HALOZYME THERAPEUTICS INC, 10-K filed on 2/20/2018
Annual Report
Document and Entity Information (USD $)
In Billions, except Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Feb. 13, 2018
Jun. 30, 2017
Document Information [Line Items]
 
 
 
Entity Registrant Name
HALOZYME THERAPEUTICS INC. 
 
 
Trading Symbol
HALO 
 
 
Entity Central Index Key
0001159036 
 
 
Document Type
10-K 
 
 
Document Period End Date
Dec. 31, 2017 
 
 
Amendment Flag
false 
 
 
Document Fiscal Year Focus
2017 
 
 
Document Fiscal Period Focus
FY 
 
 
Current Fiscal Year End Date
--12-31 
 
 
Entity Well-known Seasoned Issuer
Yes 
 
 
Entity Voluntary Filers
No 
 
 
Entity Current Reporting Status
Yes 
 
 
Entity Filer Category
Large Accelerated Filer 
 
 
Entity Public Float
 
 
$ 1.3 
Entity Common Stock, Shares Outstanding
 
143,076,590 
 
Consolidated Balance Sheets (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2017
Dec. 31, 2016
Current assets:
 
 
Cash and cash equivalents
$ 168,740 
$ 66,764 
Marketable securities, available-for-sale
300,474 
138,217 
Accounts receivable, net
22,133 
15,680 
Inventories
5,146 
14,623 
Prepaid expenses and other assets
13,879 
21,248 
Total current assets
510,372 
256,532 
Property and equipment, net
3,520 
4,264 
Prepaid expenses and other assets
5,553 
219 
Restricted cash
500 
500 
Total assets
519,945 
261,515 
Current liabilities:
 
 
Accounts payable
7,948 
3,578 
Accrued expenses
39,601 
28,821 
Deferred revenue, current portion
6,568 
4,793 
Current portion of long-term debt, net
77,211 
17,393 
Total current liabilities
131,328 
54,585 
Deferred revenue, net of current portion
54,297 
39,825 
Long-term debt, net
125,140 
199,228 
Other long-term liabilities
814 
358 
Commitments and contingencies (Note 9)
   
   
Stockholders' equity (deficit):
 
 
Preferred stock - $0.001 par value; 20,000 shares authorized; no shares issued and outstanding
0 
0 
Common stock - $0.001 par value; 200,000 shares authorized; 142,789 and 129,502 shares issued and outstanding at December 31, 2017 and 2016, respectively
143 
130 
Additional paid-in capital
731,044 
552,737 
Accumulated other comprehensive loss
(450)
(6)
Accumulated deficit
(522,371)
(585,342)
Total stockholders' equity (deficit)
208,366 
(32,481)
Total liabilities and stockholders' equity (deficit)
$ 519,945 
$ 261,515 
Consolidated Balance Sheets (Parenthetical) (USD $)
In Thousands, except Per Share data, unless otherwise specified
Dec. 31, 2017
Dec. 31, 2016
Statement of Financial Position [Abstract]
 
 
Preferred stock, par value
$ 0.001 
$ 0.001 
Preferred stock, shares authorized
20,000 
20,000 
Preferred stock, shares issued
0 
0 
Preferred stock, shares outstanding
0 
0 
Common stock, par value
$ 0.001 
$ 0.001 
Common stock, shares authorized
200,000 
200,000 
Common stock, shares issued
142,789 
129,502 
Common stock, shares outstanding
142,789 
129,502 
Consolidated Statements of Operations (USD $)
In Thousands, except Per Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Revenues:
 
 
 
Product sales, net
$ 50,396 
$ 53,392 
$ 46,082 
Royalties
63,507 
50,984 
30,975 
Revenues under collaborative agreements
202,710 
42,315 
58,000 
Total revenues
316,613 
146,691 
135,057 
Operating expenses:
 
 
 
Cost of product sales
31,152 
33,206 
29,245 
Research and development
150,643 
150,842 
93,236 
Selling, general and administrative
53,816 
45,853 
40,028 
Total operating expenses
235,611 
229,901 
162,509 
Operating income (loss)
81,002 
(83,210)
(27,452)
Other income (expense):
 
 
 
Investment and other income, net
2,592 
1,326 
422 
Interest expense
(21,984)
(19,977)
(5,201)
Income (loss) before income taxes
61,610 
(101,861)
(32,231)
Income tax (benefit) expense
(1,361)
1,162 
0 
Net income (loss)
$ 62,971 
$ (103,023)
$ (32,231)
Net income (loss) per share, Basic
$ 0.46 
$ (0.81)
$ (0.25)
Net income (loss) per share, Diluted
$ 0.45 
$ (0.81)
$ (0.25)
Shares used in computing basic net income (loss) per share
136,419 
127,964 
126,704 
Shares used in computing diluted net income (loss) per share
139,068 
127,964 
126,704 
Consolidated Statements of Comprehensive Loss (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Statement of Comprehensive Income [Abstract]
 
 
 
Net income (loss)
$ 62,971 
$ (103,023)
$ (32,231)
Other comprehensive income (loss):
 
 
 
Unrealized (loss) gain on marketable securities
(430)
93 
(58)
Foreign currency translation adjustment
(14)
0 
0 
Total comprehensive income (loss)
$ 62,527 
$ (102,930)
$ (32,289)
Consolidated Statements of Cash Flows (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Operating activities:
 
 
 
Net income (loss)
$ 62,971 
$ (103,023)
$ (32,231)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
 
 
 
Share-based compensation
30,670 
25,585 
20,838 
Depreciation and amortization
2,161 
2,410 
1,700 
Non-cash interest expense
1,761 
2,896 
1,243 
Payment-in-kind Interest expense on long-term debt
0 
13,184 
879 
(Accretion of discounts) amortization of premiums on marketable securities, net
(303)
552 
0 
Loss on disposal of equipment
46 
8 
8 
Deferral of unearned revenue
22,759 
701 
4,379 
Recognition of deferred revenue
(6,512)
(9,304)
(5,789)
Deferral of rent expense
13 
0 
441 
Recognition of deferred rent
(185)
(370)
(276)
Other
(16)
0 
0 
Changes in operating assets and liabilities:
 
 
 
Accounts receivable, net
(6,453)
16,730 
(23,261)
Inventories
9,477 
(5,134)
(3,083)
Prepaid expenses and other assets
2,035 
5,626 
(15,774)
Accounts payable and accrued expenses
15,629 
(244)
13,866 
Net cash provided by (used in) operating activities
134,053 
(50,383)
(37,083)
Investing activities:
 
 
 
Purchases of marketable securities
(398,187)
(155,412)
(71,482)
Proceeds from maturities of marketable securities
235,805 
81,783 
79,730 
Purchases of property and equipment
(1,350)
(3,137)
(2,360)
Net cash (used in) provided by investing activities
(163,732)
(76,766)
5,888 
Financing activities:
 
 
 
Proceeds from issuance of common stock, net
134,874 
0 
0 
Proceeds from issuance of long-term debt, net
0 
203,006 
0 
Repayment of long-term debt
(15,995)
(54,250)
0 
Proceeds from issuance of common stock under equity incentive plans, net of taxes paid related to net share settlement
12,776 
1,865 
13,098 
Net cash provided by financing activities
131,655 
150,621 
13,098 
Net increase (decrease) in cash, cash equivalents and restricted cash
101,976 
23,472 
(18,097)
Cash, cash equivalents and restricted cash beginning of period
67,264 
43,792 
61,889 
Cash, cash equivalents and restricted cash end of period
169,240 
67,264 
43,792 
Interest Paid
20,295 
3,886 
3,775 
Income Taxes Paid
3,015 
1,441 
0 
Amounts accrued for purchases of property and equipment
$ 189 
$ 75 
$ 473 
Consolidated Statements of Stockholders' Equity (Deficit) Statement (USD $)
In Thousands, except Share data
Total
Common Stock [Member]
Additional Paid-in Capital [Member]
AOCI Attributable to Parent [Member]
Retained Earnings [Member]
Total stockholders' equity (deficit) at Dec. 31, 2014
$ 41,352 
$ 126 
$ 491,694 
$ (41)
$ (450,427)
Shares outstanding at Dec. 31, 2014
 
125,721,000 
 
 
 
Adjustment to beginning retained earnings
0 
 
(339)
 
339 
Share-based Compensation
20,838 
 
20,838 
 
 
Issuance of common stock pursuant to exercise of stock options and vesting of restricted stock units and performance restricted stock units, net
 
2,056,000 
 
 
 
Value, Stock Options Exercised
13,098 
2 
13,096 
 
 
Shares, Restricted Stock Award
 
375,000 
 
 
 
Value, Restricted Stock Award
0 
0 
0 
 
 
Other Comprehensive Income (Loss)
(58)
 
 
(58)
 
Net income (loss)
(32,231)
 
 
 
 
Total stockholders' equity (deficit) at Dec. 31, 2015
42,999 
128 
525,628 
(99)
(482,658)
Shares outstanding at Dec. 31, 2015
 
128,152,000 
 
 
 
Share-based Compensation
25,585 
 
25,585 
 
 
Issuance of common stock pursuant to exercise of stock options and vesting of restricted stock units and performance restricted stock units, net
 
570,000 
 
 
 
Value, Stock Options Exercised
1,948 
1 
1,947 
 
 
Shares, Restricted Stock Award
 
780,000 
 
 
 
Value, Restricted Stock Award
(83)
1 
(84)
 
 
Other Comprehensive Income (Loss)
93 
 
 
93 
 
Net income (loss)
(103,023)
 
 
 
 
Total stockholders' equity (deficit) at Dec. 31, 2016
(32,481)
130 
552,737 
(6)
(585,342)
Shares outstanding at Dec. 31, 2016
 
129,502,000 
 
 
 
Share-based Compensation
30,670 
 
30,670 
 
 
Shares, New Issues
11,500,000 
11,500,000 
 
 
 
Value, New Issues
134,874 
11 
134,863 
 
 
Issuance of common stock pursuant to exercise of stock options and vesting of restricted stock units and performance restricted stock units, net
 
1,796,000 
 
 
 
Value, Stock Options Exercised
12,776 
2 
12,774 
 
 
Shares, Restricted Stock Award
 
(9,000)
 
 
 
Value, Restricted Stock Award
0 
0 
0 
 
 
Other Comprehensive Income (Loss)
(444)
 
 
(444)
 
Net income (loss)
62,971 
 
 
 
 
Total stockholders' equity (deficit) at Dec. 31, 2017
$ 208,366 
$ 143 
$ 731,044 
$ (450)
$ (522,371)
Shares outstanding at Dec. 31, 2017
 
142,789,000 
 
 
 
Organization and Business
Organization and Business
Organization and Business
Halozyme Therapeutics, Inc. is a biotechnology company focused on developing and commercializing novel oncology therapies. We are seeking to translate our unique knowledge of the tumor microenvironment to create therapies that have the potential to improve cancer patient survival. Our research primarily focuses on human enzymes that alter the extracellular matrix and tumor microenvironment. The extracellular matrix is a complex matrix of proteins and carbohydrates surrounding the cell that provides structural support in tissues and orchestrates many important biological activities, including cell migration, signaling and survival. Over many years, we have developed unique technology and scientific expertise enabling us to pursue this target-rich environment for the development of therapies.
Our proprietary enzymes are used to facilitate the delivery of injected drugs and fluids, potentially enhancing the efficacy and the convenience of other drugs or can be used to alter tissue structures for potential clinical benefit. We exploit our technology and expertise using a two pillar strategy that we believe enables us to manage risk and cost by: (1) developing our own proprietary products in therapeutic areas with significant unmet medical needs, with a focus on oncology, and (2) licensing our technology to biopharmaceutical companies to collaboratively develop products that combine our technology with the collaborators’ proprietary compounds.
The majority of our approved product and product candidates are based on rHuPH20, our patented recombinant human hyaluronidase enzyme. rHuPH20 is the active ingredient in our first commercially approved product, Hylenex® recombinant, and it works by temporarily breaking down hyaluronan (or “HA”), a naturally occurring complex carbohydrate that is a major component of the extracellular matrix in tissues throughout the body such as skin and cartilage. We believe this temporary degradation creates an opportunistic window for the improved subcutaneous delivery of injectable biologics, such as monoclonal antibodies and other large therapeutic molecules, as well as small molecules and fluids. We refer to the application of rHuPH20 to facilitate the delivery of other drugs or fluids as our ENHANZE® Technology. We license the ENHANZE Technology to form collaborations with biopharmaceutical companies that develop or market drugs requiring or benefiting from injection via the subcutaneous route of administration.
We currently have ENHANZE collaborations with F. Hoffmann-La Roche, Ltd. and Hoffmann-La Roche, Inc. (“Roche”), Baxalta US Inc. and Baxalta GmbH (Baxalta Incorporated was acquired by Shire plc in June 2016) (“Baxalta”), Pfizer Inc. (“Pfizer”), Janssen Biotech, Inc. (“Janssen”), AbbVie, Inc. (“AbbVie”), Eli Lilly and Company (“Lilly”), Bristol-Myers Squibb Company (“BMS”) and Alexion Pharma Holding (“Alexion”).We receive royalties from two of these collaborations, including royalties from sales of one product from the Baxalta collaboration and two products from the Roche collaboration. Future potential revenues from the sales and/or royalties of our approved products, product candidates, and ENHANZE collaborations will depend on the ability of Halozyme and our collaborators to develop, manufacture, secure and maintain regulatory approvals for approved products and product candidates and commercialize product candidates.
Our proprietary development pipeline consists primarily of pre-clinical and clinical stage product candidates in oncology. Our lead oncology program is Pegvorhyaluronidase alfa (“PEGPH20”, PEGylated recombinant human hyaluronidase), a molecular entity we are developing in combination with currently approved cancer therapies as a candidate for the systemic treatment of tumors that accumulate HA. We have demonstrated that when HA accumulates in a tumor, it can cause higher pressure in the tumor, reducing blood flow into the tumor and with that, reduced access of cancer therapies to the tumor. PEGPH20 has been demonstrated in animal models to work by temporarily degrading HA surrounding cancer cells resulting in reduced pressure and increased blood flow to the tumor thereby enabling increased amounts of anticancer treatments administered concomitantly gaining access to the tumor. Through our efforts and efforts of our partners and collaborators, we are currently in Phase 3 clinical testing for PEGPH20 with ABRAXANE® (nab-paclitaxel) and gemcitabine in stage IV pancreatic ductal adenocarcinoma (“PDA”) (HALO 109-301), in Phase 1b clinical testing for PEGPH20 with KEYTRUDA® (pembrolizumab) in non-small cell lung cancer and gastric cancer (HALO 107-101), in Phase 1b/2 clinical testing for PEGPH20 with HALAVEN® (eribulin) in patients treated with up to two lines of prior therapy for HER2-negative metastatic breast cancer, in Phase 1b/2 clinical testing for PEGPH20 with Tecentriq® (atezolizumab) in patients with previously treated metastatic PDA, in Phase 1b/2 clinical testing for PEGPH20 with Tecentriq in patients with gastric cancer and in Phase 1b/2 clinical testing for PEGPH20 with Tecentriq in patients with cholangiocarcinoma and gall bladder cancer (HALO 110-101/MATRIX).
Except where specifically noted or the context otherwise requires, references to “Halozyme,” “the Company,” “we,” “our,” and “us” in these notes to condensed consolidated financial statements refer to Halozyme Therapeutics, Inc. and its wholly owned subsidiary, Halozyme, Inc., and Halozyme, Inc.’s wholly owned subsidiaries, Halozyme Holdings Ltd., Halozyme Royalty LLC, Halozyme Switzerland GmbH and Halozyme Switzerland Holdings GmbH.
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies
Basis of Presentation
The consolidated financial statements include the accounts of Halozyme Therapeutics, Inc. and our wholly owned subsidiary, Halozyme, Inc., and Halozyme, Inc.’s wholly owned subsidiaries, Halozyme Holdings Ltd., Halozyme Royalty LLC, Halozyme Switzerland GmbH and Halozyme Switzerland Holdings GmbH. All intercompany accounts and transactions have been eliminated.
Use of Estimates
The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) requires management to make estimates and assumptions that affect the amounts reported in our consolidated financial statements and accompanying notes. On an ongoing basis, we evaluate our estimates and judgments, which are based on historical and anticipated results and trends and on various other assumptions that management believes to be reasonable under the circumstances. By their nature, estimates are subject to an inherent degree of uncertainty and, as such, actual results may differ from management’s estimates.
Cash Equivalents and Marketable Securities
Cash equivalents consist of highly liquid investments, readily convertible to cash, that mature within ninety days or less from the date of purchase. As of December 31, 2017, our cash equivalents consisted of money market funds and commercial paper.
Marketable securities are investments with original maturities of more than ninety days from the date of purchase that are specifically identified to fund current operations. Marketable securities are considered available-for-sale. These investments are classified as current assets, even though the stated maturity date may be one year or more beyond the current balance sheet date which reflects management’s intention to use the proceeds from the sale of these investments to fund our operations, as necessary. Such available-for-sale investments are carried at fair value with unrealized gains and losses recorded in other comprehensive gain (loss) and included as a separate component of stockholders’ equity (deficit). The cost of marketable securities is adjusted for amortization of premiums or accretion of discounts to maturity, and such amortization or accretion is included in investment and other income, net in the condensed consolidated statements of operations. We use the specific identification method for calculating realized gains and losses on marketable securities sold. Realized gains and losses and declines in value judged to be other-than-temporary on marketable securities, if any, are included in investment and other income, net in the consolidated statements of operations.
Restricted Cash
Under the terms of the leases of our facilities, we are required to maintain letters of credit as security deposits during the terms of such leases. At December 31, 2017 and 2016, restricted cash of $0.5 million was pledged as collateral for the letters of credit.
Fair Value of Financial Instruments
The authoritative guidance for fair value measurements establishes a three tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.
Our financial instruments include cash equivalents, available-for-sale marketable securities, accounts receivable, prepaid expenses and other assets, accounts payable, accrued expenses and long-term debt. Fair value estimates of these instruments are made at a specific point in time, based on relevant market information. These estimates may be subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. The carrying amount of cash equivalents, accounts receivable, prepaid expenses and other assets, accounts payable and accrued expenses are generally considered to be representative of their respective fair values because of the short-term nature of those instruments. Based on Level 3 inputs and the borrowing rates currently available for loans with similar terms, we believe the fair value of long-term debt approximates its carrying value.
Available-for-sale marketable securities consist of corporate debt securities, U.S. Treasury securities and commercial paper, and are measured at fair value using Level 1 and Level 2 inputs. Level 2 financial instruments are valued using market prices on less active markets and proprietary pricing valuation models with observable inputs, including interest rates, yield curves, maturity dates, issue dates, settlement dates, reported trades, broker-dealer quotes, issue spreads, benchmark securities or other market related data. We obtain the fair value of Level 2 investments from our investment manager, who obtains these fair values from a third-party pricing source. We validate the fair values of Level 2 financial instruments provided by our investment manager by comparing these fair values to a third-party pricing source.
Concentrations of Credit Risk, Sources of Supply and Significant Customers
We are subject to credit risk from our portfolio of cash equivalents and marketable securities. These investments were made in accordance with our investment policy which specifies the categories, allocations, and ratings of securities we may consider for investment. The primary objective of our investment activities is to preserve principal while at the same time maximizing the income we receive without significantly increasing risk. We maintain our cash and cash equivalent balances with one major commercial bank and marketable securities with another financial institution. Deposits held with the financial institutions exceed the amount of insurance provided on such deposits. We are exposed to credit risk in the event of a default by the financial institutions holding our cash, cash equivalents and marketable securities to the extent recorded on the consolidated balance sheets.
We are also subject to credit risk from our accounts receivable related to our product sales and revenues under our license and collaborative agreements. We have license and collaborative agreements with pharmaceutical companies under which we receive payments for license fees, milestone payments for specific achievements designated in the collaborative agreements, reimbursements of research and development services and supply of bulk formulation of rHuPH20. In addition, we sell Hylenex® recombinant in the United States to a limited number of established wholesale distributors in the pharmaceutical industry. Credit is extended based on an evaluation of the customer’s financial condition, and collateral is not required. Management monitors our exposure to accounts receivable by periodically evaluating the collectibility of the accounts receivable based on a variety of factors including the length of time the receivables are past due, the financial health of the customer and historical experience. Based upon the review of these factors, we recorded no allowance for doubtful accounts at December 31, 2017 and 2016. Approximately 86% of the accounts receivable balance at December 31, 2017 represents amounts due from Roche and Baxalta. Approximately 81% of the accounts receivable balance at December 31, 2016 represents amounts due from Roche and Baxalta.
The following table indicates the percentage of total revenues in excess of 10% with any single customer:
 
 
Year Ended December 31,
 
 
2017
 
2016
 
2015
Roche
 
38%
 
63%
 
42%
BMS
 
32%
 
—
 
—
Alexion
 
13%
 
—
 
—
Baxalta
 
7%
 
12%
 
7%
Lilly
 
—
 
6%
 
19%
AbbVie
 
—
 
4%
 
17%
We attribute revenues under collaborative agreements, including royalties, to the individual countries where the collaborator is headquartered. We attribute revenues from product sales to the individual countries to which the product is shipped. Worldwide revenues from external customers are summarized by geographic location in the following table (in thousands):
 
 
Year Ended December 31,
 
 
2017
 
2016
 
2015
United States
 
$
196,274

 
$
52,292

 
$
77,149

Switzerland
 
119,136

 
93,067

 
57,136

All other foreign
 
1,203

 
1,332

 
772

Total revenues
 
$
316,613

 
$
146,691

 
$
135,057


As of December 31, 2017 and 2016, we had less than $0.1 million of research equipment in Germany.
We rely on two third-party manufacturers for the supply of bulk rHuPH20 for use in the manufacture of Hylenex recombinant and our other collaboration products and product candidates. Payments due to these suppliers represented 4% and 13% of the accounts payable balance at December 31, 2017 and 2016, respectively. We also rely on a third-party manufacturer for the fill and finish of Hylenex recombinant product under a contract. Payments due to this supplier represented 1% and 2% of the accounts payable balance at December 31, 2017 and 2016, respectively.
Accounts Receivable, Net
Accounts receivable is recorded at the invoiced amount and is non-interest bearing. Accounts receivable is recorded net of allowances for doubtful accounts, cash discounts for prompt payment, distribution fees and chargebacks. We recorded no allowance for doubtful accounts at December 31, 2017 and 2016 as the collectibility of accounts receivable was reasonably assured.
Inventories
Inventories are stated at lower of cost or net realizable value. Cost is determined on a first-in, first-out basis. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Inventories are reviewed periodically for potential excess, dated or obsolete status. We evaluate the carrying value of inventories on a regular basis, taking into account such factors as historical and anticipated future sales compared to quantities on hand, the price we expect to obtain for products in their respective markets compared with historical cost and the remaining shelf life of goods on hand.
Prior to receiving marketing approval from the U.S. Food and Drug Administration (“FDA”) or comparable regulatory agencies in foreign countries, costs related to purchases of bulk rHuPH20 and raw materials and the manufacturing of the product candidates are recorded as research and development expense. All direct manufacturing costs incurred after receiving marketing approval are capitalized as inventory. Inventories used in clinical trials are expensed at the time the inventories are packaged for the clinical trials.
As of December 31, 2017 and 2016, inventories consisted of $2.9 million and $2.3 million, respectively, of Hylenex recombinant inventory, net, and $2.2 million and $12.3 million, respectively, of bulk rHuPH20 for use in the manufacture of Baxalta’s and Roche’s collaboration products.
Property and Equipment, Net
Property and equipment are recorded at cost, less accumulated depreciation and amortization. Equipment is depreciated using the straight-line method over its estimated useful life of three years and leasehold improvements are amortized using the straight-line method over the estimated useful life of the asset or the lease term, whichever is shorter.
Impairment of Long-Lived Assets
We account for long-lived assets in accordance with authoritative guidance for impairment or disposal of long-lived assets. Long-lived assets are reviewed for events or changes in circumstances, which indicate that their carrying value may not be recoverable. For the years ended December 31, 2017 and 2016, there was no impairment of the value of long-lived assets.
Deferred Rent
Rent expense is recorded on a straight-line basis over the initial term of the lease. The difference between rent expense accrued and amounts paid under lease agreements is recorded as deferred rent and is included in accrued expenses and other long-term liabilities, as applicable, in the accompanying consolidated balance sheets.
Comprehensive Income (Loss)
Comprehensive income (loss) is defined as the change in equity during the period from transactions and other events and circumstances from non-owner sources.
Revenue Recognition
We generate revenues from product sales and payments received under collaborative agreements. Collaborative agreement payments may include nonrefundable fees at the inception of the agreements, license fees, milestone and event-based payments for specific achievements designated in the collaborative agreements, reimbursements of research and development services and supply of bulk rHuPH20, and/or royalties on sales of products resulting from collaborative arrangements.
We recognize revenues in accordance with the authoritative guidance for revenue recognition. We recognize revenue when all of the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services have been rendered; (3) the seller’s price to the buyer is fixed or determinable; and (4) collectibility is reasonably assured.
Product Sales, Net
Hylenex Recombinant
We sell Hylenex recombinant in the U.S. to wholesale pharmaceutical distributors, who sell the product to hospitals and other end-user customers. Sales to wholesalers provide for selling prices that are fixed on the date of sale, although we offer discounts to certain group purchasing organizations (“GPOs”), hospitals and government programs. The wholesalers take title to the product, bear the risk of loss of ownership and have economic substance to the inventory. Further, we have no significant obligations for future performance to generate pull-through sales.
We have developed sufficient historical experience and data to reasonably estimate future returns and chargebacks of Hylenex recombinant. As a result, we recognize Hylenex recombinant product sales and related cost of product sales at the time title transfers to the wholesalers.
Upon recognition of revenue from product sales of Hylenex recombinant, we record certain sales reserves and allowances as a reduction to gross revenue. These reserves and allowances include amounts for product returns (based primarily on an analysis of historical return patterns), distribution fees, prompt payment discounts, and GPO fees and other discounts and fees.
We recognize product sales reserves and allowances as a reduction of product sales in the same period the related revenue is recognized. Because of the shelf life of Hylenex recombinant and our lengthy return period, there may be a significant period of time between when the product is shipped and when we issue credits on returned product. If actual product return results differ from our estimates, we will be required to make adjustments to these allowances in the future, which could have an effect on product sales revenue and earnings in the period of adjustments.
Bulk rHuPH20
Subsequent to receiving marketing approval from the FDA or comparable regulatory agencies in foreign countries, sales of bulk rHuPH20 for use in collaboration commercial products are recognized as product sales when the materials have met all the specifications required for the customer’s acceptance and title and risk of loss have transferred to the customer. Following the receipt of European marketing approvals of Roche’s Herceptin SC product in August 2013 and MabThera® SC product in March 2014 and Baxalta’s HYQVIA product in May 2013, revenue from the sales of bulk rHuPH20 for these collaboration products has been recognized as product sales.
Revenues under Collaborative Agreements
We have entered into license and collaboration agreements under which our collaborators obtained worldwide rights for the use of our proprietary rHuPH20 enzyme in the development and commercialization of their biologic compounds identified as targets. These agreements may also contain other elements. Pursuant to the terms of these agreements, collaborators could be required to make various payments to us for each target, including nonrefundable upfront license fees, exclusivity fees, payments based on achievement of specified milestones designated in the collaborative agreements, annual maintenance fees, reimbursements of research and development services, payments for supply of bulk rHuPH20 used by the collaborator and/or royalties on sales of products resulting from collaborative agreements.
In order to account for the multiple-element arrangements, we identify the deliverables included within the collaborative agreement and evaluate which deliverables represent units of accounting. We then determine the appropriate method of revenue recognition for each unit based on the nature and timing of the delivery process. Analyzing the arrangement to identify deliverables requires the use of judgment, and each deliverable may be an obligation to deliver services, a right or license to use an asset, or another performance obligation. The deliverables under our collaborative agreements include (i) the license to our rHuPH20 technology, (ii) at the collaborator’s request, research and development services which are reimbursed at contractually determined rates, and (iii) at the collaborator’s request, supply of bulk rHuPH20 which is reimbursed at our cost plus a margin. A delivered item is considered a separate unit of accounting when the delivered item has value to the collaborator on a standalone basis based on the consideration of the relevant facts and circumstances for each arrangement. We base this determination on the collaborators’ ability to use the delivered items on their own without us supplying undelivered items, which we determine taking into consideration factors such as the research capabilities of the collaborator, the availability of research expertise in this field in the general marketplace, and the ability to procure the supply of bulk rHuPH20 from the marketplace.
Arrangement consideration is allocated at the inception of the agreement to all identified units of accounting based on their relative selling price. The relative selling price for each deliverable is determined using vendor specific objective evidence (“VSOE”) of selling price or third-party evidence of selling price if VSOE does not exist. If neither VSOE nor third-party evidence of selling price exists, we use our best estimate of the selling price for the deliverable. The amount of allocable arrangement consideration is limited to amounts that are not contingent upon the delivery of additional items or meeting other specified performance conditions. The consideration received is allocated among the separate units of accounting and the applicable revenue recognition criteria are applied to each of the separate units. Changes in the allocation of the sales price between delivered and undelivered elements can impact revenue recognition but do not change the total revenue recognized under any agreement.
Nonrefundable upfront license fees are recognized upon delivery of the license if facts and circumstances dictate that the license has standalone value from the undelivered items, which generally include research and development services and the manufacture of bulk rHuPH20, the relative selling price allocation of the license is equal to or exceeds the upfront license fee, persuasive evidence of an arrangement exists, our price to the collaborator is fixed or determinable and collectibility is reasonably assured. Upfront license fees are deferred if facts and circumstances dictate that the license does not have standalone value. The determination of the length of the period over which to defer revenue is subject to judgment and estimation and can have an impact on the amount of revenue recognized in a given period.
When collaborators have rights to elect additional targets, the rights are assessed as to whether they represent deliverables at the inception of the arrangement. In assessing these contingent deliverables, we consider whether the right is a substantive option. We consider a right to be a substantive option if the election of the additional targets is not essential to the functionality of the other elements in the arrangement and if we are truly at risk of the right being exercised. If the right is determined to be a substantive option, we further consider whether the right is priced at a significant and incremental discount that should be accounted for as an element of the arrangement. If a right is determined to be a substantive option and is not priced at a significant and incremental discount, it is not treated as a deliverable in the arrangement and receives no allocation at the inception of the arrangement of the original arrangement consideration. The right is then accounted for when and if it is exercised. When collaborators have a right to return targets, the right is assessed as to whether the target may be returned for a refund of the purchase price, for a credit applied to amounts owed, or in exchange for other dissimilar products. We also assess if we have sufficient history to estimate the likelihood of return. If a right of return is considered to exist and we determine there is not sufficient history to estimate the likelihood of return, the consideration allocated to returnable targets is recorded as deferred revenue on the consolidated balance sheet until the right of return is exercised or expires.
Certain of our collaborative agreements provide for milestone payments upon achievement of development and regulatory events and/or specified sales volumes of commercialized products by the collaborator. We account for milestone payments in accordance with the provisions of ASU No. 2010-17, Revenue Recognition - Milestone Method (“Milestone Method of Accounting”). We recognize consideration that is contingent upon the achievement of a milestone in its entirety as revenue in the period in which the milestone is achieved only if the milestone is substantive in its entirety. A milestone is considered substantive when it meets all of the following criteria:
1.
The consideration is commensurate with either the entity’s performance to achieve the milestone or the enhancement of the value of the delivered item(s) as a result of a specific outcome resulting from the entity’s performance to achieve the milestone;
2.
The consideration relates solely to past performance; and
3.
The consideration is reasonable relative to all of the deliverables and payment terms within the arrangement.
A milestone is defined as an event (i) that can only be achieved based in whole or in part on either the entity’s performance or on the occurrence of a specific outcome resulting from the entity’s performance, (ii) for which there is substantive uncertainty at the date the arrangement is entered into that the event will be achieved, and (iii) that would result in additional payments being due to the vendor.
Reimbursements of research and development services are recognized as revenue during the period in which the services are performed as long as there is persuasive evidence of an arrangement, the fee is fixed or determinable and collection of the related receivable is reasonably assured. Revenue from the manufacture of bulk rHuPH20 is recognized when the materials have met all specifications required for the collaborator’s acceptance and title and risk of loss have transferred to the collaborator. We do not directly control when any collaborator will request research and development services or supply of bulk rHuPH20; therefore, we cannot predict when we will recognize revenues in connection with research and development services and supply of bulk rHuPH20.
Since we receive royalty reports 60 days after quarter end, royalty revenue from sales of collaboration products by our collaborators is recognized in the quarter following the quarter in which the corresponding sales occurred.
The collaborative agreements typically provide the collaborators the right to terminate such agreement in whole or on a product-by-product or target-by-target basis at any time upon 30 to 90 days prior written notice to us. There are no performance, cancellation, termination or refund provisions in any of our collaborative agreements that contain material financial consequences to us.
Refer to Note 4, Collaborative Agreements, for further discussion on our collaborative arrangements.
Cost of Product Sales
Cost of product sales consists primarily of raw materials, third-party manufacturing costs, fill and finish costs, freight costs, internal costs and manufacturing overhead associated with the production of Hylenex recombinant and bulk rHuPH20 for use in approved collaboration products. Cost of product sales also consists of the write-down of excess, dated and obsolete inventories and the write-off of inventories that do not meet certain product specifications, if any.
Research and Development Expenses
Research and development expenses include salaries and benefits, facilities and other overhead expenses, external clinical trial expenses, research related manufacturing services, contract services and other outside expenses. Research and development expenses are charged to operating expenses as incurred when these expenditures relate to our research and development efforts and have no alternative future uses. After receiving approval from the FDA or comparable regulatory agencies in foreign countries for a product, costs related to purchases and manufacturing of bulk rHuPH20 for such product are capitalized as inventory. The manufacturing costs of bulk rHuPH20 for the collaboration products, Herceptin SC, MabThera SC (RITUXAN HYCELA™ in the U.S.) and HYQVIA, incurred after the receipt of marketing approvals are capitalized as inventory.
We are obligated to make upfront payments upon execution of certain research and development agreements. Advance payments, including nonrefundable amounts, for goods or services that will be used or rendered for future research and development activities are deferred. Such amounts are recognized as expense as the related goods are delivered or the related services are performed or such time when we do not expect the goods to be delivered or services to be performed.
Milestone payments that we make in connection with in-licensed technology for a particular research and development project that have no alternative future uses (in other research and development projects or otherwise) and therefore no separate economic value are expensed as research and development costs at the time the costs are incurred. We currently have no in-licensed technologies that have alternative future uses in research and development projects or otherwise.
Clinical Trial Expenses
We make payments in connection with our clinical trials under contracts with contract research organizations that support conducting and managing clinical trials. The financial terms of these agreements are subject to negotiation and vary from contract to contract and may result in uneven payment flows. Generally, these agreements set forth the scope of work to be performed at a fixed fee, unit price or on a time and materials basis. A portion of our obligation to make payments under these contracts depends on factors such as the successful enrollment or treatment of patients or the completion of other clinical trial milestones.
Expenses related to clinical trials are accrued based on our estimates and/or representations from service providers regarding work performed, including actual level of patient enrollment, completion of patient studies and progress of the clinical trials. Other incidental costs related to patient enrollment or treatment are accrued when reasonably certain. If the amounts we are obligated to pay under our clinical trial agreements are modified (for instance, as a result of changes in the clinical trial protocol or scope of work to be performed), we adjust our accruals accordingly on a prospective basis. Revisions to our contractual payment obligations are charged to expense in the period in which the facts that give rise to the revision become reasonably certain.
Share-Based Compensation
We record compensation expense associated with stock options, restricted stock awards (“RSAs”), restricted stock units (“RSUs”), and RSUs with performance conditions (“PRSUs”) in accordance with the authoritative guidance for stock-based compensation. The cost of employee services received in exchange for an award of an equity instrument is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense on a straight-line basis over the requisite service period of the award. Share-based compensation expense for an award with a performance condition is recognized when the achievement of such performance condition is determined to be probable. If the outcome of such performance condition is not determined to be probable or is not met, no compensation expense is recognized and any previously recognized compensation expense is reversed. Forfeitures are recognized as a reduction of share-based compensation expense as they occur.
Income Taxes
We provide for income taxes using the liability method. Under this method, deferred income tax assets and liabilities are determined based on the differences between the financial statement carrying amounts of existing assets and liabilities at each year end and their respective tax bases and are measured using enacted tax rates in effect for the year in which the differences are expected to affect taxable income. Significant judgment is required by management to determine our provision for income taxes, our deferred tax assets and liabilities, and the valuation allowance to record against our net deferred tax assets, which are based on complex and evolving tax regulations throughout the world. Deferred tax assets and other tax benefits are recorded when it is more likely than not that the position will be sustained upon audit. While we have begun to utilize certain of our net operating losses, we have not yet established a track record of profitability. Accordingly, valuation allowances have been recorded to reduce our net deferred tax assets to zero, with the exception of the alternative minimum tax ("AMT") credit carryover. Under the Tax Cuts and Jobs Act enacted in December 2017, the AMT credit carryover will either be utilized, or if unutilized fully refunded in 2022. For all other deferred tax assets the valuation allowance will reduce the net value to zero until such time as we can demonstrate an ability to realize them.
Net Income (Loss) Per Share
Basic net income (loss) per common share is computed by dividing net income (loss) for the period by the weighted average number of common shares outstanding during the period, without consideration for common stock equivalents. Outstanding stock options, unvested RSAs, unvested RSUs and unvested PRSUs are considered common stock equivalents and are only included in the calculation of diluted earnings per common share when net income is reported and their effect is dilutive. For the years ended December 31, 2017, 2016 and 2015, approximately 7.1 million, 13.8 million, and 9.8 million shares, respectively, of outstanding stock options, unvested RSAs, unvested RSUs and unvested PRSUs were excluded from the calculation of diluted net income (loss) per common share because their effect was anti-dilutive. A reconciliation of the numerators and the denominators of the basic and diluted net income (loss) per common share computations is as follows (in thousands, except per share amounts):
 
 
Year Ended December 31,
 
 
2017
 
2016
 
2015
Numerator:
 
 
 
 
 
 
Net income (loss)
 
$
62,971

 
$
(103,023
)
 
$
(32,231
)
Denominator:
 
 
 
 
 
 
Weighted average common shares outstanding for basic
net income (loss) per share
 
136,419

 
127,964

 
126,704

Net effect of dilutive common stock equivalents
 
2,649

 
—

 
—

Weighted average common shares outstanding for diluted
net income (loss) per share
 
139,068

 
127,964

 
126,704

Net income (loss) per share:
 
 
 
 
 
 
Basic
 
$
0.46

 
$
(0.81
)
 
$
(0.25
)
Diluted
 
$
0.45

 
$
(0.81
)
 
$
(0.25
)

Segment Information
We operate our business in one segment, which includes all activities related to the research, development and commercialization of our proprietary enzymes. This segment also includes revenues and expenses related to (i) research and development and bulk rHuPH20 manufacturing activities conducted under our collaborative agreements with third parties and (ii) product sales of Hylenex recombinant. The chief operating decision-maker reviews the operating results on an aggregate basis and manages the operations as a single operating segment. Our long-lived assets located in foreign countries had minimal book value as of December 31, 2017 and 2016.
Adoption and Pending Adoption of Recent Accounting Pronouncements
The following table provides a brief description of recently issued accounting standards, those adopted in the current period and those not yet adopted:
Standard
 
Description
 
Effective Date
 
Effect on the Financial
Statements or Other Significant Matters
 
 
 
 
 
 
 
In July 2015, the FASB issued ASU 2015-11, Inventory: Simplifying the Measurement of Inventory.
 
The new guidance requires that for entities that measure inventory using the first-in, first-out method, inventory should be measured at the lower of cost or net realizable value. Topic 330, Inventory, currently requires an entity to measure inventory at the lower of cost or market. Market could be replacement cost, net realizable value, or net realizable value less an approximate normal profit margin. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation.
 
January 1, 2017.
 
The adoption did not have a material impact on our consolidated financial position or results of operations.
 
 
 
 
 
 
 
In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740), Balance Sheet Classification of Deferred Tax Assets
 
The amendments in this update simplify the presentation of deferred income taxes by requiring that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position.

 
January 1, 2017
 
The adoption of this guidance did not have a significant impact on the Company’s financial statements.

 
 
 
 
 
 
 
In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments.

In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows: Restricted Cash.
 
Current U.S. GAAP either is unclear or does not include specific guidance on the eight cash flow classification issues included in ASU 2016-15. The new guidance is an improvement to U.S. GAAP and is intended to reduce the current and potential future diversity in practice. ASU 2016-18 provides additional classification guidance for restricted cash, which requires that restricted cash be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows.
 
January 1, 2018. We have elected to early adopt as of January 1, 2017.
 
Cash and cash equivalents at the beginning-of-period and end-of-period total amounts in the Consolidated Statements of Cash Flows have been adjusted to include $0.5 million of restricted cash for each of the periods presented.
 
 
 
 
 
 
 
Standard
 
Description
 
Effective Date
 
Effect on the Financial
Statements or Other Significant Matters
In January 2016, the FASB issued ASU 2016-01, Financial Instruments - Overall; Recognition and Measurement of Financial Assets and Financial Liabilities.
 
The new guidance supersedes the guidance to classify equity securities with readily determinable fair values into different categories (that is, trading or available-for-sale) and requires equity securities to be measured at fair value with changes in the fair value recognized through net income. The new guidance requires public business entities that are required to disclose fair value of financial instruments measured at amortized cost on the balance sheet to measure that fair value using the exit price notion consistent with Topic 820, Fair Value Measurement.
 
January 1, 2018.
 
We currently do not hold equity securities, and we are evaluating the effect the updated standard will have on our consolidated financial statements and related disclosures.
 
 
 
 
 
 
 
In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). In March, April, May and December 2016, the FASB issued additional guidance related to Topic 606.
 
The new standard will supersede nearly all existing revenue recognition guidance. Under Topic 606, an entity is required to recognize revenue upon transfer of promised goods or services to customers in an amount that reflects the expected consideration to be received in exchange for those goods or services. Topic 606 defines a five-step process in order to achieve this core principle, which may require the use of judgment and estimates, and also requires expanded qualitative and quantitative disclosures relating to the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers, including significant judgments and estimates used. The new standard also defines accounting for certain costs related to origination and fulfillment of contracts with customers, including whether such costs should be capitalized. The new standard permits adoption either by using (i) a full retrospective approach for all periods presented in the period of adoption or (ii) a modified retrospective approach where the new standard is applied in the financial statements starting with the year of adoption. Under both approaches, cumulative impact of the adoption is reflected as an adjustment to retained earnings (accumulated equity (deficit)) as of the earliest date presented in accordance with the new standard.


 
January 1, 2018. Early adoption is permitted.
 
We plan to implement the new guidance on January 1, 2018 using the modified retrospective approach. We have substantially completed our evaluation of the effect that the updated standard will have on our consolidated financial statements and related disclosures. Adoption of the new guidance will impact the timing of recognition of payments related to certain of our license and collaboration agreements (1) and the timing of recognition of our sales-based royalties.(2) This standard will have a material impact on our consolidated financial statements.

 
 
 
 
 
 
 
Standard
 
Description
 
Effective Date
 
Effect on the Financial
Statements or Other Significant Matters
In February 2016, the FASB issued ASU 2016-02, Leases.
 
The new guidance requires lessees to recognize assets and liabilities for most leases and provides enhanced disclosures.
 
January 1, 2019. Early adoption is permitted.
 
We are currently evaluating the effect the updated standard will have on our consolidated financial statements and related disclosures and do not intend to early adopt. We anticipate recognition of additional assets and corresponding liabilities related to our leases on our consolidated balance sheet.
 
 
 
 
 
 
 
In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments
 
The standard amends the impairment model by requiring entities to use a forward-looking approach based on expected losses to estimate credit losses for most financial assets and certain other instruments that aren’t measured at fair value through net income.

 
January 1, 2020
 
The Company does not believe the adoption will have a material impact on our consolidated financial position or results of operations.


_______________
(1)
Under the new standard, we are required to assess whether licenses granted under our collaboration and license agreements are distinct in the context of the agreement from other performance obligations and functional when granted. We expect that license-related amounts, including upfront payments, exclusive designation fees, annual license maintenance fees, additional target fees, development, regulatory and sales-based milestones will be recognized, generally, at a point in time when earned. Currently, these amounts related to certain of our license and collaboration agreements are being amortized over the term of the collaboration agreement. For example, during the year ended December 31, 2017, we recognized revenue from amortization of license payments of $4.1 million. Total deferred revenue related to license payments under collaboration agreements as of December 31, 2017 was $51.8 million, which will be eliminated and recorded as a reduction to our accumulated deficit upon adoption of Topic 606. Under the new standard, license revenues would have totaled $198.4 million for the year ended December 31, 2017.
(2)
Under the new standard, we expect sales-based royalties will be recognized in the quarter they are earned based on estimates, with a true-up to actual results following in the subsequent quarter. Sales-based royalty revenue earned under our collaboration and license agreements is presently recognized when the royalty reports are made available. Upon adoption of Topic 606, we will reduce our accumulated deficit and increase our accounts receivable, net, by the amount earned but not yet reported in our consolidated balance sheet of approximately $19.4 million. In 2017, we recognized royalty revenues of $63.5 million. Under the new standard, royalty revenues would have totaled $68.9 million for the year ended December 31, 2017. We have established a process to estimate sales-based royalty revenues in the quarter in which the sales occur going forward.
Fair Value Measurement (Notes)
Fair Value Disclosures [Text Block]
Fair Value Measurement
Available-for-sale marketable securities consisted of the following (in thousands):
 
 
December 31, 2017
 
 
Amortized Cost
 
Gross Unrealized Gains
 
Gross Unrealized Losses
 
Estimated Fair Value
Corporate debt securities
 
$
117,427

 
$
—

 
$
(235
)
 
$
117,192

U.S. Treasury securities
 
66,601

 
—

 
(201
)
 
66,400

Commercial paper
 
116,882

 
—

 
—

 
116,882

 
 
$
300,910

 
$
—

 
$
(436
)
 
$
300,474


 
 
December 31, 2016
 
 
Amortized Cost
 
Gross Unrealized Gains
 
Gross Unrealized Losses
 
Estimated Fair Value
Corporate debt securities
 
$
40,221

 
$
1

 
$
(15
)
 
$
40,207

U.S. Treasury securities
 
94,002

 
24

 
(16
)
 
94,010

Commercial paper
 
4,000

 
—

 
—

 
4,000

 
 
$
138,223

 
$
25

 
$
(31
)
 
$
138,217


As of December 31, 2017, 28 available-for-sale marketable securities with a fair market value of $183.6 million were in a gross unrealized loss position of $0.4 million, all of which had been in such position for less than 12 months. Based on our review of these marketable securities, we believe we had no other-than-temporary impairments on these securities as of December 31, 2017, because we do not intend to sell these securities and it is not more-likely-than-not that we will be required to sell these securities before the recovery of their amortized cost basis.
Contractual maturities of available-for-sale debt securities are as follows (in thousands):
 
 
December 31, 2017
 
December 31, 2016
 
 
Estimated Fair Value
Due within one year
 
$
213,426

 
$
132,221

After one but within five years
 
87,048

 
5,996

 
 
$
300,474

 
$
138,217


The following table summarizes, by major security type, our cash equivalents and available-for-sale marketable securities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy (in thousands):
 
 
December 31, 2017
 
December 31, 2016
 
 
Level 1
 
Level 2
 
Total estimated fair value
 
Level 1
 
Level 2
 
Total estimated fair value
Cash equivalents:
 
 
 
 
 
 
 
 
 
 
 
 
Money market funds
 
$
142,091

 
$
—

 
$
142,091

 
$
60,916

 
$
—

 
$
60,916

Commercial paper
 
—

 
15,700

 
15,700

 
—

 
—

 
—

Available-for-sale marketable
   securities:
 
 
 
 
 
 
 
 
 
 
 
 
Corporate debt securities
 
—

 
117,192

 
117,192

 
—

 
40,207

 
40,207

U.S. Treasury securities
 
66,400

 
—

 
66,400

 
94,010

 
—

 
94,010

Commercial paper
 
—

 
116,882

 
116,882

 
—

 
4,000

 
4,000

 
 
$
208,491

 
$
249,774

 
$
458,265

 
$
154,926

 
$
44,207

 
$
199,133


There were no transfers between Level 1 and Level 2 of the fair value hierarchy during the year ended December 31, 2017. We had no instruments that were classified within Level 3 as of December 31, 2017 and 2016.
Collaborative Agreements (Notes)
Collaborative Agreements
Collaborative Agreements
Roche Collaboration
In December 2006, we and Roche entered into a collaboration and license agreement, under which Roche obtained a worldwide license to develop and commercialize product combinations of rHuPH20 and up to thirteen Roche target compounds (the “Roche Collaboration”). Roche initially had the exclusive right to apply rHuPH20 to three pre-defined Roche biologic targets with the option to develop and commercialize rHuPH20 with ten additional targets. Roche had the right to exercise this option to identify additional targets for ten years. As of the ten year anniversary in December 2016, Roche had elected a total of eight targets, two of which are exclusive.
In August 2013, Roche received European marketing approval for its collaboration product, Herceptin SC, for the treatment of patients with HER2-positive breast cancer and launched Herceptin SC in the European Union (“EU”) in September 2013. In March 2014, Roche received European marketing approval for its collaboration product, MabThera SC, for the treatment of patients with common forms of non-Hodgkin lymphoma (“NHL”). In June 2014, Roche launched MabThera SC in the EU. In May 2016, Roche announced that the EMA approved Mabthera SC to treat patients with chronic lymphocytic leukemia (“CLL”). In June 2017, the FDA approved Genentech’s (a member of the Roche Group) RITUXAN HYCELA™, a combination of rituximab and rHuPH20 (approved and marketed under the MabThera SC brand in countries outside the U.S.), for CLL and two types of NHL, follicular lymphoma and diffuse large B-cell lymphoma. Following FDA approval, Genentech launched RITUXAN HYCELA in the U.S.
Roche assumes all development, manufacturing, clinical, regulatory, sales and marketing costs under the Roche Collaboration, while we are responsible for the supply of bulk rHuPH20. We are entitled to receive reimbursements for providing research and development services and supplying bulk rHuPH20 to Roche at its request.
Under the terms of the Roche Collaboration, Roche pays us a royalty on each product commercialized under the agreement consisting of a mid-single digit percent of the net sales of such product. Unless terminated earlier in accordance with its terms, the Roche Collaboration continues in effect until the expiration of Roche’s obligation to pay royalties. Roche has the obligation to pay royalties to us with respect to each product commercialized in each country, during the period equal to the longer of: (a) the duration of any valid claim of our patents covering rHuPH20 or other specified patents developed under the Roche Collaboration which valid claim covers the product in such country or (b) ten years following the date of the first commercial sale of such product in such country. In the event such valid claims expire, the royalty rate is reduced for the remaining royalty term.
Payments received from Roche, excluding royalties and reimbursements for providing research and development services and supplying bulk rHuPH20, since inception of the Roche Collaboration are as follows (in thousands):
 
As of December 31, 2017
Upfront license fee payment for the application of rHuPH20 to the initial exclusive targets
$
20,000

Election of additional exclusive targets and annual license maintenance fees for the
   right to designate the remaining targets as exclusive targets
23,000

Clinical development milestone payments
13,000

Regulatory milestone payments
8,000

Sales-based milestone payments
22,000

Total payments received
$
86,000


Due to our continuing involvement obligations (for example, support activities associated with rHuPH20) under the Roche Collaboration, revenues from the upfront payment, exclusive designation fees, annual license maintenance fees and sales-based milestone payments were deferred and are being amortized over the remaining term of the Roche Collaboration.
For each of the years ended December 31, 2017, 2016 and 2015, we recognized $3.3 million of Roche deferred revenues, excluding reimbursements for providing research and development services and supplying bulk rHuPH20, as revenues under collaborative agreements. Total Roche deferred revenues, excluding deferred revenues related to reimbursements for providing research and development services and supplying bulk rHuPH20, were $39.4 million and $35.7 million as of December 31, 2017 and 2016, respectively.
In September 2017, we and Roche entered into an agreement providing Roche the right to develop and commercialize products with one additional exclusive target using our ENHANZE Technology for an upfront payment of $30.0 million (the “2017 Roche Collaboration”). The upfront license payment may be followed by event-based payments subject to Roche’s achievement of specified development, regulatory and sales-based milestones. In addition, Roche will pay royalties to us if products under the collaboration are commercialized consisting of a mid-single digit percent of the net sales of such product. Unless terminated earlier in accordance with its terms, the 2017 Roche Collaboration continues in effect until the expiration of Roche’s obligation to pay royalties. Roche has the obligation to pay royalties to us with respect to each product commercialized in each country, during the period equal to the longer of: (a) the duration of any valid claim of our patents covering rHuPH20 or other specified patents developed under the 2017 Roche Collaboration which valid claim covers the product in such country or (b) ten years following the date of the first commercial sale of such product in such country. In the event such valid claims expire, the royalty rate is reduced for the remaining royalty term. Roche may terminate the agreement prior to expiration for any reason in its entirety upon 90 days prior written notice to us. Upon any such termination, the license granted to Roche (in total or with respect to the terminated target, as applicable) will terminate provided, however, that in the event of expiration of the agreement, the licenses granted will become perpetual, non-exclusive and fully paid.
At the inception of the 2017 Roche Collaboration, we identified the deliverables in the arrangement to include the license, research and development services and supply of bulk rHuPH20 and determined that each individually represent separate units of accounting, because each deliverable has standalone value. The estimated selling prices for the units of accounting we identified were determined based on market conditions, the terms of comparable collaborative arrangements for similar technology in the pharmaceutical and biotech industry and entity-specific factors such as the terms of our previous collaborative agreements, our pricing practices and pricing objectives. The arrangement consideration was allocated to the deliverables based on the relative selling price method and the nature of the research and development services to be performed for the collaborator. The amount allocable to the delivered unit or units of accounting is limited to the amount that is not contingent upon the delivery of additional items or meeting other specified performance conditions (non-contingent amount). As such, we excluded from the allocable arrangement consideration the event-based payments, milestone payments and royalties regardless of the probability of receipt. Based on the results of our analysis, we allocated the $30.0 million to the license fee deliverable. We determined that the upfront payment was earned upon the granting of the worldwide, exclusive right to our technology to Roche. As a result, we recognized the $30.0 million license fee under the 2017 Roche Collaboration as revenues under collaborative agreements for the year ended December 31, 2017.
Baxalta Collaboration
In September 2007, we and Baxalta entered into a collaboration and license agreement, under which Baxalta obtained a worldwide, exclusive license to develop and commercialize HYQVIA, a combination of Baxalta’s current product GAMMAGARD LIQUID™ and our patented rHuPH20 enzyme (the “Baxalta Collaboration”). In 2013, the European Commission granted Baxalta marketing authorization in all EU Member States for the use of HYQVIA (solution for subcutaneous use), a combination of GAMMAGARD LIQUID and rHuPH20 in dual vial units, as replacement therapy for adult patients with primary and secondary immunodeficiencies, and Baxalta launched HYQVIA in the EU. In 2014, Baxalta launched HYQVIA in the U.S following the FDA’s approval of HYQVIA for treatment of adult patients with primary immunodeficiency. In May 2016, Baxalta announced that HYQVIA received a marketing authorization from the European Commission for a pediatric indication, which is being launched in Europe to treat primary and certain secondary immunodeficiencies.
The Baxalta Collaboration is applicable to both kit and formulation combinations. Baxalta assumes all development, manufacturing, clinical, regulatory, sales and marketing costs under the Baxalta Collaboration, while we are responsible for the supply of bulk rHuPH20. We perform research and development activities and supply bulk rHuPH20 at the request of Baxalta, and are reimbursed by Baxalta under the terms of the Baxalta Collaboration. In addition, Baxalta has certain product development and commercialization obligations in major markets identified in the Baxalta Collaboration.
Under the terms of the Baxalta Collaboration, Baxalta pays us a royalty consisting of a mid-single digit percent of the net sales of HYQVIA. Unless terminated earlier in accordance with its terms, the Baxalta Collaboration continues in effect until the expiration of Baxalta’s obligation to pay royalties to us. Baxalta has the obligation to pay royalties to us, with respect to each product commercialized in each country, during the period equal to the longer of: (a) the duration of any valid claim of our patents covering rHuPH20 or other specified patents developed under the Baxalta Collaboration which valid claim covers the product in such country or (b) ten years following the date of the first commercial sale of such product in such country. In the event such valid claims expire, the royalty rate is reduced for the remaining royalty term.
Payments received from Baxalta, excluding royalties and reimbursements for providing research and development services and supplying bulk rHuPH20, since inception of the collaboration agreement are as follows (in thousands):
 
As of December 31, 2017
Upfront license fee payment for the application of rHuPH20 to the initial exclusive target
$
10,000

Regulatory milestone payments
3,000

Sales-based milestone payments
9,000

Total payments received
$
22,000


Due to our continuing involvement obligations (for example, support activities associated with rHuPH20 enzyme), the upfront license fee and sales-based milestone payments were deferred and are being recognized over the term of the Baxalta Collaboration.
For each of the years ended December 31, 2017, 2016 and 2015, we recognized $0.8 million of Baxalta deferred revenues, excluding reimbursements for providing research and development services and supplying bulk rHuPH20, as revenues under collaborative agreements. Total Baxalta deferred revenues, excluding reimbursements for providing research and development services and supplying bulk rHuPH20, were $12.4 million and $8.2 million as of December 31, 2017 and 2016, respectively.
Other Collaborations
In December 2017, we and Alexion entered into a collaboration and license agreement, under which Alexion has the worldwide license to develop and commercialize products combining our patented rHuPH20 enzyme with Alexion proprietary biologics directed at up to four targets (the “Alexion Collaboration”). Targets, once selected, will be on an exclusive, global basis. As of December 31, 2017, Alexion has elected two specific exclusive targets. Alexion has the right to elect up to two additional targets for additional fees. The upfront license payment may be followed by event-based payments subject to Alexion’s achievement of specified development, regulatory and sales-based milestones. In addition, Alexion will pay royalties to us if products under the collaboration are commercialized. Unless terminated earlier in accordance with its terms, the Alexion Collaboration continues in effect until the later of: (i) expiration of the last to expire of the valid claims of or patents covering rHuPH20 or other specified patents developed under the collaboration which valid claim covers a product developed under the collaboration, and (ii) expiration of the last to expire royalty term for a product developed under the collaboration. The royalty term of a product developed under the Alexion Collaboration, with respect to each country, consists of the period equal to the longer of (a) duration of any valid claim of our patent covering rHuPH20 or other specified patents developed under the collaboration which valid claim covers the product in such country or (b) ten years following the date of the first commercial sale of such product in such country. In the event such valid claims expire, the royalty rate is reduced for the remaining royalty term. Alexion may terminate the agreement prior to the expiration for any reason in its entirety upon 90 days prior written notice to us. Upon such termination, the license granted to Alexion (in total or with respect to the terminated target, as applicable) will terminate provided, however, that in the event of expiration of the agreement, the licenses granted will become perpetual, non-exclusive and fully paid.
In September 2017, we and BMS entered into a collaboration and license agreement, effective November 2017, under which BMS has the worldwide license to develop and commercialize products combining our rHuPH20 enzyme with BMS proprietary biologics directed at up to eleven targets (the “BMS Collaboration”). Targets, once selected, will be on an exclusive, global basis, with the exception of one co-exclusive target. As of December 31, 2017, BMS has elected several specified exclusive targets, including programmed death 1 (PD-1), and has the right to elect additional targets, some of which are subject to additional fees. The upfront license payment may be followed by event-based payments subject to BMS’s achievement of specified development, regulatory and sales-based milestones. In addition, BMS will pay royalties to us if products developed under the collaboration are commercialized. Unless terminated earlier in accordance with its terms, the BMS Collaboration continues in effect until the later of: (i) expiration of the last to expire of the valid claims of our patents covering rHuPH20 or other specified patents developed under the collaboration which valid claim covers a product developed under the collaboration, and (ii) expiration of the last to expire royalty term for a product developed under the collaboration. The royalty term of a product developed under the BMS Collaboration, with respect to each country, consists of the period equal to the longer of: (a) the duration of any valid claim of our patents covering rHuPH20 or other specified patents developed under the collaboration which valid claim covers the product in such country or (b) ten years following the date of the first commercial sale of such product in such country. In the event such valid claims expire, the royalty rate is reduced for the remaining royalty term. BMS may terminate the agreement prior to expiration for any reason in its entirety upon prior written notice to us. Upon any such termination, the license granted to BMS (in total or with respect to the terminated target, as applicable) will terminate provided, however, that in the event of expiration of the agreement, the licenses granted will become perpetual, non-exclusive and fully paid.
In December 2015, we and Lilly entered into a collaboration and license agreement, under which Lilly has the worldwide license to develop and commercialize products combining our patented rHuPH20 enzyme with Lilly proprietary biologics directed at up to five targets (the “Lilly Collaboration”). Targets, once selected, will be on an exclusive, global basis, with the exception of one semi-exclusive target. As of December 31, 2017, Lilly has elected two specified exclusive targets and one specified semi-exclusive target. Lilly has the right to elect up to two additional targets for additional fees. The upfront license payment may be followed by event-based payments subject to Lilly’s achievement of specified development, regulatory and sales-based milestones. In addition, Lilly will pay royalties to us if products under the collaboration are commercialized. Unless terminated earlier in accordance with its terms, the Lilly Collaboration continues in effect until the later of: (i) expiration of the last to expire of the valid claims of our patents covering rHuPH20 or other specified patents developed under the collaboration which valid claim covers a product developed under the collaboration, and (ii) expiration of the last to expire royalty term for a product developed under the collaboration. The royalty term of a product developed under the Lilly Collaboration, with respect to each country, consists of the period equal to the longer of: (a) the duration of any valid claim of our patents covering rHuPH20 or other specified patents developed under the collaboration which valid claim covers the product in such country or (b) ten years following the date of the first commercial sale of such product in such country. In the event such valid claims expire, the royalty rate is reduced for the remaining royalty term. Lilly may terminate the agreement prior to expiration for any reason in its entirety upon 60 days prior written notice to us. Upon any such termination, the license granted to Lilly (in total or with respect to the terminated target, as applicable) will terminate provided, however, that in the event of expiration of the agreement, the licenses granted will become perpetual, non-exclusive and fully paid.
In June 2015, we and AbbVie entered into a collaboration and license agreement, under which AbbVie has the worldwide license to develop and commercialize products combining our patented rHuPH20 enzyme with AbbVie proprietary biologics directed at up to nine targets (the “AbbVie Collaboration”). Targets, once selected, will be on an exclusive, global basis. As of December 31, 2017, AbbVie has elected one specified exclusive target, and subsequently returned the target. AbbVie has the right to elect up to eight additional targets for additional fees. The upfront license payment may be followed by event-based payments subject to AbbVie’s achievement of specified development, regulatory and sales-based milestones. In addition, AbbVie will pay tiered royalties to us if products under the collaboration are commercialized. Unless terminated earlier in accordance with its terms, the AbbVie Collaboration continues in effect until the later of: (i) expiration of the last to expire of the valid claims of our patents covering rHuPH20 or other specified patents developed under the collaboration which valid claim covers a product developed under the collaboration, and (ii) expiration of the last to expire royalty term for a product developed under the collaboration. The royalty term of a product developed under the AbbVie Collaboration, with respect to each country, consists of the period equal to the longer of: (a) the duration of any valid claim of our patents covering rHuPH20 or other specified patents developed under the collaboration which valid claim covers the product in such country or (b) ten years following the date of the first commercial sale of such product in such country. In the event such valid claims expire, the royalty rate is reduced for the remaining royalty term. AbbVie may terminate the agreement prior to expiration for any reason in its entirety or on a target-by-target basis upon 90 days prior written notice to us. Upon any such termination, the license granted to AbbVie (in total or with respect to the terminated target, as applicable) will terminate provided, however, that in the event of expiration of the agreement, the licenses granted will become perpetual, non-exclusive and fully paid.
In December 2014, we and Janssen entered into a collaboration and license agreement, under which Janssen has the worldwide license to develop and commercialize products combining our patented rHuPH20 enzyme with Janssen proprietary biologics directed at up to five targets (the “Janssen Collaboration”). Targets, once selected, will be on an exclusive, global basis. As of December 31, 2017, Janssen has elected one specified exclusive target. Janssen has the right to elect four additional targets in the future upon payment of additional fees. In addition, Janssen will pay royalties to us if products under the collaboration are commercialized. Unless terminated earlier in accordance with its terms, the Janssen Collaboration continues in effect until the later of (i) expiration of the last to expire of the valid claims of our patents covering rHuPH20 or other specified patents developed under the collaboration which valid claim covers a product developed under the collaboration, and (ii) expiration of the last to expire royalty term for a product developed under the collaboration. The royalty term of a product developed under the Janssen Collaboration, with respect to each country, consists of the period equal to the longer of: (a) the duration of any valid claim of our patents covering rHuPH20 or other specified patents developed under the collaboration which valid claim covers the product in such country or (b) ten years following the date of the first commercial sale of such product in such country. In the event such valid claims expire, the royalty rate is reduced for the remaining royalty term. Janssen may terminate the agreement prior to expiration for any reason in its entirety or on a product-by-product basis upon 90 days prior written notice to us. Upon any such termination, the license granted to Janssen (in total or with respect to the terminated target, as applicable) will terminate provided, however, that in the event of expiration of the agreement, the licenses granted will become perpetual, non-exclusive and fully paid.
In December 2012, we and Pfizer entered into a collaboration and license agreement, under which Pfizer has the worldwide license to develop and commercialize products combining our patented rHuPH20 enzyme with Pfizer proprietary biologics directed at up to six targets (the “Pfizer Collaboration”). Targets may be selected on an exclusive or non-exclusive basis. As of December 31, 2017, Pfizer has elected five specified exclusive targets and has returned two of its elected targets. Pfizer has the right to elect three additional targets in the future, two of which are contingent on payment of additional fees. In addition, Pfizer will pay royalties to us if products under the collaboration are commercialized. Unless terminated earlier in accordance with its terms, the Pfizer Collaboration continues in effect until the later of (i) expiration of the last to expire of the valid claims of our patents covering rHuPH20 or other specified patents developed under the collaboration which valid claim covers a product developed under the collaboration, and (ii) expiration of the last to expire royalty term for a product developed under the collaboration. The royalty term of a product developed under the Pfizer Collaboration, with respect to each country, consists of the period equal to the longer of: (a) the duration of any valid claim of our patents covering rHuPH20 or other specified patents developed under the collaboration which valid claim covers the product in such country or (b) ten years following the date of the first commercial sale of such product in such country. Royalties are subject to adjustment as set forth in the agreement. Pfizer may terminate the agreement prior to expiration for any reason in its entirety or on a target-by-target basis upon 30 days prior written notice to us. Upon any such termination, the license granted to Pfizer (in total or with respect to the terminated target, as applicable) will terminate, provided, however, that in the event of expiration of the agreement, the licenses granted will become perpetual, non-exclusive and fully paid.
Payments received under collaboration agreements for upfront license fees, license fees for the election of additional targets, maintenance fees and event-based payments since inception of the collaboration agreements are as follows (in thousands):
 
As of December 31, 2017
Alexion Collaboration
$
40,000

BMS Collaboration
105,000

Lilly Collaboration
33,000

AbbVie Collaboration
29,000

Janssen Collaboration
30,250

Pfizer Collaboration
16,500

Total payments received
$
253,750


At the inception of the Pfizer, Janssen, AbbVie, Lilly, BMS and Alexion arrangements, we identified the deliverables in each arrangement to include the license, research and development services and supply of bulk rHuPH20. We have determined that the license, research and development services and supply of bulk rHuPH20 individually represent separate units of accounting, because each deliverable has standalone value. We determined that the rights to elect additional targets in the future upon the payment of additional license fees are substantive options that are not priced at a significant and incremental discount. Therefore, we determined for each collaboration that the rights to elect additional targets are not deliverables at the inception of the arrangement. The estimated selling prices for the units of accounting we identified were determined based on market conditions, the terms of comparable collaborative arrangements for similar technology in the pharmaceutical and biotech industry and entity-specific factors such as the terms of our previous collaborative agreements, our pricing practices and pricing objectives. The arrangement consideration was allocated to the deliverables based on the relative selling price method and the nature of the research and development services to be performed for the collaborator.
The amount allocable to the delivered unit or units of accounting is limited to the amount that is not contingent upon the delivery of additional items or meeting other specified performance conditions (non-contingent amount). As such, we excluded from the allocable arrangement consideration the event-based payments, milestone payments, annual exclusivity fees and royalties regardless of the probability of receipt. Based on the results of our analysis, we allocated the following amounts to the license fee deliverable under the arrangement (in thousands):
 
Consideration allocated to
license fees:
Alexion Collaboration
$
40,000

BMS Collaboration
101,400

Lilly Collaboration
33,000

AbbVie Collaboration
23,000

Janssen Collaboration
15,250

Pfizer Collaboration
12,500

Total consideration allocated to license fees
$
225,150


We determined that the consideration allocated to the license fees were earned upon the granting of the worldwide, exclusive right to our technology to the collaborators in these arrangements. As a result, we recognized the consideration allocated to license fees as revenues under collaborative agreements in the period when such license fees were earned. We recognized revenue related to event-based payments or milestone payments under these collaborations of $15.0 million, $6.0 million, and $1.0 million for the years ended December 31, 2017, 2016 and 2015, respectively.
The collaborators are each solely responsible for the development, manufacturing and marketing of any products resulting from their respective collaborations. We are entitled to receive payments for research and development services and supply of bulk rHuPH20 if requested by any collaborator. We recognize amounts allocated to research and development services as revenues under collaborative agreements as the related services are performed. We recognize amounts allocated to the sales of bulk rHuPH20 as revenues under collaborative agreements or product sales, as appropriate, when such bulk rHuPH20 has met all required specifications by the collaborators and the related title and risk of loss and damages have passed to the collaborators. We cannot predict the timing of delivery of research and development services and bulk rHuPH20 as they are at the collaborators’ requests.
Pursuant to the terms of the Roche Collaboration and the Pfizer Collaboration, certain future payments meet the definition of a milestone in accordance with the Milestone Method of Accounting. We are entitled to receive additional milestone payments under our collaboration agreements with Roche and Pfizer for the successful development of the elected targets in the aggregate of up to $62.5 million upon achievement of specified clinical development milestone events and up to $12.0 million upon achievement of specified regulatory milestone events in connection with specified regulatory filings and receipt of marketing approvals.
Certain Balance Sheet Items (Notes)
Certain Balance Sheet Items
Certain Balance Sheet Items
Accounts receivable, net consisted of the following (in thousands):
 
 
December 31,
2017
 
December 31,
2016
Accounts receivable from product sales to collaborators
 
$
18,475

 
$
7,854

Accounts receivable from revenues under collaborative agreements
 
2,142

 
6,151

Accounts receivable from other product sales
 
2,075

 
2,234

     Subtotal
 
22,692

 
16,239

Allowance for distribution fees and discounts
 
(559
)
 
(559
)
     Total accounts receivable, net
 
$
22,133

 
$
15,680


Inventories consisted of the following (in thousands):
 
 
December 31,
2017
 
December 31,
2016
Raw materials
 
$
377

 
$
761

Work-in-process
 
2,131

 
12,850

Finished goods
 
2,638

 
1,012

     Total inventories
 
$
5,146

 
$
14,623


Prepaid expenses and other assets consisted of the following (in thousands):
 
 
December 31,
2017
 
December 31,
2016
Prepaid manufacturing expenses
 
$
2,337

 
$
9,663

Prepaid research and development expenses
 
7,793

 
8,613

Other prepaid expenses
 
2,585

 
1,661

Other assets
 
6,717

 
1,530

     Total prepaid expenses and other assets
 
19,432

 
21,467

Less long-term portion
 
5,553

 
219

     Total prepaid expenses and other assets, current
 
$
13,879

 
$
21,248


Prepaid manufacturing expenses include slot reservation fees and other amounts paid to contract manufacturing organizations. Such amounts are reclassified to work-in-process inventory once the manufacturing process has commenced.
Property and equipment, net consisted of the following (in thousands):
 
 
December 31,
2017
 
December 31,
2016
Research equipment
 
$
10,970

 
$
10,479

Computer and office equipment
 
3,725

 
3,373

Leasehold improvements
 
2,715

 
2,331

     Subtotal
 
17,410

 
16,183

Accumulated depreciation and amortization
 
(13,890
)
 
(11,919
)
     Property and equipment, net
 
$
3,520

 
$
4,264

Depreciation and amortization expense was approximately $2.2 million , $2.4 million, and $1.7 million for the years ended December 31, 2017, 2016 and 2015, respectively.
Accrued expenses consisted of the following (in thousands):
 
 
December 31,
2017
 
December 31,
2016
Accrued outsourced research and development expenses
 
$
18,757

 
$
9,522

Accrued compensation and payroll taxes
 
13,384

 
11,539

Accrued outsourced manufacturing expenses
 
2,504

 
3,225

Other accrued expenses
 
5,396

 
4,552

     Total accrued expenses
 
40,041

 
28,838

Less long-term portion
 
440

 
17

     Total accrued expenses, current
 
$
39,601

 
$
28,821


Deferred revenue consisted of the following (in thousands):
 
 
December 31,
2017
 
December 31,
2016
Collaborative agreements
 
 
 
 
License fees and event-based payments:
 
 
 
 
Roche
 
$
39,379

 
$
35,709

Other
 
15,999

 
8,209

 
 
55,378

 
43,918

Reimbursement for research and development services
 
—

 
700

Product sales
 
5,487

 
—

Total deferred revenue
 
60,865

 
44,618

Less current portion
 
6,568

 
4,793

Deferred revenue, net of current portion
 
$
54,297

 
$
39,825

Long-Term Debt, Net (Notes)
Long-term Debt
Long-Term Debt, Net
Royalty-backed Loan
In January 2016, through our wholly-owned subsidiary Halozyme Royalty LLC (“Halozyme Royalty”), we received a $150 million loan (the “Royalty-backed Loan”) pursuant to a credit agreement (the “Credit Agreement”) with BioPharma Credit Investments IV Sub, LP and Athyrium Opportunities II Acquisition LP (the “Royalty-backed Lenders”). Under the terms of the Credit Agreement, Halozyme Therapeutics, Inc. transferred to Halozyme Royalty the right to receive royalty payments from the commercial sales of ENHANZE products owed under the Roche Collaboration and Baxalta Collaboration (“Collaboration Agreements”). The royalty payments from the Collaboration Agreements will be used to repay the principal and interest on the loan (the “Royalty Payments”).  The Royalty-backed Loan bears interest at a per annum rate of 8.75% plus the three-month LIBOR rate. The three-month LIBOR rate is subject to a floor of 0.7% and a cap of 1.5%. The interest rate as of December 31, 2017 and 2016 was 10.25% and 9.71%, respectively.
The Credit Agreement provides that none of the Royalty Payments were required to be applied to the Royalty-backed Loan prior to January 1, 2017, 50% of the Royalty Payments are required to be applied to the Royalty-backed Loan between January 1, 2017 and January 1, 2018 and thereafter all Royalty Payments must be applied to the Royalty-backed Loan. However, the amounts available to repay the Royalty-backed Loan are subject to caps of $13.75 million per quarter in 2017, $18.75 million per quarter in 2018, $21.25 million per quarter in 2019 and $22.5 million per quarter in 2020 and thereafter. Amounts available to repay the Royalty-backed Loan will be applied first to pay interest and second to repay principal on the Royalty-backed Loan. Any accrued interest that is not paid on any applicable quarterly payment date, as defined, will be capitalized and added to the principal balance of the Royalty-backed Loan on such date. Halozyme Royalty will be entitled to receive and distribute to Halozyme any Royalty Payments that are not required to be applied to the Royalty-backed Loan or which are in excess of the foregoing caps.
Because the repayment of the term loan is contingent upon the level of Royalty Payments received, the repayment term may be shortened or extended depending on the actual level of Royalty Payments. The final maturity date of the Royalty-backed Loan will be the earlier of (i) the date when principal and interest is paid in full, (ii) the termination of Halozyme Royalty’s right to receive royalties under the Collaboration Agreements, and (iii) December 31, 2050.  Currently, we estimate that the loan will be repaid in the first quarter of 2020. This estimate could be adversely affected and the repayment period could be extended if future royalty amounts are less than currently expected. Under the terms of the Credit Agreement, at any time after January 1, 2019, Halozyme Royalty may, subject to certain limitations, prepay the outstanding principal of the Royalty-backed Loan in whole or in part, at a price equal to 105% of the outstanding principal on the Royalty-backed Loan, plus accrued but unpaid interest. The Royalty-backed Loan constitutes an obligation of Halozyme Royalty, and is non-recourse to Halozyme. Halozyme Royalty retains its right to the Royalty Payments following repayment of the loan.
As of December 31, 2017, we were in compliance with all covenants under the Royalty-backed Loan and there was no material adverse change in our business, operations or financial condition.
During the year ended December 31, 2016, accrued interest in the amount of $13.2 million was capitalized and added to the principal balance of the Royalty-backed Loan. We began making principal and interest payments against the Royalty-backed Loan in the first quarter of 2017 and therefore had no capitalized interest in the year ended December 31, 2017. In addition, we recorded accrued interest, which is included in accrued expenses, of $0.7 million as of December 31, 2017 and 2016, respectively.
In connection with the Royalty-backed Loan, we paid the Royalty-backed Lenders a fee of $1.5 million and incurred additional debt issuance costs totaling $0.4 million, which includes expenses that we paid on behalf of the Royalty-backed Lenders and expenses incurred directly by us. Debt issuance costs and the lender fee have been netted against the debt as of December 31, 2017, and are being amortized over the estimated term of the debt using the effective interest method. For the years ended December 31, 2017 and 2016, the Company recognized interest expense, including amortization of the debt discount, related to the Royalty-backed Loan of $16.4 million and $14.5 million, respectively. The assumptions used in determining the expected repayment term of the debt and amortization period of the issuance costs requires that we make estimates that could impact the short- and long-term classification of these costs, as well as the period over which these costs will be amortized. The outstanding balance of the Royalty-backed Loan as of December 31, 2017 was $146.5 million, net of unamortized debt discount of $0.8 million.
Oxford and SVB Loan and Security Agreement
In December 2013, we entered into an Amended and Restated Loan and Security Agreement (the “Original Loan Agreement”) with Oxford Finance LLC (“Oxford”) and Silicon Valley Bank (“SVB”) (collectively, the “Lenders”), amending and restating in its entirety our previous loan agreement with the Lenders, dated December 2012. The Original Loan Agreement provided for an additional $20 million principal amount of new term loan, bringing the total term loan balance to $50 million. The amended term loan facility was scheduled to mature on January 1, 2018.
In January 2015, we entered into the second amendment to the Original Loan Agreement with the Lenders, amending and restating the term loan repayment schedules of the Original Loan Agreement. The amended and restated term loan repayment schedule provided for interest only payments through January 2016, followed by consecutive equal monthly payments of principal and interest in arrears starting in February 2016 and continuing through the previously established maturity date of January 1, 2018. Consistent with the original loan, the amended Original Loan Agreement provided for a 7.55% interest rate on the term loan and a final payment equal to 8.5% of the original principal amount, or $4.25 million, which was due when the term loan became due or upon the prepayment of the facility.
In June 2016, we entered into a Loan and Security Agreement (the “Loan Agreement”) with the Lenders, providing a senior secured loan facility of up to an aggregate principal amount of $70.0 million, comprising a $55.0 million draw in June 2016 and an additional $15.0 million tranche, which we had the option to draw during the second quarter of 2017 and did not exercise. The initial proceeds carry an interest rate of 8.25% and were partially used to pay the outstanding principal and final payment of $4.25 million owed on the Original Loan Agreement with the Lenders. The remaining proceeds are being used for working capital and general business requirements. The repayment schedule provides for interest only payments for the first 18 months, followed by consecutive equal monthly payments of principal and interest in arrears through the maturity date of January 1, 2021. The Loan Agreement provides for a final payment equal to 5.50% of the initial $55.0 million principal amount. The final payment is due when the Loan Agreement becomes due or upon the prepayment of the facility. We have the option to prepay the outstanding balance of the Loan Agreement in full, subject to a prepayment fee of 2% in the first year and 1% in the second year of the Loan Agreement.
In connection with the Loan Agreement, the debt offering costs have been recorded as a debt discount in our condensed consolidated balance sheets which, together with the final payment and fixed interest rate payments, are being amortized and recorded as interest expense throughout the life of the loan using the effective interest rate method.
The Loan Agreement is secured by substantially all of the assets of the Company and our subsidiary, Halozyme, Inc., except that the collateral does not include any equity interests in Halozyme, Inc., any of our intellectual property (including all licensing, collaboration and similar agreements relating thereto), and certain other excluded assets. The Loan Agreement contains customary representations, warranties and covenants by us, which covenants limit our ability to convey, sell, lease, transfer, assign or otherwise dispose of certain of our assets; engage in any business other than the businesses currently engaged in by us or reasonably related thereto; liquidate or dissolve; make certain management changes; undergo certain change of control events; create, incur, assume, or be liable with respect to certain indebtedness; grant certain liens; pay dividends and make certain other restricted payments; make certain investments; make payments on any subordinated debt; enter into transactions with any of our affiliates outside of the ordinary course of business or permit our subsidiaries to do the same; and make any voluntary prepayment of or modify certain terms of the Royalty-backed Loan. In addition, subject to certain exceptions, we are required to maintain with SVB our primary deposit accounts, securities accounts and commodities, and to do the same for our subsidiary, Halozyme, Inc.
The Loan Agreement also contains customary indemnification obligations and customary events of default, including, among other things, our failure to fulfill certain of our obligations under the Loan Agreement and the occurrence of a material adverse change which is defined as a material adverse change in our business, operations, or condition (financial or otherwise), a material impairment of the prospect of repayment of any portion of the loan, a material impairment in the perfection or priority of the Lender’s lien in the collateral or in the value of such collateral or the occurrence of an event of default under the Royalty-backed Loan. In the event of default by us under the Loan Agreement, the Lenders would be entitled to exercise their remedies thereunder, including the right to accelerate the debt, upon which we may be required to repay all amounts then outstanding under the Loan Agreement, which could harm our financial condition.
 As of December 31, 2017, we were in compliance with all covenants under the Loan Agreement and there was no material adverse change in our business, operations or financial condition.
Interest expense, including amortization of the debt discount, related to the Loan Agreement totaled $5.5 million, $20.0 million and $5.2 million for the years ended December 31, 2017, 2016 and 2015, respectively. Accrued interest, which is included in accrued expenses, was $0.4 million and $1.1 million as of December 31, 2017 and 2016, respectively. The outstanding term loan balance was $55.9 million as of December 31, 2017, inclusive of $1.3 million of accretion of the final payment and net of unamortized debt discount related to offering costs of $0.4 million.
Future maturities and interest payments of long-term debt as of December 31, 2017, are as follows (in thousands):
2018
 
$
94,125

2019
 
105,758

2020
 
27,311

2021
 
4,755

2022
 
—

Total minimum payments
 
231,949

Less amount representing interest
 
(26,792
)
Gross balance of long-term debt
 
205,157

Less unamortized debt discount
 
(2,806
)
Present value of long-term debt
 
202,351

Less current portion of long-term debt
 
(77,211
)
Long-term debt, less current portion and unamortized debt discount
 
$
125,140

Share-based Compensation (Notes)
Disclosure of Compensation Related Costs, Share-based Payments [Text Block]
Share-based Compensation
We currently grant stock options, restricted stock awards and restricted stock units under the Amended and Restated 2011 Stock Plan (“2011 Stock Plan”), which was approved by the stockholders on May 6, 2016 and provides for the grant of up to 44.2 million shares of common stock to selected employees, consultants and non-employee members of our Board of Directors as stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards and performance awards. The 2011 Stock Plan was approved by the stockholders. Awards are subject to terms and conditions established by the Compensation Committee of our Board of Directors. During the year ended December 31, 2017, we granted share-based awards under the 2011 Stock Plan. At December 31, 2017, 13,023,641 shares were subject to outstanding awards and 6,552,249 shares were available for future grants of share-based awards.
Total share-based compensation expense related to share-based awards was comprised of the following (in thousands):
 
 
Year Ended December 31,
 
 
2017
 
2016
 
2015
Research and development
 
$
13,080

 
$
11,470

 
$
9,795

Selling, general and administrative
 
17,590

 
14,115

 
11,043

Share-based compensation expense
 
$
30,670

 
$
25,585

 
$
20,838


Share-based compensation expense by type of share-based award (in thousands):
 
 
Year Ended December 31,
 
 
2017
 
2016
 
2015
Stock options
 
$
19,583

 
$
16,544

 
$
11,145

RSAs, RSUs and PRSUs
 
11,087

 
9,041

 
9,693

 
 
$
30,670

 
$
25,585

 
$
20,838


Total unrecognized estimated compensation cost by type of award and the weighted-average remaining requisite service period over which such expense is expected to be recognized (in thousands, unless otherwise noted):
 
 
December 31, 2017
 
 
Unrecognized
Expense
 
Remaining
Weighted-Average
Recognition Period
(years)
Stock options
 
$
36,914

 
2.4
RSAs
 
$
4,610

 
1.6
RSUs
 
$
15,965

 
2.6

Cash flows resulting from tax deductions in excess of the cumulative compensation cost recognized for options exercised (excess tax benefits) are classified as cash inflows provided by financing activities and cash outflows used in operating activities.
Stock Options. Options granted under the Plans must have an exercise price equal to at least 100% of the fair market value of our common stock on the date of grant. The options generally have a maximum contractual term of ten years and vest at the rate of one-fourth of the shares on the first anniversary of the date of grant and 1/48 of the shares monthly thereafter. Certain option awards provide for accelerated vesting if there is a change in control (as defined in the Plans).
A summary of our stock option award activity as of and for the years ended December 31, 2017, 2016 and 2015 is as follows: 
 
 
Shares
Underlying
Stock Options
 
Weighted
Average Exercise
Price per Share
 
Weighted
Average
Remaining
Contractual
Term (years)
 
Aggregate
Intrinsic
Value
Outstanding at January 1, 2015
 
6,353,892

 
$9.18
 
 
 
 
Granted
 
3,973,604

 
$16.26
 
 
 
 
Exercised
 
(1,926,368
)
 
$7.49
 
 
 
 
Canceled/forfeited
 
(407,936
)
 
$10.64
 
 
 
 
Outstanding at December 31, 2015
 
7,993,192

 
$13.03
 
 
 
 
Granted
 
4,466,306

 
$9.03
 
 
 
 
Exercised
 
(413,248
)
 
$6.88
 
 
 
 
Canceled/forfeited
 
(955,054
)
 
$12.42
 
 
 
 
Outstanding at December 31, 2016
 
11,091,196

 
$11.70
 
 
 
 
Granted
 
2,717,614

 
$12.60
 
 
 
 
Exercised
 
(1,514,826
)
 
$9.24
 
 
 
 
Canceled/forfeited
 
(1,185,518
)
 
$11.89
 
 
 
 
Outstanding at December 31, 2017
 
11,108,466

 
$12.24
 
7.0
 

$90.8
 million
Vested and expected to vest at December 31, 2017
 
11,108,466

 
$12.24
 
7.0
 

$90.8
 million
Exercisable at December 31, 2017
 
5,493,802

 
$12.31
 
6.1
 

$44.7
 million

The weighted average grant date fair values of options granted during the years ended December 31, 2017, 2016 and 2015 were $7.86 per share, $5.36 per share and $9.60 per share, respectively. The total intrinsic value of options exercised during the years ended December 31, 2017, 2016 and 2015 was approximately $10.0 million, $1.4 million and $16.2 million, respectively. Cash received from stock option exercises for the years ended December 31, 2017, 2016 and 2015 was approximately $14.0 million, $2.8 million and $14.4 million, respectively.
The exercise price of stock options granted is equal to the closing price of the common stock on the date of grant. The fair value of each option award is estimated on the date of grant using the Black-Scholes-Merton option pricing model (“Black-Scholes model”). Expected volatility is based on historical volatility of our common stock. The expected term of options granted is based on analyses of historical employee termination rates and option exercises. The risk-free interest rate is based on the U.S. Treasury yield for a period consistent with the expected term of the option in effect at the time of the grant. The dividend yield assumption is based on the expectation of no future dividend payments. The assumptions used in the Black-Scholes model were as follows:
 
 
Year Ended December 31,
 
 
2017
 
2016
 
2015
Expected volatility
 
69.8-71.7%
 
67.5-71.9%
 
66.2-67.4%
Average expected term (in years)
 
5.6
 
5.4
 
5.6
Risk-free interest rate
 
1.73-2.13%
 
1.00-1.90%
 
1.34-1.92%
Expected dividend yield
 
—
 
—
 
—

Restricted Stock Awards. RSAs are grants that entitle the holder to acquire shares of our common stock at zero cost. The shares covered by a RSA cannot be sold, pledged, or otherwise disposed of until the award vests and any unvested shares may be reacquired by us for the original purchase price following the awardee’s termination of service. The RSAs will generally vest at the rate of one-fourth of the shares on each anniversary of the date of grant. Annual grants of RSAs to the Board of Directors typically vest in approximately one year.
The following table summarizes our RSA activity during the years ended December 31, 2017, 2016 and 2015:
 
 
Number of
Shares
 
Weighted
Average
Grant Date
Fair Value
Unvested at January 1, 2015
 
1,158,451

 
$10.26
Granted
 
515,695

 
$15.00
Vested
 
(721,990
)
 
$10.11
Forfeited
 
(140,676
)
 
$11.84
Unvested at December 31, 2015
 
811,480

 
$13.13
Granted
 
968,652

 
$8.41
Vested
 
(296,831
)
 
$12.76
Forfeited
 
(180,198
)
 
$10.33
Unvested at December 31, 2016
 
1,303,103

 
$10.09
Granted
 
98,945

 
$14.15
Vested
 
(514,613
)
 
$10.23
Forfeited
 
(108,485
)
 
$9.62
Unvested at December 31, 2017
 
778,950

 
$10.59

The estimated fair value of the RSAs was based on the closing market value of our common stock on the date of grant. The total grant date fair value of RSAs vested during the years ended December 31, 2017, 2016 and 2015 was approximately $5.3 million, $3.8 million and $7.3 million, respectively. The fair value of RSAs vested during the years ended December 31, 2017, 2016 and 2015, was approximately $6.6 million, $2.5 million and $13.9 million, respectively.
Restricted Stock Units. A RSU is a promise by us to issue a share of our common stock upon vesting of the unit. The RSUs will generally vest at the rate of one-fourth of the shares on each anniversary of the date of grant.
The following table summarizes our RSU activity during the years ended December 31, 2017, 2016 and 2015:
 
 
Number of
Shares
 
Weighted
Average
Grant Date
Fair Value
 
Weighted
Average
Remaining
Contractual
Term (yrs)
 
Aggregate
Intrinsic
Value
Unvested at January 1, 2015
 
462,322

 
$11.12
 
 
 
 
Granted
 
422,492

 
$14.75
 
 
 
 
Vested
 
(134,088
)
 
$10.93
 
 
 
 
Forfeited
 
(84,512
)
 
$10.86
 
 
 
 
Outstanding at December 31, 2015
 
666,214

 
$13.49
 
 
 
 
Granted
 
796,582

 
$8.17
 
 
 
 
Vested
 
(218,279
)
 
$12.74
 
 
 
 
Forfeited
 
(77,948
)
 
$10.99
 
 
 
 
Outstanding at December 31, 2016
 
1,166,569

 
$10.16
 
 
 
 
Granted
 
1,378,273

 
$12.13
 
 
 
 
Vested
 
(378,406
)
 
$10.48
 
 
 
 
Forfeited
 
(251,261
)
 
$11.11
 
 
 
 
Outstanding at December 31, 2017
 
1,915,175

 
$11.39
 
1.4
 

$38.8
 million

The estimated fair value of the RSUs was based on the closing market value of our common stock on the date of grant. The total grant date fair value of RSUs vested during the years ended December 31, 2017, 2016 and 2015 was approximately $4.0 million, $2.8 million and $1.5 million, respectively. The fair value of RSUs vested during the years ended December 31, 2017, 2016 and 2015 was approximately $4.7 million, $2.1 million and $1.8 million, respectively.
Performance Restricted Stock Units. A PRSU is a promise by us to issue a share of our common stock upon achievement of a specific performance condition.
The following table summarizes our PRSU activity during the years ended December 31, 2017, 2016 and 2015:
 
 
Number of
Shares
 
Weighted
Average
Grant Date
Fair Value
Outstanding at January 1, 2015
 
431,238

 

$8.91

Granted
 
118,209

 

$11.19

Vested
 
(83,380
)
 

$9.48

Forfeited
 
(156,360
)
 

$9.21

Outstanding at December 31, 2015
 
309,707

 

$9.48

Granted
 
—

 
—

Vested
 
(30,037
)
 

$9.49

Forfeited
 
(79,415
)
 

$9.44

Outstanding at December 31, 2016
 
200,255

 

$9.49

Granted
 
—

 
—

Vested
 
—

 
—

Forfeited
 
(200,255
)
 

$9.49

Outstanding at December 31, 2017
 
—

 
—


The estimated fair value of the PRSUs was based on the closing market value of our common stock on the date of grant. The total grant date fair value and intrinsic value of PRSUs vested during the years ended December 31, 2017, 2016 and 2015 was approximately zero, $0.3 million and $0.8 million, respectively.
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit)
Stockholders’ Equity (Deficit)
In May 2017, we completed an underwritten public offering pursuant to which we sold 11.5 million shares of common stock, including 1.5 million shares sold pursuant to the full exercise of an option to purchase additional shares granted to the underwriters. All of the shares were offered at a public offering price of $12.50 per share, generating $134.9 million in net proceeds, after deducting underwriting discounts and commissions and other offering expenses. We intend to use the net proceeds from this offering to fund continued development of our PEGPH20 oncology program and for other general corporate purposes.
During the years ended December 31, 2017, 2016 and 2015, we issued an aggregate of 1,514,826, 413,248 and 1,926,368 shares of common stock, respectively, in connection with the exercises of stock options, for net proceeds of approximately $14.0 million, $2.8 million and $14.4 million, respectively. For the years ended December 31, 2017, 2016 and 2015, we issued 281,398, 134,944 and 82,069 shares of common stock, respectively, upon vesting of certain RSUs for which the RSU holders surrendered 97,008, 83,335 and 52,019 RSUs, respectively, to pay for minimum withholding taxes totaling approximately $1.9 million, $0.8 million and $0.7 million, respectively. In addition, we canceled 9,540 shares of common stock, net of issuances and issued 780,066 and 375,019 shares of common stock, net of cancellations in connection with grants of RSAs during the years ended December 31, 2017, 2016 and 2015, respectively.
Commitments and Contingencies
Commitments and Contingencies
Commitments and Contingencies
Operating Leases
Our administrative offices and research facilities are located in San Diego, California. We lease an aggregate of approximately 76,000 square feet of office and research space in four buildings. The leases commenced in June 2011 and November 2013 and continue through January 2023. The leases are subject to approximately 3.0% annual increases throughout the terms of the leases. We also pay a pro rata share of operating costs, insurance costs, utilities and real property taxes. We received incentives under the leases, including tenant improvement allowances and reduced or free rent, for which the unamortized deferred rent balances associated with these incentives was $0.3 million and $0.4 million as of December 31, 2017 and 2016, respectively.
In November 2015, we opened a satellite office in South San Francisco, California. We lease approximately 10,000 square feet of office space. The lease commenced in November 2015 and continues through January 2021. The lease is subject to approximately 3.0% annual increases throughout the term of the lease. We also pay a pro rata share of operating costs, insurance costs, utilities and real property taxes. We received incentives under the lease, including tenant improvement allowances and reduced or free rent, for which the unamortized deferred rent balances associated with these incentives was $0.3 million and $0.4 million as of December 31, 2017 and 2016, respectively.
Additionally, we lease certain office equipment under operating leases. Total rent expense was approximately $2.3 million, $2.2 million and $1.9 million for the years ended December 31, 2017, 2016 and 2015, respectively.
Approximate annual future minimum operating lease payments as of December 31, 2017 are as follows (in thousands): 
Year:
 
Operating
Leases
2018
 
$
2,415

2019
 
2,785

2020
 
2,824

2021
 
2,470

2022
 
2,506

Total minimum lease payments
 
$
13,000


Other Commitments
In March 2010, we entered into a second Commercial Supply Agreement with Avid (the “Avid Commercial Supply Agreement”). Under the terms of the Avid Commercial Supply Agreement, we are committed to certain minimum annual purchases of bulk rHuPH20 equal to three quarters of forecasted supply. In addition, Avid has the right to manufacture and supply a certain percentage of bulk rHuPH20 that will be used in the collaboration products. At December 31, 2017, we had a $7.2 million minimum purchase obligation in connection with this agreement.
In June 2011, we entered into a services agreement with Patheon for the technology transfer and manufacture of Hylenex recombinant. At December 31, 2017, we had a $0.3 million minimum purchase obligation in connection with this agreement. 
Contingencies
We have entered into an in-licensing agreement with a research organization, which is cancelable at our option with 90 days written notice. Under the terms of this agreement, we have received a license to the know-how and technology claimed, in certain patents or patent applications. We are required to pay fees, milestones and/or royalties on future sales of products employing the technology or falling under claims of a patent, and some of the agreements require minimum royalty payments. We continually reassess the value of the license agreement. If the in-licensed and research candidate is successfully developed, we may be required to pay milestone payments of approximately $8.0 million over the life of this agreement in addition to royalties on sales of the affected products. Due to the uncertainties of the development process, the timing and probability of the remaining milestone and royalty payments cannot be accurately estimated.
Legal Contingencies
From time to time, we may be involved in disputes, including litigation, relating to claims arising out of operations in the normal course of our business. Any of these claims could subject us to costly legal expenses and, while we generally believe that we have adequate insurance to cover many different types of liabilities, our insurance carriers may deny coverage or our policy limits may be inadequate to fully satisfy any damage awards or settlements. If this were to happen, the payment of any such awards could have a material adverse effect on our consolidated results of operations and financial position. Additionally, any such claims, whether or not successful, could damage our reputation and business. We currently are not a party to any legal proceedings, the adverse outcome of which, in management’s opinion, individually or in the aggregate, would have a material adverse effect on our consolidated results of operations or financial position.
Income Taxes (Notes)
Income Tax Disclosure [Text Block]
Total income (loss) before income taxes summarized by region were as follows (in thousands):
 
 
Year Ended December 31,
 
 
2017
 
2016
 
2015
United States
 
$
160,938

 
$
6,384

 
$
11,724

Foreign
 
(99,328
)
 
(108,245
)
 
(43,955
)
Net income (loss) before income taxes
 
$
61,610

 
$
(101,861
)
 
$
(32,231
)

Significant components of our net deferred tax assets/(liabilities) were as follows (in thousands).
 
 
December 31,
 
 
2017
 
2016
Deferred tax assets:
 
 
 
 
Net operating loss carryforwards
 
$
32,630

 
$
103,296

Deferred revenue
 
8,815

 
15,354

Research and development and orphan drug credits
 
75,224

 
73,701

Share-based compensation
 
7,423

 
8,844

Alternative minimum tax credit
 
5,532

 
1,494

Other, net
 
2,270

 
1,021

 
 
131,894

 
203,710

Valuation allowance for deferred tax assets
 
(126,189
)
 
(203,370
)
Deferred tax assets, net of valuation
 
5,705

 
340

Deferred tax liabilities:
 
 
 
 
Depreciation
 
(173
)
 
(340
)
Total deferred tax liabilities
 
(173
)
 
(340
)
Net deferred tax asset (liability)
 
$
5,532

 
$
—


A valuation allowance of $126.2 million and $203.4 million has been established to offset the net deferred tax assets as of December 31, 2017 and 2016, respectively, as realization of such assets is uncertain. Under the Act, the AMT credit carryovers can be used to offset regular tax liability for taxable years beginning after 2017. If not utilized before 2022, any remaining AMT credit carryover will be fully refundable. Accordingly, the recognized deferred tax asset, on a provisional basis, as of December 31, 2017 is the AMT credit carryover that will either be utilized or refunded.
Income tax expense was comprised of the following components (in thousands):
 
 
Year Ended December 31,
 
 
2017
 
2016
 
2015
Current - federal
 
$
4,051

 
$
1,145

 
$
—

Current - state
 
120

 
17

 
—

Deferred - federal
 
(5,532
)
 
—

 
—

Deferred - state
 
—

 
—

 
—

 
 
$
(1,361
)
 
$
1,162

 
$
—


The provision for income taxes on earnings subject to income taxes differs from the statutory federal income tax rate due to the following (in thousands):
 
 
Year Ended December 31,
 
 
2017
 
2016
 
2015
Federal income tax expense (benefit) at 34%
 
$
20,947

 
$
(34,633
)
 
$
(10,959
)
State income tax benefit, net of federal income tax impact
 
930

 
(653
)
 
5,524

(Decrease) increase in valuation allowance
 
(77,181
)
 
11,252

 
4,045

Enactment of the Tax Cuts and Jobs Act
 
17,132

 
—

 
—

Foreign income subject to tax at other than federal statutory rate
 
33,674

 
36,803

 
14,945

Shared-based compensation
 
525

 
3,735

 
(4,990
)
Non-deductible expenses and other
 
5,779

 
698

 
6,457

Research and development credits, net
 
4,162

 
(1,084
)
 
(3,861
)
Orphan drug credits, net of federal add back
 
(7,329
)
 
(14,956
)
 
(11,161
)
 
 
$
(1,361
)
 
$
1,162

 
$
—


At December 31, 2017, our unrecognized tax benefit and uncertain tax positions were $14.4 million. None of this amount would affect the effective tax rate and $14.4 million would affect the effective tax rate in the event the valuation allowance was removed. Of the unrecognized tax benefits, we do not expect any significant changes to occur in the next 12 months. Interest and/or penalties related to uncertain income tax positions are recognized by us as a component of income tax expense. For the years ended December 31, 2017, 2016 and 2015, we recognized no interest or penalties.
The following table summarizes the activity related to our unrecognized tax benefits (in thousands):
 
 
Year Ended December 31,
 
 
2017
 
2016
 
2015
Gross unrecognized tax benefits at beginning of period
 
$
12,799

 
$
4,898

 
$
—

Increases in tax positions for prior years
 
—

 
5,615

 
—

Decreases in tax positions for prior years
 
(2,518
)
 
(4,898
)
 
—

Increases in tax positions for current year
 
4,147

 
7,184

 
4,898

Gross unrecognized tax benefits at end of period
 
$
14,428

 
$
12,799

 
$
4,898


At December 31, 2017, we had federal, California and other state tax net operating loss carryforwards of approximately $88.5 million, $243.1 million and $13.9 million, respectively.
The following table shows key expiration dates of the federal and California net operating loss carryforwards (in thousands):
 
 
 
 
Expires in:
 
 
Net Operating Loss
 
2018
 
2021 and beyond
 
2028 and beyond
Federal
 
$
88,516

 
—

 
$
88,516

 
—

California
 
$
243,080

 
—

 
—

 
$
243,080


At December 31, 2017, we had federal and California research and development tax credit carryforwards of approximately $19.1 million and $11.7 million, respectively. The federal research and development tax credits will begin to expire in 2024 unless previously utilized. The California research and development tax credits will carryforward indefinitely until utilized. Additionally, we had Orphan Drug Credit carryforwards of $57.3 million which will begin to expire in 2035.
Pursuant to Internal Revenue Code Section 382, the annual use of the net operating loss carryforwards and research and development tax credits could be limited by any greater than 50% ownership change during any three year testing period. As a result of any such ownership change, portions of our net operating loss carryforwards and research and development tax credits are subject to annual limitations. A Section 382 analysis regarding the limitation of the net operating losses and research and development credits was completed as of November 1, 2017. Based upon the analysis, we do not believe an ownership change occurred during 2017. Based upon previous analysis it was determined that ownership changes occurred in prior years; however, the annual limitations on net operating loss and research and development tax credit carryforwards will not have a material impact on the future utilization of such carryforwards.
We do not provide for U.S. income taxes on the undistributed earnings of our foreign subsidiaries as it is our intention to utilize those earnings in the foreign operations for an indefinite period of time. At December 31, 2017 and 2016, there were no undistributed earnings in foreign subsidiaries.
We are subject to taxation in the U.S. and in various state and foreign jurisdictions. Our tax years for 1998 and forward are subject to examination by the U.S. and California tax authorities due to the carryforward of unutilized net operating losses and research and development credits.
A new Swiss subsidiary, Halozyme Switzerland GmbH, was formed during the fourth quarter of 2016 and obtained a tax ruling from Canton of Basel Stadt for its operations in Switzerland. The tax ruling is dated December 21, 2016, and will continue for a period of ten years, not to extend beyond December 31, 2026. The combined income tax burden at the federal, cantonal and communal level will not exceed 10% during the period covered by the ruling. As a result of foreign losses and a full valuation allowance, no net tax benefit was derived for the year ended December 31, 2017 as a result of the tax ruling.
Employee Savings Plan (Notes)
Compensation and Employee Benefit Plans [Text Block]
Employee Savings Plan
We have an employee savings plan pursuant to Section 401(k) of the Internal Revenue Code. All employees are eligible to participate, provided they meet the requirements of the plan. We are not required to make matching contributions under the plan. However, we voluntarily contributed to the plan approximately $1.2 million, $1.0 million and $0.7 million for the years ended December 31, 2017, 2016 and 2015, respectively.
Summary of Unaudited Quarterly Financial Information (Notes)
Quarterly Financial Information [Text Block]
Summary of Unaudited Quarterly Financial Information
The following is a summary of our unaudited quarterly results for the years ended December 31, 2017 and 2016 (in thousands):
 
 
Quarter Ended
2017 (Unaudited):
 
March 31,
 
June 30,
 
September 30,
 
December 31,
Total revenues (1) (2)
 
$
29,568

 
$
33,750

 
$
63,731

 
$
189,564

Gross profit on product sales
 
$
3,890

 
$
4,992

 
$
5,257

 
$
5,105

Total operating expenses
 
$
57,094

 
$
59,228

 
$
55,654

 
$
63,635

Net income (loss)
 
$
(32,897
)
 
$
(30,763
)
 
$
2,749

 
$
123,882

Net income (loss) per share:
 
 
 
 
 
 
 
 
Basic
 
$
(0.26
)
 
$
(0.23
)
 
$
0.02

 
$
0.87

Diluted
 
$
(0.26
)
 
$
(0.23
)
 
$
0.02

 
$
0.85

Shares used in computing net income (loss) per share:
 
 
 
 
 
 
 
 
Basic
 
128,615

 
134,013

 
141,190

 
141,718

Diluted
 
128,615

 
134,013

 
143,236

 
145,633

 
 
Quarter Ended
2016 (Unaudited):
 
March 31,
 
June 30,
 
September 30,
 
December 31,
Total revenues
 
$
42,499

 
$
33,336

 
$
31,853

 
$
39,003

Gross profit on product sales
 
$
5,178

 
$
5,391

 
$
4,197

 
$
5,420

Total operating expenses
 
$
58,668

 
$
55,059

 
$
54,596

 
$
61,578

Net loss
 
$
(19,816
)
 
$
(26,875
)
 
$
(28,946
)
 
$
(27,386
)
Net loss per share, basic and diluted
 
$
(0.16
)
 
$
(0.21
)
 
$
(0.23
)
 
$
(0.21
)
Shares used in computing basic and diluted net loss per share
 
127,615

 
127,958

 
128,154

 
128,185

_______________
(1)
Revenues for the quarter ended December 31, 2017 included $101.4 million, $40.0 million and $15.0 million in revenue under collaborative arrangements from BMS, Alexion and Janssen, respectively.
(2)
Revenues for the quarter ended September 30, 2017 included $30.0 million in revenue under collaborative arrangements from the 2017 Roche Collaboration.
Schedule II Valuation and Qualifying Accounts (Notes)
Schedule of Valuation and Qualifying Accounts Disclosure [Text Block]
Valuation and Qualifying Accounts
(in thousands)
 
 
Balance at Beginning of Period
 
Additions
 
Deductions
 
Balance at End of Period
For the year ended December 31, 2017
 
 
 
 
 
 
 
 
Accounts receivable allowances (1)
 
$
559

 
$
4,645

 
$
(4,645
)
 
$
559

For the year ended December 31, 2016
 
 
 
 
 
 
 
 
Accounts receivable allowances (1)
 
$
967

 
$
4,795

 
$
(5,203
)
 
$
559

For the year ended December 31, 2015
 
 
 
 
 
 
 
 
Accounts receivable allowances (1)
 
$
611

 
$
4,150

 
$
(3,794
)
 
$
967

_______________
(1)
Allowances are for chargebacks, prompt payment discounts and distribution fees related to Hylenex recombinant product sales.
Summary of Significant Accounting Policies (Policies)
Basis of Presentation 
Basis of Presentation
The consolidated financial statements include the accounts of Halozyme Therapeutics, Inc. and our wholly owned subsidiary, Halozyme, Inc., and Halozyme, Inc.’s wholly owned subsidiaries, Halozyme Holdings Ltd., Halozyme Royalty LLC, Halozyme Switzerland GmbH and Halozyme Switzerland Holdings GmbH. All intercompany accounts and transactions have been eliminated.
Use of Estimates, Policy [Policy Text Block] 
Use of Estimates
The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) requires management to make estimates and assumptions that affect the amounts reported in our consolidated financial statements and accompanying notes. On an ongoing basis, we evaluate our estimates and judgments, which are based on historical and anticipated results and trends and on various other assumptions that management believes to be reasonable under the circumstances. By their nature, estimates are subject to an inherent degree of uncertainty and, as such, actual results may differ from management’s estimates.
Cash Equivalents 
Cash Equivalents and Marketable Securities
Cash equivalents consist of highly liquid investments, readily convertible to cash, that mature within ninety days or less from the date of purchase. As of December 31, 2017, our cash equivalents consisted of money market funds and commercial paper.
Marketable Securities 
Marketable securities are investments with original maturities of more than ninety days from the date of purchase that are specifically identified to fund current operations. Marketable securities are considered available-for-sale. These investments are classified as current assets, even though the stated maturity date may be one year or more beyond the current balance sheet date which reflects management’s intention to use the proceeds from the sale of these investments to fund our operations, as necessary. Such available-for-sale investments are carried at fair value with unrealized gains and losses recorded in other comprehensive gain (loss) and included as a separate component of stockholders’ equity (deficit). The cost of marketable securities is adjusted for amortization of premiums or accretion of discounts to maturity, and such amortization or accretion is included in investment and other income, net in the condensed consolidated statements of operations. We use the specific identification method for calculating realized gains and losses on marketable securities sold. Realized gains and losses and declines in value judged to be other-than-temporary on marketable securities, if any, are included in investment and other income, net in the consolidated statements of operations.
Restricted Cash 
Restricted Cash
Under the terms of the leases of our facilities, we are required to maintain letters of credit as security deposits during the terms of such leases.
Fair Value of Financial Instruments 
Fair Value of Financial Instruments
The authoritative guidance for fair value measurements establishes a three tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.
Our financial instruments include cash equivalents, available-for-sale marketable securities, accounts receivable, prepaid expenses and other assets, accounts payable, accrued expenses and long-term debt. Fair value estimates of these instruments are made at a specific point in time, based on relevant market information. These estimates may be subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. The carrying amount of cash equivalents, accounts receivable, prepaid expenses and other assets, accounts payable and accrued expenses are generally considered to be representative of their respective fair values because of the short-term nature of those instruments. Based on Level 3 inputs and the borrowing rates currently available for loans with similar terms, we believe the fair value of long-term debt approximates its carrying value.
Available-for-sale marketable securities consist of corporate debt securities, U.S. Treasury securities and commercial paper, and are measured at fair value using Level 1 and Level 2 inputs. Level 2 financial instruments are valued using market prices on less active markets and proprietary pricing valuation models with observable inputs, including interest rates, yield curves, maturity dates, issue dates, settlement dates, reported trades, broker-dealer quotes, issue spreads, benchmark securities or other market related data. We obtain the fair value of Level 2 investments from our investment manager, who obtains these fair values from a third-party pricing source. We validate the fair values of Level 2 financial instruments provided by our investment manager by comparing these fair values to a third-party pricing source.
Concentration Risk, Credit Risk, Policy [Policy Text Block] 
Concentrations of Credit Risk, Sources of Supply and Significant Customers
We are subject to credit risk from our portfolio of cash equivalents and marketable securities. These investments were made in accordance with our investment policy which specifies the categories, allocations, and ratings of securities we may consider for investment. The primary objective of our investment activities is to preserve principal while at the same time maximizing the income we receive without significantly increasing risk. We maintain our cash and cash equivalent balances with one major commercial bank and marketable securities with another financial institution. Deposits held with the financial institutions exceed the amount of insurance provided on such deposits. We are exposed to credit risk in the event of a default by the financial institutions holding our cash, cash equivalents and marketable securities to the extent recorded on the consolidated balance sheets.
We are also subject to credit risk from our accounts receivable related to our product sales and revenues under our license and collaborative agreements. We have license and collaborative agreements with pharmaceutical companies under which we receive payments for license fees, milestone payments for specific achievements designated in the collaborative agreements, reimbursements of research and development services and supply of bulk formulation of rHuPH20. In addition, we sell Hylenex® recombinant in the United States to a limited number of established wholesale distributors in the pharmaceutical industry. Credit is extended based on an evaluation of the customer’s financial condition, and collateral is not required. Management monitors our exposure to accounts receivable by periodically evaluating the collectibility of the accounts receivable based on a variety of factors including the length of time the receivables are past due, the financial health of the customer and historical experience.
Trade and Other Accounts Receivable, Policy [Policy Text Block] 
Accounts Receivable, Net
Accounts receivable is recorded at the invoiced amount and is non-interest bearing. Accounts receivable is recorded net of allowances for doubtful accounts, cash discounts for prompt payment, distribution fees and chargebacks.
Inventory, Policy [Policy Text Block] 
Inventories
Inventories are stated at lower of cost or net realizable value. Cost is determined on a first-in, first-out basis. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Inventories are reviewed periodically for potential excess, dated or obsolete status. We evaluate the carrying value of inventories on a regular basis, taking into account such factors as historical and anticipated future sales compared to quantities on hand, the price we expect to obtain for products in their respective markets compared with historical cost and the remaining shelf life of goods on hand.
Prior to receiving marketing approval from the U.S. Food and Drug Administration (“FDA”) or comparable regulatory agencies in foreign countries, costs related to purchases of bulk rHuPH20 and raw materials and the manufacturing of the product candidates are recorded as research and development expense. All direct manufacturing costs incurred after receiving marketing approval are capitalized as inventory. Inventories used in clinical trials are expensed at the time the inventories are packaged for the clinical trials.
Property and Equipment, Policy [Policy Text Block] 
Property and Equipment, Net
Property and equipment are recorded at cost, less accumulated depreciation and amortization. Equipment is depreciated using the straight-line method over its estimated useful life of three years and leasehold improvements are amortized using the straight-line method over the estimated useful life of the asset or the lease term, whichever is shorter.
Impairment of Long-Lived Assets, Policy [Policy Text Block] 
Impairment of Long-Lived Assets
We account for long-lived assets in accordance with authoritative guidance for impairment or disposal of long-lived assets. Long-lived assets are reviewed for events or changes in circumstances, which indicate that their carrying value may not be recoverable.
Deferred Charges, Policy [Policy Text Block] 
Deferred Rent
Rent expense is recorded on a straight-line basis over the initial term of the lease. The difference between rent expense accrued and amounts paid under lease agreements is recorded as deferred rent and is included in accrued expenses and other long-term liabilities, as applicable, in the accompanying consolidated balance sheets.
Comprehensive Income (Loss), Policy [Policy Text Block] 
Comprehensive Income (Loss)
Comprehensive income (loss) is defined as the change in equity during the period from transactions and other events and circumstances from non-owner sources.
Revenue Recognition, Policy [Policy Text Block] 
Revenue Recognition
We generate revenues from product sales and payments received under collaborative agreements. Collaborative agreement payments may include nonrefundable fees at the inception of the agreements, license fees, milestone and event-based payments for specific achievements designated in the collaborative agreements, reimbursements of research and development services and supply of bulk rHuPH20, and/or royalties on sales of products resulting from collaborative arrangements.
We recognize revenues in accordance with the authoritative guidance for revenue recognition. We recognize revenue when all of the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services have been rendered; (3) the seller’s price to the buyer is fixed or determinable; and (4) collectibility is reasonably assured.
Product Sales, Net
Hylenex Recombinant
We sell Hylenex recombinant in the U.S. to wholesale pharmaceutical distributors, who sell the product to hospitals and other end-user customers. Sales to wholesalers provide for selling prices that are fixed on the date of sale, although we offer discounts to certain group purchasing organizations (“GPOs”), hospitals and government programs. The wholesalers take title to the product, bear the risk of loss of ownership and have economic substance to the inventory. Further, we have no significant obligations for future performance to generate pull-through sales.
We have developed sufficient historical experience and data to reasonably estimate future returns and chargebacks of Hylenex recombinant. As a result, we recognize Hylenex recombinant product sales and related cost of product sales at the time title transfers to the wholesalers.
Upon recognition of revenue from product sales of Hylenex recombinant, we record certain sales reserves and allowances as a reduction to gross revenue. These reserves and allowances include amounts for product returns (based primarily on an analysis of historical return patterns), distribution fees, prompt payment discounts, and GPO fees and other discounts and fees.
We recognize product sales reserves and allowances as a reduction of product sales in the same period the related revenue is recognized. Because of the shelf life of Hylenex recombinant and our lengthy return period, there may be a significant period of time between when the product is shipped and when we issue credits on returned product. If actual product return results differ from our estimates, we will be required to make adjustments to these allowances in the future, which could have an effect on product sales revenue and earnings in the period of adjustments.
Bulk rHuPH20
Subsequent to receiving marketing approval from the FDA or comparable regulatory agencies in foreign countries, sales of bulk rHuPH20 for use in collaboration commercial products are recognized as product sales when the materials have met all the specifications required for the customer’s acceptance and title and risk of loss have transferred to the customer. Following the receipt of European marketing approvals of Roche’s Herceptin SC product in August 2013 and MabThera® SC product in March 2014 and Baxalta’s HYQVIA product in May 2013, revenue from the sales of bulk rHuPH20 for these collaboration products has been recognized as product sales.
Revenues under Collaborative Agreements
We have entered into license and collaboration agreements under which our collaborators obtained worldwide rights for the use of our proprietary rHuPH20 enzyme in the development and commercialization of their biologic compounds identified as targets. These agreements may also contain other elements. Pursuant to the terms of these agreements, collaborators could be required to make various payments to us for each target, including nonrefundable upfront license fees, exclusivity fees, payments based on achievement of specified milestones designated in the collaborative agreements, annual maintenance fees, reimbursements of research and development services, payments for supply of bulk rHuPH20 used by the collaborator and/or royalties on sales of products resulting from collaborative agreements.
In order to account for the multiple-element arrangements, we identify the deliverables included within the collaborative agreement and evaluate which deliverables represent units of accounting. We then determine the appropriate method of revenue recognition for each unit based on the nature and timing of the delivery process. Analyzing the arrangement to identify deliverables requires the use of judgment, and each deliverable may be an obligation to deliver services, a right or license to use an asset, or another performance obligation. The deliverables under our collaborative agreements include (i) the license to our rHuPH20 technology, (ii) at the collaborator’s request, research and development services which are reimbursed at contractually determined rates, and (iii) at the collaborator’s request, supply of bulk rHuPH20 which is reimbursed at our cost plus a margin. A delivered item is considered a separate unit of accounting when the delivered item has value to the collaborator on a standalone basis based on the consideration of the relevant facts and circumstances for each arrangement. We base this determination on the collaborators’ ability to use the delivered items on their own without us supplying undelivered items, which we determine taking into consideration factors such as the research capabilities of the collaborator, the availability of research expertise in this field in the general marketplace, and the ability to procure the supply of bulk rHuPH20 from the marketplace.
Arrangement consideration is allocated at the inception of the agreement to all identified units of accounting based on their relative selling price. The relative selling price for each deliverable is determined using vendor specific objective evidence (“VSOE”) of selling price or third-party evidence of selling price if VSOE does not exist. If neither VSOE nor third-party evidence of selling price exists, we use our best estimate of the selling price for the deliverable. The amount of allocable arrangement consideration is limited to amounts that are not contingent upon the delivery of additional items or meeting other specified performance conditions. The consideration received is allocated among the separate units of accounting and the applicable revenue recognition criteria are applied to each of the separate units. Changes in the allocation of the sales price between delivered and undelivered elements can impact revenue recognition but do not change the total revenue recognized under any agreement.
Nonrefundable upfront license fees are recognized upon delivery of the license if facts and circumstances dictate that the license has standalone value from the undelivered items, which generally include research and development services and the manufacture of bulk rHuPH20, the relative selling price allocation of the license is equal to or exceeds the upfront license fee, persuasive evidence of an arrangement exists, our price to the collaborator is fixed or determinable and collectibility is reasonably assured. Upfront license fees are deferred if facts and circumstances dictate that the license does not have standalone value. The determination of the length of the period over which to defer revenue is subject to judgment and estimation and can have an impact on the amount of revenue recognized in a given period.
When collaborators have rights to elect additional targets, the rights are assessed as to whether they represent deliverables at the inception of the arrangement. In assessing these contingent deliverables, we consider whether the right is a substantive option. We consider a right to be a substantive option if the election of the additional targets is not essential to the functionality of the other elements in the arrangement and if we are truly at risk of the right being exercised. If the right is determined to be a substantive option, we further consider whether the right is priced at a significant and incremental discount that should be accounted for as an element of the arrangement. If a right is determined to be a substantive option and is not priced at a significant and incremental discount, it is not treated as a deliverable in the arrangement and receives no allocation at the inception of the arrangement of the original arrangement consideration. The right is then accounted for when and if it is exercised. When collaborators have a right to return targets, the right is assessed as to whether the target may be returned for a refund of the purchase price, for a credit applied to amounts owed, or in exchange for other dissimilar products. We also assess if we have sufficient history to estimate the likelihood of return. If a right of return is considered to exist and we determine there is not sufficient history to estimate the likelihood of return, the consideration allocated to returnable targets is recorded as deferred revenue on the consolidated balance sheet until the right of return is exercised or expires.
Certain of our collaborative agreements provide for milestone payments upon achievement of development and regulatory events and/or specified sales volumes of commercialized products by the collaborator. We account for milestone payments in accordance with the provisions of ASU No. 2010-17, Revenue Recognition - Milestone Method (“Milestone Method of Accounting”). We recognize consideration that is contingent upon the achievement of a milestone in its entirety as revenue in the period in which the milestone is achieved only if the milestone is substantive in its entirety. A milestone is considered substantive when it meets all of the following criteria:
1.
The consideration is commensurate with either the entity’s performance to achieve the milestone or the enhancement of the value of the delivered item(s) as a result of a specific outcome resulting from the entity’s performance to achieve the milestone;
2.
The consideration relates solely to past performance; and
3.
The consideration is reasonable relative to all of the deliverables and payment terms within the arrangement.
A milestone is defined as an event (i) that can only be achieved based in whole or in part on either the entity’s performance or on the occurrence of a specific outcome resulting from the entity’s performance, (ii) for which there is substantive uncertainty at the date the arrangement is entered into that the event will be achieved, and (iii) that would result in additional payments being due to the vendor.
Reimbursements of research and development services are recognized as revenue during the period in which the services are performed as long as there is persuasive evidence of an arrangement, the fee is fixed or determinable and collection of the related receivable is reasonably assured. Revenue from the manufacture of bulk rHuPH20 is recognized when the materials have met all specifications required for the collaborator’s acceptance and title and risk of loss have transferred to the collaborator. We do not directly control when any collaborator will request research and development services or supply of bulk rHuPH20; therefore, we cannot predict when we will recognize revenues in connection with research and development services and supply of bulk rHuPH20.
Since we receive royalty reports 60 days after quarter end, royalty revenue from sales of collaboration products by our collaborators is recognized in the quarter following the quarter in which the corresponding sales occurred.
The collaborative agreements typically provide the collaborators the right to terminate such agreement in whole or on a product-by-product or target-by-target basis at any time upon 30 to 90 days prior written notice to us. There are no performance, cancellation, termination or refund provisions in any of our collaborative agreements that contain material financial consequences to us.
Cost of Product Sales, Policy [Policy Text Block] 
Cost of Product Sales
Cost of product sales consists primarily of raw materials, third-party manufacturing costs, fill and finish costs, freight costs, internal costs and manufacturing overhead associated with the production of Hylenex recombinant and bulk rHuPH20 for use in approved collaboration products. Cost of product sales also consists of the write-down of excess, dated and obsolete inventories and the write-off of inventories that do not meet certain product specifications, if any.
Research and Development Expenses 
Research and Development Expenses
Research and development expenses include salaries and benefits, facilities and other overhead expenses, external clinical trial expenses, research related manufacturing services, contract services and other outside expenses. Research and development expenses are charged to operating expenses as incurred when these expenditures relate to our research and development efforts and have no alternative future uses. After receiving approval from the FDA or comparable regulatory agencies in foreign countries for a product, costs related to purchases and manufacturing of bulk rHuPH20 for such product are capitalized as inventory. The manufacturing costs of bulk rHuPH20 for the collaboration products, Herceptin SC, MabThera SC (RITUXAN HYCELA™ in the U.S.) and HYQVIA, incurred after the receipt of marketing approvals are capitalized as inventory.
We are obligated to make upfront payments upon execution of certain research and development agreements. Advance payments, including nonrefundable amounts, for goods or services that will be used or rendered for future research and development activities are deferred. Such amounts are recognized as expense as the related goods are delivered or the related services are performed or such time when we do not expect the goods to be delivered or services to be performed.
Milestone payments that we make in connection with in-licensed technology for a particular research and development project that have no alternative future uses (in other research and development projects or otherwise) and therefore no separate economic value are expensed as research and development costs at the time the costs are incurred.
Clinical Trial Expenses 
Clinical Trial Expenses
We make payments in connection with our clinical trials under contracts with contract research organizations that support conducting and managing clinical trials. The financial terms of these agreements are subject to negotiation and vary from contract to contract and may result in uneven payment flows. Generally, these agreements set forth the scope of work to be performed at a fixed fee, unit price or on a time and materials basis. A portion of our obligation to make payments under these contracts depends on factors such as the successful enrollment or treatment of patients or the completion of other clinical trial milestones.
Expenses related to clinical trials are accrued based on our estimates and/or representations from service providers regarding work performed, including actual level of patient enrollment, completion of patient studies and progress of the clinical trials. Other incidental costs related to patient enrollment or treatment are accrued when reasonably certain. If the amounts we are obligated to pay under our clinical trial agreements are modified (for instance, as a result of changes in the clinical trial protocol or scope of work to be performed), we adjust our accruals accordingly on a prospective basis. Revisions to our contractual payment obligations are charged to expense in the period in which the facts that give rise to the revision become reasonably certain.
Share-Based Compensation 
Share-Based Compensation
We record compensation expense associated with stock options, restricted stock awards (“RSAs”), restricted stock units (“RSUs”), and RSUs with performance conditions (“PRSUs”) in accordance with the authoritative guidance for stock-based compensation. The cost of employee services received in exchange for an award of an equity instrument is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense on a straight-line basis over the requisite service period of the award. Share-based compensation expense for an award with a performance condition is recognized when the achievement of such performance condition is determined to be probable. If the outcome of such performance condition is not determined to be probable or is not met, no compensation expense is recognized and any previously recognized compensation expense is reversed. Forfeitures are recognized as a reduction of share-based compensation expense as they occur.
Income Taxes 
Income Taxes
We provide for income taxes using the liability method. Under this method, deferred income tax assets and liabilities are determined based on the differences between the financial statement carrying amounts of existing assets and liabilities at each year end and their respective tax bases and are measured using enacted tax rates in effect for the year in which the differences are expected to affect taxable income. Significant judgment is required by management to determine our provision for income taxes, our deferred tax assets and liabilities, and the valuation allowance to record against our net deferred tax assets, which are based on complex and evolving tax regulations throughout the world. Deferred tax assets and other tax benefits are recorded when it is more likely than not that the position will be sustained upon audit. While we have begun to utilize certain of our net operating losses, we have not yet established a track record of profitability. Accordingly, valuation allowances have been recorded to reduce our net deferred tax assets to zero, with the exception of the alternative minimum tax ("AMT") credit carryover. Under the Tax Cuts and Jobs Act enacted in December 2017, the AMT credit carryover will either be utilized, or if unutilized fully refunded in 2022. For all other deferred tax assets the valuation allowance will reduce the net value to zero until such time as we can demonstrate an ability to realize them.
Net Income (Loss) Per Share 
Net Income (Loss) Per Share
Basic net income (loss) per common share is computed by dividing net income (loss) for the period by the weighted average number of common shares outstanding during the period, without consideration for common stock equivalents. Outstanding stock options, unvested RSAs, unvested RSUs and unvested PRSUs are considered common stock equivalents and are only included in the calculation of diluted earnings per common share when net income is reported and their effect is dilutive.
Segment Information 
Segment Information
We operate our business in one segment, which includes all activities related to the research, development and commercialization of our proprietary enzymes. This segment also includes revenues and expenses related to (i) research and development and bulk rHuPH20 manufacturing activities conducted under our collaborative agreements with third parties and (ii) product sales of Hylenex recombinant. The chief operating decision-maker reviews the operating results on an aggregate basis and manages the operations as a single operating segment.
Adoption and Pending Adoption of Recent Accounting Pronouncements 
Adoption and Pending Adoption of Recent Accounting Pronouncements
The following table provides a brief description of recently issued accounting standards, those adopted in the current period and those not yet adopted:
Standard
 
Description
 
Effective Date
 
Effect on the Financial
Statements or Other Significant Matters
 
 
 
 
 
 
 
In July 2015, the FASB issued ASU 2015-11, Inventory: Simplifying the Measurement of Inventory.
 
The new guidance requires that for entities that measure inventory using the first-in, first-out method, inventory should be measured at the lower of cost or net realizable value. Topic 330, Inventory, currently requires an entity to measure inventory at the lower of cost or market. Market could be replacement cost, net realizable value, or net realizable value less an approximate normal profit margin. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation.
 
January 1, 2017.
 
The adoption did not have a material impact on our consolidated financial position or results of operations.
 
 
 
 
 
 
 
In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740), Balance Sheet Classification of Deferred Tax Assets
 
The amendments in this update simplify the presentation of deferred income taxes by requiring that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position.

 
January 1, 2017
 
The adoption of this guidance did not have a significant impact on the Company’s financial statements.

 
 
 
 
 
 
 
In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments.

In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows: Restricted Cash.
 
Current U.S. GAAP either is unclear or does not include specific guidance on the eight cash flow classification issues included in ASU 2016-15. The new guidance is an improvement to U.S. GAAP and is intended to reduce the current and potential future diversity in practice. ASU 2016-18 provides additional classification guidance for restricted cash, which requires that restricted cash be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows.
 
January 1, 2018. We have elected to early adopt as of January 1, 2017.
 
Cash and cash equivalents at the beginning-of-period and end-of-period total amounts in the Consolidated Statements of Cash Flows have been adjusted to include $0.5 million of restricted cash for each of the periods presented.
 
 
 
 
 
 
 
Standard
 
Description
 
Effective Date
 
Effect on the Financial
Statements or Other Significant Matters
In January 2016, the FASB issued ASU 2016-01, Financial Instruments - Overall; Recognition and Measurement of Financial Assets and Financial Liabilities.
 
The new guidance supersedes the guidance to classify equity securities with readily determinable fair values into different categories (that is, trading or available-for-sale) and requires equity securities to be measured at fair value with changes in the fair value recognized through net income. The new guidance requires public business entities that are required to disclose fair value of financial instruments measured at amortized cost on the balance sheet to measure that fair value using the exit price notion consistent with Topic 820, Fair Value Measurement.
 
January 1, 2018.
 
We currently do not hold equity securities, and we are evaluating the effect the updated standard will have on our consolidated financial statements and related disclosures.
 
 
 
 
 
 
 
In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). In March, April, May and December 2016, the FASB issued additional guidance related to Topic 606.
 
The new standard will supersede nearly all existing revenue recognition guidance. Under Topic 606, an entity is required to recognize revenue upon transfer of promised goods or services to customers in an amount that reflects the expected consideration to be received in exchange for those goods or services. Topic 606 defines a five-step process in order to achieve this core principle, which may require the use of judgment and estimates, and also requires expanded qualitative and quantitative disclosures relating to the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers, including significant judgments and estimates used. The new standard also defines accounting for certain costs related to origination and fulfillment of contracts with customers, including whether such costs should be capitalized. The new standard permits adoption either by using (i) a full retrospective approach for all periods presented in the period of adoption or (ii) a modified retrospective approach where the new standard is applied in the financial statements starting with the year of adoption. Under both approaches, cumulative impact of the adoption is reflected as an adjustment to retained earnings (accumulated equity (deficit)) as of the earliest date presented in accordance with the new standard.


 
January 1, 2018. Early adoption is permitted.
 
We plan to implement the new guidance on January 1, 2018 using the modified retrospective approach. We have substantially completed our evaluation of the effect that the updated standard will have on our consolidated financial statements and related disclosures. Adoption of the new guidance will impact the timing of recognition of payments related to certain of our license and collaboration agreements (1) and the timing of recognition of our sales-based royalties.(2) This standard will have a material impact on our consolidated financial statements.

 
 
 
 
 
 
 
Standard
 
Description
 
Effective Date
 
Effect on the Financial
Statements or Other Significant Matters
In February 2016, the FASB issued ASU 2016-02, Leases.
 
The new guidance requires lessees to recognize assets and liabilities for most leases and provides enhanced disclosures.
 
January 1, 2019. Early adoption is permitted.
 
We are currently evaluating the effect the updated standard will have on our consolidated financial statements and related disclosures and do not intend to early adopt. We anticipate recognition of additional assets and corresponding liabilities related to our leases on our consolidated balance sheet.
 
 
 
 
 
 
 
In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments
 
The standard amends the impairment model by requiring entities to use a forward-looking approach based on expected losses to estimate credit losses for most financial assets and certain other instruments that aren’t measured at fair value through net income.

 
January 1, 2020
 
The Company does not believe the adoption will have a material impact on our consolidated financial position or results of operations.

Summary of Significant Accounting Policies (Tables)
Schedules of Concentration of Risk, by Risk Factor [Table Text Block] 
The following table indicates the percentage of total revenues in excess of 10% with any single customer:
 
 
Year Ended December 31,
 
 
2017
 
2016
 
2015
Roche
 
38%
 
63%
 
42%
BMS
 
32%
 
—
 
—
Alexion
 
13%
 
—
 
—
Baxalta
 
7%
 
12%
 
7%
Lilly
 
—
 
6%
 
19%
AbbVie
 
—
 
4%
 
17%
We attribute revenues under collaborative agreements, including royalties, to the individual countries where the collaborator is headquartered. We attribute revenues from product sales to the individual countries to which the product is shipped. Worldwide revenues from external customers are summarized by geographic location in the following table (in thousands):
 
 
Year Ended December 31,
 
 
2017
 
2016
 
2015
United States
 
$
196,274

 
$
52,292

 
$
77,149

Switzerland
 
119,136

 
93,067

 
57,136

All other foreign
 
1,203

 
1,332

 
772

Total revenues
 
$
316,613

 
$
146,691

 
$
135,057

Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] 
A reconciliation of the numerators and the denominators of the basic and diluted net income (loss) per common share computations is as follows (in thousands, except per share amounts):
 
 
Year Ended December 31,
 
 
2017
 
2016
 
2015
Numerator:
 
 
 
 
 
 
Net income (loss)
 
$
62,971

 
$
(103,023
)
 
$
(32,231
)
Denominator:
 
 
 
 
 
 
Weighted average common shares outstanding for basic
net income (loss) per share
 
136,419

 
127,964

 
126,704

Net effect of dilutive common stock equivalents
 
2,649

 
—

 
—

Weighted average common shares outstanding for diluted
net income (loss) per share
 
139,068

 
127,964

 
126,704

Net income (loss) per share:
 
 
 
 
 
 
Basic
 
$
0.46

 
$
(0.81
)
 
$
(0.25
)
Diluted
 
$
0.45

 
$
(0.81
)
 
$
(0.25
)
Fair Value Measurement (Tables)
Available-for-sale marketable securities 
Available-for-sale marketable securities consisted of the following (in thousands):
 
 
December 31, 2017
 
 
Amortized Cost
 
Gross Unrealized Gains
 
Gross Unrealized Losses
 
Estimated Fair Value
Corporate debt securities
 
$
117,427

 
$
—

 
$
(235
)
 
$
117,192

U.S. Treasury securities
 
66,601

 
—

 
(201
)
 
66,400

Commercial paper
 
116,882

 
—

 
—

 
116,882

 
 
$
300,910

 
$
—

 
$
(436
)
 
$
300,474


 
 
December 31, 2016
 
 
Amortized Cost
 
Gross Unrealized Gains
 
Gross Unrealized Losses
 
Estimated Fair Value
Corporate debt securities
 
$
40,221

 
$
1

 
$
(15
)
 
$
40,207

U.S. Treasury securities
 
94,002

 
24

 
(16
)
 
94,010

Commercial paper
 
4,000

 
—

 
—

 
4,000

 
 
$
138,223

 
$
25

 
$
(31
)
 
$
138,217

Investments Classified by Contractual Maturity Date [Table Text Block] 
Contractual maturities of available-for-sale debt securities are as follows (in thousands):
 
 
December 31, 2017
 
December 31, 2016
 
 
Estimated Fair Value
Due within one year
 
$
213,426

 
$
132,221

After one but within five years
 
87,048

 
5,996

 
 
$
300,474

 
$
138,217

Fair Value, Assets Measured on Recurring Basis [Table Text Block] 
The following table summarizes, by major security type, our cash equivalents and available-for-sale marketable securities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy (in thousands):
 
 
December 31, 2017
 
December 31, 2016
 
 
Level 1
 
Level 2
 
Total estimated fair value
 
Level 1
 
Level 2
 
Total estimated fair value
Cash equivalents:
 
 
 
 
 
 
 
 
 
 
 
 
Money market funds
 
$
142,091

 
$
—

 
$
142,091

 
$
60,916

 
$
—

 
$
60,916

Commercial paper
 
—

 
15,700

 
15,700

 
—

 
—

 
—

Available-for-sale marketable
   securities:
 
 
 
 
 
 
 
 
 
 
 
 
Corporate debt securities
 
—

 
117,192

 
117,192

 
—

 
40,207

 
40,207

U.S. Treasury securities
 
66,400

 
—

 
66,400

 
94,010

 
—

 
94,010

Commercial paper
 
—

 
116,882

 
116,882

 
—

 
4,000

 
4,000

 
 
$
208,491

 
$
249,774

 
$
458,265

 
$
154,926

 
$
44,207

 
$
199,133

Collaborative Agreements Collaborative Agreements (Tables)
Revenue Recognition, Multiple-deliverable Arrangements [Table Text Block] 
 
As of December 31, 2017
Upfront license fee payment for the application of rHuPH20 to the initial exclusive targets
$
20,000

Election of additional exclusive targets and annual license maintenance fees for the
   right to designate the remaining targets as exclusive targets
23,000

Clinical development milestone payments
13,000

Regulatory milestone payments
8,000

Sales-based milestone payments
22,000

Total payments received
$
86,000

Revenue Recognition, Multiple-deliverable Arrangements [Table Text Block] 
 
As of December 31, 2017
Upfront license fee payment for the application of rHuPH20 to the initial exclusive target
$
10,000

Regulatory milestone payments
3,000

Sales-based milestone payments
9,000

Total payments received
$
22,000

Revenue Recognition, Multiple-deliverable Arrangements [Table Text Block] 
 
As of December 31, 2017
Alexion Collaboration
$
40,000

BMS Collaboration
105,000

Lilly Collaboration
33,000

AbbVie Collaboration
29,000

Janssen Collaboration
30,250

Pfizer Collaboration
16,500

Total payments received
$
253,750

Revenue Recognition, Multiple-deliverable Arrangements [Table Text Block] 
Based on the results of our analysis, we allocated the following amounts to the license fee deliverable under the arrangement (in thousands):
 
Consideration allocated to
license fees:
Alexion Collaboration
$
40,000

BMS Collaboration
101,400

Lilly Collaboration
33,000

AbbVie Collaboration
23,000

Janssen Collaboration
15,250

Pfizer Collaboration
12,500

Total consideration allocated to license fees
$
225,150

Certain Balance Sheet Items (Tables)
Summary of Accounts Receivable 
Accounts receivable, net consisted of the following (in thousands):
 
 
December 31,
2017
 
December 31,
2016
Accounts receivable from product sales to collaborators
 
$
18,475

 
$
7,854

Accounts receivable from revenues under collaborative agreements
 
2,142

 
6,151

Accounts receivable from other product sales
 
2,075

 
2,234

     Subtotal
 
22,692

 
16,239

Allowance for distribution fees and discounts
 
(559
)
 
(559
)
     Total accounts receivable, net
 
$
22,133

 
$
15,680

Summary of Inventories 
Inventories consisted of the following (in thousands):
 
 
December 31,
2017
 
December 31,
2016
Raw materials
 
$
377

 
$
761

Work-in-process
 
2,131

 
12,850

Finished goods
 
2,638

 
1,012

     Total inventories
 
$
5,146

 
$
14,623

Summary of Prepaid Expenses and Other Assets 
Prepaid expenses and other assets consisted of the following (in thousands):
 
 
December 31,
2017
 
December 31,
2016
Prepaid manufacturing expenses
 
$
2,337

 
$
9,663

Prepaid research and development expenses
 
7,793

 
8,613

Other prepaid expenses
 
2,585

 
1,661

Other assets
 
6,717

 
1,530

     Total prepaid expenses and other assets
 
19,432

 
21,467

Less long-term portion
 
5,553

 
219

     Total prepaid expenses and other assets, current
 
$
13,879

 
$
21,248

Summary of Property and Equipment 
Property and equipment, net consisted of the following (in thousands):
 
 
December 31,
2017
 
December 31,
2016
Research equipment
 
$
10,970

 
$
10,479

Computer and office equipment
 
3,725

 
3,373

Leasehold improvements
 
2,715

 
2,331

     Subtotal
 
17,410

 
16,183

Accumulated depreciation and amortization
 
(13,890
)
 
(11,919
)
     Property and equipment, net
 
$
3,520

 
$
4,264

Summary of Accrued Expenses 
Accrued expenses consisted of the following (in thousands):
 
 
December 31,
2017
 
December 31,
2016
Accrued outsourced research and development expenses
 
$
18,757

 
$
9,522

Accrued compensation and payroll taxes
 
13,384

 
11,539

Accrued outsourced manufacturing expenses
 
2,504

 
3,225

Other accrued expenses
 
5,396

 
4,552

     Total accrued expenses
 
40,041

 
28,838

Less long-term portion
 
440

 
17

     Total accrued expenses, current
 
$
39,601

 
$
28,821

Summary of Deferred Revenue 
Deferred revenue consisted of the following (in thousands):
 
 
December 31,
2017
 
December 31,
2016
Collaborative agreements
 
 
 
 
License fees and event-based payments:
 
 
 
 
Roche
 
$
39,379

 
$
35,709

Other
 
15,999

 
8,209

 
 
55,378

 
43,918

Reimbursement for research and development services
 
—

 
700

Product sales
 
5,487

 
—

Total deferred revenue
 
60,865

 
44,618

Less current portion
 
6,568

 
4,793

Deferred revenue, net of current portion
 
$
54,297

 
$
39,825

Long-Term Debt, Net Debt Disclosure (Tables)
Schedule of Maturities of Long-term Debt [Table Text Block]
Future maturities and interest payments of long-term debt as of December 31, 2017, are as follows (in thousands):
2018
 
$
94,125

2019
 
105,758

2020
 
27,311

2021
 
4,755

2022
 
—

Total minimum payments
 
231,949

Less amount representing interest
 
(26,792
)
Gross balance of long-term debt
 
205,157

Less unamortized debt discount
 
(2,806
)
Present value of long-term debt
 
202,351

Less current portion of long-term debt
 
(77,211
)
Long-term debt, less current portion and unamortized debt discount
 
$
125,140

Share-based Compensation (Tables)
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Table Text Block] 
Total share-based compensation expense related to share-based awards was comprised of the following (in thousands):
 
 
Year Ended December 31,
 
 
2017
 
2016
 
2015
Research and development
 
$
13,080

 
$
11,470

 
$
9,795

Selling, general and administrative
 
17,590

 
14,115

 
11,043

Share-based compensation expense
 
$
30,670

 
$
25,585

 
$
20,838

Schedule of Compensation Cost for Share-based Payment Arrangements, Allocation of Share-based Compensation Costs by Plan [Table Text Block] 
Share-based compensation expense by type of share-based award (in thousands):
 
 
Year Ended December 31,
 
 
2017
 
2016
 
2015
Stock options
 
$
19,583

 
$
16,544

 
$
11,145

RSAs, RSUs and PRSUs
 
11,087

 
9,041

 
9,693

 
 
$
30,670

 
$
25,585

 
$
20,838

Schedule of Unrecognized Compensation Cost, Nonvested Awards [Table Text Block] 
Total unrecognized estimated compensation cost by type of award and the weighted-average remaining requisite service period over which such expense is expected to be recognized (in thousands, unless otherwise noted):
 
 
December 31, 2017
 
 
Unrecognized
Expense
 
Remaining
Weighted-Average
Recognition Period
(years)
Stock options
 
$
36,914

 
2.4
RSAs
 
$
4,610

 
1.6
RSUs
 
$
15,965

 
2.6
Share-based Compensation, Stock Options, Activity [Table Text Block] 
A summary of our stock option award activity as of and for the years ended December 31, 2017, 2016 and 2015 is as follows: 
 
 
Shares
Underlying
Stock Options
 
Weighted
Average Exercise
Price per Share
 
Weighted
Average
Remaining
Contractual
Term (years)
 
Aggregate
Intrinsic
Value
Outstanding at January 1, 2015
 
6,353,892

 
$9.18
 
 
 
 
Granted
 
3,973,604

 
$16.26
 
 
 
 
Exercised
 
(1,926,368
)
 
$7.49
 
 
 
 
Canceled/forfeited
 
(407,936
)
 
$10.64
 
 
 
 
Outstanding at December 31, 2015
 
7,993,192

 
$13.03
 
 
 
 
Granted
 
4,466,306

 
$9.03
 
 
 
 
Exercised
 
(413,248
)
 
$6.88
 
 
 
 
Canceled/forfeited
 
(955,054
)
 
$12.42
 
 
 
 
Outstanding at December 31, 2016
 
11,091,196

 
$11.70
 
 
 
 
Granted
 
2,717,614

 
$12.60
 
 
 
 
Exercised
 
(1,514,826
)
 
$9.24
 
 
 
 
Canceled/forfeited
 
(1,185,518
)
 
$11.89
 
 
 
 
Outstanding at December 31, 2017
 
11,108,466

 
$12.24
 
7.0
 

$90.8
 million
Vested and expected to vest at December 31, 2017
 
11,108,466

 
$12.24
 
7.0
 

$90.8
 million
Exercisable at December 31, 2017
 
5,493,802

 
$12.31
 
6.1
 

$44.7
 million
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block] 
The assumptions used in the Black-Scholes model were as follows:
 
 
Year Ended December 31,
 
 
2017
 
2016
 
2015
Expected volatility
 
69.8-71.7%
 
67.5-71.9%
 
66.2-67.4%
Average expected term (in years)
 
5.6
 
5.4
 
5.6
Risk-free interest rate
 
1.73-2.13%
 
1.00-1.90%
 
1.34-1.92%
Expected dividend yield
 
—
 
—
 
—
Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity [Table Text Block] 
The following table summarizes our RSA activity during the years ended December 31, 2017, 2016 and 2015:
 
 
Number of
Shares
 
Weighted
Average
Grant Date
Fair Value
Unvested at January 1, 2015
 
1,158,451

 
$10.26
Granted
 
515,695

 
$15.00
Vested
 
(721,990
)
 
$10.11
Forfeited
 
(140,676
)
 
$11.84
Unvested at December 31, 2015
 
811,480

 
$13.13
Granted
 
968,652

 
$8.41
Vested
 
(296,831
)
 
$12.76
Forfeited
 
(180,198
)
 
$10.33
Unvested at December 31, 2016
 
1,303,103

 
$10.09
Granted
 
98,945

 
$14.15
Vested
 
(514,613
)
 
$10.23
Forfeited
 
(108,485
)
 
$9.62
Unvested at December 31, 2017
 
778,950

 
$10.59
Schedule of Share-based Compensation, Restricted Stock Units Award Activity [Table Text Block] 
The following table summarizes our RSU activity during the years ended December 31, 2017, 2016 and 2015:
 
 
Number of
Shares
 
Weighted
Average
Grant Date
Fair Value
 
Weighted
Average
Remaining
Contractual
Term (yrs)
 
Aggregate
Intrinsic
Value
Unvested at January 1, 2015
 
462,322

 
$11.12
 
 
 
 
Granted
 
422,492

 
$14.75
 
 
 
 
Vested
 
(134,088
)
 
$10.93
 
 
 
 
Forfeited
 
(84,512
)
 
$10.86
 
 
 
 
Outstanding at December 31, 2015
 
666,214

 
$13.49
 
 
 
 
Granted
 
796,582

 
$8.17
 
 
 
 
Vested
 
(218,279
)
 
$12.74
 
 
 
 
Forfeited
 
(77,948
)
 
$10.99
 
 
 
 
Outstanding at December 31, 2016
 
1,166,569

 
$10.16
 
 
 
 
Granted
 
1,378,273

 
$12.13
 
 
 
 
Vested
 
(378,406
)
 
$10.48
 
 
 
 
Forfeited
 
(251,261
)
 
$11.11
 
 
 
 
Outstanding at December 31, 2017
 
1,915,175

 
$11.39
 
1.4
 

$38.8
 million
Schedule of Nonvested Performance-based Units Activity [Table Text Block] 
The following table summarizes our PRSU activity during the years ended December 31, 2017, 2016 and 2015:
 
 
Number of
Shares
 
Weighted
Average
Grant Date
Fair Value
Outstanding at January 1, 2015
 
431,238

 

$8.91

Granted
 
118,209

 

$11.19

Vested
 
(83,380
)
 

$9.48

Forfeited
 
(156,360
)
 

$9.21

Outstanding at December 31, 2015
 
309,707

 

$9.48

Granted
 
—

 
—

Vested
 
(30,037
)
 

$9.49

Forfeited
 
(79,415
)
 

$9.44

Outstanding at December 31, 2016
 
200,255

 

$9.49

Granted
 
—

 
—

Vested
 
—

 
—

Forfeited
 
(200,255
)
 

$9.49

Outstanding at December 31, 2017
 
—

 
—

Commitments and Contingencies Commitments and Contingencies (Tables)
Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block]
Approximate annual future minimum operating lease payments as of December 31, 2017 are as follows (in thousands): 
Year:
 
Operating
Leases
2018
 
$
2,415

2019
 
2,785

2020
 
2,824

2021
 
2,470

2022
 
2,506

Total minimum lease payments
 
$
13,000

Income Taxes (Tables)
Schedule of Income before Income Tax, Domestic and Foreign [Table Text Block] 
Total income (loss) before income taxes summarized by region were as follows (in thousands):
 
 
Year Ended December 31,
 
 
2017
 
2016
 
2015
United States
 
$
160,938

 
$
6,384

 
$
11,724

Foreign
 
(99,328
)
 
(108,245
)
 
(43,955
)
Net income (loss) before income taxes
 
$
61,610

 
$
(101,861
)
 
$
(32,231
)
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] 
Significant components of our net deferred tax assets/(liabilities) were as follows (in thousands).
 
 
December 31,
 
 
2017
 
2016
Deferred tax assets:
 
 
 
 
Net operating loss carryforwards
 
$
32,630

 
$
103,296

Deferred revenue
 
8,815

 
15,354

Research and development and orphan drug credits
 
75,224

 
73,701

Share-based compensation
 
7,423

 
8,844

Alternative minimum tax credit
 
5,532

 
1,494

Other, net
 
2,270

 
1,021

 
 
131,894

 
203,710

Valuation allowance for deferred tax assets
 
(126,189
)
 
(203,370
)
Deferred tax assets, net of valuation
 
5,705

 
340

Deferred tax liabilities:
 
 
 
 
Depreciation
 
(173
)
 
(340
)
Total deferred tax liabilities
 
(173
)
 
(340
)
Net deferred tax asset (liability)
 
$
5,532

 
$
—

Schedule of Components of Income Tax Expense (Benefit) [Table Text Block] 
Income tax expense was comprised of the following components (in thousands):
 
 
Year Ended December 31,
 
 
2017
 
2016
 
2015
Current - federal
 
$
4,051

 
$
1,145

 
$
—

Current - state
 
120

 
17

 
—

Deferred - federal
 
(5,532
)
 
—

 
—

Deferred - state
 
—

 
—

 
—

 
 
$
(1,361
)
 
$
1,162

 
$
—

Schedule of Effective Income Tax Rate Reconciliation [Table Text Block] 
The provision for income taxes on earnings subject to income taxes differs from the statutory federal income tax rate due to the following (in thousands):
 
 
Year Ended December 31,
 
 
2017
 
2016
 
2015
Federal income tax expense (benefit) at 34%
 
$
20,947

 
$
(34,633
)
 
$
(10,959
)
State income tax benefit, net of federal income tax impact
 
930

 
(653
)
 
5,524

(Decrease) increase in valuation allowance
 
(77,181
)
 
11,252

 
4,045

Enactment of the Tax Cuts and Jobs Act
 
17,132

 
—

 
—

Foreign income subject to tax at other than federal statutory rate
 
33,674

 
36,803

 
14,945

Shared-based compensation
 
525

 
3,735

 
(4,990
)
Non-deductible expenses and other
 
5,779

 
698

 
6,457

Research and development credits, net
 
4,162

 
(1,084
)
 
(3,861
)
Orphan drug credits, net of federal add back
 
(7,329
)
 
(14,956
)
 
(11,161
)
 
 
$
(1,361
)
 
$
1,162

 
$
—

Summary of Positions for which Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Table Text Block] 
The following table summarizes the activity related to our unrecognized tax benefits (in thousands):
 
 
Year Ended December 31,
 
 
2017
 
2016
 
2015
Gross unrecognized tax benefits at beginning of period
 
$
12,799

 
$
4,898

 
$
—

Increases in tax positions for prior years
 
—

 
5,615

 
—

Decreases in tax positions for prior years
 
(2,518
)
 
(4,898
)
 
—

Increases in tax positions for current year
 
4,147

 
7,184

 
4,898

Gross unrecognized tax benefits at end of period
 
$
14,428

 
$
12,799

 
$
4,898

Summary of Operating Loss Carryforwards [Table Text Block] 
The following table shows key expiration dates of the federal and California net operating loss carryforwards (in thousands):
 
 
 
 
Expires in:
 
 
Net Operating Loss
 
2018
 
2021 and beyond
 
2028 and beyond
Federal
 
$
88,516

 
—

 
$
88,516

 
—

California
 
$
243,080

 
—

 
—

 
$
243,080

Summary of Unaudited Quarterly Financial Information (Tables)
Quarterly Financial Information [Table Text Block]
The following is a summary of our unaudited quarterly results for the years ended December 31, 2017 and 2016 (in thousands):
 
 
Quarter Ended
2017 (Unaudited):
 
March 31,
 
June 30,
 
September 30,
 
December 31,
Total revenues (1) (2)
 
$
29,568

 
$
33,750

 
$
63,731

 
$
189,564

Gross profit on product sales
 
$
3,890

 
$
4,992

 
$
5,257

 
$
5,105

Total operating expenses
 
$
57,094

 
$
59,228

 
$
55,654

 
$
63,635

Net income (loss)
 
$
(32,897
)
 
$
(30,763
)
 
$
2,749

 
$
123,882

Net income (loss) per share:
 
 
 
 
 
 
 
 
Basic
 
$
(0.26
)
 
$
(0.23
)
 
$
0.02

 
$
0.87

Diluted
 
$
(0.26
)
 
$
(0.23
)
 
$
0.02

 
$
0.85

Shares used in computing net income (loss) per share:
 
 
 
 
 
 
 
 
Basic
 
128,615

 
134,013

 
141,190

 
141,718

Diluted
 
128,615

 
134,013

 
143,236

 
145,633

 
 
Quarter Ended
2016 (Unaudited):
 
March 31,
 
June 30,
 
September 30,
 
December 31,
Total revenues
 
$
42,499

 
$
33,336

 
$
31,853

 
$
39,003

Gross profit on product sales
 
$
5,178

 
$
5,391

 
$
4,197

 
$
5,420

Total operating expenses
 
$
58,668

 
$
55,059

 
$
54,596

 
$
61,578

Net loss
 
$
(19,816
)
 
$
(26,875
)
 
$
(28,946
)
 
$
(27,386
)
Net loss per share, basic and diluted
 
$
(0.16
)
 
$
(0.21
)
 
$
(0.23
)
 
$
(0.21
)
Shares used in computing basic and diluted net loss per share
 
127,615

 
127,958

 
128,154

 
128,185

_______________
(1)
Revenues for the quarter ended December 31, 2017 included $101.4 million, $40.0 million and $15.0 million in revenue under collaborative arrangements from BMS, Alexion and Janssen, respectively.
(2)
Revenues for the quarter ended September 30, 2017 included $30.0 million in revenue under collaborative arrangements from the 2017 Roche Collaboration.
Summary of Significant Accounting Policies Restricted Cash (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2017
Dec. 31, 2016
Restricted Cash and Investments, Current [Abstract]
 
 
Restricted cash
$ 500 
$ 500 
Summary of Significant Accounting Policies Concentrations of Credit Risk (Details) (USD $)
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Concentration Risk [Line Items]
 
 
 
Allowance for Doubtful Accounts Receivable, Current
$ 0 
 
 
Geographic Concentration Risk [Member]
 
 
 
Concentration Risk [Line Items]
 
 
 
Revenue, Net
316,613,000 
146,691,000 
135,057,000 
Sales [Member] |
Customer Concentration Risk [Member]
 
 
 
Concentration Risk [Line Items]
 
 
 
Concentration Risk, Percentage
10.00% 
 
 
UNITED STATES |
Geographic Concentration Risk [Member]
 
 
 
Concentration Risk [Line Items]
 
 
 
Revenue, Net
196,274,000 
52,292,000 
77,149,000 
SWITZERLAND |
Geographic Concentration Risk [Member]
 
 
 
Concentration Risk [Line Items]
 
 
 
Revenue, Net
119,136,000 
93,067,000 
57,136,000 
All other foreign [Member] |
Geographic Concentration Risk [Member]
 
 
 
Concentration Risk [Line Items]
 
 
 
Revenue, Net
1,203,000 
1,332,000 
772,000 
GERMANY
 
 
 
Concentration Risk [Line Items]
 
 
 
Long-Lived Assets
$ 100,000 
$ 100,000 
 
Roche [Member] |
Sales [Member] |
Customer Concentration Risk [Member]
 
 
 
Concentration Risk [Line Items]
 
 
 
Concentration Risk, Percentage
38.00% 
63.00% 
42.00% 
BMS [Member] |
Sales [Member] |
Customer Concentration Risk [Member]
 
 
 
Concentration Risk [Line Items]
 
 
 
Concentration Risk, Percentage
32.00% 
0.00% 
0.00% 
Alexion [Member] |
Sales [Member] |
Customer Concentration Risk [Member]
 
 
 
Concentration Risk [Line Items]
 
 
 
Concentration Risk, Percentage
13.00% 
0.00% 
0.00% 
Baxalta [Member] |
Sales [Member] |
Customer Concentration Risk [Member]
 
 
 
Concentration Risk [Line Items]
 
 
 
Concentration Risk, Percentage
7.00% 
12.00% 
7.00% 
Lilly [Member] |
Sales [Member] |
Customer Concentration Risk [Member]
 
 
 
Concentration Risk [Line Items]
 
 
 
Concentration Risk, Percentage
0.00% 
6.00% 
19.00% 
AbbVie [Member] |
Sales [Member] |
Customer Concentration Risk [Member]
 
 
 
Concentration Risk [Line Items]
 
 
 
Concentration Risk, Percentage
0.00% 
4.00% 
17.00% 
Roche and Baxalta [Member] |
Accounts Receivable [Member] |
Customer Concentration Risk [Member]
 
 
 
Concentration Risk [Line Items]
 
 
 
Concentration Risk, Percentage (instant date)
86.00% 
81.00% 
 
Bulk formulation [Member] |
Accounts Payable [Member] |
Supplier Concentration Risk [Member]
 
 
 
Concentration Risk [Line Items]
 
 
 
Number of manufacturers
2 
 
 
Concentration Risk, Percentage (instant date)
4.00% 
13.00% 
 
Hylenex Recombinant [Member] |
Accounts Payable [Member] |
Supplier Concentration Risk [Member]
 
 
 
Concentration Risk [Line Items]
 
 
 
Concentration Risk, Percentage (instant date)
1.00% 
2.00% 
 
Summary of Significant Accounting Policies Accounts Receivable (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2017
Accounting Policies [Abstract]
 
Allowance for Doubtful Accounts Receivable, Current
$ 0 
Summary of Significant Accounting Policies Inventories (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2017
Dec. 31, 2016
Inventory [Line Items]
 
 
Inventory, Net
$ 5,146 
$ 14,623 
Hylenex Recombinant [Member]
 
 
Inventory [Line Items]
 
 
Inventory, Net
2,900 
2,300 
bulk rHuPH20
 
 
Inventory [Line Items]
 
 
Inventory, Net
$ 2,200 
$ 12,300 
Summary of Significant Accounting Policies Property and Equipment (Details)
12 Months Ended
Dec. 31, 2017
Accounting Policies [Abstract]
 
Property, Plant and Equipment, Useful Life
3 years 
Summary of Significant Accounting Policies Impairment of Long-Lived Assets (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Accounting Policies [Abstract]
 
 
Impairment of Long-Lived Assets Held-for-use
$ 0 
$ 0 
Summary of Significant Accounting Policies Revenue recognition (Details)
12 Months Ended
Dec. 31, 2017
Collaborative agreements termination notification
 
Notification period for termination
90 days 
Period prior to expiration
 
Collaborative agreements termination notification
 
Notification period for termination
30 days 
Period after expiration
 
Collaborative agreements termination notification
 
Notification period for termination
90 days 
Summary of Significant Accounting Policies Research and development (Details) (In-license technologies [Member], USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2017
In-license technologies [Member]
 
Research and Development Arrangement, Contract to Perform for Others [Line Items]
 
Research and Development, in-line technologies
$ 0 
Summary of Significant Accounting Policies Income tax (Details) (USD $)
Dec. 31, 2017
Income Tax Disclosure [Abstract]
 
Deferred tax asset excluding amount for AMT
$ 0 
Summary of Significant Accounting Policies Net Loss Per Share (Details) (USD $)
In Thousands, except Share data, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2017
Sep. 30, 2017
Jun. 30, 2017
Mar. 31, 2017
Dec. 31, 2016
Sep. 30, 2016
Jun. 30, 2016
Mar. 31, 2016
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Loss Per Share Disclosure [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Net income (loss)
$ 123,882 
$ 2,749 
$ (30,763)
$ (32,897)
$ (27,386)
$ (28,946)
$ (26,875)
$ (19,816)
$ 62,971 
$ (103,023)
$ (32,231)
Weighted Average Number of Shares Outstanding, Basic
141,718,000 
141,190,000 
134,013,000 
128,615,000 
 
 
 
 
136,419,000 
127,964,000 
126,704,000 
Shares excluded from calculation of diluted net loss, amount
 
 
 
 
 
 
 
 
2,649,000 
0 
0 
Weighted Average Number of Shares Outstanding, Diluted
145,633,000 
143,236,000 
134,013,000 
128,615,000 
 
 
 
 
139,068,000 
127,964,000 
126,704,000 
Earnings Per Share, Basic
$ 0.87 
$ 0.02 
$ (0.23)
$ (0.26)
 
 
 
 
$ 0.46 
$ (0.81)
$ (0.25)
Earnings Per Share, Diluted
$ 0.85 
$ 0.02 
$ (0.23)
$ (0.26)
 
 
 
 
$ 0.45 
$ (0.81)
$ (0.25)
Net loss per share (Textuals) [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount
 
 
 
 
 
 
 
 
7,100,000 
13,800,000 
9,800,000 
Summary of Significant Accounting Policies Segment information (Details)
12 Months Ended
Dec. 31, 2017
Segment
Segment Reporting [Abstract]
 
Number of Operating Segments
1 
Summary of Significant Accounting Policies Adoption of Recent Accounting Pronouncements (Details) (USD $)
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Jan. 1, 2018
New Accounting Pronouncements and Changes in Accounting Principles [Abstract]
 
 
 
 
Reclassification of restricted cash
$ 500,000 
$ 500,000 
$ 500,000 
 
Revenue, amortization of license payments
4,100,000 
 
 
 
Deferred Revenue Relating To Upfront Payment License Fees
51,800,000 
 
 
 
Hypothetical License Revenue under ASC 606
198,400,000 
 
 
 
New Accounting Pronouncement or Change in Accounting Principle, Cumulative Effect of Change on Equity or Net Assets
 
 
 
19,400,000 
Royalty Revenue
63,507,000 
50,984,000 
30,975,000 
 
Hypothetical Royalty Revenue under ASC 606
$ 68,900,000 
 
 
 
Fair Value Measurement (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2017
Dec. 31, 2016
Schedule of Available-for-sale Securities
 
 
Amortized cost
$ 300,910 
$ 138,223 
Gross Unrealized Gains
0 
25 
Gross Unrealized Losses
(436)
(31)
Estimated fair value
300,474 
138,217 
Corporate Debt Securities [Member]
 
 
Schedule of Available-for-sale Securities
 
 
Amortized cost
117,427 
40,221 
Gross Unrealized Gains
0 
1 
Gross Unrealized Losses
(235)
(15)
Estimated fair value
117,192 
40,207 
US Treasury Securities [Member]
 
 
Schedule of Available-for-sale Securities
 
 
Amortized cost
66,601 
94,002 
Gross Unrealized Gains
0 
24 
Gross Unrealized Losses
(201)
(16)
Estimated fair value
66,400 
94,010 
Commercial Paper [Member]
 
 
Schedule of Available-for-sale Securities
 
 
Amortized cost
116,882 
4,000 
Gross Unrealized Gains
0 
0 
Gross Unrealized Losses
0 
0 
Estimated fair value
$ 116,882 
$ 4,000 
Fair Value Measurement Textuals (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Fair Value Disclosures [Abstract]
 
Number of available-for-sale securities in unrealized loss position, less than one year
28 
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value
$ 183.6 
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss
0.4 
Other than Temporary Impairment Losses, Marketable Securities
$ 0 
Fair Value Measurement Maturities (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2017
Dec. 31, 2016
Fair Value Disclosures [Abstract]
 
 
Due within one year
$ 213,426 
$ 132,221 
After one but within five years
87,048 
5,996 
Available-for-sale Securities
$ 300,474 
$ 138,217 
Fair Value Measurement Fair Value Measures (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2017
Dec. 31, 2016
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Available-for-sale Securities
$ 300,474 
$ 138,217 
Fair Value Disclosure
458,265 
199,133 
Fair Value, Assets, Level 1 to Level 2 Transfers, Amount
0 
0 
Money Market Funds [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Cash Equivalents
142,091 
60,916 
Commercial Paper [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Cash Equivalents
15,700 
0 
Available-for-sale Securities
116,882 
4,000 
Corporate Debt Securities [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Available-for-sale Securities
117,192 
40,207 
US Treasury Securities [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Available-for-sale Securities
66,400 
94,010 
Fair Value, Inputs, Level 1 [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Fair Value Disclosure
208,491 
154,926 
Fair Value, Inputs, Level 1 [Member] |
Money Market Funds [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Cash Equivalents
142,091 
60,916 
Fair Value, Inputs, Level 1 [Member] |
US Treasury Securities [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Available-for-sale Securities
66,400 
94,010 
Fair Value, Inputs, Level 2 [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Fair Value Disclosure
249,774 
44,207 
Fair Value, Inputs, Level 2 [Member] |
Commercial Paper [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Cash Equivalents
15,700 
0 
Available-for-sale Securities
116,882 
4,000 
Fair Value, Inputs, Level 2 [Member] |
Corporate Debt Securities [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Available-for-sale Securities
117,192 
40,207 
Fair Value, Inputs, Level 3 [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Investments, Level 3
$ 0 
$ 0 
Collaborative Agreements Collaborative Agreements Textuals (Details) (USD $)
12 Months Ended
Dec. 31, 2017
Compound
Dec. 31, 2016
Dec. 31, 2015
Collaborative Agreements Terms
 
 
 
Number of targets optional, additional fees contingent
2 
 
 
Notification period for termination
90 days 
 
 
Deferred Revenue (Textual) [Abstract]
 
 
 
Deferred revenue relating to upfront payment license fees and annual maintenance fees
$ 60,865,000 
$ 44,618,000 
 
Collaborative Agreements (Textual)
 
 
 
Additional maximum proceeds receivable from collaborators of license and collaborative agreement upon achievement of clinical development milestones for elected targets
62,500,000 
 
 
Sales-based payment to be received upon the first commercial sale
12,000,000 
 
 
Roche [Member]
 
 
 
Deferred Revenue (Textual) [Abstract]
 
 
 
Deferred revenue relating to upfront payment license fees and annual maintenance fees
39,379,000 
35,709,000 
 
Baxalta [Member]
 
 
 
Deferred Revenue (Textual) [Abstract]
 
 
 
Deferred revenue relating to upfront payment license fees and annual maintenance fees
12,400,000 
8,200,000 
 
Roche [Member]
 
 
 
Collaborative Agreements Terms
 
 
 
Number of product compound combinations licensed to develop
13 
 
 
Number of exclusive right targets
3 
 
 
Number of additional targets, optional
10 
 
 
Number of targets elected
8 
 
 
Number of targets elected, additional exclusive targets
2 
 
 
Collaborative agreement target selection period
10 years 
 
 
Duration of royalty receivable
10 years 
 
 
Deferred Revenue (Textual) [Abstract]
 
 
 
Nonrefundable Upfront License Fee Payment Received Under Collaborative Agreement
20,000,000 
 
 
Collaborative Agreements (Textual)
 
 
 
Deferred revenue, revenue recognized
3,300,000 
3,300,000 
3,300,000 
2017 Roche [Member]
 
 
 
Collaborative Agreements Terms
 
 
 
Number of targets elected, additional exclusive targets
1 
 
 
Duration of royalty receivable
10 years 
 
 
Notification period for termination
90 days 
 
 
Deferred Revenue (Textual) [Abstract]
 
 
 
Nonrefundable Upfront License Fee Payment Received Under Collaborative Agreement
30,000,000 
 
 
Baxalta [Member]
 
 
 
Collaborative Agreements Terms
 
 
 
Duration of royalty receivable
10 years 
 
 
Deferred Revenue (Textual) [Abstract]
 
 
 
Nonrefundable Upfront License Fee Payment Received Under Collaborative Agreement
10,000,000 
 
 
Collaborative Agreements (Textual)
 
 
 
Deferred revenue, revenue recognized
800,000 
800,000 
800,000 
Alexion [Member]
 
 
 
Collaborative Agreements Terms
 
 
 
Number of product compound combinations licensed to develop
4 
 
 
Number of additional targets, optional
2 
 
 
Number of targets elected, additional exclusive targets
2 
 
 
Duration of royalty receivable
10 years 
 
 
Notification period for termination
90 days 
 
 
Deferred Revenue (Textual) [Abstract]
 
 
 
Nonrefundable Upfront License Fee Payment Received Under Collaborative Agreement
40,000,000 
 
 
BMS [Member]
 
 
 
Collaborative Agreements Terms
 
 
 
Number of product compound combinations licensed to develop
11 
 
 
Number of targets elected, additional semi-exclusive targets
1 
 
 
Duration of royalty receivable
10 years 
 
 
Deferred Revenue (Textual) [Abstract]
 
 
 
Nonrefundable Upfront License Fee Payment Received Under Collaborative Agreement
101,400,000 
 
 
Lilly [Member]
 
 
 
Collaborative Agreements Terms
 
 
 
Number of product compound combinations licensed to develop
5 
 
 
Number of additional targets, optional
2 
 
 
Number of targets elected, additional exclusive targets
2 
 
 
Number of targets elected, additional semi-exclusive targets
1 
 
 
Duration of royalty receivable
10 years 
 
 
Notification period for termination
60 days 
 
 
Deferred Revenue (Textual) [Abstract]
 
 
 
Nonrefundable Upfront License Fee Payment Received Under Collaborative Agreement
33,000,000 
 
 
AbbVie [Member]
 
 
 
Collaborative Agreements Terms
 
 
 
Number of product compound combinations licensed to develop
9 
 
 
Number of additional targets, optional
8 
 
 
Number of targets elected
1 
 
 
Duration of royalty receivable
10 years 
 
 
Notification period for termination
90 days 
 
 
Deferred Revenue (Textual) [Abstract]
 
 
 
Nonrefundable Upfront License Fee Payment Received Under Collaborative Agreement
23,000,000 
 
 
Janssen [Member]
 
 
 
Collaborative Agreements Terms
 
 
 
Number of product compound combinations licensed to develop
5 
 
 
Number of additional targets, optional
4 
 
 
Number of targets elected
1 
 
 
Duration of royalty receivable
10 years 
 
 
Notification period for termination
90 days 
 
 
Deferred Revenue (Textual) [Abstract]
 
 
 
Nonrefundable Upfront License Fee Payment Received Under Collaborative Agreement
15,250,000 
 
 
Pfizer [Member]
 
 
 
Collaborative Agreements Terms
 
 
 
Number of product compound combinations licensed to develop
6 
 
 
Number of additional targets, optional
3 
 
 
Number of targets elected
5 
 
 
Number of Returned Targets
 
2 
 
Duration of royalty receivable
10 years 
 
 
Notification period for termination
30 days 
 
 
Deferred Revenue (Textual) [Abstract]
 
 
 
Nonrefundable Upfront License Fee Payment Received Under Collaborative Agreement
12,500,000 
 
 
Other collaborators [Member]
 
 
 
Deferred Revenue (Textual) [Abstract]
 
 
 
Nonrefundable Upfront License Fee Payment Received Under Collaborative Agreement
225,150,000 
 
 
Collaborative Agreements (Textual)
 
 
 
Revenue Recognition, Event-based or Milestone, Revenue Recognized
$ 15,000,000 
$ 6,000,000 
$ 1,000,000 
Collaborative Agreements Collaborative Agreements tables (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2017
Roche [Member]
 
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
 
Nonrefundable Upfront License Fee Payment Received Under Collaborative Agreement
$ 20,000 
Additional Exclusive Targets And Annual License Maintenance Fees
23,000 
Clinical development milestone payments
13,000 
Regulatory milestone payments
8,000 
Sales-based milestone payments
22,000 
Total Proceeds from Partner of License and Collaborative Agreement
86,000 
Baxalta [Member]
 
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
 
Nonrefundable Upfront License Fee Payment Received Under Collaborative Agreement
10,000 
Regulatory milestone payments
3,000 
Sales-based milestone payments
9,000 
Total Proceeds from Partner of License and Collaborative Agreement
22,000 
Lilly [Member]
 
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
 
Nonrefundable Upfront License Fee Payment Received Under Collaborative Agreement
33,000 
Total Proceeds from Partner of License and Collaborative Agreement
33,000 
AbbVie [Member]
 
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
 
Nonrefundable Upfront License Fee Payment Received Under Collaborative Agreement
23,000 
Total Proceeds from Partner of License and Collaborative Agreement
29,000 
Janssen [Member]
 
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
 
Nonrefundable Upfront License Fee Payment Received Under Collaborative Agreement
15,250 
Total Proceeds from Partner of License and Collaborative Agreement
30,250 
Pfizer [Member]
 
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
 
Nonrefundable Upfront License Fee Payment Received Under Collaborative Agreement
12,500 
Total Proceeds from Partner of License and Collaborative Agreement
16,500 
BMS [Member]
 
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
 
Nonrefundable Upfront License Fee Payment Received Under Collaborative Agreement
101,400 
Total Proceeds from Partner of License and Collaborative Agreement
105,000 
Alexion [Member]
 
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
 
Nonrefundable Upfront License Fee Payment Received Under Collaborative Agreement
40,000 
Total Proceeds from Partner of License and Collaborative Agreement
40,000 
Other collaborators [Member]
 
Revenue Recognition, Multiple-deliverable Arrangements [Line Items]
 
Nonrefundable Upfront License Fee Payment Received Under Collaborative Agreement
225,150 
Total Proceeds from Partner of License and Collaborative Agreement
$ 253,750 
Certain Balance Sheet Items - Accounts receivable (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2017
Dec. 31, 2016
Accounts Receivable, Net, Current [Abstract]
 
 
Accounts receivable from product sales to collaborators
$ 18,475 
$ 7,854 
Accounts receivable from revenues under collaborative agreements
2,142 
6,151 
Accounts receivable from other product sales
2,075 
2,234 
Accounts receivable, gross
22,692 
16,239 
Allowance for distribution fees and discounts
(559)
(559)
Total accounts receivable, net
$ 22,133 
$ 15,680 
Certain Balance Sheet Items - Inventories (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2017
Dec. 31, 2016
Inventory Disclosure [Abstract]
 
 
Inventory, Raw Materials
$ 377 
$ 761 
Inventory, Work in Process
2,131 
12,850 
Inventory, Finished Goods
2,638 
1,012 
Summary of Inventories
 
 
Total inventories
$ 5,146 
$ 14,623 
Certain Balance Sheet Items - Prepaid expenses and other assets (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2017
Dec. 31, 2016
Prepaid Expense and Other Assets, Current [Abstract]
 
 
Prepaid manufacturing expenses
$ 2,337 
$ 9,663 
Prepaid research and development expenses
7,793 
8,613 
Other prepaid expenses
2,585 
1,661 
Other assets
6,717 
1,530 
Total prepaid expense and other assets
19,432 
21,467 
Less long-term portion
5,553 
219 
Total prepaid expense and other assets, current
$ 13,879 
$ 21,248 
Certain Balance Sheet Items - Property and Equipment (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2017
Dec. 31, 2016
Property and equipment, gross
$ 17,410 
$ 16,183 
Accumulated depreciation and amortization
(13,890)
(11,919)
Property and equipment, net
3,520 
4,264 
Research equipment
 
 
Property and equipment, gross
10,970 
10,479 
Computer and office equipment
 
 
Property and equipment, gross
3,725 
3,373 
Leasehold improvements
 
 
Property and equipment, gross
$ 2,715 
$ 2,331 
Certain Balance Sheet Items - Property and Equipment, Net (Textuals) (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Depreciation and amortization
 
 
 
Depreciation and amortization
$ 2,161 
$ 2,410 
$ 1,700 
Certain Balance Sheet Items - Accrued Expenses (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2017
Dec. 31, 2016
Summary of Accrued Expenses
 
 
Accrued outsourced research and development
$ 18,757 
$ 9,522 
Accrued compensation and payroll taxes
13,384 
11,539 
Accrued outsourced manufacturing expenses
2,504 
3,225 
Other accrued expenses
5,396 
4,552 
Total accrued expenses
40,041 
28,838 
Less long-term portion
440 
17 
Total accrued expenses, current
$ 39,601 
$ 28,821 
Certain Balance Sheet Items - Deferred Revenue (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2017
Dec. 31, 2016
Deferred revenue
 
 
Total deferred revenue
$ 60,865 
$ 44,618 
Less current portion
6,568 
4,793 
Deferred revenue, net of current portion
54,297 
39,825 
Roche [Member]
 
 
Deferred revenue
 
 
Total deferred revenue
39,379 
35,709 
Other collaborative agreements
 
 
Deferred revenue
 
 
Total deferred revenue
15,999 
8,209 
License fees and event-based payments
 
 
Deferred revenue
 
 
Total deferred revenue
55,378 
43,918 
Research and Development Services
 
 
Deferred revenue
 
 
Total deferred revenue
0 
700 
Product [Member]
 
 
Deferred revenue
 
 
Total deferred revenue
$ 5,487 
$ 0 
Long-Term Debt, Net Long-Term Debt Textuals (Details) (USD $)
12 Months Ended 1 Months Ended 12 Months Ended 12 Months Ended
Dec. 31, 2017
Dec. 31, 2017
Royalty-backed Loan
Dec. 31, 2016
Royalty-backed Loan
Dec. 31, 2017
Royalty-backed Loan
2016 [Member]
Dec. 31, 2017
Royalty-backed Loan
2017 [Member]
Dec. 31, 2017
Royalty-backed Loan
2018 and thereafter [Member]
Dec. 31, 2017
Royalty-backed Loan
2017 Quarterly Maximum Payment [Member]
Dec. 31, 2017
Royalty-backed Loan
2018 Quarterly Maximum Payment [Member]
Dec. 31, 2017
Royalty-backed Loan
2019 Quarterly Maximum Payment [Member]
Dec. 31, 2017
Royalty-backed Loan
2020 Quarterly Maximum Payment [Member]
Dec. 31, 2017
Royalty-backed Loan
Minimum [Member]
Dec. 31, 2017
Royalty-backed Loan
Maximum [Member]
Dec. 31, 2013
Secured Debt
Dec. 31, 2015
Secured Debt
Dec. 31, 2016
Secured Debt
Dec. 31, 2017
Senior Loans [Member]
Dec. 31, 2016
Senior Loans [Member]
Dec. 31, 2015
Senior Loans [Member]
Dec. 31, 2017
Senior Loans [Member]
Minimum [Member]
Dec. 31, 2017
Senior Loans [Member]
Maximum [Member]
Debt Instrument [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Issuance date
 
Jan. 26, 2016 
 
 
 
 
 
 
 
 
 
 
 
 
 
Jun. 07, 2016 
 
 
 
 
Total loan balance
 
$ 150,000,000 
 
 
 
 
 
 
 
 
 
 
 
$ 50,000,000 
 
$ 70,000,000 
 
 
 
 
Secured debt original draw
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
55,000,000 
 
 
 
 
Interest rate, stated percentage
 
 
 
 
 
 
 
 
 
 
 
 
 
7.55% 
 
8.25% 
 
 
 
 
Debt Instrument, Description of Variable Rate Basis
 
8.75% plus the three-month LIBOR rate 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Basis Spread on Variable Rate
 
 
 
 
 
 
 
 
 
 
0.70% 
1.50% 
 
 
 
 
 
 
 
 
Debt, Interest Rate
 
10.25% 
9.71% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Royalty payments to be applied to debt instrument
 
 
 
0.00% 
50.00% 
100.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Periodic Payment
 
 
 
 
 
 
13,750,000 
18,750,000 
21,250,000 
22,500,000 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Maturity Date, Description
 
final maturity date of the Royalty-backed Loan will be the earlier of (i) the date when principal and interest is paid in full, (ii) the termination of Halozyme Royalty’s right to receive royalties under the Collaboration Agreements, and (iii) December 31, 2050 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Prepayment fee, percent
 
105.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1.00% 
2.00% 
Debt instrument, covenant in compliance
 
in compliance 
 
 
 
 
 
 
 
 
 
 
 
 
 
in compliance 
 
 
 
 
Interest Costs Capitalized
 
0 
13,200,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Accrued Interest
 
700,000 
700,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Lender Fee
 
1,500,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Issuance Cost
 
400,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest Expense, debt
 
16,400,000 
14,500,000 
 
 
 
 
 
 
 
 
 
 
 
 
5,500,000 
20,000,000 
5,200,000 
 
 
Outstanding loan balance
 
146,500,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
55,900,000 
 
 
 
 
Debt Instrument, Unamortized Discount
2,806,000 
800,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
400,000 
 
 
 
 
Term loan, increase
 
 
 
 
 
 
 
 
 
 
 
 
20,000,000 
 
 
 
 
 
 
 
Maturity date
 
Dec. 31, 2050 
 
 
 
 
 
 
 
 
 
 
 
Jan. 01, 2018 
 
Jan. 01, 2021 
 
 
 
 
Final payment as percent of original principal
 
 
 
 
 
 
 
 
 
 
 
 
 
8.50% 
 
5.50% 
 
 
 
 
Final payment
 
 
 
 
 
 
 
 
 
 
 
 
 
4,250,000 
4,250,000 
 
 
 
 
 
Debt Instrument, Unused Borrowing Capacity, Amount
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
15,000,000 
 
 
 
 
Debt Instrument, interest only period
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
interest only payments for the first 18 months 
 
 
 
 
Accrued interest, noncurrent
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
400,000 
1,100,000 
 
 
 
Accretion of debt balloon payment
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 1,300,000 
 
 
 
 
Long-Term Debt, Net Debt Table (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2017
Dec. 31, 2016
Debt Disclosure [Abstract]
 
 
2018
$ 94,125 
 
2019
105,758 
 
2020
27,311 
 
2021
4,755 
 
2022
0 
 
Total minimum payments
231,949 
 
Less amount representing interest
(26,792)
 
Gross balance of long-term debt
205,157 
 
Less unamortized debt discount
(2,806)
 
Present value of long-term debt
202,351 
 
Less current portion of long-term debt
(77,211)
(17,393)
Long-term debt, less current portion and unamortized debt discount
$ 125,140 
 
Share-based Compensation Textuals (Details)
12 Months Ended
Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Common Stock, Capital Shares Reserved for Future Issuance
6,552,249 
Options, Exercise Price, Percent of Share Price
100.00% 
Options, Outstanding, Initial Contractual Term
10 years 
Cliff Vesting, First Anniversary [Member]
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Award Vesting Rights, Percentage
25.00% 
Monthly Vesting, after One Year [Member]
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Award Vesting Rights, Percentage
2.08% 
RSUs |
Percentage Vesting [Member]
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Award Vesting Rights, Percentage
25.00% 
Outstanding awards [Member]
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Number of Shares Subject To Outstanding Awards
13,023,641 
RSAs |
Percentage Vesting [Member]
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Award Vesting Rights, Percentage
25.00% 
Amended and Restated 2011 Stock Plan [Member]
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Number of Shares Authorized
44,200,000 
Share-based Compensation Expense (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
 
 
 
Allocated Share-based Compensation Expense
$ 30,670 
$ 25,585 
$ 20,838 
Stock options
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
 
 
 
Allocated Share-based Compensation Expense
19,583 
16,544 
11,145 
RSU, RSA, and PRSU awards [Member]
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
 
 
 
Allocated Share-based Compensation Expense
11,087 
9,041 
9,693 
Research and Development Expense [Member]
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
 
 
 
Allocated Share-based Compensation Expense
13,080 
11,470 
9,795 
Selling, General and Administrative Expenses [Member]
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
 
 
 
Allocated Share-based Compensation Expense
$ 17,590 
$ 14,115 
$ 11,043 
Share-based Compensation Unrecognized Expense (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Stock options
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Stock Options
$ 36,914 
Compensation Cost Not yet Recognized, Period for Recognition
2 years 5 months 
RSAs
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Share-based Awards Other than Options
4,610 
Compensation Cost Not yet Recognized, Period for Recognition
1 year 7 months 
RSUs
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Share-based Awards Other than Options
$ 15,965 
Compensation Cost Not yet Recognized, Period for Recognition
2 years 7 months 
Share-based Compensation Options (Details) (USD $)
In Millions, except Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
 
 
 
Options, Outstanding, Number, period start
11,091,196 
7,993,192 
6,353,892 
Options, Outstanding, Weighted Average Exercise Price, period start
$ 11.70 
$ 13.03 
$ 9.18 
Options, Grants in Period, Gross
2,717,614 
4,466,306 
3,973,604 
Options, Grants in Period, Weighted Average Exercise Price
$ 12.60 
$ 9.03 
$ 16.26 
Options, Exercises in Period
(1,514,826)
(413,248)
(1,926,368)
Options, Exercises in Period, Weighted Average Exercise Price
$ 9.24 
$ 6.88 
$ 7.49 
Options, Forfeitures and Expirations in Period
(1,185,518)
(955,054)
(407,936)
Options, Forfeitures and Expirations in Period, Weighted Average Exercise Price
$ 11.89 
$ 12.42 
$ 10.64 
Options, Outstanding, Number, period end
11,108,466 
11,091,196 
7,993,192 
Options, Outstanding, Weighted Average Exercise Price, period end
$ 12.24 
$ 11.70 
$ 13.03 
Options, Outstanding, Weighted Average Remaining Contractual Term
7 years 
 
 
Options, Outstanding, Intrinsic Value
$ 90.8 
 
 
Options, Vested and Expected to Vest, Outstanding, Number
11,108,466 
 
 
Options, Vested and Expected to Vest, Outstanding, Weighted Average Exercise Price
$ 12.24 
 
 
Options, Vested and Expected to Vest, Outstanding, Weighted Average Remaining Contractual Term
7 years 
 
 
Options, Vested and Expected to Vest, Outstanding, Aggregate Intrinsic Value
90.8 
 
 
Options, Vested and Expected to Vest, Exercisable, Number
5,493,802 
 
 
Options, Vested and Expected to Vest, Exercisable, Weighted Average Exercise Price
$ 12.31 
 
 
Options, Vested and Expected to Vest, Exercisable, Weighted Average Remaining Contractual Term
6 years 1 month 
 
 
Options, Vested and Expected to Vest, Exercisable, Aggregate Intrinsic Value
44.7 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract]
 
 
 
Options, Grants in Period, Weighted Average Grant Date Fair Value
$ 7.86 
$ 5.36 
$ 9.60 
Options, Exercises in Period, Intrinsic Value
10.0 
1.4 
16.2 
Proceeds from Stock Options Exercised
$ 14.0 
$ 2.8 
$ 14.4 
Share-based Compensation Valuation (Details)
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Schedule of Share-based Compensation Arrangements Valuation Inputs [Line Items]
 
 
 
Fair Value Assumptions, Weighted Average Expected Term
5 years 7 months 
5 years 5 months 
5 years 7 months 
Fair Value Assumptions, Expected Dividend Rate
0.00% 
0.00% 
0.00% 
Fair Value Assumptions, Risk Free Interest Rate, Minimum
1.73% 
1.00% 
1.34% 
Fair Value Assumptions, Risk Free Interest Rate, Maximum
2.13% 
1.90% 
1.92% 
Minimum [Member]
 
 
 
Schedule of Share-based Compensation Arrangements Valuation Inputs [Line Items]
 
 
 
Fair Value Assumptions, Weighted Average Volatility Rate
69.80% 
67.50% 
66.20% 
Maximum [Member]
 
 
 
Schedule of Share-based Compensation Arrangements Valuation Inputs [Line Items]
 
 
 
Fair Value Assumptions, Weighted Average Volatility Rate
71.70% 
71.90% 
67.40% 
Share-based Compensation Restricted Stock Awards (Details) (USD $)
In Millions, except Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures [Abstract]
 
 
 
Restricted stock award holder exercise price
$ 0 
 
 
RSAs
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
 
 
 
Nonvested, Number, period start
1,303,103 
811,480 
1,158,451 
Nonvested, Weighted Average Grant Date Fair Value, period start
$ 10.09 
$ 13.13 
$ 10.26 
Grants in Period
98,945 
968,652 
515,695 
Grants in Period, Weighted Average Grant Date Fair Value
$ 14.15 
$ 8.41 
$ 15.00 
Vested in Period
(514,613)
(296,831)
(721,990)
Vested in Period, Weighted Average Grant Date Fair Value
$ 10.23 
$ 12.76 
$ 10.11 
Forfeited in Period
(108,485)
(180,198)
(140,676)
Forfeitures, Weighted Average Grant Date Fair Value
$ 9.62 
$ 10.33 
$ 11.84 
Nonvested, Number, period end
778,950 
1,303,103 
811,480 
Nonvested, Weighted Average Grant Date Fair Value, period end
$ 10.59 
$ 10.09 
$ 13.13 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures [Abstract]
 
 
 
Vested in Period, Fair Value
$ 5.3 
$ 3.8 
$ 7.3 
Aggregate Intrinsic Value, Vested
$ 6.6 
$ 2.5 
$ 13.9 
Share-based Compensation Restricted Stock Units (Details) (RSUs, USD $)
In Millions, except Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
RSUs
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
 
 
 
Nonvested, Number, period start
1,166,569 
666,214 
462,322 
Nonvested, Weighted Average Grant Date Fair Value, period start
$ 10.16 
$ 13.49 
$ 11.12 
Grants in Period
1,378,273 
796,582 
422,492 
Grants in Period, Weighted Average Grant Date Fair Value
$ 12.13 
$ 8.17 
$ 14.75 
Vested in Period
(378,406)
(218,279)
(134,088)
Vested in Period, Weighted Average Grant Date Fair Value
$ 10.48 
$ 12.74 
$ 10.93 
Forfeited in Period
(251,261)
(77,948)
(84,512)
Forfeitures, Weighted Average Grant Date Fair Value
$ 11.11 
$ 10.99 
$ 10.86 
Nonvested, Number, period end
1,915,175 
1,166,569 
666,214 
Nonvested, Weighted Average Grant Date Fair Value, period end
$ 11.39 
$ 10.16 
$ 13.49 
Outstanding, Weighted Average Remaining Contractual Terms
1 year 5 months 
 
 
Aggregate Intrinsic Value, Nonvested
$ 38.8 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures [Abstract]
 
 
 
Vested in Period, Fair Value
4.0 
2.8 
1.5 
Aggregate Intrinsic Value, Vested
$ 4.7 
$ 2.1 
$ 1.8 
Share-based Compensation Performance Stock Units (Details) (Performance Shares [Member], USD $)
In Millions, except Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Performance Shares [Member]
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
 
 
 
Nonvested, Number, period start
200,255 
309,707 
431,238 
Nonvested, Weighted Average Grant Date Fair Value, period start
$ 9.49 
$ 9.48 
$ 8.91 
Grants in Period
0 
0 
118,209 
Grants in Period, Weighted Average Grant Date Fair Value
$ 0.00 
$ 0.00 
$ 11.19 
Vested in Period
0 
(30,037)
(83,380)
Vested in Period, Weighted Average Grant Date Fair Value
$ 0.00 
$ 9.49 
$ 9.48 
Forfeited in Period
(200,255)
(79,415)
(156,360)
Forfeitures, Weighted Average Grant Date Fair Value
$ 9.49 
$ 9.44 
$ 9.21 
Nonvested, Number, period end
0 
200,255 
309,707 
Nonvested, Weighted Average Grant Date Fair Value, period end
$ 0.00 
$ 9.49 
$ 9.48 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures [Abstract]
 
 
 
Vested in Period, Fair Value
$ 0 
$ 0.3 
$ 0.8 
Stockholders' Equity (Deficit) Public Offering (Details) (USD $)
In Thousands, except Share data in Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Equity [Abstract]
 
 
 
Shares, New Issues
11.5 
 
 
Stock Issued During Period Shares New Issues To Underwriter
1.5 
 
 
Sale of Stock, Price Per Share
$ 12.50 
 
 
Proceeds from issuance of common stock, net
$ 134,874 
$ 0 
$ 0 
Stockholders' Equity (Deficit) (Details) (USD $)
In Millions, except Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Stockholders' equity (deficit) (textual)
 
 
 
Number of shares of common stock issued as a result of stock option exercises
1,514,826 
413,248 
1,926,368 
Net proceeds from stock options exercised
$ 14.0 
$ 2.8 
$ 14.4 
Stock options
 
 
 
Stockholders' equity (deficit) (textual)
 
 
 
Number of shares of common stock issued as a result of stock option exercises
1,514,826 
413,248 
1,926,368 
Net proceeds from stock options exercised
14.0 
2.8 
14.4 
RSUs
 
 
 
Stockholders' equity (deficit) (textual)
 
 
 
Shares, Restricted Stock Award
281,398 
134,944 
82,069 
Number of RSUs surrendered to pay for minimum withholding taxes
97,008 
83,335 
52,019 
Payments for tax withholding for restricted stock units vested, net
$ 1.9 
$ 0.8 
$ 0.7 
Restricted stock awards
 
 
 
Stockholders' equity (deficit) (textual)
 
 
 
Shares, Restricted Stock Award
(9,540)
780,066 
375,019 
Commitments and Contingencies Operating Lease textual (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2017
sqft
Dec. 31, 2016
Office and Research Facility [Member]
 
 
Lessee, Lease, Description [Line Items]
 
 
Operating Leases, Area Leased
76,000 
 
Operating Leases, Base Rent, Periodic Increase, Percent
3.00% 
 
Deferred Rent Credit
$ 0.3 
$ 0.4 
Number of buildings
4 
 
Lease Expiration Date
Jan. 31, 2023 
 
Satellite office [Member]
 
 
Lessee, Lease, Description [Line Items]
 
 
Operating Leases, Area Leased
10,000 
 
Operating Leases, Base Rent, Periodic Increase, Percent
3.00% 
 
Deferred Rent Credit
$ 0.3 
$ 0.4 
Lease Expiration Date
Jan. 31, 2021 
 
Commitments and Contingencies Commitments and Contingencies (Details) (USD $)
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Commitments and Contingencies Disclosure [Abstract]
 
 
 
Operating Leases, Rent Expense, Net
$ 2,300,000 
$ 2,200,000 
$ 1,900,000 
2018
2,415,000 
 
 
2019
2,785,000 
 
 
2020
2,824,000 
 
 
2021
2,470,000 
 
 
2022
2,506,000 
 
 
2023
$ 13,000,000 
 
 
Commitments and Contingencies Other Commitments (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2017
Avid Commercial Supply Agreement [Member]
 
Long-term Purchase Commitment [Line Items]
 
Purchase Obligation
$ 7.2 
Patheon [Member]
 
Long-term Purchase Commitment [Line Items]
 
Purchase Obligation
$ 0.3 
Commitments and Contingencies Contingencies (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Commitments and Contingencies Disclosure [Abstract]
 
Period for Termination
90 days 
Contingent milestone payment
$ 8.0 
Income Taxes (Details) (USD $)
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Income Tax Disclosure [Abstract]
 
 
 
2017 Federal tax rate
35.00% 
 
 
2018 Federal tax rate
21.00% 
 
 
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Amount
$ 17,132,000 
$ 0 
$ 0 
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount
$ 17,100,000 
 
 
Income Taxes Net Income (Loss) By Region (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Income Tax Disclosure [Abstract]
 
 
 
United States
$ 160,938 
$ 6,384 
$ 11,724 
Foreign
(99,328)
(108,245)
(43,955)
Net Income (Loss) Before Income Taxes
$ 61,610 
$ (101,861)
$ (32,231)
Income Taxes Components Deferred Taxes (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2017
Dec. 31, 2016
Income Tax Disclosure [Abstract]
 
 
Deferred Tax Assets, Operating Loss Carryforwards
$ 32,630 
$ 103,296 
Deferred Tax Assets, Deferred Income
8,815 
15,354 
Deferred Tax Assets, Tax Credit Carryforwards, Research
75,224 
73,701 
Deferred Tax Assets, Tax Deferred Expense, Compensation and Benefits, Share-based Compensation Cost
7,423 
8,844 
Deferred Tax Assets, Tax Credit Carryforwards, Alternative Minimum Tax
5,532 
1,494 
Deferred Tax Assets, Other
2,270 
1,021 
Deferred Tax Assets, Gross
131,894 
203,710 
Deferred Tax Assets, Valuation Allowance
(126,189)
(203,370)
Deferred Tax Assets, Net of Valuation Allowance
5,705 
340 
Deferred Tax Liabilities, Property, Plant and Equipment
(173)
(340)
Deferred Tax Liabilities, Net, Noncurrent
(173)
(340)
Deferred Tax Assets, Net
$ 5,532 
$ 0 
Income Taxes Income Tax Expense (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Income Tax Disclosure [Abstract]
 
 
 
Current Federal Tax Expense (Benefit)
$ 4,051 
$ 1,145 
$ 0 
Current State Tax Expense
120 
17 
0 
Deferred Federal Income Tax Benefit
(5,532)
0 
0 
Deferred State Income Tax Expense
0 
0 
0 
Income tax (benefit) expense
$ (1,361)
$ 1,162 
$ 0 
Income Taxes Schedule of Income Tax Reconciliation (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Income Tax Disclosure [Abstract]
 
 
 
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent
34.00% 
34.00% 
34.00% 
Effective Income Tax Rate Reconciliation at Federal Statutory Income Tax Rate, Amount
$ 20,947 
$ (34,633)
$ (10,959)
Effective Income Tax Rate Reconciliation, State and Local Income Taxes, Amount
930 
(653)
5,524 
Effective Income Tax Rate Reconciliation, Change in Deferred Tax Assets Valuation Allowance, Amount
(77,181)
11,252 
4,045 
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Amount
17,132 
0 
0 
Effective Income Tax Rate Reconciliation, Foreign Income Tax Rate Differential, Amount
33,674 
36,803 
14,945 
Effective Income Tax Rate Reconciliation, Nondeductible Expense, Share-based Compensation Cost, Amount
525 
3,735 
(4,990)
Effective Income Tax Rate Reconciliation, Nondeductible Expense, Other, Amount
5,779 
698 
6,457 
Effective Income Tax Rate Reconciliation, Tax Credit, Research, Amount
4,162 
(1,084)
(3,861)
Effective Income Tax Rate Reconciliation, Deduction, Amount
(7,329)
(14,956)
(11,161)
Income Tax Expense (Benefit), Continuing Operations, Discontinued Operations
$ (1,361)
$ 1,162 
$ 0 
Income Taxes Unrecognized Tax Benefit (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Income Tax Disclosure [Abstract]
 
 
 
Unrecognized Tax Benefits, beginning of period
$ 12,799 
$ 4,898 
$ 0 
Increase Resulting from Prior Period Tax Positions
0 
5,615 
0 
Decrease Resulting from Prior Period Tax Positions
(2,518)
(4,898)
0 
Increase Resulting from Current Period Tax Positions
4,147 
7,184 
4,898 
Unrecognized Tax Benefits, end of period
$ 14,428 
$ 12,799 
$ 4,898 
Income Taxes Operating Loss Carryforward Expiration (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2017
Internal Revenue Service (IRS) [Member]
 
Operating Loss Carryforwards [Line Items]
 
Operating Loss Carryforwards
$ 88,516 
Internal Revenue Service (IRS) [Member] |
2018 expiration [Member]
 
Operating Loss Carryforwards [Line Items]
 
Operating Loss Carryforwards
0 
Internal Revenue Service (IRS) [Member] |
2021 and beyond expiration [Member]
 
Operating Loss Carryforwards [Line Items]
 
Operating Loss Carryforwards
88,516 
Internal Revenue Service (IRS) [Member] |
2028 and beyond expiration [Member]
 
Operating Loss Carryforwards [Line Items]
 
Operating Loss Carryforwards
0 
State and Local Jurisdiction [Member]
 
Operating Loss Carryforwards [Line Items]
 
Operating Loss Carryforwards
243,080 
State and Local Jurisdiction [Member] |
2018 expiration [Member]
 
Operating Loss Carryforwards [Line Items]
 
Operating Loss Carryforwards
0 
State and Local Jurisdiction [Member] |
2021 and beyond expiration [Member]
 
Operating Loss Carryforwards [Line Items]
 
Operating Loss Carryforwards
0 
State and Local Jurisdiction [Member] |
2028 and beyond expiration [Member]
 
Operating Loss Carryforwards [Line Items]
 
Operating Loss Carryforwards
$ 243,080 
Income Taxes Tax textuals (Details) (USD $)
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Tax Credit Carryforward [Line Items]
 
 
 
 
Deferred Tax Assets, Valuation Allowance
$ 126,189,000 
$ 203,370,000 
 
 
Unrecognized Tax Benefits
14,428,000 
12,799,000 
4,898,000 
0 
Unrecognized Tax Benefits that Would Impact Effective Tax Rate
0 
 
 
 
Unrecognized Tax Benefits that Would Impact Effective Tax Rate, no valuation allowance
14,400,000 
 
 
 
Unrecognized Tax Benefits, Income Tax Penalties and Interest Expense
0 
0 
0 
 
Undistributed Earnings of Foreign Subsidiaries
0 
0 
 
 
Deferred Foreign Tax Benefit
0 
 
 
 
Internal Revenue Service (IRS) [Member]
 
 
 
 
Tax Credit Carryforward [Line Items]
 
 
 
 
Operating Loss Carryforwards
88,516,000 
 
 
 
Internal Revenue Service (IRS) [Member] |
Research Tax Credit Carryforward [Member]
 
 
 
 
Tax Credit Carryforward [Line Items]
 
 
 
 
Tax Credit Carryforward, Amount
19,100,000 
 
 
 
Tax Credit Carryforward, Expiration Date
Dec. 31, 2024 
 
 
 
Internal Revenue Service (IRS) [Member] |
General Business Tax Credit Carryforward [Member]
 
 
 
 
Tax Credit Carryforward [Line Items]
 
 
 
 
Tax Credit Carryforward, Amount
57,300,000 
 
 
 
Tax Credit Carryforward, Expiration Date
Dec. 31, 2035 
 
 
 
State and Local Jurisdiction [Member]
 
 
 
 
Tax Credit Carryforward [Line Items]
 
 
 
 
Operating Loss Carryforwards
243,080,000 
 
 
 
State and Local Jurisdiction [Member] |
Research Tax Credit Carryforward [Member]
 
 
 
 
Tax Credit Carryforward [Line Items]
 
 
 
 
Tax Credit Carryforward, Amount
11,700,000 
 
 
 
Other state tax [Member]
 
 
 
 
Tax Credit Carryforward [Line Items]
 
 
 
 
Operating Loss Carryforwards
$ 13,900,000 
 
 
 
Employee Savings Plan (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Retirement Benefits [Abstract]
 
 
 
Employer Discretionary Contribution Amount
$ 1.2 
$ 1.0 
$ 0.7 
Summary of Unaudited Quarterly Financial Information Quarterly Financial Information Table (Details) (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2017
Sep. 30, 2017
Jun. 30, 2017
Mar. 31, 2017
Dec. 31, 2016
Sep. 30, 2016
Jun. 30, 2016
Mar. 31, 2016
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Quarterly Financial Information Disclosure [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Revenues
$ 189,564 1
$ 63,731 2
$ 33,750 
$ 29,568 
$ 39,003 
$ 31,853 
$ 33,336 
$ 42,499 
$ 316,613 
$ 146,691 
$ 135,057 
Gross Profit
5,105 
5,257 
4,992 
3,890 
5,420 
4,197 
5,391 
5,178 
 
 
 
Operating Expenses
63,635 
55,654 
59,228 
57,094 
61,578 
54,596 
55,059 
58,668 
 
 
 
Net income (loss)
$ 123,882 
$ 2,749 
$ (30,763)
$ (32,897)
$ (27,386)
$ (28,946)
$ (26,875)
$ (19,816)
$ 62,971 
$ (103,023)
$ (32,231)
Earnings Per Share, Basic
$ 0.87 
$ 0.02 
$ (0.23)
$ (0.26)
 
 
 
 
$ 0.46 
$ (0.81)
$ (0.25)
Earnings Per Share, Diluted
$ 0.85 
$ 0.02 
$ (0.23)
$ (0.26)
 
 
 
 
$ 0.45 
$ (0.81)
$ (0.25)
Weighted Average Number of Shares Outstanding, Basic
141,718 
141,190 
134,013 
128,615 
 
 
 
 
136,419 
127,964 
126,704 
Weighted Average Number of Shares Outstanding, Diluted
145,633 
143,236 
134,013 
128,615 
 
 
 
 
139,068 
127,964 
126,704 
Earnings Per Share, Basic and Diluted
 
 
 
 
$ (0.21)
$ (0.23)
$ (0.21)
$ (0.16)
 
 
 
Weighted Average Number of Shares Outstanding, Basic and Diluted
 
 
 
 
128,185 
128,154 
127,958 
127,615 
 
 
 
Summary of Unaudited Quarterly Financial Information Textuals (USD $)
In Millions, unless otherwise specified
3 Months Ended
Dec. 31, 2017
BMS [Member]
Dec. 31, 2017
Alexion [Member]
Dec. 31, 2017
Janssen [Member]
Sep. 30, 2017
Roche [Member]
Disaggregation of Revenue [Line Items]
 
 
 
 
Proceeds from Collaborator
$ 101.4 
$ 40.0 
$ 15.0 
$ 30.0 
Schedule II Valuation and Qualifying Accounts (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Valuation and Qualifying Accounts Disclosure [Line Items]
 
 
 
Accounts receivable allowance, beginning balance
$ 559 1
$ 967 1
$ 611 1
Valuation Allowances and Reserves, Additions for Charges to Cost and Expense
4,645 1
4,795 1
4,150 1
Valuation Allowances and Reserves, Deductions
(4,645)1
(5,203)1
(3,794)1
Accounts receivable allowance, ending balance
$ 559 1
$ 559 1
$ 967 1