VICAL INC, 10-Q filed on 5/15/2017
Quarterly Report
Document and Entity Information
3 Months Ended
Mar. 31, 2017
Apr. 30, 2017
Document And Entity Information [Abstract]
 
 
Document Type
10-Q 
 
Amendment Flag
false 
 
Document Period End Date
Mar. 31, 2017 
 
Document Fiscal Year Focus
2017 
 
Document Fiscal Period Focus
Q1 
 
Trading Symbol
VICL 
 
Entity Registrant Name
VICAL INC 
 
Entity Central Index Key
0000819050 
 
Current Fiscal Year End Date
--12-31 
 
Entity Filer Category
Smaller Reporting Company 
 
Entity Common Stock, Shares Outstanding
 
11,096,203 
Balance Sheets (USD $)
In Thousands, unless otherwise specified
Mar. 31, 2017
Dec. 31, 2016
Current assets:
 
 
Cash and cash equivalents
$ 4,564 
$ 5,069 
Marketable securities, available-for-sale
29,216 
30,552 
Restricted cash
3,311 
3,311 
Deferred contract costs
7,163 
5,513 
Receivables and other assets
2,943 
3,422 
Total current assets
47,197 
47,867 
Long-term investments
2,108 
2,046 
Property and equipment, net
964 
1,173 
Intangible assets, net
784 
810 
Other assets
388 
388 
Total assets
51,441 
52,284 
Current liabilities:
 
 
Accounts payable and accrued expenses
3,539 
4,127 
Deferred revenue
5,316 
3,018 
Total current liabilities
8,855 
7,145 
Stockholders' equity:
 
 
Preferred stock, $0.01 par value, 5,000 shares authorized, none issued and outstanding
Common stock, $0.01 par value, 160,000 shares authorized, 11,095 and 11,052 shares issued and outstanding at March 31, 2017 and December 31, 2016, respectively
111 
111 
Additional paid-in capital
459,017 
458,881 
Accumulated deficit
(416,603)
(413,878)
Accumulated other comprehensive income
61 
25 
Total stockholders' equity
42,586 
45,139 
Total liabilities and stockholders' equity
$ 51,441 
$ 52,284 
Balance Sheets (Parenthetical) (USD $)
Mar. 31, 2017
Dec. 31, 2016
Statement Of Financial Position [Abstract]
 
 
Preferred stock, par value
$ 0.01 
$ 0.01 
Preferred stock, shares authorized
5,000,000 
5,000,000 
Preferred stock, shares issued
Preferred stock, shares outstanding
Common stock, par value
$ 0.01 
$ 0.01 
Common stock, shares authorized
160,000,000 
160,000,000 
Common stock, shares issued
11,095,000 
11,052,000 
Common stock, shares outstanding
11,095,000 
11,052,000 
Statements of Operations (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended
Mar. 31, 2017
Mar. 31, 2016
Revenues:
 
 
Contract revenue
$ 2,901 
$ 4,088 
License and royalty revenue
304 
516 
Total revenues
3,205 
4,604 
Operating expenses:
 
 
Research and development
3,300 
2,478 
Manufacturing and production
1,309 
2,846 
General and administrative
1,509 
1,790 
Total operating expenses
6,118 
7,114 
Loss from operations
(2,913)
(2,510)
Other income:
 
 
Investment and other income, net
89 
87 
Net loss
$ (2,824)
$ (2,423)
Basic and diluted net loss per share
$ (0.25)
$ (0.26)
Weighted average shares used in computing basic and diluted net loss per share
11,101 
9,217 
Statements of Comprehensive Loss (USD $)
In Thousands, unless otherwise specified
3 Months Ended
Mar. 31, 2017
Mar. 31, 2016
Statement Of Income And Comprehensive Income [Abstract]
 
 
Net loss
$ (2,824)
$ (2,423)
Unrealized gain on available-for-sale and long-term marketable securities:
 
 
Unrealized gain arising during holding period, net of tax benefit of $21 and $44 for three months ended March 31, 2017 and 2016, respectively
36 
95 
Other comprehensive gain
36 
95 
Total comprehensive loss
$ (2,788)
$ (2,328)
Statements of Comprehensive Loss (Parenthetical) (USD $)
In Thousands, unless otherwise specified
3 Months Ended
Mar. 31, 2017
Mar. 31, 2016
Statement Of Income And Comprehensive Income [Abstract]
 
 
Unrealized gain arising during holding period, tax benefit
$ 21 
$ 44 
Statements of Cash Flows (USD $)
In Thousands, unless otherwise specified
3 Months Ended
Mar. 31, 2017
Mar. 31, 2016
Cash flows from operating activities:
 
 
Net loss
$ (2,824)
$ (2,423)
Adjustments to reconcile net loss to net cash used in operating activities:
 
 
Depreciation and amortization
267 
277 
Write-off of abandoned patents
363 
Compensation expense related to stock options and awards
231 
313 
Changes in operating assets and liabilities:
 
 
Deferred contract costs
(1,650)
(115)
Receivables and other assets
479 
498 
Accounts payable and accrued expenses
(370)
(315)
Deferred revenue
2,298 
(166)
Deferred rent
(217)
(119)
Net cash used in operating activities
(1,786)
(1,687)
Cash flows from investing activities:
 
 
Maturities of marketable securities
6,479 
4,296 
Purchases of marketable securities
(5,187)
(10,039)
Purchases of property and equipment
(14)
(91)
Net cash provided by (used in) investing activities
1,278 
(5,834)
Cash flows from financing activities:
 
 
Net proceeds from issuance of common stock
Payment of withholding taxes for net settlement of restricted stock units
(1)
(7)
Net cash provided by (used in) financing activities
(2)
Net decrease in cash and cash equivalents
(505)
(7,523)
Cash and cash equivalents at beginning of period
5,069 
13,450 
Cash and cash equivalents at end of period
$ 4,564 
$ 5,927 
Basis of Presentation
Basis of Presentation

1.

BASIS OF PRESENTATION

Vical Incorporated, or the Company, a Delaware corporation, was incorporated in April 1987 and has devoted substantially all of its resources since that time to its research and development programs. The Company researches and develops biopharmaceutical products, including those based on its patented DNA delivery technologies, for the prevention and treatment of serious or life-threatening diseases.

All of the Company’s potential products are in research and development phases. No revenues have been generated from the sale of any such products, nor are any such revenues expected for at least the next several years. The Company earns revenue from research and development agreements with pharmaceutical collaborators and from contract manufacturing agreements. Most of the Company’s product candidates will require significant additional research and development efforts, including extensive preclinical and clinical testing. All product candidates that advance to clinical testing will require regulatory approval prior to commercial use, and will require significant costs for commercialization. There can be no assurance that the Company’s research and development efforts, or those of its collaborators, will be successful. The Company expects to continue to incur substantial losses and not generate positive cash flows from operations for at least the next several years. No assurance can be given that the Company can generate sufficient product revenue to become profitable or generate positive cash flows from operations.

The unaudited financial statements at March 31, 2017, and for the three months ended March 31, 2017 and 2016, have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission, or SEC, and with accounting principles generally accepted in the United States applicable to interim financial statements. These unaudited financial statements have been prepared on the same basis as the audited financial statements included in the Company’s Annual Report on Form 10-K and include all adjustments, consisting of only normal recurring accruals, which in the opinion of management are necessary to present fairly the Company’s financial position as of the interim date and results of operations for the interim periods presented. Interim results are not necessarily indicative of results expected for a full year or future periods. The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates. These unaudited financial statements should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2016, included in its Annual Report on Form 10-K filed with the SEC.

On May 25, 2016, the Company amended its certificate of incorporation to effect a one-for-ten (1:10) reverse stock split.  This reverse stock split became effective as of the close of business on May 26, 2016.  The reverse stock split had no effect on the par value of its common stock and did not reduce the number of authorized shares of common stock but reduced the number of outstanding shares of common stock by the ratio. Accordingly, the outstanding shares, stock award disclosures, net loss per share, and other per share disclosures for all periods presented have been retrospectively adjusted to reflect the impact of this reverse stock split.

The reverse stock split resulted in a proportionate adjustment to the per share exercise price and the number of shares of common stock issuable upon the exercise of outstanding stock options, the number of shares of common stock issuable upon the vesting of restricted stock units, or RSUs, and the number of shares of common stock eligible for issuance under the Company’s stock incentive plan.  No fractional shares were issued in connection with the reverse stock split.  Each stockholder’s percentage ownership and proportional voting power generally remained unchanged as a result of the reverse stock split.

Cash, Cash Equivalents and Marketable Securities

Cash and cash equivalents consist of cash and highly liquid securities with original maturities at the date of acquisition of ninety days or less and can be liquidated without prior notice or penalty. Investments with an original maturity of more than ninety days are considered marketable securities and have been classified by management as available-for-sale. These investments are classified as current assets, even though the stated maturity date may be one year or more beyond the current balance sheet date which reflects management’s intention to use the proceeds from sales of these securities to fund its operations, as necessary. Such investments are carried at fair value, with unrealized gains and losses included as a separate component of stockholders’ equity. Realized gains and losses from the sale of available-for-sale securities or the amounts, net of tax, reclassified out of accumulated other comprehensive income (loss), if any, are determined on a specific identification basis.

Restricted Cash

The Company is required to maintain a letter of credit securing an amount equal to twelve months of the current monthly installment of base rent for the original term of the lease for its facilities, which ends on August 31, 2017. At March 31, 2017, and December 31, 2016, restricted cash of $3.3 million was pledged as collateral for the letter of credit.  In July 2016, the term of the lease was extended for 16 months through December 2018.  During the extended term, the Company is required to maintain a letter of credit securing an amount equal to $0.2 million.

Revenue Recognition

Revenue is recognized when the four basic criteria of revenue recognition are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services rendered; (3) the fee is fixed or determinable; and (4) collectability is reasonably assured. Certain portions of the Company’s revenue are generated through manufacturing contracts and stand-alone license agreements.

Contract Manufacturing Revenue

Revenue associated with contract manufacturing services is recognized once the service has been rendered and/or upon shipment (or passage of title) of the product to the customer.  On occasion, the Company recognizes revenue on a “bill-and-hold” basis.  Revenue is recognized for such “bill-and-hold” arrangements in accordance with the authoritative guidance, which requires, among other things, the existence of a valid business purpose for the arrangement, that the “bill-and-hold” arrangement is at the request of the customer, that title and risk of ownership pass to the customer, that the product is complete and ready for shipment, a fixed delivery date that is reasonable and consistent with the customer’s business practices, that the product has been separated from the Company’s inventory, and that no further performance obligations by the Company exist.

Multiple-Element Arrangements

The Company has entered into multiple-element arrangements. In order to account for the multiple-element arrangements, the Company identifies the deliverables included within the agreement and evaluates which deliverables represent separate units of accounting. Analyzing the arrangement to identify deliverables requires the use of judgment, and each deliverable may be an obligation to deliver services, a right or license to use an asset, or another performance obligation. The delivered item(s) must have value to the customer on a standalone basis and, if the arrangement includes a general right of return relative to the delivered item, delivery or performance of the undelivered item(s) is considered probable and substantially in the Company’s control.

A delivered item is considered a separate unit of accounting when the delivered item has value to the partner on a standalone basis based on the consideration of the relevant facts and circumstances for each arrangement. Factors considered in this determination include the research capabilities of the partner and the availability of research expertise in this field in the general marketplace. Arrangement consideration is allocated at the inception of the agreement to all identified units of accounting based on their relative selling price. The relative selling price for each deliverable is determined using vendor specific objective evidence, or VSOE, of selling price or third-party evidence of selling price if VSOE does not exist. If neither VSOE nor third-party evidence of selling price exists, the Company uses its best estimate of the selling price for the deliverable. The amount of allocable arrangement consideration is limited to amounts that are fixed or determinable. The consideration received is allocated among the separate units of accounting, and the applicable revenue recognition criteria are applied to each of the separate units. Changes in the allocation of the sales price between delivered and undelivered elements can impact revenue recognition but do not change the total revenue recognized under any agreement. If facts and circumstances dictate that the license has standalone value from the undelivered items, which generally include research and development services and the manufacture of drug products, the license is identified as a separate unit of accounting and the amounts allocated to the license are recognized upon the delivery of the license, assuming the other revenue recognition criteria have been met. However, if the amounts allocated to the license through the relative selling price allocation exceed the upfront license fee, the amount recognized upon the delivery of the license is limited to the upfront fee received. If facts and circumstances dictate that the license does not have standalone value, the transaction price, including any upfront license fee payments received, are allocated to the identified separate units of accounting and recognized as those items are delivered.

The terms of the Company’s collaboration agreements provide for milestone payments upon achievement of certain regulatory and commercial events. Under the Milestone Method, the Company recognizes consideration that is contingent upon the achievement of a milestone in its entirety as revenue in the period in which the milestone is achieved only if the milestone is substantive in its entirety. A milestone is considered substantive when it meets all of the following criteria: 1) The consideration is commensurate with either the entity’s performance to achieve the milestone or the enhancement of the value of the delivered item(s) as a result of a specific outcome resulting from the entity’s performance to achieve the milestone, 2) The consideration relates solely to past performance, and 3) The consideration is reasonable relative to all of the deliverables and payment terms within the arrangement. A milestone is defined as an event (i) that can only be achieved based in whole or in part on either the entity’s performance or on the occurrence of a specific outcome resulting from the entity’s performance, (ii) for which there is substantive uncertainty at the date the arrangement is entered into that the event will be achieved and (iii) that would result in additional payments being due to the Company.

Contract Services, Grant and Royalty Revenue

The Company recognizes revenues from contract services and federal government research grants during the period in which the related expenditures are incurred and related payments for those services are received or collection is reasonably assured. Royalties to be received based on sales of licensed products by the Company’s collaborators incorporating the Company’s licensed technology are recognized when received.

Manufacturing and Production Costs

Manufacturing and production costs include expenses related to manufacturing contracts and expenses for the production of plasmid DNA for use in the Company’s research and development efforts. Manufacturing expenses related to manufacturing contracts are deferred and expensed when the related revenue is recognized. Deferred contract costs were $7.2 million and $5.5 million at March 31, 2017 and December 31, 2016, respectively. Production expenses related to the Company’s research and development efforts are expensed as incurred.

Net Loss Per Share

Basic and diluted net loss per share has been computed using the weighted-average number of shares of common stock outstanding during the period. The weighted average number of shares used to compute diluted loss per share excludes any assumed exercise of stock options and any assumed issuance of common stock under RSUs as the effect would be antidilutive. Common stock equivalents of 476 for the three months ended March 31, 2016 were excluded from the calculation because of their antidilutive effect.  There were no common stock equivalents for the three months ended March 31, 2017.              

Stock-Based Compensation

The Company records its compensation expense associated with stock options and other forms of equity compensation based on their fair value at the date of grant using the Black-Scholes-Merton option pricing model. Stock-based compensation includes amortization related to stock option awards based on the estimated grant date fair value. Stock-based compensation expense related to stock options is recognized ratably over the vesting period of the option. In addition, the Company records expense related to RSUs granted based on the fair value of those awards on the grant date. The fair value related to the RSUs is amortized to expense over the vesting term of those awards. Forfeitures of stock options and RSUs are recognized as they occur.  

Stock-based compensation expense for a stock-based award with a performance condition is recognized when the achievement of such performance condition is determined to be probable. If the outcome of such performance condition is not determined to be probable or is not met, no compensation expense is recognized and any previously recognized compensation expense is reversed.

Recent Accounting Pronouncements

In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers” which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The guidance outlines a five-step process for revenue recognition that focuses on transfer of control, as opposed to transfer of risk and rewards, and also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenues and cash flows from contracts with customers. Major provisions include determining which goods and services are distinct and require separate accounting (performance obligations), how variable consideration (which may include change orders and claims) is recognized, whether revenue should be recognized at a point in time or over time and ensuring the time value of money is considered in the transaction price. The guidance allows for either full retrospective or modified retrospective adoption and will become effective for the Company in the first quarter of 2018.

The Company is in the process of evaluating the impact of adopting the new revenue guidance on the Company’s financial position, results of operations, cash flows and related disclosures. Based on the Company’s initial assessment, the Company plans to adopt this new standard using the modified retrospective method which may result in a cumulative effect adjustment as of the date of adoption.  At this time, management does not expect the adoption of the new guidance to have a material impact on the revenue recognition related to contracts with remaining performance obligations upon the adoption of the standard. The impact on the Company’s financial statements is not expected to be material because, based upon the preliminary analysis of material contracts under the new revenue recognition standard, management has determined the recognition and allocation of revenue upon the delivery or completion of the Company’s performance obligations are consistent with those under the current revenue recognition model. The Company expects to complete its assessment process, including finalizing a transition method for adoption, by the end of the third quarter of 2017 and expects to complete its implementation process prior to the adoption of this ASU on January 1, 2018.

In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842).”  The new standard requires a lessee to record on the balance sheet the assets and liabilities for the rights and obligations created by leases with lease terms of more than 12 months and will require both lessees and lessors to disclose certain key information about lease transactions.  The standard will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years.  The Company is evaluating the effect that the adoption of the new guidance will have on its financial statements and related disclosures.

In March 2016, the FASB issued ASU No. 2016-09, “Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting.”  The amended guidance simplifies the accounting for share-based payment transactions and is effective for annual periods beginning after December 15, 2016.  The Company adopted this standard during the first quarter of 2017 and elected to recognize forfeitures as they occur. The adoption of this guidance did not have a material impact on the Company’s financial statements and related disclosures.

In November 2016, the FASB issued ASU No. 2016-18, “Statement of Cash Flows (Topic 230): Restricted Cash” that changes the presentation of restricted cash and cash equivalents on the statement of cash flows.  Restricted cash and restricted cash equivalents will be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows.  This new standard is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017, with early adoption permitted.  The Company is currently evaluating the impact that the adoption of the new guidance will have on its financial statements.

 

Stock-Based Compensation
Stock-Based Compensation

2.

STOCK-BASED COMPENSATION

Total stock-based compensation expense was allocated to research and development, manufacturing and production and general and administrative expense as follows (in thousands):

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2017

 

 

2016

 

Research and development

 

$

67

 

 

$

82

 

Manufacturing and production

 

 

28

 

 

 

33

 

General and administrative

 

 

136

 

 

 

198

 

Total stock-based compensation expense

 

$

231

 

 

$

313

 

 

During the three months ended March 31, 2017 and 2016, the Company granted stock-based awards with a total estimated value of $0.6 million and $0.5 million, respectively. At March 31, 2017, total unrecognized estimated compensation expense related to unvested stock-based awards granted prior to that date was $1.0 million, which is expected to be recognized over a weighted-average period of 1.4 years. Stock-based awards granted during the three months ended March 31, 2017 and 2016, were equal to 4.4% and 3.1%, respectively, of the outstanding shares of common stock at the end of the applicable period.

Marketable Securities, Available for Sale
Marketable Securities, Available for Sale

3.

MARKETABLE SECURITIES, AVAILABLE FOR SALE

The following is a summary of available-for-sale marketable securities (in thousands):

 

March 31, 2017

 

Amortized

Cost

 

 

Unrealized

Gain

 

 

Unrealized

Loss

 

 

Market

Value

 

U.S. treasuries

 

$

19,778

 

 

 

 

 

 

23

 

 

$

19,755

 

Certificates of deposit

 

 

9,461

 

 

 

 

 

 

 

 

 

9,461

 

 

 

$

29,239

 

 

$

 

 

$

23

 

 

$

29,216

 

 

December 31, 2016

 

Amortized

Cost

 

 

Unrealized

Gain

 

 

Unrealized

Loss

 

 

Market

Value

 

U.S. treasuries

 

$

23,295

 

 

$

 

 

$

18

 

 

$

23,277

 

Certificates of deposit

 

 

7,275

 

 

 

 

 

 

 

 

 

7,275

 

 

 

$

30,570

 

 

$

 

 

$

18

 

 

$

30,552

 

 

At March 31, 2017, none of these securities were scheduled to mature outside of one year. The Company did not realize any gains or losses on sales of available-for-sale securities for the three months ended March 31, 2017. As of March 31, 2017, none of the securities had been in a continuous material unrealized loss position longer than one year.

Other Balance Sheet Accounts
Other Balance Sheet Accounts

4.

OTHER BALANCE SHEET ACCOUNTS

Accounts payable and accrued expenses consisted of the following (in thousands):

 

 

 

March 31,

 

 

December 31,

 

 

 

2017

 

 

2016

 

Employee compensation

 

$

1,501

 

 

$

2,518

 

Clinical trial accruals

 

 

931

 

 

 

446

 

Accounts payable

 

 

733

 

 

 

326

 

Deferred rent

 

 

6

 

 

 

223

 

Other accrued liabilities

 

 

368

 

 

 

614

 

Total accounts payable and accrued expenses

 

$

3,539

 

 

$

4,127

 

 

Long-Term Investments
Long-Term Investments

5.

LONG-TERM INVESTMENTS

As of March 31, 2017, the Company held an auction rate security with a par value of $2.5 million. This auction rate security has not experienced a successful auction since the liquidity issues experienced in the global credit and capital markets in 2008. As a result, the security is classified as a long-term investment as it is scheduled to mature in 2038. The security was rated A- by Standard and Poor’s as of March 31, 2017. The security continues to pay interest according to its stated terms.

The valuation of the Company’s auction rate security is subject to uncertainties that are difficult to predict. The fair value of the security is estimated utilizing a discounted cash flow analysis. The key drivers of the valuation model include the expected term, collateral underlying the security investment, the creditworthiness of the counterparty, the timing of expected future cash flows, discount rates, liquidity and the expected holding period. The security was also compared, when possible, to other observable market data for securities with similar characteristics. As of March 31, 2017, the inputs used in the Company’s discounted cash flow analysis assumed an interest rate of 2.46%, an estimated redemption period of five years and a discount rate of 1.00%. Based on the valuation of the security, the Company has recognized cumulative losses of $0.5 million as of March 31, 2017, none of which were realized during the three months ended March 31, 2017. The losses when recognized are included in investment and other income. The market value of the security has partially recovered. Included in other comprehensive income are unrealized gains of $41,000 and $86,000 for the three months ended March 31, 2017 and 2016, respectively. As of March 31, 2017, the Company had recorded cumulative unrealized gains of $0.3 million. The resulting carrying value of the auction rate security at March 31, 2017, was $2.1 million. Any future decline in market value may result in additional losses being recognized.

Fair Value Measurements
Fair Value Measurements

6.

FAIR VALUE MEASUREMENTS

The Company measures fair value as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. Fair value measurements are based on a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:

 

Level 1: Observable inputs such as quoted prices in active markets;

 

Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and

 

Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.   

Cash equivalents, marketable securities and long-term investments measured at fair value are classified in the table below in one of the three categories described above (in thousands):

 

 

 

Fair Value Measurements

 

March 31, 2017

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Certificates of deposit

 

$

9,461

 

 

$

 

 

$

 

 

$

9,461

 

Money market funds

 

 

3,033

 

 

 

 

 

 

 

 

 

3,033

 

U.S. treasuries

 

 

19,755

 

 

 

 

 

 

 

 

 

19,755

 

Auction rate securities

 

 

 

 

 

 

 

 

2,108

 

 

 

2,108

 

 

 

$

32,249

 

 

$

 

 

$

2,108

 

 

$

34,357

 

 

 

 

Fair Value Measurements

 

December 31, 2016

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Certificates of deposit

 

$

7,275

 

 

$

 

 

$

 

 

$

7,275

 

Money market funds

 

 

1,171

 

 

 

 

 

 

 

 

 

1,171

 

U.S. treasuries

 

 

23,277

 

 

 

 

 

 

 

 

 

23,277

 

Auction rate securities

 

 

 

 

 

 

 

 

2,046

 

 

 

2,046

 

 

 

$

31,723

 

 

$

 

 

$

2,046

 

 

$

33,769

 

 

The Company’s investments in U.S. treasury securities, certificates of deposit and money market funds are valued based on publicly available quoted market prices for identical securities as of March 31, 2017. The Company determines the fair value of corporate bonds and other government-sponsored enterprise related securities with the aid of valuations provided by third parties using proprietary valuation models and analytical tools. These valuation models and analytical tools use market pricing or similar instruments that are both objective and publicly available, including matrix pricing or reported trades, benchmark yields, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids and/or offers. The Company validates the valuations received from its primary pricing vendors for its Level 2 securities by examining the inputs used in that vendor’s pricing process and determines whether they are reasonable and observable. The Company also compares those valuations to recent reported trades for those securities. As of March 31, 2017 and December 31, 2016, the Company had no investments in Level 2 securities. The Company did not transfer any investments between level categories during the three months ended March 31, 2017. The valuation of the Company’s investments in auction rate securities, which includes significant unobservable inputs, is more fully described in Note 5.

Activity for assets measured at fair value using significant unobservable inputs (Level 3) is presented in the table below (in thousands):

 

Balance at December 31, 2016

 

$

2,046

 

Total unrealized gains, excluding tax impact, included in other comprehensive gain

 

 

62

 

Balance at March 31, 2017

 

$

2,108

 

Total gains or losses for the period included in net loss attributable to the change in

   unrealized gains or losses relating to assets still held at the reporting date

 

$

 

 

Commitments and Contingencies
Commitments and Contingencies

7.

COMMITMENTS AND CONTINGENCIES

In the ordinary course of business, the Company may become a party to additional lawsuits involving various matters. The Company is unaware of any such lawsuits presently pending against it which, individually or in the aggregate, are deemed to be material to the Company’s financial condition or results of operations.

The Company prosecutes its intellectual property vigorously to obtain the broadest valid scope for its patents. Due to uncertainty of the ultimate outcome of these matters, the impact on future operating results or the Company’s financial condition is not subject to reasonable estimates.

Astellas License Agreements (Astellas Out-License Agreements [Member])
Astellas License Agreements

8.

ASTELLAS OUT-LICENSE AGREEMENTS

In July 2011, the Company entered into license agreements with Astellas Pharma Inc., or Astellas, granting Astellas exclusive, worldwide, royalty-bearing licenses under certain of the Company's know-how and intellectual property to develop and commercialize certain products containing plasmids encoding certain forms of cytomegalovirus, glycoprotein B and/or phosphoprotein 65, including ASP0113 (TransVax™) but excluding CyMVectin™.

Under the terms of the agreements, the Company is performing research and development services and manufacturing services which are being paid for by Astellas. During the three months ended March 31, 2017 and 2016, the Company recognized $2.9 million and $3.8 million, respectively, of revenue related to these contract services.  The Company also recognized $0.3 million and $0.5 million in license revenue under the Astellas agreements during the three months ended March 31, 2017 and 2016, respectively.

Facility Lease
Facility Lease

9.

FACILITY LEASE

The Company leases approximately 68,400 square feet of manufacturing, research laboratory and office space at a single site in San Diego, California.  In July 2016, the term of the lease was extended for 16 months through December 2018, resulting in an additional obligation of $2.9 million.

 

Stockholders' Equity
Stockholders' Equity

10.

STOCKHOLDERS’ EQUITY

On August 1, 2016, the Company entered into a stock purchase agreement with AnGes MG, Inc., or AnGes, an existing stockholder, to purchase 1,841,420 shares of the Company’s common stock in a private placement. The shares were sold at a price of $4.24 per share. Gross proceeds totaled approximately $7.8 million. The private placement closed on August 2, 2016.

The shares are subject to a two-year lock-up period in which they may not be sold and AnGes has agreed to not increase its ownership position beyond 19.9% and to refrain from taking certain other actions with respect to the Company’s stock, subject to certain conditions. AnGes is entitled to have a representative attend meetings of the Company’s Board of Directors in a non-voting capacity and may in the future be entitled to have a representative appointed to the Company’s Board of Directors, subject to certain conditions. AnGes has also agreed to vote its shares in accordance with the recommendations of the Company’s Board of Directors for so long as it continues to hold a specified percentage of the Company’s outstanding common stock. The Company also agreed under certain circumstances in the future to register the shares for resale by AnGes.

 

Subsequent Events
Subsequent Events

11.

SUBSEQUENT EVENT

On April 4, 2017, the Company entered into a research collaboration agreement with AnGes. As of the date of the transaction, AnGes held 18.6% of the outstanding stock of the Company. Pursuant to the collaboration agreement, AnGes agreed to pay the Company a total of $750,000 and the Company agreed to conduct certain preclinical research related to a development program targeting chronic hepatitis B. In exchange for the payment, AnGes received an option to negotiate exclusive rights in Japan related to the program. The parties also agreed to share the costs of prosecuting and maintaining intellectual property rights arising from the research program after such costs reach a specified limit.

Basis of Presentation (Policies)

Cash, Cash Equivalents and Marketable Securities

Cash and cash equivalents consist of cash and highly liquid securities with original maturities at the date of acquisition of ninety days or less and can be liquidated without prior notice or penalty. Investments with an original maturity of more than ninety days are considered marketable securities and have been classified by management as available-for-sale. These investments are classified as current assets, even though the stated maturity date may be one year or more beyond the current balance sheet date which reflects management’s intention to use the proceeds from sales of these securities to fund its operations, as necessary. Such investments are carried at fair value, with unrealized gains and losses included as a separate component of stockholders’ equity. Realized gains and losses from the sale of available-for-sale securities or the amounts, net of tax, reclassified out of accumulated other comprehensive income (loss), if any, are determined on a specific identification basis.

Restricted Cash

The Company is required to maintain a letter of credit securing an amount equal to twelve months of the current monthly installment of base rent for the original term of the lease for its facilities, which ends on August 31, 2017. At March 31, 2017, and December 31, 2016, restricted cash of $3.3 million was pledged as collateral for the letter of credit.  In July 2016, the term of the lease was extended for 16 months through December 2018.  During the extended term, the Company is required to maintain a letter of credit securing an amount equal to $0.2 million.

Revenue Recognition

Revenue is recognized when the four basic criteria of revenue recognition are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services rendered; (3) the fee is fixed or determinable; and (4) collectability is reasonably assured. Certain portions of the Company’s revenue are generated through manufacturing contracts and stand-alone license agreements.

Contract Manufacturing Revenue

Revenue associated with contract manufacturing services is recognized once the service has been rendered and/or upon shipment (or passage of title) of the product to the customer.  On occasion, the Company recognizes revenue on a “bill-and-hold” basis.  Revenue is recognized for such “bill-and-hold” arrangements in accordance with the authoritative guidance, which requires, among other things, the existence of a valid business purpose for the arrangement, that the “bill-and-hold” arrangement is at the request of the customer, that title and risk of ownership pass to the customer, that the product is complete and ready for shipment, a fixed delivery date that is reasonable and consistent with the customer’s business practices, that the product has been separated from the Company’s inventory, and that no further performance obligations by the Company exist.

Multiple-Element Arrangements

The Company has entered into multiple-element arrangements. In order to account for the multiple-element arrangements, the Company identifies the deliverables included within the agreement and evaluates which deliverables represent separate units of accounting. Analyzing the arrangement to identify deliverables requires the use of judgment, and each deliverable may be an obligation to deliver services, a right or license to use an asset, or another performance obligation. The delivered item(s) must have value to the customer on a standalone basis and, if the arrangement includes a general right of return relative to the delivered item, delivery or performance of the undelivered item(s) is considered probable and substantially in the Company’s control.

A delivered item is considered a separate unit of accounting when the delivered item has value to the partner on a standalone basis based on the consideration of the relevant facts and circumstances for each arrangement. Factors considered in this determination include the research capabilities of the partner and the availability of research expertise in this field in the general marketplace. Arrangement consideration is allocated at the inception of the agreement to all identified units of accounting based on their relative selling price. The relative selling price for each deliverable is determined using vendor specific objective evidence, or VSOE, of selling price or third-party evidence of selling price if VSOE does not exist. If neither VSOE nor third-party evidence of selling price exists, the Company uses its best estimate of the selling price for the deliverable. The amount of allocable arrangement consideration is limited to amounts that are fixed or determinable. The consideration received is allocated among the separate units of accounting, and the applicable revenue recognition criteria are applied to each of the separate units. Changes in the allocation of the sales price between delivered and undelivered elements can impact revenue recognition but do not change the total revenue recognized under any agreement. If facts and circumstances dictate that the license has standalone value from the undelivered items, which generally include research and development services and the manufacture of drug products, the license is identified as a separate unit of accounting and the amounts allocated to the license are recognized upon the delivery of the license, assuming the other revenue recognition criteria have been met. However, if the amounts allocated to the license through the relative selling price allocation exceed the upfront license fee, the amount recognized upon the delivery of the license is limited to the upfront fee received. If facts and circumstances dictate that the license does not have standalone value, the transaction price, including any upfront license fee payments received, are allocated to the identified separate units of accounting and recognized as those items are delivered.

The terms of the Company’s collaboration agreements provide for milestone payments upon achievement of certain regulatory and commercial events. Under the Milestone Method, the Company recognizes consideration that is contingent upon the achievement of a milestone in its entirety as revenue in the period in which the milestone is achieved only if the milestone is substantive in its entirety. A milestone is considered substantive when it meets all of the following criteria: 1) The consideration is commensurate with either the entity’s performance to achieve the milestone or the enhancement of the value of the delivered item(s) as a result of a specific outcome resulting from the entity’s performance to achieve the milestone, 2) The consideration relates solely to past performance, and 3) The consideration is reasonable relative to all of the deliverables and payment terms within the arrangement. A milestone is defined as an event (i) that can only be achieved based in whole or in part on either the entity’s performance or on the occurrence of a specific outcome resulting from the entity’s performance, (ii) for which there is substantive uncertainty at the date the arrangement is entered into that the event will be achieved and (iii) that would result in additional payments being due to the Company.

Contract Services, Grant and Royalty Revenue

The Company recognizes revenues from contract services and federal government research grants during the period in which the related expenditures are incurred and related payments for those services are received or collection is reasonably assured. Royalties to be received based on sales of licensed products by the Company’s collaborators incorporating the Company’s licensed technology are recognized when received.

Manufacturing and Production Costs

Manufacturing and production costs include expenses related to manufacturing contracts and expenses for the production of plasmid DNA for use in the Company’s research and development efforts. Manufacturing expenses related to manufacturing contracts are deferred and expensed when the related revenue is recognized. Deferred contract costs were $7.2 million and $5.5 million at March 31, 2017 and December 31, 2016, respectively. Production expenses related to the Company’s research and development efforts are expensed as incurred.

Net Loss Per Share

Basic and diluted net loss per share has been computed using the weighted-average number of shares of common stock outstanding during the period. The weighted average number of shares used to compute diluted loss per share excludes any assumed exercise of stock options and any assumed issuance of common stock under RSUs as the effect would be antidilutive. Common stock equivalents of 476 for the three months ended March 31, 2016 were excluded from the calculation because of their antidilutive effect.  There were no common stock equivalents for the three months ended March 31, 2017.              

Stock-Based Compensation

The Company records its compensation expense associated with stock options and other forms of equity compensation based on their fair value at the date of grant using the Black-Scholes-Merton option pricing model. Stock-based compensation includes amortization related to stock option awards based on the estimated grant date fair value. Stock-based compensation expense related to stock options is recognized ratably over the vesting period of the option. In addition, the Company records expense related to RSUs granted based on the fair value of those awards on the grant date. The fair value related to the RSUs is amortized to expense over the vesting term of those awards. Forfeitures of stock options and RSUs are recognized as they occur.  

Stock-based compensation expense for a stock-based award with a performance condition is recognized when the achievement of such performance condition is determined to be probable. If the outcome of such performance condition is not determined to be probable or is not met, no compensation expense is recognized and any previously recognized compensation expense is reversed.

Recent Accounting Pronouncements

In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers” which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The guidance outlines a five-step process for revenue recognition that focuses on transfer of control, as opposed to transfer of risk and rewards, and also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenues and cash flows from contracts with customers. Major provisions include determining which goods and services are distinct and require separate accounting (performance obligations), how variable consideration (which may include change orders and claims) is recognized, whether revenue should be recognized at a point in time or over time and ensuring the time value of money is considered in the transaction price. The guidance allows for either full retrospective or modified retrospective adoption and will become effective for the Company in the first quarter of 2018.

The Company is in the process of evaluating the impact of adopting the new revenue guidance on the Company’s financial position, results of operations, cash flows and related disclosures. Based on the Company’s initial assessment, the Company plans to adopt this new standard using the modified retrospective method which may result in a cumulative effect adjustment as of the date of adoption.  At this time, management does not expect the adoption of the new guidance to have a material impact on the revenue recognition related to contracts with remaining performance obligations upon the adoption of the standard. The impact on the Company’s financial statements is not expected to be material because, based upon the preliminary analysis of material contracts under the new revenue recognition standard, management has determined the recognition and allocation of revenue upon the delivery or completion of the Company’s performance obligations are consistent with those under the current revenue recognition model. The Company expects to complete its assessment process, including finalizing a transition method for adoption, by the end of the third quarter of 2017 and expects to complete its implementation process prior to the adoption of this ASU on January 1, 2018.

In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842).”  The new standard requires a lessee to record on the balance sheet the assets and liabilities for the rights and obligations created by leases with lease terms of more than 12 months and will require both lessees and lessors to disclose certain key information about lease transactions.  The standard will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years.  The Company is evaluating the effect that the adoption of the new guidance will have on its financial statements and related disclosures.

In March 2016, the FASB issued ASU No. 2016-09, “Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting.”  The amended guidance simplifies the accounting for share-based payment transactions and is effective for annual periods beginning after December 15, 2016.  The Company adopted this standard during the first quarter of 2017 and elected to recognize forfeitures as they occur. The adoption of this guidance did not have a material impact on the Company’s financial statements and related disclosures.

In November 2016, the FASB issued ASU No. 2016-18, “Statement of Cash Flows (Topic 230): Restricted Cash” that changes the presentation of restricted cash and cash equivalents on the statement of cash flows.  Restricted cash and restricted cash equivalents will be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows.  This new standard is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017, with early adoption permitted.  The Company is currently evaluating the impact that the adoption of the new guidance will have on its financial statements.

 

Stock-Based Compensation (Tables)
Summary of Total Stock-Based Compensation Expense

Total stock-based compensation expense was allocated to research and development, manufacturing and production and general and administrative expense as follows (in thousands):

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2017

 

 

2016

 

Research and development

 

$

67

 

 

$

82

 

Manufacturing and production

 

 

28

 

 

 

33

 

General and administrative

 

 

136

 

 

 

198

 

Total stock-based compensation expense

 

$

231

 

 

$

313

 

 

Marketable Securities, Available for Sale (Tables)
Summary of Available-for-Sale Marketable Securities

The following is a summary of available-for-sale marketable securities (in thousands):

 

March 31, 2017

 

Amortized

Cost

 

 

Unrealized

Gain

 

 

Unrealized

Loss

 

 

Market

Value

 

U.S. treasuries

 

$

19,778

 

 

 

 

 

 

23

 

 

$

19,755

 

Certificates of deposit

 

 

9,461

 

 

 

 

 

 

 

 

 

9,461

 

 

 

$

29,239

 

 

$

 

 

$

23

 

 

$

29,216

 

 

December 31, 2016

 

Amortized

Cost

 

 

Unrealized

Gain

 

 

Unrealized

Loss

 

 

Market

Value

 

U.S. treasuries

 

$

23,295

 

 

$

 

 

$

18

 

 

$

23,277

 

Certificates of deposit

 

 

7,275

 

 

 

 

 

 

 

 

 

7,275

 

 

 

$

30,570

 

 

$

 

 

$

18

 

 

$

30,552

 

 

Other Balance Sheet Accounts (Tables)
Summary of Accounts Payable and Accrued Expenses

Accounts payable and accrued expenses consisted of the following (in thousands):

 

 

 

March 31,

 

 

December 31,

 

 

 

2017

 

 

2016

 

Employee compensation

 

$

1,501

 

 

$

2,518

 

Clinical trial accruals

 

 

931

 

 

 

446

 

Accounts payable

 

 

733

 

 

 

326

 

Deferred rent

 

 

6

 

 

 

223

 

Other accrued liabilities

 

 

368

 

 

 

614

 

Total accounts payable and accrued expenses

 

$

3,539

 

 

$

4,127

 

 

Fair Value Measurements (Tables)

Cash equivalents, marketable securities and long-term investments measured at fair value are classified in the table below in one of the three categories described above (in thousands):

 

 

 

Fair Value Measurements

 

March 31, 2017

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Certificates of deposit

 

$

9,461

 

 

$

 

 

$

 

 

$

9,461

 

Money market funds

 

 

3,033

 

 

 

 

 

 

 

 

 

3,033

 

U.S. treasuries

 

 

19,755

 

 

 

 

 

 

 

 

 

19,755

 

Auction rate securities

 

 

 

 

 

 

 

 

2,108

 

 

 

2,108

 

 

 

$

32,249

 

 

$

 

 

$

2,108

 

 

$

34,357

 

 

 

 

Fair Value Measurements

 

December 31, 2016

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Certificates of deposit

 

$

7,275

 

 

$

 

 

$

 

 

$

7,275

 

Money market funds

 

 

1,171

 

 

 

 

 

 

 

 

 

1,171

 

U.S. treasuries

 

 

23,277

 

 

 

 

 

 

 

 

 

23,277

 

Auction rate securities

 

 

 

 

 

 

 

 

2,046

 

 

 

2,046

 

 

 

$

31,723

 

 

$

 

 

$

2,046

 

 

$

33,769

 

 

Activity for assets measured at fair value using significant unobservable inputs (Level 3) is presented in the table below (in thousands):

 

Balance at December 31, 2016

 

$

2,046

 

Total unrealized gains, excluding tax impact, included in other comprehensive gain

 

 

62

 

Balance at March 31, 2017

 

$

2,108

 

Total gains or losses for the period included in net loss attributable to the change in

   unrealized gains or losses relating to assets still held at the reporting date

 

$

 

 

Basis of Presentation - Additional Information (Detail) (USD $)
0 Months Ended 3 Months Ended
Jul. 31, 2016
May 25, 2016
Mar. 31, 2017
Mar. 31, 2016
Dec. 31, 2016
Organization Consolidation And Presentation Of Financial Statements [Abstract]
 
 
 
 
 
Reverse stock split, description
 
 
one-for-ten (1:10) reverse stock split 
 
 
Reverse stock split, ratio
 
10 
 
 
 
Maximum period for cash and highly liquid securities with original maturities
 
 
90 days or less 
 
 
Minimum period for marketable securities classified as available-for-sale with original maturities
 
 
More than 90 days 
 
 
Amount of letter of credit, description
 
 
The Company is required to maintain a letter of credit securing an amount equal to twelve months of the current monthly installment of base rent for the original term of the lease for its facilities, which ends on August 31, 2017. 
 
 
Restricted cash
 
 
$ 3,311,000 
 
$ 3,311,000 
Renewal period for lease for lease beyond its expiration
16 months 
 
 
 
 
Renewal lease agreement expiry date
Dec. 31, 2018 
 
 
 
 
Secured letter of credit for the extended lease term
 
 
200,000 
 
 
Deferred contract costs
 
 
$ 7,200,000 
 
$ 5,500,000 
Common stock equivalents excluded from the calculation of diluted net income per share
 
 
476 
 
Stock-Based Compensation - Summary of Total Stock-Based Compensation Expense (Detail) (USD $)
In Thousands, unless otherwise specified
3 Months Ended
Mar. 31, 2017
Mar. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
 
 
Total stock-based compensation expense
$ 231 
$ 313 
Research and development [Member]
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
 
 
Total stock-based compensation expense
67 
82 
Manufacturing and production [Member]
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
 
 
Total stock-based compensation expense
28 
33 
General and administrative [Member]
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
 
 
Total stock-based compensation expense
$ 136 
$ 198 
Stock-Based Compensation - Additional Information (Detail) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2017
Mar. 31, 2016
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
 
 
Estimated value of stock-based awards, granted
$ 0.6 
$ 0.5 
Unrecognized compensation cost related to unvested options
$ 1.0 
 
Unvested stock-based awards expected to be recognized, weighted-average period
1 year 4 months 24 days 
 
Portion of stock-based awards granted from outstanding common shares
4.40% 
3.10% 
Marketable Securities, Available for Sale - Summary of Available-for-Sale Marketable Securities (Detail) (USD $)
In Thousands, unless otherwise specified
Mar. 31, 2017
Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
 
 
Amortized Cost
$ 29,239 
$ 30,570 
Unrealized Gain
Unrealized Loss
23 
18 
Market Value
29,216 
30,552 
U.S. treasuries [Member]
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
Amortized Cost
19,778 
23,295 
Unrealized Gain
Unrealized Loss
23 
18 
Market Value
19,755 
23,277 
Certificates of deposit [Member]
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
Amortized Cost
9,461 
7,275 
Unrealized Gain
Unrealized Loss
Market Value
$ 9,461 
$ 7,275 
Marketable Securities, Available for Sale - Additional Information (Detail) (USD $)
3 Months Ended
Mar. 31, 2017
Investments Debt And Equity Securities [Abstract]
 
Available-for-sale securities maturing outside of one year
$ 0 
Realized gains or losses on sales of available-for-sale securities
Available-for-sale securities in a continuous material unrealized loss position longer than one year
$ 0 
Other Balance Sheet Accounts - Summary of Accounts Payable and Accrued Expenses (Detail) (USD $)
In Thousands, unless otherwise specified
Mar. 31, 2017
Dec. 31, 2016
Payables And Accruals [Abstract]
 
 
Employee compensation
$ 1,501 
$ 2,518 
Clinical trial accruals
931 
446 
Accounts payable
733 
326 
Deferred rent
223 
Other accrued liabilities
368 
614 
Total accounts payable and accrued expenses
$ 3,539 
$ 4,127 
Long-Term Investments - Additional Information (Detail) (USD $)
3 Months Ended
Mar. 31, 2017
Mar. 31, 2016
Dec. 31, 2016
Investments Schedule [Abstract]
 
 
 
Auction rate securities held, at par value
$ 2,500,000 
 
 
Maturity of long-term investment
2038 
 
 
Recognized cumulative losses
500,000 
 
 
Unrealized gains on auction rate securities
41,000 
86,000 
 
Cumulative unrealized gains
300,000 
 
 
Carrying value of auction rate security
2,108,000 
 
2,046,000 
Assumed interest rate
2.46% 
 
 
Estimated redemption period
5 years 
 
 
Fair value input discount rate
1.00% 
 
 
Recognized cumulative losses realized
$ 0 
 
 
Fair Value Measurements - Summary of Cash Equivalents, Marketable Securities and Long-Term Investments Measured at Fair Value (Detail) (USD $)
In Thousands, unless otherwise specified
Mar. 31, 2017
Dec. 31, 2016
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair Value
$ 34,357 
$ 33,769 
Certificates of deposit [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair Value
9,461 
7,275 
Money market funds [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair Value
3,033 
1,171 
U.S. treasuries [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair Value
19,755 
23,277 
Auction rate securities [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair Value
2,108 
2,046 
Level 1 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair Value
32,249 
31,723 
Level 1 [Member] |
Certificates of deposit [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair Value
9,461 
7,275 
Level 1 [Member] |
Money market funds [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair Value
3,033 
1,171 
Level 1 [Member] |
U.S. treasuries [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair Value
19,755 
23,277 
Level 1 [Member] |
Auction rate securities [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair Value
Level 2 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair Value
Level 2 [Member] |
Certificates of deposit [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair Value
Level 2 [Member] |
Money market funds [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair Value
Level 2 [Member] |
U.S. treasuries [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair Value
Level 2 [Member] |
Auction rate securities [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair Value
Level 3 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair Value
2,108 
2,046 
Level 3 [Member] |
Certificates of deposit [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair Value
Level 3 [Member] |
Money market funds [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair Value
Level 3 [Member] |
U.S. treasuries [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair Value
Level 3 [Member] |
Auction rate securities [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair Value
$ 2,108 
$ 2,046 
Fair Value Measurements - Additional Information (Detail) (Level 2 [Member], USD $)
Mar. 31, 2017
Dec. 31, 2016
Level 2 [Member]
 
 
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items]
 
 
Investments
$ 0 
$ 0 
Fair Value Measurements - Summary of Activity for Assets Measured at Fair Value Using Significant Unobservable Inputs (Detail) (USD $)
In Thousands, unless otherwise specified
3 Months Ended
Mar. 31, 2017
Fair Value Disclosures [Abstract]
 
Balance at December 31, 2016
$ 2,046 
Total unrealized gains, excluding tax impact, included in other comprehensive gain
62 
Balance at March 31, 2017
2,108 
Total gains or losses for the period included in net loss attributable to the change in unrealized gains or losses relating to assets still held at the reporting date
$ 0 
Astellas Out-License Agreements - Additional Information (Detail) (Collaborative Arrangement [Member], Astellas Out-License Agreements [Member], USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2017
Mar. 31, 2016
Collaborative Arrangement [Member] |
Astellas Out-License Agreements [Member]
 
 
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
 
 
Revenue related to contract services
$ 2.9 
$ 3.8 
Recognized license revenue
$ 0.3 
$ 0.5 
Facility Lease - Additional Information (Detail) (USD $)
In Millions, unless otherwise specified
0 Months Ended 1 Months Ended
Jul. 31, 2016
Jul. 31, 2016
California [Member]
Mar. 31, 2017
California [Member]
sqft
Facility Lease [Line Items]
 
 
 
Area for leasing facility of manufacturing, research laboratory and office space
 
 
68,400 
Renewal period for lease for lease beyond its expiration
16 months 
16 months 
 
Renewal lease agreement expiry date
Dec. 31, 2018 
Dec. 31, 2018 
 
Additional obligation incurred
 
$ 2.9 
 
Stockholders' Equity - Additional Information (Detail) (USD $)
In Millions, except Share data, unless otherwise specified
0 Months Ended
Aug. 1, 2016
Stockholders Equity [Line Items]
 
Private placement, share lock-up period
2 years 
Maximum [Member]
 
Stockholders Equity [Line Items]
 
Equity position under stock purchase agreement
19.90% 
Stock Purchase Agreement with AnGes, MG, Inc in Private Placement [Member]
 
Stockholders Equity [Line Items]
 
Number of shares of common stock sold under the sales agreement
1,841,420 
Private placement, price per share
$ 4.24 
Private placement, gross proceeds
$ 7.8 
Private placement, closing date
Aug. 02, 2016 
Subsequent Events - Additional Information (Detail) (Research Collaboration Agreement [Member], AnGes MG, Inc [Member], Subsequent event [Member], USD $)
0 Months Ended
Apr. 4, 2017
Research Collaboration Agreement [Member] |
AnGes MG, Inc [Member] |
Subsequent event [Member]
 
Subsequent Event [Line Items]
 
Percentage of common stock outstanding
18.60% 
Amount receivable under research collaboration agreement
$ 750,000