ACORDA THERAPEUTICS INC, 10-Q filed on 11/6/2020
Quarterly Report
v3.20.2
Document and Entity Information - shares
9 Months Ended
Sep. 30, 2020
Oct. 30, 2020
Cover [Abstract]    
Entity Registrant Name ACORDA THERAPEUTICS, INC.  
Entity Central Index Key 0001008848  
Document Type 10-Q  
Document Period End Date Sep. 30, 2020  
Amendment Flag false  
Current Fiscal Year End Date --12-31  
Entity Filer Category Accelerated Filer  
Entity Current Reporting Status Yes  
Entity Interactive Data Current Yes  
Entity Small Business false  
Entity Emerging Growth Company false  
Entity Shell Company false  
Document Quarterly Report true  
Document Transition Report false  
Document Fiscal Year Focus 2020  
Document Fiscal Period Focus Q3  
Trading Symbol ACOR  
Title of each class Common Stock $0.001 par value  
Name of each exchange on which registered NASDAQ  
Entity Common Stock, Shares Outstanding   47,962,400
Entity File Number 001-31938  
Entity Incorporation, State or Country Code DE  
Entity Tax Identification Number 13-3831168  
Entity Address, Address Line One 420 Saw Mill River Road  
Entity Address, City or Town Ardsley  
Entity Address, State or Province NY  
Entity Address, Postal Zip Code 10502  
City Area Code 914  
Local Phone Number 347-4300  
v3.20.2
Consolidated Balance Sheets - USD ($)
$ in Thousands
Sep. 30, 2020
Dec. 31, 2019
Current assets:    
Cash and cash equivalents $ 57,910 $ 62,085
Restricted cash 13,200 12,836
Short term investments 5,347 63,754
Trade accounts receivable, net of allowances of $635 and $682, as of September 30, 2020 and December 31, 2019, respectively 13,385 22,083
Prepaid expenses 15,382 11,574
Inventory, net 30,120 25,221
Other current assets 16,470 3,560
Total current assets 151,814 201,113
Property and equipment, net of accumulated depreciation 139,255 142,527
Intangible assets, net of accumulated amortization 374,743 402,329
Right of use asset, net of accumulated amortization 19,805 23,450
Restricted cash 24,819 30,270
Other assets 11 29
Total assets 710,447 799,718
Current liabilities:    
Accounts payable 10,361 26,257
Accrued expenses and other current liabilities 41,430 39,077
Current portion of loans payable 68,050 603
Current portion of liability related to sale of future royalties 8,624 10,836
Current portion of lease liabilities 7,893 7,746
Current portion of acquired contingent consideration 2,391 1,866
Total current liabilities 138,749 86,385
Convertible senior notes 134,622 192,774
Derivative liability 832 59,409
Non-current portion of acquired contingent consideration 43,709 78,434
Non-current portion of lease liabilities 18,747 22,996
Non-current portion of loans payable 26,978 25,495
Deferred tax liability 23,120 9,581
Non-current portion of liability related to sale of future royalties 9,147 13,565
Other non-current liabilities 1,012 259
Commitments and contingencies
Stockholders’ equity:    
Preferred stock, $0.001 par value. Authorized 1,000,000 shares at September 30, 2020 and December 31, 2019; no shares issued as of September 30, 2020 and December 31, 2019, respectively
Common stock, $0.001 par value. Authorized 370,000,000 shares at September 30, 2020 and 80,000,000 at December 31, 2019; issued 47,734,146 and 47,730,396 shares, including those held in treasury, as of September 30, 2020 and December 31, 2019, respectively 48 48
Treasury stock at cost (29,304 shares at September 30, 2020 and December 31, 2019) (638) (638)
Additional paid-in capital 999,762 979,388
Accumulated deficit (683,355) (666,809)
Accumulated other comprehensive (loss) income (2,286) (1,169)
Total stockholders’ equity 313,531 310,820
Total liabilities and stockholders’ equity $ 710,447 $ 799,718
v3.20.2
Consolidated Balance Sheets (Parenthetical) - USD ($)
$ in Thousands
Sep. 30, 2020
Dec. 31, 2019
Statement Of Financial Position [Abstract]    
Trade accounts receivable, allowances (in dollars) $ 635 $ 682
Preferred stock, par value (in dollars per share) $ 0.001 $ 0.001
Preferred stock, Authorized shares 1,000,000 1,000,000
Preferred stock, issued shares 0 0
Common stock, par value (in dollars per share) $ 0.001 $ 0.001
Common stock, Authorized shares 370,000,000 80,000,000
Common stock, issued shares 47,734,146 47,730,396
Treasury stock, shares 29,304 29,304
v3.20.2
Consolidated Statements of Operations - USD ($)
shares in Thousands, $ in Thousands
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Revenues:        
Total net revenues $ 53,090 $ 47,722 $ 114,807 $ 141,911
Costs and expenses:        
Cost of sales 12,170 7,986 22,670 26,183
Research and development 5,729 16,073 18,689 51,060
Selling, general and administrative 39,935 48,702 119,700 151,622
Amortization of intangible assets 7,691 7,692 23,073 17,945
Asset impairment   277,561 4,131 277,561
Change in fair value of derivative liability (4,864)   (40,320)  
Changes in fair value of acquired contingent consideration (23,608) (50,942) (33,455) (56,342)
Total operating expenses 37,053 307,072 114,488 468,029
Operating income (loss) 16,037 (259,350) 319 (326,118)
Other income (expense), net:        
Interest and amortization of debt discount expense (7,760) (4,500) (22,810) (16,302)
Interest income 317 333 807 3,327
Other income (expense) 19   (16)  
Gain on disposal of property and equipment 200   200  
Realized loss on foreign currency transactions (1) (1) (8) (17)
Total other expense, net (7,225) (4,168) (21,827) (12,992)
Income (loss) before taxes 8,812 (263,518) (21,508) (339,110)
Benefit from (Provision for) income taxes (1,465) (17) 4,962 484
Net income (loss) $ 7,347 $ (263,535) $ (16,546) $ (338,626)
Net income (loss) per share—basic $ 0.15 $ (5.55) $ (0.35) $ (7.13)
Net income (loss) per share—diluted $ 0.05 $ (5.55) $ (0.35) $ (7.13)
Weighted average common shares outstanding used in computing net income (loss) per share—basic 47,705 47,511 47,704 47,491
Weighted average common shares outstanding used in computing net income (loss) per share—diluted 166,145 47,511 47,704 47,491
Net Product Revenues        
Revenues:        
Total net revenues $ 34,687 $ 44,800 $ 90,153 $ 133,325
Milestone Revenues        
Revenues:        
Total net revenues 15,000   15,000  
Royalty Revenues        
Revenues:        
Total net revenues $ 3,403 $ 2,922 $ 9,654 $ 8,586
v3.20.2
Consolidated Statements of Comprehensive Income (Loss) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Statement Of Income And Comprehensive Income [Abstract]        
Net income (loss) $ 7,347 $ (263,535) $ (16,546) $ (338,626)
Other comprehensive income (loss), net of tax:        
Foreign currency translation adjustment (1,018) (3,190) (1,096) (3,671)
Unrealized (loss) income on available for sale debt securities (45) (63) (21) 229
Other comprehensive loss, net of tax (1,063) (3,253) (1,117) (3,442)
Comprehensive income (loss) $ 6,284 $ (266,788) $ (17,663) $ (342,068)
v3.20.2
Consolidated Statements of Changes in Stockholders' Equity - USD ($)
$ in Thousands
Total
Common stock
Treasury stock
Additional paid-in capital
Accumulated deficit
Accumulated other comprehensive income
Balance at Dec. 31, 2018 $ 611,983 $ 48 $ (2,133) $ 1,005,105 $ (393,843) $ 2,806
Balance (in shares) at Dec. 31, 2018   47,508,000        
Compensation expense for issuance of stock options to employees 2,745     2,745    
Compensation expense for issuance of restricted stock to employees 922     922    
Compensation expense for issuance of restricted stock to employees (in shares)   49,000        
Exercise of stock options 24     24    
Exercise of stock options (in shares)   2,000        
Purchase of Treasury Stock (52)   (52)      
Purchase of Treasury Stock ,Shares   4,000        
Other comprehensive (loss) income,net of tax (1,431)         (1,431)
Net income (loss) (47,605)       (47,605)  
Balance at Mar. 31, 2019 566,586 $ 48 (2,185) 1,008,796 (441,448) 1,375
Balance (in shares) at Mar. 31, 2019   47,563,000        
Balance at Dec. 31, 2018 611,983 $ 48 (2,133) 1,005,105 (393,843) 2,806
Balance (in shares) at Dec. 31, 2018   47,508,000        
Net income (loss) (338,626)          
Balance at Sep. 30, 2019 281,342 $ 48 (638) 1,015,037 (732,469) (636)
Balance (in shares) at Sep. 30, 2019   47,540,000        
Balance at Mar. 31, 2019 566,586 $ 48 (2,185) 1,008,796 (441,448) 1,375
Balance (in shares) at Mar. 31, 2019   47,563,000        
Compensation expense for issuance of stock options to employees 3,180     3,180    
Compensation expense for issuance of restricted stock to employees 1,354     1,354    
Compensation expense for issuance of restricted stock to employees (in shares)   34,000        
Adjustments to Treasury Stock     1,586 (1,586)    
Adjustments to Treasury Stock (in share)   (65,000)        
Purchase of Treasury Stock (39)   (39)      
Purchase of Treasury Stock ,Shares   3,000        
Other comprehensive (loss) income,net of tax 1,242         1,242
Net income (loss) (27,486)       (27,486)  
Balance at Jun. 30, 2019 544,837 $ 48 (638) 1,011,744 (468,934) 2,617
Balance (in shares) at Jun. 30, 2019   47,535,000        
Compensation expense for issuance of stock options to employees 2,057     2,057    
Compensation expense for issuance of restricted stock to employees 1,236     1,236    
Compensation expense for issuance of restricted stock to employees (in shares)   5,000        
Other comprehensive (loss) income,net of tax (3,253)         (3,253)
Net income (loss) (263,535)       (263,535)  
Balance at Sep. 30, 2019 281,342 $ 48 (638) 1,015,037 (732,469) (636)
Balance (in shares) at Sep. 30, 2019   47,540,000        
Balance at Dec. 31, 2019 310,820 $ 48 (638) 979,388 (666,809) (1,169)
Balance (in shares) at Dec. 31, 2019   47,730,000        
Compensation expense for issuance of stock options to employees 1,976     1,976    
Compensation expense for issuance of restricted stock to employees (in shares)   4,000        
Other comprehensive (loss) income,net of tax 350         350
Net income (loss) (6,472)       (6,472)  
Balance at Mar. 31, 2020 306,674 $ 48 (638) 981,364 (673,281) (819)
Balance (in shares) at Mar. 31, 2020   47,734,000        
Balance at Dec. 31, 2019 $ 310,820 $ 48 (638) 979,388 (666,809) (1,169)
Balance (in shares) at Dec. 31, 2019   47,730,000        
Purchase of Treasury Stock ,Shares 0          
Net income (loss) $ (16,546)          
Balance at Sep. 30, 2020 313,531 $ 48 (638) 999,762 (683,355) (2,286)
Balance (in shares) at Sep. 30, 2020   47,734,000        
Balance at Mar. 31, 2020 306,674 $ 48 (638) 981,364 (673,281) (819)
Balance (in shares) at Mar. 31, 2020   47,734,000        
Compensation expense for issuance of stock options to employees 2,056     2,056    
Other comprehensive (loss) income,net of tax (404)         (404)
Net income (loss) (17,421)       (17,421)  
Balance at Jun. 30, 2020 290,905 $ 48 (638) 983,420 (690,702) (1,223)
Balance (in shares) at Jun. 30, 2020   47,734,000        
Compensation expense for issuance of stock options to employees $ 2,480     2,480    
Purchase of Treasury Stock ,Shares 0          
Reclassification of derivative liability to equity, net of tax $ 13,862     13,862    
Other comprehensive (loss) income,net of tax (1,063)         (1,063)
Net income (loss) 7,347       7,347  
Balance at Sep. 30, 2020 $ 313,531 $ 48 $ (638) $ 999,762 $ (683,355) $ (2,286)
Balance (in shares) at Sep. 30, 2020   47,734,000        
v3.20.2
Consolidated Statements of Changes in Stockholders' Equity (Parenthetical)
$ in Millions
3 Months Ended
Sep. 30, 2020
USD ($)
Statement Of Stockholders Equity [Abstract]  
Reclassification of derivative liability to equity, net of tax amount $ 4.4
v3.20.2
Consolidated Statements of Cash Flows - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended 12 Months Ended
Sep. 30, 2020
Mar. 31, 2020
Sep. 30, 2019
Mar. 31, 2019
Sep. 30, 2020
Sep. 30, 2019
Dec. 31, 2019
Cash flows from operating activities:              
Net loss $ 7,347 $ (6,472) $ (263,535) $ (47,605) $ (16,546) $ (338,626)  
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:              
Share-based compensation expense         6,512 11,494  
Amortization of net premiums and discounts on investments         (28) (1,325)  
Amortization of debt discount and debt issuance costs         12,219 12,202  
Depreciation and amortization expense         30,919 24,697  
Asset impairment     277,561   4,131 277,561  
Change in acquired contingent consideration obligation         (33,455) (56,342)  
Non-cash royalty revenue         (8,496) (7,556)  
Deferred tax provision (benefit)         8,801 (3,667)  
Change in derivative liability         (40,320)    
Gain on disposal of property and equipment (200)       (200)    
Changes in assets and liabilities:              
Decrease in accounts receivable         8,698 5,877  
(Increase) decrease in prepaid expenses and other current assets         (16,712) 13,725  
(Increase) decrease in inventory         (4,899) 1,619  
Decrease in other assets         17    
Decrease in accounts payable, accrued expenses and other current liabilities         (13,391) (56,141)  
Increase (decrease) in other non-current liabilities         296 (256)  
Net cash used in operating activities         (62,454) (116,738)  
Cash flows from investing activities:              
Purchases of property and equipment         (4,074) (76,414)  
Purchases of investments           (171,431)  
Proceeds from maturities of investments         58,415 191,342  
Net cash provided by (used in) investing activities         54,341 (56,503)  
Cash flows from financing activities:              
Debt issuance costs         (1,071)    
Proceeds from issuance of common stock and option exercises           24  
Purchase of treasury stock           (91)  
Repayment of loans payable         (597) (614)  
Net cash used in financing activities         (1,668) (681)  
Effect of exchange rate changes on cash, cash equivalents and restricted cash         519 (265)  
Net decrease in cash, cash equivalents and restricted cash         (9,262) (174,187)  
Cash, cash equivalents and restricted cash at beginning of period   $ 105,192   $ 294,351 105,192 294,351 $ 294,351
Cash, cash equivalents and restricted cash at end of period $ 95,930   $ 120,164   95,930 120,164 $ 105,192
Supplemental disclosure:              
Cash paid for interest         6,067 3,037  
Cash paid for taxes         $ 250 $ 2,562  
v3.20.2
Organization and Business Activities
9 Months Ended
Sep. 30, 2020
Organization Consolidation And Presentation Of Financial Statements [Abstract]  
Organization and Business Activities

(1) Organization and Business Activities

Acorda Therapeutics, Inc. (“Acorda” or the “Company”) is a biopharmaceutical company focused on developing therapies that restore function and improve the lives of people with neurological disorders.

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (GAAP) for interim financial information, Accounting Standards Codification (ASC) Topic 270-10 and with the instructions to Form 10-Q. Accordingly, these financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. In management’s opinion, all adjustments considered necessary for a fair presentation have been included in the interim periods presented and all adjustments are of a normal recurring nature. The Company has evaluated subsequent events through the date of this filing. Operating results for the three and nine-month periods ended September 30, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020. When used in these notes, the terms “Acorda” or “the Company” mean Acorda Therapeutics, Inc. The December 31, 2019 consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. You should read these unaudited interim condensed consolidated financial statements in conjunction with the consolidated financial statements and footnotes included in the Company's Annual Report on Form 10-K, for the year ended December 31, 2019.

v3.20.2
Summary of Significant Accounting Policies
9 Months Ended
Sep. 30, 2020
Accounting Policies [Abstract]  
Summary of Significant Accounting Policies

(2) Summary of Significant Accounting Policies

Our significant accounting policies are detailed in our Annual Report on Form 10-K for the year ended December 31, 2019. Effective January 1, 2020, the Company adopted ASU 2016-13, “Financial Instruments – Credit Losses” (Topic 326), ASU 2018-13, “Fair Value Measurement (Topic 820), ASU 2018-15, “Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract”, and, ASU 2018-18, “Collaborative Arrangements” (Topic 808). Other than the adoption of the new accounting guidance, our significant accounting policies have not changed materially from December 31, 2019.

Restricted Cash

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the statement of financial position that sum to the total of the same amounts shown in the statement of cash flows:

 

Nine-month period ended September 30, 2020

 

 

Nine-month period ended September 30, 2019

 

(In thousands)

Beginning of period

 

 

End of period

 

 

Beginning of period

 

 

End of period

 

Cash and cash equivalents

$

62,085

 

 

$

57,910

 

 

$

293,564

 

 

$

119,521

 

Restricted cash

 

12,836

 

 

 

13,200

 

 

 

532

 

 

 

387

 

Restricted cash non-current

 

30,270

 

 

 

24,819

 

 

 

255

 

 

 

256

 

Total Cash, cash equivalents and restricted cash per statement of cash flows

$

105,191

 

 

$

95,929

 

 

$

294,351

 

 

$

120,164

 

 

Amounts included in restricted cash represent those amounts in escrow related to the 6% semi-annual interest portion of the convertible note exchange completed in December 2019 payable within the next 12 months and those amounts required to be set aside to cover the Company’s self-funded employee health insurance costs over the next 12 months. Restricted cash non-current represents those amounts in escrow related to the 6% semi-annual interest portion of the convertible note exchange completed in December 2019 payable subsequent to the next twelve months and cash collateralized standby letters of credit in connection with obligations under facility leases due to the long-term nature of the letters of credit. The 6% semi-annual interest portion of the convertible notes is payable in cash or, if permitted by the terms of the notes, stock.

Inventory

The major classes of inventory were as follows:

(In thousands)

 

September 30, 2020

 

 

December 31, 2019

 

Raw materials

 

$

3,366

 

 

$

1,753

 

Work-in-progress

 

 

6,010

 

 

 

13,509

 

Finished goods

 

 

20,744

 

 

 

9,959

 

Total

 

$

30,120

 

 

$

25,221

 

The Company reviews inventory, including inventory purchase commitments, for slow moving or obsolete amounts based on expected product sales volume and provides reserves against the carrying amount of inventory as appropriate.

Foreign Currency Translation

The functional currency of operations outside the United States of America is deemed to be the currency of the local country, unless otherwise determined that the United States dollar would serve as a more appropriate functional currency given the economic operations of the entity. Accordingly, the assets and liabilities of the Company’s foreign subsidiary, Biotie, are translated into United States dollars using the period-end exchange rate; income and expense items are translated using the average exchange rate during the period; and equity transactions are translated at historical rates. Cumulative translation adjustments are reflected as a separate component of equity. Foreign currency transaction losses and gains are recognized in the period incurred and are reported as other (expense) income, net in the statement of operations.

Segment and Geographic Information

The Company is managed and operated as one business which is focused on developing therapies that restore function and improve the lives of people with neurological disorders. The entire business is managed by a single management team that reports to the Chief Executive Officer, who is the chief operating decision maker. The Company does not operate separate lines of business with respect to any of its products or product candidates and the Company does not prepare discrete financial information with respect to separate products or product candidates or by location. Accordingly, the Company views its business as one reportable operating segment. Net product revenues reported are derived from the sales of Inbrija and Ampyra in the U.S. for the three and nine-month periods ended September 30, 2020 and 2019.

Impairment of Long-Lived Assets

The Company continually evaluates whether events or circumstances have occurred that indicate that the estimated remaining useful lives of its long-lived assets, including identifiable intangible assets subject to amortization and indefinite lived intangible assets not subject to amortization and property plant and equipment, may warrant revision or that the carrying value of the assets may be impaired. Factors the Company considers important that could trigger an impairment review include significant changes in the use of any assets, changes in historical trends in operating performance, changes in projected operating performance, results of clinical trials, stock price, loss of a major customer and significant negative economic trends. Based on the Company’s evaluation for the three-month period ended March 31, 2020, the Company determined that its indefinite lived intangible asset BTT1023 was fully impaired and recorded an asset impairment in its consolidated statement of operations. The Company also determined that its finite lived intangible assets were not impaired for the three and nine-month periods ended September 30, 2020.

Liquidity

The Company assesses and determines its ability to continue as a going concern in accordance with the provisions of ASC Topic 205-40, “Presentation of Financials Statements—Going Concern” (“ASC Topic 205-40”), which requires the Company to evaluate whether there are conditions or events that raise substantial doubt about its ability to continue as a going concern within one year after the date that its annual and interim consolidated financial statements are issued. Certain additional financial statement disclosures are required if such conditions or events are identified. If and when an entity’s liquidation becomes imminent, financial statements should be prepared under the liquidation basis of accounting. Determining the extent, if any, to which conditions or events raise substantial doubt about the Company’s ability to continue

as a going concern, or the extent to which mitigating plans sufficiently alleviate any such substantial doubt, as well as whether or not liquidation is imminent, requires significant judgement by management.

The Company has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date the consolidated financial statements contained in this report are issued.

Based on our cash, cash equivalents and short-term investments at September 30, 2020, our recent net losses, and our obligations that are due within the next 12 months, including $69.0 million aggregate principal amount of our 1.75% Convertible Senior Notes due 2021 that mature on June 15, 2021, management has concluded that there is substantial doubt regarding our ability to meet our obligations within one year after the date the consolidated financial statements in this report are issued and, therefore, to continue as a going concern.

Our ability to meet our future operating requirements, repay our liabilities, meet our other obligations, and continue as a going concern are dependent upon a number of factors, including our ability to generate cash from product sales, reduce planned expenditures, and obtain additional financing. If we are unable to generate sufficient cash flow from the sale of our products, we may be required to adopt one or more alternatives, subject to the restrictions contained in the indenture governing our 6.00% Convertible Senior Secured Notes due 2024, such as further reducing expenses, selling assets, restructuring debt, or obtaining additional equity capital on terms that may be onerous and which are likely to be highly dilutive. Also, our ability to raise additional capital and repay or restructure our indebtedness will depend on the capital markets and our financial condition at such time, among other factors. In addition, financing may not be available when needed, at all, on terms acceptable to us or in accordance with the restrictions described above.

Due to these uncertainties, there is substantial doubt about the Company’s ability to continue as going concern. These unaudited condensed consolidated financial statements and accompanying notes have been prepared on the basis that the Company will continue as a going concern, and do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the possible inability of the Company to continue as a going concern.

Subsequent Events

Subsequent events are defined as those events or transactions that occur after the balance sheet date, but before the financial statements are filed with the Securities and Exchange Commission. The Company completed an evaluation of the impact of any subsequent events through the date these financial statements were issued, and determined there were no subsequent events that required disclosure in these financial statements. 

Accounting Pronouncements Adopted

In June 2016, the FASB issued ASU 2016-13, “Financial Instruments – Credit Losses” (Topic 326): Measurement of Credit Losses on Financial Instruments and subsequently amended by ASU 2019-04 and ASU 2019-05 which introduces a forward-looking approach, based on expected losses, to estimate credit losses on certain types of financial instruments, including trade receivables. This new standard amends the current guidance on the impairment of financial instruments. The ASU adds to U.S. GAAP an impairment model known as current expected credit loss (CECL) 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. The ASU is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years with early adoption permitted. The Company adopted this guidance effective January 1, 2020. The adoption of this guidance did not have a material impact on the consolidated financial statements.

In August 2018, the FASB issued ASU 2018-13 “Fair Value Measurement (Topic 820): “Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement.” The amendment in this ASU eliminate, add and modify certain disclosure requirements for fair value measurements as part of its disclosure framework project. Entities will no longer be required to disclose the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, but public business entities will be required to disclose the range and weighted average used to develop significant unobservable inputs for Level 3 fair value measurements. The ASU is effective for all entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years with early adoption permitted. The Company adopted this guidance effective January 1, 2020. The adoption of this guidance did not have a significant impact on the consolidated financial statements.

In August 2018, the FASB issued ASU 2018-15, “Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract.” The ASU clarifies certain aspects of ASU 2015-05, “Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement,” which was issued in April 2015. Specifically, the ASU 2018-15 aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license).” The ASU is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years with early adoption permitted. The Company adopted this guidance effective January 1, 2020. The adoption of this guidance did not have an impact on the consolidated financial statements.

In November 2018, the FASB issued ASU 2018-18, Collaborative arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606. ASU 2018-18 clarifies that certain transactions between participants in a collaborative arrangement should be accounted for under ASC 606 when the counterparty is a customer and precludes an entity from presenting consideration from a transaction in a collaborative arrangement as revenue from contracts with customers if the counterparty is not a customer for that transaction. The ASU is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years with early adoption permitted. The Company adopted this guidance effective January 1, 2020. The adoption of this guidance did not have a significant impact on the consolidated financial statements.

Accounting Pronouncements Not Yet Adopted

In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes. The ASU enhances and simplifies various aspects of the income tax accounting guidance in ASC 740 and removes certain exceptions for recognizing deferred taxes for investments, performing intraperiod allocation and calculating income taxes in interim periods. The ASU also adds guidance to reduce complexity in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group. This ASU is effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years with early adoption permitted. The Company is currently evaluating the impact the adoption of this guidance may have on its consolidated financial statements.

In March 2020, the FASB issued ASU 2020-03, “Codification Improvements to Financial Instruments”: The amendments in this update are to clarify, correct errors in, or make minor improvements to a variety of ASC topics. The changes in ASU 2020-03 are not expected to have a significant effect on current accounting practices. The ASU improves various financial instrument topics in the Codification to increase stakeholder awareness of the amendments and to expedite the improvement process by making the Codification easier to understand and easier to apply by eliminating inconsistencies and providing clarifications. The ASU is effective for fiscal years beginning after December 15, 2020 with early application permitted. The Company is currently evaluating the impact the adoption of this guidance may have on its consolidated financial statements.

v3.20.2
Revenue
9 Months Ended
Sep. 30, 2020
Revenue From Contract With Customer [Abstract]  
Revenue

(3) Revenue

In accordance with ASC 606, the Company recognizes revenue when the customer obtains control of a promised good or service, in an amount that reflects the consideration to which the Company expects to be entitled in exchange for the good or service. ASC 606 requires entities to record a contract asset when a performance obligation has been satisfied or partially satisfied, but the amount of consideration has not yet been received because the receipt of the consideration is conditioned on something other than the passage of time. ASC 606 also requires an entity to present a revenue contract as a contract liability in instances when a customer pays consideration, or an entity has a right to an amount of consideration that is unconditional (e.g. receivable), before the entity transfers a good or service to the customer. We did not have any contract assets or any contract liabilities as of September 30, 2020 and 2019.

The following table disaggregates our revenue by major source:

 

(In thousands)

Three-month period ended September 30, 2020

 

 

Three-month period ended September 30, 2019

 

 

Nine-month period ended September 30, 2020

 

 

Nine-month period ended September 30, 2019

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net product revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ampyra

$

27,343

 

 

$

39,322

 

 

$

73,546

 

 

$

123,579

 

Inbrija

 

5,833

 

 

 

4,889

 

 

 

14,901

 

 

 

9,164

 

Other

 

1,511

 

 

 

589

 

 

 

1,706

 

 

 

582

 

Total net product revenues

 

34,687

 

 

 

44,800

 

 

 

90,153

 

 

 

133,325

 

Milestone revenues

 

15,000

 

 

 

 

 

 

15,000

 

 

 

 

Royalty revenues

 

3,403

 

 

 

2,922

 

 

 

9,654

 

 

 

8,586

 

Total net revenues

$

53,090

 

 

$

47,722

 

 

$

114,807

 

 

$

141,911

 

 

v3.20.2
Share-based Compensation
9 Months Ended
Sep. 30, 2020
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]  
Share-based Compensation

(4) Share-based Compensation

During the three‑month periods ended September 30, 2020 and 2019, the Company recognized share-based compensation expense of $2.5 million and $3.3 million, respectively. During the nine-month periods ended September 30, 2020 and 2019, the Company recognized share-based compensation expense of $6.5 million and $11.5 million, respectively. Activity in options and restricted stock during the nine-month period ended September 30, 2020 and related balances outstanding as of that date are reflected below. The weighted average fair value per share of options granted to employees for the three-month periods ended September 30, 2020 and 2019 were approximately $0.39 and $2.69, respectively. The weighted average fair value per share of options granted to employees for the nine-month periods ended September 30, 2020 and 2019 were approximately $0.66 and $6.49, respectively.

The following table summarizes share-based compensation expense included within the consolidated statements of operations:

 

 

 

For the three-month period ended September 30,

 

 

For the nine-month period ended September 30,

 

(In thousands)

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Research and development expense

 

$

555

 

 

$

719

 

 

$

1,418

 

 

$

2,203

 

Selling, general and administrative expense

 

 

1,832

 

 

 

2,424

 

 

 

4,834

 

 

 

8,785

 

Cost of Sales

 

 

93

 

 

 

149

 

 

 

260

 

 

 

505

 

Total

 

$

2,480

 

 

$

3,292

 

 

$

6,512

 

 

$

11,493

 

 

A summary of share-based compensation activity for the nine-month period ended September 30, 2020 is presented below:

Stock Option Activity

 

 

 

Number of

Shares

(In thousands)

 

 

Weighted

Average

Exercise

Price

 

 

Weighted

Average

Remaining

Contractual

Term

 

 

Intrinsic

Value

(In thousands)

 

Balance at January 1, 2020

 

 

10,469

 

 

$

22.96

 

 

 

 

 

 

 

 

 

Granted

 

 

237

 

 

 

1.00

 

 

 

 

 

 

 

 

 

Cancelled

 

 

(2,339

)

 

 

27.41

 

 

 

 

 

 

 

 

 

Exercised

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at September 30, 2020

 

 

8,366

 

 

$

21.09

 

 

 

6.0

 

 

$

 

Vested and expected to vest at

    September 30, 2020

 

 

8,342

 

 

$

21.14

 

 

 

6.0

 

 

$

 

Vested and exercisable at

    September 30, 2020

 

 

6,482

 

 

$

25.72

 

 

 

4.7

 

 

$

 

Restricted Stock and Performance Stock Unit Activity

 

(In thousands)

 

 

 

 

Restricted Stock and Performance Stock Units

 

Number of Shares

 

Nonvested at January 1, 2020

 

 

425

 

Granted

 

 

 

Vested

 

 

(4

)

Forfeited

 

 

(60

)

Nonvested at September 30, 2020

 

 

361

 

 

Unrecognized compensation cost for unvested stock options, restricted stock awards and performance stock units as of September 30, 2020 totaled $7.8 million and is expected to be recognized over a weighted average period of approximately 1.4 years.

During the three and nine‑month periods ended September 30, 2020, the Company did not make any repurchases of shares.

v3.20.2
Income (Loss) Per Share
9 Months Ended
Sep. 30, 2020
Earnings Per Share [Abstract]  
Income (Loss) Per Share

(5) Income (Loss) Per Share

The following table sets forth the computation of basic and diluted loss per share for the three and nine-month periods ended September 30, 2020 and 2019:

 

(In thousands, except per share data)

 

Three-month period ended September 30, 2020

 

 

Three-month period ended September 30, 2019

 

 

Nine-month period ended September 30, 2020

 

 

Nine-month period ended September 30, 2019

 

Basic and diluted

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)—basic

 

$

7,347

 

 

$

(263,535

)

 

$

(16,546

)

 

$

(338,626

)

Plus: Dilutive effect of convertible notes, net of tax

 

 

1,476

 

 

 

 

 

 

 

 

 

 

Net income (loss)—diluted

 

$

8,823

 

 

$

(263,535

)

 

$

(16,546

)

 

$

(338,626

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding used in

   computing net income (loss) per share—basic

 

 

47,705

 

 

 

47,511

 

 

 

47,704

 

 

 

47,491

 

Plus: Dilutive effect of convertible notes

 

 

118,440

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding used in

   computing net income (loss) per share—diluted

 

 

166,145

 

 

 

47,511

 

 

 

47,704

 

 

 

47,491

 

Net income (loss) per share—basic

 

$

0.15

 

 

$

(5.55

)

 

$

(0.35

)

 

$

(7.13

)

Net income (loss) per share—diluted

 

$

0.05

 

 

$

(5.55

)

 

$

(0.35

)

 

$

(7.13

)

 

Securities that could potentially be dilutive are excluded from the computation of diluted loss per share when a loss from continuing operations exists or when the exercise price exceeds the average closing price of the Company’s common stock during the period, because their inclusion would result in an anti-dilutive effect on per share amounts.

The following amounts were not included in the calculation of net loss per diluted share because their effects were anti-dilutive:

 

(In thousands)

 

Three-month period ended September 30, 2020

 

 

Three-month period ended September 30, 2019

 

 

Nine-month period ended September 30, 2020

 

 

Nine-month period ended September 30, 2019

 

Denominator

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock options and restricted common shares

 

 

8,784

 

 

 

8,988

 

 

 

8,532

 

 

 

8,968

 

 

Performance share units are excluded from the calculation of net loss per diluted share as the performance criteria has not been met for the three and nine-month periods ended September 30, 2020 and 2019. Additionally, for the three and nine-month periods ended September 30, 2020, the impact of our outstanding convertible notes was determined to be dilutive and anti-dilutive, respectively. As a result, for the three-month period ended September 30, 2020 the Company adjusted the

numerator amount used in the calculation of net income per diluted share to add back the interest expense associated with convertible notes of $6.8 million, which is partially offset by the derivative liability gain of $4.9 million and $0.5 tax impact. Additionally, the 118,440 million common shares required to fully convert the outstanding convertible notes were included and excluded from the denominator in the calculation of net loss per diluted share under the if converted method for the three and nine-month periods ended September 30, 2020, respectively.

v3.20.2
Income Taxes
9 Months Ended
Sep. 30, 2020
Income Tax Disclosure [Abstract]  
Income Taxes

(6) Income Taxes

On March 27, 2020, the CARES Act was signed into law, which enacted several tax favorable, business-related provisions. The Company reviewed the enacted provisions to determine which provisions should be considered for the three-month period ended September 30, 2020. Under the new law, the CARES Act provides that NOLs arising in a taxable year beginning after December 31, 2017, and before January 1, 2021, can be carried back to each of the five taxable years preceding the taxable year of such loss. The Company has considered the impact to the tax provision for the carryback of net operating losses to prior periods of taxable income incurred within the period allowed under the CARES Act. The result of carrying back these losses allowed the Company to realize certain deferred tax assets and a corresponding release of the valuation allowance of approximately $1.8 million. In July 2020, the Company received an income tax refund of $12.7 million including interest from the Internal Revenue Service, related to the 2019 net operating loss carryback. The Company recorded a tax receivable of $1.4 million for the anticipated 2020 net operating loss carryback claim as of September 30, 2020.

The Company’s effective income tax rate differs from the U.S. statutory rate primarily due to an increase in the valuation allowance, and expense recorded on the equity forfeitures, offset by the benefit of net operating loss carryback under the CARES act recorded at 21% to recover taxes paid at the previous statutory rate of 35%.

For the three-month periods ended September 30, 2020 and 2019, the Company recorded a provision of $(1.5) million and $(0.02) million for income taxes, respectively. The effective income tax rates for the Company for the three-month periods ended September 30, 2020 and 2019 were 16.6% and 0%, respectively. The variances in the effective tax rates for the three-month period ended September 30, 2020 as compared to the three-month period ended September 30, 2019 was due primarily to the valuation allowance recorded on deferred tax assets for which no tax benefit can be recognized, goodwill impairment for which no tax benefit can be recognized, and the benefit recorded on the net operating loss carryback under the CARES act recorded at 21% to recover taxes paid at the previous statutory rate of 35%.

For the nine-month periods ended September 30, 2020 and 2019, the Company recorded a benefit of $5.0 million and $0.5 million for income taxes, respectively. The effective income tax rates for the Company for the nine-month periods ended September 30, 2020 and 2019 were 23.1% and 0.14%, respectively. The variance in effective tax rates for the nine-month period ended September 30, 2020 as compared to the nine-month period ended September 30, 2019 was due primarily to the valuation allowance recorded on deferred tax assets for which no tax benefit can be recognized, goodwill impairment for which no tax benefit can be recognized, and the benefit recorded on the net operating loss carryback under the CARES act recorded at 21% to recover taxes paid at the previous statutory rate of 35%.

The Company continues to evaluate the realizability of its deferred tax assets on a quarterly basis and will adjust such amounts in light of changing facts and circumstances including, but not limited to, future projections of taxable income, tax legislation, rulings by relevant tax authorities, the progress of ongoing tax audits and the regulatory approval of products currently under development. Any changes to the valuation allowance or deferred tax assets and liabilities in the future would impact the Company's income taxes.

The Company’s state examination by the state of Massachusetts for the tax periods 2016 and 2017 was completed during the period ended September 30, 2020. The Company was assessed a tax of approximately $0.2 million.

The Company has ongoing state examinations in New Jersey and Minnesota which cover a range of tax periods, 2015 – 2018. There have been no proposed adjustments at this stage of the examinations.

v3.20.2
Fair Value Measurements
9 Months Ended
Sep. 30, 2020
Fair Value Disclosures [Abstract]  
Fair Value Measurements

(7) Fair Value Measurements

The following table presents information about the Company’s assets and liabilities measured at fair value on a recurring basis as of September 30, 2020 and December 31, 2019 and indicates the fair value hierarchy of the valuation techniques utilized to determine such fair value. In general, fair values determined by Level 1 inputs utilize quoted prices

(unadjusted) in active markets for identical assets or liabilities. Fair values determined by Level 2 inputs utilize data points that are observable, such as quoted prices, interest rates, exchange rates and yield curves. Fair values determined by Level 3 inputs utilize unobservable data points for the asset or liability. The Company’s Level 1 assets consist of investments in a Treasury money market fund and U.S. government securities. The Company’s level 2 assets consist of investments in corporate bonds and commercial paper which are categorized as short-term investments for investments with original maturities between three months and one year. The Company’s Level 3 liabilities represent acquired contingent consideration related to the acquisition of Civitas which are valued using a probability weighted discounted cash flow valuation approach and derivative liabilities related to conversion options for the convertible senior notes due December 2024 which are valued using a binomial model. For assets and liabilities not accounted for at fair value, the carrying values of these accounts approximates their fair values at September 30, 2020, except for the fair value of the Company’s convertible senior notes due June 2021, which was approximately $55.3 million and the fair value of the Company’s convertible senior notes due December 2024, which was approximately $119.3 million as of September 30, 2020. The Company estimates the fair value of its notes utilizing market quotations for the debt (Level 2).

 

(In thousands)

 

Level 1

 

 

Level 2

 

 

Level 3

 

September 30, 2020

 

 

 

 

 

 

 

 

 

 

 

 

Assets Carried at Fair Value:

 

 

 

 

 

 

 

 

 

 

 

 

Money market funds

 

$

31,283

 

 

$

 

 

$

 

Corporate bonds

 

 

 

 

 

5,347

 

 

 

 

Liabilities Carried at Fair Value:

 

 

 

 

 

 

 

 

 

 

 

 

Derivative liability - conversion option

 

 

 

 

 

 

 

 

832

 

Acquired contingent consideration

 

 

 

 

 

 

 

 

46,100

 

December 31, 2019

 

 

 

 

 

 

 

 

 

 

 

 

Assets Carried at Fair Value:

 

 

 

 

 

 

 

 

 

 

 

 

Money market funds

 

$

2,219

 

 

$

 

 

$

 

Commercial paper

 

 

 

 

 

26,569

 

 

 

 

Corporate bonds

 

 

 

 

 

37,185

 

 

 

 

Liabilities Carried at Fair Value:

 

 

 

 

 

 

 

 

 

 

 

 

Derivative liability - conversion option

 

 

 

 

 

 

 

 

59,409

 

Acquired contingent consideration

 

 

 

 

 

 

 

 

80,300

 

 

The following table presents additional information about liabilities measured at fair value on a recurring basis and for which the Company utilizes Level 3 inputs to determine fair value.

Acquired contingent consideration

 

(In thousands)

 

Three-month period ended September 30, 2020

 

 

Three-month period ended September 30, 2019

 

 

Nine-month period ended September 30, 2020

 

 

Nine-month period ended September 30, 2019

 

Acquired contingent consideration:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, beginning of period

 

$

70,000

 

 

$

162,537

 

 

$

80,300

 

 

$

168,000

 

Fair value change to contingent consideration

   included in the statement of operations

 

 

(23,608

)

 

 

(50,942

)

 

 

(33,455

)

 

 

(56,342

)

Royalty payments

 

 

(292

)

 

 

(395

)

 

 

(745

)

 

 

(458

)

Balance, end of period

 

$

46,100

 

 

$

111,200

 

 

$

46,100

 

 

$

111,200

 

 

The Company estimates the fair value of its acquired contingent consideration using a probability weighted discounted cash flow valuation approach based on estimated future sales expected from Inbrija (levodopa inhalation powder), an FDA approved drug for the treatment of OFF periods in Parkinson’s disease. Using this approach, expected probability adjusted future cash flows are calculated over the expected life of the agreement and discounted to estimate the current value of the liability at the period end date. Some of the more significant assumptions made in the valuation include (i) the estimated revenue forecast for Inbrija, (ii) probabilities of success, and (iii) discount periods and rate. The milestone payments ranged from $1.0 million to $22.0 million for Inbrija. The estimated revenue forecast for Inbrija is based on peak annual sales of $300 to $500 million. The discount rate used in the valuation was 20.5% for the three and nine-month periods ended September 30, 2020. The valuation is performed quarterly and changes in the fair value of the contingent consideration are included in the statement of operations. For the three and nine-month periods ended September 30, 2020 and 2019, changes in the fair value of the acquired contingent consideration were primarily due to updates to certain revenue and expense forecast assumptions. Additionally, for the nine-month periods ended September 30, 2020 and 2019, changes in the fair value of the acquired contingent consideration were partially offset by a reduction in the discount rate and a reduction in the forecast periods for the passage of time.

The acquired contingent consideration is classified as a Level 3 liability as its valuation requires substantial judgment and estimation of factors that are not currently observable in the market. If different assumptions were used for the various inputs to the valuation approach, including but not limited to, assumptions involving sales estimates for Inbrija and estimated discount rates, the estimated fair value could be significantly higher or lower than the fair value determined.

Derivative Liability-Conversion Option

The following table represents a reconciliation of the derivative liability recorded in connection with the issuance of the convertible senior secured notes due 2024 acquired:

(In thousands)

September 30, 2020

 

 

June 30, 2020

 

 

March 31, 2020

 

 

December 31, 2019

 

Derivative Liability-Conversion Option

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, beginning of period

$

23,953

 

 

$

32,881

 

 

$

59,409

 

 

$

 

Fair value recognized upon issuance of Convertible Senior Notes

 

 

 

 

 

 

 

 

 

 

59,409

 

Fair value adjustment

 

(4,864

)

 

 

(8,928

)

 

 

(26,528

)

 

 

 

Fair value re-classification to shareholder's equity

 

(18,257

)

 

 

 

 

 

 

 

 

 

Balance, end of period

$

832

 

 

$

23,953

 

 

$

32,881

 

 

$

59,409

 

During 2019, a derivative liability was initially recorded as a result of the issuance of the 6.00% Convertible Senior Secured Notes due 2024 (see Note 10). The fair value measurement of the derivative liability is classified as Level 3 under the fair value hierarchy as it has been valued using certain unobservable inputs. These inputs include: (1) share price as of the valuation date, (2) assumed timing of conversion of the Notes, (3) historical volatility of the share price, and (4) the risk-adjusted discount rate used to present value the probability-weighted cash flows. Significant increases or decreases in any of those inputs in isolation could result in a significantly lower or higher fair value measurement. The fair value of the derivative liability as of September 30, 2020 was determined using a binomial model that calculates the fair value of the Notes with the conversion feature as compared to the fair value of the Notes without the conversion feature, with the difference representing the value of the conversion feature, or the derivative liability. There are several embedded features within the Notes which, upon issuance, did not meet the conditions for equity classification. As a result, these features were aggregated together and recorded as a derivative liability conversion option. The derivative liability conversion feature is measured at fair value on a quarterly basis and changes in the fair value will be recorded in the consolidated statement of operations. The Company received stockholder approval on August 28, 2020 to increase the number of authorized shares of the Company’s common stock from 80,000,000 shares to 370,000,000 shares. As a result of the share approval, the Company determined that multiple embedded conversion options met the conditions for equity classification. The Company performed a valuation of these conversion options as of September 17, 2020, which was the date the Company completed certain securities registration obligations. The valuation of these conversion options was based on key assumptions including the Company’s stock price of $0.58, the historical volatility rate of 113.0%, and risk-adjusted discount rate of 25.0%. The resulting fair value of these conversion options was calculated to be  $18.3 million which was reclassified to equity and presented in the statement of stockholder’s equity as of September 30, 2020 net of the $(4.4) million tax impact. The fair value of the derivative liability related to certain embedded conversion features that are precluded from equity classification for the nine-month period ended September 30, 2020 were determined based on key assumption including the Company’s

stock price of $0.52, the historical volatility rate of 115.0%, and the risk-adjusted discount rate of 25.3%. The fair value of this conversion feature was calculated to be $0.8 million.

v3.20.2
Investments
9 Months Ended
Sep. 30, 2020
Investments Debt And Equity Securities [Abstract]  
Investments

(8) Investments

The Company has determined that all of its investments are classified as available-for-sale. Available-for-sale debt securities are carried at fair value with interest on these investments included in interest income and are recorded based on quoted market prices. Available-for-sale investments consisted of the following at September 30, 2020 and December 31, 2019, respectively:

 

 

 

 

 

 

 

Gross

 

 

Gross

 

 

Estimated

 

 

 

Amortized

 

 

Unrealized

 

 

Unrealized

 

 

Fair

 

(In thousands)

 

Cost

 

 

Gains

 

 

Losses

 

 

Value

 

September 30, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate Bonds

 

 

5,341

 

 

 

6

 

 

 

-

 

 

 

5,347

 

Total Short-term investments

 

$

5,341

 

 

$

6

 

 

$

-

 

 

$

5,347

 

December 31, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial Paper

 

$

26,550

 

 

$

19

 

 

$

 

 

$

26,569

 

Corporate Bonds

 

 

37,177

 

 

 

20

 

 

 

(12

)

 

 

37,185

 

Total Short-term investments

 

$

63,727

 

 

$

39

 

 

$

(12

)

 

$

63,754

 

 

Short-term investments with maturities of three months or less from date of purchase have been classified as cash equivalents, and amounted to approximately $31.3 million and $2.2 million as of September 30, 2020 and December 31, 2019, respectively. Short-term investments have original maturities of greater than 3 months but less than 1 year and amounted to approximately $5.3 million and $63.8 million as of September 30, 2020 and December 31, 2019, respectively. The aggregate fair value of short-term investments in an unrealized loss position amounted to approximately $0 and $25.5 million as of September 30, 2020 and December 31, 2019, respectively. Short-term investments at September 30, 2020 primarily consisted of high-grade commercial paper and corporate bonds. Long-term investments have original maturities of greater than 1 year. There were no investments classified as long-term at September 30, 2020 or December 31, 2019. The Company has determined that there were no other-than-temporary declines in the fair values of its investments as of September 30, 2020 as the Company does not intend to sell its investments and it is not more likely than not that the Company will be required to sell its investments prior to the recovery of its amortized cost basis.

Unrealized holding gains and losses, which relate to debt instruments, are reported within accumulated other comprehensive income (AOCI) in the statements of comprehensive income. The changes in AOCI associated with the unrealized holding gains on available-for-sale investments during the nine-month period ended September 30, 2020, were as follows (in thousands):

 

(In thousands)

 

Net Unrealized Gains (Losses) on Marketable Securities

 

Balance at December 31, 2019

 

$

27

 

Other comprehensive income before reclassifications:

 

 

 

 

Amounts reclassified from accumulated other comprehensive income

 

 

 

Net current period other comprehensive loss

 

 

(21

)

Balance at September 30, 2020

 

$

6

 

 

v3.20.2
Liability Related to Sale of Future Royalties
9 Months Ended
Sep. 30, 2020
Deferred Revenue Disclosure [Abstract]  
Liability Related to Sale of Future Royalties

(9) Liability Related to Sale of Future Royalties

As of October 1, 2017, the Company completed a royalty purchase agreement with HealthCare Royalty Partners, or HCRP (“Royalty Agreement”). In exchange for the payment of $40 million to the Company, HCRP obtained the right to receive Fampyra royalties payable by Biogen under the License and Collaboration Agreement between the Company and

Biogen, up to an agreed upon threshold of royalties. When this threshold is met, if ever, the Fampyra royalties will revert back to the Company and the Company will continue to receive the Fampyra royalties from Biogen until the revenue stream ends. The transaction does not include potential future milestones to be paid.

The Company maintained the rights under the license and collaboration agreement with Biogen, therefore, the Royalty Agreement has been accounted for as a liability that will be amortized using the effective interest method over the life of the arrangement, in accordance with the relevant accounting guidance. The Company recorded the receipt of the $40 million payment from HCRP and established a corresponding liability in the amount of $40 million, net of transaction costs of approximately $2.2 million. The net liability is classified between the current and non-current portion of liability related to the sale of future royalties in the consolidated balance sheets based on the recognition of the interest and principal payments to be received by HCRP in the next 12 months from the financial statement reporting date. The total net royalties to be paid, less the net proceeds received will be recorded to interest expense using the effective interest method over the life of the Royalty Agreement. The Company will estimate the payments to be made to HCRP over the term of the Agreement based on forecasted royalties and will calculate the interest rate required to discount such payments back to the liability balance. Over the course of the Royalty Agreement, the actual interest rate will be affected by the amount and timing of net royalty revenue recognized and changes in forecasted revenue. On a quarterly basis, the Company will reassess the effective interest rate and adjust the rate prospectively as necessary.

The following table shows the activity within the liability account for September 30, 2020 and December 31, 2019, respectively:

 

(In thousands)

 

Nine-month period ended September 30, 2020

 

 

Twelve-month period ended December 31, 2019

 

Liability related to sale of future royalties - beginning balance

 

$

24,401

 

 

$

30,716

 

Deferred transaction costs recognized

 

 

318

 

 

 

639

 

Non-cash royalty revenue payable to HCRP

 

 

(8,496

)

 

 

(10,271

)

Non-cash interest expense recognized

 

 

1,548

 

 

 

3,317

 

Liability related to sale of future royalties - ending balance

 

$

17,771

 

 

$

24,401

 

 

 

 

 

 

 

 

 

 

 

v3.20.2
Debt
9 Months Ended
Sep. 30, 2020
Debt Disclosure [Abstract]  
Debt

(10) Debt

Convertible Senior Secured Notes Due 2024

On December 24, 2019, the Company completed the private exchange of $276.0 million aggregate principal amount of its outstanding 1.75% Convertible Senior Notes due 2021 (the “2021 Notes”) for a combination of newly-issued 6.00% Convertible Senior Secured Notes due 2024 (the “2024 Notes”) and cash. For each $1,000 principal amount of exchanged 2021 Notes, the Company issued $750 principal amount of the 2024 Notes and made a cash payment of $200 (the “Exchange”). In the aggregate, the Company issued approximately $207.0 million aggregate principal amount of the 2024 Notes and paid approximate $55.2 million in cash to participating holders. The Exchange was conducted with a limited number of institutional holders of the 2021 Notes pursuant to Exchange Agreements dated as of December 20, 2019 (each, an “Exchange Agreement”).

The 2024 Notes were issued pursuant to an Indenture, dated as of December 23, 2019, among the Company, its wholly owned subsidiary, Civitas Therapeutics, Inc. (along with any domestic subsidiaries acquired or formed after the date of issuance, the “Guarantors”), and Wilmington Trust, National Association, as trustee and collateral agent (the “Indenture”). The 2024 Notes are senior obligations of the Company and the Guarantors, secured by a first priority security interest in substantially all of the assets of the Company and the Guarantors, subject to certain exceptions described in the Security Agreement, dated as of December 23, 2019, between the grantors party thereto and Wilmington Trust, National Association, as collateral agent (the “Security Agreement”).

The 2024 Notes will mature on December 1, 2024 unless earlier converted in accordance with their terms prior to such date. Interest on the 2024 Notes will be payable semi-annually in arrears at a rate of 6.00% per annum on each June 1 and December 1, beginning on June 1, 2020. The Company may elect to pay interest in cash or shares of the Company’s common stock, subject to the satisfaction of certain conditions. If the Company elects to pay interest in shares of common stock, such common stock will have a per share value equal to 95% of the daily volume-weighted average price for the 10 trading days ending on and including the trading day immediately preceding the relevant interest payment date.

The 2024 Notes will be convertible at the option of the holder into shares of common stock of the Company at any time prior to the close of business on the second scheduled trading day immediately preceding the maturity date. The initial conversion rate for the 2024 Notes is 285.7142 shares of the Company’s common stock per $1,000 principal amount of 2024 Notes, representing an initial conversion price of approximately $3.50 per share of common stock. The conversion rate is subject to adjustment in certain circumstances as described in the Indenture.

The Company may elect to settle conversions of the 2024 Notes in cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock. Holders who convert their 2024 Notes prior to June 1, 2023 (other than in connection with a make-whole fundamental change) will also be entitled to an interest make-whole payment equal to the sum of all regularly scheduled stated interest payments, if any, due on such 2024 Notes on each interest payment date occurring after the conversion date for such conversion and on or before June 1, 2023. In addition, the Company will have the right to cause all 2024 Notes then outstanding to be converted automatically if the volume-weighted average price per share of the Company’s common stock equals or exceeds 130% of the conversion price for a specified period of time and certain other conditions are satisfied.

Holders of the 2024 Notes will have the right, at their option, to require the Company to purchase their 2024 Notes if a fundamental change (as defined in the Indenture) occurs, in each case, at a repurchase price equal to 100% of the principal amount of the 2024 Notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the applicable repurchase date.

Subject to a number of exceptions and qualifications, the Indenture restricts the ability of the Company and certain of its subsidiaries to, among other things, (i) pay dividends or make other payments or distributions on their capital stock, or purchase, redeem, defease or otherwise acquire or retire for value any capital stock, (ii) make certain investments, (iii) incur indebtedness or issue preferred stock, other than certain forms of permitted debt, which includes, among other items, indebtedness incurred to refinance the 2021 Notes, (iv) create liens on their assets, (v) sell their assets, (vi) enter into certain transactions with affiliates or (vii) merge, consolidate or sell of all or substantially all of their assets. The Indenture also requires the Company to make an offer to repurchase the 2024 Notes upon the occurrence of certain asset sales.

The Indenture provides that a number of events will constitute an event of default, including, among other things, (i) a failure to pay interest for 30 days, (ii) failure to pay the 2024 Notes when due at maturity, upon any required repurchase, upon declaration of acceleration or otherwise, (iii) failure to convert the 2024 Notes in accordance with the Indenture and the failure continues for five business days, (iv) not issuing certain notices required by the Indenture within a timely manner, (v) failure to comply with the other covenants or agreements in the Indenture for 60 days following the receipt of a notice of non-compliance, (vi) a default or other failure by the Company to make required payments under other indebtedness of the Company or certain subsidiaries having an outstanding principal amount of $30.0 million or more, (vii) failure by the Company or certain subsidiaries to pay final judgments aggregating in excess of $30.0 million, (viii) certain events of bankruptcy or insolvency and (ix) the commercial launch in the United States of a product determined by the U.S. FDA to be bioequivalent to Inbrija. In the case of an event of default arising from certain events of bankruptcy or insolvency with respect to the Company, all outstanding 2024 Notes will become due and payable immediately without further action or notice. If any other event of default occurs and is continuing, the trustee or the holders of at least 25% in aggregate principal amount of the then outstanding 2024 Notes may declare all the notes to be due and payable immediately.

The 2021 Notes received by the Company in the Exchange have been cancelled in accordance with their terms. Accordingly, upon completion of the Exchange, $69.0 million of the 2021 Notes remained outstanding.

The Company determined that the exchange of the 2021 Notes for 2024 Notes qualified for a debt extinguishment and recognized a gain on extinguishment of $55.1 million for the year ended December 31, 2019, representing the difference between the fair value of the liability component immediately before the exchange and the carrying value of the debt. The Company recorded an adjustment of $38.4 million to additional paid-in capital to adjust the equity component of 2021 Notes in connection with the extinguishment.

The Company assessed all terms and features of the 2024 Notes in order to identify any potential embedded features that would require bifurcation. As part of this analysis, the Company assessed the economic characteristics and risks of the 2024 Notes, including the conversion, put and call features. The Company concluded the conversion feature required bifurcation as a derivative. The fair value of the conversion feature derivative was determined based on the difference between the fair value of the 2024 Notes with the conversion option and the fair value of the 2024 Notes without the conversion option using a binomial model. The Company determined that the fair value of the derivative upon issuance of the 2024 Notes was $59.4 million and recorded this amount as a derivative liability with an offsetting amount as a debt discount

as a reduction to the carrying value of the Notes on the closing date, or December 24, 2019. There are several embedded features within the Notes which, upon issuance, did not meet the conditions for equity classification. As a result, these features were aggregated together and recorded as the derivative liability conversion option. The conversion feature is measured at fair value on a quarterly basis and changes in the fair value of the conversion feature for the period will be recognized in the consolidated statements of operations. The Company performed a valuation of the derivative liability for the period ended September 30, 2020 and determined that the fair value of the derivative liability was $19.1 million representing a change of $4.9 million that is recognized in the consolidated statement of operations for the three-month period ended September 30, 2020.

The Company received stockholder approval on August 28, 2020 to increase the number of authorized shares of the Company’s common stock from 80,000,000 shares to 370,000,000 shares. As a result of the share approval, the Company determined that multiple embedded conversion options met the conditions for equity classification. The Company performed a valuation of these conversion options for the period ended September 30, 2020 and determined the fair value was $18.3 million, which was reclassified to equity and presented in the statement of stockholder’s equity as of September 30, 2020, net of the $(4.4) million tax impact. The equity component is not re-measured as long as it continues to meet the conditions for equity classification. The Company performed a valuation of the derivative liability related to certain embedded conversion features that are precluded from equity classification. The fair value of these conversion features was calculated to be $0.8 million as of September 30, 2020.

The outstanding New Note balance as of September 30, 2020 and December 31, 2019 consisted of the following:

 

(In thousands)

 

September 30, 2020

 

 

December 31, 2019

 

Liability component:

 

 

 

 

 

 

 

 

Principal

 

 

207,000

 

 

$

207,000

 

Less: debt discount and debt issuance costs, net

 

 

(72,378

)

 

 

(80,028

)

Net carrying amount

 

$

134,622

 

 

$

126,972

 

Equity component

 

$

18,257

 

 

$

 

Derivative liability-conversion option

 

$

832

 

 

$

59,409

 

 

The Company determined that the expected life of the 2024 Notes was equal to the period through December 1, 2024 as this represents the point at which the 2024 Notes will mature unless earlier converted in accordance with their terms prior to such date. Accordingly, the total debt discount of $75.1 million, inclusive of the fair value of the embedded derivative conversion feature at issuance, is being amortized using the effective interest method through December 1, 2024. For the three and nine-month periods ended September 30, 2020, the Company recognized $6.0 million and $17.5 million, respectively, of interest expense related to the 2024 Notes at the effective interest rate of 18.1%. The fair value of the Company’s 2024 Notes was approximately $119.3 million as of September 30, 2020.

In connection with the issuance of the Notes, the Company incurred approximately $5.7 million of debt issuance costs, which primarily consisted of underwriting, legal and other professional fees, and allocated these costs to the liability component and recorded as a reduction in the carrying amount of the debt liability on the balance sheet. The portion allocated to the 2024 Notes is amortized to interest expense over the expected life of the 2024 Notes using the effective interest method.

The following table sets forth total interest expense recognized related to the Notes for the three and nine-month periods ended September 30, 2020:

 

(In thousands)

 

Three-month period ended September 30, 2020

 

 

Nine-month period ended September 30, 2020

 

Contractual interest expense

 

$

3,105

 

 

$

9,315

 

Amortization of debt issuance costs

 

 

204

 

 

 

585

 

Amortization of debt discount

 

 

2,663

 

 

 

7,647

 

Total interest expense

 

$

5,972

 

 

$

17,547

 

 

Convertible Senior Notes Due 2021

On June 17, 2014, the Company issued $345 million aggregate principal amount of 1.75% Convertible Senior Notes due 2021 (the 2021 Notes) in an underwritten public offering. The net proceeds from the offering were $337.5 million after deducting the Underwriter’s discount and offering expenses paid by the Company. On December 24, 2019, the Company completed the private exchange of $276.0 million aggregate principal amount of its outstanding 2021 Notes for a combination of newly-issued 6.00% Convertible Senior Secured Notes due 2024 (the “2024 Notes”) and cash. The 2021 Notes received by the Company in the exchange have been cancelled in accordance with their terms. Accordingly, upon completion of the exchange, $69.0 million of the 2021 Notes remained outstanding.

The 2021 Notes are convertible into cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, at the Company’s election, under certain circumstances as outlined in the indenture, based on an initial conversion rate, subject to adjustment, of 23.4968 shares per $1,000 principal amount of the 2021 Notes (representing an initial conversion price of approximately $42.56 per share).

The Company may redeem for cash all or part of the 2021 Notes, at the Company’s option, after June 20, 2017, under certain circumstances as outlined in the indenture.

The Company pays 1.75% interest per annum on the principal amount of the 2021 Notes, payable semiannually in arrears in cash on June 15 and December 15 of each year. The 2021 Notes will mature on June 15, 2021.

If the Company undergoes a “fundamental change” (as defined in the Indenture), subject to certain conditions, holders may require the Company to repurchase for cash all or part of their 2021 Notes in principal amounts of $1,000 or an integral multiple thereof. The Indenture contains customary terms and covenants and events of default. If an event of default (other than certain events of bankruptcy, insolvency or reorganization involving the Company) occurs and is continuing, the Trustee by notice to the Company, or the holders of at least 25% in principal amount of the outstanding 2021 Notes by notice to the Company and the Trustee, may declare 100% of the principal of and accrued and unpaid interest, if any, on all the 2021 Notes to be due and payable. Upon such a declaration of acceleration, such principal and accrued and unpaid interest, if any, will be due and payable immediately. Upon the occurrence of certain events of bankruptcy, insolvency or reorganization involving the Company, 100% of the principal and accrued and unpaid interest, if any, on all of the 2021 Notes will become due and payable automatically. Notwithstanding the foregoing, the Indenture provides that, to the extent the Company elects and for up to 270 days, the sole remedy for an event of default relating to certain failures by the Company to comply with certain reporting covenants in the Indenture consists exclusively of the right to receive additional interest on the 2021 Notes.

The 2021 Notes will be senior unsecured obligations and will rank equally with all of the Company’s existing and future senior debt and senior to any of the Company’s subordinated debt. The 2021 Notes will be structurally subordinated to all existing or future indebtedness and other liabilities (including trade payables) of the Company’s subsidiaries and will be effectively subordinated to the Company’s existing or future secured indebtedness to the extent of the value of the collateral. The Indenture does not limit the amount of debt that the Company or its subsidiaries may incur.

In accounting for the issuance of the 2021 Notes, the Company separated the 2021 Notes into liability and equity components. The carrying amount of the liability component was calculated by measuring the fair value of a similar liability that does not have an associated convertible feature. The carrying amount of the equity component representing the conversion option was determined by deducting the fair value of the liability component from the par value of the 2021 Notes as a whole. The equity component is not re-measured as long as it continues to meet the conditions for equity classification.

The outstanding note balance as of September 30, 2020 and December 31, 2019 consisted of the following:

 

(In thousands)

 

September 30, 2020

 

 

December 31, 2019

 

Liability component:

 

 

 

 

 

 

 

 

Principal

 

 

69,000

 

 

$

69,000

 

Less: debt discount and debt issuance costs, net

 

 

(1,581

)

 

 

(3,198

)

Net carrying amount

 

$

67,419

 

 

$

65,802

 

Equity component

 

$

22,791

 

 

$

22,791

 

 

In connection with the issuance of the 2021 Notes, the Company incurred approximately $7.5 million of debt issuance costs, which primarily consisted of underwriting, legal and other professional fees, and allocated these costs to the liability

and equity components based on the allocation of the proceeds. Of the total $7.5 million of debt issuance costs, $1.3 million were allocated to the equity component and recorded as a reduction to additional paid-in capital and $6.2 million were allocated to the liability component and recorded as a reduction in the carrying amount of the debt liability on the balance sheet. The portion allocated to the liability component is amortized to interest expense over the expected life of the 2021 Notes using the effective interest method.

As of September 30, 2020, the remaining contractual life of the 2021 Notes is approximately 9 months. The effective interest rate on the liability component was approximately 4.8% for the period from the date of issuance through September 30, 2020. The fair value of the Company’s 2021 Notes was approximately $55.3 million as of September 30, 2020.

The following table sets forth total interest expense recognized related to the 2021 Notes for the three and nine-month periods ended September 30, 2020 and 2019:

 

(In thousands)

 

Three-month period ended September 30, 2020

 

 

Three-month period ended September 30, 2019

 

 

Nine-month period ended September 30, 2020

 

 

Nine-month period ended September 30, 2019

 

Contractual interest expense

 

$

302

 

 

$

1,509

 

 

$

906

 

 

$

4,528

 

Amortization of debt issuance costs

 

 

50

 

 

 

241

 

 

 

150

 

 

 

713

 

Amortization of debt discount

 

 

495

 

 

 

2,360

 

 

 

1,467

 

 

 

6,997

 

Total interest expense

 

$

847

 

 

$

4,110

 

 

$

2,523

 

 

$

12,238

 

 

v3.20.2
Leases
9 Months Ended
Sep. 30, 2020
Leases [Abstract]  
Leases

(11) Leases

In February 2016, the FASB issued ASU 2016-02, “Leases” Topic 842, which amends the guidance in former ASC Topic 840, Leases.

The interest rate implicit in lease contracts is typically not readily determinable. As such, the Company utilizes its incremental borrowing rate, which is the rate incurred to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment.

Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred, if any. Our leases have remaining lease terms of 2 years to 7 years, some of which include options to extend the lease term for up to 15 years, and some of which include options to terminate the lease within 2 years.

Operating Leases

We lease certain office space, manufacturing and warehouse space under arrangements classified as leases under ASC 842. Leases with an initial term of 12 months or less are not recorded on the balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term. Most leases include one or more options to renew, with renewal options ranging from 5 to 15 years. The exercise of lease renewal options is at our sole discretion. One of our leases also includes an option to early terminate the lease within 2 years.

Ardsley, New York

In June 2011, the Company entered into a 15-year lease for an aggregate of approximately 138,000 square feet of office and laboratory space in Ardsley, New York. In 2014, the Company exercised its option to expand into an additional 25,405 square feet of office space, which the Company occupied in January 2015. The Company has options to extend the term of the lease for three additional five-year periods, and the Company has an option to terminate the lease after 10 years subject to payment of an early termination fee.  The Company’s extension and early termination rights are subject to specified terms and conditions, including specified time periods when they must be exercised, and are also subject to limitations including that the Company not be in default under the lease.

The Ardsley lease provides for monthly payments of rent during the lease term. These payments consist of base rent, which takes into account the costs of the facility improvements funded by the facility owner prior to the Company’s occupancy, and additional rent covering customary items such as charges for utilities, taxes, operating expenses, and other facility fees and charges.   

Chelsea, Massachusetts

Through our Civitas subsidiary, we lease a manufacturing facility in Chelsea, Massachusetts which we use to manufacture Inbrija. The approximately 90,000 square foot facility also includes office and laboratory space. Civitas leases this facility from North River Everett Ave, LLC pursuant to a lease with a term that expires on December 31, 2025, and Civitas has two additional extension options of five years each.  

In 2017, the Company’s Civitas subsidiary amended its existing Chelsea, Massachusetts lease. The amendment added expansion property located in Chelsea, Massachusetts next to the existing facility. The additional property includes land being used for parking and a free-standing warehouse building on the same site.   

In 2018, the Company initiated a renovation and expansion of a building within the Chelsea manufacturing facility that increased the size of the facility to approximately 95,000 square feet. The project has added a new manufacturing production line for Inbrija and other ARCUS products that has greater capacity than the existing manufacturing line, and has created additional warehousing space for manufactured product. Although the project was substantially completed in late 2019, it will take additional time after completion of construction to obtain the approvals needed for use of the new production line for commercial manufacture, such as approvals from the FDA, Massachusetts state environmental permits, and approvals from other regulatory authorities. All costs to renovate and expand the facility are borne by the Company, and therefore will be accounted for as leasehold improvements when the renovation and expansion is approved to be used for production.

Additional Facilities

In October 2016, we entered into a 10-year lease agreement with a term commencing January 1, 2017, for approximately 26,000 square feet of lab and office space in Waltham, MA. The lease provides for monthly rental payments over the lease term. 

Our leases have remaining lease terms of 2 years to 7 years, which assumes exercise of the early termination of our Ardsley, NY lease. We do not include any renewal options in our lease terms when calculating our lease liabilities as we are not reasonably certain that we will exercise these options. When calculating the lease liability, we assume exercise of the Ardsley early termination option. The weighted-average remaining lease term for our operating leases was 3.9 years at September 30, 2020. The weighted-average discount rate was 7.14% at September 30, 2020.

ROU assets and lease liabilities related to our operating leases are as follows:

 

(In thousands)

 

Balance Sheet Classification

 

September 30, 2020

 

 

September 30, 2019

 

Right-of-use assets

 

Right of use assets

 

$

19,805

 

 

$

24,675

 

Current lease liabilities

 

Current portion of lease liabilities

 

 

7,893

 

 

 

7,696

 

Non-current lease liabilities

 

Non-current portion of lease liabilities

 

 

18,747

 

 

 

24,393

 

 

We have lease agreements that contain both lease and non-lease components. We account for lease components together with non-lease components (e.g., common-area maintenance). The components of lease costs were as follows:

 

(In thousands)

 

Three-month period ended September 30, 2020

 

 

Three-month period ended September 30, 2019

 

 

Nine-month period ended September 30, 2020

 

 

Nine-month period ended September 30, 2019

 

Operating lease cost

 

$

1,775

 

 

$

1,776

 

 

$

5,572

 

 

$

5,293

 

Variable lease cost

 

 

1,052

 

 

 

1,119

 

 

 

2,687

 

 

 

3,544

 

Short-term lease cost

 

 

443

 

 

 

440

 

 

 

1,248

 

 

 

1,094

 

Total lease cost

 

$

3,270

 

 

$

3,335

 

 

$

9,507

 

 

$

9,931

 

 

Future minimum commitments under all non-cancelable operating leases are as follows:

 

(In thousands)

 

 

 

 

2020 (excluding the nine months ended September 30, 2020)

 

$

1,951

 

2021

 

 

7,944

 

2022

 

 

10,024

 

2023

 

 

3,097

 

2024

 

 

3,184

 

Later years

 

 

4,594

 

Total lease payments

 

 

30,794

 

Less: Imputed interest

 

 

(4,155

)

Present value of lease liabilities

 

$

26,639

 

 

Supplemental cash flow information related to our operating leases are as follows:

 

(In thousands)

 

Nine-month period ended September 30, 2020

 

 

Nine-month period ended September 30, 2019

 

Operating cash flow information:

 

 

 

 

 

 

 

 

Cash paid for amounts included in the measurement of lease liabilities

 

$

5,818

 

 

$

5,605

 

Non-cash activity:

 

 

 

 

 

 

 

 

Right-of-use assets obtained in exchange for lease obligations

 

$

 

 

$

770

 

 

v3.20.2
Commitments and Contingencies
9 Months Ended
Sep. 30, 2020
Commitments And Contingencies Disclosure [Abstract]  
Commitments and Contingencies

(12) Commitments and Contingencies

The Company has a dispute with another party which has asserted a claim related to royalties on sales of Ampyra (which lost exclusivity in July 2018). While the Company is unable to determine the ultimate outcome of the dispute, and believes it has valid defenses and intends to defend itself vigorously, the Company determined that it is probable that the Company may incur a liability related to the dispute which the Company estimated could be $2 million, inclusive of its legal costs. The Company recorded a liability of $2 million in the three-month period ended September 30, 2020 related to the dispute, however, the Company notes that depending upon the ultimate outcome of the dispute, the potential liability could be more or less than the amount recorded.

In addition to the dispute described above, from time to time the Company is involved in litigation or other legal proceedings relating to claims arising out operations in the normal course of business. The Company has assessed all litigation and legal proceedings and does not believe that it is probable that a liability has been incurred or that the amount of any potential liability or range of losses can be reasonably estimated. As a result, the Company did not record any loss contingencies for these other matters. Litigation expenses are expensed as incurred.

v3.20.2
Summary of Significant Accounting Policies (Policies)
9 Months Ended
Sep. 30, 2020
Accounting Policies [Abstract]  
Restricted Cash

Restricted Cash

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the statement of financial position that sum to the total of the same amounts shown in the statement of cash flows:

 

Nine-month period ended September 30, 2020

 

 

Nine-month period ended September 30, 2019

 

(In thousands)

Beginning of period

 

 

End of period

 

 

Beginning of period

 

 

End of period

 

Cash and cash equivalents

$

62,085

 

 

$

57,910

 

 

$

293,564

 

 

$

119,521

 

Restricted cash

 

12,836

 

 

 

13,200

 

 

 

532

 

 

 

387

 

Restricted cash non-current

 

30,270

 

 

 

24,819

 

 

 

255

 

 

 

256

 

Total Cash, cash equivalents and restricted cash per statement of cash flows

$

105,191

 

 

$

95,929

 

 

$

294,351

 

 

$

120,164

 

 

Amounts included in restricted cash represent those amounts in escrow related to the 6% semi-annual interest portion of the convertible note exchange completed in December 2019 payable within the next 12 months and those amounts required to be set aside to cover the Company’s self-funded employee health insurance costs over the next 12 months. Restricted cash non-current represents those amounts in escrow related to the 6% semi-annual interest portion of the convertible note exchange completed in December 2019 payable subsequent to the next twelve months and cash collateralized standby letters of credit in connection with obligations under facility leases due to the long-term nature of the letters of credit. The 6% semi-annual interest portion of the convertible notes is payable in cash or, if permitted by the terms of the notes, stock.

Inventory

Inventory

The major classes of inventory were as follows:

(In thousands)

 

September 30, 2020

 

 

December 31, 2019

 

Raw materials

 

$

3,366

 

 

$

1,753

 

Work-in-progress

 

 

6,010

 

 

 

13,509

 

Finished goods

 

 

20,744

 

 

 

9,959

 

Total

 

$

30,120

 

 

$

25,221

 

The Company reviews inventory, including inventory purchase commitments, for slow moving or obsolete amounts based on expected product sales volume and provides reserves against the carrying amount of inventory as appropriate.

Foreign Currency Translation

Foreign Currency Translation

The functional currency of operations outside the United States of America is deemed to be the currency of the local country, unless otherwise determined that the United States dollar would serve as a more appropriate functional currency given the economic operations of the entity. Accordingly, the assets and liabilities of the Company’s foreign subsidiary, Biotie, are translated into United States dollars using the period-end exchange rate; income and expense items are translated using the average exchange rate during the period; and equity transactions are translated at historical rates. Cumulative translation adjustments are reflected as a separate component of equity. Foreign currency transaction losses and gains are recognized in the period incurred and are reported as other (expense) income, net in the statement of operations.

Segment and Geographic Information

Segment and Geographic Information

The Company is managed and operated as one business which is focused on developing therapies that restore function and improve the lives of people with neurological disorders. The entire business is managed by a single management team that reports to the Chief Executive Officer, who is the chief operating decision maker. The Company does not operate separate lines of business with respect to any of its products or product candidates and the Company does not prepare discrete financial information with respect to separate products or product candidates or by location. Accordingly, the Company views its business as one reportable operating segment. Net product revenues reported are derived from the sales of Inbrija and Ampyra in the U.S. for the three and nine-month periods ended September 30, 2020 and 2019.

Impairment Or Disposal Of Long Lived Assets Policy

Impairment of Long-Lived Assets

The Company continually evaluates whether events or circumstances have occurred that indicate that the estimated remaining useful lives of its long-lived assets, including identifiable intangible assets subject to amortization and indefinite lived intangible assets not subject to amortization and property plant and equipment, may warrant revision or that the carrying value of the assets may be impaired. Factors the Company considers important that could trigger an impairment review include significant changes in the use of any assets, changes in historical trends in operating performance, changes in projected operating performance, results of clinical trials, stock price, loss of a major customer and significant negative economic trends. Based on the Company’s evaluation for the three-month period ended March 31, 2020, the Company determined that its indefinite lived intangible asset BTT1023 was fully impaired and recorded an asset impairment in its consolidated statement of operations. The Company also determined that its finite lived intangible assets were not impaired for the three and nine-month periods ended September 30, 2020.

Liquidity Policy

Liquidity

The Company assesses and determines its ability to continue as a going concern in accordance with the provisions of ASC Topic 205-40, “Presentation of Financials Statements—Going Concern” (“ASC Topic 205-40”), which requires the Company to evaluate whether there are conditions or events that raise substantial doubt about its ability to continue as a going concern within one year after the date that its annual and interim consolidated financial statements are issued. Certain additional financial statement disclosures are required if such conditions or events are identified. If and when an entity’s liquidation becomes imminent, financial statements should be prepared under the liquidation basis of accounting. Determining the extent, if any, to which conditions or events raise substantial doubt about the Company’s ability to continue

as a going concern, or the extent to which mitigating plans sufficiently alleviate any such substantial doubt, as well as whether or not liquidation is imminent, requires significant judgement by management.

The Company has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date the consolidated financial statements contained in this report are issued.

Based on our cash, cash equivalents and short-term investments at September 30, 2020, our recent net losses, and our obligations that are due within the next 12 months, including $69.0 million aggregate principal amount of our 1.75% Convertible Senior Notes due 2021 that mature on June 15, 2021, management has concluded that there is substantial doubt regarding our ability to meet our obligations within one year after the date the consolidated financial statements in this report are issued and, therefore, to continue as a going concern.

Our ability to meet our future operating requirements, repay our liabilities, meet our other obligations, and continue as a going concern are dependent upon a number of factors, including our ability to generate cash from product sales, reduce planned expenditures, and obtain additional financing. If we are unable to generate sufficient cash flow from the sale of our products, we may be required to adopt one or more alternatives, subject to the restrictions contained in the indenture governing our 6.00% Convertible Senior Secured Notes due 2024, such as further reducing expenses, selling assets, restructuring debt, or obtaining additional equity capital on terms that may be onerous and which are likely to be highly dilutive. Also, our ability to raise additional capital and repay or restructure our indebtedness will depend on the capital markets and our financial condition at such time, among other factors. In addition, financing may not be available when needed, at all, on terms acceptable to us or in accordance with the restrictions described above.

Subsequent Events

Subsequent Events

Subsequent events are defined as those events or transactions that occur after the balance sheet date, but before the financial statements are filed with the Securities and Exchange Commission. The Company completed an evaluation of the impact of any subsequent events through the date these financial statements were issued, and determined there were no subsequent events that required disclosure in these financial statements. 

Accounting Pronouncements Adopted

Accounting Pronouncements Adopted

In June 2016, the FASB issued ASU 2016-13, “Financial Instruments – Credit Losses” (Topic 326): Measurement of Credit Losses on Financial Instruments and subsequently amended by ASU 2019-04 and ASU 2019-05 which introduces a forward-looking approach, based on expected losses, to estimate credit losses on certain types of financial instruments, including trade receivables. This new standard amends the current guidance on the impairment of financial instruments. The ASU adds to U.S. GAAP an impairment model known as current expected credit loss (CECL) 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. The ASU is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years with early adoption permitted. The Company adopted this guidance effective January 1, 2020. The adoption of this guidance did not have a material impact on the consolidated financial statements.

In August 2018, the FASB issued ASU 2018-13 “Fair Value Measurement (Topic 820): “Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement.” The amendment in this ASU eliminate, add and modify certain disclosure requirements for fair value measurements as part of its disclosure framework project. Entities will no longer be required to disclose the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, but public business entities will be required to disclose the range and weighted average used to develop significant unobservable inputs for Level 3 fair value measurements. The ASU is effective for all entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years with early adoption permitted. The Company adopted this guidance effective January 1, 2020. The adoption of this guidance did not have a significant impact on the consolidated financial statements.

In August 2018, the FASB issued ASU 2018-15, “Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract.” The ASU clarifies certain aspects of ASU 2015-05, “Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement,” which was issued in April 2015. Specifically, the ASU 2018-15 aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license).” The ASU is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years with early adoption permitted. The Company adopted this guidance effective January 1, 2020. The adoption of this guidance did not have an impact on the consolidated financial statements.

In November 2018, the FASB issued ASU 2018-18, Collaborative arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606. ASU 2018-18 clarifies that certain transactions between participants in a collaborative arrangement should be accounted for under ASC 606 when the counterparty is a customer and precludes an entity from presenting consideration from a transaction in a collaborative arrangement as revenue from contracts with customers if the counterparty is not a customer for that transaction. The ASU is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years with early adoption permitted. The Company adopted this guidance effective January 1, 2020. The adoption of this guidance did not have a significant impact on the consolidated financial statements.

Accounting Pronouncements Not Yet Adopted

Accounting Pronouncements Not Yet Adopted

In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes. The ASU enhances and simplifies various aspects of the income tax accounting guidance in ASC 740 and removes certain exceptions for recognizing deferred taxes for investments, performing intraperiod allocation and calculating income taxes in interim periods. The ASU also adds guidance to reduce complexity in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group. This ASU is effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years with early adoption permitted. The Company is currently evaluating the impact the adoption of this guidance may have on its consolidated financial statements.

In March 2020, the FASB issued ASU 2020-03, “Codification Improvements to Financial Instruments”: The amendments in this update are to clarify, correct errors in, or make minor improvements to a variety of ASC topics. The changes in ASU 2020-03 are not expected to have a significant effect on current accounting practices. The ASU improves various financial instrument topics in the Codification to increase stakeholder awareness of the amendments and to expedite the improvement process by making the Codification easier to understand and easier to apply by eliminating inconsistencies and providing clarifications. The ASU is effective for fiscal years beginning after December 15, 2020 with early application permitted. The Company is currently evaluating the impact the adoption of this guidance may have on its consolidated financial statements.

v3.20.2
Summary of Significant Accounting Policies (Tables)
9 Months Ended
Sep. 30, 2020
Accounting Policies [Abstract]  
Reconciliation of Cash, Cash Equivalents and Restricted Cash

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the statement of financial position that sum to the total of the same amounts shown in the statement of cash flows:

 

Nine-month period ended September 30, 2020

 

 

Nine-month period ended September 30, 2019

 

(In thousands)

Beginning of period

 

 

End of period

 

 

Beginning of period

 

 

End of period

 

Cash and cash equivalents

$

62,085

 

 

$

57,910

 

 

$

293,564

 

 

$

119,521

 

Restricted cash

 

12,836

 

 

 

13,200

 

 

 

532

 

 

 

387

 

Restricted cash non-current

 

30,270

 

 

 

24,819

 

 

 

255

 

 

 

256

 

Total Cash, cash equivalents and restricted cash per statement of cash flows

$

105,191

 

 

$

95,929

 

 

$

294,351

 

 

$

120,164

 

 

Schedule of Major Classes of Inventory

Inventory

The major classes of inventory were as follows:

(In thousands)

 

September 30, 2020

 

 

December 31, 2019

 

Raw materials

 

$

3,366

 

 

$

1,753

 

Work-in-progress

 

 

6,010

 

 

 

13,509

 

Finished goods

 

 

20,744

 

 

 

9,959

 

Total

 

$

30,120

 

 

$

25,221

 

v3.20.2
Revenue (Tables)
9 Months Ended
Sep. 30, 2020
Revenue From Contract With Customer [Abstract]  
Disaggregation of Revenue

The following table disaggregates our revenue by major source:

 

(In thousands)

Three-month period ended September 30, 2020

 

 

Three-month period ended September 30, 2019

 

 

Nine-month period ended September 30, 2020

 

 

Nine-month period ended September 30, 2019

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net product revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ampyra

$

27,343

 

 

$

39,322

 

 

$

73,546

 

 

$

123,579

 

Inbrija

 

5,833

 

 

 

4,889

 

 

 

14,901

 

 

 

9,164

 

Other

 

1,511

 

 

 

589

 

 

 

1,706

 

 

 

582

 

Total net product revenues

 

34,687

 

 

 

44,800

 

 

 

90,153

 

 

 

133,325

 

Milestone revenues

 

15,000

 

 

 

 

 

 

15,000

 

 

 

 

Royalty revenues

 

3,403

 

 

 

2,922

 

 

 

9,654

 

 

 

8,586

 

Total net revenues

$

53,090

 

 

$

47,722

 

 

$

114,807

 

 

$

141,911

 

v3.20.2
Share-based Compensation (Tables)
9 Months Ended
Sep. 30, 2020
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]  
Schedule of Share-based Compensation Expense

The following table summarizes share-based compensation expense included within the consolidated statements of operations:

 

 

 

For the three-month period ended September 30,

 

 

For the nine-month period ended September 30,

 

(In thousands)

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Research and development expense

 

$

555

 

 

$

719

 

 

$

1,418

 

 

$

2,203

 

Selling, general and administrative expense

 

 

1,832

 

 

 

2,424

 

 

 

4,834

 

 

 

8,785

 

Cost of Sales

 

 

93

 

 

 

149

 

 

 

260

 

 

 

505

 

Total

 

$

2,480

 

 

$

3,292

 

 

$

6,512

 

 

$

11,493

 

Schedule of Stock Option Activity

A summary of share-based compensation activity for the nine-month period ended September 30, 2020 is presented below:

 

 

 

Number of

Shares

(In thousands)

 

 

Weighted

Average

Exercise

Price

 

 

Weighted

Average

Remaining

Contractual

Term

 

 

Intrinsic

Value

(In thousands)

 

Balance at January 1, 2020

 

 

10,469

 

 

$

22.96

 

 

 

 

 

 

 

 

 

Granted

 

 

237

 

 

 

1.00

 

 

 

 

 

 

 

 

 

Cancelled

 

 

(2,339

)

 

 

27.41

 

 

 

 

 

 

 

 

 

Exercised

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at September 30, 2020

 

 

8,366

 

 

$

21.09

 

 

 

6.0

 

 

$

 

Vested and expected to vest at

    September 30, 2020

 

 

8,342

 

 

$

21.14

 

 

 

6.0

 

 

$

 

Vested and exercisable at

    September 30, 2020

 

 

6,482

 

 

$

25.72

 

 

 

4.7

 

 

$

 

Restricted Stock and Performance Stock Unit  
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]  
Schedule of Restricted Stock and Performance Stock Unit Activity

 

(In thousands)

 

 

 

 

Restricted Stock and Performance Stock Units

 

Number of Shares

 

Nonvested at January 1, 2020

 

 

425

 

Granted

 

 

 

Vested

 

 

(4

)

Forfeited

 

 

(60

)

Nonvested at September 30, 2020

 

 

361

 

v3.20.2
Income (Loss) Per Share (Tables)
9 Months Ended
Sep. 30, 2020
Earnings Per Share [Abstract]  
Schedule of Computation of Basic and Diluted Loss per Share

The following table sets forth the computation of basic and diluted loss per share for the three and nine-month periods ended September 30, 2020 and 2019:

 

(In thousands, except per share data)

 

Three-month period ended September 30, 2020

 

 

Three-month period ended September 30, 2019

 

 

Nine-month period ended September 30, 2020

 

 

Nine-month period ended September 30, 2019

 

Basic and diluted

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)—basic

 

$

7,347

 

 

$

(263,535

)

 

$

(16,546

)

 

$

(338,626

)

Plus: Dilutive effect of convertible notes, net of tax

 

 

1,476

 

 

 

 

 

 

 

 

 

 

Net income (loss)—diluted

 

$

8,823

 

 

$

(263,535

)

 

$

(16,546

)

 

$

(338,626

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding used in

   computing net income (loss) per share—basic

 

 

47,705

 

 

 

47,511

 

 

 

47,704

 

 

 

47,491

 

Plus: Dilutive effect of convertible notes

 

 

118,440

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding used in

   computing net income (loss) per share—diluted

 

 

166,145

 

 

 

47,511

 

 

 

47,704

 

 

 

47,491

 

Net income (loss) per share—basic

 

$

0.15

 

 

$

(5.55

)

 

$

(0.35

)

 

$

(7.13

)

Net income (loss) per share—diluted

 

$

0.05

 

 

$

(5.55

)

 

$

(0.35

)

 

$

(7.13

)

Schedule of Anti-dilutive Securities Excluded from Calculation of Net Loss per Diluted Share

The following amounts were not included in the calculation of net loss per diluted share because their effects were anti-dilutive:

 

(In thousands)

 

Three-month period ended September 30, 2020

 

 

Three-month period ended September 30, 2019

 

 

Nine-month period ended September 30, 2020

 

 

Nine-month period ended September 30, 2019

 

Denominator

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock options and restricted common shares

 

 

8,784

 

 

 

8,988

 

 

 

8,532

 

 

 

8,968

 

v3.20.2
Fair Value Measurements (Tables)
9 Months Ended
Sep. 30, 2020
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]  
Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis

 

(In thousands)

 

Level 1

 

 

Level 2

 

 

Level 3

 

September 30, 2020

 

 

 

 

 

 

 

 

 

 

 

 

Assets Carried at Fair Value:

 

 

 

 

 

 

 

 

 

 

 

 

Money market funds

 

$

31,283

 

 

$

 

 

$

 

Corporate bonds

 

 

 

 

 

5,347

 

 

 

 

Liabilities Carried at Fair Value:

 

 

 

 

 

 

 

 

 

 

 

 

Derivative liability - conversion option

 

 

 

 

 

 

 

 

832

 

Acquired contingent consideration

 

 

 

 

 

 

 

 

46,100

 

December 31, 2019

 

 

 

 

 

 

 

 

 

 

 

 

Assets Carried at Fair Value:

 

 

 

 

 

 

 

 

 

 

 

 

Money market funds

 

$

2,219

 

 

$

 

 

$

 

Commercial paper

 

 

 

 

 

26,569

 

 

 

 

Corporate bonds

 

 

 

 

 

37,185

 

 

 

 

Liabilities Carried at Fair Value:

 

 

 

 

 

 

 

 

 

 

 

 

Derivative liability - conversion option

 

 

 

 

 

 

 

 

59,409

 

Acquired contingent consideration

 

 

 

 

 

 

 

 

80,300

 

Contingent Consideration Liability  
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]  
Schedule of Contingent Liabilities

The following table presents additional information about liabilities measured at fair value on a recurring basis and for which the Company utilizes Level 3 inputs to determine fair value.

 

(In thousands)

 

Three-month period ended September 30, 2020

 

 

Three-month period ended September 30, 2019

 

 

Nine-month period ended September 30, 2020

 

 

Nine-month period ended September 30, 2019

 

Acquired contingent consideration:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, beginning of period

 

$

70,000

 

 

$

162,537

 

 

$

80,300

 

 

$

168,000

 

Fair value change to contingent consideration

   included in the statement of operations

 

 

(23,608

)

 

 

(50,942

)

 

 

(33,455

)

 

 

(56,342

)

Royalty payments

 

 

(292

)

 

 

(395

)

 

 

(745

)

 

 

(458

)

Balance, end of period

 

$

46,100

 

 

$

111,200

 

 

$

46,100

 

 

$

111,200

 

 

Derivative Liability-Conversion Option  
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]  
Schedule of Fair Value Reconciliation of Derivative Liabilities

The following table represents a reconciliation of the derivative liability recorded in connection with the issuance of the convertible senior secured notes due 2024 acquired:

(In thousands)

September 30, 2020

 

 

June 30, 2020

 

 

March 31, 2020

 

 

December 31, 2019

 

Derivative Liability-Conversion Option

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, beginning of period

$

23,953

 

 

$

32,881

 

 

$

59,409

 

 

$

 

Fair value recognized upon issuance of Convertible Senior Notes

 

 

 

 

 

 

 

 

 

 

59,409

 

Fair value adjustment

 

(4,864

)

 

 

(8,928

)

 

 

(26,528

)

 

 

 

Fair value re-classification to shareholder's equity

 

(18,257

)

 

 

 

 

 

 

 

 

 

Balance, end of period

$

832

 

 

$

23,953

 

 

$

32,881

 

 

$

59,409

 

v3.20.2
Investments (Tables)
9 Months Ended
Sep. 30, 2020
Investments Debt And Equity Securities [Abstract]  
Schedule of Available-for-Sale Securities Available-for-sale investments consisted of the following at September 30, 2020 and December 31, 2019, respectively:

 

 

 

 

 

 

Gross

 

 

Gross

 

 

Estimated

 

 

 

Amortized

 

 

Unrealized

 

 

Unrealized

 

 

Fair

 

(In thousands)

 

Cost

 

 

Gains

 

 

Losses

 

 

Value

 

September 30, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate Bonds

 

 

5,341

 

 

 

6

 

 

 

-

 

 

 

5,347

 

Total Short-term investments

 

$

5,341

 

 

$

6

 

 

$

-

 

 

$

5,347

 

December 31, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial Paper

 

$

26,550

 

 

$

19

 

 

$

 

 

$

26,569

 

Corporate Bonds

 

 

37,177

 

 

 

20

 

 

 

(12

)

 

 

37,185

 

Total Short-term investments

 

$

63,727

 

 

$

39

 

 

$

(12

)

 

$

63,754

 

 

Schedule of Changes in Accumulated Other Comprehensive (Loss) Income The changes in AOCI associated with the unrealized holding gains on available-for-sale investments during the nine-month period ended September 30, 2020, were as follows (in thousands):

 

(In thousands)

 

Net Unrealized Gains (Losses) on Marketable Securities

 

Balance at December 31, 2019

 

$

27

 

Other comprehensive income before reclassifications:

 

 

 

 

Amounts reclassified from accumulated other comprehensive income

 

 

 

Net current period other comprehensive loss

 

 

(21

)

Balance at September 30, 2020

 

$

6

 

 

v3.20.2
Liability Related to Sale of Future Royalties (Tables)
9 Months Ended
Sep. 30, 2020
Deferred Revenue Disclosure [Abstract]  
Schedule of Activity Within Liability Related to Sale of Future Royalties The following table shows the activity within the liability account for September 30, 2020 and December 31, 2019, respectively:

 

(In thousands)

 

Nine-month period ended September 30, 2020

 

 

Twelve-month period ended December 31, 2019

 

Liability related to sale of future royalties - beginning balance

 

$

24,401

 

 

$

30,716

 

Deferred transaction costs recognized

 

 

318

 

 

 

639

 

Non-cash royalty revenue payable to HCRP

 

 

(8,496

)

 

 

(10,271

)

Non-cash interest expense recognized

 

 

1,548

 

 

 

3,317

 

Liability related to sale of future royalties - ending balance

 

$

17,771

 

 

$

24,401

 

 

 

 

 

 

 

 

 

 

 

v3.20.2
Debt (Tables)
9 Months Ended
Sep. 30, 2020
Convertible Senior Secured Notes due 2024  
Summary of Outstanding Note Balances

The outstanding New Note balance as of September 30, 2020 and December 31, 2019 consisted of the following:

 

(In thousands)

 

September 30, 2020

 

 

December 31, 2019

 

Liability component:

 

 

 

 

 

 

 

 

Principal

 

 

207,000

 

 

$

207,000

 

Less: debt discount and debt issuance costs, net

 

 

(72,378

)

 

 

(80,028

)

Net carrying amount

 

$

134,622

 

 

$

126,972

 

Equity component

 

$

18,257

 

 

$

 

Derivative liability-conversion option

 

$

832

 

 

$

59,409

 

Schedule of Interest Expense Recognized Related to the Notes

The following table sets forth total interest expense recognized related to the Notes for the three and nine-month periods ended September 30, 2020:

 

(In thousands)

 

Three-month period ended September 30, 2020

 

 

Nine-month period ended September 30, 2020

 

Contractual interest expense

 

$

3,105

 

 

$

9,315

 

Amortization of debt issuance costs

 

 

204

 

 

 

585

 

Amortization of debt discount

 

 

2,663

 

 

 

7,647

 

Total interest expense

 

$

5,972

 

 

$

17,547

 

Convertible Senior Notes due 2021  
Summary of Outstanding Note Balances

The outstanding note balance as of September 30, 2020 and December 31, 2019 consisted of the following:

 

(In thousands)

 

September 30, 2020

 

 

December 31, 2019

 

Liability component:

 

 

 

 

 

 

 

 

Principal

 

 

69,000

 

 

$

69,000

 

Less: debt discount and debt issuance costs, net

 

 

(1,581

)

 

 

(3,198

)

Net carrying amount

 

$

67,419

 

 

$

65,802

 

Equity component

 

$

22,791

 

 

$

22,791

 

Schedule of Interest Expense Recognized Related to the Notes

The following table sets forth total interest expense recognized related to the 2021 Notes for the three and nine-month periods ended September 30, 2020 and 2019:

 

(In thousands)

 

Three-month period ended September 30, 2020

 

 

Three-month period ended September 30, 2019

 

 

Nine-month period ended September 30, 2020

 

 

Nine-month period ended September 30, 2019

 

Contractual interest expense

 

$

302

 

 

$

1,509

 

 

$

906

 

 

$

4,528

 

Amortization of debt issuance costs

 

 

50

 

 

 

241

 

 

 

150

 

 

 

713

 

Amortization of debt discount

 

 

495

 

 

 

2,360

 

 

 

1,467

 

 

 

6,997

 

Total interest expense

 

$

847

 

 

$

4,110

 

 

$

2,523

 

 

$

12,238

 

v3.20.2
Leases (Tables)
9 Months Ended
Sep. 30, 2020
Leases [Abstract]  
Schedule of ROU Assets and Lease Liabilities Related to Operating Leases

ROU assets and lease liabilities related to our operating leases are as follows:

 

(In thousands)

 

Balance Sheet Classification

 

September 30, 2020

 

 

September 30, 2019

 

Right-of-use assets

 

Right of use assets

 

$

19,805

 

 

$

24,675

 

Current lease liabilities

 

Current portion of lease liabilities

 

 

7,893

 

 

 

7,696

 

Non-current lease liabilities

 

Non-current portion of lease liabilities

 

 

18,747

 

 

 

24,393

 

 

Components of Lease Costs The components of lease costs were as follows:

 

(In thousands)

 

Three-month period ended September 30, 2020

 

 

Three-month period ended September 30, 2019

 

 

Nine-month period ended September 30, 2020

 

 

Nine-month period ended September 30, 2019

 

Operating lease cost

 

$

1,775

 

 

$

1,776

 

 

$

5,572

 

 

$

5,293

 

Variable lease cost

 

 

1,052

 

 

 

1,119

 

 

 

2,687

 

 

 

3,544

 

Short-term lease cost

 

 

443

 

 

 

440

 

 

 

1,248

 

 

 

1,094

 

Total lease cost

 

$

3,270

 

 

$

3,335

 

 

$

9,507

 

 

$

9,931

 

 

Schedule of Future Minimum Commitments under all Non-Cancelable Operating Leases

Future minimum commitments under all non-cancelable operating leases are as follows:

 

(In thousands)

 

 

 

 

2020 (excluding the nine months ended September 30, 2020)

 

$

1,951

 

2021

 

 

7,944

 

2022

 

 

10,024

 

2023

 

 

3,097

 

2024

 

 

3,184

 

Later years

 

 

4,594

 

Total lease payments

 

 

30,794

 

Less: Imputed interest

 

 

(4,155

)

Present value of lease liabilities

 

$

26,639

 

 

Summary of Supplemental Cash Flow Information Related to Operating Leases

Supplemental cash flow information related to our operating leases are as follows:

 

(In thousands)

 

Nine-month period ended September 30, 2020

 

 

Nine-month period ended September 30, 2019

 

Operating cash flow information:

 

 

 

 

 

 

 

 

Cash paid for amounts included in the measurement of lease liabilities

 

$

5,818

 

 

$

5,605

 

Non-cash activity:

 

 

 

 

 

 

 

 

Right-of-use assets obtained in exchange for lease obligations

 

$

 

 

$

770

 

 

v3.20.2
Summary of Significant Accounting Policies - Reconciliation of Cash, Cash Equivalents and Restricted Cash (Details) - USD ($)
$ in Thousands
Sep. 30, 2020
Dec. 31, 2019
Sep. 30, 2019
Dec. 31, 2018
Accounting Policies [Abstract]        
Cash and cash equivalents $ 57,910 $ 62,085 $ 119,521 $ 293,564
Restricted cash 13,200 12,836 387 532
Restricted cash non-current 24,819 30,270 256 255
Total Cash, cash equivalents and restricted cash per statement of cash flows $ 95,929 $ 105,191 $ 120,164 $ 294,351
v3.20.2
Summary of Significant Accounting Policies - Additional Information (Details)
$ in Millions
9 Months Ended
Sep. 30, 2020
USD ($)
Segment
Dec. 24, 2019
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]    
Percentage of interest portion payable in cash or stock upon exchange of Convertible Note 6.00%  
Segment and Geographic Information    
Number of operating segments 1  
Number of reportable operating segments 1  
Liquidity    
Principal amount of debt exchanged | $ $ 69.0  
Interest rate (as a percent) 1.75% 6.00%
Convertible Senior Notes Due2024    
Liquidity    
Interest rate (as a percent) 6.00%  
Restricted Cash And Cash Equivalent    
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]    
Percentage of interest portion upon exchange of Convertible Note within next twelve months 6.00%  
Restricted Cash And Cash Equivalent Noncurrent    
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]    
Percentage of interest portion upon exchange of Convertible Note subsequent to next twelve months 6.00%  
v3.20.2
Summary of Significant Accounting Policies - Schedule of Major Classes of Inventory (Details) - USD ($)
$ in Thousands
Sep. 30, 2020
Dec. 31, 2019
Inventory Disclosure [Abstract]    
Raw materials $ 3,366 $ 1,753
Work-in-progress 6,010 13,509
Finished goods 20,744 9,959
Total $ 30,120 $ 25,221
v3.20.2
Revenue - Disaggregation of Revenue (Details) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Disaggregation Of Revenue [Line Items]        
Total net revenues $ 53,090 $ 47,722 $ 114,807 $ 141,911
Ampyra        
Disaggregation Of Revenue [Line Items]        
Total net revenues 27,343 39,322 73,546 123,579
Inbrija        
Disaggregation Of Revenue [Line Items]        
Total net revenues 5,833 4,889 14,901 9,164
Other        
Disaggregation Of Revenue [Line Items]        
Total net revenues 1,511 589 1,706 582
Net Product Revenues        
Disaggregation Of Revenue [Line Items]        
Total net revenues 34,687 44,800 90,153 133,325
Milestone Revenues        
Disaggregation Of Revenue [Line Items]        
Total net revenues 15,000   15,000  
Royalty Revenues        
Disaggregation Of Revenue [Line Items]        
Total net revenues $ 3,403 $ 2,922 $ 9,654 $ 8,586
v3.20.2
Share-based Compensation - Additional Information (Details) - USD ($)
$ / shares in Units, $ in Thousands
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]        
Share-based compensation expense recognized $ 2,480 $ 3,292 $ 6,512 $ 11,493
Weighted average fair value of options granted (in dollars per share) $ 0.39 $ 2.69 $ 0.66 $ 6.49
Unrecognized compensation costs for unvested stock options, restricted stock awards and performance stock units $ 7,800   $ 7,800  
Unrecognized compensation costs, weighted average period     1 year 4 months 24 days  
Purchase of Treasury Stock ,Shares 0   0  
v3.20.2
Share-based Compensation - Schedule of Share-based Compensation Expense (Details) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]        
Share-based compensation expense recognized $ 2,480 $ 3,292 $ 6,512 $ 11,493
Research and development expense        
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]        
Share-based compensation expense recognized 555 719 1,418 2,203
Selling, general, and administrative expense        
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]        
Share-based compensation expense recognized 1,832 2,424 4,834 8,785
Cost of sales        
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]        
Share-based compensation expense recognized $ 93 $ 149 $ 260 $ 505
v3.20.2
Share-based Compensation - Schedule of Stock Options Activity (Details)
shares in Thousands
9 Months Ended
Sep. 30, 2020
$ / shares
shares
Stock Option Activity  
Beginning balance (in shares) | shares 10,469
Granted (in shares) | shares 237
Cancelled (in shares) | shares (2,339)
Ending balance (in shares) | shares 8,366
Vested and expected to vest at the end of the period | shares 8,342
Vested and exercisable at the end of the period | shares 6,482
Weighted Average Exercise Price  
Balance at the beginning of the period (in dollars per share) | $ / shares $ 22.96
Granted (in dollars per share) | $ / shares 1.00
Cancelled (in dollars per share) | $ / shares 27.41
Balance at the end of the period (in dollars per share) | $ / shares 21.09
Vested and expected to vest at the end of the period (in dollars per share) | $ / shares 21.14
Vested and exercisable at the end of the period (in dollars per share) | $ / shares $ 25.72
Weighted Average Remaining Contractual Term  
Balance at the end of the period 6 years
Vested and expected to vest at the end of the period 6 years
Vested and exercisable at the end of the period 4 years 8 months 12 days
v3.20.2
Share-based Compensation - Schedule of Restricted Stock and Performance Stock Unit Activity (Details) - Restricted Stock and Performance Stock Unit
shares in Thousands
9 Months Ended
Sep. 30, 2020
shares
Restricted Stock and Performance Stock Units  
Nonvested at the beginning of the period (in shares) 425
Granted (in shares) 0
Vested (in shares) (4)
Forfeited (in shares) (60)
Nonvested at the end of the period (in shares) 361
v3.20.2
Disclosure - Income (Loss) Per Share - Schedule of Computation of Basic and Diluted Loss Per Share (Details) - USD ($)
$ / shares in Units, shares in Thousands, $ in Thousands
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Basic and diluted        
Net income (loss) $ 7,347 $ (263,535) $ (16,546) $ (338,626)
Plus: Dilutive effect of convertible notes, net of tax 1,476      
Net income (loss)—diluted $ 8,823 $ (263,535) $ (16,546) $ (338,626)
Weighted average common shares outstanding used in computing net income (loss) per share—basic 47,705 47,511 47,704 47,491
Plus: Dilutive effect of convertible notes 118,440      
Weighted average common shares outstanding used in computing net income (loss) per share—diluted 166,145 47,511 47,704 47,491
Net income (loss) per share—basic $ 0.15 $ (5.55) $ (0.35) $ (7.13)
Net income (loss) per share—diluted $ 0.05 $ (5.55) $ (0.35) $ (7.13)
v3.20.2
Disclosure - Income (Loss) Per Share - Schedule of Antidilutive Securities Excluded from Calculation of Net Loss Per Diluted Share (Details) - shares
shares in Thousands
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Antidilutive Securities        
Anti-dilutive securities excluded from computation of loss per share (in shares) 118,440,000   118,440,000  
Stock options and restricted common shares        
Antidilutive Securities        
Anti-dilutive securities excluded from computation of loss per share (in shares) 8,784 8,988 8,532 8,968
v3.20.2
Disclosure - Income (Loss) Per Share - Additional Information (Details) - USD ($)
shares in Millions, $ in Millions
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2020
Earnings Per Share [Abstract]    
Anti-dilutive securities excluded from computation of loss per share (in shares) 118,440 118,440
Interest on convertible senior notes $ 6.8  
Derivative liability gain 4.9  
Tax impact $ 0.5  
v3.20.2
Income Taxes - Additional Information (Details) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended 12 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Dec. 31, 2017
Jul. 31, 2020
Income Tax Disclosure [Abstract]            
Deferred tax assets, valuation allowance $ 1,800   $ 1,800      
Income tax refund receivable           $ 12,700
Net operating loss carryback claims     $ 1,400      
US federal corporate tax rate 21.00% 35.00% 21.00%   35.00%  
Benefit from (Provision for) income taxes $ (1,465) $ (17) $ 4,962 $ 484    
Effective income tax rate (as a percent) 16.60% 0.00% 23.10% 0.14%    
Income tax benefit     $ 200      
v3.20.2
Fair Value Measurements - Additional Information (Details)
9 Months Ended
Sep. 17, 2020
USD ($)
shares
Dec. 24, 2019
Sep. 30, 2020
USD ($)
shares
Aug. 28, 2020
shares
Dec. 31, 2019
shares
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]          
Milestone payment, minimum     $ 1,000,000.0    
Milestone payment, maximum     $ 22,000,000.0    
Notes, interest rate   6.00% 1.75%    
Common stock, Authorized shares | shares 370,000,000   370,000,000 80,000,000 80,000,000
Derivative liability reclassified to equity $ 18,300,000   $ 18,300,000    
Income tax effects on equity transactions     (4,400,000)    
Other assets     800,000    
Minimum | Inbrija          
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]          
Peak annual sales     300,000,000    
Maximum | Inbrija          
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]          
Peak annual sales     $ 500,000,000    
Discount Rate          
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]          
Measurement input, derivative liability 25.0   25.3    
Stock Price          
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]          
Measurement input, derivative liability 0.58   0.52    
Volatility Rate          
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]          
Measurement input, derivative liability 113.0   115.0    
Convertible Senior Notes Due June 2021          
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]          
Debt instrument maturity date     2021-06    
Convertible Senior Secured Notes due 2024          
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]          
Debt instrument maturity date     2024-12    
Notes, interest rate   6.00% 6.00%    
Notes, maturity date   Dec. 01, 2024 Dec. 01, 2024    
Level 2 | Convertible Senior Notes Due June 2021          
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]          
Convertible senior notes     $ 55,300,000    
Level 2 | Convertible Senior Secured Notes due 2024          
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]          
Convertible senior notes     $ 119,300,000    
Level 3 | Weighted Discounted Cash Flow Valuation Approach | Discount Rate          
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]          
Acquired contingent consideration, measurement input     20.5    
v3.20.2
Fair Value Measurements - Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($)
$ in Thousands
Sep. 30, 2020
Dec. 31, 2019
Liabilities Carried at Fair Value:    
Derivative liability - conversion option $ 832 $ 59,409
Level 1 | Recurring basis | Money Market Funds    
Assets Carried at Fair Value:    
Assets, Fair Value 31,283 2,219
Level 2 | Recurring basis | Commercial Paper    
Assets Carried at Fair Value:    
Assets, Fair Value   26,569
Level 2 | Recurring basis | Volatility Rate    
Assets Carried at Fair Value:    
Assets, Fair Value 5,347 37,185
Level 3 | Recurring basis    
Liabilities Carried at Fair Value:    
Derivative liability - conversion option 832 59,409
Acquired contingent consideration $ 46,100 $ 80,300
v3.20.2
Fair Value Measurements - Schedule of Contingent Liabilities (Details) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Assets and liabilities measured at fair value on a recurring basis utilizing Level 3 inputs        
Balance, beginning of period $ 70,000 $ 162,537 $ 80,300 $ 168,000
Fair value change to contingent consideration included in the statement of operations (23,608) (50,942) (33,455) (56,342)
Royalty payments (292) (395) (745) (458)
Balance, end of period $ 46,100 $ 111,200 $ 46,100 $ 111,200
v3.20.2
Fair Value Measurements - Schedule of Fair Value Reconciliation of Derivative Liability (Details) - USD ($)
$ in Thousands
3 Months Ended 12 Months Ended
Sep. 30, 2020
Jun. 30, 2020
Mar. 31, 2020
Dec. 31, 2019
Fair Value Reconciliation Of Derivative Liability [Line Items]        
Balance, beginning of period     $ 59,409  
Balance, end of period $ 832     $ 59,409
Convertible Senior Secured Notes due 2024        
Fair Value Reconciliation Of Derivative Liability [Line Items]        
Balance, beginning of period 23,953 $ 32,881 59,409  
Fair value recognized upon issuance of Convertible Senior Notes       59,409
Fair value adjustment (4,864) (8,928) (26,528)  
Fair value re-classification to shareholder's equity (18,257)      
Balance, end of period $ 832 $ 23,953 $ 32,881 $ 59,409
v3.20.2
Investments - Schedule of Available-for-Sale Securities (Details) - USD ($)
$ in Thousands
Sep. 30, 2020
Dec. 31, 2019
Schedule Of Available For Sale Securities [Line Items]    
Amortized Cost $ 5,341 $ 63,727
Gross Unrealized Gains 6 39
Gross Unrealized Losses   (12)
Estimated Fair Value 5,347 63,754
Commercial Paper    
Schedule Of Available For Sale Securities [Line Items]    
Amortized Cost   26,550
Gross Unrealized Gains   19
Estimated Fair Value   26,569
Volatility Rate    
Schedule Of Available For Sale Securities [Line Items]    
Amortized Cost 5,341 37,177
Gross Unrealized Gains 6 20
Gross Unrealized Losses   (12)
Estimated Fair Value $ 5,347 $ 37,185
v3.20.2
Investments - Additional Information (Details) - USD ($)
Sep. 30, 2020
Dec. 31, 2019
Schedule Of Available For Sale Securities [Line Items]    
Long-term investments $ 0 $ 0
Short-term investments 5,347,000 63,754,000
Short-term investments classified as cash equivalents 31,300,000 2,200,000
Short Term Investments    
Schedule Of Available For Sale Securities [Line Items]    
Fair value of short-term investments in an unrealized loss position $ 0 $ 25,500,000
v3.20.2
Investments - Schedule of Changes in Accumulated Other Comprehensive (loss) Income (Details) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Accumulated Other Comprehensive Income Loss [Line Items]        
Balance at December 31, 2019     $ (1,169)  
Other comprehensive loss, net of tax $ (1,063) $ (3,253) (1,117) $ (3,442)
Balance at September 30, 2020 (2,286)   (2,286)  
Net Unrealized Gains (Losses) on Marketable Securities        
Accumulated Other Comprehensive Income Loss [Line Items]        
Balance at December 31, 2019     27  
Other comprehensive loss, net of tax     (21)  
Balance at September 30, 2020 $ 6   $ 6  
v3.20.2
Liability Related to Sale of Future Royalties - Additional Information (Details) - Royalty Purchase Agreement - USD ($)
$ in Thousands
9 Months Ended 12 Months Ended
Oct. 01, 2017
Sep. 30, 2020
Dec. 31, 2019
Liability Related To Sale Of Future Royalties [Line Items]      
Payment from royalties $ 40,000    
Royalty liability 40,000    
Transaction costs $ 2,200 $ 318 $ 639
v3.20.2
Liability Related to Sale of Future Royalties - Schedule of Activity Within Liability Related to Sale of Future Royalties (Details) - USD ($)
$ in Thousands
9 Months Ended 12 Months Ended
Oct. 01, 2017
Sep. 30, 2020
Sep. 30, 2019
Dec. 31, 2019
Liability Related To Sale Of Future Royalties [Line Items]        
Non-cash royalty revenue payable to HCRP   $ (8,496) $ (7,556)  
Royalty Purchase Agreement        
Liability Related To Sale Of Future Royalties [Line Items]        
Liability related to sale of future royalties - beginning balance   24,401 $ 30,716 $ 30,716
Deferred transaction costs recognized $ 2,200 318   639
Non-cash royalty revenue payable to HCRP   (8,496)   (10,271)
Non-cash interest expense recognized   1,548   3,317
Liability related to sale of future royalties - ending balance   $ 17,771   $ 24,401
v3.20.2
Debt - Additional Information (Details)
3 Months Ended 9 Months Ended 12 Months Ended
Sep. 17, 2020
USD ($)
shares
Dec. 24, 2019
USD ($)
TradingDay
Jun. 17, 2014
USD ($)
Sep. 30, 2020
USD ($)
$ / shares
shares
Sep. 30, 2019
USD ($)
Sep. 30, 2020
USD ($)
$ / shares
shares
Sep. 30, 2019
USD ($)
Dec. 31, 2019
USD ($)
shares
Aug. 28, 2020
shares
Debt Instrument [Line Items]                  
Principal amount of debt exchanged           $ 69,000,000.0      
Interest rate (as a percent)   6.00%   1.75%   1.75%      
Cash payment made for exchange of notes   $ 200              
Aggregate payment on debt exchange   55,200,000              
Gain on debt extinguishment               $ 55,100,000  
Adjusted equity component of convertible notes exchange               $ 38,400,000  
Change in fair value of derivative liability       $ 4,864,000   $ 40,320,000      
Common stock, Authorized shares | shares 370,000,000     370,000,000   370,000,000   80,000,000 80,000,000
Derivative liability reclassified to equity $ 18,300,000         $ 18,300,000      
Income tax effects on equity transactions           (4,400,000)      
Other assets       $ 800,000   800,000      
Interest expense       7,760,000 $ 4,500,000 $ 22,810,000 $ 16,302,000    
Reclassification of derivative liability to equity, net of tax       13,862,000          
Convertible Senior Notes due 2021                  
Debt Instrument [Line Items]                  
Principal amount of debt exchanged   $ 276,000,000.0              
Interest rate (as a percent)   1.75% 1.75%            
Principal amount denomination for debt conversion   $ 1,000              
Principal     $ 345,000,000            
Notes maturity date           Jun. 15, 2021      
Notes frequency of periodic payment           semiannually in arrears in cash      
Debt instrument, principal amount outstanding   $ 69,000,000.0   $ 69,000,000   $ 69,000,000   $ 69,000,000  
Effective interest rate on liability component (as a percent)       4.80%   4.80%      
Debt issuance costs       $ 7,500,000   $ 7,500,000      
Net proceeds from offering, after deducting Underwriter's discount and estimated offering expenses payable     $ 337,500,000            
Period to comply with covenants           270 days      
Reclassification of derivative liability to equity, net of tax           $ 1,300,000      
Debt issuance costs allocated to liability component           $ 6,200,000      
Remaining contractual life           9 months      
Convertible senior notes       55,300,000   $ 55,300,000      
Convertible Senior Notes due 2021 | Debt Conversion Terms upon Occurrence of Certain Fundamental Company Changes                  
Debt Instrument [Line Items]                  
Principal amount of Notes or an integral multiple thereof in which holder may repurchase the Notes       $ 1,000   $ 1,000      
Convertible Senior Notes due 2021 | Debt Conversion Event Term                  
Debt Instrument [Line Items]                  
Minimum percentage of aggregate principal amount held by bondholders to declare notes due and payable           25.00%      
In event of default arising out of certain bankruptcy events, percentage of principal amount due and payable           100.00%      
Convertible Senior Notes due 2021 | Convertible Debt Holder                  
Debt Instrument [Line Items]                  
Initial conversion rate of common stock           23.4968      
Initial conversion price of convertible notes into common stock (in dollars per share) | $ / shares       $ 42.56   $ 42.56      
Convertible Senior Secured Notes due 2024                  
Debt Instrument [Line Items]                  
Interest rate (as a percent)   6.00%   6.00%   6.00%      
Principal amount of debt issued for exchange   $ 750              
Principal   $ 207,000,000.0              
Notes maturity date   Dec. 01, 2024       Dec. 01, 2024      
Interest payment in shares, percentage of daily volume-weighted average price   95.00%              
Notes frequency of periodic payment           semi-annually in arrears      
Interest in shares of common stock, threshold trading days | TradingDay   10              
Initial conversion rate of common stock           285.7142      
Initial conversion price of convertible notes into common stock (in dollars per share) | $ / shares       $ 3.50   $ 3.50      
Principal amount of Notes or an integral multiple thereof in which holder may repurchase the Notes       $ 1,000   $ 1,000      
Debt instrument conversion threshold stock price percentage   130.00%              
Debt repurchase price percentage on principal amount   100.00%              
Debt default, nonpayment of interest, period   30 days              
Debt default, failure to convert notes, period   5 days              
Debt default, non-compliance with covenants, period   60 days              
Debt instrument, principal amount outstanding       207,000,000   207,000,000   207,000,000  
Fair value of derivative liability   $ 59,400,000   832,000   832,000   $ 59,409,000  
Embedded derivative determined the fair value of derivative liability       19,100,000   19,100,000      
Change in fair value of derivative liability       4,900,000          
Debt discount   $ 75,100,000              
Interest expense       6,000,000.0   17,500,000      
Effective interest rate on liability component (as a percent)   18.10%              
Debt fair value amount       119,300,000   119,300,000      
Debt issuance costs       $ 5,700,000   $ 5,700,000      
Convertible Senior Secured Notes due 2024 | Minimum                  
Debt Instrument [Line Items]                  
Debt default, non-payment of outstanding principal   $ 30,000,000.0              
Debt default, failure to pay final judgements   $ 30,000,000.0              
Debt default, percentage of principal outstanding required for immediate payment   25.00%              
v3.20.2
Debt - Summary of Outstanding Note Balances (Details) - USD ($)
$ in Thousands
Sep. 30, 2020
Dec. 31, 2019
Dec. 24, 2019
Convertible Senior Secured Notes due 2024      
Debt Instrument [Line Items]      
Principal $ 207,000 $ 207,000  
Less: debt discount and debt issuance costs, net (72,378) (80,028)  
Net carrying amount 134,622 126,972  
Equity component 18,257    
Derivative liability-conversion option 832 59,409 $ 59,400
Convertible Senior Notes due 2021      
Debt Instrument [Line Items]      
Principal 69,000 69,000 $ 69,000
Less: debt discount and debt issuance costs, net (1,581) (3,198)  
Net carrying amount 67,419 65,802  
Equity component $ 22,791 $ 22,791  
v3.20.2
Debt - Schedule of Interest Expense Recognized Related to the Notes (Details) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Debt Instrument [Line Items]        
Total interest expense $ 7,760 $ 4,500 $ 22,810 $ 16,302
Convertible Senior Secured Notes due December 2024        
Debt Instrument [Line Items]        
Contractual interest expense 3,105   9,315  
Amortization of debt issuance costs 204   585  
Amortization of debt discount 2,663   7,647  
Total interest expense 5,972   17,547  
Convertible Senior Notes Due June 2021        
Debt Instrument [Line Items]        
Contractual interest expense 302 1,509 906 4,528
Amortization of debt issuance costs 50 241 150 713
Amortization of debt discount 495 2,360 1,467 6,997
Total interest expense $ 847 $ 4,110 $ 2,523 $ 12,238
v3.20.2
Leases - Additional Information (Details)
3 Months Ended 9 Months Ended
Mar. 31, 2020
Item
Sep. 30, 2020
ft²
Item
Dec. 31, 2018
ft²
Oct. 31, 2016
ft²
Dec. 31, 2014
ft²
Jun. 30, 2011
ft²
Operating Lease Information            
Operating lease description   Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred, if any. Our leases have remaining lease terms of 2 years to 7 years, some of which include options to extend the lease term for up to 15 years, and some of which include options to terminate the lease within 2 years.        
Operating lease renewal option   true        
Operating lease termination option   true        
Termination option period   2 years        
Operating lease renewal term, description   one or more options to renew, with renewal options ranging from 5 to 15 years        
Operating lease termination option   One of our leases also includes an option to early terminate the lease within 2 years        
Operating lease weighted-average remaining lease term   3 years 10 months 24 days        
Operating lease weighted-average discount rate   7.14%        
Ardsley, New York | Office and Laboratory Space            
Operating Lease Information            
Operating lease renewal option   true        
Lease option to extend term   5 years        
Operating lease termination option   true        
Termination option period   10 years        
Operating lease renewal term, description   The Company has options to extend the term of the lease for three additional five-year periods        
Operating lease termination option   Company has an option to terminate the lease after 10 years subject to payment of an early termination fee        
Lease term           15 years
Area of leased property           138,000
Additional Lease Option Rights Exercised (In Square Feet)         25,405  
Number of additional periods | Item   3        
Chelsea, Massachusetts | Manufacturing Facility            
Operating Lease Information            
Area of leased property     95,000      
Chelsea, Massachusetts | Manufacturing Facility | Civitas Therapeutics            
Operating Lease Information            
Lease option to extend term 5 years          
Area of leased property   90,000        
Number of additional periods | Item 2          
Lease expiration date Dec. 31, 2025          
Waltham, MA | Office and Laboratory Space            
Operating Lease Information            
Lease term       10 years    
Area of leased property       26,000    
Minimum            
Operating Lease Information            
Operating lease remaining lease term   2 years        
Operating lease renewal term   5 years        
Maximum            
Operating Lease Information            
Operating lease remaining lease term   7 years        
Lease option to extend term   15 years        
Termination option period   2 years        
Operating lease renewal term   15 years        
v3.20.2
Leases - Schedule of ROU Assets and Lease Liabilities Related to Operating Leases (Details) - USD ($)
$ in Thousands
Sep. 30, 2020
Dec. 31, 2019
Sep. 30, 2019
Leases [Abstract]      
Right-of-use assets $ 19,805 $ 23,450 $ 24,675
Current lease liabilities 7,893 7,746 7,696
Non-current lease liabilities $ 18,747 $ 22,996 $ 24,393
v3.20.2
Leases - Components of Lease Costs (Details) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Leases [Abstract]        
Operating lease cost $ 1,775 $ 1,776 $ 5,572 $ 5,293
Variable lease cost 1,052 1,119 2,687 3,544
Short-term lease cost 443 440 1,248 1,094
Total lease cost $ 3,270 $ 3,335 $ 9,507 $ 9,931
v3.20.2
Leases - Schedule of Future Minimum Commitments under all Non-Cancelable Operating Leases (Details)
$ in Thousands
Sep. 30, 2020
USD ($)
Leases [Abstract]  
2020 (excluding the nine months ended September 30, 2020) $ 1,951
2021 7,944
2022 10,024
2023 3,097
2024 3,184
Later years 4,594
Total lease payments 30,794
Less: Imputed interest (4,155)
Present value of lease liabilities $ 26,639
v3.20.2
Leases - Summary of Supplemental Cash Flow Information Related to Operating Leases (Details) - USD ($)
$ in Thousands
9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Operating cash flow information:    
Cash paid for amounts included in the measurement of lease liabilities $ 5,818 $ 5,605
Non-cash activity:    
Right-of-use assets obtained in exchange for lease obligations   $ 770
v3.20.2
Commitments and Contingencies - Additional Information (Detail)
$ in Millions
Sep. 30, 2020
USD ($)
Commitments And Contingencies Disclosure [Abstract]  
liability related to dispute $ 2