Tesaro (TSRO) 10-Q 8 Nov 13 2013 Q3 Quarterly report Financial data

Document_and_Entity_Informatio

Document and Entity Information	9 Months Ended
	Sep. 30, 2013	Nov. 07, 2013
Document and Entity Information	'	'
Entity Registrant Name	'TESARO, Inc.	'
Entity Central Index Key	'0001491576	'
Document Type	'10-Q	'
Document Period End Date	30-Sep-13	'
Amendment Flag	'false	'
Current Fiscal Year End Date	'--12-31	'
Entity Current Reporting Status	'Yes	'
Entity Filer Category	'Non-accelerated Filer	'
Entity Common Stock, Shares Outstanding	'	32,735,555
Document Fiscal Year Focus	'2013	'
Document Fiscal Period Focus	'Q3	'

Condensed_Consolidated_Balance

Condensed Consolidated Balance Sheets (USD $)	Sep. 30, 2013	Dec. 31, 2012
In Thousands, unless otherwise specified
Current assets:	'	'
Cash and cash equivalents	$156,440	$125,445
Other current assets	1,499	1,175
Total current assets	157,939	126,620
Property and equipment, net	472	219
Other assets	836	541
Total assets	159,247	127,380
Current liabilities:	'	'
Accounts payable	1,989	3,170
Accrued expenses	13,511	8,545
Other current liabilities	13	3
Total current liabilities	15,513	11,718
Other non-current liabilities	6	'
Commitments and contingencies (Note 7)	'	'
Stockholders' equity:	'	'
Preferred stock, $0.0001 par value; 10,000,000 shares authorized at both December 31, 2012 and September 30, 2013; no shares issued and outstanding at both December 31, 2012 and September 30, 2013	'	'
Common stock, $0.0001 par value; 100,000,000 shares authorized at both December 31, 2012 and September 30, 2013; 27,136,329 and 32,735,555 shares issued and outstanding at December 31, 2012 and September 30, 2013, respectively	3	3
Additional paid-in capital	299,883	202,795
Deficit accumulated during the development stage	-156,158	-87,136
Total stockholders' equity	143,728	115,662
Total liabilities and stockholders' equity	$159,247	$127,380

Condensed_Consolidated_Balance1

Condensed Consolidated Balance Sheets (Parenthetical) (USD $)	Sep. 30, 2013	Dec. 31, 2012
Condensed Consolidated Balance Sheets	'	'
Preferred stock, par value (in dollars per share)	$0.00	$0.00
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$0.00	$0.00
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	32,735,555	27,136,329
Common stock, shares outstanding	32,735,555	27,136,329

Condensed_Consolidated_Stateme

Condensed Consolidated Statements of Operations and Comprehensive Loss (USD $)	3 Months Ended		9 Months Ended		42 Months Ended
In Thousands, except Per Share data, unless otherwise specified	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013
Expenses:	'	'	'	'	'
Research and development	$22,163	$11,876	$56,843	$31,558	$115,857
General and administrative	4,503	1,736	10,315	4,620	21,856
Acquired in-process research and development	1,940	'	1,940	7,000	17,070
Total expenses	28,606	13,612	69,098	43,178	154,783
Loss from operations	-28,606	-13,612	-69,098	-43,178	-154,783
Interest income	17	53	76	112	286
Other expense, net	'	'	'	'	-1,661
Net loss	-28,589	-13,559	-69,022	-43,066	-156,158
Net loss per share applicable to common stockholders - basic and diluted (in dollars per share)	($0.88)	($0.52)	($2.21)	($4.62)	($14.51)
Weighted-average number of common shares used in net loss per share applicable to common stockholders - basic and diluted (in shares)	32,453	26,130	31,209	9,316	10,759
Comprehensive loss	($28,589)	($13,559)	($69,022)	($43,066)	($156,158)

Condensed_Consolidated_Stateme1

Condensed Consolidated Statements of Cash Flows (USD $)	9 Months Ended		42 Months Ended
In Thousands, unless otherwise specified	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013
Operating activities	'	'	'
Net loss	($69,022)	($43,066)	($156,158)
Adjustments to reconcile net loss to net cash used in operating activities:	'	'	'
Acquired in-process research and development	1,940	7,000	17,070
Depreciation expense	130	43	236
Increase in fair value of investor rights obligation	'	'	1,661
Stock-based compensation expense	5,078	1,006	7,186
Changes in operating assets and liabilities:	'	'	'
Other assets	-619	489	-2,335
Accounts payable	-1,181	1,272	1,989
Accrued expenses	4,966	2,797	13,511
Other liabilities	16	-8	19
Net cash used in operating activities	-58,692	-30,467	-116,821
Investing activities	'	'	'
Acquisition of product candidate licenses and milestone payments	-1,940	-7,000	-16,440
Purchase of property and equipment	-383	-98	-708
Net cash used in investing activities	-2,323	-7,098	-17,148
Financing activities	'	'	'
Proceeds from sale of common stock, net of issuance costs	91,312	77,960	169,272
Proceeds from exercise of stock options	633	11	666
Proceeds from issuance of common stock under Employee Stock Purchase Plan	65	'	65
Proceeds from sale of convertible preferred stock and related investor rights, net of issuance costs	'	58,349	120,406
Net cash provided by financing activities	92,010	136,320	290,409
Increase in cash and cash equivalents	30,995	98,755	156,440
Cash and cash equivalents at beginning of period	125,445	39,825	'
Cash and cash equivalents at end of period	156,440	138,580	156,440
Non-cash investing and financing activities	'	'	'
Issuance of Series O convertible preferred stock	'	'	630
Settlement of investor rights obligation	'	'	3,829
Conversion of convertible preferred stock to common stock	'	$122,697	$122,697

Description_of_Business

Description of Business	9 Months Ended
	Sep. 30, 2013
Description of Business	'
Description of Business	'
	1.                                      Description of Business
	TESARO, Inc. (the “Company” or “TESARO”) is a development stage company that was incorporated in Delaware on March 26, 2010 and commenced operations in May 2010.  TESARO is headquartered in Waltham, Massachusetts.
	TESARO is an oncology-focused biopharmaceutical company dedicated to improving the lives of cancer patients by acquiring, developing and commercializing safer and more effective therapeutics in the United States, Europe and other international markets.  Since incorporation, primary activities have consisted of acquiring product candidates, advancing development of its product candidates, developing intellectual property, recruiting personnel and raising capital.  The Company intends to in-license or acquire additional product candidates across various stages of development.  The Company has never earned revenue from its activities, and, accordingly, the Company is considered to be in the development stage as of September 30, 2013.  The Company is subject to a number of risks similar to those of other development stage companies, including dependence on key individuals, the need to develop commercially viable products, competition from other companies, many of whom are larger and better capitalized, and the need to obtain adequate additional financing to fund the development of its product candidates and further its in-licensing and acquisition activities.
	The Company has incurred significant operating losses since inception and has relied on its ability to fund its operations through public and private equity financings, and management expects operating losses and negative operating cash flows to continue for the foreseeable future.  As the Company continues to incur losses, transition to profitability is dependent upon the successful development, approval, and commercialization of its product candidates and achieving a level of revenues adequate to support the Company’s cost structure.  The Company may never achieve profitability, and unless and until it does, the Company will continue to need to raise additional capital.  Management intends to fund future operations through additional public or private equity or debt offerings, and may seek additional capital through arrangements with strategic partners or from other sources.

Basis_of_Presentation_and_Sign

Basis of Presentation and Significant Accounting Policies	9 Months Ended
	Sep. 30, 2013
Basis of Presentation and Significant Accounting Policies	'
Basis of Presentation and Significant Accounting Policies	'
	2.                                      Basis of Presentation and Significant Accounting Policies
	Basis of Presentation
	The accompanying condensed consolidated financial statements are unaudited and have been prepared by TESARO in accordance with accounting principles generally accepted in the United States of America (“GAAP”).
	The condensed consolidated financial statements reflect the operations of the Company and its wholly-owned subsidiaries: TESARO UK Limited; TESARO Securities Corporation; and TESARO Development, Ltd.  All significant intercompany balances and transactions have been eliminated.  The Company currently operates in one business segment, which is the identification, acquisition, development and commercialization of oncology therapeutics and supportive care product candidates, and a single reporting and operating unit structure.
	Certain information and footnote disclosures normally included in the Company’s annual financial statements have been condensed or omitted.  These interim financial statements, in the opinion of management, reflect all normal recurring adjustments necessary for a fair presentation of the Company’s financial position and results of operations for the interim periods ended September 30, 2012 and 2013.
	The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for the full fiscal year.  These interim financial statements should be read in conjunction with the audited financial statements as of and for the year ended December 31, 2012 and the notes thereto, which are included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012.
	Recent Accounting Pronouncements
	In March 2013, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2013-05, which requires a parent company to release any related cumulative translation adjustment into net income only if a sale or transfer results in the complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets had resided.  This guidance is effective prospectively for fiscal years beginning after December 15, 2013.  Early adoption and retrospective application are permitted.  The Company expects to adopt this guidance effective January 1, 2014 and does not expect this adoption to have a material effect on its condensed consolidated financial statements.
	In July 2013, the FASB issued ASU No. 2013-11, which requires entities to present an unrecognized tax benefit, or a portion of an unrecognized tax benefit, as a reduction to a deferred tax asset for a net operating loss carryforward or a similar tax loss or a tax credit carryforward, unless certain conditions exist.  This guidance is effective prospectively for fiscal years beginning after December 15, 2013.  Early adoption and retrospective application are permitted.  The Company expects to adopt this guidance effective January 1, 2014 and does not expect this adoption to have a material effect on its condensed consolidated financial statements.
	Use of Estimates and Assumptions
	The preparation of condensed consolidated financial statements in accordance with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets, liabilities, expenses, other comprehensive income and related disclosures.  The most significant estimates and assumptions are used in, among other things, estimating research and development expense accruals and stock-based compensation expense.  The Company bases its estimates on historical experience and other market-specific or other relevant assumptions that it believes to be reasonable under the circumstances.  Actual results may differ from those estimates or assumptions.
	Cash and Cash Equivalents
	The Company considers all highly liquid investments with original or remaining maturity from the date of purchase of three months or less to be cash equivalents.  Cash and cash equivalents include bank demand deposits and money market funds that invest primarily in certificate of deposits, commercial paper and U.S. government and U.S. government agency obligations.  Cash equivalents are reported at fair value.
	Fair Value of Financial Instruments
	The Company is required to disclose information on all assets and liabilities reported at fair value that enables an assessment of the inputs used in determining the reported fair values.  The fair value hierarchy prioritizes valuation inputs based on the observable nature of those inputs.  The fair value hierarchy applies only to the valuation inputs used in determining the reported fair value of the investments and is not a measure of the investment credit quality.  The hierarchy defines three levels of valuation inputs:
	Level 1 inputs	Quoted prices in active markets for identical assets or liabilities.
	Level 2 inputs	Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
	Level 3 inputs	Unobservable inputs that reflect the Company’s own assumptions about the assumptions market participants would use in pricing the asset or liability.
	The following table presents information about the Company’s financial assets and liabilities that have been measured at fair value as of December 31, 2012 and September 30, 2013 and indicates the fair value hierarchy of the valuation inputs utilized to determine such fair value (in thousands):
				Quoted Prices in		Significant Other		Significant
				Active Markets		Observable Inputs		Unobservable Inputs
	Description	Total		(Level 1)		(Level 2)		(Level 3)
	December 31, 2012
	Money market funds	$	123,888	$	123,888	$	—	$	—
		$	123,888	$	123,888	$	—	$	—
	September 30, 2013
	Money market funds	$	155,797	$	155,797	$	—	$	—
		$	155,797	$	155,797	$	—	$	—
	The carrying amounts of accounts payable and accrued expenses approximate their fair values due to their short-term maturities.
	Research and Development Expenses
	Research and development costs are charged to expense as incurred and include:
	·                  license fees related to the acquisition of in-licensed products, which are reported on the statements of operations as acquired in-process research and development;
	·                  employee-related expenses, including salaries, bonuses, benefits, travel and stock-based compensation expense;
	·                  expenses incurred under agreements with contract research organizations, investigative sites and research consortia in connection with the conduct of clinical trials and preclinical studies and related services, such as administrative, data management and biostatistics services;
	·                  the cost of acquiring, developing and manufacturing clinical trial and other research and development materials;
	·                  facilities, depreciation and other expenses, which include direct and allocated expenses for rent and maintenance of facilities, insurance and other supplies; and
	·                  costs associated with other preclinical activities and regulatory operations.
	Costs for certain development activities, such as clinical trials, are recognized based on an evaluation of the progress to completion of specific tasks using data such as patient enrollment, clinical site activations, or information provided to the Company by vendors on their actual costs incurred.  Payments for these activities are based on the terms of the individual arrangements, which may differ from the pattern of costs incurred, and are reflected in the financial statements as prepaid or accrued research and development expenses.
	Acquired In-Process Research and Development Expense
	The Company has acquired the rights to develop and commercialize new product candidates.  The up-front payments to acquire a new drug compound, as well as milestone payments, are immediately expensed as acquired in-process research and development in the period in which they are incurred, provided that the new drug compound did not also include processes or activities that would constitute a “business”, the drug has not achieved regulatory approval for marketing and, absent obtaining such approval, has no alternative future use.
	Stock-Based Compensation
	Stock-based compensation is recognized as expense for all stock-based awards based on estimated fair values.  The Company determines equity-based compensation at the grant date using the Black-Scholes option pricing model.  The value of the award that is ultimately expected to vest is recognized as expense on a straight-line basis over the requisite service period.  The cumulative effect of any changes to the estimated forfeiture rates would be recognized as an adjustment to compensation cost in the period of the change.

Net_Loss_per_Share

Net Loss per Share	9 Months Ended
	Sep. 30, 2013
Net Loss per Share	'
Net Loss per Share	'
	3.                                      Net Loss per Share
	Basic and diluted net loss per common share is calculated by dividing net loss by the weighted-average number of common shares outstanding during the period, without consideration of common stock equivalents.  The Company’s potentially dilutive shares, which includes preferred stock in the periods in which it was outstanding, outstanding stock options and unvested restricted stock are considered to be common stock equivalents and are only included in the calculation of diluted net loss per share when their effect is dilutive.
	The share amounts in the table below were excluded from the calculation of diluted net loss per share for the relevant periods during 2012 and 2013, prior to the use of the treasury stock method, due to their anti-dilutive effect (in thousands):
		As of September 30,
		2012	2013
	Outstanding stock options	2,069	2,819
	Unvested and/or restricted stock	411	164
		2,480	2,983

StockBased_Compensation

Stock-Based Compensation	9 Months Ended
	Sep. 30, 2013
Stock-Based Compensation	'
Stock-Based Compensation	'
	4.                                      Stock-Based Compensation
	The Company maintains several equity compensation plans, including the 2012 Omnibus Incentive Plan (the “2012 Incentive Plan”), the 2010 Stock Incentive Plan (the “2010 Incentive Plan”), and the 2012 Employee Stock Purchase Plan (the “2012 ESPP”).
	On April 27, 2012, the stockholders of the Company approved the 2012 Incentive Plan, which had been previously adopted by the board of directors.  Upon effectiveness of the 2012 Incentive Plan, the Company ceased making awards under the 2010 Incentive Plan. The 2012 Incentive Plan allows the Company to grant awards for up to 1,428,571 shares of common stock plus the number of shares of common stock available for grant under the 2010 Incentive Plan as of the effectiveness of the 2012 Incentive Plan (which was an additional 6,857 shares) plus that number of shares of common stock related to awards outstanding under the 2010 Incentive Plan that terminate by expiration, forfeiture, cancellation, cash settlement or otherwise.  Each year starting with 2014, the number of shares available for grants of awards under the 2012 Incentive Plan will be increased automatically on January 1 by a number of shares of common stock equal to the lesser of 4% of the shares of common stock outstanding at such time or the number of shares determined by the Company’s board of directors.  Awards under the 2012 Incentive Plan may include the following award types: stock options, which may be either incentive stock options or nonqualified stock options; stock appreciation rights; restricted stock; restricted stock units; dividend equivalent rights; performance shares; performance units; cash-based awards; other stock-based awards, including unrestricted shares; or any combination of the foregoing.  As of September 30, 2013, the Company has granted stock options covering an aggregate of 1,255,379 shares of common stock and 22,126 common stock awards under the 2012 Incentive Plan.  The exercise price of each option has been equal to the closing price of a share of the Company’s common stock on the grant date or the fair value as determined by the board of directors on the grant date.  In addition, as of September 30, 2013, 12,068 options have been exercised and 23,756 options have been cancelled under the 2012 Incentive Plan.
	Prior to the approval of the 2012 Incentive Plan, the Company granted equity awards under the 2010 Incentive Plan.  As a result of the approval of the 2012 Incentive Plan, in April 2012 the Company ceased making awards under the 2010 Incentive Plan.  Any shares subject to outstanding awards granted under the 2010 Incentive Plan that remained available at that time or that expire or terminate for any reason prior to exercise have been added to the total number of shares available for issuance under the 2012 Incentive Plan.  Under the 2010 Incentive Plan, the Company was authorized to grant equity awards up to an aggregate of 1,981,130 shares of common stock.  As of September 30, 2013, an aggregate of 1,785,703 options and 188,570 restricted stock awards have been granted under the 2010 Incentive Plan.  In addition, as of September 30, 2013, 169,428 options have been exercised and 17,262 options have been cancelled under the 2010 Incentive Plan.
	Stock-based compensation expense as reflected in the Company’s condensed consolidated statements of operations and comprehensive loss was as follows (in thousands):
											The Period from
											March 26, 2010
		Three Months Ended					Nine Months Ended				(Inception) to
		September 30,					September 30,				September 30,
		2012			2013		2012		2013		2013
	Research and development	$	166		$	585	$	317	$	1,379	$	1,969
	General and administrative	274			2,138		689		3,699		5,217
	Total stock-based compensation expense	$	440		$	2,723	$	1,006	$	5,078	$	7,186
	During the three months ended September 30, 2013, the Company’s former Executive Vice President, Chief Financial Officer, Treasurer and Secretary (the “former CFO”) resigned from his employment with the Company effective August 31, 2013 and transitioned to serving the Company as a non-employee consultant.  In accordance with the terms of the 2012 Incentive Plan and the 2010 Incentive Plan, stock awards previously granted to the former CFO under these plans will continue to vest through March 31, 2014 (the term of the Consulting Agreement).  As a result, during the three months ended September 30, 2013, the Company began to account for unvested stock awards previously granted to the former CFO as non-employee awards.  The Company records stock-based compensation expense based on the fair values of awards as measured on their vesting dates, and the fair values of any unvested awards are remeasured at each financial reporting date until they vest, with any increases or decreases in fair value recorded as stock-based compensation expense.  Fair values of stock options are determined on each measurement date using the Black-Scholes option pricing model, and fair values of restricted stock awards are equal to the fair market value of the Company’s common stock on the measurement date.  During the three and nine months ended September 30, 2013, the Company recorded incremental stock-based compensation expense of $0.9 million associated with these awards, as the result of the change in status of the former CFO.
	A summary of the Company’s restricted stock activity and related information is as follows:
				Weighted-average
				fair value
		Shares		per share
	Unvested and/or restricted at December 31, 2012	349,334		$	0.15
	Granted	1,114		46.22
	Vested	(186,028	)	0.1
	Forfeited	—		—
	Unvested and/or restricted at September 30, 2013	164,420		$	0.4
	A summary of the Company’s stock option activity and related information is as follows:
		Shares		Weighted-average
				exercise price per
				share
	Outstanding at December 31, 2012	2,134,185		$	5.52
	Granted	880,025		27.74
	Exercised	(162,480	)	3.9
	Cancelled	(33,162	)	12.81
	Outstanding at September 30, 2013	2,818,568		$	12.47
	At September 30, 2013, there was approximately $0.5 million and $18.7 million of total unrecognized compensation cost related to unvested restricted stock and unvested stock options, respectively.  As of September 30, 2013, the Company expects to recognize these costs over remaining weighted-average periods of 0.5 years and 2.6 years, respectively.
	On June 6, 2012, the board of directors adopted the 2012 ESPP, and the stockholders approved it on June 18, 2012, to be effective in connection with the closing of the Company’s initial public offering.  An aggregate of 275,000 shares of common stock have been reserved for issuance under the 2012 ESPP pursuant to purchase rights granted to the Company’s employees or to employees of the Company’s designated subsidiaries.  During the first offering period under the 2012 ESPP, which ran from January 1, 2013 through June 30, 2013, the Company issued an aggregate of 4,378 shares.  As of September 30, 2013, the Company has recognized approximately $47,000 in related stock-based compensation expense.

Common_Stock_Transactions

Common Stock Transactions	9 Months Ended
	Sep. 30, 2013
Common Stock Transactions	'
Common Stock Transactions	'
	5.                                      Common Stock Transactions
	In March 2013, the Company sold 5,428,000 shares of common stock, $0.0001 par value per share, in an underwritten public offering at a price to the public of $18.00 per share, resulting in gross proceeds of approximately $97.7 million.  Net proceeds to the Company after deducting fees, commissions and other expenses related to the offering were approximately $91.3 million.  The shares were issued pursuant to a registration statement on Form S-1.

Income_Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2013
Income Taxes	'
Income Taxes	'
	6.                                      Income Taxes
	Deferred tax assets and deferred tax liabilities are recognized based on temporary differences between the financial reporting and tax basis of assets and liabilities using statutory rates.  A valuation allowance is recorded against deferred tax assets if it is more likely than not that some or all of the deferred tax assets will not be realized.
	There were no significant income tax provisions or benefits for the three or nine months ended September 30, 2012 and 2013.  Due to the uncertainty surrounding the realization of the favorable tax attributes in future tax returns, the Company has recorded a full valuation allowance against the Company’s otherwise recognizable net deferred tax assets.

Commitments_and_Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2013
Commitments and Contingencies	'
Commitments and Contingencies	'
	7.                                      Commitments and Contingencies
	Effective June 2013, the Company entered into an agreement with a vendor for the hosting of data management software and related services.  Under the agreement, the Company is required to make aggregate minimum payments of approximately $1.2 million through December 31, 2014.  The Company has recognized $0.3 million in expense associated with this agreement as of September 30, 2013.
	Legal Proceedings
	The Company may periodically become subject to legal proceedings and claims arising in connection with on-going business activities, including claims or disputes related to patents that have been issued or that are pending in the field of research on which the Company is focused.  The Company is not a party to any litigation and does not have contingency reserves established for any litigation liabilities.

Basis_of_Presentation_and_Sign1

Basis of Presentation and Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2013
Basis of Presentation and Significant Accounting Policies	'
Basis of Presentation	'
	Basis of Presentation
	The accompanying condensed consolidated financial statements are unaudited and have been prepared by TESARO in accordance with accounting principles generally accepted in the United States of America (“GAAP”).
	The condensed consolidated financial statements reflect the operations of the Company and its wholly-owned subsidiaries: TESARO UK Limited; TESARO Securities Corporation; and TESARO Development, Ltd.  All significant intercompany balances and transactions have been eliminated.  The Company currently operates in one business segment, which is the identification, acquisition, development and commercialization of oncology therapeutics and supportive care product candidates, and a single reporting and operating unit structure.
	Certain information and footnote disclosures normally included in the Company’s annual financial statements have been condensed or omitted.  These interim financial statements, in the opinion of management, reflect all normal recurring adjustments necessary for a fair presentation of the Company’s financial position and results of operations for the interim periods ended September 30, 2012 and 2013.
	The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for the full fiscal year.  These interim financial statements should be read in conjunction with the audited financial statements as of and for the year ended December 31, 2012 and the notes thereto, which are included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012.
Recent Accounting Pronouncements	'
	Recent Accounting Pronouncements
	In March 2013, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2013-05, which requires a parent company to release any related cumulative translation adjustment into net income only if a sale or transfer results in the complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets had resided.  This guidance is effective prospectively for fiscal years beginning after December 15, 2013.  Early adoption and retrospective application are permitted.  The Company expects to adopt this guidance effective January 1, 2014 and does not expect this adoption to have a material effect on its condensed consolidated financial statements.
	In July 2013, the FASB issued ASU No. 2013-11, which requires entities to present an unrecognized tax benefit, or a portion of an unrecognized tax benefit, as a reduction to a deferred tax asset for a net operating loss carryforward or a similar tax loss or a tax credit carryforward, unless certain conditions exist.  This guidance is effective prospectively for fiscal years beginning after December 15, 2013.  Early adoption and retrospective application are permitted.  The Company expects to adopt this guidance effective January 1, 2014 and does not expect this adoption to have a material effect on its condensed consolidated financial statements.
Use of Estimates and Assumptions	'
	Use of Estimates and Assumptions
	The preparation of condensed consolidated financial statements in accordance with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets, liabilities, expenses, other comprehensive income and related disclosures.  The most significant estimates and assumptions are used in, among other things, estimating research and development expense accruals and stock-based compensation expense.  The Company bases its estimates on historical experience and other market-specific or other relevant assumptions that it believes to be reasonable under the circumstances.  Actual results may differ from those estimates or assumptions.
Cash and Cash Equivalents	'
	Cash and Cash Equivalents
	The Company considers all highly liquid investments with original or remaining maturity from the date of purchase of three months or less to be cash equivalents.  Cash and cash equivalents include bank demand deposits and money market funds that invest primarily in certificate of deposits, commercial paper and U.S. government and U.S. government agency obligations.  Cash equivalents are reported at fair value.
Fair Value of Financial Instruments	'
	Fair Value of Financial Instruments
	The Company is required to disclose information on all assets and liabilities reported at fair value that enables an assessment of the inputs used in determining the reported fair values.  The fair value hierarchy prioritizes valuation inputs based on the observable nature of those inputs.  The fair value hierarchy applies only to the valuation inputs used in determining the reported fair value of the investments and is not a measure of the investment credit quality.  The hierarchy defines three levels of valuation inputs:
	Level 1 inputs	Quoted prices in active markets for identical assets or liabilities.
	Level 2 inputs	Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
	Level 3 inputs	Unobservable inputs that reflect the Company’s own assumptions about the assumptions market participants would use in pricing the asset or liability.
	The following table presents information about the Company’s financial assets and liabilities that have been measured at fair value as of December 31, 2012 and September 30, 2013 and indicates the fair value hierarchy of the valuation inputs utilized to determine such fair value (in thousands):
				Quoted Prices in		Significant Other		Significant
				Active Markets		Observable Inputs		Unobservable Inputs
	Description	Total		(Level 1)		(Level 2)		(Level 3)
	December 31, 2012
	Money market funds	$	123,888	$	123,888	$	—	$	—
		$	123,888	$	123,888	$	—	$	—
	September 30, 2013
	Money market funds	$	155,797	$	155,797	$	—	$	—
		$	155,797	$	155,797	$	—	$	—
	The carrying amounts of accounts payable and accrued expenses approximate their fair values due to their short-term maturities.
Research and Development Expenses	'
	Research and Development Expenses
	Research and development costs are charged to expense as incurred and include:
	·                  license fees related to the acquisition of in-licensed products, which are reported on the statements of operations as acquired in-process research and development;
	·                  employee-related expenses, including salaries, bonuses, benefits, travel and stock-based compensation expense;
	·                  expenses incurred under agreements with contract research organizations, investigative sites and research consortia in connection with the conduct of clinical trials and preclinical studies and related services, such as administrative, data management and biostatistics services;
	·                  the cost of acquiring, developing and manufacturing clinical trial and other research and development materials;
	·                  facilities, depreciation and other expenses, which include direct and allocated expenses for rent and maintenance of facilities, insurance and other supplies; and
	·                  costs associated with other preclinical activities and regulatory operations.
	Costs for certain development activities, such as clinical trials, are recognized based on an evaluation of the progress to completion of specific tasks using data such as patient enrollment, clinical site activations, or information provided to the Company by vendors on their actual costs incurred.  Payments for these activities are based on the terms of the individual arrangements, which may differ from the pattern of costs incurred, and are reflected in the financial statements as prepaid or accrued research and development expenses.
Acquired In-Process Research and Development Expense	'
	Acquired In-Process Research and Development Expense
	The Company has acquired the rights to develop and commercialize new product candidates.  The up-front payments to acquire a new drug compound, as well as milestone payments, are immediately expensed as acquired in-process research and development in the period in which they are incurred, provided that the new drug compound did not also include processes or activities that would constitute a “business”, the drug has not achieved regulatory approval for marketing and, absent obtaining such approval, has no alternative future use.
Stock-Based Compensation	'
	Stock-Based Compensation
	Stock-based compensation is recognized as expense for all stock-based awards based on estimated fair values.  The Company determines equity-based compensation at the grant date using the Black-Scholes option pricing model.  The value of the award that is ultimately expected to vest is recognized as expense on a straight-line basis over the requisite service period.  The cumulative effect of any changes to the estimated forfeiture rates would be recognized as an adjustment to compensation cost in the period of the change.

Basis_of_Presentation_and_Sign2

Basis of Presentation and Significant Accounting Policies (Tables)	9 Months Ended
	Sep. 30, 2013
Basis of Presentation and Significant Accounting Policies	'
Schedule of company's financial assets and liabilities that have been measured at fair value and indicating the fair value hierarchy of the valuation inputs utilized to determine such fair value (in thousands):	'
	The following table presents information about the Company’s financial assets and liabilities that have been measured at fair value as of December 31, 2012 and September 30, 2013 and indicates the fair value hierarchy of the valuation inputs utilized to determine such fair value (in thousands):
				Quoted Prices in		Significant Other		Significant
				Active Markets		Observable Inputs		Unobservable Inputs
	Description	Total		(Level 1)		(Level 2)		(Level 3)
	December 31, 2012
	Money market funds	$	123,888	$	123,888	$	—	$	—
		$	123,888	$	123,888	$	—	$	—
	September 30, 2013
	Money market funds	$	155,797	$	155,797	$	—	$	—
		$	155,797	$	155,797	$	—	$	—

Net_Loss_per_Share_Tables

Net Loss per Share (Tables)	9 Months Ended
	Sep. 30, 2013
Net Loss per Share	'
Schedule of share amount excluded from the calculation of diluted net loss per share, prior to the use of the treasury stock method, due to their anti-dilutive effect	'
	The share amounts in the table below were excluded from the calculation of diluted net loss per share for the relevant periods during 2012 and 2013, prior to the use of the treasury stock method, due to their anti-dilutive effect (in thousands):
		As of September 30,
		2012	2013
	Outstanding stock options	2,069	2,819
	Unvested and/or restricted stock	411	164
		2,480	2,983

StockBased_Compensation_Tables

Stock-Based Compensation (Tables)	9 Months Ended
	Sep. 30, 2013
Stock-Based Compensation	'
Schedule of stock-based compensation expense as reflected in the Company's condensed consolidated statements of operations and comprehensive loss	'
	Stock-based compensation expense as reflected in the Company’s condensed consolidated statements of operations and comprehensive loss was as follows (in thousands):
											The Period from
											March 26, 2010
		Three Months Ended					Nine Months Ended				(Inception) to
		September 30,					September 30,				September 30,
		2012			2013		2012		2013		2013
	Research and development	$	166		$	585	$	317	$	1,379	$	1,969
	General and administrative	274			2,138		689		3,699		5,217
	Total stock-based compensation expense	$	440		$	2,723	$	1,006	$	5,078	$	7,186
Summary of the Company's restricted stock activity and related information	'
				Weighted-average
				fair value
		Shares		per share
	Unvested and/or restricted at December 31, 2012	349,334		$	0.15
	Granted	1,114		46.22
	Vested	(186,028	)	0.1
	Forfeited	—		—
	Unvested and/or restricted at September 30, 2013	164,420		$	0.4
Summary of the Company's stock option activity and related information	'
		Shares		Weighted-average
				exercise price per
				share
	Outstanding at December 31, 2012	2,134,185		$	5.52
	Granted	880,025		27.74
	Exercised	(162,480	)	3.9
	Cancelled	(33,162	)	12.81
	Outstanding at September 30, 2013	2,818,568		$	12.47

Basis_of_Presentation_and_Sign3

Basis of Presentation and Significant Accounting Policies (Details) (USD $)	9 Months Ended
In Thousands, unless otherwise specified	Sep. 30, 2013	Sep. 30, 2013	Dec. 31, 2012	Sep. 30, 2013	Dec. 31, 2012	Sep. 30, 2013	Dec. 31, 2012	Sep. 30, 2013	Dec. 31, 2012
	item	Total	Total	Total	Total	Quoted Prices in Active Markets (Level 1)	Quoted Prices in Active Markets (Level 1)	Quoted Prices in Active Markets (Level 1)	Quoted Prices in Active Markets (Level 1)
	segment			Money market funds	Money market funds			Money market funds	Money market funds
Segment Information	'	'	'	'	'	'	'	'	'
Number of operating segments	1	'	'	'	'	'	'	'	'
Fair Value of Financial Instruments	'	'	'	'	'	'	'	'	'
Cash equivalents	'	'	'	$155,797	$123,888	'	'	$155,797	$123,888
Assets	'	$155,797	$123,888	'	'	$155,797	$123,888	'	'
Acquired In-Process Research and Development Expense	'	'	'	'	'	'	'	'	'
Number of processes or activities obtained along with license	0	'	'	'	'	'	'	'	'

Net_Loss_per_Share_Details

Net Loss per Share (Details)	9 Months Ended
In Thousands, unless otherwise specified	Sep. 30, 2013	Sep. 30, 2012
Net Loss per Share	'	'
Amounts excluded from the calculation of diluted net loss per share, prior to the use of the treasury stock method, due to their anti-dilutive effect	2,983	2,480
Outstanding stock options	'	'
Net Loss per Share	'	'
Amounts excluded from the calculation of diluted net loss per share, prior to the use of the treasury stock method, due to their anti-dilutive effect	2,819	2,069
Unvested and/or restricted stock	'	'
Net Loss per Share	'	'
Amounts excluded from the calculation of diluted net loss per share, prior to the use of the treasury stock method, due to their anti-dilutive effect	164	411

StockBased_Compensation_Detail

Stock-Based Compensation (Details)	9 Months Ended				18 Months Ended				42 Months Ended
	Sep. 30, 2013	Sep. 30, 2013	Sep. 30, 2013	Apr. 27, 2012	Sep. 30, 2013	Sep. 30, 2013	Sep. 30, 2013	Sep. 30, 2013	Sep. 30, 2013	Sep. 30, 2013
	Stock options	Restricted deferred common stock awards	2012 Incentive Plan	2012 Incentive Plan	2012 Incentive Plan	2012 Incentive Plan	2012 Incentive Plan	2010 Incentive Plan	2010 Incentive Plan	2010 Incentive Plan
			Common stock	Common stock	Stock options	Stock options	Common stock awards	Common stock	Stock options	Restricted deferred common stock awards
						Common stock
Stock-Based Compensation	'	'	'	'	'	'	'	'	'	'
Number of shares available for grant under the plan	'	'	'	1,428,571	'	'	'	1,981,130	'	'
Number of shares available for future grants that were added to the total number of shares reserved for issuance	'	'	'	6,857	'	'	'	'	'	'
Annual increase in common stock available for grant as a percentage of common stock outstanding	'	'	4.00%	'	'	'	'	'	'	'
Options granted (in shares)	880,025	'	'	'	'	1,255,379	22,126	'	1,785,703	'
Options exercised (in shares)	162,480	'	'	'	12,068	'	'	'	169,428	'
Shares cancelled	33,162	'	'	'	23,756	'	'	'	17,262	'
Restricted stock awards granted (in shares)	'	1,114	'	'	'	'	'	'	'	188,570

StockBased_Compensation_Detail1

Stock-Based Compensation (Details 2) (USD $)	3 Months Ended		9 Months Ended		42 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013
Stock-based compensation expense	'	'	'	'	'
Total stock-based compensation expense	$2,723,000	$440,000	$5,078,000	$1,006,000	$7,186,000
Former CFO	'	'	'	'	'
Stock-based compensation expense	'	'	'	'	'
Incremental stock-based compensation expense	900,000	'	900,000	'	'
Research and development	'	'	'	'	'
Stock-based compensation expense	'	'	'	'	'
Total stock-based compensation expense	585,000	166,000	1,379,000	317,000	1,969,000
General and administrative	'	'	'	'	'
Stock-based compensation expense	'	'	'	'	'
Total stock-based compensation expense	$2,138,000	$274,000	$3,699,000	$689,000	$5,217,000

StockBased_Compensation_Detail2

Stock-Based Compensation (Details 3) (USD $)	9 Months Ended
In Millions, except Share data, unless otherwise specified	Sep. 30, 2013
Restricted stock awards	'
Shares	'
Unvested and/or restricted at the beginning of the period (in shares)	349,334
Granted (in shares)	1,114
Vested (in shares)	-186,028
Unvested and/or restricted at the end of the period (in shares)	164,420
Weighted-average fair value per share	'
Unvested and/or restricted at the beginning of the period (in dollars per share)	$0.15
Granted (in dollars per share)	$46.22
Vested (in dollars per share)	$0.10
Unvested and/or restricted at the end of the period (in dollars per share)	$0.40
Additional disclosure	'
Total unrecognized compensation cost related to unvested restricted stock (in dollars)	$0.50
Weighted average period over which unrecognized compensation costs are expected to be recognized	'6 months
Stock options	'
Shares	'
Outstanding at the beginning of the period (in shares)	2,134,185
Granted (in shares)	880,025
Exercised (in shares)	-162,480
Cancelled (in shares)	-33,162
Outstanding at the end of the period (in shares)	2,818,568
Weighted-average price per share	'
Outstanding at the beginning of the period (in dollars per share)	$5.52
Granted (in dollars per share)	$27.74
Exercised (in dollars per share)	$3.90
Cancelled (in dollars per share)	$12.81
Outstanding at the end of the period (in dollars per share)	$12.47
Additional disclosure	'
Total unrecognized compensation cost related to unvested restricted stock (in dollars)	$18.70
Weighted average period over which unrecognized compensation costs are expected to be recognized	'2 years 7 months 6 days

StockBased_Compensation_Detail3

Stock-Based Compensation (Details 4) (USD $)	3 Months Ended		9 Months Ended		42 Months Ended	6 Months Ended	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Jun. 30, 2013	Sep. 30, 2013
						2012 ESPP	2012 ESPP
Stock-Based Compensation	'	'	'	'	'	'	'
Common stock reserved for future issuance (in shares)	'	'	'	'	'	'	275,000
Shares issued	'	'	'	'	'	4,378	'
Stock-based compensation expense	$2,723,000	$440,000	$5,078,000	$1,006,000	$7,186,000	'	$47,000

Common_Stock_Transactions_Deta

Common Stock Transactions (Details) (USD $)	1 Months Ended	9 Months Ended		42 Months Ended
	Mar. 31, 2013	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Dec. 31, 2012
Common Stock Transactions	'	'	'	'	'
Shares sold	5,428,000	'	'	'	'
Common stock, par value (in dollars per share)	$0.00	$0.00	'	$0.00	$0.00
Common stock issue price, in an underwritten public offering (in dollars per share)	$18	'	'	'	'
Gross proceeds from the sale of common stock in an underwritten public offering	$97,700,000	'	'	'	'
Net proceeds from the sale of common stock in an underwritten public offering	$91,300,000	$91,312,000	$77,960,000	$169,272,000	'

Commitments_and_Contingencies_

Commitments and Contingencies (Details) (USD $)	9 Months Ended	1 Months Ended
In Millions, unless otherwise specified	Sep. 30, 2013	Jun. 30, 2013
		Minimum
Commitments and contingencies	'	'
Payments which company has agreed to make with respect to hosting of data management software and related services	'	$1.20
Expense recognized in association with the agreement	$0.30	'