Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2016 | May. 03, 2016 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | CTIC | |
Entity Registrant Name | CTI BIOPHARMA CORP | |
Entity Central Index Key | 891,293 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 282,930,067 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 104,641 | $ 128,182 |
Accounts receivable, net | 666 | 282 |
Inventory, net | 2,911 | 2,845 |
Prepaid expenses and other current assets | 5,724 | 3,666 |
Total current assets | 113,942 | 134,975 |
Property and equipment, net | 3,617 | 3,718 |
Other assets | 5,882 | 5,504 |
Total assets | 123,441 | 144,197 |
Current liabilities: | ||
Accounts payable | 17,712 | 10,584 |
Accrued expenses | 18,954 | 22,133 |
Current portion of deferred revenue | 646 | 578 |
Current portion of long-term debt | 7,285 | 37,371 |
Other current liabilities | 1,757 | 1,743 |
Total current liabilities | 46,354 | 72,409 |
Deferred revenue, less current portion | 933 | 1,110 |
Long-term debt, less current portion | 17,314 | 19,124 |
Other liabilities | 4,097 | 4,141 |
Total liabilities | $ 68,698 | $ 96,784 |
Commitments and contingencies | ||
Shareholders' equity: | ||
Common stock, no par value: Authorized shares - 315,000,000, Issued and outstanding shares - 280,346,792 and 280,461,097 at March 31, 2016 and December 31, 2015, respectively | $ 2,161,013 | $ 2,157,300 |
Accumulated other comprehensive loss | (6,325) | (6,952) |
Accumulated deficit | (2,095,005) | (2,098,317) |
Total CTI shareholders' equity | 59,683 | 52,031 |
Noncontrolling interest | (4,940) | (4,618) |
Total shareholders' equity | 54,743 | 47,413 |
Total liabilities and shareholders' equity | $ 123,441 | $ 144,197 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Common stock, no par value (in dollars per share) | $ 0 | $ 0 |
Common stock, authorized shares | 315,000,000 | 315,000,000 |
Common stock, issued shares | 280,346,792 | 280,461,097 |
Common stock, outstanding shares | 280,346,792 | 280,461,097 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Revenues: | ||
Product sales, net | $ 1,223 | $ 805 |
License and contract revenue | 35,252 | 1,923 |
Total revenues | 36,475 | 2,728 |
Operating costs and expenses: | ||
Cost of product sold | 190 | 190 |
Research and development | 20,846 | 17,471 |
Selling, general and administrative | 11,312 | 12,297 |
Other operating expense | 0 | 253 |
Total operating costs and expenses | 32,348 | 30,211 |
Income (loss) from operations | 4,127 | (27,483) |
Non-operating income (expense): | ||
Interest expense | (714) | (494) |
Amortization of debt discount and issuance costs | (101) | (180) |
Foreign exchange gain (loss) | 198 | (728) |
Other non-operating expense | (519) | 0 |
Total non-operating expense, net | (1,136) | (1,402) |
Net income (loss) before noncontrolling interest | 2,991 | (28,885) |
Noncontrolling interest | 321 | 288 |
Net income (loss) | $ 3,312 | $ (28,597) |
Net income (loss) per common share: | ||
Basic (in dollars per share) | $ 0.01 | $ (0.16) |
Diluted (in dollars per share) | $ 0.01 | $ (0.16) |
Shares used in calculation of earnings (loss) per common share: | ||
Basic (in shares) | 277,930 | 173,936 |
Diluted (in shares) | 278,156 | 173,936 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | ||
Net income (loss) before noncontrolling interest | $ 2,991 | $ (28,885) |
Other comprehensive income (loss): | ||
Foreign currency translation adjustments | (1,363) | 2,247 |
Unrealized foreign exchange gain (loss) on intercompany balance | 1,470 | (2,754) |
Other-than-temporary impairment on available-for-sale securities | 519 | 0 |
Net unrealized income on securities available-for-sale | 1 | 5 |
Other comprehensive income (loss) | 627 | (502) |
Comprehensive income (loss) | 3,618 | (29,387) |
Comprehensive loss attributable to noncontrolling interest | 321 | 288 |
Comprehensive income (loss) attributable to CTI | $ 3,939 | $ (29,099) |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Operating activities | ||
Net income (loss) | $ 2,991 | $ (28,885) |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||
Baxalta milestone revenue | (32,000) | 0 |
Share-based compensation expense | 3,826 | 4,336 |
Depreciation and amortization | 232 | 261 |
Provision for bad debt | 321 | 0 |
Other-than-temporary impairment on available-for-sale securities | 519 | 0 |
Noncash interest expense | 101 | 180 |
Other | (106) | (93) |
Changes in operating assets and liabilities: | ||
Accounts receivable | (679) | 537 |
Inventory | 68 | 125 |
Prepaid expenses and other current assets | (2,004) | (939) |
Other assets | (76) | 1,219 |
Accounts payable | 7,120 | 4,331 |
Accrued expenses | (3,265) | (4,861) |
Deferred revenue | (108) | (214) |
Total adjustments | (26,051) | 4,882 |
Net cash used in operating activities | (23,060) | (24,003) |
Investing activities | ||
Purchases of property and equipment | (29) | (24) |
Net cash used in investing activities | (29) | (24) |
Financing activities | ||
Repayment of Hercules debt | 0 | (2,297) |
Payment of tax withholding obligations related to stock compensation | (113) | (527) |
Other | (136) | (213) |
Net cash used in financing activities | (249) | (3,037) |
Effect of exchange rate changes on cash and cash equivalents | (203) | 526 |
Net decrease in cash and cash equivalents | (23,541) | (26,538) |
Cash and cash equivalents at beginning of period | 128,182 | 70,933 |
Cash and cash equivalents at end of period | 104,641 | 44,395 |
Supplemental disclosure of cash flow information | ||
Cash paid during the period for interest | 2,472 | 524 |
Cash paid during the period for taxes | 0 | 0 |
Supplemental disclosure of noncash financing and investing activities | ||
Baxalta milestone advance - earned in lieu of repayment | $ (32,000) | $ 0 |
Description of Business and Sum
Description of Business and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Description of Business and Summary of Significant Accounting Policies | Description of Business and Summary of Significant Accounting Policies CTI BioPharma Corp., together with its wholly-owned subsidiaries, also referred to collectively in this Quarterly Report on Form 10-Q as “we,” “us,” “our,” the “Company” and “CTI”, is a biopharmaceutical company focused on the acquisition, development and commercialization of novel targeted therapies covering a spectrum of blood-related cancers that offer a unique benefit to patients and health care providers. Our goal is to build a profitable company by generating income from products we develop and commercialize, either alone or with partners. We are currently concentrating our efforts on treatments that target blood-related cancers where there is an unmet medical need. In particular, we are primarily focused on commercializing PIXUVRI in select countries in the European Union, or the E.U., for multiply relapsed or refractory aggressive B-cell non-Hodgkin lymphoma, or NHL, and evaluating pacritinib for the treatment of adult patients with myelofibrosis. We operate in a highly regulated and competitive environment. The manufacturing and marketing of pharmaceutical products require approval from, and are subject to, ongoing oversight by the Food and Drug Administration, or the FDA, in the United States, or the U.S., the European Medicines Agency, or the EMA, in the E.U. and comparable agencies in other countries. Obtaining approval for a new therapeutic product is never certain, may take many years and may involve expenditure of substantial resources. Basis of Presentation The accompanying unaudited financial information of CTI as of and for the three months ended March 31, 2016 and 2015 has been prepared in accordance with accounting principles generally accepted in the U.S. for interim financial information and with the instructions to Quarterly Report on Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, such financial information includes all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation of our financial position at such date and the operating results and cash flows for such periods. Operating results for the three months ended March 31, 2016 are not necessarily indicative of the results that may be expected for the entire year or for any other subsequent interim period. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted pursuant to the rules of the U.S. Securities and Exchange Commission, or the SEC. These unaudited financial statements and related notes should be read in conjunction with our audited annual financial statements for the year ended December 31, 2015 included in our Annual Report on Form 10-K filed with the SEC on February 17, 2016. The condensed consolidated balance sheet at December 31, 2015 has been derived from the audited financial statements at that date, but does not include all of the information and footnotes required by generally accepted accounting principles in the U.S. for complete financial statements. Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of CTI and its wholly-owned subsidiaries, which include Systems Medicine LLC and CTI Life Sciences Limited, or CTILS. We also retain ownership of our branch, CTI BioPharma Corp.– Sede Secondaria, or CTI (Europe); however, we ceased operations related to this branch in September 2009. As of March 31, 2016 , we also had a 60% interest in our majority-owned subsidiary, Aequus Biopharma, Inc., or Aequus. The remaining interest in Aequus not held by CTI is reported as noncontrolling interest in the consolidated financial statements. All intercompany transactions and balances are eliminated in consolidation. Accounts Receivable Our accounts receivable balance includes trade receivables related to PIXUVRI sales. We estimate an allowance for doubtful accounts based upon the age of outstanding receivables and our historical experience of collections, which includes adjustments for risk of loss for specific customer accounts. We periodically review the estimation process and make changes to our assumptions as necessary. When it is deemed probable that a customer account is uncollectible, the account balance is written off against the existing allowance. We also consider the customers’ country of origin to determine if an allowance is required. We continue to monitor economic conditions, including the volatility associated with international economies, the sovereign debt crisis in certain European countries and associated impacts on the financial markets and our business. As of March 31, 2016 and December 31, 2015 , our accounts receivable did not include any balance from a customer in a country that has exhibited financial stress that would have had a material impact on our financial results. We recorded no allowance for doubtful accounts as of March 31, 2016 and as of December 31, 2015 . Liquidity The accompanying consolidated financial statements have been prepared assuming that we will continue as a going concern, which contemplates realization of assets and the satisfaction of liabilities in the normal course of business for the twelve-month period following the date of these consolidated financial statements. We will need to continue to conduct research, development, testing and regulatory compliance activities with respect to our compounds and ensure the procurement of manufacturing and drug supply services, the costs of which, together with projected general and administrative expenses, is expected to result in operating losses for the foreseeable future. We have incurred a net operating loss every year since our formation. As of March 31, 2016, we had an accumulated deficit of $2.1 billion , and we expect to continue to incur net losses. Our available cash and cash equivalents were $104.6 million as of March 31, 2016 . We believe that our present financial resources, together with milestone payments projected to be received under certain contractual agreements and our ability to control costs, will be sufficient to fund our operations at least through the next twelve months from the date these financial statements were issued. We may need to acquire additional funds in order to develop our business. We may seek to raise such capital through public or private equity financings, partnerships, collaborations, joint ventures, disposition of assets, debt financings or restructurings, bank borrowings or other sources of financing. Furthermore, we have a limited number of authorized shares of common stock available for issuance and additional funding may not be available on favorable terms or at all. If additional funds are raised by issuing equity securities, substantial dilution to existing shareholders may result. If we fail to obtain additional capital when needed, our ability to operate as a going concern will be harmed, and we may be required to delay, scale back or eliminate some or all of our research and development programs, reduce our selling, general and administrative expenses, be unable to attract and retain highly qualified personnel, be unable to obtain and maintain contracts necessary to continue our operations and at affordable rates with competitive terms, refrain from making our contractually required payments when due (including debt payments) and/or may be forced to cease operations, liquidate our assets and possibly seek bankruptcy protection. Value Added Tax Receivable Our European operations are subject to a value added tax, or VAT, which is usually applied to all goods and services purchased and sold throughout Europe. The VAT receivable was approximately $4.9 million and $4.7 million as of March 31, 2016 and December 31, 2015 , of which $4.4 million and $4.2 million was included in other assets and $0.5 million and $0.5 million was included in prepaid expenses and other current assets as of March 31, 2016 and December 31, 2015 , respectively. The collection period of VAT receivable for our European operations ranges from approximately three months to five years . For our Italian VAT receivable, the collection period is approximately three to five years. As of March 31, 2016 , the VAT receivable related to operations in Italy is approximately $4.5 million . We review our VAT receivable balance for impairment whenever events or changes in circumstances indicate the carrying amount might not be recoverable. Inventory We carry inventory at the lower of cost or market. The cost of finished goods and work in process is determined using the standard-cost method, which approximates actual cost based on a first-in, first-out method. Inventory includes the cost of materials, third-party contract manufacturing and overhead costs, quality control costs and shipping costs from the manufacturers to the final distribution warehouse associated with the distribution of PIXUVRI. Production costs for our other product candidates continue to be charged to research and development expense as incurred prior to regulatory approval or until our estimate for regulatory approval becomes probable. We review our inventories on a quarterly basis for impairment and reserves are established when necessary. Estimates of excess inventory consider our projected sales of the product and the remaining shelf lives of product. In the event we identify excess, obsolete or unsalable inventory, the value is written down to the net realizable value. Based on assessment of shelf lives and net realizable value of the product, a $1.3 million reserve for excess, obsolete or unsalable inventory was recorded as of each of March 31, 2016 and December 31, 2015 . Revenue Recognition We currently have conditional marketing authorization for PIXUVRI in the E.U. Revenue is recognized when there is persuasive evidence of the existence of an agreement, delivery has occurred, prices are fixed or determinable, and collectability is assured. Where the revenue recognition criteria are not met, we defer the recognition of revenue by recording deferred revenue until such time that all criteria under the provision are met. Product sales We primarily sell PIXUVRI through a limited number of wholesale distributors. We generally record product sales upon receipt of the product by the health care providers and certain distributors at which time title and risk of loss pass. Product sales are recorded net of distributor discounts, estimated government-mandated rebates, trade discounts, and estimated product returns. Reserves are established for these deductions and actual amounts incurred are offset against the applicable reserves. We reflect these reserves as either a reduction in the related account receivable or as an accrued liability depending on the nature of the sales deduction. These estimates are periodically reviewed and adjusted as necessary. Milestone payments Milestone payments under the collaboration agreement are generally aggregated into three categories for reporting purposes: (i) development milestones, (ii) regulatory milestones, and (iii) sales milestones. Development milestones are typically payable when a product candidate initiates or advances into different clinical trial phases. Regulatory milestones are typically payable upon submission for marketing approval with the FDA, or with the regulatory authorities of other countries, or on receipt of actual marketing approvals for the compound or for additional indications. Sales milestones are typically payable when annual sales reach certain levels. At the inception of each agreement that includes milestone payments, we evaluate whether each milestone is substantive and at risk to both parties on the basis of the contingent nature of the milestone. This evaluation includes an assessment of whether (a) the consideration is commensurate with either (1) the entity's performance to achieve the milestone, or (2) the enhancement of the value of the delivered item(s) as a result of a specific outcome resulting from the entity's performance to achieve the milestone, (b) the consideration relates solely to past performance and (c) the consideration is reasonable relative to all of the deliverables and payment terms within the arrangement. We evaluate factors such as the scientific, regulatory, commercial and other risks that must be overcome to achieve the respective milestone, the level of effort and investment required to achieve the respective milestone and whether the milestone consideration is reasonable relative to all deliverables and payment terms in the arrangement in making this assessment. Non-refundable development and regulatory milestones that are expected to be achieved as a result of our efforts during the period of substantial involvement are considered substantive and are recognized as revenue upon the achievement of the milestone, assuming all other revenue recognition criteria are met. Reimbursement Arrangements and Collaborative Arrangements We follow ASC 605-25, Revenue Recognition – Multiple-Element Arrangements and ASC 808, Collaborative Arrangements, if applicable, to determine the accounting of reimbursement arrangements under our collaborative research and development and commercialization agreements. Cost of Product Sold Cost of product sold includes third-party manufacturing costs, shipping costs, contractual royalties and other costs of PIXUVRI product sold. Cost of product sold also includes allowances for excess inventory that may expire and become unsalable. Foreign Currency Translation and Transaction Gains and Losses We record foreign currency translation adjustments and transaction gains and losses in accordance with ASC 830, Foreign Currency Matters. For our operations that have a functional currency other than the U.S. dollar, gains and losses resulting from the translation of the functional currency into U.S. dollars for financial statement presentation are not included in determining net loss, but are accumulated in the cumulative foreign currency translation adjustment account as a separate component of shareholders’ equity (deficit), except for intercompany transactions that are of a short-term nature with entities that are consolidated, combined or accounted for by the equity method in our consolidated financial statements. We and our subsidiaries also have transactions in foreign currencies other than the functional currency. We record transaction gains and losses in our consolidated statements of operations related to the recurring measurement and settlement of such transactions. The intercompany balance due from CTILS is considered to be of a long-term nature. A favorable unrealized foreign exchange gain of $1.5 million and unfavorable unrealized foreign exchange loss of $2.8 million was recorded in cumulative foreign currency translation adjustment account for the three months ended March 31, 2016 and 2015 , respectively. As of March 31, 2016 , the intercompany balance due from CTILS was €27.3 million (or $31.1 million upon conversion from euros as of March 31, 2016 ). As of December 31, 2015 , the intercompany balance due from CTILS was €27.2 million (or $29.5 million upon conversion from euros as of December 31, 2015 ). Net Income (Loss) Per Share Basic net income (loss) per share is calculated based on the net income (loss) attributable to common shareholders divided by the weighted average number of shares outstanding for the period excluding any dilutive effects of options, warrants, unvested share awards and convertible securities. Diluted net income (loss) per common share assumes the conversion of all dilutive convertible securities, such as convertible debt and convertible preferred stock using the if-converted method, and assumes the exercise or vesting of other dilutive securities, such as options, warrants and restricted stock using the treasury stock method. Recently Adopted Accounting Standards In November 2015, the Financial Accounting Standards Board, or the FASB, issued new guidance on the balance sheet classification of deferred taxes. To simplify presentation, the new guidance requires that all deferred tax assets and liabilities, along with any related valuation allowance, be classified as noncurrent on the balance sheet . The accounting standard is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2016. Early adoption is permitted. The adoption of this guidance did not have an impact on our consolidated financial statements. In April 2015, the FASB issued a new accounting standard which changes the presentation of debt issuance costs in financial statements. Under the new standard, an entity presents such costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of the costs is reported as interest expense. The accounting standard is effective for annual reporting periods beginning after December 15, 2015 and interim periods beginning after December 15, 2016. The adoption of this guidance did not have a material impact on our consolidated financial statements. Recently Issued Accounting Standards In May 2014, the FASB, issued a new financial accounting standard which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes current revenue recognition guidance. The accounting standard is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2017. Early adoption is permitted as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. We are currently evaluating the impact of this accounting standard on our consolidated financial statements. In August 2014, the FASB issued a new accounting standard which requires management to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern for each annual and interim reporting period and to provide related footnote disclosures in certain circumstances. The accounting standard is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2016. Early adoption is permitted. We are currently evaluating the impact of this accounting standard on our consolidated financial statements. In July 2015, FASB issued a new accounting guidance on simplifying the measurement of inventory which requires that inventory within the scope of the guidance be measured at the lower of cost and net realizable value. Prior to the issuance of the standard, inventory was measured at the lower of cost or market (where market was defined as replacement cost, with a ceiling of net realizable value and floor of net realizable value less a normal profit margin). The accounting guidance is effective for annual reporting periods (including interim periods within those periods) beginning after December 15, 2016. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on our financial position or results of operations. In January 2016, the FASB issued a new accounting standard on recognition and measurement of financial assets and financial liabilities. The accounting standard primarily affects the accounting for equity investments, financial liabilities under the fair value option, and the presentation and disclosure requirements for financial instruments. In addition, it includes a clarification related to the valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale debt securities. The accounting guidance is effective for annual reporting periods (including interim periods within those periods) beginning after December 15, 2017. Early adoption is permitted for the provision to record fair value changes for financial liabilities under the fair value option resulting from instrument-specific credit risk in other comprehensive income. The adoption of this standard is not expected to have a material impact on our financial position or results of operations. In February 2016, the FASB issued a new accounting guidance on accounting for leases which requires the lessees to recognize virtually all of their leases on the balance sheet (other than leases that meet the definition of a short-term lease). The accounting guidance is effective for annual reporting periods (including interim periods within those periods) beginning after December 15, 2018. Early adoption is permitted. We are currently evaluating the impact of this accounting standard on our consolidated financial statements. In March 2016, the FASB issued a new accounting guidance for employee share-based payments accounting. The accounting standard primarily affects the accounting for forfeitures, minimum statutory tax withholding requirements, and income tax effects related to share-based payments at settlement (or expiration). The accounting guidance is effective for annual reporting periods beginning after December 15, 2017 and interim periods within annual reporting periods beginning after December 15, 2018. Early adoption is permitted. We are currently evaluating the impact of this accounting standard on our consolidated financial statements. Reclassifications Certain prior year items have been reclassified to conform to current year presentation. |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 3 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share [Abstract] | |
Earnings (Loss) Per Share | Earnings (Loss) Per Share The numerator for both basic and diluted earnings (loss) per share, or EPS, is net income (loss). The denominator for basic EPS (referred to as basic shares) is the weighted average number of common shares outstanding during the period, whereas the denominator for diluted EPS (referred to as diluted shares) also takes into account the dilutive effect of outstanding stock options and restricted stock awards using the treasury stock method. Basic and diluted shares for the three months ended March 31, 2016 and 2015 were as follows (in thousands): Three Months Ended March 31, 2016 2015 Basic shares 277,930 173,936 Effect of dilutive securities 226 — Diluted shares 278,156 173,936 The effect of dilutive securities included unexercised stock options and unvested restricted stock. Equity awards, warrants, and unvested share rights aggregating 23.5 million for the three months ended March 31, 2016 were excluded from the calculation of diluted EPS because they were anti-dilutive. Equity awards, warrants, and unvested share rights aggregating 14.5 million shares for the three months ended March 31, 2015 , prior to the application of the treasury stock method, were excluded from the calculation of diluted EPS because they were anti-dilutive. |
Inventory
Inventory | 3 Months Ended |
Mar. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Inventory | Inventory The components of PIXUVRI inventory consisted of the following as of March 31, 2016 and December 31, 2015 (in thousands): March 31, 2016 December 31, 2015 Finished goods $ 946 $ 724 Work-in-process 3,291 3,386 Inventory, gross 4,237 4,110 Reserve for expiring inventory (1,326 ) (1,265 ) Inventory, net $ 2,911 $ 2,845 |
Milestone Payments
Milestone Payments | 3 Months Ended |
Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Milestone Payments | Milestone Payments Baxalta In June 2015 , we entered into the First Amendment, or the Pacritinib License Amendment, to the Development, Commercialization and License Agreement, or the Original Pacritinib License Agreement, dated as of November 14, 2013, with Baxter International Inc., or Baxter. Baxalta Incorporated and its affiliates, or Baxalta, have been assigned Baxter’s rights and obligations under the Original Pacritinib License Agreement. Pursuant to the Pacritinib License Amendment, two milestone payments in the aggregate amount of $32.0 million from Baxalta to us were accelerated from the schedule contemplated by the Original Pacritinib License Agreement relating to the following: the $12.0 million milestone payment payable in connection with the regulatory submission of the Marketing Authorization Application, or the MAA, to the EMA with respect to pacritinib, or the MAA Milestone, and the $20.0 million development milestone payment payable in connection with the first treatment dosing of the 300th patient enrolled per the protocol in PERSIST-2, or the PERSIST-2 Milestone. Under the Pacritinib License Amendment, each of the two milestone advances were bearing interest at an annual rate of 9% until the earlier of the date of the first occurrence of the respective milestone or the date that the respective advance plus accrued interest is repaid in full. In the first quarter of 2016 , we recorded $32.0 million in License and contract revenue . |
Legal Proceedings
Legal Proceedings | 3 Months Ended |
Mar. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Legal Proceedings | Legal Proceedings The Italian Tax Authority, or the ITA, issued notices of assessment to CTI (Europe) based on the ITA’s audit of CTI (Europe)’s VAT returns for the years 2003, 2005, 2006 and 2007, or, collectively, the VAT Assessments. The ITA audits concluded that CTI (Europe) did not collect and remit VAT on certain invoices issued to non-Italian clients for services performed by CTI (Europe). We believe that the services invoiced were non-VAT taxable consultancy services and that the VAT returns are correct as originally filed. We are defending ourselves against the assessments both on procedural grounds and on the merits of the case, although we can make no assurances regarding the ultimate outcomes of these cases. As of December 31, 2012, we reversed the entire reserve we had previously recorded relating to the VAT Assessments after having received favorable Provincial Tax Court rulings. In January 2013, our then remaining deposit for the VAT Assessments was refunded to us. The current status of the legal proceedings surrounding each respective VAT year return at issue is as follows: 2003. In June 2013, the Regional Tax Court issued decision no. 119/50/13 in regards to the 2003 VAT assessment, which accepted the appeal of the ITA and reversed the previous decision of the Provincial Tax Court. In January 2014, we were notified that the ITA requested partial payment of the 2003 VAT assessment in the amount of €0.4 million (or $0.6 million ), which we paid in March 2014. We believe that the decision of the Regional Tax Court did not carefully take into account our arguments and the documentation we filed, and in January 2014, we appealed such decision to the Italian Supreme Court both on procedural grounds and on the merits of the case. 2005, 2006 and 2007. The ITA has appealed to the Italian Supreme Court the decisions of the respective appellate Regional Tax Court, which ruled in our favor, with respect to each of the 2005, 2006 and 2007 VAT returns. If the final decisions of the Italian Supreme Court for the VAT Assessments are unfavorable to us, we may incur up to $10.7 million in losses for the VAT amount assessed including penalties, interest and fees upon conversion from euros as of March 31, 2016 . On February 10, 2016 and February 12, 2016, class action lawsuits entitled Ahrens v. CTI Biopharma Corp. et al , Case No. 1:16-cv-01044 and McGlothlin v. CTI Biopharma Corp. et al , Case No. C16-216, respectively, were filed in the United States District Court for the Southern District of New York and the United States District Court for the Western District of Washington, respectively, on behalf of shareholders that purchased or acquired the Company’s securities pursuant to our September 24, 2015 public offering and/or shareholders who otherwise acquired our stock between March 4, 2014 and February 9, 2016, inclusive. The complaints assert claims against the Company and certain of our current and former directors and officers for violations of the federal securities laws under Sections 11 and 15 of the Securities Act of 1933, as amended, or the Securities Act, and Sections 10 and 20 of the Securities Exchange Act of 1934, as amended, or the Exchange Act, Plaintiffs’ Securities Act claims allege that the Company’s Registration Statement and Prospectus for the September 24, 2015 public offering contained materially false and misleading statements and failed to disclose certain material adverse facts about the Company’s business, operations and prospects, including with respect to the clinical trials and prospects for pacritinib. Plaintiffs’ Exchange Act claims allege that the Company’s public disclosures were knowingly or recklessly false and misleading or omitted material adverse facts, again with a primary focus on the clinical trials and prospects for pacritinib. The lawsuits seek damages in an unspecified amount. We believe that the allegations contained in the complaints are without merit and intend to vigorously defend ourselves against all claims asserted therein. A reasonable estimate of the amount of any possible loss or range of loss cannot be made at this time and, as such, we have not recorded an accrual for any possible loss. On March 14, 2016, a Company shareholder filed a derivative lawsuit on behalf of the Company seeking damages for alleged harm to the Company caused by certain current and former officers and directors. The suit, Wei v. James A. Bianco, et al, 16-2-05818-3, was filed in King County Superior Court, Washington, and names as individual defendants James A. Bianco, Louis A. Bianco, Jack W. Singer, Bruce J. Seeley, John H. Bauer, Phillip M. Nudelman, Reed V. Tuckson, Karen Ignagni, Richard L. Love, Mary O. Mundinger and Frederick W. Telling. Consistent with the requirements of a derivative action, the Company is named as a nominal defendant against which no monetary relief is sought. The complaint alleges four claims: (1) breach of fiduciary duty; (2) abuse of control; (3) gross mismanagement; and (4) unjust enrichment (receiving compensation that was unjust in light of the alleged conduct). Each is based on the assertion that the Company made materially false and misleading statements and omitted material information from its disclosures about pacritinib and its safety. Plaintiff did not make a pre-suit demand on the current Board to investigate whether to pursue claims against officers or directors, instead claiming demand is excused because the named defendants lack independence, are not disinterested because they lack impartiality, received and want to continue to receive their compensation, have longstanding personal and business relationships, and cannot evaluate a demand since they are facing personal liability. Plaintiff has requested the court to award the Company the damages allegedly sustained as a result of the conduct and to direct the Company and the individual defendants to reform and improve the Company’s corporate governance to avoid future damages. We understand that the individuals named as defendants believe the allegations contained in the complaint lack merit and plan to vigorously defend themselves against all claims asserted therein. A reasonable estimate of the amount of any possible loss or range of loss cannot be made at this time and, as such, we have not recorded an accrual for any possible loss. We are also in the process of providing documents in response to a subpoena received from the SEC in January 2016. The SEC's subpoena requests, among other things; internal and external communications related to pacritinib Phase 3 trials, including communications with the independent data monitoring committee, or IDMC, for pacritinib's Phase 3 trials, our steering committee, our board of directors, our audit committee, representatives of Baxter and Baxalta, and the Food and Drug Administration, and other documents related to pacritinib. We believe that the SEC is seeking to determine whether there have been possible violations of the antifraud and certain other provisions of the federal securities laws related to the Company's disclosures concerning, among other things, the clinical test results of pacritinib. The SEC Staff's letter sent with the subpoena stated that the investigation is a fact-finding inquiry, and the investigation and subpoena do not mean that the SEC has concluded that we or anyone else has violated any law. We are cooperating with this investigation. In addition to the items discussed above, we are from time to time subject to legal proceedings and claims arising in the ordinary course of business. |
Share-based Compensation Expens
Share-based Compensation Expense | 3 Months Ended |
Mar. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-based Compensation Expense | Share-based Compensation Expense The following table summarizes share-based compensation expense for the three months ended March 31, 2016 and 2015 , which was allocated as follows (in thousands): Three Months Ended March 31, 2016 2015 Research and development $ 786 $ 990 Selling, general and administrative 3,040 3,346 Total share-based compensation expense $ 3,826 $ 4,336 For the three months ended March 31, 2016 and 2015 , we incurred share-based compensation expense due to the following types of awards (in thousands): Three Months Ended March 31, 2016 2015 Performance rights $ 360 $ 418 Restricted stock 2,071 3,372 Options 1,395 546 Total share-based compensation expense $ 3,826 $ 4,336 |
Other Comprehensive Income (Los
Other Comprehensive Income (Loss) | 3 Months Ended |
Mar. 31, 2016 | |
Equity [Abstract] | |
Other Comprehensive Income (Loss) | Other Comprehensive Income (Loss) Total accumulated other comprehensive income (loss) consisted of the following (in thousands): Net Unrealized Gain (Loss) and Impairment on Available-For- Sale Securities Foreign Currency Translation Adjustments Unrealized Foreign Exchange Gain (Loss) on Intercompany Balance Accumulated Other Comprehensive Loss December 31, 2015 $ (518 ) $ (3,849 ) $ (2,585 ) $ (6,952 ) Current period other comprehensive income (loss) 520 (1,363 ) 1,470 627 March 31, 2016 $ 2 $ (5,212 ) $ (1,115 ) $ (6,325 ) During the three months ended March 31, 2016, we recognized other-than-temporary impairment on our investment in available-for-sale securities of $0.5 million in our statements of operations. The value of available-for-sale securities of $21,000 was included in Prepaid expenses and other current assets as of March 31, 2016 and December 31, 2015 . |
Leases
Leases | 3 Months Ended |
Mar. 31, 2016 | |
Leases [Abstract] | |
Leases | Leases Our deferred rent balance was $3.9 million as of March 31, 2016 , of which $0.5 million was included in other current liabilities and $3.4 million was included in other liabilities . As of December 31, 2015 , our deferred rent balance was $4.0 million , of which $0.5 million was included in other current liabilities and $3.5 million was included in other liabilities . |
Description of Business and S15
Description of Business and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Description of Business | CTI BioPharma Corp., together with its wholly-owned subsidiaries, also referred to collectively in this Quarterly Report on Form 10-Q as “we,” “us,” “our,” the “Company” and “CTI”, is a biopharmaceutical company focused on the acquisition, development and commercialization of novel targeted therapies covering a spectrum of blood-related cancers that offer a unique benefit to patients and health care providers. Our goal is to build a profitable company by generating income from products we develop and commercialize, either alone or with partners. We are currently concentrating our efforts on treatments that target blood-related cancers where there is an unmet medical need. In particular, we are primarily focused on commercializing PIXUVRI in select countries in the European Union, or the E.U., for multiply relapsed or refractory aggressive B-cell non-Hodgkin lymphoma, or NHL, and evaluating pacritinib for the treatment of adult patients with myelofibrosis. We operate in a highly regulated and competitive environment. The manufacturing and marketing of pharmaceutical products require approval from, and are subject to, ongoing oversight by the Food and Drug Administration, or the FDA, in the United States, or the U.S., the European Medicines Agency, or the EMA, in the E.U. and comparable agencies in other countries. Obtaining approval for a new therapeutic product is never certain, may take many years and may involve expenditure of substantial resources. |
Basis of Presentation | Basis of Presentation The accompanying unaudited financial information of CTI as of and for the three months ended March 31, 2016 and 2015 has been prepared in accordance with accounting principles generally accepted in the U.S. for interim financial information and with the instructions to Quarterly Report on Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, such financial information includes all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation of our financial position at such date and the operating results and cash flows for such periods. Operating results for the three months ended March 31, 2016 are not necessarily indicative of the results that may be expected for the entire year or for any other subsequent interim period. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted pursuant to the rules of the U.S. Securities and Exchange Commission, or the SEC. These unaudited financial statements and related notes should be read in conjunction with our audited annual financial statements for the year ended December 31, 2015 included in our Annual Report on Form 10-K filed with the SEC on February 17, 2016. The condensed consolidated balance sheet at December 31, 2015 has been derived from the audited financial statements at that date, but does not include all of the information and footnotes required by generally accepted accounting principles in the U.S. for complete financial statements. |
Principles of Consolidation | Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of CTI and its wholly-owned subsidiaries, which include Systems Medicine LLC and CTI Life Sciences Limited, or CTILS. We also retain ownership of our branch, CTI BioPharma Corp.– Sede Secondaria, or CTI (Europe); however, we ceased operations related to this branch in September 2009. As of March 31, 2016 , we also had a 60% interest in our majority-owned subsidiary, Aequus Biopharma, Inc., or Aequus. The remaining interest in Aequus not held by CTI is reported as noncontrolling interest in the consolidated financial statements. All intercompany transactions and balances are eliminated in consolidation. |
Accounts Receivable | Accounts Receivable Our accounts receivable balance includes trade receivables related to PIXUVRI sales. We estimate an allowance for doubtful accounts based upon the age of outstanding receivables and our historical experience of collections, which includes adjustments for risk of loss for specific customer accounts. We periodically review the estimation process and make changes to our assumptions as necessary. When it is deemed probable that a customer account is uncollectible, the account balance is written off against the existing allowance. We also consider the customers’ country of origin to determine if an allowance is required. We continue to monitor economic conditions, including the volatility associated with international economies, the sovereign debt crisis in certain European countries and associated impacts on the financial markets and our business. As of March 31, 2016 and December 31, 2015 , our accounts receivable did not include any balance from a customer in a country that has exhibited financial stress that would have had a material impact on our financial results. We recorded no allowance for doubtful accounts as of March 31, 2016 and as of December 31, 2015 . |
Liquidity | Liquidity The accompanying consolidated financial statements have been prepared assuming that we will continue as a going concern, which contemplates realization of assets and the satisfaction of liabilities in the normal course of business for the twelve-month period following the date of these consolidated financial statements. We will need to continue to conduct research, development, testing and regulatory compliance activities with respect to our compounds and ensure the procurement of manufacturing and drug supply services, the costs of which, together with projected general and administrative expenses, is expected to result in operating losses for the foreseeable future. We have incurred a net operating loss every year since our formation. As of March 31, 2016, we had an accumulated deficit of $2.1 billion , and we expect to continue to incur net losses. Our available cash and cash equivalents were $104.6 million as of March 31, 2016 . We believe that our present financial resources, together with milestone payments projected to be received under certain contractual agreements and our ability to control costs, will be sufficient to fund our operations at least through the next twelve months from the date these financial statements were issued. We may need to acquire additional funds in order to develop our business. We may seek to raise such capital through public or private equity financings, partnerships, collaborations, joint ventures, disposition of assets, debt financings or restructurings, bank borrowings or other sources of financing. Furthermore, we have a limited number of authorized shares of common stock available for issuance and additional funding may not be available on favorable terms or at all. If additional funds are raised by issuing equity securities, substantial dilution to existing shareholders may result. If we fail to obtain additional capital when needed, our ability to operate as a going concern will be harmed, and we may be required to delay, scale back or eliminate some or all of our research and development programs, reduce our selling, general and administrative expenses, be unable to attract and retain highly qualified personnel, be unable to obtain and maintain contracts necessary to continue our operations and at affordable rates with competitive terms, refrain from making our contractually required payments when due (including debt payments) and/or may be forced to cease operations, liquidate our assets and possibly seek bankruptcy protection. |
Value Added Tax Receivable | Value Added Tax Receivable Our European operations are subject to a value added tax, or VAT, which is usually applied to all goods and services purchased and sold throughout Europe. The VAT receivable was approximately $4.9 million and $4.7 million as of March 31, 2016 and December 31, 2015 , of which $4.4 million and $4.2 million was included in other assets and $0.5 million and $0.5 million was included in prepaid expenses and other current assets as of March 31, 2016 and December 31, 2015 , respectively. The collection period of VAT receivable for our European operations ranges from approximately three months to five years . For our Italian VAT receivable, the collection period is approximately three to five years. As of March 31, 2016 , the VAT receivable related to operations in Italy is approximately $4.5 million . We review our VAT receivable balance for impairment whenever events or changes in circumstances indicate the carrying amount might not be recoverable. |
Inventory | Inventory We carry inventory at the lower of cost or market. The cost of finished goods and work in process is determined using the standard-cost method, which approximates actual cost based on a first-in, first-out method. Inventory includes the cost of materials, third-party contract manufacturing and overhead costs, quality control costs and shipping costs from the manufacturers to the final distribution warehouse associated with the distribution of PIXUVRI. Production costs for our other product candidates continue to be charged to research and development expense as incurred prior to regulatory approval or until our estimate for regulatory approval becomes probable. We review our inventories on a quarterly basis for impairment and reserves are established when necessary. Estimates of excess inventory consider our projected sales of the product and the remaining shelf lives of product. In the event we identify excess, obsolete or unsalable inventory, the value is written down to the net realizable value. Based on assessment of shelf lives and net realizable value of the product, a $1.3 million reserve for excess, obsolete or unsalable inventory was recorded as of each of March 31, 2016 and December 31, 2015 . |
Revenue Recognition | Revenue Recognition We currently have conditional marketing authorization for PIXUVRI in the E.U. Revenue is recognized when there is persuasive evidence of the existence of an agreement, delivery has occurred, prices are fixed or determinable, and collectability is assured. Where the revenue recognition criteria are not met, we defer the recognition of revenue by recording deferred revenue until such time that all criteria under the provision are met. Product sales We primarily sell PIXUVRI through a limited number of wholesale distributors. We generally record product sales upon receipt of the product by the health care providers and certain distributors at which time title and risk of loss pass. Product sales are recorded net of distributor discounts, estimated government-mandated rebates, trade discounts, and estimated product returns. Reserves are established for these deductions and actual amounts incurred are offset against the applicable reserves. We reflect these reserves as either a reduction in the related account receivable or as an accrued liability depending on the nature of the sales deduction. These estimates are periodically reviewed and adjusted as necessary. Milestone payments Milestone payments under the collaboration agreement are generally aggregated into three categories for reporting purposes: (i) development milestones, (ii) regulatory milestones, and (iii) sales milestones. Development milestones are typically payable when a product candidate initiates or advances into different clinical trial phases. Regulatory milestones are typically payable upon submission for marketing approval with the FDA, or with the regulatory authorities of other countries, or on receipt of actual marketing approvals for the compound or for additional indications. Sales milestones are typically payable when annual sales reach certain levels. At the inception of each agreement that includes milestone payments, we evaluate whether each milestone is substantive and at risk to both parties on the basis of the contingent nature of the milestone. This evaluation includes an assessment of whether (a) the consideration is commensurate with either (1) the entity's performance to achieve the milestone, or (2) the enhancement of the value of the delivered item(s) as a result of a specific outcome resulting from the entity's performance to achieve the milestone, (b) the consideration relates solely to past performance and (c) the consideration is reasonable relative to all of the deliverables and payment terms within the arrangement. We evaluate factors such as the scientific, regulatory, commercial and other risks that must be overcome to achieve the respective milestone, the level of effort and investment required to achieve the respective milestone and whether the milestone consideration is reasonable relative to all deliverables and payment terms in the arrangement in making this assessment. Non-refundable development and regulatory milestones that are expected to be achieved as a result of our efforts during the period of substantial involvement are considered substantive and are recognized as revenue upon the achievement of the milestone, assuming all other revenue recognition criteria are met. Reimbursement Arrangements and Collaborative Arrangements We follow ASC 605-25, Revenue Recognition – Multiple-Element Arrangements and ASC 808, Collaborative Arrangements, if applicable, to determine the accounting of reimbursement arrangements under our collaborative research and development and commercialization agreements. |
Cost of Product Sold | Cost of Product Sold Cost of product sold includes third-party manufacturing costs, shipping costs, contractual royalties and other costs of PIXUVRI product sold. Cost of product sold also includes allowances for excess inventory that may expire and become unsalable. |
Foreign Currency Translation and Transaction Gains and Losses | Foreign Currency Translation and Transaction Gains and Losses We record foreign currency translation adjustments and transaction gains and losses in accordance with ASC 830, Foreign Currency Matters. For our operations that have a functional currency other than the U.S. dollar, gains and losses resulting from the translation of the functional currency into U.S. dollars for financial statement presentation are not included in determining net loss, but are accumulated in the cumulative foreign currency translation adjustment account as a separate component of shareholders’ equity (deficit), except for intercompany transactions that are of a short-term nature with entities that are consolidated, combined or accounted for by the equity method in our consolidated financial statements. We and our subsidiaries also have transactions in foreign currencies other than the functional currency. We record transaction gains and losses in our consolidated statements of operations related to the recurring measurement and settlement of such transactions. The intercompany balance due from CTILS is considered to be of a long-term nature. A favorable unrealized foreign exchange gain of $1.5 million and unfavorable unrealized foreign exchange loss of $2.8 million was recorded in cumulative foreign currency translation adjustment account for the three months ended March 31, 2016 and 2015 , respectively. As of March 31, 2016 , the intercompany balance due from CTILS was €27.3 million (or $31.1 million upon conversion from euros as of March 31, 2016 ). As of December 31, 2015 , the intercompany balance due from CTILS was €27.2 million (or $29.5 million upon conversion from euros as of December 31, 2015 ). |
Net Income (Loss) Per Share | Net Income (Loss) Per Share Basic net income (loss) per share is calculated based on the net income (loss) attributable to common shareholders divided by the weighted average number of shares outstanding for the period excluding any dilutive effects of options, warrants, unvested share awards and convertible securities. Diluted net income (loss) per common share assumes the conversion of all dilutive convertible securities, such as convertible debt and convertible preferred stock using the if-converted method, and assumes the exercise or vesting of other dilutive securities, such as options, warrants and restricted stock using the treasury stock method. |
Recently Adopted and Issued Accounting Standards | Recently Adopted Accounting Standards In November 2015, the Financial Accounting Standards Board, or the FASB, issued new guidance on the balance sheet classification of deferred taxes. To simplify presentation, the new guidance requires that all deferred tax assets and liabilities, along with any related valuation allowance, be classified as noncurrent on the balance sheet . The accounting standard is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2016. Early adoption is permitted. The adoption of this guidance did not have an impact on our consolidated financial statements. In April 2015, the FASB issued a new accounting standard which changes the presentation of debt issuance costs in financial statements. Under the new standard, an entity presents such costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of the costs is reported as interest expense. The accounting standard is effective for annual reporting periods beginning after December 15, 2015 and interim periods beginning after December 15, 2016. The adoption of this guidance did not have a material impact on our consolidated financial statements. Recently Issued Accounting Standards In May 2014, the FASB, issued a new financial accounting standard which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes current revenue recognition guidance. The accounting standard is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2017. Early adoption is permitted as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. We are currently evaluating the impact of this accounting standard on our consolidated financial statements. In August 2014, the FASB issued a new accounting standard which requires management to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern for each annual and interim reporting period and to provide related footnote disclosures in certain circumstances. The accounting standard is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2016. Early adoption is permitted. We are currently evaluating the impact of this accounting standard on our consolidated financial statements. In July 2015, FASB issued a new accounting guidance on simplifying the measurement of inventory which requires that inventory within the scope of the guidance be measured at the lower of cost and net realizable value. Prior to the issuance of the standard, inventory was measured at the lower of cost or market (where market was defined as replacement cost, with a ceiling of net realizable value and floor of net realizable value less a normal profit margin). The accounting guidance is effective for annual reporting periods (including interim periods within those periods) beginning after December 15, 2016. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on our financial position or results of operations. In January 2016, the FASB issued a new accounting standard on recognition and measurement of financial assets and financial liabilities. The accounting standard primarily affects the accounting for equity investments, financial liabilities under the fair value option, and the presentation and disclosure requirements for financial instruments. In addition, it includes a clarification related to the valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale debt securities. The accounting guidance is effective for annual reporting periods (including interim periods within those periods) beginning after December 15, 2017. Early adoption is permitted for the provision to record fair value changes for financial liabilities under the fair value option resulting from instrument-specific credit risk in other comprehensive income. The adoption of this standard is not expected to have a material impact on our financial position or results of operations. In February 2016, the FASB issued a new accounting guidance on accounting for leases which requires the lessees to recognize virtually all of their leases on the balance sheet (other than leases that meet the definition of a short-term lease). The accounting guidance is effective for annual reporting periods (including interim periods within those periods) beginning after December 15, 2018. Early adoption is permitted. We are currently evaluating the impact of this accounting standard on our consolidated financial statements. In March 2016, the FASB issued a new accounting guidance for employee share-based payments accounting. The accounting standard primarily affects the accounting for forfeitures, minimum statutory tax withholding requirements, and income tax effects related to share-based payments at settlement (or expiration). The accounting guidance is effective for annual reporting periods beginning after December 15, 2017 and interim periods within annual reporting periods beginning after December 15, 2018. Early adoption is permitted. We are currently evaluating the impact of this accounting standard on our consolidated financial statements. |
Reclassifications | Reclassifications Certain prior year items have been reclassified to conform to current year presentation. |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Shares | Basic and diluted shares for the three months ended March 31, 2016 and 2015 were as follows (in thousands): Three Months Ended March 31, 2016 2015 Basic shares 277,930 173,936 Effect of dilutive securities 226 — Diluted shares 278,156 173,936 |
Inventory (Tables)
Inventory (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Components of Inventory | The components of PIXUVRI inventory consisted of the following as of March 31, 2016 and December 31, 2015 (in thousands): March 31, 2016 December 31, 2015 Finished goods $ 946 $ 724 Work-in-process 3,291 3,386 Inventory, gross 4,237 4,110 Reserve for expiring inventory (1,326 ) (1,265 ) Inventory, net $ 2,911 $ 2,845 |
Share-based Compensation Expe18
Share-based Compensation Expense (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of Share-Based Compensation Expense | The following table summarizes share-based compensation expense for the three months ended March 31, 2016 and 2015 , which was allocated as follows (in thousands): Three Months Ended March 31, 2016 2015 Research and development $ 786 $ 990 Selling, general and administrative 3,040 3,346 Total share-based compensation expense $ 3,826 $ 4,336 |
Share-Based Compensation Expense by Types of Awards | For the three months ended March 31, 2016 and 2015 , we incurred share-based compensation expense due to the following types of awards (in thousands): Three Months Ended March 31, 2016 2015 Performance rights $ 360 $ 418 Restricted stock 2,071 3,372 Options 1,395 546 Total share-based compensation expense $ 3,826 $ 4,336 |
Other Comprehensive Income (L19
Other Comprehensive Income (Loss) (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Equity [Abstract] | |
Total Accumulated Other Comprehensive Income (Loss) | Total accumulated other comprehensive income (loss) consisted of the following (in thousands): Net Unrealized Gain (Loss) and Impairment on Available-For- Sale Securities Foreign Currency Translation Adjustments Unrealized Foreign Exchange Gain (Loss) on Intercompany Balance Accumulated Other Comprehensive Loss December 31, 2015 $ (518 ) $ (3,849 ) $ (2,585 ) $ (6,952 ) Current period other comprehensive income (loss) 520 (1,363 ) 1,470 627 March 31, 2016 $ 2 $ (5,212 ) $ (1,115 ) $ (6,325 ) |
Description of Business and S20
Description of Business and Summary of Significant Accounting Policies (Detail) € in Millions | 3 Months Ended | ||||||
Mar. 31, 2016USD ($) | Mar. 31, 2015USD ($) | Mar. 31, 2016EUR (€) | Mar. 31, 2016USD ($) | Dec. 31, 2015EUR (€) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Description Of Business And Significant Accounting Policies [Line Items] | |||||||
Accumulated deficit | $ 2,095,005,000 | $ 2,098,317,000 | |||||
Allowance for doubtful accounts | 0 | 0 | |||||
Cash and cash equivalents | $ 44,395,000 | 104,641,000 | 128,182,000 | $ 70,933,000 | |||
VAT receivable | 4,900,000 | 4,700,000 | |||||
Reserve for excess, obsolete or unsalable inventory | 1,326,000 | 1,265,000 | |||||
Unrealized foreign exchange gain (loss) on intercompany balance | $ 1,470,000 | $ (2,754,000) | |||||
Intercompany foreign currency balance, amount | € 27.3 | 31,100,000 | € 27.2 | 29,500,000 | |||
Europe | Minimum | |||||||
Description Of Business And Significant Accounting Policies [Line Items] | |||||||
VAT receivable, collection period | 3 months | ||||||
Europe | Maximum | |||||||
Description Of Business And Significant Accounting Policies [Line Items] | |||||||
VAT receivable, collection period | 5 years | ||||||
Italy | |||||||
Description Of Business And Significant Accounting Policies [Line Items] | |||||||
VAT receivable | 4,500,000 | ||||||
Italy | Minimum | |||||||
Description Of Business And Significant Accounting Policies [Line Items] | |||||||
VAT receivable, collection period | 3 years | ||||||
Italy | Maximum | |||||||
Description Of Business And Significant Accounting Policies [Line Items] | |||||||
VAT receivable, collection period | 5 years | ||||||
Other Assets | |||||||
Description Of Business And Significant Accounting Policies [Line Items] | |||||||
VAT receivable, non-current | 4,400,000 | 4,200,000 | |||||
Prepaid Expenses and Other Current Assets | |||||||
Description Of Business And Significant Accounting Policies [Line Items] | |||||||
VAT receivable, current | $ 500,000 | $ 500,000 | |||||
Aequus Biopharma, Inc | Affiliated Entity | |||||||
Description Of Business And Significant Accounting Policies [Line Items] | |||||||
Interest in majority-owned subsidiary | 60.00% | 60.00% |
Earnings (Loss) Per Share (Deta
Earnings (Loss) Per Share (Detail) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Earnings Per Share [Abstract] | ||
Basic | 277,930 | 173,936 |
Effect of dilutive securities | 226 | 0 |
Diluted | 278,156 | 173,936 |
Anti-dilutive securities excluded from computation of earnings per share amount | 23,500 | 14,500 |
Inventory (Detail)
Inventory (Detail) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 946 | $ 724 |
Work-in-process | 3,291 | 3,386 |
Inventory, gross | 4,237 | 4,110 |
Reserve for expiring inventory | (1,326) | (1,265) |
Inventory, net | $ 2,911 | $ 2,845 |
Milestone Payments (Detail)
Milestone Payments (Detail) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016USD ($) | Mar. 31, 2015USD ($) | Jun. 30, 2015USD ($)Payment | |
Debt Instrument [Line Items] | |||
License and contract revenue | $ 35,252 | $ 1,923 | |
Borrowing Associated With License Agreement | |||
Debt Instrument [Line Items] | |||
Milestone payment | $ 32,000 | ||
Milestone advance interest rate | 9.00% | ||
Baxalta | Borrowing Associated With License Agreement | |||
Debt Instrument [Line Items] | |||
Number of milestone payments | Payment | 2 | ||
License and contract revenue | 32,000 | ||
License and contract revenue | $ 32,000 | ||
Baxalta | PERSIST-2 Milestone | Borrowing Associated With License Agreement | |||
Debt Instrument [Line Items] | |||
Milestone payment | $ 20,000 | ||
Baxalta | European Medicines Agency Milestone [Member] | Borrowing Associated With License Agreement | |||
Debt Instrument [Line Items] | |||
Milestone payment | $ 12,000 |
Legal Proceedings (Detail)
Legal Proceedings (Detail) - VAT Assessments € in Millions, $ in Millions | 1 Months Ended | ||
Mar. 31, 2014EUR (€) | Mar. 31, 2014USD ($) | Mar. 31, 2016USD ($) | |
Loss Contingencies [Line Items] | |||
VAT assessment paid | € 0.4 | $ 0.6 | |
Range of possible loss, maximum | $ 10.7 |
Share-based Compensation Expe25
Share-based Compensation Expense - Summary of Expense (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Share-based compensation expense | $ 3,826 | $ 4,336 |
Research and development | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Share-based compensation expense | 786 | 990 |
Selling, general and administrative | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Share-based compensation expense | $ 3,040 | $ 3,346 |
Share-based Compensation Expe26
Share-based Compensation Expense - Expense by Types of Awards (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Share-based compensation expense | $ 3,826 | $ 4,336 |
Performance rights | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Share-based compensation expense | 360 | 418 |
Restricted stock | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Share-based compensation expense | 2,071 | 3,372 |
Options | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Share-based compensation expense | $ 1,395 | $ 546 |
Other Comprehensive Income (L27
Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | |||
Beginning balance | $ (6,952) | ||
Current period other comprehensive income (loss) | 627 | $ (502) | |
Ending balance | (6,325) | ||
Other-than-temporary impairment loss on available-for-sale securities | 519 | $ 0 | |
Prepaid expenses and other current assets | 5,724 | $ 3,666 | |
Net Unrealized Gain (Loss) and Impairment on Available-For- Sale Securities | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | |||
Beginning balance | (518) | ||
Current period other comprehensive income (loss) | 520 | ||
Ending balance | 2 | ||
Prepaid expenses and other current assets | 21 | ||
Foreign Currency Translation Adjustments | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | |||
Beginning balance | (3,849) | ||
Current period other comprehensive income (loss) | (1,363) | ||
Ending balance | (5,212) | ||
Unrealized Foreign Exchange Gain (Loss) on Intercompany Balance | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | |||
Beginning balance | (2,585) | ||
Current period other comprehensive income (loss) | 1,470 | ||
Ending balance | $ (1,115) |
Leases (Detail)
Leases (Detail) - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
Leases [Abstract] | ||
Deferred rent credit | $ 3.9 | $ 4 |
Deferred rent credit, other current Liabilities | 0.5 | 0.5 |
Deferred rent credit, other liabilities | $ 3.4 | $ 3.5 |