixtures | | 5 years | | | | | | | | | | | | |
| | Office equipment | | 5 years | | | | | | | | | | | | |
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Costs of major additions and betterments are capitalized; maintenance and repairs, which do not improve or extend the life of the respective assets, are charged to expense as incurred. Upon retirement or sale, the cost of the disposed asset and the related accumulated depreciation are removed from the accounts and the resulting gain or loss is recognized. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets |
The Company periodically evaluates its long-lived assets for potential impairment in accordance with ASC Topic 360, Property, Plant and Equipment. Potential impairment is assessed when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recovered. Recoverability of these assets is assessed based on undiscounted expected future cash flows from the assets, considering a number of factors, including past operating results, budgets and economic projections, market trends and product development cycles. If impairments are identified, assets are written down to their estimated fair value. The Company has not recognized any impairment charges through December 31, 2014. |
Segment and Geographic Information | Segment and Geographic Information |
Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, or decision making group, in making decisions on how to allocate resources and assess performance. The Company’s chief operating decision maker is the chief executive officer. The Company and the chief decision maker view the Company’s operations and manage its business as one operating segment. The Company operates in only one geographic segment. |
Subsequent Events | Subsequent Events |
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The Company considered events or transactions occurring after the balance sheet date but prior to the issuance of the consolidated financial statements are available to be issued for potential recognition or disclosure in its consolidated financial statements. All significant subsequent events have been properly disclosed in the consolidated financial statements. |
Net Loss Per Share Applicable to Common Stockholders | Net Loss per Share Applicable to Common Stockholders |
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Basic net loss per share applicable to common stockholders is calculated by dividing net loss applicable to common stockholders by the weighted average shares outstanding during the period, without consideration for common stock equivalents. Net loss applicable to common stockholders is calculated by adjusting the net loss of the Company for cumulative preferred stock dividends. Diluted net loss per share applicable to common stockholders is calculated by adjusting weighted average shares outstanding for the dilutive effect of common stock equivalents outstanding for the period, determined using the treasury-stock method. For purposes of the dilutive net loss per share applicable to common stockholders calculation, preferred stock, stock options, and unvested restricted stock are considered to be common stock equivalents but are excluded from the calculation of diluted net loss per share applicable to common stockholders as their effect would be anti-dilutive; therefore, basic and diluted net loss per share applicable to common stockholders were the same for all periods presented. The following common stock equivalents were excluded from the calculation of diluted net loss per share applicable to common stockholders for the periods indicated because including them would have had an anti-dilutive effect: |
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| | Years ended December 31, | | | | | |
| | 2014 | | | 2013 | | | 2012 | | | | | |
Convertible preferred stock | | | - | | | | - | | | | 19,731,564 | | | | | |
Stock options | | | 3,805,420 | | | | 3,846,168 | | | | 3,145,544 | | | | | |
Unvested restricted stock | | | 8,522 | | | | 23,295 | | | | 160,053 | | | | | |
Employee stock purchase plan shares | | | 7,159 | | | | - | | | | - | | | | | |
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| | | 3,821,101 | | | | 3,869,463 | | | | 23,037,161 | | | | | |
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Recent Accounting Pronouncements | Recent Accounting Pronouncements |
In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40). The ASU requires all entities to evaluate for the existence of conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the issuance date of the financial statements. The accounting standard is effective for interim and annual periods ending after December 15, 2016, and will not have a material impact on the consolidated financial statements, but may impact the Company’s footnote disclosures. |
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In June 2014, the FASB issued ASU No. 2014-12, Compensation—Stock Compensation (Topic 718). The ASU clarifies how entities should treat performance targets that can be achieved after the requisite service period of a share-based payment award. The accounting standard is effective for interim and annual periods beginning after December 15, 2015 and is not expected to have a material impact on the consolidated financial statements. |
In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606). The ASU provides for a single comprehensive model for use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance. The accounting standard is effective for interim and annual periods beginning after December 15, 2016 with no early adoption permitted. The Company is required to adopt the amendments in the ASU using one of two acceptable methods. The Company is currently in the process of determining which adoption method it will apply and evaluating the impact of the guidance on its consolidated financial statements. |
Other accounting standards that have been issued by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the Company’s financial statements upon adoption. |