Tesaro (TSRO) 10-Q 2 May 14 2014 Q1 Quarterly report Financial data

Document_and_Entity_Informatio

Document and Entity Information	3 Months Ended
	Mar. 31, 2014	Apr. 30, 2014
Document and Entity Information	'	'
Entity Registrant Name	'TESARO, Inc.	'
Entity Central Index Key	'0001491576	'
Document Type	'10-Q	'
Document Period End Date	31-Mar-14	'
Amendment Flag	'false	'
Current Fiscal Year End Date	'--12-31	'
Entity Current Reporting Status	'Yes	'
Entity Filer Category	'Accelerated Filer	'
Entity Common Stock, Shares Outstanding	'	35,995,685
Document Fiscal Year Focus	'2014	'
Document Fiscal Period Focus	'Q1	'

Condensed_Consolidated_Balance

Condensed Consolidated Balance Sheets (USD $)	Mar. 31, 2014	Dec. 31, 2013
In Thousands, unless otherwise specified
Current assets:	'	'
Cash and cash equivalents	$180,285	$130,310
Other current assets	3,317	4,029
Total current assets	183,602	134,339
Property and equipment, net	1,241	440
Other assets	1,311	799
Total assets	186,154	135,578
Current liabilities:	'	'
Accounts payable	2,416	1,869
Accrued expenses	13,130	10,541
Other current liabilities	'	13
Total current liabilities	15,546	12,423
Other non-current liabilities	'	3
Commitments and contingencies (Note 7)	'	'
Stockholders' equity:	'	'
Preferred stock, $0.0001 par value; 10,000,000 shares authorized at both December 31, 2013 and March 31, 2014; no shares issued or outstanding at both December 31, 2013 and March 31, 2014	'	'
Common stock, $0.0001 par value; 100,000,000 shares authorized at both December 31, 2013 and March 31, 2014; 32,739,008 and 35,981,019 shares issued and outstanding at December 31, 2013 and March 31, 2014, respectively	4	3
Additional paid-in capital	399,902	302,647
Deficit accumulated during the development stage	-229,298	-179,498
Total stockholders' equity	170,608	123,152
Total liabilities and stockholders' equity	$186,154	$135,578

Condensed_Consolidated_Balance1

Condensed Consolidated Balance Sheets (Parenthetical) (USD $)	Mar. 31, 2014	Dec. 31, 2013
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	35,981,019	32,739,008
Common stock, shares outstanding	35,981,019	32,739,008

Condensed_Consolidated_Stateme

Condensed Consolidated Statements of Operations and Comprehensive Loss (USD $)	3 Months Ended		48 Months Ended
In Thousands, except Per Share data, unless otherwise specified	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2014
Expenses:	'	'	'
Research and development	$28,117	$16,503	$162,856
General and administrative	4,688	2,400	31,009
Acquired in-process research and development	17,000	'	34,070
Total expenses	49,805	18,903	227,935
Loss from operations	-49,805	-18,903	-227,935
Interest income	5	34	298
Other income (expense), net	'	'	-1,661
Net loss	-49,800	-18,869	-229,298
Net loss per share applicable to common stockholders - basic and diluted (in dollars per share)	($1.43)	($0.66)	($16.86)
Weighted-average number of common shares used in net loss per share applicable to common stockholders - basic and diluted (in shares)	34,856	28,798	13,600
Comprehensive loss	($49,800)	($18,869)	($229,298)

Condensed_Consolidated_Stateme1

Condensed Consolidated Statements of Cash Flows (USD $)	3 Months Ended		48 Months Ended
In Thousands, unless otherwise specified	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2014
Operating activities	'	'	'
Net loss	($49,800)	($18,869)	($229,298)
Adjustments to reconcile net loss to net cash used in operating activities:	'	'	'
Acquired in-process research and development	17,000	'	34,070
Depreciation expense	63	37	348
Increase in fair value of investor rights obligation	'	'	1,661
Stock-based compensation expense	2,538	770	12,405
Loss on disposal of property and equipment	80	'	80
Changes in operating assets and liabilities:	'	'	'
Other assets	200	294	-4,628
Accounts payable	486	-1,065	2,355
Accrued expenses	2,310	956	12,851
Other liabilities	-16	23	'
Net cash used in operating activities	-27,139	-17,854	-170,156
Investing activities	'	'	'
Acquisition of product candidate and technology licenses and milestone payments	-17,000	'	-33,440
Purchase of property and equipment	-604	-308	-1,329
Net cash used in investing activities	-17,604	-308	-34,769
Financing activities	'	'	'
Proceeds from sale of common stock, net of issuance costs	94,199	91,312	263,471
Proceeds from exercise of stock options	519	49	1,186
Proceeds from issuance of common stock under Employee Stock Purchase Plan	'	'	147
Proceeds from sale of convertible preferred and common stock and related investor rights, net of issuance costs	'	'	120,406
Net cash provided by financing activities	94,718	91,361	385,210
Increase in cash and cash equivalents	49,975	73,199	180,285
Cash and cash equivalents at beginning of period	130,310	125,445	'
Cash and cash equivalents at end of period	180,285	198,644	180,285
Non-cash investing and financing activities	'	'	'
Issuance of Series O convertible preferred stock	'	'	630
Settlement of investor rights obligation	'	'	3,829
Purchase of property and equipment - cash not paid as of period end	340	'	340
Conversion of convertible preferred stock to common stock	'	'	$122,697

Description_of_Business

Description of Business	3 Months Ended
	Mar. 31, 2014
Description of Business	'
Description of Business	'
	1.  Description of Business
	TESARO, Inc., or 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.  TESARO acquires, in-licenses and develops oncology product candidates and, if approved for marketing, intends to commercialize these products globally.  Since incorporation, primary activities have consisted of acquiring product candidates, advancing development of these 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 currently operates in one segment.  The Company has never earned revenue from these activities, and, accordingly, the Company is considered to be in the development stage as of March 31, 2014.  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 private and public 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	3 Months Ended
	Mar. 31, 2014
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 conformity with accounting principles generally accepted in the United States of America, or 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 intercompany balances and transactions have been eliminated in consolidation.  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 has 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 March 31, 2013 and 2014.
	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, 2013 and the notes thereto, which are included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013.
	New Accounting Pronouncements - Recently Adopted
	In July 2013, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or 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 adopted this guidance effective January 1, 2014 and this adoption did not have a material effect on its condensed consolidated financial statements.
	New Accounting Pronouncements - Recently Issued
	In April 2014, the FASB issued ASU No. 2014-08, which amends guidance for reporting discontinued operations and disposals of components of an entity.  The amended guidance requires that a disposal representing a strategic shift that has (or will have) a major effect on an entity’s operations and financial results or a business activity classified as held for sale should be reported as discontinued operations.  The amendments also expand the disclosure requirements for discontinued operations and add new disclosures for individually significant dispositions that do not qualify as discontinued operations.  This guidance is effective prospectively for fiscal years beginning after December 15, 2014 (early adoption is permitted only for disposals that have not been previously reported).  The Company does not expect the adoption of this guidance to have a material effect on its consolidated financial statements.
	Use of Estimates
	The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets, liabilities, expenses, other comprehensive income and the related disclosures.  On an ongoing basis, management evaluates its estimates, including estimates related to accrued research and development expenses and stock-based compensation expense.  The Company bases its estimates on historical experience, known trends and other market-specific or other relevant factors 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 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, 2013 and March 31, 2014 and indicates the fair value hierarchy of the valuation inputs utilized to determine such fair value (in thousands):
			December 31, 2013
	Description	Balance Sheet Classification	Total		Level 1		Level 2		Level 3
	Assets:
	Money market funds	Cash and cash equivalents	$	128,801	$	128,801	$	—	$	—
	Total assets		$	128,801	$	128,801	$	—	$	—
			March 31, 2014
	Description	Balance Sheet Classification	Total		Level 1		Level 2		Level 3
	Assets:
	Money market funds	Cash and cash equivalents	$	179,460	$	179,460	$	—	$	—
	Total assets		$	179,460	$	179,460	$	—	$	—
	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 and milestone payments 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 active pharmaceutical ingredients, clinical trial materials and other research and development materials;
	·                  facilities, depreciation and other expenses, which include direct and allocated expenses for rent, utilities, maintenance of facilities, insurance and other supplies; and
	·                  costs associated with 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 its 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 condensed consolidated balance sheets 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.  Up-front payments that relate to the acquisition of 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 Expense
	Stock-based compensation is recognized as expense for all stock-based awards based on estimated fair values.  The Company determines the fair values of equity-based awards 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 are accounted for as an adjustment to expense in the period of the change.

Net_Loss_per_Share

Net Loss per Share	3 Months Ended
	Mar. 31, 2014
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 applicable to common stockholders 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 include convertible preferred stock (for 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 following table presents amounts that were 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 (in thousands):
				The Period from
				March 26, 2010
		Three Months Ended March 31,		(Inception) to
		2013	2014	March 31, 2014
	Outstanding stock options	2,783	3,364	3,364
	Unvested restricted stock	287	31	31
		3,070	3,395	3,395

StockBased_Compensation

Stock-Based Compensation	3 Months Ended
	Mar. 31, 2014
Stock-Based Compensation	'
Stock-Based Compensation	'
	4.  Stock-Based Compensation
	The Company maintains several equity compensation plans, including the 2012 Omnibus Incentive Plan, or the 2012 Incentive Plan, the 2010 Stock Incentive Plan, or the 2010 Incentive Plan, and the 2012 Employee Stock Purchase Plan, or 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 initially allowed 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.  Accordingly, effective January 1, 2014, the number of shares authorized for issuance under the 2012 Incentive Plan was increased by 1,309,560 shares.  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.
	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.  The exercise price of each stock option granted to date 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.
	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 March 31,					(Inception) to
		2013			2014		March 31, 2014
	Research and development	$	332		$	910	$	3,534
	General and administrative	438			1,628		8,871
	Total stock-based compensation expense	$	770		$	2,538	$	12,405
	The following table presents a summary of the Company’s restricted stock activity and related information:
				Weighted-average
				grant date fair
		Shares		value per share
	Unvested restricted stock at December 31, 2013	102,412		$	0.76
	Granted	—		—
	Vested	(62,011	)	0.1
	Forfeited	(8,929	)	0.53
	Unvested restricted stock at March 31, 2014	31,472		$	2.14
	The following table presents a summary of the Company’s stock option activity and related information:
		Shares		Weighted-average
				exercise price per
				share
	Outstanding at December 31, 2013	2,852,793		$	12.77
	Granted	737,898		33.11
	Exercised	(50,940	)	10.19
	Cancelled	(175,551	)	11.36
	Outstanding at March 31, 2014	3,364,200		$	17.35
	Vested at March 31, 2014	1,103,977		$	7.43
	Vested and expected to vest at March 31, 2014	3,364,200		$	17.35
	At March 31, 2014, there was approximately $30.6 million of total unrecognized compensation cost related to unvested stock options, which the Company expects to recognize over a remaining weighted-average period of 2.8 years.  At March 31, 2014, total unrecognized compensation cost related to unvested restricted stock was insignificant.
	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.  As of March 31, 2014, the Company had issued an aggregate of 7,831 shares under the 2012 ESPP.  As of March 31, 2014, the Company has recognized approximately $0.1 million in related stock-based compensation expense.
	During 2013, the Company’s former Executive Vice President, Chief Financial Officer, Treasurer and Secretary, or 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 continued to vest through March 31, 2014 (the end of the term of the Company’s consulting agreement with the former CFO).  As a result, beginning in September 2013 and ending March 31, 2014, the Company has accounted for unvested stock awards previously granted to the former CFO as non-employee awards.  The Company has recorded 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 months ended March 31, 2014, the Company recorded incremental stock-based compensation expense of $0.4 million associated with these awards.

Common_Stock_Transactions

Common Stock Transactions	3 Months Ended
	Mar. 31, 2014
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.
	In February 2014, the Company sold 3,200,000 shares of common stock, $0.0001 par value per share, in an underwritten public offering at a price to the public of $31.50 per share, resulting in gross proceeds of approximately $100.8 million.  Net proceeds to the Company after deducting fees, commissions and other expenses related to the offering were approximately $94.2 million.  The shares were issued pursuant to an automatic shelf registration statement on Form S-3.

Income_Taxes

Income Taxes	3 Months Ended
	Mar. 31, 2014
Income Taxes	'
Income Taxes	'
	6.  Income Taxes
	Deferred tax assets and deferred tax liabilities are determined based on temporary differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse.  A valuation allowance is recorded against deferred tax assets if it is more likely than not that some portion or all of the deferred tax assets will not be realized.
	For the three months ended March 31, 2013 and 2014, the Company did not record any current or deferred income tax provisions or benefits.  Due to the uncertainty surrounding the realization of the favorable tax attributes in future tax returns, the Company has recorded full valuation allowances against its otherwise recognizable net deferred tax assets at both December 31, 2013 and March 31, 2014

Commitments_and_Contingencies

Commitments and Contingencies	3 Months Ended
	Mar. 31, 2014
Commitments and Contingencies	'
Commitments and Contingencies	'
	7.  Commitments and Contingencies
	In January 2014, the Company entered into an amendment of its existing office lease agreement whereby beginning in March 2014 it expanded the total leased space in the facility to approximately 53,200 square feet and extended the term of the lease through June 30, 2017.  The amended lease provides for additional rent expense of approximately $0.9 million on an annualized basis.  In addition, the amended lease increased the security deposit to approximately $0.7 million and continues to require the Company to pay a proportionate share of certain of the landlord’s annual operating costs.  The Company recognizes rental expense on a straight-line basis over the respective lease term.
	Future minimum rental commitments under the amended lease as of March 31, 2014 were $1.3 million, $1.7 million, $1.7 million and $0.8 million for the remainder of the year ending December 31, 2014, and the years ending December 31, 2015, 2016 and 2017, respectively.
	The Company has entered into agreements with certain vendors for the provision of services, including services related to data management and clinical operation support services, that the Company is not contractually able to terminate for convenience and avoid any and all future obligations to the vendors.  Under such agreements, the Company is contractually obligated to make certain minimum payments to the vendors, with the exact amounts in the event of termination to be based on the timing of the termination and the exact terms of the agreement.
	The Company has certain obligations under licensing agreements with third parties that are contingent upon achieving various development, regulatory and commercial milestones.  Pursuant to these license agreements, the Company is required to make milestone payments if certain development, regulatory and commercial sales milestones are achieved, and may have certain additional research funding obligations.  Also, pursuant to the terms of each of these license agreements, when and if commercial sales of a product commence, the Company will pay royalties to its licensors on net sales of the respective products.
	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 does not have contingency reserves established for any litigation liabilities.

AnaptysBio_Collaboration_and_E

AnaptysBio Collaboration and Exclusive License Agreement	3 Months Ended
	Mar. 31, 2014
AnaptysBio Collaboration and Exclusive License Agreement	'
AnaptysBio Collaboration and Exclusive License Agreement	'
	8.  AnaptysBio Collaboration and Exclusive License Agreement
	Immuno-Oncology Platform License
	In March 2014, the Company entered into a collaboration and exclusive license agreement with AnaptysBio, Inc., or AnaptysBio, a privately-held therapeutic antibody company.  Under the terms of this agreement, the Company obtained an exclusive, royalty-bearing, sublicenseable worldwide license to research, develop, manufacture, market and sell products based on AnaptysBio’s proprietary technology for the discovery, generation and optimization of certain specified immunotherapy antibodies.  Specifically, the Company received exclusive rights to monospecific antibody product candidates targeting TIM-3, LAG-3 and PD-1 (TSR-042) and dual-reactive antibody product candidates targeting PD-1/TIM-3 and PD-1/LAG-3.  Under the agreement, AnaptysBio is responsible for performing initial discovery and development of therapeutic antibodies, with the goal of generating immunotherapy antibodies for use in the treatment of cancer.  The Company is responsible for the performance and costs of all subsequent preclinical, clinical, regulatory, manufacturing and other activities necessary to develop and commercialize antibodies selected under each of three development programs and is obligated to use commercially reasonable efforts to research, develop or commercialize at least one product under each development program.
	Under the terms of the agreement, the Company made an up-front, non-creditable and non-refundable cash payment of $17.0 million to AnaptysBio in March 2014.  The Company is also required to reimburse AnaptysBio, on a quarterly basis for up to two years from the effective date of the agreement, for specified costs incurred by AnaptysBio in its initial discovery and development activities covered by the agreement.  Programs may be extended by mutual agreement of the parties, and the Company can terminate on a program-by-program basis by providing 90 days’ prior written notice, subject to a wind-down period during which the Company’s obligation to reimburse AnaptysBio for specified costs would continue.  For each of the three development programs, the Company will be required to make milestone payments to AnaptysBio of up to $18.0 million if certain research and development milestone events are achieved, and up to an additional $90.0 million of milestone payments if certain U.S. and non-U.S. regulatory submissions and approvals occur in initial and subsequent indications.  The Company will be required to pay AnaptysBio tiered single-digit royalties, on a product-by-product basis, on the amount of worldwide annual net sales achieved, and additional commercial milestone payments if specified levels of annual net sales of a product are attained.
	As of the date of the license transaction, none of the assets acquired had alternative future uses, nor had they reached a stage of technological feasibility.  As the processes or activities that were acquired along with the license do not constitute a “business”, the transaction has been accounted for as an asset acquisition.  In addition, the Company has concluded that it is reimbursing AnaptysBio at fair value for the research services called for under the agreement.  As a result of these factors, the entire up-front payment of $17.0 million has been recorded as acquired in-process research and development expense, and no portion of the payment has been ascribed to the future services to be provided to the Company by AnaptysBio.  The Company has recorded approximately $0.2 million of research and development expense associated with amounts due to AnaptysBio under the collaboration through March 31, 2014.  As of March 31, 2014, the Company has not made any additional milestone payments under this agreement.

Basis_of_Presentation_and_Sign1

Basis of Presentation and Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2014
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 conformity with accounting principles generally accepted in the United States of America, or 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 intercompany balances and transactions have been eliminated in consolidation.  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 has 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 March 31, 2013 and 2014.
	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, 2013 and the notes thereto, which are included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013.
New Accounting Pronouncements - Recently Adopted	'
	New Accounting Pronouncements - Recently Adopted
	In July 2013, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or 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 adopted this guidance effective January 1, 2014 and this adoption did not have a material effect on its condensed consolidated financial statements.
New Accounting Pronouncements - Recently Issued	'
	New Accounting Pronouncements - Recently Issued
	In April 2014, the FASB issued ASU No. 2014-08, which amends guidance for reporting discontinued operations and disposals of components of an entity.  The amended guidance requires that a disposal representing a strategic shift that has (or will have) a major effect on an entity’s operations and financial results or a business activity classified as held for sale should be reported as discontinued operations.  The amendments also expand the disclosure requirements for discontinued operations and add new disclosures for individually significant dispositions that do not qualify as discontinued operations.  This guidance is effective prospectively for fiscal years beginning after December 15, 2014 (early adoption is permitted only for disposals that have not been previously reported).  The Company does not expect the adoption of this guidance to have a material effect on its consolidated financial statements.
Use of Estimates	'
	Use of Estimates
	The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets, liabilities, expenses, other comprehensive income and the related disclosures.  On an ongoing basis, management evaluates its estimates, including estimates related to accrued research and development expenses and stock-based compensation expense.  The Company bases its estimates on historical experience, known trends and other market-specific or other relevant factors 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 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, 2013 and March 31, 2014 and indicates the fair value hierarchy of the valuation inputs utilized to determine such fair value (in thousands):
			December 31, 2013
	Description	Balance Sheet Classification	Total		Level 1		Level 2		Level 3
	Assets:
	Money market funds	Cash and cash equivalents	$	128,801	$	128,801	$	—	$	—
	Total assets		$	128,801	$	128,801	$	—	$	—
			March 31, 2014
	Description	Balance Sheet Classification	Total		Level 1		Level 2		Level 3
	Assets:
	Money market funds	Cash and cash equivalents	$	179,460	$	179,460	$	—	$	—
	Total assets		$	179,460	$	179,460	$	—	$	—
	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 and milestone payments 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 active pharmaceutical ingredients, clinical trial materials and other research and development materials;
	·                  facilities, depreciation and other expenses, which include direct and allocated expenses for rent, utilities, maintenance of facilities, insurance and other supplies; and
	·                  costs associated with 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 its 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 condensed consolidated balance sheets 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.  Up-front payments that relate to the acquisition of 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 Expense	'
	Stock-Based Compensation Expense
	Stock-based compensation is recognized as expense for all stock-based awards based on estimated fair values.  The Company determines the fair values of equity-based awards 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 are accounted for as an adjustment to expense in the period of the change.

Basis_of_Presentation_and_Sign2

Basis of Presentation and Significant Accounting Policies (Tables)	3 Months Ended
	Mar. 31, 2014
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, 2013 and March 31, 2014 and indicates the fair value hierarchy of the valuation inputs utilized to determine such fair value (in thousands):
			December 31, 2013
	Description	Balance Sheet Classification	Total		Level 1		Level 2		Level 3
	Assets:
	Money market funds	Cash and cash equivalents	$	128,801	$	128,801	$	—	$	—
	Total assets		$	128,801	$	128,801	$	—	$	—
			March 31, 2014
	Description	Balance Sheet Classification	Total		Level 1		Level 2		Level 3
	Assets:
	Money market funds	Cash and cash equivalents	$	179,460	$	179,460	$	—	$	—
	Total assets		$	179,460	$	179,460	$	—	$	—

Net_Loss_per_Share_Tables

Net Loss per Share (Tables)	3 Months Ended
	Mar. 31, 2014
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 following table presents amounts that were 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 (in thousands):
				The Period from
				March 26, 2010
		Three Months Ended March 31,		(Inception) to
		2013	2014	March 31, 2014
	Outstanding stock options	2,783	3,364	3,364
	Unvested restricted stock	287	31	31
		3,070	3,395	3,395

StockBased_Compensation_Tables

Stock-Based Compensation (Tables)	3 Months Ended
	Mar. 31, 2014
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 March 31,					(Inception) to
		2013			2014		March 31, 2014
	Research and development	$	332		$	910	$	3,534
	General and administrative	438			1,628		8,871
	Total stock-based compensation expense	$	770		$	2,538	$	12,405
Summary of the Company's restricted stock activity and related information	'
				Weighted-average
				grant date fair
		Shares		value per share
	Unvested restricted stock at December 31, 2013	102,412		$	0.76
	Granted	—		—
	Vested	(62,011	)	0.1
	Forfeited	(8,929	)	0.53
	Unvested restricted stock at March 31, 2014	31,472		$	2.14
Summary of the Company's stock option activity and related information	'
		Shares		Weighted-average
				exercise price per
				share
	Outstanding at December 31, 2013	2,852,793		$	12.77
	Granted	737,898		33.11
	Exercised	(50,940	)	10.19
	Cancelled	(175,551	)	11.36
	Outstanding at March 31, 2014	3,364,200		$	17.35
	Vested at March 31, 2014	1,103,977		$	7.43
	Vested and expected to vest at March 31, 2014	3,364,200		$	17.35

Description_of_Business_Detail

Description of Business (Details)	3 Months Ended
	Mar. 31, 2014
	segment
Description of Business	'
Number of operating segments	1

Basis_of_Presentation_and_Sign3

Basis of Presentation and Significant Accounting Policies (Details) (USD $)	3 Months Ended
In Thousands, unless otherwise specified	Mar. 31, 2014	Mar. 31, 2014	Dec. 31, 2013	Mar. 31, 2014	Dec. 31, 2013	Mar. 31, 2014	Dec. 31, 2013	Mar. 31, 2014	Dec. 31, 2013
	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 and cash equivalents	'	'	'	$179,460	$128,801	'	'	$179,460	$128,801
Assets	'	$179,460	$128,801	'	'	$179,460	$128,801	'	'
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)	3 Months Ended		48 Months Ended
In Thousands, unless otherwise specified	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2014
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	3,395	3,070	3,395
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	3,364	2,783	3,364
Unvested 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	31	287	31

StockBased_Compensation_Detail

Stock-Based Compensation (Details) (Common stock)	0 Months Ended	3 Months Ended
	Jan. 02, 2014	Mar. 31, 2014	Apr. 27, 2012
2012 Incentive Plan	'	'	'
Stock-Based Compensation	'	'	'
Number of shares available for grant under the plan	'	'	1,428,571
Number of shares available for future grants that were added to the total number of shares reserved for issuance	'	'	6,857
Number of additional shares authorized underthe plan	1,309,560	'	'
Annual increase in common stock available for grant as a percentage of common stock outstanding	'	4.00%	'
2010 Incentive Plan	'	'	'
Stock-Based Compensation	'	'	'
Number of shares available for grant under the plan	'	1,981,130	'

StockBased_Compensation_Detail1

Stock-Based Compensation (Details 2) (USD $)	3 Months Ended		48 Months Ended
In Thousands, unless otherwise specified	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2014
Stock-based compensation expense	'	'	'
Total stock-based compensation expense	$2,538	$770	$12,405
Research and development	'	'	'
Stock-based compensation expense	'	'	'
Total stock-based compensation expense	910	332	3,534
General and administrative	'	'	'
Stock-based compensation expense	'	'	'
Total stock-based compensation expense	$1,628	$438	$8,871

StockBased_Compensation_Detail2

Stock-Based Compensation (Details 3) (USD $)	3 Months Ended
In Millions, except Share data, unless otherwise specified	Mar. 31, 2014
Restricted stock awards	'
Shares	'
Unvested restricted at the beginning of the period (in shares)	102,412
Vested (in shares)	-62,011
Forfeited (in shares)	-8,929
Unvested restricted at the end of the period (in shares)	31,472
Weighted-average grant date fair value per share	'
Unvested restricted at the beginning of the period (in dollars per share)	$0.76
Vested (in dollars per share)	$0.10
Forfeited (in dollars per share)	$0.53
Unvested restricted at the end of the period (in dollars per share)	$2.14
Stock options	'
Shares	'
Outstanding at the beginning of the period (in shares)	2,852,793
Granted (in shares)	737,898
Exercised (in shares)	-50,940
Cancelled (in shares)	-175,551
Outstanding at the end of the period (in shares)	3,364,200
Vested at the end of the period (in shares)	1,103,977
Vested and expected to vest at the end of the period (in shares)	3,364,200
Weighted-average price per share	'
Outstanding at the beginning of the period (in dollars per share)	$12.77
Granted (in dollars per share)	$33.11
Exercised (in dollars per share)	$10.19
Cancelled (in dollars per share)	$11.36
Outstanding at the end of the period (in dollars per share)	$17.35
Vested at the end of the period (in dollars per share)	$7.43
Vested and expected to vest at the end of the period (in dollars per share)	$17.35
Additional disclosure	'
Total unrecognized compensation cost related to unvested stock options (in dollars)	$30.60
Weighted average period over which unrecognized compensation costs are expected to be recognized	'2 years 9 months 18 days

StockBased_Compensation_Detail3

Stock-Based Compensation (Details 4) (USD $)	3 Months Ended		48 Months Ended	3 Months Ended	48 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2014	Mar. 31, 2014	Mar. 31, 2014
				Former CFO	2012 ESPP
Stock-Based Compensation	'	'	'	'	'
Common stock reserved for future issuance (in shares)	'	'	'	'	275,000
Shares issued	'	'	'	'	7,831
Stock-based compensation expense	$2,538,000	$770,000	$12,405,000	'	$100,000
Stock-based compensation expense	'	'	'	'	'
Incremental stock-based compensation expense	'	'	'	$400,000	'

Common_Stock_Transactions_Deta

Common Stock Transactions (Details) (USD $)	1 Months Ended		3 Months Ended		48 Months Ended
	Feb. 28, 2014	Mar. 31, 2013	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2014	Dec. 31, 2013
Common Stock Transactions	'	'	'	'	'	'
Shares sold	3,200,000	5,428,000	'	'	'	'
Common stock, par value (in dollars per share)	$0.00	$0.00	$0.00	$0.00	$0.00	$0.00
Common stock issue price, in an underwritten public offering (in dollars per share)	$31.50	$18	'	'	'	'
Gross proceeds from the sale of common stock in an underwritten public offering	$100,800,000	$97,700,000	'	'	'	'
Net proceeds from the sale of common stock in an underwritten public offering	$94,200,000	$91,300,000	$94,199,000	$91,312,000	$263,471,000	'

Commitments_and_Contingencies_

Commitments and Contingencies (Details) (Amendment of operating lease, USD $)	1 Months Ended
In Millions, unless otherwise specified	Jan. 31, 2014	Mar. 31, 2014
	sqft
Amendment of operating lease	'	'
Commitments and Contingencies	'	'
Leased office space (in square feet)	53,200	'
Additional rent expense	$0.90	'
Security deposit under amended lease	0.7	'
Future minimum rental commitments	'	'
Remainder of 2014	'	1.3
2015	'	1.7
2016	'	1.7
2017	'	$0.80

AnaptysBio_Collaboration_and_E1

AnaptysBio Collaboration and Exclusive License Agreement (Details) (USD $)	3 Months Ended		48 Months Ended	1 Months Ended	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2014	Mar. 31, 2014	Mar. 31, 2014	Mar. 31, 2014
				Collaboration and exclusive license agreement	Collaboration and exclusive license agreement	Collaboration and exclusive license agreement
				AnaptysBio	AnaptysBio	Maximum
					item	AnaptysBio
AnaptysBio Collaboration and Exclusive License Agreement	'	'	'	'	'	'
Number of development programs	'	'	'	'	3	'
Period for reimbursement of specified cost under agreement	'	'	'	'	'	'2 years
Termination period	'	'	'	'	'	'90 days
Milestone payments required, if certain research and development milestone events are achieved	'	'	'	'	'	$18,000,000
Additional milestone payments required, if certain U.S. and non-U.S. regulatory submissions and approvals occur in multiple indications	'	'	'	'	'	90,000,000
Up-front payment recorded as acquired in-process research and development expense	17,000,000	'	33,440,000	17,000,000	17,000,000	'
Research and development expense	$28,117,000	$16,503,000	$162,856,000	'	$200,000	'