Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Feb. 17, 2020 | Jun. 30, 2019 | |
Document and Entity Information [Abstract] | |||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2019 | ||
Entity Registrant Name | STRONGBRIDGE BIOPHARMA plc | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 159,280,967 | ||
Entity Common Stock, Shares Outstanding | 54,247,285 | ||
Entity Central Index Key | 0001634432 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 57,032 | $ 122,490 |
Marketable securities | 21,072 | |
Accounts receivable | 2,289 | 1,626 |
Inventory | 1,993 | 3,946 |
Prepaid expenses and other current assets | 1,157 | 4,236 |
Total current assets | 83,543 | 132,298 |
Property and equipment, net | 291 | 294 |
Right of use asset, net | 789 | |
Intangible asset, net | 25,110 | 30,132 |
Goodwill | 7,256 | 7,256 |
Other assets | 649 | 305 |
Total assets | 117,638 | 170,285 |
Current liabilities: | ||
Accounts payable | 3,331 | 1,184 |
Accrued and other current liabilities | 20,962 | 16,065 |
Total current liabilities | 24,293 | 17,249 |
Warrant liability | 4,127 | 15,513 |
Supply agreement liability, noncurrent | 15,947 | 24,568 |
Other long-term liabilities | 1,080 | |
Total liabilities | 45,447 | 57,330 |
Commitments and contingencies (Note 10) | ||
Stockholders’ equity: | ||
Deferred shares, $1.098 par value, 40,000 shares authorized, issued and outstanding at December 31, 2019 and December 31, 2018 | 44 | 44 |
Ordinary shares, $0.01 par value, 600,000,000 shares authorized at December 31, 2019 and December 31, 2018; 54,205,852 and 54,122,074 shares issued and outstanding at December 31, 2019 and December 31, 2018 | 542 | 541 |
Additional paid-in capital | 332,085 | 323,402 |
Accumulated deficit | (260,483) | (211,032) |
Accumulated other comprehensive income | 3 | |
Total stockholders’ equity | 72,191 | 112,955 |
Total liabilities and stockholders’ equity | $ 117,638 | $ 170,285 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
Consolidated Balance Sheets | ||
Deferred shares, par value (in dollars per share) | $ 1.098 | $ 1.098 |
Deferred shares, shares authorized | 40,000 | 40,000 |
Deferred shares, shares issued | 40,000 | 40,000 |
Deferred shares, shares outstanding | 40,000 | 40,000 |
Ordinary shares, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Ordinary shares, shares authorized | 600,000,000 | 600,000,000 |
Ordinary shares, shares issued | 54,205,852 | 54,122,074 |
Ordinary shares, shares outstanding | 54,205,852 | 54,122,074 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenues: | |||
Total revenues | $ 21,712 | $ 18,027 | $ 7,046 |
Cost and expenses: | |||
Cost of sales (excluding amortization of intangible assets) | 3,822 | 3,986 | 1,483 |
Selling, general and administrative | 49,058 | 63,336 | 36,292 |
Research and development | 30,903 | 25,441 | 17,268 |
Amortization of intangible assets | 5,022 | 7,187 | 5,022 |
Impairment of intangible asset | 20,723 | ||
Total cost and expenses | 88,805 | 99,950 | 80,788 |
Operating loss | (67,093) | (81,923) | (73,742) |
Other income (loss), net: | |||
Income from field services agreement | 12,616 | ||
Expense from field services agreement | (6,652) | ||
Unrealized gain (loss) on fair value of warrants | 11,386 | 16,337 | (30,218) |
Interest expense | (12,515) | (4,313) | |
Loss on extinguishment of debt | (21,549) | (3,545) | |
Gain on sale of subsidiary | 130,832 | ||
Other income, net | 2,060 | 1,205 | 106 |
Total other income (loss), net | 19,410 | 114,310 | (37,970) |
Income (loss) before income taxes | (47,683) | 32,387 | (111,712) |
Income tax expense | (1,768) | (536) | (1,771) |
Net income (loss) | (49,451) | 31,851 | (113,483) |
Unrealized gain on marketable securities | 3 | ||
Comprehensive loss | (49,448) | 31,851 | (113,483) |
Net income (loss) attributable to ordinary shareholders: | |||
Basic | (49,451) | 31,851 | (113,483) |
Diluted | $ (60,837) | $ 15,514 | $ (113,483) |
Net (loss) income per share attributable to ordinary shareholders: | |||
Basic (in dollars per share) | $ (0.91) | $ 0.69 | $ (3.11) |
Diluted (in dollars per share) | $ (1.10) | $ 0.31 | $ (3.11) |
Weighted-average shares used in computing net (loss) income per share attributable to ordinary shareholders: | |||
Basic (in shares) | 54,182,499 | 46,297,088 | 36,544,825 |
Diluted (in shares) | 55,383,030 | 49,724,503 | 36,544,825 |
Product | |||
Revenues: | |||
Total revenues | $ 21,676 | $ 18,027 | $ 7,046 |
Royalty | |||
Revenues: | |||
Total revenues | $ 36 |
Consolidated Statement of Stock
Consolidated Statement of Stockholders' (Deficit) Equity - USD ($) $ in Thousands | Ordinary SharesIssuance of shares, Public offering | Ordinary SharesIssuance of shares, Public offering and concurrent with CRG credit facility | Ordinary SharesATM FacilityMaximum | Ordinary SharesATM Facility | Ordinary SharesMaximum | Ordinary Shares | Deferred Shares | Additional Paid-In CapitalIssuance of shares, Public offering | Additional Paid-In CapitalIssuance of shares, Public offering and concurrent with CRG credit facility | Additional Paid-In CapitalATM Facility | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Income | Issuance of shares, Public offering | Issuance of shares, Public offering and concurrent with CRG credit facility | ATM Facility | Total |
Balance at beginning of period at Dec. 31, 2016 | $ 353 | $ 44 | $ 195,975 | $ (129,400) | $ 66,972 | ||||||||||||
Balance (in shares) at Dec. 31, 2016 | 35,335,026 | 40,000 | |||||||||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||||
Net loss | (113,483) | (113,483) | |||||||||||||||
Stock-based compensation | 5,167 | 5,167 | |||||||||||||||
Issuance of shares, net of offering costs | $ 44 | $ 1 | $ 26,340 | $ 73 | $ 26,384 | $ 73 | |||||||||||
Issuance of shares, net of offering costs (in shares) | 4,429,799 | 10,300 | |||||||||||||||
Exercise of warrants | $ 2 | (2) | |||||||||||||||
Exercise of warrants (in shares) | 178,606 | ||||||||||||||||
Issuance of warrants related to the loan agreements | 2,347 | 2,347 | |||||||||||||||
Exercise of stock options | $ 2 | 624 | 626 | ||||||||||||||
Exercise of stock options (in shares) | 196,081 | ||||||||||||||||
Balance at end of period at Dec. 31, 2017 | $ 401 | $ 44 | 230,524 | (242,883) | (11,914) | ||||||||||||
Balance (in shares) at Dec. 31, 2017 | 40,149,812 | 40,000 | |||||||||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||||
Net loss | 31,851 | 31,851 | |||||||||||||||
Stock-based compensation | 7,807 | 7,807 | |||||||||||||||
Issuance of shares, net of offering costs | $ 53 | $ 13 | $ 33,455 | $ 8,583 | $ 33,508 | $ 8,596 | |||||||||||
Issuance of shares, net of offering costs (in shares) | 5,255,683 | 1,281,903 | |||||||||||||||
Issuance of shares to Novo | $ 52 | 22,331 | 22,383 | ||||||||||||||
Issuance of shares to Novo (in shares) | 5,242,000 | ||||||||||||||||
Issuance of shares to CRG | $ 7 | 2,798 | 2,805 | ||||||||||||||
Issuance of shares to CRG (in shares) | 656,929 | ||||||||||||||||
Exercise of warrants | $ 14 | 10,619 | 10,633 | ||||||||||||||
Exercise of warrants (in shares) | 1,384,062 | ||||||||||||||||
Issuance of warrants related to the loan agreements | 7,663 | 7,663 | |||||||||||||||
Exercise of stock options | $ 1 | 96 | 96 | ||||||||||||||
Exercise of stock options (in shares) | 50,654 | ||||||||||||||||
Ordinary shares issued, net of shares withheld for employee taxes | $ 1 | (474) | (473) | ||||||||||||||
Ordinary shares issued, net of shares withheld for employee taxes (in shares) | 101,031 | ||||||||||||||||
Balance at end of period at Dec. 31, 2018 | $ 541 | $ 44 | 323,402 | (211,032) | 112,955 | ||||||||||||
Balance (in shares) at Dec. 31, 2018 | 54,122,074 | 40,000 | |||||||||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||||
Net loss | (49,451) | (49,451) | |||||||||||||||
Stock-based compensation | 8,597 | 8,597 | |||||||||||||||
Exercise of stock options | $ 1 | 178 | 179 | ||||||||||||||
Exercise of stock options (in shares) | 43,841 | ||||||||||||||||
Ordinary shares issued, net of shares withheld for employee taxes | $ 1 | (92) | (92) | ||||||||||||||
Ordinary shares issued, net of shares withheld for employee taxes (in shares) | 39,937 | ||||||||||||||||
Unrealized gain on marketable securities | $ 3 | 3 | |||||||||||||||
Balance at end of period at Dec. 31, 2019 | $ 542 | $ 44 | $ 332,085 | $ (260,483) | $ 3 | $ 72,191 | |||||||||||
Balance (in shares) at Dec. 31, 2019 | 54,205,852 | 40,000 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flow - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash flows from operating activities: | |||
Net loss | $ (49,451) | $ 31,851 | $ (113,483) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Change in fair value of warrant liability | (11,386) | (16,337) | 30,218 |
Impairment of intangible asset | 20,723 | ||
Stock-based compensation | 8,597 | 7,807 | 5,167 |
Amortization of intangible assets | 5,022 | 7,187 | 5,022 |
Accretion of discounts on marketable securities | (385) | ||
Interest and related guarantee fees paid in kind | 896 | ||
Amortization of debt discounts and debt issuance costs | 1,484 | 482 | |
Loss on extinguishment of debt | 21,549 | 3,545 | |
Gain on sale of subsidiary | (130,832) | ||
Deferred income tax expense | 1,958 | ||
Depreciation | 77 | 46 | 10 |
Changes in operating assets and liabilities: | |||
Accounts receivable | (663) | (42) | (1,584) |
Inventory | 1,618 | (3,437) | (511) |
Prepaid expenses and other current assets | 3,079 | (3,028) | (444) |
Other assets | (798) | 381 | (536) |
Accounts payable | 2,153 | (63) | 158 |
Accrued and other liabilities | (2,647) | (1,142) | 3,043 |
Net cash used in operating activities | (44,784) | (84,576) | (45,336) |
Cash flows from investing activities: | |||
Payment for acquisitions | (24,655) | (7,500) | |
Purchases of property and equipment | (74) | (326) | |
Purchases of marketable securities | (56,187) | ||
Sales and maturities of marketable securities | 35,500 | ||
Proceeds from sale of subsidiary | 159,311 | ||
Net cash (used in) provided by investing activities | (20,761) | 134,330 | (7,500) |
Cash flows from financing activities: | |||
Proceeds from long-term debt, net | 44,930 | 39,987 | |
Payment for loss on extinguishment of debt | (9,990) | (1,300) | |
Repayment of long-term debt | (85,000) | (22,261) | |
Proceeds from issuance of ordinary shares, net | 33,508 | 26,384 | |
Proceeds from share subscription to Novo | 22,383 | ||
Proceeds from issuance of ordinary shares in connection with at-the-market offering | 8,596 | 73 | |
Proceeds from exercise of warrants | 1,176 | ||
Proceeds from exercise of stock options | 179 | 96 | 626 |
Payments related to tax withholding for net-share settled equity awards | (92) | (473) | |
Net cash provided by financing activities | 87 | 15,226 | 43,509 |
Net (decrease) increase in cash and cash equivalents | (65,458) | 64,980 | (9,327) |
Cash and cash equivalents—beginning of period | 122,490 | 57,510 | 66,837 |
Cash and cash equivalents—end of period | 57,032 | 122,490 | 57,510 |
Supplemental disclosures of cash flow information: Cash paid during the year for: | |||
Interest | 11,122 | 2,935 | |
Income taxes other, net of refunds | 419 | 1 | $ 127 |
Supplemental non-cash financing activities: | |||
Issuance of shares to settle debt | $ 2,805 | ||
Changes in unrealized gain on marketable securities | $ 3 |
Organization
Organization | 12 Months Ended |
Dec. 31, 2019 | |
Organization | |
Organization | 1. Organization We are a global, commercial-stage biopharmaceutical company focused on the development and commercialization of therapies for rare diseases with significant unmet needs. Our first commercial product is Keveyis (dichlorphenamide), the first and only treatment approved by the U.S. Food and Drug Administration (the “FDA”) for hyperkalemic, hypokalemic, and related variants of primary periodic paralysis (“PPP”), a group of rare hereditary disorders that cause episodes of muscle weakness or paralysis. W e have two clinical-stage product candidates for rare endocrine diseases, Recorlev and veldoreotide. Recorlev (levoketoconazole) is a cortisol synthesis inhibitor currently being studied for the treatment of endogenous Cushing's syndrome. Veldoreotide is a next-generation somatostatin analog being investigated for potential applications in conditions amenable to somatostatin receptor activation. Both Recorlev and veldoreotide have received orphan designation from the FDA and the European Medicines Agency (“EMA”). In January 2018, Strongbridge Ireland Limited., one of our wholly-owned subsidiaries, acquired the U.S. and Canadian rights to Macrilen (macimorelin), the first and only oral drug approved by the FDA for the diagnosis of patients with adult growth hormone deficiency. We launched Macrilen in the United States in July 2018. In December 2018, we sold Strongbridge Ireland Limited. to Novo Nordisk Healthcare AG (“Novo”) for $145 million plus the right to receive tiered royalties on net sales of Macrilen through 2027. In addition, Strongbridge U.S. Inc, another of our wholly-owned subsidiaries, entered into an agreement with Novo Nordisk Inc., subsidiary of Novo (“NNI”), pursuant to which NNI funded the costs of 23 of our field-based employees to provide full-time ongoing services to NNI, including the promotion of Macrilen in the United States, for a period of three years. Novo also purchased 5.2 million of our ordinary shares at a purchase price of $7.00 per share. In December, 2019, we reached an agreement with Novo to terminate the services agreement. We received a $6 million payment in connection with such termination and we no longer provide services to Novo. Liquidity We believe that our cash, cash equivalents and marketable securities of $78.1 million at December 31, 2019 will be sufficient to allow us to fund planned operations for at least 12 months beyond the issuance date of these consolidated financial statements. We may never achieve profitability, and unless and until we do, we will continue to need to raise additional capital. We plan to continue to fund our operations and capital funding needs through equity or debt financing along with revenues from Keveyis. There can be no assurances, however, that additional funding will be available on terms acceptable to us. |
Summary of significant accounti
Summary of significant accounting policies and basis of presentation | 12 Months Ended |
Dec. 31, 2019 | |
Summary of significant accounting policies and basis of presentation | |
Summary of significant accounting policies and basis of presentation | 2. Summary of significant accounting policies and basis of presentation Basis of presentation and principles of consolidation The accompanying consolidated financial statements include the accounts of our wholly owned subsidiaries, Strongbridge U.S. Inc. (Trevose, Pennsylvania, United States), Strongbridge Dublin Limited (Dublin, Ireland), Cortendo AB (Gothenburg, Sweden) and Cortendo Cayman (Georgetown, Cayman Islands). All intercompany balances and transactions have been eliminated in consolidation. These audited consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States (“U.S. GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative U.S. GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the FASB. Revenue recognition We follow ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”) , effective for revenue accounting. Topic 606 applies to all contracts with customers, except for contracts that are within the scope of other standards, such as leases, insurance, collaboration arrangements and financial instruments. Under Topic 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of Topic 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. We apply the five-step model to contracts only when it is probable that we will collect the consideration we are entitled to receive in exchange for the goods or services we transfer to the customer. At contract inception, once the contract is determined to be within the scope of Topic 606, we assess the goods or services promised within each contract, determine those that are performance obligations, and assess whether each promised good or service is distinct. We then recognize as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. For a complete discussion of accounting for net product revenue, see Note 3. Inventory and cost of sales Inventory is stated at the lower of cost or net realizable value where cost is determined using the first-in, first-out method. Cost of sales includes the cost of inventory sold, which includes third-party acquisition costs, third-party warehousing and product distribution charges. Leases We account for leases in accordance with Accounting Standards Codification Topic 842, Leases , (“ASC 842”). We determine if an arrangement is a lease at contract inception. A lease exists when a contract conveys to us the right to control the use of identified property, plant, or equipment for a period of time in exchange for consideration. The definition of a lease embodies two conditions: (1) there is an identified asset in the contract that is land or a depreciable asset ( i.e. , property, plant, and equipment), and (2) we have the right to control the use of the identified asset. Operating leases where we are the lessee are included in Right of use (“ROU”) assets and Other current liabilities and Other long-term liabilities on our Consolidated Balance Sheets. The lease liabilities are initially and subsequently measured at the present value of the unpaid lease payments at the lease commencement date. Key estimates and judgments include how we determined (1) the discount rate we use to discount the unpaid lease payments to present value, (2) lease term and (3) lease payments. ASC 842 requires a lessee to discount its unpaid lease payments using the interest rate implicit in the lease or, if that rate cannot be readily determined, its incremental borrowing rate. Because our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Our incremental borrowing rate for a lease is the rate of interest we would have to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms. The lease term for all of our leases includes the noncancellable period of the lease. Lease payments included in the measurement of the lease asset or liability are comprised of our fixed payments. The ROU asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for lease payments made at or before the lease commencement date less any lease incentives received. For operating leases, the ROU asset is subsequently measured throughout the lease term at the carrying amount of the lease liability, plus (minus) any prepaid (accrued) lease payments, less the unamortized balance of lease incentives received. Lease expense for lease payments is recognized on a straight-line basis over the lease term. We monitor for events or changes in circumstances that require a reassessment of a lease. If a reassessment results in the remeasurement of a lease liability, a corresponding adjustment is made to the carrying amount of the corresponding ROU asset unless doing so would reduce the carrying amount of the ROU asset to an amount less than zero. In that case, the amount of the adjustment that would result in a negative ROU asset balance is recorded in profit or loss. We have elected not to recognize ROU assets and lease liabilities for all short-term leases that have a lease term of 12 months or less. We recognize the lease payments associated with our short-term leases as an expense on a straight-line basis over the lease term. Variable lease payments associated with these leases are recognized and presented in the same manner as for all our other leases. We adopted ASC 842 using a modified retrospective transition approach as of the effective date, as permitted by the amendments in ASU 2018-11. As a result, we were not required to adjust our comparative period financial information for effects of the standard or make the new required lease disclosures for periods before the date of adoption ( i.e., January 1, 2019). We have elected to adopt the package of transition practical expedients and, therefore, have not reassessed (1) whether existing or expired contracts contain a lease, (2) lease classification for existing or expired leases or (3) the accounting for initial direct costs that were previously capitalized. We did not elect the practical expedient to use hindsight for leases existing at the adoption date. Further, we do not expect the amendments in ASU 2018-01: Land Easement Practical Expedient to have an effect on us because we do not enter into land easement arrangements. Income and Expense from Field Services Agreement In connection with our sale of our subsidiary, Strongbridge Ireland Limited, which owned the rights to Macrilen to Novo, Strongbridge U.S. Inc, one of our wholly-owned subsidiaries, entered into a field services agreement with Novo Nordisk Inc., a subsidiary of Novo (“NNI”), pursuant to which NNI agreed to fund the costs of 23 of our field-based employees to provide full-time ongoing services to NNI, including the promotion of Macrilen in the United States. This agreement was terminated effective December 1, 2019. Our income and expense under the field services agreement are recorded as non-operating income and expense, respectively. Use of estimates The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the reported amounts in the financial statements and accompanying notes. We must apply significant judgment in this process. Actual results could materially differ from those estimates. Cash, cash equivalents and marketable securities We consider all short‑term highly liquid investments with an original maturity at the date of purchase of three months or less to be cash equivalents. Cash and cash equivalents consist of account balances at banks and money market accounts, respectively. We invest our excess cash balances in marketable securities of highly rated financial institutions. We seek to diversify our investments and limit the amount of investment concentrations for individual institutions, maturities and investment types. We classify marketable debt securities as available-for-sale and, accordingly, record such securities at fair value. We classify these securities as current assets as these investments are intended to be available to us for use in funding current operations. T here were no marketable securities with a maturity of greater than one year as of December 31, 2019. Unrealized gains and losses on marketable debt securities are recorded as a separate component of accumulated other comprehensive income (loss) included in stockholders’ equity. Concentration of credit risk and other risks and uncertainties As part of our cash and investment management processes, we perform periodic evaluations of the credit standing of the financial institutions with which we deposit our cash or purchase cash equivalents or marketable securities, and we have not sustained any credit losses from instruments held at these financial institutions. Fair value of financial instruments Fair value accounting is applied for all financial assets and liabilities and non‑financial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually). We are required to disclose information on all assets and liabilities reported at fair value that enables an assessment of the inputs used in determining the reported fair values. FASB ASC Topic 820, Fair Value Measurements and Disclosures (“ASC 820”), establishes a hierarchy of inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of us. Unobservable inputs are inputs that reflect our assumptions about the inputs that market participants would use in pricing the asset or liability and are developed based on the best information available in the circumstances. The fair value hierarchy applies only to the valuation inputs used in determining the reported fair value of the investments and is not a measure of the investment credit quality. The three levels of the fair value hierarchy are described as follows: Level 1—Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that we have the ability to access at the measurement date. Level 2—Valuations based on quoted prices for similar assets or liabilities, or quoted prices in markets that are not active, and for which all significant inputs are observable, either directly or indirectly. Level 3—Valuations that require inputs that reflect our own assumptions that are both significant to the fair value measurement and unobservable. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment we exercise in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. In December 2016, we issued warrants in connection with our private placement of ordinary shares. Pursuant to the terms of the warrant agreement, we could be required to settle the warrants in cash in the event of an acquisition of the Company and, as a result, the warrants are required to be measured at fair value and reported as a liability in the consolidated balance sheet. We recorded the fair value of the warrants upon issuance using the Black-Scholes Model and are required to revalue the warrants at each reporting date with any changes in fair value recorded on our statement of operations. The valuation of the warrants is considered under Level 3 of the fair value hierarchy due to the need to use assumptions in the valuation that that are both significant to the fair value measurement and unobservable. The change in the fair value of the Level 3 warrant liabilities is reflected in the statement of operations for the years ended December 31, 2019, 2018 and 2017. Property and equipment, net Property and equipment, net, consists of office equipment such as furniture, fixtures and computers. Depreciation expense for the years ended December 31, 2019 and 2018, was not significant. The following useful lives were used for the various classifications of property and equipment, net: Amortization Periods Computer hardware - years Computer software - years Furniture and fixtures - years Leasehold improvements Lesser of useful life or remaining lease term Intangible assets Certain intangible assets were acquired as part of an asset purchase and have been capitalized at their acquisition date fair value. Acquired definite life intangible assets are amortized using the straight-line method over their respective estimated useful lives. We evaluate the potential impairment of intangible assets if events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable or that the useful lives of these assets are no longer appropriate. Goodwill We test goodwill for impairment on an annual basis or whenever events occur that may indicate possible impairment. This analysis requires us to make a series of critical assumptions to (1) evaluate whether any impairment exists and (2) measure the amount of impairment. Because we have one operating segment, when testing for a potential impairment of goodwill, we are required to estimate the fair value of our business and determine the carrying value. If the estimated fair value is less than the carrying value of our business, then we are required to estimate the fair value of all identifiable assets and liabilities in a manner similar to a purchase price allocation for an acquired business. Only after this process is completed can the goodwill impairment be determined, if any. To estimate the fair value of the business, primarily a market‑based approach is applied, utilizing our public market value. We did not record a charge for impairment for our goodwill for the years ended December 31, 2019, 2018, and 2017. Stock‑based compensation We account for stock‑based compensation awards in accordance with Financial Accounting Standards Board (“FASB”) ASC Topic 718, Compensation—Stock Compensation (“ASC 718”). ASC 718 requires all stock‑based payments including grants of stock options and restricted stock and modifications to existing stock options, to be recognized in the consolidated statements of operations based on their fair values. We record compensation expense for service-based awards over the vesting period of the award on a straight-line basis. Compensation expense related to awards with performance-based vesting conditions is recognized over the requisite service period using the accelerated attribution method to the extent achievement of the performance condition is probable. We estimate the fair value of our awards with service conditions using the Black‑Scholes option pricing model, which requires the input of subjective assumptions, including (i) the expected stock price volatility, (ii) the expected term of the award, (iii) the risk‑free interest rate and (iv) expected dividends. We have estimated the expected term of employee service-based stock options using the “simplified” method, whereby the expected term equals the arithmetic average of the vesting term and the original contractual term of the option, due to our lack of sufficient historical data. The risk-free interest rates for periods within the expected term of the option are based on the U.S. Treasury Bond rate with a maturity date commensurate with the expected term of the associated award. We have never paid dividends and do not expect to pay dividends in the foreseeable future. We account for forfeitures as they occur as opposed to estimating forfeitures. We record stock-based compensation expense only for those awards that are expected to vest. Income taxes On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act makes broad and complex changes to the U.S. tax code, including, but not limited to, reducing the top U.S. federal corporate tax rate from 35 percent to 21 percent; requiring companies to pay a one-time transition tax on certain un-repatriated earnings of foreign subsidiaries; generally eliminating U.S. federal income taxes on dividends from foreign subsidiaries; requiring a current inclusion in U.S. federal taxable income of certain earnings of controlled foreign corporations; eliminating the corporate alternative minimum tax (“AMT”) and changing how existing AMT credits can be realized; creating the base erosion anti-abuse tax (“BEAT”), a new minimum tax; creating a new limitation on deductible interest expense; and changing rules related to uses and limitations of net operating loss carryforwards created in tax years beginning after December 31, 2017. The Tax Act reduces our U.S. corporate income tax rate from 34% to 21%, effective January 1, 2018. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. As a result of the reduction in the U.S. corporate income tax rate from 34% to 21% under the Tax Act, we revalued our ending net deferred tax assets and liabilities at December 31, 2017. We recognize interest and penalties related to uncertain tax positions in income tax expense. As of December 31, 2019, 2018 and 2017, we had no accrued interest or penalties related to uncertain tax positions and no amounts have been recognized in our statements of operations. Net (loss) income per share Basic net (loss) income per share is calculated by dividing the net (loss) income attributable to shareholders by the weighted-average number of ordinary shares outstanding during the period. Diluted net (loss) income per share is calculated by dividing the net (loss) income attributable to shareholders by the weighted‑average number of ordinary shares outstanding for the period, including any dilutive effect from outstanding stock options and other equity-based awards. Net (loss) income per share was calculated as follows for the periods indicated below: Year Ended December 31, (in thousands, except per share data) 2019 2018 2017 Basic Net (Loss) Income Per Share Basic net (loss) income $ (49,451) $ 31,851 $ (113,483) Unrealized gain on fair value of warrants $ 11,386 $ 16,337 $ - Diluted net (loss) income $ (60,837) $ 15,514 $ (113,483) Weighted-average ordinary shares outstanding 54,182,499 46,297,088 36,544,825 Basic net (loss) income per share $ (0.91) $ 0.69 $ (3.11) Diluted Net (Loss) Income Per Share Diluted net (loss) income $ (60,837) $ 15,514 $ (113,483) Weighted-average ordinary shares outstanding 54,182,499 46,297,088 36,544,825 Dilutive warrants, stock options and RSUs 1,200,531 3,427,415 - Weighted-average shares used to compute diluted net income (loss) per share 55,383,030 49,724,503 36,544,825 Diluted net (loss) income per share $ (1.10) $ 0.31 $ (3.11) Shares used in the diluted net loss per share calculations exclude anti‑dilutive ordinary share equivalents, which consist of outstanding stock options, unvested restricted stock units and warrants, if applicable. December 31, 2019 2018 2017 Warrants 1,803,253 1,642,539 7,555,003 Stock options issued and outstanding 9,192,684 4,444,830 6,104,715 Unvested RSUs 791,350 — 267,250 Recently issued accounting pronouncements In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other: Simplifying the Accounting for Goodwill Impairment. ASU 2017-04 removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. This standard, which will be effective for us beginning in the first quarter of fiscal year 2020, is required to be applied prospectively. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. We do not expect the adoption of this standard to have a significant impact on our financial statements or internal controls. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments . ASU 2016-13 requires an entity to measure and recognize expected credit losses for certain financial instruments, including trade receivables, as an allowance that reflects the entity's current estimate of credit losses expected to be incurred. For available-for-sale debt securities with unrealized losses, the standard requires allowances to be recorded through net income instead of directly reducing the amortized cost of the investment under the current other-than-temporary impairment model. The standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019, with early adoption permitted. We do not expect the adoption of this standard to have a significant impact on our financial statements or internal controls. |
Revenue recognition
Revenue recognition | 12 Months Ended |
Dec. 31, 2019 | |
Revenue recognition | |
Revenue recognition | 3. Revenue recognition Product revenue, net We sell Keveyis to one specialty pharmacy provider (the “Customer”), who is the exclusive distributor of Keveyis in the United States. The Customer subsequently resells Keveyis to patients, most of whom are covered by payors that may provide for government-mandated or privately negotiated rebates with respect to the purchase of Keveyis. Revenues from sales of Keveyis are recognized when we satisfy a performance obligation by transferring control of the product to the Customer. Transfer of control occurs upon receipt of the product by the Customer. We expense incremental costs related to the set-up of contracts with the Customer when incurred, as these costs do not meet the criteria for capitalization. Disaggregation of Revenue The following table summarizes revenue by product for the twelve months ended December 31, 2019 and 2018 (in thousands): Year Ended Year Ended Year Ended December 31, 2019 December 31, 2018 December 31, 2017 Products Keveyis $ 21,676 $ 16,802 $ 7,046 Macrilen — 1,225 — Total $ 21,676 $ 18,027 $ 7,046 Reserves for variable consideration Revenues from sales of Keveyis are recorded at the net sales price (transaction price), which includes estimates of variable consideration for which reserves are established and that result from rebates, co-pay assistance and other allowances that are offered between us and the patients’ payors. There is no variable consideration reserve for returns as we do not accept returns of Keveyis. These reserves are based on the amounts earned or to be claimed on the related sales and are classified as reductions of accounts receivable (if the amount is payable to the Customer) or a current liability (if the amount is payable to a party other than the Customer). Where appropriate, these estimates may take into consideration a range of possible outcomes that are probability-weighted for relevant factors such as our historical experience, current contractual and statutory requirements, specific known market events and trends, industry data and forecasted customer buying and payment patterns. Overall, these reserves reflect our best estimates of the amount of consideration to which we are entitled based on the terms of the contract. The amount of variable consideration that is included in the transaction price may be constrained, and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from our estimates. We reassess our estimates on an ongoing basis. If actual results in the future vary from our estimates, we will adjust our estimates. Any such adjustments would affect net product revenue and earnings in the period such variances become known. Trade discount : We provide the Customer with a discount that is explicitly stated in our contract and is recorded as a reduction of revenue in the period the related product revenue is recognized. In addition, we receive sales order management, data and distribution services from the Customer. To the extent the services received are distinct from our sale of Keveyis to the Customer, these payments are classified in selling, general and administrative expenses in our consolidated statement of operations and comprehensive (loss) income. Funded Co-pay Assistance Program : We contract with a third-party to manage the co-pay assistance program intended to provide financial assistance to qualified insured patients. The calculation of the accrual for co-pay assistance is based on an estimate of claims and the cost per claim that we expect to receive associated with Keveyis that has been recognized as revenue, but remains in the distribution channel inventories at the end of each reporting period. These payments are consideration payable to the Customer and the related reserve is recorded in the same period the related revenue is recognized, resulting in a reduction of product revenue and the establishment of a current liability which is included in accrued expenses on the consolidated balance sheet. Government rebates : We are subject to discount obligations under state Medicaid programs and Medicare. We estimate our Medicaid and Medicare rebates for the estimated patient mix. These reserves are recorded in the same period the related revenue is recognized, resulting in a reduction of product revenue and the establishment of a current liability, which is included in accrued expenses on the consolidated balance sheet. For Medicaid, accruals are based on estimates of future Medicaid beneficiary utilization applied to the Medicaid unit rebate formula established by the Center for Medicaid and Medicare Services. Effective January 1, 2019, manufacturers of pharmaceutical products are responsible for 70% of the patient’s cost of branded prescription drugs related to the Medicare Part D Coverage Gap. In order to estimate the cost to us of this Medicare coverage gap responsibility, we estimate the number of patients in the prescription drug coverage gap for whom we will owe an additional liability under the Medicare Part D program. Our liability for these rebates consists of estimates of claims for the current quarter and estimated future claims that will be made for Keveyis that have been recognized as revenue, but remains in the distribution channel inventories at the end of each reporting period. Temporary Supply and Patient Assistance Programs : We provide free Keveyis to uninsured patients who satisfy pre-established criteria for either the Temporary Supply Program or the Patient Assistance Program. Patients who meet the Temporary Supply Program eligibility criteria may receive a temporary supply of free Keveyis for no more than sixty days while there is a determination of the patient’s third-party insurance, prescription drug benefit or other third-party coverage for Keveyis. The Patient Assistance Program provides free Keveyis for up to twelve months to uninsured patients who satisfy pre-established criteria for financial need. We do not recognize any revenue related to these free products and the associated costs are classified in selling, general and administrative expenses in our consolidated statements of operations and comprehensive (loss) income. |
Fair value measurement
Fair value measurement | 12 Months Ended |
Dec. 31, 2019 | |
Fair value measurement | |
Fair value measurement | 4. Fair value measurement The following table sets forth the fair value measurements by level within the fair value hierarchy, that are measured on a recurring basis. Our l evel 3 instrument consist of the ordinary share warrant liability. The fair values of the outstanding warrants were measured using the Black-Scholes option-pricing model. Inputs used to determine estimated fair value of the warrant liabilities include the estimated fair value of the underlying stock at the valuation date, the estimated term of the warrants, risk-free interest rates, expected dividends and the expected volatility of the underlying stock. The significant unobservable inputs used in the fair value measurement of the warrant liabilities were the volatility rate and the estimated term of the warrants. Generally, increases (decreases) in the fair value of the underlying stock and estimated term would result in a directionally similar impact to the fair value measurement. The following table presents our assets and liabilities that are measured at fair value on a recurring basis for the periods presented (in thousands) : As of December 31, 2019 Level I Level II Level III Total Cash equivalents 56,544 — — 56,544 Marketable securities — 21,072 — 21,072 Total assets $ 56,544 $ $ — $ 77,616 Warrant liability — — 4,127 4,127 Total liabilities $ — $ — $ 4,127 $ 4,127 As of December 31, 2018 Level I Level II Level III Total Cash equivalents 122,300 — — 122,300 Total assets $ 122,300 $ — $ — $ 122,300 Warrant liability — — 15,513 15,513 Total liabilities $ — $ — $ 15,513 $ 15,513 The following table presents a reconciliation of our level 3 Warrant liability (in thousands): As of December 31, 2019 Balance as of December 31, 2018 $ 15,513 Unrealized gain on fair value of warrants for the year ended December 31, 2019 (11,386) Balance as of December 31, 2019 $ 4,127 |
Intangible assets and goodwill
Intangible assets and goodwill | 12 Months Ended |
Dec. 31, 2019 | |
Intangible assets and goodwill | |
Intangible assets and goodwill | 5. Intangible assets and goodwill The gross carrying amount of in‑process research and development, acquired developed product rights and goodwill is as follows (in thousands): As of December 31, 2019 Beginning of Period Additions Sold Amortization End of Period Keveyis $ 30,132 $ — $ — $ (5,022) $ 25,110 Goodwill 7,256 — — — 7,256 Total $ 37,388 $ — $ — $ (5,022) $ 32,366 As of December 31, 2018 Beginning of Period Additions Sold Amortization End of Period Keveyis $ 35,155 $ — $ — $ (5,023) $ 30,132 Macrilen — 24,834 (22,670) (2,164) — Goodwill 7,256 — — — 7,256 Total $ 42,411 $ 24,834 $ (22,670) $ (7,187) $ 37,388 Estimated amortization of our acquired developed product rights intangible asset for the five years subsequent to December 31, 2019 is as follows (in thousands): 2020 $ 5,022 2021 5,022 2022 5,022 2023 5,022 2024 5,022 Our finite-lived intangible asset consists of acquired developed product rights obtained from our acquisition of U.S. marketing rights to Keveyis (dichlorphenamide) from a subsidiary of Taro Pharmaceutical Industries Ltd. (“Taro”). Pursuant to the terms of the Asset Purchase Agreement and Supply Agreement that we entered into with Taro in December 2016, we paid Taro an upfront payment in two installments of $1 million in December 2016 and $7.5 million in March 2017. We concluded that the supply price payable by us exceeds fair value and, therefore, used a discounted cash flow method with a probability assumption to value the payments in excess of fair value at $29.3 million, for which we have recorded an intangible asset and corresponding liability. This liability is being reduced as we purchase inventory over the term of the Supply Agreement that we entered into with Taro in December 2016. In addition, we incurred transaction costs of $2.4 million. The transaction resulted in the recording of an intangible asset of $40.2 million. This asset is being amortized over an eight-year period using the straight-line method. |
Marketable securities
Marketable securities | 12 Months Ended |
Dec. 31, 2019 | |
Marketable securities | |
Marketable securities | 6. Marketable securities Marketable securities consist of the following: As of December 31, 2019 Amortized Cost Net Unrealized Gain Fair Value Commercial Paper $ 11,889 $ — $ 11,889 U.S. treasury securities 2,982 — 2,982 Asset-backed securities 6,198 3 6,201 Total marketable securities $ 21,069 $ 3 $ 21,072 |
Accrued liabilities
Accrued liabilities | 12 Months Ended |
Dec. 31, 2019 | |
Accrued liabilities | |
Accrued liabilities | 7. Accrued liabilities Accrued liabilities consist of the following (in thousands): December 31, December 31, 2019 2018 Employee compensation $ 4,452 $ 5,717 Consulting and professional fees 4,335 4,145 Accrued sales allowances 2,990 2,233 Severance 2,968 — Supply agreement - current portion 2,773 1,638 Accrued taxes 1,892 535 Accrued royalties 806 802 Lease liability - current portion 374 — Other 372 995 Total accrued liabilities $ 20,962 $ 16,065 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases | |
Leases | 8. Leases We lease office space under operating leases. Our leases have initial lease terms ranging from one to five years. Our lease agreements contain provisions for future rent increases. As of December 31, 2019, future minimum commitments under facility operating leases were as follows (in thousands): Operating leases 2020 470 2021 481 2022 492 2023 207 Total minimum lease payments $ 1,650 The components of lease cost for the quarter ended December 31, 2019 are as follows (in thousands): Year Ended December 31, 2019 Lease costs Amortization of right of use assets $ 335 Interest on lease liabilities 122 Total lease cost $ 457 Amounts reported in the Consolidated Balance Sheet for leases where we are the lessee as of December 31, 2019 were as follows (in thousands): December 31, 2019 Operating Leases Right of use asset $ 789 Lease liability $ 1,080 Remaining lease term Operating leases 3 years 5 months Discount rate Operating leases |
Warrants
Warrants | 12 Months Ended |
Dec. 31, 2019 | |
Warrants | |
Warrants | 9. Warrants Ordinary share warrants are accounted for in accordance with applicable accounting guidance provided in ASC Topic 815 , Derivatives and Hedging — Contracts in Entity’s Own Equity (“ASC Topic 815”), as either derivative liabilities or as equity instruments depending on the specific terms of the warrant agreement. Warrants outstanding and warrant activity for the year ended December 31, 2019 is as follows: Warrants Outstanding Exercise Expiration Warrants Warrants December 31, Classification Price Date Issued Exercised 2019 Warrants in connection with private equity placement Liability $ 2.50 6/28/2022 7,000,000 (1,970,000) 5,030,000 Warrants in connection with Horizon and Oxford loan agreement Equity $ 2.45 12/28/2026 428,571 (267,857) 160,714 Warrants in connection with CRG loan agreement Equity $ 7.37 7/14/2024 394,289 — 394,289 Warrants in connection with CRG loan amendment in January 2018 Equity $ 10.00 1/16/2025 1,248,250 — 1,248,250 9,071,110 6,833,253 |
Commitments and contingencies
Commitments and contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and contingencies | |
Commitments and contingencies | 10. Commitments and contingencies (a) Commitments to Taro Pharmaceuticals Industries Ltd. In December 2016, we acquired the U.S. marketing rights to Keveyis (dichlorphenamide) from Taro. Under the terms of an Asset Purchase Agreement, we paid Taro an upfront payment in two installments of $1 million in December 2016 and $7.5 million in March 2017, and will pay an aggregate of $7.5 million in potential milestones upon the achievement of certain product sales targets. Taro has agreed to continue to manufacture Keveyis for us under an exclusive supply agreement through the orphan exclusivity period. We are obligated to purchase certain annual minimum amounts of product totaling approximately $29 million over a six-year period. As of December 31, 2019, our remaining obligation was $19.0 million. Our Supply Agreement with Taro may extend beyond the orphan exclusivity period unless terminated by either party pursuant to the terms of the agreement. If terminated by Taro at the conclusion of the orphan exclusivity period, we have the right to manufacture the product on our own or have the product manufactured by a third party on our behalf. We are also required to reimburse Taro for their royalty obligation resulting from their sale of Keveyis to us. (b) Indemnifications In the ordinary course of business and in connection with the sale of assets and businesses and other transactions, we often indemnify our counterparties against certain liabilities that may arise in connection with the transaction or that are related to events and activities prior to or following a transaction, such as breaches of contracts, unfavorable tax consequences and employee liabilities. If the indemnified party were to make a successful claim pursuant to the terms of the indemnification, we may be required to reimburse the loss and such amount could be material to our financial statements. Where appropriate, the obligation for such indemnifications is recorded as a liability. Because the amount of these types of indemnifications generally is not specifically stated, the overall maximum amount of the obligation under such indemnifications cannot be reasonably estimated. However, we believe that the likelihood of a material liability being triggered under these indemnification obligations is not probable at this time. |
Defined contribution plan
Defined contribution plan | 12 Months Ended |
Dec. 31, 2019 | |
Defined contribution plan | |
Defined Contribution Plan | 11. Defined contribution plan Our 401(k) Employee Savings Plan (“401(k) Plan”) is available to all employees. We have elected a Safe-Harbor provision for the 401(k) Plan in which participants are always fully vested in their employer contributions. We match 100% of the first 4% of participating employee contributions. Our contributions were approximately $818,000, $704,000 and $173,000 for the years ended December 31, 2019, 2018 and 2017, respectively. Our contributions are made in cash. Our ordinary shares are not an investment option available to participants in the 401(k) Plan. |
Income taxes
Income taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income taxes | |
Income taxes | 12. Income taxes For the years ended December 31, 2019, 2018 and 2017, the components of income (loss) before income taxes were as follows (in thousands): Year Ended December 31, 2019 2018 2017 Sweden $ (1,989) $ 4,712 $ (19,249) Ireland (23,708) 73,409 (47,211) Cayman Islands (1,587) (701) (21,709) U.S. (20,399) (45,033) (23,543) Total $ (47,683) $ 32,387 $ (111,712) The components of income tax expense (benefit) for the years ended December 31, 2019, 2018 and 2017 were as follows (in thousands): Year Ended December 31, 2019 2018 2017 Current tax (benefit) expense: Sweden $ 1,767 $ 535 $ — Ireland — — (22) U.S. Federal — — (151) State 1 1 (14) Total current tax expense (benefit) $ 1,768 $ 536 $ (187) Deferred tax expense (benefit): Sweden $ — $ 12,395 $ (4,586) Ireland (8,484) (13,337) 1,280 U.S. Federal (7,914) (1,785) 39 State (784) (354) (2,392) Change in valuation allowance 17,182 3,081 7,617 Total deferred tax expense (benefit) — — 1,958 Total tax expense (benefit) $ 1,768 $ 536 $ 1,771 With the exception of Sweden, we have net operating loss carryforwards in all other countries. For the Ireland and United States operations, we have not reflected any benefit of net operating loss carryforwards (“NOLs”) in the accompanying financial statements. In 2017, Strongbridge U.S. Inc. generated book loss as we decided this entity will markets and commercializes certain products. As such, given the high level of expenses incurred, it is not more likely than not we will recognize all deferred tax assets which results in us establishing a full valuation allowance against its deferred tax assets. During 2018, we transferred all our intercompany intellectual property to Ireland , resulting in current taxes due in Sweden after the utilization of all NOLs in Sweden, which previously had a full valuation allowance, and the creation of amortizable deferred tax assets in Ireland, which have a full valuation allowance. We recorded income tax expense of $1.8 million for the year ended December 31, 2019 arising from intercompany interest income. Deferred taxes are recognized for temporary differences between the bases of assets and liabilities for financial statement and income tax purposes. The tax effect of temporary differences that give rise to significant portions of the deferred tax assets are as follows (in thousands): Year Ended December 31, 2019 2018 Deferred tax assets: Net operating loss carryforwards $ 16,283 $ 4,932 Stock-based compensation 6,811 4,944 Lease Liability 404 107 Intangible Amortization 628 Other deferred activity 250 497 Tax credits 14,533 10,826 Interest disallowance 9,687 9,889 Intangibles 13,240 13,240 Total deferred tax assets 61,836 44,435 Valuation allowance (61,617) (44,435) Deferred tax assets recognized 219 — Deferred tax liabilities: Lease Liability - Right of Use (219) — Total deferred tax liabilities (219) — Net deferred tax assets (liabilities) $ — $ — We have evaluated the positive and negative evidence bearing upon the realizability of our deferred tax assets. Based on our history of operating losses, aside from the gain associated with the sale of our subsidiary, we have concluded that it is more likely than not that the benefit of our deferred tax assets will not be realized. The valuation allowance increased by approximately $17.2 million and $2.7 million during the years ended December 31, 2019 and 2018, respectively, due primarily to net operating losses. Our effective income tax rate differs from the ultimate parent company, Strongbridge Biopharma plc, Irish domestic statutory rate of 12.5% for the year ended December 31, 2019, 2018 and 2017. Year Ended December 31, 2019 2018 2017 Ireland statutory income tax rate 12.50 % 12.50 % 12.50 % Foreign tax differential between Sweden, U.S., Cayman Island and Ireland 1.39 7.55 3.99 Federal tax credits 7.77 (4.58) — Change in valuation allowance (36.04) 9.51 (6.82) State income taxes 1.64 (1.09) 1.43 Permanent differences 2.92 4.01 (5.04) Rate change - tax impact — — (7.09) Foreign exchange remeasurement of Swedish deferred tax asset — — 0.83 Provision to return 0.53 3.95 (1.33) Sale of subsidiary — (37.58) — Net operating loss adjustment 5.57 7.72 — Other — (0.34) (0.06) Effective income tax rate (3.72) % 1.65 % (1.59) % At December 31, 2019, we have no Swedish NOLs and approximately $60.2 million of Irish NOLs, which have an indefinite life, and approximately $27.0 million of U.S. federal and $29.1 million of state NOLs, which begin to expire in 2031. Due to recent tax reform, federal U.S. net operating losses generated after January 1, 2018 now have an indefinite life. Through December 31, 2015, we operated through a permanent establishment in both Sweden and the United States. As a result of utilizing the Swedish NOLs, we have written off all attributes associated with the prior U.S. branch. At December 31, 2019, we had $14.3 million of U.S. federal orphan drug tax credit carryforwards, which begin to expire in 2032, and $0.2 million of U.S. federal research and development tax credit carryforwards, which begin to expire in 2031. Utilization of the NOLs may be subject to limitations under U.S. Internal Revenue Code Section 382 if there is a greater than 50% ownership change as determined under applicable regulations. We file income tax returns in Sweden, Ireland, the United States, and various states within the United States. In the normal course of business, we are subject to examination by federal, state and foreign jurisdictions, where applicable. Our tax years are still open under statute from inception to present. All open years may be examined to the extent that tax credit or net operating loss carryforwards are used in future periods. |
Ordinary shares
Ordinary shares | 12 Months Ended |
Dec. 31, 2019 | |
Ordinary shares. | |
Ordinary shares | 13. Ordinary shares Voting rights and privileges As of December 31, 2019, and December 31, 2018, there are 600,000,000 authorized ordinary shares and 54,205,852 and 54,122,074 outstanding ordinary shares, respectively. The holders of our ordinary shares are entitled to one vote for each ordinary share held at all meetings of shareholders without limitation and written actions in lieu of meetings. The holders are entitled to receive dividends if and when declared by our Board of Directors. No dividends have been declared or paid since our inception. The holders are entitled to share ratably in our assets available for distribution to stockholders, in the event of any voluntary or involuntary liquidation. In addition, on May 26, 2015 we issued 40,000 deferred shares with a €1.00 par value per share (US$1.098). The deferred shares are issued in order to satisfy an Irish legislative requirement to maintain a minimum level of issued share capital denominated in euro. The deferred shares carry no voting rights and are not entitled to any dividend or distribution. Equity financings On December 18, 2018, we sold 5,242,000 shares of our ordinary shares to Novo for $7.00 per share and an aggregate purchase price of $36.7 million. We accounted for the $14.3 million premium paid over the market price of our ordinary shares as additional gain on the sale of our subsidiary. On January 25, 2018, we sold 5,000,000 ordinary shares in a public offering at a price to the public of $6.75 per ordinary share for net proceeds of approximately $31.7 million, after deducting underwriting discounts and commissions and offering expenses paid by us. On February 26, 2018, we sold an additional 255,683 ordinary shares as part of our January 2018 public offering at a price of $6.75 per ordinary share for net proceeds of approximately $1.6 million, after deducting underwriting discounts and commissions and offering expenses paid by us. We entered into an equity distribution agreement with JMP Securities LLC (“JMP Securities”) on April 28, 2017, pursuant to which we may sell, at our option, from time to time, up to an aggregate of $40 million in ordinary shares of the Company through JMP Securities, as sales agent. We will pay JMP Securities a commission equal to 3% of the gross proceeds from the sale of ordinary shares under the ATM Facility. Pursuant to the terms of the equity distribution agreement, we reimbursed JMP Securities for certain out-of-pocket expenses, including the fees and disbursements of counsel to JMP Securities, incurred in connection with establishing the ATM Facility and have provided JMP Securities with customary indemnification rights. During the year ended December 31, 2018, we sold an aggregate of 1,281,903 ordinary shares under the ATM Facility for net proceeds of approximately $8.6 million and paid fees of $0.3 million to JMP Securities. As December 31, 2019, we have approximately $31.1 million available for sale under our ATM facility. Shares reserved for issuance There were 9,984,034 and 8,579,511 ordinary shares reserved for future issuance upon exercise of stock options and restricted stock vesting as of December 31, 2019 and 2018, respectively. As of December 31, 2019, we have 6,833,253 ordinary shares reserved for outstanding warrants. |
Stock-based compensation
Stock-based compensation | 12 Months Ended |
Dec. 31, 2019 | |
Stock-based compensation | |
Stock based compensation | 14. Stock‑based compensation Our board of directors has adopted the 2017 Inducement Plan (the “Inducement Plan”). The Inducement Plan provides for the grant of equity-based awards to new employees. The purpose of the Inducement Plan is to attract valued employees by offering them a greater stake in our success and a closer identity with us, and to encourage ownership of our ordinary shares by such employees. The Inducement Plan became effective on February 23, 2017. As of December 31, 2019, 1,099,776 ordinary shares are available for issuance pursuant to the Inducement Plan. Our board of directors has adopted, and our shareholders have approved, the 2015 Equity Compensation Plan (the “2015 Plan”). The 2015 Plan provides for the grant of incentive stock options to our employees and any parent or subsidiary corporation’s employees, and for the grant of nonstatutory stock options, stock awards, and RSUs to our employees, directors and consultants and our parent or subsidiary corporations’ employees and consultants. The 2015 Plan became effective on September 3, 2015. As of December 31, 2019, 725,531 ordinary shares are available for issuance pursuant to the 2015 Plan. Our board of directors has adopted, and our shareholders have approved, the Non‑Employee Director Equity Compensation Plan (the “Non‑Employee Director Plan”). The Non‑Employee Director Plan provides for the grant of nonstatutory stock options, stock awards, and RSUs to our non‑employee directors. The Non‑Employee Director Plan became effective on September 3, 2015. As of December 31, 2019, no ordinary shares are available for issuance pursuant to the Non‑Employee Director Plan. A summary of the outstanding stock options activity for the year ended December 31, 2019 is as follows: Options Outstanding Weighted- Average Weighted- Remaining Average Contractual Number of Exercise Term Aggregate Shares Price (Years) Intrinsic Value (in thousands) Outstanding—January 1, 2019 8,579,511 $ 7.35 7.57 $ 3,281 Granted 2,788,900 $ 3.85 Forfeited and cancelled (2,131,886) $ 5.20 Exercised (43,841) $ 4.12 Outstanding—December 31, 2019 9,192,684 $ 6.58 5.96 $ 164 Vested and exercisable—December 31, 2019 5,466,055 $ 7.69 4.78 $ — Stock‑based compensation expense We recognized stock‑based compensation expense for employees and non‑employees in the accompanying consolidated statements of operations as follows (in thousands): Year Ended December 31, 2019 2018 2017 Selling, general and administrative $ 6,552 $ 6,012 $ 4,027 Research and development 2,045 1,795 1,140 Total stock-based compensation $ 8,597 $ 7,807 $ 5,167 As of December 31, 2019, the total unrecognized compensation expense related to unvested options was $9.2 million, which we expect to recognize over an estimated weighted‑average period of 2.55 years. Included in the 2019 stock-based compensation amount is $179,000 of expenses relating to stock option modifications. In determining the estimated fair value of the stock‑based awards, we use the Black‑Scholes option‑pricing model and assumptions discussed below. Each of these inputs is subjective and generally requires significant judgment. The fair value of stock option awards was estimated with the following assumptions: Year Ended December 31, 2019 2018 2017 Expected term (in years) 5.57 6.11 5.98 Risk-free interest rate 1.38%-2.61% 2.25% - 3.04% 1.78-2.26 Expected volatility 76.5%-80.85% 78.2% - 85% 78.2% - 85% Dividend rate —% —% —% Restricted stock units We grant RSUs to employees and to members of our board of directors. RSUs that are granted to employees vest two years from the date of issuance, provided that the employee is employed by us on such vesting date. RSUs that are granted to directors, vest on the one-year anniversary of the grant date, provided that the director continues to serve as a member of the board of directors continuously from the grant date through such one-year anniversary. All RSUs will fully vest upon a change of control of our company. If and when the RSUs vest, we will issue one ordinary share for each whole RSU that has vested, subject to satisfaction of the employee’s or director’s tax withholding obligations. The RSUs will cease to be outstanding upon the issuance of ordinary shares upon vesting. We recorded expense, which is included in the stock-based compensation table above, of $1.4 million and $0.5 million for the year ended December 31, 2019 and 2018, respectively. As of December 31, 2019, the total unrecognized compensation expense related to unvested RSUs is $1.6 million, which we expect to recognize over an estimated weighted‑average period of 1.06 years. A summary of our unvested RSUs as of December 31, 2019 is as follows: Number of Shares Outstanding—January 1, 2019 143,100 Granted 1,001,000 Forfeited (283,500) Vested (69,250) Unvested—December 31, 2019 791,350 |
Segment and other information
Segment and other information | 12 Months Ended |
Dec. 31, 2019 | |
Segment and other information | |
Segment and other information | 15. Segment and other information Operating segments are identified as components of an enterprise about which separate discreet financial information is available for evaluation by the chief operating decision maker, or decision-making group, in making decisions on how to allocate resources and assess performance. We view our operations and manage our business in one operating segment. All of our sales were in the United States. The following table represents total long-lived assets by location (in thousands): December 31, 2019 December 31, 2018 United States $ 291 $ 294 Total long-lived assets (1) $ 291 $ 294 (1) Long-lived assets consist of property and equipment. Customer concentration The following table presents the gross sales from customers that represented more than 10% of our gross sales included in our single operating segment: 2019 2018 Customer A |
Sale of subsidiary
Sale of subsidiary | 12 Months Ended |
Dec. 31, 2019 | |
Sale of subsidiary | |
Sale of Subsidiary | 16. Sale of subsidiary In December 2018, we sold Strongbridge Ireland Limited, whose only asset was the rights to Macrilen, to Novo for $145 million. As part of the sale, we are entitled to receive tiered royalties based on net sales of Macrilen through 2027. We have received an immaterial amount of royalties on net sales of Macrilen to date. In addition, Strongbridge U.S. Inc. entered into a services agreement with NNI pursuant to which we agreed to provide 23 field-based employees of Strongbridge U.S. Inc. to NNI to provide commercial services related to Macrilen, including the promotion of Macrilen in the United States, for a period of three years. Novo also purchased 5.2 million of our ordinary shares at a purchase price of $7.00 per share. We accounted for the $14.3 million excess fair value of Novo’s share purchase over the market price of our ordinary shares as additional gain on the sale. We incurred $5.8 million of expenses relating to the sale, which were recorded as part of the gain on the sale. We originally acquired the product rights to Macrilen in January 2018 for $24.8 million and recorded amortization in 2018 of $2.2 million resulting in a net book value of $22.6 million at the time of sale. In December 2019, we reached an agreement with Novo to terminate the services agreement and we no longer provide these services to Novo. We received a $6 million payment from Novo, which was recorded to income from field service agreement in our Consolidated Statements of Operations and Comprehensive (Loss) Income. |
Quarterly consolidated financia
Quarterly consolidated financial information (unaudited) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly consolidated financial information (unaudited) | |
Quarterly financial information (unaudited) | 17. Quarterly consolidated financial information (unaudited) This table summarizes the unaudited consolidated financial results of operations for the quarters ended: ` March 31, June 30, September 30, December 31, 2019 Quarter Ended Net product sales $ 4,333 $ 6,073 $ 5,677 $ 5,593 Royalty revenues 10 6 7 13 Cost of sales (excluding amortization of intangible assets) 813 1,022 1,001 986 Amortization of intangible asset 1,256 1,255 1,255 1,256 Total costs and expenses 18,683 20,921 20,358 19,999 Other (expense) income (1,348) 9,272 3,831 7,655 Income tax expense (677) (400) (691) — Net loss (18,434) (8,247) (13,790) (8,980) Net loss per ordinary share, basic (1) (0.34) (0.15) (0.25) (0.17) Net loss per ordinary share, diluted (1) (0.34) (0.30) (0.31) (0.17) (in thousands, except share and per share data) March 31, June 30, September 30, December 31, 2018 Quarter Ended Net product sales $ 3,870 $ 4,296 $ 5,347 $ 4,514 Cost of sales (excluding amortization of intangible assets) 667 753 1,441 1,125 Amortization of intangible assets 1,769 1,872 1,876 1,670 Total costs and expenses 17,243 20,663 26,763 24,108 Other (expense) income (12,914) 16,070 4,174 106,980 Income tax expense — (1) — (535) Net (loss) income (28,723) (2,923) (20,559) 84,056 Net (loss) income per ordinary share, basic (1) (0.66) (0.06) (0.44) 1.73 Net (loss) income per ordinary share, diluted (1) (0.66) (0.43) (0.55) 1.64 (1) Net loss per share amounts may not agree to the per share for the full year due to the use of weighted-average shares for each period. |
Summary of significant accoun_2
Summary of significant accounting policies and basis of presentation (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of significant accounting policies and basis of presentation | |
Basis of presentation and principles of consolidation | Basis of presentation and principles of consolidation The accompanying consolidated financial statements include the accounts of our wholly owned subsidiaries, Strongbridge U.S. Inc. (Trevose, Pennsylvania, United States), Strongbridge Dublin Limited (Dublin, Ireland), Cortendo AB (Gothenburg, Sweden) and Cortendo Cayman (Georgetown, Cayman Islands). All intercompany balances and transactions have been eliminated in consolidation. These audited consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States (“U.S. GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative U.S. GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the FASB. |
Revenue recognition | Revenue recognition We follow ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”) , effective for revenue accounting. Topic 606 applies to all contracts with customers, except for contracts that are within the scope of other standards, such as leases, insurance, collaboration arrangements and financial instruments. Under Topic 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of Topic 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. We apply the five-step model to contracts only when it is probable that we will collect the consideration we are entitled to receive in exchange for the goods or services we transfer to the customer. At contract inception, once the contract is determined to be within the scope of Topic 606, we assess the goods or services promised within each contract, determine those that are performance obligations, and assess whether each promised good or service is distinct. We then recognize as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. For a complete discussion of accounting for net product revenue, see Note 3. |
Inventory and cost of sales | Inventory and cost of sales Inventory is stated at the lower of cost or net realizable value where cost is determined using the first-in, first-out method. Cost of sales includes the cost of inventory sold, which includes third-party acquisition costs, third-party warehousing and product distribution charges. |
Leases | Leases We account for leases in accordance with Accounting Standards Codification Topic 842, Leases , (“ASC 842”). We determine if an arrangement is a lease at contract inception. A lease exists when a contract conveys to us the right to control the use of identified property, plant, or equipment for a period of time in exchange for consideration. The definition of a lease embodies two conditions: (1) there is an identified asset in the contract that is land or a depreciable asset ( i.e. , property, plant, and equipment), and (2) we have the right to control the use of the identified asset. Operating leases where we are the lessee are included in Right of use (“ROU”) assets and Other current liabilities and Other long-term liabilities on our Consolidated Balance Sheets. The lease liabilities are initially and subsequently measured at the present value of the unpaid lease payments at the lease commencement date. Key estimates and judgments include how we determined (1) the discount rate we use to discount the unpaid lease payments to present value, (2) lease term and (3) lease payments. ASC 842 requires a lessee to discount its unpaid lease payments using the interest rate implicit in the lease or, if that rate cannot be readily determined, its incremental borrowing rate. Because our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Our incremental borrowing rate for a lease is the rate of interest we would have to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms. The lease term for all of our leases includes the noncancellable period of the lease. Lease payments included in the measurement of the lease asset or liability are comprised of our fixed payments. The ROU asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for lease payments made at or before the lease commencement date less any lease incentives received. For operating leases, the ROU asset is subsequently measured throughout the lease term at the carrying amount of the lease liability, plus (minus) any prepaid (accrued) lease payments, less the unamortized balance of lease incentives received. Lease expense for lease payments is recognized on a straight-line basis over the lease term. We monitor for events or changes in circumstances that require a reassessment of a lease. If a reassessment results in the remeasurement of a lease liability, a corresponding adjustment is made to the carrying amount of the corresponding ROU asset unless doing so would reduce the carrying amount of the ROU asset to an amount less than zero. In that case, the amount of the adjustment that would result in a negative ROU asset balance is recorded in profit or loss. We have elected not to recognize ROU assets and lease liabilities for all short-term leases that have a lease term of 12 months or less. We recognize the lease payments associated with our short-term leases as an expense on a straight-line basis over the lease term. Variable lease payments associated with these leases are recognized and presented in the same manner as for all our other leases. We adopted ASC 842 using a modified retrospective transition approach as of the effective date, as permitted by the amendments in ASU 2018-11. As a result, we were not required to adjust our comparative period financial information for effects of the standard or make the new required lease disclosures for periods before the date of adoption ( i.e., January 1, 2019). We have elected to adopt the package of transition practical expedients and, therefore, have not reassessed (1) whether existing or expired contracts contain a lease, (2) lease classification for existing or expired leases or (3) the accounting for initial direct costs that were previously capitalized. We did not elect the practical expedient to use hindsight for leases existing at the adoption date. Further, we do not expect the amendments in ASU 2018-01: Land Easement Practical Expedient to have an effect on us because we do not enter into land easement arrangements. |
Income and expense from Field Services Agreement | Income and Expense from Field Services Agreement In connection with our sale of our subsidiary, Strongbridge Ireland Limited, which owned the rights to Macrilen to Novo, Strongbridge U.S. Inc, one of our wholly-owned subsidiaries, entered into a field services agreement with Novo Nordisk Inc., a subsidiary of Novo (“NNI”), pursuant to which NNI agreed to fund the costs of 23 of our field-based employees to provide full-time ongoing services to NNI, including the promotion of Macrilen in the United States. This agreement was terminated effective December 1, 2019. Our income and expense under the field services agreement are recorded as non-operating income and expense, respectively. |
Use of estimates | Use of estimates The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the reported amounts in the financial statements and accompanying notes. We must apply significant judgment in this process. Actual results could materially differ from those estimates. |
Cash and cash equivalents | Cash, cash equivalents and marketable securities We consider all short‑term highly liquid investments with an original maturity at the date of purchase of three months or less to be cash equivalents. Cash and cash equivalents consist of account balances at banks and money market accounts, respectively. We invest our excess cash balances in marketable securities of highly rated financial institutions. We seek to diversify our investments and limit the amount of investment concentrations for individual institutions, maturities and investment types. We classify marketable debt securities as available-for-sale and, accordingly, record such securities at fair value. We classify these securities as current assets as these investments are intended to be available to us for use in funding current operations. T here were no marketable securities with a maturity of greater than one year as of December 31, 2019. Unrealized gains and losses on marketable debt securities are recorded as a separate component of accumulated other comprehensive income (loss) included in stockholders’ equity. |
Marketable securities | Cash, cash equivalents and marketable securities We consider all short‑term highly liquid investments with an original maturity at the date of purchase of three months or less to be cash equivalents. Cash and cash equivalents consist of account balances at banks and money market accounts, respectively. We invest our excess cash balances in marketable securities of highly rated financial institutions. We seek to diversify our investments and limit the amount of investment concentrations for individual institutions, maturities and investment types. We classify marketable debt securities as available-for-sale and, accordingly, record such securities at fair value. We classify these securities as current assets as these investments are intended to be available to us for use in funding current operations. T here were no marketable securities with a maturity of greater than one year as of December 31, 2019. Unrealized gains and losses on marketable debt securities are recorded as a separate component of accumulated other comprehensive income (loss) included in stockholders’ equity. |
Concentration of credit risk and other risks and uncertainties | Concentration of credit risk and other risks and uncertainties As part of our cash and investment management processes, we perform periodic evaluations of the credit standing of the financial institutions with which we deposit our cash or purchase cash equivalents or marketable securities, and we have not sustained any credit losses from instruments held at these financial institutions. |
Fair value of financial instruments | Fair value of financial instruments Fair value accounting is applied for all financial assets and liabilities and non‑financial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually). We are required to disclose information on all assets and liabilities reported at fair value that enables an assessment of the inputs used in determining the reported fair values. FASB ASC Topic 820, Fair Value Measurements and Disclosures (“ASC 820”), establishes a hierarchy of inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of us. Unobservable inputs are inputs that reflect our assumptions about the inputs that market participants would use in pricing the asset or liability and are developed based on the best information available in the circumstances. The fair value hierarchy applies only to the valuation inputs used in determining the reported fair value of the investments and is not a measure of the investment credit quality. The three levels of the fair value hierarchy are described as follows: Level 1—Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that we have the ability to access at the measurement date. Level 2—Valuations based on quoted prices for similar assets or liabilities, or quoted prices in markets that are not active, and for which all significant inputs are observable, either directly or indirectly. Level 3—Valuations that require inputs that reflect our own assumptions that are both significant to the fair value measurement and unobservable. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment we exercise in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. In December 2016, we issued warrants in connection with our private placement of ordinary shares. Pursuant to the terms of the warrant agreement, we could be required to settle the warrants in cash in the event of an acquisition of the Company and, as a result, the warrants are required to be measured at fair value and reported as a liability in the consolidated balance sheet. We recorded the fair value of the warrants upon issuance using the Black-Scholes Model and are required to revalue the warrants at each reporting date with any changes in fair value recorded on our statement of operations. The valuation of the warrants is considered under Level 3 of the fair value hierarchy due to the need to use assumptions in the valuation that that are both significant to the fair value measurement and unobservable. The change in the fair value of the Level 3 warrant liabilities is reflected in the statement of operations for the years ended December 31, 2019, 2018 and 2017. |
Property and equipment, net | Property and equipment, net Property and equipment, net, consists of office equipment such as furniture, fixtures and computers. Depreciation expense for the years ended December 31, 2019 and 2018, was not significant. The following useful lives were used for the various classifications of property and equipment, net: Amortization Periods Computer hardware - years Computer software - years Furniture and fixtures - years Leasehold improvements Lesser of useful life or remaining lease term |
Intangible assets | Intangible assets Certain intangible assets were acquired as part of an asset purchase and have been capitalized at their acquisition date fair value. Acquired definite life intangible assets are amortized using the straight-line method over their respective estimated useful lives. We evaluate the potential impairment of intangible assets if events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable or that the useful lives of these assets are no longer appropriate. |
Goodwill | Goodwill We test goodwill for impairment on an annual basis or whenever events occur that may indicate possible impairment. This analysis requires us to make a series of critical assumptions to (1) evaluate whether any impairment exists and (2) measure the amount of impairment. Because we have one operating segment, when testing for a potential impairment of goodwill, we are required to estimate the fair value of our business and determine the carrying value. If the estimated fair value is less than the carrying value of our business, then we are required to estimate the fair value of all identifiable assets and liabilities in a manner similar to a purchase price allocation for an acquired business. Only after this process is completed can the goodwill impairment be determined, if any. To estimate the fair value of the business, primarily a market‑based approach is applied, utilizing our public market value. We did not record a charge for impairment for our goodwill for the years ended December 31, 2019, 2018, and 2017. |
Stock-based compensation | Stock‑based compensation We account for stock‑based compensation awards in accordance with Financial Accounting Standards Board (“FASB”) ASC Topic 718, Compensation—Stock Compensation (“ASC 718”). ASC 718 requires all stock‑based payments including grants of stock options and restricted stock and modifications to existing stock options, to be recognized in the consolidated statements of operations based on their fair values. We record compensation expense for service-based awards over the vesting period of the award on a straight-line basis. Compensation expense related to awards with performance-based vesting conditions is recognized over the requisite service period using the accelerated attribution method to the extent achievement of the performance condition is probable. We estimate the fair value of our awards with service conditions using the Black‑Scholes option pricing model, which requires the input of subjective assumptions, including (i) the expected stock price volatility, (ii) the expected term of the award, (iii) the risk‑free interest rate and (iv) expected dividends. We have estimated the expected term of employee service-based stock options using the “simplified” method, whereby the expected term equals the arithmetic average of the vesting term and the original contractual term of the option, due to our lack of sufficient historical data. The risk-free interest rates for periods within the expected term of the option are based on the U.S. Treasury Bond rate with a maturity date commensurate with the expected term of the associated award. We have never paid dividends and do not expect to pay dividends in the foreseeable future. We account for forfeitures as they occur as opposed to estimating forfeitures. We record stock-based compensation expense only for those awards that are expected to vest. |
Income taxes | Income taxes On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act makes broad and complex changes to the U.S. tax code, including, but not limited to, reducing the top U.S. federal corporate tax rate from 35 percent to 21 percent; requiring companies to pay a one-time transition tax on certain un-repatriated earnings of foreign subsidiaries; generally eliminating U.S. federal income taxes on dividends from foreign subsidiaries; requiring a current inclusion in U.S. federal taxable income of certain earnings of controlled foreign corporations; eliminating the corporate alternative minimum tax (“AMT”) and changing how existing AMT credits can be realized; creating the base erosion anti-abuse tax (“BEAT”), a new minimum tax; creating a new limitation on deductible interest expense; and changing rules related to uses and limitations of net operating loss carryforwards created in tax years beginning after December 31, 2017. The Tax Act reduces our U.S. corporate income tax rate from 34% to 21%, effective January 1, 2018. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. As a result of the reduction in the U.S. corporate income tax rate from 34% to 21% under the Tax Act, we revalued our ending net deferred tax assets and liabilities at December 31, 2017. We recognize interest and penalties related to uncertain tax positions in income tax expense. As of December 31, 2019, 2018 and 2017, we had no accrued interest or penalties related to uncertain tax positions and no amounts have been recognized in our statements of operations. |
Net income (loss) per share | Net (loss) income per share Basic net (loss) income per share is calculated by dividing the net (loss) income attributable to shareholders by the weighted-average number of ordinary shares outstanding during the period. Diluted net (loss) income per share is calculated by dividing the net (loss) income attributable to shareholders by the weighted‑average number of ordinary shares outstanding for the period, including any dilutive effect from outstanding stock options and other equity-based awards. Net (loss) income per share was calculated as follows for the periods indicated below: Year Ended December 31, (in thousands, except per share data) 2019 2018 2017 Basic Net (Loss) Income Per Share Basic net (loss) income $ (49,451) $ 31,851 $ (113,483) Unrealized gain on fair value of warrants $ 11,386 $ 16,337 $ - Diluted net (loss) income $ (60,837) $ 15,514 $ (113,483) Weighted-average ordinary shares outstanding 54,182,499 46,297,088 36,544,825 Basic net (loss) income per share $ (0.91) $ 0.69 $ (3.11) Diluted Net (Loss) Income Per Share Diluted net (loss) income $ (60,837) $ 15,514 $ (113,483) Weighted-average ordinary shares outstanding 54,182,499 46,297,088 36,544,825 Dilutive warrants, stock options and RSUs 1,200,531 3,427,415 - Weighted-average shares used to compute diluted net income (loss) per share 55,383,030 49,724,503 36,544,825 Diluted net (loss) income per share $ (1.10) $ 0.31 $ (3.11) Shares used in the diluted net loss per share calculations exclude anti‑dilutive ordinary share equivalents, which consist of outstanding stock options, unvested restricted stock units and warrants, if applicable. December 31, 2019 2018 2017 Warrants 1,803,253 1,642,539 7,555,003 Stock options issued and outstanding 9,192,684 4,444,830 6,104,715 Unvested RSUs 791,350 — 267,250 |
Recently issued accounting pronouncements | Recently issued accounting pronouncements In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other: Simplifying the Accounting for Goodwill Impairment. ASU 2017-04 removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. This standard, which will be effective for us beginning in the first quarter of fiscal year 2020, is required to be applied prospectively. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. We do not expect the adoption of this standard to have a significant impact on our financial statements or internal controls. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments . ASU 2016-13 requires an entity to measure and recognize expected credit losses for certain financial instruments, including trade receivables, as an allowance that reflects the entity's current estimate of credit losses expected to be incurred. For available-for-sale debt securities with unrealized losses, the standard requires allowances to be recorded through net income instead of directly reducing the amortized cost of the investment under the current other-than-temporary impairment model. The standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019, with early adoption permitted. We do not expect the adoption of this standard to have a significant impact on our financial statements or internal controls. |
Summary of significant accoun_3
Summary of significant accounting policies and basis of presentation (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of significant accounting policies and basis of presentation | |
Schedule of useful lives of various classification of property and equipment, net | Amortization Periods Computer hardware - years Computer software - years Furniture and fixtures - years Leasehold improvements Lesser of useful life or remaining lease term |
Schedule of Net income (loss) per share | Year Ended December 31, (in thousands, except per share data) 2019 2018 2017 Basic Net (Loss) Income Per Share Basic net (loss) income $ (49,451) $ 31,851 $ (113,483) Unrealized gain on fair value of warrants $ 11,386 $ 16,337 $ - Diluted net (loss) income $ (60,837) $ 15,514 $ (113,483) Weighted-average ordinary shares outstanding 54,182,499 46,297,088 36,544,825 Basic net (loss) income per share $ (0.91) $ 0.69 $ (3.11) Diluted Net (Loss) Income Per Share Diluted net (loss) income $ (60,837) $ 15,514 $ (113,483) Weighted-average ordinary shares outstanding 54,182,499 46,297,088 36,544,825 Dilutive warrants, stock options and RSUs 1,200,531 3,427,415 - Weighted-average shares used to compute diluted net income (loss) per share 55,383,030 49,724,503 36,544,825 Diluted net (loss) income per share $ (1.10) $ 0.31 $ (3.11) |
Schedule of potentially dilutive securities excluded from computations of diluted weighted average shares outstanding | December 31, 2019 2018 2017 Warrants 1,803,253 1,642,539 7,555,003 Stock options issued and outstanding 9,192,684 4,444,830 6,104,715 Unvested RSUs 791,350 — 267,250 |
Revenue recognition (Tables)
Revenue recognition (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Revenue recognition | |
Schedule of disaggregation of revenue | The following table summarizes revenue by product for the twelve months ended December 31, 2019 and 2018 (in thousands): Year Ended Year Ended Year Ended December 31, 2019 December 31, 2018 December 31, 2017 Products Keveyis $ 21,676 $ 16,802 $ 7,046 Macrilen — 1,225 — Total $ 21,676 $ 18,027 $ 7,046 |
Fair value measurement (Tables)
Fair value measurement (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair value measurement | |
Schedule of fair value of financial assets by level | The following table presents our assets and liabilities that are measured at fair value on a recurring basis for the periods presented (in thousands) : As of December 31, 2019 Level I Level II Level III Total Cash equivalents 56,544 — — 56,544 Marketable securities — 21,072 — 21,072 Total assets $ 56,544 $ $ — $ 77,616 Warrant liability — — 4,127 4,127 Total liabilities $ — $ — $ 4,127 $ 4,127 As of December 31, 2018 Level I Level II Level III Total Cash equivalents 122,300 — — 122,300 Total assets $ 122,300 $ — $ — $ 122,300 Warrant liability — — 15,513 15,513 Total liabilities $ — $ — $ 15,513 $ 15,513 |
Schedule of reconciliation of level 3 Warrant liability | The following table presents a reconciliation of our level 3 Warrant liability (in thousands): As of December 31, 2019 Balance as of December 31, 2018 $ 15,513 Unrealized gain on fair value of warrants for the year ended December 31, 2019 (11,386) Balance as of December 31, 2019 $ 4,127 |
Intangible assets and goodwill
Intangible assets and goodwill (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Intangible assets and goodwill | |
Schedule of gross carrying amount of in process research and development and goodwill | The gross carrying amount of in‑process research and development, acquired developed product rights and goodwill is as follows (in thousands): As of December 31, 2019 Beginning of Period Additions Sold Amortization End of Period Keveyis $ 30,132 $ — $ — $ (5,022) $ 25,110 Goodwill 7,256 — — — 7,256 Total $ 37,388 $ — $ — $ (5,022) $ 32,366 As of December 31, 2018 Beginning of Period Additions Sold Amortization End of Period Keveyis $ 35,155 $ — $ — $ (5,023) $ 30,132 Macrilen — 24,834 (22,670) (2,164) — Goodwill 7,256 — — — 7,256 Total $ 42,411 $ 24,834 $ (22,670) $ (7,187) $ 37,388 |
Schedule of estimated amortization of our acquired developed product rights intangible asset | Estimated amortization of our acquired developed product rights intangible asset for the five years subsequent to December 31, 2019 is as follows (in thousands): 2020 $ 5,022 2021 5,022 2022 5,022 2023 5,022 2024 5,022 |
Marketable securities (Tables)
Marketable securities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Marketable securities | |
Schedule of amortized cost, gross unrealized holding gains, gross unrealized holding losses and fair value of available-for-sale debt securities by type of security | Marketable securities consist of the following: As of December 31, 2019 Amortized Cost Net Unrealized Gain Fair Value Commercial Paper $ 11,889 $ — $ 11,889 U.S. treasury securities 2,982 — 2,982 Asset-backed securities 6,198 3 6,201 Total marketable securities $ 21,069 $ 3 $ 21,072 |
Accrued liabilities (Tables)
Accrued liabilities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accrued liabilities | |
Schedule of accrued and other current liabilities | Accrued liabilities consist of the following (in thousands): December 31, December 31, 2019 2018 Employee compensation $ 4,452 $ 5,717 Consulting and professional fees 4,335 4,145 Accrued sales allowances 2,990 2,233 Severance 2,968 — Supply agreement - current portion 2,773 1,638 Accrued taxes 1,892 535 Accrued royalties 806 802 Lease liability - current portion 374 — Other 372 995 Total accrued liabilities $ 20,962 $ 16,065 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases | |
Schedule of future minimum commitments under facility operating leases | As of December 31, 2019, future minimum commitments under facility operating leases were as follows (in thousands): Operating leases 2020 470 2021 481 2022 492 2023 207 Total minimum lease payments $ 1,650 |
Schedule of components of lease cost | The components of lease cost for the quarter ended December 31, 2019 are as follows (in thousands): Year Ended December 31, 2019 Lease costs Amortization of right of use assets $ 335 Interest on lease liabilities 122 Total lease cost $ 457 |
Schedule of amounts reported for leases in consolidated balance sheets | Amounts reported in the Consolidated Balance Sheet for leases where we are the lessee as of December 31, 2019 were as follows (in thousands): December 31, 2019 Operating Leases Right of use asset $ 789 Lease liability $ 1,080 Remaining lease term Operating leases 3 years 5 months Discount rate Operating leases |
Warrants (Tables)
Warrants (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Warrants | |
Schedule of warrants | Warrants Outstanding Exercise Expiration Warrants Warrants December 31, Classification Price Date Issued Exercised 2019 Warrants in connection with private equity placement Liability $ 2.50 6/28/2022 7,000,000 (1,970,000) 5,030,000 Warrants in connection with Horizon and Oxford loan agreement Equity $ 2.45 12/28/2026 428,571 (267,857) 160,714 Warrants in connection with CRG loan agreement Equity $ 7.37 7/14/2024 394,289 — 394,289 Warrants in connection with CRG loan amendment in January 2018 Equity $ 10.00 1/16/2025 1,248,250 — 1,248,250 9,071,110 6,833,253 |
Income taxes (Tables)
Income taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income taxes | |
Schedule of components of loss before income taxes | For the years ended December 31, 2019, 2018 and 2017, the components of income (loss) before income taxes were as follows (in thousands): Year Ended December 31, 2019 2018 2017 Sweden $ (1,989) $ 4,712 $ (19,249) Ireland (23,708) 73,409 (47,211) Cayman Islands (1,587) (701) (21,709) U.S. (20,399) (45,033) (23,543) Total $ (47,683) $ 32,387 $ (111,712) |
Schedule of components of income tax (benefit) | The components of income tax expense (benefit) for the years ended December 31, 2019, 2018 and 2017 were as follows (in thousands): Year Ended December 31, 2019 2018 2017 Current tax (benefit) expense: Sweden $ 1,767 $ 535 $ — Ireland — — (22) U.S. Federal — — (151) State 1 1 (14) Total current tax expense (benefit) $ 1,768 $ 536 $ (187) Deferred tax expense (benefit): Sweden $ — $ 12,395 $ (4,586) Ireland (8,484) (13,337) 1,280 U.S. Federal (7,914) (1,785) 39 State (784) (354) (2,392) Change in valuation allowance 17,182 3,081 7,617 Total deferred tax expense (benefit) — — 1,958 Total tax expense (benefit) $ 1,768 $ 536 $ 1,771 |
Schedule of tax effect of temporary differences that give rise to significant portions of the deferred tax assets | The tax effect of temporary differences that give rise to significant portions of the deferred tax assets are as follows (in thousands): Year Ended December 31, 2019 2018 Deferred tax assets: Net operating loss carryforwards $ 16,283 $ 4,932 Stock-based compensation 6,811 4,944 Lease Liability 404 107 Intangible Amortization 628 Other deferred activity 250 497 Tax credits 14,533 10,826 Interest disallowance 9,687 9,889 Intangibles 13,240 13,240 Total deferred tax assets 61,836 44,435 Valuation allowance (61,617) (44,435) Deferred tax assets recognized 219 — Deferred tax liabilities: Lease Liability - Right of Use (219) — Total deferred tax liabilities (219) — Net deferred tax assets (liabilities) $ — $ — |
Schedule of effective tax rate reconciliation to statutory rate | Year Ended December 31, 2019 2018 2017 Ireland statutory income tax rate 12.50 % 12.50 % 12.50 % Foreign tax differential between Sweden, U.S., Cayman Island and Ireland 1.39 7.55 3.99 Federal tax credits 7.77 (4.58) — Change in valuation allowance (36.04) 9.51 (6.82) State income taxes 1.64 (1.09) 1.43 Permanent differences 2.92 4.01 (5.04) Rate change - tax impact — — (7.09) Foreign exchange remeasurement of Swedish deferred tax asset — — 0.83 Provision to return 0.53 3.95 (1.33) Sale of subsidiary — (37.58) — Net operating loss adjustment 5.57 7.72 — Other — (0.34) (0.06) Effective income tax rate (3.72) % 1.65 % (1.59) % |
Stock-based compensation (Table
Stock-based compensation (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Stock-based compensation | |
Schedule of summary of outstanding stock options activity | Options Outstanding Weighted- Average Weighted- Remaining Average Contractual Number of Exercise Term Aggregate Shares Price (Years) Intrinsic Value (in thousands) Outstanding—January 1, 2019 8,579,511 $ 7.35 7.57 $ 3,281 Granted 2,788,900 $ 3.85 Forfeited and cancelled (2,131,886) $ 5.20 Exercised (43,841) $ 4.12 Outstanding—December 31, 2019 9,192,684 $ 6.58 5.96 $ 164 Vested and exercisable—December 31, 2019 5,466,055 $ 7.69 4.78 $ — |
Schedule of stock-based compensation | We recognized stock‑based compensation expense for employees and non‑employees in the accompanying consolidated statements of operations as follows (in thousands): Year Ended December 31, 2019 2018 2017 Selling, general and administrative $ 6,552 $ 6,012 $ 4,027 Research and development 2,045 1,795 1,140 Total stock-based compensation $ 8,597 $ 7,807 $ 5,167 |
Schedule of assumptions for estimating fair value of stock option awards | Year Ended December 31, 2019 2018 2017 Expected term (in years) 5.57 6.11 5.98 Risk-free interest rate 1.38%-2.61% 2.25% - 3.04% 1.78-2.26 Expected volatility 76.5%-80.85% 78.2% - 85% 78.2% - 85% Dividend rate —% —% —% |
Schedule of summary of unvested RSUs | Number of Shares Outstanding—January 1, 2019 143,100 Granted 1,001,000 Forfeited (283,500) Vested (69,250) Unvested—December 31, 2019 791,350 |
Segment and other information (
Segment and other information (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Segment and other information | |
Schedule of long-lived assets by location | The following table represents total long-lived assets by location (in thousands): December 31, 2019 December 31, 2018 United States $ 291 $ 294 Total long-lived assets (1) $ 291 $ 294 (1) Long-lived assets consist of property and equipment. |
Schedule of customer concentration | The following table presents the gross sales from customers that represented more than 10% of our gross sales included in our single operating segment: 2019 2018 Customer A |
Quarterly consolidated financ_2
Quarterly consolidated financial information (unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly consolidated financial information (unaudited) | |
Schedule of unaudited quarterly consolidated financial information | ` March 31, June 30, September 30, December 31, 2019 Quarter Ended Net product sales $ 4,333 $ 6,073 $ 5,677 $ 5,593 Royalty revenues 10 6 7 13 Cost of sales (excluding amortization of intangible assets) 813 1,022 1,001 986 Amortization of intangible asset 1,256 1,255 1,255 1,256 Total costs and expenses 18,683 20,921 20,358 19,999 Other (expense) income (1,348) 9,272 3,831 7,655 Income tax expense (677) (400) (691) — Net loss (18,434) (8,247) (13,790) (8,980) Net loss per ordinary share, basic (1) (0.34) (0.15) (0.25) (0.17) Net loss per ordinary share, diluted (1) (0.34) (0.30) (0.31) (0.17) (in thousands, except share and per share data) March 31, June 30, September 30, December 31, 2018 Quarter Ended Net product sales $ 3,870 $ 4,296 $ 5,347 $ 4,514 Cost of sales (excluding amortization of intangible assets) 667 753 1,441 1,125 Amortization of intangible assets 1,769 1,872 1,876 1,670 Total costs and expenses 17,243 20,663 26,763 24,108 Other (expense) income (12,914) 16,070 4,174 106,980 Income tax expense — (1) — (535) Net (loss) income (28,723) (2,923) (20,559) 84,056 Net (loss) income per ordinary share, basic (1) (0.66) (0.06) (0.44) 1.73 Net (loss) income per ordinary share, diluted (1) (0.66) (0.43) (0.55) 1.64 Net loss per share amounts may not agree to the per share for the full year due to the use of weighted-average shares for each period. |
Organization - Products (Detail
Organization - Products (Details) | Dec. 31, 2019product |
Organization | |
Number of clinical-stage product candidates | 2 |
Organization - Sale of subsidia
Organization - Sale of subsidiary (Details) $ / shares in Units, $ in Millions | Dec. 18, 2018$ / sharesshares | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($)employee$ / sharesshares | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($)$ / sharesshares |
Ordinary Shares | |||||
Sale of subsidiary | |||||
Issuance of shares to Novo (in shares) | shares | 5,242,000 | ||||
Disposal Group, Disposed of by Sale, Not Discontinued Operations | Strongbridge Ireland Ltd. | |||||
Sale of subsidiary | |||||
Consideration for sale of subsidiary | $ | $ 145 | $ 145 | |||
Novo | |||||
Sale of subsidiary | |||||
Termination payment | $ | $ 6 | $ 6 | |||
Novo | Ordinary Shares | |||||
Sale of subsidiary | |||||
Issuance of shares to Novo (in shares) | shares | 5,242,000 | 5,200,000 | |||
Price per share (in dollars per share) | $ / shares | $ 7 | $ 7 | $ 7 | ||
NNI | Services Agreement | |||||
Sale of subsidiary | |||||
Number of employees funded by counterparty | employee | 23 | ||||
Term of agreement | 3 years |
Organization - Liquidity (Detai
Organization - Liquidity (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Liquidity | ||
Cash resources | $ 78,100 | |
Cash and cash equivalents | $ 57,032 | $ 122,490 |
Substantial doubt about going concern, within one year | false |
Summary of significant accoun_4
Summary of significant accounting policies and basis of presentation - Leases (Details) | Jan. 01, 2019 | Dec. 31, 2019 |
Recently issued accounting pronouncements | ||
Operating Lease, Liability, Statement of Financial Position | us-gaap:OtherLiabilitiesCurrent us-gaap:OtherLiabilitiesNoncurrent | |
Lease, Practical Expedients, Package | true | |
Lease, Practical Expedient, Use of Hindsight | false | |
ASU 2016-02 | ||
Recently issued accounting pronouncements | ||
Change in Accounting Principle, Accounting Standards Update, Adopted | true | |
Change in Accounting Principle, Accounting Standards Update, Transition Option Elected | Modified Retrospective | |
New Accounting Pronouncement or Change in Accounting Principle, Prior Period Not Restated | true |
Summary of significant accoun_5
Summary of significant accounting policies and basis of presentation - Field Service Agreement (Details) | 1 Months Ended |
Dec. 31, 2019employee | |
NNI | |
Agreements | |
Number of employees funded by counterparty | 23 |
Summary of significant accoun_6
Summary of significant accounting policies and basis of presentation - Property and equipment, net (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Computer hardware | Minimum | |
Property and equipment, net | |
Amortization Periods | 3 years |
Computer hardware | Maximum | |
Property and equipment, net | |
Amortization Periods | 5 years |
Computer software | Minimum | |
Property and equipment, net | |
Amortization Periods | 2 years |
Computer software | Maximum | |
Property and equipment, net | |
Amortization Periods | 5 years |
Furniture and fixtures | Minimum | |
Property and equipment, net | |
Amortization Periods | 2 years |
Furniture and fixtures | Maximum | |
Property and equipment, net | |
Amortization Periods | 5 years |
Summary of significant accoun_7
Summary of significant accounting policies and basis of presentation - Goodwill (Details) | 12 Months Ended |
Dec. 31, 2019segment | |
Goodwill | |
Number of operating segments | 1 |
Summary of significant accoun_8
Summary of significant accounting policies and basis of presentation - Income taxes (Details) - USD ($) | Dec. 22, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Income taxes | ||||
Accrued interest or penalties related to uncertain tax positions | $ 0 | $ 0 | $ 0 | |
Interest or penalties related to uncertain tax positions | $ 0 | $ 0 | $ 0 | |
Federal corporate tax rate | 12.50% | 12.50% | 12.50% | |
U.S. | ||||
Income taxes | ||||
Federal corporate tax rate | 35.00% | 21.00% | 21.00% | 34.00% |
Summary of significant accoun_9
Summary of significant accounting policies and basis of presentation - Net loss per share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Basic Net (Loss) Income Per Share | |||||||||||
Basic net (loss) income | $ (49,451) | $ 31,851 | $ (113,483) | ||||||||
Unrealized gain on fair value of warrants | (11,386) | (16,337) | |||||||||
Diluted net (loss) income | $ (60,837) | $ 15,514 | $ (113,483) | ||||||||
Weighted-average ordinary shares outstanding (in shares) | 54,182,499 | 46,297,088 | 36,544,825 | ||||||||
Basic (in dollars per share) | $ (0.17) | $ (0.25) | $ (0.15) | $ (0.34) | $ 1.73 | $ (0.44) | $ (0.06) | $ (0.66) | $ (0.91) | $ 0.69 | $ (3.11) |
Diluted Net (Loss) Income Per Share | |||||||||||
Diluted net (loss) income | $ (60,837) | $ 15,514 | $ (113,483) | ||||||||
Weighted-average ordinary shares outstanding (in shares) | 54,182,499 | 46,297,088 | 36,544,825 | ||||||||
Incremental Common Shares Attributable to Dilutive Effect of Share-based Payment Arrangements | 1,200,531 | 3,427,415 | |||||||||
Weighted-average shares used to compute diluted net income (loss) per share | 55,383,030 | 49,724,503 | 36,544,825 | ||||||||
Diluted (in dollars per share) | $ (0.17) | $ (0.31) | $ (0.30) | $ (0.34) | $ 1.64 | $ (0.55) | $ (0.43) | $ (0.66) | $ (1.10) | $ 0.31 | $ (3.11) |
Summary of significant accou_10
Summary of significant accounting policies and basis of presentation - Anti-dilutive securities (Details) - shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Warrant liability | |||
Net loss per share | |||
Anti-dilutive shares of common stock (in shares) | 1,803,253 | 1,642,539 | 7,555,003 |
Stock options | |||
Net loss per share | |||
Anti-dilutive shares of common stock (in shares) | 9,192,684 | 4,444,830 | 6,104,715 |
RSUs | |||
Net loss per share | |||
Anti-dilutive shares of common stock (in shares) | 791,350 | 267,250 |
Revenue recognition - Disaggreg
Revenue recognition - Disaggregation of Revenue (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019USD ($)customer | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2019USD ($)customer | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Revenue by product | |||||||||||
Number of specialty provider | customer | 1 | 1 | |||||||||
Total revenues | $ 21,712 | $ 18,027 | $ 7,046 | ||||||||
Product | |||||||||||
Revenue by product | |||||||||||
Total revenues | $ 5,593 | $ 5,677 | $ 6,073 | $ 4,333 | $ 4,514 | $ 5,347 | $ 4,296 | $ 3,870 | 21,676 | 18,027 | 7,046 |
Keveyis | |||||||||||
Revenue by product | |||||||||||
Total revenues | $ 21,676 | 16,802 | $ 7,046 | ||||||||
Macrilen | |||||||||||
Revenue by product | |||||||||||
Total revenues | $ 1,225 |
Revenue recognition - Reserves
Revenue recognition - Reserves (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Reserve for returns | $ 0 |
Percentage of patient’s cost of branded prescription drugs related to the Medicare Part D Coverage Gap for which manufacturers of pharmaceutical products are responsible | 70.00% |
Maximum | |
Temporary supply period | 60 days |
Financial need period | 12 months |
Fair value measurement (Details
Fair value measurement (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Assets | ||
Marketable securities | $ 21,072 | |
Liabilities | ||
Warrant liabilities | 4,127 | $ 15,513 |
Recurring | ||
Assets | ||
Cash equivalents | 56,544 | 122,300 |
Marketable securities | 21,072 | |
Total Assets | 77,616 | 122,300 |
Liabilities | ||
Warrant liabilities | 4,127 | 15,513 |
Total liabilities | 4,127 | 15,513 |
Recurring | Level I | ||
Assets | ||
Cash equivalents | 56,544 | 122,300 |
Total Assets | 56,544 | 122,300 |
Recurring | Level II | ||
Assets | ||
Marketable securities | 21,072 | |
Total Assets | 21,072 | |
Recurring | Level III | ||
Liabilities | ||
Warrant liabilities | 4,127 | 15,513 |
Total liabilities | $ 4,127 | $ 15,513 |
Fair value measurement - Level
Fair value measurement - Level 3 (Details) - Warrant liability $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Reconciliation of level 3: | |
Balance at beginning of period | $ 15,513 |
Unrealized gain on fair value of warrants | (11,386) |
Balance at end of period | $ 4,127 |
Intangible assets and goodwil_2
Intangible assets and goodwill - Components (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 31, 2018 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Intangible assets and goodwill | ||||||||||||
Finite-lived intangible assets, Amortization | $ (1,256) | $ (1,255) | $ (1,255) | $ (1,256) | $ (1,670) | $ (1,876) | $ (1,872) | $ (1,769) | $ (5,022) | $ (7,187) | $ (5,022) | |
Goodwill, Beginning of Period | $ 7,256 | 7,256 | 7,256 | 7,256 | 7,256 | |||||||
Goodwill, End of Period | 7,256 | 7,256 | 7,256 | 7,256 | 7,256 | |||||||
Total, Beginning of Period | 42,411 | 37,388 | 42,411 | 37,388 | 42,411 | |||||||
Total, Additions | 24,834 | |||||||||||
Total Sold | (22,670) | |||||||||||
Total, End of Period | 32,366 | 37,388 | 32,366 | 37,388 | 42,411 | |||||||
Keveyis | ||||||||||||
Intangible assets and goodwill | ||||||||||||
Finite-lived intangible assets, Beginning of Period | 35,155 | $ 30,132 | $ 35,155 | 30,132 | 35,155 | |||||||
Finite-lived intangible assets, Amortization | (5,022) | (5,023) | ||||||||||
Finite-lived intangible assets, End of Period | $ 25,110 | $ 30,132 | $ 25,110 | 30,132 | $ 35,155 | |||||||
Macrilen | ||||||||||||
Intangible assets and goodwill | ||||||||||||
Finite-lived intangible assets, Additions | $ 24,800 | 24,834 | ||||||||||
Finite-lived intangible assets, Sold | (22,670) | |||||||||||
Finite-lived intangible assets, Amortization | $ (2,164) |
Intangible assets and goodwil_3
Intangible assets and goodwill - Amortization maturity schedule (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Amortization of intangible asset | |
2020 | $ 5,022 |
2021 | 5,022 |
2022 | 5,022 |
2023 | 5,022 |
2024 | $ 5,022 |
Intangible assets and goodwil_4
Intangible assets and goodwill - Asset purchase (Details) - Acquired product rights - Keveyis $ in Millions | 1 Months Ended | |
Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($)installment | |
In-process research and development and Goodwill | ||
Number of installment payments | installment | 2 | |
Installment payment | $ 7.5 | $ 1 |
Payments in excess of fair value | 29.3 | |
Transaction costs | 2.4 | |
Acquired product rights | $ 40.2 | |
Estimated life | 8 years |
Marketable securities (Details)
Marketable securities (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Marketable securities | |
Amortized Cost | $ 21,069 |
Net Unrealized Gains | 3 |
Fair Value | 21,072 |
Commercial Paper | |
Marketable securities | |
Amortized Cost | 11,889 |
Fair Value | 11,889 |
U.S. treasury securities | |
Marketable securities | |
Amortized Cost | 2,982 |
Fair Value | 2,982 |
Asset-backed securities | |
Marketable securities | |
Amortized Cost | 6,198 |
Net Unrealized Gains | 3 |
Fair Value | $ 6,201 |
Accrued liabilities (Details)
Accrued liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Accrued liabilities | ||
Employee compensation | $ 4,452 | $ 5,717 |
Consulting and professional fees | 4,335 | 4,145 |
Accrued sales allowances | 2,990 | 2,233 |
Severance | 2,968 | |
Supply agreement - current portion | 2,773 | 1,638 |
Accrued royalties | 806 | 802 |
Lease liability - current portion | 374 | |
Other | 372 | 995 |
Accrued taxes | 1,892 | 535 |
Total accrued liabilities | $ 20,962 | $ 16,065 |
Operating Lease, Liability, Current, Statement of Financial Position | us-gaap:AccruedLiabilitiesCurrent |
Leases - Future minimum commitm
Leases - Future minimum commitments (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Future minimum commitments under facility operating leases: | |
2020 | $ 470 |
2021 | 481 |
2022 | 492 |
2023 | 207 |
Total minimum lease payments | $ 1,650 |
Minimum | |
Leases | |
Initial lease term | 1 year |
Maximum | |
Leases | |
Initial lease term | 5 years |
Leases - Components of lease co
Leases - Components of lease cost (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Lease costs | |
Amortization of right of use assets | $ 335 |
Interest on lease liabilities | 122 |
Total lease cost | $ 457 |
Leases - Balance sheet location
Leases - Balance sheet location (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Leases | |
Right of use asset | $ 789 |
Lease liability | $ 1,080 |
Operating Lease, Liability, Statement of Financial Position | us-gaap:OtherLiabilitiesCurrent us-gaap:OtherLiabilitiesNoncurrent |
Remaining lease term - Operating leases | 41 months |
Discount rate - Operating leases | 7.69% |
Warrants (Details)
Warrants (Details) | 12 Months Ended |
Dec. 31, 2019$ / sharesshares | |
Warrants | |
Warrants Issued (in shares) | 9,071,110 |
Warrants Outstanding (in shares) | 6,833,253 |
Warrants in connection with private equity placement | |
Warrants | |
Exercise Price (in dollars per share) | $ / shares | $ 2.50 |
Warrants Issued (in shares) | 7,000,000 |
Warrants Exercised (in shares) | (1,970,000) |
Warrants Outstanding (in shares) | 5,030,000 |
Warrants in connection with Horizon and Oxford loan agreement | |
Warrants | |
Exercise Price (in dollars per share) | $ / shares | $ 2.45 |
Warrants Issued (in shares) | 428,571 |
Warrants Exercised (in shares) | (267,857) |
Warrants Outstanding (in shares) | 160,714 |
Warrants in connection with CRG loan agreement | |
Warrants | |
Exercise Price (in dollars per share) | $ / shares | $ 7.37 |
Warrants Issued (in shares) | 394,289 |
Warrants Outstanding (in shares) | 394,289 |
Warrants in connection with CRG loan amendment in January 2018 | |
Warrants | |
Exercise Price (in dollars per share) | $ / shares | $ 10 |
Warrants Issued (in shares) | 1,248,250 |
Warrants Outstanding (in shares) | 1,248,250 |
Commitments and contingencies -
Commitments and contingencies - Commitments to Taro (Details) - Acquired product rights - Keveyis $ in Millions | 1 Months Ended | ||
Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($)installment | Dec. 31, 2019USD ($) | |
Other Commitments | |||
Number of installment payments | installment | 2 | ||
Installment payment | $ 7.5 | $ 1 | |
Potential milestone payments | 7.5 | ||
Minimum amount of purchases obligated | $ 29 | ||
Purchase obligation period | 6 years | ||
Remaining obligation | $ 19 |
Defined contribution plan (Deta
Defined contribution plan (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Defined contribution plan | |||
Percentage of employee's percentage contribution matched | 100.00% | ||
Percentage of employees' pay matched | 4.00% | ||
Amount contributed | $ 818 | $ 704 | $ 173 |
Income taxes - Components of in
Income taxes - Components of income (loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Components of income (loss) before income taxes | |||
Loss before income taxes | $ (47,683) | $ 32,387 | $ (111,712) |
Sweden | |||
Components of income (loss) before income taxes | |||
Loss before income taxes | (1,989) | 4,712 | (19,249) |
Ireland | |||
Components of income (loss) before income taxes | |||
Loss before income taxes | (23,708) | 73,409 | (47,211) |
Cayman Islands | |||
Components of income (loss) before income taxes | |||
Loss before income taxes | (1,587) | (701) | (21,709) |
U.S. | |||
Components of income (loss) before income taxes | |||
Loss before income taxes | $ (20,399) | $ (45,033) | $ (23,543) |
Income taxes - Components of _2
Income taxes - Components of income tax (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Components of income tax expense (benefit) | ||||||||
Current tax expense (benefit) | $ 1,768 | $ 536 | $ (187) | |||||
Change in valuation allowance | 17,182 | 3,081 | 7,617 | |||||
Deferred tax expense (benefit) | 1,958 | |||||||
Total tax expense (benefit) | $ 691 | $ 400 | $ 677 | $ 535 | $ 1 | 1,768 | 536 | 1,771 |
Income tax expense arising from intercompany interest income | 1,800 | |||||||
Sweden | ||||||||
Components of income tax expense (benefit) | ||||||||
Current tax expense (benefit) | 1,767 | 535 | ||||||
Deferred tax expense (benefit) | 12,395 | (4,586) | ||||||
Ireland | ||||||||
Components of income tax expense (benefit) | ||||||||
Current tax expense (benefit) | (22) | |||||||
Deferred tax expense (benefit) | (8,484) | (13,337) | 1,280 | |||||
U.S. | Federal | ||||||||
Components of income tax expense (benefit) | ||||||||
Current tax expense (benefit) | (151) | |||||||
Deferred tax expense (benefit) | (7,914) | (1,785) | 39 | |||||
U.S. | State | ||||||||
Components of income tax expense (benefit) | ||||||||
Current tax expense (benefit) | 1 | 1 | (14) | |||||
Deferred tax expense (benefit) | $ (784) | $ (354) | $ (2,392) |
Income taxes - Deferred taxes (
Income taxes - Deferred taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Deferred tax assets: | ||
Net operating loss carryforwards | $ 16,283 | $ 4,932 |
Stock based compensation | 6,811 | 4,944 |
Lease Liability | 404 | 107 |
Intangible Amortization | 628 | |
Other deferred activity | 250 | 497 |
Tax credits | 14,533 | 10,826 |
Interest disallowance | 9,687 | 9,889 |
Intangibles | 13,240 | 13,240 |
Total deferred tax assets | 61,836 | 44,435 |
Valuation allowance | (61,617) | (44,435) |
Deferred tax assets recognized | 219 | |
Deferred tax liabilities: | ||
Lease Liability - Right of Use | (219) | |
Total deferred tax liabilities | (219) | |
Net deferred tax assets | ||
Increase in valuation allowance | $ 17,200 | $ 2,700 |
Income taxes - Effective tax ra
Income taxes - Effective tax rate (Details) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Schedule of effective tax rate of our benefit for income taxes differs from the statutory rate | |||
Ireland statutory income tax rate | 12.50% | 12.50% | 12.50% |
Foreign tax differential between Sweden, U.S., Cayman Island and Ireland | 1.39% | 7.55% | 3.99% |
Federal tax credits | 7.77% | (4.58%) | |
Change in valuation allowance | (36.04%) | 9.51% | (6.82%) |
State income taxes | 1.64% | (1.09%) | 1.43% |
Permanent differences | 2.92% | 4.01% | (5.04%) |
Rate change - tax impact | (7.09%) | ||
Foreign exchange remeasurement of Swedish deferred tax asset | 0.83% | ||
Provision to return | 0.53% | 3.95% | (1.33%) |
Sale of subsidiary | (37.58%) | ||
Net operating loss adjustment | 5.57% | 7.72% | |
Other | (0.34%) | (0.06%) | |
Effective income tax rate | (3.72%) | 1.65% | (1.59%) |
Income taxes - NOLs (Details)
Income taxes - NOLs (Details) $ in Millions | Dec. 31, 2019USD ($) |
Sweden | |
Operating Loss Carryforwards | |
NOLs | $ 0 |
Ireland | |
Operating Loss Carryforwards | |
NOLs | 60.2 |
U.S. | Federal | |
Operating Loss Carryforwards | |
NOLs | 27 |
U.S. | State | |
Operating Loss Carryforwards | |
NOLs | $ 29.1 |
Income taxes - Tax credit carry
Income taxes - Tax credit carryforwards (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Sweden | |
Tax credit carryforward | |
Ownership change threshold (as a percent) | 50.00% |
U.S. | |
Tax credit carryforward | |
Ownership change threshold (as a percent) | 50.00% |
U.S. | Orphan drug tax credit carryforward | Federal | |
Tax credit carryforward | |
Tax credit carryforward | $ 14.3 |
U.S. | Research and development tax credit carryforward | Federal | |
Tax credit carryforward | |
Tax credit carryforward | $ 0.2 |
Ordinary shares - Voting rights
Ordinary shares - Voting rights and privileges (Details) | May 26, 2015$ / sharesshares | Dec. 31, 2019item$ / sharesshares | Dec. 31, 2019$ / sharesshares | Dec. 31, 2018$ / sharesshares | May 26, 2015€ / shares |
Voting rights and privileges | |||||
Ordinary shares, shares authorized | shares | 600,000,000 | 600,000,000 | 600,000,000 | ||
Ordinary shares, shares outstanding | shares | 54,205,852 | 54,205,852 | 54,122,074 | ||
Number of votes per ordinary share | item | 1 | ||||
Dividends declared (in dollars per share) | $ / shares | $ 0 | ||||
Dividends paid (in dollars per share) | $ / shares | 0 | ||||
Deferred shares, par value (in dollars/euro per share) | $ / shares | $ 1.098 | $ 1.098 | $ 1.098 | ||
Deferred Shares | |||||
Voting rights and privileges | |||||
Beneficial shares issued (in shares) | shares | 40,000 | ||||
Deferred shares, par value (in dollars/euro per share) | (per share) | $ 1.098 | € 1 | |||
Number of votes per deferred share | item | 0 |
Ordinary shares - Equity financ
Ordinary shares - Equity financings - 2018 (Details) - USD ($) $ / shares in Units, $ in Thousands | Dec. 18, 2018 | Feb. 26, 2018 | Jan. 25, 2018 | Dec. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 |
Equity transactions | ||||||
Proceeds from issuance of ordinary shares, net | $ 33,508 | $ 26,384 | ||||
Novo | ||||||
Equity transactions | ||||||
Aggregate purchase price | $ 36,700 | |||||
Additional gain on sale of subsidiary | $ 14,300 | |||||
Issuance of shares, Public offering | ||||||
Equity transactions | ||||||
Proceeds from issuance of ordinary shares, net | $ 1,600 | $ 31,700 | ||||
Ordinary Shares | ||||||
Equity transactions | ||||||
Issuance of shares to Novo (in shares) | 5,242,000 | |||||
Ordinary Shares | Novo | ||||||
Equity transactions | ||||||
Issuance of shares to Novo (in shares) | 5,242,000 | 5,200,000 | ||||
Price per share (in dollars per share) | $ 7 | $ 7 | $ 7 | |||
Ordinary Shares | Issuance of shares, Public offering | ||||||
Equity transactions | ||||||
Price per share (in dollars per share) | $ 6.75 | $ 6.75 | ||||
Issuance of shares, net of offering costs (in shares) | 255,683 | 5,000,000 | 5,255,683 |
Ordinary shares - Equity fina_2
Ordinary shares - Equity financings - 2017 (Details) - USD ($) $ in Thousands | Apr. 28, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2019 |
Equity transactions | ||||
Proceeds from issuance of ordinary shares, net | $ 33,508 | $ 26,384 | ||
ATM Facility | ||||
Equity transactions | ||||
Proceeds from issuance of ordinary shares, net | 8,600 | |||
Aggregate shares issuable (in dollars) | $ 40,000 | |||
Commission on gross proceeds from sale of shares (as a percent) | 3.00% | |||
Payment of fees on issuance of ordinary shares | $ 300 | |||
Amount available for sale | $ 31,100 | |||
Ordinary Shares | ATM Facility | ||||
Equity transactions | ||||
Issuance of shares, net of offering costs (in shares) | 1,281,903 | 10,300 |
Ordinary shares - Shares reserv
Ordinary shares - Shares reserved for issuance (Details) - shares | Dec. 31, 2019 | Dec. 31, 2018 |
Stock options | ||
Shares reserved for issuance | ||
Common stock reserved for future issuance (in shares) | 9,984,034 | 8,579,511 |
Warrants issued in private equity placement or loan agreement | ||
Shares reserved for issuance | ||
Common stock reserved for future issuance (in shares) | 6,833,253 |
Stock-based compensation - Gene
Stock-based compensation - General (Details) | Dec. 31, 2019shares |
Inducement Plan | |
Stock-based compensation | |
Number of shares available for issuance | 1,099,776 |
2015 Plan | |
Stock-based compensation | |
Number of shares available for issuance | 725,531 |
Non-Employee Director Plan | |
Stock-based compensation | |
Number of shares available for issuance | 0 |
Stock-based compensation - Stoc
Stock-based compensation - Stock options activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Summary of outstanding stock options | ||
Outstanding at beginning of period (in shares) | 8,579,511 | |
Granted (in shares) | 2,788,900 | |
Forfeited and cancelled (in shares) | (2,131,886) | |
Exercised (in shares) | (43,841) | |
Outstanding at end of period (in shares) | 9,192,684 | 8,579,511 |
Vested and exercisable at end of period (in shares) | 5,466,055 | |
Weighted-Average Exercise Price | ||
Granted (in dollars per share) | $ 3.85 | |
Forfeited and cancelled (in dollars per share) | 5.20 | |
Exercised (in dollars per share) | 4.12 | |
Outstanding (in dollars per share) | 6.58 | $ 7.35 |
Vested and exercisable at end of period (in dollars per share) | $ 7.69 | |
Additional Disclosures - Options | ||
Weighted Average Remaining Contractual Term, Outstanding | 5 years 11 months 16 days | 7 years 6 months 26 days |
Weighted Average Remaining Contractual Term, Vested and exercisable | 4 years 9 months 11 days | |
Aggregate Intrinsic Value, Outstanding (in dollars) | $ 164 | $ 3,281 |
Stock-based compensation - St_2
Stock-based compensation - Stock-based compensation expense (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Stock-based compensation expense | |||
Total stock-based compensation | $ 8,597,000 | $ 7,807,000 | $ 5,167,000 |
Stock options | |||
Stock-based compensation expense | |||
Compensation expense, Stock option modification | 179,000 | ||
Total unrecognized compensation expense | $ 9,200,000 | ||
Estimated weighted average period over which expense is expected to be recognized | 2 years 6 months 18 days | ||
Selling, general and administrative | |||
Stock-based compensation expense | |||
Total stock-based compensation | $ 6,552,000 | 6,012,000 | 4,027,000 |
Research and development | |||
Stock-based compensation expense | |||
Total stock-based compensation | $ 2,045,000 | $ 1,795,000 | $ 1,140,000 |
Stock-based compensation - Fair
Stock-based compensation - Fair value assumptions (Details) - Stock options | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Fair value assumptions | |||
Expected term (in years) | 5 years 6 months 26 days | 6 years 1 month 10 days | 5 years 11 months 23 days |
Minimum Risk-free interest rate (as a percent) | 1.38% | 2.25% | 1.78% |
Maximum Risk-free interest rate (as a percent) | 2.61% | 3.04% | 2.26% |
Minimum Expected volatility (as a percent) | 76.50% | 78.20% | 78.20% |
Maximum Expected volatility (as a percent) | 80.85% | 85.00% | 85.00% |
Stock-based compensation - Rest
Stock-based compensation - Restricted stock units (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Stock-based compensation | |||
Stock-based compensation | $ 8,597 | $ 7,807 | $ 5,167 |
RSUs | |||
Stock-based compensation | |||
Number of shares issued for each stock award vested | 1 | ||
Stock-based compensation | $ 1,400 | $ 500 | |
Total unrecognized compensation expense | $ 1,600 | ||
Estimated weighted average period over which expense is expected to be recognized | 1 year 22 days | ||
Summary of unvested RSUs | |||
Unvested - Beginning of period (in shares) | 143,100 | ||
Granted (in shares) | 1,001,000 | ||
Forfeited (in shares) | (283,500) | ||
Vested (in shares) | (69,250) | ||
Unvested - End of period (in shares) | 791,350 | 143,100 | |
RSUs | Employee | |||
Stock-based compensation | |||
Vesting period | 2 years | ||
RSUs | Director | |||
Stock-based compensation | |||
Vesting period | 1 year | ||
Service period | 1 year |
Segment and other information -
Segment and other information - Long-lived assets (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019USD ($)segment | Dec. 31, 2018USD ($) | |
Long-lived assets by location | ||
Property and equipment, net | $ 291 | $ 294 |
Number of operating segments | segment | 1 | |
U.S. | ||
Long-lived assets by location | ||
Property and equipment, net | $ 291 | $ 294 |
Segment and other information_2
Segment and other information - Customer concentration (Details) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Sales revenue | Customer A | Customer Concentration Risk | ||
Customer concentration | ||
Concentration (as a percent) | 100.00% | 92.00% |
Sale of subsidiary (Details)
Sale of subsidiary (Details) $ / shares in Units, $ in Thousands | Dec. 18, 2018USD ($)$ / sharesshares | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($)employee$ / sharesshares | Jan. 31, 2018USD ($) | Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($)$ / shares | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($) |
Sale of subsidiary | |||||||||||||||
Amortization of intangible assets | $ 1,256 | $ 1,255 | $ 1,255 | $ 1,256 | $ 1,670 | $ 1,876 | $ 1,872 | $ 1,769 | $ 5,022 | $ 7,187 | $ 5,022 | ||||
Ordinary Shares | |||||||||||||||
Sale of subsidiary | |||||||||||||||
Issuance of shares to Novo (in shares) | shares | 5,242,000 | ||||||||||||||
Macrilen | |||||||||||||||
Sale of subsidiary | |||||||||||||||
Acquired product rights, Additions | $ 24,800 | $ 24,834 | |||||||||||||
Amortization of intangible assets | 2,164 | ||||||||||||||
Net book value of finite-lived intangible asset | $ 22,600 | ||||||||||||||
Disposal Group, Disposed of by Sale, Not Discontinued Operations | Strongbridge Ireland Ltd. | |||||||||||||||
Sale of subsidiary | |||||||||||||||
Consideration for sale of subsidiary | $ 145,000 | $ 145,000 | $ 145,000 | ||||||||||||
Expenses on sale of subsidiary | $ 5,800 | ||||||||||||||
Novo | |||||||||||||||
Sale of subsidiary | |||||||||||||||
Additional gain on sale of subsidiary | $ 14,300 | ||||||||||||||
Termination payment | $ 6,000 | $ 6,000 | |||||||||||||
Novo | Ordinary Shares | |||||||||||||||
Sale of subsidiary | |||||||||||||||
Issuance of shares to Novo (in shares) | shares | 5,242,000 | 5,200,000 | |||||||||||||
Price per share (in dollars per share) | $ / shares | $ 7 | $ 7 | $ 7 | $ 7 | |||||||||||
Novo | Disposal Group, Disposed of by Sale, Not Discontinued Operations | Strongbridge Ireland Ltd. | |||||||||||||||
Sale of subsidiary | |||||||||||||||
Additional gain on sale of subsidiary | $ 14,300 | ||||||||||||||
NNI | Services Agreement | |||||||||||||||
Sale of subsidiary | |||||||||||||||
Number of employees funded by counterparty | employee | 23 | ||||||||||||||
Term of agreement | 3 years |
Quarterly consolidated financ_3
Quarterly consolidated financial information (unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Total revenues | $ 21,712 | $ 18,027 | $ 7,046 | ||||||||
Cost of sales (excluding amortization of intangible assets) | $ 986 | $ 1,001 | $ 1,022 | $ 813 | $ 1,125 | $ 1,441 | $ 753 | $ 667 | 3,822 | 3,986 | 1,483 |
Amortization of intangible assets | 1,256 | 1,255 | 1,255 | 1,256 | 1,670 | 1,876 | 1,872 | 1,769 | 5,022 | 7,187 | 5,022 |
Total costs and expenses | 19,999 | 20,358 | 20,921 | 18,683 | 24,108 | 26,763 | 20,663 | 17,243 | |||
Other (expense) income | 7,655 | 3,831 | 9,272 | (1,348) | 106,980 | 4,174 | 16,070 | (12,914) | 19,410 | 114,310 | (37,970) |
Income tax expense | (691) | (400) | (677) | (535) | (1) | (1,768) | (536) | (1,771) | |||
Net income (loss) | $ (8,980) | $ (13,790) | $ (8,247) | $ (18,434) | $ 84,056 | $ (20,559) | $ (2,923) | $ (28,723) | $ (49,451) | $ 31,851 | $ (113,483) |
Net (loss) income per ordinary share, basic (in dollars per share) | $ (0.17) | $ (0.25) | $ (0.15) | $ (0.34) | $ 1.73 | $ (0.44) | $ (0.06) | $ (0.66) | $ (0.91) | $ 0.69 | $ (3.11) |
Net (loss) income per ordinary share, diluted (in dollars per share) | $ (0.17) | $ (0.31) | $ (0.30) | $ (0.34) | $ 1.64 | $ (0.55) | $ (0.43) | $ (0.66) | $ (1.10) | $ 0.31 | $ (3.11) |
Product | |||||||||||
Total revenues | $ 5,593 | $ 5,677 | $ 6,073 | $ 4,333 | $ 4,514 | $ 5,347 | $ 4,296 | $ 3,870 | $ 21,676 | $ 18,027 | $ 7,046 |
Royalty | |||||||||||
Total revenues | $ 13 | $ 7 | $ 6 | $ 10 | $ 36 |