Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Oct. 27, 2017 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | HZNP | |
Entity Registrant Name | HORIZON PHARMA PLC | |
Entity Central Index Key | 1,492,426 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 163,885,803 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 624,960 | $ 509,055 |
Restricted cash | 6,530 | 7,095 |
Accounts receivable, net | 390,683 | 305,725 |
Inventories, net | 86,527 | 174,788 |
Prepaid expenses and other current assets | 52,925 | 49,619 |
Total current assets | 1,161,625 | 1,046,282 |
Property and equipment, net | 21,700 | 23,484 |
Intangible assets, net | 2,518,055 | 2,773,435 |
Goodwill | 426,441 | 445,579 |
Deferred tax assets, net | 5,399 | 911 |
Other assets | 36,234 | 2,368 |
Total assets | 4,169,454 | 4,292,059 |
CURRENT LIABILITIES: | ||
Long-term debt—current portion | 8,500 | 7,750 |
Accounts payable | 32,825 | 52,479 |
Accrued expenses | 162,701 | 182,765 |
Accrued trade discounts and rebates | 435,714 | 297,556 |
Accrued royalties—current portion | 62,273 | 61,981 |
Deferred revenues—current portion | 5,938 | 3,321 |
Total current liabilities | 707,951 | 605,852 |
LONG-TERM LIABILITIES: | ||
Exchangeable notes, net | 310,130 | 298,002 |
Long-term debt, net, net of current | 1,578,947 | 1,501,741 |
Accrued royalties, net of current | 268,672 | 272,293 |
Deferred revenues, net of current | 9,842 | 7,763 |
Deferred tax liabilities, net | 226,113 | 296,568 |
Other long-term liabilities | 67,976 | 46,061 |
Total long-term liabilities | 2,461,680 | 2,422,428 |
COMMITMENTS AND CONTINGENCIES | ||
SHAREHOLDERS’ EQUITY: | ||
Ordinary shares, $0.0001 nominal value; 300,000,000 shares authorized; 164,242,005 and 162,004,956 shares issued at September 30, 2017 and December 31, 2016, respectively, and 163,857,639 and 161,620,590 shares outstanding at September 30, 2017 and December 31, 2016, respectively | 16 | 16 |
Treasury stock, 384,366 ordinary shares at September 30, 2017 and December 31, 2016 | (4,585) | (4,585) |
Additional paid-in capital | 2,212,613 | 2,119,455 |
Accumulated other comprehensive loss | (2,341) | (3,086) |
Accumulated deficit | (1,205,880) | (848,021) |
Total shareholders’ equity | 999,823 | 1,263,779 |
Total liabilities and shareholders' equity | 4,169,454 | 4,292,059 |
Developed Technology [Member] | ||
CURRENT ASSETS: | ||
Intangible assets, net | 2,512,412 | 2,767,184 |
Customer Relationships [Member] | ||
CURRENT ASSETS: | ||
Intangible assets, net | $ 5,643 | $ 6,251 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Sep. 30, 2017 | Dec. 31, 2016 |
Statement Of Financial Position [Abstract] | ||
Ordinary shares, nominal value | $ 0.0001 | $ 0.0001 |
Ordinary shares, shares authorized | 300,000,000 | 300,000,000 |
Ordinary shares, shares issued | 164,242,005 | 162,004,956 |
Ordinary shares, shares outstanding | 163,857,639 | 161,620,590 |
Treasury stock, ordinary shares | 384,366 | 384,366 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Statement [Abstract] | ||||
Net sales | $ 271,646 | $ 208,702 | $ 782,012 | $ 670,770 |
Cost of goods sold | 125,517 | 85,161 | 394,783 | 243,520 |
Gross profit | 146,129 | 123,541 | 387,229 | 427,250 |
OPERATING EXPENSES: | ||||
Research and development | 17,928 | 12,814 | 194,090 | 36,746 |
Selling, general and administrative | 153,952 | 132,049 | 509,940 | 407,563 |
Total operating expenses | 171,880 | 144,863 | 704,030 | 444,309 |
Operating loss | (25,751) | (21,322) | (316,801) | (17,059) |
OTHER EXPENSE, NET: | ||||
Interest expense, net | (31,706) | (19,066) | (95,297) | (57,752) |
Foreign exchange gain (loss) | 275 | (108) | 167 | (266) |
Gain on divestiture | 112 | 5,968 | ||
Loss on debt extinguishment | (533) | |||
Other income, net | 280 | 6,879 | 280 | 6,839 |
Total other expense, net | (31,039) | (12,295) | (89,415) | (51,179) |
Loss before expense (benefit) for income taxes | (56,790) | (33,617) | (406,216) | (68,238) |
Expense (benefit) for income taxes | 7,181 | (27,747) | (42,138) | (31,946) |
Net loss | $ (63,971) | $ (5,870) | $ (364,078) | $ (36,292) |
Net loss per ordinary share—basic and diluted | $ (0.39) | $ (0.04) | $ (2.24) | $ (0.23) |
Weighted average shares outstanding—basic and diluted | 163,447,208 | 161,038,827 | 162,810,551 | 160,472,530 |
OTHER COMPREHENSIVE (LOSS) INCOME, NET OF TAX | ||||
Foreign currency translation adjustments | $ (209) | $ (110) | $ 745 | $ (196) |
Other comprehensive (loss) income | (209) | (110) | 745 | (196) |
Comprehensive loss | $ (64,180) | $ (5,980) | $ (363,333) | $ (36,488) |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (364,078) | $ (36,292) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization expense | 213,155 | 154,465 |
Equity-settled share-based compensation | 91,391 | 84,011 |
Royalty accretion | 38,415 | 28,762 |
Royalty liability remeasurement | (2,944) | |
Acquired in-process research and development expense | 148,769 | |
Impairment of non-current asset | 22,270 | |
Loss on debt extinguishment | 388 | |
Payments related to term loan refinancing | (3,940) | |
Amortization of debt discount and deferred financing costs | 15,863 | 13,469 |
Gain on divestiture | (2,635) | |
Deferred income taxes | (62,989) | (35,158) |
Foreign exchange and other adjustments | (1,521) | 268 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (85,161) | (142,448) |
Inventories | 83,482 | 23,842 |
Prepaid expenses and other current assets | (4,435) | (20,838) |
Accounts payable | (18,414) | 49,695 |
Deferred revenues | 3,770 | (443) |
Other non-current assets and liabilities | (14,559) | (1,653) |
Net cash provided by operating activities | 136,995 | 230,271 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Payments for acquisitions, net of cash acquired | (168,818) | (520,405) |
Proceeds from divestiture, net of cash divested | 69,072 | |
Change in restricted cash | 568 | (3,411) |
Purchases of property and equipment | (4,031) | (14,616) |
Net cash used in investing activities | (103,209) | (538,432) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Net proceeds from term loans | 847,768 | |
Repayment of term loans | (770,790) | (3,000) |
Proceeds from the issuance of ordinary shares in connection with warrant exercises | 1,789 | |
Proceeds from the issuance of ordinary shares through an employee stock purchase plan | 3,856 | 3,235 |
Proceeds from the issuance of ordinary shares in connection with stock option exercises | 1,762 | 3,384 |
Payment of employee withholding taxes related to share-based awards | (5,640) | (5,309) |
Repurchase of ordinary shares | (992) | |
Net cash provided by (used in) financing activities | 77,753 | (1,690) |
Effect of foreign exchange rate changes on cash and cash equivalents | 4,366 | (462) |
Net increase (decrease) in cash and cash equivalents | 115,905 | (310,313) |
Cash and cash equivalents, beginning of the period | 509,055 | 859,616 |
Cash and cash equivalents, end of the period | 624,960 | 549,303 |
SUPPLEMENTAL CASH FLOW INFORMATION: | ||
Cash paid for interest | 74,378 | 39,542 |
Net cash payments for income taxes | 2,054 | 18,538 |
Cash paid for debt extinguishment | 145 | |
SUPPLEMENTAL NON-CASH FLOW INFORMATION: | ||
Purchases of property and equipment included in accounts payable and accrued expenses | 45 | 1,101 |
Accrued Trade Discounts and Rebates [Member] | ||
Changes in operating assets and liabilities: | ||
Accrued liabilities | 139,461 | 83,009 |
Accrued Expenses and Accrued Royalties [Member] | ||
Changes in operating assets and liabilities: | ||
Accrued liabilities | $ (59,293) | $ 29,582 |
Basis of Presentation and Busin
Basis of Presentation and Business Overview | 9 Months Ended |
Sep. 30, 2017 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Basis of Presentation and Business Overview | NOTE 1 – BASIS OF PRESENTATION AND BUSINESS OVERVIEW Basis of Presentation The unaudited condensed consolidated financial statements presented herein have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the financial statements do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments, including normal recurring adjustments, considered necessary for a fair statement of the financial statements have been included. Operating results for the three and nine months ended September 30, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017. The December 31, 2016 condensed consolidated balance sheet was derived from audited financial statements, but does not include all disclosures required by GAAP. Unless otherwise indicated or the context otherwise requires, references to the “Company”, “we”, “us” and “our” refer to Horizon Pharma plc and its consolidated subsidiaries. The unaudited condensed consolidated financial statements presented herein include the accounts of the Company and its wholly owned subsidiaries. All inter-company transactions and balances have been eliminated. On January 13, 2016 completed its acquisition of On October 25, 2016, the Company completed its acquisition of Raptor Pharmaceutical Corp. (“Raptor”) in which the Company acquired all of the issued and outstanding shares of Raptor’s common stock for $9.00 per share in cash. The total consideration was $860.8 million, including $24.9 million of cash acquired and $56.0 million paid to settle Raptor’s outstanding debt. Following completion of the acquisition, Raptor became a wholly owned subsidiary of the Company and converted to a limited liability company, changing its name to Horizon Pharmaceutical LLC. On May 8, 2017, the Company acquired River Vision Development Corp. (“River Vision”) for upfront cash payments totaling $151.9 million, including $6.3 million of cash acquired, and subject to other customary purchase price adjustments for working capital, and potential future milestone and royalty payments contingent on the satisfaction of certain regulatory milestones and sales thresholds. Following completion of the acquisition, River Vision became a wholly owned subsidiary of the Company and was renamed as Horizon Pharma Tepro, Inc. On June 23, 2017, the Company sold its European subsidiary that owned the marketing rights to PROCYSBI ® On June 30, 2017, the Company completed its acquisition of certain rights to interferon gamma-1b from Boehringer Ingelheim International GmbH (“Boehringer Ingelheim International”) in all territories outside of the United States, Canada and Japan, as the Company previously held marketing rights to interferon gamma-1b in these territories. Boehringer Ingelheim International commercialized interferon gamma-1b under the trade names IMUKIN ® ® ® ® ® The unaudited condensed consolidated financial statements presented herein include the results of operations of the acquired Crealta and Raptor businesses from the applicable dates of acquisition. See Note 3 for further details of acquisitions and divestitures. Beginning in the first quarter of 2017, the Company modified its presentation of certain operating expenses. Previously, the Company presented “general and administrative” expenses as one line item in its condensed consolidated statement of comprehensive loss, and “selling and marketing” expenses as another. For current-period presentation and prior-period comparisons, the Company now combines these two line items into one line item, titled “selling, general and administrative” expenses. Business Overview The Company is a biopharmaceutical company focused on improving patients’ lives by identifying, developing, acquiring and commercializing differentiated and accessible medicines that address unmet medical needs. The Company markets eleven medicines through its orphan, rheumatology and primary care business units. The Company’s marketed medicines are: Orphan Business Unit ACTIMMUNE® (interferon gamma-1b); marketed as IMUKIN® outside the United States BUPHENYL® (sodium phenylbutyrate) Tablets and Powder; marketed as AMMONAPS® in certain European countries and Japan PROCYSBI® (cysteamine bitartrate) delayed-release capsules QUINSAIR™ (levofloxacin inhalation solution) RAVICTI® (glycerol phenylbutyrate) Oral Liquid Rheumatology Business Unit KRYSTEXXA® (pegloticase) RAYOS® (prednisone) delayed-release tablets; marketed as LODOTRA® outside the United States Primary Care Business Unit DUEXIS® (ibuprofen/famotidine) MIGERGOT® (ergotamine tartrate & caffeine suppositories) PENNSAID® (diclofenac sodium topical solution) 2% w/w (“PENNSAID 2%”) VIMOVO® (naproxen/esomeprazole magnesium) Recent Accounting Pronouncements From time to time, the Company adopts new accounting pronouncements issued by the Financial Accounting Standards Board (“FASB”) or other standard-setting bodies. Effective January 1, 2017, the Company elected to early adopt ASU No. Business Combinations (Topic 805): Clarifying the Definition of a Business ASU No. The adoption did not have a material impact on the Company’s condensed consolidated financial statements and related disclosures. Effective January 1, 2017, the Company adopted ASU No. 2016-09, Improvements to Employee Share-Based Payment Accounting In May 2017, the FASB issued ASU No. 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting In February 2017, the FASB issued ASU No. 2017-05, (“ Subtopic 610-20 , Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets The Company does not expect the adoption of ASU No. 2017-05 to have a material impact condensed In January 2017, the FASB issued ASU No. 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment on the Company’s consolidated financial statements and related disclosures. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash The Company does not expect the adoption of to have a material impact on the Company’s condensed consolidated financial statements and related disclosures In October 2016, the FASB issued ASU No. Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) In May 2014, the FASB issued ASU Revenue from Contracts with Customers Revenue From Contracts with Customers (Topic 606): Principal Versus Agent Considerations Revenue From Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing, , Technical Corrections and Improvements to Topic 606, Revenue From Contracts with Customers Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840) and Leases (Topic 842), Other recent authoritative guidance issued by the FASB (including technical corrections to the Accounting Standards Codification), the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not, or are not expected to, have a material impact on the Company’s condensed consolidated financial statements and related disclosures. |
Net Loss per Share
Net Loss per Share | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Net Loss per Share | NOTE 2 – NET LOSS PER SHARE The following table presents basic and diluted net loss per share for the three and nine months ended September 30, 2017 and 2016 (in thousands, except share and per share data): For the Three Months Ended September 30, For the Nine Months Ended September 30, 2017 2016 2017 2016 Basic and diluted net loss per share calculation: Net loss $ (63,971 ) $ (5,870 ) $ (364,078 ) $ (36,292 ) Weighted average ordinary shares outstanding 163,447,208 161,038,827 162,810,551 160,472,530 Basic and diluted net loss per share $ (0.39 ) $ (0.04 ) $ (2.24 ) $ (0.23 ) Basic net loss per share is computed by dividing net loss by the weighted-average number of ordinary shares outstanding during the period. Diluted net loss per share reflects the potential dilution beyond shares for basic net loss per share that could occur if securities or other contracts to issue ordinary shares were exercised, converted into ordinary shares, or resulted in the issuance of ordinary shares that would have shared in the Company’s earnings. The computation of diluted net loss per share excluded 18.7 million and 18.2 million shares subject to equity awards and warrants for the three and nine months ended September 30, 2017, respectively, and 11.6 million and 14.2 million shares subject to equity awards for the three and nine months ended September 30, 2016, respectively, because their inclusion would have had an anti-dilutive effect on diluted net loss per share. The potentially dilutive impact of the March 2015 private placement of $400.0 million aggregate principal amount of 2.50% Exchangeable Senior Notes due 2022 (the “Exchangeable Senior Notes”) by Horizon Pharma Investment Limited (“Horizon Investment”), a wholly owned subsidiary of the Company, is determined using a method similar to the treasury stock method. Under this method, no numerator or denominator adjustments arise from the principal and interest components of the Exchangeable Senior Notes because the Company has the intent and ability to settle the Exchangeable Senior Notes’ principal and interest in cash. Instead, the Company is required to increase the diluted net (loss) income per share denominator by the variable number of shares that would be issued upon conversion if it settled the conversion spread obligation with shares. For diluted net (loss) income per share purposes, the conversion spread obligation is calculated based on whether the average market price of the Company’s ordinary shares over the reporting period is in excess of the exchange price of the Exchangeable Senior Notes. There was no calculated spread added to the denominator for the three and nine months ended September 30, 2017 and 2016. |
Divestitures, Acquisitions and
Divestitures, Acquisitions and Other Arrangements | 9 Months Ended |
Sep. 30, 2017 | |
Business Combinations [Abstract] | |
Divestitures, Acquisitions and Other Arrangements | NOTE 3 –DIVESTITURES, ACQUISITIONS AND OTHER ARRANGEMENTS Divestiture of PROCYSBI and QUINSAIR rights in EMEA Regions On June 23, 2017, the Company completed the Chiesi divestiture for an upfront payment of $72.2 million, which reflects $3.1 million of cash divested, and subject to other customary purchase price adjustments for working capital, with additional potential milestone payments based on sales thresholds. Pursuant to ASU No. 2017-01, the Company accounted for the Chiesi divestiture as a sale of a business. The Company determined that the sale of the business and its assets in connection with the Chiesi divestiture did not constitute a strategic shift and that it did not and will not have a major effect on its operations and financial results. Accordingly, the operations associated with the Chiesi divestiture are not reported in discontinued operations. The gain on divestiture was determined as follows (in thousands): For the Three Months Ended For the Nine Months Ended September 30, 2017 September 30, 2017 Cash proceeds $ — $ 72,163 Add reimbursement of royalties — 27,101 Less net assets sold: Developed technology — (47,261 ) Goodwill — (16,285 ) Other — (24,482 ) Transaction and other costs 112 (5,268 ) Gain on divestiture $ 112 $ 5,968 Under the terms of its agreement with Chiesi, the Company will continue to pay third parties for the royalties on sales of PROCYSBI and QUINSAIR in EMEA, and Chiesi will reimburse the Company for those royalties. At the date of divestiture, the Company recorded an asset of $27.1 million to “other assets”, which represented the estimated amounts that are expected to be reimbursed from Chiesi for the PROCYSBI and QUINSAIR royalties. These estimated royalties are accrued in “accrued expenses” and “other long-term liabilities”. Transaction and other costs primarily relate to professional and license fees attributable to the divestiture. Acquisitions Acquisition of River Vision On May 8, 2017, the Company acquired 100% of the equity interests in River Vision for upfront cash payments totaling $151.9 million, including $6.3 million of cash acquired, and subject to other customary purchase price adjustments for working capital, potential future milestone and royalty payments contingent on the satisfaction of certain regulatory milestones and sales thresholds. Pursuant to ASC 805 (as amended by ASU No. 2017-01), the Company accounted for the River Vision acquisition as the purchase of an in-process research and development (“IPR&D”) asset and, pursuant to ASC 730, recorded the purchase price as research and development expense during the nine months ended September 30, 2017. Further, the Company recognized approximately $13.1 million of federal net operating losses, $2.8 million of state net operating losses and $5.8 million of federal tax credits. The acquired tax attributes were set up as deferred tax assets which were further netted within the net deferred tax liabilities of the U.S. group, offset by a deferred credit recorded in long-term liabilities. Acquisition of Additional Rights to Interferon Gamma-1b On June 30, 2017, the Company completed its acquisition of certain rights to interferon gamma-1b from Boehringer Ingelheim International in all territories outside of the United States, Canada and Japan, as the Company previously held marketing rights to interferon gamma-1b in these territories. Boehringer Ingelheim International commercialized interferon gamma-1b as IMUKIN in an estimated thirty countries, primarily in Europe and the Middle East. In May 2016, the Company paid Boehringer Ingelheim International €5.0 million ($5.6 million when converted using a Euro-to-Dollar exchange rate at date of payment of 1.1132) for such rights and upon closing in June 2017, the Company paid Boehringer Ingelheim International an additional €19.5 million ($22.3 million when converted using a Euro-to-Dollar exchange rate at date of payment of 1.1406). The Company currently markets interferon gamma-1b as ACTIMMUNE in the United States. The €5.0 million upfront amount paid in May 2016 had initially been included in “other assets” in the Company’s condensed consolidated balance sheet. Following the discontinuation of the development of ACTIMMUNE in Friedreich’s ataxia (“FA”) in December 2016, the Company recorded an impairment charge of €5.0 million ($5.3 million when converted using a Euro-to-Dollar exchange rate at date of impairment of 1.052) to fully write off the asset in its condensed consolidated statements of comprehensive loss during the year ended December 31, 2016 as projections for future net sales of IMUKIN in these territories did not exceed the related costs. Upon closing, during the nine months ended September 30, 2017, the Company recorded the additional €19.5 million payment ($22.3 million when converted using a Euro-to-Dollar exchange rate at date of payment of 1.1406) as a “selling, general and administrative” expense in its condensed consolidated statement of comprehensive loss. Raptor Acquisition On October 25, 2016, the Company completed its acquisition of Raptor in which the Company acquired all of the issued and outstanding shares of Raptor’s common stock for $9.00 per share. The acquisition added two medicines, PROCYSBI and QUINSAIR, to the Company’s medicine portfolio. Through the acquisition, the Company leveraged and expanded the infrastructure of its orphan disease business. Cash $ 841,494 Net settlements on the exercise of stock options and restricted stock units 19,268 Total consideration $ 860,762 During the three and nine months ended September 30, 2017, the Company incurred $3.1 million and $14.6 million, respectively, in Raptor acquisition-related costs including advisory, legal, accounting, severance, retention bonuses and other professional and consulting fees. During the three and nine months ended September 30, 2017, $3.0 million and $13.8 million, respectively, were accounted for as “selling, general and administrative” expenses, $0.1 million and $0.7 million, respectively, were accounted for as “research and development” expenses, and zero and $0.1 million, were accounted for as “cost of goods sold”, respectively, in the condensed consolidated statements of comprehensive loss. During the three and nine months ended September 30, 2016, the Company incurred $4.2 million in Raptor acquisition-related costs including advisory, legal and other professional and consulting costs which were accounted for as “selling, general and administrative” expenses in the condensed consolidated statements of comprehensive loss. Pursuant to ASC 805, the Company accounted for the Raptor acquisition as a business combination using the acquisition method of accounting. Identifiable assets and liabilities of Raptor, including identifiable intangible assets, were recorded based on their estimated fair values as of the date of the closing of the acquisition. The excess of the purchase price over the fair value of the net assets acquired was recorded as goodwill. Significant judgment was required in determining the estimated fair values of developed technology intangible assets, inventories and certain other assets and liabilities. Such preliminary valuation required estimates and assumptions including, but not limited to, estimating future cash flows and direct costs in addition to developing the appropriate discount rates and current market profit margins. The Company’s management believes the fair values recognized for the assets acquired and the liabilities assumed are based on reasonable estimates and assumptions. The Company is currently completing its evaluation of information, assumptions and valuation methodologies it used in its preliminary fair value of the purchase price consideration. The purchase price allocation is preliminary pending final determination of the fair values of certain assets and liabilities. During the nine months ended September 30, 2017, the Company recorded measurement period adjustments related to accrued expenses, accrued trade discounts and rebates and deferred tax liabilities as a result of new information regarding facts existing at the acquisition date, which resulted in a net decrease to goodwill of $2.9 million. As of September 30, 2017, certain items related to current and deferred taxes have not been finalized and may be subject to change as additional information is received. The finalization of these matters and any additional information received that existed as of the acquisition date may result in changes to the underlying assets, liabilities and goodwill. These changes may be material. The final determination of these fair values will be completed no later than during the fourth quarter of 2017. The following table summarizes the preliminary fair values assigned to the assets acquired and the liabilities assumed by the Company, along with the resulting goodwill before and after the measurement period adjustment (in thousands): (Liabilities assumed) and assets acquired: Before Adjustment After Accounts payable $ (4,572 ) $ — $ (4,572 ) Accrued expenses (23,773 ) (240 ) (24,013 ) Accrued trade discounts and rebates (6,377 ) 1,350 (5,027 ) Deferred tax liabilities (237,166 ) 1,743 (235,423 ) Contingent royalty liability (102,000 ) — (102,000 ) Accrued royalties (2,705 ) — (2,705 ) Other non-current liability (25,500 ) — (25,500 ) Cash and cash equivalents 24,897 — 24,897 Restricted cash 1,350 — 1,350 Accounts receivable, net 17,767 — 17,767 Inventories 74,463 — 74,463 Prepaid expenses and other current assets 4,194 — 4,194 Property and equipment 3,373 — 3,373 Developed technology 946,000 — 946,000 Other non-current assets 1,765 — 1,765 Goodwill 189,046 (2,853 ) 186,193 Fair value of consideration paid $ 860,762 $ — $ 860,762 Inventories acquired included raw materials, work-in-process and finished goods for PROCYSBI and QUINSAIR. Inventories were recorded at their preliminary estimated fair values. The fair value of finished goods has been determined based on the estimated selling price, net of selling costs and a margin on the selling costs. The fair value of work-in-process has been determined based on estimated selling price, net of selling costs and costs to complete the manufacturing, and a margin on the selling and manufacturing costs. The fair value of raw materials was estimated to equal the replacement cost. A step-up in the value of inventory of $67.0 million was recorded in connection with the acquisition. During the three and nine months ended September 30, 2017, the Company recorded inventory step-up expense of zero and $44.0 million, respectively, related to PROCYSBI and QUINSAIR, of which $3.2 million was recorded to “gain on divestiture” in the condensed consolidated statement of comprehensive loss during the nine months ended September 30, 2017. Other tangible assets and liabilities were valued at their respective carrying amounts as management believes that these amounts approximated their acquisition date fair values. Other non-current liability of $25.5 million represents the fair value of an assumed contingent liability, arising from contingent payments associated with development, regulatory and commercial milestones following Raptor’s acquisition of QUINSAIR. Identifiable intangible assets and liabilities acquired include developed technology and contingent royalties. The preliminary estimated fair values of the developed technology and contingent royalties represent preliminary valuations performed with the assistance of an independent appraisal firm based on management’s estimates, forecasted financial information and reasonable and supportable assumptions. Developed technology intangible assets reflect the estimated fair value of Raptor’s rights to PROCYSBI. The preliminary fair value of developed technology was determined using an income approach. The income approach explicitly recognizes that the fair value of an asset is premised upon the expected receipt of future economic benefits such as earnings and cash inflows based on current sales projections and estimated direct costs for Raptor’s medicines. Indications of value were developed by discounting these benefits to their acquisition-date worth at a discount rate of 12.5%. The fair value of the PROCYSBI developed technology was capitalized as of the Raptor acquisition date and is subsequently being amortized over approximately thirteen years and nine years for the U.S. rights and ex-U.S. rights, respectively, which are the periods in which over 90% of the estimated cash flows are expected to be realized. The Company assigned no preliminary fair value to QUINSAIR developed technology as projections of future net sales do not exceed the related costs. See Note 7 for details of developed technology sold in the Chiesi divestiture. The Company has assigned a preliminary fair value of $102.0 million to a contingent liability for royalties potentially payable under previously existing agreements related to PROCYSBI. The royalties for PROCYSBI are payable under the terms of an amended and restated license agreement with The Regents of the University of California, San Diego (“UCSD”). See Note 16 for details of the percentages of royalties payable under this agreement. The initial fair value of this liability was determined using a discounted cash flow analysis incorporating the estimated future cash flows of royalty payments resulting from future sales. The discount rate used was the same as for the fair value of the developed technology. Deferred tax assets and liabilities arise from acquisition accounting adjustments where book values of certain assets and liabilities differ from their tax bases. Deferred tax assets and liabilities are recorded at the currently enacted rates which will be in effect at the time when the temporary differences are expected to reverse in the country where the underlying assets and liabilities are located. Raptor’s developed technology as of the acquisition date was located primarily in the United States where an estimated U.S. tax rate of 36.6% is being utilized and a significant deferred tax liability is recorded. Goodwill represents the excess of the preliminary acquisition consideration over the estimated fair value of net assets acquired and was recorded in the condensed consolidated balance sheet as of the acquisition date. The Company does not expect any portion of this goodwill to be deductible for tax purposes. Crealta Acquisition On January 13, 2016, the Company completed its acquisition of all the membership interests of Crealta. The acquisition added two medicines, KRYSTEXXA and MIGERGOT, to the Company’s medicine portfolio. The Crealta acquisition further diversified the Company’s portfolio of medicines and aligned with its focus of acquiring value-enhancing, clinically differentiated, long-life medicines that treat orphan diseases. The total consideration for the acquisition was approximately $539.7 million, including $24.9 million of cash acquired and $70.9 million paid to settle Crealta’s outstanding debt, Cash $ 536,206 Net settlements on the exercise of stock options and restricted stock units 3,526 Total consideration $ 539,732 During the three and nine months ended September 30, 2017, the Company incurred $0.1 million and $0.6 million, respectively, in Crealta acquisition-related costs including legal, retention bonuses and other professional and consulting fees, which were accounted for as “selling, general and administrative” expenses. During the three and nine months ended September 30, 2016, the Company incurred $0.4 million and $12.1 million, respectively, in Crealta acquisition-related costs including advisory, legal, accounting, valuation, severance, retention bonuses and other professional and consulting fees, of which $0.5 million and $11.5 million were accounted for as “selling, general and administrative”, respectively, a net expense reduction of $0.1 million and a net expense of $0.2 million were accounted for as “research and development”, respectively, and zero and $0.4 million were accounted for as “costs of goods sold”, respectively, in the condensed consolidated statements of comprehensive loss. Pursuant to ASC 805, the Company accounted for the Crealta acquisition as a business combination using the acquisition method of accounting. Identifiable assets and liabilities of Crealta, including identifiable intangible assets, were recorded based on their estimated fair values as of the date of the closing of the acquisition. The excess of the purchase price over the fair value of the net assets acquired was recorded as goodwill. Significant judgment was required in determining the estimated fair values of developed technology intangible assets, inventories and certain other assets and liabilities. Such valuation required estimates and assumptions including, but not limited to, estimating future cash flows and direct costs in addition to developing the appropriate discount rates and current market profit margins. The Company’s management believes the fair values recognized for the assets acquired and the liabilities assumed were based on reasonable estimates and assumptions. The following table summarizes the final fair values assigned to the assets acquired and the liabilities assumed by the Company (in thousands): (Liabilities assumed) and assets acquired: Allocation Accounts payable and accrued expenses $ (4,543 ) Accrued trade discounts and rebates (1,424 ) Deferred tax liabilities (20,141 ) Other non-current liabilities (6,900 ) Contingent royalty liabilities (51,300 ) Cash and cash equivalents 24,893 Accounts receivable 10,014 Inventories 149,363 Prepaid expenses and other current assets 1,382 Developed technology 428,200 Other non-current assets 275 Goodwill 9,913 Fair value of consideration paid $ 539,732 Inventories acquired included raw materials, work-in-process and finished goods for KRYSTEXXA and MIGERGOT. Inventories were recorded at their estimated fair values. The fair value of finished goods has been determined based on the estimated selling price, net of selling costs and a margin on the selling costs. The fair value of work-in-process has been determined based on estimated selling price, net of selling costs and costs to complete the manufacturing, and a margin on the selling and manufacturing costs. The fair value of raw materials was estimated to equal the replacement cost. A step-up in the value of inventory of $144.3 million was recorded in connection with the acquisition. During the three and nine months ended September 30, 2017, the Company recorded inventory step-up expense of $21.2 million and $54.9 million, respectively, related to KRYSTEXXA. Other tangible assets and liabilities were valued at their respective carrying amounts as management believes that these amounts approximated their acquisition date fair values. Other non-current liabilities represented an assumed $6.9 million probable contingent liability which was released to “other income (expense)” in the condensed consolidated statement of comprehensive loss during the year ended December 31, 2016. Identifiable intangible assets and liabilities acquired include developed technology and contingent royalties. The estimated fair values of the developed technology and contingent royalties represent valuations performed with the assistance of an independent appraisal firm based on management’s estimates, forecasted financial information and reasonable and supportable assumptions. Developed technology intangible assets reflect the estimated fair value of Crealta’s rights to KRYSTEXXA and MIGERGOT. The fair value of developed technology was determined using an income approach. The income approach explicitly recognizes that the fair value of an asset is premised upon the expected receipt of future economic benefits such as earnings and cash inflows based on current sales projections and estimated direct costs for Crealta’s medicines. Indications of value were developed by discounting these benefits to their acquisition-date worth at a discount rate of 27% for KRYSTEXXA and 23% for MIGERGOT. The fair value of the KRYSTEXXA and MIGERGOT developed technologies were capitalized as of the Crealta acquisition date and are subsequently being amortized over approximately twelve and ten years, respectively, which are the periods in which over 90% of the estimated cash flows are expected to be realized. The Company has assigned a fair value of $51.3 million to a contingent liability for royalties potentially payable under previously existing agreements related to KRYSTEXXA and MIGERGOT. The royalties for KRYSTEXXA are payable under the terms of a license agreement with Duke University (“Duke”) and Mountain View Pharmaceuticals (“MVP”). See Note 16 for details of the percentages of royalties payable under such agreements. The initial fair value of this liability was determined using a discounted cash flow analysis incorporating the estimated future cash flows of royalty payments resulting from future sales. The discount rate used was the same as for the fair value of the developed technology. The deferred tax liability recorded represents deferred tax liabilities assumed as part of the acquisition, net of deferred tax assets, related to net operating tax loss carryforwards of Crealta. Goodwill represents the excess of the acquisition consideration over the estimated fair value of net assets acquired and was recorded in the condensed consolidated balance sheet as of the acquisition date. The Company does not expect any portion of this goodwill to be deductible for tax purposes. Other Arrangements Collaboration and option agreement On November 8, 2016, the Company entered into a collaboration and option agreement with a privately held life-science entity. Under the terms of the agreement, the privately held life-science entity will conduct certain research and pre-clinical and clinical development activities. Upon execution of the agreement, the Company paid $0.1 million for the option to acquire certain assets of the privately held life-science entity for $25.0 million, which is exercisable on specified key dates. Under the collaboration and option agreement, the Company is required to pay up to $9.8 million upon the attainment of various milestones, primarily to fund clinical development costs for the medicine candidate. The Company paid $0.2 million in the fourth quarter of 2016, $0.9 million in the first quarter of 2017 and $1.5 million in the third quarter of 2017 related to milestones. The initial upfront amount paid of $0.1 million has been included in “other assets” in the Company’s condensed consolidated balance sheet as of December 31, 2016 and September 30, 2017. The aggregate $1.1 million amount paid in the fourth quarter of 2016 and the first quarter of 2017 were recorded as “research and development” expenses in the condensed consolidated statement of comprehensive loss during the year ended December 31, 2016, and the $1.5 million paid in the third quarter of 2017 was recorded as “research and development expense” during the three months ended September 30, 2017. The Company has determined that the privately held life-science entity is a variable interest entity (“VIE”) as it does not have enough equity to finance its activities without additional financial support. As the Company does not have the power to direct the activities of the VIE that most significantly affect its economic performance, it is not the primary beneficiary of, and does not consolidate the financial results of the VIE. The Company will reassess the appropriate accounting treatment for this arrangement throughout the life of the agreement and modify these accounting conclusions accordingly. Pro Forma Information The table below represents the condensed consolidated financial information for the Company for the nine months ended September 30, 2016 on a pro forma basis, assuming that the Crealta and Raptor acquisitions occurred as of January 1, 2016. The historical financial information has been adjusted to give effect to pro forma items that are directly attributable to the Crealta and Raptor acquisitions, and are expected to have a continuing impact on the consolidated results. These items include, among others, adjustments to record the amortization of definite-lived intangible assets, interest expense, debt discount and deferred financing costs associated with the debt in connection with the acquisitions. Additionally, the following table sets forth financial information and has been compiled from historical financial statements and other information, but is not necessarily indicative of the results that actually would have been achieved had the transactions occurred on the dates indicated or that may be achieved in the future (in thousands): For the Nine Months Ended September As reported Pro forma Pro forma adjustments Net sales $ 670,770 $ 99,571 $ 770,341 Net loss (36,292 ) (112,274 ) (148,566 ) The Company’s condensed consolidated statements of comprehensive loss for the nine months ended September 30, 2016 include KRYSTEXXA and MIGERGOT net sales as a result of the acquisition of Crealta of $61.6 million and $3.2 million, respectively. Crealta and Raptor have been integrated into the Company’s business and as a result of these integration efforts, the Company cannot distinguish between these operations and those of the Company’s legacy business. |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2017 | |
Inventory Disclosure [Abstract] | |
Inventories | NOTE 4 – INVENTORIES Inventories are stated at the lower of cost or market value. Inventories consist of raw materials, work-in-process and finished goods. The Company has entered into manufacturing and supply agreements for the manufacture of finished goods or the purchase of raw materials and production supplies. The Company’s inventories include the direct purchase cost of materials and supplies and manufacturing overhead costs. The components of inventories as of September 30, 2017 and December 31, 2016 consisted of the following (in thousands): September 30, 2017 December 31, 2016 Raw materials $ 17,412 $ 10,233 Work-in-process 16,230 85,022 Finished goods 52,885 79,533 Inventories, net $ 86,527 $ 174,788 Because inventory step-up expense is acquisition-related, will not continue indefinitely and has a significant effect on the Company’s gross profit, gross margin percentage and net income (loss) for all affected periods, the Company discloses balance sheet and income statement amounts related to inventory step-up within the notes to the condensed consolidated financial statements. Finished goods at September 30, 2017 included $40.4 million of stepped-up KRYSTEXXA inventory. Finished goods at December 31, 2016 included $27.7 million of stepped-up KRYSTEXXA inventory. Work-in-process at December 31, 2016 included $67.6 million of stepped-up KRYSTEXXA inventory. During the three and nine months ended September 30, 2017 the Company recorded $21.2 million and $54.9 million, respectively, of KRYSTEXXA inventory step-up expense. During the three and nine months ended September 30, 2016, the Company recorded $11.3 million and $27.9 million, respectively, of KRYSTEXXA and MIGERGOT inventory step-up expense. The Company expects that the KRYSTEXXA inventory step-up will be fully expensed by the end of the first quarter of 2018. Following that period, the Company expects the costs of goods sold related to KRYSTEXXA to decrease significantly to levels consistent with the historical cost of goods sold of Crealta. During the three and nine months ended September 30, 2017, the Company recorded zero and $40.8 million, respectively, of PROCYSBI and QUINSAIR inventory step-up expense. In addition, during the nine months ended September 30, 2017, the Company recorded $3.2 million of inventory step-up expense to “gain on divestiture” relating to PROCYSBI and QUINSAIR in connection with the Chiesi divestiture in June 2017. Finished goods at December 31, 2016 included $38.1 million of stepped-up PROCYSBI and QUINSAIR inventory. Work-in-process at December 31, 2016 included $5.9 million of stepped-up PROCYSBI and QUINSAIR inventory. |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 9 Months Ended |
Sep. 30, 2017 | |
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract] | |
Prepaid Expenses and Other Current Assets | NOTE 5- PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets as of September 30, 2017 and December 31, 2016 consisted of the following (in thousands): September 30, 2017 December 31, 2016 Medicine samples inventory $ 13,374 $ 10,192 Prepaid income taxes 10,559 9,155 Rabbi trust assets 5,717 3,073 Other prepaid expenses and other current assets 23,275 27,199 Prepaid expenses and other current assets $ 52,925 $ 49,619 |
Property and Equipment
Property and Equipment | 9 Months Ended |
Sep. 30, 2017 | |
Property Plant And Equipment [Abstract] | |
Property and Equipment | NOTE 6 – PROPERTY AND EQUIPMENT Property and equipment as of September 30, 2017 and December 31, 2016 consisted of the following (in thousands): September 30, 2017 December 31, 2016 Software $ 14,786 $ 10,876 Leasehold improvements 9,397 9,184 Machinery and equipment 4,931 4,566 Computer equipment 2,260 3,069 Other 2,689 2,664 34,063 30,359 Less accumulated depreciation (12,458 ) (8,319 ) Construction in process 95 17 Software implementation in process — 1,427 Property and equipment, net $ 21,700 $ 23,484 The Company capitalizes development costs associated with internal use software, including external direct costs of materials and services and payroll costs for employees devoting time to a software project. Costs incurred during the preliminary project stage, as well as costs for maintenance and training, are expensed as incurred. Software implementation in process as of December 31, 2016 was related to new enterprise resource planning software being implemented by the Company. The software was being implemented on a phased basis starting January 2016 and depreciation was not recorded on capitalized costs relating to a phase which had not yet entered service. Once a particular phase of the project entered service, associated capitalized costs were moved from “software implementation in process” to “software” in the table above, and depreciation commenced. Depreciation expense was $1.5 million and $1.2 million for the three months ended September 30, 2017 and 2016, respectively, and was $5.0 million and $3.3 million for the nine months ended September 30, 2017 and 2016, respectively. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 9 Months Ended |
Sep. 30, 2017 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | NOTE 7 – GOODWILL AND INTANGIBLE ASSETS Goodwill The gross carrying amount of goodwill as of September 30, 2017 was as follows (in thousands): Balance at December 31, 2016 $ 445,579 Divestiture during the period (16,285 ) Measurement period adjustments (2,853 ) Balance at September 30, 2017 $ 426,441 During the nine months ended September 30, 2017, in connection with the Chiesi divestiture, the Company recorded a reduction to goodwill of $16.3 million. In addition, the Company recorded measurement period adjustments to goodwill of $2.9 million related to the Raptor acquisition during the nine months ended September 30, 2017. During the year ended December 31, 2016, the Company recognized goodwill of $9.9 million and $189.1 million in connection with the Crealta and Raptor acquisitions, respectively. As of September 30, 2017, there were no accumulated goodwill impairment losses. See Note 3 for further details of goodwill acquired and disposed of in business acquisitions and divestitures. Intangible Assets As of September 30, 2017, the Company’s intangible assets consisted of developed technology related to ACTIMMUNE, BUPHENYL, KRYSTEXXA, MIGERGOT, PENNSAID 2%, PROCYSBI, RAVICTI, RAYOS and VIMOVO in the United States, and AMMONAPS, BUPHENYL, LODOTRA and PROCYSBI outside the United States, as well as customer relationships for ACTIMMUNE. During the year ended December 31, 2016, in connection with the acquisition of Crealta, the Company capitalized $402.2 million of developed technology related to KRYSTEXXA and $26.0 million of developed technology related to MIGERGOT. During the year ended December 31, 2016, in connection with the acquisition of Raptor, the Company capitalized $946.0 million of developed technology related to PROCYSBI. During the nine months ended September 30, 2017, in connection with the Chiesi divestiture, the Company recorded a reduction in the net book value of developed technology related to PROCYSBI of $47.3 million. See Note 3 for further details of intangible assets acquired in business acquisitions and disposed of in business divestitures. Prior to the fourth quarter of 2016, the Company had IPR&D of $66.0 million related to one research and development project to evaluate ACTIMMUNE in the treatment of FA. The fair value of the IPR&D was recorded as an indefinite-lived intangible asset and was being tested for impairment at least annually until completion or abandonment of the research and development efforts associated with the project. On December 8, 2016, the Company announced that the Phase 3 trial, STEADFAST, evaluating ACTIMMUNE for the treatment of FA did not meet its primary endpoint of a statistically significant change from baseline in the modified Friedreich’s Ataxia Rating Scale at twenty-six weeks versus treatment with placebo. In addition, the secondary endpoints did not meet statistical significance. No new safety findings were identified on initial review of data other than those already noted in the ACTIMMUNE prescribing information for approved indications. The Company, in conjunction with the independent Data Safety Monitoring Board, the principal investigator and the Friedreich’s Ataxia Research Alliance Collaborative Clinical Research Network in FA, determined that, based on the trial results, the STEADFAST program would be discontinued, including the twenty-six week extension study and the long-term safety study. The IPR&D had no alternative use or economic value as a result of the cancellation of the project, and the Company recorded an impairment charge of $66.0 million to “impairment of in-process research and development” in its condensed consolidated statements of comprehensive loss during the year ended December 31, 2016 to fully write off the value of the asset on its condensed consolidated balance sheet. The Company tests its intangible assets for impairment when events or circumstances may indicate that the carrying value of these assets exceeds their fair value. The Company does not believe there have been any circumstances or events that would indicate that the carrying value of any of its intangible assets, except for IPR&D as described above, was impaired at September 30, 2017 or December 31, 2016. Intangible assets as of September 30, 2017 and December 31, 2016 consisted of the following (in thousands): September 30, 2017 December 31, 2016 Cost Accumulated Amortization Net Book Value Cost Basis Accumulated Amortization Net Book Value Developed technology $ 3,115,695 $ (603,283 ) $ 2,512,412 $ 3,166,695 $ (399,511 ) $ 2,767,184 Customer relationships 8,100 (2,457 ) 5,643 8,100 (1,849 ) 6,251 Total intangible assets $ 3,123,795 $ (605,740 ) $ 2,518,055 $ 3,174,795 $ (401,360 ) $ 2,773,435 Amortization expense for the three months ended September 30, 2017 and 2016 was $68.7 million and $50.8 million, respectively, and was $208.1 million and $151.2 million for the nine months ended September 2017 and 2016, respectively. As of September 30, 2017 estimated future amortization expense was as follows (in thousands): 2017 (October to December) $ 68,666 2018 274,084 2019 261,092 2020 261,068 2021 253,373 Thereafter 1,399,772 Total $ 2,518,055 |
Other Assets
Other Assets | 9 Months Ended |
Sep. 30, 2017 | |
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract] | |
Other Assets | NOTE 8 - OTHER ASSETS Included in other assets at September 30, 2017 is $24.8 million which represents the long-term portion of the estimated amounts that are expected to be reimbursed from Chiesi for PROCYSBI and QUINSAIR royalties. |
Accrued Expenses
Accrued Expenses | 9 Months Ended |
Sep. 30, 2017 | |
Accrued Expenses [Member] | |
Accrued Liabilities / Expenses | NOTE 9 – ACCRUED EXPENSES Accrued expenses as of September 30, 2017 and December 31, 2016 consisted of the following (in thousands): September 30, 2017 December 31, 2016 Payroll-related expenses $ 47,730 $ 66,417 Consulting and professional services 35,660 33,614 Accrued interest 26,496 18,938 Contingent consideration liability 20,000 — Accrued other 32,815 31,296 Litigation settlement — 32,500 Accrued expenses $ 162,701 $ 182,765 Accrued payroll-related expenses at September 30, 2017 and December 31, 2016 included $2.3 million and $15.0 million, respectively, of severance and employee costs as a result of the Raptor acquisition. The Company anticipates that a significant amount of the Raptor acquisition-related cash payments will be complete by the fourth quarter of 2017. Accrued litigation settlement at December 31, 2016 included $32.5 million in relation to a litigation settlement with Express Scripts, Inc., which was paid in two equal installments in January 2017 and April 2017. The contingent consideration liability as of September 30, 2017 relates to an assumed contingent liability, arising from contingent payments associated with development, regulatory and commercial milestones following Raptor’s acquisition of QUINSAIR. This liability was presented in other long-term liabilities as of December 31, 2016 and was reclassified to accrued expenses as of September 30, 2017 to reflect the revised expectation that the payment would be made during the fourth quarter of 2017. The Company subsequently made this payment in November 2017. Accrued other as of September 30, 2017 and December 31, 2016 included $8.5 million and $9.5 million, respectively, related to a loss on inventory purchase commitments. During the year ended December 31, 2016, the Company committed to purchase additional units of ACTIMMUNE from Boehringer Ingelheim RCV GmbH & Co KG (“Boehringer Ingelheim”). These additional units of ACTIMMUNE were intended to cover anticipated demand if the results of the STEADFAST study of ACTIMMUNE for the treatment of FA had been successful. Following the discontinuation of the STEADFAST program during the year ended December 31, 2016, the Company recorded a loss of $14.3 million in “cost of goods sold” in the condensed consolidated statement of comprehensive loss for firm, non-cancellable and unconditional purchase commitments for quantities in excess of the Company’s current forecasts for future demand. During the nine months ended September 30, 2017, the Company renegotiated its purchase commitments with Boehringer Ingelheim and recorded a reduction of $2.7 million to the loss on inventory purchase commitments in “cost of goods sold”. “Other long-term liabilities” as of September 30, 2017 and December 31, 2016 included $2.7 million and $4.8 million, respectively, related to this loss on inventory purchase commitments. During the year ended December 31, 2016, the Company recorded $4.0 million related to costs to be incurred to discontinue the clinical trial. Accrued other as of September 30, 2017 and December 31, 2016 included $0.2 million and $4.0 million, respectively, related to these costs. During the three and nine months ended September 30, 2017, the Company recorded a reduction of $1.5 million to “research and development” expenses reflecting lower costs to discontinue the clinical trial than previously estimated. |
Accrued Trade Discounts and Reb
Accrued Trade Discounts and Rebates | 9 Months Ended |
Sep. 30, 2017 | |
Accrued Trade Discounts and Rebates [Member] | |
Valuation And Qualifying Accounts Disclosure [Line Items] | |
Accrued Liabilities / Expenses | NOTE 10 – ACCRUED TRADE DISCOUNTS AND REBATES Accrued trade discounts and rebates as of , 2016 (in thousands): September 30, 2017 December 31, 2016 Accrued wholesaler fees and commercial rebates $ 183,133 $ 47,460 Accrued co-pay and other patient assistance 175,991 188,504 Accrued government rebates and chargebacks 76,590 61,592 Accrued trade discounts and rebates 435,714 297,556 Invoiced wholesaler fees and commercial rebates, co-pay and other patient assistance, and government rebates and chargebacks in accounts payable 13,283 16,830 Total customer-related accruals and allowances $ 448,997 $ 314,386 The following table summarizes changes in the Company’s customer-related accruals and allowances from December 31, 2016 to September 30, 2017 (in thousands): Wholesaler Fees Co-Pay and Government and Commercial Other Patient Rebates and Rebates Assistance Chargebacks Total Balance at December 31, 2016 $ 47,651 $ 205,143 $ 61,592 $ 314,386 Measurement period adjustment — — (1,350 ) (1,350 ) Current provisions relating to sales during the nine months ended September 30, 2017 472,118 1,406,614 245,547 2,124,279 Adjustments relating to prior-year sales 5,580 (59 ) (4,904 ) 617 Payments relating to sales during the nine months ended September 30, 2017 (288,749 ) (1,230,603 ) (156,118 ) (1,675,470 ) Payments relating to prior-year sales (53,043 ) (205,084 ) (55,338 ) (313,465 ) Balance at September 30, 2017 $ 183,557 $ 176,011 $ 89,429 $ 448,997 |
Accrued Royalties
Accrued Royalties | 9 Months Ended |
Sep. 30, 2017 | |
Accrued Royalties [Member] | |
Payables And Accruals [Line Items] | |
Accrued Liabilities / Expenses | NOTE 11 – ACCRUED ROYALTIES During the nine months ended September 30, 2017, changes to the liability for royalties for medicines acquired through business combinations consisted of the following (in thousands): Balance as of December 31, 2016 $ 334,274 Reclassification to other long-term liabilities (5,233 ) Remeasurement of royalty liabilities (2,944 ) Royalty payments (33,796 ) Accretion expense 38,347 Other royalty expense 297 Balance as of September 30, 2017 330,945 Accrued royalties - current portion as of September 30, 2017 62,273 Accrued royalties, net of current as of September 30, 2017 $ 268,672 The reclassification to other long-term liabilities in the table above relates to the reclassification of a contingent royalty liability for PROCYSBI to other long-term liabilities as a result of the Chiesi divestiture. |
Segment and Other Information
Segment and Other Information | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Segment and Other Information | NOTE 12 – SEGMENT AND OTHER INFORMATION The following table presents the amount and percentage of gross sales from customers that represented more than 10% of the Company’s gross sales included in its single operating segment, and all other customers as a group (in thousands, except percentages): For the Three Months Ended September 30, 2017 2016 Amount % of Amount % of Gross Sales Sales Customer A $ 314,077 31 % $ 365,807 42 % Customer B 267,818 27 % 212,392 25 % Customer C 139,981 14 % 106,360 12 % Other Customers 280,241 28 % 181,291 21 % Gross Sales $ 1,002,117 100 % $ 865,850 100 % For the Nine Months Ended September 30, 2017 2016 Amount % of Gross Amount % of Gross Sales Sales Customer A $ 941,268 31 % $ 1,067,720 45 % Customer B 856,677 29 % 458,951 20 % Customer C 423,446 14 % 260,514 11 % Other Customers 780,983 26 % 563,300 24 % Gross Sales $ 3,002,374 100 % $ 2,350,485 100 % |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | NOTE 13 – FAIR VALUE MEASUREMENTS The following tables and paragraphs set forth the Company’s financial instruments that are measured at fair value on a recurring basis within the fair value hierarchy. Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires management to make judgments and consider factors specific to the asset or liability. The following describes three levels of inputs that may be used to measure fair value: Level 1 —Observable inputs such as quoted prices in active markets for identical assets or liabilities; Level 2 —Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and Level 3 —Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company utilizes the market approach to measure fair value for its money market funds. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. As of September 30, 2017, the Company’s restricted cash included bank time deposits which were measured at fair value using Level 2 inputs and their carrying values were approximately equal to their fair values. Level 2 inputs, obtained from various third-party data providers, represent quoted prices for similar assets in active markets, or these inputs were derived from observable market data, or if not directly observable, were derived from or corroborated by other observable market data. Other current assets and other long-term liabilities recorded at fair value on a recurring basis are composed of investments held in a rabbi trust and the related deferred liability for deferred compensation arrangements. Quoted prices for this investment, primarily in mutual funds, are available in active markets. Thus, the Company’s investments related to deferred compensation arrangements and the related long-term liability are classified as Level 1 measurements in the fair value hierarchy. The Company transfers its financial assets and liabilities between the fair value hierarchies at the end of each reporting period. There were no transfers between the different levels of the fair value hierarchy during the three and nine months ended September 30, 2017 and 2016. Assets and liabilities measured at fair value on a recurring basis The following tables set forth the Company’s financial assets and liabilities at fair value on a recurring basis as of September 30, 2017 and December 31, 2016 (in thousands): September 30, 2017 Level 1 Level 2 Level 3 Total Assets: Bank time deposits $ — $ 3,000 $ — $ 3,000 Money market funds 552,000 — — 552,000 Other current assets 5,717 — — 5,717 Total assets at fair value $ 557,717 $ 3,000 $ — $ 560,717 Liabilities: Other long-term liabilities (5,717 ) — — (5,717 ) Total liabilities at fair value $ (5,717 ) $ — $ — $ (5,717 ) December 31, 2016 Level 1 Level 2 Level 3 Total Assets: Bank time deposits $ — $ 3,000 $ — $ 3,000 Money market funds 170,000 — — 170,000 Other current assets 3,038 — — 3,038 Total assets at fair value $ 173,038 $ 3,000 $ — $ 176,038 Liabilities: Other long-term liabilities (3,038 ) — — (3,038 ) Total liabilities at fair value $ (3,038 ) $ — $ — $ (3,038 ) |
Debt Agreements
Debt Agreements | 9 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Debt Agreements | NOTE 14 – DEBT AGREEMENTS The Company’s outstanding debt balances as of September 30, 2017 and December 31, 2016 consisted of the following (in thousands): September 30, 2017 December 31, 2016 2017 Term Loan Facility $ 847,875 — 2015 Term Loan Facility — 394,000 2016 Incremental Loan Facility — 375,000 2023 Senior Notes 475,000 475,000 2024 Senior Notes 300,000 300,000 Exchangeable Senior Notes 400,000 400,000 Total face value 2,022,875 1,944,000 Debt discount (113,508 ) (126,352 ) Deferred financing fees (11,790 ) (10,155 ) Total long-term debt 1,897,577 1,807,493 Less: current maturities 8,500 7,750 Long-term debt, net of current maturities $ 1,889,077 $ 1,799,743 2017 Term Loan Facility On March 29, 2017, HPI and Horizon Pharma USA, Inc. (“HPUSA” and, together with HPI, in such capacity, the “Borrowers”), wholly-owned subsidiaries of the Company, borrowed $850.0 million aggregate principal amount of loans (the “March 2017 Refinancing Loans”) pursuant to an amendment (the “March 2017 Refinancing Amendment”) to the credit agreement, dated as of May 7, 2015 (as amended by the 2016 Amendment described below, the “2016 Credit Agreement” and, the 2016 Credit Agreement as amended by the March 2017 Refinancing Amendment, the “March 2017 Credit Agreement”), by and among the Borrowers, the Company and certain of its subsidiaries as guarantors, the lenders party thereto from time to time and Citibank, N.A., as administrative agent and collateral agent (the “2017 Term Loan Facility”). The March 2017 Credit Agreement provided for (i) the March 2017 Refinancing Loans, (ii) one or more uncommitted additional incremental loan facilities subject to the satisfaction of certain financial and other conditions, and (iii) one or more uncommitted refinancing loan facilities with respect to loans thereunder. The March 2017 Credit Agreement allowed for the Company and certain of its subsidiaries to become borrowers under incremental or refinancing facilities. The March 2017 Credit Agreement was amended pursuant to the October 2017 Refinancing Amendment described in Note 21 below (the March 2017 Credit Agreement as amended by the October 2017 Refinancing Amendment , the “Credit Agreement”). The March 2017 Refinancing Loans were incurred as a separate new class of term loans under the March 2017 Credit Agreement with substantially the same terms as the previously outstanding senior secured term loans incurred on May 7, 2015 (the “2015 Loans”) and the outstanding senior secured term loans incurred on October 25, 2016 (the “2016 Loans” and, together with the 2015 Loans, the “March 2017 Refinanced Loans”), except as described below. The March 2017 Refinancing Loans bore interest, at the Borrowers’ option, at a rate equal to either the London Inter-Bank Offer Rate (“LIBOR”), plus an applicable margin of 3.75% per year (subject to a LIBOR floor of 1.00%), or the adjusted base rate plus 2.75%. The adjusted base rate was defined as the greater of (a) LIBOR (using one-month interest period) plus 1.00%, (b) prime rate, (c) fed funds plus 0.5%, and (d) 2.00%. The Borrowers used a portion of the proceeds of the March 2017 Refinancing Loans to repay the March 2017 Refinanced Loans, which totaled $769.0 million. The Company elected to exercise its reinvestment rights under the mandatory prepayment provisions of the March 2017 Credit Agreement with respect to the net proceeds from the Chiesi divestiture. To the extent the Company did not apply such net proceeds to permitted acquisitions (including the acquisition of rights to products and products lines) and/or the acquisition of capital assets within 365 days of the receipt thereof (or commit to so apply and then apply within 180 days after the end of such 365-day period), the Borrowers under the March 2017 Credit Agreement would have had to make a mandatory prepayment under the March 2017 Credit Agreement in an amount equal to the unapplied net proceeds. Until such time, the net proceeds were not legally restricted for use. As of September 30, 2017, the Company had applied a portion of such net proceeds to the acquisition of additional rights to interferon gamma-1b. See Note 3 for further details of this acquisition. The obligations under the March 2017 Credit Agreement (including obligations in respect of the March 2017 Refinancing Loans) and any swap obligations and cash management obligations owing to a lender (or an affiliate of a lender) thereunder were guaranteed by the Company and each of the Company’s existing and subsequently acquired or formed direct and indirect subsidiaries (other than certain immaterial subsidiaries, subsidiaries whose guarantee would result in material adverse tax consequences and subsidiaries whose guarantee is prohibited by applicable law). The obligations under the March 2017 Credit Agreement (including obligations in respect of the March 2017 Refinancing Loans) and any such swap and cash management obligations were secured, subject to customary permitted liens and other agreed upon exceptions, by a perfected security interest in (i) all tangible and intangible assets of the Borrowers and the guarantors, except for certain customary excluded assets, and (ii) all of the capital stock owned by the Borrowers and guarantors thereunder (limited, in the case of the stock of certain non-U.S. subsidiaries of the Borrowers, to 65% of the capital stock of such subsidiaries). The Borrowers and the guarantors under the March 2017 Credit Agreement and/or Credit Agreement, as applicable, are individually and collectively referred to herein as a “Loan Party” and the “Loan Parties,” as applicable. Borrowers under the March 2017 Credit Agreement were permitted to make voluntary prepayments of the loans under the March 2017 Credit Agreement at any time without payment of a premium, except that with respect to the March 2017 Refinancing Loans, a 1.00% premium would have applied to a repayment of the March 2017 Refinancing Loans in connection with a repricing of, or any amendment to the March 2017 Credit Agreement in a repricing of, such loans effected on or prior to the date that is six months following March 29, 2017. The Borrowers were required to make mandatory prepayments of loans under the March 2017 Credit Agreement (without payment of a premium) with (a) net cash proceeds from certain non-ordinary course asset sales (subject to reinvestment rights and other exceptions), (b) casualty proceeds and condemnation awards (subject to reinvestment rights and other exceptions), (c) net cash proceeds from issuances of debt (other than certain permitted debt), and (d) 50% of the Company’s excess cash flow (subject to decrease to 25% or 0% if the Company’s first lien leverage ratio is less than 2.25:1 or 1.75:1, respectively). The March 2017 Refinancing Loans amortized in equal quarterly installments beginning on June 30, 2017 in an aggregate annual amount equal to 1.00% of the original principal amount thereof, with any remaining balance payable on March 29, 2024, the final maturity date of the March 2017 Refinancing Loans. The March 2017 Credit Agreement contained customary representations and warranties and customary affirmative and negative covenants, including, among other things, restrictions on indebtedness, liens, investments, mergers, dispositions, prepayment of other indebtedness and dividends and other distributions. Events of default under the March 2017 Credit Agreement included: (i) the failure by any Borrower to timely make payments due under the March 2017 Credit Agreement; (ii) material misrepresentations or misstatements in any representation or warranty by any Loan Party when made; (iii) failure by any Loan Party to comply with the covenants under the March 2017 Credit Agreement and other related agreements; (iv) certain defaults under a specified amount of other indebtedness of the Company or its subsidiaries; (v) insolvency or bankruptcy-related events with respect to the Company or any of its material subsidiaries; (vi) certain undischarged judgments against the Company or any of its restricted subsidiaries; (vii) certain ERISA-related events reasonably expected to have a material adverse effect on the Company and its restricted subsidiaries taken as a whole; (viii) certain security interests or liens under the loan documents ceasing to be, or being asserted by the Company or its restricted subsidiaries not to be, in full force and effect; (ix) any loan document or material provision thereof ceasing to be, or any challenge or assertion by any Loan Party that such loan document or material provision is not, in full force and effect; and (x) the occurrence of a change of control. If one or more events of default occurred and continued beyond any applicable cure period, the administrative agent would have been able to, with the consent of the lenders holding a majority of the loans and commitments under the facilities, or would have been able to, at the request of such lenders, terminate the commitments of the lenders to make further loans and declare all of the obligations of the Loan Parties under the March 2017 Credit Agreement to be immediately due and payable. The Company was, as of September 30, 2017, in compliance with the March 2017 Credit Agreement and is currently in compliance with the Credit Agreement. As of September 30, 2017, the fair value of the 2017 Term Loan Facility was approximately $847.9 million, categorized as a Level 2 instrument, as defined in Note 13. 2016 Incremental Loan Facility and 2015 Term Loan Facility On May 7, 2015, HPI, as borrower, and the Company and certain of its subsidiaries, as guarantors, entered into a credit agreement (the “2015 Credit Agreement”) with Citibank, N.A., as administrative and collateral agent, and the lenders from time to time party thereto providing for (i) a six-year $400.0 million term loan facility (the Loans under the 2015 Term Loan Facility bore interest, at each borrower’s option, at a rate equal to either the LIBOR, plus HPI borrowed the full $400.0 million available on the 2015 Term Loan Facility on May 7, 2015 as a LIBOR-based borrowing. On October 25, 2016 and in connection with the financing for the acquisition of Raptor, HPI and HPUSA (together, in such capacity, the “Incremental Borrowers”) entered into an amendment to the 2015 Credit Agreement (the “2016 Amendment”) with Citibank, N.A., as administrative and collateral agent, and Bank of America, N.A., as the incremental B-1 lender thereunder, pursuant to which the Incremental Borrowers borrowed $375.0 million aggregate principal amount of loans (the “2016 Incremental Loan Facility”). The 2016 Incremental Loan Facility was incurred as a separate class of term loans under the 2015 Credit Agreement with the same terms as the loans under the 2015 Term Loan Facility, except as described below. The 2016 Loans under the 2016 Incremental Loan Facility bore interest, at the Incremental Borrowers’ option, at a rate equal to either LIBOR plus an applicable margin of 4.50% per year (subject to a LIBOR floor of 1.00%), or the adjusted base rate plus 3.50%. The terms of the 2015 Loans provided for an amendment such that the effective yield of the 2015 Loans would not be less than the effective yield of the 2016 Loans minus 0.50%. Consequently, the issuance of the 2016 Loans resulted in an increase of the interest rate applicable to the 2015 Loans, as of October 25, 2016, to LIBOR plus 4.00%, subject to a LIBOR floor of 1.00% (an initial interest rate of 5.00%). On March 29, 2017, the The 2015 Loans and the 2016 Loans were repaid, and a portion of the repayment was accounted for as a debt modification and a portion was accounted for as a debt extinguishment. Under debt extinguishment accounting, the Company recorded a charge of $0.5 million to “loss on debt extinguishment” in the condensed consolidated statements of comprehensive loss, which reflected the write-off of the unamortized portion of debt discount and deferred financing costs previously incurred and a one percent prepayment penalty fee. Under debt modification accounting, the Company capitalized an incremental $5.8 million of debt discount and deferred financing fees. 2024 Senior Notes On October 25, 2016, HPI and HPUSA (together, in such capacity, the “2024 Issuers”) The net proceeds from the offering of the 2024 Senior Notes were approximately $291.9 million, after deducting the initial purchasers’ discount and offering expenses payable by the 2024 Issuers. The obligations under the 2024 Senior Notes are the 2024 Issuers’ general unsecured senior obligations and are fully and unconditionally guaranteed on a senior unsecured basis by the Company and all of the Company’s direct and indirect subsidiaries that are guarantors from time to time under the Credit Agreement. The Company used the net proceeds from the offering of the 2024 Senior Notes as well as $375.0 million principal amount of 2016 Loans under the to fund a portion of the acquisition of Raptor, repay Raptor’s outstanding debt, and pay any prepayment premiums, fees and expenses in connection with the foregoing. The 2024 Senior Notes accrue interest at an annual rate of 8.750% payable semiannually in arrears on May 1 and November 1 of each year, beginning on May 1, 2017. The 2024 Senior Notes will mature on November 1, 2024, unless earlier repurchased or redeemed. Except as described below, the 2024 Senior Notes may not be redeemed before November 1, 2019. Thereafter, some or all of the 2024 Senior Notes may be redeemed at any time at specified redemption prices, plus accrued and unpaid interest to the redemption date. At any time prior to November 1, 2019, some or all of the 2024 Senior Notes may be redeemed at a price equal to 100% of the aggregate principal amount thereof, plus a make-whole premium and accrued and unpaid interest to the redemption date. Also prior to November 1, 2019, up to 35% of the aggregate principal amount of the 2024 Senior Notes may be redeemed at a redemption price of 108.75% of the aggregate principal amount thereof, plus accrued and unpaid interest, with the net proceeds of certain equity offerings. In addition, the 2024 Senior Notes may be redeemed in whole but not in part at a redemption price equal to 100% of the principal amount plus accrued and unpaid interest and additional amounts, if any, to, but excluding, the redemption date, if on the next date on which any amount would be payable in respect of the 2024 Senior Notes, the 2024 Issuers or any guarantor is or would be required to pay additional amounts as a result of certain tax-related events. If the Company undergoes a change of control, the 2024 Issuers will be required to make an offer to purchase all of the 2024 Senior Notes at a price in cash equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest to, but not including, the repurchase date. If the Company or certain of its subsidiaries engages in certain asset sales, the 2024 Issuers will be required under certain circumstances to make an offer to purchase the 2024 Senior Notes at 100% of the principal amount thereof, plus accrued and unpaid interest to the repurchase date. The indenture governing the 2024 Senior Notes contains covenants that limit the ability of the Company and its restricted subsidiaries to, among other things, pay dividends or distributions, repurchase equity, prepay junior debt and make certain investments, incur additional debt and issue certain preferred stock, incur liens on assets, engage in certain asset sales, merge, consolidate with or merge or sell all or substantially all of their assets, enter into transactions with affiliates, designate subsidiaries as unrestricted subsidiaries, and allow to exist certain restrictions on the ability of restricted subsidiaries to pay dividends or make other payments to the Company. Certain of the covenants will be suspended during any period in which the notes receive investment grade ratings. The indenture also includes customary events of default. The Company was, as of September 30, 2017 As of September 30, 2017, the fair value of the 2024 Senior Notes was approximately $313.5 million, categorized as a Level 2 instrument, as defined in Note 13. 2023 Senior Notes On April 29, 2015, Horizon Pharma Financing Inc. (“Horizon Financing”), a wholly owned subsidiary of the Company, completed a private placement of $475.0 million aggregate principal amount of 6.625% Senior Notes due 2023 (the “2023 Senior Notes”) to certain investment banks acting as initial purchasers who subsequently resold the 2023 Senior Notes to qualified institutional buyers as defined in Rule 144A under the Securities Act, and in offshore transactions to non-U.S. persons in reliance on Regulation S under the Securities Act. The net proceeds from the offering of the 2023 Senior Notes were approximately $462.3 million, after deducting the initial purchasers’ discount and offering expenses payable by Horizon Financing. In connection with the closing of the Hyperion acquisition on May 7, 2015, Horizon Financing merged with and into HPI and, as a result, the 2023 Senior Notes became HPI’s general unsecured senior obligations. The obligations under the 2023 Senior Notes are fully and unconditionally guaranteed on a senior unsecured basis by the Company and all of the Company’s direct and indirect subsidiaries that are guarantors from time to time under the Credit Agreement. The 2023 Senior Notes accrue interest at an annual rate of 6.625% payable semiannually in arrears on May 1 and November 1 of each year, beginning on November 1, 2015. The 2023 Senior Notes will mature on May 1, 2023, unless earlier repurchased or redeemed. Except as described below, the 2023 Senior Notes may not be redeemed before May 1, 2018. Thereafter, some or all of the 2023 Senior Notes may be redeemed at any time at specified redemption prices, plus accrued and unpaid interest to the redemption date. At any time prior to May 1, 2018, some or all of the 2023 Senior Notes may be redeemed at a price equal to 100% of the aggregate principal amount thereof, plus a make-whole premium and accrued and unpaid interest to the redemption date. Also prior to May 1, 2018, up to 35% of the aggregate principal amount of the 2023 Senior Notes may be redeemed at a redemption price of 106.625% of the aggregate principal amount thereof, plus accrued and unpaid interest, with the net proceeds of certain equity offerings. In addition, the 2023 Senior Notes may be redeemed in whole but not in part at a redemption price equal to 100% of the principal amount plus accrued and unpaid interest and additional amounts, if any, to, but excluding, the redemption date, if on the next date on which any amount would be payable in respect of the 2023 Senior Notes, HPI or any guarantor is or would be required to pay additional amounts as a result of certain tax-related events. If the Company undergoes a change of control, HPI will be required to make an offer to purchase all of the 2023 Senior Notes at a price in cash equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest to, but not including, the repurchase date. If the Company or certain of its subsidiaries engages in certain asset sales, HPI will be required under certain circumstances to make an offer to purchase the 2023 Senior Notes at 100% of the principal amount thereof, plus accrued and unpaid interest to the repurchase date. The indenture governing the 2023 Senior Notes contains covenants that limit the ability of the Company and its restricted subsidiaries to, among other things, pay dividends or distributions, repurchase equity, prepay junior debt and make certain investments, incur additional debt and issue certain preferred stock, incur liens on assets, engage in certain asset sales, merge, consolidate with or merge or sell all or substantially all of their assets, enter into transactions with affiliates, designate subsidiaries as unrestricted subsidiaries, and allow to exist certain restrictions on the ability of restricted subsidiaries to pay dividends or make other payments to the Company. Certain of the covenants will be suspended during any period in which the notes receive investment grade ratings. The indenture governing the 2023 Senior Notes The Company was, as of September 30, 2017 As of September 30, 2017, the fair value of the 2023 Senior Notes was approximately $464.3 million, categorized as a Level 2 instrument, as defined in Note 13. Exchangeable Senior Notes On March 13, 2015, Horizon Investment completed a private placement of $400.0 million aggregate principal amount of Exchangeable Senior Notes to certain investment banks acting as initial purchasers who subsequently resold the Exchangeable Senior Notes to qualified institutional buyers as defined in Rule 144A under the Securities Act. The net proceeds from the offering of the Exchangeable Senior Notes were approximately $387.2 million, after deducting the initial purchasers’ discount and offering expenses payable by Horizon Investment. The Exchangeable Senior Notes are fully and unconditionally guaranteed, on a senior unsecured basis, by the Company (the “Guarantee”). The Exchangeable Senior Notes and the Guarantee are Horizon Investment’s and the Company’s senior unsecured obligations. The Exchangeable Senior Notes accrue interest at an annual rate of 2.50% payable semiannually in arrears on March 15 and September 15 of each year, beginning on September 15, 2015. The Exchangeable Senior Notes will mature on March 15, 2022, unless earlier exchanged, repurchased or redeemed. The initial exchange rate is 34.8979 ordinary shares of the Company per $1,000 principal amount of the Exchangeable Senior Notes (equivalent to an initial exchange price of approximately $28.66 per ordinary share). The exchange rate will be subject to adjustment in some events but will not be adjusted for any accrued and unpaid interest. In addition, following certain corporate events that occur prior to the maturity date or upon a tax redemption, Horizon Investment will increase the exchange rate for a holder who elects to exchange its Exchangeable Senior Notes in connection with such a corporate event or a tax redemption in certain circumstances. Other than as described below, the Exchangeable Senior Notes may not be redeemed by the Company. Issuer Redemptions: Optional Redemption for Changes in the Tax Laws of a Relevant Taxing Jurisdiction Horizon Investment may redeem the Exchangeable Senior Notes at its option, prior to March 15, 2022, in whole but not in part, in connection with certain tax-related events. Provisional Redemption on or After March 20, 2019 On or after March 20, 2019, Horizon Investment may redeem for cash all or a portion of the Exchangeable Senior Notes if the last reported sale price of ordinary shares of the Company has been at least 130% of the exchange price then in effect for at least twenty trading days whether or not consecutive) during any thirty consecutive trading day period ending on, and including, the trading day immediately preceding the date on which Horizon Investment provide written notice of redemption. The redemption price will be equal to 100% of the principal amount of the Exchangeable Senior Notes to be redeemed, plus accrued and unpaid interest to, but not including, the redemption date; provided that if the redemption date occurs after a regular record date and on or prior to the corresponding interest payment date, Horizon Investment will pay the full amount of accrued and unpaid interest due on such interest payment date to the record holder of the Exchangeable Senior Notes on the regular record date corresponding to such interest payment date, and the redemption price payable to the holder who presents an Exchangeable Senior Note for redemption will be equal to 100% of the principal amount of such Exchangeable Senior Note. Holder Exchange Rights: Holders may exchange all or any portion of their Exchangeable Senior Notes at their option at any time prior to the close of business on the business day immediately preceding December 15, 2021 only upon satisfaction of one or more of the following conditions: 1. Exchange upon Satisfaction of Sale Price Condition 2. Exchange upon Satisfaction of Trading Price Condition 3. Exchange upon Notice of Redemption As of September 30, 2017, none of the above conditions had been satisfied and no exchange of Exchangeable Senior Notes had been triggered. On or after December 15, 2021, a holder may exchange all or any portion of its Exchangeable Senior Notes at any time prior to the close of business on the second scheduled trading day immediately preceding the maturity date regardless of the foregoing conditions. Upon exchange, Horizon Investment will settle exchanges of the Exchangeable Senior Notes by paying or causing to be delivered, as the case may be, cash, ordinary shares or a combination of cash and ordinary shares, at its election. The Company recorded the Exchangeable Senior Notes under the guidance in Topic ASC 470-20, Debt with Conversion and Other Options, As of September 30, 2017, the fair value of the Exchangeable Senior Notes was approximately $361.0 million, categorized as a Level 2 instrument, as defined in Note 13. |
Other Long-Term Liabilities
Other Long-Term Liabilities | 9 Months Ended |
Sep. 30, 2017 | |
Other Liabilities Disclosure [Abstract] | |
Other Long-Term Liabilities | NOTE 15 – OTHER LONG-TERM LIABILITIES Included in other long-term liabilities at September 30, 2017 and December 31, 2016, is $26.6 million and $25.5 million, respectively, representing the fair value of the long-term portion of the contingent liability for royalties potentially payable under agreements related to PROCYSBI and QUINSAIR. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2017 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 16 – COMMITMENTS AND CONTINGENCIES Lease Obligations The Company has the following office space lease agreements in place for real properties: Location Approximate Square Feet Lease Expiry Date Dublin, Ireland 18,900 November 3, 2029 Lake Forest, Illinois (1) 160,000 March 31, 2024 Novato, California (2) 61,000 August 31, 2021 Deerfield, Illinois (3) 32,300 June 30, 2018 Brisbane, California 20,100 November 30, 2019 Mannheim, Germany 14,300 December 31, 2018 Chicago, Illinois 6,500 December 31, 2018 Reinach, Switzerland 3,500 May 31, 2020 Washington, D.C. 1,000 December 31, 2018 (1) In connection with the Lake Forest, Illinois lease, the Company has provided a $2.0 million letter of credit to the landlord, through a commercial bank. (2) During March 2017, the Company vacated an area of the office space in Novato, California. During March and April 2017, the Company entered into sublease arrangements for this space with third parties. (3) During January 2016, the Company vacated the premises in Deerfield, Illinois and began occupying the premises in Lake Forest, Illinois. During April 2017, the Company entered into a sublease arrangement for a portion of this space with a third party. During June 2017, the Company terminated a portion of the lease, resulting in 32,300 square feet remaining. Following the Chiesi divestiture in June 2017, the Company ceased to hold a lease obligation in Utrecht in the Netherlands. Purchase Commitments In August 2007, the Company entered into a manufacturing and supply agreement with Jagotec AG (“Jagotec”), which was amended in March 2011 and in January 2017. Under the agreement, Jagotec or its affiliates are required to manufacture and supply RAYOS/LODOTRA exclusively to the Company in bulk. The earliest the agreement can expire is December 31, 2023, and the minimum purchase commitment is in force until December 2023. At September 30, 2017, the minimum purchase commitment based on tablet pricing in effect under the agreement was $6.7 million through December 2023. Additionally, purchase orders relating to the manufacture of RAYOS/LODOTRA of $1.2 million were outstanding at September 30, 2017. In May 2011, the Company entered into a manufacturing and supply agreement with Sanofi-Aventis U.S. LLC (“Sanofi-Aventis U.S.”), and amended the agreement effective as of September 25, 2013. Pursuant to the agreement, as amended, Sanofi-Aventis U.S. is obligated to manufacture and supply DUEXIS to the Company in final, packaged form, and the Company is obligated to purchase DUEXIS exclusively from Sanofi-Aventis U.S. for the commercial requirements of DUEXIS in North America, South America and certain countries and territories in Europe, including the European Union (“EU”) member states and Scandinavia. The agreement term extends until May 2019, and automatically renews for successive two-year terms unless terminated by either party upon two years prior written notice. At September 30, 2017, the Company had a binding purchase commitment to Sanofi-Aventis U.S. for DUEXIS of $6.3 million, which is to be delivered through March 2018. In July 2013, Vidara Therapeutics International Public Limited Company (“Vidara”) and Boehringer Ingelheim entered into an exclusive supply agreement, which the Company assumed in September 2014 and amended effective as of September 5, 2014 and June 1, 2015. That supply agreement was replaced with an exclusive global supply agreement between the Company and Boehringer Ingelheim Biopharmaceuticals GmbH (“Boehringer Ingelheim Biopharmaceuticals”) effective June 30, 2017. Under the agreement, Boehringer Ingelheim Biopharmaceuticals is required to manufacture and supply ACTIMMUNE and IMUKIN to the Company. The Company is required to purchase minimum quantities of finished medicine per annum through July 2024. During the year ended December 31, 2016, the Company committed to purchase additional amounts of ACTIMMUNE from Boehringer Ingelheim. These additional amounts were intended to cover anticipated demand if the results of the STEADFAST study of ACTIMMUNE for the treatment of FA had been successful. As of September 30, 2017, the minimum binding purchase commitment to Boehringer Ingelheim Biopharmaceuticals was $22.5 million (converted using a Dollar-to-Euro exchange rate of 1.1814) through July 2024. Following the discontinuation of the STEADFAST program, the Company recorded a loss of $14.3 million in “cost of goods sold” in the condensed consolidated statement of comprehensive loss during the year ended December 31, 2016 for a portion of this commitment which represented firm, non-cancellable and unconditional purchase commitments for quantities in excess of the Company’s current forecasts for future demand. During the nine months ended September 30, 2017, the Company renegotiated the purchase commitment due to Boehringer Ingelheim and recorded $2.7 million as a reduction to “cost of goods sold”. During the year ended December 31, 2016, the Company also committed to incur an additional $14.9 million for the harmonization of the drug substance manufacturing process with Boehringer Ingelheim. These additional costs will be incurred during the years 2017 through 2021. During the three and nine months ended September 30, 2017, the Company recorded $5.7 million and $12.2 million, respectively, in its condensed consolidated statement of comprehensive loss related to the harmonization of the drug substance manufacturing process. In November 2013, the Company entered into a long-term master manufacturing services and product agreement with Patheon Pharmaceuticals Inc. (“Patheon”) pursuant to which Patheon is obligated to manufacture VIMOVO for the Company through December 31, 2019. The Company agreed to purchase a specified percentage of VIMOVO requirements for the United States from Patheon. The Company must pay an agreed price for final, packaged VIMOVO supplied by Patheon as set forth in the Patheon manufacturing agreement, subject to adjustments, including certain unilateral adjustments by Patheon, such as annual adjustments for inflation and adjustments to account for certain increases in the cost of components of VIMOVO other than active materials. The Company issues twelve-month forecasts of the volume of VIMOVO that the Company expects to order. The first six months of the forecast are considered binding firm orders. At September 30, 2017, the Company had a binding purchase commitment with Patheon for VIMOVO of $1.5 million which is to be delivered through December 2017. In October 2014, in connection with the acquisition of the U.S. rights to PENNSAID 2% from Nuvo Research Inc., (“Nuvo”), the Company and Nuvo entered into an exclusive supply agreement. Under the supply agreement, which was amended in February 2016, Nuvo is obligated to manufacture and supply PENNSAID 2% to the Company. The term of the supply agreement is through December 31, 2029, but the agreement may be terminated earlier by either party for any uncured material breach by the other party of its obligations under the supply agreement or upon the bankruptcy or similar proceeding of the other party. At least ninety days prior to the first day of each calendar month during the term of the supply agreement, the Company submits a binding written purchase order to Nuvo for PENNSAID 2% in minimum batch quantities. At September 30, 2017, the Company had a binding purchase commitment with Nuvo for PENNSAID 2% of $4.3 million through January 2018. In November 2010, Raptor and Patheon entered into a manufacturing services agreement, which the Company assumed as a result of its acquisition of Raptor. Under the agreement, which was amended in April 2012 and June 2013, Patheon is obligated to manufacture PROCYSBI for the Company through December 31, 2019. The Company must provide Patheon with rolling, non-binding forecasts of PROCYSBI, with a portion of the forecast being a firm written order. In November 2010, Raptor and Cambrex Profarmaco Milano (“Cambrex”) entered into an active pharmaceutical ingredient (“API”) supply agreement, which the Company assumed as a result of its acquisition of Raptor. Under the agreement, which was amended in April 2013 and August 2016, Cambrex is obligated to manufacture PROCYSBI API for the Company through November 30, 2020. The Company must provide Cambrex with rolling, non-binding forecasts, with a portion of the forecast being the minimum floor of the firm order that must be placed. At September 30, 2017, the Company had a binding purchase commitment with Patheon for PROCYSBI of $1.4 million through January 2018 and with Cambrex for PROCYSBI API of $2.8 million through December 2020. In March 2007, Savient Pharmaceuticals, Inc. (as predecessor in interest to Crealta), entered into a commercial supply agreement with Bio-Technology General (Israel) Ltd (“BTG Israel”) for the production of the bulk KRYSTEXXA medicine (“bulk product”). The Company assumed this agreement as part of the Crealta acquisition and amended the agreement in September 2016. Under this agreement, the Company has agreed to purchase certain minimum annual order quantities and is obligated to purchase at least eighty percent of its annual world-wide bulk product requirements from BTG Israel. The term of the agreement runs until December 31, 2030, and will automatically renew for successive three year periods unless earlier terminated by either party upon three years prior written notice. The agreement may be terminated earlier by either party in the event of a force majeure, liquidation, dissolution, bankruptcy or insolvency of the other party, uncured material breach by the other party or after January 1, 2024, upon three years prior written notice. Under the agreement i f the manufacture of the is moved out of Israel, the Company may be required to obtain the approval of the Israeli Office of the Chief Scientist (“OCS”) because certain KRYSTEXXA intellectual property was initially developed with a grant funded by the OCS. Excluding the above, additional purchase orders and other commitments relating to the manufacture of BUPHENYL, MIGERGOT, QUINSAIR and RAVICTI and VIMOVO of $9.6 million were outstanding at September 30, 2017. Royalty Agreements RAYOS/LODOTRA In connection with an August 2004 development and license agreement with SkyePharma AG, who subsequently entered into a business combination with Vectura Group plc (“Vectura”), and Jagotec, a wholly owned subsidiary of Vectura, regarding certain proprietary technology and know-how owned by Vectura, Jagotec is entitled to receive a single digit percentage royalty on net sales of RAYOS/LODOTRA and on any sub-licensing income, which includes any payments not calculated based on the net sales of RAYOS/LODOTRA, such as license fees, lump sums and milestone payments. VIMOVO The Company entered into a license agreement with Pozen Inc. who subsequently entered into a business combination with Tribute Pharmaceuticals Canada Inc. to become known as Aralez Pharmaceuticals Inc. (“Aralez”). Under this agreement, the Company is required to pay Aralez a flat 10% royalty on net sales of VIMOVO and other medicines sold by the Company, its affiliates or sublicensees during the royalty term that contain gastroprotective agents in a single fixed combination oral solid dosage form with nonsteroidal anti-inflammatory drugs, subject to minimum annual royalty obligations of $7.5 million. These minimum royalty obligations will continue for each year during which one of Aralez’s patents covers such medicines in the United States and there are no competing medicines in the United States. The royalty rate may be reduced to a mid-single digit royalty rate as a result of loss of market share to competing medicines. The Company’s obligation to pay royalties to Aralez will expire upon the later of (a) expiration of the last-to-expire of certain patents covering such medicines in the United States, and (b) ten years after the first commercial sale of such medicines in the United States. In November 2013, the Company, AstraZeneca AB (“AstraZeneca”) and Aralez entered into a letter agreement. Under the letter agreement, the Company and AstraZeneca agreed to pay Aralez milestone payments upon the achievement by the Company and AstraZeneca, collectively, of certain annual aggregate global net sales thresholds ranging from $550.0 million to $1.25 billion with respect to VIMOVO. The aggregate milestone payment amount that may be owed by AstraZeneca and the Company, collectively, under the letter agreement is $260.0 million, with the amount payable by each of the Company and AstraZeneca with respect to each milestone to be based upon the proportional sales achieved by each of the Company and AstraZeneca, respectively, in the applicable year. ACTIMMUNE Under a license agreement, as amended, with Genentech Inc. (“Genentech”), who was the original developer of ACTIMMUNE, the Company is or was obligated to pay royalties to Genentech on its net sales of ACTIMMUNE as follows: • For the period from November 26, 2014 through May 5, 2018, a royalty in the 20% to 30% range for the first $3.7 million in net sales achieved in any calendar year and in the 1% to 9% range for all additional net sales in any year; and • From May 6, 2018 and for so long as the Company continues to commercially sell ACTIMMUNE, an annual royalty in the low single digits as a percentage of annual net sales. Under the terms of an assignment and option agreement with Connetics Corporation (which was the predecessor parent company to InterMune Pharmaceuticals Inc. and is now part of GlaxoSmithKline), (“Connetics”), the Company is obligated to pay low single-digit royalties to Connetics on the Company’s net sales of ACTIMMUNE in the United States. RAVICTI Under the terms of an asset purchase agreement with Ucyclyd Pharma, Inc. (“Ucyclyd”), the Company is obligated to pay to Ucyclyd tiered mid to high single-digit royalties on its global net sales of RAVICTI. Under the terms of a license agreement with Brusilow, BUPHENYL Under the terms of an amended and restated collaboration agreement with Ucyclyd, the Company is obligated to pay to Ucyclyd tiered mid to high single-digit royalties on its net sales in the United States of BUPHENYL to urea cycle disorder patients outside of the U.S. Food and Drug Administration (“FDA”) approved labeled age range for RAVICTI. KRYSTEXXA Under the terms of a license agreement with Duke and MVP, the Company is obligated to pay Duke a mid single-digit royalty on its global net sales of KRYSTEXXA and a royalty of between 5% and 15% on any global sublicense revenue. The Company is also obligated to pay MVP a mid single-digit royalty on its net sales of KRYSTEXXA outside of the United States and a royalty of between 5% and 15% on any sublicense revenue outside of the United States. PROCYSBI Under the terms of an amended and restated license agreement with UCSD, the Company is obligated to pay to UCSD tiered low to mid single-digit royalties on its net sales of PROCYSBI. The royalty obligations described above are included in accrued royalties on the Company’s condensed consolidated balance sheets. For all of the royalty agreements entered into by the Company, a total expense of $15.0 million and $42.1 million was recorded during the three and nine months ended September 30, 2017, respectively, of which $14.9 million and $42.0 million was recorded in cost of goods sold, respectively, and $0.1 million and $0.1 million was recorded in selling, general and administrative expenses, respectively, in the condensed consolidated statements of comprehensive loss. During the three and nine months ended September 30, 2016, $11.2 million and $32.6 million was recorded in cost of goods sold, respectively, in the condensed consolidated statements of comprehensive loss. Other Agreements On November 8, 2016, the Company entered into a collaboration and option agreement with a privately held life-science entity. Under the terms of the agreement, the privately held life-science entity will conduct certain research and pre-clinical and clinical development activities. Upon execution of the agreement, the Company paid $0.1 million for the option to acquire certain of the privately held life-science entity’s assets for $25.0 million, which is exercisable on specified key dates. Under the collaboration and option agreement, the Company is required to pay up to $9.8 million upon the attainment of various milestones, primarily to fund clinical development costs for the medicine candidate. The Company paid $0.2 million in the fourth quarter of 2016, $0.9 million during the first quarter of 2017 and $1.5 million in the third quarter of 2017 related to milestones. On May 8, 2017, the Company acquired River Vision for upfront cash payments totaling $151.9 million, including $6.3 million of cash acquired, and subject to other customary purchase price adjustments for working capital, and potential future milestone and royalty payments contingent on the satisfaction of certain regulatory milestones and sales thresholds. Under the agreement, the Company is required to pay up to $325.0 million upon the attainment of various milestones related to FDA approval and net sales thresholds. The agreement also includes a royalty payment of three percent of the portion of annual worldwide net sales exceeding $300.0 million (if any). Under a separate agreement, the Company is also required to pay up to CHF103.0 million upon the attainment of various milestones related to approval, filing and net sales thresholds. The agreement also includes a royalty payment of between nine percent and twelve percent of the portion of annual worldwide net sales. Contingencies The Company is subject to claims and assessments from time to time in the ordinary course of business. The Company’s management does not believe that any such matters, individually or in the aggregate, will have a material adverse effect on the Company’s business, financial condition, results of operations or cash flows. In addition, the Company from time to time has billing disputes with vendors in which amounts invoiced are not in accordance with the terms of their contracts. In November 2015, the Company received a subpoena from the U.S. Attorney’s Office for the Southern District of New York requesting documents and information related to its patient access programs and other aspects of its marketing and commercialization activities. The Company is unable to predict how long this investigation will continue or its outcome, but it anticipates that it will continue to incur significant costs in connection with the investigation, regardless of the outcome. The Company may also become subject to similar investigations by other governmental agencies. The investigation by the U.S. Attorney’s Office and any additional investigations of the Company’s patient access programs and sales and marketing activities may result in damages, fines, penalties or other administrative sanctions against the Company. Indemnification In the normal course of business, the Company enters into contracts and agreements that contain a variety of representations and warranties and provide for general indemnifications. The Company’s exposure under these agreements is unknown because it involves claims that may be made against the Company in the future, but have not yet been made. In connection with the federal securities class action litigation (described in Note 17 below), the Company has received notice from the Underwriter Defendants (as defined below) of their intention to seek indemnification and has received and paid several invoices from the Underwriter Defendants. The Company may record charges in the future as a result of these indemnification obligations. In accordance with its memorandum and articles of association, the Company has indemnification obligations to its officers and directors for certain events or occurrences, subject to certain limits, while they are serving at the Company’s request in such capacity. Additionally, the Company has entered into, and intends to continue to enter into, separate indemnification agreements with its directors and executive officers. These agreements, among other things, require the Company to indemnify its directors and executive officers for certain expenses, including attorneys’ fees, judgments, fines and settlement amounts incurred by a director or executive officer in any action or proceeding arising out of their services as one of the Company’s directors or executive officers, or any of the Company’s subsidiaries or any other company or enterprise to which the person provides services at the Company’s request. In connection with the federal securities class action litigation (described in Note 17 below), the Company has paid legal fees and costs on behalf of itself and the current and former officers and directors of the Company who are named as defendants in that litigation. The Company also has a director and officer insurance policy that enables it to recover a portion of any amounts paid for current and future potential claims. All of the Company’s officers and directors have also entered into separate indemnification agreements with Horizon Pharma, Inc. (“HPI”). |
Legal Proceedings
Legal Proceedings | 9 Months Ended |
Sep. 30, 2017 | |
Commitments And Contingencies Disclosure [Abstract] | |
Legal Proceedings | NOTE 17 - LEGAL PROCEEDINGS RAYOS On July 15, 2013, the Company received a Paragraph IV Patent Certification from Watson Laboratories, Inc.—Florida, known as Actavis Laboratories FL, Inc. (“Actavis FL”), advising that Actavis FL had filed an Abbreviated New Drug Application (“ANDA”) with the FDA for a generic version of RAYOS, containing up to 5 mg of prednisone. On August 26, 2013, the Company, together with Jagotec, filed suit in the United States District Court for the District of New Jersey against Actavis FL, Actavis Pharma, Inc., Andrx Corp., and Actavis, Inc. seeking an injunction to prevent the approval of the ANDA. On October 1, 2015, the Company’s subsidiary Horizon Pharma Switzerland GmbH, as well as Jagotec, entered into a license and settlement agreement (the “Actavis settlement agreement”) with Actavis FL relating to the Company’s and Jagotec’s patent infringement litigation against Actavis FL. The court entered the stipulation of dismissal and closed the case on December 4, 2015. The Actavis settlement agreement provides for a full settlement and release by each party of all claims that relate to the litigation or under the patents with respect to Actavis FL’s generic version of RAYOS tablets. Under the Actavis settlement agreement, the Company and Jagotec granted Actavis FL a non-exclusive license to manufacture and commercialize Actavis FL’s generic version of RAYOS tablets in the United States after the generic entry date (as defined below) and to take steps necessary to develop inventory of, and prepare to commercialize, Actavis FL’s generic version of RAYOS tablets during certain limited periods prior to the generic entry date. The Company and Jagotec also agreed that during the 180 days after the generic entry date, the license granted to Actavis FL would be exclusive with respect to any third-party generic version of RAYOS tablets. Under the Actavis settlement agreement, the generic entry date is December 23, 2022; however, Actavis FL may be able to enter the market earlier under certain circumstances. Such events relate to the resolution of any other third-party RAYOS patent litigation, the entry of other generic versions of RAYOS tablets or certain substantial reductions in RAYOS prescriptions over specified periods of time. PENNSAID 2% On November 13, 2014, the Company received a Paragraph IV Patent Certification from Watson Laboratories, Inc. (“Watson Laboratories”) advising that Watson Laboratories had filed an ANDA with the FDA for a generic version of PENNSAID 2%. On December 23, 2014, the Company filed suit in the United States District Court for the District of New Jersey against Actavis Laboratories UT, Inc., and Actavis plc (collectively “Actavis”) seeking an injunction to prevent the approval of the ANDA. Since then, Watson Laboratories, Inc. changed its name to Actavis Laboratories UT, Inc., and is the current owner of the ANDA. The lawsuit alleged that Actavis has infringed U.S. Patents 8,217,078, 8,252,838, 8,546,450, 8,563,613, 8,618,164, and 8,871,809 by filing an ANDA seeking approval from the FDA to market a generic version of PENNSAID 2% prior to the expiration of certain of the Company’s patents listed in the FDA’s Orange Book (“Orange Book”). On June 30, 2015, the Company filed suit in the United States District Court for the District of New Jersey against Actavis for patent infringement of U.S. Patent 9,066,913. On August 11, 2015, the Company filed suit in the United States District Court for the District of New Jersey against Actavis for patent infringement of U.S. Patent 9,101,591. On September 17, 2015, the Company filed suit in the United States District Court for the District of New Jersey against Actavis for patent infringement of U.S. Patent 9,132,110. All three patents, U.S. Patents 9,066,913, 9,101,591 and 9,132,110 are listed in the Orange Book and have claims that cover PENNSAID 2%. These three cases were consolidated with the case filed against Actavis on December 23, 2014. On August 17, 2016, the district court issued a Markman opinion holding certain of the asserted claims of U.S. Patents 8,252,838, 8,563,613, 9,066,913 and 9,101,591 invalid as indefinite. On March 16, 2017, the court granted Actavis’ motion for summary judgment of non-infringement of the asserted claims of U.S. Patents 8,546,450, 8,217,078 and 9,132,110. In view of the Markman On October 27, 2015, the Company filed suit in the United States District Court for the District of New Jersey against Actavis for patent infringement of U.S. Patents 9,168,304 and 9,168,305. On February 5, 2016, the Company filed suit in the United States District Court for the District of New Jersey against Actavis for patent infringement of U.S. Patent No. 9,220,784. All three patents, U.S. Patent Nos. 9,168,304, 9,168,305, and 9,220,784, are listed in the Orange Book and have claims that cover PENNSAID 2%. All claims from U.S. Patents 9,168,304, 9,168,305 and 9,220,784 asserted against Actavis were held invalid as indefinite by way of the court’s August 17, 2016 Markman opinion. The court’s rulings are currently on appeal to the Federal Circuit. On August 18, 2016, the Company filed suit in the United States District Court for the District of New Jersey against Actavis for patent infringement of U.S. Patents 9,339,551, 9,339,552, 9,370,501 and 9,375,412. All four patents, U.S. Patents 9,339,551, 9,339,552, 9,370,501 and 9,375,412, are listed in the Orange Book and have claims that cover PENNSAID 2%. The Company received from Actavis a Paragraph IV Patent Certification Notice Letter dated September 27, 2016, against Orange Book listed U.S. Patent No. 9,415,029, advising that Actavis had filed an ANDA with the FDA for a generic version of PENNSAID 2%. On December 2, 2014, the Company received a Paragraph IV Patent Certification against Orange Book listed U.S. Patents. 8,217,078, 8,252,838, 8,546,450, 8,563,613, 8,618,164 and 8,741,956 from Paddock Laboratories, LLC (“Paddock”) advising that Paddock had filed an ANDA with the FDA for a generic version of PENNSAID 2%. On January 9, 2015, the Company received from Paddock another Paragraph IV Patent Certification against newly Orange Book listed U.S. Patent No. 8,871,809. On January 13, 2015 and January 14, 2015, the Company filed suits in the United States District Court for the District of New Jersey and the United States District Court for the District of Delaware, respectively, against Paddock seeking an injunction to prevent the approval of the ANDA. The lawsuits alleged that Paddock has infringed U.S. Patents 8,217,078, 8,252,838, 8,546,450, 8,563,613, 8,618,164 and 8,871,809 by filing an ANDA seeking approval from the FDA to market generic versions of PENNSAID 2% prior to the expiration of certain of the Company’s patents listed in the Orange Book. On May 6, 2015, the Company entered into a settlement and license agreement (the “Perrigo settlement agreement”) with Perrigo Company plc and its subsidiary Paddock (collectively, “Perrigo”), relating to the Company’s patent infringement litigation against Perrigo. The Perrigo settlement agreement provides for a full settlement and release by both the Company and Perrigo of all claims that were or could have been asserted in the litigation and that arise out of the issues that were the subject of the litigation or Perrigo’s generic version of PENNSAID 2%. A stipulation of dismissal was entered by the district court on May 13, 2015. Under the Perrigo settlement agreement, the license effective date is January 10, 2029; however, Perrigo may be able to enter the market earlier under certain circumstances. Such events relate to the resolution of any other third-party PENNSAID 2% patent litigation, the entry of other third-party generic versions of PENNSAID 2% or certain substantial reductions in the Company’s PENNSAID 2% shipments over specified periods of time. Under the Perrigo settlement agreement, the Company also agreed not to sue or assert any claim against Perrigo for infringement of any patent or patent application owned or controlled by the Company during the term of the license granted in the Perrigo settlement agreement based on the manufacture, use, sale, offer for sale, or importation of Perrigo’s generic version of PENNSAID 2% in the United States. In certain circumstances following the entry of other third-party generic versions of PENNSAID 2%, the Company may be required to supply Perrigo PENNSAID 2% as its authorized distributor of generic PENNSAID 2%, with the Company receiving specified percentages of any net sales by Perrigo. On February 2, 2015, the Company received a Paragraph IV Patent Certification against Orange Book listed U.S. Patents 8,217,078, 8,252,838, 8,546,450, 8,563,613, 8,618,164, 8,741,956 and 8,871,809 from Taro Pharmaceuticals USA, Inc. and Taro Pharmaceutical Industries, Ltd. (collectively, “Taro”) advising that Taro had filed an ANDA with the FDA for a generic version of PENNSAID 2%. On March 13, 2015, the Company filed suit in the United States District Court for the District of New Jersey against Taro seeking an injunction to prevent the approval of the ANDA. On September 9, 2015, certain subsidiaries of the Company (the “Horizon Subsidiaries”) entered into a settlement and license agreement with Taro (the “Taro settlement agreement”) relating to the Horizon Subsidiaries’ patent infringement litigation against Taro. The Taro settlement agreement provides for a full settlement and release by the Horizon Subsidiaries and Taro of all claims that were or could have been asserted in the litigation and that arise out of the issues that were subject of the litigation or Taro’s generic version of PENNSAID 2%. A stipulation of dismissal was entered by the district court on November 3, 2015. Under the Taro settlement agreement, the Horizon Subsidiaries granted Taro a non-exclusive license to manufacture and commercialize Taro’s generic version of PENNSAID 2% in the United States after the license effective date (as defined below) and to take steps necessary to develop inventory of, and prepare to commercialize, Taro’s generic version of PENNSAID 2% during certain limited periods prior to the license effective date. Under the Taro settlement agreement, the license effective date is January 10, 2029; however, Taro may be able to enter the market earlier under certain circumstances. Such events relate to the resolution of any other third-party PENNSAID 2% patent litigation, the entry of other third-party generic versions of PENNSAID 2% or certain substantial reductions in the Company’s PENNSAID 2% shipments over specified periods of time. On March 18, 2015, the Company received a Paragraph IV Patent Certification against Orange Book listed U.S. Patents 8,217,078, 8,252,838, 8,546,450, 8,563,613, 8,618,164, 8,741,956 and 8,871,809 from Lupin Limited advising that Lupin Limited had filed an ANDA with the FDA for generic version of PENNSAID 2%. On April 30, 2015, the Company filed suit in the United States District Court for the District of New Jersey against Lupin Limited and Lupin Pharmaceuticals Inc. (collectively, “Lupin”), seeking an injunction to prevent the approval of the ANDA. The lawsuit alleges that Lupin has infringed U.S. Patents 8,217,078, 8,252,838, 8,546,450, 8,563,613, 8,618,164 and 8,871,809 by filing an ANDA seeking approval from the FDA to market generic versions of PENNSAID 2% prior to the expiration of certain of the Company’s patents listed in the Orange Book. The commencement of the patent infringement lawsuit stays, or bars, FDA approval of Lupin’s ANDA for 30 months or until an earlier district court decision which finds that the subject patents are not infringed or are invalid. On June 30, 2015, the Company filed suit in the United States District Court for the District of New Jersey against Lupin for patent infringement of U.S. Patent No. 9,066,913. On August 11, 2015, the Company filed an amended complaint in the United States District Court for the District of New Jersey against Lupin that added U.S. Patent No. 9,101,591 to the litigation concerning U.S. Patent 9,066,913. On September 17, 2015, the Company filed suit in the United States District Court for the District of New Jersey against Lupin for patent infringement of U.S. Patent 9,132,110. All three patents, U.S. Patents 9,066,913, 9,101,591 and 9,132,110 are listed in the Orange Book and have claims that cover PENNSAID 2%. On October 27, 2015, the Company filed suit in the United States District Court for the District of New Jersey against Lupin for patent infringement of U.S. Patents 9,168,304 and 9,168,305. On February 5, 2016, the Company filed suit in the United States District Court for the District of New Jersey against Lupin for patent infringement of U.S. Patent No. 9,220,784. On August 18, 2016, the Company filed suit in the United States District Court for the District of New Jersey against Lupin for patent infringement of U.S. Patents 9,339,551, 9,339,552, 9,370,501 and 9,375,412. All seven patents, U.S. Patents 9,168,304, 9,168,305, 9,220,784, 9,339,551, 9,339,552, 9,370,501 and 9,375,412, are listed in the Orange Book and have claims that cover PENNSAID 2%. All of the infringement actions brought against Lupin remain pending, with certain claims of the ’809, ’913, ’450, ’110, ’551, ’552, ’412 and ’501 patents being asserted. The decisions reached by the court in the related Actavis actions regarding the ‘809, ‘913, ‘450, ‘110, ‘551, ‘552, ‘412 and ‘501 patents as described above, are expected to apply to the same claims asserted against Lupin in these actions. The court has not yet set a trial date for the Lupin actions. The Company received from Teligent, Inc., formerly known as IGI Laboratories, Inc. (“Teligent”), a Paragraph IV Patent Certification dated March 24, 2015 against Orange Book listed U.S. Patents 8,217,078, 8,252,838, 8,546,450, 8,563,613, 8,618,164, 8,741,956 and 8,871,809 advising that Teligent had filed an ANDA with the FDA for a generic version of PENNSAID 2%. On May 21, 2015, the Company filed suit in the United States District Court for the District of New Jersey against Teligent seeking an injunction to prevent the approval of the ANDA. The lawsuit alleged that Teligent has infringed U.S. Patents 8,217,078, 8,252,838, 8,546,450, 8,563,613, 8,618,164 and 8,871,809 by filing an ANDA seeking approval from the FDA to market generic versions of PENNSAID 2% prior to the expiration of certain of the Company’s patents listed in the Orange Book. On June 30, 2015, the Company filed suit in the United States District Court for the District of New Jersey against Teligent for patent infringement of U.S. Patent 9,066,913. On August 11, 2015, the Company filed suit in the United States District Court for the District of New Jersey against Teligent for patent infringement of U.S. Patent 9,101,591. On September 17, 2015, the Company filed suit in the United States District Court for the District of New Jersey against Teligent for patent infringement of U.S. Patent No. 9,132,110. All three patents, U.S. Patents 9,066,913, 9,101,591 and 9,132,110 are listed in the Orange Book and have claims that cover PENNSAID 2%. On October 27, 2015, the Company filed suit in the United States District Court for the District of New Jersey against Teligent for patent infringement of U.S. Patents 9,168,304 and 9,168,305. On February 5, 2016, the Company filed suit in the United States District Court for the District of New Jersey against Teligent for patent infringement of U.S. Patent 9,220,784. All three patents, U.S. Patents 9,168,304, 9,168,305 and 9,220,784 are listed in the Orange Book and have claims that cover PENNSAID 2%. The Company entered into a settlement and license agreement with Teligent (the “Teligent settlement agreement”), effective May 9, 2016, relating to the patent infringement litigation against Teligent. The Teligent settlement agreement provides for a full settlement and release by both the Company and Teligent of all claims that were or could have been asserted in the litigation and that arise out of the issues that were subject of the litigation or Teligent’s generic version of PENNSAID 2%. A stipulation of dismissal was entered by the district court on May 2, 2016. Under the Teligent settlement agreement, the Company granted Teligent a non-exclusive license to manufacture and commercialize Teligent’s generic version of PENNSAID 2% in the United States after the license effective date (as defined below) and to take steps necessary to develop inventory of, and prepare to commercialize, Teligent’s generic version of PENNSAID 2% during certain limited periods prior to the license effective date. Under the Teligent settlement agreement, the license effective date is January 10, 2029; however, Teligent may be able to enter the market earlier under certain circumstances. Such events relate to the resolution of any other third-party PENNSAID 2% patent litigation, the entry of other third-party generic versions of PENNSAID 2% or certain substantial reductions in the Company’s PENNSAID 2% shipments over specified periods of time. In certain circumstances following the entry of other third-party generic versions of PENNSAID 2%, the Company may be required to supply Teligent PENNSAID 2% as an authorized distributor of generic PENNSAID 2%, with the Company receiving specified percentages of any net sales by Teligent. The Company received from Amneal Pharmaceuticals LLC (“Amneal”) a Paragraph IV Patent Certification dated April 2, 2015 against Orange Book listed U.S. Patents 8,217,078, 8,252,838, 8,546,450, 8,563,613, 8,618,164, 8,741,956 and 8,871,809 advising that Amneal had filed an ANDA with the FDA for a generic version of PENNSAID 2%. On May 15, 2015, the Company filed suit in the United States District Court for the District of New Jersey against Amneal seeking an injunction to prevent the approval of the ANDA. The lawsuit alleged that Amneal has infringed U.S. Patents 8,217,078, 8,252,838, 8,546,450, 8,563,613, 8,618,164 and 8,871,809 by filing an ANDA seeking approval from the FDA to market generic versions of PENNSAID 2% prior to the expiration of certain of the Company’s patents listed in the Orange Book. On June 30, 2015, the Company filed suit in the United States District Court for the District of New Jersey against Amneal for patent infringement of U.S. Patent 9,066,913. On August 11, 2015, the Company filed suit in the United States District Court for the District of New Jersey against Amneal for patent infringement of U.S. Patent 9,101,591. On September 17, 2015, the Company filed suit in the United States District Court for the District of New Jersey against Amneal for patent infringement of U.S. Patent 9,132,110. All three patents, U.S. Patents 9,066,913, 9,101,591 and 9,132,110, are listed in the Orange Book and have claims that cover PENNSAID 2%. On October 27, 2015, the Company filed suit in the United States District Court for the District of New Jersey against Amneal for patent infringement of U.S. Patents 9,168,304 and 9,168,305. On February 5, 2016, the Company filed suit in the United States District Court for the District of New Jersey against Amneal for patent infringement of U.S. Patent 9,220,784. All three patents, U.S. Patents 9,168,304, 9,168,305, and 9,220,784, are listed in the Orange Book and have claims that cover PENNSAID 2%. On April 18, 2016, the Company entered into a settlement and license agreement (the “Amneal settlement agreement”) with Amneal relating to the Company’s patent infringement litigation against Amneal. The Amneal settlement agreement provides for a full settlement and release by both the Company and Amneal of all claims that were or could have been asserted in the litigation and that arise out of the issues that were the subject of the litigation or Amneal’s generic version of PENNSAID 2%. A stipulation of dismissal was entered by the district court. Under the Amneal settlement agreement, the Company granted Amneal a non-exclusive license to manufacture and commercialize Amneal’s generic version of PENNSAID 2% in the United States after the license effective date (as defined below) and to take steps necessary to develop inventory of, and prepare to commercialize, Amneal’s generic version of PENNSAID 2% during certain limited periods prior to the license effective date. Under the Amneal settlement agreement, the license effective date is January 10, 2029; however, Amneal may be able to enter the market earlier under certain circumstances. Such events relate to the resolution of any other third-party PENNSAID 2% patent litigation or the entry of other third-party generic versions of PENNSAID 2%. In certain circumstances following the entry of other third-party generic versions of PENNSAID 2%, the Company may be required to supply Amneal with PENNSAID 2% as a non-exclusive, authorized distributor of generic PENNSAID 2%, with the Company receiving specified percentages of any net sales by Amneal. The Company received from Apotex Inc. (“Apotex”) a Paragraph IV Patent Certification Notice Letter dated April 1, 2016, against Orange Book listed U.S. Patents 8,217,078, 8,252,838, 8,546,450, 8,563,613, 8,618,164, 8,741,956, 8,871,809, 9,066,913, 9,101,591, 9,132,110, 9,168,304, 9,168,305 and 9,220,784 advising that Apotex had filed an ANDA with the FDA for a generic version of PENNSAID 2%. The Company also received from Apotex a second Paragraph IV Patent Certification Notice Letter dated June 30, 2016, against Orange Book listed U.S. Patents 9,339,551 and 9,339,552, advising that Apotex had filed an ANDA with the FDA for a generic version of PENNSAID 2%. The Company also received from Apotex a third Paragraph IV Patent Certification Notice Letter dated September 21, 2016, against Orange Book listed U.S. Patent 9,415,029, advising that Apotex had filed an ANDA with the FDA for a generic version of PENNSAID 2%. The Company also received from Apotex additional Paragraph IV Patent Certification Notice Letters dated April 20, 2017 and April 27, 2017 against Orange Book listed U.S. Patent 9,539,335 and 9,370,501. VIMOVO Currently, patent litigation is pending in the United States District Court for the District of New Jersey and the Court of Appeals for the Federal Circuit against three generic companies intending to market VIMOVO prior to the expiration of certain of the Company’s patents listed in the Orange Book. These cases are in the United States District Court for the District of New Jersey. They are collectively known as the VIMOVO cases, and involve the following sets of defendants: (i) Dr. Reddy’s Laboratories Inc. and Dr. Reddy’s Laboratories Ltd. (collectively, “Dr. Reddy’s”); (ii) Lupin Ltd. and Lupin Pharmaceuticals Inc. (collectively, “Lupin”); and (iii) Mylan Pharmaceuticals Inc., Mylan Laboratories Limited, and Mylan Inc. (collectively, “Mylan”). Patent litigation in the United States District Court for the District of New Jersey against a fourth generic company, Actavis Laboratories FL., Inc. and Actavis Pharma, Inc. (collectively, “Actavis Pharma”), was dismissed on January 10, 2017 after the court granted Actavis’ motion to compel enforcement of a settlement agreement. On February 3, 2017, the Company appealed this dismissal decision to the Court of Appeals for the Federal Circuit. Patent litigation in the United States District Court for the District of New Jersey against a fifth generic company, Anchen Pharmaceuticals Inc. (“Anchen”), was dismissed on June 9, 2014 after Anchen recertified under Paragraph III. The Company understands that Dr. Reddy’s has entered into a settlement with AstraZeneca with respect to patent rights directed to Nexium for the commercialization of VIMOVO. The settlement agreement, however, has no effect on the Aralez VIMOVO patents, which are still the subject of patent litigations. As part of the Company’s acquisition of the U.S. rights to VIMOVO, the Company has taken over and is responsible for the patent litigation that includes the Aralez patents licensed to the Company under the amended and restated collaboration and license agreement for the United States with Aralez. The VIMOVO cases were filed on April 21, 2011, July 25, 2011, October 28, 2011, January 4, 2013, May 10, 2013, June 28, 2013, October 23, 2013, May 13, 2015 and November 24, 2015 and collectively include allegations of infringement of U.S. Patent Nos. 6,926,907, 8,557,285, 8,852,636, and 8,858,996 (the “’996 patent”). On June 18, 2015, the Company amended the complaints to add a charge of infringement of U.S. Patent No. 8,865,190 (the “’190 patent”). On January 7, 2016, Actavis Pharma asserted a counterclaim for declaratory judgment of invalidity and non-infringement of U.S. Patent No. 8,945,621 (the “’621 patent”). On January 25, 2016, the Company filed a new case against Actavis Pharma including allegations of infringement of U.S. Patent Nos. 9,161,920 and 9,198,888. This case was subsequently consolidated with the Actavis Pharma case involving the ’996 patent, the ’190 patent and U.S. Patent No. 8,852,636. On February 10, 2016, the Company amended the complaints against Dr. Reddy’s, Lupin, and Mylan to add charges of infringement of U.S. Patent Nos. 9,161,920 and 9,198,888. On February 19, 2016, Mylan asserted a counterclaim for declaratory judgment of invalidity and non-infringement of U.S. Patent No. 9,220,698. On August 11, 2016, the Company filed new complaints asserting the ’621 patent and U.S. Patent Nos. 9,220,698, and 9,345,695 against the defendants. On December 6, 2016, the Company asserted U.S. Patent No. 9,393,208 (the “’208 patent”) against Lupin, Mylan, and Actavis in amended complaints, and against Dr. Reddy’s in a new complaint. “Case I” consists of the cases asserting U.S. Patent Nos. 8,557,285 and 6,926,907. “Case II” consists of the cases asserting the ’996 patent, the ’190 patent and U.S. Patent Nos. 8,852,636, 9,161,920, and 9,198,888. “Case III” consists of the cases asserting U.S. Patent Nos. 8,945,621, 9,220,698, 9,345,695, and the ’208 patent against Lupin and Mylan, and the case asserting U.S. Patent Nos. 8,945,621, 9,220,698, and 9,345,695 against Dr. Reddy’s. “Case IV” consisted of the case asserting the ’208 patent against Dr. Reddy’s, but has been consolidated with Case III. The Case I cases were consolidated for discovery. The court issued a claim construction order for Case I and conducted trial beginning on January 12, 2017. On May 12, 2016, the court granted Dr. Reddy’s motion for summary judgment of non-infringement of U.S. Patent No. 6,926,907 with respect to one of Dr. Reddy’s two ANDAs. On December 19, 2016, defendant Actavis filed a motion to compel enforcement of settlement agreement related to Cases I, II, and III. On December 22, 2016, Magistrate Judge Arpert entered a report and recommendation that Actavis’ motion to compel the enforcement of settlement be granted. On December 30, 2016, the Honorable Judge Mary Cooper ordered the adoption of the report and recommendation. On January 10, 2017, an order of dismissal was entered for all claims in Cases I, II and III. The Company appealed the district court’s order enforcing the settlement with Actavis to the Court of Appeals for the Federal Circuit. Briefing before the Federal Circuit has been completed. On January 12, 2017, a six-day bench trial commenced against defendants Dr. Reddy’s and Mylan before Honorable Judge Mary Cooper in the District of New Jersey for Case I. The patents at issue in this trial included two Orange Book listed patents: U.S. Patent Nos. 6,926,907 and 8,557,285. Defendant Lupin formerly entered into a stay pending the entry of judgment in Case I. On June 26, 2017, the court issued its opinion upholding the validity of the ‘285 and ‘907 patents and finding that Dr. Reddy’s, Mylan’s, and Lupin’s proposed generic naproxen/esomeprazole magnesium products would all infringe at least one of the two patents. The court entered the final judgment on July 21, 2017. Dr. Reddy’s, Mylan and Lupin have appealed the District Court’s judgment to the Court of Appeals for the Federal Circuit. The Case II and Case III cases have been consolidated for discovery. On January 19, 2017, the court entered a scheduling order for Case II and Case III, which was subsequently updated. The court’s scheduling order requires, inter alia The Company understands the cases arise from Paragraph IV Patent Certification notice letters providing notice of the filing of ANDAs with the FDA seeking regulatory approval to market generic versions of VIMOVO before the expiration of the patents-in-suit. The Company understands the Dr. Reddy’s notice letters were dated March 11, 2011, November 20, 2012 and April 20, 2015; the Lupin notice letters were dated June 10, 2011, March 12, 2014 and July 26, 2016; the Mylan notice letters were dated May 16, 2013, February 9, 2015, January 26, 2016, February 26, 2016, July 19, 2016 and September 22, 2016; the Actavis Pharma notice letters were dated March 29, 2013, November 5, 2013, May 29, 2015, October 9, 2015, December 10, 2015, March 1, 2016, April 6, 2016, July 22, 2016 and September 8, 2016; and the Anchen notice letter was dated September 16, 2011. On June 5, 2015, the Coalition for Affordable Drugs VII LLC (“Coalition for Affordable Drugs”) filed a Petition for inter partes review (“IPR”) of the ’996 patent, one of the patents in litigation in the above referenced VIMOVO cases. On December 17, 2015, the United States Patent and Trademark Office (the “U.S. PTO”) denied such Petition for IPR. On August 7, 2015, the Coalition for Affordable Drugs filed another Petition for IPR of U.S. Patent No. 8,852,636, one of the patents in litigation in the above referenced VIMOVO cases. On February 11, 2016, the U.S. PTO denied such Petition for IPR. On August 12, 2015, the Coalition for Affordable Drugs filed another Petition for IPR of the ’621 patent, one of the patents in litigation in the above referenced VIMOVO cases. On February 22, 2016, the Patent Trial and Appeal Board (the “PTAB”) issued a decision to institute the IPR. The PTAB hearing for the ‘621 patent was held on November 16, 2016. The PTAB issued a final written decision finding the ’621 patent valid on February 21, 2017. On August 19, 2015, Lupin filed Petitions for IPR of the ’996 patent, the ’190 patent and U.S. Patent No. 8,852,636, all patents in litigation in the above referenced VIMOVO cases. On March 1, 2016, the PTAB issued decisions to institute the IPRs for the ’996 patent” and the ’190 patent. On March 1, 2016, the PTAB denied the Petition for IPR for U.S. Patent No. 8,852,636. The PTAB hearings for the ‘996 patent and ‘190 patent were both held on November 29, 2016. On February 28, 2017, the PTAB issued final written decisions on the IPRs of the ‘996 and ‘190 patents, upholding the validity of both patents. RAVICTI On March 17, 2014, Hyperion Therapeutics, Inc. (“Hyperion”) received notice from Par Pharmaceutical, Inc. (“Par Pharmaceutical”) that it had filed an ANDA with the FDA seeking approval for a generic version of the Company’s medicine RAVICTI. The ANDA contained a Paragraph IV Patent Certification alleging that two of the patents covering RAVICTI, U.S. Patent No. 8,404,215, titled “Methods of therapeutic monitoring of nitrogen scavenging drugs,” which expires in March 2032 (the “’215 patent”), and U.S. Patent No. 8,642,012, titled “Methods of treatment using ammonia scavenging drugs,” which expires in September 2030 (the “’012 patent”), are invalid and/or will not be infringed by Par Pharmaceutical’s manufacture, use or sale of the medicine for which the ANDA was submitted. Par Pharmaceutical did not challenge the validity, enforceability, or infringement of the Company’s primary composition of matter patent for RAVICTI, U.S. Patent No. 5,968,979 titled “Triglycerides and ethyl esters of phenylalkanoic acid and phenylalkanoic acid useful in treatment of various disorders,” which would have expired on February 7, 2015, but as to which Hyperion was granted an interim term of extension until February 7, 2016 and to which the U.S. PTO has granted a final term extension of 1,267 days, which extends the expiration date to July 28, 2018. Hyperion filed suit in the United States District Court for the Eastern District of Texas, Marshall Division, against Par Pharmaceutical on April 23, 2014 seeking an injunction to prevent the approval of Par Pharmaceutical’s ANDA and/or to prevent Par Pharmaceutical from selling a generic version of RAVICTI, and the Company has taken over and is responsible for this patent litigation. On September 15, 2015, the Company received not |
Shareholders' Equity
Shareholders' Equity | 9 Months Ended |
Sep. 30, 2017 | |
Equity [Abstract] | |
Shareholders' Equity | NOTE 18 – SHAREHOLDERS’ EQUITY During the nine months ended September 30, 2017, the Company issued an aggregate of: • 270,427 ordinary shares in connection with the exercise of stock options and received $1.8 million in proceeds; • 660,092 ordinary shares in net settlement of vested restricted stock units; • 25,000 ordinary shares in net settlement of vested performance stock units; and • 462,472 ordinary shares pursuant to employee stock purchase plans and received $3.9 million in proceeds. During the nine months ended September 30, 2017, warrants to purchase an aggregate of 391,500 ordinary shares of the Company were exercised and proceeds of $1.8 million were received. In addition, warrants to purchase an aggregate of 704,285 ordinary shares of the Company were exercised in cashless exercises, resulting in the issuance of 523,520 ordinary shares. As of September 30, 2017, there were no outstanding warrants to purchase ordinary shares of the Company. During the nine months ended September 30, 2017 5.6 On January 1, 2017, the Company adopted ASU No. 2016-09. As a result of the adoption, $7.2 million of excess tax benefits that had not previously been recognized, as the related tax deduction had not reduced current taxes payable, were recorded on a modified retrospective basis through a cumulative effect adjustment to its accumulated deficit as of January 1, 2017. In May 2016, the Company’s board of directors authorized a share repurchase program pursuant to which the Company may repurchase up to 5,000,000 of its ordinary shares. In May 2017, the Company’s board of directors reauthorized a share repurchase program pursuant to which the Company may repurchase up to 16,000,000 of its ordinary shares. As of September 30, 2017, the Company had repurchased 100,000 of its ordinary shares under this repurchase program, for total consideration of $1.0 million. The timing and amount of future repurchases, if any, will depend on a variety of factors, including the price of the Company’s ordinary shares, alternative investment opportunities, the Company’s cash resources, restrictions under the Credit Agreement and market conditions. |
Share-Based Incentive Plans
Share-Based Incentive Plans | 9 Months Ended |
Sep. 30, 2017 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Share-Based Incentive Plans | NOTE 19 – SHARE-BASED INCENTIVE PLANS Employee Stock Purchase Plan 2014 Employee Stock Purchase Plan . On May 17, 2014, HPI’s board of directors adopted the 2014 Employee Stock Purchase Plan (the “2014 ESPP”). On September 18, 2014, at a special meeting of the stockholders of HPI (the “Special Meeting”), HPI’s stockholders approved the 2014 ESPP. Upon consummation of the Company’s merger transaction with Vidara (the “Vidara Merger”), the Company assumed the 2014 ESPP. As described below, effective as of May 3, 2016, the number of ordinary shares authorized for issuance under the 2014 ESPP was reduced by 5,000,000 shares. As of September 30, 2017, an aggregate of 3,361,928 ordinary shares were authorized and available for future issuance under the 2014 ESPP. Share-Based Compensation Plans 2005 Stock Plan . In October 2005, HPI adopted the 2005 Stock Plan (the “2005 Plan”). Upon the signing of the underwriting agreement related to HPI’s initial public offering, on July 28, 2011, no further option grants were made under the 2005 Plan. All stock awards granted under the 2005 Plan prior to July 28, 2011 continue to be governed by the terms of the 2005 Plan. Upon consummation of the Vidara Merger, the Company assumed the 2005 Plan. 2011 Equity Incentive Plan . In July 2010, HPI’s board of directors adopted the 2011 Equity Incentive Plan (the “2011 EIP”). In June 2011, HPI’s stockholders approved the 2011 EIP, and it became effective upon the signing of the underwriting agreement related to HPI’s initial public offering on July 28, 2011. Upon consummation of the Vidara Merger, the Company assumed the 2011 EIP, and upon the effectiveness of the Horizon Pharma Public Limited Company 2014 Equity Incentive Plan (the “2014 EIP”), no additional stock awards were or will be made under the 2011 Plan, although all outstanding stock awards granted under the 2011 Plan continue to be governed by the terms of the 2011 Plan. 2014 Equity Incentive Plan and 2014 Non-Employee Equity Plan . On May 17, 2014, HPI’s board of directors adopted the 2014 EIP and the Horizon Pharma Public Limited Company 2014 Non-Employee Equity Plan (the “2014 Non-Employee Equity Plan”). At the Special Meeting, HPI’s stockholders approved the 2014 EIP and 2014 Non-Employee Equity Plan. Upon consummation of the Vidara Merger, the Company assumed the 2014 EIP and 2014 Non-Employee Equity Plan, which serve as successors to the 2011 EIP. The 2014 EIP provides for the grant of incentive and nonstatutory stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance awards and other stock awards that may be settled in cash, shares or other property to the employees of the Company (or a subsidiary company). The number of ordinary shares of the Company that were initially authorized for issuance under the 2014 EIP was no more than 22,052,130, which number consisted of (i) 15,500,000 ordinary shares of the Company; plus (ii) the number of shares available for issuance pursuant to the grant of future awards under the 2011 EIP; plus (iii) any shares subject to outstanding stock awards granted under the 2011 EIP and the 2005 Plan that expire or terminate for any reason prior to exercise or settlement or are forfeited, redeemed or repurchased because of the failure to meet a contingency or condition required to vest such shares; less (iv) 10,000,000 shares, which is the additional number of shares which were previously approved as an increase to the share reserve of the 2011 EIP. On March 23, 2015, the compensation committee of the Company’s board of directors approved amending the 2014 EIP subject to shareholder approval to, among other things, increase the aggregate number of shares authorized for issuance under the 2014 EIP by an additional 14,000,000 shares. On May 6, 2015, the shareholders of the Company approved such amendment to the 2014 EIP. On February 25, 2016, the compensation committee of the Company’s board of directors approved, subject to shareholder approval, amending the 2014 EIP to, among other things, increase the aggregate number of shares authorized for issuance under the 2014 EIP beyond those remaining available for future grant under the 2014 EIP by an additional 6,000,000 shares and also approved a reduction in the number of shares authorized under our 2014 Non-Employee Equity Plan and 2014 ESPP by 1,000,000 shares and 5,000,000 shares, respectively, contingent on shareholder approval of the amendment to the 2014 EIP. On May 3, 2016, the shareholders of the Company approved the amendment to the 2014 EIP. On August 29, 2017, the compensation committee of the Company’s board of directors approved an amendment to the 2014 EIP, to reserve an additional 1,200,000 shares to be used exclusively for grants of awards to individuals who were not previously employees or non-employee directors of the Company (or following a bona fide period of non-employment with the Company) (the “2017 Inducement Pool”), as an inducement material to the individual’s entry into employment with the Company within the meaning of Rule 5635(c)(4) of the NASDAQ Listing Rules, (“Rule 5635(c)(4)”). The 2014 EIP was amended by the compensation committee of the Company’s board of directors without shareholder approval pursuant to Rule 5635(c)(4). The 2014 Non-Employee Equity Plan provides for the grant of nonstatutory stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards and other forms of stock awards that may be settled in cash, shares or other property to the non-employee directors and consultants of the Company (or a subsidiary company). The total number of ordinary shares of the Company that were initially authorized for issuance under the 2014 Non-Employee Equity Plan was 2,500,000. As described above, effective as of May 3, 2016, the number of ordinary shares authorized for issuance under the 2014 Non-Employee Equity Plan was reduced by 1,000,000 shares. The Company’s board of directors has authority to suspend or terminate the 2014 Non-Employee Equity Plan at any time. As of September 30, 2017, an aggregate of 3,819,449 ordinary shares were authorized and available for future grants under the 2014 EIP, of which 726,041 shares relate to the 2017 Inducement Pool. As of September 30, 2017, 499,913 ordinary shares were authorized and available for future grants under the 2014 Non-Employee Equity Plan. Stock Options The following table summarizes stock option activity during the nine months ended September 30, 2017: Options Weighted Average Exercise Price Weighted Average Contractual Term Remaining (in years) Aggregate Intrinsic Value (in thousands) Outstanding as of December 31, 2016 13,627,519 $ 18.17 7.60 $ 35,157 Granted 2,020,017 16.46 Exercised (270,427 ) 6.35 Forfeited (550,871 ) 18.54 Expired (255,653 ) 20.70 Outstanding as of September 30, 2017 14,570,585 18.10 7.14 18,333 Exercisable as of September 30, 2017 8,885,001 $ 16.84 6.39 $ 17,699 Stock options typically have a contractual term of ten years from grant date. The fair value of each stock option award is estimated on the date of grant using the Black-Scholes option pricing model. The determination of the fair value of each stock option is affected by the Company’s share price on the date of grant, as well as assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to, the Company’s expected share price volatility over the expected life of the awards and actual and projected stock option exercise behavior. The weighted average fair value per share of stock option awards granted during the nine months ended September 30, 2017 and 2016, and assumptions used to value stock options, are as follows: For the Nine Months Ended September 30, 2017 2016 Dividend yield — — Risk-free interest rate 1.8% - 2.0% 1.3% - 1.8% Weighted average expected volatility 49.1% 73.8% Expected life (in years) 6.0 6.1 Weighted average grant-date fair value per share of options granted $ 7.99 $ 11.78 Dividend yield The Company has never paid dividends and does not anticipate paying any dividends in the near future. Additionally, the Credit Agreement (described in Note 14 above and Note 21 below), as well as the indentures governing the 2024 Senior Notes and the 2023 Senior Notes (each as described in Note 14 above), contain covenants that restrict the Company from issuing dividends. Risk-Free Interest Rate The Company determined the risk-free interest rate by using a weighted average assumption equivalent to the expected term based on the U.S. Treasury constant maturity rate as of the date of grant. Volatility The Company used an average historical share price volatility of comparable companies to be representative of future share price volatility. Expected Term Given the Company’s limited historical exercise behavior, the expected term of options granted was determined using the “simplified” method since the Company does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate the expected term. Under this approach, the expected term is presumed to be the average of the vesting term and the contractual life of the option. Forfeitures As share-based compensation expense recognized in the condensed consolidated statements of comprehensive loss is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures based on actual forfeiture experience, analysis of employee turnover and other factors. The Company adopted ASU No. 2016-09 on January 1, 2017 and has elected to retain a forfeiture rate after adoption. Restricted Stock Units The following table summarizes restricted stock unit activity for the nine months ended September 30, 2017: Number of Units Weighted Average Grant-Date Fair Value Per Unit Outstanding as of December 31, 2016 3,367,871 $ 18.45 Granted 3,454,579 12.34 Vested (1,040,529 ) 16.86 Forfeited (440,874 ) 17.46 Outstanding as of September 30, 2017 5,341,047 $ 14.89 The grant-date fair value of restricted stock units is the closing price of the Company’s ordinary shares on the date of grant. Performance Stock Units The following table summarizes performance stock unit awards (“PSUs”) activity for the nine months ended September 30, 2017: Number of Units Weighted Average Grant-Date Fair Value Per Unit Average Illiquidity Discount Recorded Weighted Average Fair Value Per Unit Outstanding as of December 31, 2016 12,045,656 Vested (25,000 ) $ 12.36 0.0% $ 13.30 Forfeited (238,336 ) 10.86 7.5 % 10.04 Outstanding as of September 30, 2017 11,782,320 All outstanding PSUs were granted in 2015 and 2016 and may vest if the Company’s total compounded annual shareholder rate of return (“TSR”) over three performance measurement periods summarized below equals or exceeds a minimum of 15%. Vesting Tranche Percent of Total PSU Award Beginning of Performance Measurement Period End of Performance Measurement Period Length of Performance Measurement Period (Years) Tranche One 33.3 % March 23, 2015 December 22, 2017 2.75 Tranche Two 33.3 % March 23, 2015 March 22, 2018 3.00 Tranche Three 33.3 % March 23, 2015 June 22, 2018 3.25 These outstanding PSUs granted in 2015 and 2016 will vest in amounts ranging from 25% to 100% based on the achievement of the following TSR over the three performance periods: TSR Achieved Vesting 15% 25 % 30% 50 % 45% 75 % 60% 100 % The TSR will be based on the volume weighted average trading price (“VWAP”) of the Company’s ordinary shares over the 20 trading days ending on the last day of each of the three performance measurement periods versus the VWAP of the Company’s ordinary shares over the twenty trading days ended March 23, 2015 of $21.50. These PSUs are subject to a post vesting holding period of one year for 50% of the PSUs and two years for 50% of the PSUs for those who were members of the executive committee at the date of grant, and one year for 50% of the PSUs for all others who were not executive committee members at the date of grant. The Company accounts for the PSUs as equity-settled awards in accordance with ASC 718. Because the value of the outstanding PSUs granted in 2015 and 2016 is dependent upon the attainment of a level of TSR, it requires the impact of the market condition to be considered when estimating the fair value of the PSUs. As a result, the Monte Carlo model is applied and the most significant valuation assumptions used include: For the Nine Months Ended September 30, 2017 2016 Valuation date stock price N/A $17.72 - $21.07 Expected volatility N/A 76.8% - 77.6% Risk free rate N/A 1.0% - 1.2% The average estimated fair value of each outstanding PSU is as follows (allocated between groupings based on grant-date classification): Number of Units Weighted Average Fair Value Per Unit Average Illiquidity Discount Recorded Weighted Average Fair Value Per Unit Executive committee members 8,889,656 $ 15.15 18.9 % $ 12.29 Non-executive committee members 2,892,664 13.78 7.3 % 12.77 11,782,320 $ 14.82 16.3 % $ 12.41 During the nine months ended September 30, 2017 and 2016, the Company recorded an expense of $37.0 million and $36.1 million, respectively, related to PSUs. Cash Long-Term Incentive Program On November 5, 2014, the compensation committee of the Company’s board of directors approved a performance cash long-term incentive program for the members of the Company’s executive committee and executive leadership team, including its executive officers (the “Cash Bonus Program”). Participants in the Cash Bonus Program were eligible for a specified cash bonus. The Cash Bonus Program pool funding of approximately $15.8 million was determined based on the Company’s actual TSR over the period from November 5, 2014 to May 6, 2015, and the bonus could be earned and payable only if the TSR for the period from November 5, 2014 to November 4, 2017 was greater than 15%. The portion of the total bonus pool payable to individual participants was based on allocations established by the Company’s compensation committee. Participants must have remained employed by the Company through November 4, 2017 unless a participant’s earlier departure from employment was due to death, disability, termination without cause or a change in control transaction. Bonus payments under the Cash Bonus Program, if any, were to be made after November 4, 2017. Subsequent to September 30, 2017, the TSR did not exceed the minimum target requirement of 15% and the Cash Bonus Program expired without payment. The Company accounted for the Cash Bonus Program under the liability method in accordance with ASC 718. Because vesting of the bonus pool was dependent upon the attainment of a VWAP of $18.37 or higher over the twenty trading days ending November 4, 2017, the Cash Bonus Program was considered to be subject to a “market condition” for the purposes of ASC 718. ASC 718 required the impact of the market condition to be considered when estimating the fair value of the bonus pool. As a result, the Monte Carlo simulation model was applied and the fair value was revalued at each reporting period. As of September 30, 2017 and December 31, 2016, the estimated fair value was zero and $4.8 million, respectively. For the nine months ended September 30, 2017, the Company recorded a reduction in the expense of $3.5 million to the condensed consolidated statement of comprehensive loss as a result of the valuation of the Cash Bonus Program. The most significant valuation assumptions used as of September 30, 2017 include: • Valuation Date Stock Price - $12.68 • Expected Volatility - The expected volatility assumption of 38.0% is based on the Company’s historical volatility over the 0.10 year period ended September 30, 2017, based upon daily stock price observations. • Risk Free Rate - 1.07%, which is based upon the yield on U.S. Treasury Separate Trading of Registered Interest and Principal Securities with a remaining term of 0.10 years as of September 30, 2017. Share-Based Compensation Expense The following table summarizes share-based compensation expense included in the Company’s condensed consolidated statements of operations for the nine months ended September 30, 2017 and 2016 (in thousands): For the Nine Months Ended September 30, 2017 2016 Cost of goods sold $ 1,696 $ — Research and development 6,613 6,845 Selling, general and administrative 79,626 78,076 Total share-based compensation expense $ 87,935 $ 84,921 During the year ended December 31, 2016, no material income tax benefit was recognized relating to share-based compensation expense and no tax benefits were realized from exercised stock options and vested restricted stock units, due to the Company’s net loss position prior to the adoption of ASU No. 2016-09. After the adoption of ASU No. 2016-09, during the three and nine months ended September 30, 2017, no material income tax benefit or detriment was recognized related to share-based compensation resulting from the current share prices in effect at the time of the exercise of stock options and vesting of restricted stock units. As of September 30, 2017, the Company estimates that pre-tax unrecognized compensation expense of $156.5 million for all unvested share-based awards, including stock options, restricted stock units and PSUs, will be recognized through the third quarter of 2021. The Company expects to satisfy the exercise of stock options and future distribution of shares for restricted stock units and PSUs by issuing new ordinary shares which have been reserved under the 2014 EIP. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 20 – INCOME TAXES The Company accounts for income taxes based upon an asset and liability approach. Deferred tax assets and liabilities represent the future tax consequences of the differences between the financial statement carrying amounts of assets and liabilities versus the tax basis of assets and liabilities. Under this method, deferred tax assets are recognized for deductible temporary differences, and operating loss and tax credit carryforwards. Deferred tax liabilities are recognized for taxable temporary differences. Deferred tax assets are reduced by valuation allowances when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The impact of tax rate changes on deferred tax assets and liabilities is recognized in the period in which the change is enacted. The following table presents the expense (benefit) for income taxes for the three and nine months ended September 30, 2017 and 2016 (in thousands): For For 2017 2016 2017 2016 Loss before expense (benefit) for income taxes $ (56,790 ) $ (33,617 ) $ (406,216 ) $ (68,238 ) Expense (benefit) for income taxes 7,181 (27,747 ) (42,138 ) (31,946 ) Net loss $ (63,971 ) $ (5,870 ) $ (364,078 ) $ (36,292 ) During the three and nine months ended September 30, 2017, the Company recorded an expense of $7.2 million and a benefit for income taxes of $42.1 million, respectively, compared to a benefit of $27.7 million and $31.9 million during the three and nine months ended September 30, 2016, respectively. The expense for income taxes during the three months ended September 30, 2017 resulted from a change in the mix of pre-tax losses being incurred between high and low tax rate jurisdictions, which decreased the Company’s expected benefit for the full-year 2017, and resulted in a tax expense being recorded during the three months ended September 30, 2017. The increase in benefit for income taxes for the nine months ended September 30, 2017 compared to the nine months ended September 30, 2016 resulted from an increase in pre-tax losses. Deferred tax assets and liabilities arise from acquisition accounting adjustments where book values of certain assets and liabilities differ from their tax bases. Deferred tax assets and liabilities are recorded at the currently enacted rates which will be in effect at the time when the temporary differences are expected to reverse in the country where the underlying assets and liabilities are located. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 21 – SUBSEQUENT EVENTS Amendment to March 2017 Credit Agreement On October 23, 2017, the Borrowers borrowed approximately $845.8 million aggregate principal amount of loans (the “October 2017 Refinancing Loans”) pursuant to an amendment (the “October 2017 Refinancing Amendment”) to the March 2017 Credit Agreement. The Credit Agreement provides for (i) the October 2017 Refinancing Loans, (ii) one or more uncommitted additional incremental loan facilities subject to the satisfaction of certain financial and other conditions, and (iii) one or more uncommitted refinancing loan facilities with respect to loans thereunder. The Credit Agreement allows for the Company and certain of its subsidiaries to become borrowers under incremental or refinancing facilities. The October 2017 Refinancing Loans were incurred as a separate new class of term loans under the Credit Agreement with substantially the same terms as the March 2017 Refinancing Loans to effectuate a repricing of the March 2017 Refinancing Loans. The October 2017 Refinancing Loans bear interest, at the Borrowers’ option, at a rate equal to either LIBOR plus an applicable margin of 3.25% per year (subject to a LIBOR floor of 1.00%), or the adjusted base rate plus 2.25%. The adjusted base rate is defined as the greater of (a) LIBOR (using one-month interest period) plus 1.00%, (b) prime rate, (c) fed funds plus 0.5%, and (d) 2.00%. The Borrowers used the proceeds of the October 2017 Refinancing Loans to repay the March 2017 Refinancing Loans, which totaled approximately $845.8 million. The obligations under the Credit Agreement (including obligations in respect of the October 2017 Refinancing Loans) and any swap obligations and cash management obligations owing to a lender (or an affiliate of a lender) thereunder are guaranteed by the Company and each of the Company’s existing and subsequently acquired or formed direct and indirect subsidiaries (other than certain immaterial subsidiaries, subsidiaries whose guarantee would result in material adverse tax consequences and subsidiaries whose guarantee is prohibited by applicable law). The obligations under the Credit Agreement (including obligations in respect of the October 2017 Refinancing Loans) and any such swap and cash management obligations are secured, subject to customary permitted liens and other agreed upon exceptions, by a perfected security interest in (i) all tangible and intangible assets of the Borrowers and the guarantors, except for certain customary excluded assets, and (ii) all of the capital stock owned by the Borrowers and guarantors thereunder (limited, in the case of the stock of certain non-U.S. subsidiaries of the Borrowers, to 65% of the capital stock of such subsidiaries). Borrowers under the Credit Agreement are permitted to make voluntary prepayments of the loans under the Credit Agreement at any time without payment of a premium, except that with respect to the October 2017 Refinancing Loans, a 1.00% premium will apply to a repayment of the October 2017 Refinancing Loans in connection with a repricing of, or any amendment to the Credit Agreement in a repricing of, such loans effected on or prior to the date that is six months following October 23, 2017. The Borrowers are required to make mandatory prepayments of loans under the Credit Agreement (without payment of a premium) with (a) net cash proceeds from certain non-ordinary course asset sales (subject to reinvestment rights and other exceptions), (b) casualty proceeds and condemnation awards (subject to reinvestment rights and other exceptions), (c) net cash proceeds from issuances of debt (other than certain permitted debt), and (d) 50% of the Company’s excess cash flow (subject to decrease to 25% or 0% if the Company’s first lien leverage ratio is less than 2.25:1 or 1.75:1, respectively). The October 2017 Refinancing Loans will amortize in equal quarterly installments beginning on December 31, 2017 in an aggregate annual amount equal to 1.00% of the original principal amount of the March 2017 Refinancing Loans (i.e. $850.0 million), with any remaining balance payable on March 29, 2024, the final maturity date of the October 2017 Refinancing Loans. The Credit Agreement contains customary representations and warranties and customary affirmative and negative covenants, including, among other things, restrictions on indebtedness, liens, investments, mergers, dispositions, prepayment of other indebtedness and dividends and other distributions. Events of default under the Credit Agreement include: (i) the failure by any Borrower to timely make payments due under the Credit Agreement; (ii) material misrepresentations or misstatements in any representation or warranty by any Loan Party when made; (iii) failure by any Loan Party to comply with the covenants under the Credit Agreement and other related agreements; (iv) certain defaults under a specified amount of other indebtedness of the Company or its subsidiaries; (v) insolvency or bankruptcy-related events with respect to the Company or any of its material subsidiaries; (vi) certain undischarged judgments against the Company or any of its restricted subsidiaries; (vii) certain ERISA-related events reasonably expected to have a material adverse effect on the Company and its restricted subsidiaries taken as a whole; (viii) certain security interests or liens under the loan documents ceasing to be, or being asserted by the Company or its restricted subsidiaries not to be, in full force and effect; (ix) any loan document or material provision thereof ceasing to be, or any challenge or assertion by any Loan Party that such loan document or material provision is not, in full force and effect; and (x) the occurrence of a change of control. If one or more events of default occurs and continues beyond any applicable cure period, the administrative agent may, with the consent of the lenders holding a majority of the loans and commitments under the facilities, or will, at the request of such lenders, terminate the commitments of the lenders to make further loans and declare all of the obligations of the Loan Parties under the Credit Agreement to be immediately due and payable. |
Basis of Presentation and Bus27
Basis of Presentation and Business Overview (Policies) | 9 Months Ended |
Sep. 30, 2017 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The unaudited condensed consolidated financial statements presented herein have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the financial statements do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments, including normal recurring adjustments, considered necessary for a fair statement of the financial statements have been included. Operating results for the three and nine months ended September 30, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017. The December 31, 2016 condensed consolidated balance sheet was derived from audited financial statements, but does not include all disclosures required by GAAP. Unless otherwise indicated or the context otherwise requires, references to the “Company”, “we”, “us” and “our” refer to Horizon Pharma plc and its consolidated subsidiaries. The unaudited condensed consolidated financial statements presented herein include the accounts of the Company and its wholly owned subsidiaries. All inter-company transactions and balances have been eliminated. On January 13, 2016 completed its acquisition of On October 25, 2016, the Company completed its acquisition of Raptor Pharmaceutical Corp. (“Raptor”) in which the Company acquired all of the issued and outstanding shares of Raptor’s common stock for $9.00 per share in cash. The total consideration was $860.8 million, including $24.9 million of cash acquired and $56.0 million paid to settle Raptor’s outstanding debt. Following completion of the acquisition, Raptor became a wholly owned subsidiary of the Company and converted to a limited liability company, changing its name to Horizon Pharmaceutical LLC. On May 8, 2017, the Company acquired River Vision Development Corp. (“River Vision”) for upfront cash payments totaling $151.9 million, including $6.3 million of cash acquired, and subject to other customary purchase price adjustments for working capital, and potential future milestone and royalty payments contingent on the satisfaction of certain regulatory milestones and sales thresholds. Following completion of the acquisition, River Vision became a wholly owned subsidiary of the Company and was renamed as Horizon Pharma Tepro, Inc. On June 23, 2017, the Company sold its European subsidiary that owned the marketing rights to PROCYSBI ® On June 30, 2017, the Company completed its acquisition of certain rights to interferon gamma-1b from Boehringer Ingelheim International GmbH (“Boehringer Ingelheim International”) in all territories outside of the United States, Canada and Japan, as the Company previously held marketing rights to interferon gamma-1b in these territories. Boehringer Ingelheim International commercialized interferon gamma-1b under the trade names IMUKIN ® ® ® ® ® The unaudited condensed consolidated financial statements presented herein include the results of operations of the acquired Crealta and Raptor businesses from the applicable dates of acquisition. See Note 3 for further details of acquisitions and divestitures. Beginning in the first quarter of 2017, the Company modified its presentation of certain operating expenses. Previously, the Company presented “general and administrative” expenses as one line item in its condensed consolidated statement of comprehensive loss, and “selling and marketing” expenses as another. For current-period presentation and prior-period comparisons, the Company now combines these two line items into one line item, titled “selling, general and administrative” expenses. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements From time to time, the Company adopts new accounting pronouncements issued by the Financial Accounting Standards Board (“FASB”) or other standard-setting bodies. Effective January 1, 2017, the Company elected to early adopt ASU No. Business Combinations (Topic 805): Clarifying the Definition of a Business ASU No. The adoption did not have a material impact on the Company’s condensed consolidated financial statements and related disclosures. Effective January 1, 2017, the Company adopted ASU No. 2016-09, Improvements to Employee Share-Based Payment Accounting In May 2017, the FASB issued ASU No. 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting In February 2017, the FASB issued ASU No. 2017-05, (“ Subtopic 610-20 , Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets The Company does not expect the adoption of ASU No. 2017-05 to have a material impact condensed In January 2017, the FASB issued ASU No. 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment on the Company’s consolidated financial statements and related disclosures. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash The Company does not expect the adoption of to have a material impact on the Company’s condensed consolidated financial statements and related disclosures In October 2016, the FASB issued ASU No. Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) In May 2014, the FASB issued ASU Revenue from Contracts with Customers Revenue From Contracts with Customers (Topic 606): Principal Versus Agent Considerations Revenue From Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing, , Technical Corrections and Improvements to Topic 606, Revenue From Contracts with Customers Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840) and Leases (Topic 842), Other recent authoritative guidance issued by the FASB (including technical corrections to the Accounting Standards Codification), the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not, or are not expected to, have a material impact on the Company’s condensed consolidated financial statements and related disclosures. |
Net Loss per Share (Tables)
Net Loss per Share (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Basic and Diluted Net Loss per Share | The following table presents basic and diluted net loss per share for the three and nine months ended September 30, 2017 and 2016 (in thousands, except share and per share data): For the Three Months Ended September 30, For the Nine Months Ended September 30, 2017 2016 2017 2016 Basic and diluted net loss per share calculation: Net loss $ (63,971 ) $ (5,870 ) $ (364,078 ) $ (36,292 ) Weighted average ordinary shares outstanding 163,447,208 161,038,827 162,810,551 160,472,530 Basic and diluted net loss per share $ (0.39 ) $ (0.04 ) $ (2.24 ) $ (0.23 ) |
Divestitures, Acquisitions an29
Divestitures, Acquisitions and Other Arrangements (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Consolidated Pro Forma Financial Information | Additionally, the following table sets forth financial information and has been compiled from historical financial statements and other information, but is not necessarily indicative of the results that actually would have been achieved had the transactions occurred on the dates indicated or that may be achieved in the future (in thousands): For the Nine Months Ended September As reported Pro forma Pro forma adjustments Net sales $ 670,770 $ 99,571 $ 770,341 Net loss (36,292 ) (112,274 ) (148,566 ) |
Raptor Pharmaceutical Corp [Member] | |
Total Consideration for Acquisition | The total consideration for the acquisition was approximately $860.8 million, including $24.9 million of cash acquired and $56.0 million paid to settle Raptor’s outstanding debt, and was composed of the following (in thousands): Cash $ 841,494 Net settlements on the exercise of stock options and restricted stock units 19,268 Total consideration $ 860,762 |
Fair Values Assigned to Assets Acquired and Liabilities Assumed | The following table summarizes the preliminary fair values assigned to the assets acquired and the liabilities assumed by the Company, along with the resulting goodwill before and after the measurement period adjustment (in thousands): (Liabilities assumed) and assets acquired: Before Adjustment After Accounts payable $ (4,572 ) $ — $ (4,572 ) Accrued expenses (23,773 ) (240 ) (24,013 ) Accrued trade discounts and rebates (6,377 ) 1,350 (5,027 ) Deferred tax liabilities (237,166 ) 1,743 (235,423 ) Contingent royalty liability (102,000 ) — (102,000 ) Accrued royalties (2,705 ) — (2,705 ) Other non-current liability (25,500 ) — (25,500 ) Cash and cash equivalents 24,897 — 24,897 Restricted cash 1,350 — 1,350 Accounts receivable, net 17,767 — 17,767 Inventories 74,463 — 74,463 Prepaid expenses and other current assets 4,194 — 4,194 Property and equipment 3,373 — 3,373 Developed technology 946,000 — 946,000 Other non-current assets 1,765 — 1,765 Goodwill 189,046 (2,853 ) 186,193 Fair value of consideration paid $ 860,762 $ — $ 860,762 |
Crealta Holdings LLC [Member] | |
Total Consideration for Acquisition | The total consideration for the acquisition was approximately $539.7 million, including $24.9 million of cash acquired and $70.9 million paid to settle Crealta’s outstanding debt, Cash $ 536,206 Net settlements on the exercise of stock options and restricted stock units 3,526 Total consideration $ 539,732 |
Fair Values Assigned to Assets Acquired and Liabilities Assumed | The following table summarizes the final fair values assigned to the assets acquired and the liabilities assumed by the Company (in thousands): (Liabilities assumed) and assets acquired: Allocation Accounts payable and accrued expenses $ (4,543 ) Accrued trade discounts and rebates (1,424 ) Deferred tax liabilities (20,141 ) Other non-current liabilities (6,900 ) Contingent royalty liabilities (51,300 ) Cash and cash equivalents 24,893 Accounts receivable 10,014 Inventories 149,363 Prepaid expenses and other current assets 1,382 Developed technology 428,200 Other non-current assets 275 Goodwill 9,913 Fair value of consideration paid $ 539,732 |
Chiesi Divestiture [Member] | |
Gain on Divestiture | The gain on divestiture was determined as follows (in thousands): For the Three Months Ended For the Nine Months Ended September 30, 2017 September 30, 2017 Cash proceeds $ — $ 72,163 Add reimbursement of royalties — 27,101 Less net assets sold: Developed technology — (47,261 ) Goodwill — (16,285 ) Other — (24,482 ) Transaction and other costs 112 (5,268 ) Gain on divestiture $ 112 $ 5,968 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Inventory Disclosure [Abstract] | |
Components of Inventories | The components of inventories as of September 30, 2017 and December 31, 2016 consisted of the following (in thousands): September 30, 2017 December 31, 2016 Raw materials $ 17,412 $ 10,233 Work-in-process 16,230 85,022 Finished goods 52,885 79,533 Inventories, net $ 86,527 $ 174,788 |
Prepaid Expenses and Other Cu31
Prepaid Expenses and Other Current Assets (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract] | |
Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets as of September 30, 2017 and December 31, 2016 consisted of the following (in thousands): September 30, 2017 December 31, 2016 Medicine samples inventory $ 13,374 $ 10,192 Prepaid income taxes 10,559 9,155 Rabbi trust assets 5,717 3,073 Other prepaid expenses and other current assets 23,275 27,199 Prepaid expenses and other current assets $ 52,925 $ 49,619 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Property Plant And Equipment [Abstract] | |
Property and Equipment | Property and equipment as of September 30, 2017 and December 31, 2016 consisted of the following (in thousands): September 30, 2017 December 31, 2016 Software $ 14,786 $ 10,876 Leasehold improvements 9,397 9,184 Machinery and equipment 4,931 4,566 Computer equipment 2,260 3,069 Other 2,689 2,664 34,063 30,359 Less accumulated depreciation (12,458 ) (8,319 ) Construction in process 95 17 Software implementation in process — 1,427 Property and equipment, net $ 21,700 $ 23,484 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Schedule of Gross Carrying Amount of Goodwill | The gross carrying amount of goodwill as of September 30, 2017 was as follows (in thousands): Balance at December 31, 2016 $ 445,579 Divestiture during the period (16,285 ) Measurement period adjustments (2,853 ) Balance at September 30, 2017 $ 426,441 |
Amortizable Intangible Assets | Intangible assets as of September 30, 2017 and December 31, 2016 consisted of the following (in thousands): September 30, 2017 December 31, 2016 Cost Accumulated Amortization Net Book Value Cost Basis Accumulated Amortization Net Book Value Developed technology $ 3,115,695 $ (603,283 ) $ 2,512,412 $ 3,166,695 $ (399,511 ) $ 2,767,184 Customer relationships 8,100 (2,457 ) 5,643 8,100 (1,849 ) 6,251 Total intangible assets $ 3,123,795 $ (605,740 ) $ 2,518,055 $ 3,174,795 $ (401,360 ) $ 2,773,435 |
Estimated Future Amortization Expense | As of September 30, 2017 estimated future amortization expense was as follows (in thousands): 2017 (October to December) $ 68,666 2018 274,084 2019 261,092 2020 261,068 2021 253,373 Thereafter 1,399,772 Total $ 2,518,055 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Accrued Expenses [Member] | |
Payables And Accruals [Line Items] | |
Schedule of Accrued Liabilities / Expenses | Accrued expenses as of September 30, 2017 and December 31, 2016 consisted of the following (in thousands): September 30, 2017 December 31, 2016 Payroll-related expenses $ 47,730 $ 66,417 Consulting and professional services 35,660 33,614 Accrued interest 26,496 18,938 Contingent consideration liability 20,000 — Accrued other 32,815 31,296 Litigation settlement — 32,500 Accrued expenses $ 162,701 $ 182,765 |
Accrued Trade Discounts and R35
Accrued Trade Discounts and Rebates (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Accrued Trade Discounts and Rebates [Member] | |
Valuation And Qualifying Accounts Disclosure [Line Items] | |
Schedule of Accrued Liabilities / Expenses | Accrued trade discounts and rebates as of , 2016 (in thousands): September 30, 2017 December 31, 2016 Accrued wholesaler fees and commercial rebates $ 183,133 $ 47,460 Accrued co-pay and other patient assistance 175,991 188,504 Accrued government rebates and chargebacks 76,590 61,592 Accrued trade discounts and rebates 435,714 297,556 Invoiced wholesaler fees and commercial rebates, co-pay and other patient assistance, and government rebates and chargebacks in accounts payable 13,283 16,830 Total customer-related accruals and allowances $ 448,997 $ 314,386 |
Customer-related Accruals and Allowances [Member] | |
Valuation And Qualifying Accounts Disclosure [Line Items] | |
Schedule of Customer-Related Accruals and Allowances | The following table summarizes changes in the Company’s customer-related accruals and allowances from December 31, 2016 to September 30, 2017 (in thousands): Wholesaler Fees Co-Pay and Government and Commercial Other Patient Rebates and Rebates Assistance Chargebacks Total Balance at December 31, 2016 $ 47,651 $ 205,143 $ 61,592 $ 314,386 Measurement period adjustment — — (1,350 ) (1,350 ) Current provisions relating to sales during the nine months ended September 30, 2017 472,118 1,406,614 245,547 2,124,279 Adjustments relating to prior-year sales 5,580 (59 ) (4,904 ) 617 Payments relating to sales during the nine months ended September 30, 2017 (288,749 ) (1,230,603 ) (156,118 ) (1,675,470 ) Payments relating to prior-year sales (53,043 ) (205,084 ) (55,338 ) (313,465 ) Balance at September 30, 2017 $ 183,557 $ 176,011 $ 89,429 $ 448,997 |
Accrued Royalties (Tables)
Accrued Royalties (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Accrued Royalties [Member] | |
Schedule of Accrued Liabilities / Expenses | During the nine months ended September 30, 2017, changes to the liability for royalties for medicines acquired through business combinations consisted of the following (in thousands): Balance as of December 31, 2016 $ 334,274 Reclassification to other long-term liabilities (5,233 ) Remeasurement of royalty liabilities (2,944 ) Royalty payments (33,796 ) Accretion expense 38,347 Other royalty expense 297 Balance as of September 30, 2017 330,945 Accrued royalties - current portion as of September 30, 2017 62,273 Accrued royalties, net of current as of September 30, 2017 $ 268,672 |
Segment and Other Information (
Segment and Other Information (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Schedule of Gross Sales from Customers Included in Single Operating Segment | The following table presents the amount and percentage of gross sales from customers that represented more than 10% of the Company’s gross sales included in its single operating segment, and all other customers as a group (in thousands, except percentages): For the Three Months Ended September 30, 2017 2016 Amount % of Amount % of Gross Sales Sales Customer A $ 314,077 31 % $ 365,807 42 % Customer B 267,818 27 % 212,392 25 % Customer C 139,981 14 % 106,360 12 % Other Customers 280,241 28 % 181,291 21 % Gross Sales $ 1,002,117 100 % $ 865,850 100 % For the Nine Months Ended September 30, 2017 2016 Amount % of Gross Amount % of Gross Sales Sales Customer A $ 941,268 31 % $ 1,067,720 45 % Customer B 856,677 29 % 458,951 20 % Customer C 423,446 14 % 260,514 11 % Other Customers 780,983 26 % 563,300 24 % Gross Sales $ 3,002,374 100 % $ 2,350,485 100 % |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities at Fair Value on Recurring Basis | The following tables set forth the Company’s financial assets and liabilities at fair value on a recurring basis as of September 30, 2017 and December 31, 2016 (in thousands): September 30, 2017 Level 1 Level 2 Level 3 Total Assets: Bank time deposits $ — $ 3,000 $ — $ 3,000 Money market funds 552,000 — — 552,000 Other current assets 5,717 — — 5,717 Total assets at fair value $ 557,717 $ 3,000 $ — $ 560,717 Liabilities: Other long-term liabilities (5,717 ) — — (5,717 ) Total liabilities at fair value $ (5,717 ) $ — $ — $ (5,717 ) December 31, 2016 Level 1 Level 2 Level 3 Total Assets: Bank time deposits $ — $ 3,000 $ — $ 3,000 Money market funds 170,000 — — 170,000 Other current assets 3,038 — — 3,038 Total assets at fair value $ 173,038 $ 3,000 $ — $ 176,038 Liabilities: Other long-term liabilities (3,038 ) — — (3,038 ) Total liabilities at fair value $ (3,038 ) $ — $ — $ (3,038 ) |
Debt Agreements (Tables)
Debt Agreements (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Outstanding Debt Balances | The Company’s outstanding debt balances as of September 30, 2017 and December 31, 2016 consisted of the following (in thousands): September 30, 2017 December 31, 2016 2017 Term Loan Facility $ 847,875 — 2015 Term Loan Facility — 394,000 2016 Incremental Loan Facility — 375,000 2023 Senior Notes 475,000 475,000 2024 Senior Notes 300,000 300,000 Exchangeable Senior Notes 400,000 400,000 Total face value 2,022,875 1,944,000 Debt discount (113,508 ) (126,352 ) Deferred financing fees (11,790 ) (10,155 ) Total long-term debt 1,897,577 1,807,493 Less: current maturities 8,500 7,750 Long-term debt, net of current maturities $ 1,889,077 $ 1,799,743 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Commitments And Contingencies Disclosure [Abstract] | |
Schedule of Office Space Lease Agreements in Place for Real Properties | The Company has the following office space lease agreements in place for real properties: Location Approximate Square Feet Lease Expiry Date Dublin, Ireland 18,900 November 3, 2029 Lake Forest, Illinois (1) 160,000 March 31, 2024 Novato, California (2) 61,000 August 31, 2021 Deerfield, Illinois (3) 32,300 June 30, 2018 Brisbane, California 20,100 November 30, 2019 Mannheim, Germany 14,300 December 31, 2018 Chicago, Illinois 6,500 December 31, 2018 Reinach, Switzerland 3,500 May 31, 2020 Washington, D.C. 1,000 December 31, 2018 (1) In connection with the Lake Forest, Illinois lease, the Company has provided a $2.0 million letter of credit to the landlord, through a commercial bank. (2) During March 2017, the Company vacated an area of the office space in Novato, California. During March and April 2017, the Company entered into sublease arrangements for this space with third parties. (3) During January 2016, the Company vacated the premises in Deerfield, Illinois and began occupying the premises in Lake Forest, Illinois. During April 2017, the Company entered into a sublease arrangement for a portion of this space with a third party. During June 2017, the Company terminated a portion of the lease, resulting in 32,300 square feet remaining. |
Share-Based Incentive Plans (Ta
Share-Based Incentive Plans (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Stock Option Activity | The following table summarizes stock option activity during the nine months ended September 30, 2017: Options Weighted Average Exercise Price Weighted Average Contractual Term Remaining (in years) Aggregate Intrinsic Value (in thousands) Outstanding as of December 31, 2016 13,627,519 $ 18.17 7.60 $ 35,157 Granted 2,020,017 16.46 Exercised (270,427 ) 6.35 Forfeited (550,871 ) 18.54 Expired (255,653 ) 20.70 Outstanding as of September 30, 2017 14,570,585 18.10 7.14 18,333 Exercisable as of September 30, 2017 8,885,001 $ 16.84 6.39 $ 17,699 |
Weighted Average Fair Value per Share of Stock Option Awards Granted and Assumptions Used to Value Stock Options | The weighted average fair value per share of stock option awards granted during the nine months ended September 30, 2017 and 2016, and assumptions used to value stock options, are as follows: For the Nine Months Ended September 30, 2017 2016 Dividend yield — — Risk-free interest rate 1.8% - 2.0% 1.3% - 1.8% Weighted average expected volatility 49.1% 73.8% Expected life (in years) 6.0 6.1 Weighted average grant-date fair value per share of options granted $ 7.99 $ 11.78 |
Summary of Restricted Stock Unit Activity | The following table summarizes restricted stock unit activity for the nine months ended September 30, 2017: Number of Units Weighted Average Grant-Date Fair Value Per Unit Outstanding as of December 31, 2016 3,367,871 $ 18.45 Granted 3,454,579 12.34 Vested (1,040,529 ) 16.86 Forfeited (440,874 ) 17.46 Outstanding as of September 30, 2017 5,341,047 $ 14.89 |
Summary of Performance Stock Unit Awards (PSUs) Activity | The following table summarizes performance stock unit awards (“PSUs”) activity for the nine months ended September 30, 2017: Number of Units Weighted Average Grant-Date Fair Value Per Unit Average Illiquidity Discount Recorded Weighted Average Fair Value Per Unit Outstanding as of December 31, 2016 12,045,656 Vested (25,000 ) $ 12.36 0.0% $ 13.30 Forfeited (238,336 ) 10.86 7.5 % 10.04 Outstanding as of September 30, 2017 11,782,320 |
Summary of Vesting Tranches | All outstanding PSUs were granted in 2015 and 2016 and may vest if the Company’s total compounded annual shareholder rate of return (“TSR”) over three performance measurement periods summarized below equals or exceeds a minimum of 15%. Vesting Tranche Percent of Total PSU Award Beginning of Performance Measurement Period End of Performance Measurement Period Length of Performance Measurement Period (Years) Tranche One 33.3 % March 23, 2015 December 22, 2017 2.75 Tranche Two 33.3 % March 23, 2015 March 22, 2018 3.00 Tranche Three 33.3 % March 23, 2015 June 22, 2018 3.25 These outstanding PSUs granted in 2015 and 2016 will vest in amounts ranging from 25% to 100% based on the achievement of the following TSR over the three performance periods: TSR Achieved Vesting 15% 25 % 30% 50 % 45% 75 % 60% 100 % |
Summary of Significant Valuation Assumptions | The Company accounts for the PSUs as equity-settled awards in accordance with ASC 718. Because the value of the outstanding PSUs granted in 2015 and 2016 is dependent upon the attainment of a level of TSR, it requires the impact of the market condition to be considered when estimating the fair value of the PSUs. As a result, the Monte Carlo model is applied and the most significant valuation assumptions used include: For the Nine Months Ended September 30, 2017 2016 Valuation date stock price N/A $17.72 - $21.07 Expected volatility N/A 76.8% - 77.6% Risk free rate N/A 1.0% - 1.2% |
Summary of Average Estimated Fair Value of PSU | The average estimated fair value of each outstanding PSU is as follows (allocated between groupings based on grant-date classification): Number of Units Weighted Average Fair Value Per Unit Average Illiquidity Discount Recorded Weighted Average Fair Value Per Unit Executive committee members 8,889,656 $ 15.15 18.9 % $ 12.29 Non-executive committee members 2,892,664 13.78 7.3 % 12.77 11,782,320 $ 14.82 16.3 % $ 12.41 |
Summary of Share-Based Compensation Expense | The following table summarizes share-based compensation expense included in the Company’s condensed consolidated statements of operations for the nine months ended September 30, 2017 and 2016 (in thousands): For the Nine Months Ended September 30, 2017 2016 Cost of goods sold $ 1,696 $ — Research and development 6,613 6,845 Selling, general and administrative 79,626 78,076 Total share-based compensation expense $ 87,935 $ 84,921 |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Expense (Benefit) for Income Taxes | The following table presents the expense (benefit) for income taxes for the three and nine months ended September 30, 2017 and 2016 (in thousands): For For 2017 2016 2017 2016 Loss before expense (benefit) for income taxes $ (56,790 ) $ (33,617 ) $ (406,216 ) $ (68,238 ) Expense (benefit) for income taxes 7,181 (27,747 ) (42,138 ) (31,946 ) Net loss $ (63,971 ) $ (5,870 ) $ (364,078 ) $ (36,292 ) |
Basis of Presentation and Bus43
Basis of Presentation and Business Overview - Additional Information (Detail) $ / shares in Units, $ in Thousands, € in Millions | Jun. 30, 2017USD ($)Country$ / € | Jun. 30, 2017EUR (€)Country$ / € | Jun. 23, 2017USD ($) | May 08, 2017USD ($) | Oct. 25, 2016USD ($)$ / shares | Jan. 13, 2016USD ($) | Jun. 30, 2017USD ($)Country$ / € | Jun. 30, 2017EUR (€)Country$ / € | May 31, 2016USD ($)$ / € | May 31, 2016EUR (€)$ / € | Sep. 30, 2017USD ($) | Sep. 30, 2017USD ($) | Jan. 01, 2018USD ($) | Jan. 01, 2017USD ($) | Dec. 31, 2016USD ($) |
Basis Of Presentation [Line Items] | |||||||||||||||
Cumulative effect adjustment to accumulated deficit | $ (1,205,880) | $ (1,205,880) | $ (848,021) | ||||||||||||
ASU 2016-09 [Member] | |||||||||||||||
Basis Of Presentation [Line Items] | |||||||||||||||
Cumulative effect adjustment to accumulated deficit | $ 7,200 | ||||||||||||||
Excess tax deficiency | $ 500 | $ 900 | |||||||||||||
ASU 2016-09 [Member] | Restatement Adjustment [Member] | |||||||||||||||
Basis Of Presentation [Line Items] | |||||||||||||||
Cumulative effect adjustment to accumulated deficit | $ 7,200 | ||||||||||||||
ASU No. 2014-09 [Member] | Scenario Forecast [Member] | |||||||||||||||
Basis Of Presentation [Line Items] | |||||||||||||||
Deferred revenue reclassified directly to retained earnings | $ 10,000 | ||||||||||||||
Disposal Group, Not Discontinued Operations [Member] | Chiesi Divestiture [Member] | |||||||||||||||
Basis Of Presentation [Line Items] | |||||||||||||||
Upfront payment from sale of subsidiary | $ 72,200 | ||||||||||||||
Cash divested | $ 3,100 | ||||||||||||||
Crealta Holdings LLC [Member] | |||||||||||||||
Basis Of Presentation [Line Items] | |||||||||||||||
Business acquisition date | Jan. 13, 2016 | ||||||||||||||
Consideration transferred | $ 539,732 | ||||||||||||||
Cash acquired from acquisition | 24,900 | ||||||||||||||
Outstanding debt amount paid | 70,900 | ||||||||||||||
Cash consideration | $ 536,206 | ||||||||||||||
Raptor Pharmaceutical Corp [Member] | |||||||||||||||
Basis Of Presentation [Line Items] | |||||||||||||||
Business acquisition date | Oct. 25, 2016 | Oct. 25, 2016 | |||||||||||||
Common stock, price per share | $ / shares | $ 9 | ||||||||||||||
Consideration transferred | $ 860,762 | ||||||||||||||
Cash acquired from acquisition | 24,900 | ||||||||||||||
Outstanding debt amount paid | 56,000 | ||||||||||||||
Cash consideration | $ 841,494 | ||||||||||||||
River Vision [Member] | |||||||||||||||
Basis Of Presentation [Line Items] | |||||||||||||||
Cash acquired from acquisition | $ 6,300 | ||||||||||||||
Business acquisition agreement date | May 8, 2017 | ||||||||||||||
Cash consideration | $ 151,900 | ||||||||||||||
Boehringer Ingelheim International GmbH [Member] | |||||||||||||||
Basis Of Presentation [Line Items] | |||||||||||||||
Business acquisition date | Jun. 30, 2017 | Jun. 30, 2017 | Jun. 30, 2017 | ||||||||||||
Cash consideration | $ 22,300 | € 19.5 | $ 22,300 | € 19.5 | $ 5,600 | € 5 | |||||||||
Number of estimated countries commercializes under trade names | Country | 30 | 30 | 30 | 30 | |||||||||||
Currency exchange rate | $ / € | 1.1406 | 1.1406 | 1.1406 | 1.1406 | 1.1132 | 1.1132 |
Net Loss per Share - Basic and
Net Loss per Share - Basic and Diluted Net Loss per Share (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Basic and diluted net loss per share calculation: | ||||
Net loss | $ (63,971) | $ (5,870) | $ (364,078) | $ (36,292) |
Weighted average ordinary shares outstanding | 163,447,208 | 161,038,827 | 162,810,551 | 160,472,530 |
Basic and diluted net loss per share | $ (0.39) | $ (0.04) | $ (2.24) | $ (0.23) |
Net Loss per Share - Additional
Net Loss per Share - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | Mar. 13, 2015 | |
Earnings Per Share [Line Items] | ||||||
Senior notes | $ 1,578,947 | $ 1,578,947 | $ 1,501,741 | |||
Incremental common shares attributable to dilutive effect of conversion of Exchangeable Senior Notes | 0 | 0 | 0 | 0 | ||
Exchangeable Senior Notes [Member] | ||||||
Earnings Per Share [Line Items] | ||||||
Interest rate | 2.50% | 2.50% | ||||
Horizon Investment [Member] | Exchangeable Senior Notes [Member] | ||||||
Earnings Per Share [Line Items] | ||||||
Senior notes | $ 400,000 | |||||
Interest rate | 2.50% | 2.50% | ||||
Maturity year of debt instrument | 2,022 | |||||
Equity Awards and Warrants [Member] | ||||||
Earnings Per Share [Line Items] | ||||||
Securities excluded from computation of diluted net loss per share | 18,700,000 | 11,600,000 | 18,200,000 | 14,200,000 |
Divestitures, Acquisitions an46
Divestitures, Acquisitions and Other Arrangements - Additional Information (Detail) $ / shares in Units, € in Millions | Jun. 30, 2017USD ($)Country$ / € | Jun. 30, 2017EUR (€)Country$ / € | Jun. 23, 2017USD ($) | May 08, 2017USD ($) | Nov. 08, 2016USD ($) | Oct. 25, 2016USD ($)$ / shares | Jan. 13, 2016USD ($) | Jun. 30, 2017USD ($)Country$ / € | Jun. 30, 2017EUR (€)Country$ / € | May 31, 2016USD ($)$ / € | May 31, 2016EUR (€)$ / € | Sep. 30, 2017USD ($)€ / $ | Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($)€ / $ | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($)€ / $ | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($)€ / $ | Dec. 31, 2016EUR (€) | Sep. 30, 2017EUR (€)€ / $ | Jun. 27, 2017USD ($) |
Business Acquisition [Line Items] | |||||||||||||||||||||
Additional payment to be recorded upon closing | $ 20,000,000 | $ 20,000,000 | |||||||||||||||||||
Senior notes | 1,578,947,000 | $ 1,501,741,000 | 1,578,947,000 | $ 1,501,741,000 | |||||||||||||||||
Goodwill, measurement period adjustments | $ (2,853,000) | ||||||||||||||||||||
Percentage of estimated cash flows expected to be realized | 90.00% | ||||||||||||||||||||
Net sales | $ 271,646,000 | $ 208,702,000 | $ 782,012,000 | $ 670,770,000 | |||||||||||||||||
2024 Senior Notes [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Interest rate | 8.75% | ||||||||||||||||||||
River Vision [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Percentage of equity interests acquired | 100.00% | ||||||||||||||||||||
Business acquisition agreement date | May 8, 2017 | ||||||||||||||||||||
Cash consideration | $ 151,900,000 | ||||||||||||||||||||
Cash acquired from acquisition | 6,300,000 | ||||||||||||||||||||
Federal net operating losses | 13,100,000 | ||||||||||||||||||||
State net operating losses | 2,800,000 | ||||||||||||||||||||
Federal tax credits | $ 5,800,000 | ||||||||||||||||||||
Boehringer Ingelheim International GmbH [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Cash consideration | $ 22,300,000 | € 19.5 | $ 22,300,000 | € 19.5 | $ 5,600,000 | € 5 | |||||||||||||||
Business acquisition date | Jun. 30, 2017 | Jun. 30, 2017 | Jun. 30, 2017 | ||||||||||||||||||
Number of estimated countries commercializes under trade names | Country | 30 | 30 | 30 | 30 | |||||||||||||||||
Currency exchange rate | $ / € | 1.1406 | 1.1406 | 1.1406 | 1.1406 | 1.1132 | 1.1132 | |||||||||||||||
Boehringer Ingelheim International GmbH [Member] | Selling, General and Administrative [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Currency exchange rate | € / $ | 1.1406 | 1.1406 | 1.1406 | ||||||||||||||||||
Additional payment to be recorded upon closing | $ 22,300,000 | $ 22,300,000 | € 19.5 | ||||||||||||||||||
Raptor Pharmaceutical Corp [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Cash consideration | $ 841,494,000 | ||||||||||||||||||||
Cash acquired from acquisition | $ 24,900,000 | ||||||||||||||||||||
Business acquisition date | Oct. 25, 2016 | Oct. 25, 2016 | |||||||||||||||||||
Business acquisition share price | $ / shares | $ 9 | ||||||||||||||||||||
Debt instrument, aggregate principal amount | $ 375,000,000 | ||||||||||||||||||||
Total consideration | 860,762,000 | ||||||||||||||||||||
Outstanding debt amount paid | 56,000,000 | ||||||||||||||||||||
Acquisition related costs | 3,100,000 | $ 14,600,000 | |||||||||||||||||||
Goodwill, measurement period adjustments | (2,900,000) | ||||||||||||||||||||
Inventory | 74,463,000 | 74,463,000 | |||||||||||||||||||
Preliminary fair value of liability | 102,000,000 | $ 102,000,000 | |||||||||||||||||||
Estimated income tax rate reconciliation, tax settlement, domestic percent | 36.60% | ||||||||||||||||||||
Raptor Pharmaceutical Corp [Member] | Step-Up Adjustments [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Inventory | 67,000,000 | ||||||||||||||||||||
Raptor Pharmaceutical Corp [Member] | 2024 Senior Notes [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Senior notes | $ 300,000,000 | ||||||||||||||||||||
Interest rate | 8.75% | ||||||||||||||||||||
Maturity year of debt instrument | 2,024 | ||||||||||||||||||||
Raptor Pharmaceutical Corp [Member] | Selling, General and Administrative [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Acquisition related costs | 3,000,000 | 4,200,000 | $ 13,800,000 | 4,200,000 | |||||||||||||||||
Raptor Pharmaceutical Corp [Member] | Research and Development [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Acquisition related costs | 100,000 | 700,000 | |||||||||||||||||||
Raptor Pharmaceutical Corp [Member] | Cost of Goods Sold [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Acquisition related costs | 0 | $ 100,000 | |||||||||||||||||||
Crealta Holdings LLC [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Cash consideration | $ 536,206,000 | ||||||||||||||||||||
Cash acquired from acquisition | 24,900,000 | ||||||||||||||||||||
Business acquisition date | Jan. 13, 2016 | ||||||||||||||||||||
Total consideration | 539,732,000 | ||||||||||||||||||||
Outstanding debt amount paid | 70,900,000 | ||||||||||||||||||||
Acquisition related costs | 400,000 | 12,100,000 | |||||||||||||||||||
Inventory | $ 149,363,000 | ||||||||||||||||||||
Preliminary fair value of liability | 51,300,000 | $ 51,300,000 | |||||||||||||||||||
Crealta Holdings LLC [Member] | Commercial Supply Agreements [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Contingent liability | 6,900,000 | 6,900,000 | |||||||||||||||||||
Crealta Holdings LLC [Member] | Step-Up Adjustments [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Inventory | 144,300,000 | 144,300,000 | |||||||||||||||||||
Crealta Holdings LLC [Member] | Selling, General and Administrative [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Acquisition related costs | 100,000 | 500,000 | 600,000 | 11,500,000 | |||||||||||||||||
Crealta Holdings LLC [Member] | Research and Development [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Acquisition related costs | 100,000 | 200,000 | |||||||||||||||||||
Crealta Holdings LLC [Member] | Cost of Goods Sold [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Acquisition related costs | 0 | 400,000 | |||||||||||||||||||
Privately-held life-science entity [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Cash consideration | 1,500,000 | $ 900,000 | 200,000 | ||||||||||||||||||
Payment of option to acquire assets | $ 100,000 | ||||||||||||||||||||
Payment to acquire assets | 25,000,000 | ||||||||||||||||||||
Payment to be made upon attainment of milestones | $ 9,800,000 | ||||||||||||||||||||
Privately-held life-science entity [Member] | Other Assets [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Initial upfront amount | 100,000 | 100,000 | 100,000 | $ 100,000 | |||||||||||||||||
Privately-held life-science entity [Member] | Research and Development [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Cash consideration | 1,500,000 | $ 1,100,000 | $ 1,100,000 | ||||||||||||||||||
PROCYSBI and QUINSAIR [Member] | Raptor Pharmaceutical Corp [Member] | Developed Technology [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Inventory step-up expense including gain on divestiture | 0 | 44,000,000 | |||||||||||||||||||
Inventory step-up expense | 0 | $ 40,800,000 | |||||||||||||||||||
ACTIMMUNE Developed Technology [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Currency exchange rate | € / $ | 1.052 | 1.052 | |||||||||||||||||||
Impairment charge | $ 5,300,000 | € 5 | |||||||||||||||||||
QUINSAIR Developed Technology [Member] | Raptor Pharmaceutical Corp [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Contingent liability | $ 25,500,000 | ||||||||||||||||||||
PROCYSBI Developed Technology [Member] | Developed Technology [Member] | US [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Finite-lived intangible assets estimated useful life | 13 years | ||||||||||||||||||||
PROCYSBI Developed Technology [Member] | Developed Technology [Member] | Non-US [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Finite-lived intangible assets estimated useful life | 9 years | ||||||||||||||||||||
PROCYSBI Developed Technology [Member] | Raptor Pharmaceutical Corp [Member] | Developed Technology [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Present value at discount rate | 12.50% | ||||||||||||||||||||
KRYSTEXXA and MIGERGOT [Member] | Crealta Holdings LLC [Member] | Developed Technology [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Inventory step-up expense | 21,200,000 | $ 11,300,000 | $ 54,900,000 | 27,900,000 | |||||||||||||||||
KRYSTEXXA Developed Technology [Member] | Developed Technology [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Finite-lived intangible assets estimated useful life | 12 years | ||||||||||||||||||||
KRYSTEXXA Developed Technology [Member] | Crealta Holdings LLC [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Net sales | 61,600,000 | ||||||||||||||||||||
KRYSTEXXA Developed Technology [Member] | Crealta Holdings LLC [Member] | Developed Technology [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Present value at discount rate | 27.00% | ||||||||||||||||||||
Inventory step-up expense | 21,200,000 | $ 54,900,000 | |||||||||||||||||||
MIGERGOT Developed Technology [Member] | Developed Technology [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Finite-lived intangible assets estimated useful life | 10 years | ||||||||||||||||||||
MIGERGOT Developed Technology [Member] | Crealta Holdings LLC [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Net sales | $ 3,200,000 | ||||||||||||||||||||
MIGERGOT Developed Technology [Member] | Crealta Holdings LLC [Member] | Developed Technology [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Present value at discount rate | 23.00% | ||||||||||||||||||||
Chiesi Divestiture [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Gain on divestiture of inventory | $ 3,200,000 | ||||||||||||||||||||
Chiesi Divestiture [Member] | PROCYSBI and QUINSAIR [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Gain on divestiture of inventory | 3,200,000 | ||||||||||||||||||||
Disposal Group, Not Discontinued Operations [Member] | Chiesi Divestiture [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Sale of subsidiary for upfront payment | $ 72,200,000 | 72,163,000 | |||||||||||||||||||
Cash divested | $ 3,100,000 | ||||||||||||||||||||
Disposal Group, Not Discontinued Operations [Member] | Chiesi Divestiture [Member] | PROCYSBI and QUINSAIR [Member] | |||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||
Estimated amount of assets expected to be reimbursed | $ 24,800,000 | $ 24,800,000 | $ 27,100,000 |
Divestitures, Acquisitions an47
Divestitures, Acquisitions and Other Arrangements - Gain on Divestiture (Detail) - Disposal Group, Not Discontinued Operations [Member] - Chiesi Divestiture [Member] - USD ($) $ in Thousands | Jun. 23, 2017 | Sep. 30, 2017 | Sep. 30, 2017 |
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||
Cash proceeds | $ 72,200 | $ 72,163 | |
Add reimbursement of royalties | 27,101 | ||
Less net assets sold: | |||
Developed technology | (47,261) | ||
Goodwill | (16,285) | ||
Other | (24,482) | ||
Transaction and other costs | $ 112 | (5,268) | |
Gain on divestiture | $ 112 | $ 5,968 |
Divestitures, Acquisitions an48
Divestitures, Acquisitions and Other Arrangements - Total Consideration for Acquisition Including Cash Acquired (Detail) - USD ($) $ in Thousands | Oct. 25, 2016 | Jan. 13, 2016 |
Raptor Pharmaceutical Corp [Member] | ||
Business Acquisition [Line Items] | ||
Cash | $ 841,494 | |
Net settlements on the exercise of stock options and restricted stock units | 19,268 | |
Total consideration | $ 860,762 | |
Crealta Holdings LLC [Member] | ||
Business Acquisition [Line Items] | ||
Cash | $ 536,206 | |
Net settlements on the exercise of stock options and restricted stock units | 3,526 | |
Total consideration | $ 539,732 |
Divestitures, Acquisitions an49
Divestitures, Acquisitions and Other Arrangements - Fair Values Assigned to Assets Acquired and Liabilities Assumed (Detail) - USD ($) $ in Thousands | Oct. 25, 2016 | Jan. 13, 2016 | Sep. 30, 2017 | Dec. 31, 2016 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 426,441 | $ 445,579 | ||
Raptor Pharmaceutical Corp [Member] | ||||
Business Acquisition [Line Items] | ||||
Accounts payable | (4,572) | |||
Accrued expenses | (24,013) | |||
Accrued trade discounts and rebates | (5,027) | |||
Deferred tax liabilities | (235,423) | |||
Contingent royalty liability | (102,000) | |||
Accrued royalties | (2,705) | |||
Other non-current liability | (25,500) | |||
Cash and cash equivalents | 24,897 | |||
Restricted cash | 1,350 | |||
Accounts receivable, net | 17,767 | |||
Inventories | 74,463 | |||
Prepaid expenses and other current assets | 4,194 | |||
Property and equipment | 3,373 | |||
Other non-current assets | 1,765 | |||
Goodwill | 186,193 | 189,100 | ||
Fair value of consideration paid | $ 860,762 | |||
Raptor Pharmaceutical Corp [Member] | Before [Member] | ||||
Business Acquisition [Line Items] | ||||
Accounts payable | (4,572) | |||
Accrued expenses | (23,773) | |||
Accrued trade discounts and rebates | (6,377) | |||
Deferred tax liabilities | (237,166) | |||
Contingent royalty liability | (102,000) | |||
Accrued royalties | (2,705) | |||
Other non-current liability | (25,500) | |||
Cash and cash equivalents | 24,897 | |||
Restricted cash | 1,350 | |||
Accounts receivable, net | 17,767 | |||
Inventories | 74,463 | |||
Prepaid expenses and other current assets | 4,194 | |||
Property and equipment | 3,373 | |||
Other non-current assets | 1,765 | |||
Goodwill | 189,046 | |||
Fair value of consideration paid | 860,762 | |||
Raptor Pharmaceutical Corp [Member] | Restatement Adjustment [Member] | ||||
Business Acquisition [Line Items] | ||||
Accrued expenses | (240) | |||
Accrued trade discounts and rebates | 1,350 | |||
Deferred tax liabilities | 1,743 | |||
Goodwill | (2,853) | |||
Raptor Pharmaceutical Corp [Member] | Developed Technology [Member] | ||||
Business Acquisition [Line Items] | ||||
Intangible assets | $ 946,000 | |||
Raptor Pharmaceutical Corp [Member] | Developed Technology [Member] | Before [Member] | ||||
Business Acquisition [Line Items] | ||||
Intangible assets | $ 946,000 | |||
Crealta Holdings LLC [Member] | ||||
Business Acquisition [Line Items] | ||||
Accounts payable and accrued expenses | $ (4,543) | |||
Accrued trade discounts and rebates | (1,424) | |||
Deferred tax liabilities | (20,141) | |||
Contingent royalty liability | (51,300) | |||
Other non-current liability | (6,900) | |||
Cash and cash equivalents | 24,893 | |||
Accounts receivable, net | 10,014 | |||
Inventories | 149,363 | |||
Prepaid expenses and other current assets | 1,382 | |||
Other non-current assets | 275 | |||
Goodwill | 9,913 | $ 9,900 | ||
Fair value of consideration paid | 539,732 | |||
Crealta Holdings LLC [Member] | Developed Technology [Member] | ||||
Business Acquisition [Line Items] | ||||
Intangible assets | $ 428,200 |
Divestitures, Acquisitions an50
Divestitures, Acquisitions and Other Arrangements - Consolidated Pro Forma Financial Information (Detail) $ in Thousands | 9 Months Ended |
Sep. 30, 2016USD ($) | |
Business Acquisition [Line Items] | |
Net sales | $ 770,341 |
Net loss | (148,566) |
Before [Member] | |
Business Acquisition [Line Items] | |
Net sales | 670,770 |
Net loss | (36,292) |
Adjustments [Member] | |
Business Acquisition [Line Items] | |
Net sales | 99,571 |
Net loss | $ (112,274) |
Inventories - Components of Inv
Inventories - Components of Inventories (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 17,412 | $ 10,233 |
Work-in-process | 16,230 | 85,022 |
Finished goods | 52,885 | 79,533 |
Inventories, net | $ 86,527 | $ 174,788 |
Inventories - Additional Inform
Inventories - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Inventory [Line Items] | |||||
Finished goods | $ 52,885 | $ 52,885 | $ 79,533 | ||
Work-in-process | 16,230 | 16,230 | 85,022 | ||
Chiesi Divestiture [Member] | |||||
Inventory [Line Items] | |||||
Gain on divestiture of inventory | 3,200 | ||||
PROCYSBI and QUINSAIR [Member] | Chiesi Divestiture [Member] | |||||
Inventory [Line Items] | |||||
Gain on divestiture of inventory | 3,200 | ||||
Crealta Holdings LLC [Member] | KRYSTEXXA Developed Technology [Member] | Developed Technology [Member] | |||||
Inventory [Line Items] | |||||
Finished goods | 40,400 | 40,400 | 27,700 | ||
Work-in-process | 67,600 | ||||
Inventory step-up expense | 21,200 | 54,900 | |||
Crealta Holdings LLC [Member] | KRYSTEXXA and MIGERGOT [Member] | Developed Technology [Member] | |||||
Inventory [Line Items] | |||||
Inventory step-up expense | 21,200 | $ 11,300 | 54,900 | $ 27,900 | |
Raptor Pharmaceutical Corp [Member] | PROCYSBI and QUINSAIR [Member] | Developed Technology [Member] | |||||
Inventory [Line Items] | |||||
Finished goods | 38,100 | ||||
Work-in-process | $ 5,900 | ||||
Inventory step-up expense | $ 0 | $ 40,800 |
Prepaid Expenses and Other Cu53
Prepaid Expenses and Other Current Assets - Prepaid Expenses and Other Current Assets (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract] | ||
Medicine samples inventory | $ 13,374 | $ 10,192 |
Prepaid income taxes | 10,559 | 9,155 |
Rabbi trust assets | 5,717 | 3,073 |
Other prepaid expenses and other current assets | 23,275 | 27,199 |
Prepaid expenses and other current assets | $ 52,925 | $ 49,619 |
Property and Equipment - Proper
Property and Equipment - Property and Equipment (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 34,063 | $ 30,359 |
Less accumulated depreciation | (12,458) | (8,319) |
Property and equipment, net | 21,700 | 23,484 |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 2,260 | 3,069 |
Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 4,931 | 4,566 |
Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 14,786 | 10,876 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 9,397 | 9,184 |
Other [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 2,689 | 2,664 |
Construction in Process [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | $ 95 | 17 |
Software implementation in process [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | $ 1,427 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Property Plant And Equipment [Abstract] | ||||
Depreciation expense | $ 1.5 | $ 1.2 | $ 5 | $ 3.3 |
Goodwill and Intangible Asset56
Goodwill and Intangible Assets - Schedule of Gross Carrying Amount of Goodwill (Detail) $ in Thousands | 9 Months Ended |
Sep. 30, 2017USD ($) | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Beginning balance | $ 445,579 |
Divestiture during the period | (16,285) |
Measurement period adjustments | (2,853) |
Ending balance | $ 426,441 |
Goodwill and Intangible Asset57
Goodwill and Intangible Assets - Additional Information (Detail) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($)Project | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($) | Dec. 08, 2016USD ($) | Jan. 13, 2016USD ($) | |
Finite-Lived Intangible Assets [Line Items] | |||||||
Goodwill, measurement period adjustments | $ (2,853,000) | ||||||
Goodwill | $ 426,441,000 | 426,441,000 | $ 445,579,000 | ||||
Amortization expense of developed technology | 68,700,000 | $ 50,800,000 | $ 208,100,000 | $ 151,200,000 | |||
ACTIMMUNE Developed Technology [Member] | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
In-process research and development | $ 66,000,000 | ||||||
Impairment of acquired in-process R&D | 66,000,000 | ||||||
Developed Technology [Member] | KRYSTEXXA Developed Technology [Member] | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Capitalized intangible asset | 402,200,000 | ||||||
Developed Technology [Member] | MIGERGOT Developed Technology [Member] | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Capitalized intangible asset | 26,000,000 | ||||||
Developed Technology [Member] | PROCYSBI Developed Technology [Member] | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Capitalized intangible asset | 946,000,000 | ||||||
In-Process Research and Development [Member] | ACTIMMUNE Developed Technology [Member] | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Number of projects | Project | 1 | ||||||
Raptor Pharmaceutical Corp [Member] | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Goodwill, measurement period adjustments | $ (2,900,000) | ||||||
Goodwill | 186,193,000 | 186,193,000 | 189,100,000 | ||||
Crealta Holdings LLC [Member] | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Goodwill | $ 9,900,000 | $ 9,913,000 | |||||
Accumulated goodwill impairment losses | $ 0 | 0 | |||||
Disposal Group, Not Discontinued Operations [Member] | Chiesi Divestiture [Member] | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Reduction in goodwill | (16,300,000) | ||||||
Disposal Group, Not Discontinued Operations [Member] | Chiesi Divestiture [Member] | Developed Technology [Member] | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Reduction in net book value | $ 47,300,000 |
Goodwill and Intangible Asset58
Goodwill and Intangible Assets - Amortizable Intangible Assets (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Finite-Lived Intangible Assets [Line Items] | ||
Cost Basis | $ 3,123,795 | $ 3,174,795 |
Accumulated Amortization | (605,740) | (401,360) |
Net Book Value | 2,518,055 | 2,773,435 |
Developed Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost Basis | 3,115,695 | 3,166,695 |
Accumulated Amortization | (603,283) | (399,511) |
Net Book Value | 2,512,412 | 2,767,184 |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost Basis | 8,100 | 8,100 |
Accumulated Amortization | (2,457) | (1,849) |
Net Book Value | $ 5,643 | $ 6,251 |
Goodwill and Intangible Asset59
Goodwill and Intangible Assets - Estimated Future Amortization Expense (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Goodwill And Intangible Assets Disclosure [Abstract] | ||
2017 (October to December) | $ 68,666 | |
2,018 | 274,084 | |
2,019 | 261,092 | |
2,020 | 261,068 | |
2,021 | 253,373 | |
Thereafter | 1,399,772 | |
Net Book Value | $ 2,518,055 | $ 2,773,435 |
Other Assets - Additional Infor
Other Assets - Additional Information (Detail) - USD ($) $ in Millions | Sep. 30, 2017 | Jun. 27, 2017 |
PROCYSBI and QUINSAIR [Member] | Disposal Group, Not Discontinued Operations [Member] | Chiesi Divestiture [Member] | ||
Business Acquisition [Line Items] | ||
Estimated long-term portion of assets expected to be reimbursed | $ 24.8 | $ 27.1 |
Accrued Expenses - Schedule of
Accrued Expenses - Schedule of Accrued Expenses (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Payables And Accruals [Abstract] | ||
Payroll-related expenses | $ 47,730 | $ 66,417 |
Consulting and professional services | 35,660 | 33,614 |
Accrued interest | 26,496 | 18,938 |
Additional payment to be recorded upon closing | 20,000 | |
Accrued other | 32,815 | 31,296 |
Litigation settlement | 32,500 | |
Accrued expenses | $ 162,701 | $ 182,765 |
Accrued Expenses - Additional I
Accrued Expenses - Additional Information (Detail) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Sep. 30, 2017USD ($) | Sep. 30, 2017USD ($) | Dec. 31, 2016USD ($) | |
Schedule Of Accrued Expenses [Line Items] | |||
Accrued payroll-related expenses | $ 47,730 | $ 47,730 | $ 66,417 |
Accrued litigation settlement | 32,500 | ||
Accrued other | 32,815 | 32,815 | 31,296 |
Other long-term liabilities | 67,976 | 67,976 | 46,061 |
Costs to be incurred to discontinue clinical trial | 4,000 | ||
Reduction in research and development expenses | 1,500 | 1,500 | |
Loss on Inventory Purchase Commitments [Member] | |||
Schedule Of Accrued Expenses [Line Items] | |||
Accrued other | 8,500 | 8,500 | 9,500 |
Other long-term liabilities | 2,700 | 2,700 | 4,800 |
Cost to be Incurred in Write-down of Inventory [Member] | |||
Schedule Of Accrued Expenses [Line Items] | |||
Accrued other | 200 | 200 | 4,000 |
Express Scripts, Inc. [Member] | |||
Schedule Of Accrued Expenses [Line Items] | |||
Accrued litigation settlement | $ 32,500 | ||
Litigation settlement number of installment | 2 | ||
Boehringer Ingelheim [Member] | Cost of Goods Sold [Member] | |||
Schedule Of Accrued Expenses [Line Items] | |||
Recorded loss on non-cancellable and unconditional purchase | $ 14,300 | ||
Boehringer Ingelheim [Member] | Loss on Inventory Purchase Commitments [Member] | Cost of Goods Sold [Member] | |||
Schedule Of Accrued Expenses [Line Items] | |||
Recorded reduction in renegotiated purchase commitments | 2,700 | ||
Raptor Pharmaceutical Corp [Member] | Severance and employee costs [Member] | |||
Schedule Of Accrued Expenses [Line Items] | |||
Accrued payroll-related expenses | $ 2,300 | $ 2,300 | $ 15,000 |
Accrued Trade Discounts and R63
Accrued Trade Discounts and Rebates - Schedule of Accrued Trade Discounts and Rebates (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Accrued Wholesaler Fees And Commercial Rebates [Member] | ||
Valuation And Qualifying Accounts Disclosure [Line Items] | ||
Total customer-related accruals and allowances | $ 183,133 | $ 47,460 |
Accrued Co-Pay and Other Patient Assistance [Member] | ||
Valuation And Qualifying Accounts Disclosure [Line Items] | ||
Total customer-related accruals and allowances | 175,991 | 188,504 |
Accrued Government Rebates and Chargebacks [Member] | ||
Valuation And Qualifying Accounts Disclosure [Line Items] | ||
Total customer-related accruals and allowances | 76,590 | 61,592 |
Accrued Trade Discounts and Rebates [Member] | ||
Valuation And Qualifying Accounts Disclosure [Line Items] | ||
Total customer-related accruals and allowances | 435,714 | 297,556 |
Invoiced Wholesaler Fees and Commercial Rebates, Co pay and Other Patient Assistance, and Government Rebates and Chargebacks in Accounts Payable [Member] | ||
Valuation And Qualifying Accounts Disclosure [Line Items] | ||
Total customer-related accruals and allowances | 13,283 | 16,830 |
Customer-related Accruals and Allowances [Member] | ||
Valuation And Qualifying Accounts Disclosure [Line Items] | ||
Total customer-related accruals and allowances | $ 448,997 | $ 314,386 |
Accrued Trade Discounts and R64
Accrued Trade Discounts and Rebates - Schedule of Customer-Related Accruals and Allowances (Detail) $ in Thousands | 9 Months Ended |
Sep. 30, 2017USD ($) | |
Wholesaler Fees and Commercial Rebates [Member] | |
Valuation And Qualifying Accounts Disclosure [Line Items] | |
Beginning Balance | $ 47,651 |
Current provisions relating to sales during the nine months ended September 30, 2017 | 472,118 |
Adjustments relating to prior-year sales | 5,580 |
Payments relating to sales during the nine months ended September 30, 2017 | (288,749) |
Payments relating to prior-year sales | (53,043) |
Ending Balance | 183,557 |
Co-Pay and Other Patient Assistance [Member] | |
Valuation And Qualifying Accounts Disclosure [Line Items] | |
Beginning Balance | 205,143 |
Current provisions relating to sales during the nine months ended September 30, 2017 | 1,406,614 |
Adjustments relating to prior-year sales | (59) |
Payments relating to sales during the nine months ended September 30, 2017 | (1,230,603) |
Payments relating to prior-year sales | (205,084) |
Ending Balance | 176,011 |
Government Rebates and Chargebacks [Member] | |
Valuation And Qualifying Accounts Disclosure [Line Items] | |
Beginning Balance | 61,592 |
Measurement period adjustment | (1,350) |
Current provisions relating to sales during the nine months ended September 30, 2017 | 245,547 |
Adjustments relating to prior-year sales | (4,904) |
Payments relating to sales during the nine months ended September 30, 2017 | (156,118) |
Payments relating to prior-year sales | (55,338) |
Ending Balance | 89,429 |
Customer-related Accruals and Allowances [Member] | |
Valuation And Qualifying Accounts Disclosure [Line Items] | |
Beginning Balance | 314,386 |
Measurement period adjustment | (1,350) |
Current provisions relating to sales during the nine months ended September 30, 2017 | 2,124,279 |
Adjustments relating to prior-year sales | 617 |
Payments relating to sales during the nine months ended September 30, 2017 | (1,675,470) |
Payments relating to prior-year sales | (313,465) |
Ending Balance | $ 448,997 |
Accrued Royalties - Schedule of
Accrued Royalties - Schedule of Changes in Liability for Royalties (Detail) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | |
Business Combinations [Abstract] | ||
Beginning balance | $ 334,274 | |
Reclassification to other long-term liabilities | (5,233) | |
Remeasurement of royalty liabilities | (2,944) | |
Royalty payments | (33,796) | |
Accretion expense | 38,347 | |
Other royalty expense | 297 | |
Ending balance | 330,945 | |
Accrued royalties—current portion | 62,273 | $ 61,981 |
Accrued royalties, net of current | $ 268,672 | $ 272,293 |
Segment and Other Information -
Segment and Other Information - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2017 | |
Customer Concentration Risk [Member] | Sales Revenue [Member] | Minimum [Member] | |
Segment Reporting Information [Line Items] | |
Consolidated receivable/sales percentage to major customers | 10.00% |
Segment and Other Information67
Segment and Other Information - Schedule of Gross Sales from Customers Included in Single Operating Segment (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Segment Reporting Information [Line Items] | ||||
Gross Sales, Amount | $ 1,002,117 | $ 865,850 | $ 3,002,374 | $ 2,350,485 |
Customer Concentration Risk [Member] | Sales Revenue [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Gross Sales, Percentage | 100.00% | 100.00% | 100.00% | 100.00% |
Customer A [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Gross Sales, Amount | $ 314,077 | $ 365,807 | $ 941,268 | $ 1,067,720 |
Customer A [Member] | Customer Concentration Risk [Member] | Sales Revenue [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Gross Sales, Percentage | 31.00% | 42.00% | 31.00% | 45.00% |
Customer B [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Gross Sales, Amount | $ 267,818 | $ 212,392 | $ 856,677 | $ 458,951 |
Customer B [Member] | Customer Concentration Risk [Member] | Sales Revenue [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Gross Sales, Percentage | 27.00% | 25.00% | 29.00% | 20.00% |
Customer C [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Gross Sales, Amount | $ 139,981 | $ 106,360 | $ 423,446 | $ 260,514 |
Customer C [Member] | Customer Concentration Risk [Member] | Sales Revenue [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Gross Sales, Percentage | 14.00% | 12.00% | 14.00% | 11.00% |
Other Customers [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Gross Sales, Amount | $ 280,241 | $ 181,291 | $ 780,983 | $ 563,300 |
Other Customers [Member] | Customer Concentration Risk [Member] | Sales Revenue [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Gross Sales, Percentage | 28.00% | 21.00% | 26.00% | 24.00% |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | ||||
Transfers from level 1 to level 2, assets | $ 0 | $ 0 | $ 0 | $ 0 |
Transfers from level 2 to level 1, assets | 0 | 0 | 0 | 0 |
Transfers of assets into level 3 | 0 | 0 | 0 | 0 |
Transfers of assets out of level 3 | $ 0 | $ 0 | $ 0 | $ 0 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities at Fair Value on Recurring Basis (Detail) - Fair Value Measurements, Recurring Basis [Member] - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets at fair value | $ 560,717 | $ 176,038 |
Total liabilities at fair value | (5,717) | (3,038) |
Bank Time Deposits [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets at fair value | 3,000 | 3,000 |
Money Market Funds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets at fair value | 552,000 | 170,000 |
Other Current Assets [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets at fair value | 5,717 | 3,038 |
Other Long-term Liabilities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities at fair value | (5,717) | (3,038) |
Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets at fair value | 557,717 | 173,038 |
Total liabilities at fair value | (5,717) | (3,038) |
Level 1 [Member] | Money Market Funds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets at fair value | 552,000 | 170,000 |
Level 1 [Member] | Other Current Assets [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets at fair value | 5,717 | 3,038 |
Level 1 [Member] | Other Long-term Liabilities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities at fair value | (5,717) | (3,038) |
Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets at fair value | 3,000 | 3,000 |
Level 2 [Member] | Bank Time Deposits [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets at fair value | $ 3,000 | $ 3,000 |
Debt Agreements - Outstanding D
Debt Agreements - Outstanding Debt Balances (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | ||
Total face value | $ 2,022,875 | $ 1,944,000 |
Debt discount | (113,508) | (126,352) |
Deferred financing fees | (11,790) | (10,155) |
Total long-term debt | 1,897,577 | 1,807,493 |
Less: current maturities | 8,500 | 7,750 |
Long-term debt, net of current maturities | 1,889,077 | 1,799,743 |
2017 Term Loan Facility [Member] | ||
Debt Instrument [Line Items] | ||
Total face value | 847,875 | |
2015 Term Loan Facility [Member] | ||
Debt Instrument [Line Items] | ||
Total face value | 394,000 | |
2024 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Total face value | 300,000 | 300,000 |
2016 Incremental Loan Facility [Member] | ||
Debt Instrument [Line Items] | ||
Total face value | 375,000 | |
Exchangeable Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Total face value | 400,000 | 400,000 |
2023 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Total face value | $ 475,000 | $ 475,000 |
Debt Agreements - Outstanding71
Debt Agreements - Outstanding Debt Balances (Parenthetical) (Detail) | 9 Months Ended |
Sep. 30, 2017 | |
2023 Senior Notes [Member] | |
Debt Instrument [Line Items] | |
Maturity date of debt instrument | May 1, 2023 |
2024 Senior Notes [Member] | |
Debt Instrument [Line Items] | |
Maturity date of debt instrument | Nov. 1, 2024 |
2017 Term Loan Facility [Member] | |
Debt Instrument [Line Items] | |
Maturity date of debt instrument | Mar. 29, 2017 |
2015 Term Loan Facility [Member] | |
Debt Instrument [Line Items] | |
Maturity date of debt instrument | May 7, 2015 |
2016 Incremental Loan Facility [Member] | |
Debt Instrument [Line Items] | |
Maturity date of debt instrument | Oct. 25, 2016 |
Debt Agreements - Additional In
Debt Agreements - Additional Information (Detail) | Mar. 29, 2017USD ($) | Oct. 25, 2016USD ($) | May 07, 2015USD ($) | Apr. 29, 2015USD ($) | Sep. 30, 2017USD ($)d$ / shares | Dec. 31, 2016USD ($) | Mar. 13, 2015USD ($) |
Debt Instrument [Line Items] | |||||||
Loss on debt extinguishment | $ (388,000) | ||||||
Senior notes | 1,578,947,000 | $ 1,501,741,000 | |||||
Initial debt discount | 113,508,000 | $ 126,352,000 | |||||
Exchangeable Senior Notes [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, fair value | $ 361,000,000 | ||||||
Interest rate | 2.50% | ||||||
Maturity date of debt instrument | Mar. 15, 2022 | ||||||
Redemption price as percentage of aggregate principal amount | 100.00% | ||||||
Debt Instrument, Convertible, Conversion Ratio (in shares per $1,000 principal amount) | 34.8979 | ||||||
Debt Instrument, Convertible, Conversion Price (in dollars per share) | $ / shares | $ 28.66 | ||||||
Debt instrument convertible minimum percentage | 130.00% | ||||||
Debt instrument number of trading days | d | 20 | ||||||
Debt instrument consecutive trading days | d | 30 | ||||||
Carrying amount of liability component | $ 268,900,000 | ||||||
Carrying amount of equity component | 119,100,000 | ||||||
Initial proceeds from convertible debt instrument | 387,200,000 | ||||||
Initial debt discount | $ 131,100,000 | ||||||
Exchangeable Senior Notes [Member] | Conversion Condition One [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument convertible minimum percentage | 130.00% | ||||||
Debt instrument number of trading days | d | 20 | ||||||
Debt instrument consecutive trading days | d | 30 | ||||||
Exchangeable Senior Notes [Member] | Conversion Condition Two [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument number of trading days | d | 5 | ||||||
Debt instrument consecutive trading days | d | 10 | ||||||
Convertible senior notes, principal payment | $ 1,000 | ||||||
Debt instrument convertible maximum percentage | 98.00% | ||||||
Exchangeable Senior Notes [Member] | Horizon Investment [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Senior notes | $ 400,000,000 | ||||||
Net proceeds from senior notes | $ 387,200,000 | ||||||
Interest rate | 2.50% | ||||||
2024 Senior Notes [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, fair value | $ 313,500,000 | ||||||
Interest rate | 8.75% | ||||||
Maturity date of debt instrument | Nov. 1, 2024 | ||||||
Debt instrument redemption description | the 2024 Senior Notes may be redeemed at any time at specified redemption prices, plus accrued and unpaid interest to the redemption date. At any time prior to November 1, 2019, some or all of the 2024 Senior Notes may be redeemed at a price equal to 100% of the aggregate principal amount thereof, plus a make-whole premium and accrued and unpaid interest to the redemption date. Also prior to November 1, 2019, up to 35% of the aggregate principal amount of the 2024 Senior Notes may be redeemed at a redemption price of 108.75% of the aggregate principal amount thereof, plus accrued and unpaid interest, with the net proceeds of certain equity offerings. In addition, the 2024 Senior Notes may be redeemed in whole but not in part at a redemption price equal to 100% of the principal amount plus accrued and unpaid interest and additional amounts, if any, to, but excluding, the redemption date, if on the next date on which any amount would be payable in respect of the 2024 Senior Notes, the 2024 Issuers or any guarantor is or would be required to pay additional amounts as a result of certain tax-related events. | ||||||
2024 Senior Notes [Member] | Prior to November 1, 2019 [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Redemption price as percentage of aggregate principal amount | 108.75% | ||||||
2024 Senior Notes [Member] | Prior to November 1, 2019, Some or All of Aggregate Principal Amount [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Redemption price as percentage of aggregate principal amount | 100.00% | ||||||
2024 Senior Notes [Member] | After November 1, 2019, in Whole But Not in Part [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Redemption price as percentage of aggregate principal amount | 100.00% | ||||||
2023 Senior Notes [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, fair value | $ 464,300,000 | ||||||
Interest rate | 6.625% | ||||||
Maturity date of debt instrument | May 1, 2023 | ||||||
Debt instrument redemption description | the 2023 Senior Notes may be redeemed at any time at specified redemption prices, plus accrued and unpaid interest to the redemption date. At any time prior to May 1, 2018, some or all of the 2023 Senior Notes may be redeemed at a price equal to 100% of the aggregate principal amount thereof, plus a make-whole premium and accrued and unpaid interest to the redemption date. Also prior to May 1, 2018, up to 35% of the aggregate principal amount of the 2023 Senior Notes may be redeemed at a redemption price of 106.625% of the aggregate principal amount thereof, plus accrued and unpaid interest, with the net proceeds of certain equity offerings. In addition, the 2023 Senior Notes may be redeemed in whole but not in part at a redemption price equal to 100% of the principal amount plus accrued and unpaid interest and additional amounts, if any, to, but excluding, the redemption date, if on the next date on which any amount would be payable in respect of the 2023 Senior Notes, HPI or any guarantor is or would be required to pay additional amounts as a result of certain tax-related events. | ||||||
2023 Senior Notes [Member] | Prior to May 1, 2018 [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Redemption price as percentage of aggregate principal amount | 106.625% | ||||||
2023 Senior Notes [Member] | Prior to May 1, 2018, Some or All of Aggregate Principal Amount [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Redemption price as percentage of aggregate principal amount | 100.00% | ||||||
2023 Senior Notes [Member] | After May 1, 2018, in Whole But Not in Part [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Redemption price as percentage of aggregate principal amount | 100.00% | ||||||
Maximum [Member] | 2024 Senior Notes [Member] | Prior to November 1, 2019 [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Redemption amount as percentage of aggregate principal amount | 35.00% | ||||||
Maximum [Member] | 2023 Senior Notes [Member] | Prior to May 1, 2018 [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Redemption amount as percentage of aggregate principal amount | 35.00% | ||||||
2017 Term Loan Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
LIBOR floor rate | 1.00% | ||||||
Interest rate description | The March 2017 Refinancing Loans bore interest, at the Borrowers’ option, at a rate equal to either the London Inter-Bank Offer Rate (“LIBOR”), plus an applicable margin of 3.75% per year (subject to a LIBOR floor of 1.00%), or the adjusted base rate plus 2.75%. The adjusted base rate was defined as the greater of (a) LIBOR (using one-month interest period) plus 1.00%, (b) prime rate, (c) fed funds plus 0.5%, and (d) 2.00%. | ||||||
Repayment of refinanced loans, amount | $ 769,000,000 | ||||||
Cut off percentage for defining limited liability subsidiaries, portion of capital stock held maximum | 65.00% | ||||||
Proceeds from debt issuances, percentage on excess cash flow | 50.00% | ||||||
Proceeds from debt issuances, reduction percentage on excess cash flow | 25.00% | ||||||
Proceeds from debt issuances, percentage on first lien leverage ratio | 0.00% | ||||||
Principal amount of loan, amortization percentage | 1.00% | ||||||
Credit agreement, description | The Borrowers were required to make mandatory prepayments of loans under the March 2017 Credit Agreement (without payment of a premium) with (a) net cash proceeds from certain non-ordinary course asset sales (subject to reinvestment rights and other exceptions), (b) casualty proceeds and condemnation awards (subject to reinvestment rights and other exceptions), (c) net cash proceeds from issuances of debt (other than certain permitted debt), and (d) 50% of the Company’s excess cash flow (subject to decrease to 25% or 0% if the Company’s first lien leverage ratio is less than 2.25:1 or 1.75:1, respectively). The March 2017 Refinancing Loans amortized in equal quarterly installments beginning on June 30, 2017 in an aggregate annual amount equal to 1.00% of the original principal amount thereof, with any remaining balance payable on March 29, 2024, the final maturity date of the March 2017 Refinancing Loans. | ||||||
Maturity date of debt instrument | Mar. 29, 2017 | ||||||
2017 Term Loan Facility [Member] | Maximum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
First lien leverage ratio | 225.00% | ||||||
2017 Term Loan Facility [Member] | Minimum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
First lien leverage ratio | 175.00% | ||||||
2017 Term Loan Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument variable rate | 3.75% | ||||||
2017 Term Loan Facility [Member] | Adjusted Base Rate [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument variable rate | 2.75% | ||||||
2015 Term Loan Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
LIBOR floor rate | 1.00% | 1.00% | |||||
Interest rate description | The 2015 Loans under the 2015 Term Loan Facility bore interest, at each borrower’s option, at a rate equal to either the LIBOR, plus an applicable margin of 3.50% per year (subject to a 1.00% LIBOR floor), or the adjusted base rate plus 2.50%. The adjusted base rate was defined as the greater of (a) LIBOR (using one-month interest period) plus 1.00%, (b) prime rate, (c) fed funds plus 0.5%, and (d) 2.00%. HPI borrowed the full $400.0 million available on the 2015 Term Loan Facility on May 7, 2015 as a LIBOR-based borrowing. | ||||||
Line of credit facility maximum borrowing capacity | $ 400,000,000 | ||||||
Percentage on incremental loans effective yield maximum deduction | 0.50% | ||||||
Debt instrument effective yield percentage | 5.00% | ||||||
Maturity date of debt instrument | May 7, 2015 | ||||||
2015 Term Loan Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit facility borrowing capacity | $ 400,000,000 | ||||||
Debt instrument variable rate | 4.00% | 3.50% | |||||
2015 Term Loan Facility [Member] | Adjusted Base Rate [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument variable rate | 2.50% | ||||||
2016 Incremental Loan Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
LIBOR floor rate | 1.00% | ||||||
Maturity date of debt instrument | Oct. 25, 2016 | ||||||
2016 Incremental Loan Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument variable rate | 4.50% | ||||||
2016 Incremental Loan Facility [Member] | Adjusted Base Rate [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument variable rate | 3.50% | ||||||
2016 Incremental Loan Facility and 2015 Term Loan Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Repayment of refinanced loans, amount | $ 769,000,000 | ||||||
Loss on debt extinguishment | $ (500,000) | ||||||
Prepayment penalty fee percentage | 1.00% | ||||||
Incremental of debt discount and deferred financing fees capitalized | $ 5,800,000 | ||||||
Horizon Pharma USA Inc [Member] | 2024 Senior Notes [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Senior notes | $ 300,000,000 | ||||||
Net proceeds from senior notes | $ 291,900,000 | ||||||
Maturity date of debt instrument | Nov. 1, 2024 | ||||||
Debt instrument redemption description | If the Company undergoes a change of control, the 2024 Issuers will be required to make an offer to purchase all of the 2024 Senior Notes at a price in cash equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest to, but not including, the repurchase date. If the Company or certain of its subsidiaries engages in certain asset sales, the 2024 Issuers will be required under certain circumstances to make an offer to purchase the 2024 Senior Notes at 100% of the principal amount thereof, plus accrued and unpaid interest to the repurchase date. | ||||||
Redemption price percentage of principal amount of debt instrument on change of control | 101.00% | ||||||
Horizon Pharma USA Inc [Member] | March 2017 Refinancing Loans [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit facility borrowing capacity | $ 850,000,000 | ||||||
Horizon Pharma USA Inc [Member] | 2016 Incremental Loan Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit facility borrowing capacity | $ 375,000,000 | ||||||
Hyperion Therapeutics, Inc. [Member] | 2023 Senior Notes [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Maturity date of debt instrument | May 1, 2023 | ||||||
Debt instrument redemption description | If the Company undergoes a change of control, HPI will be required to make an offer to purchase all of the 2023 Senior Notes at a price in cash equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest to, but not including, the repurchase date. If the Company or certain of its subsidiaries engages in certain asset sales, HPI will be required under certain circumstances to make an offer to purchase the 2023 Senior Notes at 100% of the principal amount thereof, plus accrued and unpaid interest to the repurchase date. | ||||||
Redemption price percentage of principal amount of debt instrument on change of control | 101.00% | ||||||
Hyperion Therapeutics, Inc. [Member] | 2017 Term Loan Facility [Member] | 2017 Offering [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, fair value | $ 847,900,000 | ||||||
Raptor Pharmaceutical Corp [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, term loan facility | 375,000,000 | ||||||
Raptor Pharmaceutical Corp [Member] | 2024 Senior Notes [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Senior notes | $ 300,000,000 | ||||||
Interest rate | 8.75% | ||||||
Raptor Pharmaceutical Corp [Member] | 2016 Incremental Loan Facility [Member] | 2024 Senior Notes [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, term loan facility | $ 375,000,000 | ||||||
Horizon Pharma Financing Inc. [Member] | 2023 Senior Notes [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Senior notes | $ 475,000,000 | ||||||
Net proceeds from senior notes | $ 462,300,000 | ||||||
Interest rate | 6.625% |
Other Long-Term Liabilities - A
Other Long-Term Liabilities - Additional Information (Detail) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Other Long-term Liabilities [Member] | PROCYSBI and QUINSAIR [Member] | ||
Other Long Term Liabilities [Line Items] | ||
Fair value of long-term portion of contingent liability for royalties potentially payable | $ 26.6 | $ 25.5 |
Commitments and Contingencies -
Commitments and Contingencies - Schedule of Office Space Lease Agreements in Place for Real Properties (Detail) - ft² | 9 Months Ended | |||
Sep. 30, 2017 | Jun. 30, 2017 | |||
Dublin Office [Member] | ||||
Loss Contingencies [Line Items] | ||||
Approximate Square Feet | 18,900 | |||
Lease Expiry Date | Nov. 3, 2029 | |||
Lake Forest Office [Member] | ||||
Loss Contingencies [Line Items] | ||||
Approximate Square Feet | [1] | 160,000 | ||
Lease Expiry Date | [1] | Mar. 31, 2024 | ||
Novato Office [Member] | ||||
Loss Contingencies [Line Items] | ||||
Approximate Square Feet | [2] | 61,000 | ||
Lease Expiry Date | [2] | Aug. 31, 2021 | ||
Deerfield Office [Member] | ||||
Loss Contingencies [Line Items] | ||||
Approximate Square Feet | 32,300 | [3] | 32,300 | |
Lease Expiry Date | [3] | Jun. 30, 2018 | ||
Brisbane Office [Member] | ||||
Loss Contingencies [Line Items] | ||||
Approximate Square Feet | 20,100 | |||
Lease Expiry Date | Nov. 30, 2019 | |||
Mannheim Office [Member] | ||||
Loss Contingencies [Line Items] | ||||
Approximate Square Feet | 14,300 | |||
Lease Expiry Date | Dec. 31, 2018 | |||
Chicago Office [Member] | ||||
Loss Contingencies [Line Items] | ||||
Approximate Square Feet | 6,500 | |||
Lease Expiry Date | Dec. 31, 2018 | |||
Reinach Office [Member] | ||||
Loss Contingencies [Line Items] | ||||
Approximate Square Feet | 3,500 | |||
Lease Expiry Date | May 31, 2020 | |||
Washington, D.C. Office [Member] | ||||
Loss Contingencies [Line Items] | ||||
Approximate Square Feet | 1,000 | |||
Lease Expiry Date | Dec. 31, 2018 | |||
[1] | In connection with the Lake Forest, Illinois lease, the Company has provided a $2.0 million letter of credit to the landlord, through a commercial bank. | |||
[2] | During March 2017, the Company vacated an area of the office space in Novato, California. During March and April 2017, the Company entered into sublease arrangements for this space with third parties. | |||
[3] | During January 2016, the Company vacated the premises in Deerfield, Illinois and began occupying the premises in Lake Forest, Illinois. During April 2017, the Company entered into a sublease arrangement for a portion of this space with a third party. During June 2017, the Company terminated a portion of the lease, resulting in 32,300 square feet remaining. |
Commitments and Contingencies75
Commitments and Contingencies - Schedule of Office Space Lease Agreements in Place for Real Properties (Parenthetical) (Detail) $ in Millions | Sep. 30, 2017USD ($)ft² | Jun. 30, 2017ft² | ||
Lake Forest Office [Member] | ||||
Loss Contingencies [Line Items] | ||||
Letter of credit | $ | $ 2 | |||
Approximate Square Feet | [1] | 160,000 | ||
Deerfield Office [Member] | ||||
Loss Contingencies [Line Items] | ||||
Approximate Square Feet | 32,300 | [2] | 32,300 | |
[1] | In connection with the Lake Forest, Illinois lease, the Company has provided a $2.0 million letter of credit to the landlord, through a commercial bank. | |||
[2] | During January 2016, the Company vacated the premises in Deerfield, Illinois and began occupying the premises in Lake Forest, Illinois. During April 2017, the Company entered into a sublease arrangement for a portion of this space with a third party. During June 2017, the Company terminated a portion of the lease, resulting in 32,300 square feet remaining. |
Commitments and Contingencies76
Commitments and Contingencies - Additional Information (Detail) | May 08, 2017USD ($) | Nov. 08, 2016USD ($) | Nov. 30, 2013USD ($) | Sep. 30, 2017USD ($)$ / € | Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($)€ / $ | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($)$ / € | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($)€ / $ | May 08, 2017CHF (SFr) |
Loss Contingencies [Line Items] | |||||||||||
Royalty and royalty accretion expense | $ 15,000,000 | $ 42,100,000 | |||||||||
River Vision [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Maximum payment to be made upon attainment of milestones | $ 325,000,000 | SFr 103,000,000 | |||||||||
Cash consideration | 151,900,000 | ||||||||||
Cash acquired from acquisition | $ 6,300,000 | ||||||||||
Percentage of net sales in earn-out payment | 3.00% | ||||||||||
Net sales minimum limit for royal payment | $ 300,000,000 | ||||||||||
Cost of Goods Sold [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Royalty and royalty accretion expense | 14,900,000 | $ 11,200,000 | 42,000,000 | $ 32,600,000 | |||||||
Selling, General and Administrative [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Royalty and royalty accretion expense | 100,000 | 100,000 | |||||||||
Minimum [Member] | River Vision [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Percentage of net sales in earn-out payment | 9.00% | ||||||||||
Maximum [Member] | River Vision [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Percentage of net sales in earn-out payment | 12.00% | ||||||||||
ACTIMMUNE Developed Technology [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Currency exchange rate | € / $ | 1.052 | 1.052 | |||||||||
BUPHENYL, MIGERGOT, QUINSAIR and RAVICTI and VIMOVO [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Purchase and other commitments outstanding purchase orders | 9,600,000 | $ 9,600,000 | |||||||||
Boehringer Ingelheim [Member] | Cost of Goods Sold [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Recorded loss on non-cancellable and unconditional purchase commitments | $ 14,300,000 | ||||||||||
Manufacturing and Supply Agreement [Member] | Jagotec AG [Member] | LODOTRA /RAYOS [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Manufacturing and supply agreement initiation date | 2007-08 | ||||||||||
Purchase commitment expiration date | Dec. 31, 2023 | ||||||||||
Minimum binding purchase commitment | $ 6,700,000 | ||||||||||
Purchase commitment outstanding purchase orders | $ 1,200,000 | $ 1,200,000 | |||||||||
Manufacturing and Supply Agreement [Member] | Sanofi-Aventis U.S [Member] | DUEXIS [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Manufacturing and supply agreement initiation date | 2011-05 | ||||||||||
Minimum binding purchase commitment | $ 6,300,000 | ||||||||||
Term of agreement expiration month and year | 2019-05 | ||||||||||
Term of agreement automatically renewal period | 2 years | ||||||||||
Written notice period for termination of agreement | 2 years | ||||||||||
Manufacturing and Supply Agreement [Member] | Boehringer Ingelheim [Member] | ACTIMMUNE Developed Technology [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Manufacturing and supply agreement initiation date | 2013-07 | ||||||||||
Minimum binding purchase commitment | $ 22,500,000 | ||||||||||
Currency exchange rate | $ / € | 1.1814 | 1.1814 | |||||||||
Recorded loss on non-cancellable and unconditional purchase commitments | 14,300,000 | ||||||||||
Reduction in cost of goods sold | $ 2,700,000 | ||||||||||
Additional costs committed to be incurred for harmonization of drug substance manufacturing process | $ 14,900,000 | ||||||||||
Costs related to harmonization of drug substance manufacturing process | $ 5,700,000 | $ 12,200,000 | |||||||||
Manufacturing and Supply Agreement [Member] | Patheon Pharmaceuticals Inc. [Member] | Vimovo [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Manufacturing and supply agreement initiation date | 2013-11 | ||||||||||
Minimum binding purchase commitment | $ 1,500,000 | ||||||||||
Manufacturing and Supply Agreement [Member] | Patheon Pharmaceuticals Inc. [Member] | PROCYSBI Developed Technology [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Manufacturing and supply agreement initiation date | 2010-11 | ||||||||||
Minimum binding purchase commitment | $ 1,400,000 | ||||||||||
Supply agreement expiry date | Dec. 31, 2019 | ||||||||||
Manufacturing and Supply Agreement [Member] | Nuvo Research Inc. [Member] | PENNSAID 2% [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Manufacturing and supply agreement initiation date | 2014-10 | ||||||||||
Minimum binding purchase commitment | $ 4,300,000 | ||||||||||
Supply agreement expiry date | Dec. 31, 2029 | ||||||||||
Manufacturing and Supply Agreement [Member] | Cambrex [Member] | PROCYSBI API [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Manufacturing and supply agreement initiation date | 2010-11 | ||||||||||
Minimum binding purchase commitment | $ 2,800,000 | ||||||||||
Supply agreement expiry date | Nov. 30, 2020 | ||||||||||
Manufacturing and Supply Agreement [Member] | Bio-Technology General (Israel) Ltd [Member] | KRYSTEXXA Developed Technology [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Manufacturing and supply agreement initiation date | 2007-03 | ||||||||||
Minimum binding purchase commitment | $ 52,000,000 | ||||||||||
Term of agreement automatically renewal period | 3 years | ||||||||||
Written notice period for termination of agreement | 3 years | ||||||||||
Supply agreement expiry date | Dec. 31, 2030 | ||||||||||
Expected early termination period of agreement due to uncertain event | Jan. 1, 2024 | ||||||||||
Other commitment | 1,800,000 | $ 1,800,000 | |||||||||
Manufacturing and Supply Agreement [Member] | Bio-Technology General (Israel) Ltd [Member] | KRYSTEXXA Developed Technology [Member] | Minimum [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Purchase obligation percentage | 80.00% | ||||||||||
License Agreement [Member] | Aralez Pharmaceuticals Inc. [Member] | Vimovo and Other Medicines [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Percentage of royalty on net sales | 10.00% | ||||||||||
Minimum annual royalty obligations | 7,500,000 | $ 7,500,000 | |||||||||
Royalty expiration period upon first commercial sale in United States | 10 years | ||||||||||
License Agreement [Member] | Genentech Inc [Member] | ACTIMMUNE Developed Technology [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Net sales threshold | $ 3,700,000 | ||||||||||
License Agreement [Member] | Genentech Inc [Member] | ACTIMMUNE Developed Technology [Member] | Minimum [Member] | For First 3.7 Million in Net Sales [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Percentage of royalty on net sales | 20.00% | ||||||||||
License Agreement [Member] | Genentech Inc [Member] | ACTIMMUNE Developed Technology [Member] | Minimum [Member] | For All Additional Net Sales [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Percentage of royalty on net sales | 1.00% | ||||||||||
License Agreement [Member] | Genentech Inc [Member] | ACTIMMUNE Developed Technology [Member] | Maximum [Member] | For First 3.7 Million in Net Sales [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Percentage of royalty on net sales | 30.00% | ||||||||||
License Agreement [Member] | Genentech Inc [Member] | ACTIMMUNE Developed Technology [Member] | Maximum [Member] | For All Additional Net Sales [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Percentage of royalty on net sales | 9.00% | ||||||||||
License Agreement [Member] | Duke [Member] | KRYSTEXXA Developed Technology [Member] | Minimum [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Percentage of royalty on net sales revenue | 5.00% | ||||||||||
License Agreement [Member] | Duke [Member] | KRYSTEXXA Developed Technology [Member] | Maximum [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Percentage of royalty on net sales revenue | 15.00% | ||||||||||
License Agreement [Member] | MVP [ Member] | KRYSTEXXA Developed Technology [Member] | Minimum [Member] | Non-US [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Percentage of royalty on net sales revenue | 5.00% | ||||||||||
License Agreement [Member] | MVP [ Member] | KRYSTEXXA Developed Technology [Member] | Maximum [Member] | Non-US [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Percentage of royalty on net sales revenue | 15.00% | ||||||||||
Letter Agreement [Member] | Aralez Pharmaceuticals Inc. [Member] | Vimovo [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Aggregate milestone payment amount | $ 260,000,000 | ||||||||||
Letter Agreement [Member] | Aralez Pharmaceuticals Inc. [Member] | Vimovo [Member] | Minimum [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Annual aggregate net sales thresholds amount | 550,000,000 | ||||||||||
Letter Agreement [Member] | Aralez Pharmaceuticals Inc. [Member] | Vimovo [Member] | Maximum [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Annual aggregate net sales thresholds amount | $ 1,250,000,000 | ||||||||||
Collaboration and Option Agreement [Member] | Privately-held life-science entity [Member] | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Payment of option to acquire assets | $ 100,000 | ||||||||||
Payment to acquire assets | 25,000,000 | ||||||||||
Maximum payment to be made upon attainment of milestones | $ 9,800,000 | ||||||||||
Cash consideration | $ 1,500,000 | $ 900,000 | $ 200,000 |
Legal Proceedings - Additional
Legal Proceedings - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2017 | |
Legal Proceedings Related to RAYOS [Member] | Actavis Settlement Agreement [Member] | |
Legal Proceedings [Line Items] | |
Settlement and license agreement date | Oct. 1, 2015 |
Non-exclusive license agreement term | 180 days |
License agreement generic entry date | Dec. 23, 2022 |
Legal Proceedings Related to PENNSAID 2% [Member] | Perrigo Settlement Agreement [Member] | |
Legal Proceedings [Line Items] | |
Settlement and license agreement date | May 6, 2015 |
Effective date of settlement and license agreement | January 10, 2029 |
Legal Proceedings Related to PENNSAID 2% [Member] | Taro Settlement Agreement [Member] | |
Legal Proceedings [Line Items] | |
Settlement and license agreement date | Sep. 9, 2015 |
Effective date of settlement and license agreement | January 10, 2029 |
Legal Proceedings Related to PENNSAID 2% [Member] | Teligent Settlement Agreement [Member] | |
Legal Proceedings [Line Items] | |
Settlement and license agreement date | May 9, 2016 |
Effective date of settlement and license agreement | January 10, 2029 |
Legal Proceedings Related to PENNSAID 2% [Member] | Amneal settlement agreement [Member] | |
Legal Proceedings [Line Items] | |
Settlement and license agreement date | Apr. 18, 2016 |
Effective date of settlement and license agreement | January 10, 2029 |
Legal Proceedings Related to RAVICTI [Member] | U.S. Patent No. 8,404,215 [Member] | |
Legal Proceedings [Line Items] | |
Expiry of patent | 2032-03 |
Legal Proceedings Related to RAVICTI [Member] | U.S. Patent No. 8,642,012 [Member] | |
Legal Proceedings [Line Items] | |
Expiry of patent | 2030-09 |
Legal Proceedings Related to RAVICTI [Member] | U.S. Patent No. 5,968,979 [Member] | |
Legal Proceedings [Line Items] | |
Expired date of patent | Feb. 7, 2015 |
Extended Expiry date of patent | Feb. 7, 2016 |
Final extension term granted by USPTO | 1267 days |
Shareholders' Equity - Addition
Shareholders' Equity - Additional Information (Detail) - USD ($) $ in Thousands | 9 Months Ended | |||||
Sep. 30, 2017 | Sep. 30, 2016 | May 31, 2017 | Jan. 01, 2017 | Dec. 31, 2016 | May 31, 2016 | |
Subsidiary, Sale of Stock [Line Items] | ||||||
Shares issued in connection with the exercise of stock options | 270,427 | |||||
Proceeds from exercise of stock options | $ 1,762 | $ 3,384 | ||||
Ordinary shares issued | 164,242,005 | 162,004,956 | ||||
Number of warrants exercised | 391,500 | |||||
Ordinary shares issuance in cashless exercises | 523,520 | |||||
Additional number of warrants exercised | 704,285 | |||||
Proceeds from exercises of warrants | $ 1,789 | |||||
Number of warrants outstanding | 0 | |||||
Payments for employee withholding taxes related to share-based payment | $ 5,640 | $ 5,309 | ||||
Effect of ASU 2016-09 adoption on tax benefits | (1,205,880) | $ (848,021) | ||||
Total consideration for repurchase of ordinary shares, value | $ 992 | |||||
ASU 2016-09 [Member] | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Effect of ASU 2016-09 adoption on tax benefits | $ 7,200 | |||||
2016 Repurchase Program [Member] | Maximum [Member] | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Shares authorized under repurchase program | 5,000,000 | |||||
2017 Repurchase Program [Member] | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Shares repurchased during period | 100,000 | |||||
Total consideration for repurchase of ordinary shares, value | $ 1,000 | |||||
2017 Repurchase Program [Member] | Maximum [Member] | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Shares authorized under repurchase program | 16,000,000 | |||||
Employee Stock Purchase Plans [Member] | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Ordinary shares issued | 462,472 | |||||
Proceeds in connection with issuance of ordinary shares | $ 3,900 | |||||
Payments for employee withholding taxes related to share-based payment | $ 5,600 | |||||
Restricted Stock Units [Member] | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Ordinary shares issued | 660,092 | |||||
Performance Stock Units [Member] | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Ordinary shares issued | 25,000 |
Share-Based Incentive Plans - A
Share-Based Incentive Plans - Additional Information (Detail) - USD ($) | Aug. 29, 2017 | May 03, 2016 | Feb. 25, 2016 | Mar. 23, 2015 | Jul. 28, 2011 | Nov. 04, 2017 | Sep. 30, 2017 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | Nov. 05, 2014 | May 17, 2014 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Options, Granted | 2,020,017 | |||||||||||
Stock options contractual term | 10 years | |||||||||||
Share-based compensation expense | $ 87,935,000 | $ 84,921,000 | ||||||||||
Expected volatility assumption based on historical volatility, in percentage | 49.10% | 73.80% | ||||||||||
Tax benefit recognized from stock-based compensation expense | $ 0 | |||||||||||
Tax benefits realized from stock options exercised and vested restricted stock units | 0 | |||||||||||
Pre-tax unrecognized compensation expense for all unvested share-based awards | $ 156,500,000 | $ 156,500,000 | ||||||||||
ASU 2016-09 [Member] | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Tax benefit recognized from stock-based compensation expense | 0 | 0 | ||||||||||
Tax benefits realized from stock options exercised and vested restricted stock units | $ 0 | $ 0 | ||||||||||
Cash Long-Term Incentive Program [Member] | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Trading days | 20 days | |||||||||||
Implied 20-day VWAP | $ 18.37 | |||||||||||
Bonus payable under cash bonus program | $ 15,800,000 | |||||||||||
Cash Bonus Program, description | Participants in the Cash Bonus Program were eligible for a specified cash bonus. The Cash Bonus Program pool funding of approximately $15.8 million was determined based on the Company’s actual TSR over the period from November 5, 2014 to May 6, 2015, and the bonus could be earned and payable only if the TSR for the period from November 5, 2014 to November 4, 2017 was greater than 15%. The portion of the total bonus pool payable to individual participants was based on allocations established by the Company’s compensation committee. Participants must have remained employed by the Company through November 4, 2017 unless a participant’s earlier departure from employment was due to death, disability, termination without cause or a change in control transaction. Bonus payments under the Cash Bonus Program, if any, were to be made after November 4, 2017. Subsequent to September 30, 2017, the TSR did not exceed the minimum target requirement of 15% and the Cash Bonus Program expired without payment. | |||||||||||
Estimated fair value of award | $ 0 | $ 4,800,000 | ||||||||||
Reduction in expense related to cash bonus program | $ 3,500,000 | |||||||||||
Valuation date stock price | $ 12.68 | $ 12.68 | ||||||||||
Expected volatility assumption based on historical volatility, in percentage | 38.00% | |||||||||||
Expected volatility assumption based on historical volatility, in Years | 1 month 7 days | |||||||||||
Risk free rate | 1.07% | |||||||||||
Risk free rate remaining term | 1 month 7 days | |||||||||||
Cash Long-Term Incentive Program [Member] | Subsequent Event [Member] | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
TSR, minimum target requirement percentage | 15.00% | |||||||||||
Performance Stock Units [Member] | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Trading days | 20 days | |||||||||||
Implied 20-day VWAP | $ 21.50 | |||||||||||
Share-based compensation expense | $ 37,000,000 | $ 36,100,000 | ||||||||||
Performance Stock Units [Member] | Members of Executive Committee [Member] | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
One year mandatory post vest holding period percentage | 50.00% | |||||||||||
Two year mandatory post vest holding period percentage | 50.00% | |||||||||||
Performance Stock Units [Member] | Non-Executive Committee Members [Member] | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
One year mandatory post vest holding period percentage | 50.00% | |||||||||||
Maximum [Member] | Performance Stock Units [Member] | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Percentage of outstanding PSU award vesting amount range | 100.00% | |||||||||||
Valuation date stock price | $ 21.07 | |||||||||||
Minimum [Member] | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Cash bonus payment date | Nov. 4, 2017 | |||||||||||
Minimum [Member] | Cash Long-Term Incentive Program [Member] | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Cash Bonus Program, percentage | 15.00% | |||||||||||
Minimum [Member] | Performance Stock Units [Member] | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Percentage of outstanding PSU award vesting amount range | 25.00% | |||||||||||
Valuation date stock price | $ 17.72 | |||||||||||
2014 ESPP [Member] | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Reduction in number of shares authorized for issuance | 5,000,000 | 5,000,000 | ||||||||||
Common stock shares authorized | 3,361,928 | 3,361,928 | ||||||||||
Common stock shares reserved for future issuance | 3,361,928 | 3,361,928 | ||||||||||
2005 Plan [Member] | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Options, Granted | 0 | |||||||||||
2014 EIP [Member] | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Common stock shares authorized | 3,819,449 | 3,819,449 | 15,500,000 | |||||||||
Common stock shares reserved for future issuance | 3,819,449 | 3,819,449 | ||||||||||
Common stock shares, number of additional shares authorized | 1,200,000 | 6,000,000 | 14,000,000 | |||||||||
2014 EIP [Member] | 2017 Inducement Pool [Member] | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Common stock shares authorized | 726,041 | 726,041 | ||||||||||
Common stock shares reserved for future issuance | 726,041 | 726,041 | ||||||||||
2014 EIP [Member] | Maximum [Member] | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Common stock shares authorized | 22,052,130 | |||||||||||
2011 EIP [Member] | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Common stock shares authorized | 10,000,000 | |||||||||||
2014 Non-Employee Equity Plan [Member] | ||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||||
Reduction in number of shares authorized for issuance | 1,000,000 | 1,000,000 | ||||||||||
Common stock shares authorized | 499,913 | 499,913 | 2,500,000 | |||||||||
Common stock shares reserved for future issuance | 499,913 | 499,913 |
Share-Based Incentive Plans - S
Share-Based Incentive Plans - Summary of Stock Option Activity (Detail) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2017 | Dec. 31, 2016 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Options, Outstanding Beginning Balance | 13,627,519 | |
Options, Granted | 2,020,017 | |
Options, Exercised | (270,427) | |
Options, Forfeited | (550,871) | |
Options, Expired | (255,653) | |
Options, Outstanding Ending Balance | 14,570,585 | 13,627,519 |
Options, Exercisable as of September 30, 2017 | 8,885,001 | |
Weighted Average Exercise Price, Outstanding Beginning Balance | $ 18.17 | |
Weighted Average Exercise Price, Granted | 16.46 | |
Weighted Average Exercise Price, Exercised | 6.35 | |
Weighted Average Exercise Price, Forfeited | 18.54 | |
Weighted Average Exercise Price, Expired | 20.70 | |
Weighted Average Exercise Price, Outstanding Ending Balance | 18.10 | $ 18.17 |
Weighted Average Exercise Price, Exercisable as of September 30, 2017 | $ 16.84 | |
Weighted Average Contractual Term Remaining (in years) | 7 years 1 month 21 days | 7 years 7 months 6 days |
Weighted Average Contractual Term Remaining (in years) Exercisable as of September 30, 2017 | 6 years 4 months 21 days | |
Aggregate Intrinsic Value | $ 18,333 | $ 35,157 |
Aggregate Intrinsic Value, Exercisable as of September 30, 2017 | $ 17,699 |
Share-Based Incentive Plans - W
Share-Based Incentive Plans - Weighted Average Fair Value per Share of Stock Option Awards Granted and Assumptions Used to Value Stock Options (Detail) - $ / shares | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Risk-free interest rate, minimum | 1.80% | 1.30% |
Risk-free interest rate, maximum | 2.00% | 1.80% |
Weighted average expected volatility | 49.10% | 73.80% |
Expected life (in years) | 6 years | 6 years 1 month 6 days |
Weighted average grant-date fair value per share of options granted | $ 7.99 | $ 11.78 |
Share-Based Incentive Plans -82
Share-Based Incentive Plans - Summary of Restricted Stock Unit Activity (Detail) - Restricted Stock Units [Member] | 9 Months Ended |
Sep. 30, 2017$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Number of Units, Outstanding Beginning Balance | shares | 3,367,871 |
Number of Units, Granted | shares | 3,454,579 |
Number of Units, Vested | shares | (1,040,529) |
Number of Units, Forfeited | shares | (440,874) |
Number of Units, Outstanding Ending Balance | shares | 5,341,047 |
Weighted Average Grant-Date Fair Value Per Unit, Outstanding Beginning Balance | $ / shares | $ 18.45 |
Weighted Average Grant-Date Fair Value Per Unit, Granted | $ / shares | 12.34 |
Weighted Average Grant-Date Fair Value Per Unit, Vested | $ / shares | 16.86 |
Weighted Average Grant-Date Fair Value Per Unit, Forfeited | $ / shares | 17.46 |
Weighted Average Grant-Date Fair Value Per Unit, Outstanding Ending Balance | $ / shares | $ 14.89 |
Share-Based Incentive Plans -83
Share-Based Incentive Plans - Summary of Performance Stock Unit Awards Activity (Detail) - Performance Stock Units [Member] | 9 Months Ended |
Sep. 30, 2017$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Number of Units, Outstanding Beginning Balance | shares | 12,045,656 |
Number of Units, Vested | shares | (25,000) |
Number of Units, Forfeited | shares | (238,336) |
Number of Units, Outstanding Ending Balance | shares | 11,782,320 |
Weighted Average Grant-Date Fair Value Per Unit, Vested | $ / shares | $ 12.36 |
Weighted Average Grant-Date Fair Value Per Unit, Forfeited | $ / shares | $ 10.86 |
Average Illiquidity discount, Vested | 0.00% |
Average Illiquidity discount, Forfeited | 7.50% |
Recorded Weighted Average Fair Value Per Unit, Vested | $ / shares | $ 13.30 |
Recorded Weighted Average Fair Value Per Unit, Forfeited | $ / shares | $ 10.04 |
Share-Based Incentive Plans -84
Share-Based Incentive Plans - Summary of Vesting Tranches (Detail) | 9 Months Ended |
Sep. 30, 2017 | |
Performance Stock Units [Member] | Tranche One [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Percent of Total PSU Award | 33.30% |
Beginning of Performance Measurement Period | Mar. 23, 2015 |
End of Performance Measurement Period | Dec. 22, 2017 |
Performance Stock Units [Member] | Tranche Two [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Percent of Total PSU Award | 33.30% |
Beginning of Performance Measurement Period | Mar. 23, 2015 |
End of Performance Measurement Period | Mar. 22, 2018 |
Performance Stock Units [Member] | Tranche Three [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Percent of Total PSU Award | 33.30% |
Beginning of Performance Measurement Period | Mar. 23, 2015 |
End of Performance Measurement Period | Jun. 22, 2018 |
Performance Stock Units [Member] | Vesting Amount 25% [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Percent of Total PSU Award | 25.00% |
TSR Achieved Percentage | 15.00% |
Performance Stock Units [Member] | Vesting Amount 50% [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Percent of Total PSU Award | 50.00% |
TSR Achieved Percentage | 30.00% |
Performance Stock Units [Member] | Vesting Amount 75% [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Percent of Total PSU Award | 75.00% |
TSR Achieved Percentage | 45.00% |
Performance Stock Units [Member] | Vesting Amount 100% [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Percent of Total PSU Award | 100.00% |
TSR Achieved Percentage | 60.00% |
Initial Performance Stock Units [Member] | Tranche One [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Length of Performance Measurement Period (Years) | 2 years 9 months |
Initial Performance Stock Units [Member] | Tranche Two [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Length of Performance Measurement Period (Years) | 3 years |
Initial Performance Stock Units [Member] | Tranche Three [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Length of Performance Measurement Period (Years) | 3 years 2 months 30 days |
Share-Based Incentive Plans -85
Share-Based Incentive Plans - Summary of Significant Valuation Assumption (Detail) - $ / shares | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Risk free rate, minimum | 1.80% | 1.30% |
Risk free rate, maximum | 2.00% | 1.80% |
Performance Stock Units [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Expected volatility, minimum | 76.80% | |
Expected volatility, maximum | 77.60% | |
Risk free rate, minimum | 1.00% | |
Risk free rate, maximum | 1.20% | |
Performance Stock Units [Member] | Minimum [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Valuation date stock price | $ 17.72 | |
Performance Stock Units [Member] | Maximum [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Valuation date stock price | $ 21.07 |
Share-Based Incentive Plans -86
Share-Based Incentive Plans - Summary of Average Estimated Fair Value of PSU after Applicable Discount of Illiquidity (Detail) - Performance Stock Units [Member] | 9 Months Ended |
Sep. 30, 2017$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Number of Units | shares | 11,782,320 |
Weighted Average Fair Value Per Unit | $ 14.82 |
Average Illiquidity Discount | 16.30% |
Recorded Weighted Average Fair Value Per Unit | $ 12.41 |
Executive Committee Members [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Number of Units | shares | 8,889,656 |
Weighted Average Fair Value Per Unit | $ 15.15 |
Average Illiquidity Discount | 18.90% |
Recorded Weighted Average Fair Value Per Unit | $ 12.29 |
Non-Executive Committee Members [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Number of Units | shares | 2,892,664 |
Weighted Average Fair Value Per Unit | $ 13.78 |
Average Illiquidity Discount | 7.30% |
Recorded Weighted Average Fair Value Per Unit | $ 12.77 |
Share-Based Incentive Plans -87
Share-Based Incentive Plans - Summary of Stock-Based Compensation Expense (Detail) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Total share-based compensation expense | $ 87,935 | $ 84,921 |
Cost of Goods Sold [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Total share-based compensation expense | 1,696 | |
Research and Development [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Total share-based compensation expense | 6,613 | 6,845 |
Selling, General and Administrative [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Total share-based compensation expense | $ 79,626 | $ 78,076 |
Income Taxes - Expense (Benefit
Income Taxes - Expense (Benefit) for Income Taxes (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | ||||
Loss before expense (benefit) for income taxes | $ (56,790) | $ (33,617) | $ (406,216) | $ (68,238) |
Expense (benefit) for income taxes | 7,181 | (27,747) | (42,138) | (31,946) |
Net loss | $ (63,971) | $ (5,870) | $ (364,078) | $ (36,292) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | ||||
Expense (benefit) for income taxes | $ 7,181 | $ (27,747) | $ (42,138) | $ (31,946) |
Subsequent Events - Additional
Subsequent Events - Additional Information (Detail) - USD ($) $ in Millions | Oct. 23, 2017 | Mar. 29, 2017 | Sep. 30, 2017 |
2017 Term Loan Facility [Member] | |||
Subsequent Event [Line Items] | |||
LIBOR floor rate | 1.00% | ||
Interest rate description | The March 2017 Refinancing Loans bore interest, at the Borrowers’ option, at a rate equal to either the London Inter-Bank Offer Rate (“LIBOR”), plus an applicable margin of 3.75% per year (subject to a LIBOR floor of 1.00%), or the adjusted base rate plus 2.75%. The adjusted base rate was defined as the greater of (a) LIBOR (using one-month interest period) plus 1.00%, (b) prime rate, (c) fed funds plus 0.5%, and (d) 2.00%. | ||
Repayment of refinanced loans, amount | $ 769 | ||
Cut off percentage for defining limited liability subsidiaries, portion of capital stock held maximum | 65.00% | ||
Proceeds from debt issuances, percentage on excess cash flow | 50.00% | ||
Proceeds from debt issuances, reduction percentage on excess cash flow | 25.00% | ||
Proceeds from debt issuances, percentage on first lien leverage ratio | 0.00% | ||
Principal amount of loan, amortization percentage | 1.00% | ||
Credit agreement, description | The Borrowers were required to make mandatory prepayments of loans under the March 2017 Credit Agreement (without payment of a premium) with (a) net cash proceeds from certain non-ordinary course asset sales (subject to reinvestment rights and other exceptions), (b) casualty proceeds and condemnation awards (subject to reinvestment rights and other exceptions), (c) net cash proceeds from issuances of debt (other than certain permitted debt), and (d) 50% of the Company’s excess cash flow (subject to decrease to 25% or 0% if the Company’s first lien leverage ratio is less than 2.25:1 or 1.75:1, respectively). The March 2017 Refinancing Loans amortized in equal quarterly installments beginning on June 30, 2017 in an aggregate annual amount equal to 1.00% of the original principal amount thereof, with any remaining balance payable on March 29, 2024, the final maturity date of the March 2017 Refinancing Loans. | ||
2017 Term Loan Facility [Member] | Maximum [Member] | |||
Subsequent Event [Line Items] | |||
First lien leverage ratio | 225.00% | ||
2017 Term Loan Facility [Member] | Minimum [Member] | |||
Subsequent Event [Line Items] | |||
First lien leverage ratio | 175.00% | ||
2017 Term Loan Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||
Subsequent Event [Line Items] | |||
Debt instrument variable rate | 3.75% | ||
2017 Term Loan Facility [Member] | Adjusted Base Rate [Member] | |||
Subsequent Event [Line Items] | |||
Debt instrument variable rate | 2.75% | ||
Horizon Pharma USA Inc [Member] | Refinancing Loans | |||
Subsequent Event [Line Items] | |||
Line of credit facility borrowing capacity | $ 850 | ||
Subsequent Event [Member] | 2017 Term Loan Facility [Member] | |||
Subsequent Event [Line Items] | |||
LIBOR floor rate | 1.00% | ||
Interest rate description | The October 2017 Refinancing Loans bear interest, at the Borrowers’ option, at a rate equal to either LIBOR plus an applicable margin of 3.25% per year (subject to a LIBOR floor of 1.00%), or the adjusted base rate plus 2.25%. The adjusted base rate is defined as the greater of (a) LIBOR (using one-month interest period) plus 1.00%, (b) prime rate, (c) fed funds plus 0.5%, and (d) 2.00% | ||
Repayment of refinanced loans, amount | $ 845.8 | ||
Cut off percentage for defining limited liability subsidiaries, portion of capital stock held maximum | 65.00% | ||
Proceeds from debt issuances, percentage on excess cash flow | 50.00% | ||
Proceeds from debt issuances, reduction percentage on excess cash flow | 25.00% | ||
Proceeds from debt issuances, percentage on first lien leverage ratio | 0.00% | ||
Principal amount of loan, amortization percentage | 1.00% | ||
Credit agreement, description | The Borrowers are required to make mandatory prepayments of loans under the Credit Agreement (without payment of a premium) with (a) net cash proceeds from certain non-ordinary course asset sales (subject to reinvestment rights and other exceptions), (b) casualty proceeds and condemnation awards (subject to reinvestment rights and other exceptions), (c) net cash proceeds from issuances of debt (other than certain permitted debt), and (d) 50% of the Company’s excess cash flow (subject to decrease to 25% or 0% if the Company’s first lien leverage ratio is less than 2.25:1 or 1.75:1, respectively). The October 2017 Refinancing Loans will amortize in equal quarterly installments beginning on December 31, 2017 in an aggregate annual amount equal to 1.00% of the original principal amount of the March 2017 Refinancing Loans (i.e. $850.0 million), with any remaining balance payable on March 29, 2024, the final maturity date of the October 2017 Refinancing Loans. | ||
Subsequent Event [Member] | 2017 Term Loan Facility [Member] | Maximum [Member] | |||
Subsequent Event [Line Items] | |||
First lien leverage ratio | 225.00% | ||
Subsequent Event [Member] | 2017 Term Loan Facility [Member] | Minimum [Member] | |||
Subsequent Event [Line Items] | |||
First lien leverage ratio | 175.00% | ||
Subsequent Event [Member] | 2017 Term Loan Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||
Subsequent Event [Line Items] | |||
Debt instrument variable rate | 3.25% | ||
Subsequent Event [Member] | 2017 Term Loan Facility [Member] | Adjusted Base Rate [Member] | |||
Subsequent Event [Line Items] | |||
Debt instrument variable rate | 2.25% | ||
Subsequent Event [Member] | Horizon Pharma USA Inc [Member] | October 2017 Refinancing Loans [Member] | |||
Subsequent Event [Line Items] | |||
Line of credit facility borrowing capacity | $ 845.8 |