Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2023 | Apr. 28, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-39450 | |
Entity Registrant Name | HARMONY BIOSCIENCES HOLDINGS, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 82-2279923 | |
Entity Address, Address Line One | 630 W. | |
Entity Address, Address Line Two | Germantown Pike | |
Entity Address, Address Line Three | Suite 215 | |
Entity Address, City or Town | Plymouth Meeting | |
Entity Address, State or Province | PA | |
Entity Address, Postal Zip Code | 19462 | |
City Area Code | 484 | |
Local Phone Number | 539-9800 | |
Title of 12(b) Security | Common Stock, par value $0.00001 value per share | |
Trading Symbol | HRMY | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 59,954,618 | |
Entity Central Index Key | 0001802665 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
UNAUDITED CONDENSED CONSOLIDATE
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 287,962 | $ 243,784 |
Investments, short-term | 55,916 | 79,331 |
Trade receivables, net | 52,575 | 54,740 |
Inventory, net | 4,090 | 4,297 |
Prepaid expenses | 11,399 | 9,347 |
Other current assets | 6,145 | 8,786 |
Total current assets | 418,087 | 400,285 |
NONCURRENT ASSETS: | ||
Property and equipment, net | 470 | 573 |
Restricted cash | 750 | 750 |
Investments, long-term | 48,538 | 22,568 |
Intangible assets, net | 154,992 | 160,953 |
Deferred tax asset | 89,385 | 85,943 |
Other noncurrent assets | 2,870 | 2,798 |
Total noncurrent assets | 297,005 | 273,585 |
TOTAL ASSETS | 715,092 | 673,870 |
CURRENT LIABILITIES: | ||
Trade payables | 6,414 | 3,786 |
Accrued compensation | 5,691 | 11,532 |
Accrued expenses | 56,810 | 59,942 |
Current portion of long-term debt | 6,500 | 2,000 |
Other current liabilities | 9,948 | 1,624 |
Total current liabilities | 85,363 | 78,884 |
NONCURRENT LIABILITIES: | ||
Long-term debt, net | 185,063 | 189,647 |
Other noncurrent liabilities | 1,625 | 2,501 |
Total noncurrent liabilities | 186,688 | 192,148 |
TOTAL LIABILITIES | 272,051 | 271,032 |
COMMITMENTS AND CONTINGENCIES (Note 12) | ||
STOCKHOLDERS' EQUITY: | ||
Common stock-$0.00001 par value; 500,000,000 shares authorized at March 31, 2023 and December 31, 2022, respectively; 59,954,618 shares and 59,615,731 issued and outstanding at March 31, 2023 and December 31, 2022, respectively | 1 | 1 |
Additional paid in capital | 685,716 | 675,118 |
Accumulated other comprehensive income (loss) | (31) | (151) |
Accumulated deficit | (242,645) | (272,130) |
TOTAL STOCKHOLDERS' EQUITY | 443,041 | 402,838 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 715,092 | $ 673,870 |
UNAUDITED CONDENSED CONSOLIDA_2
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2023 | Dec. 31, 2022 |
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Common stock, par value | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 59,954,618 | 59,615,731 |
Common stock, shares outstanding | 59,954,618 | 59,615,731 |
UNAUDITED CONDENSED CONSOLIDA_3
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME | ||
Net product revenues | $ 119,126 | $ 85,313 |
Revenue from Contract with Customer, Product and Service [Extensible Enumeration] | us-gaap:ProductMember | us-gaap:ProductMember |
Cost of product sold | $ 20,780 | $ 14,716 |
Cost, Product and Service [Extensible Enumeration] | us-gaap:ProductMember | us-gaap:ProductMember |
Gross profit | $ 98,346 | $ 70,597 |
Operating expenses: | ||
Research and development | 13,289 | 7,578 |
Sales and marketing | 22,572 | 17,583 |
General and administrative | 22,062 | 17,880 |
Total operating expenses | 57,923 | 43,041 |
Operating income | 40,423 | 27,556 |
Other income (expense), net | 2 | (2) |
Interest expense, net | (2,645) | (4,169) |
Income before income taxes | 37,780 | 23,385 |
Income tax expense | (8,295) | (1,900) |
Net income | 29,485 | 21,485 |
Unrealized gain on investments | 120 | |
Comprehensive income | $ 29,605 | $ 21,485 |
EARNINGS PER SHARE: | ||
Basic | $ 0.49 | $ 0.36 |
Diluted | $ 0.48 | $ 0.35 |
Weighted average number of shares of common stock - basic | 59,732,157 | 58,908,526 |
Weighted average number of shares of common stock - diluted | 61,221,511 | 60,586,875 |
UNAUDITED CONDENSED CONSOLIDA_4
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock | Additional paid-in capital | Accumulated other comprehensive income (loss ) | Accumulated Deficit | Total |
Beginning balance at Dec. 31, 2021 | $ 1 | $ 640,104 | $ (453,598) | $ 186,507 | |
Beginning balance, shares at Dec. 31, 2021 | 58,825,769 | ||||
Net income | 21,485 | 21,485 | |||
Exercise of stock options | 1,883 | 1,883 | |||
Exercise of stock options, Shares | 204,379 | ||||
Stock-based compensation | 4,628 | 4,628 | |||
Ending balance at Mar. 31, 2022 | $ 1 | 646,615 | (432,113) | 214,503 | |
Ending balance, shares at Mar. 31, 2022 | 59,030,148 | ||||
Beginning balance at Dec. 31, 2022 | $ 1 | 675,118 | $ (151) | (272,130) | 402,838 |
Beginning balance, shares at Dec. 31, 2022 | 59,615,731 | ||||
Net income | 29,485 | 29,485 | |||
Unrealized loss on investments | 120 | 120 | |||
Exercise of options and restricted stock units | 3,395 | $ 3,395 | |||
Exercise of options and restricted stock units, Shares | 338,887 | ||||
Exercise of stock options, Shares | 324,301 | ||||
Stock-based compensation | 7,203 | $ 7,203 | |||
Ending balance at Mar. 31, 2023 | $ 1 | $ 685,716 | $ (31) | $ (242,645) | $ 443,041 |
Ending balance, shares at Mar. 31, 2023 | 59,954,618 |
UNAUDITED CONDENSED CONSOLIDA_5
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net income | $ 29,485 | $ 21,485 |
Adjustments to reconcile net income to net cash used in operating activities: | ||
Depreciation | 103 | 117 |
Intangible amortization | 5,961 | 5,082 |
Stock-based and employee stock purchase compensation expense | 7,203 | 4,628 |
Stock appreciation rights market adjustment | (642) | 268 |
Debt issuance costs amortization | 416 | 412 |
Deferred taxes | (3,442) | |
Amortization of premiums and accretion of discounts on Investment securities | (636) | |
Other non-cash expenses | 369 | 385 |
Change in operating assets and liabilities: | ||
Trade receivables | 2,165 | (3,290) |
Inventory | 207 | (165) |
Prepaid expenses and other assets | 592 | (2,235) |
Trade payables | 2,628 | 5,903 |
Accrued expenses and other current liabilities | (1,850) | (3,586) |
Other non-current liabilities | (152) | |
Net cash provided by operating activities | 42,559 | 28,852 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of investment securities | (47,776) | |
Proceeds from maturities and sales of investment securities | 45,986 | |
Purchase of property and equipment | (45) | |
Milestone payments | (40,000) | |
Net cash used in investing activities | (1,790) | (40,045) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Principal repayment of long term debt | (500) | (500) |
Proceeds from exercised options | 3,909 | 1,883 |
Net cash provided by financing activities | 3,409 | 1,383 |
NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH | 44,178 | (9,810) |
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH-Beginning of period | 244,534 | 235,059 |
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH-End of period | 288,712 | 225,249 |
Supplemental Disclosure of Cash Flow Information: | ||
Cash paid during the year for interest | $ 5,017 | $ 3,829 |
Organization and Description of
Organization and Description of Business | 3 Months Ended |
Mar. 31, 2023 | |
Organization and Description of Business | |
Organization and Description of Business | 1. ORGANIZATION AND DESCRIPTION OF BUSINESS The Company Harmony Biosciences Holdings, Inc., and its consolidated subsidiary (the “Company”) was founded in July 2017 as Harmony Biosciences II, LLC, a Delaware limited liability company. The Company converted to a Delaware corporation named Harmony Biosciences II, Inc. in September 2017 and, in February 2020, the Company changed its name to Harmony Biosciences Holdings, Inc. The Company’s operations are conducted in its wholly owned subsidiary, Harmony Biosciences, LLC (“Harmony”), which was formed in May 2017. The Company is a commercial-stage pharmaceutical company focused on developing and commercializing innovative therapies for patients living with rare neurological diseases as well as patients living with other neurological diseases who have unmet medical needs. The Company is headquartered in Plymouth Meeting, Pennsylvania. |
Liquidity and Capital Resources
Liquidity and Capital Resources | 3 Months Ended |
Mar. 31, 2023 | |
Liquidity And Capital Resources | |
Liquidity and Capital Resources | 2. The unaudited condensed consolidated financial statements have been prepared as though the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company had an accumulated deficit of $242,645 and $272,130, as of March 31, 2023 and December 31, 2022, respectively. As of March 31, 2023, the Company had cash, cash equivalents and investments of $392,416. The Company believes that its existing cash, cash equivalents and investments on hand as of March 31, 2023, as well as additional cash generated from operating and financing activities will meet its operational liquidity needs and fund its planned investing activities for the next twelve months from the date of issuance of these unaudited condensed consolidated financial statements. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2023 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 3. Basis of Presentation The unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and include all adjustments necessary for the fair presentation of the Company’s financial position for the periods presented. All intercompany accounts and transactions have been eliminated in consolidation. The unaudited condensed consolidated balance sheet as of March 31, 2023, the unaudited condensed consolidated statements of cash flows for the three months ended March 31, 2023, and 2022, and the unaudited condensed consolidated statements of operations and comprehensive income and the unaudited condensed consolidated statements of shareholders’ equity for the three months ended March 31, 2023 and 2022, are unaudited. The balance sheet as of March 31, 2023, was derived from audited financial statements as of and for the year ended December 31, 2022. The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited annual financial statements as of and for the year ended December 31, 2022, and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair presentation of the Company’s financial position as of March 31, 2023, and the results of its operations and its cash flows for the three months ended March 31, 2023 and 2022. The unaudited condensed consolidated results of operations are not necessarily indicative of the results that may occur for the full fiscal year. Certain information and disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted under the SEC’s rules and regulations. These unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements and accompanying notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts and disclosures in the unaudited condensed consolidated financial statements, including the notes thereto, and elsewhere in this report. Actual results may differ significantly from estimates, which include rebates due pursuant to commercial and government contracts, accrued research and development expenses, stock-based compensation expense and income taxes. Cash, Cash Equivalents and Restricted Cash Cash and cash equivalents and restricted cash consist of cash and, if applicable, highly liquid investments with an original maturity of three months or less when purchased, including investments in Money Market Funds and debt securities that approximate fair value. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the balance sheet that equal the amount reflected in the statements of cash flows. As of March 31, December 31, 2023 2022 Cash and cash equivalents $ 287,962 $ 243,784 Restricted cash 750 750 Total cash, cash equivalents, and restricted cash shown in the statements of cash flows $ 288,712 $ 244,534 Restricted cash includes amounts required to be held as a security deposit in the form of letters of credit for the Company’s credit card program and the fleet program. Investments The Company’s investments consist of debt securities that are classified as available-for-sale. Short-term and long-term investments are carried at fair value and unrealized gains and losses are recorded as a component of accumulated comprehensive income in stockholders’ equity. The amortization of premiums and accretion of discounts adjust the carrying value of investments and are recorded in interest expense, net, on the unaudited condensed consolidated statements of operations and comprehensive income. Interest income and realized gains and losses, if any, are also recorded in interest expense, net, on the unaudited condensed consolidated statement of operations and comprehensive income. Realized gains and losses that result from the sale of investments are determined on a specific identification basis. At each reporting period, the Company reviews any unrealized losses position to determine if the decline in the fair value of the underlying investments is a result of credit losses or other factors. If the assessment indicates that a credit loss exists, any impairment is recognized as an allowance for credit losses in our consolidated statement of operations. Concentrations of Risk Substantially all of the Company’s cash and money market funds are held in two financial institutions. Due to their size, the Company believes these financial institutions represent minimal credit risk. Deposits may exceed the amount of insurance provided on such deposits by the Federal Deposit Insurance Corporation for U.S. institutions. The Company has not experienced any losses on its deposits of cash and cash equivalents. The Company believes that it is not exposed to significant credit risk due to the financial position of the depository institutions in which those deposits are held. The Company is also subject to credit risk from its trade receivables related to its product sales. The Company extends credit to specialty pharmaceutical distribution companies within the United States. Customer creditworthiness is monitored and collateral is not required. Historically, the Company has not experienced credit losses on its accounts receivable. The Company monitors its exposure within accounts receivable and would record a reserve against uncollectible accounts receivable if necessary As of March 31, 2023, three customers accounted for 100% of gross accounts receivable; Accredo Health Group, Inc. (“Accredo”), which accounted for 41% of gross accounts receivable; Caremark LLC (“CVS Caremark”), which accounted for 30% of gross accounts receivable; and PANTHERx Specialty Pharmacy LLC (“Pantherx”), which accounted for 29% of gross accounts receivable. As of December 31, 2022, three customers accounted for 100% of gross accounts receivable; CVS Caremark, which accounted for 41% of gross accounts receivable, Accredo, which accounted for 35% of gross accounts receivable; and Pantherx, which accounted for 24% of gross accounts receivable. For the three months ended March 31, 2023, three customers accounted for 100% of gross product revenues; CVS Caremark accounted for 35% of gross product revenues; Pantherx accounted for 33% of gross product revenues; and Accredo accounted for 32% of gross product revenues. For the three months ended March 31, 2022, three customers accounted for 100% of gross product revenues; CVS Caremark accounted for 38% of gross product revenues; Pantherx accounted for 32% of gross product revenues; and Accredo accounted for 30% of gross product revenues. The Company depends on a single source supplier for each of its product and active pharmaceutical ingredient. Recently Issued Accounting Pronouncements ASU 2020-04, Reference Rate Reform (Topic 848). Reference Rate Reform (Topic 848) Reference Rate Reform |
Investments
Investments | 3 Months Ended |
Mar. 31, 2023 | |
Investments | |
Investments | 4. INVESTMENTS The carrying value and amortized cost of the Company’s available-for-sale debt securities, summarized by type of security, consisted of the following: March 31, 2023 Amortized Unrealized Unrealized Fair Cost Gains Losses Value Short-term: Commercial paper $ 24,106 8 (22) $ 24,092 Corporate debt securities 29,117 1 (49) 29,069 U.S. government securities 2,751 7 (3) 2,755 Total short-term investments $ 55,974 16 (74) $ 55,916 Long-term: Commercial paper $ 1,580 — — $ 1,580 Corporate debt securities 25,855 36 (66) 25,825 U.S. government securities 21,076 61 (4) 21,133 Total long-term investments $ 48,511 97 (70) $ 48,538 December 31, 2022 Amortized Unrealized Unrealized Fair Cost Gains Losses Value Short-term: Commercial paper $ 26,553 15 (34) $ 26,534 Corporate debt securities 49,213 9 (73) 49,149 U.S. government securities 3,658 — (10) 3,648 Total short-term investments $ 79,424 24 (117) $ 79,331 Long-term: Commercial paper $ 853 1 — $ 854 Corporate debt securities 21,516 11 (68) 21,459 U.S. government securities 257 — (2) 255 Total long-term investments $ 22,626 12 (70) $ 22,568 The Company classifies investments with an original maturity of less than one year as current and investments with an original maturity date of greater than one year as noncurrent on its unaudited condensed consolidated balance sheet. The investments classified as noncurrent have original maturity dates ranging from 1-2 years. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Measurements | |
Fair Value Measurements | 5. FAIR VALUE MEASUREMENTS The Company’s unaudited condensed consolidated financial statements include cash, cash equivalents, restricted cash, accounts payable, and accrued liabilities, all of which are short term in nature and, accordingly, approximate fair value. It is the Company’s policy to measure non-financial assets and liabilities at fair value on a nonrecurring basis. These non-financial assets and liabilities are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (such as evidence of impairment), which, if material, are disclosed in the accompanying footnotes. The Company measures certain assets and liabilities at fair value based on the fair value hierarchy that prioritizes inputs to valuation techniques used to measure fair value into three levels based on the source of inputs as follows: Level 1—Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities. Level 2—Valuations based on observable inputs and quoted prices in active markets for similar assets and liabilities. Level 3—Valuations based on unobservable inputs and models that are supported by little or no market activity. Money market funds are classified as Level 1 fair value instruments. Investments in available-for-sale debt securities are classified as Level 2 and carried at fair value, which we estimate utilizing a third-party pricing service. The pricing service utilizes industry standard valuation models whereby all significant inputs, including benchmark yields, reported trades, broker/dealer quotes, issuer spreads, bids, offers, or other market-related data, are observable. We validate valuations obtained from third-party services by obtaining market values from other pricing sources. The Company did not classify any assets or liabilities as Level 3 as of March 31, 2023 or December 31, 2022. The Company’s assets measured at fair value consisted of the following: March 31, 2023 December 31, 2022 Total Level 1 Level 2 Total Level 1 Level 2 Assets Cash equivalents $ 185,534 184,790 744 $ 184,977 184,977 — Commercial paper 25,672 — 25,672 27,388 — 27,388 Corporate debt securities 54,894 — 54,894 70,608 — 70,608 U.S. government securities 23,888 — 23,888 3,903 — 3,903 Total $ 289,988 184,790 105,198 $ 286,876 184,977 101,899 |
Inventory
Inventory | 3 Months Ended |
Mar. 31, 2023 | |
Inventory | |
Inventory | 6. INVENTORY Inventory, net consisted of the following: As of March 31, December 31, 2023 2022 Raw materials $ 776 $ 838 Work in process 1,690 1,513 Finished goods 2,243 2,565 Inventory, gross 4,709 4,916 Reserve for excess inventory (619) (619) Total inventory, net $ 4,090 $ 4,297 |
Intangible Assets
Intangible Assets | 3 Months Ended |
Mar. 31, 2023 | |
Intangible Assets | |
Intangible Assets | 7. INTANGIBLE ASSETS In August 2019, the Company received FDA approval of WAKIX ® In October 2020, the Company received FDA approval for the New Drug Application (“NDA”) for WAKIX for the treatment of cataplexy in adult patients with narcolepsy. This event triggered a milestone payment of $100,000 under the provisions of the 2017 LCA which the Company capitalized as an intangible asset and paid in January of 2021. The Company determined a useful life of 9 years for such intangible asset, and, as of March 31, 2023, the remaining useful life was 6.5 years. In February 2022, the Company attained $500,000 in life-to-date aggregate net sales of WAKIX in the United States. This event triggered a final $40,000 payment under the provisions of the 2017 LCA which the Company capitalized as an intangible asset and paid in March of 2022. The Company determined a useful life of 7.6 years for such intangible asset, and, as of March 31, 2023, the remaining useful life was 6.5 years. Amortization expense was $5,961 and $5,082 for the three months ended March 31, 2023 and 2022, respectively, and is recorded in general and administrative expenses on the unaudited condensed consolidated statements of operations and comprehensive income. The Company expects the future annual amortization expense for the unamortized intangible assets to be as follows: Years ending December 31, 2023 (Excluding the three months ended March 31, 2023) $ 17,884 2024 23,845 2025 23,845 2026 23,845 2027 23,845 Thereafter 41,728 Total $ 154,992 The gross carrying amount and net book value of the intangible asset is as follows: As of March 31, December 31, 2023 2022 Gross Carrying Amount $ 215,000 $ 215,000 Accumulated Amortization (60,008) (54,047) Net Book Value $ 154,992 $ 160,953 |
License Agreements and Asset Pu
License Agreements and Asset Purchase Agreements | 3 Months Ended |
Mar. 31, 2023 | |
License Agreements and Asset Purchase Agreements | |
License Agreements and Asset Purchase Agreements | 8. LICENSE AGREEMENTS AND ASSET PURCHASE AGREEMENTS License Agreements In July 2017, Harmony entered into a License Agreement (the “2017 LCA”) with Bioprojet Société Civile de Recherche (“Bioprojet”) whereby Harmony acquired the exclusive right to commercialize the pharmaceutical compound pitolisant for the treatment, and/or prevention, of narcolepsy, obstructive sleep apnea, idiopathic hypersomnia, and Parkinson’s disease as well as any other indications unanimously agreed by the parties in the United States and its territories. A milestone payment of $50,000 was due upon acceptance by the FDA of pitolisant’s NDA, which was achieved in February 2019 and was expensed within research and development for the year ended December 31, 2019. A milestone payment of $77,000, which included a $2,000 fee that is described below, was due upon FDA approval of WAKIX (pitolisant) for treatment of EDS in adult patients with narcolepsy, which was achieved in August 2019. The $2,000 payment and $75,000 milestone payment were paid in August and November 2019, respectively. In addition, a milestone payment of $102,000, which included a $2,000 fee was due upon the FDA approval of the NDA for WAKIX for the treatment of cataplexy in adult patients with narcolepsy. The $2,000 payment was paid in October 2020 and a $100,000 milestone payment was paid in January 2021. A final $40,000 milestone payment was paid to Bioprojet in March 2022 upon WAKIX attaining $500,000 in aggregate net sales in the United States. The 2017 LCA also requires a fixed trademark royalty and a tiered royalty based on net sales, which is payable to Bioprojet on a quarterly basis. The Company incurred $19,060 and $13,672 for the three months ended March 31, 2023 and 2022, respectively, for sales-based, trademark and tiered royalties recognized as cost of product sold. As of March 31, 2023 and December 31, 2022, the Company had accrued $19,060 and $25,367, respectively, for sales-based, trademark and tiered royalties. On July 31, 2022, Harmony entered into a License and Commercialization Agreement (the “2022 LCA”) with Bioprojet whereby Harmony obtained exclusive rights to manufacture, use and commercialize one or more new products based on pitolisant in the United States and Latin America, with the potential to add additional indications and formulations upon agreement of both parties. Harmony paid an initial, non-refundable $30,000 licensing fee in October 2022 and additional payments of up to $155,000 are potentially due under the 2022 LCA upon the achievement of certain future development and sales-based milestones. In addition, there are other payments due upon achievement of development milestones for new indications and formulations as agreed upon by both parties. The 2022 LCA also requires a fixed trademark royalty and a tiered royalty based on net sales upon commercialization, which will be payable to Bioprojet on a quarterly basis. Agreement Related to Intellectual Property In August 2021, the Company entered into an asset purchase agreement with ConSynance Therapeutics, Inc. (the “APA”) to acquire HBS-102 (formerly referred to as “CSTI-100”), a potential first-in-class molecule with a novel mechanism of action. Under the terms of the APA, the Company acquired full development and commercialization rights globally, with the exception of Greater China, for $3,500. The Company accounted for the transaction as an asset acquisition as substantially all of the fair value of the assets acquired was concentrated in a single identified asset. In March 2023, the Company achieved a preclinical milestone, which triggered a $750 payment under the provisions of the APA, which the Company recognized as an IPR&D charge recorded in research and development within the unaudited condensed consolidated statement of operations and comprehensive income for the three months ended March 31, 2023. There are additional payments due under the APA upon the achievement of certain milestones including $1,000 for preclinical milestones, $19,000 for development milestones, $44,000 for regulatory milestones and $110,000 for sales milestones. |
Accrued Expenses
Accrued Expenses | 3 Months Ended |
Mar. 31, 2023 | |
Accrued Expenses | |
Accrued Expenses | 9. ACCRUED EXPENSES Accrued expenses consist of the following: As of March 31, December 31, 2023 2022 Royalties due to third parties $ 19,060 $ 25,367 Rebates and other sales deductions 28,933 27,860 Interest 3,831 3,286 Selling and marketing 1,358 1,135 Research and development 1,075 358 Professional fees, consulting, and other services 708 1,163 Other expenses 1,845 773 $ 56,810 $ 59,942 |
Debt
Debt | 3 Months Ended |
Mar. 31, 2023 | |
Debt | |
Debt | 10. DEBT Blackstone Credit Agreement In August 2021, the Company entered into the Blackstone Credit Agreement that provides for (i) a senior secured term loan facility in an aggregate original principal amount of $200,000 (the “Initial Term Loan”) and (ii) a senior secured delayed draw term loan facility in an aggregate principal amount up to $100,000 (the “DDTL” and, together with the Initial Term Loan, the “Loans”). The DDTL was initially available to draw down through August 9, 2022. In August 2022, the Company entered into an agreement to extend the expiration date of the DDTL to August 9, 2023, for which the Company will pay a ticking fee at a rate of 1% per annum on the undrawn portion of the DDTL, which commenced on August 10, 2022. The repayment schedule for the Initial Term Loan consists of quarterly $500 principal payments, which commenced on December 31, 2021, and increasing to quarterly $5,000 principal payments beginning on March 31, 2024, with a $145,500 payment due on the maturity date of August 9, 2026 (“Maturity Date”). Interest is payable quarterly, which commenced on November 9, 2021, and continues through the Maturity Date. The Initial Term Loan bears interest at a per annum rate equal to LIBOR, subject to a 1.00% floor, plus 6.50%. Long-term debt, net consists of the following: March 31, December 31, 2023 2022 Liability component - principal $ 197,000 $ 197,500 Unamortized debt discount associated with debt financing costs (5,437) (5,853) Liability component - net carrying value 191,563 191,647 Less current portion (6,500) (2,000) Long-term debt, net $ 185,063 $ 189,647 Future minimum payments relating to long-term debt, net as of March 31, 2023, for the periods indicated below consists of the following: Years ending December 31, 2023 (Excluding the three months ended March 31, 2023) $ 1,500 2024 20,000 2025 20,000 2026 155,500 2027 — Thereafter — Total $ 197,000 Interest expense related to the Company’s long-term debt, net, is included in interest expense, net in the unaudited condensed consolidated statements of operations and comprehensive income and consists of the following: Three Months Ended March 31, 2023 2022 Interest on principal balance $ 5,315 $ 3,824 Amortization of deferred financing costs 416 412 Total term loan interest expense $ 5,731 $ 4,236 |
Leases
Leases | 3 Months Ended |
Mar. 31, 2023 | |
Leases | |
Leases | 11. LEASES In June 2018, the Company entered into an operating lease for approximately fifteen thousand square feet of office space in Plymouth Meeting, PA, which expires in May 2024. The Company subsequently entered two separate operating leases for additional office space in Plymouth Meeting, PA, which include approximately thirteen thousand square feet and seven thousand square feet of additional office space, respectively, and expire in May 2024. The terms of the lease payments provide for rental payments on a monthly basis and on a graduated scale. The Company also leases a fleet of automobiles that are used by its sales representatives and are classified as operating leases. Operating lease right-of-use assets and operating lease liabilities are recognized based on the present value of the future lease payments using our incremental borrowing rate. Leases with an initial term of 12 months or less are not recorded on the balance sheet. Our leases have remaining lease terms of less than 1 year to 3 years, some of which may include the option to extend or terminate the leases. The Company recorded operating lease costs of $378 and $385 for the three months ended March 31, 2023 and 2022, respectively. As of March 31, 2023, the weighted-average remaining lease term for operating leases was 1.5 years and the weighted-average discount rate for operating leases was 4.6%. Supplemental balance sheet information related to operating leases was as follows: Leases Classification March 31, 2023 December 31, 2022 Assets Operating lease right-of-use assets Other noncurrent assets $ 2,384 $ 2,312 Liabilities Operating lease liability, current portion Other current liabilities $ 1,874 $ 1,614 Operating lease liability, long-term Other long-term liabilities 741 975 Total operating lease liabilities $ 2,615 $ 2,589 Supplemental cash flow information related to operating leases was as follows: March 31, 2023 March 31, 2022 Operating cash flows from operating leases $ 428 $ 434 Right of use assets obtained in exchange for operating lease obligations $ 526 $ 234 Future payments under noncancelable operating leases with initial terms of one year or more as of March 31, 2023 consisted of the following: Years ending December 31, 2023 (Excluding the three months ended March 31, 2023) $ 1,462 2024 1,102 2025 143 2026 10 2027 — Thereafter — Total lease payments 2,717 Less: imputed interest (102) Total lease liabilities $ 2,615 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies. | |
Commitments and Contingencies | 12. COMMITMENTS AND CONTINGENCIES Litigation From time to time, the Company is subject to claims and suits arising in the ordinary course of business. The Company accrues such liabilities when they are known, if they are deemed probable and can be reasonably estimated. As of March 31, 2023, there were no material claims or suits outstanding. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2023 | |
Stockholders' Equity | |
Stockholders' Equity | 13. STOCKHOLDERS’ EQUITY Common Stock The holders of common stock are entitled to one vote for each share held on all matters submitted to a vote of the Company’s stockholders. The holders of common stock do not have any cumulative voting rights. Holders of common stock are entitled to receive ratably any dividends declared by the Company’s board of directors out of funds legally available for that purpose, subject to any preferential dividend rights of any outstanding preferred stock. The Company’s common stock has no preemptive rights, conversion rights or other subscription rights or redemption or sinking fund provisions. |
Stock Incentive Plan and Stock-
Stock Incentive Plan and Stock-based Compensation | 3 Months Ended |
Mar. 31, 2023 | |
Stock Incentive Plan and Stock-based Compensation | |
Stock Incentive Plan and Stock-based Compensation | 14. STOCK INCENTIVE PLAN AND STOCK-BASED COMPENSATION 2020 Stock Incentive Plan In connection with the Company’s IPO, the board of directors adopted, and its stockholders approved, the 2020 Incentive Award Plan (the “2020 Plan”), in order to facilitate the grant of cash and equity incentives to directors, employees (including the Company’s named executive officers) and consultants of the Company and its subsidiaries. The 2020 Plan provides for the grant of stock options, including incentive stock options (“ISOs”) and non-qualified stock options (“NSOs”), SARs, restricted stock, dividend equivalents, restricted stock units (“RSUs”) and other stock or cash-based awards. Stock options and stock appreciation rights under the 2020 Plan have a 10-year contractual term and vest over the vesting period specified in the applicable award agreement, at achievement of a performance requirement, or upon change of control (as defined in the applicable plan). RSUs vest over the vesting period specified in the applicable award agreement, at achievement of a performance requirement, or upon change of control (as defined in the applicable plan). As of March 31, 2023, there were 4,647,087 shares of common stock available for issuance under the 2020 Plan. The number of shares that may be issued under the 2020 Plan will automatically increase on January 1 of each year in an amount equal to the lesser of (i) 4.0% of the shares of the Company’s common stock outstanding on December 31 of the preceding year or (ii) an amount determined by the Company’s board of directors. 2017 Stock Incentive Plan In August 2017, the Company adopted an equity incentive plan (the “2017 Plan”). Under the 2017 Plan, directors, officers, employees, consultants, and advisors of the Company can be paid incentive compensation measured by the value of the Company’s shares of common stock through grants of stock options, stock appreciation rights (“SARs”), or restricted stock. Following the adoption of the 2020 Plan, no further grants have been, or will be, made under the 2017 Plan. However, the 2017 Plan will continue to govern the terms and conditions of outstanding awards granted under it. Stock Options The following table summarizes stock option activity for the three months ended March 31, 2023: Weighted- Weighted- Average Average Remaining Number of Exercise Contractual Awards Price Term Awards outstanding—December 31, 2022 6,460,947 $ 30.90 7.86 Awards issued 99,797 $ 41.52 Awards exercised (324,301) $ 12.06 Awards forfeited (158,798) $ 21.61 Awards outstanding—March 31, 2023 6,077,645 $ 32.32 7.77 Stock Appreciation Rights The following table summarizes SARs activity for the three months ended March 31, 2023: Weighted- Weighted- Average Average Remaining Number of Exercise Contractual Awards Price Term Awards outstanding—December 31, 2022 43,208 $ 9.38 6.32 Awards issued — $ — Awards exercised — $ — Awards forfeited — $ — Awards outstanding—March 31, 2023 43,208 $ 9.38 6.08 Restricted Stock Units The following table summarizes RSU activity for the three months ended March 31, 2023: Weighted- Weighted- Average Average Remaining Number of Grant Date Contractual Awards Fair Value Term Awards outstanding—December 31, 2022 60,000 $ 29.03 8.24 Awards issued — $ — Awards vested (30,000) $ 29.03 Awards forfeited — $ — Awards outstanding—March 31, 2023 30,000 $ 29.03 7.99 As of March 31, 2023 and December 31, 2022, stock awards issued under the 2017 and 2020 Plans of 2,219,090 and 1,818,045 shares of common stock, respectively, were vested. Value of Stock Options and SARs The Company values options and SARs using the Black-Scholes option-pricing model. The Company lacks sufficient historical company-specific volatility information. Therefore, the Company estimates expected stock volatility based on historical volatility of peer companies and expects to continue to do so until such time as it has adequate historical data regarding the volatility of its own traded stock price. For options with service-based vesting conditions, the expected term of the Company’s stock options has been determined utilizing the “simplified” method for awards that qualify as “plain-vanilla” options. For SARs, the expected term is based upon the weighting of certain future events. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for the time periods approximately equal to the expected term of the award. An expected dividend yield of 0% is based on the fact that the Company has never paid cash dividends and does not expect to do so in the foreseeable future. The assumptions used to value the awards are summarized in the following table. As of March 31, December 31, 2023 2022 Dividend yield 0.00 % 0.00 % Expected volatility 76.32 % 72.57 - 77.08 % Risk-free interest rate 3.55 - 3.63 % 1.99 - 4.05 % Lack of marketability discount 0.00 % 0.00 % Expected term (years) 2.9 - 6.3 3.1 - 6.3 Value of RSUs The fair value of RSUs is equal to the value of the Company’s common stock on the grant date. The weighted average per share fair value of awards issued under the 2017 Plan and 2020 Plan was $19.83 and $18.88 on March 31, 2023 and December 31, 2022, respectively. Stock-Based Compensation Expense Stock-based compensation expense, net for the three months ended March 31, 2023 and 2022, was recorded in the unaudited condensed consolidated statements of operations and comprehensive income in the following line items: Three Months Ended March 31, 2023 2022 Research and development expense $ 976 $ 518 Sales and marketing expense 1,073 976 General and administrative expense 4,512 3,402 $ 6,561 $ 4,896 Stock-based compensation expense, net related to options and RSUs issued under the 2017 Plan and 2020 Plan is included in stockholder’s equity, and a liability for SARs is included in other non-current liabilities, in the Company’s unaudited condensed consolidated balance sheet. As of March 31, 2023, the total unrecognized stock-based compensation expense related to options and RSUs was $77,333. Such amount will be recognized in the Company’s consolidated statement of operations over a weighted average period of 2.8 years. Employee Stock Purchase Plan The 2020 Employee Stock Purchase Plan (“ESPP”) was adopted by the Company’s Board of Directors on April 30, 2021. The ESPP permits eligible employees to purchase shares of the Company’s common stock at a 15% discount from the lesser of the fair market value per share of the Company’s common stock on the first day of the offering period or the fair market value of the Company’s common stock on the purchase date. Funds are collected from employees through after-tax payroll deductions. The total number of shares reserved for issuance under the ESPP was initially 629,805, which will automatically increase on January 1 of each year in an amount equal to the lesser of (i) 1.0% of the shares of the Company’s common stock outstanding on December 31 of the preceding year or (ii) an amount determined by the Company’s board of directors. It is intended that the ESPP meet the requirements for an “employee stock purchase plan” under Section 423 of the Internal Revenue Code. There were no shares issued under the ESPP for each of the three months ended March 31, 2023 and 2022. The discount on the ESPP was $105 and $94 for the three months ended March 31, 2023 and 2022, respectively, and is recorded within stock-based compensation expense. |
Earnings per Share
Earnings per Share | 3 Months Ended |
Mar. 31, 2023 | |
Earnings per Share | |
Earnings per Share | 15. EARNINGS PER SHARE Basic earnings per share is calculated by dividing net income by the weighted average number of shares of common stock outstanding. Diluted net income per common share is computed under the treasury stock method by using the weighted average number of shares of common stock outstanding, plus, for periods with net income, the potential dilutive effects of stock options, stock appreciation rights and restricted stock units. The following table sets forth the computation of basic and diluted net income per share: Three Months Ended March 31, 2023 2022 Numerator Net income $ 29,485 $ 21,485 Denominator Net income per common share - basic $ 0.49 $ 0.36 Net income per common share - diluted $ 0.48 $ 0.35 Weighted average number of shares of common stock - basic 59,732,157 58,908,526 Weighted average number of shares of common stock - diluted 61,221,511 60,586,875 Securities outstanding that were included in the computation above, utilizing the treasury stock method are as follows: Three Months Ended March 31, 2023 2022 Stock options, SARs, and RSUs to purchase common stock 1,489,354 1,678,349 Potential shares of common stock issuable that were excluded from the computation of diluted weighted-average shares outstanding excluded from the numerator, are as follows: Three Months Ended March 31, 2023 2022 Stock options, SARs, and RSUs to purchase common stock 4,661,499 5,249,666 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2023 | |
Income Taxes | |
Income Taxes | 16. INCOME TAXES The reasons for the difference between the statutory federal income tax rate and the Company’s effective income tax rate for the three months ended March 31, 2023 and 2022 are as follows: Three Months Ended March 31, 2023 2022 Federal income tax rate 21.0 % 21.0 % Stock-based compensation (2.8) (3.8) State taxes 6.3 6.4 Credits (2.9) — Other 0.4 — Valuation allowance — (15.5) Total 22.0 % 8.1 % |
Related-party Transactions
Related-party Transactions | 3 Months Ended |
Mar. 31, 2023 | |
Related-party Transactions | |
Related-party Transactions | 17. RELATED-PARTY TRANSACTIONS The Company was party to a management agreement for professional services provided by a related party, Paragon Biosciences, LLC (“Paragon”). The related party is an entity that shares common ownership with the Company. In addition, the Chairman of the Company’s board of directors was the President and owner of the entity. The Company terminated the management agreement upon the consummation of its IPO. The Company is also party to a right of use agreement with the related party whereby it has access to and the right to use certain office space leased by the related party in Chicago, IL. In addition, the Company had participated in certain transactions with separate related parties that also share common ownership with the Company, primarily related to combined employee health plans. The Company incurred $71 for each of the three months ended March 31, 2023 and 2022, in expenses to this related party, which are included in general and administrative expense in the unaudited condensed consolidated statements of operations and comprehensive loss. As of March 31, 2023 and December 31, 2022, there were no amounts due to or due from related parties included in the unaudited condensed consolidated balance sheets. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and include all adjustments necessary for the fair presentation of the Company’s financial position for the periods presented. All intercompany accounts and transactions have been eliminated in consolidation. The unaudited condensed consolidated balance sheet as of March 31, 2023, the unaudited condensed consolidated statements of cash flows for the three months ended March 31, 2023, and 2022, and the unaudited condensed consolidated statements of operations and comprehensive income and the unaudited condensed consolidated statements of shareholders’ equity for the three months ended March 31, 2023 and 2022, are unaudited. The balance sheet as of March 31, 2023, was derived from audited financial statements as of and for the year ended December 31, 2022. The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited annual financial statements as of and for the year ended December 31, 2022, and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair presentation of the Company’s financial position as of March 31, 2023, and the results of its operations and its cash flows for the three months ended March 31, 2023 and 2022. The unaudited condensed consolidated results of operations are not necessarily indicative of the results that may occur for the full fiscal year. Certain information and disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted under the SEC’s rules and regulations. These unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements and accompanying notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts and disclosures in the unaudited condensed consolidated financial statements, including the notes thereto, and elsewhere in this report. Actual results may differ significantly from estimates, which include rebates due pursuant to commercial and government contracts, accrued research and development expenses, stock-based compensation expense and income taxes. |
Cash, Cash Equivalents and Restricted Cash | Cash, Cash Equivalents and Restricted Cash Cash and cash equivalents and restricted cash consist of cash and, if applicable, highly liquid investments with an original maturity of three months or less when purchased, including investments in Money Market Funds and debt securities that approximate fair value. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the balance sheet that equal the amount reflected in the statements of cash flows. As of March 31, December 31, 2023 2022 Cash and cash equivalents $ 287,962 $ 243,784 Restricted cash 750 750 Total cash, cash equivalents, and restricted cash shown in the statements of cash flows $ 288,712 $ 244,534 Restricted cash includes amounts required to be held as a security deposit in the form of letters of credit for the Company’s credit card program and the fleet program. |
Investments | Investments The Company’s investments consist of debt securities that are classified as available-for-sale. Short-term and long-term investments are carried at fair value and unrealized gains and losses are recorded as a component of accumulated comprehensive income in stockholders’ equity. The amortization of premiums and accretion of discounts adjust the carrying value of investments and are recorded in interest expense, net, on the unaudited condensed consolidated statements of operations and comprehensive income. Interest income and realized gains and losses, if any, are also recorded in interest expense, net, on the unaudited condensed consolidated statement of operations and comprehensive income. Realized gains and losses that result from the sale of investments are determined on a specific identification basis. At each reporting period, the Company reviews any unrealized losses position to determine if the decline in the fair value of the underlying investments is a result of credit losses or other factors. If the assessment indicates that a credit loss exists, any impairment is recognized as an allowance for credit losses in our consolidated statement of operations. |
Concentrations of Risk | Concentrations of Risk Substantially all of the Company’s cash and money market funds are held in two financial institutions. Due to their size, the Company believes these financial institutions represent minimal credit risk. Deposits may exceed the amount of insurance provided on such deposits by the Federal Deposit Insurance Corporation for U.S. institutions. The Company has not experienced any losses on its deposits of cash and cash equivalents. The Company believes that it is not exposed to significant credit risk due to the financial position of the depository institutions in which those deposits are held. The Company is also subject to credit risk from its trade receivables related to its product sales. The Company extends credit to specialty pharmaceutical distribution companies within the United States. Customer creditworthiness is monitored and collateral is not required. Historically, the Company has not experienced credit losses on its accounts receivable. The Company monitors its exposure within accounts receivable and would record a reserve against uncollectible accounts receivable if necessary As of March 31, 2023, three customers accounted for 100% of gross accounts receivable; Accredo Health Group, Inc. (“Accredo”), which accounted for 41% of gross accounts receivable; Caremark LLC (“CVS Caremark”), which accounted for 30% of gross accounts receivable; and PANTHERx Specialty Pharmacy LLC (“Pantherx”), which accounted for 29% of gross accounts receivable. As of December 31, 2022, three customers accounted for 100% of gross accounts receivable; CVS Caremark, which accounted for 41% of gross accounts receivable, Accredo, which accounted for 35% of gross accounts receivable; and Pantherx, which accounted for 24% of gross accounts receivable. For the three months ended March 31, 2023, three customers accounted for 100% of gross product revenues; CVS Caremark accounted for 35% of gross product revenues; Pantherx accounted for 33% of gross product revenues; and Accredo accounted for 32% of gross product revenues. For the three months ended March 31, 2022, three customers accounted for 100% of gross product revenues; CVS Caremark accounted for 38% of gross product revenues; Pantherx accounted for 32% of gross product revenues; and Accredo accounted for 30% of gross product revenues. The Company depends on a single source supplier for each of its product and active pharmaceutical ingredient. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements ASU 2020-04, Reference Rate Reform (Topic 848). Reference Rate Reform (Topic 848) Reference Rate Reform |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Summary of Significant Accounting Policies | |
Schedule of reconciliation of cash, cash equivalents, and restricted cash | The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the balance sheet that equal the amount reflected in the statements of cash flows. As of March 31, December 31, 2023 2022 Cash and cash equivalents $ 287,962 $ 243,784 Restricted cash 750 750 Total cash, cash equivalents, and restricted cash shown in the statements of cash flows $ 288,712 $ 244,534 |
Investments (Tables)
Investments (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Investments | |
Schedule of carrying value and amortized cost of available-for-sale debt securities | The carrying value and amortized cost of the Company’s available-for-sale debt securities, summarized by type of security, consisted of the following: March 31, 2023 Amortized Unrealized Unrealized Fair Cost Gains Losses Value Short-term: Commercial paper $ 24,106 8 (22) $ 24,092 Corporate debt securities 29,117 1 (49) 29,069 U.S. government securities 2,751 7 (3) 2,755 Total short-term investments $ 55,974 16 (74) $ 55,916 Long-term: Commercial paper $ 1,580 — — $ 1,580 Corporate debt securities 25,855 36 (66) 25,825 U.S. government securities 21,076 61 (4) 21,133 Total long-term investments $ 48,511 97 (70) $ 48,538 December 31, 2022 Amortized Unrealized Unrealized Fair Cost Gains Losses Value Short-term: Commercial paper $ 26,553 15 (34) $ 26,534 Corporate debt securities 49,213 9 (73) 49,149 U.S. government securities 3,658 — (10) 3,648 Total short-term investments $ 79,424 24 (117) $ 79,331 Long-term: Commercial paper $ 853 1 — $ 854 Corporate debt securities 21,516 11 (68) 21,459 U.S. government securities 257 — (2) 255 Total long-term investments $ 22,626 12 (70) $ 22,568 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Measurements | |
Schedule of assets measured at fair value | The Company’s assets measured at fair value consisted of the following: March 31, 2023 December 31, 2022 Total Level 1 Level 2 Total Level 1 Level 2 Assets Cash equivalents $ 185,534 184,790 744 $ 184,977 184,977 — Commercial paper 25,672 — 25,672 27,388 — 27,388 Corporate debt securities 54,894 — 54,894 70,608 — 70,608 U.S. government securities 23,888 — 23,888 3,903 — 3,903 Total $ 289,988 184,790 105,198 $ 286,876 184,977 101,899 |
Inventory (Tables)
Inventory (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Inventory | |
Schedule of inventory net | Inventory, net consisted of the following: As of March 31, December 31, 2023 2022 Raw materials $ 776 $ 838 Work in process 1,690 1,513 Finished goods 2,243 2,565 Inventory, gross 4,709 4,916 Reserve for excess inventory (619) (619) Total inventory, net $ 4,090 $ 4,297 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Intangible Assets | |
Schedule of expected future annual amortization expense for unamortized intangible assets | The Company expects the future annual amortization expense for the unamortized intangible assets to be as follows: Years ending December 31, 2023 (Excluding the three months ended March 31, 2023) $ 17,884 2024 23,845 2025 23,845 2026 23,845 2027 23,845 Thereafter 41,728 Total $ 154,992 |
Schedule of gross carrying amount and net book value of intangible assets | The gross carrying amount and net book value of the intangible asset is as follows: As of March 31, December 31, 2023 2022 Gross Carrying Amount $ 215,000 $ 215,000 Accumulated Amortization (60,008) (54,047) Net Book Value $ 154,992 $ 160,953 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Accrued Expenses | |
Schedule of accrued expenses | Accrued expenses consist of the following: As of March 31, December 31, 2023 2022 Royalties due to third parties $ 19,060 $ 25,367 Rebates and other sales deductions 28,933 27,860 Interest 3,831 3,286 Selling and marketing 1,358 1,135 Research and development 1,075 358 Professional fees, consulting, and other services 708 1,163 Other expenses 1,845 773 $ 56,810 $ 59,942 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Debt | |
Schedule of long-term debt, net | Long-term debt, net consists of the following: March 31, December 31, 2023 2022 Liability component - principal $ 197,000 $ 197,500 Unamortized debt discount associated with debt financing costs (5,437) (5,853) Liability component - net carrying value 191,563 191,647 Less current portion (6,500) (2,000) Long-term debt, net $ 185,063 $ 189,647 |
Schedule of future minimum payments relating to long term debt | Future minimum payments relating to long-term debt, net as of March 31, 2023, for the periods indicated below consists of the following: Years ending December 31, 2023 (Excluding the three months ended March 31, 2023) $ 1,500 2024 20,000 2025 20,000 2026 155,500 2027 — Thereafter — Total $ 197,000 |
Schedule of interest expense related to long term debt | Interest expense related to the Company’s long-term debt, net, is included in interest expense, net in the unaudited condensed consolidated statements of operations and comprehensive income and consists of the following: Three Months Ended March 31, 2023 2022 Interest on principal balance $ 5,315 $ 3,824 Amortization of deferred financing costs 416 412 Total term loan interest expense $ 5,731 $ 4,236 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Leases | |
Schedule of supplemental balance sheet and cash flow information related to operating leases | Supplemental balance sheet information related to operating leases was as follows: Leases Classification March 31, 2023 December 31, 2022 Assets Operating lease right-of-use assets Other noncurrent assets $ 2,384 $ 2,312 Liabilities Operating lease liability, current portion Other current liabilities $ 1,874 $ 1,614 Operating lease liability, long-term Other long-term liabilities 741 975 Total operating lease liabilities $ 2,615 $ 2,589 Supplemental cash flow information related to operating leases was as follows: March 31, 2023 March 31, 2022 Operating cash flows from operating leases $ 428 $ 434 Right of use assets obtained in exchange for operating lease obligations $ 526 $ 234 |
Schedule of future payments under noncancelable operating leases | Future payments under noncancelable operating leases with initial terms of one year or more as of March 31, 2023 consisted of the following: Years ending December 31, 2023 (Excluding the three months ended March 31, 2023) $ 1,462 2024 1,102 2025 143 2026 10 2027 — Thereafter — Total lease payments 2,717 Less: imputed interest (102) Total lease liabilities $ 2,615 |
Stock Incentive Plan and Stoc_2
Stock Incentive Plan and Stock-based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Stock Incentive Plan and Stock-based Compensation | |
Summary of changes in stock options granted | The following table summarizes stock option activity for the three months ended March 31, 2023: Weighted- Weighted- Average Average Remaining Number of Exercise Contractual Awards Price Term Awards outstanding—December 31, 2022 6,460,947 $ 30.90 7.86 Awards issued 99,797 $ 41.52 Awards exercised (324,301) $ 12.06 Awards forfeited (158,798) $ 21.61 Awards outstanding—March 31, 2023 6,077,645 $ 32.32 7.77 |
Summary of changes in SARs granted | The following table summarizes SARs activity for the three months ended March 31, 2023: Weighted- Weighted- Average Average Remaining Number of Exercise Contractual Awards Price Term Awards outstanding—December 31, 2022 43,208 $ 9.38 6.32 Awards issued — $ — Awards exercised — $ — Awards forfeited — $ — Awards outstanding—March 31, 2023 43,208 $ 9.38 6.08 |
Summary of changes in RSUs granted | The following table summarizes RSU activity for the three months ended March 31, 2023: Weighted- Weighted- Average Average Remaining Number of Grant Date Contractual Awards Fair Value Term Awards outstanding—December 31, 2022 60,000 $ 29.03 8.24 Awards issued — $ — Awards vested (30,000) $ 29.03 Awards forfeited — $ — Awards outstanding—March 31, 2023 30,000 $ 29.03 7.99 |
Summary of assumptions used to value awards | The assumptions used to value the awards are summarized in the following table. As of March 31, December 31, 2023 2022 Dividend yield 0.00 % 0.00 % Expected volatility 76.32 % 72.57 - 77.08 % Risk-free interest rate 3.55 - 3.63 % 1.99 - 4.05 % Lack of marketability discount 0.00 % 0.00 % Expected term (years) 2.9 - 6.3 3.1 - 6.3 |
Summary of stock-based compensation expense | Stock-based compensation expense, net for the three months ended March 31, 2023 and 2022, was recorded in the unaudited condensed consolidated statements of operations and comprehensive income in the following line items: Three Months Ended March 31, 2023 2022 Research and development expense $ 976 $ 518 Sales and marketing expense 1,073 976 General and administrative expense 4,512 3,402 $ 6,561 $ 4,896 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Earnings per Share | |
Summary of computation of basic and diluted net income (loss) per share | The following table sets forth the computation of basic and diluted net income per share: Three Months Ended March 31, 2023 2022 Numerator Net income $ 29,485 $ 21,485 Denominator Net income per common share - basic $ 0.49 $ 0.36 Net income per common share - diluted $ 0.48 $ 0.35 Weighted average number of shares of common stock - basic 59,732,157 58,908,526 Weighted average number of shares of common stock - diluted 61,221,511 60,586,875 |
Summary of antidilutive securities excluded from computation of earnings per share | Securities outstanding that were included in the computation above, utilizing the treasury stock method are as follows: Three Months Ended March 31, 2023 2022 Stock options, SARs, and RSUs to purchase common stock 1,489,354 1,678,349 Potential shares of common stock issuable that were excluded from the computation of diluted weighted-average shares outstanding excluded from the numerator, are as follows: Three Months Ended March 31, 2023 2022 Stock options, SARs, and RSUs to purchase common stock 4,661,499 5,249,666 |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Income Taxes | |
Schedule of difference between statutory federal income tax rate | Three Months Ended March 31, 2023 2022 Federal income tax rate 21.0 % 21.0 % Stock-based compensation (2.8) (3.8) State taxes 6.3 6.4 Credits (2.9) — Other 0.4 — Valuation allowance — (15.5) Total 22.0 % 8.1 % |
Liquidity and Capital Resourc_2
Liquidity and Capital Resources (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Liquidity And Capital Resources | ||
Accumulated deficit | $ 242,645 | $ 272,130 |
Cash, cash equivalents and investments | $ 392,416 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Schedule of Reconciliation of Cash, Cash Equivalents, and Restricted Cash (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 | Dec. 31, 2021 |
Summary of Significant Accounting Policies | ||||
Cash and cash equivalents | $ 287,962 | $ 243,784 | ||
Restricted cash | 750 | 750 | ||
Total cash, cash equivalents, and restricted cash shown in the statements of cash flows | $ 288,712 | $ 244,534 | $ 225,249 | $ 235,059 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Additional Information (Details) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 customer Institution | Mar. 31, 2022 customer | Dec. 31, 2022 customer | |
Summary Of Significant Accounting Policies [Line Items] | |||
Number Of financial institutions | Institution | 2 | ||
Three Customers | Accounts Receivable | Customer Concentration Risk | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Number of customers | 3 | 3 | |
Concentration risk percentage | 100% | 100% | |
Three Customers | Product Revenues | Customer Concentration Risk | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Number of customers | 3 | 3 | |
Concentration risk percentage | 100% | 100% | |
Caremark LLC | Accounts Receivable | Customer Concentration Risk | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Concentration risk percentage | 30% | 41% | |
Caremark LLC | Product Revenues | Customer Concentration Risk | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Concentration risk percentage | 35% | 38% | |
PANTHERx Specialty Pharmacy LLC | Accounts Receivable | Customer Concentration Risk | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Concentration risk percentage | 29% | 24% | |
PANTHERx Specialty Pharmacy LLC | Product Revenues | Customer Concentration Risk | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Concentration risk percentage | 33% | 32% | |
Accredo Health Group, Inc | Accounts Receivable | Customer Concentration Risk | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Concentration risk percentage | 41% | 35% | |
Accredo Health Group, Inc | Product Revenues | Customer Concentration Risk | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Concentration risk percentage | 32% | 30% |
Investments - Carrying Value an
Investments - Carrying Value and Amortized Cost of Available-For-Sale Debt Securities (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | |
Minimum | ||
Investment securities | ||
Non current investment maturity term | 1 year | |
Maximum | ||
Investment securities | ||
Non current investment maturity term | 2 years | |
Short-term | ||
Investment securities | ||
Amortized cost | $ 55,974 | $ 79,424 |
Unrealized Gains | 16 | 24 |
Unrealized Losses | (74) | (117) |
Fair Value | 55,916 | 79,331 |
Short-term commercial paper | ||
Investment securities | ||
Amortized cost | 24,106 | 26,553 |
Unrealized Gains | 8 | 15 |
Unrealized Losses | (22) | (34) |
Fair Value | 24,092 | 26,534 |
Short-term corporate debt securities | ||
Investment securities | ||
Amortized cost | 29,117 | 49,213 |
Unrealized Gains | 1 | 9 |
Unrealized Losses | (49) | (73) |
Fair Value | 29,069 | 49,149 |
Short-term U.S. government securities | ||
Investment securities | ||
Amortized cost | 2,751 | 3,658 |
Unrealized Gains | 7 | |
Unrealized Losses | (3) | (10) |
Fair Value | 2,755 | 3,648 |
Long-term | ||
Investment securities | ||
Amortized cost | 48,511 | 22,626 |
Unrealized Gains | 97 | 12 |
Unrealized Losses | (70) | (70) |
Fair Value | 48,538 | 22,568 |
Long-term commercial paper | ||
Investment securities | ||
Amortized cost | 1,580 | 853 |
Unrealized Gains | 1 | |
Fair Value | 1,580 | 854 |
Long-term corporate debt securities | ||
Investment securities | ||
Amortized cost | 25,855 | 21,516 |
Unrealized Gains | 36 | 11 |
Unrealized Losses | (66) | (68) |
Fair Value | 25,825 | 21,459 |
Long-term U.S. government securities | ||
Investment securities | ||
Amortized cost | 21,076 | 257 |
Unrealized Gains | 61 | |
Unrealized Losses | (4) | (2) |
Fair Value | $ 21,133 | $ 255 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets Measured at Fair Value (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Assets | ||
Assets | $ 289,988 | $ 286,876 |
Cash equivalents | ||
Assets | ||
Assets | 185,534 | 184,977 |
Commercial paper | ||
Assets | ||
Assets | 25,672 | 27,388 |
Corporate debt securities | ||
Assets | ||
Assets | 54,894 | 70,608 |
U.S. government securities | ||
Assets | ||
Assets | 23,888 | 3,903 |
Level 1 | ||
Assets | ||
Assets | 184,790 | 184,977 |
Level 1 | Cash equivalents | ||
Assets | ||
Assets | 184,790 | 184,977 |
Level 2 | ||
Assets | ||
Assets | 105,198 | 101,899 |
Level 2 | Cash equivalents | ||
Assets | ||
Assets | 744 | |
Level 2 | Commercial paper | ||
Assets | ||
Assets | 25,672 | 27,388 |
Level 2 | Corporate debt securities | ||
Assets | ||
Assets | 54,894 | 70,608 |
Level 2 | U.S. government securities | ||
Assets | ||
Assets | $ 23,888 | $ 3,903 |
Inventory (Details)
Inventory (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Inventory | ||
Raw materials | $ 776 | $ 838 |
Work in process | 1,690 | 1,513 |
Finished goods | 2,243 | 2,565 |
Inventory, gross | 4,709 | 4,916 |
Reserve for excess inventory | (619) | (619) |
Total inventory, net | $ 4,090 | $ 4,297 |
Intangible Assets - Additional
Intangible Assets - Additional Information (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | ||||
Mar. 31, 2022 | Feb. 28, 2022 | Jan. 31, 2021 | Aug. 31, 2019 | Mar. 31, 2023 | Mar. 31, 2022 | |
Intangible Assets | ||||||
Amortization expense | $ 5,961 | $ 5,082 | ||||
Net product revenues | $ 119,126 | $ 85,313 | ||||
WAKIX | ||||||
Intangible Assets | ||||||
Final payment paid | $ 40,000 | |||||
Useful life of intangible asset | 7 years 7 months 6 days | |||||
Remaining useful life | 6 years 6 months | |||||
WAKIX | United States | ||||||
Intangible Assets | ||||||
Net product revenues | $ 500,000 | |||||
WAKIX | Daytime Sleepiness | ||||||
Intangible Assets | ||||||
License agreement milestone payments paid | $ 75,000 | |||||
Useful life of intangible asset | 10 years | |||||
Remaining useful life | 6 years 6 months | |||||
NDA for WAKIX. | Cataplexy | ||||||
Intangible Assets | ||||||
License agreement milestone payments paid | $ 100,000 | |||||
Useful life of intangible asset | 9 years | |||||
Remaining useful life | 6 years 6 months |
Intangible Assets - Schedule of
Intangible Assets - Schedule of Expected Future Annual Amortization Expense for Unamortized Intangible Assets (Details) $ in Thousands | Mar. 31, 2023 USD ($) |
Future annual amortization expense | |
2023 (Excluding the three months ended March 31, 2023) | $ 17,884 |
2024 | 23,845 |
2025 | 23,845 |
2026 | 23,845 |
2027 | 23,845 |
Thereafter | 41,728 |
Total | $ 154,992 |
Intangible Assets - Schedule _2
Intangible Assets - Schedule of Gross Carrying Amount and Net Book Value of Intangible Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Intangible Assets | ||
Gross Carrying Amount | $ 215,000 | $ 215,000 |
Accumulated Amortization | (60,008) | (54,047) |
Net Book Value | $ 154,992 | $ 160,953 |
License Agreements and Asset _2
License Agreements and Asset Purchase Agreements (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | |||||||||
Mar. 31, 2023 | Jul. 31, 2022 | Aug. 31, 2021 | Jan. 31, 2021 | Oct. 31, 2020 | Nov. 30, 2019 | Aug. 31, 2019 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | Feb. 28, 2019 | |
License Agreements and Asset Purchase Agreements | |||||||||||
Cost of product sold | $ 20,780 | $ 14,716 | |||||||||
Accrued Sales Based Trademark and Royalties | $ 19,060 | 19,060 | $ 25,367 | ||||||||
All Countries Excluding Greater China | HBS-102 | Asset Purchase Agreement with ConSynance Therapeutics | |||||||||||
License Agreements and Asset Purchase Agreements | |||||||||||
Consideration transferred | $ 3,500 | ||||||||||
Payment for intellectual property upon preclinical milestones | 1,000 | ||||||||||
Payment for intellectual property upon developmental milestones | 19,000 | ||||||||||
Payment for intellectual property upon regulatory milestones | 44,000 | ||||||||||
Payment for intellectual property upon sales milestones | $ 110,000 | ||||||||||
All Countries Excluding Greater China | HBS-102 | Asset Purchase Agreement with ConSynance Therapeutics | Research and Development Expense | |||||||||||
License Agreements and Asset Purchase Agreements | |||||||||||
Payment related to achievement of preclinical milestone. | 750,000 | ||||||||||
Bioprojet | |||||||||||
License Agreements and Asset Purchase Agreements | |||||||||||
Licensing agreement milestone fees | $ 2,000 | ||||||||||
License agreement milestone payments paid | $ 75,000 | 2,000 | |||||||||
License agreement, additional milestone payment due | 102,000 | ||||||||||
Accrued Sales Based Trademark and Royalties | $ 19,060 | 19,060 | $ 25,367 | ||||||||
Bioprojet | Upon Acceptance by FDA of Pitolisant's | |||||||||||
License Agreements and Asset Purchase Agreements | |||||||||||
License agreement, milestone payment due | $ 50,000 | ||||||||||
License agreement, upfront non-refundable licensing fees paid | $ 30,000 | ||||||||||
License agreement, maximum additional milestone payment due | $ 155,000 | ||||||||||
Bioprojet | Upon FDA Approval of WAKIX | |||||||||||
License Agreements and Asset Purchase Agreements | |||||||||||
License agreement, milestone payment due | 77,000 | ||||||||||
Licensing agreement milestone fees | $ 2,000 | ||||||||||
License agreement milestone payments paid | $ 100,000 | $ 2,000 | |||||||||
Bioprojet | Sales-based, trademark and tiered royalties | |||||||||||
License Agreements and Asset Purchase Agreements | |||||||||||
Cost of product sold | 19,060 | $ 13,672 | |||||||||
Bioprojet | United States | |||||||||||
License Agreements and Asset Purchase Agreements | |||||||||||
Amount of Aggregate Net Sales Attaining | 500,000 | ||||||||||
Bioprojet | Attaining $500,000 Aggregate Net Sales | United States | Upon FDA Approval of WAKIX | |||||||||||
License Agreements and Asset Purchase Agreements | |||||||||||
Final payment paid | $ 40,000 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Accrued Expenses | ||
Royalties due to third parties | $ 19,060 | $ 25,367 |
Rebates and other sales deductions | 28,933 | 27,860 |
Interest | 3,831 | 3,286 |
Selling and marketing | 1,358 | 1,135 |
Research and development | 1,075 | 358 |
Professional fees, consulting, and other services | 708 | 1,163 |
Other expenses | 1,845 | 773 |
Accrued expenses | $ 56,810 | $ 59,942 |
Debt - Additional Information (
Debt - Additional Information (Details) - Blackstone Alternative Credit Advisors ("Blackstone") - USD ($) $ in Thousands | 1 Months Ended | ||
Aug. 10, 2022 | Aug. 31, 2021 | Mar. 31, 2023 | |
Senior Secured Term Loan | |||
DEBT | |||
Aggregate principal amount | $ 200,000 | ||
Debt issuance costs | 8,151 | ||
Cash proceeds received | $ 191,849 | ||
Term of loan | 5 years | ||
Fair value of loan | $ 168,569 | ||
Senior Secured Term Loan | Repayment of Debt Commencing on December 31, 2021 | |||
DEBT | |||
Periodic payment principal | $ 500 | ||
Senior Secured Term Loan | Repayment of Debt Beginning on March 31, 2024 | |||
DEBT | |||
Periodic payment principal | 5,000 | ||
Senior Secured Term Loan | Repayment of Debt Due on Maturity Date | |||
DEBT | |||
Periodic payment principal | $ 145,500 | ||
Senior Secured Term Loan | LIBOR | |||
DEBT | |||
Basis spread on variable rate | 6.50% | ||
Senior Secured Term Loan | LIBOR | Minimum | |||
DEBT | |||
Basis spread on variable rate | 1% | ||
Senior Secured Delayed Draw Term Loan | |||
DEBT | |||
Aggregate principal amount | $ 100,000 | ||
Percentage of ticking fee | 1% | ||
Debt issuance costs | $ 1,000 |
Debt - Balances of Long-term De
Debt - Balances of Long-term Debt, Net (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Debt | ||
Liability component - principal | $ 197,000 | $ 197,500 |
Unamortized debt discount associated with debt financing costs | (5,437) | (5,853) |
Liability component - net carrying value | 191,563 | 191,647 |
Less current portion | (6,500) | (2,000) |
Long-term debt, net | $ 185,063 | $ 189,647 |
Debt - Future Minimum Payments
Debt - Future Minimum Payments (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Future minimum payments | ||
2023 (Excluding the three months ended March 31, 2023) | $ 1,500 | |
2024 | 20,000 | |
2025 | 20,000 | |
2026 | 155,500 | |
Total | $ 197,000 | $ 197,500 |
Debt - Interest Expense (Detail
Debt - Interest Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Debt | ||
Interest on principal balance | $ 5,315 | $ 3,824 |
Amortization of deferred financing costs | 416 | 412 |
Total term loan interest expense | $ 5,731 | $ 4,236 |
Leases (Details)
Leases (Details) ft² in Thousands, $ in Thousands | 1 Months Ended | 3 Months Ended | |
Jun. 30, 2018 ft² | Mar. 31, 2023 USD ($) | Mar. 31, 2022 USD ($) | |
LEASES | |||
Operating lease square feet of office space | 15 | ||
Additional office space leased one | 13 | ||
Additional office space leased two | 7 | ||
Lessee, Operating Lease, Existence of Option to Extend [true false] | true | ||
Lessee, Operating Lease, Existence of Option to Terminate [true false] | true | ||
Cost operating lease | $ | $ 378 | $ 385 | |
Weighted average remaining lease term | 1 year 6 months | ||
Weighted-average discount rate for operating leases | 4.60% | ||
Minimum | |||
LEASES | |||
Lease terms | 1 year | ||
Maximum | |||
LEASES | |||
Lease terms | 3 years |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Assets | ||
Operating lease right-of-use assets | $ 2,384 | $ 2,312 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Other Assets Noncurrent | Other Assets Noncurrent |
Liabilities | ||
Operating lease liability, current portion | $ 1,874 | $ 1,614 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Other Liabilities Current | Other Liabilities Current |
Operating lease liability, long-term | $ 741 | $ 975 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other Liabilities Noncurrent | Other Liabilities Noncurrent |
Total operating lease liabilities | $ 2,615 | $ 2,589 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Leases | ||
Operating cash flows from operating leases | $ 428 | $ 434 |
Right of use assets obtained in exchange for operating lease obligations | $ 526 | $ 234 |
Leases - Future Payments (Detai
Leases - Future Payments (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Years ending December 31, | ||
2023 (Excluding the three months ended March 31, 2023) | $ 1,462 | |
2024 | 1,102 | |
2025 | 143 | |
2026 | 10 | |
Total lease payments | 2,717 | |
Less: imputed interest | (102) | |
Total operating lease liabilities | $ 2,615 | $ 2,589 |
Commitments and Contingencies (
Commitments and Contingencies (Details) | Mar. 31, 2023 claim |
Commitments and Contingencies. | |
Claims or suits outstanding | 0 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) | 3 Months Ended |
Mar. 31, 2023 | |
Stockholders' Equity | |
Common Stock Voting Rights | one vote for each share |
Stock Incentive Plan and Stoc_3
Stock Incentive Plan and Stock-based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Apr. 30, 2021 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Stock Incentive Plan and Stock-based Compensation | ||||
Unrecognized stock-based compensation expense | $ 77,333 | |||
Weighted average period | 2 years 9 months 18 days | |||
Restricted Stock Units | ||||
Stock Incentive Plan and Stock-based Compensation | ||||
Weighted average per share fair value of awards issued (in USD per share) | $ 19.83 | $ 18.88 | ||
2020 Plan | ||||
Stock Incentive Plan and Stock-based Compensation | ||||
Stock options contractual term | 10 years | |||
Percentage of increment of common stock outstanding | 4% | |||
Total number of shares available for issuance | 4,647,087 | |||
2017 and 2020 Plans | Common Stock | ||||
Stock Incentive Plan and Stock-based Compensation | ||||
Stock vested | 2,219,090 | 1,818,045 | ||
Employee Stock Purchase Plan | ||||
Stock Incentive Plan and Stock-based Compensation | ||||
Percentage of increment of common stock outstanding | 1% | |||
ESPP permits eligible employees to purchase shares of common stock at discount | 15% | |||
Total number of shares available for issuance | 629,805 | |||
Shares issued under the ESPP | 0 | 0 | ||
Amount of discount on ESSP | $ 105 | $ 94 |
Stock Incentive Plan and Stoc_4
Stock Incentive Plan and Stock-based Compensation - Summary of Changes in Stock Options Granted (Details) - $ / shares | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Stock Incentive Plan and Stock-based Compensation | ||
Number of Awards, Awards outstanding, Beginning balance | 6,460,947 | |
Number of Awards, Awards issued | 99,797 | |
Number of Awards, Awards exercised | (324,301) | |
Number of Awards, Awards forfeited | (158,798) | |
Number of Awards, Awards outstanding, Ending balance | 6,077,645 | 6,460,947 |
Weighted-Average Exercise Price, Awards outstanding, Beginning balance | $ 30.90 | |
Weighted-Average Exercise Price, Awards issued | 41.52 | |
Weighted-Average Exercise Price, Awards exercised | 12.06 | |
Weighted-Average Exercise Price, Awards forfeited | 21.61 | |
Weighted-Average Exercise Price, Awards outstanding, Ending balance | $ 32.32 | $ 30.90 |
Weighted-Average Remaining Contractual Term | 7 years 9 months 7 days | 7 years 10 months 9 days |
Stock Incentive Plan and Stoc_5
Stock Incentive Plan and Stock-based Compensation - Summary of Changes in SARs Granted (Details) - Stock Appreciation Rights - $ / shares | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Number of Awards, Awards outstanding, Beginning balance | 43,208 | |
Number of Awards, Awards outstanding, Ending balance | 43,208 | 43,208 |
Weighted-Average Exercise Price, Awards outstanding, Beginning balance | $ 9.38 | |
Weighted-Average Exercise Price, Awards outstanding, Ending balance | $ 9.38 | $ 9.38 |
Weighted-Average Remaining Contractual Term | 6 years 29 days | 6 years 3 months 25 days |
Stock Incentive Plan and Stoc_6
Stock Incentive Plan and Stock-based Compensation - Summary of Changes in RSUs Granted (Details) - Restricted Stock Units - $ / shares | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Number of Awards, Awards outstanding, Beginning balance | 60,000 | |
Number of Awards, Awards vested | (30,000) | |
Number of Awards, Awards outstanding, Ending balance | 30,000 | 60,000 |
Weighted-Average Exercise Price, Awards outstanding, Beginning balance | $ 29.03 | |
Weighted-Average Exercise Price, Awards vested | 29.03 | |
Weighted-Average Exercise Price, Awards outstanding, Ending balance | $ 29.03 | $ 29.03 |
Weighted-Average Remaining Contractual Term | 7 years 11 months 26 days | 8 years 2 months 26 days |
Stock Incentive Plan and Stoc_7
Stock Incentive Plan and Stock-based Compensation - Summary of Assumptions Used to Value Awards (Details) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Dividend yield | 0% | 0% |
Expected volatility | 76.32% | |
Expected volatility, minimum | 72.57% | |
Expected volatility, maximum | 77.08% | |
Risk-free interest rate, minimum | 3.55% | 1.99% |
Risk-free interest rate, maximum | 3.63% | 4.05% |
Lack of marketability discount | 0% | 0% |
Minimum | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Expected term (years) | 2 years 10 months 24 days | 3 years 1 month 6 days |
Maximum | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Expected term (years) | 6 years 3 months 18 days | 6 years 3 months 18 days |
Stock Incentive Plan and Stoc_8
Stock Incentive Plan and Stock-based Compensation - Summary of Stock-based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | $ 6,561 | $ 4,896 |
Research and Development Expense | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | 976 | 518 |
Sales and Marketing Expense | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | 1,073 | 976 |
General and Administrative Expense | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | $ 4,512 | $ 3,402 |
Earnings per Share - Summary of
Earnings per Share - Summary of Computation of Basic and Diluted Net Income (Loss) per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Numerator | ||
Net income | $ 29,485 | $ 21,485 |
Denominator | ||
Net income per common share - basic | $ 0.49 | $ 0.36 |
Net income per common share - diluted | $ 0.48 | $ 0.35 |
Weighted average number of shares of common stock - basic | 59,732,157 | 58,908,526 |
Weighted average number of shares of common stock - diluted | 61,221,511 | 60,586,875 |
Earnings per Share - Summary _2
Earnings per Share - Summary of Securities Outstanding Included in Computation above, Utilizing Treasury Stock Method (Details) - shares | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Stock options, SARs, and RSUs to purchase common stock | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Total | 1,489,354 | 1,678,349 |
Earnings per Share - Summary _3
Earnings per Share - Summary of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Stock options, SARs, and RSUs to purchase common stock | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Total | 4,661,499 | 5,249,666 |
Income Taxes - Schedule of Diff
Income Taxes - Schedule of Difference Between Statutory Federal Income Tax Rate (Details) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Taxes | ||
Federal income tax rate | 21% | 21% |
Stock-based compensation | (2.80%) | (3.80%) |
State taxes | 6.30% | 6.40% |
Credits | (2.90%) | |
Other | 0.40% | |
Valuation allowance | (15.50%) | |
Total | 22% | 8.10% |
Related-party Transactions (Det
Related-party Transactions (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Related-party Transactions | |||
Amounts due to or due from related parties | $ 0 | $ 0 | |
Management Services Agreement | General and Administrative Expense | |||
Related-party Transactions | |||
Management fee expense and other expenses to related party | $ 71 | $ 71 |