Ultragenyx Pharmaceutical (RARE) 10-Q 8 Nov 16 2016 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2016	Nov. 03, 2016
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2016
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q3
Trading Symbol	RARE
Entity Registrant Name	Ultragenyx Pharmaceutical Inc.
Entity Central Index Key	1,515,673
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		40,859,861

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Current assets:
Cash and cash equivalents	$ 142,280	$ 93,569
Short-term investments	254,150	343,428
Restricted cash	1,411	150
Prepaid expenses and other current assets	18,944	13,060
Total current assets	416,785	450,207
Property and equipment, net	18,226	7,373
Restricted cash	2,076	2,135
Long-term investments	76,211	99,259
Other assets	1,868	595
Total assets	515,166	559,569
Current liabilities:
Accounts payable	6,616	2,942
Accrued liabilities	43,487	24,784
Deferred rent—current portion	328	192
Total current liabilities	50,431	27,918
Other liabilities	8,845	561
Total liabilities	59,276	28,479
Stockholders’ equity:
Preferred stock — 25,000,000 shares authorized; nil outstanding as of September 30, 2016 and December 31, 2015
Common stock — 250,000,000 shares authorized; 40,052,032 and 38,882,394 shares issued and outstanding as of September 30, 2016 and December 31, 2015, respectively	40	39
Additional paid-in capital	915,084	816,578
Accumulated other comprehensive income (loss)	12	(868)
Accumulated deficit	(459,246)	(284,659)
Total stockholders’ equity	455,890	531,090
Total liabilities and stockholders’ equity	$ 515,166	$ 559,569

CONDENSED CONSOLIDATED BALANCE3

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - shares	Sep. 30, 2016	Dec. 31, 2015
Statement Of Financial Position [Abstract]
Preferred stock, shares authorized	25,000,000	25,000,000
Preferred stock, shares outstanding	0	0
Common stock, shares authorized	250,000,000	250,000,000
Common stock, shares issued	40,052,032	38,882,394
Common stock, shares outstanding	40,052,032	38,882,394

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Income Statement [Abstract]
Revenue	$ 111		$ 128
Operating expenses:
Research and development	48,711	$ 29,704	132,458	$ 70,172
General and administrative	17,183	10,232	45,128	21,408
Total operating expenses	65,894	39,936	177,586	91,580
Loss from operations	(65,783)	(39,936)	(177,458)	(91,580)
Other income (expense), net:
Interest income	922	673	2,877	1,402
Other income (expense), net	(46)	31	(6)	(220)
Total other income (expense), net	876	704	2,871	1,182
Net loss	$ (64,907)	$ (39,232)	$ (174,587)	$ (90,398)
Net loss per share, basic and diluted	$ (1.64)	$ (1.03)	$ (4.46)	$ (2.51)
Shares used in computing net loss per share, basic and diluted	39,551,923	38,268,632	39,184,994	36,086,598

CONDENSED CONSOLIDATED STATEME5

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Statement Of Income And Comprehensive Income [Abstract]
Net loss	$ (64,907)	$ (39,232)	$ (174,587)	$ (90,398)
Other comprehensive income:
Foreign currency translation adjustments	(28)		(17)
Unrealized gain (loss) on available-for-sale securities	(212)	170	897	135
Other comprehensive income (loss):	(240)	170	880	135
Total comprehensive loss	$ (65,147)	$ (39,062)	$ (173,707)	$ (90,263)

CONDENSED CONSOLIDATED STATEME6

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Operating activities:
Net loss	$ (174,587)	$ (90,398)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation	34,771	15,395
Amortization of premium (discount) on investment securities, net	4,230	3,700
Depreciation and amortization	2,267	904
Non-cash license fee from collaboration arrangement	700
Changes in operating assets and liabilities:
Prepaid expenses and other current assets	(5,833)	(6,395)
Other assets	(1,273)	40
Accounts payable	3,842	(544)
Accrued liabilities and other liabilities	22,588	11,765
Net cash used in operating activities	(113,295)	(65,533)
Investing activities:
Purchase of property and equipment	(9,522)	(3,032)
Purchase of investments	(311,523)	(477,321)
Proceeds from the sale of investments	94,289	63,310
Proceeds from maturities of investments	326,228	158,420
Increase in restricted cash	(1,202)	(168)
Net cash provided by (used in) investing activities	98,270	(258,791)
Financing activities:
Proceeds from issuance of common stock in connection with underwritten public offerings, net	33,700	461,158
Proceeds from issuance of common stock in connection with collaboration agreement, net	26,362
Proceeds from issuance of common stock from equity awards, net	3,674	5,528
Net cash provided by financing activities	63,736	466,686
Net increase in cash and cash equivalents	48,711	142,362
Cash and cash equivalents at beginning of period	93,569	24,324
Cash and cash equivalents at end of period	$ 142,280	$ 166,686

Organization

Organization	9 Months Ended
	Sep. 30, 2016
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Organization	1. Organization Ultragenyx Pharmaceutical Inc. (the Company) is a biopharmaceutical company and was incorporated in California on April 22, 2010. The Company subsequently reincorporated in the state of Delaware in June 2011. The Company is focused on the identification, acquisition, development, and commercialization of novel products for the treatment of rare and ultra-rare diseases, with a focus on serious, debilitating genetic diseases. The Company is currently conducting a Phase 3 study of aceneuramic acid extended-release (Ace-ER) in patients with GNE myopathy, which is also known as hereditary inclusion body myopathy, a progressive muscle-wasting disorder; a Phase 3 study of recombinant human beta-glucuronidase (rhGUS) in patients with mucopolysaccharidosis 7 (MPS 7), a rare lysosomal storage disease; a Phase 2 clinical study for UX007 in patients with glucose transporter type-1 deficiency syndrome (Glut1 DS), a brain energy deficiency; a Phase 2 clinical study of UX007 in patients severely affected by long-chain fatty acid oxidation disorders (LC-FAOD), a genetic disorder in which the body is unable to convert long chain fatty acids into energy; and Phase 2 and Phase 3 studies of KRN23, an antibody targeting fibroblast growth factor 23, or FGF23, in patients with X-linked hypophosphatemia (XLH) and tumor-induced osteomalacia (TIO), both rare diseases that impair bone mineralization. The Company operates as one reportable segment.

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2016
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	2. Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated financial statements include the amounts of the Company and our wholly-owned subsidiaries and have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information and in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The unaudited interim consolidated financial statements have been prepared on the same basis as the annual financial statements. In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation. These financial statements should be read in conjunction with the audited financial statements and notes thereto for the preceding fiscal year contained in the Company’s Annual Report on Form 10-K filed on February 26, 2016 with the United States Securities and Exchange Commission (SEC). The results of operations for the three and nine months ended September 30, 2016 are not necessarily indicative of the results to be expected for the year ending December 31, 2016. The condensed consolidated balance sheet as of December 31, 2015 has been derived from audited financial statements at that date, but does not include all of the information required by GAAP for complete financial statements. Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent liabilities, and the reported amounts of expenses in the condensed consolidated financial statements and the accompanying notes. Management bases its estimates on historical experience and on various other market-specific and relevant assumptions that management believes to be reasonable under the circumstances. Actual results could differ from those estimates. Revenue Recognition The Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred, the price is fixed or determinable, and collectability is reasonably assured. Revenue is recognized once all revenue recognition criteria are met. During the three and nine months ended September 30, 2016, the Company recognized revenue from sales of rhGUS (UX003) on a “named patient” basis which are allowed in certain European countries prior to the commercial approval of the product in the territory. Due to the Company’s limited sales and collection history to date, revenue has been recognized upon receipt of payment. Recently Issued Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842) In March 2016, the FASB issued Accounting Standards Update, or ASU, No. 2016-09, Compensation — Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting accounting for employee share-based payments, including income tax consequences, application of award forfeitures to expense, classification on the statement of cash flows, and classification of awards as either equity or liabilities. This guidance is effective for annual reporting periods beginning after December 15, 2016, and interim periods within those annual periods. In May 2014, the FASB, issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) Revenue from Contracts with Customers: Principal versus Agent Considerations Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients

Fair Value Measurements

Fair Value Measurements	9 Months Ended
	Sep. 30, 2016
Fair Value Disclosures [Abstract]
Fair Value Measurements	3. Financial assets and liabilities are recorded at fair value. The carrying amount of certain financial instruments, including cash and cash equivalents, accounts payable, and accrued liabilities approximate fair value due to their relatively short maturities. Assets and liabilities recorded at fair value on a recurring basis in the condensed consolidated balance sheets are categorized based upon the level of judgment associated with the inputs used to measure their fair values. Fair value is defined as the exchange price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The authoritative guidance on fair value measurements establishes a three-tier fair value hierarchy for disclosure of fair value measurements as follows: Level 1 —Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date; Level 2 —Inputs are observable, unadjusted quoted prices in active markets for similar assets or liabilities, unadjusted quoted prices for identical or similar assets or liabilities 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 related assets or liabilities; and Level 3 —Unobservable inputs that are significant to the measurement of the fair value of the assets or liabilities that are supported by little or no market data. The following tables set forth the fair value of the Company’s financial assets remeasured on a recurring basis based on the three-tier fair value hierarchy (in thousands): September 30, 2016 Level 1 Level 2 Level 3 Total Financial Assets: Money market funds $ 101,007 $ — $ — $ 101,007 Corporate bonds — 225,797 — 225,797 Commercial paper — 11,956 — 11,956 Asset-backed securities — 35,133 — 35,133 U.S. Government Treasury and agency securities — 77,137 — 77,137 Total financial assets $ 101,007 $ 350,023 $ — $ 451,030 December 31, 2015 Level 1 Level 2 Level 3 Total Financial Assets: Money market funds $ 53,254 $ — $ — $ 53,254 Corporate bonds — 370,445 — 370,445 Commercial paper — 13,887 — 13,887 Asset-backed securities — 29,302 — 29,302 U.S. Government Treasury and agency securities — 47,452 — 47,452 Total financial assets $ 53,254 $ 461,086 $ — $ 514,340

Balance Sheet Components

Balance Sheet Components	9 Months Ended
	Sep. 30, 2016
Investments Debt And Equity Securities [Abstract]
Balance Sheet Components	4. Balance Sheet Components Cash Equivalents and Investments The fair values of cash equivalents, short-term investments, and long-term investments classified as available-for-sale securities, consisted of the following (in thousands): September 30, 2016 Gross Unrealized Amortized Cost Gains Losses Estimated Fair Value Money market funds $ 101,007 $ — $ — $ 101,007 Corporate bonds 225,782 104 (89 ) 225,797 Commercial paper 11,956 — — 11,956 Asset-backed securities 35,106 27 — 35,133 U.S. Government Treasury and agency securities 77,150 12 (25 ) 77,137 Total $ 451,001 $ 143 $ (114 ) $ 451,030 December 31, 2015 Gross Unrealized Amortized Cost Gains Losses Estimated Fair Value Money market funds $ 53,254 $ — $ — $ 53,254 Corporate bonds 371,098 11 (664 ) 370,445 Commercial paper 13,887 — — 13,887 Asset-backed securities 29,356 — (54 ) 29,302 U.S. Government Treasury and agency securities 47,613 — (161 ) 47,452 Total $ 515,208 $ 11 $ (879 ) $ 514,340 At September 30, 2016, the remaining contractual maturities of available-for-sale securities were less than two years. There have been no significant realized gains or losses on available-for-sale securities for the periods presented. Accrued Liabilities Accrued liabilities consist of the following (in thousands): September 30, December 31, 2016 2015 Research and clinical study expenses $ 16,281 $ 9,764 Payroll and related expenses 11,818 9,423 Repayment liability under collaboration agreement 11,358 — Other 4,030 5,597 Total accrued liabilities $ 43,487 $ 24,784

License and Research Agreements

License and Research Agreements	9 Months Ended
	Sep. 30, 2016
Research Grant Agreement [Abstract]
License and Research Agreements	5. License and Research Agreements Kyowa Hakko Kirin Collaboration and License Agreement In August 2013, the Company entered into a collaboration and license agreement with Kyowa Hakko Kirin Co., Ltd. (KHK), which was amended in August 2015. Under the terms of this collaboration and license agreement, the Company and KHK will collaborate on the development and commercialization of certain products containing KRN23, an antibody directed towards FGF23, in the field of orphan diseases in the United States and Canada, or the profit share territory, and in the European Union, Switzerland, and Turkey, or the European territory, and the Company will have the right to develop and commercialize such products in the field of orphan diseases in Mexico and Central and South America, or Latin America. In the field of orphan diseases, and except for ongoing studies being conducted by KHK, the Company will be the lead party for development activities in the profit share territory and in the European territory until the applicable transition date; the Company will also be the lead party for core development activities conducted in Japan and Korea, provided that the core development plan related to Japan and Korea shall be limited to clinical trials mutually agreed to by the Company and KHK. The Company will share the costs for development activities in the profit share territory and the European territory conducted pursuant to the development plan before the applicable transition date equally with KHK, and KHK shall be responsible for 100% of the costs for development activities in Japan and Korea. On the applicable transition date in the profit share territory and the European territory, KHK will become the lead party and be responsible for the costs of the development activities. However, the Company will continue to share the costs of the studies commenced prior to the applicable transition date equally with KHK. The Company has the primary responsibility for conducting certain research and development services. The Company is obligated to provide assistance in accordance with the agreed upon development plan as well as participate on various committees. If KRN23 is approved, the Company and KHK will share commercial responsibilities and profits in the profit share territory until the applicable transition date, KHK will commercialize KRN23 in the European territory, and the Company will develop and commercialize KRN23 in Latin America. KHK will manufacture and supply KRN23 for clinical use globally and will manufacture and supply KRN23 for commercial use in the profit share territory and Latin America. The Company is accounting for the agreement as a collaboration arrangement as defined in ASC 808, Collaborative Agreements. As of September 30, 2016 and December 31, 2015, the Company had receivables in the amount of $7.2 million and $3.8 million, respectively, for this collaboration arrangement. Takeda License and Collaboration and Purchase Agreements In June 2016, the Company executed a collaboration and license agreement with Takeda Pharmaceutical Company Limited (Takeda). Pursuant to the agreement, which became effective in July 2016, the Company obtained an exclusive license for a pre-clinical compound from Takeda in a pre-determined field of use, which includes an option to an additional field of use for this product with the terms to be negotiated, and an option to a specified product candidate (identified option product). The Company is responsible for the development costs for the pre-clinical compound and the identified option product pursuant to an initial development plan. Because the license to the pre-clinical compound has no alternative future use, the estimated fair value of $0.7 million was recorded as a research and development expense upon acquisition. Under the license for the pre-clinical compound, the Company may be required to make future milestone payments to Takeda of up to $7.5 million if certain development milestones are met, $75.0 million if certain regulatory milestones are met, and $150.0 million if certain commercial milestones are met, as well as royalties with respect to net sales in the high-single digits to low-teens. Any products resulting from the pre-clinical compound or the identified option product is referred to in this report as the “licensed product.” As part of the agreement, the Company and Takeda established a five-year research collaboration whereby the parties may mutually agree to add additional option products candidates to the collaboration, in which case the Company will bear the cost of the development activities, with certain exceptions. In July 2016, the Company consummated a common stock purchase agreement, executed in conjunction with the collaboration and license agreement, whereby Takeda purchased 374,590 shares of the Company’s common stock for $40.0 million in cash. The fair market value of the common stock issued to Takeda was $27.3 million, based on the closing stock price of $72.95 on the date of issuance, resulting in a $12.7 million premium paid to the Company. The Company also received a put option to require Takeda to purchase an additional $25.0 million in shares of the Company’s common stock at the then-current 30-day volume-weighted average price (VWAP). The Company also received a second put option, which is contingent upon meeting certain development milestones on the identified option product, to require Takeda to purchase an additional $10.0 million in shares of the Company’s common stock at the then-current 30-day VWAP. Takeda is subject to a 180-day lock-up provision as a result of the initial purchase of common stock, is subject to a five-year standstill (subject to customary exceptions or release), and has registration rights for purchases of common stock. The Company estimated the fair value of the put options to be $0.9 million and recorded the put options in additional paid-in capital. The value of the put options was estimated as of the effective date of the agreement using Level 3 unobservable inputs. The valuation was performed using a Monte Carlo simulation approach using the term of the put options and an equity volatility of approximately 70%. The Company also granted Takeda an exclusive option for Asian rights, for a limited period, to any licensed products and any additional products resulting from the collaboration, as well as an option to exclusively license one of the Company’s products for development and commercialization in Japan. If Takeda exercises any of its option rights to license a product pursuant to the agreement, Takeda will pay for the development costs within the licensed territory, will share in a portion of the global development costs, and will make a milestone payment upon regulatory approval. Takeda will also owe royalties on net sales in the licensed territory for any licensed product, depending on the development stage when the product is licensed as well as sales levels. The royalties related to the option to license the Company’s product, as well as the additional product are subject to future good faith negotiations at the time that the option is exercised. The research and license agreement and the stock purchase agreement are being accounted for as one arrangement because they were entered into at the same time. The arrangements were evaluated pursuant to ASC 605-25, Multiple-Element Arrangements In October 2016, the Company exercised its first put option whereby Takeda received 352,530 shares of the Company’s common stock for $25.0 million in cash.

Stock-Based Awards

Stock-Based Awards	9 Months Ended
	Sep. 30, 2016
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Stock-Based Awards	6 . Stock-Based Awards 2014 Incentive Plan In 2014, the Company adopted the 2014 Incentive Plan (the 2014 Plan), which became effective upon the closing of the Company’s IPO in February 2014. The 2014 Plan provides for automatic annual increases in shares available for grant, beginning on January 1, 2015 through January 1, 2024. As of September 30, 2016, there were 1,047,754 shares reserved under the 2014 Plan for the future issuance of equity awards. The Company also had 1,380,922 shares reserved for the 2014 Employee Stock Purchase Plan, for which no shares had been issued. Stock-Based Compensation Expense The table below sets forth the functional classification of stock-based compensation expense, net of estimated forfeitures, for the periods presented (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Research and development $ 8,294 $ 5,555 $ 21,364 $ 10,528 General and administrative 5,400 2,341 13,407 4,867 Total stock-based compensation $ 13,694 $ 7,896 $ 34,771 $ 15,395

Net Loss Per Share

Net Loss Per Share	9 Months Ended
	Sep. 30, 2016
Earnings Per Share [Abstract]
Net Loss Per Share	7 . Net Loss Per Share Basic net loss per share has been computed by dividing the net loss by the weighted-average number of shares of common stock outstanding during the period. Diluted net loss per share is calculated by dividing net loss by the weighted-average number of shares of common stock and potential dilutive securities outstanding during the period. The following weighted-average outstanding common stock equivalents were excluded from the computation of diluted net loss per share for the periods presented because including them would have been antidilutive: Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Stock options to purchase common stock 4,667,509 3,525,167 4,215,487 3,066,088 Unvested restricted stock units 528,688 163,613 359,637 96,827 Common stock warrants 149,700 149,700 149,700 211,116 5,345,897 3,838,480 4,724,824 3,374,031

Equity Transactions

Equity Transactions	9 Months Ended
	Sep. 30, 2016
Equity [Abstract]
Equity Transactions	8 . Equity Transactions In July 2016, the Company entered into an At-The-Market, or ATM, sales agreement, with Cowen and Company, LLC (Cowen), whereby the Company may sell up to $150.0 million in aggregate proceeds of common stock from time to time, through Cowen as our sales agent. During the three and nine months ended September 30, 2016, the Company sold 497,815 shares of common stock, resulting in net proceeds of approximately $33.7 million, after commissions and other offering costs. During the period of October 1, 2016 through November 7, 2016, the Company sold an additional 398,385 shares of common stock, resulting in net proceeds of approximately $26.0 million, after commissions and other offering costs.

Summary of Significant Accoun15

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2016
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying unaudited condensed consolidated financial statements include the amounts of the Company and our wholly-owned subsidiaries and have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information and in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The unaudited interim consolidated financial statements have been prepared on the same basis as the annual financial statements. In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation. These financial statements should be read in conjunction with the audited financial statements and notes thereto for the preceding fiscal year contained in the Company’s Annual Report on Form 10-K filed on February 26, 2016 with the United States Securities and Exchange Commission (SEC). The results of operations for the three and nine months ended September 30, 2016 are not necessarily indicative of the results to be expected for the year ending December 31, 2016. The condensed consolidated balance sheet as of December 31, 2015 has been derived from audited financial statements at that date, but does not include all of the information required by GAAP for complete financial statements.
Use of Estimates	Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent liabilities, and the reported amounts of expenses in the condensed consolidated financial statements and the accompanying notes. Management bases its estimates on historical experience and on various other market-specific and relevant assumptions that management believes to be reasonable under the circumstances. Actual results could differ from those estimates.
Revenue Recognition	Revenue Recognition The Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred, the price is fixed or determinable, and collectability is reasonably assured. Revenue is recognized once all revenue recognition criteria are met. During the three and nine months ended September 30, 2016, the Company recognized revenue from sales of rhGUS (UX003) on a “named patient” basis which are allowed in certain European countries prior to the commercial approval of the product in the territory. Due to the Company’s limited sales and collection history to date, revenue has been recognized upon receipt of payment.
Recently Issued Accounting Pronouncements	Recently Issued Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842) In March 2016, the FASB issued Accounting Standards Update, or ASU, No. 2016-09, Compensation — Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting accounting for employee share-based payments, including income tax consequences, application of award forfeitures to expense, classification on the statement of cash flows, and classification of awards as either equity or liabilities. This guidance is effective for annual reporting periods beginning after December 15, 2016, and interim periods within those annual periods. In May 2014, the FASB, issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) Revenue from Contracts with Customers: Principal versus Agent Considerations Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	9 Months Ended
	Sep. 30, 2016
Fair Value Disclosures [Abstract]
Summary of Financial Assets Measured on Recurring Basis	The following tables set forth the fair value of the Company’s financial assets remeasured on a recurring basis based on the three-tier fair value hierarchy (in thousands): September 30, 2016 Level 1 Level 2 Level 3 Total Financial Assets: Money market funds $ 101,007 $ — $ — $ 101,007 Corporate bonds — 225,797 — 225,797 Commercial paper — 11,956 — 11,956 Asset-backed securities — 35,133 — 35,133 U.S. Government Treasury and agency securities — 77,137 — 77,137 Total financial assets $ 101,007 $ 350,023 $ — $ 451,030 December 31, 2015 Level 1 Level 2 Level 3 Total Financial Assets: Money market funds $ 53,254 $ — $ — $ 53,254 Corporate bonds — 370,445 — 370,445 Commercial paper — 13,887 — 13,887 Asset-backed securities — 29,302 — 29,302 U.S. Government Treasury and agency securities — 47,452 — 47,452 Total financial assets $ 53,254 $ 461,086 $ — $ 514,340

Balance Sheet Components (Table

Balance Sheet Components (Tables)	9 Months Ended
	Sep. 30, 2016
Investments Debt And Equity Securities [Abstract]
Summary of Fair Values of Cash Equivalents, Short-Term Investments and Long-Term Investments Classified as Available-for-Sale Securities	The fair values of cash equivalents, short-term investments, and long-term investments classified as available-for-sale securities, consisted of the following (in thousands): September 30, 2016 Gross Unrealized Amortized Cost Gains Losses Estimated Fair Value Money market funds $ 101,007 $ — $ — $ 101,007 Corporate bonds 225,782 104 (89 ) 225,797 Commercial paper 11,956 — — 11,956 Asset-backed securities 35,106 27 — 35,133 U.S. Government Treasury and agency securities 77,150 12 (25 ) 77,137 Total $ 451,001 $ 143 $ (114 ) $ 451,030 December 31, 2015 Gross Unrealized Amortized Cost Gains Losses Estimated Fair Value Money market funds $ 53,254 $ — $ — $ 53,254 Corporate bonds 371,098 11 (664 ) 370,445 Commercial paper 13,887 — — 13,887 Asset-backed securities 29,356 — (54 ) 29,302 U.S. Government Treasury and agency securities 47,613 — (161 ) 47,452 Total $ 515,208 $ 11 $ (879 ) $ 514,340
Accrued Liabilities	Accrued liabilities consist of the following (in thousands): September 30, December 31, 2016 2015 Research and clinical study expenses $ 16,281 $ 9,764 Payroll and related expenses 11,818 9,423 Repayment liability under collaboration agreement 11,358 — Other 4,030 5,597 Total accrued liabilities $ 43,487 $ 24,784

Stock-Based Awards (Tables)

Stock-Based Awards (Tables)	9 Months Ended
	Sep. 30, 2016
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Functional Classification of Stock-Based Compensation Expense, Net of Estimated Forfeitures	The table below sets forth the functional classification of stock-based compensation expense, net of estimated forfeitures, for the periods presented (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Research and development $ 8,294 $ 5,555 $ 21,364 $ 10,528 General and administrative 5,400 2,341 13,407 4,867 Total stock-based compensation $ 13,694 $ 7,896 $ 34,771 $ 15,395

Net Loss Per Share (Tables)

Net Loss Per Share (Tables)	9 Months Ended
	Sep. 30, 2016
Earnings Per Share [Abstract]
Outstanding Shares of Common Stock Equivalents Excluded from Computation of Diluted Net Loss per Share	The following weighted-average outstanding common stock equivalents were excluded from the computation of diluted net loss per share for the periods presented because including them would have been antidilutive: Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Stock options to purchase common stock 4,667,509 3,525,167 4,215,487 3,066,088 Unvested restricted stock units 528,688 163,613 359,637 96,827 Common stock warrants 149,700 149,700 149,700 211,116 5,345,897 3,838,480 4,724,824 3,374,031

Organization - Additional Infor

Organization - Additional Information (Details)	9 Months Ended
	Sep. 30, 2016Segment
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Number of reportable segments	1

Fair Value Measurements - Summa

Fair Value Measurements - Summary of Financial Assets Measured on Recurring Basis (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Financial Assets:
Fair value	$ 451,030	$ 514,340
Money Market Funds
Financial Assets:
Fair value	101,007	53,254
Asset Backed Securities
Financial Assets:
Fair value	35,133	29,302
Level 1
Financial Assets:
Fair value	101,007	53,254
Level 1 | Money Market Funds
Financial Assets:
Fair value	101,007	53,254
Level 2
Financial Assets:
Fair value	350,023	461,086
Level 2 | Asset Backed Securities
Financial Assets:
Fair value	35,133	29,302
Corporate Bonds
Financial Assets:
Fair value	225,797	370,445
Corporate Bonds | Level 2
Financial Assets:
Fair value	225,797	370,445
US Government Treasury and Agencies Securities
Financial Assets:
Fair value	77,137	47,452
US Government Treasury and Agencies Securities | Level 2
Financial Assets:
Fair value	77,137	47,452
Commercial Paper
Financial Assets:
Fair value	11,956	13,887
Commercial Paper | Level 2
Financial Assets:
Fair value	$ 11,956	$ 13,887

Balance Sheet Components - Summ

Balance Sheet Components - Summary of Fair Values of Cash Equivalents, Short-Term Investments and Long-Term Investments Classified as Available-for-Sale Securities (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	$ 451,001	$ 515,208
Gross Unrealized Gains	143	11
Gross Unrealized Losses	(114)	(879)
Estimated Fair Value	451,030	514,340
Money Market Funds
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	101,007	53,254
Estimated Fair Value	101,007	53,254
Commercial Paper
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	11,956	13,887
Estimated Fair Value	11,956	13,887
Corporate Bonds
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	225,782	371,098
Gross Unrealized Gains	104	11
Gross Unrealized Losses	(89)	(664)
Estimated Fair Value	225,797	370,445
Asset Backed Securities
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	35,106	29,356
Gross Unrealized Gains	27
Gross Unrealized Losses		(54)
Estimated Fair Value	35,133	29,302
U.S. Government Treasury and Agency Securities
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	77,150	47,613
Gross Unrealized Gains	12
Gross Unrealized Losses	(25)	(161)
Estimated Fair Value	$ 77,137	$ 47,452

Balance Sheet Components - Addi

Balance Sheet Components - Additional Information (Details)	9 Months Ended
	Sep. 30, 2016USD ($)
Schedule Of Available For Sale Securities [Line Items]
Significant realized gains or losses on available-for-sale securities	$ 0
Maximum
Schedule Of Available For Sale Securities [Line Items]
Available-for-sale securities remaining contractual maturities	2 years

Balance Sheet Components - Accr

Balance Sheet Components - Accrued Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Payables And Accruals [Abstract]
Research and clinical study expenses	$ 16,281	$ 9,764
Payroll and related expenses	11,818	9,423
Repayment liability under collaboration agreement	11,358
Other	4,030	5,597
Total accrued liabilities	$ 43,487	$ 24,784

License and Research Agreemen25

License and Research Agreements - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended			3 Months Ended		9 Months Ended
	Oct. 31, 2016	Jul. 31, 2016	Jun. 30, 2016	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Common stock purchased				40,052,032		40,052,032		38,882,394
Liability under collaboration arrangement				$ 11,358		$ 11,358
Research and development				48,711	$ 29,704	132,458	$ 70,172
Kyowa Hakko Kirin Collaboration | License Agreement
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Reduction in research and development cost				7,200	$ 3,400	18,200	$ 7,100
License agreement receivable				7,200		$ 7,200		$ 3,800
Takeda License and Collaboration and Purchase Agreements
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Estimated fair value of license recorded as research and development expense			$ 700
Research collaboration agreement, period			5 years
Common stock purchased		374,590
Common stock value		$ 40,000
Common closing stock price per share		$ 72.95
Common stock shares issued premium amount		$ 12,700
Option to purchase additional common stock, value		$ 25,000
Volume weighted average price, period		30 days
Second option to purchase additional common stock, value		$ 10,000
Common stock purchase agreement, terms						Takeda is subject to a 180-day lock-up provision as a result of the initial purchase of common stock, is subject to a five-year standstill (subject to customary exceptions or release), and has registration rights for purchases of common stock.
Total arrangement consideration received		14,300
Initial development plan period						Approximately one and a half years
Liability under collaboration arrangement				14,300		$ 14,300
Research and development				$ 300
Takeda License and Collaboration and Purchase Agreements | Put Option
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Estimated fair value of future options		$ 900
Takeda License and Collaboration and Purchase Agreements | Put Option | Subsequent Event
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Common stock issued upon option exercised in period, shares	352,530
Common stock issued upon option exercised in period, value	$ 25,000
Takeda License and Collaboration and Purchase Agreements | Put Option | Monte Carlo Simulation
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Equity volatility percentage		70.00%
Takeda License and Collaboration and Purchase Agreements | Common Stock
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Fair market value of shares issued		$ 27,300
Takeda License and Collaboration and Purchase Agreements | Maximum
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Estimated approximate cost for expected work performed		13,000
Takeda License and Collaboration and Purchase Agreements | Minimum
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Estimated approximate cost for expected work performed		$ 10,000
Takeda License and Collaboration and Purchase Agreements | Development Milestones | Maximum
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Future contingent milestone payments			$ 7,500
Takeda License and Collaboration and Purchase Agreements | Regulatory Milestones | Maximum
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Future contingent milestone payments			75,000
Takeda License and Collaboration and Purchase Agreements | Commercial Milestones | Maximum
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Future contingent milestone payments			$ 150,000

Stock-Based Awards - Additional

Stock-Based Awards - Additional Information (Details)	9 Months Ended
	Sep. 30, 2016shares
2014 Incentive Plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Share reserved for future issuance	1,047,754
Automatic increases in shares available for grant effective date	Jan. 1, 2015
Shares available for grant, ending date	Jan. 1, 2024
2014 Employee Stock Purchase Plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Share reserved for future issuance	1,380,922
Shares issued	0

Stock-Based Awards - Functional

Stock-Based Awards - Functional Classification of Stock-Based Compensation Expense, Net of Estimated Forfeitures (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Stock-based compensation expense	$ 13,694	$ 7,896	$ 34,771	$ 15,395
Research and development
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Stock-based compensation expense	8,294	5,555	21,364	10,528
General and administrative
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Stock-based compensation expense	$ 5,400	$ 2,341	$ 13,407	$ 4,867

Net Loss Per Share - Outstandin

Net Loss Per Share - Outstanding Shares of Common Stock Equivalents Excluded from Computation of Diluted Net Loss per Share (Details) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Common stock equivalents excluded from computation of diluted net loss per share	5,345,897	3,838,480	4,724,824	3,374,031
Stock options to purchase common stock
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Common stock equivalents excluded from computation of diluted net loss per share	4,667,509	3,525,167	4,215,487	3,066,088
Unvested Restricted Stock Units
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Common stock equivalents excluded from computation of diluted net loss per share	528,688	163,613	359,637	96,827
Common Stock Warrants
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Common stock equivalents excluded from computation of diluted net loss per share	149,700	149,700	149,700	211,116

Equity Transactions - Additiona

Equity Transactions - Additional Information (Details) - USD ($)	1 Months Ended		3 Months Ended	9 Months Ended
	Nov. 07, 2016	Jul. 31, 2016	Sep. 30, 2016	Sep. 30, 2016	Sep. 30, 2015
Stockholders Equity [Line Items]
Net proceeds from sale of common stock				$ 33,700,000	$ 461,158,000
Subsequent Event
Stockholders Equity [Line Items]
Common stock shares sold	398,385
Net proceeds from sale of common stock	$ 26,000,000
ATM Sales Agreement
Stockholders Equity [Line Items]
Common stock shares sold			497,815	497,815
Net proceeds from sale of common stock			$ 33,700,000	$ 33,700,000
Maximum | ATM Sales Agreement
Stockholders Equity [Line Items]
Option to sell common stock for cash		$ 150,000,000