Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2014 | Nov. 05, 2014 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'ISIS PHARMACEUTICALS INC | ' |
Entity Central Index Key | '0000874015 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Sep-14 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Well-known Seasoned Issuer | 'Yes | ' |
Entity Voluntary Filers | 'No | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 118,141,113 |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $73,220 | $159,973 |
Short-term investments | 518,766 | 496,788 |
Contracts receivable | 26,313 | 11,102 |
Inventories | 7,085 | 8,033 |
Investment in Regulus Therapeutics Inc. | 47,426 | 52,096 |
Other current assets | 8,353 | 7,518 |
Total current assets | 681,163 | 735,510 |
Property, plant and equipment, net | 88,068 | 86,198 |
Licenses, net | 3,160 | 4,572 |
Patents, net | 16,879 | 15,517 |
Deposits and other assets | 4,533 | 5,359 |
Total assets | 793,803 | 847,156 |
Current liabilities: | ' | ' |
Accounts payable | 15,627 | 11,009 |
Accrued compensation | 7,164 | 12,168 |
Accrued liabilities | 29,140 | 22,092 |
Current portion of long-term obligations | 3,667 | 4,408 |
Current portion of deferred contract revenue | 51,727 | 48,135 |
Total current liabilities | 107,325 | 97,812 |
Long-term deferred contract revenue | 110,614 | 142,790 |
2 3/4 percent convertible senior notes | 155,437 | 150,334 |
Long-term obligations, less current portion | 4,039 | 6,542 |
Long-term financing liability for leased facility | 71,616 | 71,288 |
Total liabilities | 449,031 | 468,766 |
Stockholders' equity: | ' | ' |
Common stock, $0.001 par value; 300,000,000 shares authorized, 117,990,371 and 116,471,371 shares issued and outstanding at September 30, 2014 and December 31, 2013, respectively | 118 | 116 |
Additional paid-in capital | 1,365,407 | 1,324,804 |
Accumulated other comprehensive income | 16,894 | 21,080 |
Accumulated deficit | -1,037,647 | -967,610 |
Total stockholders' equity | 344,772 | 378,390 |
Total liabilities and stockholders' equity | $793,803 | $847,156 |
CONDENSED_CONSOLIDATED_BALANCE1
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
LIABILITIES AND STOCKHOLDERS' EQUITY | ' | ' |
Interest rate on convertible senior notes (in hundredths) | 2.75% | 2.75% |
Stockholders' equity: | ' | ' |
Common stock, par value (in dollars per share) | $0.00 | $0.00 |
Common stock, shares authorized (in shares) | 300,000,000 | ' |
Common stock, shares issued (in shares) | 117,990,371 | 116,471,371 |
Common stock, shares outstanding (in shares) | 117,990,371 | 116,471,371 |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Revenue: | ' | ' | ' | ' |
Research and development revenue under collaborative agreements | $43,798 | $23,258 | $119,975 | $102,543 |
Licensing and royalty revenue | 265 | 327 | 9,325 | 2,493 |
Total revenue | 44,063 | 23,585 | 129,300 | 105,036 |
Expenses: | ' | ' | ' | ' |
Research, development and patent expenses | 61,086 | 45,660 | 173,798 | 126,603 |
General and administrative | 4,470 | 3,430 | 13,313 | 10,241 |
Total operating expenses | 65,556 | 49,090 | 187,111 | 136,844 |
Loss from operations | -21,493 | -25,505 | -57,811 | -31,808 |
Other income (expense): | ' | ' | ' | ' |
Investment income | 675 | 434 | 2,003 | 1,400 |
Interest expense | -4,998 | -4,867 | -14,902 | -14,470 |
Gain on investments, net | 538 | 175 | 675 | 2,073 |
Loss before income tax (expense) benefit | -25,278 | -29,763 | -70,035 | -42,805 |
Income tax (expense) benefit | -1,398 | 5,193 | -2 | 6,437 |
Net loss | ($26,676) | ($24,570) | ($70,037) | ($36,368) |
Basic and diluted net loss per share (in dollars per share) | ($0.23) | ($0.21) | ($0.60) | ($0.33) |
Shares used in computing basic and diluted net loss per share | 117,811 | 115,263 | 117,511 | 108,608 |
CONDENSED_CONSOLIDATED_STATEME1
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | ||||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) [Abstract] | ' | ' | ' | ' | ||||
Net loss | ($26,676) | ($24,570) | ($70,037) | ($36,368) | ||||
Unrealized (losses) gains on securities, net of tax | -6,994 | 2,207 | -3,189 | 17,876 | ||||
Reclassification adjustment for realized gains included in net loss | -831 | [1] | -172 | [1] | -997 | [1] | -1,335 | [1] |
Comprehensive loss | ($34,501) | ($22,535) | ($74,223) | ($19,827) | ||||
[1] | Included in gain on investments, net on our condensed consolidated statement of operations. |
CONDENSED_CONSOLIDATED_STATEME2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Operating activities: | ' | ' |
Net loss | ($70,037) | ($36,368) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ' | ' |
Depreciation | 4,791 | 4,995 |
Amortization of patents | 841 | 891 |
Amortization of licenses | 1,412 | 1,531 |
Amortization of premium on investments, net | 5,649 | 3,742 |
Amortization of debt issuance costs | 412 | 308 |
Amortization of 2 3/4 percent convertible senior notes discount | 5,103 | 4,715 |
Amortization of long-term financing liability for leased facility | 4,962 | 4,919 |
Stock-based compensation expense | 22,894 | 8,318 |
Gain on investments, net | -675 | -2,073 |
Non-cash losses related to patents, licensing and property, plant and equipment | 753 | 429 |
Changes in operating assets and liabilities: | ' | ' |
Contracts receivable | -15,211 | -12,123 |
Inventories | 948 | -1,264 |
Other current and long-term assets | -1,239 | -1,535 |
Accounts payable | 1,414 | -2,293 |
Accrued compensation | -5,004 | -1,225 |
Deferred rent | 126 | 173 |
Accrued liabilities | 7,046 | 443 |
Deferred contract revenue | -28,584 | 104,402 |
Net cash (used in) provided by operating activities | -64,399 | 77,985 |
Investing activities: | ' | ' |
Purchases of short-term investments | -250,580 | -303,862 |
Proceeds from the sale of short-term investments | 222,896 | 135,130 |
Purchases of property, plant and equipment | -3,969 | -1,113 |
Acquisition of licenses and other assets, net | -2,443 | -2,721 |
Proceeds from the sale of strategic investments | 2,036 | 2,110 |
Net cash used in investing activities | -32,060 | -170,456 |
Financing activities: | ' | ' |
Proceeds from equity awards | 17,709 | 56,898 |
Net proceeds from public common stock offering | 0 | 173,292 |
Proceeds from equipment financing arrangement | 0 | 2,513 |
Principal payments on debt and capital lease obligations | -8,003 | -8,306 |
Net cash provided by financing activities | 9,706 | 224,397 |
Net (decrease) increase in cash and cash equivalents | -86,753 | 131,926 |
Cash and cash equivalents at beginning of period | 159,973 | 124,482 |
Cash and cash equivalents at end of period | 73,220 | 256,408 |
Supplemental disclosures of cash flow information: | ' | ' |
Interest paid | 2,977 | 3,079 |
Income taxes paid | 0 | 2 |
Supplemental disclosures of non-cash investing and financing activities: | ' | ' |
Amounts accrued for capital and patent expenditures | $3,204 | $835 |
Basis_of_Presentation
Basis of Presentation | 9 Months Ended | ||
Sep. 30, 2014 | |||
Basis of Presentation [Abstract] | ' | ||
Basis of Presentation | ' | ||
1 | Basis of Presentation | ||
The unaudited interim condensed consolidated financial statements for the three and nine months ended September 30, 2014 and 2013 have been prepared on the same basis as the audited financial statements for the year ended December 31, 2013. The financial statements include all normal recurring adjustments, which we consider necessary for a fair presentation of our financial position at such dates and our operating results and cash flows for those periods. Results for the interim periods are not necessarily indicative of the results for the entire year. For more complete financial information, these financial statements, and notes thereto, should be read in conjunction with the audited financial statements for the year ended December 31, 2013 included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission, or SEC. | |||
The condensed consolidated financial statements include the accounts of Isis Pharmaceuticals, Inc. (“we”, “us” or “our”) and our wholly owned subsidiary, Symphony GenIsis, Inc., which is currently inactive. |
Significant_Accounting_Policie
Significant Accounting Policies | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Significant Accounting Policies [Abstract] | ' | ||||||||||||||||
Significant Accounting Policies | ' | ||||||||||||||||
2 | Significant Accounting Policies | ||||||||||||||||
Revenue Recognition | |||||||||||||||||
We generally recognize revenue when we have satisfied all contractual obligations and are reasonably assured of collecting the resulting receivable. We are often entitled to bill our customers and receive payment from our customers in advance of recognizing the revenue. In the instances in which we have received payment from our customers in advance of recognizing revenue, we include the amounts in deferred revenue on our condensed consolidated balance sheet. | |||||||||||||||||
Research and development revenue under collaborative agreements | |||||||||||||||||
Our collaboration agreements typically contain multiple elements, or deliverables, including technology licenses or options to obtain technology licenses, research and development services, and in certain cases manufacturing services. Our collaborations may provide for various types of payments to us including upfront payments, funding of research and development, milestone payments, licensing fees, profit sharing and royalties on product sales. We evaluate the deliverables in our collaboration agreements to determine whether they meet the criteria to be accounted for as separate units of accounting or whether they should be combined with other deliverables and accounted for as a single unit of accounting. When the delivered items in an arrangement have “stand-alone value” to our customer, we account for the deliverables as separate units of accounting and we allocate the consideration to each unit of accounting based on the relative selling price of each deliverable. Delivered items have stand-alone value if they are sold separately by any vendor or the customer could resell the delivered items on a stand-alone basis. We use the following hierarchy of values to estimate the selling price of each deliverable: (i) vendor-specific objective evidence of fair value; (ii) third-party evidence of selling price; and (iii) best estimate of selling price, or BESP. The BESP reflects our best estimate of what the selling price would be if we regularly sold the deliverable on a stand-alone basis. We recognize the revenue allocated to each unit of accounting as we deliver the related goods or services. If we determine that we should treat certain deliverables as a single unit of accounting, then we recognize the revenue ratably over our estimated period of performance. | |||||||||||||||||
In December 2012, we entered into a collaboration agreement with AstraZeneca to discover and develop antisense therapeutics against five cancer targets. As part of the collaboration, we received a $25 million upfront payment in December 2012 and a $6 million payment in June 2013 when AstraZeneca elected to continue the research collaboration. We are also eligible to receive milestone payments, license fees for the research program targets and royalties on any product sales of drugs resulting from this collaboration. In exchange, we granted AstraZeneca an exclusive license to develop and commercialize ISIS-STAT3Rx and ISIS-ARRx. We also granted AstraZeneca options to license up to three cancer drugs under the separate research program. We were responsible for completing IND-enabling studies for ISIS-ARRx, which we completed earlier this year. We are also responsible for completing an ongoing clinical study of ISIS-STAT3Rx. AstraZeneca is responsible for all other global development, regulatory and commercialization activities for ISIS-STAT3Rx and ISIS-ARRx. In addition, if AstraZeneca exercises its option for any drugs resulting from the research program, AstraZeneca will assume global development, regulatory and commercialization responsibilities for such drug. Since this agreement has multiple elements, we evaluated the deliverables in this arrangement when we entered into the agreement and determined that certain deliverables, either individually or in combination, have stand-alone value. Below is a list of the four separate units of accounting under our agreement: | |||||||||||||||||
● | The exclusive license we granted to AstraZeneca to develop and commercialize ISIS-STAT3Rx for the treatment of cancer; | ||||||||||||||||
● | The development services we are performing for ISIS-STAT3Rx; | ||||||||||||||||
● | The exclusive license we granted to AstraZeneca to develop and commercialize ISIS-ARRx and the research services we performed for ISIS-ARRx; and | ||||||||||||||||
● | The option to license up to three drugs under a research program and the research services we will perform for this program. | ||||||||||||||||
We determined that the ISIS-STAT3Rx license had stand-alone value because it is an exclusive license that gives AstraZeneca the right to develop ISIS-STAT3Rx or to sublicense its rights. In addition, ISIS-STAT3Rx is currently in development and it is possible that AstraZeneca or another third party could conduct clinical trials without assistance from us. As a result, we considered the ISIS-STAT3Rx license and the development services for ISIS-STAT3Rx to be separate units of accounting. We recognized the portion of the consideration allocated to the ISIS-STAT3Rx license immediately because we delivered the license and earned the revenue. We are recognizing as revenue the amount allocated to the development services for ISIS-STAT3Rx over the period of time we perform services. The ISIS-ARRx license is also an exclusive license. At the inception of the agreement, ISIS-ARRx was in an early stage of research. Therefore, we concluded that our knowledge and expertise with antisense technology was essential for AstraZeneca or another third party to successfully develop ISIS-ARRx. As a result, we determined that the ISIS-ARRx license did not have stand-alone value and we combined the ISIS-ARRx license and related research services into one unit of accounting. We recognized revenue for the combined unit of accounting over the period of time we performed services, which ended in the first quarter of 2014. We determined that the options under the research program did not have stand-alone value because AstraZeneca cannot develop or commercialize drugs resulting from the research program until AstraZeneca exercises the respective option or options. As a result, we considered the research options and the related research services as a combined unit of accounting. We are recognizing revenue for the combined unit of accounting over the period of our performance. | |||||||||||||||||
We determined that the initial allocable arrangement consideration was the $25 million upfront payment because it was the only payment that was fixed and determinable when we entered into the agreement. In June 2013, we increased the allocable consideration to $31 million when we received the $6 million payment. There was considerable uncertainty at the date of the agreement as to whether we would earn the milestone payments, royalty payments, payments for manufacturing clinical trial materials or payments for finished drug product. As such, we did not include those payments in the allocable consideration. | |||||||||||||||||
We allocated the allocable consideration based on the relative BESP of each unit of accounting. We engaged a third party, independent valuation expert to assist us with determining BESP. We estimated the selling price of the licenses granted for ISIS-STAT3Rx and ISIS-ARRx by using the relief from royalty method. Under this method, we estimated the amount of income, net of taxes, for each drug. We then discounted the projected income for each license to present value. The significant inputs we used to determine the projected income of the licenses included: | |||||||||||||||||
● | Estimated future product sales; | ||||||||||||||||
● | Estimated royalties on future product sales; | ||||||||||||||||
● | Contractual milestone payments; | ||||||||||||||||
● | Expenses we expect to incur; | ||||||||||||||||
● | Income taxes; and | ||||||||||||||||
● | An appropriate discount rate. | ||||||||||||||||
We estimated the selling price of the research and development services by using our internal estimates of the cost to perform the specific services, marked up to include a reasonable profit margin, and estimates of expected cash outflows to third parties for services and supplies over the expected period that we will perform research and development. The significant inputs we used to determine the selling price of the research and development services included: | |||||||||||||||||
● | The number of internal hours we will spend performing these services; | ||||||||||||||||
● | The estimated number and cost of studies we will perform; | ||||||||||||||||
● | The estimated number and cost of studies that we will contract with third parties to perform; and | ||||||||||||||||
● | The estimated cost of drug product we will use in the studies. | ||||||||||||||||
As a result of the allocation, we recognized $9.3 million of the $25 million upfront payment for the ISIS-STAT3Rx license in December 2012 and we recognized $2.2 million of the $6 million payment for the ISIS-STAT3Rx license in June 2013. We are recognizing the remaining $19.5 million of the $31 million over the estimated period of our performance. Assuming a constant selling price for the other elements in the arrangement, if there was an assumed ten percent increase or decrease in the estimated selling price of the ISIS-STAT3Rx license, we determined that the revenue we would have allocated to the ISIS-STAT3Rx license would change by approximately seven percent, or $750,000, from the amount we recorded. | |||||||||||||||||
Typically, we must estimate our period of performance when the agreements we enter into do not clearly define such information. Our collaborative agreements typically include a research and/or development project plan outlining the activities the agreement requires each party to perform during the collaboration. We estimate the period of time over which we will complete the activities for which we are responsible and use that period of time as our period of performance for purposes of revenue recognition and amortize revenue over such period. We have made estimates of our continuing obligations under numerous agreements and in certain instances the timing of satisfying these obligations may change as the development plans for our drugs progress. Accordingly, our estimates may change in the future. If our estimates and judgments change over the course of these agreements, it may affect the timing and amount of revenue that we recognize in future periods. For example, we adjusted the period of performance on our collaboration with GSK and our ISIS-SMNRx collaboration with Biogen Idec. As a result of adding two new development candidates, ISIS-HBVRx and ISIS-GSK4Rx, to our collaboration with GSK, our period of performance was extended beyond our initial estimate. Therefore, we extended the amortization period to correspond to the new extended period of performance. Similarly, with our ISIS-SMNRx collaboration, we extended the amortization period to correspond to the expansion of the Phase 3 study in infants with Spinal Muscular Atrophy, or SMA. Since we extended the amortization period for our GSK collaboration and our ISIS-SMNRx collaboration, revenue from the amortization of upfront payments for these collaborations will be $3.7 million less in 2014 compared to 2013. | |||||||||||||||||
From time to time, we may enter into separate agreements at or near the same time with the same customer. We evaluate such agreements to determine whether they should be accounted for individually as distinct arrangements or whether the separate agreements are, in substance, a single multiple element arrangement. We evaluate whether the negotiations are conducted jointly as part of a single negotiation, whether the deliverables are interrelated or interdependent, whether fees in one arrangement are tied to performance in another arrangement, and whether elements in one arrangement are essential to another arrangement. Our evaluation involves significant judgment to determine whether a group of agreements might be so closely related that they are, in effect, part of a single arrangement. For example, since early 2012 we have entered into four collaboration agreements with Biogen Idec: | |||||||||||||||||
● | In January 2012, we entered into a collaboration agreement with Biogen Idec to develop and commercialize ISIS-SMNRx for SMA. As part of the collaboration, we received a $29 million upfront payment and we are responsible for global development of ISIS-SMNRx through completion of Phase 2/3 clinical trials. | ||||||||||||||||
● | In June 2012, we entered into a second and separate collaboration agreement with Biogen Idec to develop and commercialize a novel antisense drug targeting DMPK, or dystrophia myotonica-protein kinase. As part of the collaboration, we received a $12 million upfront payment and we are responsible for global development of the drug through the completion of a Phase 2 clinical trial. | ||||||||||||||||
● | In December 2012, we entered into a third and separate collaboration agreement with Biogen Idec to discover and develop antisense drugs against three targets to treat neurological or neuromuscular disorders. As part of the collaboration, we received a $30 million upfront payment and we are responsible for the discovery of a lead antisense drug for each of three targets. | ||||||||||||||||
● | In September 2013, we entered into a fourth and separate collaboration agreement with Biogen Idec to leverage antisense technology to advance the treatment of neurological diseases. We granted Biogen Idec exclusive rights to the use of our antisense technology to develop therapies for neurological diseases as part of this broad collaboration. We received a $100 million upfront payment and we are responsible for discovery and early development through the completion of a Phase 2 clinical trial for each antisense drug identified during the six year term of this collaboration, while Biogen Idec is responsible for the creation and development of small molecule treatments and biologics. | ||||||||||||||||
All four of these collaboration agreements give Biogen Idec the option or options to license one or more drugs resulting from the specific collaboration. If Biogen Idec exercises an option, it will pay us a license fee and will assume future development, regulatory and commercialization responsibilities for the licensed drug. We are also eligible to receive milestone payments associated with the research and/or development of the drugs prior to licensing, milestone payments if Biogen Idec achieves pre-specified regulatory milestones, and royalties on any product sales of drugs resulting from these collaborations. | |||||||||||||||||
We evaluated all four of the Biogen Idec agreements to determine whether we should account for them as separate agreements. We determined that we should account for the agreements separately because we conducted the negotiations independently of one another, each agreement focuses on different drugs, there are no interrelated or interdependent deliverables, there are no provisions in any of these agreements that are essential to the other agreement, and the payment terms and fees under each agreement are independent of each other. We also evaluated the deliverables in each of these agreements to determine whether they met the criteria to be accounted for as separate units of accounting or whether they should be combined with other deliverables and accounted for as a single unit of accounting. For all four of these agreements, we determined that the options did not have stand-alone value because Biogen Idec cannot pursue the development or commercialization of the drugs resulting from these collaborations until it exercises the respective option or options. As such, for each agreement we considered the deliverables to be a single unit of accounting and we are recognizing the upfront payment for each of the agreements over the respective estimated period of our performance. | |||||||||||||||||
Our collaborations often include contractual milestones, which typically relate to the achievement of pre-specified development, regulatory and commercialization events. These three categories of milestone events reflect the three stages of the life-cycle of our drugs, which we describe in more detail in the following paragraph. | |||||||||||||||||
Prior to the first stage in the life-cycle of our drugs, we perform a significant amount of work using our proprietary antisense technology to design chemical compounds that interact with specific genes that are good targets for drug discovery. From these research efforts, we hope to identify a development candidate. The designation of a development candidate is the first stage in the life-cycle of our drugs. A development candidate is a chemical compound that has demonstrated the necessary safety and efficacy in preclinical animal studies to warrant further study in humans. During the first step of the development stage, we or our partners study our drugs in IND-enabling studies, which are animal studies intended to support an Investigational New Drug, or IND, application and/or the foreign equivalent. An approved IND allows us or our partners to study our development candidate in humans. If the regulatory agency approves the IND, we or our partners initiate Phase 1 clinical trials in which we typically enroll a small number of healthy volunteers to ensure the development candidate is safe for use in patients. If we or our partners determine that a development candidate is safe based on the Phase 1 data, we or our partners initiate Phase 2 studies that are generally larger scale studies in patients with the primary intent of determining the efficacy of the development candidate. The final step in the development stage is Phase 3 studies to gather the necessary safety and efficacy data to request marketing approval from the Food and Drug Administration, or FDA, and/or foreign equivalents. The Phase 3 studies typically involve large numbers of patients and can take up to several years to complete. If the data gathered during the trials demonstrates acceptable safety and efficacy results, we or our partner will submit an application to the FDA and/or its foreign equivalents for marketing approval. This stage of the drug’s life-cycle is the regulatory stage. If a drug achieves marketing approval, it moves into the commercialization stage, during which our partner will market and sell the drug to patients. Although our partner will ultimately be responsible for marketing and selling the partnered drug, our efforts to discover and develop a drug that is safe, effective and reliable contributes significantly to our partner’s ability to successfully sell the drug. The FDA and its foreign equivalents have the authority to impose significant restrictions on an approved drug through the product label and on advertising, promotional and distribution activities. Therefore, our efforts designing and executing the necessary animal and human studies are critical to obtaining claims in the product label from the regulatory agencies that would allow our partner to successfully commercialize our drug. Further, the patent protection afforded our drugs as a result of our initial patent applications and related prosecution activities in the United States and foreign jurisdictions are critical to our partner’s ability to sell our drugs without competition from generic drugs. The potential sales volume of an approved drug is dependent on several factors including the size of the patient population, market penetration of the drug, and the price charged for the drug. | |||||||||||||||||
Generally, the milestone events contained in our partnership agreements coincide with the progression of our drugs from development, to regulatory approval and then to commercialization. The process of successfully discovering a new development candidate, having it approved and ultimately sold for a profit is highly uncertain. As such, the milestone payments we may earn from our partners involve a significant degree of risk to achieve. Therefore, as a drug progresses through the stages of its life-cycle, the value of the drug generally increases. | |||||||||||||||||
Development milestones in our partnerships may include the following types of events: | |||||||||||||||||
● | Designation of a development candidate. Following the designation of a development candidate, IND-enabling animal studies for a new development candidate generally take 12 to 18 months to complete; | ||||||||||||||||
● | Initiation of a Phase 1 clinical trial. Generally, Phase 1 clinical trials take one to two years to complete; | ||||||||||||||||
● | Initiation or completion of a Phase 2 clinical trial. Generally, Phase 2 clinical trials take one to three years to complete; | ||||||||||||||||
● | Initiation or completion of a Phase 3 clinical trial. Generally, Phase 3 clinical trials take two to four years to complete. | ||||||||||||||||
Regulatory milestones in our partnerships may include the following types of events: | |||||||||||||||||
● | Filing of regulatory applications for marketing approval such as a New Drug Application, or NDA, in the United States or a Marketing Authorization Application, or MAA, in Europe. Generally, it takes six to twelve months to prepare and submit regulatory filings. | ||||||||||||||||
● | Marketing approval in a major market, such as the United States, Europe or Japan. Generally it takes one to two years after an application is submitted to obtain approval from the applicable regulatory agency. | ||||||||||||||||
Commercialization milestones in our partnerships may include the following types of events | |||||||||||||||||
● | First commercial sale in a particular market, such as in the United States or Europe. | ||||||||||||||||
● | Product sales in excess of a pre-specified threshold, such as annual sales exceeding $1 billion. The amount of time to achieve this type of milestone depends on several factors including but not limited to the dollar amount of the threshold, the pricing of the product and the pace at which customers begin using the product. | ||||||||||||||||
We assess whether a substantive milestone exists at the inception of our agreements. When a substantive milestone is achieved, we recognize revenue related to the milestone payment. For our existing licensing and collaboration agreements in which we are involved in the discovery and/or development of the related drug or provide the partner with access to new technologies we discover, we have determined that the majority of future development, regulatory and commercialization milestones are substantive. For example, we consider most of the milestones associated with our strategic alliance with Biogen Idec substantive because we are using our antisense drug discovery platform to discover and develop new drugs against targets for neurological diseases. Alternatively, we considered milestones associated with our strategic alliance with Alnylam Pharmaceuticals, Inc. substantive because we provided Alnylam ongoing access to our technology to develop and commercialize RNA interference, or RNAi, therapeutics. In evaluating if a milestone is substantive we consider whether: | |||||||||||||||||
● | Substantive uncertainty exists as to the achievement of the milestone event at the inception of the arrangement; | ||||||||||||||||
● | The achievement of the milestone involves substantive effort and can only be achieved based in whole or in part on our performance or the occurrence of a specific outcome resulting from our performance; | ||||||||||||||||
● | The amount of the milestone payment appears reasonable either in relation to the effort expended or to the enhancement of the value of the delivered items; | ||||||||||||||||
● | There is no future performance required to earn the milestone; and | ||||||||||||||||
● | The consideration is reasonable relative to all deliverables and payment terms in the arrangement. | ||||||||||||||||
If any of these conditions are not met, we do not consider the milestone to be substantive and we defer recognition of the milestone payment and recognize it as revenue over the estimated period of performance, if any. We consider most milestone payments related to progression of a drug through the development and regulatory stages of its life cycle to be substantive milestones because the level of effort and inherent risk associated with these events is high. Further information about our collaborative arrangements can be found in Note 7, Collaborative Arrangements and Licensing Agreements. | |||||||||||||||||
Licensing and royalty revenue | |||||||||||||||||
We often enter into agreements to license our proprietary patent rights on an exclusive or non-exclusive basis in exchange for license fees and/or royalties. We generally recognize as revenue immediately those licensing fees and royalties for which we have no significant future performance obligations and are reasonably assured of collecting the resulting receivable. For example, in the first quarter of 2014, we recognized $7.7 million in sublicensing revenue from Alnylam related to its collaboration with Genzyme because we have no performance obligations related to Alnylam’s relationship with Genzyme and collectability was reasonably assured. | |||||||||||||||||
Cash, cash equivalents and short-term investments | |||||||||||||||||
We consider all liquid investments with maturities of three months or less when we purchase them to be cash equivalents. Our short-term investments have initial maturities of greater than three months from date of purchase. We classify our short-term investments as “available-for-sale” and carry them at fair market value based upon prices for identical or similar items on the last day of the fiscal period. We record unrealized gains and losses as a separate component of comprehensive income (loss) and include net realized gains and losses in gain (loss) on investments. We use the specific identification method to determine the cost of securities sold. | |||||||||||||||||
We have equity investments in privately- and publicly-held biotechnology companies that we have received as part of a technology license or collaboration agreement. At September 30, 2014 we held ownership interests of less than 20 percent in each of the respective companies. | |||||||||||||||||
We account for our equity investments in publicly-held companies at fair value and record unrealized gains and losses related to temporary increases and decreases in the stock of these publicly-held companies as a separate component of comprehensive income (loss). We account for equity investments in privately-held companies under the cost method of accounting because we own less than 20 percent and do not have significant influence over their operations. We hold one cost method investment in a small company, which we call a satellite company, and realization of our equity position in this company is uncertain. In this circumstance we recorded a full valuation allowance. In determining if and when a decrease in market value below our cost in our equity positions is temporary or other-than-temporary, we examine historical trends in the stock price, the financial condition of the company, near term prospects of the company and our current need for cash. If we determine that a decline in value in either a public or private investment is other-than-temporary, we recognize an impairment loss in the period in which the other-than-temporary decline occurs. | |||||||||||||||||
Inventory valuation | |||||||||||||||||
We capitalize the costs of raw materials that we purchase for use in producing our drugs because until we use these raw materials they have alternative future uses. We include in inventory raw material costs for drugs that we manufacture for our partners under contractual terms and that we use primarily in our clinical development activities and drug products. We can use each of our raw materials in multiple products and, as a result, each raw material has future economic value independent of the development status of any single drug. For example, if one of our drugs failed, we could use the raw materials for that drug to manufacture our other drugs. We expense these costs when we deliver the drugs to our partners, or as we provide these drugs for our own clinical trials. We reflect our inventory on the balance sheet at the lower of cost or market value under the first-in, first-out method. We review inventory periodically and reduce the carrying value of items we consider to be slow moving or obsolete to their estimated net realizable value. We consider several factors in estimating the net realizable value, including shelf life of raw materials, alternative uses for our drugs and clinical trial materials, and historical write-offs. We did not record any inventory write-offs for the nine months ended September 30, 2014 and 2013. Total inventory, which consisted of raw materials, was $7.1 million and $8.0 million as of September 30, 2014 and December 31, 2013, respectively. | |||||||||||||||||
Research, development and patent expenses | |||||||||||||||||
Our research and development expenses include wages, benefits, facilities, supplies, external services, clinical trial and manufacturing costs and other expenses that are directly related to our research and development operations. We expense research and development costs as we incur them. When we make payments for research and development services prior to the services being rendered, we record those amounts as prepaid assets on our condensed consolidated balance sheet and we expense them as the services are provided. | |||||||||||||||||
We capitalize costs consisting principally of outside legal costs and filing fees related to obtaining patents. We amortize patent costs over the useful life of the patent, beginning with the date the United States Patent and Trademark Office, or foreign equivalent, issues the patent. We review our capitalized patent costs regularly to ensure that they include costs for patents and patent applications that have future value. We evaluate patents and patent applications that we are not actively pursuing and write off any associated costs. For the three and nine months ended September 30, 2014, patent expenses included non-cash charges related to the write-down of our patent costs to their estimated net realizable values of $0.5 million and $0.8 million, respectively, compared to $0.2 million and $0.4 million for the same periods in 2013. | |||||||||||||||||
Long-lived assets | |||||||||||||||||
We evaluate long-lived assets, which include property, plant and equipment, patent costs, and exclusive licenses acquired from third parties, for impairment on at least a quarterly basis and whenever events or changes in circumstances indicate that we may not be able to recover the carrying amount of such assets. | |||||||||||||||||
Use of estimates | |||||||||||||||||
The preparation of condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results could differ from those estimates. | |||||||||||||||||
Reclassifications | |||||||||||||||||
We have reclassified certain immaterial prior period amounts to conform to the current period presentation. Certain amounts previously reported as research and development revenue have been reclassified to licensing and royalty revenue to conform to the current period presentation. | |||||||||||||||||
Basic and diluted net loss per share | |||||||||||||||||
We compute basic net loss per share by dividing the net loss by the weighted-average number of common shares outstanding during the period. As we incurred a net loss for the three and nine months ended September 30, 2014 and 2013, we did not include dilutive common equivalent shares in the computation of diluted net loss per share because the effect would have been anti-dilutive. Common stock from the following would have had an anti-dilutive effect on net loss per share: | |||||||||||||||||
● | 2¾ percent convertible senior notes; | ||||||||||||||||
● | Dilutive stock options; and | ||||||||||||||||
● | Restricted stock units. | ||||||||||||||||
Consolidation of variable interest entities | |||||||||||||||||
We identify entities as variable interest entities either: (1) that do not have sufficient equity investment at risk to permit the entity to finance its activities without additional subordinated financial support, or (2) in which the equity investors lack an essential characteristic of a controlling financial interest. We perform ongoing qualitative assessments of our variable interest entities to determine whether we have a controlling financial interest in the variable interest entity and therefore are the primary beneficiary. As of September 30, 2014 and December 31, 2013, we had collaborative arrangements with four and five entities, respectively, that we considered to be variable interest entities. We are not the primary beneficiary for any of these entities because we do not have the power to direct the activities that most significantly impact the economic performance of our variable interest entities, the obligation to absorb losses, or the right to receive benefits from our variable interest entities that could potentially be significant to the variable interest entities. As of September 30, 2014, the total carrying value of our investments in variable interest entities was $48.4 million, and was primarily related to our investment in Regulus. Our maximum exposure to loss related to these variable interest entities is limited to the carrying value of our investments. | |||||||||||||||||
Accumulated other comprehensive income | |||||||||||||||||
Accumulated other comprehensive income is comprised of unrealized gains and losses on securities, net of taxes, and adjustments we made to reclassify realized gains and losses on securities from other accumulated comprehensive income to our condensed consolidated statement of operations. The following table summarizes changes in accumulated other comprehensive income for the three and nine months ended September 30, 2014 and 2013 (in thousands): | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Beginning balance accumulated other comprehensive income | $ | 24,719 | $ | 26,986 | $ | 21,080 | $ | 12,480 | |||||||||
Unrealized (losses) gains on securities, net of tax (1) | (6,994 | ) | 2,207 | (3,189 | ) | 17,876 | |||||||||||
Amounts reclassified from accumulated other comprehensive income (2) | (831 | ) | (172 | ) | (997 | ) | (1,335 | ) | |||||||||
Net current period other comprehensive (loss) income | (7,825 | ) | 2,035 | (4,186 | ) | 16,541 | |||||||||||
Ending balance accumulated other comprehensive income | $ | 16,894 | $ | 29,021 | $ | 16,894 | $ | 29,021 | |||||||||
-1 | Other comprehensive (loss) income for the three months ended September 30, 2014 included income tax benefit of $2.5 million, compared to income tax expense of $1.4 million and $11.4 million for the three and nine months ended September 30, 2013, respectively. We recorded no income tax benefit or expense for the nine months ended September 30, 2014. | ||||||||||||||||
-2 | Included in gain on investments, net on our condensed consolidated statement of operations. | ||||||||||||||||
Convertible debt | |||||||||||||||||
In August 2012, we completed a $201.3 million offering of convertible senior notes, which mature in 2019 and bear interest at 2¾ percent. In September 2012, we used a substantial portion of the net proceeds from the issuance of the 2¾ percent notes to redeem our 2⅝ percent convertible subordinated notes. We account for our 2¾ percent notes by separating the liability and equity components of the instrument in a manner that reflects our nonconvertible debt borrowing rate. As a result, we assigned a value to the debt component of our 2 ¾ percent notes equal to the estimated fair value of similar debt instruments without the conversion feature, which resulted in us recording the debt instrument at a discount. We are amortizing the debt discount over the life of these 2¾ percent notes as additional non-cash interest expense utilizing the effective interest method. | |||||||||||||||||
Segment information | |||||||||||||||||
We operate in a single segment, Drug Discovery and Development operations, because our chief decision maker reviews operating results on an aggregate basis and manages our operations as a single operating segment. | |||||||||||||||||
Stock-based compensation expense | |||||||||||||||||
We measure stock-based compensation expense for equity-classified awards, principally related to stock options, restricted stock units, or RSUs, and stock purchase rights under our Employee Stock Purchase Plan, or ESPP, based on the estimated fair value of the award on the date of grant. We recognize the value of the portion of the award that we ultimately expect to vest as stock-based compensation expense over the requisite service period in our condensed consolidated statements of operations. We reduce stock-based compensation expense for estimated forfeitures at the time of grant and revise in subsequent periods if actual forfeitures differ from those estimates. | |||||||||||||||||
We use the Black-Scholes model to estimate the fair value of stock options granted and stock purchase rights under our ESPP. The expected term of stock options granted represents the period of time that we expect them to be outstanding. We estimate the expected term of options granted based on historical exercise patterns. For the nine months ended September 30, 2014 and 2013, we used the following weighted-average assumptions in our Black-Scholes calculations: | |||||||||||||||||
Employee Stock Options: | |||||||||||||||||
Nine Months Ended | |||||||||||||||||
September 30, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Risk-free interest rate | 1.60% | 1.00% | |||||||||||||||
Dividend yield | 0.00% | 0.00% | |||||||||||||||
Volatility | 50.70% | 51.40% | |||||||||||||||
Expected life | 4.6 years | 5.1 years | |||||||||||||||
ESPP: | |||||||||||||||||
Nine Months Ended | |||||||||||||||||
September 30, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Risk-free interest rate | 0.10% | 0.10% | |||||||||||||||
Dividend yield | 0.00% | 0.00% | |||||||||||||||
Volatility | 60.60% | 62.90% | |||||||||||||||
Expected life | 6 months | 6 months | |||||||||||||||
Board of Director Stock Options: | |||||||||||||||||
Nine Months Ended | |||||||||||||||||
September 30, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Risk-free interest rate | 2.20% | 2.20% | |||||||||||||||
Dividend yield | 0.00% | 0.00% | |||||||||||||||
Volatility | 54.20% | 52.70% | |||||||||||||||
Expected life | 6.9 years | 7.2 years | |||||||||||||||
The fair value of RSUs is based on the market price of our common stock on the date of grant. RSUs vest annually over a four year period. The weighted-average grant date fair value of RSUs granted to employees and the Board of Directors for the nine months ended September 30, 2014 was $45.80 and $38.10, respectively. | |||||||||||||||||
The following table summarizes stock-based compensation expense for the three and nine months ended September 30, 2014 and 2013 (in thousands), which was allocated as follows: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Research, development and patent expenses | $ | 6,606 | $ | 2,373 | $ | 18,879 | $ | 7,171 | |||||||||
General and administrative | 1,512 | 439 | 4,015 | 1,147 | |||||||||||||
Total | $ | 8,118 | $ | 2,812 | $ | 22,894 | $ | 8,318 | |||||||||
Non-cash stock-based compensation was $8.1 million and $22.9 million for the three and nine months ended September 30, 2014, respectively, and increased compared to $2.8 million and $8.3 million for the same periods in 2013 primarily due to the increase in our stock price. As of September 30, 2014, total unrecognized estimated non-cash stock-based compensation expense related to non-vested stock options and RSUs was $26.4 million and $11.5 million, respectively. We will adjust total unrecognized compensation cost for future changes in estimated forfeitures. We expect to recognize the cost of non-cash, stock-based compensation expense related to non-vested stock options and RSUs over a weighted average amortization period of 1.3 years and 1.5 years, respectively. | |||||||||||||||||
Impact of recently issued accounting standards | |||||||||||||||||
In May 2014, the FASB issued accounting guidance on the recognition of revenue from customers. Under this guidance, an entity will recognize revenue when it transfers promised goods or services to customers in an amount that reflects what the entity expects in exchange for the goods or services. This guidance also requires more detailed disclosures to enable users of the financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016. The guidance allows us to select one of two methods of adoption, either the full retrospective approach, meaning the guidance would be applied to all periods presented, or modified retrospective, meaning the cumulative effect of applying the guidance would be recognized as an adjustment to our opening retained earnings balance. We will adopt this guidance in our fiscal year beginning January 1, 2017. We are currently evaluating an adoption method and the impact this guidance will have on our consolidated financial position, results of operations, cash flows and disclosures, and are currently unable to estimate the impact of this guidance. | |||||||||||||||||
In August 2014, the FASB issued accounting guidance on how and when to disclose going-concern uncertainties in the financial statements. This guidance requires us to perform interim and annual assessments to determine our ability to continue as a going concern within one year from the date that we issue our financial statements. The guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016. We will adopt this guidance in our fiscal year beginning January 1, 2017. We do not expect this guidance to have any effect on our financial statements. |
Investments
Investments | 9 Months Ended | ||||||||||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||||||||||
Investments [Abstract] | ' | ||||||||||||||||||||||||||||
Investments | ' | ||||||||||||||||||||||||||||
3 | Investments | ||||||||||||||||||||||||||||
As of September 30, 2014, we have invested our excess cash primarily in debt instruments of the U.S. Treasury, financial institutions, corporations, and U.S. government agencies with strong credit ratings and an investment grade rating at or above A-1, P-1 or F-1 by Moody’s, Standard & Poor’s (S&P) or Fitch, respectively. We have established guidelines relative to diversification and maturities that maintain safety and liquidity. We periodically review and modify these guidelines to maximize trends in yields and interest rates without compromising safety and liquidity. | |||||||||||||||||||||||||||||
The following table summarizes the contract maturity of the available-for-sale securities we held as of September 30, 2014: | |||||||||||||||||||||||||||||
One year or less | 57% | ||||||||||||||||||||||||||||
After one year but within two years | 32% | ||||||||||||||||||||||||||||
After two years but within three years | 11% | ||||||||||||||||||||||||||||
Total | 100% | ||||||||||||||||||||||||||||
As illustrated above, we primarily invest our excess cash in short-term instruments with 89 percent of our available-for-sale securities having a maturity of less than two years. | |||||||||||||||||||||||||||||
All of our available-for-sale securities are available to us for use in our current operations. As a result, we categorize all of these securities as current assets even though the stated maturity of some individual securities may be one year or more beyond the balance sheet date. | |||||||||||||||||||||||||||||
At September 30, 2014, we had an ownership interest of less than 20 percent in one private company and four public companies with which we conduct business. The privately-held company is Atlantic Pharmaceuticals Limited and the publicly-traded companies are Antisense Therapeutics Limited, Achaogen Inc., iCo Therapeutics Inc., and Regulus. We account for equity investments in the privately-held companies under the cost method of accounting and we account for equity investments in the publicly-traded companies at fair value. We record unrealized gains and losses as a separate component of comprehensive income (loss) and include net realized gains and losses in gain (loss) on investments. | |||||||||||||||||||||||||||||
The following is a summary of our investments (in thousands): | |||||||||||||||||||||||||||||
Amortized | Unrealized | Other- | Estimated | ||||||||||||||||||||||||||
Than- | |||||||||||||||||||||||||||||
Temporary | |||||||||||||||||||||||||||||
Impairment | |||||||||||||||||||||||||||||
30-Sep-14 | Cost | Gains | Losses | Loss | Fair Value | ||||||||||||||||||||||||
Available-for-sale securities: | |||||||||||||||||||||||||||||
Corporate debt securities(1) | $ | 205,973 | $ | 153 | $ | (67 | ) | $ | — | $ | 206,059 | ||||||||||||||||||
Debt securities issued by U.S. government agencies (1) | 51,021 | 13 | (35 | ) | — | 50,999 | |||||||||||||||||||||||
Debt securities issued by the U.S. Treasury | 9,022 | 18 | — | — | 9,040 | ||||||||||||||||||||||||
Debt securities issued by states of the United States and political subdivisions of the states | 38,134 | 19 | (48 | ) | — | 38,105 | |||||||||||||||||||||||
Total securities with a maturity of one year or less | 304,150 | 203 | (150 | ) | — | 304,203 | |||||||||||||||||||||||
Corporate debt securities | 148,079 | 55 | (345 | ) | — | 147,789 | |||||||||||||||||||||||
Debt securities issued by U.S. government agencies | 55,525 | 5 | (132 | ) | — | 55,398 | |||||||||||||||||||||||
Debt securities issued by states of the United States and political subdivisions of the states | 26,275 | 41 | (77 | ) | — | 26,239 | |||||||||||||||||||||||
Total securities with a maturity of more than one year | 229,879 | 101 | (554 | ) | — | 229,426 | |||||||||||||||||||||||
Total available-for-sale securities | $ | 534,029 | $ | 304 | $ | (704 | ) | $ | — | $ | 533,629 | ||||||||||||||||||
Cost | Unrealized | Other- | Estimated | ||||||||||||||||||||||||||
Than- | |||||||||||||||||||||||||||||
Temporary | |||||||||||||||||||||||||||||
Impairment | |||||||||||||||||||||||||||||
30-Sep-14 | Basis | Gains | Losses | Loss | Fair Value | ||||||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||||||
Regulus Therapeutics Inc. | $ | 15,316 | $ | 32,110 | $ | — | $ | — | $ | 47,426 | |||||||||||||||||||
Securities included in other current assets | 1,269 | 1,021 | — | (1,269 | ) | 1,021 | |||||||||||||||||||||||
Total equity securities | $ | 16,585 | $ | 33,131 | $ | — | $ | (1,269 | ) | $ | 48,447 | ||||||||||||||||||
Total available-for-sale and equity securities | $ | 550,614 | $ | 33,435 | $ | (704 | ) | $ | (1,269 | ) | $ | 582,076 | |||||||||||||||||
Amortized | Unrealized | Other- | Estimated | ||||||||||||||||||||||||||
Than- | |||||||||||||||||||||||||||||
Temporary | |||||||||||||||||||||||||||||
Impairment | |||||||||||||||||||||||||||||
31-Dec-13 | Cost | Gains | Losses | Loss | Fair Value | ||||||||||||||||||||||||
Available-for-sale securities: | |||||||||||||||||||||||||||||
Corporate debt securities(1) | $ | 142,096 | $ | 75 | $ | (27 | ) | $ | — | $ | 142,144 | ||||||||||||||||||
Debt securities issued by U.S. government agencies (1) | 23,242 | 22 | (16 | ) | — | 23,248 | |||||||||||||||||||||||
Debt securities issued by the U.S. Treasury | 6,239 | 6 | — | — | 6,245 | ||||||||||||||||||||||||
Debt securities issued by states of the United States and political subdivisions of the states | 8,082 | 6 | (28 | ) | — | 8,060 | |||||||||||||||||||||||
Total securities with a maturity of one year or less | 179,659 | 109 | (71 | ) | — | 179,697 | |||||||||||||||||||||||
Corporate debt securities | 265,969 | 177 | (393 | ) | — | 265,753 | |||||||||||||||||||||||
Debt securities issued by U.S. government agencies | 41,308 | 3 | (127 | ) | — | 41,184 | |||||||||||||||||||||||
Debt securities issued by the U.S. Treasury | 9,062 | 21 | — | — | 9,083 | ||||||||||||||||||||||||
Debt securities issued by states of the United States and political subdivisions of the states | 14,186 | 37 | (28 | ) | — | 14,195 | |||||||||||||||||||||||
Total securities with a maturity of more than one year | 330,525 | 238 | (548 | ) | — | 330,215 | |||||||||||||||||||||||
Total available-for-sale securities | $ | 510,184 | $ | 347 | $ | (619 | ) | $ | — | $ | 509,912 | ||||||||||||||||||
Cost | Unrealized | Other- | Estimated | ||||||||||||||||||||||||||
Than- | |||||||||||||||||||||||||||||
Temporary | |||||||||||||||||||||||||||||
Impairment | |||||||||||||||||||||||||||||
31-Dec-13 | Basis | Gains | Losses | Loss | Fair Value | ||||||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||||||
Regulus Therapeutics Inc. | $ | 15,526 | $ | 36,570 | $ | — | $ | — | $ | 52,096 | |||||||||||||||||||
Securities included in other current assets | 1,538 | 618 | — | (880 | ) | 1,276 | |||||||||||||||||||||||
Securities included in deposits and other assets | 625 | — | — | — | 625 | ||||||||||||||||||||||||
Total equity securities | $ | 17,689 | $ | 37,188 | $ | — | $ | (880 | ) | $ | 53,997 | ||||||||||||||||||
Total available-for-sale and equity securities | $ | 527,873 | $ | 37,535 | $ | (619 | ) | $ | (880 | ) | $ | 563,909 | |||||||||||||||||
-1 | Includes investments classified as cash equivalents on our condensed consolidated balance sheet. | ||||||||||||||||||||||||||||
Investments we considered to be temporarily impaired at September 30, 2014 were as follows (in thousands): | |||||||||||||||||||||||||||||
Less than 12 months of | More than 12 months of | Total temporary | |||||||||||||||||||||||||||
temporary impairment | temporary impairment | impairment | |||||||||||||||||||||||||||
Number of | Estimated | Unrealized | Estimated | Unrealized | Estimated | Unrealized | |||||||||||||||||||||||
Investments | Fair Value | Losses | Fair Value | Losses | Fair Value | Losses | |||||||||||||||||||||||
Corporate debt securities | 178 | $ | 165,321 | $ | (397 | ) | $ | 9,266 | $ | (15 | ) | $ | 174,587 | $ | (412 | ) | |||||||||||||
Debt securities issued by U.S. government agencies | 10 | 56,358 | (167 | ) | - | - | 56,358 | (167 | ) | ||||||||||||||||||||
Debt securities issued by states of the United States and political subdivisions of the states | 19 | 22,661 | (78 | ) | 228 | (47 | ) | 22,889 | (125 | ) | |||||||||||||||||||
Total temporarily impaired securities | 207 | $ | 244,340 | $ | (642 | ) | $ | 9,494 | $ | (62 | ) | $ | 253,834 | $ | (704 | ) | |||||||||||||
We believe that the decline in value of these securities is temporary and primarily related to the change in market interest rates since purchase. We believe it is more likely than not that we will be able to hold these securities to maturity. Therefore we anticipate full recovery of their amortized cost basis at maturity. |
Fair_Value_Measurements
Fair Value Measurements | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Fair Value Measurements [Abstract] | ' | ||||||||||||||||
Fair Value Measurements | ' | ||||||||||||||||
4 | Fair Value Measurements | ||||||||||||||||
We use a three-tier fair value hierarchy to prioritize the inputs used in our fair value measurements. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets for identical assets, which includes our money market funds and treasury securities classified as available-for-sale securities and our investment in equity securities in publicly-held biotechnology companies; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable, which includes our fixed income securities and commercial paper classified as available-for-sale securities; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring us to develop our assumptions. Our Level 3 investments include investments in the equity securities of publically held biotechnology companies for which we calculated a lack of marketability discount because there were restrictions on when we could trade the securities. The majority of our securities have been classified as Level 2. We obtain the fair value of our Level 2 investments from our custodian bank or from a professional pricing service. We validate the fair value of our Level 2 investments by understanding the pricing model used by the custodian banks or professional pricing service provider and comparing that fair value to the fair value based on observable market prices. During the nine months ended September 30, 2014, there were no transfers between our Level 1 and Level 2 investments. We recognize transfers between levels of the fair value hierarchy on the date of the event or change in circumstances that caused the transfer. | |||||||||||||||||
We measure the following major security types at fair value on a recurring basis. The following summary breaks down the fair-value hierarchy that each security is valued with at September 30, 2014 and December 31, 2013 as follows (in thousands): | |||||||||||||||||
At September 30, | Quoted Prices in | Significant Other | Significant | ||||||||||||||
2014 | Active Markets | Observable | Unobservable | ||||||||||||||
(Level 1) | Inputs | Inputs | |||||||||||||||
(Level 2) | (Level 3) | ||||||||||||||||
Cash equivalents | $ | 44,551 | $ | 44,551 | $ | — | $ | — | |||||||||
Corporate debt securities (1) | 353,848 | — | 353,848 | — | |||||||||||||
Debt securities issued by U.S. government agencies (1) | 106,397 | — | 106,397 | — | |||||||||||||
Debt securities issued by the U.S. Treasury | 9,040 | 9,040 | — | — | |||||||||||||
Debt securities issued by states of the United States and political subdivisions of the states (1) | 64,344 | — | 64,344 | — | |||||||||||||
Investment in Regulus Therapeutics Inc. | 47,426 | 47,426 | — | — | |||||||||||||
Equity securities (2) | 1,021 | 1,021 | — | — | |||||||||||||
Total | $ | 626,627 | $ | 102,038 | $ | 524,589 | $ | — | |||||||||
At December 31, | Quoted Prices in | Significant Other | Significant | ||||||||||||||
2013 | Active Markets | Observable | Unobservable | ||||||||||||||
(Level 1) | Inputs | Inputs | |||||||||||||||
(Level 2) | (Level 3) | ||||||||||||||||
Cash equivalents | $ | 133,233 | $ | 133,233 | $ | — | $ | — | |||||||||
Corporate debt securities (1) | 407,897 | — | 407,897 | — | |||||||||||||
Debt securities issued by U.S. government agencies | 64,432 | — | 64,432 | — | |||||||||||||
Debt securities issued by the U.S. Treasury | 15,328 | 15,328 | — | — | |||||||||||||
Debt securities issued by states of the United States and political subdivisions of the states | 22,255 | — | 22,255 | — | |||||||||||||
Investment in Regulus Therapeutics Inc. | 52,096 | 52,096 | — | — | |||||||||||||
Equity securities (2) | 1,276 | 1,276 | — | — | |||||||||||||
Total | $ | 696,517 | $ | 201,933 | $ | 494,584 | $ | — | |||||||||
-1 | Includes investments classified as cash equivalents on our condensed consolidated balance sheet. | ||||||||||||||||
-2 | Included in other current assets on our condensed consolidated balance sheet. | ||||||||||||||||
When we hold investments in publicly-held biotechnology companies that are subject to trading restrictions, we calculate a lack of marketability discount on the fair value of the investments and categorize these investments as Level 3. We determine the lack of marketability discount by using a Black-Scholes model to value a hypothetical put option to approximate the cost of hedging the stock until the restriction ended. | |||||||||||||||||
In the first quarter of 2014, Achaogen completed an initial public offering. As a result, we stopped using the cost method of accounting for our equity investment in Achaogen and instead we began accounting for it at fair value. Until September 2014, the fair value of our investment in Achaogen included a lack of marketability discount because there were restrictions on when we could trade the securities. In September 2014, we reclassified our investment in Achaogen to a Level 1 investment because the contractual trading restrictions on the shares we own had ended. | |||||||||||||||||
The following is a summary of our investments measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the nine months ended September 30, 2014 (in thousands): | |||||||||||||||||
Beginning balance of Level 3 investments | $ | - | |||||||||||||||
Total gain included in accumulated other comprehensive income (loss) | 1,231 | ||||||||||||||||
Transfers out of Level 3 investments | (1,231 | ) | |||||||||||||||
Ending balance of Level 3 investments | $ | - | |||||||||||||||
Other Fair Value Disclosures | |||||||||||||||||
Our 2¾ percent convertible notes had a fair value of $490.0 million at September 30, 2014. We determine the fair value of our 2¾ percent convertible notes based on quoted market prices for these notes, which is a Level 2 measurement. |
Concentration_of_Business_Risk
Concentration of Business Risk | 9 Months Ended | |||||||||||
Sep. 30, 2014 | ||||||||||||
Concentration of Business Risk [Abstract] | ' | |||||||||||
Concentration of Business Risk | ' | |||||||||||
5. Concentration of Business Risk | ||||||||||||
We have historically funded our operations from collaborations with corporate partners and a relatively small number of partners have accounted for a significant percentage of our revenue. Revenue from significant partners, which is defined as ten percent or more of our total revenue, was as follows: | ||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||
September 30, | September 30, | |||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||
Partner A | 72% | 25% | 59% | 16% | ||||||||
Partner B | 12% | 48% | 9% | 22% | ||||||||
Partner C | 1% | 18% | 15% | 21% | ||||||||
Partner D | 0% | 0% | 0% | 31% | ||||||||
Contract receivables from two significant partners comprised approximately 94 percent of our contract receivables at September 30, 2014. Contract receivables from three significant partners comprised approximately 91 percent of our contract receivables at December 31, 2013. |
Income_Taxes
Income Taxes | 9 Months Ended | ||
Sep. 30, 2014 | |||
Income Taxes [Abstract] | ' | ||
Income Taxes | ' | ||
6 | Income Taxes | ||
Intraperiod tax allocation rules require us to allocate our provision for income taxes between continuing operations and other categories of earnings, such as other comprehensive income. In periods in which we have a year-to-date pre-tax loss from continuing operations and pre-tax income in other categories of earnings, such as other comprehensive income, we must allocate the tax provision to the other categories of earnings. We then record a related tax benefit in continuing operations. During the nine months ended September 30, 2013, we recorded unrealized gains on our investments in available-for-sale securities in other comprehensive income, net of taxes. As a result, for the nine months ended September 30, 2013, we recorded a $6.4 million tax benefit, compared to income tax expense of $2,000 for the nine months ended September 30, 2014. | |||
Collaborative_Arrangements_and
Collaborative Arrangements and Licensing Agreements | 9 Months Ended | ||
Sep. 30, 2014 | |||
Collaborative Arrangements and Licensing Agreements [Abstract] | ' | ||
Collaborative Arrangements and Licensing Agreements | ' | ||
7 | Collaborative Arrangements and Licensing Agreements | ||
Traditional Pharmaceutical Alliances and Licensing | |||
AstraZeneca | |||
In December 2012, we entered into a global collaboration agreement with AstraZeneca to discover and develop antisense drugs against five cancer targets. As part of the agreement, we granted AstraZeneca an exclusive license to develop and commercialize ISIS-STAT3Rx and ISIS-ARRx for the treatment of cancer and an option to license up to three cancer drugs under a separate research program. We are eligible to receive milestone payments and license fees from AstraZeneca as programs advance in development. In addition, we are eligible to receive royalties up to the low to mid-teens on any product sales of drugs resulting from this collaboration. Under the terms of the agreement, we received $31 million in upfront and near-term payments comprised of a $25 million upfront payment we received in December 2012 and a $6 million payment we received in June 2013, of which we recognized $11.5 million upon receipt of the payments. We are recognizing the remaining $19.5 million as follows: | |||
| $11.2 million related to the ISIS-ARRx program, which we amortized through March 2014; | ||
| $7.6 million related to the option to license three drugs under a separate research program, which we are amortizing through December 2016; and | ||
| $0.7 million related to the ISIS-STAT3Rx program, which we are amortizing through November 2014. | ||
Together with AstraZeneca, we are evaluating ISIS-STAT3Rx in patients with advanced cancer. AstraZeneca is conducting a Phase 1b/2a clinical study of ISIS-STAT3Rx in patients with advanced metastatic hepatocellular carcinoma, or HCC. We are also conducting a clinical study evaluating ISIS-STAT3Rx in patients with advanced lymphomas, including patients with diffuse large b-cell lymphoma. We are responsible for completing our clinical study in patients with advanced lymphomas and AstraZeneca is responsible for all other development activities for ISIS-STAT3Rx. In October 2014, we and AstraZeneca amended our agreement for ISIS-STAT3Rx. Under the amended terms of the agreement, we earned a $7.5 million milestone payment in November 2014, the first of two milestone payments totaling $15 million, from AstraZeneca for the advancement of ISIS-STAT3Rx in patients with advanced cancers. Upon initiation of the Phase 2 study, we will earn the second $7.5 million milestone payment and an additional $10 million milestone payment. In total, we are eligible to receive up to $70 million in milestone payments as ISIS-STAT3Rx advances through clinical development. In addition, we are eligible to earn up to $170 million in regulatory milestone payments plus royalties on the commercial sales of the drug. | |||
In June 2013, we and AstraZeneca added a second development candidate, ISIS-ARRx, to our collaboration. ISIS-ARRx is an antisense drug we designed to treat patients with prostate cancer by inhibiting the production of the androgen receptor, or AR. From inception through September 2014, we have earned $25 million in milestone payments related to the development of ISIS-ARRx, including a $15 million milestone payment we earned in June 2014 when AstraZeneca initiated a Phase 1 study of ISIS-ARRx. | |||
If AstraZeneca successfully develops ISIS-STAT3Rx, ISIS-ARRx, and three drugs under the research program, we could receive substantive milestone payments of more than $865 million, including up to $238 million for the achievement of development milestones and up to $620 million for the achievement of regulatory milestones. We will earn the next milestone payment of $10 million if we designate a development candidate for a cancer drug under our research program with AstraZeneca. | |||
In August 2013, we added another collaboration program with AstraZeneca to discover and develop an antisense drug against an undisclosed target. AstraZeneca has the option to license a drug resulting from this research collaboration, and if AstraZeneca exercises its option, it will be responsible for all further development and commercialization of the drug. We received a $750,000 upfront payment, which we are amortizing through December 2015. We are eligible to receive license fees and substantive milestone payments of $163.2 million, including up to $45.3 million for the achievement of research and development milestones and up to $105 million for regulatory milestones. We will earn the next $3.3 million milestone payment if AstraZeneca selects a development candidate under this collaboration. In addition, we are eligible to receive royalties up to the low teens on sales from any product that AstraZeneca successfully commercializes under this collaboration program. | |||
Our agreement with AstraZeneca will continue until the expiration of all payment obligations under the agreement. In addition, the agreement, or any program under the agreement, may terminate early under the following situations: | |||
● | AstraZeneca may terminate the agreement or any program at any time by providing written notice to us; | ||
● | AstraZeneca may terminate the agreement or any program by providing written notice if we undergo a change of control with a third party; and | ||
● | Either we or AstraZeneca may terminate the agreement or any program by providing written notice to the other party upon the other party’s uncured failure to perform a material obligation under the agreement, or the entire agreement if the other party becomes insolvent. | ||
During the three and nine months ended September 30, 2014, we earned revenue of $627,000 and $19.7 million, respectively, from our relationship with AstraZeneca which represented one percent and 15 percent, respectively, of our total revenue for those periods. In comparison, we earned revenue of $4.2 million and $22.0 million for the same periods in 2013. Our balance sheet at September 30, 2014 included deferred revenue of $4.8 million related to our relationship with AstraZeneca. | |||
Biogen Idec | |||
We have established four strategic collaborations with Biogen Idec that broaden and expand our severe and rare disease franchise for neurological disorders. | |||
ISIS-SMNRx | |||
In January 2012, we entered into a global collaboration agreement with Biogen Idec to develop and commercialize ISIS-SMNRx for the treatment of SMA. We received an upfront payment of $29 million, which we are amortizing through February 2017. We are eligible to receive a license fee, milestone payments and royalties up to the mid-teens on any product sales of ISIS-SMNRx. Biogen Idec has the option to license ISIS-SMNRx until completion of the first successful Phase 2/3 study or the completion of two Phase 2/3 studies. If Biogen Idec exercises its option, it will pay us a license fee and will assume global development, regulatory and commercialization responsibilities. In 2014, we and Biogen Idec amended our original agreement to reflect changes made to the clinical development plan for ISIS-SMNRx. As a result, we and Biogen Idec agreed to increase the payments that we are eligible to receive under this collaboration by approximately $57 million. | |||
In the third quarter of 2014, we initiated the Phase 3 study evaluating ISIS-SMNRx in infants with SMA, for which we earned an $18 million milestone payment when we dosed the first patient. In addition, we are evaluating ISIS-SMNRx in a Phase 2 open-label, multiple-dose, dose-escalation study in children with SMA and a Phase 2 open-label, multiple-dose, dose-escalation pilot study in infants with SMA. From inception through September 2014, we have earned $37.3 million in payments for advancing ISIS-SMNRx, including $11.3 million in payments we earned related to the amendments made to the clinical development plan for ISIS-SMNRx. Accounting rules require us to amortize the $11.3 million we received related to the amendments of the clinical development plan for ISIS-SMNRx over our estimated period of performance, which is as follows: | |||
● | $3.8 million related to the Phase 2 studies in children and infants with SMA, which we amortized through July 2014; and | ||
● | $7.5 million related to an open-label extension study in children with SMA, which we are amortizing through December 2014. | ||
Under the terms of the amended agreement, we are eligible to receive up to $327.2 million in a license fee and payments, including $102.2 million in substantive milestone and other payments associated with the clinical development of ISIS-SMNRx prior to licensing and $150 million in substantive milestone payments if Biogen Idec achieves pre-specified regulatory milestones. We will earn the next milestone payment of $27 million if we dose the first patient in the Phase 3 study of ISIS-SMNRx in children with SMA, which is designed to support marketing registration for ISIS-SMNRx in the United States and Europe. | |||
ISIS-DMPKRx | |||
In June 2012, we and Biogen Idec entered into a second and separate collaboration and license agreement to develop and commercialize a novel antisense drug targeting DMPK for the treatment of myotonic dystrophy type 1, or DM1, ISIS-DMPKRx. We are responsible for global development of the drug through the completion of the first Phase 2 clinical trial. Biogen Idec has the option to license the drug through the completion of the first Phase 2 trial. Under the terms of the agreement, we received an upfront payment of $12 million, which we are amortizing through June 2017. Over the term of the collaboration, we are eligible to receive up to $259 million in a license fee and substantive milestone payments. From inception through September 2014, we have earned $24 million in substantive milestone payments associated with the clinical development of ISIS-DMPKRx, including a $14 million milestone payment we earned in June 2014 when we initiated a Phase 1 study for ISIS-DMPKRx. We are eligible to receive up to another $35 million in milestone payments associated with the development of ISIS-DMPKRx prior to licensing. We are also eligible to receive up to $130 million in milestone payments if Biogen Idec achieves pre-specified regulatory milestones. In addition, we are eligible to receive royalties up to the mid-teens on any product sales of the drug. We will earn the next milestone payment of $35 million if we initiate a Phase 2 study for ISIS-DMPKRx. | |||
Neurology | |||
In December 2012, we and Biogen Idec entered into a third and separate collaboration to develop and commercialize novel antisense drugs to three targets to treat neurological or neuromuscular diseases. We are responsible for the development of each of the drugs through the completion of the initial Phase 2 clinical study for such drug. Biogen Idec has the option to license a drug from each of the three programs through the completion of the first Phase 2 study for each program. Under the terms of the agreement, we received an upfront payment of $30 million, which we are amortizing through December 2020. Over the term of the collaboration, we are eligible to receive up to $259 million in a license fee and substantive milestone payments per program. We could receive up to $59 million in development milestone payments to support research and development of each program, including amounts related to the cost of clinical trials. We could also receive up to $130 million in milestone payments per program if Biogen Idec achieves pre-specified regulatory milestones. In addition, we are eligible to receive royalties up to the mid-teens on any product sales of drugs resulting from each of the three programs. We will earn the next milestone payment of $10 million if we initiate an IND-enabling toxicology study for a development candidate identified under this collaboration. | |||
Strategic Neurology | |||
In September 2013, we and Biogen Idec entered into a fourth and separate collaboration, which is a long-term strategic relationship focused on applying antisense technology to advance the treatment of neurological diseases. As part of the collaboration, Biogen Idec gained exclusive rights to the use of our antisense technology to develop therapies for neurological diseases and has the option to license drugs resulting from this collaboration. The exclusivity for neurological diseases will last six years, and may be extended for any drug development programs being pursued under the collaboration. Under the terms of the agreement, we received an upfront payment of $100 million and are eligible to receive milestone payments, license fees and royalty payments for all drugs developed through this collaboration, with the specific amounts dependent upon the modality of the molecule advanced by Biogen Idec. If we have a change of control during the first six years of the collaboration, we may be required to refund Biogen Idec a portion of the $100 million upfront payment, with the amount of the potential refund decreasing ratably as we progress through the initial six year term of the collaboration. We are amortizing the $100 million upfront payment through September 2019. Because the amortization period for the upfront payment will never be less than the initial six year term of the collaboration, the amount of revenue we recognize from the upfront payment will never exceed the amount that Biogen Idec could potentially require us to refund. | |||
For each antisense molecule that is chosen for drug discovery and development under this collaboration, we are eligible to receive up to approximately $260 million in a license fee and substantive milestone payments. We are eligible to receive up to approximately $60 million for the achievement of research and development milestones, including amounts related to the cost of clinical trials, and up to $130 million for the achievement of regulatory milestones. We will usually be responsible for drug discovery and early development of antisense drugs and Biogen Idec will have the option to license antisense drugs after Phase 2 proof of concept. Biogen Idec will then be responsible for later phase development and commercialization of the licensed drug. In addition, we are eligible to receive royalties up to the mid-teens on any product sales of antisense drugs developed under this collaboration. If other modalities, such as small molecules or monoclonal antibodies, are chosen, we are eligible to receive up to $90 million in substantive milestone payments, including up to $35 million for the achievement of research and development milestones and up to $55 million for the achievement of regulatory milestones. Biogen Idec will be responsible for all of the drug discovery and development activities for drugs using other modalities. In addition, we are eligible to receive single-digit royalties on any product sales of drugs using non-antisense modalities developed under this collaboration. In June 2014, we earned a $10 million milestone payment when Biogen Idec chose the first target to advance under this collaboration and in November 2014 we earned an additional $10 million milestone payment when we initiated an IND-enabling toxicology study for another target under this collaboration. We will earn the next milestone payment of up to $10 million if we choose another target to advance under this collaboration. | |||
Each of our agreements with Biogen Idec will continue until the earlier of the date all of Biogen Idec’s options to obtain the exclusive licenses under the applicable agreement expire unexercised or, if Biogen Idec exercises its option, until the expiration of all payment obligations under the applicable agreement. In addition, each agreement, or any program under an agreement, may terminate early under the following situations: | |||
● | Biogen Idec may terminate the agreement or any program at any time by providing written notice to us; | ||
● | Under specific circumstances, if we are acquired by a third party with a product that directly competes with a compound being developed under the agreement, Biogen Idec may terminate the affected program by providing written notice to us; | ||
● | If, within a specified period of time, any required clearance of a transaction contemplated by an agreement under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, is not received, then either we or Biogen Idec may terminate the affected program by providing written notice to the other party; and | ||
● | Either we or Biogen Idec may terminate any program by providing written notice to the other party upon the other party’s uncured failure to perform a material obligation under the agreement with respect to the affected program, or the entire agreement if the other party becomes insolvent. | ||
During the three and nine months ended September 30, 2014, we earned revenue of $31.7 million and $76.4 million, respectively, from our relationship with Biogen Idec, which represented 72 percent and 59 percent of our total revenue for those periods. In comparison, we earned revenue of $5.9 million and $17.1 million for the same periods in 2013. Our balance sheet at September 30, 2014 included deferred revenue of $127.4 million related to our relationship with Biogen Idec. | |||
GSK | |||
In March 2010, we entered into a strategic alliance with GSK, for up to six programs, using our antisense drug discovery platform to seek out and develop new drugs against targets for rare and serious diseases, including infectious diseases and some conditions causing blindness. This alliance allows us to control and facilitate development of drugs while still being eligible to receive milestone payments as we advance these drugs in clinical development. Our strategic alliance currently includes five active programs. Under the terms of the agreement, we received a $35 million upfront payment and in May 2011 we received a $3 million payment when GSK expanded the collaboration. In addition, we are eligible to receive on average up to $20 million in milestone payments through Phase 2 proof-of-concept for each program, except for ISIS-TTRRx and the fifth target, which we describe below. GSK has the exclusive option to license drugs resulting from this alliance at Phase 2 proof-of-concept for a license fee. If GSK exercises its exclusive option for any drugs resulting from this alliance, it will be responsible for all further global development, regulatory and commercialization activities for such drug. | |||
In October 2012, we and GSK amended the original agreement to reflect an accelerated clinical development plan for ISIS-TTRRx. Under the amended terms of the agreement, we received a $2.5 million upfront payment in December 2012. From inception through September 2014, we have received $27 million, primarily in milestone payments, from GSK related to the development of ISIS-TTRRx, not including an $18 million milestone payment we earned in October 2014 related to the advancement of the Phase 2/3 study of ISIS-TTRRx in patients with familial amyloid polyneuropathy. We are also eligible to earn an additional $25 million in pre-licensing milestone payments associated with the ISIS-TTRRx Phase 2/3 study. In addition, under the amended agreement, we and GSK increased the regulatory and commercial milestone payments we can earn should ISIS-TTRRx receive marketing approval and meet pre-agreed sales targets. | |||
In September 2013, we designated ISIS-HBVRx, formerly ISIS-GSK3Rx, as a development candidate under our collaboration with GSK. ISIS-HBVRx is an antisense drug designed to reduce the production of viral proteins associated with hepatitis B virus, or HBV, infection and replication. In June 2014, we amended our agreement to modify the development plans for ISIS-HBVRx. As a result, we received a $1 million payment. From inception through September 2014, we have earned $10 million in substantive milestone payments associated with advancing the ISIS-HBVRx program. | |||
From inception through September 2014, we have earned $6.5 million in milestone payments for advancing ISIS-GSK4Rx, including a $1.5 million milestone payment we earned in September 2014 when we initiated an IND-enabling toxicology study of ISIS-GSK4Rx. In addition, in November 2014, we earned a $5 million milestone payment when we designated ISIS-GSK5Rx as a development candidate. ISIS-GSK4Rx and ISIS-GSK5Rx are antisense drugs we designed to treat undisclosed ocular diseases. We and GSK amended our agreement to modify the development plans for ISIS-GSK4Rx and ISIS-GSK5Rx in April 2014. From inception through November 2014, we have earned $11.5 million in milestone payments associated with advancing ISIS-GSK4Rx and ISIS-GSK5Rx. | |||
Under our agreement, if GSK successfully develops all five programs for one or more indications and achieves pre-agreed sales targets, we could receive license fees and substantive milestone payments of more than $1.2 billion, including up to $147.5 million for the achievement of development milestones, up to $483.5 million for the achievement of regulatory milestones and up to $428 million for the achievement of commercialization milestones. We will earn the next $1.0 million milestone payment if we further advance the ISIS-HBVRx program. In addition, we are eligible to receive royalties up to the mid-teens on sales from any product that GSK successfully commercializes under this alliance. | |||
Our alliance with GSK will continue until the earlier of the date all of GSK’s options to obtain the exclusive licenses under the agreement expire unexercised or, if GSK exercises its option, until the expiration of all payment obligations under the agreement. In addition, the agreement, or any program under the agreement, may terminate early under the following situations: | |||
● | GSK may terminate any program other than the ISIS-TTRRx program at any time by providing written notice to us; | ||
● | GSK may terminate the ISIS-TTRRx program by providing written notice to us after reviewing specific data from the Phase 3 study for the program; and | ||
● | Either we or GSK may terminate any program by providing written notice to the other party upon the other party’s uncured failure to perform a material obligation under the agreement with respect to the affected program, or the entire agreement if the other party becomes insolvent. | ||
During the three and nine months ended September 30, 2014, we earned revenue of $5.1 million and $11.9 million, respectively, from our relationship with GSK, which represented 12 percent and nine percent, respectively, of our total revenue for those periods. In comparison, we earned revenue of $11.3 million and $23.5 million for the same periods in 2013. Our balance sheet at September 30, 2014 included deferred revenue of $11.1 million related to our relationship with GSK, $9 million of which is related to the upfront and other payments associated with our collaboration with GSK that we are amortizing through our estimated period of performance of September 2015. | |||
Roche | |||
In April 2013, we formed an alliance with Hoffman-La Roche Inc. and F. Hoffmann-La Roche Ltd., collectively Roche, to develop treatments for Huntington’s disease based on our antisense technology. Roche has the option to license the drugs from us through the completion of the first Phase 1 trial. Prior to option exercise, we are responsible for the discovery and development of an antisense drug targeting huntingtin, or HTT, protein. We are also working collaboratively with Roche on the discovery of an antisense drug utilizing Roche’s “brain shuttle” program. If Roche exercises its option, it will be responsible for global development, regulatory and commercialization activities for any drug arising out of the collaboration. Under the terms of the agreement, we received an upfront payment of $30 million in April 2013, which we are amortizing through April 2017. We are eligible to receive up to $362 million in a license fee and substantive milestone payments including up to $67 million for the achievement of development milestones, up to $170 million for the achievement of regulatory milestones and up to $80 million for the achievement of commercialization milestones. In addition, we are eligible to receive up to $136.5 million in milestone payments for each additional drug successfully developed and up to $50 million in commercial milestones if a drug using Roche’s proprietary brain shuttle technology is successfully commercialized. We are also eligible to receive tiered royalties up to the mid-teens on any product sales of drugs resulting from this alliance. We will earn the next milestone payment of $22 million if we initiate a Phase 1 trial for a drug targeting HTT protein. | |||
Our alliance with Roche will continue until the earlier of the date Roche’s option to obtain the exclusive license under the agreement expires unexercised or, if Roche exercises its option, until the expiration of all payment obligations under the agreement. In addition, the agreement may terminate early under the following situations: | |||
● | Roche may terminate the agreement at any time by providing written notice to us; | ||
● | Either we or Roche may terminate the agreement by providing written notice to the other party upon the other party’s uncured failure to perform a material obligation under the agreement or if the other party becomes insolvent; and | ||
● | Either we or Roche may terminate the brain shuttle program if at least one development candidate is not designated under such program by a mutually agreed deadline. | ||
During the three and nine months ended September 30, 2014, we earned revenue of $2.3 million and $6.7 million, respectively, from our relationship with Roche. In comparison, we earned revenue of $1.9 million and $3.2 million for the three and nine months ended September 30, 2013, respectively. Our balance sheet at September 30, 2014 included deferred revenue of $19.0 million related to our relationship with Roche. | |||
Satellite Company Collaborations | |||
Achaogen, Inc. | |||
In 2006, we exclusively outlicensed to Achaogen, Inc. specific know-how, patents and patent applications relating to aminoglycosides. In exchange, Achaogen agreed to certain payment obligations related to aminoglycosides Achaogen developed. Aminoglycosides are a class of small molecule antibiotics that inhibit bacterial protein synthesis and that physicians use to treat serious bacterial infections. Achaogen is developing plazomicin, an aminoglycoside Achaogen discovered based on the technology we licensed to Achaogen. Plazomicin has displayed broad-spectrum activity in animals against multi-drug resistant gram-negative bacteria that cause systemic infections, including E. coli. The compound has also demonstrated activity against methicillin-resistant staphylococcus aureus, or MRSA. | |||
In connection with the license, Achaogen issued to us $1.5 million of Achaogen Series A Preferred Stock. Since early 2009, we have earned $7 million in milestone payments from Achaogen, including $4 million we earned in September 2014 when Achaogen initiated a Phase 3 study of plazomicin in patients with serious multi-drug resistant, gram-negative bacterial infections. Assuming Achaogen successfully develops and commercializes two drugs under our agreement, we will receive payments totaling up to $42.3 million for the achievement of key clinical, regulatory and sales events. We will earn the next payment of $7.5 million if Achaogen obtains regulatory approval for plazomicin in a major market. We are also eligible to receive royalties on sales of drugs resulting from the program. Achaogen is solely responsible for the continued development of plazomicin. | |||
In March 2014, Achaogen completed an initial public offering. Upon the close of the offering, our investment in Achaogen’s preferred stock converted into approximately 148,000 shares of common stock. As of September 30, 2014, the fair value of our investment in Achaogen was $1.0 million. At September 30, 2014 and December 31, 2013, we owned less than 10 percent of Achaogen’s equity. | |||
Alnylam Pharmaceuticals, Inc. | |||
In March 2004, we entered into a strategic alliance with Alnylam to develop and commercialize RNA interference therapeutics. Under the terms of the agreement, we exclusively licensed to Alnylam our patent estate relating to antisense motifs and mechanisms and oligonucleotide chemistry for double-stranded RNAi therapeutics in exchange for a $5 million technology access fee, participation in fees from Alnylam’s partnering programs, as well as future milestone and royalty payments from Alnylam. In August 2012, we expanded the license to include using the double-stranded RNAi technology for agricultural products. For each drug Alnylam develops under this alliance, we may receive up to $3.4 million in substantive milestone payments, including up to $1.1 million for the achievement of development milestones and $2.3 million for regulatory milestones. In 2013, we earned a $750,000 milestone payment when Alnylam initiated a Phase 3 study for a drug targeting transthyretin amyloidosis, or TTR. We will earn the next milestone payment of $375,000 if Alnylam initiates a Phase 1 study for a drug in Alnylam’s pipeline. We retained rights to a limited number of double-stranded RNAi therapeutic targets and all rights to single-stranded RNAi, or ssRNAi, therapeutics. | |||
In turn, Alnylam nonexclusively licensed to us its patent estate relating to antisense motifs and mechanisms and oligonucleotide chemistry to research, develop and commercialize ssRNAi therapeutics and to research double-stranded RNAi compounds. We also received a license to develop and commercialize double-stranded RNAi drugs targeting a limited number of therapeutic targets on a nonexclusive basis. If we develop or commercialize an RNAi-based drug using Alnylam’s technology, we will pay Alnylam milestone payments and royalties. For each drug, the potential milestone payments to Alnylam total $3.4 million, which we will pay if we achieve specified development and regulatory events. To date, we do not have an RNAi-based drug in clinical development. Our Alnylam alliance provides us with an opportunity to realize substantial value from our pioneering work in antisense mechanisms and oligonucleotide chemistry and is an example of our strategy to participate in all areas of RNA-targeting drug discovery. | |||
We have the potential to earn sublicense revenue and a portion of milestone payments and royalty payments that Alnylam receives from licenses of our technology it grants to its partners. Through September 2014, we have earned a total of $48.2 million from Alnylam resulting from licenses of our technology for the development of RNAi technology that we granted to Alnylam and Alnylam has granted to its partners, including $7.7 million we earned in the first quarter of 2014 related to Alnylam’s collaboration with Genzyme. During the nine months ended September 30, 2014 and 2013, we earned revenue of $7.7 million and $0.4 million, respectively, from our relationship with Alnylam. |
Subsequent_Events
Subsequent Events | 9 Months Ended | ||
Sep. 30, 2014 | |||
Subsequent Events | ' | ||
Subsequent Events | ' | ||
8 | Subsequent Event | ||
In November 2014, Regulus completed a public offering. As part of the offering, we sold 1,279,411 shares of Regulus’ common stock for total proceeds of $20.4 million, resulting in a $17.8 million gain, which we will recognize in the fourth quarter of 2014. As part of the public offering, Regulus' directors, executive management team, and some of its stockholders, including us, have agreed that until January 27, 2015, subject to specified exceptions, not to offer, sell, contract to sell, pledge or otherwise dispose of, directly or indirectly, any shares of Regulus' common stock or securities convertible into or exchangeable or exercisable for any shares of Regulus' common stock. | |||
Significant_Accounting_Policie1
Significant Accounting Policies (Policies) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Significant Accounting Policies [Abstract] | ' | ||||||||||||||||
Revenue Recognition | ' | ||||||||||||||||
Revenue Recognition | |||||||||||||||||
We generally recognize revenue when we have satisfied all contractual obligations and are reasonably assured of collecting the resulting receivable. We are often entitled to bill our customers and receive payment from our customers in advance of recognizing the revenue. In the instances in which we have received payment from our customers in advance of recognizing revenue, we include the amounts in deferred revenue on our condensed consolidated balance sheet. | |||||||||||||||||
Research and development revenue under collaborative agreements | |||||||||||||||||
Our collaboration agreements typically contain multiple elements, or deliverables, including technology licenses or options to obtain technology licenses, research and development services, and in certain cases manufacturing services. Our collaborations may provide for various types of payments to us including upfront payments, funding of research and development, milestone payments, licensing fees, profit sharing and royalties on product sales. We evaluate the deliverables in our collaboration agreements to determine whether they meet the criteria to be accounted for as separate units of accounting or whether they should be combined with other deliverables and accounted for as a single unit of accounting. When the delivered items in an arrangement have “stand-alone value” to our customer, we account for the deliverables as separate units of accounting and we allocate the consideration to each unit of accounting based on the relative selling price of each deliverable. Delivered items have stand-alone value if they are sold separately by any vendor or the customer could resell the delivered items on a stand-alone basis. We use the following hierarchy of values to estimate the selling price of each deliverable: (i) vendor-specific objective evidence of fair value; (ii) third-party evidence of selling price; and (iii) best estimate of selling price, or BESP. The BESP reflects our best estimate of what the selling price would be if we regularly sold the deliverable on a stand-alone basis. We recognize the revenue allocated to each unit of accounting as we deliver the related goods or services. If we determine that we should treat certain deliverables as a single unit of accounting, then we recognize the revenue ratably over our estimated period of performance. | |||||||||||||||||
In December 2012, we entered into a collaboration agreement with AstraZeneca to discover and develop antisense therapeutics against five cancer targets. As part of the collaboration, we received a $25 million upfront payment in December 2012 and a $6 million payment in June 2013 when AstraZeneca elected to continue the research collaboration. We are also eligible to receive milestone payments, license fees for the research program targets and royalties on any product sales of drugs resulting from this collaboration. In exchange, we granted AstraZeneca an exclusive license to develop and commercialize ISIS-STAT3Rx and ISIS-ARRx. We also granted AstraZeneca options to license up to three cancer drugs under the separate research program. We were responsible for completing IND-enabling studies for ISIS-ARRx, which we completed earlier this year. We are also responsible for completing an ongoing clinical study of ISIS-STAT3Rx. AstraZeneca is responsible for all other global development, regulatory and commercialization activities for ISIS-STAT3Rx and ISIS-ARRx. In addition, if AstraZeneca exercises its option for any drugs resulting from the research program, AstraZeneca will assume global development, regulatory and commercialization responsibilities for such drug. Since this agreement has multiple elements, we evaluated the deliverables in this arrangement when we entered into the agreement and determined that certain deliverables, either individually or in combination, have stand-alone value. Below is a list of the four separate units of accounting under our agreement: | |||||||||||||||||
● | The exclusive license we granted to AstraZeneca to develop and commercialize ISIS-STAT3Rx for the treatment of cancer; | ||||||||||||||||
● | The development services we are performing for ISIS-STAT3Rx; | ||||||||||||||||
● | The exclusive license we granted to AstraZeneca to develop and commercialize ISIS-ARRx and the research services we performed for ISIS-ARRx; and | ||||||||||||||||
● | The option to license up to three drugs under a research program and the research services we will perform for this program. | ||||||||||||||||
We determined that the ISIS-STAT3Rx license had stand-alone value because it is an exclusive license that gives AstraZeneca the right to develop ISIS-STAT3Rx or to sublicense its rights. In addition, ISIS-STAT3Rx is currently in development and it is possible that AstraZeneca or another third party could conduct clinical trials without assistance from us. As a result, we considered the ISIS-STAT3Rx license and the development services for ISIS-STAT3Rx to be separate units of accounting. We recognized the portion of the consideration allocated to the ISIS-STAT3Rx license immediately because we delivered the license and earned the revenue. We are recognizing as revenue the amount allocated to the development services for ISIS-STAT3Rx over the period of time we perform services. The ISIS-ARRx license is also an exclusive license. At the inception of the agreement, ISIS-ARRx was in an early stage of research. Therefore, we concluded that our knowledge and expertise with antisense technology was essential for AstraZeneca or another third party to successfully develop ISIS-ARRx. As a result, we determined that the ISIS-ARRx license did not have stand-alone value and we combined the ISIS-ARRx license and related research services into one unit of accounting. We recognized revenue for the combined unit of accounting over the period of time we performed services, which ended in the first quarter of 2014. We determined that the options under the research program did not have stand-alone value because AstraZeneca cannot develop or commercialize drugs resulting from the research program until AstraZeneca exercises the respective option or options. As a result, we considered the research options and the related research services as a combined unit of accounting. We are recognizing revenue for the combined unit of accounting over the period of our performance. | |||||||||||||||||
We determined that the initial allocable arrangement consideration was the $25 million upfront payment because it was the only payment that was fixed and determinable when we entered into the agreement. In June 2013, we increased the allocable consideration to $31 million when we received the $6 million payment. There was considerable uncertainty at the date of the agreement as to whether we would earn the milestone payments, royalty payments, payments for manufacturing clinical trial materials or payments for finished drug product. As such, we did not include those payments in the allocable consideration. | |||||||||||||||||
We allocated the allocable consideration based on the relative BESP of each unit of accounting. We engaged a third party, independent valuation expert to assist us with determining BESP. We estimated the selling price of the licenses granted for ISIS-STAT3Rx and ISIS-ARRx by using the relief from royalty method. Under this method, we estimated the amount of income, net of taxes, for each drug. We then discounted the projected income for each license to present value. The significant inputs we used to determine the projected income of the licenses included: | |||||||||||||||||
● | Estimated future product sales; | ||||||||||||||||
● | Estimated royalties on future product sales; | ||||||||||||||||
● | Contractual milestone payments; | ||||||||||||||||
● | Expenses we expect to incur; | ||||||||||||||||
● | Income taxes; and | ||||||||||||||||
● | An appropriate discount rate. | ||||||||||||||||
We estimated the selling price of the research and development services by using our internal estimates of the cost to perform the specific services, marked up to include a reasonable profit margin, and estimates of expected cash outflows to third parties for services and supplies over the expected period that we will perform research and development. The significant inputs we used to determine the selling price of the research and development services included: | |||||||||||||||||
● | The number of internal hours we will spend performing these services; | ||||||||||||||||
● | The estimated number and cost of studies we will perform; | ||||||||||||||||
● | The estimated number and cost of studies that we will contract with third parties to perform; and | ||||||||||||||||
● | The estimated cost of drug product we will use in the studies. | ||||||||||||||||
As a result of the allocation, we recognized $9.3 million of the $25 million upfront payment for the ISIS-STAT3Rx license in December 2012 and we recognized $2.2 million of the $6 million payment for the ISIS-STAT3Rx license in June 2013. We are recognizing the remaining $19.5 million of the $31 million over the estimated period of our performance. Assuming a constant selling price for the other elements in the arrangement, if there was an assumed ten percent increase or decrease in the estimated selling price of the ISIS-STAT3Rx license, we determined that the revenue we would have allocated to the ISIS-STAT3Rx license would change by approximately seven percent, or $750,000, from the amount we recorded. | |||||||||||||||||
Typically, we must estimate our period of performance when the agreements we enter into do not clearly define such information. Our collaborative agreements typically include a research and/or development project plan outlining the activities the agreement requires each party to perform during the collaboration. We estimate the period of time over which we will complete the activities for which we are responsible and use that period of time as our period of performance for purposes of revenue recognition and amortize revenue over such period. We have made estimates of our continuing obligations under numerous agreements and in certain instances the timing of satisfying these obligations may change as the development plans for our drugs progress. Accordingly, our estimates may change in the future. If our estimates and judgments change over the course of these agreements, it may affect the timing and amount of revenue that we recognize in future periods. For example, we adjusted the period of performance on our collaboration with GSK and our ISIS-SMNRx collaboration with Biogen Idec. As a result of adding two new development candidates, ISIS-HBVRx and ISIS-GSK4Rx, to our collaboration with GSK, our period of performance was extended beyond our initial estimate. Therefore, we extended the amortization period to correspond to the new extended period of performance. Similarly, with our ISIS-SMNRx collaboration, we extended the amortization period to correspond to the expansion of the Phase 3 study in infants with Spinal Muscular Atrophy, or SMA. Since we extended the amortization period for our GSK collaboration and our ISIS-SMNRx collaboration, revenue from the amortization of upfront payments for these collaborations will be $3.7 million less in 2014 compared to 2013. | |||||||||||||||||
From time to time, we may enter into separate agreements at or near the same time with the same customer. We evaluate such agreements to determine whether they should be accounted for individually as distinct arrangements or whether the separate agreements are, in substance, a single multiple element arrangement. We evaluate whether the negotiations are conducted jointly as part of a single negotiation, whether the deliverables are interrelated or interdependent, whether fees in one arrangement are tied to performance in another arrangement, and whether elements in one arrangement are essential to another arrangement. Our evaluation involves significant judgment to determine whether a group of agreements might be so closely related that they are, in effect, part of a single arrangement. For example, since early 2012 we have entered into four collaboration agreements with Biogen Idec: | |||||||||||||||||
● | In January 2012, we entered into a collaboration agreement with Biogen Idec to develop and commercialize ISIS-SMNRx for SMA. As part of the collaboration, we received a $29 million upfront payment and we are responsible for global development of ISIS-SMNRx through completion of Phase 2/3 clinical trials. | ||||||||||||||||
● | In June 2012, we entered into a second and separate collaboration agreement with Biogen Idec to develop and commercialize a novel antisense drug targeting DMPK, or dystrophia myotonica-protein kinase. As part of the collaboration, we received a $12 million upfront payment and we are responsible for global development of the drug through the completion of a Phase 2 clinical trial. | ||||||||||||||||
● | In December 2012, we entered into a third and separate collaboration agreement with Biogen Idec to discover and develop antisense drugs against three targets to treat neurological or neuromuscular disorders. As part of the collaboration, we received a $30 million upfront payment and we are responsible for the discovery of a lead antisense drug for each of three targets. | ||||||||||||||||
● | In September 2013, we entered into a fourth and separate collaboration agreement with Biogen Idec to leverage antisense technology to advance the treatment of neurological diseases. We granted Biogen Idec exclusive rights to the use of our antisense technology to develop therapies for neurological diseases as part of this broad collaboration. We received a $100 million upfront payment and we are responsible for discovery and early development through the completion of a Phase 2 clinical trial for each antisense drug identified during the six year term of this collaboration, while Biogen Idec is responsible for the creation and development of small molecule treatments and biologics. | ||||||||||||||||
All four of these collaboration agreements give Biogen Idec the option or options to license one or more drugs resulting from the specific collaboration. If Biogen Idec exercises an option, it will pay us a license fee and will assume future development, regulatory and commercialization responsibilities for the licensed drug. We are also eligible to receive milestone payments associated with the research and/or development of the drugs prior to licensing, milestone payments if Biogen Idec achieves pre-specified regulatory milestones, and royalties on any product sales of drugs resulting from these collaborations. | |||||||||||||||||
We evaluated all four of the Biogen Idec agreements to determine whether we should account for them as separate agreements. We determined that we should account for the agreements separately because we conducted the negotiations independently of one another, each agreement focuses on different drugs, there are no interrelated or interdependent deliverables, there are no provisions in any of these agreements that are essential to the other agreement, and the payment terms and fees under each agreement are independent of each other. We also evaluated the deliverables in each of these agreements to determine whether they met the criteria to be accounted for as separate units of accounting or whether they should be combined with other deliverables and accounted for as a single unit of accounting. For all four of these agreements, we determined that the options did not have stand-alone value because Biogen Idec cannot pursue the development or commercialization of the drugs resulting from these collaborations until it exercises the respective option or options. As such, for each agreement we considered the deliverables to be a single unit of accounting and we are recognizing the upfront payment for each of the agreements over the respective estimated period of our performance. | |||||||||||||||||
Our collaborations often include contractual milestones, which typically relate to the achievement of pre-specified development, regulatory and commercialization events. These three categories of milestone events reflect the three stages of the life-cycle of our drugs, which we describe in more detail in the following paragraph. | |||||||||||||||||
Prior to the first stage in the life-cycle of our drugs, we perform a significant amount of work using our proprietary antisense technology to design chemical compounds that interact with specific genes that are good targets for drug discovery. From these research efforts, we hope to identify a development candidate. The designation of a development candidate is the first stage in the life-cycle of our drugs. A development candidate is a chemical compound that has demonstrated the necessary safety and efficacy in preclinical animal studies to warrant further study in humans. During the first step of the development stage, we or our partners study our drugs in IND-enabling studies, which are animal studies intended to support an Investigational New Drug, or IND, application and/or the foreign equivalent. An approved IND allows us or our partners to study our development candidate in humans. If the regulatory agency approves the IND, we or our partners initiate Phase 1 clinical trials in which we typically enroll a small number of healthy volunteers to ensure the development candidate is safe for use in patients. If we or our partners determine that a development candidate is safe based on the Phase 1 data, we or our partners initiate Phase 2 studies that are generally larger scale studies in patients with the primary intent of determining the efficacy of the development candidate. The final step in the development stage is Phase 3 studies to gather the necessary safety and efficacy data to request marketing approval from the Food and Drug Administration, or FDA, and/or foreign equivalents. The Phase 3 studies typically involve large numbers of patients and can take up to several years to complete. If the data gathered during the trials demonstrates acceptable safety and efficacy results, we or our partner will submit an application to the FDA and/or its foreign equivalents for marketing approval. This stage of the drug’s life-cycle is the regulatory stage. If a drug achieves marketing approval, it moves into the commercialization stage, during which our partner will market and sell the drug to patients. Although our partner will ultimately be responsible for marketing and selling the partnered drug, our efforts to discover and develop a drug that is safe, effective and reliable contributes significantly to our partner’s ability to successfully sell the drug. The FDA and its foreign equivalents have the authority to impose significant restrictions on an approved drug through the product label and on advertising, promotional and distribution activities. Therefore, our efforts designing and executing the necessary animal and human studies are critical to obtaining claims in the product label from the regulatory agencies that would allow our partner to successfully commercialize our drug. Further, the patent protection afforded our drugs as a result of our initial patent applications and related prosecution activities in the United States and foreign jurisdictions are critical to our partner’s ability to sell our drugs without competition from generic drugs. The potential sales volume of an approved drug is dependent on several factors including the size of the patient population, market penetration of the drug, and the price charged for the drug. | |||||||||||||||||
Generally, the milestone events contained in our partnership agreements coincide with the progression of our drugs from development, to regulatory approval and then to commercialization. The process of successfully discovering a new development candidate, having it approved and ultimately sold for a profit is highly uncertain. As such, the milestone payments we may earn from our partners involve a significant degree of risk to achieve. Therefore, as a drug progresses through the stages of its life-cycle, the value of the drug generally increases. | |||||||||||||||||
Development milestones in our partnerships may include the following types of events: | |||||||||||||||||
● | Designation of a development candidate. Following the designation of a development candidate, IND-enabling animal studies for a new development candidate generally take 12 to 18 months to complete; | ||||||||||||||||
● | Initiation of a Phase 1 clinical trial. Generally, Phase 1 clinical trials take one to two years to complete; | ||||||||||||||||
● | Initiation or completion of a Phase 2 clinical trial. Generally, Phase 2 clinical trials take one to three years to complete; | ||||||||||||||||
● | Initiation or completion of a Phase 3 clinical trial. Generally, Phase 3 clinical trials take two to four years to complete. | ||||||||||||||||
Regulatory milestones in our partnerships may include the following types of events: | |||||||||||||||||
● | Filing of regulatory applications for marketing approval such as a New Drug Application, or NDA, in the United States or a Marketing Authorization Application, or MAA, in Europe. Generally, it takes six to twelve months to prepare and submit regulatory filings. | ||||||||||||||||
● | Marketing approval in a major market, such as the United States, Europe or Japan. Generally it takes one to two years after an application is submitted to obtain approval from the applicable regulatory agency. | ||||||||||||||||
Commercialization milestones in our partnerships may include the following types of events | |||||||||||||||||
● | First commercial sale in a particular market, such as in the United States or Europe. | ||||||||||||||||
● | Product sales in excess of a pre-specified threshold, such as annual sales exceeding $1 billion. The amount of time to achieve this type of milestone depends on several factors including but not limited to the dollar amount of the threshold, the pricing of the product and the pace at which customers begin using the product. | ||||||||||||||||
We assess whether a substantive milestone exists at the inception of our agreements. When a substantive milestone is achieved, we recognize revenue related to the milestone payment. For our existing licensing and collaboration agreements in which we are involved in the discovery and/or development of the related drug or provide the partner with access to new technologies we discover, we have determined that the majority of future development, regulatory and commercialization milestones are substantive. For example, we consider most of the milestones associated with our strategic alliance with Biogen Idec substantive because we are using our antisense drug discovery platform to discover and develop new drugs against targets for neurological diseases. Alternatively, we considered milestones associated with our strategic alliance with Alnylam Pharmaceuticals, Inc. substantive because we provided Alnylam ongoing access to our technology to develop and commercialize RNA interference, or RNAi, therapeutics. In evaluating if a milestone is substantive we consider whether: | |||||||||||||||||
● | Substantive uncertainty exists as to the achievement of the milestone event at the inception of the arrangement; | ||||||||||||||||
● | The achievement of the milestone involves substantive effort and can only be achieved based in whole or in part on our performance or the occurrence of a specific outcome resulting from our performance; | ||||||||||||||||
● | The amount of the milestone payment appears reasonable either in relation to the effort expended or to the enhancement of the value of the delivered items; | ||||||||||||||||
● | There is no future performance required to earn the milestone; and | ||||||||||||||||
● | The consideration is reasonable relative to all deliverables and payment terms in the arrangement. | ||||||||||||||||
If any of these conditions are not met, we do not consider the milestone to be substantive and we defer recognition of the milestone payment and recognize it as revenue over the estimated period of performance, if any. We consider most milestone payments related to progression of a drug through the development and regulatory stages of its life cycle to be substantive milestones because the level of effort and inherent risk associated with these events is high. Further information about our collaborative arrangements can be found in Note 7, Collaborative Arrangements and Licensing Agreements. | |||||||||||||||||
Licensing and royalty revenue | |||||||||||||||||
We often enter into agreements to license our proprietary patent rights on an exclusive or non-exclusive basis in exchange for license fees and/or royalties. We generally recognize as revenue immediately those licensing fees and royalties for which we have no significant future performance obligations and are reasonably assured of collecting the resulting receivable. For example, in the first quarter of 2014, we recognized $7.7 million in sublicensing revenue from Alnylam related to its collaboration with Genzyme because we have no performance obligations related to Alnylam’s relationship with Genzyme and collectability was reasonably assured. | |||||||||||||||||
Cash, cash equivalents and short-term investments | ' | ||||||||||||||||
Cash, cash equivalents and short-term investments | |||||||||||||||||
We consider all liquid investments with maturities of three months or less when we purchase them to be cash equivalents. Our short-term investments have initial maturities of greater than three months from date of purchase. We classify our short-term investments as “available-for-sale” and carry them at fair market value based upon prices for identical or similar items on the last day of the fiscal period. We record unrealized gains and losses as a separate component of comprehensive income (loss) and include net realized gains and losses in gain (loss) on investments. We use the specific identification method to determine the cost of securities sold. | |||||||||||||||||
We have equity investments in privately- and publicly-held biotechnology companies that we have received as part of a technology license or collaboration agreement. At September 30, 2014 we held ownership interests of less than 20 percent in each of the respective companies. | |||||||||||||||||
We account for our equity investments in publicly-held companies at fair value and record unrealized gains and losses related to temporary increases and decreases in the stock of these publicly-held companies as a separate component of comprehensive income (loss). We account for equity investments in privately-held companies under the cost method of accounting because we own less than 20 percent and do not have significant influence over their operations. We hold one cost method investment in a small company, which we call a satellite company, and realization of our equity position in this company is uncertain. In this circumstance we recorded a full valuation allowance. In determining if and when a decrease in market value below our cost in our equity positions is temporary or other-than-temporary, we examine historical trends in the stock price, the financial condition of the company, near term prospects of the company and our current need for cash. If we determine that a decline in value in either a public or private investment is other-than-temporary, we recognize an impairment loss in the period in which the other-than-temporary decline occurs. | |||||||||||||||||
Inventory valuation | ' | ||||||||||||||||
Inventory valuation | |||||||||||||||||
We capitalize the costs of raw materials that we purchase for use in producing our drugs because until we use these raw materials they have alternative future uses. We include in inventory raw material costs for drugs that we manufacture for our partners under contractual terms and that we use primarily in our clinical development activities and drug products. We can use each of our raw materials in multiple products and, as a result, each raw material has future economic value independent of the development status of any single drug. For example, if one of our drugs failed, we could use the raw materials for that drug to manufacture our other drugs. We expense these costs when we deliver the drugs to our partners, or as we provide these drugs for our own clinical trials. We reflect our inventory on the balance sheet at the lower of cost or market value under the first-in, first-out method. We review inventory periodically and reduce the carrying value of items we consider to be slow moving or obsolete to their estimated net realizable value. We consider several factors in estimating the net realizable value, including shelf life of raw materials, alternative uses for our drugs and clinical trial materials, and historical write-offs. We did not record any inventory write-offs for the nine months ended September 30, 2014 and 2013. Total inventory, which consisted of raw materials, was $7.1 million and $8.0 million as of September 30, 2014 and December 31, 2013, respectively. | |||||||||||||||||
Research, development and patent expenses | ' | ||||||||||||||||
Research, development and patent expenses | |||||||||||||||||
Our research and development expenses include wages, benefits, facilities, supplies, external services, clinical trial and manufacturing costs and other expenses that are directly related to our research and development operations. We expense research and development costs as we incur them. When we make payments for research and development services prior to the services being rendered, we record those amounts as prepaid assets on our condensed consolidated balance sheet and we expense them as the services are provided. | |||||||||||||||||
We capitalize costs consisting principally of outside legal costs and filing fees related to obtaining patents. We amortize patent costs over the useful life of the patent, beginning with the date the United States Patent and Trademark Office, or foreign equivalent, issues the patent. We review our capitalized patent costs regularly to ensure that they include costs for patents and patent applications that have future value. We evaluate patents and patent applications that we are not actively pursuing and write off any associated costs. For the three and nine months ended September 30, 2014, patent expenses included non-cash charges related to the write-down of our patent costs to their estimated net realizable values of $0.5 million and $0.8 million, respectively, compared to $0.2 million and $0.4 million for the same periods in 2013. | |||||||||||||||||
Long-lived assets | ' | ||||||||||||||||
Long-lived assets | |||||||||||||||||
We evaluate long-lived assets, which include property, plant and equipment, patent costs, and exclusive licenses acquired from third parties, for impairment on at least a quarterly basis and whenever events or changes in circumstances indicate that we may not be able to recover the carrying amount of such assets. | |||||||||||||||||
Use of estimates | ' | ||||||||||||||||
Use of estimates | |||||||||||||||||
The preparation of condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results could differ from those estimates. | |||||||||||||||||
Reclassifications | ' | ||||||||||||||||
Reclassifications | |||||||||||||||||
We have reclassified certain immaterial prior period amounts to conform to the current period presentation. Certain amounts previously reported as research and development revenue have been reclassified to licensing and royalty revenue to conform to the current period presentation. | |||||||||||||||||
Basic and diluted net loss per share | ' | ||||||||||||||||
Basic and diluted net loss per share | |||||||||||||||||
We compute basic net loss per share by dividing the net loss by the weighted-average number of common shares outstanding during the period. As we incurred a net loss for the three and nine months ended September 30, 2014 and 2013, we did not include dilutive common equivalent shares in the computation of diluted net loss per share because the effect would have been anti-dilutive. Common stock from the following would have had an anti-dilutive effect on net loss per share: | |||||||||||||||||
● | 2¾ percent convertible senior notes; | ||||||||||||||||
● | Dilutive stock options; and | ||||||||||||||||
● | Restricted stock units. | ||||||||||||||||
Consolidation of variable interest entities | ' | ||||||||||||||||
Consolidation of variable interest entities | |||||||||||||||||
We identify entities as variable interest entities either: (1) that do not have sufficient equity investment at risk to permit the entity to finance its activities without additional subordinated financial support, or (2) in which the equity investors lack an essential characteristic of a controlling financial interest. We perform ongoing qualitative assessments of our variable interest entities to determine whether we have a controlling financial interest in the variable interest entity and therefore are the primary beneficiary. As of September 30, 2014 and December 31, 2013, we had collaborative arrangements with four and five entities, respectively, that we considered to be variable interest entities. We are not the primary beneficiary for any of these entities because we do not have the power to direct the activities that most significantly impact the economic performance of our variable interest entities, the obligation to absorb losses, or the right to receive benefits from our variable interest entities that could potentially be significant to the variable interest entities. As of September 30, 2014, the total carrying value of our investments in variable interest entities was $48.4 million, and was primarily related to our investment in Regulus. Our maximum exposure to loss related to these variable interest entities is limited to the carrying value of our investments. | |||||||||||||||||
Accumulated other comprehensive income | ' | ||||||||||||||||
Accumulated other comprehensive income | |||||||||||||||||
Accumulated other comprehensive income is comprised of unrealized gains and losses on securities, net of taxes, and adjustments we made to reclassify realized gains and losses on securities from other accumulated comprehensive income to our condensed consolidated statement of operations. The following table summarizes changes in accumulated other comprehensive income for the three and nine months ended September 30, 2014 and 2013 (in thousands): | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Beginning balance accumulated other comprehensive income | $ | 24,719 | $ | 26,986 | $ | 21,080 | $ | 12,480 | |||||||||
Unrealized (losses) gains on securities, net of tax (1) | (6,994 | ) | 2,207 | (3,189 | ) | 17,876 | |||||||||||
Amounts reclassified from accumulated other comprehensive income (2) | (831 | ) | (172 | ) | (997 | ) | (1,335 | ) | |||||||||
Net current period other comprehensive (loss) income | (7,825 | ) | 2,035 | (4,186 | ) | 16,541 | |||||||||||
Ending balance accumulated other comprehensive income | $ | 16,894 | $ | 29,021 | $ | 16,894 | $ | 29,021 | |||||||||
-1 | Other comprehensive (loss) income for the three months ended September 30, 2014 included income tax benefit of $2.5 million, compared to income tax expense of $1.4 million and $11.4 million for the three and nine months ended September 30, 2013, respectively. We recorded no income tax benefit or expense for the nine months ended September 30, 2014. | ||||||||||||||||
-2 | Included in gain on investments, net on our condensed consolidated statement of operations. | ||||||||||||||||
Convertible debt | ' | ||||||||||||||||
Convertible debt | |||||||||||||||||
In August 2012, we completed a $201.3 million offering of convertible senior notes, which mature in 2019 and bear interest at 2¾ percent. In September 2012, we used a substantial portion of the net proceeds from the issuance of the 2¾ percent notes to redeem our 2⅝ percent convertible subordinated notes. We account for our 2¾ percent notes by separating the liability and equity components of the instrument in a manner that reflects our nonconvertible debt borrowing rate. As a result, we assigned a value to the debt component of our 2 ¾ percent notes equal to the estimated fair value of similar debt instruments without the conversion feature, which resulted in us recording the debt instrument at a discount. We are amortizing the debt discount over the life of these 2¾ percent notes as additional non-cash interest expense utilizing the effective interest method. | |||||||||||||||||
Segment information | ' | ||||||||||||||||
Segment information | |||||||||||||||||
We operate in a single segment, Drug Discovery and Development operations, because our chief decision maker reviews operating results on an aggregate basis and manages our operations as a single operating segment. | |||||||||||||||||
Stock-based compensation expense | ' | ||||||||||||||||
Stock-based compensation expense | |||||||||||||||||
We measure stock-based compensation expense for equity-classified awards, principally related to stock options, restricted stock units, or RSUs, and stock purchase rights under our Employee Stock Purchase Plan, or ESPP, based on the estimated fair value of the award on the date of grant. We recognize the value of the portion of the award that we ultimately expect to vest as stock-based compensation expense over the requisite service period in our condensed consolidated statements of operations. We reduce stock-based compensation expense for estimated forfeitures at the time of grant and revise in subsequent periods if actual forfeitures differ from those estimates. | |||||||||||||||||
We use the Black-Scholes model to estimate the fair value of stock options granted and stock purchase rights under our ESPP. The expected term of stock options granted represents the period of time that we expect them to be outstanding. We estimate the expected term of options granted based on historical exercise patterns. For the nine months ended September 30, 2014 and 2013, we used the following weighted-average assumptions in our Black-Scholes calculations: | |||||||||||||||||
Employee Stock Options: | |||||||||||||||||
Nine Months Ended | |||||||||||||||||
September 30, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Risk-free interest rate | 1.60% | 1.00% | |||||||||||||||
Dividend yield | 0.00% | 0.00% | |||||||||||||||
Volatility | 50.70% | 51.40% | |||||||||||||||
Expected life | 4.6 years | 5.1 years | |||||||||||||||
ESPP: | |||||||||||||||||
Nine Months Ended | |||||||||||||||||
September 30, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Risk-free interest rate | 0.10% | 0.10% | |||||||||||||||
Dividend yield | 0.00% | 0.00% | |||||||||||||||
Volatility | 60.60% | 62.90% | |||||||||||||||
Expected life | 6 months | 6 months | |||||||||||||||
Board of Director Stock Options: | |||||||||||||||||
Nine Months Ended | |||||||||||||||||
September 30, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Risk-free interest rate | 2.20% | 2.20% | |||||||||||||||
Dividend yield | 0.00% | 0.00% | |||||||||||||||
Volatility | 54.20% | 52.70% | |||||||||||||||
Expected life | 6.9 years | 7.2 years | |||||||||||||||
The fair value of RSUs is based on the market price of our common stock on the date of grant. RSUs vest annually over a four year period. The weighted-average grant date fair value of RSUs granted to employees and the Board of Directors for the nine months ended September 30, 2014 was $45.80 and $38.10, respectively. | |||||||||||||||||
The following table summarizes stock-based compensation expense for the three and nine months ended September 30, 2014 and 2013 (in thousands), which was allocated as follows: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Research, development and patent expenses | $ | 6,606 | $ | 2,373 | $ | 18,879 | $ | 7,171 | |||||||||
General and administrative | 1,512 | 439 | 4,015 | 1,147 | |||||||||||||
Total | $ | 8,118 | $ | 2,812 | $ | 22,894 | $ | 8,318 | |||||||||
Non-cash stock-based compensation was $8.1 million and $22.9 million for the three and nine months ended September 30, 2014, respectively, and increased compared to $2.8 million and $8.3 million for the same periods in 2013 primarily due to the increase in our stock price. As of September 30, 2014, total unrecognized estimated non-cash stock-based compensation expense related to non-vested stock options and RSUs was $26.4 million and $11.5 million, respectively. We will adjust total unrecognized compensation cost for future changes in estimated forfeitures. We expect to recognize the cost of non-cash, stock-based compensation expense related to non-vested stock options and RSUs over a weighted average amortization period of 1.3 years and 1.5 years, respectively. | |||||||||||||||||
Impact of recently issued accounting standards | ' | ||||||||||||||||
Impact of recently issued accounting standards | |||||||||||||||||
In May 2014, the FASB issued accounting guidance on the recognition of revenue from customers. Under this guidance, an entity will recognize revenue when it transfers promised goods or services to customers in an amount that reflects what the entity expects in exchange for the goods or services. This guidance also requires more detailed disclosures to enable users of the financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016. The guidance allows us to select one of two methods of adoption, either the full retrospective approach, meaning the guidance would be applied to all periods presented, or modified retrospective, meaning the cumulative effect of applying the guidance would be recognized as an adjustment to our opening retained earnings balance. We will adopt this guidance in our fiscal year beginning January 1, 2017. We are currently evaluating an adoption method and the impact this guidance will have on our consolidated financial position, results of operations, cash flows and disclosures, and are currently unable to estimate the impact of this guidance. | |||||||||||||||||
In August 2014, the FASB issued accounting guidance on how and when to disclose going-concern uncertainties in the financial statements. This guidance requires us to perform interim and annual assessments to determine our ability to continue as a going concern within one year from the date that we issue our financial statements. The guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016. We will adopt this guidance in our fiscal year beginning January 1, 2017. We do not expect this guidance to have any effect on our financial statements. |
Significant_Accounting_Policie2
Significant Accounting Policies (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Significant Accounting Policies [Abstract] | ' | ||||||||||||||||
Changes in accumulated other comprehensive income related to unrealized gains and losses on securities | ' | ||||||||||||||||
Accumulated other comprehensive income is comprised of unrealized gains and losses on securities, net of taxes, and adjustments we made to reclassify realized gains and losses on securities from other accumulated comprehensive income to our condensed consolidated statement of operations. The following table summarizes changes in accumulated other comprehensive income for the three and nine months ended September 30, 2014 and 2013 (in thousands): | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Beginning balance accumulated other comprehensive income | $ | 24,719 | $ | 26,986 | $ | 21,080 | $ | 12,480 | |||||||||
Unrealized (losses) gains on securities, net of tax (1) | (6,994 | ) | 2,207 | (3,189 | ) | 17,876 | |||||||||||
Amounts reclassified from accumulated other comprehensive income (2) | (831 | ) | (172 | ) | (997 | ) | (1,335 | ) | |||||||||
Net current period other comprehensive (loss) income | (7,825 | ) | 2,035 | (4,186 | ) | 16,541 | |||||||||||
Ending balance accumulated other comprehensive income | $ | 16,894 | $ | 29,021 | $ | 16,894 | $ | 29,021 | |||||||||
-1 | Other comprehensive (loss) income for the three months ended September 30, 2014 included income tax benefit of $2.5 million, compared to income tax expense of $1.4 million and $11.4 million for the three and nine months ended September 30, 2013, respectively. We recorded no income tax benefit or expense for the nine months ended September 30, 2014. | ||||||||||||||||
-2 | Included in gain on investments, net on our condensed consolidated statement of operations. | ||||||||||||||||
Stock-based compensation expense | ' | ||||||||||||||||
Schedule of weighted-average assumptions used for valuation of ESPP | ' | ||||||||||||||||
ESPP: | |||||||||||||||||
Nine Months Ended | |||||||||||||||||
September 30, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Risk-free interest rate | 0.10% | 0.10% | |||||||||||||||
Dividend yield | 0.00% | 0.00% | |||||||||||||||
Volatility | 60.60% | 62.90% | |||||||||||||||
Expected life | 6 months | 6 months | |||||||||||||||
Schedule of stock-based compensation expense | ' | ||||||||||||||||
The following table summarizes stock-based compensation expense for the three and nine months ended September 30, 2014 and 2013 (in thousands), which was allocated as follows: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Research, development and patent expenses | $ | 6,606 | $ | 2,373 | $ | 18,879 | $ | 7,171 | |||||||||
General and administrative | 1,512 | 439 | 4,015 | 1,147 | |||||||||||||
Total | $ | 8,118 | $ | 2,812 | $ | 22,894 | $ | 8,318 | |||||||||
Employee Stock Options [Member] | ' | ||||||||||||||||
Stock-based compensation expense | ' | ||||||||||||||||
Schedule of weighted-average assumptions used for valuation of stock options | ' | ||||||||||||||||
We use the Black-Scholes model to estimate the fair value of stock options granted and stock purchase rights under our ESPP. The expected term of stock options granted represents the period of time that we expect them to be outstanding. We estimate the expected term of options granted based on historical exercise patterns. For the nine months ended September 30, 2014 and 2013, we used the following weighted-average assumptions in our Black-Scholes calculations: | |||||||||||||||||
Employee Stock Options: | |||||||||||||||||
Nine Months Ended | |||||||||||||||||
September 30, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Risk-free interest rate | 1.60% | 1.00% | |||||||||||||||
Dividend yield | 0.00% | 0.00% | |||||||||||||||
Volatility | 50.70% | 51.40% | |||||||||||||||
Expected life | 4.6 years | 5.1 years | |||||||||||||||
Board of Director Stock Option [Member] | ' | ||||||||||||||||
Stock-based compensation expense | ' | ||||||||||||||||
Schedule of weighted-average assumptions used for valuation of stock options | ' | ||||||||||||||||
Board of Director Stock Options: | |||||||||||||||||
Nine Months Ended | |||||||||||||||||
September 30, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Risk-free interest rate | 2.20% | 2.20% | |||||||||||||||
Dividend yield | 0.00% | 0.00% | |||||||||||||||
Volatility | 54.20% | 52.70% | |||||||||||||||
Expected life | 6.9 years | 7.2 years |
Investments_Tables
Investments (Tables) | 9 Months Ended | ||||||||||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||||||||||
Investments [Abstract] | ' | ||||||||||||||||||||||||||||
Summary of contract maturity of available-for-sale securities | ' | ||||||||||||||||||||||||||||
The following table summarizes the contract maturity of the available-for-sale securities we held as of September 30, 2014: | |||||||||||||||||||||||||||||
One year or less | 57% | ||||||||||||||||||||||||||||
After one year but within two years | 32% | ||||||||||||||||||||||||||||
After two years but within three years | 11% | ||||||||||||||||||||||||||||
Total | 100% | ||||||||||||||||||||||||||||
Summary of investments | ' | ||||||||||||||||||||||||||||
The following is a summary of our investments (in thousands): | |||||||||||||||||||||||||||||
Amortized | Unrealized | Other- | Estimated | ||||||||||||||||||||||||||
Than- | |||||||||||||||||||||||||||||
Temporary | |||||||||||||||||||||||||||||
Impairment | |||||||||||||||||||||||||||||
30-Sep-14 | Cost | Gains | Losses | Loss | Fair Value | ||||||||||||||||||||||||
Available-for-sale securities: | |||||||||||||||||||||||||||||
Corporate debt securities(1) | $ | 205,973 | $ | 153 | $ | (67 | ) | $ | — | $ | 206,059 | ||||||||||||||||||
Debt securities issued by U.S. government agencies (1) | 51,021 | 13 | (35 | ) | — | 50,999 | |||||||||||||||||||||||
Debt securities issued by the U.S. Treasury | 9,022 | 18 | — | — | 9,040 | ||||||||||||||||||||||||
Debt securities issued by states of the United States and political subdivisions of the states | 38,134 | 19 | (48 | ) | — | 38,105 | |||||||||||||||||||||||
Total securities with a maturity of one year or less | 304,150 | 203 | (150 | ) | — | 304,203 | |||||||||||||||||||||||
Corporate debt securities | 148,079 | 55 | (345 | ) | — | 147,789 | |||||||||||||||||||||||
Debt securities issued by U.S. government agencies | 55,525 | 5 | (132 | ) | — | 55,398 | |||||||||||||||||||||||
Debt securities issued by states of the United States and political subdivisions of the states | 26,275 | 41 | (77 | ) | — | 26,239 | |||||||||||||||||||||||
Total securities with a maturity of more than one year | 229,879 | 101 | (554 | ) | — | 229,426 | |||||||||||||||||||||||
Total available-for-sale securities | $ | 534,029 | $ | 304 | $ | (704 | ) | $ | — | $ | 533,629 | ||||||||||||||||||
Cost | Unrealized | Other- | Estimated | ||||||||||||||||||||||||||
Than- | |||||||||||||||||||||||||||||
Temporary | |||||||||||||||||||||||||||||
Impairment | |||||||||||||||||||||||||||||
30-Sep-14 | Basis | Gains | Losses | Loss | Fair Value | ||||||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||||||
Regulus Therapeutics Inc. | $ | 15,316 | $ | 32,110 | $ | — | $ | — | $ | 47,426 | |||||||||||||||||||
Securities included in other current assets | 1,269 | 1,021 | — | (1,269 | ) | 1,021 | |||||||||||||||||||||||
Total equity securities | $ | 16,585 | $ | 33,131 | $ | — | $ | (1,269 | ) | $ | 48,447 | ||||||||||||||||||
Total available-for-sale and equity securities | $ | 550,614 | $ | 33,435 | $ | (704 | ) | $ | (1,269 | ) | $ | 582,076 | |||||||||||||||||
Amortized | Unrealized | Other- | Estimated | ||||||||||||||||||||||||||
Than- | |||||||||||||||||||||||||||||
Temporary | |||||||||||||||||||||||||||||
Impairment | |||||||||||||||||||||||||||||
31-Dec-13 | Cost | Gains | Losses | Loss | Fair Value | ||||||||||||||||||||||||
Available-for-sale securities: | |||||||||||||||||||||||||||||
Corporate debt securities(1) | $ | 142,096 | $ | 75 | $ | (27 | ) | $ | — | $ | 142,144 | ||||||||||||||||||
Debt securities issued by U.S. government agencies (1) | 23,242 | 22 | (16 | ) | — | 23,248 | |||||||||||||||||||||||
Debt securities issued by the U.S. Treasury | 6,239 | 6 | — | — | 6,245 | ||||||||||||||||||||||||
Debt securities issued by states of the United States and political subdivisions of the states | 8,082 | 6 | (28 | ) | — | 8,060 | |||||||||||||||||||||||
Total securities with a maturity of one year or less | 179,659 | 109 | (71 | ) | — | 179,697 | |||||||||||||||||||||||
Corporate debt securities | 265,969 | 177 | (393 | ) | — | 265,753 | |||||||||||||||||||||||
Debt securities issued by U.S. government agencies | 41,308 | 3 | (127 | ) | — | 41,184 | |||||||||||||||||||||||
Debt securities issued by the U.S. Treasury | 9,062 | 21 | — | — | 9,083 | ||||||||||||||||||||||||
Debt securities issued by states of the United States and political subdivisions of the states | 14,186 | 37 | (28 | ) | — | 14,195 | |||||||||||||||||||||||
Total securities with a maturity of more than one year | 330,525 | 238 | (548 | ) | — | 330,215 | |||||||||||||||||||||||
Total available-for-sale securities | $ | 510,184 | $ | 347 | $ | (619 | ) | $ | — | $ | 509,912 | ||||||||||||||||||
Cost | Unrealized | Other- | Estimated | ||||||||||||||||||||||||||
Than- | |||||||||||||||||||||||||||||
Temporary | |||||||||||||||||||||||||||||
Impairment | |||||||||||||||||||||||||||||
31-Dec-13 | Basis | Gains | Losses | Loss | Fair Value | ||||||||||||||||||||||||
Equity securities: | |||||||||||||||||||||||||||||
Regulus Therapeutics Inc. | $ | 15,526 | $ | 36,570 | $ | — | $ | — | $ | 52,096 | |||||||||||||||||||
Securities included in other current assets | 1,538 | 618 | — | (880 | ) | 1,276 | |||||||||||||||||||||||
Securities included in deposits and other assets | 625 | — | — | — | 625 | ||||||||||||||||||||||||
Total equity securities | $ | 17,689 | $ | 37,188 | $ | — | $ | (880 | ) | $ | 53,997 | ||||||||||||||||||
Total available-for-sale and equity securities | $ | 527,873 | $ | 37,535 | $ | (619 | ) | $ | (880 | ) | $ | 563,909 | |||||||||||||||||
-1 | Includes investments classified as cash equivalents on our condensed consolidated balance sheet. | ||||||||||||||||||||||||||||
Schedule of investments temporarily impaired | ' | ||||||||||||||||||||||||||||
Investments we considered to be temporarily impaired at September 30, 2014 were as follows (in thousands): | |||||||||||||||||||||||||||||
Less than 12 months of | More than 12 months of | Total temporary | |||||||||||||||||||||||||||
temporary impairment | temporary impairment | impairment | |||||||||||||||||||||||||||
Number of | Estimated | Unrealized | Estimated | Unrealized | Estimated | Unrealized | |||||||||||||||||||||||
Investments | Fair Value | Losses | Fair Value | Losses | Fair Value | Losses | |||||||||||||||||||||||
Corporate debt securities | 178 | $ | 165,321 | $ | (397 | ) | $ | 9,266 | $ | (15 | ) | $ | 174,587 | $ | (412 | ) | |||||||||||||
Debt securities issued by U.S. government agencies | 10 | 56,358 | (167 | ) | - | - | 56,358 | (167 | ) | ||||||||||||||||||||
Debt securities issued by states of the United States and political subdivisions of the states | 19 | 22,661 | (78 | ) | 228 | (47 | ) | 22,889 | (125 | ) | |||||||||||||||||||
Total temporarily impaired securities | 207 | $ | 244,340 | $ | (642 | ) | $ | 9,494 | $ | (62 | ) | $ | 253,834 | $ | (704 | ) |
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Fair Value Measurements [Abstract] | ' | ||||||||||||||||
Schedule of assets measured at fair value on a recurring basis | ' | ||||||||||||||||
We measure the following major security types at fair value on a recurring basis. The following summary breaks down the fair-value hierarchy that each security is valued with at September 30, 2014 and December 31, 2013 as follows (in thousands): | |||||||||||||||||
At September 30, | Quoted Prices in | Significant Other | Significant | ||||||||||||||
2014 | Active Markets | Observable | Unobservable | ||||||||||||||
(Level 1) | Inputs | Inputs | |||||||||||||||
(Level 2) | (Level 3) | ||||||||||||||||
Cash equivalents | $ | 44,551 | $ | 44,551 | $ | — | $ | — | |||||||||
Corporate debt securities (1) | 353,848 | — | 353,848 | — | |||||||||||||
Debt securities issued by U.S. government agencies (1) | 106,397 | — | 106,397 | — | |||||||||||||
Debt securities issued by the U.S. Treasury | 9,040 | 9,040 | — | — | |||||||||||||
Debt securities issued by states of the United States and political subdivisions of the states (1) | 64,344 | — | 64,344 | — | |||||||||||||
Investment in Regulus Therapeutics Inc. | 47,426 | 47,426 | — | — | |||||||||||||
Equity securities (2) | 1,021 | 1,021 | — | — | |||||||||||||
Total | $ | 626,627 | $ | 102,038 | $ | 524,589 | $ | — | |||||||||
At December 31, | Quoted Prices in | Significant Other | Significant | ||||||||||||||
2013 | Active Markets | Observable | Unobservable | ||||||||||||||
(Level 1) | Inputs | Inputs | |||||||||||||||
(Level 2) | (Level 3) | ||||||||||||||||
Cash equivalents | $ | 133,233 | $ | 133,233 | $ | — | $ | — | |||||||||
Corporate debt securities (1) | 407,897 | — | 407,897 | — | |||||||||||||
Debt securities issued by U.S. government agencies | 64,432 | — | 64,432 | — | |||||||||||||
Debt securities issued by the U.S. Treasury | 15,328 | 15,328 | — | — | |||||||||||||
Debt securities issued by states of the United States and political subdivisions of the states | 22,255 | — | 22,255 | — | |||||||||||||
Investment in Regulus Therapeutics Inc. | 52,096 | 52,096 | — | — | |||||||||||||
Equity securities (2) | 1,276 | 1,276 | — | — | |||||||||||||
Total | $ | 696,517 | $ | 201,933 | $ | 494,584 | $ | — | |||||||||
-1 | Includes investments classified as cash equivalents on our condensed consolidated balance sheet. | ||||||||||||||||
-2 | Included in other current assets on our condensed consolidated balance sheet. | ||||||||||||||||
Summary of investments measured at fair value on a recurring basis using significant unobservable inputs (Level 3) | ' | ||||||||||||||||
The following is a summary of our investments measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the nine months ended September 30, 2014 (in thousands): | |||||||||||||||||
Beginning balance of Level 3 investments | $ | - | |||||||||||||||
Total gain included in accumulated other comprehensive income (loss) | 1,231 | ||||||||||||||||
Transfers out of Level 3 investments | (1,231 | ) | |||||||||||||||
Ending balance of Level 3 investments | $ | - |
Concentration_of_Business_Risk1
Concentration of Business Risk (Tables) | 9 Months Ended | |||||||||||
Sep. 30, 2014 | ||||||||||||
Concentration of Business Risk [Abstract] | ' | |||||||||||
Schedule of revenue from significant partners | ' | |||||||||||
We have historically funded our operations from collaborations with corporate partners and a relatively small number of partners have accounted for a significant percentage of our revenue. Revenue from significant partners, which is defined as ten percent or more of our total revenue, was as follows: | ||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||
September 30, | September 30, | |||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||
Partner A | 72% | 25% | 59% | 16% | ||||||||
Partner B | 12% | 48% | 9% | 22% | ||||||||
Partner C | 1% | 18% | 15% | 21% | ||||||||
Partner D | 0% | 0% | 0% | 31% |
Significant_Accounting_Policie3
Significant Accounting Policies, Revenue Recognition (Details) (USD $) | 3 Months Ended | 9 Months Ended | 1 Months Ended | 7 Months Ended | 1 Months Ended | 7 Months Ended | 1 Months Ended | 9 Months Ended | 1 Months Ended | 3 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2012 | Jun. 30, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Jun. 30, 2013 | Dec. 31, 2012 | Jun. 30, 2013 | Mar. 31, 2010 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Jan. 31, 2012 | Jun. 30, 2012 | Dec. 31, 2012 | Sep. 30, 2013 | Mar. 31, 2004 | Mar. 31, 2014 | |
Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | GSK [Member] | GSK [Member] | Biogen Idec [Member] | Biogen Idec [Member] | Biogen Idec [Member] | Biogen Idec [Member] | Biogen Idec [Member] | Biogen Idec [Member] | Alnylam [Member] | Alnylam [Member] | |||||
Category | Development milestones - new development candidate [Member] | Development milestones - new development candidate [Member] | Development milestones - Phase 1 [Member] | Development milestones - Phase 1 [Member] | Development milestones - Phase 2 [Member] | Development milestones - Phase 2 [Member] | Development milestones - Phase 3 [Member] | Development milestones - Phase 3 [Member] | Regulatory milestones [Member] | Regulatory milestones [Member] | Commercialization milestones [Member] | Agreement entered into in December 2012 [Member] | Agreement entered into in December 2012 [Member] | Agreement entered into in December 2012 [Member] | Agreement entered into in December 2012 [Member] | Agreement entered into in December 2012 [Member] | Agreement entered into in December 2012 [Member] | Agreement entered into in December 2012 [Member] | Agreement entered into in December 2012 [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Agreement entered into in January 2012 [Member] | Agreement entered into in June 2012 [Member] | Agreement entered into in December 2012 [Member] | Agreement entered into in September 2013 [Member] | Collaborations and Licensing Agreements [Member] | Alnylam's collaboration with Genzyme [Member] | |||||
Stage | Minimum [Member] | Maximum [Member] | Minimum [Member] | Maximum [Member] | Minimum [Member] | Maximum [Member] | Minimum [Member] | Maximum [Member] | Minimum [Member] | Maximum [Member] | AccountingUnit | Maximum [Member] | ISIS-AR [Member] | ISIS-STAT3 License [Member] | ISIS-STAT3 License [Member] | ISIS-STAT3 License [Member] | Drug | Agreement | Strategic Neurology [Member] | ISIS-SMN [Member] | ISIS-DMPK [Member] | Neurology [Member] | Strategic Neurology [Member] | |||||||||||
Target | Drug | AccountingUnit | Target | |||||||||||||||||||||||||||||||
Research and development revenue under collaborative agreements | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of targets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3 | ' | ' | ' |
Upfront fee received | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $6,000,000 | $25,000,000 | $31,000,000 | ' | ' | ' | ' | ' | $35,000,000 | ' | ' | ' | ' | ' | ' | ' | $5,000,000 | ' |
Upfront fee recorded as deferred revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 19,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 29,000,000 | 12,000,000 | 30,000,000 | 100,000,000 | ' | ' |
Number of drugs collaborative partner may license under the separate research program | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of units of accounting | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4 | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Upfront fee recognized | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,200,000 | 9,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Assumed change in estimated selling price (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage by which earned revenue would change based on assumed change in estimated selling price (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 7.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount by which earned revenue would change based on assumed change in estimated selling price | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 750,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of new development candidates added to collaboration | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' |
Number of collaborative agreements | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4 | ' | ' | ' | ' | ' | ' | ' |
Decrease in amortization of upfront payments for 2014 | ' | ' | ' | ' | -3,700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Term of collaboration agreement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '6 years | ' | ' | ' | '6 years | ' | ' |
Number of categories of milestone events | ' | ' | ' | ' | 3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of stages of life-cycle of drugs | ' | ' | ' | ' | 3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Completion period | ' | ' | ' | ' | ' | '12 months | '18 months | '1 year | '2 years | '1 year | '3 years | '2 years | '4 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Time to prepare and submit regulatory filings | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '6 months | '12 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Time to obtain approval | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year | '2 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Example of sales threshold as milestone event | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,000,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Licensing and royalty revenue | $265,000 | $327,000 | $9,325,000 | $2,493,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $7,700,000 |
Significant_Accounting_Policie4
Significant Accounting Policies, Cash, Cash Equivalents and Short-term Investments, Inventory Valuation, and Research, Development and Patent Expenses (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 |
Patents [Member] | Patents [Member] | Patents [Member] | Patents [Member] | Maximum [Member] | |||
Privately- and Publicly-Held Biotechnology Companies [Member] | |||||||
Cash, cash equivalents and short-term investments | ' | ' | ' | ' | ' | ' | ' |
Ownership percentage in equity investments (in hundredths) | ' | ' | ' | ' | ' | ' | 20.00% |
Inventory valuation [Abstract] | ' | ' | ' | ' | ' | ' | ' |
Raw materials | $7,085,000 | $8,033,000 | ' | ' | ' | ' | ' |
Research, development and patent expenses [Abstract] | ' | ' | ' | ' | ' | ' | ' |
Write-down | ' | ' | $500,000 | $200,000 | $800,000 | $400,000 | ' |
Significant_Accounting_Policie5
Significant Accounting Policies, Consolidation of Variable Interest Entities (Details) (USD $) | 9 Months Ended | 12 Months Ended |
In Millions, unless otherwise specified | Sep. 30, 2014 | Dec. 31, 2013 |
Entity | Entity | |
Consolidation of variable interest entities [Abstract] | ' | ' |
Number of variable interest entities in which the entity is not primary beneficiary | 4 | 5 |
Carrying value of investments in variable interest entities | $48.40 | ' |
Significant_Accounting_Policie6
Significant Accounting Policies, Accumulated Other Comprehensive Income (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |||||
Summary of changes in accumulated other comprehensive income [Roll Forward] | ' | ' | ' | ' | ||||
Beginning balance accumulated other comprehensive income | $24,719,000 | $26,986,000 | $21,080,000 | $12,480,000 | ||||
Unrealized (losses) gains on securities, net of tax | -6,994,000 | [1] | 2,207,000 | [1] | -3,189,000 | [1] | 17,876,000 | [1] |
Amounts reclassified from accumulated other comprehensive income | -831,000 | [2] | -172,000 | [2] | -997,000 | [2] | -1,335,000 | [2] |
Net current period other comprehensive (loss) income | -7,825,000 | 2,035,000 | -4,186,000 | 16,541,000 | ||||
Ending balance accumulated other comprehensive income | 16,894,000 | 29,021,000 | 16,894,000 | 29,021,000 | ||||
Income tax expense (benefit) included in other comprehensive income | ($2,500,000) | $1,400,000 | $0 | $11,400,000 | ||||
[1] | Other comprehensive (loss) income for the three months ended September 30, 2014 included income tax benefit of $2.5 million, compared to income tax expense of $1.4 million and $11.4 million for the three and nine months ended September 30, 2013, respectively. We recorded no income tax benefit or expense for the nine months ended September 30, 2014. | |||||||
[2] | Included in gain on investments, net on our condensed consolidated statement of operations. |
Significant_Accounting_Policie7
Significant Accounting Policies, Convertible Debt (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Aug. 31, 2012 | Sep. 30, 2014 |
In Millions, unless otherwise specified | 2 3/4 percent convertible senior notes [Member] | 2 3/4 percent convertible senior notes [Member] | 2 5/8 percent convertible subordinated notes [Member] | ||
Long-term obligations | ' | ' | ' | ' | ' |
Debt issued | ' | ' | ' | $201.30 | ' |
Interest rate on convertible debt (in hundredths) | 2.75% | 2.75% | 2.75% | ' | 2.63% |
Significant_Accounting_Policie8
Significant Accounting Policies, Stock-Based Compensation Expense - Weighted-Average Assumptions (Details) | 9 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Employee Stock Options [Member] | ' | ' |
Weighted-average assumptions | ' | ' |
Risk-free interest rate (in hundredths) | 1.60% | 1.00% |
Dividend yield (in hundredths) | 0.00% | 0.00% |
Volatility (in hundredths) | 50.70% | 51.40% |
Expected life | '4 years 7 months 6 days | '5 years 1 month 6 days |
ESPP [Member] | ' | ' |
Weighted-average assumptions | ' | ' |
Risk-free interest rate (in hundredths) | 0.10% | 0.10% |
Dividend yield (in hundredths) | 0.00% | 0.00% |
Volatility (in hundredths) | 60.60% | 62.90% |
Expected life | '6 months | '6 months |
Board of Director Stock Options [Member] | ' | ' |
Weighted-average assumptions | ' | ' |
Risk-free interest rate (in hundredths) | 2.20% | 2.20% |
Dividend yield (in hundredths) | 0.00% | 0.00% |
Volatility (in hundredths) | 54.20% | 52.70% |
Expected life | '6 years 10 months 24 days | '7 years 2 months 12 days |
Significant_Accounting_Policie9
Significant Accounting Policies, Stock-Based Compensation Expense (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |
Allocation of stock-based compensation expense | ' | ' | ' | ' |
Stock-based compensation expense | $8,118,000 | $2,812,000 | $22,894,000 | $8,318,000 |
Stock Option [Member] | ' | ' | ' | ' |
Allocation of stock-based compensation expense | ' | ' | ' | ' |
Unrecognized estimated non-cash stock-based compensation expense | 26,400,000 | ' | 26,400,000 | ' |
Weighted average period of amortization | ' | ' | '1 year 3 months 18 days | ' |
RSUs [Member] | ' | ' | ' | ' |
Allocation of stock-based compensation expense | ' | ' | ' | ' |
Vesting period | ' | ' | '4 years | ' |
Unrecognized estimated non-cash stock-based compensation expense | 11,500,000 | ' | 11,500,000 | ' |
Weighted average period of amortization | ' | ' | '1 year 6 months | ' |
RSUs [Member] | Employees [Member] | ' | ' | ' | ' |
Allocation of stock-based compensation expense | ' | ' | ' | ' |
Weighted-average grant date fair value (in dollars per share) | ' | ' | $45.80 | ' |
RSUs [Member] | Board of Directors [Member] | ' | ' | ' | ' |
Allocation of stock-based compensation expense | ' | ' | ' | ' |
Weighted-average grant date fair value (in dollars per share) | ' | ' | $38.10 | ' |
Research, Development and Patent Expenses [Member] | ' | ' | ' | ' |
Allocation of stock-based compensation expense | ' | ' | ' | ' |
Stock-based compensation expense | 6,606,000 | 2,373,000 | 18,879,000 | 7,171,000 |
General and Administrative [Member] | ' | ' | ' | ' |
Allocation of stock-based compensation expense | ' | ' | ' | ' |
Stock-based compensation expense | $1,512,000 | $439,000 | $4,015,000 | $1,147,000 |
Investments_Contract_Maturity_
Investments, Contract Maturity of Available-for-Sale Securities (Details) | Sep. 30, 2014 |
Company | |
Contract maturity of available-for-sale securities [Abstract] | ' |
One year or less (in hundredths) | 57.00% |
After one year but within two years (in hundredths) | 32.00% |
After two years but within three years (in hundredths) | 11.00% |
Total (in hundredths) | 100.00% |
Percentage of available-for-sale securities with a maturity of less than two years (in hundredths) | 89.00% |
Ownership interests in private and public companies [Abstract] | ' |
Number of privately-held companies in which the entity has an equity ownership interest of less than 20% | 1 |
Number of publicly-held companies in which the entity has an equity ownership interest of less than 20% | 4 |
Investments_Summary_of_Investm
Investments, Summary of Investments and Investments Temporarily Impaired (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | Investment | |||
Investments | ' | ' | ||
Cost Basis | $550,614 | $527,873 | ||
Unrealized Gains | 33,435 | 37,535 | ||
Unrealized Losses | -704 | -619 | ||
Other-Than-Temporary Impairment Loss | -1,269 | -880 | ||
Estimated Fair Value | 582,076 | 563,909 | ||
Temporarily impaired investments [Abstract] | ' | ' | ||
Temporarily impaired securities, Number of Investments | 207 | ' | ||
Temporarily impaired securities, Less than 12 months of temporary impairment, Estimated Fair Value | 244,340 | ' | ||
Temporarily impaired securities, Less than 12 months of temporary impairment, Unrealized Losses | -642 | ' | ||
Temporarily impaired securities, More than 12 months of temporary impairment, Estimated Fair Value | 9,494 | ' | ||
Temporarily impaired securities, More than 12 months of temporary impairment, Unrealized Losses | -62 | ' | ||
Total temporary impairment, Estimated Fair Value | 253,834 | ' | ||
Total temporary impairment, Unrealized Losses | -704 | ' | ||
Available-for-sale securities [Member] | ' | ' | ||
Investments | ' | ' | ||
Amortized Cost | 534,029 | 510,184 | ||
Unrealized Gains | 304 | 347 | ||
Unrealized Losses | -704 | -619 | ||
Other-Than-Temporary Impairment Loss | 0 | 0 | ||
Estimated Fair Value | 533,629 | 509,912 | ||
Available-for-sale securities [Member] | Debt maturities of one year or less [Member] | ' | ' | ||
Investments | ' | ' | ||
Amortized Cost | 304,150 | 179,659 | ||
Unrealized Gains | 203 | 109 | ||
Unrealized Losses | -150 | -71 | ||
Other-Than-Temporary Impairment Loss | 0 | 0 | ||
Estimated Fair Value | 304,203 | 179,697 | ||
Available-for-sale securities [Member] | Debt maturities of more than one year [Member] | ' | ' | ||
Investments | ' | ' | ||
Amortized Cost | 229,879 | 330,525 | ||
Unrealized Gains | 101 | 238 | ||
Unrealized Losses | -554 | -548 | ||
Other-Than-Temporary Impairment Loss | 0 | 0 | ||
Estimated Fair Value | 229,426 | 330,215 | ||
Corporate debt securities [Member] | ' | ' | ||
Temporarily impaired investments [Abstract] | ' | ' | ||
Temporarily impaired securities, Number of Investments | 178 | ' | ||
Temporarily impaired securities, Less than 12 months of temporary impairment, Estimated Fair Value | 165,321 | ' | ||
Temporarily impaired securities, Less than 12 months of temporary impairment, Unrealized Losses | -397 | ' | ||
Temporarily impaired securities, More than 12 months of temporary impairment, Estimated Fair Value | 9,266 | ' | ||
Temporarily impaired securities, More than 12 months of temporary impairment, Unrealized Losses | -15 | ' | ||
Total temporary impairment, Estimated Fair Value | 174,587 | ' | ||
Total temporary impairment, Unrealized Losses | -412 | ' | ||
Corporate debt securities [Member] | Debt maturities of one year or less [Member] | ' | ' | ||
Investments | ' | ' | ||
Amortized Cost | 205,973 | [1] | 142,096 | [2] |
Unrealized Gains | 153 | [1] | 75 | [2] |
Unrealized Losses | -67 | [1] | -27 | [2] |
Other-Than-Temporary Impairment Loss | 0 | [1] | 0 | [2] |
Estimated Fair Value | 206,059 | [1] | 142,144 | [2] |
Corporate debt securities [Member] | Debt maturities of more than one year [Member] | ' | ' | ||
Investments | ' | ' | ||
Amortized Cost | 148,079 | 265,969 | ||
Unrealized Gains | 55 | 177 | ||
Unrealized Losses | -345 | -393 | ||
Other-Than-Temporary Impairment Loss | 0 | 0 | ||
Estimated Fair Value | 147,789 | 265,753 | ||
Debt securities issued by U.S. government agencies [Member] | ' | ' | ||
Temporarily impaired investments [Abstract] | ' | ' | ||
Temporarily impaired securities, Number of Investments | 10 | ' | ||
Temporarily impaired securities, Less than 12 months of temporary impairment, Estimated Fair Value | 56,358 | ' | ||
Temporarily impaired securities, Less than 12 months of temporary impairment, Unrealized Losses | -167 | ' | ||
Temporarily impaired securities, More than 12 months of temporary impairment, Estimated Fair Value | 0 | ' | ||
Temporarily impaired securities, More than 12 months of temporary impairment, Unrealized Losses | 0 | ' | ||
Total temporary impairment, Estimated Fair Value | 56,358 | ' | ||
Total temporary impairment, Unrealized Losses | -167 | ' | ||
Debt securities issued by U.S. government agencies [Member] | Debt maturities of one year or less [Member] | ' | ' | ||
Investments | ' | ' | ||
Amortized Cost | 51,021 | [1] | 23,242 | [2] |
Unrealized Gains | 13 | [1] | 22 | [2] |
Unrealized Losses | -35 | [1] | -16 | [2] |
Other-Than-Temporary Impairment Loss | 0 | [1] | 0 | [2] |
Estimated Fair Value | 50,999 | [1] | 23,248 | [2] |
Debt securities issued by U.S. government agencies [Member] | Debt maturities of more than one year [Member] | ' | ' | ||
Investments | ' | ' | ||
Amortized Cost | 55,525 | 41,308 | ||
Unrealized Gains | 5 | 3 | ||
Unrealized Losses | -132 | -127 | ||
Other-Than-Temporary Impairment Loss | 0 | 0 | ||
Estimated Fair Value | 55,398 | 41,184 | ||
Debt securities issued by the U.S. Treasury [Member] | Debt maturities of one year or less [Member] | ' | ' | ||
Investments | ' | ' | ||
Amortized Cost | 9,022 | 6,239 | ||
Unrealized Gains | 18 | 6 | ||
Unrealized Losses | 0 | 0 | ||
Other-Than-Temporary Impairment Loss | 0 | 0 | ||
Estimated Fair Value | 9,040 | 6,245 | ||
Debt securities issued by the U.S. Treasury [Member] | Debt maturities of more than one year [Member] | ' | ' | ||
Investments | ' | ' | ||
Amortized Cost | ' | 9,062 | ||
Unrealized Gains | ' | 21 | ||
Unrealized Losses | ' | 0 | ||
Other-Than-Temporary Impairment Loss | ' | 0 | ||
Estimated Fair Value | ' | 9,083 | ||
Debt securities issued by states of the United States and political subdivisions of the states [Member] | ' | ' | ||
Temporarily impaired investments [Abstract] | ' | ' | ||
Temporarily impaired securities, Number of Investments | 19 | ' | ||
Temporarily impaired securities, Less than 12 months of temporary impairment, Estimated Fair Value | 22,661 | ' | ||
Temporarily impaired securities, Less than 12 months of temporary impairment, Unrealized Losses | -78 | ' | ||
Temporarily impaired securities, More than 12 months of temporary impairment, Estimated Fair Value | 228 | ' | ||
Temporarily impaired securities, More than 12 months of temporary impairment, Unrealized Losses | -47 | ' | ||
Total temporary impairment, Estimated Fair Value | 22,889 | ' | ||
Total temporary impairment, Unrealized Losses | -125 | ' | ||
Debt securities issued by states of the United States and political subdivisions of the states [Member] | Debt maturities of one year or less [Member] | ' | ' | ||
Investments | ' | ' | ||
Amortized Cost | 38,134 | 8,082 | ||
Unrealized Gains | 19 | 6 | ||
Unrealized Losses | -48 | -28 | ||
Other-Than-Temporary Impairment Loss | 0 | 0 | ||
Estimated Fair Value | 38,105 | 8,060 | ||
Debt securities issued by states of the United States and political subdivisions of the states [Member] | Debt maturities of more than one year [Member] | ' | ' | ||
Investments | ' | ' | ||
Amortized Cost | 26,275 | 14,186 | ||
Unrealized Gains | 41 | 37 | ||
Unrealized Losses | -77 | -28 | ||
Other-Than-Temporary Impairment Loss | 0 | 0 | ||
Estimated Fair Value | 26,239 | 14,195 | ||
Equity securities [Member] | ' | ' | ||
Investments | ' | ' | ||
Cost Basis | 16,585 | 17,689 | ||
Unrealized Gains | 33,131 | 37,188 | ||
Unrealized Losses | 0 | 0 | ||
Other-Than-Temporary Impairment Loss | -1,269 | -880 | ||
Estimated Fair Value | 48,447 | 53,997 | ||
Equity securities [Member] | Securities included in other current assets [Member] | ' | ' | ||
Investments | ' | ' | ||
Cost Basis | 1,269 | 1,538 | ||
Unrealized Gains | 1,021 | 618 | ||
Unrealized Losses | 0 | 0 | ||
Other-Than-Temporary Impairment Loss | -1,269 | -880 | ||
Estimated Fair Value | 1,021 | 1,276 | ||
Equity securities [Member] | Securities included in deposits and other assets [Member] | ' | ' | ||
Investments | ' | ' | ||
Cost Basis | ' | 625 | ||
Unrealized Gains | ' | 0 | ||
Unrealized Losses | ' | 0 | ||
Other-Than-Temporary Impairment Loss | ' | 0 | ||
Estimated Fair Value | ' | 625 | ||
Equity securities [Member] | Regulus Therapeutics Inc. [Member] | ' | ' | ||
Investments | ' | ' | ||
Cost Basis | 15,316 | 15,526 | ||
Unrealized Gains | 32,110 | 36,570 | ||
Unrealized Losses | 0 | 0 | ||
Other-Than-Temporary Impairment Loss | 0 | 0 | ||
Estimated Fair Value | $47,426 | $52,096 | ||
[1] | Includes investments classified as cash equivalents on our condensed consolidated balance sheet. | |||
[2] | Includes investments classified as cash equivalents on our consolidated balance sheet. |
Fair_Value_Measurements_Assets
Fair Value Measurements, Assets Measured at Fair Value on a Recurring Basis (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | ||
Fair Value Measurements [Abstract] | ' | ' | ||
Amount of transfer between Level 1 and Level 2 investments | $0 | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Investment in Regulus Therapeutics Inc. | 47,426,000 | 52,096,000 | ||
Interest rate on convertible debt (in hundredths) | 2.75% | 2.75% | ||
2 3/4 percent convertible senior notes [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Interest rate on convertible debt (in hundredths) | 2.75% | ' | ||
Fair value of convertible notes | 490,000,000 | ' | ||
Recurring basis [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Cash equivalents | 44,551,000 | 133,233,000 | ||
Investment in Regulus Therapeutics Inc. | 47,426,000 | 52,096,000 | ||
Total assets | 626,627,000 | 696,517,000 | ||
Recurring basis [Member] | Corporate debt securities [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Available-for-sale securities | 353,848,000 | [1] | 407,897,000 | [1] |
Recurring basis [Member] | Debt securities issued by U.S. government agencies [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Available-for-sale securities | 106,397,000 | [1] | 64,432,000 | |
Recurring basis [Member] | Debt securities issued by the U.S. Treasury [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Available-for-sale securities | 9,040,000 | 15,328,000 | ||
Recurring basis [Member] | Debt securities issued by states of the United States and political subdivisions of the states [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Available-for-sale securities | 64,344,000 | [1] | 22,255,000 | |
Recurring basis [Member] | Equity securities [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Available-for-sale securities | 1,021,000 | [2] | 1,276,000 | [2] |
Recurring basis [Member] | Quoted Prices in Active Markets (Level 1) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Cash equivalents | 44,551,000 | 133,233,000 | ||
Investment in Regulus Therapeutics Inc. | 47,426,000 | 52,096,000 | ||
Total assets | 102,038,000 | 201,933,000 | ||
Recurring basis [Member] | Quoted Prices in Active Markets (Level 1) [Member] | Corporate debt securities [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Available-for-sale securities | 0 | [1] | 0 | [1] |
Recurring basis [Member] | Quoted Prices in Active Markets (Level 1) [Member] | Debt securities issued by U.S. government agencies [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Available-for-sale securities | 0 | [1] | 0 | |
Recurring basis [Member] | Quoted Prices in Active Markets (Level 1) [Member] | Debt securities issued by the U.S. Treasury [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Available-for-sale securities | 9,040,000 | 15,328,000 | ||
Recurring basis [Member] | Quoted Prices in Active Markets (Level 1) [Member] | Debt securities issued by states of the United States and political subdivisions of the states [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Available-for-sale securities | 0 | [1] | 0 | |
Recurring basis [Member] | Quoted Prices in Active Markets (Level 1) [Member] | Equity securities [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Available-for-sale securities | 1,021,000 | [2] | 1,276,000 | [2] |
Recurring basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Cash equivalents | 0 | 0 | ||
Investment in Regulus Therapeutics Inc. | 0 | 0 | ||
Total assets | 524,589,000 | 494,584,000 | ||
Recurring basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | Corporate debt securities [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Available-for-sale securities | 353,848,000 | [1] | 407,897,000 | [1] |
Recurring basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | Debt securities issued by U.S. government agencies [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Available-for-sale securities | 106,397,000 | [1] | 64,432,000 | |
Recurring basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | Debt securities issued by the U.S. Treasury [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Available-for-sale securities | 0 | 0 | ||
Recurring basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | Debt securities issued by states of the United States and political subdivisions of the states [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Available-for-sale securities | 64,344,000 | [1] | 22,255,000 | |
Recurring basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | Equity securities [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Available-for-sale securities | 0 | [2] | 0 | [2] |
Recurring basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Cash equivalents | 0 | 0 | ||
Investment in Regulus Therapeutics Inc. | 0 | 0 | ||
Total assets | 0 | 0 | ||
Recurring basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | Corporate debt securities [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Available-for-sale securities | 0 | [1] | 0 | [1] |
Recurring basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | Debt securities issued by U.S. government agencies [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Available-for-sale securities | 0 | [1] | 0 | |
Recurring basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | Debt securities issued by the U.S. Treasury [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Available-for-sale securities | 0 | 0 | ||
Recurring basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | Debt securities issued by states of the United States and political subdivisions of the states [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Available-for-sale securities | 0 | [1] | 0 | |
Recurring basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | Equity securities [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Available-for-sale securities | $0 | [2] | $0 | [2] |
[1] | Includes investments classified as cash equivalents on our condensed consolidated balance sheet. | |||
[2] | Included in other current assets on our condensed consolidated balance sheet. |
Fair_Value_Measurements_Invest
Fair Value Measurements, Investments Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Details) (Investments Valued Using Level 3 Inputs [Member], USD $) | 9 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2014 |
Investments Valued Using Level 3 Inputs [Member] | ' |
Investments measured at fair value on a recurring basis using significant unobservable inputs (Level 3) [Roll Forward] | ' |
Beginning balance of Level 3 investments | $0 |
Total gain included in accumulated other comprehensive income (loss) | 1,231 |
Transfers out of Level 3 investments | -1,231 |
Ending balance of Level 3 investments | $0 |
Concentration_of_Business_Risk2
Concentration of Business Risk (Details) | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | |
Revenue [Member] | Revenue [Member] | Revenue [Member] | Revenue [Member] | Revenue [Member] | Revenue [Member] | Revenue [Member] | Revenue [Member] | Revenue [Member] | Revenue [Member] | Revenue [Member] | Revenue [Member] | Revenue [Member] | Revenue [Member] | Revenue [Member] | Revenue [Member] | Contract Receivables [Member] | Contract Receivables [Member] | |
Partner A [Member] | Partner A [Member] | Partner A [Member] | Partner A [Member] | Partner B [Member] | Partner B [Member] | Partner B [Member] | Partner B [Member] | Partner C [Member] | Partner C [Member] | Partner C [Member] | Partner C [Member] | Partner D [Member] | Partner D [Member] | Partner D [Member] | Partner D [Member] | Significant Partners [Member] | Significant Partners [Member] | |
Partner | Partner | |||||||||||||||||
Concentration Risk [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration percentage (in hundredths) | 72.00% | 25.00% | 59.00% | 16.00% | 12.00% | 48.00% | 9.00% | 22.00% | 1.00% | 18.00% | 15.00% | 21.00% | 0.00% | 0.00% | 0.00% | 31.00% | 94.00% | 91.00% |
Number of significant partners | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | 3 |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Income Taxes [Abstract] | ' | ' | ' | ' |
Income tax expense (benefit) | $1,398 | ($5,193) | $2 | ($6,437) |
Collaborative_Arrangements_and1
Collaborative Arrangements and Licensing Agreements, AstraZeneca (Details) (USD $) | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 1 Months Ended | 7 Months Ended | 1 Months Ended | 1 Months Ended | 7 Months Ended | 1 Months Ended | 0 Months Ended | 1 Months Ended | 1 Months Ended | |||||||||||||||||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Jun. 30, 2013 | Dec. 31, 2012 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Sep. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2014 | Jun. 30, 2013 | Oct. 31, 2014 | Nov. 07, 2014 | Oct. 31, 2014 | Oct. 31, 2014 | Oct. 31, 2014 | Oct. 31, 2014 | Aug. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | |
AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | AstraZeneca [Member] | |||||
Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Agreement entered into in December 2012 [Member] | Agreement entered into in December 2012 [Member] | Agreement entered into in December 2012 [Member] | Agreement entered into in December 2012 [Member] | Agreement entered into in December 2012 [Member] | Agreement entered into in December 2012 [Member] | Agreement entered into in December 2012 [Member] | Agreement entered into in December 2012 [Member] | Agreement entered into in December 2012 [Member] | Agreement entered into in December 2012 [Member] | Agreement entered into in December 2012 [Member] | Agreement entered into in December 2012 [Member] | Agreement entered into in December 2012 [Member] | Amended Agreement entered into in October 2014 [Member] | Amended Agreement entered into in October 2014 [Member] | Amended Agreement entered into in October 2014 [Member] | Amended Agreement entered into in October 2014 [Member] | Amended Agreement entered into in October 2014 [Member] | Amended Agreement entered into in October 2014 [Member] | Agreement entered into in August 2013 [Member] | Agreement entered into in August 2013 [Member] | Agreement entered into in August 2013 [Member] | Agreement entered into in August 2013 [Member] | Agreement entered into in August 2013 [Member] | |||||
Target | Maximum [Member] | Pre-specified events [Member] | Development milestones [Member] | Regulatory milestones [Member] | ISIS-AR [Member] | ISIS-AR [Member] | ISIS-AR [Member] | Three drugs [Member] | ISIS-STAT3 License [Member] | ISIS-STAT3 License [Member] | ISIS-STAT3 License [Member] | ISIS-STAT3 License [Member] | ISIS-STAT3 License [Member] | ISIS-STAT3 License [Member] | ISIS-STAT3 License [Member] | ISIS-STAT3 License [Member] | License fee and substantive milestones [Member] | Research and development milestones [Member] | Regulatory milestones [Member] | |||||||||||||
Drug | Drug | Subsequent Event [Member] | Advancement in Patients with Advanced Cancers [Member] | Advancement in Patients with Advanced Cancers [Member] | Phase 2 [Member] | Development milestones [Member] | Regulatory milestones [Member] | |||||||||||||||||||||||||
Payment | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | ||||||||||||||||||||||||||||
Collaborative Arrangement and Licensing Agreement [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of targets | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of drugs the collaborative partner may license under a separate research program | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3 | ' | ' | ' | ' | ' | ' | 3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Upfront and near-term payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | $31,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Upfront fee received | ' | ' | ' | ' | ' | ' | ' | ' | 6,000,000 | 25,000,000 | 31,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenue earned | 44,063,000 | 23,585,000 | 129,300,000 | 105,036,000 | 627,000 | 4,200,000 | 19,700,000 | 22,000,000 | ' | ' | 11,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred revenue | ' | ' | ' | ' | 4,800,000 | ' | 4,800,000 | ' | 19,500,000 | ' | 19,500,000 | ' | ' | ' | ' | ' | ' | 11,200,000 | 7,600,000 | ' | 700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Milestone payment earned | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 15,000,000 | ' | ' | ' | ' | ' | ' | 7,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of milestone payments to be earned | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Milestone payments to be earned | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 15,000,000 | ' | 7,500,000 | 10,000,000 | ' | ' | ' | ' | ' | ' | ' |
Maximum amount of payment receivable | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 865,000,000 | 238,000,000 | 620,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 70,000,000 | 170,000,000 | ' | ' | 163,200,000 | 45,300,000 | 105,000,000 |
Cumulative milestone payments earned under collaborative arrangement at period end | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Next prospective milestone | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | 3,300,000 | ' | ' | ' |
Upfront fee recorded as deferred revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $19,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $750,000 | ' | ' | ' | ' |
Percent of total revenue (in hundredths) | ' | ' | ' | ' | 1.00% | ' | 15.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Collaborative_Arrangements_and2
Collaborative Arrangements and Licensing Agreements, Biogen Idec (ISIS-SMN) (Details) (Biogen Idec [Member], USD $) | 9 Months Ended | 3 Months Ended | 9 Months Ended | 1 Months Ended | ||||||
Sep. 30, 2014 | Jan. 31, 2014 | Sep. 30, 2014 | Jan. 31, 2014 | Jan. 31, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Jan. 31, 2012 | |
ISIS-SMN [Member] | ISIS-SMN [Member] | ISIS-SMN [Member] | ISIS-SMN [Member] | ISIS-SMN [Member] | ISIS-SMN [Member] | ISIS-SMN [Member] | ISIS-SMN [Member] | Collaborations and Licensing Agreements [Member] | Agreement entered into in January 2012 [Member] | |
Phase 3 [Member] | Phase 2 [Member] | Open-label extension [Member] | License fee and substantive milestones [Member] | Development milestones [Member] | Regulatory milestones [Member] | Agreement | ISIS-SMN [Member] | |||
Collaborative Arrangement and Licensing Agreement [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of collaborative agreements | ' | ' | ' | ' | ' | ' | ' | ' | 4 | ' |
Upfront fee recorded as deferred revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | $29,000,000 |
Increase in payments that the Company is eligible to receive under collaboration | 57,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Milestone payment earned | ' | ' | 18,000,000 | ' | ' | ' | ' | ' | ' | ' |
Cumulative milestone payments received under collaborative arrangement at period end | 37,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Payment received related to the amendment of clinical development plan | 11,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred revenue | ' | 11,300,000 | ' | 3,800,000 | 7,500,000 | ' | ' | ' | 127,400,000 | ' |
Maximum amount of payment receivable | ' | ' | ' | ' | ' | 327,200,000 | 102,200,000 | 150,000,000 | ' | ' |
Next prospective milestone | $27,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Collaborative_Arrangements_and3
Collaborative Arrangements and Licensing Agreements, Biogen Idec (ISIS-DMPK) (Details) (Biogen Idec [Member], Agreement entered into in June 2012 [Member], ISIS-DMPK [Member], USD $) | 1 Months Ended | ||
Jun. 30, 2014 | Jun. 30, 2012 | Sep. 30, 2014 | |
Collaborative Arrangement and Licensing Agreement [Abstract] | ' | ' | ' |
Upfront fee recorded as deferred revenue | ' | $12,000,000 | ' |
Milestone payment earned | 14,000,000 | ' | ' |
Next prospective milestone | ' | ' | 35,000,000 |
License fee and substantive milestones [Member] | ' | ' | ' |
Collaborative Arrangement and Licensing Agreement [Abstract] | ' | ' | ' |
Maximum amount of payment receivable | ' | ' | 259,000,000 |
Cumulative milestone payments earned under collaborative arrangement at period end | ' | ' | 24,000,000 |
Development milestones [Member] | ' | ' | ' |
Collaborative Arrangement and Licensing Agreement [Abstract] | ' | ' | ' |
Maximum amount of payment receivable | ' | ' | 35,000,000 |
Regulatory milestones [Member] | ' | ' | ' |
Collaborative Arrangement and Licensing Agreement [Abstract] | ' | ' | ' |
Maximum amount of payment receivable | ' | ' | $130,000,000 |
Collaborative_Arrangements_and4
Collaborative Arrangements and Licensing Agreements, Biogen Idec (Neurology) (Details) (Biogen Idec [Member], Agreement entered into in December 2012 [Member], Neurology [Member], USD $) | 1 Months Ended | |
Dec. 31, 2012 | Sep. 30, 2014 | |
Target | ||
Collaborative Arrangement and Licensing Agreement [Abstract] | ' | ' |
Number of targets | 3 | ' |
Upfront fee recorded as deferred revenue | $30,000,000 | ' |
Next prospective milestone | ' | 10,000,000 |
License fee and substantive milestones [Member] | ' | ' |
Collaborative Arrangement and Licensing Agreement [Abstract] | ' | ' |
Maximum amount of payment receivable | ' | 259,000,000 |
Development milestones [Member] | ' | ' |
Collaborative Arrangement and Licensing Agreement [Abstract] | ' | ' |
Maximum amount of payment receivable | ' | 59,000,000 |
Regulatory milestones [Member] | ' | ' |
Collaborative Arrangement and Licensing Agreement [Abstract] | ' | ' |
Maximum amount of payment receivable | ' | $130,000,000 |
Collaborative_Arrangements_and5
Collaborative Arrangements and Licensing Agreements, Biogen Idec (Strategic Neurology) (Details) (USD $) | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 1 Months Ended | 0 Months Ended | |||||||||||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Jun. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Nov. 07, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | |
Biogen Idec [Member] | Biogen Idec [Member] | Biogen Idec [Member] | Biogen Idec [Member] | Biogen Idec [Member] | Biogen Idec [Member] | Biogen Idec [Member] | Biogen Idec [Member] | Biogen Idec [Member] | Biogen Idec [Member] | Biogen Idec [Member] | Biogen Idec [Member] | Biogen Idec [Member] | Biogen Idec [Member] | Biogen Idec [Member] | |||||
Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Agreement entered into in September 2013 [Member] | Agreement entered into in September 2013 [Member] | Agreement entered into in September 2013 [Member] | Agreement entered into in September 2013 [Member] | Agreement entered into in September 2013 [Member] | Agreement entered into in September 2013 [Member] | Agreement entered into in September 2013 [Member] | Agreement entered into in September 2013 [Member] | Agreement entered into in September 2013 [Member] | Agreement entered into in September 2013 [Member] | |||||
Strategic Neurology [Member] | Strategic Neurology [Member] | Strategic Neurology [Member] | Strategic Neurology [Member] | Strategic Neurology [Member] | Strategic Neurology [Member] | Strategic Neurology [Member] | Strategic Neurology [Member] | Strategic Neurology [Member] | Strategic Neurology [Member] | Strategic Neurology [Member] | |||||||||
Subsequent Event [Member] | Antisense drug for neurological disease [Member] | Antisense drug for neurological disease [Member] | Antisense drug for neurological disease [Member] | Other modalities [Member] | Other modalities [Member] | Other modalities [Member] | |||||||||||||
License fee and substantive milestones [Member] | Research and development milestones [Member] | Regulatory milestones [Member] | Pre-specified events [Member] | Research and development milestones [Member] | Regulatory milestones [Member] | ||||||||||||||
Collaborative Arrangement and Licensing Agreement [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Period of exclusive rights to use antisense technology | ' | ' | ' | ' | ' | ' | ' | ' | '6 years | ' | '6 years | ' | ' | ' | ' | ' | ' | ' | ' |
Upfront fee recorded as deferred revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $100,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Period during which a change in control could result in requirement to refund upfront payment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '6 years | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum amount of payments receivable per drug under strategic alliance | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 260,000,000 | ' | ' | ' | ' | ' |
Maximum amount of payment receivable per drug | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 60,000,000 | 130,000,000 | 90,000,000 | 35,000,000 | 55,000,000 |
Milestone payment earned | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,000,000 | ' | ' | 10,000,000 | ' | ' | ' | ' | ' | ' |
Next prospective milestone | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,000,000 | ' | ' | ' | ' | ' | ' | ' |
Revenue earned | 44,063,000 | 23,585,000 | 129,300,000 | 105,036,000 | 31,700,000 | 5,900,000 | 76,400,000 | 17,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percent of total revenue (in hundredths) | ' | ' | ' | ' | 72.00% | ' | 59.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred revenue | ' | ' | ' | ' | $127,400,000 | ' | $127,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Collaborative_Arrangements_and6
Collaborative Arrangements and Licensing Agreements, GlaxoSmithKline (Details) (USD $) | 3 Months Ended | 9 Months Ended | 1 Months Ended | 3 Months Ended | 9 Months Ended | 1 Months Ended | 1 Months Ended | 1 Months Ended | 1 Months Ended | 1 Months Ended | 9 Months Ended | 0 Months Ended | |||||||||||||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | 31-May-11 | Mar. 31, 2010 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Mar. 31, 2010 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Dec. 31, 2012 | Sep. 30, 2014 | Oct. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Nov. 07, 2014 | Nov. 07, 2014 | Sep. 30, 2014 | |
Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | Glaxo Smith Kline [Member] | |||||
Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaboration and Licensing Agreement - Upfront Fees and Other Payments [Member] | |||||
Program | Maximum [Member] | Pre-specified events [Member] | Development milestones [Member] | Regulatory milestones [Member] | Commercialization milestones [Member] | ISIS-TTR [Member] | ISIS-TTR [Member] | ISIS-TTR [Member] | ISIS-TTR [Member] | ISIS-HBV [Member] | ISIS-HBV [Member] | ISIS-HBV [Member] | ISIS-GSK4 [Member] | ISIS-GSK4 [Member] | ISIS-GSK5 [Member] | ISIS-GSK4 and ISIS-GSK5 [Member] | |||||||||||
Program | Subsequent Event [Member] | Research and development milestones [Member] | Pre-specified events [Member] | Subsequent Event [Member] | |||||||||||||||||||||||
Phase 2/3 Study [Member] | |||||||||||||||||||||||||||
Collaborative Arrangement and Licensing Agreement [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of programs under which drugs are to be developed | ' | ' | ' | ' | ' | ' | ' | ' | 5 | ' | 6 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Upfront fee received | ' | ' | ' | ' | ' | $35,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | $2,500,000 | ' | ' | ' | $1,000,000 | ' | ' | ' | ' | ' | ' | ' |
Milestone payment earned | ' | ' | ' | ' | 3,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 18,000,000 | ' | ' | ' | ' | 1,500,000 | 6,500,000 | 5,000,000 | ' | ' |
Maximum milestone payments through Phase 2 proof of concept for each program, except TTR and the 5th target | ' | ' | ' | ' | ' | 20,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cumulative milestone payments earned under collaborative arrangement at period end | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 27,000,000 | ' | ' | ' | 10,000,000 | ' | ' | ' | ' | 11,500,000 | ' |
Maximum amount of payment receivable | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,200,000,000 | 147,500,000 | 483,500,000 | 428,000,000 | ' | ' | ' | 25,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Next prospective milestone | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,000,000 | ' | ' | ' | ' | ' |
Revenue earned | 44,063,000 | 23,585,000 | 129,300,000 | 105,036,000 | ' | ' | 5,100,000 | 11,300,000 | 11,900,000 | 23,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percent of total revenue (in hundredths) | ' | ' | ' | ' | ' | ' | 12.00% | ' | 9.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred revenue | ' | ' | ' | ' | ' | ' | $11,100,000 | ' | $11,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $9,000,000 |
Collaborative_Arrangements_and7
Collaborative Arrangements and Licensing Agreements, Roche (Details) (USD $) | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 1 Months Ended | 9 Months Ended | |||||||||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Apr. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | |
Roche [Member] | Roche [Member] | Roche [Member] | Roche [Member] | Roche [Member] | Roche [Member] | Roche [Member] | Roche [Member] | Roche [Member] | Roche [Member] | Roche [Member] | Roche [Member] | Roche [Member] | |||||
Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Agreement entered into in April 2013 [Member] | Agreement entered into in April 2013 [Member] | Agreement entered into in April 2013 [Member] | Agreement entered into in April 2013 [Member] | Agreement entered into in April 2013 [Member] | Agreement entered into in April 2013 [Member] | Agreement entered into in April 2013 [Member] | Agreement entered into in April 2013 [Member] | Agreement entered into in April 2013 [Member] | |||||
Development, regulatory and commercial milestones [Member] | HTT [Member] | HTT [Member] | HTT [Member] | HTT [Member] | Brain Shuttle [Member] | Brain Shuttle [Member] | |||||||||||
License fee and substantive milestones [Member] | Development milestones [Member] | Regulatory milestones [Member] | Commercialization milestones [Member] | Candidate | Commercialization milestones [Member] | ||||||||||||
Collaborative Arrangement and Licensing Agreement [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Upfront fee recorded as deferred revenue | ' | ' | ' | ' | ' | ' | ' | ' | $30,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum amount of payment receivable | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 362,000,000 | 67,000,000 | 170,000,000 | 80,000,000 | ' | 50,000,000 |
Maximum amount of payment receivable per drug | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 136,500,000 | ' | ' | ' | ' | ' | ' |
Next prospective milestone | ' | ' | ' | ' | ' | ' | ' | ' | ' | 22,000,000 | ' | ' | ' | ' | ' | ' | ' |
Number of development candidates that must be generated for brain shuttle program | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' |
Revenue earned | 44,063,000 | 23,585,000 | 129,300,000 | 105,036,000 | 2,300,000 | 1,900,000 | 6,700,000 | 3,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred revenue | ' | ' | ' | ' | $19,000,000 | ' | $19,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Collaborative_Arrangements_and8
Collaborative Arrangements and Licensing Agreements, Achaogen, Inc. (Details) (Achaogen Inc [Member], Collaborations and Licensing Agreements [Member], USD $) | 1 Months Ended | 9 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2014 | Sep. 30, 2014 | Mar. 31, 2014 | Sep. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2006 | Sep. 30, 2014 | |
Drug | Maximum [Member] | Maximum [Member] | Series A preferred stock [Member] | Pre-specified events [Member] | |||
Collaborative Arrangement and Licensing Agreement [Abstract] | ' | ' | ' | ' | ' | ' | ' |
Upfront fee in the form of equity securities | ' | ' | ' | ' | ' | $1,500,000 | ' |
Cumulative milestone payments earned under collaborative arrangement at period end | ' | ' | ' | ' | ' | ' | 7,000,000 |
Milestone payment earned | 4,000,000 | ' | ' | ' | ' | ' | ' |
Number of drugs to be developed and commercialized | ' | 2 | ' | ' | ' | ' | ' |
Maximum amount of payment receivable | ' | ' | ' | ' | ' | ' | 42,300,000 |
Next prospective milestone | 7,500,000 | 7,500,000 | ' | ' | ' | ' | ' |
Number of shares held after conversion (in shares) | ' | ' | 148,000 | ' | ' | ' | ' |
Fair value of investment in Achaogen, Inc | $1,000,000 | $1,000,000 | ' | ' | ' | ' | ' |
Ownership interest percentage (in hundredths) | ' | ' | ' | 10.00% | 10.00% | ' | ' |
Collaborative_Arrangements_and9
Collaborative Arrangements and Licensing Agreements, Alnylam Pharmaceuticals, Inc. (Details) (USD $) | 3 Months Ended | 9 Months Ended | 1 Months Ended | 9 Months Ended | 127 Months Ended | 12 Months Ended | 3 Months Ended | ||||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Mar. 31, 2004 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Mar. 31, 2014 | |
Alnylam [Member] | Alnylam [Member] | Alnylam [Member] | Alnylam [Member] | Alnylam [Member] | Alnylam [Member] | Alnylam [Member] | Alnylam [Member] | Alnylam [Member] | |||||
Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Collaborations and Licensing Agreements [Member] | Alnylam's collaboration with Genzyme [Member] | |||||
Phase 3 [Member] | Pre-specified events [Member] | Development milestones [Member] | Regulatory milestones [Member] | ||||||||||
Collaborative Arrangement and Licensing Agreement [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Upfront fee received | ' | ' | ' | ' | $5,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum amount of payments receivable per drug under strategic alliance | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,400,000 | 1,100,000 | 2,300,000 | ' |
Milestone payment earned | ' | ' | ' | ' | ' | ' | ' | ' | 750,000 | ' | ' | ' | ' |
Next prospective milestone | ' | ' | ' | ' | ' | 375,000 | ' | 375,000 | ' | ' | ' | ' | ' |
Potential payments for drug development | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,400,000 | ' | ' | ' |
Revenue earned | $44,063,000 | $23,585,000 | $129,300,000 | $105,036,000 | ' | $7,700,000 | $400,000 | $48,200,000 | ' | ' | ' | ' | $7,700,000 |
Subsequent_Events_Details
Subsequent Events (Details) (Subsequent Event [Member], Regulus [Member], USD $) | 0 Months Ended |
In Millions, except Share data, unless otherwise specified | Nov. 07, 2014 |
Subsequent Event [Member] | Regulus [Member] | ' |
Public Offering by Regulus [Abstract] | ' |
Number of shares of common stock sold (in shares) | 1,279,411 |
Total proceeds from sale of common stock | $20.40 |
Gain from sale of common stock | $17.80 |