Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2020 | Jul. 29, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q2 | |
Trading Symbol | HRTX | |
Entity Registrant Name | HERON THERAPEUTICS, INC. /DE/ | |
Entity Central Index Key | 0000818033 | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 90,855,254 | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity File Number | 001-33221 | |
Entity Tax Identification Number | 94-2875566 | |
Entity Address, Address Line One | 4242 Campus Point Court | |
Entity Address, Address Line Two | Suite 200 | |
Entity Address, City or Town | San Diego | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92121 | |
City Area Code | 858 | |
Local Phone Number | 251-4400 | |
Entity Interactive Data Current | Yes | |
Entity Incorporation, State or Country Code | DE | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Title of 12(b) Security | Common Stock, par value $0.01 per share | |
Security Exchange Name | NASDAQ |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Current Period Unaudited) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 80,728 | $ 71,898 |
Short-term investments | 220,114 | 319,074 |
Accounts receivable, net | 37,502 | 39,879 |
Inventory | 41,442 | 24,968 |
Prepaid expenses and other current assets | 13,109 | 23,245 |
Total current assets | 392,895 | 479,064 |
Property and equipment, net | 21,886 | 19,618 |
Right-of-use lease assets | 17,594 | 13,754 |
Other assets | 346 | 346 |
Total assets | 432,721 | 512,782 |
Current liabilities: | ||
Accounts payable | 18,458 | 2,758 |
Accrued clinical and manufacturing liabilities | 30,173 | 34,614 |
Accrued payroll and employee liabilities | 11,193 | 15,248 |
Other accrued liabilities | 23,728 | 36,535 |
Current lease liabilities | 2,830 | 1,926 |
Convertible notes payable to related parties, net of discount | 6,269 | 5,624 |
Total current liabilities | 92,651 | 96,705 |
Non-current lease liabilities | 16,012 | 12,242 |
Total liabilities | 108,663 | 108,947 |
Stockholders’ equity: | ||
Common stock | 908 | 903 |
Additional paid-in capital | 1,594,436 | 1,568,317 |
Accumulated other comprehensive income | 953 | 85 |
Accumulated deficit | (1,272,239) | (1,165,470) |
Total stockholders’ equity | 324,058 | 403,835 |
Total liabilities and stockholders’ equity | $ 432,721 | $ 512,782 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Revenues: | ||||
Net product sales | $ 22,668 | $ 36,659 | $ 48,068 | $ 68,261 |
Operating expenses: | ||||
Cost of product sales | 9,005 | 13,588 | 19,627 | 28,550 |
Research and development | 44,004 | 41,425 | 80,898 | 84,397 |
General and administrative | 9,819 | 9,778 | 20,241 | 19,426 |
Sales and marketing | 15,589 | 23,647 | 35,785 | 52,367 |
Total operating expenses | 78,417 | 88,438 | 156,551 | 184,740 |
Loss from operations | (55,749) | (51,779) | (108,483) | (116,479) |
Other income, net | 559 | 1,557 | 1,714 | 3,245 |
Net loss | (55,190) | (50,222) | (106,769) | (113,234) |
Other comprehensive income: | ||||
Unrealized gains on short-term investments | 245 | 112 | 868 | 235 |
Comprehensive loss | $ (54,945) | $ (50,110) | $ (105,901) | $ (112,999) |
Basic and diluted net loss per share | $ (0.61) | $ (0.63) | $ (1.18) | $ (1.43) |
Shares used in computing basic and diluted net loss per share | 90,753 | 79,548 | 90,581 | 78,987 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive (Loss) Income | Accumulated Deficit |
Balance at Dec. 31, 2018 | $ 370,160 | $ 782 | $ 1,330,186 | $ (87) | $ (960,721) |
Balance (in shares) at Dec. 31, 2018 | 78,174,000 | ||||
Conversion benefit included in Convertible Notes issued | 102 | 102 | |||
Issuance of common stock on exercise of stock options | 6,539 | $ 7 | 6,532 | ||
Issuance of common stock on exercise of stock options (in shares) | 732,000 | ||||
Stock-based compensation expense | 17,902 | 17,902 | |||
Net loss | (63,012) | (63,012) | |||
Net unrealized gain on short-term investments | 123 | 123 | |||
Comprehensive loss | (62,889) | ||||
Balance at Mar. 31, 2019 | 331,814 | $ 789 | 1,354,722 | 36 | (1,023,733) |
Balance (in shares) at Mar. 31, 2019 | 78,906,000 | ||||
Balance at Dec. 31, 2018 | 370,160 | $ 782 | 1,330,186 | (87) | (960,721) |
Balance (in shares) at Dec. 31, 2018 | 78,174,000 | ||||
Net loss | (113,234) | ||||
Net unrealized gain on short-term investments | 235 | ||||
Comprehensive loss | (112,999) | ||||
Balance at Jun. 30, 2019 | 305,359 | $ 798 | 1,378,368 | 148 | (1,073,955) |
Balance (in shares) at Jun. 30, 2019 | 79,779,000 | ||||
Balance at Mar. 31, 2019 | 331,814 | $ 789 | 1,354,722 | 36 | (1,023,733) |
Balance (in shares) at Mar. 31, 2019 | 78,906,000 | ||||
Conversion benefit included in Convertible Notes issued | 103 | 103 | |||
Issuance of common stock on exercise of stock options | 9,676 | $ 8 | 9,668 | ||
Issuance of common stock on exercise of stock options (in shares) | 810,000 | ||||
Issuance of common stock under the employee stock purchase plan | 1,170 | $ 1 | 1,169 | ||
Issuance of common stock on under the Employee Stock Purchase Plan (in shares) | 63,000 | ||||
Stock-based compensation expense | 12,706 | 12,706 | |||
Net loss | (50,222) | (50,222) | |||
Net unrealized gain on short-term investments | 112 | 112 | |||
Comprehensive loss | (50,110) | ||||
Balance at Jun. 30, 2019 | 305,359 | $ 798 | 1,378,368 | 148 | (1,073,955) |
Balance (in shares) at Jun. 30, 2019 | 79,779,000 | ||||
Balance at Dec. 31, 2019 | 403,835 | $ 903 | 1,568,317 | 85 | (1,165,470) |
Balance (in shares) at Dec. 31, 2019 | 90,304,000 | ||||
Conversion benefit included in Convertible Notes issued | 108 | 108 | |||
Issuance of common stock on exercise of stock options | 504 | 504 | |||
Issuance of common stock on exercise of stock options (in shares) | 70,000 | ||||
Issuance of common stock on exercise of warrants | 3 | $ 3 | |||
Issuance of common stock on exercise of warrants (in shares) | 268,000 | ||||
Stock-based compensation expense | 11,974 | 11,974 | |||
Net loss | (51,579) | (51,579) | |||
Net unrealized gain on short-term investments | 623 | 623 | |||
Comprehensive loss | (50,956) | ||||
Balance at Mar. 31, 2020 | 365,468 | $ 906 | 1,580,903 | 708 | (1,217,049) |
Balance (in shares) at Mar. 31, 2020 | 90,642,000 | ||||
Balance at Dec. 31, 2019 | $ 403,835 | $ 903 | 1,568,317 | 85 | (1,165,470) |
Balance (in shares) at Dec. 31, 2019 | 90,304,000 | ||||
Issuance of common stock on exercise of stock options (in shares) | 124,000 | ||||
Net loss | $ (106,769) | ||||
Net unrealized gain on short-term investments | 868 | ||||
Comprehensive loss | (105,901) | ||||
Balance at Jun. 30, 2020 | 324,058 | $ 908 | 1,594,436 | 953 | (1,272,239) |
Balance (in shares) at Jun. 30, 2020 | 90,820,000 | ||||
Balance at Mar. 31, 2020 | 365,468 | $ 906 | 1,580,903 | 708 | (1,217,049) |
Balance (in shares) at Mar. 31, 2020 | 90,642,000 | ||||
Conversion benefit included in Convertible Notes issued | 109 | 109 | |||
Issuance of common stock on exercise of stock options | 805 | $ 1 | 804 | ||
Issuance of common stock on exercise of stock options (in shares) | 54,000 | ||||
Issuance of common stock under the employee stock purchase plan | 1,507 | $ 1 | 1,506 | ||
Issuance of common stock on under the Employee Stock Purchase Plan (in shares) | 124,000 | ||||
Stock-based compensation expense | 11,114 | 11,114 | |||
Net loss | (55,190) | (55,190) | |||
Net unrealized gain on short-term investments | 245 | 245 | |||
Comprehensive loss | (54,945) | ||||
Balance at Jun. 30, 2020 | $ 324,058 | $ 908 | $ 1,594,436 | $ 953 | $ (1,272,239) |
Balance (in shares) at Jun. 30, 2020 | 90,820,000 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Operating activities: | ||
Net loss | $ (106,769,000) | $ (113,234,000) |
Adjustments to reconcile net loss to net cash used for operating activities: | ||
Stock-based compensation expense | 23,088,000 | 30,608,000 |
Depreciation and amortization | 1,366,000 | 959,000 |
Amortization of debt discount | 645,000 | 507,000 |
Realized gain on available-for-sale securities | 0 | (8,000) |
Accretion of discount on short-term investments | (82,000) | (2,437,000) |
Impairment of property and equipment | 53,000 | 54,000 |
Loss on disposal of property and equipment | 53,000 | |
Change in operating assets and liabilities: | ||
Accounts receivable | 2,377,000 | (2,169,000) |
Inventory | (16,474,000) | 9,762,000 |
Prepaid expenses and other assets | 10,136,000 | 2,454,000 |
Accounts payable | 15,700,000 | (8,866,000) |
Accrued clinical and manufacturing liabilities | (4,441,000) | 913,000 |
Accrued payroll and employee liabilities | (4,055,000) | (4,415,000) |
Other accrued liabilities | (11,756,000) | 13,687,000 |
Net cash used for operating activities | (90,212,000) | (72,132,000) |
Investing activities: | ||
Purchases of short-term investments | (66,915,000) | (204,358,000) |
Maturities and sales of short-term investments | 166,825,000 | 284,606,000 |
Purchases of property and equipment | (3,687,000) | (4,299,000) |
Net cash provided by investing activities | 96,223,000 | 75,949,000 |
Financing activities: | ||
Proceeds from stock option exercises | 1,309,000 | 16,215,000 |
Proceeds from purchases under the Employee Stock Purchase Plan | 1,507,000 | 1,170,000 |
Proceeds from warrant exercises | 3,000 | |
Net cash provided by financing activities | 2,819,000 | 17,385,000 |
Net increase in cash and cash equivalents | 8,830,000 | 21,202,000 |
Cash and cash equivalents at beginning of year | 71,898,000 | 31,836,000 |
Cash and cash equivalents at end of period | $ 80,728,000 | $ 53,038,000 |
Business
Business | 6 Months Ended |
Jun. 30, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Business | 1. Business We are a commercial-stage biotechnology company focused on improving the lives of patients by developing best-in-class treatments to address some of the most important unmet patient needs. We are developing novel, patient-focused solutions that apply our innovative science and technologies to already-approved pharmacological agents for patients suffering from pain or cancer. In August 2016, our first commercial product, SUSTOL (granisetron) extended-release injection (“SUSTOL”), was approved by the U.S. Food and Drug Administration (“FDA”). SUSTOL is indicated in combination with other antiemetics in adults for the prevention of acute and delayed nausea and vomiting associated with initial and repeat courses of moderately emetogenic chemotherapy (MEC) or anthracycline and cyclophosphamide (AC) combination chemotherapy regimens. SUSTOL is an extended-release, injectable 5-hydroxytryptamine type 3 receptor antagonist that utilizes our proprietary Biochronomer drug delivery technology to maintain therapeutic levels of granisetron for ≥5 days. We commenced commercial sales of SUSTOL in the U.S. in October 2016. In November 2017, our second commercial product, CINVANTI (aprepitant) injectable emulsion (“CINVANTI”) In October 2019, the FDA approved our supplemental New Drug Application (“sNDA”) for CINVANTI to expand the indication and recommended dosage to include the 130 mg single-dose regimen for patients receiving (“MEC”). 1 1 approved our sNDA for CINVANTI, for IV use, which expanded the administration of CINVANTI beyond the initially approved administration method (a 30-minute IV infusion) to include a 2-minute IV injection. CINVANTI is under investigation for the treatment of Coronavirus Disease 2019 (“COVID-19”) as a daily 2-minute IV injection when added to the current standard of care. HTX-011 (ZYNRELEF in the European Union), an investigational non-opioid, is a dual-acting, fixed-dose combination of the local anesthetic bupivacaine with a low dose of the nonsteroidal anti-inflammatory drug meloxicam. It is the first and only extended-release local anesthetic to demonstrate in Phase 3 studies significantly reduced pain and opioid use through 72 hours compared to bupivacaine solution, the current standard-of-care local anesthetic for postoperative pain control. HTX-011 was granted Fast Track designation from the FDA in the fourth quarter of 2017 and Breakthrough Therapy designation in the second quarter of 2018. Heron submitted a New Drug Application (“NDA”) to the FDA for HTX-011 in October 2018 and received Priority Review designation in December 2018. A Complete Response Letter (“CRL”) was received from the FDA regarding the NDA for HTX-011 on June 26, 2020. The CRL stated that the FDA is unable to approve the NDA in its present form based on the need for additional non-clinical information. Based on the complete review of the NDA, the FDA did not identify any clinical safety or efficacy issues or chemistry, manufacturing and controls issues. There are four non-clinical issues in the CRL, none of which relate to any observed toxicity. Three relate to confirming exposure of excipients in preclinical reproductive toxicology studies, and the fourth relates to changing the manufacturing release specification of the allowable level of an impurity based on animal toxicology coverage. The European Medicines Agency’s Committee for Medicinal Products for Human Use (“CHMP”) adopted a positive opinion for ZYNRELEF in July 2020. The CHMP’s positive opinion will now be reviewed by the European Commission (“EC”), with a final decision on the Marketing Authorisation Application expected in the coming months. An EC marketing authorisation through the Centralised Procedure is valid in all 27 European Union member countries as well as the European Economic Area countries. The CHMP recommended that ZYNRELEF be indicated for treatment of somatic postoperative pain from small- to medium-sized surgical wounds in adults. Heron’s New Drug Submission for HTX-011 for the management of postoperative pain was granted Priority Review status by Health Canada in October 2019 and accepted by Health Canada in November 2019. Heron is working to respond to a list of questions received from Health Canada in July 2020. HTX-034, our next - generation product candidate for postoperative pain management , is an investigational non-opioid, fixed-dose combination, extended ‑release solution of the local anesthetic bupivacaine, the nonsteroidal anti-inflammatory drug meloxicam and an additional agent that further potentiates the activity of bupivacaine. HTX-034 is formulated in the same proprietary polymer as HTX-011 (ZYNRELEF in the European Union) . By combining two different mechanisms that each enhance the activity of the local anesthetic bupivacaine, HTX-034 is designed to provide superior and prolonged analgesia. Local administration of HTX-034 in a validated preclinical postoperative pain model resulted in sustained analgesia for 7 days. In May 2020, we initiated a Phase 1b/2 clinical study in patients undergoing bunionectomy of HTX-034. The study initiation follows clearance from the FDA of our Investigational New Drug application for HTX-034 for the treatment of postoperative pain. As of June 30, 2020 we had $300.8 million in cash, cash equivalents and short-term investments. We have incurred significant operating losses and negative cash flows from operations. Management believes that the Company’s existing cash, cash equivalents and short-term investments will be sufficient to meet the Company’s anticipated cash requirements for at least one year from the date this Quarterly Report on Form 10-Q is filed with the U.S. Securities and Exchange Commission (“SEC”). |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | 2. Basis of Presentation The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the U.S. (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and disclosures required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2020 are not necessarily indicative of the results that may be expected for other quarters or the year ending December 31, 2020. The condensed consolidated balance sheet as of December 31, 2019 has been derived from the audited financial statements as of that date, but does not include all of the information and disclosures required by GAAP. For more complete financial information, these condensed consolidated financial statements and the notes thereto should be read in conjunction with the audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2019, which was filed with the SEC on March 2, 2020. |
Accounting Policies
Accounting Policies | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Accounting Policies | 3. Accounting Policies Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of Heron Therapeutics, Inc. and its wholly-owned subsidiary, Heron Therapeutics B.V., which was organized in the Netherlands in March 2015. Heron Therapeutics B.V. has no operations and no material assets or liabilities, and there have been no significant transactions related to Heron Therapeutics B.V. since its inception. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and disclosures made in the accompanying notes to the financial statements. Our significant accounting policies that involve significant judgment and estimates include revenue recognition, investments, inventory and the related reserves, accrued clinical liabilities, income taxes and stock-based compensation. Actual results could differ materially from those estimates. Cash, Cash Equivalents and Short-term Investments Cash and cash equivalents consist of cash and highly liquid investments with contractual maturities of three months or less from the original purchase date. Short-term investments consist of securities with contractual maturities of greater than three months from the original purchase date. Securities with contractual maturities greater than one year are classified as short-term investments on the condensed consolidated balance sheets, as we have the ability, if necessary, to liquidate these securities to meet our liquidity needs in the next 12 months. We have classified our short-term investments as available-for-sale securities in the accompanying condensed consolidated financial statements. Available-for-sale securities are stated at fair market value, with net changes in unrealized gains and losses reported in other comprehensive loss and realized gains and losses included in other income (expense), net. The cost of securities sold is based on the specific identification method. Interest and dividends on securities classified as available-for-sale are included in interest income. Our bank and investment accounts have been placed under a control agreement in accordance with our Senior Secured Convertible Notes (“Convertible Notes”) (see Note 8). Concentration of Credit Risk Cash, cash equivalents and short-term investments are financial instruments that potentially subject us to concentrations of credit risk. We deposit our cash in financial institutions. At times, such deposits may be in excess of insured limits. We may also invest our excess cash in money market funds, U.S. government and agencies, corporate debt securities and commercial paper. We have established guidelines relative to our diversification of our cash investments and their maturities in an effort to maintain safety and liquidity. These guidelines are periodically reviewed and modified to take advantage of trends in yields and interest rates. Our products are distributed in the U.S. through a limited number of specialty distributors and full line wholesalers (collectively, “Customers”) that resell our products to healthcare providers and hospitals, the end users. The following table includes the percentage of net product sales and accounts receivable balances for our three major Customers, each of which comprised 10% or more of our net product sales: Net Product Sales Accounts Receivable Three Months Ended June 30, 2020 Six Months Ended June 30, 2020 As of June 30, 2020 Customer A 44.5 % 42.5 % 56.1 % Customer B 32.2 % 34.5 % 32.2 % Customer C 21.3 % 21.1 % 10.9 % Total 98.0 % 98.1 % 99.2 % Accounts Receivable, Net Accounts receivable are recorded at the invoice amount, net of an allowance for doubtful accounts. The allowance for doubtful accounts reflects accounts receivable balances that are believed to be uncollectible. In estimating the allowance for doubtful accounts, we consider: (1) our historical experience with collections and write-offs; (2) the credit quality of our Customers and any recent or anticipated changes thereto; and (3) the outstanding balances and past due amounts from our Customers. As of June 30, 2020 and December 31, 2019, we determined that an allowance for doubtful accounts was not required. For the three and six months ended June 30, 2020 and 2019, we did not write off any accounts receivable balances. Inventory Inventory is stated at the lower of cost or estimated net realizable value on a first-in, first-out, or FIFO, basis. We periodically analyze our inventory levels and write down inventory that has become obsolete, inventory that has a cost basis in excess of its estimated realizable value and inventory quantities that are in excess of expected sales requirements as cost of product sales. The determination of whether inventory costs will be realizable requires estimates by management. If actual market conditions are less favorable than projected by management, additional write-downs of inventory may be required, which would be recorded as cost of product sales. Leases In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02, Leases (Topic 842) Leases (Topic 842): Targeted Improvements Codification Improvements to Topic 842, Leases Leases We determine if an agreement is a lease or contains lease components at inception. Operating leases are recorded as lease liabilities with corresponding ROU lease assets on the condense d consolidated balance sheets. RO U lease asse ts represent our right to use the underlying asset s over the lease term , and lease liabilities represent the present value of our obligation to make lease payments arising from the lease. Lease liabilities are recognized at the lease commencement based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. We use the implicit rate when readily determinable. The ROU lease asset s equal the lease liabilities , less unamortized lease incentives , unamortized initial direct costs and the cumulative difference between rent expense and amounts paid under the lease . The lease term include s any option to extend or terminate the lease when it is reasonably certain that we will exercise that option. L ease expense is recognized on a straight-line basis over the lease term. We have lease agreements with both lease and non-lease components, which are generally accounted for separately. Revenue Recognition In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers Product Sales CINVANTI is distributed in the U.S. through a limited number of Customers that resell CINVANTI to healthcare providers and hospitals, the end users of CINVANTI. SUSTOL is distributed in the U.S. through a limited number of Customers that resell SUSTOL to healthcare providers, the end users of SUSTOL. Revenue is recognized in an amount that reflects the consideration we expect to receive in exchange for our products. To determine revenue recognition for contracts with customers within the scope of Topic 606, we perform the following 5 steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations of the contract(s); (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract(s); and (v) recognize revenue when (or as) we satisfy the performance obligations. Product Sales Allowances We recognize product sales allowances as a reduction of product sales in the same period the related revenue is recognized. Product sales allowances are based on amounts owed or to be claimed on the related sales. These estimates take into consideration the terms of our agreements with Customers, historical product returns, rebates or discounts taken, the shelf life of the product and specific known market events, such as competitive pricing and new product introductions. If actual future results vary from our estimates, we may need to adjust these estimates, which could have an effect on product sales and earnings in the period of adjustment. Our product sales allowances include: • Product Returns—We allow our Customers to return product for credit up to 12 months after its product expiration date. As such, there may be a significant period of time between the time the product is shipped and the time the credit is issued on returned product. • Distributor Fees—We offer contractually determined discounts to our Customers. These discounts are paid no later than two months after the quarter in which product was shipped. • Group Purchasing Organization (“GPO”) Discounts and Rebates—We offer cash discounts to GPO members. These discounts are taken when the GPO members purchase product from our Customers, who then charge back to us the discount amount. Additionally, we offer volume and contract-tier rebates to GPO members. Rebates are based on actual purchase levels during the quarterly rebate purchase period. • GPO Administrative Fees—We pay administrative fees to GPOs for services and access to data. These fees are based on contracted terms and are paid after the quarter in which the product was purchased by the GPOs’ members. • Medicaid Rebates—We participate in Medicaid rebate programs, which provide assistance to certain low-income patients based on each individual state’s guidelines regarding eligibility and services. Under the Medicaid rebate programs, we pay a rebate to each participating state, generally within three months after the quarter in which the product was sold. We believe our estimated allowance for product returns requires a high degree of judgment and is subject to change based on our experience and certain quantitative and qualitative factors. We believe our estimated allowances for distributor fees, GPO discounts, rebates and administrative fees and Medicaid rebates do not require a high degree of judgment because the amounts are settled within a relatively short period of time. Our product sales allowances and related accruals are evaluated each reporting period and adjusted when trends or significant events indicate that a change in estimate is appropriate. Changes in product sales allowance estimates could materially affect our results of operations and financial position. Net product sales for the three and six months ended June 30, 2020 were $22.7 million and $48.1 million, respectively, compared to $36.7 million and $68.3 million, respectively, for the same periods in 2019. For the three and six months ended June 30, 2020, net products sales of CINVANTI were $22.6 million and $47.8 million, respectively, compared to $33.2 million and $61.2 million, respectively, for the same periods in 2019. For the three and six months ended June 30, 2020, net product sales of SUSTOL were $0.1 million and $0.3 million, respectively, compared to $3.5 million and $7.1 million, respectively, for the same periods in 2019. The following table provides a summary of activity with respect to our product returns, distributor fees and discounts, rebates and administrative fees, which are included in other accrued liabilities on the condensed consolidated balance sheets (in thousands): Product Returns Distributor Fees Discounts, Rebates and Administrative Fees Total Balance at December 31, 2019 $ 2,351 $ 3,999 $ 21,589 $ 27,939 Provision 382 8,215 50,100 58,697 Payments/credits (100 ) (8,843 ) (58,583 ) (67,526 ) Balance at June 30, 2020 $ 2,633 $ 3,371 $ 13,106 $ 19,110 Comprehensive Loss Comprehensive loss is defined as the change in equity during a period from transactions and other events and circumstances from non-owner sources. Net changes in unrealized gains and losses on available-for-sale securities are included in other comprehensive income and represent the difference between our net loss and comprehensive loss for all periods presented. Net Loss per Share Basic net loss per share is calculated by dividing the net loss by the weighted-average number of common shares outstanding for the period, without consideration of common stock equivalents. Diluted net loss per share is computed by dividing the net loss by the weighted-average number of common shares and common stock equivalents outstanding for the period determined using the treasury stock method. For purposes of this calculation, stock options, warrants and shares of common stock underlying Convertible Notes are considered to be common stock equivalents and are included in the calculation of diluted net loss per share only when their effect is dilutive. Because we have incurred a net loss for all periods presented in the unaudited condensed consolidated statements of operations and comprehensive loss, the following common stock equivalents were not included in the computation of net loss per share because their effect would be anti-dilutive (in thousands): June 30, 2020 2019 Stock options outstanding 16,306 13,545 Warrants outstanding 220 640 Shares of common stock underlying Convertible Notes outstanding 9,231 8,729 Recent Accounting Pronouncements Adopted in 2020 In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820) - Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments Financial Instruments - Credit Losses (Topic 326): Targeted Transition Relief have a material impact on our results of operations, financial condition or internal controls. Not Yet Adopted In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740) |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 4. Fair Value Measurements Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The FASB ASC Topic 820, Fair Value Measurements and Disclosures • Level 1—Observable inputs such as quoted prices in active markets for identical assets or liabilities. • Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. We measure cash, cash equivalents and short-term investments at fair value on a recurring basis. The fair values of such assets were as follows (in thousands): Fair Value Measurements at Reporting Date Using Balance at June 30, 2020 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Cash and money market funds $ 73,104 $ 73,104 $ — $ — U.S. treasury bills and government agency obligations 100,869 100,869 — — U.S. corporate debt securities 52,716 — 52,716 — Foreign corporate debt securities 23,736 — 23,736 — U.S. commercial paper 18,968 — 18,968 — Foreign commercial paper 31,449 — 31,449 — Total $ 300,842 $ 173,973 $ 126,869 $ — Fair Value Measurements at Reporting Date Using Balance at December 31, 2019 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Cash and money market funds $ 56,931 $ 56,931 $ — $ — U.S. treasury bills and government agency obligations 140,626 140,626 — — U.S. corporate debt securities 80,170 — 80,170 — Foreign corporate debt securities 23,203 — 23,203 — U.S. commercial paper 32,801 — 32,801 — Foreign commercial paper 57,241 — 57,241 — Total $ 390,972 $ 197,557 $ 193,415 $ — We have not transferred any investment securities between the three levels of the fair value hierarchy. As of June 30, 2020, cash equivalents included $7.6 million of available-for-sale securities with contractual maturities of three months or less. As of June 30, 2020, short-term investments included $205.7 million of available-for-sale securities with contractual maturities of three months to one year and $14.4 million of available-for-sale securities with contractual maturities greater than one year. As of December 31, 2019, cash equivalents included $15.0 million of available-for-sale securities with contractual maturities of three months or less. As of December 31, 2019, short-term investments included $279.7 million of available-for-sale securities with contractual maturities of three months to one year and $39.4 million of available-for-sale securities with contractual maturities greater than one year. The money market funds as of June 30, 2020 and December 31, 2019 are included in cash and cash equivalents on the condensed consolidated balance sheets. A company may elect to use fair value to measure accounts and loans receivable, available-for-sale and held-to-maturity securities, equity method investments, accounts payable, guarantees and issued debt. Other eligible items include firm commitments for financial instruments that otherwise would not be recognized at inception and non-cash warranty obligations where a warrantor is permitted to pay a third party to provide the warranty goods or services. If the use of fair value is elected, any upfront costs and fees related to the item such as debt issuance costs must be recognized in earnings and cannot be deferred. The fair value election is irrevocable and generally made on an instrument-by-instrument basis, even if a company has similar instruments that it elects not to measure based on fair value. Unrealized gains and losses on existing items for which fair value has been elected are reported as a cumulative adjustment to beginning retained earnings and any changes in fair value are recognized in earnings. We have elected to not apply the fair value option to our financial assets and liabilities. Financial instruments, including cash, cash equivalents, receivables, inventory, prepaid expenses, other current assets, accounts payable and accrued expenses are carried at cost, which is considered to be representative of their respective fair values because of the short-term maturity of these instruments. Short-term available-for-sale investments are carried at fair value. Our Convertible Notes outstanding at June 30, 2020 do not have a readily available market value, however, the carrying value is considered to approximate its fair value. |
Short-term Investments
Short-term Investments | 6 Months Ended |
Jun. 30, 2020 | |
Short Term Investments [Abstract] | |
Short-term Investments | 5. Short-term Investments The following is a summary of our short-term investments (in thousands): June 30, 2020 Gross Gross Amortized Unrealized Unrealized Estimated Cost Gains Losses Fair Value U.S. treasury bills and government agency obligations $ 100,309 $ 560 $ — $ 100,869 U.S. corporate debt securities 44,861 231 — 45,092 Foreign corporate debt securities 23,574 162 — 23,736 U.S. commercial paper 18,968 — — 18,968 Foreign commercial paper 31,449 — — 31,449 Total $ 219,161 $ 953 $ — $ 220,114 December 31, 2019 Gross Gross Amortized Unrealized Unrealized Estimated Cost Gains Losses Fair Value U.S. treasury bills and government agency obligations $ 140,567 $ 59 $ — $ 140,626 U.S. corporate debt securities 80,159 11 — 80,170 Foreign corporate debt securities 23,188 15 — 23,203 U.S. commercial paper 32,801 — — 32,801 Foreign commercial paper 42,274 — — 42,274 Total $ 318,989 $ 85 $ — $ 319,074 The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity. We regularly monitor and evaluate the realizable value of our marketable securities. We did not recognize any impairment losses during the three and six months ended June 30, 2020 and 2019. Realized gains and losses associated with our available-for-sale securities, if any, are reported in the statements of operations and comprehensive loss. We did not recognize any realized gains or losses during the three months ended June 30, 2020 and 2019. We did not recognize any realized gains or losses during the six months ended June 30, 2020. We recognized $8,000 of realized gains during the six months ended June 30, 2019. |
Inventory
Inventory | 6 Months Ended |
Jun. 30, 2020 | |
Inventory Disclosure [Abstract] | |
Inventory | 6. Inventory Inventory consists of the following (in thousands): June 30, 2020 December 31, 2019 Raw materials $ 18,979 $ 6,635 Work in process 12,820 12,571 Finished goods 9,643 5,762 Total inventory $ 41,442 $ 24,968 As of June 30, 2020, total inventory included $39.7 million related to CINVANTI and $1.7 million related to SUSTOL. As of December 31, 2019, total inventory included $23.5 million related to CINVANTI and $1.5 million related to SUSTOL. In addition, cost of product sales for the six months ended June 30, 2019 included charges of $1.6 million resulting from the write-off of short-dated SUSTOL inventory. |
Leases
Leases | 6 Months Ended |
Jun. 30, 2020 | |
Leases [Abstract] | |
Leases | 7. Leases In December 2019, we amended our existing operating lease for laboratory and office space in San Diego, California to expand the office space by an additional 21,180 square feet (“Lease Amendment”). The Lease Amendment commenced on January 1, 2020 and expires on December 31, 2025. We have an option to extend the lease for an additional 5 years on expiration. As of June 30, 2020, our operating lease for laboratory and office space in San Diego, California had a remaining lease term of 66 months. On January 1, 2019, on the adoption of Topic 842, we recognized initial ROU lease assets of $13.7 million and initial lease liabilities of $14.5 million. The option to extend our operating lease in San Diego was not recognized as part of our lease liability and ROU lease assets. During the three and six months ended June 30, 2020, we recognized $1.0 million and $2.0 million, respectively, of operating lease expense and we paid $1.0 million and $1.7 million, respectively, for our operating leases. Future minimum lease payments under our operating leases as of June 30, 2020 are as follows (in thousands): 2020 $ 1,922 2021 3,942 2022 4,058 2023 4,178 2024 4,274 Thereafter 4,379 Total future minimum lease payments $ 22,753 Less: discount (3,911 ) Total lease liabilities $ 18,842 |
Secured Notes to Related Party
Secured Notes to Related Party | 6 Months Ended |
Jun. 30, 2020 | |
Debt Disclosure [Abstract] | |
Secured Notes to Related Party | 8. Secured Notes to Related Party Convertible Notes In April 2011, we entered into a securities purchase agreement for a private placement of up to $4.5 million in Convertible Notes with certain investors, including Tang Capital Partners, LP (“TCP”). TCP is controlled by Tang Capital Management, LLC (“TCM”). The manager of TCM is Kevin Tang, who served as a director at the time and currently serves as the Chairman of our Board of Directors. At the time of issuance, the terms of the Convertible Notes were determined by our independent directors to be no less favorable than terms that would be obtained in an arm’s length financing transaction. We received a total of $4.3 million, net of issuance costs, from the issuance of these Convertible Notes. The Convertible Notes are secured by substantially all of our assets, including placing our bank and investment accounts under a control agreement. The Convertible Notes bear interest at 6% per annum, payable quarterly in cash or in additional principal amount of Convertible Notes, at the election of the purchasers. The Convertible Notes mature on May 2, 2021; however, the holders of the Convertible Notes may require prepayment of the Convertible Notes at any time, at each holder’s option. The Convertible Notes are convertible into shares of our common stock at a rate of 1,250 shares for every $1,000 of outstanding principal due under the Convertible Notes. There is no right to convert the Convertible Notes to the extent that, after giving effect to such conversion, the holder would beneficially own in excess of 9.99% of our outstanding common stock. Each holder of the Convertible Notes can increase or decrease this beneficial ownership conversion limit by written notice to us, which will not be effective until 61 days after delivery of the notice. As of June 30, 2020, we were in compliance with all covenants under the Convertible Notes. On the occurrence of an event of default under the Convertible Notes, the holders of the Convertible Notes have the right to require us to redeem all or a portion of their Convertible Notes. In 2011, we filed a registration statement with the SEC to register for resale 3.5 million shares underlying the Convertible Notes. The registration statement was declared effective on July 29, 2011. The Convertible Note holders have agreed to waive their right to require us to maintain the effectiveness of the registration statement and to register the additional shares underlying the Convertible Notes until they provide notice otherwise. The Convertible Notes contain an embedded conversion feature that was in-the-money on the issuance dates. Based on an effective fixed conversion rate of 1,250 shares for every $1,000 of principal and accrued interest due under the Convertible Notes, the total conversion benefit at issuance exceeded the loan proceeds. Therefore, a debt discount was recorded in an amount equal to the face value of the Convertible Notes on the issuance dates, and we began amortizing the resultant debt discount over the respective 10-year term of the Convertible Notes. During the six months ended June 30, 2020, accrued interest of $0.2 million was paid-in-kind and rolled into the Convertible Note principal balance, which resulted in an additional debt discount of $0.2 million. For each of the three months ended June 30, 2020 and 2019, interest expense relating to the stated rate was $0.1 million. For each of the three months ended June 30, 2020 and 2019, interest expense relating to the amortization of the debt discount was $0.3 million. For each of the six months ended June 30, 2020 and 2019, interest expense relating to the stated rate was $0.2 million. For the six months ended June 30, 2020 and 2019, interest expense relating to the amortization of the debt discount was $0.6 million and $0.5 million, respectively. As of June 30, 2020, the carrying value of the Convertible Notes was $6.3 million, which is comprised of the $7.4 million principal amount of the Convertible Notes outstanding, less debt discount of $1.1 million. As of June 30, 2020, the Convertible Notes were convertible into 9.2 million shares of our common stock. |
Stockholders' Equity
Stockholders' Equity | 6 Months Ended |
Jun. 30, 2020 | |
Equity [Abstract] | |
Stockholders' Equity | 9. Stockholders’ Equity Common Stock Offering In October 2019, we sold 9.9 million shares of our common stock at a public offering price of $17.50 per share. We received total net cash proceeds of $162.2 million (net of $10.3 million in issuance costs) from the sale of the common stock. Public Offering Warrants In June 2014, as a component of our public offering, we sold 600,000 pre-funded warrants to purchase shares of our common stock. The pre-funded warrants have an exercise price of $0.01 per share and expire on June 30, 2021. During the six months ended June 30, 2020, warrant holders exercised 267,870 warrants, which resulted in the issuance of 267,870 shares for net cash proceeds of $2,679. As of June 30, 2020, 195,574 warrants from the June 2014 public offering remain outstanding. Stock Option Activity The following table summarizes the stock option activity for the six months ended June 30, 2020: Shares (in thousands) Weighted- average Exercise Price Weighted- average Remaining Contractual Term (Years) Balance at December 31, 2019 16,665 $ 20.47 7.87 Granted 249 $ 19.24 Exercised (124 ) $ 10.57 Expired and forfeited (484 ) $ 22.57 Balance at June 30, 2020 16,306 $ 20.46 7.31 For the six months ended June 30, 2020, 124,000 shares of common stock were issued pursuant to the exercise of stock options, resulting in net proceeds of $1.3 million. Stock-based Compensation The following table summarizes stock-based compensation expense related to stock-based payment awards granted pursuant to all of our equity compensation arrangements (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Research and development $ 4,681 $ 4,434 $ 9,968 $ 9,758 General and administrative 3,304 3,714 6,735 7,394 Sales and marketing 3,129 4,558 6,385 13,456 Total stock-based compensation expense $ 11,114 $ 12,706 $ 23,088 $ 30,608 As of June 30, 2020, there 103.0 2.7 . We estimated the fair value of each option grant on the grant date using the Black-Scholes option pricing model with the following weighted-average assumptions: June 30, 2020 2019 Risk-free interest rate 1.1 % 2.4 % Dividend yield 0.0 % 0.0 % Volatility 66.7 % 68.0 % Expected life (years) 6 6 We estimated the fair value of each purchase right granted under our 1997 Employee Stock Purchase Plan, as amended, at the beginning of each new offering period using the Black-Scholes option pricing model with the following weighted-average assumptions: June 30, 2020 2019 Risk-free interest rate 0.1 % 2.4 % Dividend yield 0.0 % 0.0 % Volatility 63.3 % 58.4 % Expected life (months) 6 6 |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 10. Income Taxes Deferred income tax assets and liabilities are recognized for temporary differences between financial statements and income tax carrying values using tax rates in effect for the years such differences are expected to reverse. Due to uncertainties surrounding our ability to generate future taxable income and consequently realize such deferred income tax assets, a full valuation allowance has been established. We continue to maintain a full valuation allowance against our deferred tax assets as of June 30, 2020. The impact of an uncertain income tax position on the income tax return must be recognized at the largest amount that is more likely than not to be sustained upon audit by the relevant tax authority. An uncertain income tax position will be recognized when it is more likely than not of being sustained. The disclosures regarding an uncertain income tax position included in our Annual Report on Form 10-K for the year ended December 31, 2019, which was filed with the SEC on March 2, 2020, continue to be accurate for the three and six months ended June 30, 2020. |
Accounting Policies (Policies)
Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the U.S. (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and disclosures required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2020 are not necessarily indicative of the results that may be expected for other quarters or the year ending December 31, 2020. The condensed consolidated balance sheet as of December 31, 2019 has been derived from the audited financial statements as of that date, but does not include all of the information and disclosures required by GAAP. For more complete financial information, these condensed consolidated financial statements and the notes thereto should be read in conjunction with the audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2019, which was filed with the SEC on March 2, 2020. |
Principles of Consolidation | Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of Heron Therapeutics, Inc. and its wholly-owned subsidiary, Heron Therapeutics B.V., which was organized in the Netherlands in March 2015. Heron Therapeutics B.V. has no operations and no material assets or liabilities, and there have been no significant transactions related to Heron Therapeutics B.V. since its inception. |
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 amounts reported in the financial statements and disclosures made in the accompanying notes to the financial statements. Our significant accounting policies that involve significant judgment and estimates include revenue recognition, investments, inventory and the related reserves, accrued clinical liabilities, income taxes and stock-based compensation. Actual results could differ materially from those estimates. |
Cash, Cash Equivalents and Short-term Investments | Cash, Cash Equivalents and Short-term Investments Cash and cash equivalents consist of cash and highly liquid investments with contractual maturities of three months or less from the original purchase date. Short-term investments consist of securities with contractual maturities of greater than three months from the original purchase date. Securities with contractual maturities greater than one year are classified as short-term investments on the condensed consolidated balance sheets, as we have the ability, if necessary, to liquidate these securities to meet our liquidity needs in the next 12 months. We have classified our short-term investments as available-for-sale securities in the accompanying condensed consolidated financial statements. Available-for-sale securities are stated at fair market value, with net changes in unrealized gains and losses reported in other comprehensive loss and realized gains and losses included in other income (expense), net. The cost of securities sold is based on the specific identification method. Interest and dividends on securities classified as available-for-sale are included in interest income. Our bank and investment accounts have been placed under a control agreement in accordance with our Senior Secured Convertible Notes (“Convertible Notes”) (see Note 8). |
Concentration of Credit Risk | Concentration of Credit Risk Cash, cash equivalents and short-term investments are financial instruments that potentially subject us to concentrations of credit risk. We deposit our cash in financial institutions. At times, such deposits may be in excess of insured limits. We may also invest our excess cash in money market funds, U.S. government and agencies, corporate debt securities and commercial paper. We have established guidelines relative to our diversification of our cash investments and their maturities in an effort to maintain safety and liquidity. These guidelines are periodically reviewed and modified to take advantage of trends in yields and interest rates. Our products are distributed in the U.S. through a limited number of specialty distributors and full line wholesalers (collectively, “Customers”) that resell our products to healthcare providers and hospitals, the end users. The following table includes the percentage of net product sales and accounts receivable balances for our three major Customers, each of which comprised 10% or more of our net product sales: Net Product Sales Accounts Receivable Three Months Ended June 30, 2020 Six Months Ended June 30, 2020 As of June 30, 2020 Customer A 44.5 % 42.5 % 56.1 % Customer B 32.2 % 34.5 % 32.2 % Customer C 21.3 % 21.1 % 10.9 % Total 98.0 % 98.1 % 99.2 % |
Accounts Receivable, Net | Accounts Receivable, Net Accounts receivable are recorded at the invoice amount, net of an allowance for doubtful accounts. The allowance for doubtful accounts reflects accounts receivable balances that are believed to be uncollectible. In estimating the allowance for doubtful accounts, we consider: (1) our historical experience with collections and write-offs; (2) the credit quality of our Customers and any recent or anticipated changes thereto; and (3) the outstanding balances and past due amounts from our Customers. As of June 30, 2020 and December 31, 2019, we determined that an allowance for doubtful accounts was not required. For the three and six months ended June 30, 2020 and 2019, we did not write off any accounts receivable balances. |
Inventory | Inventory Inventory is stated at the lower of cost or estimated net realizable value on a first-in, first-out, or FIFO, basis. We periodically analyze our inventory levels and write down inventory that has become obsolete, inventory that has a cost basis in excess of its estimated realizable value and inventory quantities that are in excess of expected sales requirements as cost of product sales. The determination of whether inventory costs will be realizable requires estimates by management. If actual market conditions are less favorable than projected by management, additional write-downs of inventory may be required, which would be recorded as cost of product sales. |
Leases | Leases In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02, Leases (Topic 842) Leases (Topic 842): Targeted Improvements Codification Improvements to Topic 842, Leases Leases We determine if an agreement is a lease or contains lease components at inception. Operating leases are recorded as lease liabilities with corresponding ROU lease assets on the condense d consolidated balance sheets. RO U lease asse ts represent our right to use the underlying asset s over the lease term , and lease liabilities represent the present value of our obligation to make lease payments arising from the lease. Lease liabilities are recognized at the lease commencement based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. We use the implicit rate when readily determinable. The ROU lease asset s equal the lease liabilities , less unamortized lease incentives , unamortized initial direct costs and the cumulative difference between rent expense and amounts paid under the lease . The lease term include s any option to extend or terminate the lease when it is reasonably certain that we will exercise that option. L ease expense is recognized on a straight-line basis over the lease term. We have lease agreements with both lease and non-lease components, which are generally accounted for separately. |
Revenue Recognition | Revenue Recognition In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers Product Sales CINVANTI is distributed in the U.S. through a limited number of Customers that resell CINVANTI to healthcare providers and hospitals, the end users of CINVANTI. SUSTOL is distributed in the U.S. through a limited number of Customers that resell SUSTOL to healthcare providers, the end users of SUSTOL. Revenue is recognized in an amount that reflects the consideration we expect to receive in exchange for our products. To determine revenue recognition for contracts with customers within the scope of Topic 606, we perform the following 5 steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations of the contract(s); (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract(s); and (v) recognize revenue when (or as) we satisfy the performance obligations. Product Sales Allowances We recognize product sales allowances as a reduction of product sales in the same period the related revenue is recognized. Product sales allowances are based on amounts owed or to be claimed on the related sales. These estimates take into consideration the terms of our agreements with Customers, historical product returns, rebates or discounts taken, the shelf life of the product and specific known market events, such as competitive pricing and new product introductions. If actual future results vary from our estimates, we may need to adjust these estimates, which could have an effect on product sales and earnings in the period of adjustment. Our product sales allowances include: • Product Returns—We allow our Customers to return product for credit up to 12 months after its product expiration date. As such, there may be a significant period of time between the time the product is shipped and the time the credit is issued on returned product. • Distributor Fees—We offer contractually determined discounts to our Customers. These discounts are paid no later than two months after the quarter in which product was shipped. • Group Purchasing Organization (“GPO”) Discounts and Rebates—We offer cash discounts to GPO members. These discounts are taken when the GPO members purchase product from our Customers, who then charge back to us the discount amount. Additionally, we offer volume and contract-tier rebates to GPO members. Rebates are based on actual purchase levels during the quarterly rebate purchase period. • GPO Administrative Fees—We pay administrative fees to GPOs for services and access to data. These fees are based on contracted terms and are paid after the quarter in which the product was purchased by the GPOs’ members. • Medicaid Rebates—We participate in Medicaid rebate programs, which provide assistance to certain low-income patients based on each individual state’s guidelines regarding eligibility and services. Under the Medicaid rebate programs, we pay a rebate to each participating state, generally within three months after the quarter in which the product was sold. We believe our estimated allowance for product returns requires a high degree of judgment and is subject to change based on our experience and certain quantitative and qualitative factors. We believe our estimated allowances for distributor fees, GPO discounts, rebates and administrative fees and Medicaid rebates do not require a high degree of judgment because the amounts are settled within a relatively short period of time. Our product sales allowances and related accruals are evaluated each reporting period and adjusted when trends or significant events indicate that a change in estimate is appropriate. Changes in product sales allowance estimates could materially affect our results of operations and financial position. Net product sales for the three and six months ended June 30, 2020 were $22.7 million and $48.1 million, respectively, compared to $36.7 million and $68.3 million, respectively, for the same periods in 2019. For the three and six months ended June 30, 2020, net products sales of CINVANTI were $22.6 million and $47.8 million, respectively, compared to $33.2 million and $61.2 million, respectively, for the same periods in 2019. For the three and six months ended June 30, 2020, net product sales of SUSTOL were $0.1 million and $0.3 million, respectively, compared to $3.5 million and $7.1 million, respectively, for the same periods in 2019. The following table provides a summary of activity with respect to our product returns, distributor fees and discounts, rebates and administrative fees, which are included in other accrued liabilities on the condensed consolidated balance sheets (in thousands): Product Returns Distributor Fees Discounts, Rebates and Administrative Fees Total Balance at December 31, 2019 $ 2,351 $ 3,999 $ 21,589 $ 27,939 Provision 382 8,215 50,100 58,697 Payments/credits (100 ) (8,843 ) (58,583 ) (67,526 ) Balance at June 30, 2020 $ 2,633 $ 3,371 $ 13,106 $ 19,110 |
Comprehensive Loss | Comprehensive Loss Comprehensive loss is defined as the change in equity during a period from transactions and other events and circumstances from non-owner sources. Net changes in unrealized gains and losses on available-for-sale securities are included in other comprehensive income and represent the difference between our net loss and comprehensive loss for all periods presented. |
Net Loss per Share | Net Loss per Share Basic net loss per share is calculated by dividing the net loss by the weighted-average number of common shares outstanding for the period, without consideration of common stock equivalents. Diluted net loss per share is computed by dividing the net loss by the weighted-average number of common shares and common stock equivalents outstanding for the period determined using the treasury stock method. For purposes of this calculation, stock options, warrants and shares of common stock underlying Convertible Notes are considered to be common stock equivalents and are included in the calculation of diluted net loss per share only when their effect is dilutive. Because we have incurred a net loss for all periods presented in the unaudited condensed consolidated statements of operations and comprehensive loss, the following common stock equivalents were not included in the computation of net loss per share because their effect would be anti-dilutive (in thousands): June 30, 2020 2019 Stock options outstanding 16,306 13,545 Warrants outstanding 220 640 Shares of common stock underlying Convertible Notes outstanding 9,231 8,729 |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Adopted in 2020 In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820) - Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments Financial Instruments - Credit Losses (Topic 326): Targeted Transition Relief have a material impact on our results of operations, financial condition or internal controls. Not Yet Adopted In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740) |
Accounting Policies (Tables)
Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Percentage of Net Product Sales and Accounts Receivable Balance | Our products are distributed in the U.S. through a limited number of specialty distributors and full line wholesalers (collectively, “Customers”) that resell our products to healthcare providers and hospitals, the end users. The following table includes the percentage of net product sales and accounts receivable balances for our three major Customers, each of which comprised 10% or more of our net product sales: Net Product Sales Accounts Receivable Three Months Ended June 30, 2020 Six Months Ended June 30, 2020 As of June 30, 2020 Customer A 44.5 % 42.5 % 56.1 % Customer B 32.2 % 34.5 % 32.2 % Customer C 21.3 % 21.1 % 10.9 % Total 98.0 % 98.1 % 99.2 % |
Summary of Activity to Product Returns, Distributor Fees and Discounts, Rebates and Administrative Fees | The following table provides a summary of activity with respect to our product returns, distributor fees and discounts, rebates and administrative fees, which are included in other accrued liabilities on the condensed consolidated balance sheets (in thousands): Product Returns Distributor Fees Discounts, Rebates and Administrative Fees Total Balance at December 31, 2019 $ 2,351 $ 3,999 $ 21,589 $ 27,939 Provision 382 8,215 50,100 58,697 Payments/credits (100 ) (8,843 ) (58,583 ) (67,526 ) Balance at June 30, 2020 $ 2,633 $ 3,371 $ 13,106 $ 19,110 |
Common Stock Equivalents Excluded From Computation of Net Loss Per Share | Because we have incurred a net loss for all periods presented in the unaudited condensed consolidated statements of operations and comprehensive loss, the following common stock equivalents were not included in the computation of net loss per share because their effect would be anti-dilutive (in thousands): June 30, 2020 2019 Stock options outstanding 16,306 13,545 Warrants outstanding 220 640 Shares of common stock underlying Convertible Notes outstanding 9,231 8,729 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | We measure cash, cash equivalents and short-term investments at fair value on a recurring basis. The fair values of such assets were as follows (in thousands): Fair Value Measurements at Reporting Date Using Balance at June 30, 2020 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Cash and money market funds $ 73,104 $ 73,104 $ — $ — U.S. treasury bills and government agency obligations 100,869 100,869 — — U.S. corporate debt securities 52,716 — 52,716 — Foreign corporate debt securities 23,736 — 23,736 — U.S. commercial paper 18,968 — 18,968 — Foreign commercial paper 31,449 — 31,449 — Total $ 300,842 $ 173,973 $ 126,869 $ — Fair Value Measurements at Reporting Date Using Balance at December 31, 2019 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Cash and money market funds $ 56,931 $ 56,931 $ — $ — U.S. treasury bills and government agency obligations 140,626 140,626 — — U.S. corporate debt securities 80,170 — 80,170 — Foreign corporate debt securities 23,203 — 23,203 — U.S. commercial paper 32,801 — 32,801 — Foreign commercial paper 57,241 — 57,241 — Total $ 390,972 $ 197,557 $ 193,415 $ — |
Short-term Investments (Tables)
Short-term Investments (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Short Term Investments [Abstract] | |
Summary of Short-term Investments | The following is a summary of our short-term investments (in thousands): June 30, 2020 Gross Gross Amortized Unrealized Unrealized Estimated Cost Gains Losses Fair Value U.S. treasury bills and government agency obligations $ 100,309 $ 560 $ — $ 100,869 U.S. corporate debt securities 44,861 231 — 45,092 Foreign corporate debt securities 23,574 162 — 23,736 U.S. commercial paper 18,968 — — 18,968 Foreign commercial paper 31,449 — — 31,449 Total $ 219,161 $ 953 $ — $ 220,114 December 31, 2019 Gross Gross Amortized Unrealized Unrealized Estimated Cost Gains Losses Fair Value U.S. treasury bills and government agency obligations $ 140,567 $ 59 $ — $ 140,626 U.S. corporate debt securities 80,159 11 — 80,170 Foreign corporate debt securities 23,188 15 — 23,203 U.S. commercial paper 32,801 — — 32,801 Foreign commercial paper 42,274 — — 42,274 Total $ 318,989 $ 85 $ — $ 319,074 |
Inventory (Tables)
Inventory (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventory consists of the following (in thousands): June 30, 2020 December 31, 2019 Raw materials $ 18,979 $ 6,635 Work in process 12,820 12,571 Finished goods 9,643 5,762 Total inventory $ 41,442 $ 24,968 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Leases [Abstract] | |
Summary of Future Minimum Lease Payments | Future minimum lease payments under our operating leases as of June 30, 2020 are as follows (in thousands): 2020 $ 1,922 2021 3,942 2022 4,058 2023 4,178 2024 4,274 Thereafter 4,379 Total future minimum lease payments $ 22,753 Less: discount (3,911 ) Total lease liabilities $ 18,842 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Summary of Stock Option Activity | The following table summarizes the stock option activity for the six months ended June 30, 2020: Shares (in thousands) Weighted- average Exercise Price Weighted- average Remaining Contractual Term (Years) Balance at December 31, 2019 16,665 $ 20.47 7.87 Granted 249 $ 19.24 Exercised (124 ) $ 10.57 Expired and forfeited (484 ) $ 22.57 Balance at June 30, 2020 16,306 $ 20.46 7.31 |
Summary of Stock-Based Compensation Expense related to Stock-Based Payment Awards Granted | The following table summarizes stock-based compensation expense related to stock-based payment awards granted pursuant to all of our equity compensation arrangements (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Research and development $ 4,681 $ 4,434 $ 9,968 $ 9,758 General and administrative 3,304 3,714 6,735 7,394 Sales and marketing 3,129 4,558 6,385 13,456 Total stock-based compensation expense $ 11,114 $ 12,706 $ 23,088 $ 30,608 |
Summary of Fair Value of Option Grant on Grant Date Using Black-Scholes Option Pricing Model | We estimated the fair value of each option grant on the grant date using the Black-Scholes option pricing model with the following weighted-average assumptions: June 30, 2020 2019 Risk-free interest rate 1.1 % 2.4 % Dividend yield 0.0 % 0.0 % Volatility 66.7 % 68.0 % Expected life (years) 6 6 |
1997 Employee Stock Purchase Plan | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Summary of Fair Value of Option Grant on Grant Date Using Black-Scholes Option Pricing Model | We estimated the fair value of each purchase right granted under our 1997 Employee Stock Purchase Plan, as amended, at the beginning of each new offering period using the Black-Scholes option pricing model with the following weighted-average assumptions: June 30, 2020 2019 Risk-free interest rate 0.1 % 2.4 % Dividend yield 0.0 % 0.0 % Volatility 63.3 % 58.4 % Expected life (months) 6 6 |
Business - Additional Informati
Business - Additional Information (Details) $ in Millions | Jun. 30, 2020USD ($) |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Cash, cash equivalents and short-term investments | $ 300.8 |
Accounting Policies - Percentag
Accounting Policies - Percentage of Net Product Sales and Accounts Receivable Balance (Details) - Customer Concentration Risk | 3 Months Ended | 6 Months Ended |
Jun. 30, 2020 | Jun. 30, 2020 | |
Revenue Benchmark | ||
Product Information [Line Items] | ||
Concentration risk percentage | 98.00% | 98.10% |
Revenue Benchmark | Largest Customer | ||
Product Information [Line Items] | ||
Concentration risk percentage | 44.50% | 42.50% |
Revenue Benchmark | Second Largest Customer | ||
Product Information [Line Items] | ||
Concentration risk percentage | 32.20% | 34.50% |
Revenue Benchmark | Third Largest Customer | ||
Product Information [Line Items] | ||
Concentration risk percentage | 21.30% | 21.10% |
Accounts Receivable | ||
Product Information [Line Items] | ||
Concentration risk percentage | 99.20% | |
Accounts Receivable | Largest Customer | ||
Product Information [Line Items] | ||
Concentration risk percentage | 56.10% | |
Accounts Receivable | Second Largest Customer | ||
Product Information [Line Items] | ||
Concentration risk percentage | 32.20% | |
Accounts Receivable | Third Largest Customer | ||
Product Information [Line Items] | ||
Concentration risk percentage | 10.90% |
Accounting Policies - Additiona
Accounting Policies - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Product Information [Line Items] | ||||
Net product sales | $ 22,668 | $ 36,659 | $ 48,068 | $ 68,261 |
CINVANTI | ||||
Product Information [Line Items] | ||||
Net product sales | 22,600 | 33,200 | 47,800 | 61,200 |
SUSTOL | ||||
Product Information [Line Items] | ||||
Net product sales | $ 100 | $ 3,500 | $ 300 | $ 7,100 |
Accounting Policies - Summary o
Accounting Policies - Summary of Activity to Product Returns, Distributor Fees and Discounts, Rebates and Administrative Fees (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2020USD ($) | |
Product Information [Line Items] | |
Balance | $ 27,939 |
Provision | 58,697 |
Payments/credits | (67,526) |
Balance | 19,110 |
Product Returns | |
Product Information [Line Items] | |
Balance | 2,351 |
Provision | 382 |
Payments/credits | (100) |
Balance | 2,633 |
Distributor Fees | |
Product Information [Line Items] | |
Balance | 3,999 |
Provision | 8,215 |
Payments/credits | (8,843) |
Balance | 3,371 |
Discounts, Rebates and Administrative Fees | |
Product Information [Line Items] | |
Balance | 21,589 |
Provision | 50,100 |
Payments/credits | (58,583) |
Balance | $ 13,106 |
Accounting Policies - Common St
Accounting Policies - Common Stock Equivalents Excluded From Computation of Net Loss Per Share (Details) - shares shares in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Share-based Payment Arrangement, Option | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Shares excluded (in shares) | 16,306 | 13,545 |
Warrant | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Shares excluded (in shares) | 220 | 640 |
Convertible Debt Securities | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Shares excluded (in shares) | 9,231 | 8,729 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Financial Assets Measured on a Recurring Basis (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | $ 220,114 | $ 319,074 |
U.S. Treasury Bills and Government Agency Obligations | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | 100,869 | 140,626 |
U.S. Corporate Debt Securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | 45,092 | 80,170 |
Foreign Corporate Debt Securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | 23,736 | 23,203 |
U.S. Commercial Paper | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | 18,968 | 32,801 |
Fair Value, Recurring | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total | 300,842 | 390,972 |
Fair Value, Recurring | Foreign Commercial Paper | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | 31,449 | 57,241 |
Fair Value, Recurring | U.S. Treasury Bills and Government Agency Obligations | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | 100,869 | 140,626 |
Fair Value, Recurring | U.S. Corporate Debt Securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | 52,716 | 80,170 |
Fair Value, Recurring | Foreign Corporate Debt Securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | 23,736 | 23,203 |
Fair Value, Recurring | U.S. Commercial Paper | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | 18,968 | 32,801 |
Fair Value, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total | 173,973 | 197,557 |
Fair Value, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | U.S. Treasury Bills and Government Agency Obligations | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | 100,869 | 140,626 |
Fair Value, Recurring | Significant Other Observable Inputs (Level 2) | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total | 126,869 | 193,415 |
Fair Value, Recurring | Significant Other Observable Inputs (Level 2) | Foreign Commercial Paper | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | 31,449 | 57,241 |
Fair Value, Recurring | Significant Other Observable Inputs (Level 2) | U.S. Corporate Debt Securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | 52,716 | 80,170 |
Fair Value, Recurring | Significant Other Observable Inputs (Level 2) | Foreign Corporate Debt Securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | 23,736 | 23,203 |
Fair Value, Recurring | Significant Other Observable Inputs (Level 2) | U.S. Commercial Paper | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Available-for-sale securities | 18,968 | 32,801 |
Fair Value, Recurring | Cash and Money Market Funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash and money market funds | 73,104 | 56,931 |
Fair Value, Recurring | Cash and Money Market Funds | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash and money market funds | $ 73,104 | $ 56,931 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2020 | Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | ||
Financial instruments transferred among fair value hierarchy levels | $ 0 | |
Cash equivalents included of available-for-sale securities | 7,600,000 | $ 15,000,000 |
Available for sale securities with contractual maturities of three months to one year. | 205,700,000 | 279,700,000 |
Available for sale securities with contractual maturities greater than one year | $ 14,400,000 | $ 39,400,000 |
Short-term Investments - Summar
Short-term Investments - Summary of Short-term Investments (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Schedule Of Available For Sale Securities [Line Items] | ||
Available-for-sale securities, amortized cost | $ 219,161 | $ 318,989 |
Available-for-sale securities, gross unrealized gains | 953 | 85 |
Available-for-sale securities | 220,114 | 319,074 |
U.S. Treasury Bills and Government Agency Obligations | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Available-for-sale securities, amortized cost | 100,309 | 140,567 |
Available-for-sale securities, gross unrealized gains | 560 | 59 |
Available-for-sale securities | 100,869 | 140,626 |
U.S. Corporate Debt Securities | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Available-for-sale securities, amortized cost | 44,861 | 80,159 |
Available-for-sale securities, gross unrealized gains | 231 | 11 |
Available-for-sale securities | 45,092 | 80,170 |
Foreign Corporate Debt Securities | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Available-for-sale securities, amortized cost | 23,574 | 23,188 |
Available-for-sale securities, gross unrealized gains | 162 | 15 |
Available-for-sale securities | 23,736 | 23,203 |
U.S. Commercial Paper | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Available-for-sale securities, amortized cost | 18,968 | 32,801 |
Available-for-sale securities | 18,968 | 32,801 |
Foreign Commercial Paper | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Available-for-sale securities, amortized cost | 31,449 | 42,274 |
Available-for-sale securities | $ 31,449 | $ 42,274 |
Short-term Investments - Additi
Short-term Investments - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Short Term Investments [Abstract] | ||||
Debt securities, impairment losses | $ 0 | $ 0 | $ 0 | $ 0 |
Debt securities, available-for-sale, realized gain (loss) | $ 0 | $ 0 | $ 0 | $ 8,000 |
Inventory - Schedule of Invento
Inventory - Schedule of Inventory (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 18,979 | $ 6,635 |
Work in process | 12,820 | 12,571 |
Finished goods | 9,643 | 5,762 |
Total inventory | $ 41,442 | $ 24,968 |
Inventory - Additional Informat
Inventory - Additional Information (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2020 | Dec. 31, 2019 | |
Inventory [Line Items] | |||
Total inventory | $ 41,442 | $ 24,968 | |
CINVANTI | |||
Inventory [Line Items] | |||
Total inventory | 39,700 | 23,500 | |
SUSTOL | |||
Inventory [Line Items] | |||
Total inventory | $ 1,700 | $ 1,500 | |
Cost of product sales, charges | $ 1,600 |
Leases - Additional Information
Leases - Additional Information (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | |
Dec. 31, 2019USD ($)ft² | Jun. 30, 2020USD ($) | Jun. 30, 2020USD ($) | Jan. 01, 2019USD ($) | |
Lessee Lease Description [Line Items] | ||||
Right-of-use lease assets | $ 13,754 | $ 17,594 | $ 17,594 | |
Operating lease, initial lease liabilities | 18,842 | 18,842 | ||
Operating lease, expense | 1,000 | 2,000 | ||
Operating lease, payments | $ 1,000 | $ 1,700 | ||
Accounting Standards Update 2016-02 | ||||
Lessee Lease Description [Line Items] | ||||
Right-of-use lease assets | $ 13,700 | |||
Operating lease, initial lease liabilities | $ 14,500 | |||
San Diego, California | ||||
Lessee Lease Description [Line Items] | ||||
Area of real estate property | ft² | 21,180 | |||
Lease commencement date | Jan. 1, 2020 | |||
Lease expiration date | Dec. 31, 2025 | |||
Lessee, operating lease, renewal term | 5 years | |||
Lessee, operating lease, existence of option to extend | true | |||
Operating leases, remaining lease term | 66 months | 66 months |
Leases - Summary of Future Mini
Leases - Summary of Future Minimum Lease Payments (Details) $ in Thousands | Jun. 30, 2020USD ($) |
Leases [Abstract] | |
2020 | $ 1,922 |
2021 | 3,942 |
2022 | 4,058 |
2023 | 4,178 |
2024 | 4,274 |
Thereafter | 4,379 |
Total future minimum lease payments | 22,753 |
Less: discount | (3,911) |
Total lease liabilities | $ 18,842 |
Secured Notes to Related Party
Secured Notes to Related Party - Additional Information (Details) | Jul. 29, 2011shares | Apr. 30, 2011USD ($)Dayshares | Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2020USD ($)shares | Jun. 30, 2019USD ($) |
Debt Instrument [Line Items] | ||||||
Proceeds from convertible debt | $ 4,300,000 | |||||
Amortization of debt discount | $ 645,000 | $ 507,000 | ||||
Debt instrument, convertible, number shares of equity instruments | shares | 9,200,000 | |||||
Convertible Notes | ||||||
Debt Instrument [Line Items] | ||||||
Convertible debt issuable in connection with private placement | $ 4,500,000 | |||||
Debt instrument, interest rate | 6.00% | |||||
Debt instrument, maturity date | May 2, 2021 | |||||
Debt instrument conversion ratio multiple of principal | $ 1,000 | |||||
Beneficial ownership after conversion | 9.99% | |||||
Notice period associated with beneficial ownership percentage limitation convertible notes | Day | 61 | |||||
Common shares registered for resale in connection with convertible notes | shares | 3,500,000 | |||||
Debt instrument, term | 10 years | |||||
Paid-in-kind interest | $ 200,000 | |||||
Debt instrument, additional debt discount | 200,000 | |||||
Interest expense, debt, excluding amortization | $ 100,000 | $ 100,000 | 200,000 | 200,000 | ||
Amortization of debt discount | 300,000 | $ 300,000 | 600,000 | $ 500,000 | ||
Carrying value of debt | 6,300,000 | 6,300,000 | ||||
Debt instrument, face amount | 7,400,000 | 7,400,000 | ||||
Debt instrument, unamortized discount, total | $ 1,100,000 | $ 1,100,000 | ||||
Convertible Notes | Common Stock | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, number of shares issued for convertible notes | shares | 1,250 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||
Oct. 31, 2019 | Jun. 30, 2014 | Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Class Of Stock [Line Items] | ||||||||
Proceeds from issuance of common stock | $ 162,200,000 | |||||||
Shares of common stock issued pursuant to exercise of stock options | 124,000 | |||||||
Proceeds from stock option exercises | $ 1,309,000 | $ 16,215,000 | ||||||
Total unrecognized compensation cost related to non-vested, stock-based payment awards | $ 103,000,000 | $ 103,000,000 | ||||||
Total unrecognized compensation cost, expect to recognize over weighted average period | 2 years 8 months 12 days | |||||||
Pre-funded Warrants | ||||||||
Class Of Stock [Line Items] | ||||||||
Class of warrant or right, number of securities called by warrants or rights | 600,000 | |||||||
Class of warrant or right, exercise price of warrants or rights | $ 0.01 | |||||||
Class of warrant or right, expiration date | Jun. 30, 2021 | |||||||
Class of warrant or right, exercised during period | 267,870 | |||||||
Proceeds from issuance of warrants | $ 2,679 | |||||||
Class of warrant or right, outstanding | 195,574 | 195,574 | ||||||
Common Stock | ||||||||
Class Of Stock [Line Items] | ||||||||
Number of shares issued | 9,900,000 | |||||||
Share price | $ 17.50 | |||||||
Payments of stock issuance costs | $ 10,300,000 | |||||||
Issuance of common stock on exercise of warrants (in shares) | 268,000 | |||||||
Shares of common stock issued pursuant to exercise of stock options | 54,000 | 70,000 | 810,000 | 732,000 | ||||
Common Stock | Pre-funded Warrants | ||||||||
Class Of Stock [Line Items] | ||||||||
Issuance of common stock on exercise of warrants (in shares) | 267,870 |
Stockholders' Equity - Summary
Stockholders' Equity - Summary of Stock Option Activity (Details) - $ / shares | 6 Months Ended | 12 Months Ended |
Jun. 30, 2020 | Dec. 31, 2019 | |
Equity [Abstract] | ||
Number of shares outstanding | 16,665,000 | |
Number of shares granted | 249,000 | |
Number of shares exercised | (124,000) | |
Number of shares expired and forfeited | (484,000) | |
Number of shares outstanding | 16,306,000 | 16,665,000 |
Number of shares outstanding, weighted average exercise price | $ 20.47 | |
Number of shares granted, weighted average exercise price | 19.24 | |
Number of shares exercised, weighted average exercise price | 10.57 | |
Number of shares expired and forfeited, weighted average exercise price | 22.57 | |
Number of shares outstanding, weighted average exercise price | $ 20.46 | $ 20.47 |
Number of shares outstanding, weighted average remaining contractual term (Year) | 7 years 3 months 21 days | 7 years 10 months 13 days |
Stockholders' Equity - Summar_2
Stockholders' Equity - Summary of Stock-Based Compensation Expense related to Stock-Based Payment Awards Granted (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 11,114 | $ 12,706 | $ 23,088 | $ 30,608 |
Research and Development Expense | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock-based compensation expense | 4,681 | 4,434 | 9,968 | 9,758 |
General and Administrative Expense | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock-based compensation expense | 3,304 | 3,714 | 6,735 | 7,394 |
Selling and Marketing Expense | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 3,129 | $ 4,558 | $ 6,385 | $ 13,456 |
Stockholders' Equity - Summar_3
Stockholders' Equity - Summary of Fair Value of Option Grant on Grant Date Using Black-Scholes Option Pricing Model (Details) | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Share-based Payment Arrangement, Option | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Risk-free interest rate | 1.10% | 2.40% |
Dividend yield | 0.00% | 0.00% |
Volatility | 66.70% | 68.00% |
Expected life | 6 years | 6 years |
1997 Employee Stock Purchase Plan | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Risk-free interest rate | 0.10% | 2.40% |
Dividend yield | 0.00% | 0.00% |
Volatility | 63.30% | 58.40% |
Expected life | 6 months | 6 months |