Cover
Cover - shares | 6 Months Ended | |
Jun. 30, 2021 | Jul. 30, 2021 | |
Entity Addresses [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-33093 | |
Entity Registrant Name | LIGAND PHARMACEUTICALS INCORPORATED | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 77-0160744 | |
Entity Address, Address Line One | 5980 Horton Street, Suite 405 | |
Entity Address, City or Town | Emeryville | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 94608 | |
City Area Code | 858 | |
Local Phone Number | 550-7500 | |
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Trading Symbol | LGND | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 16,676,532 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q2 | |
Entity Central Index Key | 0000886163 | |
Current Fiscal Year End Date | --12-31 | |
Former Address | ||
Entity Addresses [Line Items] | ||
Entity Address, Address Line One | 3911 Sorrento Valley Boulevard, Suite 110 | |
Entity Address, City or Town | San Diego | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92121 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 21,863 | $ 47,619 |
Short-term investments | 279,972 | 363,567 |
Accounts receivable, net | 58,156 | 56,847 |
Inventory | 39,946 | 26,487 |
Income taxes receivable | 4,694 | 2,217 |
Other current assets | 6,270 | 3,822 |
Total current assets | 410,901 | 500,559 |
Deferred income taxes, net | 27,882 | 24,320 |
Intangible assets, net | 572,006 | 595,330 |
Goodwill | 190,517 | 189,662 |
Commercial license and other economic rights, net | 10,638 | 10,979 |
Property and equipment, net | 17,628 | 14,434 |
Operating lease right-of-use assets | 6,500 | 6,892 |
Financing lease right-of-use assets | 17,383 | 15,842 |
Other assets | 2,828 | 4,267 |
Total assets | 1,256,283 | 1,362,285 |
Current liabilities: | ||
Accounts payable | 17,273 | 3,784 |
Accrued liabilities | 10,107 | 18,530 |
Current contingent liabilities | 5,650 | 39,884 |
Deferred revenue | 17,147 | 29,435 |
Current operating lease liabilities | 2,275 | 1,885 |
Current financing lease liabilities | 45 | 6,593 |
Total current liabilities | 52,497 | 100,111 |
2023 convertible senior notes, net | 315,318 | 442,293 |
Long-term contingent liabilities | 9,121 | 9,249 |
Deferred income taxes, net | 60,053 | 64,598 |
Long-term operating lease liabilities | 4,771 | 5,643 |
Other long-term liabilities | 28,006 | 30,866 |
Total liabilities | 469,766 | 652,760 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value; 5,000 shares authorized; zero issued and outstanding at June 30, 2021 and December 31, 2020 | 0 | 0 |
Common stock, $0.001 par value; 60,000 shares authorized; 16,676 and 16,080 shares issued and outstanding at June 30, 2021 and December 31, 2020, respectively | 17 | 16 |
Additional paid-in capital | 346,578 | 318,358 |
Accumulated other comprehensive loss | (861) | (801) |
Retained earnings | 440,783 | 391,952 |
Total stockholders' equity | 786,517 | 709,525 |
Total liabilities and stockholders' equity | $ 1,256,283 | $ 1,362,285 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares | Jun. 30, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (USD per share) | $ 0.001 | $ 0.001 |
Preferred stock authorized (shares) | 5,000,000 | 5,000,000 |
Preferred stock issued (shares) | 0 | 0 |
Preferred stock outstanding (shares) | 0 | 0 |
Common stock, par value (USD per share) | $ 0.001 | $ 0.001 |
Common stock authorized (shares) | 60,000,000 | 60,000,000 |
Common stock issued (shares) | 16,676,000 | 16,080,000 |
Common stock outstanding (shares) | 16,676,000 | 16,080,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Revenues: | ||||
Total revenues | $ 84,675 | $ 41,420 | $ 139,825 | $ 74,581 |
Operating costs and expenses: | ||||
Cost of Captisol | 30,593 | 7,644 | 38,746 | 12,327 |
Amortization of intangibles | 11,779 | 3,875 | 23,565 | 7,410 |
Research and development | 15,953 | 12,732 | 33,832 | 24,623 |
General and administrative | 14,711 | 10,069 | 27,028 | 19,333 |
Other operating income | (34,100) | 0 | (33,800) | 0 |
Total operating costs and expenses | 38,936 | 34,320 | 89,371 | 63,693 |
Income from operations | 45,739 | 7,100 | 50,454 | 10,888 |
Other income (expense): | ||||
Gain (loss) from short-term investments | (6,864) | 23,460 | 6,197 | (7,281) |
Interest income | 233 | 1,969 | 529 | 6,699 |
Interest expense | (4,883) | (6,213) | (10,714) | (14,761) |
Other income (expense), net | (924) | 1,803 | (7,401) | 2,159 |
Total other income (loss), net | (12,438) | 21,019 | (11,389) | (13,184) |
Income (loss) before income taxes | 33,301 | 28,119 | 39,065 | (2,296) |
Income tax benefit (expense) | (2,576) | (6,033) | 9,766 | 251 |
Net income (loss) | $ 30,725 | $ 22,086 | $ 48,831 | $ (2,045) |
Earnings Per Share, Basic and Diluted: | ||||
Basic net income (loss) per share (USD per share) | $ 1.84 | $ 1.38 | $ 2.95 | $ (0.13) |
Shares used in basic per share calculations (in shares) | 16,659 | 16,055 | 16,548 | 16,292 |
Diluted net income (loss) per share (USD per share) | $ 1.79 | $ 1.32 | $ 2.84 | $ (0.13) |
Shares used in diluted per share calculations (in shares) | 17,172 | 16,694 | 17,210 | 16,292 |
Royalties | ||||
Revenues: | ||||
Total revenues | $ 8,616 | $ 7,181 | $ 15,728 | $ 13,746 |
Captisol | ||||
Revenues: | ||||
Total revenues | 62,509 | 24,468 | 93,781 | 45,577 |
Contract revenue | ||||
Revenues: | ||||
Total revenues | $ 13,550 | $ 9,771 | $ 30,316 | $ 15,258 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss): | $ 30,725 | $ 22,086 | $ 48,831 | $ (2,045) |
Unrealized net gain (loss) on available-for-sale securities, net of tax | (5) | 2,742 | (60) | (30) |
Foreign currency translation | 0 | (185) | 0 | (2,064) |
Comprehensive income (loss) | $ 30,720 | $ 24,643 | $ 48,771 | $ (4,139) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) - USD ($) | Total | Adjustment | Common Stock | Additional paid in capital | Accumulated other comprehensive loss | Retained earnings (Accumulated deficit) | Retained earnings (Accumulated deficit)Adjustment |
Balance at beginning of period (shares) at Dec. 31, 2019 | 16,823,000 | ||||||
Balance at beginning of period at Dec. 31, 2019 | $ 767,232,000 | $ (5,167,000) | $ 17,000 | $ 367,326,000 | $ (216,000) | $ 400,105,000 | $ (5,167,000) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of common stock under employee stock compensation plans, net (shares) | 105,000 | ||||||
Issuance of common stock under employee stock compensation plans, net | (1,008,000) | (1,008,000) | |||||
Share-based compensation | 5,653,000 | 5,653,000 | |||||
Repurchase of common stock (shares) | (878,000) | ||||||
Repurchase of common stock | (73,287,000) | $ (1,000) | (73,286,000) | ||||
Unrealized net gain (loss) on available-for-sale securities, net of deferred tax | (2,772,000) | (2,772,000) | |||||
Foreign currency translation adjustment | (1,879,000) | (1,879,000) | |||||
Reacquisition of equity due to 2023 debt extinguishment, net of tax | (2,745,000) | (2,745,000) | |||||
Net income (loss) | (24,131,000) | (24,131,000) | |||||
Balance at end of period (shares) at Mar. 31, 2020 | 16,050,000 | ||||||
Balance at end of period at Mar. 31, 2020 | 661,896,000 | $ 16,000 | 295,940,000 | (4,867,000) | 370,807,000 | ||
Balance at beginning of period (shares) at Dec. 31, 2019 | 16,823,000 | ||||||
Balance at beginning of period at Dec. 31, 2019 | 767,232,000 | $ (5,167,000) | $ 17,000 | 367,326,000 | (216,000) | 400,105,000 | $ (5,167,000) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | (2,045,000) | ||||||
Balance at end of period (shares) at Jun. 30, 2020 | 16,071,000 | ||||||
Balance at end of period at Jun. 30, 2020 | 695,003,000 | $ 16,000 | 304,404,000 | (2,310,000) | 392,893,000 | ||
Balance at beginning of period (shares) at Mar. 31, 2020 | 16,050,000 | ||||||
Balance at beginning of period at Mar. 31, 2020 | 661,896,000 | $ 16,000 | 295,940,000 | (4,867,000) | 370,807,000 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of common stock under employee stock compensation plans, net (shares) | 21,000 | ||||||
Issuance of common stock under employee stock compensation plans, net | 1,128,000 | 1,128,000 | |||||
Share-based compensation | 7,359,000 | 7,359,000 | |||||
Unrealized net gain (loss) on available-for-sale securities, net of deferred tax | 2,742,000 | 2,742,000 | |||||
Foreign currency translation adjustment | (185,000) | (185,000) | |||||
Adjustment on reacquisition of equity due to 2023 debt extinguishment, net of tax | (23,000) | (23,000) | |||||
Net income (loss) | 22,086,000 | 22,086,000 | |||||
Balance at end of period (shares) at Jun. 30, 2020 | 16,071,000 | ||||||
Balance at end of period at Jun. 30, 2020 | 695,003,000 | $ 16,000 | 304,404,000 | (2,310,000) | 392,893,000 | ||
Balance at beginning of period (shares) at Dec. 31, 2020 | 16,080,000 | ||||||
Balance at beginning of period at Dec. 31, 2020 | 709,525,000 | $ 16,000 | 318,358,000 | (801,000) | 391,952,000 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of common stock under employee stock compensation plans, net (shares) | 572,000 | ||||||
Issuance of common stock under employee stock compensation plans, net | 20,581,000 | $ 1,000 | 20,580,000 | ||||
Share-based compensation | 8,405,000 | 8,405,000 | |||||
Unrealized net gain (loss) on available-for-sale securities, net of deferred tax | (55,000) | (55,000) | |||||
Reacquisition of equity due to 2023 debt extinguishment, net of tax | (9,086,000) | (9,086,000) | |||||
Warrant and bond hedge unwind transactions | 396,000 | 396,000 | |||||
Tax effect for 2023 Notes transactions | (2,032,000) | (2,032,000) | |||||
Net income (loss) | 18,106,000 | 18,106,000 | |||||
Balance at end of period (shares) at Mar. 31, 2021 | 16,652,000 | ||||||
Balance at end of period at Mar. 31, 2021 | 745,840,000 | $ 17,000 | 336,621,000 | (856,000) | 410,058,000 | ||
Balance at beginning of period (shares) at Dec. 31, 2020 | 16,080,000 | ||||||
Balance at beginning of period at Dec. 31, 2020 | 709,525,000 | $ 16,000 | 318,358,000 | (801,000) | 391,952,000 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Repurchase of common stock | 0 | ||||||
Net income (loss) | 48,831,000 | ||||||
Balance at end of period (shares) at Jun. 30, 2021 | 16,676,000 | ||||||
Balance at end of period at Jun. 30, 2021 | 786,517,000 | $ 17,000 | 346,578,000 | (861,000) | 440,783,000 | ||
Balance at beginning of period (shares) at Mar. 31, 2021 | 16,652,000 | ||||||
Balance at beginning of period at Mar. 31, 2021 | 745,840,000 | $ 17,000 | 336,621,000 | (856,000) | 410,058,000 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of common stock under employee stock compensation plans, net (shares) | 24,000 | ||||||
Issuance of common stock under employee stock compensation plans, net | 1,103,000 | 1,103,000 | |||||
Share-based compensation | 10,216,000 | 10,216,000 | |||||
Unrealized net gain (loss) on available-for-sale securities, net of deferred tax | (5,000) | (5,000) | |||||
Reacquisition of equity due to 2023 debt extinguishment, net of tax | (1,073,000) | (1,073,000) | |||||
Tax effect for 2023 Notes transactions | (289,000) | (289,000) | |||||
Net income (loss) | 30,725,000 | 30,725,000 | |||||
Balance at end of period (shares) at Jun. 30, 2021 | 16,676,000 | ||||||
Balance at end of period at Jun. 30, 2021 | $ 786,517,000 | $ 17,000 | $ 346,578,000 | $ (861,000) | $ 440,783,000 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 48,831 | $ (2,045) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Change in estimated fair value of contingent liabilities | (33,502) | (371) |
Depreciation and amortization of intangible assets | 25,179 | 7,869 |
Amortization of premium (discount) on investments, net | 109 | 1,198 |
Amortization of debt discount and issuance fees | 9,073 | 12,442 |
Amortization of commercial license and other economic rights | 206 | 2,733 |
Loss (gain) on debt extinguishment | 7,175 | (659) |
Share-based compensation | 18,621 | 13,012 |
Deferred income taxes | (9,766) | (8,890) |
Loss (gain) from short-term investments | (6,197) | 7,281 |
Other | 595 | (1,499) |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | (2,659) | (11,466) |
Inventory | (2,326) | 6,977 |
Accounts payable and accrued liabilities | (4,340) | 2,909 |
Income tax receivable and payable | (2,477) | 8,673 |
Deferred revenue | (14,605) | 7,268 |
Other assets and liabilities | (2,786) | (4,128) |
Net cash provided by operating activities | 31,131 | 41,304 |
Cash flows from investing activities: | ||
Purchase of short-term investments | (96,136) | (336,726) |
Proceeds from sale of short-term investments | 150,648 | 179,431 |
Proceeds from maturity of short-term investments | 34,600 | 452,405 |
Cash paid for acquisition, net of cash acquired | 0 | (15,140) |
Purchase of property and equipment | (4,794) | (791) |
Other | 135 | 2,600 |
Net cash provided by investing activities | 84,453 | 281,779 |
Cash flows from financing activities: | ||
Repurchase of 2023 Notes | (153,381) | (203,210) |
Payments under financing lease obligations | (9,188) | (1,134) |
Proceeds from convertible bond hedge settlement | 16,855 | 0 |
Payments to convertible bond holders for warrant purchases | (16,459) | 0 |
Net proceeds from stock option exercises and ESPP | 27,584 | 1,550 |
Taxes paid related to net share settlement of equity awards | (5,901) | (1,429) |
Share repurchase | 0 | (73,287) |
Payments to CVR Holders | (1,050) | (1,800) |
Net cash used in financing activities | (141,540) | (279,310) |
Effect of exchange rate changes on cash | 0 | (160) |
Net increase (decrease) in cash, cash equivalents and restricted cash | (25,956) | 43,613 |
Cash, cash equivalents and restricted cash at beginning of period | 47,963 | 72,273 |
Cash, cash equivalents and restricted cash at end of period | 22,007 | 115,886 |
Supplemental disclosure of cash flow information: | ||
Interest paid | 1,737 | 2,531 |
Taxes paid | 3,552 | 0 |
Restricted cash in other current assets | 144 | 730 |
Supplemental schedule of non-cash activity: | ||
Accrued fixed asset purchases | 359 | 292 |
Accrued inventory purchases | 12,695 | 3,553 |
Unrealized loss on AFS investments | $ (60) | $ (38) |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | Basis of Presentation and Summary of Significant Accounting Policies Basis of Presentation Our condensed consolidated financial statements include the financial statements of Ligand and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. We have included all adjustments, consisting only of normal recurring adjustments, which we considered necessary for a fair presentation of our financial results. These unaudited condensed consolidated financial statements and accompanying notes should be read together with the audited consolidated financial statements included in our 2020 Annual Report. Interim financial results are not necessarily indicative of the results that may be expected for the full year. Reclassifications Certain amounts in the prior period condensed consolidated financial statements have been reclassified to conform with the current period presentation. Specifically, “contract revenue” and “service revenue” presented in the condensed consolidated statement of operations for the three and six months ended June 30, 2021 have been combined into “contract revenue” in the condensed consolidated statement of operations to conform with the current period presentation. Significant Accounting Policies We have described our significant accounting policies in Note 1, Basis of Presentation and Summary of Significant Accounting Policies of the Notes to Consolidated Financial Statements in our 2020 Annual Report. Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires the use of estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and the accompanying notes. Actual results may differ from those estimates. Impact of COVID-19 Pandemic The current COVID-19 worldwide pandemic has presented substantial public health and economic challenges and is affecting our employees and partners, patients, communities and business operations, as well as the U.S. and global economy and financial markets. International and U.S. governmental authorities in impacted regions have taken actions in an effort to slow the spread of COVID-19, including issuing varying forms of “stay-at-home” orders, and restricting business functions outside of one’s home. In response, we have restricted in-person access to our executive offices, our administrative employees are mostly working remotely, and we have limited the number of staff in our research and development laboratories and other facilities. The continued spread of the COVID-19 pandemic and the measures taken by the governments of countries have affected, and could continue to affect, our business and the business of our partners, including future disruptions to our supply chain and the manufacture or shipment of drug substance and finished drug product for Captisol, delays by us or our partners in the initiation or enrollment of patients in clinical trials, discontinuations by patients enrolled in clinical trials, difficulties launching or commercializing products and other related activities, which could delay ongoing clinical trials, increase development costs, reduce royalty revenues and have a material adverse effect on our business, financial condition and results of operations. Several of our partners have reported that their operations have been impacted including delays in research and development programs and deprioritizing clinical trials in favor of treating patients who have contracted the virus or to prevent the spread of the virus. This may lead to clinical trial protocol deviations or to discontinuation of treatment for patients who are currently enrolled in the clinical trials being conducted by us or our partners. In addition, certain of our partners have reported negative impacts on product sales which will impact our royalty revenues. Some of our partners are working to develop drugs to treat COVID-19. For example, we are supplying Captisol to partners, including Gilead and the Gilead consortium (a consortium of manufacturing partners that Gilead is working with to bring efforts together to help maximize global supply) for remdesivir, the first FDA-approved treatment for COVID-19 for the treatment of patients with COVID-19 requiring hospitalization. In addition, certain of our OmniAb partners have initiated antibody discovery programs for the potential treatment of COVID-19. The full extent to which the COVID-19 pandemic will directly or indirectly impact our business, the businesses of our partners, our results of operations and our financial condition will depend on future developments that are highly uncertain and cannot be accurately predicted, including new information that may emerge concerning COVID-19, the actions taken to contain it or treat its impact, including the timing and extent of governments reopening or further restricting activities, the emergence and spread of COVID-19 variants, and the economic impact on local, regional, national and international markets. Accounting Standards Not Yet Adopted In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. The new guidance simplifies accounting for convertible instruments by removing major separation models required under current GAAP. This standard removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception and it also simplifies the diluted earnings per share calculation in certain areas. This standard is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020 and adoption must be as of the beginning of the Company’s annual fiscal year. We are currently evaluating the impact of this standard on our consolidated financial statements and related disclosures. We intend to adopt this standard on January 1, 2022. We do not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material impact on our condensed consolidated financial statements or disclosures. Revenue Our revenue is generated primarily from royalties on sales of products commercialized by our partners, Captisol material sales, and contract revenue for services, license fees and development, regulatory and sales based milestone payments. Royalties We receive royalty revenue on sales by our partners of products covered by patents that we own. We do not have future performance obligations under these license arrangements. We generally satisfy our obligation to grant intellectual property rights on the effective date of the contract. However, we apply the royalty recognition constraint required under the guidance for sales-based royalties which requires a sales-based royalty to be recorded when the underlying sale occurs. Therefore, royalties on sales of products commercialized by our partners are recognized in the quarter the product is sold. Our partners generally report sales information to us on a one quarter lag. Thus, we estimate the expected royalty proceeds based on an analysis of historical experience and interim data provided by our partners including their publicly announced sales. Differences between actual and estimated royalty revenues are adjusted for in the period in which they become known, typically the following quarter. Contract Revenue Our contract revenue includes service revenue, license fees and future contingent milestone based payments. We recognize service revenue for contracted R&D services performed for our customers over time. We measure our progress using an input method based on the effort we expend or costs we incur toward the satisfaction of our performance obligation. We estimate the amount of effort we expend, including the time we estimate it will take us to complete the activities, or costs we incur in a given period, relative to the estimated total effort or costs to satisfy the performance obligation. This results in a percentage that we multiply by the transaction price to determine the amount of revenue we recognize each period. This approach requires us to make estimates and use judgement. If our estimates or judgements change over the course of the collaboration, they may affect the timing and amount of revenue that we recognize in the current and future periods. We include contingent milestone based payments in the estimated transaction price when there is a basis to reasonably estimate the amount of the payment. These estimates are based on historical experience, anticipated results and our best judgment at the time. If the contingent milestone based payment is sales-based, we apply the royalty recognition constraint and record revenue when the underlying sale has taken place. Significant judgments must be made in determining the transaction price for our sales of intellectual property. Because of the risk that products in development with our partners will not reach development based milestones or receive regulatory approval, we generally recognize any contingent payments that would be due to us upon or after the development milestone or regulatory approval. Captisol Sales We recognize revenue when control of Captisol material is transferred to our customers in an amount that reflects the consideration we expect to receive from our customers in exchange for those products. This process involves identifying the contract with a customer, determining the performance obligations in the contract, determining the contract price, allocating the contract price to the distinct performance obligations in the contract, and recognizing revenue when the performance obligations have been satisfied. A performance obligation is considered distinct from other obligations in a contract when it provides a benefit to the customer either on its own or together with other resources that are readily available to the customer and is separately identified in the contract. We consider a performance obligation satisfied once we have transferred control of the product, meaning the customer has the ability to use and obtain the benefit of the Captisol material or intellectual property license right. We recognize revenue for satisfied performance obligations only when we determine there are no uncertainties regarding payment terms or transfer of control. We have elected to recognize the cost for freight and shipping when or after control over Captisol material has transferred to the customer as an expense in cost of Captisol. Sales tax and other taxes we collect concurrent with revenue-producing activities are excluded from revenue. We expense incremental costs of obtaining a contract when incurred if the expected amortization period of the asset that we would have recognized is one year or less or the amount is immaterial. We did not incur any incremental costs of obtaining a contract during the periods reported. Deferred Revenue Depending on the terms of the arrangement, we may also defer a portion of the consideration received because we have to satisfy a future obligation. We use an observable price to determine the stand-alone selling price for separate performance obligations or a cost plus margin approach when one is not available. The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables (contract assets), and customer advances and deposits (contract liabilities) on the consolidated balance sheet. Except for royalty revenue and certain service revenue, we generally receive payment at the point we satisfy our obligation or soon after. Therefore, we do not generally carry a contract asset balance. Any fees billed in advance of being earned are recorded as deferred revenue. During the three and six months ended June 30, 2021, the amount recognized as revenue that was previously deferred was $10.3 million, and $16.1 million, respectively. During the three and six months ended June 30, 2020, the amount recognized as revenue that was previously deferred was $2.0 million and $2.4 million, respectively. Disaggregation of Revenue The following table represents disaggregation of royalties, Captisol and contract revenue (in thousands): Three months ended Six months ended June 30, June 30, 2021 2020 2021 2020 Royalties Kyprolis $ 5,440 $ 5,481 $ 9,727 $ 9,886 Evomela 2,193 1,199 4,526 2,775 Other 983 501 1,475 1,085 $ 8,616 $ 7,181 $ 15,728 $ 13,746 Captisol $ 62,509 $ 24,468 $ 93,781 $ 45,577 Contract revenue Service Revenue $ 7,360 $ 4,582 $ 12,822 $ 7,939 License Fees 1,050 660 2,093 1,635 Milestone 3,600 3,472 12,017 3,806 Other 1,540 1,057 3,384 1,878 $ 13,550 $ 9,771 $ 30,316 $ 15,258 Total $ 84,675 $ 41,420 $ 139,825 $ 74,581 Short-term Investments Our short-term investments consist of the following at June 30, 2021 and December 31, 2020 (in thousands): June 30, 2021 December 31, 2020 Amortized cost Gross unrealized gains Gross unrealized losses Estimated fair value Amortized cost Gross unrealized gains Gross unrealized losses Estimated fair value Bank deposits $ 33,560 $ 13 $ (2) $ 33,571 $ 84,120 $ 35 $ (1) $ 84,154 Corporate bonds 25,965 62 (2) 26,025 30,512 99 (1) 30,610 Agency bonds 2,500 — (1) 2,499 4,499 2 — 4,501 Commercial paper 19,258 12 — 19,270 45,459 27 (1) 45,485 Corporate equity securities 5,807 172 (310) 5,669 4,466 360 (1,388) 3,438 Mutual fund 151,949 53 — 152,002 151,512 386 — 151,898 Treasury bill — — — — 3,999 — — 3,999 Warrants — 713 — 713 — 393 — 393 $ 239,039 $ 1,025 $ (315) $ 239,749 $ 324,567 $ 1,302 $ (1,391) $ 324,478 Viking common stock 40,223 32,763 Viking warrants — 6,326 Total short-term investments $ 279,972 $ 363,567 During the six months ended June 30, 2021, we exercised all outstanding Viking warrants to purchase 1.5 million shares of Viking's common stock at an exercise price of $1.50 per share. As of June 30, 2021, we have zero Viking warrants outstanding. Gain (loss) from short-term investments in our condensed consolidated statements of operations includes both realized and unrealized gain (loss) from our short-term investments in public equity and warrant securities. Allowances are recorded for available-for-sale debt securities with unrealized losses. This limits the amount of credit losses that can be recognized for available-for-sale debt securities to the amount by which carrying value exceeds fair value and requires the reversal of previously recognized credit losses if fair value increases. The provisions of the credit losses standard did not have a material impact on our available-for-sale debt securities during the three and six months ended June 30, 2021. The following table summarizes our available-for-sale debt securities by contractual maturity (in thousands): June 30, 2021 Amortized Cost Fair Value Within one year $ 57,997 $ 58,050 After one year through five years 23,286 23,316 Total $ 81,283 $ 81,366 Our investment policy is capital preservation and we only invested in U.S.-dollar denominated investments. We held a total of seven positions which were in an unrealized loss position as of June 30, 2021. We believe that we will collect the principal and interest due on our debt securities that have an amortized cost in excess of fair value. The unrealized losses are largely due to changes in interest rates and not to unfavorable changes in the credit quality associated with these securities that impacted our assessment on collectability of principal and interest. We do not intend to sell these securities and it is not more-likely-than-not that we will be required to sell these securities before the recovery of the amortized cost basis. Accordingly, no credit losses were recognized for the three and six months ended June 30, 2021. Accounts Receivable and Allowance for Credit Losses Our accounts receivable arise primarily from sales on credit to customers. We establish an allowance for credit losses to present the net amount of accounts receivable expected to be collected. The allowance is determined by using the loss-rate method, which requires an estimation of loss rates based upon historical loss experience adjusted for factors that are relevant to determining the expected collectability of accounts receivable. Some of these factors include macroeconomic conditions that correlate with historical loss experience, delinquency trends, aging behavior of receivables and credit and liquidity quality indicators for industry groups, customer classes or individual customers. During the three and six months ended June 30, 2021, we considered the current and expected future economic and market conditions including, but not limited to, the anticipated unfavorable impacts of the COVID-19 pandemic on our business and recorded an adjustment of $0.04 million and $0.1 million of allowance for credit losses, respectively, as of June 30, 2021. Inventory Inventory, which consists of prepaid inventory and finished goods, is stated at the lower of cost or net realizable value. We determine cost using the first-in, first-out method or the specific identification method. As of June 30, 2021, we have made advanced payments for inventory from our supplier of Captisol totaling $50.2 million. We have applied credits for such inventory purchases of $15.8 million and will utilize the remaining advanced payments to offset a portion of the purchase price for future Captisol purchases. Goodwill and Other Identifiable Intangible Assets Goodwill and other identifiable intangible assets consist of the following (in thousands): June 30, December 31, 2021 2020 Indefinite-lived intangible assets Goodwill $ 190,517 $ 189,662 Definite lived intangible assets Complete technology 277,980 277,740 Less: accumulated amortization (71,276) (63,600) Trade name 2,642 2,642 Less: accumulated amortization (1,378) (1,312) Customer relationships 40,700 40,700 Less: accumulated amortization (16,932) (15,597) Contractual relationships 362,000 362,000 Less: accumulated amortization (21,730) (7,243) Total goodwill and other identifiable intangible assets, net $ 762,523 $ 784,992 Commercial License and Other Economic Rights Commercial license and other economic rights consist of the following (in thousands): June 30, 2021 December 31, 2020 Gross Adjustments (1) Net Gross Adjustments (2) Net Aziyo and CorMatrix $ 17,696 $ (9,470) $ 8,226 $ 17,696 $ (9,588) $ 8,108 Selexis and Dianomi 10,602 (8,190) 2,412 10,602 (7,731) 2,871 Total $ 28,298 $ (17,660) $ 10,638 $ 28,298 $ (17,319) $ 10,979 (1) Amounts represent accumulated amortization to principal of $11.7 million and credit loss adjustments of $6.0 million as of June 30, 2021. (2) Amounts represent accumulated amortization to principal of $11.3 million and credit loss adjustments of $6.0 million as of December 31, 2020. Commercial license and other economics rights represent a portfolio of future milestone and royalty payment rights acquired from Selexis in April 2013 and April 2015, CorMatrix in May 2016, and Dianomi in January 2019. Commercial license rights acquired are accounted for as financial assets and other economic rights are accounted for as funded research and development as further discussed below and in Note 1, Basis of Presentation and Summary of Significant Accounting Policies of the Notes to Consolidated Financial Statements in our 2020 Annual Report. In May 2017, we entered into a Royalty Agreement with Aziyo pursuant to which we will receive royalties from certain marketed products that Aziyo acquired from CorMatrix. We account for the Aziyo commercial license right as a financial asset, and in accordance with ASC 310, Receivables , we amortize the commercial license right using the effective interest method whereby we forecast expected cash flows over the term of the arrangement to arrive at an annualized effective interest. The annual effective interest associated with the forecasted cash flows from the Royalty Agreement with Aziyo as of June 30, 2021 is 23%. Revenue is calculated by multiplying the carrying value of the commercial license right by the effective interest. The payments received during the six months ended June 30, 2021 were accordingly allocated between revenue and the amortization of the commercial license rights. Prior to 2020, we accounted for commercial license rights related to developmental pipeline products such as Selexis and Dianomi on a non-accrual basis. We continue to account for commercial license rights related to Dianomi on a non-accrual basis as of June 30, 2021, but starting in 2020, given the expected cash flow from the Selexis program, we started to account for the Selexis commercial license right as a financial asset in accordance with ASC 310, and amortize the commercial license right using the effective interest method whereby we forecast expected cash flows over the term of the arrangement to arrive at an annualized effective interest. The annual effective interest associated with the forecasted cash flows from the royalty agreement with Selexis as of June 30, 2021 is 21%. Revenue is calculated by multiplying the carrying value of the commercial license right by the effective interest. The payments received during the six months ended June 30, 2021 were accordingly allocated between revenue and the amortization of the commercial license rights. We recorded a $5.5 million pre-tax reserve for credit losses upon adoption of the credit losses standard (ASU 2016-13) on January 1, 2020. We estimated the credit losses at the individual asset level by considering the performance against the programs, the company operating performance and the macroeconomic forecast. In addition, we have judgmentally applied credit loss risk factors to the future expected payments with consideration given to the timing of the payment. Given the higher inherent credit risk associated with longer term receivables, we applied a lower risk factor to the earlier years and progressively higher risk factors to the later years. During the six months ended June 30, 2021, we further considered the current and expected future economic and market conditions surrounding novel coronavirus (COVID-19) pandemic and concluded no further adjustment was needed on the allowance for credit losses as of June 30, 2021. Accrued Liabilities Accrued liabilities consist of the following (in thousands): June 30, December 31, 2021 2020 Compensation $ 3,684 $ 8,810 Professional fees 977 977 Amounts owed to former licensees 446 421 Royalties owed to third parties 52 693 Return reserve 105 687 Acquisition related liabilities 1,500 1,500 Subcontractor — 733 Supplier 681 604 Accrued interest 295 464 Other 2,367 3,641 Total accrued liabilities $ 10,107 $ 18,530 Share-Based Compensation Share-based compensation expense for awards to employees and non-employee directors is a non-cash expense and is recognized on a straight-line basis over the vesting period until the last tranche vests. The following table summarizes share-based compensation expense recorded as components of research and development expenses and general and administrative expenses for the periods indicated (in thousands): Three months ended Six months ended June 30, June 30, 2021 2020 2021 2020 SBC - Research and development expenses $ 4,556 $ 3,019 $ 8,495 $ 5,416 SBC - General and administrative expenses 5,660 4,340 10,126 7,596 $ 10,216 $ 7,359 $ 18,621 $ 13,012 The fair-value for options that were awarded to employees and directors was estimated at the date of grant using the Black-Scholes option valuation model with the following weighted-average assumptions: Three months ended Six months ended June 30, June 30, 2021 2020 2021 2020 Risk-free interest rate 0.9% 0.4% 0.5% 1.1% Dividend yield — — — — Expected volatility 54% 69% 62% 55% Expected term 5.5 5.1 5.0 4.8 A limited amount of performance-based restricted stock units (PSUs) contain a market condition based on our relative total shareholder return ranked on a percentile basis against the NASDAQ Biotechnology Index over a three-year performance period, with a range of 0% to 200% of the target amount granted to be issued under the award. Share-based compensation cost for these PSUs is measured using the Monte-Carlo simulation valuation model and is not adjusted for the achievement, or lack thereof, of the performance conditions. Net Income (Loss) Per Share Basic net income (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted net income per share is computed based on the sum of the weighted average number of common shares and potentially dilutive common shares outstanding during the period. Diluted net loss per share is computed based on the sum of the weighted average number of common shares outstanding during the period. Potentially dilutive common shares consist of shares issuable under the 2023 Notes, stock options and restricted stock. The 2023 Notes have a dilutive impact when the average market price of our common stock exceeds the applicable conversion price of the respective notes. It is our intent and policy to settle conversions through combination settlement, which involves payment in cash equal to the principal portion and delivery of shares of common stock for the excess of the conversion value over the principal portion. Potentially dilutive common shares from stock options and restricted stock are determined using the average share price for each period under the treasury stock method. In addition, the following amounts are assumed to be used to repurchase shares: proceeds from exercise of stock options and the average amount of unrecognized compensation expense for the awards. See Note 4, Convertible Senior Notes and Note 6, Stockholders’ Equity . The following table presents the calculation of weighted average shares used to calculate basic and diluted earnings per share (in thousands): Three months ended Six months ended June 30, June 30, 2021 2020 2021 2020 Weighted average shares outstanding: 16,659 16,055 16,548 16,292 Dilutive potential common shares: Restricted stock 69 40 90 — Stock options 444 599 572 — Shares used to compute diluted income per share 17,172 16,694 17,210 16,292 Potentially dilutive shares excluded from calculation due to anti-dilutive effect 5,087 7,832 4,684 8,988 For the six months ended June 30, 2020, all of the 0.6 million weighted average shares of outstanding equity awards as of June 30, 2020 were anti-dilutive due to the net loss for the period. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Assets and Liabilities Measured on a Recurring Basis The following table presents the hierarchy for our assets and liabilities measured at fair value (in thousands): June 30, 2021 December 31, 2020 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets: Short-term investments, excluding Viking (1) $ 5,669 $ 233,368 $ 712 $ 239,749 $ 3,438 $ 320,647 $ 393 $ 324,478 Investment in Viking common stock 40,223 — — 40,223 32,763 — — 32,763 Investment in Viking warrants (2) — — — — 6,326 — — 6,326 Total assets $ 45,892 $ 233,368 $ 712 $ 279,972 $ 42,527 $ 320,647 $ 393 $ 363,567 Liabilities: Crystal contingent liabilities (3) $ — $ — $ 800 $ 800 $ — $ — $ 800 $ 800 CyDex contingent liabilities — — 376 376 — — 508 508 Metabasis contingent liabilities (4) — 3,930 — 3,930 — 3,821 — 3,821 Icagen contingent liabilities (5) — — 5,625 5,625 — — 6,404 6,404 Pfenex contingent liabilities (6) — — 3,800 3,800 — — 37,600 37,600 xCella contingent liabilities (7) — — 240 240 — — — — Amounts owed to former licensor 31 — — 31 60 — — 60 Total liabilities $ 31 $ 3,930 $ 10,841 $ 14,802 $ 60 $ 3,821 $ 45,312 $ 49,193 1. Excluding our investment in Viking, our short-term investments in marketable debt and equity securities are classified as available-for-sale securities based on management's intentions and are at level 2 of the fair value hierarchy, as these investment securities are valued based upon quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market. Short-term investments in mutual funds are valued at their net asset value (NAV) on the last day of the period. We have classified marketable securities with original maturities of greater than one year as short-term investments based upon our ability and intent to use any and all of those marketable securities to satisfy the liquidity needs of our current operations. In addition, we have investment in warrants resulting from Seelos Therapeutics Inc. milestone payments that were settled in shares during the first quarter of 2019 and are at level 3 of the fair value hierarchy, based on Black Scholes value estimated by management on the last day of the period. 2. Investment in Viking warrants, which we received as a result of Viking’s partial repayment of the Viking note receivable and our purchase of Viking common stock and warrants in April 2016, are classified as level 1 as the fair value is determined using quoted market prices in active markets for the same securities. The change of the fair value is recorded in "Gain (loss) from short-term investments" in our condensed consolidated statement of operations. During the six months ended June 30, 2021, we exercised all of the outstanding Viking warrants. 3. The fair value of Crystal contingent liabilities was determined using a probability weighted income approach. Most of the contingent payments are based on development or regulatory milestones as defined in the merger agreement with Crystal. The fair value is subjective and is affected by changes in inputs to the valuation model including management’s estimates regarding the timing and probability of achievement of certain developmental and regulatory milestones. Changes in these estimates may materially affect the fair value. 4. In connection with our acquisition of Metabasis in January 2010, we issued Metabasis stockholders four tradable CVRs, one CVR from each of four respective series of CVR, for each Metabasis share. The CVRs entitle Metabasis stockholders to cash payments as frequently as every six months as cash is received by us from proceeds from the sale or partnering of any of the Metabasis drug development programs, among other triggering events. The liability for the CVRs is determined using quoted prices in a market that is not active for the underlying CVR. The carrying amount of the liability may fluctuate significantly based upon quoted market prices and actual amounts paid under the agreements may be materially different than the carrying amount of the liability. Several of the Metabasis drug development programs have been outlicensed to Viking, including VK2809. VK2809 is a novel selective TR-β agonist with potential in multiple indications, including hypercholesterolemia, dyslipidemia, NASH, and X-ALD. Under the terms of the agreement with Viking, we may be entitled to up to $375 million of development, regulatory and commercial milestones and tiered royalties on potential future sales including a $10 million payment upon initiation of a Phase 3 clinical trial. 5. The fair value of Icagen contingent liabilities was determined using a probability weighted income approach. Most of the contingent payments are based on certain revenue milestones as defined in the asset purchase agreement with Icagen. The fair value is subjective and is affected by changes in inputs to the valuation model including management’s estimates regarding the timing and probability of achievement of certain developmental and regulatory milestones. Changes in these estimates may materially affect the fair value. During the six months ended June 30, 2021, we paid $1.1 million contingent liability based on revenue milestones to former Icagen shareholders. 6. The fair value of Pfenex contingent liabilities was determined using a probability-adjusted income approach. These cash flows were then discounted to present value using a discount rate based on the market participants' cost of debt reflective of the Company. During the three and six months ended June 30, 2021, we reduced the contingent liability by $34.1 million and $33.8 million, respectively, primarily due to the lower probability of achieving the specific development and regulatory milestone by December 31, 2021 as defined by the Pfenex CVR. See further detail on Pfenex CVR in Note 3, Acquisitions . 7. The fair value of xCella contingent liabilities is determined when it is probable that the earnout liability will occur and the amount can be reasonably estimated. Management concluded that no earnout liability would be recognized at the acquisition date in September 2020. During the first quarter of 2021, management recorded an earnout liability to be allocated to the cost of the acquired assets due to contingencies being met as part of the acquisition agreement. A reconciliation of the level 3 financial instruments as of June 30, 2021 is as follows (in thousands): Fair value of level 3 financial instruments as of December 31, 2020 $ 45,312 Payments to CVR holders and other contingent payments (1,050) Fair value adjustments to contingent liabilities (33,661) Contingent liabilities from xCella asset acquisition 240 Fair value of level 3 financial instruments as of June 30, 2021 $ 10,841 Assets Measured on a Non-Recurring Basis We apply fair value techniques on a non-recurring basis associated with valuing potential impairment losses related to our goodwill, indefinite-lived intangible assets and long-lived assets. We evaluate goodwill and indefinite-lived intangible assets annually for impairment and whenever circumstances occur indicating that goodwill might be impaired. We determine the fair value of our reporting unit based on a combination of inputs, including the market capitalization of Ligand, as well as Level 3 inputs such as discounted cash flows, which are not observable from the market, directly or indirectly. We determine the fair value of our indefinite-lived intangible assets using the income approach based on Level 3 inputs. During the second quarter of 2021, in connection with the Pfenex CVR fair value evaluation, we also evaluated the related indefinite-lived contractual relationship intangible for recoverability and concluded there was no impairment. |
Acquisitions
Acquisitions | 6 Months Ended |
Jun. 30, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions | Acquisitions Pfenex Acquisition On October 1, 2020, we acquired Pfenex, which develops next-generation and novel protein therapeutics to improve existing therapies and create new therapies for biological targets linked to critical, unmet diseases using a protein expression technology platform. The preliminary purchase price of $465.1 million included $429.6 million cash consideration paid upon acquisition, and a contingent CVR payment of up to $77.8 million in cash based on a certain specified milestone with an estimated initial fair value of $37.0 million. The CVR will only be paid in full if the milestone is achieved by December 31, 2021. The amount of the CVR included in the purchase price was reduced by $1.5 million that was determined to be post-combination expense. The fair value of the CVR liability was determined using a probability-adjusted income approach. These cash flows were then discounted to present value using a discount rate based on market participants' cost of debt reflective of the Company, which was 7.1%. The liability is periodically assessed based on events and circumstances related to the underlying milestone, and any change in fair value is recorded in our consolidated statements of operations. In connection with the acquisition, a portion of Pfenex's equity awards that were outstanding and unvested prior to the acquisition became fully vested per the terms of the merger agreement. The acceleration of vesting required us to allocate the fair value of the equity attributable to pre-combination service to the purchase price and the remaining amount was considered our post-combination expense. We paid $17.3 million in cash for equity compensation, which is attributable to pre-combination services and is reflected as a component of the total purchase price paid of $429.6 million. In addition, the fair value of equity compensation attributable to the post-combination service period was $8.7 million. These amounts were associated with the accelerated vesting of stock options previously granted to Pfenex employees and were fully paid in cash, which was recognized as general and administrative expenses during the fourth quarter of 2020. The following table sets forth an allocation of the preliminary purchase price to the identifiable tangible and intangible assets acquired and liabilities assumed, with the excess recorded to goodwill (in thousands): Cash $ 51,407 Restricted cash 200 Accounts and unbilled receivables 1,359 Property and equipment, net 7,823 Right-of-use asset 3,070 Other assets 1,338 Intangibles acquired 385,000 Goodwill (1) 91,837 Accounts payable (6,814) Accrued liabilities (8,455) Deferred revenue (3,908) Lease liabilities (3,070) Other liabilities (1,382) Deferred tax liabilities, net (53,296) $ 465,109 (1) Goodwill represents the excess of the purchase price over the preliminary fair value of the underlying assets acquired and liabilities assumed. Goodwill is attributable to the assembled workforce of experienced personnel at Pfenex and expected synergies. None of the goodwill is expected to be deductible for tax purposes. Acquired intangibles include $362 million of contractual relationships and $23 million of core technology. The fair values of the contractual relationships were based on the discounted cash flow method that estimated the present value of the potential royalties, milestones, collaboration and product revenue streams derived from the licensing of the related technologies over the estimated contractual relationship period. The fair value of the contractual relationships is being amortized on a straight-line basis over the weighted average estimated useful life of 12.9 years. The fair values of the acquired technologies were based on the discounted cash flow method that estimated the present value of the potential royalties, milestones, collaboration and product revenue streams derived from the licensing of the related technologies over the estimated useful lives. These projected cash flows were discounted to present value using discount rate, which varies from 12% to 15%. The total acquired intangibles are being amortized on a straight-line basis over the weighted average estimated useful life of 13.0 years. The estimated fair values of assets acquired and liabilities assumed, including deferred tax assets and liabilities, and purchased intangibles are provisional. The accounting for these amounts falls within the measurement period and therefore we may adjust these provisional amounts to reflect new information obtained about facts and circumstances that existed as of the acquisition date. The following summary presents our unaudited pro forma consolidated results of operations for the three and six months ended June 30, 2020 as if the Pfenex acquisition had occurred on January 1, 2020, which gives effect to certain transaction accounting adjustments, including amortization of acquired intangibles and share based compensation expense for retained Pfenex employees. The pro forma financial information is not necessarily indicative of the operating results that would have occurred had the acquisition been consummated as of the date indicated, nor is it necessarily indicative of future operating results (in thousands, except per share amounts): Three months ended Six months ended Revenue $ 42,201 $ 76,044 Net income (loss) $ 7,435 $ (30,505) Net income (loss) per common share: Basic $ 0.46 $ (1.87) Diluted $ 0.45 $ (1.87) Taurus Acquisition On September 9, 2020, we acquired Taurus, which discovers and develops novel antibodies from immunized cows and cow-derived libraries. The purchase price of $5.1 million included $4.6 million in cash, and a $0.5 million holdback to satisfy indemnification obligations which will be settled by September 2021. We also issued nontransferable CVRs for up to $4.5 million tied to partnered and internal research and development and for up to $25.0 million as a 25% share of post-clinical Taurus product revenues (including milestone payments) received by us. We evaluated this acquisition in accordance with ASC 805, Business Combinations , to discern whether the assets and operations of Taurus met the definition of a business. We concluded that substantially all of the fair value of the gross assets acquired is concentrated in the acquired core technology. Accordingly, we accounted for this transaction as an asset acquisition. Of the $5.1 million consideration transferred, we recognized (1) $0.05 million of tangible assets acquired, and (2) $5.0 million of core completed technology intangibles acquired. The core technology is being amortized on a straight-line basis over the estimated useful life of 10 years. We account for the CVRs in accordance with ASC 450, Contingencies , when the contingency is resolved and the liability becomes payable. None of the CVRs are recognized as of June 30, 2021. xCella Acquisition On September 8, 2020, we acquired xCella, an antibody discovery company. We paid $7.1 million in cash (including a $0.5 million holdback to satisfy indemnification obligations which will be settled by September 2021), and issued earnout rights for up to $5.0 million tied to our use of the xCella technology for partnered research and development and for up to $25.75 million as a 25% share of any future milestone payments we received under a certain existing xCella partner arrangement. We evaluated this acquisition in accordance with ASC 805, Business Combinations , to discern whether the assets and operations of xCella met the definition of a business. We concluded that substantially all of the fair value of the gross assets acquired is concentrated in the acquired core technology. Accordingly, we accounted for this transaction as an asset acquisition. Of the $7.1 million consideration transferred, we recognized (1) $0.2 million of tangible assets acquired, (2) $(0.1) million of liabilities assumed, (3) $7.8 million of core completed technology acquired, and (4) $(0.8) million of deferred tax liability. The core technology is being amortized on a straight-line basis over the estimated useful life of 15 years. We account for the earnout rights in accordance with ASC 450, Contingencies , when the contingency is resolved and the liability becomes payable. None of the earnout rights are recognized as of the acquisition date. During the three months ended June 30, 2021, no contingencies were resolved during the period. During the six months ended June 30, 2021, we recognized $0.2 million in earnout rights when certain contingencies were resolved during the period. Icagen Acquisition On April 1, 2020, we acquired the core assets, including its partnered programs and ion channel technology, from Icagen and certain of its affiliates. The acquisition was accounted for as a business combination and we applied the acquisition method of accounting. Accordingly, we recorded the tangible and intangible assets acquired and liabilities assumed at their estimated fair values as of the applicable date of acquisition. We did not incur any material acquisition-related costs. The purchase price of $19.9 million included $15.1 million cash consideration paid upon acquisition, and a contingent earn-out payment of up to $25.0 million of cash payments based on certain revenue milestones with an estimated fair value of $4.8 million. The fair value of the earn-out liability was determined using a probability weighted income approach incorporating the estimated future cash flows from expected future milestones. These cash flows were then discounted to present value using a discount rate based on the market participants' cost of debt reflective of Icagen. Refer to Note 2, Fair Value Measurement , for further discussion. The liability will be periodically assessed based on events and circumstances related to the underlying milestones, and any change in fair value will be recorded in our consolidated statements of operations. The carrying amount of the liability may fluctuate significantly and actual amount paid may be materially different than the carrying amount of the liability. As the acquisition is not considered significant, pro forma information has not been provided. The results of Icagen have been included in our results of operations since the date of acquisition. The allocation of the purchase price consisted of (1) $1.8 million of fair value of tangible assets acquired, (2) $(0.8) million of liabilities assumed, (3) $12.8 million of acquired intangibles, (4) $(3.7) million of deferred revenue in connection with assumed performance obligations under a collaboration agreement, (5) $0.8 million of deferred tax asset associated with the deferred revenue, and (6) $9.0 million of goodwill, the majority of which is deductible for tax purposes. Acquired intangibles include $11.1 million of customer relationships and $1.7 million of core technology. The fair values of the customer relationships were based on a discounted cash flow analysis incorporating the estimated future cash flows from these relationships during the contractual term. These cash flows were then discounted to present value using a discount rate of 17%. The fair value of the customer relationships is being amortized on a straight-line basis over the weighted average estimated useful life of 9.6 years. The fair value of the core technology was based on the discounted cash flow method that estimated the present value of the potential royalties, milestones, and collaboration revenue streams derived from the licensing of the related technologies. These projected cash flows were discounted to present value using a discount rate of 17%. The fair value of the core technology is being amortized on a straight-line basis over the estimated useful life of 10 years. The total acquired intangibles are being amortized on a straight-line basis over the estimated useful life of 9.7 years. |
Convertible Senior Notes
Convertible Senior Notes | 6 Months Ended |
Jun. 30, 2021 | |
Debt Disclosure [Abstract] | |
Convertible Senior Notes | Convertible Senior Notes 0.75% Convertible Senior Notes due 2023 In May 2018, we issued $750.0 million aggregate principal amount of 0.75% convertible senior notes. The net proceeds from the offering, after deducting the initial purchasers' discount and offering expenses, were approximately $733.1 million. The 2023 Notes will be convertible into cash, shares of common stock, or a combination of cash and shares of common stock, at our election, based on an initial conversion rate, subject to adjustment, of 4.0244 shares per $1,000 principal amount of the 2023 Notes which represents an initial conversion price of approximately $248.48 per share. Holders of the 2023 Notes may convert the notes at any time prior to the close of business on the business day immediately preceding November 15, 2022, under any of the following circumstances: (1) during any fiscal quarter (and only during such fiscal quarter) commencing after September 30, 2018, if, for at least 20 trading days (whether or not consecutive) during the 30 consecutive trading day period ending on the last trading day of the immediately preceding fiscal quarter, the last reported sale price of our common stock on such trading day is greater than 130% of the conversion price on such trading day; (2) during the five business day period immediately following any 10 consecutive trading day period, in which the trading price per $1,000 principal amount of notes was less than 98% of the product of the last reported sale price of our common stock on such trading day and the conversion rate on each such trading day; or (3) upon the occurrence of certain specified corporate events as specified in the indenture governing the notes. The notes will have a dilutive effect to the extent the average market price per share of common stock for a given reporting period exceeds the conversion price of $248.48. As of June 30, 2021, the “if-converted value” did not exceed the principal amount of the 2023 Notes. In connection with the issuance of the 2023 Notes, we incurred $16.9 million of issuance costs, which primarily consisted of underwriting, legal and other professional fees. The portion of these costs allocated to the liability component totaling $13.7 million is amortized to interest expense using the effective interest method over the five year expected life of the 2023 Notes. It is our intent and policy to settle conversions through combination settlement, which essentially involves payment in cash equal to the principal portion and delivery of shares of common stock for the excess of the conversion value over the principal portion. During the six months ended June 30, 2021, we repurchased $149.6 million in principal of the 2023 Notes for $153.7 million in cash, including accrued interest of $0.3 million. We accounted for the repurchase as a debt extinguishment, which resulted in (1) a loss of $7.2 million reflected in other income (expense), net, in our condensed consolidated statement of operations for the six months ended June 30, 2021, (2) a $13.5 million reduction in debt discount, and (3) a $10.2 million reduction to additional paid in capital, net of tax, related to the reacquisition of the equity component in our condensed consolidated balance sheet as of June 30, 2021. Convertible Bond Hedge and Warrant Transactions In conjunction with the 2023 Notes, in May 2018, we entered into convertible bond hedges and sold warrants covering 3,018,327 shares of our common stock to minimize the impact of potential dilution to our common stock and/or offset the cash payments we are required to make in excess of the principal amount upon conversion of the 2023 Notes. The convertible bond hedges have an exercise price of $248.48 per share and are exercisable when and if the 2023 Notes are converted. We paid $140.3 million for these convertible bond hedges. If upon conversion of the 2023 Notes, the price of our common stock is above the exercise price of the convertible bond hedges, the counterparties will deliver shares of common stock and/or cash with an aggregate value approximately equal to the difference between the price of common stock at the conversion date and the exercise price, multiplied by the number of shares of common stock related to the convertible bond hedge transaction being exercised. The convertible bond hedges and warrants described below are separate transactions entered into by us and are not part of the terms of the 2023 Notes. Holders of the 2023 Notes and warrants will not have any rights with respect to the convertible bond hedges. Concurrently with the convertible bond hedge transactions, we entered into warrant transactions whereby we sold warrants covering approximately 3,018,327 shares of common stock with an exercise price of approximately $315.38 per share, subject to certain adjustments. We received $90.0 million for these warrants. The warrants have various expiration dates ranging from August 15, 2023 to February 6, 2024. The warrants will have a dilutive effect to the extent the market price per share of common stock exceeds the applicable exercise price of the warrants, as measured under the terms of the warrant transactions. The common stock issuable upon exercise of the warrants will be in unregistered shares, and we do not have the obligation and do not intend to file any registration statement with the SEC registering the issuance of the shares under the warrants. In January 2021, we entered into amendments with Barclays Bank PLC, Deutsche Bank AG, and Goldman Sachs & Co. LLC to the convertible note hedges transactions we initially entered into in connection with the issuance of the 2023 Notes. The amendments provide that the options under the convertible note hedges corresponding to such repurchased 2023 Notes will remain outstanding notwithstanding such repurchase. In March 2021, in connection with the repurchases of $104.5 million in principal of the 2023 Notes for $109.1 million in cash, including accrued interest of $0.2 million, during the quarter ended March 31, 2021, we entered into Warrant Early Unwind Agreements and Bond Hedge Unwind Agreements with Barclays Bank PLC, Deutsche Bank AG, and Goldman Sachs & Co. LLC to unwind a portion of the convertible note hedges transactions we initially entered into in connection with the issuance of the 2023 Notes. We paid $16.5 million as part of the Warrant Early Unwind Agreements reducing the number of shares covered by the warrants from 3,018,327 to 2,597,750. We received $16.9 million as part of the Bond Hedge Early Unwind Agreements reducing the number of options under the convertible bond hedges to 645,500. These unwind transactions resulted in a $0.4 million net increase in additional paid-in-capital in our condensed consolidated balance sheet as of March 31, 2021. The following table summarizes information about the 2023 Notes (in thousands): June 30, 2021 December 31, 2020 Principal amount of the 2023 Notes outstanding $ 345,729 $ 495,280 Unamortized discount (including unamortized debt issuance cost) (30,411) (52,987) Total long-term portion of notes payable $ 315,318 $ 442,293 Carrying value of equity component of the 2023 Notes $ 27,776 $ 48,397 Fair value of the 2023 Notes outstanding (Level 2) $ 341,687 $ 466,053 |
Income Tax
Income Tax | 6 Months Ended |
Jun. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Tax | Income TaxOur effective tax rate may vary from the U.S. federal statutory tax rate due to the change in the mix of earnings in various state jurisdictions with different statutory rates, benefits related to tax credits, and the tax impact of non-deductible expenses, stock award activities and other permanent differences between income before income taxes and taxable income. The effective tax rate for the three and six months ended June 30, 2021 was 7.7% and (25.0)%, respectively. The variance from the U.S. federal statutory tax rate of 21% for the three and six months ended June 30, 2021 was significantly impacted by tax benefits related to (1) a $34.1 million Pfenex CVR adjustment recorded during the second quarter of 2021 due to the lower probability of achieving the specific development and regulatory milestone by December 31, 2021 as defined by the Pfenex CVR, and (2) net excess tax windfalls from share-based compensation resulting from increased stock option exercise activity, stock award vesting and appreciation of our stock price during the period. The effective tax rate for the three and six months ended June 30, 2020 was 21.5% and 10.9%, respectively. The variances from the U.S. federal statutory tax rate of 21% for the three and six months ended June 30, 2020 were primarily attributable to the mix of earnings in the jurisdictions with lower statutory rates than the U.S. offset by tax deductions related to stock award activities and tax deductions related to foreign derived intangible income tax credits. |
Stockholders' Equity
Stockholders' Equity | 6 Months Ended |
Jun. 30, 2021 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders’ Equity We grant options and awards to employees and non-employee directors pursuant to a stockholder approved stock incentive plan, which is described in further detail in Note 9, Stockholders’ Equity , of the Notes to Consolidated Financial Statements in our 2020 Annual Report. The following is a summary of our stock option and restricted stock activity and related information: Stock Options Restricted Stock Awards Shares Weighted-Average Exercise Price Shares Weighted-Average Grant Date Fair Value Balance as of December 31, 2020 2,561,822 $ 85.59 206,202 $ 106.88 Granted 318,381 $ 164.30 158,456 $ 171.44 Options exercised/RSUs vested (533,451) $ 52.00 (95,607) $ 126.49 Forfeited (83,489) $ 106.98 (6,790) $ 126.23 Balance as of June 30, 2021 2,263,263 $ 103.79 262,261 $ 138.23 As of June 30, 2021, outstanding options to purchase 1.3 million shares were exercisable with a weighted average exercise price per share of $91.50. Employee Stock Purchase Plan The price at which common stock is purchased under the Amended Employee Stock Purchase Plan, or ESPP, is equal to 85% of the fair market value of the common stock on the first or last day of the offering period, whichever is lower. As of June 30, 2021, 46,866 shares were available for future purchases under the ESPP. Share Repurchases We did not have any share repurchases during the six months ended June 30, 2021. |
Commitment and Contingencies_ L
Commitment and Contingencies: Legal Proceedings | 6 Months Ended |
Jun. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitment and Contingencies: Legal Proceedings | Commitment and Contingencies: Legal Proceedings We record an estimate of a loss when the loss is considered probable and estimable. Where a liability is probable and there is a range of estimated loss and no amount in the range is more likely than any other number in the range, we record the minimum estimated liability related to the claim in accordance with ASC 450, Contingencies . As additional information becomes available, we assess the potential liability related to our pending litigation and revises our estimates. Revisions in our estimates of potential liability could materially impact our results of operations. On April 9, 2019, CyDex, our wholly-owned subsidiary, received a Paragraph IV certification Notice Letter from Alembic Global Holdings SA (“Alembic”) stating that Alembic had submitted an ANDA to the FDA, seeking approval to manufacture, offer to sell, and sell a generic version of EVOMELA ® prior to the expiration of any of the ’077 patent; the ’088 patent, the ’582 patent, or U.S. Patent No. 10,040,872 (“the ’872 patent”), and alleging that these patents, each of which relates to Captisol, are invalid, unenforceable, and/or would not be infringed by Alembic’s ANDA product. On May 23, 2019, CyDex filed a complaint against Alembic, Alembic Pharmaceuticals, Ltd., and Alembic Pharmaceuticals, Inc. in the U.S. District Court for the District of Delaware, asserting that the filing of Alembic’s ANDA constitutes infringement of each of the ’088 patent and the ’582 patent. The parties entered into a settlement agreement on June 1, 2021 and the lawsuit has been dismissed. On September 16, 2019, CyDex received a Paragraph IV certification Notice Letter from Lupin Ltd. (“Lupin”) stating that Lupin had submitted an ANDA to the FDA, seeking approval to manufacture, offer to sell, and sell a generic version of EVOMELA ® prior to the expiration of any of the ’077 patent; the ’088 patent, the ’582 patent, or the ’872 patent, and alleging that these patents, each of which relates to Captisol, are invalid, unenforceable, and/or would not be infringed by Lupin’s ANDA product. CyDex filed a complaint on October 29, 2019, alleging patent infringement against Lupin. Lupin filed an answer on December 11, 2019 and counterclaimed for declaratory judgments of invalidity and non-infringement as to all four patents and CyDex filed its answer to Lupin’s counterclaims on January 2, 2020. The parties entered into a settlement agreement on April 26, 2021 and the lawsuit has been dismissed. On October 31, 2019, we received three civil complaints filed in the US District Court for the Northern District of Ohio on behalf of several Indian tribes. The Northern District of Ohio is the Court that the Judicial Panel on Multi-District Litigation (“JPML”) has assigned more than one thousand civil cases which have been designated as a Multi-District Litigation (“MDL”) and captioned In Re: National Prescription Opiate Litigation. The allegations in these complaints focus on the activities of defendants other than the company and no individualized factual allegations have been advanced against us in any of the three complaints. We reject all claims raised in the complaints and intend to vigorously defend these matters. In May and August of 2019, Pfenex Inc., which was acquired by us in October 2020, filed three petitions (IPR2019- 01027, IPR2019-01028 and IPR2019-01478) for inter partes review of U.S. Patent No. 9,422,345 (“the ‘345 patent,” entitled “Expression System”), which is owned by GlaxoSmithKline Biologicals S.A. (“GSK”), with the Patent Trial and Appeal Board (“PTAB”) of the U.S. Patent and Trademark Office. In November 2019 and February 2020, the Board instituted trial on invalidity grounds in IPR2019-01028, but exercised its discretion not to institute trial on IPR2019-01027 or IPR2019-01478. In May 2020, GSK filed two petitions (IPR2020-00890 and IPR2020-00962) for inter partes review of U.S. Patent No. 8,530,171 (“the ‘171 patent,” entitled “High Level Expression of Recombinant Toxin Proteins”), which is owned by Pfenex, with the PTAB of the U.S. Patent and Trademark Office. On June 29, 2020, GSK filed a motion to withdraw IPR2020-00890, which was granted on August 28, 2020. In October 2020, Pfenex and GSK executed a confidential settlement agreement agreeing to terminate the proceedings before the PTAB resolving these issues. Pfenex and GSK filed a joint motion to terminate IPR2019-01028 and IPR2020-00962 on October 30, 2020, and an amended joint motion to terminate on November 4, 2020. A decision granting the parties’ joint motion to terminate in IPR2019-01028 was issued on November 12, 2020. The PTAB subsequently granted the parties’ joint motion to terminate in IPR2020-00962 on December 30, 2020. On January 12, 2021, Abvivo submitted a JAMS arbitration demand naming the Company as respondent. Abvivo claimed that the Company was in violation of the assignment provision of that certain Commercial Platform License and Services Agreement (“CPLSA”), dated October 9, 2019, by and among OMT and Crystal, on the one hand, and Abvivo, on the other hand because the Company allegedly withheld its consent to a proposed assignment required for Abvivo to negotiate a discovery and development alliance with certain third parties. On January 26, 2021, we submitted a response to the demand, denying all claims and alleging counterclaims against Abvivo and Brian Lundstrom, a Company employee and the sole owner of Abvivo. We alleged that Mr. Lundstrom breached his fiduciary duty of loyalty to the Company and that Abvivo and Mr. Lundstrom fraudulently induced the Company, OMT and Crystal into certain business transactions and contracts. Abvivo and Mr. Lundstrom’s response to these counterclaims was due on February 9, 2021, but they did not submit a response. Under JAMS rules, the counterclaims were deemed denied. On February 22, 2021, Abvivo submitted documents to JAMS which indicated that it sought to dismiss its claim without prejudice. On February 25, 2021, we submitted additional counterclaims against Abvivo and Mr. Lundstrom. These counterclaims alleged that Abvivo and Mr. Lundstrom made false promises regarding the CPLSA, Abvivo’s breach of and failure to perform under the CPLSA, and Abvivo’s infringement of certain Ligand trademarks. On March 11, 2021, Abvivo and Mr. Lundstrom submitted an answer to our amended counterclaims denying all of the claims and asserting various affirmative defenses. On June 21, 2021, the parties executed a confidential settlement agreement that settled all claims in this arbitration. On June 29, 2021, the parties jointly submitted to JAMS a dismissal with prejudice of all claims by all parties in the arbitration. CyDex and Baxter Healthcare Corp. (“Baxter”) are parties to a license agreement relating to Ligand’s Captisol |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of PresentationOur condensed consolidated financial statements include the financial statements of Ligand and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. We have included all adjustments, consisting only of normal recurring adjustments, which we considered necessary for a fair presentation of our financial results. These unaudited condensed consolidated financial statements and accompanying notes should be read together with the audited consolidated financial statements included in our 2020 Annual Report. Interim financial results are not necessarily indicative of the results that may be expected for the full year. |
Reclassifications | ReclassificationsCertain amounts in the prior period condensed consolidated financial statements have been reclassified to conform with the current period presentation. Specifically, “contract revenue” and “service revenue” presented in the condensed consolidated statement of operations for the three and six months ended June 30, 2021 have been combined into “contract revenue” in the condensed consolidated statement of operations to conform with the current period presentation. |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires the use of estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and the accompanying notes. Actual results may differ from those estimates. |
Accounting Standards Not Yet Adopted | Accounting Standards Not Yet Adopted In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. The new guidance simplifies accounting for convertible instruments by removing major separation models required under current GAAP. This standard removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception and it also simplifies the diluted earnings per share calculation in certain areas. This standard is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020 and adoption must be as of the beginning of the Company’s annual fiscal year. We are currently evaluating the impact of this standard on our consolidated financial statements and related disclosures. We intend to adopt this standard on January 1, 2022. We do not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material impact on our condensed consolidated financial statements or disclosures. |
Revenue | Revenue Our revenue is generated primarily from royalties on sales of products commercialized by our partners, Captisol material sales, and contract revenue for services, license fees and development, regulatory and sales based milestone payments. Royalties We receive royalty revenue on sales by our partners of products covered by patents that we own. We do not have future performance obligations under these license arrangements. We generally satisfy our obligation to grant intellectual property rights on the effective date of the contract. However, we apply the royalty recognition constraint required under the guidance for sales-based royalties which requires a sales-based royalty to be recorded when the underlying sale occurs. Therefore, royalties on sales of products commercialized by our partners are recognized in the quarter the product is sold. Our partners generally report sales information to us on a one quarter lag. Thus, we estimate the expected royalty proceeds based on an analysis of historical experience and interim data provided by our partners including their publicly announced sales. Differences between actual and estimated royalty revenues are adjusted for in the period in which they become known, typically the following quarter. Contract Revenue Our contract revenue includes service revenue, license fees and future contingent milestone based payments. We recognize service revenue for contracted R&D services performed for our customers over time. We measure our progress using an input method based on the effort we expend or costs we incur toward the satisfaction of our performance obligation. We estimate the amount of effort we expend, including the time we estimate it will take us to complete the activities, or costs we incur in a given period, relative to the estimated total effort or costs to satisfy the performance obligation. This results in a percentage that we multiply by the transaction price to determine the amount of revenue we recognize each period. This approach requires us to make estimates and use judgement. If our estimates or judgements change over the course of the collaboration, they may affect the timing and amount of revenue that we recognize in the current and future periods. We include contingent milestone based payments in the estimated transaction price when there is a basis to reasonably estimate the amount of the payment. These estimates are based on historical experience, anticipated results and our best judgment at the time. If the contingent milestone based payment is sales-based, we apply the royalty recognition constraint and record revenue when the underlying sale has taken place. Significant judgments must be made in determining the transaction price for our sales of intellectual property. Because of the risk that products in development with our partners will not reach development based milestones or receive regulatory approval, we generally recognize any contingent payments that would be due to us upon or after the development milestone or regulatory approval. Captisol Sales We recognize revenue when control of Captisol material is transferred to our customers in an amount that reflects the consideration we expect to receive from our customers in exchange for those products. This process involves identifying the contract with a customer, determining the performance obligations in the contract, determining the contract price, allocating the contract price to the distinct performance obligations in the contract, and recognizing revenue when the performance obligations have been satisfied. A performance obligation is considered distinct from other obligations in a contract when it provides a benefit to the customer either on its own or together with other resources that are readily available to the customer and is separately identified in the contract. We consider a performance obligation satisfied once we have transferred control of the product, meaning the customer has the ability to use and obtain the benefit of the Captisol material or intellectual property license right. We recognize revenue for satisfied performance obligations only when we determine there are no uncertainties regarding payment terms or transfer of control. We have elected to recognize the cost for freight and shipping when or after control over Captisol material has transferred to the customer as an expense in cost of Captisol. Sales tax and other taxes we collect concurrent with revenue-producing activities are excluded from revenue. We expense incremental costs of obtaining a contract when incurred if the expected amortization period of the asset that we would have recognized is one year or less or the amount is immaterial. We did not incur any incremental costs of obtaining a contract during the periods reported. Deferred Revenue Depending on the terms of the arrangement, we may also defer a portion of the consideration received because we have to satisfy a future obligation. We use an observable price to determine the stand-alone selling price for separate performance obligations or a cost plus margin approach when one is not available. |
Accounts Receivable and Allowance for Credit Losses | Accounts Receivable and Allowance for Credit LossesOur accounts receivable arise primarily from sales on credit to customers. We establish an allowance for credit losses to present the net amount of accounts receivable expected to be collected. The allowance is determined by using the loss-rate method, which requires an estimation of loss rates based upon historical loss experience adjusted for factors that are relevant to determining the expected collectability of accounts receivable. Some of these factors include macroeconomic conditions that correlate with historical loss experience, delinquency trends, aging behavior of receivables and credit and liquidity quality indicators for industry groups, customer classes or individual customers. |
Share-Based Compensation | Share-Based Compensation Share-based compensation expense for awards to employees and non-employee directors is a non-cash expense and is recognized on a straight-line basis over the vesting period until the last tranche vests. The following table summarizes share-based compensation expense recorded as components of research and development expenses and general and administrative expenses for the periods indicated (in thousands): Three months ended Six months ended June 30, June 30, 2021 2020 2021 2020 SBC - Research and development expenses $ 4,556 $ 3,019 $ 8,495 $ 5,416 SBC - General and administrative expenses 5,660 4,340 10,126 7,596 $ 10,216 $ 7,359 $ 18,621 $ 13,012 The fair-value for options that were awarded to employees and directors was estimated at the date of grant using the Black-Scholes option valuation model with the following weighted-average assumptions: Three months ended Six months ended June 30, June 30, 2021 2020 2021 2020 Risk-free interest rate 0.9% 0.4% 0.5% 1.1% Dividend yield — — — — Expected volatility 54% 69% 62% 55% Expected term 5.5 5.1 5.0 4.8 A limited amount of performance-based restricted stock units (PSUs) contain a market condition based on our relative total shareholder return ranked on a percentile basis against the NASDAQ Biotechnology Index over a three-year performance period, with a range of 0% to 200% of the target amount granted to be issued under the award. Share-based compensation cost for these PSUs is measured using the Monte-Carlo simulation valuation model and is not adjusted for the achievement, or lack thereof, of the performance conditions. |
Net Income (Loss) Per Share | Net Income (Loss) Per Share Basic net income (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted net income per share is computed based on the sum of the weighted average number of common shares and potentially dilutive common shares outstanding during the period. Diluted net loss per share is computed based on the sum of the weighted average number of common shares outstanding during the period. Potentially dilutive common shares consist of shares issuable under the 2023 Notes, stock options and restricted stock. The 2023 Notes have a dilutive impact when the average market price of our common stock exceeds the applicable conversion price of the respective notes. It is our intent and policy to settle conversions through combination settlement, which involves payment in cash equal to the principal portion and delivery of shares of common stock for the excess of the conversion value over the principal portion. Potentially dilutive common shares from stock options and restricted stock are determined using the average share price for each period under the treasury stock method. In addition, the following amounts are assumed to be used to repurchase shares: proceeds from exercise of stock options and the average amount of unrecognized compensation expense for the awards. See Note 4, Convertible Senior Notes and Note 6, Stockholders’ Equity . |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Revenue by Source | The following table represents disaggregation of royalties, Captisol and contract revenue (in thousands): Three months ended Six months ended June 30, June 30, 2021 2020 2021 2020 Royalties Kyprolis $ 5,440 $ 5,481 $ 9,727 $ 9,886 Evomela 2,193 1,199 4,526 2,775 Other 983 501 1,475 1,085 $ 8,616 $ 7,181 $ 15,728 $ 13,746 Captisol $ 62,509 $ 24,468 $ 93,781 $ 45,577 Contract revenue Service Revenue $ 7,360 $ 4,582 $ 12,822 $ 7,939 License Fees 1,050 660 2,093 1,635 Milestone 3,600 3,472 12,017 3,806 Other 1,540 1,057 3,384 1,878 $ 13,550 $ 9,771 $ 30,316 $ 15,258 Total $ 84,675 $ 41,420 $ 139,825 $ 74,581 |
Schedule of Short-Term Investments | Our short-term investments consist of the following at June 30, 2021 and December 31, 2020 (in thousands): June 30, 2021 December 31, 2020 Amortized cost Gross unrealized gains Gross unrealized losses Estimated fair value Amortized cost Gross unrealized gains Gross unrealized losses Estimated fair value Bank deposits $ 33,560 $ 13 $ (2) $ 33,571 $ 84,120 $ 35 $ (1) $ 84,154 Corporate bonds 25,965 62 (2) 26,025 30,512 99 (1) 30,610 Agency bonds 2,500 — (1) 2,499 4,499 2 — 4,501 Commercial paper 19,258 12 — 19,270 45,459 27 (1) 45,485 Corporate equity securities 5,807 172 (310) 5,669 4,466 360 (1,388) 3,438 Mutual fund 151,949 53 — 152,002 151,512 386 — 151,898 Treasury bill — — — — 3,999 — — 3,999 Warrants — 713 — 713 — 393 — 393 $ 239,039 $ 1,025 $ (315) $ 239,749 $ 324,567 $ 1,302 $ (1,391) $ 324,478 Viking common stock 40,223 32,763 Viking warrants — 6,326 Total short-term investments $ 279,972 $ 363,567 |
Schedule of Available-for-Sale Debt Securities | The following table summarizes our available-for-sale debt securities by contractual maturity (in thousands): June 30, 2021 Amortized Cost Fair Value Within one year $ 57,997 $ 58,050 After one year through five years 23,286 23,316 Total $ 81,283 $ 81,366 |
Schedule of Goodwill and Other Identifiable Intangible Assets | Goodwill and other identifiable intangible assets consist of the following (in thousands): June 30, December 31, 2021 2020 Indefinite-lived intangible assets Goodwill $ 190,517 $ 189,662 Definite lived intangible assets Complete technology 277,980 277,740 Less: accumulated amortization (71,276) (63,600) Trade name 2,642 2,642 Less: accumulated amortization (1,378) (1,312) Customer relationships 40,700 40,700 Less: accumulated amortization (16,932) (15,597) Contractual relationships 362,000 362,000 Less: accumulated amortization (21,730) (7,243) Total goodwill and other identifiable intangible assets, net $ 762,523 $ 784,992 |
Schedule of Commercial License and Other Economic Rights | Commercial license and other economic rights consist of the following (in thousands): June 30, 2021 December 31, 2020 Gross Adjustments (1) Net Gross Adjustments (2) Net Aziyo and CorMatrix $ 17,696 $ (9,470) $ 8,226 $ 17,696 $ (9,588) $ 8,108 Selexis and Dianomi 10,602 (8,190) 2,412 10,602 (7,731) 2,871 Total $ 28,298 $ (17,660) $ 10,638 $ 28,298 $ (17,319) $ 10,979 (1) Amounts represent accumulated amortization to principal of $11.7 million and credit loss adjustments of $6.0 million as of June 30, 2021. (2) Amounts represent accumulated amortization to principal of $11.3 million and credit loss adjustments of $6.0 million as of December 31, 2020. |
Schedule of Accrued Liabilities | Accrued liabilities consist of the following (in thousands): June 30, December 31, 2021 2020 Compensation $ 3,684 $ 8,810 Professional fees 977 977 Amounts owed to former licensees 446 421 Royalties owed to third parties 52 693 Return reserve 105 687 Acquisition related liabilities 1,500 1,500 Subcontractor — 733 Supplier 681 604 Accrued interest 295 464 Other 2,367 3,641 Total accrued liabilities $ 10,107 $ 18,530 |
Schedule of Accounting for Share-Based Compensation | The following table summarizes share-based compensation expense recorded as components of research and development expenses and general and administrative expenses for the periods indicated (in thousands): Three months ended Six months ended June 30, June 30, 2021 2020 2021 2020 SBC - Research and development expenses $ 4,556 $ 3,019 $ 8,495 $ 5,416 SBC - General and administrative expenses 5,660 4,340 10,126 7,596 $ 10,216 $ 7,359 $ 18,621 $ 13,012 |
Schedule of Fair-Value Options Awarded to Employees and Directors | The fair-value for options that were awarded to employees and directors was estimated at the date of grant using the Black-Scholes option valuation model with the following weighted-average assumptions: Three months ended Six months ended June 30, June 30, 2021 2020 2021 2020 Risk-free interest rate 0.9% 0.4% 0.5% 1.1% Dividend yield — — — — Expected volatility 54% 69% 62% 55% Expected term 5.5 5.1 5.0 4.8 |
Schedule of Computation of Basic and Diluted Earnings per Share | The following table presents the calculation of weighted average shares used to calculate basic and diluted earnings per share (in thousands): Three months ended Six months ended June 30, June 30, 2021 2020 2021 2020 Weighted average shares outstanding: 16,659 16,055 16,548 16,292 Dilutive potential common shares: Restricted stock 69 40 90 — Stock options 444 599 572 — Shares used to compute diluted income per share 17,172 16,694 17,210 16,292 Potentially dilutive shares excluded from calculation due to anti-dilutive effect 5,087 7,832 4,684 8,988 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets and Liabilities Measured at Fair Value | The following table presents the hierarchy for our assets and liabilities measured at fair value (in thousands): June 30, 2021 December 31, 2020 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets: Short-term investments, excluding Viking (1) $ 5,669 $ 233,368 $ 712 $ 239,749 $ 3,438 $ 320,647 $ 393 $ 324,478 Investment in Viking common stock 40,223 — — 40,223 32,763 — — 32,763 Investment in Viking warrants (2) — — — — 6,326 — — 6,326 Total assets $ 45,892 $ 233,368 $ 712 $ 279,972 $ 42,527 $ 320,647 $ 393 $ 363,567 Liabilities: Crystal contingent liabilities (3) $ — $ — $ 800 $ 800 $ — $ — $ 800 $ 800 CyDex contingent liabilities — — 376 376 — — 508 508 Metabasis contingent liabilities (4) — 3,930 — 3,930 — 3,821 — 3,821 Icagen contingent liabilities (5) — — 5,625 5,625 — — 6,404 6,404 Pfenex contingent liabilities (6) — — 3,800 3,800 — — 37,600 37,600 xCella contingent liabilities (7) — — 240 240 — — — — Amounts owed to former licensor 31 — — 31 60 — — 60 Total liabilities $ 31 $ 3,930 $ 10,841 $ 14,802 $ 60 $ 3,821 $ 45,312 $ 49,193 1. Excluding our investment in Viking, our short-term investments in marketable debt and equity securities are classified as available-for-sale securities based on management's intentions and are at level 2 of the fair value hierarchy, as these investment securities are valued based upon quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market. Short-term investments in mutual funds are valued at their net asset value (NAV) on the last day of the period. We have classified marketable securities with original maturities of greater than one year as short-term investments based upon our ability and intent to use any and all of those marketable securities to satisfy the liquidity needs of our current operations. In addition, we have investment in warrants resulting from Seelos Therapeutics Inc. milestone payments that were settled in shares during the first quarter of 2019 and are at level 3 of the fair value hierarchy, based on Black Scholes value estimated by management on the last day of the period. 2. Investment in Viking warrants, which we received as a result of Viking’s partial repayment of the Viking note receivable and our purchase of Viking common stock and warrants in April 2016, are classified as level 1 as the fair value is determined using quoted market prices in active markets for the same securities. The change of the fair value is recorded in "Gain (loss) from short-term investments" in our condensed consolidated statement of operations. During the six months ended June 30, 2021, we exercised all of the outstanding Viking warrants. 3. The fair value of Crystal contingent liabilities was determined using a probability weighted income approach. Most of the contingent payments are based on development or regulatory milestones as defined in the merger agreement with Crystal. The fair value is subjective and is affected by changes in inputs to the valuation model including management’s estimates regarding the timing and probability of achievement of certain developmental and regulatory milestones. Changes in these estimates may materially affect the fair value. 4. In connection with our acquisition of Metabasis in January 2010, we issued Metabasis stockholders four tradable CVRs, one CVR from each of four respective series of CVR, for each Metabasis share. The CVRs entitle Metabasis stockholders to cash payments as frequently as every six months as cash is received by us from proceeds from the sale or partnering of any of the Metabasis drug development programs, among other triggering events. The liability for the CVRs is determined using quoted prices in a market that is not active for the underlying CVR. The carrying amount of the liability may fluctuate significantly based upon quoted market prices and actual amounts paid under the agreements may be materially different than the carrying amount of the liability. Several of the Metabasis drug development programs have been outlicensed to Viking, including VK2809. VK2809 is a novel selective TR-β agonist with potential in multiple indications, including hypercholesterolemia, dyslipidemia, NASH, and X-ALD. Under the terms of the agreement with Viking, we may be entitled to up to $375 million of development, regulatory and commercial milestones and tiered royalties on potential future sales including a $10 million payment upon initiation of a Phase 3 clinical trial. 5. The fair value of Icagen contingent liabilities was determined using a probability weighted income approach. Most of the contingent payments are based on certain revenue milestones as defined in the asset purchase agreement with Icagen. The fair value is subjective and is affected by changes in inputs to the valuation model including management’s estimates regarding the timing and probability of achievement of certain developmental and regulatory milestones. Changes in these estimates may materially affect the fair value. During the six months ended June 30, 2021, we paid $1.1 million contingent liability based on revenue milestones to former Icagen shareholders. 6. The fair value of Pfenex contingent liabilities was determined using a probability-adjusted income approach. These cash flows were then discounted to present value using a discount rate based on the market participants' cost of debt reflective of the Company. During the three and six months ended June 30, 2021, we reduced the contingent liability by $34.1 million and $33.8 million, respectively, primarily due to the lower probability of achieving the specific development and regulatory milestone by December 31, 2021 as defined by the Pfenex CVR. See further detail on Pfenex CVR in Note 3, Acquisitions . |
Schedule of Reconciliation of Level 3 Financial Instruments | A reconciliation of the level 3 financial instruments as of June 30, 2021 is as follows (in thousands): Fair value of level 3 financial instruments as of December 31, 2020 $ 45,312 Payments to CVR holders and other contingent payments (1,050) Fair value adjustments to contingent liabilities (33,661) Contingent liabilities from xCella asset acquisition 240 Fair value of level 3 financial instruments as of June 30, 2021 $ 10,841 |
Acquisitions (Tables)
Acquisitions (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table sets forth an allocation of the preliminary purchase price to the identifiable tangible and intangible assets acquired and liabilities assumed, with the excess recorded to goodwill (in thousands): Cash $ 51,407 Restricted cash 200 Accounts and unbilled receivables 1,359 Property and equipment, net 7,823 Right-of-use asset 3,070 Other assets 1,338 Intangibles acquired 385,000 Goodwill (1) 91,837 Accounts payable (6,814) Accrued liabilities (8,455) Deferred revenue (3,908) Lease liabilities (3,070) Other liabilities (1,382) Deferred tax liabilities, net (53,296) $ 465,109 |
Schedule of Pro Forma Information | The following summary presents our unaudited pro forma consolidated results of operations for the three and six months ended June 30, 2020 as if the Pfenex acquisition had occurred on January 1, 2020, which gives effect to certain transaction accounting adjustments, including amortization of acquired intangibles and share based compensation expense for retained Pfenex employees. The pro forma financial information is not necessarily indicative of the operating results that would have occurred had the acquisition been consummated as of the date indicated, nor is it necessarily indicative of future operating results (in thousands, except per share amounts): Three months ended Six months ended Revenue $ 42,201 $ 76,044 Net income (loss) $ 7,435 $ (30,505) Net income (loss) per common share: Basic $ 0.46 $ (1.87) Diluted $ 0.45 $ (1.87) |
Convertible Senior Notes (Table
Convertible Senior Notes (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Carrying Values and Coupon Rates on Financing Arrangements | The following table summarizes information about the 2023 Notes (in thousands): June 30, 2021 December 31, 2020 Principal amount of the 2023 Notes outstanding $ 345,729 $ 495,280 Unamortized discount (including unamortized debt issuance cost) (30,411) (52,987) Total long-term portion of notes payable $ 315,318 $ 442,293 Carrying value of equity component of the 2023 Notes $ 27,776 $ 48,397 Fair value of the 2023 Notes outstanding (Level 2) $ 341,687 $ 466,053 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Equity [Abstract] | |
Schedule of Stock Option Plan Activity | The following is a summary of our stock option and restricted stock activity and related information: Stock Options Restricted Stock Awards Shares Weighted-Average Exercise Price Shares Weighted-Average Grant Date Fair Value Balance as of December 31, 2020 2,561,822 $ 85.59 206,202 $ 106.88 Granted 318,381 $ 164.30 158,456 $ 171.44 Options exercised/RSUs vested (533,451) $ 52.00 (95,607) $ 126.49 Forfeited (83,489) $ 106.98 (6,790) $ 126.23 Balance as of June 30, 2021 2,263,263 $ 103.79 262,261 $ 138.23 |
Schedule of Restricted Stock Activity | The following is a summary of our stock option and restricted stock activity and related information: Stock Options Restricted Stock Awards Shares Weighted-Average Exercise Price Shares Weighted-Average Grant Date Fair Value Balance as of December 31, 2020 2,561,822 $ 85.59 206,202 $ 106.88 Granted 318,381 $ 164.30 158,456 $ 171.44 Options exercised/RSUs vested (533,451) $ 52.00 (95,607) $ 126.49 Forfeited (83,489) $ 106.98 (6,790) $ 126.23 Balance as of June 30, 2021 2,263,263 $ 103.79 262,261 $ 138.23 |
Basis of Presentation and Sum_4
Basis of Presentation and Summary of Significant Accounting Policies - Narrative (Details) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2021USD ($)position$ / sharesshares | Jun. 30, 2020USD ($)shares | Jun. 30, 2021USD ($)position$ / sharesshares | Jun. 30, 2020USD ($)shares | Jan. 01, 2020USD ($) | |
Property, Plant and Equipment [Line Items] | |||||
Revenue recognized from milestone method revenue | $ 10,300,000 | $ 2,000,000 | $ 16,100,000 | $ 2,400,000 | |
Warrants outstanding (shares) | shares | 0 | 0 | |||
Number of positions in an unrealized loss position | position | 7 | 7 | |||
Credit losses related to available-for-sale debt securities | $ 0 | $ 0 | |||
Additional allowance for credit losses recorded related to COVID-19 | 40,000 | 100,000 | |||
Advances on inventory purchases | 50,200,000 | 50,200,000 | |||
Credits applied on advances on inventory purchases | $ 15,800,000 | $ 15,800,000 | |||
Allowance for credit loss | $ 5,500,000 | ||||
Potentially dilutive shares excluded from calculation due to anti-dilutive effect (in shares) | shares | 5,087,000 | 7,832,000 | 4,684,000 | 8,988,000 | |
Share-based Compensation | |||||
Property, Plant and Equipment [Line Items] | |||||
Potentially dilutive shares excluded from calculation due to anti-dilutive effect (in shares) | shares | 600,000 | ||||
Restricted Stock Awards | |||||
Property, Plant and Equipment [Line Items] | |||||
Performance period for awards | 3 years | ||||
Royalty Agreements | Aziyo | |||||
Property, Plant and Equipment [Line Items] | |||||
Effective interest rate for forecasted cash flows (as a percent) | 23.00% | ||||
Royalty Agreements | Selexis | |||||
Property, Plant and Equipment [Line Items] | |||||
Effective interest rate for forecasted cash flows (as a percent) | 21.00% | ||||
Maximum | Restricted Stock Awards | |||||
Property, Plant and Equipment [Line Items] | |||||
Payout range (as a percent) | 200.00% | ||||
Minimum | Restricted Stock Awards | |||||
Property, Plant and Equipment [Line Items] | |||||
Payout range (as a percent) | 0.00% | ||||
Viking Therapeutics, Inc. | |||||
Property, Plant and Equipment [Line Items] | |||||
Warrant exercise price (USD per share) | $ / shares | $ 1.50 | $ 1.50 | |||
Viking Therapeutics, Inc. | Maximum | |||||
Property, Plant and Equipment [Line Items] | |||||
Outstanding warrants to purchase shares of Viking's common stock (shares) | shares | 1,500,000 | 1,500,000 |
Basis of Presentation and Sum_5
Basis of Presentation and Summary of Significant Accounting Policies - Revenue by Source (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Disaggregation of Revenue [Line Items] | ||||
Total revenue | $ 84,675 | $ 41,420 | $ 139,825 | $ 74,581 |
Royalties | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 8,616 | 7,181 | 15,728 | 13,746 |
Kyprolis | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 5,440 | 5,481 | 9,727 | 9,886 |
Evomela | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 2,193 | 1,199 | 4,526 | 2,775 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 983 | 501 | 1,475 | 1,085 |
Captisol | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 62,509 | 24,468 | 93,781 | 45,577 |
Contract revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 13,550 | 9,771 | 30,316 | 15,258 |
Service Revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 7,360 | 4,582 | 12,822 | 7,939 |
License Fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 1,050 | 660 | 2,093 | 1,635 |
Milestone | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 3,600 | 3,472 | 12,017 | 3,806 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | $ 1,540 | $ 1,057 | $ 3,384 | $ 1,878 |
Basis of Presentation and Sum_6
Basis of Presentation and Summary of Significant Accounting Policies - Investment Categories (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | $ 239,039 | $ 324,567 |
Gross unrealized gains | 1,025 | 1,302 |
Gross unrealized losses | (315) | (1,391) |
Estimated fair value | 239,749 | 324,478 |
Estimated fair value | 279,972 | 363,567 |
Bank deposits | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 33,560 | 84,120 |
Gross unrealized gains | 13 | 35 |
Gross unrealized losses | (2) | (1) |
Estimated fair value | 33,571 | 84,154 |
Corporate bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 25,965 | 30,512 |
Gross unrealized gains | 62 | 99 |
Gross unrealized losses | (2) | (1) |
Estimated fair value | 26,025 | 30,610 |
Agency bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 2,500 | 4,499 |
Gross unrealized gains | 0 | 2 |
Gross unrealized losses | (1) | 0 |
Estimated fair value | 2,499 | 4,501 |
Commercial paper | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 19,258 | 45,459 |
Gross unrealized gains | 12 | 27 |
Gross unrealized losses | 0 | (1) |
Estimated fair value | 19,270 | 45,485 |
Corporate equity securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 5,807 | 4,466 |
Gross unrealized gains | 172 | 360 |
Gross unrealized losses | (310) | (1,388) |
Estimated fair value | 5,669 | 3,438 |
Mutual fund | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 151,949 | 151,512 |
Gross unrealized gains | 53 | 386 |
Gross unrealized losses | 0 | 0 |
Estimated fair value | 152,002 | 151,898 |
Treasury bill | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 0 | 3,999 |
Gross unrealized gains | 0 | 0 |
Gross unrealized losses | 0 | 0 |
Estimated fair value | 0 | 3,999 |
Warrants | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 0 | 0 |
Gross unrealized gains | 713 | 393 |
Gross unrealized losses | 0 | 0 |
Estimated fair value | 713 | 393 |
Estimated fair value | 0 | 6,326 |
Common Stock | ||
Debt Securities, Available-for-sale [Line Items] | ||
Estimated fair value | $ 40,223 | $ 32,763 |
Basis of Presentation and Sum_7
Basis of Presentation and Summary of Significant Accounting Policies - Available-for-Sale Debt Securities by Contractual Maturity (Details) $ in Thousands | Jun. 30, 2021USD ($) |
Amortized Cost | |
Within one year | $ 57,997 |
After one year through five years | 23,286 |
Total | 81,283 |
Fair Value | |
Within one year | 58,050 |
After one year through five years | 23,316 |
Total | $ 81,366 |
Basis of Presentation and Sum_8
Basis of Presentation and Summary of Significant Accounting Policies - Goodwill and Other Identifiable Intangible Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Summary of Goodwill and Other Identifiable Intangible Assets | ||
Goodwill | $ 190,517 | $ 189,662 |
Total goodwill and other identifiable intangible assets, net | 762,523 | 784,992 |
Complete technology | ||
Summary of Goodwill and Other Identifiable Intangible Assets | ||
Definite lived intangible assets | 277,980 | 277,740 |
Less: accumulated amortization | (71,276) | (63,600) |
Trade name | ||
Summary of Goodwill and Other Identifiable Intangible Assets | ||
Definite lived intangible assets | 2,642 | 2,642 |
Less: accumulated amortization | (1,378) | (1,312) |
Customer relationships | ||
Summary of Goodwill and Other Identifiable Intangible Assets | ||
Definite lived intangible assets | 40,700 | 40,700 |
Less: accumulated amortization | (16,932) | (15,597) |
Contractual relationships | ||
Summary of Goodwill and Other Identifiable Intangible Assets | ||
Definite lived intangible assets | 362,000 | 362,000 |
Less: accumulated amortization | $ (21,730) | $ (7,243) |
Basis of Presentation and Sum_9
Basis of Presentation and Summary of Significant Accounting Policies - Commercial License and Other Economic Rights (Details) - Commercial license rights - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Commercial License and Other Economic Rights | ||
Gross | $ 28,298 | $ 28,298 |
Adjustments | (17,660) | (17,319) |
Net | 10,638 | 10,979 |
Accumulated amortization on finite-lived intangible assets | (11,700) | (11,300) |
Credit loss adjustments of finite-lived intangible assets | (6,000) | (6,000) |
Aziyo and CorMatrix | ||
Commercial License and Other Economic Rights | ||
Gross | 17,696 | 17,696 |
Adjustments | (9,470) | (9,588) |
Net | 8,226 | 8,108 |
Selexis and Dianomi | ||
Commercial License and Other Economic Rights | ||
Gross | 10,602 | 10,602 |
Adjustments | (8,190) | (7,731) |
Net | $ 2,412 | $ 2,871 |
Basis of Presentation and Su_10
Basis of Presentation and Summary of Significant Accounting Policies - Accrued Liabilities and Other Long-Term Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Accrued Liabilities | ||
Compensation | $ 3,684 | $ 8,810 |
Professional fees | 977 | 977 |
Amounts owed to former licensees | 446 | 421 |
Royalties owed to third parties | 52 | 693 |
Return reserve | 105 | 687 |
Acquisition related liabilities | 1,500 | 1,500 |
Subcontractor | 0 | 733 |
Supplier | 681 | 604 |
Accrued interest | 295 | 464 |
Other | 2,367 | 3,641 |
Total accrued liabilities | $ 10,107 | $ 18,530 |
Basis of Presentation and Su_11
Basis of Presentation and Summary of Significant Accounting Policies - Accounting for Share-Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Basis of Presentation [Line Items] | ||||
Share-based compensation expense | $ 10,216 | $ 7,359 | $ 18,621 | $ 13,012 |
SBC - Research and development expenses | ||||
Basis of Presentation [Line Items] | ||||
Share-based compensation expense | 4,556 | 3,019 | 8,495 | 5,416 |
SBC - General and administrative expenses | ||||
Basis of Presentation [Line Items] | ||||
Share-based compensation expense | $ 5,660 | $ 4,340 | $ 10,126 | $ 7,596 |
Basis of Presentation and Su_12
Basis of Presentation and Summary of Significant Accounting Policies - Fair Value Valuation Assumptions (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Risk-free interest rate (as a percent) | 0.90% | 0.40% | 0.50% | 1.10% |
Dividend yield (as a percent) | 0.00% | 0.00% | 0.00% | 0.00% |
Expected volatility (as a percent) | 54.00% | 69.00% | 62.00% | 55.00% |
Expected term | 5 years 6 months | 5 years 1 month 6 days | 5 years | 4 years 9 months 18 days |
Basis of Presentation and Su_13
Basis of Presentation and Summary of Significant Accounting Policies - Earnings (Loss) Per Share (Details) - shares shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Summary of computation of basic and diluted net income (loss) per share | ||||
Weighted average shares outstanding (in shares) | 16,659 | 16,055 | 16,548 | 16,292 |
Dilutive potential common shares: | ||||
Restricted stock (in shares) | 69 | 40 | 90 | 0 |
Stock options (in shares) | 444 | 599 | 572 | 0 |
Shares used to compute diluted income per share (in shares) | 17,172 | 16,694 | 17,210 | 16,292 |
Potentially dilutive shares excluded from calculation due to anti-dilutive effect (in shares) | 5,087 | 7,832 | 4,684 | 8,988 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |
Jan. 31, 2010contingent_value_rightcontingent_value_right_series | Jun. 30, 2021USD ($) | Jun. 30, 2021USD ($) | Dec. 31, 2020USD ($) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Number of CVR Series | contingent_value_right_series | 4 | |||
Transferred over Time | Phase 3 Clinical Trial | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Gross contract asset | $ 10,000,000 | $ 10,000,000 | ||
Maximum | Transferred over Time | Development, Regulatory, & Commercial Milestones and Tiered Royalties | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Investments | 375,000,000 | 375,000,000 | ||
Metabasis | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Number of CVRs issued per acquiree share | contingent_value_right | 4 | |||
Number of CVRs issued from each CVR series | contingent_value_right | 1 | |||
Frequency of cash payments to CVR holders | 6 months | |||
Contingent liabilities - Icagen | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Payment for contingent consideration liabilities | 1,100,000 | |||
Contingent liabilities - Pfenex | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Reduction in contingent liability | 34,100,000 | 33,800,000 | ||
Recurring | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets, fair value | 279,972,000 | 279,972,000 | $ 363,567,000 | |
Liabilities, fair value | 14,802,000 | 14,802,000 | 49,193,000 | |
Recurring | Contingent liabilities - Crystal | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 800,000 | 800,000 | 800,000 | |
Recurring | Contingent liabilities - CyDex | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 376,000 | 376,000 | 508,000 | |
Recurring | Contingent liabilities - Metabasis | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 3,930,000 | 3,930,000 | 3,821,000 | |
Recurring | Contingent liabilities - Icagen | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 5,625,000 | 5,625,000 | 6,404,000 | |
Recurring | Contingent liabilities - Pfenex | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 3,800,000 | 3,800,000 | 37,600,000 | |
Recurring | Contingent liabilities - xCella | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 240,000 | 240,000 | 0 | |
Recurring | Amounts owed to former licensor | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 31,000 | 31,000 | 60,000 | |
Recurring | Short-term investments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets, fair value | 239,749,000 | 239,749,000 | 324,478,000 | |
Recurring | Investment in Viking common stock | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets, fair value | 40,223,000 | 40,223,000 | 32,763,000 | |
Recurring | Investment in warrants | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets, fair value | 0 | 0 | 6,326,000 | |
Recurring | Level 1 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets, fair value | 45,892,000 | 45,892,000 | 42,527,000 | |
Liabilities, fair value | 31,000 | 31,000 | 60,000 | |
Recurring | Level 1 | Contingent liabilities - Crystal | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 0 | 0 | 0 | |
Recurring | Level 1 | Contingent liabilities - CyDex | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 0 | 0 | 0 | |
Recurring | Level 1 | Contingent liabilities - Metabasis | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 0 | 0 | 0 | |
Recurring | Level 1 | Contingent liabilities - Icagen | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 0 | 0 | 0 | |
Recurring | Level 1 | Contingent liabilities - Pfenex | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 0 | 0 | 0 | |
Recurring | Level 1 | Contingent liabilities - xCella | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 0 | 0 | 0 | |
Recurring | Level 1 | Amounts owed to former licensor | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 31,000 | 31,000 | 60,000 | |
Recurring | Level 1 | Short-term investments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets, fair value | 5,669,000 | 5,669,000 | 3,438,000 | |
Recurring | Level 1 | Investment in Viking common stock | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets, fair value | 40,223,000 | 40,223,000 | 32,763,000 | |
Recurring | Level 1 | Investment in warrants | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets, fair value | 0 | 0 | 6,326,000 | |
Recurring | Level 2 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets, fair value | 233,368,000 | 233,368,000 | 320,647,000 | |
Liabilities, fair value | 3,930,000 | 3,930,000 | 3,821,000 | |
Recurring | Level 2 | Contingent liabilities - Crystal | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 0 | 0 | 0 | |
Recurring | Level 2 | Contingent liabilities - CyDex | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 0 | 0 | 0 | |
Recurring | Level 2 | Contingent liabilities - Metabasis | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 3,930,000 | 3,930,000 | 3,821,000 | |
Recurring | Level 2 | Contingent liabilities - Icagen | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 0 | 0 | 0 | |
Recurring | Level 2 | Contingent liabilities - Pfenex | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 0 | 0 | 0 | |
Recurring | Level 2 | Contingent liabilities - xCella | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 0 | 0 | 0 | |
Recurring | Level 2 | Amounts owed to former licensor | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 0 | 0 | 0 | |
Recurring | Level 2 | Short-term investments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets, fair value | 233,368,000 | 233,368,000 | 320,647,000 | |
Recurring | Level 2 | Investment in Viking common stock | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets, fair value | 0 | 0 | 0 | |
Recurring | Level 2 | Investment in warrants | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets, fair value | 0 | 0 | 0 | |
Recurring | Level 3 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets, fair value | 712,000 | 712,000 | 393,000 | |
Liabilities, fair value | 10,841,000 | 10,841,000 | 45,312,000 | |
Recurring | Level 3 | Contingent liabilities - Crystal | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 800,000 | 800,000 | 800,000 | |
Recurring | Level 3 | Contingent liabilities - CyDex | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 376,000 | 376,000 | 508,000 | |
Recurring | Level 3 | Contingent liabilities - Metabasis | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 0 | 0 | 0 | |
Recurring | Level 3 | Contingent liabilities - Icagen | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 5,625,000 | 5,625,000 | 6,404,000 | |
Recurring | Level 3 | Contingent liabilities - Pfenex | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 3,800,000 | 3,800,000 | 37,600,000 | |
Recurring | Level 3 | Contingent liabilities - xCella | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 240,000 | 240,000 | 0 | |
Recurring | Level 3 | Amounts owed to former licensor | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Liabilities, fair value | 0 | 0 | 0 | |
Recurring | Level 3 | Short-term investments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets, fair value | 712,000 | 712,000 | 393,000 | |
Recurring | Level 3 | Investment in Viking common stock | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets, fair value | 0 | 0 | 0 | |
Recurring | Level 3 | Investment in warrants | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets, fair value | $ 0 | $ 0 | $ 0 |
Fair Value Measurements - Recon
Fair Value Measurements - Reconciliation of Level 3 Financial Instruments (Details) - Level 3 $ in Thousands | 6 Months Ended |
Jun. 30, 2021USD ($) | |
Financial and Nonfinancial Liabilities, Fair Value Disclosure [Roll Forward] | |
Fair value of level 3 financial instruments as of December 31, 2020 | $ 45,312 |
Payments to CVR holders and other contingent payments | (1,050) |
Fair value adjustments to contingent liabilities | (33,661) |
Contingent liabilities from xCella asset acquisition | 240 |
Fair value of level 3 financial instruments as of June 30, 2021 | $ 10,841 |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) | Oct. 01, 2020USD ($) | Sep. 09, 2020USD ($) | Sep. 08, 2020USD ($) | Apr. 01, 2020USD ($) | Jun. 30, 2021USD ($) | Dec. 31, 2020USD ($) | Jun. 30, 2021USD ($) |
Pfenex | |||||||
Business Acquisition [Line Items] | |||||||
Consideration transferred in acquisition | $ 465,100,000 | ||||||
Cash payments for acquisition | 429,600,000 | ||||||
Contingent earn-out payment | 77,800,000 | ||||||
Fair value of contingent earn-out payment | 37,000,000 | ||||||
Post-combination expense | 1,500,000 | ||||||
Gross payments to acquire business attributable to vested portion of stock options | $ 17,300,000 | ||||||
Cash to settle unvested stock options recognized as share-based compensation expense | $ 8,700,000 | ||||||
Weighted-average estimated useful life of finite-lived intangible assets acquired | 13 years | ||||||
Deferred tax liability acquired in connection with the acquired intangibles | $ (53,296,000) | ||||||
Deferred revenue acquired | (3,908,000) | ||||||
Pfenex | Contractual Relationships | |||||||
Business Acquisition [Line Items] | |||||||
Finite-lived intangible assets acquired | $ 362,000,000 | ||||||
Weighted-average estimated useful life of finite-lived intangible assets acquired | 12 years 10 months 24 days | ||||||
Pfenex | Core Technology | |||||||
Business Acquisition [Line Items] | |||||||
Finite-lived intangible assets acquired | $ 23,000,000 | ||||||
Pfenex | Core Technology | Minimum | |||||||
Business Acquisition [Line Items] | |||||||
Discount rate used to value intangible assets acquired (as a percent) | 12.00% | ||||||
Pfenex | Core Technology | Maximum | |||||||
Business Acquisition [Line Items] | |||||||
Discount rate used to value intangible assets acquired (as a percent) | 15.00% | ||||||
Pfenex | Discount Rate | |||||||
Business Acquisition [Line Items] | |||||||
Contingent consideration liability, measurement input (as a percent) | 0.071 | ||||||
Taurus | |||||||
Business Acquisition [Line Items] | |||||||
Consideration transferred in acquisition | $ 5,100,000 | ||||||
Cash payments for acquisition | 4,600,000 | ||||||
Contingent earn-out payment | 0 | ||||||
Holdback from acquisition | 500,000 | ||||||
Tangible assets acquired | 50,000 | ||||||
Taurus | Contingent Value Right for Internal Research and Development | |||||||
Business Acquisition [Line Items] | |||||||
Contingent earn-out payment | 4,500,000 | ||||||
Taurus | Contingent Value Right on Product Revenues | |||||||
Business Acquisition [Line Items] | |||||||
Contingent earn-out payment | $ 25,000,000 | ||||||
Proportion of milestone payments (as a percent) | 25.00% | ||||||
Taurus | Core Technology | |||||||
Business Acquisition [Line Items] | |||||||
Finite-lived intangible assets acquired | $ 5,000,000 | ||||||
Weighted-average estimated useful life of finite-lived intangible assets acquired | 10 years | ||||||
xCella | |||||||
Business Acquisition [Line Items] | |||||||
Consideration transferred in acquisition | $ 7,100,000 | ||||||
Contingent earn-out payment | 0 | ||||||
Holdback from acquisition | 500,000 | ||||||
Tangible assets acquired | 200,000 | ||||||
Liabilities assumed | (100,000) | ||||||
Deferred tax liability acquired in connection with the acquired intangibles | (800,000) | ||||||
xCella | Earnout Rights for Partner Research and Development | |||||||
Business Acquisition [Line Items] | |||||||
Contingent earn-out payment | 5,000,000 | ||||||
Earnout rights recognized | $ 0 | $ 200,000 | |||||
xCella | Milestone Payments | |||||||
Business Acquisition [Line Items] | |||||||
Contingent earn-out payment | $ 25,750,000 | ||||||
Proportion of milestone payments (as a percent) | 25.00% | ||||||
xCella | Core Technology | |||||||
Business Acquisition [Line Items] | |||||||
Finite-lived intangible assets acquired | $ 7,800,000 | ||||||
Weighted-average estimated useful life of finite-lived intangible assets acquired | 15 years | ||||||
Icagen | |||||||
Business Acquisition [Line Items] | |||||||
Consideration transferred in acquisition | $ 19,900,000 | ||||||
Cash payments for acquisition | 15,100,000 | ||||||
Contingent earn-out payment | 25,000,000 | ||||||
Fair value of contingent earn-out payment | 4,800,000 | ||||||
Finite-lived intangible assets acquired | $ 12,800,000 | ||||||
Weighted-average estimated useful life of finite-lived intangible assets acquired | 9 years 8 months 12 days | ||||||
Tangible assets acquired | $ 1,800,000 | ||||||
Liabilities assumed | (800,000) | ||||||
Acquisition related costs | 0 | ||||||
Deferred revenue acquired | (3,700,000) | ||||||
Deferred tax assets acquired | 800,000 | ||||||
Goodwill acquired | 9,000,000 | ||||||
Icagen | Core Technology | |||||||
Business Acquisition [Line Items] | |||||||
Finite-lived intangible assets acquired | $ 1,700,000 | ||||||
Weighted-average estimated useful life of finite-lived intangible assets acquired | 10 years | ||||||
Discount rate used to value intangible assets acquired (as a percent) | 17.00% | ||||||
Icagen | Customer Relationships | |||||||
Business Acquisition [Line Items] | |||||||
Finite-lived intangible assets acquired | $ 11,100,000 | ||||||
Weighted-average estimated useful life of finite-lived intangible assets acquired | 9 years 7 months 6 days | ||||||
Discount rate used to value intangible assets acquired (as a percent) | 17.00% |
Acquisitions - Assets Acquired
Acquisitions - Assets Acquired and Liabilities Assumed (Details) - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 | Oct. 01, 2020 |
Business Acquisition [Line Items] | |||
Goodwill | $ 190,517,000 | $ 189,662,000 | |
Pfenex | |||
Business Acquisition [Line Items] | |||
Cash | $ 51,407,000 | ||
Restricted cash | 200,000 | ||
Accounts and unbilled receivables | 1,359,000 | ||
Property and equipment, net | 7,823,000 | ||
Right-of-use asset | 3,070,000 | ||
Other assets | 1,338,000 | ||
Intangibles acquired | 385,000,000 | ||
Goodwill | 91,837,000 | ||
Accounts payable | (6,814,000) | ||
Accrued liabilities | (8,455,000) | ||
Deferred revenue | (3,908,000) | ||
Lease liabilities | (3,070,000) | ||
Other liabilities | (1,382,000) | ||
Deferred tax liabilities, net | (53,296,000) | ||
Total consideration | 465,109,000 | ||
Goodwill acquired that is expected to be deductible for tax purposes | $ 0 |
Acquisitions - Pro Forma Financ
Acquisitions - Pro Forma Financial Information (Details) - Pfenex - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2020 | Jun. 30, 2020 | |
Business Acquisition [Line Items] | ||
Revenue | $ 42,201 | $ 76,044 |
Net income (loss) | $ 7,435 | $ (30,505) |
Net income (loss) per common share: | ||
Basic (USD per share) | $ 0.46 | $ (1.87) |
Diluted (USD per share) | $ 0.45 | $ (1.87) |
Convertible Senior Notes - Narr
Convertible Senior Notes - Narrative (Details) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||
Mar. 31, 2021USD ($)optionshares | May 31, 2018USD ($)d$ / sharesshares | Jun. 30, 2021USD ($) | Mar. 31, 2021USD ($)optionshares | Mar. 31, 2020USD ($) | Jun. 30, 2021USD ($) | Jun. 30, 2020USD ($) | Dec. 31, 2020USD ($) | |
Debt Instrument [Line Items] | ||||||||
Loss on extinguishment of debt | $ 7,175,000 | $ (659,000) | ||||||
Adjustments to additional paid in capital, equity component of convertible debt | $ 1,073,000 | $ 9,086,000 | $ 2,745,000 | |||||
Adjustments to additional paid-in-capital from warrants | $ 400,000 | |||||||
Payments to unwind warrants | 16,500,000 | |||||||
Proceeds from unwinding convertible bond hedges | $ 16,900,000 | |||||||
Number of options under convertible bond hedges | option | 645,500 | 645,500 | ||||||
Convertible Notes | 2023 Convertible Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount outstanding | $ 750,000,000 | 345,729,000 | 345,729,000 | $ 495,280,000 | ||||
Interest rate (as a percent) | 0.75% | |||||||
Proceeds from debt, net of issuance costs | $ 733,100,000 | |||||||
Initial conversion rate (shares per $1,000) | 0.0040244 | |||||||
Initial conversion price (USD per share) | $ / shares | $ 248.48 | |||||||
Debt issuance costs | 16,900,000 | 16,900,000 | ||||||
Debt premium | 13,700,000 | 13,700,000 | ||||||
Repurchased amount of debt instrument | $ 104,500,000 | $ 149,600,000 | $ 104,500,000 | 149,600,000 | ||||
Repayments of notes | 109,100,000 | 153,700,000 | ||||||
Accrued Interest | $ 200,000 | 300,000 | ||||||
Loss on extinguishment of debt | 7,200,000 | |||||||
Increase (decrease) in debt discount | 13,500,000 | |||||||
Adjustments to additional paid in capital, equity component of convertible debt | $ 10,200,000 | |||||||
Warrants issued in public offering (shares) | shares | 2,597,750 | 3,018,327 | 2,597,750 | |||||
Payments for convertible bond hedges | $ 140,300,000 | |||||||
Warrant exercise price (USD per share) | $ / shares | $ 315.38 | |||||||
Adjustments to additional paid-in-capital from warrants | $ 90,000,000 | |||||||
Convertible Notes | 2023 Convertible Senior Notes | Debt Instrument, Redemption, Period One | ||||||||
Debt Instrument [Line Items] | ||||||||
Threshold trading days | d | 20 | |||||||
Consecutive trading days | d | 30 | |||||||
Stock price trigger to classify convertible debt as current (as a percent) | 130.00% | |||||||
Convertible Notes | 2023 Convertible Senior Notes | Debt Instrument, Redemption, Period Two | ||||||||
Debt Instrument [Line Items] | ||||||||
Threshold trading days | d | 5 | |||||||
Consecutive trading days | d | 10 | |||||||
Maximum threshold of debt trading price trigger (as a percent) | 98.00% |
Convertible Senior Notes - Note
Convertible Senior Notes - Notes Payable (Details) - Convertible Notes - 2023 Convertible Senior Notes - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 | May 31, 2018 |
Notes Payable, Current and Noncurrent [Abstract] | |||
Principal amount of the 2023 Notes outstanding | $ 345,729,000 | $ 495,280,000 | $ 750,000,000 |
Unamortized discount (including unamortized debt issuance cost) | (30,411,000) | (52,987,000) | |
Total long-term portion of notes payable | 315,318,000 | 442,293,000 | |
Carrying value of equity component of the 2023 Notes | 27,776,000 | 48,397,000 | |
Fair value of the 2023 Notes outstanding (Level 2) | $ 341,687,000 | $ 466,053,000 |
Income Tax (Details)
Income Tax (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Income Tax Examination [Line Items] | ||||
Effective income tax rate (as a percent) | 7.70% | 21.50% | (25.00%) | 10.90% |
Contingent liabilities - Pfenex | ||||
Income Tax Examination [Line Items] | ||||
Reduction in contingent liability | $ 34.1 | $ 33.8 |
Stockholders' Equity - Stock Op
Stockholders' Equity - Stock Option Plan and Restricted Stock Activity (Details) | 6 Months Ended |
Jun. 30, 2021$ / sharesshares | |
Stock Options | |
Shares | |
Balance at beginning of period (shares) | shares | 2,561,822 |
Granted (shares) | shares | 318,381 |
Options exercised (shares) | shares | (533,451) |
Forfeited (shares) | shares | (83,489) |
Balance at end of period (shares) | shares | 2,263,263 |
Weighted-Average Exercise Price | |
Balance at beginning of period (USD per share) | $ / shares | $ 85.59 |
Granted (USD per share) | $ / shares | 164.30 |
Options exercised (USD per share) | $ / shares | 52 |
Forfeited (USD per share) | $ / shares | 106.98 |
Balance at end of period (USD per share) | $ / shares | $ 103.79 |
Restricted Stock Awards | |
Restricted Stock Awards | |
Nonvested at beginning of period (shares) | shares | 206,202 |
Granted (shares) | shares | 158,456 |
RSUs vested (shares) | shares | (95,607) |
Forfeited (shares) | shares | (6,790) |
Nonvested at end of period (shares) | shares | 262,261 |
Weighted-Average Grant Date Fair Value | |
Nonvested at beginning of period (USD per share) | $ / shares | $ 106.88 |
Granted (USD per share) | $ / shares | 171.44 |
RSUs vested (USD per share) | $ / shares | 126.49 |
Forfeited (USD per share) | $ / shares | 126.23 |
Nonvested at end of period (USD per share) | $ / shares | $ 138.23 |
Stockholders' Equity - Narrativ
Stockholders' Equity - Narrative (Details) - USD ($) | Sep. 11, 2019 | Mar. 31, 2020 | Jun. 30, 2021 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Outstanding options that are exercisable (shares) | 1,300,000 | ||
Outstanding options that are exercisable, weighted average exercise price (USD per share) | $ 91.50 | ||
Employee Stock Purchase Plan | |||
Stock repurchased during period | $ 73,287,000 | $ 0 | |
Authorized stock repurchase amount | $ 500,000,000 | ||
Period in force of stock repurchase program | 3 years | ||
Remaining authorized stock repurchase amount | $ 248,800,000 | ||
Employee Stock Purchase Plan | |||
Employee Stock Purchase Plan | |||
Share purchase price as percent of market price (as a percent) | 85.00% | ||
Shares available for future purchases (shares) | 46,866 |
Commitment and Contingencies__2
Commitment and Contingencies: Legal Proceedings (Details) | Oct. 31, 2019civil_complaint | Oct. 29, 2019patent | May 31, 2020petition | Aug. 31, 2019petition |
Lupin Patent Infringement | ||||
Gain Contingencies [Line Items] | ||||
Number of patents allegedly infringed upon | patent | 4 | |||
US District Court for the Northern District of Ohio | ||||
Gain Contingencies [Line Items] | ||||
Number of civil complaints filed against entity | civil_complaint | 3 | |||
Inter Partes Review of Patent | Pfenex | ||||
Gain Contingencies [Line Items] | ||||
Number of petitions filed | 3 | |||
Inter Partes Review of Patent | GSK | ||||
Gain Contingencies [Line Items] | ||||
Number of petitions filed | 2 |
Uncategorized Items - lgnd-2021
Label | Element | Value |
Accounting Standards Update [Extensible Enumeration] | us-gaap_AccountingStandardsUpdateExtensibleList | Accounting Standards Update 2016-13 [Member] |