Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Jan. 31, 2022 | Jun. 30, 2021 | |
Cover [Abstract] | |||
Entity Central Index Key | 0001446847 | ||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2021 | ||
Document Transition Report | false | ||
Entity File Number | 001-34620 | ||
Entity Registrant Name | IRONWOOD PHARMACEUTICALS, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 04-3404176 | ||
Entity Address, Address Line One | 100 Summer Street | ||
Entity Address, Address Line Two | Suite 2300 | ||
Entity Address, City or Town | Boston | ||
Entity Address, State or Province | MA | ||
Entity Address, Postal Zip Code | 02110 | ||
City Area Code | 617 | ||
Local Phone Number | 621-7722 | ||
Title of 12(b) Security | Class A Common Stock, $0.001 par value | ||
Entity Listing, Par Value Per Share | $ 0.001 | ||
Trading Symbol | IRWD | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
ICFR Auditor Attestation Flag | true | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 1,858,612,775 | ||
Entity Common Stock, Shares Outstanding | 159,221,969 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Auditor Name | Ernst & Young LLP | ||
Auditor Firm ID | 42 | ||
Auditor Location | Boston, Massachusetts |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 620,129 | $ 362,564 |
Accounts receivable, net | 114,042 | 122,351 |
Prepaid expenses and other current assets | 8,689 | 9,189 |
Restricted cash | 1,250 | 1,735 |
Convertible note hedges | 1,115 | |
Total current assets | 745,225 | 495,839 |
Restricted cash, net of current portion | 485 | 485 |
Accounts receivable, net of current portion | 23,998 | 23,401 |
Property and equipment, net | 7,575 | 8,929 |
Operating lease right-of-use assets | 15,350 | 16,576 |
Convertible note hedges | 13,065 | |
Deferred tax assets | 333,294 | |
Other assets | 1,000 | 943 |
Total assets | 1,126,927 | 559,238 |
Current liabilities: | ||
Accounts payable | 935 | 661 |
Accrued research and development costs | 15,896 | 1,898 |
Accrued expenses and other current liabilities | 23,566 | 26,486 |
Current portion of operating lease liabilities | 3,127 | 3,128 |
Current portion of convertible senior notes | 116,858 | |
Note hedge warrants | 1,316 | |
Total current liabilities | 161,698 | 32,173 |
Note hedge warrants | 12,088 | |
Convertible senior notes, net of current portion | 337,333 | 430,256 |
Operating lease obligations, net of current portion | 18,484 | 20,318 |
Other liabilities | 3,501 | 1,763 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value, 75,000,000 shares authorized, no shares issued and outstanding | ||
Class A Common Stock, $0.001 par value, 500,000,000 shares authorized and XXX shares issued and outstanding at December 31, 2021 and 500,000,000 shares authorized and 160,616,675 shares issued and outstanding at December 31, 2020 | 162 | 161 |
Additional paid-in capital | 1,543,357 | 1,528,535 |
Accumulated deficit | (937,608) | (1,466,056) |
Total stockholders' equity | 605,911 | 62,640 |
Total liabilities and stockholders' equity | $ 1,126,927 | $ 559,238 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2021 | Dec. 31, 2020 |
Preferred stock | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 75,000,000 | 75,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 162,036,461 | 160,616,675 |
Common stock, shares outstanding | 162,036,461 | 160,616,675 |
Consolidated Statements of Inco
Consolidated Statements of Income and Comprehensive Income - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Revenues: | |||
Total revenues | $ 413,753 | $ 389,523 | $ 428,413 |
Cost and expenses: | |||
Cost of revenues | 3,136 | 23,875 | |
Settlement on non-cancellable purchase commitments | (3,530) | ||
Research and development | 70,405 | 88,062 | 115,044 |
Selling, general and administrative | 111,133 | 140,003 | 172,450 |
Gain on lease modification | (3,169) | ||
Restructuring expenses | (44) | 15,382 | 3,620 |
Total cost and expenses | 181,494 | 246,583 | 308,290 |
Income from operations | 232,259 | 142,940 | 120,123 |
Other (expense) income: | |||
Interest expense | (31,150) | (29,478) | (36,602) |
Interest and investment income | 726 | 1,504 | 2,862 |
Gain (loss) on derivatives | (1,178) | (6,129) | 3,023 |
Loss on extinguishment of debt | (30,977) | ||
Other income | 24 | 514 | |
Other expense, net | (31,602) | (34,079) | (61,180) |
Income from continuing operations, before income taxes | 200,657 | 108,861 | 58,943 |
Income tax (expense) benefit | 327,791 | (2,685) | |
Income from continuing operations | 528,448 | 106,176 | 58,943 |
Loss from discontinued operations, net of income taxes | (37,438) | ||
Net income | 528,448 | 106,176 | 21,505 |
Comprehensive income | $ 528,448 | $ 106,176 | $ 21,505 |
Income per share from continuing operations, net of income taxes - basic (in dollars per share) | $ 3.26 | $ 0.67 | $ 0.38 |
Income per share from continuing operations, net of income taxes - diluted (in dollars per share) | 3.21 | 0.66 | 0.38 |
Loss per share from discontinued operations, net of income taxes - basic (in dollars per share) | (0.24) | ||
Loss per share from discontinued operations, net of income taxes - diluted (in dollars per share) | (0.24) | ||
Net income per share - basic (in dollars per share) | 3.26 | 0.67 | 0.14 |
Net income per share - diluted (in dollars per share) | $ 3.21 | $ 0.66 | $ 0.14 |
Weighted average shares used in computing net income per share - basic: (in shares) | 162,245 | 159,427 | 156,023 |
Weighted average shares used in computing net income per share - diluted: (in shares) | 164,418 | 160,655 | 156,023 |
Collaborative arrangements revenue | |||
Revenues: | |||
Total revenues | $ 412,784 | $ 381,545 | $ 379,652 |
Sale of active pharmaceutical ingredient | |||
Revenues: | |||
Total revenues | $ 969 | $ 7,978 | $ 48,761 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Deficit) - USD ($) $ in Thousands | Common Stock | Additional paid-in capital | Accumulated deficit | Total |
Balance at Dec. 31, 2018 | $ 154 | $ 1,394,603 | $ (1,591,128) | $ (196,371) |
Balance (in shares) at Dec. 31, 2018 | 154,414,691 | |||
Increase (Decrease) in Stockholders' Equity (Deficit) | ||||
Issuance of common stock upon exercise of stock options and employee stock purchase plan, net of cancellations | $ 4 | 13,597 | 13,601 | |
Issuance of common stock upon exercise of stock options and employee stock purchase plan, net of cancellations (in shares) | 3,121,271 | |||
Share-based compensation expense related to share-based awards and employee stock purchase plan | (32,331) | (32,331) | ||
Equity component of convertible senior notes | 92,502 | 92,502 | ||
Equity component of issuance costs for convertible senior notes | (2,092) | (2,092) | ||
Purchase of capped calls | (25,159) | (25,159) | ||
Equity component of the partial repurchase of the 2022 Convertible Notes | (26,959) | (26,959) | ||
Dividend of sGC business | (2,609) | (2,609) | ||
Net income | 21,505 | 21,505 | ||
Balance at Dec. 31, 2019 | $ 158 | 1,478,823 | (1,572,232) | (93,251) |
Balance (in shares) at Dec. 31, 2019 | 157,535,962 | |||
Increase (Decrease) in Stockholders' Equity (Deficit) | ||||
Issuance of common stock related to share-based awards and employee stock purchase plan | $ 3 | 18,537 | 18,540 | |
Issuance of common stock related to share-based awards and employee stock purchase plan (in shares) | 3,080,713 | |||
Share-based compensation expense related to share-based awards and employee stock purchase plan | 31,175 | 31,175 | ||
Net income | 106,176 | 106,176 | ||
Balance at Dec. 31, 2020 | $ 161 | 1,528,535 | (1,466,056) | $ 62,640 |
Balance (in shares) at Dec. 31, 2020 | 160,616,675 | 160,616,675 | ||
Increase (Decrease) in Stockholders' Equity (Deficit) | ||||
Issuance of common stock related to share-based awards and employee stock purchase plan | $ 3 | 19,678 | $ 19,681 | |
Issuance of common stock related to share-based awards and employee stock purchase plan (in shares) | 3,776,786 | |||
Share-based compensation expense related to share-based awards and employee stock purchase plan | 22,281 | 22,281 | ||
Repurchases of common stock | $ (2) | (27,137) | $ (27,139) | |
Repurchases of common stock (in shares) | (2,357,000) | (2,400,000) | ||
Net income | 528,448 | $ 528,448 | ||
Balance at Dec. 31, 2021 | $ 162 | $ 1,543,357 | $ (937,608) | $ 605,911 |
Balance (in shares) at Dec. 31, 2021 | 162,036,461 | 162,036,461 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Cash flows from operating activities: | |||
Net income | $ 528,448 | $ 106,176 | $ 21,505 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 1,523 | 3,564 | 5,580 |
Loss on disposal of property and equipment | 93 | 470 | 146 |
Share-based compensation expense | 22,281 | 31,175 | 31,278 |
Gain on lease modification | (3,169) | ||
Change in fair value of note hedge warrants | (10,772) | (12,172) | 16,232 |
Change in fair value of convertible note hedges | 11,950 | 18,301 | (19,255) |
Settlement on non-cancellable purchase commitments | (3,530) | ||
Non-cash interest expense | 23,935 | 22,263 | 19,590 |
Deferred income taxes (including benefit from valuation allowance release) | (333,294) | ||
Loss on extinguishment of debt | 30,977 | ||
Changes in assets and liabilities: | |||
Accounts receivable and related party accounts receivable, net | 7,712 | 4,091 | (68,893) |
Prepaid expenses and other current assets | 601 | 1,515 | (1,046) |
Inventory, net | 648 | ||
Operating lease right-of-use assets | 1,226 | 1,167 | 14,141 |
Other assets | (57) | (153) | 159 |
Accounts payable, related party accounts payable and accrued expenses | (2,644) | (7,523) | (32,700) |
Accrued research and development costs | 13,998 | (1,058) | (483) |
Operating lease liabilities | (1,835) | 218 | (12,046) |
Deferred revenue | (875) | 875 | |
Other liabilities | (1,270) | 1,029 | |
Net cash provided by (used in) continuing operating activities | 261,895 | 168,836 | (639) |
Net cash provided by discontinued operating activities | 11,364 | ||
Net cash provided by operating activities | 261,895 | 168,836 | 10,725 |
Cash flows from investing activities: | |||
Purchase of property and equipment | (265) | (1,842) | (7,189) |
Proceeds from sale of property and equipment | 268 | ||
Net cash (used in) continuing investing activities | (265) | (1,842) | (6,921) |
Net cash (used in) discontinued investing activities | (4,223) | ||
Net cash (used in) investing activities | (265) | (1,842) | (11,144) |
Cash flows from financing activities: | |||
Proceeds from issuance of convertible senior notes | 400,000 | ||
Purchase of capped calls | (25,159) | ||
Proceeds from partial termination of convertible note hedges and note hedge warrants | 3,174 | ||
Costs associated with issuance of convertible senior notes | (9,048) | ||
Proceeds from exercise of stock options and employee stock purchase plan | 19,581 | 18,546 | 13,595 |
Repurchases of common stock | (24,131) | ||
Payments for partial repurchase of 2022 Convertible Notes | (227,338) | ||
Payments on 8.375% Notes due 2026 | (156,409) | ||
Net cash provided by financing activities | (4,550) | 18,546 | (1,185) |
Net increase in cash, cash equivalents and restricted cash | 257,080 | 185,540 | (1,604) |
Cash, cash equivalents and restricted cash, beginning of period | 364,784 | 179,244 | 180,848 |
Cash, cash equivalents and restricted cash, end of period | 621,864 | 364,784 | 179,244 |
Supplemental cash flow disclosure: | |||
Cash paid for interest | 7,216 | 7,216 | 17,584 |
Cash paid for income taxes | 3,452 | $ 1,848 | |
Non-cash investing and financing activities | |||
Recognition of asset retirement obligation | 486 | ||
Fixed asset purchases in accounts payable and accrued expenses | $ 1,282 | ||
Stock repurchases payable in accrued expenses | $ 3,009 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Reconciliation of cash, cash equivalents, and restricted cash to the condensed consolidated balance sheets | ||||
Cash and cash equivalents | $ 620,129 | $ 362,564 | $ 177,023 | |
Restricted cash | 1,735 | 2,220 | 2,221 | |
Total cash, cash equivalents, and restricted cash | $ 621,864 | $ 364,784 | $ 179,244 | $ 180,848 |
Nature of Business
Nature of Business | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Text Block | |
Nature of Business | 1. Nature of Business Ironwood Pharmaceuticals, Inc. (“Ironwood” or the “Company”) is a gastrointestinal (“GI”) healthcare company dedicated to advancing the treatment of GI diseases and redefining the standard of care for GI patients. The Company is focused on the development and commercialization of innovative GI product opportunities in areas of significant unmet need, leveraging its demonstrated expertise and capabilities in GI diseases. LINZESS ® (linaclotide), the Company’s commercial product, is the first product approved by the United States Food and Drug Administration (the “U.S. FDA”) in a class of GI medicines called guanylate cyclase type C agonists and is indicated for adult men and women suffering from irritable bowel syndrome with constipation (“IBS-C”) or chronic idiopathic constipation (“CIC”). LINZESS is available to adult men and women suffering from IBS-C or CIC in the United States (the “U.S.”) and Mexico and to adult men and women suffering from IBS-C in Japan and China. Linaclotide is available under the trademarked name CONSTELLA ® The Company has strategic partnerships with leading pharmaceutical companies to support the development and commercialization of linaclotide throughout the world. The Company and its partner, AbbVie Inc. (together with its affiliates, “AbbVie”), began commercializing LINZESS in the U.S. in December 2012. Under the Company’s collaboration for North America with AbbVie, total net sales of LINZESS in the U.S., as recorded by AbbVie, are reduced by commercial costs incurred by each party, and the resulting amount is shared equally between the Company and AbbVie. Additionally, development costs are shared equally between the Company and AbbVie. AbbVie also has an exclusive license from the Company to develop and commercialize linaclotide in all countries other than China (including Hong Kong and Macau), Japan and the countries and territories of North America (the “AbbVie License Territory”). On a country-by-country and product-by-product basis in the AbbVie License Territory, AbbVie pays the Company a royalty as a percentage of net sales of products containing linaclotide as an active ingredient. In addition, AbbVie has exclusive rights to commercialize linaclotide in Canada as CONSTELLA and in Mexico as LINZESS. Astellas Pharma Inc. (“Astellas”), the Company’s partner in Japan, has an exclusive license to develop and commercialize linaclotide in Japan. In March 2017, Astellas began commercializing LINZESS for the treatment of adults with IBS-C in Japan, and in September 2018, Astellas began commercializing LINZESS for the treatment of adults with chronic constipation in Japan. In August 2019, the Company amended and restated its license agreement with Astellas. Effective in 2020, Company is no longer responsible for the supply of linaclotide active pharmaceutical ingredient (“API”) to Astellas (Note 5). In October 2012, the Company and AstraZeneca AB (together with its affiliates) (“AstraZeneca”) entered into a collaboration agreement to co-develop and co-commercialize linaclotide in China (including Hong Kong and Macau) (the “AstraZeneca License Territory”). In September 2019, the Company amended and restated its existing collaboration agreement with AstraZeneca whereby AstraZeneca obtained the exclusive right to develop, manufacture, and commercialize products containing linaclotide in the AstraZeneca License Territory (Note 5). In November 2019, AstraZeneca began commercializing LINZESS for the treatment of adults with IBS-C in China. In November 2021, the Company entered into a collaboration and license option agreement (the “COUR Collaboration Agreement”) with COUR Pharmaceutical Development Company, Inc. (“COUR”), a biotechnology company developing novel immune-modifying nanoparticles to treat autoimmune diseases. The COUR Collaboration Agreement grants the Company an option to acquire an exclusive license to research, develop, manufacture and commercialize, in the U.S., products containing CNP-104, a potential treatment for primary biliary cholangitis, a rare autoimmune disease targeting the liver. These and other agreements are more fully described in Note 5, Collaboration, License, and Other Agreements, The Company is also advancing IW-3300, a guanylate cyclase type C agonist, for the potential treatment of visceral pain conditions, including interstitial cystitis / bladder pain syndrome (IC/BPS) and endometriosis. In December 2021, the U.S. FDA accepted our Investigational New Drug Application, and the Phase I clinical program has commenced in the first quarter of 2022 to evaluate the safety and tolerability of IW-3300 in healthy volunteers. The Company was incorporated in Delaware on January 5, 1998 as Microbia, Inc. On April 7, 2008, the Company changed its name to Ironwood Pharmaceuticals, Inc. To date, the Company has dedicated a majority of its activities to the research, development and commercialization of linaclotide, as well as to the research and development of its other product candidates. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Text Block | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Principles of Consolidation The accompanying consolidated financial statements include the accounts of Ironwood and its wholly-owned subsidiaries, as of December 31, 2021, Ironwood Pharmaceuticals Securities Corporation and Ironwood Pharmaceuticals GmbH. Cyclerion Therapeutics, Inc. (“Cyclerion”) was a wholly-owned subsidiary until it became an independent publicly-traded company on April 1, 2019 (Note 3). All intercompany transactions and balances are eliminated in consolidation. Segment Information Operating segments are components of an enterprise for which separate financial information is available and is evaluated regularly by the Company’s chief operating decision-maker in deciding how to allocate resources and in assessing performance. The Company currently operates in one reportable business segment—human therapeutics. Reclassifications Certain prior period financial statement items have been reclassified to conform to current period presentation. Discontinued Operations The Company determined that its soluble guanylate cyclase (“sGC”) business, which was disposed on April 1, 2019, met the criteria for classification as a discontinued operation in accordance with Accounting Standards Codification (“ASC”) Subtopic 205-20, Discontinued Operations Cyclerion Separation Use of Estimates The preparation of consolidated financial statements in accordance with U.S. generally accepted accounting principles requires the Company’s management to make estimates and judgments that may affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the amounts of revenues and expenses during the reported periods. On an ongoing basis, the Company’s management evaluates its estimates, judgments and methodologies. Significant estimates and assumptions in the consolidated financial statements include those related to revenue recognition; accounts receivable; useful lives of long-lived assets, impairment of long-lived assets, including goodwill; valuation procedures for right-of-use assets and operating lease liabilities; valuation procedures for the issuance and repurchase of convertible notes; balance sheet classification of convertible notes; fair value of derivatives; income taxes, including the valuation allowance for deferred tax assets; research and development expenses; contingencies and share-based compensation. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results may differ materially from these estimates under different assumptions or conditions. Changes in estimates are reflected in reported results in the period in which they become known. Cash and Cash Equivalents The Company considers all highly liquid investment instruments with a remaining maturity when purchased of three months or less to be cash equivalents. Investments qualifying as cash equivalents primarily consist of money market funds, U.S. government-sponsored securities, and repurchase agreements. The carrying amount of cash equivalents approximates fair value. The amount of cash equivalents included in cash and cash equivalents was $595.2 million and $349.0 million at December 31, 2021 and 2020, respectively. Restricted Cash The Company is contingently liable under unused letters of credit with a bank, related to the Company’s facility lease and vehicle lease agreements, in the amount of $1.7 million and $2.2 million as of December 31, 2021 and 2020, respectively. The Company records as restricted cash the collateral used to secure these letters of credit. The amount of restricted cash included in current assets and non-current assets was $1.3 million and $0.5 million, respectively, at December 31, 2021. The amount of restricted cash in current assets and non-current assets was $1.7 million and $0.5 million, respectively, at December 31, 2020. Concentrations of Suppliers The Company relies on its collaboration partners and their suppliers to manufacture linaclotide API, linaclotide finished drug product, and finished goods. If any of the Company’s collaboration partners and their suppliers were to limit or terminate production or otherwise fail to meet the quality or delivery requirements needed to satisfy the supply commitments, the process of locating and qualifying alternate sources could require up to several months, during which time production could be delayed. Such delays could have a material adverse effect on the Company’s business, financial position and results of operations. Accounts Receivable and Related Valuation Account The Company makes judgments as to its ability to collect outstanding receivables and provides an allowance for credit losses when collection becomes doubtful. Provisions are made based upon a specific review of all significant outstanding invoices and the overall quality and age of those invoices not specifically reviewed. The Company’s receivables relate primarily to amounts reimbursed under its collaboration, license and co-promotion agreements. The Company believes that credit risks associated with these partners are not significant. The Company reviews the need for an allowance for credit losses for its receivables based on various factors including payment history and historical bad debt experience. The Company had no allowance for credit losses as of December 31, 2021 or 2020. Concentrations of Credit Risk Financial instruments that subject the Company to credit risk primarily consist of cash and cash equivalents, restricted cash, and accounts receivable. The Company maintains its cash and cash equivalent balances with high-quality financial institutions and the Company believes that such funds are subject to minimal credit risk. The Company has adopted an investment policy which limits the amounts the Company may invest in certain types of investments, and requires all investments held by the Company to be at least AA- rated, thereby reducing credit risk exposure. Accounts receivable primarily consist of amounts due under the linaclotide collaboration agreement with AbbVie for North America (Note 5). The Company does not obtain collateral for its accounts receivable. The Company previously reflected amounts due from Allergan, net of amounts payable to Allergan, prior to its acquisition by AbbVie as related party accounts receivable, net. Following the acquisition of Allergan by AbbVie, the Company determined that AbbVie is not a related party to the Company (Note 16). The percentages of revenue recognized from significant collaborative partners of the Company in the years ended December 31, 2021, 2020 and 2019 as well as the account receivable balances, net of any payables due, at December 31, 2021 and 2020 are included in the following table: Accounts Receivable Revenue December 31, Year Ended December 31, 2021 2020 2021 2020 2019 Collaborative Partner: AbbVie (North America and Europe) 81 % 76 % 98 % 96 % 78 % Astellas (Japan) 1 % 1 % 1 % 1 % 13 % Property and Equipment Property and equipment, including leasehold improvements, are recorded at cost, and are depreciated when placed into service using the straight-line method based on their estimated useful lives as follows: Estimated Useful Life Asset Description (In Years) Laboratory equipment 5 Computer and office equipment 3 Furniture and fixtures 7 Software 3 Included in property and equipment are certain costs of software obtained for internal use. Costs incurred during the preliminary project stage are expensed as incurred, while costs incurred during the application development stage are capitalized and amortized over the estimated useful life of the software. The Company also capitalizes costs related to specific upgrades and enhancements when it is probable the expenditures will result in additional functionality. Maintenance and training costs related to software obtained for internal use are expensed as incurred. Leasehold improvements are amortized over the shorter of the estimated useful life of the asset or the lease term. Costs for capital assets not yet placed into service have been capitalized as construction in process, and will be depreciated in accordance with the above guidelines once placed into service. Maintenance and repair costs are expensed as incurred. Impairment of Long-Lived Assets The Company regularly reviews the carrying amount of its long-lived assets to determine whether indicators of impairment may exist, which warrant adjustments to carrying values or estimated useful lives. If indications of impairment exist, projected future undiscounted cash flows associated with the asset are compared to the carrying amount to determine whether the asset’s value is recoverable. If the carrying value of the asset exceeds such projected undiscounted cash flows, the asset will be written down to its estimated fair value. Income Taxes The Company provides for income taxes under the asset and liability method. Deferred tax assets and liabilities are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates in effect when the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to reflect the uncertainty associated with their ultimate realization. The Company accounts for uncertain tax positions recognized in the consolidated financial statements in accordance with the provisions of ASC Topic 740, Income Taxes Financing Costs Financing costs include costs directly attributable to the Company’s offerings of its equity securities and its debt financings. Costs attributable to equity offerings are charged as a reduction to stockholders’ equity against the proceeds of the offering once the offering is completed. Costs attributable to debt financings are deferred and amortized to interest expense over the term of the debt using the effective interest method. Costs incurred in connection with convertible debt securities are allocated between the liability and equity components. In accordance with ASC 835, Interest Leases Effective January 1, 2019, the Company adopted ASC Topic 842, Leases optional transition method As part of the ASC 842 adoption, the Company elected certain practical expedients, which include: ● Accounting policy election to use the short-term lease exception by asset class; and ● Election of the practical expedient package during transition, which includes: o An entity need not reassess whether any expired or existing contracts are or contain leases. o An entity need not reassess the classification for any expired or existing leases. As a result, all leases that were classified as operating leases in accordance with ASC 840 are classified as operating leases under ASC 842, and all leases that were classified as capital leases in accordance with ASC 840 are classified as finance leases under ASC 842. o An entity need not reassess initial direct costs for any existing leases. Subsequent to the Company’s adoption of ASC 842, the Company elected the post-transition practical expedient, by class of underlying asset, to account for lease components and non-lease components together as a single component for the asset class of operating lease right-of-use real estate assets. The Company’s lease portfolio for the year ended December 31, 2021 included: a lease for its headquarters location, a data center colocation lease, vehicle leases for its salesforce representatives, and leases for computer and office equipment. The Company determines if an arrangement is a lease at the inception of the contract. The asset component of the Company’s operating leases is recorded as operating lease right-of-use assets, and the liability component is recorded as current portion of operating lease liabilities and operating lease liabilities, net of current portion in the Company’s consolidated balance sheets. As of December 31, 2021, the Company did not record any finance leases. Right-of-use assets and operating lease liabilities are recognized based on the present value of lease payments over the lease term at the lease inception date. Existing leases in the Company’s lease portfolio as of the adoption date were valued as of January 1, 2019. The Company uses an incremental borrowing rate based on the information available at lease inception in determining the present value of lease payments, if an implicit rate of return is not provided with the lease contract. Operating lease right-of-use assets are adjusted for incentives expected to be received. Right-of-use assets and operating lease liabilities are remeasured upon certain modifications to leases using the present value of remaining lease payments and estimated incremental borrowing rate upon lease modification. Lease cost is recognized on a straight-line basis over the lease term, and includes amounts related to short-term leases. The Company recognizes variable lease payments as operating expenses in the period in which the obligation for those payments is incurred. Variable lease payments primarily include common area maintenance, utilities, real estate taxes, insurance, and other operating costs that are passed on from the lessor in proportion to the space leased by the Company. Derivative Assets and Liabilities In June 2015, the Company issued Convertible Senior Notes due 2026 (the “2026 Convertible Notes”, and together with the 2022 Convertible Notes and the 2024 Convertible Notes, the “Convertible Senior Notes”). I Derivatives and Hedging These derivatives are recorded as assets or liabilities at fair value each reporting date and the fair value is determined using the Black-Scholes option-pricing model. The changes in fair value are recorded as a component of other (expense) income in the consolidated statements of income. Significant inputs used to determine the fair value as of December 31, 2021 included the price per share of the Company’s Class A Common Stock, expected terms of the derivative instruments, strike prices of the derivative instruments, risk-free interest rates, and expected volatility of the Company’s Class A Common Stock. Changes to these inputs could materially affect the valuation of the Convertible Note Hedges and Note Hedge Warrants. In August 2019, in connection with the issuance of the 2024 Convertible Notes and the 2026 Convertible Notes, the Company entered into the Capped Calls. The Capped Calls cover the same number of shares of Class A Common Stock that initially underlie the 2024 Convertible Notes and the 2026 Convertible Notes (subject to anti-dilution and certain other adjustments). These instruments meet the conditions outlined in ASC 815 to be classified in stockholders’ equity (deficit) and are not subsequently remeasured as long as the conditions for equity classification continue to be met. Share Repurchases The Company accounts for repurchases of its Class A Common Stock on the trade date by recording the excess of the repurchase price over the par value entirely to additional paid-in capital. All repurchased shares are retired or constructively retired. Issued and outstanding shares are reduced by shares repurchased. Revenue Recognition The Company’s revenues are generated primarily through collaborative arrangements and license agreements related to the research and development and commercialization of linaclotide, as well as co-promotion arrangements in the U.S. The terms of the collaborative research and development, license, co-promotion and other agreements contain multiple performance obligations which may include (i) licenses, (ii) research and development activities, including participation on joint steering committees, (iii) the manufacture of finished drug product, API, or development materials for a partner, which are reimbursed at a contractually determined rate, and (iv) education or co-promotion activities by the Company’s clinical sales specialists. Non-refundable payments to the Company under these agreements may include (i) up-front license fees, (ii) payments for research and development activities, (iii) payments for the manufacture of finished drug product, API, or development materials, (iv) payments based upon the achievement of certain milestones, (v) payments for sales detailing, promotional support services and medical education initiatives, and (vi) royalties on product sales. The Company receives its share of the net profits or bears its share of the net losses from the sale of linaclotide in the U.S. through its collaboration agreement with AbbVie for North America. The Company has adopted a policy to recognize revenue net of tax withholdings, as applicable. Collaboration, License, Co-Promotion and Other Commercial Agreements Upon licensing intellectual property to a customer, the Company determines if the license is distinct from the other performance obligations identified in the arrangement. The Company recognizes revenues from the transaction price, including non-refundable, up-front fees allocated to the license when the license is transferred to the customer if the license has distinct benefit to the customer. For licenses that are combined with other promises, the Company assesses the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time. For performance obligations that are satisfied over time, the Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. The Company’s license and collaboration agreements include milestone payments, such as development and other milestones. The Company evaluates whether the milestones are considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method at the inception of the agreement. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the control of the Company, such as regulatory approvals, are not considered probable of being achieved until those approvals are received. The transaction price is then allocated to each performance obligation on a relative standalone selling price basis, for which the Company recognizes revenue as or when the performance obligations under the contract are satisfied. The Company re-evaluates the probability of achievement of such milestones and any related constraint at each reporting period, and any adjustments are recorded on a cumulative catch-up basis. Agreements that include the supply of API or drug product for either clinical development or commercial supply at the customer’s discretion are generally considered as options. The Company assesses if these options provide a material right to its partner, and if so, they are accounted for as separate performance obligations. If the Company is entitled to additional payments when the customer exercises these options, any additional payments are recorded as revenue when the customer obtains control of the goods, which is typically upon shipment for sales of API and finished drug product. For agreements that include sales-based royalties, including milestone payments based on the level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue when the related sales occur. Net Profit or Net Loss Sharing In accordance with ASC 808 Topic, Collaborative Arrangements Revenue from Contracts with Customers The Company’s collaborative arrangements revenues generated from sales of LINZESS in the U.S. are considered akin to sales-based royalties. In accordance with the sales-based royalty exception, the Company recognizes its share of the pre-tax commercial net profit or net loss generated from the sales of LINZESS in the U.S. in the period the product sales are earned, as reported by AbbVie, and related cost of goods sold and selling, general and administrative expenses as incurred by the Company and AbbVie. These amounts are partially determined based on amounts provided by AbbVie and involve the use of estimates and judgments, such as product sales allowances and accruals related to prompt payment discounts, chargebacks, governmental and contractual rebates, wholesaler fees, product returns, and co-payment assistance costs, which could be adjusted based on actual results in the future. The Company is highly dependent on AbbVie for timely and accurate information regarding net revenues from sales of LINZESS in the U.S. in accordance with both ASC 808 and ASC 606, and the related costs, in order to accurately report its results of operations. If the Company does not receive timely and accurate information or incorrectly estimates activity levels associated with the collaboration at a given point in time, the Company could be required to record adjustments in future periods. In accordance with ASC 606-10-55, Principal Agent Considerations Sale of Active Pharmaceutical Ingredient During the years ended December 31, 2020, and 2019, the Company produced linaclotide API, finished drug product, finished goods, and/or development materials for certain of its partners. As of December 31, 2020, the Company was no longer responsible for the supply of linaclotide API, finished drug product, finished goods or development materials to its partners, though the Company may provide development materials to certain of our partners on a periodic basis. Sales of such development materials have been and are expected to continue to be immaterial. The Company recognizes revenue on linaclotide API, finished drug product, finished goods, and development materials when control has transferred to the partner, which generally occurs upon shipment after the material passed all quality testing required for acceptance by the partner. Prior to the execution of the Amended AstraZeneca Agreement in September 2019, any linaclotide API, finished drug product, and development materials produced for AstraZeneca for China (including Hong Kong and Macau) were recognized in accordance with the cost-sharing provisions of the AstraZeneca collaboration agreement. Other The Company’s deferred revenue balance consists of advance billings and payments received from customers in excess of revenue recognized. Cost of Revenues Cost of revenues includes cost related to the sales of linaclotide API, finished drug product, and finished goods and are generally recognized upon shipment to certain of the Company’s partners outside of the U.S. The Company’s cost of revenues for linaclotide consists of the internal and external costs of producing such API, finished drug product, and finished goods. Research and Development Costs The Company generally expenses research and development costs to operations as incurred. The Company capitalizes nonrefundable advance payments made by the Company for research and development activities and defers expense recognition until the related goods are received or the related services are performed. Research and development expenses are comprised of costs incurred in performing research and development activities, including salary, benefits, share-based compensation, and other employee-related expenses; laboratory supplies and other direct expenses; facilities expenses; overhead expenses; third-party contractual costs relating to nonclinical studies and clinical trial activities and related contract manufacturing expenses, development of manufacturing processes and regulatory registration of third-party manufacturing facilities; licensing fees for the Company’s product candidates; and other outside expenses. The Company has certain collaboration agreements pursuant to which it shares or has shared research and development expenses related to linaclotide. The Company records expenses incurred under such linaclotide collaboration arrangements as research and development expense. Prior to the execution of the Amended AstraZeneca Agreement in September 2019, under the Company’s collaboration agreement with AstraZeneca for China (including Hong Kong and Macau), the Company was reimbursed for certain research and development expenses and it netted these reimbursements against its research and development expenses as incurred. In connection with the execution of the Amended AstraZeneca Agreement, AstraZeneca is fully responsible for all research and development costs incurred related to the development, manufacture, and commercialization of linaclotide in China (including Hong Kong and Macau). Under the Company’s collaboration agreement with AbbVie for North America, the Company is reimbursed for certain research and development expenses and nets these reimbursements against its research and development expenses as incurred. Research and development expense includes up-front payment, non-contingent payment, and milestone payment obligations under the COUR Collaboration Agreement (Note 5). Expense is recognized when the obligation is determined to be probable. Restructuring Expenses Restructuring expenses are comprised primarily of costs associated with exit and disposal activities in accordance with ASC 420, Exit or Disposal Cost Obligations Selling, General and Administrative Expenses The Company expenses selling, general and administrative costs to operations as incurred. Selling, general and administrative expenses consist primarily of compensation, benefits and other employee-related expenses for personnel in the Company’s administrative, finance, legal, information technology, business development, commercial, sales, marketing, communications and human resources functions. Other costs include the legal costs of pursuing patent protection of the Company’s intellectual property, general and administrative related facility costs, insurance costs and professional fees for accounting, tax, consulting, legal and other services. Prior to the execution of the Amended AstraZeneca Agreement, the Company was reimbursed for certain selling, general and administrative expenses and the Company netted these reimbursements against the Company’s selling, general and administrative expenses as incurred. In connection with the Amended AstraZeneca Agreement, effective in September 2019, AstraZeneca is fully responsible for all costs related to the development, manufacture, and commercialization of linaclotide in China (including Hong Kong and Macau). The Company includes AbbVie’s selling, general and administrative cost-sharing payments in the calculation of the net profits and net losses from the sale of LINZESS in the U.S. and presents the net payment to or from AbbVie as collaboration expense or collaborative arrangements revenue, respectively. Share-Based Compensation Expense The Company grants awards under its share-based compensation programs, including stock awards, restricted stock awards (“RSAs”), restricted stock units (“RSUs”) (including both time-based and performance-based RSUs), stock options, and shares issued under the Company’s employee stock purchase plan (“ESPP”). Share-based compensation is recognized as expense in the consolidated statements of income based on the grant date fair value over the requisite service period, net of estimated forfeitures. The Company estimates forfeitures over the requisite service period using historical forfeiture activity and records share-based compensation expense only for those awards that are expected to vest. The Company estimates the fair value of stock options using the Black-Scholes option-pricing model, which requires the use of subjective assumptions including volatility and expected term, among others. The fair value of stock awards, RSAs, and RSUs is based on the market value of the Company’s Class A Common Stock on the date of grant, with the exception of performance-based RSUs with market conditions, which are measured using the Monte Carlo simulation method on the date of grant (Note 13). Discounted stock purchases under the Company’s ESPP are valued on the first date of the offering period using the Black-Scholes option-pricing model to compute the fair value of the lookback provision plus the purchase discount. For awards that vest based on service conditions and market conditions, the Company uses a straight-line method to recognize compensation expense over the respective service period. For awards that contain performance conditions, the Company determines the appropriate amount to expense at each reporting date based on the anticipated achievement of performance targets, which requires judgement, including forecasting the achievement of future specified targets. At the date performance conditions are determined to be probable of achievement, the Company records a cumulative expense catch-up, with remaining expense amortized over the remaining service period. Throughout the performance period, the Company re-assesses the estimated performance and updates the number of performance-based awards that it believes will ultimately vest. Discounted stock purchases under the Company’s ESPP are recognized over the offering period. Compensation expense related to modified awards is measured based on the fair value for the awards as of the modification date. Any incremental compensation expense arising from the excess of the fair value of the awards on the modification date compared to the fair value of the awards immediately before the modification date is recognized at the modification date or ratably over the requisite remaining service period, as appropriate. While the assumptions used to calculate and account for share-based compensation awards represent management’s best estimates, these estimates involve inherent uncertainties and the application of management’s judgment. As a result, if revisions are made to the Company’s underlying assumptions and estimates, the Company’s share-based compensation expense could vary significantly from period to period. Patent Costs The Company incurred and recorded as operating expense legal and other fees related to patents of $1.7 million, $2.3 million, and $7.8 million for the years ended December 31, 2021, 2020 and 2019, respectively. These costs were charged to selling, general and administrative expenses as incurred. Net Income Per Share Basic net income per common share is computed by dividing the net income by the weighted average number of common shares outstanding during the period. Diluted net income per common share is computed by dividing net income by the diluted number of shares outstanding during the period. Except where the result would be antidilutive to net income, diluted net income per common share is computed assuming the conversion of the 2022 Convertible Notes, the 2024 Convertible Notes and the 2026 Convertible Notes, the exercise of outstanding common stock options and the vesting of RSUs and RSAs (using the treasury stock method), as well as their related income tax effects. Subsequent Events The Company considers events or transactions that have occurred after the balance sheet date of December 31, 2021, but prior to the filing of the financial statements with the Securities and Exchange Commission (“SEC”) to provide additional evidence relative to certain estimates or to identify matters that require additional recognition or disclosure. Subsequent events have been evaluated through the filing of the financial statements accompanying this Annual Report on Form 10-K. New Accounting Pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (the “FASB”) or other standard setting bodies that are adopted by the Company as of the specified effective date. Except as set forth below, the Company did not adopt any new accounting pronouncements during the year ended December 31, 2021 that had a material effect on its consolidated financial statements. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes , March 31 , 2021 In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging— Contracts in Entity’s O |
Cyclerion Separation
Cyclerion Separation | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Text Block | |
Cyclerion Separation | 3. Cyclerion Separation On April 1, 2019, Ironwood completed the separation (the “Separation”) of its sGC business, and certain other assets and liabilities, into Cyclerion. The Separation was effected by means of a distribution of all of the outstanding shares of common stock, with no par value, of Cyclerion through a dividend of Cyclerion’s common stock, to the Ironwood’s stockholders of record as of the close of business on March 19, 2019. Prior to the Separation on April 1, 2019, Cyclerion was a wholly owned subsidiary of the Company. On March 30, 2019, the Company entered into certain agreements with Cyclerion relating to the Separation, including a separation agreement, a tax matters agreement, and an employee matters agreement. Agreements with Cyclerion The separation agreement with Cyclerion sets forth, among other things, the Company’s agreements with Cyclerion regarding the principal actions to be taken in connection with the Separation, including the dividend, which was effective as of April 1, 2019. The separation agreement identifies assets transferred, liabilities assumed by and contracts assigned to each of Cyclerion and Ironwood as part of the Separation, and provides for when and how these transfers, assumptions and assignments occur. The purpose of the separation agreement was to provide Cyclerion and Ironwood with assets to operate their respective businesses and retain or assume liabilities related to those assets. The transfer of assets and liabilities to Cyclerion was effected through a contribution in accordance with the separation agreement as summarized below (in thousands): As of April 1, 2019 Assets: Prepaid expenses and other current assets $ 1,169 Property and equipment, net 10,241 Other assets 21 $ 11,431 Liabilities: Accrued research and development costs $ 5,673 Accrued expenses and other current liabilities 3,149 $ 8,822 Net Assets Transferred to Cyclerion $ 2,609 In addition, the Company received $1.3 million during the year ended December 31, 2019 associated with tenant improvement reimbursement provisions related to the Cyclerion lease in accordance with the separation agreement. The tax matters agreement governs each party’s rights, responsibilities and obligations with respect to taxes, including taxes, if any, incurred as a result of any failure of the Separation to qualify as tax-free. In general, if the parties incur tax liabilities in the event that the Separation is not tax-free, each party is expected to be responsible for any taxes imposed on Ironwood or Cyclerion that arise from the failure of the Separation to qualify as a transaction that is generally tax-free for U.S. federal income tax purposes, under Sections 355 and 368(a)(1)(D) and certain other relevant provisions of the Internal Revenue Code of 1986, as amended, to the extent that the failure to so qualify is attributable to an acquisition of stock or assets of, or certain actions, omissions or failures to act of, such party. If both Ironwood and Cyclerion are responsible for such failure, liability will be shared according to relative fault. U.S. tax otherwise resulting from the failure of the Separation to qualify as a transaction that is tax-free generally will be the responsibility of Ironwood. Each party otherwise agreed to indemnify the other party from and against any liability for taxes allocated to such party under the tax matters agreement and any taxes resulting from breach of any such party’s covenants under the tax matters agreement, the separation agreement, or any ancillary agreement entered into in connection with the Separation. Cyclerion agreed to certain covenants that contain restrictions intended to preserve the tax-free status of the distribution and certain related transactions. The employee matters agreement allocates assets, liabilities and responsibilities relating to the employment, compensation, and employee benefits of Ironwood and Cyclerion employees, and other related matters in connection with the Separation, including the treatment of outstanding Ironwood incentive equity awards. Pursuant to the employee matters agreement, the outstanding Ironwood equity awards held by Cyclerion and Ironwood employees were adjusted in connection with the Separation, with the intent to maintain, immediately following the Separation, the economic value of the awards. No incremental stock-based compensation expense related to the Separation-related adjustments was recognized during the year ended December 31, 2019 (Note 13). Additionally, the Company entered into two transition services agreements and a development agreement with Cyclerion. Pursuant to the transition service agreements, the Company was obligated to provide and was entitled to receive certain transition services related to corporate functions, such as finance, procurement, facilities and development. As of December 31, 2020, both transition service agreements had terminated. Amounts received for services provided to Cyclerion were recorded as other income and amounts paid for services provided by Cyclerion were recorded as selling, general and administrative expense and research and development expense, as applicable. During the years ended December 31, 2020 and 2019, the Company recorded an insignificant amount and $0.3 million, respectively, as other income for services provided to Cyclerion. During each of the years ended December 31, 2020 and 2019, the Company recorded an insignificant amount in both selling, general and administrative expense and research and development expense for services provided by Cyclerion, respectively. Pursuant to the development agreement, Cyclerion was obligated to provide the Company with certain research and development services with respect to certain of Ironwood’s products and product candidates for an initial period of two years, unless earlier terminated or extended. As of December 31, 2021, the development agreement had been terminated. Services received were paid at a mutually agreed upon rate and development activities were governed by a joint steering committee comprised of representatives from both Cyclerion and Ironwood. The Company recorded an insignificant amount, $2.3 million and $4.5 million in research and development expenses under the development agreement during the years ended December 31, 2021, 2020 and 2019, respectively. The Company had an insignificant amount of accounts payable due to Cyclerion as of December 31, 2020. Discontinued Operations Upon the Separation, the Company determined its sGC business qualified for discontinued operations accounting treatment in accordance with ASC 205-20. There were no discontinued operations during the years ended December 31, 2021 and 2020. The following is a summary of expenses of Cyclerion classified as discontinued operations for year ended December 31, 2019 (in thousands): Year Ended December 31, 2019 Costs and expenses: Research and development $ 21,792 Selling, general and administrative 15,646 Net loss from discontinued operations $ 37,438 There were no assets or liabilities related to discontinued operations as of either December 31, 2021 or December 31, 2020, as all balances were transferred to Cyclerion upon Separation. |
Net Income Per Share
Net Income Per Share | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Text Block | |
Net Income Per Share | 4. Net Income Per Share The following table sets forth the computation of basic and diluted net income per common share (in thousands, except per share amounts): Year Ended December 31, 2021 2020 2019 Numerator: Net income $ 528,448 $ 106,176 $ 21,505 Denominator: Weighted average number of common shares outstanding used in computing net income per share — basic 162,245 159,427 156,023 Effect of dilutive securities: Stock options 488 367 — Time-based restricted stock units 1,422 766 — Performance-based restricted stock units 146 1 — Restricted stock 117 94 — Dilutive potential common shares Weighted average number of common shares outstanding used in computing net income per share — diluted 164,418 160,655 156,023 Net income per share — basic 3.26 0.67 0.14 Net income per share — diluted $ 3.21 $ 0.66 $ 0.14 The outstanding securities have been excluded from the computation of diluted weighted average shares outstanding, as applicable, as their effect would be anti-dilutive (in thousands): Year Ended December 31, 2021 2020 2019 Stock options 7,701 11,746 17,194 Restricted stock awards — 2 182 Time-based restricted stock units 102 209 3,207 Performance-based restricted stock units 121 93 — Note Hedge Warrants 8,318 8,318 8,318 2022 Convertible Notes 8,318 8,318 8,318 2024 Convertible Notes 14,934 14,934 14,934 2026 Convertible Notes 14,934 14,934 14,934 Total 54,428 58,554 67,087 The potentially dilutive impact of the 2022 Convertible Notes, 2024 Convertible Notes and 2026 Convertible notes (together, the “Convertible Senior Notes”) (Note 10) is determined using the treasury stock method. Under this method, no numerator or denominator adjustments arise from the principal and interest components of the Convertible Senior Notes because the Company has the intent and ability to settle the Convertible Senior Notes’ principal and interest in cash. Instead, the Company is required to increase the diluted net income per share denominator by the variable number of shares that would be issued upon conversion if it settled the conversion spread obligation with shares. For diluted net income per share purposes, the conversion spread obligation is calculated based on whether the average market price of the Company’s Class A Common Stock during the reporting period is in excess of the conversion price of the Convertible Senior Notes. There was no calculated spread added to the denominator for the years ended December 31, 2021, 2020, or 2019. |
Collaboration, License, and Oth
Collaboration, License, and Other Agreements | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Text Block | |
Collaboration, License, and Other Agreements | 5. Collaboration, License, and Other Agreements For the year ended December 31, 2021, the Company had linaclotide collaboration agreements with AbbVie for North America and AstraZeneca for China (including Hong Kong and Macau), as well as linaclotide license agreements with Astellas for Japan and with AbbVie for the AbbVie License Territory. The Company also had an agreement with Alnylam Pharmaceuticals, Inc (“Alnylam”) to perform disease awareness activities for acute hepatic porphyria (“AHP”) and sales detailing activities for GIVLAARI ® Year Ended December 31, Collaborative Arrangements Revenue 2021 2020 2019 Linaclotide Collaboration and License Agreements: AbbVie (North America) $ 403,085 $ 370,902 $ 327,591 AbbVie (Europe and other) 2,558 2,196 1,718 AstraZeneca (China, including Hong Kong and Macau) 743 682 32,628 Astellas (Japan) 2,232 2,128 10,147 Co-Promotion and Other Agreements: AbbVie (VIBERZI) (1) — — 3,723 Alnylam (GIVLAARI) 2,411 4,302 2,000 Other 1,755 1,335 1,845 Total collaborative arrangements revenue $ 412,784 $ 381,545 $ 379,652 Sale of API Linaclotide Agreements: Astellas (Japan) $ 149 $ 2,017 $ 45,788 AstraZeneca (China, including Hong Kong and Macau) 597 5,540 2,973 Other 223 421 — Total sale of API $ 969 $ 7,978 $ 48,761 (1) The Company had an agreement with AbbVie to perform sales detailing activities for VIBERZI® (eluxadoline) which terminated as of December 31, 2019. Accounts receivable, net, included $138.0 million and $145.8 primarily related to collaborative arrangements revenue and sale of API, collectively, as of December 31, 2021 and 2020, respectively. Accounts receivable, net, included $112.2 million and $110.9 million due from the Company’s partner, AbbVie, net of $5.0 million and $4.3 million of accounts payable at December 31, 2021 and 2020, respectively. The Company routinely assesses the creditworthiness of its license and collaboration partners. The Company has not experienced any material losses related to receivables from its license or collaboration partners during the years ended December 31, 2021, 2020, or 2019. Linaclotide Agreements Collaboration Agreement for North America with AbbVie In September 2007, the Company entered into a collaboration agreement with AbbVie to develop and commercialize linaclotide for the treatment of IBS-C, CIC, and other GI conditions in North America. Under the terms of this collaboration agreement, the Company received a non-refundable, upfront licensing fee and shares equally with AbbVie all development costs as well as net profits or losses from the development and sale of linaclotide in the U.S. The Company receives royalties in the mid-teens percent based on net sales in Canada and Mexico. AbbVie is solely responsible for the further development, regulatory approval and commercialization of linaclotide in those countries and funding any costs. The collaboration agreement for North America also includes contingent milestone payments, as well as a contingent equity investment, based on the achievement of specific development and commercial milestones. As of December 31, 2021, $205.0 million in license fees and all six development milestone payments had been received by the Company, as well as a $25.0 million equity investment in the Company’s capital stock. The Company can also achieve up to $80.0 million in a sales-related milestone if certain conditions are met, which will be recognized when the related sales occur. During the years ended December 31, 2021, 2020 and 2019, the Company incurred $8.2 million, $20.1 million, and $37.6 million in total research and development expenses under the linaclotide collaboration for North America. As a result of the research and development cost-sharing provisions of the linaclotide collaboration for North America, the Company incurred $11.5 million and $5.6 million during the years ended December 31, 2021 and December 31, 2020, respectively, and offset $7.2 million in research and development costs during the year ended December 31, 2019, to reflect the obligations of each party under the collaboration to bear 50% of the development costs incurred. The Company and AbbVie began commercializing LINZESS in the U.S. in December 2012. The Company receives 50% of the net profits and bears 50% of the net losses from the commercial sale of LINZESS in the U.S. Net profits or net losses consist of net sales of LINZESS to third-party customers and sublicense income in the U.S. less the cost of goods sold as well as selling, general and administrative expenses. LINZESS net sales are calculated and recorded by AbbVie and may include gross sales net of discounts, rebates, allowances, sales taxes, freight and insurance charges, and other applicable deductions. The Company evaluated its collaboration arrangement for North America with AbbVie and concluded that all development-period performance obligations had been satisfied as of September 2012. However, the Company has determined that there are three remaining commercial-period performance obligations, which include the sales detailing of LINZESS, participation in the joint commercialization committee, and approved additional trials. The consideration remaining includes cost reimbursements in the U.S., as well as commercial sales-based milestones and net profit and loss sharing payments based on net sales in the U.S. Additionally, the Company receives royalties in the mid-teens percent based on net sales in Canada and Mexico. Royalties, commercial sales-based milestones, and net profit and loss sharing payments will be recorded as collaborative arrangements revenue or expense in the period earned, as these payments relate predominately to the license granted to AbbVie. The Company records royalty revenue in the period earned based on royalty reports from its partner, if available, or based on the projected sales and historical trends. The cost reimbursements received from AbbVie during the commercialization period will be recognized as earned in accordance with the right-to-invoice practical expedient, as the Company’s right to consideration corresponds directly with the value of the services transferred during the commercialization period. Under the Company’s collaboration agreement with AbbVie for North America, LINZESS net sales are calculated and recorded by AbbVie and include gross sales net of discounts, rebates, allowances, sales taxes, freight and insurance charges, and other applicable deductions, as noted above. These amounts include the use of estimates and judgments, which could be adjusted based on actual results in the future. The Company records its share of the net profits or net losses from the sales of LINZESS in the U.S. less commercial expenses on a net basis, and presents the settlement payments to and from AbbVie as collaboration expense or collaborative arrangements revenue, as applicable. This treatment is in accordance with the Company’s revenue recognition policy, given that the Company is not the primary obligor and does not have the inventory risks in the collaboration agreement with AbbVie for North America. The Company relies on AbbVie to provide accurate and complete information related to net sales of LINZESS in accordance with U.S. generally accepted accounting principles in order to calculate its settlement payments to and from AbbVie and record collaboration expense or collaborative arrangements revenue, as applicable. The Company recognized collaborative arrangements revenue from the AbbVie collaboration agreement for North America during the years ended December 31, 2021, 2020, and 2019 as follows (in thousands): Year Ended December 31, 2021 2020 2019 Collaborative arrangements revenue related to sales of LINZESS in the U.S. $ 400,371 $ 368,603 $ 325,429 Royalty revenue 2,714 2,299 2,162 Total collaborative arrangements revenue $ 403,085 $ 370,902 $ 327,591 The collaborative arrangements revenue recognized in the years ended December 31, 2021, 2020, and 2019 primarily represents the Company’s share of the net profits and net losses on the sale of LINZESS in the U.S. The Company incurred $30.3 million, $39.9 million, and $40.5 million in total selling, general and administrative costs related to the sale of LINZESS in the U.S. in accordance with the cost-sharing arrangement with AbbVie, which included $0.3 million, $0.6 million, and $2.4 million in patent prosecution and patent litigation costs, for the years ended December 31, 2021, 2020, and 2019, respectively. In May 2014, CONSTELLA ® License Agreement with AbbVie (All countries other than the countries and territories of North America, China (including Hong Kong and Macau), and Japan) In April 2009, the Company entered into a license agreement with Almirall, S.A. (“Almirall”) to develop and commercialize linaclotide in Europe (including the Commonwealth of Independent States and Turkey) for the treatment of IBS-C, CIC and other GI conditions (the “European License Agreement”). In accordance with the European License Agreement, the Company granted Almirall a right to access its U.S. Phase III clinical trial data for the purposes of supporting European regulatory approval. In October 2015, Almirall transferred its exclusive license to develop and commercialize linaclotide in Europe to AbbVie. Additionally, in October 2015, the Company and AbbVie separately entered into an amendment to the European License Agreement relating to the development and commercialization of linaclotide in Europe. Pursuant to the terms of the amendment, (i) certain sales-based milestones payable to the Company under the European License Agreement were modified to increase the total milestone payments such that, when aggregated with certain commercial launch milestones, they could total up to $42.5 million, (ii) the royalties payable to the Company during the term of the European License Agreement were modified such that the royalties based on sales volume in Europe begin in the mid-single digit percent and escalate to the upper-teens percent by calendar year 2019, and (iii) AbbVie assumed responsibility for the manufacturing of linaclotide API for Europe from the Company, as well as the associated costs. The Company concluded that the 2015 amendment to the European License Agreement was not a modification to the linaclotide collaboration agreement with AbbVie for North America. In January 2017, the Company and AbbVie entered into an amendment to the European License Agreement (the “2017 Amendment”). The 2017 Amendment extended the license to develop and commercialize linaclotide in all countries other than China (including Hong Kong and Macau), Japan, and the countries and territories of North America. On a country-by-country and product-by-product basis in such additional territory, AbbVie is obligated to pay the Company a royalty as a percentage of net sales of products containing linaclotide as an active ingredient in the upper-single digits for five years following the first commercial sale of a linaclotide product in a country, and in the low-double digits thereafter. The royalty rate for products in the expanded territory will decrease, on a country-by-country basis, to the lower-single digits, or cease entirely, following the occurrence of certain events. The 2017 Amendment did not modify any of the milestones or royalty terms related to Europe. In evaluating the terms of the European License Agreement, as amended by the 2017 Amendment (the “Amended European License Agreement”), the Company determined that there are no remaining performance obligations as of September 2012. However, the Company continues to be eligible to receive consideration in the form of commercial launch milestones, sales-based milestones, and royalties. The commercial launch milestones, sales-based milestones and royalties under the Amended European License Agreement relate predominantly to the license granted to AbbVie. The Company records royalties on sales of CONSTELLA in Europe in the period earned based on royalty reports from its partner, if available, or the projected sales and historical trends under the sales-based royalty exception. The commercial launch milestones are recognized as revenue when it is probable that a significant reversal of revenue would not occur and the associated constraint has been lifted. The Company recognized $2.6 million, $2.2 million and $1.7 million of royalty revenue from the Amended European License Agreement during the years ended December 31, 2021, 2020, and 2019, respectively. License Agreement for Japan with Astellas In November 2009, the Company entered into a license agreement with Astellas, as amended, to develop and commercialize linaclotide for the treatment of IBS-C, CIC and other GI conditions in Japan (the “2009 License Agreement with Astellas”). Astellas is responsible for all activities relating to development, regulatory approval and commercialization in Japan as well as funding the associated costs and the Company was required to participate on a joint development committee over linaclotide’s development period. Under the 2009 License Agreement with Astellas, the Company received an upfront licensing fee of $30.0 million and three development milestone payments that totaled $45.0 million and has no remaining performance obligations. In April 2017, the Company and Astellas entered into a commercial API supply agreement (the “Astellas Commercial Supply Agreement”). Pursuant to the Astellas Commercial Supply Agreement, the Company sold linaclotide API supply to Astellas at a contractually defined rate and recognized related revenue as sale of API. Under the 2009 License Agreement with Astellas, the Company received royalties which escalated based on sales volume, beginning in the low-twenties percent, less the transfer price paid for the API included in the product sold and other contractual deductions. During the year ended December 31, 2019, the Company recognized revenue of $27.5 million from the sale of API to Astellas under the 2009 License Agreement with Astellas and the Astellas Commercial Supply Agreement. The royalties on sales of LINZESS in Japan did not exceed the transfer price of API sold and other contractual deductions during each of the periods presented. In August 2019, the Company and Astellas amended and restated the 2009 License Agreement with Astellas (the “Amended Astellas License Agreement”). This amendment to the 2009 License Agreement with Astellas was accounted for as a separate contract. Under the terms of the Amended Astellas License Agreement, the Company is no longer responsible for the supply of linaclotide API to Astellas, and Astellas assumed responsibility for its own supply of linaclotide API in Japan in 2020, other than minimal quantities of API the Company supplied to Astellas in 2020 relating to orders for linaclotide API placed by Astellas in 2019. In connection with the execution of the Amended Astellas License Agreement, Astellas paid the Company a non-refundable, upfront payment of $10.0 million in August 2019. Further, Astellas, in lieu of the royalty payment terms set forth in the 2009 License Agreement with Astellas, is required to pay royalties to the Company at rates beginning in the mid-single digit percent and escalating to low-double-digit percent, based on aggregate annual net sales in Japan of products containing linaclotide API. These royalty payments are subject to reduction following the expiration of certain licensed patents and the occurrence of generic competition in Japan. The Company continued to supply linaclotide API for Japan during 2019 and 2020 at a contractually defined rate. Additionally, Astellas reimbursed the Company for the Company’s performance of adverse event reporting services at a fixed monthly rate until such services were terminated in February 2020. The Company identified the following performance obligations under the Amended Astellas License Agreement: ● delivery of the expanded license of intellectual property, including the applicable manufacturing know-how; ● obligation to supply linaclotide API for 2019; and ● adverse event reporting services. The Company allocated the $10.0 million upfront payment to the delivery of the expanded license of intellectual property and recognized it as collaborative arrangements revenue at contract inception. The Company allocated the $20.4 million in remaining purchase orders for API to the obligation to supply linaclotide API to Astellas for 2019. Consideration for the supply of linaclotide API was recognized over the performance period as linaclotide API is shipped to Astellas. Consideration allocated to the adverse event reporting services was recognized as such services were provided over the performance period based on the amount to which the Company has a right to invoice. Royalties on sales of LINZESS in Japan relate predominantly to the license granted to Astellas. Accordingly, the Company applies the sales-based royalty exception and records royalties on sales of LINZESS in Japan in the period earned based on royalty reports from its partner, if available, or the projected sales and historical trends. During the year ended December 31, 2021, the Company recognized $2.2 million in collaborative arrangements revenue related to royalties and $0.2 million related to the sale of API to Astellas under the Amended Astellas License Agreement. During the year ended December 31, 2020, the Company recognized $2.1 million in collaborative arrangements revenue related to royalties, an insignificant amount of collaborative arrangements revenue related to adverse event reporting services, and $2.0 million from the sale of API to Astellas under the Amended Astellas License Agreement. During the year ended December 31, 2019, the Company recognized $10.0 million in collaborative arrangements revenue related to the upfront fee associated with the execution of the Amended Astellas License Agreement, an insignificant amount of collaborative arrangements revenue related to adverse event reporting services, and $18.3 million from the sale of API to Astellas under the Amended License Agreement. Collaboration Agreement for China (including Hong Kong and Macau) with AstraZeneca In October 2012, the Company entered into a collaboration agreement with AstraZeneca to co-develop and co-commercialize linaclotide in the AstraZeneca License Territory (the “AstraZeneca Collaboration Agreement”). The collaboration provided AstraZeneca with an exclusive nontransferable license to exploit the underlying technology in the AstraZeneca License Territory. The parties shared responsibility for continued development and commercialization of linaclotide under a joint development plan and a joint commercialization plan, respectively, with AstraZeneca having primary responsibility for the local operational execution. In September 2019, the Company and AstraZeneca entered into an amendment and restatement of the AstraZeneca Collaboration Agreement (the “Amended AstraZeneca Agreement”) under which AstraZeneca obtained the exclusive right to develop, manufacture and commercialize products containing linaclotide in the AstraZeneca License Territory (the “AstraZeneca License”). Prior to the execution of the Amended AstraZeneca Agreement, the Company identified the following performance obligations under the AstraZeneca Collaboration Agreement: ● research, development and regulatory services pursuant to the development plan (“R&D Services”); ● Joint Development Committee (“JDC”) services; ● obligation to supply clinical trial material; and ● Joint Commercialization Committee services. Under the original AstraZeneca Collaboration Agreement, the Company shared development costs with AstraZeneca, with AstraZeneca incurring 55% of the net losses from the development and commercialization of linaclotide in the AstraZeneca License Territory. Payments from AstraZeneca with respect to both research and development and selling, general and administrative costs incurred by the Company prior to the commercialization of linaclotide in the AstraZeneca License Territory were recorded as a reduction in expense. Development costs incurred by the Company that pertained to the joint development plan and subsequent amendments to the joint development plan, as approved by the JDC, were recorded as research and development expense as incurred. Payments to AstraZeneca were recorded as incremental research and development expense. During the years ended December 31, 2019, the Company incurred $1.2 million related to pre-launch commercial services and supply chain services. Under the Amended AstraZeneca Agreement, the Company is entitled to receive non-contingent payments totaling $35.0 million in three installments through 2024, of which $10.0 million was received in January 2021. In addition, AstraZeneca may be required to make milestone payments totaling up to $90.0 million contingent on the achievement of certain sales targets and will be required to pay tiered royalties to the Company at rates beginning in the mid-single-digit percent and increasing up to twenty percent based on the aggregate annual net sales of products containing linaclotide in the AstraZeneca License Territory. In connection with the Amended AstraZeneca Agreement, the Company and AstraZeneca entered into a transition services agreement (“AstraZeneca TSA”) and an amended commercial supply agreement (“AstraZeneca CSA”). Under the terms of the AstraZeneca TSA, the Company provided certain regulatory and administrative services through September 2021. Services performed were paid at a mutually agreed upon rate. Amounts for AstraZeneca TSA services were recorded as collaborative arrangements revenue. Under the terms of the AstraZeneca CSA, the Company supplied linaclotide API, finished drug product and finished goods for the Licensed Territory through March 31, 2020 at predetermined rates. The Company evaluated the Amended AstraZeneca Agreement and determined that it would be accounted for as a separate contract because it adds a distinct good or service at an amount that reflects standalone selling price. The following performance obligations under the Amended AstraZeneca Agreement were identified: ● delivery of the expanded AstraZeneca License; ● AstraZeneca TSA services; and ● supply of linaclotide API, finished drug product and finished goods under the AstraZeneca CSA. The Company determined that the non-contingent payments should be allocated to the delivery of the expanded AstraZeneca License. The Company determined that the performance obligation related to the transfer of the AstraZeneca License was satisfied as of the execution date of the Amended AstraZeneca Agreement. As a portion of the payments relating to the transfer of the AstraZeneca License are due significantly after the performance obligation was satisfied, the Company adjusted its transaction price for the significant financing component of $2.6 million. Accordingly, the Company recognized $32.4 million in 2019 relating to the delivery of the AstraZeneca License as collaborative arrangements revenue at contract inception and is recognizing the $2.6 million relating to the significant financing component as interest income through 2024 using the effective interest method. Consideration allocated to the AstraZeneca TSA services was recognized as collaborative arrangements revenue as such services are provided over the performance period based on the amount to which the Company has a right to invoice. Consideration for the supply of linaclotide API, finished drug product and finished goods under the AstraZeneca CSA was recognized over the performance period as linaclotide API, finished drug product and finished goods were shipped to AstraZeneca. During the year ended December 31, 2021, the Company recognized $0.7 million in collaborative arrangements revenue related to the Amended AstraZeneca Agreement, of which $0.5 million related to royalties and $0.2 million related to AstraZeneca TSA services, and recognized During the year ended December 31, 2020, the Company recognized arrangements revenue related to the Amended AstraZeneca License, of which $0.6 million related to the AstraZeneca TSA services and $0.1 million related to royalties, and recognized $5.5 million of sales of API relating to the supply of linaclotide finished drug product and finished goods under the AstraZeneca CSA. The Company recognized $0.8 million in interest income related to the significant financing component of the Amended AstraZeneca Agreement during the year ended December 31, 2020. During the year ended December 31, 2019, the Company recognized $32.6 million in collaborative arrangements revenue related to the Amended AstraZeneca License, of which $32.4 million related to the delivery of the AstraZeneca License and $0.2 million related to the AstraZeneca TSA services, and recognized $3.0 million of sale of API relating to the supply of linaclotide finished drug product and finished goods under the AstraZeneca CSA. The Company recognized $0.2 million in interest income related to the significant financing component of the Amended AstraZeneca Agreement during the year ended December 31, 2019. Other Collaboration and License Agreements Collaboration and License Option Agreement with Cour Pursuant to the terms of the COUR Collaboration Agreement, the Company made an upfront, non-refundable payment of $6.0 million to COUR during the year ended December 31, 2021, and will pay COUR non-contingent payments and milestone payments totaling $13.5 million in connection with certain development activities and regulatory milestones. After reviewing the data from the Initial Study, if the Company exercises the Option, the Company will pay COUR $35.0 million in exchange for the license. Upon commercialization, COUR will be eligible to receive commercial milestone payments of up to $440.0 million over the term of the agreement and royalties in the high single digits to low double digits percentage of the aggregated annual net sales in the U.S. of products containing CNP-104. Other Agreements Disease Education and Promotional Agreement with Alnylam In August 2019, the Company and Alnylam entered into a disease education and promotional agreement (the “Alnylam Agreement”) for Alnylam’s GIVLAARI for the treatment of AHP. The Alnylam Agreement, as amended, was terminated in June 2021 with an effective termination date of September 30, 2021. Under the terms of the Alnylam Agreement, the Company’s sales force performed disease awareness activities and sales detailing activities for GIVLAARI to gastroenterologists and health care practitioners to whom they detail LINZESS in the first position over the term of the agreement. Pursuant to the terms of the Alnylam Agreement, the Company received service fees, totaling ● performance of disease education activities for AHP and performance of sales details for GIVLAARI (together “Givosiran Education and Promotion Activities”). The Company allocated the service fees to the performance of Givosiran Education and Promotion Activities and recognized collaborative arrangements revenue through December 31, 2020 as the services were performed based on the amount to which the Company had a right to invoice. Royalties are recognized as collaborative arrangements revenue for Givosiran Education and Promotion Activities based on the amount to which the Company has a right to invoice when the associated constraints have been lifted. During the years ended December 31, 2021 and 2020, the Company recognized $2.4 million and $0.8 million, respectively, in collaborative arrangements revenue related to royalties. During the years ended December 31, 2020 and 2019, the Company recognized $3.5 million and $2.0 million, respectively, in collaborative arrangements revenue related to the service fees. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Text Block | |
Fair Value of Financial Instruments | 6. Fair Value of Financial Instruments The tables below present information about the Company’s assets that are measured at fair value on a recurring basis as of December 31, 2021 and 2020 and indicate the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value. In general, fair values determined by Level 1 inputs utilize observable inputs such as quoted prices in active markets for identical assets or liabilities. Fair values determined by Level 2 inputs utilize data points that are either directly or indirectly observable, such as quoted prices for similar instruments in active markets, interest rates and yield curves. Fair values determined by Level 3 inputs utilize unobservable data points in which there is little or no market data, which require the Company to develop its own assumptions for the asset or liability. The Company’s investment portfolio may include fixed income securities that do not always trade on a daily basis. As a result, the pricing services used by the Company apply other available information as applicable through processes such as benchmark yields, benchmarking of like securities, sector groupings and matrix pricing to prepare valuations. In addition, model processes are used to assess interest rate impact and develop prepayment scenarios. These models take into consideration relevant credit information, perceived market movements, sector news and economic events. The inputs into these models may include benchmark yields, reported trades, broker-dealer quotes, issuer spreads and other relevant data. The Company validates the prices provided by its third party pricing services by obtaining market values from other pricing sources and analyzing pricing data in certain instances. The Company periodically invests in certain reverse repurchase agreements, which are collateralized by Government Securities and Obligations for an amount not less than 102% of their principal amount. The Company does not record an asset or liability for the collateral as the Company is not permitted to sell or re-pledge the collateral. The collateral has at least the prevailing credit rating of U.S. Government Treasuries and Agencies. The Company utilizes a third party custodian to manage the exchange of funds and ensure the collateral received is maintained at 102% of the reverse repurchase agreements principal amount on a daily basis. The following tables present the assets and liabilities the Company has measured at fair value on a recurring basis (in thousands): Fair Value Measurements at Reporting Date Using Quoted Prices in Significant Other Significant Active Markets for Observable Unobservable December 31, Identical Assets Inputs Inputs 2021 (Level 1) (Level 2) (Level 3) Assets: Cash and cash equivalents: Money market funds $ 595,233 $ 595,233 $ — $ — Restricted cash: Money market funds 1,735 1,735 — — Convertible note hedges 1,115 — — 1,115 Total assets measured at fair value $ 598,083 $ 596,968 $ — $ 1,115 Liabilities: Note hedge warrants $ 1,316 $ — $ — $ 1,316 Total liabilities measured at fair value $ 1,316 $ — $ — $ 1,316 Fair Value Measurements at Reporting Date Using Quoted Prices in Significant Other Significant Active Markets for Observable Unobservable December 31, Identical Assets Inputs Inputs 2020 (Level 1) (Level 2) (Level 3) Assets: Cash and cash equivalents: Money market funds $ 349,014 $ 349,014 $ — $ — Restricted cash: Money market funds 2,221 2,221 — — Convertible note hedges 13,065 — — 13,065 Total assets measured at fair value $ 364,300 $ 351,235 $ — $ 13,065 Liabilities: Note hedge warrants $ 12,088 $ — $ — $ 12,088 Total liabilities measured at fair value $ 12,088 $ — $ — $ 12,088 There were no transfers between fair value measurement levels during each of the years ended December 31, 2021, 2020, and 2019. Cash equivalents, accounts receivable, prepaid expenses and other current assets, accounts payable, accrued research and development costs, accrued expenses and other current liabilities and current portion of operating lease obligations at December 31, 2021 and 2020 are carried at amounts that approximate fair value due to their short-term maturities. Convertible Note Hedges and Note Hedge Warrants with Respect to 2022 Convertible Notes The Company’s Convertible Note Hedges and the Note Hedge Warrants are recorded as derivative assets and liabilities, respectively, and are classified as Level 3 measurements under the fair value hierarchy. These derivatives are not actively traded and are valued using the Black-Scholes option-pricing model, which requires the use of subjective assumptions. The following inputs were used in the fair market valuation of the Convertible Note Hedges and Note Hedge Warrants as of December 31, 2021 and 2020: Year Ended Year Ended December 31, 2021 December 31, 2020 Convertible Note Hedge Convertible Note Hedge Note Hedges Warrants Note Hedges Warrants Risk-free interest rate (1) 0.2 % 0.4 % 0.1 % 0.1 % Expected term 0.5 1.0 1.5 2.0 Stock price (2) $ 11.66 $ 11.66 $ 11.39 $ 11.39 Strike price (3) $ 14.51 $ 18.82 $ 14.51 $ 18.82 Common stock volatility (4) 27.0 % 32.2 % 46.7 % 50.3 % Dividend yield (5) — % — % — % — % (1) Based on U.S. Treasury yield curve, with terms commensurate with the expected terms of the Convertible Note Hedges and the Note Hedge Warrants. (2) The closing price of the Company’s Class A Common Stock on the last trading days of the years ended December 31, 2021 and 2020, respectively. (3) As per the respective agreements for the Convertible Note Hedges and Note Hedge Warrants. (4) Expected volatility based on historical volatility of the Company’s Class A Common Stock. (5) The Company has not paid and does not anticipate paying cash dividends on its shares of common stock in the foreseeable future; therefore, the expected dividend yield is assumed to be zero . The Convertible Note Hedges and the Note Hedge Warrants are recorded at fair value at each reporting date and changes in fair value are recorded in other (expense) income, net within the Company's consolidated statements of income. The following table reflects the change in the Company's Level 3 Convertible Note Hedges and Note Hedge Warrants from December 31, 2019 through December 31, 2021 (in thousands): Convertible Note Hedge Note Hedges Warrants Balance at December 31, 2019 $ 31,366 $ (24,260) Change in fair value, recorded as a component of (loss) gain on derivatives (18,301) 12,172 Balance at December 31, 2020 $ 13,065 $ (12,088) Change in fair value, recorded as a component of (loss) gain on derivatives (11,950) 10,772 Balance at December 31, 2021 $ 1,115 $ (1,316) Convertible Senior Notes In June 2015, the Company issued $335.7 million aggregate principal amount of its 2022 Convertible Notes. In August 2019, the Company issued $200.0 million aggregate principal amount of its 2024 Convertible Notes and $200.0 million aggregate principal amount of its 2026 Convertible Notes, and used a portion of the proceeds from such issuances to repurchase $215.0 million aggregate principal amount of its 2022 Convertible Notes. The Company separately accounted for the liability and equity components of each of the 2022 Convertible Notes, 2024 Convertible Notes, and 2026 Convertible Notes, by allocating the proceeds between the liability component and equity component (Note 10). The fair value of the respective convertible senior notes, which differs from their carrying value, is influenced by interest rates, the price of the Company’s Class A Common Stock and the volatility thereof, and the prices for the respective convertible senior notes observed in market trading, which are Level 2 inputs. The estimated fair value of the 2022 Convertible Notes was $125.2 million and $130.2 million as of December 31, 2021 and 2020, respectively. The estimated fair value of the 2024 Convertible Notes was $221.9 million and $222.3 million as of December 31, 2021 and 2020, respectively. The estimated fair value of the 2026 Convertible Notes was $227.2 million and $224.1 million as of December 31, 2021 and 2020, respectively. Capped Calls with Respect to 2024 Convertible Notes and 2026 Convertible Notes In connection with the issuance of the 2024 Convertible Notes and the 2026 Convertible Notes, the Company entered into the Capped Calls with certain financial institutions. The Capped Calls cover 29,867,480 shares of Class A Common Stock (subject to anti-dilution and certain other adjustments), which is the same number of shares of Class A Common Stock that initially underlie the 2024 Convertible Notes and the 2026 Convertible Notes. The Capped Calls have an initial strike price of approximately $13.39 per share, which corresponds to the initial conversion price of the 2024 Convertible Notes and the 2026 Convertible Notes, and have a cap price of approximately $17.05 per share (Note 10). The strike price and cap price are subject to anti-dilution adjustments generally similar to those applicable to the 2024 Convertible Notes and the 2026 Convertible Notes. These instruments meet the conditions outlined in ASC 815, to be classified in stockholders’ equity (deficit) and are not subsequently remeasured as long as the conditions for equity classification continue to be met (Note 10). |
Leases
Leases | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Text Block | |
Leases | 7. Leases Effective January 1, 2019, the Company adopted ASC 842 using the optional transition method The Company’s office lease and vehicle lease require letters of credit to secure the Company’s obligations under the lease agreements totaling Lease cost is recognized on a straight-line basis over the lease term. The components of lease cost for the years ended December 31, 2021, 2020 and 2019 are as follows (in thousands): Year Ended December 31, 2021 2020 2019 Operating lease cost (1) $ 2,520 $ 2,530 $ 16,452 Variable lease payments — — 1,526 Short-term lease cost 960 1,420 1,512 Total lease cost $ 3,480 $ 3,950 $ 19,490 (1) Operating lease cost is presented net of $0.3 million of sublease income for the year ended December 31, 2019 related to a sublease agreement between Ironwood and Cyclerion executed upon Separation. The sublease agreement terminated in May 2019. Supplemental information related to leases for the periods reported is as follows: Year Ended December 31, 2021 2020 2019 Right-of-use assets obtained in exchange for new operating lease upon adoption of ASC 842 (in thousands) $ — $ — $ 88,299 Adjustment to right-of-use assets as a result of the lease modification upon Separation (in thousands) — — (40,427) Adjustment to right-of-use assets as a result of the termination of the Binney Street Lease (in thousands) — — (34,440) Right-of-use assets obtained in exchange for new operating lease liabilities upon execution of Summer Street Lease (in thousands) — — 18,452 Cash paid for amounts included in the measurement of lease liabilities (in thousands) $ 3,128 $ 1,146 $ 18,598 Weighted-average remaining lease term of operating leases (in years) 8.3 9.3 10.2 Weighted-average discount rate of operating leases 5.8 % 5.8 % 5.8 % Future minimum lease payments under non-cancelable operating leases as of December 31, 2021 are as follows (in thousands): 2022 $ 3,129 2023 3,065 2024 3,126 2025 3,189 2026 3,252 2027 and thereafter 11,603 Total future minimum lease payments 27,364 Less: present value adjustment (5,753) Operating lease liabilities 21,611 Less: current portion of operating lease liabilities (3,127) Operating lease liabilities, net of current portion $ 18,484 Summer Street Lease (current headquarters) In June 2019, the Company entered into a non-cancelable operating lease (the “Summer Street Lease”) for approximately 39,000 square feet of office space on the 23 rd At lease inception, the Company recorded a right-of-use asset and a lease liability using an incremental borrowing rate of 5.8%. At December 31, 2021, the balances of the right-of-use asset and operating lease liability were $15.3 million and $21.5 million, respectively. At December 31, 2020, the balances of the right-of-use asset and operating lease liability were $16.6 million and $23.2 million, respectively. Lease costs related to the Summer Street Lease recorded during the years ended December 31, 2021, 2020 and 2019 were $2.5 million, $2.5 million and $1.5 million, respectively. Binney Street Lease (prior headquarters) The Company rented office space at 301 Binney Street, Cambridge, Massachusetts under a non-cancelable operating lease entered into in January 2007, as amended (“Binney Street Lease”) through October 2019. On April 1, 2019, the Company modified the Binney Street Lease to reduce its leased premises to approximately 108,000 rentable square feet of office space on the first and third floors. The surrendered portion of approximately 114,000 rentable square feet on the first and second floor of the building was subsequently occupied by Cyclerion under a direct lease between Cyclerion and the Binney Street landlord. As a result of the modification, the Company adjusted the value of its right-of-use asset and operating lease liability using an incremental borrowing rate of approximately 5.1%, and recognized a gain of approximately $3.2 million, which was recorded as a reduction to operating expenses on its consolidated statement of operations. The Company elected to determine the proportionate reduction in the right-of-use asset based on the reduction to the lease liability. As of January 1, 2019, in conjunction with the adoption of ASC 842, the Company recorded a right-of-use asset of approximately $87.7 million and a lease liability of approximately $94.3 million associated with the Binney Street Lease. On June 11, 2019, the Company entered into a lease termination agreement (the “Lease Termination”) with the Binney Street landlord to terminate the Company’s lease for approximately 108,000 square feet of office space. The Lease Termination was effective during the fourth quarter of 2019 in exchange for an approximately $9.0 million payment. The Lease Termination was accounted for as a lease modification that reduces the term of the existing lease and the Company adjusted the value of its right-of-use asset and operating lease liability using an incremental borrowing rate of approximately 4.0%. Lease cost related to the Binney Street Lease recorded during the year ended December 31, 2019 was approximately $16.3 million, net of sublease income of approximately $0.3 million. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Text Block | |
Property and Equipment | 8. Property and Equipment Property and equipment, net consisted of the following (in thousands): December 31, 2021 2020 Software $ 5,667 $ 8,615 Leasehold improvements 7,407 7,407 Laboratory equipment 1,327 1,898 Furniture and fixtures 1,517 1,517 Computer and office equipment 1,285 1,297 Total property and equipment 17,203 20,734 Less accumulated depreciation and amortization (9,628) (11,805) Total property and equipment, net $ 7,575 $ 8,929 Depreciation expense of property and equipment was $1.5 million, $2.3 million and $5.6 million for the years ended December 31, 2021, 2020 and 2019, respectively. During the year ended December 31, 2020, the Company recorded $1.2 million, in restructuring expenses in its consolidated statement of income related to the impairment of certain fixed assets as a result of its decision to discontinue IW-3718 development. |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Text Block | |
Accrued Expenses and Other Current Liabilities | 9. Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following (in thousands): December 31, 2021 2020 Accrued compensation and benefits $ 16,653 13,413 Restructuring liabilities 462 10,510 Stock repurchase 3,009 — Other 3,442 2,563 Total accrued expenses and other current liabilities $ 23,566 $ 26,486 As of December 31, 2021, other accrued expenses of $3.4 million included $2.7 million of uninvoiced vendor liabilities, $0.3 million of accrued interest and $0.2 million of state income taxes payable. As of December 31, 2020, other accrued expenses of $2.6 million included $2.1 million of uninvoiced vendor liabilities and $0.3 million of accrued interest. |
Notes Payable
Notes Payable | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Text Block | |
Notes Payable | 10. Notes Payable 2.25% Convertible Senior Notes due 2022 In June 2015, the Company issued $335.7 million aggregate principal amount of the 2022 Convertible Notes. The Company received net proceeds of $324.0 million from the sale of the 2022 Convertible Notes, after deducting fees and expenses of $11.7 million. The Company used $21.1 million of the net proceeds from the sale of the 2022 Convertible Notes to pay the net cost of the Convertible Note Hedges (after such cost was partially offset by the proceeds to the Company from the sale of the Note Hedge Warrants), as described below. The 2022 Convertible Notes are governed by an indenture (the “2022 Indenture”) between the Company and U.S. Bank National Association, as trustee (the “Trustee”). The 2022 Convertible Notes are senior unsecured obligations and bear cash interest at the annual rate of 2.25%, payable on June 15 and December 15 of each year. The 2022 Convertible Notes will mature on June 15, 2022, unless earlier converted or repurchased. The Company held the option to determine settlement method through payment or delivery, as the case may be, of cash, shares of the Company’s Class A Common Stock, or a combination of cash and shares of Class A Common Stock (subject to, and in accordance with, the settlement provisions of the 2022 Indenture). The Company has elected to settle conversions of the 2022 Convertible Notes through cash payment equal to the principal value and shares of Class A Common Stock for the conversion premium, if any. The initial conversion rate for the 2022 Convertible Notes was 60.3209 shares of Class A Common Stock (subject to adjustment as provided for in the 2022 Indenture) per $1,000 principal amount of the 2022 Convertible Notes, which was equal to an initial conversion price of approximately $16.58 per share and 20,249,665 shares. In connection with the Separation, in April 2019, the conversion rate under the 2022 Indenture was adjusted to equal 68.9172 shares of Class A Common Stock per $1,000 principal amount of the 2022 Convertible Notes, which is equal to an adjusted conversion price of approximately $14.51 per share and 23,135,435 shares. Holders of the 2022 Convertible Notes had the right to convert their 2022 Convertible Notes at their option at any time prior to the close of business on the business day immediately preceding December 15, 2021 upon the occurrence of certain circumstances and no such conversions occurred. On or after December 15, 2021, until the close of business on the second scheduled trading day immediately preceding June 15, 2022, holders may convert their 2022 Convertible Notes, in multiples of $1,000 principal amount, at the option of the holder. Upon the occurrence of certain fundamental changes, as described in the 2022 Indenture, holders of the 2022 Convertible Notes may require the Company to repurchase for cash all or part of their 2022 Convertible Notes at a repurchase price equal to 100% of the principal amount of the 2022 Convertible Notes to be repurchased, plus accrued and unpaid interest. If a make-whole fundamental change, as described in the 2022 Indenture, occurs and a holder elects to convert its 2022 Convertible Notes in connection with such make-whole fundamental change, such holder may be entitled to an increase in the conversion rate as described in the 2022 Indenture. The 2022 Indenture does not contain any financial covenants or restrict the Company’s ability to repurchase the Company’s securities, pay dividends or make restricted payments in the event of a transaction that substantially increases the Company’s level of indebtedness. The 2022 Indenture provides for customary events of default. In the case of an event of default with respect to the 2022 Convertible Notes arising from specified events of bankruptcy or insolvency, all outstanding 2022 Convertible Notes will become due and payable immediately without further action or notice. If any other event of default with respect to the 2022 Convertible Notes under the 2022 Indenture occurs or is continuing, the Trustee or holders of at least 25% in aggregate principal amount of the then outstanding 2022 Convertible Notes may declare the principal amount of the 2022 Convertible Notes to be immediately due and payable. Notwithstanding the foregoing, the 2022 Indenture provides that, upon the Company’s election, and for up to 180 days, the sole remedy for an event of default relating to certain failures by the Company to comply with certain reporting covenants in the 2022 Indenture consists exclusively of the right to receive additional interest on the 2022 Convertible Notes. In accordance with accounting guidance for debt with conversion and other options, the Company separately accounted for the liability and equity components of the 2022 Convertible Notes by allocating the proceeds between the liability component and the embedded conversion option, or equity component, due to the Company's ability to settle the 2022 Convertible Notes in cash, its Class A Common Stock, or a combination of cash and Class A Common Stock at the option of the Company. The carrying amount of the liability component was calculated by measuring the fair value of a similar liability that does not have an associated conversion feature. The equity component of the 2022 Convertible Notes was recognized as a debt discount and represents the difference between the gross proceeds from the issuance of the 2022 Convertible Notes and the fair value of the liability component of the 2022 Convertible Notes on their respective dates of issuance. The debt discount is amortized to interest expense using the effective interest method over seven years, or the expected life of the 2022 Convertible Notes. The equity component is not remeasured as long as it continues to meet the conditions for equity classification. In connection with the issuance of the 2024 Convertible Notes and the 2026 Convertible Notes in August 2019, the Company repurchased $215.0 million aggregate principal amount of the 2022 Convertible Notes. The 2022 Convertible Notes were repurchased at a premium totaling $227.3 million. The Company recognized a loss on extinguishment of debt of $23.4 million during the year ended December 31, 2019 related to the prepayment premium and proportional write-off of the 2022 Convertible Notes unamortized debt issuance costs and unamortized debt discount. Additionally, the repurchase resulted in a reduction to additional paid-in capital of $27.0 million during the year ended December 31, 2019 related to the equity component of the 2022 Convertible Notes. 0.75% Convertible Senior Notes due 2024 and 1.50% Convertible Senior Notes due 2026 In August 2019, the Company issued $200.0 million aggregate principal amount of the 2024 Convertible Notes and $200.0 million aggregate principal amount of the 2026 Convertible Notes. The Company received net proceeds of $391.0 million from the sale of the 2024 Convertible Notes and 2026 Convertible Notes, after deducting fees and expenses of $9.0 million. The Company used $25.2 million of the net proceeds from the sale of the 2024 Convertible Notes and 2026 Convertible Notes to pay the cost of the Capped Calls, as described below. For purposes of this section, “Notes” refer to the 2024 Convertible Notes and the 2026 Convertible Notes, collectively. The 2024 Convertible Notes and 2026 Convertible Notes were issued by the Company on August 12, 2019, pursuant to separate Indentures, each dated as of such date (each an “Indenture” and together the “Indentures”), between the Company and the Trustee. The 2024 Convertible Notes bear cash interest at the annual rate of 0.75% and the 2026 Convertible Notes bear cash interest at the annual rate of 1.50%, each payable on June 15 and December 15 of each year. The 2024 Convertible Notes will mature on June 15, 2024 and the 2026 Convertible Notes will mature on June 15, 2026, unless earlier converted or repurchased. The Company will settle conversions of the 2024 Convertible Notes and 2026 Convertible Notes through payment or delivery, as the case may be, of cash, shares of the Company’s Class A Common Stock or a combination of cash and shares of Class A Common Stock, at the Company’s option (subject to, and in accordance with, the settlement provisions of the applicable Indenture). The initial conversion rate for each of the 2024 Convertible Notes and the 2026 Convertible Notes is 74.6687 shares of Class A Common Stock (subject to adjustment as provided for in the applicable Indenture) per $1,000 principal amount of the 2024 Convertible Notes and 2026 Convertible Notes, which is equal to an initial conversion price of approximately $13.39 per share. Holders of the 2024 Convertible Notes and 2026 Convertible Notes may convert their Notes at their option at any time prior to the close of business on the business day immediately preceding December 15, 2023, with respect to the 2024 Convertible Notes, and December 15, 2025, with respect to the 2026 Convertible Notes, in multiples of $1,000 principal amount, only under the following circumstances: ● during any calendar quarter commencing after the calendar quarter ending on December 31, 2019 (and only during such calendar quarter), if the last reported sale price of Class A Common Stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price for the Notes on each applicable trading day; ● during the five business day period after any five consecutive trading day period (the “measurement period”) in which the “trading price” (as defined in each Indenture) per $1,000 principal amount of Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of Class A Common Stock and the conversion rate for the Notes on each such trading day; or ● upon the occurrence of specified corporate events described in each Indenture. On or after December 15, 2023, with respect to the 2024 Convertible Notes, and December 15, 2025, with respect to the 2026 Convertible Notes, until the close of business on the second scheduled trading day immediately preceding the applicable maturity date, the holders of the Notes may convert their Notes, in multiples of $1,000 principal amount, regardless of the foregoing conditions. Upon the occurrence of fundamental changes, as described in the Indentures, prior to the maturity date of the respective Notes, holders of such Notes may require the Company to repurchase for cash all or a portion of their Notes at a repurchase price equal to 100% of the principal amount of the Notes to be repurchased, plus accrued and unpaid interest. If a make-whole fundamental change, as described in the Indentures, occurs and a holder elects to convert its Notes in connection with such make-whole fundamental change, such holder may be entitled to an increase in the conversion rate as described in the Indentures. The Indentures do not contain any financial covenants or restrict the Company’s ability to repurchase the Company’s securities, pay dividends or make restricted payments in the event of a transaction that substantially increases the Company’s level of indebtedness. The Indentures provide for customary events of default. In the case of an event of default with respect to a series of Notes arising from specified events of bankruptcy or insolvency, all outstanding Notes of such series will become due and payable immediately without further action or notice. If any other event of default with respect to a series of Notes under the relevant Indenture occurs or is continuing, the Trustee or holders of at least 25% in aggregate principal amount of the then outstanding Notes of such series may declare the principal amount of such Notes to be immediately due and payable. In accordance with accounting guidance for debt with conversion and other options, the Company separately accounted for the liability and equity components of the 2024 Convertible Notes and the 2026 Convertible Notes by allocating the proceeds between the liability components and the embedded conversion options, or equity components, due to the Company’s ability to settle the 2024 Convertible Notes and the 2026 Convertible Notes in cash, its Class A Common Stock, or a combination of cash and Class A Common Stock at the option of the Company. The carrying amount of the respective liability components were calculated by measuring the fair value of a similar liability that does not have an associated conversion feature. The respective equity components of the 2024 Convertible Notes and the 2026 Convertible Notes were recognized as a debt discount and represent the difference between the gross proceeds from the issuance of the 2024 Convertible Notes and 2026 Convertible Notes and the fair value of the liability of the 2024 Convertible Notes and 2026 Convertible Notes on their respective dates of issuance. The debt discount is amortized to interest expense using the effective interest method over approximately five The Company’s outstanding balances for the convertible senior notes as of December 31, 2021 and 2020 consisted of the following (in thousands): December 31, 2021 2020 Liability component: Principal: 2022 Convertible Notes $ 120,699 $ 120,699 2024 Convertible Notes 200,000 200,000 2026 Convertible Notes 200,000 200,000 Less: unamortized debt discount (61,641) (83,900) Less: unamortized debt issuance costs (4,867) (6,543) Net carrying amount $ 454,191 $ 430,256 Equity component: 2022 Convertible Notes 19,807 19,807 2024 Convertible Notes 41,152 41,152 2026 Convertible Notes 51,350 51,350 Total equity component $ 112,309 $ 112,309 In connection with the issuance of the 2022 Convertible Notes, the Company incurred $11.7 million of debt issuance costs, which primarily consisted of initial purchasers’ discounts and legal and other professional fees. The Company allocated these costs to the liability and equity components based on the allocation of the proceeds. The portion of these costs allocated to the equity components totaling $4.0 million were recorded as a reduction to additional paid-in capital upon issuance. The portion of these costs allocated to the liability components totaling $7.7 million were recorded as a reduction in the carrying value of the debt on the consolidated balance sheet and are amortized to interest expense using the effective interest method over the expected life of the 2022 Convertible Notes. In connection with the partial repurchase of the 2022 Convertible Notes, the Company recorded a loss on extinguishment of debt of $23.4 million, of which $2.8 million related to the initial debt issuance costs, during the year ended December 31, 2019. The Company determined the expected life of the 2022 Convertible Notes was equal to their seven-year term. The effective annual interest rate on the liability components of the 2022 Convertible Notes for the period from the date of issuance through June 30, 2019 was 9.34%. From the date of the partial repurchase of the 2022 Convertible Notes in August 2019 through December 31, 2021, the effective annual interest rate on the liability component of the 2022 Convertible Notes was 10.1%. In connection with the issuance of the 2024 Convertible Notes and the 2026 Convertible Notes, the Company incurred $9.0 million of debt issuance costs, which primarily consisted of initial purchaser’s discounts and legal and other professional fees. The Company allocated these costs to the liability and equity components based on the allocation of the proceeds. The portion of these costs allocated to the equity components totaling $2.1 million were recorded as a reduction to additional paid-in capital. The portion of these costs allocated to the liability components totaling $6.9 million were recorded as a reduction in the carrying value of the debt on the consolidated balance sheet and are amortized to interest expense using the effective interest method over the expected lives of the 2024 Convertible Notes and the 2026 Convertible Notes. The Company determined the expected life of the 2024 Convertible Notes and the 2026 Convertible Notes was equal to their approximately five The following table sets forth total interest expense recognized related to convertible senior notes during the years ended December 31, 2021, 2020, and 2019 (in thousands): Year Ended December 31, 2021 2020 2019 Contractual interest expense $ 7,216 $ 7,216 $ 7,361 Amortization of debt issuance costs 1,678 1,462 1,190 Amortization of debt discount 22,256 20,800 17,683 Total interest expense $ 31,150 $ 29,478 $ 26,234 Future minimum payments under the convertible senior notes as of December 31, 2021, are as follows (in thousands): 2022 $ 126,557 2023 4,500 2024 203,750 2025 3,000 2026 201,500 Total future minimum payments under the convertible senior notes 539,307 Less: amounts representing interest (18,608) Less: unamortized debt discount (61,641) Less: unamortized debt issuance costs (4,867) Convertible senior notes balance $ 454,191 As of December 31, 2021, $120.7 million in aggregate principal amount of the 2022 Convertible Notes was due within the next 12 months and is classified as current liabilities on the Company’s consolidated balance sheets. Convertible Note Hedge and Note Hedge Warrant Transactions with Respect to 2022 Convertible Notes To minimize the impact of potential dilution to the Company's Class A common stockholders upon conversion of the 2022 Convertible Notes, the Company entered into the Convertible Note Hedges covering 20,249,665 shares of the Company’s Class A Common Stock in connection with the issuance of the 2022 Convertible Notes. The Convertible Note Hedges had an initial exercise price of $16.58 per share, subject to adjustment upon the occurrence of certain corporate events or transactions, and are exercisable if the 2022 Convertible Notes are converted. In connection with the adjustment to the conversion rate of the 2022 Convertible Notes related to the Separation in April 2019, the exercise price of the Convertible Note Hedges was adjusted to $14.51 per share and the number of shares underlying the Convertible Note Hedges was increased to 23,135,435 shares. If upon conversion of the 2022 Convertible Notes, the price of the Company’s Class A Common Stock is above the exercise price of the Convertible Note Hedges, the counterparties are obligated to deliver shares of the Company’s Class A Common Stock and/or cash with an aggregate value approximately equal to the difference between the price of the Company’s Class A Common Stock at the conversion date and the exercise price, multiplied by the number of shares of the Company’s Class A Common Stock related to the Convertible Note Hedge being exercised. Concurrently with entering into the Convertible Note Hedges, the Company sold Note Hedge Warrants to the Convertible Note Hedge counterparties to acquire 20,249,665 shares of the Company’s Class A Common Stock, subject to customary anti-dilution adjustments. The strike price of the Note Hedge Warrants was initially $21.50 per share, subject to adjustment, and such warrants are exercisable over the 150 trading day period beginning on September 15, 2022. In connection with the Separation in April 2019, the exercise price was adjusted to $18.82 per share and the number of shares underlying the Note Hedge Warrants was increased to 23,135,435 shares. The Note Hedge Warrants could have a dilutive effect on the Class A Common Stock to the extent that the market price per share of the Company’s Class A Common Stock exceeds the applicable strike price of such warrants. The Convertible Note Hedges and the Note Hedge Warrants are separate transactions entered into by the Company and are not part of the terms of the 2022 Convertible Notes. Holders of the Convertible Note Hedges and the Note Hedge Warrants do not have any rights with respect to the 2022 Convertible Notes. The Company paid $91.9 million for the Convertible Note Hedges and received $70.8 million for the Note Hedge Warrants, resulting in a net cost to the Company of $21.1 million. In August 2019, concurrently with the repurchase of $215.0 million aggregate principal amount of the 2022 Convertible Notes, the Company terminated the respective portion of the Convertible Note Hedges and Note Hedge Warrants. The Company received $3.2 million of termination payments from the counterparties of the Convertible Note Hedges and Note Hedge Warrants. The Convertible Note Hedges and Note Hedge Warrants are accounted for as derivative assets and liabilities, respectively, in accordance with ASC 815, and are remeasured to fair value at each reporting date (Note 6). As of December 31, 2021, the Convertible Note Hedges and Note Hedge Warrants were classified as current assets and current liabilities, respectively, on the Company’s consolidated balance sheets. As of December 31, 2020, the Convertible Note Hedges and Note Hedge Warrants were classified as non-current assets and non-current liabilities, respectively, on the Company’s consolidated balance sheets. Capped Calls with Respect to 2024 Convertible Notes and 2026 Convertible Notes To minimize the impact of potential dilution to the Company’s Class A common stockholders upon conversion of the 2024 Convertible Notes and the 2026 Convertible Notes, the Company entered into separate Capped Calls in connection with the issuance of the 2024 Convertible Notes and the 2026 Convertible Notes. The Company paid the counterparties $25.2 million to enter into the Capped Calls. The Capped Calls have an initial strike price of approximately $13.39 per share, which corresponds to the initial conversion price of the 2024 Convertible Notes and the 2026 Convertible Notes and is subject to anti-dilution adjustments generally similar to those applicable to the 2024 Convertible Notes and the 2026 Convertible Notes. The Capped Calls have a cap price of approximately $17.05 per share, subject to certain adjustments. The Capped Calls cover 29,867,480 shares of Class A Common Stock (subject to anti-dilution and certain other adjustments), which is the same number of shares of Class A Common Stock that initially underlie the 2024 Convertible Notes and the 2026 Convertible Notes. The Capped Calls are expected generally to reduce the potential dilution to the Class A Common Stock upon conversion of the 2024 Convertible Notes and the 2026 Convertible Notes in the event that the market price per share of Class A Common Stock is greater than the strike price of the Capped Calls as adjusted pursuant to the anti-dilution adjustments. If, however, the market price per share of Class A Common Stock exceeds the cap price of the Capped Calls, there would nevertheless be dilution upon conversion of the 2024 Convertible Notes and the 2026 Convertible Notes to the extent that such market price exceeds the cap price of the Capped Calls. The Capped Calls are separate transactions entered into by and between the Company and the Capped Calls counterparties and are not part of the terms of the 2024 Convertible Notes or the 2026 Convertible Notes. Holders of the 2024 Convertible Notes and the 2026 Convertible Notes do not have any rights with respect to the Capped Calls. The Company recorded a reduction to additional paid-in capital of $25.0 million during the year ended December 31, 2019 related to the premium payments for the Capped Calls. Additionally, the Company recorded a $0.2 million reduction to equity related to transaction costs incurred in connection with the Capped Calls during the year ended December 31, 2019. These instruments meet the conditions outlined in ASC 815 to be classified in stockholders’ equity and are not subsequently remeasured as long as the conditions for equity classification continue to be met. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Text Block | |
Commitments and Contingencies | 11. Commitments and Contingencies Commitments with AbbVie The Company and AbbVie are jointly obligated to make minimum purchases of linaclotide API for the territories covered by the Company’s collaboration with AbbVie for North America. Currently, AbbVie fulfills all such minimum purchase commitments. Under the collaboration agreement with AbbVie for North America, the Company shares all development and commercialization costs related to linaclotide in the U.S. with AbbVie. The actual amounts that the Company pays to AbbVie or that AbbVie pays to the Company will depend on numerous factors outside of the Company’s control, including the success of certain clinical development efforts with respect to linaclotide, the content and timing of decisions made by the regulators, the reimbursement and competitive landscape around linaclotide and the Company’s other product candidates, and other factors. Other Funding Commitments As of December 31, 2021, the Company has ongoing studies in various pre-clinical and clinical trial stages. The Company’s most significant clinical trial expenditures are to contract research organizations. These contracts are generally cancellable, with notice, at the Company’s option and do not have any significant cancellation penalties. Guarantees As permitted under Delaware law, the Company indemnifies its directors and certain of its officers for certain events or occurrences while such director or officer is, or was, serving at the Company’s request in such capacity. The maximum potential amount of future payments the Company could be required to make is unlimited; however, the Company has directors’ and officers’ insurance coverage that is intended to limit its exposure and enable it to recover a portion of any future amounts paid. The Company enters into certain agreements with other parties in the ordinary course of business that contain indemnification provisions. These typically include agreements with business partners, contractors, landlords, clinical sites and customers. Under these provisions, the Company generally indemnifies and holds harmless the indemnified party for losses suffered or incurred by the indemnified party as a result of the Company’s activities. These indemnification provisions generally survive termination of the underlying agreements. The maximum potential amount of future payments the Company could be required to make under these indemnification provisions is unlimited. However, to date the Company has not incurred material costs to defend lawsuits or settle claims related to these indemnification provisions. As a result, the estimated fair value of these obligations is minimal. Accordingly, the Company did not have any liabilities recorded for these obligations as of December 31, 2021 and 2020. Litigation From time to time, the Company is involved in various legal proceedings and claims, either asserted or unasserted, which arise in the ordinary course of business. While the outcome of these other claims cannot be predicted with certainty, management does not believe that the outcome of any of these ongoing legal matters, individually and in aggregate, will have a material adverse effect on the Company’s consolidated financial statements. In January 2020, the Company and AbbVie entered into settlement agreements with Sandoz Inc. and Teva Pharmaceuticals, USA resolving patent litigation brought in response to the last outstanding abbreviated new drug applications seeking approval to market generic versions of LINZESS prior to the expiration of the Company’s and AbbVie’s applicable patents. In May 2021, the Company and AbbVie entered into a settlement agreement with Teva, under which the Company and AbbVie will grant Teva a license to market a generic version of 72 mcg LINZESS beginning March 31, 2029 (subject to FDA approval), unless certain limited circumstances, customary for settlement agreements of this nature, occur. With this settlement agreement, the Company and AbbVie have settled with the filers of all known ANDAs to date seeking approval to market generic versions of LINZESS. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Text Block | |
Stockholders' Equity | 12. Stockholders’ Equity Preferred Stock The Company’s preferred stock may be issued from time to time in one or more series, with each such series to consist of such number of shares and to have such terms as adopted by the board of directors. Authority is given to the board of directors to determine and fix such voting powers, full or limited, or no voting powers, and such designations, preferences and relative participating, optional or other special rights, and qualifications, limitation or restrictions thereof, including without limitation, dividend rights, conversion rights, redemption privileges and liquidation preferences. Common Stock The Company has one class of common stock (“Class A Common Stock”). Class A Common Stock is entitled to one vote per share. The Company has reserved, out of its authorized but unissued shares of Class A Common Stock, sufficient shares to effect the conversion of the convertible senior notes and the Note Hedge Warrants pursuant to the terms thereof (Note 10). The Company’s shareholders are entitled to dividends if and when declared by the board of directors. Share Repurchase Program In May 2021, the Company’s Board of Directors authorized a program to repurchase up to $150.0 million of the Company’s Class A Common Stock. Unless it is terminated or suspended prior to its expiration, the share repurchase program will remain in effect until December 31, 2022. The timing and amount of any repurchases will be determined based on market conditions, stock price and other factors. The share repurchase program may be modified, suspended or discontinued at any time without notice. Repurchases may be made through a variety of methods, including open market purchases, privately negotiated transactions, block trades, exchange transactions, accelerated share repurchase transactions, or any combination of such methods. All share repurchases made under the share repurchase program will be retired. During the year ended December 31, 2021, the Company repurchased 2.4 million shares of Class A common stock for an aggregate of $27.1 million. The Company expects to fund further repurchases through a combination of cash on hand and cash generated by operations. As of December 31, 2021, the aggregate remaining value of shares that may be repurchased under the repurchase program was $122.9 million. |
Employee Stock Benefit Plans
Employee Stock Benefit Plans | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Text Block | |
Employee Stock Benefit Plans | 13. Employee Stock Benefit Plans The Company has several share-based compensation plans under which stock options, RSAs, RSUs, and other share-based awards are available for grant to employees, officers, directors and consultants of the Company. The following table summarizes share-based compensation expense by award type (in thousands): Year Ended December 31, 2021 2020 2019 Stock options $ 3,154 $ 7,680 $ 12,526 Time-based restricted stock units 14,539 18,624 15,488 Performance-based restricted stock units 1,295 2,190 — Restricted stock awards 2,684 1,886 2,095 Employee stock purchase plan 419 722 1,115 Stock awards 190 73 54 Total share-based compensation expense $ 22,281 $ 31,175 $ 31,278 The following table summarizes the share-based compensation expense reflected in the consolidated statements of income (in thousands): Year Ended December 31, 2021 2020 2019 Share-based compensation expense: Research and development $ 4,849 $ 5,569 $ 6,343 Selling, general and administrative 17,323 23,825 24,281 Restructuring expenses 109 1,781 654 Total share-based compensation expense $ 22,281 $ 31,175 $ 31,278 Restructuring expenses include modifications to share-based awards held by employees impacted by various workforce reductions (Note 17). In April 2019, in connection with the Separation, all outstanding share-based payment awards were modified in accordance with the equity conversion-related provisions of the employee matters agreement with Cyclerion. No share-based compensation expense was recognized in connection with these modifications. Additionally, modifications with respect to the Company’s ESPP were made due to the change in share price as a result of the Separation. As a result of the modification to the ESPP, the Company recorded $0.3 million of share-based compensation expense for the year ended December 31, 2019. Stock Benefit Plans As of December 31, 2021, the Company has the following active stock benefit plans pursuant to which awards are currently outstanding: the 2019 Equity Incentive Plan (the “2019 Equity Plan”), the Amended and Restated 2010 Employee Stock Purchase Plan (the “2010 Purchase Plan”) and the Amended and Restated 2010 Employee, Director, and Consultant Equity Incentive Plan (the “2010 Equity Plan”). At December 31, 2021, there were 13,344,791 shares available for future grant under the 2019 Equity Plan and the 2010 Purchase Plan. 2019 Equity Plan During 2019, the Company’s stockholders approved the 2019 Equity Plan under which stock options, RSAs, RSUs, and other stock-based awards may be granted to employees, officers, directors, or consultants of the Company. Under the 2019 Equity Plan, 10,000,000 shares of Class A Common Stock were initially reserved for issuance. Awards that are returned to the 2010 Equity Plan as a result of their expiration, cancellation, termination or repurchase are automatically made available for issuance under the 2019 Equity Plan. Awards that expire, cancel, terminate, or are repurchased under the 2019 Equity Plan will no longer be available for future grant. As of December 31, 2021, 8,773,291 shares were available for future grant under the 2019 Equity Plan. 2010 Purchase Plan During 2010, the Company’s stockholders approved the 2010 Purchase Plan, which gives eligible employees the right to purchase shares of common stock at the lower of 85% of the fair market value on the first or last day of an offering period. Each offering period is six months. There were 400,000 shares of common stock initially reserved for issuance pursuant to the 2010 Purchase Plan. The number of shares available for future grant under the 2010 Purchase Plan may be increased on the first day of each fiscal year by an amount equal to the lesser of: (i) 1,000,000 shares, (ii) 1% of the Class A shares of common stock outstanding on the last day of the immediately preceding fiscal year, or (iii) such lesser number of shares as is determined by the board of directors. As of December 31, 2021, there were 4,571,500 shares available for future grant under the 2010 Purchase Plan. 2010 Equity Plan The 2010 Equity Plan provided for the granting of stock options, RSAs, RSUs, and other share-based awards to employees, officers, directors, consultants, or advisors of the Company. At December 31, 2021, there were no shares available for future grant under the 2010 Equity Plan. Restricted Stock Awards RSAs are granted to non-employee members of the board of directors under restricted stock agreements in accordance with the terms of the 2019 Equity Plan and the Company’s non-employee director compensation policy, effective May 2019. Annual restricted stock grants to each non-employee member of the board of directors vest in full on the date immediately preceding the next annual meeting of stockholders, provided the individual continues to serve on the Company’s board of directors through each vest date. Initial restricted stock grants to new non-employee members of the board of directors vest annually over a three-year period from the date of grant provided the individual continues to serve on the Company’s board of directors through each vest date. A summary of restricted stock activity for the year ended December 31, 2021 is presented below: Weighted- Average Number of Grant Date Shares Fair Value Unvested as of December 31, 2020 246,500 $ 10.38 Granted 230,160 11.67 Vested (213,400) 11.58 Forfeited — — Unvested as of December 31, 2021 263,260 $ 11.61 The weighted-average grant date fair value per share of restricted stock awards granted during the years ended December 31, 2021, 2020, and 2019 was $11.67, $10.16, and $10.96, respectively. Amounts relating to restricted stock awards granted prior to the Separation have not been adjusted to reflect the effect of the Separation on the Company’s stock price. Restricted Stock Units RSUs granted under the Company’s equity plans represent the right to receive one share of the Company’s Class A Common Stock pursuant to the terms of the applicable award agreement. Shares of the Company’s Class A Common Stock are delivered to the employee upon vesting, subject to payment of applicable withholding taxes. Time-based RSUs Time-based RSUs generally vest over a two A summary of time-based RSU activity for the year ended December 31, 2021 is as follows: Weighted- Average Number Grant Date of RSUs Fair Value Outstanding as of December 31, 2020 4,170,626 $ 11.90 Granted 2,707,427 10.40 Vested and released (1,697,745) 12.18 Forfeited (1,316,200) 11.38 Outstanding as of December 31, 2021 3,864,108 $ 10.89 The weighted-average grant date fair value per share of time-based RSUs granted during the years ended December 31, 2021, 2020, and 2019 was $10.40, $11.59, and $12.11, respectively. Amounts relating to time-based RSUs granted prior to the Separation have not been adjusted to reflect the effect of the Separation on the Company’s stock price. Performance-based RSUs Performance-based RSUs (“PSUs”) were granted to certain executives in 2021 and 2020. PSUs vest upon the achievement of specified performance criteria over a two The fair value of Pipeline PSUs and Profitability PSUs is based on the market value of the Company's Class A Common Stock on the date of grant. The Relative TSR PSUs are valued using the Monte Carlo simulation method on the date of grant. The weighted average assumptions used to estimate the fair value of Relative TSR PSUs were as follows for the year ended December 31, 2021: Year Ended December 31, 2021 Fair value of common stock $ 11.39 Expected volatility 47.9 % Expected term (in years) 2.6 Risk-free interest rate 0.3 % Expected dividend yield — % A summary of PSU activity for the year ended December 31, 2021 is as follows: Weighted- Average Number Grant Date of PSUs Fair Value Outstanding as of December 31, 2020 586,157 $ 12.48 Granted 661,651 14.65 Vested and released — — Forfeited (414,522) 12.76 Outstanding as of December 31, 2021 833,286 $ 14.06 Stock Options Stock options granted under the Company’s equity plans represent the right to purchase one share of the Company’s Class A Common Stock pursuant to the terms of the applicable award agreement. Shares of the Company's Class A Common Stock are delivered to the employee upon exercise, subject to payment of applicable withholding taxes. As of April 2020, the Company no longer grants stock options. Stock options previously granted under the Company’s equity plans generally have a ten-year term and vest over a period of four years, provided the individual continues to serve at the Company through the vesting dates. Options granted under all equity plans are exercisable at a price per share not less than the fair market value of the underlying common stock on the date of grant. The estimated fair value of options, including the effect of estimated forfeitures, is recognized over the requisite service period, which is typically the vesting period of each option. The weighted average assumptions used to estimate the fair value of the stock options using the Black-Scholes option-pricing model were as follows for the years ended December 31, 2020 and 2019: Year Ended December 31, 2020 2019 Expected volatility 46.6 % 46.3 % Expected term (in years) 6.1 6.1 Risk-free interest rate 1.5 % 2.5 % Expected dividend yield — % — % Expected volatility is based on the historical volatility of the Company’s Class A Common Stock. The Company estimates the expected term using historical data. The risk-free interest rate used for each grant is based on a zero-coupon U.S. Treasury instrument with a remaining term similar to the expected term of the share-based award. The Company has not paid and does not anticipate paying cash dividends on its shares of common stock in the foreseeable future; therefore, the expected dividend yield is assumed to be zero. The weighted-average grant date fair value per share of options granted during the years ended December 31, 2020 and 2019 was $5.89 and $6.10, respectively. Amounts relating to stock options granted prior to the Separation have not been adjusted to reflect the effect of the Separation on the Company’s stock price. The Company historically granted to certain employees performance-based options to purchase shares of common stock. These options are subject to performance-based milestone vesting. During the years ended December 31, 2021, 2020 and 2019, there were no shares that vested as a result of performance milestone achievements. The Company recorded an insignificant amount of share-based compensation expense related to these performance-based options during the year ended December 31, 2021 and no share-based compensation expense related to these performance-based options during the years ended December 31, 2020 and 2019. The following table summarizes stock option activity under the Company’s share-based compensation plans, including performance-based options: Weighted- Weighted- Number of Average Average Aggregate Stock Exercise Contractual Intrinsic Options Price (1) Life Value (in years) (in thousands) Outstanding at December 31, 2020 13,459,671 $ 12.25 4.27 $ 5,613 Granted — — — — Exercised (1,698,362) 10.83 — — Cancelled (2,388,515) 13.07 — — Outstanding at December 31, 2021 9,372,794 12.30 3.51 4,528 Vested or expected to vest at December 31, 2021 9,331,488 12.31 3.49 4,509 Exercisable at December 31, 2021 8,972,651 12.33 3.38 4,385 (1) Exercise prices relating to stock options granted prior to the Separation have not been adjusted to reflect the effect of the Separation on the stock options. The total intrinsic value of options exercised during the years ended December 31, 2021, 2020, and 2019 was $2.7 million, $3.5 million, and $5.1 million, respectively. The intrinsic value was calculated as the difference between the fair value of the Company’s Class A Common Stock at the date of exercise and the exercise price of the option issued. The following table sets forth the Company's unrecognized share-based compensation expense, net of estimated forfeitures, as of December 31, 2021, by type of award and the weighted-average period over which that expense is expected to be recognized: Unrecognized Weighted-Average Expense, Net Remaining of Estimated Recognition Forfeitures Period (in thousands) (in years) Type of award: Stock options with time-based vesting $ 1,541 1.14 Restricted stock awards 1,464 0.60 Time-based restricted stock units 22,545 2.46 Performance-based restricted stock units 3,816 1.74 Stock options with time-based and performance-based vesting — — The total unrecognized share-based compensation cost will be adjusted for future changes in estimated forfeitures. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Text Block | |
Income Taxes | 14. Income Taxes Year Ended December 31, 2021 2020 2019 Current: Federal $ — $ — $ — State 5,503 2,685 — Total current 5,503 2,685 — Deferred: Federal (251,367) — — State (81,927) — — Total deferred (333,294) — — Total income tax (benefit) expense $ (327,791) $ 2,685 $ — During the year ended December 31, 2021, the Company recorded income tax benefit of $327.8 million, which primarily pertains to the income tax benefit of $333.3 million related to the release of the valuation allowance on the majority of the Company’s tax attributes and other deferred tax assets, partially offset by $5.5 million of state income taxes in certain states in which the Company is unable to utilize net operating losses to fully offset taxable income. During the year ended December 31, 2020, the Company recorded $2.7 million in income tax expense related to state income taxes in certain states which had temporarily disallowed or only partially allow the use of net operating losses to offset taxable income. The Company did not record a provision for federal income taxes for the period ended December 31, 2020, as it offset taxable income with federal net operating losses and recorded a full valuation allowance against net deferred tax assets. The Company did not record a provision for federal, state , or foreign income taxes for the period ended December 31, 2019 because the Company incurred a tax loss during the year and offset the benefit of these tax losses with valuation allowance. The Company has not recorded a foreign tax provision as it has had cumulative net operating losses outside of the United States since inception. On March 27, 2020. the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act was enacted and signed into law. The Company benefitted from certain provisions of the CARES Act, specifically, the increase in allowable business interest deduction from 30% of adjusted taxable income to 50% of adjusted taxable income, which allowed the Company to take additional interest deductions for the period ended December 31, 2020. Additionally, the Company was able to claim 100% bonus depreciation on leasehold improvements incurred in the period ended December 31, 2020 and 2019. A reconciliation of income taxes computed using the U.S. federal statutory rate of 21% to that reflected in the consolidated statements of income are as follows (in thousands): Year Ended December 31, 2021 2020 2019 Income tax expense (benefit) using U.S. federal statutory rate $ 42,138 $ 22,861 $ 4,517 Permanent differences 34 74 65 State income taxes, net of federal benefit 12,554 7,565 (1,902) Disallowed Separation related costs — — 4,658 Executive compensation - Section 162(m) 695 1,718 662 Meals and entertainment 349 395 495 Non-deductible share-based compensation 43 (144) (1,202) Excess tax benefits 6,270 5,132 3,324 Fair market valuation of Note Hedge Warrants and Convertible Note Hedges 325 1,680 (290) Tax credits (9) (3,149) (4,374) Expiring net operating losses and tax credits 491 1,991 3,764 Effect of change in state tax rate on deferred tax assets and deferred tax liabilities 123 (208) (2,563) Change in the valuation allowance (390,804) (35,230) (7,154) Income tax expense (benefit) $ (327,791) $ 2,685 $ — The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities. These differences are measured using the enacted statutory tax rates that are expected to be in effect for the years in which differences are expected to reverse. Deferred tax assets and liabilities were determined based on the difference between financial statement and tax bases using enacted tax rates in effect for the year in which the differences are expected to reverse. December 31, 2021 2020 Deferred tax assets: Net operating loss carryforwards $ 165,022 $ 234,772 Tax credit carryforwards 60,125 60,607 Capitalized research and development 4,981 7,498 Share-based compensation 16,857 21,848 Basis difference on collaboration agreement for North America with AbbVie 78,194 62,629 Accruals and reserves 5,003 6,114 Basis difference on 2022 Convertible Notes 8,166 6,183 Intangible assets 5,396 — Interest expense — 3,386 Operating lease liability 5,971 6,504 Other 3,997 5,049 Total deferred tax assets 353,712 414,590 Deferred tax liabilities: Basis difference on 2024 Convertible Notes (4,363) (5,951) Basis difference on 2026 Convertible Notes (7,597) (9,022) Operating lease right-of-use assets (4,248) (4,603) Total deferred tax liabilities (16,208) (19,576) Net deferred tax asset 337,504 395,014 Valuation allowance (4,210) (395,014) Net deferred tax asset $ 333,294 $ — On a periodic basis, the Company reassesses the valuation allowance on its deferred income tax assets weighing positive and negative evidence to assess the recoverability of the deferred tax assets. During the year ended December 31, 2021, the Company reassessed the valuation allowance noting the shift of positive evidence outweighing negative evidence, including: continued strong prescription demand growth of LINZESS, continued profitability of a GI-focused business since completing the tax-free spin-off of Cyclerion, and expectations regarding future profitability. After assessing both the positive evidence and negative evidence, management determined it was more likely than not that the Company will realize the majority of its deferred tax assets and during the year ended December 31, 2021, released the majority of its valuation allowance for the deferred tax assets that are expected to be utilized in future years. The Company will maintain a valuation allowance on deferred tax assets not expected to be realized, related primarily to certain tax credits that are expected to expire prior to utilization. The Company’s total deferred tax asset balance subject to a valuation allowance analysis was $337.5 million and $395.0 million as of December 31, 2021 and 2020, respectively. The net deferred tax assets were fully offset by a valuation allowance as of December 31, 2020. The valuation allowance decreased by $390.8 million during the year ended December 31, 2021 primarily due to the Company’s release of the majority of its valuation allowance, as described above, as well as the use of net operating losses to offset taxable income. The valuation allowance decreased $35.2 million during the year ended December 31, 2020 primarily due to the Company’s offsetting taxable income with previously disallowed interest expense and net operating losses, partially offset by an increase in deferred tax asset for the basis difference of the collaboration agreement for North America with AbbVie. Subject to the limitations described below, at December 31, 2021, the Company had federal net operating loss carryforwards of $935.4 million, of which $805.8 million is subject to expiration between 2022 and 2037 and approximately $129.6 million may be carried forward indefinitely. As of December 31, 2021, the Company had state net operating loss carryforwards of $718.9 million to offset future state taxable income, which is subject to expiration between 2022 and 2039. The Company also had tax credit carryforwards of $64.7 million as of December 31, 2021 to offset future federal and state income taxes, which is subject to expiration at various times through 2040. Utilization of net operating loss carryforwards and research and development credit carryforwards may be subject to a substantial annual limitation due to ownership change limitations that could occur in the future in accordance with Section 382 of the Internal Revenue Code of 1986 (“IRC Section 382”) and with Section 383 of the Internal Revenue Code of 1986, as well as similar state provisions. These ownership changes may limit the amount of net operating loss carryforwards and research and development credit carryforwards that can be utilized annually to offset future taxable income and taxes, respectively. In general, an ownership change, as defined by IRC Section 382, results from transactions increasing the ownership of certain stockholders or public groups in the stock of a corporation by more than 50 percentage points over a three-year period. The following table summarizes the changes in the Company’s unrecognized income tax benefits for the years ended December 31, 2021, 2020, and 2019 (in thousands): Year Ended December 31, 2021 2020 2019 Balance at the beginning of the period $ 68,087 $ 53,099 $ 38,551 Increases based on tax positions related to the current period 83,206 66,687 51,699 Increases for tax positions related to prior periods — — 1,400 Decreases for tax positions in prior periods (66,687) (51,699) (38,551) Balance at the end of the period $ 84,606 $ 68,087 $ 53,099 The Company had gross unrecognized tax benefits of $84.6 million, $68.1 million, and $53.1 million as of December 31, 2021, 2020 and 2019 . total unrecognized tax benefits at December 31, 2021, $ million would, if recognized, affect the Company’s effective tax rate, and the remaining amount would not affect the Company’s effective tax rate, as it relates to a temporary timing difference. A reserve for uncertain tax positions of $ million is recorded in other liabilities on the Company’s consolidated balance sheet as of December 31, 2021. The Company will recognize interest and penalties, if any, related to uncertain tax positions in income tax expense. As of December 31, 2021, an insignificant amount of penalties have been accrued. The statute of limitations for assessment by the Internal Revenue Service (“IRS”) and state tax authorities is open for tax years ended December 31, 2018 through the present, although net operating losses generated from years prior to 2018 could be subject to examination and adjustments to the extent utilized in future years. There are currently no federal or state income tax audits in progress. |
Defined Contribution Plan
Defined Contribution Plan | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Text Block | |
Defined Contribution Plan | 15. Defined Contribution Plan The Ironwood Pharmaceuticals, Inc. 401(k) Savings Plan is a defined contribution plan in the form of a qualified 401(k) plan in which substantially all employees are eligible to participate upon employment. Subject to certain IRS limits, eligible employees may elect to contribute from 1% to 100% of their compensation. Company contributions to the plan are at the sole discretion of the Company. During the year ended December 31, 2021, the Company provided a matching contribution equal to the greater of: (a) 100% of employee contributions on the first 3% of eligible compensation and 50% of employee contributions on the next 3% of eligible compensation; or (b) 75% of the first $10,000 of employee contributions, up to $7,500. During the years ended December 31, 2020 and 2019, the Company provided a matching contribution of 75% of the employee’s contributions, up to $6,000 annually. During the years ended December 31, 2021, 2020, and 2019, the Company recorded $2.2 million, $1.8 million, and $2.2 million of expense related to its 401(k) company match, respectively. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Text Block | |
Related Party Transactions | 16. Related Party Transactions The Company previously reflected amounts due from and due to Allergan plc prior to its acquisition by AbbVie in May 2020 as related party receivables and payables, as appropriate. Following the acquisition of Allergan plc by AbbVie, the Company determined that AbbVie is not a related party to the Company. In connection with the Separation, the Company executed certain contracts with Cyclerion, whose President and Chief Scientific Officer at the time of the Separation became a member of the Company’s Board of Directors in April 2019 (Note 3). As of December 31, 2020, the Company determined that Cyclerion was no longer considered a related party. |
Workforce Reduction and Restruc
Workforce Reduction and Restructuring | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Text Block | |
Workforce Reduction and Restructuring | 17. Workforce Reductions and Restructuring During the years ended December 31, 2021, 2020, and 2019 the Company recorded an insignificant amount, $15.4 million, and $3.6 million in restructuring expenses, respectively, in its consolidated statements of income. In August 2018, the Company initiated a reduction in its workforce by approximately 100 employees, primarily consisting of field-based sales representatives in connection with the termination of the lesinurad license agreement and substantially completed the reduction in its workforce and recorded associated costs during the year ended December 31, 2018. During the years ended December 31, 2020 and 2019, the Company recorded an insignificant amount of adjustments to restructuring costs related to this workforce reduction. In February 2019, following further analysis of the Company’s strategy and core business needs, and in an effort to further strengthen the operational efficiency of the organization, the Company commenced a reduction in workforce by approximately 35 employees, primarily based in the home office and substantially completed the reduction in its workforce and recorded associated costs during the year ended December 31, 2019. During the year ended December 31, 2019, the Company recorded $3.7 million of severance, benefits and related costs as restructuring expenses related to this reduction in workforce. In September 2020, the Company announced that one of its two identical Phase III trials evaluating IW-3718 in refractory GERD did not meet certain criteria, including the study’s primary endpoint of achieving a statistically significant improvement in heartburn severity. Based on these findings, the Company discontinued development of IW-3718. In connection with this decision, the Company reduced its workforce by approximately 100 full-time employees. This workforce reduction affected both field-based and home-office employees, including the relevant general and administrative support functions. The Company substantially completed the reduction in its workforce in the year ended December 31, 2020. The Company incurred an insignificant amount and $15.5 million during the years ended December 31, 2021 and 2020, respectively, in restructuring expenses, primarily for severance, benefits and related costs related to this reduction in its workforce. Restructuring expenses during the year ended December 31, 2020 also included $1.2 million related to the impairment of certain fixed assets as a result of the Company’s decision to discontinue IW-3718 development. The following table summarizes the accrued liabilities activity recorded in connection with the reduction in workforce in September 2020 and related restructuring activities during the year ended December 31, 2021 (in thousands): Amounts Amounts Accrued at Accrued at December 31, 2020 Charges Amount Paid Adjustments December 31, 2021 Employee severance, benefits and related costs $ 10,902 $ 1,025 $ (10,611) $ (854) $ 462 Contract related costs 5 48 (53) — — Total $ 10,907 $ 1,073 $ (10,664) $ (854) $ 462 The following table summarizes the accrued liabilities activity recorded in connection with the reductions in workforce and related restructuring activities during the year ended December 31, 2020 (in thousands): Amounts Amounts Accrued at Accrued at December 31, 2019 Charges Amount Paid Adjustments December 31, 2020 Employee severance, benefits and related costs February 2019 Reduction $ 75 $ — $ (75) $ — $ — September 2020 Reduction — 11,563 (661) — 10,902 Total $ 75 $ 11,563 $ (736) $ — $ 10,902 Contract related costs August 2018 Reduction $ 104 $ — $ — $ (104) $ — September 2020 Reduction — 108 (103) — 5 Total $ 104 $ 108 $ (103) $ (104) $ 5 |
Selected Quarterly Financial Da
Selected Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure Text Block | |
Selected Quarterly Financial Data (Unaudited) | 18. Selected Quarterly Financial Data (Unaudited) The following table contains quarterly financial information for the years ended December 31, 2021 and 2020. The Company believes that the following information reflects all normal recurring adjustments necessary for a fair presentation of the information for the periods presented. The operating results for any quarter are not necessarily indicative of results for any future period. First Second Third Fourth Total Quarter Quarter Quarter Quarter Year (in thousands, except per share data) 2021 Total revenues $ 88,845 $ 104,031 $ 103,747 $ 117,130 $ 413,753 Total cost and expenses 43,447 38,933 38,576 60,538 181,494 Other expense, net (5,040) (10,726) (5,499) (10,337) (31,602) Net income and comprehensive income 39,926 391,303 55,845 41,374 528,448 Net income per share—basic 0.25 2.42 0.34 0.25 3.26 Net income per share—diluted 0.25 2.39 0.34 0.25 3.21 First Second Third Fourth Total Quarter Quarter Quarter Quarter Year (in thousands, except per share data) 2020 Total revenues $ 79,943 $ 89,432 $ 103,468 $ 116,680 $ 389,523 Total cost and expenses 66,716 56,719 57,852 65,296 246,583 Other expense, net (9,882) (7,509) (9,804) (6,884) (34,079) Net income and comprehensive income 3,345 25,204 34,423 43,204 106,176 Net income per share—basic 0.02 0.16 0.22 0.27 0.67 Net income per share—diluted 0.02 0.16 0.21 0.27 0.66 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure Text Block | |
Subsequent Events | 19. Subsequent Events Share Repurchases From January 1, 2022 to February 15, 2022, the Company repurchased 4.5 million shares of its common stock at a weighted-average price of $11.27 per share for a total of $50.7 million. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
Policy Text Blocks | |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts of Ironwood and its wholly-owned subsidiaries, as of December 31, 2021, Ironwood Pharmaceuticals Securities Corporation and Ironwood Pharmaceuticals GmbH. Cyclerion Therapeutics, Inc. (“Cyclerion”) was a wholly-owned subsidiary until it became an independent publicly-traded company on April 1, 2019 (Note 3). All intercompany transactions and balances are eliminated in consolidation. |
Segment Information | Segment Information Operating segments are components of an enterprise for which separate financial information is available and is evaluated regularly by the Company’s chief operating decision-maker in deciding how to allocate resources and in assessing performance. The Company currently operates in one reportable business segment—human therapeutics. |
Reclassifications | Reclassifications Certain prior period financial statement items have been reclassified to conform to current period presentation. |
Discontinued Operations | Discontinued Operations The Company determined that its soluble guanylate cyclase (“sGC”) business, which was disposed on April 1, 2019, met the criteria for classification as a discontinued operation in accordance with Accounting Standards Codification (“ASC”) Subtopic 205-20, Discontinued Operations Cyclerion Separation |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in accordance with U.S. generally accepted accounting principles requires the Company’s management to make estimates and judgments that may affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the amounts of revenues and expenses during the reported periods. On an ongoing basis, the Company’s management evaluates its estimates, judgments and methodologies. Significant estimates and assumptions in the consolidated financial statements include those related to revenue recognition; accounts receivable; useful lives of long-lived assets, impairment of long-lived assets, including goodwill; valuation procedures for right-of-use assets and operating lease liabilities; valuation procedures for the issuance and repurchase of convertible notes; balance sheet classification of convertible notes; fair value of derivatives; income taxes, including the valuation allowance for deferred tax assets; research and development expenses; contingencies and share-based compensation. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results may differ materially from these estimates under different assumptions or conditions. Changes in estimates are reflected in reported results in the period in which they become known. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investment instruments with a remaining maturity when purchased of three months or less to be cash equivalents. Investments qualifying as cash equivalents primarily consist of money market funds, U.S. government-sponsored securities, and repurchase agreements. The carrying amount of cash equivalents approximates fair value. The amount of cash equivalents included in cash and cash equivalents was $595.2 million and $349.0 million at December 31, 2021 and 2020, respectively. |
Restricted Cash | Restricted Cash The Company is contingently liable under unused letters of credit with a bank, related to the Company’s facility lease and vehicle lease agreements, in the amount of $1.7 million and $2.2 million as of December 31, 2021 and 2020, respectively. The Company records as restricted cash the collateral used to secure these letters of credit. The amount of restricted cash included in current assets and non-current assets was $1.3 million and $0.5 million, respectively, at December 31, 2021. The amount of restricted cash in current assets and non-current assets was $1.7 million and $0.5 million, respectively, at December 31, 2020. |
Concentrations of Suppliers | Concentrations of Suppliers The Company relies on its collaboration partners and their suppliers to manufacture linaclotide API, linaclotide finished drug product, and finished goods. If any of the Company’s collaboration partners and their suppliers were to limit or terminate production or otherwise fail to meet the quality or delivery requirements needed to satisfy the supply commitments, the process of locating and qualifying alternate sources could require up to several months, during which time production could be delayed. Such delays could have a material adverse effect on the Company’s business, financial position and results of operations. |
Accounts Receivable and Related Valuation Account | Accounts Receivable and Related Valuation Account The Company makes judgments as to its ability to collect outstanding receivables and provides an allowance for credit losses when collection becomes doubtful. Provisions are made based upon a specific review of all significant outstanding invoices and the overall quality and age of those invoices not specifically reviewed. The Company’s receivables relate primarily to amounts reimbursed under its collaboration, license and co-promotion agreements. The Company believes that credit risks associated with these partners are not significant. The Company reviews the need for an allowance for credit losses for its receivables based on various factors including payment history and historical bad debt experience. The Company had no allowance for credit losses as of December 31, 2021 or 2020. |
Concentrations of Credit Risk | Concentrations of Credit Risk Financial instruments that subject the Company to credit risk primarily consist of cash and cash equivalents, restricted cash, and accounts receivable. The Company maintains its cash and cash equivalent balances with high-quality financial institutions and the Company believes that such funds are subject to minimal credit risk. The Company has adopted an investment policy which limits the amounts the Company may invest in certain types of investments, and requires all investments held by the Company to be at least AA- rated, thereby reducing credit risk exposure. Accounts receivable primarily consist of amounts due under the linaclotide collaboration agreement with AbbVie for North America (Note 5). The Company does not obtain collateral for its accounts receivable. The Company previously reflected amounts due from Allergan, net of amounts payable to Allergan, prior to its acquisition by AbbVie as related party accounts receivable, net. Following the acquisition of Allergan by AbbVie, the Company determined that AbbVie is not a related party to the Company (Note 16). The percentages of revenue recognized from significant collaborative partners of the Company in the years ended December 31, 2021, 2020 and 2019 as well as the account receivable balances, net of any payables due, at December 31, 2021 and 2020 are included in the following table: Accounts Receivable Revenue December 31, Year Ended December 31, 2021 2020 2021 2020 2019 Collaborative Partner: AbbVie (North America and Europe) 81 % 76 % 98 % 96 % 78 % Astellas (Japan) 1 % 1 % 1 % 1 % 13 % |
Property and Equipment | Property and Equipment Property and equipment, including leasehold improvements, are recorded at cost, and are depreciated when placed into service using the straight-line method based on their estimated useful lives as follows: Estimated Useful Life Asset Description (In Years) Laboratory equipment 5 Computer and office equipment 3 Furniture and fixtures 7 Software 3 Included in property and equipment are certain costs of software obtained for internal use. Costs incurred during the preliminary project stage are expensed as incurred, while costs incurred during the application development stage are capitalized and amortized over the estimated useful life of the software. The Company also capitalizes costs related to specific upgrades and enhancements when it is probable the expenditures will result in additional functionality. Maintenance and training costs related to software obtained for internal use are expensed as incurred. Leasehold improvements are amortized over the shorter of the estimated useful life of the asset or the lease term. Costs for capital assets not yet placed into service have been capitalized as construction in process, and will be depreciated in accordance with the above guidelines once placed into service. Maintenance and repair costs are expensed as incurred. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company regularly reviews the carrying amount of its long-lived assets to determine whether indicators of impairment may exist, which warrant adjustments to carrying values or estimated useful lives. If indications of impairment exist, projected future undiscounted cash flows associated with the asset are compared to the carrying amount to determine whether the asset’s value is recoverable. If the carrying value of the asset exceeds such projected undiscounted cash flows, the asset will be written down to its estimated fair value. |
Income Taxes | Income Taxes The Company provides for income taxes under the asset and liability method. Deferred tax assets and liabilities are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates in effect when the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to reflect the uncertainty associated with their ultimate realization. The Company accounts for uncertain tax positions recognized in the consolidated financial statements in accordance with the provisions of ASC Topic 740, Income Taxes |
Financing Costs | Financing Costs Financing costs include costs directly attributable to the Company’s offerings of its equity securities and its debt financings. Costs attributable to equity offerings are charged as a reduction to stockholders’ equity against the proceeds of the offering once the offering is completed. Costs attributable to debt financings are deferred and amortized to interest expense over the term of the debt using the effective interest method. Costs incurred in connection with convertible debt securities are allocated between the liability and equity components. In accordance with ASC 835, Interest |
Leases | Leases Effective January 1, 2019, the Company adopted ASC Topic 842, Leases optional transition method As part of the ASC 842 adoption, the Company elected certain practical expedients, which include: ● Accounting policy election to use the short-term lease exception by asset class; and ● Election of the practical expedient package during transition, which includes: o An entity need not reassess whether any expired or existing contracts are or contain leases. o An entity need not reassess the classification for any expired or existing leases. As a result, all leases that were classified as operating leases in accordance with ASC 840 are classified as operating leases under ASC 842, and all leases that were classified as capital leases in accordance with ASC 840 are classified as finance leases under ASC 842. o An entity need not reassess initial direct costs for any existing leases. Subsequent to the Company’s adoption of ASC 842, the Company elected the post-transition practical expedient, by class of underlying asset, to account for lease components and non-lease components together as a single component for the asset class of operating lease right-of-use real estate assets. The Company’s lease portfolio for the year ended December 31, 2021 included: a lease for its headquarters location, a data center colocation lease, vehicle leases for its salesforce representatives, and leases for computer and office equipment. The Company determines if an arrangement is a lease at the inception of the contract. The asset component of the Company’s operating leases is recorded as operating lease right-of-use assets, and the liability component is recorded as current portion of operating lease liabilities and operating lease liabilities, net of current portion in the Company’s consolidated balance sheets. As of December 31, 2021, the Company did not record any finance leases. Right-of-use assets and operating lease liabilities are recognized based on the present value of lease payments over the lease term at the lease inception date. Existing leases in the Company’s lease portfolio as of the adoption date were valued as of January 1, 2019. The Company uses an incremental borrowing rate based on the information available at lease inception in determining the present value of lease payments, if an implicit rate of return is not provided with the lease contract. Operating lease right-of-use assets are adjusted for incentives expected to be received. Right-of-use assets and operating lease liabilities are remeasured upon certain modifications to leases using the present value of remaining lease payments and estimated incremental borrowing rate upon lease modification. Lease cost is recognized on a straight-line basis over the lease term, and includes amounts related to short-term leases. The Company recognizes variable lease payments as operating expenses in the period in which the obligation for those payments is incurred. Variable lease payments primarily include common area maintenance, utilities, real estate taxes, insurance, and other operating costs that are passed on from the lessor in proportion to the space leased by the Company. |
Derivative Assets and Liabilities | Derivative Assets and Liabilities In June 2015, the Company issued Convertible Senior Notes due 2026 (the “2026 Convertible Notes”, and together with the 2022 Convertible Notes and the 2024 Convertible Notes, the “Convertible Senior Notes”). I Derivatives and Hedging These derivatives are recorded as assets or liabilities at fair value each reporting date and the fair value is determined using the Black-Scholes option-pricing model. The changes in fair value are recorded as a component of other (expense) income in the consolidated statements of income. Significant inputs used to determine the fair value as of December 31, 2021 included the price per share of the Company’s Class A Common Stock, expected terms of the derivative instruments, strike prices of the derivative instruments, risk-free interest rates, and expected volatility of the Company’s Class A Common Stock. Changes to these inputs could materially affect the valuation of the Convertible Note Hedges and Note Hedge Warrants. In August 2019, in connection with the issuance of the 2024 Convertible Notes and the 2026 Convertible Notes, the Company entered into the Capped Calls. The Capped Calls cover the same number of shares of Class A Common Stock that initially underlie the 2024 Convertible Notes and the 2026 Convertible Notes (subject to anti-dilution and certain other adjustments). These instruments meet the conditions outlined in ASC 815 to be classified in stockholders’ equity (deficit) and are not subsequently remeasured as long as the conditions for equity classification continue to be met. |
Share Repurchases | Share Repurchases The Company accounts for repurchases of its Class A Common Stock on the trade date by recording the excess of the repurchase price over the par value entirely to additional paid-in capital. All repurchased shares are retired or constructively retired. Issued and outstanding shares are reduced by shares repurchased. |
Revenue Recognition | Revenue Recognition The Company’s revenues are generated primarily through collaborative arrangements and license agreements related to the research and development and commercialization of linaclotide, as well as co-promotion arrangements in the U.S. The terms of the collaborative research and development, license, co-promotion and other agreements contain multiple performance obligations which may include (i) licenses, (ii) research and development activities, including participation on joint steering committees, (iii) the manufacture of finished drug product, API, or development materials for a partner, which are reimbursed at a contractually determined rate, and (iv) education or co-promotion activities by the Company’s clinical sales specialists. Non-refundable payments to the Company under these agreements may include (i) up-front license fees, (ii) payments for research and development activities, (iii) payments for the manufacture of finished drug product, API, or development materials, (iv) payments based upon the achievement of certain milestones, (v) payments for sales detailing, promotional support services and medical education initiatives, and (vi) royalties on product sales. The Company receives its share of the net profits or bears its share of the net losses from the sale of linaclotide in the U.S. through its collaboration agreement with AbbVie for North America. The Company has adopted a policy to recognize revenue net of tax withholdings, as applicable. Collaboration, License, Co-Promotion and Other Commercial Agreements Upon licensing intellectual property to a customer, the Company determines if the license is distinct from the other performance obligations identified in the arrangement. The Company recognizes revenues from the transaction price, including non-refundable, up-front fees allocated to the license when the license is transferred to the customer if the license has distinct benefit to the customer. For licenses that are combined with other promises, the Company assesses the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time. For performance obligations that are satisfied over time, the Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. The Company’s license and collaboration agreements include milestone payments, such as development and other milestones. The Company evaluates whether the milestones are considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method at the inception of the agreement. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the control of the Company, such as regulatory approvals, are not considered probable of being achieved until those approvals are received. The transaction price is then allocated to each performance obligation on a relative standalone selling price basis, for which the Company recognizes revenue as or when the performance obligations under the contract are satisfied. The Company re-evaluates the probability of achievement of such milestones and any related constraint at each reporting period, and any adjustments are recorded on a cumulative catch-up basis. Agreements that include the supply of API or drug product for either clinical development or commercial supply at the customer’s discretion are generally considered as options. The Company assesses if these options provide a material right to its partner, and if so, they are accounted for as separate performance obligations. If the Company is entitled to additional payments when the customer exercises these options, any additional payments are recorded as revenue when the customer obtains control of the goods, which is typically upon shipment for sales of API and finished drug product. For agreements that include sales-based royalties, including milestone payments based on the level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue when the related sales occur. Net Profit or Net Loss Sharing In accordance with ASC 808 Topic, Collaborative Arrangements Revenue from Contracts with Customers The Company’s collaborative arrangements revenues generated from sales of LINZESS in the U.S. are considered akin to sales-based royalties. In accordance with the sales-based royalty exception, the Company recognizes its share of the pre-tax commercial net profit or net loss generated from the sales of LINZESS in the U.S. in the period the product sales are earned, as reported by AbbVie, and related cost of goods sold and selling, general and administrative expenses as incurred by the Company and AbbVie. These amounts are partially determined based on amounts provided by AbbVie and involve the use of estimates and judgments, such as product sales allowances and accruals related to prompt payment discounts, chargebacks, governmental and contractual rebates, wholesaler fees, product returns, and co-payment assistance costs, which could be adjusted based on actual results in the future. The Company is highly dependent on AbbVie for timely and accurate information regarding net revenues from sales of LINZESS in the U.S. in accordance with both ASC 808 and ASC 606, and the related costs, in order to accurately report its results of operations. If the Company does not receive timely and accurate information or incorrectly estimates activity levels associated with the collaboration at a given point in time, the Company could be required to record adjustments in future periods. In accordance with ASC 606-10-55, Principal Agent Considerations Sale of Active Pharmaceutical Ingredient During the years ended December 31, 2020, and 2019, the Company produced linaclotide API, finished drug product, finished goods, and/or development materials for certain of its partners. As of December 31, 2020, the Company was no longer responsible for the supply of linaclotide API, finished drug product, finished goods or development materials to its partners, though the Company may provide development materials to certain of our partners on a periodic basis. Sales of such development materials have been and are expected to continue to be immaterial. The Company recognizes revenue on linaclotide API, finished drug product, finished goods, and development materials when control has transferred to the partner, which generally occurs upon shipment after the material passed all quality testing required for acceptance by the partner. Prior to the execution of the Amended AstraZeneca Agreement in September 2019, any linaclotide API, finished drug product, and development materials produced for AstraZeneca for China (including Hong Kong and Macau) were recognized in accordance with the cost-sharing provisions of the AstraZeneca collaboration agreement. Other The Company’s deferred revenue balance consists of advance billings and payments received from customers in excess of revenue recognized. |
Cost of Revenues | Cost of Revenues Cost of revenues includes cost related to the sales of linaclotide API, finished drug product, and finished goods and are generally recognized upon shipment to certain of the Company’s partners outside of the U.S. The Company’s cost of revenues for linaclotide consists of the internal and external costs of producing such API, finished drug product, and finished goods. |
Research and Development Costs | Research and Development Costs The Company generally expenses research and development costs to operations as incurred. The Company capitalizes nonrefundable advance payments made by the Company for research and development activities and defers expense recognition until the related goods are received or the related services are performed. Research and development expenses are comprised of costs incurred in performing research and development activities, including salary, benefits, share-based compensation, and other employee-related expenses; laboratory supplies and other direct expenses; facilities expenses; overhead expenses; third-party contractual costs relating to nonclinical studies and clinical trial activities and related contract manufacturing expenses, development of manufacturing processes and regulatory registration of third-party manufacturing facilities; licensing fees for the Company’s product candidates; and other outside expenses. The Company has certain collaboration agreements pursuant to which it shares or has shared research and development expenses related to linaclotide. The Company records expenses incurred under such linaclotide collaboration arrangements as research and development expense. Prior to the execution of the Amended AstraZeneca Agreement in September 2019, under the Company’s collaboration agreement with AstraZeneca for China (including Hong Kong and Macau), the Company was reimbursed for certain research and development expenses and it netted these reimbursements against its research and development expenses as incurred. In connection with the execution of the Amended AstraZeneca Agreement, AstraZeneca is fully responsible for all research and development costs incurred related to the development, manufacture, and commercialization of linaclotide in China (including Hong Kong and Macau). Under the Company’s collaboration agreement with AbbVie for North America, the Company is reimbursed for certain research and development expenses and nets these reimbursements against its research and development expenses as incurred. Research and development expense includes up-front payment, non-contingent payment, and milestone payment obligations under the COUR Collaboration Agreement (Note 5). Expense is recognized when the obligation is determined to be probable. |
Restructuring Expenses | Restructuring Expenses Restructuring expenses are comprised primarily of costs associated with exit and disposal activities in accordance with ASC 420, Exit or Disposal Cost Obligations |
Selling, General and Administrative Expenses | Selling, General and Administrative Expenses The Company expenses selling, general and administrative costs to operations as incurred. Selling, general and administrative expenses consist primarily of compensation, benefits and other employee-related expenses for personnel in the Company’s administrative, finance, legal, information technology, business development, commercial, sales, marketing, communications and human resources functions. Other costs include the legal costs of pursuing patent protection of the Company’s intellectual property, general and administrative related facility costs, insurance costs and professional fees for accounting, tax, consulting, legal and other services. Prior to the execution of the Amended AstraZeneca Agreement, the Company was reimbursed for certain selling, general and administrative expenses and the Company netted these reimbursements against the Company’s selling, general and administrative expenses as incurred. In connection with the Amended AstraZeneca Agreement, effective in September 2019, AstraZeneca is fully responsible for all costs related to the development, manufacture, and commercialization of linaclotide in China (including Hong Kong and Macau). The Company includes AbbVie’s selling, general and administrative cost-sharing payments in the calculation of the net profits and net losses from the sale of LINZESS in the U.S. and presents the net payment to or from AbbVie as collaboration expense or collaborative arrangements revenue, respectively. |
Share-Based Compensation Expense | Share-Based Compensation Expense The Company grants awards under its share-based compensation programs, including stock awards, restricted stock awards (“RSAs”), restricted stock units (“RSUs”) (including both time-based and performance-based RSUs), stock options, and shares issued under the Company’s employee stock purchase plan (“ESPP”). Share-based compensation is recognized as expense in the consolidated statements of income based on the grant date fair value over the requisite service period, net of estimated forfeitures. The Company estimates forfeitures over the requisite service period using historical forfeiture activity and records share-based compensation expense only for those awards that are expected to vest. The Company estimates the fair value of stock options using the Black-Scholes option-pricing model, which requires the use of subjective assumptions including volatility and expected term, among others. The fair value of stock awards, RSAs, and RSUs is based on the market value of the Company’s Class A Common Stock on the date of grant, with the exception of performance-based RSUs with market conditions, which are measured using the Monte Carlo simulation method on the date of grant (Note 13). Discounted stock purchases under the Company’s ESPP are valued on the first date of the offering period using the Black-Scholes option-pricing model to compute the fair value of the lookback provision plus the purchase discount. For awards that vest based on service conditions and market conditions, the Company uses a straight-line method to recognize compensation expense over the respective service period. For awards that contain performance conditions, the Company determines the appropriate amount to expense at each reporting date based on the anticipated achievement of performance targets, which requires judgement, including forecasting the achievement of future specified targets. At the date performance conditions are determined to be probable of achievement, the Company records a cumulative expense catch-up, with remaining expense amortized over the remaining service period. Throughout the performance period, the Company re-assesses the estimated performance and updates the number of performance-based awards that it believes will ultimately vest. Discounted stock purchases under the Company’s ESPP are recognized over the offering period. Compensation expense related to modified awards is measured based on the fair value for the awards as of the modification date. Any incremental compensation expense arising from the excess of the fair value of the awards on the modification date compared to the fair value of the awards immediately before the modification date is recognized at the modification date or ratably over the requisite remaining service period, as appropriate. While the assumptions used to calculate and account for share-based compensation awards represent management’s best estimates, these estimates involve inherent uncertainties and the application of management’s judgment. As a result, if revisions are made to the Company’s underlying assumptions and estimates, the Company’s share-based compensation expense could vary significantly from period to period. |
Patent Costs | Patent Costs The Company incurred and recorded as operating expense legal and other fees related to patents of $1.7 million, $2.3 million, and $7.8 million for the years ended December 31, 2021, 2020 and 2019, respectively. These costs were charged to selling, general and administrative expenses as incurred. |
Net Income Per Share | Net Income Per Share Basic net income per common share is computed by dividing the net income by the weighted average number of common shares outstanding during the period. Diluted net income per common share is computed by dividing net income by the diluted number of shares outstanding during the period. Except where the result would be antidilutive to net income, diluted net income per common share is computed assuming the conversion of the 2022 Convertible Notes, the 2024 Convertible Notes and the 2026 Convertible Notes, the exercise of outstanding common stock options and the vesting of RSUs and RSAs (using the treasury stock method), as well as their related income tax effects. |
Subsequent Events | Subsequent Events The Company considers events or transactions that have occurred after the balance sheet date of December 31, 2021, but prior to the filing of the financial statements with the Securities and Exchange Commission (“SEC”) to provide additional evidence relative to certain estimates or to identify matters that require additional recognition or disclosure. Subsequent events have been evaluated through the filing of the financial statements accompanying this Annual Report on Form 10-K. |
New Accounting Pronouncements | New Accounting Pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (the “FASB”) or other standard setting bodies that are adopted by the Company as of the specified effective date. Except as set forth below, the Company did not adopt any new accounting pronouncements during the year ended December 31, 2021 that had a material effect on its consolidated financial statements. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes , March 31 , 2021 In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging— Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity In May 2021, the FASB issued ASU No. 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options Other recent accounting pronouncements issued, but not yet effective, are not expected to be applicable to the Company or have a material effect on the consolidated financial statements upon future adoption. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Table Text Blocks | |
Schedule of percentages of revenue and accounts receivable recognized from significant customers | Accounts Receivable Revenue December 31, Year Ended December 31, 2021 2020 2021 2020 2019 Collaborative Partner: AbbVie (North America and Europe) 81 % 76 % 98 % 96 % 78 % Astellas (Japan) 1 % 1 % 1 % 1 % 13 % |
Schedule of property and equipment | Estimated Useful Life Asset Description (In Years) Laboratory equipment 5 Computer and office equipment 3 Furniture and fixtures 7 Software 3 Property and equipment, net consisted of the following (in thousands): December 31, 2021 2020 Software $ 5,667 $ 8,615 Leasehold improvements 7,407 7,407 Laboratory equipment 1,327 1,898 Furniture and fixtures 1,517 1,517 Computer and office equipment 1,285 1,297 Total property and equipment 17,203 20,734 Less accumulated depreciation and amortization (9,628) (11,805) Total property and equipment, net $ 7,575 $ 8,929 |
Cyclerion Separation (Tables)
Cyclerion Separation (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Table Text Blocks | |
Summary of assets and liabilities transferred in separation | As of April 1, 2019 Assets: Prepaid expenses and other current assets $ 1,169 Property and equipment, net 10,241 Other assets 21 $ 11,431 Liabilities: Accrued research and development costs $ 5,673 Accrued expenses and other current liabilities 3,149 $ 8,822 Net Assets Transferred to Cyclerion $ 2,609 |
Summary of the discontinued operations | Year Ended December 31, 2019 Costs and expenses: Research and development $ 21,792 Selling, general and administrative 15,646 Net loss from discontinued operations $ 37,438 |
Net Income Per Share (Tables)
Net Income Per Share (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Table Text Blocks | |
Schedule of computation of basic and diluted net loss per common share | The following table sets forth the computation of basic and diluted net income per common share (in thousands, except per share amounts): Year Ended December 31, 2021 2020 2019 Numerator: Net income $ 528,448 $ 106,176 $ 21,505 Denominator: Weighted average number of common shares outstanding used in computing net income per share — basic 162,245 159,427 156,023 Effect of dilutive securities: Stock options 488 367 — Time-based restricted stock units 1,422 766 — Performance-based restricted stock units 146 1 — Restricted stock 117 94 — Dilutive potential common shares Weighted average number of common shares outstanding used in computing net income per share — diluted 164,418 160,655 156,023 Net income per share — basic 3.26 0.67 0.14 Net income per share — diluted $ 3.21 $ 0.66 $ 0.14 |
Schedule of potentially dilutive securities that have been excluded from computation of diluted weighted average shares outstanding | The outstanding securities have been excluded from the computation of diluted weighted average shares outstanding, as applicable, as their effect would be anti-dilutive (in thousands): Year Ended December 31, 2021 2020 2019 Stock options 7,701 11,746 17,194 Restricted stock awards — 2 182 Time-based restricted stock units 102 209 3,207 Performance-based restricted stock units 121 93 — Note Hedge Warrants 8,318 8,318 8,318 2022 Convertible Notes 8,318 8,318 8,318 2024 Convertible Notes 14,934 14,934 14,934 2026 Convertible Notes 14,934 14,934 14,934 Total 54,428 58,554 67,087 |
Collaboration, License, and O_2
Collaboration, License, and Other Agreements (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Table Text Blocks | |
Schedule of revenue attributable to transactions from collaboration and license arrangements | Year Ended December 31, Collaborative Arrangements Revenue 2021 2020 2019 Linaclotide Collaboration and License Agreements: AbbVie (North America) $ 403,085 $ 370,902 $ 327,591 AbbVie (Europe and other) 2,558 2,196 1,718 AstraZeneca (China, including Hong Kong and Macau) 743 682 32,628 Astellas (Japan) 2,232 2,128 10,147 Co-Promotion and Other Agreements: AbbVie (VIBERZI) (1) — — 3,723 Alnylam (GIVLAARI) 2,411 4,302 2,000 Other 1,755 1,335 1,845 Total collaborative arrangements revenue $ 412,784 $ 381,545 $ 379,652 Sale of API Linaclotide Agreements: Astellas (Japan) $ 149 $ 2,017 $ 45,788 AstraZeneca (China, including Hong Kong and Macau) 597 5,540 2,973 Other 223 421 — Total sale of API $ 969 $ 7,978 $ 48,761 (1) The Company had an agreement with AbbVie to perform sales detailing activities for VIBERZI® (eluxadoline) which terminated as of December 31, 2019. |
AbbVie | |
Table Text Blocks | |
Schedule of revenue attributable to transactions from collaboration and license arrangements | The Company recognized collaborative arrangements revenue from the AbbVie collaboration agreement for North America during the years ended December 31, 2021, 2020, and 2019 as follows (in thousands): Year Ended December 31, 2021 2020 2019 Collaborative arrangements revenue related to sales of LINZESS in the U.S. $ 400,371 $ 368,603 $ 325,429 Royalty revenue 2,714 2,299 2,162 Total collaborative arrangements revenue $ 403,085 $ 370,902 $ 327,591 |
Schedule of amount recorded by the Company for share of net loss related to collaborative arrangement | |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Table Text Blocks | |
Schedule of assets and liabilities measured at fair value on a recurring basis | The following tables present the assets and liabilities the Company has measured at fair value on a recurring basis (in thousands): Fair Value Measurements at Reporting Date Using Quoted Prices in Significant Other Significant Active Markets for Observable Unobservable December 31, Identical Assets Inputs Inputs 2021 (Level 1) (Level 2) (Level 3) Assets: Cash and cash equivalents: Money market funds $ 595,233 $ 595,233 $ — $ — Restricted cash: Money market funds 1,735 1,735 — — Convertible note hedges 1,115 — — 1,115 Total assets measured at fair value $ 598,083 $ 596,968 $ — $ 1,115 Liabilities: Note hedge warrants $ 1,316 $ — $ — $ 1,316 Total liabilities measured at fair value $ 1,316 $ — $ — $ 1,316 Fair Value Measurements at Reporting Date Using Quoted Prices in Significant Other Significant Active Markets for Observable Unobservable December 31, Identical Assets Inputs Inputs 2020 (Level 1) (Level 2) (Level 3) Assets: Cash and cash equivalents: Money market funds $ 349,014 $ 349,014 $ — $ — Restricted cash: Money market funds 2,221 2,221 — — Convertible note hedges 13,065 — — 13,065 Total assets measured at fair value $ 364,300 $ 351,235 $ — $ 13,065 Liabilities: Note hedge warrants $ 12,088 $ — $ — $ 12,088 Total liabilities measured at fair value $ 12,088 $ — $ — $ 12,088 |
Schedule of assumptions used in fair market valuations | The following inputs were used in the fair market valuation of the Convertible Note Hedges and Note Hedge Warrants as of December 31, 2021 and 2020: Year Ended Year Ended December 31, 2021 December 31, 2020 Convertible Note Hedge Convertible Note Hedge Note Hedges Warrants Note Hedges Warrants Risk-free interest rate (1) 0.2 % 0.4 % 0.1 % 0.1 % Expected term 0.5 1.0 1.5 2.0 Stock price (2) $ 11.66 $ 11.66 $ 11.39 $ 11.39 Strike price (3) $ 14.51 $ 18.82 $ 14.51 $ 18.82 Common stock volatility (4) 27.0 % 32.2 % 46.7 % 50.3 % Dividend yield (5) — % — % — % — % (1) Based on U.S. Treasury yield curve, with terms commensurate with the expected terms of the Convertible Note Hedges and the Note Hedge Warrants. (2) The closing price of the Company’s Class A Common Stock on the last trading days of the years ended December 31, 2021 and 2020, respectively. (3) As per the respective agreements for the Convertible Note Hedges and Note Hedge Warrants. (4) Expected volatility based on historical volatility of the Company’s Class A Common Stock. (5) The Company has not paid and does not anticipate paying cash dividends on its shares of common stock in the foreseeable future; therefore, the expected dividend yield is assumed to be zero . |
Schedule of the change in Level 3 convertible note derivatives | The following table reflects the change in the Company's Level 3 Convertible Note Hedges and Note Hedge Warrants from December 31, 2019 through December 31, 2021 (in thousands): Convertible Note Hedge Note Hedges Warrants Balance at December 31, 2019 $ 31,366 $ (24,260) Change in fair value, recorded as a component of (loss) gain on derivatives (18,301) 12,172 Balance at December 31, 2020 $ 13,065 $ (12,088) Change in fair value, recorded as a component of (loss) gain on derivatives (11,950) 10,772 Balance at December 31, 2021 $ 1,115 $ (1,316) |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Table Text Blocks | |
Schedule of components of lease cost and supplemental cash flow information | Year Ended December 31, 2021 2020 2019 Operating lease cost (1) $ 2,520 $ 2,530 $ 16,452 Variable lease payments — — 1,526 Short-term lease cost 960 1,420 1,512 Total lease cost $ 3,480 $ 3,950 $ 19,490 (1) Operating lease cost is presented net of $0.3 million of sublease income for the year ended December 31, 2019 related to a sublease agreement between Ironwood and Cyclerion executed upon Separation. The sublease agreement terminated in May 2019. Supplemental information related to leases for the periods reported is as follows: Year Ended December 31, 2021 2020 2019 Right-of-use assets obtained in exchange for new operating lease upon adoption of ASC 842 (in thousands) $ — $ — $ 88,299 Adjustment to right-of-use assets as a result of the lease modification upon Separation (in thousands) — — (40,427) Adjustment to right-of-use assets as a result of the termination of the Binney Street Lease (in thousands) — — (34,440) Right-of-use assets obtained in exchange for new operating lease liabilities upon execution of Summer Street Lease (in thousands) — — 18,452 Cash paid for amounts included in the measurement of lease liabilities (in thousands) $ 3,128 $ 1,146 $ 18,598 Weighted-average remaining lease term of operating leases (in years) 8.3 9.3 10.2 Weighted-average discount rate of operating leases 5.8 % 5.8 % 5.8 % |
Schedule of future minimum lease payments under non-cancelable operating leases | Future minimum lease payments under non-cancelable operating leases as of December 31, 2021 are as follows (in thousands): 2022 $ 3,129 2023 3,065 2024 3,126 2025 3,189 2026 3,252 2027 and thereafter 11,603 Total future minimum lease payments 27,364 Less: present value adjustment (5,753) Operating lease liabilities 21,611 Less: current portion of operating lease liabilities (3,127) Operating lease liabilities, net of current portion $ 18,484 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Table Text Blocks | |
Schedule of property and equipment | Estimated Useful Life Asset Description (In Years) Laboratory equipment 5 Computer and office equipment 3 Furniture and fixtures 7 Software 3 Property and equipment, net consisted of the following (in thousands): December 31, 2021 2020 Software $ 5,667 $ 8,615 Leasehold improvements 7,407 7,407 Laboratory equipment 1,327 1,898 Furniture and fixtures 1,517 1,517 Computer and office equipment 1,285 1,297 Total property and equipment 17,203 20,734 Less accumulated depreciation and amortization (9,628) (11,805) Total property and equipment, net $ 7,575 $ 8,929 |
Accrued Expenses and Other Cu_2
Accrued Expenses and Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Table Text Blocks | |
Schedule of accrued expenses and other current liabilities | Accrued expenses and other current liabilities consisted of the following (in thousands): December 31, 2021 2020 Accrued compensation and benefits $ 16,653 13,413 Restructuring liabilities 462 10,510 Stock repurchase 3,009 — Other 3,442 2,563 Total accrued expenses and other current liabilities $ 23,566 $ 26,486 |
Notes Payable (Tables)
Notes Payable (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Table Text Blocks | |
Schedule of outstanding Convertible Note | The Company’s outstanding balances for the convertible senior notes as of December 31, 2021 and 2020 consisted of the following (in thousands): December 31, 2021 2020 Liability component: Principal: 2022 Convertible Notes $ 120,699 $ 120,699 2024 Convertible Notes 200,000 200,000 2026 Convertible Notes 200,000 200,000 Less: unamortized debt discount (61,641) (83,900) Less: unamortized debt issuance costs (4,867) (6,543) Net carrying amount $ 454,191 $ 430,256 Equity component: 2022 Convertible Notes 19,807 19,807 2024 Convertible Notes 41,152 41,152 2026 Convertible Notes 51,350 51,350 Total equity component $ 112,309 $ 112,309 |
Schedule of interest expense related to Convertible Notes | Year Ended December 31, 2021 2020 2019 Contractual interest expense $ 7,216 $ 7,216 $ 7,361 Amortization of debt issuance costs 1,678 1,462 1,190 Amortization of debt discount 22,256 20,800 17,683 Total interest expense $ 31,150 $ 29,478 $ 26,234 |
Schedule of future minimum payments details of debt | 2022 $ 126,557 2023 4,500 2024 203,750 2025 3,000 2026 201,500 Total future minimum payments under the convertible senior notes 539,307 Less: amounts representing interest (18,608) Less: unamortized debt discount (61,641) Less: unamortized debt issuance costs (4,867) Convertible senior notes balance $ 454,191 |
Employee Stock Benefit Plans (T
Employee Stock Benefit Plans (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Table Text Blocks | |
Summary of expense recognized for share-based compensation arrangements | The following table summarizes share-based compensation expense by award type (in thousands): Year Ended December 31, 2021 2020 2019 Stock options $ 3,154 $ 7,680 $ 12,526 Time-based restricted stock units 14,539 18,624 15,488 Performance-based restricted stock units 1,295 2,190 — Restricted stock awards 2,684 1,886 2,095 Employee stock purchase plan 419 722 1,115 Stock awards 190 73 54 Total share-based compensation expense $ 22,281 $ 31,175 $ 31,278 |
Share-based compensation expense reflected in the condensed consolidated statements of operations | Year Ended December 31, 2021 2020 2019 Stock options $ 3,154 $ 7,680 $ 12,526 Time-based restricted stock units 14,539 18,624 15,488 Performance-based restricted stock units 1,295 2,190 — Restricted stock awards 2,684 1,886 2,095 Employee stock purchase plan 419 722 1,115 Stock awards 190 73 54 Total share-based compensation expense $ 22,281 $ 31,175 $ 31,278 |
Schedule of weighted-average assumptions used to estimate the fair value of Relative TSR PSUs | Year Ended December 31, 2021 Fair value of common stock $ 11.39 Expected volatility 47.9 % Expected term (in years) 2.6 Risk-free interest rate 0.3 % Expected dividend yield — % |
Summary of restricted stock activity | Weighted- Average Number of Grant Date Shares Fair Value Unvested as of December 31, 2020 246,500 $ 10.38 Granted 230,160 11.67 Vested (213,400) 11.58 Forfeited — — Unvested as of December 31, 2021 263,260 $ 11.61 |
Schedule of weighted-average assumptions used to estimate the fair value of the stock options using the Black-Scholes option-pricing model | Year Ended December 31, 2020 2019 Expected volatility 46.6 % 46.3 % Expected term (in years) 6.1 6.1 Risk-free interest rate 1.5 % 2.5 % Expected dividend yield — % — % |
Summary of stock option activity | Weighted- Weighted- Number of Average Average Aggregate Stock Exercise Contractual Intrinsic Options Price (1) Life Value (in years) (in thousands) Outstanding at December 31, 2020 13,459,671 $ 12.25 4.27 $ 5,613 Granted — — — — Exercised (1,698,362) 10.83 — — Cancelled (2,388,515) 13.07 — — Outstanding at December 31, 2021 9,372,794 12.30 3.51 4,528 Vested or expected to vest at December 31, 2021 9,331,488 12.31 3.49 4,509 Exercisable at December 31, 2021 8,972,651 12.33 3.38 4,385 (1) Exercise prices relating to stock options granted prior to the Separation have not been adjusted to reflect the effect of the Separation on the stock options. |
Schedule of unrecognized share-based compensation expense, net of estimated forfeitures by type of awards and weighted-average period | Unrecognized Weighted-Average Expense, Net Remaining of Estimated Recognition Forfeitures Period (in thousands) (in years) Type of award: Stock options with time-based vesting $ 1,541 1.14 Restricted stock awards 1,464 0.60 Time-based restricted stock units 22,545 2.46 Performance-based restricted stock units 3,816 1.74 Stock options with time-based and performance-based vesting — — |
Time-based Restricted Stock Units | |
Table Text Blocks | |
Summary of RSU activity | Weighted- Average Number Grant Date of RSUs Fair Value Outstanding as of December 31, 2020 4,170,626 $ 11.90 Granted 2,707,427 10.40 Vested and released (1,697,745) 12.18 Forfeited (1,316,200) 11.38 Outstanding as of December 31, 2021 3,864,108 $ 10.89 |
Performance-based Restricted Stock Units | |
Table Text Blocks | |
Summary of RSU activity | Weighted- Average Number Grant Date of PSUs Fair Value Outstanding as of December 31, 2020 586,157 $ 12.48 Granted 661,651 14.65 Vested and released — — Forfeited (414,522) 12.76 Outstanding as of December 31, 2021 833,286 $ 14.06 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Table Text Blocks | |
Schedule of the components of the provision for (benefit from) income taxes | Year Ended December 31, 2021 2020 2019 Current: Federal $ — $ — $ — State 5,503 2,685 — Total current 5,503 2,685 — Deferred: Federal (251,367) — — State (81,927) — — Total deferred (333,294) — — Total income tax (benefit) expense $ (327,791) $ 2,685 $ — |
Reconciliation of income taxes from continuing operations computed using U.S. federal statutory rate to that reflected in operations | Year Ended December 31, 2021 2020 2019 Income tax expense (benefit) using U.S. federal statutory rate $ 42,138 $ 22,861 $ 4,517 Permanent differences 34 74 65 State income taxes, net of federal benefit 12,554 7,565 (1,902) Disallowed Separation related costs — — 4,658 Executive compensation - Section 162(m) 695 1,718 662 Meals and entertainment 349 395 495 Non-deductible share-based compensation 43 (144) (1,202) Excess tax benefits 6,270 5,132 3,324 Fair market valuation of Note Hedge Warrants and Convertible Note Hedges 325 1,680 (290) Tax credits (9) (3,149) (4,374) Expiring net operating losses and tax credits 491 1,991 3,764 Effect of change in state tax rate on deferred tax assets and deferred tax liabilities 123 (208) (2,563) Change in the valuation allowance (390,804) (35,230) (7,154) Income tax expense (benefit) $ (327,791) $ 2,685 $ — |
Schedule of components of deferred tax assets and liabilities | December 31, 2021 2020 Deferred tax assets: Net operating loss carryforwards $ 165,022 $ 234,772 Tax credit carryforwards 60,125 60,607 Capitalized research and development 4,981 7,498 Share-based compensation 16,857 21,848 Basis difference on collaboration agreement for North America with AbbVie 78,194 62,629 Accruals and reserves 5,003 6,114 Basis difference on 2022 Convertible Notes 8,166 6,183 Intangible assets 5,396 — Interest expense — 3,386 Operating lease liability 5,971 6,504 Other 3,997 5,049 Total deferred tax assets 353,712 414,590 Deferred tax liabilities: Basis difference on 2024 Convertible Notes (4,363) (5,951) Basis difference on 2026 Convertible Notes (7,597) (9,022) Operating lease right-of-use assets (4,248) (4,603) Total deferred tax liabilities (16,208) (19,576) Net deferred tax asset 337,504 395,014 Valuation allowance (4,210) (395,014) Net deferred tax asset $ 333,294 $ — |
Summary of changes in the unrecognized tax benefits | The following table summarizes the changes in the Company’s unrecognized income tax benefits for the years ended December 31, 2021, 2020, and 2019 (in thousands): Year Ended December 31, 2021 2020 2019 Balance at the beginning of the period $ 68,087 $ 53,099 $ 38,551 Increases based on tax positions related to the current period 83,206 66,687 51,699 Increases for tax positions related to prior periods — — 1,400 Decreases for tax positions in prior periods (66,687) (51,699) (38,551) Balance at the end of the period $ 84,606 $ 68,087 $ 53,099 |
Workforce Reduction and Restr_2
Workforce Reduction and Restructuring (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Table Text Blocks | |
Schedule of charges made to the reduction in field-based workforce | The following table summarizes the accrued liabilities activity recorded in connection with the reduction in workforce in September 2020 and related restructuring activities during the year ended December 31, 2021 (in thousands): Amounts Amounts Accrued at Accrued at December 31, 2020 Charges Amount Paid Adjustments December 31, 2021 Employee severance, benefits and related costs $ 10,902 $ 1,025 $ (10,611) $ (854) $ 462 Contract related costs 5 48 (53) — — Total $ 10,907 $ 1,073 $ (10,664) $ (854) $ 462 The following table summarizes the accrued liabilities activity recorded in connection with the reductions in workforce and related restructuring activities during the year ended December 31, 2020 (in thousands): Amounts Amounts Accrued at Accrued at December 31, 2019 Charges Amount Paid Adjustments December 31, 2020 Employee severance, benefits and related costs February 2019 Reduction $ 75 $ — $ (75) $ — $ — September 2020 Reduction — 11,563 (661) — 10,902 Total $ 75 $ 11,563 $ (736) $ — $ 10,902 Contract related costs August 2018 Reduction $ 104 $ — $ — $ (104) $ — September 2020 Reduction — 108 (103) — 5 Total $ 104 $ 108 $ (103) $ (104) $ 5 |
Selected Quarterly Financial _2
Selected Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Table Text Blocks | |
Selected Quarterly Financial Data (Unaudited) | First Second Third Fourth Total Quarter Quarter Quarter Quarter Year (in thousands, except per share data) 2021 Total revenues $ 88,845 $ 104,031 $ 103,747 $ 117,130 $ 413,753 Total cost and expenses 43,447 38,933 38,576 60,538 181,494 Other expense, net (5,040) (10,726) (5,499) (10,337) (31,602) Net income and comprehensive income 39,926 391,303 55,845 41,374 528,448 Net income per share—basic 0.25 2.42 0.34 0.25 3.26 Net income per share—diluted 0.25 2.39 0.34 0.25 3.21 First Second Third Fourth Total Quarter Quarter Quarter Quarter Year (in thousands, except per share data) 2020 Total revenues $ 79,943 $ 89,432 $ 103,468 $ 116,680 $ 389,523 Total cost and expenses 66,716 56,719 57,852 65,296 246,583 Other expense, net (9,882) (7,509) (9,804) (6,884) (34,079) Net income and comprehensive income 3,345 25,204 34,423 43,204 106,176 Net income per share—basic 0.02 0.16 0.22 0.27 0.67 Net income per share—diluted 0.02 0.16 0.21 0.27 0.66 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Segment Information (Details) - segment | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Segment information | |||
Number of reportable segments | 1 | 1 | 1 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Cash and Cash Equivalents (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Cash and Cash Equivalents | ||
Cash Equivalent included in cash and cash equivalent | $ 595.2 | $ 349 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Restricted Cash (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Restricted Cash [Abstract] | |||
Restricted cash | $ 1,735 | $ 2,220 | $ 2,221 |
Restricted cash, current | 1,250 | 1,735 | |
Restricted cash, noncurrent | $ 485 | $ 485 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Concentrations of Credit Risk (Details) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Accounts receivable | Accounts receivable balances | AbbVie | |||
Concentrations | |||
Concentration risk percentage (as a percent) | 81.00% | 76.00% | |
Accounts receivable | Accounts receivable balances | Astellas Pharma Inc. | |||
Concentrations | |||
Concentration risk percentage (as a percent) | 1.00% | 1.00% | |
Revenue from Contract with Customer Benchmark | Revenue | AbbVie | |||
Concentrations | |||
Concentration risk percentage (as a percent) | 98.00% | 96.00% | 78.00% |
Revenue from Contract with Customer Benchmark | Revenue | Astellas Pharma Inc. | |||
Concentrations | |||
Concentration risk percentage (as a percent) | 1.00% | 1.00% | 13.00% |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Laboratory equipment | |
Property and Equipment | |
Estimated useful life | 5 years |
Computer and office equipment | |
Property and Equipment | |
Estimated useful life | 3 years |
Furniture and fixtures | |
Property and Equipment | |
Estimated useful life | 7 years |
Software | |
Property and Equipment | |
Estimated useful life | 3 years |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies - Leases (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Leases | |
Lease, Practical Expedients, Package | true |
Lease, Practical Expedient, Lessor Single Lease Component | true |
Summary of Significant Accou_10
Summary of Significant Accounting Policies - Derivative Assets and Liabilities (Details) - Convertible Senior Notes | Sep. 16, 2019 | Aug. 12, 2019 | Jun. 30, 2015 |
2.25% Convertible Senior Notes due 2022 | |||
Notes Payable | |||
Stated interest rate (as a percent) | 2.25% | 2.25% | |
0.75% Convertible Senior Notes due 2024 | |||
Notes Payable | |||
Stated interest rate (as a percent) | 0.75% | ||
1.50% Convertible Senior Notes due 2026 | |||
Notes Payable | |||
Stated interest rate (as a percent) | 1.50% |
Summary of Significant Accou_11
Summary of Significant Accounting Policies - Revenue Recognition (Details) | 12 Months Ended |
Dec. 31, 2021 | |
U.S. | AbbVie | |
Collaboration agreements | |
Percentage of the pre-tax net profit or loss (as a percent) | 50.00% |
Summary of Significant Accou_12
Summary of Significant Accounting Policies - Patent Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Patent Costs | |||
Selling, general and administrative | $ 111,133 | $ 140,003 | $ 172,450 |
Patents | |||
Patent Costs | |||
Selling, general and administrative | $ 1,700 | $ 2,300 | $ 7,800 |
Summary of Significant Accou_13
Summary of Significant Accounting Policies - New Accounting Pronouncements (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Standards Update 2016-02 | |
New Accounting Pronouncements | |
Change in Accounting Principle, Accounting Standards Update, Adopted | true |
Change in Accounting Principle, Accounting Standards Update, Adoption Date | Jan. 1, 2019 |
Change in Accounting Principle, Accounting Standards Update, Transition Option Elected | us-gaap:AccountingStandardsUpdate201602CumulativeEffectPeriodOfAdoptionMember |
Accounting Standards Update 2019-12 | |
New Accounting Pronouncements | |
Change in Accounting Principle, Accounting Standards Update, Adopted | true |
Change in Accounting Principle, Accounting Standards Update, Adoption Date | Jan. 1, 2021 |
Change in Accounting Principle, Accounting Standards Update, Early Adoption | false |
Accounting Standards Update 2020-06 | |
New Accounting Pronouncements | |
Change in Accounting Principle, Accounting Standards Update, Adopted | false |
Accounting Standards Update 2021-04 | |
New Accounting Pronouncements | |
Change in Accounting Principle, Accounting Standards Update, Adopted | false |
Cyclerion Separation - Separati
Cyclerion Separation - Separation Agreement (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Apr. 01, 2019 |
Assets: | |||
Prepaid expenses and other current assets | $ 8,689 | $ 9,189 | |
Property and equipment, net | 7,575 | 8,929 | |
Other assets | 1,000 | 943 | |
Total assets | 1,126,927 | 559,238 | |
Liabilities: | |||
Accrued research and development costs | 15,896 | 1,898 | |
Accrued expenses and other current liabilities | $ 23,566 | $ 26,486 | |
Cyclerion Therapeutics, Inc. | |||
Assets: | |||
Prepaid expenses and other current assets | $ 1,169 | ||
Property and equipment, net | 10,241 | ||
Other assets | 21 | ||
Total assets | 11,431 | ||
Liabilities: | |||
Accrued research and development costs | 5,673 | ||
Accrued expenses and other current liabilities | 3,149 | ||
Total liabilities | 8,822 | ||
Net Assets Transferred to Cyclerion | $ 2,609 |
Cyclerion Separation - Related
Cyclerion Separation - Related Party Information (Details) - Affiliated Entity - Cyclerion Therapeutics, Inc. $ in Millions | 12 Months Ended | ||
Dec. 31, 2021agreement | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Cyclerion Separation | |||
Tenant improvement reimbursement provisions received | $ 1.3 | ||
Incremental stock-based compensation expense | 0 | ||
Transition services agreements | agreement | 2 | ||
Other income for services provided to related party | 0.3 | ||
Research and development | |||
Cyclerion Separation | |||
Expense for service provided by related party | $ 2.3 | $ 4.5 |
Cyclerion Separation - Summary
Cyclerion Separation - Summary of Expenses (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Net Loss from Discontinued Operations | |
Net loss from discontinued operations | $ 37,438 |
sGC Business | Discontinued Operations, Disposed of by Means Other than Sale, Spinoff | |
Net Loss from Discontinued Operations | |
Net loss from discontinued operations | 37,438 |
Research and development | sGC Business | Discontinued Operations, Disposed of by Means Other than Sale, Spinoff | |
Net Loss from Discontinued Operations | |
Net loss from discontinued operations | 21,792 |
Selling, general and administrative | sGC Business | Discontinued Operations, Disposed of by Means Other than Sale, Spinoff | |
Net Loss from Discontinued Operations | |
Net loss from discontinued operations | $ 15,646 |
Cyclerion Separation - Summar_2
Cyclerion Separation - Summary of Assets and Liabilities Held for Disposition (Details) - Discontinued Operations, Disposed of by Means Other than Sale, Spinoff - sGC Business - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Assets: | ||
Assets | $ 0 | $ 0 |
Liabilities: | ||
Liabilities | $ 0 | $ 0 |
Net Income Per Share - Computat
Net Income Per Share - Computation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Numerator: | |||||||||||
Net income | $ 41,374 | $ 55,845 | $ 391,303 | $ 39,926 | $ 43,204 | $ 34,423 | $ 25,204 | $ 3,345 | $ 528,448 | $ 106,176 | $ 21,505 |
Net income (loss) available to common stockholders, basic | 528,448 | 106,176 | 21,505 | ||||||||
Net income (loss) available to common stockholders, diluted | $ 528,448 | $ 106,176 | $ 21,505 | ||||||||
Denominator: | |||||||||||
Weighted average number of common shares outstanding used in computing net income per share - basic (in shares) | 162,245 | 159,427 | 156,023 | ||||||||
Effect of dilutive securities: | |||||||||||
Weighted average number of common shares outstanding used in computing net income per share - diluted (in shares) | 164,418 | 160,655 | 156,023 | ||||||||
Net income per share - basic (in dollars per share) | $ 0.25 | $ 0.34 | $ 2.42 | $ 0.25 | $ 0.27 | $ 0.22 | $ 0.16 | $ 0.02 | $ 3.26 | $ 0.67 | $ 0.14 |
Net income per share - diluted (in dollars per share) | $ 0.25 | $ 0.34 | $ 2.39 | $ 0.25 | $ 0.27 | $ 0.21 | $ 0.16 | $ 0.02 | $ 3.21 | $ 0.66 | $ 0.14 |
Employee stock options | |||||||||||
Effect of dilutive securities: | |||||||||||
Effect of dilutive securities | 488 | 367 | |||||||||
Time-based Restricted Stock Units | |||||||||||
Effect of dilutive securities: | |||||||||||
Effect of dilutive securities | 1,422 | 766 | |||||||||
Performance-based Restricted Stock Units | |||||||||||
Effect of dilutive securities: | |||||||||||
Effect of dilutive securities | 146 | 1 | |||||||||
Restricted Stock | |||||||||||
Effect of dilutive securities: | |||||||||||
Effect of dilutive securities | 117 | 94 |
Net Income Per Share - Potentia
Net Income Per Share - Potentially Dilutive Securities (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Potentially dilutive securities | |||
Total potentially dilutive securities excluded from the computation of diluted weighted average shares outstanding (in shares) | 54,428 | 58,554 | 67,087 |
Employee stock options | |||
Potentially dilutive securities | |||
Total potentially dilutive securities excluded from the computation of diluted weighted average shares outstanding (in shares) | 7,701 | 11,746 | 17,194 |
Restricted Stock | |||
Potentially dilutive securities | |||
Total potentially dilutive securities excluded from the computation of diluted weighted average shares outstanding (in shares) | 2 | 182 | |
Time-based Restricted Stock Units | |||
Potentially dilutive securities | |||
Total potentially dilutive securities excluded from the computation of diluted weighted average shares outstanding (in shares) | 102 | 209 | 3,207 |
Performance-based Restricted Stock Units | |||
Potentially dilutive securities | |||
Total potentially dilutive securities excluded from the computation of diluted weighted average shares outstanding (in shares) | 121 | 93 | |
Note Hedge Warrants | |||
Potentially dilutive securities | |||
Total potentially dilutive securities excluded from the computation of diluted weighted average shares outstanding (in shares) | 8,318 | 8,318 | 8,318 |
2.25% Convertible Senior Notes due 2022 | |||
Potentially dilutive securities | |||
Total potentially dilutive securities excluded from the computation of diluted weighted average shares outstanding (in shares) | 8,318 | 8,318 | 8,318 |
0.75% Convertible Senior Notes due 2024 | |||
Potentially dilutive securities | |||
Total potentially dilutive securities excluded from the computation of diluted weighted average shares outstanding (in shares) | 14,934 | 14,934 | 14,934 |
1.50% Convertible Senior Notes due 2026 | |||
Potentially dilutive securities | |||
Total potentially dilutive securities excluded from the computation of diluted weighted average shares outstanding (in shares) | 14,934 | 14,934 | 14,934 |
Collaboration, License, and O_3
Collaboration, License, and Other Agreements - Summary (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Revenues: | |||||||||||
Revenue | $ 117,130 | $ 103,747 | $ 104,031 | $ 88,845 | $ 116,680 | $ 103,468 | $ 89,432 | $ 79,943 | $ 413,753 | $ 389,523 | $ 428,413 |
Collaborative arrangements revenue | |||||||||||
Revenues: | |||||||||||
Revenue | 412,784 | 381,545 | 379,652 | ||||||||
Collaborative arrangement, other agreements | |||||||||||
Revenues: | |||||||||||
Revenue | 1,755 | 1,335 | 1,845 | ||||||||
Sale of active pharmaceutical ingredient | |||||||||||
Revenues: | |||||||||||
Revenue | 969 | 7,978 | 48,761 | ||||||||
AbbVie | Collaborative arrangement, co-promotion agreements | |||||||||||
Revenues: | |||||||||||
Revenue | 3,723 | ||||||||||
AbbVie | Sale of active pharmaceutical ingredient | |||||||||||
Revenues: | |||||||||||
Revenue | 223 | 421 | |||||||||
AbbVie | North America | Collaborative arrangements revenue | |||||||||||
Revenues: | |||||||||||
Revenue | 403,085 | 370,902 | 327,591 | ||||||||
AbbVie | North America | Collaborative arrangement, collaboration and license agreements | |||||||||||
Revenues: | |||||||||||
Revenue | 403,085 | 370,902 | 327,591 | ||||||||
AbbVie | Europe and Other | Collaborative arrangement, collaboration and license agreements | |||||||||||
Revenues: | |||||||||||
Revenue | 2,558 | 2,196 | 1,718 | ||||||||
AstraZeneca | Collaborative arrangement, collaboration and license agreements | |||||||||||
Revenues: | |||||||||||
Revenue | 743 | 682 | 32,628 | ||||||||
AstraZeneca | Sale of active pharmaceutical ingredient | |||||||||||
Revenues: | |||||||||||
Revenue | 597 | 5,540 | 2,973 | ||||||||
Astellas Pharma Inc. | Collaborative arrangement, collaboration and license agreements | |||||||||||
Revenues: | |||||||||||
Revenue | 2,232 | 2,128 | 10,147 | ||||||||
Astellas Pharma Inc. | Sale of active pharmaceutical ingredient | |||||||||||
Revenues: | |||||||||||
Revenue | 149 | 2,017 | 45,788 | ||||||||
Alnylam | Collaborative arrangement, co-promotion agreements | |||||||||||
Revenues: | |||||||||||
Revenue | $ 2,411 | $ 4,302 | $ 2,000 |
Collaboration, License, and O_4
Collaboration, License, and Other Agreements - Accounts Receivable (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Accounts receivable, net | ||
Accounts receivable, net | $ 138 | $ 145.8 |
Accounts receivable, net of accounts payable | 112.2 | 110.9 |
AbbVie | ||
Accounts receivable, net | ||
Accounts payable | $ 5 | $ 4.3 |
Collaboration, License, and O_5
Collaboration, License, and Other Agreements - North America - General Information (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021USD ($)itempayment | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Collaboration, License, Promotion and Other Commercial Agreements | |||
Sales-related milestone if certain conditions are met | $ 80,000 | ||
Research and development expense | 70,405 | $ 88,062 | $ 115,044 |
AbbVie | |||
Collaboration, License, Promotion and Other Commercial Agreements | |||
Cumulative license fees and development milestone payments received | $ 205,000 | ||
Number of milestone payments received | payment | 6 | ||
Equity investment in the entity's capital stock | $ 25,000 | ||
Remaining commercial-period performance obligations | item | 3 | ||
Cost sharing amount, reduction to research and development | $ 11,500 | 5,600 | 7,200 |
Collaborative arrangement, percentage of obligation of development costs incurred | 50.00% | ||
Percentage of net profit from commercialization (as a percent) | 50.00% | ||
Percentage of net loss from commercialization (as a percent) | 50.00% | ||
North America | |||
Collaboration, License, Promotion and Other Commercial Agreements | |||
Research and development expense | $ 8,200 | $ 20,100 | $ 37,600 |
Collaboration, License, and O_6
Collaboration, License, and Other Agreements - North America - Collaborative Arrangements Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Revenues: | |||||||||||
Revenue | $ 117,130 | $ 103,747 | $ 104,031 | $ 88,845 | $ 116,680 | $ 103,468 | $ 89,432 | $ 79,943 | $ 413,753 | $ 389,523 | $ 428,413 |
Collaborative arrangements revenue | |||||||||||
Revenues: | |||||||||||
Revenue | 412,784 | 381,545 | 379,652 | ||||||||
AbbVie | North America | Collaborative arrangements revenue | |||||||||||
Revenues: | |||||||||||
Revenue | 403,085 | 370,902 | 327,591 | ||||||||
AbbVie | North America | Collaborative arrangement, collaboration and license agreements | |||||||||||
Revenues: | |||||||||||
Revenue | 403,085 | 370,902 | 327,591 | ||||||||
AbbVie | North America | Collaborative arrangements, LINZESS | |||||||||||
Revenues: | |||||||||||
Revenue | 400,371 | 368,603 | 325,429 | ||||||||
AbbVie | North America | Royalty | |||||||||||
Revenues: | |||||||||||
Revenue | $ 2,714 | $ 2,299 | $ 2,162 |
Collaboration, License, and O_7
Collaboration, License, and Other Agreements - North America - Commercial Efforts (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Collaboration, License, Promotion and Other Commercial Agreements | |||||||||||
Revenue | $ 117,130 | $ 103,747 | $ 104,031 | $ 88,845 | $ 116,680 | $ 103,468 | $ 89,432 | $ 79,943 | $ 413,753 | $ 389,523 | $ 428,413 |
Selling, general and administrative | 111,133 | 140,003 | 172,450 | ||||||||
AbbVie | U.S. | |||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | |||||||||||
Patent prosecution and patent litigation costs | 300 | 600 | 2,400 | ||||||||
Collaborative arrangements revenue | |||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | |||||||||||
Revenue | 412,784 | 381,545 | 379,652 | ||||||||
Collaborative arrangements, LINZESS | AbbVie | U.S. | |||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | |||||||||||
Selling, general and administrative | $ 30,300 | $ 39,900 | $ 40,500 |
Collaboration, License, and O_8
Collaboration, License, and Other Agreements - North America - Royalty Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Revenues: | |||||||||||
Revenue | $ 117,130 | $ 103,747 | $ 104,031 | $ 88,845 | $ 116,680 | $ 103,468 | $ 89,432 | $ 79,943 | $ 413,753 | $ 389,523 | $ 428,413 |
Collaborative arrangements revenue | |||||||||||
Revenues: | |||||||||||
Revenue | 412,784 | 381,545 | 379,652 | ||||||||
Collaborative arrangements revenue | North America | AbbVie | |||||||||||
Revenues: | |||||||||||
Revenue | 403,085 | 370,902 | 327,591 | ||||||||
Collaborative arrangement, collaboration and license agreements | North America | AbbVie | |||||||||||
Revenues: | |||||||||||
Revenue | 403,085 | 370,902 | 327,591 | ||||||||
Royalty | North America | AbbVie | |||||||||||
Revenues: | |||||||||||
Revenue | 2,714 | 2,299 | 2,162 | ||||||||
Royalty | Canada and Mexico | AbbVie | |||||||||||
Revenues: | |||||||||||
Revenue | $ 2,700 | $ 2,300 | $ 2,200 |
Collaboration, License, and O_9
Collaboration, License, and Other Agreements - European and Other Territories (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Oct. 31, 2015 | Sep. 30, 2012 | |
Collaboration, License, Promotion and Other Commercial Agreements | |||||||||||||
Revenue | $ 117,130 | $ 103,747 | $ 104,031 | $ 88,845 | $ 116,680 | $ 103,468 | $ 89,432 | $ 79,943 | $ 413,753 | $ 389,523 | $ 428,413 | ||
Collaborative arrangements revenue | |||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | |||||||||||||
Revenue | 412,784 | 381,545 | 379,652 | ||||||||||
Collaborative arrangement, collaboration and license agreements | AbbVie | Europe and Other | |||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | |||||||||||||
Revenue | $ 2,558 | 2,196 | 1,718 | ||||||||||
License | AbbVie | |||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | |||||||||||||
Remaining milestone payment due upon the amendment to the license agreement | $ 42,500 | ||||||||||||
Royalty percentage, five years following the first commercial sale | upper-single digits | ||||||||||||
Annual royalty | 5 years | ||||||||||||
Royalty percentage, thereafter | low-double digits | ||||||||||||
Royalty percentage, expanded territory | lower-single digits | ||||||||||||
Revenue remaining performance obligation | $ 0 | ||||||||||||
Royalty | AbbVie | Europe and Other | |||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | |||||||||||||
Revenue | $ 2,600 | $ 2,200 | $ 1,700 |
Collaboration, License, and _10
Collaboration, License, and Other Agreements - Japan (Details) $ in Thousands | Aug. 01, 2019USD ($) | Nov. 30, 2009USD ($)payment | Dec. 31, 2021USD ($) | Sep. 30, 2021USD ($) | Jun. 30, 2021USD ($) | Mar. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Sep. 30, 2020USD ($) | Jun. 30, 2020USD ($) | Mar. 31, 2020USD ($) | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2017USD ($) |
Collaboration, License, Promotion and Other Commercial Agreements | ||||||||||||||
Revenue | $ 117,130 | $ 103,747 | $ 104,031 | $ 88,845 | $ 116,680 | $ 103,468 | $ 89,432 | $ 79,943 | $ 413,753 | $ 389,523 | $ 428,413 | |||
Astellas Pharma Inc., 2009 License Agreement | ||||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | ||||||||||||||
Up-front fee received | $ 30,000 | |||||||||||||
Number of milestone payments | payment | 3 | |||||||||||||
Milestone payments received | $ 45,000 | |||||||||||||
Collaborative arrangements revenue | ||||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | ||||||||||||||
Revenue | 412,784 | 381,545 | 379,652 | |||||||||||
Collaborative arrangement, collaboration and license agreements | Astellas Pharma Inc. | ||||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | ||||||||||||||
Revenue | 2,232 | 2,128 | 10,147 | |||||||||||
Collaborative arrangement, collaboration and license agreements | Astellas Pharma Inc., 2009 License Agreement, Amended 2019 | ||||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | ||||||||||||||
Revenue | $ 20,400 | |||||||||||||
Non-refundable upfront payment | $ 10,000 | |||||||||||||
Collaborative arrangement, collaboration and license agreements, upfront fee | Astellas Pharma Inc., 2009 License Agreement, Amended 2019 | ||||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | ||||||||||||||
Revenue | 10,000 | |||||||||||||
Royalty | Astellas Pharma Inc., 2009 License Agreement, Amended 2019 | ||||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | ||||||||||||||
Revenue | 2,200 | 2,100 | ||||||||||||
Sale of active pharmaceutical ingredient | ||||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | ||||||||||||||
Revenue | 969 | 7,978 | 48,761 | |||||||||||
Sale of active pharmaceutical ingredient | Astellas Pharma Inc. | ||||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | ||||||||||||||
Revenue | 149 | 2,017 | 45,788 | |||||||||||
Sale of active pharmaceutical ingredient | Astellas Pharma Inc., 2009 License Agreement | ||||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | ||||||||||||||
Revenue | 27,500 | |||||||||||||
Revenue remaining performance obligation | $ 0 | |||||||||||||
Sale of active pharmaceutical ingredient | Astellas Pharma Inc., 2009 License Agreement, Amended 2019 | ||||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | ||||||||||||||
Revenue | $ 200 | $ 2,000 | $ 18,300 |
Collaboration, License, and _11
Collaboration, License, and Other Agreements - China, Hong Kong and Macau (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 31, 2021USD ($) | Dec. 31, 2021USD ($) | Sep. 30, 2021USD ($) | Jun. 30, 2021USD ($) | Mar. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Sep. 30, 2020USD ($) | Jun. 30, 2020USD ($) | Mar. 31, 2020USD ($) | Dec. 31, 2021USD ($)installment | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Collaboration, License, Promotion and Other Commercial Agreements | ||||||||||||
Revenue | $ 117,130 | $ 103,747 | $ 104,031 | $ 88,845 | $ 116,680 | $ 103,468 | $ 89,432 | $ 79,943 | $ 413,753 | $ 389,523 | $ 428,413 | |
Collaborative arrangements revenue | ||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | ||||||||||||
Revenue | 412,784 | 381,545 | 379,652 | |||||||||
Sale of active pharmaceutical ingredient | ||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | ||||||||||||
Revenue | 969 | 7,978 | 48,761 | |||||||||
AstraZeneca | ||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | ||||||||||||
Milestone payment to be received by company upon milestone achievement | $ 90,000 | |||||||||||
Percentage of net loss from commercialization (as a percent) | 55.00% | |||||||||||
Pre-launch commercial services and supply chain services | 1,200 | |||||||||||
Amount of non-contingent arrangement consideration | $ 35,000 | |||||||||||
Non-contingent consideration installments | installment | 3 | |||||||||||
Non-contingent arrangement consideration installment received | $ 10,000 | |||||||||||
Percentage of tiered royalties | 20.00% | |||||||||||
Interest income | $ 600 | 800 | 200 | |||||||||
AstraZeneca | Collaborative arrangements revenue | ||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | ||||||||||||
Collaborative arrangement, significant financing component, transaction price | 2,600 | 2,600 | ||||||||||
Collaborative arrangement, expected interest income | $ 2,600 | 2,600 | ||||||||||
AstraZeneca | Collaborative arrangement, collaboration and license agreements | ||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | ||||||||||||
Revenue | 743 | 682 | 32,628 | |||||||||
AstraZeneca | License | ||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | ||||||||||||
Revenue | 32,400 | 32,400 | ||||||||||
AstraZeneca | Collaborative arrangement, transition services agreement | ||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | ||||||||||||
Revenue | 200 | 600 | 200 | |||||||||
AstraZeneca | Royalty | ||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | ||||||||||||
Revenue | 500 | 100 | ||||||||||
AstraZeneca | Sale of active pharmaceutical ingredient | ||||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | ||||||||||||
Revenue | $ 597 | $ 5,540 | $ 2,973 |
Collaboration, License, and _12
Collaboration, License, and Other Agreements - Other Collaboration and License Agreements (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Collaboration, License, Promotion and Other Commercial Agreements | |||||||||||
Revenue | $ 117,130 | $ 103,747 | $ 104,031 | $ 88,845 | $ 116,680 | $ 103,468 | $ 89,432 | $ 79,943 | $ 413,753 | $ 389,523 | $ 428,413 |
Research and development expense | 70,405 | 88,062 | 115,044 | ||||||||
Accrued research and development costs | 15,896 | 1,898 | 15,896 | 1,898 | |||||||
Collaborative arrangements revenue | |||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | |||||||||||
Revenue | 412,784 | 381,545 | 379,652 | ||||||||
Alnylam | Collaborative arrangement, co-promotion agreements | |||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | |||||||||||
Total annual service fees due | $ 5,500 | 5,500 | |||||||||
Revenue | 2,411 | 4,302 | 2,000 | ||||||||
Alnylam | Service fees | |||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | |||||||||||
Revenue | 3,500 | $ 2,000 | |||||||||
Alnylam | Royalty | |||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | |||||||||||
Revenue | 2,400 | $ 800 | |||||||||
COUR Pharmaceuticals Development Company, Inc. | |||||||||||
Collaboration, License, Promotion and Other Commercial Agreements | |||||||||||
Collaborative arrangement, upfront payment | 6,000 | ||||||||||
Collaborative arrangement, contingent payment, payable | 13,500 | 13,500 | |||||||||
Collaborative arrangement, option to acquire license, exercise price, payable | 35,000 | 35,000 | |||||||||
Collaborative arrangement, milestones. potential commercial milestone payments, term of agreement, payable | 440,000 | 440,000 | |||||||||
Research and development expense | 19,500 | ||||||||||
Accrued research and development costs | $ 13,500 | $ 13,500 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - General Information (Details) | Dec. 31, 2021 |
Fair Value of Financial Instruments | |
Threshold percentage of collateralized value (as a percent) | 102.00% |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Measured on Recurring Basis (Details) - Recurring basis - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Assets: | ||
Convertible note hedges | $ 1,115 | $ 13,065 |
Total assets measured at fair value | 598,083 | 364,300 |
Liabilities: | ||
Note hedge warrants | 1,316 | 12,088 |
Total liabilities measured at fair value | 1,316 | 12,088 |
Money market funds | ||
Assets: | ||
Cash and cash equivalents | 595,233 | 349,014 |
Restricted cash | 1,735 | 2,221 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Total assets measured at fair value | 596,968 | 351,235 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Money market funds | ||
Assets: | ||
Cash and cash equivalents | 595,233 | 349,014 |
Restricted cash | 1,735 | 2,221 |
Significant Unobservable Inputs (Level 3) | ||
Assets: | ||
Convertible note hedges | 1,115 | 13,065 |
Total assets measured at fair value | 1,115 | 13,065 |
Liabilities: | ||
Note hedge warrants | 1,316 | 12,088 |
Total liabilities measured at fair value | $ 1,316 | $ 12,088 |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments - Transfers Between Fair Value Measurement Levels (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Fair value transfers | |||
Fair value transfer between measurement levels | $ 0 | $ 0 | $ 0 |
Fair Value of Financial Instr_6
Fair Value of Financial Instruments - Assumptions - Convertible Note Hedges (Details) | Dec. 31, 2021$ / sharesY | Dec. 31, 2020$ / sharesY |
Fair Value of Financial Instruments | ||
Derivative asset, valuation technique | us-gaap:ValuationTechniqueOptionPricingModelMember | us-gaap:ValuationTechniqueOptionPricingModelMember |
Measurement Input, Risk Free Interest Rate | ||
Fair Value of Financial Instruments | ||
Derivative asset, measurement input | 0.002 | 0.001 |
Measurement Input, Expected Term | ||
Fair Value of Financial Instruments | ||
Derivative asset, measurement input | Y | 0.5 | 1.5 |
Measurement Input, Share Price | ||
Fair Value of Financial Instruments | ||
Derivative asset, measurement input | 11.66 | 11.39 |
Measurement Input, Exercise Price | ||
Fair Value of Financial Instruments | ||
Derivative asset, measurement input | 14.51 | 14.51 |
Measurement Input, Price Volatility | ||
Fair Value of Financial Instruments | ||
Derivative asset, measurement input | 0.270 | 0.467 |
Measurement Input, Expected Dividend Rate | ||
Fair Value of Financial Instruments | ||
Derivative asset, measurement input | 0 | 0 |
Fair Value of Financial Instr_7
Fair Value of Financial Instruments - Assumptions - Note Hedge Warrants (Details) | Dec. 31, 2021$ / sharesY | Dec. 31, 2020$ / sharesY |
Fair Value of Financial Instruments | ||
Derivative liability, valuation technique | us-gaap:ValuationTechniqueOptionPricingModelMember | us-gaap:ValuationTechniqueOptionPricingModelMember |
Measurement Input, Risk Free Interest Rate | ||
Fair Value of Financial Instruments | ||
Derivative liability, measurement input | 0.004 | 0.001 |
Measurement Input, Expected Term | ||
Fair Value of Financial Instruments | ||
Derivative liability, measurement input | Y | 1 | 2 |
Measurement Input, Share Price | ||
Fair Value of Financial Instruments | ||
Derivative liability, measurement input | 11.66 | 11.39 |
Measurement Input, Exercise Price | ||
Fair Value of Financial Instruments | ||
Derivative liability, measurement input | 18.82 | 18.82 |
Measurement Input, Price Volatility | ||
Fair Value of Financial Instruments | ||
Derivative liability, measurement input | 0.322 | 0.503 |
Measurement Input, Expected Dividend Rate | ||
Fair Value of Financial Instruments | ||
Derivative liability, measurement input | 0 | 0 |
Fair Value of Financial Instr_8
Fair Value of Financial Instruments - Change in Level 3 - Convertible Note Hedges (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Change in Level 3 Assets | ||
Balance at beginning of period | $ 13,065 | $ 31,366 |
Change in fair value, recorded as a component of (loss) gain on derivatives | (11,950) | (18,301) |
Balance at end of period | $ 1,115 | $ 13,065 |
Fair Value of Financial Instr_9
Fair Value of Financial Instruments - Change in Level 3 - Note Hedge Warrants (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Change in Level 3 Liabilities | ||
Balance at beginning of period | $ (12,088) | $ (24,260) |
Change in fair value, recorded as a component of gain (loss) on derivatives | 10,772 | 12,172 |
Balance at end of period | $ (1,316) | $ (12,088) |
Fair Value of Financial Inst_10
Fair Value of Financial Instruments - Notes Payable (Details) - Convertible Senior Notes - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Aug. 31, 2019 | Jun. 30, 2015 |
2.25% Convertible Senior Notes due 2022 | ||||
Fair value disclosures | ||||
Aggregate principal amount of notes issued | $ 120,699 | $ 120,699 | $ 335,700 | |
Debt redeemed/repurchased | $ 215,000 | |||
2.25% Convertible Senior Notes due 2022 | Significant Other Observable Inputs (Level 2) | ||||
Fair value disclosures | ||||
Estimated fair value | 125,200 | 130,200 | ||
0.75% Convertible Senior Notes due 2024 | ||||
Fair value disclosures | ||||
Aggregate principal amount of notes issued | 200,000 | 200,000 | 200,000 | |
0.75% Convertible Senior Notes due 2024 | Significant Other Observable Inputs (Level 2) | ||||
Fair value disclosures | ||||
Estimated fair value | 221,900 | 222,300 | ||
1.50% Convertible Senior Notes due 2026 | ||||
Fair value disclosures | ||||
Aggregate principal amount of notes issued | 200,000 | 200,000 | $ 200,000 | |
1.50% Convertible Senior Notes due 2026 | Significant Other Observable Inputs (Level 2) | ||||
Fair value disclosures | ||||
Estimated fair value | $ 227,200 | $ 224,100 |
Fair Value of Financial Inst_11
Fair Value of Financial Instruments - Capped Calls with Respect to 2024 Convertible Notes and 2026 Convertible Notes (Details) - Capped Calls with Respect to 2024 Convertible Notes and 2026 Convertible Notes | 1 Months Ended |
Aug. 31, 2019$ / shares$ / itemshares | |
Capped Calls | |
Number of shares covered by capped calls (in shares) | shares | 29,867,480 |
Strike price (in dollars per share) | $ / shares | $ 13.39 |
Cap price | $ / item | 17.05 |
Leases - General Information (D
Leases - General Information (Details) - Accounting Standards Update 2016-02 | 12 Months Ended |
Dec. 31, 2021 | |
New Accounting Pronouncements | |
Change in Accounting Principle, Accounting Standards Update, Adopted | true |
Change in Accounting Principle, Accounting Standards Update, Adoption Date | Jan. 1, 2019 |
Change in Accounting Principle, Accounting Standards Update, Transition Option Elected | us-gaap:AccountingStandardsUpdate201602CumulativeEffectPeriodOfAdoptionMember |
Leases - Vehicle Fleet Leases (
Leases - Vehicle Fleet Leases (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Operating leases | |||
Restricted cash | $ 1,735 | $ 2,220 | $ 2,221 |
Vehicles, 2018 Vehicle Leases | |||
Operating leases | |||
Restricted cash | $ 1,700 | $ 2,200 |
Leases - Lease Cost - Tabular D
Leases - Lease Cost - Tabular Disclosure (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Lease cost | |||
Operating lease cost | $ 2,520 | $ 2,530 | $ 16,452 |
Variable lease payments | 1,526 | ||
Short-term lease cost | 960 | 1,420 | 1,512 |
Total lease cost | $ 3,480 | $ 3,950 | $ 19,490 |
Leases - Lease Cost - Sublease
Leases - Lease Cost - Sublease Income (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Lease cost | |
Sublease income | $ 0.3 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Operating leases | |||
Right-of-use assets obtained in exchange for new operating lease upon adoption of ASC 842 | $ 88,299 | ||
Adjustment to right-of-use assets as a result of the lease modification upon Separation | (40,427) | ||
Adjustment to right-of-use assets as a result of the termination of the Binney Street Lease | (34,440) | ||
Right-of-use assets obtained in exchange for new operating lease liabilities upon execution of Summer Street Lease | 18,452 | ||
Cash paid for amounts included in the measurement of lease liabilities | $ 3,128 | $ 1,146 | $ 18,598 |
Weighted-average remaining lease term of operating leases (in years) | 8 years 3 months 18 days | 9 years 3 months 18 days | 10 years 2 months 12 days |
Weighted-average discount rate of operating leases (as a percent) | 5.80% | 5.80% | 5.80% |
Leases - Future Minimum Lease P
Leases - Future Minimum Lease Payments (Details) $ in Thousands | Dec. 31, 2021USD ($) |
Future minimum lease payments | |
2022 | $ 3,129 |
2023 | 3,065 |
2024 | 3,126 |
2025 | 3,189 |
2026 | 3,252 |
2027 and thereafter | 11,603 |
Total future minimum lease payments | $ 27,364 |
Leases - Operating Lease Obliga
Leases - Operating Lease Obligations (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Operating lease obligations | ||
Total future minimum lease payments | $ 27,364 | |
Less: present value adjustment | (5,753) | |
Operating lease liabilities | 21,611 | |
Less: current portion of operating lease liabilities | (3,127) | $ (3,128) |
Operating lease liabilities, net of current portion | $ 18,484 | $ 20,318 |
Leases - Summer Street Lease (D
Leases - Summer Street Lease (Details) ft² in Thousands, $ in Thousands | Jun. 11, 2019ft² | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) |
Operating leases | ||||
Weighted-average discount rate of operating leases (as a percent) | 5.80% | 5.80% | 5.80% | |
Operating lease right-of-use assets | $ 15,350 | $ 16,576 | ||
Operating lease liability | 21,611 | |||
Operating lease cost | $ 2,520 | 2,530 | $ 16,452 | |
Summer Street Lease | ||||
Operating leases | ||||
Rentable area leased (in square feet) | ft² | 39 | |||
Annual rent escalation (as a percent) | 2.00% | |||
Option to extend the term of the lease | true | |||
Operating lease, renewal term | 5 years | |||
Weighted-average discount rate of operating leases (as a percent) | 5.80% | |||
Operating lease right-of-use assets | $ 15,300 | 16,600 | ||
Operating lease cost | 2,500 | 2,500 | $ 1,500 | |
Lease liability, net of tenant improvement allowance reimbursement | $ 21,500 | $ 23,200 |
Leases - Binney Street Lease (D
Leases - Binney Street Lease (Details) $ in Thousands | Jun. 11, 2019USD ($)ft² | Apr. 01, 2019ft² | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Jan. 01, 2019USD ($) |
Operating leases | ||||||
Weighted-average discount rate of operating leases (as a percent) | 5.80% | 5.80% | 5.80% | |||
Operating lease cost | $ 2,520 | $ 2,530 | $ 16,452 | |||
Sublease income | 300 | |||||
Restricted cash, noncurrent | 485 | 485 | ||||
Operating lease right-of-use assets | 15,350 | $ 16,576 | ||||
Operating lease liability | $ 21,611 | |||||
Binney Street Lease | ||||||
Operating leases | ||||||
Rentable area leased (in square feet) | ft² | 108,000 | 108,000 | ||||
Surrendered space (in square feet) | ft² | 114,000 | |||||
Weighted-average discount rate of operating leases (as a percent) | 4.00% | 5.10% | ||||
Gain on modification of lease | 3,200 | |||||
Lease termination cost | $ 9,000 | |||||
Operating lease cost | 16,300 | |||||
Sublease income | $ 300 | |||||
Operating lease right-of-use assets | $ 87,700 | |||||
Operating lease liability | $ 94,300 |
Property and Equipment - Tabula
Property and Equipment - Tabular Disclosure (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Property and Equipment | ||
Property and equipment, gross | $ 17,203 | $ 20,734 |
Less accumulated depreciation and amortization | (9,628) | (11,805) |
Property and equipment, net | 7,575 | 8,929 |
Software | ||
Property and Equipment | ||
Property and equipment, gross | 5,667 | 8,615 |
Leasehold improvements | ||
Property and Equipment | ||
Property and equipment, gross | 7,407 | 7,407 |
Laboratory equipment | ||
Property and Equipment | ||
Property and equipment, gross | 1,327 | 1,898 |
Furniture and fixtures | ||
Property and Equipment | ||
Property and equipment, gross | 1,517 | 1,517 |
Computer and office equipment | ||
Property and Equipment | ||
Property and equipment, gross | $ 1,285 | $ 1,297 |
Property and Equipment - Deprec
Property and Equipment - Depreciation Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Property and Equipment | |||
Depreciation and amortization | $ 1.5 | $ 2.3 | $ 5.6 |
Property and Equipment - Restru
Property and Equipment - Restructuring (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Reduction in Workforce, Discontinued Development of IW-3718, September 29, 2020 | |
Impairment of Long-Lived Assets | |
Impairment of long-lived assets | $ 1.2 |
Accrued Expenses and Other Cu_3
Accrued Expenses and Other Current Liabilities - Tabular Disclosure (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Accrued Expenses | ||
Accrued compensation and benefits | $ 16,653 | $ 13,413 |
Restructuring liabilities | 462 | 10,510 |
Stock repurchase | 3,009 | |
Other | 3,442 | 2,563 |
Total accrued expenses and other current liabilities | $ 23,566 | $ 26,486 |
Accrued Expenses and Other Cu_4
Accrued Expenses and Other Current Liabilities - Additional Information (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Accrued Expenses | ||
Other accrued expenses | $ 3,442 | $ 2,563 |
Other accrued liabilities, uninvoiced vendor liabilities | 2,700 | 2,100 |
Accrued interest | 300 | $ 300 |
Income taxes payable | $ 200 |
Notes Payable - General Informa
Notes Payable - General Information (Details) | Aug. 31, 2019USD ($) | Apr. 15, 2019USD ($)$ / sharesshares | Aug. 31, 2019USD ($) | Jun. 30, 2015USD ($)$ / sharesshares | Dec. 31, 2021USD ($)$ / sharesshares | Dec. 31, 2019USD ($) | Dec. 31, 2020USD ($) | Sep. 16, 2019 |
Notes Payable | ||||||||
Payments for convertible note hedges | $ 25,200,000 | $ 21,100,000 | ||||||
Net proceeds received | $ 400,000,000 | |||||||
Proceeds from partial termination of convertible note hedges and note hedge warrants | 3,200,000 | |||||||
Loss on extinguishment of debt | 30,977,000 | |||||||
Equity component of convertible senior notes | $ 92,502,000 | |||||||
Convertible Note Hedge | ||||||||
Notes Payable | ||||||||
Conversion price (in dollars per share) | $ / shares | $ 14.51 | $ 16.58 | ||||||
Shares issuable upon conversion of debt (in shares) | shares | 20,249,665 | |||||||
2.25% Convertible Senior Notes due 2022 | Note Hedge Warrants | ||||||||
Notes Payable | ||||||||
Shares issuable upon conversion of debt (in shares) | shares | 23,135,435 | |||||||
2.25% Convertible Senior Notes due 2022 | Convertible Senior Notes | ||||||||
Notes Payable | ||||||||
Aggregate principal amount of notes issued | 335,700,000 | $ 120,699,000 | $ 120,699,000 | |||||
Net proceed received | 324,000,000 | |||||||
Fees and expenses | $ 11,700,000 | |||||||
Stated interest rate (as a percent) | 2.25% | 2.25% | ||||||
Conversion rate, number of shares to be issued per | 68.9172 | 60.3209 | ||||||
Principal amount used for debt instrument conversion ratio | $ 1,000 | $ 1,000 | ||||||
Conversion price (in dollars per share) | $ / shares | $ 14.51 | $ 16.58 | ||||||
Shares issuable upon conversion of debt (in shares) | shares | 23,135,435 | 20,249,665 | ||||||
Repurchase price, as percentage of principal amount, if company undergoes change of control | 100.00% | |||||||
Maximum period of the sole remedy for event failures in the Indenture | 180 days | |||||||
Amortization period | 7 years | |||||||
Debt redeemed/repurchased | $ 215,000,000 | 215,000,000 | ||||||
Debt redemption/repurchase price | 227,300,000 | 227,300,000 | ||||||
Loss on extinguishment of debt | $ 23,400,000 | 23,400,000 | ||||||
Equity component of convertible senior notes | 27,000,000 | |||||||
Initial debt issuance costs | $ 2,800,000 | |||||||
2.25% Convertible Senior Notes due 2022 | Convertible Senior Notes | Minimum | ||||||||
Notes Payable | ||||||||
Percentage of aggregate principal amount payable, in case of event of default | 25.00% |
Notes Payable - Convertible Sen
Notes Payable - Convertible Senior Notes - Balances (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Aug. 31, 2019 | Jun. 30, 2015 |
Liability component: | ||||
Less: unamortized debt discount | $ (61,641) | |||
Less: unamortized debt issuance costs | (4,867) | |||
Net carrying amount | 454,191 | |||
Convertible Senior Notes | ||||
Liability component: | ||||
Less: unamortized debt discount | (61,641) | $ (83,900) | ||
Less: unamortized debt issuance costs | (4,867) | (6,543) | ||
Net carrying amount | 454,191 | 430,256 | ||
Total equity component | 112,309 | 112,309 | ||
2.25% Convertible Senior Notes due 2022 | Convertible Senior Notes | ||||
Liability component: | ||||
Aggregate principal amount of notes issued | 120,699 | 120,699 | $ 335,700 | |
Total equity component | 19,807 | 19,807 | ||
0.75% Convertible Senior Notes due 2024 | Convertible Senior Notes | ||||
Liability component: | ||||
Aggregate principal amount of notes issued | 200,000 | 200,000 | $ 200,000 | |
Total equity component | 41,152 | 41,152 | ||
1.50% Convertible Senior Notes due 2026 | Convertible Senior Notes | ||||
Liability component: | ||||
Aggregate principal amount of notes issued | 200,000 | 200,000 | $ 200,000 | |
Total equity component | $ 51,350 | $ 51,350 |
Notes Payable - Convertible S_2
Notes Payable - Convertible Senior Notes - Additional Information (Details) - 2.25% Convertible Senior Notes due 2022 - Convertible Senior Notes - USD ($) $ in Millions | 1 Months Ended | ||
Jun. 30, 2015 | Dec. 31, 2021 | Jun. 30, 2019 | |
Notes Payable | |||
Debt issuance costs incurred | $ 11.7 | ||
Debt issuance costs allocated to equity components | 4 | ||
Debt issuance costs allocated to liability components | $ 7.7 | ||
Debt instrument term | 7 years | ||
Effective interest rate on liability components | 10.10% | 9.34% |
Notes Payable - Convertible S_3
Notes Payable - Convertible Senior Notes - Interest Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Interest Expense | |||
Contractual interest expense | $ 7,216 | $ 7,216 | $ 7,361 |
Amortization of debt issuance costs | 1,678 | 1,462 | 1,190 |
Amortization of debt discount | 22,256 | 20,800 | 17,683 |
Total interest expense | $ 31,150 | $ 29,478 | $ 26,234 |
Notes Payable - Convertible S_4
Notes Payable - Convertible Senior Notes - Future Minimum Payments - Tabular Disclosure (Details) $ in Thousands | Dec. 31, 2021USD ($) |
Future minimum payments of Convertible senior notes | |
2022 | $ 126,557 |
2023 | 4,500 |
2024 | 203,750 |
2025 | 3,000 |
2026 | 201,500 |
Total future minimum payments under the convertible senior notes | 539,307 |
Less: amounts representing interest | (18,608) |
Less: unamortized debt discount | (61,641) |
Less: unamortized debt issuance costs | (4,867) |
Net carrying amount | $ 454,191 |
Notes Payable - Convertible S_5
Notes Payable - Convertible Senior Notes - Future Minimum Payments - Additional Information (Details) $ in Millions | Dec. 31, 2021USD ($) |
2.25% Convertible Senior Notes due 2022 | Convertible Senior Notes | |
Notes Payable | |
Long-term debt, current maturities | $ 120.7 |
Notes Payable - Convertible S_6
Notes Payable - Convertible Senior Notes Due 2024 and Convertible Senior Notes Due 2026 (Details) | Aug. 12, 2019 | Aug. 07, 2019USD ($)$ / shares | Apr. 15, 2019USD ($)$ / sharesshares | Aug. 31, 2019USD ($)D | Jun. 30, 2015USD ($)$ / sharesshares | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Sep. 16, 2019 |
Notes Payable | ||||||||
Payments for convertible note hedges | $ 25,200,000 | $ 21,100,000 | ||||||
Repurchase price | 100.00% | |||||||
Percentage of aggregate principal amount of notes outstanding and payable in case of event of default under the agreement | 25.00% | |||||||
2.25% Convertible Senior Notes due 2022 | Convertible Senior Notes | ||||||||
Notes Payable | ||||||||
Aggregate principal amount of notes issued | 335,700,000 | $ 120,699,000 | $ 120,699,000 | |||||
Net proceed received | 324,000,000 | |||||||
Fees and expenses | $ 11,700,000 | |||||||
Stated interest rate (as a percent) | 2.25% | 2.25% | ||||||
Conversion rate, number of shares to be issued per | 68.9172 | 60.3209 | ||||||
Principal amount used for debt instrument conversion ratio | $ 1,000 | $ 1,000 | ||||||
Initial conversion price (in dollars per share) | $ / shares | $ 14.51 | $ 16.58 | ||||||
Shares issuable upon conversion of debt (in shares) | shares | 23,135,435 | 20,249,665 | ||||||
Repurchase price, as percentage of principal amount, if company undergoes change of control | 100.00% | |||||||
Amortization period | 7 years | |||||||
Debt instrument term | 7 years | |||||||
2.25% Convertible Senior Notes due 2022 | Convertible Senior Notes | Minimum | ||||||||
Notes Payable | ||||||||
Percentage of aggregate principal amount payable, in case of event of default | 25.00% | |||||||
0.75% Convertible Senior Notes due 2024 and 1.50% Convertible Senior Notes due 2026 | Convertible Senior Notes | ||||||||
Notes Payable | ||||||||
Net proceed received | $ 391,000,000 | |||||||
Fees and expenses | 9,000,000 | |||||||
Conversion rate, number of shares to be issued per | 74.6687 | |||||||
Principal amount used for debt instrument conversion ratio | $ 1,000 | $ 1,000 | ||||||
Initial conversion price (in dollars per share) | $ / shares | $ 13.39 | |||||||
Number of consecutive trading days before five business days during the measurement period | D | 5 | |||||||
0.75% Convertible Senior Notes due 2024 and 1.50% Convertible Senior Notes due 2026 | Convertible Senior Notes | Calendar quarter commencing after December 31, 2019 | ||||||||
Notes Payable | ||||||||
Number of trading days | D | 20 | |||||||
Consecutive trading days | D | 30 | |||||||
0.75% Convertible Senior Notes due 2024 and 1.50% Convertible Senior Notes due 2026 | Convertible Senior Notes | Measurement period | ||||||||
Notes Payable | ||||||||
Number of business days immediately after any five consecutive trading day period during the measurement period | D | 5 | |||||||
0.75% Convertible Senior Notes due 2024 and 1.50% Convertible Senior Notes due 2026 | Convertible Senior Notes | Minimum | Calendar quarter commencing after December 31, 2019 | ||||||||
Notes Payable | ||||||||
Minimum percentage of stock price | 130.00% | |||||||
0.75% Convertible Senior Notes due 2024 and 1.50% Convertible Senior Notes due 2026 | Convertible Senior Notes | Maximum | Measurement period | ||||||||
Notes Payable | ||||||||
Conversion premium percentage on sale price of common stock | 98.00% | |||||||
0.75% Convertible Senior Notes due 2024 | Convertible Senior Notes | ||||||||
Notes Payable | ||||||||
Aggregate principal amount of notes issued | $ 200,000,000 | 200,000,000 | 200,000,000 | |||||
Stated interest rate (as a percent) | 0.75% | |||||||
Amortization period | 5 years | |||||||
Debt instrument term | 5 years | |||||||
1.50% Convertible Senior Notes due 2026 | Convertible Senior Notes | ||||||||
Notes Payable | ||||||||
Aggregate principal amount of notes issued | $ 200,000,000 | $ 200,000,000 | $ 200,000,000 | |||||
Stated interest rate (as a percent) | 1.50% | |||||||
Amortization period | 7 years | |||||||
Debt instrument term | 7 years |
Notes Payable - Convertible S_7
Notes Payable - Convertible Senior Notes Due 2022, Convertible Senior Notes Due 2024 and Convertible Senior Notes Due 2026 (Details) - Convertible Senior Notes - USD ($) $ in Millions | 1 Months Ended | |||
Aug. 31, 2019 | Jun. 30, 2015 | Dec. 31, 2021 | Jun. 30, 2019 | |
2.25% Convertible Senior Notes due 2022 | ||||
Notes Payable | ||||
Debt issuance costs incurred | $ 11.7 | |||
Debt issuance costs allocated to equity components | 4 | |||
Debt issuance costs allocated to liability components | $ 7.7 | |||
Debt instrument term | 7 years | |||
Effective interest rate on liability components | 10.10% | 9.34% | ||
0.75% Convertible Senior Notes due 2024 and 1.50% Convertible Senior Notes due 2026 | ||||
Notes Payable | ||||
Debt issuance costs incurred | $ 9 | |||
Debt issuance costs allocated to equity components | 2.1 | |||
Debt issuance costs allocated to liability components | $ 6.9 | |||
0.75% Convertible Senior Notes due 2024 | ||||
Notes Payable | ||||
Debt instrument term | 5 years | |||
Effective interest rate on liability components | 6.50% | |||
1.50% Convertible Senior Notes due 2026 | ||||
Notes Payable | ||||
Debt instrument term | 7 years | |||
Effective interest rate on liability components | 6.80% |
Notes Payable - Convertible Not
Notes Payable - Convertible Note Hedge and Warrant Transactions (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Jun. 30, 2015 | Dec. 31, 2021 | Dec. 31, 2020 | Apr. 15, 2019 | |
Notes Payable | ||||
Long-term asset | $ 13,065 | |||
Long-term liability | $ 12,088 | |||
Net derivative issuance cost | $ 21,100 | |||
Convertible Note Hedge | ||||
Notes Payable | ||||
Shares issuable upon conversion of debt (in shares) | 20,249,665 | |||
Conversion price (in dollars per share) | $ 16.58 | $ 14.51 | ||
Long-term asset | 91,900 | |||
Note Hedge Warrant Derivatives | ||||
Notes Payable | ||||
Shares into which warrants may be converted (in shares) | 20,249,665 | |||
Trading day period | 150 days | |||
Long-term liability | $ 70,800 | |||
Note Hedge Warrants | ||||
Notes Payable | ||||
Warrants strike price (in dollars per share) | $ 21.50 | $ 18.82 |
Notes Payable - Capped Calls wi
Notes Payable - Capped Calls with Respect to 2024 Convertible Notes and 2026 Convertible Notes (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended |
Aug. 31, 2019USD ($)$ / shares$ / itemshares | Dec. 31, 2019USD ($) | |
Capped Calls | ||
Purchase of capped calls | $ 25,159 | |
Equity component of issuance costs for convertible senior notes | $ 2,092 | |
Capped Calls with Respect to 2024 Convertible Notes and 2026 Convertible Notes | ||
Capped Calls | ||
Payment made to enter into Capped Calls | $ 25,200 | |
Strike price (in dollars per share) | $ / shares | $ 13.39 | |
Cap price | $ / item | 17.05 | |
Number of shares covered by capped calls (in shares) | shares | 29,867,480 | |
Purchase of capped calls | $ 25,000 | |
Equity component of issuance costs for convertible senior notes | $ 200 |
Commitments and Contingencies -
Commitments and Contingencies - Guarantees (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Indemnification Agreement | ||
Guarantees | ||
Liabilities recorded | $ 0 | $ 0 |
Stockholders' Equity - Common S
Stockholders' Equity - Common Stock (Details) | 12 Months Ended |
Dec. 31, 2021Vote | |
Common stock | |
Number of voting rights per share | 1 |
Description of the number of voting rights per share | Class A Common Stock is entitled to one vote per share. |
Stockholders' Equity - Stock Re
Stockholders' Equity - Stock Repurchase Program (Details) - USD ($) $ in Thousands, shares in Millions | 1 Months Ended | 12 Months Ended |
May 31, 2021 | Dec. 31, 2021 | |
Stock Repurchase Program | ||
Stock repurchase program, authorized amount | $ 150,000 | |
Stock repurchase program, expiration date | Dec. 31, 2022 | |
Common stock repurchased and retired (in shares) | 2.4 | |
Common stock repurchased and retired | $ 27,139 | |
Stock repurchase program, remaining authorized repurchase amount | $ 122,900 |
Employee Stock Benefit Plans -
Employee Stock Benefit Plans - Summary of Expense Recognized by Share-based Compensation Arrangement (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Employee Stock Benefit Plans | |||
Expense recognized for share-based compensation arrangements | $ 22,281 | $ 31,175 | $ 31,278 |
Employee stock options | |||
Employee Stock Benefit Plans | |||
Expense recognized for share-based compensation arrangements | 3,154 | 7,680 | 12,526 |
Time-based Restricted Stock Units | |||
Employee Stock Benefit Plans | |||
Expense recognized for share-based compensation arrangements | 14,539 | 18,624 | 15,488 |
Performance-based Restricted Stock Units | |||
Employee Stock Benefit Plans | |||
Expense recognized for share-based compensation arrangements | 1,295 | 2,190 | |
Restricted Stock | |||
Employee Stock Benefit Plans | |||
Expense recognized for share-based compensation arrangements | 2,684 | 1,886 | 2,095 |
Employee Stock | |||
Employee Stock Benefit Plans | |||
Expense recognized for share-based compensation arrangements | 419 | 722 | 1,115 |
Stock awards | |||
Employee Stock Benefit Plans | |||
Expense recognized for share-based compensation arrangements | $ 190 | $ 73 | $ 54 |
Employee Stock Benefit Plans _2
Employee Stock Benefit Plans - Share-based Compensation Reflected in the Consolidated Statement of Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Employee Stock Benefit Plans | |||
Share-based compensation expense | $ 22,281 | $ 31,175 | $ 31,278 |
Research and development | |||
Employee Stock Benefit Plans | |||
Share-based compensation expense | 4,849 | 5,569 | 6,343 |
Selling, general and administrative | |||
Employee Stock Benefit Plans | |||
Share-based compensation expense | 17,323 | 23,825 | 24,281 |
Restructuring expenses | |||
Employee Stock Benefit Plans | |||
Share-based compensation expense | $ 109 | $ 1,781 | $ 654 |
Employee Stock Benefit Plans _3
Employee Stock Benefit Plans - Separation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Employee Stock Benefit Plans | |||
Share-based compensation expense | $ 22,281 | $ 31,175 | $ 31,278 |
Employee Stock | |||
Employee Stock Benefit Plans | |||
Share-based compensation expense | $ 419 | $ 722 | 1,115 |
Spin-off | Share-based Payment Awards, Excluding Employee Stock Purchase Plan | |||
Employee Stock Benefit Plans | |||
Share-based compensation expense | 0 | ||
Spin-off | Employee Stock | |||
Employee Stock Benefit Plans | |||
Share-based compensation expense | $ 300 |
Employee Stock Benefit Plans _4
Employee Stock Benefit Plans - Stock Benefit Plans (Details) - shares | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2010 | |
2010 Plan | Employee Stock | ||
Stock Benefit Plans | ||
Purchase price as a percentage of fair market value of a share of common stock on the first or last day of an offering period (as a percent) | 85.00% | |
Offering period | 6 months | |
Shares reserved for issuance (in shares) | 400,000 | |
Threshold number of additional shares available for future grant (in shares) | 1,000,000 | |
Shares available for future grant (in shares) | 4,571,500 | |
2010 Plan | Employee Stock | Class A common stock | ||
Stock Benefit Plans | ||
Percentage for the threshold number of additional shares available for future grant, expressed as percentage of common stock outstanding on the last day of the immediately preceding fiscal year (as a percent) | 1.00% | |
2019 Equity plan | ||
Stock Benefit Plans | ||
Shares available for future grant (in shares) | 8,773,291 | |
2019 Equity plan | Class A common stock | ||
Stock Benefit Plans | ||
Shares reserved for issuance (in shares) | 10,000,000 | |
2005 Equity Plan | ||
Stock Benefit Plans | ||
Shares available for future grant (in shares) | 0 | |
2019 Equity Plan and 2010 Purchase Plan | ||
Stock Benefit Plans | ||
Shares available for future grant (in shares) | 13,344,791 |
Employee Stock Benefit Plans _5
Employee Stock Benefit Plans - Restricted Stock Awards - Activity (Details) - Restricted Stock - $ / shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Number of Shares | |||
Outstanding at the beginning of the period (in shares) | 246,500 | ||
Granted (in shares) | 230,160 | ||
Vested and released (in shares) | (213,400) | ||
Outstanding at the end of the period (in shares) | 263,260 | 246,500 | |
Weighted-Average Grant Date Fair Value | |||
Outstanding at the beginning of the period (in dollars per share) | $ 10.38 | ||
Granted (in dollars per share) | 11.67 | $ 10.16 | $ 10.96 |
Vested and released (in dollars per share) | 11.58 | ||
Outstanding at the end of the period (in dollars per share) | $ 11.61 | $ 10.38 |
Employee Stock Benefit Plans _6
Employee Stock Benefit Plans - Restricted Stock Awards - Weighted-average Grant Date Fair Value (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Restricted Stock | |||
Weighted-Average Grant Date Fair Value | |||
Weighted-average grant date fair value (in dollars per share) | $ 11.67 | $ 10.16 | $ 10.96 |
Employee Stock Benefit Plans _7
Employee Stock Benefit Plans - Restricted Stock Units (Details) | 12 Months Ended |
Dec. 31, 2019shares | |
Restricted Stock Units | |
Stock Benefit Plans | |
Right to number of shares of common stock per RSU (in shares) | 1 |
Employee Stock Benefit Plans _8
Employee Stock Benefit Plans - Time-based RSUs - Vesting (Details) - Time-based Restricted Stock Units | 12 Months Ended |
Dec. 31, 2021 | |
Minimum | |
Stock Benefit Plans | |
Vesting period | 2 years |
Maximum | |
Stock Benefit Plans | |
Vesting period | 4 years |
Employee Stock Benefit Plans _9
Employee Stock Benefit Plans - Time-based RSUs - Activity (Details) - Time-based Restricted Stock Units - $ / shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Number of Shares | |||
Outstanding at the beginning of the period (in shares) | 4,170,626 | ||
Granted (in shares) | 2,707,427 | ||
Vested and released (in shares) | (1,697,745) | ||
Forfeited (in shares) | (1,316,200) | ||
Outstanding at the end of the period (in shares) | 3,864,108 | 4,170,626 | |
Weighted-Average Grant Date Fair Value | |||
Outstanding at the beginning of the period (in dollars per share) | $ 11.90 | ||
Granted (in dollars per share) | 10.40 | $ 11.59 | $ 12.11 |
Vested and released (in dollars per share) | 12.18 | ||
Forfeited (in dollars per share) | 11.38 | ||
Outstanding at the end of the period (in dollars per share) | $ 10.89 | $ 11.90 |
Employee Stock Benefit Plans_10
Employee Stock Benefit Plans - Time-based RSUs - Weighted-average Grant Date Fair Value (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Time-based Restricted Stock Units | |||
Weighted-Average Grant Date Fair Value | |||
Weighted-average grant date fair value (in dollars per share) | $ 10.40 | $ 11.59 | $ 12.11 |
Employee Stock Benefit Plans_11
Employee Stock Benefit Plans - Performance-based RSUs - Vesting (Details) - Performance-based Restricted Stock Units | 12 Months Ended |
Dec. 31, 2021 | |
Share-based Payment Arrangement, Tranche One | |
Stock Benefit Plans | |
Vesting period | 2 years |
Share-based Payment Arrangement, Tranche Two | |
Stock Benefit Plans | |
Vesting period | 3 years |
Employee Stock Benefit Plans_12
Employee Stock Benefit Plans - Performance-based RSUs - Assumptions (Details) - Performance-based Restricted Stock Units | 12 Months Ended |
Dec. 31, 2021$ / shares | |
Weighted-average assumptions used to estimate fair value | |
Fair value of common stock (in dollars per share) | $ 11.39 |
Expected volatility (as a percent) | 47.90% |
Expected term | 2 years 7 months 6 days |
Risk-free interest rate (as a percent) | 0.30% |
Expected dividend yield (as a percent) | 0.00% |
Employee Stock Benefit Plans_13
Employee Stock Benefit Plans - Performance-based RSUs - Activity (Details) - Performance-based Restricted Stock Units | 12 Months Ended |
Dec. 31, 2021$ / sharesshares | |
Number of Shares | |
Outstanding at the beginning of the period (in shares) | shares | 586,157 |
Granted (in shares) | shares | 661,651 |
Forfeited (in shares) | shares | (414,522) |
Outstanding at the end of the period (in shares) | shares | 833,286 |
Weighted-Average Grant Date Fair Value | |
Outstanding at the beginning of the period (in dollars per share) | $ / shares | $ 12.48 |
Granted (in dollars per share) | $ / shares | 14.65 |
Forfeited (in dollars per share) | $ / shares | 12.76 |
Outstanding at the end of the period (in dollars per share) | $ / shares | $ 14.06 |
Employee Stock Benefit Plans_14
Employee Stock Benefit Plans - Performance-based RSUs - Weighted-average Grant Date Fair Value (Details) | 12 Months Ended |
Dec. 31, 2021$ / shares | |
Performance-based Restricted Stock Units | |
Weighted-Average Grant Date Fair Value | |
Weighted-average grant date fair value (in dollars per share) | $ 14.65 |
Employee Stock Benefit Plans_15
Employee Stock Benefit Plans - Stock Options - General Information (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Stock Benefit Plans | |
Expiration period | 10 years |
Employee stock options | |
Stock Benefit Plans | |
Vesting period | 4 years |
Employee Stock Benefit Plans_16
Employee Stock Benefit Plans - Stock Options - Assumptions (Details) - Employee stock options | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Weighted-average assumptions used to estimate fair value | |||
Expected volatility (as a percent) | 46.60% | 46.30% | |
Expected term | 6 years 1 month 6 days | 6 years 1 month 6 days | |
Risk-free interest rate (as a percent) | 1.50% | 2.50% | |
Expected dividend yield (as a percent) | 0.00% | 0.00% | 0.00% |
Employee Stock Benefit Plans_17
Employee Stock Benefit Plans - Stock Options - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Stock Benefit Plans | |||
Weighted average grant date fair value (in dollars per share) | $ 5.89 | $ 6.10 | |
Share-based compensation expense | $ 22,281 | $ 31,175 | $ 31,278 |
Employee stock options | |||
Stock Benefit Plans | |||
Share-based compensation expense | $ 3,154 | $ 7,680 | $ 12,526 |
Performance-based milestone options | |||
Stock Benefit Plans | |||
Vested (in shares) | 0 | 0 | 0 |
Employee Stock Benefit Plans_18
Employee Stock Benefit Plans - Stock Options - Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Number of Shares | ||
Outstanding at the beginning of the period (in shares) | 13,459,671 | |
Exercised (in shares) | (1,698,362) | |
Cancelled (in shares) | (2,388,515) | |
Outstanding at the end of the period (in shares) | 9,372,794 | 13,459,671 |
Weighted-Average Exercise Price | ||
Outstanding at the beginning of the period (in dollars per share) | $ 12.25 | |
Exercised (in dollars per share) | 10.83 | |
Cancelled (in dollars per share) | 13.07 | |
Outstanding at the end of the period (in dollars per share) | $ 12.30 | $ 12.25 |
Vested or expected to vest | ||
Number of Shares (in shares) | 9,331,488 | |
Weighted-Average Exercise Price (in dollars per share) | $ 12.31 | |
Weighted Average Contractual Life | 3 years 5 months 26 days | |
Aggregate Intrinsic Value | $ 4,509 | |
Stock options | ||
Weighted Average Contractual Life - Outstanding | 3 years 6 months 3 days | 4 years 3 months 7 days |
Aggregate Intrinsic Value - Outstanding | $ 4,528 | $ 5,613 |
Number of Shares - Exercisable (in shares) | 8,972,651 | |
Weighted-Average Exercise Price - Exercisable (in dollars per share) | $ 12.33 | |
Weighted Average Contractual Life - Exercisable | 3 years 4 months 17 days | |
Aggregate Intrinsic Value - Exercisable | $ 4,385 |
Employee Stock Benefit Plans_19
Employee Stock Benefit Plans - Stock Options - Total Intrinsic Value (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Stock options | |||
Total intrinsic value of options exercised | $ 2.7 | $ 3.5 | $ 5.1 |
Employee Stock Benefit Plans_20
Employee Stock Benefit Plans - Unrecognized Share-based Compensation (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Stock options with time-based vesting | |
Unrecognized share-based compensation | |
Unrecognized expense, net of estimated forfeitures, options | $ 1,541 |
Weighted-average remaining recognition period | 1 year 1 month 20 days |
Restricted Stock | |
Unrecognized share-based compensation | |
Unrecognized expense, net of estimated forfeitures, other than options | $ 1,464 |
Weighted-average remaining recognition period | 7 months 6 days |
Time-based Restricted Stock Units | |
Unrecognized share-based compensation | |
Unrecognized expense, net of estimated forfeitures, other than options | $ 22,545 |
Weighted-average remaining recognition period | 2 years 5 months 15 days |
Performance-based Restricted Stock Units | |
Unrecognized share-based compensation | |
Unrecognized expense, net of estimated forfeitures, other than options | $ 3,816 |
Weighted-average remaining recognition period | 1 year 8 months 26 days |
Income Taxes - Provision for (B
Income Taxes - Provision for (Benefit from) Income Taxes - Tabular Disclosure (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Current: | ||
State | $ 5,503 | $ 2,685 |
Total current | 5,503 | 2,685 |
Deferred Federal, State and Local, Tax Expense (Benefit) [Abstract] | ||
Federal | (251,367) | |
State | (81,927) | |
Total deferred | (333,294) | |
Total income tax (benefit) expense | $ (327,791) | $ 2,685 |
Income Taxes - Provision for _2
Income Taxes - Provision for (Benefit from) Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Taxes | |||
Income tax (benefit) expense | $ (327,791) | $ 2,685 | |
Current: | |||
State | $ 5,503 | 2,685 | |
Federal Income Tax Expense (Benefit) | |||
Income tax expense related to federal income tax | 0 | $ 0 | |
State Income Tax Expense (Benefit) | |||
Income tax expense related to state income tax | $ 2,700 | 0 | |
Foreign Income Tax Expense (Benefit) | |||
Income tax expense related to foreign income tax | $ 0 |
Income Taxes - Federal Statutor
Income Taxes - Federal Statutory Rate (Details) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Effective Income Tax Rate Reconciliation, Percent | |||
Federal statutory rate (as a percent) | 21.00% | 21.00% | 21.00% |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Reconciliation of income taxes | |||
Income tax expense (benefit) using U.S. federal statutory rate | $ 42,138 | $ 22,861 | $ 4,517 |
Permanent differences | 34 | 74 | 65 |
State income taxes, net of federal benefit | 12,554 | 7,565 | (1,902) |
Disallowed separation related costs | 4,658 | ||
Executive compensation - Section 162(m) | 695 | 1,718 | 662 |
Meals and entertainment | 349 | 395 | 495 |
Non-deductible share-based compensation | 43 | (144) | (1,202) |
Excess tax benefits | 6,270 | 5,132 | 3,324 |
Fair market valuation of Note Hedge Warrants and Convertible Note Hedges | 325 | 1,680 | (290) |
Tax credits | (9) | (3,149) | (4,374) |
Expiring net operating losses and tax credits | 491 | 1,991 | 3,764 |
Effect of change in state tax rate on deferred tax assets and deferred tax liabilities | 123 | (208) | (2,563) |
Change in the valuation allowance | (390,804) | (35,230) | $ (7,154) |
Total income tax (benefit) expense | $ (327,791) | $ 2,685 |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred tax assets: | ||
Net operating loss carryforwards | $ 165,022 | $ 234,772 |
Tax credit carryforwards | 60,125 | 60,607 |
Capitalized research and development | 4,981 | 7,498 |
Share-based compensation | 16,857 | 21,848 |
Basis difference on collaboration agreement for North America with AbbVie | 78,194 | 62,629 |
Accruals and reserves | 5,003 | 6,114 |
Basis difference on 2022 Convertible Notes | 8,166 | 6,183 |
Intangible assets | 5,396 | |
Interest expense | 3,386 | |
Operating lease liability | 5,971 | 6,504 |
Other | 3,997 | 5,049 |
Total deferred tax assets | 353,712 | 414,590 |
Deferred tax liabilities: | ||
Basis Difference on 2024 Convertible Notes | (4,363) | (5,951) |
Basis Difference on 2026 Convertible Notes | (7,597) | (9,022) |
Operating lease right-of-use assets | (4,248) | (4,603) |
Total deferred tax liabilities | (16,208) | (19,576) |
Net deferred tax assets | 337,504 | 395,014 |
Valuation allowance | (4,210) | (395,014) |
Net deferred tax asset | $ 333,294 | $ 0 |
Income Taxes - Valuation Allowa
Income Taxes - Valuation Allowance (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Income Taxes | ||
Net deferred tax assets | $ 337,504 | $ 395,014 |
(Decrease) increase in valuation allowance | (390,800) | $ (35,200) |
Release of Valuation Allowance on Majority of Tax Attributes and Other Deferred Tax Assets | ||
Income Taxes | ||
(Decrease) increase in valuation allowance | $ 333,300 |
Income Taxes - Net Operating Lo
Income Taxes - Net Operating Loss Carryforwards (Details) $ in Millions | Dec. 31, 2021USD ($) |
Domestic Tax Authority | |
Net operating loss carryforwards | |
Net operating loss carryforwards | $ 935.4 |
Net operating loss carryforwards, subject to expiration | 805.8 |
Net operating loss carryforwards, indefinite | 129.6 |
State | |
Net operating loss carryforwards | |
Net operating loss carryforwards | $ 718.9 |
Income Taxes - Tax Credit Carry
Income Taxes - Tax Credit Carryforwards (Details) $ in Millions | Dec. 31, 2021USD ($) |
Tax credit carryforward | |
Tax credit carryforward | $ 64.7 |
Income Taxes - Unrecognized Inc
Income Taxes - Unrecognized Income Tax Benefits - Tabular Disclosure (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Unrecognized income tax benefits | |||
Unrecognized Tax Benefits, Beginning Balance | $ 68,087 | $ 53,099 | $ 38,551 |
Increases based on tax positions related to the current period | 83,206 | 66,687 | 51,699 |
Increases for tax positions of prior periods | 1,400 | ||
Decreases for tax positions in prior periods | (66,687) | (51,699) | (38,551) |
Unrecognized Tax Benefits, End Balance | $ 84,606 | $ 68,087 | $ 53,099 |
Income Taxes - Unrecognized I_2
Income Taxes - Unrecognized Income Tax Benefits - Additional Information (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Unrecognized tax benefits | ||||
Unrecognized tax benefits | $ 84,606 | $ 68,087 | $ 53,099 | $ 38,551 |
Amount of unrecognized tax benefits that, if recognized, would affect effective tax rate | 1,400 | |||
Reserve for uncertain tax positions recorded in other liabilities | $ 2,900 |
Defined Contribution Plan (Deta
Defined Contribution Plan (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Defined Contribution Plan | |||
Matching contribution, percentage of employee contribution (as a percent) | 75.00% | 75.00% | |
Matching contribution, annual employee contribution limit, amount | $ 6,000 | $ 6,000 | |
Compensation cost | $ 2,200,000 | $ 1,800,000 | $ 2,200,000 |
Minimum | |||
Defined Contribution Plan | |||
Employee contribution per calendar year (as a percent of compensation) | 1.00% | ||
Maximum | |||
Defined Contribution Plan | |||
Employee contribution per calendar year (as a percent of compensation) | 100.00% | ||
Ironwood Pharmaceuticals, Inc 401(k) Savings Plan, Matching Contributions, 100 Percent on First 3 Percent and 50 Percent on Next 3 Percent, 100 Percent on First 3 Percent | |||
Defined Contribution Plan | |||
Matching contribution, percent of match (as a percent) | 100.00% | ||
Matching contribution, percent of employees' gross pay (as a percent) | 3.00% | ||
Ironwood Pharmaceuticals, Inc 401(k) Savings Plan, Matching Contributions, 100 Percent on First 3 Percent and 50 Percent on Next 3 Percent, 50 Percent on Next 3 Percent | |||
Defined Contribution Plan | |||
Matching contribution, percent of match (as a percent) | 50.00% | ||
Matching contribution, percent of employees' gross pay (as a percent) | 3.00% | ||
Ironwood Pharmaceuticals, Inc 401(k) Savings Plan, Matching Contributions, 75 Percent on First $10,000, up to $7,500 | |||
Defined Contribution Plan | |||
Matching contribution, percentage of employee contribution (as a percent) | 75.00% | ||
Matching contribution, annual employee eligible contribution limit, amount | $ 10,000 | ||
Matching contribution, annual employee contribution limit, amount | $ 7,500 |
Workforce Reduction and Restr_3
Workforce Reduction and Restructuring - Restructuring Expenses (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Restructuring Expenses | |||
Charges | $ 1,073 | $ 15,400 | $ 3,600 |
Workforce Reduction and Restr_4
Workforce Reduction and Restructuring - General Information (Details) $ in Millions | 1 Months Ended | 12 Months Ended | |||
Sep. 30, 2020employee | Feb. 28, 2019employee | Aug. 31, 2018employee | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Reduction in Workforce, Termination of Lesinurad License Agreement, August 16, 2018 | |||||
Workforce Reduction | |||||
Number of employees expected to be eliminated | employee | 100 | ||||
Reduction in Workforce, February 7, 2019 | |||||
Workforce Reduction | |||||
Number of employees expected to be eliminated | employee | 35 | ||||
Restructuring Expenses | |||||
Employee severance, benefits and related costs | $ | $ 3.7 | ||||
Reduction in Workforce, Discontinued Development of IW-3718, September 29, 2020 | |||||
Workforce Reduction | |||||
Number of employees expected to be eliminated | employee | 100 | ||||
Restructuring Expenses | |||||
Restructuring expenses and impairment of certain fixed assets | $ | $ 15.5 | ||||
Impairment of Long-Lived Assets | |||||
Impairment of long-lived assets | $ | $ 1.2 |
Workforce Reduction and Restr_5
Workforce Reduction and Restructuring - Tabular Disclosure (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Workforce Reduction | |||
Balance at beginning of period | $ 10,907 | ||
Charges | 1,073 | $ 15,400 | $ 3,600 |
Amounts paid | (10,664) | ||
Adjustments | (854) | ||
Balance at end of period | 462 | 10,907 | |
Employee severance, benefits and related costs | |||
Workforce Reduction | |||
Balance at beginning of period | 10,902 | 75 | |
Charges | 1,025 | 11,563 | |
Amounts paid | (10,611) | (736) | |
Adjustments | (854) | ||
Balance at end of period | 462 | 10,902 | 75 |
Employee severance, benefits and related costs | Reduction in Workforce, February 7, 2019 | |||
Workforce Reduction | |||
Balance at beginning of period | 0 | 75 | |
Amounts paid | (75) | ||
Balance at end of period | 0 | 75 | |
Employee severance, benefits and related costs | Reduction in Workforce, Discontinued Development of IW-3718, September 29, 2020 | |||
Workforce Reduction | |||
Balance at beginning of period | 10,902 | 0 | |
Charges | 11,563 | ||
Amounts paid | (661) | ||
Balance at end of period | 10,902 | 0 | |
Contract related costs | |||
Workforce Reduction | |||
Balance at beginning of period | 5 | 104 | |
Charges | 48 | 108 | |
Amounts paid | (53) | (103) | |
Adjustments | (104) | ||
Balance at end of period | 0 | 5 | 104 |
Contract related costs | Reduction in Workforce, Termination of Lesinurad License Agreement, August 16, 2018 | |||
Workforce Reduction | |||
Balance at beginning of period | 0 | 104 | |
Adjustments | (104) | ||
Balance at end of period | 0 | 104 | |
Contract related costs | Reduction in Workforce, Discontinued Development of IW-3718, September 29, 2020 | |||
Workforce Reduction | |||
Balance at beginning of period | $ 5 | 0 | |
Charges | 108 | ||
Amounts paid | (103) | ||
Balance at end of period | $ 5 | $ 0 |
Selected Quarterly Financial _3
Selected Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Selected Quarterly Financial Data | |||||||||||
Total revenues | $ 117,130 | $ 103,747 | $ 104,031 | $ 88,845 | $ 116,680 | $ 103,468 | $ 89,432 | $ 79,943 | $ 413,753 | $ 389,523 | $ 428,413 |
Total cost and expenses | 60,538 | 38,576 | 38,933 | 43,447 | 65,296 | 57,852 | 56,719 | 66,716 | 181,494 | 246,583 | 308,290 |
Other expense, net | (10,337) | (5,499) | (10,726) | (5,040) | (6,884) | (9,804) | (7,509) | (9,882) | (31,602) | (34,079) | (61,180) |
Net income | 41,374 | 55,845 | 391,303 | 39,926 | 43,204 | 34,423 | 25,204 | 3,345 | 528,448 | 106,176 | 21,505 |
Comprehensive income | $ 41,374 | $ 55,845 | $ 391,303 | $ 39,926 | $ 43,204 | $ 34,423 | $ 25,204 | $ 3,345 | $ 528,448 | $ 106,176 | $ 21,505 |
Net income per share - basic (in dollars per share) | $ 0.25 | $ 0.34 | $ 2.42 | $ 0.25 | $ 0.27 | $ 0.22 | $ 0.16 | $ 0.02 | $ 3.26 | $ 0.67 | $ 0.14 |
Net income per share - diluted (in dollars per share) | $ 0.25 | $ 0.34 | $ 2.39 | $ 0.25 | $ 0.27 | $ 0.21 | $ 0.16 | $ 0.02 | $ 3.21 | $ 0.66 | $ 0.14 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions | 2 Months Ended | 12 Months Ended |
Feb. 15, 2022 | Dec. 31, 2021 | |
Subsequent Event | ||
Common stock repurchased and retired (in shares) | 2.4 | |
Common stock repurchased and retired | $ 27,139 | |
Subsequent Event | ||
Subsequent Event | ||
Common stock repurchased and retired (in shares) | 4.5 | |
Common stock repurchased and retired, weighted-average price (in dollars per share) | $ 11.27 | |
Common stock repurchased and retired | $ 50,700 |