Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2016 | Nov. 08, 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 | |
Entity Registrant Name | Kadmon Holdings, Inc. | |
Entity Central Index Key | 1,557,142 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 45,078,666 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 55,001 | $ 21,498 |
Accounts receivable, net | 1,056 | 2,410 |
Accounts receivable from affiliates | 610 | 985 |
Inventories, net | 2,280 | 3,468 |
Deferred offering costs | 890 | |
Prepaid expenses and other current assets | 930 | 3,490 |
Total current assets | 59,877 | 32,741 |
Fixed assets, net | 5,972 | 6,938 |
Intangible assets, net | 2,753 | 15,223 |
Goodwill | 3,580 | 3,580 |
Restricted cash | 2,116 | 2,116 |
Investment, at cost | 3,542 | 2,300 |
Investment, equity method | 8,954 | 21,224 |
Other noncurrent assets | 7 | 15 |
Total assets | 86,801 | 84,137 |
Current liabilities: | ||
Accounts payable | 8,962 | 5,902 |
Related party loan | 3,000 | 3,000 |
Accrued expenses | 12,437 | 11,843 |
Other short term liabilities | 10,377 | |
Deferred revenue | 4,424 | 4,500 |
Other milestone payable | 3,875 | |
Fair market value of financial instruments | 8,289 | |
Secured term debt—current | 4,940 | 1,900 |
Total current liabilities | 33,763 | 49,686 |
Deferred revenue | 25,117 | 28,417 |
Deferred rent | 4,350 | 3,865 |
Deferred tax liability | 1,349 | 1,349 |
Fair market value of financial instruments - non current | 4,534 | |
Other long term liabilities | 1,511 | 3,152 |
Secured term debt—net of current portion and discount | 24,939 | 26,264 |
Convertible debt, net of discount | 183,457 | |
Total liabilities | 95,563 | 296,190 |
Commitments and contingencies (Note 12 and 13) | ||
Stockholders’ deficit: | ||
Common Stock, $0.001 par value; 200,000,000 and 0 shares authorized at September 30, 2016 and December 31, 2015, respectively; 45,078,666 and 0 shares issued and outstanding at September 30, 2016 and December 31, 2015, respectively. | 45 | |
Additional paid-in capital | 84,375 | 372,936 |
Accumulated deficit | (131,015) | (643,845) |
Total stockholders’ deficit | (8,762) | (270,909) |
Total liabilities, redeemable convertible units, and stockholders’ deficit | 86,801 | 84,137 |
Class E Redeemable Convertible Units [Member] | ||
Current liabilities: | ||
Class E redeemable convertible units: 0 and 4,969,252 units issued and outstanding at September 30, 2016 and December 31, 2015, respectively | 58,856 | |
Class A Units [Member] | ||
Current assets: | ||
Prepaid expenses and other current assets | 9,000 | |
Stockholders’ deficit: | ||
Common units | ||
Class B Units [Member] | ||
Stockholders’ deficit: | ||
Common units | ||
Class C Units[Member] | ||
Stockholders’ deficit: | ||
Common units | ||
Class D Units [Member] | ||
Stockholders’ deficit: | ||
Common units | ||
Convertible Preferred Stock [Member] | ||
Stockholders’ deficit: | ||
Preferred stock | $ 37,833 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2016 | Dec. 31, 2015 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 200,000,000 | 0 |
Common stock, shares issued | 45,078,666 | 0 |
Common stock, shares outstanding | 45,078,666 | 0 |
Class E Redeemable Convertible Units [Member] | ||
Class E redeemable convertible units issued | 0 | 4,969,252 |
Class E redeemable convertible units outstanding | 0 | 4,969,252 |
Common unit, units outstanding | 4,969,252 | |
Class A Units [Member] | ||
Common unit, no par value | $ 0 | $ 0 |
Common unit, units issued | 0 | 53,946,001 |
Common unit, units outstanding | 0 | 53,946,001 |
Class B Units [Member] | ||
Common unit, no par value | $ 0 | $ 0 |
Common unit, units issued | 0 | 1 |
Common unit, units outstanding | 0 | 1 |
Class C Units[Member] | ||
Common unit, no par value | $ 0 | $ 0 |
Common unit, units issued | 0 | 1 |
Common unit, units outstanding | 0 | 1 |
Class D Units [Member] | ||
Common unit, no par value | $ 0 | $ 0 |
Common unit, units issued | 0 | 4,373,674 |
Common unit, units outstanding | 0 | 4,373,674 |
Convertible Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 10,000,000 | 0 |
Preferred stock, shares issued | 30,000 | 0 |
Preferred stock, shares outstanding | 30,000 | 0 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Revenues | ||||
Net sales | $ 4,345 | $ 9,802 | $ 15,504 | $ 23,576 |
License and other revenue | 1,350 | 1,482 | 6,274 | 4,205 |
Total revenue | 5,695 | 11,284 | 21,778 | 27,781 |
Cost of sales | 880 | 1,304 | 2,845 | 3,142 |
Write-down of inventory | 129 | 1,143 | 266 | 2,069 |
Gross profit | 4,686 | 8,837 | 18,667 | 22,570 |
Operating expenses: | ||||
Research and development | 9,550 | 8,439 | 27,134 | 23,344 |
Selling, general and administrative | 48,311 | 39,408 | 90,580 | 82,419 |
Impairment of intangible asset | 31,269 | 31,269 | ||
Gain on settlement of payable | (256) | (4,131) | ||
Total operating expenses | 57,605 | 79,116 | 113,583 | 137,032 |
Loss from operations | (52,919) | (70,279) | (94,916) | (114,462) |
Other expense (income) : | ||||
Interest income | (14) | (1) | (21) | (4) |
Interest expense | 54,023 | 8,956 | 71,016 | 19,796 |
Loss on extingushment of debt | 11,176 | 2,934 | 11,176 | 2,934 |
Change in fair value of financial instruments | (2,878) | (659) | (3,151) | (1,568) |
Gain on deconsolidation of subsidiary | (24,000) | |||
Loss on equity method investment | 1,741 | 533 | 12,270 | 1,121 |
Other loss (income) | 1 | 37 | 3 | (129) |
Total other expense (income) | 64,049 | 11,800 | 91,293 | (1,850) |
Loss before income tax expense | (116,968) | (82,079) | (186,209) | (112,612) |
Income tax expense | 315 | |||
Net loss | (116,968) | (82,079) | (186,524) | (112,612) |
Deemed dividend on convertible preferred stock and Class E redeemable convertible units | 21,264 | 21,264 | ||
Net loss attributable to common stockholders | $ (138,232) | $ (82,079) | $ (207,788) | $ (112,612) |
Basic and diluted net loss per share of common stock | $ (4.23) | $ (9.94) | $ (12.60) | $ (13.95) |
Weighted average basic and diluted shares of common stock outstanding | 32,678,259 | 8,255,011 | 16,487,715 | 8,070,165 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Deficit - 9 months ended Sep. 30, 2016 - USD ($) $ in Thousands | Class E Redeemable Convertible Units [Member] | Class A Units [Member]Additional Paid-in Capital [Member] | Class A Units [Member] | Class B Units [Member] | Class C Units[Member] | Class D Units [Member] | Convertible Preferred Stock [Member]Preferred Stock [Member] | Convertible Preferred Stock [Member]Accumulated Deficit [Member] | Convertible Preferred Stock [Member] | Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Total |
Balance at Dec. 31, 2015 | $ 58,856 | $ 372,936 | $ (643,845) | $ (270,909) | ||||||||||
Balance, Shares at Dec. 31, 2015 | 4,969,252 | 53,946,001 | 1 | 1 | 4,373,674 | |||||||||
Issuance to settle obligation | $ 13,460 | $ 125 | $ 125 | $ 1 | 2,499 | 2,500 | ||||||||
Issuance to settle obligation, shares | 1,170,437 | 25,000 | 208,334 | |||||||||||
Equity raised through issuance of Class E units, net | $ 5,500 | |||||||||||||
Equity raised through issuance of Class E units, net, shares | 478,266 | |||||||||||||
Accretion of units fee discount and repayment premium | $ 5,812 | (5,812) | (5,812) | |||||||||||
Share-based compensation expense | 41,416 | $ 41,416 | ||||||||||||
Issuance of units related to option exercises | $ 41 | $ 41 | ||||||||||||
Issuance of units related to option exercises, shares | 7,200 | 1,109 | ||||||||||||
Common stock issued in initial public offering, net of commissions and underwriting discounts | $ 6 | 69,744 | $ 69,750 | |||||||||||
Common stock issued in initial public offering, net of commissions and underwriting discounts, shares | 478,266 | 6,250,000 | ||||||||||||
Initial public offering costs | (3,739) | (3,739) | ||||||||||||
Beneficial conversion feature on units | 13,431 | (13,431) | 13,431 | |||||||||||
Corporate conversion from Kadmon Holdings, LLC to Kadmon Holdings, Inc. | (720,618) | 720,618 | ||||||||||||
Corporate conversion to common stock | $ (83,628) | $ 19 | 83,607 | 83,626 | ||||||||||
Corporate conversion to common stock, shares | 30,000 | 19,585,865 | ||||||||||||
Conversion of convertible debt | $ 30,000 | $ 30,000 | $ 19 | 182,712 | 182,731 | |||||||||
Conversion of convertible debt, shares | (6,617,955) | (53,978,201) | (1) | (1) | (4,373,674) | 19,034,467 | ||||||||
Beneficial conversion feature on convertible debt | 45,683 | 45,683 | ||||||||||||
Beneficial conversion feature on convertible preferred stock | 7,567 | $ (7,567) | 7,567 | |||||||||||
Accretion of dividends on convertible preferred stock | $ 266 | $ (266) | 266 | |||||||||||
Reclassification of warrants to equity | 1,716 | 1,716 | ||||||||||||
Beneficial conversion feature on warrants | 634 | 634 | ||||||||||||
Net loss | (186,524) | (186,524) | ||||||||||||
Balance at Sep. 30, 2016 | $ 37,833 | $ 45 | $ 84,375 | $ (131,015) | $ (8,762) | |||||||||
Balance, Shares at Sep. 30, 2016 | 30,000 | 45,078,666 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Cash flows from operating activities: | ||
Net loss | $ (186,524) | $ (112,612) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization of fixed assets | 1,727 | 1,741 |
Amortization of intangible asset | 12,470 | 22,180 |
Impairment of intangible asset | 31,269 | |
Write-down of inventory | 266 | 2,069 |
Write-down of capitalized computer software development costs | 61 | |
Gain on purchase commitment | (225) | |
Loss on extinguishment of debt / conversion of debt | 11,176 | 2,934 |
Write-off of deferred financing costs and debt discount | 3,820 | 2,752 |
Amortization of deferred financing costs | 1,176 | 841 |
Amortization of debt discount | 2,548 | 2,911 |
Accretion of repayment premium on secured term debt | (345) | |
Share-based compensation | 41,416 | 4,749 |
Gain on settlement of payable | (4,131) | |
Bad debt expense | 7 | 5 |
Gain on deconsolidation of subsidiary | (24,000) | |
Changes in fair value of financial instruments | (3,151) | (1,568) |
Beneficial conversion feature expense on warrants | 1,745 | |
Beneficial conversion feature expense on convertible debt | 44,170 | |
Fair value of units issued to consultants | 3,000 | 3,750 |
Fair value of shares / units issued in settlement of obligation | 4,360 | 7,647 |
Accrued legal settlement | 10,350 | |
Paid in-kind interest | 14,695 | 6,202 |
Loss on equity method investment | 12,270 | 1,121 |
Changes in operating assets and liabilities: | ||
Restricted cash | (89) | |
Accounts receivable, net | 480 | (4,145) |
Inventories, net | 922 | 1,873 |
Prepaid expenses and other assets | (432) | (564) |
Accounts payable | 2,593 | (2,969) |
Accrued expenses, other liabilities and deferred rent | 981 | 3,589 |
Deferred revenue | (3,376) | (6,136) |
Net cash used in operating activities | (37,792) | (46,609) |
Cash flows from investing activities: | ||
Purchases of fixed assets | (531) | (89) |
Net cash used in investing activities | (531) | (89) |
Cash flows from financing activities: | ||
Proceeds from issuance of common stock in IPO, net | 69,750 | |
Payments of initial public offering costs | (2,551) | |
Payment of financing costs related to debt exchange agreements | (534) | |
Proceeds from issuance of secured term debt | 35,000 | |
Proceeds from issuance of convertible debt | 92,000 | |
Payment of financing costs | (1,945) | |
Principal payments on secured term debt | (380) | (107,204) |
Proceeds from related party loans | 2,000 | |
Repayment of related party loans | (2,000) | |
Proceeds from issuance of Class A units, net | 15,000 | |
Proceeds from issuance of Class E redeemable convertible units, net | 5,500 | 558 |
Proceeds from exercise of stock options | 41 | |
Net cash provided by financing activities | 71,826 | 33,409 |
Net increase (decrease) in cash and cash equivalents | 33,503 | (13,289) |
Cash and cash equivalents, beginning of period | 21,498 | 20,991 |
Cash and cash equivalents, end of period | 55,001 | 7,702 |
Supplemental cash flow disclosures: | ||
Cash paid for interest | 2,798 | 7,090 |
Cash paid for taxes | 327 | 135 |
Non-cash investing and financing activities: | ||
Settlement of related party loan | 500 | |
Units issued in settlement of obligation | 11,725 | 9,063 |
Capitalized lease obligations | 230 | 20 |
Unpaid financing/offering costs | 743 | 2,741 |
Equity method investment related to deconsolidation | 24,000 | |
Financing costs paid with convertible notes | 2,260 | |
Fair value of warrants issued to lenders | $ 6,300 | |
Cost Method Investment in affiliate | 1,242 | |
Beneficial conversion feature on convertible preferred stock | 7,567 | |
Accretion of dividends on convertible preferred stock | 266 | |
Beneficial conversion feature on units | 13,431 | |
Conversion of Class E units into common stock | (83,626) | |
Class E Redeemable Convertible Units [Member] | ||
Non-cash investing and financing activities: | ||
Conversion of Class E units into common stock | 83,628 | |
Common Stock [Member] | ||
Non-cash investing and financing activities: | ||
Conversion of convertible debt | 176,615 | |
Convertible Preferred Stock [Member] | ||
Non-cash investing and financing activities: | ||
Conversion of convertible debt | $ 30,000 |
Organization and Basis of Prese
Organization and Basis of Presentation | 9 Months Ended |
Sep. 30, 2016 | |
Organization and Basis of Presentation [Abstract] | |
Organization and Basis of Presentation | 1. Organization and Basis of Presentation Nature of Business Kadmon Holdings, Inc. (together with its subsidiaries, “Kadmon” or “Company”) is a fully integrated biopharmaceutical company engaged in the discovery, development and commercialization of small molecules and biologics to address disease areas of significant unmet medical needs. The Company is actively developing product candidates in a number of indications within autoimmune and fibrotic disease, oncology and genetic diseases. The Company leverages its multi ‑disciplinary research and clinical development team members to identify and pursue a diverse portfolio of novel product candidates, both through in-licensing products and employing its small molecule and biologics platforms . By retaining global commercial rights to its lead product candidates, the Company believes that it has the ability to progress these candidates while maintaining flexibility for commercial and licensing arrangements. The Company expects to continue to progress its clinical candidates and have further clinical trial events throughout 2016 and 2017. Corporate Conversion, Initial Public Offering and Debt Conversion On July 26, 2016, in connection with the pricing of the Company’s IPO, Kadmon Holdings, LLC filed a certificate of conversion, whereby Kadmon Holdings, LLC effected a corporate conversion from a Delaware limited liability company to a Delaware corporation and chang ed its name to Kadmon Holdings, Inc. As a result of the corporate conversion, accumulated deficit was reduced to zero on the date of the corporate conversion, and the corresponding amount was credited to additional paid-in capital . In connection with this corporate conversion , the Company filed a certificate of incorporation and adopted bylaws, all of which were previously approved by the Company’s board of managers and members. Pursuant to the Company’s certificate of incorporation, the Company is authorized to issue up to 200,000,000 shares of common stock $0.001 par value per share and 10,000,000 shares of preferred stock $0.001 par value per share. All references in the unaudited interim consolidated financial statements to the number of shares and per-share amounts of common stock have been retroactively restated to reflect this conversion. On August 1, 2016, the Company completed its IPO whereby it sold 6,250,000 shares of common stock at $12.00 per share. The aggregate net proceeds received by the Company from the offering were $66.0 million, net of underwriting discounts and commissions of $5.3 million and offering expenses of $3.7 million. Upon the closing of the IPO , 45,078,666 shares of common stock were outstanding, which includes 19,034,467 shares of common stock as a result of the conversion of the Company’s Senior Convertible Term Loan and Second Lien Convert (See Note 6) . The shares began trading on the New York Stock Exchange on July 27, 2016 under the symbol “KDMN.” Liquidity The Company had an accumulated deficit of $131.0 million and working capital of $26.1 million at September 30, 2016 . For the nine months ended September 30, 2016 , the Company earned a $2.0 million milestone payment pursuant to a license agreement entered into with Jinghua to develop products using human monoclonal antibodies and raised $5.5 million through the issuance of Class E redeemable convertible units in June 2016. Additional l y, the Compa n y raised $66. 0 million, net of underwriting discounts and commissions and offering expenses , in its IPO which is expected to enable the Company to advance its planned Phase 2 clinical studies for KD025 and tesevatinib , complete its planned clinical studies for KD034 , advance certain of its other pipeline product candidates and fund its operating expenses and capital expenditure requirements into the fourth quarter of 2017 . On November 4, 2016, the Company executed a second amendment to the 2015 Credit Agreement. Pursuant to this amendment, the Company deferred further principal payments owed under the 2015 Credit Agreement in the amount of $380,000 per month until August 31, 2017. Additionally, the parties amended various clinical development milestones and added a covenant pursuant to which the Company is required to raise $40.0 million of additional equity capital by the end of the second quarter of 2017. All other material terms of the 2015 Credit Agreement, including the maturity date, remain the same. The Company maintained cash and cash equivalents of $55.0 million at September 30, 2016 . Management’s plans include continuing to finance operations through the issuance of additional equity instruments and securities and increasing the commercial portfolio through the development of the current pipeline or through the acquisition of a third party or license agreement. Any transactions which occur may contain covenants that restrict the ability of management to operate the business or may have rights, preferences or privileges senior to the Company’s common stock and may dilute current s tock holders of the Company. Engaging in a transaction with a third party is contingent on negotiations among the parties; therefore, there is no certainty that the Company will enter into such an agreement should the Company so desire. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2016 | |
Summary of Significant Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2 . Summary of Significant Accounting Policies Basis of Presentation The Company operates in one segment considering the nature of the Company’s products and services, class of customers, methods used to distribute the products and the regulatory environment in which the Company operates. For the 2015 period presented , research and development expenses, and selling, general and administrative expenses were revised to conform to the current presentation with regard to the Company’s method of allocating a portion of facility-related expenses to research and development expense s to more accurately reflect the effort spent on research and development. For the three and nine months ended September 30, 2015 , the Company reclassified $1.0 million and $2.9 million, respectively , from selling, general and administrative expense s to research and development expense s . Principles of Consolidation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The consolidated financial statements include the accounts of Kadmon Holdings, Inc. and its domestic and international subsidiaries, all of which are wholly owned. Interim Financial Statements The accompanying financial statements have been prepared in accordance with GAAP for interim financial information and with the instructions to F orm 10 - Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In our opinion the financial statements include all adjustments (consisting of normal recurring accruals) necessary in order to make the financial statements not misleading. Operating results for the three and nine months ended September 30, 2016 are not necessarily indicative of the final results that may be expected for the year ended December 31, 2016. These unaudited financial statements should be read in conjunction with the audited financial statements for the year ended December 31, 2015 included in the Company’s final prospectus filed pursuant to Rule 424(b) under the Securities Act of 1933, as amended (the “Securities Act”) with the Securities and Exchange Commission (the “SEC”) on July 27, 2016 (the “Final Prospectus”) . Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements. Actual results could differ from those estimates. Critical accounting policies The Company’s significant accounting policies are disclosed in the audited financial statements as of and for the year ended December 31, 2015 included in the Final Prospectus . Since the date of such financial statements, there have been no changes to the Company’s significant accounting policies, other than those described below. Inventories Inventories are stated at the lower of cost or market (on a first ‑in, first ‑out basis) using standard costs. Standard costs include an allocation of overhead rates, which include those costs attributable to managing the supply chain and are evaluated regularly. Variances are expensed as incurred. Deferred Offering Costs Deferred offering costs, which consisted primarily of direct costs related to the IPO, were being capitalized in other current assets until the consummation of the IPO. These offering costs were reclassified to additional paid ‑in capital upon the closing of the IPO, which occurred on August 1, 2016. There were no deferred offering costs capitalized as of September 30, 2016 and $0.9 million of deferred offering costs capitalized as of December 31, 2015 . Recent Accounting Pronouncements In March 2016, the FASB issued Accounting Standards Update (“ASU”) No. 2016 ‑09, “ Compensation—Stock Compensation ”. This ASU simplifies several aspects of the accounting for share ‑based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. This guidance is effective for annual and interim reporting periods of public entities beginning after December 15, 2016, with early adoption permitted. The Company is currently evaluating the impact of adopting the standard on its consolidated financial statements. In March 2016, the FASB issued ASU No. 2016 ‑08, “ Revenue from Contracts with Customers ” (“ASU 2016 ‑08”). This ASU amends the existing accounting guidance for principal versus agent considerations when recognizing revenue from contracts with customers. This guidance is effective for annual and interim reporting periods of public entities beginning after December 15, 2017, with early adoption permitted. In May 2014, the FASB issued ASU No. 2014 ‑09, “Revenue from Contracts with Customers .” Under this guidance, an entity is required to recognize revenue upon transfer of promised goods or services to customers, in an amount that reflects the expected consideration received in exchange for those goods or services. As such, an entity will need to use more judgment and make more estimates than under the current guidance. The Company is currently evaluating the appropriate transition method and any impact of this guidance on its consolidated financial statements and related disclosures. In March 2016, the FASB issued ASU No. 2016 ‑06, “ Derivatives and Hedging ” (“ASU 2016 ‑06”). This ASU clarifies the requirements for assessing whether contingent call (put) options that can accelerate the payment of principal on debt instruments are clearly and closely related to their debt hosts. This guidance is effective for annual and interim reporting periods of public entities beginning after December 15, 2016, with early adoption permitted. An entity should apply the amendments in this ASU on a modified retrospective basis to existing debt instruments as of the beginning of the fiscal year for which the amendments are effective. The Company is currently evaluating the impact of adopting the standard on its consolidated financial statements. In February 2016, the FASB issued ASU No. 2016 ‑02, “ Leases ” (“ASU 2016 ‑02”). This ASU amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets. This guidance is effective for annual and interim reporting periods of public entities beginning after December 15, 2018, with early adoption permitted. The Company is currently evaluating the impact of adopting the standard on its consolidated financial statements. In November 2015, the FASB issued ASU No. 2015 ‑17, “ Income Taxes (Topic 740) ” (“ASU 2015-17”) which simplifies the presentation of deferred income taxes. It requires that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. This standard is effective for annual reporting periods beginning after December 15, 2016 with early adoption permitted as of the beginning of an interim or annual reporting period. The new guidance may be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. The Company adopted ASU 2015 ‑17 in fiscal year 2015 and applied the guidance retrospectively to all periods presented. The adoption of ASU 2015 ‑17 did not have a significant impact on the Company’s consolidated financial statements or related disclosures. In August 2015, the FASB issued ASU No. 2015 ‑15, “ Interest—imputation of interest (Subtopic 835 ‑30)” (“ASU 2015-15”) which updated the accounting guidance related to the balance sheet presentation of debt issuance costs specific to line of credit arrangements. The updated accounting guidance allows the option of presenting deferred debt issuance costs related to line ‑of ‑credit arrangements as an asset, and subsequently amortizing over the term of the line ‑of ‑credit arrangement, regardless of whether there are any outstanding borrowings. The Company adopted ASU No. 2015 ‑15 in fiscal year 2015, which had no impact on its consolidated financial statements or related disclosures. In July 2015, the FASB issued ASU No. 2015 ‑11, “ Inventory (Topic 330) ” which simplifies the subsequent measurement of inventory. It replaces the current lower of cost or market test with a lower of cost or net realizable value test. The standard is effective for public entities for annual reporting periods beginning after December 15, 2016, and interim periods therein. Early adoption is permitted. The new guidance must be applied prospectively. The Company does not expect the standard to impact its consolidated financial statements. In April 2015, the FASB issued ASU No. 2015 ‑03 , “Interest—Imputation of Interest (Subtopic 835 ‑30) . ” This standard amends existing guidance to require the presentation of debt issuance costs in the balance sheet as a deduction from the carrying amount of the related debt liability instead of a deferred charge. It is effective for annual reporting periods beginning after December 15, 2015, but early adoption is permitted. The Company adopted this standard on its consolidated financial statements during 2015 and retroactively adjusted the prior year’s presentations to conform to the current presentation. These reclassifications had no effect on previously reported net income. In August 2014, the FASB issued ASU No. 2014 ‑15, “Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” (“ASU 2014-15”) to provide guidance on management’s responsibility in evaluating whether there is substantial doubt about a company’s ability to continue as a going concern and to provide related footnote disclosures. The Company adopted ASU 2014 ‑15 in fiscal year 2016 which did not have a significant impact on its consolidated financial statements or related disclosures. |
Members' Capital
Members' Capital | 9 Months Ended |
Sep. 30, 2016 | |
Members' Capital [Abstract] | |
Members' Capital | 3 . Members’ Capital Conversion Event The Class B, C and D units were required to automatically convert into Class A units pursuant to the Company’s Second Amended and Restated Limited Liability Company Operating Agreement, as amended (the “Operating Agreement”) upon certain defined conversion events including, but not limited to, dissolution of the Company or an underwritten IPO of the Company’s equity (each, a “Conversion Event”). The Conversion Event occurred on August 1, 2016, upon consummation of the Company’s IPO. The valuation of the Company at the Conversion Event was greater than $45.8 million, which resulted in t he Class B and C units receiving $41.7 million of the proceeds of the Conversion Event in the form of equivalent Class A units . The Class D units convert ed into Class A units such that the holders thereof receive d $4.2 million of such proceeds. The proceeds in excess of $45.8 million were shared ratably by the other holders of Class A units. Class A Units Class A units represent the Company’s common stock equivalents. As of September 30, 2016 Kadmon I , LLC (“ Kadmon I ”) holds approximately 12.1% of the total outstanding common stock of the Company and as of December 31, 2015 Kadmon I held approximately 66% of the total outstanding Class A units . Kadmon I is a Delaware limited liability company that was formed in August 2009 and is an affiliate of the Company (Note 15 ). Kadmon I ’s funds were raised through a private offering of 80% of Kadmon I’s total membership interests, the other 20% being owned by certain other members, including members of the Company’s board of managers and an executive officer at the time of such offering . Once each Kadmon I investor has received aggregate distributions equal to four times the amount of their initial investment, their collective ownership percentage in additional distributions will decrease from 80% to 50% , and the collective ownership percentage for the members of the Company’s board of managers, an executive officer and members in Kadmon I, and certain other members who received units will increase from 20% to 50% . The change in ownership percentages will require the Company to evaluate whether such changes will result in additional compensation expense. As of September 30, 2016 and December 31, 2015 , the Kadmon I investors had not received any distributions. Accordingly, no additional compensation expense was recognized. During the year ended December 31, 2015, the Company raised $15.0 million in net proceeds through the issuance of 1,250,000 Class A units. The Company also issued 1,500,000 Class A units pursuant to an advisory agreement entered into in April 2015. The Company recorded a deferred charge of $9.0 million related to the issuance of these units which was classified as a prepaid expense on the Company’s balance sheet and was expensed over the one year term in the advisory agreement. The Company expensed $2.3 million and $3.8 million during the three and nine months ended September 30, 2015 , respectively, related to the advisory agreement. The Company issued 5,011 Class A units as the result of stock option exercises during 2015. The Company also issued 308,334 Class A u nits to settle third party obligations, for which the Company expensed $1.5 million related to these settlements during the year ended December 31, 2015. During the nine months ended September 30, 2016 , the Company issued 25,000 Class A units to settle third party obligations, for which the Company expensed $0.1 million related to these settlements during the nine months ended September 30, 2016 and issued 7,200 Class A units as the result of stock option exercises. The Company also recorded an expense of $3.0 million during the nine months ended September 30, 2016 related to the advisory agreement entered into in April 2015. No expense was recorded for this agreement during the three months ended September 30, 2016 . The Class A units converted into common stock at the Conversion Event resulting in no Class A units outstanding at September 30, 2016 . Class B Unit The Class B unit did not participate in distributions from the Company, did not have any preferences in relation to the Class A units, was non ‑voting, and was non ‑redeemable. The only right afforded to the Class B unit was the right to convert into Class A units pursuant to the Company’s Operating Agreement ( s ee “Conversion Event”). One Class B unit was issued and outstanding as of December 31, 2015 . The Class B unit converted into common stock at the Conversion Event resulting in no Class B units outstanding at September 30, 2016 . Class C Unit The Class C unit did not participate in distributions from the Company, does not have any preferences in relation to the Class A units, is non ‑voting, and is non ‑redeemable. The only right afforded to the Class C unit was the right to convert into Class A units pursuant to the Operating Agreement ( s ee “Conversion Event”). One Class C unit was issued and outstanding as of December 31, 2015 . The Class C unit converted into common stock at the Conversion Event resulting in no Class C units outstanding at September 30, 2016 . Class D Units The Class D units d id not participate in distributions from the Company, d id not have any preferences in relation to the Class A units, we re non ‑voting, and were non ‑redeemable. The only right afforded to the Class D unit wa s the right to convert into Class A units pursuant to the Company’s Operating Agreement ( s ee “Conversion Event”). There were 4,373,674 Class D units issued and outstanding as of December 31, 2015 . The Class D units converted into common stock at the Conversion Event resulting in no Class D units outstanding at September 30, 2016 . Class E Redeemable Convertible Units One series of Class E redeemable convertible units, the Class E Series E ‑1 units (the “Class E redeemable convertible units”), was authorized. The Company was able to issue Class E redeemable convertible units with an aggregate Class E original issue price of up to $85 million, calculated in accordance with the terms of the Operating Agreement, of any series without being subject to preemptive rights. The Class E redeemable convertible units ha d voting rights and powers equal to the Class A units on an as ‑if converted basis, ha d a liquidation preference for liquidating distributions and participate d in distributions from the Company on an as ‑converted basis on non ‑liquidating distributions. In the case of a qualified IPO , the Class E redeemable convertible units automatically convert ed into Class A units at a conversion price of the lower of 85% of the value of Class A units (or the price per share of common stock of the corporate successor to the Company) or $11.50 per unit. Prior to a qualified IPO , the Class E redeemable convertible units could be converted at $11.50 per unit. A qualified IPO wa s defined as an offering of the Company’s equity interests with gross proceeds to the Company of at least $75 million. At any time after December 31, 2017, Class E redeemable convertible units were redeemable for cash at the option of the holders of at least 80% of all Class E redeemable convertible u nits at a redemption price equal to 125% of the liquidation preference. After January 1, 2016 all Class E redeemable convertible units began to accrue a liquidation preference (payable in connection with such liquidating distribution from the Company) at a rate of 5% per annum, compounding annually, with such liquidation preference rate increasing by 100 basis points every six months to a maximum of 10% . Redemption was subject to the Company’s ability to make such payment under then ‑existing debt obligations. Based on the terms of the Class E redeemable convertible units, the fair value of the Class E redeemable convertible units issued was classified as mezzanine capital on the Company’s consolidated balance sheet. The Company accrete d changes in the redemption value of the Class E redeemable convertible units to paid ‑in capital using the interest method, as the Company did not have available retained earnings, from the date of issuance to the earliest redemption date. During the year ended December 31, 2015, the Company raised $10.9 million in gross proceeds, $10.8 million net of $40,000 in transaction costs, through the issuance of 945,441 Class E redeemable convertible units. The Company raised $10.0 million through the issuance of Class E redeemable convertible units in October 2015 pursuant to a license agreement entered into with Jinghua to develop products using human monoclonal antibodies (Note 10 ) and $0.9 million through the issuance of Class E redeemable convertible units to other third party investors. The Company also issued 574,392 Class E redeemable convertible units to settle certain obligations totaling $6.6 million, of which $6.1 million was expensed in the third quarter of 2015 and $500,000 relate d to the settlement of a related party loan entered into in 2014 (Note 1 5 ). During the nine months ended September 30, 2016 , the Company raised $5.5 million in gross proceeds, with no transaction costs, through the issuance of 478,266 Class E redeemable convertible units. Harlan W. Waksal, M.D., the Company’s President and Chief Executive Officer, certain entities affiliated with GoldenTree Asset Management LP, Bart M. Schwartz , Esq. , the Company’s then Chairman of the board of managers , and D. Dixon Boardman, a member of the Company’s then board of managers subscribed for 86,957 , 43,479 , 21,740 and 21,740 Class E redeemable convertible units, respectively. The Company calculated a deemed dividend on the Class E redeemable convertible units of $ 13.4 million in August 201 6 , which equals a 15% discount to the IPO price of the Company’s common stock of $12.00 per share upon conversion to common stock at the Conversion Event, a beneficial conversion feature . There were 4,969,252 Class E redeemable convertible units i ssued and outstanding as of December 31, 2015 . The Class E redeemable convertible units converted into common stock at the Conversion Event resulting in no Class E redeemable convertible units outstanding at September 30, 2016 . 5% Convertible Preferred Stock Our certificate of incorporation permitted the Company’s board of directors to issue up to 10,000,000 shares of preferred stock from time to time in one or more classes or series. Concurrently with the closing of the Company’s IPO and pursuant to the terms of the exchange agreement entered into with the holders of the Company’s Senior Convertible Term Loan, the Company issued to such holders 30,000 shares of 5% convertible preferred stock, designated as the convertible preferred stock. Each share of convertible preferred stock was issued for an amount equal to $1,000 per share, which is referred to as the original purchase price. Shares of convertible preferred stock with an aggregate original purchase price and initial liquidation preference of $30.0 million were issued to the holders of the Senior Convertible Term Loan in exchange for an equivalent principal amount of the Senior Convertible Term Loan pursuant to the terms of an exchange agreement dated as of June 8, 2016, between the Company and those holders, which is referred to as the exchange agreement. The shares of convertible preferred stock are entitled to receive dividends, when and as declared by the board of directors and to the extent of funds legally available for the payment of dividends, at an annual rate of 5% of the sum of the original purchase price per share of convertible preferred stock plus any dividend arrearages. Dividends on the convertible preferred stock shall, at the Company’s option, either be paid in cash or added to the stated liquidation preference amount for purposes of calculating dividends at the 5% annual rate (until such time as the Company declares and pays the missed dividend in full and in cash, at which time that dividend will no longer be part of the stated liquidation preference amount). Dividends shall be payable annually on June 30 of each year and shall be cumulative from the most recent dividend payment date on which the dividend has been paid or, if no dividend has ever been paid, from the original date of issuance of the convertible preferred stock and shall accumulate from day to day whether or not declared until paid. The convertible preferred stock converts into shares of the Company’s common stock at a 20% discount to the price per share of common stock in the IPO. T he Company calculated a deemed dividend on the convertible preferred stock of $ 7.5 million in August 201 6 , which equals the 20% discount to the IPO price of the Company’s common stock of $12.00 per share, a beneficial conversion feature . T he Company accrued dividends on the convertible preferred stock of $ 0.3 million for the three and nine months ended September 30, 2016 . Common Stock Prior to the IPO, there were no shares outstanding of the Company’s common stock, par value $0.001 per share, and no stockholders of record. The Company’s certificate of incorporation authorizes the issuance of up to 200,000,000 shares of the Company’s common stock. On August 1, 2016, the Company completed its IPO whereby it sold 6,250,000 shares of common stock at $12.00 per share. The aggregate net proceeds received by the Company from the offering were $66.0 million, net of underwriting discounts and commissions of $5.3 million and offering expenses of $3.7 million. Upon the closing of the IPO , 45,078,666 shares of common stock were outstanding, which includes 19,034,467 shares of common stock issued upon the conversion of the Company’s Senior Convertible Term Loan and Second Lien Convert (See Note 6) . Valuation Prior to the IPO, t o estimate certain expenses and record certain transactions, it was necessary for the Company to estimate the fair value of its membership units. Given the absence of a public trading market, and in accordance with the American Institute of Certified Public Accountants’ Practice Guide, “Valuation of Privately ‑Held ‑Company Equity Securities Issued as Compensation , ” the Company exercised reasonable judgment and considered numerous objective and subjective factors to determine its best estimate of the fair value of its membership units. Factors considered included: · recent equity financings and the related valuations; · the estimated present value of the Company’s future cash flows; · industry information such as market size and growth; · market capitalization of comparable companies and the estimated value of transactions such companies have engaged in; and · macroeconomic conditions. The Company updated the valuation of Class A units as of September 30, 2015 using a methodology consistent with prior valuations. At the time of the valuation, the Company had issued $92.0 million in second ‑lien convertible debt, and it was deemed appropriate to place additional weighting on this consideration, as compared to prior valuations. The Company also considered equity raised through the issuance of $15.0 million in Class A units during 2015. The Company assigned no value to the Ribasphere products to reflect changes in market conditions that have resulted in lower sales of the Ribasphere products. As a result of the revised inputs to the analysis, the estimated fair value of each Class A unit was decreased from $39.00 to $32.50 as of September 30, 2015. |
Net Loss per Share Attributable
Net Loss per Share Attributable to Common Stockholders | 9 Months Ended |
Sep. 30, 2016 | |
Net Loss per Share Attributable to Common Stockholders [Abstract] | |
Net Loss per Share Attributable to Common Stockholders | 4 . Net Loss per Share Attributable to Common Stockholders Basic net loss per share attributable to common stockholders is computed by dividing the net loss attributable to common stockholders by the weighted-average number of common stock outstanding for the period. Because the Company has reported a net loss for all periods presented, diluted net loss per common share is the same as basic net loss per common share for those periods. The following table summarizes the computation of basic and diluted net loss per share attributable to common stockholders of the Company: Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Numerator – basic and diluted: Net loss attributable to common stockholders $ (138,232) $ (82,079) $ (207,788) $ (112,612) Denominator – basic and diluted: Weighted average common stock outstanding used to compute basic and diluted net loss per share 32,678,259 8,255,011 16,487,715 8,070,165 Net loss per share, basic and diluted $ (4.23) $ (9.94) $ (12.60) $ (13.95) The amounts in the table below were excluded from the calculation of diluted net loss per share, due to their anti-dilutive effect: Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Convertible preferred stock $ 3,159,688 $ 3,159,688 $ 3,159,688 $ 3,159,688 Options to purchase common stock 3,245,743 579,304 3,245,743 579,304 Warrants to purchase common stock 1,328,452 1,328,452 1,328,452 1,328,452 Total shares of common stock equivalents $ 7,733,883 $ 5,067,444 $ 7,733,883 $ 5,067,444 |
Commercial Partnership
Commercial Partnership | 9 Months Ended |
Sep. 30, 2016 | |
Commercial Partnership [Abstract] | |
Commercial Partnership | 5 . Commercial Partnership On June 17, 2013 , the Company entered into a series of agreements with a commercial partner, AbbVie, Inc. (“ AbbVie ”) , whereby the Company issued a non ‑exclusive license for the domestic sale of Ribasphere and also sold certain intellectual property and marketing rights related to the international sale of Ribasphere. The Company received upfront payments totaling $64.0 million, and could receive additional contingent payments totaling $51.0 million based on the achievement of certain milestones. The Company did not earn any such milestones during the nine months ended September 30, 2016 . Of the $64.0 million upfront payment, $44.0 million was considered allocable to the non ‑exclusive domestic licensing arrangement and was recorded as deferred revenue to be recognized over the 10 year term of the agreement. The Company will recognize the upfront payment to revenue on a straight ‑line basis over the life of the agreement. The Company recognized $3.3 million of the upfront consideration to license revenue during each of the nine months ended September 30, 2016 and 2015 and $1.1 million during each of the three months ended September 30, 2016 and 2015 . As of September 30, 2016 and December 31, 2015 , $29.5 million and $32.8 million is recorded as deferred revenue, respectively, of which $4.4 million is short ‑term. In October 2014, the Company entered into a series of amendments with AbbVie whereby the Company agreed to eliminate all potential future unearned and unpaid milestones and also agreed to a revised royalty structure for the sale of Ribasphere under the domestic license agreement. The Company received upfront payments of $6.0 million in consideration of future royalties payable resulting from the resale of Ribasphere by AbbVie during 2015 and 2016. At the time of receipt the balance was recorded to deferred revenue, $3.0 million of which was recorded as short ‑term as it related to prepaid royalties for 2015 and $3.0 million of which was recorded as long ‑term as it related to prepaid royalties for 2016. The Company will recognize portions of the deferred revenue to income as Ribasphere is sold by AbbVie. The Company is entitled to receive additional compensation from AbbVie for any royalties earned in excess of the annual prepayment. If royalties earned do not exceed the annual prepayment the Company is required to refund the excess to AbbVie. Since the royalties earned from the resale of Ribasphere by AbbVie under the domestic license agreement did not exceed the $3.0 million annual prepayment in 2015, the Company refunded approximately $2.1 million of the prepaid royalty to AbbVie as a credit against future purchases during the nine months ended September 30, 2016 . The Company had recorded this amount as an accrued expense at December 31, 2015. Furthermore, the Company expects to refund approximately $2.9 million of the prepaid royalty to AbbVie resulting from the resale of Ribasphere by AbbVie during 2016. Therefore, the Company has recorded this amount as an accrued expense at September 30, 2016 and other long term liability at December 31, 2015 , as the refund is payable in March 2017. The Company has a continuing obligation to supply Ribasphere , maintain the marketing authorization for Ribasphere and maintain the intellectual property for Ribasphere through the term of the agreements ending December 31, 2020 . |
Debt
Debt | 9 Months Ended |
Sep. 30, 2016 | |
Debt [Abstract] | |
Debt | 6 . Debt Concurrent with the closing of the IPO on August 1, 2016, the Company’s Senior Convertible Term Loan and Second Lien Convert converted into 19,034,467 shares of common stock. The Company is a party to three credit agreements in the following amounts (in thousands): September 30, December 31, 2016 2015 Senior convertible term loan due June 17, 2018 (A) $ — $ 58,500 Secured term debt due June 17, 2018 (B) 34,620 35,000 Second-lien convertible debt due August 28, 2019 (C) — 114,760 Total debt before fees, interest and debt discount 34,620 208,260 Paid-in-kind interest — 18,726 Less: Deferred financing costs (865) (5,861) Debt discount (3,876) (9,504) Total debt payable $ 29,879 $ 211,621 Debt payable, current portion $ 4,940 $ 1,900 Debt payable, long-term $ 24,939 $ 209,721 A. Senior Convertible Term Loan In August 2015, the Company entered into the Third Amended and Restated Convertible Credit Agreement (“ Senior Convertible Term Loan”), pursuant to which the Company was permitted to enter into the 2015 Credit Agreement (defined below) and a Second ‑Lien Convert (defined below) . Most of the reporting and financial covenants pertaining to the Company that were previously required were removed so that the Company only need ed to maintain a minimum liquidity amount. Beginning after June 30, 2016, the Company also had to meet a minimum revenue requirement. In August 2015, the Company further amended the terms of the Third Amended and Restated Convertible Credit Agreement to provide for, among other things, a $69.1 million term loan which was scheduled to mature on June 17, 2018 . As consideration for the amendment, if a qualified IPO, defined as a public offering of the Company’s equity interests with gross proceeds to the Company of at least $75.0 million, ha d not been completed on or prior to March 31, 2016, the Company agreed to pay an amendment fee equal to $1.3 million to be allocated among the lenders. This fee was paid in April 2016, as the Company did not complete a qualified IPO by this date. As a result of this amendment, $1.3 million was recorded as a debt discount at September 30, 2015 and wa s amortized to interest expense over the remaining term of the agreement as the amendment was deemed a modification in accordance with ASC 470. June 2016 Exchange Agreements In June 2016, the Company entered into an exchange agreement with all holders of the approximately $75.0 million in aggregate principal amount of the Senior Convertible Term Loan. Under the exchange agreement , (i) $30.0 million in aggregate principal amount of the Senior Convertible Term Loan was exchanged for 30,000 shares of a newly created class of capital stock that is designated as c onvertible p referred s tock and subject to a lock ‑up agreement; (ii) as to $25.0 million in aggregate principal amount of the Senior Convertible Term Loan, the Company convert ed 100% of that principal amount into shares of the Company’s common stock at a conversion price equal to 80% of the price per share of common stock in the IPO ; and (iii) as to $20.0 million in aggregate principal amount of the Senior Convertible Term Loan, the Company convert ed 125% of that principal amount into shares of the Company’s common stock at a conversion price equal to the price per share of common stock in the IPO . In addition, the Company paid a make ‑whole fee amounting to $8.0 million . The make ‑whole fee was paid through the issuance of shares of the Company’s common stock at an issue price equal to 80% of the price per share of common stock in the IPO. During the third quarter of 2016, t he Company incur red a $20.7 million charge as a result of a beneficial conversion feature included in the exchange agreement , since the conversion price was equal to a 20% discount to the price per share of common stock in the IPO . B. Secured Term Debt August 2015 Secured Term Debt In August 2015, the Company entered into a secured term loan in the amount of $35.0 million with two lenders (“2015 Credit Agreement”). The interest rate on the loan is LIBOR plus 9.375% with a 1% floor. The Company incurred and paid a $788,000 commitment fee in connection with the loan that will be amortized to interest expense over the term of the agreement. The basic terms of the loan require d monthly payments of interest only through the first anniversary date of the loan and require the Company to maintain certain financial covenants requiring the Company to maintain a minimum liquidity amount and minimum revenue levels beginning after June 30, 2016 through August 1, 2016, the date the Company consummated its IPO . Beginning on the first anniversary date of the loan, the Company is required to make monthly principal payments in the amount of $380,000 . Any outstanding balance of the loan and accrued interest is to be repaid on June 17, 2018 . The secured term loan is secured by the tangible and intangible property of the Company. In conjunction with the 2015 Credit Agreement, warrants to purchase $6.3 million of Class A units were issued to two lenders, of which $5.4 million was recorded as a debt discount and $900,000 was recorded as loss on extinguishment of debt (Note 7 ). The debt discount is being amortized over the life of the outstanding term loan using the effective interest method. Deferred financing costs of $1.3 million were recognized in recording the 2015 Credit Agreement and will be amortized to interest expense over the three year term of the agreement. Additionally, a fee paid to one existing lender of $113,000 was charged to loss on exting uishment of debt in accordance with ASC 470. There was also $1.5 million of debt discount and $390,000 of deferred financing cost write ‑offs charged to loss on extinguishment of debt in accordance with ASC 470 in connection with this transaction. Unamortized deferred financing costs were $0.9 million and $1.1 million at September 30, 2016 and December 31, 2015 , respectively. Approximately $0.1 million and $0.4 million was charged to interest expense during the three and nine months ended September 30, 2016 , respectively. I nterest expense was $0.1 million during the three and nine months ended September 30, 2015 . T he Company entered into a t hird w aiver a greement to the 2015 Credit Agreement in September 2016 to negotiate the amendment and restatement of certain covenants of the Company contained in the 2015 Credit Agreement. In connection with such negotiation, the lenders under the 2015 Credit Agreement had agreed to refrain from exercising certain rights under the 2015 Credit Agreement, including the declaration of a default and to forbear from acceleration of any repayment rights with respect to existing covenants until the parties have consummated the amendment and restatement of such provisions. In addition, certain payments required to be made under the 2015 Credit Agreement had been deferred while the parties negotiate d the amendment. The parties executed a second amendment to the 2015 Credit Agreement in November 2016 whereby the Company deferred further principal payments owed under the 2015 Credit Agreement in the amount of $380,000 per month until August 31, 2017. Additionally, the parties amended various clinical development milestones and added a covenant pursuant to which the Company is required to raise $40.0 million of additional equity capital by the end of the second quarter of 2017. All other material terms of the 2015 Credit Agreement, including the maturity date, remain the same. All other material terms of the 2015 Credit Agreement, including the maturity date, remain the same. As of the date hereof, the Company is not in default under the terms of the 2015 Credit Agreement. C. Second ‑Lien Convertible Debt In August 2015, in conjunction with the 2015 Credit Agreement, the Company incurred indebtedness pursuant to its offering of second ‑lien convertible PIK notes (“Second ‑Lien Convert”), to a syndicate of lenders , including the same two parties as the 2015 Credit Agreement. The Second ‑Lien Convert has a four year term under which the initial borrowings were $94.3 million, including $2.3 million in third - party fees that was settled through the issuance of Second ‑Lien Convert. In October 2015 and November 2015, the Company borrowed an additional $5.5 million and $15.0 million, respectively, and incurred $0.4 million in transaction costs under the Second ‑Lien Convert to three additional lenders , bringing the total borrowings under the Second ‑Lien Convert to $114.8 million, including $2.3 million in third - party fees. Interest is calculated at a rate of 13.0% and payable ‑in ‑kind semi ‑annually as an increase of principal. If the Company ha d not consummated an IPO of not less than $50.0 million and listed on a national stock exchange (“Qualified IPO”) on or before March 31, 2016, the interest rate was to automatically increase on April 1, 2016 by an additional 3.0% and by an additional 3.0% on each October 1 and April 1 until the interest rate equal ed 21.0% per annum, which would have remain ed the applicable interest rate so long as the Second ‑Lien Convert remain ed outstanding. The Company did not consummate a Q ualified IPO until August 1, 2016, therefore the additional 3% interest was applied from April 1, 2016 through August 1, 2016, the date on which the Second-Lien Convert converted into the Company’s common stock . The debt wa s secured by the tangible and intangible property of the Company. Holders of the Second ‑Lien Convert could elect to convert any portion of principal to Class A units at any time following the Company’s consummation of a Qualified IPO. The conversion price would have been equal to the product of (x) 90% and (y) the price per Class A u nit of the Company offered in a Qualified IPO provided, however, that the conversion price would have been capped at $12.00 . The Company could have redeem ed the Second ‑Lien Convert at its option, in whole or in part, at any time on or after the later of (x) the first anniversary of the issue date and (y) the date of the consummation of a Qualified IPO, at a redemption price of 150.0% of the principal amount, plus accrued and unpaid interest payable (at the Company’s option) in cash or Class A u nits. In addition, on or after the later of (x) the third anniversary of the issue date and (y) the date of the consummation of a Qualified IPO, the Company could have redeem ed the Second ‑Lien Convert at its option, in whole or in part, at a redemption price in cash of 110.0% of the principal amount, plus accrued and unpaid interest. Deferred financing costs of $4.2 million were recognized in recording the Second ‑Lien Convert and was being amortized to interest expense over the four year term of the agreement. There were no u namortized deferred financing costs at September 30, 2016 and $3.9 million of u namortized deferred financing costs at December 31, 2015 . Approximately $0.1 million and $0.7 million was charged to interest expense during the three and nine months ended September 30, 2016 , respectively. I nterest expense was $0.1 million during the three and nine months ended September 30, 2015 . The Company incurred $0.1 million in debt issuance costs to new creditors in August 2015 , which was recorded as a debt discount and was being amortized to interest expense over the four year term. The Company considered ASC 480, “Distinguishing Liabilities from Equity , ” and determined that the Second ‑Lien Convert does not contain any of the criteria under this guidance. In accordance with ASC 815, the Company determined that the interest rate increase and put/redemption feature do not require bifurcation since the embedded interest rate increase, if freestanding, would not qualify as a derivative. The Second ‑Lien Convert represent ed the host contract and the option to convert the debt into the Company’s Class A units represent ed the embedded conversion option. Since the conversion option meets the criteria under ASC 815, the conversion option does not require bifurcation and is not accounted for as a derivative under ASC 815. Pursuant to an amendment and restatement of the terms of the Second ‑Lien Convert in June 2016 , 100% of the outstanding balance under the outstanding Second ‑Lien Convert was mandatorily converted into shares of the Company’s common stock at a conversion price equal to 80% of the price per share of common stock in the IPO . During the third quarter of 2016, t he Company incur red a $32.4 million charge as a result of the beneficial conversion feature included in this agreement since the conversion price is equal to a 20% discount to the price per share of common stock in the IPO . The minimum payments required on the outstanding balances of the 2015 Credit Agreement as of September 30, 2016 are (in thousands): 2015 Credit Agreement 2016 $ 1,520 2017 4,560 2018 28,540 $ 34,620 The following table provides components of interest expense and other related financing costs: Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Interest expense and other financing costs $ 1,009 $ 2,039 $ 2,862 $ 7,090 Interest expense - beneficial conversion feature 45,915 — 45,915 — Interest paid-in kind 2,347 2,899 14,695 6,202 Write-off of deferred financing costs and debt discount 3,820 2,752 3,820 2,752 Amortization of deferred financing costs and debt discount 932 1,266 3,724 3,752 Interest expense $ 54,023 $ 8,956 $ 71,016 $ 19,796 |
Financial Instruments
Financial Instruments | 9 Months Ended |
Sep. 30, 2016 | |
Financial Instruments [Abstract] | |
Financial Instruments | 7 . Financial Instruments Success Fee In October 2011 , an executive officer and member of Kadmon Holdings, LLC issued an equity instrument for which the underlying value is based on 536,065 Class A units. The intrinsic value of the instrument is redeemable for cash upon certain defined liquidity or distribution events (“Success Fee”). No cash settlements associated with this instrument have occurred as of September 30, 2016 or December 31, 2015 . A liability was recorded based on the instrument’s fair value of $0 and $69,000 at September 30, 2016 and December 31, 2015 , respectively. As a result of marking to market this instrument, the Company recorded ($69,000) and ($0.2) million to change in fair value of financial instruments for the nine months ended September 30, 2016 and 2015 , respectively , and $0 and ($64,000) to change in fair value of financial instruments for the three months ended September 30, 2016 and 2015 , respectively. Upon consummation of the Company’s IPO on August 1, 2016 with a price per share of $12.00 per share, the fair value of this equity instrument had a fair value of $0, which resulted in no Success Fee owed by the Company. As there were no quoted prices for identical or similar instruments prior to the IPO , the Company ha d utilized a Black ‑Scholes calculation to value this instrument as of December 31, 2015 , based on the following assumptions: December 31, Input 2015 Unit price $5.00 Strike price $11.41 Volatility 79.20% Risk-free interest rate 0.49% Expected life .50 Years Expected dividend yield 0% Equity issued pursuant to Credit Agreements In connection with the incurrence of the Senior Convertible Term Loan , the Company issued three tranches of warrants as fees to the lenders that were redeemable for Class A units. The aggregate fair value of the warrants was $1.7 million and $1.9 million at September 30, 2016 and December 31, 2015 , respectively. The change in fair value of the warrants was ($0.2) million and ($1.3) million for the nine months ended September 30, 2016 and 2015 , respectively, and ( $0.6 ) million for the three months ended September 30, 2015 . There was no change in fair value of the warrants for the three months ended September 30, 2016. Upon consummation of the Company’s IPO on August 1, 2016 with a price per share of common stock in the IPO of $12.00 , the warrants to purchase Class A units issued to lenders in the Senior Convertible Term Loan were exchanged for 351,992 warrants to purchase the same number of shares of the Company’s common stock. Since the strike price was determined at IPO, the aggregate fair value of these warrants totaling $1.7 million was reclassified from liability to equity as of September 30, 2016 . As of December 31, 2015 the Company utilized a binomial model to measure all three warrant tranches. Due to the uncertainty o f the strike price of the warrants, the Company performed each calculation multiple times using a weighted number of units exercisable based on the Company’s best estimate of how many units would be issuable. The inputs used in the calculations to measure all three warrant tranches as of December 31, 2015 are as follow s: December 31, Input 2015 Unit price $5.00 Strike price $9.50 Volatility 79.18% Risk-free interest rate 0.49% Expected life .50 Years Expected dividend yield 0% In connection with the 2015 Credit Agreement, the Company issued warrants as fees to the lenders to purchase an aggregate of $6.3 million of the Company’s Class A units. The strike price of the warrants was 85% of the price per unit in an IPO or, if before an IPO, 85% of the deemed per unit equity value as defined in the 2015 Credit Agreement. The warrants were exercisable as of the earlier of an IPO or July 1, 2016. Since these warrants are also redeemable at the option of the holder after the 51 st month from the issue date, they are recorded as a liability of $4.5 million and $6.3 million as of September 30, 2016 and December 31, 2015 . Upon entry into the agreement in August 2015, the warrants issued to an existing lender was recorded to loss on extinguishment of debt of $900,000 and the warrants issued to the new lender was recorded as a debt discount of $5.4 million and will be amortized over the three year term (Note 6 ) in accordance with ASC 470. Upon consummation of the Company’s IPO on August 1, 2016 with a price per share of common stock in the IPO of $12.00, the warrants to purchase Class A units issued to lenders under the 2015 Credit Agreement were exchanged for 617,651 warrants to purchase the same number of shares of the Company’s common stock. None of these instruments have been exercised as of September 30, 2016 and December 31, 2015 . Other Warrants On April 16, 2013, the Company issued warrants with an estimated fair value of $1.4 million for the purchase of 30,000 Class A units at a strike price of $21.24 as consideration for fundraising efforts performed. Upon consummation of the Company’s IPO on August 1, 2016 and Corporate Conversion, these warrants to purchase Class A units were exchanged for 46,163 warrants to purchase the same number of shares of the Company’s common stock at a strike price of $138.06 . None of these warrants have been exercised as of September 30, 2016 and December 31, 2015 . Fair Value of Long ‑term Debt As of September 30, 2016 , the Company maintained a long- term secured term debt balance of $24.9 million. As of December 31, 2015 the Company maintained long ‑term secured term debt and long ‑term convertible debt balances of $26.3 million and $183.5 million, respectively. The underlying agreements for these balances were negotiated with parties that included fully independent third parties, at an interest rate which is con sidered to be in line with over- arching market conditions. Based on these factors management considers the carrying value of the debt to approximate fair value as of September 30, 2016 and December 31, 2015 . Fair Value Classification The Company held certain liabilities that are required to be measured at fair value on a recurring basis. Fair value guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: · Level 1—Quoted prices in active markets for identical assets or liabilities. · Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, 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. · 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 table below represents the values of the Company’s financial instruments as of September 30, 2016 and December 31, 2015 (in thousands): Fair Value Measurement Using: December 31, Significant Other Observable Inputs Significant Unobservable Inputs Description 2015 (Level 2) (Level 3) Warrants $ 8,220 $ — $ 8,220 Success Fee 69 — 69 Total $ 8,289 $ — $ 8,289 September 30, Significant Other Observable Inputs Significant Unobservable Inputs Description 2016 (Level 2) (Level 3) Warrants $ 4,534 $ 4,534 $ — Total $ 4,534 $ 4,534 $ — The table below represents a rollforward of the Level 2 and L evel 3 investments from January 1, 201 5 to September 30, 2016 (in thousands). Significant Other Observable Inputs Significant Unobservable Inputs (Level 2) (Level 3) Balance as of January 1, 2015 $ — $ 3,483 Change in fair value of financial instruments — (1,494) Fair value of warrants issued in connection with 2015 credit agreement — 6,300 Balance as of December 31, 2015 $ — $ 8,289 Transfer of warrants from Level 3 to Level 2 6,300 (6,300) Change in fair value of financial instruments (2,878) (273) Beneficial conversion feature recognized on warrants issued in connection with 2015 credit agreement 1,112 — Reclassification of warrants to APIC in connection with IPO — (1,716) Balance as of September 30, 2016 $ 4,534 $ — The Level 2 inputs used to value our financial instrument s were determined using prices that can be directly observed or corroborated in active markets. In August 2016, the warrants issued in connection with the 2015 Credit Agreement were transferred from L evel 3 to L evel 2 as the Company’s securities began trading on the New York Stock Exchange . Although the fair value of this obligation is calculated using the observable market price of Kadmon Holdings Inc. common stock , an active market for this financial instrument does not exist and therefore the Company has classified the fair value of this liability as a L evel 2 liability in the table above . |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2016 | |
Inventories [Abstract] | |
Inventories | 8. Inventories Inventories are stated at the lower of cost or market (on a first ‑in, first ‑out basis) using standard costs. Standard costs include an allocation of overhead rates, which include those costs attributable to managing the supply chain and are evaluated regularly. Variances are expensed as incurred. The Company regularly reviews the expiration date of its inventories and maintains a reserve for inventories that are probable to expire before shipment. Inventories recorded on the Company’s consolidated balance sheets are net of a reserve for expirable inventory of $4.8 million and $5.4 million at September 30, 2016 and December 31, 2015 , respectively. The Company expensed Ribasphere inventory that it believes will not be sold prior to reaching its product expiration date totaling $0.2 million and $1.2 million during the three months ended September 30, 2016 and 2015 , respectively, and $0.3 million and $2.1 million during the nine months ended September 30, 2016 and 2015 , respectively. If the amount and timing of future sales differ from management’s assumptions, adjustments to the estimated inventory reserves may be required. Inventories are comprised of the following (in thousands): September 30, December 31, 2016 2015 Raw materials $ 1,298 $ 1,905 Finished goods, net 982 1,563 Total inventories $ 2,280 $ 3,468 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 9 Months Ended |
Sep. 30, 2016 | |
Goodwill and Other Intangible Assets [Abstract] | |
Goodwill and Other Intangible Assets | 9 . Goodwill and Other Intangible Assets The changes in the carrying amount of goodwill and other amortizable intangible assets for the nine months ended September 30, 2016 and the year ended December 31, 2015 are as follows (in thousands): Balance as of December 31, 2014 Amortization Impairment Balance as of December 31, 2015 Remaining Useful Life as of December 31, 2015 Ribasphere product rights $ 73,934 $ (27,442) $ (31,269) $ 15,223 1.0 Goodwill $ 3,580 $ — $ — $ 3,580 — Balance as of December 31, 2015 Amortization Impairment Balance as of September 30, 2016 Remaining Useful Life as of September 30, 2016 Ribasphere product rights $ 15,223 $ (12,470) $ — $ 2,753 0.25 Goodwill $ 3,580 $ — $ — $ 3,580 — Amortization exp ense is included within selling, general and administrative expenses on the Company’s consolidated statements of operations. The Company recorded amortization expense related to the intangible asset of $12.5 million and $22.2 million for the nine months ended September 30, 2016 and 2015 , respectively, and $3.5 million and $7.4 million for the three months ended September 30, 2016 and 2015 , respectively. The accumulated amortization of the intangible asset was $138.0 million and $125.5 million as of September 30, 2016 and December 31, 2015 , respectively. The remaining $2.8 million balance in the intangible asset as of September 30, 2016 will be amortized through December 2016. |
License Agreements
License Agreements | 9 Months Ended |
Sep. 30, 2016 | |
License Agreements [Abstract] | |
License Agreements | 10 . License Agreements The Company’s license agreements are disclosed in the audited financial statements as of and for the year ended December 31, 2015 included in the Final Prospectus. Since the date of such financial statements, there have been no changes to the Company’s license agreements, other than those described below. Yale University On February 4, 2011, the Company entered into a license agreement with Yale University, whereby the Company obtained the worldwide exclusive license and right to make, use, sell, import and export PHY906, a development stage botanical compound, and the related technology. In April 2016, the Company entered into a mutual termination agreement with Yale University. All rights and licenses granted under the agreement were immediately terminated and revert ed to the party granting such rights. Valeant Holdings International On February 25, 2014, the Company entered into an agreement with Valeant for the co ‑promotion of Syprine ® , a chelation therapy indicated in the treatment of patients with Wilson’s disease who are intolerant of penicillamine. In February 2016, the Company entered into a mutual termination agreement with Valeant. Upon termination, neither party shall have any rights or obligation including any and all past, present and future payments. Additionally, all rights and licenses granted under the agreement were immediately terminated and revert ed to the party granting such rights. As a result of the termination, in February 2016 the Company recorded a gain on settlement of the $3.9 million other milestone payable to Valeant in connection with the acquisition of the drug Infergen . Vivus, Inc. In June 2015, the Company entered into an agreement with Vivus Inc. (“ Vivus ”) for the co ‑promotion of Qsymia ® , a combination of phentermine and topiramate extended ‑release indicated as an adjunct to a reduced ‑calorie diet and increased physical activity for chronic weight management in adults. In November 2016, the Company notified Vivus that it will not renew this agreement and therefore the agreement will terminate on December 31, 2016. No meaningful revenue has been generated from this agreement as of September 30, 2016 . MeiraGTx L imited In April 2015, we executed several agreements which transferred our ownership of Kadmon Gene Therapy, LLC to MeiraGTx, a then wholly ‑owned subsidiary of our company. As part of these agreements, we also transferred various property rights, employees and management tied to the ongoing development of the intellectual property and contracts identified in the agreements to MeiraGTx. The summarized financial information for MeiraGTx Limited (“MeiraGTx”) as of and for the year ended December 31, 2015 is as follows (amounts in thousands): Balance Sheet Data: Cash $ 14,548 Other current assets 433 Noncurrent assets 42 Current liabilities 4,621 Noncurrent liabilities 17 Total stockholders’ equity 9,249 Statement of Operations Data: General and administrative expense $ 4,184 Research and development expense 9,876 Net loss attributable to non ‑ controlling interest in subsidiary 829 Net loss and comprehensive loss (13,154) The Company assessed the recoverability of the investment in MeiraGTx as of September 30, 2016 and December 31, 2015 and identified no events or changes in circumstances that may have a significant adverse impact on the fair value of this investment. From April 2015 through December 31, 2015 the Company recorded a loss on investment of $2.8 million and retained a 44.4% ownership in MeiraGTx at December 31, 2015. For the nine months ended September 30, 2016 and 2015 , the Company recorded its share of MeiraGTx’s net loss of $12.3 million and $1.1 million, respectively, inclusive of adjustments related to MeiraGTx’s 2015 financial statements that resulted in the Company recording a loss on equity method investment of $5.1 million for the nine months ended September 30, 2016 . For the three months ended September 30, 2016 and 2015 , the Company recorded its share of MeiraGTx’s net loss of $1.7 million and $0.5 million, respectively. The Company maintains a 38.7% ownership in MeiraGTx as of September 30, 2016 . The Company’s maximum exposure associated with MeiraGTx is limited to its initial investment of $24.0 million. Chiromics On November 18, 2011 the Company entered into a non ‑exclusive, royalty free license agreement with Chiromics LLC (“Chiromics”) for access to two chemical compound libraries for the research, discovery and development of biological and/or pharmaceutical products. The Company was required to pay $200,000 upon execution of the agreement and $150,000 following the delivery of each of the chemical compounds included within the related library. The Company was additionally required to make quar terly payments of $200,000 for the eight quarters following delivery of all compounds; such payments were expensed to research and development expense in those quarters. The payable balance associated with these agreements wa s $500,000 at September 30, 2016 and December 31, 2015 , which was settled in October 2016 . Concordia On December 16, 2011, the Company purchased certain intellectual property rights and associated contractual rights and obligations from Concordia Pharmaceuticals, LLC . (“Concordia”) for $500,000 . In May 2016, the Company entered into a mutual termination agreement with Concordia. All rights and licenses granted under the agreement were immediately terminated and revert ed to the party granting such rights. EffRx On March 12, 2014 the Company entered into a development and license agreement with EffRx Pharmaceuticals S.A. (“EffRx”) for the development of effervescent formulations of certain pharmaceutical products. This agreement was mutually terminated on April 6, 2016. Zydus In June 2008, the Company entered into an asset purchase agreement with Zydus Pharmaceuticals USA, Inc. (“Zydus”) and Cadila Healthcare Limited where the Company purchased all of Zydus’ rights, title and interest to high dosages of ribavirin. Under the terms of the agreement, the Company paid a one ‑time purchase price of $1.1 million. The Company was required to pay a royalty based on net sales of products in the low twenty percents, subject to specified reductions and offsets. In April 2013, the Company entered into an amendment to the asset purchase agreement with Zydus which reduced the royalty payable on net sales of products from the low twenty percents to the mid-teens percents. In June 2008, the Company also entered into a non ‑exclusive patent license agreement with Zydus, under which Zydus granted to the Company a non ‑exclusive, royalty free, fully paid up, non ‑transferable license under certain Zydus patent rights related to ribavirin. This agreement will expire upon the expiration or termination of a specific licensed patent. Either party may terminate the agreement for any material breach by the other party that is not cured within a specified time period or upon the bankruptcy or insolvency of the other party. The Company recorded royalty expense of $1.1 million and $2.1 million for the nine months ended September 30, 2016 and 2015 , respectively, and $0.3 million and $0.7 million for the three months ended September 30, 2016 and 2015 , respectively. Jinghua In November 2015, the Company entered into a license agreement with Jinghua Pharmaceutical Group Co., Ltd. (“ Jinghua ”). Under this agreement, the Company granted to Jinghua an exclusive, royalty ‑bearing, sublicensable license under certain of its intellectual property and know ‑how to use, develop, manufacture, and commercialize certain monoclonal antibodies in China, Hong Kong, Macau and Taiwan. In partial consideration for the rights granted to Jinghua under the agreement, the Company received an upfront payment of $10.0 million in the form of an equity investment in Class E redeemable convertible units of the Company. The Company is eligible to receive from Jinghua a royalty equal to a percentage of net sales of product in the territory in the low ten percents. In addition to such payments, the Company is eligible to receive milestone payments for the achievement of certain development milestones, totaling up to $40.0 million. The Company earned a $2.0 million milestone payment in March 2016, which was recorded as license and other revenue during the nine months ended September 30, 2016 . The Company is also eligible to receive a portion of sublicensing revenue from Jinghua ranging from the low ten percents to the low thirty percents based on the development stage of a product. No such revenue was earned during the three and nine months ended September 30, 2016 and 2015 . The Company’s agreement with Jinghua will continue on a product ‑by ‑product and country ‑by ‑country basis until the later of ten years after the first commercial sale of the product in such country or the date on which there is no longer a valid claim covering the licensed antibody contained in the product in such country. Either party may terminate the agreement for any material breach by the other party that is not cured within a specified time period or upon the bankruptcy or insolvency of the other party. Camber Pharmaceuticals, Inc. Tetrabenazine In February 2016, the Company entered into a supply and distribution agreement with Camber Pharmaceuticals, Inc. (“Camber”) for the purposes of marketing, selling and distributing tetrabenazine, a medicine that is used to treat the involuntary movements (chorea) of Huntington’s disease. The initial term of the agreement is twelve months. Under the agreement, the Company will obtain commercial supplies of tetrabenazine and will distribute tetrabenazine through its existing sales force and commercial network. The Company will pay Camber a contracted price for supply of tetrabenazine and will retain 100% of the revenue generated from the sale of tetrabenazine. The Company recognized revenue of $ 0.3 million and $0.4 million during the three and nine months ended September 30, 2016 , respectively. No revenue was generated from sales of tetrabenazine in 2015. Valganciclovir In May 2016, the Company amended its agreement with Camber to include the marketing, selling and distributing of valganciclovir, a medicine that is used for the treatment of cytomegalovirus (CMV) retinitis, a viral inflammation of the retina of the eye, in patients with acquired immunodeficiency syndrome (AIDS) and for the prevention of CMV disease, a common viral infection complicating solid organ transplants, in kidney, heart and kidney pancreas transplant patients. The Company will pay Camber a contracted price for supply of valganciclovir and will retain 100% of the revenue generated from the sale of valganciclovir. The Company recognized revenue of $0.5 million and $0.7 million during the three and nine months ended September 30, 2016 , respectively. No revenue was generat ed from sales of valganciclovir in 2015 . Abacavir, Entecavir, Lamivudine, Lamivudine (HBV) and Lamivudine and Zidovudine. In August 2016, the Company amended its agreement with Camber to include the marketing, selling and distributing of Abacavir tablets, USP, a medicine that is used in combination with other antiretroviral agents for the treatment of human immunodeficiency virus type-1 (HIV-1) infection; Entecavir, a medicine that is used for the treatment of chronic hepatitis B virus (HBV) infection in adults with evidence of active viral replication and either evidence of persistent elevations in serum aminotransferases (ALT or AST) or histologically active disease; Lamivudine tablets, a nucleoside analogue medicine used in combination with other antiretroviral agents for the treatment of human immunodeficiency virus (HIV-1) infection; Lamivudine tablets (HBV), a medicine that is used for the treatment of chronic hepatitis B virus (HBV) infection associated with evidence of hepatitis B viral replication and active liver inflammation; and Lamivudine and Zidovudine tablets, USP, a combination of two nucleoside analogue medicines, used in combination with other antiretrovirals for the treatment of human immunodeficiency virus type 1 (HIV-1) infection. The Company will pay Camber a contracted price for supply of these products and will retain 100% of the revenue generated from the sale of these products. No meaningful revenue was generated from sales of these products for the nine months ended September 30, 2016 . |
Share-based Compensation
Share-based Compensation | 9 Months Ended |
Sep. 30, 2016 | |
Share-based Compensation [Abstract] | |
Share-based Compensation | 11 . Share ‑based Compensation 2011 Equity Incentive Plan—Options The 2011 Equity Incentive Plan was adopted in July 2011. Under this plan, the Company’s board of managers was able to grant unit ‑based awards to certain employees, officers, directors, managers, consultants and advisors. The plan was amended on November 7, 2013 to authoriz e the grant of a number of options to purchase Class A units equal to 7.5% of the outstanding C lass A units calculated on a fully diluted basis. As of December 31, 2015 the number of additional units available for grant was 2,715,099 . The Company’s board of managers ha d the authority, in its discretion, to determine the terms and conditions of any option grant, including the vesting schedule. Effective July 26, 2016, n o award may be granted under the 2011 Equity Plan. The 2011 Equity Plan was merged with and into the 2016 Equity Incentive Plan, outstanding awards wer e converted into awards with respect to our common stock and any new awards will be issued under the terms of the 2016 Equity Incentive Plan. 2016 Equity Incentive Plan The Company’s 2016 Equity Incentive Plan ( the “ 2016 Equity Plan ”) , was approved by the Company’s board of managers and holders of the Company’s membership units in July 2016. It is intended to make available incentives that will assist the Company to attract, retain and motivate employees, including officers, consultants and directors. The Company may provide these incentives through the grant of stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares and units and other cash-based or stock-based awards. A total of 6,720,000 shares of the Company’s common stock was initially authorized and reserved for issuance under the 2016 Equity Plan. This reserve will automatically increase on January 1, 2017 and each subsequent anniversary through January 1, 2025, by an amount equal to the smaller of (a) 4% of the number of shares of common stock issued and outstanding on the immediately preceding December 31, or (b) an amount determined by the board of directors . This reserve was increased to include any shares issuable upon exercise of options granted under the Company’s 2011 Equity Incentive Plan that expire or terminate without having been exercised in full. Appropriate adjustments will be made in the number of authorized shares and other numerical limits in the 2016 Equity Plan and in outstanding awards to prevent dilution or enlargement of participants ’ rights in the event of a stock split or other change in the Company’s capital structure. Shares subject to awards which expire or are cancelled or forfeited will again become available for issuance under the 2016 Equity Plan. The shares available will not be reduced by awards settled in cash or by shares withheld to satisfy tax withholding obligations. Only the net number of shares issued upon the exercise of stock appreciation rights or options exercised by means of a net exercise or by tender of previously owned shares will be deducted from the shares available under the 2016 Equity Plan. The 2016 Equity Plan will be generally administered by the compensation committee of the Company’s board of directors. Subject to the provisions of the 2016 Equity Plan, the compensation committee will determine in its discretion the persons to whom and the times at which awards are granted, the sizes of such awards and all of their terms and conditions. However, the compensation committee may delegate to one or more of our officers the authority to grant awards to persons who are not officers or directors, subject to certain limitations contained in the 2016 Equity Plan and award guidelines established by the compensation committee . The compensation committee will have the authority to construe and interpret the terms of the 2016 Equity Plan and awards granted under it. The 2016 Equity Plan provides, subject to certain limitations, for indemnification by the Company of any director, officer or employee against all reasonable expenses, including attorneys ’ fees, incurred in connection with any legal action arising from such person's action or failure to act in administering the 2016 Equity Plan. Awards may be granted under the 2016 Equity Plan to the Company’s employees, including officers, directors or consultants or those of any present or future parent or subsidiary corporation or other affiliated entity. All awards will be evidenced by a written agreement between the Company and the holder of the award and may include any of the following: · Stock options. The Company may grant nonstatutory stock options or incentive stock options as described in Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”) , each of which gives its holder the right, during a specified term (not exceeding 10 years) and subject to any specified vesting or other conditions, to purchase a number of shares of our common stock at an exercise price per share determined by the administrator, which may not be less than the fair market value of a share of the Company’s common stock on the date of grant. · Stock appreciation rights. A stock appreciation right gives its holder the right, during a specified term (not exceeding 10 years) and subject to any specified vesting or other conditions, to receive the appreciation in the fair market value of the Company’s common stock between the date of grant of the award and the date of its exercise. The Company may pay the appreciation in shares of the Company’s common stock or in cash. · Restricted stock. The administrator may grant restricted stock awards either as a bonus or as a purchase right at such price as the administrator determines. Shares of restricted stock remain subject to forfeiture until vested, based on such terms and conditions as the administrator specifies. Holders of restricted stock will have the right to vote the shares and to receive any dividends paid, except that the dividends may be subject to the same vesting conditions as the related shares. · Restricted stock units. Restricted stock units represent rights to receive shares of the Company’s common stock (or their value in cash) at a future date without payment of a purchase price, subject to vesting or other conditions specified by the administrator. Holders of restricted stock units have no voting rights or rights to receive cash dividends unless and until shares of common stock are issued in settlement of such awards. However, the administrator may grant restricted stock units that entitle their holders to dividend equivalent rights. · Performance shares and performance units. Performance shares and performance units are awards that will result in a payment to their holder only if specified performance goals are achieved during a specified performance period. Performance share awards are rights whose value is based on the fair market value of shares of the Company’s common stock, while performance unit awards are rights denominated in dollars. The administrator establishes the applicable performance goals based on one or more measures of business performance enumerated in the 2016 Equity Plan, such as revenue, gross margin, net income or total stockholder return. To the extent earned, performance share and unit awards may be settled in cash or in shares of our common stock. Holders of performance shares or performance units have no voting rights or rights to receive cash dividends unless and until shares of common stock are issued in settlement of such awards. However, the administrator may grant performance shares that entitle their holders to dividend equivalent rights. · Cash-based awards and other stock-based awards. The administrator may grant cash-based awards that specify a monetary payment or range of payments or other stock-based awards that specify a number or range of shares or units that, in either case, are subject to vesting or other conditions specified by the administrator. Settlement of these awards may be in cash or shares of our common stock, as determined by the administrator. Their holder will have no voting rights or right to receive cash dividends unless and until shares of our common stock are issued pursuant to the award. The administrator may grant dividend equivalent rights with respect to other stock-based awards. In the event of a change in control as described in the 2016 Equity Plan, the acquiring or successor entity may assume or continue all or any awards outstanding under the 2016 Equity Plan or substitute substantially equivalent awards. Any awards which are not assumed or continued in connection with a change in control or are not exercised or settled prior to the change in control will terminate effective as of the time of the change in control. The compensation committee may provide for the acceleration of vesting of any or all outstanding awards upon such terms and to such extent as it determines, except that the vesting of all awards held by members of the board of directors who are not employees will automatically be accelerated in full. The 2016 Equity Plan also authorize s the compensation committee , in its discretion and without the consent of any participant, to cancel each or any outstanding award denominated in shares upon a change in control in exchange for a payment to the participant with respect to each share subject to the cancelled award of an amount equal to the excess of the consideration to be paid per share of common stock in the change in control transaction over the exercise price per share, if any, under the award. The 2016 Equity Plan will continue in effect until it is terminated by the administrator, provided, however, that all awards will be granted, if at all, within 10 years of its effective date. The administrator may amend, suspend or terminate the 2016 Equity Plan at any time, provided that without stockholder approval, the plan cannot be amended to increase the number of shares authorized, change the class of persons eligible to receive incentive stock options, or effect any other change that would require stockholder approval under any applicable law or listing rule. Total unrecognized compensation expense related to unvested options granted under the Company’s share ‑based compensation plan was $15.6 million and $18.6 million at September 30, 2016 and December 31, 2015 , respectively. That expense is expected to be recognized over a weighted average period of 1.6 years and 2.1 years as of September 30, 2016 and December 31, 2015 , respectively. The Company recorded share ‑based option compensation expense under the 2011 Equity Incentive Plan of $41.4 million and $4.7 million for the nine months ended September 30, 2016 and 2015 , respectively, and $35.5 million and $1.3 million for the three months ended September 30, 2016 and 2015 , respectively. In January 2015, the compensation committee of the Company ’ s board of managers approved the amendments of all outstanding option awards under the 2011 Equity Incentive Plan that have an exercise price above $6.00 per unit to adjust the exercise price per unit to $6.00 per unit (Note 3 ), the estimated fair value of the Company ’s Class A units as of October 31, 2014. The awarded options have the same vesting schedule as the original award. The amendment to the option awards resulted in a modification charge of $1.1 million, of which $668,000 was expensed immediately during the first quarter of 2015 and the remaining amount will be recognized over the vesting periods of each award. These vesting periods range from one to two years. On July 13, 2016, the compensation committee of the Company ’ s board of managers approved the amendment of all outstanding option awards issued under the Company ’ s 2011 Equity Incentive Plan whereby, effective upon pricing of the Company ’ s IPO, the exercise price (on a post-Corporate Conversion, post-split basis) was adjusted to equal the price per share of the Company ’ s common stock in the IPO. The amendment was made to the awards as the original exercise price was substantially higher than the price of the Company ’ s common stock in the IPO as a result of changes in the Company ’ s capital structure t hat occur red upon IPO. Options to purchase an aggregate of approximately 1.6 million shares of the Company ’ s Class A units were modified. Following this modification, the previously granted options will have the same vesting schedule as the original award and are modified on a one-for-one basis. The modification result ed in a $4.0 million charge, of which the incremental value of the previously vested portion of the awards totaling $1.8 million was expensed immediately during the third quarter of 2016 and the remaining $2.2 million will be recognized over the remaining vesting periods of each award. These vesting periods range from one to three years. The following table summarizes information about unit options outstanding at September 30, 2016 and December 31, 2015 : Options Outstanding Options Exercisable Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value (in thousands) Number of Options Weighted Average Exercise Price Balance, December 31, 2014 706,460 $ 52.15 8.63 $ — 266,518 $ 50.50 Granted 1,154,394 37.44 Exercised (772) 38.70 Forfeited (174,834) 57.68 Balance, December 31, 2015 1,685,248 $ 37.38 8.72 $ — 381,072 $ 36.29 Granted 1,630,536 12.00 Exercised (1,109) 36.63 Forfeited (68,932) 35.46 Balance, September 30, 2016 3,245,743 $ 12.00 8.90 $ — 2,022,936 $ 12.00 The aggregate intrinsic value in the table above represents the total pre ‑tax intrinsic value calculated as the difference between the fair value of the Company’s common stock at September 30, 2016 ( $7.34 per share ) and the exercise price, multiplied by the related in ‑the ‑money options that would have been received by the option holders had they exercised their options at the end of the fiscal year. This amount changes based on the fair value of the Company’s common stock . There were 1,109 options exercised during the nine months ended September 30, 2016 that were not in ‑the ‑money. There were 772 options exercised during 2015 that were in ‑the ‑money, with an aggregate intrinsic value at time of exercise of $4,800 . During the nine months ended September 30, 2016 , 1,630,536 options were granted to the Company’s Chief Executive Officer. The weighted ‑average fair value of the stock option awards granted to employees, officers, directors and advisors was $7.60 during the nine months ended September 30, 2016 and $20.67 during the year ended December 31, 2015 and was estimated at the date of grant using the Black ‑Scholes option ‑pricing model and the assumptions noted in the following table: Nine Months Ended Year Ended September 30, 2016 December 31, 2015 Weighted average fair value of grants $7.60 $20.67 Expected volatility 79.35% 77.23% - 93.85% Risk-free interest rate 1.15% 1.54% - 1.93% Expected life 5.0 years 5.2 - 6.0 years Expected dividend yield 0% 0% In December 2014, the Company ’ s board of managers approved an option grant to the C hief E xecutive O fficer with an exercise price of $39.00 to purchase a number of units equal to 5% of the total issued and outstanding units of the Company (after, in the event of an IPO, giving effect to the exercise and conversion of certain exercisable and convertible securities and after giving effect to consummating the IPO) calculated on the earliest to occur of 1) a sale of the Company, 2) the date on which the Company consummates an IPO and 3) the date the key employee ceases to be a service provider to the Company. This option grant was issued in March 2015 when the terms of the agreement were finalized. Since the grant was contingent on a liquidity event, a grant date had not been established and therefore no compensation expense was initially recorded. In December 2015, the option agreement entered into with the Company’s Chief Executive Officer was replaced in its entirety by an option agreement dated December 31, 2015 so that the number of units is set to 769,231 unit options valued at $15.2 million which will be recognized as compensation expense over the vesting term. These units under this option agreement were issued outside of the 2011 Equity Incentive Plan. The Company expensed $5.9 million and $5.1 million during the nine months ended September 30, 2016 and fourth quarter of 2015, respectively, and the remaining amount will be recognized ratably through August 2017. The options vest 1/3 at the grant date, 1/3 in August 2016 and 1/3 in August 2017. While the awards vest over this term they are not exercisable until the occurrence of the Calculation Date. The Calculation Date is defined as the earliest to occur of 1) a sale of the Company (as defined in the Company’s second amended and restated limited liability company agreement dated as of June 27, 2014), 2) the date on which the Company consummates an IPO and 3) the date the key employee ceases to be a service provider to the Company. On July 13, 2016, the compensation committee of the Company ’ s board of managers approved an option award for Harlan W. Waksal, M.D. increasing the number of options (giving effect to the Corporate Conversion) subject to his original option grant. The number of shares subject to this option award shall equal the difference between the 769,231 options originally granted to Harlan W. Waksal, M.D. and 5% of the Company ’ s outstanding common equity determined on a fully diluted basis on the IPO date , which amounted to 1,630,536 options . The effective date of the new option award was the IPO date of July 26, 2016 . The exercise price per share of common stock subject to the new incremental options awarded was equal to the IPO price per share of common stock at the IPO date of $12.00 . The option award was subject to the same vesting schedule applicable to the original option grant such that all options awarded will vest on August 4, 2017. In consideration for the new option award, Harlan W. Waksal, M.D. has committed to perform an additional year of service in connection with receipt of the additional option shares. In the event Harlan W. Waksal, M.D. voluntarily terminates his employment prior to completion of this additional year of service, Harlan W. Waksal, M.D. shall forfeit 25% of the additional options, or 25% of the aggregate additional option gain associated with the additional option shares in the event the options are exercised, as applicable. This modification result ed in a $12.4 million charge, of which the incremental value of the previously vested portion of the awards totaling $8.3 million was expensed during the third quarter of 2016 and the remaining amount of the unvested portion totaling $4.1 million will be recognized over the additional two year s of service. 2014 Long ‑term Incentive Plan (“LTIP”) The LTIP was adopted in May 2014 and amended in December 2014. Under the LTIP, the Company ’ s board of managers may grant up to 10% of the equity value of the Company including the following types of awards: · Equity Appreciation Rights Units (“EAR units”) whereby the holder would possess the right to a payment equal to the appreciation in value of the designated underlying equity from the grant date to the determination date. Such value is calculated as the product of the excess of the fair market value on the determination date of one EAR unit over the base price specified in the grant agreement and the number of EAR units specified by the award, or, when applicable, the portion thereof which is exercised. · Performance Awards which become payable on the attainment of one or more performance goals established by the Plan Administrator. No performance period shall end prior to an IPO or Change in Control (the “Determination Date”). The Company ’ s board of managers has the authority, at its discretion, to determine the terms and conditions of any LTIP grant, including vesting schedule. Certain key employees were granted a total of 1,250 EAR units and 8,500 EAR units with a base price of $6.00/unit , expiring 10 years from the grant date (the “Award”) during 2015 and 2014, respectively. Each unit entitles the holder to a payment amount equal to 0.001% of the fair market value of all of the outstanding equity in the Company on a fully diluted basis assuming the exercise of all derivative securities as of the Determination Date. The number of EAR units shall be adjusted to equal a certain percentage of the Company’s outstanding common equity securities determined on the first trading date following the Determination Date. The EAR units vest based on the earlier of (a) the expiration date if an IPO is consummated on or before that date or (b) the date of a change in control that occurs after the submission date of a Form S ‑1 registration statement to the SEC but prior to the expiration date. The EAR units also vest upon achieving certain predetermined stock price targets subject to continuing service through the date of the Form S ‑1 submission. The payment amount with respect to the holder’s EAR units will be determined using the fair market value of the common stock on the trading date immediately preceding the settlement date. Each payment under the Award will be made in a lump sum and is considered a separate payment. The Company reserves the right to make payment in the form of common stock following the consummation of an IPO or in connection with a change in control, subject to the terms of the LTIP. Any settlement in the form of common stock will be limited to a maximum share allocation. The holder has no right to demand a particular form of payment. A total of 9,750 units were granted under the LTIP at September 30, 2016 and December 31, 2015 . The liability and associated compensation expense for this award was recognized upon consummation of the Company’s IPO on August 1, 2016. No compensation expense ha d been recorded prior to this date. The Company utilized a Monte-Carlo simulation to determine the fair value of the awards granted under the LTIP of $22.6 million, which was recorded as shared-based compensation during the third quarter of 2016 as these awards are not forfeitable. 2016 Employee Stock Purchase Plan (“2016 ESPP”) The Company’s board of managers has adopted and the Company’s stockholders have approved the 2016 ESPP. A total of 1,125,000 shares of the Company’s common stock are available for sale under the 2016 ESPP. In addition, the 2016 ESPP provides for annual increases in the number of shares available for issuance under the 2016 ESPP on January 1, 2017 and each subsequent anniversary through 2025, equal to the smallest of: · 750,000 shares; · 1.5% of the outstanding shares of the Company’s common stock on the immediately preceding December 31; or · such other amount as may be determined by the Company’s board of directors. Appropriate adjustments will be made in the number of authorized shares and in outstanding purchase rights to prevent dilution or enlargement of participants ’ rights in the event of a stock split or other change in the Company’s capital structure. Shares subject to purchase rights which expire or are cancelled will again become available for issuance under the 2016 ESPP. The compensation committee of the Company’s board of directors will administer the 2016 ESPP and have full authority to interpret the terms of the 2016 ESPP. The 2016 ESPP provides, subject to certain limitations, for indemnification by the Company of any director, officer or employee against all reasonable expenses, including attorneys ’ fees, incurred in connection with any legal action arising from such person ’ s action or failure to act in administering the 2016 ESPP. All of the Company’s employees, including the Company’s named executive officers, and employees of any of the Company’s subsidiaries designated by the compensation committee are eligible to participate if they are customarily employed by the Company or any participating subsidiary for at least 20 hours per week and more than five months in any calendar year, subject to any local law requirements applicable to participants in jurisdictions outside the United States. However, an employee may not be granted rights to purchase stock under the 2016 ESPP if such employee: · immediately after the grant would own stock or options to purchase stock possessing 5.0% or more of the total combined voting power or value of all classes of the Company’s capital stock; or · holds rights to purchase stock under all of the Company’s employee stock purchase plans that would accrue at a rate that exceeds $25,000 worth of the Company’s stock for each calendar year in which the right to be granted would be outstanding at any time. The 2016 ESPP is intended to qualify under Section 423 of the Code but also permits us to include our non-U.S. employees in offerings not intended to qualify under Section 423. The 2016 ESPP will typically be implemented through consecutive six-month offering periods. The offering periods generally start on the first trading day of April and October of each year. The administrator may, in its discretion, modify the terms of future offering periods, including establishing offering periods of up to 27 months and providing for multiple purchase dates. The administrator may vary certain terms and conditions of separate offerings for employees of the Company’s non-U.S. subsidiaries where required by local law or desirable to obtain intended tax or accounting treatment. The 2016 ESPP permits participants to purchase common stock through payroll deductions of up to 10.0% of their eligible compensation, which includes a participant ’ s regular and recurring straight time gross earnings and payments for overtime and shift premiums, but exclusive of payments for incentive compensation, bonuses and other similar compensation. Amounts deducted and accumulated from participant compensation, or otherwise funded in any participating non-U.S. jurisdiction in which payroll deductions are not permitted, are used to purchase shares of the Company’s common stock at the end of each offering period. The purchase price of the shares will be 85.0% of the lower of the fair market value of the Company’s common stock on the first trading day of the offering period or on the last day of the offering period. Participants may end their participation at any time during an offering period and will be paid their accrued payroll deductions that have not yet been used to purchase shares of common stock. Participation ends automatically upon termination of employment with the Company . Each participant in any offering will have an option to purchase for each full month contained in the offering period a number of shares determined by dividing $2,083 by the fair market value of a share of the Company’s common stock on the first day of the offering period or 200 shares, if less, and except as limited in order to comply with Section 423 of the Code. Prior to the beginning of any offering period, the administrator may alter the maximum number of shares that may be purchased by any participant during the offering period or specify a maximum aggregate number of shares that may be purchased by all participants in the offering period. If insufficient shares remain available under the plan to permit all participants to purchase the number of shares to which they would otherwise be entitled, the administrator will make a pro rata allocation of the available shares. Any amounts withheld from participants ’ compensation in excess of the amounts used to purchase shares will be refunded, without interest. A participant may not transfer rights granted under the 2016 ESPP other than by will, the laws of descent and distribution or as otherwise provided under the 2016 ESPP. In the event of a change in control, an acquiring or successor corporation may assume the Company’s rights and obligations under outstanding purchase rights or substitute substantially equivalent purchase rights. If the acquiring or successor corporation does not assume or substitute for outstanding purchase rights, then the purchase date of the offering periods then in progress will be accelerated to a date prior to the change in control. The 2016 ESPP will continue in effect until terminated by the administrator. The compensation committee has the authority to amend, suspend or terminate the 2016 ESPP at any time. Warrants The following table summarizes information about warrants outstanding at September 30, 2016 and December 31, 2015 : Warrants Weighted Average Exercise Price Balance, December 31, 2015 710,801 $ 46.64 Granted 617,651 10.20 Exercised — — Forfeited — — Balance, September 30, 2016 1,328,452 $ 29.70 In conjunction with 2015 Credit Agreement, warrants to purchase $6.3 million of Class A units were issued to two lenders at 85% of the price per share of common stock in the IPO. Upon consummation of the Company’s IPO on August 1, 2016 with a price per share of common stock in the IPO of $12.00, these warrants to purchase Class A units were exchanged for 617,651 warrants at a strike price of $10.20 to purchase the same number of shares of the Company’s common stock (see Note 7) . |
Accrued Expenses and Other Shor
Accrued Expenses and Other Short Term Liabilities | 9 Months Ended |
Sep. 30, 2016 | |
Accrued Expenses and Other Short Term Liabilities [Abstract] | |
Accrued Expenses and Other Short Term Liabilities | 12 . Accrued Expenses and Other Short Term Liabilities Short ‑term accrued expenses as of September 30, 2016 and December 31, 2015 include the following (in thousands): September 30, December 31, 2016 2015 Commission payable $ 2,695 $ 2,820 Accrued bonus 393 362 Severance 1,555 578 Other compensation and benefits 778 956 Financing/Offering Costs — 1,250 Threatened litigation — 10,377 Royalty arrangements 3,309 2,777 Other 3,707 3,100 Total Accrued Expenses $ 12,437 $ 22,220 Commission Payable In November 2015, the Company entered into an agreement with a lender whereby the Company borrowed $15.0 million under the Second ‑Lien Convert and incurred a $600,000 commission fee to a third party, which was accrued for at December 31, 2015 , of which $300,000 is payable in cash and was still accrued for at September 30, 2016 and $300,000 wa s payable in Class A units with a fair value of $125,000 , which was settled through the issuance of 25,000 Class A units in February 2016. During 2015, the Company raised $873,000 in gross proceeds, $833,000 net of $40,000 in transaction costs, through the issuance of 75,875 Class E redeemable convertible units. As of September 30, 2016 and December 31, 2015 , $40,000 remains in accrued liabilities relating to commissions to third parties for Class E redeemable convertible raises during 2015. During 2014, the Company raised $39.5 million in gross proceeds, $36.4 million net of $3.1 million in transaction costs, through the issuance of 3,438,984 Class E redeemable convertible units. Of the $3.1 million in transaction costs, $2.4 million remains in accrued liabilities as of September 30, 2016 and December 31, 2015 relating to commissions to third parties for Class E redeemable convertible raises during 2014. Accrued Bonus Accrued bonus balances represent anticipated bonus compensation to be paid to employees resulting from past services performed. Severance Severance balances represent contractual compensation to be paid to former employees, a significant portion of which relates to the separation agreement with Dr. Samuel D. Waksal. Effective as of February 8, 2016, Dr. Samuel D. Waksal resigned from all positions with the Company and is no longer employed by the Company in any capacity. As of September 30, 2016 , accrued severance payments payable to Dr. Samuel D. Waksal totaled $2.4 million, of which $1.0 million is recorded as accrued expense and $1.4 million is recorded as other long ‑term liabilities. The separation agreement with Dr. Samuel D. Waksal contains certain supplement conditional payments, none of which have been met at September 30, 2016 . T he Company has not recorded any expense related to these conditional payments at September 30, 2016 and will continue to evaluate the probability of these conditional payments. Separation Agreement with Dr. Samuel D. Waksal Dr. Samuel D. Waksal founded the Company in October 2010 and, until August 2014, was the chairman of the Company’s board of managers and the Company’s Chief Executive Officer. In August 2014, he stepped down as the Company’s Chief Executive Officer and became the Company’s Chief of Innovation, Science and Strategy. In July 2015, Dr. Samuel D. Waksal resigned as chairman of the Company’s board of managers. Effective as of February 8, 2016, Dr. Samuel D. Waksal resigned from all positions with the Company and is no longer employed by the Company in any capacity. The Company does not intend for Dr. Samuel D. Waksal to become an employee, provide any ongoing consulting services or rejoin the board of directors. In connection with his resignation, the Company entered into a separation agreement with Dr. Samuel D. Waksal terminating his employment with the Company and providing that he shall perform no further paid or unpaid services for the Company whether as employee, consultant, contractor or any other service provider. The principal provisions of the separation agreement are summarized below. Severance and Other Payments The Company has agreed to make a series of payments (all subject to withholding taxes) to Dr. Samuel D. Waksal, some of which are contingent, structured as follows: · a $3.0 million severance payment, of which the first $1.0 million will be payable during the first year after February 8, 2016, with the remaining $2.0 million to be payable during the two years commencing with the first anniversary of the start of payments of the first $1.0 million. Severance expense totaling $3.1 million, including the cost of Company ‑paid medical benefits, was recorded during the first quarter of 2016 as these payments are probable and estimable; · supplemental conditional payments of up to $6.75 million in the aggregate that are payable in 2017 ( $2.25 million), 2018 ( $2.25 million) and 2019 ( $2.25 million) if specified benchmarks related to the valuation of the Company implied by the public offering price in the IPO, the net proceeds to the Company from the IPO and the Company’s equity market capitalization on specified dates are achieved and subject to the Company having cash and cash equivalents less payables of $50 million or more on the dates when the Company makes those payments. These conditional payments, although estimable, are not probable at September 30, 2016 as the Company is not able to determine if or when these benchmarks related to the valuation of the Company will be achieved. The Company has not recorded any expense related to these conditional payments at September 30, 2016 and will continue to evaluate the probability of these conditional payments; · an amount equal to five percent (up to a maximum of $15 million) of any cash received by the Company or guaranteed cash payments (as defined) payable to the Company pursuant to the first three business development programs that the Company enters into on or before February 8, 2019 to research, develop, market or commercialize the Company’s ROCK2 program or the Company’s immuno ‑oncology program. For purposes of the separation agreement, ROCK2 program is defined to mean pathways involving ROCK2 or other pathways effecting autoimmunity, fibrosis, cancer or neurodegenerative diseases; immunooncology program is defined to mean antibodies or small molecules involved in inducing the immune system to make an anti ‑tumor response; and guaranteed cash payments is defined to mean payments to the Company of cash contractually provided for pursuant to an agreement entered into by the Company with respect to a business development program, which payments are not subject to the Company’s meeting any milestones or thresholds. If the aggregate cash and guaranteed cash payments received by the Company pursuant to any business development program exceed $800 million before the completion of the IPO, the equity market capitalization requirements that must be met for Dr. Samuel D. Waksal to earn the supplemental payments of up to $6.75 million described above shall be deemed fulfilled, regardless of the Company’s equity market capitalization at the applicable time. These conditional payments are not estimable or probable at September 30, 2016 as the Company is not able to determine if or when the Company will enter into these business development programs. The Company has not recorded any expense related to these conditional payments at September 30, 2016 and will continue to evaluate the probability of these conditional payments. LTIP Award With regard to the award of 5,000 EAR units granted to Dr. Samuel D. Waksal in December 2014, the separation agreement provides that: · by virtue of his separation from the Company, Dr. Samuel D. Waksal acknowledges that he is no longer entitled to vesting at December 16, 2024 based on the occurrence of an initial public offering on or before that date and continued service through that date; · the service component included in the vesting condition related to the occurrence of a change of control after an initial public offering but before December 16, 2024 is now satisfied; · the service component included in the vesting condition related to the occurrence of a 333% increase in the fair market value of each EAR unit from the $6.00 grant price per unit before December 16, 2024 is now satisfied; and · Dr. Samuel D. Waksal’s EAR units shall not be subject to forfeiture, termination or recapture payment for violation of the restrictive covenants contained in the 2014 LTIP. The liability and associated compensation expense for this award was recognized upon consummation of the Company’s IPO on August 1, 2016. No compensation expense ha d been recorded prior to this date. The Company utilized a Monte-Carlo simulation to determine the fair value of the award granted under the LTIP of $11.6 million, which was recorded during the third quarter of 2016 as this award is not forfeitable. Lock ‑up Agreement Dr. Samuel D. Waksal has agreed to enter into a 180 ‑day lock ‑up agreement in connection with the IPO. If requested by the managing underwriters in any subsequent offering at the time of which Dr. Samuel D. Waksal owns five percent or more the Company’s common stock, he will enter into a lock ‑up agreement for a period not to exceed 90 days and in the form customarily requested by the managing underwriters for that offering (subject to mutually agreed exceptions), so long as other equityholders enter into substantially similar lock ‑up agreements. If any of our equityholders that signs a lock ‑up agreement is released from its provisions by the managing underwriters, Dr. Samuel D. Waksal will also be released from his lock ‑up agreement. Covenants The separation agreement contains customary non ‑solicitation, non ‑competition and non ‑disparagement provisions that continue in effect until February 8, 2019. In addition, Dr. Samuel D. Waksal agrees to make himself available, at the Company’s expense, to assist the Company in protecting its ownership of intellectual property and in accessing his knowledge of scientific and/or research and development efforts undertaken during his employment with the Company. Releases The separation agreement provides for mutual releases by the parties and related persons of all claims arising out of Dr. Samuel D. Waksal’s relationship with the Company as employee, founder, investor, member, owner, member or Chairman of the Board, Chief Executive Officer, or officer. Financing Costs As consideration for the amendment to the Company’s 2013 convertible debt, if a qualified IPO, defined as a public offering of the Company’s equity interests with gross proceeds to the Company of at least $75.0 million, ha d not been completed on or prior to March 31, 2016, the Company agreed to pay an amendment fee equal to $1.3 million to be allocated among the lenders. This fee was accrued at December 31, 2015, and subsequently paid in April 2016 through the issuance of 108,696 Class E redeemable convertible u nits, as the Company did not complete a qualified IPO by March 31, 2016. Threatened Litigation During 2015, the Company received a demand for the issuance of additional equity under a letter agreement with Falcon Flight LLC that was entered into in November 2014. In June 2016, the Company entered into an agreement with Falcon Flight LLC and one of its affiliates in connection with a settlement of certain claims alleging breaches of a letter agreement between the Company and Falcon Flight LLC relating to a prior investment by Falcon Flight LLC and its affiliate in the Company’s securities, which letter agreement was amended and restated as part of this settlement, which the Company refers to as the Falcon Flight Agreement. Subject to certain terms and conditions contained therein, the Falcon Flight Agreement provides Falcon Flight LLC and its affiliate with certain information rights, consent rights, and anti ‑dilution protections including the issuance of 1,061,741 additional Class E redeemable convertible membership units with a conversion price equal to any down ‑round price and a right to designate a member of the Company’s board of managers or observer, among other rights . The aforementioned rights terminate d upon the closing of the IPO on August 1, 2016 , except for indemnification of Falcon Flight LLC’s board designee or observer, which survives termination. In addition, the Company agreed to provide Falcon Flight LLC with most favored nation rights which terminate d upon the closing of the IPO on August 1, 2016 and to pay $800,000 in cash to Falcon Flight LLC. The Company recorded an estimate for this settlement of approximately $10.4 million in September 2015 and record ed an additional expense of $2.6 million in June 2016 based on the excess of the fair value of this settlement over the $10.4 million previously expensed in 2015 . Royalty Arrangements The Company has contracts with third parties, which require the Company to make royalty payments based on the sales revenue of the products specified in the contract. The Company records royalty expense as the associated sales are recognized, and cl assifies such amounts as selling, general and administrative expenses in the accompanying consolidated statements of operations. Royalty payable was $3.3 million and $2.8 million at September 30, 2016 and December 31, 2015 , respectively. These royalties are generally paid quarterly. Royalty expense was $1.1 million and $2.1 million for the nine months ended September 30, 2016 and 2015 , respectively, and $0.3 million and $0.7 million for the three months ended September 30, 2016 and 2015 , respectively. Approximately $2.9 million and $2.0 million at September 30, 2016 and December 31, 2015 , respectively, of the royalty payable is the prepaid royalty that will have to be refunded to the Company’s commercial partner (Note 5 ). |
Commitments
Commitments | 9 Months Ended |
Sep. 30, 2016 | |
Commitments [Abstract] | |
Commitments | 1 3 . Commitments Lease Commitments The Company has three primary operating locations which are occupied under long ‑term leasing arrangements. In October 2010, Kadmon Corporation , LLC entered into a corporate headquarters and laboratory lease in New York, New York, expiring in February 2021 and opened a secured letter of credit with a third party financial institution in lieu of a security deposit for $2.0 million. Since inception there have been four amendments to this lease agreement, which have altered office and laboratory capacity and extended the lease term through October 2024 . Rental expense for this lease amounted to $3.5 million for each of the nine months ended September 30, 2016 and 2015 and $1.2 million for each of the three months ended September 30, 2016 and 2015 . During future years, the base rent amount a ssociated with these premises will increase 3.5% annually. The Company has the ability to extend portions of the lease on the same terms and conditions as the current lease, except that the base rent will be adjusted to the fair market rental rate for the building based on the rental rate for comparable space in the building at the time of extension. The Company is party to an operating lease in Warrendale, Pennsylvania ( the Company’s specialty-focused commercial operation ), which expires on September 30, 2019 , with a five ‑year renewal option. Rental payments under the renewal period will be at market rates dete rmined from the average rentals of similar tenants in the same industrial park. Rental expense for this lease was $429,000 and $461,000 for the nine months ended September 30, 2016 and 2015 , respectively, and $143,000 and $144,000 for the three months ended September 30, 2016 and 2015 , respectively. In August 2015, the Company entered into an office lease agreement in Cambridge, M assachusetts (the Company’s new clinical office) effective January 2016 and expiring in April 2023 . The Company opened a secured letter of credit with a third party financial institution in lieu of a security deposit for $91,000 . Rental expense for this lease was $85,000 and $257,000 for the three and nine months ended September 30, 2016 , respectively. No rent al expense was incurred for this lease during the nine months ended September 30, 2015 . Future minimum rental payments under noncancellable leases are as follows (in thousands) as of September 30, 2016 : Year ending December 31, Amount 2016 $ 1,428 2017 5,796 2018 5,912 2019 5,828 2020 5,449 Thereafter 22,020 Total $ 46,433 Licensing Commitments The Company has entered into several license agreements for products currently under development (Note 10 ). Firm payment commitments under those agreements are as follows (in thousands) as of September 30, 2016 : Year ending December 31, Amount 2016 $ — 2017 60 2018 60 2019 60 2020 60 Thereafter 60 Total $ 300 The Company may be obligated in future periods to make additional payments, which would become due and payable only upon the achievement of certain research and development, regulatory, and approval milestones. The specific timing of such milestones cannot be predicted and depends upon future discretionary clinical developments as well as regulatory agency actions which cannot be predicted with certainty (including action which may never occur). These additional contingent milestone payments aggregate to $431.4 million. Any payments made prior to FDA approval will be expensed as research and development. Payments made after FDA approval will be capitalized. Further, under the terms of certain licensing agreements, the Company may be obligated to pay commercial milestones contingent upon the realization of sales revenues and sublicense revenues. Due to the long ‑range nature of such commercial milestones, they are neither probable at this time nor predictable, and consequently are not included in the additional contingent milestone payment amount. Employment Agreements Two former employees of the Company receive d $1.25 million each upon the consummation of the IPO, which the Company settled through the issuance of an aggregate of 208,334 shares of its common stock on August 1, 2016. T he amount of compensation due to another former employee as a result of this event is contingent upon the valuation of the Company at the time of the transaction , which was not achieved upon consummation of the IPO on August 1, 2016 . Certain employment agreements also provide for routine severance compensation. The Company has recorded a liability for suc h agreements of $2.6 million, which is primarily attributable to the severance expense recognized in connection with the resignation of Dr. Samuel D. Waksal, and $0.6 million at September 30, 2016 and December 31, 2015 , respectively (Note 1 2 ). |
Contingencies
Contingencies | 9 Months Ended |
Sep. 30, 2016 | |
Contingencies [Abstract] | |
Contingencies | 1 4 . Contingencies The Company is subject to various legal proceedings that arise from time to time in the ordinary course of its business. Although the Company believes that the various proceedings brought against it are without merit, and that it has adequate product liability and other insurance to cover any claims, litigation is subject to many factors which are difficult to predict and there can be no assurance that the Company will not incur material costs in the resolution of legal matters. Should the Company determine that any future obligations will exist, the Company will record expense equal to the amount which is deemed probable and estimable. Legal Proceedings The Rosenfeld Litigation In 2014, Steven Rosenfeld commenced a lawsuit in the New York State Supreme Court, for the county of New York, against Joel Schreiber, Samuel D. Waksal and certain Kadmon entities alleging that he and co-defendant Schreiber were engaged to raise funds for a new venture involving Kadmon. Rosenfeld alleges that he was responsible for raising funds but that he was not compensated. A Third Amended Complaint was filed in or about August 2016 adding new corporate entities and adding an alleged breach of an exclusivity agreement. In October, 2016, the Company filed a motion to dismiss the action, with briefing expected to be concluded in or about January, 2017. The Company also filed a motion to stay certain discovery pending resolution of the motion to dismiss, and that motion to stay is likewise expected to be fully briefed by January 2017 . The Company believes that the claims have no merit and intends to vigorously defend this action. The Belesis Litigation In 2015, Anastasios Thomas Belesis and ATB Holding Company, LLC (together “Belesis”) filed a lawsuit in the U.S. District Court for the Southern District of New York against the Company, our subsidiaries, Samuel D. Waksal and Steven N. Gordon alleging that they are owed equity or a monetary amount for services allegedly performed. The lawsuit asserted 12 claims, ranging from federal securities fraud to breach of contract and a variety of other common law causes of action. The Company filed a motion to dismiss in September 2015 and the claims were dismissed without prejudice in September 2016. On November 8, 2016, Belesis filed a motion for leave to file a second amended complaint. The Company and named defendants are currently reviewing Belesis’ motion to file a second amended complaint and intend to continue their vigorous defense. The Glodek Litigation On July 25, 2016, Kevin Glodek filed and served a Summons with Notice against Kadmon Holdings, LLC and Kadmon Holdings, Inc., for an amount of no less than $2.8 million with interest, plus costs and disbursements. The Company’s counsel demanded a complaint and that complaint was served and filed on September 6, 2016. In the complaint, Glodek alleges fraud, misrepresentation, breach of contract, breach of the implied covenant of good faith and fair dealing, and unjust enrichment, for amounts to be determined at trial, but in no event less than $4 million with interest, plus costs and disbursements. Glodek’s claims arise out of a 2015 settlement agreement, in which he released all claims he had against Kadmon Holdings, LLC and Kadmon Holdings, Inc. On September 21, 2016, Glodek filed an Amended Summons and an Amended Complaint adding Steven N. Gordon and Mr. Poukalov as named defendants. All of the defendants believe that the settlement agreement and its broad release are binding; they deny all of the allegations and believe that they are entirely without merit; and they intend to vigorously defend themselves against this action. On October 8, 2016, the defendants filed a motion to dismiss the action, a motion for sanctions against Glodek and his counsel and a motion to disqualify Glodek’s attorneys from representing Glodek in the action. The Company expects these three motions to be fully briefed by November 15, 2016. The Company continues to believe that the settlement agreement and releases are binding and that Glodek’s current claims have no merit. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 1 5 . Related Party Transactions As of September 30, 2016 Kadmon I holds approximately 12.1% of the total outstanding common stock of Kadmon Holdings and as of December 31, 2015 Kadmon I held approximately 66% of the total outstanding Class A units of Kadmon Holdings (Note 3 ). The sole manager of Kadmon I is an executive officer of the Company. Kadmon I has no special rights or preferences in connection with its investment into Kadmon Holdings, and ha d the same rights as all other h olders of Kadmon Holdings Class A units. In October 2011, Dr. Samuel D. Waksal, a former employee of the Company, issued an equity instrument for which the underlying value is based on Class A units and is redeemable for cash upon the occurrence of a liquidity event. The liability was recorded based on fair value of the instrument on the issuance date and is subsequently marked to market using a Black ‑Scho les calculation. The total liability for this instrument was $0 and $69,000 at September 30, 2016 and December 31, 2015 , respecti vely (Note 7 ). During 2014 the Chief Executive O fficer and member, a family member of the Chief Executive O fficer and member and an executive officer provided the Company with short ‑term, interest ‑free loans to meet operating obligations. During this time the maximum amount which was outstanding in the aggregate was $3.5 million and was recorded as a related party loan on the Company’s balance sheet. The $500,000 related party loan with a family member of the Chief Executive O fficer and member was settled in January 2015 through the issuance of 43,478 Class E redeemable convertible units. As of September 30, 2016 and December 31, 2015 , the $3.0 million related party loan with the Chief Executive O fficer and director is still outstanding and is expected to be settled during the fourth quarter of 2016. In April 2015, the Company executed several agreements which transferred the Company’s ownership of KGT to MeiraGTx, a then wholly ‑owned subsidiary of the Company. The execution of all these agreements resulted in a 48% ownership in MeiraGTx by the Company, or a $24.0 million equity investment at the time of the initial transaction (Note 10 ). In July and August 2015, a family member of the Chief Executive O fficer and member provided the Company with interest ‑free loans totaling $2.0 million. The loans were repaid in full in August 2015. In June 2016, the Company entered into an agreement with 72 KDMN Investments, LLC whereby the Company agreed to extend certain rights to 72 KDMN Investments, LLC which shall survive closing of the IPO, including board of director designation rights and confidentiality rights, subject to standard exceptions. In addition, the Company agreed to provide 72 KDMN Investments, LLC with most favored nation rights which terminate d upon the closing of the IPO . |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2016 | |
Income Taxes [Abstract] | |
Income Taxes | 1 6 . Income Taxes The Company files a consolidated tax return for Kadmon Holdings, Inc. and its domestic subsidiaries and the required information returns for its international subsidiaries, all of which are wholly owned. Where permitted, the Company files combined state returns, but in some instances separate company returns for certain subsidiaries on a stand ‑alone basis are required. Deferred income taxes reflect the net effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The Company’s deferred tax assets relate primarily to its net operating loss carryforwards and other balance sheet basis differences. In accordance with ASC 740, “Income Taxes,” the Company recorded a valuation allowance to fully offset the gross deferred tax asset, because it is more likely than not that the Company will not realize future benefits associated with these deferred tax assets at September 30, 2016 and December 31, 2015 . The re was no change in deferred tax liability for the nine months ended September 30, 2016 and 2015 . F or the nine months ended September 30, 2016 , the Company recorded income tax expense of $0.3 million related to the $2.0 million milestone payment received from Jinghua. No income tax expense was recorded f or the nine months ended September 30, 2015 . |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | 17. Subsequent Events 2015 Credit Agreement On November 4, 2016, the Company executed a second amendment to the 2015 Credit Agreement whereby the Company deferred further principal payments owed under the 2015 Credit Agreement in the amount of $380,000 per month until August 31, 2017. Additionally, the parties amended various clinical development milestones and added a covenant pursuant to which the Company is required to raise $40.0 million of additional equity capital by the end of the second quarter of 2017. All other material terms of the 2015 Credit Agreement, including the maturity date, remain the same. As of the date hereof, the Company is not in default under the terms of the 2015 Credit Agreement . License Agreements On November 4, 2016, the Company notified Vivus that it will not renew its agreement with Vivus for the co ‑promotion of Qsymia ® , and therefore the agreement will terminate on December 31, 2016. No meaningful revenue has been generated from this agreement as of September 30, 2016 and December 31, 2015. |
Summary of Significant Accoun24
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Summary of Significant Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The Company operates in one segment considering the nature of the Company’s products and services, class of customers, methods used to distribute the products and the regulatory environment in which the Company operates. For the 2015 period presented , research and development expenses, and selling, general and administrative expenses were revised to conform to the current presentation with regard to the Company’s method of allocating a portion of facility-related expenses to research and development expense s to more accurately reflect the effort spent on research and development. For the three and nine months ended September 30, 2015 , the Company reclassified $1.0 million and $2.9 million, respectively , from selling, general and administrative expense s to research and development expense s . |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The consolidated financial statements include the accounts of Kadmon Holdings, Inc. and its domestic and international subsidiaries, all of which are wholly owned. |
Interim Financial Statements | Interim Financial Statements The accompanying financial statements have been prepared in accordance with GAAP for interim financial information and with the instructions to F orm 10 - Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In our opinion the financial statements include all adjustments (consisting of normal recurring accruals) necessary in order to make the financial statements not misleading. Operating results for the three and nine months ended September 30, 2016 are not necessarily indicative of the final results that may be expected for the year ended December 31, 2016. These unaudited financial statements should be read in conjunction with the audited financial statements for the year ended December 31, 2015 included in the Company’s final prospectus filed pursuant to Rule 424(b) under the Securities Act of 1933, as amended (the “Securities Act”) with the Securities and Exchange Commission (the “SEC”) on July 27, 2016 (the “Final Prospectus”) . |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements. Actual results could differ from those estimates. |
Critical Accounting Policies | Critical accounting policies The Company’s significant accounting policies are disclosed in the audited financial statements as of and for the year ended December 31, 2015 included in the Final Prospectus . Since the date of such financial statements, there have been no changes to the Company’s significant accounting policies, other than those described below. |
Inventories | Inventories Inventories are stated at the lower of cost or market (on a first ‑in, first ‑out basis) using standard costs. Standard costs include an allocation of overhead rates, which include those costs attributable to managing the supply chain and are evaluated regularly. Variances are expensed as incurred. |
Deferred Offering Costs | Deferred Offering Costs Deferred offering costs, which consisted primarily of direct costs related to the IPO, were being capitalized in other current assets until the consummation of the IPO. These offering costs were reclassified to additional paid ‑in capital upon the closing of the IPO, which occurred on August 1, 2016. There were no deferred offering costs capitalized as of September 30, 2016 and $0.9 million of deferred offering costs capitalized as of December 31, 2015 . |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In March 2016, the FASB issued Accounting Standards Update (“ASU”) No. 2016 ‑09, “ Compensation—Stock Compensation ”. This ASU simplifies several aspects of the accounting for share ‑based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. This guidance is effective for annual and interim reporting periods of public entities beginning after December 15, 2016, with early adoption permitted. The Company is currently evaluating the impact of adopting the standard on its consolidated financial statements. In March 2016, the FASB issued ASU No. 2016 ‑08, “ Revenue from Contracts with Customers ” (“ASU 2016 ‑08”). This ASU amends the existing accounting guidance for principal versus agent considerations when recognizing revenue from contracts with customers. This guidance is effective for annual and interim reporting periods of public entities beginning after December 15, 2017, with early adoption permitted. In May 2014, the FASB issued ASU No. 2014 ‑09, “Revenue from Contracts with Customers .” Under this guidance, an entity is required to recognize revenue upon transfer of promised goods or services to customers, in an amount that reflects the expected consideration received in exchange for those goods or services. As such, an entity will need to use more judgment and make more estimates than under the current guidance. The Company is currently evaluating the appropriate transition method and any impact of this guidance on its consolidated financial statements and related disclosures. In March 2016, the FASB issued ASU No. 2016 ‑06, “ Derivatives and Hedging ” (“ASU 2016 ‑06”). This ASU clarifies the requirements for assessing whether contingent call (put) options that can accelerate the payment of principal on debt instruments are clearly and closely related to their debt hosts. This guidance is effective for annual and interim reporting periods of public entities beginning after December 15, 2016, with early adoption permitted. An entity should apply the amendments in this ASU on a modified retrospective basis to existing debt instruments as of the beginning of the fiscal year for which the amendments are effective. The Company is currently evaluating the impact of adopting the standard on its consolidated financial statements. In February 2016, the FASB issued ASU No. 2016 ‑02, “ Leases ” (“ASU 2016 ‑02”). This ASU amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets. This guidance is effective for annual and interim reporting periods of public entities beginning after December 15, 2018, with early adoption permitted. The Company is currently evaluating the impact of adopting the standard on its consolidated financial statements. In November 2015, the FASB issued ASU No. 2015 ‑17, “ Income Taxes (Topic 740) ” (“ASU 2015-17”) which simplifies the presentation of deferred income taxes. It requires that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. This standard is effective for annual reporting periods beginning after December 15, 2016 with early adoption permitted as of the beginning of an interim or annual reporting period. The new guidance may be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. The Company adopted ASU 2015 ‑17 in fiscal year 2015 and applied the guidance retrospectively to all periods presented. The adoption of ASU 2015 ‑17 did not have a significant impact on the Company’s consolidated financial statements or related disclosures. In August 2015, the FASB issued ASU No. 2015 ‑15, “ Interest—imputation of interest (Subtopic 835 ‑30)” (“ASU 2015-15”) which updated the accounting guidance related to the balance sheet presentation of debt issuance costs specific to line of credit arrangements. The updated accounting guidance allows the option of presenting deferred debt issuance costs related to line ‑of ‑credit arrangements as an asset, and subsequently amortizing over the term of the line ‑of ‑credit arrangement, regardless of whether there are any outstanding borrowings. The Company adopted ASU No. 2015 ‑15 in fiscal year 2015, which had no impact on its consolidated financial statements or related disclosures. In July 2015, the FASB issued ASU No. 2015 ‑11, “ Inventory (Topic 330) ” which simplifies the subsequent measurement of inventory. It replaces the current lower of cost or market test with a lower of cost or net realizable value test. The standard is effective for public entities for annual reporting periods beginning after December 15, 2016, and interim periods therein. Early adoption is permitted. The new guidance must be applied prospectively. The Company does not expect the standard to impact its consolidated financial statements. In April 2015, the FASB issued ASU No. 2015 ‑03 , “Interest—Imputation of Interest (Subtopic 835 ‑30) . ” This standard amends existing guidance to require the presentation of debt issuance costs in the balance sheet as a deduction from the carrying amount of the related debt liability instead of a deferred charge. It is effective for annual reporting periods beginning after December 15, 2015, but early adoption is permitted. The Company adopted this standard on its consolidated financial statements during 2015 and retroactively adjusted the prior year’s presentations to conform to the current presentation. These reclassifications had no effect on previously reported net income. In August 2014, the FASB issued ASU No. 2014 ‑15, “Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” (“ASU 2014-15”) to provide guidance on management’s responsibility in evaluating whether there is substantial doubt about a company’s ability to continue as a going concern and to provide related footnote disclosures. The Company adopted ASU 2014 ‑15 in fiscal year 2016 which did not have a significant impact on its consolidated financial statements or related disclosures. |
Net Loss per Share Attributab25
Net Loss per Share Attributable to Common Stockholders (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Net Loss per Share Attributable to Common Stockholders [Abstract] | |
Computation of Basic and Diluted Net Loss per Share Attributable to Common Stockholders | Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Numerator – basic and diluted: Net loss attributable to common stockholders $ (138,232) $ (82,079) $ (207,788) $ (112,612) Denominator – basic and diluted: Weighted average common stock outstanding used to compute basic and diluted net loss per share 32,678,259 8,255,011 16,487,715 8,070,165 Net loss per share, basic and diluted $ (4.23) $ (9.94) $ (12.60) $ (13.95) |
Anti-dilutive Amounts Excluded From Calculation of Diluted Net Loss per Share | Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Convertible preferred stock $ 3,159,688 $ 3,159,688 $ 3,159,688 $ 3,159,688 Options to purchase common stock 3,245,743 579,304 3,245,743 579,304 Warrants to purchase common stock 1,328,452 1,328,452 1,328,452 1,328,452 Total shares of common stock equivalents $ 7,733,883 $ 5,067,444 $ 7,733,883 $ 5,067,444 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Debt [Abstract] | |
Debt Payable | September 30, December 31, 2016 2015 Senior convertible term loan due June 17, 2018 (A) $ — $ 58,500 Secured term debt due June 17, 2018 (B) 34,620 35,000 Second-lien convertible debt due August 28, 2019 (C) — 114,760 Total debt before fees, interest and debt discount 34,620 208,260 Paid-in-kind interest — 18,726 Less: Deferred financing costs (865) (5,861) Debt discount (3,876) (9,504) Total debt payable $ 29,879 $ 211,621 Debt payable, current portion $ 4,940 $ 1,900 Debt payable, long-term $ 24,939 $ 209,721 |
Minimum Payments Required on Outstanding Balances | 2015 Credit Agreement 2016 $ 1,520 2017 4,560 2018 28,540 $ 34,620 |
Interest Expense and Other Related Financing Costs | Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Interest expense and other financing costs $ 1,009 $ 2,039 $ 2,862 $ 7,090 Interest expense - beneficial conversion feature 45,915 — 45,915 — Interest paid-in kind 2,347 2,899 14,695 6,202 Write-off of deferred financing costs and debt discount 3,820 2,752 3,820 2,752 Amortization of deferred financing costs and debt discount 932 1,266 3,724 3,752 Interest expense $ 54,023 $ 8,956 $ 71,016 $ 19,796 |
Financial Instruments (Tables)
Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Fair Values of Financial Instruments | Fair Value Measurement Using: December 31, Significant Other Observable Inputs Significant Unobservable Inputs Description 2015 (Level 2) (Level 3) Warrants $ 8,220 $ — $ 8,220 Success Fee 69 — 69 Total $ 8,289 $ — $ 8,289 September 30, Significant Other Observable Inputs Significant Unobservable Inputs Description 2016 (Level 2) (Level 3) Warrants $ 4,534 $ 4,534 $ — Total $ 4,534 $ 4,534 $ — |
Rollforward of Level 3 Investments | Significant Other Observable Inputs Significant Unobservable Inputs (Level 2) (Level 3) Balance as of January 1, 2015 $ — $ 3,483 Change in fair value of financial instruments — (1,494) Fair value of warrants issued in connection with 2015 credit agreement — 6,300 Balance as of December 31, 2015 $ — $ 8,289 Transfer of warrants from Level 3 to Level 2 6,300 (6,300) Change in fair value of financial instruments (2,878) (273) Beneficial conversion feature recognized on warrants issued in connection with 2015 credit agreement 1,112 — Reclassification of warrants to APIC in connection with IPO — (1,716) Balance as of September 30, 2016 $ 4,534 $ — |
Success Fee [Member] | |
Fair Value Assumptions | December 31, Input 2015 Unit price $5.00 Strike price $11.41 Volatility 79.20% Risk-free interest rate 0.49% Expected life .50 Years Expected dividend yield 0% |
Equity Issued from Credit Agreement [Member] | |
Fair Value Assumptions | December 31, Input 2015 Unit price $5.00 Strike price $9.50 Volatility 79.18% Risk-free interest rate 0.49% Expected life .50 Years Expected dividend yield 0% |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Inventories [Abstract] | |
Schedule of Inventories | September 30, December 31, 2016 2015 Raw materials $ 1,298 $ 1,905 Finished goods, net 982 1,563 Total inventories $ 2,280 $ 3,468 |
Goodwill and Other Intangible29
Goodwill and Other Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Goodwill and Other Intangible Assets [Abstract] | |
Carrying Amount of Goodwill and Other Amortizable Intangible Assets | Balance as of December 31, 2014 Amortization Impairment Balance as of December 31, 2015 Remaining Useful Life as of December 31, 2015 Ribasphere product rights $ 73,934 $ (27,442) $ (31,269) $ 15,223 1.0 Goodwill $ 3,580 $ — $ — $ 3,580 — Balance as of December 31, 2015 Amortization Impairment Balance as of September 30, 2016 Remaining Useful Life as of September 30, 2016 Ribasphere product rights $ 15,223 $ (12,470) $ — $ 2,753 0.25 Goodwill $ 3,580 $ — $ — $ 3,580 — |
License Agreements (Tables)
License Agreements (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
License Agreements [Abstract] | |
Summarized Financial Information for MeiraGTx | Balance Sheet Data: Cash $ 14,548 Other current assets 433 Noncurrent assets 42 Current liabilities 4,621 Noncurrent liabilities 17 Total stockholders’ equity 9,249 Statement of Operations Data: General and administrative expense $ 4,184 Research and development expense 9,876 Net loss attributable to non ‑ controlling interest in subsidiary 829 Net loss and comprehensive loss (13,154) |
Share-based Compensation (Table
Share-based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Share-based Compensation [Abstract] | |
Unit Options Outstanding | Options Outstanding Options Exercisable Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value (in thousands) Number of Options Weighted Average Exercise Price Balance, December 31, 2014 706,460 $ 52.15 8.63 $ — 266,518 $ 50.50 Granted 1,154,394 37.44 Exercised (772) 38.70 Forfeited (174,834) 57.68 Balance, December 31, 2015 1,685,248 $ 37.38 8.72 $ — 381,072 $ 36.29 Granted 1,630,536 12.00 Exercised (1,109) 36.63 Forfeited (68,932) 35.46 Balance, September 30, 2016 3,245,743 $ 12.00 8.90 $ — 2,022,936 $ 12.00 |
Weighted-average Fair Value of Stock Option Awards Granted | Nine Months Ended Year Ended September 30, 2016 December 31, 2015 Weighted average fair value of grants $7.60 $20.67 Expected volatility 79.35% 77.23% - 93.85% Risk-free interest rate 1.15% 1.54% - 1.93% Expected life 5.0 years 5.2 - 6.0 years Expected dividend yield 0% 0% |
Warrants Outstanding | Warrants Weighted Average Exercise Price Balance, December 31, 2015 710,801 $ 46.64 Granted 617,651 10.20 Exercised — — Forfeited — — Balance, September 30, 2016 1,328,452 $ 29.70 |
Accrued Expenses and Other Sh32
Accrued Expenses and Other Short Term Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Accrued Expenses and Other Short Term Liabilities [Abstract] | |
Short-term Accrued Expenses | September 30, December 31, 2016 2015 Commission payable $ 2,695 $ 2,820 Accrued bonus 393 362 Severance 1,555 578 Other compensation and benefits 778 956 Financing/Offering Costs — 1,250 Threatened litigation — 10,377 Royalty arrangements 3,309 2,777 Other 3,707 3,100 Total Accrued Expenses $ 12,437 $ 22,220 |
Commitments (Tables)
Commitments (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Commitments [Abstract] | |
Future Minimum Rental Payments Under Noncancellable Leases | Year ending December 31, Amount 2016 $ 1,428 2017 5,796 2018 5,912 2019 5,828 2020 5,449 Thereafter 22,020 Total $ 46,433 |
Firm Payment Commitments Under License Agreements | Year ending December 31, Amount 2016 $ — 2017 60 2018 60 2019 60 2020 60 Thereafter 60 Total $ 300 |
Organization and Basis of Pre34
Organization and Basis of Presentation (Details) - USD ($) $ / shares in Units, $ in Thousands | Nov. 04, 2016 | Aug. 01, 2016 | Nov. 30, 2015 | Oct. 31, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Jul. 26, 2016 | Jun. 08, 2016 |
Common stock issued in initial public offering, net of commissions and underwriting discounts, shares | 6,250,000 | |||||||||
Stock issued, price per share | $ 12 | |||||||||
Proceeds from IPO, net | $ 66,000 | $ 69,750 | ||||||||
Offering expenses | 3,700 | $ 2,551 | $ 3,100 | |||||||
Underwriting discounts and commissions | $ 5,300 | |||||||||
Shares outstanding | 45,078,666 | 45,078,666 | 0 | |||||||
Common stock, shares authorized | 200,000,000 | 0 | 200,000,000 | |||||||
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |||||||
Accumulated deficit | $ (131,015) | $ (643,845) | ||||||||
Working capital deficit | 26,100 | |||||||||
Proceeds from issuance of redeemable convertible units | 5,500 | $ 558 | ||||||||
Cash and cash equivalents | $ 55,001 | $ 7,702 | $ 21,498 | $ 20,991 | ||||||
Class A Units [Member] | ||||||||||
Common stock issued in initial public offering, net of commissions and underwriting discounts, shares | 1,250,000 | |||||||||
Class E Redeemable Convertible Units [Member] | ||||||||||
Common stock issued in initial public offering, net of commissions and underwriting discounts, shares | 478,266 | 945,441 | 3,438,984 | |||||||
Offering expenses | $ 40 | |||||||||
Proceeds from issuance of redeemable convertible units | $ 10,900 | |||||||||
Convertible Preferred Stock [Member] | ||||||||||
Preferred stock, shares authorized | 10,000,000 | 0 | 10,000,000 | 10,000,000 | ||||||
Preferred stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |||||||
License Agreement, Jinghua [Member] | ||||||||||
Milestone payment | $ 2,000 | |||||||||
Proceeds from issuance of redeemable convertible units | $ 10,000 | |||||||||
License Agreement, Jinghua [Member] | Class E Redeemable Convertible Units [Member] | ||||||||||
Proceeds from issuance of redeemable convertible units | $ 10,000 | |||||||||
2015 Second-Lien Convertible Debt [Member] | ||||||||||
Shares converted | 19,034,467 | |||||||||
2015 Credit Agreement [Member] | Subsequent Event [Member] | ||||||||||
Deferred Principal Payments | $ 380 | |||||||||
Additional equity capital to be raised | $ 40,000 |
Summary of Significant Accoun35
Summary of Significant Accounting Policies (Narrative) (Details) | Aug. 01, 2016shares | Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2016USD ($)segment | Sep. 30, 2015USD ($) | Dec. 31, 2015USD ($) |
Summary Of Significant Accounting Policies [Line Items] | ||||||
Number of operating segments | segment | 1 | |||||
Reclassified from selling, general and administrative expense to research and development expense | $ 1,000,000 | $ 2,900,000 | ||||
Research and development expense | $ 9,550,000 | $ 8,439,000 | $ 27,134,000 | 23,344,000 | ||
Deferred offering costs capitalized | $ 890,000 | |||||
Impairment of intangible assets | 31,269,000 | |||||
Impairment to goodwill | ||||||
Capitalized lease obligations | $ 230,000 | $ 20,000 | ||||
Options [Member] | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Dividend yield | 0.00% | 0.00% | ||||
New York [Member] | Secured Letter of Credit [Member] | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Secured letter of credit | 2,000,000 | $ 2,000,000 | ||||
Massachusetts [Member] | Secured Letter of Credit [Member] | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Secured letter of credit | $ 91,000 | $ 91,000 | ||||
2015 Second-Lien Convertible Debt [Member] | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Shares converted | shares | 19,034,467 |
Members' Capital (Details)
Members' Capital (Details) - USD ($) | Aug. 01, 2016 | Jun. 08, 2016 | Nov. 30, 2015 | Oct. 31, 2015 | Apr. 30, 2015 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Jul. 26, 2016 | Jan. 31, 2015 | Oct. 31, 2014 |
Proceeds from issuance of redeemable convertible units | $ 5,500,000 | $ 558,000 | |||||||||||
Stock issuance costs | $ 3,700,000 | 2,551,000 | $ 3,100,000 | ||||||||||
Stock issued, shares | 6,250,000 | ||||||||||||
Prepaid expenses | $ 930,000 | $ 3,490,000 | |||||||||||
Issuance of units related to option exercises, shares | 1,109 | 772 | |||||||||||
Beneficial conversion feature on convertible preferred stock | $ 7,567,000 | ||||||||||||
Accrued dividends on preferred stock | $ 266,000 | ||||||||||||
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | ||||||||||
Common stock, shares authorized | 200,000,000 | 0 | 200,000,000 | ||||||||||
Price per share of common stock at IPO date | $ 12 | ||||||||||||
Underwriting discounts and commissions | $ 5,300,000 | ||||||||||||
Offering expenses | 3,700,000 | $ 2,551,000 | $ 3,100,000 | ||||||||||
Proceeds from IPO, net | $ 66,000,000 | $ 69,750,000 | |||||||||||
Common stock issued in initial public offering, net of commissions and underwriting discounts, shares | 6,250,000 | ||||||||||||
Shares outstanding | 45,078,666 | 45,078,666 | 0 | ||||||||||
Shares issued from conversion | 19,034,467 | ||||||||||||
Third Party Investors [Member] | |||||||||||||
Stock issuance costs | $ 40,000 | ||||||||||||
Offering expenses | $ 40,000 | ||||||||||||
Kadmon I, LLC [Member] | Investment Funds [Member] | |||||||||||||
Ownership percentage | 80.00% | ||||||||||||
Ownership percentage after distribution | 50.00% | ||||||||||||
Kadmon I, LLC [Member] | Certain Parties [Member] | |||||||||||||
Ownership percentage | 20.00% | ||||||||||||
Ownership percentage after distribution | 50.00% | ||||||||||||
Class A Units [Member] | |||||||||||||
Common units issued | 0 | 53,946,001 | |||||||||||
Common units outstanding | 0 | 53,946,001 | |||||||||||
Stock issued, shares | 1,250,000 | ||||||||||||
Shares issued for advisory agreement | 1,500,000 | 25,000 | |||||||||||
Advisory agreement expense | $ 2,300,000 | $ 3,000,000 | $ 3,800,000 | ||||||||||
Prepaid expenses | $ 9,000,000 | ||||||||||||
Issuance of units related to option exercises, shares | 7,200 | 5,011 | |||||||||||
Shares issued for settlements | 25,000 | 308,334 | |||||||||||
Third party obligations settlement expense | $ 100,000 | $ 1,500,000 | |||||||||||
Unit price | $ 32.50 | $ 32.50 | $ 39 | ||||||||||
Common stock issued in initial public offering, net of commissions and underwriting discounts, shares | 1,250,000 | ||||||||||||
Shares issued from conversion | (53,978,201) | ||||||||||||
Class B Units [Member] | |||||||||||||
Common units issued | 0 | 1 | |||||||||||
Common units outstanding | 0 | 1 | |||||||||||
Shares issued from conversion | (1) | ||||||||||||
Class C Units[Member] | |||||||||||||
Common units issued | 0 | 1 | |||||||||||
Common units outstanding | 0 | 1 | |||||||||||
Shares issued from conversion | (1) | ||||||||||||
Class D Units [Member] | |||||||||||||
Common units issued | 0 | 4,373,674 | |||||||||||
Common units outstanding | 0 | 4,373,674 | |||||||||||
Shares issued from conversion | (4,373,674) | ||||||||||||
Class D Units [Member] | Conversion Event Threshold Three [Member] | |||||||||||||
Proceeds from conversion event | $ 4,200,000 | ||||||||||||
Class E Redeemable Convertible Units [Member] | |||||||||||||
Common units outstanding | 4,969,252 | ||||||||||||
Proceeds from issuance of redeemable convertible units | $ 10,900,000 | ||||||||||||
Proceeds from issuance of redeemable convertible units net of transaction costs | 10,800,000 | ||||||||||||
Stock issuance costs | $ 40,000 | ||||||||||||
Stock issued, shares | 478,266 | 945,441 | 3,438,984 | ||||||||||
Shares issued for advisory agreement | 1,170,437 | ||||||||||||
Shares issued for settlements | 574,392 | ||||||||||||
Shares issued for settlements, value | $ 6,600,000 | ||||||||||||
Third party obligations settlement expense | $ 6,100,000 | $ 500,000 | |||||||||||
Preferred stock issued | 43,478 | ||||||||||||
Redemption value | $ 85,000,000 | ||||||||||||
Liquidation preference | 125.00% | ||||||||||||
Liquidation preference rate increase | 1.00% | ||||||||||||
Class E redeemable convertible units outstanding | 0 | 4,969,252 | |||||||||||
Offering expenses | $ 40,000 | ||||||||||||
Common stock issued in initial public offering, net of commissions and underwriting discounts, shares | 478,266 | 945,441 | 3,438,984 | ||||||||||
Shares issued from conversion | (6,617,955) | ||||||||||||
Class E Redeemable Convertible Units [Member] | Chief Executive Officer [Member] | |||||||||||||
Stock issued, shares | 86,957 | ||||||||||||
Common stock issued in initial public offering, net of commissions and underwriting discounts, shares | 86,957 | ||||||||||||
Class E Redeemable Convertible Units [Member] | Board of Directors Chairman [Member] | |||||||||||||
Stock issued, shares | 21,740 | ||||||||||||
Common stock issued in initial public offering, net of commissions and underwriting discounts, shares | 21,740 | ||||||||||||
Class E Redeemable Convertible Units [Member] | Directors [Member] | |||||||||||||
Stock issued, shares | 21,740 | ||||||||||||
Common stock issued in initial public offering, net of commissions and underwriting discounts, shares | 21,740 | ||||||||||||
Class E Redeemable Convertible Units [Member] | Third Party Investors [Member] | |||||||||||||
Proceeds from issuance of redeemable convertible units | $ 900,000 | ||||||||||||
Stock issued, shares | 75,875 | ||||||||||||
Common stock issued in initial public offering, net of commissions and underwriting discounts, shares | 75,875 | ||||||||||||
Class E Redeemable Convertible Units [Member] | GoldenTree Asset Management LP [Member] | |||||||||||||
Stock issued, shares | 43,479 | ||||||||||||
Common stock issued in initial public offering, net of commissions and underwriting discounts, shares | 43,479 | ||||||||||||
Convertible Preferred Stock [Member] | |||||||||||||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | 0 | 10,000,000 | |||||||||
Preferred stock issued | 30,000 | 30,000 | 0 | ||||||||||
Preferred stock outstanding | 30,000 | 0 | |||||||||||
Issuance per share | $ 1,000 | ||||||||||||
Liquidation preference | $ 30,000,000 | ||||||||||||
Beneficial conversion feature, discount percentage | 20.00% | ||||||||||||
Series B And C Preferred Stock [Member] | Conversion Event Threshold Three [Member] | |||||||||||||
Proceeds from conversion event | $ 41,700,000 | ||||||||||||
License Agreement, Jinghua [Member] | |||||||||||||
Proceeds from issuance of redeemable convertible units | $ 10,000,000 | ||||||||||||
License Agreement, Jinghua [Member] | Class E Redeemable Convertible Units [Member] | |||||||||||||
Proceeds from issuance of redeemable convertible units | $ 10,000,000 | ||||||||||||
Minimum [Member] | Conversion Event Threshold Three [Member] | |||||||||||||
Company valuation | $ 45,800,000 | ||||||||||||
Minimum [Member] | Class E Redeemable Convertible Units [Member] | |||||||||||||
Percent of value for conversion | 80.00% | ||||||||||||
Qualified IPO threshold | $ 75,000,000 | ||||||||||||
Liquidation preference | 5.00% | ||||||||||||
Maximum [Member] | Class E Redeemable Convertible Units [Member] | |||||||||||||
Liquidation preference | 10.00% | ||||||||||||
Pre-IPO [Member] | Class E Redeemable Convertible Units [Member] | |||||||||||||
Conversion price | $ 11.50 | ||||||||||||
Post-IPO [Member] | Class A Units [Member] | |||||||||||||
Percent of value for conversion | 85.00% | ||||||||||||
Post-IPO [Member] | Class E Redeemable Convertible Units [Member] | |||||||||||||
Conversion price | $ 11.50 | ||||||||||||
2015 Second-Lien Convertible Debt [Member] | |||||||||||||
Borrowings, face amount | $ 92,000,000 | $ 92,000,000 | $ 15,000,000 | ||||||||||
2015 Second-Lien Convertible Debt [Member] | Class A Units [Member] | |||||||||||||
Shares issued for advisory agreement | 25,000 |
Net Loss per Share Attributab37
Net Loss per Share Attributable to Common Stockholders (Computation of Basic and Diluted Net Loss per Share Attributable to Common Stockholders) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Net Loss per Share Attributable to Common Stockholders [Abstract] | ||||
Net loss attributable to common stockholders | $ (138,232) | $ (82,079) | $ (207,788) | $ (112,612) |
Weighted average common stock outstanding used to compute basic and diluted net loss per share | 32,678,259 | 8,255,011 | 16,487,715 | 8,070,165 |
Net loss per share, basic and diluted | $ (4.23) | $ (9.94) | $ (12.60) | $ (13.95) |
Net Loss per Share Attributab38
Net Loss per Share Attributable to Common Stockholders (Anti-dilutive Amounts Excluded From Calculation of Diluted Net Loss per Share) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Net Loss per Share Attributable to Common Stockholders [Abstract] | ||||
Convertible preferred stock | $ 3,159,688 | $ 3,159,688 | $ 3,159,688 | $ 3,159,688 |
Options to purchase common stock | 3,245,743 | 579,304 | 3,245,743 | 579,304 |
Warrants to purchase common stock | 1,328,452 | 1,328,452 | 1,328,452 | 1,328,452 |
Total shares of common stock equivalents | $ 7,733,883 | $ 5,067,444 | $ 7,733,883 | $ 5,067,444 |
Commercial Partnership (Details
Commercial Partnership (Details) - USD ($) $ in Thousands | Jun. 17, 2013 | Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | Oct. 31, 2014 |
License revenue | $ 1,350 | $ 1,482 | $ 6,274 | $ 4,205 | |||
Deferred revenue, short term | 4,424 | 4,424 | $ 4,500 | ||||
Deferred revenue, long term | 25,117 | 25,117 | 28,417 | ||||
Accrued expenses | 12,437 | 12,437 | 11,843 | ||||
Other long term liability | 1,511 | $ 1,511 | 3,152 | ||||
AbbVie, Inc. [Member] | |||||||
Upfront Payment | $ 64,000 | ||||||
Contingent milestone payments | 51,000 | ||||||
License agreement, term | 10 years | ||||||
License revenue | 1,100 | $ 1,100 | $ 3,300 | $ 3,300 | |||
Deferred revenue | $ 44,000 | 29,500 | 29,500 | 32,800 | $ 6,000 | ||
Deferred revenue, short term | 4,400 | 4,400 | 3,000 | 3,000 | |||
Deferred revenue, long term | $ 3,000 | ||||||
Accrued expenses | $ 2,100 | $ 2,100 | |||||
Other long term liability | $ 2,900 |
Debt (Senior Convertible Term L
Debt (Senior Convertible Term Loan) (Narrative) (Details) - USD ($) | Aug. 01, 2016 | Aug. 31, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Jun. 30, 2016 | Apr. 30, 2016 | Dec. 31, 2015 |
Debt Instrument [Line Items] | |||||||||
Deferred financing costs | $ 865,000 | $ 865,000 | $ 5,861,000 | ||||||
Debt discount | 3,876,000 | 3,876,000 | $ 9,504,000 | ||||||
Loss on extingushment of debt | (11,176,000) | $ (2,934,000) | (11,176,000) | $ (2,934,000) | |||||
Minimum amount of gross proceeds from IPO | $ 66,000,000 | $ 69,750,000 | |||||||
Actual [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Percentage of IPO price per share | 20.00% | ||||||||
Convertible Preferred Stock [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Conversion of convertible debt | $ 30,000,000 | ||||||||
Common Stock [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Conversion of convertible debt | 176,615,000 | ||||||||
Senior Convertible Term Loan and Second Lien Convert [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Shares converted | 19,034,467 | ||||||||
Convertible Debt [Member] | Term Loan Maturing on June 17, 2018 [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Total borrowings | $ 69,100,000 | ||||||||
Maturity date | Jun. 17, 2018 | ||||||||
Convertible Debt [Member] | Third Amended and Restated Convertible Credit Agreement [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Fees | $ 1,300,000 | ||||||||
Debt discount | 1,300,000 | 1,300,000 | |||||||
Minimum amount of gross proceeds from IPO | 75,000,000 | ||||||||
Convertible Debt [Member] | Senior Convertible Term Loan [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Total borrowings | $ 75,000,000 | ||||||||
Fees | 20,700,000 | 20,700,000 | |||||||
Make-whole fee | $ 8,000,000 | 8,000,000 | |||||||
Convertible Debt [Member] | Senior Convertible Term Loan [Member] | Consideration One [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Aggregate principal amount | $ 30,000,000 | ||||||||
Shares exchange | 30,000 | ||||||||
Convertible Debt [Member] | Senior Convertible Term Loan [Member] | Consideration Two [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Aggregate principal amount | $ 25,000,000 | ||||||||
Percentage of principal converted | 100.00% | ||||||||
Percentage of IPO price per share | 80.00% | ||||||||
Convertible Debt [Member] | Senior Convertible Term Loan [Member] | Consideration Three [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Aggregate principal amount | $ 20,000,000 | ||||||||
Percentage of IPO price per share | 125.00% |
Debt (Secured Term Debt) (Narra
Debt (Secured Term Debt) (Narrative) (Details) | Nov. 04, 2016USD ($) | Aug. 31, 2015USD ($)item | Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) | Jun. 30, 2016USD ($) | Dec. 31, 2015USD ($) |
Debt Instrument [Line Items] | ||||||||
Debt discount | $ 3,876,000 | $ 3,876,000 | $ 9,504,000 | |||||
Loss on extingushment of debt | (11,176,000) | $ (2,934,000) | (11,176,000) | $ (2,934,000) | ||||
Deferred financing costs | 865,000 | 865,000 | 5,861,000 | |||||
Convertible Debt [Member] | Second-Lien Amendment [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Fees | $ 32,400,000 | |||||||
Secured Debt [Member] | 2015 Credit Agreement [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Total borrowings | $ 35,000,000 | |||||||
Fees | $ 788,000 | |||||||
Monthly principal payments | $ 380,000 | |||||||
Maturity date | Jun. 17, 2018 | |||||||
Number of lenders | item | 2 | |||||||
Debt discount | 1,500,000 | $ 1,500,000 | ||||||
Deferred financing cost write-offs | 390,000 | |||||||
Deferred financing costs | 1,300,000 | 1,300,000 | ||||||
Unamortized deferred financing costs | 900,000 | $ 900,000 | $ 1,100,000 | |||||
Debt term | 3 years | |||||||
Interest expense | 100,000 | $ 100,000 | $ 400,000 | $ 100,000 | ||||
Secured Debt [Member] | 2015 Credit Agreement [Member] | Class A Warrants [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Warrants to purchase | $ 6,300,000 | 6,300,000 | ||||||
Debt discount | 5,400,000 | $ 5,400,000 | 5,400,000 | |||||
Loss on extingushment of debt | $ 900,000 | 900,000 | ||||||
Secured Debt [Member] | 2015 Credit Agreement [Member] | One Exsisting Lender [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Loss on extingushment of debt | $ 113,000 | |||||||
Secured Debt [Member] | London Interbank Offered Rate (LIBOR) [Member] | 2015 Credit Agreement [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument spread | 9.375% | |||||||
Secured Debt [Member] | London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member] | 2015 Credit Agreement [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument spread | 1.00% | |||||||
Subsequent Event [Member] | 2015 Credit Agreement [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Deferred principal payments | $ 380,000 | |||||||
Additional equity capital to be raised | $ 40,000,000 |
Debt (Second-Lein Convertible D
Debt (Second-Lein Convertible Debt) (Narrative) (Details) | Aug. 01, 2016USD ($) | Jun. 30, 2016USD ($) | Nov. 30, 2015USD ($) | Oct. 31, 2015USD ($) | Aug. 31, 2015USD ($)item | Sep. 30, 2016USD ($)$ / shares | Sep. 30, 2015USD ($) | Sep. 30, 2016USD ($)item$ / shares | Sep. 30, 2015USD ($) | Dec. 31, 2015USD ($) |
Debt Instrument [Line Items] | ||||||||||
Minimum amount of gross proceeds from IPO | $ 66,000,000 | $ 69,750,000 | ||||||||
Deferred financing costs | $ 865,000 | 865,000 | $ 5,861,000 | |||||||
Debt discount | 3,876,000 | $ 3,876,000 | 9,504,000 | |||||||
2015 Second-Lien Convertible Debt [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Total borrowings | $ 92,000,000 | $ 92,000,000 | 15,000,000 | |||||||
Fees | 600,000 | |||||||||
Convertible Debt [Member] | 2015 Second-Lien Convertible Debt [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Number of lenders | item | 2 | |||||||||
Debt term | 4 years | |||||||||
Total borrowings | $ 94,300,000 | 114,800,000 | $ 114,800,000 | |||||||
Fees | $ 2,300,000 | $ 2,300,000 | $ 2,300,000 | |||||||
Increase to total borrowings | $ 15,000,000 | $ 5,500,000 | ||||||||
Interest rate | 13.00% | 13.00% | ||||||||
Percentage of IPO price per share | 90.00% | |||||||||
Deferred financing costs | $ 4,200,000 | $ 4,200,000 | ||||||||
Unamortized deferred financing costs | 0 | 0 | $ 3,900,000 | |||||||
Interest expense | $ 100,000 | $ 100,000 | $ 700,000 | $ 100,000 | ||||||
Convertible Debt [Member] | 2015 Second-Lien Convertible Debt [Member] | Debt Instrument, Redemption, Period One [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Redemption price percentage | 150.00% | |||||||||
Convertible Debt [Member] | 2015 Second-Lien Convertible Debt [Member] | Debt Instrument, Redemption, Period Two [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Redemption price percentage | 110.00% | |||||||||
Convertible Debt [Member] | 2015 Second-Lien Convertible Debt [Member] | Pre-IPO [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Interest rate | 21.00% | 21.00% | ||||||||
Minimum amount of gross proceeds from IPO | $ 50,000,000 | |||||||||
Increase to interest rate | 3.00% | |||||||||
Convertible Debt [Member] | Second-Lien Amendment [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Fees | $ 32,400,000 | |||||||||
Percentage of IPO price per share | 80.00% | |||||||||
Percentage of principal converted | 100.00% | |||||||||
Convertible Debt [Member] | Maximum [Member] | 2015 Second-Lien Convertible Debt [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Conversion price | $ / shares | $ 12 | $ 12 | ||||||||
Additional Lenders [Member] | Convertible Debt [Member] | 2015 Second-Lien Convertible Debt [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Number of lenders | item | 3 | |||||||||
Fees | $ 400,000 | $ 400,000 | ||||||||
New Creditors [Member] | Convertible Debt [Member] | 2015 Second-Lien Convertible Debt [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Deferred financing costs | $ 100,000 | $ 100,000 |
Debt (Debt Payable) (Details)
Debt (Debt Payable) (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2016 | Dec. 31, 2015 | |
Debt Instrument [Line Items] | ||
Total debt before fees, interest and debt discount | $ 34,620 | $ 208,260 |
Paid-in-kind interest | 18,726 | |
Less: Deferred financing costs | (865) | (5,861) |
Debt discount | (3,876) | (9,504) |
Total debt payable | 29,879 | 211,621 |
Debt payable, current portion | 4,940 | 1,900 |
Debt payable, long-term | $ 24,939 | 209,721 |
Convertible Debt Due June 17, 2018 [Member] | Convertible Debt [Member] | ||
Debt Instrument [Line Items] | ||
Total debt before fees, interest and debt discount | 58,500 | |
Maturity date | Jun. 17, 2018 | |
Secured Term Debt Due June 17, 2018 [Member] | Secured Debt [Member] | ||
Debt Instrument [Line Items] | ||
Total debt before fees, interest and debt discount | $ 34,620 | 35,000 |
Maturity date | Jun. 17, 2018 | |
Second-Lien Convertible Debt Due August 28, 2019 [Member] | Convertible Debt [Member] | ||
Debt Instrument [Line Items] | ||
Total debt before fees, interest and debt discount | $ 114,760 | |
Maturity date | Aug. 28, 2019 |
Debt (Minimum Payments Required
Debt (Minimum Payments Required on Outstanding Balances) (Details) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Debt Instrument [Line Items] | ||
Total debt payable | $ 29,879 | $ 211,621 |
Credit Agreement [Member] | ||
Debt Instrument [Line Items] | ||
2,016 | 1,520 | |
2,017 | 4,560 | |
2,018 | 28,540 | |
Total debt payable | $ 34,620 |
Debt (Interest Expense and Othe
Debt (Interest Expense and Other Related Financing Costs) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Debt [Abstract] | ||||
Interest expense and other financing costs | $ 1,009 | $ 2,039 | $ 2,862 | $ 7,090 |
Interest expense - beneficial conversion feature | 45,915 | 45,915 | ||
Interest paid-in kind | 2,347 | 2,899 | 14,695 | 6,202 |
Write-off of deferred financing costs and debt discount | 3,820 | 2,752 | 3,820 | 2,752 |
Amortization of deferred financing costs and debt discount | 932 | 1,266 | 3,724 | 3,752 |
Interest expense | $ 54,023 | $ 8,956 | $ 71,016 | $ 19,796 |
Financial Instruments (Narrativ
Financial Instruments (Narrative) (Details) | Aug. 01, 2016USD ($)$ / sharesshares | Aug. 31, 2015USD ($) | Oct. 31, 2011shares | Sep. 30, 2016USD ($)$ / sharesshares | Sep. 30, 2015USD ($) | Sep. 30, 2016USD ($)$ / sharesitemshares | Sep. 30, 2015USD ($) | Dec. 31, 2015USD ($) | Apr. 16, 2013USD ($)$ / sharesshares |
Fair value of liability | $ 4,534,000 | $ 4,534,000 | $ 8,289,000 | ||||||
Warrants reclassified from liabilities to equity | 1,700,000 | ||||||||
Warrants fair value | 1,700,000 | 1,700,000 | 1,900,000 | ||||||
Change in fair value of warrant | 0 | $ (600,000) | (200,000) | $ (1,300,000) | |||||
Price per share of common stock at IPO date | $ / shares | $ 12 | ||||||||
Long-term secured term debt fair value | 24,900,000 | 24,900,000 | 26,300,000 | ||||||
Long-term convertible debt fair value | 183,500,000 | ||||||||
Loss on extingushment of debt | (11,176,000) | (2,934,000) | (11,176,000) | (2,934,000) | |||||
Debt discount | 3,876,000 | $ 3,876,000 | 9,504,000 | ||||||
Number of tranches | item | 3 | ||||||||
Warrants [Member] | |||||||||
Fair value of liability | 4,534,000 | $ 4,534,000 | 8,220,000 | ||||||
Success Fee [Member] | |||||||||
Fair value of liability | $ 0 | 0 | 0 | 69,000 | |||||
Change in fair value of liability | 0 | $ (64,000) | (69,000) | $ (200,000) | |||||
Equity Issued from Credit Agreement [Member] | |||||||||
Fair value of liability | $ 4,500,000 | $ 4,500,000 | $ 6,300,000 | ||||||
Class A Units [Member] | |||||||||
Shares used for underlying value of equity instrument | shares | 536,065 | ||||||||
2015 Credit Agreement [Member] | |||||||||
Warrants outstanding | shares | 617,651 | 617,651 | |||||||
Strike price | $ / shares | $ 10.20 | $ 10.20 | |||||||
Common units converted to warrants | shares | 617,651 | ||||||||
Third Amended and Restated Convertible Credit Agreement [Member] | |||||||||
Common units converted to warrants | shares | 351,992 | ||||||||
Other Warrants [Member] | |||||||||
Strike price | $ / shares | $ 138.06 | $ 21.24 | |||||||
Common units converted to warrants | shares | 46,163 | ||||||||
Warrants issued | $ 1,400,000 | ||||||||
Number of units for purchase | shares | 30,000 | ||||||||
Secured Debt [Member] | 2015 Credit Agreement [Member] | |||||||||
Debt discount | $ 1,500,000 | $ 1,500,000 | |||||||
Secured Debt [Member] | Class A Warrants [Member] | 2015 Credit Agreement [Member] | |||||||||
Warrants to purchase | $ 6,300,000 | 6,300,000 | |||||||
Strike price, percent for calculation | 85.00% | ||||||||
Loss on extingushment of debt | $ 900,000 | 900,000 | |||||||
Debt discount | $ 5,400,000 | $ 5,400,000 | $ 5,400,000 |
Financial Instruments (Fair Val
Financial Instruments (Fair Value Assumptions - Success Fee Instrument) (Details) - Success Fee [Member] | 9 Months Ended |
Sep. 30, 2016$ / shares | |
Unit price | $ 5 |
Strike price | $ 11.41 |
Volatility | 79.20% |
Risk-free interest rate | 0.49% |
Expected life | 6 months |
Expected dividend yield | 0.00% |
Financial Instruments (Fair V48
Financial Instruments (Fair Value Assumptions - Warrants) (Details) - Equity Issued from Credit Agreement [Member] | 9 Months Ended |
Sep. 30, 2016$ / shares | |
Unit price | $ 5 |
Strike price | $ 9.50 |
Volatility | 79.18% |
Risk-free interest rate | 0.49% |
Expected life | 6 months |
Expected dividend yield | 0.00% |
Financial Instruments (Fair V49
Financial Instruments (Fair Value of Financial Instruments) (Details) - USD ($) $ in Thousands | Sep. 30, 2016 | Aug. 01, 2016 | Dec. 31, 2015 |
Total financial instruments | $ 4,534 | $ 8,289 | |
Significant Other Observable Inputs (Level 2) [Member] | |||
Total financial instruments | 4,534 | ||
Significant Unobservable Inputs (Level 3) [Member] | |||
Total financial instruments | 8,289 | ||
Warrants [Member] | |||
Total financial instruments | 4,534 | 8,220 | |
Warrants [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||
Total financial instruments | 4,534 | ||
Warrants [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||
Total financial instruments | 8,220 | ||
Success Fee [Member] | |||
Total financial instruments | $ 0 | $ 0 | 69 |
Success Fee [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||
Total financial instruments | $ 69 |
Financial Instruments (Rollforw
Financial Instruments (Rollforward of Level 3 Investments) (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2016 | Dec. 31, 2015 | |
Significant Other Observable Inputs (Level 2) [Member] | ||
Transfer of warrants from Level 3 to Level 2 | $ 6,300 | |
Change in fair value of financial instruments | (2,878) | |
Beneficial conversion feature recognized on warrants issued in connection with 2015 credit agreement | 1,112 | |
Balance | 4,534 | |
Significant Unobservable Inputs (Level 3) [Member] | ||
Balance | 8,289 | $ 3,483 |
Transfer of warrants from Level 3 to Level 2 | (6,300) | |
Change in fair value of financial instruments | (273) | (1,494) |
Fair value of warrants issued in connection with 2015 credit agreement | 6,300 | |
Reclassification of warrants to APIC in connection with IPO | $ (1,716) | |
Balance | $ 8,289 |
Inventories (Narrative) (Detail
Inventories (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Inventories [Abstract] | |||||
Reserve for expirable inventory | $ 4,800 | $ 4,800 | $ 5,400 | ||
Expensed inventory | $ 129 | $ 1,143 | $ 266 | $ 2,069 |
Inventories (Schedule of Invent
Inventories (Schedule of Inventories) (Details) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Inventories [Abstract] | ||
Raw | $ 1,298 | $ 1,905 |
Finished goods, net | 982 | 1,563 |
Total inventories | $ 2,280 | $ 3,468 |
Goodwill and Other Intangible53
Goodwill and Other Intangible Assets (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | |
Goodwill and Other Intangible Assets [Abstract] | ||||||
Estimated useful life | 3 months | 1 year | ||||
Impairment loss | $ 31,269 | |||||
Amortization expense | $ 3,500 | $ 7,400 | 12,470 | $ 22,180 | 27,442 | |
Accumulated amortization | 138,000 | 138,000 | 125,500 | |||
Remaining balance | $ 2,753 | $ 2,753 | $ 15,223 | $ 73,934 |
Goodwill and Other Intangible54
Goodwill and Other Intangible Assets (Carrying Amount of Goodwill and Other Amortizable Intangible Assets) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Goodwill and Other Intangible Assets [Abstract] | |||||
Ribasphere product rights, Beginning Balance | $ 15,223 | $ 73,934 | $ 73,934 | ||
Ribasphere product rights, Amortization | $ (3,500) | $ (7,400) | (12,470) | (22,180) | (27,442) |
Ribasphere product rights, Impairment | (31,269) | ||||
Ribasphere product rights, Ending Balance | 2,753 | $ 2,753 | $ 15,223 | ||
Ribasphere product rights, Remaining Useful Life | 3 months | 1 year | |||
Goodwill, Beginning Balance | $ 3,580 | $ 3,580 | $ 3,580 | ||
Goodwill, Impairment | |||||
Goodwill, Ending Balance | $ 3,580 | $ 3,580 | $ 3,580 |
License Agreements (Narrative)
License Agreements (Narrative) (Details) | Dec. 16, 2011USD ($) | Nov. 18, 2011USD ($)item | May 31, 2016 | Feb. 29, 2016USD ($) | Nov. 30, 2015USD ($) | Jun. 30, 2008USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2016USD ($) | Dec. 31, 2015USD ($) | Sep. 30, 2015USD ($) | Dec. 31, 2015USD ($) | Sep. 30, 2016USD ($) |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||||||||||
Revenue | $ 4,345,000 | $ 9,802,000 | $ 15,504,000 | $ 23,576,000 | |||||||||
Proceeds from issuance of redeemable convertible units | 5,500,000 | 558,000 | |||||||||||
Research and development | 9,550,000 | 8,439,000 | 27,134,000 | 23,344,000 | |||||||||
Gain on settlement of payable | 256,000 | 4,131,000 | |||||||||||
Other milestone payable | $ 3,875,000 | $ 3,875,000 | |||||||||||
Loss on equity method investment | $ (1,741,000) | (533,000) | (12,270,000) | (1,121,000) | |||||||||
License Agreement, Valeant Holdings International, Syprine [Member] | |||||||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||||||||||
Gain on settlement of payable | $ 3,900,000 | ||||||||||||
License Agreement, Vivus, Inc. [Member] | |||||||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||||||||||
License agreement sales | $ 0 | $ 0 | $ 0 | ||||||||||
License Agreement, MeiraGTx Ltd. [Member] | |||||||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||||||||||
Equity method investment, ownership percentage | 38.70% | 38.70% | 44.40% | 44.40% | 38.70% | ||||||||
Equity method investment, fair value | $ 24,000,000 | $ 24,000,000 | $ 24,000,000 | ||||||||||
Equity method investment, gross profit (loss) | (1,700,000) | (500,000) | (12,300,000) | $ (2,800,000) | (1,100,000) | ||||||||
Loss on equity method investment | (5,100,000) | ||||||||||||
License Agreement, Chiromics [Member] | |||||||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||||||||||
License agreement, upfront fee / payment | $ 200,000 | ||||||||||||
Other milestone payable | 500,000 | 500,000 | $ 500,000 | $ 500,000 | $ 500,000 | ||||||||
Number of chemical compounds | item | 2 | ||||||||||||
License agreement, fee for chemical compound | $ 150,000 | ||||||||||||
License agreement, quarterly fee for chemical compounds | $ 200,000 | ||||||||||||
Number of quarters, quarterly fee for chemical compounds | item | 8 | ||||||||||||
License Agreement, Concordia [Member] | |||||||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||||||||||
License agreement, upfront fee / payment | $ 500,000 | ||||||||||||
License Agreement, Zydus [Member] | |||||||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||||||||||
One time purchase price of rights, title and interest to high dosages of ribavirin | $ 1,100,000 | ||||||||||||
Estimated percentage of royalty based on net sales of products | 20.00% | ||||||||||||
Royalty expense | 300,000 | 700,000 | $ 1,100,000 | 2,100,000 | |||||||||
License Agreement, Jinghua [Member] | |||||||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||||||||||
Proceeds from issuance of redeemable convertible units | $ 10,000,000 | ||||||||||||
License agreement, term | 10 years | ||||||||||||
Revenue recognition, milestone method, revenue recognized | $ 2,000,000 | ||||||||||||
Estimated percentage of sublicensing revenue | 10.00% | ||||||||||||
License Agreement, Jinghua [Member] | Maximum [Member] | |||||||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||||||||||
Contingent milestone payments | $ 40,000,000 | ||||||||||||
Estimated percentage of sublicensing revenue | 30.00% | ||||||||||||
License Agreement, Jinghua [Member] | Minimum [Member] | |||||||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||||||||||
Estimated percentage of sublicensing revenue | 10.00% | ||||||||||||
License Agreement, Camber Pharmaceuticals, Inc., Tetrabenazine [Member] | |||||||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||||||||||
Revenue | 300,000 | $ 0 | $ 400,000 | $ 0 | |||||||||
License agreement, term | 12 months | ||||||||||||
Supply and distribution agreement, percentage of revenue retained | 100.00% | ||||||||||||
License Agreement, Camber Pharmaceuticals, Inc., Valganciclovir [Member] | |||||||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||||||||||
License agreement sales | $ 0 | ||||||||||||
Revenue | $ 500,000 | $ 700,000 | |||||||||||
Supply and distribution agreement, percentage of revenue retained | 100.00% |
License Agreements (Summarized
License Agreements (Summarized Financial Information for MeiraGTx) (Details) - MeiraGTx Ltd. [Member] $ in Thousands | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Schedule of Equity Method Investments [Line Items] | |
Cash | $ 14,548 |
Other current assets | 433 |
Noncurrent assets | 42 |
Current liabilities | 4,621 |
Noncurrent liabilities | 17 |
Total stockholders’ equity | 9,249 |
General and administrative expense | 4,184 |
Research and development expense | 9,876 |
Net loss attributable to non‑controlling interest in subsidiary | 829 |
Net loss and comprehensive loss | $ (13,154) |
Share-based Compensation (Narra
Share-based Compensation (Narrative) (Details) - USD ($) | Jul. 13, 2016 | Dec. 31, 2015 | Aug. 31, 2015 | Jan. 31, 2015 | Dec. 31, 2014 | May 31, 2014 | Jul. 31, 2011 | Sep. 30, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Aug. 01, 2016 | Apr. 16, 2013 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Share based compensation, options granted | 0 | |||||||||||||||
Options Outstanding, Units, Exercised | 1,109 | 772 | ||||||||||||||
Options Outstanding, Value, Exercised | $ 4,800 | |||||||||||||||
Weighted average grant date fair value of options granted during the period (per share) | $ 7.60 | $ 20.67 | ||||||||||||||
Price per share of common stock at IPO date | $ 12 | |||||||||||||||
Equity instruments number of shares authorized as a percentage of equity value | 10.00% | |||||||||||||||
Chief Executive Officer [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Percent available to grant out of outstanding units | 5.00% | |||||||||||||||
Exercise price | $ 39 | $ 39 | ||||||||||||||
Option Agreement, December 31, 2015 [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Stock compensation expense | $ 5,100,000 | $ 5,900,000 | ||||||||||||||
Option Agreement, December 31, 2015 [Member] | Chief Executive Officer [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Share based compensation, options granted | 769,231 | |||||||||||||||
Share based compensation, options granted, value | $ 15,200,000 | |||||||||||||||
Option Agreement, December 31, 2015 [Member] | Tranche One [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Vesting percentage | 33.30% | |||||||||||||||
Option Agreement, December 31, 2015 [Member] | Tranche Two [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Vesting percentage | 33.30% | |||||||||||||||
Option Agreement, December 31, 2015 [Member] | Tranche Three [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Vesting percentage | 33.30% | |||||||||||||||
Option Agreement, July 13, 2016 [Member] | Chief Executive Officer [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Share based compensation, options granted | 1,630,536 | |||||||||||||||
Modification charge | $ 12,400,000 | |||||||||||||||
Incremental modification charge | $ 8,300,000 | |||||||||||||||
Company's outstanding common equity at IPO date, percentage | 5.00% | |||||||||||||||
Percentage of options forfeited | 25.00% | |||||||||||||||
Additional year of service | 2 years | |||||||||||||||
Option Agreement, July 13, 2016 [Member] | Tranche One [Member] | Chief Executive Officer [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Incremental modification charge | $ 4,100,000 | |||||||||||||||
2011 Equity Incentive Plan [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Additional units available for grant | 2,715,099 | |||||||||||||||
Unrecognized compensation expense | $ 18,600,000 | $ 15,600,000 | $ 18,600,000 | $ 15,600,000 | $ 18,600,000 | |||||||||||
Weighted average period for recognition of compensation expense | 1 year 7 months 6 days | 2 years 1 month 6 days | ||||||||||||||
Stock compensation expense | 35,500,000 | $ 1,300,000 | $ 41,400,000 | $ 4,700,000 | ||||||||||||
2011 Equity Incentive Plan [Member] | January 2015 Modification [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Incremental modification charge | $ 1,100,000 | |||||||||||||||
Stock compensation expense | $ 668,000 | |||||||||||||||
2011 Equity Incentive Plan [Member] | July 2016 Modification [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Incremental modification charge | 4,000,000 | |||||||||||||||
Stock compensation expense | $ 1,800,000 | |||||||||||||||
Remaining stock compensation | $ 2,200,000 | |||||||||||||||
Number of shares affected by modification | 1,600,000 | |||||||||||||||
2011 Equity Incentive Plan [Member] | Tranche One [Member] | January 2015 Modification [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Vesting period | 1 year | |||||||||||||||
2011 Equity Incentive Plan [Member] | Tranche Two [Member] | January 2015 Modification [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Vesting period | 2 years | |||||||||||||||
2016 Equity Incentive Plan [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Increase in authorized shares as a percentage of common stock issued | 4.00% | |||||||||||||||
Incentive plan termination period | 10 years | |||||||||||||||
Shares authorized for issuance | 6,720,000 | 6,720,000 | ||||||||||||||
2014 Long-Term Incentive Plan (“LTIP”) [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Stock compensation expense | $ 22,600,000 | $ 0 | ||||||||||||||
Equity instruments granted | 9,750 | 9,750 | ||||||||||||||
2014 Long-Term Incentive Plan (“LTIP”) [Member] | Equity Appreciation Rights Units [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Equity instruments granted | 1,250 | 8,500 | ||||||||||||||
Equity instruments base price | $ 6 | $ 6 | ||||||||||||||
Equity instruments expiration period | 10 years | 10 years | ||||||||||||||
Equity instruments payment as a percentage of fair market value of outstanding equity | 0.001% | 0.001% | ||||||||||||||
2016 Employee Stock Purchase Plan [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Additional units available for grant | 750,000 | |||||||||||||||
Increase in authorized shares as a percentage of common stock issued | 1.50% | |||||||||||||||
Shares authorized for issuance | 1,125,000 | 1,125,000 | ||||||||||||||
Maximum payroll deduction | 10.00% | 10.00% | ||||||||||||||
Offering period | 27 months | |||||||||||||||
Amount divided by market price to determine number of shares | $ 2,083 | |||||||||||||||
Percentage of fair market value of common stock | 85.00% | |||||||||||||||
Class A [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Unit price | $ 7.34 | $ 7.34 | ||||||||||||||
Class A [Member] | 2011 Equity Incentive Plan [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Percent available to grant out of outstanding units | 7.50% | |||||||||||||||
Class A [Member] | 2011 Equity Incentive Plan [Member] | January 2015 Modification [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Exercise price | $ 6 | |||||||||||||||
Other Warrants [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Warrants exercise price | $ 138.06 | $ 21.24 | ||||||||||||||
2015 Credit Agreement [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Warrants outstanding | 617,651 | 617,651 | ||||||||||||||
Warrants exercise price | $ 10.20 | $ 10.20 | ||||||||||||||
2015 Credit Agreement [Member] | Class A Warrants [Member] | Secured Debt [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Warrants to purchase | $ 6,300,000 | $ 6,300,000 | ||||||||||||||
Minimum [Member] | 2011 Equity Incentive Plan [Member] | July 2016 Modification [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Vesting period | 1 year | |||||||||||||||
Minimum [Member] | 2016 Employee Stock Purchase Plan [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Number of hours per week for eligibility | 20 hours | |||||||||||||||
Number of months employed for eligibility | 5 months | |||||||||||||||
Number of shares for ESPP for offering period | 200 | |||||||||||||||
Maximum [Member] | 2011 Equity Incentive Plan [Member] | July 2016 Modification [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Vesting period | 3 years | |||||||||||||||
Maximum [Member] | 2016 Employee Stock Purchase Plan [Member] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Percentage of ownership of stock or options | 5.00% | |||||||||||||||
Rate of yearly ownership value | $ 25,000 |
Share-based Compensation (Unit
Share-based Compensation (Unit Options Outstanding) (Details) - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Options Outstanding, Units, Granted | 0 | ||
Options Outstanding, Units, Exercised | (1,109) | (772) | |
Options [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Options Outstanding, Units, Beginning Balance | 1,685,248 | 706,460 | |
Options Outstanding, Units, Granted | 1,630,536 | 1,154,394 | |
Options Outstanding, Units, Exercised | (1,109) | (772) | |
Options Outstanding, Units, Forfeited | (68,932) | (174,834) | |
Options Outstanding, Units, Ending Balance | 3,245,743 | 1,685,248 | 706,460 |
Options Outstanding, Weighted Average Exercise Price, Beginning Balance | $ 37.38 | $ 52.15 | |
Options Outstanding, Weighted Average Exercise Price, Granted | 12 | 37.44 | |
Options Outstanding, Weighted Average Exercise Price, Exercised | 36.63 | 38.70 | |
Options Outstanding, Weighted Average Exercise Price, Forfeited | 35.46 | 57.68 | |
Options Outstanding, Weighted Average Exercise Price, Ending Balance | $ 12 | $ 37.38 | $ 52.15 |
Options Outstanding, Weighted Average Remaining Contractual Term (years) | 8 years 10 months 24 days | 8 years 8 months 19 days | 8 years 7 months 17 days |
Options Outstanding, Aggregate Intrinsic Value (in thousands) | |||
Options Exercisable, Units | 2,022,936 | 381,072 | 266,518 |
Options Exercisable, Weighted Average Exercise Price | $ 12 | $ 36.29 | $ 50.50 |
Share-based Compensation (Weigh
Share-based Compensation (Weighted-average Fair Value of Stock Option Awards Granted) (Details) - $ / shares | 9 Months Ended | 12 Months Ended |
Sep. 30, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted average fair value of grants | $ 7.60 | $ 20.67 |
Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted average fair value of grants | $ 7.60 | $ 20.67 |
Expected volatility | 79.35% | |
Risk-free interest rate | 1.15% | |
Expected life | 5 years | |
Expected dividend yield | 0.00% | 0.00% |
Options [Member] | Minimum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected volatility | 77.23% | |
Risk-free interest rate | 1.54% | |
Expected life | 5 years 2 months 12 days | |
Options [Member] | Maximum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected volatility | 93.85% | |
Risk-free interest rate | 1.93% | |
Expected life | 6 years |
Share-based Compensation (Warra
Share-based Compensation (Warrants Outstanding) (Details) | 9 Months Ended |
Sep. 30, 2016$ / sharesshares | |
Share-based Compensation [Abstract] | |
Warrants, beginning balance | shares | 710,801 |
Warrants, granted | shares | 617,651 |
Warrants, exercised | shares | |
Warrants, forfeited | shares | |
Warrants, ending balance | shares | 1,328,452 |
Weighted average exercise price, beginning balance | $ / shares | $ 46.64 |
Weighted average exercise price, granted | $ / shares | 10.20 |
Weighted average exercise price, exercised | $ / shares | |
Weighted average exercise price, forfeited | $ / shares | |
Weighted average exercise price, ending balance | $ / shares | $ 29.70 |
Accrued Expenses and Other Sh61
Accrued Expenses and Other Short Term Liabilities (Narrative) (Details) | Aug. 01, 2016USD ($)shares | Apr. 30, 2016shares | Apr. 30, 2015shares | Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($)$ / shares | Sep. 30, 2016USD ($)$ / sharesitemshares | Sep. 30, 2015USD ($)$ / shares | Dec. 31, 2015USD ($)shares | Dec. 31, 2014USD ($)shares | Mar. 31, 2016USD ($) | Oct. 31, 2014$ / shares |
Short-Term Accrued Expenses [Line Items] | |||||||||||
Value of common stock issued for services | $ 2,500,000 | ||||||||||
Gross proceeds from issuance of redeemable convertible units | $ 39,500,000 | ||||||||||
Net proceeds from issuance of redeemable convertible units | 36,400,000 | ||||||||||
Stock issuance costs | $ 3,700,000 | 2,551,000 | $ 3,100,000 | ||||||||
Stock issued, shares | shares | 6,250,000 | ||||||||||
Severence expense | 600,000 | $ 600,000 | |||||||||
Severence cost | $ 1,555,000 | 1,555,000 | 578,000 | ||||||||
Accrued expenses | 12,437,000 | 12,437,000 | 11,843,000 | ||||||||
Other long term liabilities | 1,511,000 | $ 1,511,000 | 3,152,000 | ||||||||
Units granted | shares | 617,651 | ||||||||||
Term of lock-up agreement related to IPO | 180 days | ||||||||||
Percentage ownership triggering reduced lock-up term | 5.00% | ||||||||||
Term of maximum lock-up agreement in event of 5% ownership and subsequent offering (90 days) | 90 days | ||||||||||
Minimum gross IPO proceeds to avoid amendment fee | $ 75,000,000 | ||||||||||
Conditional amendment fee payable | 1,300,000 | ||||||||||
Shares issued for debt finance costs | shares | 108,696 | ||||||||||
Royalty arrangements | 3,309,000 | $ 3,309,000 | 2,777,000 | ||||||||
Deferred revenue, short term | 4,424,000 | $ 4,424,000 | 4,500,000 | ||||||||
Falcon Flight Agreement [Member] | |||||||||||
Short-Term Accrued Expenses [Line Items] | |||||||||||
Litigation settlement, shares | shares | 1,061,741 | ||||||||||
Litigation settlement, amount payable upon closing of IPO | 800,000 | $ 800,000 | |||||||||
Littigtion settlement, expense | 2,600,000 | 10,400,000 | |||||||||
Royalty Arrangement [Member] | |||||||||||
Short-Term Accrued Expenses [Line Items] | |||||||||||
Royalty expense | 300,000 | $ 700,000 | 1,100,000 | $ 2,100,000 | |||||||
Deferred revenue, short term | 2,900,000 | 2,900,000 | $ 2,000,000 | ||||||||
Board of Directors Chairman [Member] | |||||||||||
Short-Term Accrued Expenses [Line Items] | |||||||||||
Severence expense | 2,400,000 | ||||||||||
Severence cost | 3,000,000 | 3,000,000 | |||||||||
Severance costs, due in year one | 1,000,000 | 1,000,000 | |||||||||
Severance costs, due in year two | 2,000,000 | 2,000,000 | |||||||||
Severance costs including medical benefits | 3,100,000 | ||||||||||
Accrued expenses | 1,000,000 | 1,000,000 | |||||||||
Other long term liabilities | 1,400,000 | $ 1,400,000 | |||||||||
Percent of cash received or receivable from business development programs to be used for research and development | 5.00% | ||||||||||
Cap on cash received or receivable from business development programs to be used for research and development | $ 15,000,000 | ||||||||||
Number of business development programs qualifying for contributions to research and development | item | 3 | ||||||||||
Cash received or receivable from business development program before IPO to trigger fulfillment of conditional severance payments | $ 800,000,000 | ||||||||||
Units granted | shares | 5,000 | ||||||||||
Board of Directors Chairman [Member] | Supplemental Conditional Payments [Member] | |||||||||||
Short-Term Accrued Expenses [Line Items] | |||||||||||
Aggregate payments | 6,750,000 | 6,750,000 | |||||||||
Payments, 2017 | 2,250,000 | 2,250,000 | |||||||||
Payments, 2018 | 2,250,000 | 2,250,000 | |||||||||
Payments, 2019 | 2,250,000 | 2,250,000 | |||||||||
Minimum payables to trigger supplemental conditional payments | 50,000,000 | ||||||||||
Class A Units [Member] | |||||||||||
Short-Term Accrued Expenses [Line Items] | |||||||||||
Value of common stock issued for services | $ 125,000 | ||||||||||
Shares issued for advisory agreement | shares | 1,500,000 | 25,000 | |||||||||
Stock issued, shares | shares | 1,250,000 | ||||||||||
Unit price | $ / shares | $ 32.50 | $ 32.50 | $ 39 | ||||||||
Class E Redeemable Convertible Units [Member] | |||||||||||
Short-Term Accrued Expenses [Line Items] | |||||||||||
Value of common stock issued for services | $ 13,460,000 | ||||||||||
Shares issued for advisory agreement | shares | 1,170,437 | ||||||||||
Stock issuance costs | $ 40,000 | ||||||||||
Stock issued, shares | shares | 478,266 | 945,441 | 3,438,984 | ||||||||
Class E Redeemable Convertible Units [Member] | Board of Directors Chairman [Member] | |||||||||||
Short-Term Accrued Expenses [Line Items] | |||||||||||
Stock issued, shares | shares | 21,740 | ||||||||||
2015 Stock Issuance [Member] | |||||||||||
Short-Term Accrued Expenses [Line Items] | |||||||||||
Accrued liabilities current, commsions payable | 40,000 | $ 40,000 | $ 40,000 | ||||||||
2014 Stock Issuance [Member] | |||||||||||
Short-Term Accrued Expenses [Line Items] | |||||||||||
Accrued liabilities current, commsions payable | 2,400,000 | 2,400,000 | 2,400,000 | ||||||||
2015 Second-Lien Convertible Debt [Member] | |||||||||||
Short-Term Accrued Expenses [Line Items] | |||||||||||
Borrowings, face amount | $ 92,000,000 | $ 92,000,000 | 15,000,000 | ||||||||
Fees | 600,000 | ||||||||||
Debt instrument, commission fee payable in cash | 300,000 | 300,000 | |||||||||
2015 Second-Lien Convertible Debt [Member] | Class A Units [Member] | |||||||||||
Short-Term Accrued Expenses [Line Items] | |||||||||||
Debt instrument, commission fee payable with equity | 300,000 | 300,000 | |||||||||
Value of common stock issued for services | $ 125,000 | ||||||||||
Shares issued for advisory agreement | shares | 25,000 | ||||||||||
Equity Appreciation Rights Units [Member] | Board of Directors Chairman [Member] | |||||||||||
Short-Term Accrued Expenses [Line Items] | |||||||||||
Price of units granted | $ / shares | $ 6 | ||||||||||
2014 Long-Term Incentive Plan (“LTIP”) [Member] | |||||||||||
Short-Term Accrued Expenses [Line Items] | |||||||||||
Stock compensation expense | 22,600,000 | 0 | |||||||||
2014 Long-Term Incentive Plan (“LTIP”) [Member] | Board of Directors Chairman [Member] | |||||||||||
Short-Term Accrued Expenses [Line Items] | |||||||||||
Stock compensation expense | $ 11,600,000 | ||||||||||
2014 Long-Term Incentive Plan (“LTIP”) [Member] | Equity Appreciation Rights Units [Member] | Board of Directors Chairman [Member] | |||||||||||
Short-Term Accrued Expenses [Line Items] | |||||||||||
Vesting condition, Percent increase in fair market value per unit | shares | 333 | ||||||||||
Third Party Investors [Member] | |||||||||||
Short-Term Accrued Expenses [Line Items] | |||||||||||
Gross proceeds from issuance of redeemable convertible units | 873,000 | ||||||||||
Net proceeds from issuance of redeemable convertible units | 833,000 | ||||||||||
Stock issuance costs | $ 40,000 | ||||||||||
Third Party Investors [Member] | Class E Redeemable Convertible Units [Member] | |||||||||||
Short-Term Accrued Expenses [Line Items] | |||||||||||
Stock issued, shares | shares | 75,875 |
Accrued Expenses and Other Sh62
Accrued Expenses and Other Short Term Liabilities (Short-term Accrued Expenses) (Details) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Accrued Expenses and Other Short Term Liabilities [Abstract] | ||
Commission payable | $ 2,695 | $ 2,820 |
Accrued bonus | 393 | 362 |
Severence | 1,555 | 578 |
Other compensation and benefits | 778 | 956 |
Financing/Offering Costs | 1,250 | |
Threatened litigation | 10,377 | |
Royalty arrangements | 3,309 | 2,777 |
Other | 3,707 | 3,100 |
Total Accrued Expenses | $ 12,437 | $ 22,220 |
Commitments (Narrative) (Detail
Commitments (Narrative) (Details) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2016USD ($)stateshares | Sep. 30, 2015USD ($) | Sep. 30, 2016USD ($)stateitemshares | Sep. 30, 2015USD ($) | Dec. 31, 2015USD ($)shares | Aug. 01, 2016shares | |
Commitments [Line Items] | ||||||
Number of primary operating locations | state | 3 | 3 | ||||
Additional contigent milestone payments | $ 300,000 | $ 300,000 | ||||
Amount payable upon consummation of IPO | $ 1,250,000 | $ 1,250,000 | ||||
Common stock issued | shares | 45,078,666 | 45,078,666 | 0 | |||
Employment agrrement liability | $ 2,600,000 | $ 2,600,000 | $ 2,600,000 | |||
Severence expense | 600,000 | $ 600,000 | ||||
Future Discretionary Clinical Developments and Regulatory Agency Actions [Member] | ||||||
Commitments [Line Items] | ||||||
Additional contigent milestone payments | 431,400,000 | $ 431,400,000 | ||||
New York [Member] | ||||||
Commitments [Line Items] | ||||||
Number of amendments | item | 4 | |||||
Expiration date | Oct. 1, 2024 | |||||
Rental expense | 1,200,000 | $ 1,200,000 | $ 3,500,000 | $ 3,500,000 | ||
Base rent annual percentage increase | 3.50% | |||||
Pennsylvania [Member] | ||||||
Commitments [Line Items] | ||||||
Expiration date | Sep. 30, 2019 | |||||
Renewal option | 5 years | |||||
Rental expense | 143,000 | $ 144,000 | $ 429,000 | 461,000 | ||
Massachusetts [Member] | ||||||
Commitments [Line Items] | ||||||
Expiration date | Apr. 1, 2023 | |||||
Rental expense | 85,000 | $ 257,000 | $ 0 | |||
Secured Letter of Credit [Member] | New York [Member] | ||||||
Commitments [Line Items] | ||||||
Secured letter of credit | 2,000,000 | 2,000,000 | ||||
Secured Letter of Credit [Member] | Massachusetts [Member] | ||||||
Commitments [Line Items] | ||||||
Secured letter of credit | $ 91,000 | $ 91,000 | ||||
Former Employees [Member] | ||||||
Commitments [Line Items] | ||||||
Common stock issued | shares | 208,334 |
Commitments (Future Minimum Ren
Commitments (Future Minimum Rental Payments Under Noncancellable Leases) (Details) $ in Thousands | Sep. 30, 2016USD ($) |
Commitments [Abstract] | |
2,016 | $ 1,428 |
2,017 | 5,796 |
2,018 | 5,912 |
2,019 | 5,828 |
2,020 | 5,449 |
Thereafter | 22,020 |
Total | $ 46,433 |
Commitments (Firm Payment Commi
Commitments (Firm Payment Commitments Under License Agreements) (Details) $ in Thousands | Sep. 30, 2016USD ($) |
Commitments [Abstract] | |
2,017 | $ 60 |
2,018 | 60 |
2,019 | 60 |
2,020 | 60 |
Thereafter | 60 |
Total | $ 300 |
Contingencies (Details)
Contingencies (Details) $ in Millions | Sep. 06, 2016USD ($) | Jul. 25, 2016USD ($) | Dec. 31, 2015claim |
The Belesis Litigation [Member] | |||
Loss Contingencies [Line Items] | |||
Number of claims filed | claim | 12 | ||
The Glodek Litigation [Member] | |||
Loss Contingencies [Line Items] | |||
Claim amount | $ | $ 4 | $ 2.8 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Thousands | 1 Months Ended | 9 Months Ended | |||||
Jan. 31, 2015 | Sep. 30, 2015 | Sep. 30, 2016 | Dec. 31, 2015 | Aug. 31, 2015 | Apr. 30, 2015 | Dec. 31, 2014 | |
Related Party Transaction [Line Items] | |||||||
Derivative liability | $ 8,289 | ||||||
Related party loans outstanding | $ 3,000 | 3,000 | $ 3,500 | ||||
Settlement of related party loan | $ 500 | $ 500 | |||||
Equity investment | 8,954 | 21,224 | |||||
Interest free loans | $ 2,000 | ||||||
Class A [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Derivative liability | $ 0 | $ 69 | |||||
Class E Redeemable Convertible Units [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Preferred stock issued | 43,478 | ||||||
Kadmon I [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Ownership percentage | 12.10% | ||||||
Kadmon I [Member] | Class A [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Ownership percentage | 66.00% | 66.00% | |||||
MeiraGTx [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Ownership percentage | 48.00% | ||||||
Equity investment | $ 24,000 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Change in deferred tax liability | $ 0 | $ 0 |
Income tax expense | 315 | |
License Agreement, Jinghua [Member] | ||
Income tax expense | 300 | $ 0 |
Milestone payment | $ 2,000 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | Nov. 04, 2016 | Sep. 30, 2016 | Dec. 31, 2015 | Sep. 30, 2016 |
License Agreement, Vivus, Inc. [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
License agreement sales | $ 0 | $ 0 | $ 0 | |
2015 Credit Agreement [Member] | Subsequent Event [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Deferred Principal Payments | $ 380,000 | |||
Additional equity capital to be raised | $ 40,000,000 |