Cover Page
Cover Page - USD ($) | 12 Months Ended | ||
Jan. 03, 2020 | Feb. 18, 2020 | Jun. 28, 2019 | |
Cover page. | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Jan. 3, 2020 | ||
Document Transition Report | false | ||
Entity File Number | 000-30235 | ||
Entity Registrant Name | EXELIXIS, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 04-3257395 | ||
Entity Address, Address Line One | 1851 Harbor Bay Parkway | ||
Entity Address, City or Town | Alameda, | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 94502 | ||
City Area Code | 650 | ||
Local Phone Number | 837-7000 | ||
Title of 12(b) Security | Common Stock $.001 Par Value per Share | ||
Trading Symbol | EXEL | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 5,731,439,777 | ||
Entity Common Stock, Shares Outstanding | 305,393,240 | ||
Documents Incorporated by Reference | Certain portions of the registrant’s definitive proxy statement to be filed with the Securities and Exchange Commission pursuant to Regulation 14A, not later than May 4, 2020, in connection with the registrant’s 2020 Annual Meeting of Stockholders are incorporated herein by reference into Part III of this Annual Report on Form 10-K. | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Entity Central Index Key | 0000939767 | ||
Current Fiscal Year End Date | --01-03 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jan. 03, 2020 | Dec. 28, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 266,501 | $ 314,775 |
Short-term investments | 585,742 | 378,559 |
Trade receivables, net | 119,073 | 162,771 |
Inventory, net | 12,886 | 9,838 |
Prepaid expenses and other current assets | 26,988 | 31,073 |
Total current assets | 1,011,190 | 897,016 |
Long-term investments | 536,385 | 158,287 |
Property and equipment, net | 48,892 | 50,897 |
Deferred tax assets, net | 172,374 | 244,111 |
Goodwill | 63,684 | 63,684 |
Other long-term assets | 53,145 | 8,291 |
Total assets | 1,885,670 | 1,422,286 |
Current liabilities: | ||
Accounts payable | 11,581 | 10,901 |
Accrued compensation and benefits | 37,364 | 32,142 |
Accrued clinical trial liabilities | 38,777 | 18,231 |
Rebates and fees due to customers | 18,719 | 14,954 |
Accrued collaboration liabilities | 11,856 | 7,419 |
Other current liabilities | 24,449 | 21,825 |
Total current liabilities | 142,746 | 105,472 |
Long-term portion of deferred revenue | 6,596 | 15,897 |
Long-term portion of operating lease liabilities | 48,011 | 12,099 |
Long-term portion of operating lease liabilities | 12,178 | |
Other long-term liabilities | 2,347 | 1,286 |
Total liabilities | 199,700 | 134,833 |
Commitments | ||
Stockholders’ equity: | ||
Preferred stock, $0.001 par value, 10,000 shares authorized and no shares issued | 0 | 0 |
Common stock, $0.001 par value; 400,000 shares authorized; issued and outstanding: 304,831 and 299,876 at December 31, 2019 and 2018, respectively | 305 | 300 |
Additional paid-in capital | 2,241,947 | 2,168,217 |
Accumulated other comprehensive income (loss) | 3,069 | (701) |
Accumulated deficit | (559,351) | (880,363) |
Total stockholders’ equity | 1,685,970 | 1,287,453 |
Total liabilities and stockholders’ equity | $ 1,885,670 | $ 1,422,286 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Jan. 03, 2020 | Dec. 28, 2018 |
Preferred stock | ||
Par value (in dollars per share) | $ 0.001 | $ 0.001 |
Shares authorized (in shares) | 10,000,000 | 10,000,000 |
Shares issued (in shares) | 0 | 0 |
Common stock | ||
Par value (in dollars per share) | $ 0.001 | $ 0.001 |
Shares authorized (in shares) | 400,000,000 | 400,000,000 |
Shares issued (in shares) | 304,831,000 | 299,876,000 |
Shares outstanding (in shares) | 304,831,000 | 299,876,000 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Revenues: | |||
Total revenues | $ 967,775 | $ 853,826 | $ 452,477 |
Operating expenses: | |||
Cost of goods sold | 33,097 | 26,348 | 15,066 |
Research and development | 336,964 | 182,257 | 112,171 |
Selling, general and administrative | 228,244 | 206,366 | 159,330 |
Total operating expenses | 598,305 | 414,971 | 286,567 |
Income from operations | 369,470 | 438,855 | 165,910 |
Other income (expense), net: | |||
Interest income | 27,959 | 12,840 | 4,883 |
Interest expense | 0 | 0 | (8,679) |
Other, net | 680 | 397 | (3,537) |
Total other income (expense), net | 28,639 | 13,237 | (7,333) |
Income before income taxes | 398,109 | 452,092 | 158,577 |
Income tax provision (benefit) | 77,097 | (237,978) | 4,350 |
Net income | $ 321,012 | $ 690,070 | $ 154,227 |
Net income per share: | |||
Basic (in dollars per share) | $ 1.06 | $ 2.32 | $ 0.52 |
Diluted (in dollars per share) | $ 1.02 | $ 2.21 | $ 0.49 |
Weighted-average common shares outstanding: | |||
Basic (in shares) | 302,584 | 297,892 | 293,588 |
Diluted (in shares) | 315,009 | 312,803 | 312,003 |
Net product revenues | |||
Revenues: | |||
Total revenues | $ 759,950 | $ 619,279 | $ 349,008 |
Collaboration revenues | |||
Revenues: | |||
Total revenues | $ 207,825 | $ 234,547 | $ 103,469 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 321,012 | $ 690,070 | $ 154,227 |
Other comprehensive income (loss): | |||
Net unrealized gains (losses) on available-for-sale securities, net of tax impact of $(1,049), $156, and $0, respectively | 3,770 | (354) | 69 |
Comprehensive income | $ 324,782 | $ 689,716 | $ 154,296 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Statement of Comprehensive Income [Abstract] | |||
Unrealized gains or losses on available-for-sale securities, tax impact | $ (1,049) | $ 156 | $ 0 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Deficit) - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit |
Balance at beginning of period at Dec. 30, 2016 | $ 89,318 | $ 290 | $ 2,072,591 | $ (416) | $ (1,983,147) |
Balance at beginning of period (in shares) at Dec. 30, 2016 | 289,924 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 154,227 | 154,227 | |||
Net unrealized gains (losses) on available-for-sale securities, net of tax impact of $(1,049), $156, and $0, respectively | 69 | 69 | |||
Issuance of common stock under equity incentive and stock purchase plans (in shares) | 5,408 | ||||
Issuance of common stock under equity incentive and stock purchase plans | 17,409 | $ 5 | 17,404 | ||
Issuance of common stock on exercise of warrants (in shares) | 877 | ||||
Issuance of common stock on exercise of warrants | 0 | $ 1 | (1) | ||
Stock-based compensation | 23,938 | 23,938 | |||
Balance at end of period (in shares) at Dec. 29, 2017 | 296,209 | ||||
Balance at end of period at Dec. 29, 2017 | 284,961 | $ 296 | 2,114,184 | (347) | (1,829,172) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 690,070 | 690,070 | |||
Net unrealized gains (losses) on available-for-sale securities, net of tax impact of $(1,049), $156, and $0, respectively | (354) | (354) | |||
Issuance of common stock under equity incentive and stock purchase plans (in shares) | 3,667 | ||||
Issuance of common stock under equity incentive and stock purchase plans | 13,411 | $ 4 | 13,407 | ||
Stock-based compensation | $ 40,626 | 40,626 | |||
Balance at end of period (in shares) at Dec. 28, 2018 | 299,876 | 299,876 | |||
Balance at end of period at Dec. 28, 2018 | $ 1,287,453 | $ 300 | 2,168,217 | (701) | (880,363) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 321,012 | 321,012 | |||
Net unrealized gains (losses) on available-for-sale securities, net of tax impact of $(1,049), $156, and $0, respectively | 3,770 | 3,770 | |||
Issuance of common stock under equity incentive and stock purchase plans (in shares) | 4,955 | ||||
Issuance of common stock under equity incentive and stock purchase plans | 17,133 | $ 5 | 17,128 | ||
Stock-based compensation | $ 56,602 | 56,602 | |||
Balance at end of period (in shares) at Jan. 03, 2020 | 304,831 | 304,831 | |||
Balance at end of period at Jan. 03, 2020 | $ 1,685,970 | $ 305 | $ 2,241,947 | $ 3,069 | $ (559,351) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Cash flows from operating activities: | |||
Net income | $ 321,012 | $ 690,070 | $ 154,227 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation | 8,348 | 4,915 | 1,187 |
Stock-based compensation | 56,602 | 40,626 | 23,938 |
Non-cash lease expense | 2,819 | 2,854 | 0 |
Deferred taxes | 71,002 | (244,111) | 0 |
Other, net | 88 | 1,129 | (6,795) |
Changes in operating assets and liabilities: | |||
Trade receivables, net | 43,716 | (85,471) | (43,299) |
Inventory | (5,731) | (3,181) | (3,319) |
Prepaid expenses and other assets | (5,723) | (8,525) | (378) |
Deferred revenue | (9,301) | 271 | 13,745 |
Accounts payable and other liabilities | 44,124 | 17,143 | 26,305 |
Net cash provided by operating activities | 526,956 | 415,720 | 165,611 |
Cash flows from investing activities: | |||
Purchases of property, equipment and other | (12,834) | (33,297) | (21,143) |
Proceeds from sale of property and equipment | 0 | 308 | 164 |
Purchases of investments | (1,182,682) | (557,832) | (319,090) |
Proceeds from sales and maturities of investments | 608,269 | 292,971 | 376,864 |
Net cash (used in) provided by investing activities | (587,247) | (297,850) | 36,795 |
Cash flows from financing activities: | |||
Proceeds from issuance of common stock under equity incentive and stock purchase plans | 22,499 | 17,278 | 22,423 |
Taxes paid related to net share settlement of equity awards | (9,904) | (7,574) | (6,563) |
Principal repayments of debt | 0 | 0 | (185,788) |
Other, net | (42) | (13) | 0 |
Net cash provided by (used in) financing activities | 12,553 | 9,691 | (169,928) |
Net (decrease) increase in cash, cash equivalents and restricted cash equivalents | (47,738) | 127,561 | 32,478 |
Cash, cash equivalents and restricted cash equivalents at beginning of period | 315,875 | 188,314 | 155,836 |
Cash, cash equivalents and restricted cash equivalents at end of period | 268,137 | 315,875 | 188,314 |
Supplemental cash flow disclosure: | |||
Cash paid for interest | 0 | 0 | 20,460 |
Cash paid for taxes | 7,873 | 10,677 | 538 |
Non-cash activities: | |||
Right-of-use assets obtained in exchange for lease obligations | 29,562 | 17,180 | |
Property and equipment deemed to have been acquired in build-to-suit lease | 0 | 0 | 14,530 |
Unpaid liabilities incurred for purchases of property and equipment | $ 26 | $ 802 | $ 524 |
Organization and Summary of Sig
Organization and Summary of Significant Accounting Policies | 12 Months Ended |
Jan. 03, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Summary of Significant Accounting Policies | ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization Exelixis, Inc. (Exelixis, we, our or us) is an oncology-focused biotechnology company that strives to accelerate the discovery, development and commercialization of new medicines for difficult-to-treat cancers. Our drug discovery and development capabilities and commercialization platform are the foundations upon which we intend to bring to market novel, effective and tolerable therapies to provide cancer patients with additional treatment options. Since we were founded in 1994, four products resulting from our discovery efforts have progressed through clinical development, received regulatory approval and established a commercial presence in various geographies around the world. Two are derived from cabozantinib, our flagship molecule, an inhibitor of multiple tyrosine kinases including MET, AXL, VEGF receptors and RET. Our cabozantinib products are: CABOMETYX® (cabozantinib) tablets approved for advanced renal cell carcinoma (RCC) and previously treated hepatocellular carcinoma (HCC); and COMETRIQ® (cabozantinib) capsules approved for progressive, metastatic medullary thyroid cancer. For these types of cancer, cabozantinib has become or is becoming a standard of care. Beyond these approved indications, cabozantinib is currently the focus of a broad clinical development program, and is being investigated both alone and in combination with other therapies in a wide variety of cancers. The other two products resulting from our discovery efforts are: COTELLIC® (cobimetinib), an inhibitor of MEK, approved as part of a combination regimen to treat advanced melanoma and marketed under a collaboration with Genentech, Inc. (a member of the Roche Group) (Genentech); and MINNEBRO® (esaxerenone), an oral, non-steroidal, selective blocker of the mineralocorticoid receptor (MR), approved for the treatment of hypertension in Japan and licensed to Daiichi Sankyo Company, Limited (Daiichi Sankyo). Basis of Presentation The accompanying Consolidated Financial Statements include the accounts of Exelixis and those of our wholly-owned subsidiaries. These entities’ functional currency is the U.S. dollar. All intercompany balances and transactions have been eliminated. We have made reclassifications to our prior years’ Consolidated Balance Sheet and Consolidated Statements of Cash Flows to conform to the current year’s presentation. These reclassifications had no effect on total current assets, total assets, total operating cash flows, total investing cash flows or total financing cash flows. We have adopted a 52- or 53-week fiscal year policy that ends on the Friday closest to December 31st. Fiscal year 2019, which was a 53-week fiscal year, ended on January 3, 2020, fiscal year 2018, which was a 52-week fiscal year, ended on December 28, 2018 and fiscal year 2017, which was a 52-week fiscal year, ended on December 29, 2017. For convenience, references in this report as of and for the fiscal years ended January 3, 2020, December 28, 2018 and December 29, 2017 are indicated as being as of and for the years ended December 31, 2019, 2018 and 2017, respectively. Segment Information We operate in one business segment that focuses on the discovery, development and commercialization of new medicines for difficult-to-treat cancers. Our Chief Executive Officer, as the chief operating decision-maker, manages and allocates resources to our operations on a total consolidated basis. Consistent with this decision-making process, our Chief Executive Officer uses consolidated, single-segment financial information for purposes of evaluating performance, forecasting future period financial results, allocating resources and setting incentive targets. All of our long-lived assets are located in the U.S. See “Note 2. Revenues” for enterprise-wide disclosures about product sales, revenues from major customers and revenues by geographic region. Use of Estimates The preparation of the accompanying Consolidated Financial Statements conforms to accounting principles generally accepted in the U.S., which requires management to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, equity, revenues and expenses, and related disclosures. On an ongoing basis, we evaluate our significant estimates. We base our estimates on historical experience and on various other market-specific and other relevant assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ materially from those estimates. Recently Adopted Accounting Pronouncements In the third quarter of 2019, we adopted ASU No. 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (ASU 2018-15). ASU 2018-15 requires a customer in a hosting arrangement that is a service contract to follow the guidance in Accounting Standards Codification (ASC) Subtopic 350-40 to determine which implementation costs to capitalize as an asset related to the service contract and which costs to expense. ASU 2018-15 requires capitalized implementation costs to be expensed over the term of the hosting arrangement, which includes reasonably certain renewals. We adopted ASU 2018-15 using the prospective transition method in the accompanying Consolidated Financial Statements. The adoption of ASU 2018-15 did not have a material impact on our Consolidated Financial Statements. In the first quarter of 2019, we adopted ASU 2018-02, Income Statement—Reporting Comprehensive Income (Topic 220) (ASU 2018-02). There was no financial impact from the adoption of ASU 2018-02 and we did not make an election to reclassify the income tax effects of the Tax Cuts and Jobs Act of 2017 from accumulated other comprehensive income (loss) to accumulated deficit. In connection with the adoption of ASU 2018-02, we adopted the individual unit of account approach for releasing income tax effects from accumulated other comprehensive income (loss). In the first quarter of 2019, we also adopted ASU 2017-08, Receivables—Nonrefundable Fees and Other Costs (Subtopic 310-20) (ASU 2017-08). ASU 2017-08 shortens the amortization period for certain callable debt securities held at a premium. Specifically, ASU 2017-08 requires the premium to be amortized to the earliest call date. ASU 2017-08 does not require an accounting change for securities held at a discount; the discount continues to be amortized to maturity. The adoption of ASU 2017-08 did not have a material impact on our Consolidated Financial Statements. Cash and Investments We consider all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash equivalents include high-grade, short-term investments in money market funds, certificates of deposit and marketable debt securities which are subject to minimal credit and market risk. We designate all investments in marketable debt securities as available-for-sale and therefore, report such investments at fair value, with unrealized gains and losses recorded in accumulated other comprehensive income (loss). For securities sold prior to maturity, the cost of securities sold is based on the specific identification method. We include realized gains and losses on the sale of investments in other income (expense), net in the accompanying Consolidated Statements of Income. We classify those investments that we do not require for use in current operations and that mature in more than 12 months as long-term investments in the accompanying Consolidated Balance Sheets. The classification of restricted cash equivalents as short-term or long-term is dependent upon the longer of the remaining term to maturity of the investment or the remaining term of the related restriction . We subject all of our investments to a quarterly impairment review. We recognize an impairment charge when a decline in the fair value of an investment below its cost basis is judged to be other-than-temporary. Factors considered in determining whether a loss is temporary include the length of time and extent to which the investments fair value has been less than their cost basis, the financial condition and near-term prospects of the issuer, extent of the loss related to credit of the issuer, the expected cash flows from the security, our intent to sell the security and whether or not we will be required to sell the security before we are able to recover our carrying value. Fair Value Measurements We define fair value as the amounts that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). When determining the fair value measurements for assets and liabilities which are required to be recorded at fair value, we consider the principal or most advantageous market in which we would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as risks inherent in valuation techniques, transfer restrictions and credit risks. Accounts Receivable We record trade accounts receivable net of allowances for chargebacks and cash discounts for prompt payment, as described further below. Estimates of our allowance for doubtful accounts are determined based on existing contractual payment terms, historical payment patterns of our customers and individual customer circumstances, an analysis of days sales outstanding by geographic region and a review of the local economic environment and its potential impact on government funding and reimbursement practices. Historically, the amounts of uncollectible accounts receivable that have been written off have been insignificant. Inventory We value inventory at the lower of cost or net realizable value. We determine the cost of inventory using the standard-cost method, which approximates actual cost based on a first-in, first-out method. We analyze our inventory levels quarterly and write down inventory subject to expiry in excess of expected requirements, or that has a cost basis in excess of its expected net realizable value. These write downs are charged to either cost of goods sold or the cost of supplied product included in collaboration revenues in the accompanying Consolidated Statements of Income. On a quarterly basis, we analyze our estimated production levels for the following twelve-month period, which is our normal operating cycle, and reclassify inventory we expect to use or sell in periods beyond the next twelve months into other long-term assets in the accompanying Consolidated Balance Sheets. Property and Equipment We record property and equipment at cost, net of depreciation. We compute depreciation using the straight-line method based on estimated useful lives of the assets, which ranges up to 15 years and depreciate leasehold improvements over the lesser of their estimated useful lives or the remainder of the lease term. We charge repairs and maintenance costs to expense as incurred. We periodically review property and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. We did not recognize impairment charges in any of the periods presented . Goodwill We recorded goodwill amounts as the excess purchase price over tangible assets, liabilities and intangible assets acquired based on their estimated fair value. We periodically review the carrying amount of goodwill for impairment (at least annually) and whenever events or changes in circumstance indicate that the carrying value may not be recoverable. Historically, we assessed the recoverability of our goodwill on the last day of our third quarter. Beginning in 2019, we changed the date of our annual goodwill impairment assessment to the first day of our fourth quarter to allow for operational expediency. The change in goodwill impairment testing date does not represent a significant change to our accounting for goodwill . The assessment of recoverability may first consider qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. We perform a quantitative assessment if the qualitative assessment results in a more-likely-than-not determination or if a qualitative assessment is not performed. The quantitative assessment considers whether the carrying amount of a reporting unit exceeds its fair value, in which case an impairment charge is recorded to the extent the carrying amount of the reporting unit’s goodwill exceeds its fair value. We continue to operate in one segment, which is also considered to be our sole reporting unit and therefore, goodwill is tested for impairment at the enterprise level. We did no t recognize any impairment charges in any of the periods presented. Collaboration Agreements We assess whether our collaboration agreements are subject to ASC 808: Collaborative Arrangements (Topic 808) based on whether they involve joint operating activities and whether both parties have active participation in the arrangement and are exposed to significant risks and rewards. To the extent that the arrangement falls within the scope of Topic 808, we assess whether the payments between us and our collaboration partner are subject to other accounting literature. If we conclude that payments from the collaboration partner to us represent consideration from a customer, then we account for those payments within the scope of Topic 606. However, if we conclude that our collaboration partner is not a customer for certain activities, such as for certain collaborative research and development activities, we present such payments as a reduction of research and development expense. Revenue In the first quarter of 2018, we adopted Topic 606 using the modified retrospective method applied to those contracts that were not completed as of the adoption date. Results for the years ended December 31, 2019 and 2018 are presented under Topic 606, while results for the year ended December 31, 2017 have not been adjusted and continue to be reported in accordance with our historic accounting under previous revenue recognition guidance, ASC Topic 605: Revenue Recognition (Topic 605). Under Topic 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration to which the entity is entitled to in exchange for those goods or services. To determine revenue recognition for arrangements that are within the scope of Topic 606, we perform the following five steps: 1) identify the contract(s) with a customer; 2) identify the performance obligations in the contract; 3) determine the transaction price; 4) allocate the transaction price to the performance obligations in the contract; and 5) recognize revenue when (or as) we satisfy a performance obligation. We only apply the five-step model to contracts when it is probable that we will collect the consideration we are entitled to in exchange for the goods or services we transfer to the customer. Net Product Revenues We sell our products principally to specialty distributors and specialty pharmacy providers, or collectively, our Customers. These Customers subsequently resell our products to health care providers and patients. In addition to distribution agreements with Customers, we enter into arrangements with health care providers and payors that provide for government-mandated and/or privately-negotiated rebates, chargebacks and discounts with respect to the purchase of our products. Revenues from product sales are recognized when the Customer obtains control of our product, which occurs at a point in time, typically upon delivery to the Customer. Product Sales Discounts and Allowances We record revenues from product sales at the net sales price (transaction price), which includes estimates of variable consideration for which reserves are established and that result from discounts, chargebacks, rebates, co-pay assistance, returns and other allowances that are offered within contracts between us and our Customers, health care providers, payors and other indirect customers relating to the sales of our products. These reserves are based on the amounts earned or to be claimed on the related sales and are classified as reductions of accounts receivable (if the amount is payable to the Customer) or a current liability (if the amount is payable to a party other than a Customer). Where appropriate, these estimates take into consideration a range of possible outcomes that are probability-weighted for relevant factors such as our historical experience, current contractual and statutory requirements, specific known market events and trends, industry data and forecasted Customer buying and payment patterns. Overall, these reserves reflect our best estimates of the amount of consideration to which we are entitled based on the terms of our contracts. The amount of variable consideration that is included in the transaction price may be constrained, and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from our estimates. If actual results in the future vary from our estimates, we will adjust these estimates, which would affect net product revenues and earnings in the period such variances become known. Chargebacks: Chargebacks are discounts that occur when contracted Customers purchase directly from a specialty distributor. Contracted Customers, which currently consist primarily of Public Health Service institutions, Federal government entities purchasing via the Federal Supply Schedule, Group Purchasing Organizations, and health maintenance organizations, generally purchase the product at a discounted price. The specialty distributor, in turn, charges back to us the difference between the price initially paid by the specialty distributor and the discounted price paid to the specialty distributor by the Customer. The allowance for chargebacks is based on actual chargebacks received and an estimate of sales to contracted Customers. Discounts for Prompt Payment: Our Customers in the U.S. receive a discount of 2% for prompt payment. We expect our Customers will earn 100% of their prompt payment discounts and, therefore, we deduct the full amount of these discounts from total product sales when revenues are recognized. Rebates: Allowances for rebates include mandated discounts under the Medicaid Drug Rebate Program, other government programs and commercial contracts. Rebate amounts owed after the final dispensing of the product to a benefit plan participant are based upon contractual agreements or legal requirements with public sector benefit providers, such as Medicaid. The allowance for rebates is based on statutory or contractual discount rates and expected utilization. Our estimates for the expected utilization of rebates are based on Customer and payer data received from the specialty pharmacies and distributors and historical utilization rates. Rebates are generally invoiced by the payer and paid in arrears, such that the accrual balance consists of an estimate of the amount expected to be incurred for the current quarter’s shipments to our Customers, plus an accrual balance for known prior quarters’ unpaid rebates. If actual future rebates vary from estimates, we may need to adjust our accruals, which would affect net product revenues in the period of adjustment. Allowances for rebates also include amounts related to the Medicare Part D Coverage Gap Discount Program. In the U.S. during 2018 and 2017, the Medicare Part D prescription drug benefit mandated participating manufacturers to fund 50% of the Medicare Part D insurance coverage gap for prescription drugs sold to eligible patients. This amount increased to 70% in 2019. Our estimates for expected Medicare Part D coverage gap amounts are based on Customer and payer data received from specialty pharmacies and distributors and historical utilization rates. Funding of the coverage gap is invoiced and paid in arrears so that the accrual balance consists of an estimate of the amount expected to be incurred for the current quarter’s shipments to Customer, plus an accrual balance for known prior quarters’ unpaid claims. If actual future funding varies from estimates, we may need to adjust our accruals, which would affect net product revenues in the period of adjustment. Co-payment Assistance: Patients who have commercial insurance and meet certain eligibility requirements may receive co-payment assistance. We accrue a liability for co-payment assistance based on actual program participation and estimates of program redemption using Customer data provided by the specialty distributor that administers the copay program. Other Customer Credits: We pay fees to our Customers for account management, data management and other administrative services. To the extent the services received are distinct from the sale of products to the Customer, we classify these payments in selling, general and administrative expenses in our Consolidated Statements of Income. Collaboration Revenues We enter into collaboration arrangements, under which we license certain rights to our intellectual property to third parties. The terms of these arrangements typically include payment to us for one or more of the following: non-refundable, up-front license fees; development, regulatory and sales-based milestone payments; product supply services; development cost reimbursements; profit sharing arrangements; and royalties on net sales of licensed products. Except for profit sharing arrangements, payments for product supply services and certain development cost reimbursements, each of these payment types were within the scope of Topic 606 during the years ended December 31, 2019 and 2018. As part of the accounting for these arrangements, we develop assumptions that require judgment to determine the standalone selling price for each performance obligation identified in the contract. These key assumptions may include forecasted revenues, clinical development timelines and costs, reimbursement rates for personnel costs, discount rates and probabilities of technical and regulatory success. Up-front License Fees: If the license to our intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, we recognize revenues from nonrefundable, up-front fees allocated to the license when the license is transferred to the licensee and the licensee is able to use and benefit from the license. For licenses that are bundled with other promises, we utilize judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue from non-refundable, up-front fees. We evaluate the measure of progress each reporting period and, if necessary, adjust the measure of performance and related revenue recognition. Regulatory and Development Milestone Payments: At the inception of each arrangement that includes development milestone payments, we evaluate whether the milestones are considered probable of being reached and estimate the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within our or the licensee’s control, such as regulatory approvals, are not considered probable of being achieved until uncertainty associated with the approvals has been resolved. The transaction price is then allocated to each performance obligation, on a relative standalone selling price basis, for which we recognize revenue as or when the performance obligations under the contract are satisfied. At the end of each subsequent reporting period, we re-evaluate the probability of achieving such development and regulatory milestones and any related constraint, and if necessary, adjust our estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis. Product Supply Services: Arrangements that include a promise for future supply of drug product for either clinical development or commercial supply at the licensee’s discretion are generally considered as options. We assess if these options provide a material right to the licensee and if so, they are accounted for as separate performance obligations. Development Cost Reimbursements: Our collaboration arrangements may include promises of future clinical development and drug safety services, as well as participation on certain joint committees. When such services are provided to a customer, and they are distinct from the licenses provided to our collaboration partners, these promises are accounted for as a separate performance obligation which we estimate using internal development costs incurred and projections through the term of the arrangements. We record revenue for these services as the performance obligations are satisfied over time. Profit Sharing Arrangements: Under the terms of our collaboration agreement with Genentech for cobimetinib, we are entitled to a share of U.S. profits and losses received in connection with commercialization of cobimetinib. We account for such arrangements in accordance with Topic 808. We have determined that we are an agent under the agreement and therefore revenues are recorded net of costs incurred. We record U.S. profits and losses under the collaboration agreement in the period earned based on our estimate of those amounts. We recognized an annual profit under the agreement for the years ending December 31, 2019 and 2018 and accordingly, those profits are recognized as collaboration revenues in the accompanying Consolidated Statements of Income. Prior to 2018, the commercialization of cobimetinib in the U.S. had not been profitable for any annual period and accordingly, losses for periods prior to 2018 were recognized as selling, general and administrative expenses in the accompanying Consolidated Statements of Income. Royalty and Sales-based Milestone Payments: For arrangements that include royalties and sales-based milestone payments, including milestone payments earned for the first commercial sale of a product, the license is deemed to be the predominant item to which such payments relate and we recognize revenue at the later of when the related sales occur or when the performance obligation to which the royalty has been allocated has been satisfied. Cost of Goods Sold Cost of goods sold is related to our product revenues and consists primarily of a 3% royalty we are required to pay GlaxoSmithKline (GSK) on all net sales of any product incorporating cabozantinib, the cost of manufacturing, indirect labor costs, write-downs related to expiring and excess inventory, shipping and other third-party logistics and distribution costs for our product. We consider regulatory approval of product candidates to be uncertain and product manufactured prior to regulatory approval may not be sold unless regulatory approval is obtained. As such, the manufacturing costs for product candidates incurred prior to regulatory approval were not capitalized as inventory but are expensed as research and development costs. Portions of the manufacturing costs for inventory sold during the years ended December 31, 2018 and 2017 were incurred prior to the regulatory approval of CABOMETYX and COMETRIQ and, therefore, were expensed as research and development costs when incurred, rather than capitalized as inventory. There were no amounts remaining related to previously expensed materials in our inventory balances as of December 31, 2019 or 2018. Research and Development Expenses Research and development costs are expensed as incurred and primarily include: (1) direct and indirect internal costs for drug discovery; (2) upfront license and project initiation fees, license option fees, funded research and milestone payments incurred for our in-licensing arrangements with our collaboration partners; and (3) development costs associated with our clinical trial projects, which include fees paid to Contract Research Organizations (CRO) performing work on our behalf. Our clinical trial projects have been executed with support from third-party CROs, who specialize in conducting and managing global clinical trials. We accrue expenses for clinical trial activities performed by the CROs based upon the estimated amount of work completed on each trial. For clinical trial expenses, the significant factors used in estimating accruals include direct CRO costs, the number of patients enrolled, the number of active clinical sites involved, the duration for which the patients will be enrolled in the trial and patient out of pocket costs. We monitor patient enrollment levels and related activities to the extent possible through CRO meetings and correspondence, internal reviews and review of contractual terms. We base our estimates on the best information available at the time. However, additional information may become available to us which may allow us to make a more accurate estimate in future periods. In this event, we may be required to record adjustments to research and development expenses in future periods when the actual level of activity becomes more certain. As described further above, certain payments made to us from our collaboration partners may be presented as a reduction of research and development expense. Development, regulatory or commercial milestone payments to collaboration partners are recorded as research and development costs when we determine such payments become probable. Leases We determine if an arrangement includes a lease at the inception of the agreement. For each of our lease arrangements, we record a right-of-use asset representing our right to use an underlying asset for the lease term and a lease liability representing our obligation to make lease payments. Operating lease right-of-use assets and liabilities are recognized at the lease commencement date based on the net present value of lease payments over the lease term. In determining the weighted average discount rate used to calculate the net present value of lease payments, we use our incremental borrowing rate based on the information available at the lease commencement date. Our leases may include options to extend or terminate the lease which are included in the lease term when it is reasonably certain that we will exercise any such options. Lease expense for our operating leases is recognized on a straight-line basis over the lease term. We have elected not to apply the recognition requirements of Topic 842 for short-term leases. Advertising Advertising expenses were $17.9 million , $14.8 million and $8.6 million for the years ended December 31, 2019 , 2018 and 2017 , respectively. We expense the costs of advertising, including promotional expenses, as incurred. Advertising expenses are recorded in sales, general and administrative expenses. Stock-Based Compensation We account for stock-based payments to employees, including grants of service-based restricted stock awards, performance-based restricted stock awards (PSUs), service-based stock options, performance-based stock options (PSOs), and purchases under our 2000 Employee Stock Purchase Plan (ESPP) in accordance with ASC 718, Compensation-Stock Compensation , which requires that stock-based payments (to the extent they are compensatory) be recognized in our Consolidated Statements of Income based on their fair values. We account for forfeitures of stock-based awards as they occur. The expense for stock-based compensation is based on the grant date fair value of the award. The grant date fair value of restricted stock units (RSUs) and PSUs are estimated as the value of the underlying shares of our common stock. The grant date fair values are estimated using a Monte Carlo simul |
Revenues
Revenues | 12 Months Ended |
Jan. 03, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | REVENUES Revenues consisted of the following (in thousands): Year Ended December 31, 2019 2018 2017 Product revenues: Gross product revenues $ 957,621 $ 738,529 $ 402,569 Discounts and allowances (197,671 ) (119,250 ) (53,561 ) Net product revenues 759,950 619,279 349,008 Collaboration revenues: License revenues 161,299 192,188 96,637 Research and development service revenues 49,965 39,501 8,737 Other collaboration revenues (3,439 ) 2,858 (1,905 ) Total collaboration revenues 207,825 234,547 103,469 Total revenues $ 967,775 $ 853,826 $ 452,477 Net product revenues, license revenues and research and development services revenues were recorded in accordance with Topic 606 during the years ended December 31, 2019 and 2018 and Topic 605 during the year ended December 31, 2017. During the periods presented in accordance with Topic 606, net product revenues and license revenues related to goods and intellectual property licenses transferred at a point in time and research and development services revenues related to services performed over time. License revenues includes the recognition of the portion of upfront payment milestones allocated to the transfer of intellectual property licenses for which it had become probable in the current period that the milestone would be achieved and a significant reversal of revenues would not occur, as well as royalty revenues. Research and development services revenues includes the recognition of deferred revenue for the portion of upfront and milestone payments that have been allocated to research and development services performance obligations, as well as development cost reimbursements earned under our collaboration agreements. Other collaboration revenues were recorded in accordance with Topic 808 for all periods presented and includes product supply revenues, net of product supply costs and the royalties we paid to GSK on sales by Ipsen Pharma SAS (Ipsen) of products containing cabozantinib. Profits on the U.S. commercialization of COTELLIC for the years ended December 31, 2019 and 2018 were also included other collaboration revenues, and losses on the U.S. commercialization of COTELLIC for the year ended December 31, 2017 were included in selling, general and administrative expenses Net product revenues disaggregated by product were as follows (in thousands): Year Ended December 31, 2019 2018 2017 CABOMETYX $ 733,421 $ 599,946 $ 324,000 COMETRIQ 26,529 19,333 25,008 Net product revenues $ 759,950 $ 619,279 $ 349,008 The percentage of total revenues by customer who individually accounted for 10% or more of our total revenues were as follows: Year Ended December 31, 2019 2018 2017 Ipsen 16 % 21 % 15 % Affiliates of CVS Health Corporation 15 % 13 % 16 % Affiliates of McKesson Corporation 12 % 12 % 11 % Affiliates of AmerisourceBergen Corporation 10 % 8 % 8 % Accredo Health, Incorporated 9 % 9 % 11 % Diplomat Specialty Pharmacy 5 % 9 % 18 % Revenues by geographic region were as follows (in thousands): Year Ended December 31, 2019 2018 2017 U.S. $ 770,244 $ 632,927 $ 367,906 Europe 152,771 182,879 69,792 Japan 44,760 38,020 14,779 Total revenues $ 967,775 $ 853,826 $ 452,477 Net product revenues are attributed to geographic regions based on the ship-to location. Collaboration revenues are attributed to geographic regions based on the location of our collaboration partners’ headquarters. Product Sales Discounts and Allowances The activities and ending reserve balances for each significant category of discounts and allowances (which constitute variable consideration) were as follows (in thousands): Chargebacks and Discounts for Prompt Payment Other Customer Credits/Fees and Co-pay Assistance Rebates Total Balance at December 31, 2017 $ 1,928 $ 1,795 $ 5,770 $ 9,493 Provision related to sales made in: Current period 75,543 13,017 31,040 119,600 Prior periods (403 ) 206 (153 ) (350 ) Payments and customer credits issued (74,746 ) (11,980 ) (24,741 ) (111,467 ) Balance at December 31, 2018 2,322 3,038 11,916 17,276 Provision related to sales made in: Current period 129,936 15,605 48,250 193,791 Prior periods 3,989 (111 ) 2 3,880 Payments and customer credits issued (128,733 ) (15,035 ) (44,946 ) (188,714 ) Balance at December 31, 2019 $ 7,514 $ 3,497 $ 15,222 $ 26,233 The reserves for chargebacks and discounts for prompt payment are recorded as a reduction of trade receivables, net and the remaining reserves are recorded as rebates and fees due to customers in the accompanying Consolidated Balance Sheets. Contract Assets and Liabilities We receive payments from our collaboration partners based on billing schedules established in each contract. Amounts are recorded as accounts receivable when our right to consideration is unconditional. We may also recognize revenue in advance of the contractual billing schedule and such amounts are recorded as a contract asset when recognized. Contract assets were $1.1 million and $0 as of December 31, 2019 and 2018 , respectively, and are presented in p repaid expenses and other current assets in the accompanying Consolidated Balance Statements. We may be required to defer recognition of revenue for upfront and milestone payments until we perform our obligations under these arrangements, and such amounts are recorded as deferred revenue upon receipt or when due. Contract liabilities were $6.6 million and $15.9 million as of December 31, 2019 and 2018 , respectively, and are presented in l ong-term portion of deferred revenue in the accompanying Consolidated Balance Sheets. For those contracts that have multiple performance obligations, c ontract assets and liabilities are reported on a net basis at the contract level. Significant changes in contract assets during the year ended December 31, 2019 , as compared to 2018 , were a result of the determination that it is probable that we will earn a $10.0 million milestone from Takeda Pharmaceutical Company Limited (Takeda) for the submission of a regulatory application in 2020 for cabozantinib as a treatment for patients with second-line HCC in Japan . This contract asset was recorded in p repaid expenses and other current assets in the accompanying Consolidated Balance Sheets , offset by the effect of reporting the Takeda contract asset and liability on a net basis. During the years ended December 31, 2019 and 2018 , we recognized $6.5 million and $8.7 million , respectively, in revenues that were included in the beginning deferred revenue balance for those years. During the years ended December 31, 2019 and 2018 , we recognized $161.2 million and $198.1 million , respectively, in revenues for performance obligations satisfied in previous periods. Such revenues primarily related to milestone and royalty payments allocated to our license performance obligations of our collaborations with Ipsen, Takeda and Daiichi Sankyo . As of December 31, 2019 , $63.1 million of the transaction price allocated to our performance obligations had not been satisfied. See “Note 3. Collaboration Agreements - Cabozantinib Commercial Collaborations - Performance Obligations and Transaction Prices for our Ipsen and Takeda Collaborations” f or additional information about our performance obligations. |
Collaboration Agreements
Collaboration Agreements | 12 Months Ended |
Jan. 03, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Collaboration Agreements | COLLABORATION AGREEMENTS We have established multiple collaborations with leading pharmaceutical companies for the commercialization and further development of cabozantinib, as well as with smaller, discovery-focused biotechnology companies to expand our product pipeline. Additionally, in line with our business strategy prior to the commercialization of our first product, COMETRIQ, we entered into other collaborations with leading pharmaceutical companies including Genentech and Daiichi Sankyo for other compounds and programs in our portfolio. Under these collaborations, we are generally entitled to receive milestone and royalty payments, and for certain collaborations, payments for product supply services, development cost reimbursements, and/or profit sharing payments. See “Note 2. Revenues” for information on the amount of collaboration revenues recognized during the years ended December 31, 2019 , 2018 and 2017 . Cabozantinib Commercial Collaborations Ipsen Collaboration Description of the Collaboration In February 2016, we entered into a collaboration and license agreement with Ipsen for the commercialization and further development of cabozantinib. Pursuant to the terms of the collaboration agreement, Ipsen received exclusive commercialization rights for current and potential future cabozantinib indications outside of the U.S., Canada and Japan. The collaboration agreement was subsequently amended on three occasions, including in December 2016 to include commercialization rights in Canada. We have also agreed to collaborate with Ipsen on the development of cabozantinib for current and potential future indications. The parties’ efforts are governed through a joint steering committee and appropriate subcommittees established to guide and oversee the collaboration’s operation and strategic direction; provided, however, that we retain final decision-making authority with respect to cabozantinib’s ongoing development. Unless terminated earlier, the collaboration agreement has a term that continues, on a product-by-product and country-by-country basis, until the latter of 1) the expiration of patent claims related to cabozantinib, 2) the expiration of regulatory exclusivity covering cabozantinib or 3) ten years after the first commercial sale of cabozantinib, other than COMETRIQ. A related supply agreement will continue in effect until expiration or termination of the collaboration agreement. The collaboration agreement may be terminated for cause by either party based on uncured material breach of either the collaboration agreement or the supply agreement by the other party, bankruptcy of the other party or for safety reasons. We may terminate the collaboration agreement if Ipsen challenges or opposes any patent covered by the collaboration agreement. Ipsen may terminate the collaboration agreement if the U.S. Food and Drug Administration (FDA) or European Medicines Agency orders or requires substantially all cabozantinib clinical trials to be terminated. Ipsen also has the right to terminate the collaboration agreement on a region-by-region basis after the first commercial sale of cabozantinib in advanced RCC in the given region. Upon termination by either party, all licenses granted by us to Ipsen will automatically terminate, and, except in the event of a termination by Ipsen for our material breach, the licenses granted by Ipsen to us shall survive such termination and shall automatically become worldwide, or, if Ipsen were to terminate only for a particular region, then for the terminated region. Following termination by us for Ipsen’s material breach, or termination by Ipsen without cause or because we undergo a change of control by a party engaged in a competing program, Ipsen is prohibited from competing with us for a period of time. Consideration under the Collaboration In consideration for the exclusive license and other rights contained in the collaboration agreement, including commercialization rights in Canada, we received aggregate upfront payments of $210.0 million from Ipsen in 2016. As of December 31, 2019 , we have achieved aggregate milestones of $330.0 million related to regulatory, development and sales-based progress by Ipsen since the inception of the collaboration agreement, including $55.0 million and $140.0 million in milestones achieved during the years ended December 31, 2019 and 2018 , respectively. As of December 31, 2019 , we are eligible to receive additional regulatory and development milestone payments from Ipsen totaling an aggregate of $79.0 million , as well as sales-based milestones, including milestone payments earned for the first commercial sale of a product, of up to $470.4 million . We also receive royalties on the net sales of cabozantinib by Ipsen outside of the U.S. and Japan. During the year ended December 31, 2019 and going forward, we are entitled to receive a tiered royalty of 22% to 26% on annual net sales, with separate tiers for Canada; these royalty tiers reset each calendar year. In Canada, we are entitled to receive a tiered royalty of 22% on the first CAD $30.0 million of annual net sales and a tiered royalty thereafter to 26% on annual net sales; these royalty tiers for Canada also reset each calendar year. We are required to pay a 3% royalty to GSK on all net sales of any product incorporating cabozantinib, including net sales by Ipsen. We are responsible for funding cabozantinib-related development costs for those trials in existence at the time we entered into the collaboration agreement with Ipsen; global development costs for additional trials are shared between the parties, with Ipsen reimbursing us for 35% of such costs, provided Ipsen chooses to opt into such trials. Ipsen has opted into and is co-funding: CheckMate 9ER; CheckMate 040 (though Ipsen has opted not to co-fund the triplet arm of the study evaluating cabozantinib with nivolumab and ipilimumab); the dose escalation phase and first 20 expansion cohorts of COSMIC-021; and COSMIC-312. We remain responsible for manufacturing and supply of cabozantinib for all development and commercialization activities under the collaboration agreement. In connection with the collaboration agreement, we entered into a supply agreement with Ipsen to supply finished, labeled drug product to Ipsen for distribution in the territories outside of the U.S. and Japan for the term of the collaboration agreement. The product is supplied at our cost, as defined in the agreement. Revenues from the Collaboration Collaboration revenues under the collaboration agreement with Ipsen were $152.8 million , $182.9 million and $69.8 million during the years ended December 31, 2019 , 2018 and 2017 , respectively. As of December 31, 2019 , $45.0 million of the transaction price allocated to our research and development services performance obligation had not been satisfied. See “— Performance Obligations and Transaction Prices for our Ipsen and Takeda Collaborations ”, below, for additional information related to the revenue recognition for this collaboration. Takeda Collaboration Description of the Collaboration In January 2017, we entered into a collaboration and license agreement with Takeda, which was subsequently amended effective March 2018 and May 2019, to, among other things, modify the amount of reimbursements we receive for costs associated with our required pharmacovigilance activities and milestones we are eligible to receive. Pursuant to this collaboration agreement, Takeda has exclusive commercialization rights for current and potential future cabozantinib indications in Japan, and the parties have agreed to collaborate on the clinical development of cabozantinib in Japan. The operation and strategic direction of the parties’ collaboration is governed through a joint executive committee and appropriate subcommittees. Unless earlier terminated, the collaboration agreement has a term that continues, on a product-by-product basis, until the earlier of 1) two years after first generic entry with respect to such product in Japan or 2) the later of (A) the expiration of patent claims related to cabozantinib and (B) the expiration of regulatory exclusivity covering cabozantinib in Japan. The collaboration agreement may be terminated for cause by either party based on uncured material breach by the other party, bankruptcy of the other party or for safety reasons. For clarity, Takeda’s failure to achieve specified levels of commercial performance, based upon sales volume and/or promotional effort, during the first six years of the collaboration will constitute a material breach of the collaboration agreement. We may terminate the agreement if Takeda challenges or opposes any patent covered by the collaboration agreement. At any time prior to August 1, 2023, the parties may mutually agree to terminate the collaboration agreement if Japan’s Pharmaceuticals and Medical Devices Agency is unlikely to grant any approval of the marketing authorization application in any cancer indication in Japan. After the commercial launch of cabozantinib in Japan, Takeda may terminate the collaboration agreement upon twelve months’ prior written notice following the third anniversary of the first commercial sale of cabozantinib in Japan. Upon termination by either party, all licenses granted by us to Takeda will automatically terminate, and the licenses granted by Takeda to us shall survive such termination and shall automatically become worldwide. Consideration under the Collaboration In consideration for the exclusive license and other rights contained in the collaboration agreement, we received an upfront payment of $50.0 million from Takeda in 2017. As of December 31, 2019 , we have also achieved regulatory and development milestones in the aggregate of $26.0 million since the inception of the collaboration agreement, including $16.0 million and $10.0 million in milestones achieved during the years ended December 31, 2019 and 2018 , respectively. As of December 31, 2019 , we had also determined that it was probable that we will earn a $10.0 million milestone in the first quarter of 2020 for the anticipated January 2020 submission of a regulatory application to the Japanese MHLW for Manufacturing and Marketing Approval of cabozantinib as a treatment for patients in Japan with unresectable HCC who progressed after prior systemic therapy. Under the collaboration agreement, as amended, as of December 31, 2019 , we are eligible to receive regulatory and development milestone payments from Takeda of up to $20.0 million related to first-line RCC and second-line HCC, including the $10.0 million milestone we expect to earn for the submission of a regulatory application in the first quarter of 2020 described above . We are also eligible to receive additional regulatory and development milestone payments, without limit, for additional potential future indications. We are further eligible to receive sales-based milestones, including milestone payments earned for the first commercial sale of a product, of up to $155.0 million . We also receive royalties on the net sales of cabozantinib in Japan. We are entitled to receive a tiered royalty of 15% to 24% on the initial $300.0 million of net sales, and following this initial $300.0 million of net sales, we are then entitled to receive a tiered royalty of 20% to 30% on annual net sales thereafter; these 20% to 30% royalty tiers reset each calendar year. We are required to pay a 3% royalty to GSK on all net sales of any product incorporating cabozantinib, including net sales by Takeda. Takeda is responsible for 20% of the costs associated with the cabozantinib development plan’s current and future trials, provided Takeda opts into such trials, and 100% of costs associated with the cabozantinib development activities that are exclusively for the benefit of Japan. Takeda has opted into and is co-funding CheckMate 9ER. Pursuant to the terms of the collaboration agreement, we are responsible for the manufacturing and supply of cabozantinib for all development and commercialization activities under the collaboration agreement. In connection with the collaboration agreement, we entered into a clinical supply agreement covering the supply of cabozantinib to Takeda for the term of the collaboration agreement, as well as a quality agreement that provides respective quality responsibilities for the aforementioned supply. Furthermore, at the time we entered into the collaboration agreement, the parties also entered into a safety data exchange agreement, which defines each partner’s responsibility for safety reporting. This agreement also requires us to maintain the global safety database for cabozantinib. To meet our obligations to regulatory authorities for the reporting of safety data from Japan from sources other than our sponsored global clinical development trials, we rely on data collected and reported to us by Takeda. Revenues from the Collaboration Collaboration revenues under the collaboration agreement with Takeda were $24.6 million , $18.0 million and $14.8 million during the years ended December 31, 2019 , 2018 and 2017 , respectively. As of December 31, 2019 , $18.1 million of the transaction price allocated to our research and development services performance obligation had not been satisfied. Performance Obligations and Transaction Prices for our Ipsen and Takeda Collaborations We identified two performance obligations for both the Ipsen and Takeda collaboration agreements: (1) the transfer of an exclusive license for the commercialization and further development of cabozantinib; and (2) research and development services, which includes certain committed studies for the development of cabozantinib, pharmacovigilance services and participation on various joint committees (as defined in the specific collaboration agreements). We have allocated the transaction price for each of these collaborations to the identified performance obligations based on our best estimate of their relative standalone selling price. For the licenses, the estimate of the relative standalone selling price was determined using a discounted cash flow valuation utilizing forecasted revenues and costs. For research and development services the estimate of the relative standalone selling price was determined using an adjusted market assessment approach that relies on internal and external costs and market factors. The portion of the transaction price allocated to our license performance obligation is recorded immediately as our license represents functional intellectual property that was transferred at a point in time. The portion of the transaction price allocated to our research and development services performance obligation is being recognized as revenue using the inputs method based on our internal development projected cost estimates through the current estimated patent expiration of cabozantinib in the European Union for the Ipsen Collaboration and Japan for the Takeda Collaboration, both of which are early 2030. Based on our evaluation of the collaboration agreements as of the date adoption of Topic 606, we determined that for both agreements, the up-front, nonrefundable payments, the milestones and royalties achieved as of December 31, 2017, and our estimate for the reimbursements of our research and development services performance obligation over the term of each agreement constituted the amount of the consideration to be included in the transaction price as of December 31, 2017. In addition, the transaction price for the Ipsen collaboration agreement included a $10.0 million milestone we expected to achieve during the three months ended March 31, 2018. Other than the $10.0 million milestone, variable consideration for both agreements related to regulatory and development milestones not previously recognized was constrained due to the fact that it was not probable that a significant reversal of cumulative revenue would not occur, given the inherent uncertainty of success with these milestones. Any variable consideration related to royalties and sales-based milestones will be recognized when the related sales occur as these amounts have been determined to relate to the relevant transferred license and therefore are recognized as the related sales occur. We re-evaluate the transaction price for the collaboration agreements in each reporting period as uncertain events are resolved or other changes in circumstances occur and we allocate those changes in the transaction price between our performance obligations. During the years ended December 31, 2019 and 2018 , the transaction price increased as a result of the achievement of various milestones. We further updated the transaction price based upon the actual research and development services performed during the period and changes in our estimated reimbursements for our future research and development services. The portion of the increase in transaction price that was allocated to the previously satisfied performance obligations for the transfer of an intellectual property license was recognized during the period and the portion allocated to research and development services will be recognized in future periods as those services are delivered through early 2030. As of December 31, 2019 , variable consideration related to the remaining unearned regulatory and development milestones for both agreements remained constrained due to the fact that it was not probable that a significant reversal of cumulative revenue would not occur. Cabozantinib Development Collaborations Bristol-Myers Squibb Company (BMS) In February 2017, we entered into a clinical trial collaboration agreement with BMS for the purpose of exploring the therapeutic potential of cabozantinib in combination with BMS’s immune checkpoint inhibitors (ICIs), nivolumab and/or ipilimumab, to treat a variety of types of cancer. As part of the collaboration, we are evaluating these combinations as treatment options for RCC in the CheckMate 9ER and COSMIC-313 trials and for HCC in the CheckMate 040 trial. Under the terms of the collaboration agreement with BMS, we may also evaluate these combinations in other phase 3 pivotal trials in various other tumor types. Under the terms of the collaboration agreement with BMS, as subsequently amended effective March 2019, May 2019 and November 2019, each party granted to the other a non-exclusive, worldwide (within the collaboration territory as defined in the collaboration agreement and its supplemental agreements), non-transferable, royalty-free license to use the other party’s compounds in the conduct of each clinical trial. The parties’ efforts are governed through a joint development committee established to guide and oversee the collaboration’s operation. Each trial will be conducted under a combination Investigational New Drug application, unless otherwise required by a regulatory authority. Each party will be responsible for supplying finished drug product for the applicable clinical trial, and we are sponsoring the COSMIC-313 trial and BMS is sponsoring the CheckMate 9ER and CheckMate 040 trials. The responsibility for the payment of costs for any further trials will be determined on a trial-by-trial basis. Unless earlier terminated, the collaboration agreement will remain in effect until the completion of all clinical trials under the collaboration, all related trial data has been delivered to both parties and the completion of any then agreed upon analysis. The collaboration agreement may be terminated for cause by either party based on uncured material breach by the other party, bankruptcy of the other party or for safety reasons. Upon termination by either party, the licenses granted to each party to conduct a combined therapy trial will terminate. F. Hoffmann-La Roche Ltd. (Roche) Collaboration In February 2017, we entered into a master clinical supply agreement with Roche for the purpose of evaluating cabozantinib and Roche’s ICI, atezolizumab, in locally advanced or metastatic solid tumors. Pursuant to the terms of this agreement with Roche, in June 2017, we initiated COSMIC-021, a phase 1b dose escalation study that is evaluating the safety and tolerability of cabozantinib in combination with Roche’s atezolizumab in patients with locally advanced or metastatic solid tumors, and in December 2018, we initiated COSMIC-312, a multicenter, randomized, controlled phase 3 pivotal trial evaluating cabozantinib in combination with atezolizumab versus sorafenib in previously untreated advanced HCC. We are the sponsor of both trials, and Roche is providing atezolizumab free of charge. In December 2019, we entered into a joint clinical research agreement with Roche for the purpose of further evaluating the combination of cabozantinib with atezolizumab in patients with locally advanced or metastatic solid tumors, including in three planned phase 3 pivotal trials in advanced non-small cell lung cancer, metastatic castration-resistant prostate cancer and RCC. If a party to the joint clinical research agreement proposes any additional combined therapy trials beyond the initial three planned phase 3 pivotal trials, the joint clinical research agreement provides that such proposing party must notify the other party and that if agreed to, any such additional combined therapy trial will become part of the collaboration, or if not agreed to, the proposing party may conduct such additional combined therapy trial independently, subject to specified restrictions set forth in the joint clinical research agreement. Pursuant to the terms of the joint clinical research agreement, each party granted to the other a non-exclusive, worldwide (excluding, in our case, territory already the subject of a license by us to Takeda), non-transferable, royalty-free license, with a right to sublicense (subject to limitations), to use the other party’s intellectual property and compounds solely as necessary for the party to perform its obligations under the joint clinical research agreement. The parties’ efforts will be governed through a joint steering committee established to guide and oversee the collaboration and the conduct of the combined therapy trials. Each party will be responsible for providing clinical supply for all combined therapy trials, and the cost of the supply will be borne by such party. The clinical trial expenses for each combined therapy trial agreed to be conducted jointly under the joint clinical research agreement will be shared equally between the parties, and the clinical trial expenses for each additional combined therapy trial not agreed to be conducted jointly under the joint clinical research agreement will be borne by the proposing party, except that the cost of clinical supply for all combined therapy trials will be borne by the party that owns the applicable product. We determined the contract is within the scope of Topic 808 as it involves joint operating activities where both parties have active participation in the arrangement and are exposed to significant risks and rewards. Payments between us and Roche under this arrangement are not subject to other accounting literature. Payments due to Roche for our share of clinical trial costs incurred by Roche will be recorded as research and development expense and payments due from Roche for their share of clinical trial costs incurred by us will be recorded as a reduction of research and development expense. Unless earlier terminated, the joint clinical research agreement provides that it will remain in effect until the completion of all combined therapy trials under the collaboration, the delivery of all related trial data to both parties, and the completion of any then agreed-upon additional analyses. The joint clinical research agreement may be terminated for cause by either party based on any uncured material breach by the other party, bankruptcy of the other party or for safety reasons. Upon termination by either party, the licenses granted to each party will terminate upon completion of any ongoing activities under the joint clinical research agreement. GSK In October 2002, we established a product development and commercialization collaboration agreement with GSK. Under the terms of the collaboration agreement, GSK had the right to choose cabozantinib for further development and commercialization, but notified us in October 2008 that it had waived its right to select the compound for such activities. Although the collaboration agreement was terminated during 2014, we continue to be required to pay a 3% royalty to GSK on the net sales of any product incorporating cabozantinib by us and our collaboration partners. Royalties earned by GSK in connection with the sales of cabozantinib are included in cost of goods sold for sales by us and as a reduction of other collaboration revenues for sales by our collaboration partners. Such royalties were $31.3 million , $24.0 million and $12.4 million during the years ended December 31, 2019 , 2018 and 2017 , respectively. In-Licensing Collaborations Aurigene Discovery Technologies Limited (Aurigene) Collaboration In July 2019, we entered into an exclusive collaboration, option and license agreement with Aurigene to in-license as many as six programs to discover and develop small molecules as therapies for cancer. Under the terms of the agreement, we made aggregate upfront payments of $17.5 million for exclusive options to license up to six programs, including three pre-existing programs. We are also responsible for up to $32.6 million in research funding for the discovery and preclinical development work on these programs. During the year ended December 31, 2019 , we incurred $4.0 million in expense for the discovery and preclinical development funding commitment. For each option we decide to exercise, we will be required to pay an exercise fee of either $10.0 million or $12.0 million , depending on the program, and would then assume responsibilities for all subsequent clinical development, manufacturing and commercialization for that program. Aurigene would then become eligible for up to $148.8 million per program in potential development and regulatory milestone payments, $280.0 million per program in potential commercial milestone payments, as well as royalties on potential sales. Under the terms of the agreement, Aurigene retains limited development and commercial rights for India and Russia. Iconic Therapeutics, Inc. (Iconic) Collaboration In May 2019, we entered into an exclusive option and license agreement with Iconic to advance an innovative next-generation antibody-drug conjugate (ADC) program for cancer, leveraging Iconic’s expertise in targeting tissue factor in solid tumors. Under the terms of the agreement, we gained an exclusive option to license ICON-2, Iconic’s lead oncology ADC program, in exchange for an upfront payment to Iconic of $7.5 million and a commitment for preclinical development funding. During the year ended December 31, 2019 , we incurred $9.8 million in expense for the preclinical development funding commitment. Both the upfront payment and the accrual for the preclinical development funding commitment were included in research and development expenses in the accompanying Consolidated Statements of Income. If we exercise the option, we will be required to make an option exercise fee payment of $20.0 million to Iconic; we would then assume responsibilities for all subsequent clinical development, manufacturing and commercialization activities, and Iconic would become eligible for up to $190.6 million in potential development, regulatory and first-sale milestone payments, $262.5 million in potential commercial milestone payments, as well as royalties on potential sales. Invenra, Inc. (Invenra) Collaboration In May 2018, we entered into a collaboration and license agreement with Invenra to discover and develop multispecific antibodies for the treatment of cancer. Invenra is responsible for antibody lead discovery and generation while we will lead IND-enabling studies, manufacturing, clinical development in single-agent and combination therapy regimens, and future regulatory and commercialization activities. The collaboration agreement provides that we will receive an exclusive, worldwide license to one preclinical, multispecific antibody asset, and that we will pursue up to six additional discovery projects during the term of the collaboration, which in total are directed to three discovery programs. In October 2019, we expanded our collaboration to include the development of novel binders against six additional targets, which we can use to generate multispecific antibodies based on Invenra’s B-Body TM technology platform, or with other platforms and formats at our option. As of December 31, 2019, we have initiated three additional discovery projects and two binder projects, and in total we incurred an aggregate of $7.0 million and $4.0 million in expense during the years ended December 31, 2019 and 2018, respectively, in consideration of the upfront licensing and project initiation fees. Invenra is eligible to receive up to $131.5 million in project initiation fees and milestone payments based on the achievement of specific development and regulatory milestones for a B-Body product in the first indication, or in lieu of such payments, up to $43.4 million in project initiation fees and milestone payments based on the achievement of specific development and regulatory milestones for a non- B-Body product. Upon successful commercialization of a product, Invenra is eligible to receive sales-based milestone payments up to $325.0 million as well as single-digit tiered royalties on net sales of the approved product. We have the right to initiate three additional discovery projects for development subject to an upfront payment of $2.0 million for each B-Body project and four additional binder projects subject to an upfront payment of $1.5 million for each project, as well as additional milestone payments and royalties for any products that arise from these efforts. StemSynergy Therapeutics, Inc. (StemSynergy) Collaboration In January 2018, we entered into an exclusive collaboration and license agreement with StemSynergy for the discovery and development of novel oncology compounds targeting Casein Kinase 1 alpha (CK1 α ), a component of the Wnt signaling pathway implicated in key oncogenic processes. Under the terms of the a greement, we will partner with StemSynergy to conduct preclinical and clinical studies with compounds targeting CK1 α . We paid StemSynergy an upfront payment of $3.0 million in initial research and development funding during the year ended December 31, 2018 and provided $1.9 million and $1.2 million in additional research and development funding during the years ended December 31, 2019 and 2018 , respectively. StemSynergy is eligible for up to $0.5 million in additional research and development funding on an as needed basis. StemSynergy will also be eligible for up to $56.5 million in milestones for the first product to emerge from the collaboration, including preclinical and clinical development and regulatory milestone payments, sales-based milestones, as well as single-digit royalties on worldwide sales. We will be solely responsible for the commercialization of products that arise from the collaboration. Other Collaborations Genentech Profits and losses on U.S. commercialization and royalty revenues on ex-U.S. sales under the collaboration agreement with Genentech were as follows (in thousands): Year Ended December 31, 2019 2018 2017 Profits and losses on U.S. commercialization $ 4,615 $ 8,084 $ (2,140 ) Royalty revenues on ex-U.S. sales $ 5,679 $ 5,564 $ 6,398 Profits on the U.S. commercialization of COTELLIC for the years ended December 31, 2019 and 2018 were included collaboration revenues and losses on the U.S. commercialization of COTELLIC for the year ended December 31, 2017 were included in selling, general and administrative expenses. The royalty revenues on ex-U.S. sales were included in Collaboration revenues for all periods presented. See “—Performance Obligations and Transaction Prices for our Other Collaborations”, below, for additional information related to revenue recognition for this collaboration. Cobimetinib Profit Sharing and Royalty Revenues In December 2006, we out-licensed the development and commercialization of cobimetinib to Genentech pursuant to a worldwide collaboration agreement. In November 2015, the FDA approved cobimetinib, under the brand name COTELLIC, in combination with Genentech’s Zelboraf (vemurafenib) as a treatment for |
Cash and Investments
Cash and Investments | 12 Months Ended |
Jan. 03, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Cash and Investments | CASH AND INVESTMENTS Cash, Cash Equivalents and Restricted Cash Equivalents A reconciliation of cash, cash equivalents, and restricted cash equivalents reported within our Consolidated Balance Sheets to the amount reported within the accompanying Consolidated Statements of Cash Flows was as follows (in thousands): December 31, 2019 2018 2017 Cash and cash equivalents $ 266,501 $ 314,775 $ 183,164 Short-term restricted cash equivalents — — 504 Restricted cash equivalents included in long-term investments 1,636 1,100 4,646 Cash, cash equivalents, and restricted cash equivalents as reported within the accompanying Consolidated Statements of Cash Flows $ 268,137 $ 315,875 $ 188,314 Restricted cash equivalents consisted of certificates of deposit with original maturities of 90 days or less used to collateralize letters of credit and, during prior periods, a purchasing card program. The classification of restricted cash equivalents as short-term or long-term is dependent upon the longer of the remaining term to maturity of the investment or the remaining term of the related restriction . Cash and Investments Cash and investments consisted of the following (in thousands): December 31, 2019 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Investment securities available-for-sale: Commercial paper $ 389,573 $ — $ — $ 389,573 Corporate bonds 752,295 3,934 (3 ) 756,226 U.S. Treasury and government sponsored enterprises 166,483 187 (5 ) 166,665 Total investment securities available-for-sale 1,308,351 4,121 (8 ) 1,312,464 Cash 40,964 — — 40,964 Money market funds 2,467 — — 2,467 Certificates of deposit 32,728 5 — 32,733 Total cash and investments $ 1,384,510 $ 4,126 $ (8 ) $ 1,388,628 December 31, 2018 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Investment securities available-for-sale: Commercial paper $ 381,134 $ — $ (1 ) $ 381,133 Corporate bonds 344,741 180 (857 ) 344,064 U.S. Treasury and government sponsored enterprises 55,224 2 (25 ) 55,201 Total investment securities available-for-sale 781,099 182 (883 ) 780,398 Cash 6,883 — — 6,883 Money market funds 47,744 — — 47,744 Certificates of deposit 16,596 — — 16,596 Total cash and investments $ 852,322 $ 182 $ (883 ) $ 851,621 Gains and losses on the sales of investment securities available-for-sale were insignificant during the years ended December 31, 2019 , 2018 and 2017 . We manage credit risk associated with our investment portfolio through our investment policy, which limits purchases to high-quality issuers and limits the amount of our portfolio that can be invested in a single issuer. The fair value and gross unrealized losses on investment securities available-for-sale in an unrealized loss position were as follows (in thousands): December 31, 2019 In an Unrealized Loss Position Less than 12 Months In an Unrealized Loss Position 12 Months or Greater Total Fair Value Gross Fair Value Gross Fair Value Gross Corporate bonds $ 14,529 $ (3 ) $ — $ — $ 14,529 $ (3 ) U.S. Treasury and government sponsored enterprises 2,848 (5 ) — — 2,848 (5 ) Total $ 17,377 $ (8 ) $ — $ — $ 17,377 $ (8 ) December 31, 2018 In an Unrealized Loss Position Less than 12 Months In an Unrealized Loss Position 12 Months or Greater Total Fair Value Gross Fair Value Gross Fair Value Gross Corporate bonds $ 236,162 $ (606 ) $ 39,627 $ (251 ) $ 275,789 $ (857 ) U.S. Treasury and government sponsored enterprises 28,105 (16 ) 9,182 (9 ) 37,287 (25 ) Commercial paper 7,091 (1 ) — — 7,091 (1 ) Total $ 271,358 $ (623 ) $ 48,809 $ (260 ) $ 320,167 $ (883 ) There were 9 and 199 investment securities in an unrealized loss position as of December 31, 2019 and 2018 , respectively. During the years ended December 31, 2019 , 2018 and 2017 we did no t record any other-than-temporary impairment charges on our available-for-sale securities. Based upon our quarterly impairment review, we determined that the unrealized losses were not attributed to credit risk, but were primarily associated with changes in interest rates. Based on the scheduled maturities of our investments, we determined that it was more likely than not that we will hold these investments for a period of time sufficient for a recovery of our cost basis. The fair value of investment securities available-for-sale by contractual maturity were as follows (in thousands): December 31, 2019 2018 Maturing in one year or less $ 789,913 $ 626,711 Maturing after one year through five years 522,551 153,687 Total investment securities available-for-sale $ 1,312,464 $ 780,398 |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Jan. 03, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS Fair value reflects the amounts that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy has the following three levels: • Level 1 - quoted prices (unadjusted) in active markets for identical assets and liabilities; • Level 2 - inputs other than level 1 that are observable either directly or indirectly, such as quoted prices in active markets for similar instruments or on industry models using data inputs, such as interest rates and prices that can be directly observed or corroborated in active markets; • Level 3 - unobservable inputs that are supported by little or no market activity that are significant to the fair value measurement The classifications within the fair value hierarchy of our financial assets that were measured and recorded at fair value on a recurring basis were as follows (in thousands): December 31, 2019 Level 1 Level 2 Total Commercial paper $ — $ 389,573 $ 389,573 Corporate bonds — 756,226 756,226 U.S. Treasury and government sponsored enterprises — 166,665 166,665 Total investment securities available-for-sale — 1,312,464 1,312,464 Money market funds 2,467 — 2,467 Certificates of deposit — 32,733 32,733 Total financial assets carried at fair value $ 2,467 $ 1,345,197 $ 1,347,664 December 31, 2018 Level 1 Level 2 Total Commercial paper $ — $ 381,133 $ 381,133 Corporate bonds — 344,064 344,064 U.S. Treasury and government sponsored enterprises — 55,201 55,201 Total investment securities available-for-sale — 780,398 780,398 Money market funds 47,744 — 47,744 Certificates of deposit — 16,596 16,596 Total financial assets carried at fair value $ 47,744 $ 796,994 $ 844,738 When available, we value investments based on quoted prices for those financial instruments, which is a Level 1 input. Our remaining investments are valued using third-party pricing sources, which use observable market prices, interest rates and yield curves observable at commonly quoted intervals for similar assets as observable inputs for pricing, which is a Level 2 input. |
Inventory
Inventory | 12 Months Ended |
Jan. 03, 2020 | |
Inventory Disclosure [Abstract] | |
Inventory | INVENTORY Inventory consisted of the following (in thousands): December 31, 2019 2018 Raw materials $ 2,709 $ 1,922 Work in process 9,447 6,170 Finished goods 4,367 3,836 Total $ 16,523 $ 11,928 Balance Sheet classification: Current portion included in inventory $ 12,886 $ 9,838 Long-term portion included in other long-term assets 3,637 2,090 Total $ 16,523 $ 11,928 Write-downs related to excess and expiring inventory were $1.3 million , $1.1 million and $1.2 million for the years ended December 31, 2019 , 2018 and 2017 , respectively. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Jan. 03, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | PROPERTY AND EQUIPMENT Property and equipment consisted of the following (in thousands): Estimated Useful Lives December 31, 2019 2018 Leasehold improvements up to 15 years $ 33,904 $ 33,941 Computer equipment and software 3 years 17,338 15,022 Furniture and fixtures 5 to 7 years 13,053 12,709 Laboratory equipment 5 years 8,904 5,668 Construction in progress 1,253 866 74,452 68,206 Less: accumulated depreciation (25,560 ) (17,309 ) Property and equipment, net $ 48,892 $ 50,897 Depreciation and amortization expenses were $8.3 million , $4.9 million and $1.2 million during the years ended December 31, 2019 , 2018 and 2017 , respectively. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Jan. 03, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Employee Benefit Plans | EMPLOYEE BENEFIT PLANS Equity Incentive Plans and ESPP We allocated the stock-based compensation expense for our equity incentive plans and our ESPP as follows (in thousands): Year Ended December 31, 2019 2018 2017 Research and development $ 19,374 $ 13,115 $ 7,569 Selling, general and administrative 37,228 27,511 16,369 Total stock-based compensation $ 56,602 $ 40,626 $ 23,938 We have several equity incentive plans under which we granted stock options and RSUs, including PSOs and PSUs, to employees and directors. At December 31, 2019 , 6,258,319 shares were available for grant under our equity incentive plans. The Board of Directors (the Board) delegated responsibility for administration of our equity incentive plans to the Compensation Committee of the Board, including the authority to determine the term, exercise price and vesting requirements of each grant. Stock options granted to our employees and directors generally have a four -year vesting term and a one-year vesting term, respectively, an exercise price equal to the fair market value on the date of grant, and a seven -year life from the date of grant. Stock options issued prior to May 2011 have a ten -year life from the date of grant. RSUs granted to our employees and directors generally have a four -year vesting term and a one-year vesting term, respectively. PSUs and PSOs granted pursuant to our equity incentive plans vest upon the achievement of a performance target or market condition, respectively. We have adopted a Change in Control and Severance Benefit Plan for certain executive officers. Eligible Change in Control and Severance Benefit Plan participants include employees with the title of vice president and above. If a participant’s employment is terminated without cause during a period commencing one month before and ending thirteen months following a change in control, as defined in the plan document, then the Change in Control and Severance Benefit Plan participant is entitled to have the vesting of all their outstanding equity awards accelerated and the exercise period for their stock options extended to no more than one year. We have an ESPP that allows for qualified employees (as defined in the ESPP) to purchase shares of our common stock at a price equal to the lower of 85% of the closing price at the beginning of the offering period or 85% of the closing price at the end of each six month purchase period. Compensation expense related to our ESPP was $2.2 million , $2.2 million , and $1.6 million for the years ended December 31, 2019 , 2018 and 2017 , respectively. As of December 31, 2019 , we had 4,238,999 shares available for issuance under our ESPP. Pursuant to the ESPP, we issued 483,009 , 330,492 and 434,523 shares of common stock at an average price per share of $12.60 , $15.74 and $11.20 during the years ended December 31, 2019 , 2018 and 2017 , respectively . Cash received from purchases under the ESPP for the years ended December 31, 2019 , 2018 and 2017 was $6.1 million , $5.2 million and $4.9 million , respectively. We used a Monte Carlo simulation pricing model to value PSOs that include market vesting conditions and a Black-Scholes Merton option pricing model to value other stock options and ESPP purchases. The weighted average grant-date fair value per share of stock options and ESPP purchases were as follows: Year Ended December 31, 2019 2018 2017 Stock options, including PSOs $ 8.19 $ 9.07 $ 11.42 ESPP $ 4.85 $ 6.40 $ 6.00 The grant-date fair value of stock option grants, including PSOs, and ESPP purchases was estimated using the following assumptions: Year Ended December 31, 2019 2018 2017 Stock options, including PSOs: Risk-free interest rate 1.77 % 2.81 % 1.98 % Dividend yield — % — % — % Volatility 48 % 55 % 59 % Expected life 4.3 years 4.4 years 4.5 years ESPP: Risk-free interest rate 2.16 % 1.93 % 1.09 % Dividend yield — % — % — % Volatility 50 % 53 % 58 % Expected life 6 months 6 months 6 months We considered both implied and historical volatilities in developing our estimate of expected volatility. The assumption for the expected life of stock options is based on historical exercise patterns and post-vesting termination behavior. The risk-free interest rate is based on U.S. Treasury rates with the same or similar term as the underlying award. Our dividend rate is based on historical experience and our investors’ current expectations. The fair value of RSUs, including the PSUs, was based on the closing price of the underlying common stock on the date of grant. Activity for stock options, including PSOs, during the year ended December 31, 2019 was as follows (in thousands , except per share amounts): Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term Aggregate Intrinsic Value Stock options outstanding at December 31, 2018 22,674 $ 8.71 Granted 1,311 $ 20.08 Exercised (3,274 ) $ 5.01 Forfeited (217 ) $ 16.89 Expired (51 ) $ 22.98 Stock options outstanding at December 31, 2019 20,443 $ 9.91 3.2 years $ 169,299 Stock options exercisable at December 31, 2019 16,216 $ 7.36 2.6 years $ 167,449 As of December 31, 2019 , there was $33.7 million of unrecognized compensation expense related to our unvested stock options, including PSOs. The compensation expense for the unvested stock options will be recognized over a weighted-average period of 2.2 years . During the year ended December 31, 2018, in connection with our long-term incentive compensation program, we granted 308,365 PSOs to our President and Chief Executive Officer. In addition to the standard service conditions included in our other stock options, these PSOs may not be exercised until, at any time after the grant date, the closing market price of a share of our Common Stock is equal to or greater than 125% of the per share exercise price of the PSO over a period of at least 30 consecutive calendar days. The stock-based compensation expense for the PSO is being recognized on an accelerated basis over the service period of the award, which commenced on the date of grant. The aggregate intrinsic value in the table above represents the total intrinsic value (the difference between our closing stock price on the last trading day of fiscal 2019 and the exercise prices, multiplied by the number of in-the-money stock options) that would have been received by the stock option holders had all stock option holders exercised their stock options on December 31, 2019 . The total intrinsic value of stock options exercised during the years ended December 31, 2019 , 2018 and 2017 was $54.1 million , $39.1 million and $85.2 million , respectively. Cash received from stock option exercises during the years ended December 31, 2019 , 2018 and 2017 was $16.4 million , $12.1 million and $17.6 million , respectively. The total estimated fair value of stock options vested and recorded as expense during the years ended December 31, 2019 , 2018 and 2017 was $23.4 million , $18.9 million and $13.1 million , respectively. Activity for RSUs, including PSUs, during the year ended December 31, 2019 was as follows (in thousands , except per share amounts): Shares Weighted Average Grant Date Fair Value Weighted Average Remaining Contractual Term Aggregate Intrinsic Value RSUs outstanding at December 31, 2018 4,857 $ 18.42 Awarded 5,842 $ 19.46 Vested and released (1,541 ) $ 17.23 Forfeited (357 ) $ 18.66 RSUs outstanding at December 31, 2019 8,801 $ 19.31 2.2 years $ 149,701 As of December 31, 2019 , there was $158.0 million of unrecognized compensation expense related to our unvested RSUs, including PSUs. The compensation expense for the unvested RSUs will be recognized over a weighted-average period of 2.7 years . During 2019, in connection with our long-term incentive compensation program, we awarded 1,926,605 PSUs (the target amount) that will vest upon the achievement of a performance target related to a product approval by the FDA (the 2019 PSUs); employees may earn 150% of the target amount, or an additional 963,136 shares relative to the target amount, if the performance target is achieved before December 31, 2020 and may earn 200% of the target amount, or up to an additional 1,926,605 shares relative to the target amount, if we receive a second product approval by December 31, 2021. During 2018 we awarded 693,131 PSUs that will vest upon the achievement of certain product revenue, late-stage clinical development programs and discovery pipeline expansion performance targets (the 2018 PSUs). The 2018 PSUs and 2019 PSUs were designed to drive the performance of our management team and employees toward the achievement of key corporate objectives and will be forfeited if the performance targets are not met by December 31, 2021. Expense recognition for PSUs commences when it is determined that attainment of the performance target is probable. During the year ended December 31, 2019 , we achieved two of the performance targets for 281,238 of the 2018 PSUs and determined that it was probable that we would achieve one additional performance target for 99,281 additional 2018 PSUs. As a result, 141,004 of the 2018 PSUs have vested as of December 31, 2019 and the remainder are expected to vest over various dates through November 2021. We recognized $4.9 million in compensation expense related to those 2018 PSUs during the year ended December 31, 2019 ; the remaining unrecognized compensation expense for those 2018 PSUs was $2.1 million as of December 31, 2019 . The total unrecognized compensation expense for both the 2019 PSUs and the remaining 2018 PSUs for which we have not yet determined that attainment of the performance target is probable was $80.2 million as of December 31, 2019 . Exelixis, Inc. 401(k) Plan (the 401(k) Plan) We sponsor the 401(k) Plan under which we historically made matching contributions to our employees’ 401(k) accounts in the form of our common stock. We recorded compensation expense related to the stock match of $4.6 million , $3.6 million , and $1.7 million for the years ended December 31, 2019 , 2018 and 2017 , respectively. Beginning in 2020, we will make matching contributions to our employees’ 401(k) accounts in cash . |
Income Taxes
Income Taxes | 12 Months Ended |
Jan. 03, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES Our income before income taxes is derived solely from within the U.S. Our income tax provision (benefit) was as follows (in thousands): Year Ended December 31, 2019 2018 2017 Current: Federal $ — $ — $ — State 6,095 6,133 4,350 Total current tax expense 6,095 6,133 4,350 Deferred: Federal 71,580 (238,675 ) — State (578 ) (5,436 ) — Total deferred tax expense 71,002 (244,111 ) — Income tax provision (benefit) $ 77,097 $ (237,978 ) $ 4,350 The income tax provision for the year ended December 31, 2019 primarily relates to the utilization of federal net operating loss and state taxes in jurisdictions outside of California, for which we do not have net operating loss carryforwards due to a limited operating history. The income tax benefit for the year ended December 31, 2018 primarily relates to the release of our valuation allowance against significantly all of our deferred tax assets offset by state taxes in jurisdictions outside of California. The income tax provision for the year ended December 31, 2017 primarily related to state taxes in jurisdictions outside of California. Our historical net operating losses were sufficient to fully offset any federal taxable income for the years ended December 31, 2019, 2018 and 2017. The reconciliation of the U.S. federal income tax provision (benefit) at the statutory federal income tax rates of 21% , 21% and 34% for the years ended December 31, 2019, 2018 and 2017, respectively, to our income tax provision (benefit) was as follows (in thousands): Year Ended December 31, 2019 2018 2017 U.S. federal income tax provision at statutory rate $ 83,603 $ 94,939 $ 53,916 State tax expense 1,148 4,690 8,282 Change in valuation allowance 3,208 (315,394 ) (34,266 ) Research credits (8,299 ) (18,308 ) — Stock-based compensation (9,177 ) (5,998 ) (20,548 ) Non-deductible executive compensation 4,228 1,111 1,239 Non-deductible interest — — 1,367 Other 2,386 982 (5,640 ) Income tax provision (benefit) $ 77,097 $ (237,978 ) $ 4,350 Deferred tax assets and liabilities reflect the net tax effects of net operating loss and tax credit carryforwards and temporary differences between the carrying amounts of assets and liabilities for financial reporting and the amounts used for income tax purposes. Our deferred tax assets and liabilities were as follows (in thousands): December 31, 2019 2018 Deferred tax assets: Net operating loss carryforwards $ 65,131 $ 146,701 Tax credit carryforwards 110,037 98,467 Depreciation and amortization 26,792 29,929 Stock-based compensation 14,966 11,366 Lease liabilities 11,211 3,265 Accruals and reserves not currently deductible 8,248 7,160 Deferred revenue 6,547 5,474 Other assets 345 1,140 Total deferred tax assets 243,277 303,502 Valuation allowance (61,659 ) (58,112 ) Net deferred tax assets 181,618 245,390 Deferred tax liabilities: Lease right-of-use assets (9,244 ) (1,279 ) Total deferred tax liabilities (9,244 ) (1,279 ) Net deferred taxes $ 172,374 $ 244,111 ASC Topic 740: Income Taxes (Topic 740) requires that the tax benefit of net operating losses, temporary differences and credit carry forwards be recorded as an asset to the extent that management assesses that realization is “more likely than not.” Realization of the future tax benefits is dependent on our ability to generate sufficient taxable income within the carry forward period. As of each reporting date, management considers new evidence, both positive and negative, that could affect its view of the future realization of deferred tax assets. As of December 31, 2019, based on the evaluation and weighting of both positive and negative evidence, including our achievement of a cumulative three-year income position as of December 31, 2019 and forecasts of future operating results, as well as considering the utilization of net operating losses and tax credits prior to their expiration , management determined that there is sufficient positive evidence to conclude that it is more likely than not the deferred tax assets are realizable. As of December 31, 2019 and 2018, we continue to carry a valuation allowance of $61.7 million and $58.1 million , respectively, against our California state deferred tax assets. Prior to December 31, 2018, because of our history of operating losses, management believed that recognition of the deferred tax assets was not more likely than not (as defined in Topic 740) to be realized and, accordingly, had provided a full valuation allowance. The valuation allowance increased by $3.5 million and decreased by $360.8 million during the years ended December 31, 2019 and 2018, respectively. At December 31, 2019 , we had federal net operating loss carryforwards of approximately $225 million , of which approximately $203 million will expire in the years 2035 through 2036 , and federal business tax credits of approximately $112 million which expire in the years 2020 through 2039 . We also had state net operating loss carryforwards of approximately $450 million , which expire in the years 2020 through 2036 , and California research and development tax credits of approximately $38 million , which do not expire. Under the Internal Revenue Code and similar state provisions, certain substantial changes in our ownership could result in an annual limitation on the amount of net operating loss and credit carryforwards that can be utilized in future years to offset future taxable income. The annual limitation may result in the expiration of net operating losses and credit carryforwards before utilization. We completed a Section 382 analysis through December 31, 2019 , and concluded that an ownership change, as defined under Section 382, had not occurred. The following table summarizes the activity related to our unrecognized tax benefits (in thousands): Year Ended December 31, 2019 2018 2017 Beginning balance $ 76,060 $ 79,342 $ 61,809 Change relating to prior year provision 589 (4,254 ) 247 Change relating to current year provision 2,429 1,083 17,378 Reductions based on the lapse of the applicable statutes of limitations — (111 ) (92 ) Ending balance $ 79,078 $ 76,060 $ 79,342 We do not anticipate that the amount of unrecognized tax benefits existing as of December 31, 2019 will significantly change over the next 12 months. As of December 31, 2019 , we had $79.1 million in unrecognized tax benefits, of which $48.1 million would reduce our income tax provision and the effective tax rate, if recognized. Interest and penalties were nominal or zero for all periods presented. We have elected to record interest and penalties in the accompanying Consolidated Statements of Income as a component of income taxes. |
Net Income Per Share
Net Income Per Share | 12 Months Ended |
Jan. 03, 2020 | |
Earnings Per Share [Abstract] | |
Net Income Per Share | NET INCOME PER SHARE Net income per share - basic and diluted, were computed as follows (in thousands, except per share amounts): Year Ended December 31, 2019 2018 2017 Numerator: Net income $ 321,012 $ 690,070 $ 154,227 Net income allocated to participating securities — — (367 ) Net income allocable to common stock - basic 321,012 690,070 153,860 Adjustment to net income allocated to participating securities — — 22 Net income allocable to common stock - diluted $ 321,012 $ 690,070 $ 153,882 Denominator: Weighted-average common shares outstanding - basic 302,584 297,892 293,588 Dilutive effect of employee stock plans 12,425 14,911 18,415 Weighted-average common shares outstanding - diluted 315,009 312,803 312,003 Net income per share - basic $ 1.06 $ 2.32 $ 0.52 Net income per share - diluted $ 1.02 $ 2.21 $ 0.49 Participating securities included warrants issued in January 2014 to purchase an aggregate of 1.0 million shares of our common stock that were fully exercised in September 2017. Dilutive securities included outstanding stock options, unvested RSUs and ESPP contributions. Certain potential common shares were excluded from our calculation of weighted-average common shares outstanding - diluted because either they would have had an anti-dilutive effect on net income per share or they are related to shares from PSOs and PSUs that were contingently issuable and the contingency had not been satisfied. See to “Note 8. Employee Benefit Plans” for a further description of our equity awards. These potential common shares were as follows (in thousands): Year Ended December 31, 2019 2018 2017 Anti-dilutive securities and contingently issuable shares excluded 9,111 3,968 1,645 |
Commitments
Commitments | 12 Months Ended |
Jan. 03, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments | COMMITMENTS Leases Headquarters Lease In May 2017, we entered into a Lease Agreement (the Lease) for our corporate headquarters located in Alameda, California (the Initial Premises). The Lease was subsequently amended in October 2017, June 2018, April 2019 and August 2019, resulting in, among other things, an increase to the amount of space leased and changes to the lease term. Our right-of-use asset, lease liability and the related lease costs reflect the 221,464 square feet of space we have taken possession of as of December 31, 2019 (the Current Premises) under the amended Lease. We expect to take possession of the remainder of the space provided for under the August 2019 amendment on or prior to April 30, 2020, which will increase the space leased to 228,941 square feet. The term of the Lease continues through October 31, 2031 (the Lease Term). We have two five-year options to extend the Lease; these optional periods have not been considered in the determination of the right-of-use asset or the lease liability for the Lease as we did not consider it reasonably certain that we would exercise any such options. We have made certain tenant improvements on the Initial Premises, for which we received $8.2 million in reimbursements in January 2019. We were also provided an allowance of up to $1.7 million for tenant improvements to the space we obtained under the April 2019 amendment which is expected to be received in 2020. The balance sheet classification of our operating lease assets and liabilities were as follows (in thousands): December 31, 2019 2018 Assets: Right-of-use assets included in other long-term assets $ 41,835 $ 5,867 Liabilities: Current portion included in other current liabilities $ 2,728 $ 2,738 Long-term portion of operating lease liabilities 48,011 12,099 Total operating lease liabilities $ 50,739 $ 14,837 The components of operating lease costs, which are included in selling, general and administrative expenses in our Consolidated Statements of Income, were as follows (in thousands): Year Ended December 31, 2019 2018 2017 (1) Operating lease cost $ 2,844 $ 4,189 $ 3,944 Variable lease cost 1,024 1,661 2,216 Sublease income — — (1,225 ) Total operating lease costs $ 3,868 $ 5,850 $ 4,935 ____________________ (1) The 2017 amounts have not been adjusted for the adoption of Topic 842 and continue to be reported in accordance with the previous lease guidance, ASC Topic 840: Leases . Cash paid for amounts included in the measurement of lease liabilities for the year ended December 31, 2019 was $2.9 million and was included in net cash provided by operating activities in our Consolidated Statements of Cash Flows. As of December 31, 2019 , the maturities of our operating lease liabilities were as follows (in thousands): Year Ending December 31, Amount 2020 $ 4,538 2021 4,669 2022 4,820 2023 5,147 2024 5,407 Thereafter 41,585 Total lease payments 66,166 Less: Imputed interest (13,685 ) Future tenant improvement reimbursements (1,742 ) Operating lease liabilities $ 50,739 As of December 31, 2019 , the weighted average discount rate used to determine the operating lease liability was 3.9% and the weighted average remaining lease term is 11.8 years . Build-to-Suit Lease In October 2019, we entered into a build-to-suit Lease Agreement (the Build-to-Suit Lease) for approximately 220,000 square feet of office space located in Alameda, California (the New Premises), adjacent to the Current Premises. The term of the Build-to-Suit Lease is for a period of 242 months (the Term), which will begin upon the substantial completion of the building and tenant improvements by the lessor. We currently anticipate that the Term will begin in October 2021 (the Lease Commencement Date). The monthly base rent under the Build-to-Suit Lease will equal a percentage of the total development costs incurred in connection with the development of the New Premises (excluding the cost of the tenant improvements in excess of the allowance provided by the lessor and any development costs we pay) and is currently estimated to be about $0.7 million , subject to an annual increase of 3% during the Term. We will also be responsible for paying operating expenses related to the New Premises. The rent payments will begin sixty days following commencement of the Term. We have been provided a tenant improvement allowance for the New Premises of approximately $16.5 million . To the extent that the total development costs of the New Premises exceeds $525 per square foot, we will also pay 50% of such excess costs prior to the commencement of the Term, and may be required to secure such amount and the cost of the tenant improvements in excess of the allowance by providing a letter of credit or depositing such amounts in an account with the lessor’s lender prior to the start of construction. The Build-to-Suit Lease includes two five-year options to extend the term of the Build-to-Suit Lease, exercisable under certain conditions and at a market rate determined in accordance with the Build-to-Suit Lease. We have a one-time option to terminate the Build-to-Suit Lease without cause after the 180 th month of the Term, exercisable under certain conditions as described in the Build-to-Suit Lease and subject to a termination payment calculated in accordance with the Build-to-Suit Lease. In addition, we have a right of first offer to purchase the New Premises, subject to certain procedures and exclusions set forth in the Build-to-Suit Lease. We have determined that, under the guidance provided in Topic 842, we do not have control of the New Premises during the construction period . Therefore, we will not record a right-of-use asset or lease liability for the Build-to-Suit Lease until the Lease Commencement Date . We will evaluate the classification the Build-to-Suit Lease as an operating lease or financing lease at the Lease Commencement Date. Letters of Credit We have obtained standby letters of credit related to our lease obligations and certain other obligations with combined credit limits of $1.6 million and $1.1 million as of December 31, 2019 and 2018 , respectively. None of our letters of credit have been drawn upon. All of the letters of credit are fully collateralized by certificates of deposit. |
Quarterly Financial Data (Unaud
Quarterly Financial Data (Unaudited) | 12 Months Ended |
Jan. 03, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Data (Unaudited) | QUARTERLY FINANCIAL DATA (UNAUDITED) Selected unaudited quarterly financial data was as follows (in thousands, except per share data): Fiscal 2019 Quarter Ended March 31, June 30, September 30, December 31, (4) Total revenues (1) $ 215,487 $ 240,275 $ 271,703 $ 240,310 Gross profit (2) $ 172,080 $ 186,136 $ 184,231 $ 184,406 Income from operations $ 84,559 $ 91,989 $ 115,606 $ 77,316 Net income $ 75,775 $ 79,042 $ 97,452 $ 68,743 Net income per share: Basic $ 0.25 $ 0.26 $ 0.32 $ 0.23 Diluted $ 0.24 $ 0.25 $ 0.31 $ 0.22 Fiscal 2018 Quarter Ended March 31, June 30, September 30, December 31, Total revenues (1) $ 213,719 $ 186,108 $ 225,397 $ 228,602 Gross profit (2) $ 128,633 $ 139,839 $ 155,586 $ 168,873 Income from operations $ 116,307 $ 85,770 $ 125,176 $ 111,602 Net income (3) $ 115,857 $ 87,494 $ 126,630 $ 360,089 Net income per share: Basic $ 0.39 $ 0.29 $ 0.42 $ 1.20 Diluted $ 0.37 $ 0.28 $ 0.41 $ 1.15 ____________________ (1) Total revenues for the quarters ended March 31, 2019, June 30, 2019, September 30, 2019 and December 31, 2019 included $10.0 million , $20.4 million , $50.6 million and $15.1 million in milestone revenue, respectively, as compared to $66.5 million , $25.8 million , $42.6 million and $29.6 million during the comparable periods in 2018. Due to uncertainties surrounding the timing and achievement of regulatory and development milestones, it is difficult to predict future milestone revenues and such milestones can vary significantly from period to period. (2) Gross profit is computed as net product revenues less cost of goods sold. (3) Net income for the quarter ended December 31, 2018 included a $244.1 million income tax benefit related to the release of substantially all of the valuation allowance against our deferred tax assets. (4) |
Organization and Summary of S_2
Organization and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Jan. 03, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation |
Fiscal Period | We have adopted a 52- or 53-week fiscal year policy that ends on the Friday closest to December 31st. Fiscal year 2019, which was a 53-week fiscal year, ended on January 3, 2020, fiscal year 2018, which was a 52-week fiscal year, ended on December 28, 2018 and fiscal year 2017, which was a 52-week fiscal year, ended on December 29, 2017. For convenience, references in this report as of and for the fiscal years ended January 3, 2020, December 28, 2018 and December 29, 2017 are indicated as being as of and for the years ended December 31, 2019, 2018 and 2017, respectively. |
Segment Information | Segment Information We operate in one business segment that focuses on the discovery, development and commercialization of new medicines for difficult-to-treat cancers. Our Chief Executive Officer, as the chief operating decision-maker, manages and allocates resources to our operations on a total consolidated basis. Consistent with this decision-making process, our Chief Executive Officer uses consolidated, single-segment financial information for purposes of evaluating performance, forecasting future period financial results, allocating resources and setting incentive targets. |
Use of Estimates | Use of Estimates The preparation of the accompanying Consolidated Financial Statements conforms to accounting principles generally accepted in the U.S., which requires management to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, equity, revenues and expenses, and related disclosures. On an ongoing basis, we evaluate our significant estimates. We base our estimates on historical experience and on various other market-specific and other relevant assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ materially from those estimates. |
Recently Adopted Accounting Pronouncements and Recent Accounting Pronouncements Not Yet Adopted | Recent Accounting Pronouncements Not Yet Adopted In December 2019, the Financial Accounting Standards Board (FASB) issued ASU 2019-12, Income Taxes (Topic 740)-Simplifying the Accounting for Income Taxes (ASU 2019-12). ASU 2019-12 simplifies the accounting for income taxes by removing certain exceptions to the general principles in Topic 740 and clarifying and amending existing guidance. ASU 2019-12 will be effective for us in the first quarter of 2021 with early adoption permitted. We are currently assessing the impact of ASU 2019-12 on our Consolidated Financial Statements. In November 2018, the FASB issued ASU No. 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606 (ASU 2018-18). ASU 2018-18 clarifies that certain transactions between collaborative arrangement participants should be accounted for as revenue under Topic 606 when the counterparty is a customer for a distinct good or service (i.e. a unit of account). For units of account that are in the scope of Topic 606, all of the guidance in Topic 606 should be applied, including the guidance on recognition, measurement, presentation and disclosure. ASU 2018-18 also adds a reference in ASC Topic 808, Collaborative Arrangements (Topic 808) to the unit of account guidance in Topic 606 and requires that it be applied only to assess whether transactions in a collaborative arrangement are in the scope of Topic 606. ASU 2018-18 will preclude entities from presenting amounts related to transactions with a counterparty in a collaborative arrangement that is not a customer as revenue from contracts with customers. ASU 2018-18 is effective for us in the first quarter of 2020. We are currently assessing the impact of ASU 2018-18 on our Consolidated Financial Statements. In January 2017, the FASB issued ASU No. 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (ASU 2017-04) . ASU 2017-04 eliminated Step 2 from the goodwill impairment test. Instead, under the amendments in ASU 2017-04, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. Additionally, an entity should consider income tax effects from any tax-deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. ASU 2017-04 is effective for us in the first quarter of 2020. We do not expect the adoption of ASU 2017-04 to have a material impact on our Consolidated Financial Statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326) (ASU 2016-13) . ASU 2016-13 implements an impairment model, known as the current expected credit loss model that is based on expected losses rather than incurred losses. Under the new guidance, an entity will recognize as an allowance its estimate of expected credit losses. ASU 2016-13 is effective for us in the first quarter of 2020. We are currently assessing the impact of ASU 2016-13 on our Consolidated Financial Statements. Recently Adopted Accounting Pronouncements In the third quarter of 2019, we adopted ASU No. 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (ASU 2018-15). ASU 2018-15 requires a customer in a hosting arrangement that is a service contract to follow the guidance in Accounting Standards Codification (ASC) Subtopic 350-40 to determine which implementation costs to capitalize as an asset related to the service contract and which costs to expense. ASU 2018-15 requires capitalized implementation costs to be expensed over the term of the hosting arrangement, which includes reasonably certain renewals. We adopted ASU 2018-15 using the prospective transition method in the accompanying Consolidated Financial Statements. The adoption of ASU 2018-15 did not have a material impact on our Consolidated Financial Statements. In the first quarter of 2019, we adopted ASU 2018-02, Income Statement—Reporting Comprehensive Income (Topic 220) (ASU 2018-02). There was no financial impact from the adoption of ASU 2018-02 and we did not make an election to reclassify the income tax effects of the Tax Cuts and Jobs Act of 2017 from accumulated other comprehensive income (loss) to accumulated deficit. In connection with the adoption of ASU 2018-02, we adopted the individual unit of account approach for releasing income tax effects from accumulated other comprehensive income (loss). In the first quarter of 2019, we also adopted ASU 2017-08, Receivables—Nonrefundable Fees and Other Costs (Subtopic 310-20) |
Cash | Cash and Investments We consider all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash equivalents include high-grade, short-term investments in money market funds, certificates of deposit and marketable debt securities which are subject to minimal credit and market risk. |
Investments | We designate all investments in marketable debt securities as available-for-sale and therefore, report such investments at fair value, with unrealized gains and losses recorded in accumulated other comprehensive income (loss). For securities sold prior to maturity, the cost of securities sold is based on the specific identification method. We include realized gains and losses on the sale of investments in other income (expense), net in the accompanying Consolidated Statements of Income. We classify those investments that we do not require for use in current operations and that mature in more than 12 months as long-term investments in the accompanying Consolidated Balance Sheets. The classification of restricted cash equivalents as short-term or long-term is dependent upon the longer of the remaining term to maturity of the investment or the remaining term of the related restriction . We subject all of our investments to a quarterly impairment review. We recognize an impairment charge when a decline in the fair value of an investment below its cost basis is judged to be other-than-temporary. Factors considered in determining whether a loss is temporary include the length of time and extent to which the investments fair value has been less than their cost basis, the financial condition and near-term prospects of the issuer, extent of the loss related to credit of the issuer, the expected cash flows from the security, our intent to sell the security and whether or not we will be required to sell the security before we are able to recover our carrying value. |
Fair Value Measurements | Fair Value Measurements We define fair value as the amounts that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). When determining the fair value measurements for assets and liabilities which are required to be recorded at fair value, we consider the principal or most advantageous market in which we would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as risks inherent in valuation techniques, transfer restrictions and credit risks. |
Accounts Receivable | Accounts Receivable We record trade accounts receivable net of allowances for chargebacks and cash discounts for prompt payment, as described further below. Estimates of our allowance for doubtful accounts are determined based on existing contractual payment terms, historical payment patterns of our customers and individual customer circumstances, an analysis of days sales outstanding by geographic region and a review of the local economic environment and its potential impact on government funding and reimbursement practices. Historically, the amounts of uncollectible accounts receivable that have been written off have been insignificant. |
Inventory | Inventory We value inventory at the lower of cost or net realizable value. We determine the cost of inventory using the standard-cost method, which approximates actual cost based on a first-in, first-out method. We analyze our inventory levels quarterly and write down inventory subject to expiry in excess of expected requirements, or that has a cost basis in excess of its expected net realizable value. These write downs are charged to either cost of goods sold or the cost of supplied product included in collaboration revenues in the accompanying Consolidated Statements of Income. On a quarterly basis, we analyze our estimated production levels for the following twelve-month period, which is our normal operating cycle, and reclassify inventory we expect to use or sell in periods beyond the next twelve months into other long-term assets in the accompanying Consolidated Balance Sheets. |
Property and Equipment | Property and Equipment We record property and equipment at cost, net of depreciation. We compute depreciation using the straight-line method based on estimated useful lives of the assets, which ranges up to 15 years and depreciate leasehold improvements over the lesser of their estimated useful lives or the remainder of the lease term. We charge repairs and maintenance costs to expense as incurred. We periodically review property and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. We did not recognize impairment charges in any of the periods presented . |
Goodwill | Goodwill We recorded goodwill amounts as the excess purchase price over tangible assets, liabilities and intangible assets acquired based on their estimated fair value. We periodically review the carrying amount of goodwill for impairment (at least annually) and whenever events or changes in circumstance indicate that the carrying value may not be recoverable. Historically, we assessed the recoverability of our goodwill on the last day of our third quarter. Beginning in 2019, we changed the date of our annual goodwill impairment assessment to the first day of our fourth quarter to allow for operational expediency. The change in goodwill impairment testing date does not represent a significant change to our accounting for goodwill . The assessment of recoverability may first consider qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. We perform a quantitative assessment if the qualitative assessment results in a more-likely-than-not determination or if a qualitative assessment is not performed. The quantitative assessment considers whether the carrying amount of a reporting unit exceeds its fair value, in which case an impairment charge is recorded to the extent the carrying amount of the reporting unit’s goodwill exceeds its fair value. We continue to operate in one |
Collaboration Agreements | Collaboration Agreements We assess whether our collaboration agreements are subject to ASC 808: Collaborative Arrangements (Topic 808) based on whether they involve joint operating activities and whether both parties have active participation in the arrangement and are exposed to significant risks and rewards. To the extent that the arrangement falls within the scope of Topic 808, we assess whether the payments between us and our collaboration partner are subject to other accounting literature. If we conclude that payments from the collaboration partner to us represent consideration from a customer, then we account for those payments within the scope of Topic 606. However, if we conclude that our collaboration partner is not a customer for certain activities, such as for certain collaborative research and development activities, we present such payments as a reduction of research and development expense. |
Revenue | Revenue In the first quarter of 2018, we adopted Topic 606 using the modified retrospective method applied to those contracts that were not completed as of the adoption date. Results for the years ended December 31, 2019 and 2018 are presented under Topic 606, while results for the year ended December 31, 2017 have not been adjusted and continue to be reported in accordance with our historic accounting under previous revenue recognition guidance, ASC Topic 605: Revenue Recognition (Topic 605). Under Topic 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration to which the entity is entitled to in exchange for those goods or services. To determine revenue recognition for arrangements that are within the scope of Topic 606, we perform the following five steps: 1) identify the contract(s) with a customer; 2) identify the performance obligations in the contract; 3) determine the transaction price; 4) allocate the transaction price to the performance obligations in the contract; and 5) recognize revenue when (or as) we satisfy a performance obligation. We only apply the five-step model to contracts when it is probable that we will collect the consideration we are entitled to in exchange for the goods or services we transfer to the customer. Net Product Revenues We sell our products principally to specialty distributors and specialty pharmacy providers, or collectively, our Customers. These Customers subsequently resell our products to health care providers and patients. In addition to distribution agreements with Customers, we enter into arrangements with health care providers and payors that provide for government-mandated and/or privately-negotiated rebates, chargebacks and discounts with respect to the purchase of our products. Revenues from product sales are recognized when the Customer obtains control of our product, which occurs at a point in time, typically upon delivery to the Customer. Product Sales Discounts and Allowances We record revenues from product sales at the net sales price (transaction price), which includes estimates of variable consideration for which reserves are established and that result from discounts, chargebacks, rebates, co-pay assistance, returns and other allowances that are offered within contracts between us and our Customers, health care providers, payors and other indirect customers relating to the sales of our products. These reserves are based on the amounts earned or to be claimed on the related sales and are classified as reductions of accounts receivable (if the amount is payable to the Customer) or a current liability (if the amount is payable to a party other than a Customer). Where appropriate, these estimates take into consideration a range of possible outcomes that are probability-weighted for relevant factors such as our historical experience, current contractual and statutory requirements, specific known market events and trends, industry data and forecasted Customer buying and payment patterns. Overall, these reserves reflect our best estimates of the amount of consideration to which we are entitled based on the terms of our contracts. The amount of variable consideration that is included in the transaction price may be constrained, and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from our estimates. If actual results in the future vary from our estimates, we will adjust these estimates, which would affect net product revenues and earnings in the period such variances become known. Chargebacks: Chargebacks are discounts that occur when contracted Customers purchase directly from a specialty distributor. Contracted Customers, which currently consist primarily of Public Health Service institutions, Federal government entities purchasing via the Federal Supply Schedule, Group Purchasing Organizations, and health maintenance organizations, generally purchase the product at a discounted price. The specialty distributor, in turn, charges back to us the difference between the price initially paid by the specialty distributor and the discounted price paid to the specialty distributor by the Customer. The allowance for chargebacks is based on actual chargebacks received and an estimate of sales to contracted Customers. Discounts for Prompt Payment: Our Customers in the U.S. receive a discount of 2% for prompt payment. We expect our Customers will earn 100% of their prompt payment discounts and, therefore, we deduct the full amount of these discounts from total product sales when revenues are recognized. Rebates: Allowances for rebates include mandated discounts under the Medicaid Drug Rebate Program, other government programs and commercial contracts. Rebate amounts owed after the final dispensing of the product to a benefit plan participant are based upon contractual agreements or legal requirements with public sector benefit providers, such as Medicaid. The allowance for rebates is based on statutory or contractual discount rates and expected utilization. Our estimates for the expected utilization of rebates are based on Customer and payer data received from the specialty pharmacies and distributors and historical utilization rates. Rebates are generally invoiced by the payer and paid in arrears, such that the accrual balance consists of an estimate of the amount expected to be incurred for the current quarter’s shipments to our Customers, plus an accrual balance for known prior quarters’ unpaid rebates. If actual future rebates vary from estimates, we may need to adjust our accruals, which would affect net product revenues in the period of adjustment. Allowances for rebates also include amounts related to the Medicare Part D Coverage Gap Discount Program. In the U.S. during 2018 and 2017, the Medicare Part D prescription drug benefit mandated participating manufacturers to fund 50% of the Medicare Part D insurance coverage gap for prescription drugs sold to eligible patients. This amount increased to 70% in 2019. Our estimates for expected Medicare Part D coverage gap amounts are based on Customer and payer data received from specialty pharmacies and distributors and historical utilization rates. Funding of the coverage gap is invoiced and paid in arrears so that the accrual balance consists of an estimate of the amount expected to be incurred for the current quarter’s shipments to Customer, plus an accrual balance for known prior quarters’ unpaid claims. If actual future funding varies from estimates, we may need to adjust our accruals, which would affect net product revenues in the period of adjustment. Co-payment Assistance: Patients who have commercial insurance and meet certain eligibility requirements may receive co-payment assistance. We accrue a liability for co-payment assistance based on actual program participation and estimates of program redemption using Customer data provided by the specialty distributor that administers the copay program. Other Customer Credits: We pay fees to our Customers for account management, data management and other administrative services. To the extent the services received are distinct from the sale of products to the Customer, we classify these payments in selling, general and administrative expenses in our Consolidated Statements of Income. Collaboration Revenues We enter into collaboration arrangements, under which we license certain rights to our intellectual property to third parties. The terms of these arrangements typically include payment to us for one or more of the following: non-refundable, up-front license fees; development, regulatory and sales-based milestone payments; product supply services; development cost reimbursements; profit sharing arrangements; and royalties on net sales of licensed products. Except for profit sharing arrangements, payments for product supply services and certain development cost reimbursements, each of these payment types were within the scope of Topic 606 during the years ended December 31, 2019 and 2018. As part of the accounting for these arrangements, we develop assumptions that require judgment to determine the standalone selling price for each performance obligation identified in the contract. These key assumptions may include forecasted revenues, clinical development timelines and costs, reimbursement rates for personnel costs, discount rates and probabilities of technical and regulatory success. Up-front License Fees: If the license to our intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, we recognize revenues from nonrefundable, up-front fees allocated to the license when the license is transferred to the licensee and the licensee is able to use and benefit from the license. For licenses that are bundled with other promises, we utilize judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue from non-refundable, up-front fees. We evaluate the measure of progress each reporting period and, if necessary, adjust the measure of performance and related revenue recognition. Regulatory and Development Milestone Payments: At the inception of each arrangement that includes development milestone payments, we evaluate whether the milestones are considered probable of being reached and estimate the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within our or the licensee’s control, such as regulatory approvals, are not considered probable of being achieved until uncertainty associated with the approvals has been resolved. The transaction price is then allocated to each performance obligation, on a relative standalone selling price basis, for which we recognize revenue as or when the performance obligations under the contract are satisfied. At the end of each subsequent reporting period, we re-evaluate the probability of achieving such development and regulatory milestones and any related constraint, and if necessary, adjust our estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis. Product Supply Services: Arrangements that include a promise for future supply of drug product for either clinical development or commercial supply at the licensee’s discretion are generally considered as options. We assess if these options provide a material right to the licensee and if so, they are accounted for as separate performance obligations. Development Cost Reimbursements: Our collaboration arrangements may include promises of future clinical development and drug safety services, as well as participation on certain joint committees. When such services are provided to a customer, and they are distinct from the licenses provided to our collaboration partners, these promises are accounted for as a separate performance obligation which we estimate using internal development costs incurred and projections through the term of the arrangements. We record revenue for these services as the performance obligations are satisfied over time. Profit Sharing Arrangements: Under the terms of our collaboration agreement with Genentech for cobimetinib, we are entitled to a share of U.S. profits and losses received in connection with commercialization of cobimetinib. We account for such arrangements in accordance with Topic 808. We have determined that we are an agent under the agreement and therefore revenues are recorded net of costs incurred. We record U.S. profits and losses under the collaboration agreement in the period earned based on our estimate of those amounts. We recognized an annual profit under the agreement for the years ending December 31, 2019 and 2018 and accordingly, those profits are recognized as collaboration revenues in the accompanying Consolidated Statements of Income. Prior to 2018, the commercialization of cobimetinib in the U.S. had not been profitable for any annual period and accordingly, losses for periods prior to 2018 were recognized as selling, general and administrative expenses in the accompanying Consolidated Statements of Income. Royalty and Sales-based Milestone Payments: For arrangements that include royalties and sales-based milestone payments, including milestone payments earned for the first commercial sale of a product, the license is deemed to be the predominant item to which such payments relate and we recognize revenue at the later of when the related sales occur or when the performance obligation to which the royalty has been allocated has been satisfied. Cost of Goods Sold Cost of goods sold is related to our product revenues and consists primarily of a 3% royalty we are required to pay GlaxoSmithKline (GSK) on all net sales of any product incorporating cabozantinib, the cost of manufacturing, indirect labor costs, write-downs related to expiring and excess inventory, shipping and other third-party logistics and distribution costs for our product. |
Research and Development Expenses | Research and Development Expenses Research and development costs are expensed as incurred and primarily include: (1) direct and indirect internal costs for drug discovery; (2) upfront license and project initiation fees, license option fees, funded research and milestone payments incurred for our in-licensing arrangements with our collaboration partners; and (3) development costs associated with our clinical trial projects, which include fees paid to Contract Research Organizations (CRO) performing work on our behalf. Our clinical trial projects have been executed with support from third-party CROs, who specialize in conducting and managing global clinical trials. We accrue expenses for clinical trial activities performed by the CROs based upon the estimated amount of work completed on each trial. For clinical trial expenses, the significant factors used in estimating accruals include direct CRO costs, the number of patients enrolled, the number of active clinical sites involved, the duration for which the patients will be enrolled in the trial and patient out of pocket costs. We monitor patient enrollment levels and related activities to the extent possible through CRO meetings and correspondence, internal reviews and review of contractual terms. We base our estimates on the best information available at the time. However, additional information may become available to us which may allow us to make a more accurate estimate in future periods. In this event, we may be required to record adjustments to research and development expenses in future periods when the actual level of activity becomes more certain. As described further above, certain payments made to us from our collaboration partners may be presented as a reduction of research and development expense. Development, regulatory or commercial milestone payments to collaboration partners are recorded as research and development costs when we determine such payments become probable. |
Leases | Leases We determine if an arrangement includes a lease at the inception of the agreement. For each of our lease arrangements, we record a right-of-use asset representing our right to use an underlying asset for the lease term and a lease liability representing our obligation to make lease payments. Operating lease right-of-use assets and liabilities are recognized at the lease commencement date based on the net present value of lease payments over the lease term. In determining the weighted average discount rate used to calculate the net present value of lease payments, we use our incremental borrowing rate based on the information available at the lease commencement date. Our leases may include options to extend or terminate the lease which are included in the lease term when it is reasonably certain that we will exercise any such options. Lease expense for our operating leases is recognized on a straight-line basis over the lease term. We have elected not to apply the recognition requirements of Topic 842 for short-term leases. |
Advertising | Advertising Advertising expenses were $17.9 million , $14.8 million and $8.6 million for the years ended December 31, 2019 , 2018 and 2017 , respectively. We expense the costs of advertising, including promotional expenses, as incurred. Advertising expenses are recorded in sales, general and administrative expenses. |
Stock-Based Compensation | Stock-Based Compensation We account for stock-based payments to employees, including grants of service-based restricted stock awards, performance-based restricted stock awards (PSUs), service-based stock options, performance-based stock options (PSOs), and purchases under our 2000 Employee Stock Purchase Plan (ESPP) in accordance with ASC 718, Compensation-Stock Compensation , which requires that stock-based payments (to the extent they are compensatory) be recognized in our Consolidated Statements of Income based on their fair values. We account for forfeitures of stock-based awards as they occur. The expense for stock-based compensation is based on the grant date fair value of the award. The grant date fair value of restricted stock units (RSUs) and PSUs are estimated as the value of the underlying shares of our common stock. The grant date fair values are estimated using a Monte Carlo simulation pricing model for PSOs with market vesting conditions and a Black-Scholes Merton option pricing model for other stock options. Both option pricing models require the input of subjective assumptions. These variables include, but are not limited to, the expected volatility of our stock price and the expected term of the awards. We consider both implied and historical volatilities when developing an estimate of expected volatility. We estimate the term using historical data. We recognize compensation expense over the requisite service period on an accelerated basis for awards with a market or performance condition and on a straight-line basis for service-based stock options and awards. Compensation expense relating to PSUs is recognized when we determine that it is probable that the performance goals will be achieved, which we assess on a quarterly basis. |
Income Taxes | Income Taxes Our income tax provision or benefit is computed under the asset and liability method. Significant estimates are required in determining our income tax provision or benefit. Some of these estimates are based on interpretations of existing tax laws or regulations. We recognize deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined on the basis of the difference between the tax basis of assets and liabilities and their respective financial reporting amounts (temporary differences) at enacted tax rates in effect for the years in which the differences are expected to reverse. A valuation allowance is established for deferred tax assets for which it is more likely than not that some portion or all of the deferred tax assets, including net operating losses and tax credits, will not be realized. We periodically re-assess the need for a valuation allowance against our deferred tax assets based on various factors including our historical earnings experience by taxing jurisdiction, and forecasts of future operating results and utilization of net operating losses and tax credits prior to their expiration. Significant judgment is required in making this assessment and, to the extent that a reversal of any portion of our valuation allowance against our deferred tax assets is deemed appropriate, a tax benefit will be recognized against our income tax provision in the period of such reversal. Prior to 2018, we recorded a valuation allowance that fully offset our deferred tax assets. In the fourth quarter of 2018, based on our evaluation of various factors, including our achievement of a cumulative three-year income position as of December 28, 2018 and forecasts of future operating results, we released substantially all of our valuation allowance against our deferred tax assets and recorded a corresponding income tax benefit as described in “Note 9. Income Taxes”, below. We continue to maintain a valuation allowance against our California state deferred tax assets. We recognize tax benefits from uncertain tax positions only if it is more likely than not that the tax position will be sustained upon examination by the tax authorities based on the technical merits of the position . An adverse resolution of one or more of these uncertain tax positions in any period could have a material impact on the results of operations for that period. |
Foreign Currency Translation and Remeasurement | Foreign Currency Translation and Remeasurement |
Revenues (Tables)
Revenues (Tables) | 12 Months Ended |
Jan. 03, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | Revenues consisted of the following (in thousands): Year Ended December 31, 2019 2018 2017 Product revenues: Gross product revenues $ 957,621 $ 738,529 $ 402,569 Discounts and allowances (197,671 ) (119,250 ) (53,561 ) Net product revenues 759,950 619,279 349,008 Collaboration revenues: License revenues 161,299 192,188 96,637 Research and development service revenues 49,965 39,501 8,737 Other collaboration revenues (3,439 ) 2,858 (1,905 ) Total collaboration revenues 207,825 234,547 103,469 Total revenues $ 967,775 $ 853,826 $ 452,477 Net product revenues disaggregated by product were as follows (in thousands): Year Ended December 31, 2019 2018 2017 CABOMETYX $ 733,421 $ 599,946 $ 324,000 COMETRIQ 26,529 19,333 25,008 Net product revenues $ 759,950 $ 619,279 $ 349,008 |
Revenues Disaggregated by Significant Customer | The percentage of total revenues by customer who individually accounted for 10% or more of our total revenues were as follows: Year Ended December 31, 2019 2018 2017 Ipsen 16 % 21 % 15 % Affiliates of CVS Health Corporation 15 % 13 % 16 % Affiliates of McKesson Corporation 12 % 12 % 11 % Affiliates of AmerisourceBergen Corporation 10 % 8 % 8 % Accredo Health, Incorporated 9 % 9 % 11 % Diplomat Specialty Pharmacy 5 % 9 % 18 % |
Revenues Disaggregated by Geographic Region | Revenues by geographic region were as follows (in thousands): Year Ended December 31, 2019 2018 2017 U.S. $ 770,244 $ 632,927 $ 367,906 Europe 152,771 182,879 69,792 Japan 44,760 38,020 14,779 Total revenues $ 967,775 $ 853,826 $ 452,477 |
Activities and Ending Reserve Balances for Significant Categories of Discounts and Allowances | The activities and ending reserve balances for each significant category of discounts and allowances (which constitute variable consideration) were as follows (in thousands): Chargebacks and Discounts for Prompt Payment Other Customer Credits/Fees and Co-pay Assistance Rebates Total Balance at December 31, 2017 $ 1,928 $ 1,795 $ 5,770 $ 9,493 Provision related to sales made in: Current period 75,543 13,017 31,040 119,600 Prior periods (403 ) 206 (153 ) (350 ) Payments and customer credits issued (74,746 ) (11,980 ) (24,741 ) (111,467 ) Balance at December 31, 2018 2,322 3,038 11,916 17,276 Provision related to sales made in: Current period 129,936 15,605 48,250 193,791 Prior periods 3,989 (111 ) 2 3,880 Payments and customer credits issued (128,733 ) (15,035 ) (44,946 ) (188,714 ) Balance at December 31, 2019 $ 7,514 $ 3,497 $ 15,222 $ 26,233 |
Collaboration Agreements (Table
Collaboration Agreements (Tables) | 12 Months Ended |
Jan. 03, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Collaborative Revenues Under Collaboration Agreement | Profits and losses on U.S. commercialization and royalty revenues on ex-U.S. sales under the collaboration agreement with Genentech were as follows (in thousands): Year Ended December 31, 2019 2018 2017 Profits and losses on U.S. commercialization $ 4,615 $ 8,084 $ (2,140 ) Royalty revenues on ex-U.S. sales $ 5,679 $ 5,564 $ 6,398 |
Cash and Investments (Tables)
Cash and Investments (Tables) | 12 Months Ended |
Jan. 03, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Reconciliation of Cash, Cash Equivalents, and Restricted Cash | A reconciliation of cash, cash equivalents, and restricted cash equivalents reported within our Consolidated Balance Sheets to the amount reported within the accompanying Consolidated Statements of Cash Flows was as follows (in thousands): December 31, 2019 2018 2017 Cash and cash equivalents $ 266,501 $ 314,775 $ 183,164 Short-term restricted cash equivalents — — 504 Restricted cash equivalents included in long-term investments 1,636 1,100 4,646 Cash, cash equivalents, and restricted cash equivalents as reported within the accompanying Consolidated Statements of Cash Flows $ 268,137 $ 315,875 $ 188,314 |
Reconciliation of Cash, Cash Equivalents, and Restricted Cash | A reconciliation of cash, cash equivalents, and restricted cash equivalents reported within our Consolidated Balance Sheets to the amount reported within the accompanying Consolidated Statements of Cash Flows was as follows (in thousands): December 31, 2019 2018 2017 Cash and cash equivalents $ 266,501 $ 314,775 $ 183,164 Short-term restricted cash equivalents — — 504 Restricted cash equivalents included in long-term investments 1,636 1,100 4,646 Cash, cash equivalents, and restricted cash equivalents as reported within the accompanying Consolidated Statements of Cash Flows $ 268,137 $ 315,875 $ 188,314 |
Investments by Security Type | Cash and investments consisted of the following (in thousands): December 31, 2019 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Investment securities available-for-sale: Commercial paper $ 389,573 $ — $ — $ 389,573 Corporate bonds 752,295 3,934 (3 ) 756,226 U.S. Treasury and government sponsored enterprises 166,483 187 (5 ) 166,665 Total investment securities available-for-sale 1,308,351 4,121 (8 ) 1,312,464 Cash 40,964 — — 40,964 Money market funds 2,467 — — 2,467 Certificates of deposit 32,728 5 — 32,733 Total cash and investments $ 1,384,510 $ 4,126 $ (8 ) $ 1,388,628 December 31, 2018 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Investment securities available-for-sale: Commercial paper $ 381,134 $ — $ (1 ) $ 381,133 Corporate bonds 344,741 180 (857 ) 344,064 U.S. Treasury and government sponsored enterprises 55,224 2 (25 ) 55,201 Total investment securities available-for-sale 781,099 182 (883 ) 780,398 Cash 6,883 — — 6,883 Money market funds 47,744 — — 47,744 Certificates of deposit 16,596 — — 16,596 Total cash and investments $ 852,322 $ 182 $ (883 ) $ 851,621 |
Fair Value and Gross Unrealized Losses of Investments Available-for-Sale in an Unrealized Loss Position | The fair value and gross unrealized losses on investment securities available-for-sale in an unrealized loss position were as follows (in thousands): December 31, 2019 In an Unrealized Loss Position Less than 12 Months In an Unrealized Loss Position 12 Months or Greater Total Fair Value Gross Fair Value Gross Fair Value Gross Corporate bonds $ 14,529 $ (3 ) $ — $ — $ 14,529 $ (3 ) U.S. Treasury and government sponsored enterprises 2,848 (5 ) — — 2,848 (5 ) Total $ 17,377 $ (8 ) $ — $ — $ 17,377 $ (8 ) December 31, 2018 In an Unrealized Loss Position Less than 12 Months In an Unrealized Loss Position 12 Months or Greater Total Fair Value Gross Fair Value Gross Fair Value Gross Corporate bonds $ 236,162 $ (606 ) $ 39,627 $ (251 ) $ 275,789 $ (857 ) U.S. Treasury and government sponsored enterprises 28,105 (16 ) 9,182 (9 ) 37,287 (25 ) Commercial paper 7,091 (1 ) — — 7,091 (1 ) Total $ 271,358 $ (623 ) $ 48,809 $ (260 ) $ 320,167 $ (883 ) |
Fair Value of Cash Equivalents and Investments by Contractual Maturity | The fair value of investment securities available-for-sale by contractual maturity were as follows (in thousands): December 31, 2019 2018 Maturing in one year or less $ 789,913 $ 626,711 Maturing after one year through five years 522,551 153,687 Total investment securities available-for-sale $ 1,312,464 $ 780,398 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Jan. 03, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value of Financial Assets Measured on a Recurring Basis | The classifications within the fair value hierarchy of our financial assets that were measured and recorded at fair value on a recurring basis were as follows (in thousands): December 31, 2019 Level 1 Level 2 Total Commercial paper $ — $ 389,573 $ 389,573 Corporate bonds — 756,226 756,226 U.S. Treasury and government sponsored enterprises — 166,665 166,665 Total investment securities available-for-sale — 1,312,464 1,312,464 Money market funds 2,467 — 2,467 Certificates of deposit — 32,733 32,733 Total financial assets carried at fair value $ 2,467 $ 1,345,197 $ 1,347,664 December 31, 2018 Level 1 Level 2 Total Commercial paper $ — $ 381,133 $ 381,133 Corporate bonds — 344,064 344,064 U.S. Treasury and government sponsored enterprises — 55,201 55,201 Total investment securities available-for-sale — 780,398 780,398 Money market funds 47,744 — 47,744 Certificates of deposit — 16,596 16,596 Total financial assets carried at fair value $ 47,744 $ 796,994 $ 844,738 |
Inventory (Tables)
Inventory (Tables) | 12 Months Ended |
Jan. 03, 2020 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventory consisted of the following (in thousands): December 31, 2019 2018 Raw materials $ 2,709 $ 1,922 Work in process 9,447 6,170 Finished goods 4,367 3,836 Total $ 16,523 $ 11,928 Balance Sheet classification: Current portion included in inventory $ 12,886 $ 9,838 Long-term portion included in other long-term assets 3,637 2,090 Total $ 16,523 $ 11,928 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Jan. 03, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment consisted of the following (in thousands): Estimated Useful Lives December 31, 2019 2018 Leasehold improvements up to 15 years $ 33,904 $ 33,941 Computer equipment and software 3 years 17,338 15,022 Furniture and fixtures 5 to 7 years 13,053 12,709 Laboratory equipment 5 years 8,904 5,668 Construction in progress 1,253 866 74,452 68,206 Less: accumulated depreciation (25,560 ) (17,309 ) Property and equipment, net $ 48,892 $ 50,897 |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 12 Months Ended |
Jan. 03, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Allocated Employee Stock-Based Compensation Expense | We allocated the stock-based compensation expense for our equity incentive plans and our ESPP as follows (in thousands): Year Ended December 31, 2019 2018 2017 Research and development $ 19,374 $ 13,115 $ 7,569 Selling, general and administrative 37,228 27,511 16,369 Total stock-based compensation $ 56,602 $ 40,626 $ 23,938 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value | The weighted average grant-date fair value per share of stock options and ESPP purchases were as follows: Year Ended December 31, 2019 2018 2017 Stock options, including PSOs $ 8.19 $ 9.07 $ 11.42 ESPP $ 4.85 $ 6.40 $ 6.00 |
Schedule of Fair Value of Employee Share-Based Payments Awards Stock Option Assumptions and Weighted Average Fair Values | The grant-date fair value of stock option grants, including PSOs, and ESPP purchases was estimated using the following assumptions: Year Ended December 31, 2019 2018 2017 Stock options, including PSOs: Risk-free interest rate 1.77 % 2.81 % 1.98 % Dividend yield — % — % — % Volatility 48 % 55 % 59 % Expected life 4.3 years 4.4 years 4.5 years ESPP: Risk-free interest rate 2.16 % 1.93 % 1.09 % Dividend yield — % — % — % Volatility 50 % 53 % 58 % Expected life 6 months 6 months 6 months |
Schedule of Fair Value of Employee Share-Based Payments Awards ESPP Assumptions and Weighted Average Fair Values | The grant-date fair value of stock option grants, including PSOs, and ESPP purchases was estimated using the following assumptions: Year Ended December 31, 2019 2018 2017 Stock options, including PSOs: Risk-free interest rate 1.77 % 2.81 % 1.98 % Dividend yield — % — % — % Volatility 48 % 55 % 59 % Expected life 4.3 years 4.4 years 4.5 years ESPP: Risk-free interest rate 2.16 % 1.93 % 1.09 % Dividend yield — % — % — % Volatility 50 % 53 % 58 % Expected life 6 months 6 months 6 months |
Summary of All Stock Option Activity | Activity for stock options, including PSOs, during the year ended December 31, 2019 was as follows (in thousands , except per share amounts): Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term Aggregate Intrinsic Value Stock options outstanding at December 31, 2018 22,674 $ 8.71 Granted 1,311 $ 20.08 Exercised (3,274 ) $ 5.01 Forfeited (217 ) $ 16.89 Expired (51 ) $ 22.98 Stock options outstanding at December 31, 2019 20,443 $ 9.91 3.2 years $ 169,299 Stock options exercisable at December 31, 2019 16,216 $ 7.36 2.6 years $ 167,449 |
Summary of All RSU Activity | Activity for RSUs, including PSUs, during the year ended December 31, 2019 was as follows (in thousands , except per share amounts): Shares Weighted Average Grant Date Fair Value Weighted Average Remaining Contractual Term Aggregate Intrinsic Value RSUs outstanding at December 31, 2018 4,857 $ 18.42 Awarded 5,842 $ 19.46 Vested and released (1,541 ) $ 17.23 Forfeited (357 ) $ 18.66 RSUs outstanding at December 31, 2019 8,801 $ 19.31 2.2 years $ 149,701 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jan. 03, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | Our income before income taxes is derived solely from within the U.S. Our income tax provision (benefit) was as follows (in thousands): Year Ended December 31, 2019 2018 2017 Current: Federal $ — $ — $ — State 6,095 6,133 4,350 Total current tax expense 6,095 6,133 4,350 Deferred: Federal 71,580 (238,675 ) — State (578 ) (5,436 ) — Total deferred tax expense 71,002 (244,111 ) — Income tax provision (benefit) $ 77,097 $ (237,978 ) $ 4,350 |
Schedule of Reconciliation of Income Taxes At The Statutory Federal Income Tax Rate to Net Income Taxes | The reconciliation of the U.S. federal income tax provision (benefit) at the statutory federal income tax rates of 21% , 21% and 34% for the years ended December 31, 2019, 2018 and 2017, respectively, to our income tax provision (benefit) was as follows (in thousands): Year Ended December 31, 2019 2018 2017 U.S. federal income tax provision at statutory rate $ 83,603 $ 94,939 $ 53,916 State tax expense 1,148 4,690 8,282 Change in valuation allowance 3,208 (315,394 ) (34,266 ) Research credits (8,299 ) (18,308 ) — Stock-based compensation (9,177 ) (5,998 ) (20,548 ) Non-deductible executive compensation 4,228 1,111 1,239 Non-deductible interest — — 1,367 Other 2,386 982 (5,640 ) Income tax provision (benefit) $ 77,097 $ (237,978 ) $ 4,350 |
Schedule of Deferred Assets and Liabilities | Our deferred tax assets and liabilities were as follows (in thousands): December 31, 2019 2018 Deferred tax assets: Net operating loss carryforwards $ 65,131 $ 146,701 Tax credit carryforwards 110,037 98,467 Depreciation and amortization 26,792 29,929 Stock-based compensation 14,966 11,366 Lease liabilities 11,211 3,265 Accruals and reserves not currently deductible 8,248 7,160 Deferred revenue 6,547 5,474 Other assets 345 1,140 Total deferred tax assets 243,277 303,502 Valuation allowance (61,659 ) (58,112 ) Net deferred tax assets 181,618 245,390 Deferred tax liabilities: Lease right-of-use assets (9,244 ) (1,279 ) Total deferred tax liabilities (9,244 ) (1,279 ) Net deferred taxes $ 172,374 $ 244,111 |
Schedule of Unrecognized Tax Benefits | The following table summarizes the activity related to our unrecognized tax benefits (in thousands): Year Ended December 31, 2019 2018 2017 Beginning balance $ 76,060 $ 79,342 $ 61,809 Change relating to prior year provision 589 (4,254 ) 247 Change relating to current year provision 2,429 1,083 17,378 Reductions based on the lapse of the applicable statutes of limitations — (111 ) (92 ) Ending balance $ 79,078 $ 76,060 $ 79,342 |
Net Income Per Share (Tables)
Net Income Per Share (Tables) | 12 Months Ended |
Jan. 03, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Reconciliation of Basic and Diluted Net Loss Per Share | Net income per share - basic and diluted, were computed as follows (in thousands, except per share amounts): Year Ended December 31, 2019 2018 2017 Numerator: Net income $ 321,012 $ 690,070 $ 154,227 Net income allocated to participating securities — — (367 ) Net income allocable to common stock - basic 321,012 690,070 153,860 Adjustment to net income allocated to participating securities — — 22 Net income allocable to common stock - diluted $ 321,012 $ 690,070 $ 153,882 Denominator: Weighted-average common shares outstanding - basic 302,584 297,892 293,588 Dilutive effect of employee stock plans 12,425 14,911 18,415 Weighted-average common shares outstanding - diluted 315,009 312,803 312,003 Net income per share - basic $ 1.06 $ 2.32 $ 0.52 Net income per share - diluted $ 1.02 $ 2.21 $ 0.49 |
Schedule of Potential Shares of Common Stock Not Included In Computation of Diluted Net Loss Per Share | These potential common shares were as follows (in thousands): Year Ended December 31, 2019 2018 2017 Anti-dilutive securities and contingently issuable shares excluded 9,111 3,968 1,645 |
Commitments (Tables)
Commitments (Tables) | 12 Months Ended |
Jan. 03, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Balance Sheet Classification of Lease Liabilities | The balance sheet classification of our operating lease assets and liabilities were as follows (in thousands): December 31, 2019 2018 Assets: Right-of-use assets included in other long-term assets $ 41,835 $ 5,867 Liabilities: Current portion included in other current liabilities $ 2,728 $ 2,738 Long-term portion of operating lease liabilities 48,011 12,099 Total operating lease liabilities $ 50,739 $ 14,837 |
Components of Lease Expense | The components of operating lease costs, which are included in selling, general and administrative expenses in our Consolidated Statements of Income, were as follows (in thousands): Year Ended December 31, 2019 2018 2017 (1) Operating lease cost $ 2,844 $ 4,189 $ 3,944 Variable lease cost 1,024 1,661 2,216 Sublease income — — (1,225 ) Total operating lease costs $ 3,868 $ 5,850 $ 4,935 ____________________ (1) The 2017 amounts have not been adjusted for the adoption of Topic 842 and continue to be reported in accordance with the previous lease guidance, ASC Topic 840: Leases . |
Maturities of Operating Lease Liabilities | As of December 31, 2019 , the maturities of our operating lease liabilities were as follows (in thousands): Year Ending December 31, Amount 2020 $ 4,538 2021 4,669 2022 4,820 2023 5,147 2024 5,407 Thereafter 41,585 Total lease payments 66,166 Less: Imputed interest (13,685 ) Future tenant improvement reimbursements (1,742 ) Operating lease liabilities $ 50,739 |
Quarterly Financial Data (Una_2
Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Jan. 03, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Data | Selected unaudited quarterly financial data was as follows (in thousands, except per share data): Fiscal 2019 Quarter Ended March 31, June 30, September 30, December 31, (4) Total revenues (1) $ 215,487 $ 240,275 $ 271,703 $ 240,310 Gross profit (2) $ 172,080 $ 186,136 $ 184,231 $ 184,406 Income from operations $ 84,559 $ 91,989 $ 115,606 $ 77,316 Net income $ 75,775 $ 79,042 $ 97,452 $ 68,743 Net income per share: Basic $ 0.25 $ 0.26 $ 0.32 $ 0.23 Diluted $ 0.24 $ 0.25 $ 0.31 $ 0.22 Fiscal 2018 Quarter Ended March 31, June 30, September 30, December 31, Total revenues (1) $ 213,719 $ 186,108 $ 225,397 $ 228,602 Gross profit (2) $ 128,633 $ 139,839 $ 155,586 $ 168,873 Income from operations $ 116,307 $ 85,770 $ 125,176 $ 111,602 Net income (3) $ 115,857 $ 87,494 $ 126,630 $ 360,089 Net income per share: Basic $ 0.39 $ 0.29 $ 0.42 $ 1.20 Diluted $ 0.37 $ 0.28 $ 0.41 $ 1.15 ____________________ (1) Total revenues for the quarters ended March 31, 2019, June 30, 2019, September 30, 2019 and December 31, 2019 included $10.0 million , $20.4 million , $50.6 million and $15.1 million in milestone revenue, respectively, as compared to $66.5 million , $25.8 million , $42.6 million and $29.6 million during the comparable periods in 2018. Due to uncertainties surrounding the timing and achievement of regulatory and development milestones, it is difficult to predict future milestone revenues and such milestones can vary significantly from period to period. (2) Gross profit is computed as net product revenues less cost of goods sold. (3) Net income for the quarter ended December 31, 2018 included a $244.1 million income tax benefit related to the release of substantially all of the valuation allowance against our deferred tax assets. (4) The fiscal quarter ended December 31, 2019 is a 14-week fiscal period. All other quarters presented are 13-week fiscal periods. |
Organization and Summary of S_3
Organization and Summary of Significant Accounting Policies (Details) | 3 Months Ended | 12 Months Ended | ||||
Mar. 29, 2019 | Mar. 31, 2018 | Mar. 31, 2017 | Jan. 03, 2020USD ($)segmentproduct | Dec. 28, 2018USD ($) | Dec. 29, 2017USD ($) | |
Organization And Summary Of Significant Policies [Line Items] | ||||||
Number of operating segments | segment | 1 | |||||
Impairment charge on goodwill | $ | $ 0 | |||||
Percent discount for prompt payment | 2.00% | |||||
Discount expected to be earned | 100.00% | |||||
Medicare Part D Funding Mandate | 70.00% | 50.00% | 50.00% | |||
Materials in inventory balances | $ | $ 0 | $ 0 | ||||
Advertising expense | $ | $ 17,900,000 | $ 14,800,000 | $ 8,600,000 | |||
Maximum | ||||||
Organization And Summary Of Significant Policies [Line Items] | ||||||
Estimated useful lives | 15 years | |||||
Collaborative Arrangement with GlaxoSmithKline | ||||||
Organization And Summary Of Significant Policies [Line Items] | ||||||
Cost of goods sold is related to product | 3.00% | |||||
Resulting From Discovery Efforts | ||||||
Organization And Summary Of Significant Policies [Line Items] | ||||||
Number of products that entered in the commercial marketplace | product | 4 | |||||
Products Derived from Cabozantinib | ||||||
Organization And Summary Of Significant Policies [Line Items] | ||||||
Number of products that entered in the commercial marketplace | product | 2 | |||||
Products Derived From Other Compounds | ||||||
Organization And Summary Of Significant Policies [Line Items] | ||||||
Number of products that entered in the commercial marketplace | product | 2 |
Revenues (Revenues by Disaggreg
Revenues (Revenues by Disaggregated Category) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 03, 2020 | Sep. 27, 2019 | Jun. 28, 2019 | Mar. 29, 2019 | Dec. 28, 2018 | Sep. 29, 2018 | Jun. 29, 2018 | Mar. 31, 2018 | Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | $ 240,310 | $ 271,703 | $ 240,275 | $ 215,487 | $ 228,602 | $ 225,397 | $ 186,108 | $ 213,719 | $ 967,775 | $ 853,826 | $ 452,477 |
Gross product revenues | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | 957,621 | 738,529 | 402,569 | ||||||||
Discounts and allowances | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | (197,671) | (119,250) | (53,561) | ||||||||
Net product revenues | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | 759,950 | 619,279 | 349,008 | ||||||||
License revenues | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | 161,299 | 192,188 | 96,637 | ||||||||
Research and development service revenues | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | 49,965 | 39,501 | 8,737 | ||||||||
Other collaboration revenues | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | (3,439) | 2,858 | (1,905) | ||||||||
Total collaboration revenues | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | $ 207,825 | $ 234,547 | $ 103,469 |
Revenues (Net Product Revenues
Revenues (Net Product Revenues Disaggregated by Product) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 03, 2020 | Sep. 27, 2019 | Jun. 28, 2019 | Mar. 29, 2019 | Dec. 28, 2018 | Sep. 29, 2018 | Jun. 29, 2018 | Mar. 31, 2018 | Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Net product revenues | $ 240,310 | $ 271,703 | $ 240,275 | $ 215,487 | $ 228,602 | $ 225,397 | $ 186,108 | $ 213,719 | $ 967,775 | $ 853,826 | $ 452,477 |
CABOMETYX | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net product revenues | 733,421 | 599,946 | 324,000 | ||||||||
COMETRIQ | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net product revenues | 26,529 | 19,333 | 25,008 | ||||||||
Net product revenues | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net product revenues | $ 759,950 | $ 619,279 | $ 349,008 |
Revenues (Revenues Disaggregate
Revenues (Revenues Disaggregated by Significant Customer) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 03, 2020 | Sep. 27, 2019 | Jun. 28, 2019 | Mar. 29, 2019 | Dec. 28, 2018 | Sep. 29, 2018 | Jun. 29, 2018 | Mar. 31, 2018 | Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||||
Total revenues | $ 240,310 | $ 271,703 | $ 240,275 | $ 215,487 | $ 228,602 | $ 225,397 | $ 186,108 | $ 213,719 | $ 967,775 | $ 853,826 | $ 452,477 |
Ipsen | Sales revenue, net | Customer concentration risk | |||||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||||
Percent of total | 16.00% | 21.00% | 15.00% | ||||||||
Affiliates of CVS Health Corporation | Sales revenue, net | Customer concentration risk | |||||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||||
Percent of total | 15.00% | 13.00% | 16.00% | ||||||||
Affiliates of McKesson Corporation | Sales revenue, net | Customer concentration risk | |||||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||||
Percent of total | 12.00% | 12.00% | 11.00% | ||||||||
Affiliates of AmerisourceBergen Corporation | Sales revenue, net | Customer concentration risk | |||||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||||
Percent of total | 10.00% | 8.00% | 8.00% | ||||||||
Accredo Health, Incorporated | Sales revenue, net | Customer concentration risk | |||||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||||
Percent of total | 9.00% | 9.00% | 11.00% | ||||||||
Diplomat Specialty Pharmacy | Sales revenue, net | Customer concentration risk | |||||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||||
Percent of total | 5.00% | 9.00% | 18.00% |
Revenues (Revenues Disaggrega_2
Revenues (Revenues Disaggregated by Geographic Region) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 03, 2020 | Sep. 27, 2019 | Jun. 28, 2019 | Mar. 29, 2019 | Dec. 28, 2018 | Sep. 29, 2018 | Jun. 29, 2018 | Mar. 31, 2018 | Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | $ 240,310 | $ 271,703 | $ 240,275 | $ 215,487 | $ 228,602 | $ 225,397 | $ 186,108 | $ 213,719 | $ 967,775 | $ 853,826 | $ 452,477 |
U.S. | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | 770,244 | 632,927 | 367,906 | ||||||||
Europe | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | 152,771 | 182,879 | 69,792 | ||||||||
Japan | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | $ 44,760 | $ 38,020 | $ 14,779 |
Revenues (Activities and Ending
Revenues (Activities and Ending Reserve Balances for Significant Categories of Discounts and Allowances) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 03, 2020 | Dec. 28, 2018 | |
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | ||
Balance at beginning of period | $ 17,276 | $ 9,493 |
Provision related to sales made in: | ||
Current period | 193,791 | 119,600 |
Prior periods | 3,880 | (350) |
Payments and customer credits issued | (188,714) | (111,467) |
Balance at end of period | 26,233 | 17,276 |
Chargebacks and Discounts for Prompt Payment | ||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | ||
Balance at beginning of period | 2,322 | 1,928 |
Provision related to sales made in: | ||
Current period | 129,936 | 75,543 |
Prior periods | 3,989 | (403) |
Payments and customer credits issued | (128,733) | (74,746) |
Balance at end of period | 7,514 | 2,322 |
Other Customer Credits/Fees and Co-pay Assistance | ||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | ||
Balance at beginning of period | 3,038 | 1,795 |
Provision related to sales made in: | ||
Current period | 15,605 | 13,017 |
Prior periods | (111) | 206 |
Payments and customer credits issued | (15,035) | (11,980) |
Balance at end of period | 3,497 | 3,038 |
Rebates | ||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | ||
Balance at beginning of period | 11,916 | 5,770 |
Provision related to sales made in: | ||
Current period | 48,250 | 31,040 |
Prior periods | 2 | (153) |
Payments and customer credits issued | (44,946) | (24,741) |
Balance at end of period | $ 15,222 | $ 11,916 |
Revenues Revenues (Contract Ass
Revenues Revenues (Contract Assets and Liabilities) (Details) - USD ($) | 12 Months Ended | |
Jan. 03, 2020 | Dec. 28, 2018 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Contract assets | $ 1,100,000 | $ 0 |
Contract liabilities | 6,596,000 | 15,897,000 |
Amount of revenues recognized included in the beginning contract liability balance | 6,500,000 | 8,700,000 |
Revenues recognized for performance obligations satisfied in previous periods | 161,200,000 | $ 198,100,000 |
Transaction price allocated to our performance obligations | 63,100,000 | |
Collaborative arrangement with Takeda | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Eligible payment from collaboration for development and regulatory milestone achievement under collaborations agreement | 10,000,000 | |
Transaction price allocated to our performance obligations | $ 18,100,000 |
Collaboration Agreements (Ipsen
Collaboration Agreements (Ipsen Collaboration, Narrative) (Details) | 3 Months Ended | 12 Months Ended | |||||||||||
Jan. 03, 2020USD ($) | Sep. 27, 2019USD ($) | Jun. 28, 2019USD ($) | Mar. 29, 2019USD ($) | Dec. 28, 2018USD ($) | Sep. 29, 2018USD ($) | Jun. 29, 2018USD ($) | Mar. 31, 2018USD ($) | Jan. 03, 2020USD ($) | Jan. 03, 2020CAD ($) | Dec. 28, 2018USD ($) | Dec. 29, 2017USD ($) | Dec. 30, 2016USD ($) | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Milestone payments earned | $ 15,100,000 | $ 50,600,000 | $ 20,400,000 | $ 10,000,000 | $ 29,600,000 | $ 42,600,000 | $ 25,800,000 | $ 66,500,000 | |||||
Remaining performance obligation | 63,100,000 | $ 63,100,000 | |||||||||||
Collaborative Arrangement with GlaxoSmithKline | |||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Collaboration agreement percent of royalty on net sale | 3.00% | 3.00% | |||||||||||
Collaborative arrangement with Ipsen | |||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Collaboration period to achieve specified levels of commercial performance | 10 years | 10 years | |||||||||||
Upfront payments | $ 210,000,000 | ||||||||||||
Milestone payments earned to date | 330,000,000 | $ 330,000,000 | |||||||||||
Milestone payments earned | 55,000,000 | $ 140,000,000 | |||||||||||
Eligible payment from collaboration for development and regulatory milestone achievement under collaborations agreement | 79,000,000 | 79,000,000 | |||||||||||
Maximum amount eligible for commercial milestones under collaborations agreement | 470,400,000 | $ 470,400,000 | |||||||||||
Research and development arrangement performed for others, reimbursement for costs incurred, percent | 35.00% | 35.00% | |||||||||||
Net contract liability | 152,800,000 | 182,900,000 | $ 152,800,000 | 182,900,000 | $ 69,800,000 | ||||||||
Remaining performance obligation | 45,000,000 | $ 45,000,000 | |||||||||||
Collaborative arrangement with Ipsen | Final tier | |||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Royalty tier | $ 30,000,000 | ||||||||||||
Collaborative arrangement with Ipsen | Minimum | Final tier | |||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Percent of royalty on net sale | 22.00% | 22.00% | |||||||||||
Collaborative arrangement with Ipsen | Maximum | Final tier | |||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Percent of royalty on net sale | 26.00% | 26.00% | |||||||||||
Collaborative arrangement with Takeda | |||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Upfront payments | 50,000,000 | ||||||||||||
Milestone payments earned to date | 26,000,000 | $ 26,000,000 | |||||||||||
Milestone payments earned | 16,000,000 | 10,000,000 | |||||||||||
Eligible payment from collaboration for development and regulatory milestone achievement under collaborations agreement | 10,000,000 | 10,000,000 | |||||||||||
Maximum amount eligible for commercial milestones under collaborations agreement | 155,000,000 | 155,000,000 | |||||||||||
Net contract liability | 24,600,000 | $ 18,000,000 | 24,600,000 | $ 18,000,000 | $ 14,800,000 | ||||||||
Remaining performance obligation | $ 18,100,000 | 18,100,000 | |||||||||||
Collaborative arrangement with Takeda | Initial | |||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Royalty tier | $ 300,000,000 | ||||||||||||
Collaborative arrangement with Takeda | Minimum | Final tier | |||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Percent of royalty on net sale | 20.00% | 20.00% | |||||||||||
Collaborative arrangement with Takeda | Minimum | Initial | |||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Percent of royalty on net sale | 15.00% | 15.00% | |||||||||||
Collaborative arrangement with Takeda | Maximum | Final tier | |||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Percent of royalty on net sale | 30.00% | 30.00% | |||||||||||
Collaborative arrangement with Takeda | Maximum | Initial | |||||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||||
Percent of royalty on net sale | 24.00% | 24.00% |
Collaboration Agreements (Taked
Collaboration Agreements (Takeda Collaboration, Narrative) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 03, 2020 | Sep. 27, 2019 | Jun. 28, 2019 | Mar. 29, 2019 | Dec. 28, 2018 | Sep. 29, 2018 | Jun. 29, 2018 | Mar. 31, 2018 | Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Milestone payments earned | $ 15,100,000 | $ 50,600,000 | $ 20,400,000 | $ 10,000,000 | $ 29,600,000 | $ 42,600,000 | $ 25,800,000 | $ 66,500,000 | |||
Remaining performance obligation | 63,100,000 | $ 63,100,000 | |||||||||
Collaborative arrangement with Takeda | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Sales volume period | 6 years | ||||||||||
Upfront payments | $ 50,000,000 | ||||||||||
Milestone payments earned to date | 26,000,000 | $ 26,000,000 | |||||||||
Milestone payments earned | 16,000,000 | $ 10,000,000 | |||||||||
Eligible payment from collaboration for development and regulatory milestone achievement under collaborations agreement | 10,000,000 | 10,000,000 | |||||||||
Maximum amount eligible for development and regulatory milestones | 20,000,000 | 20,000,000 | |||||||||
Maximum amount eligible for commercial milestones under collaborations agreement | 155,000,000 | 155,000,000 | |||||||||
Net contract liability | 24,600,000 | $ 18,000,000 | 24,600,000 | $ 18,000,000 | $ 14,800,000 | ||||||
Remaining performance obligation | $ 18,100,000 | $ 18,100,000 | |||||||||
Collaborative arrangement with Takeda | Global | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Research and development arrangement performed for others, reimbursement for costs incurred, percent | 20.00% | ||||||||||
Collaborative arrangement with Takeda | Japan | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Collaboration period to achieve specified levels of commercial performance | 2 years | ||||||||||
Research and development arrangement performed for others, reimbursement for costs incurred, percent | 100.00% | ||||||||||
Collaborative arrangement with Takeda | Initial | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Royalty tier | $ 300,000,000 | ||||||||||
Collaborative arrangement with Takeda | Minimum | Initial | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Percent of royalty on net sale | 15.00% | ||||||||||
Collaborative arrangement with Takeda | Minimum | Final tier | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Percent of royalty on net sale | 20.00% | ||||||||||
Collaborative arrangement with Takeda | Maximum | Initial | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Percent of royalty on net sale | 24.00% | ||||||||||
Collaborative arrangement with Takeda | Maximum | Final tier | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Percent of royalty on net sale | 30.00% | ||||||||||
ASU 2014-09 | Adjustments Due to the Adoption of Topic 606 | EMA Filing Acceptance - HCC | Collaborative arrangement with Takeda | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Milestone payments earned | $ 10,000,000 |
Collaboration Agreements (Royal
Collaboration Agreements (Royalty Revenues under the Collaboration Agreement with GSK) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Collaborative Arrangements with Glaxo Smith Kline | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Royalty expense | $ 31.3 | $ 24 | $ 12.4 |
Collaborative Arrangement with GlaxoSmithKline | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Collaboration agreement percent of royalty on net sale | 3.00% |
Collaboration Agreements Collab
Collaboration Agreements Collaboration Agreements (In-Licensing Collaborations) (Details) $ in Millions | 1 Months Ended | ||
Jul. 31, 2019USD ($)program | May 31, 2019USD ($) | Jan. 03, 2020USD ($) | |
Collaboration Agreement With Aurigene Discovery Technologies Limited Collaboration Agreement | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Collaboration agreement, number of programs | program | 6 | ||
Upfront payments | $ 17.5 | ||
Collaboration agreement pre-existing programs | program | 3 | ||
Preclinical development work on these programs | $ 32.6 | ||
Expense for the discovery and preclinical development funding commitment | $ 4 | ||
Maximum amount eligible for development and regulatory milestones | 148.8 | ||
Potential development and regulatory milestone payments | 280 | ||
Collaboration Agreement With Iconic Therapeutics, Inc. | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Expense for the discovery and preclinical development funding commitment | 9.8 | ||
Collaboration agreement option exercise fee payment, upon exercising option | 20 | ||
Maximum amount eligible for development and regulatory milestones | 190.6 | ||
Potential development and regulatory milestone payments | $ 262.5 | ||
Upfront payment | $ 7.5 | ||
Minimum | Collaboration Agreement With Aurigene Discovery Technologies Limited Collaboration Agreement | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Collaboration agreement option exercise fee payment, upon exercising option | 10 | ||
Maximum | Collaboration Agreement With Aurigene Discovery Technologies Limited Collaboration Agreement | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Collaboration agreement option exercise fee payment, upon exercising option | $ 12 |
Collaboration Agreements (Inven
Collaboration Agreements (Invenra Collaboration, Narrative) (Details) - Collaborative Arrangement With Invenra - USD ($) $ in Millions | 12 Months Ended | |
Jan. 03, 2020 | Dec. 28, 2018 | |
Discovery Project | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Project initiation fee | $ 7 | $ 4 |
Upfront and milestone payments | 2 | |
Development and Regulatory Milestone | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Eligible payment from collaboration for development and regulatory milestone achievement under collaborations agreement | 131.5 | |
Additional Development and Regulatory Milestone | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Project initiation fee | 43.4 | |
Upfront and milestone payments | 1.5 | |
Product Commercialization | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Eligible payment from collaboration for development and regulatory milestone achievement under collaborations agreement | $ 325 |
Collaboration Agreements (StemS
Collaboration Agreements (StemSynergy Collaboration, Narrative) (Details) - Collaborative Arrangement With StemSynergy - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 03, 2020 | Dec. 28, 2018 | Jan. 31, 2018 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Upfront and milestone payments | $ 3 | ||
Additional upfront and milestone payments | $ 1.9 | $ 1.2 | |
Eligible payment from collaboration for development and regulatory milestone achievement under collaborations agreement | $ 0.5 | ||
First Product To Reach Market | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Eligible payment from collaboration for development and regulatory milestone achievement under collaborations agreement | $ 56.5 |
Collaboration Agreements (Colla
Collaboration Agreements (Collaboration Revenues - Genentech) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 03, 2020 | Sep. 27, 2019 | Jun. 28, 2019 | Mar. 29, 2019 | Dec. 28, 2018 | Sep. 29, 2018 | Jun. 29, 2018 | Mar. 31, 2018 | Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Total revenues | $ 240,310 | $ 271,703 | $ 240,275 | $ 215,487 | $ 228,602 | $ 225,397 | $ 186,108 | $ 213,719 | $ 967,775 | $ 853,826 | $ 452,477 |
Collaborative Arrangement with Genentech | Cotellic | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Collaborative Arrangement, Income (Loss) From Agreement | 4,615 | 8,084 | (2,140) | ||||||||
Total revenues | $ 5,679 | $ 5,564 | $ 6,398 |
Collaboration Agreements (Other
Collaboration Agreements (Other Collaborations, Narrative) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 03, 2020 | Sep. 27, 2019 | Jun. 28, 2019 | Mar. 29, 2019 | Dec. 28, 2018 | Sep. 29, 2018 | Jun. 29, 2018 | Mar. 31, 2018 | Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Revenues | $ 240,310,000 | $ 271,703,000 | $ 240,275,000 | $ 215,487,000 | $ 228,602,000 | $ 225,397,000 | $ 186,108,000 | $ 213,719,000 | $ 967,775,000 | $ 853,826,000 | $ 452,477,000 |
Collaborative Arrangement with Daiichi Sankyo | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Achieved milestone amount | 20,000,000 | 20,000,000 | |||||||||
Maximum amount eligible for development and regulatory milestones | $ 90,000,000 | $ 90,000,000 | |||||||||
Termination period | 90 days | ||||||||||
Collaboration Agreement with Daiichi Sankyo | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Collaboration agreement percent of royalty on net sale | 0.50% | ||||||||||
Revenues | $ 20,100,000 | $ 20,000,000 | $ 0 | ||||||||
Profit Sharing Tier One | Collaborative Arrangement with Genentech | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Percent of profits | 50.00% | ||||||||||
Profit Sharing Tier Two | Collaborative Arrangement with Genentech | Minimum | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Profit threshold | $ 200,000,000 | ||||||||||
Profit Sharing Tier Three | Collaborative Arrangement with Genentech | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Percent of profits | 30.00% | ||||||||||
Profit Sharing Tier Three | Collaborative Arrangement with Genentech | Maximum | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Profit threshold | $ 400,000,000 | ||||||||||
MINNEBRO | Collaborative Arrangement with Daiichi Sankyo | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Revenues | $ 100,000 |
Cash and Investments (Reconcili
Cash and Investments (Reconciliation of Cash, Cash Equivalents, and Restricted Cash) (Details) - USD ($) $ in Thousands | Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | Dec. 30, 2016 |
Investments, Debt and Equity Securities [Abstract] | ||||
Cash and cash equivalents | $ 266,501 | $ 314,775 | $ 183,164 | |
Short-term restricted cash equivalents | 0 | 0 | 504 | |
Restricted cash equivalents included in long-term investments | 1,636 | 1,100 | 4,646 | |
Amortized Cost | $ 268,137 | $ 315,875 | $ 188,314 | $ 155,836 |
Cash and Investments (Summary b
Cash and Investments (Summary by Security Type) (Details) - USD ($) $ in Thousands | Jan. 03, 2020 | Dec. 28, 2018 |
Investment securities available-for-sale: | ||
Amortized Cost | $ 1,308,351 | $ 781,099 |
Gross Unrealized Gains | 4,121 | 182 |
Gross Unrealized Losses | (8) | (883) |
Fair Value | 1,312,464 | 780,398 |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | ||
Total, Amortized Cost | 1,384,510 | 852,322 |
Cash, Cash Equivalents, Restricted Cash And Restricted Cash Equivalents And Available For Sale Debt Securities, Accumulated Gross Unrealized Gain, Before Tax | 4,126 | |
Cash, Cash Equivalents, Restricted Cash And Restricted Cash Equivalents And Available For Sale, Debt Securities, Accumulated Gross Unrealized Loss, Before Tax | (8) | |
Total, Fair Value | 1,388,628 | 851,621 |
Commercial paper | ||
Investment securities available-for-sale: | ||
Amortized Cost | 389,573 | 381,134 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | (1) |
Fair Value | 389,573 | 381,133 |
Corporate bonds | ||
Investment securities available-for-sale: | ||
Amortized Cost | 752,295 | 344,741 |
Gross Unrealized Gains | 3,934 | 180 |
Gross Unrealized Losses | (3) | (857) |
Fair Value | 756,226 | 344,064 |
U.S. Treasury and government sponsored enterprises | ||
Investment securities available-for-sale: | ||
Amortized Cost | 166,483 | 55,224 |
Gross Unrealized Gains | 187 | 2 |
Gross Unrealized Losses | (5) | (25) |
Fair Value | 166,665 | 55,201 |
Cash | ||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | ||
Amortized Cost | 40,964 | 6,883 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 40,964 | 6,883 |
Money market funds | ||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | ||
Amortized Cost | 2,467 | 47,744 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 2,467 | 47,744 |
Certificates of deposit | ||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | ||
Amortized Cost | 32,728 | 16,596 |
Gross Unrealized Gains | 5 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | $ 32,733 | $ 16,596 |
Cash and Investments (Gross Unr
Cash and Investments (Gross Unrealized Losses) (Details) - USD ($) $ in Thousands | Jan. 03, 2020 | Dec. 28, 2018 |
Debt Securities, Available-for-sale [Line Items] | ||
In an Unrealized Loss Position Less than 12 Months, Fair Value | $ 17,377 | $ 271,358 |
In an Unrealized Loss Position 12 Months or Greater, Fair Value | 0 | 48,809 |
Total, Fair Value | 17,377 | 320,167 |
Gross Unrealized Losses | ||
In an Unrealized Loss Position Less than 12 Months, Gross Unrealized Losses | (8) | (623) |
In an Unrealized Loss Position 12 Months or Greater, Gross Unrealized Losses | 0 | (260) |
Total, Gross Unrealized Losses | (8) | (883) |
Corporate bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
In an Unrealized Loss Position Less than 12 Months, Fair Value | 14,529 | 236,162 |
In an Unrealized Loss Position 12 Months or Greater, Fair Value | 0 | 39,627 |
Total, Fair Value | 14,529 | 275,789 |
Gross Unrealized Losses | ||
In an Unrealized Loss Position Less than 12 Months, Gross Unrealized Losses | (3) | (606) |
In an Unrealized Loss Position 12 Months or Greater, Gross Unrealized Losses | 0 | (251) |
Total, Gross Unrealized Losses | (3) | (857) |
U.S. Treasury and government sponsored enterprises | ||
Debt Securities, Available-for-sale [Line Items] | ||
In an Unrealized Loss Position Less than 12 Months, Fair Value | 2,848 | 28,105 |
In an Unrealized Loss Position 12 Months or Greater, Fair Value | 0 | 9,182 |
Total, Fair Value | 2,848 | 37,287 |
Gross Unrealized Losses | ||
In an Unrealized Loss Position Less than 12 Months, Gross Unrealized Losses | (5) | (16) |
In an Unrealized Loss Position 12 Months or Greater, Gross Unrealized Losses | 0 | (9) |
Total, Gross Unrealized Losses | $ (5) | (25) |
Commercial paper | ||
Debt Securities, Available-for-sale [Line Items] | ||
In an Unrealized Loss Position Less than 12 Months, Fair Value | 7,091 | |
In an Unrealized Loss Position 12 Months or Greater, Fair Value | 0 | |
Total, Fair Value | 7,091 | |
Gross Unrealized Losses | ||
In an Unrealized Loss Position Less than 12 Months, Gross Unrealized Losses | (1) | |
In an Unrealized Loss Position 12 Months or Greater, Gross Unrealized Losses | 0 | |
Total, Gross Unrealized Losses | $ (1) |
Cash and Investments (Narrative
Cash and Investments (Narrative) (Details) | 12 Months Ended | ||
Jan. 03, 2020USD ($)investment | Dec. 28, 2018USD ($)investment | Dec. 29, 2017USD ($) | |
Investments, Debt and Equity Securities [Abstract] | |||
Number of investments in an unrealized loss position | investment | 9 | 199 | |
Other-than-temporary impairment charges on available-for-sale securities | $ | $ 0 | $ 0 | $ 0 |
Cash and Investments (Summary_2
Cash and Investments (Summary by Contractual Maturity) (Details) - USD ($) $ in Thousands | Jan. 03, 2020 | Dec. 28, 2018 |
Investments, Debt and Equity Securities [Abstract] | ||
Maturing in one year or less | $ 789,913 | $ 626,711 |
Maturing after one year through five years | 522,551 | 153,687 |
Total investment securities available-for-sale | $ 1,312,464 | $ 780,398 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Jan. 03, 2020 | Dec. 28, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total investment securities available-for-sale | $ 1,312,464 | $ 780,398 |
Total financial assets carried at fair value | 1,347,664 | 844,738 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total investment securities available-for-sale | 0 | 0 |
Total financial assets carried at fair value | 2,467 | 47,744 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total investment securities available-for-sale | 1,312,464 | 780,398 |
Total financial assets carried at fair value | 1,345,197 | 796,994 |
Commercial paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total investment securities available-for-sale | 389,573 | 381,133 |
Commercial paper | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total investment securities available-for-sale | 0 | 0 |
Commercial paper | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total investment securities available-for-sale | 389,573 | 381,133 |
Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total investment securities available-for-sale | 756,226 | 344,064 |
Corporate bonds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total investment securities available-for-sale | 0 | 0 |
Corporate bonds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total investment securities available-for-sale | 756,226 | 344,064 |
U.S. Treasury and government sponsored enterprises | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total investment securities available-for-sale | 166,665 | 55,201 |
U.S. Treasury and government sponsored enterprises | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total investment securities available-for-sale | 0 | 0 |
U.S. Treasury and government sponsored enterprises | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total investment securities available-for-sale | 166,665 | 55,201 |
Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | 2,467 | 47,744 |
Money market funds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | 2,467 | 47,744 |
Money market funds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | 0 | 0 |
Certificates of deposit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | 32,733 | 16,596 |
Certificates of deposit | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | 0 | 0 |
Certificates of deposit | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | $ 32,733 | $ 16,596 |
Inventory (Details)
Inventory (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Inventory [Line Items] | |||
Raw materials | $ 2,709 | $ 1,922 | |
Work in process | 9,447 | 6,170 | |
Finished goods | 4,367 | 3,836 | |
Total | 16,523 | 11,928 | |
Inventory write-down | 1,300 | 1,100 | $ 1,200 |
Current portion included in inventory | |||
Inventory [Line Items] | |||
Total | 12,886 | 9,838 | |
Long-term portion included in other long-term assets | |||
Inventory [Line Items] | |||
Total | $ 3,637 | $ 2,090 |
Property and Equipment (Schedul
Property and Equipment (Schedule of Property and Equipment) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 03, 2020 | Dec. 28, 2018 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 74,452 | $ 68,206 |
Less: accumulated depreciation and amortization | (25,560) | (17,309) |
Property and equipment, net | 48,892 | 50,897 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 33,904 | 33,941 |
Computer equipment and software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 17,338 | 15,022 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 13,053 | 12,709 |
Laboratory equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 8,904 | 5,668 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 1,253 | $ 866 |
Minimum | Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 5 years | |
Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 15 years | |
Maximum | Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 15 years | |
Maximum | Computer equipment and software | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 3 years | |
Maximum | Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 7 years | |
Maximum | Laboratory equipment | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 5 years |
Property and Equipment (Narrati
Property and Equipment (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation and amortization expenses | $ 8.3 | $ 4.9 | $ 1.2 |
Employee Benefit Plans (Schedul
Employee Benefit Plans (Schedule of Allocated Employee Stock-Based Compensation Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Total stock-based compensation | $ 56,602 | $ 40,626 | $ 23,938 |
Research and development | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Total stock-based compensation | 19,374 | 13,115 | 7,569 |
Selling, general and administrative | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Total stock-based compensation | $ 37,228 | $ 27,511 | $ 16,369 |
Employee Benefit Plans (Narrati
Employee Benefit Plans (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||||||
Jan. 03, 2020 | Dec. 28, 2018 | Dec. 28, 2018 | Dec. 29, 2017 | Dec. 31, 2010 | Jun. 28, 2019 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of shares available for grant | 6,258,319 | ||||||
Stock-based compensation expense | $ 56,602 | $ 40,626 | $ 23,938 | ||||
Stock options granted (in shares) | 1,311,000 | ||||||
Expenses relating to stock match | $ 4,600 | 3,600 | 1,700 | ||||
Stock Options | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock options, vesting period | 4 years | 10 years | |||||
Life of stock options granted | 7 years | ||||||
Total unrecognized compensation expense | $ 33,700 | ||||||
Unrecognized compensation expense weighted-average period for recognition | 2 years 2 months 12 days | ||||||
Intrinsic value of options exercised | $ 54,100 | 39,100 | 85,200 | ||||
Cash received from option exercises and purchases under the ESPP | 16,400 | 12,100 | 17,600 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | 23,400 | $ 18,900 | 13,100 | ||||
Performance Shares | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock-based compensation expense | $ 4,900 | ||||||
Instruments awarded (in shares) | 1,926,605 | 693,131 | |||||
RSUs | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock options, vesting period | 4 years | ||||||
Total unrecognized compensation expense | $ 158,000 | ||||||
Unrecognized compensation expense weighted-average period for recognition | 2 years 8 months 12 days | ||||||
Instruments awarded (in shares) | 5,842,000 | ||||||
Number of awards (in shares) | 8,801,000 | 4,857,000 | 4,857,000 | ||||
ESPP | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of shares available for grant | 4,238,999 | ||||||
Discount rate from market value on purchase date (as a percent) | 85.00% | ||||||
Discount rate from market value on offering date (as a percent) | 85.00% | ||||||
Purchase period | 6 months | ||||||
Stock-based compensation expense | $ 2,200 | $ 2,200 | $ 1,600 | ||||
Common stock issued (in shares) | 483,009 | 330,492 | 434,523 | ||||
Average price per share (in dollars per share) | $ 12.60 | $ 15.74 | $ 15.74 | $ 11.20 | |||
Proceeds from employee stock purchase plan | $ 6,100 | $ 5,200 | $ 4,900 | ||||
Performance Share Options (PSO) | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock options granted (in shares) | 308,365 | ||||||
Exercise threshold, percentage of per share exercise price of the PSO | 125.00% | ||||||
Performance Shares, Achieved Before December 31, 2020 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Employees percentage | 150.00% | ||||||
Additional shares to be earned (in shares) | 963,136 | ||||||
Performance Shares, Second Product Approval | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Employees percentage | 200.00% | ||||||
Additional shares to be earned (in shares) | 1,926,605 | ||||||
Achieved | Performance Shares | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of awards (in shares) | 281,238 | ||||||
Vested | Performance Shares | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of awards (in shares) | 141,004 | ||||||
Probable | Performance Shares | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Total unrecognized compensation expense | $ 2,100 | ||||||
Number of awards (in shares) | 99,281 | ||||||
Not Probable | Performance Shares | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Total unrecognized compensation expense | $ 80,200 |
Employee Benefit Plans (Weighte
Employee Benefit Plans (Weighted Average Grant Date Fair Value) (Details) - $ / shares | 12 Months Ended | ||
Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted average grant-date fair value (in dollars per share) | $ 8.19 | $ 9.07 | $ 11.42 |
ESPP | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted average grant-date fair value (in dollars per share) | $ 4.85 | $ 6.40 | $ 6 |
Employee Benefit Plans (Sched_2
Employee Benefit Plans (Schedule of Fair Value of Employee Share-Based Payments Awards ESPP Assumptions and Weighted Average Fair Values) (Details) | 12 Months Ended | ||
Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free interest rate | 1.77% | 2.81% | 1.98% |
Dividend yield | 0.00% | 0.00% | 0.00% |
Volatility | 48.00% | 55.00% | 59.00% |
Expected life | 4 years 3 months 18 days | 4 years 4 months 24 days | 4 years 6 months |
ESPP | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free interest rate | 2.16% | 1.93% | 1.09% |
Dividend yield | 0.00% | 0.00% | 0.00% |
Volatility | 50.00% | 53.00% | 58.00% |
Expected life | 6 months | 6 months | 6 months |
Employee Benefit Plans (Summary
Employee Benefit Plans (Summary of All Stock Option Activity) (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended |
Jan. 03, 2020USD ($)$ / sharesshares | |
Shares | |
Options outstanding at beginning of the year (in shares) | shares | 22,674 |
Granted (in shares) | shares | 1,311 |
Exercised (in shares) | shares | (3,274) |
Forfeited (in shares) | shares | (217) |
Expired (in shares) | shares | (51) |
Options outstanding at ending of the year (in shares) | shares | 20,443 |
Exercisable at end of the year (in shares) | shares | 16,216 |
Weighted Average Exercise Price | |
Options outstanding at beginning of the year (in dollars per share) | $ / shares | $ 8.71 |
Granted (in dollars per share) | $ / shares | 20.08 |
Exercised (in dollars per share) | $ / shares | 5.01 |
Forfeited (in dollars per share) | $ / shares | 16.89 |
Expired (in dollars per share) | $ / shares | 22.98 |
Options outstanding at ending of the year (in dollars per share) | $ / shares | 9.91 |
Exercisable at end of the year (in dollars per share) | $ / shares | $ 7.36 |
Weighted Average Remaining Contractual Term, Options outstanding at end of the year | 3 years 2 months 12 days |
Weighted Average Remaining Contractual Term, Exercisable at end of the year | 2 years 7 months 6 days |
Aggregate Intrinsic Value, Options outstanding at end of the year | $ | $ 169,299 |
Aggregate Intrinsic Value, Exercisable at end of the year | $ | $ 167,449 |
Employee Benefit Plans (Summa_2
Employee Benefit Plans (Summary of All RSU Activity) (Details) - RSUs $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended |
Jan. 03, 2020USD ($)$ / sharesshares | |
Shares | |
Awards outstanding at beginning of period (in shares) | shares | 4,857 |
Awarded (in shares) | shares | 5,842 |
Vested and released (in shares) | shares | (1,541) |
Forfeited (in shares) | shares | (357) |
Awards outstanding at end of period (in shares) | shares | 8,801 |
Weighted Average Grant Date Fair Value | |
Awards outstanding at beginning of period (in dollars per share) | $ / shares | $ 18.42 |
Awarded (in dollars per share) | $ / shares | 19.46 |
Vested and released (in dollars per share) | $ / shares | 17.23 |
Forfeited (in dollars per share) | $ / shares | 18.66 |
Awards outstanding at end of period (in dollars per share) | $ / shares | $ 19.31 |
Weighted Average Remaining Contractual Term, Awards outstanding at end of the year | 2 years 2 months 12 days |
Aggregate Intrinsic Value, Awards outstanding at end of the year | $ | $ 149,701 |
Income Taxes (Components of Inc
Income Taxes (Components of Income Tax Expense (Benefit)) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Current: | |||
Federal | $ 0 | $ 0 | $ 0 |
State | 6,095 | 6,133 | 4,350 |
Total current tax expense | 6,095 | 6,133 | 4,350 |
Deferred: | |||
Federal | 71,580 | (238,675) | 0 |
State | (578) | (5,436) | 0 |
Total deferred tax expense | 71,002 | (244,111) | 0 |
Income tax provision (benefit) | $ 77,097 | $ (237,978) | $ 4,350 |
Income Taxes (Schedule of Recon
Income Taxes (Schedule of Reconciliation of Income Taxes at the Statutory Federal Income Tax Rate to Net Income Taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Income Tax Disclosure [Abstract] | |||
Federal income tax rate | 21.00% | 21.00% | 34.00% |
U.S. federal income tax provision at statutory rate | $ 83,603 | $ 94,939 | $ 53,916 |
State tax expense | 1,148 | 4,690 | 8,282 |
Change in valuation allowance | 3,208 | (315,394) | (34,266) |
Research credits | (8,299) | (18,308) | 0 |
Stock-based compensation | (9,177) | (5,998) | (20,548) |
Non-deductible executive compensation | 4,228 | 1,111 | 1,239 |
Non-deductible interest | 0 | 0 | 1,367 |
Other | 2,386 | 982 | (5,640) |
Income tax provision (benefit) | $ 77,097 | $ (237,978) | $ 4,350 |
Income Taxes (Schedule of Defer
Income Taxes (Schedule of Deferred Assets and Liabilities) (Details) - USD ($) $ in Thousands | Jan. 03, 2020 | Dec. 28, 2018 |
Deferred tax assets: | ||
Net operating loss carryforwards | $ 65,131 | $ 146,701 |
Tax credit carryforwards | 110,037 | 98,467 |
Depreciation and amortization | 26,792 | 29,929 |
Stock-based compensation | 14,966 | 11,366 |
Lease liabilities | 11,211 | 3,265 |
Accruals and reserves not currently deductible | 8,248 | 7,160 |
Deferred revenue | 6,547 | 5,474 |
Other assets | 345 | 1,140 |
Total deferred tax assets | 243,277 | 303,502 |
Valuation allowance | (61,659) | (58,112) |
Net deferred tax assets | 181,618 | 245,390 |
Deferred tax liabilities: | ||
Lease right-of-use assets | (9,244) | (1,279) |
Total deferred tax liabilities | (9,244) | (1,279) |
Net deferred taxes | $ 172,374 | $ 244,111 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Dec. 28, 2018 | Jan. 03, 2020 | Dec. 28, 2018 | Dec. 31, 2017 | Dec. 30, 2016 | |
Income Tax Examination [Line Items] | |||||
Valuation allowance | $ 58,112 | $ 61,659 | $ 58,112 | ||
Valuation allowance increase (decrease) | 244,100 | 3,500 | (360,800) | ||
Unrecognized tax benefits | $ 76,060 | 79,078 | $ 76,060 | $ 79,342 | $ 61,809 |
Unrecognized tax benefits that would reduce income tax provision and effective tax rate | 48,100 | ||||
Federal | |||||
Income Tax Examination [Line Items] | |||||
Net operating loss carryforwards | 225,000 | ||||
Operating loss carryforwards with expiration dates | 203,000 | ||||
Research and development tax credits | 112,000 | ||||
State and Local Jurisdiction | |||||
Income Tax Examination [Line Items] | |||||
Net operating loss carryforwards | 450,000 | ||||
State and Local Jurisdiction | Research Tax Credit Carryforward | |||||
Income Tax Examination [Line Items] | |||||
Research and development tax credits | $ 38,000 |
Income Taxes (Schedule of Unrec
Income Taxes (Schedule of Unrecognized Tax Benefits) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Mar. 30, 2018 | Sep. 30, 2017 | Jan. 03, 2020 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Beginning balance | $ 76,060 | ||
Change relating to prior year provision | $ (4,254) | $ 247 | 589 |
Change relating to current year provision | 1,083 | 17,378 | 2,429 |
Reductions based on the lapse of the applicable statutes of limitations | $ (111) | $ (92) | 0 |
Ending balance | $ 79,078 |
Net Income Per Share (Computati
Net Income Per Share (Computation of Basic and Diluted Net Income Per Share) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 03, 2020 | Sep. 27, 2019 | Jun. 28, 2019 | Mar. 29, 2019 | Dec. 28, 2018 | Sep. 29, 2018 | Jun. 29, 2018 | Mar. 31, 2018 | Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Numerator: | |||||||||||
Net income | $ 68,743 | $ 97,452 | $ 79,042 | $ 75,775 | $ 360,089 | $ 126,630 | $ 87,494 | $ 115,857 | $ 321,012 | $ 690,070 | $ 154,227 |
Net income allocated to participating securities | 0 | 0 | (367) | ||||||||
Net income allocable to common stock - basic | 321,012 | 690,070 | 153,860 | ||||||||
Adjustment to net income allocated to participating securities | 0 | 0 | 22 | ||||||||
Net income allocable to common stock - diluted | $ 321,012 | $ 690,070 | $ 153,882 | ||||||||
Denominator: | |||||||||||
Weighted-average shares of common stock outstanding used in computing basic net income (loss) per share (in shares) | 302,584 | 297,892 | 293,588 | ||||||||
Outstanding stock options, unvested RSUs and ESPP contributions (in shares) | 12,425 | 14,911 | 18,415 | ||||||||
Weighted-average shares of common stock outstanding and dilutive securities used in computing diluted net income (loss) per share (in shares) | 315,009 | 312,803 | 312,003 | ||||||||
Net income (loss) per share, basic (in dollars per share) | $ 0.23 | $ 0.32 | $ 0.26 | $ 0.25 | $ 1.20 | $ 0.42 | $ 0.29 | $ 0.39 | $ 1.06 | $ 2.32 | $ 0.52 |
Net income (loss) per share, diluted (in dollars per share) | $ 0.22 | $ 0.31 | $ 0.25 | $ 0.24 | $ 1.15 | $ 0.41 | $ 0.28 | $ 0.37 | $ 1.02 | $ 2.21 | $ 0.49 |
Net Income Per Share (Potential
Net Income Per Share (Potentially Dilutive Shares of Common Stock) (Details) - shares shares in Thousands | 12 Months Ended | ||
Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Outstanding stock options, unvested RSUs and ESPP contributions | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities and contingently issuable shares excluded | 9,111 | 3,968 | 1,645 |
Net Income Per Share (Narrative
Net Income Per Share (Narrative) (Details) shares in Millions | Jan. 31, 2014shares |
2014 Warrants | |
Class of Warrant or Right [Line Items] | |
Warrants outstanding (in shares) | 1 |
Commitments (Narrative) (Detail
Commitments (Narrative) (Details) | 1 Months Ended | 12 Months Ended | ||||
Oct. 31, 2019USD ($)ft²renewal_option$ / ft² | Jan. 03, 2020USD ($)ft²renewal_option | Aug. 30, 2019ft² | Apr. 30, 2019USD ($) | Jan. 31, 2019USD ($) | Dec. 28, 2018USD ($) | |
Lessee, Lease, Description [Line Items] | ||||||
Weighted average remaining lease term for operating lease | 11 years 9 months 18 days | |||||
Future tenant improvement reimbursements | $ 1,742,000 | |||||
Cash paid for amounts included in the measurement of lease liabilities | $ 2,900,000 | |||||
Weighted average operating discount rate used to determine the operating lease liability | 3.90% | |||||
Standby Letters of Credit | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Line of credit borrowing capacity | $ 1,600,000 | $ 1,100,000 | ||||
Letters of credit outstanding | $ 0 | |||||
Headquarters Lease | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Area of leased property (in sqft) | ft² | 221,464 | 228,941 | ||||
Number of options to extend the lease | renewal_option | 2 | |||||
Renewal term | 5 years | |||||
Tenant lease improvements allowance | $ 1,700,000 | $ 8,200,000 | ||||
Built-To-Suit Lease | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Area of leased property (in sqft) | ft² | 220,000 | |||||
Number of options to extend the lease | renewal_option | 2 | |||||
Renewal term | 5 years | |||||
Future tenant improvement reimbursements | $ 16,500,000 | |||||
Build-to-suit lease period | 242 months | |||||
Currently estimated amount | $ 700,000 | |||||
Annual increase percentage | 3.00% | |||||
Payment commencement period | 60 days | |||||
Area of property available for lease (in squire feet) | $ / ft² | 525 | |||||
Percentage of excess costs | 50.00% | |||||
Option to terminate lease (after period) | 180 months |
Commitments (Balance Sheet Clas
Commitments (Balance Sheet Classification of Lease Liabilities) (Details) - USD ($) $ in Thousands | Jan. 03, 2020 | Dec. 28, 2018 |
Assets: | ||
Right-of-use assets included in other long-term assets | $ 41,835 | $ 5,867 |
Liabilities: | ||
Current portion included in other current liabilities | 2,728 | 2,738 |
Long-term portion of operating lease liabilities | 48,011 | 12,099 |
Total operating lease liabilities | $ 50,739 | $ 14,837 |
Commitments (Components of Leas
Commitments (Components of Lease Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Operating lease cost | $ 2,844 | $ 4,189 | |
Operating lease cost | $ 3,944 | ||
Variable lease cost | 1,024 | 1,661 | |
Variable lease cost | 2,216 | ||
Sublease income | 0 | 0 | |
Sublease income | (1,225) | ||
Total operating lease costs | $ 3,868 | $ 5,850 | |
Total operating lease costs | $ 4,935 |
Commitments (Maturities of Oper
Commitments (Maturities of Operating Lease Liabilities) (Details) - USD ($) $ in Thousands | Jan. 03, 2020 | Dec. 28, 2018 |
Year Ending December 31, | ||
2020 | $ 4,538 | |
2021 | 4,669 | |
2022 | 4,820 | |
2023 | 5,147 | |
2024 | 5,407 | |
Thereafter | 41,585 | |
Total lease payments | 66,166 | |
Less: | ||
Imputed interest | (13,685) | |
Future tenant improvement reimbursements | (1,742) | |
Total operating lease liabilities | $ 50,739 | $ 14,837 |
Quarterly Financial Data (Una_3
Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 03, 2020 | Sep. 27, 2019 | Jun. 28, 2019 | Mar. 29, 2019 | Dec. 28, 2018 | Sep. 29, 2018 | Jun. 29, 2018 | Mar. 31, 2018 | Jan. 03, 2020 | Dec. 28, 2018 | Dec. 29, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Total revenues | $ 240,310 | $ 271,703 | $ 240,275 | $ 215,487 | $ 228,602 | $ 225,397 | $ 186,108 | $ 213,719 | $ 967,775 | $ 853,826 | $ 452,477 |
Gross profit | 184,406 | 184,231 | 186,136 | 172,080 | 168,873 | 155,586 | 139,839 | 128,633 | |||
Income from operations | 77,316 | 115,606 | 91,989 | 84,559 | 111,602 | 125,176 | 85,770 | 116,307 | 369,470 | 438,855 | 165,910 |
Net income | $ 68,743 | $ 97,452 | $ 79,042 | $ 75,775 | $ 360,089 | $ 126,630 | $ 87,494 | $ 115,857 | $ 321,012 | $ 690,070 | $ 154,227 |
Net income per share, basic (in dollars per share) | $ 0.23 | $ 0.32 | $ 0.26 | $ 0.25 | $ 1.20 | $ 0.42 | $ 0.29 | $ 0.39 | $ 1.06 | $ 2.32 | $ 0.52 |
Net income per share, diluted (in dollars per share) | $ 0.22 | $ 0.31 | $ 0.25 | $ 0.24 | $ 1.15 | $ 0.41 | $ 0.28 | $ 0.37 | $ 1.02 | $ 2.21 | $ 0.49 |
Income tax provision (benefit) | $ 244,100 | $ 3,500 | $ (360,800) | ||||||||
Milestone payments earned | $ 15,100 | $ 50,600 | $ 20,400 | $ 10,000 | $ 29,600 | $ 42,600 | $ 25,800 | $ 66,500 |
Uncategorized Items - exel20191
Label | Element | Value |
Accounting Standards Update 2014-09 [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 258,505,000 |
Accounting Standards Update 2014-09 [Member] | Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 258,505,000 |
Accounting Standards Update 2016-02 [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 234,000 |
Accounting Standards Update 2016-02 [Member] | Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 234,000 |
Accounting Standards Update 2016-09 [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 0 |
Accounting Standards Update 2016-09 [Member] | Additional Paid-in Capital [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 252,000 |
Accounting Standards Update 2016-09 [Member] | Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ (252,000) |