Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Feb. 21, 2023 | Jun. 30, 2022 | |
Document and Entity Information | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Period End Date | Dec. 31, 2022 | ||
Entity File Number | 0-17999 | ||
Entity Registrant Name | ImmunoGen, Inc. | ||
Entity Incorporation, State or Country Code | MA | ||
Entity Tax Identification Number | 04-2726691 | ||
Entity Address, Address Line One | 830 Winter Street | ||
Entity Address, City or Town | Waltham | ||
Entity Address, State or Province | MA | ||
Entity Address, Postal Zip Code | 02451 | ||
City Area Code | 781 | ||
Local Phone Number | 895-0600 | ||
Title of 12(b) Security | Common Stock | ||
Trading Symbol | IMGN | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
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 | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 226,046,108 | ||
Entity Central Index Key | 0000855654 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Public Float | $ 989,665,866 | ||
Auditor Name | Ernst & Young LLP | ||
Auditor Firm ID | 42 | ||
Auditor Location | Boston, Massachusetts |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
ASSETS | ||
Cash and cash equivalents | $ 275,138 | $ 478,750 |
Accounts receivable | 12,596 | 4,467 |
Unbilled receivable | 1,531 | 2,345 |
Contract assets | 0 | 3,000 |
Non-cash royalty receivable | 3,851 | 4,115 |
Prepaid and other current assets | 11,005 | 7,322 |
Total current assets | 304,121 | 499,999 |
Property and equipment, net of accumulated depreciation | 4,377 | 4,663 |
Operating lease right-of-use assets | 10,231 | 12,392 |
Long-term inventory | 16,196 | |
Other assets | 14,011 | 8,711 |
Total assets | 348,936 | 525,765 |
LIABILITIES AND SHAREHOLDERS' EQUITY | ||
Accounts payable | 45,353 | 18,434 |
Accrued compensation | 11,111 | 5,469 |
Other accrued liabilities | 38,783 | 23,077 |
Current portion of liability related to the sale of future royalties, net of deferred financing costs of $162 and $198, respectively | 8,659 | 6,077 |
Current portion of operating lease liability | 4,096 | 3,537 |
Current portion of deferred revenue | 13,856 | 44,351 |
Total current liabilities | 121,858 | 100,945 |
Deferred revenue, net of current portion | 36,355 | 47,717 |
Operating lease liability, net of current portion | 11,148 | 15,244 |
Liability related to the sale of future royalties, net of current portion and deferred financing costs of $205 and $381, respectively | 23,449 | 34,967 |
Other long-term liabilities | 300 | 1,306 |
Total liabilities | 193,110 | 200,179 |
Commitments and contingencies (Note L) | ||
Shareholders' equity: | ||
Preferred stock, $.01 par value; authorized 5,000 shares; no shares issued and outstanding as of each of December 31, 2022 and 2021 | ||
Common stock, $.01 par value; authorized 600,000 shares; 226,046 and 220,361 shares issued and outstanding as of December 31, 2022 and 2021, respectively | 2,260 | 2,204 |
Additional paid-in capital | 1,847,638 | 1,794,525 |
Accumulated deficit | (1,694,072) | (1,471,143) |
Total shareholders' equity | 155,826 | 325,586 |
Total liabilities and shareholders' equity | $ 348,936 | $ 525,765 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
CONSOLIDATED BALANCE SHEETS | ||
Sale of future royalties, current portion and deferred financing costs | $ 162 | $ 198 |
Sale of future royalties, noncurrent portion and deferred financing costs | $ 205 | $ 381 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, authorized shares | 5,000 | 5,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized shares | 600,000 | 600,000 |
Common stock, issued shares | 226,046 | 220,361 |
Common stock, outstanding shares | 226,046 | 220,361 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Revenues: | |||
Total revenues | $ 108,782 | $ 69,856 | $ 132,299 |
Cost and operating expenses: | |||
Cost of sales | 176 | ||
Research and development | 213,370 | 151,117 | 114,592 |
Selling, general and administrative | 116,129 | 43,812 | 38,600 |
Restructuring charge | 1,487 | ||
Total cost and operating expenses | 329,675 | 194,929 | 154,679 |
Loss from operations | (220,893) | (125,073) | (22,380) |
Investment income, net | 4,341 | 51 | 729 |
Non-cash interest expense on liability related to the sale of future royalties and convertible senior notes | (4,165) | (13,103) | (23,107) |
Interest expense on convertible senior notes | (47) | (95) | |
Other (expense) income, net | (994) | (1,131) | 481 |
Net loss before income taxes | (221,711) | (139,303) | (44,372) |
Income tax expense | 1,218 | 0 | 0 |
Net loss | $ (222,929) | $ (139,303) | $ (44,372) |
Basic net loss per common share | $ (0.88) | $ (0.68) | $ (0.25) |
Diluted net loss per common share | $ (0.88) | $ (0.68) | $ (0.25) |
Basic weighted average common shares outstanding (in shares) | 253,631 | 206,147 | 176,153 |
Diluted weighted average common shares outstanding (in shares) | 253,631 | 206,147 | 176,153 |
Total comprehensive loss | $ (222,929) | $ (139,303) | $ (44,372) |
License and milestone fees | |||
Revenues: | |||
Total revenues | 76,027 | 22,650 | 63,742 |
Non-cash royalty revenue related to the sale of future royalties | |||
Revenues: | |||
Total revenues | 29,261 | 46,808 | 68,529 |
Research and development support | |||
Revenues: | |||
Total revenues | 940 | $ 398 | $ 28 |
Product revenue, net | |||
Revenues: | |||
Total revenues | $ 2,554 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Total |
Balance at Dec. 31, 2019 | $ 1,501 | $ 1,209,846 | $ (1,287,468) | $ (76,121) |
Balance (in shares) at Dec. 31, 2019 | 150,136 | |||
Increase (Decrease) in Shareholders' Equity (Deficit) | ||||
Net loss | (44,372) | (44,372) | ||
Issuance of common stock pursuant to the exercise of stock options and employee stock purchase plan | $ 5 | 1,466 | 1,471 | |
Issuance of common stock pursuant to the exercise of stock options and employee stock purchase plan (in shares) | 458 | |||
Issuance of common stock, net of issuance costs | $ 445 | 193,826 | 194,271 | |
Issuance of common stock, net of issuance costs (in shares) | 44,496 | |||
Restricted stock award forfeitures | $ (5) | 5 | ||
Restricted stock award forfeitures (in shares) | (487) | |||
Restricted stock units vested | $ 4 | (4) | ||
Restricted stock units vested (in shares) | 395 | |||
Stock option and restricted stock compensation expense | 13,978 | 13,978 | ||
Directors' deferred share unit compensation | 343 | 343 | ||
Balance at Dec. 31, 2020 | $ 1,950 | 1,419,460 | (1,331,840) | 89,570 |
Balance (in shares) at Dec. 31, 2020 | 194,998 | |||
Increase (Decrease) in Shareholders' Equity (Deficit) | ||||
Net loss | (139,303) | (139,303) | ||
Issuance of common stock pursuant to the exercise of stock options and employee stock purchase plan | $ 10 | 3,759 | 3,769 | |
Issuance of common stock pursuant to the exercise of stock options and employee stock purchase plan (in shares) | 998 | |||
Issuance of common stock, net of issuance costs | $ 242 | 153,788 | 154,030 | |
Issuance of common stock, net of issuance costs (in shares) | 24,181 | |||
Conversion of convertible senior notes | $ 3 | 997 | 1,000 | |
Conversion of convertible senior notes (in shares) | 239 | |||
Issuance of pre-funded warrants, net of issuance costs | 199,045 | 199,045 | ||
Restricted stock award forfeitures | $ (1) | 1 | ||
Restricted stock award forfeitures (in shares) | (57) | |||
Restricted stock units vested (in shares) | 2 | |||
Stock option and restricted stock compensation expense | 16,794 | 16,794 | ||
Directors' deferred share unit compensation | 681 | 681 | ||
Balance at Dec. 31, 2021 | $ 2,204 | 1,794,525 | (1,471,143) | $ 325,586 |
Balance (in shares) at Dec. 31, 2021 | 220,361 | 220,361 | ||
Increase (Decrease) in Shareholders' Equity (Deficit) | ||||
Net loss | (222,929) | $ (222,929) | ||
Issuance of common stock pursuant to the exercise of stock options and employee stock purchase plan | $ 5 | 1,900 | 1,905 | |
Issuance of common stock pursuant to the exercise of stock options and employee stock purchase plan (in shares) | 491 | |||
Issuance of common stock, net of issuance costs | $ 51 | 25,598 | 25,649 | |
Issuance of common stock, net of issuance costs (in shares) | 5,167 | |||
Restricted stock units vested (in shares) | 27 | |||
Stock option and restricted stock compensation expense | 24,899 | 24,899 | ||
Directors' deferred share unit compensation | 716 | 716 | ||
Balance at Dec. 31, 2022 | $ 2,260 | $ 1,847,638 | $ (1,694,072) | $ 155,826 |
Balance (in shares) at Dec. 31, 2022 | 226,046 | 226,046 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Cash flows from operating activities: | |||
Net loss | $ (222,929) | $ (139,303) | $ (44,372) |
Adjustments to reconcile net loss to net cash used for operating activities: | |||
Non-cash royalty revenue related to sale of future royalties | (12,836) | (39,155) | (68,529) |
Non-cash interest expense on liability related to sale of future royalties and convertible senior notes | 4,165 | 13,103 | 23,107 |
Depreciation and amortization | 1,783 | 2,017 | 2,101 |
Gain on sale/disposal of fixed assets and impairment charges | (691) | ||
Stock and deferred share unit compensation | 25,615 | 17,475 | 14,321 |
Change in operating assets and liabilities: | |||
Accounts receivable | (8,129) | (4,432) | 7,465 |
Unbilled receivable | 814 | (2,334) | 990 |
Inventory | (16,196) | ||
Contract asset | 3,000 | (3,000) | 3,631 |
Prepaid and other current assets | (3,683) | 579 | (2,476) |
Operating lease right-of-use assets | 2,161 | 1,680 | 1,515 |
Other assets | (5,300) | 2,275 | (7,202) |
Accounts payable | 26,735 | 9,148 | (819) |
Accrued compensation | 5,642 | 849 | (4,100) |
Other accrued liabilities | 14,750 | (7,261) | 16,734 |
Deferred revenue | (41,857) | (18,041) | (17,323) |
Operating lease liability | (3,537) | (3,016) | (2,972) |
Net cash used for operating activities | (229,802) | (169,416) | (78,620) |
Cash flows from investing activities: | |||
Proceeds from sale of equipment | 1,426 | ||
Purchases of property and equipment | (1,364) | (1,434) | (917) |
Net cash used for investing activities | (1,364) | (1,434) | 509 |
Cash flows from financing activities: | |||
Payments upon settlement of convertible senior notes | (1,100) | ||
Proceeds from issuance of common stock under stock plans | 1,905 | 3,769 | 1,471 |
Proceeds from warrant issuance, net of $391 of transaction costs | 199,045 | ||
Proceeds from common stock issuance, net of $373 and $701 of transaction costs, respectively | 25,649 | 154,030 | 194,271 |
Net cash provided by financing activities | 27,554 | 355,744 | 195,742 |
Net change in cash and cash equivalents | (203,612) | 184,894 | 117,631 |
Cash and cash equivalents, beginning of period | 478,750 | 293,856 | 176,225 |
Cash and cash equivalents, end of period | $ 275,138 | 478,750 | 293,856 |
Supplemental cash flow information: | |||
Cash paid during the year for interest | $ 47 | $ 95 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||
Transaction costs | $ 373 | $ 701 | |
Proceeds from common stock issuance, transaction costs | $ 391 | $ 391 | $ 391 |
Nature of Business and Plan of
Nature of Business and Plan of Operations | 12 Months Ended |
Dec. 31, 2022 | |
Nature of Business and Plan of Operations | |
Nature of Business and Plan of Operations | IMMUNOGEN, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS A. Nature of Business and Plan of Operations ImmunoGen, Inc. (the Company) was incorporated in Massachusetts in 1981 and is focused on the development and commercialization of antibody-drug conjugates, or ADCs. On November 14, 2022, the U.S. Food and Drug Administration (FDA) granted accelerated approval for ELAHERE™ (mirvetuximab soravtansine-gynx) for the treatment of adult patients with folate receptor alpha (FRα)-positive, platinum-resistant epithelial ovarian, fallopian tube, or primary peritoneal cancer, who have received one to three prior systemic treatment regimens. ELAHERE was approved under FDA's accelerated approval program based on objective response rate (ORR), duration of response (DOR), and safety data from the pivotal SORAYA trial. Continued approval may be contingent upon verification and description of clinical benefit in a confirmatory trial. The Company has generally incurred operating losses and negative cash flows from operations since inception, incurred a net loss of $222.9 million during the year ended December 31, 2022, and had an accumulated deficit of approximately $1.7 billion as of December 31, 2022. The Company has primarily funded these losses through payments received from its collaborations and equity, convertible debt, and other financings such as royalty financing transactions. Until the Company can generate significant cash flows from sales of ELAHERE, management expects to continue to generate substantial operating losses for at least the near term as the Company incurs significant operating expenses related to research and development and selling and marketing of ELAHERE. At December 31, 2022, the Company had $275.1 million of cash and cash equivalents on hand. The Company’s current level of cash and cash equivalents is not sufficient to meet its current operating plans for the next twelve months following the issuance of these financial statements. As a result, substantial doubt is deemed to exist regarding the Company’s ability to continue as a going concern for a period of one year from the issuance of these financial statements. The Company plans to meet its operating cash flow requirements with its current cash and cash equivalents, cash generated from commercial sales of ELAHERE, milestone payments from new or existing collaborations, and additional funds accessed through equity, debt, or other financings such as royalty financing transactions, as well as cash preservation activities. Such activities may not succeed. The failure of the Company to obtain sufficient funds on acceptable terms could have a material adverse effect on the Company’s business, results of operations, and financial condition and require the Company to defer or limit some or all of its research, development, clinical and/or commercial projects, including trials to support potential label expansion of ELAHERE. The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty. The Company is subject to risks common to companies in the biotechnology industry including, but not limited to, the development by its competitors of new technological innovations, dependence on key personnel, protection of proprietary technology, manufacturing and marketing limitations, challenges entering into new collaborations, complexities associated with managing collaboration arrangements, third-party reimbursements, and compliance with governmental regulations. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies | |
Basis of Presentation and Significant Accounting Policies | B. Summary of Significant Accounting Policies Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, ImmunoGen Switzerland GmbH, ImmunoGen U.S. Holding, Inc., ImmunoGen Securities Corp., ImmunoGen Europe Limited, ImmunoGen BioPharma (Ireland) Limited, and Hurricane, LLC. All intercompany transactions and balances have been eliminated. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States (U.S.) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Subsequent Events The Company has evaluated all events or transactions that occurred after December 31, 2022 up through the date the Company issued these financial statements. On February 28, 2023, the Company and Vertex Pharmaceuticals Incorporated (“Vertex”) entered into a multi-target license and option agreement, pursuant to which the Company granted Vertex rights to the Company’s ADC technology to research and evaluate ADCs directed to specified targets, with an option to take exclusive development and commercialization licenses to a specified number of targets over a specified term. Under the terms of the agreement, the Company is entitled to receive an upfront payment of $15.0 million. The Revenue Recognition Product Revenue The Company generates product revenue from sales of ELAHERE its products Product revenue is recognized when the customer takes control of the product, typically upon delivery to the customer. Product revenue is recorded at the net sales price, or transaction price, which includes estimated reserves for variable consideration resulting from chargebacks, government rebates, trade discounts and allowances, product returns and other incentives that are offered within the contract with customers, healthcare providers, payors and other indirect customers relating to the sales of the Company’s product. Reserves are established based on the amounts earned or to be claimed on the related sales. Where appropriate, the Company utilizes the expected value method to determine the appropriate amount for estimates of variable consideration based on factors such as the Company’s current contractual and statutory requirements, specific known market events and trends, industry data and forecasted customer buying and payment patterns, the percentage of our products that are sold via these programs, and our product pricing. The amount of variable consideration that is included in the transaction price may be constrained and is included in net product revenues only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from the Company’s estimates. If actual results vary from the Company’s estimates, the Company adjusts these estimates, which would affect net product revenue and earnings in the period such variances become known. Chargebacks: expected value method based upon a range of possible outcomes and are established in the same period that the related revenue is recognized, resulting in a reduction of product revenue. Government rebates: Trade discounts and allowances: Product returns: Other deductions: The Company entered into a third-party logistics distribution agreement (the 3PL Agreement) to engage a logistics distribution agent (the 3PL Agent) to distribute the Company’s products to its customers. The 3PL Agent provides services to the Company that include support, electronic data interface and system access support. As a practical expedient, sales commissions, which represent costs to obtain a contract, are expensed when incurred because the amortization period would have been one year or less. Sales commissions are recorded in selling, general and administrative expense and costs of sales, respectively, in the statements of operations and comprehensive loss. Additionally, as a practical expedient, the Company has elected to License and Milestone Fee Revenue The Company enters into licensing and development agreements with collaborators for the development of ADCs. The terms of these agreements contain multiple promised goods and services which may include (i) licenses, or options to obtain licenses, to the Company’s ADC technology, (ii) rights to future technological improvements, (iii) technology transfer services and other activities to be performed on behalf of the collaborative partner, and (iv) delivery of cytotoxic agents and/or the manufacture of preclinical and clinical materials for the collaborative partner. Payments to the Company under these agreements may include upfront fees, option fees, exercise fees, payments for services, payments for preclinical or clinical materials, payments based upon the achievement of certain milestones, and royalties on product sales. The Company follows the provisions of ASC 606, Revenue from Contracts with Customers, Revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. In determining the appropriate amount of revenue to be recognized as it fulfills its obligations under the agreements, the Company performs the following five steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when or as the Company satisfies each performance obligation. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration to which it is entitled in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract and determines those that are performance obligations based on its assessment of whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when or as the performance obligation is satisfied. The Company exercises judgment in assessing those promised goods and services that are distinct and thus representative of performance obligations. To the extent the Company identifies multiple performance obligations in a contract, the Company must develop assumptions that require judgment to determine the estimated standalone selling price for each performance obligation in order to allocate the transaction price among the identified performance obligations. These judgments and assumptions are discussed in further detail below. At December 31, 2022, the Company had the following types of agreements with the parties identified below: ● Development and commercialization licenses, which provide the counterparty with the right to use the Company’s ADC technology and/or certain other intellectual property to develop and commercialize compounds to a specified antigen target: Bayer (one exclusive single-target license) CytomX (two exclusive single-target licenses) Debiopharm (one exclusive single-compound license) Eli Lilly and Company (multiple exclusive single-target licenses) Fusion Pharmaceuticals (one exclusive single-target license) Hangzhou Zhongmei Huadong Pharmaceutical Co., Ltd. (one territory-specific exclusive single-compound license) Magenta Therapeutics (one exclusive single-target license) Novartis (one exclusive single-target licenses) Oxford BioTherapeutics/Menarini (one exclusive single-target license sublicensed from Amgen) Roche, through its Genentech unit (five exclusive single-target licenses) Viridian (one exclusive single-target license) ● Collaboration and license agreement to co-develop and co-commercialize a specified anticancer compound on established terms: MacroGenics During the year ended December 31, 2022, pursuant to notice received, certain exclusive development and commercialization licenses granted to Novartis were terminated. There are no performance, cancellation, termination, or refund provisions in any of the arrangements that contain material financial consequences to the Company. Development and Commercialization Licenses The obligations under a development and commercialization license agreement generally include the license to the Company’s ADC technology with respect to a specified antigen target or compound and may also include obligations related to rights to future technological improvements and other activities to be performed on behalf of the collaborative partner. Generally, development and commercialization licenses contain non-refundable terms for payments and, depending on the terms of the agreement, provide that the Company will earn payments upon the achievement of certain milestones and royalty payments, generally until the later of the last applicable patent expiration or a fixed period of years after product launch. Royalty rates may vary over the royalty term depending on the Company’s intellectual property rights and/or the presence of comparable competing products. In certain instances, the Company may also provide cytotoxic agents and/or clinical materials or other services in addition to the development and commercialization licenses. For example, the Company may provide technology transfer services in connection with the out-licensing of product candidates initially developed by the Company and may also provide technical assistance and share any technology improvements with its collaborators during the term of the collaboration agreements. The Company does not directly control when or whether any collaborator will request certain services, achieve milestones, or become liable for royalty payments. In determining the performance obligations for these arrangements, management evaluates whether the license is distinct and has significant standalone functionality either alone or with other readily available resources based on the consideration of the relevant facts and circumstances for each arrangement. Factors considered in this determination include the research capabilities of the partner and the availability of ADC technology research expertise and ADC manufacturing capabilities in the general marketplace and whether technological improvements are required for the continued functionality of the license. If the license to the Company’s intellectual property is determined to be distinct, the Company recognizes revenues from non-refundable, upfront fees allocated to the license when the license is transferred to the customer and the customer is able to use and benefit from the license. If the license is not distinct, the license is combined with other goods or services into a single performance obligation and revenue is recognized over time. The Company estimates the standalone selling prices of the license and all other performance obligations based on market conditions, similar arrangements entered into by third parties, and entity-specific factors such as the terms of the Company’s previous collaborative agreements, recent preclinical and clinical testing results of therapeutic products that use the Company’s ADC technology, the Company’s pricing practices and pricing objectives, the likelihood that technological improvements will be made, and, if made, will be used by the Company’s collaborators, and the nature of the other services to be performed on behalf of its collaborators and market rates for similar services. The Company recognizes revenue related to technology transfer activities and other services as the services are performed. The Company is generally compensated for these activities at negotiated rates that are consistent with what other third parties would charge. The Company records amounts recognized for services performed as a component of research and development support revenue. The Company may also provide cytotoxic agents and/or preclinical and clinical materials (drug substance/drug product) to its collaborators at negotiated prices generally consistent with what other third parties would charge. The Company recognizes revenue on cytotoxic agents and/or preclinical and clinical materials when control transfers to the collaborator as a component of research and development support revenue. The Company recognizes revenue related to the rights to future technological improvements over the estimated term of the applicable license. The Company’s development and commercialization license agreements have milestone payments which for reporting purposes are aggregated into two categories: (i) development and regulatory milestones, and (ii) sales milestones. Development milestones are typically payable when a product candidate initiates or advances into different clinical trial phases. Regulatory milestones are typically payable upon submission for marketing approval with the FDA or other countries’ regulatory authorities or on receipt of actual marketing approvals for the compound or for additional indications. Sales milestones are typically payable when annual sales reach certain levels. At the inception of each arrangement, the Company evaluates any development and regulatory milestone payments to determine whether the milestone is considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price to be allocated; otherwise, such amounts are considered constrained and excluded from the transaction price. As part of its evaluation of the constraint, the Company considers numerous factors, including whether the achievement of the milestone is outside the control of the Company and contingent upon the future success of clinical trials, the collaborator’s efforts, or the receipt of regulatory approval. At the end of each subsequent reporting period, the Company re-evaluates the probability of achievement of such development or regulatory milestones and any related constraint, and if necessary, adjusts the estimate of the transaction price. In addition, the Company evaluates whether the achievement of each milestone specifically relates to the Company’s efforts to satisfy a performance obligation or transfer a distinct good or service within a performance obligation. If the achievement of a milestone is considered a direct result of the Company’s efforts to satisfy a performance obligation or transfer a distinct good or service and the receipt of the payment is based upon the achievement of the milestone, the associated milestone value is allocated to that distinct good or service. If the milestone payment is not specifically related to the Company’s effort to satisfy a performance obligation or transfer a distinct good or service, the amount is allocated to all performance obligations using the relative standalone selling price method. Amounts allocated to a satisfied performance obligation are recognized as revenue, or as a reduction of revenue, in the period in which the transaction price changes. For development and commercialization license agreements that include sales-based royalties, including milestone payments based on the level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied) in accordance with the royalty recognition constraint. Under the Company’s development and commercialization license agreements, the Company receives royalty payments based upon its licensees’ net sales of covered products. Generally, under the development and commercialization agreements, the Company receives royalty reports and payments from its licensees approximately one quarter in arrears. The Company estimates the amount of royalty revenue to be recognized based on historical and forecasted sales and/or sales information from its licensees if available. Collaboration and Option Agreements/Right-to-Test Agreements The Company’s right-to-test agreements provide collaborators the right to test the Company’s ADC technology for a defined period of time through a research, or right-to-test, license. Under both right-to-test agreements and collaboration and option agreements, collaborators may (a) “take” options, for a defined period of time, to specified targets and (b) upon exercise of those options, secure or “take” licenses to develop and commercialize products for the specified targets on established terms. Under these agreements, fees may be due to the Company (i) at the inception of the arrangement (referred to as “upfront” fees or payments), (ii) upon the opt-in to acquire a development and commercialization license(s) (referred to as exercise fees or payments earned, if any, when the development and commercialization license is “taken”), (iii) after providing services at the collaborator’s request at negotiated prices, which are generally consistent with what other third parties would charge, or (iv) upon some combination of all of these fees. The accounting for collaboration and option agreements and right-to-test agreements is dependent on the nature of the options granted to the collaborative partner. Options are considered distinct performance obligations if they provide a collaborator with a material right. Factors that are considered in evaluating whether options convey a material right include the overall objective of the arrangement, the benefit the collaborator might obtain from the agreement without exercising the options, the cost to exercise the options relative to the fair value of the licenses, and the additional financial commitments or economic penalties imposed on the collaborator as a result of exercising the options. If the Company concludes that an option provides the customer a material right, and therefore is a separate performance obligation, the Company then determines the estimated standalone selling price of the option using the following inputs: (a) estimated fair value of the license underlying each option, (b) the amount the partner would pay to exercise the option to obtain the license, and (c) probability of exercise. The Company does not control when or if any collaborator will exercise its options for development and commercialization licenses. As a result, the Company cannot predict when or if it will recognize revenues in connection with any of the foregoing. Upfront payments on development and commercialization licenses may be recognized upon delivery of the license if facts and circumstances dictate that the license is distinct from the other promised goods and services. In determining whether a collaboration and option agreement is within the scope of ASC 808, Collaborative Arrangements Transaction Price Allocated to Remaining Performance Obligations Deferred revenue under ASC 606 represents the portion of the transaction price received under various contracts for which work has not been performed (or has been partially performed) and includes unexercised contract options that are considered material rights. As of December 31, 2022, the aggregate amount of the transaction price allocated to remaining performance obligations comprising deferred revenue was $50.2 million. The Company expects to recognize revenue on approximately 28%, 70%, and 2% of the remaining performance obligations over the next 12 months, 13 61 Contract Balances from Contracts with Customers The following tables present changes in the Company’s contract assets and contract liabilities during the years ended December 31, 2022 and 2021 (in thousands): Balance at Balance at December 31, 2021 Additions Deductions Impact of Netting December 31, 2022 Contract asset $ 3,000 $ — $ (3,000) $ — $ — Contract liabilities (deferred revenue) $ 92,068 $ 7,605 $ (49,462) $ — $ 50,211 Balance at Balance at December 31, 2020 Additions Deductions Impact of Netting December 31, 2021 Contract asset $ — $ 5,500 $ (2,500) $ — $ 3,000 Contract liabilities (deferred revenue) $ 110,109 $ 4,753 $ (22,794) $ — $ 92,068 During the years ended December 31, 2022, 2021, and 2020 the Company recognized the following revenues as a result of changes in contract asset and contract liability balances in the respective periods (in thousands): Year Ended December 31, 2022 2021 2020 Revenue recognized in the period from: Amounts included in contract liabilities at the beginning of the period $ 49,462 $ 22,765 $ 61,872 Performance obligations satisfied in previous periods $ 13,661 $ 5,500 $ — The timing of revenue recognition, billings, and cash collections results in billed receivables, unbilled receivables, contract assets, and contract liabilities on the consolidated balance sheets. When consideration is received, or such consideration is unconditionally due, from a customer prior to transferring goods or services to the customer under the terms of a contract, a contract liability is recorded (under the caption deferred revenue). Contract liabilities are recognized as revenue after control of the products or services is transferred to the customer and all revenue recognition criteria have been met. The Company recorded the following during the year ended December 31, 2022: (i) pursuant to the Company’s license agreement with Hangzhou Zhongmei Huadong Pharmaceutical Co., Ltd. (Huadong), upon delivery of clinical materials in 2022, the Company recognized as license and milestone fee revenue the remaining $28.5 million of the deferred revenue balance as of December 31, 2021 related to the $45.0 million of upfront and development milestone payments previously received; (ii) pursuant to a license agreement executed with Eli Lilly and Company (Lilly) during 2022, the Company received upfront payments of $26.0 million, of which $18.4 million was recognized as license and milestone fee revenue and the remainder deferred, further details of which can be found in Note C, “Agreements”; (iii) pursuant to a license agreement executed with Magenta Therapeutics in 2022, the Company recorded $6.0 million as license and milestone fee revenue, of which $1.6 million had been previously received and recorded as deferred revenue as of December 31, 2021; (iv) $16.4 million of previously deferred non-cash royalty revenue related to the sale of rights to KADCYLA Pursuant to the Company’s license agreement with Huadong H, “Liability Related to Sale of Future Royalties.” Lastly, pursuant to a research agreement with Magenta, the Company received a During 2020, the Company recognized $60.5 million of previously deferred license revenue upon Jazz’s opt-out of its right to the last remaining license under the agreement and $3.2 million of upfront fees previously received from other partners, of which $1.4 million was included in contract liabilities at the beginning of 2020. As noted above, a $40.0 million upfront payment received in 2020 pursuant to a license agreement executed with Huadong was recorded as deferred revenue and none of this amount was recognized as revenue during 2020. Additionally, a contract asset of $3.6 million, net of $4.4 million in related contract liabilities, was recorded for two probable milestones in 2019 pursuant to license agreements with CytomX and Novartis, which were subsequently achieved and paid during 2020. Financial Instruments and Concentration of Credit Risk Cash and cash equivalents are primarily maintained with three financial institutions in the U.S. Deposits with banks may exceed the amount of insurance provided on such deposits. Generally, these deposits may be redeemed upon demand and, therefore, bear minimal risk. The Company’s cash equivalents consist of money market funds with underlying investments primarily being U.S. Government-issued securities and high quality, short-term commercial paper. Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash, cash equivalents, and marketable securities. The Company held no marketable securities as of December 31, 2022 and 2021. The Company’s investment policy, approved by the Board of Directors, limits the amount it may invest in any one type of investment, thereby reducing credit risk concentrations. Cash and Cash Equivalents All highly liquid financial instruments with maturities of three months or less when purchased are considered cash equivalents. As of December 31, 2022 and 2021, the Company held $275.1 million and $478.8 million, respectively, in cash and money market funds consisting principally of U.S. Government-issued securities and high quality, short-term commercial paper which were classified as cash and cash equivalents. Non-cash Investing Activities The Company had $0.3 million and $0.2 million of accrued capital expenditures as of December 31, 2022 and 2021, respectively, which have been treated as a non-cash investing activity and accordingly, are not reflected in the consolidated statement of cash flows. Fair Value of Financial Instruments ASC 820, Fair Value Measurement ● Level 1—Quoted prices in active markets for identical assets or liabilities. ● Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. ● Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. As of December 31, 2022 and 2021, the Company held certain assets that are required to be measured at fair value on a recurring basis. The fair value of the Company’s cash equivalents is based on quoted prices from active markets (Level 1 inputs). The carrying amounts reflected in the consolidated balance sheets for accounts receivable, unbilled receivable, contract assets, non-cash royalty receivable, prepaid and other current assets, accounts payable, accrued compensation, and other accrued liabilities approximate fair value due to their short-term nature. Accounts Receivable Accounts receivable arise from product sales and amounts due from the Company’s collaboration partners. The amount from product sales represents amounts due from specialty distributors and specialty pharmacy providers in the U.S. The Company monitors economic conditions and the financial performance and credit worthiness of its counterparties to identify facts or circumstances that may indicate that its receivables are at risk of collection. The Company provides reserves against accounts receivable for estimated losses that may result from a customer’s inability to pay based on the composition of its accounts receivable, considering past events, current economic conditions, and reasonable and supportable forecasts about the future economic conditions. The contractual life of our accounts receivable is generally short-term. Amounts determined to be uncollectible are charged or written-off against the reserve. For the years ended December 31, 2022 and 2021, the Company did not record any expected credit losses related to outstanding accounts receivable. Unbilled Receivable Unbilled receivable primarily represents research funding earned based on actual resources utilized and external expenses incurred under certain of the Company’s collaborator agreements. Inventory Inventories are stated at the lower of cost or estimated net realizable value with cost based on the first-in first-out method. Inventory that can be used in either the production of clinical or commercial products is expensed as research and development costs when identified for use in clinical trials. The Company classifies its inventory costs as long-term when it expects to utilize the inventory beyond its normal operating cycle based on forecasted levels of sales. Prior to the regulatory approval of its drug candidates, the Company incurs expenses for the manufacture of drug product to support clinical development that could potentially be available to support the commercial launch of those drugs. Until the date at which regulatory approval has been received or is otherwise considered probable, the Company records all such costs as research and development expenses. Inventory used in clinical trials is also expensed as research and development expense, when selected for such use. The Company performs an assessment of the recoverability of capitalized inventories during each reporting period and writes down any excess and obsolete inventory to its net realizable value in the period in which the impairment is first identified. Such impairment charges, should they occur, are recorded as a component of cost of sales in the consolidated statements of operations and comprehensive loss. The determination of whether inventory costs will be realizable requires the use of estimates by management. If actual market conditions are less favorable than projected by management, additional write-downs of inventory may be required. Clinical Trial Accruals Clinical trial expenses are a significant component of research and development expenses, and the Company outsources a significant portion of these activities to third parties. Third-party clinical trial expenses include investigator fees, site costs (patient cost), clinical research organization costs, and costs for central laboratory testing and data management. The accrual for site and patient costs includes inputs such as estimates of patient enrollment, patient cycles incurred, clinical site activations, and other pass-through costs. These inputs are required to be estimated due to a lag in receiving the actual clinical information from third parties. . Non-refundable advance clinical payments for goods or services that will be used or rendered for future R&D activities are recorded as a prepaid asset and recognized as expense as the related goods are delivered or the related services are performed. Leases The Company determines if an arrangement is a lease at inception. Operating leases include right-of-use (ROU) assets and operating lease liabilities (current and non-current), which are recorded in the Company’s consolidated balance sheets. Single payment capital leases for equipment that are considered finance leases are included in property and equipment in the Company’s consolidated balance sheets. As the single payment obligations have all been made, there is no related liability recorded. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The Company uses the implicit rate when readily determinable. As a number of the Company’s leases do not provide an implicit rate, the Company uses an incremental borrowing rate applicable to the Company based on the information available at the commencement date in determining the present value of lease payments. As the Company has no existing or proposed collateralized borrowing arrangements, to determine a reasonable incremental borrowing rate, the Company considers collateral assumptions, the lease term, the Company’s current credit ris |
Collaboration and License Agree
Collaboration and License Agreements | 12 Months Ended |
Dec. 31, 2022 | |
Collaboration and License Agreements | |
Collaboration and License Agreements | C. Collaboration and License Agreements The Company has numerous collaboration and license agreements with third parties. These agreements typically provide the licensee with rights to use the Company’s ADC platform technology with its antibodies or related targeting vehicles to a defined target to develop products. The licensee is generally responsible for the development, clinical testing, manufacturing, registration, and commercialization of any resulting product candidate. As part of these agreements, the Company is generally entitled to receive upfront fees, potential milestone payments, royalties on the sales of any resulting products, and research and development funding based on activities performed at our collaborative partner’s request. See below for details regarding the Company’s collaboration and license agreements with activity in the financial statement periods presented. Roche In 2000, the Company granted Genentech, now a unit of Roche, an exclusive development and commercialization license to use the Company’s maytansinoid ADC technology with antibodies, such as trastuzumab, or other proteins that target HER2. Under the terms of this agreement, Roche has exclusive worldwide rights to develop and commercialize maytansinoid ADC compounds targeting HER2. Pursuant to this agreement, Roche developed and received marketing approval for its HER2-targeting ADC, KADCYLA, in the U.S., Japan, the European Union, and numerous other countries. Roche is responsible for the manufacturing, product development, and marketing of any products resulting from the agreement. The Company received a $2.0 million non-refundable upfront payment from Roche upon execution of the agreement. The Company is also entitled to receive up to a total of $44.0 million in development and regulatory milestone payments, plus royalties on the commercial sales of KADCYLA or any other resulting products. Through December 31, 2022, the Company had received and recognized $39.0 million in milestone payments related to KADCYLA. The Company receives royalty reports and payments related to sales of KADCYLA from Roche one Roche, through its Genentech unit, also has licenses for the exclusive right to use the Company’s maytansinoid ADC technology with antibodies to four undisclosed targets, which were granted under the terms of a separate, now expired, 2000 right-to-test agreement with Genentech. For each of these licenses, the Company received a $1.0 million license fee and is entitled to receive up to a total of $38.0 million in development, regulatory, and sales-based milestone payments plus royalties on the sales of any resulting products. The Company has not received any milestone payments from these agreements through December 31, 2022. Roche is responsible for the development, manufacturing, and marketing of any products resulting from these licenses. Novartis The Company granted Novartis exclusive development and commercialization licenses to the Company’s maytansinoid and IGN ADC technology for use with antibodies to six specified targets under a now-expired right-to-test agreement established in 2010. The Company received a $45.0 million upfront payment in connection with the execution of the right-to-test agreement in 2010, $8.5 million in extension and amendment fees, and an exercise fee of $1.0 million for each of the six licenses taken. In May 2018, Novartis terminated one of its six licenses. In August 2022, Novartis terminated four of the remaining development and commercialization licenses. The Company had $2.8 million of deferred revenue associated with the terminated licenses related to the portion of the transaction price previously allocated to rights to future technological improvements. In consideration that no technological improvements would be provided to Novartis and, therefore, no unsatisfied obligations were remaining related to such licenses, the $2.8 million was recorded as revenue and is included in license and milestone fees for 2022. With respect to the remaining license, $0.8 million of deferred revenue related to the portion of the transaction price previously allocated to rights to future technological improvements continues to be amortized over the remaining estimated term of the license agreement, and we are entitled to receive up to a total of $199.5 million in potential milestone payments, of which $5.0 million has been received to date, plus royalties on the commercial sales of any resulting products. Novartis is responsible for the manufacturing, development, and marketing of any products resulting from these licenses. CytomX In 2016, the Company granted CytomX an exclusive development and commercialization license to the Company’s maytansinoid ADC technology for use with PROBODIES™ that target CD166 under a now expired reciprocal right-to-test agreement. The Company neither received nor made an upfront cash payment in connection with the execution of the right-to-test agreement or the license agreement. With respect to the development and commercialization license granted to CytomX, the Company is entitled to receive up to a total of $160.0 million in development, regulatory, and sales-based milestone payments plus royalties on the commercial sales of any resulting product. Through December 31, 2022, the Company had received and recognized an aggregate of $4.0 million in milestone payments under this agreement. In December 2019, the Company granted CytomX an exclusive development and commercialization license to maytansinoid and IGN ADC technology for use with PROBODIES™ that target EpCAM. Pursuant to the license agreement, in January 2020, the Company received a $7.5 million upfront payment. The Company is also entitled to receive up to a total of $355.0 million in development, regulatory, and sales-based milestone payments plus royalties on the commercial sales of any resulting product. The Company had not received any milestone payments under this agreement through December 31, 2022. CytomX is responsible for the manufacturing, product development, and marketing of any products resulting from these licenses. Viridian In October 2020, the Company entered into a license agreement with Viridian Therapeutics, Inc. pursuant to which the Company granted Viridian the exclusive right to develop and commercialize an insulin-like growth factor-1 receptor (IGF-1R) antibody for all non-oncology indications that do not use radiopharmaceuticals in exchange for an upfront payment, with the potential to receive up to a total of $143.0 million in development, regulatory, and sales-based milestone payments plus royalties on the commercial sales of any resulting product. Through December 31, 2022, the Company had achieved an aggregate $15.5 million in development milestone payments under the agreement, of which $10.0 million and $5.5 million was included in license and milestone fee revenue for the years ended December 31, 2022 and 2021, respectively. The $10.0 million milestone payment recorded in 2022 was included in accounts receivable as of December 31, 2022. Viridian is responsible for the manufacturing, development, and marketing of any products resulting from the license agreement. Huadong In October 2020, the Company entered into a collaboration and license agreement with Hangzhou Zhongmei Huadong Pharmaceutical Co., Ltd. (Huadong), a subsidiary of Huadong Medicine Co., Ltd. The collaboration and license agreement grants Huadong an exclusive, royalty-bearing, and sublicensable right to develop and commercialize ELAHERE (the Licensed Product) in the People’s Republic of China, Hong Kong, Macau, and Taiwan (collectively, Greater China). The Company retains exclusive rights to the Licensed Product outside of Greater China. Under the terms of the collaboration and license agreement, the Company received a non-refundable upfront payment of $40.0 million with the potential for approximately $265.0 million in development, regulatory, and sales-based milestone payments. In addition, the Company is entitled to receive tiered percentage royalties ranging from low double digits to high teens as a percentage of commercial sales of the Licensed Product, if approved, by Huadong in Greater China, subject to adjustment in specified circumstances. In December 2022 and December 2021, the Company received milestone payments of $10.0 million and $5.0 million, respectively, upon achievement of development and regulatory milestones. The Company evaluated the agreement and determined it was within the scope of ASC 606. The Company determined the promised goods and services included the license to intellectual property and know-how and the clinical supply of the Licensed Product to Huadong for a specified period. The Company concluded that the license to intellectual property and know-how is not distinct from the clinical supply of the Licensed Product because the clinical supply is essential to the use of the license and an alternative source of clinical supply is not readily available in the marketplace. Accordingly, these two promised goods and services are considered a single combined performance obligation. The Company determined there were no options in the agreement that represented material rights. The transaction price was determined to consist of the upfront payment of $40.0 million and estimated payments to be received for clinical supply of the Licensed Product. At contract inception, future development and regulatory milestones were fully constrained. Any consideration related to sales-based milestones (including royalties) will be recognized when the related sales occur as these amounts have been determined to relate predominantly to the license granted to Huadong. The Company re-evaluates the transaction price, including its estimated variable consideration included in the transaction price and all constrained amounts, at each reporting period and as uncertain events are resolved or other changes in circumstances occur. The Company determined that revenue related to the agreement would be recognized as the clinical supply of the Licensed Product is delivered to Huadong, estimated to be completed over approximately two years. Accordingly, based on clinical supply delivered to Huadong during 2022 and 2021, the Company recorded $28.5 million and $16.5 million as license and milestone fee revenue in 2022 and 2021, respectively, related to $45.0 million of upfront and milestone payments previously received and deferred. The Company also recorded $10.0 million of license and milestone fee revenue related to a regulatory milestone achieved in 2022. Lilly In February 2022, the Company entered into a license agreement with Lilly, pursuant to which the Company granted Lilly worldwide exclusive rights to research, develop, and commercialize antibody-drug conjugates based on the Company’s novel camptothecin technology. Under the terms of the license agreement, the Company received a non-refundable upfront payment of $13.0 million, reflecting initial targets selected by Lilly. During 2022, pursuant to the terms of the agreement, Lilly selected additional targets for which the Company received an additional $13.0 million in non-refundable payments. Lilly may select a pre-specified number of additional targets, with the Company eligible to receive an additional $19.5 million in exercise fees if Lilly licenses the full number of remaining additional targets over a specified period following the effective date of the license agreement, with the potential for up to $1.7 billion in development and sales-based milestone payments if all targets are selected and all milestones are realized. In addition, the Company is entitled to receive tiered royalties, on a product-by-product basis, as a percentage of worldwide annual net sales by Lilly, based on certain net sales thresholds. Lilly is responsible for all costs associated with the research, development, and commercialization of any ensuing products. The Company evaluated the agreement and determined it was within the scope of ASC 606. The Company determined the promised goods and services included an exclusive license to use the Company’s intellectual property and know-how to research, develop, and commercialize products related to each of the initial targets selected by Lilly. Each of these licenses is distinct, as Lilly can derive benefit from each license independent of any other initial target licenses. Accordingly, the license to each of the initial targets selected by Lilly represents a separate performance obligation. Lilly has the right to replace each of the initial licensed targets once during a specified term for no additional consideration. If Lilly fails to advance an initial or replacement target to a specified stage within a specified period from the date the target was selected, Lilly’s rights to the respective target will cease and will revert back to the Company. The Company determined Lilly’s right to a replacement target for each of the initial targets represented a material right. Each material right is therefore a separate performance obligation. Lilly’s right to select additional targets does not represent a material right as the target fee for each additional target is the same and is also consistent with the target fee for each of the initial targets selected by Lilly. Accordingly, each additional target selected by Lilly is accounted for as a separate arrangement. The transaction price related to the initial targets was determined to consist of the upfront payment of $13.0 million. Future development milestones have been fully constrained. Any consideration related to sales-based milestones (including royalties) will be recognized when the related sales occur as these amounts have been determined to relate predominantly to the license granted to Lilly. The transaction price of $13.0 million was allocated to the performance obligations based on their relative stand-alone selling prices. In consideration of each target being at the same stage of development at the time of the initial license or at the time of replacement and each target having approximately the same earnings potential, The license terms and accounting outlined above are the same for the additional target licenses selected. Accordingly, $9.2 million and $3.8 million of the $13.0 million transaction price was allocated to the targets selected and the material right to obtain a license to replacement targets, respectively. The Company re-evaluates the transaction price for each arrangement, including its estimated variable consideration included in the transaction price and all constrained amounts, at each reporting period and as uncertain events are resolved or other changes in circumstances occur. The transfer of intellectual property and know-how to Lilly to allow for Lilly to derive benefit from the initial and additional target licenses was completed during the three months ended March 31, 2022. As such, during 2022, the Company recognized $18.4 million of license and milestone fee revenue related to the portion of the transaction price allocated to the initial and additional target licenses. The $7.6 million allocated to the material rights to obtain licenses to replacement targets is included in long-term deferred revenue as of December 31, 2022 and will be recognized when the right is either exercised or expires. Magenta In November 2022, the Company granted Magenta an exclusive development and commercialization license to the Company’s IGN ADC technology to a specified target and a non-exclusive license to use intellectual property and know-how resulting from the collaboration to research, develop, and commercialize products directed to the specified target. Under the terms of the license agreement, the Company received non-refundable upfront payments totaling $6.0 million. The Company is also entitled to receive up to a total of $125.0 million in development, regulatory, and sales-based milestone payments plus royalties on the commercial sales of any resulting product. The Company evaluated the agreement and determined it was within the scope of ASC 606. The Company determined there was a single, combined performance obligation consisting of the license to use the Company’s intellectual property and know-how and the non-exclusive license to use intellectual property and know-how resulting from the collaboration. The transaction price was determined to consist of the upfront payments totaling $6.0 million. Future development and regulatory milestones have been fully constrained. Any consideration related to sales-based milestones (including royalties) will be recognized when the related sales occur as these amounts have been determined to relate predominantly to the license granted to Magenta. The single, combined performance obligation was satisfied during 2022, and as such, the Company recognized $6.0 million of license and milestone fee revenue in 2022. In February 2023, Magenta announced its decision to halt further development of its programs and conduct a comprehensive review of strategic alternatives focusing on maximizing shareholder value. As part of this review process, Magenta will explore potential strategic alternatives that may include, but are not limited to, an acquisition, merger, business combination, or other transaction. Terminated Agreements Jazz Pharmaceuticals In August 2017, the Company entered into a Collaboration and Option Agreement with Jazz Pharmaceuticals Ireland Limited (Jazz), a subsidiary of Jazz Pharmaceuticals plc, granting Jazz exclusive, worldwide rights to opt into development and commercialization of two early-stage, hematology-related ADC programs, as well as an additional program to be designated during the term of the agreement. Pursuant to the agreement, Jazz made an upfront payment of $75.0 million to the Company. Additionally, Jazz had also agreed to pay the Company up to $100.0 million in development funding over seven years to support the three ADC programs. In October 2019 and December 2020, Jazz exercised certain opt-out rights under the agreement, thereby relinquishing its development and commercialization options and restoring all rights to the ADC programs to the Company. The non-refundable, upfront arrangement consideration of $75.0 million was allocated to the three license options. In conjunction with the opt-outs, the Company recognized $60.5 million of the remaining deferred upfront fee as license and milestone fee revenue in the year ended December 31, 2020. Due to the involvement the Company and Jazz both had in the development and commercialization of the products, as well as both parties being part of the cost share agreement and exposed to significant risks and rewards dependent on the commercial success of the products, the arrangement was determined to be a collaborative arrangement within the scope of ASC 808. Accordingly, the Company separated the research and development activities and the related cost sharing arrangement with Jazz. Payments for such activities were recorded as research and development expense and reimbursements received from Jazz were recognized as an offset to research and development expense in the accompanying statement of operations during the development period. Included in research and development expense for each of the years ended December 31, 2021 and 2020 are $6.7 million of credits related to reimbursements from Jazz. |
Product Revenue Reserves and Al
Product Revenue Reserves and Allowances | 12 Months Ended |
Dec. 31, 2022 | |
Product Revenue Reserves and Allowances | |
Product Revenue Reserves and Allowances | D. Product Revenue Reserves and Allowances In November 2022, the FDA granted accelerated approval for ELAHERE for the treatment of adult patients with FRα positive, platinum-resistant epithelial ovarian, fallopian tube, or primary peritoneal cancer, who have received one to three prior systemic treatment regimens. The Company recorded net product revenue of $2.6 million from U.S. sales of ELAHERE through December 31, 2022. The following table summarizes activity in each of the product revenue allowance and reserve categories for the years ended December 31, 2022 and 2021 (in thousands): December 31, December 31, 2022 2021 Beginning balance at January 1 $ — $ — Provision related to sales in the current period 313 — Credits and payments made — — Ending balance at December 31 $ 313 $ — |
Inventory
Inventory | 12 Months Ended |
Dec. 31, 2022 | |
Inventory | |
Inventory | E. Inventory Capitalized inventory consists of the following at December 31, 2022 and 2022 (in thousands): December 31, December 31, 2022 2021 Raw materials $ 15,952 $ — Work in process — — Finished goods 244 — Total Inventory $ 16,196 $ — |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2022 | |
Property and Equipment | |
Property and Equipment | F. Property and Equipment Property and equipment consisted of the following at December 31, 2022 and 2021 (in thousands): December 31, December 31, 2022 2021 Leasehold improvements $ 22,867 $ 22,051 Machinery and equipment 3,063 2,955 Computer hardware and software 6,248 5,846 Furniture and fixtures 3,383 3,265 Assets under construction 180 233 $ 35,741 $ 34,350 Less accumulated depreciation (31,364) (29,687) Property and equipment, net $ 4,377 $ 4,663 Included in the table above are amounts capitalized for equipment under capital leases at December 31, 2022 and 2021 totaling $2.2 million and $2.1 million, net of accumulated amortization of $1.8 million and $1.6 million, respectively. Depreciation expense was $1.8 million, $2.0 million, and $2.1 million for the years ended December 31, 2022, 2021 and 2020, respectively. As a result of the restructuring in 2019, during the year ended December 31, 2020, the Company liquidated laboratory equipment and certain other fixed assets with an aggregate cost basis of $7.5 million and accumulated depreciation of $6.8 million for $1.4 million in payments to the Company. |
Convertible 4.5 Senior Notes
Convertible 4.5 Senior Notes | 12 Months Ended |
Dec. 31, 2022 | |
Convertible 4.5% Senior Notes. | |
Convertible 4.5% Senior Notes | G. Convertible 4.5% Senior Notes |
Liability Related to Sale of Fu
Liability Related to Sale of Future Royalties | 12 Months Ended |
Dec. 31, 2022 | |
Liability Related to Sale of Future Royalties | |
Liability Related to Sale of Future Royalties | H. Liability Related to Sale of Future Royalties In 2015, Immunity Royalty Holdings, L.P. (IRH) purchased the right to receive 100% of the royalty payments on commercial sales of KADCYLA arising under the Company’s development and commercialization license with Genentech, until IRH had received aggregate royalties equal to $235 million or $260 million, depending on when the aggregate royalties received by IRH reached a specified milestone. Once the applicable threshold was met, the Company would thereafter have received 85% and IRH would have received 15% of the KADCYLA royalties for the remaining royalty term. At consummation of the transaction, the Company received cash proceeds of $200 million. As part of this sale, the Company incurred $5.9 million of transaction costs, which are presented net of the liability in the accompanying consolidated balance sheet and are being amortized to interest expense over the estimated life of the royalty purchase agreement. Although the Company sold its rights to receive royalties from the sales of KADCYLA, as a result of its ongoing involvement in the cash flows related to these royalties, the Company continues to account for these royalties as revenue and recorded the $200 million in proceeds from this transaction as a liability related to sale of future royalties (Royalty Obligation) that is being amortized using the interest method over the estimated life of the royalty purchase agreement. In January 2019, the Company sold its residual rights to receive royalty payments on commercial sales of KADCYLA to OMERS, the defined benefit pension plan for municipal employees in the Province of Ontario, Canada, for a net payment of $65.2 million (amount is net of $1.5 million in broker fees). Simultaneously, OMERS purchased IRH’s right to the royalties the Company previously sold as described above, therefore obtaining the rights to 100% of the royalties received from that date on. Because the Company will not be involved with the cash flows related to the residual royalties, the $65.2 million of net proceeds received from the sale of its residual rights to receive royalty payments was recorded as deferred revenue and is being amortized as the royalty revenue related to the residual rights is earned using the units of revenue approach. During the second quarter of 2021, the aggregate royalty threshold was met and, in accordance with the Company’s revenue recognition policy, $16.4 million and $7.7 million of revenue related to the residual rights was recorded and is included in non-cash royalty revenue for the years ended December 31, 2022 and 2021, respectively. Additionally, the purchase of IRH’s interest by OMERS did not result in an extinguishment or modification of the original instrument and, accordingly, the Company will continue to account for the remaining obligation as a liability as outlined above. The following table shows the activity within the liability account during the year ended December 31, 2022 and the period from inception (in thousands): Period from Year Ended inception to December 31, 2022 December 31, 2022 Liability related to sale of future royalties, net — beginning balance $ 41,044 $ — Proceeds from sale of future royalties, net — 194,135 KADCYLA royalty payments received and paid (13,101) (276,958) Non-cash interest expense recognized 4,165 114,931 Liability related to sale of future royalties, net — ending balance $ 32,108 $ 32,108 The Company receives royalty reports and royalty payments related to sales of KADCYLA from Roche one than its initial estimates, or the timing of such payments is materially different than its original estimates, the Company will prospectively adjust the amortization of the Royalty Obligation. There are a number of factors that could materially affect the amount and timing of royalty payments from Genentech, most of which are not within the Company’s control. Such factors include, but are not limited to, changing standards of care, the introduction of competing products, manufacturing or other delays, biosimilar competition, patent protection, adverse events that result in governmental health authority imposed restrictions on the use of the drug products, significant changes in foreign exchange rates as the royalties are paid in U.S. dollars (USD) while significant portions of the underlying sales of KADCYLA are made in currencies other than USD, and other events or circumstances that could result in reduced royalty payments from KADCYLA, all of which would result in a reduction of non-cash royalty revenues and non-cash interest expense over the life of the Royalty Obligation. Conversely, if sales of KADCYLA are more than expected, the non-cash royalty revenues and the non-cash interest expense recorded by the Company would be greater over the term of the Royalty Obligation. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Taxes | |
Income Taxes | I. Income Taxes For the years ended December 31, 2022, 2021 and 2020, the loss before provision for income taxes consist of the following (in thousands): Years Ended December 31, 2022 2021 2020 Domestic $ 18,417 $ (139,303) $ (44,372) Foreign (240,128) — — Total $ (221,711) $ (139,303) $ (44,372) For the year ended December 31, 2022, the Company’s total tax expense was all federal current expense. The difference between the Company’s expected tax benefit, as computed by applying the applicable U.S. federal corporate tax rate to loss before the benefit for income taxes, and actual tax is reconciled in the following table (in thousands): Years Ended December 31, 2022 2021 2020 Loss before income tax expense $ (221,711) $ (139,303) $ (44,372) Expected tax benefit at 21% $ (46,559) $ (29,254) $ (9,318) Permanent differences 454 606 157 Intra-entity transfer of intangible assets 90,720 — — Incentive stock options 769 420 201 State tax provision (benefit) net of federal benefit 29,304 (7,376) (2,250) Change in valuation allowance, net (75,683) 46,987 15,175 Federal research credit (2,030) (575) (228) Federal orphan drug credit (9,286) (7,429) (6,218) Expired loss and credit carryforwards — 345 419 Withholding tax credit (878) (4,789) — Stock option expirations — 1,065 2,062 Foreign rate differential 14,407 — — Income tax expense $ 1,218 $ — $ — At December 31, 2022, the Company had NOL carryforwards of $443.3 million available to reduce federal taxable income, if any, that can be carried forward indefinitely. The Company has $251.1 million of NOL carryforwards available to reduce state taxable income, if any, that expire in 2036 through 2042. The Company also has federal and state credit carryforwards of $85.6 million and $11.1 million, respectively, available to offset federal and state income taxes, which expire beginning in 2027 and foreign tax credits of $6.5 million that begin to expire in 2030. Due to the degree of uncertainty related to the ultimate use of the loss carryforwards and tax credits, the Company has established a valuation allowance to fully reserve these tax benefits. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities as of December 31, 2022 and 2021 are as follows (in thousands): December 31, 2022 2021 Deferred tax assets: Net operating loss carryforwards $ 115,047 $ 264,773 Research and development tax credit carryforwards 103,155 92,832 Property and other intangible assets 1,452 1,150 Deferred revenue 14,561 25,153 Stock-based compensation 18,783 12,195 Operating lease liability 4,421 5,170 Other liabilities 3,144 1,737 Royalty sale 8,393 10,247 Sec 174 R&E capitalization 68,150 — Total deferred tax assets $ 337,106 $ 413,257 Deferred tax liabilities: Operating lease right of use asset (2,967) (3,386) Royalty sale transaction costs (107) (158) Total deferred tax liabilities $ (3,074) $ (3,544) Valuation allowance (334,032) (409,713) Net deferred tax assets/(liabilities) $ — $ — The Company has evaluated the positive and negative evidence bearing upon the realizability of its deferred tax assets. The Company has determined that it is not more-likely-than-not that the tax benefits related to the federal and state deferred tax assets will be realized for financial reporting purposes. Accordingly, the deferred tax assets have been fully reserved at December 31, 2022 and 2021. The valuation allowance decreased by $75.7 million during the year ended December 31, 2022. Utilization of the NOL and credit carryforwards may be subject to a substantial annual limitation due to ownership change limitations that have occurred previously or that could occur in the future as provided by Sections 382 and 383 of the Internal Revenue Code of 1986, as well as similar state and foreign provisions. These ownership changes may limit the amount of NOL and credit carry forwards that can be utilized annually to offset future taxable income and tax, respectively. In general, an ownership change, as defined by Section 382, results from transactions increasing the ownership of certain shareholders or public groups in the stock of a corporation by more than 50 percentage points over a three-year period. Since the Company’s formation, it has raised capital through the issuance of capital stock on several occasions (both pre and post initial public offering) which, combined with the purchasing shareholders’ subsequent disposition of those shares, may have resulted in a change of control, as defined by Section 382, or could result in a change of control in the future upon subsequent disposition. The Company completed a study to assess whether a change of control has occurred or whether there have been multiple changes of control since its formation and determined no ownership change occurred under Section 382 as of December 31, 2022. The Company has not completed a detailed Research and Development Credit Study (including the Orphan Drug Credit); accordingly, a portion of the tax credit carryforward may not be available to offset future income. The Company accounts for uncertain tax positions under the recognition and measurement criteria of ASC 740-10. For those tax positions for which it is more likely than not that a tax benefit will be sustained, the Company records the largest amount of tax benefit with a greater than 50% likelihood of being realized upon settlement with a taxing authority that has full knowledge of all relevant information. If the Company does not believe that it is not more likely than not that a tax benefit will be sustained, no tax benefit is recognized. As of December 31, 2022 and 2021, no uncertain tax positions have been recorded. Interest and penalties related to the settlement of uncertain tax positions, if any, will be reflected in income tax expense. The Company did not recognize any interest and penalties associated with unrecognized tax benefits in the accompanying consolidated financial statements. The Company does not expect any material changes to the unrecognized benefits within 12 months of the reporting date. Due to existence of the valuation allowance, future changes in the Company’s unrecognized tax benefits will not impact its effective tax rate. The statute of limitations for assessment by the Internal Revenue Service, or IRS, and state tax authorities is open for tax years ending after December 31, 2018, although carryforward attributes that were generated prior to 2018 may still be adjusted upon examination by the IRS or state tax authorities if they either have been or will be used in a future period. |
Capital Stock
Capital Stock | 12 Months Ended |
Dec. 31, 2022 | |
Capital Stock | |
Capital Stock | J. Capital Stock Common Stock Reserved At December 31, 2022, the Company had reserved 56.0 million shares of authorized common stock for the future issuance of shares under the 2018, ESPP, and Inducement Plans. See “Stock-Based Compensation” in Note B for a description of the 2018, ESPP, and Inducement Plans. Additionally, the Company has reserved 32.8 million shares of authorized common stock for future issuance pursuant to pre-funded warrant agreements, the details of which are discussed below. Pre-Funded Warrants In August 2021, the Company entered into a Securities Purchase Agreement (SPA) with RA Capital Healthcare Fund, L.P. (RA Capital), pursuant to which the Company agreed to sell to RA Capital a pre-funded warrant to purchase up to 5,434,782 shares of common stock for $5.51 per share of common stock underlying the pre-funded warrant. The per share exercise price of the pre-funded warrant is $0.01. The private placement resulted in aggregate gross proceeds of $29.9 million, before $0.2 million of transaction costs. In connection with a public offering in December 2021, the Company issued pre-funded warrants to purchase 16,000,000 and 11,363,636 shares of common stock to RA Capital and Redmile Group, LLC, respectively, for $6.59 per share of common stock underlying the pre-funded warrants, which, together with the per share exercise price of $0.01, is equal to $6.60, the public offering price of the shares of common stock in the offering. RA Capital and Redmile Group, LLC are each considered related parties pursuant to ASC 850, Related Party Disclosures The pre-funded warrants’ fundamental transaction provision does not provide the warrant holders with the option to settle any unexercised warrants for cash in the event of any fundamental transactions; rather, in all fundamental transaction scenarios, the warrant holder will only be entitled to receive from the Company or any successor entity the same type or form of consideration (and in the same proportion) that is being offered and paid to the shareholders of the Company in connection with the fundamental transaction, whether that consideration be in the form of cash, stock or any combination thereof. The pre-funded warrants also include a separate provision whereby the exercisability of the warrants may be limited if, upon exercise, the warrant holder or any of its affiliates would beneficially own more than 9.99% of the Company’s common stock. This threshold is subject to the holder’s rights under the pre-funded warrants to increase or decrease such percentage to any other percentage not in excess of 19.99% upon at least 61 days’ prior notice from the holder to the Company. The Company has assessed the pre-funded warrants for appropriate equity or liability classification pursuant to the Company’s accounting policy described in Note B, “Summary of Significant Accounting Policies.” During this assessment, the Company determined the pre-funded warrants are freestanding instruments that do not meet the definition of a liability pursuant to ASC 480 and do not meet the definition of a derivative pursuant to ASC 815. The pre-funded warrants are indexed to the Company’s common stock and meet all other conditions for equity classification under ASC 480 and ASC 815. Based on the results of this assessment, the Company concluded that the pre-funded warrants are freestanding equity-linked financial instruments that meet the criteria for equity classification under ASC 480 and ASC 815. Accordingly, the pre-funded warrants are classified as equity and accounted for as a component of additional paid-in capital at the time of issuance. The Company also determined that the pre-funded warrants should be included in the determination of basic and diluted earnings per share in accordance with ASC 260, Earnings per Share Stock Options As of December 31, 2022, the 2018 Plan and the Inducement Plan were the only employee share-based compensation plans of the Company under which grants can be made. During the year ended December 31, 2022, holders of options issued under the option plans exercised their rights to acquire an aggregate of 313,000 shares of common stock at prices ranging from $2.31 to $5.25 per share. The total proceeds to the Company from these option exercises were $1.2 million. Additionally, during 2022 and pursuant to the Company’s ESPP, approximately 178,000 shares of common stock were issued to participating employees generating $0.7 million of proceeds to the Company. 2004 Non-Employee Director Compensation and Deferred Share Unit Plan Under the 2004 Non-Employee Director Compensation and Deferred Share Unit Plan, or the 2004 Director Plan, as amended, between 2004 and 2009 non-employee directors were paid their annual retainers in the form of deferred stock units, based on the fair market value of the Company’s common stock on the last date of the Company’s fiscal year prior to the year for which services were rendered, and in cash, with the option, at their discretion, to have all or a portion of the cash portion paid in additional deferred stock units. All deferred stock units awarded under the 2004 Director Plan have vested and are redeemed on the date a director ceases to be a member of the Board, at which time such director’s deferred stock units will be settled in shares of common stock of the Company issued under the 2006 Plan at a rate of one share for each vested unit. Compensation Policy for Non-Employee Directors In September 2009, the Board adopted a new Compensation Policy for Non-Employee Directors, which superseded the 2004 Plan and made certain changes to the compensation of its non-employee directors. The Compensation Policy for Non-Employee Directors, as amended as of December 2022, consists of three elements: cash compensation; deferred stock units; and stock options. Cash Compensation Each non-employee director receives annual meeting fees which are paid in quarterly installments in, at each director’s election, either cash or deferred stock units. Deferred Stock Units Pursuant to the Compensation Policy for Non-Employee Directors, as amended, non-employee directors receive deferred stock units upon initial election to the Board and annually thereafter. Vested deferred stock units are redeemed on the date a director ceases to be a member of the Board, at which time such director’s deferred stock units will generally be settled in shares of the Company’s common stock issued under our 2018 Plan (or its predecessor plans, depending on the grant date of the deferred stock units) at a rate of one share for each vested deferred stock unit then held. Any deferred stock units that remain unvested at that time will be forfeited. Pursuant to the Compensation Policy for Non-Employee Directors, as amended, the Company recorded: ● $0.7 million in compensation expense during the year ended December 31, 2022 related to the grant of 148,000 deferred share units and 100,000 deferred share units previously granted; ● $0.7 million in compensation expense during the year ended December 31, 2021 related to the grant of 166,000 deferred share units and 52,000 deferred share units previously granted; and ● $0.3 million in compensation expense during the year ended December 31, 2020 related to the grant of 127,000 deferred share units and 15,000 deferred share units previously granted. Stock Options Pursuant to the Compensation Policy for Non-Employee Directors, as amended, non-employee directors also receive stock option awards upon initial election to the Board and annually thereafter. The directors received a total of 321,622, 352,000, and 300,000 options in the years ended December 31, 2022, 2021, and 2020, and the related stock compensation expense is included in the amounts discussed in the “Stock-Based Compensation” section of footnote B above. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases | |
Leases | K. Leases Leases The Company currently has one real estate lease with CRP/King 830 Winter L.L.C. for the rental of approximately 120,000 square feet of laboratory and office space at 830 Winter Street, Waltham, Massachusetts through March 2026. The Company uses this space for its corporate headquarters and other operations. The Company may extend the lease for two additional terms of five years and is required to pay certain operating expenses for the leased premises subject to escalation charges for certain expense increases over a base amount. The Company also has a lease agreement through March 2027 for the rental of copier equipment. The maturities of operating lease liabilities discussed above are as follows (in thousands): 2023 $ 5,503 2024 5,522 2025 5,543 2026 1,429 2027 13 Total lease payments 18,010 Less imputed interest (2,766) Total lease liabilities $ 15,244 In addition to the amounts in the table above, the Company is also responsible for variable operating costs and real estate taxes approximating $3.8 million per year through March 2026. Sublease Income In 2020, the Company executed four agreements to sublease a total of approximately 65,000 square feet of the Company’s leased space at 830 Winter Street, Waltham, Massachusetts through March 2026. During the years ended December 31, 2022 and 2021, the Company recorded $1.1 million and $4.9 million of sublease income, respectively, inclusive of the sublessees’ proportionate share of operating expenses and real estate taxes for the period. The decrease in the current year period is driven by amortization of the lease incentive discussed further below. In June 2022, in order to reclaim laboratory and office space, the Company modified one of its sublease agreements to terminate the sublease early. Pursuant to the amended sublease agreement, the Company is required to pay the sublessee $4.0 million as a lease incentive, of which $1.8 million was paid in June 2022 and the remainder was paid at the end of the sublease term in early January 2023. No other terms from the original sublease agreement were modified. In accordance with ASC 842, Leases One of the two remaining sublease agreements includes an early termination option after certain periods of time for an agreed-upon fee. Assuming no early termination option is exercised, the Company will receive $5.7 million in minimum rental payments over the remaining term of the subleases, which is not included in the operating lease liability table above. The sublessees are also responsible for their proportionate share of variable operating expenses and real estate taxes. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies | |
Commitments and Contingencies | L. Commitments and Contingencies Manufacturing Commitments As of December 31, 2022, the Company has noncancelable obligations under several agreements related to in-process and future manufacturing of antibody and cytotoxic agents required for supply of the Company’s product candidates totaling $17.9 million, which will be paid in 2023. Additionally, pursuant to commercial agreements for future production of antibody, the Company’s noncancelable commitments total $43.7 million at December 31, 2022. License Commitment In October 2021, as a result of a dispute regarding terms of a 2012 license agreement with a contract manufacturing vendor, the Company and vendor amended their agreement to replace certain annual fees and potential royalties payable by the Company on future sales of ELAHERE with capped development and sales-based milestone payments totaling $18.0 million, of which $6.0 million and $3.0 million was recorded as research and development expense during the years ended December 31, 2022 and 2021, respectively. Litigation The Company is not party to any material litigation. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions | |
Related Party Transactions | M. Related Party Transactions The Company’s chief executive officer has served as a director on the board of directors of Ergomed PLC since June 2021. During the year ended December 31, 2022, the Company executed agreements with Ergomed Clinical Research, Inc. and PrimeVigilance USA, Inc., subsidiaries of Ergomed PLC, for clinical trial and pharmacovigilance-related services. Ergomed Clinical Research, Inc. and PrimeVigilance USA, Inc. are each considered related parties pursuant to ASC 850, Related Party Disclosures The Company’s Executive Vice President of Research, Development, and Medical Affairs joined the Company on December 29, 2022. He has served as a director on the board of directors of Magenta Therapeutics since August 2022. In 2020, the Company and Magenta executed a Material Transfer and Evaluation Agreement, and subsequently executed an exclusive development and commercialization license to the Company’s IGN ADC technology to a specified target in November 2022. Pursuant to the agreements, the Company received an aggregate $6.0 million in license fees during the years ended December 31, 2022 and 2021. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2022 | |
Employee Benefit Plans | |
Employee Benefit Plans | N. Employee Benefit Plans The Company has a deferred compensation plan under Section 401(k) of the Internal Revenue Code (the 401(k) Plan). Under the 401(k) Plan, eligible employees are permitted to contribute, subject to certain limitations, up to 100% of their gross salary and the Company’s matching contribution is 50% of the first 6% of the eligible employees’ contributions. In the years ended December 31, 2022, 2021 and 2020, the Company’s contributions to the 401(k) Plan totaled $1.0 million, $0.5 million, and $0.4 million, respectively. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies | |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, ImmunoGen Switzerland GmbH, ImmunoGen U.S. Holding, Inc., ImmunoGen Securities Corp., ImmunoGen Europe Limited, ImmunoGen BioPharma (Ireland) Limited, and Hurricane, LLC. All intercompany transactions and balances have been eliminated. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States (U.S.) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Revenue Recognition | Revenue Recognition Product Revenue The Company generates product revenue from sales of ELAHERE its products Product revenue is recognized when the customer takes control of the product, typically upon delivery to the customer. Product revenue is recorded at the net sales price, or transaction price, which includes estimated reserves for variable consideration resulting from chargebacks, government rebates, trade discounts and allowances, product returns and other incentives that are offered within the contract with customers, healthcare providers, payors and other indirect customers relating to the sales of the Company’s product. Reserves are established based on the amounts earned or to be claimed on the related sales. Where appropriate, the Company utilizes the expected value method to determine the appropriate amount for estimates of variable consideration based on factors such as the Company’s current contractual and statutory requirements, specific known market events and trends, industry data and forecasted customer buying and payment patterns, the percentage of our products that are sold via these programs, and our product pricing. The amount of variable consideration that is included in the transaction price may be constrained and is included in net product revenues only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from the Company’s estimates. If actual results vary from the Company’s estimates, the Company adjusts these estimates, which would affect net product revenue and earnings in the period such variances become known. Chargebacks: expected value method based upon a range of possible outcomes and are established in the same period that the related revenue is recognized, resulting in a reduction of product revenue. Government rebates: Trade discounts and allowances: Product returns: Other deductions: The Company entered into a third-party logistics distribution agreement (the 3PL Agreement) to engage a logistics distribution agent (the 3PL Agent) to distribute the Company’s products to its customers. The 3PL Agent provides services to the Company that include support, electronic data interface and system access support. As a practical expedient, sales commissions, which represent costs to obtain a contract, are expensed when incurred because the amortization period would have been one year or less. Sales commissions are recorded in selling, general and administrative expense and costs of sales, respectively, in the statements of operations and comprehensive loss. Additionally, as a practical expedient, the Company has elected to License and Milestone Fee Revenue The Company enters into licensing and development agreements with collaborators for the development of ADCs. The terms of these agreements contain multiple promised goods and services which may include (i) licenses, or options to obtain licenses, to the Company’s ADC technology, (ii) rights to future technological improvements, (iii) technology transfer services and other activities to be performed on behalf of the collaborative partner, and (iv) delivery of cytotoxic agents and/or the manufacture of preclinical and clinical materials for the collaborative partner. Payments to the Company under these agreements may include upfront fees, option fees, exercise fees, payments for services, payments for preclinical or clinical materials, payments based upon the achievement of certain milestones, and royalties on product sales. The Company follows the provisions of ASC 606, Revenue from Contracts with Customers, Revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. In determining the appropriate amount of revenue to be recognized as it fulfills its obligations under the agreements, the Company performs the following five steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when or as the Company satisfies each performance obligation. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration to which it is entitled in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract and determines those that are performance obligations based on its assessment of whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when or as the performance obligation is satisfied. The Company exercises judgment in assessing those promised goods and services that are distinct and thus representative of performance obligations. To the extent the Company identifies multiple performance obligations in a contract, the Company must develop assumptions that require judgment to determine the estimated standalone selling price for each performance obligation in order to allocate the transaction price among the identified performance obligations. These judgments and assumptions are discussed in further detail below. At December 31, 2022, the Company had the following types of agreements with the parties identified below: ● Development and commercialization licenses, which provide the counterparty with the right to use the Company’s ADC technology and/or certain other intellectual property to develop and commercialize compounds to a specified antigen target: Bayer (one exclusive single-target license) CytomX (two exclusive single-target licenses) Debiopharm (one exclusive single-compound license) Eli Lilly and Company (multiple exclusive single-target licenses) Fusion Pharmaceuticals (one exclusive single-target license) Hangzhou Zhongmei Huadong Pharmaceutical Co., Ltd. (one territory-specific exclusive single-compound license) Magenta Therapeutics (one exclusive single-target license) Novartis (one exclusive single-target licenses) Oxford BioTherapeutics/Menarini (one exclusive single-target license sublicensed from Amgen) Roche, through its Genentech unit (five exclusive single-target licenses) Viridian (one exclusive single-target license) ● Collaboration and license agreement to co-develop and co-commercialize a specified anticancer compound on established terms: MacroGenics During the year ended December 31, 2022, pursuant to notice received, certain exclusive development and commercialization licenses granted to Novartis were terminated. There are no performance, cancellation, termination, or refund provisions in any of the arrangements that contain material financial consequences to the Company. Development and Commercialization Licenses The obligations under a development and commercialization license agreement generally include the license to the Company’s ADC technology with respect to a specified antigen target or compound and may also include obligations related to rights to future technological improvements and other activities to be performed on behalf of the collaborative partner. Generally, development and commercialization licenses contain non-refundable terms for payments and, depending on the terms of the agreement, provide that the Company will earn payments upon the achievement of certain milestones and royalty payments, generally until the later of the last applicable patent expiration or a fixed period of years after product launch. Royalty rates may vary over the royalty term depending on the Company’s intellectual property rights and/or the presence of comparable competing products. In certain instances, the Company may also provide cytotoxic agents and/or clinical materials or other services in addition to the development and commercialization licenses. For example, the Company may provide technology transfer services in connection with the out-licensing of product candidates initially developed by the Company and may also provide technical assistance and share any technology improvements with its collaborators during the term of the collaboration agreements. The Company does not directly control when or whether any collaborator will request certain services, achieve milestones, or become liable for royalty payments. In determining the performance obligations for these arrangements, management evaluates whether the license is distinct and has significant standalone functionality either alone or with other readily available resources based on the consideration of the relevant facts and circumstances for each arrangement. Factors considered in this determination include the research capabilities of the partner and the availability of ADC technology research expertise and ADC manufacturing capabilities in the general marketplace and whether technological improvements are required for the continued functionality of the license. If the license to the Company’s intellectual property is determined to be distinct, the Company recognizes revenues from non-refundable, upfront fees allocated to the license when the license is transferred to the customer and the customer is able to use and benefit from the license. If the license is not distinct, the license is combined with other goods or services into a single performance obligation and revenue is recognized over time. The Company estimates the standalone selling prices of the license and all other performance obligations based on market conditions, similar arrangements entered into by third parties, and entity-specific factors such as the terms of the Company’s previous collaborative agreements, recent preclinical and clinical testing results of therapeutic products that use the Company’s ADC technology, the Company’s pricing practices and pricing objectives, the likelihood that technological improvements will be made, and, if made, will be used by the Company’s collaborators, and the nature of the other services to be performed on behalf of its collaborators and market rates for similar services. The Company recognizes revenue related to technology transfer activities and other services as the services are performed. The Company is generally compensated for these activities at negotiated rates that are consistent with what other third parties would charge. The Company records amounts recognized for services performed as a component of research and development support revenue. The Company may also provide cytotoxic agents and/or preclinical and clinical materials (drug substance/drug product) to its collaborators at negotiated prices generally consistent with what other third parties would charge. The Company recognizes revenue on cytotoxic agents and/or preclinical and clinical materials when control transfers to the collaborator as a component of research and development support revenue. The Company recognizes revenue related to the rights to future technological improvements over the estimated term of the applicable license. The Company’s development and commercialization license agreements have milestone payments which for reporting purposes are aggregated into two categories: (i) development and regulatory milestones, and (ii) sales milestones. Development milestones are typically payable when a product candidate initiates or advances into different clinical trial phases. Regulatory milestones are typically payable upon submission for marketing approval with the FDA or other countries’ regulatory authorities or on receipt of actual marketing approvals for the compound or for additional indications. Sales milestones are typically payable when annual sales reach certain levels. At the inception of each arrangement, the Company evaluates any development and regulatory milestone payments to determine whether the milestone is considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price to be allocated; otherwise, such amounts are considered constrained and excluded from the transaction price. As part of its evaluation of the constraint, the Company considers numerous factors, including whether the achievement of the milestone is outside the control of the Company and contingent upon the future success of clinical trials, the collaborator’s efforts, or the receipt of regulatory approval. At the end of each subsequent reporting period, the Company re-evaluates the probability of achievement of such development or regulatory milestones and any related constraint, and if necessary, adjusts the estimate of the transaction price. In addition, the Company evaluates whether the achievement of each milestone specifically relates to the Company’s efforts to satisfy a performance obligation or transfer a distinct good or service within a performance obligation. If the achievement of a milestone is considered a direct result of the Company’s efforts to satisfy a performance obligation or transfer a distinct good or service and the receipt of the payment is based upon the achievement of the milestone, the associated milestone value is allocated to that distinct good or service. If the milestone payment is not specifically related to the Company’s effort to satisfy a performance obligation or transfer a distinct good or service, the amount is allocated to all performance obligations using the relative standalone selling price method. Amounts allocated to a satisfied performance obligation are recognized as revenue, or as a reduction of revenue, in the period in which the transaction price changes. For development and commercialization license agreements that include sales-based royalties, including milestone payments based on the level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied) in accordance with the royalty recognition constraint. Under the Company’s development and commercialization license agreements, the Company receives royalty payments based upon its licensees’ net sales of covered products. Generally, under the development and commercialization agreements, the Company receives royalty reports and payments from its licensees approximately one quarter in arrears. The Company estimates the amount of royalty revenue to be recognized based on historical and forecasted sales and/or sales information from its licensees if available. Collaboration and Option Agreements/Right-to-Test Agreements The Company’s right-to-test agreements provide collaborators the right to test the Company’s ADC technology for a defined period of time through a research, or right-to-test, license. Under both right-to-test agreements and collaboration and option agreements, collaborators may (a) “take” options, for a defined period of time, to specified targets and (b) upon exercise of those options, secure or “take” licenses to develop and commercialize products for the specified targets on established terms. Under these agreements, fees may be due to the Company (i) at the inception of the arrangement (referred to as “upfront” fees or payments), (ii) upon the opt-in to acquire a development and commercialization license(s) (referred to as exercise fees or payments earned, if any, when the development and commercialization license is “taken”), (iii) after providing services at the collaborator’s request at negotiated prices, which are generally consistent with what other third parties would charge, or (iv) upon some combination of all of these fees. The accounting for collaboration and option agreements and right-to-test agreements is dependent on the nature of the options granted to the collaborative partner. Options are considered distinct performance obligations if they provide a collaborator with a material right. Factors that are considered in evaluating whether options convey a material right include the overall objective of the arrangement, the benefit the collaborator might obtain from the agreement without exercising the options, the cost to exercise the options relative to the fair value of the licenses, and the additional financial commitments or economic penalties imposed on the collaborator as a result of exercising the options. If the Company concludes that an option provides the customer a material right, and therefore is a separate performance obligation, the Company then determines the estimated standalone selling price of the option using the following inputs: (a) estimated fair value of the license underlying each option, (b) the amount the partner would pay to exercise the option to obtain the license, and (c) probability of exercise. The Company does not control when or if any collaborator will exercise its options for development and commercialization licenses. As a result, the Company cannot predict when or if it will recognize revenues in connection with any of the foregoing. Upfront payments on development and commercialization licenses may be recognized upon delivery of the license if facts and circumstances dictate that the license is distinct from the other promised goods and services. In determining whether a collaboration and option agreement is within the scope of ASC 808, Collaborative Arrangements Transaction Price Allocated to Remaining Performance Obligations Deferred revenue under ASC 606 represents the portion of the transaction price received under various contracts for which work has not been performed (or has been partially performed) and includes unexercised contract options that are considered material rights. As of December 31, 2022, the aggregate amount of the transaction price allocated to remaining performance obligations comprising deferred revenue was $50.2 million. The Company expects to recognize revenue on approximately 28%, 70%, and 2% of the remaining performance obligations over the next 12 months, 13 61 Contract Balances from Contracts with Customers The following tables present changes in the Company’s contract assets and contract liabilities during the years ended December 31, 2022 and 2021 (in thousands): Balance at Balance at December 31, 2021 Additions Deductions Impact of Netting December 31, 2022 Contract asset $ 3,000 $ — $ (3,000) $ — $ — Contract liabilities (deferred revenue) $ 92,068 $ 7,605 $ (49,462) $ — $ 50,211 Balance at Balance at December 31, 2020 Additions Deductions Impact of Netting December 31, 2021 Contract asset $ — $ 5,500 $ (2,500) $ — $ 3,000 Contract liabilities (deferred revenue) $ 110,109 $ 4,753 $ (22,794) $ — $ 92,068 During the years ended December 31, 2022, 2021, and 2020 the Company recognized the following revenues as a result of changes in contract asset and contract liability balances in the respective periods (in thousands): Year Ended December 31, 2022 2021 2020 Revenue recognized in the period from: Amounts included in contract liabilities at the beginning of the period $ 49,462 $ 22,765 $ 61,872 Performance obligations satisfied in previous periods $ 13,661 $ 5,500 $ — The timing of revenue recognition, billings, and cash collections results in billed receivables, unbilled receivables, contract assets, and contract liabilities on the consolidated balance sheets. When consideration is received, or such consideration is unconditionally due, from a customer prior to transferring goods or services to the customer under the terms of a contract, a contract liability is recorded (under the caption deferred revenue). Contract liabilities are recognized as revenue after control of the products or services is transferred to the customer and all revenue recognition criteria have been met. The Company recorded the following during the year ended December 31, 2022: (i) pursuant to the Company’s license agreement with Hangzhou Zhongmei Huadong Pharmaceutical Co., Ltd. (Huadong), upon delivery of clinical materials in 2022, the Company recognized as license and milestone fee revenue the remaining $28.5 million of the deferred revenue balance as of December 31, 2021 related to the $45.0 million of upfront and development milestone payments previously received; (ii) pursuant to a license agreement executed with Eli Lilly and Company (Lilly) during 2022, the Company received upfront payments of $26.0 million, of which $18.4 million was recognized as license and milestone fee revenue and the remainder deferred, further details of which can be found in Note C, “Agreements”; (iii) pursuant to a license agreement executed with Magenta Therapeutics in 2022, the Company recorded $6.0 million as license and milestone fee revenue, of which $1.6 million had been previously received and recorded as deferred revenue as of December 31, 2021; (iv) $16.4 million of previously deferred non-cash royalty revenue related to the sale of rights to KADCYLA Pursuant to the Company’s license agreement with Huadong H, “Liability Related to Sale of Future Royalties.” Lastly, pursuant to a research agreement with Magenta, the Company received a During 2020, the Company recognized $60.5 million of previously deferred license revenue upon Jazz’s opt-out of its right to the last remaining license under the agreement and $3.2 million of upfront fees previously received from other partners, of which $1.4 million was included in contract liabilities at the beginning of 2020. As noted above, a $40.0 million upfront payment received in 2020 pursuant to a license agreement executed with Huadong was recorded as deferred revenue and none of this amount was recognized as revenue during 2020. Additionally, a contract asset of $3.6 million, net of $4.4 million in related contract liabilities, was recorded for two probable milestones in 2019 pursuant to license agreements with CytomX and Novartis, which were subsequently achieved and paid during 2020. |
Financial Instruments and Concentration of Credit Risk | Financial Instruments and Concentration of Credit Risk Cash and cash equivalents are primarily maintained with three financial institutions in the U.S. Deposits with banks may exceed the amount of insurance provided on such deposits. Generally, these deposits may be redeemed upon demand and, therefore, bear minimal risk. The Company’s cash equivalents consist of money market funds with underlying investments primarily being U.S. Government-issued securities and high quality, short-term commercial paper. Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash, cash equivalents, and marketable securities. The Company held no marketable securities as of December 31, 2022 and 2021. The Company’s investment policy, approved by the Board of Directors, limits the amount it may invest in any one type of investment, thereby reducing credit risk concentrations. |
Cash and Cash Equivalents | Cash and Cash Equivalents All highly liquid financial instruments with maturities of three months or less when purchased are considered cash equivalents. As of December 31, 2022 and 2021, the Company held $275.1 million and $478.8 million, respectively, in cash and money market funds consisting principally of U.S. Government-issued securities and high quality, short-term commercial paper which were classified as cash and cash equivalents. |
Non-cash Investing Activities | Non-cash Investing Activities The Company had $0.3 million and $0.2 million of accrued capital expenditures as of December 31, 2022 and 2021, respectively, which have been treated as a non-cash investing activity and accordingly, are not reflected in the consolidated statement of cash flows. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments ASC 820, Fair Value Measurement ● Level 1—Quoted prices in active markets for identical assets or liabilities. ● Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. ● Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. As of December 31, 2022 and 2021, the Company held certain assets that are required to be measured at fair value on a recurring basis. The fair value of the Company’s cash equivalents is based on quoted prices from active markets (Level 1 inputs). The carrying amounts reflected in the consolidated balance sheets for accounts receivable, unbilled receivable, contract assets, non-cash royalty receivable, prepaid and other current assets, accounts payable, accrued compensation, and other accrued liabilities approximate fair value due to their short-term nature. |
Accounts Receivable | Accounts Receivable Accounts receivable arise from product sales and amounts due from the Company’s collaboration partners. The amount from product sales represents amounts due from specialty distributors and specialty pharmacy providers in the U.S. The Company monitors economic conditions and the financial performance and credit worthiness of its counterparties to identify facts or circumstances that may indicate that its receivables are at risk of collection. The Company provides reserves against accounts receivable for estimated losses that may result from a customer’s inability to pay based on the composition of its accounts receivable, considering past events, current economic conditions, and reasonable and supportable forecasts about the future economic conditions. The contractual life of our accounts receivable is generally short-term. Amounts determined to be uncollectible are charged or written-off against the reserve. For the years ended December 31, 2022 and 2021, the Company did not record any expected credit losses related to outstanding accounts receivable. |
Unbilled Receivable | Unbilled Receivable Unbilled receivable primarily represents research funding earned based on actual resources utilized and external expenses incurred under certain of the Company’s collaborator agreements. |
Inventory | Inventory Inventories are stated at the lower of cost or estimated net realizable value with cost based on the first-in first-out method. Inventory that can be used in either the production of clinical or commercial products is expensed as research and development costs when identified for use in clinical trials. The Company classifies its inventory costs as long-term when it expects to utilize the inventory beyond its normal operating cycle based on forecasted levels of sales. Prior to the regulatory approval of its drug candidates, the Company incurs expenses for the manufacture of drug product to support clinical development that could potentially be available to support the commercial launch of those drugs. Until the date at which regulatory approval has been received or is otherwise considered probable, the Company records all such costs as research and development expenses. Inventory used in clinical trials is also expensed as research and development expense, when selected for such use. The Company performs an assessment of the recoverability of capitalized inventories during each reporting period and writes down any excess and obsolete inventory to its net realizable value in the period in which the impairment is first identified. Such impairment charges, should they occur, are recorded as a component of cost of sales in the consolidated statements of operations and comprehensive loss. The determination of whether inventory costs will be realizable requires the use of estimates by management. If actual market conditions are less favorable than projected by management, additional write-downs of inventory may be required. |
Clinical Trial Accruals | Clinical Trial Accruals Clinical trial expenses are a significant component of research and development expenses, and the Company outsources a significant portion of these activities to third parties. Third-party clinical trial expenses include investigator fees, site costs (patient cost), clinical research organization costs, and costs for central laboratory testing and data management. The accrual for site and patient costs includes inputs such as estimates of patient enrollment, patient cycles incurred, clinical site activations, and other pass-through costs. These inputs are required to be estimated due to a lag in receiving the actual clinical information from third parties. . Non-refundable advance clinical payments for goods or services that will be used or rendered for future R&D activities are recorded as a prepaid asset and recognized as expense as the related goods are delivered or the related services are performed. |
Leases | Leases The Company determines if an arrangement is a lease at inception. Operating leases include right-of-use (ROU) assets and operating lease liabilities (current and non-current), which are recorded in the Company’s consolidated balance sheets. Single payment capital leases for equipment that are considered finance leases are included in property and equipment in the Company’s consolidated balance sheets. As the single payment obligations have all been made, there is no related liability recorded. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The Company uses the implicit rate when readily determinable. As a number of the Company’s leases do not provide an implicit rate, the Company uses an incremental borrowing rate applicable to the Company based on the information available at the commencement date in determining the present value of lease payments. As the Company has no existing or proposed collateralized borrowing arrangements, to determine a reasonable incremental borrowing rate, the Company considers collateral assumptions, the lease term, the Company’s current credit risk profile, and rates for existing borrowing arrangements for comparable peer companies. The Company accounts for the lease and fixed non-lease components as a single lease component. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for operating lease payments is recognized on a straight-line basis over the lease term. |
Other Accrued Liabilities | Other Accrued Liabilities Other accrued liabilities consisted of the following at December 31, 2022 and 2021 (in thousands): December 31, December 31, 2022 2021 Accrued contract payments $ 15,971 $ 5,558 Accrued clinical trial costs 15,716 15,556 Accrued professional services 2,020 839 Accrued employee benefits 340 40 Accrued public reporting charges 265 309 Accrued tax provision 1,218 — Other current accrued liabilities 3,253 775 Total $ 38,783 $ 23,077 |
Research and Development Expenses | The Company’s research and development expenses are charged to expense as incurred and relate to (i) research to evaluate new targets and to develop and evaluate new antibodies, linkers, and cytotoxic agents, (ii) preclinical testing of its own and, in certain instances, its collaborators’ product candidates, and the cost of its own clinical trials, (iii) development related to clinical and commercial manufacturing processes, (iv) regulatory activities, (v) medical affairs activities, and (vi) external manufacturing operations. Payments made by the Company in advance for research and development services not yet provided and/or materials not yet delivered and accepted are recorded as prepaid expenses and are included in the accompanying consolidated balance sheets as prepaid and other current assets. |
Income Taxes | Income Taxes The Company uses the liability method to account for income taxes. Deferred tax assets and liabilities are determined based on differences between the financial reporting and income tax basis of assets and liabilities, as well as net operating loss carry forwards and tax credits and are measured using the enacted tax rates and laws that will be in effect when the differences reverse. A valuation allowance against net deferred tax assets is recorded if, based on the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost. The Company provides for depreciation based upon expected useful lives using the straight-line method over the following estimated useful lives: Machinery and equipment 5 years Computer hardware and software 3 years Furniture and fixtures 5 years Leasehold improvements Shorter of remaining lease term or 7 years Equipment under capital leases is amortized over the lives of the respective leases or the estimated useful lives of the assets, whichever is shorter, and included in depreciation expense. Maintenance and repairs are charged to expense as incurred. Upon retirement or sale, the cost of disposed assets and the related accumulated depreciation are removed from the accounts and any resulting gain or loss is included in the statement of operations. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company continually evaluates whether events or circumstances have occurred that indicate that the estimated remaining useful life of its long-lived assets may warrant revision or that the carrying value of these assets may be impaired if impairment indicators are present. The Company evaluates the realizability of its long-lived assets based on cash flow expectations for the related asset. Any write-downs to fair value are treated as permanent reductions in the carrying amount of the assets. Based on this evaluation, the Company believes that, as of each of the balance sheet dates presented, none of the Company’s long-lived assets were impaired. Common Stock Warrants The Company accounts for common stock warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance included in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity Derivatives and Hedging For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance and remeasured each balance sheet date thereafter. Changes in the estimated fair value of the liability-classified warrants are recognized as a non-cash gain or loss in the accompanying consolidated statements of operations and comprehensive loss. |
Common Stock Warrants | |
Computation of Net Loss per Common Share | Computation of Net Loss per Common Share Basic and diluted net loss per share is calculated based upon the weighted average number of shares of common stock outstanding during the period. Shares of the Company’s common stock underlying pre-funded warrants are included in the calculation of basic and diluted earnings per share. During periods of income, participating securities are allocated a proportional share of income determined by dividing total weighted average participating securities by the sum of the total weighted average common shares and participating securities (the “two-class method”). Shares of the Company’s restricted stock participate in any dividends that may be declared by the Company and are therefore considered to be participating securities. Participating securities have the effect of diluting both basic and diluted earnings per share during periods of income. During periods of loss, no loss is allocated to participating securities since they have no contractual obligation to share in the losses of the Company. Diluted loss per share is computed after giving consideration to the dilutive effect of stock options, convertible notes, and restricted stock that are outstanding during the period, except where such non-participating securities would be anti-dilutive. The Company’s common stock equivalents, as calculated in accordance with the treasury-stock method for options and unvested restricted stock and the if-converted method for the convertible notes, are shown in the following table (in thousands): Year Ended December 31, 2022 2021 2020 Options outstanding to purchase common stock, shares issuable under the employee stock purchase plan, and unvested restricted stock/units at end of period 33,264 21,296 18,459 Common stock equivalents under treasury stock method for options, shares issuable under the employee stock purchase plan, and unvested restricted stock/units 1,596 2,546 1,301 Shares issuable upon conversion of convertible notes at end of period — — 501 Common stock equivalents under if-converted method for convertible notes — — 501 The Company’s common stock equivalents have not been included in the net loss per share calculation because their effect is anti-dilutive due to the Company’s net loss position. |
Stock-Based Compensation | Stock-based Compensation As of December 31, 2022, the Company is authorized to grant future awards under three employee share-based compensation plans, which are the ImmunoGen, Inc. 2018 Employee, Director and Consultant Equity Incentive Plan, or the 2018 Plan, the Employee Stock Purchase Plan, or ESPP, and the ImmunoGen Inducement Equity Incentive Plan, or the Inducement Plan. At the annual meeting of shareholders on June 15, 2022, the 2018 Plan was amended to provide for the issuance of stock grants, the grant of options, and the grant of stock-based awards for up to an additional 13,000,000 shares of the Company’s common stock, as well as up to 28,742,013 shares of common stock, which represent the number of shares of common stock remaining under the 2018 Plan as of April 1, 2022, and awards previously granted under the 2018 Plan and the Company’s former stock-based plans, including the ImmunoGen, Inc. 2016 and 2006 Employee, Director and Consultant Equity Incentive Plans, that forfeit, expire, or cancel without delivery of shares of common stock or which resulted in the forfeiture of shares of common stock back to the Company subsequent to April 1, 2022. The Inducement Plan was approved by the Board of Directors in December 2019, and pursuant to subsequent amendments, provides for the issuance of non-qualified option grants for up to 10,500,000 shares of the Company’s common stock. Options awarded under the two plans are granted with an exercise price equal to the market price of the Company’s stock at the date of grant. Options vest at various periods of up to four years and may be exercised within ten years of the date of grant under each of these plans. The stock-based awards are accounted for under ASC 718, “Compensation—Stock Compensation Year Ended December 31, 2022 2021 2020 Dividend None None None Volatility 83.09% 84.67% 85.07% Risk-free interest rate 2.76% 0.80% 1.21% Expected life (years) 5.9 6.0 6.0 Using the Black-Scholes option-pricing model, the weighted-average grant date fair values of options granted during the years ended December 31, 2022, 2021, and 2020, were $3.62, $5.07, and $3.28 per share, respectively. A summary of option activity under the option plans for 2022 is presented below (in thousands, except weighted-average data): Weighted- Weighted- Number Average Average Aggregate of Stock Exercise Remaining Intrinsic Options Price Life in Yrs. Value Outstanding at December 31, 2021 21,219 $ 6.28 Granted 13,892 5.11 Exercised (313) 3.89 Forfeited/Canceled (1,672) 7.40 Outstanding at December 31, 2022 33,126 $ 5.76 7.71 $ 11,013 Exercisable at December 31, 2022 15,018 $ 6.27 6.14 $ 7,685 Vested and expected to vest at December 31, 2022 33,126 $ 5.76 7.71 $ 11,013 In 2020, the Company issued 2.6 million performance-based stock options to certain employees that will vest upon the achievement of specified performance goals. Upon assessment of the performance-based stock option awards as of December 31, 2021, the Company determined the first performance goal to be probable of vesting and, as such, recorded $2.6 million of stock-based compensation expense for the year ended December 31, 2021. In May 2022, the first performance goal was achieved, resulting in the vesting of 25% of the 2.6 million performance-based stock options. In November 2022, the second performance goal was achieved, resulting in the vesting of 50% of the 2.6 million performance-based stock options and $5.2 million of stock-based compensation expense recorded for the year ended December 31, 2022. On December 31, 2022, 12.5% of the 2.6 million performance-based stock options forfeited. The fair value of the remaining unvested performance-based stock options that could be expensed in future periods is $1.3 million. A summary of restricted stock and restricted stock unit activity under the option plans for 2022 is presented below (in thousands, except weighted-average data): Number of Weighted- Restricted Average Grant Stock Shares Date Fair Value Unvested at December 31, 2021 77 $ 5.59 Granted 138 5.45 Vested (27) 5.43 Forfeited (50) 5.68 Unvested at December 31, 2022 138 $ 5.45 In June 2018, the Company's Board of Directors, with shareholder approval, adopted the Employee Stock Purchase Plan. Following the share increase on January 1, 2021 under the ESPP’s “evergreen” provision, an aggregate of 2,000,000 shares of common stock have been reserved for issuance under the ESPP. Under the ESPP, eligible participants purchase shares of the Company's common stock at a price equal to 85% of the lesser of the closing price of the Company's common stock on the first business day and the final business day of the applicable plan purchase period. Plan purchase periods are six months and begin on January 1 and July 1 of each year, with purchase dates occurring on the final business day of the given purchase period. The fair value of each ESPP award is estimated on the first day of the offering period using the Black-Scholes option-pricing model. The Company recognizes share-based compensation expense equal to the fair value of the ESPP awards on a straight-line basis over the offering period. During 2022, 2021, and 2020, approximately 178,000, 126,000, and 122,000 shares, respectively, were issued to participating employees at fair values ranging from $1.72 to $2.37 per share. Stock compensation expense related to stock options and restricted stock awards granted under the option plans and the ESPP was $24.9 million, $16.8 million, and $14.0 million during the years ended December 31, 2022, 2021, and 2020, respectively. The increase in stock compensation expense in 2022 was due primarily to the vesting of performance-based stock option awards as discussed above and an increase in the number of stock options granted in 2022 driven by significant hiring in the year. As of December 31, 2022, the estimated fair value of unvested employee awards was $57.4 million. The weighted-average remaining vesting period for these awards is approximately three years. Also included in stock and deferred stock unit compensation expense in the consolidated statements of cash flows for the years ended December 31, 2022, 2021, and 2020 is $0.7 million, $0.7 million, and $0.3 million, respectively, of expense recorded for directors’ deferred share units, the details of which are discussed in Note J. A summary of option activity for options vested during the years ended December 31, 2022, 2021, and 2020 is presented below (in thousands): Year Ended December 31, 2022 2021 2020 Total fair value of options vested $ 25,442 $ 15,839 $ 11,465 Total intrinsic value of options exercised 451 3,322 746 Cash received from the exercise of stock options and ESPP purchases 1,905 3,769 1,471 |
Comprehensive Loss | Comprehensive Loss The Company presents comprehensive loss in accordance with ASC 220, Comprehensive Income. |
Segment Information | Segment Information During all periods presented, the Company continued to operate in one reportable business segment under the management approach of ASC 280, Segment Reporting The percentages of revenues recognized from significant customers of the Company in the years ended December 31, 2022, 2021, and 2020 are included in the following table: Year Ended December 31, Collaborative Partner: 2022 2021 2020 Huadong 37% 24% -% Roche 28% 67% 53% Eli Lilly 17% -% -% Viridian 10% 11% 1% Jazz -% -% 46% There were no other customers of the Company with significant revenues in the periods presented. |
Pending Accounting Pronouncements | Pending Accounting Pronouncements No recently issued or effective ASUs had, or are expected to have, a material effect on the Company's results of operations, financial condition, or liquidity. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies | |
Contract assets and contract liabilities | The following tables present changes in the Company’s contract assets and contract liabilities during the years ended December 31, 2022 and 2021 (in thousands): Balance at Balance at December 31, 2021 Additions Deductions Impact of Netting December 31, 2022 Contract asset $ 3,000 $ — $ (3,000) $ — $ — Contract liabilities (deferred revenue) $ 92,068 $ 7,605 $ (49,462) $ — $ 50,211 Balance at Balance at December 31, 2020 Additions Deductions Impact of Netting December 31, 2021 Contract asset $ — $ 5,500 $ (2,500) $ — $ 3,000 Contract liabilities (deferred revenue) $ 110,109 $ 4,753 $ (22,794) $ — $ 92,068 During the years ended December 31, 2022, 2021, and 2020 the Company recognized the following revenues as a result of changes in contract asset and contract liability balances in the respective periods (in thousands): Year Ended December 31, 2022 2021 2020 Revenue recognized in the period from: Amounts included in contract liabilities at the beginning of the period $ 49,462 $ 22,765 $ 61,872 Performance obligations satisfied in previous periods $ 13,661 $ 5,500 $ — |
Schedule of components of other accrued liabilities | Other accrued liabilities consisted of the following at December 31, 2022 and 2021 (in thousands): December 31, December 31, 2022 2021 Accrued contract payments $ 15,971 $ 5,558 Accrued clinical trial costs 15,716 15,556 Accrued professional services 2,020 839 Accrued employee benefits 340 40 Accrued public reporting charges 265 309 Accrued tax provision 1,218 — Other current accrued liabilities 3,253 775 Total $ 38,783 $ 23,077 |
Schedule of estimated useful lives of property and equipment | Machinery and equipment 5 years Computer hardware and software 3 years Furniture and fixtures 5 years Leasehold improvements Shorter of remaining lease term or 7 years |
Schedule of common stock equivalents, as calculated in accordance with the treasury-stock method | The Company’s common stock equivalents, as calculated in accordance with the treasury-stock method for options and unvested restricted stock and the if-converted method for the convertible notes, are shown in the following table (in thousands): Year Ended December 31, 2022 2021 2020 Options outstanding to purchase common stock, shares issuable under the employee stock purchase plan, and unvested restricted stock/units at end of period 33,264 21,296 18,459 Common stock equivalents under treasury stock method for options, shares issuable under the employee stock purchase plan, and unvested restricted stock/units 1,596 2,546 1,301 Shares issuable upon conversion of convertible notes at end of period — — 501 Common stock equivalents under if-converted method for convertible notes — — 501 |
Schedule of risk-free rate of the stock options based on US Treasury rate | Year Ended December 31, 2022 2021 2020 Dividend None None None Volatility 83.09% 84.67% 85.07% Risk-free interest rate 2.76% 0.80% 1.21% Expected life (years) 5.9 6.0 6.0 |
Summary of stock option activity | A summary of option activity under the option plans for 2022 is presented below (in thousands, except weighted-average data): Weighted- Weighted- Number Average Average Aggregate of Stock Exercise Remaining Intrinsic Options Price Life in Yrs. Value Outstanding at December 31, 2021 21,219 $ 6.28 Granted 13,892 5.11 Exercised (313) 3.89 Forfeited/Canceled (1,672) 7.40 Outstanding at December 31, 2022 33,126 $ 5.76 7.71 $ 11,013 Exercisable at December 31, 2022 15,018 $ 6.27 6.14 $ 7,685 Vested and expected to vest at December 31, 2022 33,126 $ 5.76 7.71 $ 11,013 |
Summary of restricted stock activity | Number of Weighted- Restricted Average Grant Stock Shares Date Fair Value Unvested at December 31, 2021 77 $ 5.59 Granted 138 5.45 Vested (27) 5.43 Forfeited (50) 5.68 Unvested at December 31, 2022 138 $ 5.45 |
Summary of vested stock option activity | A summary of option activity for options vested during the years ended December 31, 2022, 2021, and 2020 is presented below (in thousands): Year Ended December 31, 2022 2021 2020 Total fair value of options vested $ 25,442 $ 15,839 $ 11,465 Total intrinsic value of options exercised 451 3,322 746 Cash received from the exercise of stock options and ESPP purchases 1,905 3,769 1,471 |
Schedule of percentage of total revenues recognized from each significant customer | Year Ended December 31, Collaborative Partner: 2022 2021 2020 Huadong 37% 24% -% Roche 28% 67% 53% Eli Lilly 17% -% -% Viridian 10% 11% 1% Jazz -% -% 46% |
Product Revenue Reserves and _2
Product Revenue Reserves and Allowances (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Product Revenue Reserves and Allowances | |
Schedule of product revenue allowance and reserve categories | The following table summarizes activity in each of the product revenue allowance and reserve categories for the years ended December 31, 2022 and 2021 (in thousands): December 31, December 31, 2022 2021 Beginning balance at January 1 $ — $ — Provision related to sales in the current period 313 — Credits and payments made — — Ending balance at December 31 $ 313 $ — |
Inventory (Tables)
Inventory (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Inventory | |
Schedule of capitalized inventory | Capitalized inventory consists of the following at December 31, 2022 and 2022 (in thousands): December 31, December 31, 2022 2021 Raw materials $ 15,952 $ — Work in process — — Finished goods 244 — Total Inventory $ 16,196 $ — |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property and Equipment | |
Schedule of components of property and equipment | Property and equipment consisted of the following at December 31, 2022 and 2021 (in thousands): December 31, December 31, 2022 2021 Leasehold improvements $ 22,867 $ 22,051 Machinery and equipment 3,063 2,955 Computer hardware and software 6,248 5,846 Furniture and fixtures 3,383 3,265 Assets under construction 180 233 $ 35,741 $ 34,350 Less accumulated depreciation (31,364) (29,687) Property and equipment, net $ 4,377 $ 4,663 |
Liability Related to Sale of _2
Liability Related to Sale of Future Royalties (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Liability Related to Sale of Future Royalties | |
Schedule of Liability account during the period from the inception of the royalty transaction | The following table shows the activity within the liability account during the year ended December 31, 2022 and the period from inception (in thousands): Period from Year Ended inception to December 31, 2022 December 31, 2022 Liability related to sale of future royalties, net — beginning balance $ 41,044 $ — Proceeds from sale of future royalties, net — 194,135 KADCYLA royalty payments received and paid (13,101) (276,958) Non-cash interest expense recognized 4,165 114,931 Liability related to sale of future royalties, net — ending balance $ 32,108 $ 32,108 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Taxes | |
Schedule of loss before provision for income taxes | For the years ended December 31, 2022, 2021 and 2020, the loss before provision for income taxes consist of the following (in thousands): Years Ended December 31, 2022 2021 2020 Domestic $ 18,417 $ (139,303) $ (44,372) Foreign (240,128) — — Total $ (221,711) $ (139,303) $ (44,372) |
Reconciliation of the Company's expected tax benefit, as computed by applying the U.S. federal corporate tax rate to loss before the benefit for income taxes, and actual tax | For the year ended December 31, 2022, the Company’s total tax expense was all federal current expense. The difference between the Company’s expected tax benefit, as computed by applying the applicable U.S. federal corporate tax rate to loss before the benefit for income taxes, and actual tax is reconciled in the following table (in thousands): Years Ended December 31, 2022 2021 2020 Loss before income tax expense $ (221,711) $ (139,303) $ (44,372) Expected tax benefit at 21% $ (46,559) $ (29,254) $ (9,318) Permanent differences 454 606 157 Intra-entity transfer of intangible assets 90,720 — — Incentive stock options 769 420 201 State tax provision (benefit) net of federal benefit 29,304 (7,376) (2,250) Change in valuation allowance, net (75,683) 46,987 15,175 Federal research credit (2,030) (575) (228) Federal orphan drug credit (9,286) (7,429) (6,218) Expired loss and credit carryforwards — 345 419 Withholding tax credit (878) (4,789) — Stock option expirations — 1,065 2,062 Foreign rate differential 14,407 — — Income tax expense $ 1,218 $ — $ — |
Schedule of significant components of deferred tax assets and liabilities | December 31, 2022 2021 Deferred tax assets: Net operating loss carryforwards $ 115,047 $ 264,773 Research and development tax credit carryforwards 103,155 92,832 Property and other intangible assets 1,452 1,150 Deferred revenue 14,561 25,153 Stock-based compensation 18,783 12,195 Operating lease liability 4,421 5,170 Other liabilities 3,144 1,737 Royalty sale 8,393 10,247 Sec 174 R&E capitalization 68,150 — Total deferred tax assets $ 337,106 $ 413,257 Deferred tax liabilities: Operating lease right of use asset (2,967) (3,386) Royalty sale transaction costs (107) (158) Total deferred tax liabilities $ (3,074) $ (3,544) Valuation allowance (334,032) (409,713) Net deferred tax assets/(liabilities) $ — $ — |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases | |
Schedule of maturities of operating lease liabilities | The maturities of operating lease liabilities discussed above are as follows (in thousands): 2023 $ 5,503 2024 5,522 2025 5,543 2026 1,429 2027 13 Total lease payments 18,010 Less imputed interest (2,766) Total lease liabilities $ 15,244 |
Nature of Business and Plan o_2
Nature of Business and Plan of Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Nature of Business and Plan of Operations | |||
Net loss | $ (222,929) | $ (139,303) | $ (44,372) |
Accumulated deficit | (1,694,072) | (1,471,143) | |
Total revenues | 108,782 | 69,856 | $ 132,299 |
Cash and cash equivalents | $ 275,138 | $ 478,750 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Subsequent Events (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Nov. 30, 2022 | Feb. 28, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Subsequent Event [Line Items] | |||||
Upfront fee entitled to receive | $ 15,000 | ||||
Potential milestone payments | $ 125,000 | ||||
Revenue from contract with customer | 108,782 | $ 69,856 | $ 132,299 | ||
Lilly | |||||
Subsequent Event [Line Items] | |||||
License agreement additional payment receivable | $ 19,500 | ||||
License agreement upfront payment receivable | 13,000 | ||||
License agreement, target selection fees and development, regulatory and commercial milestone payments receivable | 1,700,000 | ||||
Upfront payment | |||||
Subsequent Event [Line Items] | |||||
Maximum Amount Entitled to Receive | $ 6,000 | ||||
Upfront payment | CytomX | |||||
Subsequent Event [Line Items] | |||||
Revenue from contract with customer | $ 7,500 | ||||
Upfront payment | Lilly | |||||
Subsequent Event [Line Items] | |||||
Maximum Amount Entitled to Receive | $ 13,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Revenue Recognition (Details) $ in Millions | 1 Months Ended | 12 Months Ended | ||
Aug. 31, 2017 | Dec. 31, 2022 item | Dec. 31, 2020 USD ($) | Dec. 31, 2010 item | |
Bayer HealthCare | ||||
Summary of Significant Accounting Policies | ||||
Number of single-target licenses | 1 | |||
CytomX | ||||
Summary of Significant Accounting Policies | ||||
Number of single-target licenses | 2 | |||
Debiopharm | ||||
Summary of Significant Accounting Policies | ||||
Number of single-target licenses | 1 | |||
Fusion Pharmaceuticals | ||||
Summary of Significant Accounting Policies | ||||
Number of single-target licenses | 1 | |||
Magenta | ||||
Summary of Significant Accounting Policies | ||||
Number of single-target licenses | 1 | |||
Novartis | ||||
Summary of Significant Accounting Policies | ||||
Number of single-target licenses | 1 | 6 | ||
Oxford BioTherapeutics Ltd Member | ||||
Summary of Significant Accounting Policies | ||||
Number of single-target licenses | 1 | |||
Roche | ||||
Summary of Significant Accounting Policies | ||||
Number of single-target licenses | 5 | |||
Hangzhou Zhongmei Huadong Pharmaceutical Co., Ltd | ||||
Summary of Significant Accounting Policies | ||||
Number of single-compound licenses | 1 | |||
Viridian | ||||
Summary of Significant Accounting Policies | ||||
Number of single-target licenses | 1 | |||
Jazz | ||||
Summary of Significant Accounting Policies | ||||
Term of agreement | 7 years | |||
Jazz | License and milestone fees | ||||
Summary of Significant Accounting Policies | ||||
Capitalized Contract Cost, Amortization | $ | $ 60.5 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Performance Obligations (Details) $ in Millions | Dec. 31, 2022 USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation | $ 50.2 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations, percent | 28% |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2027-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations, percent | 70% |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2032-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations, percent | 2% |
Minimum | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, expected timing of satisfaction | 12 months |
Minimum | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2027-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, expected timing of satisfaction | 13 months |
Minimum | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2032-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, expected timing of satisfaction | 61 months |
Maximum | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2027-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, expected timing of satisfaction | 60 months |
Maximum | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2032-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, expected timing of satisfaction | 120 months |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Contract Balances (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Changes in the Company's contract assets and contract liabilities | ||
Contract asset, Beginning balance | $ 3,000 | |
Contract asset, Additions | $ 5,500 | |
Contract asset, Deductions | (3,000) | (2,500) |
Contract asset, Ending balance | 0 | 3,000 |
Contract liabilities: | ||
Contract liabilities (deferred revenue), Beginning balance | 92,068 | 110,109 |
Contract liabilities (deferred revenue), Additions | 7,605 | 4,753 |
Contract liabilities (deferred revenue), Deductions | (49,462) | (22,794) |
Contract liabilities (deferred revenue), Ending balance | 50,211 | 92,068 |
CytomX | Probable Milestone | ||
Changes in the Company's contract assets and contract liabilities | ||
Contract asset, Beginning balance | 3,600 | |
Hangzhou Zhongmei Huadong Pharmaceutical Co., Ltd | Upfront payment | ||
Contract liabilities: | ||
Contract liabilities (deferred revenue), Beginning balance | $ 40,000 | |
Viridian | Probable Milestone | ||
Changes in the Company's contract assets and contract liabilities | ||
Contract asset, Ending balance | $ 3,000 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Revenues Recognized as a Result of Changes in Contract Asset and Liability Balances (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Revenue recognized in the period from: | |||
Amounts included in contract liabilities at the beginning of the period | $ 49,462 | $ 22,765 | $ 61,872 |
Performance obligations satisfied in previous periods | $ 13,661 | $ 5,500 |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies - Contract Balances from Contracts with Customers - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2010 | Aug. 31, 2022 | Feb. 28, 2022 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Contract with customer liability | $ 50,211 | $ 92,068 | $ 110,109 | |||
Revenue from contract with customer | 108,782 | 69,856 | 132,299 | |||
Revenue recognized, previously deferred | 49,462 | 22,765 | 61,872 | |||
Current portion of deferred revenue | 13,856 | 44,351 | ||||
License and milestone fees | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Revenue from contract with customer | 76,027 | 22,650 | 63,742 | |||
Revenue recognized, previously deferred | 2,900 | |||||
Upfront payment | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Current portion of deferred revenue | 1,400 | |||||
Total Revenue Recognized From Both The Beginning Balance And Current Period Increase In Contract Liability | 3,200 | |||||
Upfront Option Fee | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Contract with customer liability | 1,600 | |||||
Hangzhou Zhongmei Huadong Pharmaceutical Co., Ltd | License and milestone fees | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Contract with customer liability | 28,500 | |||||
License agreement upfront payment receivable | 45,000 | |||||
Revenue from contract with customer | 1,800 | |||||
Hangzhou Zhongmei Huadong Pharmaceutical Co., Ltd | Upfront payment | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Contract with customer liability | 40,000 | |||||
Revenue recognized, previously deferred | 0 | |||||
Lilly | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
License agreement upfront payment receivable | $ 13,000 | |||||
Lilly | License and milestone fees | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Revenue from contract with customer | 18,400 | |||||
Lilly | Upfront payment | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Contract with customer liability | 26,000 | |||||
KADCYLA | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Net proceeds from sale of residual rights to receive royalty payments | 7,700 | |||||
KADCYLA | Royalty revenue | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Net proceeds from sale of residual rights to receive royalty payments | 16,400 | |||||
Viridian | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Revenue from contract with customer | $ 3,000 | |||||
Viridian | License and milestone fees | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Revenue from contract with customer | 200 | |||||
Viridian | Future Technological Improvements | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Revenue recognized, previously deferred | 300 | |||||
Novartis | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Contract with customer liability | 2,800 | $ 2,800 | ||||
Novartis | License and milestone fees | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Revenue from contract with customer | 2,800 | |||||
Novartis | Upfront payment | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Revenue from contract with customer | $ 45,000 | |||||
Novartis | Future Technological Improvements | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Contract with customer liability | 800 | |||||
CytomX and Novartis | Probable Milestone | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Current portion of deferred revenue | $ 4,400 | |||||
Magenta Therapeutics | License and milestone fees | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Contract with customer liability | 1,600 | |||||
Revenue from contract with customer | $ 6,000 |
Summary of Significant Accou_10
Summary of Significant Accounting Policies - Financial Instruments and Concentration of Credit Risk (Details) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 USD ($) Institution | Dec. 31, 2021 USD ($) | |
Financial Instruments and Concentration of Credit Risk | ||
Number of financial institutions in the U.S. in which cash and cash equivalents are primarily maintained | Institution | 3 | |
Marketable securities held by entity | $ | $ 0 | $ 0 |
Summary of Significant Accou_11
Summary of Significant Accounting Policies - Cash and Cash Equivalents (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Summary of Significant Accounting Policies | ||
Cash and cash equivalents | $ 275,138 | $ 478,750 |
Summary of Significant Accou_12
Summary of Significant Accounting Policies - Non-cash Investing and Financing Activities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Summary of Significant Accounting Policies | ||
Accrued capital expenditures | $ 300 | $ 200 |
Payments upon settlement of convertible senior notes | $ 1,100 |
Summary of Significant Accou_13
Summary of Significant Accounting Policies - Fair Value of Financial Instruments (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Jul. 31, 2021 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2017 | |
Fair value hierarchy for the Company's financial assets measured at fair value | ||||
Convertible debt amount | $ 1,000 | |||
Convertible debt paid in cash | $ 1,100 | |||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | ||
Convertible 4.5% Senior Notes | ||||
Fair value hierarchy for the Company's financial assets measured at fair value | ||||
Interest rate (as a percent) | 4.50% | 4.50% | ||
Convertible debt paid in cash | $ 1,100 |
Summary of Significant Accou_14
Summary of Significant Accounting Policies - Leases (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Commitments and Contingencies | |
Obligations under finance leases | $ 0 |
Summary of Significant Accou_15
Summary of Significant Accounting Policies - Other Accrued Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Other Accrued Liabilities | ||
Accrued contract payments | $ 15,971 | $ 5,558 |
Accrued clinical trial costs | 15,716 | 15,556 |
Accrued professional services | 2,020 | 839 |
Accrued employee benefits | 340 | 40 |
Accrued public reporting charges | 265 | 309 |
Accrued tax provision | 1,218 | |
Other current accrued liabilities | 3,253 | 775 |
Total | $ 38,783 | $ 23,077 |
Summary of Significant Accou_16
Summary of Significant Accounting Policies- PPE (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Property and Equipment | |||
Net gains (losses) related to impairment charges and the sale/disposal of furniture and equipment | $ 691,000 | ||
Leasehold impairment charge | $ 0 | ||
Asset Impairment Charges | $ 0 | $ 0 | |
Machinery and equipment | |||
Property and Equipment | |||
Estimated useful lives | 5 years | ||
Computer hardware and software | |||
Property and Equipment | |||
Estimated useful lives | 3 years | ||
Furniture and fixtures | |||
Property and Equipment | |||
Estimated useful lives | 5 years | ||
Leasehold improvements | Maximum | |||
Property and Equipment | |||
Estimated useful lives | 7 years |
Summary of Significant Accou_17
Summary of Significant Accounting Policies - Computation of Net Loss per Common Share (Details) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 shares | Dec. 31, 2021 shares | Dec. 31, 2020 USD ($) shares | |
Computation of Net Loss per Common Share | |||
Options outstanding to purchase common stock, shares issuable under the employee stock purchase plan, and unvested restricted stock/units at end of period | 33,264 | 21,296 | 18,459 |
Common stock equivalents under treasury stock method for options, shares issuable under the employee stock purchase plan, and unvested restricted stock/units | 1,596 | 2,546 | 1,301 |
Shares issuable upon conversion of convertible notes at end of period (in shares) | $ | 501 | ||
Common stock equivalents under if-converted method for convertible notes (in shares) | 501 |
Summary of Significant Accou_18
Summary of Significant Accounting Policies - Stock-Based Compensation (Details) | 1 Months Ended | 12 Months Ended | ||||||
Nov. 30, 2022 shares | May 31, 2022 shares | Jun. 30, 2018 shares | Dec. 31, 2022 USD ($) plan $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | Dec. 31, 2020 USD ($) $ / shares shares | Jul. 15, 2022 shares | Apr. 01, 2022 shares | |
Stock-Based Compensation | ||||||||
Number of employee share-based compensation plans | plan | 3 | |||||||
Number of Stock Options | ||||||||
Granted (in shares) | 2,600,000 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||||||||
Aggregate number of common shares reserved for future issuance | 56,000,000 | |||||||
Directors' deferred share unit compensation | $ | $ 716,000 | $ 681,000 | $ 343,000 | |||||
Total fair value of options vested | $ | 25,442,000 | 15,839,000 | 11,465,000 | |||||
Total intrinsic value of options exercised | $ | $ 451,000 | $ 3,322,000 | $ 746,000 | |||||
ESPP | ||||||||
Weighted-Average Grant Date Fair Value | ||||||||
Granted (in dollars per share) | $ / shares | $ 1.72 | $ 2.37 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||||||||
Aggregate number of common shares reserved for future issuance | 2,000,000 | |||||||
Shares issued to participating employees | 178,000 | 126,000 | 122,000 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Purchase Price of Common Stock, Percent | 85% | |||||||
Stock options and restricted stock awards | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||||||||
Stock compensation expense | $ | $ 24,900,000 | $ 16,800,000 | $ 14,000,000 | |||||
Estimated fair value that could be expensed | $ | 57,400,000 | |||||||
Directors' deferred share unit compensation | $ | $ 700,000 | $ 700,000 | $ 300,000 | |||||
Stock options | ||||||||
Weighted-average assumptions used to estimate the fair value of each stock option | ||||||||
Dividend (as a percent) | 0% | 0% | 0% | |||||
Volatility (as a percent) | 83.09% | 84.67% | 85.07% | |||||
Risk-free interest rate (as a percent) | 2.76% | 0.80% | 1.21% | |||||
Expected life | 5 years 10 months 24 days | 6 years | 6 years | |||||
Weighted-average grant date fair value (in dollars per share) | $ / shares | $ 3.62 | $ 5.07 | $ 3.28 | |||||
Number of Stock Options | ||||||||
Outstanding at the beginning of the period (in shares) | 21,219,000 | |||||||
Granted (in shares) | 13,892,000 | |||||||
Exercised (in shares) | (313,000) | |||||||
Forfeited/Canceled (in shares) | (1,672,000) | |||||||
Outstanding at the end of the period (in shares) | 33,126,000 | 21,219,000 | ||||||
Vested or unvested and expected to vest at the end of the period (in shares) | 33,126,000 | |||||||
Exercisable at the end of the period (in shares) | 15,018,000 | |||||||
Weighted-Average Exercise Price | ||||||||
Outstanding at the beginning of the period (in dollars per share) | $ / shares | $ 6.28 | |||||||
Granted (in dollars per share) | $ / shares | 5.11 | |||||||
Exercised (in dollars per share) | $ / shares | 3.89 | |||||||
Forfeited/Canceled (in dollars per share) | $ / shares | 7.40 | |||||||
Outstanding at the end of the period (in dollars per share) | $ / shares | 5.76 | $ 6.28 | ||||||
Vested or unvested and expected to vest at the end of the period (in dollars per share) | $ / shares | 5.76 | |||||||
Exercisable at the end of the period (in dollars per share) | $ / shares | $ 6.27 | |||||||
Weighted-Average Remaining Life (in years) | ||||||||
Outstanding at the end of the period | 7 years 8 months 15 days | |||||||
Vested or unvested and expected to vest at the end of the period | 7 years 8 months 15 days | |||||||
Exercisable at the end of the period | 6 years 1 month 20 days | |||||||
Aggregate Intrinsic Value | ||||||||
Outstanding at the end of the period | $ | $ 11,013,000 | |||||||
Vested or unvested and expected to vest at the end of the period | $ | 11,013,000 | |||||||
Exercisable at the end of the period | $ | $ 7,685,000 | |||||||
Performance shares | ||||||||
Stock-Based Compensation | ||||||||
Vesting percentage | 50% | 25% | 12.50% | |||||
Number of Stock Options | ||||||||
Granted (in shares) | 2,600,000 | 5,200,000 | 2,600,000 | |||||
Forfeited/Canceled (in shares) | (2,600,000) | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||||||||
Stock compensation expense | $ | $ 2,600,000 | |||||||
Estimated fair value that could be expensed | $ | $ 1,300,000 | |||||||
Restricted stock | ||||||||
Number of Restricted Stock Shares | ||||||||
Unvested at the beginning of the period (in shares) | 77,000 | |||||||
Granted (in shares) | 138,000 | |||||||
Vested (in shares) | (27,000) | |||||||
Forfeited (in shares) | (50,000) | |||||||
Unvested at the end of the period (in shares) | 138,000 | 77,000 | ||||||
Weighted-Average Grant Date Fair Value | ||||||||
Unvested at the beginning of the period (in dollars per share) | $ / shares | $ 5.59 | |||||||
Granted (in dollars per share) | $ / shares | 5.45 | |||||||
Vested (in dollars per share) | $ / shares | 5.43 | |||||||
Forfeited (in dollars per share) | $ / shares | 5.68 | |||||||
Unvested at the end of the period (in dollars per share) | $ / shares | $ 5.45 | $ 5.59 | ||||||
Immunogen Inc Restated Stock Option Plan | ||||||||
Stock-Based Compensation | ||||||||
Common stock authorized for issuance (in shares) | 28,742,013 | |||||||
2018 Plan | ||||||||
Stock-Based Compensation | ||||||||
Common stock authorized for issuance (in shares) | 13,000,000 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||||||||
Aggregate number of common shares reserved for future issuance | 32,800,000 | |||||||
2018 Plan | Stock options | ||||||||
Weighted-average assumptions used to estimate the fair value of each stock option | ||||||||
Number of group of awards for which expected term is calculated for and applied | $ | 1 | |||||||
Number of Stock Options | ||||||||
Exercised (in shares) | (313,000) | |||||||
Inducement Plan | ||||||||
Stock-Based Compensation | ||||||||
Number of employee share-based compensation plans | plan | 2 | |||||||
Common stock authorized for issuance (in shares) | 10,500,000 | |||||||
2018 Plan and Inducement Plan | ||||||||
Stock-Based Compensation | ||||||||
Vesting period | 10 years | |||||||
2018 Plan and Inducement Plan | Maximum | ||||||||
Stock-Based Compensation | ||||||||
Vesting period | 4 years |
Summary of Significant Accou_19
Summary of Significant Accounting Policies - Segment Information (Details) - segment | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Segment Information | |||
Number of operating segments | 1 | ||
Other customers | Revenue | Customer concentration | |||
Segment Information | |||
Percentages of revenue recognized | 0% | 0% | 0% |
Roche | Revenue | Customer concentration | |||
Segment Information | |||
Percentages of revenue recognized | 28% | 67% | 53% |
Huadong | Revenue | Customer concentration | |||
Segment Information | |||
Percentages of revenue recognized | 37% | 24% | |
Jazz | Revenue | Customer concentration | |||
Segment Information | |||
Percentages of revenue recognized | 46% | ||
Lilly | Revenue | Customer concentration | |||
Segment Information | |||
Percentages of revenue recognized | 17% | ||
Viridian | Revenue | Customer concentration | |||
Segment Information | |||
Percentages of revenue recognized | 10% | 11% | 1% |
Collaboration and License Agr_2
Collaboration and License Agreements - Roche (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | ||||
May 31, 2000 | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Dec. 31, 2000 USD ($) item | Nov. 30, 2022 USD ($) | |
Collaborative Agreements disclosures | ||||||
Revenue from contract with customer | $ 108,782 | $ 69,856 | $ 132,299 | |||
Potential milestone payment | $ 125,000 | |||||
Non-cash royalty revenue related to sale of future royalties | (12,836) | (39,155) | (68,529) | |||
License and milestone fees | ||||||
Collaborative Agreements disclosures | ||||||
Revenue from contract with customer | $ 76,027 | 22,650 | 63,742 | |||
Roche | ||||||
Collaborative Agreements disclosures | ||||||
Period in arrears to receive royalty reports and payments related to sales of kadcyla | 3 months | 3 months | ||||
Roche | Upfront payment | ||||||
Collaborative Agreements disclosures | ||||||
Revenue from contract with customer | $ 2,000 | |||||
Roche | License and milestone fees | Development and regulatory milestones | ||||||
Collaborative Agreements disclosures | ||||||
Potential milestone payment | $ 44,000 | |||||
Roche | KADCYLA | ||||||
Collaborative Agreements disclosures | ||||||
Revenue from contract with customer | $ 39,000 | |||||
Non-cash royalty revenue related to sale of future royalties | $ (29,300) | $ (46,800) | $ (68,500) | |||
Roche | Undisclosed Target | ||||||
Collaborative Agreements disclosures | ||||||
Number of undisclosed targets with exclusive licenses | item | 4 | |||||
Revenue from contract with customer | $ 1,000 | |||||
Potential milestone payment | $ 38,000 |
Collaboration and License Agr_3
Collaboration and License Agreements - AmgenOxford BioTherapeutics (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Nov. 30, 2022 | |
Collaborative Agreements disclosures | ||||
Revenue from contract with customer | $ 108,782 | $ 69,856 | $ 132,299 | |
Potential milestone payment | $ 125,000 | |||
License and milestone fees | ||||
Collaborative Agreements disclosures | ||||
Revenue from contract with customer | $ 76,027 | $ 22,650 | $ 63,742 |
Collaboration and License Agr_4
Collaboration and License Agreements - Bayer (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Nov. 30, 2022 | |
Collaborative Agreements disclosures | ||||
Total revenues | $ 108,782 | $ 69,856 | $ 132,299 | |
Potential milestone payment | $ 125,000 | |||
License and milestone fees | ||||
Collaborative Agreements disclosures | ||||
Total revenues | $ 76,027 | $ 22,650 | $ 63,742 |
Collaboration and License Agr_5
Collaboration and License Agreements - Novartis (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | |||||
May 31, 2018 item | Dec. 31, 2022 USD ($) item | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Dec. 31, 2010 USD ($) item | Nov. 30, 2022 USD ($) | Aug. 31, 2022 USD ($) | |
Collaborative Agreements disclosures | |||||||
Revenue from contract with customer | $ 108,782 | $ 69,856 | $ 132,299 | ||||
Potential milestone payment | $ 125,000 | ||||||
Contract with Customer, Liability | $ 50,211 | 92,068 | 110,109 | ||||
Novartis | |||||||
Collaborative Agreements disclosures | |||||||
Number of single-target licenses | item | 1 | 6 | |||||
Number of licenses terminated | item | 6 | ||||||
Contract with Customer, Liability | $ 2,800 | $ 2,800 | |||||
Milestone payments plus royalties on the commercial sales | Novartis | |||||||
Collaborative Agreements disclosures | |||||||
Revenue from contract with customer | 5,000 | ||||||
Milestone payments plus royalties on the commercial sales | Novartis | Maximum | |||||||
Collaborative Agreements disclosures | |||||||
Potential milestone payment | 199,500 | ||||||
Upfront payment | Novartis | |||||||
Collaborative Agreements disclosures | |||||||
Revenue from contract with customer | $ 45,000 | ||||||
License and milestone fees | |||||||
Collaborative Agreements disclosures | |||||||
Revenue from contract with customer | 76,027 | 22,650 | 63,742 | ||||
License and milestone fees | Novartis | |||||||
Collaborative Agreements disclosures | |||||||
Revenue from contract with customer | 2,800 | ||||||
Exercise fee | Novartis | |||||||
Collaborative Agreements disclosures | |||||||
Revenue from contract with customer | 1,000 | ||||||
Research and development support | |||||||
Collaborative Agreements disclosures | |||||||
Revenue from contract with customer | $ 940 | $ 398 | $ 28 | ||||
Extension and amendment fee | Novartis | |||||||
Collaborative Agreements disclosures | |||||||
Revenue from contract with customer | $ 8,500 |
Collaboration and License Agr_6
Collaboration and License Agreements- CytomX (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Nov. 30, 2022 | Jun. 30, 2016 | |
Collaborative Agreements disclosures | |||||
Revenue from contract with customer | $ 108,782 | $ 69,856 | $ 132,299 | ||
Contract with customer asset gross | $ 125,000 | ||||
Research and development support | |||||
Collaborative Agreements disclosures | |||||
Revenue from contract with customer | 940 | 398 | 28 | ||
License and milestone fees | |||||
Collaborative Agreements disclosures | |||||
Revenue from contract with customer | 76,027 | $ 22,650 | $ 63,742 | ||
License and milestone fees | CytomX | |||||
Collaborative Agreements disclosures | |||||
Revenue from contract with customer | 4,000 | ||||
License and milestone fees | CytomX | Maximum | |||||
Collaborative Agreements disclosures | |||||
Contract with customer asset gross | $ 355,000 | ||||
License and milestone fees | CytomX | Sales milestones | |||||
Collaborative Agreements disclosures | |||||
Contract with customer asset gross | $ 160,000 |
Collaboration and License Agr_7
Collaboration and License Agreements - Fusion (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Nov. 30, 2022 | |
Collaborative Agreements disclosures | ||||
Revenue from contract with customer | $ 108,782 | $ 69,856 | $ 132,299 | |
Potential milestone payment | $ 125,000 | |||
License and milestone fees | ||||
Collaborative Agreements disclosures | ||||
Revenue from contract with customer | 76,027 | 22,650 | 63,742 | |
Research and development support | ||||
Collaborative Agreements disclosures | ||||
Revenue from contract with customer | $ 940 | $ 398 | $ 28 |
Collaboration and License Agr_8
Collaboration and License Agreements - Debiopharm (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Nov. 30, 2022 | |
Collaborative Agreements disclosures | ||||
Revenue from contract with customer | $ 108,782 | $ 69,856 | $ 132,299 | |
Potential milestone payment | $ 125,000 |
Collaboration and License Agr_9
Collaboration and License Agreements - Viridian (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Nov. 30, 2022 | Oct. 31, 2020 | |
Collaborative Agreements disclosures | |||||
Potential milestone payment | $ 125,000 | ||||
Revenue from contract with customer | $ 108,782 | $ 69,856 | $ 132,299 | ||
Milestone payments receivable included in accounts receivable | 10,000 | ||||
License and milestone fees | |||||
Collaborative Agreements disclosures | |||||
Revenue from contract with customer | 76,027 | 22,650 | $ 63,742 | ||
Milestone payments receivable included in accounts receivable | 10,000 | 5,500 | |||
Viridian | |||||
Collaborative Agreements disclosures | |||||
Revenue from contract with customer | 3,000 | ||||
Milestone payment achieved | 15,500 | ||||
Viridian | License and milestone fees | |||||
Collaborative Agreements disclosures | |||||
Potential milestone payment | $ 143,000 | ||||
Revenue from contract with customer | $ 200 | ||||
Viridian | License and milestone fees | Development milestones | |||||
Collaborative Agreements disclosures | |||||
Revenue from contract with customer | $ 2,500 |
Collaboration and License Ag_10
Collaboration and License Agreements - Huadong (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Nov. 30, 2022 | Oct. 31, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Collaborative Agreements disclosures | |||||
Revenue from contract with customer | $ 108,782 | $ 69,856 | $ 132,299 | ||
Potential milestone payment | $ 125,000 | ||||
Revenue recognized, previously deferred | 49,462 | 22,765 | 61,872 | ||
Upfront payment | |||||
Collaborative Agreements disclosures | |||||
Estimated payments to received | $ 6,000 | ||||
Upfront payment | Huadong | |||||
Collaborative Agreements disclosures | |||||
Revenue from contract with customer | $ 40,000 | ||||
Estimated payments to received | 40,000 | 40,000 | |||
Upfront payment | Huadong | Development milestones | |||||
Collaborative Agreements disclosures | |||||
Revenue recognized, previously deferred | 45,000 | 45,000 | |||
License and milestone fees | |||||
Collaborative Agreements disclosures | |||||
Revenue from contract with customer | 76,027 | 22,650 | 63,742 | ||
Estimated payments to received | 6,000 | ||||
Revenue recognized, previously deferred | 2,900 | ||||
License and milestone fees | Huadong | |||||
Collaborative Agreements disclosures | |||||
Revenue from contract with customer | 28,500 | 16,500 | |||
Potential milestone payment | $ 14,600 | ||||
License and milestone fees | Huadong | Development milestones | |||||
Collaborative Agreements disclosures | |||||
Revenue from contract with customer | $ 10,000 | $ 5,000 | |||
License and milestone fees | Huadong | Sales milestones | |||||
Collaborative Agreements disclosures | |||||
Potential milestone payment | $ 265,000 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | Huadong | |||||
Collaborative Agreements disclosures | |||||
Remaining performance obligation, expected timing of satisfaction | 2 years |
Collaboration and License Ag_11
Collaboration and License Agreements- Jazz Pharmaceuticals (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Aug. 31, 2017 USD ($) item Option | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Nov. 30, 2022 USD ($) | |
Collaborative Agreements disclosures | |||||
Revenue from contract with customer | $ 108,782 | $ 69,856 | $ 132,299 | ||
Potential milestone payment | $ 125,000 | ||||
Contract with customer liability | 50,211 | 92,068 | 110,109 | ||
Revenue recognized, previously deferred | 49,462 | 22,765 | 61,872 | ||
Jazz | |||||
Collaborative Agreements disclosures | |||||
Number of early stage ADC programs | item | 2 | ||||
Potential milestone payment | $ 100,000 | ||||
Term of agreement | 7 years | ||||
Offset to research and development expense | 6,700 | 6,700 | |||
Revenue recognized, previously deferred | 60,500 | ||||
Upfront payment | Jazz | |||||
Collaborative Agreements disclosures | |||||
Revenue from contract with customer | $ 75,000 | ||||
Upfront arrangement consideration number of license options | Option | 3 | ||||
License and milestone fees | |||||
Collaborative Agreements disclosures | |||||
Revenue from contract with customer | 76,027 | 22,650 | 63,742 | ||
Revenue recognized, previously deferred | 2,900 | ||||
Research and development support | |||||
Collaborative Agreements disclosures | |||||
Revenue from contract with customer | $ 940 | $ 398 | $ 28 |
Collaboration and License Ag_12
Collaboration and License Agreements - Takeda (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Nov. 30, 2022 | |
Collaborative Agreements disclosures | ||||
Revenue from contract with customer | $ 108,782 | $ 69,856 | $ 132,299 | |
Potential milestone payment | $ 125,000 | |||
License and milestone fees | ||||
Collaborative Agreements disclosures | ||||
Revenue from contract with customer | 76,027 | 22,650 | 63,742 | |
Research and development support | ||||
Collaborative Agreements disclosures | ||||
Revenue from contract with customer | $ 940 | $ 398 | $ 28 |
Collaboration and License Ag_13
Collaboration and License Agreements - Biotest (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Nov. 30, 2022 | |
Collaborative Agreements disclosures | ||||
Revenue from contract with customer | $ 108,782 | $ 69,856 | $ 132,299 | |
Potential milestone payment | $ 125,000 | |||
License and milestone fees | ||||
Collaborative Agreements disclosures | ||||
Revenue from contract with customer | 76,027 | 22,650 | 63,742 | |
Research and development support | ||||
Collaborative Agreements disclosures | ||||
Revenue from contract with customer | $ 940 | $ 398 | $ 28 |
Collaboration and License Ag_14
Collaboration and License Agreements - Magenta (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Nov. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||
Revenue from contract with customer | $ 108,782 | $ 69,856 | $ 132,299 | |
Potential milestone payments | $ 125,000 | |||
Upfront payment | ||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||
Maximum Amount Entitled to Receive | 6,000 | |||
License and milestone fees | ||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||
Revenue from contract with customer | 76,027 | $ 22,650 | $ 63,742 | |
Maximum Amount Entitled to Receive | $ 6,000 | |||
Magenta | Upfront payment | ||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||
Revenue from contract with customer | $ 6,000 |
Collaboration and License Ag_15
Collaboration and License Agreements - Lilly (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Nov. 30, 2022 | Feb. 28, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Collaborative Agreements disclosures | |||||
Aggregate amount of transaction price allocated to remaining performance obligations | $ 50,200 | ||||
Revenue from contract with customer | 108,782 | $ 69,856 | $ 132,299 | ||
Amount of obligation included in long-term deferred revenue | 36,355 | $ 47,717 | |||
Upfront payment | |||||
Collaborative Agreements disclosures | |||||
Estimated payments to received | $ 6,000 | ||||
Additional targets | |||||
Collaborative Agreements disclosures | |||||
License agreement upfront payment receivable | 13,000 | ||||
Lilly | |||||
Collaborative Agreements disclosures | |||||
License agreement upfront payment receivable | $ 13,000 | ||||
License agreement additional payment receivable | 19,500 | ||||
License agreement, target selection fees and development, regulatory and commercial milestone payments receivable | 1,700,000 | ||||
Aggregate amount of transaction price allocated to remaining performance obligations | 13,000 | ||||
Lilly | Upfront payment | |||||
Collaborative Agreements disclosures | |||||
Estimated payments to received | 13,000 | ||||
Lilly | Initial targets | |||||
Collaborative Agreements disclosures | |||||
Revenue from contract with customer | 9,200 | 18,400 | |||
Lilly | Additional targets | |||||
Collaborative Agreements disclosures | |||||
Revenue from contract with customer | 9,200 | ||||
Lilly | Material rights to obtain licenses to replacement targets | |||||
Collaborative Agreements disclosures | |||||
Revenue from contract with customer | $ 3,800 | ||||
Amount of obligation included in long-term deferred revenue | 7,600 | ||||
Lilly | Material rights to obtain additional target licenses to replacement targets | |||||
Collaborative Agreements disclosures | |||||
Revenue from contract with customer | $ 3,800 |
Product Revenue Reserves and _3
Product Revenue Reserves and Allowances (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Dec. 31, 2022 | |
Product Revenue Reserves and Allowances | ||
Provision related to sales in the current period | $ 2,600 | $ 313 |
Ending balance at December 31 | $ 313 | $ 313 |
Inventory (Details)
Inventory (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Inventory | |
Raw materials | $ 15,952 |
Finished goods | 244 |
Total Inventory | $ 16,196 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Property and Equipment | |||
Property and equipment, gross | $ 35,741 | $ 34,350 | |
Less accumulated depreciation | (31,364) | (29,687) | |
Property and equipment, net | 4,377 | 4,663 | |
Depreciation expense | 1,783 | 2,017 | $ 2,101 |
Agreement to liquidate equipment, cost basis | $ 7,500 | ||
Accumulated depreciation and impairment charges for liquidated equipment | 6,800 | 1,400 | |
Leasehold improvements | |||
Property and Equipment | |||
Property and equipment, gross | 22,867 | 22,051 | |
Machinery and equipment | |||
Property and Equipment | |||
Property and equipment, gross | 3,063 | 2,955 | |
Computer hardware and software | |||
Property and Equipment | |||
Property and equipment, gross | 6,248 | 5,846 | |
Furniture and fixtures | |||
Property and Equipment | |||
Property and equipment, gross | 3,383 | 3,265 | |
Assets under construction | |||
Property and Equipment | |||
Property and equipment, gross | 180 | 233 | |
Equipment under capital leases | |||
Property and Equipment | |||
Property and equipment, gross | 2,200 | 2,100 | |
Less accumulated depreciation | $ (1,800) | $ (1,600) |
Convertible 4.5 Senior Notes (D
Convertible 4.5 Senior Notes (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||||
Jul. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2022 | Dec. 31, 2017 | Dec. 31, 2016 | |
Convertible debt | |||||||
Convertible debt paid in cash | $ 1,100 | ||||||
Interest expense | 47 | $ 95 | |||||
Convertible 4.5% Senior Notes | |||||||
Convertible debt | |||||||
Convertible notes payable | 2,100 | ||||||
Principal amount of debt | $ 100,000 | ||||||
Convertible debt outstanding | $ 1,000 | ||||||
Shares issued with debt conversion (in shares) | 238,777 | ||||||
Convertible debt paid in cash | $ 1,100 | ||||||
Interest rate (as a percent) | 4.50% | 4.50% | |||||
Interest expense | $ 100 | $ 100 |
Liability Related to Sale of _3
Liability Related to Sale of Future Royalties (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | 96 Months Ended | ||||
Jan. 31, 2019 USD ($) | May 31, 2000 | Jun. 30, 2021 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Dec. 31, 2015 USD ($) | Dec. 31, 2022 USD ($) | |
Liability Related to Sale of Future Royalties | ||||||||
Non-cash royalty revenue related to the sale of future royalties | $ 12,836 | $ 39,155 | $ 68,529 | |||||
Kadcyla | ||||||||
Liability Related to Sale of Future Royalties | ||||||||
Percentage of royalty payments if applicable threshold is met | 85% | |||||||
OMERS | Kadcyla | ||||||||
Liability Related to Sale of Future Royalties | ||||||||
Non-cash royalty revenue related to the sale of future royalties | 7,700 | 7,700 | ||||||
Net proceeds from sale of residual rights to receive royalty payments | $ 16,400 | |||||||
IRH | Kadcyla | ||||||||
Liability Related to Sale of Future Royalties | ||||||||
Percentage of royalty payments | 100% | |||||||
Proceeds from sale of future royalties | $ 200,000 | $ 194,135 | ||||||
Percentage of royalty payments if applicable threshold is met | 15% | |||||||
Transaction costs for royalty agreements | $ 5,900 | |||||||
Change in liability related to sale of future royalties | ||||||||
Liability related to sale of future royalties, net - beginning balance | 41,044 | |||||||
Proceeds from sale of future royalties, net | 200,000 | |||||||
KADCYLA royalty payments received and paid | (13,101) | (276,958) | ||||||
Non-cash interest expense recognized | 4,165 | 114,931 | ||||||
Liability related to sale of future royalties, net - ending balance | $ 32,108 | 41,044 | $ 32,108 | |||||
Current effective interest rate | 10.5 | |||||||
IRH | Kadcyla | Maximum | ||||||||
Liability Related to Sale of Future Royalties | ||||||||
Royalties threshold | 260,000 | |||||||
IRH | Kadcyla | Minimum | ||||||||
Liability Related to Sale of Future Royalties | ||||||||
Royalties threshold | $ 235,000 | |||||||
OMERS | Kadcyla | ||||||||
Liability Related to Sale of Future Royalties | ||||||||
Percentage of royalty payments | 100% | |||||||
Non-cash royalty revenue related to the sale of future royalties | $ 65,200 | |||||||
Contingent broker fees | 1,500 | |||||||
Net proceeds from sale of residual rights to receive royalty payments | $ 65,200 | |||||||
Roche | ||||||||
Liability Related to Sale of Future Royalties | ||||||||
Period in arrears to receive royalty reports and payments related to sales of kadcyla | 3 months | 3 months | ||||||
Roche | Kadcyla | ||||||||
Liability Related to Sale of Future Royalties | ||||||||
Non-cash royalty revenue related to the sale of future royalties | $ 29,300 | $ 46,800 | $ 68,500 |
Income Taxes - Loss before prov
Income Taxes - Loss before provision for income taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Reconciliation of the expected statutory tax benefit to the actual income taxes | |||
Loss before income tax expense | $ (221,711) | $ (139,303) | $ (44,372) |
Domestic | |||
Reconciliation of the expected statutory tax benefit to the actual income taxes | |||
Loss before income tax expense | 18,417 | $ (139,303) | $ (44,372) |
Foreign | |||
Reconciliation of the expected statutory tax benefit to the actual income taxes | |||
Loss before income tax expense | $ (240,128) |
Income Taxes - Benefit for inco
Income Taxes - Benefit for income taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Reconciliation of the expected statutory tax benefit to the actual income taxes | |||
U.S. federal corporate tax rate (as a percent) | 21% | 21% | 21% |
Loss before income tax expense | $ (221,711) | $ (139,303) | $ (44,372) |
Expected tax benefit at 21% | (46,559) | (29,254) | (9,318) |
Permanent differences | 454 | 606 | 157 |
Intra-entity transfer of intangible assets | 90,720 | ||
Incentive stock options | 769 | 420 | 201 |
State tax benefit net of federal benefit | 29,304 | (7,376) | (2,250) |
Change in valuation allowance, net | (75,683) | 46,987 | 15,175 |
Federal research credit | (2,030) | (575) | (228) |
Federal orphan drug credit | (9,286) | (7,429) | (6,218) |
Expired loss and credit carryforwards | 345 | 419 | |
Withholding tax credit | (878) | (4,789) | |
Stock option expirations | 1,065 | 2,062 | |
Foreign rate differential | 14,407 | ||
Benefit for income taxes | $ 1,218 | $ 0 | $ 0 |
Income Taxes - Carryforward (De
Income Taxes - Carryforward (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Carryforward | |
Deferred tax asset | $ 68,150 |
Domestic | |
Carryforward | |
Operating loss carryforward | 443,300 |
Credit carryforwards | 85,600 |
State | |
Carryforward | |
Operating loss carryforward | 251,100 |
Credit carryforwards | 11,100 |
Foreign | |
Carryforward | |
Credit carryforwards | $ 6,500 |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax assets: | ||
Net operating loss carryforwards | $ 115,047 | $ 264,773 |
Research and development tax credit carryforwards | 103,155 | 92,832 |
Property and other intangible assets | 1,452 | 1,150 |
Deferred revenue | 14,561 | 25,153 |
Stock-based compensation | 18,783 | 12,195 |
Operating lease liability | 4,421 | 5,170 |
Other liabilities | 3,144 | 1,737 |
Royalty sale | 8,393 | 10,247 |
Sec 174 R&E capitalization | 68,150 | |
Total deferred tax assets | 337,106 | 413,257 |
Deferred tax liabilities: | ||
Operating lease right of use asset | (2,967) | (3,386) |
Royalty sale transaction costs | (107) | (158) |
Total deferred tax liabilities | 3,074 | 3,544 |
Valuation allowance | $ (334,032) | $ (409,713) |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Tax Cuts and Jobs Act (TCJA) | |||
Increase in valuation allowance | $ 75,700,000 | ||
U.S. federal corporate tax rate (as a percent) | 21% | 21% | 21% |
Income Tax Uncertainties | |||
Ownership change occurred, based off study | 0 | ||
Uncertain tax positions reported | $ 0 | $ 0 |
Capital Stock (Details)
Capital Stock (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Nov. 30, 2022 shares | Aug. 31, 2021 USD ($) $ / shares shares | Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | Dec. 31, 2020 USD ($) shares | Jun. 30, 2018 shares | |
Stock-based compensation disclosure | ||||||
Aggregate number of common shares reserved for future issuance | 56,000,000 | |||||
Stock options granted to directors (in shares) | 2,600,000 | |||||
Proceeds from issuance of common stock under stock plans | $ | $ 1,905 | $ 3,769 | $ 1,471 | |||
Exercise price | $ / shares | $ 6.60 | |||||
Warrant exercise price | $ / shares | $ 0.01 | $ 0.01 | ||||
Transaction costs | $ | 373 | $ 701 | ||||
Proceeds from issuance of convertible bonds, issuance costs | $ | 373 | $ 701 | ||||
ESPP | ||||||
Stock-based compensation disclosure | ||||||
Aggregate number of common shares reserved for future issuance | 2,000,000 | |||||
Proceeds from Stock Plans | $ | $ 700 | |||||
Stock issued during period shares employee stock purchase plans | 178,000 | |||||
Pre-Funded Warrants | ||||||
Stock-based compensation disclosure | ||||||
Exercise price | $ / shares | $ 6.59 | |||||
Threshold percentage of common stock owned that limits the number of warrants exercised | 9.99 | |||||
Maximum percentage upon at least 61 days prior notice from the investor to the Company | 19.99 | |||||
RA Capital Healthcare Fund, L.P. | Pre-Funded Warrants | ||||||
Stock-based compensation disclosure | ||||||
Pre-Funded warrants issued to purchase shares | 16,000,000 | |||||
Redmile Group LLC | Pre-Funded Warrants | ||||||
Stock-based compensation disclosure | ||||||
Pre-Funded warrants issued to purchase shares | 11,363,636 | |||||
Stock options | ||||||
Stock-based compensation disclosure | ||||||
Stock options granted to directors (in shares) | 13,892,000 | |||||
Exercise price (in dollars per share) | $ / shares | $ 2.31 | |||||
Exercise price (in dollars per share) | $ / shares | $ 5.25 | |||||
Proceeds from issuance of common stock under stock plans | $ | $ 1,200 | |||||
Exercisable at the end of the period (in shares) | 15,018,000 | |||||
Weighted-Average Exercise Price (in dollars per share) | $ / shares | $ 6.27 | |||||
Options exercised (in shares) | 313,000 | |||||
Securities Purchase Agreement | RA Capital Healthcare Fund, L.P. | Pre-Funded Warrants | ||||||
Stock-based compensation disclosure | ||||||
Pre-Funded warrants issued to purchase shares | 5,434,782 | |||||
Exercise price | $ / shares | $ 5.51 | |||||
Aggregate gross proceeds | $ | $ 29,900 | |||||
Transaction costs | $ | 200 | |||||
Proceeds from issuance of convertible bonds, issuance costs | $ | $ 200 | |||||
2018 Plan | ||||||
Stock-based compensation disclosure | ||||||
Aggregate number of common shares reserved for future issuance | 32,800,000 | |||||
2018 Plan | Stock options | ||||||
Stock-based compensation disclosure | ||||||
Options exercised (in shares) | 313,000 | |||||
Compensation Policy for Non-Employee Directors | Deferred share units | ||||||
Stock-based compensation disclosure | ||||||
Common stock issued to retiring directors (in shares) | 148,000 | 166,000 | 127,000 | |||
Common stock issued when a director ceases to be a member (in shares) | 1 | |||||
Stock units previously granted (in shares) | 100,000 | 52,000 | 15,000 | |||
Compensation expense | $ | $ 700 | $ 700 | $ 300 | |||
Compensation Policy for Non-Employee Directors | Stock options | ||||||
Stock-based compensation disclosure | ||||||
Stock options granted to directors (in shares) | 321,622 | 352,000 | 300,000 |
Leases (Details)
Leases (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) ft² item lease | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) ft² agreement | |
Lessee, Lease, Description [Line Items] | ||||
Number of real estate leases | lease | 1 | |||
Lessee, Operating Lease, Existence of Option to Extend [true false] | true | |||
Lease liabilities | $ 15,244 | |||
Weighted-average discount rate | 11% | |||
100 basis point change effect on ROU asset | $ 1,000 | |||
Lease expense for operating lease payments | 4,000 | $ 4,000 | $ 4,000 | |
Leasehold impairment charge | 0 | |||
Cash paid against operating lease liabilities | 5,300 | 5,300 | ||
Right-of-use assets | $ 10,231 | 12,392 | ||
Weighted average remaining term of the operating leases | 3 years 3 months | |||
Sublease income | $ 1,100 | $ 4,900 | ||
Sub lessee lease incentive payable | $ 4,000 | 4,000 | ||
Payment of sub lessee lease incentive | $ 1,800 | |||
Sublease minimum future rental payment receivable forgiven | $ 4,600 | |||
830 Winter Street, Waltham, MA | ||||
Lessee, Lease, Description [Line Items] | ||||
Area of space leased | ft² | 120,000 | |||
Number of additional terms for which lease agreement can be extended | item | 2 | |||
Operating lease term extension period | 5 years | |||
Winter Street 930 Waltham MA | ||||
Lessee, Lease, Description [Line Items] | ||||
Number of executed sub-lease spaces | agreement | 4 | |||
Area of executed sublease space | ft² | 65,000 | |||
Minimum rental payments over the remaining term of the sublease | $ 5,700 |
Leases - Maturities of Operatin
Leases - Maturities of Operating Lease Liabilities (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Leases | |
2023 | $ 5,503 |
2024 | 5,522 |
2025 | 5,543 |
2026 | 1,429 |
2027 | 13 |
Total lease payments | 18,010 |
Less imputed interest | (2,766) |
Total lease liabilities | 15,244 |
Variable operating costs and real estate taxes | $ 3,800 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Oct. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Collaborations and Manufacturing Commitments | ||||
Research and development | $ 213,370 | $ 151,117 | $ 114,592 | |
2012 license agreement with a contract manufacturing vendor | ||||
Collaborations and Manufacturing Commitments | ||||
Specific development and sales-based milestone payments | $ 18,000 | |||
Research and development | 6,000 | $ 3,000 | ||
In-process and future manufacturing of antibody, drug substance, and cytotoxic agents | ||||
Collaborations and Manufacturing Commitments | ||||
Noncancelable obligations under several agreements | 17,900 | |||
Minimum | ||||
Collaborations and Manufacturing Commitments | ||||
Manufacturing commitment | $ 43,700 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Related Party Transaction | ||
Payments to related party | $ 5 | |
License and milestone fees | ||
Related Party Transaction | ||
Revenue from related parties | $ 6 | $ 6 |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Employee Benefit Plans | |||
Maximum employees' contribution (as a percent) | 100% | ||
Matching contribution of first 6% of eligible employees' contributions (as a percent) | 50% | ||
Percentage of eligible employees' contributions matched by the company | 6% | ||
Company's contribution | $ 1 | $ 0.5 | $ 0.4 |
Agreements - Novartis (Details)
Agreements - Novartis (Details) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2022 USD ($) item | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Dec. 31, 2010 item | Nov. 30, 2022 USD ($) | Aug. 31, 2022 USD ($) | |
Collaborative Agreements disclosures | ||||||
Potential milestone payment | $ 125,000 | |||||
Revenue from contract with customer | $ 108,782 | $ 69,856 | $ 132,299 | |||
Contract with customer liability | 50,211 | 92,068 | 110,109 | |||
License and milestone fees | ||||||
Collaborative Agreements disclosures | ||||||
Revenue from contract with customer | 76,027 | $ 22,650 | $ 63,742 | |||
Novartis | ||||||
Collaborative Agreements disclosures | ||||||
Contract with customer liability | $ 2,800 | $ 2,800 | ||||
Number of single-target licenses | item | 1 | 6 | ||||
Novartis | License and milestone fees | ||||||
Collaborative Agreements disclosures | ||||||
Revenue from contract with customer | $ 2,800 | |||||
Novartis | Milestone payments plus royalties on the commercial sales | ||||||
Collaborative Agreements disclosures | ||||||
Revenue from contract with customer | 5,000 | |||||
Novartis | Future Technological Improvements | ||||||
Collaborative Agreements disclosures | ||||||
Contract with customer liability | $ 800 | |||||
Roche | ||||||
Collaborative Agreements disclosures | ||||||
Number of single-target licenses | item | 5 | |||||
Maximum | Novartis | Milestone payments plus royalties on the commercial sales | ||||||
Collaborative Agreements disclosures | ||||||
Potential milestone payment | $ 199,500 |