Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Feb. 26, 2018 | Jun. 30, 2017 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | MEDICINES CO /DE | ||
Entity Central Index Key | 1,113,481 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2017 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2,017 | ||
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 | $ 2,417,163,772 | ||
Entity Common Stock, Shares Outstanding | 73,283,509 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 151,359 | $ 541,835 |
Accounts receivable, net of allowances of approximately $7.1 million and $2.9 million at December 31, 2017 and December 31, 2016, respectively | 3,496 | 18,171 |
Inventory, net | 5,559 | 28,486 |
Prepaid expenses and other current assets | 11,688 | 14,875 |
Current assets held for sale | 391,202 | 50,586 |
Total current assets | 563,304 | 653,953 |
Fixed assets, net | 17,254 | 30,961 |
In-process research & development | 0 | 65,000 |
Amortizable intangible assets, net | 0 | 257,185 |
Goodwill | 200,571 | 200,571 |
Restricted cash | 5,541 | 5,032 |
Contingent purchase price from sale of businesses | 80,700 | 143,700 |
Other assets | 5,613 | 715 |
Noncurrent assets held for sale | 0 | 348,094 |
Total assets | 872,983 | 1,705,211 |
Current liabilities: | ||
Accounts payable | 10,244 | 20,578 |
Accrued expenses | 95,197 | 66,838 |
Current portion of contingent purchase price | 4,995 | 0 |
Convertible senior notes | 0 | 53,749 |
Deferred revenue | 4,476 | 16,435 |
Current liabilities held for sale | 60,580 | 87,025 |
Total current liabilities | 175,492 | 244,625 |
Contingent purchase price | 14,655 | 31,832 |
Convertible senior notes | 649,198 | 623,584 |
Deferred tax liabilities | 0 | 89,992 |
Other liabilities | 8,724 | 11,705 |
Noncurrent liabilities held for sale | 0 | 50,457 |
Total liabilities | 848,069 | 1,052,195 |
Equity component of currently redeemable convertible senior notes (Note 9) | 0 | 1,033 |
Stockholders’ equity: | ||
Preferred stock, $1.00 par value per share, 5,000,000 shares authorized; no shares issued and outstanding | 0 | 0 |
Common stock, $0.001 par value per share, 187,500,000 authorized; 76,191,958 issued and 73,178,815 outstanding at December 31, 2017 and 73,212,545 issued and 71,019,563 outstanding at December 31, 2016 | 76 | 73 |
Additional paid-in capital | 1,377,393 | 1,256,890 |
Treasury stock, at cost; 3,013,143 and 2,192,982 shares at December 31, 2017 and December 31, 2016, respectively | (90,016) | (50,000) |
Accumulated deficit | (1,257,356) | (548,983) |
Accumulated other comprehensive loss | (5,183) | (5,479) |
Total The Medicines Company stockholders’ equity | 24,914 | 652,501 |
Non-controlling interest in joint venture | 0 | (518) |
Total stockholders’ equity | 24,914 | 651,983 |
Total liabilities and stockholders’ equity | 872,983 | 1,705,211 |
In-process research and development [Member] | ||
Current assets: | ||
In-process research & development | 0 | 65,000 |
Product licenses [Member] | ||
Current assets: | ||
Amortizable intangible assets, net | 0 | 26,987 |
Developed product rights [Member] | ||
Current assets: | ||
Amortizable intangible assets, net | $ 0 | $ 230,198 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Accounts receivable allowances | $ 7.1 | $ 2.9 |
Stockholders’ equity: | ||
Preferred stock, par value (usd per share) | $ 1 | $ 1 |
Preferred stock, authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Common stock, par value (usd per share) | $ 0.001 | $ 0.001 |
Common stock, authorized (in shares) | 187,500,000 | 187,500,000 |
Common stock, issued (in shares) | 76,191,958 | 73,212,545 |
Common stock, outstanding (in shares) | 73,178,815 | 71,019,563 |
Treasury stock (in shares) | 3,013,143 | 2,192,982 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Statement [Abstract] | |||
Net product revenues | $ 18,980 | $ 71,956 | $ 240,688 |
Royalty revenues | 25,809 | 71,205 | 53,859 |
Total net revenues | 44,789 | 143,161 | 294,547 |
Operating expenses: | |||
Cost of product revenues | 47,193 | 60,653 | 103,986 |
Asset impairment charges | 392,097 | 0 | 0 |
Research and development | 138,370 | 92,107 | 90,388 |
Selling, general and administrative | 132,225 | 212,482 | 285,300 |
Total operating expenses | 709,885 | 365,242 | 479,674 |
Loss from operations | (665,096) | (222,081) | (185,127) |
Legal settlement | 0 | 0 | 5,000 |
Co-promotion and license income | 7,549 | 3,854 | 10,132 |
Gain on remeasurement of equity investment | 0 | 0 | 22,597 |
Gain on sale of investment | 0 | 0 | 19,773 |
Gain on sale of assets | 0 | 288,301 | 0 |
Loss on extinguishment of debt | 0 | (5,380) | 0 |
Interest expense | (48,564) | (44,463) | (37,092) |
Other income | 1,840 | 346 | 188 |
(Loss) income from continuing operations before income taxes | (704,271) | 20,577 | (164,529) |
Benefit from (provision for) income taxes | 96,576 | (67) | 29,733 |
(Loss) income from continuing operations | (607,695) | 20,510 | (134,796) |
Loss from discontinued operations, net of tax | (100,678) | (139,682) | (217,950) |
Net loss | (708,373) | (119,172) | (352,746) |
Net loss (income) attributable to non-controlling interest | 0 | 54 | (10) |
Net loss attributable to The Medicines Company | (708,373) | (119,118) | (352,756) |
Amounts attributable to The Medicines Company: | |||
(Loss) income from continuing operations | (607,695) | 20,564 | (134,806) |
Loss from discontinued operations, net of tax | (100,678) | (139,682) | (217,950) |
Net loss attributable to The Medicines Company | $ (708,373) | $ (119,118) | $ (352,756) |
Basic (loss) earnings per common share attributable to The Medicines Company: | |||
(Loss) earnings from continuing operations (usd per share) | $ (8.40) | $ 0.29 | $ (2.02) |
Loss from discontinued operations (usd per share) | (1.39) | (2) | (3.26) |
Basic loss per share (usd per share) | (9.79) | (1.71) | (5.28) |
Diluted (loss) earnings per common share attributable to The Medicines Company: | |||
(Loss) earnings from continuing operations (usd per share) | (8.40) | 0.28 | (2.02) |
Loss from discontinued operations (usd per share) | (1.39) | (1.91) | (3.26) |
Diluted loss per share (usd per share) | $ (9.79) | $ (1.63) | $ (5.28) |
Weighted average number of common shares outstanding: | |||
Basic (shares) | 72,356 | 69,909 | 66,809 |
Diluted (shares) | 72,356 | 73,022 | 66,809 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | |||
Net loss | $ (708,373) | $ (119,172) | $ (352,746) |
Other comprehensive income (loss): | |||
Foreign currency translation adjustment | 296 | 213 | 1,445 |
Amounts reclassified from accumulated other comprehensive income | 0 | (9,665) | 0 |
Other comprehensive income (loss) | 296 | (9,452) | 1,445 |
Comprehensive loss | (708,077) | (128,624) | (351,301) |
Less: comprehensive loss (income) attributable to non-controlling interest | 0 | 54 | (10) |
Comprehensive loss attributable to The Medicines Company | $ (708,077) | $ (128,570) | $ (351,311) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock [Member] | Treasury Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Accumulated Comprehensive (Loss) Income [Member] | Noncontrolling Interest in JV [Member] |
Balance (in shares) at Dec. 31, 2014 | 67,667,000 | 2,193,000 | |||||
Balance at Dec. 31, 2014 | $ 920,091 | $ 68 | $ (50,000) | $ 1,045,078 | $ (77,109) | $ 2,528 | $ (474) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Employee stock purchase (in shares) | 2,989,324 | 2,989,000 | |||||
Employee stock purchases | $ 65,238 | $ 3 | 65,235 | ||||
Issuance of restricted stock awards (in shares) | 166,042 | 166,000 | |||||
Issuance of restricted stock awards | $ 0 | ||||||
Issuance of common stock (in shares) | 945,000 | ||||||
Issuance of common stock | 29,964 | $ 1 | 29,963 | ||||
Non-cash stock compensation | 30,605 | 30,605 | |||||
Equity component of the convertible notes issuance, net | 37,177 | 37,177 | |||||
Net loss | (352,746) | (352,756) | 10 | ||||
Currency translation adjustment | 1,445 | 1,445 | |||||
Amounts reclassified from accumulated other comprehensive income | 0 | ||||||
Balance (in shares) at Dec. 31, 2015 | 71,767,000 | 2,193,000 | |||||
Balance at Dec. 31, 2015 | $ 731,774 | $ 72 | $ (50,000) | 1,208,058 | (429,865) | 3,973 | (464) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Employee stock purchase (in shares) | 1,312,812 | 1,313,000 | |||||
Employee stock purchases | $ 33,776 | $ 1 | 33,775 | ||||
Issuance of restricted stock awards (in shares) | 132,344 | 132,000 | |||||
Issuance of restricted stock awards | $ 0 | ||||||
Non-cash stock compensation | 30,987 | 30,987 | |||||
Reclassification from mezzanine equity | 16,056 | 16,056 | |||||
Equity component of 2017 Notes repurchased | (108,725) | (108,725) | |||||
Purchase of capped call transactions | (33,931) | (33,931) | |||||
Equity component of the convertible notes issuance, net | 98,085 | 98,085 | |||||
Settlement of hedges | (87,874) | (87,874) | |||||
Settlement of warrants | 100,459 | 100,459 | |||||
Net loss | (119,172) | (119,118) | (54) | ||||
Currency translation adjustment | 213 | 213 | |||||
Amounts reclassified from accumulated other comprehensive income | (9,665) | (9,665) | |||||
Balance (in shares) at Dec. 31, 2016 | 73,212,000 | 2,193,000 | |||||
Balance at Dec. 31, 2016 | $ 651,983 | $ 73 | $ (50,000) | 1,256,890 | (548,983) | (5,479) | (518) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Employee stock purchase (in shares) | 1,949,117 | 1,949,000 | |||||
Employee stock purchases | $ 48,621 | $ 2 | 48,619 | ||||
Purchase of shares from non-controlling interest | $ (167) | (685) | 518 | ||||
Issuance of restricted stock awards (in shares) | 166,103 | 166,000 | |||||
Issuance of restricted stock awards | $ 0 | ||||||
Non-cash stock compensation | 31,520 | 31,520 | |||||
Equity component of 2017 Notes repurchased | 3 | 3 | |||||
Equity component of the convertible notes issuance, net | 1,031 | 1,031 | |||||
Settlement of 2017 Notes (in shares) | (820,000) | ||||||
Settlement of 2017 Notes | 1 | $ 1 | |||||
Settlement of hedges (in shares) | (820,000) | ||||||
Settlement of hedges | (1) | $ (40,016) | 40,015 | ||||
Settlement of warrants (in shares) | 44,000 | ||||||
Settlement of warrants | 0 | ||||||
Net loss | (708,373) | (708,373) | |||||
Currency translation adjustment | 296 | 296 | |||||
Amounts reclassified from accumulated other comprehensive income | 0 | ||||||
Balance (in shares) at Dec. 31, 2017 | 76,191,000 | 3,013,000 | |||||
Balance at Dec. 31, 2017 | $ 24,914 | $ 76 | $ (90,016) | $ 1,377,393 | $ (1,257,356) | $ (5,183) | $ 0 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Cash flows from operating activities: | |||
Net loss | $ (708,373) | $ (119,172) | $ (352,746) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Depreciation and amortization | 21,974 | 31,042 | 34,837 |
Asset impairment charges | 392,097 | 0 | 29,413 |
Impairment on divestiture | 0 | 0 | 133,273 |
Amortization of debt discount | 26,868 | 26,182 | 23,676 |
Unrealized foreign currency transaction losses (gains), net | 2,180 | (941) | (173) |
Stock compensation expense | 31,520 | 30,987 | 30,605 |
Loss on disposal of fixed assets | 105 | 521 | 543 |
Deferred tax benefit | (89,895) | (23) | (53,292) |
Extinguishment of debt | 0 | 5,380 | 0 |
Gain on sale of businesses | 0 | (289,305) | 0 |
Gain on sale of investment | 0 | 0 | (19,773) |
Gain on remeasurement of equity investment | 0 | 0 | (22,597) |
Reserve for excess or obsolete inventory | 17,453 | 8,533 | 42,599 |
Changes in contingent purchase price | (18,787) | 23,981 | 20,278 |
Changes in operating assets and liabilities: | |||
Accounts receivable | 9,180 | 30,144 | 103,100 |
Inventory, net | 6,511 | (15,653) | (69,318) |
Prepaid expenses and other assets | 534 | 569 | (5,286) |
Accounts payable | (17,222) | (7,398) | 16,362 |
Accrued expenses | 31,526 | (37,233) | (39,501) |
Deferred revenue | (13,757) | 1,568 | 8,386 |
Payments on contingent purchase price | (52,543) | (1,045) | (78,900) |
Other liabilities | (7,659) | (11,446) | 549 |
Net cash used in operating activities | (368,288) | (323,309) | (197,965) |
Cash flows from investing activities: | |||
Purchases of available for sale securities | (131,560) | 0 | |
Proceeds from sale of fixed assets | 0 | 0 | 250 |
Proceeds from sale of investment | 0 | 0 | 19,773 |
Proceeds from maturities and sales of available for sale securities | 131,535 | 0 | |
Purchases of fixed assets | (4,525) | (2,176) | (2,555) |
Payments for intangible assets | 0 | (10,000) | (112,617) |
Acquisition of business, net of cash acquired | 0 | 0 | (28,397) |
Proceeds from sale of businesses | 0 | 437,875 | 0 |
Change in restricted cash | (478) | (3,656) | 35 |
Net cash (used in) provided by investing activities | (5,028) | 422,043 | (123,511) |
Cash flows from financing activities: | |||
Proceeds from issuances of common stock, net | 48,621 | 33,776 | 95,198 |
Payments on contingent purchase price | (10,523) | (9,404) | (157,601) |
Proceeds from the issuance of convertible senior notes | 0 | 402,500 | 400,000 |
Repayments of convertible senior notes | (55,000) | (323,225) | 0 |
Purchase of capped call transactions related to convertible senior notes | 0 | (33,931) | 0 |
Proceeds from settlement of bond hedges related to convertible senior notes | 0 | 100,459 | 0 |
Settlement of warrants | (2) | (87,874) | 0 |
Debt and equity issuance costs | 0 | (11,725) | (12,769) |
Purchase of shares of non-controlling interest | (167) | 0 | 0 |
Net cash (used in) provided by financing activities | (17,071) | 70,576 | 324,828 |
Effect of exchange rate changes on cash | (89) | (648) | (920) |
(Decrease) increase in cash and cash equivalents | (390,476) | 168,662 | 2,432 |
Cash and cash equivalents at beginning of period | 541,835 | 373,173 | 370,741 |
Cash and cash equivalents at end of period | 151,359 | 541,835 | 373,173 |
Supplemental disclosure of cash flow information: | |||
Interest paid | 22,561 | 12,269 | 8,837 |
Taxes paid | 575 | 36 | 114 |
Non-cash investing and financing activities | |||
Issuance of common stock upon conversion of convertible notes | 32,018 | 0 | 0 |
Receipt of common stock upon settlement of 2017 Note hedge | 40,015 | 0 | 0 |
Issuance of common stock upon the exercise of the 2017 Warrants | $ 1,638 | $ 0 | $ 0 |
Nature of Business
Nature of Business | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Business | Nature of Business The Medicines Company (the Company) is a biopharmaceutical company driven by an overriding purpose - to save lives, alleviate suffering and contribute to the economics of healthcare. The Company’s goal is to create transformational solutions to address the most pressing healthcare needs facing patients, physicians and providers in cardiovascular care. The Company is focused on inclisiran, an investigational agent which is potentially a first-in-class lipid-lowering drug, to reduce LDL-cholesterol (LDL-C), which is commonly referred to as “bad” cholesterol, in patients with atherosclerotic cardiovascular disease (ASCVD) or cardiovascular risk-equivalents. The Company believes that inclisiran possesses favorable attributes that competitive products do not possess, would satisfy unmet medical needs and has the potential to improve the economics of healthcare. The Company has the right to develop, manufacture and commercialize inclisiran under its collaboration agreement with Alnylam Pharmaceuticals, Inc. (Alnylam). In addition, the Company markets Angiomax® (bivalirudin) in the United States primarily through a supply and distribution agreement with Sandoz Inc. (Sandoz), under which the Company granted Sandoz the exclusive right to sell in the United States an authorized generic of Angiomax. On November 3, 2015, the Company announced that it was in the process of evaluating its operations with a goal of unlocking stockholder value. In particular, the Company stated its current intention was to explore strategies for optimizing its capital structure and liquidity position and to narrow the Company’s operational focus by strategically separating non-core businesses and products in order to generate non-dilutive cash and reduce associated cash burn and capital requirements. On February 1, 2016, the Company completed the sale of its hemostasis portfolio, consisting of PreveLeak (surgical sealant), Raplixa (fibrin sealant) and Recothrom Thrombin topical (Recombinant) (the Hemostasis Business), to wholly owned subsidiaries of Mallinckrodt plc (collectively, Mallinckrodt) pursuant to the purchase and sale agreement dated December 18, 2015 between the Company and Mallinckrodt. At completion of the sale, the Company received approximately $174.1 million in cash from Mallinckrodt, and may receive up to an additional $235.0 million in the aggregate following the achievement of certain specified calendar year net sales milestones with respect to net sales of PreveLeak and Raplixa. As a result of the transaction, the Company accounted for the assets and liabilities of the Hemostasis Business as held for sale at December 31, 2015. As a result of the classification as held for sale, the Company recorded impairment charges of $133.3 million , including $24.5 million related to goodwill, to reduce the Hemostasis Business disposal group’s carrying value to its estimated fair value, less costs to sell for the year ended December 31, 2015. Further, the financial results of the Hemostasis Business held for sale were reclassified to discontinued operations for all periods presented in our consolidated financial statements. See Note 23 “Discontinued Operations” for further details. On June 21, 2016, the Company completed the sale of three non-core cardiovascular products, Cleviprex (clevidipine) injectable emulsion, Kengreal (cangrelor) and rights to Argatroban for Injection (collectively the Non-Core ACC Products) and related assets, to Chiesi USA, Inc. (Chiesi USA) and its parent company Chiesi Farmaceutici S.p.A. (Chiesi) pursuant to the purchase and sale agreement dated May 9, 2016 by and among the Company, Chiesi and Chiesi USA. At the completion of the sale, the Company received approximately $263.8 million in cash, which included the value of product inventory, and may receive up to an additional $480.0 million in the aggregate following the achievement of certain specified calendar year net sales milestones with respect to net sales of each of Cleviprex and Kengreal. As part of the transaction, we sublicensed to Chiesi all of our rights to Cleviprex and Kengreal under our license from AstraZeneca. Subsequent to the completion of the sale, these sublicenses from us to Chiesi were terminated, Chiesi purchased from AstraZeneca all or substantially all of AstraZeneca’s assets relating to Cleviprex and Kengreal, we and Chiesi released certain claims against one another, and we paid Chiesi $7.5 million . See Note 22, “Dispositions,” for further details. Consistent with the Company’s intentions announced in November 2015, in January 2017 the Company announced that it was seeking opportunities to partner or divest Ionsys and is exploring alternatives for monetizing, in whole or in part, the Company’s infectious disease business. Although the Company continues to seek a partnership or divestiture transaction for Ionsys, in June 2017 the Company commenced a voluntary discontinuation and withdrawal of Ionsys from the market and ceased related commercialization activities, with the regulatory authorizations for Ionsys remaining open. Concurrent with this market withdrawal, the Company commenced implementation of a workforce reduction, which resulted in the reduction of 57 employees, representing approximately 15% of the Company’s workforce at that time. In the second quarter of 2017, the Company recorded a pre-tax charge of approximately $276.9 million associated with the discontinuation and market withdrawal of Ionsys in the United States market, of which $268.1 million was a non-cash impairment charge (including a write-off of inventory of $5.3 million ) and $8.8 million relates to cash severance and other exit costs. The non-cash impairment charge includes $11.4 million to reduce the carrying amount of the fixed assets associated with Ionsys to an estimated fair value of zero . The Company has also discontinued and withdrawn Ionsys in the European market. Until October 2017, the Company had an exclusive license with SymBio Pharmaceuticals Ltd. (SymBio) to develop and commercialize Ionsys in Japan. That agreement terminated in connection with a legal dispute with SymBio, as described in Part I, Item 3. Legal Proceedings of this Annual Report on Form 10-K. In August 2017, the Company announced that it discontinued the clinical development program for MDCO-700, an investigational anesthetic agent. In connection with this decision, the Company’s consolidated statement of operations for the year ended December 31, 2017 includes the following non-cash adjustments that were recorded during the second quarter of 2017: $65.0 million of asset impairment charges to in-process research and development (IPR&D) acquired from Annovation BioPharma, Inc. (Annovation), a $14.7 million decrease in the carrying value of the contingent purchase price to an estimated fair value of zero , and a $23.0 million benefit for income taxes due to a reduction in the Company’s recorded valuation allowance against its deferred tax assets as a result of the impairment charge. On January 5, 2018, the Company completed the sale of its infectious disease business, consisting of the products Vabomere, Orbactiv and Minocin IV and line extensions thereof, and substantially all of the assets related thereto, other than certain pre-clinical assets, to Melinta Therapeutics, Inc. (Melinta) pursuant to a purchase and sale agreement dated November 28, 2017 between the Company and Melinta. At the completion of the sale, the Company received approximately $166.4 million and 3,313,702 shares of Melinta common stock having a market value, based on Melinta's closing share price on January 5, 2018, of approximately $54.5 million . In addition, the Company is entitled to receive (i) a cash payment payable 12 months following the closing of the Transaction equal to $25.0 million ; (ii) a cash payment payable 18 months following the closing of the Transaction equal to $25.0 million ; and (iii) tiered royalty payments of 5% to 25% on worldwide net sales of (a) Vabomere and (b) Orbactiv and Minocin IV, collectively. As a result of the transaction, the Company accounted for the assets and liabilities of the infectious disease business that were sold as held for sale at December 31, 2016. Further, the financial results of the infectious disease business held for sale were reclassified to discontinued operations for all periods presented in the consolidated financial statements. See Note 23 “Discontinued Operations” for further details. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (U.S. GAAP). Any reference in these notes to applicable guidance is meant to refer to the authoritative U.S. GAAP as found in the Accounting Standards Codification (ASC) and Accounting Standards Updates (ASU) of the Financial Accounting Standards Board (FASB). The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. The Company records net income (loss) attributable to non-controlling interest in the Company’s consolidated financial statements equal to percentage of ownership interest retained in the respective operations by the non-controlling parties. The Company has no unconsolidated subsidiaries. Going Concern Due to the introduction of generic competition against Angiomax and the divestiture of certain of the Company’s non-core products, the Company’s revenues generated from product sales have declined significantly since 2014. Revenues are expected to continue to decline as generic competition for Angiomax increases. The Company has incurred net losses and negative cash flows from operations since 2014 and had an accumulated deficit of $1.3 billion as of December 31, 2017 . The Company expects to incur significant expenses and operating losses for the foreseeable future as it continues to develop, seek regulatory approval for and commercially launch inclisiran. As a result of the completion of the sale of the Company’s infectious disease business on January 5, 2018, the Company believes that its existing cash and cash equivalents of approximately $151.4 million as of December 31, 2017 , together with the cash flows it expects to generate from product sales and royalties and the proceeds received from Melinta at the closing of the sale of the infectious disease business, will be sufficient to satisfy its anticipated operating and other funding requirements for the next twelve months from March 1, 2018 (the date of filing this Form 10-K). Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, costs, expenses and accumulated other comprehensive income/(loss) that are reported in the consolidated financial statements and accompanying disclosures. Actual results may be different. Investments The Company accounts for its common stock investment in a minority interest of a company that does not have a readily determinable fair value over which it does not exercise significant influence on the cost method. Under the cost method, an investment is carried at cost until it is sold or there is evidence that changes in the business environment or other facts and circumstances suggest it may be other than temporarily impaired. Investments in which the Company has at least a 20%, but not more than a 50%, interest are generally accounted for under the equity method. These non-marketable securities have been classified as investments and included in other assets on the accompanying consolidated balance sheets. The Company’s proportionate share of the operating results is recorded as loss in equity investment in the Company’s consolidated statement of operations. On February 2, 2015, the Company completed the acquisition of Annovation, and Annovation became the Company’s wholly owned subsidiary. See Note 6 “Acquisition” for further details. Inventory The Company records inventory upon the transfer of title from the Company’s vendors. Inventory is stated at the lower of cost or net realizable value and valued using first-in, first-out methodology. Angiomax and Ionsys bulk substances are classified as raw materials and their costs are determined using acquisition costs from the Company’s contract manufacturers. The Company records work-in-progress costs of filling, finishing and packaging against specific product batches. Fixed Assets Fixed assets are stated at cost. Depreciation is provided using the straight-line method based on estimated useful lives or, in the case of leasehold improvements, over the lesser of the useful lives or the lease terms. Repairs and maintenance costs are expensed as incurred. Treasury Stock Treasury stock is recognized at the cost to reacquire the shares. Shares issued from treasury are recognized utilizing the first-in first-out method. Intangible Assets with Definite Useful Lives Intangible assets with definite useful lives are amortized over their estimated useful lives and reviewed for impairment if certain events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. In-Process Research and Development The cost of in-process research and development (IPR&D) acquired directly in a transaction other than a business combination is capitalized if the projects have an alternative future use; otherwise it is expensed. The fair values of IPR&D projects acquired in business combinations are capitalized. Several methods may be used to determine the estimated fair value of the IPR&D acquired in a business combination. The Company utilizes the “income method,” which applies a probability weighting that considers the risk of development and commercialization to the estimated future net cash flows that are derived from projected sales revenues and estimated costs. These projections are based on factors such as relevant market size, patent protection, historical pricing of similar products and expected industry trends. The estimated future net cash flows are then discounted to the present value using an appropriate discount rate. This analysis is performed for each project independently. The Company also considers qualitative factors such as development of competing drugs, status in the development cycle of the product, regulatory developments and other qualitative factors. These assets are treated as indefinite-lived intangible assets until completion or abandonment of the projects, at which time the assets are amortized over the remaining useful life or written off, as appropriate. These are tested at least annually or when a triggering event occurs that could indicate a potential impairment. In August 2017, the Company announced that it discontinued the clinical development program for MDCO-700. In connection with this decision, the Company recorded impairment charges of $65.0 million related to IPR&D acquired from Annovation. Goodwill Goodwill represents the excess consideration in a business combination over the fair value of identifiable net assets acquired. Goodwill is not amortized, but subject to impairment testing at least annually or when a triggering event occurs that could indicate a potential impairment. The Company determines whether goodwill may be impaired by comparing the carrying value of its reporting unit to the fair value of its reporting unit. A reporting unit is defined as an operating segment or one level below an operating segment. Based on the Company’s evaluation, goodwill was not impaired as of December 31, 2017 . Contingent Purchase Price From Sale of Business The Company has contingent assets for certain specified calendar year net sales milestones as part of the sales of the Hemostasis Business and the Non-Core ACC Products. In determining the fair value of these sales milestones, considerable judgment is required to interpret the market data used to develop the assumptions and estimates. The Company utilizes either the “income method” or a risk adjusted revenue simulation model. The income method applies a probability weighting that considers the estimated future net sales of each of the respective products to determine the probability that each sale milestone will be met. These projections were based on factors such as relevant market size, patent protection, historical pricing of similar products and expected industry trends. In a risk adjusted revenue simulation model, the chances of achieving many different revenue levels are estimated and then adjusted to reflect the results of similar products and companies in the market to calculate the fair value of each milestone payment. The breadth of all possible revenue scenarios is captured in an estimate of revenue volatility - a measure that can be estimated from performance of similar companies in the market. The Company estimated revenue volatility as the delivered asset volatility observed in comparable companies’ historical performance, where the delivering asset was based on operational leverage of the Company. Under each of these possible scenarios, different amounts of the sales-based milestone payments are calculated, and the average of the payments across a range of possible scenarios is deemed to be the expected value of the earn-out payments. The Company will recognize any increases in the carrying amount or impairments of the contingent purchase price if and when the milestones are achieved or determined to have no value. In the fourth quarter of 2017, the Company decreased the carrying value of the contingent purchase price from the sale of the Hemostasis Business by $63.0 million to an estimated fair value of zero, which is a Level 3 fair value measurement, as a result of the discontinuation of Raplixa by Mallinckrodt. The Company noted no indicators of impairment on the carrying amounts of the remaining contingent assets. In addition, the Company determined that the fair values of these contingent payments to be received from the buyers are not readily determinable at December 31, 2017, as the estimated future net sales of each of the respective products are determined by the future actions of the buyers. Long-Lived Assets Long-lived assets, such as property, plant and equipment and certain other long-term assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset or asset group to the estimated undiscounted future cash flows expected to be generated by the asset or asset group. If the carrying amount of the assets exceed their estimated future undiscounted net cash flows, an impairment charge is recognized for the amount by which the carrying amount of the assets exceed the fair value of the assets. Contingent Purchase Price from Business Combinations Subsequent to the acquisition date, the Company measures the fair value of the acquisition-related contingent consideration at each reporting period, with changes in fair value recorded in selling, general and administrative in the accompanying consolidated statements of operations. Changes to contingent consideration obligations can result from adjustments to discount rates and periods, updates in the assumed achievement or timing of any development or commercial milestone or changes in the probability of certain clinical events, the passage of time and changes in the assumed probability associated with regulatory approval. The fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 measurement as defined in fair value measurement accounting. Risks and Uncertainties The Company is subject to risks common to companies in the pharmaceutical industry including, but not limited to, uncertainties related to commercialization of products, regulatory approvals, dependence on key products, dependence on key customers and suppliers, and protection of intellectual property rights. Concentrations of Credit Risk Financial instruments that potentially subject the Company to concentration of credit risk include cash, cash equivalents and accounts receivable. The Company believes it minimizes its exposure to potential concentrations of credit risk by placing investments with high quality institutions. At December 31, 2017 and 2016 , approximately $12.1 million and $56.1 million , respectively, of the Company’s cash and cash equivalents was invested in a single fund, the Dreyfus Cash Management Money Market Fund, a no-load money market fund with Capital Advisors Group. The Company currently sells branded Angiomax in the United States to a sole source distributor, Integrated Commercialization Solutions, Inc. (ICS). ICS accounted for 5% , 48% and 87% of the Company’s net product revenues for 2017 , 2016 and 2015 , respectively. At December 31, 2017 and 2016 , amounts due from ICS represented approximately $2.9 million and $2.2 million , or 27% and 11% , of gross accounts receivable, respectively. Product sales to Sandoz accounted for 55% and 23% of the Company’s net product revenues for 2017 and 2016 , respectively. At December 31, 2017 and 2016 , amounts due from Sandoz related to product sales were approximately $0.9 million or 8% and $5.6 million or 27% , respectively, of gross accounts receivable. At December 31, 2017 and 2016 , amounts due from Sandoz related to royalty revenues were approximately $4.2 million or 40% and $9.1 million or 43% , respectively, of gross accounts receivable. Contingencies The Company may be, from time to time, a party to various disputes and claims arising from normal business activities. The Company continually assesses litigation to determine if an unfavorable outcome would lead to a probable loss or reasonably possible loss which could be estimated. In accordance with the guidance of the FASB on accounting for contingencies, the Company accrues for all contingencies at the earliest date at which the Company deems it probable that a liability has been incurred and the amount of such liability can be reasonably estimated. If the estimate of a probable loss is a range and no amount within the range is more likely than another, the Company accrues the minimum of the range. In the cases where the Company believes that a reasonably possible loss exists, the Company discloses the facts and circumstances of the litigation, including an estimable range, if possible. Revenue Recognition Product Sales. The Company distributes branded Angiomax in the United States through a sole source distribution model with Integrated Commercialization Solutions (ICS). The Company sold Cleviprex, Kengreal and ready-to-use Argatroban and Minocin, Orbactiv and Vabomere under this model up until the sale of these products to Chiesi and Melinta, respectively. See Note 22, “Dispositions,” for further details regarding the products sold to Chiesi and Note 23, “Discontinued Operations,” for further details regarding the products sold to Melinta. ICS then primarily sells branded Angiomax, and previously sold the other product, to a limited number of national medical and pharmaceutical wholesalers with distribution centers located throughout the United States. Prior to July 1, 2015, sales of Angiomax in the United States were recognized upon shipment to ICS. As a result of the entrance of generic products in the marketplace beginning in the third quarter of 2015, the Company could not reasonably estimate its chargebacks with respect to branded Angiomax between July 1, 2015 and August 30, 2017, and sales of branded Angiomax in the United States were recognized under a deferred revenue model during that period. Under the deferred revenue model, the Company did not recognize revenue upon product shipment of branded Angiomax to ICS. Instead, upon product shipment, the Company invoiced ICS, recorded deferred revenue at gross invoice sales price, classified the cost basis of the product held by ICS as finished goods inventory held by others and included such cost basis amount within prepaid expenses and other current assets on the consolidated balance sheets. The Company recognized revenue when hospitals purchased the products and the transaction consideration became fixed or determinable. Beginning September 1, 2017, the Company had sufficient market information to reasonably estimate its chargebacks, returns and other adjustments to gross revenues associated with branded Angiomax and recognizes sales upon shipment to ICS. This change in estimate did not materially impact net product revenues or cost of product revenues for the year ended December 31, 2017, and is not expected to materially impact net product revenues or costs of product revenues in future periods. Effective July 2, 2015, the Company entered into a supply and distribution agreement with Sandoz under which it has granted Sandoz the exclusive right to sell in the United States an authorized generic of Angiomax (bivalirudin). The Company recognizes sales of generic Angiomax to Sandoz under a deferred revenue model. In accordance with the Sandoz agreement, the Company receives a royalty based on Sandoz’s gross margin, as defined in the agreement, of the authorized generic product sold by Sandoz to hospitals. The Company recognizes royalty revenue on an accrual basis in the period it is reported by Sandoz. During 2017 and 2016 , the Company recognized royalty revenue of $25.8 million and $71.2 million , respectively. The Company’s agreement with ICS provides that ICS will be the Company’s exclusive distributor of branded Angiomax and acute care generic products in the United States. Under the terms of this fee-for-service agreement, ICS places orders with the Company for sufficient quantities to maintain an appropriate level of inventory based on the Company’s customers’ historical purchase volumes. ICS assumes all credit and inventory risks, is subject to the Company’s standard return policy and has sole responsibility for determining the prices at which it sells these products, subject to specified limitations in the agreement. The agreement terminates on February 28, 2019 and will automatically renew for additional one -year periods unless either party gives notice at least 90 days prior to the automatic extension. Either party may terminate the agreement at any time and for any reason upon 180 days’ prior written notice to the other party. In Europe, the Company markets and sells Angiomax, which the Company markets under the trade name Angiox. The Company recognizes revenue from such sales when hospitals purchase the product. The Company had deferred revenue of $0.2 million and $1.7 million as of December 31, 2017 and 2016 , respectively, associated with sales of Angiomax to wholesalers outside of the United States. The Company does not recognize revenue from product sales until there is persuasive evidence of an arrangement, delivery has occurred, the price is fixed or determinable, the buyer is obligated to pay the Company, the obligation to pay is not contingent on resale of the product, the buyer has economic substance apart from the Company, the Company has no obligation to bring about the sale of the product, the amount of returns can be reasonably estimated and collectability is reasonably assured. The Company records allowances for chargebacks and other discounts or accruals for product returns, rebates and fee-for-service charges at the time of sale, and reports revenue net of such amounts. In determining the amounts of certain allowances and accruals, the Company must make significant judgments and estimates. For example, in determining these amounts, the Company estimates hospital demand, buying patterns by hospitals and group purchasing organizations from wholesalers and the levels of inventory held by wholesalers and by ICS. Making these determinations involves estimating whether trends in past wholesaler and hospital buying patterns will predict future product sales. The Company receives data periodically from ICS and wholesalers on inventory levels and levels of hospital purchases and the Company considers this data in determining the amounts of these allowances and accruals. The specific considerations the Company uses in estimating these amounts are as follows: • Product returns. The Company’s customers have the right to return any unopened product during the 18 -month period beginning six months prior to the labeled expiration date and ending 12 months after the labeled expiration date. As a result, in calculating the accrual for product returns, the Company must estimate the likelihood that product sold might not be used within six months of expiration and analyze the likelihood that such product will be returned within 12 months after expiration. The Company considers all of these factors and adjusts the accrual periodically throughout each quarter to reflect actual experience. When customers return product, they are generally given credit against amounts owed. The amount credited is charged to the Company’s product returns accrual. In estimating the likelihood of product being returned, the Company relies on information from ICS and wholesalers regarding inventory levels, measured hospital demand as reported by third-party sources and internal sales data. The Company also considers the past buying patterns of ICS and wholesalers, the estimated remaining shelf life of product previously shipped, the expiration dates of product currently being shipped, price changes of competitive products and introductions of generic products. At December 31, 2017 and 2016 , the Company’s accrual for product returns was $4.3 million and $1.6 million , respectively. • Chargebacks and rebates. Although the Company primarily sells Angiomax to ICS in the United States, the Company typically enters into agreements with hospitals, either directly or through group purchasing organizations acting on behalf of their hospital members, in connection with the hospitals’ purchases of Angiomax. Based on these agreements, most of the Company’s hospital customers have the right to receive a discounted price for Angiomax and volume-based rebates on Angiomax purchases. In the case of discounted pricing, the Company typically provides a credit to ICS, or a chargeback, representing the difference between ICS’ acquisition list price and the discounted price. In the case of the volume-based rebates, the Company typically pays the rebate directly to the hospitals. The Company also participates in the 340B Drug Pricing Program under the Public Health Services Act. Under the 340B Drug Pricing Program, the Company offers qualifying entities a discount off the commercial price of Angiomax for patients undergoing percutaneous coronary intervention on an outpatient basis. As a result of these agreements, at the time of product shipment, the Company estimates the likelihood that product sold to ICS might be ultimately sold to a contracting hospital or group purchasing organization. The Company also estimates the contracting hospital’s or group purchasing organization’s volume of purchases. The Company bases its estimates on industry data, hospital purchases and the historic chargeback data it receives from ICS, most of which ICS receives from wholesalers, which details historic buying patterns and sales mix for particular hospitals and group purchasing organizations, and the applicable customer chargeback rates and rebate thresholds. With the entrance of generic products and their impact on pricing in the marketplace, the Company is no longer able to reasonably estimate these chargebacks with respect to Angiomax. The Company’s allowance for chargebacks was $5.9 million and $1.9 million at December 31, 2017 and 2016 , respectively. The Company’s allowance for rebates was not material at December 31, 2017 and 2016 . • Fees-for-service. The Company offers discounts to certain wholesalers, Cardinal Health Inc. and ICS based on contractually determined rates for certain services. The Company estimates its fee-for-service accruals and allowances based on historical sales, wholesaler and distributor inventory levels and the applicable discount rate. The Company’s discounts are accrued at the time of the sale and are typically settled within 60 days after the end of each respective quarter. The Company’s fee-for-service accruals and allowances were $0.9 million and $0.8 million at December 31, 2017 and 2016 , respectively. The Company has adjusted its allowances for chargebacks and accruals for product returns, rebates and fees-for-service in the past based on actual sales experience, and the Company will likely be required to make adjustments to these allowances and accruals in the future. The Company continually monitors its allowances and accruals and makes adjustments when it believes actual experience may differ from its estimates. The following table provides a summary of activity with respect to the Company’s sales allowances and accruals during 2017 , 2016 and 2015 (amounts in thousands): Cash Discounts Returns Chargebacks Rebates Fees-for- Service Balance at January 1, 2015 $ 4,142 $ 3,349 $ 44,399 $ — $ 924 Allowances for sales during 2015 9,212 12,143 107,564 833 14,249 Actual credits issued for prior year’s sales (3,927 ) (3,528 ) (40,419 ) — (1,179 ) Actual credits issued for sales during 2015 (8,540 ) (3,221 ) (95,828 ) (733 ) (11,314 ) Balance at December 31, 2015 887 8,743 15,716 100 2,680 Allowances for sales during 2016 1,854 (1,424 ) 36,197 (6 ) 3,166 Actual credits issued for prior year’s sales (887 ) (5,233 ) (15,610 ) (50 ) (2,655 ) Actual credits issued for sales during 2016 (1,573 ) (502 ) (34,408 ) (29 ) (2,365 ) Balance at December 31, 2016 281 1,584 1,895 15 826 Allowances for sales during 2017 1,746 4,439 17,395 271 3,085 Actual credits issued for prior year’s sales (281 ) (1,464 ) (1,246 ) (15 ) (865 ) Actual credits issued for sales during 2017 (775 ) (220 ) (12,172 ) (126 ) (2,152 ) Balance at December 31, 2017 $ 971 $ 4,339 $ 5,872 $ 145 $ 894 International Distributors. Under the Company’s agreements with its primary international distributors, the Company sells Angiomax to these distributors at a fixed price. The established price is typically determined once per year, prior to the first shipment of Angiomax to the distributor each year. The minimum selling price used in determining the price is 50% of the average net unit selling price. Revenue associated with sales to the Company’s international distributors during 2017 , 2016 and 2015 was $0.2 million , $1.1 million and $1.1 million , respectively. Cost of Product Revenues Cost of product revenues consists of expenses in connection with the manufacture of Angiomax, Cleviprex, ready-to-use Argatroban, Kengreal and Ionsys, royalty expenses under the Company’s agreements with Biogen Idec (Biogen) and Health Research Inc. (HRI) related to Angiomax, with AstraZeneca AB (AstraZeneca) related to Cleviprex and with Eagle Pharmaceuticals, Inc. (Eagle) related to ready-to-use Argatroban and the logistics costs related to Angiomax, Cleviprex, ready-to-use Argatroban, Kengreal and Ionsys including distribution, storage and handling costs. Amounts billed for shipping and handling are recorded as revenue. Shipping and handling expenses are recorded as a component of cost of product revenue. Advertising Costs The Company expenses advertising costs as incurred. Advertising costs were approximately $1.2 million for the year ended December 31, 2015 . Advertising costs for the years ended December 31, 2017 and 2016 were de minimis. Research and Development Research and development costs are expensed as incurred. Clinical study costs are accrued over the service periods specified in the contracts and adjusted as necessary based upon an ongoing review of the level of effort and costs actually incurred. Payments for a product license prior to regulatory approval of the product and payments for milestones achieved prior to regulatory approval of the product are expensed in the period incurred as research and development. Milestone payments made in connection with regulatory approvals are capitalized and amortized to cost of revenue over the remaining useful life of the asset. The Company performs research and development for US government agencies under a cost-reimbursable contract in which the Company is reimbursed for direct costs incurred plus allowable indirect costs. The Company recognizes the reimbursements under research contracts when a contract has been executed, the contract price is fixed and determinable, delivery of services or products has occurred and collection of the contract price is reasonably assured. The reimbursements are classified as an offset to research and development expenses. Payments received in advance of work performed are deferred. The Company recorded approximately $9.0 million , $15.8 million and $22.5 million of reimbursements by the government as a reduction of research and development expenses for the years ended December 31, 2017 , 2016 and 2015 , respectively. Share-Based Compensation The Company recognizes expense using the accelerated expense attribution method in an amount equal to the fair value of all share-based awards granted to employees. The Company estimates the fair value of its options on the date of grant using the Black-Scholes closed-form option-pricing model. Expected volatilities are based principally on historic volatility of the Company’s common stock. The Company uses historical data to estimate forfeiture rate. The expected term of options represents the period of time that options granted are expected to be outstanding. The Company has made a determination of expected term by analyzing employees’ historical exercise experience. The risk-free interest rate is based on the U.S. Treasury yield in effect at the time of grant corresponding with the expected life of the options. Foreign Currencies The functional currencies of the Company’s foreign subsidiaries primarily are the local currencies: Euro, Swiss franc, and British pound sterling. The Company’s assets and liabilities are translated using the current exchange rate as of the balance sheet date. Stockholders’ equity is translated using historical rates at the balance sheet date. Revenues and expenses and other items of income are translated using a weighted average exchange rate over the period ended on the balance sheet date. Adjustments resulting from the translation of the financial statements of the Company’s foreign subsidiaries into U.S. dollars are excluded from the determination of net earnings (loss) and are accumulated in a separate component of stockholders’ equity. Foreign exchange transaction gains and losses are included in other income (loss) in the Company’s results of operations. Income Taxes The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The Company records net deferred tax assets to the extent it believes these assets will more likely than not be realized. On a periodic basis, the Company evaluates the realizability of its deferred tax assets net of deferred tax liabilities and adjusts such amounts in light of changing facts and circumstances, including but not limited to its level of past and future taxable income, the current and future expected utilization of tax benefit carryforwards, any regulatory or legislative actions by relevant authorities with respect to the Angiomax patents, and the status of litigation with respect to those patents. The Company considers all available evidence, both positive and negative, to determine whether, based on the weight of that evidence, a valuation allowance is required to reduce the net deferred tax assets to the amount that is more likely than not to be realized in future periods. The Company’s annual effective tax rate is based on pre-tax earnings adjusted for differences between GAAP and income tax accounting, existing statutory tax rates, limitations on the use of net operating loss and tax credit carryforwards and tax planning opportunities available in the jurisdictions in which it operates. The Company records uncertain tax positions on the basis of a two-step process whereby (1) it determines whether it is more likely than not that a tax |
Inventory
Inventory | 12 Months Ended |
Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Inventory | Inventory The major classes of inventory were as follows: 2017 2016 (In thousands) Raw materials $ 1,389 $ 18,714 Work-in-progress 3,608 8,397 Finished goods 562 1,375 Total $ 5,559 $ 28,486 The Company reviews inventory, including inventory purchase commitments, for slow moving or obsolete amounts based on expected product sales volume and provides reserves against the carrying amount of inventory as appropriate. For the year ended December 31, 2017, upon review of expected future product sales volumes and the projected expiration of inventory, the Company recorded a $16.7 million reserve for potential inventory obsolescence, mainly related to Angiomax. For the year ended December 31, 2016, upon review of expected future product sales volumes and the projected expiration of certain components of Ionsys, the Company recorded an $8.5 million reserve for potential inventory obsolescence. |
Fixed Assets
Fixed Assets | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Fixed Assets | Fixed Assets Fixed assets consist of the following: Estimated December 31, Life (Years) 2017 2016 (In thousands) Furniture, fixtures and equipment 2-15 $ 20,603 $ 25,132 Computer software 2-5 3,524 3,722 Computer hardware 2-5 3,054 3,795 Leasehold improvements 2-15 33,064 30,702 60,245 63,351 Less: Accumulated depreciation (42,991 ) (32,390 ) $ 17,254 $ 30,961 Depreciation expense was approximately $6.8 million , $4.5 million and $5.1 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. |
Cash, Cash Equivalents and Rest
Cash, Cash Equivalents and Restricted Cash | 12 Months Ended |
Dec. 31, 2017 | |
Cash and Cash Equivalents [Abstract] | |
Cash, Cash Equivalents and Restricted Cash | Cash, Cash Equivalents and Restricted Cash The Company considers all highly liquid investments purchased with original maturities at the date of purchase of three months or less to be cash equivalents. At December 31, 2017 and 2016 , the Company had cash and cash equivalents of $151.4 million and $541.8 million , respectively, which consisted of cash of $139.3 million and $485.7 million and money market funds with maturities less than three months of $12.1 million and $56.1 million at December 31, 2017 and 2016 , respectively. Restricted Cash The Company had restricted cash of $5.5 million and $5.0 million at December 31, 2017 and 2016 , respectively, which included $4.1 million and $3.7 million reserved for an outstanding letter of credit associated with foreign taxes at December 31, 2017 and 2016 , respectively, $1.0 million at both December 31, 2017 and 2016 for an outstanding letter of credit associated with the lease for the office space in Parsippany, New Jersey. The funds are invested in certificates of deposit. The letter of credit permits draws by the landlord to cure defaults by the Company. In addition, as a result of the acquisition of Targanta Therapeutics Corporation (Targanta) in 2009, the Company had restricted cash of $0.2 million and $0.1 million at December 31, 2017 and 2016 , respectively, in the form of a guaranteed investment certificate collateralizing an available credit facility. The Company also had restricted cash of $0.3 million and $0.2 million at December 31, 2017 and 2016 , respectively, related to certain foreign tender requirements. |
Acquisition
Acquisition | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
Acquisition | Acquisition Annovation On February 2, 2015, the Company completed the acquisition of Annovation, and Annovation became the Company’s wholly owned subsidiary. As a result of the acquisition of Annovation, the Company acquired MDCO-700, a novel intravenous anesthetic. Under the terms of the acquisition agreement, the Company paid to the holders of Annovation’s capital stock and the holders of options to purchase shares of Annovation’s capital stock, which the Company refers to collectively as the Annovation equityholders, an aggregate of approximately $28.4 million in cash. In addition, the Company may be obligated to pay Annovation’s equityholders up to an additional $26.3 million in milestone payments subsequent to the closing if the Company achieves certain development and regulatory approval milestones at the times and on the conditions set forth in the acquisition agreement. The Company has also agreed to pay Annovation equityholders a low single digit percentage of worldwide net sales, if any, of certain Annovation products, including ABP-700, during a specified earnout period. The Company accounted for this transaction as a step acquisition which required that the Company remeasure its then existing 35.8% ownership interest (previously accounted for as an equity method investment) to fair value at the acquisition date based upon the total enterprise value, adjusting for a control premium. The fair value of the Company’s interest in Annovation was $25.9 million at closing, resulting in a non-cash pre-tax gain of $22.7 million , recorded as gain on remeasurement of equity investment in the Company’s accompanying consolidated statements of operations. The Company’s previously recorded equity method investment in Annovation was derecognized from the Company’s consolidated balance sheets. Since the date of the step acquisition, the financial results of Annovation were included within the Company’s consolidated financial statements. In accordance with the acquisition method of accounting, the Company allocated the acquisition cost for the Annovation transaction to the underlying assets acquired and liabilities assumed by the Company, based upon estimated fair values of those assets and liabilities at the date of acquisition and classified the fair value of acquired IPR&D as indefinite-lived assets until the successful completion or abandonment of the associated research and development efforts. The goodwill recorded as part of the acquisition is primarily related to establishing a deferred tax liability for the IPR&D intangible asset which has no tax basis and, therefore, will not result in a future tax deduction. The Company does not expect any portion of this goodwill to be deductible for tax purposes. The Company did not incur any significant acquisition related costs in connection with the Annovation acquisition during 2015. In addition, as a result of the Company’s acquisition of Annovation, it, through its subsidiary Annovation, is a party to a license agreement with The General Hospital Corporation. Under the agreement, the Company will be obligated to pay General Hospital Corporation up to an aggregate of $6.5 million upon achievement of specified development, regulatory and sales milestones. The Company will also be obligated to pay General Hospital Corporation low single-digit percentage royalties on a product-by-product and country-by-country basis based on net sales of ABP-700 products until the later of the duration of the licensed patent rights which are necessary to manufacture, use or sell ABP-700 products in a country and the date ten years from the Company’s first commercial sale of ABP-700 products in such country. Total purchase price, in thousands, is summarized as follows: Upfront cash consideration $ 28,397 Fair value of existing equity interest in Annovation 25,886 Total cash consideration and fair value of existing equity interest 54,283 Fair value of contingent cash payment 18,000 Total purchase price $ 72,283 Below is a summary which details, in thousands, the allocation of assets acquired and liabilities assumed as a result of this acquisition: Assets acquired: Cash and cash equivalents $ 1,482 Other current assets 692 IPR&D 65,000 Goodwill 24,530 Total assets $ 91,704 Liabilities assumed: Accrued expenses $ 398 Contingent purchase price 18,000 Deferred tax liability, net 19,023 Total liabilities $ 37,421 Total cash price paid upon acquisition and fair value of existing equity interest $ 54,283 Pro forma results of operations for the acquisition of Annovation have not been presented because this acquisition is not material to the Company’s consolidated results of operations. In August 2017, the Company announced that it discontinued the clinical development program for MDCO-700. In connection with this decision, the Company’s consolidated statement of operations for the year ended December 31, 2017 includes the following non-cash adjustments that were recorded during the second quarter of 2017: $65.0 million of asset impairment charges related to IPR&D acquired from Annovation, a $14.7 million decrease in the carrying value of the contingent purchase price to an estimated fair value of zero , and a $23.0 million benefit for income taxes due to a reduction in the Company’s recorded valuation allowance against its deferred tax assets as a result of the impairment charge. |
Intangible Assets and Goodwill
Intangible Assets and Goodwill | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets and Goodwill | Intangible Assets and Goodwill The following table sets forth the carrying amounts and accumulated amortization of the Company’s intangible assets: As of December 31, 2017 As of December 31, 2016 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount (In thousands) Amortizable intangible assets Product licenses (1) $ — $ — $ — $ 30,000 $ (3,013 ) $ 26,987 Developed product rights (2) — — — 250,000 (19,802 ) 230,198 Total $ — $ — $ — $ 280,000 $ (22,815 ) $ 257,185 Intangible assets not subject to amortization: In-process research & development — — — 65,000 — 65,000 Total intangible assets not subject to amortization: — — — 65,000 — 65,000 Total intangible assets $ — $ — $ — $ 345,000 $ (22,815 ) $ 322,185 _______________________________________ (1) The Company amortizes intangible assets related to the product licenses over their expected useful lives. (2) The Company amortizes intangible assets related to developed product rights over the remaining life of the patents. In the second quarter of 2017, the Company recorded impairment charges of $226.5 million and $26.2 million to reduce the unamortized carrying amounts of the developed product rights and product licenses, respectively, associated with Ionsys to their estimated fair values of zero which is a Level 3 fair value measurement, as a result of the discontinuation and market withdrawal of Ionsys which became effective on June 19, 2017. In the second quarter of 2017, the Company also recorded impairment charges of $65.0 million to reduce the carrying amount of the IPR&D associated with MDCO-700 to an estimated fair value of zero , which is a Level 3 fair value measurement, in connection with management’s decision to discontinue the MDCO-700 trials. These impairment charges were recorded in asset impairment charges in the accompanying consolidated statements of operations. See Note 1, “Nature of Business,” for further details and Note 14, “Fair Value Measurements,” for definitions of hierarchy levels. Amortization expense was $4.5 million , $17.5 million and $10.0 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. The Company records amortization expense in cost of revenue in the accompanying consolidated statements of operations. The changes in the carrying amount of goodwill for the years ended December 31, 2017 and 2016 are as follows: December 31, December 31, (In thousands) Balance at beginning of period $ 200,571 $ 234,383 Allocation of goodwill to the Non-Core ACC Products — (33,812 ) Balance at end of period $ 200,571 $ 200,571 In the second quarter of 2016, the Company allocated approximately $33.8 million of its goodwill to the sale of the Non-Core ACC Products. See Note 22, “Dispositions,” for further details on the sale of the Non-Core ACC Products. |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Dec. 31, 2017 | |
Other Liabilities Disclosure [Abstract] | |
Accrued Expenses | Accrued Expenses Accrued expenses consisted of the following at December 31, 2017 and 2016 : 2017 2016 (In thousands) Royalties $ 1,039 $ 739 Research and development services 43,496 11,477 Compensation related 25,621 28,802 Product returns, rebates and other fees 5,363 2,336 Legal, accounting and other 6,162 4,821 Manufacturing, logistics and related fees 1,984 6,200 Sales and marketing 1,875 1,575 Interest 9,657 10,888 Total $ 95,197 $ 66,838 |
Convertible Senior Notes
Convertible Senior Notes | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Convertible Senior Notes | Convertible Senior Notes Convertible Senior Notes Due 2023 In June 2016, the Company issued, at par value, $402.5 million aggregate principal amount of 2.75% convertible senior notes due 2023 (the 2023 Notes). The 2023 Notes bear cash interest at a rate of 2.75% per year, payable semi-annually on January 15 and July 15 of each year, beginning on January 15, 2017. The 2023 Notes will mature on July 15, 2023. The net proceeds to the Company from the offering were $390.8 million after deducting the initial purchasers’ discounts and commissions and the offering expenses payable by the Company. The 2023 Notes are governed by an indenture (the 2023 Notes Indenture) with Wells Fargo Bank, National Association, a national banking association, as trustee (the 2023 Notes Trustee). The 2023 Notes are senior unsecured obligations of the Company and will rank senior in right of payment to the Company’s future indebtedness that is expressly subordinated in right of payment to the 2023 Notes; equal in right of payment to the Company’s existing and future unsecured indebtedness that is not so subordinated; effectively junior in right of payment to any of the Company’s secured indebtedness to the extent of the value of the assets securing such indebtedness; and structurally junior to all existing and future indebtedness and other liabilities (including trade payables) incurred by the Company’s subsidiaries. Holders may convert their 2023 Notes at their option at any time prior to the close of business on the business day immediately preceding April 15, 2023 only under the following circumstances: • during any calendar quarter commencing on or after September 30, 2016 (and only during such calendar quarter), if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; • during the five business day period after any five consecutive trading day period (the ‘‘measurement period’’) in which the trading price (as defined in the 2023 Notes Indenture) per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company’s common stock and the conversion rate on each such trading day; • during any period after the Company has issued notice of redemption until the close of business on the scheduled trading day immediately preceding the relevant redemption date; or • upon the occurrence of specified corporate events. On or after April 15, 2023, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert their 2023 Notes at any time, regardless of the foregoing circumstances. Upon conversion, the Company will pay or deliver, as the case may be, cash, shares of the Company’s common stock or a combination thereof, at the Company’s option, based upon a daily conversion value calculated on a proportionate basis for each trading day in a 50 trading day observation period (as more fully described in the 2023 Notes Indenture). The conversion rate for the 2023 Notes was initially, and remains, 20.4198 shares of the Company’s common stock per $1,000 principal amount of the 2023 Notes, which is equivalent to an initial conversion price of approximately $48.97 per share of the Company’s common stock. The Company may not redeem the 2023 Notes prior to July 15, 2020. The Company may redeem for cash all or any portion of the 2023 Notes, at its option, on or after July 15, 2020 if the last reported sale price of its common stock has been at least 130% of the conversion price then in effect on the last trading day of, and for at least 19 other trading days (whether or not consecutive) during, any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption, at a redemption price equal to 100% of the principal amount of the 2023 Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. No redemption date may be designated that falls on or after the 52 nd scheduled trading date prior to maturity. No sinking fund is provided for the 2023 Notes, which means that the Company is not required to redeem or retire the 2023 Notes periodically. If the Company undergoes a fundamental change (as defined in the 2023 Notes Indenture), subject to certain conditions, holders of the 2023 Notes may require the Company to repurchase for cash all or part of their 2023 Notes at a repurchase price equal to 100% of the principal amount of the 2023 Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. The 2023 Notes Indenture governing the 2023 Notes contains customary events of default with respect to the 2023 Notes, including that upon certain events of default (including the Company’s failure to make any payment of principal or interest on the 2023 Notes when due and payable) occurring and continuing, the 2023 Notes Trustee by notice to the Company, or the holders of at least 25% in principal amount of the outstanding 2023 Notes by notice to the Company and the 2023 Notes Trustee, may, and the 2023 Notes Trustee at the request of such holders (subject to the provisions of the 2023 Notes Indenture) shall, declare 100% of the principal of and accrued and unpaid interest, if any, on all the 2023 Notes to be due and payable. In case of certain events of bankruptcy, insolvency or reorganization, involving the Company or a significant subsidiary, 100% of the principal of and accrued and unpaid interest on the 2023 Notes will automatically become due and payable. Upon such a declaration of acceleration, such principal and accrued and unpaid interest, if any, will be due and payable immediately. In accounting for the issuance of the 2023 Notes, the Company separated the 2023 Notes into liability and equity components. The carrying amount of the liability component was calculated by measuring the fair value of a similar liability that does not have an associated convertible feature. The carrying amount of the equity component representing the conversion option was determined by deducting the fair value of the liability component from the par value of the 2023 Notes as a whole. The excess of the principal amount of the liability component over its carrying amount, referred to as the debt discount, is amortized to interest expense over the seven -year term of the 2023 Notes. The equity component is not re-measured as long as it continues to meet the conditions for equity classification. The equity component related to the 2023 Notes is $101.0 million and is recorded in additional paid-in capital on the accompanying consolidated balance sheet. In accounting for the transaction costs related to the issuance of the 2023 Notes, the Company allocated the total costs incurred to the liability and equity components of the 2023 Notes based on their relative values. Transaction costs attributable to the liability component are amortized to interest expense over the seven -year term of the 2023 Notes, and transaction costs attributable to the equity component are netted with the equity components in stockholders’ equity. Additionally, the Company initially recorded a net deferred tax liability of $33.5 million in connection with the 2023 Notes. The 2023 Notes consist of the following: Liability component December 31, 2017 December 31, 2016 (in thousands) Principal $ 402,500 $ 402,500 Less: Debt discount, net (1) (90,552 ) (103,162 ) Net carrying amount $ 311,948 $ 299,338 _______________________________________ (1) Included in the accompanying consolidated balance sheets within convertible senior notes (due 2023) and amortized to interest expense over the remaining life of the 2023 Notes using the effective interest rate method. The fair value of the 2023 Notes was approximately $377.1 million as of December 31, 2017 . The Company estimates the fair value of its 2023 Notes utilizing market quotations for debt that have quoted prices in active markets. Since the 2023 Notes do not trade on a daily basis in an active market, the fair value estimates are based on market observable inputs based on borrowing rates currently available for debt with similar terms and average maturities, which are classified as Level 2 measurements within the fair value hierarchy. See Note 14, “Fair Value Measurements,” for definitions of hierarchy levels. As of December 31, 2017 , the remaining contractual life of the 2023 Notes is approximately 5.5 years. The following table sets forth total interest expense recognized related to the 2023 Notes: Years Ended December 31, 2017 2016 2015 (in thousands) Contractual interest expense $ 11,060 $ 6,158 $ — Amortization of debt discount 12,610 6,648 — Total $ 23,670 $ 12,806 $ — Effective interest rate of the liability component 7.5 % 7.5 % — % Capped Call Transactions In June 2016, the Company entered into capped call transactions with certain counterparties of the 2023 Notes or their respective affiliates or other financial institutions. The Company used approximately $33.9 million of the net proceeds from the offering to pay the cost of the capped call transactions, which is included as a net reduction to additional paid-in capital on the accompanying consolidated balance sheet. The capped call transactions are expected to reduce the potential dilution with respect to shares of the Company’s common stock upon any conversion of the 2023 Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted 2023 Notes, as the case may be, if the market price of the Company’s common stock is then greater than the strike price of the capped call transactions. Such reduction of potential dilution or offset of cash payments is subject to a cap based on the cap price of the capped call transactions. The cap price of the capped calls is currently $64.68 . For any conversions of the 2023 Notes prior to the close of business on the 52 nd scheduled trading day immediately preceding the stated maturity date of the 2023 Notes, including without limitation upon an acquisition of the Company or similar business combination, a corresponding portion of the capped calls will be terminated. Upon such termination, the portion of the capped calls being terminated will be settled at fair value (subject to certain limitations), as determined by the counterparties to the capped calls and no payments will be due from the Company to such counterparties. The capped calls expire on the earlier of (i) the last day on which any Convertible Securities remain outstanding and (ii) the second “Scheduled Trading Day” (as defined in the 2023 Notes Indenture) immediately preceding the “Maturity Date” (as defined in the 2023 Notes Indenture). Convertible Senior Notes Due 2022 In January 2015, the Company issued, at par value, $400.0 million aggregate principal amount of 2.5% convertible senior notes due 2022 (2022 Notes). The 2022 Notes bear cash interest at a rate of 2.5% per year, payable semi-annually on January 15 and July 15 of each year, beginning on July 15, 2015. The 2022 Notes will mature on January 15, 2022. The net proceeds to the Company from the offering were $387.2 million after deducting the initial purchasers’ discounts and commissions and the offering expenses payable by the Company. The 2022 Notes are governed by an indenture (the 2022 Notes Indenture) with Wells Fargo Bank, National Association, a national banking association, as trustee (the 2022 Notes Trustee). The 2022 Notes are senior unsecured obligations of the Company and will rank senior in right of payment to the Company’s future indebtedness that is expressly subordinated in right of payment to the 2022 Notes; equal in right of payment to the Company’s existing and future unsecured indebtedness that is not so subordinated; effectively junior in right of payment to any of the Company’s secured indebtedness to the extent of the value of the assets securing such indebtedness; and structurally junior to all existing and future indebtedness and other liabilities (including trade payables) incurred by the Company’s subsidiaries. Holders may convert their 2022 Notes at their option at any time prior to the close of business on the business day immediately preceding October 15, 2021 only under the following circumstances: • during any calendar quarter commencing on or after March 31, 2015 (and only during such calendar quarter), if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; • during the five business day period after any five consecutive trading day period (the measurement period) in which the trading price (as defined in the 2022 Notes Indenture) per $1,000 principal amount of 2022 Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company’s common stock and the conversion rate on each such trading day; • during any period after the Company has issued notice of redemption until the close of business on the scheduled trading day immediately preceding the relevant redemption date; or • upon the occurrence of specified corporate events. On or after October 15, 2021, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert their 2022 Notes at any time, regardless of the foregoing circumstances. Upon conversion, the Company will pay cash up to the aggregate principal amount of the 2022 Notes to be converted and deliver shares of its common stock in respect of the remainder, if any, of its conversion obligation in excess of the aggregate principal amount of 2022 Notes being converted, subject to a daily share cap. The conversion rate for the 2022 Notes was initially, and remains, 29.8806 shares of the Company’s common stock per $1,000 principal amount of the 2022 Notes, which is equivalent to an initial conversion price of approximately $33.47 per share of the Company’s common stock. The Company may not redeem the 2022 Notes prior to January 15, 2019. The Company may redeem for cash all or any portion of the 2022 Notes, at its option, on or after January 15, 2019 if the last reported sale price of its common stock has been at least 130% of the conversion price then in effect on the last trading day of, and for at least 19 other trading days (whether or not consecutive) during, any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption, at a redemption price equal to 100% of the principal amount of the 2022 Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. No sinking fund is provided for the 2022 Notes, which means that the Company is not required to redeem or retire the 2022 Notes periodically. If the Company undergoes a “fundamental change” (as defined in the Indenture governing the 2022 Notes Indenture), subject to certain conditions, holders of the 2022 Notes may require the Company to repurchase for cash all or part of their 2022 Notes at a repurchase price equal to 100% of the principal amount of the 2022 Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. The 2022 Notes Indenture contains customary events of default with respect to the 2022 Notes, including that upon certain events of default (including the Company’s failure to make any payment of principal or interest on the 2022 Notes when due and payable) occurring and continuing, the 2022 Notes Trustee by notice to the Company, or the holders of at least 25% in principal amount of the outstanding 2022 Notes by notice to the Company and the 2022 Notes Trustee, may, and the 2022 Notes Trustee at the request of such holders (subject to the provisions of the 2022 Notes Indenture) shall, declare 100% of the principal of and accrued and unpaid interest, if any, on all the 2022 Notes to be due and payable. In case of certain events of bankruptcy, insolvency or reorganization, involving the Company or a significant subsidiary, 100% of the principal of and accrued and unpaid interest on the 2022 Notes will automatically become due and payable. Upon such a declaration of acceleration, such principal and accrued and unpaid interest, if any, will be due and payable immediately. In accounting for the issuance of the 2022 Notes, the Company separated the 2022 Notes into liability and equity components. The carrying amount of the liability component was calculated by measuring the fair value of a similar liability that does not have an associated convertible feature. The carrying amount of the equity component representing the conversion option was determined by deducting the fair value of the liability component from the par value of the 2022 Notes as a whole. The excess of the principal amount of the liability component over its carrying amount, referred to as the debt discount, is amortized to interest expense over the seven -year term of the 2022 Notes. The equity component is not re-measured as long as it continues to meet the conditions for equity classification. The equity component related to the 2022 Notes is $88.9 million and is recorded in additional paid-in capital on the accompanying consolidated balance sheets. In accounting for the transaction costs related to the issuance of the 2022 Notes, the Company allocated the total costs incurred to the liability and equity components of the 2022 Notes based on their relative values. Transaction costs attributable to the liability component are amortized to interest expense over the seven -year term of the 2022 Notes, and transaction costs attributable to the equity component are netted with the equity components in stockholders’ equity. Additionally, the Company initially recorded a net deferred tax liability of $31.8 million in connection with the 2022 Notes. The 2022 Notes consist of the following: Liability component December 31, 2017 December 31, 2016 (In thousands) Principal $ 399,997 $ 400,000 Less: Debt discount, net (1) (62,747 ) (75,754 ) Net carrying amount $ 337,250 $ 324,246 _______________________________________ (1) Included on the accompanying consolidated balance sheets within convertible senior notes (due 2022) and amortized to interest expense over the remaining life of the 2022 Notes using the effective interest rate method. The fair value of the 2022 Notes was approximately $417.6 million as of December 31, 2017 . The Company estimates the fair value of its 2022 Notes utilizing market quotations for debt that have quoted prices in active markets. Since the 2022 Notes do not trade on a daily basis in an active market, the fair value estimates are based on market observable inputs based on borrowing rates currently available for debt with similar terms and average maturities, which are classified as Level 2 measurements within the fair value hierarchy. See Note 14, “Fair Value Measurements,” for definitions of hierarchy levels. As of December 31, 2017 , the remaining contractual life of the 2022 Notes is approximately 4.0 years. The following table sets forth total interest expense recognized related to the 2022 Notes: Years Ended December 31, 2017 2016 2015 (In thousands) Contractual interest expense $ 10,000 $ 10,000 $ 9,639 Amortization of debt discount 13,007 12,139 10,942 Total $ 23,007 $ 22,139 $ 20,581 Effective interest rate of the liability component 6.50 % 6.50 % — % Convertible Senior Notes Due 2017 In June 2012, the Company issued, at par value, $275.0 million aggregate principal amount of 1.375% convertible senior notes due June 1, 2017 (2017 Notes). The 2017 Notes bore cash interest at a rate of 1.375% per year, payable semi-annually on June 1 and December 1 of each year, beginning on December 1, 2012. The 2017 Notes matured on June 1, 2017. The net proceeds to the Company from the offering were $266.2 million after deducting the initial purchasers’ discounts and commissions and the offering expenses payable by the Company. In June 2016, the Company used approximately $323.2 million of the net proceeds of the 2023 Notes to repurchase $220.0 million in aggregate principal amount of the 2017 Notes in privately negotiated transactions effected through the initial purchasers of the 2017 Notes. As part of the repurchase of the 2017 Notes, the Company settled a proportionate amount of outstanding bond hedges and warrants related to the 2017 Notes for a net cash receipt of $12.6 million . The Company recorded a loss of $5.4 million on the extinguishment of debt in the accompanying consolidated statements of operations during the year ended December 31, 2016 and accounted for the difference of $108.7 million between the consideration transferred to the holder and the fair value of the liability component of the 2017 Notes as a reduction of additional paid-in capital on the accompany consolidated balance sheet. The 2017 Notes that remained outstanding after the 2016 repurchase matured on June 1, 2017. In connection with the maturity of the 2017 Notes, the holders converted substantially all of the outstanding principal amount of the 2017 Notes, the Company paid cash to the converting 2017 Note holders equal to $55.4 million in respect of principal, interest and fractional shares on the 2017 Notes to be converted and delivered 819,901 shares of the Company’s common stock. The 2017 Notes consisted of the following: Liability component December 31, December 31, (In thousands) Principal $ — $ 55,000 Less: Debt discount, net (1) — (1,251 ) Net carrying amount $ — $ 53,749 _______________________________________ (1) Included on the accompanying consolidated balance sheets within convertible senior notes (due 2017) and amortized to interest expense over the remaining life of the 2017 Notes using the effective interest rate method. The following table sets forth total interest expense recognized related to the 2017 Notes: Years Ended December 31, 2017 2016 2015 (In thousands) Contractual interest expense $ 315 $ 2,101 $ 3,781 Amortization of debt discount 1,251 7,395 12,734 Total $ 1,566 $ 9,496 $ 16,515 Effective interest rate of the liability component 6.02 % 6.02 % 6.02 % Note Hedges In June 2012, the Company paid an aggregate amount of $58.2 million for the 2017 Note Hedges, which was recorded as a reduction of additional paid-in-capital in stockholders’ equity. As part of the repurchase of $220.0 million in aggregate principal amount of the 2017 Notes, the Company settled the related hedges and received cash of approximately $100.5 million . The remaining 2017 Note Hedges covered approximately two million shares of the Company’s common stock, subject to anti-dilution adjustments substantially similar to those applicable to the 2017 Notes, had a strike price that corresponds to the initial conversion price of the 2017 Notes, and were exercisable upon conversion of the 2017 Notes. The 2017 Note Hedges were separate transactions entered into by the Company with the 2017 Hedge Counterparties and were not part of the terms of the 2017 Notes or the 2017 Warrants. Holders of the 2017 Notes and 2017 Warrants did not have any rights with respect to the 2017 Note Hedges. On June 1, 2017, in connection with the maturity of the 2017 Notes, the Company redeemed the 2017 Note Hedges and received from the Note Hedge counterparties 820,161 shares at a weighted average price of $48.79 per share. The redemption offset the dilution with respect to shares of the Company’s common stock issued upon the conversion of the 2017 Notes. The shares delivered to the Company in connection with the redemption of the 2017 Notes Hedges are held by the Company as treasury shares. Warrants In June 2012, the Company received aggregate proceeds of $38.4 million from the sale of warrants to the 2017 Hedge Counterparties, which the Company recorded as additional paid-in-capital in stockholders’ equity. The 2017 Warrants were separate transactions entered into by the Company with the 2017 Hedge Counterparties and are not part of the terms of the 2017 Notes or 2017 Note Hedges. Holders of the 2017 Notes and 2017 Note Hedges did not have any rights with respect to the 2017 Warrants. The 2017 Warrants also meet the definition of a derivative. Because the 2017 Warrants were indexed to the Company’s common stock and recorded in equity in the Company’s consolidated balance sheets, the 2017 Warrants were exempt from the scope and fair value provisions related to accounting for derivative instruments. As part of the June 2016 repurchase of $220 million in aggregate principal amount of the 2017 Notes, the Company paid $87.9 million to settle the related warrants. The remaining 2017 Warrants, which continued to remain outstanding after the maturity of the 2017 Notes, were to purchase up to approximately two million shares of the Company’s common stock, subject to customary anti-dilution adjustments, at a strike price of $34.20 per share. The 2017 Warrants had a dilutive effect with respect to the Company’s common stock. The 2017 Warrants expired beginning in August 2017 through a series of expiration dates ending in December 2017. The holders of the 2017 Warrants exercised 787,680 warrants on a net basis and as a result the Company issued 44,283 shares of common stock. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Preferred Stock The Company has 5,000,000 shares of preferred stock (Preferred Stock) authorized, none of which are issued. Common Stock Common stockholders are entitled to one vote per share and dividends when declared by the Company’s Board of Directors, subject to the preferential rights of any outstanding shares of Preferred Stock. Employees and directors of the Company purchased 1,949,117 , 1,312,812 and 2,989,324 shares of common stock during the years ended December 31, 2017 , 2016 and 2015 , respectively, pursuant to option exercises and the Company’s employee stock purchase plan. The aggregate net proceeds to the Company resulting from these purchases were approximately $48.6 million , $33.8 million , and $65.2 million during the years ended December 31, 2017 , 2016 and 2015 , respectively, and are included within the financing activities section of the accompanying consolidated statements of cash flows. The Company issued 166,103 , 132,344 and 166,042 shares under restricted stock awards during the years ended December 31, 2017 , 2016 and 2015 , respectively. On May 29, 2015, the Company filed a certificate of amendment to its Third Amended and Restated Certificate of Incorporation with the Secretary of State of the state of Delaware that increased the number of authorized shares of common stock from 125,000,000 shares to 187,500,000 shares. In August 2015, the Company issued 944,537 shares of its common stock in a private placement. Cash received from the August 2015 private placement totaled $30.0 million and is included within the financing activities section of the accompanying consolidated statements of cash flows. These shares are included in the Company’s weighted average number of common stock outstanding. Treasury Stock On June 5, 2012 , the Company’s Board of Directors authorized the Company to use a portion of the net proceeds of the 2017 Notes offering to repurchase up to an aggregate of $50.0 million of its common stock. The Company repurchased 2,192,982 shares of its common stock in the second quarter of 2013 for an aggregate cost of $50.0 million . On June 1, 2017, in connection with the maturity of the 2017 Notes, the Company redeemed the 2017 Note Hedges and received from the Note Hedge counterparties 820,161 shares at a weighted average price of $48.79 per share. The redemption offset the dilution with respect to shares of the Company’s common stock issued upon the conversion of the 2017 Notes. The shared delivered to the Company in connection with the redemption of the 2017 Notes Hedges are held by the Company as treasury shares. As of December 31, 2017 , there were 3,013,143 shares of the Company’s common stock held in treasury. |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Compensation | Share-Based Compensation Stock Plans The Company has adopted the following stock incentive plans under which awards remain outstanding: • the 2013 Stock Incentive Plan (the 2013 Plan); • the 2009 Equity Inducement Plan; • the 2007 Equity Inducement Plan; and • the 2004 Stock Incentive Plan. These plans provide for the grant of stock options, other stock-based awards (including restricted stock awards, restricted stock units and stock appreciation rights) and cash-based awards to employees, officers, directors, consultants and advisors of the Company and its subsidiaries, including any individuals who have accepted an offer of employment. Stock option grants have an exercise price equal to the fair market value of the Company’s common stock on the date of grant and generally, for employee grants, have a 10 -year term and vest 25% one year after grant and thereafter in equal monthly installments over a three -year period. The fair value of stock option grants is recognized, net of an estimated forfeiture rate, using an accelerated method over the vesting period of the options, which is generally four years for employee grants and one year for director grants. As of December 31, 2017 , the Company had granted an aggregate of 28,493,250 shares as restricted stock or subject to issuance upon exercise of stock options under all of the plans, of which 7,043,490 shares remained subject to outstanding options. The Company currently only grants stock options and restricted stock awards from the 2013 Plan. In accordance with ASC 718-10, the Company recorded approximately $31.5 million , $31.0 million and $30.6 million of share-based compensation expense related to the options, restricted stock and ESPP for the years ended December 31, 2017 , 2016 and 2015 , respectively. As of December 31, 2017 , there was approximately $27.8 million of total unrecognized compensation costs related to non-vested share-based employee compensation arrangements granted under the Company’s equity compensation plans. This cost is expected to be recognized over a weighted average period of 1.22 years. Stock Option and Restricted Stock Award Activity The following table presents a summary of option activity and data under the Company’s stock incentive plans as of December 31, 2017 : Number of Shares Weighted-Average Exercise Price Per Share Weighted- Average Remaining Contractual Term (Years) Aggregate Intrinsic Value Balance at January 1, 2017 8,023,696 $ 28.27 Granted 1,693,309 $ 49.89 Exercised (1,854,644 ) $ 24.57 Forfeited and expired (818,871 ) $ 37.24 Outstanding, December 31, 2017 7,043,490 $ 33.40 5.85 $ 11,705,399 Vested and expected to vest, December 31, 2017 6,842,097 $ 33.13 5.81 $ 11,699,950 Exercisable, December 31, 2017 4,190,582 $ 28.97 5.05 $ 11,487,732 Available for future grant at December 31, 2017 3,202,401 Aggregate intrinsic value is the sum of the amounts by which the quoted market price of the Company’s common stock exceeded the exercise price of the options at December 31, 2017 , for those options for which the quoted market price was in excess of the exercise price. The weighted-average grant date fair value of options granted during the years ended December 31, 2017 , 2016 and 2015 were $18.46 , $11.72 , and $11.18 , respectively. The total intrinsic value of options exercised during the years ended December 31, 2017 , 2016 and 2015 were $34.1 million , $12.7 million , and $40.0 million , respectively. The Company recorded approximately $22.6 million , $23.2 million , and $23.0 million in compensation expense related to options in the years ended December 31, 2017 , 2016 and 2015 . The remaining expense of approximately $21.4 million will be recognized over a period of 1.25 years. For purposes of performing the valuation, employees were separated into two groups according to patterns of historical exercise behavior; the weighted average assumptions below include assumptions from the two groups of employees exhibiting different behavior. The Company estimated the fair value of each option on the date of grant using the Black-Scholes closed-form option-pricing model applying the weighted average assumptions in the following table. Years Ended December 31, 2017 2016 2015 Expected dividend yield — % — % — % Expected stock price volatility 39.14 % 37.90 % 41.49 % Risk-free interest rate 1.867 % 1.249 % 1.436 % Expected option term (years) 5.00 4.93 5.01 The following table presents a summary of the Company’s outstanding shares of restricted stock awards granted as of December 31, 2017 : Number of Shares Weighted Average Grant-Date Fair Value Balance at January 1, 2017 375,301 $ 31.88 Awarded 196,462 50.51 Vested (172,076 ) 32.80 Forfeited (30,359 ) 44.03 Outstanding, December 31, 2017 369,328 $ 40.37 The restricted stock granted to employees generally vests in equal increments of 25% per year on an annual basis commencing twelve months after grant date. The restricted stock granted to non-employee directors generally vests on the first anniversary date after the grant date. Expense of approximately $6.5 million , $6.6 million and $6.1 million was recognized related to restricted stock awards in the years ended December 31, 2017 , 2016 and 2015 , respectively. The remaining expense of approximately $6.3 million will be recognized over a period of 1.13 years. The weighted average grant date fair value of restricted stock awarded during the years ended December 31, 2017 , 2016 and 2015 were $50.51 , $33.63 , and $28.37 , respectively. The total fair value of the restricted stock that vested during the years ended December 31, 2017 , 2016 and 2015 were $8.4 million , $8.7 million and $7.1 million , respectively. 2010 ESPP The Company has adopted the 2010 Employee Stock Purchase Plan (the 2010 ESPP), which, as amended, provides for the issuance of up to 2,000,000 shares of common stock. The 2010 ESPP permits eligible employees to purchase shares of common stock at the lower of 85% of the fair market value of the common stock at the beginning or at the end of each offering period. Employees who own 5% or more of the common stock are not eligible to participate in the 2010 ESPP. Participation in the 2010 ESPP is voluntary. The Company issued 94,473 , 136,378 , and 184,432 shares under the 2010 ESPP during the years ended December 31, 2017 , 2016 and 2015 , respectively. The Company recorded approximately $1.0 million , $1.2 million and $1.5 million in compensation expense related to the 2010 ESPP in the years ended December 31, 2017 , 2016 and 2015 , respectively. The fair value of each option element of the 2010 ESPP is estimated on the date of grant using the Black-Scholes closed-form option-pricing model applying the weighted average assumptions in the following table. Expected volatilities are based on historical volatility of the Company’s common stock. Expected term represents the six -month offering period for the 2010 ESPP. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. Years Ended December 31, 2017 2016 2015 Expected dividend yield — % — % — % Expected stock price volatility 43.03 % 48.80 % 44.91 % Risk-free interest rate 0.89 % 0.34 % 0.15 % Expected option term (years) 0.5 0.5 0.5 Common Stock Reserved for Future Issuance At December 31, 2017 , there were 972,959 shares of common stock available for grant under the 2010 ESPP and 3,202,401 shares of common stock available for grant under the 2013 Plan. |
Earnings per Share
Earnings per Share | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Earnings per Share The following table sets forth the computation of basic and diluted earnings per share for the years ended December 31, 2017 , 2016 and 2015 . Year Ended December 31, 2017 2016 2015 (In thousands, except per share amounts) Amounts attributable to The Medicines Company: (Loss) income from continuing operations $ (607,695 ) $ 20,564 $ (134,806 ) Loss from discontinued operations, net of tax (100,678 ) (139,682 ) (217,950 ) Net loss attributable to The Medicines Company $ (708,373 ) $ (119,118 ) $ (352,756 ) . Weighted average common shares outstanding, basic 72,356 69,909 66,809 Plus: net effect of dilutive stock options, warrants, restricted common shares and shares issuable upon conversion of Notes — 3,113 — Weighted average common shares outstanding, diluted 72,356 73,022 66,809 Basic (loss) earnings per common share attributable to The Medicines Company: (Loss) earnings from continuing operations $ (8.40 ) $ 0.29 $ (2.02 ) Loss from discontinued operations (1.39 ) (2.00 ) (3.26 ) Basic loss per share $ (9.79 ) $ (1.71 ) $ (5.28 ) Diluted (loss) earnings per common share attributable to The Medicines Company: (Loss) earnings from continuing operations $ (8.40 ) $ 0.28 $ (2.02 ) Loss from discontinued operations (1.39 ) (1.91 ) (3.26 ) Diluted loss per share $ (9.79 ) $ (1.63 ) $ (5.28 ) Basic (loss) income per share is computed by dividing consolidated net (loss) income attributable to The Medicines Company by the weighted average number of shares of common stock outstanding during the period, excluding unvested restricted common shares. The potentially dilutive effect of the Company’s stock options, unvested restricted common stock, stock purchase warrants, the 2017 Notes (which matured on June 1, 2017) and 2022 Notes on earnings per share is computed under the treasury stock method. In 2016, the Company analyzed the potential dilutive effect of the 2023 Notes on its earnings per share under the treasury stock method. Beginning in 2017, the Company analyzes the potential dilutive effect of the 2023 Notes on earnings per share under the “if converted” method, in which it is assumed that the outstanding security converts into common stock at the beginning of the period. For periods of income from continuing operations when the effects are not anti-dilutive, diluted earnings per share is computed by dividing the net income attributable to The Medicines Company by the weighted average number of shares outstanding and the impact of all potential dilutive common shares, consisting primarily of stock options, unvested restricted common stock, shares issuable upon conversion of the 2017 Notes, 2022 Notes and 2023 Notes and stock purchase warrants. For periods of loss from continuing operations, diluted loss per share is calculated similar to basic loss per share as the effect of including all potentially dilutive common share equivalents is anti-dilutive. Due to the period of loss from continuing operations attributable to The Medicines Company, the calculation of diluted loss per share for the year ended December 31, 2017 and 2016 excluded 12,803,033 and 3,724,272 , respectively, of potentially dilutive stock options, warrants, restricted common shares, and shares issuable upon conversion of the 2017 Notes, 2022 Notes and 2023 Notes, as their inclusion would have an anti-dilutive effect. For periods of income from continuing operations when the effects are not anti-dilutive, diluted earnings per share is computed by dividing the Company’s net income by the weighted average number of shares outstanding and the impact of all potential dilutive common shares, consisting primarily of stock options, unvested restricted common stock, shares issuable upon conversion of the 2017 Notes, 2022 Notes, 2023 Notes and stock purchase warrants. To minimize the impact of potential dilution upon conversion of the 2023 Notes, the Company entered into capped call transactions separate from the issuance of the 2023 Notes with certain counterparties. The capped calls have a strike price of $48.97 and a cap price of $64.68 and are exercisable when and if the 2023 Notes are converted. If upon conversion of the 2023 Notes, the price of the Company’s common stock is above the strike price of the capped calls, the counterparties will deliver shares of the Company’s common stock and/or cash with an aggregate value equal to the difference between the price of the Company’s common stock at the conversion date and the strike price, multiplied by the number of shares of the Company’s common stock related to the capped calls being exercised. The capped call transactions that are part of the 2023 Notes are not considered for purposes of calculating the total shares outstanding under the basic and diluted net income per share, as their effect would be anti-dilutive. In June 2012, the Company issued the 2017 Notes (see Note 9 , “Convertible Senior Notes”). In connection with the issuance of the 2017 Notes, the Company entered into convertible note hedge transactions with respect to its common stock (2017 Note Hedges) with several of the initial purchasers of the 2017 Notes, their affiliates and other financial institutions (2017 Hedge Counterparties). The options that were part of the 2017 Note Hedges were not considered for purposes of calculating the total shares outstanding under the basic and diluted net income per share, as their effect would be anti-dilutive. In June 2016, as part of the repurchase of $220.0 million in aggregate principal amount of the 2017 Notes, the Company settled the hedges related to the repurchased bonds. On June 1, 2017, in connection with the maturity of the 2017 Notes, the Company redeemed the 2017 Note Hedges and received from the Note Hedge counterparties 819,901 shares at a weighted average price of $48.79 per share. The redemption offset the dilution with respect to shares of the Company’s common stock issued upon the conversion of the 2017 Notes. The shares delivered to the Company in connection with the redemption of the 2017 Notes Hedges are held by the Company as treasury shares. For the year ended December 31, 2015 , the number of shares of common stock issuable upon conversion of the 2017 Notes were excluded from the calculation of diluted loss per share as their inclusion would have been anti-dilutive. In addition, in connection with the 2017 Note Hedges, the Company entered into warrant transactions with the 2017 Hedge Counterparties, pursuant to which the Company sold warrants (2017 Warrants) to the Hedge Counterparties to purchase, subject to customary anti-dilution adjustments, up to two million shares of the Company’s common stock at a strike price of $34.20 per share. The 2017 Warrants had a dilutive effect with respect to the Company’s common stock to the extent that the market price per share of the Company’s common stock, as measured under the terms of the 2017 Warrants, exceeded the applicable strike price of the 2017 Warrants. The Company elected to settle all of the 2017 Warrants in common stock. In June 2016, as part of the repurchase of $220.0 million in aggregate principal amount of the 2017 Notes, the Company settled the warrants related to the repurchased bonds. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The benefit from (provision for) income taxes for continuing operations in 2017 , 2016 and 2015 consists of current and deferred federal, state and foreign taxes based on income as follows: 2017 2016 2015 (In thousands) Current: Federal $ 4,859 $ — $ (5 ) State (31 ) (33 ) (182 ) Foreign 1,757 (34 ) (229 ) 6,585 (67 ) (416 ) Deferred: Federal $ 88,556 $ — $ 28,011 State 1,435 — 2,138 Foreign — — — 89,991 — 30,149 Total benefit from (provision for) taxes $ 96,576 $ (67 ) $ 29,733 The Company’s deferred benefit from income taxes of $89.9 million was primarily attributable to a reduction in the Company’s recorded valuation allowance against its deferred tax assets as a result of the commencement of amortization of IPR&D associated with Vabomere upon approval by the FDA and the impairment of IPR&D associated with MDCO-700. The components of (loss) income from continuing operations attributable to The Medicines Company before income taxes consisted of: 2017 2016 2015 (In thousands) Domestic $ (704,814 ) $ 22,289 $ (163,772 ) International 543 (1,712 ) (757 ) Total $ (704,271 ) $ 20,577 $ (164,529 ) The difference between tax expense and the amount computed by applying the statutory federal income tax rate of 35% in 2017 , 2016 , and 2015 to income before income taxes is as follows: Year Ended December 31, 2017 2016 2015 (In thousands) Statutory rate applied to pre-tax (loss) income from continuing operations $ (246,495 ) $ 7,202 $ (57,589 ) (Deduct) add: State income taxes, net of federal benefit (913 ) 21 (1,273 ) Foreign 53 442 287 Revaluation of contingent purchase price (5,366 ) (10,244 ) 10,272 Tax credits (3,539 ) (967 ) (305 ) Lobbying costs — — 35 Meals and entertainment 372 605 810 Uncertain tax positions (1,635 ) (2,064 ) 61 Bargain purchase — — (7,310 ) Loss on extinguishment of debt — 1,403 — Loss on ACC goodwill — 11,834 — Excess stock option benefit (4,589 ) — — Change in federal tax rate due to the Tax Cuts and Jobs Act 126,502 — — Other 785 (485 ) 1,239 Tax benefit of operating loss carryforwards 11,509 (105,045 ) — Valuation allowances 26,740 97,365 24,040 Income tax benefit $ (96,576 ) $ 67 $ (29,733 ) The significant components of the Company’s deferred tax assets are as follows: December 31, 2017 2016 (In thousands) Deferred tax assets: Net operating loss carryforwards $ 235,852 $ 230,775 Tax credits 20,096 20,973 Stock based compensation 19,611 28,268 Other 26,113 26,889 Total deferred tax assets 301,672 306,905 Valuation allowance (239,536 ) (162,892 ) Total deferred tax assets net of valuation allowance 62,136 144,013 Deferred tax liabilities: Fixed assets $ (568 ) $ (4,997 ) Intangible assets (30,664 ) (81,877 ) Convertible debt (30,904 ) (57,430 ) Indefinite lived intangible assets — (89,701 ) Total deferred tax liabilities (62,136 ) (234,005 ) Net deferred tax liabilities $ — $ (89,992 ) During 2017 and 2016 , the Company recorded a net increase to its valuation allowance of $76.6 million and $95.0 million , respectively. At December 31, 2017 and 2016 , the Company recorded a valuation allowance of $239.5 million and $162.9 million respectively, principally against net operating loss carryforwards in domestic and foreign jurisdictions. The Company considered positive and negative evidence including its level of past and future operating income, the utilization of carryforwards, the status of litigation with respect to the Angiomax patents and other factors in arriving at its decision to recognize its deferred tax assets. The Company continues to evaluate the realizability of its deferred tax assets and liabilities on a periodic basis and will adjust such amounts in light of changing facts and circumstances including, but not limited to, future projections of taxable income, tax legislation, rulings by relevant tax authorities, the progress of ongoing tax audits, the regulatory approval of products currently under development and the extension of patent rights relating to Angiomax. Any changes to the valuation allowance or deferred tax assets in the future would impact the Company’s effective tax rate. On December 22, 2017, the “Tax Cuts and Jobs Act” (TCJA) was enacted which significantly reforms the Internal Revenue Code of 1986, as amended. The TCJA, among other things, reduces the U.S. federal corporate tax rate from 35% to 21%, repeals the corporate alternative minimum tax (AMT), imposes additional limitations on the deductibility of interest, allows for the expensing of capital expenditures, and puts into effect the migration from a “worldwide” system of taxation to a territorial system. As a result of this legislation, the Company remeasured its deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future, which is generally 21%. However, the Company is still analyzing certain aspects of the TCJA and refining its calculations, which could potentially affect the measurement of these balances or potentially give rise to new deferred tax amounts. The provisional amount recorded related to the remeasurement of the Company’s deferred tax balances was $126.5 million which was offset fully by the provisional amount recorded related to the reversal of previously established valuation allowances against these deferred tax balances. The TCJA also permits any remaining AMT tax attribute carryforwards to be used to offset future taxable income and/or be refundable over the next several years. As a result, the Company recognized a provisional benefit of $4.9 million during the year ended December 31, 2017 related to the reversal of a previously established valuation allowance against its AMT tax attribute carryforwards and the related refundable amount has been classified in other assets in the accompanying consolidated balance sheet. In addition, based on its preliminary analysis, the Company does not believe that it has offshore earnings that would be subject to the mandatory transition tax. While the Company has completed its provisional analysis of the income tax effects of the TCJA and recorded a reasonable estimate of such effects, the amounts recorded related to the TCJA may differ, possibly materially, due to, among other things, further refinement of the Company’s calculations, changes in interpretations and assumptions that the Company has made, additional guidance that may be issued by the U.S. Government, and actions and related accounting policy decisions the Company may take as a result of the TCJA. The Company will complete its analysis over a one-year measurement period ending no later than December 22, 2018, and any adjustments during this measurement period will be included in loss from continuing operations as an adjustment to income tax expense/benefit in the reporting period when such adjustments are determined. In 1998 and 2002, the Company experienced a change in ownership as defined in Section 382 of the Internal Revenue Code. However, based on the market value of the Company at such dates, the Company believes that these ownership changes will not significantly impact its ability to use net operating losses or tax credits in the future to offset taxable income. During 2013 the Company acquired the stock of Incline and became the successor of certain net operating losses and tax credit carryforwards. These tax attributes are also subject to a limitation under Internal Revenue Code Section 382 and these amounts, combined with those of the Company in the table below, have been reduced appropriately for such utilization limitations. In addition, utilization of these net operating loss and tax credit carryforwards is dependent upon the Company achieving profitable results. To the extent the Company’s use of net operating loss and tax credit carryforwards is further limited by Section 382 as a result of any future ownership changes, the Company’s income would be subject to cash payments of income tax earlier than it would if the Company was able to fully use its net operating loss and tax credit carryforwards in the U.S. At December 31, 2017 , the Company has federal net operating loss carryforwards available to reduce taxable income and federal research and development tax credit carryforwards available to reduce future tax liabilities. They expire approximately as follows: Year of Expiration Federal Net Federal Research (In thousands) 2027 $ 6,256 $ 840 2028 38,954 2,108 2029 4,755 1,149 2030 1,030 1,162 2031 605 3,097 2032 1,533 3,666 2033 37,209 3,178 2034 4,353 1,861 2035 195,416 752 2036 293,661 1,739 2037 423,531 3,515 $ 1,007,303 $ 23,067 At December 31, 2017 the Company has the following additional carryforwards: Refundable Alternative Minimum Tax Credits of $4.9 million with no expiration date and foreign net operating losses of approximately $49.5 million . The foreign net operating losses expire in varying amounts beginning in 2018 . The Company does not anticipate a significant change in its unrecognized tax benefits in the next twelve months. The Company is no longer subject to federal, state or foreign income tax audits for tax years prior to 2013 . However applicable taxing authorities can review and adjust net operating loss or tax credit carryforwards originating in a closed tax year if utilized in an open tax year. The Company concluded an audit of its 2010 Italy tax filing resulting in a tax assessment of approximately $0.5 million . During 2017, the Company reduced its liability for unrecognized tax benefits by approximately $1.4 million for the difference between the amount previously accrued and the final assessment resulting from that audit. The Company is not under examination by any taxing authorities. However, while tax examinations are often complex, as tax authorities may disagree with the treatment of items reported requiring several years to resolve, the Company believes that it has adequately provided for all uncertain tax provisions for open tax years by tax jurisdiction. The Company classifies interest and penalties related to unrecognized tax benefits in income tax expense. The Company has not accrued any interest or penalties as of December 31, 2017 . The total amount of unrecognized tax benefits that, if recognized, would affect the Company’s effective tax rate was $0.0 million , $1.9 million and $1.9 million as of December 31, 2017 , 2016 and 2015 . A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows: Gross Unrecognized Tax Benefits (In thousands) Balance at January 1, 2015 $ 8,022 Additions related to current year tax positions 61 Balance at December 31, 2015 8,083 Additions related to current year tax positions 193 Balance at December 31, 2016 6,018 Additions related to current year tax positions 708 Reductions for prior year tax positions (2,843 ) Balance at December 31, 2017 $ 3,883 The Company provides income taxes on the earnings of foreign subsidiaries to the extent those earnings are taxable or are expected to be remitted. As of December 31, 2017 , the Company’s accumulated foreign unremitted earnings have been immaterial. The Company’s policy is to invest indefinitely its unremitted foreign earnings outside the United States. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company applies a fair value framework in order to measure and disclose its financial assets and liabilities. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy requires an entity to maximize the use of observable inputs, where available, and minimize the use of unobservable inputs when measuring fair value. There are three levels of inputs that may be used to measure fair value: Level 1 Quoted prices in active markets for identical assets or liabilities. The Company’s Level 1 asset consists of money market investments. Level 2 Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Fair values are determined by utilizing quoted prices for similar assets and liabilities in active markets or other market observable inputs such as interest rates and yield curves. Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company’s Level 3 assets and liabilities consist of the contingent purchase prices associated with the Company’s dispositions and business combinations, respectively. The fair value of certain development or regulatory milestone based contingent purchase prices was determined in a discounted cash flow framework by probability weighting the future contractual payment with management's assessment of the likelihood of achieving these milestones and present valuing them using a risk-adjusted discount rate. Certain sales milestone based payments were determined in a discounted cash flow framework where risk-adjusted revenue scenarios were estimated using Monte Carlo simulation models to compute contractual payments which were present valued using a risk-adjusted discount rate. Financial assets measured at fair value on a nonrecurring basis As part of the purchase and sale agreement with Mallinckrodt, the Company may receive up to an additional $235.0 million in the aggregate following the achievement of certain specified calendar year net sales milestones with respect to net sales of PreveLeak and Raplixa. In evaluating this information, considerable judgment is required to interpret the market data used to develop the assumptions and estimates. The Company utilized the “income method,” which applies a probability weighting that considers the estimated future net sales of each of the respective products to determine the probability that each sale milestone will be met. These projections were based on factors such as relevant market size, patent protection, historical pricing of similar products and expected industry trends. The Company anticipated payment from Mallinckrodt on these sales milestones between 2018 and 2022 with probabilities of achievement ranging from 15% to 85% . The Company also considers qualitative factors such as development of competing drugs, regulatory developments and other qualitative factors. The Company determined the year in which it believes each of the sales milestones will be achieved. The respective milestones were then discounted to the present value using a discount rate of 10% . Any changes to fair value will be recorded if and when the sales milestones are achieved. The Company initially calculated the fair values of these contingent payments to be received from Mallinckrodt as $78.0 million , which are reflected as a contingent purchase price from sale of business on the accompanying consolidated balance sheet. The Company classified these contingent payments as Level 3 assets. Any increases in the carrying amount or impairments of sales milestones would be recognized in operating expenses if and when the milestones are achieved or determined to have no value. On December 31, 2017, the Company decreased the carrying value of the contingent purchase price from the sale of the Hemostasis Business by $63.0 million as a result of the discontinuation of Raplixa by Mallinckrodt. As part of the purchase and sale agreement with Chiesi USA and Chiesi, the Company may receive up to an additional $480.0 million in the aggregate from Chiesi following the achievement of certain specified calendar year net sales milestones with respect to net sales of each of Cleviprex and Kengreal. In evaluating this information, considerable judgment is required to interpret the market data used to develop the assumptions and estimates. The Company utilized a risk adjusted revenue simulation model. In this simulation, the chances of achieving many different revenue levels are estimated and then adjusted to reflect the results of similar products and companies in the market to calculate the fair value of each milestone payment. The breadth of all possible revenue scenarios is captured in an estimate of revenue volatility - a measure that can be estimated from performance of similar companies in the market. The Company estimated revenue volatility as the delivered asset volatility observed in comparable companies’ historical performance, where the delivering asset was based on operational leverage of the Company. Under each of these possible scenarios, different amounts of the sales-based milestone payments are calculated, and the average of the payments across a range of possible scenarios is deemed to be the expected value of the earn-out payments. The Company compared the estimated revenue volatility to the delivered asset volatility to arrive at adjusted revenue volatilities between 30% and 41% . The Company then discounted the expected future value of the earn-out payments using a range of discount rates between 3.1% and 6.9% . The Company calculated the fair values of these contingent payments to be received from Chiesi as $65.7 million , which continue to be reflected as a contingent purchase price from sale of business on the accompanying consolidated balance sheet at December 31, 2017 . The Company classified these contingent payments as Level 3 assets. Any increases in the carrying amount or impairments of sales milestones would be recognized in selling, general and administrative expenses if and when the milestones are achieved or determined to have no value. The Company noted no indicators of impairment on the contingent payments to be received from Chiesi. Financial assets and liabilities measured at fair value on a recurring basis Financial assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. Except for the Company’s Level 2 liabilities which are discussed in Note 9 , “Convertible Senior Notes,” the following table sets forth the Company’s assets and liabilities that are measured at fair value on a recurring basis at December 31, 2017 and 2016 , by level, within the fair value hierarchy: As of December 31, 2017 As of December 31, 2016 Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Balance at December 31, Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Balance at December 31, Assets and Liabilities (Level 1) (Level 2) (Level 3) 2017 (Level 1) (Level 2) (Level 3) 2016 (In thousands) Assets: Cash and cash equivalents $ 12,100 $ — $ 12,100 $ 56,097 $ — $ — $ 56,097 Total assets at fair value $ 12,100 $ — $ — $ 12,100 $ 56,097 $ — $ — $ 56,097 Liabilities: Contingent purchase price $ — $ — $ 19,650 $ 19,650 $ — $ — $ 31,832 $ 31,832 Total liabilities at fair value $ — $ — $ 19,650 $ 19,650 $ — $ — $ 31,832 $ 31,832 There were no transfers of assets between Level 1 and Level 2 of the fair value measurement hierarchy that occurred during 2017 . Level 3 disclosures The Company measures contingent purchase price at fair value based on significant inputs not observable in the market, which causes it to be classified as a Level 3 measurement within the fair value hierarchy. The valuation of contingent purchase price uses assumptions and estimates the Company believes would be made by a market participant in making the same valuation. The Company assesses these assumptions and estimates on an on-going basis as additional data impacting the assumptions and estimates are obtained. Changes in the fair value of contingent purchase price related to updated assumptions and estimates are recognized within selling, general and administrative expenses in the accompanying consolidated statements of operations. The contingent purchase price may change significantly as additional data is obtained, impacting the Company’s assumptions regarding probabilities of successful achievement of related milestones used to estimate the fair value of the liability. In evaluating this information, considerable judgment is required to interpret the market data used to develop the assumptions and estimates. The estimates of fair value may not be indicative of the amounts that could be realized in a current market exchange. Accordingly, the use of different market assumptions and/or different valuation techniques may have a material effect on the estimated fair value amounts, and such changes could materially impact the Company’s results of operations in future periods. The following table provides quantitative information associated with the fair value measurements of the Company’s Level 3 liabilities: Fair Value as of December 31, 2017 Valuation Technique Unobservable Input Range (Weighted Average) (In thousands) Rempex: Contingent purchase price: Event-based milestones $ 19,650 Probability-adjusted discounted cash flow Probabilities of successes 18% - 90% (71%) Period in which milestones are expected to be achieved 2018 - 2024 Discount rate 4.8% - 7.5% Fair Value as of December 31, 2016 Valuation Technique Unobservable Input Range (Weighted Average) (In thousands) Incline: Contingent purchase price $ 1,269 Probability-adjusted discounted cash flow Probabilities of successes 5% Period in which milestones are expected to be achieved 2019 Discount rate 18% Rempex: Contingent purchase price: Event-based milestones $ 16,500 Probability-adjusted discounted cash flow Probabilities of successes 18% - 95% (78%) Discount rate 6.6% - 8.2% Annovation: Contingent purchase price $ 14,063 Probability-adjusted discounted cash flow Probabilities of successes 9% - 50% (34%) Period in which milestones are expected to be achieved 2018 - 2031 Discount rate 6.0% - 10.0% The fair value of the contingent purchase price represents the fair value of the Company’s liability for potential payments under the Company’s acquisition agreements for Incline Therapeutics, Inc. (Incline), Rempex Pharmaceuticals, Inc. (Rempex) and Annovation. There were no changes to the potential future payments under the Company’s acquisition agreements. As of December 31, 2017, the remaining potential future payments to the former equity holders of Rempex were up to $224.3 million . The remaining potential future payments under the Company’s acquisition agreements do not include payments of $175.8 million related to the Ionsys product, which was discontinued and withdrawn in the U.S in June 2017 and which has also been discontinued in Europe, and the MDCO-700 development program, which was discontinued in August 2017. The significant unobservable inputs used in the fair value measurement of the Company’s contingent purchase prices are the probabilities of successful achievement of development, regulatory, and sales milestones that would trigger payments under the Incline, Rempex and Annovation agreements, probabilities as to the periods in which the milestones are expected to be achieved and discount rates. Significant changes in any of the probabilities of success or periods in which milestones will be achieved would result in a significantly higher or lower fair value measurement. The changes in fair value of the Company’s Level 3 contingent purchase price during the year ended December 31, 2017 and 2016 were as follows: December 31, 2017 2016 (In thousands) Balance at beginning of period $ 31,832 $ 18,300 Payments — (10,449 ) Fair value adjustments to contingent purchase prices included in net loss (12,182 ) 23,981 Balance at end of period $ 19,650 $ 31,832 For the year ended December 31, 2017 , changes in the carrying value of the contingent purchase price obligations resulted from changes in the fair value of the contingent consideration due to either the passage of time, changes in discount rates, changes in probabilities of success, or milestone payments. No other changes in valuation techniques or inputs occurred during the year ended December 31, 2017 and 2016 . |
Restructuring
Restructuring | 12 Months Ended |
Dec. 31, 2017 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | Restructuring 2017 Workforce Reduction In June 2017, the Company commenced a voluntary discontinuation and withdrawal of Ionsys from the market and ceased related commercialization activities, with the regulatory authorizations for Ionsys remaining open. Concurrent with this market withdrawal, the Company commenced implementation of a workforce reduction, which resulted in the reduction of 57 employees, representing approximately 15% of the Company’s workforce at that time. The Company recorded a pre-tax charge of approximately $276.9 million associated with the discontinuation and market withdrawal of Ionsys in the United States market, of which $268.1 million was a non-cash impairment charge (including a write-off of inventory), $5.8 million relates to cash severance and $3.0 million relates to other exit costs. The Company has also discontinued Ionsys in the European market. The impacted employees are eligible to receive severance payments in specified amounts, health benefits and outplacement services. The Company has and will record these charges in cost of goods sold, research and development and selling, general and administrative expenses based on responsibilities of the impacted employees. 2016 Workforce Reduction On June 21, 2016, in connection with the sale of the Non-Core ACC Products, the Company commenced implementation of a reorganization intended to improve efficiency and better align the Company’s costs and employment structure with its strategic plans. The reorganization includes a workforce reduction. As a result, the Company reduced its personnel by 162 employees. Upon signing appropriate release agreements, impacted employees were eligible to receive severance payments in specified amounts, health benefits, outplacement services, and an extension of the exercise period for all vested options up to one year from their respective termination date. The Company incurred charges of approximately $17.2 million related to this reorganization in the aggregate. The Company has and will record these charges in cost of goods sold, research and development and selling, general and administrative expenses based on responsibilities of the impacted employees. The following tables set forth details regarding the activities described above during the years ended December 31, 2017 and 2016: Balance as of January 1, 2017 Expenses, Net Cash Noncash Balance as of December 31, 2017 (in thousands) Employee severance and other personnel benefits: 2017 Workforce reduction $ — $ 5,897 $ (5,768 ) $ (129 ) $ — 2016 Workforce reduction 1,854 — (1,038 ) (816 ) — Total $ 1,854 $ 5,897 $ (6,806 ) $ (945 ) $ — Balance as of January 1, 2016 Expenses, Cash Noncash Balance as of December 31, 2016 (in thousands) Employee severance and other personnel benefits: 2016 Workforce reduction $ — $ 17,162 $ (14,697 ) $ (611 ) $ 1,854 Total $ — $ 17,162 $ (14,697 ) $ (611 ) $ 1,854 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The Company’s long-term contractual obligations include commitments and estimated purchase obligations entered into in the normal course of business. These obligations include commitments related to purchases of inventory of the Company’s products, research and development service agreements, operating leases, selling, general and administrative obligations, leased office space for its principal office in Parsippany, New Jersey and additional leased office space in San Diego, California, royalties, milestone payments and other contingent payments due under the Company’s license and acquisition agreements. Future estimated contractual obligations as of December 31, 2017 are: Contractual Obligations (1) (2) Less Than 1 Year 1-3 Years 3-5 Years More Than 5 Years Total (In thousands) Inventory related commitments $ 52,111 $ 16,167 $ — $ — $ 68,278 Research and development 71,115 68,387 34,508 30,409 204,419 Operating leases 7,185 15,029 15,428 27,928 65,570 Selling, general and administrative 3,924 1,379 — — 5,303 Total contractual obligations $ 134,335 $ 100,962 $ 49,936 $ 58,337 $ 343,570 _______________________________________ (1) This table does not include any milestone and royalty payments which may become payable to third parties for which the timing and likelihood of such payments are not known, as discussed below. It also does not include the long-term debt obligations. See Note 9 “Convertible Senior Notes” for further details. (2) This table includes commitments related to the Company’s infectious disease business which was sold on January 5, 2018 and the related commitments were assumed by Melinta. These commitments include $68.3 million of inventory related commitments, $7.3 million for research and development service agreements and $1.8 million for selling, general and administrative obligations. See Note 23 “Discontinued Operations” for further details. All of the inventory related commitments included above are non-cancellable. Included within the inventory related commitments above are purchase commitments for 2018 totaling $66.9 million , $1.2 million and $0.2 million for Vabomere, Minocin and Orbactiv bulk drug substances, respectively. Of the total estimated contractual obligations for research and development and selling, general and administrative activities, $5.3 million are non-cancellable. The Company leases its principal offices in Parsippany, New Jersey. The lease covers 173,146 square feet and expires January 2024. On October 1, 2014, the Company entered into an agreement to lease 63,000 square feet of office space with ARE-SD Region No. 35, LLC for new office and laboratory space in San Diego. This lease has a term of 144 months. The commencement date was February 2017. The lease qualifies for operating lease treatment with recorded annual rent expense from commencement date to expiration. The Company’s remaining obligation for this space is $36.6 million . Approximately 99.7% of the total operating lease commitments above relate to the Company’s principal office building in Parsippany, New Jersey and the Company’s office in San Diego, California. Also included in total operating lease commitments are automobile leases, computer leases and other property leases that the Company entered into while expanding its global infrastructure. Aggregate rent expense under the Company’s property leases in 2017 , 2016 and 2015 was approximately $9.6 million , $7.6 million and $7.3 million , respectively. In addition to the amounts shown in the above table, the Company is contractually obligated to make potential future success-based development, regulatory and commercial milestone payments and royalty payments in conjunction with collaborative agreements or acquisitions it has entered into with third-parties. These contingent payments include royalty payments with respect to Angiomax under the Company’s license agreements with Biogen and HRI, royalty and/or milestone payments with respect to Vabomere, inclisiran, Ionsys, MDCO-700 and Orbactiv. In 2017 , 2016 and 2015 , the Company incurred aggregate royalties to Biogen and HRI of $0.8 million , $0.8 million and $1.8 million , respectively, and royalties to AstraZeneca with respect to Cleviprex of $0.0 million , $0.6 million and $1.3 million . As a result of the sale of its Non-Core ACC Products, the Company no longer owes royalties to AstraZeneca relating to sales of Cleviprex. See Note 22, “Dispositions,” for further details. The Company may have to make these significant contingent cash payments in connection with its acquisition and licensing activities upon the achievement of specified regulatory, sales and other milestones as follows: • $49.4 million due to the former equityholders of Targanta and up to $25.0 million in additional payments to other third parties related to the Targanta transaction; • up to $224.3 million for the Rempex transaction; • up to $170.0 million for the Alnylam license and collaboration agreement with Alnylam; and • $2.2 million for other transaction milestones. Given the nature of these events, it is unclear when, if ever, the Company may be required to pay such amounts. Accordingly, these contingent payments have not been included in the table above as the timing of any future payment is not reasonable estimable. These amounts do not include milestone payments of up to $175.8 million related to the Ionsys product, which was discontinued and withdrawn in the United States in June 2017 and which has also been discontinued in Europe, and the MDCO-700 development program, which was discontinued in August 2017. The milestone payments above include $229.4 million related to the Targanta and Rempex transactions that were included in the sale of the infectious disease business and assumed by Melinta. See Note 23 “Discontinued Operations” for further details. Contingencies The Company may be, from time to time, a party to various disputes and claims arising from normal business activities. The Company accrues for loss contingencies when information available indicates that it is probable that a liability has been incurred and the amount of such loss can be reasonably estimated. The Company is currently party to the other legal proceedings described in Part I, Item 3. Legal Proceedings of this Annual Report on Form 10-K, which are principally patent litigation matters. The Company has assessed such legal proceedings and does not believe that it is probable that a liability has been incurred or that the amount of any potential liability can be reasonably estimated. As a result, the Company did not record any loss contingencies for any of these matters. While it is not possible to determine the outcome of the matters described in Part I, Item 3. Legal Proceedings of this Annual Report on Form 10-K, the Company believes that the resolution of all such matters will not have a material adverse effect on its consolidated financial position or liquidity, but could possibly be material to its consolidated results of operations in any one accounting period. |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2017 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plan | Employee Benefit Plan The Company has an employee savings and retirement plan which is qualified under Section 401(k) of the Internal Revenue Code. The Company made matching contributions in 2017 , 2016 and 2015 of $1.5 million , $1.7 million and $2.5 million , respectively. |
Segment and Geographic Informat
Segment and Geographic Information | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Segment and Geographic Information | Segment and Geographic Information The Company manages its business and operations as one segment and is focused on advancing the treatment of acute and intensive care patients through the delivery of innovative, cost-effective medicines to the worldwide hospital marketplace. The Company allocates resources and assesses financial performance on a consolidated basis. Revenues reported in 2017 , 2016 and 2015 are derived primarily from sales of Angiomax in the United States, including royalty revenue from Sandoz. The geographic segment information provided below is classified based on the major geographic regions in which the Company operates. Long-lived assets are comprised of the Company’s noncurrent assets. Years Ended December 31, 2017 2016 2015 (In thousands) Net revenue: United States $ 37,131 82.9 % $ 131,572 91.9 % $ 275,118 93.4 % Europe 7,239 16.2 % 9,331 6.5 % 16,745 5.7 % Other 419 0.9 % 2,258 1.6 % 2,684 0.9 % Total net revenue $ 44,789 $ 143,161 $ 294,547 Years Ended December 31, 2017 2016 (In thousands) Long-lived assets: United States $ 308,843 99.7 % $ 699,004 99.4 % Europe 836 0.3 % 4,160 0.6 % Total long-lived assets $ 309,679 $ 703,164 |
Collaboration Agreements
Collaboration Agreements | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Collaboration Agreements | Collaboration Agreements Alnylam Pharmaceuticals, Inc. In February 2013, the Company entered into a license and collaboration agreement with Alnylam Pharmaceuticals, Inc. (Alnylam) to develop, manufacture and commercialize therapeutic products targeting the proprotein convertase subtilisin/kexin type 9 (PCSK9) gene, based on certain of Alnylam’s RNA interference (RNAi) technology. Under the terms of the agreement, the Company obtained the exclusive, worldwide right under Alnylam’s technology to develop, manufacture and commercialize PCSK-9 products for the treatment, palliation and/or prevention of all human diseases. Alnylam is responsible for the development costs of the products, subject to an agreed upon limit, until the completion of Phase 1 clinical studies. The Company is responsible for completing and funding the development costs of the products through commercialization, if successful. The Company paid Alnylam $25.0 million in an initial license payment and an additional $10.0 million upon the achievement of a milestone, which payments the Company recorded as research and development expenses in the accompanying consolidated statements of operations. The Company has also agreed to pay up to an aggregate of $180.0 million in success-based development and commercialization milestones. In addition, the Company has agreed to pay specified royalties on net sales of these products. Royalties to Alnylam are payable by the Company on a product-by-product and country-by-country basis until the last to occur of the expiration of patent rights in the applicable country that cover the applicable product, the expiration of non-patent regulatory exclusivities for such product in such country, or the twelfth anniversary of the first commercial sale of the product in such country, subject to reduction in specified circumstances. The Company is also responsible for paying royalties, and in some cases, milestone payments, owed by Alnylam to its licensors with respect to intellectual property covering these products. In December 2014, under the terms of the license and collaboration agreement with Alnylam, Alnylam initiated a Phase 1 clinical trial of ALN-PCSsc in the UK. Upon initiation of the Phase I clinical trial, the Company incurred a $10.0 million milestone. In November 2017, in connection with the first dosing of a subject in a pivotal study, the Company incurred a $20 million milestone. SciClone Pharmaceuticals On December 16, 2014, the Company entered into strategic collaboration agreements with SciClone Pharmaceuticals (SciClone) under which the Company granted SciClone licenses and the exclusive rights to promote, market and sell Angiomax and Cleviprex in China. As a result of the Company’s divestiture of Cleviprex to Chiesi, the Company is no longer a party to the strategic collaboration agreement with SciClone covering Cleviprex. Under the terms of the collaboration regarding Angiomax, SciClone will be responsible for all aspects of commercialization, including pre- and post-launch activities, in the China market (excluding Hong Kong and Macau) and will assist the Company in the registration process in China. The Company has filed in China for marketing approval of Angiomax. SciClone has paid the Company an upfront payment of $10.0 million and agreed to pay a product support services fee and regulatory/commercial success milestone payments of up to an aggregate of $50.5 million and royalties based on net sales of Angiomax in China. Activities under the SciClone agreement were evaluated to determine if they represented a multiple element revenue arrangement. The SciClone agreement includes the following deliverables: (1) an exclusive license to commercialize Angiomax in China, excluding Hong Kong and Macau; (2) the Company’s obligation to conduct research and development activities related to the approvals of Angiomax; and (3) the Company’s obligation to participate on the joint operating committee established under the terms of the SciClone agreement and related subcommittees. All of these deliverables were deemed to have stand-alone value and to meet the criteria to be accounted for as separate units of accounting. Factors considered in this determination included, among other things, the subject of the licenses and the research and development and commercial capabilities of SciClone. Accordingly, each unit will be accounted for separately. For the years ended December 31, 2017 and 2016 , the Company recorded $0.6 million and $0.6 million , respectively, of revenue associated with the SciClone agreement as co-promotion and license income. The Company believes the regulatory approval milestones that may be achieved under the SciClone agreement are consistent with the definition of a milestone. Accordingly, the Company will recognize payments related to the achievement of such milestone, if any, when the applicable milestone is achieved. Factors considered in this determination included scientific and regulatory risks that must be overcome to achieve each milestone, the level of effort and investment required to achieve each milestone, and the monetary value attributed to each milestone. SymBio Pharmaceuticals Limited On October 2, 2015, the Company entered into strategic collaboration with SymBio Pharmaceuticals Limited (SymBio) under which the Company granted SymBio a license and the exclusive rights to promote, market and sell Ionsys in Japan. Under the terms of the collaboration, SymBio will be responsible for all aspects of commercialization, including pre- and post-launch activities, for both products in the Japan market and will assist the Company in the registration process for Ionsys. SymBio has paid the Company an upfront payment of $10.0 million and agreed to pay regulatory/commercial success milestone payments of up to an aggregate of $20.9 million , and royalties based on net sales of Ionsys in Japan. The agreement was terminated in connection with a legal dispute with SymBio effective in the fourth quarter of 2017. Factors considered in the determination of deliverables included, among other things, the subject of the licenses and the research and development and commercial capabilities of Symbio. For the year ended December 31, 2017 and 2016 , the Company recorded $6.9 million and $2.5 million , respectively, of revenue associated with the SymBio agreement as co-promotion and license income. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive (Loss) Income | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Accumulated Other Comprehensive (Loss) Income | Accumulated Other Comprehensive Loss The following table provides a reconciliation of the components of accumulated other comprehensive loss , net of tax, attributable to The Medicines Company: Foreign currency translation adjustment Unrealized (gain) loss on available for sale securities Total (In thousands) Balance at January 1, 2015 $ 2,479 $ 49 $ 2,528 Other comprehensive income before reclassifications 1,445 — 1,445 Total other comprehensive income 1,445 — 1,445 Balance at December 31, 2015 $ 3,924 $ 49 $ 3,973 Other comprehensive income before reclassifications 213 — 213 Amounts reclassified from accumulated other comprehensive income (1) (2) (9,616 ) (49 ) (9,665 ) Total other comprehensive loss (9,403 ) (49 ) (9,452 ) Balance at December 31, 2016 $ (5,479 ) $ — $ (5,479 ) Other comprehensive income before reclassifications 296 296 Total other comprehensive income 296 — 296 Balance at December 31, 2017 $ (5,183 ) $ — $ (5,183 ) (1) Amounts were reclassified to other income in the accompanying consolidated statements of operations. There is generally no tax impact related to foreign currency translation adjustments, as earnings are considered permanently reinvested. In addition, there were no material tax impacts related to unrealized gains or losses on available for sale securities in the periods presented. (2) See Note 23, “Discontinued Operations,” for a discussion of this reclassification of foreign currency translation adjustment. |
Selected Quarterly Financial Da
Selected Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Selected Quarterly Financial Data (Unaudited) | Selected Quarterly Financial Data (Unaudited) The following table presents selected quarterly financial data for the years ended December 31, 2017 and 2016 . Three Months Ended March 31, 2017 June 30, 2017 Sept. 30, 2017 Dec. 31, 2017 March 31, 2016 June 30, 2016 Sept. 30, 2016 Dec. 31, 2016 (1) (2) (3) (In thousands, except per share data) Total net revenues $ 17,465 $ 10,861 $ 7,868 $ 8,595 $ 46,075 $ 48,573 $ 31,084 $ 17,429 Cost of product revenues 9,978 12,490 4,287 20,438 16,042 12,061 18,213 14,337 Total operating expenses 76,879 393,195 71,129 168,682 104,248 120,817 51,881 88,296 Loss from operations (59,414 ) (382,334 ) (63,261 ) (160,087 ) (58,173 ) (72,244 ) (20,797 ) (70,867 ) (Loss) income from continuing operations attributable to The Medicines Company $ (70,996 ) $ (370,065 ) $ (7,218 ) $ (159,416 ) $ (67,125 ) $ 201,912 $ (31,444 ) $ (82,779 ) (Loss) income from discontinued operations, net of tax attributable to The Medicines Company (31,674 ) (27,203 ) (22,957 ) (18,844 ) (25,324 ) (19,470 ) (54,815 ) (40,073 ) Net (loss) income attributable to The Medicines Company $ (102,670 ) $ (397,268 ) $ (30,175 ) $ (178,260 ) $ (92,449 ) $ 182,442 $ (86,259 ) $ (122,852 ) Diluted (loss) earnings per common share attributable to The Medicines Company: (Loss) earnings from continuing operations $ (1.00 ) $ (5.15 ) $ (0.10 ) $ (2.19 ) $ (0.97 ) $ 2.78 $ (0.45 ) $ (1.17 ) (Loss) income from discontinued operations (0.45 ) (0.38 ) (0.31 ) (0.26 ) (0.37 ) (0.27 ) (0.78 ) (0.57 ) Diluted loss per share $ (1.45 ) $ (5.53 ) $ (0.41 ) $ (2.45 ) $ (1.34 ) $ 2.51 $ (1.23 ) $ (1.74 ) ______________________________________ (1) In June 2017, we commenced a voluntary discontinuation and withdrawal of Ionsys from the market and ceased related commercialization activities, with the regulatory authorizations for Ionsys remaining open. Concurrent with this market withdrawal, the Company commenced a workforce reduction, which resulted in the reduction of 57 employees, representing approximately 15% of the Company’s workforce at that time. The Company recorded a pre-tax charge of approximately $276.9 million associated with the discontinuation and market withdrawal of Ionsys in the United States market. In August 2017, the Company announced that it discontinued the clinical development program for MDCO-700 and recorded the following non-cash adjustments during the second quarter of 2017: $65.0 million of asset impairment charges to in-process research and development (IPR&D) acquired from Annovation, a $14.7 million decrease in the carrying value of the contingent purchase price to an estimated fair value of zero , and a $23.0 million benefit for income taxes due to a reduction in the Company’s recorded valuation allowance against its deferred tax assets as a result of the impairment charge. (2) In the fourth quarter of 2017, the Company decreased the carrying value of the contingent purchase price from the sale of the Hemostasis Business by $63.0 million as a result of the discontinuation of Raplixa by Mallinckrodt. (3) On June 21, 2016, the Company completed the sale of its Non-Core ACC Products pursuant to the purchase and sale agreement dated May 9, 2016 by and among the Company, Chiesi USA and Chiesi. As a result of this sale, the Company realized a gain on sale of business of $288.3 million . |
Dispositions
Dispositions | 12 Months Ended |
Dec. 31, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Dispositions | Dispositions On June 21, 2016, the Company completed the sale of its Non-Core ACC Products pursuant to the purchase and sale agreement dated May 9, 2016 by and among the Company, Chiesi USA and Chiesi. At the completion of the sale, the Company received approximately $263.8 million in cash, which included the value of product inventory, and may receive up to an additional $480.0 million in the aggregate following the achievement of certain specified calendar year net sales milestones with respect to net sales of each of Cleviprex and Kengreal. The following table presents the consideration received, major classes of assets sold and the gain recognized on the sale of the Non-Core ACC Products: (in thousands) Sale price: Cash $ 263,807 Contingent purchase price from sale of business 65,700 Total sale price 329,507 Assets: Inventory 2,184 Intangibles 5,210 Goodwill 33,812 Total assets sold 41,206 Gain on sale of business $ 288,301 The Company recognized a gain on sale of business of approximately $288.3 million in 2016 in continuing operations in the accompanying consolidated statements of operations. Disposition related costs during 2016 of approximately $7.9 million for advisory, legal and regulatory fees incurred in connection with the sale of the Non-Core ACC Products were recorded in selling, general and administrative expenses in the accompanying consolidated statements of operations. See Note 14, “Fair Value Measurements,” for further details on the contingent purchase price from sale of businesses. Discontinued Operations Sale of Infectious Disease Business On January 5, 2018, the Company completed the sale of its infectious disease business, consisting of the products Vabomere, Orbactiv and Minocin IV and line extensions thereof, and substantially all of the assets related thereto, other than certain pre-clinical assets, to Melinta. At the completion of the sale, the Company received approximately $166.4 million and 3,313,702 shares of Melinta common stock having a market value, based on Melinta's closing share price on January 5, 2018, of approximately $54.5 million . In addition, the Company is entitled to receive (i) a cash payment payable 12 months following the closing of the Transaction equal to $25.0 million ; (ii) a cash payment payable 18 months following the closing of the Transaction equal to $25.0 million ; and (iii) tiered royalty payments of 5% to 25% on worldwide net sales of (a) Vabomere and (b) Orbactiv and Minocin IV, collectively. The fair value of the total consideration received was estimated to be approximately $500.0 million . As a result of the transaction, the Company accounted for the assets and liabilities of the infectious disease business that were sold as held for sale at December 31, 2017. Financial results of the infectious disease business are presented as “ Loss from discontinued operations, net of tax ” on the accompanying consolidated statements of operations for years ended 2017 , 2016 and 2015 . Assets and liabilities of the infectious disease business to be disposed of are presented as “Current assets held for sale,” “Noncurrent assets held for sale,” “Current liabilities held for sale,” and “Noncurrent liabilities held for sale” on the accompanying consolidated balance sheet as of December 31, 2017 and 2016. The following table presents key financial results of the infectious disease business included in “ Loss from discontinued operations, net of tax ” for years ended 2017 , 2016 and 2015 . Year Ended December 31, 2017 2016 2015 (In thousands) Net product revenues $ 34,622 $ 24,673 $ 14,460 Operating expenses: Cost of product revenue 20,060 10,693 15,945 Research and development 39,984 47,155 33,218 Selling, general and administrative 74,346 106,670 52,643 Total operating expenses 134,390 164,518 101,806 Loss from operations (99,768 ) (139,845 ) (87,346 ) Other expense, net (906 ) (19 ) 212 Loss from discontinued operations before income taxes (100,674 ) (139,864 ) (87,134 ) Provision (benefit) for income taxes 4 2 (10 ) Loss from discontinued operations, net of tax $ (100,678 ) $ (139,866 ) $ (87,124 ) The following table presents the major classes of assets and liabilities at December 31, 2017 and 2016 related to the infectious disease business which were reclassified as held for sale: December 31, December 31, 2017 2016 (In thousands) Assets: Accounts receivable, net $ 9,595 $ 3,916 Inventory 41,412 42,411 Other receivables 2,740 4,259 Intangibles, net 282,398 — Goodwill 55,057 — Current assets held for sale 391,202 50,586 Intangibles, net — 293,036 Goodwill — 55,057 Total assets held for sale $ 391,202 $ 398,679 Liabilities: Accounts payable $ 1,127 $ 7,872 Accrued expenses 22,945 21,686 Contingent purchase price – current 24,650 55,000 Deferred Revenue 723 2,467 Contingent purchase price – noncurrent 11,135 — Current liabilities held for sale 60,580 87,025 Contingent purchase price – noncurrent — 50,457 Total liabilities held for sale $ 60,580 $ 137,482 Depreciation and amortization was ceased upon determination that the held for sale criteria were met in the fourth quarter of 2017. The significant cash flow items from discontinued operations for years ended 2017 , 2016 and 2015 were as follows: Year Ended December 31, 2017 2016 2015 (In thousands) Amortization from discontinued operations $ 10,638 $ 17,858 $ 6,798 Changes in contingent purchase price (3,456 ) 53,249 1 Reserve for excess or obsolete inventory (435 ) (2,066 ) 4,228 Payments on contingent purchase price (63,066 ) (10,449 ) (18 ) In connection with the divestiture of the infectious disease business unit to Melinta, the Company commenced a workforce reduction, which resulted in the reduction of 36 employees, representing approximately 10% of its workforce. Acquisitions prior to Sale of Hemostasis Business Recothrom In February 2013, pursuant to a master transaction agreement with Bristol-Myers Squibb Company (BMS), the Company acquired the right to sell, distribute and market Recothrom on a global basis for the collaboration term and BMS transferred to the Company certain limited assets exclusively related to Recothrom, primarily the biologics license application for Recothrom and certain related regulatory assets. BMS also granted to the Company, under the master transaction agreement, an option to purchase from BMS and its affiliates, following the expiration or earlier termination of the collaboration term, certain other assets, including certain patent and trademark rights, contracts, inventory, equipment and related books and records, held by BMS which are exclusively related to Recothrom. On February 6, 2015, the Company completed the acquisition of the remaining assets held by BMS which were exclusively related to Recothrom. Upon closing the exercise of the option in February 2015, the Company paid BMS approximately $132.4 million in the aggregate, including approximately $44.0 million for inventory and reclassified the value of the purchase option and additional amounts paid to BMS to Developed Product Rights and commenced amortizing. Sale of Hemostasis Business On February 1, 2016, the Company completed the sale of its Hemostasis Business to Mallinckrodt pursuant to the purchase and sale agreement dated December 18, 2015 between the Company and Mallinckrodt. At the completion of the sale, the Company received approximately $174.1 million in cash from Mallinckrodt, and may receive up to an additional $235.0 million in the aggregate following the achievement of certain specified calendar year net sales milestones with respect to net sales of PreveLeak and Raplixa. As a result of the transaction, the Company accounted for the assets and liabilities of the Hemostasis Business that were sold as held for sale at December 31, 2015. As a result of the classification as held for sale, the Company recorded impairment charges of $133.3 million , including $24.5 million related to goodwill, to reduce the Hemostasis Business disposal group’s carrying value to its estimated fair value, less costs to sell for the year ended December 31, 2015. The determination of fair value for these assets was based on the best information available that resided within Level 3 of the fair value hierarchy, including internal cash flow estimates discounted at an appropriate interest rate. Financial results of the Hemostasis Business are presented as “ Loss from discontinued operations, net of tax ” on the accompanying consolidated statements of operations for years ended 2017 , 2016 and 2015 . The following table presents key financial results of the Hemostasis business included in “ Loss from discontinued operations, net of tax ” for years ended December 31, 2016 and 2015 . Year Ended December 31, 2016 2015 (In thousands) Net product revenues $ 1,275 $ 65,754 Operating expenses: Cost of product revenue 1,424 75,889 Research and development 90 7,568 Selling, general and administrative 542 560 Impairment — 133,266 Total operating expenses 2,056 217,283 Income (loss) from operations (781 ) (151,529 ) Gain from sale of business 1,004 — Other expense, net (39 ) (745 ) Income (loss) from discontinued operations before income taxes 184 (152,274 ) Benefit for income taxes — (21,448 ) Loss from discontinued operations, net of tax $ 184 $ (130,826 ) Cumulative translation adjustment (CTA) gains or losses of foreign subsidiaries related to divested businesses are reclassified into income once the liquidation of the respective foreign subsidiaries is substantially complete. At the completion of the sale of the Hemostasis Business, the Company reclassified $9.6 million , net of tax, of CTA gains from accumulated comprehensive loss to the Company’s results of discontinued operations. Of this amount, $8.4 million was included in the impairment loss recorded to reduce the Hemostasis Business disposal group’s carrying value to its estimated fair value, less costs to sell as of December 31, 2015 and $1.2 million was included in “Gain from sale of business” for the year ended December 31, 2016. Cost of product revenue for the three months ended September 30, 2015 included a charge of $25.8 million to reduce the carrying value of the product rights associated with PreveLeak to their estimated fair value as a result of a reduction in expected future cash flows. Depreciation and amortization was ceased upon determination that the held for sale criteria were met in the fourth quarter of 2015. The significant cash flow items from discontinued operations for years ended December 31, 2016 and 2015 were as follows: Year Ended December 31, 2016 2015 (In thousands) Depreciation from discontinued operations $ — $ 371 Amortization from discontinued operations — 42,278 Gain on sale of business (1,004 ) — Asset impairment charges — 25,800 Reserve for excess or obsolete inventory — 876 Change in contingent consideration obligation — 8,743 Proceeds from sale of businesses 174,068 — Capital expenditures — 738 |
Discontinued Operations
Discontinued Operations | 12 Months Ended |
Dec. 31, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | Dispositions On June 21, 2016, the Company completed the sale of its Non-Core ACC Products pursuant to the purchase and sale agreement dated May 9, 2016 by and among the Company, Chiesi USA and Chiesi. At the completion of the sale, the Company received approximately $263.8 million in cash, which included the value of product inventory, and may receive up to an additional $480.0 million in the aggregate following the achievement of certain specified calendar year net sales milestones with respect to net sales of each of Cleviprex and Kengreal. The following table presents the consideration received, major classes of assets sold and the gain recognized on the sale of the Non-Core ACC Products: (in thousands) Sale price: Cash $ 263,807 Contingent purchase price from sale of business 65,700 Total sale price 329,507 Assets: Inventory 2,184 Intangibles 5,210 Goodwill 33,812 Total assets sold 41,206 Gain on sale of business $ 288,301 The Company recognized a gain on sale of business of approximately $288.3 million in 2016 in continuing operations in the accompanying consolidated statements of operations. Disposition related costs during 2016 of approximately $7.9 million for advisory, legal and regulatory fees incurred in connection with the sale of the Non-Core ACC Products were recorded in selling, general and administrative expenses in the accompanying consolidated statements of operations. See Note 14, “Fair Value Measurements,” for further details on the contingent purchase price from sale of businesses. Discontinued Operations Sale of Infectious Disease Business On January 5, 2018, the Company completed the sale of its infectious disease business, consisting of the products Vabomere, Orbactiv and Minocin IV and line extensions thereof, and substantially all of the assets related thereto, other than certain pre-clinical assets, to Melinta. At the completion of the sale, the Company received approximately $166.4 million and 3,313,702 shares of Melinta common stock having a market value, based on Melinta's closing share price on January 5, 2018, of approximately $54.5 million . In addition, the Company is entitled to receive (i) a cash payment payable 12 months following the closing of the Transaction equal to $25.0 million ; (ii) a cash payment payable 18 months following the closing of the Transaction equal to $25.0 million ; and (iii) tiered royalty payments of 5% to 25% on worldwide net sales of (a) Vabomere and (b) Orbactiv and Minocin IV, collectively. The fair value of the total consideration received was estimated to be approximately $500.0 million . As a result of the transaction, the Company accounted for the assets and liabilities of the infectious disease business that were sold as held for sale at December 31, 2017. Financial results of the infectious disease business are presented as “ Loss from discontinued operations, net of tax ” on the accompanying consolidated statements of operations for years ended 2017 , 2016 and 2015 . Assets and liabilities of the infectious disease business to be disposed of are presented as “Current assets held for sale,” “Noncurrent assets held for sale,” “Current liabilities held for sale,” and “Noncurrent liabilities held for sale” on the accompanying consolidated balance sheet as of December 31, 2017 and 2016. The following table presents key financial results of the infectious disease business included in “ Loss from discontinued operations, net of tax ” for years ended 2017 , 2016 and 2015 . Year Ended December 31, 2017 2016 2015 (In thousands) Net product revenues $ 34,622 $ 24,673 $ 14,460 Operating expenses: Cost of product revenue 20,060 10,693 15,945 Research and development 39,984 47,155 33,218 Selling, general and administrative 74,346 106,670 52,643 Total operating expenses 134,390 164,518 101,806 Loss from operations (99,768 ) (139,845 ) (87,346 ) Other expense, net (906 ) (19 ) 212 Loss from discontinued operations before income taxes (100,674 ) (139,864 ) (87,134 ) Provision (benefit) for income taxes 4 2 (10 ) Loss from discontinued operations, net of tax $ (100,678 ) $ (139,866 ) $ (87,124 ) The following table presents the major classes of assets and liabilities at December 31, 2017 and 2016 related to the infectious disease business which were reclassified as held for sale: December 31, December 31, 2017 2016 (In thousands) Assets: Accounts receivable, net $ 9,595 $ 3,916 Inventory 41,412 42,411 Other receivables 2,740 4,259 Intangibles, net 282,398 — Goodwill 55,057 — Current assets held for sale 391,202 50,586 Intangibles, net — 293,036 Goodwill — 55,057 Total assets held for sale $ 391,202 $ 398,679 Liabilities: Accounts payable $ 1,127 $ 7,872 Accrued expenses 22,945 21,686 Contingent purchase price – current 24,650 55,000 Deferred Revenue 723 2,467 Contingent purchase price – noncurrent 11,135 — Current liabilities held for sale 60,580 87,025 Contingent purchase price – noncurrent — 50,457 Total liabilities held for sale $ 60,580 $ 137,482 Depreciation and amortization was ceased upon determination that the held for sale criteria were met in the fourth quarter of 2017. The significant cash flow items from discontinued operations for years ended 2017 , 2016 and 2015 were as follows: Year Ended December 31, 2017 2016 2015 (In thousands) Amortization from discontinued operations $ 10,638 $ 17,858 $ 6,798 Changes in contingent purchase price (3,456 ) 53,249 1 Reserve for excess or obsolete inventory (435 ) (2,066 ) 4,228 Payments on contingent purchase price (63,066 ) (10,449 ) (18 ) In connection with the divestiture of the infectious disease business unit to Melinta, the Company commenced a workforce reduction, which resulted in the reduction of 36 employees, representing approximately 10% of its workforce. Acquisitions prior to Sale of Hemostasis Business Recothrom In February 2013, pursuant to a master transaction agreement with Bristol-Myers Squibb Company (BMS), the Company acquired the right to sell, distribute and market Recothrom on a global basis for the collaboration term and BMS transferred to the Company certain limited assets exclusively related to Recothrom, primarily the biologics license application for Recothrom and certain related regulatory assets. BMS also granted to the Company, under the master transaction agreement, an option to purchase from BMS and its affiliates, following the expiration or earlier termination of the collaboration term, certain other assets, including certain patent and trademark rights, contracts, inventory, equipment and related books and records, held by BMS which are exclusively related to Recothrom. On February 6, 2015, the Company completed the acquisition of the remaining assets held by BMS which were exclusively related to Recothrom. Upon closing the exercise of the option in February 2015, the Company paid BMS approximately $132.4 million in the aggregate, including approximately $44.0 million for inventory and reclassified the value of the purchase option and additional amounts paid to BMS to Developed Product Rights and commenced amortizing. Sale of Hemostasis Business On February 1, 2016, the Company completed the sale of its Hemostasis Business to Mallinckrodt pursuant to the purchase and sale agreement dated December 18, 2015 between the Company and Mallinckrodt. At the completion of the sale, the Company received approximately $174.1 million in cash from Mallinckrodt, and may receive up to an additional $235.0 million in the aggregate following the achievement of certain specified calendar year net sales milestones with respect to net sales of PreveLeak and Raplixa. As a result of the transaction, the Company accounted for the assets and liabilities of the Hemostasis Business that were sold as held for sale at December 31, 2015. As a result of the classification as held for sale, the Company recorded impairment charges of $133.3 million , including $24.5 million related to goodwill, to reduce the Hemostasis Business disposal group’s carrying value to its estimated fair value, less costs to sell for the year ended December 31, 2015. The determination of fair value for these assets was based on the best information available that resided within Level 3 of the fair value hierarchy, including internal cash flow estimates discounted at an appropriate interest rate. Financial results of the Hemostasis Business are presented as “ Loss from discontinued operations, net of tax ” on the accompanying consolidated statements of operations for years ended 2017 , 2016 and 2015 . The following table presents key financial results of the Hemostasis business included in “ Loss from discontinued operations, net of tax ” for years ended December 31, 2016 and 2015 . Year Ended December 31, 2016 2015 (In thousands) Net product revenues $ 1,275 $ 65,754 Operating expenses: Cost of product revenue 1,424 75,889 Research and development 90 7,568 Selling, general and administrative 542 560 Impairment — 133,266 Total operating expenses 2,056 217,283 Income (loss) from operations (781 ) (151,529 ) Gain from sale of business 1,004 — Other expense, net (39 ) (745 ) Income (loss) from discontinued operations before income taxes 184 (152,274 ) Benefit for income taxes — (21,448 ) Loss from discontinued operations, net of tax $ 184 $ (130,826 ) Cumulative translation adjustment (CTA) gains or losses of foreign subsidiaries related to divested businesses are reclassified into income once the liquidation of the respective foreign subsidiaries is substantially complete. At the completion of the sale of the Hemostasis Business, the Company reclassified $9.6 million , net of tax, of CTA gains from accumulated comprehensive loss to the Company’s results of discontinued operations. Of this amount, $8.4 million was included in the impairment loss recorded to reduce the Hemostasis Business disposal group’s carrying value to its estimated fair value, less costs to sell as of December 31, 2015 and $1.2 million was included in “Gain from sale of business” for the year ended December 31, 2016. Cost of product revenue for the three months ended September 30, 2015 included a charge of $25.8 million to reduce the carrying value of the product rights associated with PreveLeak to their estimated fair value as a result of a reduction in expected future cash flows. Depreciation and amortization was ceased upon determination that the held for sale criteria were met in the fourth quarter of 2015. The significant cash flow items from discontinued operations for years ended December 31, 2016 and 2015 were as follows: Year Ended December 31, 2016 2015 (In thousands) Depreciation from discontinued operations $ — $ 371 Amortization from discontinued operations — 42,278 Gain on sale of business (1,004 ) — Asset impairment charges — 25,800 Reserve for excess or obsolete inventory — 876 Change in contingent consideration obligation — 8,743 Proceeds from sale of businesses 174,068 — Capital expenditures — 738 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events As previously announced, the Company is implementing a series of workforce reductions to focus on inclisiran, improve efficiencies and better align costs and structure. Through February 27, 2018 our workforce restructuring plan has been finalized and communicated to substantially all employees who will be impacted. The Company estimates it will incur approximately $20 million to $26 million related to cash severance and other employee costs associated with these workforce reductions. |
Significant Accounting Polici32
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. The Company records net income (loss) attributable to non-controlling interest in the Company’s consolidated financial statements equal to percentage of ownership interest retained in the respective operations by the non-controlling parties. The Company has no unconsolidated subsidiaries. |
Use of Estimates | The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, costs, expenses and accumulated other comprehensive income/(loss) that are reported in the consolidated financial statements and accompanying disclosures. Actual results may be different. |
Investments | The Company accounts for its common stock investment in a minority interest of a company that does not have a readily determinable fair value over which it does not exercise significant influence on the cost method. Under the cost method, an investment is carried at cost until it is sold or there is evidence that changes in the business environment or other facts and circumstances suggest it may be other than temporarily impaired. Investments in which the Company has at least a 20%, but not more than a 50%, interest are generally accounted for under the equity method. These non-marketable securities have been classified as investments and included in other assets on the accompanying consolidated balance sheets. The Company’s proportionate share of the operating results is recorded as loss in equity investment in the Company’s consolidated statement of operations. On February 2, 2015, the Company completed the acquisition of Annovation, and Annovation became the Company’s wholly owned subsidiary. See Note 6 “Acquisition” for further details. |
Inventory | The Company records inventory upon the transfer of title from the Company’s vendors. Inventory is stated at the lower of cost or net realizable value and valued using first-in, first-out methodology. Angiomax and Ionsys bulk substances are classified as raw materials and their costs are determined using acquisition costs from the Company’s contract manufacturers. The Company records work-in-progress costs of filling, finishing and packaging against specific product batches. |
Fixed Assets | Fixed assets are stated at cost. Depreciation is provided using the straight-line method based on estimated useful lives or, in the case of leasehold improvements, over the lesser of the useful lives or the lease terms. Repairs and maintenance costs are expensed as incurred. |
Treasury Stock | Treasury stock is recognized at the cost to reacquire the shares. Shares issued from treasury are recognized utilizing the first-in first-out method. |
Intangible Assets with Definite Useful Lives | Intangible assets with definite useful lives are amortized over their estimated useful lives and reviewed for impairment if certain events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. |
In-Process Research and Development | The cost of in-process research and development (IPR&D) acquired directly in a transaction other than a business combination is capitalized if the projects have an alternative future use; otherwise it is expensed. The fair values of IPR&D projects acquired in business combinations are capitalized. Several methods may be used to determine the estimated fair value of the IPR&D acquired in a business combination. The Company utilizes the “income method,” which applies a probability weighting that considers the risk of development and commercialization to the estimated future net cash flows that are derived from projected sales revenues and estimated costs. These projections are based on factors such as relevant market size, patent protection, historical pricing of similar products and expected industry trends. The estimated future net cash flows are then discounted to the present value using an appropriate discount rate. This analysis is performed for each project independently. The Company also considers qualitative factors such as development of competing drugs, status in the development cycle of the product, regulatory developments and other qualitative factors. These assets are treated as indefinite-lived intangible assets until completion or abandonment of the projects, at which time the assets are amortized over the remaining useful life or written off, as appropriate. These are tested at least annually or when a triggering event occurs that could indicate a potential impairment. |
Goodwill | Goodwill represents the excess consideration in a business combination over the fair value of identifiable net assets acquired. Goodwill is not amortized, but subject to impairment testing at least annually or when a triggering event occurs that could indicate a potential impairment. The Company determines whether goodwill may be impaired by comparing the carrying value of its reporting unit to the fair value of its reporting unit. A reporting unit is defined as an operating segment or one level below an operating segment. |
Contingent Purchase Price From Sale of Business | The Company has contingent assets for certain specified calendar year net sales milestones as part of the sales of the Hemostasis Business and the Non-Core ACC Products. In determining the fair value of these sales milestones, considerable judgment is required to interpret the market data used to develop the assumptions and estimates. The Company utilizes either the “income method” or a risk adjusted revenue simulation model. The income method applies a probability weighting that considers the estimated future net sales of each of the respective products to determine the probability that each sale milestone will be met. These projections were based on factors such as relevant market size, patent protection, historical pricing of similar products and expected industry trends. In a risk adjusted revenue simulation model, the chances of achieving many different revenue levels are estimated and then adjusted to reflect the results of similar products and companies in the market to calculate the fair value of each milestone payment. The breadth of all possible revenue scenarios is captured in an estimate of revenue volatility - a measure that can be estimated from performance of similar companies in the market. The Company estimated revenue volatility as the delivered asset volatility observed in comparable companies’ historical performance, where the delivering asset was based on operational leverage of the Company. Under each of these possible scenarios, different amounts of the sales-based milestone payments are calculated, and the average of the payments across a range of possible scenarios is deemed to be the expected value of the earn-out payments. The Company will recognize any increases in the carrying amount or impairments of the contingent purchase price if and when the milestones are achieved or determined to have no value. In the fourth quarter of 2017, the Company decreased the carrying value of the contingent purchase price from the sale of the Hemostasis Business by $63.0 million to an estimated fair value of zero, which is a Level 3 fair value measurement, as a result of the discontinuation of Raplixa by Mallinckrodt. The Company noted no indicators of impairment on the carrying amounts of the remaining contingent assets. In addition, the Company determined that the fair values of these contingent payments to be received from the buyers are not readily determinable at December 31, 2017, as the estimated future net sales of each of the respective products are determined by the future actions of the buyers. |
Long-Lived Assets | Long-lived assets, such as property, plant and equipment and certain other long-term assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset or asset group to the estimated undiscounted future cash flows expected to be generated by the asset or asset group. If the carrying amount of the assets exceed their estimated future undiscounted net cash flows, an impairment charge is recognized for the amount by which the carrying amount of the assets exceed the fair value of the assets. |
Contingent Purchase Price from Business Combinations | Subsequent to the acquisition date, the Company measures the fair value of the acquisition-related contingent consideration at each reporting period, with changes in fair value recorded in selling, general and administrative in the accompanying consolidated statements of operations. Changes to contingent consideration obligations can result from adjustments to discount rates and periods, updates in the assumed achievement or timing of any development or commercial milestone or changes in the probability of certain clinical events, the passage of time and changes in the assumed probability associated with regulatory approval. The fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 measurement as defined in fair value measurement accounting. |
Risks and Uncertainties | The Company is subject to risks common to companies in the pharmaceutical industry including, but not limited to, uncertainties related to commercialization of products, regulatory approvals, dependence on key products, dependence on key customers and suppliers, and protection of intellectual property rights. |
Concentrations of Credit Risk | Financial instruments that potentially subject the Company to concentration of credit risk include cash, cash equivalents and accounts receivable. The Company believes it minimizes its exposure to potential concentrations of credit risk by placing investments with high quality institutions. |
Contingencies | The Company may be, from time to time, a party to various disputes and claims arising from normal business activities. The Company continually assesses litigation to determine if an unfavorable outcome would lead to a probable loss or reasonably possible loss which could be estimated. In accordance with the guidance of the FASB on accounting for contingencies, the Company accrues for all contingencies at the earliest date at which the Company deems it probable that a liability has been incurred and the amount of such liability can be reasonably estimated. If the estimate of a probable loss is a range and no amount within the range is more likely than another, the Company accrues the minimum of the range. In the cases where the Company believes that a reasonably possible loss exists, the Company discloses the facts and circumstances of the litigation, including an estimable range, if possible. |
Revenue Recognition | International Distributors. Under the Company’s agreements with its primary international distributors, the Company sells Angiomax to these distributors at a fixed price. The established price is typically determined once per year, prior to the first shipment of Angiomax to the distributor each year. The minimum selling price used in determining the price is 50% of the average net unit selling price. Product Sales. The Company distributes branded Angiomax in the United States through a sole source distribution model with Integrated Commercialization Solutions (ICS). The Company sold Cleviprex, Kengreal and ready-to-use Argatroban and Minocin, Orbactiv and Vabomere under this model up until the sale of these products to Chiesi and Melinta, respectively. See Note 22, “Dispositions,” for further details regarding the products sold to Chiesi and Note 23, “Discontinued Operations,” for further details regarding the products sold to Melinta. ICS then primarily sells branded Angiomax, and previously sold the other product, to a limited number of national medical and pharmaceutical wholesalers with distribution centers located throughout the United States. Prior to July 1, 2015, sales of Angiomax in the United States were recognized upon shipment to ICS. As a result of the entrance of generic products in the marketplace beginning in the third quarter of 2015, the Company could not reasonably estimate its chargebacks with respect to branded Angiomax between July 1, 2015 and August 30, 2017, and sales of branded Angiomax in the United States were recognized under a deferred revenue model during that period. Under the deferred revenue model, the Company did not recognize revenue upon product shipment of branded Angiomax to ICS. Instead, upon product shipment, the Company invoiced ICS, recorded deferred revenue at gross invoice sales price, classified the cost basis of the product held by ICS as finished goods inventory held by others and included such cost basis amount within prepaid expenses and other current assets on the consolidated balance sheets. The Company recognized revenue when hospitals purchased the products and the transaction consideration became fixed or determinable. Beginning September 1, 2017, the Company had sufficient market information to reasonably estimate its chargebacks, returns and other adjustments to gross revenues associated with branded Angiomax and recognizes sales upon shipment to ICS. This change in estimate did not materially impact net product revenues or cost of product revenues for the year ended December 31, 2017, and is not expected to materially impact net product revenues or costs of product revenues in future periods. Effective July 2, 2015, the Company entered into a supply and distribution agreement with Sandoz under which it has granted Sandoz the exclusive right to sell in the United States an authorized generic of Angiomax (bivalirudin). The Company recognizes sales of generic Angiomax to Sandoz under a deferred revenue model. In accordance with the Sandoz agreement, the Company receives a royalty based on Sandoz’s gross margin, as defined in the agreement, of the authorized generic product sold by Sandoz to hospitals. The Company recognizes royalty revenue on an accrual basis in the period it is reported by Sandoz. During 2017 and 2016 , the Company recognized royalty revenue of $25.8 million and $71.2 million , respectively. The Company’s agreement with ICS provides that ICS will be the Company’s exclusive distributor of branded Angiomax and acute care generic products in the United States. Under the terms of this fee-for-service agreement, ICS places orders with the Company for sufficient quantities to maintain an appropriate level of inventory based on the Company’s customers’ historical purchase volumes. ICS assumes all credit and inventory risks, is subject to the Company’s standard return policy and has sole responsibility for determining the prices at which it sells these products, subject to specified limitations in the agreement. The agreement terminates on February 28, 2019 and will automatically renew for additional one -year periods unless either party gives notice at least 90 days prior to the automatic extension. Either party may terminate the agreement at any time and for any reason upon 180 days’ prior written notice to the other party. In Europe, the Company markets and sells Angiomax, which the Company markets under the trade name Angiox. The Company recognizes revenue from such sales when hospitals purchase the product. The Company had deferred revenue of $0.2 million and $1.7 million as of December 31, 2017 and 2016 , respectively, associated with sales of Angiomax to wholesalers outside of the United States. The Company does not recognize revenue from product sales until there is persuasive evidence of an arrangement, delivery has occurred, the price is fixed or determinable, the buyer is obligated to pay the Company, the obligation to pay is not contingent on resale of the product, the buyer has economic substance apart from the Company, the Company has no obligation to bring about the sale of the product, the amount of returns can be reasonably estimated and collectability is reasonably assured. The Company records allowances for chargebacks and other discounts or accruals for product returns, rebates and fee-for-service charges at the time of sale, and reports revenue net of such amounts. In determining the amounts of certain allowances and accruals, the Company must make significant judgments and estimates. For example, in determining these amounts, the Company estimates hospital demand, buying patterns by hospitals and group purchasing organizations from wholesalers and the levels of inventory held by wholesalers and by ICS. Making these determinations involves estimating whether trends in past wholesaler and hospital buying patterns will predict future product sales. The Company receives data periodically from ICS and wholesalers on inventory levels and levels of hospital purchases and the Company considers this data in determining the amounts of these allowances and accruals. The specific considerations the Company uses in estimating these amounts are as follows: • Product returns. The Company’s customers have the right to return any unopened product during the 18 -month period beginning six months prior to the labeled expiration date and ending 12 months after the labeled expiration date. As a result, in calculating the accrual for product returns, the Company must estimate the likelihood that product sold might not be used within six months of expiration and analyze the likelihood that such product will be returned within 12 months after expiration. The Company considers all of these factors and adjusts the accrual periodically throughout each quarter to reflect actual experience. When customers return product, they are generally given credit against amounts owed. The amount credited is charged to the Company’s product returns accrual. In estimating the likelihood of product being returned, the Company relies on information from ICS and wholesalers regarding inventory levels, measured hospital demand as reported by third-party sources and internal sales data. The Company also considers the past buying patterns of ICS and wholesalers, the estimated remaining shelf life of product previously shipped, the expiration dates of product currently being shipped, price changes of competitive products and introductions of generic products. At December 31, 2017 and 2016 , the Company’s accrual for product returns was $4.3 million and $1.6 million , respectively. • Chargebacks and rebates. Although the Company primarily sells Angiomax to ICS in the United States, the Company typically enters into agreements with hospitals, either directly or through group purchasing organizations acting on behalf of their hospital members, in connection with the hospitals’ purchases of Angiomax. Based on these agreements, most of the Company’s hospital customers have the right to receive a discounted price for Angiomax and volume-based rebates on Angiomax purchases. In the case of discounted pricing, the Company typically provides a credit to ICS, or a chargeback, representing the difference between ICS’ acquisition list price and the discounted price. In the case of the volume-based rebates, the Company typically pays the rebate directly to the hospitals. The Company also participates in the 340B Drug Pricing Program under the Public Health Services Act. Under the 340B Drug Pricing Program, the Company offers qualifying entities a discount off the commercial price of Angiomax for patients undergoing percutaneous coronary intervention on an outpatient basis. As a result of these agreements, at the time of product shipment, the Company estimates the likelihood that product sold to ICS might be ultimately sold to a contracting hospital or group purchasing organization. The Company also estimates the contracting hospital’s or group purchasing organization’s volume of purchases. The Company bases its estimates on industry data, hospital purchases and the historic chargeback data it receives from ICS, most of which ICS receives from wholesalers, which details historic buying patterns and sales mix for particular hospitals and group purchasing organizations, and the applicable customer chargeback rates and rebate thresholds. With the entrance of generic products and their impact on pricing in the marketplace, the Company is no longer able to reasonably estimate these chargebacks with respect to Angiomax. The Company’s allowance for chargebacks was $5.9 million and $1.9 million at December 31, 2017 and 2016 , respectively. The Company’s allowance for rebates was not material at December 31, 2017 and 2016 . • Fees-for-service. The Company offers discounts to certain wholesalers, Cardinal Health Inc. and ICS based on contractually determined rates for certain services. The Company estimates its fee-for-service accruals and allowances based on historical sales, wholesaler and distributor inventory levels and the applicable discount rate. The Company’s discounts are accrued at the time of the sale and are typically settled within 60 days after the end of each respective quarter. The Company’s fee-for-service accruals and allowances were $0.9 million and $0.8 million at December 31, 2017 and 2016 , respectively. The Company has adjusted its allowances for chargebacks and accruals for product returns, rebates and fees-for-service in the past based on actual sales experience, and the Company will likely be required to make adjustments to these allowances and accruals in the future. The Company continually monitors its allowances and accruals and makes adjustments when it believes actual experience may differ from its estimates. |
Cost of Product Revenue | Cost of product revenues consists of expenses in connection with the manufacture of Angiomax, Cleviprex, ready-to-use Argatroban, Kengreal and Ionsys, royalty expenses under the Company’s agreements with Biogen Idec (Biogen) and Health Research Inc. (HRI) related to Angiomax, with AstraZeneca AB (AstraZeneca) related to Cleviprex and with Eagle Pharmaceuticals, Inc. (Eagle) related to ready-to-use Argatroban and the logistics costs related to Angiomax, Cleviprex, ready-to-use Argatroban, Kengreal and Ionsys including distribution, storage and handling costs. Amounts billed for shipping and handling are recorded as revenue. Shipping and handling expenses are recorded as a component of cost of product revenue. |
Advertising Costs | The Company expenses advertising costs as incurred. |
Research and Development | Research and development costs are expensed as incurred. Clinical study costs are accrued over the service periods specified in the contracts and adjusted as necessary based upon an ongoing review of the level of effort and costs actually incurred. Payments for a product license prior to regulatory approval of the product and payments for milestones achieved prior to regulatory approval of the product are expensed in the period incurred as research and development. Milestone payments made in connection with regulatory approvals are capitalized and amortized to cost of revenue over the remaining useful life of the asset. The Company performs research and development for US government agencies under a cost-reimbursable contract in which the Company is reimbursed for direct costs incurred plus allowable indirect costs. The Company recognizes the reimbursements under research contracts when a contract has been executed, the contract price is fixed and determinable, delivery of services or products has occurred and collection of the contract price is reasonably assured. The reimbursements are classified as an offset to research and development expenses. Payments received in advance of work performed are deferred. |
Share-Based Compensation | The Company recognizes expense using the accelerated expense attribution method in an amount equal to the fair value of all share-based awards granted to employees. The Company estimates the fair value of its options on the date of grant using the Black-Scholes closed-form option-pricing model. Expected volatilities are based principally on historic volatility of the Company’s common stock. The Company uses historical data to estimate forfeiture rate. The expected term of options represents the period of time that options granted are expected to be outstanding. The Company has made a determination of expected term by analyzing employees’ historical exercise experience. The risk-free interest rate is based on the U.S. Treasury yield in effect at the time of grant corresponding with the expected life of the options. |
Foreign Currencies | The functional currencies of the Company’s foreign subsidiaries primarily are the local currencies: Euro, Swiss franc, and British pound sterling. The Company’s assets and liabilities are translated using the current exchange rate as of the balance sheet date. Stockholders’ equity is translated using historical rates at the balance sheet date. Revenues and expenses and other items of income are translated using a weighted average exchange rate over the period ended on the balance sheet date. Adjustments resulting from the translation of the financial statements of the Company’s foreign subsidiaries into U.S. dollars are excluded from the determination of net earnings (loss) and are accumulated in a separate component of stockholders’ equity. Foreign exchange transaction gains and losses are included in other income (loss) in the Company’s results of operations. |
Income Taxes | The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The Company records net deferred tax assets to the extent it believes these assets will more likely than not be realized. On a periodic basis, the Company evaluates the realizability of its deferred tax assets net of deferred tax liabilities and adjusts such amounts in light of changing facts and circumstances, including but not limited to its level of past and future taxable income, the current and future expected utilization of tax benefit carryforwards, any regulatory or legislative actions by relevant authorities with respect to the Angiomax patents, and the status of litigation with respect to those patents. The Company considers all available evidence, both positive and negative, to determine whether, based on the weight of that evidence, a valuation allowance is required to reduce the net deferred tax assets to the amount that is more likely than not to be realized in future periods. The Company’s annual effective tax rate is based on pre-tax earnings adjusted for differences between GAAP and income tax accounting, existing statutory tax rates, limitations on the use of net operating loss and tax credit carryforwards and tax planning opportunities available in the jurisdictions in which it operates. The Company records uncertain tax positions on the basis of a two-step process whereby (1) it determines whether it is more likely than not that a tax position will be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits of the position; and (2) for tax positions that meets the more-likely-than-not recognition threshold, the Company recognizes the largest amount of benefit that is greater than 50% likely of being realized upon ultimate settlement with the relevant tax authority. Significant judgment is required in evaluating the Company’s tax position. Settlement of filing positions that may be challenged by tax authorities could impact the income tax position in the year of resolution. The Company’s liability for uncertain tax positions is reflected as a reduction to its deferred tax assets on its consolidated balance sheet. |
Comprehensive Income (Loss) | The Company’s accumulated comprehensive income (loss) is comprised of unrealized gains and losses on available for sale securities (if any), which are recorded and presented net of income tax, and foreign currency translation. |
Recent Accounting Pronouncements | In May 2014, the Financial Accounting Standards Board (FASB) issued a comprehensive new revenue recognition Accounting Standards Update (ASU), “Revenue from Contracts with Customers (Topic 606)” (ASU No. 2014-09). ASU No. 2014-09 provides guidance to clarify the principles for recognizing revenue. This guidance includes the required steps to achieve the core principle that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In August 2015, the FASB deferred the effective date of the revenue recognition guidance to reporting periods beginning after December 15, 2017. Early adoption of the standard is permitted but not before the original effective date, which was for reporting periods beginning after December 15, 2016. The FASB has further amended guidance related to recording revenue on a gross versus a net basis and on identifying performance obligations and licensing. The FASB has also rescinded certain SEC guidance primarily related to ASC Topic 815, “Derivatives and Hedging,” and has issued additional improvements and practical expedients to the standard. The Company, has analyzed the impacts of ASU No. 2014-09 on its revenue streams, specifically focusing on its product revenues, including its arrangement with Sandoz to sell in the United States an authorized generic version of Angiomax (bivalirudin). The Company’s assessment included a review of current accounting policies and practices to identify potential differences that would result from applying the guidance. Currently, the Company uses a deferred revenue model for sales of its authorized generic version of Angiomax (bivalirudin) as the price is not fixed or determinable and recognizes royalty revenue on an accrual basis in the period in which Sandoz reports sales to its customers. The Company currently records revenue recognized from sales of bivalirudin to Sandoz in both net product revenues and royalty revenues in its consolidated statements of operations. Under the new standard, the promise to provide bivalirudin to Sandoz and the promise to provide exclusivity to Sandoz to distribute bivalirudin in the United States will constitute one performance obligation; as a result, under the new standard, revenue recognized from sales of bivalirudin to Sandoz will be recorded solely in net product revenues in the Company’s consolidated statements of operations upon transfer of control of product to Sandoz. The transaction price will reflect the amount the Company expects to be entitled to in connection with the sale of bivalirudin to Sandoz, which will include an estimate of the variable amount of the consideration subject to the constraint that it must be probable that a significant reversal of revenue will not occur. This may result in revenue being recognized earlier provided the Company can reliably estimate the ultimate price expected to be realized from Sandoz’s customer. The Company has concluded that the adoption of this guidance will not have a material impact on its consolidated financial statements. However, the Company will be required to provide additional disclosures in the notes to the consolidated financial statements upon adoption. The Company will adopt the standard using the modified retrospective method. In January 2016, the FASB issued ASU No. 2016-01, “Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities” (ASU No. 2016-01). ASU No. 2016-01 amends certain aspects of accounting and disclosure requirements of financial instruments, including the requirement that equity investments with readily determinable fair values be measured at fair value with changes in fair value recognized in a company’s results of operations. The new standard does not apply to investments accounted for under the equity method of accounting or those that result in consolidation of the investee. Equity investments that do not have readily determinable fair values may be measured at fair value or at cost minus impairment adjusted for changes in observable prices. A financial liability that is measured at fair value in accordance with the fair value option is required to be presented separately in other comprehensive income for the portion of the total change in the fair value resulting from change in the instrument-specific credit risk. In addition, a valuation allowance should be evaluated on deferred tax assets related to available-for-sale debt securities in combination with other deferred tax assets. ASU No. 2016-01 will be effective for public companies for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. Based on current investment holdings, the Company does not believe the adoption of this standard is expected to have a material impact on the consolidated balance sheets and statements of operations. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” (ASU No. 2016-02). ASU No. 2016-02 will require organizations that lease assets with lease terms of more than 12 months to recognize assets and liabilities for the rights and obligations created by those leases on their balance sheets. The ASU will also require new qualitative and quantitative disclosures to help investors and other financial statement users better understand the amount, timing, and uncertainty of cash flows arising from leases. ASU No. 2016-02 will be effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018, with early adoption permitted. The Company expects to adopt this guidance when effective and is currently evaluating the effect that the updated standard will have on its consolidated financial statements and related disclosures. In March 2016, the FASB issued ASU No. 2016-09, “Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting” (ASU No. 2016-09). This ASU makes several modifications to Topic 718 related to the accounting for forfeitures, employer tax withholding on share-based compensation, and the financial statement presentation of excess tax benefits or deficiencies. ASU No. 2016-09 also clarifies the statement of cash flows presentation for certain components of share-based awards. On January 1, 2017, the Company adopted ASU No. 2016-09 and has elected to continue its determination of compensation costs recognized in each period based upon an estimate of expected future forfeitures. Upon the settlement of awards during the year ended December 31, 2017, the Company recorded excess tax benefits of $3.0 million but was unable to recognize any benefit due to the establishment of a valuation allowance on its net operating loss carry forward deferred tax assets. There was no net impact on the Company’s opening accumulated deficit upon application of this guidance using the modified retrospective transition method as the total cumulative-effect adjustment for previously deferred excess tax benefits was offset by a related change in the valuation allowance. The other amended requirements of ASU No. 2016-09 did not have a material impact on the Company’s consolidated financial statements and related disclosures. In August 2016, the FASB issued ASU No. 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments” (ASU No. 2016-15). This guidance clarifies how certain cash receipts and payments should be presented in the statement of cash flows and is effective for interim and annual reporting periods beginning after December 15, 2017, with early adoption permitted. The Company does not believe that this guidance will have an impact on the consolidated financial statements and related disclosures. In November 2016, the FASB issued ASU 2016-18, “Statement of Cash Flows (Topic 230): Restricted Cash” (ASU No. 2016-18). This amends the guidance in ASC 230, including providing additional guidance related to transfers between cash and restricted cash and how entities present, in their statement of cash flows, the cash receipts and cash payments that directly affect the restricted cash accounts. ASU 2016-18 is effective for annual reporting periods beginning after December 15, 2017, and interim periods within those years, with early adoption permitted. The Company does not believe that this guidance will have an impact on the consolidated financial statements and related disclosures. In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business, which clarifies the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. ASU 2017-01 is effective for annual reporting periods beginning after December 15, 2017, and interim periods within those years, with early adoption permitted. The Company will apply the guidance to applicable transactions after the adoption date. The impact on the Company’s consolidated financial statements will depend on the facts and circumstances of any specific future transactions. In January 2017, the FASB issued ASU 2017-04, Intangibles-Goodwill and Other, Simplifying the Test for Goodwill Impairment, which eliminates Step 2 from the goodwill impairment test. Under the revised test, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. This ASU is effective for any interim or annual impairment tests for fiscal years beginning after December 15, 2019, with early adoption permitted. The Company does not believe that this guidance will have an impact on the consolidated financial statements and related disclosures. |
Fair Value Measurements | The Company applies a fair value framework in order to measure and disclose its financial assets and liabilities. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy requires an entity to maximize the use of observable inputs, where available, and minimize the use of unobservable inputs when measuring fair value. There are three levels of inputs that may be used to measure fair value: Level 1 Quoted prices in active markets for identical assets or liabilities. The Company’s Level 1 asset consists of money market investments. Level 2 Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Fair values are determined by utilizing quoted prices for similar assets and liabilities in active markets or other market observable inputs such as interest rates and yield curves. Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company’s Level 3 assets and liabilities consist of the contingent purchase prices associated with the Company’s dispositions and business combinations, respectively. The fair value of certain development or regulatory milestone based contingent purchase prices was determined in a discounted cash flow framework by probability weighting the future contractual payment with management's assessment of the likelihood of achieving these milestones and present valuing them using a risk-adjusted discount rate. Certain sales milestone based payments were determined in a discounted cash flow framework where risk-adjusted revenue scenarios were estimated using Monte Carlo simulation models to compute contractual payments which were present valued using a risk-adjusted discount rate. |
Significant Accounting Polici33
Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Schedule of Sales Allowances and Accruals | The following table provides a summary of activity with respect to the Company’s sales allowances and accruals during 2017 , 2016 and 2015 (amounts in thousands): Cash Discounts Returns Chargebacks Rebates Fees-for- Service Balance at January 1, 2015 $ 4,142 $ 3,349 $ 44,399 $ — $ 924 Allowances for sales during 2015 9,212 12,143 107,564 833 14,249 Actual credits issued for prior year’s sales (3,927 ) (3,528 ) (40,419 ) — (1,179 ) Actual credits issued for sales during 2015 (8,540 ) (3,221 ) (95,828 ) (733 ) (11,314 ) Balance at December 31, 2015 887 8,743 15,716 100 2,680 Allowances for sales during 2016 1,854 (1,424 ) 36,197 (6 ) 3,166 Actual credits issued for prior year’s sales (887 ) (5,233 ) (15,610 ) (50 ) (2,655 ) Actual credits issued for sales during 2016 (1,573 ) (502 ) (34,408 ) (29 ) (2,365 ) Balance at December 31, 2016 281 1,584 1,895 15 826 Allowances for sales during 2017 1,746 4,439 17,395 271 3,085 Actual credits issued for prior year’s sales (281 ) (1,464 ) (1,246 ) (15 ) (865 ) Actual credits issued for sales during 2017 (775 ) (220 ) (12,172 ) (126 ) (2,152 ) Balance at December 31, 2017 $ 971 $ 4,339 $ 5,872 $ 145 $ 894 |
Inventory (Tables)
Inventory (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | The major classes of inventory were as follows: 2017 2016 (In thousands) Raw materials $ 1,389 $ 18,714 Work-in-progress 3,608 8,397 Finished goods 562 1,375 Total $ 5,559 $ 28,486 |
Fixed Assets (Tables)
Fixed Assets (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Fixed Assets | Fixed assets consist of the following: Estimated December 31, Life (Years) 2017 2016 (In thousands) Furniture, fixtures and equipment 2-15 $ 20,603 $ 25,132 Computer software 2-5 3,524 3,722 Computer hardware 2-5 3,054 3,795 Leasehold improvements 2-15 33,064 30,702 60,245 63,351 Less: Accumulated depreciation (42,991 ) (32,390 ) $ 17,254 $ 30,961 |
Acquisition (Tables)
Acquisition (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
Purchase Price | Total purchase price, in thousands, is summarized as follows: Upfront cash consideration $ 28,397 Fair value of existing equity interest in Annovation 25,886 Total cash consideration and fair value of existing equity interest 54,283 Fair value of contingent cash payment 18,000 Total purchase price $ 72,283 |
Assets Acquired and Liabilities Assumed | Below is a summary which details, in thousands, the allocation of assets acquired and liabilities assumed as a result of this acquisition: Assets acquired: Cash and cash equivalents $ 1,482 Other current assets 692 IPR&D 65,000 Goodwill 24,530 Total assets $ 91,704 Liabilities assumed: Accrued expenses $ 398 Contingent purchase price 18,000 Deferred tax liability, net 19,023 Total liabilities $ 37,421 Total cash price paid upon acquisition and fair value of existing equity interest $ 54,283 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived Intangible Assets | The following table sets forth the carrying amounts and accumulated amortization of the Company’s intangible assets: As of December 31, 2017 As of December 31, 2016 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount (In thousands) Amortizable intangible assets Product licenses (1) $ — $ — $ — $ 30,000 $ (3,013 ) $ 26,987 Developed product rights (2) — — — 250,000 (19,802 ) 230,198 Total $ — $ — $ — $ 280,000 $ (22,815 ) $ 257,185 Intangible assets not subject to amortization: In-process research & development — — — 65,000 — 65,000 Total intangible assets not subject to amortization: — — — 65,000 — 65,000 Total intangible assets $ — $ — $ — $ 345,000 $ (22,815 ) $ 322,185 _______________________________________ (1) The Company amortizes intangible assets related to the product licenses over their expected useful lives. (2) The Company amortizes intangible assets related to developed product rights over the remaining life of the patents. |
Schedule of Indefinite-lived Intangible Assets | The following table sets forth the carrying amounts and accumulated amortization of the Company’s intangible assets: As of December 31, 2017 As of December 31, 2016 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount (In thousands) Amortizable intangible assets Product licenses (1) $ — $ — $ — $ 30,000 $ (3,013 ) $ 26,987 Developed product rights (2) — — — 250,000 (19,802 ) 230,198 Total $ — $ — $ — $ 280,000 $ (22,815 ) $ 257,185 Intangible assets not subject to amortization: In-process research & development — — — 65,000 — 65,000 Total intangible assets not subject to amortization: — — — 65,000 — 65,000 Total intangible assets $ — $ — $ — $ 345,000 $ (22,815 ) $ 322,185 _______________________________________ (1) The Company amortizes intangible assets related to the product licenses over their expected useful lives. (2) The Company amortizes intangible assets related to developed product rights over the remaining life of the patents. |
Schedule of Goodwill | The changes in the carrying amount of goodwill for the years ended December 31, 2017 and 2016 are as follows: December 31, December 31, (In thousands) Balance at beginning of period $ 200,571 $ 234,383 Allocation of goodwill to the Non-Core ACC Products — (33,812 ) Balance at end of period $ 200,571 $ 200,571 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Accrued Expenses | Accrued expenses consisted of the following at December 31, 2017 and 2016 : 2017 2016 (In thousands) Royalties $ 1,039 $ 739 Research and development services 43,496 11,477 Compensation related 25,621 28,802 Product returns, rebates and other fees 5,363 2,336 Legal, accounting and other 6,162 4,821 Manufacturing, logistics and related fees 1,984 6,200 Sales and marketing 1,875 1,575 Interest 9,657 10,888 Total $ 95,197 $ 66,838 |
Convertible Senior Notes (Table
Convertible Senior Notes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | The 2017 Notes consisted of the following: Liability component December 31, December 31, (In thousands) Principal $ — $ 55,000 Less: Debt discount, net (1) — (1,251 ) Net carrying amount $ — $ 53,749 _______________________________________ (1) Included on the accompanying consolidated balance sheets within convertible senior notes (due 2017) and amortized to interest expense over the remaining life of the 2017 Notes using the effective interest rate method. The 2022 Notes consist of the following: Liability component December 31, 2017 December 31, 2016 (In thousands) Principal $ 399,997 $ 400,000 Less: Debt discount, net (1) (62,747 ) (75,754 ) Net carrying amount $ 337,250 $ 324,246 _______________________________________ (1) Included on the accompanying consolidated balance sheets within convertible senior notes (due 2022) and amortized to interest expense over the remaining life of the 2022 Notes using the effective interest rate method. The 2023 Notes consist of the following: Liability component December 31, 2017 December 31, 2016 (in thousands) Principal $ 402,500 $ 402,500 Less: Debt discount, net (1) (90,552 ) (103,162 ) Net carrying amount $ 311,948 $ 299,338 _______________________________________ (1) Included in the accompanying consolidated balance sheets within convertible senior notes (due 2023) and amortized to interest expense over the remaining life of the 2023 Notes using the effective interest rate method. |
Schedule of Interest Expense | The following table sets forth total interest expense recognized related to the 2023 Notes: Years Ended December 31, 2017 2016 2015 (in thousands) Contractual interest expense $ 11,060 $ 6,158 $ — Amortization of debt discount 12,610 6,648 — Total $ 23,670 $ 12,806 $ — Effective interest rate of the liability component 7.5 % 7.5 % — % The following table sets forth total interest expense recognized related to the 2022 Notes: Years Ended December 31, 2017 2016 2015 (In thousands) Contractual interest expense $ 10,000 $ 10,000 $ 9,639 Amortization of debt discount 13,007 12,139 10,942 Total $ 23,007 $ 22,139 $ 20,581 Effective interest rate of the liability component 6.50 % 6.50 % — % The following table sets forth total interest expense recognized related to the 2017 Notes: Years Ended December 31, 2017 2016 2015 (In thousands) Contractual interest expense $ 315 $ 2,101 $ 3,781 Amortization of debt discount 1,251 7,395 12,734 Total $ 1,566 $ 9,496 $ 16,515 Effective interest rate of the liability component 6.02 % 6.02 % 6.02 % |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Stock Option Activity | The following table presents a summary of option activity and data under the Company’s stock incentive plans as of December 31, 2017 : Number of Shares Weighted-Average Exercise Price Per Share Weighted- Average Remaining Contractual Term (Years) Aggregate Intrinsic Value Balance at January 1, 2017 8,023,696 $ 28.27 Granted 1,693,309 $ 49.89 Exercised (1,854,644 ) $ 24.57 Forfeited and expired (818,871 ) $ 37.24 Outstanding, December 31, 2017 7,043,490 $ 33.40 5.85 $ 11,705,399 Vested and expected to vest, December 31, 2017 6,842,097 $ 33.13 5.81 $ 11,699,950 Exercisable, December 31, 2017 4,190,582 $ 28.97 5.05 $ 11,487,732 Available for future grant at December 31, 2017 3,202,401 |
Schedule of Valuation Assumptions | The Company estimated the fair value of each option on the date of grant using the Black-Scholes closed-form option-pricing model applying the weighted average assumptions in the following table. Years Ended December 31, 2017 2016 2015 Expected dividend yield — % — % — % Expected stock price volatility 39.14 % 37.90 % 41.49 % Risk-free interest rate 1.867 % 1.249 % 1.436 % Expected option term (years) 5.00 4.93 5.01 The fair value of each option element of the 2010 ESPP is estimated on the date of grant using the Black-Scholes closed-form option-pricing model applying the weighted average assumptions in the following table. Expected volatilities are based on historical volatility of the Company’s common stock. Expected term represents the six -month offering period for the 2010 ESPP. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. Years Ended December 31, 2017 2016 2015 Expected dividend yield — % — % — % Expected stock price volatility 43.03 % 48.80 % 44.91 % Risk-free interest rate 0.89 % 0.34 % 0.15 % Expected option term (years) 0.5 0.5 0.5 |
Schedule of Restricted Stock and Restricted Stock Units Activity | The following table presents a summary of the Company’s outstanding shares of restricted stock awards granted as of December 31, 2017 : Number of Shares Weighted Average Grant-Date Fair Value Balance at January 1, 2017 375,301 $ 31.88 Awarded 196,462 50.51 Vested (172,076 ) 32.80 Forfeited (30,359 ) 44.03 Outstanding, December 31, 2017 369,328 $ 40.37 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Earnings per Share | The following table sets forth the computation of basic and diluted earnings per share for the years ended December 31, 2017 , 2016 and 2015 . Year Ended December 31, 2017 2016 2015 (In thousands, except per share amounts) Amounts attributable to The Medicines Company: (Loss) income from continuing operations $ (607,695 ) $ 20,564 $ (134,806 ) Loss from discontinued operations, net of tax (100,678 ) (139,682 ) (217,950 ) Net loss attributable to The Medicines Company $ (708,373 ) $ (119,118 ) $ (352,756 ) . Weighted average common shares outstanding, basic 72,356 69,909 66,809 Plus: net effect of dilutive stock options, warrants, restricted common shares and shares issuable upon conversion of Notes — 3,113 — Weighted average common shares outstanding, diluted 72,356 73,022 66,809 Basic (loss) earnings per common share attributable to The Medicines Company: (Loss) earnings from continuing operations $ (8.40 ) $ 0.29 $ (2.02 ) Loss from discontinued operations (1.39 ) (2.00 ) (3.26 ) Basic loss per share $ (9.79 ) $ (1.71 ) $ (5.28 ) Diluted (loss) earnings per common share attributable to The Medicines Company: (Loss) earnings from continuing operations $ (8.40 ) $ 0.28 $ (2.02 ) Loss from discontinued operations (1.39 ) (1.91 ) (3.26 ) Diluted loss per share $ (9.79 ) $ (1.63 ) $ (5.28 ) |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of Benefit From (Provision For) Income Taxes | The benefit from (provision for) income taxes for continuing operations in 2017 , 2016 and 2015 consists of current and deferred federal, state and foreign taxes based on income as follows: 2017 2016 2015 (In thousands) Current: Federal $ 4,859 $ — $ (5 ) State (31 ) (33 ) (182 ) Foreign 1,757 (34 ) (229 ) 6,585 (67 ) (416 ) Deferred: Federal $ 88,556 $ — $ 28,011 State 1,435 — 2,138 Foreign — — — 89,991 — 30,149 Total benefit from (provision for) taxes $ 96,576 $ (67 ) $ 29,733 |
Schedule of Components of Loss From Continuing Operations | The components of (loss) income from continuing operations attributable to The Medicines Company before income taxes consisted of: 2017 2016 2015 (In thousands) Domestic $ (704,814 ) $ 22,289 $ (163,772 ) International 543 (1,712 ) (757 ) Total $ (704,271 ) $ 20,577 $ (164,529 ) |
Schedule of Effective Income Tax Rate Reconciliation | The difference between tax expense and the amount computed by applying the statutory federal income tax rate of 35% in 2017 , 2016 , and 2015 to income before income taxes is as follows: Year Ended December 31, 2017 2016 2015 (In thousands) Statutory rate applied to pre-tax (loss) income from continuing operations $ (246,495 ) $ 7,202 $ (57,589 ) (Deduct) add: State income taxes, net of federal benefit (913 ) 21 (1,273 ) Foreign 53 442 287 Revaluation of contingent purchase price (5,366 ) (10,244 ) 10,272 Tax credits (3,539 ) (967 ) (305 ) Lobbying costs — — 35 Meals and entertainment 372 605 810 Uncertain tax positions (1,635 ) (2,064 ) 61 Bargain purchase — — (7,310 ) Loss on extinguishment of debt — 1,403 — Loss on ACC goodwill — 11,834 — Excess stock option benefit (4,589 ) — — Change in federal tax rate due to the Tax Cuts and Jobs Act 126,502 — — Other 785 (485 ) 1,239 Tax benefit of operating loss carryforwards 11,509 (105,045 ) — Valuation allowances 26,740 97,365 24,040 Income tax benefit $ (96,576 ) $ 67 $ (29,733 ) |
Schedule of Deferred Tax Assets and Liabilities | The significant components of the Company’s deferred tax assets are as follows: December 31, 2017 2016 (In thousands) Deferred tax assets: Net operating loss carryforwards $ 235,852 $ 230,775 Tax credits 20,096 20,973 Stock based compensation 19,611 28,268 Other 26,113 26,889 Total deferred tax assets 301,672 306,905 Valuation allowance (239,536 ) (162,892 ) Total deferred tax assets net of valuation allowance 62,136 144,013 Deferred tax liabilities: Fixed assets $ (568 ) $ (4,997 ) Intangible assets (30,664 ) (81,877 ) Convertible debt (30,904 ) (57,430 ) Indefinite lived intangible assets — (89,701 ) Total deferred tax liabilities (62,136 ) (234,005 ) Net deferred tax liabilities $ — $ (89,992 ) |
Summary of Operating Loss Carryforwards | At December 31, 2017 , the Company has federal net operating loss carryforwards available to reduce taxable income and federal research and development tax credit carryforwards available to reduce future tax liabilities. They expire approximately as follows: Year of Expiration Federal Net Federal Research (In thousands) 2027 $ 6,256 $ 840 2028 38,954 2,108 2029 4,755 1,149 2030 1,030 1,162 2031 605 3,097 2032 1,533 3,666 2033 37,209 3,178 2034 4,353 1,861 2035 195,416 752 2036 293,661 1,739 2037 423,531 3,515 $ 1,007,303 $ 23,067 |
Summary of Tax Credit Carryforwards | At December 31, 2017 , the Company has federal net operating loss carryforwards available to reduce taxable income and federal research and development tax credit carryforwards available to reduce future tax liabilities. They expire approximately as follows: Year of Expiration Federal Net Federal Research (In thousands) 2027 $ 6,256 $ 840 2028 38,954 2,108 2029 4,755 1,149 2030 1,030 1,162 2031 605 3,097 2032 1,533 3,666 2033 37,209 3,178 2034 4,353 1,861 2035 195,416 752 2036 293,661 1,739 2037 423,531 3,515 $ 1,007,303 $ 23,067 |
Summary of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows: Gross Unrecognized Tax Benefits (In thousands) Balance at January 1, 2015 $ 8,022 Additions related to current year tax positions 61 Balance at December 31, 2015 8,083 Additions related to current year tax positions 193 Balance at December 31, 2016 6,018 Additions related to current year tax positions 708 Reductions for prior year tax positions (2,843 ) Balance at December 31, 2017 $ 3,883 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured at Fair Value on Recurring Basis | Except for the Company’s Level 2 liabilities which are discussed in Note 9 , “Convertible Senior Notes,” the following table sets forth the Company’s assets and liabilities that are measured at fair value on a recurring basis at December 31, 2017 and 2016 , by level, within the fair value hierarchy: As of December 31, 2017 As of December 31, 2016 Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Balance at December 31, Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Balance at December 31, Assets and Liabilities (Level 1) (Level 2) (Level 3) 2017 (Level 1) (Level 2) (Level 3) 2016 (In thousands) Assets: Cash and cash equivalents $ 12,100 $ — $ 12,100 $ 56,097 $ — $ — $ 56,097 Total assets at fair value $ 12,100 $ — $ — $ 12,100 $ 56,097 $ — $ — $ 56,097 Liabilities: Contingent purchase price $ — $ — $ 19,650 $ 19,650 $ — $ — $ 31,832 $ 31,832 Total liabilities at fair value $ — $ — $ 19,650 $ 19,650 $ — $ — $ 31,832 $ 31,832 |
Fair Value Inputs, Quantitative Information | The following table provides quantitative information associated with the fair value measurements of the Company’s Level 3 liabilities: Fair Value as of December 31, 2017 Valuation Technique Unobservable Input Range (Weighted Average) (In thousands) Rempex: Contingent purchase price: Event-based milestones $ 19,650 Probability-adjusted discounted cash flow Probabilities of successes 18% - 90% (71%) Period in which milestones are expected to be achieved 2018 - 2024 Discount rate 4.8% - 7.5% Fair Value as of December 31, 2016 Valuation Technique Unobservable Input Range (Weighted Average) (In thousands) Incline: Contingent purchase price $ 1,269 Probability-adjusted discounted cash flow Probabilities of successes 5% Period in which milestones are expected to be achieved 2019 Discount rate 18% Rempex: Contingent purchase price: Event-based milestones $ 16,500 Probability-adjusted discounted cash flow Probabilities of successes 18% - 95% (78%) Discount rate 6.6% - 8.2% Annovation: Contingent purchase price $ 14,063 Probability-adjusted discounted cash flow Probabilities of successes 9% - 50% (34%) Period in which milestones are expected to be achieved 2018 - 2031 Discount rate 6.0% - 10.0% |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | The changes in fair value of the Company’s Level 3 contingent purchase price during the year ended December 31, 2017 and 2016 were as follows: December 31, 2017 2016 (In thousands) Balance at beginning of period $ 31,832 $ 18,300 Payments — (10,449 ) Fair value adjustments to contingent purchase prices included in net loss (12,182 ) 23,981 Balance at end of period $ 19,650 $ 31,832 |
Restructuring (Tables)
Restructuring (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Activities | The following tables set forth details regarding the activities described above during the years ended December 31, 2017 and 2016: Balance as of January 1, 2017 Expenses, Net Cash Noncash Balance as of December 31, 2017 (in thousands) Employee severance and other personnel benefits: 2017 Workforce reduction $ — $ 5,897 $ (5,768 ) $ (129 ) $ — 2016 Workforce reduction 1,854 — (1,038 ) (816 ) — Total $ 1,854 $ 5,897 $ (6,806 ) $ (945 ) $ — |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Future Estimated Contractual Obligations | Future estimated contractual obligations as of December 31, 2017 are: Contractual Obligations (1) (2) Less Than 1 Year 1-3 Years 3-5 Years More Than 5 Years Total (In thousands) Inventory related commitments $ 52,111 $ 16,167 $ — $ — $ 68,278 Research and development 71,115 68,387 34,508 30,409 204,419 Operating leases 7,185 15,029 15,428 27,928 65,570 Selling, general and administrative 3,924 1,379 — — 5,303 Total contractual obligations $ 134,335 $ 100,962 $ 49,936 $ 58,337 $ 343,570 _______________________________________ (1) This table does not include any milestone and royalty payments which may become payable to third parties for which the timing and likelihood of such payments are not known, as discussed below. It also does not include the long-term debt obligations. See Note 9 “Convertible Senior Notes” for further details. |
Segment and Geographic Inform46
Segment and Geographic Information (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Revenue by Major Geographic Region | Years Ended December 31, 2017 2016 2015 (In thousands) Net revenue: United States $ 37,131 82.9 % $ 131,572 91.9 % $ 275,118 93.4 % Europe 7,239 16.2 % 9,331 6.5 % 16,745 5.7 % Other 419 0.9 % 2,258 1.6 % 2,684 0.9 % Total net revenue $ 44,789 $ 143,161 $ 294,547 |
Assets by Major Geographic Region | Years Ended December 31, 2017 2016 (In thousands) Long-lived assets: United States $ 308,843 99.7 % $ 699,004 99.4 % Europe 836 0.3 % 4,160 0.6 % Total long-lived assets $ 309,679 $ 703,164 |
Accumulated Other Comprehensi47
Accumulated Other Comprehensive (Loss) Income (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive (Loss) Income | The following table provides a reconciliation of the components of accumulated other comprehensive loss , net of tax, attributable to The Medicines Company: Foreign currency translation adjustment Unrealized (gain) loss on available for sale securities Total (In thousands) Balance at January 1, 2015 $ 2,479 $ 49 $ 2,528 Other comprehensive income before reclassifications 1,445 — 1,445 Total other comprehensive income 1,445 — 1,445 Balance at December 31, 2015 $ 3,924 $ 49 $ 3,973 Other comprehensive income before reclassifications 213 — 213 Amounts reclassified from accumulated other comprehensive income (1) (2) (9,616 ) (49 ) (9,665 ) Total other comprehensive loss (9,403 ) (49 ) (9,452 ) Balance at December 31, 2016 $ (5,479 ) $ — $ (5,479 ) Other comprehensive income before reclassifications 296 296 Total other comprehensive income 296 — 296 Balance at December 31, 2017 $ (5,183 ) $ — $ (5,183 ) |
Selected Quarterly Financial 48
Selected Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Information (Unaudited) | The following table presents selected quarterly financial data for the years ended December 31, 2017 and 2016 . Three Months Ended March 31, 2017 June 30, 2017 Sept. 30, 2017 Dec. 31, 2017 March 31, 2016 June 30, 2016 Sept. 30, 2016 Dec. 31, 2016 (1) (2) (3) (In thousands, except per share data) Total net revenues $ 17,465 $ 10,861 $ 7,868 $ 8,595 $ 46,075 $ 48,573 $ 31,084 $ 17,429 Cost of product revenues 9,978 12,490 4,287 20,438 16,042 12,061 18,213 14,337 Total operating expenses 76,879 393,195 71,129 168,682 104,248 120,817 51,881 88,296 Loss from operations (59,414 ) (382,334 ) (63,261 ) (160,087 ) (58,173 ) (72,244 ) (20,797 ) (70,867 ) (Loss) income from continuing operations attributable to The Medicines Company $ (70,996 ) $ (370,065 ) $ (7,218 ) $ (159,416 ) $ (67,125 ) $ 201,912 $ (31,444 ) $ (82,779 ) (Loss) income from discontinued operations, net of tax attributable to The Medicines Company (31,674 ) (27,203 ) (22,957 ) (18,844 ) (25,324 ) (19,470 ) (54,815 ) (40,073 ) Net (loss) income attributable to The Medicines Company $ (102,670 ) $ (397,268 ) $ (30,175 ) $ (178,260 ) $ (92,449 ) $ 182,442 $ (86,259 ) $ (122,852 ) Diluted (loss) earnings per common share attributable to The Medicines Company: (Loss) earnings from continuing operations $ (1.00 ) $ (5.15 ) $ (0.10 ) $ (2.19 ) $ (0.97 ) $ 2.78 $ (0.45 ) $ (1.17 ) (Loss) income from discontinued operations (0.45 ) (0.38 ) (0.31 ) (0.26 ) (0.37 ) (0.27 ) (0.78 ) (0.57 ) Diluted loss per share $ (1.45 ) $ (5.53 ) $ (0.41 ) $ (2.45 ) $ (1.34 ) $ 2.51 $ (1.23 ) $ (1.74 ) ______________________________________ (1) In June 2017, we commenced a voluntary discontinuation and withdrawal of Ionsys from the market and ceased related commercialization activities, with the regulatory authorizations for Ionsys remaining open. Concurrent with this market withdrawal, the Company commenced a workforce reduction, which resulted in the reduction of 57 employees, representing approximately 15% of the Company’s workforce at that time. The Company recorded a pre-tax charge of approximately $276.9 million associated with the discontinuation and market withdrawal of Ionsys in the United States market. In August 2017, the Company announced that it discontinued the clinical development program for MDCO-700 and recorded the following non-cash adjustments during the second quarter of 2017: $65.0 million of asset impairment charges to in-process research and development (IPR&D) acquired from Annovation, a $14.7 million decrease in the carrying value of the contingent purchase price to an estimated fair value of zero , and a $23.0 million benefit for income taxes due to a reduction in the Company’s recorded valuation allowance against its deferred tax assets as a result of the impairment charge. (2) In the fourth quarter of 2017, the Company decreased the carrying value of the contingent purchase price from the sale of the Hemostasis Business by $63.0 million as a result of the discontinuation of Raplixa by Mallinckrodt. (3) On June 21, 2016, the Company completed the sale of its Non-Core ACC Products pursuant to the purchase and sale agreement dated May 9, 2016 by and among the Company, Chiesi USA and Chiesi. As a result of this sale, the Company realized a gain on sale of business of $288.3 million . |
Dispositions (Tables)
Dispositions (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Major Classes of Assets Sold and Gain Recognized | The following table presents the consideration received, major classes of assets sold and the gain recognized on the sale of the Non-Core ACC Products: (in thousands) Sale price: Cash $ 263,807 Contingent purchase price from sale of business 65,700 Total sale price 329,507 Assets: Inventory 2,184 Intangibles 5,210 Goodwill 33,812 Total assets sold 41,206 Gain on sale of business $ 288,301 The following table presents key financial results of the infectious disease business included in “ Loss from discontinued operations, net of tax ” for years ended 2017 , 2016 and 2015 . Year Ended December 31, 2017 2016 2015 (In thousands) Net product revenues $ 34,622 $ 24,673 $ 14,460 Operating expenses: Cost of product revenue 20,060 10,693 15,945 Research and development 39,984 47,155 33,218 Selling, general and administrative 74,346 106,670 52,643 Total operating expenses 134,390 164,518 101,806 Loss from operations (99,768 ) (139,845 ) (87,346 ) Other expense, net (906 ) (19 ) 212 Loss from discontinued operations before income taxes (100,674 ) (139,864 ) (87,134 ) Provision (benefit) for income taxes 4 2 (10 ) Loss from discontinued operations, net of tax $ (100,678 ) $ (139,866 ) $ (87,124 ) The following table presents the major classes of assets and liabilities at December 31, 2017 and 2016 related to the infectious disease business which were reclassified as held for sale: December 31, December 31, 2017 2016 (In thousands) Assets: Accounts receivable, net $ 9,595 $ 3,916 Inventory 41,412 42,411 Other receivables 2,740 4,259 Intangibles, net 282,398 — Goodwill 55,057 — Current assets held for sale 391,202 50,586 Intangibles, net — 293,036 Goodwill — 55,057 Total assets held for sale $ 391,202 $ 398,679 Liabilities: Accounts payable $ 1,127 $ 7,872 Accrued expenses 22,945 21,686 Contingent purchase price – current 24,650 55,000 Deferred Revenue 723 2,467 Contingent purchase price – noncurrent 11,135 — Current liabilities held for sale 60,580 87,025 Contingent purchase price – noncurrent — 50,457 Total liabilities held for sale $ 60,580 $ 137,482 Depreciation and amortization was ceased upon determination that the held for sale criteria were met in the fourth quarter of 2017. The significant cash flow items from discontinued operations for years ended 2017 , 2016 and 2015 were as follows: Year Ended December 31, 2017 2016 2015 (In thousands) Amortization from discontinued operations $ 10,638 $ 17,858 $ 6,798 Changes in contingent purchase price (3,456 ) 53,249 1 Reserve for excess or obsolete inventory (435 ) (2,066 ) 4,228 Payments on contingent purchase price (63,066 ) (10,449 ) (18 ) The following table presents key financial results of the Hemostasis business included in “ Loss from discontinued operations, net of tax ” for years ended December 31, 2016 and 2015 . Year Ended December 31, 2016 2015 (In thousands) Net product revenues $ 1,275 $ 65,754 Operating expenses: Cost of product revenue 1,424 75,889 Research and development 90 7,568 Selling, general and administrative 542 560 Impairment — 133,266 Total operating expenses 2,056 217,283 Income (loss) from operations (781 ) (151,529 ) Gain from sale of business 1,004 — Other expense, net (39 ) (745 ) Income (loss) from discontinued operations before income taxes 184 (152,274 ) Benefit for income taxes — (21,448 ) Loss from discontinued operations, net of tax $ 184 $ (130,826 ) Cumulative translation adjustment (CTA) gains or losses of foreign subsidiaries related to divested businesses are reclassified into income once the liquidation of the respective foreign subsidiaries is substantially complete. At the completion of the sale of the Hemostasis Business, the Company reclassified $9.6 million , net of tax, of CTA gains from accumulated comprehensive loss to the Company’s results of discontinued operations. Of this amount, $8.4 million was included in the impairment loss recorded to reduce the Hemostasis Business disposal group’s carrying value to its estimated fair value, less costs to sell as of December 31, 2015 and $1.2 million was included in “Gain from sale of business” for the year ended December 31, 2016. Cost of product revenue for the three months ended September 30, 2015 included a charge of $25.8 million to reduce the carrying value of the product rights associated with PreveLeak to their estimated fair value as a result of a reduction in expected future cash flows. The significant cash flow items from discontinued operations for years ended December 31, 2016 and 2015 were as follows: Year Ended December 31, 2016 2015 (In thousands) Depreciation from discontinued operations $ — $ 371 Amortization from discontinued operations — 42,278 Gain on sale of business (1,004 ) — Asset impairment charges — 25,800 Reserve for excess or obsolete inventory — 876 Change in contingent consideration obligation — 8,743 Proceeds from sale of businesses 174,068 — Capital expenditures — 738 |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | The following table presents the consideration received, major classes of assets sold and the gain recognized on the sale of the Non-Core ACC Products: (in thousands) Sale price: Cash $ 263,807 Contingent purchase price from sale of business 65,700 Total sale price 329,507 Assets: Inventory 2,184 Intangibles 5,210 Goodwill 33,812 Total assets sold 41,206 Gain on sale of business $ 288,301 The following table presents key financial results of the infectious disease business included in “ Loss from discontinued operations, net of tax ” for years ended 2017 , 2016 and 2015 . Year Ended December 31, 2017 2016 2015 (In thousands) Net product revenues $ 34,622 $ 24,673 $ 14,460 Operating expenses: Cost of product revenue 20,060 10,693 15,945 Research and development 39,984 47,155 33,218 Selling, general and administrative 74,346 106,670 52,643 Total operating expenses 134,390 164,518 101,806 Loss from operations (99,768 ) (139,845 ) (87,346 ) Other expense, net (906 ) (19 ) 212 Loss from discontinued operations before income taxes (100,674 ) (139,864 ) (87,134 ) Provision (benefit) for income taxes 4 2 (10 ) Loss from discontinued operations, net of tax $ (100,678 ) $ (139,866 ) $ (87,124 ) The following table presents the major classes of assets and liabilities at December 31, 2017 and 2016 related to the infectious disease business which were reclassified as held for sale: December 31, December 31, 2017 2016 (In thousands) Assets: Accounts receivable, net $ 9,595 $ 3,916 Inventory 41,412 42,411 Other receivables 2,740 4,259 Intangibles, net 282,398 — Goodwill 55,057 — Current assets held for sale 391,202 50,586 Intangibles, net — 293,036 Goodwill — 55,057 Total assets held for sale $ 391,202 $ 398,679 Liabilities: Accounts payable $ 1,127 $ 7,872 Accrued expenses 22,945 21,686 Contingent purchase price – current 24,650 55,000 Deferred Revenue 723 2,467 Contingent purchase price – noncurrent 11,135 — Current liabilities held for sale 60,580 87,025 Contingent purchase price – noncurrent — 50,457 Total liabilities held for sale $ 60,580 $ 137,482 Depreciation and amortization was ceased upon determination that the held for sale criteria were met in the fourth quarter of 2017. The significant cash flow items from discontinued operations for years ended 2017 , 2016 and 2015 were as follows: Year Ended December 31, 2017 2016 2015 (In thousands) Amortization from discontinued operations $ 10,638 $ 17,858 $ 6,798 Changes in contingent purchase price (3,456 ) 53,249 1 Reserve for excess or obsolete inventory (435 ) (2,066 ) 4,228 Payments on contingent purchase price (63,066 ) (10,449 ) (18 ) The following table presents key financial results of the Hemostasis business included in “ Loss from discontinued operations, net of tax ” for years ended December 31, 2016 and 2015 . Year Ended December 31, 2016 2015 (In thousands) Net product revenues $ 1,275 $ 65,754 Operating expenses: Cost of product revenue 1,424 75,889 Research and development 90 7,568 Selling, general and administrative 542 560 Impairment — 133,266 Total operating expenses 2,056 217,283 Income (loss) from operations (781 ) (151,529 ) Gain from sale of business 1,004 — Other expense, net (39 ) (745 ) Income (loss) from discontinued operations before income taxes 184 (152,274 ) Benefit for income taxes — (21,448 ) Loss from discontinued operations, net of tax $ 184 $ (130,826 ) Cumulative translation adjustment (CTA) gains or losses of foreign subsidiaries related to divested businesses are reclassified into income once the liquidation of the respective foreign subsidiaries is substantially complete. At the completion of the sale of the Hemostasis Business, the Company reclassified $9.6 million , net of tax, of CTA gains from accumulated comprehensive loss to the Company’s results of discontinued operations. Of this amount, $8.4 million was included in the impairment loss recorded to reduce the Hemostasis Business disposal group’s carrying value to its estimated fair value, less costs to sell as of December 31, 2015 and $1.2 million was included in “Gain from sale of business” for the year ended December 31, 2016. Cost of product revenue for the three months ended September 30, 2015 included a charge of $25.8 million to reduce the carrying value of the product rights associated with PreveLeak to their estimated fair value as a result of a reduction in expected future cash flows. The significant cash flow items from discontinued operations for years ended December 31, 2016 and 2015 were as follows: Year Ended December 31, 2016 2015 (In thousands) Depreciation from discontinued operations $ — $ 371 Amortization from discontinued operations — 42,278 Gain on sale of business (1,004 ) — Asset impairment charges — 25,800 Reserve for excess or obsolete inventory — 876 Change in contingent consideration obligation — 8,743 Proceeds from sale of businesses 174,068 — Capital expenditures — 738 |
Nature of Business (Details)
Nature of Business (Details) | Jan. 05, 2018USD ($)positionshares | Jun. 19, 2017USD ($)position | Jun. 21, 2016USD ($)product | Feb. 01, 2016USD ($) | Jun. 30, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Proceeds from sale of businesses | $ 0 | $ 437,875,000 | $ 0 | ||||||
Contingent purchase price from sale of businesses | $ 143,700,000 | 80,700,000 | 143,700,000 | ||||||
Impairment charges | 392,097,000 | 0 | 0 | ||||||
Inventory write-off | 16,700,000 | 8,500,000 | |||||||
Severance costs | $ 5,800,000 | ||||||||
Impairment on divestiture | 0 | 0 | 133,273,000 | ||||||
Long-lived assets | 703,164,000 | 309,679,000 | 703,164,000 | ||||||
Increase (decrease) in contingent purchase price | (18,787,000) | 23,981,000 | 20,278,000 | ||||||
Chiesi [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Settlement payment | $ 7,500,000 | ||||||||
Discontinued operations, disposed of by sale [Member] | Hemostasis Business [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Proceeds from sale of businesses | $ 174,100,000 | 174,068,000 | 0 | ||||||
Contingent purchase price from sale of businesses | $ 235,000,000 | 78,000,000 | |||||||
Impairment charges | $ 0 | 133,266,000 | |||||||
Impairment of goodwill | $ 24,500,000 | ||||||||
Not discontinued operations, disposed of by sale [Member] | Non-Core ACC Products [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Proceeds from sale of businesses | $ 263,807,000 | ||||||||
Contingent purchase price from sale of businesses | $ 480,000,000 | $ 65,700,000 | |||||||
Number of products sold | product | 3 | ||||||||
Total sale price | $ 329,507,000 | ||||||||
Disposal Group, Disposed of by Means Other than Sale, Not Discontinued Operations, Abandonment [Member] | Development of MDCO-700 [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Increase (decrease) in contingent purchase price | $ (14,700,000) | ||||||||
Contingent consideration | 0 | ||||||||
Benefit for income taxes | 23,000,000 | ||||||||
Disposal Group, Disposed of by Means Other than Sale, Not Discontinued Operations, Abandonment [Member] | Ionsys [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Impairment charges | 268,100,000 | ||||||||
Inventory write-off | 5,300,000 | ||||||||
Number of positions eliminated due to restructuring | position | 57 | ||||||||
Percentage of positions eliminated | 15.00% | ||||||||
Settlement and impairment provisions | 276,900,000 | ||||||||
Severance costs | 8,800,000 | ||||||||
Impairment on divestiture | 11,400,000 | ||||||||
Long-lived assets | 0 | ||||||||
In-process research and development [Member] | Disposal Group, Disposed of by Means Other than Sale, Not Discontinued Operations, Abandonment [Member] | Development of MDCO-700 [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Asset impairment charges | $ 65,000,000 | ||||||||
Subsequent Event [Member] | Not discontinued operations, disposed of by sale [Member] | Infectious Disease Business [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Number of positions eliminated due to restructuring | position | 36 | ||||||||
Total sale price | $ 166,400,000 | ||||||||
Consideration received (in shares) | shares | 3,313,702 | ||||||||
Market value of closing share price | $ 54,500,000 | ||||||||
Cash payment 12 months after transaction close | 25,000,000 | ||||||||
Cash payment 18 months after transaction close | $ 25,000,000 | ||||||||
Minimum [Member] | Subsequent Event [Member] | Not discontinued operations, disposed of by sale [Member] | Infectious Disease Business [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Tiered royalty payments percentage | 5.00% | ||||||||
Maximum [Member] | Subsequent Event [Member] | Not discontinued operations, disposed of by sale [Member] | Infectious Disease Business [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Tiered royalty payments percentage | 25.00% |
Significant Accounting Polici52
Significant Accounting Policies - Sales Allowances and Accruals (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Cash Discounts [Member] | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance beginning of period | $ 281 | $ 887 | $ 4,142 |
Allowances for sales, current period | 1,746 | 1,854 | 9,212 |
Actual credits issued for prior year’s sales | (281) | (887) | (3,927) |
Actual credits issued for sales, current period | (775) | (1,573) | (8,540) |
Balance end of period | 971 | 281 | 887 |
Returns [Member] | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance beginning of period | 1,584 | 8,743 | 3,349 |
Allowances for sales, current period | 4,439 | (1,424) | 12,143 |
Actual credits issued for prior year’s sales | (1,464) | (5,233) | (3,528) |
Actual credits issued for sales, current period | (220) | (502) | (3,221) |
Balance end of period | 4,339 | 1,584 | 8,743 |
Chargebacks [Member] | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance beginning of period | 1,895 | 15,716 | 44,399 |
Allowances for sales, current period | 17,395 | 36,197 | 107,564 |
Actual credits issued for prior year’s sales | (1,246) | (15,610) | (40,419) |
Actual credits issued for sales, current period | (12,172) | (34,408) | (95,828) |
Balance end of period | 5,872 | 1,895 | 15,716 |
Rebates [Member] | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance beginning of period | 15 | 100 | 0 |
Allowances for sales, current period | 271 | (6) | 833 |
Actual credits issued for prior year’s sales | (15) | (50) | 0 |
Actual credits issued for sales, current period | (126) | (29) | (733) |
Balance end of period | 145 | 15 | 100 |
Fees-for-Service [Member] | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance beginning of period | 826 | 2,680 | 924 |
Allowances for sales, current period | 3,085 | 3,166 | 14,249 |
Actual credits issued for prior year’s sales | (865) | (2,655) | (1,179) |
Actual credits issued for sales, current period | (2,152) | (2,365) | (11,314) |
Balance end of period | $ 894 | $ 826 | $ 2,680 |
Significant Accounting Polici53
Significant Accounting Policies - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Significant Accounting Policies [Line Items] | |||||
Accumulated deficit | $ (1,257,356) | $ (1,257,356) | $ (548,983) | ||
Concentration of risk, cash and cash equivalents | 12,100 | 12,100 | 56,100 | ||
Royalty revenues | $ 25,809 | 71,205 | $ 53,859 | ||
Product return period | 18 months | ||||
Product return period prior to label expiration date | 6 months | ||||
Product return period after label expiration date | 12 months | ||||
Accrual for product returns | 4,300 | $ 4,300 | 1,600 | ||
Allowance for chargebacks | 5,900 | $ 5,900 | 1,900 | ||
Fees for service discount settlement period | 60 days | ||||
Fee-for-service accruals and allowances | 900 | $ 900 | 800 | ||
Advertising costs | 0 | 0 | 1,200 | ||
Reimbursement by government | 9,000 | 15,800 | 22,500 | ||
Cash and cash equivalents | 151,359 | 151,359 | 541,835 | 373,173 | $ 370,741 |
International [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Revenues | 200 | 1,100 | $ 1,100 | ||
Angiomax [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Deferred revenue | 200 | $ 200 | $ 1,700 | ||
Minimum selling price | 50.00% | ||||
Integrated Commercialization Solutions, Inc. [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Revenue agreement, renewal term | 1 year | ||||
Revenue agreement, renewal notice period | 90 days | ||||
Revenue agreement, termination notice period | 180 days | ||||
Integrated Commercialization Solutions, Inc. [Member] | Customer concentration risk [Member] | Net product revenues [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Concentration risk, percentage | 5.00% | 48.00% | 87.00% | ||
Integrated Commercialization Solutions, Inc. [Member] | Customer concentration risk [Member] | Gross accounts receivable [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Concentration risk, percentage | 27.00% | 11.00% | |||
Accounts receivable, gross | 2,900 | $ 2,900 | $ 2,200 | ||
Sandoz [Member] | Customer concentration risk [Member] | Net product revenues [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Concentration risk, percentage | 55.00% | 23.00% | |||
Sandoz [Member] | Customer concentration risk [Member] | Gross accounts receivable, related to product sales [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Concentration risk, percentage | 8.00% | 27.00% | |||
Accounts receivable, gross | 900 | $ 900 | $ 5,600 | ||
Sandoz [Member] | Customer concentration risk [Member] | Gross accounts receivable, related to royalty revenues [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Concentration risk, percentage | 40.00% | 43.00% | |||
Accounts receivable, gross | 4,200 | $ 4,200 | $ 9,100 | ||
Hemostasis Business [Member] | Discontinued operations, disposed of by sale [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Change in carrying value of contingent purchase price | $ 63,000 | ||||
Accounting Standards Update 2016-09 [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Employee Service Share-based Compensation, Tax Benefit from Compensation Expense | $ 3,000 |
Inventory (Details)
Inventory (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 1,389 | $ 18,714 |
Work-in-progress | 3,608 | 8,397 |
Finished goods | 562 | 1,375 |
Total | 5,559 | 28,486 |
Inventory write-down, obsolescence | $ 16,700 | $ 8,500 |
Fixed Assets (Details)
Fixed Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Line Items] | |||
Fixed assets, gross | $ 60,245 | $ 63,351 | |
Less: Accumulated depreciation | (42,991) | (32,390) | |
Fixed assets, net | 17,254 | 30,961 | |
Depreciation expense | 6,800 | 4,500 | $ 5,100 |
Furniture, fixtures and equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Fixed assets, gross | 20,603 | 25,132 | |
Computer software [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Fixed assets, gross | 3,524 | 3,722 | |
Computer hardware [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Fixed assets, gross | 3,054 | 3,795 | |
Leasehold improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Fixed assets, gross | $ 33,064 | $ 30,702 | |
Minimum [Member] | Furniture, fixtures and equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated life | 2 years | ||
Minimum [Member] | Computer software [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated life | 2 years | ||
Minimum [Member] | Computer hardware [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated life | 2 years | ||
Minimum [Member] | Leasehold improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated life | 2 years | ||
Maximum [Member] | Furniture, fixtures and equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated life | 15 years | ||
Maximum [Member] | Computer software [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated life | 5 years | ||
Maximum [Member] | Computer hardware [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated life | 5 years | ||
Maximum [Member] | Leasehold improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated life | 15 years |
Cash, Cash Equivalents and Re56
Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Cash and Cash Equivalents [Line Items] | ||||
Cash and cash equivalents | $ 151,359 | $ 541,835 | $ 373,173 | $ 370,741 |
Cash | 139,300 | 485,700 | ||
Restricted Cash | ||||
Restricted cash | 5,541 | 5,032 | ||
Restricted cash and cash equivalents, outstanding letter of credit associated with foreign taxes | 4,100 | 3,700 | ||
Restricted cash outstanding letters of credit used for collateral | 1,000 | 1,000 | ||
Restricted cash guaranteed investment certificate used for collateral | 200 | 100 | ||
Restricted cash and cash equivalents, foreign tender | 300 | 200 | ||
Money Market Funds | ||||
Cash and Cash Equivalents [Line Items] | ||||
Cash equivalents | $ 12,100 | $ 56,100 |
Acquisition - Additional Inform
Acquisition - Additional Information (Details) - USD ($) $ in Thousands | Feb. 02, 2015 | Jun. 30, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Business Acquisition [Line Items] | |||||
Increase (decrease) in contingent purchase price | $ (18,787) | $ 23,981 | $ 20,278 | ||
Annovation [Member] | |||||
Business Acquisition [Line Items] | |||||
Payment to acquire businesses | $ 28,397 | ||||
Contingent consideration | $ 26,300 | ||||
Percentage ownership in acquiree prior to acquisition | 35.80% | ||||
Fair value of existing equity interest | $ 25,886 | ||||
Gain on remeasurement of equity investment | 22,700 | ||||
Annovation [Member] | General Hospital Corporation [Member] | |||||
Business Acquisition [Line Items] | |||||
Contingent consideration | $ 6,500 | ||||
Royalty obligation term | 10 years | ||||
Disposal Group, Disposed of by Means Other than Sale, Not Discontinued Operations, Abandonment [Member] | Development of MDCO-700 [Member] | |||||
Business Acquisition [Line Items] | |||||
Contingent consideration | $ 0 | ||||
Increase (decrease) in contingent purchase price | (14,700) | ||||
Benefit for income taxes | (23,000) | ||||
In-process research and development [Member] | Disposal Group, Disposed of by Means Other than Sale, Not Discontinued Operations, Abandonment [Member] | Development of MDCO-700 [Member] | |||||
Business Acquisition [Line Items] | |||||
Asset impairment charges | $ 65,000 |
Acquisition - Purchase Price (D
Acquisition - Purchase Price (Details) - Annovation [Member] $ in Thousands | Feb. 02, 2015USD ($) |
Business Acquisition [Line Items] | |
Upfront cash consideration | $ 28,397 |
Fair value of existing equity interest in Annovation | 25,886 |
Total cash consideration and fair value of existing equity interest | 54,283 |
Fair value of contingent purchase price | 18,000 |
Total purchase price | $ 72,283 |
Acquisition - Assets Acquired a
Acquisition - Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Feb. 02, 2015 |
Business Acquisition [Line Items] | |||
Goodwill | $ 200,571 | $ 200,571 | |
Annovation [Member] | |||
Business Acquisition [Line Items] | |||
Cash and cash equivalents | $ 1,482 | ||
Other current assets | 692 | ||
IPR&D | 65,000 | ||
Goodwill | 24,530 | ||
Total assets | 91,704 | ||
Accrued expenses | 398 | ||
Contingent purchase price | 18,000 | ||
Deferred tax liability | 19,023 | ||
Total liabilities | 37,421 | ||
Total cash price paid upon acquisition and fair value of existing equity interest | $ 54,283 |
Intangible Assets and Goodwil60
Intangible Assets and Goodwill - Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Indefinite-lived Intangible Assets [Line Items] | ||
Intangible assets not subject to amortization | $ 0 | $ 65,000 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 0 | 280,000 |
Accumulated Amortization | 0 | (22,815) |
Net Carrying Amount | 0 | 257,185 |
Intangible assets | 0 | 345,000 |
Intangible assets, net | 0 | 322,185 |
In-process research and development [Member] | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Intangible assets not subject to amortization | 0 | 65,000 |
Developed product rights [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 0 | 250,000 |
Accumulated Amortization | 0 | (19,802) |
Net Carrying Amount | 0 | 230,198 |
Product licenses [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 0 | 30,000 |
Accumulated Amortization | 0 | (3,013) |
Net Carrying Amount | $ 0 | $ 26,987 |
Intangible Assets and Goodwil61
Intangible Assets and Goodwill - Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Jun. 30, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |
Goodwill [Roll Forward] | |||
Balance at beginning of period | $ 200,571 | ||
Balance at end of period | 200,571 | $ 200,571 | |
Not discontinued operations, disposed of by sale [Member] | Non-Core ACC Products [Member] | |||
Goodwill [Roll Forward] | |||
Balance at beginning of period | 200,571 | 234,383 | |
Allocation of goodwill to sale | $ (33,800) | 0 | (33,812) |
Balance at end of period | $ 200,571 | $ 200,571 |
Intangible Assets and Goodwil62
Intangible Assets and Goodwill - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||
Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Jun. 21, 2016 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Amortizable intangible assets, net | $ 0 | $ 257,185 | ||||
Intangible assets not subject to amortization | 0 | 65,000 | ||||
Intangible assets, amortization expense | 4,500 | 17,500 | $ 10,000 | |||
Non-Core ACC Products [Member] | Not discontinued operations, disposed of by sale [Member] | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Intangibles | $ 5,210 | |||||
Goodwill allocated to sale | $ 33,800 | 0 | 33,812 | |||
Goodwill | $ 33,812 | |||||
Infectious Disease Business [Member] | Not discontinued operations, disposed of by sale [Member] | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Goodwill | 0 | 55,057 | ||||
Developed product rights [Member] | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Amortizable intangible assets, net | 0 | 230,198 | ||||
Developed product rights [Member] | Ionsys [Member] | Disposal Group, Disposed of by Means Other than Sale, Not Discontinued Operations, Abandonment [Member] | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Impairment charge | $ 226,500 | |||||
Product licenses [Member] | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Amortizable intangible assets, net | 0 | 26,987 | ||||
Product licenses [Member] | Ionsys [Member] | Disposal Group, Disposed of by Means Other than Sale, Not Discontinued Operations, Abandonment [Member] | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Impairment charge | 26,200 | |||||
Product licenses [Member] | Development of MDCO-700 [Member] | Disposal Group, Disposed of by Means Other than Sale, Not Discontinued Operations, Abandonment [Member] | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Amortizable intangible assets, net | 0 | |||||
In-process research and development [Member] | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Intangible assets not subject to amortization | 0 | $ 65,000 | ||||
In-process research and development [Member] | Development of MDCO-700 [Member] | Disposal Group, Disposed of by Means Other than Sale, Not Discontinued Operations, Abandonment [Member] | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Asset impairment charges | $ 65,000 | |||||
Intangible assets not subject to amortization | $ 0 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Other Liabilities Disclosure [Abstract] | ||
Royalties | $ 1,039 | $ 739 |
Research and development services | 43,496 | 11,477 |
Compensation related | 25,621 | 28,802 |
Product returns, rebates and other fees | 5,363 | 2,336 |
Legal, accounting and other | 6,162 | 4,821 |
Manufacturing, logistics and related fees | 1,984 | 6,200 |
Sales and marketing | 1,875 | 1,575 |
Interest | 9,657 | 10,888 |
Total | $ 95,197 | $ 66,838 |
Convertible Senior Notes - Due
Convertible Senior Notes - Due 2023 (Details) | 1 Months Ended | 12 Months Ended | ||
Jun. 30, 2016USD ($)day$ / shares | Dec. 31, 2017USD ($)$ / shares | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Debt Instrument [Line Items] | ||||
Net deferred tax liabilities | $ 0 | $ 89,992,000 | ||
Interest expense | ||||
Amortization of debt discount | 26,868,000 | 26,182,000 | $ 23,676,000 | |
Senior Notes [Member] | Convertible Senior Notes Due 2023 [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal | $ 402,500,000 | 402,500,000 | 402,500,000 | |
Interest rate | 2.75% | |||
Proceeds from offering | $ 390,800,000 | |||
Trading period | day | 20 | |||
Redemption consecutive trading period | 30 days | |||
Redemption stock price conversion threshold (greater than or equal to) | 130.00% | |||
Consecutive measurement period | 5 days | |||
Percent of trading price (less than) | 98.00% | |||
Consecutive trading period | day | 50 | |||
Conversion ratio | 0.0204198 | |||
Conversion price (usd per share) | $ / shares | $ 48.97 | |||
Redemption trading period | 19 days | |||
Percent of principal amount plus accrued and unpaid interest | 100.00% | |||
Debt default principal amount percentage | 25.00% | |||
Debt instrument, term | 7 years | |||
Carrying amount of equity component | $ 101,000,000 | |||
Net deferred tax liabilities | 33,500,000 | |||
Liability component | ||||
Principal | 402,500,000 | 402,500,000 | 402,500,000 | |
Less: Debt discount, net | (90,552,000) | (103,162,000) | ||
Net carrying amount | $ 311,948,000 | 299,338,000 | ||
Remaining contractual life | 5 years 6 months | |||
Interest expense | ||||
Contractual interest expense | $ 11,060,000 | 6,158,000 | 0 | |
Amortization of debt discount | 12,610,000 | 6,648,000 | 0 | |
Total | $ 23,670,000 | $ 12,806,000 | $ 0 | |
Effective interest rate of the liability component | 7.50% | 7.50% | 0.00% | |
Senior Notes [Member] | Convertible Senior Notes Due 2023 [Member] | Capped call [Member] | ||||
Interest expense | ||||
Payment of cost of capped call transactions | $ 33,900,000 | |||
Cap price (usd per share) | $ / shares | $ 64.68 | |||
Senior Notes [Member] | Convertible Senior Notes Due 2023 [Member] | Level 2 [Member] | ||||
Liability component | ||||
Fair value of Notes | $ 377,100,000 |
Convertible Senior Notes - Du65
Convertible Senior Notes - Due 2022 (Details) | 1 Months Ended | 12 Months Ended | ||
Jan. 31, 2015USD ($)day$ / shares | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Debt Instrument [Line Items] | ||||
Net deferred tax liabilities | $ 0 | $ 89,992,000 | ||
Interest expense | ||||
Amortization of debt discount | 26,868,000 | 26,182,000 | $ 23,676,000 | |
Senior Notes [Member] | Convertible Senior Notes Due 2022 [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal | $ 400,000,000 | 399,997,000 | 400,000,000 | |
Interest rate | 2.50% | |||
Proceeds from offering | $ 387,200,000 | |||
Trading period | day | 20 | |||
Redemption consecutive trading period | 30 days | |||
Redemption stock price conversion threshold (greater than or equal to) | 130.00% | |||
Consecutive measurement period | 5 days | |||
Percent of trading price (less than) | 98.00% | |||
Conversion ratio | 0.0298806 | |||
Conversion price (usd per share) | $ / shares | $ 33.47 | |||
Redemption trading period | 19 days | |||
Percent of principal amount plus accrued and unpaid interest | 100.00% | |||
Debt default principal amount percentage | 25.00% | |||
Debt instrument, term | 7 years | |||
Carrying amount of equity component | $ 88,900,000 | |||
Net deferred tax liabilities | 31,800,000 | |||
Liability component | ||||
Principal | $ 400,000,000 | 399,997,000 | 400,000,000 | |
Less: Debt discount, net | (62,747,000) | (75,754,000) | ||
Net carrying amount | $ 337,250,000 | 324,246,000 | ||
Remaining contractual life | 4 years | |||
Interest expense | ||||
Contractual interest expense | $ 10,000,000 | 10,000,000 | 9,639,000 | |
Amortization of debt discount | 13,007,000 | 12,139,000 | 10,942,000 | |
Total | $ 23,007,000 | $ 22,139,000 | $ 20,581,000 | |
Effective interest rate of the liability component | 6.50% | 6.50% | 0.00% | |
Senior Notes [Member] | Convertible Senior Notes Due 2022 [Member] | Level 2 [Member] | ||||
Liability component | ||||
Fair value of Notes | $ 417,600,000 |
Convertible Senior Notes - Du66
Convertible Senior Notes - Due 2017 (Details) | Jun. 01, 2017USD ($)shares | Jun. 30, 2016USD ($) | Jun. 30, 2012USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) |
Debt Instrument [Line Items] | |||||||
Debt, repurchase amount | $ 55,000,000 | $ 323,225,000 | $ 0 | ||||
Loss on extinguishment of debt | 0 | 5,380,000 | 0 | ||||
Reduction of additional paid-in capital for difference between consideration transferred and fair value of liability component | (3,000) | 108,725,000 | |||||
Interest expense | |||||||
Amortization of debt discount | 26,868,000 | 26,182,000 | 23,676,000 | ||||
Senior Notes [Member] | Convertible Senior Notes Due 2017 [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Number of trading days prior to maturity date | 2 days | ||||||
Conversion ratio | 0.0358038 | ||||||
Principal | $ 275,000,000 | $ 0 | 0 | 55,000,000 | |||
Interest rate | 1.375% | ||||||
Proceeds from offering | $ 266,200,000 | ||||||
Debt, repurchase amount | $ 55,400,000 | $ 323,200,000 | |||||
Debt, aggregate principal amount repurchased | 220,000,000 | ||||||
Cash receipt for settlement of outstanding bond hedges and warrants | $ 12,600,000 | ||||||
Loss on extinguishment of debt | 5,400,000 | ||||||
Reduction of additional paid-in capital for difference between consideration transferred and fair value of liability component | 108,700,000 | ||||||
Common stock received upon settlement (in shares) | shares | 819,901 | ||||||
Liability component | |||||||
Principal | $ 275,000,000 | 0 | 0 | 55,000,000 | |||
Less: Debt discount, net | 0 | 0 | (1,251,000) | ||||
Net carrying amount | $ 0 | 0 | 53,749,000 | ||||
Interest expense | |||||||
Contractual interest expense | 315,000 | 2,101,000 | 3,781,000 | ||||
Amortization of debt discount | 1,251,000 | 7,395,000 | 12,734,000 | ||||
Total | $ 1,566,000 | $ 9,496,000 | $ 16,515,000 | ||||
Effective interest rate of the liability component | 6.02% | 6.02% | 6.02% | 6.02% |
Convertible Senior Notes - Note
Convertible Senior Notes - Note Hedges (Details) - USD ($) $ / shares in Units, $ in Thousands | Jun. 01, 2017 | Jun. 30, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Jun. 30, 2012 |
Debt Instrument [Line Items] | ||||||
Proceeds from settlement of bond hedges related to convertible senior notes | $ 0 | $ 100,459 | $ 0 | |||
Interest Rate Contract [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Aggregate amount of hedge | $ 58,200 | |||||
Shares exercisable upon conversion | 2,000,000 | |||||
Common stock received upon settlement (in shares) | 820,161 | |||||
Common stock received upon settlement (usd per share) | $ 48.79 | |||||
Senior Notes [Member] | Convertible Senior Notes Due 2017 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt, aggregate principal amount repurchased | $ 220,000 | |||||
Proceeds from settlement of bond hedges related to convertible senior notes | $ 100,500 | |||||
Common stock received upon settlement (in shares) | 819,901 |
Convertible Senior Notes - Warr
Convertible Senior Notes - Warrants (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2012 | Dec. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Debt Instrument [Line Items] | ||||||
Settlement of warrants | $ (2) | $ (87,874) | $ 0 | |||
2017 Warrants [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Proceeds from sale of warrants | $ 38,400 | |||||
Shares exercisable upon conversion | 2,000,000 | |||||
Exercise price of warrants (usd per share) | $ 34.20 | |||||
Warrants exercised (in shares) | 787,680 | |||||
Issuance of common stock (in shares) | 44,283 | |||||
Senior Notes [Member] | Convertible Senior Notes Due 2017 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt, aggregate principal amount repurchased | $ 220,000 | |||||
Settlement of warrants | $ (87,900) |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) | Jun. 01, 2017 | Aug. 31, 2015 | Jun. 30, 2013 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | May 29, 2015 | Jun. 05, 2012 |
Class of Stock [Line Items] | ||||||||
Preferred stock, authorized (in shares) | 5,000,000 | 5,000,000 | ||||||
Preferred stock, issued (in shares) | 0 | 0 | ||||||
Employee stock purchase (in shares) | 1,949,117 | 1,312,812 | 2,989,324 | |||||
Employee stock purchases | $ 48,621,000 | $ 33,776,000 | $ 65,238,000 | |||||
Issuance of restricted stock awards (in shares) | 166,103 | 132,344 | 166,042 | |||||
Common stock, authorized (in shares) | 187,500,000 | 187,500,000 | 125,000,000 | 187,500,000 | ||||
Issuance of common stock | $ 29,964,000 | |||||||
Stock repurchase program, authorized amount | $ 50,000,000 | |||||||
Repurchase of common stock (in shares) | 2,192,982 | |||||||
Repurchase of common stock | $ 50,000,000 | |||||||
Common stock held in treasury (in shares) | 3,013,143 | 2,192,982 | ||||||
Common Stock [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Employee stock purchase (in shares) | 1,949,000 | 1,313,000 | 2,989,000 | |||||
Employee stock purchases | $ 2,000 | $ 1,000 | $ 3,000 | |||||
Issuance of restricted stock awards (in shares) | 166,000 | 132,000 | 166,000 | |||||
Issuance of common stock (in shares) | 944,537 | 945,000 | ||||||
Issuance of common stock | $ 30,000,000 | $ 1,000 | ||||||
Common stock received upon settlement (in shares) | (820,000) | |||||||
Interest Rate Contract [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Common stock received upon settlement (in shares) | 820,161 | |||||||
Common stock received upon settlement (usd per share) | $ 48.79 |
Share-Based Compensation - Stoc
Share-Based Compensation - Stock Option Activity (Details) | 12 Months Ended |
Dec. 31, 2017USD ($)$ / sharesshares | |
Employee stock options [Member] | |
Number of Shares | |
Balance (shares) | 8,023,696 |
Granted (shares) | 1,693,309 |
Exercised (shares) | (1,854,644) |
Forfeited and expired (shares) | (818,871) |
Balance (shares) | 7,043,490 |
Vested and expected to vest (shares) | 6,842,097 |
Exercisable (shares) | 4,190,582 |
Weighted-Average Exercise Price Per Share | |
Balance (usd per share) | $ / shares | $ 28.27 |
Granted (usd per share) | $ / shares | 49.89 |
Exercised (usd per share) | $ / shares | 24.57 |
Forfeited and expired (usd per share) | $ / shares | 37.24 |
Balance (usd per share) | $ / shares | 33.40 |
Vested and expected to vest (usd per share) | $ / shares | 33.13 |
Exercisable (usd per share) | $ / shares | $ 28.97 |
Weighted- Average Remaining Contractual Term (Years) | |
Outstanding | 5 years 10 months 5 days |
Vested and expected to vest | 5 years 9 months 22 days |
Exercisable | 5 years 20 days |
Aggregate Intrinsic Value | |
Outstanding | $ | $ 11,705,399 |
Vested and expected to vest | $ | 11,699,950 |
Exercisable | $ | $ 11,487,732 |
2013 Plan [Member] | |
Number of Shares | |
Available for future grant (shares) | 3,202,401 |
Share-Based Compensation - Weig
Share-Based Compensation - Weighted Average Assumptions (Details) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Expected stock price volatility | 39.14% | 37.90% | 41.49% |
Risk-free interest rate | 1.867% | 1.249% | 1.436% |
Expected option term | 5 years | 4 years 11 months 5 days | 5 years 4 days |
2010 ESPP [Member] | Employee stock purchase plan shares [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Expected stock price volatility | 43.03% | 48.80% | 44.91% |
Risk-free interest rate | 0.89% | 0.34% | 0.15% |
Expected option term | 6 months | 6 months | 6 months |
Share-Based Compensation - Rest
Share-Based Compensation - Restricted Stock Awards (Details) - Restricted stock [Member] - $ / shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Number of Shares | |||
Balance (shares) | 375,301 | ||
Awarded (shares) | 196,462 | ||
Vested (shares) | (172,076) | ||
Forfeited (shares) | (30,359) | ||
Balance (shares) | 369,328 | 375,301 | |
Weighted Average Grant-Date Fair Value | |||
Balance (usd per share) | $ 31.88 | ||
Awarded (usd per share) | 50.51 | $ 33.63 | $ 28.37 |
Vested (usd per share) | 32.80 | ||
Forfeited (usd per share) | 44.03 | ||
Balance (usd per share) | $ 40.37 | $ 31.88 |
Share-Based Compensation - Addi
Share-Based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 31.5 | $ 31 | $ 30.6 |
Unrecognized compensation costs | $ 27.8 | ||
Unrecognized compensation cost, non-vested awards, period of recognition | 1 year 2 months 19 days | ||
Weighted average grant date fair value (usd per share) | $ 18.46 | $ 11.72 | $ 11.18 |
Intrinsic value, exercised in period | $ 34.1 | $ 12.7 | $ 40 |
Employee stock options [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock option term | 10 years | ||
Vesting percentage | 25.00% | ||
Vesting period | 4 years | ||
Share-based compensation expense | $ 22.6 | 23.2 | 23 |
Unrecognized compensation cost, non-vested awards, period of recognition | 1 year 3 months | ||
Unrecognized compensation cost, options, period of recognition | $ 21.4 | ||
Employee stock options [Member] | Tranche One [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 1 year | ||
Employee stock options [Member] | Tranche Two [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Director stock options [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 1 year | ||
Restricted stock [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting percentage | 25.00% | ||
Cumulative awards granted (shares) | 28,493,250 | ||
Outstanding awards (shares) | 7,043,490 | ||
Share-based compensation expense | $ 6.5 | $ 6.6 | $ 6.1 |
Unrecognized compensation costs | $ 6.3 | ||
Unrecognized compensation cost, non-vested awards, period of recognition | 1 year 1 month 18 days | ||
Weighted average grant date fair value of shares awarded (usd per share) | $ 50.51 | $ 33.63 | $ 28.37 |
Shares vested in period, fair value | $ 8.4 | $ 8.7 | $ 7.1 |
2010 ESPP [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares authorized (shares) | 2,000,000 | ||
Percentage discount from offering date | 85.00% | ||
Maximum employee subscription rate | 5.00% | ||
Available for future grant (shares) | 972,959 | ||
2010 ESPP [Member] | Employee stock purchase plan shares [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 1 | $ 1.2 | $ 1.5 |
Stock issued (shares) | 94,473 | 136,378 | 184,432 |
Offering period | 6 months | ||
2013 Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Available for future grant (shares) | 3,202,401 |
Earnings per Share (Details)
Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | Jun. 01, 2017 | 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 | Jun. 30, 2012 |
Amounts attributable to The Medicines Company: | |||||||||||||
(Loss) income from continuing operations | $ (159,416) | $ (7,218) | $ (370,065) | $ (70,996) | $ (82,779) | $ (31,444) | $ 201,912 | $ (67,125) | $ (607,695) | $ 20,564 | $ (134,806) | ||
Loss from discontinued operations, net of tax | (18,844) | (22,957) | (27,203) | (31,674) | (40,073) | (54,815) | (19,470) | (25,324) | (100,678) | (139,682) | (217,950) | ||
Net loss attributable to The Medicines Company | $ (178,260) | $ (30,175) | $ (397,268) | $ (102,670) | $ (122,852) | $ (86,259) | $ 182,442 | $ (92,449) | $ (708,373) | $ (119,118) | $ (352,756) | ||
Weighted average common shares outstanding, basic (shares) | 72,356,000 | 69,909,000 | 66,809,000 | ||||||||||
Plus: net effect of dilutive stock options, warrants, restricted common shares and shares issuable upon conversion of Notes (shares) | 0 | 3,113,000 | 0 | ||||||||||
Weighted average common shares outstanding, diluted (shares) | 72,356,000 | 73,022,000 | 66,809,000 | ||||||||||
Basic (loss) earnings per common share attributable to The Medicines Company: | |||||||||||||
(Loss) income from continuing operations (usd per share) | $ (8.40) | $ 0.29 | $ (2.02) | ||||||||||
Income (loss) from discontinued operations (usd per share) | (1.39) | (2) | (3.26) | ||||||||||
Basic loss per share (usd per share) | (9.79) | (1.71) | (5.28) | ||||||||||
Diluted (loss) earnings per common share attributable to The Medicines Company: | |||||||||||||
(Loss) income from continuing operations (usd per share) | $ (2.19) | $ (0.10) | $ (5.15) | $ (1) | $ (1.17) | $ (0.45) | $ 2.78 | $ (0.97) | (8.40) | 0.28 | (2.02) | ||
Income (loss) from discontinued operations (usd per share) | (0.26) | (0.31) | (0.38) | (0.45) | (0.57) | (0.78) | (0.27) | (0.37) | (1.39) | (1.91) | (3.26) | ||
Diluted loss per share (usd per share) | $ (2.45) | $ (0.41) | $ (5.53) | $ (1.45) | $ (1.74) | $ (1.23) | $ 2.51 | $ (1.34) | $ (9.79) | $ (1.63) | $ (5.28) | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||||||||
Antidilutive shares excluded from computation of earnings per share (in shares) | 12,803,033 | ||||||||||||
2017 Warrants [Member] | |||||||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||||||||
Shares exercisable upon conversion | 2,000,000 | ||||||||||||
Exercise price of warrants (usd per share) | $ 34.20 | ||||||||||||
Restricted stock [Member] | |||||||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||||||||
Antidilutive shares excluded from computation of earnings per share (in shares) | 3,724,272 | ||||||||||||
Convertible Senior Notes Due 2023 [Member] | Senior Notes [Member] | Capped call [Member] | |||||||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||||||||
Strike price, capped calls (usd per share) | $ 48.97 | ||||||||||||
Cap price (usd per share) | $ 64.68 | ||||||||||||
Convertible Senior Notes Due 2017 [Member] | Senior Notes [Member] | |||||||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||||||||
Debt, aggregate principal amount repurchased | $ 220,000 | ||||||||||||
Common stock received upon settlement (in shares) | 819,901 | ||||||||||||
Interest Rate Contract [Member] | |||||||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||||||||
Shares exercisable upon conversion | 2,000,000 | ||||||||||||
Common stock received upon settlement (in shares) | 820,161 | ||||||||||||
Common stock received upon settlement (usd per share) | $ 48.79 |
Income Taxes - Benefit From (Pr
Income Taxes - Benefit From (Provision) Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Current: | |||
Federal | $ 4,859 | $ 0 | $ (5) |
State | (31) | (33) | (182) |
Foreign | 1,757 | (34) | (229) |
Total current | 6,585 | (67) | (416) |
Deferred: | |||
Federal | 88,556 | 0 | 28,011 |
State | 1,435 | 0 | 2,138 |
Foreign | 0 | 0 | 0 |
Total deferred | 89,991 | 0 | 30,149 |
Total benefit from (provision for) taxes | $ 96,576 | $ (67) | $ 29,733 |
Income Taxes - Components of In
Income Taxes - Components of Income Before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ (704,814) | $ 22,289 | $ (163,772) |
International | 543 | (1,712) | (757) |
Total | $ (704,271) | $ 20,577 | $ (164,529) |
Income Taxes - Effective Income
Income Taxes - Effective Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Statutory rate applied to pre-tax (loss) income from continuing operations | $ (246,495) | $ 7,202 | $ (57,589) |
Effective Income Tax Rate Reconciliation, Amount [Abstract] | |||
State income taxes, net of federal benefit | (913) | 21 | (1,273) |
Foreign | 53 | 442 | 287 |
Revaluation of contingent purchase price | (5,366) | (10,244) | 10,272 |
Tax credits | (3,539) | (967) | (305) |
Lobbying costs | 0 | 0 | 35 |
Meals and entertainment | 372 | 605 | 810 |
Uncertain tax positions | (1,635) | (2,064) | 61 |
Bargain purchase | 0 | 0 | (7,310) |
Loss on extinguishment of debt | 0 | 1,403 | 0 |
Loss on ACC goodwill | 0 | 11,834 | 0 |
Excess stock option benefit | (4,589) | 0 | 0 |
Change in federal tax rate due to the Tax Cuts and Jobs Act | 126,502 | 0 | 0 |
Other | 785 | (485) | 1,239 |
Tax benefit of operating loss carryforwards | 11,509 | (105,045) | 0 |
Valuation allowances | 26,740 | 97,365 | 24,040 |
Income tax benefit | $ (96,576) | $ 67 | $ (29,733) |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Deferred tax assets: | ||
Net operating loss carryforwards | $ 235,852 | $ 230,775 |
Tax credits | 20,096 | 20,973 |
Stock based compensation | 19,611 | 28,268 |
Other | 26,113 | 26,889 |
Total deferred tax assets | 301,672 | 306,905 |
Valuation allowance | (239,536) | (162,892) |
Total deferred tax assets net of valuation allowance | 62,136 | 144,013 |
Deferred tax liabilities: | ||
Fixed assets | (568) | (4,997) |
Intangible assets | (30,664) | (81,877) |
Convertible debt | (30,904) | (57,430) |
Indefinite lived intangible assets | 0 | (89,701) |
Total deferred tax liabilities | (62,136) | (234,005) |
Net deferred tax liabilities | $ 0 | $ (89,992) |
Income Taxes - Net Operating Lo
Income Taxes - Net Operating Loss and Tax Credit Carryforwards, Expiration (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Tax Credit Carryforward [Line Items] | |
Federal net operating loss carryforwards | $ 1,007,303 |
Federal Research and Development Tax Credit Carryforwards [Member] | |
Tax Credit Carryforward [Line Items] | |
Tax credit carryforwards | 23,067 |
Year of Expiration 2027 [Member] | |
Tax Credit Carryforward [Line Items] | |
Federal net operating loss carryforwards | 6,256 |
Year of Expiration 2027 [Member] | Federal Research and Development Tax Credit Carryforwards [Member] | |
Tax Credit Carryforward [Line Items] | |
Tax credit carryforwards | 840 |
Year of Expiration 2028 [Member] | |
Tax Credit Carryforward [Line Items] | |
Federal net operating loss carryforwards | 38,954 |
Year of Expiration 2028 [Member] | Federal Research and Development Tax Credit Carryforwards [Member] | |
Tax Credit Carryforward [Line Items] | |
Tax credit carryforwards | 2,108 |
Year of Expiration 2029 [Member] | |
Tax Credit Carryforward [Line Items] | |
Federal net operating loss carryforwards | 4,755 |
Year of Expiration 2029 [Member] | Federal Research and Development Tax Credit Carryforwards [Member] | |
Tax Credit Carryforward [Line Items] | |
Tax credit carryforwards | 1,149 |
Year of Expiration 2030 [Member] | |
Tax Credit Carryforward [Line Items] | |
Federal net operating loss carryforwards | 1,030 |
Year of Expiration 2030 [Member] | Federal Research and Development Tax Credit Carryforwards [Member] | |
Tax Credit Carryforward [Line Items] | |
Tax credit carryforwards | 1,162 |
Year of Expiration 2031 [Member] | |
Tax Credit Carryforward [Line Items] | |
Federal net operating loss carryforwards | 605 |
Year of Expiration 2031 [Member] | Federal Research and Development Tax Credit Carryforwards [Member] | |
Tax Credit Carryforward [Line Items] | |
Tax credit carryforwards | 3,097 |
Year of Expiration 2032 [Member] | |
Tax Credit Carryforward [Line Items] | |
Federal net operating loss carryforwards | 1,533 |
Year of Expiration 2032 [Member] | Federal Research and Development Tax Credit Carryforwards [Member] | |
Tax Credit Carryforward [Line Items] | |
Tax credit carryforwards | 3,666 |
Year of Expiration 2033 [Member] | |
Tax Credit Carryforward [Line Items] | |
Federal net operating loss carryforwards | 37,209 |
Year of Expiration 2033 [Member] | Federal Research and Development Tax Credit Carryforwards [Member] | |
Tax Credit Carryforward [Line Items] | |
Tax credit carryforwards | 3,178 |
Year of Expiration 2034 [Member] | |
Tax Credit Carryforward [Line Items] | |
Federal net operating loss carryforwards | 4,353 |
Year of Expiration 2034 [Member] | Federal Research and Development Tax Credit Carryforwards [Member] | |
Tax Credit Carryforward [Line Items] | |
Tax credit carryforwards | 1,861 |
Year of Expiration 2035 [Member] | |
Tax Credit Carryforward [Line Items] | |
Federal net operating loss carryforwards | 195,416 |
Year of Expiration 2035 [Member] | Federal Research and Development Tax Credit Carryforwards [Member] | |
Tax Credit Carryforward [Line Items] | |
Tax credit carryforwards | 752 |
Year of Expiration 2036 [Member] | |
Tax Credit Carryforward [Line Items] | |
Federal net operating loss carryforwards | 293,661 |
Year of Expiration 2036 [Member] | Federal Research and Development Tax Credit Carryforwards [Member] | |
Tax Credit Carryforward [Line Items] | |
Tax credit carryforwards | 1,739 |
Year Of Expiration 2037 [Member] | |
Tax Credit Carryforward [Line Items] | |
Federal net operating loss carryforwards | 423,531 |
Year Of Expiration 2037 [Member] | Federal Research and Development Tax Credit Carryforwards [Member] | |
Tax Credit Carryforward [Line Items] | |
Tax credit carryforwards | $ 3,515 |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Balance | $ 6,018 | $ 8,083 | $ 8,022 |
Additions related to current year tax positions | 708 | 193 | 61 |
Reductions for prior year tax positions | (2,843) | ||
Balance | $ 3,883 | $ 6,018 | $ 8,083 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Contingency [Line Items] | |||
Deferred income tax benefit | $ (89,895) | $ (23) | $ (53,292) |
Statutory federal income tax rate | 35.00% | 35.00% | 35.00% |
Increase in valuation allowance | $ 76,600 | $ 95,000 | |
Valuation allowance | 239,536 | 162,892 | |
Change in federal tax rate due to the Tax Cuts and Jobs Act | 126,502 | 0 | $ 0 |
Federal net operating loss carryforwards | 1,007,303 | ||
Decrease in unrecognized tax liability | 2,843 | ||
Unrecognized tax benefits, if recognized, would impact effective tax rate | 0 | $ 1,900 | $ 1,900 |
Foreign [Member] | |||
Income Tax Contingency [Line Items] | |||
Federal net operating loss carryforwards | 49,500 | ||
Alternative Minimum Tax Credits [Member] | |||
Income Tax Contingency [Line Items] | |||
Tax credit carryforwards | 4,900 | ||
Ministry of Economic Affairs and Finance, Italy [Member] | |||
Income Tax Contingency [Line Items] | |||
Income tax assessment liability | 500 | ||
Decrease in unrecognized tax liability | $ 1,400 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured on a Recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Liabilities: | ||
Contingent purchase price | $ 14,655 | $ 31,832 |
Fair Value, Measurements, Recurring [Member] | ||
Assets: | ||
Cash and cash equivalents | 12,100 | 56,097 |
Total assets at fair value | 12,100 | 56,097 |
Liabilities: | ||
Contingent purchase price | 19,650 | 31,832 |
Total liabilities at fair value | 19,650 | 31,832 |
Fair Value, Measurements, Recurring [Member] | Level 1 [Member] | ||
Assets: | ||
Cash and cash equivalents | 12,100 | 56,097 |
Total assets at fair value | 12,100 | 56,097 |
Liabilities: | ||
Contingent purchase price | 0 | 0 |
Total liabilities at fair value | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Level 2 [Member] | ||
Assets: | ||
Cash and cash equivalents | 0 | |
Total assets at fair value | 0 | 0 |
Liabilities: | ||
Contingent purchase price | 0 | 0 |
Total liabilities at fair value | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Level 3 [Member] | ||
Assets: | ||
Cash and cash equivalents | 0 | 0 |
Total assets at fair value | 0 | 0 |
Liabilities: | ||
Contingent purchase price | 19,650 | 31,832 |
Total liabilities at fair value | $ 19,650 | $ 31,832 |
Fair Value Measurements - Level
Fair Value Measurements - Level 3 Inputs (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Contingent purchase price | $ 14,655 | $ 31,832 |
Targanta [Member] | Adjusted discounted cash flow [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Probability of success | 5.00% | 20.00% |
Discount rate | 11.00% | 11.00% |
Incline [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Contingent purchase price | $ 1,269 | |
Incline [Member] | Adjusted discounted cash flow [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Probability of success | 5.00% | 5.00% |
Discount rate | 18.00% | 18.00% |
Incline [Member] | Minimum [Member] | Adjusted discounted cash flow [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Probability of success | 5.00% | |
Incline [Member] | Maximum [Member] | Adjusted discounted cash flow [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Probability of success | 5.00% | |
Rempex [Member] | Event-based milestones [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Contingent purchase price | $ 19,650 | $ 16,500 |
Rempex [Member] | Event-based milestones [Member] | Adjusted discounted cash flow [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Probability of success | 71.00% | 78.00% |
Rempex [Member] | Event-based milestones [Member] | Minimum [Member] | Adjusted discounted cash flow [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Probability of success | 18.00% | 18.00% |
Discount rate | 4.80% | 5.20% |
Rempex [Member] | Event-based milestones [Member] | Maximum [Member] | Adjusted discounted cash flow [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Probability of success | 90.00% | 95.00% |
Discount rate | 7.50% | 8.50% |
Rempex [Member] | Sales-based milestones [Member] | Adjusted revenue simulation [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Probability of success | 72.00% | 56.00% |
Rempex [Member] | Sales-based milestones [Member] | Minimum [Member] | Adjusted revenue simulation [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Probability of success | 15.00% | 16.00% |
Discount rate | 5.50% | 6.60% |
Rempex [Member] | Sales-based milestones [Member] | Maximum [Member] | Adjusted revenue simulation [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Probability of success | 85.00% | 65.00% |
Discount rate | 6.70% | 8.20% |
Annovation [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Contingent purchase price | $ 14,063 | |
Annovation [Member] | Adjusted discounted cash flow [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Probability of success | 33.00% | 34.00% |
Annovation [Member] | Minimum [Member] | Adjusted discounted cash flow [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Probability of success | 9.00% | 9.00% |
Discount rate | 5.30% | 6.00% |
Annovation [Member] | Maximum [Member] | Adjusted discounted cash flow [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Probability of success | 50.00% | 50.00% |
Discount rate | 9.50% | 10.00% |
Fair Value Measurements - Lev84
Fair Value Measurements - Level 3 Contingent Purchase Price (Details) - Fair Value, Measurements, Recurring [Member] - Level 3 [Member] - Contingent Purchase Price Liability [Member] - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2015 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance at beginning of period | $ 31,832 | |
Payments | 0 | $ (10,449) |
Fair value adjustments to contingent purchase prices included in net loss | (12,182) | 23,981 |
Balance at end of period | $ 19,650 | $ 18,300 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) $ in Thousands | Jun. 21, 2016 | Feb. 01, 2016 | Dec. 31, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Contingent purchase price from sale of businesses | $ 80,700 | $ 143,700 | ||
Discontinued operations, disposed of by sale [Member] | Hemostasis Business [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Contingent purchase price from sale of businesses | $ 235,000 | 78,000 | ||
Discount rate | 10.00% | |||
Discontinued operations, disposed of by sale [Member] | Minimum [Member] | Hemostasis Business [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Probabilities of achievement | 15.00% | |||
Discontinued operations, disposed of by sale [Member] | Maximum [Member] | Hemostasis Business [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Probabilities of achievement | 85.00% | |||
Not discontinued operations, disposed of by sale [Member] | Non-Core ACC Products [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Contingent purchase price from sale of businesses | $ 480,000 | 65,700 | ||
Not discontinued operations, disposed of by sale [Member] | Minimum [Member] | Non-Core ACC Products [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Discount rate | 3.10% | |||
Adjusted revenue volatilities | 30.00% | |||
Not discontinued operations, disposed of by sale [Member] | Maximum [Member] | Non-Core ACC Products [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Discount rate | 6.90% | |||
Adjusted revenue volatilities | 41.00% | |||
Disposal Group, Disposed of by Means Other than Sale, Not Discontinued Operations, Abandonment [Member] | Ionsys and MDCO-700 [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Contingent purchase price | 175,800 | |||
Rempex [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Contingent consideration | $ 224,300 |
Restructuring (Details)
Restructuring (Details) $ in Thousands | Jun. 19, 2017USD ($)position | Jun. 21, 2016USD ($)Employee | Jun. 30, 2017USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) |
Restructuring Cost and Reserve [Line Items] | ||||||
Asset impairment charges | $ 392,097 | $ 0 | $ 0 | |||
Severance costs | $ 5,800 | |||||
Other restructuring costs | $ 3,000 | |||||
Employee serverance and other personnel benefits: | ||||||
Balance | 1,854 | 0 | ||||
Expenses, Net | 5,897 | 17,162 | ||||
Cash | (6,806) | (14,697) | ||||
Noncash | (945) | (611) | ||||
Balance | 0 | 1,854 | 0 | |||
Reorganization Plan 2017 [Member] | Workforce reduction [Member] | ||||||
Employee serverance and other personnel benefits: | ||||||
Balance | 0 | |||||
Expenses, Net | 5,897 | |||||
Cash | (5,768) | |||||
Noncash | (129) | |||||
Balance | 0 | 0 | ||||
2016 Reorganization Plan [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Number of positions eliminated due to restructuring | Employee | 162 | |||||
Stock option term | 1 year | |||||
Expected restructuring costs | $ 17,200 | |||||
2016 Reorganization Plan [Member] | Workforce reduction [Member] | ||||||
Employee serverance and other personnel benefits: | ||||||
Balance | 1,854 | 0 | ||||
Expenses, Net | 0 | 17,162 | ||||
Cash | (1,038) | (14,697) | ||||
Noncash | (816) | (611) | ||||
Balance | $ 0 | $ 1,854 | $ 0 | |||
Ionsys [Member] | Disposal Group, Disposed of by Means Other than Sale, Not Discontinued Operations, Abandonment [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Number of positions eliminated due to restructuring | position | 57 | |||||
Pre-tax restructuring charge | $ 276,900 | |||||
Percentage of positions eliminated | 15.00% | |||||
Asset impairment charges | 268,100 | |||||
Severance costs | $ 8,800 |
Commitments and Contingencies87
Commitments and Contingencies (Details) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017USD ($)ft² | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Oct. 01, 2014ft² | |
Future Estimated Contract Obligations | ||||
Less Than 1 Year | $ 134,335 | |||
1-3 Years | 100,962 | |||
3-5 Years | 49,936 | |||
More Than 5 Years | 58,337 | |||
Total | $ 343,570 | |||
Leased area (sqft) | ft² | 173,146 | |||
Operating leases, percent | 99.70% | |||
Aggregate rent expense under property leases | $ 9,600 | $ 7,600 | $ 7,300 | |
Targanta [Member] | ||||
Future Estimated Contract Obligations | ||||
Payment for milestone met | 49,400 | |||
Additional payments | 25,000 | |||
Alnylam [Member] | ||||
Future Estimated Contract Obligations | ||||
Payment for milestone met | 170,000 | |||
Other [Member] | ||||
Future Estimated Contract Obligations | ||||
Payment for milestone met | 2,200 | |||
Biogen Idec and HRI [Member] | ||||
Future Estimated Contract Obligations | ||||
Royalties | 800 | 800 | 1,800 | |
Cleviprex [Member] | ||||
Future Estimated Contract Obligations | ||||
Royalties | $ 0 | $ 600 | $ 1,300 | |
Building [Member] | ||||
Future Estimated Contract Obligations | ||||
Leased area (sqft) | ft² | 63,000 | |||
Lease term | 144 months | |||
Expected total obligation for lease | $ 36,600 | |||
Inventory related commitments [Member] | ||||
Future Estimated Contract Obligations | ||||
Less Than 1 Year | 52,111 | |||
1-3 Years | 16,167 | |||
3-5 Years | 0 | |||
More Than 5 Years | 0 | |||
Total | 68,278 | |||
Inventory related commitments [Member] | Angiomax [Member] | ||||
Future Estimated Contract Obligations | ||||
Less Than 1 Year | 66,900 | |||
Inventory related commitments [Member] | Minocin [Member] | ||||
Future Estimated Contract Obligations | ||||
Less Than 1 Year | 1,200 | |||
Inventory related commitments [Member] | Orbactiv [Member] | ||||
Future Estimated Contract Obligations | ||||
Less Than 1 Year | 200 | |||
Research and development [Member] | ||||
Future Estimated Contract Obligations | ||||
Less Than 1 Year | 71,115 | |||
1-3 Years | 68,387 | |||
3-5 Years | 34,508 | |||
More Than 5 Years | 30,409 | |||
Total | 204,419 | |||
Operating leases [Member] | ||||
Future Estimated Contract Obligations | ||||
Less Than 1 Year | 7,185 | |||
1-3 Years | 15,029 | |||
3-5 Years | 15,428 | |||
More Than 5 Years | 27,928 | |||
Total | 65,570 | |||
Selling, general and administrative [Member] | ||||
Future Estimated Contract Obligations | ||||
Less Than 1 Year | 3,924 | |||
1-3 Years | 1,379 | |||
3-5 Years | 0 | |||
More Than 5 Years | 0 | |||
Total | 5,303 | |||
Research and development, and selling, general and administrative [Member] | ||||
Future Estimated Contract Obligations | ||||
Total | 5,300 | |||
Infectious Disease Business [Member] | Inventory related commitments [Member] | ||||
Future Estimated Contract Obligations | ||||
Total | 68,300 | |||
Infectious Disease Business [Member] | Research and development [Member] | ||||
Future Estimated Contract Obligations | ||||
Total | 7,300 | |||
Infectious Disease Business [Member] | Selling, general and administrative [Member] | ||||
Future Estimated Contract Obligations | ||||
Total | 1,800 | |||
Infectious Disease Business [Member] | Not discontinued operations, disposed of by sale [Member] | ||||
Future Estimated Contract Obligations | ||||
Contingent purchase price | 229,400 | |||
Ionsys and MDCO-700 [Member] | Disposal Group, Disposed of by Means Other than Sale, Not Discontinued Operations, Abandonment [Member] | ||||
Future Estimated Contract Obligations | ||||
Contingent purchase price | $ 175,800 |
Employee Benefit Plan (Details)
Employee Benefit Plan (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Retirement Benefits [Abstract] | |||
Contributions by employer | $ 1.5 | $ 1.7 | $ 2.5 |
Segment and Geographic Inform89
Segment and Geographic Information (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Sep. 30, 2016USD ($) | Jun. 30, 2016USD ($) | Mar. 31, 2016USD ($) | Dec. 31, 2017USD ($)segment | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Number of operating segments | segment | 1 | ||||||||||
Total net revenues | $ 8,595 | $ 7,868 | $ 10,861 | $ 17,465 | $ 17,429 | $ 31,084 | $ 48,573 | $ 46,075 | $ 44,789 | $ 143,161 | $ 294,547 |
Long-lived assets | 309,679 | 703,164 | 309,679 | 703,164 | |||||||
United States [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Total net revenues | $ 37,131 | $ 131,572 | $ 275,118 | ||||||||
Percentage of revenue by geographic segments | 82.90% | 91.90% | 93.40% | ||||||||
Long-lived assets | $ 308,843 | $ 699,004 | $ 308,843 | $ 699,004 | |||||||
Percentage of long-lived assets by geographic segments | 99.70% | 99.40% | 99.70% | 99.40% | |||||||
Europe [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Total net revenues | $ 7,239 | $ 9,331 | $ 16,745 | ||||||||
Percentage of revenue by geographic segments | 16.20% | 6.50% | 5.70% | ||||||||
Long-lived assets | $ 836 | $ 4,160 | $ 836 | $ 4,160 | |||||||
Percentage of long-lived assets by geographic segments | 0.30% | 0.60% | 0.30% | 0.60% | |||||||
Other [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Total net revenues | $ 419 | $ 2,258 | $ 2,684 | ||||||||
Percentage of revenue by geographic segments | 0.90% | 1.60% | 0.90% |
Collaboration Agreements (Detai
Collaboration Agreements (Details) - USD ($) $ in Thousands | Oct. 02, 2015 | Dec. 16, 2014 | Nov. 30, 2017 | Dec. 31, 2014 | Feb. 28, 2013 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||||
Co-promotion and license income | $ 7,549 | $ 3,854 | $ 10,132 | |||||
Alnylam [Member] | Collaborative Arrangement [Member] | ||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||||
Initial payment | $ 25,000 | |||||||
Milestone payment | $ 20,000 | $ 10,000 | 10,000 | |||||
Maximum payment | $ 180,000 | |||||||
SciClone [Member] | Collaborative Arrangement [Member] | ||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||||
Initial payment | $ 10,000 | |||||||
Milestone payment | $ 50,500 | |||||||
Co-promotion and license income | 600 | 600 | ||||||
SymBio Pharmaceuticals Ltd [Member] | Collaborative Arrangement [Member] | ||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||||
Initial payment | $ 10,000 | |||||||
Milestone payment | $ 20,900 | |||||||
Co-promotion and license income | $ 6,900 | $ 2,500 |
Accumulated Other Comprehensi91
Accumulated Other Comprehensive (Loss) Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | |||
Balance | $ 651,983 | $ 731,774 | $ 920,091 |
Other comprehensive income before reclassifications | 296 | 213 | 1,445 |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | (9,665) | ||
Other comprehensive income (loss) | 296 | (9,452) | 1,445 |
Balance | 24,914 | 651,983 | 731,774 |
Total [Member] | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | |||
Balance | (5,479) | 3,973 | 2,528 |
Balance | (5,183) | (5,479) | 3,973 |
Foreign currency translation adjustment [Member] | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | |||
Balance | (5,479) | 3,924 | 2,479 |
Other comprehensive income before reclassifications | 296 | 213 | 1,445 |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | (9,616) | ||
Other comprehensive income (loss) | 296 | (9,403) | 1,445 |
Balance | (5,183) | (5,479) | 3,924 |
Unrealized (gain) loss on available for sale securities [Member] | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | |||
Balance | 0 | 49 | 49 |
Other comprehensive income before reclassifications | 0 | 0 | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | (49) | ||
Other comprehensive income (loss) | 0 | (49) | 0 |
Balance | $ 0 | $ 0 | $ 49 |
Selected Quarterly Financial 92
Selected Quarterly Financial Data (Unaudited) (Details) $ / shares in Units, $ in Thousands | Jun. 19, 2017position | Jun. 21, 2016USD ($) | Feb. 02, 2015USD ($) | Dec. 31, 2017USD ($)$ / shares | Sep. 30, 2017USD ($)$ / shares | Jun. 30, 2017USD ($)$ / shares | Mar. 31, 2017USD ($)$ / shares | Dec. 31, 2016USD ($)$ / shares | Sep. 30, 2016USD ($)$ / shares | Jun. 30, 2016USD ($)$ / shares | Mar. 31, 2016USD ($)$ / shares | Dec. 31, 2017USD ($)$ / shares | Dec. 31, 2016USD ($)$ / shares | Dec. 31, 2015USD ($)$ / shares |
Quarterly Financial Information Disclosure [Abstract] | ||||||||||||||
Total net revenues | $ 8,595 | $ 7,868 | $ 10,861 | $ 17,465 | $ 17,429 | $ 31,084 | $ 48,573 | $ 46,075 | $ 44,789 | $ 143,161 | $ 294,547 | |||
Cost of product revenues | 20,438 | 4,287 | 12,490 | 9,978 | 14,337 | 18,213 | 12,061 | 16,042 | 47,193 | 60,653 | 103,986 | |||
Total operating expenses | 168,682 | 71,129 | 393,195 | 76,879 | 88,296 | 51,881 | 120,817 | 104,248 | 709,885 | 365,242 | 479,674 | |||
Loss from operations | (160,087) | (63,261) | (382,334) | (59,414) | (70,867) | (20,797) | (72,244) | (58,173) | (607,695) | 20,510 | (134,796) | |||
(Loss) income from continuing operations attributable to The Medicines Company | (159,416) | (7,218) | (370,065) | (70,996) | (82,779) | (31,444) | 201,912 | (67,125) | (607,695) | 20,564 | (134,806) | |||
(Loss) income from discontinued operations, net of tax attributable to The Medicines Company | (18,844) | (22,957) | (27,203) | (31,674) | (40,073) | (54,815) | (19,470) | (25,324) | (100,678) | (139,682) | (217,950) | |||
Net loss attributable to The Medicines Company | $ (178,260) | $ (30,175) | $ (397,268) | $ (102,670) | $ (122,852) | $ (86,259) | $ 182,442 | $ (92,449) | $ (708,373) | $ (119,118) | $ (352,756) | |||
(Loss) income from continuing operations (usd per share) | $ / shares | $ (2.19) | $ (0.10) | $ (5.15) | $ (1) | $ (1.17) | $ (0.45) | $ 2.78 | $ (0.97) | $ (8.40) | $ 0.28 | $ (2.02) | |||
Loss from discontinued operations (usd per share) | $ / shares | (0.26) | (0.31) | (0.38) | (0.45) | (0.57) | (0.78) | (0.27) | (0.37) | (1.39) | (1.91) | (3.26) | |||
Diluted loss per share (usd per share) | $ / shares | $ (2.45) | $ (0.41) | $ (5.53) | $ (1.45) | $ (1.74) | $ (1.23) | $ 2.51 | $ (1.34) | $ (9.79) | $ (1.63) | $ (5.28) | |||
Business Acquisition [Line Items] | ||||||||||||||
Increase (decrease) in contingent purchase price | $ (18,787) | $ 23,981 | $ 20,278 | |||||||||||
Gain on sale of investment | 0 | 0 | 19,773 | |||||||||||
Inventory write-down, obsolescence | 16,700 | 8,500 | ||||||||||||
Impairment charges | $ 392,097 | 0 | 0 | |||||||||||
Annovation [Member] | ||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||
Contingent consideration | $ 26,300 | |||||||||||||
Percentage ownership in acquiree prior to acquisition | 35.80% | |||||||||||||
Fair value of existing equity interest | $ 25,886 | |||||||||||||
Gain on remeasurement of equity investment | $ 22,700 | |||||||||||||
Disposal Group, Disposed of by Means Other than Sale, Not Discontinued Operations, Abandonment [Member] | Ionsys [Member] | ||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||
Number of positions eliminated due to restructuring | position | 57 | |||||||||||||
Percentage of positions eliminated | 15.00% | |||||||||||||
Settlement and impairment provisions | $ 276,900 | |||||||||||||
Inventory write-down, obsolescence | 5,300 | |||||||||||||
Impairment charges | 268,100 | |||||||||||||
Disposal Group, Disposed of by Means Other than Sale, Not Discontinued Operations, Abandonment [Member] | Development of MDCO-700 [Member] | ||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||
Increase (decrease) in contingent purchase price | (14,700) | |||||||||||||
Contingent consideration | 0 | |||||||||||||
Benefit for income taxes | 23,000 | |||||||||||||
Not discontinued operations, disposed of by sale [Member] | Non-Core ACC Products [Member] | ||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||
Gain on sale of assets | $ 288,301 | |||||||||||||
Discontinued operations, disposed of by sale [Member] | Hemostasis Business [Member] | ||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||
Gain on sale of assets | 1,004 | 0 | ||||||||||||
Impairment charges | $ 0 | 133,266 | ||||||||||||
Goodwill impairment charge | $ 24,500 | |||||||||||||
In-process research and development [Member] | Disposal Group, Disposed of by Means Other than Sale, Not Discontinued Operations, Abandonment [Member] | Development of MDCO-700 [Member] | ||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||
Asset impairment charges | $ 65,000 |
Dispositions - Major Classes of
Dispositions - Major Classes of Assets Sold and Gain Recognized (Details) - USD ($) $ in Thousands | Jun. 21, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Sale price: | ||||
Cash | $ 0 | $ 437,875 | $ 0 | |
Non-Core ACC Products [Member] | Not discontinued operations, disposed of by sale [Member] | ||||
Sale price: | ||||
Cash | $ 263,807 | |||
Contingent purchase price from sale of business | 65,700 | |||
Total sale price | 329,507 | |||
Assets: | ||||
Inventory | 2,184 | |||
Intangibles | 5,210 | |||
Goodwill | 33,812 | |||
Total assets sold/held for sale | 41,206 | |||
Gain on sale of business | $ 288,301 |
Dispositions - Narrative (Detai
Dispositions - Narrative (Details) - USD ($) $ in Thousands | Jun. 21, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Proceeds from sale of businesses | $ 0 | $ 437,875 | $ 0 | |
Potential contingent proceeds from sale | 80,700 | 143,700 | ||
Gain on sale | 0 | 288,301 | $ 0 | |
Non-Core ACC Products [Member] | Not discontinued operations, disposed of by sale [Member] | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Proceeds from sale of businesses | $ 263,807 | |||
Potential contingent proceeds from sale | $ 480,000 | $ 65,700 | ||
Gain on sale | 288,300 | |||
Disposition related costs | $ 7,900 |
Discontinued Operations - Infec
Discontinued Operations - Infectious Disease Business (Details) $ in Thousands | Jan. 05, 2018USD ($)position | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) |
Operating expenses: | ||||
Loss from discontinued operations, net of tax | $ (100,678) | $ (139,682) | $ (217,950) | |
Assets: | ||||
Current assets held for sale | 391,202 | 50,586 | ||
Liabilities: | ||||
Current liabilities held for sale | 60,580 | 87,025 | ||
Discontinued Operation, Additional Disclosures [Abstract] | ||||
Amortization from discontinued operations | 10,638 | 17,858 | 6,798 | |
Changes in contingent purchase price | (3,456) | 53,249 | 1 | |
Reserve for excess or obsolete inventory | (435) | (2,066) | 4,228 | |
Payments on contingent purchase price | (63,066) | (10,449) | (18) | |
Infectious Disease Business [Member] | Not discontinued operations, disposed of by sale [Member] | ||||
Disposal Group, Including Discontinued Operation, Income Statement Disclosures [Abstract] | ||||
Net product revenues | 34,622 | 24,673 | 14,460 | |
Operating expenses: | ||||
Cost of product revenue | 20,060 | 10,693 | 15,945 | |
Research and development | 39,984 | 47,155 | 33,218 | |
Selling, general and administrative | 74,346 | 106,670 | 52,643 | |
Total operating expenses | 134,390 | 164,518 | 101,806 | |
Loss from operations | (99,768) | (139,845) | (87,346) | |
Other expense, net | (906) | (19) | 212 | |
Income (loss) from discontinued operations before income taxes | (100,674) | (139,864) | (87,134) | |
Benefit for income taxes | 4 | 2 | (10) | |
Loss from discontinued operations, net of tax | (100,678) | (139,866) | $ (87,124) | |
Assets: | ||||
Accounts receivable, net | 9,595 | 3,916 | ||
Inventory | 41,412 | 42,411 | ||
Other receivables | 2,740 | 4,259 | ||
Intangibles, net | 282,398 | 0 | ||
Goodwill | 55,057 | 0 | ||
Current assets held for sale | 391,202 | 50,586 | ||
Intangibles, net | 0 | 293,036 | ||
Goodwill | 0 | 55,057 | ||
Total assets sold/held for sale | 391,202 | 398,679 | ||
Liabilities: | ||||
Accounts payable | 1,127 | 7,872 | ||
Accrued expenses | 22,945 | 21,686 | ||
Contingent purchase price – current | 24,650 | 55,000 | ||
Deferred Revenue | 723 | 2,467 | ||
Disposal Group, Including Discontinued Operation, Contingent Purchase Price, Noncurrent, Reclassified as Current Held-for-Sale | 11,135 | 0 | ||
Contingent purchase price – noncurrent | 0 | 50,457 | ||
Current liabilities held for sale | 60,580 | 87,025 | ||
Total liabilities held for sale | $ 60,580 | $ 137,482 | ||
Subsequent Event [Member] | Infectious Disease Business [Member] | Not discontinued operations, disposed of by sale [Member] | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Number of positions eliminated due to restructuring | position | 36 | |||
Cash payment 12 months after transaction close | $ 25,000 | |||
Total sale price | 166,400 | |||
Discontinued Operation, Additional Disclosures [Abstract] | ||||
Cash payment 18 months after transaction close | 25,000 | |||
Fair value of consideration | $ 500,000 |
Discontinued Operations - Recot
Discontinued Operations - Recothrom (Details) - Bristol-Myers Squibb [Member] $ in Millions | 1 Months Ended |
Feb. 28, 2015USD ($) | |
Business Acquisition [Line Items] | |
Payment to acquire businesses | $ 132.4 |
Inventory | $ 44 |
Discontinued Operations - Sale
Discontinued Operations - Sale of Hemostasis Business (Details) - USD ($) $ in Thousands | Feb. 01, 2016 | Sep. 30, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Proceeds from sale of businesses | $ 0 | $ 437,875 | $ 0 | ||
Contingent purchase price from sale of businesses | 80,700 | 143,700 | |||
Operating expenses: | |||||
Impairment | 392,097 | 0 | 0 | ||
Loss from discontinued operations, net of tax | (100,678) | (139,682) | (217,950) | ||
Amounts reclassified from accumulated other comprehensive income | 9,665 | ||||
Discontinued Operation, Additional Disclosures [Abstract] | |||||
Amortization from discontinued operations | 10,638 | 17,858 | 6,798 | ||
Asset impairment charges | 392,097 | 0 | 29,413 | ||
Reserve for excess or obsolete inventory | (435) | (2,066) | 4,228 | ||
Changes in contingent purchase price | (3,456) | 53,249 | 1 | ||
Proceeds from sale of businesses | 0 | 437,875 | 0 | ||
Hemostasis Business [Member] | Discontinued operations, disposed of by sale [Member] | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Proceeds from sale of businesses | $ 174,100 | 174,068 | 0 | ||
Contingent purchase price from sale of businesses | 235,000 | $ 78,000 | |||
Goodwill impairment charge | 24,500 | ||||
Disposal Group, Including Discontinued Operation, Income Statement Disclosures [Abstract] | |||||
Net product revenues | 1,275 | 65,754 | |||
Operating expenses: | |||||
Cost of product revenue | 1,424 | 75,889 | |||
Research and development | 90 | 7,568 | |||
Selling, general and administrative | 542 | 560 | |||
Impairment | 0 | 133,266 | |||
Total operating expenses | 2,056 | 217,283 | |||
Income (loss) from operations | (781) | (151,529) | |||
Gain from sale of business | 1,004 | 0 | |||
Other expense, net | (39) | (745) | |||
Income (loss) from discontinued operations before income taxes | 184 | (152,274) | |||
Benefit for income taxes | 0 | (21,448) | |||
Loss from discontinued operations, net of tax | 184 | (130,826) | |||
Discontinued Operation, Additional Disclosures [Abstract] | |||||
Depreciation from discontinued operations | 0 | 371 | |||
Amortization from discontinued operations | 0 | 42,278 | |||
Gain on sale of business | (1,004) | 0 | |||
Asset impairment charges | 0 | 25,800 | |||
Reserve for excess or obsolete inventory | 0 | 876 | |||
Changes in contingent purchase price | 0 | 8,743 | |||
Proceeds from sale of businesses | 174,100 | 174,068 | 0 | ||
Capital expenditures | 0 | 738 | |||
Foreign currency translation adjustment [Member] | |||||
Operating expenses: | |||||
Amounts reclassified from accumulated other comprehensive income | $ 9,616 | ||||
Foreign currency translation adjustment [Member] | Hemostasis Business [Member] | Discontinued operations, disposed of by sale [Member] | |||||
Operating expenses: | |||||
Amounts reclassified from accumulated other comprehensive income | $ 9,600 | ||||
Asset impairment charges [Member] | Foreign currency translation adjustment [Member] | |||||
Operating expenses: | |||||
Amounts reclassified from accumulated other comprehensive income | 8,400 | ||||
Gain from sale of business [Member] | Foreign currency translation adjustment [Member] | |||||
Operating expenses: | |||||
Amounts reclassified from accumulated other comprehensive income | $ 1,200 | ||||
Cost of product revenue [Member] | |||||
Operating expenses: | |||||
Impairment charge | $ 25,800 |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Event [Member] $ in Millions | Feb. 27, 2018USD ($) |
Minimum [Member] | |
Subsequent Event [Line Items] | |
Expected restructuring costs | $ 20 |
Maximum [Member] | |
Subsequent Event [Line Items] | |
Expected restructuring costs | $ 26 |