Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
In Billions, except Share data, unless otherwise specified | Dec. 31, 2013 | Feb. 05, 2014 | Jun. 30, 2013 |
Document and Entity Information [Abstract] | ' | ' | ' |
Entity Registrant Name | 'VERTEX PHARMACEUTICALS INC / MA | ' | ' |
Entity Central Index Key | '0000875320 | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Filer Category | 'Large Accelerated Filer | ' | ' |
Document Type | '10-K | ' | ' |
Document Period End Date | 31-Dec-13 | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Amendment Flag | 'false | ' | ' |
Entity Public Float | ' | ' | $18.50 |
Entity Common Stock, Shares Outstanding (shares) | ' | 235,771,942 | ' |
Entity Well-known Seasoned Issuer | 'Yes | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Revenues: | ' | ' | ' |
Product revenues, net | $837,645 | $1,333,458 | $950,889 |
Royalty revenues | 156,592 | 141,498 | 50,015 |
Collaborative revenues (1) | 217,738 | 52,086 | 409,722 |
Total revenues | 1,211,975 | 1,527,042 | 1,410,626 |
Costs and expenses: | ' | ' | ' |
Cost of product revenues | 88,979 | 236,742 | 63,625 |
Royalty expenses | 41,298 | 43,143 | 16,880 |
Research and development expenses | 918,783 | 806,185 | 707,706 |
Sales, general and administrative expenses | 362,342 | 436,796 | 400,721 |
Restructuring Expense | 40,521 | 1,844 | 2,074 |
Intangible asset impairment charges | 663,500 | 0 | 105,800 |
Total costs and expenses | 2,115,423 | 1,524,710 | 1,296,806 |
Income (loss) from operations | -903,448 | 2,332 | 113,820 |
Interest Income (Expense), Net | -22,730 | -15,022 | -37,681 |
Other Nonoperating Income (Expense) | -49,939 | 309 | -15,694 |
Income (loss) before provision for (benefit from) income taxes | -976,117 | -12,381 | 60,445 |
Provision for (benefit from) income taxes | -288,567 | 38,754 | 19,266 |
Net income (loss) | -687,550 | -51,135 | 41,179 |
Net loss (income) attributable to noncontrolling interest (Alios) | 242,522 | -55,897 | -11,605 |
Comprehensive (Income) Loss, Net of Tax, Attributable to Noncontrolling Interest | -242,522 | 55,897 | 11,605 |
Net income (loss) attributable to Vertex | ($445,028) | ($107,032) | $29,574 |
Net income (loss) per share attributable to Vertex common shareholders: | ' | ' | ' |
Basic (usd per share) | ($1.98) | ($0.50) | $0.14 |
Diluted (usd per share) | ($1.98) | ($0.50) | $0.14 |
Shares used in per share calculations: | ' | ' | ' |
Basic (shares) | 224,906 | 211,946 | 204,891 |
Diluted (shares) | 224,906 | 211,946 | 208,807 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (Loss) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest [Abstract] | ' | ' | ' |
Net income (loss) | ($687,550) | ($51,135) | $41,179 |
Changes in other comprehensive income (loss): | ' | ' | ' |
Unrealized holding gains (losses) on marketable securities | -154 | 305 | -119 |
Unrealized losses on foreign currency forward contracts | -23 | 0 | 0 |
Foreign currency translation adjustment | 421 | 198 | 133 |
Total changes in other comprehensive income (loss) | 244 | 503 | 14 |
Comprehensive income (loss) | -687,306 | -50,632 | 41,193 |
Comprehensive loss (income) attributable to noncontrolling interest (Alios) | 242,522 | -55,897 | -11,605 |
Comprehensive income (loss) attributable to Vertex | ($444,784) | ($106,529) | $29,588 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | ||
In Thousands, unless otherwise specified | ||||
Current assets: | ' | ' | ||
Cash and cash equivalents | $569,299 | [1] | $489,407 | [1] |
Marketable securities, available for sale | 895,777 | [1] | 831,808 | [1] |
Restricted cash and cash equivalents (Alios) | 0 | [1] | 69,983 | [1] |
Accounts receivable, net | 85,517 | [1] | 143,250 | [1] |
Inventories | 14,147 | [1] | 30,464 | [1] |
Prepaid expenses and other current assets | 23,836 | [1] | 24,673 | [1] |
Total current assets | 1,588,576 | [1] | 1,589,585 | [1] |
Restricted cash | 130 | [1] | 31,934 | [1] |
Property and equipment, net | 696,911 | [1] | 433,609 | [1] |
Intangible assets | 0 | [1] | 663,500 | [1] |
Goodwill | 30,992 | [1] | 30,992 | [1] |
Other assets | 2,432 | [1] | 9,668 | [1] |
Total assets | 2,319,041 | [1] | 2,759,288 | [1] |
Current liabilities: | ' | ' | ||
Accounts payable | 49,327 | [1] | 101,292 | [1] |
Accrued expenses | 271,077 | [1] | 264,884 | [1] |
Deferred revenues, current portion | 21,510 | [1] | 27,566 | [1] |
Accrued restructuring expense, current portion | 14,286 | [1] | 4,758 | [1] |
Capital lease obligations, current portion | 16,893 | 13,707 | ||
Income taxes payable (Alios) | 0 | [1] | 715 | [1] |
Other liabilities, current portion | 24,736 | [1] | 19,702 | [1] |
Total current liabilities | 397,829 | [1] | 432,624 | [1] |
Deferred revenues, excluding current portion | 49,459 | [1] | 96,242 | [1] |
Accrued restructuring expense, excluding current portion | 14,067 | [1] | 18,570 | [1] |
Capital lease obligations, excluding current portion | 48,754 | 15,170 | ||
Convertible senior subordinated notes (due 2015) | 0 | [1] | 400,000 | [1] |
Deferred tax liability | 0 | [1] | 280,367 | [1] |
Construction financing lease obligation | 440,937 | [1] | 268,031 | [1] |
Other liabilities, excluding current portion | 11,590 | [1] | 13,902 | [1] |
Total liabilities | 962,636 | [1] | 1,524,906 | [1] |
Commitments and contingencies (Note T and Note V) | ' | [1] | ' | [1] |
Redeemable noncontrolling interest (Alios) | 0 | [1] | 38,530 | [1] |
Shareholders’ equity: | ' | ' | ||
Preferred stock, $0.01 par value; 1,000,000 shares authorized; none issued and outstanding at December 31, 2013 and 2012 | 0 | [1] | 0 | [1] |
Common stock, $0.01 par value; 300,000,000 shares authorized at December 31, 2013 and 2012; 233,788,852 and 217,286,868 shares issued and outstanding at December 31, 2013 and 2012, respectively | 2,320 | [1] | 2,149 | [1] |
Additional paid-in capital | 5,321,286 | [1] | 4,519,448 | [1] |
Accumulated other comprehensive loss | -306 | [1] | -550 | [1] |
Accumulated deficit | -3,966,895 | [1] | -3,521,867 | [1] |
Total Vertex shareholders’ equity | 1,356,405 | [1] | 999,180 | [1] |
Noncontrolling interest (Alios) | 0 | [1] | 196,672 | [1] |
Total shareholders’ equity | 1,356,405 | [1] | 1,195,852 | [1] |
Total liabilities and shareholders’ equity | $2,319,041 | [1] | $2,759,288 | [1] |
[1] | Amounts as of December 31, 2012 include the assets and liabilities of Vertex’s variable interest entity (“VIEâ€), Alios BioPharma, Inc. (“Aliosâ€). The Company deconsolidated Alios as of December 31, 2013. Vertex’s interests and obligations with respect to the VIE’s assets and liabilities are limited to those accorded to Vertex in its agreement with Alios. See Note B, "Collaborative Arrangements," to these consolidated financial statements for amounts. |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Statement of Financial Position [Abstract] | ' | ' |
Preferred stock, par value (usd per share) | $0.01 | $0.01 |
Preferred stock, shares authorized (shares) | 1,000,000 | 1,000,000 |
Preferred stock, shares issued (shares) | 0 | 0 |
Preferred stock, shares outstanding (shares) | 0 | 0 |
Common stock, par value (usd per share) | $0.01 | $0.01 |
Common stock, shares authorized (shares) | 300,000,000 | 300,000,000 |
Common stock, shares issued (shares) | 233,788,852 | 217,286,868 |
Common stock, shares outstanding (shares) | 233,788,852 | 217,286,868 |
Consolidated_Statements_of_Sha
Consolidated Statements of Shareholders' Equity and Noncontrolling Interest (USD $) | Total | Total Vertex Shareholders' Equity | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit | Noncontrolling Interest (Alios) | Redeemable Noncontrolling Interest (Alios) | |
In Thousands, except Share data, unless otherwise specified | |||||||||
Balance at Dec. 31, 2010 | $503,973 | $503,973 | $2,016 | $3,947,433 | ($1,067) | ($3,444,409) | $0 | $0 | |
Balance (shares) at Dec. 31, 2010 | ' | ' | 203,523,000 | ' | ' | ' | ' | ' | |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' | ' | ' | ' | |
Unrealized holding losses on marketable securities | -119 | -119 | ' | ' | -119 | ' | ' | ' | |
Unrealized losses on foreign currency forward contracts | 0 | ' | ' | ' | ' | ' | ' | ' | |
Foreign currency translation adjustment | 133 | 133 | ' | ' | 133 | ' | ' | ' | |
Net income (loss) attributable to Vertex common shareholders | 29,574 | ' | ' | ' | ' | ' | ' | ' | |
Net income (loss) | 41,179 | 29,574 | ' | ' | ' | ' | 11,605 | ' | |
Issuances of common stock: | ' | ' | ' | ' | ' | ' | ' | ' | |
Benefit plans (shares) | 183,000 | ' | 5,781,000 | ' | ' | ' | ' | ' | |
Issuance of common stock under benefit plans | 133,393 | 133,418 | 56 | 133,362 | ' | ' | -25 | ' | |
Stock-based compensation expense | 119,268 | 118,964 | ' | 118,964 | ' | ' | 304 | ' | |
Tax benefit from equity compensation | 900 | ' | ' | 900 | ' | ' | ' | ' | |
Alios noncontrolling interest upon consolidation | 130,486 | ' | ' | ' | ' | ' | 130,486 | 36,299 | |
Change in liquidation value of noncontrolling interest | -737 | ' | ' | ' | ' | ' | -737 | -737 | |
Balance at Dec. 31, 2011 | 928,476 | 786,843 | 2,072 | 4,200,659 | -1,053 | -3,414,835 | 141,633 | 37,036 | |
Balance (shares) at Dec. 31, 2011 | ' | ' | 209,304,000 | ' | ' | ' | ' | ' | |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' | ' | ' | ' | |
Unrealized holding losses on marketable securities | 305 | 305 | ' | ' | 305 | ' | ' | ' | |
Unrealized losses on foreign currency forward contracts | 0 | ' | ' | ' | ' | ' | ' | ' | |
Foreign currency translation adjustment | 198 | 198 | ' | ' | 198 | ' | ' | ' | |
Net income (loss) attributable to Vertex common shareholders | -107,032 | ' | ' | ' | ' | -107,032 | ' | ' | |
Net income (loss) | -51,135 | -107,032 | ' | ' | ' | ' | 55,897 | ' | |
Issuances of common stock: | ' | ' | ' | ' | ' | ' | ' | ' | |
Benefit plans (shares) | 242,000 | ' | 7,983,000 | ' | ' | ' | ' | ' | |
Issuance of common stock under benefit plans | 201,992 | 201,837 | 77 | 201,760 | ' | ' | 155 | ' | |
Stock-based compensation expense | 115,539 | 115,058 | ' | 115,058 | ' | ' | 481 | ' | |
Tax benefit from equity compensation | 1,971 | 1,971 | ' | 1,971 | ' | ' | ' | ' | |
Change in liquidation value of noncontrolling interest | -1,494 | ' | ' | ' | ' | ' | -1,494 | -1,494 | |
Balance at Dec. 31, 2012 | 1,195,852 | [1] | 999,180 | 2,149 | 4,519,448 | -550 | -3,521,867 | 196,672 | 38,530 |
Balance (shares) at Dec. 31, 2012 | ' | ' | 217,287,000 | ' | ' | ' | ' | ' | |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' | ' | ' | ' | |
Unrealized holding losses on marketable securities | -154 | -154 | ' | ' | -154 | ' | ' | ' | |
Unrealized losses on foreign currency forward contracts | -23 | -23 | ' | ' | -23 | ' | ' | ' | |
Foreign currency translation adjustment | 421 | 421 | ' | ' | 421 | ' | ' | ' | |
Net income (loss) attributable to Vertex common shareholders | -445,028 | ' | ' | ' | ' | ' | ' | ' | |
Net income (loss) | -687,550 | -445,028 | ' | ' | ' | ' | -242,522 | ' | |
Issuances of common stock: | ' | ' | ' | ' | ' | ' | ' | ' | |
Benefit plans (shares) | 99,000 | ' | 8,226,000 | ' | ' | ' | ' | ' | |
Issuance of common stock under benefit plans | 271,738 | 271,801 | 88 | 271,713 | ' | ' | -63 | ' | |
Convertible senior subordinated notes (due 2015) conversion (shares) | ' | ' | 8,276,000 | ' | ' | ' | ' | ' | |
Convertible senior subordinated notes (due 2015) conversion | 402,265 | 402,265 | 83 | 402,182 | ' | ' | ' | ' | |
Stock-based compensation expense | 128,351 | 127,883 | ' | 127,883 | ' | ' | 468 | ' | |
Employee Service Share-Based Compensation, Restructuring Expenses | 1,312 | 1,312 | ' | 1,312 | ' | ' | ' | ' | |
Tax benefit from equity compensation | -1,252 | -1,252 | ' | -1,252 | ' | ' | ' | ' | |
Alios noncontrolling interest upon deconsolidation | 45,445 | ' | ' | ' | ' | ' | 45,445 | 38,530 | |
Balance at Dec. 31, 2013 | $1,356,405 | [1] | $1,356,405 | $2,320 | $5,321,286 | ($306) | ($3,966,895) | $0 | $0 |
Balance (shares) at Dec. 31, 2013 | ' | ' | 233,789,000 | ' | ' | ' | ' | ' | |
[1] | Amounts as of December 31, 2012 include the assets and liabilities of Vertex’s variable interest entity (“VIEâ€), Alios BioPharma, Inc. (“Aliosâ€). The Company deconsolidated Alios as of December 31, 2013. Vertex’s interests and obligations with respect to the VIE’s assets and liabilities are limited to those accorded to Vertex in its agreement with Alios. See Note B, "Collaborative Arrangements," to these consolidated financial statements for amounts. |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | ||
Cash flows from operating activities: | ' | ' | ' | ||
Net income (loss) | ($687,550) | ($51,135) | $41,179 | ||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ' | ' | ' | ||
Depreciation and amortization expense | 48,365 | 38,191 | 35,041 | ||
Stock-based compensation expense | 127,303 | 114,285 | 118,226 | ||
Other non-cash based compensation expense | 5,860 | 10,261 | 8,525 | ||
Intangible asset impairment charges | 663,500 | 0 | 105,800 | ||
Secured notes (due 2012) discount amortization expense | 0 | 0 | 18,409 | ||
Change in fair value of free-standing derivatives related to the sale of milestone payments | 0 | 0 | 16,801 | ||
Deferred income taxes | -285,053 | 36,660 | -7,501 | ||
Non-cash Expense | 7,594 | 0 | 0 | ||
Deconsolidation of variable interest entity (Alios) | 55,110 | 0 | 0 | ||
Write-downs of inventories to net realizable value | 10,358 | 133,189 | 0 | ||
Excess tax benefit from share-based payment arrangements | 1,252 | -1,971 | -900 | ||
Other non-cash items, net | 6,742 | 178 | 319 | ||
Changes in operating assets and liabilities, excluding the effects of the acquisition and deconsolidation of a variable interest entity (Alios): | ' | ' | ' | ||
Accounts receivable, net | 53,363 | 39,912 | -170,606 | ||
Inventories | 7,142 | -29,925 | -111,388 | ||
Prepaid expenses and other current assets | -12,061 | -23,619 | 10,358 | ||
Accounts payable | -49,234 | 14,892 | 37,468 | ||
Accrued expenses and other liabilities | 43,725 | 29,232 | 116,822 | ||
Accrued restructuring expense | 5,025 | -2,985 | -3,282 | ||
Deferred revenues | -53,011 | -39,324 | -71,536 | ||
Net cash provided by (used in) operating activities | -51,570 | 267,841 | 143,735 | ||
Cash flows from investing activities: | ' | ' | ' | ||
Purchases of marketable securities | -2,412,418 | -1,705,829 | -721,545 | ||
Sales and maturities of marketable securities | 2,348,295 | 1,367,927 | 1,016,040 | ||
Payment for acquisition of variable interest entity (Alios) | 0 | 0 | -60,000 | ||
Expenditures for property and equipment | -51,393 | -71,140 | -34,595 | ||
Decrease in restricted cash and cash equivalents | 31,804 | 2,156 | 0 | ||
Decrease (increase) in restricted cash and cash equivalents (Alios) | 27,884 | -18,105 | 12,695 | ||
Decrease (increase) in other assets | 1,698 | -826 | -183 | ||
Net cash provided by (used in) investing activities | -54,130 | -425,817 | 212,412 | ||
Cash flows from financing activities: | ' | ' | ' | ||
Excess tax benefit from share-based payment arrangements | -1,252 | 1,971 | 900 | ||
Issuances of common stock under benefit plans | 265,878 | 191,721 | 124,862 | ||
Payments to redeem secured notes | -158 | 0 | -155,000 | ||
Settlement of milestone derivatives | 0 | 0 | -95,000 | ||
Payments on capital lease obligations | -16,057 | -2,615 | 0 | ||
Payments on construction financing lease obligation | -67,527 | -18,873 | 0 | ||
Net cash provided by (used in) financing activities | 180,884 | 172,204 | -124,238 | ||
Effect of changes in exchange rates on cash | 4,708 | -141 | 214 | ||
Net increase in cash and cash equivalents | 79,892 | 14,087 | 232,123 | ||
Cash and cash equivalents—beginning of period | 489,407 | [1] | 475,320 | 243,197 | |
Cash and cash equivalents—end of period | 569,299 | [1] | 489,407 | [1] | 475,320 |
Supplemental disclosure of cash flow information: | ' | ' | ' | ||
Cash paid for interest | 11,015 | 13,400 | 13,512 | ||
Cash paid for income taxes | 2,840 | 9,318 | 0 | ||
Conversion of convertible senior subordinated notes (due 2015) for common stock | 399,842 | 0 | 0 | ||
Capitalization of construction in-process related to construction financing lease obligation | 215,013 | 235,594 | 54,655 | ||
Assets acquired under capital lease obligations | 50,972 | 30,101 | 0 | ||
Unamortized deferred debt issuance costs exchanged | $4,230 | $0 | $0 | ||
[1] | Amounts as of December 31, 2012 include the assets and liabilities of Vertex’s variable interest entity (“VIEâ€), Alios BioPharma, Inc. (“Aliosâ€). The Company deconsolidated Alios as of December 31, 2013. Vertex’s interests and obligations with respect to the VIE’s assets and liabilities are limited to those accorded to Vertex in its agreement with Alios. See Note B, "Collaborative Arrangements," to these consolidated financial statements for amounts. |
Nature_of_Business_and_Account
Nature of Business and Accounting Policies | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
Accounting Policies [Abstract] | ' | |||||||||||||||||||
Nature of Business and Accounting Policies | ' | |||||||||||||||||||
Nature of Business and Accounting Policies | ||||||||||||||||||||
Business | ||||||||||||||||||||
Vertex Pharmaceuticals Incorporated (“Vertex” or the “Company”) is in the business of discovering, developing, manufacturing and commercializing small molecule drugs for patients with serious diseases in specialty markets. The Company's two products are: KALYDECO (ivacaftor), which the Company markets in the United States and international markets for the treatment of patients six years of age and older with cystic fibrosis (“CF”), who have the G551D mutation in their cystic fibrosis transmembrane conductance regulator (“CFTR”) gene, and INCIVEK (telaprevir), which is approved in the United States and Canada for the treatment of adults with genotype 1 hepatitis C virus (“HCV”) infection. | ||||||||||||||||||||
The Company began recognizing net product revenues from sales of INCIVEK and KALYDECO in the second quarter of 2011 and first quarter of 2012, respectively. The Company’s collaborator, Janssen Pharmaceutica NV (“Janssen”), began marketing telaprevir in its territories under the brand name INCIVO in September 2011. The Company’s net loss attributable to Vertex for 2013 was $445.0 million, or $1.98 per share. As of December 31, 2013, the Company had cash, cash equivalents and marketable securities of approximately $1.47 billion. The Company expects that cash flows from the sales of its products, together with the Company’s cash, cash equivalents and marketable securities, will be sufficient to fund its operations for at least the next twelve months. | ||||||||||||||||||||
Vertex is subject to risks common to companies in its industry including, but not limited to, the dependence on revenues from KALYDECO, competition, uncertainty about clinical trial outcomes and regulatory approvals, uncertainties relating to pharmaceutical pricing and reimbursement, rapid technological change, uncertain protection of proprietary technology, the need to comply with government regulations, share price volatility, dependence on collaborative relationships and potential product liability. | ||||||||||||||||||||
Basis of Presentation | ||||||||||||||||||||
The consolidated financial statements reflect the operations of (i) the Company and (ii) its wholly-owned subsidiaries. In addition, the consolidated financial statements for the period from June 13, 2011 through December 31, 2013, reflect the operations of Alios BioPharma, Inc. (“Alios”), a collaborator that is a variable interest entity (a “VIE”) for which the Company was deemed under applicable accounting guidance to have a variable interest and be the primary beneficiary. As of December 31, 2013, the Company deconsolidated Alios, and the Company's consolidated balance sheet as of December 31, 2013 excludes Alios. All material intercompany balances and transactions have been eliminated. The Company operates in one segment, pharmaceuticals. Please refer to Note X, "Segment Information," for enterprise-wide disclosures regarding the Company’s revenues, major customers and long-lived assets by geographic area. | ||||||||||||||||||||
Use of Estimates | ||||||||||||||||||||
The preparation of consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the amounts of revenues and expenses during the reported periods. Significant estimates in these consolidated financial statements have been made in connection with the calculation of revenues, inventories, research and development expenses, stock-based compensation expense, restructuring expense, the fair value of intangible assets, noncontrolling interest (Alios), the consolidation and deconsolidation of a VIE, leases and the income tax provision. The Company bases its estimates on historical experience and various other assumptions, including in certain circumstances future projections, that management believes to be reasonable under the circumstances. Actual results could differ from those estimates. Changes in estimates are reflected in reported results in the period in which they become known. | ||||||||||||||||||||
Revenue Recognition | ||||||||||||||||||||
Product Revenues, Net | ||||||||||||||||||||
The Company sells its products principally to a limited number of major and selected regional wholesalers and specialty pharmacy providers in North America as well as government-owned and supported customers in Europe (collectively, its “Customers”). The Company's Customers in North America subsequently resell the products to patients and health care providers. The Company recognizes net revenues from product sales upon delivery as long as (i) there is persuasive evidence that an arrangement exists between the Company and the Customer, (ii) collectibility is reasonably assured and (iii) the price is fixed or determinable. | ||||||||||||||||||||
In order to conclude that the price is fixed or determinable, the Company must be able to (i) calculate its gross product revenues from sales to Customers and (ii) reasonably estimate its net product revenues upon delivery to its Customer's locations. The Company calculates gross product revenues based on the price that the Company charges its Customers. The Company estimates its net product revenues by deducting from its gross product revenues (a) trade allowances, such as invoice discounts for prompt payment and Customer fees, (b) estimated government and private payor rebates, chargebacks and discounts, (c) estimated reserves for expected product returns and (d) estimated costs of incentives offered to certain indirect customers, including patients. | ||||||||||||||||||||
The Company makes significant estimates and judgments that materially affect the Company’s recognition of net product revenues. In certain instances, the Company may be unable to reasonably conclude that the price is fixed or determinable at the time of delivery, in which case it defers the recognition of revenues. Once the Company is able to determine that the price is fixed or determinable, it recognizes the revenues associated with the units in which revenue recognition was deferred. | ||||||||||||||||||||
Trade Allowances: The Company generally provides invoice discounts on product sales to its Customers for prompt payment and pays fees for distribution services, such as fees for certain data that Customers provide to the Company. The payment terms for sales to Customers in the United States generally include a 2% discount for payment within 30 days. The Company expects that, based on its experience, its Customers will earn these discounts and fees, and deducts the full amount of these discounts and fees from its gross product revenues and accounts receivable at the time such revenues are recognized. | ||||||||||||||||||||
Rebates, Chargebacks and Discounts: The Company contracts with government agencies and various private organizations (collectively, its “Third-party Payors”) so that products will be eligible for purchase by, or partial or full reimbursement from, such Third-party Payors. The Company estimates the rebates, chargebacks and discounts it will provide to Third-party Payors and deducts these estimated amounts from its gross product revenues at the time the revenues are recognized. For each product, the Company estimates the aggregate rebates, chargebacks and discounts that it will provide to Third-party Payors based upon (i) the Company’s contracts with these Third-party Payors, (ii) the government-mandated discounts applicable to government-funded programs, (iii) information obtained from the Company’s Customers regarding the payor mix for such product and (iv) historical experience. | ||||||||||||||||||||
Product Returns: The Company estimates the amount of each product that will be returned and deducts these estimated amounts from its gross revenues at the time the revenues are recognized. The Company’s Customers have the right to return unopened unprescribed packages, subject to contractual limitations. To date product returns have been minimal and, based on inventory levels held by its Customers and its distribution model, the Company believes that returns of its products will continue to be minimal. | ||||||||||||||||||||
Other Incentives: Other incentives that the Company offers include co-pay mitigation rebates provided by the Company to commercially insured patients who have coverage and who reside in states that permit co-pay mitigation programs. The Company’s co-pay mitigation programs are intended to reduce each participating patient’s portion of the financial responsibility for a product’s purchase price to a specified dollar amount. Based upon the terms of the Company's co-pay mitigation programs, the Company estimates average co-pay mitigation amounts for each of its products in order to establish its accruals for co-pay mitigation rebates and deducts these estimated amounts from its gross product revenues at the later of the date (i) the revenues are recognized or (ii) the incentive is offered. The Company’s co-pay mitigation rebates are subject to expiration. | ||||||||||||||||||||
The following table summarizes activity in each of the product revenue allowance and reserve categories for the three years ended December 31, 2013: | ||||||||||||||||||||
Trade | Rebates, | Product | Other | Total | ||||||||||||||||
Allowances | Chargebacks | Returns | Incentives | |||||||||||||||||
and Discounts | ||||||||||||||||||||
(in thousands) | ||||||||||||||||||||
2013 | ||||||||||||||||||||
Beginning Balance | $ | 5,416 | $ | 63,560 | $ | 2,852 | $ | 3,565 | $ | 75,393 | ||||||||||
Provision related to current period sales | 31,395 | 204,459 | 5,795 | 9,295 | 250,944 | |||||||||||||||
Adjustments related to prior period sales | 343 | 4,474 | 15,149 | (228 | ) | 19,738 | ||||||||||||||
Credits/payments made | (35,619 | ) | (204,249 | ) | (7,997 | ) | (11,077 | ) | (258,942 | ) | ||||||||||
Ending Balance | $ | 1,535 | $ | 68,244 | $ | 15,799 | $ | 1,555 | $ | 87,133 | ||||||||||
2012 | ||||||||||||||||||||
Beginning Balance | $ | 11,162 | $ | 52,659 | $ | 340 | $ | 5,202 | $ | 69,363 | ||||||||||
Provision related to current period sales | 55,913 | 216,942 | 2,067 | 19,103 | 294,025 | |||||||||||||||
Adjustments related to prior period sales | 29 | 3,883 | 1,498 | 72 | 5,482 | |||||||||||||||
Credits/payments made | (61,688 | ) | (209,924 | ) | (1,053 | ) | (20,812 | ) | (293,477 | ) | ||||||||||
Ending Balance | $ | 5,416 | $ | 63,560 | $ | 2,852 | $ | 3,565 | $ | 75,393 | ||||||||||
2011 | ||||||||||||||||||||
Beginning Balance | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||
Provision related to current period sales | 38,228 | 75,145 | 553 | 9,692 | 123,618 | |||||||||||||||
Credits/payments made | (27,066 | ) | (22,486 | ) | (213 | ) | (4,490 | ) | (54,255 | ) | ||||||||||
Ending Balance | $ | 11,162 | $ | 52,659 | $ | 340 | $ | 5,202 | $ | 69,363 | ||||||||||
Based on the current information available to the Company, cumulative adjustments related to prior period sales represent 0.7% and 1.3%, respectively, of the gross product revenues that were recorded in the years ended December 31, 2012 and 2011. | ||||||||||||||||||||
Royalty Revenues | ||||||||||||||||||||
The Company’s royalty revenues on commercial sales of INCIVO (telaprevir) by Janssen are based on net sales of licensed products in licensed territories as provided by Janssen. The Company recognizes royalty revenues in the period the sales occur. | ||||||||||||||||||||
The Company has sold its rights to receive certain royalties on sales of an HIV protease inhibitor (fosamprenavir) and recognizes the revenues related to this sale as royalty revenues. In the circumstance where the Company has sold its rights to future royalties under a license agreement and also maintains continuing involvement in the royalty arrangement (but not significant continuing involvement in the generation of the cash flows payable to the purchaser of the future royalty rights), the Company defers recognition of the proceeds it receives for the royalty stream and recognizes these deferred revenues over the life of the license agreement pursuant to the units-of-revenue method. The Company’s estimates regarding the estimated remaining royalty payments due to the purchaser have changed in the past and may change in the future. | ||||||||||||||||||||
Collaborative Revenues | ||||||||||||||||||||
The Company recognizes revenues generated through collaborative research, development and/or commercialization agreements. The terms of these agreements typically include payment to the Company of one or more of the following: nonrefundable, up-front license fees; development and commercial milestone payments; funding of research and/or development activities; payments for services the Company provides through its third-party manufacturing network; and royalties on net sales of licensed products. Each of these types of payments results in collaborative revenues, except for revenues from royalties on net sales of licensed products, which are classified as royalty revenues. | ||||||||||||||||||||
For each collaborative research, development and/or commercialization agreement that result in revenues, the Company determines (i) whether multiple deliverables exist, (ii) whether the undelivered elements have value to the customer on a stand-alone basis, (iii) how the deliverables should be separated and (iv) how the consideration should be allocated to the deliverables. For arrangements entered into or materially modified after January 1, 2011, the Company allocates consideration in an arrangement using the relative selling price method based on management’s best estimate of selling price of deliverables if it does not have vendor-specific objective evidence or third-party evidence. As part of the accounting for these agreements, the Company must develop assumptions that require judgment to determine the best estimate of selling price. Key assumptions utilized by the Company to determine the best estimate of selling price may include patient enrollment requirements from regulatory authorities, development timelines, reimbursement rates for personnel costs, discount rates, and estimated third-party development costs. | ||||||||||||||||||||
The Company evaluates amendments to its existing arrangements to determine whether they have been materially modified. In making its determination that an arrangement has been materially modified, the Company considers whether there have been significant changes to the consideration under the arrangement, the deliverables under the arrangement, the timing of deliverables and the period of the arrangement. If the arrangement is determined to have been materially modified, the Company allocates fixed consideration under the arrangement using its best estimate of selling price to the remaining undelivered elements at the date of material modification. Any consideration remaining after the allocation is recognized as revenue. | ||||||||||||||||||||
Collaborative research, development and/or commercialization agreements entered into prior to January 1, 2011 that contained multiple elements of revenue were divided into separate units of accounting if certain criteria were met, including whether the delivered element had stand-alone value to the collaborator and whether there was objective and reliable evidence of the fair value of the undelivered obligation(s). The Company allocated consideration it received among the separate units either on the basis of each unit’s fair value or using the residual method, and applied the revenue recognition criteria to each of the separate units. | ||||||||||||||||||||
Up-front License Fees: If the license to the Company's intellectual property was determined to have stand-alone value from the other deliverables identified in the arrangement, the Company recognized revenues from nonrefundable, up-front license fees upon delivery. If these licenses did not have stand-alone value, the Company recognized revenues from nonrefundable, up-front license fees on a straight-line basis over the contracted or estimated period of performance. The Company evaluated the period of performance each reporting period and adjusted the period of performance on a prospective basis if there were changes to be made. | ||||||||||||||||||||
Milestone Payments: At the inception of each agreement that included research and development milestone payments, the Company evaluated whether each milestone was substantive. The Company recognized revenues related to substantive milestones in full in the period in which the substantive milestone was achieved if payment was reasonably assured. If a milestone was not considered substantive, the Company recognized the applicable milestone payment over the period of performance. | ||||||||||||||||||||
Research and Development Activities/Manufacturing Services: If the Company was entitled to reimbursement from its collaborators for specified research and development expenses and/or was entitled to payments for specified manufacturing services that the Company provided through its third-party manufacturing network, the Company determined whether the research and development funding would result in collaborative revenues or an offset to research and development expenses. | ||||||||||||||||||||
Concentration of Credit Risk | ||||||||||||||||||||
Financial instruments that potentially subject the Company to concentration of credit risk consist principally of money market funds and marketable securities. The Company places these investments with highly rated financial institutions, and, by policy, limits the amounts of credit exposure to any one financial institution. These amounts at times may exceed federally insured limits. The Company has not experienced any credit losses in these accounts and does not believe it is exposed to any significant credit risk on these funds. The Company implemented a foreign exchange hedging program in December 2013. As of December 31, 2013, the notional amount and fair value of these hedges was not significant. | ||||||||||||||||||||
The Company also is subject to credit risk from its accounts receivable related to its product sales and collaborators. The Company evaluates the creditworthiness of each of its customers and has determined that all of its material customers are creditworthy. To date, the Company has not experienced significant losses with respect to the collection of its accounts receivable. The Company's receivables from Greece and Italy were not material in 2013, and the Company had no receivables from Spain or Portugal in 2013. The Company believes that its allowance for doubtful accounts was adequate at December 31, 2013. Please refer to Note X, "Segment Information," for further information. | ||||||||||||||||||||
Cash and Cash Equivalents | ||||||||||||||||||||
The Company considers all highly liquid investments with original maturities of three months or less at the date of purchase to be cash equivalents. | ||||||||||||||||||||
Restricted Cash | ||||||||||||||||||||
Restricted cash consists of balances held in deposit with certain banks to collateralize conditional stand-by letters of credit in the names of the Company’s landlords pursuant to certain operating lease agreements. The Company also separately disclosed on its consolidated balance sheet restricted cash and cash equivalents (Alios) as of December 31, 2012. The Company deconsolidated Alios as of December 31, 2013. Please refer to Note B, "Collaborative Arrangements," for further information. | ||||||||||||||||||||
Marketable Securities | ||||||||||||||||||||
The Company's marketable securities consist of investments in government-sponsored enterprise securities, corporate debt securities and commercial paper that are classified as available-for-sale. The Company classifies marketable securities available to fund current operations as current assets on its consolidated balance sheets. Marketable securities are classified as long-term assets on the consolidated balance sheets if (i) they have been in an unrealized loss position for longer than one year and (ii) the Company has the ability and intent to hold them (a) until the carrying value is recovered and (b) such holding period may be longer than one year. The Company's marketable securities are stated at fair value with their unrealized gains and losses included as a component of accumulated other comprehensive loss, which is a separate component of shareholders’ equity, until such gains and losses are realized. The fair value of these securities is based on quoted prices for identical or similar assets. | ||||||||||||||||||||
The Company reviews investments in marketable securities for other-than-temporary impairment whenever the fair value of an investment is less than the amortized cost and evidence indicates that an investment’s carrying amount is not recoverable within a reasonable period of time. To determine whether an impairment is other-than-temporary, the Company considers whether it has an intent to sell, or whether it is more likely than not that the Company will be required to sell, the investment before recovery of the investment’s amortized cost basis. Evidence considered in this assessment includes reasons for the impairment, compliance with the Company’s investment policy, the severity and the duration of the impairment and changes in value subsequent to year-end. If a decline in the fair value is considered other-than-temporary, based on available evidence, the unrealized loss is transferred from other comprehensive income (loss) to the consolidated statements of operations. | ||||||||||||||||||||
There were no charges recorded for other-than-temporary declines in fair value of marketable securities in 2013, 2012 or 2011. Realized gains and losses are determined using the specific identification method and are included in other income (expense), net in the consolidated statements of operations. There were no gross realized gains or losses recognized in 2013, 2012 or 2011. | ||||||||||||||||||||
Stock-based Compensation Expense | ||||||||||||||||||||
The Company expenses the fair value of employee stock options and other forms of stock-based employee compensation over the associated employee service period on a straight-line basis. For awards with performance conditions, the Company estimates the likelihood of satisfaction of the performance conditions, which affects the period over which the expense is recognized, and recognizes the expense using the accelerated attribution model. Stock-based compensation expense is determined based on the fair value of the award at the grant date, including estimated forfeitures, and is adjusted each period to reflect actual forfeitures and the outcomes of certain performance conditions. | ||||||||||||||||||||
Research and Development Expenses | ||||||||||||||||||||
The Company expenses as incurred all research and development expenses, including amounts funded by research and development collaborations. The Company capitalizes nonrefundable advance payments made by the Company for research and development activities and expenses the payments as the related goods are delivered or the related services are performed. | ||||||||||||||||||||
Research and development expenses are comprised of costs incurred by the Company in performing research and development activities, including salary and benefits; stock-based compensation expense; laboratory supplies and other direct expenses; contractual services costs, including clinical trial and pharmaceutical development costs; expenses associated with drug supplies that are not being capitalized; and infrastructure costs, including facilities costs and depreciation expense. | ||||||||||||||||||||
Advertising Expenses | ||||||||||||||||||||
The Company expenses the costs of advertising, including promotional expenses, as incurred. Advertising expenses, recorded in sales, general and administrative expenses, were $19.6 million, $58.6 million and $30.8 million in 2013, 2012 and 2011, respectively. | ||||||||||||||||||||
Inventories | ||||||||||||||||||||
The Company values its inventories at the lower-of-cost or market. The Company determines the cost of its inventories, which includes amounts related to materials and manufacturing overhead, on a first-in, first-out basis. The Company performs an assessment of the recoverability of capitalized inventory during each reporting period, and writes down any excess and obsolete inventories to their realizable value in the period in which the impairment is first identified. Shipping and handling costs incurred for inventory purchases are capitalized and recorded upon sale in cost of product revenues in the consolidated statements of operations. Shipping and handling costs incurred for product shipments are recorded as incurred in cost of product revenues in the consolidated statements of operations. | ||||||||||||||||||||
The Company capitalizes inventories produced in preparation for initiating sales of a drug candidate when the related drug candidate is considered to have a high likelihood of regulatory approval and the related costs are expected to be recoverable through sales of the inventories. In determining whether or not to capitalize such inventories, the Company evaluates, among other factors, information regarding the drug candidate’s safety and efficacy, the status of regulatory submissions and communications with regulatory authorities and the outlook for commercial sales, including the existence of current or anticipated competitive drugs and the availability of reimbursement. In addition, the Company evaluates risks associated with manufacturing the drug candidate and the remaining shelf-life of the inventories. | ||||||||||||||||||||
Property and Equipment | ||||||||||||||||||||
Property and equipment are recorded at cost. Depreciation expense is recorded using the straight-line method over the estimated useful life of the related asset, generally seven to ten years for furniture and equipment, three to five years for computers and software, 40 years for buildings and for leasehold improvements, the useful life of the improvements or the estimated remaining life of the associated lease. Maintenance and repairs to an asset that do not improve or extend its life are charged to operations. When assets are retired or otherwise disposed of, the assets and related accumulated depreciation are eliminated from the accounts and any resulting gain or loss is reflected in the Company’s consolidated statements of operations. The Company performs an assessment of the fair value of the assets if indicators of impairment are identified during a reporting period and records the assets at the lower of the net book value or the fair value of the assets. | ||||||||||||||||||||
The Company capitalizes internal costs incurred to develop software for internal use during the application development stage. The Company expenses costs related to the planning and post-implementation phases of development of software for internal use as these costs are incurred. Maintenance and enhancement costs (including costs in the post-implementation stages) are expensed as incurred, unless such costs relate to substantial upgrades and enhancements to the software resulting in added functionality, in which case the costs are capitalized. Amortization of capitalized internally developed software costs is recorded in depreciation expense over the useful life of the related asset. | ||||||||||||||||||||
The Company records certain construction costs incurred by a landlord as an asset and corresponding financing obligation on the Company's consolidated balance sheets as the owner of the buildings for accounting purposes. | ||||||||||||||||||||
Capital Leases | ||||||||||||||||||||
The assets and liabilities associated with capital lease agreements are recorded at the present value of the minimum lease payments at the inception of the lease agreement. The assets are amortized using the straight-line method over the estimated useful life of the related asset or the remaining life of the associated lease. Amortization of assets that the Company leases pursuant to a capital lease is included in depreciation expense. The Company performs an assessment of the fair value of the assets if indicators of impairment are identified during a reporting period and records the assets at the lower of the net book value or the fair value of the assets. Assets recorded under capital leases are recorded within "Property and equipment, net" and liabilities related to those assets are recorded within "Capital lease obligations, current portion" and "Capital lease obligations, excluding current portion," on the Company's consolidated balance sheets. | ||||||||||||||||||||
Income Taxes | ||||||||||||||||||||
Deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial statement carrying amounts and the income tax bases of assets and liabilities. A valuation allowance is applied against any net deferred tax asset if, based on the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. | ||||||||||||||||||||
The Company records liabilities related to uncertain tax positions by prescribing a minimum recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The Company does not believe any such uncertain tax positions currently pending will have a material adverse effect on its consolidated financial statements. | ||||||||||||||||||||
Variable Interest Entities | ||||||||||||||||||||
The Company reviews each collaboration agreement pursuant to which the Company licenses assets owned by a collaborator in order to determine whether or not the collaborator is a VIE. If the collaborator is a VIE, the Company assesses whether or not the Company is the primary beneficiary of that VIE based on a number of factors, including (i) which party has the power to direct the activities that most significantly affect the VIE’s economic performance, (ii) the parties’ contractual rights and responsibilities pursuant to the collaboration agreement and (iii) which party has the obligation to absorb losses or the right to receive benefits from the VIE. If the Company determines it is the primary beneficiary of a VIE at the onset of the collaboration agreement, the collaboration is treated as a business combination and the Company consolidates the financial statements of the VIE into the Company’s consolidated financial statements. The Company evaluates whether it continues to be the primary beneficiary of any consolidated VIEs on a quarterly basis. If the Company determines that it is no longer the primary beneficiary of a consolidated VIE, or no longer has a variable interest in the VIE, it deconsolidates the VIE in the period that the determination is made. | ||||||||||||||||||||
Business Combinations | ||||||||||||||||||||
The Company assigns the value of consideration, including contingent consideration, transferred in business combinations to the appropriate accounts on the Company's consolidated balance sheet based on their fair value as of the effective date of the transaction. If a collaboration has been treated as a business combination and there are contingent payments, increases in the fair value of the contingent payments pursuant to collaborations accounted for as business combinations result in a decrease in net income attributable to Vertex (or an increase in net loss attributable to Vertex) on a dollar-for-dollar basis. Transaction costs and any restructuring costs associated with these transactions are expensed as incurred. | ||||||||||||||||||||
Fair Value of In-process Research and Development Assets and Contingent Payments in Business Combinations | ||||||||||||||||||||
The present-value models used to estimate the fair values of research and development assets and contingent payments pursuant to collaborations incorporate significant assumptions, including: assumptions regarding the probability of obtaining marketing approval and/or achieving relevant development milestones for a drug candidate; estimates regarding the timing of and the expected costs to develop a drug candidate; estimates of future cash flows from potential product sales and/or the potential to achieve certain commercial milestones with respect to a drug candidate; and the appropriate discount and tax rates. | ||||||||||||||||||||
In-process Research and Development Assets | ||||||||||||||||||||
The Company records the fair value of in-process research and development assets as of the transaction date of a business combination. Each of these assets is accounted for as an indefinite-lived intangible asset and is maintained on the Company’s consolidated balance sheet until either the project underlying it is completed or the asset becomes impaired. If the asset becomes impaired or is abandoned, the carrying value of the related intangible asset is written down to its fair value, and an impairment charge is recorded in the period in which the impairment occurs. If a project is completed, the carrying value of the related intangible asset is amortized as a part of cost of product revenues over the remaining estimated life of the asset beginning in the period in which the project is completed. In-process research and development assets are tested for impairment on an annual basis as of October 1, and more frequently if indicators are present or changes in circumstances suggest that impairment may exist. | ||||||||||||||||||||
Goodwill | ||||||||||||||||||||
The difference between the purchase price and the fair value of assets acquired and liabilities assumed in a business combination is allocated to goodwill. Goodwill is evaluated for impairment on an annual basis as of October 1, and more frequently if indicators are present or changes in circumstances suggest that impairment may exist. | ||||||||||||||||||||
Deconsolidation and Discontinued Operations | ||||||||||||||||||||
Upon the occurrence of certain events and on a regular basis, the Company evaluates whether it no longer has a controlling financial interest in its subsidiaries, including deemed subsidiaries such as consolidated VIEs. If it is determined that the Company no longer has a controlling interest, the subsidiary is deconsolidated. The Company records a gain or loss on deconsolidation based on the difference on the deconsolidation date between (i) the aggregate of (a) the fair value of any consideration received, (b) the fair value of any retained noncontrolling investment in the former subsidiary and (c) the carrying amount of any noncontrolling interest in the subsidiary being deconsolidated, less (ii) the carrying amount of the former subsidiary’s assets and liabilities. | ||||||||||||||||||||
The Company assesses whether a deconsolidation is required to be presented as discontinued operations in its consolidated financial statements on the deconsolidation date. This assessment is based on whether or not (i) the operations and cash flows to the former subsidiary have been or will be eliminated from the Company's ongoing operations as a result of the deconsolidation event and (ii) the Company will have any significant continuing involvement in the operations of the former subsidiary after the deconsolidation event. If the Company determines that a deconsolidation requires presentation as a discontinued operation on the deconsolidation date, or at any point during the one year period following such date, it will present the former subsidiary as a discontinued operation in current and comparative period financial statements. | ||||||||||||||||||||
Derivative Instruments, Embedded Derivatives and Hedging Activities | ||||||||||||||||||||
The Company has entered into financial transactions involving free-standing derivative instruments and embedded derivatives in the past. Embedded derivatives are required to be bifurcated from the host instruments because the derivatives are not clearly and closely related to the host instruments. The Company determines the fair value of each derivative instrument or embedded derivative that is identified on the date of issuance and at the end of each quarterly period. The estimates of the fair value of these derivatives, particularly with respect to derivatives related to the achievement of milestones in the development of telaprevir, included significant assumptions regarding the estimates market participants would make in order to evaluate these derivatives. | ||||||||||||||||||||
The Company recognizes the fair value of hedging instruments that are designated and qualify as hedging instruments pursuant to GAAP, primarily foreign currency forward contracts, as either assets or liabilities on the consolidated balance sheets. Changes in the fair value of hedging instruments are recorded each period in accumulated other comprehensive loss until the date of settlement, at which point the cumulative change in the fair value since the inception of the hedge is recognized in "Product revenues, net," in its consolidated statements of operations. The Company classifies the cash flows from hedging instruments in the same category as the cash flows from the hedged items. | ||||||||||||||||||||
The Company assesses, both at inception and on an ongoing basis, whether the foreign currency forward contracts used in hedging transactions are highly effective in offsetting the changes in cash flows of the hedged items. The Company also assesses hedge ineffectiveness quarterly and, if determined to be ineffective, records the gain or loss related to the ineffective portion to earnings in "Other income (expense), net" in the consolidated statements of operations. | ||||||||||||||||||||
Restructuring Expenses | ||||||||||||||||||||
The Company records costs and liabilities associated with exit and disposal activities based on estimates of fair value in the period the liabilities are incurred. In periods subsequent to the initial measurement, the Company measures changes to the liability using the credit-adjusted risk-free discount rate applied in the initial period. The Company evaluates and adjusts these liabilities as appropriate for changes in circumstances at least on a quarterly basis. | ||||||||||||||||||||
Comprehensive Income (Loss) | ||||||||||||||||||||
Comprehensive income (loss) consists of net income (loss) and other comprehensive income (loss), which includes foreign currency translation adjustments and unrealized gains and losses on foreign currency forward contracts and certain marketable securities. For purposes of comprehensive income (loss) disclosures, the Company does not record tax provisions or benefits, as the Company intends to permanently reinvest undistributed earnings in its foreign subsidiaries. | ||||||||||||||||||||
Foreign Currency Translation and Transactions | ||||||||||||||||||||
All material consolidated entities have the U.S. dollar as their functional currency. Non-U.S. dollar functional currency subsidiaries have assets and liabilities translated into U.S. dollars at rates of exchange in effect at the end of the year. Revenue and expense amounts are translated using the average exchange rates for the period. Net unrealized gains and losses resulting from foreign currency translation are included in accumulated other comprehensive loss, which is a separate component of shareholders’ equity. Included in accumulated other comprehensive loss are net unrealized losses related to foreign currency translation of $0.3 million, $0.7 million and $0.9 million at December 31, 2013, 2012, and 2011, respectively. Net foreign currency exchange transaction gains or losses are included in "Net income (loss)" on the Company’s consolidated statement of operations. Net transaction gains were $5.1 million and $0.7 million for 2013 and 2011, respectively, and net transaction losses were $0.4 million in 2012. | ||||||||||||||||||||
Net Income (Loss) Per Share Attributable to Vertex Common Shareholders | ||||||||||||||||||||
Basic and diluted net income per share attributable to Vertex common shareholders are presented in conformity with the two-class method required for participating securities. Under the two-class method, earnings are allocated to (i) Vertex common shares, excluding unvested restricted stock, and (ii) participating securities, based on their respective weighted-average shares outstanding for the period. Shares of unvested restricted stock granted under the Company's Amended and Restated 2006 Stock and Option Plan have the non-forfeitable right to receive dividends on an equal basis with other outstanding common stock. As a result, these unvested shares of restricted stock are considered participating securities under the two-class method. Potentially dilutive shares result from the assumed exercise of outstanding stock options (the proceeds of which are then assumed to have been used to repurchase outstanding stock using the treasury stock method) and the assumed conversion of convertible notes. | ||||||||||||||||||||
Basic net loss per share attributable to Vertex common shareholders is based upon the weighted-average number of common shares outstanding during the period, excluding restricted stock that has been issued but is not yet vested. Diluted net loss per share attributable to Vertex common shareholders is based upon the weighted-average number of common shares outstanding during the period plus additional weighted-average common equivalent shares outstanding during the period when the effect is dilutive. | ||||||||||||||||||||
Recent Accounting Pronouncements | ||||||||||||||||||||
The Company did not adopt any new accounting pronouncements during 2013 that had a material effect on the Company’s consolidated financial statements. |
Collaborative_Arrangements
Collaborative Arrangements | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Collaborative Arrangements | ' | |||||||||||
Collaborative Arrangements | ' | |||||||||||
Collaborative Arrangements | ||||||||||||
Janssen Pharmaceutica NV | ||||||||||||
In 2006, the Company entered into a collaboration agreement with Janssen (the "2006 Janssen Agreement") for the development, manufacture and commercialization of telaprevir, which Janssen began marketing under the brand name INCIVO in certain of its territories in September 2011. Under the collaboration agreement, Janssen has exclusive rights to commercialize telaprevir in its territories including Europe, South America, the Middle East, Africa and Australia. In November 2013, the Company and Janssen amended the collaboration agreement (the "2013 Janssen Amendment," as amended the "Janssen Agreement"). | ||||||||||||
Janssen made a $165.0 million up-front license payment to the Company in 2006. The Company amortized the up-front license payment over the Company’s estimated period of performance under the Janssen Agreement through November 2013. As of November 2013, the effective date of the 2013 Janssen Amendment, there was $32.1 million remaining in deferred revenues related to this up-front license payment. | ||||||||||||
In addition to the up-front license payment, Janssen made contingent milestone payments for successful development, approval and launch of telaprevir as a product in its territories. At the inception of the 2006 Janssen Agreement, the Company determined that all of the contingent milestones were substantive and would result in revenues in the period in which the milestone was achieved. The Company earned $350.0 million of these contingent milestone payments, including a $50.0 million milestone payment earned in the first quarter of 2011 in connection with the European Medicines Agency’s acceptance of the marketing authorization application for INCIVO and an aggregate of $200.0 million in milestone payments earned in the third quarter of 2011 related to the approval of INCIVO by the European Commission and the launch of INCIVO in the European Union. The Company will not receive any further milestone payments under the Janssen Agreement. | ||||||||||||
Under the Janssen Agreement, each party incurs internal and external reimbursable expenses and is reimbursed by the other party for 50% of these expenses. The Company recognized the full amount of the reimbursable costs it incurred as research and development expenses on its consolidated statements of operations. The Company recognized, including in 2013, the amounts Janssen was obligated to pay the Company with respect to reimbursable expenses, net of reimbursable expenses incurred by Janssen, as collaborative revenues. During 2012 and 2011, Janssen incurred more reimbursable costs than the Company, and the net amounts payable by the Company to reimburse Janssen were recorded as a reduction of collaborative revenues. Each of the parties were responsible for drug supply in its territories. Until December 31, 2013, the Company provided Janssen certain services through the Company’s third-party manufacturing network for telaprevir. | ||||||||||||
Janssen paid the Company a tiered royalty averaging in the mid-20% range as a percentage of net sales of INCIVO in Janssen’s territories through the fourth quarter of 2013. In addition, Janssen is responsible for certain third-party royalties on net sales of INCIVO in its territories. | ||||||||||||
Pursuant to the 2013 Janssen Amendment, (i) Janssen made a payment of $152.0 million to the Company in the fourth quarter of 2013; (ii) Janssen's obligations to pay the Company royalties on net sales of INCIVO (telaprevir) terminated after the fourth quarter of 2013; and (iii) Janssen received a fully-paid license to commercialize INCIVO in its territories, subject to the continued payment of certain third-party royalties on its net sales of INCIVO. The Company and Janssen continue to perform activities related to the telaprevir development program. | ||||||||||||
The Company determined the 2013 Janssen Amendment was a material modification to the 2006 Janssen Agreement because there was a material change to the consideration and deliverables under the agreement and determined that there is one undelivered element under the agreement, as amended, which is the continuation of certain telaprevir development activities. The Company recognized $182.4 million of collaborative revenues pursuant to the Janssen Agreement in the fourth quarter of 2013. This amount was primarily attributable to (i) the residual consideration received from Janssen, including the $152.0 million fourth quarter 2013 payment and the remaining deferred revenues related to the 2006 up-front payment less (ii) the best estimate of selling price for the remaining telaprevir development activities. As of December 31, 2013, the remaining deferred revenue balance related to the Janssen collaboration was $5.0 million and will be recognized as collaborative revenues as telaprevir development program activities are completed. | ||||||||||||
The agreement will continue in effect until the expiration of Janssen’s third-party royalty obligations, which expire on a country-by-country basis on the later of (a) the last-to-expire patent covering INCIVO or (b) the last required payment by Janssen to the Company pursuant to the agreement. In the European Union, the Company has a patent covering the composition-of-matter of INCIVO that expires in 2026. | ||||||||||||
During the three years ended December 31, 2013, the Company recognized the following revenues attributable to the Janssen collaboration: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(in thousands) | ||||||||||||
Royalty revenues | $ | 130,724 | $ | 117,592 | $ | 20,289 | ||||||
Collaborative revenues: | ||||||||||||
Up-front and amendment payments revenues | $ | 190,345 | $ | 12,428 | $ | 12,428 | ||||||
Milestone revenues | — | — | 250,000 | |||||||||
Net reimbursement (payment) for telaprevir development costs | 2,793 | (3,507 | ) | (8,418 | ) | |||||||
Reimbursement for manufacturing services | 10,299 | 7,257 | 20,383 | |||||||||
Total collaborative revenues attributable to the Janssen collaboration | $ | 203,437 | $ | 16,178 | $ | 274,393 | ||||||
Total revenues attributable to the Janssen collaboration | $ | 334,161 | $ | 133,770 | $ | 294,682 | ||||||
Mitsubishi Tanabe Pharma Corporation | ||||||||||||
The Company has a collaboration agreement (the “MTPC Agreement”) with Mitsubishi Tanabe Pharma Corporation ("Mitsubishi Tanabe") pursuant to which Mitsubishi Tanabe has a fully-paid license to manufacture and commercialize TELAVIC (the brand name under which Mitsubishi Tanabe is marketing telaprevir) in Japan and other specified countries in Asia. In September 2011, Mitsubishi Tanabe obtained approval to market TELAVIC in Japan. | ||||||||||||
The parties entered into the MTPC Agreement in 2004 and amended it in 2009. Pursuant to the MTPC Agreement, Mitsubishi Tanabe provided financial and other support for the development and commercialization of telaprevir, made a $105.0 million payment in connection with the 2009 amendment of the collaboration agreement and made a $65.0 million commercial milestone payment recognized as collaborative revenues in the fourth quarter of 2011. There are no further payments under this collaboration agreement. Mitsubishi Tanabe is responsible for its own development and manufacturing costs in its territory. | ||||||||||||
Mitsubishi Tanabe may terminate the MTPC Agreement at any time without cause upon 60 days’ prior written notice to the Company. The MTPC Agreement also may be terminated by either party for a material breach by the other, subject to notice and cure provisions. Unless earlier terminated, the MTPC Agreement will continue in effect until the expiration of the last-to-expire patent covering telaprevir in Mitsubishi Tanabe's territories. In Japan, the Company has a patent covering the composition-of-matter of telaprevir that expires in 2021. | ||||||||||||
The $105.0 million payment that the Company received in the third quarter of 2009 in connection with the amendment to the MTPC Agreement was a nonrefundable, up-front license fee, and revenues related to the 2009 payment were recognized on a straight-line basis over the period of performance of the Company’s obligations under the amended agreement. The final deferred revenues related to the 2009 up-front license payment were recognized in April 2012. In connection with the amendment to the MTPC Agreement, the Company supplied manufacturing services to Mitsubishi Tanabe, until April 2012, through the Company’s third-party manufacturing network for telaprevir. | ||||||||||||
The Company did not record any collaborative revenues attributable to the MTPC Agreement in 2013. The table below sets forth the total collaborative revenues attributable to the MTPC Agreement for 2012 or 2011: | ||||||||||||
2012 | 2011 | |||||||||||
(in thousands) | ||||||||||||
Amortized portion of up-front payments | $ | 12,744 | $ | 38,232 | ||||||||
Milestone revenues | 485 | 68,515 | ||||||||||
Payments for manufacturing services | 5,650 | 14,928 | ||||||||||
Total collaborative revenues attributable to the Mitsubishi Tanabe collaboration | $ | 18,879 | $ | 121,675 | ||||||||
Cystic Fibrosis Foundation Therapeutics Incorporated | ||||||||||||
In April 2011, the Company entered into an amendment (the “April 2011 Amendment”) to its existing collaboration agreement with Cystic Fibrosis Foundation Therapeutics Incorporated (“CFFT”) pursuant to which CFFT agreed to provide financial support for (i) development activities for VX-661, a corrector compound discovered under the collaboration, and (ii) additional research and development activities directed at discovering new corrector compounds. | ||||||||||||
The Company entered into the original collaboration agreement with CFFT in 2004 and amended it several times prior to 2011 to, among other things, provide partial funding for its cystic fibrosis drug discovery and development efforts. In 2006, the Company received a $1.5 million milestone payment from CFFT. There are no additional milestones payable by CFFT to the Company pursuant to the collaboration agreement, as amended. Under the April 2011 Amendment, CFFT agreed to provide the Company with up to $75.0 million in funding over approximately 5 years for corrector-compound research and development activities. The Company retains the right to develop and commercialize KALYDECO (ivacaftor), VX-809, VX-661 and any other compounds discovered during the course of the research collaboration with CFFT. The Company recognized collaborative revenues from this collaboration of $14.3 million, $17.0 million and $13.7 million, respectively, in 2013, 2012 and 2011. | ||||||||||||
In the original agreement, as amended prior to the April 2011 Amendment, the Company agreed to pay CFFT tiered royalties calculated as a percentage, ranging from single digits to sub-teens, of annual net sales of any approved drugs discovered during the research term that ended in 2008, including KALYDECO, lumacaftor and VX-661. The April 2011 Amendment provides for a tiered royalty in the same range on net sales of corrector compounds discovered during the research term that began in 2011. In each of the third quarter of 2012 and the first quarter of 2013, CFFT earned a commercial milestone payment of $9.3 million from the Company upon achievement of certain sales levels for KALYDECO. These milestones were reflected in the Company's cost of product revenues. There are no additional commercial milestone payments payable by the Company to CFFT related to sales levels for KALYDECO. The Company also is obligated to make a total of two one-time commercial milestone payments upon achievement of certain sales levels for corrector compounds such as lumacaftor or VX-661. | ||||||||||||
The Company began marketing KALYDECO in the United States in the first quarter of 2012 and began marketing KALYDECO in certain countries in the European Union in the third quarter of 2012. The Company has royalty obligations to CFFT for each compound commercialized pursuant to this collaboration until the expiration of patents covering that compound. The Company has patents in the United States and European Union covering the composition-of-matter of ivacaftor that expire in 2027 and 2025, respectively, subject to potential patent life extensions. The Company has patent applications in the United States and European Union covering the composition-of-matter of lumacaftor that expire in 2026, subject to potential patent life extensions. CFFT may terminate its funding obligations under the collaboration, as amended, in certain circumstances, in which case there will be a proportional adjustment to the royalty rates and commercial milestone payments for certain corrector compounds. The collaboration also may be terminated by either party for a material breach by the other, subject to notice and cure provisions. | ||||||||||||
Alios BioPharma, Inc. | ||||||||||||
License and Collaboration Agreement | ||||||||||||
In June 2011, the Company entered into a license and collaboration agreement (the “Alios Agreement”) with Alios, a privately-held biotechnology company. The Company and Alios are collaborating on the research, development and commercialization of an HCV nucleotide analogue discovered by Alios, ALS-2200 (now formulated as VX-135), which is designed to act on the HCV polymerase. | ||||||||||||
Under the terms of the Alios Agreement, the Company received exclusive worldwide rights to ALS-2200 (VX-135) and ALS-2158, a second HCV nucleotide analogue discovered by Alios that was developed pursuant to the Alios agreement through the third quarter of 2012. Alios and the Company began clinical development of ALS-2200 (VX-135) and ALS-2158 in December 2011. The Company is responsible for all costs related to development, commercialization and manufacturing of each compound licensed to the Company pursuant to the Alios Agreement and provided funding to Alios to conduct the Phase 1 clinical trials for ALS-2200 and ALS-2158. In addition, the Company provided funding for a research program, which ended in 2013, directed to the discovery of additional HCV nucleotide analogues that act on the HCV polymerase. | ||||||||||||
Upon entering into the Alios Agreement, the Company paid Alios a $60.0 million up-front payment. As of December 31, 2013, Alios had earned an aggregate of $60.0 million in development milestone payments pursuant to the Alios Agreement. The Alios Agreement provides for development milestone payments to Alios of up to an additional $312.5 million if VX-135 is approved and commercialized. In addition, Alios is eligible to receive commercial milestone payments of up to $750.0 million, as well as tiered royalties on net sales of VX-135. | ||||||||||||
The Company may terminate the Alios Agreement (i) upon 30 days’ notice to Alios if the Company ceases development after VX-135 has experienced a technical failure and/or (ii) upon 60 days’ notice to Alios at any time after the Company completes Phase 2a clinical trials. The Alios Agreement also may be terminated by either party for a material breach by the other, and by Alios for the Company’s inactivity or if the Company challenges certain Alios patents, in each case subject to notice and cure provisions. Unless earlier terminated, the Alios Agreement will continue in effect until the expiration of the Company’s royalty obligations, which expire on a country-by-country basis on the later of (a) the date the last-to-expire patent covering a licensed product expires or (b) 10 years after the first commercial sale in the country. | ||||||||||||
Alios is continuing to operate as a separate entity, is engaged in other programs directed at developing novel drugs that are not covered by the Alios Agreement and maintains ownership of the underlying patent rights that are licensed to the Company pursuant to the Alios Agreement. Under applicable accounting guidance, the Company determined that Alios was a VIE, its license to VX-135 and ALS-2158 was a variable interest in Alios, that Alios was a business and that the Company was Alios’ primary beneficiary for the period from June 13, 2011 through December 31, 2013. The Company based these determinations on, among other factors, the significance to Alios of the licensed compounds and on the Company’s power, through the joint steering committee for the licensed compounds established under the Alios Agreement, to direct the activities that most significantly affect the economic performance of Alios. | ||||||||||||
Accordingly, the Company consolidated Alios’ financial statements with the Company’s consolidated financial statements from June 13, 2011 through December 31, 2013. However, the Company’s interests in Alios were limited to those accorded to the Company in the Alios Agreement. In particular, the Company did not acquire any equity interest in Alios, any interest in Alios’ cash and cash equivalents or any control over Alios’ activities that do not relate to the Alios Agreement. Alios does not have any right to the Company’s assets except as provided in the Alios Agreement. | ||||||||||||
As of December 31, 2013, the Company determined that it no longer had a variable interest in Alios as a whole and did not possess the power to direct the activities that most significantly affect the economic performance of Alios based on, among other factors, the decline in significance to Alios of the licensed HCV nucleotide analogue program. A full impairment charge of $250.6 million related to the Alios collaboration and a benefit for income taxes of $102.1 million was recorded attributable to Alios. The Company deconsolidated Alios based on this conclusion as of December 31, 2013. The deconsolidation resulted in a gain of $68.2 million recorded in other income (expense), net attributable to Vertex in the consolidated statement of operations for the year ended December 31, 2013. The gain of $68.2 million was approximately the difference between (i) losses the Company recorded in 2011 and 2012 based on increases in the fair value of contingent milestone and royalty payments payable by the Company to Alios and (ii) the aggregate of $120.0 million in up-front and milestone payments that the Company has made to Alios to date pursuant to the Alios Agreement. | ||||||||||||
The Company continues to have significant continuing involvement with Alios due to the Alios Agreement; therefore, the deconsolidation of Alios is not presented as discontinued operations in the Company's consolidated financial statements as of December 31, 2013. The Company will evaluate whether it continues to have significant continuing involvement with Alios for a period of one year from the December 31, 2013 deconsolidation date. | ||||||||||||
Please refer to Note J, "Intangible Assets and Goodwill," for further information regarding the impairment of the HCV nucleotide analogue program. | ||||||||||||
Noncontrolling Interest (Alios) | ||||||||||||
Prior to the deconsolidation, the Company recorded noncontrolling interest (Alios) on two lines on its consolidated balance sheets. The noncontrolling interest (Alios) was reflected on two separate lines because Alios has both common shareholders and preferred shareholders that are entitled to redemption rights in certain circumstances. The Company recorded net loss (income) attributable to noncontrolling interest (Alios) on its consolidated statements of operations, reflecting Alios' net loss (income) for the reporting period, adjusted for changes in the fair value of contingent milestone payments and royalties payable by the Company to Alios, which was evaluated each reporting period. A summary of net loss (income) attributable to noncontrolling interest (Alios) for the three years ended December 31, 2013 is as follows: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(in thousands) | ||||||||||||
Loss before provision for (benefit from) income taxes | $ | 283,747 | $ | 20,044 | $ | 9,536 | ||||||
Decrease (increase) in fair value of contingent milestone and royalty payments | 124,920 | (114,970 | ) | (69,950 | ) | |||||||
Provision for (benefit from) income taxes | (166,145 | ) | 39,029 | 48,809 | ||||||||
Net loss (income) attributable to noncontrolling interest (Alios) | $ | 242,522 | $ | (55,897 | ) | $ | (11,605 | ) | ||||
In 2012 and 2011, the fair value of the contingent milestone payments and royalties payable by Vertex to Alios related to the in-licensed HCV nucleotide analogue program increased by $115.0 million and $70.0 million, respectively, due to the advancement of the Company's HCV nucleotide program, including the positive data the Company received in 2012 from a Phase 1 clinical trial that evaluated ALS-2200. As of December 31, 2013, the Company concluded that the fair value of the contingent milestone and royalty payments was zero. This determination was based on, among other factors, (a) safety, tolerability and efficacy data from a Phase 2a clinical trial of VX-135 in combination with daclatasvir that the Company received in late December 2013 and analyzed and announced in January 2014, (b) the continuing partial clinical hold on VX-135 by the U.S. Food and Drug Administration ("FDA"), (c) a review of the existing and emerging data regarding all-oral regimens for HCV infection being developed by the Company's competitors, and (d) the risks associated with establishing collaborations for the potential late-stage development of a combination regimen containing VX-135 and drug candidates controlled by third parties. | ||||||||||||
The Company used present-value models to determine the estimated fair value of the contingent milestone and royalty payments until it deconsolidated Alios, based on assumptions regarding the probability of achieving the relevant milestones, estimates regarding the time to develop drug candidates, estimates of future product sales and the appropriate discount and tax rates. The Company based its estimate of the probability of achieving the relevant milestones on industry data for similar assets and its own experience. The discount rates used in the valuation model represented a measure of credit risk associated with settling the liability. Significant judgment was used in determining the appropriateness of these assumptions at each reporting period. | ||||||||||||
Alios Balance Sheet Information | ||||||||||||
The Company included items related to Alios on the Company's consolidated balance sheet as of December 31, 2012. Due to the deconsolidation of Alios as of December 31, 2013, these items were not included on the Company's consolidated balance sheet as of December 31, 2013. The following table summaries items related to the Alios included on the Company's consolidated balance sheet as of December 31, 2012. | ||||||||||||
As of December 31, 2012 | ||||||||||||
(in thousands) | ||||||||||||
Restricted cash and cash equivalents (Alios) | $ | 69,983 | ||||||||||
Prepaid expenses and other current assets | $ | 672 | ||||||||||
Property and equipment, net | $ | 1,728 | ||||||||||
Intangible assets | $ | 250,600 | ||||||||||
Other assets | $ | 861 | ||||||||||
Accounts payable | $ | 1,054 | ||||||||||
Accrued expenses | $ | 6,099 | ||||||||||
Income taxes payable (Alios) | $ | 715 | ||||||||||
Deferred tax liability | $ | 152,781 | ||||||||||
Other liabilities, excluding current portion | $ | 910 | ||||||||||
Redeemable noncontrolling interest (Alios) | $ | 38,530 | ||||||||||
Noncontrolling interest (Alios) | $ | 196,672 | ||||||||||
As of December 31, 2012, the Company recorded Alios’ cash and cash equivalents as restricted cash and cash equivalents (Alios) because (i) the Company did not have any interest in or control over Alios’ cash and cash equivalents and (ii) the Alios Agreement did not provide for these assets to be used for the development of the assets that the Company licenses from Alios pursuant to the Alios Agreement. Assets recorded as a result of consolidating Alios’ financial condition into the Company’s consolidated balance sheet did not represent additional assets that could have been used to satisfy claims against the Company’s general assets. |
Net_Income_Loss_Per_Share_Attr
Net Income (Loss) Per Share Attributable to Vertex Common Shareholders | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Earnings Per Share [Abstract] | ' | |||||||||||
Net Income (Loss) Per Share Attributable to Vertex Common Stockholders | ' | |||||||||||
Net Income (Loss) Per Share Attributable to Vertex Common Shareholders | ||||||||||||
The following table sets forth the computation of basic and diluted net income (loss) per share for the three years ended December 31, 2013: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(in thousands, except per share amounts) | ||||||||||||
Basic net income (loss) attributable to Vertex per common share calculation: | ||||||||||||
Net income (loss) attributable to Vertex common shareholders | $ | (445,028 | ) | $ | (107,032 | ) | $ | 29,574 | ||||
Less: Undistributed earnings allocated to participating securities | — | — | (291 | ) | ||||||||
Net income (loss) attributable to Vertex common shareholders—basic | $ | (445,028 | ) | $ | (107,032 | ) | $ | 29,283 | ||||
Basic weighted-average common shares outstanding | 224,906 | 211,946 | 204,891 | |||||||||
Basic net income (loss) attributable to Vertex per common share | $ | (1.98 | ) | $ | (0.50 | ) | $ | 0.14 | ||||
Diluted net income (loss) attributable to Vertex per common share calculation: | ||||||||||||
Net income (loss) attributable to Vertex common shareholders | $ | (445,028 | ) | $ | (107,032 | ) | $ | 29,574 | ||||
Less: Undistributed earnings allocated to participating securities | — | — | (285 | ) | ||||||||
Net income (loss) attributable to Vertex common shareholders—diluted | $ | (445,028 | ) | $ | (107,032 | ) | $ | 29,289 | ||||
Weighted-average shares used to compute basic net income (loss) per common share | 224,906 | 211,946 | 204,891 | |||||||||
Effect of potentially dilutive securities: | ||||||||||||
Stock options | — | — | 3,863 | |||||||||
Other | — | — | 53 | |||||||||
Weighted-average shares used to compute diluted net income (loss) per common share | 224,906 | 211,946 | 208,807 | |||||||||
Diluted net income (loss) attributable to Vertex per common share | $ | (1.98 | ) | $ | (0.50 | ) | $ | 0.14 | ||||
The Company did not include the securities described in the following table in the computation of the diluted net income (loss) attributable to Vertex per common share calculations because the effect would have been anti-dilutive during each such period: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(in thousands) | ||||||||||||
Stock options | 15,729 | 19,726 | 9,626 | |||||||||
Convertible senior subordinated notes | — | 8,192 | 8,192 | |||||||||
Unvested restricted stock and restricted stock units | 2,165 | 2,350 | 8 | |||||||||
Fair_Value_Measurements
Fair Value Measurements | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||
Fair Value Measurements | ' | |||||||||||||||
Fair Value Measurements | ||||||||||||||||
The fair value of the Company’s financial assets and liabilities reflects the Company’s estimate of amounts that it would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from sources independent from the Company) and to minimize the use of unobservable inputs (the Company’s assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities: | ||||||||||||||||
Level 1: | Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. | |||||||||||||||
Level 2: | Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. | |||||||||||||||
Level 3: | Unobservable inputs based on the Company’s assessment of the assumptions that market participants would use in pricing the asset or liability. | |||||||||||||||
The Company’s investment strategy is focused on capital preservation. The Company invests in instruments that meet the credit quality standards outlined in the Company’s investment policy. This policy also limits the amount of credit exposure to any one issue or type of instrument. As of December 31, 2013, the Company’s investments were in money market funds, short-term government-sponsored enterprise securities, corporate debt securities and commercial paper. | ||||||||||||||||
As of December 31, 2013, all of the Company’s financial assets that were subject to fair value measurements were valued using observable inputs. The Company’s financial assets valued based on Level 1 inputs consisted of a money market funds and government-sponsored enterprise securities. The Company’s financial assets valued based on Level 2 inputs consisted of corporate debt securities and commercial paper, which consisted of investments in highly-rated investment-grade corporations. During 2013, 2012 and 2011, the Company did not record an other-than-temporary impairment charge related to its financial assets. | ||||||||||||||||
The following table sets forth the Company’s financial assets subject to fair value measurements: | ||||||||||||||||
Fair Value Measurements as | ||||||||||||||||
of December 31, 2013 | ||||||||||||||||
Fair Value Hierarchy | ||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||||
(in thousands) | ||||||||||||||||
Financial assets carried at fair value: | ||||||||||||||||
Cash equivalents: | ||||||||||||||||
Money market funds | $ | 255,689 | $ | 255,689 | $ | — | $ | — | ||||||||
Marketable securities: | ||||||||||||||||
Government-sponsored enterprise securities | 600,450 | 600,450 | — | — | ||||||||||||
Commercial paper | 83,493 | — | 83,493 | — | ||||||||||||
Corporate debt securities | 211,834 | — | 211,834 | — | ||||||||||||
Total | $ | 1,151,466 | $ | 856,139 | $ | 295,327 | $ | — | ||||||||
Marketable_Securities
Marketable Securities | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Cash and Cash Equivalents [Abstract] | ' | |||||||||||||||
Marketable Securities | ' | |||||||||||||||
Marketable Securities | ||||||||||||||||
A summary of the Company’s cash, cash equivalents and marketable securities is shown below: | ||||||||||||||||
Amortized Cost | Gross | Gross | Fair Value | |||||||||||||
Unrealized | Unrealized | |||||||||||||||
Gains | Losses | |||||||||||||||
(in thousands) | ||||||||||||||||
31-Dec-13 | ||||||||||||||||
Cash and cash equivalents: | ||||||||||||||||
Cash and money market funds | $ | 569,299 | $ | — | $ | — | $ | 569,299 | ||||||||
Total cash and cash equivalents | $ | 569,299 | $ | — | $ | — | $ | 569,299 | ||||||||
Marketable securities: | ||||||||||||||||
Government-sponsored enterprise securities (due within 1 year) | $ | 600,496 | $ | 7 | $ | (53 | ) | $ | 600,450 | |||||||
Commercial paper (due within 1 year) | 83,384 | 109 | — | 83,493 | ||||||||||||
Corporate debt securities (due within 1 year) | 189,674 | 14 | (34 | ) | 189,654 | |||||||||||
Corporate debt securities (due after 1 year through 5 years) | 22,181 | 6 | (7 | ) | 22,180 | |||||||||||
Total marketable securities | $ | 895,735 | $ | 136 | $ | (94 | ) | $ | 895,777 | |||||||
Total cash, cash equivalents and marketable securities | $ | 1,465,034 | $ | 136 | $ | (94 | ) | $ | 1,465,076 | |||||||
31-Dec-12 | ||||||||||||||||
Cash and cash equivalents: | ||||||||||||||||
Cash and money market funds | $ | 489,407 | $ | — | $ | — | $ | 489,407 | ||||||||
Total cash and cash equivalents | $ | 489,407 | $ | — | $ | — | $ | 489,407 | ||||||||
Marketable securities: | ||||||||||||||||
U.S. Treasury securities (due within 1 year) | $ | 111,350 | $ | 2 | $ | (2 | ) | $ | 111,350 | |||||||
Government-sponsored enterprise securities (due within 1 year) | 440,181 | 49 | (5 | ) | 440,225 | |||||||||||
Commercial paper (due within 1 year) | 225,294 | 155 | — | 225,449 | ||||||||||||
Corporate debt securities (due within 1 year) | 15,429 | 1 | (1 | ) | 15,429 | |||||||||||
Corporate debt securities (due after 1 year through 5 years) | 39,358 | 10 | (13 | ) | 39,355 | |||||||||||
Total marketable securities | $ | 831,612 | $ | 217 | $ | (21 | ) | $ | 831,808 | |||||||
Total cash, cash equivalents and marketable securities | $ | 1,321,019 | $ | 217 | $ | (21 | ) | $ | 1,321,215 | |||||||
Alios’ $70.0 million of cash and money market funds as of December 31, 2012, recorded on the Company’s consolidated balance sheet in “Restricted cash and cash equivalents (Alios),” are not included in the above table. | ||||||||||||||||
In December 2013, the Company initiated a hedging program intended to mitigate the changes in foreign exchange rates for a portion of the Company’s product revenues denominated in Euros, which included foreign currency forward contracts that were designated as cash flow hedges. The notional amount of Euro denominated foreign currency forward contracts as of December 31, 2013 was $17.5 million. The changes in fair value of these foreign currency forward contracts included in accumulated other comprehensive loss and the gross fair value of foreign currency forward assets and liabilities included on the consolidated balance sheet as of December 31, 2013 were not material. |
Accumulated_Other_Comprehensiv
Accumulated Other Comprehensive Loss | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Equity [Abstract] | ' | |||||||||||||||
Accumulated Other Comprehensive Loss | ' | |||||||||||||||
Accumulated Other Comprehensive Loss | ||||||||||||||||
The following table summarizes the changes in accumulated other comprehensive loss by component: | ||||||||||||||||
Foreign currency translation adjustment | Unrealized holding gains on marketable securities | Unrealized losses on foreign currency forward contracts | Total | |||||||||||||
(in thousands) | ||||||||||||||||
Balance at December 31, 2012 | $ | (746 | ) | $ | 196 | $ | — | $ | (550 | ) | ||||||
Other comprehensive income (loss) before reclassifications | 421 | (154 | ) | (23 | ) | 244 | ||||||||||
Amounts reclassified from accumulated other comprehensive loss | — | — | — | — | ||||||||||||
Net current period other comprehensive income (loss) | 421 | (154 | ) | (23 | ) | 244 | ||||||||||
Balance at December 31, 2013 | $ | (325 | ) | $ | 42 | $ | (23 | ) | $ | (306 | ) | |||||
For the year ended December 31, 2013, there were no amounts reclassified from accumulated other comprehensive loss. |
Inventories
Inventories | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Inventory Disclosure [Abstract] | ' | |||||||
Inventories | ' | |||||||
Inventories | ||||||||
Inventories consisted of the following: | ||||||||
As of December 31, | ||||||||
2013 | 2012 | |||||||
(in thousands) | ||||||||
Raw materials | $ | 489 | $ | 3,754 | ||||
Work-in-process | 9,981 | 11,317 | ||||||
Finished goods | 3,677 | 15,393 | ||||||
Total | $ | 14,147 | $ | 30,464 | ||||
In 2013, the Company recorded within cost of product revenues $10.4 million of write-offs for excess and obsolete inventories. In 2012, the Company recorded within cost of product revenues $133.2 million of write-offs for excess and obsolete INCIVEK inventories related to declining sales. The write-offs for excess and obsolete inventories of $10.4 million and $133.2 million in 2013 and 2012, respectively, affected the net loss attributable to Vertex per share, net of tax, by $0.05 and $0.61 in 2013 and 2012, respectively. |
Property_and_Equipment
Property and Equipment | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||
Property and Equipment | ' | |||||||
Property and Equipment | ||||||||
Property and equipment, net consisted of the following: | ||||||||
As of December 31, | ||||||||
2013 | 2012 | |||||||
(in thousands) | ||||||||
Buildings | $ | 506,056 | $ | — | ||||
Furniture and equipment | 190,555 | 173,766 | ||||||
Leasehold improvements | 163,019 | 123,770 | ||||||
Software | 102,520 | 101,276 | ||||||
Computers | 43,096 | 40,779 | ||||||
Construction-in-process | — | 290,703 | ||||||
Total property and equipment, gross | 1,005,246 | 730,294 | ||||||
Less: accumulated depreciation | (308,335 | ) | (296,685 | ) | ||||
Total property and equipment, net | $ | 696,911 | $ | 433,609 | ||||
Buildings as of December 31, 2013 and construction-in-process as of December 31, 2012, related to construction costs for the buildings at Fan Pier, which were placed in service in 2013. Please refer to Note I, "Fan Pier Leases," for further information. | ||||||||
Total property and equipment, gross, as of December 31, 2013 and 2012, included $76.4 million and $30.1 million, respectively, for property and equipment recorded under capital leases. Accumulated depreciation, as of December 31, 2013 and 2012, included $3.8 million and $1.1 million, respectively, for property and equipment recorded under capital leases. Included in property and equipment, net as of December 31, 2013 were $5.5 million and $0.5 million in capitalized internally developed software costs and related amortization, respectively. There were no such costs included in property and equipment, net as of December 31, 2012. | ||||||||
The Company recorded depreciation expense of $47.3 million, $35.7 million and $28.9 million, respectively, in 2013, 2012 and 2011. |
Fan_Pier_Leases
Fan Pier Leases | 12 Months Ended |
Dec. 31, 2013 | |
Fan Pier Leases [Abstract] | ' |
Fan Pier Leases | ' |
Fan Pier Leases | |
In 2011, the Company entered into two lease agreements, pursuant to which the Company leases approximately 1.1 million square feet of office and laboratory space in two buildings (the "Buildings") at Fan Pier in Boston, Massachusetts (the “Fan Pier Leases”). The Company commenced lease payments in December 2013, and will make lease payments pursuant to the Fan Pier Leases through December 2028. The Company has an option to extend the term of the Fan Pier Leases for an additional 10 years. | |
Because the Company was involved in the construction project, including having responsibility to pay for a portion of the costs of finish work and structural elements of the Buildings, the Company was deemed for accounting purposes to be the owner of the Buildings during the construction period. Therefore, the Company recorded project construction costs incurred by the landlord as an asset and a related financing obligation during the construction period. The Company evaluated the Fan Pier Leases in the fourth quarter of 2013 and determined that the Fan Pier Leases did not meet the criteria for “sale-leaseback” treatment. This determination was based on, among other things, the Company's continuing involvement with the property in the form of non-recourse financing to the lessor. Accordingly, the Company began depreciating the asset and incurring interest expense related to the financing obligation during the fourth quarter of 2013. The Company bifurcates its lease payments pursuant to the Fan Pier Leases into (i) a portion that is allocated to the Buildings and (ii) a portion that is allocated to the land on which the Buildings were constructed. The portion of the lease obligations allocated to the land is treated as an operating lease that commenced in 2011. | |
Property and equipment, net, included $506.1 million and $290.7 million as of December 31, 2013 and 2012, respectively, related to construction costs for the Buildings. The construction financing lease obligations related to the Buildings on the Company's consolidated balance sheets were $440.9 million and $268.0 million, respectively, as of December 31, 2013 and 2012. |
Intangible_Assets_and_Goodwill
Intangible Assets and Goodwill | 12 Months Ended |
Dec. 31, 2013 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ' |
Intangible Assets and Goodwill | ' |
Intangible Assets and Goodwill | |
Intangible Assets | |
As of December 31, 2013, the Company had no intangible assets recorded on its consolidated balance sheet. The intangible assets that were previously reflected on the Company's consolidated balance sheets related to drug candidates for the treatment of HCV infection. The field of HCV infection treatment is highly competitive and characterized by rapid technological advances and the development of drug candidates for the treatment of HCV infection is subject to numerous risks. Two of the Company's competitors received approval in the fourth quarter of 2013 for new treatment regimens for HCV infection that include pegylated-interferon and ribavirin, and several of the Company's competitors are conducting Phase 3 clinical trials evaluating all-oral combinations of their drug candidates for the treatment of HCV infection. | |
ViroChem Acquisition | |
As of December 31, 2010, the intangible assets acquired from ViroChem that were reflected on the Company's consolidated balance sheet related to two drug candidates, VX-222 and VX-759. VX-222 and VX-759 had estimated fair values on December 31, 2010 of $412.9 million and $105.8 million, respectively. In the third quarter of 2011, the Company determined that the fair value of VX-759 had become impaired and that its fair value was zero. As a result, the Company recorded an impairment charge in 2011 of $105.8 million that was reflected as an intangible asset impairment charge on the Company's consolidated statement of operations. In connection with this impairment charge, the Company recorded a benefit from income taxes of $32.7 million. In 2011, the decrease to the Company's net income attributable to Vertex related to this impairment charge, net of tax credit, was $73.1 million, and the net decrease to the Company's net income per share attributable to Vertex common shareholders was $0.35 per diluted share. | |
In 2013, the Company determined that there were indicators that the value of the VX-222 intangible asset had become impaired. This determination was based on (a) preliminary safety, tolerability and efficacy data from a Phase 2 clinical trial of VX-222, telaprevir and ribavirin, which was received in March 2013 and analyzed through April 2013 and (b) a review of the existing and emerging data regarding all-oral regimens for HCV infection being developed by the Company's competitors that appeared to be generally well tolerated with high sustained viral response rates for treatment-naïve patients with genotype 1 HCV infection. After evaluating the data from this Phase 2 clinical trial, the Company determined that regimens containing VX-222 were unlikely to be competitive with the treatment regimens being developed by the Company's competitors. The Company evaluated the fair value of VX-222 from the perspective of a market participant and based on this analysis determined that the fair value of VX-222 was zero as of March 31, 2013. Accordingly, the Company recorded a $412.9 million impairment charge in 2013. In connection with this impairment charge, the Company recorded a credit of $127.6 million in its provision for income taxes. In 2013, the increase to the Company's net loss attributable to Vertex related to this impairment charge, net of the tax credit, was $285.3 million, and the net increase to the Company's net loss per share attributable to Vertex common shareholders was $1.27 per share. | |
Alios Collaboration | |
In June 2011, the Company recorded $250.6 million of intangible assets on its consolidated balance sheet based on the Company's estimate of the fair value of Alios' HCV nucleotide analogue program, including the intellectual property related to ALS-2200 and ALS-2158. In the third quarter of 2012, after the Company discontinued the development of ALS-2158, the Company evaluated the Alios HCV nucleotide analogue program for impairment. The Company determined that there was no impairment to the program in the third quarter of 2012 because of the advancement of ALS-2200 (now formulated as VX-135). | |
In July 2013, the FDA placed a partial clinical hold on VX-135, which is being evaluated in Phase 2 clinical development. The partial clinical hold, which prevents the Company from further evaluation of VX-135 in the United States, remains in place as of the date of this filing. | |
In connection with preparing its financial statements for 2013, the Company determined that there were indicators that the value of the HCV nucleotide analogue program intangible asset had become impaired. This determination was based on, among other factors, (a) safety, tolerability and efficacy data from a Phase 2a clinical trial of VX-135 in combination with daclatasvir that the Company received in late December 2013 and analyzed and announced in January 2014, (b) the continuing partial clinical hold on VX-135 by the FDA, (c) a review of the existing and emerging data regarding all-oral regimens for HCV infection being developed by the Company's competitors, and (d) the risks associated with establishing collaborations for the potential late-stage development of a combination regimen containing VX-135 and drug candidates controlled by third parties. Based on these revised estimates, the Company evaluated the fair value of VX-135 from the perspective of a market participant and determined that the fair value of VX-135 was zero as of December 31, 2013. Accordingly, a $250.6 million impairment charge and a benefit from income taxes of $102.1 million was recorded in the fourth quarter of 2013. | |
Goodwill | |
As of December 31, 2013 and 2012, goodwill of $31.0 million was recorded on the Company's consolidated balance sheets. There was no change to goodwill during the year ended December 31, 2013. |
Accrued_Expenses_and_Other_Lia
Accrued Expenses and Other Liabilities, Current Portion | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Payables and Accruals [Abstract] | ' | |||||||
Accrued Expenses and Other Liabilities, Current Portion | ' | |||||||
Accrued Expenses and Other Liabilities, Current Portion | ||||||||
Accrued expenses consisted of the following: | ||||||||
As of December 31, | ||||||||
2013 | 2012 | |||||||
(in thousands) | ||||||||
Product revenue allowances | $ | 85,510 | $ | 69,936 | ||||
Payroll and benefits | 76,785 | 62,140 | ||||||
Research, development and commercial contract costs | 52,468 | 63,960 | ||||||
Royalty payable | 18,334 | 29,007 | ||||||
Other | 16,241 | 18,932 | ||||||
Professional fees | 10,593 | 11,226 | ||||||
Taxes payable | 8,362 | 2,182 | ||||||
Unrecognized tax benefits | 2,784 | 4,106 | ||||||
Interest | — | 3,395 | ||||||
Total | $ | 271,077 | $ | 264,884 | ||||
Other liabilities, current portion consisted of the following: | ||||||||
As of December 31, | ||||||||
2013 | 2012 | |||||||
(in thousands) | ||||||||
Deferred rent | $ | 16,652 | $ | 14,302 | ||||
Customer deposits | 7,692 | — | ||||||
Other | 392 | 5,400 | ||||||
Total | $ | 24,736 | $ | 19,702 | ||||
Convertible_Senior_Subordinate
Convertible Senior Subordinated Notes Convertible Senior Subordinated Notes | 12 Months Ended |
Dec. 31, 2013 | |
Debt Disclosure [Abstract] | ' |
Convertible Senior Subordinated Notes | ' |
Convertible Senior Subordinated Notes | |
In September 2010, the Company completed an offering of $400.0 million in aggregate principal amount of 3.35% convertible senior subordinated notes due 2015 Notes (the "2015 Notes"). This offering resulted in $391.6 million of net proceeds to the Company. The underwriting discount and other expenses of $8.4 million were recorded as debt issuance costs and were included in other assets on the Company’s consolidated balance sheets. The 2015 Notes bore interest at the rate of 3.35% per annum, and the Company was required to make semi-annual interest payments on the outstanding principal balance of the 2015 Notes on April 1 and October 1 of each year. | |
The 2015 Notes were convertible at any time, at the option of the holder, into common stock at a price equal to approximately $48.83 per share, or 20.4794 shares of common stock per $1,000 principal amount of the 2015 Notes, subject to adjustment. If the closing price of the Company’s common stock exceeded 130% of the conversion price for at least 20 trading days within a period of 30 consecutive trading days, the Company had the right to redeem the 2015 Notes at its option at a redemption price equal to 100% of the principal amount of the 2015 Notes to be redeemed. | |
In the second quarter of 2013, the Company's common stock exceeded 130% of the conversion price of the 2015 Notes for at least 20 trading days within a period of 30 consecutive trading days, and the Company notified the holders of the 2015 Notes that it would redeem the 2015 Notes on June 17, 2013. In response to the Company's call of the 2015 Notes for redemption, in accordance with the provisions of the 2015 Notes, the holders of $399.8 million in aggregate principal amount of 2015 Notes elected to convert their 2015 Notes into the Company's common stock at the conversion price of approximately $48.83 per share. As a result of these conversions, the Company issued 8,188,448 shares of common stock. The remaining $0.2 million in aggregate principal amount of 2015 Notes was redeemed on June 17, 2013. | |
Pursuant to the terms of the 2015 Notes, the Company made an additional payment of $16.75 per $1,000 principal amount, payable in shares of the Company’s common stock, to the holders of the 2015 Notes that converted or redeemed their 2015 Notes after the Company called the 2015 Notes for redemption. These payments resulted in the issuance of an additional 87,109 shares of the Company's common stock. In the second quarter of 2013, the Company recognized an aggregate of $6.7 million in interest expense related to the 2015 Notes. Unamortized debt issuance costs for the 2015 Notes of $4.2 million were recorded as an offset to additional paid-in capital. |
Common_Stock_Preferred_Stock_a
Common Stock, Preferred Stock and Equity Plans | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Common Stock, Preferred Stock and Equity Plans | ' | ||||||||||||||||
Common Stock, Preferred Stock and Equity Plans | ' | ||||||||||||||||
Common Stock, Preferred Stock and Equity Plans | |||||||||||||||||
The Company is authorized to issue 300,000,000 shares of common stock. Holders of common stock are entitled to one vote per share. Holders of common stock are entitled to receive dividends, if and when declared by the Company’s Board of Directors, and to share ratably in the Company’s assets legally available for distribution to the Company’s shareholders in the event of liquidation. Holders of common stock have no preemptive, subscription, redemption or conversion rights. The holders of common stock do not have cumulative voting rights. | |||||||||||||||||
The Company is authorized to issue 1,000,000 shares of preferred stock in one or more series and to fix the powers, designations, preferences and relative participating, option or other rights thereof, including dividend rights, conversion rights, voting rights, redemption terms, liquidation preferences and the number of shares constituting any series, without any further vote or action by the Company's shareholders. As of December 31, 2013 and 2012, the Company had no shares of preferred stock issued or outstanding. | |||||||||||||||||
Stock and Option Plans | |||||||||||||||||
The purpose of each of the Company’s stock and option plans is to attract, retain and motivate its employees, consultants and directors. Awards granted under these plans can be incentive stock options (“ISOs”), nonstatutory stock options (“NSOs”), restricted stock (“RSs”), restricted stock units (“RSUs”) or other equity-based awards, as specified in the individual plans. | |||||||||||||||||
Shares issued under all of the Company’s plans are funded through the issuance of new shares. The following table contains information about the Company’s equity plans: | |||||||||||||||||
As of December 31, 2013 | |||||||||||||||||
Title of Plan | Group Eligible | Type of Award | Awards | Additional Awards | |||||||||||||
Granted | Outstanding | Authorized for | |||||||||||||||
Grant | |||||||||||||||||
2013 Stock and Option Plan | Employees, Non-employee Directors and Consultants | NSO, ISO, | 1,170,827 | 2,129,173 | |||||||||||||
RS and RSU | |||||||||||||||||
2006 Stock and Option Plan | Employees, Non-employee Directors and Consultants | NSO, ISO, | 15,748,949 | 3,282,178 | |||||||||||||
RS and RSU | |||||||||||||||||
1996 Stock and Option Plan | Employees, Non-employee Directors, Advisors and Consultants | NSO, ISO and RS | 974,303 | — | |||||||||||||
Total | 17,894,079 | 5,411,351 | |||||||||||||||
All options granted under the Company’s 2013 Stock and Option Plan ("2013 Plan"), 2006 Stock and Option Plan (“2006 Plan”) and 1996 Stock and Option Plan were granted with an exercise price equal to the fair value of the underlying common stock on the date of grant. As of December 31, 2013, the stock and option plans under which the Company makes new equity awards are the Company’s 2006 Plan and 2013 Plan. Under the 2006 Plan and the 2013 Plan, no stock options can be awarded with an exercise price less than the fair market value on the date of grant. The Company’s shareholders authorized 3,300,000 shares for issuance pursuant to the 2013 Plan in 2013 and approved an increase in the number of shares authorized for issuance pursuant to the 2006 Plan of 3,000,000 shares in 2012. | |||||||||||||||||
During the three years ended December 31, 2013, grants to current employees and directors had a grant date that was the same as the date the award was approved by the Company’s Board of Directors. During the three years ended December 31, 2013, for grants to new employees and directors, the date of grant for awards was the employee’s first day of employment or the date the director was elected to the Company’s Board of Directors. All options awarded under the Company’s stock and option plans expire not more than ten years from the grant date. | |||||||||||||||||
During the three years ended December 31, 2013, all shares of outstanding restricted stock and restricted stock units have been granted at a price equal to $0.01, the par value of the Company’s common stock. Vesting of options, restricted stock and restricted stock units generally is ratable over specified periods, usually four years, and is determined by the Company’s Board of Directors. | |||||||||||||||||
The following table summarizes information related to the outstanding and exercisable options during the year ended December 31, 2013: | |||||||||||||||||
Stock Options | Weighted-average | Weighted-average | Aggregate Intrinsic | ||||||||||||||
Exercise Price | Remaining | Value | |||||||||||||||
Contractual Life | |||||||||||||||||
(in thousands) | (per share) | (in years) | (in thousands) | ||||||||||||||
Outstanding at December 31, 2012 | 19,726 | $ | 38.09 | ||||||||||||||
Granted | 4,840 | $ | 57.87 | ||||||||||||||
Exercised | (6,995 | ) | $ | 35.28 | |||||||||||||
Forfeited | (1,822 | ) | $ | 46.89 | |||||||||||||
Expired | (20 | ) | $ | 46.64 | |||||||||||||
Outstanding at December 31, 2013 | 15,729 | $ | 44.4 | 6.67 | $ | 481,311 | |||||||||||
Exercisable at December 31, 2013 | 7,950 | $ | 38.84 | 5.13 | $ | 283,146 | |||||||||||
Exercisable and Expected to Vest at December 31, 2013 | 14,967 | $ | 43.95 | 6.56 | $ | 463,885 | |||||||||||
The aggregate intrinsic value in the table above represents the total pre-tax amount, net of exercise price, that would have been received by option holders if all option holders had exercised all options with an exercise price lower than the market price on December 31, 2013, which was $74.21 based on the average of the high and low price of the Company’s common stock on that date. | |||||||||||||||||
The total intrinsic value (the amount by which the fair market value exceeded the exercise price) of stock options exercised during 2013, 2012 and 2011 was $291.6 million, $148.7 million and $90.5 million, respectively. The total cash received by the Company as a result of employee stock option exercises during 2013, 2012 and 2011 was $246.8 million, $172.8 million and $109.6 million, respectively. | |||||||||||||||||
The following table summarizes information about stock options outstanding and exercisable at December 31, 2013: | |||||||||||||||||
Options Outstanding | Options Exercisable | ||||||||||||||||
Range of Exercise Prices | Number | Weighted-average | Weighted-average | Number | Weighted-average | ||||||||||||
Outstanding | Remaining | Exercise Price | Exercisable | Exercise Price | |||||||||||||
Contractual Life | |||||||||||||||||
(in thousands) | (in years) | (per share) | (in thousands) | (per share) | |||||||||||||
$ 9.09–$20.00 | 432 | 2.37 | $ | 15.37 | 432 | $ | 15.37 | ||||||||||
$20.01–$30.00 | 1,055 | 5.74 | $ | 29.38 | 812 | $ | 29.23 | ||||||||||
$30.01–$40.00 | 6,842 | 5.07 | $ | 36.55 | 4,773 | $ | 36.06 | ||||||||||
$40.01–$50.00 | 4,136 | 8.74 | $ | 46.32 | 787 | $ | 46.62 | ||||||||||
$50.01–$60.00 | 1,713 | 7.16 | $ | 53.78 | 874 | $ | 54.35 | ||||||||||
$60.01–$70.00 | 80 | 9.08 | $ | 65.54 | 14 | $ | 63.2 | ||||||||||
$70.01-$80.00 | 87 | 9.31 | $ | 77.55 | 9 | $ | 77.73 | ||||||||||
$80.01–$88.18 | 1,384 | 9.5 | $ | 83.11 | 249 | $ | 82.13 | ||||||||||
Total | 15,729 | 6.67 | $ | 44.4 | 7,950 | $ | 38.84 | ||||||||||
The following table summarizes the restricted stock activity of the Company during the year ended December 31, 2013: | |||||||||||||||||
Restricted | Weighted-average | ||||||||||||||||
Stock | Grant-date | ||||||||||||||||
Fair Value | |||||||||||||||||
(in thousands) | (per share) | ||||||||||||||||
Unvested at December 31, 2012 | 2,270 | $ | 42.92 | ||||||||||||||
Granted | 1,356 | $ | 62.16 | ||||||||||||||
Vested | (800 | ) | $ | 42.27 | |||||||||||||
Cancelled | (780 | ) | $ | 51.47 | |||||||||||||
Unvested at December 31, 2013 | 2,046 | $ | 52.66 | ||||||||||||||
The total fair value of restricted stock that vested during 2013, 2012 and 2011 (measured on the date of vesting) was $50.9 million, $41.1 million and $34.6 million, respectively. | |||||||||||||||||
Employee Stock Purchase Plan | |||||||||||||||||
The Company has an employee stock purchase plan (the “ESPP”). The ESPP permits eligible employees to enroll in a twelve-month offering period comprising two six-month purchase periods. Participants may purchase shares of the Company’s common stock, through payroll deductions, at a price equal to 85% of the fair market value of the common stock on the first day of the applicable twelve-month offering period, or the last day of the applicable six-month purchase period, whichever is lower. Purchase dates under the ESPP occur on or about May 14 and November 14 of each year. In 2012, the Company's shareholders approved an increase in the number of shares of common stock authorized for issuance pursuant to the ESPP. As of December 31, 2013, there were 1,753,381 shares of common stock authorized for issuance pursuant to the ESPP. | |||||||||||||||||
In 2013, the following shares were issued to employees under the ESPP: | |||||||||||||||||
Year Ended December 31, 2013 | |||||||||||||||||
(in thousands, | |||||||||||||||||
except per share amount) | |||||||||||||||||
Number of shares | 527 | ||||||||||||||||
Average price paid per share | $ | 36.21 | |||||||||||||||
Stockbased_Compensation_Expens
Stock-based Compensation Expense | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||
Stock-based Compensation Expense | ' | |||||||||||
Stock-based Compensation Expense | ||||||||||||
The Company recognizes share-based payments to employees as compensation expense using the fair value method. The fair value of stock options and shares purchased pursuant to the ESPP is calculated using the Black-Scholes option pricing model. The fair value of restricted stock and restricted stock units typically is based on the intrinsic value on the date of grant. Stock-based compensation, measured at the grant date based on the fair value of the award, is typically recognized as expense ratably over the service period. The expense recognized over the service period includes an estimate of awards that will be forfeited. | ||||||||||||
The effect of stock-based compensation expense during the three years ended December 31, 2013 was as follows: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(in thousands) | ||||||||||||
Stock-based compensation expense by line item: | ||||||||||||
Research and development expenses | $ | 81,467 | $ | 71,533 | $ | 75,574 | ||||||
Sales, general and administrative expenses | 45,836 | 42,752 | 42,652 | |||||||||
Total stock-based compensation expense included in costs and expenses | $ | 127,303 | $ | 114,285 | $ | 118,226 | ||||||
The stock-based compensation expense by type of award during the three years ended December 31, 2013 was as follows: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(in thousands) | ||||||||||||
Stock-based compensation expense by type of award: | ||||||||||||
Stock options | $ | 85,067 | $ | 79,047 | $ | 83,098 | ||||||
Restricted stock and restricted stock units | 36,479 | 29,194 | 30,708 | |||||||||
ESPP share issuances | 6,805 | 7,298 | 5,462 | |||||||||
Less: stock-based compensation expense capitalized to inventories | (1,048 | ) | (1,254 | ) | (1,042 | ) | ||||||
Total stock-based compensation expense included in costs and expenses | $ | 127,303 | $ | 114,285 | $ | 118,226 | ||||||
The Company capitalizes stock-based compensation expense to inventories, all of which is attributable to employees who supported the Company’s manufacturing operations for the Company's products. | ||||||||||||
The following table sets forth the Company’s unrecognized stock-based compensation expense, net of estimated forfeitures, as of December 31, 2013, by type of award and the weighted-average period over which that expense is expected to be recognized: | ||||||||||||
As of December 31, 2013 | ||||||||||||
Unrecognized Expense | Weighted-average | |||||||||||
Net of | Recognition | |||||||||||
Estimated Forfeitures | Period | |||||||||||
(in thousands) | (in years) | |||||||||||
Type of award: | ||||||||||||
Stock options | $ | 141,283 | 2.56 | |||||||||
Restricted stock and restricted stock units | $ | 73,490 | 2.47 | |||||||||
ESPP share issuances | $ | 5,956 | 0.67 | |||||||||
Stock Options | ||||||||||||
The Company issues stock options with service conditions, which are generally the vesting periods of the awards. In 2009, the Company also issued, to certain members of senior management, stock options with performance conditions that vested upon the satisfaction of the performance conditions by the end of the first quarter of 2012. The Company uses the Black-Scholes option pricing model to estimate the fair value of stock options at the grant date. The Black-Scholes option pricing model uses the option exercise price as well as estimates and assumptions related to the expected price volatility of the Company’s stock, the rate of return on risk-free investments, the expected period during which the options will be outstanding, and the expected dividend yield for the Company’s stock to estimate the fair value of a stock option on the grant date. The options granted during 2013, 2012 and 2011 had a weighted-average grant-date fair value per share of $25.79, $19.72 and $20.88, respectively. | ||||||||||||
The fair value of each option granted during 2013, 2012 and 2011 was estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Expected stock price volatility | 46.2 | % | 47.93 | % | 49.53 | % | ||||||
Risk-free interest rate | 1.25 | % | 0.95 | % | 2.09 | % | ||||||
Expected term of options (in years) | 5.81 | 5.78 | 5.74 | |||||||||
Expected annual dividends | — | — | — | |||||||||
The weighted-average valuation assumptions were determined as follows: | ||||||||||||
• | Expected stock price volatility: Options to purchase the Company’s stock with remaining terms of greater than one year are regularly traded in the market. Expected stock price volatility is calculated using the trailing one month average of daily implied volatilities prior to grant date. | |||||||||||
• | Risk-free interest rate: The Company bases the risk-free interest rate on the interest rate payable on U.S. Treasury securities in effect at the time of grant for a period that is commensurate with the assumed expected option term. | |||||||||||
• | Expected term of options: The expected term of options represents the period of time options are expected to be outstanding. The Company uses historical data to estimate employee exercise and post-vest termination behavior. The Company believes that all groups of employees exhibit similar exercise and post-vest termination behavior and therefore does not stratify employees into multiple groups in determining the expected term of options. | |||||||||||
• | Expected annual dividends: The estimate for annual dividends is $0.00 because the Company has not historically paid, and does not intend for the foreseeable future to pay, a dividend. | |||||||||||
Restricted Stock and Restricted Stock Units | ||||||||||||
The Company issues restricted stock and restricted stock units with service conditions, which are generally the vesting periods of the awards. The Company also issues, to certain members of senior management, restricted stock and restricted stock units that vest upon the earlier of the satisfaction of (i) a performance condition or (ii) a service condition. | ||||||||||||
Employee Stock Purchase Plan | ||||||||||||
The weighted-average fair value of each purchase right granted during 2013, 2012 and 2011 was $21.08, $12.90 and $9.80, respectively. The following table reflects the weighted-average assumptions used in the Black-Scholes option pricing model for 2013, 2012 and 2011: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Expected stock price volatility | 54.69 | % | 46.9 | % | 51.32 | % | ||||||
Risk-free interest rate | 0.08 | % | 0.16 | % | 0.08 | % | ||||||
Expected term (in years) | 0.74 | 0.74 | 0.72 | |||||||||
Expected annual dividends | — | — | — | |||||||||
The expected stock price volatility for ESPP offerings is based on implied volatility. The Company bases the risk-free interest rate on the interest rate payable on U.S. Treasury securities in effect at the time of grant for a period that is commensurate with the assumed expected term. The expected term represents purchases and purchase periods that take place within the offering period. The expected annual dividends estimate is $0.00 because the Company has not historically paid, and does not for the foreseeable future intend to pay, a dividend. |
September_2009_Financial_Trans
September 2009 Financial Transactions | 12 Months Ended | |||
Dec. 31, 2013 | ||||
September 2009 Financial Transactions | ' | |||
September 2009 Financial Transactions | ' | |||
September 2009 Financial Transactions | ||||
2012 Notes | ||||
In September 2009, the Company sold $155.0 million in aggregate of secured notes due 2012 (the “2012 Notes”) for an aggregate of $122.2 million pursuant to a note purchase agreement with Olmsted Park S.A. (the “Purchaser”). The 2012 Notes were issued at a discount and did not pay current interest prior to maturity. The 2012 Notes were scheduled to mature on October 31, 2012, subject to earlier mandatory redemption to the extent that specified milestone events set forth in the Company’s collaboration with Janssen occurred prior to October 31, 2012. In February 2011, the Company received a milestone payment of $50.0 million and subsequently redeemed $50.0 million of 2012 Notes pursuant to their terms. The remaining $105.0 million of 2012 Notes were redeemed on October 31, 2011, with the proceeds of milestone payments received from Janssen in October 2011. The 2012 Notes contained an embedded derivative related to the potential mandatory redemption or early repayment of the 2012 Notes at the face amount prior to their maturity date. The fair value of this embedded derivative was evaluated quarterly, with changes in the fair value of the embedded derivative resulting in a corresponding gain or loss. The Company recorded quarterly interest expense related to the 2012 Notes using the effective interest rate method. | ||||
Sale of Contingent Milestone Payments | ||||
In September 2009, the Company entered into two purchase agreements with the Purchaser pursuant to which the Company sold its rights to an aggregate of $95.0 million in contingent milestone payments under the Janssen agreement related to the launch of telaprevir in the European Union, for nonrefundable payments totaling $32.8 million. The Purchaser received the $95.0 million in milestone payments from Janssen in the fourth quarter of 2011. The Company determined that this sale of a future revenue stream should be accounted for as a liability. The fair value of the rights sold to the Purchaser pursuant to the purchase agreements was evaluated each reporting period until the payments were received in the fourth quarter of 2011, with changes in the fair value of the derivative instruments based on the probability of achieving the milestones, the timing of achieving the milestones or discount rates resulting in a corresponding gain or loss. | ||||
Expenses Related to September 2009 Financial Transactions | ||||
The Company had no expenses related to these transactions in 2013 or 2012. The table below sets forth the total expenses related to the September 2009 financial transactions for 2011: | ||||
2011 | ||||
(in thousands) | ||||
Expenses and Losses (Gains): | ||||
Interest expense related to 2012 Notes | $ | 21,687 | ||
Change in fair value of embedded derivative related to 2012 Notes | (400 | ) | ||
Change in fair value of free-standing derivatives related to the sale of milestone payments | 17,201 | |||
Total September 2009 financial transaction expenses | $ | 38,488 | ||
Sale_of_HIV_Protease_Inhibitor
Sale of HIV Protease Inhibitor Royalty Stream | 12 Months Ended |
Dec. 31, 2013 | |
Sale of HIV Protease Inhibitor Royalty Stream | ' |
Sale of HIV Protease Inhibitor Royalty Stream | ' |
Sale of HIV Protease Inhibitor Royalty Stream | |
In 2008, the Company sold to a third party its rights to receive royalty payments from GlaxoSmithKline plc, net of royalty amounts to be earned by and due to a third party, for a one-time cash payment of $160.0 million. These royalty payments relate to net sales of HIV protease inhibitors, which had been developed pursuant to a collaboration agreement between the Company and GlaxoSmithKline plc. As of December 31, 2013, the Company had $63.5 million in deferred revenues related to the one-time cash payment, which it is recognizing over the life of the collaboration agreement with GlaxoSmithKline plc based on the units-of-revenue method. In addition, the Company continues to recognize royalty revenues equal to the amount of the third-party subroyalty and an offsetting royalty expense for the third-party subroyalty payment. |
Income_Taxes
Income Taxes | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Income Tax Disclosure [Abstract] | ' | |||||||||||
Income Taxes | ' | |||||||||||
Income Taxes | ||||||||||||
The components of income (loss) before provision for (benefit from) income taxes during the three years ended December 31, 2013 consisted of the following: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(in thousands) | ||||||||||||
United States | $ | (390,009 | ) | $ | 256,816 | $ | 343,515 | |||||
Foreign | (586,108 | ) | (269,197 | ) | (283,070 | ) | ||||||
Income (loss) before provision for (benefit from) income taxes | $ | (976,117 | ) | $ | (12,381 | ) | $ | 60,445 | ||||
The components of the provision for (benefit from) income taxes during the three years ended December 31, 2013 consisted of the following: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(in thousands) | ||||||||||||
Current taxes: | ||||||||||||
United States | $ | (11,420 | ) | $ | 2,057 | $ | 22,275 | |||||
Foreign | 1,084 | (1,865 | ) | (561 | ) | |||||||
State | 2,136 | 1,902 | 8,655 | |||||||||
Total current taxes | $ | (8,200 | ) | $ | 2,094 | $ | 30,369 | |||||
Deferred taxes: | ||||||||||||
United States | $ | (131,281 | ) | $ | 31,308 | $ | 19,629 | |||||
Foreign | (127,587 | ) | — | (32,692 | ) | |||||||
State | (21,499 | ) | 5,352 | 1,960 | ||||||||
Total deferred taxes | $ | (280,367 | ) | $ | 36,660 | $ | (11,103 | ) | ||||
Provision for (benefit from) income taxes | $ | (288,567 | ) | $ | 38,754 | $ | 19,266 | |||||
The difference between the Company’s “expected” tax provision (benefit), as computed by applying the U.S. federal corporate tax rate of 35% to income (loss) before provision for (benefit from) income taxes, and actual tax is reconciled as follows: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(in thousands) | ||||||||||||
Income (loss) before provision for (benefit from) income taxes | $ | (976,117 | ) | $ | (12,381 | ) | $ | 60,445 | ||||
Expected tax provision (benefit) | (341,641 | ) | (4,333 | ) | 21,156 | |||||||
State taxes, net of federal benefit | (19,268 | ) | 7,075 | 10,624 | ||||||||
Foreign rate differential | 72,961 | 62,425 | 43,629 | |||||||||
Tax credits | (16,775 | ) | (1,980 | ) | (51,086 | ) | ||||||
Unbenefited operating losses | (43,570 | ) | (30,364 | ) | (6,286 | ) | ||||||
Non-deductible expenses | 9,614 | 3,198 | 1,953 | |||||||||
Rate change | 50,076 | 3,275 | — | |||||||||
Other | 36 | (542 | ) | (724 | ) | |||||||
Provision for (benefit from) income taxes | $ | (288,567 | ) | $ | 38,754 | $ | 19,266 | |||||
Deferred tax assets and liabilities are determined based on the difference between financial statement and tax bases using enacted tax rates in effect for the year in which the differences are expected to reverse. The components of the deferred taxes were as follows: | ||||||||||||
As of December 31, | ||||||||||||
2013 | 2012 | |||||||||||
(in thousands) | ||||||||||||
Deferred tax assets: | ||||||||||||
Net operating loss | $ | 850,946 | $ | 777,687 | ||||||||
Tax credit carryforwards | 180,380 | 147,074 | ||||||||||
Property and equipment | — | 10,701 | ||||||||||
Intangible assets | 26,105 | 63,353 | ||||||||||
Deferred revenues | 25,158 | 44,867 | ||||||||||
Stock-based compensation | 63,521 | 83,979 | ||||||||||
Inventories | 26,278 | 56,564 | ||||||||||
Accrued expenses | 52,470 | 27,945 | ||||||||||
Currency translation adjustment | 217 | — | ||||||||||
Construction financing lease obligation | 152,688 | — | ||||||||||
Gross deferred tax assets | 1,377,763 | 1,212,170 | ||||||||||
Valuation allowance | (1,243,664 | ) | (1,211,561 | ) | ||||||||
Total deferred tax assets | 134,099 | 609 | ||||||||||
Deferred tax liabilities: | ||||||||||||
Property and equipment | (134,099 | ) | — | |||||||||
Unrealized gain | — | (376 | ) | |||||||||
Contingent milestone and royalty payment obligation | — | (50,904 | ) | |||||||||
Acquired intangibles | — | (229,696 | ) | |||||||||
Net deferred tax liabilities | $ | — | $ | (280,367 | ) | |||||||
For federal income tax purposes, as of December 31, 2013, the Company has net operating loss carryforwards of approximately $2.7 billion and tax credits of $120.1 million, which may be used to offset future federal income and tax liability, respectively. Approximately $694.8 million of the federal net operating loss carryforward will result in an increase to additional paid-in capital if and when these carryforwards are used to reduce income taxes payable. | ||||||||||||
For state income tax purposes, the Company has net operating loss carryforwards of approximately $966.8 million and tax credits of $66.9 million, which may be used to offset future state income and tax liability, respectively. Approximately $204.5 million of the state net operating loss carryforward will result in an increase to additional paid-in capital if and when these carryforwards are used to reduce state income taxes payable. | ||||||||||||
These federal and state operating loss carryforwards and tax credits expire at various dates through 2033. After consideration of all the evidence, both positive and negative, the Company continues to maintain a valuation allowance for the full amount of the 2013 deferred tax asset because it is more likely than not that the deferred tax asset will not be realized. In future periods, if management determines that it is more likely than not that the deferred tax asset will be realized, (i) the valuation allowance would be decreased, (ii) a portion or all of the deferred tax asset would be reflected on the Company’s consolidated balance sheet and (iii) the Company would record non-cash benefits in its consolidated statements of operations related to the reflection of the deferred tax asset on its consolidated balance sheets. | ||||||||||||
The valuation allowance increased by $32.1 million from December 31, 2012 to December 31, 2013 primarily due to an increase in net operating losses and credits. | ||||||||||||
Unrecognized tax benefits during the two years ended December 31, 2013 consisted of the following: | ||||||||||||
2013 | 2012 | |||||||||||
(in thousands) | ||||||||||||
Unrecognized tax benefits beginning of year | $ | 4,106 | $ | 4,360 | ||||||||
Gross change for current year positions | 1,325 | 598 | ||||||||||
Increase for prior period positions | — | — | ||||||||||
Decrease for prior period positions | (290 | ) | — | |||||||||
Decrease due to settlements and payments | — | — | ||||||||||
Decrease due to statute limitations | (185 | ) | (852 | ) | ||||||||
Deconsolidation of Alios | (2,932 | ) | — | |||||||||
Unrecognized tax benefits end of year | $ | 2,024 | $ | 4,106 | ||||||||
The Company had gross unrecognized tax benefits of $2.0 million and $4.1 million, respectively, as of December 31, 2013 and 2012. At December 31, 2013, $2.0 million represented the amount of unrecognized tax benefits that, if recognized, would result in a reduction of the Company’s effective tax rate. The Company recognizes interest and penalties related to income taxes as a component of income tax expense. As of December 31, 2013, no interest and penalties have been accrued. In 2014, it is reasonably possible that the Company will reduce the balance of its unrecognized tax benefits by approximately $0.5 million due to the application of statute of limitations and settlements with taxing authorities, all of which would reduce the Company’s effective tax rate. | ||||||||||||
The Company files United States federal income tax returns and income tax returns in various state, local and foreign jurisdictions. The Company is no longer subject to any tax assessment from an income tax examination in the United States before 2008 or any other major taxing jurisdiction for years before 2006, except where the Company has net operating losses or tax credit carryforwards that originate before 2006. The Company is currently under examination by Revenue Quebec and the Canada Revenue Agency for the year ended December 31, 2011. No adjustments have been reported. The Company is not under examination by any other jurisdictions for any tax year. | ||||||||||||
At December 31, 2013, foreign earnings, which were not significant, have been retained indefinitely by foreign subsidiary companies for reinvestment; therefore, no provision has been made for income taxes that would be payable upon the distribution of such earnings, and it would not be practicable to determine the amount of the related unrecognized deferred income tax liability. Upon repatriation of those earnings, in the form of dividends or otherwise, the Company would be subject to U.S. federal income taxes (subject to an adjustment for foreign tax credits) and withholding taxes payable to the various foreign countries. |
Restructuring_Expense
Restructuring Expense | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Restructuring and Related Activities [Abstract] | ' | |||||||||||||||
Restructuring Expense | ' | |||||||||||||||
Restructuring Expenses | ||||||||||||||||
2003 Restructuring | ||||||||||||||||
In June 2003, Vertex adopted a plan to restructure its operations to coincide with its increasing internal emphasis on advancing drug candidates through clinical development to commercialization. The restructuring was designed to re-balance the Company’s relative investments in research and development to better support the Company’s long-term strategy. At that time, the restructuring plan included a workforce reduction, write-offs of certain assets and a decision not to occupy approximately 290,000 square feet of specialized laboratory and office space in Cambridge, Massachusetts under lease to Vertex (the “Kendall Square Lease”). The Kendall Square Lease commenced in January 2003 and has a 15-year term. In the second quarter of 2005, the Company revised its assessment of its real estate requirements and decided to use approximately 120,000 square feet of the facility subject to the Kendall Square Lease (the “Kendall Square Facility”) for its operations, beginning in 2006. The remaining rentable square footage of the Kendall Square Facility currently is subleased to third parties. | ||||||||||||||||
The Company’s initial estimate of its liability for net ongoing costs associated with the Kendall Square Lease obligation was recorded in the second quarter of 2003 at fair value. The restructuring expense incurred from the second quarter of 2003 through the end of the first quarter of 2005 (i.e., immediately prior to the Company’s decision to use a portion of the Kendall Square Facility for its operations) relates to the estimated incremental net ongoing lease obligations associated with the entire Kendall Square Facility, together with imputed interest costs relating to the restructuring liability. The restructuring expense incurred in the period beginning in the second quarter of 2005 relates only to the portion of the Kendall Square Facility that the Company was not occupying and did not intend to occupy for its operations. The remaining lease obligations, which are associated with the portion of the Kendall Square Facility that the Company occupies and uses for its operations, are recorded as rental expense in the period incurred. In 2014, the Company expects to cease using this portion of the Kendall Square Facility for its operations, and to incur related cease use charges. The Company reviews its assumptions and estimates quarterly and updates its estimates of this liability as changes in circumstances require. The expense and liability recorded is calculated using probability-weighted discounted cash-flows of the Company’s estimated ongoing lease obligations, including contractual rental and build-out commitments, net of estimated sublease rentals, offset by related sublease costs. | ||||||||||||||||
In estimating the expense and liability under its Kendall Square Lease obligation, the Company estimated (i) the costs to be incurred to satisfy rental and build-out commitments under the lease (including operating costs), (ii) the lead-time necessary to sublease the space, (iii) the projected sublease rental rates, and (iv) the anticipated durations of subleases. The Company uses a credit-adjusted risk-free rate of approximately 10% to discount the estimated cash flows. The Company reviews its estimates and assumptions on at least a quarterly basis, intends to continue such reviews until the termination of the Kendall Square Lease, and will make whatever modifications the Company believes necessary, based on the Company’s best judgment, to reflect any changed circumstances. The Company’s estimates have changed in the past, and may change in the future, resulting in additional adjustments to the estimate of the liability. Changes to the Company’s estimate of the liability are recorded as additional restructuring expenses (credits). In addition, because the Company’s estimate of the liability includes the application of a discount rate to reflect the time-value of money, the Company records imputed interest costs related to the liability each quarter. These costs are included in restructuring expenses on the Company’s consolidated statements of operations. | ||||||||||||||||
The activity related to restructuring and other liability for 2003 was as follows: | ||||||||||||||||
Restructuring Expense | Cash | Non-cash | Liability as of | |||||||||||||
Payments | Expense | December 31, | ||||||||||||||
2003 | ||||||||||||||||
(in thousands) | ||||||||||||||||
Lease restructuring and other operating lease expense | $ | 84,726 | $ | (15,200 | ) | $ | — | $ | 69,526 | |||||||
Employee severance, benefits and related costs | 2,616 | (2,616 | ) | — | — | |||||||||||
Leasehold improvements and asset impairments | 4,482 | — | (4,482 | ) | — | |||||||||||
Total | $ | 91,824 | $ | (17,816 | ) | $ | (4,482 | ) | $ | 69,526 | ||||||
In 2003, the lease restructuring and other operating lease expense included $78.7 million of lease restructuring expense and $6.0 million of lease operating expense incurred prior to the decision not to occupy the Kendall Square Facility. The restructuring accrual as of December 31, 2003 related only to the lease restructuring expense. | ||||||||||||||||
The activity related to 2003 restructuring for 2004 through 2013 was as follows: | ||||||||||||||||
2013 | 2012 | 2011 | 2004-2013 | |||||||||||||
(in thousands) | ||||||||||||||||
Liability, beginning of the period | $ | 23,328 | $ | 26,313 | $ | 29,595 | $ | 69,526 | ||||||||
Cash payments | (15,255 | ) | (14,853 | ) | (14,904 | ) | (178,952 | ) | ||||||||
Cash received from subleases | 10,670 | 10,024 | 9,548 | 75,708 | ||||||||||||
Credit for portion of facility Vertex decided to occupy in 2005 | — | — | — | (10,018 | ) | |||||||||||
Restructuring expense | 372 | 1,844 | 2,074 | 62,851 | ||||||||||||
Liability, end of the period | $ | 19,115 | $ | 23,328 | $ | 26,313 | $ | 19,115 | ||||||||
In each period, the Company records lease restructuring expense attributable to imputed interest related to the restructuring liability. In certain periods, the restructuring expense also reflects the revision of certain key estimates and assumptions about building operating expenses and sublease income. | ||||||||||||||||
Fan Pier Move Restructuring | ||||||||||||||||
In connection with the relocation of its Massachusetts operations to Fan Pier in Boston, Massachusetts, the Company expects to incur restructuring charges related to its remaining lease obligations at its facilities in Cambridge, Massachusetts, including lease obligations related to the 120,000 square feet of the facility subject to the Kendall Square lease that the Company began using for its operations in 2006. The Company started incurring these charges in the fourth quarter of 2013 and expects them to continue through April 2018. Most of these restructuring charges will relate to cease use charges that will be incurred during the first half of 2014. The Company incurred $1.2 million of charges related to this restructuring during 2013. The continuing charges will relate to the difference between the Company’s estimated future cash flows related to its lease obligations and the actual cash flows that it incurs. | ||||||||||||||||
2013 Strategic Restructuring | ||||||||||||||||
In October 2013, the Company adopted a restructuring plan. The restructuring plan included (i) a workforce reduction primarily related to the commercial support of INCIVEK following the continued and rapid decline in the number of patients being treated with INCIVEK as new medicines for the treatment of HCV infection neared approval and (ii) the write-off of certain assets. This action resulted from the Company's decision to focus its investment on future opportunities in cystic fibrosis and other research and development programs. | ||||||||||||||||
The restructuring charges recorded during 2013 for each major type of cost associated with this restructuring plan were as follows: | ||||||||||||||||
Restructuring Expense | Cash | Non-cash Expense | Liability as of | |||||||||||||
Payments | December 31, | |||||||||||||||
2013 | ||||||||||||||||
(in thousands) | ||||||||||||||||
Employee severance, benefits and related costs | $ | 25,060 | $ | (21,458 | ) | $ | (1,312 | ) | $ | 2,290 | ||||||
Asset impairments | 6,282 | — | (6,282 | ) | — | |||||||||||
Contract termination and other associated costs | 7,609 | (1,458 | ) | — | 6,151 | |||||||||||
Total | $ | 38,951 | $ | (22,916 | ) | $ | (7,594 | ) | $ | 8,441 | ||||||
The Company estimates that it will incur aggregate restructuring charges of approximately $2.0 million to $2.5 million in 2014 and 2015 related to this restructuring plan. The Company anticipates cash payments of $7.9 million and $0.5 million will be made in 2014 and 2015, respectively, related to the restructuring liability as of December 31, 2013. |
Employee_Benefits
Employee Benefits | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Compensation and Retirement Disclosure [Abstract] | ' | |||||||||||
Employee Benefits | ' | |||||||||||
Employee Benefits | ||||||||||||
The Company has a 401(k) retirement plan (the “Vertex 401(k) Plan”) in which substantially all of its permanent U.S. employees are eligible to participate. Participants may contribute up to 60% of their annual compensation to the Vertex 401(k) Plan, subject to statutory limitations. The Company may declare discretionary matching contributions to the Vertex 401(k) Plan. Employees have the ability to transfer funds from the stock fund invested in Vertex common stock, subject to certain restrictions. As of December 31, 2013, 755,000 shares of common stock remained available for grant under the Vertex 401(k) Plan. Through mid-2013, the Company paid matching contributions in Vertex common stock in the form of fully-vested interests in a Vertex common stock fund. Beginning in mid-2013, the Company began paying matching contributions in the form of cash. | ||||||||||||
The Company declared matching contributions paid in fully-vested interests in the Vertex common stock fund to the Vertex 401(k) Plan as follows: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(in thousands) | ||||||||||||
Discretionary matching contributions during the year ended December 31, | $ | 5,930 | $ | 10,261 | $ | 8,619 | ||||||
Shares issued during the year ended December 31, | 99 | 242 | 183 | |||||||||
Shares issuable as of the year ended December 31, | 0 | 53 | 62 | |||||||||
In 2013, the Company declared matching contributions paid in fully-vested interests in the Vertex common stock fund of $5.9 million, paid matching contributions in the form of cash of $5.0 million and accrued $2.4 million related to matching contributions for the fourth quarter of 2013, which will be paid in the first quarter of 2014. |
Commitments
Commitments | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
Commitments | ' | ||||||||||||||||||||
Commitments | ' | ||||||||||||||||||||
Commitments | |||||||||||||||||||||
The Company moved into its new corporate headquarters in January 2014. Please refer to Note I, "Fan Pier Leases," for additional information regarding this commitment. The leases for the Company’s former headquarters expire in December 2015. | |||||||||||||||||||||
The term of the Kendall Square Lease began in January 2003. The Company occupies and uses for its operations approximately 120,000 square feet of the Kendall Square Facility and plans to cease using for its operations this portion of the Kendall Square Facility in 2014. The Company has sublease arrangements in place for the remaining rentable square footage of the Kendall Square Facility, with terms that expire in April 2015 and August 2015. The Kendall Square Lease will expire in 2018. Please refer to Note R, "Restructuring Expenses," for further information. | |||||||||||||||||||||
As of December 31, 2013, future minimum commitments under the Fan Pier Leases, facility operating leases with terms of more than one year and contractual sublease income under the Company’s subleases for the Kendall Square Facility were as follows: | |||||||||||||||||||||
Year | Fan Pier | Kendall Square | Kendall Sublease | Other | Total Lease | ||||||||||||||||
Leases | Lease | Income | Operating | Commitments | |||||||||||||||||
Leases | (Net of Sublease Income) | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||
2014 | $ | 67,206 | $ | 19,879 | $ | (8,546 | ) | $ | 40,762 | $ | 119,301 | ||||||||||
2015 | 67,206 | 19,879 | (3,996 | ) | 33,398 | 116,487 | |||||||||||||||
2016 | 67,206 | 19,879 | — | 14,434 | 101,519 | ||||||||||||||||
2017 | 67,206 | 19,879 | — | 12,995 | 100,080 | ||||||||||||||||
2018 | 67,206 | 6,626 | — | 12,841 | 86,673 | ||||||||||||||||
Thereafter | 752,798 | — | — | 75,344 | 828,142 | ||||||||||||||||
Total minimum lease payments | $ | 1,088,828 | $ | 86,142 | $ | (12,542 | ) | $ | 189,774 | $ | 1,352,202 | ||||||||||
During 2013, 2012 and 2011, rental expense was $57.7 million, $57.1 million and $49.4 million, respectively. | |||||||||||||||||||||
The Company has outstanding capital leases for equipment, leasehold improvements and software licenses with terms through 2019. The leases were accounted for as capital leases. The capital leases bear interest at rates ranging from 2% to 7% per year. The following table sets forth the Company’s future minimum payments due under capital leases as of December 31, 2013: | |||||||||||||||||||||
Year | (in thousands) | ||||||||||||||||||||
2014 | $ | 19,957 | |||||||||||||||||||
2015 | 18,346 | ||||||||||||||||||||
2016 | 11,809 | ||||||||||||||||||||
2017 | 10,714 | ||||||||||||||||||||
2018 | 10,612 | ||||||||||||||||||||
Thereafter | 2,121 | ||||||||||||||||||||
Total payments | 73,559 | ||||||||||||||||||||
Less: amount representing interest | (7,912 | ) | |||||||||||||||||||
Present value of payments | $ | 65,647 | |||||||||||||||||||
In addition, the Company has committed to make potential future milestone and royalty payments pursuant to certain collaboration agreements. Payments generally become due and payable upon the achievement of certain developmental, regulatory and/or commercial milestones. Please refer to Note B, "Collaborative Arrangements," for further information. | |||||||||||||||||||||
In the second quarter of 2013, the Company began supporting $31.9 million in irrevocable stand-by letters of credit issued in support of property leases and other similar agreements with an unsecured credit facility with a one-year term. The Company previously had cash-collateralized these stand-by letters of credit. As a result of this credit facility, the restricted cash reflected on the Company's consolidated balance sheets decreased by $31.8 million net of other activity during 2013, and the Company's cash and cash equivalents increased by a corresponding amount during 2013. |
Legal_Proceedings
Legal Proceedings | 12 Months Ended |
Dec. 31, 2013 | |
Legal Proceedings [Abstract] | ' |
Legal Proceedings | ' |
Legal Proceedings | |
On September 6, 2012, a purported shareholder class action, City of Bristol Pension Fund v. Vertex Pharmaceuticals Incorporated, et al., was filed in the United States District Court for the District of Massachusetts, naming the Company and certain of the Company's current and former officers and directors as defendants. The lawsuit alleges that the Company made material misrepresentations and/or omissions of material fact in the Company's disclosures during the period from May 7, 2012 through June 28, 2012, all in violation of Section 10(b) of the Securities Exchange Act of 1934, as amended, and Rule 10b-5 promulgated thereunder. By order dated December 12, 2012, the court appointed the City of Bristol lead plaintiff and appointed the City of Bristol's attorneys lead counsel. The plaintiffs filed an amended complaint on February 11, 2013. The Company filed a motion to dismiss the complaint on April 12, 2013. On May 28, 2013, the plaintiffs filed an opposition to the Company's motion to dismiss the complaint. On June 27, 2013, the Company filed a reply in further support of the Company's motion to dismiss the plaintiffs' complaint. The court conducted a hearing on the Company's motion to dismiss on November 25, 2013. The plaintiffs seek unspecified monetary damages on behalf of the putative class and an award of costs and expenses, including attorney's fees, as well as disgorgement of the proceeds from certain individual defendants' sales of the Company's common stock. The Company believes that this action is without merit and intends to defend it vigorously. As of December 31, 2013, the Company has not recorded any reserves for this purported class action. |
Contingencies
Contingencies | 12 Months Ended |
Dec. 31, 2013 | |
Commitments and Contingencies Disclosure [Abstract] | ' |
Contingencies | ' |
Contingencies | |
The Company has certain contingent liabilities that arise in the ordinary course of its business activities. The Company accrues a reserve for contingent liabilities when it is probable that future expenditures will be made and such expenditures can be reasonably estimated. There were no material contingent liabilities accrued as of December 31, 2013 or 2012. |
Guarantees
Guarantees | 12 Months Ended |
Dec. 31, 2013 | |
Guarantees [Abstract] | ' |
Guarantees | ' |
Guarantees | |
As permitted under Massachusetts law, the Company’s Articles of Organization and By-laws provide that the Company will indemnify certain of its officers and directors for certain claims asserted against them in connection with their service as an officer or director. The maximum potential amount of future payments that the Company could be required to make under these indemnification provisions is unlimited. However, the Company has purchased directors’ and officers’ liability insurance policies that could reduce its monetary exposure and enable it to recover a portion of any future amounts paid. No indemnification claims currently are outstanding, and the Company believes the estimated fair value of these indemnification arrangements is minimal. | |
The Company customarily agrees in the ordinary course of its business to indemnification provisions in agreements with clinical trial investigators and sites in its drug development programs, sponsored research agreements with academic and not-for-profit institutions, various comparable agreements involving parties performing services for the Company, and its real estate leases. The Company also customarily agrees to certain indemnification provisions in its drug discovery, development and commercialization collaboration agreements. With respect to the Company’s clinical trials and sponsored research agreements, these indemnification provisions typically apply to any claim asserted against the investigator or the investigator’s institution relating to personal injury or property damage, violations of law or certain breaches of the Company’s contractual obligations arising out of the research or clinical testing of the Company’s compounds or drug candidates. With respect to lease agreements, the indemnification provisions typically apply to claims asserted against the landlord relating to personal injury or property damage caused by the Company, to violations of law by the Company or to certain breaches of the Company’s contractual obligations. The indemnification provisions appearing in the Company’s collaboration agreements are similar to those for the other agreements discussed above, but in addition provide some limited indemnification for its collaborator in the event of third-party claims alleging infringement of intellectual property rights. In each of the cases above, the indemnification obligation generally survives the termination of the agreement for some extended period, although the Company believes the obligation typically has the most relevance during the contract term and for a short period of time thereafter. The maximum potential amount of future payments that the Company could be required to make under these provisions is generally unlimited. The Company has purchased insurance policies covering personal injury, property damage and general liability that reduce its exposure for indemnification and would enable it in many cases to recover all or a portion of any future amounts paid. The Company has never paid any material amounts to defend lawsuits or settle claims related to these indemnification provisions. Accordingly, the Company believes the estimated fair value of these indemnification arrangements is minimal. |
Segment_Information
Segment Information | 12 Months Ended | ||||||||||||||
Dec. 31, 2013 | |||||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||||
Segment Information | ' | ||||||||||||||
Segment Information | |||||||||||||||
The Company operates in one segment, pharmaceuticals. Enterprise-wide disclosures about revenues, significant customers, and property and equipment, net by location are presented below. | |||||||||||||||
Revenues by Product | |||||||||||||||
Product revenues, net consisted of the following: | |||||||||||||||
2013 | 2012 | 2011 | |||||||||||||
(in thousands) | |||||||||||||||
INCIVEK | $ | 466,360 | $ | 1,161,813 | $ | 950,889 | |||||||||
KALYDECO | 371,285 | 171,645 | — | ||||||||||||
Total product revenues, net | $ | 837,645 | $ | 1,333,458 | $ | 950,889 | |||||||||
Revenues by Geographic Location | |||||||||||||||
Total revenues from external customers and collaborators by geographic region consisted of the following. Product revenues are attributed to countries based on the location of the customer. Collaborative revenues are attributed to the operations of the Company in the United States. Royalty revenues are attributed to countries based on the location of the collaborator. | |||||||||||||||
2013 | 2012 | 2011 | |||||||||||||
(in thousands) | |||||||||||||||
United States | $ | 896,952 | $ | 1,373,516 | $ | 1,389,568 | |||||||||
Outside of the United States | |||||||||||||||
Europe | 279,557 | 129,786 | 20,289 | ||||||||||||
Other | 35,466 | 23,740 | 769 | ||||||||||||
Total revenues outside of the United States | 315,023 | 153,526 | 21,058 | ||||||||||||
Total revenues | $ | 1,211,975 | $ | 1,527,042 | $ | 1,410,626 | |||||||||
Significant Customers | |||||||||||||||
Gross revenues and accounts receivable from each of the Company’s customers who individually accounted for 10% or more of total gross revenues and/or 10% or more of total gross accounts receivable consisted of the following: | |||||||||||||||
Percent of Total Gross Revenues | Percent of Gross Accounts Receivable | ||||||||||||||
Year Ended December 31, | As of December 31, | ||||||||||||||
2013 | 2012 | 2011 | 2013 | 2012 | |||||||||||
Janssen | 22 | % | <10 | % | 19 | % | 28 | % | 26 | % | |||||
AmerisourceBergen Drug Corporation | 21 | % | 32 | % | 25 | % | <10 | % | 22 | % | |||||
McKesson Corporation | 21 | % | 29 | % | 24 | % | <10 | % | 26 | % | |||||
Cardinal Health Incorporated | <10 | % | 15 | % | 15 | % | <10 | % | <10 | % | |||||
Bupa Home Healthcare Limited | <10 | % | N/A | N/A | 14 | % | N/A | ||||||||
Property and Equipment, Net by Location | |||||||||||||||
Property and equipment, net by location consisted of the following: | |||||||||||||||
As of December 31, | |||||||||||||||
2013 | 2012 | ||||||||||||||
(in thousands) | |||||||||||||||
United States | $ | 657,587 | $ | 400,102 | |||||||||||
Outside of the United States | |||||||||||||||
United Kingdom | 29,970 | 30,622 | |||||||||||||
Other | 9,354 | 2,885 | |||||||||||||
Total property and equipment, net outside of the United States | 39,324 | 33,507 | |||||||||||||
Total property and equipment, net | $ | 696,911 | $ | 433,609 | |||||||||||
Quarterly_Financial_Data_unaud
Quarterly Financial Data (unaudited) | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | |||||||||||||||
Quarterly Financial Data (unaudited) | ' | |||||||||||||||
Quarterly Financial Data (unaudited) | ||||||||||||||||
Three Months Ended | ||||||||||||||||
March 31, | June 30, | September 30, | December 31, | |||||||||||||
2013 | 2013 | 2013 | 2013 | |||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||
Revenues: | ||||||||||||||||
Product revenues, net | $ | 267,381 | $ | 254,789 | $ | 186,653 | $ | 128,822 | ||||||||
Royalty revenues | 43,573 | 49,120 | 27,012 | 36,887 | ||||||||||||
Collaborative revenues (1) | 17,414 | 6,841 | 8,035 | 185,448 | ||||||||||||
Total revenues | 328,368 | 310,750 | 221,700 | 351,157 | ||||||||||||
Costs and expenses: | ||||||||||||||||
Cost of product revenues (2) | 30,955 | 24,695 | 20,048 | 13,281 | ||||||||||||
Royalty expenses | 11,788 | 13,236 | 7,291 | 8,983 | ||||||||||||
Research and development expenses | 218,095 | 222,455 | 228,624 | 249,609 | ||||||||||||
Sales, general and administrative expenses | 92,879 | 106,521 | 87,754 | 75,188 | ||||||||||||
Restructuring expenses | 39 | 776 | 12,048 | 27,658 | ||||||||||||
Intangible asset impairment charges (3)(4) | 412,900 | — | — | 250,600 | ||||||||||||
Total costs and expenses | 766,656 | 367,683 | 355,765 | 625,319 | ||||||||||||
Loss from operations | (438,288 | ) | (56,933 | ) | (134,065 | ) | (274,162 | ) | ||||||||
Interest expense, net | (3,465 | ) | (6,551 | ) | (95 | ) | (12,619 | ) | ||||||||
Other income (expense), net (4) | (1,187 | ) | (27 | ) | 4,747 | (53,472 | ) | |||||||||
Loss before benefit from income taxes | (442,940 | ) | (63,511 | ) | (129,413 | ) | (340,253 | ) | ||||||||
Benefit from income taxes (3)(4) | (130,313 | ) | (1,799 | ) | (751 | ) | (155,704 | ) | ||||||||
Net loss | (312,627 | ) | (61,712 | ) | (128,662 | ) | (184,549 | ) | ||||||||
Net loss attributable to noncontrolling interest (Alios) | 4,611 | 4,547 | 4,530 | 228,834 | ||||||||||||
Net income (loss) attributable to Vertex | $ | (308,016 | ) | $ | (57,165 | ) | $ | (124,132 | ) | $ | 44,285 | |||||
Net income (loss) per share attributable to Vertex common shareholders: | ||||||||||||||||
Basic | $ | (1.43 | ) | $ | (0.26 | ) | $ | (0.54 | ) | $ | 0.19 | |||||
Diluted | $ | (1.43 | ) | $ | (0.26 | ) | $ | (0.54 | ) | $ | 0.19 | |||||
Shares used in per share calculations: | ||||||||||||||||
Basic | 215,421 | 222,053 | 230,505 | 231,264 | ||||||||||||
Diluted | 215,421 | 222,053 | 230,505 | 235,717 | ||||||||||||
Three Months Ended | ||||||||||||||||
March 31, | June 30, | September 30, | December 31, | |||||||||||||
2012 | 2012 | 2012 | 2012 | |||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||
Revenues: | ||||||||||||||||
Product revenues, net | $ | 375,375 | $ | 373,273 | $ | 303,501 | $ | 281,309 | ||||||||
Royalty revenues | 38,981 | 33,480 | 25,586 | 43,451 | ||||||||||||
Collaborative revenues | 24,381 | 11,552 | 6,919 | 9,234 | ||||||||||||
Total revenues | 438,737 | 418,305 | 336,006 | 333,994 | ||||||||||||
Costs and expenses: | ||||||||||||||||
Cost of product revenues (2) | 25,918 | 104,549 | 30,680 | 75,595 | ||||||||||||
Royalty expenses | 13,293 | 9,874 | 7,856 | 12,120 | ||||||||||||
Research and development expenses | 196,371 | 196,544 | 200,161 | 213,109 | ||||||||||||
Sales, general and administrative expenses | 111,146 | 117,514 | 97,684 | 110,452 | ||||||||||||
Restructuring expenses | 360 | 594 | 696 | 194 | ||||||||||||
Intangible asset impairment charge | — | — | — | — | ||||||||||||
Total costs and expenses | 347,088 | 429,075 | 337,077 | 411,470 | ||||||||||||
Income (loss) from operations | 91,649 | (10,770 | ) | (1,071 | ) | (77,476 | ) | |||||||||
Interest expense, net | (3,891 | ) | (3,814 | ) | (4,054 | ) | (3,263 | ) | ||||||||
Other income (expense), net | 150 | 179 | 13 | (33 | ) | |||||||||||
Income (loss) before provision for (benefit from) income taxes | 87,908 | (14,405 | ) | (5,112 | ) | (80,772 | ) | |||||||||
Provision for (benefit from) income taxes | 32 | 20,063 | 21,355 | (2,696 | ) | |||||||||||
Net income (loss) | 87,876 | (34,468 | ) | (26,467 | ) | (78,076 | ) | |||||||||
Net loss (income) attributable to noncontrolling interest (Alios) | 3,714 | (30,463 | ) | (31,076 | ) | 1,928 | ||||||||||
Net income (loss) attributable to Vertex | $ | 91,590 | $ | (64,931 | ) | $ | (57,543 | ) | $ | (76,148 | ) | |||||
Net income (loss) per share attributable to Vertex common shareholders: | ||||||||||||||||
Basic | $ | 0.44 | $ | (0.31 | ) | $ | (0.27 | ) | $ | (0.35 | ) | |||||
Diluted | $ | 0.43 | $ | (0.31 | ) | $ | (0.27 | ) | $ | (0.35 | ) | |||||
Shares used in per share calculations: | ||||||||||||||||
Basic | 208,018 | 211,344 | 213,767 | 214,607 | ||||||||||||
Diluted | 219,264 | 211,344 | 213,767 | 214,607 | ||||||||||||
1 | During the fourth quarter of 2013, the Company recorded $182.4 million of collaborative revenue related to its Janssen collaboration, which was primarily attributable to an amendment to its collaboration agreement with Janssen. See Note B, "Collaborative Arrangements," for further information. | |||||||||||||||
2 | During 2013 and 2012, the Company recorded within cost of product revenues lower-of-cost or market charges for excess or obsolete inventories. See Note G, "Inventories," for further information. | |||||||||||||||
3 | During the first quarter of 2013, the Company recorded a $412.9 million intangible asset impairment charge related to its VX-222 indefinite-lived in-process research and development asset. In connection with this impairment charge, the Company recorded a credit of $127.6 million in its provision for income taxes. See Note J, "Intangible Assets and Goodwill," for further information. | |||||||||||||||
4 | During the fourth quarter of 2013, the Company deconsolidated Alios, which included certain charges related to deconsolidation recorded in other income (expense), net, and was preceded by a $250.6 million intangible asset impairment charge related to the HCV nucleotide analogue program indefinite-lived in-process research and development asset. In connection with this impairment charge, a credit of $102.1 million was recorded to the provision for income taxes attributable to Alios. See Note B, "Collaborative Arrangements," and Note J, "Intangible Assets and Goodwill," for further information. |
Nature_of_Business_and_Account1
Nature of Business and Accounting Policies (Policies) | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
Accounting Policies [Abstract] | ' | |||||||||||||||||||
Basis of Presentation | ' | |||||||||||||||||||
Basis of Presentation | ||||||||||||||||||||
The consolidated financial statements reflect the operations of (i) the Company and (ii) its wholly-owned subsidiaries. In addition, the consolidated financial statements for the period from June 13, 2011 through December 31, 2013, reflect the operations of Alios BioPharma, Inc. (“Alios”), a collaborator that is a variable interest entity (a “VIE”) for which the Company was deemed under applicable accounting guidance to have a variable interest and be the primary beneficiary. As of December 31, 2013, the Company deconsolidated Alios, and the Company's consolidated balance sheet as of December 31, 2013 excludes Alios. All material intercompany balances and transactions have been eliminated. The Company operates in one segment, pharmaceuticals. Please refer to Note X, "Segment Information," for enterprise-wide disclosures regarding the Company’s revenues, major customers and long-lived assets by geographic area. | ||||||||||||||||||||
Use of Estimates | ' | |||||||||||||||||||
Use of Estimates | ||||||||||||||||||||
The preparation of consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the amounts of revenues and expenses during the reported periods. Significant estimates in these consolidated financial statements have been made in connection with the calculation of revenues, inventories, research and development expenses, stock-based compensation expense, restructuring expense, the fair value of intangible assets, noncontrolling interest (Alios), the consolidation and deconsolidation of a VIE, leases and the income tax provision. The Company bases its estimates on historical experience and various other assumptions, including in certain circumstances future projections, that management believes to be reasonable under the circumstances. Actual results could differ from those estimates. Changes in estimates are reflected in reported results in the period in which they become known. | ||||||||||||||||||||
Revenue Recognition | ' | |||||||||||||||||||
Revenue Recognition | ||||||||||||||||||||
Product Revenues, Net | ||||||||||||||||||||
The Company sells its products principally to a limited number of major and selected regional wholesalers and specialty pharmacy providers in North America as well as government-owned and supported customers in Europe (collectively, its “Customers”). The Company's Customers in North America subsequently resell the products to patients and health care providers. The Company recognizes net revenues from product sales upon delivery as long as (i) there is persuasive evidence that an arrangement exists between the Company and the Customer, (ii) collectibility is reasonably assured and (iii) the price is fixed or determinable. | ||||||||||||||||||||
In order to conclude that the price is fixed or determinable, the Company must be able to (i) calculate its gross product revenues from sales to Customers and (ii) reasonably estimate its net product revenues upon delivery to its Customer's locations. The Company calculates gross product revenues based on the price that the Company charges its Customers. The Company estimates its net product revenues by deducting from its gross product revenues (a) trade allowances, such as invoice discounts for prompt payment and Customer fees, (b) estimated government and private payor rebates, chargebacks and discounts, (c) estimated reserves for expected product returns and (d) estimated costs of incentives offered to certain indirect customers, including patients. | ||||||||||||||||||||
The Company makes significant estimates and judgments that materially affect the Company’s recognition of net product revenues. In certain instances, the Company may be unable to reasonably conclude that the price is fixed or determinable at the time of delivery, in which case it defers the recognition of revenues. Once the Company is able to determine that the price is fixed or determinable, it recognizes the revenues associated with the units in which revenue recognition was deferred. | ||||||||||||||||||||
Trade Allowances: The Company generally provides invoice discounts on product sales to its Customers for prompt payment and pays fees for distribution services, such as fees for certain data that Customers provide to the Company. The payment terms for sales to Customers in the United States generally include a 2% discount for payment within 30 days. The Company expects that, based on its experience, its Customers will earn these discounts and fees, and deducts the full amount of these discounts and fees from its gross product revenues and accounts receivable at the time such revenues are recognized. | ||||||||||||||||||||
Rebates, Chargebacks and Discounts: The Company contracts with government agencies and various private organizations (collectively, its “Third-party Payors”) so that products will be eligible for purchase by, or partial or full reimbursement from, such Third-party Payors. The Company estimates the rebates, chargebacks and discounts it will provide to Third-party Payors and deducts these estimated amounts from its gross product revenues at the time the revenues are recognized. For each product, the Company estimates the aggregate rebates, chargebacks and discounts that it will provide to Third-party Payors based upon (i) the Company’s contracts with these Third-party Payors, (ii) the government-mandated discounts applicable to government-funded programs, (iii) information obtained from the Company’s Customers regarding the payor mix for such product and (iv) historical experience. | ||||||||||||||||||||
Product Returns: The Company estimates the amount of each product that will be returned and deducts these estimated amounts from its gross revenues at the time the revenues are recognized. The Company’s Customers have the right to return unopened unprescribed packages, subject to contractual limitations. To date product returns have been minimal and, based on inventory levels held by its Customers and its distribution model, the Company believes that returns of its products will continue to be minimal. | ||||||||||||||||||||
Other Incentives: Other incentives that the Company offers include co-pay mitigation rebates provided by the Company to commercially insured patients who have coverage and who reside in states that permit co-pay mitigation programs. The Company’s co-pay mitigation programs are intended to reduce each participating patient’s portion of the financial responsibility for a product’s purchase price to a specified dollar amount. Based upon the terms of the Company's co-pay mitigation programs, the Company estimates average co-pay mitigation amounts for each of its products in order to establish its accruals for co-pay mitigation rebates and deducts these estimated amounts from its gross product revenues at the later of the date (i) the revenues are recognized or (ii) the incentive is offered. The Company’s co-pay mitigation rebates are subject to expiration. | ||||||||||||||||||||
The following table summarizes activity in each of the product revenue allowance and reserve categories for the three years ended December 31, 2013: | ||||||||||||||||||||
Trade | Rebates, | Product | Other | Total | ||||||||||||||||
Allowances | Chargebacks | Returns | Incentives | |||||||||||||||||
and Discounts | ||||||||||||||||||||
(in thousands) | ||||||||||||||||||||
2013 | ||||||||||||||||||||
Beginning Balance | $ | 5,416 | $ | 63,560 | $ | 2,852 | $ | 3,565 | $ | 75,393 | ||||||||||
Provision related to current period sales | 31,395 | 204,459 | 5,795 | 9,295 | 250,944 | |||||||||||||||
Adjustments related to prior period sales | 343 | 4,474 | 15,149 | (228 | ) | 19,738 | ||||||||||||||
Credits/payments made | (35,619 | ) | (204,249 | ) | (7,997 | ) | (11,077 | ) | (258,942 | ) | ||||||||||
Ending Balance | $ | 1,535 | $ | 68,244 | $ | 15,799 | $ | 1,555 | $ | 87,133 | ||||||||||
2012 | ||||||||||||||||||||
Beginning Balance | $ | 11,162 | $ | 52,659 | $ | 340 | $ | 5,202 | $ | 69,363 | ||||||||||
Provision related to current period sales | 55,913 | 216,942 | 2,067 | 19,103 | 294,025 | |||||||||||||||
Adjustments related to prior period sales | 29 | 3,883 | 1,498 | 72 | 5,482 | |||||||||||||||
Credits/payments made | (61,688 | ) | (209,924 | ) | (1,053 | ) | (20,812 | ) | (293,477 | ) | ||||||||||
Ending Balance | $ | 5,416 | $ | 63,560 | $ | 2,852 | $ | 3,565 | $ | 75,393 | ||||||||||
2011 | ||||||||||||||||||||
Beginning Balance | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||
Provision related to current period sales | 38,228 | 75,145 | 553 | 9,692 | 123,618 | |||||||||||||||
Credits/payments made | (27,066 | ) | (22,486 | ) | (213 | ) | (4,490 | ) | (54,255 | ) | ||||||||||
Ending Balance | $ | 11,162 | $ | 52,659 | $ | 340 | $ | 5,202 | $ | 69,363 | ||||||||||
Based on the current information available to the Company, cumulative adjustments related to prior period sales represent 0.7% and 1.3%, respectively, of the gross product revenues that were recorded in the years ended December 31, 2012 and 2011. | ||||||||||||||||||||
Royalty Revenues | ||||||||||||||||||||
The Company’s royalty revenues on commercial sales of INCIVO (telaprevir) by Janssen are based on net sales of licensed products in licensed territories as provided by Janssen. The Company recognizes royalty revenues in the period the sales occur. | ||||||||||||||||||||
The Company has sold its rights to receive certain royalties on sales of an HIV protease inhibitor (fosamprenavir) and recognizes the revenues related to this sale as royalty revenues. In the circumstance where the Company has sold its rights to future royalties under a license agreement and also maintains continuing involvement in the royalty arrangement (but not significant continuing involvement in the generation of the cash flows payable to the purchaser of the future royalty rights), the Company defers recognition of the proceeds it receives for the royalty stream and recognizes these deferred revenues over the life of the license agreement pursuant to the units-of-revenue method. The Company’s estimates regarding the estimated remaining royalty payments due to the purchaser have changed in the past and may change in the future. | ||||||||||||||||||||
Collaborative Revenues | ||||||||||||||||||||
The Company recognizes revenues generated through collaborative research, development and/or commercialization agreements. The terms of these agreements typically include payment to the Company of one or more of the following: nonrefundable, up-front license fees; development and commercial milestone payments; funding of research and/or development activities; payments for services the Company provides through its third-party manufacturing network; and royalties on net sales of licensed products. Each of these types of payments results in collaborative revenues, except for revenues from royalties on net sales of licensed products, which are classified as royalty revenues. | ||||||||||||||||||||
For each collaborative research, development and/or commercialization agreement that result in revenues, the Company determines (i) whether multiple deliverables exist, (ii) whether the undelivered elements have value to the customer on a stand-alone basis, (iii) how the deliverables should be separated and (iv) how the consideration should be allocated to the deliverables. For arrangements entered into or materially modified after January 1, 2011, the Company allocates consideration in an arrangement using the relative selling price method based on management’s best estimate of selling price of deliverables if it does not have vendor-specific objective evidence or third-party evidence. As part of the accounting for these agreements, the Company must develop assumptions that require judgment to determine the best estimate of selling price. Key assumptions utilized by the Company to determine the best estimate of selling price may include patient enrollment requirements from regulatory authorities, development timelines, reimbursement rates for personnel costs, discount rates, and estimated third-party development costs. | ||||||||||||||||||||
The Company evaluates amendments to its existing arrangements to determine whether they have been materially modified. In making its determination that an arrangement has been materially modified, the Company considers whether there have been significant changes to the consideration under the arrangement, the deliverables under the arrangement, the timing of deliverables and the period of the arrangement. If the arrangement is determined to have been materially modified, the Company allocates fixed consideration under the arrangement using its best estimate of selling price to the remaining undelivered elements at the date of material modification. Any consideration remaining after the allocation is recognized as revenue. | ||||||||||||||||||||
Collaborative research, development and/or commercialization agreements entered into prior to January 1, 2011 that contained multiple elements of revenue were divided into separate units of accounting if certain criteria were met, including whether the delivered element had stand-alone value to the collaborator and whether there was objective and reliable evidence of the fair value of the undelivered obligation(s). The Company allocated consideration it received among the separate units either on the basis of each unit’s fair value or using the residual method, and applied the revenue recognition criteria to each of the separate units. | ||||||||||||||||||||
Up-front License Fees: If the license to the Company's intellectual property was determined to have stand-alone value from the other deliverables identified in the arrangement, the Company recognized revenues from nonrefundable, up-front license fees upon delivery. If these licenses did not have stand-alone value, the Company recognized revenues from nonrefundable, up-front license fees on a straight-line basis over the contracted or estimated period of performance. The Company evaluated the period of performance each reporting period and adjusted the period of performance on a prospective basis if there were changes to be made. | ||||||||||||||||||||
Milestone Payments: At the inception of each agreement that included research and development milestone payments, the Company evaluated whether each milestone was substantive. The Company recognized revenues related to substantive milestones in full in the period in which the substantive milestone was achieved if payment was reasonably assured. If a milestone was not considered substantive, the Company recognized the applicable milestone payment over the period of performance. | ||||||||||||||||||||
Research and Development Activities/Manufacturing Services: If the Company was entitled to reimbursement from its collaborators for specified research and development expenses and/or was entitled to payments for specified manufacturing services that the Company provided through its third-party manufacturing network, the Company determined whether the research and development funding would result in collaborative revenues or an offset to research and development expenses. | ||||||||||||||||||||
Concentration of Credit Risk | ' | |||||||||||||||||||
Concentration of Credit Risk | ||||||||||||||||||||
Financial instruments that potentially subject the Company to concentration of credit risk consist principally of money market funds and marketable securities. The Company places these investments with highly rated financial institutions, and, by policy, limits the amounts of credit exposure to any one financial institution. These amounts at times may exceed federally insured limits. The Company has not experienced any credit losses in these accounts and does not believe it is exposed to any significant credit risk on these funds. The Company implemented a foreign exchange hedging program in December 2013. As of December 31, 2013, the notional amount and fair value of these hedges was not significant. | ||||||||||||||||||||
The Company also is subject to credit risk from its accounts receivable related to its product sales and collaborators. The Company evaluates the creditworthiness of each of its customers and has determined that all of its material customers are creditworthy. To date, the Company has not experienced significant losses with respect to the collection of its accounts receivable. The Company's receivables from Greece and Italy were not material in 2013, and the Company had no receivables from Spain or Portugal in 2013. The Company believes that its allowance for doubtful accounts was adequate at December 31, 2013. Please refer to Note X, "Segment Information," for further information. | ||||||||||||||||||||
Cash and Cash Equivalents | ' | |||||||||||||||||||
Cash and Cash Equivalents | ||||||||||||||||||||
The Company considers all highly liquid investments with original maturities of three months or less at the date of purchase to be cash equivalents. | ||||||||||||||||||||
Restricted Cash | ' | |||||||||||||||||||
Restricted Cash | ||||||||||||||||||||
Restricted cash consists of balances held in deposit with certain banks to collateralize conditional stand-by letters of credit in the names of the Company’s landlords pursuant to certain operating lease agreements. The Company also separately disclosed on its consolidated balance sheet restricted cash and cash equivalents (Alios) as of December 31, 2012. The Company deconsolidated Alios as of December 31, 2013. Please refer to Note B, "Collaborative Arrangements," for further information. | ||||||||||||||||||||
Marketable Securities | ' | |||||||||||||||||||
Marketable Securities | ||||||||||||||||||||
The Company's marketable securities consist of investments in government-sponsored enterprise securities, corporate debt securities and commercial paper that are classified as available-for-sale. The Company classifies marketable securities available to fund current operations as current assets on its consolidated balance sheets. Marketable securities are classified as long-term assets on the consolidated balance sheets if (i) they have been in an unrealized loss position for longer than one year and (ii) the Company has the ability and intent to hold them (a) until the carrying value is recovered and (b) such holding period may be longer than one year. The Company's marketable securities are stated at fair value with their unrealized gains and losses included as a component of accumulated other comprehensive loss, which is a separate component of shareholders’ equity, until such gains and losses are realized. The fair value of these securities is based on quoted prices for identical or similar assets. | ||||||||||||||||||||
The Company reviews investments in marketable securities for other-than-temporary impairment whenever the fair value of an investment is less than the amortized cost and evidence indicates that an investment’s carrying amount is not recoverable within a reasonable period of time. To determine whether an impairment is other-than-temporary, the Company considers whether it has an intent to sell, or whether it is more likely than not that the Company will be required to sell, the investment before recovery of the investment’s amortized cost basis. Evidence considered in this assessment includes reasons for the impairment, compliance with the Company’s investment policy, the severity and the duration of the impairment and changes in value subsequent to year-end. If a decline in the fair value is considered other-than-temporary, based on available evidence, the unrealized loss is transferred from other comprehensive income (loss) to the consolidated statements of operations. | ||||||||||||||||||||
Stock-based Compensation Expense | ' | |||||||||||||||||||
Stock-based Compensation Expense | ||||||||||||||||||||
The Company expenses the fair value of employee stock options and other forms of stock-based employee compensation over the associated employee service period on a straight-line basis. For awards with performance conditions, the Company estimates the likelihood of satisfaction of the performance conditions, which affects the period over which the expense is recognized, and recognizes the expense using the accelerated attribution model. Stock-based compensation expense is determined based on the fair value of the award at the grant date, including estimated forfeitures, and is adjusted each period to reflect actual forfeitures and the outcomes of certain performance conditions. | ||||||||||||||||||||
Research and Development Expenses | ' | |||||||||||||||||||
Research and Development Expenses | ||||||||||||||||||||
The Company expenses as incurred all research and development expenses, including amounts funded by research and development collaborations. The Company capitalizes nonrefundable advance payments made by the Company for research and development activities and expenses the payments as the related goods are delivered or the related services are performed. | ||||||||||||||||||||
Research and development expenses are comprised of costs incurred by the Company in performing research and development activities, including salary and benefits; stock-based compensation expense; laboratory supplies and other direct expenses; contractual services costs, including clinical trial and pharmaceutical development costs; expenses associated with drug supplies that are not being capitalized; and infrastructure costs, including facilities costs and depreciation expense. | ||||||||||||||||||||
Advertising Expenses | ' | |||||||||||||||||||
Advertising Expenses | ||||||||||||||||||||
The Company expenses the costs of advertising, including promotional expenses, as incurred. | ||||||||||||||||||||
Inventories | ' | |||||||||||||||||||
Inventories | ||||||||||||||||||||
The Company values its inventories at the lower-of-cost or market. The Company determines the cost of its inventories, which includes amounts related to materials and manufacturing overhead, on a first-in, first-out basis. The Company performs an assessment of the recoverability of capitalized inventory during each reporting period, and writes down any excess and obsolete inventories to their realizable value in the period in which the impairment is first identified. Shipping and handling costs incurred for inventory purchases are capitalized and recorded upon sale in cost of product revenues in the consolidated statements of operations. Shipping and handling costs incurred for product shipments are recorded as incurred in cost of product revenues in the consolidated statements of operations. | ||||||||||||||||||||
The Company capitalizes inventories produced in preparation for initiating sales of a drug candidate when the related drug candidate is considered to have a high likelihood of regulatory approval and the related costs are expected to be recoverable through sales of the inventories. In determining whether or not to capitalize such inventories, the Company evaluates, among other factors, information regarding the drug candidate’s safety and efficacy, the status of regulatory submissions and communications with regulatory authorities and the outlook for commercial sales, including the existence of current or anticipated competitive drugs and the availability of reimbursement. In addition, the Company evaluates risks associated with manufacturing the drug candidate and the remaining shelf-life of the inventories. | ||||||||||||||||||||
Property and Equipment | ' | |||||||||||||||||||
Property and Equipment | ||||||||||||||||||||
Property and equipment are recorded at cost. Depreciation expense is recorded using the straight-line method over the estimated useful life of the related asset, generally seven to ten years for furniture and equipment, three to five years for computers and software, 40 years for buildings and for leasehold improvements, the useful life of the improvements or the estimated remaining life of the associated lease. Maintenance and repairs to an asset that do not improve or extend its life are charged to operations. When assets are retired or otherwise disposed of, the assets and related accumulated depreciation are eliminated from the accounts and any resulting gain or loss is reflected in the Company’s consolidated statements of operations. The Company performs an assessment of the fair value of the assets if indicators of impairment are identified during a reporting period and records the assets at the lower of the net book value or the fair value of the assets. | ||||||||||||||||||||
The Company capitalizes internal costs incurred to develop software for internal use during the application development stage. The Company expenses costs related to the planning and post-implementation phases of development of software for internal use as these costs are incurred. Maintenance and enhancement costs (including costs in the post-implementation stages) are expensed as incurred, unless such costs relate to substantial upgrades and enhancements to the software resulting in added functionality, in which case the costs are capitalized. Amortization of capitalized internally developed software costs is recorded in depreciation expense over the useful life of the related asset. | ||||||||||||||||||||
The Company records certain construction costs incurred by a landlord as an asset and corresponding financing obligation on the Company's consolidated balance sheets as the owner of the buildings for accounting purposes. | ||||||||||||||||||||
Capital Leases | ' | |||||||||||||||||||
Capital Leases | ||||||||||||||||||||
The assets and liabilities associated with capital lease agreements are recorded at the present value of the minimum lease payments at the inception of the lease agreement. The assets are amortized using the straight-line method over the estimated useful life of the related asset or the remaining life of the associated lease. Amortization of assets that the Company leases pursuant to a capital lease is included in depreciation expense. The Company performs an assessment of the fair value of the assets if indicators of impairment are identified during a reporting period and records the assets at the lower of the net book value or the fair value of the assets. Assets recorded under capital leases are recorded within "Property and equipment, net" and liabilities related to those assets are recorded within "Capital lease obligations, current portion" and "Capital lease obligations, excluding current portion," on the Company's consolidated balance sheets. | ||||||||||||||||||||
Income Taxes | ' | |||||||||||||||||||
Income Taxes | ||||||||||||||||||||
Deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial statement carrying amounts and the income tax bases of assets and liabilities. A valuation allowance is applied against any net deferred tax asset if, based on the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. | ||||||||||||||||||||
The Company records liabilities related to uncertain tax positions by prescribing a minimum recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The Company does not believe any such uncertain tax positions currently pending will have a material adverse effect on its consolidated financial statements. | ||||||||||||||||||||
Variable Interest Entities | ' | |||||||||||||||||||
Variable Interest Entities | ||||||||||||||||||||
The Company reviews each collaboration agreement pursuant to which the Company licenses assets owned by a collaborator in order to determine whether or not the collaborator is a VIE. If the collaborator is a VIE, the Company assesses whether or not the Company is the primary beneficiary of that VIE based on a number of factors, including (i) which party has the power to direct the activities that most significantly affect the VIE’s economic performance, (ii) the parties’ contractual rights and responsibilities pursuant to the collaboration agreement and (iii) which party has the obligation to absorb losses or the right to receive benefits from the VIE. If the Company determines it is the primary beneficiary of a VIE at the onset of the collaboration agreement, the collaboration is treated as a business combination and the Company consolidates the financial statements of the VIE into the Company’s consolidated financial statements. The Company evaluates whether it continues to be the primary beneficiary of any consolidated VIEs on a quarterly basis. If the Company determines that it is no longer the primary beneficiary of a consolidated VIE, or no longer has a variable interest in the VIE, it deconsolidates the VIE in the period that the determination is made. | ||||||||||||||||||||
Business Combinations | ' | |||||||||||||||||||
Business Combinations | ||||||||||||||||||||
The Company assigns the value of consideration, including contingent consideration, transferred in business combinations to the appropriate accounts on the Company's consolidated balance sheet based on their fair value as of the effective date of the transaction. If a collaboration has been treated as a business combination and there are contingent payments, increases in the fair value of the contingent payments pursuant to collaborations accounted for as business combinations result in a decrease in net income attributable to Vertex (or an increase in net loss attributable to Vertex) on a dollar-for-dollar basis. Transaction costs and any restructuring costs associated with these transactions are expensed as incurred. | ||||||||||||||||||||
Fair Value of In-Process Research and Development Asset and Contingent payments in Business Combinations | ' | |||||||||||||||||||
Fair Value of In-process Research and Development Assets and Contingent Payments in Business Combinations | ||||||||||||||||||||
The present-value models used to estimate the fair values of research and development assets and contingent payments pursuant to collaborations incorporate significant assumptions, including: assumptions regarding the probability of obtaining marketing approval and/or achieving relevant development milestones for a drug candidate; estimates regarding the timing of and the expected costs to develop a drug candidate; estimates of future cash flows from potential product sales and/or the potential to achieve certain commercial milestones with respect to a drug candidate; and the appropriate discount and tax rates. | ||||||||||||||||||||
In-process Research and Development Assets | ' | |||||||||||||||||||
In-process Research and Development Assets | ||||||||||||||||||||
The Company records the fair value of in-process research and development assets as of the transaction date of a business combination. Each of these assets is accounted for as an indefinite-lived intangible asset and is maintained on the Company’s consolidated balance sheet until either the project underlying it is completed or the asset becomes impaired. If the asset becomes impaired or is abandoned, the carrying value of the related intangible asset is written down to its fair value, and an impairment charge is recorded in the period in which the impairment occurs. If a project is completed, the carrying value of the related intangible asset is amortized as a part of cost of product revenues over the remaining estimated life of the asset beginning in the period in which the project is completed. In-process research and development assets are tested for impairment on an annual basis as of October 1, and more frequently if indicators are present or changes in circumstances suggest that impairment may exist. | ||||||||||||||||||||
Goodwill | ' | |||||||||||||||||||
Goodwill | ||||||||||||||||||||
The difference between the purchase price and the fair value of assets acquired and liabilities assumed in a business combination is allocated to goodwill. Goodwill is evaluated for impairment on an annual basis as of October 1, and more frequently if indicators are present or changes in circumstances suggest that impairment may exist. | ||||||||||||||||||||
Deconsolidation and Discounted Operations | ' | |||||||||||||||||||
Deconsolidation and Discontinued Operations | ||||||||||||||||||||
Upon the occurrence of certain events and on a regular basis, the Company evaluates whether it no longer has a controlling financial interest in its subsidiaries, including deemed subsidiaries such as consolidated VIEs. If it is determined that the Company no longer has a controlling interest, the subsidiary is deconsolidated. The Company records a gain or loss on deconsolidation based on the difference on the deconsolidation date between (i) the aggregate of (a) the fair value of any consideration received, (b) the fair value of any retained noncontrolling investment in the former subsidiary and (c) the carrying amount of any noncontrolling interest in the subsidiary being deconsolidated, less (ii) the carrying amount of the former subsidiary’s assets and liabilities. | ||||||||||||||||||||
The Company assesses whether a deconsolidation is required to be presented as discontinued operations in its consolidated financial statements on the deconsolidation date. This assessment is based on whether or not (i) the operations and cash flows to the former subsidiary have been or will be eliminated from the Company's ongoing operations as a result of the deconsolidation event and (ii) the Company will have any significant continuing involvement in the operations of the former subsidiary after the deconsolidation event. If the Company determines that a deconsolidation requires presentation as a discontinued operation on the deconsolidation date, or at any point during the one year period following such date, it will present the former subsidiary as a discontinued operation in current and comparative period financial statements. | ||||||||||||||||||||
Derivative Instruments, Embedded Derivatives and Hedging Activities | ' | |||||||||||||||||||
Derivative Instruments, Embedded Derivatives and Hedging Activities | ||||||||||||||||||||
The Company has entered into financial transactions involving free-standing derivative instruments and embedded derivatives in the past. Embedded derivatives are required to be bifurcated from the host instruments because the derivatives are not clearly and closely related to the host instruments. The Company determines the fair value of each derivative instrument or embedded derivative that is identified on the date of issuance and at the end of each quarterly period. The estimates of the fair value of these derivatives, particularly with respect to derivatives related to the achievement of milestones in the development of telaprevir, included significant assumptions regarding the estimates market participants would make in order to evaluate these derivatives. | ||||||||||||||||||||
The Company recognizes the fair value of hedging instruments that are designated and qualify as hedging instruments pursuant to GAAP, primarily foreign currency forward contracts, as either assets or liabilities on the consolidated balance sheets. Changes in the fair value of hedging instruments are recorded each period in accumulated other comprehensive loss until the date of settlement, at which point the cumulative change in the fair value since the inception of the hedge is recognized in "Product revenues, net," in its consolidated statements of operations. The Company classifies the cash flows from hedging instruments in the same category as the cash flows from the hedged items. | ||||||||||||||||||||
The Company assesses, both at inception and on an ongoing basis, whether the foreign currency forward contracts used in hedging transactions are highly effective in offsetting the changes in cash flows of the hedged items. The Company also assesses hedge ineffectiveness quarterly and, if determined to be ineffective, records the gain or loss related to the ineffective portion to earnings in "Other income (expense), net" in the consolidated statements of operations. | ||||||||||||||||||||
Restructuring Expense | ' | |||||||||||||||||||
Restructuring Expenses | ||||||||||||||||||||
The Company records costs and liabilities associated with exit and disposal activities based on estimates of fair value in the period the liabilities are incurred. In periods subsequent to the initial measurement, the Company measures changes to the liability using the credit-adjusted risk-free discount rate applied in the initial period. The Company evaluates and adjusts these liabilities as appropriate for changes in circumstances at least on a quarterly basis. | ||||||||||||||||||||
Comprehensive Income (Loss) | ' | |||||||||||||||||||
Comprehensive Income (Loss) | ||||||||||||||||||||
Comprehensive income (loss) consists of net income (loss) and other comprehensive income (loss), which includes foreign currency translation adjustments and unrealized gains and losses on foreign currency forward contracts and certain marketable securities. For purposes of comprehensive income (loss) disclosures, the Company does not record tax provisions or benefits, as the Company intends to permanently reinvest undistributed earnings in its foreign subsidiaries. | ||||||||||||||||||||
Foreign Currency Translation and Transactions | ' | |||||||||||||||||||
Foreign Currency Translation and Transactions | ||||||||||||||||||||
All material consolidated entities have the U.S. dollar as their functional currency. Non-U.S. dollar functional currency subsidiaries have assets and liabilities translated into U.S. dollars at rates of exchange in effect at the end of the year. Revenue and expense amounts are translated using the average exchange rates for the period. Net unrealized gains and losses resulting from foreign currency translation are included in accumulated other comprehensive loss, which is a separate component of shareholders’ equity. | ||||||||||||||||||||
Net Income (Loss) Per Share Attributable to Vertex Common Stockholders | ' | |||||||||||||||||||
Net Income (Loss) Per Share Attributable to Vertex Common Shareholders | ||||||||||||||||||||
Basic and diluted net income per share attributable to Vertex common shareholders are presented in conformity with the two-class method required for participating securities. Under the two-class method, earnings are allocated to (i) Vertex common shares, excluding unvested restricted stock, and (ii) participating securities, based on their respective weighted-average shares outstanding for the period. Shares of unvested restricted stock granted under the Company's Amended and Restated 2006 Stock and Option Plan have the non-forfeitable right to receive dividends on an equal basis with other outstanding common stock. As a result, these unvested shares of restricted stock are considered participating securities under the two-class method. Potentially dilutive shares result from the assumed exercise of outstanding stock options (the proceeds of which are then assumed to have been used to repurchase outstanding stock using the treasury stock method) and the assumed conversion of convertible notes. | ||||||||||||||||||||
Basic net loss per share attributable to Vertex common shareholders is based upon the weighted-average number of common shares outstanding during the period, excluding restricted stock that has been issued but is not yet vested. Diluted net loss per share attributable to Vertex common shareholders is based upon the weighted-average number of common shares outstanding during the period plus additional weighted-average common equivalent shares outstanding during the period when the effect is dilutive. | ||||||||||||||||||||
Recent Accounting Pronouncements | ' | |||||||||||||||||||
Recent Accounting Pronouncements | ||||||||||||||||||||
The Company did not adopt any new accounting pronouncements during 2013 that had a material effect on the Company’s consolidated financial statements. |
Nature_of_Business_and_Account2
Nature of Business and Accounting Policies (Tables) | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
Accounting Policies [Abstract] | ' | |||||||||||||||||||
Schedule of product revenues allowances and reserve categories | ' | |||||||||||||||||||
The following table summarizes activity in each of the product revenue allowance and reserve categories for the three years ended December 31, 2013: | ||||||||||||||||||||
Trade | Rebates, | Product | Other | Total | ||||||||||||||||
Allowances | Chargebacks | Returns | Incentives | |||||||||||||||||
and Discounts | ||||||||||||||||||||
(in thousands) | ||||||||||||||||||||
2013 | ||||||||||||||||||||
Beginning Balance | $ | 5,416 | $ | 63,560 | $ | 2,852 | $ | 3,565 | $ | 75,393 | ||||||||||
Provision related to current period sales | 31,395 | 204,459 | 5,795 | 9,295 | 250,944 | |||||||||||||||
Adjustments related to prior period sales | 343 | 4,474 | 15,149 | (228 | ) | 19,738 | ||||||||||||||
Credits/payments made | (35,619 | ) | (204,249 | ) | (7,997 | ) | (11,077 | ) | (258,942 | ) | ||||||||||
Ending Balance | $ | 1,535 | $ | 68,244 | $ | 15,799 | $ | 1,555 | $ | 87,133 | ||||||||||
2012 | ||||||||||||||||||||
Beginning Balance | $ | 11,162 | $ | 52,659 | $ | 340 | $ | 5,202 | $ | 69,363 | ||||||||||
Provision related to current period sales | 55,913 | 216,942 | 2,067 | 19,103 | 294,025 | |||||||||||||||
Adjustments related to prior period sales | 29 | 3,883 | 1,498 | 72 | 5,482 | |||||||||||||||
Credits/payments made | (61,688 | ) | (209,924 | ) | (1,053 | ) | (20,812 | ) | (293,477 | ) | ||||||||||
Ending Balance | $ | 5,416 | $ | 63,560 | $ | 2,852 | $ | 3,565 | $ | 75,393 | ||||||||||
2011 | ||||||||||||||||||||
Beginning Balance | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||
Provision related to current period sales | 38,228 | 75,145 | 553 | 9,692 | 123,618 | |||||||||||||||
Credits/payments made | (27,066 | ) | (22,486 | ) | (213 | ) | (4,490 | ) | (54,255 | ) | ||||||||||
Ending Balance | $ | 11,162 | $ | 52,659 | $ | 340 | $ | 5,202 | $ | 69,363 | ||||||||||
Collaborative_Arrangements_Tab
Collaborative Arrangements (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Collaborative Arrangements | ' | |||||||||||
Collaborator revenues | ' | |||||||||||
MTPC Agreement for 2012 or 2011: | ||||||||||||
2012 | 2011 | |||||||||||
(in thousands) | ||||||||||||
Amortized portion of up-front payments | $ | 12,744 | $ | 38,232 | ||||||||
Milestone revenues | 485 | 68,515 | ||||||||||
Payments for manufacturing services | 5,650 | 14,928 | ||||||||||
Total collaborative revenues attributable to the Mitsubishi Tanabe collaboration | $ | 18,879 | $ | 121,675 | ||||||||
During the three years ended December 31, 2013, the Company recognized the following revenues attributable to the Janssen collaboration: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(in thousands) | ||||||||||||
Royalty revenues | $ | 130,724 | $ | 117,592 | $ | 20,289 | ||||||
Collaborative revenues: | ||||||||||||
Up-front and amendment payments revenues | $ | 190,345 | $ | 12,428 | $ | 12,428 | ||||||
Milestone revenues | — | — | 250,000 | |||||||||
Net reimbursement (payment) for telaprevir development costs | 2,793 | (3,507 | ) | (8,418 | ) | |||||||
Reimbursement for manufacturing services | 10,299 | 7,257 | 20,383 | |||||||||
Total collaborative revenues attributable to the Janssen collaboration | $ | 203,437 | $ | 16,178 | $ | 274,393 | ||||||
Total revenues attributable to the Janssen collaboration | $ | 334,161 | $ | 133,770 | $ | 294,682 | ||||||
Summary of activity related to net loss (income) attributable to noncontrolling interest (Alios) | ' | |||||||||||
A summary of net loss (income) attributable to noncontrolling interest (Alios) for the three years ended December 31, 2013 is as follows: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(in thousands) | ||||||||||||
Loss before provision for (benefit from) income taxes | $ | 283,747 | $ | 20,044 | $ | 9,536 | ||||||
Decrease (increase) in fair value of contingent milestone and royalty payments | 124,920 | (114,970 | ) | (69,950 | ) | |||||||
Provision for (benefit from) income taxes | (166,145 | ) | 39,029 | 48,809 | ||||||||
Net loss (income) attributable to noncontrolling interest (Alios) | $ | 242,522 | $ | (55,897 | ) | $ | (11,605 | ) | ||||
Summary of Alios' items included in the Company's consolidated balance sheets | ' | |||||||||||
Alios Balance Sheet Information | ||||||||||||
The Company included items related to Alios on the Company's consolidated balance sheet as of December 31, 2012. Due to the deconsolidation of Alios as of December 31, 2013, these items were not included on the Company's consolidated balance sheet as of December 31, 2013. The following table summaries items related to the Alios included on the Company's consolidated balance sheet as of December 31, 2012. | ||||||||||||
As of December 31, 2012 | ||||||||||||
(in thousands) | ||||||||||||
Restricted cash and cash equivalents (Alios) | $ | 69,983 | ||||||||||
Prepaid expenses and other current assets | $ | 672 | ||||||||||
Property and equipment, net | $ | 1,728 | ||||||||||
Intangible assets | $ | 250,600 | ||||||||||
Other assets | $ | 861 | ||||||||||
Accounts payable | $ | 1,054 | ||||||||||
Accrued expenses | $ | 6,099 | ||||||||||
Income taxes payable (Alios) | $ | 715 | ||||||||||
Deferred tax liability | $ | 152,781 | ||||||||||
Other liabilities, excluding current portion | $ | 910 | ||||||||||
Redeemable noncontrolling interest (Alios) | $ | 38,530 | ||||||||||
Noncontrolling interest (Alios) | $ | 196,672 | ||||||||||
As of December 31, 2012, the Company recorded Alios’ cash and cash equivalents as restricted cash and cash equivalents (Alios) because (i) the Company did not have any interest in or control over Alios’ cash and cash equivalents and (ii) the Alios Agreement did not provide for these assets to be used for the development of the assets that the Company licenses from Alios pursuant to the Alios Agreement. Assets recorded as a result of consolidating Alios’ financial condition into the Company’s consolidated balance sheet did not represent additional assets that could have been used to satisfy claims against the Company’s general assets. |
Net_Income_Loss_Per_Share_Attr1
Net Income (Loss) Per Share Attributable to Vertex Common Shareholders (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Earnings Per Share [Abstract] | ' | |||||||||||
Calculation of net income (loss) per basic and diluted share | ' | |||||||||||
The following table sets forth the computation of basic and diluted net income (loss) per share for the three years ended December 31, 2013: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(in thousands, except per share amounts) | ||||||||||||
Basic net income (loss) attributable to Vertex per common share calculation: | ||||||||||||
Net income (loss) attributable to Vertex common shareholders | $ | (445,028 | ) | $ | (107,032 | ) | $ | 29,574 | ||||
Less: Undistributed earnings allocated to participating securities | — | — | (291 | ) | ||||||||
Net income (loss) attributable to Vertex common shareholders—basic | $ | (445,028 | ) | $ | (107,032 | ) | $ | 29,283 | ||||
Basic weighted-average common shares outstanding | 224,906 | 211,946 | 204,891 | |||||||||
Basic net income (loss) attributable to Vertex per common share | $ | (1.98 | ) | $ | (0.50 | ) | $ | 0.14 | ||||
Diluted net income (loss) attributable to Vertex per common share calculation: | ||||||||||||
Net income (loss) attributable to Vertex common shareholders | $ | (445,028 | ) | $ | (107,032 | ) | $ | 29,574 | ||||
Less: Undistributed earnings allocated to participating securities | — | — | (285 | ) | ||||||||
Net income (loss) attributable to Vertex common shareholders—diluted | $ | (445,028 | ) | $ | (107,032 | ) | $ | 29,289 | ||||
Weighted-average shares used to compute basic net income (loss) per common share | 224,906 | 211,946 | 204,891 | |||||||||
Effect of potentially dilutive securities: | ||||||||||||
Stock options | — | — | 3,863 | |||||||||
Other | — | — | 53 | |||||||||
Weighted-average shares used to compute diluted net income (loss) per common share | 224,906 | 211,946 | 208,807 | |||||||||
Diluted net income (loss) attributable to Vertex per common share | $ | (1.98 | ) | $ | (0.50 | ) | $ | 0.14 | ||||
Potential gross common equivalent shares | ' | |||||||||||
The Company did not include the securities described in the following table in the computation of the diluted net income (loss) attributable to Vertex per common share calculations because the effect would have been anti-dilutive during each such period: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(in thousands) | ||||||||||||
Stock options | 15,729 | 19,726 | 9,626 | |||||||||
Convertible senior subordinated notes | — | 8,192 | 8,192 | |||||||||
Unvested restricted stock and restricted stock units | 2,165 | 2,350 | 8 | |||||||||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||
Financial assets subject to fair value measurements (excluding restricted cash and cash equivalents (Alios)) | ' | |||||||||||||||
The following table sets forth the Company’s financial assets subject to fair value measurements: | ||||||||||||||||
Fair Value Measurements as | ||||||||||||||||
of December 31, 2013 | ||||||||||||||||
Fair Value Hierarchy | ||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||||
(in thousands) | ||||||||||||||||
Financial assets carried at fair value: | ||||||||||||||||
Cash equivalents: | ||||||||||||||||
Money market funds | $ | 255,689 | $ | 255,689 | $ | — | $ | — | ||||||||
Marketable securities: | ||||||||||||||||
Government-sponsored enterprise securities | 600,450 | 600,450 | — | — | ||||||||||||
Commercial paper | 83,493 | — | 83,493 | — | ||||||||||||
Corporate debt securities | 211,834 | — | 211,834 | — | ||||||||||||
Total | $ | 1,151,466 | $ | 856,139 | $ | 295,327 | $ | — | ||||||||
Marketable_Securities_Tables
Marketable Securities (Tables) | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Cash and Cash Equivalents [Abstract] | ' | |||||||||||||||
Summary of cash, cash equivalents and marketable securities | ' | |||||||||||||||
A summary of the Company’s cash, cash equivalents and marketable securities is shown below: | ||||||||||||||||
Amortized Cost | Gross | Gross | Fair Value | |||||||||||||
Unrealized | Unrealized | |||||||||||||||
Gains | Losses | |||||||||||||||
(in thousands) | ||||||||||||||||
31-Dec-13 | ||||||||||||||||
Cash and cash equivalents: | ||||||||||||||||
Cash and money market funds | $ | 569,299 | $ | — | $ | — | $ | 569,299 | ||||||||
Total cash and cash equivalents | $ | 569,299 | $ | — | $ | — | $ | 569,299 | ||||||||
Marketable securities: | ||||||||||||||||
Government-sponsored enterprise securities (due within 1 year) | $ | 600,496 | $ | 7 | $ | (53 | ) | $ | 600,450 | |||||||
Commercial paper (due within 1 year) | 83,384 | 109 | — | 83,493 | ||||||||||||
Corporate debt securities (due within 1 year) | 189,674 | 14 | (34 | ) | 189,654 | |||||||||||
Corporate debt securities (due after 1 year through 5 years) | 22,181 | 6 | (7 | ) | 22,180 | |||||||||||
Total marketable securities | $ | 895,735 | $ | 136 | $ | (94 | ) | $ | 895,777 | |||||||
Total cash, cash equivalents and marketable securities | $ | 1,465,034 | $ | 136 | $ | (94 | ) | $ | 1,465,076 | |||||||
31-Dec-12 | ||||||||||||||||
Cash and cash equivalents: | ||||||||||||||||
Cash and money market funds | $ | 489,407 | $ | — | $ | — | $ | 489,407 | ||||||||
Total cash and cash equivalents | $ | 489,407 | $ | — | $ | — | $ | 489,407 | ||||||||
Marketable securities: | ||||||||||||||||
U.S. Treasury securities (due within 1 year) | $ | 111,350 | $ | 2 | $ | (2 | ) | $ | 111,350 | |||||||
Government-sponsored enterprise securities (due within 1 year) | 440,181 | 49 | (5 | ) | 440,225 | |||||||||||
Commercial paper (due within 1 year) | 225,294 | 155 | — | 225,449 | ||||||||||||
Corporate debt securities (due within 1 year) | 15,429 | 1 | (1 | ) | 15,429 | |||||||||||
Corporate debt securities (due after 1 year through 5 years) | 39,358 | 10 | (13 | ) | 39,355 | |||||||||||
Total marketable securities | $ | 831,612 | $ | 217 | $ | (21 | ) | $ | 831,808 | |||||||
Total cash, cash equivalents and marketable securities | $ | 1,321,019 | $ | 217 | $ | (21 | ) | $ | 1,321,215 | |||||||
Accumulated_Other_Comprehensiv1
Accumulated Other Comprehensive Loss (Tables) | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Equity [Abstract] | ' | |||||||||||||||
Reclassifications out of Accumulated Other Comprehensive Income | ' | |||||||||||||||
The following table summarizes the changes in accumulated other comprehensive loss by component: | ||||||||||||||||
Foreign currency translation adjustment | Unrealized holding gains on marketable securities | Unrealized losses on foreign currency forward contracts | Total | |||||||||||||
(in thousands) | ||||||||||||||||
Balance at December 31, 2012 | $ | (746 | ) | $ | 196 | $ | — | $ | (550 | ) | ||||||
Other comprehensive income (loss) before reclassifications | 421 | (154 | ) | (23 | ) | 244 | ||||||||||
Amounts reclassified from accumulated other comprehensive loss | — | — | — | — | ||||||||||||
Net current period other comprehensive income (loss) | 421 | (154 | ) | (23 | ) | 244 | ||||||||||
Balance at December 31, 2013 | $ | (325 | ) | $ | 42 | $ | (23 | ) | $ | (306 | ) | |||||
Inventories_Tables
Inventories (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Inventory Disclosure [Abstract] | ' | |||||||
Schedule of Inventories by Type | ' | |||||||
Inventories consisted of the following: | ||||||||
As of December 31, | ||||||||
2013 | 2012 | |||||||
(in thousands) | ||||||||
Raw materials | $ | 489 | $ | 3,754 | ||||
Work-in-process | 9,981 | 11,317 | ||||||
Finished goods | 3,677 | 15,393 | ||||||
Total | $ | 14,147 | $ | 30,464 | ||||
Property_and_Equipment_Tables
Property and Equipment (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||
Schedule of Property and equipment | ' | |||||||
Property and equipment, net consisted of the following: | ||||||||
As of December 31, | ||||||||
2013 | 2012 | |||||||
(in thousands) | ||||||||
Buildings | $ | 506,056 | $ | — | ||||
Furniture and equipment | 190,555 | 173,766 | ||||||
Leasehold improvements | 163,019 | 123,770 | ||||||
Software | 102,520 | 101,276 | ||||||
Computers | 43,096 | 40,779 | ||||||
Construction-in-process | — | 290,703 | ||||||
Total property and equipment, gross | 1,005,246 | 730,294 | ||||||
Less: accumulated depreciation | (308,335 | ) | (296,685 | ) | ||||
Total property and equipment, net | $ | 696,911 | $ | 433,609 | ||||
Accrued_Expenses_and_Other_Lia1
Accrued Expenses and Other Liabilities, Current Portion (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Payables and Accruals [Abstract] | ' | |||||||
Accrued expenses and other current liabilities | ' | |||||||
Accrued expenses consisted of the following: | ||||||||
As of December 31, | ||||||||
2013 | 2012 | |||||||
(in thousands) | ||||||||
Product revenue allowances | $ | 85,510 | $ | 69,936 | ||||
Payroll and benefits | 76,785 | 62,140 | ||||||
Research, development and commercial contract costs | 52,468 | 63,960 | ||||||
Royalty payable | 18,334 | 29,007 | ||||||
Other | 16,241 | 18,932 | ||||||
Professional fees | 10,593 | 11,226 | ||||||
Taxes payable | 8,362 | 2,182 | ||||||
Unrecognized tax benefits | 2,784 | 4,106 | ||||||
Interest | — | 3,395 | ||||||
Total | $ | 271,077 | $ | 264,884 | ||||
Common_Stock_Preferred_Stock_a1
Common Stock, Preferred Stock and Equity Plans (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Common Stock, Preferred Stock and Equity Plans | ' | ||||||||||||||||
Stock and Stock Option Equity Plans | ' | ||||||||||||||||
The following table contains information about the Company’s equity plans: | |||||||||||||||||
As of December 31, 2013 | |||||||||||||||||
Title of Plan | Group Eligible | Type of Award | Awards | Additional Awards | |||||||||||||
Granted | Outstanding | Authorized for | |||||||||||||||
Grant | |||||||||||||||||
2013 Stock and Option Plan | Employees, Non-employee Directors and Consultants | NSO, ISO, | 1,170,827 | 2,129,173 | |||||||||||||
RS and RSU | |||||||||||||||||
2006 Stock and Option Plan | Employees, Non-employee Directors and Consultants | NSO, ISO, | 15,748,949 | 3,282,178 | |||||||||||||
RS and RSU | |||||||||||||||||
1996 Stock and Option Plan | Employees, Non-employee Directors, Advisors and Consultants | NSO, ISO and RS | 974,303 | — | |||||||||||||
Total | 17,894,079 | 5,411,351 | |||||||||||||||
Outstanding and vested options | ' | ||||||||||||||||
The following table summarizes information related to the outstanding and exercisable options during the year ended December 31, 2013: | |||||||||||||||||
Stock Options | Weighted-average | Weighted-average | Aggregate Intrinsic | ||||||||||||||
Exercise Price | Remaining | Value | |||||||||||||||
Contractual Life | |||||||||||||||||
(in thousands) | (per share) | (in years) | (in thousands) | ||||||||||||||
Outstanding at December 31, 2012 | 19,726 | $ | 38.09 | ||||||||||||||
Granted | 4,840 | $ | 57.87 | ||||||||||||||
Exercised | (6,995 | ) | $ | 35.28 | |||||||||||||
Forfeited | (1,822 | ) | $ | 46.89 | |||||||||||||
Expired | (20 | ) | $ | 46.64 | |||||||||||||
Outstanding at December 31, 2013 | 15,729 | $ | 44.4 | 6.67 | $ | 481,311 | |||||||||||
Exercisable at December 31, 2013 | 7,950 | $ | 38.84 | 5.13 | $ | 283,146 | |||||||||||
Exercisable and Expected to Vest at December 31, 2013 | 14,967 | $ | 43.95 | 6.56 | $ | 463,885 | |||||||||||
Stock options outstanding and exercisable | ' | ||||||||||||||||
The following table summarizes information about stock options outstanding and exercisable at December 31, 2013: | |||||||||||||||||
Options Outstanding | Options Exercisable | ||||||||||||||||
Range of Exercise Prices | Number | Weighted-average | Weighted-average | Number | Weighted-average | ||||||||||||
Outstanding | Remaining | Exercise Price | Exercisable | Exercise Price | |||||||||||||
Contractual Life | |||||||||||||||||
(in thousands) | (in years) | (per share) | (in thousands) | (per share) | |||||||||||||
$ 9.09–$20.00 | 432 | 2.37 | $ | 15.37 | 432 | $ | 15.37 | ||||||||||
$20.01–$30.00 | 1,055 | 5.74 | $ | 29.38 | 812 | $ | 29.23 | ||||||||||
$30.01–$40.00 | 6,842 | 5.07 | $ | 36.55 | 4,773 | $ | 36.06 | ||||||||||
$40.01–$50.00 | 4,136 | 8.74 | $ | 46.32 | 787 | $ | 46.62 | ||||||||||
$50.01–$60.00 | 1,713 | 7.16 | $ | 53.78 | 874 | $ | 54.35 | ||||||||||
$60.01–$70.00 | 80 | 9.08 | $ | 65.54 | 14 | $ | 63.2 | ||||||||||
$70.01-$80.00 | 87 | 9.31 | $ | 77.55 | 9 | $ | 77.73 | ||||||||||
$80.01–$88.18 | 1,384 | 9.5 | $ | 83.11 | 249 | $ | 82.13 | ||||||||||
Total | 15,729 | 6.67 | $ | 44.4 | 7,950 | $ | 38.84 | ||||||||||
Restricted stock activity | ' | ||||||||||||||||
The following table summarizes the restricted stock activity of the Company during the year ended December 31, 2013: | |||||||||||||||||
Restricted | Weighted-average | ||||||||||||||||
Stock | Grant-date | ||||||||||||||||
Fair Value | |||||||||||||||||
(in thousands) | (per share) | ||||||||||||||||
Unvested at December 31, 2012 | 2,270 | $ | 42.92 | ||||||||||||||
Granted | 1,356 | $ | 62.16 | ||||||||||||||
Vested | (800 | ) | $ | 42.27 | |||||||||||||
Cancelled | (780 | ) | $ | 51.47 | |||||||||||||
Unvested at December 31, 2013 | 2,046 | $ | 52.66 | ||||||||||||||
Shares issued under Employee Stock Purchase Plan | ' | ||||||||||||||||
In 2013, the following shares were issued to employees under the ESPP: | |||||||||||||||||
Year Ended December 31, 2013 | |||||||||||||||||
(in thousands, | |||||||||||||||||
except per share amount) | |||||||||||||||||
Number of shares | 527 | ||||||||||||||||
Average price paid per share | $ | 36.21 | |||||||||||||||
Stockbased_Compensation_Expens1
Stock-based Compensation Expense (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||
Stock-based compensation expense by line item | ' | |||||||||||
The effect of stock-based compensation expense during the three years ended December 31, 2013 was as follows: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(in thousands) | ||||||||||||
Stock-based compensation expense by line item: | ||||||||||||
Research and development expenses | $ | 81,467 | $ | 71,533 | $ | 75,574 | ||||||
Sales, general and administrative expenses | 45,836 | 42,752 | 42,652 | |||||||||
Total stock-based compensation expense included in costs and expenses | $ | 127,303 | $ | 114,285 | $ | 118,226 | ||||||
Stock-based compensation expense by type of award | ' | |||||||||||
The stock-based compensation expense by type of award during the three years ended December 31, 2013 was as follows: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(in thousands) | ||||||||||||
Stock-based compensation expense by type of award: | ||||||||||||
Stock options | $ | 85,067 | $ | 79,047 | $ | 83,098 | ||||||
Restricted stock and restricted stock units | 36,479 | 29,194 | 30,708 | |||||||||
ESPP share issuances | 6,805 | 7,298 | 5,462 | |||||||||
Less: stock-based compensation expense capitalized to inventories | (1,048 | ) | (1,254 | ) | (1,042 | ) | ||||||
Total stock-based compensation expense included in costs and expenses | $ | 127,303 | $ | 114,285 | $ | 118,226 | ||||||
Unrecognized stock-based compensation expense, net of estimated forfeitures | ' | |||||||||||
The following table sets forth the Company’s unrecognized stock-based compensation expense, net of estimated forfeitures, as of December 31, 2013, by type of award and the weighted-average period over which that expense is expected to be recognized: | ||||||||||||
As of December 31, 2013 | ||||||||||||
Unrecognized Expense | Weighted-average | |||||||||||
Net of | Recognition | |||||||||||
Estimated Forfeitures | Period | |||||||||||
(in thousands) | (in years) | |||||||||||
Type of award: | ||||||||||||
Stock options | $ | 141,283 | 2.56 | |||||||||
Restricted stock and restricted stock units | $ | 73,490 | 2.47 | |||||||||
ESPP share issuances | $ | 5,956 | 0.67 | |||||||||
Schedule of assumptions used to estimate the grant date fair value of options | ' | |||||||||||
The fair value of each option granted during 2013, 2012 and 2011 was estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Expected stock price volatility | 46.2 | % | 47.93 | % | 49.53 | % | ||||||
Risk-free interest rate | 1.25 | % | 0.95 | % | 2.09 | % | ||||||
Expected term of options (in years) | 5.81 | 5.78 | 5.74 | |||||||||
Expected annual dividends | — | — | — | |||||||||
Schedule of assumptions used to estimate the grant date fair value employee stock purchase plan | ' | |||||||||||
The following table reflects the weighted-average assumptions used in the Black-Scholes option pricing model for 2013, 2012 and 2011: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Expected stock price volatility | 54.69 | % | 46.9 | % | 51.32 | % | ||||||
Risk-free interest rate | 0.08 | % | 0.16 | % | 0.08 | % | ||||||
Expected term (in years) | 0.74 | 0.74 | 0.72 | |||||||||
Expected annual dividends | — | — | — | |||||||||
September_2009_Financial_Trans1
September 2009 Financial Transactions (Tables) | 12 Months Ended | |||
Dec. 31, 2013 | ||||
September 2009 Financial Transactions | ' | |||
Expenses and Losses (Gains) Related to September 2009 Financial Transactions | ' | |||
The table below sets forth the total expenses related to the September 2009 financial transactions for 2011: | ||||
2011 | ||||
(in thousands) | ||||
Expenses and Losses (Gains): | ||||
Interest expense related to 2012 Notes | $ | 21,687 | ||
Change in fair value of embedded derivative related to 2012 Notes | (400 | ) | ||
Change in fair value of free-standing derivatives related to the sale of milestone payments | 17,201 | |||
Total September 2009 financial transaction expenses | $ | 38,488 | ||
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Income Tax Disclosure [Abstract] | ' | |||||||||||
Schedule of components of income (loss) before provision for (benefit from) income taxes | ' | |||||||||||
The components of income (loss) before provision for (benefit from) income taxes during the three years ended December 31, 2013 consisted of the following: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(in thousands) | ||||||||||||
United States | $ | (390,009 | ) | $ | 256,816 | $ | 343,515 | |||||
Foreign | (586,108 | ) | (269,197 | ) | (283,070 | ) | ||||||
Income (loss) before provision for (benefit from) income taxes | $ | (976,117 | ) | $ | (12,381 | ) | $ | 60,445 | ||||
Schedule of components of provision for (benefit from) income taxes | ' | |||||||||||
The components of the provision for (benefit from) income taxes during the three years ended December 31, 2013 consisted of the following: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(in thousands) | ||||||||||||
Current taxes: | ||||||||||||
United States | $ | (11,420 | ) | $ | 2,057 | $ | 22,275 | |||||
Foreign | 1,084 | (1,865 | ) | (561 | ) | |||||||
State | 2,136 | 1,902 | 8,655 | |||||||||
Total current taxes | $ | (8,200 | ) | $ | 2,094 | $ | 30,369 | |||||
Deferred taxes: | ||||||||||||
United States | $ | (131,281 | ) | $ | 31,308 | $ | 19,629 | |||||
Foreign | (127,587 | ) | — | (32,692 | ) | |||||||
State | (21,499 | ) | 5,352 | 1,960 | ||||||||
Total deferred taxes | $ | (280,367 | ) | $ | 36,660 | $ | (11,103 | ) | ||||
Provision for (benefit from) income taxes | $ | (288,567 | ) | $ | 38,754 | $ | 19,266 | |||||
Reconciliation of the provision for (benefit from) income taxes | ' | |||||||||||
The difference between the Company’s “expected” tax provision (benefit), as computed by applying the U.S. federal corporate tax rate of 35% to income (loss) before provision for (benefit from) income taxes, and actual tax is reconciled as follows: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(in thousands) | ||||||||||||
Income (loss) before provision for (benefit from) income taxes | $ | (976,117 | ) | $ | (12,381 | ) | $ | 60,445 | ||||
Expected tax provision (benefit) | (341,641 | ) | (4,333 | ) | 21,156 | |||||||
State taxes, net of federal benefit | (19,268 | ) | 7,075 | 10,624 | ||||||||
Foreign rate differential | 72,961 | 62,425 | 43,629 | |||||||||
Tax credits | (16,775 | ) | (1,980 | ) | (51,086 | ) | ||||||
Unbenefited operating losses | (43,570 | ) | (30,364 | ) | (6,286 | ) | ||||||
Non-deductible expenses | 9,614 | 3,198 | 1,953 | |||||||||
Rate change | 50,076 | 3,275 | — | |||||||||
Other | 36 | (542 | ) | (724 | ) | |||||||
Provision for (benefit from) income taxes | $ | (288,567 | ) | $ | 38,754 | $ | 19,266 | |||||
Schedule of unrecognized tax benefits | ' | |||||||||||
Unrecognized tax benefits during the two years ended December 31, 2013 consisted of the following: | ||||||||||||
2013 | 2012 | |||||||||||
(in thousands) | ||||||||||||
Unrecognized tax benefits beginning of year | $ | 4,106 | $ | 4,360 | ||||||||
Gross change for current year positions | 1,325 | 598 | ||||||||||
Increase for prior period positions | — | — | ||||||||||
Decrease for prior period positions | (290 | ) | — | |||||||||
Decrease due to settlements and payments | — | — | ||||||||||
Decrease due to statute limitations | (185 | ) | (852 | ) | ||||||||
Deconsolidation of Alios | (2,932 | ) | — | |||||||||
Unrecognized tax benefits end of year | $ | 2,024 | $ | 4,106 | ||||||||
Schedule of deferred tax assets and liabilities | ' | |||||||||||
Deferred tax assets and liabilities are determined based on the difference between financial statement and tax bases using enacted tax rates in effect for the year in which the differences are expected to reverse. The components of the deferred taxes were as follows: | ||||||||||||
As of December 31, | ||||||||||||
2013 | 2012 | |||||||||||
(in thousands) | ||||||||||||
Deferred tax assets: | ||||||||||||
Net operating loss | $ | 850,946 | $ | 777,687 | ||||||||
Tax credit carryforwards | 180,380 | 147,074 | ||||||||||
Property and equipment | — | 10,701 | ||||||||||
Intangible assets | 26,105 | 63,353 | ||||||||||
Deferred revenues | 25,158 | 44,867 | ||||||||||
Stock-based compensation | 63,521 | 83,979 | ||||||||||
Inventories | 26,278 | 56,564 | ||||||||||
Accrued expenses | 52,470 | 27,945 | ||||||||||
Currency translation adjustment | 217 | — | ||||||||||
Construction financing lease obligation | 152,688 | — | ||||||||||
Gross deferred tax assets | 1,377,763 | 1,212,170 | ||||||||||
Valuation allowance | (1,243,664 | ) | (1,211,561 | ) | ||||||||
Total deferred tax assets | 134,099 | 609 | ||||||||||
Deferred tax liabilities: | ||||||||||||
Property and equipment | (134,099 | ) | — | |||||||||
Unrealized gain | — | (376 | ) | |||||||||
Contingent milestone and royalty payment obligation | — | (50,904 | ) | |||||||||
Acquired intangibles | — | (229,696 | ) | |||||||||
Net deferred tax liabilities | $ | — | $ | (280,367 | ) | |||||||
Restructuring_Expense_Tables
Restructuring Expense (Tables) | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Restructuring and Related Activities [Abstract] | ' | |||||||||||||||
Restructuring and other liabilities | ' | |||||||||||||||
The activity related to restructuring and other liability for 2003 was as follows: | ||||||||||||||||
Restructuring Expense | Cash | Non-cash | Liability as of | |||||||||||||
Payments | Expense | December 31, | ||||||||||||||
2003 | ||||||||||||||||
(in thousands) | ||||||||||||||||
Lease restructuring and other operating lease expense | $ | 84,726 | $ | (15,200 | ) | $ | — | $ | 69,526 | |||||||
Employee severance, benefits and related costs | 2,616 | (2,616 | ) | — | — | |||||||||||
Leasehold improvements and asset impairments | 4,482 | — | (4,482 | ) | — | |||||||||||
Total | $ | 91,824 | $ | (17,816 | ) | $ | (4,482 | ) | $ | 69,526 | ||||||
Activity related to the restructuring liability | ' | |||||||||||||||
The activity related to 2003 restructuring for 2004 through 2013 was as follows: | ||||||||||||||||
2013 | 2012 | 2011 | 2004-2013 | |||||||||||||
(in thousands) | ||||||||||||||||
Liability, beginning of the period | $ | 23,328 | $ | 26,313 | $ | 29,595 | $ | 69,526 | ||||||||
Cash payments | (15,255 | ) | (14,853 | ) | (14,904 | ) | (178,952 | ) | ||||||||
Cash received from subleases | 10,670 | 10,024 | 9,548 | 75,708 | ||||||||||||
Credit for portion of facility Vertex decided to occupy in 2005 | — | — | — | (10,018 | ) | |||||||||||
Restructuring expense | 372 | 1,844 | 2,074 | 62,851 | ||||||||||||
Liability, end of the period | $ | 19,115 | $ | 23,328 | $ | 26,313 | $ | 19,115 | ||||||||
Restructuring and related costs | ' | |||||||||||||||
The restructuring charges recorded during 2013 for each major type of cost associated with this restructuring plan were as follows: | ||||||||||||||||
Restructuring Expense | Cash | Non-cash Expense | Liability as of | |||||||||||||
Payments | December 31, | |||||||||||||||
2013 | ||||||||||||||||
(in thousands) | ||||||||||||||||
Employee severance, benefits and related costs | $ | 25,060 | $ | (21,458 | ) | $ | (1,312 | ) | $ | 2,290 | ||||||
Asset impairments | 6,282 | — | (6,282 | ) | — | |||||||||||
Contract termination and other associated costs | 7,609 | (1,458 | ) | — | 6,151 | |||||||||||
Total | $ | 38,951 | $ | (22,916 | ) | $ | (7,594 | ) | $ | 8,441 | ||||||
Employee_Benefits_Tables
Employee Benefits (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Compensation and Retirement Disclosure [Abstract] | ' | |||||||||||
Matching contributions to the Vertex 401(k) Plan | ' | |||||||||||
The Company declared matching contributions paid in fully-vested interests in the Vertex common stock fund to the Vertex 401(k) Plan as follows: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
(in thousands) | ||||||||||||
Discretionary matching contributions during the year ended December 31, | $ | 5,930 | $ | 10,261 | $ | 8,619 | ||||||
Shares issued during the year ended December 31, | 99 | 242 | 183 | |||||||||
Shares issuable as of the year ended December 31, | 0 | 53 | 62 | |||||||||
Commitments_Tables
Commitments (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
Commitments | ' | ||||||||||||||||||||
Future minimum commitments under Fan Pier Leases and facilitiy operating leases with terms of more than one year, net of estimated sublease income | ' | ||||||||||||||||||||
As of December 31, 2013, future minimum commitments under the Fan Pier Leases, facility operating leases with terms of more than one year and contractual sublease income under the Company’s subleases for the Kendall Square Facility were as follows: | |||||||||||||||||||||
Year | Fan Pier | Kendall Square | Kendall Sublease | Other | Total Lease | ||||||||||||||||
Leases | Lease | Income | Operating | Commitments | |||||||||||||||||
Leases | (Net of Sublease Income) | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||
2014 | $ | 67,206 | $ | 19,879 | $ | (8,546 | ) | $ | 40,762 | $ | 119,301 | ||||||||||
2015 | 67,206 | 19,879 | (3,996 | ) | 33,398 | 116,487 | |||||||||||||||
2016 | 67,206 | 19,879 | — | 14,434 | 101,519 | ||||||||||||||||
2017 | 67,206 | 19,879 | — | 12,995 | 100,080 | ||||||||||||||||
2018 | 67,206 | 6,626 | — | 12,841 | 86,673 | ||||||||||||||||
Thereafter | 752,798 | — | — | 75,344 | 828,142 | ||||||||||||||||
Total minimum lease payments | $ | 1,088,828 | $ | 86,142 | $ | (12,542 | ) | $ | 189,774 | $ | 1,352,202 | ||||||||||
Schedule of future minimum lease payments for capital leases | ' | ||||||||||||||||||||
The following table sets forth the Company’s future minimum payments due under capital leases as of December 31, 2013: | |||||||||||||||||||||
Year | (in thousands) | ||||||||||||||||||||
2014 | $ | 19,957 | |||||||||||||||||||
2015 | 18,346 | ||||||||||||||||||||
2016 | 11,809 | ||||||||||||||||||||
2017 | 10,714 | ||||||||||||||||||||
2018 | 10,612 | ||||||||||||||||||||
Thereafter | 2,121 | ||||||||||||||||||||
Total payments | 73,559 | ||||||||||||||||||||
Less: amount representing interest | (7,912 | ) | |||||||||||||||||||
Present value of payments | $ | 65,647 | |||||||||||||||||||
Segment_Information_Tables
Segment Information (Tables) | 12 Months Ended | ||||||||||||||
Dec. 31, 2013 | |||||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||||
Revenues by Product | ' | ||||||||||||||
Product revenues, net consisted of the following: | |||||||||||||||
2013 | 2012 | 2011 | |||||||||||||
(in thousands) | |||||||||||||||
INCIVEK | $ | 466,360 | $ | 1,161,813 | $ | 950,889 | |||||||||
KALYDECO | 371,285 | 171,645 | — | ||||||||||||
Total product revenues, net | $ | 837,645 | $ | 1,333,458 | $ | 950,889 | |||||||||
Revenues and Property and Equipment by Location | ' | ||||||||||||||
Property and equipment, net by location consisted of the following: | |||||||||||||||
As of December 31, | |||||||||||||||
2013 | 2012 | ||||||||||||||
(in thousands) | |||||||||||||||
United States | $ | 657,587 | $ | 400,102 | |||||||||||
Outside of the United States | |||||||||||||||
United Kingdom | 29,970 | 30,622 | |||||||||||||
Other | 9,354 | 2,885 | |||||||||||||
Total property and equipment, net outside of the United States | 39,324 | 33,507 | |||||||||||||
Total property and equipment, net | $ | 696,911 | $ | 433,609 | |||||||||||
Total revenues from external customers and collaborators by geographic region consisted of the following. Product revenues are attributed to countries based on the location of the customer. Collaborative revenues are attributed to the operations of the Company in the United States. Royalty revenues are attributed to countries based on the location of the collaborator. | |||||||||||||||
2013 | 2012 | 2011 | |||||||||||||
(in thousands) | |||||||||||||||
United States | $ | 896,952 | $ | 1,373,516 | $ | 1,389,568 | |||||||||
Outside of the United States | |||||||||||||||
Europe | 279,557 | 129,786 | 20,289 | ||||||||||||
Other | 35,466 | 23,740 | 769 | ||||||||||||
Total revenues outside of the United States | 315,023 | 153,526 | 21,058 | ||||||||||||
Total revenues | $ | 1,211,975 | $ | 1,527,042 | $ | 1,410,626 | |||||||||
Significant Customers | ' | ||||||||||||||
Gross revenues and accounts receivable from each of the Company’s customers who individually accounted for 10% or more of total gross revenues and/or 10% or more of total gross accounts receivable consisted of the following: | |||||||||||||||
Percent of Total Gross Revenues | Percent of Gross Accounts Receivable | ||||||||||||||
Year Ended December 31, | As of December 31, | ||||||||||||||
2013 | 2012 | 2011 | 2013 | 2012 | |||||||||||
Janssen | 22 | % | <10 | % | 19 | % | 28 | % | 26 | % | |||||
AmerisourceBergen Drug Corporation | 21 | % | 32 | % | 25 | % | <10 | % | 22 | % | |||||
McKesson Corporation | 21 | % | 29 | % | 24 | % | <10 | % | 26 | % | |||||
Cardinal Health Incorporated | <10 | % | 15 | % | 15 | % | <10 | % | <10 | % | |||||
Bupa Home Healthcare Limited | <10 | % | N/A | N/A | 14 | % | N/A | ||||||||
Quarterly_Financial_Data_unaud1
Quarterly Financial Data (unaudited) (Tables) | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | |||||||||||||||
Schedule of quarterly financial data | ' | |||||||||||||||
Three Months Ended | ||||||||||||||||
March 31, | June 30, | September 30, | December 31, | |||||||||||||
2013 | 2013 | 2013 | 2013 | |||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||
Revenues: | ||||||||||||||||
Product revenues, net | $ | 267,381 | $ | 254,789 | $ | 186,653 | $ | 128,822 | ||||||||
Royalty revenues | 43,573 | 49,120 | 27,012 | 36,887 | ||||||||||||
Collaborative revenues (1) | 17,414 | 6,841 | 8,035 | 185,448 | ||||||||||||
Total revenues | 328,368 | 310,750 | 221,700 | 351,157 | ||||||||||||
Costs and expenses: | ||||||||||||||||
Cost of product revenues (2) | 30,955 | 24,695 | 20,048 | 13,281 | ||||||||||||
Royalty expenses | 11,788 | 13,236 | 7,291 | 8,983 | ||||||||||||
Research and development expenses | 218,095 | 222,455 | 228,624 | 249,609 | ||||||||||||
Sales, general and administrative expenses | 92,879 | 106,521 | 87,754 | 75,188 | ||||||||||||
Restructuring expenses | 39 | 776 | 12,048 | 27,658 | ||||||||||||
Intangible asset impairment charges (3)(4) | 412,900 | — | — | 250,600 | ||||||||||||
Total costs and expenses | 766,656 | 367,683 | 355,765 | 625,319 | ||||||||||||
Loss from operations | (438,288 | ) | (56,933 | ) | (134,065 | ) | (274,162 | ) | ||||||||
Interest expense, net | (3,465 | ) | (6,551 | ) | (95 | ) | (12,619 | ) | ||||||||
Other income (expense), net (4) | (1,187 | ) | (27 | ) | 4,747 | (53,472 | ) | |||||||||
Loss before benefit from income taxes | (442,940 | ) | (63,511 | ) | (129,413 | ) | (340,253 | ) | ||||||||
Benefit from income taxes (3)(4) | (130,313 | ) | (1,799 | ) | (751 | ) | (155,704 | ) | ||||||||
Net loss | (312,627 | ) | (61,712 | ) | (128,662 | ) | (184,549 | ) | ||||||||
Net loss attributable to noncontrolling interest (Alios) | 4,611 | 4,547 | 4,530 | 228,834 | ||||||||||||
Net income (loss) attributable to Vertex | $ | (308,016 | ) | $ | (57,165 | ) | $ | (124,132 | ) | $ | 44,285 | |||||
Net income (loss) per share attributable to Vertex common shareholders: | ||||||||||||||||
Basic | $ | (1.43 | ) | $ | (0.26 | ) | $ | (0.54 | ) | $ | 0.19 | |||||
Diluted | $ | (1.43 | ) | $ | (0.26 | ) | $ | (0.54 | ) | $ | 0.19 | |||||
Shares used in per share calculations: | ||||||||||||||||
Basic | 215,421 | 222,053 | 230,505 | 231,264 | ||||||||||||
Diluted | 215,421 | 222,053 | 230,505 | 235,717 | ||||||||||||
Three Months Ended | ||||||||||||||||
March 31, | June 30, | September 30, | December 31, | |||||||||||||
2012 | 2012 | 2012 | 2012 | |||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||
Revenues: | ||||||||||||||||
Product revenues, net | $ | 375,375 | $ | 373,273 | $ | 303,501 | $ | 281,309 | ||||||||
Royalty revenues | 38,981 | 33,480 | 25,586 | 43,451 | ||||||||||||
Collaborative revenues | 24,381 | 11,552 | 6,919 | 9,234 | ||||||||||||
Total revenues | 438,737 | 418,305 | 336,006 | 333,994 | ||||||||||||
Costs and expenses: | ||||||||||||||||
Cost of product revenues (2) | 25,918 | 104,549 | 30,680 | 75,595 | ||||||||||||
Royalty expenses | 13,293 | 9,874 | 7,856 | 12,120 | ||||||||||||
Research and development expenses | 196,371 | 196,544 | 200,161 | 213,109 | ||||||||||||
Sales, general and administrative expenses | 111,146 | 117,514 | 97,684 | 110,452 | ||||||||||||
Restructuring expenses | 360 | 594 | 696 | 194 | ||||||||||||
Intangible asset impairment charge | — | — | — | — | ||||||||||||
Total costs and expenses | 347,088 | 429,075 | 337,077 | 411,470 | ||||||||||||
Income (loss) from operations | 91,649 | (10,770 | ) | (1,071 | ) | (77,476 | ) | |||||||||
Interest expense, net | (3,891 | ) | (3,814 | ) | (4,054 | ) | (3,263 | ) | ||||||||
Other income (expense), net | 150 | 179 | 13 | (33 | ) | |||||||||||
Income (loss) before provision for (benefit from) income taxes | 87,908 | (14,405 | ) | (5,112 | ) | (80,772 | ) | |||||||||
Provision for (benefit from) income taxes | 32 | 20,063 | 21,355 | (2,696 | ) | |||||||||||
Net income (loss) | 87,876 | (34,468 | ) | (26,467 | ) | (78,076 | ) | |||||||||
Net loss (income) attributable to noncontrolling interest (Alios) | 3,714 | (30,463 | ) | (31,076 | ) | 1,928 | ||||||||||
Net income (loss) attributable to Vertex | $ | 91,590 | $ | (64,931 | ) | $ | (57,543 | ) | $ | (76,148 | ) | |||||
Net income (loss) per share attributable to Vertex common shareholders: | ||||||||||||||||
Basic | $ | 0.44 | $ | (0.31 | ) | $ | (0.27 | ) | $ | (0.35 | ) | |||||
Diluted | $ | 0.43 | $ | (0.31 | ) | $ | (0.27 | ) | $ | (0.35 | ) | |||||
Shares used in per share calculations: | ||||||||||||||||
Basic | 208,018 | 211,344 | 213,767 | 214,607 | ||||||||||||
Diluted | 219,264 | 211,344 | 213,767 | 214,607 | ||||||||||||
1 | During the fourth quarter of 2013, the Company recorded $182.4 million of collaborative revenue related to its Janssen collaboration, which was primarily attributable to an amendment to its collaboration agreement with Janssen. See Note B, "Collaborative Arrangements," for further information. | |||||||||||||||
2 | During 2013 and 2012, the Company recorded within cost of product revenues lower-of-cost or market charges for excess or obsolete inventories. See Note G, "Inventories," for further information. | |||||||||||||||
3 | During the first quarter of 2013, the Company recorded a $412.9 million intangible asset impairment charge related to its VX-222 indefinite-lived in-process research and development asset. In connection with this impairment charge, the Company recorded a credit of $127.6 million in its provision for income taxes. See Note J, "Intangible Assets and Goodwill," for further information. | |||||||||||||||
4 | During the fourth quarter of 2013, the Company deconsolidated Alios, which included certain charges related to deconsolidation recorded in other income (expense), net, and was preceded by a $250.6 million intangible asset impairment charge related to the HCV nucleotide analogue program indefinite-lived in-process research and development asset. In connection with this impairment charge, a credit of $102.1 million was recorded to the provision for income taxes attributable to Alios. See Note B, "Collaborative Arrangements," and Note J, "Intangible Assets and Goodwill," for further information. |
Nature_of_Business_and_Account3
Nature of Business and Accounting Policies (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
product | |||||||||||
Product revenues allowances and reserve categories | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gross product sales adjusted, related to prior period sales (percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.70% | 1.30% |
Number of products (products) | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' |
Net income (loss) attributable to Vertex common shareholders | $44,285,000 | ($124,132,000) | ($57,165,000) | ($308,016,000) | ($76,148,000) | ($57,543,000) | ($64,931,000) | $91,590,000 | ($445,028,000) | ($107,032,000) | $29,574,000 |
Basic EPS (usd per share) | ($0.19) | $0.54 | $0.26 | $1.43 | $0.35 | $0.27 | $0.31 | ($0.44) | $1.98 | $0.50 | ($0.14) |
Cash, cash equivalents and marketable securities | 1,470,000,000 | ' | ' | ' | ' | ' | ' | ' | 1,470,000,000 | ' | ' |
Product revenues, net | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Discount rate for payments made within 30 days (percent) | ' | ' | ' | ' | ' | ' | ' | ' | 2.00% | ' | ' |
Activity related to product revenues allowances and reserve categories | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Beginning Balance | ' | ' | ' | 75,393,000 | ' | ' | ' | 69,363,000 | 75,393,000 | 69,363,000 | 0 |
Provision related to current period sales | ' | ' | ' | ' | ' | ' | ' | ' | 250,944,000 | 294,025,000 | 123,618,000 |
Adjustments related to prior period sales | ' | ' | ' | ' | ' | ' | ' | ' | 19,738,000 | 5,482,000 | ' |
Credits/payments made | ' | ' | ' | ' | ' | ' | ' | ' | -258,942,000 | -293,477,000 | -54,255,000 |
Ending Balance | 87,133,000 | ' | ' | ' | 75,393,000 | ' | ' | ' | 87,133,000 | 75,393,000 | 69,363,000 |
Trade Allowances | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Activity related to product revenues allowances and reserve categories | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Beginning Balance | ' | ' | ' | 5,416,000 | ' | ' | ' | 11,162,000 | 5,416,000 | 11,162,000 | 0 |
Provision related to current period sales | ' | ' | ' | ' | ' | ' | ' | ' | 31,395,000 | 55,913,000 | 38,228,000 |
Adjustments related to prior period sales | ' | ' | ' | ' | ' | ' | ' | ' | 343,000 | 29,000 | ' |
Credits/payments made | ' | ' | ' | ' | ' | ' | ' | ' | -35,619,000 | -61,688,000 | -27,066,000 |
Ending Balance | 1,535,000 | ' | ' | ' | 5,416,000 | ' | ' | ' | 1,535,000 | 5,416,000 | 11,162,000 |
Rebates, Chargebacks and Discounts | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Activity related to product revenues allowances and reserve categories | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Beginning Balance | ' | ' | ' | 63,560,000 | ' | ' | ' | 52,659,000 | 63,560,000 | 52,659,000 | 0 |
Provision related to current period sales | ' | ' | ' | ' | ' | ' | ' | ' | 204,459,000 | 216,942,000 | 75,145,000 |
Adjustments related to prior period sales | ' | ' | ' | ' | ' | ' | ' | ' | 4,474,000 | 3,883,000 | ' |
Credits/payments made | ' | ' | ' | ' | ' | ' | ' | ' | -204,249,000 | -209,924,000 | -22,486,000 |
Ending Balance | 68,244,000 | ' | ' | ' | 63,560,000 | ' | ' | ' | 68,244,000 | 63,560,000 | 52,659,000 |
Product Returns | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Activity related to product revenues allowances and reserve categories | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Beginning Balance | ' | ' | ' | 2,852,000 | ' | ' | ' | 340,000 | 2,852,000 | 340,000 | 0 |
Provision related to current period sales | ' | ' | ' | ' | ' | ' | ' | ' | 5,795,000 | 2,067,000 | 553,000 |
Adjustments related to prior period sales | ' | ' | ' | ' | ' | ' | ' | ' | 15,149,000 | 1,498,000 | ' |
Credits/payments made | ' | ' | ' | ' | ' | ' | ' | ' | -7,997,000 | -1,053,000 | -213,000 |
Ending Balance | 15,799,000 | ' | ' | ' | 2,852,000 | ' | ' | ' | 15,799,000 | 2,852,000 | 340,000 |
Other Incentives | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Activity related to product revenues allowances and reserve categories | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Beginning Balance | ' | ' | ' | 3,565,000 | ' | ' | ' | 5,202,000 | 3,565,000 | 5,202,000 | 0 |
Provision related to current period sales | ' | ' | ' | ' | ' | ' | ' | ' | 9,295,000 | 19,103,000 | 9,692,000 |
Adjustments related to prior period sales | ' | ' | ' | ' | ' | ' | ' | ' | -228,000 | 72,000 | ' |
Credits/payments made | ' | ' | ' | ' | ' | ' | ' | ' | -11,077,000 | -20,812,000 | -4,490,000 |
Ending Balance | $1,555,000 | ' | ' | ' | $3,565,000 | ' | ' | ' | $1,555,000 | $3,565,000 | $5,202,000 |
Nature_of_Business_and_Account4
Nature of Business and Accounting Policies (Details 2) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Sales, General and Administrative Expenses | ' | ' | ' |
Advertising Expenses | $19.60 | $58.60 | $30.80 |
Nature_of_Business_and_Account5
Nature of Business and Accounting Policies (Details 3) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Foreign Currency Translation | ' | ' | ' |
Foreign currency translation adjustment, net of tax | ($0.30) | ($0.70) | ($0.90) |
Foreign currency transaction gain (loss), before tax | $5.10 | ($0.40) | $0.70 |
Building | ' | ' | ' |
Property and Equipment | ' | ' | ' |
Property and equipment useful life | '40 years | ' | ' |
Minimum | Furniture and equipment | ' | ' | ' |
Property and Equipment | ' | ' | ' |
Property and equipment useful life | '7 years | ' | ' |
Minimum | Computers and software | ' | ' | ' |
Property and Equipment | ' | ' | ' |
Property and equipment useful life | '3 years | ' | ' |
Maximum | Furniture and equipment | ' | ' | ' |
Property and Equipment | ' | ' | ' |
Property and equipment useful life | '10 years | ' | ' |
Maximum | Computers and software | ' | ' | ' |
Property and Equipment | ' | ' | ' |
Property and equipment useful life | '5 years | ' | ' |
Collaborative_Arrangements_Det
Collaborative Arrangements (Details) (USD $) | 3 Months Ended | 12 Months Ended | 3 Months Ended | 12 Months Ended | 3 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 3 Months Ended | 12 Months Ended | |||||||||||||||||||||||||
Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Sep. 30, 2011 | Mar. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2006 | Dec. 31, 2011 | Sep. 30, 2009 | Dec. 31, 2012 | Dec. 31, 2011 | Apr. 30, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2006 | Jun. 30, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | |||||
Janssen | Janssen | Janssen | Janssen | Janssen | Janssen | Janssen | Bupa Home Healthcare Limited | Bupa Home Healthcare Limited | Bupa Home Healthcare Limited | Bupa Home Healthcare Limited | Cystic Fibrosis Foundation Therapeutics Incorporated | Cystic Fibrosis Foundation Therapeutics Incorporated | Cystic Fibrosis Foundation Therapeutics Incorporated | Cystic Fibrosis Foundation Therapeutics Incorporated | Cystic Fibrosis Foundation Therapeutics Incorporated | Alios BioPharma, Inc | Alios BioPharma, Inc | Alios BioPharma, Inc | Alios BioPharma, Inc | Research and Development Arrangement | Research and Development Arrangement | ||||||||||||||||
payment | lines | Alios BioPharma, Inc | Alios BioPharma, Inc | ||||||||||||||||||||||||||||||||||
Schedule of Collaborative Arrangements | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Drug development costs to be paid by collaborator (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Tiered royalty average range, as a percentage of net sales in the Janssen territories | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Up-front license payment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $165,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Deferred revenue related to up-front license payment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,000,000 | ' | ' | 5,000,000 | 32,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Total contingent milestone payments earned | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 350,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Milestone payment earned pursuant to the collaborative agreement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 200,000,000 | 50,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Royalty revenues | 36,887,000 | 27,012,000 | 49,120,000 | 43,573,000 | 43,451,000 | 25,586,000 | 33,480,000 | 38,981,000 | 156,592,000 | 141,498,000 | 50,015,000 | ' | ' | ' | 130,724,000 | 117,592,000 | 20,289,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Collaborative revenues: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Up-front and amendment payments revenues | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 190,345,000 | 12,428,000 | 12,428,000 | ' | ' | ' | 12,744,000 | 38,232,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Milestone revenues | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | 250,000,000 | ' | ' | ' | 485,000 | 68,515,000 | ' | 9,300,000 | ' | ' | ' | ' | 60,000,000 | ' | ' | ' | ' | ||||
Net reimbursement (payment) for telaprevir development costs | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,793,000 | -3,507,000 | -8,418,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Reimbursement for manufacturing services | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,299,000 | 7,257,000 | 20,383,000 | ' | ' | ' | 5,650,000 | 14,928,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Collaborative revenues | 185,448,000 | 8,035,000 | 6,841,000 | 17,414,000 | 9,234,000 | 6,919,000 | 11,552,000 | 24,381,000 | 217,738,000 | 52,086,000 | 409,722,000 | 182,400,000 | ' | ' | 203,437,000 | 16,178,000 | 274,393,000 | ' | ' | ' | 18,879,000 | 121,675,000 | ' | 14,300,000 | 17,000,000 | 13,700,000 | ' | ' | ' | ' | ' | ' | ' | ||||
Total revenues | 351,157,000 | 221,700,000 | 310,750,000 | 328,368,000 | 333,994,000 | 336,006,000 | 418,305,000 | 438,737,000 | 1,211,975,000 | 1,527,042,000 | 1,410,626,000 | ' | ' | ' | 334,161,000 | 133,770,000 | 294,682,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
License fee paid upon amendment of agreement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 152,000,000 | ' | ' | ' | ' | ' | ' | ' | 105,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Milestone payment received | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 65,000,000 | ' | ' | ' | ' | ' | ' | ' | 1,500,000 | ' | ' | ' | ' | ' | ' | ||||
Deferred revenue related to up-front license payment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,000,000 | ' | ' | 5,000,000 | 32,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Collaborative funding | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 75,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Number of years over which funding will be made (in years) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Number of commercial milestone payments for achievement of certain sales levels for corrector compound such as VX-809 or VX-661 (in payments) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Up-front payment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 60,000,000 | ' | ' | ' | ' | ' | ||||
Milestone payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | 250,000,000 | ' | ' | ' | 485,000 | 68,515,000 | ' | 9,300,000 | ' | ' | ' | ' | 60,000,000 | ' | ' | ' | ' | ||||
Development milestone payments, maximum | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 312,500,000 | ' | ' | ' | ' | ||||
Commercial milestone payments, maximum | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 750,000,000 | ' | ' | ' | ' | ' | ||||
Notice period for termination of contract due to technical failure (in days) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '30 days | ' | ' | ' | ' | ' | ||||
Notice period for termination of contract after completion of clinical trials (in days) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '60 days | ' | ' | ' | ' | ' | ||||
Latest expiration period for royalty obligation after first commercial sale in country unless contract is terminated earlier (in years) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '10 years | ' | ' | ' | ' | ' | ||||
Intangible asset impairment charges | 250,600,000 | 0 | 0 | 412,900,000 | 0 | 0 | 0 | 0 | 663,500,000 | 0 | 105,800,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 250,600,000 | 250,600,000 | ||||
Change in deferred income taxes | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 102,100,000 | ||||
Deconsolidation, Gain (Loss), Amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 68,200,000 | ||||
Collaborative Arrangements, Upfront License Fees and Milestone Payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 120,000,000 | ||||
Noncontrolling Interest (Alios) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Number of lines on balance sheet where noncontrolling interest is reported (lines) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' | ' | ||||
Loss before provision for (benefit from) income taxes | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 283,747,000 | 20,044,000 | 9,536,000 | ' | ' | ||||
Decrease (increase) in fair value of contingent milestone and royalty payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 124,920,000 | -114,970,000 | -69,950,000 | ' | ' | ||||
Provision for (benefit from) income taxes | -155,704,000 | -751,000 | -1,799,000 | -130,313,000 | -2,696,000 | 21,355,000 | 20,063,000 | 32,000 | -288,567,000 | 38,754,000 | 19,266,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -166,145,000 | 39,029,000 | 48,809,000 | ' | ' | ||||
Net loss (income) attributable to noncontrolling interest (Alios) | -228,834,000 | -4,530,000 | -4,547,000 | -4,611,000 | -1,928,000 | 31,076,000 | 30,463,000 | -3,714,000 | -242,522,000 | 55,897,000 | 11,605,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 242,522,000 | -55,897,000 | -11,605,000 | ' | ' | ||||
Restricted cash and cash equivalents (Alios) | 0 | [1] | ' | ' | ' | 69,983,000 | [1] | ' | ' | ' | 0 | [1] | 69,983,000 | [1] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 69,983,000 | ' | ' | ' |
Prepaid expenses and other current assets | 23,836,000 | [1] | ' | ' | ' | 24,673,000 | [1] | ' | ' | ' | 23,836,000 | [1] | 24,673,000 | [1] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 672,000 | ' | ' | ' |
Property and equipment, net | 696,911,000 | [1] | ' | ' | ' | 433,609,000 | [1] | ' | ' | ' | 696,911,000 | [1] | 433,609,000 | [1] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,728,000 | ' | ' | ' |
Intangible assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 250,600,000 | 250,600,000 | ' | ' | ||||
Other assets | 2,432,000 | [1] | ' | ' | ' | 9,668,000 | [1] | ' | ' | ' | 2,432,000 | [1] | 9,668,000 | [1] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 861,000 | ' | ' | ' |
Accounts payable | 49,327,000 | [1] | ' | ' | ' | 101,292,000 | [1] | ' | ' | ' | 49,327,000 | [1] | 101,292,000 | [1] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,054,000 | ' | ' | ' |
Accrued expenses | 271,077,000 | [1] | ' | ' | ' | 264,884,000 | [1] | ' | ' | ' | 271,077,000 | [1] | 264,884,000 | [1] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,099,000 | ' | ' | ' |
Income taxes payable (Alios) | 0 | [1] | ' | ' | ' | 715,000 | [1] | ' | ' | ' | 0 | [1] | 715,000 | [1] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 715,000 | ' | ' | ' |
Deferred tax liability | 0 | [1] | ' | ' | ' | 280,367,000 | [1] | ' | ' | ' | 0 | [1] | 280,367,000 | [1] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 152,781,000 | ' | ' | ' |
Other liabilities, excluding current portion | 11,590,000 | [1] | ' | ' | ' | 13,902,000 | [1] | ' | ' | ' | 11,590,000 | [1] | 13,902,000 | [1] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 910,000 | ' | ' | ' |
Redeemable noncontrolling interest (Alios) | 0 | [1] | ' | ' | ' | 38,530,000 | [1] | ' | ' | ' | 0 | [1] | 38,530,000 | [1] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 38,530,000 | ' | ' | ' |
Noncontrolling interest (Alios) | 0 | [1] | ' | ' | ' | 196,672,000 | [1] | ' | ' | ' | 0 | [1] | 196,672,000 | [1] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 196,672,000 | ' | ' | ' |
Collaborative revenues | $185,448,000 | $8,035,000 | $6,841,000 | $17,414,000 | $9,234,000 | $6,919,000 | $11,552,000 | $24,381,000 | $217,738,000 | $52,086,000 | $409,722,000 | $182,400,000 | ' | ' | $203,437,000 | $16,178,000 | $274,393,000 | ' | ' | ' | $18,879,000 | $121,675,000 | ' | $14,300,000 | $17,000,000 | $13,700,000 | ' | ' | ' | ' | ' | ' | ' | ||||
[1] | Amounts as of December 31, 2012 include the assets and liabilities of Vertex’s variable interest entity (“VIEâ€), Alios BioPharma, Inc. (“Aliosâ€). The Company deconsolidated Alios as of December 31, 2013. Vertex’s interests and obligations with respect to the VIE’s assets and liabilities are limited to those accorded to Vertex in its agreement with Alios. See Note B, "Collaborative Arrangements," to these consolidated financial statements for amounts. |
Net_Income_Loss_Per_Share_Attr2
Net Income (Loss) Per Share Attributable to Vertex Common Shareholders (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Basic net income (loss) attributable to Vertex per common share calculation: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) attributable to Vertex common shareholders | $44,285 | ($124,132) | ($57,165) | ($308,016) | ($76,148) | ($57,543) | ($64,931) | $91,590 | ($445,028) | ($107,032) | $29,574 |
Less: Undistributed earnings allocated to participating securities | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | -291 |
Net income (loss) attributable to Vertex common shareholders—basic | ' | ' | ' | ' | ' | ' | ' | ' | -445,028 | -107,032 | 29,283 |
Weighted-average shares used to compute basic net income (loss) per common share (shares) | 231,264 | 230,505 | 222,053 | 215,421 | 214,607 | 213,767 | 211,344 | 208,018 | 224,906 | 211,946 | 204,891 |
Basic net income (loss) attributable to Vertex per common share (usd per share) | $0.19 | ($0.54) | ($0.26) | ($1.43) | ($0.35) | ($0.27) | ($0.31) | $0.44 | ($1.98) | ($0.50) | $0.14 |
Diluted net income (loss) attributable to Vertex per common share calculation: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) attributable to Vertex common shareholders | 44,285 | -124,132 | -57,165 | -308,016 | -76,148 | -57,543 | -64,931 | 91,590 | -445,028 | -107,032 | 29,574 |
Less: Undistributed earnings allocated to participating securities | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | -285 |
Net income (loss) attributable to Vertex common shareholders—diluted | ' | ' | ' | ' | ' | ' | ' | ' | ($445,028) | ($107,032) | $29,289 |
Weighted-average shares used to compute basic net income (loss) per common share (shares) | 231,264 | 230,505 | 222,053 | 215,421 | 214,607 | 213,767 | 211,344 | 208,018 | 224,906 | 211,946 | 204,891 |
Effect of potentially dilutive securities: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock options (shares) | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | 3,863 |
Other (shares) | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | 53 |
Weighted-average shares used to compute diluted net income (loss) per common share (shares) | 235,717 | 230,505 | 222,053 | 215,421 | 214,607 | 213,767 | 211,344 | 219,264 | 224,906 | 211,946 | 208,807 |
Diluted net income (loss) attributable to Vertex per common share (usd per share) | $0.19 | ($0.54) | ($0.26) | ($1.43) | ($0.35) | ($0.27) | ($0.31) | $0.43 | ($1.98) | ($0.50) | $0.14 |
Stock options | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Effect of potentially dilutive securities: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Antidilutive securities excluded from computation of earnings per share (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | 15,729 | 19,726 | 9,626 |
Convertible senior subordinated notes | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Effect of potentially dilutive securities: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Antidilutive securities excluded from computation of earnings per share (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 8,192 | 8,192 |
Unvested restricted stock and restricted stock units | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Effect of potentially dilutive securities: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Antidilutive securities excluded from computation of earnings per share (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | 2,165 | 2,350 | 8 |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) (Recurring basis, USD $) | Dec. 31, 2013 |
In Thousands, unless otherwise specified | |
Total | ' |
Financial assets carried at fair value: | ' |
Total | $1,151,466 |
Total | Money market funds | ' |
Financial assets carried at fair value: | ' |
Cash equivalents: | 255,689 |
Total | Government-sponsored enterprise securities | ' |
Financial assets carried at fair value: | ' |
Marketable securities: | 600,450 |
Total | Commercial paper | ' |
Financial assets carried at fair value: | ' |
Marketable securities: | 83,493 |
Total | Corporate debt securities | ' |
Financial assets carried at fair value: | ' |
Marketable securities: | 211,834 |
Level 1 | ' |
Financial assets carried at fair value: | ' |
Total | 856,139 |
Level 1 | Money market funds | ' |
Financial assets carried at fair value: | ' |
Cash equivalents: | 255,689 |
Level 1 | Government-sponsored enterprise securities | ' |
Financial assets carried at fair value: | ' |
Marketable securities: | 600,450 |
Level 1 | Commercial paper | ' |
Financial assets carried at fair value: | ' |
Marketable securities: | 0 |
Level 1 | Corporate debt securities | ' |
Financial assets carried at fair value: | ' |
Marketable securities: | 0 |
Level 2 | ' |
Financial assets carried at fair value: | ' |
Total | 295,327 |
Level 2 | Money market funds | ' |
Financial assets carried at fair value: | ' |
Cash equivalents: | 0 |
Level 2 | Government-sponsored enterprise securities | ' |
Financial assets carried at fair value: | ' |
Marketable securities: | 0 |
Level 2 | Commercial paper | ' |
Financial assets carried at fair value: | ' |
Marketable securities: | 83,493 |
Level 2 | Corporate debt securities | ' |
Financial assets carried at fair value: | ' |
Marketable securities: | 211,834 |
Level 3 | ' |
Financial assets carried at fair value: | ' |
Total | 0 |
Level 3 | Money market funds | ' |
Financial assets carried at fair value: | ' |
Cash equivalents: | 0 |
Level 3 | Government-sponsored enterprise securities | ' |
Financial assets carried at fair value: | ' |
Marketable securities: | 0 |
Level 3 | Commercial paper | ' |
Financial assets carried at fair value: | ' |
Marketable securities: | 0 |
Level 3 | Corporate debt securities | ' |
Financial assets carried at fair value: | ' |
Marketable securities: | $0 |
Marketable_Securities_Details
Marketable Securities (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Summary of cash, cash equivalents and marketable securities | ' | ' |
Amortized Cost | $1,465,034 | $1,321,019 |
Gross Unrealized Gains | 136 | 217 |
Gross Unrealized Losses | -94 | -21 |
Fair Value | 1,465,076 | 1,321,215 |
Total cash and cash equivalents | ' | ' |
Summary of cash, cash equivalents and marketable securities | ' | ' |
Amortized Cost | 569,299 | 489,407 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 569,299 | 489,407 |
Cash and money market funds | ' | ' |
Summary of cash, cash equivalents and marketable securities | ' | ' |
Amortized Cost | 569,299 | 489,407 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 569,299 | 489,407 |
Total marketable securities | ' | ' |
Summary of cash, cash equivalents and marketable securities | ' | ' |
Amortized Cost | 895,735 | 831,612 |
Gross Unrealized Gains | 136 | 217 |
Gross Unrealized Losses | -94 | -21 |
Fair Value | 895,777 | 831,808 |
U.S. Treasury securities | ' | ' |
Summary of cash, cash equivalents and marketable securities | ' | ' |
Amortized Cost | ' | 111,350 |
Gross Unrealized Gains | ' | 2 |
Gross Unrealized Losses | ' | -2 |
Fair Value | ' | 111,350 |
Government-sponsored enterprise securities | ' | ' |
Summary of cash, cash equivalents and marketable securities | ' | ' |
Amortized Cost | 600,496 | 440,181 |
Gross Unrealized Gains | 7 | 49 |
Gross Unrealized Losses | -53 | -5 |
Fair Value | 600,450 | 440,225 |
Commercial paper (due within 1 year) | ' | ' |
Summary of cash, cash equivalents and marketable securities | ' | ' |
Amortized Cost | 83,384 | 225,294 |
Gross Unrealized Gains | 109 | 155 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 83,493 | 225,449 |
Corporate debt securities (due within 1 year) | ' | ' |
Summary of cash, cash equivalents and marketable securities | ' | ' |
Amortized Cost | 189,674 | 15,429 |
Gross Unrealized Gains | 14 | 1 |
Gross Unrealized Losses | -34 | -1 |
Fair Value | 189,654 | 15,429 |
Corporate debt securities (due after 1 year through 5 years) | ' | ' |
Summary of cash, cash equivalents and marketable securities | ' | ' |
Amortized Cost | 22,181 | 39,358 |
Gross Unrealized Gains | 6 | 10 |
Gross Unrealized Losses | -7 | -13 |
Fair Value | $22,180 | $39,355 |
Marketable_Securities_Details_
Marketable Securities (Details 2) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Cash equivalents (Alios) | $0 | [1] | $69,983,000 | [1] |
Alios BioPharma, Inc | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Cash equivalents (Alios) | ' | 70,000,000 | [1] | |
Foreign currency forward contract | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Derivative, Notional Amount | $17,500,000 | ' | ||
[1] | Amounts as of December 31, 2012 include the assets and liabilities of Vertex’s variable interest entity (“VIEâ€), Alios BioPharma, Inc. (“Aliosâ€). The Company deconsolidated Alios as of December 31, 2013. Vertex’s interests and obligations with respect to the VIE’s assets and liabilities are limited to those accorded to Vertex in its agreement with Alios. See Note B, "Collaborative Arrangements," to these consolidated financial statements for amounts. |
Accumulated_Other_Comprehensiv2
Accumulated Other Comprehensive Loss (Details) (USD $) | 12 Months Ended | ||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' | ' | ||
Balance at December 31, 2012 | ($550) | [1] | ' | ' | |
Other comprehensive income (loss) before reclassifications | 244 | ' | ' | ||
Amounts reclassified from accumulated other comprehensive loss | 0 | ' | ' | ||
Net current period other comprehensive income (loss) | 244 | 503 | 14 | ||
Balance at December 31, 2013 | -306 | [1] | -550 | [1] | ' |
Foreign currency translation adjustment | ' | ' | ' | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' | ' | ||
Balance at December 31, 2012 | -746 | ' | ' | ||
Other comprehensive income (loss) before reclassifications | 421 | ' | ' | ||
Amounts reclassified from accumulated other comprehensive loss | 0 | ' | ' | ||
Net current period other comprehensive income (loss) | 421 | ' | ' | ||
Balance at December 31, 2013 | -325 | ' | ' | ||
Unrealized holding gains on marketable securities | ' | ' | ' | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' | ' | ||
Balance at December 31, 2012 | 196 | ' | ' | ||
Other comprehensive income (loss) before reclassifications | -154 | ' | ' | ||
Amounts reclassified from accumulated other comprehensive loss | 0 | ' | ' | ||
Net current period other comprehensive income (loss) | -154 | ' | ' | ||
Balance at December 31, 2013 | 42 | ' | ' | ||
Unrealized losses on foreign currency forward contracts | ' | ' | ' | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' | ' | ||
Balance at December 31, 2012 | 0 | ' | ' | ||
Other comprehensive income (loss) before reclassifications | -23 | ' | ' | ||
Amounts reclassified from accumulated other comprehensive loss | 0 | ' | ' | ||
Net current period other comprehensive income (loss) | -23 | ' | ' | ||
Balance at December 31, 2013 | ($23) | ' | ' | ||
[1] | Amounts as of December 31, 2012 include the assets and liabilities of Vertex’s variable interest entity (“VIEâ€), Alios BioPharma, Inc. (“Aliosâ€). The Company deconsolidated Alios as of December 31, 2013. Vertex’s interests and obligations with respect to the VIE’s assets and liabilities are limited to those accorded to Vertex in its agreement with Alios. See Note B, "Collaborative Arrangements," to these consolidated financial statements for amounts. |
Inventories_Inventories_Schedu
Inventories Inventories- Schedule of Inventories (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | ||
In Thousands, unless otherwise specified | ||||
Inventory Disclosure [Abstract] | ' | ' | ||
Raw materials | $489 | $3,754 | ||
Work-in-process | 9,981 | 11,317 | ||
Finished goods | 3,677 | 15,393 | ||
Total | $14,147 | [1] | $30,464 | [1] |
[1] | Amounts as of December 31, 2012 include the assets and liabilities of Vertex’s variable interest entity (“VIEâ€), Alios BioPharma, Inc. (“Aliosâ€). The Company deconsolidated Alios as of December 31, 2013. Vertex’s interests and obligations with respect to the VIE’s assets and liabilities are limited to those accorded to Vertex in its agreement with Alios. See Note B, "Collaborative Arrangements," to these consolidated financial statements for amounts. |
InventoriesBy_Product_Details
Inventories-By Product (Details) (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Inventory Disclosure [Abstract] | ' | ' | ' |
Write-downs of inventories to net realizable value | $10,358 | $133,189 | $0 |
Write-down of inventories effect on net income (loss) per share (usd per share) | ($0.05) | ($0.61) | ' |
Property_and_Equipment_Details
Property and Equipment (Details) (USD $) | 12 Months Ended | ||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |||
Property and Equipment | ' | ' | ' | ||
Total property and equipment, gross | $1,005,246,000 | $730,294,000 | ' | ||
Less: accumulated depreciation | -308,335,000 | -296,685,000 | ' | ||
Total property and equipment, net | 696,911,000 | [1] | 433,609,000 | [1] | ' |
Capital leased assets, gross | 76,400,000 | 30,100,000 | ' | ||
Capital leases accumulated depreciation | 3,800,000 | 1,100,000 | ' | ||
Depreciation and amortization expense | 47,300,000 | 35,700,000 | 28,900,000 | ||
Building | ' | ' | ' | ||
Property and Equipment | ' | ' | ' | ||
Total property and equipment, gross | 506,056,000 | 0 | ' | ||
Furniture and equipment | ' | ' | ' | ||
Property and Equipment | ' | ' | ' | ||
Total property and equipment, gross | 190,555,000 | 173,766,000 | ' | ||
Leasehold improvements | ' | ' | ' | ||
Property and Equipment | ' | ' | ' | ||
Total property and equipment, gross | 163,019,000 | 123,770,000 | ' | ||
Software | ' | ' | ' | ||
Property and Equipment | ' | ' | ' | ||
Total property and equipment, gross | 102,520,000 | 101,276,000 | ' | ||
Less: accumulated depreciation | -500,000 | ' | ' | ||
Total property and equipment, net | 5,500,000 | ' | ' | ||
Computers | ' | ' | ' | ||
Property and Equipment | ' | ' | ' | ||
Total property and equipment, gross | 43,096,000 | 40,779,000 | ' | ||
Construction-in-process | ' | ' | ' | ||
Property and Equipment | ' | ' | ' | ||
Total property and equipment, gross | 0 | 290,703,000 | ' | ||
Total property and equipment, net | $506,100,000 | $290,700,000 | ' | ||
[1] | Amounts as of December 31, 2012 include the assets and liabilities of Vertex’s variable interest entity (“VIEâ€), Alios BioPharma, Inc. (“Aliosâ€). The Company deconsolidated Alios as of December 31, 2013. Vertex’s interests and obligations with respect to the VIE’s assets and liabilities are limited to those accorded to Vertex in its agreement with Alios. See Note B, "Collaborative Arrangements," to these consolidated financial statements for amounts. |
Fan_Pier_Leases_Details
Fan Pier Leases (Details) (USD $) | 12 Months Ended | ||||
In Thousands, unless otherwise specified | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | ||
building | |||||
squarefeet | |||||
leases | |||||
Property and Equipment | ' | ' | ' | ||
Number of leases (leases) | 2 | ' | ' | ||
Area of leased property (in square feet) | 1,100,000 | ' | ' | ||
Number of buildings under lease agreement (buildings) | 2 | ' | ' | ||
Property and equipment, net | ' | $696,911 | [1] | $433,609 | [1] |
Construction financing lease obligation | ' | 440,937 | [1] | 268,031 | [1] |
Construction costs for Buildings at Gan Pier | ' | ' | ' | ||
Property and Equipment | ' | ' | ' | ||
Property and equipment, net | ' | $506,100 | $290,700 | ||
Kendall Square Lease | ' | ' | ' | ||
Property and Equipment | ' | ' | ' | ||
Optional term of lease agreement (in years) | '10 years | ' | ' | ||
[1] | Amounts as of December 31, 2012 include the assets and liabilities of Vertex’s variable interest entity (“VIEâ€), Alios BioPharma, Inc. (“Aliosâ€). The Company deconsolidated Alios as of December 31, 2013. Vertex’s interests and obligations with respect to the VIE’s assets and liabilities are limited to those accorded to Vertex in its agreement with Alios. See Note B, "Collaborative Arrangements," to these consolidated financial statements for amounts. |
Intangible_Assets_and_Goodwill1
Intangible Assets and Goodwill (Details) (USD $) | 3 Months Ended | 12 Months Ended | 12 Months Ended | 3 Months Ended | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2011 | Sep. 30, 2011 | Dec. 31, 2010 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |||||
VX-222Asset | VX-222Asset | VX-222Asset | Research and Development Arrangement | Research and Development Arrangement | Research and Development Arrangement | Research and Development Arrangement | Research and Development Arrangement | Alios Bio Pharma Inc | Alios Bio Pharma Inc | Alios Bio Pharma Inc | Alios Bio Pharma Inc | Alios Bio Pharma Inc | Alios Bio Pharma Inc | ||||||||||||||||
VX-222Asset | VX-222Asset | VX759Asset [Member] | VX759Asset [Member] | VX759Asset [Member] | Research and Development Arrangement | Research and Development Arrangement | Research and Development Arrangement | Research and Development Arrangement | |||||||||||||||||||||
Indefinite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Intangible assets | $0 | [1] | ' | ' | ' | $663,500,000 | [1] | ' | ' | ' | $0 | [1] | $663,500,000 | [1] | ' | ' | ' | ' | $412,900,000 | $412,900,000 | ' | $0 | $105,800,000 | ' | ' | ' | ' | $250,600,000 | $250,600,000 |
Deferred Tax Liabilities, Intangible Assets | 0 | ' | ' | ' | 229,696,000 | ' | ' | ' | 0 | 229,696,000 | ' | ' | ' | 127,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Intangible asset impairment charges | 250,600,000 | 0 | 0 | 412,900,000 | 0 | 0 | 0 | 0 | 663,500,000 | 0 | 105,800,000 | 412,900,000 | ' | ' | ' | ' | 105,800,000 | ' | ' | ' | ' | 250,600,000 | 250,600,000 | ' | ' | ||||
Change in deferred income taxes | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 127,600,000 | ' | ' | ' | ' | 32,700,000 | ' | ' | ' | ' | ' | 102,100,000 | ' | ' | ||||
Net increase to the Company's net loss per share related to the impairment charge (usd per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1.27 | ' | ' | ' | ' | $0.35 | ' | ' | ' | ' | ' | ' | ' | ' | ||||
fair value of intangible asset | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Increase in net loss related to impairment charge | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 285,300,000 | ' | ' | ' | ' | 73,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Goodwill | $30,992,000 | [1] | ' | ' | ' | $30,992,000 | [1] | ' | ' | ' | $30,992,000 | [1] | $30,992,000 | [1] | ' | ' | ' | ' | ' | ' | ' | ' | ' | $4,900,000 | $4,900,000 | ' | ' | ' | ' |
[1] | Amounts as of December 31, 2012 include the assets and liabilities of Vertex’s variable interest entity (“VIEâ€), Alios BioPharma, Inc. (“Aliosâ€). The Company deconsolidated Alios as of December 31, 2013. Vertex’s interests and obligations with respect to the VIE’s assets and liabilities are limited to those accorded to Vertex in its agreement with Alios. See Note B, "Collaborative Arrangements," to these consolidated financial statements for amounts. |
Accrued_Expenses_and_Other_Lia2
Accrued Expenses and Other Liabilities, Current Portion (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | ||
In Thousands, unless otherwise specified | ||||
Accrued expenses | ' | ' | ||
Product revenue allowances | $85,510 | $69,936 | ||
Payroll and benefits | 76,785 | 62,140 | ||
Research, development and commercial contract costs | 52,468 | 63,960 | ||
Royalty payable | 18,334 | 29,007 | ||
Other | 16,241 | 18,932 | ||
Professional fees | 10,593 | 11,226 | ||
Taxes payable | 8,362 | 2,182 | ||
Unrecognized tax benefits | 2,784 | 4,106 | ||
Interest | 0 | 3,395 | ||
Total | 271,077 | [1] | 264,884 | [1] |
Deferred rent | 16,652 | 14,302 | ||
Customer deposits | 7,692 | 0 | ||
Other | 392 | 5,400 | ||
Total | $24,736 | [1] | $19,702 | [1] |
[1] | Amounts as of December 31, 2012 include the assets and liabilities of Vertex’s variable interest entity (“VIEâ€), Alios BioPharma, Inc. (“Aliosâ€). The Company deconsolidated Alios as of December 31, 2013. Vertex’s interests and obligations with respect to the VIE’s assets and liabilities are limited to those accorded to Vertex in its agreement with Alios. See Note B, "Collaborative Arrangements," to these consolidated financial statements for amounts. |
Convertible_Senior_Subordinate1
Convertible Senior Subordinated Notes (Details) (USD $) | 3 Months Ended | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||
Jun. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2010 | Jun. 30, 2013 | Dec. 31, 2013 | |||
Convertible Senior Subordinated Notes 3.35 Percent Due 2015 | Convertible Senior Subordinated Notes 3.35 Percent Due 2015 | Convertible Senior Subordinated Notes 3.35 Percent Due 2015 | ||||||
Convertible Senior Subordinated Notes | ' | ' | ' | ' | ' | ' | ||
Convertible senior subordinated notes | ' | $0 | [1] | $400,000,000 | [1] | $400,000,000 | ' | ' |
Interest rate (as a percent) | ' | ' | ' | 3.35% | ' | ' | ||
Net proceeds from convertible debt offering | ' | ' | ' | 391,600,000 | ' | ' | ||
Underwriting discount | ' | ' | ' | 8,400,000 | ' | ' | ||
Conversion price (in dollars per share) | ' | ' | ' | $48.83 | ' | ' | ||
Original conversion rate, number of shares to be issued per $1000 of principal (in shares) | ' | ' | ' | ' | ' | 20.4794 | ||
Convertible debt principal amount, basis for exchange | ' | ' | ' | 1,000 | ' | ' | ||
Percent closing price needs to exceed the conversion price for at least 20 trading days within 30 consecutive trading days for provisional redemption (as a percent) | ' | ' | ' | 130.00% | ' | ' | ||
Minimum number of days within 30 consecutive trading days the closing price needs to exceed the conversion price for provisional redemption (in days) | ' | ' | ' | '20 days | ' | ' | ||
Total consecutive trading days during which the closing price must exceed the conversion price for at least 20 trading days for provisional redemption (in days) | ' | ' | ' | '30 days | ' | ' | ||
Redemption price (percent) | ' | ' | ' | 100.00% | ' | ' | ||
Debt Conversion, Converted Instrument, Amount | ' | ' | ' | ' | 399,800,000 | ' | ||
Stock Issued During Period, Shares, Conversion of Convertible Securities (shares) | ' | ' | ' | ' | 8,188,448 | ' | ||
Stock Redeemed or Called During Period, Value | ' | ' | ' | ' | 200,000 | ' | ||
Redemption premium (in usd per share) | ' | ' | ' | ' | 16.75 | ' | ||
Additional shares issued (shares) | 87,109 | ' | ' | ' | ' | ' | ||
Interest expense | ' | ' | ' | ' | 6,700,000 | ' | ||
Offset to additional paid-in capital | ' | ' | ' | ' | $4,200,000 | ' | ||
[1] | Amounts as of December 31, 2012 include the assets and liabilities of Vertex’s variable interest entity (“VIEâ€), Alios BioPharma, Inc. (“Aliosâ€). The Company deconsolidated Alios as of December 31, 2013. Vertex’s interests and obligations with respect to the VIE’s assets and liabilities are limited to those accorded to Vertex in its agreement with Alios. See Note B, "Collaborative Arrangements," to these consolidated financial statements for amounts. |
Common_Stock_Preferred_Stock_a2
Common Stock, Preferred Stock and Equity Plans (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
vote | |||
Share-based Compensation Arrangement by Share-based Payment Award | ' | ' | ' |
Common stock, shares authorized (shares) | 300,000,000 | 300,000,000 | ' |
Common stock, votes per share (votes per share) | 1 | ' | ' |
Preferred stock, shares authorized (shares) | 1,000,000 | 1,000,000 | ' |
Awards Outstanding (shares) | 17,894,079 | ' | ' |
Additional awards authorized for grant (in shares) | 5,411,351 | ' | ' |
Grant price of outstanding restricted stock and restricted stock units (in dollars per share) | $0.01 | $0.01 | $0.01 |
Outstanding and exercisable options | ' | ' | ' |
Stock options outstanding at beginning of period (in shares) | 19,726,000 | ' | ' |
Stock options granted (in shares) | 4,840,000 | ' | ' |
Stock options exercised (in shares) | -6,995,000 | ' | ' |
Stock options forfeited (in shares) | -1,822,000 | ' | ' |
Stock options expired (in shares) | -20,000 | ' | ' |
Stock options outstanding at end of period (in shares) | 15,729,000 | 19,726,000 | ' |
Stock options exercisable at end of period (in shares) | 7,950,000 | ' | ' |
Total exercisable or expected to vest, stock options (in shares) | 14,967,000 | ' | ' |
Weighted average Exercise Price | ' | ' | ' |
Weighted-average exercise price outstanding at beginning of period (usd per share) | $38.09 | ' | ' |
Weighted average exercise price, granted (usd per share) | $57.87 | ' | ' |
Weighted average exercise price, exercised (usd per share) | $35.28 | ' | ' |
Weighted average exercise price, forfeited (usd per share) | $46.89 | ' | ' |
Weighted average exercise price, expired (usd per share) | $46.64 | ' | ' |
Weighted-average exercise price outstanding at end of period (usd per share) | $44.40 | $38.09 | ' |
Weighted average exercise price exercisable at the end of the period (usd per share) | $38.84 | ' | ' |
Total exercisable or expected to vest, weighted average exercise price (usd per share) | $43.95 | ' | ' |
Weighted-average Remaining Contractual Life | ' | ' | ' |
Weighted-average Remaining Contractual Life, outstanding (in years) | '6 years 8 months 1 day | ' | ' |
Weighted-average Remaining Contractual Life, exercisable (in years) | '5 years 1 month 17 days | ' | ' |
Weighted-average Remaining Contractual Life, total exercisable or expected to vest (in years) | '6 years 6 months 22 days | ' | ' |
Aggregate Intrinsic Value | ' | ' | ' |
Aggregate intrinsic value, outstanding | $481,311,000 | ' | ' |
Aggregate intrinsic value, exercisable | 283,146,000 | ' | ' |
Aggregate intrinsic value, total exercisable or expected to vest | 463,885,000 | ' | ' |
Total Intrinsic Value and Cash Received | ' | ' | ' |
Market price | $74.21 | ' | ' |
Total intrinsic value of stock options exercised | 291,600,000 | 148,700,000 | 90,500,000 |
Total cash received from employees as a result of employee stock option exercises | $246,800,000 | $172,800,000 | $109,600,000 |
2013 Stock and Option Plan | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award | ' | ' | ' |
Common stock, shares authorized (shares) | 3,300,000 | ' | ' |
Awards Outstanding (shares) | 1,170,827 | ' | ' |
Additional awards authorized for grant (in shares) | 2,129,173 | ' | ' |
2006 Stock and Option Plan | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award | ' | ' | ' |
Awards Outstanding (shares) | 15,748,949 | ' | ' |
Additional awards authorized for grant (in shares) | 3,282,178 | 3,000,000 | ' |
1996 Stock and Option Plan | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award | ' | ' | ' |
Awards Outstanding (shares) | 974,303 | ' | ' |
Additional awards authorized for grant (in shares) | 0 | ' | ' |
Restricted stock | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award | ' | ' | ' |
Restricted stock, vested (in shares) | '4 years | ' | ' |
Common_Stock_Preferred_Stock_a3
Common Stock, Preferred Stock and Equity Plans (Details 2) (USD $) | 1 Months Ended | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Stock options outstanding and exercisable | ' | ' | ' | ' |
Exercise price range, options outstanding (in shares) | ' | 15,729,000 | ' | ' |
Exercise price range, options outstanding, weighted-average remaining contractual life (in years) | ' | '6 years 8 months 1 day | ' | ' |
Exercise price range, options outstanding, weighted-average exercise price (in dollars per share) | ' | $44.40 | ' | ' |
Exercise price range, options exercisable (in shares) | ' | 7,950,000 | ' | ' |
Exercise price range, options exercisable, weighted-average exercise price (in dollars per share) | ' | $38.84 | ' | ' |
Restricted stock | ' | ' | ' | ' |
Restricted stock, as of the beginning of the period (in shares) | ' | 2,270,000 | ' | ' |
Restricted stock, granted (in shares) | ' | 1,356,000 | ' | ' |
Restricted stock, vested (in shares) | ' | -800,000 | ' | ' |
Restricted stock, cancelled (in shares) | ' | -780,000 | ' | ' |
Restricted stock, as of the end of the period (in shares) | 2,270,000 | 2,046,000 | 2,270,000 | ' |
Restricted stock, weighted-average grant-date fair value | ' | ' | ' | ' |
Weighted-average grant-date fair value, as of the beginning of the period (in dollars per share) | ' | $42.92 | ' | ' |
Weighted-average grant-date fair value, granted (in dollars per share) | ' | $62.16 | ' | ' |
Weighted-average grant-date fair value, vested (in dollars per share) | ' | $42.27 | ' | ' |
Weighted-average grant-date fair value, cancelled (in dollars per share) | ' | $51.47 | ' | ' |
Weighted-average grant-date fair value, as of the end of the period (in dollars per share) | $42.92 | $52.66 | $42.92 | ' |
Vested in period, total fair value | $50.90 | ' | $41.10 | $34.60 |
Range of Exercise Prices, $9.07-$20.00 | ' | ' | ' | ' |
Stock options outstanding and exercisable | ' | ' | ' | ' |
Exercise price, low end of range (usd per share) | ' | $9.09 | ' | ' |
Exercise price, high end of range (usd per share) | ' | $20 | ' | ' |
Exercise price range, options outstanding (in shares) | ' | 432,000 | ' | ' |
Exercise price range, options outstanding, weighted-average remaining contractual life (in years) | ' | '2 years 4 months 13 days | ' | ' |
Exercise price range, options outstanding, weighted-average exercise price (in dollars per share) | ' | $15.37 | ' | ' |
Exercise price range, options exercisable (in shares) | ' | 432,000 | ' | ' |
Exercise price range, options exercisable, weighted-average exercise price (in dollars per share) | ' | $15.37 | ' | ' |
Range of Exercise Prices, $20.01-$30.00 | ' | ' | ' | ' |
Stock options outstanding and exercisable | ' | ' | ' | ' |
Exercise price, low end of range (usd per share) | ' | $20.01 | ' | ' |
Exercise price, high end of range (usd per share) | ' | $30 | ' | ' |
Exercise price range, options outstanding (in shares) | ' | 1,055,000 | ' | ' |
Exercise price range, options outstanding, weighted-average remaining contractual life (in years) | ' | '5 years 8 months 27 days | ' | ' |
Exercise price range, options outstanding, weighted-average exercise price (in dollars per share) | ' | $29.38 | ' | ' |
Exercise price range, options exercisable (in shares) | ' | 812,000 | ' | ' |
Exercise price range, options exercisable, weighted-average exercise price (in dollars per share) | ' | $29.23 | ' | ' |
Range of Exercise Prices, $30.01-$40.00 | ' | ' | ' | ' |
Stock options outstanding and exercisable | ' | ' | ' | ' |
Exercise price, low end of range (usd per share) | ' | $30.01 | ' | ' |
Exercise price, high end of range (usd per share) | ' | $40 | ' | ' |
Exercise price range, options outstanding (in shares) | ' | 6,842,000 | ' | ' |
Exercise price range, options outstanding, weighted-average remaining contractual life (in years) | ' | '5 years 26 days | ' | ' |
Exercise price range, options outstanding, weighted-average exercise price (in dollars per share) | ' | $36.55 | ' | ' |
Exercise price range, options exercisable (in shares) | ' | 4,773,000 | ' | ' |
Exercise price range, options exercisable, weighted-average exercise price (in dollars per share) | ' | $36.06 | ' | ' |
Range of Exercise Prices, $40.01-$50.00 | ' | ' | ' | ' |
Stock options outstanding and exercisable | ' | ' | ' | ' |
Exercise price, low end of range (usd per share) | ' | $40.01 | ' | ' |
Exercise price, high end of range (usd per share) | ' | $50 | ' | ' |
Exercise price range, options outstanding (in shares) | ' | 4,136,000 | ' | ' |
Exercise price range, options outstanding, weighted-average remaining contractual life (in years) | ' | '8 years 8 months 27 days | ' | ' |
Exercise price range, options outstanding, weighted-average exercise price (in dollars per share) | ' | $46.32 | ' | ' |
Exercise price range, options exercisable (in shares) | ' | 787,000 | ' | ' |
Exercise price range, options exercisable, weighted-average exercise price (in dollars per share) | ' | $46.62 | ' | ' |
Range of Exercise Prices, $50.01-$60.00 | ' | ' | ' | ' |
Stock options outstanding and exercisable | ' | ' | ' | ' |
Exercise price, low end of range (usd per share) | ' | $50.01 | ' | ' |
Exercise price, high end of range (usd per share) | ' | $60 | ' | ' |
Exercise price range, options outstanding (in shares) | ' | 1,713,000 | ' | ' |
Exercise price range, options outstanding, weighted-average remaining contractual life (in years) | ' | '7 years 1 month 28 days | ' | ' |
Exercise price range, options outstanding, weighted-average exercise price (in dollars per share) | ' | $53.78 | ' | ' |
Exercise price range, options exercisable (in shares) | ' | 874,000 | ' | ' |
Exercise price range, options exercisable, weighted-average exercise price (in dollars per share) | ' | $54.35 | ' | ' |
Price Range From Dollars $60.01-$70.00 | ' | ' | ' | ' |
Stock options outstanding and exercisable | ' | ' | ' | ' |
Exercise price, low end of range (usd per share) | ' | $60.01 | ' | ' |
Exercise price, high end of range (usd per share) | ' | $70 | ' | ' |
Exercise price range, options outstanding (in shares) | ' | 80,000 | ' | ' |
Exercise price range, options outstanding, weighted-average remaining contractual life (in years) | ' | '9 years 29 days | ' | ' |
Exercise price range, options outstanding, weighted-average exercise price (in dollars per share) | ' | $65.54 | ' | ' |
Exercise price range, options exercisable (in shares) | ' | 14,000 | ' | ' |
Exercise price range, options exercisable, weighted-average exercise price (in dollars per share) | ' | $63.20 | ' | ' |
Price Range From Dollars $70.01 to $80.00 | ' | ' | ' | ' |
Stock options outstanding and exercisable | ' | ' | ' | ' |
Exercise price, low end of range (usd per share) | ' | $70.01 | ' | ' |
Exercise price, high end of range (usd per share) | ' | $80 | ' | ' |
Exercise price range, options outstanding (in shares) | ' | 87,000 | ' | ' |
Exercise price range, options outstanding, weighted-average remaining contractual life (in years) | ' | '9 years 3 months 22 days | ' | ' |
Exercise price range, options outstanding, weighted-average exercise price (in dollars per share) | ' | $77.55 | ' | ' |
Exercise price range, options exercisable (in shares) | ' | 9,000 | ' | ' |
Exercise price range, options exercisable, weighted-average exercise price (in dollars per share) | ' | $77.73 | ' | ' |
Price Range From Dollars $80.01 to $88.18 | ' | ' | ' | ' |
Stock options outstanding and exercisable | ' | ' | ' | ' |
Exercise price, low end of range (usd per share) | ' | $80.01 | ' | ' |
Exercise price, high end of range (usd per share) | ' | $88.18 | ' | ' |
Exercise price range, options outstanding (in shares) | ' | 1,384,000 | ' | ' |
Exercise price range, options outstanding, weighted-average remaining contractual life (in years) | ' | '9 years 6 months | ' | ' |
Exercise price range, options outstanding, weighted-average exercise price (in dollars per share) | ' | $83.11 | ' | ' |
Exercise price range, options exercisable (in shares) | ' | 249,000 | ' | ' |
Exercise price range, options exercisable, weighted-average exercise price (in dollars per share) | ' | $82.13 | ' | ' |
Employee Stock Purchase Plan | ' | ' | ' | ' |
Employee Stock Purchase Plan | ' | ' | ' | ' |
Offering period | ' | '12 months | ' | ' |
Number of purchase periods (purchase periods) | ' | 2 | ' | ' |
Duration of purchase period | ' | '6 months | ' | ' |
Eligible employee purchase price percentage of fair value | ' | 85.00% | ' | ' |
Number of shares authorized (shares) | ' | 1,753,381 | ' | ' |
Number of shares (shares) | ' | 527,000 | ' | ' |
Average price paid per share (usd per share) | ' | $36.21 | ' | ' |
Stockbased_Compensation_Expens2
Stock-based Compensation Expense (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Stock-based compensation expense: | ' | ' | ' |
Total stock-based compensation expense included in costs and expenses | $127,303,000 | $114,285,000 | $118,226,000 |
Less: stock-based compensation expense capitalized to inventories | -1,048,000 | -1,254,000 | -1,042,000 |
Weighted-average assumptions for options and ESPP subscriptions granted | ' | ' | ' |
Weighted average fair value (in dollars per share) | $62.16 | ' | ' |
Stock Options | ' | ' | ' |
Weighted-average assumptions for options and ESPP subscriptions granted | ' | ' | ' |
Expected annual dividends | 0 | ' | ' |
Employee Stock Purchase Plan | ' | ' | ' |
Weighted-average assumptions for options and ESPP subscriptions granted | ' | ' | ' |
Expected stock price volatility (as a percent) | 54.69% | 46.90% | 51.32% |
Risk-free interest rate (as a percent) | 0.08% | 0.16% | 0.08% |
Expected term of options (in years) | '8 months 27 days | '8 months 27 days | '8 months 19 days |
Expected annual dividends | 0 | 0 | 0 |
Weighted average fair value (in dollars per share) | $21.08 | $12.90 | $9.80 |
Stock options | ' | ' | ' |
Stock-based compensation expense: | ' | ' | ' |
Total stock-based compensation expense included in costs and expenses | 85,067,000 | 79,047,000 | 83,098,000 |
Type of award: | ' | ' | ' |
Unrecognized Expense Net of Estimated Forfeitures | 141,283,000 | ' | ' |
Weighted-average Recognition Period (in years) | '2 years 6 months 22 days | ' | ' |
Weighted-average grant-date fair value, granted (in dollars per share) | $25.79 | $19.72 | $20.88 |
Weighted-average assumptions for options and ESPP subscriptions granted | ' | ' | ' |
Expected stock price volatility (as a percent) | 46.20% | 47.93% | 49.53% |
Risk-free interest rate (as a percent) | 1.25% | 0.95% | 2.09% |
Expected term of options (in years) | '5 years 9 months 22 days | '5 years 9 months 11 days | '5 years 8 months 27 days |
Expected annual dividends | 0 | 0 | 0 |
Restricted stock and restricted stock units | ' | ' | ' |
Stock-based compensation expense: | ' | ' | ' |
Total stock-based compensation expense included in costs and expenses | 36,479,000 | 29,194,000 | 30,708,000 |
Type of award: | ' | ' | ' |
Unrecognized Expense Net of Estimated Forfeitures | 73,490,000 | ' | ' |
Weighted-average Recognition Period (in years) | '2 years 5 months 19 days | ' | ' |
ESPP share issuances | ' | ' | ' |
Stock-based compensation expense: | ' | ' | ' |
Total stock-based compensation expense included in costs and expenses | 6,805,000 | 7,298,000 | 5,462,000 |
Type of award: | ' | ' | ' |
Unrecognized Expense Net of Estimated Forfeitures | 5,956,000 | ' | ' |
Weighted-average Recognition Period (in years) | '8 months 1 day | ' | ' |
Research and development expenses | ' | ' | ' |
Stock-based compensation expense: | ' | ' | ' |
Total stock-based compensation expense included in costs and expenses | 81,467,000 | 71,533,000 | 75,574,000 |
Sales, general and administrative expenses | ' | ' | ' |
Stock-based compensation expense: | ' | ' | ' |
Total stock-based compensation expense included in costs and expenses | $45,836,000 | $42,752,000 | $42,652,000 |
September_2009_Financial_Trans2
September 2009 Financial Transactions (Details) (USD $) | 12 Months Ended | 1 Months Ended | 12 Months Ended | ||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Feb. 28, 2011 | Sep. 30, 2009 | Dec. 31, 2011 | Oct. 31, 2011 | |
Olmsted Park S.A. [Member] | Olmsted Park S.A. [Member] | Olmsted Park S.A. [Member] | Olmsted Park S.A. [Member] | ||||
agreements | |||||||
2012 Notes | ' | ' | ' | ' | ' | ' | ' |
Face amount of 2012 Notes | ' | ' | ' | ' | $155,000,000 | ' | ' |
Proceeds from issuance of 2012 Notes | ' | ' | ' | ' | 122,200,000 | ' | ' |
Proceeds from milestone payment related to the acceptance of Janssen's MAA | ' | ' | ' | 50,000,000 | ' | ' | ' |
Portion of 2012 Notes redeemed upon achievement of certain approval milestone pursuant to the Janssen collaboration | ' | ' | ' | 50,000,000 | ' | ' | ' |
Earned remaining milestone payment to be received in the fourth quarter of 2011 | ' | ' | ' | ' | ' | ' | 105,000,000 |
Sale of Contingent Milestone Payments | ' | ' | ' | ' | ' | ' | ' |
Number of purchase agreements entered into related to sale of contingent launch milestone payments pursuant to the Janssen collaboration (agreements) | ' | ' | ' | ' | 2 | ' | ' |
Value of potential contingent launch milestone payments sold pursuant to the Janssen collaboration | ' | ' | ' | ' | 95,000,000 | ' | ' |
Proceeds from sale of potential contingent launch milestone payments pursuant to the Janssen collaboration | ' | ' | ' | ' | 32,800,000 | ' | ' |
Expenses and Losses (Gains): | ' | ' | ' | ' | ' | ' | ' |
Interest expense related to 2012 Notes | ' | ' | ' | ' | ' | 21,687,000 | ' |
Change in fair value of embedded derivative related to 2012 Notes | ' | ' | ' | ' | ' | -400,000 | ' |
Change in fair value of free-standing derivatives related to the sale of milestone payments | 0 | 0 | 16,801,000 | ' | ' | 17,201,000 | ' |
Total September 2009 financial transaction expenses | ' | ' | ' | ' | ' | $38,488,000 | ' |
Sale_of_HIV_Protease_Inhibitor1
Sale of HIV Protease Inhibitor Royalty Stream (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2008 | Dec. 31, 2013 |
Sale of HIV Protease Inhibitor Royalty Stream | ' | ' |
Gross proceeds from sale of royalty rights receivable from GlaxoSmithKline | $160 | ' |
Deferred revenues related to the one-time cash payment agreement with GlaxoSmithKline | ' | $63.50 |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Components of income (loss) before provision for (benefit from) income taxes | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
United States | ' | ' | ' | ' | ' | ' | ' | ' | ($390,009) | $256,816 | $343,515 |
Foreign | ' | ' | ' | ' | ' | ' | ' | ' | -586,108 | -269,197 | -283,070 |
Income (loss) before provision for (benefit from) income taxes | -340,253 | -129,413 | -63,511 | -442,940 | -80,772 | -5,112 | -14,405 | 87,908 | -976,117 | -12,381 | 60,445 |
Current taxes: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
United States | ' | ' | ' | ' | ' | ' | ' | ' | -11,420 | 2,057 | 22,275 |
Foreign | ' | ' | ' | ' | ' | ' | ' | ' | 1,084 | -1,865 | -561 |
State | ' | ' | ' | ' | ' | ' | ' | ' | 2,136 | 1,902 | 8,655 |
Total current taxes | ' | ' | ' | ' | ' | ' | ' | ' | -8,200 | 2,094 | 30,369 |
Deferred taxes: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
United States | ' | ' | ' | ' | ' | ' | ' | ' | -131,281 | 31,308 | 19,629 |
Foreign | ' | ' | ' | ' | ' | ' | ' | ' | -127,587 | 0 | -32,692 |
State | ' | ' | ' | ' | ' | ' | ' | ' | -21,499 | 5,352 | 1,960 |
Total deferred taxes | ' | ' | ' | ' | ' | ' | ' | ' | -280,367 | 36,660 | -11,103 |
Provision for (benefit from) income taxes | ($155,704) | ($751) | ($1,799) | ($130,313) | ($2,696) | $21,355 | $20,063 | $32 | ($288,567) | $38,754 | $19,266 |
Income_Taxes_Details_2
Income Taxes (Details 2) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Tax Carryforwards | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unrecognized Tax Benefits, Reduction Resulting from Lapse of Applicable Statute of Limitations and Settlements with Taxing Authorities, Estimated in Next Fiscal Year | $500,000 | ' | ' | ' | ' | ' | ' | ' | $500,000 | ' | ' |
Federal statutory income tax rate (percent) | ' | ' | ' | ' | ' | ' | ' | ' | 35.00% | 35.00% | 35.00% |
Reconciliation of Income Tax Expense: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income (loss) before provision for (benefit from) income taxes | -340,253,000 | -129,413,000 | -63,511,000 | -442,940,000 | -80,772,000 | -5,112,000 | -14,405,000 | 87,908,000 | -976,117,000 | -12,381,000 | 60,445,000 |
Expected tax provision (benefit) | ' | ' | ' | ' | ' | ' | ' | ' | -341,641,000 | -4,333,000 | 21,156,000 |
State taxes, net of federal benefit | ' | ' | ' | ' | ' | ' | ' | ' | -19,268,000 | 7,075,000 | 10,624,000 |
Foreign rate differential | ' | ' | ' | ' | ' | ' | ' | ' | 72,961,000 | 62,425,000 | 43,629,000 |
Tax credits | ' | ' | ' | ' | ' | ' | ' | ' | -16,775,000 | -1,980,000 | -51,086,000 |
Unbenefited operating losses | ' | ' | ' | ' | ' | ' | ' | ' | -43,570,000 | -30,364,000 | -6,286,000 |
Non-deductible expenses | ' | ' | ' | ' | ' | ' | ' | ' | 9,614,000 | 3,198,000 | 1,953,000 |
Rate change | ' | ' | ' | ' | ' | ' | ' | ' | 50,076,000 | 3,275,000 | 0 |
Other | ' | ' | ' | ' | ' | ' | ' | ' | 36,000 | -542,000 | -724,000 |
Provision for (benefit from) income taxes | -155,704,000 | -751,000 | -1,799,000 | -130,313,000 | -2,696,000 | 21,355,000 | 20,063,000 | 32,000 | -288,567,000 | 38,754,000 | 19,266,000 |
Federal net operating loss carryforward | 694,800,000 | ' | ' | ' | ' | ' | ' | ' | 694,800,000 | ' | ' |
Reconciliation of unrecognized tax benefits | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unrecognized tax benefits beginning of year | ' | ' | ' | 4,106,000 | ' | ' | ' | 4,360,000 | 4,106,000 | 4,360,000 | ' |
Gross change for current year positions | ' | ' | ' | ' | ' | ' | ' | ' | 1,325,000 | 598,000 | ' |
Increase for prior period positions | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | ' |
Decrease for prior period positions | ' | ' | ' | ' | ' | ' | ' | ' | -290,000 | 0 | ' |
Decrease due to settlements and payments | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | ' |
Decrease due to statute limitations | ' | ' | ' | ' | ' | ' | ' | ' | -185,000 | -852,000 | ' |
Deconsolidation of Alios | ' | ' | ' | ' | ' | ' | ' | ' | -2,932,000 | 0 | ' |
Unrecognized tax benefits end of year | 2,024,000 | ' | ' | ' | 4,106,000 | ' | ' | ' | 2,024,000 | 4,106,000 | 4,360,000 |
Deferred tax assets: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net operating loss | 850,946,000 | ' | ' | ' | 777,687,000 | ' | ' | ' | 850,946,000 | 777,687,000 | ' |
Tax credit carryforwards | 180,380,000 | ' | ' | ' | 147,074,000 | ' | ' | ' | 180,380,000 | 147,074,000 | ' |
Property and equipment | 0 | ' | ' | ' | 10,701,000 | ' | ' | ' | 0 | 10,701,000 | ' |
Intangible assets | 26,105,000 | ' | ' | ' | 63,353,000 | ' | ' | ' | 26,105,000 | 63,353,000 | ' |
Deferred revenues | 25,158,000 | ' | ' | ' | 44,867,000 | ' | ' | ' | 25,158,000 | 44,867,000 | ' |
Stock-based compensation | 63,521,000 | ' | ' | ' | 83,979,000 | ' | ' | ' | 63,521,000 | 83,979,000 | ' |
Inventories | 26,278,000 | ' | ' | ' | 56,564,000 | ' | ' | ' | 26,278,000 | 56,564,000 | ' |
Accrued expenses | 52,470,000 | ' | ' | ' | 27,945,000 | ' | ' | ' | 52,470,000 | 27,945,000 | ' |
Currency translation adjustment | 217,000 | ' | ' | ' | 0 | ' | ' | ' | 217,000 | 0 | ' |
Construction financing lease obligation | 152,688,000 | ' | ' | ' | 0 | ' | ' | ' | 152,688,000 | 0 | ' |
Gross deferred tax assets | 1,377,763,000 | ' | ' | ' | 1,212,170,000 | ' | ' | ' | 1,377,763,000 | 1,212,170,000 | ' |
Valuation allowance | -1,243,664,000 | ' | ' | ' | -1,211,561,000 | ' | ' | ' | -1,243,664,000 | -1,211,561,000 | ' |
Total deferred tax assets | 134,099,000 | ' | ' | ' | 609,000 | ' | ' | ' | 134,099,000 | 609,000 | ' |
Property and equipment | -134,099,000 | ' | ' | ' | 0 | ' | ' | ' | -134,099,000 | 0 | ' |
Deferred tax liabilities: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unrealized gain | 0 | ' | ' | ' | -376,000 | ' | ' | ' | 0 | -376,000 | ' |
Contingent milestone and royalty payment obligation | 0 | ' | ' | ' | -50,904,000 | ' | ' | ' | 0 | -50,904,000 | ' |
Acquired intangibles | 0 | ' | ' | ' | -229,696,000 | ' | ' | ' | 0 | -229,696,000 | ' |
Net deferred tax liabilities | 0 | ' | ' | ' | -280,367,000 | ' | ' | ' | 0 | -280,367,000 | ' |
Decreased in valuation allowance | ' | ' | ' | ' | ' | ' | ' | ' | -32,100,000 | ' | ' |
Federal | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Reconciliation of Income Tax Expense: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Operating Loss | 2,700,000,000 | ' | ' | ' | ' | ' | ' | ' | 2,700,000,000 | ' | ' |
Tax Credit | 120,100,000 | ' | ' | ' | ' | ' | ' | ' | 120,100,000 | ' | ' |
State | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Reconciliation of Income Tax Expense: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Operating Loss | 966,800,000 | ' | ' | ' | ' | ' | ' | ' | 966,800,000 | ' | ' |
Tax Credit | 66,900,000 | ' | ' | ' | ' | ' | ' | ' | 66,900,000 | ' | ' |
Federal net operating loss carryforward | $204,500,000 | ' | ' | ' | ' | ' | ' | ' | $204,500,000 | ' | ' |
Restructuring_Expense_Details
Restructuring Expense (Details) (USD $) | 3 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 12 Months Ended | 108 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2003 | Dec. 31, 2003 | Dec. 31, 2003 | Dec. 31, 2003 | Jun. 30, 2003 | Jan. 31, 2003 | Dec. 31, 2006 | Dec. 31, 2003 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2010 | Dec. 31, 2003 | |
Lease restructuring and other operating lease expense | Employee severance, benefits and related costs | Leasehold improvements and asset impairments | Kendall Square Facility | Kendall Square Facility | Kendall Square Facility | Kendall Square Facility | Fan Pier Move | 2003 Restructuring | 2003 Restructuring | 2003 Restructuring | 2003 Restructuring | 2003 Restructuring | 2003 Restructuring | |||||||||||||
squarefeet | squarefeet | |||||||||||||||||||||||||
Kendall Square Lease | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Leased area (in square feet) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 290,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Lease term (in years) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '15 years | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Occupied leased area (in square feet) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 120,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Discount rate, lease restructuring liability (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | ' | ' | ' | ' | ' | ' | ' |
Restructuring Expense | $27,658,000 | $12,048,000 | $776,000 | $39,000 | $194,000 | $696,000 | $594,000 | $360,000 | $40,521,000 | $1,844,000 | $2,074,000 | $91,824,000 | $84,726,000 | $2,616,000 | $4,482,000 | ' | ' | ' | ' | $1,200,000 | $372,000 | $1,844,000 | $2,074,000 | $62,851,000 | ' | ' |
Cash Payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -17,816,000 | -15,200,000 | -2,616,000 | 0 | ' | ' | ' | ' | ' | -15,255,000 | -14,853,000 | -14,904,000 | -178,952,000 | ' | ' |
Non-cash Expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -4,482,000 | 0 | 0 | -4,482,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring Liability | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 69,526,000 | 69,526,000 | 0 | 0 | ' | ' | ' | ' | ' | 19,115,000 | 23,328,000 | 26,313,000 | 23,328,000 | 29,595,000 | 69,526,000 |
Lease restructuring expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 78,700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Lease operating expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $6,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring_Expense_Details_
Restructuring Expense (Details 2) (USD $) | 3 Months Ended | 12 Months Ended | 108 Months Ended | |||||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2003 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2012 |
2003 Restructuring | 2003 Restructuring | 2003 Restructuring | 2003 Restructuring | |||||||||||||
Restructuring activities | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Liability, beginning of the period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $23,328 | $26,313 | $29,595 | $69,526 |
Cash Payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -17,816 | -15,255 | -14,853 | -14,904 | -178,952 |
Cash received from subleases | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,670 | 10,024 | 9,548 | 75,708 |
Credit for portion of facility Vertex decided to occupy in 2005 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | 0 | -10,018 |
Restructuring Expense | 27,658 | 12,048 | 776 | 39 | 194 | 696 | 594 | 360 | 40,521 | 1,844 | 2,074 | 91,824 | 372 | 1,844 | 2,074 | 62,851 |
Liability, end of the period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $69,526 | $19,115 | $23,328 | $26,313 | $23,328 |
Restructuring_ExpenseStrategic
Restructuring Expense-Strategic Restructuring (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2003 | |
sqft | sqft | |||||||||||||
Restructuring Cost and Reserve [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expected restructuring charges | ' | ' | ' | ' | ' | ' | ' | ' | $500,000 | $7,900,000 | ' | ' | ' | ' |
Restructuring Expense | 27,658,000 | 12,048,000 | 776,000 | 39,000 | 194,000 | 696,000 | 594,000 | 360,000 | ' | ' | 40,521,000 | 1,844,000 | 2,074,000 | 91,824,000 |
Cash Payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -17,816,000 |
Non-cash Expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 7,594,000 | 0 | 0 | ' |
Restructuring Liability | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 69,526,000 |
Area of Real Estate Property | 120,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 120,000 | ' | ' | ' |
Minimum | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring Cost and Reserve [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expected restructuring charges | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,000,000 | ' | ' | ' |
Maximum | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring Cost and Reserve [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expected restructuring charges | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,500,000 | ' | ' | ' |
2013 Restructuring Plan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring Cost and Reserve [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring Expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 38,951,000 | ' | ' | ' |
Cash Payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -22,916,000 | ' | ' | ' |
Non-cash Expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -7,594,000 | ' | ' | ' |
Restructuring Liability | 8,441,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8,441,000 | ' | ' | ' |
2013 Restructuring Plan | Employee severance, benefits and related costs | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring Cost and Reserve [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring Expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25,060,000 | ' | ' | ' |
Cash Payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -21,458,000 | ' | ' | ' |
Non-cash Expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -1,312,000 | ' | ' | ' |
Restructuring Liability | 2,290,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,290,000 | ' | ' | ' |
2013 Restructuring Plan | Asset impairments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring Cost and Reserve [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring Expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,282,000 | ' | ' | ' |
Cash Payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' | ' | ' |
Non-cash Expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -6,282,000 | ' | ' | ' |
Restructuring Liability | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' | ' | ' |
2013 Restructuring Plan | Contract termination and other associated costs | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring Cost and Reserve [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring Expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 7,609,000 | ' | ' | ' |
Cash Payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -1,458,000 | ' | ' | ' |
Non-cash Expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' | ' | ' |
Restructuring Liability | $6,151,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | $6,151,000 | ' | ' | ' |
Employee_Benefits_Details
Employee Benefits (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Compensation and Retirement Disclosure [Abstract] | ' | ' | ' |
Compensation and Employee Benefit Plans [Text Block] | $2,400,000 | ' | ' |
Maximum percentage of annual compensation contributed by the participant (as a percent) | 60.00% | ' | ' |
Common stock shares remained available for grant (shares) | 755,000 | ' | ' |
Matching contributions to the Vertex 401(k) Plan: | ' | ' | ' |
Discretionary matching contributions during the year ended December 31, | 5,930,000 | 10,261,000 | 8,619,000 |
Shares issued during the year ended December 31 (shares) | 99,000 | 242,000 | 183,000 |
Shares issuable as of the year ended December 31 (shares) | 0 | 53,000 | 62,000 |
Contributions by employer | $5,000,000 | ' | ' |
Commitments_Details
Commitments (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
leases | |||
Operating lease | ' | ' | ' |
Number of leases (leases) | ' | ' | 2 |
Future minimum commitments under facility leases commitments with terms of more than one year | ' | ' | ' |
2014 | $119,301,000 | ' | ' |
2015 | 116,487,000 | ' | ' |
2016 | 101,519,000 | ' | ' |
2017 | 100,080,000 | ' | ' |
2018 | 86,673,000 | ' | ' |
Thereafter | 828,142,000 | ' | ' |
Total minimum lease payments | 1,352,202,000 | ' | ' |
Future minimum sublease income | ' | ' | ' |
2014 | -8,546,000 | ' | ' |
2015 | -3,996,000 | ' | ' |
2016 | 0 | ' | ' |
2017 | 0 | ' | ' |
2018 | 0 | ' | ' |
Thereafter | 0 | ' | ' |
Total minimum lease payments | -12,542,000 | ' | ' |
Rental expense | 57,700,000 | 57,100,000 | 49,400,000 |
Fan Pier Leases | ' | ' | ' |
Future minimum commitments under facility leases commitments with terms of more than one year | ' | ' | ' |
2014 | 67,206,000 | ' | ' |
2015 | 67,206,000 | ' | ' |
2016 | 67,206,000 | ' | ' |
2017 | 67,206,000 | ' | ' |
2018 | 67,206,000 | ' | ' |
Thereafter | 752,798,000 | ' | ' |
Total minimum lease payments | 1,088,828,000 | ' | ' |
Kendall Square Lease | ' | ' | ' |
Operating lease | ' | ' | ' |
Optional term of lease agreement (in years) | ' | ' | '10 years |
Office space used for operation (in square feet) | 120,000 | ' | ' |
Future minimum commitments under facility leases commitments with terms of more than one year | ' | ' | ' |
2014 | 19,879,000 | ' | ' |
2015 | 19,879,000 | ' | ' |
2016 | 19,879,000 | ' | ' |
2017 | 19,879,000 | ' | ' |
2018 | 6,626,000 | ' | ' |
Thereafter | 0 | ' | ' |
Total minimum lease payments | 86,142,000 | ' | ' |
Other Operating Leases | ' | ' | ' |
Future minimum commitments under facility leases commitments with terms of more than one year | ' | ' | ' |
2014 | 40,762,000 | ' | ' |
2015 | 33,398,000 | ' | ' |
2016 | 14,434,000 | ' | ' |
2017 | 12,995,000 | ' | ' |
2018 | 12,841,000 | ' | ' |
Thereafter | 75,344,000 | ' | ' |
Total minimum lease payments | $189,774,000 | ' | ' |
Minimum | ' | ' | ' |
Future minimum sublease income | ' | ' | ' |
Effective interest rate (percentage) | 2.00% | ' | ' |
Maximum | ' | ' | ' |
Future minimum sublease income | ' | ' | ' |
Effective interest rate (percentage) | 7.00% | ' | ' |
Commitments_Capital_Lease_Fina
Commitments Capital Lease Financing Obligations (Details) (USD $) | 12 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jun. 30, 2013 | |
Capital Leases, Future Minimum Payments Due [Abstract] | ' | ' | ' | ' |
2014 | $19,957,000 | ' | ' | ' |
2015 | 18,346,000 | ' | ' | ' |
2016 | 11,809,000 | ' | ' | ' |
2017 | 10,714,000 | ' | ' | ' |
2018 | 10,612,000 | ' | ' | ' |
Thereafter | 2,121,000 | ' | ' | ' |
Total payments | 73,559,000 | ' | ' | ' |
Less: amount representing interest | -7,912,000 | ' | ' | ' |
Present value of payments | 65,647,000 | ' | ' | ' |
Letter of credit, amount outstanding | ' | ' | ' | 31,900,000 |
Term of letter of credit | '1 year | ' | ' | ' |
Decrease in restricted cash | ($31,804,000) | ($2,156,000) | $0 | ' |
Segment_Information_Details
Segment Information (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Revenues from external customers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product revenues, net | $128,822 | $186,653 | $254,789 | $267,381 | $281,309 | $303,501 | $373,273 | $375,375 | $837,645 | $1,333,458 | $950,889 |
Total revenues | 351,157 | 221,700 | 310,750 | 328,368 | 333,994 | 336,006 | 418,305 | 438,737 | 1,211,975 | 1,527,042 | 1,410,626 |
Property and equipment, net | 696,911 | ' | ' | ' | 433,609 | ' | ' | ' | 696,911 | 433,609 | ' |
United States | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from external customers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total revenues | ' | ' | ' | ' | ' | ' | ' | ' | 896,952 | 1,373,516 | 1,389,568 |
Property and equipment, net | 657,587 | ' | ' | ' | 400,102 | ' | ' | ' | 657,587 | 400,102 | ' |
Europe [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from external customers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total revenues | ' | ' | ' | ' | ' | ' | ' | ' | 279,557 | 129,786 | 20,289 |
Outside of the United States | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from external customers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total revenues | ' | ' | ' | ' | ' | ' | ' | ' | 315,023 | 153,526 | 21,058 |
Property and equipment, net | 39,324 | ' | ' | ' | 33,507 | ' | ' | ' | 39,324 | 33,507 | ' |
United Kingdom | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from external customers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Property and equipment, net | 29,970 | ' | ' | ' | 30,622 | ' | ' | ' | 29,970 | 30,622 | ' |
Other | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from external customers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total revenues | ' | ' | ' | ' | ' | ' | ' | ' | 35,466 | 23,740 | 769 |
Property and equipment, net | 9,354 | ' | ' | ' | 2,885 | ' | ' | ' | 9,354 | 2,885 | ' |
Minimum | Revenues, Net | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from external customers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration risk (less than 10% for Cardinal health, Janssen and Mitsubishi Tanabe) (percentage) | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | 10.00% | ' |
Minimum | Accounts Receivable | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from external customers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Threshold for disclosure percentage | 10.00% | ' | ' | ' | 10.00% | ' | ' | ' | 10.00% | 10.00% | ' |
Credit Concentration Risk | Janssen | Revenues, Net | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from external customers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration risk (less than 10% for Cardinal health, Janssen and Mitsubishi Tanabe) (percentage) | ' | ' | ' | ' | ' | ' | ' | ' | 22.00% | 10.00% | 19.00% |
Credit Concentration Risk | Janssen | Accounts Receivable | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from external customers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration risk (less than 10% for Cardinal health, Janssen and Mitsubishi Tanabe) (percentage) | ' | ' | ' | ' | ' | ' | ' | ' | 28.00% | 26.00% | ' |
Credit Concentration Risk | AmerisourceBergen Drug Corporation | Revenues, Net | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from external customers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration risk (less than 10% for Cardinal health, Janssen and Mitsubishi Tanabe) (percentage) | ' | ' | ' | ' | ' | ' | ' | ' | 21.00% | 32.00% | 25.00% |
Credit Concentration Risk | AmerisourceBergen Drug Corporation | Accounts Receivable | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from external customers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration risk (less than 10% for Cardinal health, Janssen and Mitsubishi Tanabe) (percentage) | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | 22.00% | ' |
Credit Concentration Risk | McKesson Corporation | Revenues, Net | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from external customers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration risk (less than 10% for Cardinal health, Janssen and Mitsubishi Tanabe) (percentage) | ' | ' | ' | ' | ' | ' | ' | ' | 21.00% | 29.00% | 24.00% |
Credit Concentration Risk | McKesson Corporation | Accounts Receivable | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from external customers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration risk (less than 10% for Cardinal health, Janssen and Mitsubishi Tanabe) (percentage) | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | 26.00% | ' |
Credit Concentration Risk | Cardinal Health Incorporated | Revenues, Net | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from external customers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration risk (less than 10% for Cardinal health, Janssen and Mitsubishi Tanabe) (percentage) | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | 15.00% | 15.00% |
Credit Concentration Risk | Cardinal Health Incorporated | Accounts Receivable | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from external customers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration risk (less than 10% for Cardinal health, Janssen and Mitsubishi Tanabe) (percentage) | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | 10.00% | ' |
Credit Concentration Risk | Bupa Home Healthcare Limited | Revenues, Net | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from external customers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration risk (less than 10% for Cardinal health, Janssen and Mitsubishi Tanabe) (percentage) | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | 10.00% | ' |
Credit Concentration Risk | Bupa Home Healthcare Limited | Accounts Receivable | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from external customers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration risk (less than 10% for Cardinal health, Janssen and Mitsubishi Tanabe) (percentage) | ' | ' | ' | ' | ' | ' | ' | ' | 14.00% | ' | ' |
INCIVEK | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from external customers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product revenues, net | ' | ' | ' | ' | ' | ' | ' | ' | 466,360 | 1,161,813 | 950,889 |
KALYDECO | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from external customers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product revenues, net | ' | ' | ' | ' | ' | ' | ' | ' | $371,285 | $171,645 | $0 |
Quarterly_Financial_Data_unaud2
Quarterly Financial Data (unaudited) (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||||||||
Share data in Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2003 | ||||
Revenues: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Product revenues, net | $128,822,000 | $186,653,000 | $254,789,000 | $267,381,000 | $281,309,000 | $303,501,000 | $373,273,000 | $375,375,000 | $837,645,000 | $1,333,458,000 | $950,889,000 | ' | ||||
Royalty revenues | 36,887,000 | 27,012,000 | 49,120,000 | 43,573,000 | 43,451,000 | 25,586,000 | 33,480,000 | 38,981,000 | 156,592,000 | 141,498,000 | 50,015,000 | ' | ||||
Collaborative revenues (1) | 185,448,000 | 8,035,000 | 6,841,000 | 17,414,000 | 9,234,000 | 6,919,000 | 11,552,000 | 24,381,000 | 217,738,000 | 52,086,000 | 409,722,000 | ' | ||||
Total revenues | 351,157,000 | 221,700,000 | 310,750,000 | 328,368,000 | 333,994,000 | 336,006,000 | 418,305,000 | 438,737,000 | 1,211,975,000 | 1,527,042,000 | 1,410,626,000 | ' | ||||
Costs and expenses: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Cost of product revenues (2) | 13,281,000 | 20,048,000 | 24,695,000 | 30,955,000 | 75,595,000 | 30,680,000 | 104,549,000 | 25,918,000 | 88,979,000 | 236,742,000 | 63,625,000 | ' | ||||
Royalty expenses | 8,983,000 | 7,291,000 | 13,236,000 | 11,788,000 | 12,120,000 | 7,856,000 | 9,874,000 | 13,293,000 | 41,298,000 | 43,143,000 | 16,880,000 | ' | ||||
Research and development expenses | 249,609,000 | 228,624,000 | 222,455,000 | 218,095,000 | 213,109,000 | 200,161,000 | 196,544,000 | 196,371,000 | 918,783,000 | 806,185,000 | 707,706,000 | ' | ||||
Sales, general and administrative expenses | 75,188,000 | 87,754,000 | 106,521,000 | 92,879,000 | 110,452,000 | 97,684,000 | 117,514,000 | 111,146,000 | 362,342,000 | 436,796,000 | 400,721,000 | ' | ||||
Restructuring expenses | 27,658,000 | 12,048,000 | 776,000 | 39,000 | 194,000 | 696,000 | 594,000 | 360,000 | 40,521,000 | 1,844,000 | 2,074,000 | 91,824,000 | ||||
Intangible asset impairment charges | 250,600,000 | 0 | 0 | 412,900,000 | 0 | 0 | 0 | 0 | 663,500,000 | 0 | 105,800,000 | ' | ||||
Total costs and expenses | 625,319,000 | 355,765,000 | 367,683,000 | 766,656,000 | 411,470,000 | 337,077,000 | 429,075,000 | 347,088,000 | 2,115,423,000 | 1,524,710,000 | 1,296,806,000 | ' | ||||
Income (loss) from operations | -274,162,000 | -134,065,000 | -56,933,000 | -438,288,000 | -77,476,000 | -1,071,000 | -10,770,000 | 91,649,000 | -903,448,000 | 2,332,000 | 113,820,000 | ' | ||||
Interest expense, net | -12,619,000 | -95,000 | -6,551,000 | -3,465,000 | -3,263,000 | -4,054,000 | -3,814,000 | -3,891,000 | -22,730,000 | -15,022,000 | -37,681,000 | ' | ||||
Interest expense | ' | ' | ' | ' | -33,000 | 13,000 | 179,000 | 150,000 | ' | ' | ' | ' | ||||
Other income (expense), net | 53,472,000 | -4,747,000 | 27,000 | 1,187,000 | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Income (loss) before provision for (benefit from) income taxes | -340,253,000 | -129,413,000 | -63,511,000 | -442,940,000 | -80,772,000 | -5,112,000 | -14,405,000 | 87,908,000 | -976,117,000 | -12,381,000 | 60,445,000 | ' | ||||
Benefit from income taxes (3)(4) | -155,704,000 | -751,000 | -1,799,000 | -130,313,000 | -2,696,000 | 21,355,000 | 20,063,000 | 32,000 | -288,567,000 | 38,754,000 | 19,266,000 | ' | ||||
Net income (loss) | -184,549,000 | -128,662,000 | -61,712,000 | -312,627,000 | -78,076,000 | -26,467,000 | -34,468,000 | 87,876,000 | -687,550,000 | -51,135,000 | 41,179,000 | ' | ||||
Net loss (income) attributable to noncontrolling interest (Alios) | 228,834,000 | 4,530,000 | 4,547,000 | 4,611,000 | 1,928,000 | -31,076,000 | -30,463,000 | 3,714,000 | 242,522,000 | -55,897,000 | -11,605,000 | ' | ||||
Net income (loss) attributable to Vertex | 44,285,000 | -124,132,000 | -57,165,000 | -308,016,000 | -76,148,000 | -57,543,000 | -64,931,000 | 91,590,000 | -445,028,000 | -107,032,000 | 29,574,000 | ' | ||||
Net income (loss) per share attributable to Vertex common shareholders: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Basic (usd per share) | $0.19 | ($0.54) | ($0.26) | ($1.43) | ($0.35) | ($0.27) | ($0.31) | $0.44 | ($1.98) | ($0.50) | $0.14 | ' | ||||
Diluted (usd per share) | $0.19 | ($0.54) | ($0.26) | ($1.43) | ($0.35) | ($0.27) | ($0.31) | $0.43 | ($1.98) | ($0.50) | $0.14 | ' | ||||
Shares used in per share calculations: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Basic (shares) | 231,264 | 230,505 | 222,053 | 215,421 | 214,607 | 213,767 | 211,344 | 208,018 | 224,906 | 211,946 | 204,891 | ' | ||||
Diluted (shares) | 235,717 | 230,505 | 222,053 | 215,421 | 214,607 | 213,767 | 211,344 | 219,264 | 224,906 | 211,946 | 208,807 | ' | ||||
Write-downs of inventories to net realizable value | ' | ' | ' | ' | ' | ' | ' | ' | 10,358,000 | 133,189,000 | 0 | ' | ||||
Write-down of inventories effect on net income (loss) per share (usd per share) | ' | ' | ' | ' | ' | ' | ' | ' | ($0.05) | ($0.61) | ' | ' | ||||
Intangible assets | 0 | [1] | ' | ' | ' | 663,500,000 | [1] | ' | ' | ' | 0 | [1] | 663,500,000 | [1] | ' | ' |
Janssen | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Revenues: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Royalty revenues | ' | ' | ' | ' | ' | ' | ' | ' | 130,724,000 | 117,592,000 | 20,289,000 | ' | ||||
Collaborative revenues (1) | 182,400,000 | ' | ' | ' | ' | ' | ' | ' | 203,437,000 | 16,178,000 | 274,393,000 | ' | ||||
Total revenues | ' | ' | ' | ' | ' | ' | ' | ' | 334,161,000 | 133,770,000 | 294,682,000 | ' | ||||
Alios Bio Pharma Inc | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Costs and expenses: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Benefit from income taxes (3)(4) | ' | ' | ' | ' | ' | ' | ' | ' | -166,145,000 | 39,029,000 | 48,809,000 | ' | ||||
Net loss (income) attributable to noncontrolling interest (Alios) | ' | ' | ' | ' | ' | ' | ' | ' | -242,522,000 | 55,897,000 | 11,605,000 | ' | ||||
Research and Development Arrangement | Alios Bio Pharma Inc | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Costs and expenses: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Intangible asset impairment charges | 250,600,000 | ' | ' | ' | ' | ' | ' | ' | 250,600,000 | ' | ' | ' | ||||
Shares used in per share calculations: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Intangible assets | ' | ' | ' | ' | $250,600,000 | ' | ' | ' | ' | $250,600,000 | $250,600,000 | ' | ||||
[1] | Amounts as of December 31, 2012 include the assets and liabilities of Vertex’s variable interest entity (“VIEâ€), Alios BioPharma, Inc. (“Aliosâ€). The Company deconsolidated Alios as of December 31, 2013. Vertex’s interests and obligations with respect to the VIE’s assets and liabilities are limited to those accorded to Vertex in its agreement with Alios. See Note B, "Collaborative Arrangements," to these consolidated financial statements for amounts. |