Document and Entity Information
Document and Entity Information - USD ($) | 3 Months Ended | ||
Dec. 31, 2018 | Feb. 20, 2019 | Jun. 29, 2018 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-KT | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2018 | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | GWPH | ||
Entity Registrant Name | GW PHARMACEUTICALS PLC | ||
Entity Central Index Key | 1,351,288 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 366,953,024 | ||
Entity Public Float | $ 3,793,000,000 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 |
Assets | |||
Cash and cash equivalents | $ 591,497 | $ 354,913 | $ 322,154 |
Accounts receivable, net | 4,192 | 2,122 | 1,367 |
Inventory | 33,030 | 19,061 | 5,669 |
Prepaid expenses and other current assets | 17,903 | 14,615 | 35,392 |
Total current assets | 646,622 | 390,711 | 364,582 |
Property, plant, and equipment, net | 90,832 | 82,381 | 63,175 |
Goodwill | 6,959 | 6,959 | 6,959 |
Deferred tax assets | 8,720 | 7,334 | 6,805 |
Other assets | 2,935 | 3,150 | 1,401 |
Total assets | 756,068 | 490,535 | 442,922 |
Liabilities and stockholders’ equity | |||
Accounts payable | 9,796 | 9,741 | 7,757 |
Accrued liabilities | 52,477 | 46,739 | 33,656 |
Current tax liabilities | 2,384 | 1,385 | 1,119 |
Other current liabilities | 1,559 | 804 | 2,377 |
Total current liabilities | 66,216 | 58,669 | 44,909 |
Long-term liabilities: | |||
Capital lease obligations | 1,454 | 1,535 | 1,741 |
Build-to-suit financing obligation | 4,236 | 4,378 | 4,611 |
Other liabilities | 10,082 | 10,794 | 10,838 |
Total long-term liabilities | 15,772 | 16,707 | 17,190 |
Total liabilities | 81,988 | 75,376 | 62,099 |
Commitments and contingencies (Note 10) | |||
Stockholders’ equity: | |||
Ordinary shares par value £0.001; 366,616,688 shares outstanding as of December 31, 2018; 340,246,840 and 304,439,740 shares outstanding as of September 30, 2018 and 2017, respectively | 564 | 530 | 482 |
Additional paid-in capital | 1,581,144 | 1,246,857 | 916,726 |
Accumulated deficit | (828,940) | (757,034) | (461,867) |
Accumulated other comprehensive loss | (78,688) | (75,194) | (74,518) |
Total stockholders’ equity | 674,080 | 415,159 | 380,823 |
Total liabilities and stockholders’ equity | $ 756,068 | $ 490,535 | $ 442,922 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - £ / shares | Dec. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 |
Statement Of Financial Position [Abstract] | |||
Ordinary shares, par value | £ 0.001 | £ 0.001 | £ 0.001 |
Ordinary shares, outstanding | 366,616,688 | 340,246,840 | 304,439,740 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Revenues | ||||||||||||
Total revenues | $ 6,654 | $ 3,992 | $ 12,737 | $ 8,629 | $ 12,730 | |||||||
Operating expenses | ||||||||||||
Cost of product sales | 1,829 | 1,171 | 5,986 | 4,521 | 3,820 | |||||||
Research and development | 29,086 | 36,195 | 153,736 | 112,249 | 104,375 | |||||||
Selling, general and administrative | 49,083 | 25,174 | 141,818 | 58,020 | 33,188 | |||||||
Total operating expenses | 79,998 | 62,540 | 301,540 | 174,790 | 141,383 | |||||||
Loss from operations | (73,344) | $ (80,607) | $ (81,406) | $ (68,242) | (58,548) | $ (48,414) | $ (43,023) | $ (38,923) | $ (35,801) | (288,803) | (166,161) | (128,653) |
Interest income | 2,449 | 604 | 3,645 | 2,063 | 611 | |||||||
Interest expense | (295) | (314) | (1,249) | (951) | (244) | |||||||
Foreign exchange (loss) gain | (982) | 160 | (4,963) | (6,442) | 35,897 | |||||||
Loss before income taxes | (72,172) | (58,098) | (291,370) | (171,491) | (92,389) | |||||||
Income tax (benefit) expense | (266) | 3,718 | 3,797 | (1,032) | (693) | |||||||
Net loss | $ (71,906) | $ (79,879) | $ (84,011) | $ (69,461) | $ (61,816) | $ (53,853) | $ (52,648) | $ (43,266) | $ (20,692) | $ (295,167) | $ (170,459) | $ (91,696) |
Net loss per common share, basic and diluted | $ (0.20) | $ (0.23) | $ (0.25) | $ (0.20) | $ (0.20) | $ (0.18) | $ (0.17) | $ (0.14) | $ (0.07) | $ (0.88) | $ (0.56) | $ (0.34) |
Weighted average common shares outstanding, basic and diluted | 366,458 | 341,302 | 340,457 | 340,252 | 313,730 | 306,263 | 306,011 | 305,818 | 305,216 | 333,936 | 305,826 | 272,165 |
Product Net Sales | ||||||||||||
Revenues | ||||||||||||
Total revenues | $ 6,617 | $ 2,220 | $ 10,469 | $ 7,957 | $ 7,317 | |||||||
Other Revenue | ||||||||||||
Revenues | ||||||||||||
Total revenues | $ 37 | $ 1,772 | $ 2,268 | $ 672 | $ 5,413 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Statement Of Income And Comprehensive Income [Abstract] | ||||
Net loss | $ (71,906) | $ (295,167) | $ (170,459) | $ (91,696) |
Other comprehensive (loss) gain: | ||||
Foreign currency translation adjustments | (3,494) | (676) | 10,008 | (56,955) |
Comprehensive loss | $ (75,400) | $ (295,843) | $ (160,451) | $ (148,651) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Cash flows from operating activities | ||||
Net loss | $ (71,906) | $ (295,167) | $ (170,459) | $ (91,696) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||||
Foreign exchange loss (gain) | 742 | 4,917 | 9,280 | (35,750) |
Stock-based compensation | 9,683 | 31,627 | 15,479 | 12,661 |
Depreciation and amortization | 2,534 | 9,290 | 7,054 | 5,152 |
Deferred income taxes | (1,265) | (317) | (3,770) | (2,343) |
Other | 241 | 1,554 | 1 | |
Changes in operating assets and liabilities: | ||||
Accounts receivable, net | (2,125) | (804) | (277) | (735) |
Inventory | (14,460) | (13,646) | 5 | 656 |
Prepaid expenses and other current assets | (3,635) | 14,489 | (12,471) | (11,415) |
Other assets | (47) | (564) | ||
Accounts payable | (1,211) | 2,238 | 3,171 | (403) |
Current tax liabilities | 878 | 54 | 57 | 432 |
Accrued liabilities | 5,942 | 16,507 | 1,253 | 3,397 |
Other current liabilities | 93 | (1,546) | (11) | (80) |
Long-term liabilities | 317 | 813 | 161 | 195 |
Net cash used in operating activities | (74,460) | (231,868) | (148,974) | (119,928) |
Cash flows from investing activities | ||||
Additions to property, plant and equipment | (18,687) | (31,362) | (19,285) | (12,192) |
Additions to capitalized software | (63) | (2,042) | (812) | (719) |
Proceeds from disposal of property, plant and equipment | 517 | |||
Net cash used in investing activities | (18,750) | (32,887) | (20,097) | (12,911) |
Cash flows from financing activities | ||||
Proceeds from issuance of ordinary shares, net of issuance costs | 324,638 | 297,931 | 273,804 | |
Proceeds from exercise of stock options | 621 | 122 | 972 | |
Payments on build-to-suit financing obligation | (113) | (105) | (21) | |
Payments on capital leases | (40) | (163) | (156) | (157) |
Payments on landlord financing obligation | (130) | (522) | (1,074) | (337) |
Net cash provided by (used in) financing activities | 324,468 | 297,754 | (1,213) | 274,261 |
Effect of exchange rate changes on cash | 5,326 | (240) | 8,993 | (13,268) |
Net increase (decrease) in cash and cash equivalents | 236,584 | 32,759 | (161,291) | 128,154 |
Cash and cash equivalents at beginning of period | 354,913 | 322,154 | 483,445 | 355,291 |
Cash and cash equivalents at end of period | 591,497 | 354,913 | 322,154 | 483,445 |
Supplemental disclosure of cash flow information: | ||||
Income taxes paid | 3,726 | 2,928 | 1,241 | |
Interest paid | 198 | 1,249 | 1,232 | 97 |
Supplemental disclosure of noncash information: | ||||
Property and equipment purchases in accounts payable and accrued liabilities | $ 1,899 | $ 322 | $ 1,793 | $ 3,407 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss |
Beginning balance at Sep. 30, 2015 | $ 386,887 | $ 424 | $ 613,746 | $ (199,712) | $ (27,571) |
Beginning balance, Shares at Sep. 30, 2015 | 261,180,000 | ||||
Issuance of common stock in public offering, net of issuance costs | 273,804 | $ 52 | 273,752 | ||
Issuance of common stock in public offering, net of issuance costs, Shares | 38,640,000 | ||||
Issuance of common stock from exercise of stock options | 972 | $ 3 | 969 | ||
Issuance of common stock from exercise of stock Options, Shares | 2,273,000 | ||||
Net loss | (91,696) | (91,696) | |||
Stock-based compensation | 12,661 | 12,661 | |||
Other comprehensive loss | (56,955) | (56,955) | |||
Ending balance at Sep. 30, 2016 | 525,673 | $ 479 | 901,128 | (291,408) | (84,526) |
Ending balance, Shares at Sep. 30, 2016 | 302,093,000 | ||||
Issuance of common stock from exercise of stock options | 122 | $ 3 | 119 | ||
Issuance of common stock from exercise of stock Options, Shares | 2,347,000 | ||||
Net loss | (170,459) | (170,459) | |||
Stock-based compensation | 15,479 | 15,479 | |||
Other comprehensive loss | 10,008 | 10,008 | |||
Ending balance at Sep. 30, 2017 | 380,823 | $ 482 | 916,726 | (461,867) | (74,518) |
Ending balance, Shares at Sep. 30, 2017 | 304,440,000 | ||||
Issuance of common stock in public offering, net of issuance costs | 297,932 | $ 44 | 297,888 | ||
Issuance of common stock in public offering, net of issuance costs, Shares | 33,120,000 | ||||
Issuance of common stock from exercise of stock options | 620 | $ 4 | 616 | ||
Issuance of common stock from exercise of stock Options, Shares | 2,687,000 | ||||
Net loss | (295,167) | (295,167) | |||
Stock-based compensation | 31,627 | 31,627 | |||
Other comprehensive loss | (676) | (676) | |||
Ending balance at Sep. 30, 2018 | 415,159 | $ 530 | 1,246,857 | (757,034) | (75,194) |
Ending balance, Shares at Sep. 30, 2018 | 340,247,000 | ||||
Issuance of common stock in public offering, net of issuance costs | 324,638 | $ 34 | 324,604 | ||
Issuance of common stock in public offering, net of issuance costs, Shares | 26,220,000 | ||||
Issuance of common stock from exercise of stock Options, Shares | 150,000 | ||||
Net loss | (71,906) | (71,906) | |||
Stock-based compensation | 9,683 | 9,683 | |||
Other comprehensive loss | (3,494) | (3,494) | |||
Ending balance at Dec. 31, 2018 | $ 674,080 | $ 564 | $ 1,581,144 | $ (828,940) | $ (78,688) |
Ending balance, Shares at Dec. 31, 2018 | 366,617,000 |
Business Overview
Business Overview | 3 Months Ended |
Dec. 31, 2018 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Business Overview | Note 1: Business Overview GW Pharmaceuticals plc and its subsidiaries (the “Company”) are primarily involved in the development of cannabinoid prescription medicines using botanical extracts derived from the Cannabis plant. The Company is developing a portfolio of cannabinoid medicines, of which the lead product is Epidiolex® The Company is a public limited company, which has had American Depository Shares (“ADSs”) registered with the U.S. Securities and Exchange Commission (“SEC”) and has been listed on Nasdaq since May 1, 2013. Until December 5, 2016, the Company was also listed on the Alternative Investment Market, which is a submarket of the London Stock Exchange. The Company is incorporated and domiciled in the United Kingdom. The address of the Company’s registered office and principal place of business is Sovereign House, Vision Park, Histon, Cambridgeshire. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 2: Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Change of Fiscal Year We have changed our fiscal year end to December 31 from September 30. This transition report is for the three-month period of October 1, 2018 through December 31, 2018, which we refer to as the transition period. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. Foreign Currency Translation The financial position and results of operations of the Company’s non-U.S. subsidiaries are generally determined using local currency as the functional currency. Assets and liabilities of these subsidiaries are translated at the exchange rate in effect at each year end. Income statement accounts are translated at the average rate of exchange prevailing during the year. Adjustments arising from the use of differing exchange rates from period to period are included in accumulated other comprehensive loss in stockholders’ equity. Foreign currency transaction gains and losses are included in “foreign exchange (loss) gain” in the Company’s consolidated statements of operations. Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity date of three months or less to be cash equivalents. Fair Value of Financial Instruments The carrying values of the Company’s financial instruments, consisting of cash and cash equivalents, trade receivables, interest and other receivables, and accounts payable and accrued liabilities, approximate fair value due to the relative short-term nature of these instruments. Accounts Receivable Accounts receivable are recorded net of customer allowances for prompt payment discounts, chargebacks, and doubtful accounts. Allowances for prompt payment discounts and chargebacks are based on contractual terms. The Company estimates the allowance for doubtful accounts based on existing contractual payment terms, actual payment patterns of its customers and individual customer circumstances. As of December 31, 2018, September 30, 2018 and September 30, 2017, the Company determined that an allowance for doubtful accounts was not required and no accounts were written off during the periods presented. Inventory Inventory is stated at the lower of cost or estimated net realizable value. The Company uses a combination of standard and actual costing methodologies to determine the cost basis for its inventories which approximates actual cost. Inventory is valued on a first-in, first-out basis. The Company reduces its inventory to net realizable value for potentially excess, dated or obsolete inventory based on an analysis of forecasted demand compared to quantities on hand, as well as product shelf life. The Company capitalizes inventory costs associated with its products upon regulatory approval when, based on management’s judgment, future commercialization is considered probable and the future economic benefit is expected to be realized; otherwise, such costs are expensed. Prior to FDA approval of Epidiolex, all costs related to the manufacturing of Epidiolex were charged to research and development expense in the period incurred. Property, Plant, and Equipment Property, plant, and equipment are recorded at cost and depreciated over their estimated useful lives using the straight-line method. Leasehold improvements are amortized over the shorter of their estimated useful lives or the term of the lease by use of the straight-line method. The estimated useful lives for buildings and leasehold improvements range from 4 to 20 years. The estimated useful lives of machinery and equipment range from 3 to 20 years. Construction-in-process reflects amounts incurred for property, equipment or improvements that have not been placed in service. Maintenance and repair costs are expensed as incurred. When assets are retired or sold, the assets and accumulated depreciation are removed from the respective accounts and any gain or loss is recognized. Impairment of Long-Lived Assets The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability is measured by a comparison of the carrying amount of an asset to estimated future operating cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. Goodwill Goodwill represents the excess of purchase price over fair value of net assets acquired in a business combination and is not amortized. Goodwill is subject to impairment testing at least annually or when a triggering event occurs that could indicate a potential impairment. We performed the annual assessment for goodwill impairment in October of 2018, noting no impairment Revenue Recognition The Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of Accounting Standards Codification 606, Revenue from Contracts with Customers Revenue for the Company’s product sales has not been adjusted for the effects of a financing component as the Company expects, at contract inception, that the period between when the Company’s transfers control of the product and when the Company receives payment will be one year or less. Product shipping and handling costs are included in cost of sales. Epidiolex Product Net Sales Epidiolex was approved by the United States Food and Drug Administration (“FDA”) in June 2018. Subsequent to the approval by the FDA, the United States Drug Enforcement Agency (“DEA”) took action to change the classification of Epidiolex from a Schedule I controlled substance to Schedule V controlled substance, thereby allowing Epidiolex prescribed and distributed in the United States. On November 1, 2018, the Company launched sales of Epidiolex to specialty pharmacies (“SPs”) and specialty distributors (“SDs”). The Company recognizes revenue from product sales upon receipt of product at the SPs and SDs, the date at which the control is transferred, net of the following allowances and reflects each of these as either a reduction to the related account receivable or as an accrued liability, depending on how the allowance is settled: Distribution Fees : Distribution fees include distribution service fees paid to the SPs and SDs based on a contractually fixed percentage of the wholesale acquisition cost (“WAC”), fees for data, and prompt payment discounts. Distribution fees are recorded as an offset to revenue based on contractual terms at the time revenue from the sale is recognized. Rebates : Allowances for rebates include mandated discounts under the Medicaid Drug Rebate Program and the Medicare Part D prescription drug benefit. Rebates are amounts owed after the final dispensing of the product to a benefit plan participant and are based upon contractual agreements with, or statutory requirements pertaining to, Medicaid and Medicare benefit providers. The allowance for rebates is based on statutory discount rates and expected utilization. The Company’s estimates for expected utilization of rebates is based on utilization data received from the SPs since product launch. Rebates are generally invoiced and paid in arrears so that the accrual balance consists of an estimate of the amount expected to be incurred for the current quarter’s activity, plus an accrual balance for prior quarters’ unpaid rebates. If actual future rebates vary from estimates, the Company may need to adjust prior period accruals, which would affect revenue in the period of adjustment. Chargebacks : Chargebacks are discounts and fees that relate to contracts with government and other entities purchasing from the SDs at a discounted price. The SDs charge back to the Company the difference between the price initially paid by the SDs and the discounted price paid to the SDs by these entities. The Company also incurs group purchasing organization fees for transactions through certain purchasing organizations. The Company estimates sales with these entities and accrues for anticipated chargebacks and organization fees, based on the applicable contractual terms. If actual future chargebacks vary from these estimates, the Company may need to adjust prior period accruals, which would affect revenue in the period of adjustment. Co-Payment Assistance : The Company offers co-payment assistance to commercially insured patients meeting certain eligibility requirements. Co-payment assistance is accrued for based on actual program participation and estimates of program redemption using data provided by third-party administrators. Product Returns : Consistent with industry practice, the Company offers the SPs and SDs limited product return rights for damages, shipment errors, and expiring product; provided that the return is within a specified period around the product expiration date as set forth in the applicable individual distribution agreement. The Company does not allow product returns for product that has been dispensed to a patient. As the Company receives inventory reports from the SPs and SDs and has the ability to control the amount of product that is sold to the SPs and SDs, it is able to make a reasonable estimate of future potential product returns based on this on-hand channel inventory data and sell-through data obtained from the SPs and SDs. In arriving at its estimate, the Company also considers historical product returns, the underlying product demand, and industry data specific to the specialty pharmaceutical distribution industry. Sativex Product Net Sales Sales of Sativex, which is currently being commercialized for spasticity due to multiple sclerosis (“MS”) outside the United States, are made pursuant to license agreements with commercial partners Other Revenue The Company’s other revenue primarily consists of research and development fee revenue for research and development services provided under a collaboration agreement with Otsuka Pharmaceutical Co. Ltd (“Otsuka”) The research and development fee revenue is recognized at the time the underlying services are performed. The Sativex license agreements contain provisions for the Company to earn variable consideration in the form of regulatory milestone payments, sales-based milestone payments, and royalty payments. The Company has no further performance obligations related to the regulatory milestone payments and these amounts are recognized in accordance with Topic 606 when receipt of these payments becomes probable and there is no significant risk of revenue reversal. Revenue related to the sales-based milestone payments and product royalty payments are subject to the sales-based royalty exception under Topic 606 and will be recognized when the underlying sales are made. Research and Development Expenses Research and development expenses are charged to operations as incurred. Research and development expenses include, among other things, internal and external costs associated with preclinical development, pre-commercialization manufacturing expenses, and clinical trials. The Company accrues for costs incurred as the services are being provided by monitoring the status of the trial or services provided and the invoices received from its external service providers. In the case of clinical trials, a portion of the estimated cost normally relates to the projected cost to treat a patient in the trials, and this cost is recognized based on the number of patients enrolled in the trial. As actual costs become known, the Company adjusts its accruals accordingly. Research and development expense is presented net of reimbursements from reimbursable tax and expenditure credits from the U.K. government. Prior to September 30, 2017, the Company benefited from the U.K. Small and Medium-sized Enterprise R&D Tax Credit scheme, under which companies are able to obtain a refundable credit of up to 33.4% of eligible research and development expenses incurred by U.K. domiciled entities. Due to the increase in the size of the Company’s employee workforce in the U.K. and annual net revenues, beginning October 1, 2017 the Company is subject to the U.K. R&D Expenditure Credit scheme, available to larger companies, which has a significantly lower credit than the SME scheme. The majority of the Company’s pipeline research, clinical trials management and the Epidiolex and Sativex chemistry and manufacturing controls development activities, which are generally carried out by a subsidiary in the U.K., are eligible for inclusion under the U.K tax and expenditure rebate schemes. For the three months ended December 31, 2018 and years ended September 30, 2018, 2017 and 2016, the Company recorded $0.8 million, $4.3 million, $26.0 million and $30.5 million, respectively, of U.K. tax and expenditure rebates as a component of research and development expense. Concentration Risk Financial instruments, which potentially subject the Company to concentrations of credit risk, principally consist of cash, cash equivalents, investment securities, and accounts receivable. The Company’s cash and cash equivalents balances are primarily in depository accounts at major financial institutions in accordance with the Company’s investment policy. The Company’s investment policy defines allowable investments and establishes guidelines relating to credit quality, diversification, and maturities of its investments to preserve principal and maintain liquidity. Further, the Company specifies credit quality standards for its customers that are designed to limit the Company’s credit exposure to any single party. For the three months ended December 31, 2018, the Company’s five largest customers represented approximately 71% of the Company’s product net sales and 75% of the Company’s accounts receivable balance as of December 31, 2018. For the years ended September 30, 2018, 2017 and 2016, product net sales consisted entirely of Sativex sales outside of the United States pursuant to license agreements with a small number of commercial partners. Share-based Compensation The Company recognizes share-based compensation expense for grants of stock options under the Company's Long-Term Incentive Plans to employees and non-employee members of the Company's board of directors based on the grant-date fair value of those awards. The grant-date fair value of an award is generally recognized as compensation expense over the award's requisite service period. Expense related to awards with graded vesting is generally recognized over the vesting period using the accelerated attribution method. The Company uses the Black-Scholes model to compute the estimated fair value of stock option awards. Using this model, fair value is calculated based on assumptions with respect to (i) expected volatility of the Company's ADS price, (ii) the periods of time over which employees and members of the board of directors are expected to hold their options prior to exercise (expected lives), (iii) expected dividend yield on the ordinary shares, and (iv) risk-free interest rates. Share-based compensation expense also includes an estimate, which is made at the time of grant, of the number of awards that are expected to be forfeited. This estimate is revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Income Taxes The Company recognizes deferred tax assets and liabilities for temporary differences between the financial reporting basis and the tax basis of the Company's assets and liabilities along with net operating loss and tax credit carryovers. The Company records a valuation allowance against its deferred tax assets to reduce the net carrying value to an amount that it believes is more likely than not to be realized. When the Company establishes or reduces the valuation allowance against its deferred tax assets, its provision for income taxes will increase or decrease, respectively, in the period such determination is made. Valuation allowances against the Company’s deferred tax assets were $101.6 million, $97.5 million and $46.1 million at December 31, 2018, September 30, 2018 and September 30, 2017, respectively. Changes in the valuation allowances are generally recognized in the provision for income taxes as a component of the estimated annual effective tax rate. Uncertain tax positions, for which management's assessment is that there is more than a 50% probability of sustaining the position upon challenge by a taxing authority based upon its technical merits, are subjected to certain recognition and measurement criteria. The Company re-evaluates uncertain tax positions and considers various factors, including, but not limited to, changes in tax law, the measurement of tax positions taken or expected to be taken in tax returns, and changes in facts or circumstances related to a tax position. The Company adjusts the level of the liability to reflect any subsequent changes in the relevant facts and circumstances surrounding the uncertain positions. The Company recognizes interest and penalties related to income tax matters in income tax expense. Net Loss Per Share Basic net loss per share is calculated by dividing the net loss by the weighted average number of common shares outstanding for the period, without consideration for common stock equivalents. Diluted net loss per share is computed by dividing the net loss by the weighted average number of common shares and common stock equivalents outstanding for the period determined using the treasury stock method. For purposes of this calculation, market-priced stock options are considered to be common stock equivalents but are not included in the calculations of diluted net loss per share for the periods presented as their effect would be anti-dilutive. Nominal strike-price options are considered common stock equivalents and are included in the calculation of basic weighted average shares outstanding once they have become vested. The Company incurred net losses for all periods presented and there were no reconciling items for potentially dilutive securities. More specifically, at December 31, 2018, and September 30, 2018, 2017 and 2016, options totaling approximately Segment and Geographic Reporting Management has determined that the Company operates in one business segment which is the discovery, development and commercialization of novel therapeutics from its proprietary cannabinoid product platform in a broad range of disease areas. Revenues recorded in the three months ended December 31, 2018 and years ended September 30, 2018, 2017 and 2016 were generated in the following geographical areas: Three Months Ended December 31, Years Ended September 30, 2018 2018 2017 2016 (in thousands) Europe $ 1,131 $ 6,882 $ 5,447 $ 5,021 United Kingdom 220 1,761 1,758 1,363 United States 4,669 1,560 121 4,917 Canada 347 1,031 743 955 Asia / Other 287 1,503 560 474 Total revenues $ 6,654 $ 12,737 $ 8,629 $ 12,730 Long-lived assets which include property, plant, and equipment were located as follows: December 31, September 30, 2018 2018 2017 (in thousands) United Kingdom $ 89,550 $ 81,405 $ 62,344 United States 1,282 976 831 Total long-lived assets $ 90,832 $ 82,381 $ 63,175 Recently Issued Accounting Standards In February 2016, the FASB issued ASU 2016-02, Leases , which requires a lessee to recognize a lease liability and a right-of-use asset for all leases with lease terms of more than 12 months and requires disclosure of key information about leasing arrangements. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The classification criteria for distinguishing between operating and finance (previously capital) leases are substantially similar to the previous lease guidance, but with no explicit bright lines. ASU No. 2016-02 became effective for the Company as of January 1, 2019. The Company elected the transition method that allows it to apply the standard as of the adoption date and record a cumulative adjustment in retained earnings, if applicable. The Company has also elected the package of practical expedients permitted under the transition guidance, which among other things, allows the Company to carryforward the historical lease classification. The new standard also provides practical expedients for an entity’s ongoing accounting. The Company has made an accounting policy election to keep leases with an initial term of 12 months or less off of the balance sheet and recognize those lease payments in the consolidated statements of operations on a straight-line basis over the lease term. The Company has also elected the practical expedient to not separate lease and non-lease components for all of its leases as the non-lease components are not significant to the overall lease costs. While the Company is still finalizing the adoption procedures, the Company estimates that the adoption of this standard will result in recognition of additional lease assets and lease liabilities on its consolidated balance sheet as of January 1, 2019 of approximately $13.0 million to $17.0 million. Additionally, the Company’s build-to-suit financing obligation will be classified as a finance lease liability. The Company does not believe the adoption of ASU No. 2016-02 will materially affect its consolidated net loss or liquidity. |
Sativex License Agreements
Sativex License Agreements | 3 Months Ended |
Dec. 31, 2018 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Sativex License Agreements | Note 3: Sativex License Agreements The Company has entered into six separate license agreements for Sativex the respective partner with exclusive rights in a defined geographic territory to commercialize Sativex in all indications, while the Company retains the exclusive right to manufacture and supply Sativex to license partners on commercial supply terms for the duration of the commercial life of the product. In November 2016, the Company entered into a mutual termination agreement with Novartis Pharma AG (“Novartis”), pursuant to which rights in Sativex in Australia and New Zealand, Asia (excluding Japan, China and Hong Kong), the Middle East (excluding Israel) and Africa will be returned to the Company over an agreed transition period. In December 2017, the Company entered into a mutual termination agreement with Otsuka to return the rights to develop and commercialize Sativex in the United States to the Company. As part of the termination agreement, the Company agreed to pay Otsuka a contingent future milestone payment of $10 million if Sativex achieves FDA approval in the U.S. and a total of $30 million of potential sales-based milestones if U.S. sales of Sativex reach certain thresholds. As of December 31, 2018, no amounts have been accrued related to the contingent payments because it is not probable that the milestones will be achieved. Sativex in the United States In 2007, the Company entered into an exclusive license agreement with Otsuka for the development and commercialization of Sativex in the United States. Under the terms of the agreement, Otsuka was responsible for substantially all development costs and the commercialization of Sativex in the United States. GW was responsible to perform certain Otsuka-funded development activities and supply Sativex to Otsuka. The financial terms of this agreement included an $18.0 million up-front license payment and potential future contingent development, regulatory and commercial milestone payments. GW earned a $4.0 million regulatory milestone payment related to the commencement of the first Phase 3 clinical trial for cancer pain in 2010, but ultimately did not earn any additional milestone payments before the agreement was terminated in December 2017. Sativex in the United Kingdom and Canada In 2003, the Company entered into an exclusive agreement with Bayer to commercialize Sativex in the United Kingdom. This agreement was amended later in 2003 to include Canada. Under the terms of the agreement, GW is the marketing authorization holder for Sativex in the United Kingdom and Canada and is responsible for supplying commercial product to Bayer. The financial terms of the agreement included an upfront fee of $8.2 million, a per-unit supply price, and potential contingent development, regulatory, and sales-based milestone payments. In total, the Company has received $24.2 million in milestone payments from Bayer with the potential to receive a further $11.7 million in future contingent regulatory milestone payments. The Company’s revenue from the supply of Sativex to Bayer equates to a percentage in the mid-thirties to forty percent of Bayer’s in-market net sales price. Sativex in Europe In 2005, the Company entered into an exclusive agreement with Almirall, an international pharmaceutical company with headquarters in Spain, to commercialize Sativex in the European Union (excluding the United Kingdom) and E.U. accession countries, as well as Switzerland, Norway and Turkey. In 2012, this agreement was amended to add Mexico as a licensed territory. In countries where Almirall has no direct presence at the time of product launch, the Company and Almirall will jointly agree on the appointment of distribution partners. In such countries, the Company may elect to distribute the product itself. Under the terms of this agreement, the Company is the marketing authorization holder for Sativex in all countries in the territory, except where local regulations require a locally registered entity to assume this responsibility. The Company is responsible for supplying commercial product to Almirall. The financial terms of the agreement include an up-front license fee of $21.5 million, a per-unit supply price, and $54.6 million in potential contingent regulatory and commercial milestone payments. To date, the Company has received $32.5 million in milestone payments from Almirall with the potential to receive an additional $5.2 million in regulatory and clinical milestones and $16.9 million in sales-based milestones. The Company receives revenue from the supply of Sativex to Almirall, currently equating to a percentage in the low to mid-twenties of Almirall’s in-market net sales price. This percentage will increase to the mid-thirties of net sales price beginning on January 1, 2021. Sativex in Latin America, Asia, the Middle East and Africa In 2011, GW entered into an exclusive agreement with Novartis to commercialize Sativex in Australia and New Zealand, Asia (excluding Japan, China and Hong Kong), the Middle East (excluding Israel) and Africa. Under the terms of the agreement, Novartis held exclusive commercialization rights to Sativex in the licensed territories and acted as the marketing authorization holder for Sativex. GW was responsible for supplying commercial product to Novartis. The financial terms of the agreement included an up-front license fee of $5.0 million from Novartis and potential future milestone payments. In November 2016, the Company entered into a mutual termination agreement with Novartis, pursuant to which rights to Sativex in these territories will return to GW over a transition period. In 2017, GW entered into an agreement with a distributor in Australia and New Zealand for the sale of Sativex In 2014, the Company entered into an exclusive agreement with Ipsen. Under the terms of this agreement, Ipsen will promote and distribute Sativex in Latin America (excluding Mexico and the Islands of the Caribbean). In 2010, the Company entered into an exclusive agreement with Neopharm, an Israeli pharmaceutical company, to commercialize Sativex in Israel. Under the terms of this agreement, Neopharm acts as market authorization holder in the territory and GW is responsible for supplying commercial product to Neopharm. Revenue from the supply of products to Neopharm is expected to equate to forty to fifty percent of Neopharm’s in-market net sales revenue. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 4: Fair Value Measurements As of December 31, 2018 and September 30, 2018, the Company’s cash equivalents consisted of money market funds, which are classified as Level 1 within the fair value hierarchy defined by authoritative guidance. At September 30, 2017, the Company’s cash and cash equivalents consisted of short-term cash deposits. Investment securities classified as Level 1 are valued using quoted market prices. |
Composition of Certain Balance
Composition of Certain Balance Sheet Captions | 3 Months Ended |
Dec. 31, 2018 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Composition of Certain Balance Sheet Captions | Note 5: Composition of Certain Balance Sheet Captions: Inventory consisted of the following: December 31, September 30, 2018 2018 2017 (in thousands) Raw materials $ 676 $ 506 $ 267 Work in process 28,709 17,529 4,513 Finished goods 3,645 1,026 889 $ 33,030 $ 19,061 $ 5,669 Property, plant and equipment, net, consisted of the following: December 31, September 30, 2018 2018 2017 (in thousands) Build-to-suit property 4,573 4,694 4,812 Machinery and equipment 32,598 33,303 28,431 Leasehold improvements 36,004 36,091 36,063 Office and IT equipment 2,481 2,109 2,108 Construction-in-process 44,546 34,165 12,319 120,202 110,362 83,733 Accumulated depreciation (29,370 ) (27,981 ) (20,558 ) $ 90,832 $ 82,381 $ 63,175 As a result of the application of build-to-suit lease guidance, the Company has determined that it is the accounting owner of its primary production facility. It is included in the Company’s property, plant and equipment as build-to-suit property. The capitalized amount of the build-to-suit property is equal to the construction costs of the landlord for the shell building. See Note 10—Commitments and Contingencies for additional information. Depreciation of property and equipment was $2.2 million, $8.5 million, $7.0 million, and $5.1 million for the three months ended December 31, 2018 and for the years ended September 30, 2018, 2017, and 2016, respectively. The Company did not retire any property, plant, or equipment in the three months ended December 31, 2018. During the years ended September 30, 2018, 2017, and 2016, the Company retired $0.5 million, $1.8 million, and $1.4 million, respectively, of fully depreciated property, plant and equipment. Accrued liabilities consisted of the following: December 31, September 30, 2018 2018 2017 (in thousands) Accrued compensation and benefits $ 18,482 $ 15,578 6,749 Accrued vendor fees 11,452 12,773 8,983 Clinical trial accruals 10,059 8,487 6,687 Accrued growing fees 2,717 2,890 2,274 Accrued sales rebates and discounts 628 - - Other 9,139 7,011 8,963 $ 52,477 $ 46,739 $ 33,656 Other liabilities consisted of the following: December 31, September 30, 2018 2018 2017 (in thousands) Landlord financing obligation $ 9,434 $ 10,368 $ 10,629 Other 648 426 209 $ 10,082 $ 10,794 $ 10,838 |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Stockholders' Equity | Note 6: Stockholders’ Equity In October 2018, the Company completed a public offering of 2,185,000 ADSs listed on the Nasdaq Global Market, representing 26,220,000 ordinary shares of the Company, at a price of $158.00 per ADS. The net proceeds from this transaction after underwriting discounts and commissions were approximately $324.6 million. In December 2017, the Company completed a public offering of 2,760,000 ADSs listed on the Nasdaq Global market, representing 33,120,000 ordinary shares of the Company, at a price of $115.00 per ADS. The net proceeds from this transaction after underwriting discounts and commissions were approximately $297.9 million. In July 2016, the Company completed a public offering of 3,220,000 ADSs listed on the Nasdaq Global market, representing 38,640,000 ordinary shares of the Company at a price of $90.00 per ADS. The net proceeds from this transaction after underwriting discounts and commissions were approximately $273.8 million. |
Share-Based Compensation
Share-Based Compensation | 3 Months Ended |
Dec. 31, 2018 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Share-Based Compensation | Note 7: Share-Based Compensation Stock Plans In March 2008, the Company adopted the GW Pharmaceuticals plc Long-Term Incentive Plan (“the 2008 LTIP Plan”). Share based awards granted by the Company from March 2008 to March 2017 were granted under the 2008 LTIP Plan. On March 14, 2017, the Company adopted the GW Pharmaceuticals plc 2017 Long-Term Incentive Plan (“the 2017 LTIP Plan”). The 2017 LTIP plan authorizes the Company to issue up to an aggregate of 15,000,000 ordinary shares, or 1,250,000 ADSs, related to share-based awards to employees, non-employee directors and consultants. No grants under the 2017 LTIP Plan may be made after March 13, 2022. As of December 31, 2018, 6,706,971 ordinary shares have been or may be issued pursuant to share-based awards that have been granted under the 2017 LTIP Plan. The Company issues new ordinary shares and the commensurate number of ADS when share-based awards are exercised. Provisions of Share-Based Awards The Company issues nominal strike price stock options, which have an exercise price equal to the £0.001 par value per ordinary share of the Company’s ordinary shares, to executive officers, employees and consultants. The Company also issues market-priced options to executive officers and non-employee directors. Nominal strike priced options granted to U.S. residents prior to April 2017 contain short-term expiration provisions so the awards are compliant with provisions of IRS Code 409(a). Nominal strike price options granted to U.S. residents beginning in April 2017 are awarded in the form of RSU-style options that automatically exercise on the vesting date. Substantially all of the share-based awards issued by the Company have service-based vesting conditions. Many awards also have non-market-based performance conditions, which must be achieved within the service-based vesting period for the awards to vest. These performance conditions are generally linked to operational, regulatory or strategic milestones and are designed to incentivize individual employees and advance the Company’s progress towards its strategic objectives. Share-based awards that do not automatically exercise at vest date expire ten years from the date of grant. Share-Based Award Activity The following tables summarize the Company’s stock option activity. The number of options, the weighted average grant date fair value per stock option, and the weighted average exercise price are all on a per ordinary shares basis. The Company’s ADSs that are listed on the Nasdaq Global Market each represent twelve ordinary shares. The following table summarizes the Company’s nominal strike price stock option activity: Three Months Ended Years Ended December 31, September 30, 2018 2018 2017 2016 Nominal Strike Price Options Weighted Average Grant Date Fair Value Nominal Strike Price Options Weighted Average Grant Date Fair Value Nominal Strike Price Options Weighted Average Grant Date Fair Value Nominal Strike Price Options Weighted Average Grant Date Fair Value (in thousands, except weighted average grant date fair value) Outstanding, beginning of period 11,240 $ 8.41 9,752 $ 7.90 9,182 $ 5.16 7,334 $ 6.61 Granted 184 9.58 4,247 9.34 3,097 9.66 3,750 4.38 Exercised (150 ) 7.36 (2,617 ) 7.21 (2,239 ) 3.21 (1,610 ) 2.05 Cancelled (92 ) 8.61 (142 ) 9.37 (288 ) 6.69 (292 ) 4.07 Outstanding, end of period 11,182 $ 8.44 11,240 $ 8.41 9,752 $ 7.90 9,182 $ 5.16 Exercisable, end of period 1,054 $ 3.65 1,136 $ 6.11 1,986 $ 4.52 3,058 $ 2.60 The following table summarizes the Company’s market-priced stock option activity: Three Months Ended Years Ended December 31, September 30, 2018 2018 2017 2016 Market Strike Price Options Weighted Average Exercise Price Market Strike Price Options Weighted Average Exercise Price Market Strike Price Options Weighted Average Exercise Price Market Strike Price Options Weighted Average Exercise Price (in thousands, except weighted average grant date fair value) Outstanding, beginning of period 2,889 $ 8.49 2,174 $ 8.28 1,452 $ 5.80 1,098 $ 7.89 Granted — — 785 9.65 830 9.62 1,017 4.09 Exercised — — (70 ) 9.03 (108 ) 1.15 (663 ) 1.50 Outstanding, end of period 2,889 $ 8.49 2,889 $ 8.49 2,174 $ 8.28 1,452 $ 5.80 Exercisable, end of period 461 $ 6.90 257 $ 8.74 — — 107 $ 1.17 The weighted average per share fair value of market priced options granted during the years ended September 30, 2018, 2017, and 2016 was $ 5. The aggregate intrinsic value of the stock options exercised in the three months ended December 31, 2018 was $1.6 million. The aggregate intrinsic value of stock options exercised in the years ended September 30, 2018, 2017 and 2016 was $ 30.7 22.9 13.1 5.1 5.4 97.39 97.8 9.8 Valuation and Expense Recognition of Share-Based Awards The fair value of stock option awards that do not contain a market condition is estimated using the Black-Scholes option-pricing model. The estimated fair value of each stock option is then expensed over the requisite service period, which is generally the vesting period. The determination of fair value using the Black-Scholes model is affected by the Company’s ADS price as well as assumptions regarding a number of complex and subjective variables, including expected ADS price volatility, risk-free interest rate, expected dividends and projected employee stock option exercise behaviors. Stock options granted during the three months ended December 31, 2018 and the years ended September 30, 2018, 2017 and 2016 were valued using the Black-Scholes option-pricing model with the following weighted-average assumptions: Three Months Ended December 31, Years Ended September 30, 2018 2018 2017 2016 Expected volatility 58 % 63 % 69 % 58 % Risk-free interest rate 2.70 % 2.30 % 1.93 % 1.30 % Expected dividend yield 0 % 0 % 0 % 0 % Expected life of options in years 6.50 6.50 6.50 5.85 The Company estimates its stock price volatility based using a combination of historical stock price volatility and the average implied volatility of options traded in the open market. The risk-free interest rate assumption is based on observed interest rates for the appropriate term of the Company’s stock options. The Company has never declared or paid dividends and has no plans to do so in the foreseeable future. The expected option life assumption is estimated using the simplified method prescribed by ASC 718 and is based on the mid-point between vest date and expiration date since the Company does not have sufficient exercise history to estimate expected option life of historical grants. Compensation expense for share-based awards based on a service condition is recognized only for those awards that are ultimately expected to vest. An estimated forfeiture rate has been applied to unvested awards for the purpose of calculating compensation cost. Forfeitures were estimated based on historical experience. These estimates are revised, if necessary, in future periods if actual forfeitures differ from the estimates. Changes in forfeiture estimates impact compensation cost in the period in which the change in estimate occurs. Compensation expense for share-based awards with graded, service-based vesting conditions is recognized over the requisite service period using the accelerated attribution method. The table below summarizes the total share-based compensation expense included in the Company’s statements of operations for the periods presented (in thousands): Three Months Ended December 31, Years Ended September 30, 2018 2018 2017 2016 Research and development $ 6,887 $ 9,385 $ 5,239 $ 6,586 Sales, general and administrative 2,382 22,242 10,240 6,075 $ 9,269 $ 31,627 $ 15,479 $ 12,661 For the three months ended December 31, 2018, $0.4 million of share-based compensation related to manufacturing operations was capitalized into inventory. Share-based compensation related to manufacturing operations capitalized into inventory for the years ended September 30, 2018, 2017, and 2016 were negligible. As of December 31, 2018, total compensation cost related to non-vested stock options not yet recognized was approximately $39.7 million, which is expected to be recognized over the next 38 months (11 months on a weighted average basis). |
Retirement Plans
Retirement Plans | 3 Months Ended |
Dec. 31, 2018 | |
Compensation And Retirement Disclosure [Abstract] | |
Retirement Plans | Note 8: Retirement Plans The Company operates defined contribution retirement plans in the U.S. and U.K. for the benefit of all qualifying employees. The Company makes discretionary contributions to these plans and contributed $0.9 million, $3.3 million, $2.5 million, and $1.9 million in the three months ended December 31, 2018 and years ended September 30, 2018, 2017, and 2016, respectively. |
Income Taxes
Income Taxes | 3 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 9: Income Taxes Income (loss) before income taxes is as follows: Three Months Ended December 31, Years Ended September 30, 2018 2018 2017 2016 (in thousands) United States $ 1,487 $ 12,041 $ 3,725 $ 2,030 United Kingdom (73,659 ) (303,411 ) (175,216 ) (94,419 ) $ (72,172 ) $ (291,370 ) $ (171,491 ) $ (92,389 ) The components of income tax (benefit) expense are as follows: Three Months Ended December 31, Years Ended September 30, 2018 2018 2017 2016 (in thousands) Current U.S. federal $ 945 $ 3,885 $ 2,676 $ 1,534 U.S. state and local 54 229 62 116 United Kingdom — — — — Total Current $ 999 $ 4,114 $ 2,738 $ 1,650 Deferred U.S. federal $ (1,166 ) $ (263 ) $ (3,685 ) $ (2,178 ) U.S. state and local (99 ) (54 ) (85 ) (165 ) United Kingdom — — — — Total Deferred $ (1,265 ) $ (317 ) $ (3,770 ) $ (2,343 ) Total income tax (benefit) expense $ (266 ) $ 3,797 $ (1,032 ) $ (693 ) As of December 31, 2018, September 30, 2018, and September 30, 2017, respectively, the tax effects of temporary differences and carryforwards that give rise to deferred tax assets and liabilities were as follows: Three Months Ended December 31, Years Ended September 30, 2018 2018 2017 (in thousands) Deferred tax assets: Net operating losses $ 94,999 $ 94,570 $ 46,379 Research and development tax credits 180 180 506 Share-based compensation 10,057 8,745 7,496 Accrued expenses 2,275 2,320 1,787 Capitalized costs 3,219 — — Other 825 291 199 Total gross deferred tax assets, net of valuation allowance 111,555 106,106 56,367 Valuation allowance (101,606 ) (97,462 ) (46,126 ) 9,949 8,644 10,241 Deferred tax liabilities: Depreciation $ (1,229 ) $ (1,310 ) $ (2,220 ) Deferred revenue — — (1,216 ) Total gross deferred tax liabilities (1,229 ) (1,310 ) (3,436 ) Net of deferred tax assets and liabilities $ 8,720 $ 7,334 $ 6,805 A valuation allowance of $101.6 million, $97.5 million, and $46.1 million at December 31, 2018, September 30, 2018 and 2017, respectively, has been recognized to offset net deferred tax assets where realization of such assets is uncertain. The valuation allowances are primarily related to deferred tax assets for operating loss carryforwards and temporary differences related to share-based compensation expense of the Company’s U.K. operations. On December 22, 2017, the President of the United States signed into law the Tax Cuts and Jobs Act of 2017 (“2017 The following table reconciles the Company’s effective tax rate to the United Kingdom statutory rate: Three Months Ended December 31, Years Ended September 30, 2018 2018 2017 2016 Tax, computed at the UK statutory rate 19.0 % 19.0 % 19.5 % 20.0 % U.S. research tax credits, net 0.4 % 0.9 % 1.6 % 3.4 % Surrender of R&D expenditures for U.K. research tax credits, net 0.0 % (0.1 %) (5.7 %) (12.7 %) Foreign Derived Intangible Income 0.8 % — — — Share-based compensation 0.2 % 0.9 % 2.1 % 2.8 % Changes in valuation allowances (19.6 %) (20.5 %) (16.2 %) (10.5 %) Overseas profits taxed at different rates (0.1 %) (0.3 %) 0.0 % (0.7 %) Remeasurement of deferred taxes from 2017 Tax Act 0.0 % (1.0 %) 0.0 % 0.0 % Other (0.3 %) (0.2 %) (0.7 %) (1.6 %) Effective income tax rate 0.4 % (1.3 %) 0.6 % 0.7 % The Company is headquartered in the United Kingdom and has subsidiaries in the United Kingdom, United States, Europe, and Australia. The Company incurs tax losses in the United Kingdom. The weighted-average U.K. corporate tax rate for the three months ended December 31, 2018, and years ended September 30, 2018, 2017, and 2016 was 19.0%, 19.0%, 19.5%, 20.0%, respectively. The United Kingdom’s 2016 Finance Bill, which was enacted on September 15, 2016, contained reductions in corporation tax to 19% from April 1, 2017 and 17% from April 1, 2020. The Company used a 17% tax rate as of December 31, 2018 in respect of the measurement of deferred taxes arising in the United Kingdom, which reflects the currently enacted tax rate based upon the anticipated timing of the unwinding of the deferred tax balances. As of December 31, 2018, the Company had U.K. net operating loss carryforwards of approximately $558.8 million. Unsurrendered U.K. tax losses and tax credit carryforwards can be carried forward indefinitely to be offset against future taxable profits, however this is restricted to an annual £5 million allowance in each standalone company or group and above this allowance, there will be a 50% restriction in the profits that can be covered by losses brought forward. The Company’s subsidiary in the United States has generated taxable profits due to a service agreement between the Company’s subsidiaries in the United States and the United Kingdom and the commercialization of Epidiolex in the United States. The U.S. federal corporate tax rate for the three months ended December 31, 2018, and years ended September 30, 2018, 2017, and 2016 was 21.0%, 24.5%, 35%, and 35%, respectively. The U.S. federal statutory tax rate has decreased due to U.S. tax reform which was enacted in December 2017. The impact of income taxes outside of the United States and United Kingdom are not significant. The Company’s tax returns are subject to examination in the U.K. and U.S. The scope of these examinations includes, but is not limited to, the review of our taxable presence in a jurisdiction, the deduction of certain items, claims for research and development credits, compliance with transfer pricing rules and regulations and the inclusion or exclusion of amounts from the Company’s tax returns as filed. The Company is no longer subject to examinations by tax authorities for tax years ended September 30, 2016 and prior in the United Kingdom. The Company’s U.K. income tax returns have been submitted to Her Majesty’s Revenue and Customs through the period ended September 30, 2017 and may be subject to audit until September 30, 2019. The Company is subject to examinations by U.S. Federal tax authorities for tax years ended September 30, 2017, 2016, 2015, and by state authorities for the tax years ended September 30, 2017, 2016, 2015, and 2014. The California Franchise Tax Board has initiated an income tax audit of the Company’s U.S. subsidiary for tax years ended September 30, 2017, 2016, and 2015. The Company believes it has adequately accrued for tax deficiencies or reductions in tax benefits, if any, that could result from the examination and all open audit years. Unrecognized tax benefits arise when the estimated benefit recorded in the financial statements differs from the amounts taken or expected to be taken in a tax return because of the uncertainties described above. The Company’s total amount of unrecognized tax benefits was $1.9 million, $1.8 million, $1.1 million, and $0.9 million as of December 31, 2018, September 30, 2018, 2017, and 2016, respectively. The Company’s policy is to recognize interest and penalties related to uncertain tax positions as a component of income tax expense and unrecognized tax benefits. The amounts accrued for interest and penalty charges as of December 31, 2018, September 30, 2018, 2017, and 2016 were not significant. If recognized, $1.9 million would affect the effective tax rate. The Company does not anticipate that the amount of unrecognized tax benefits as of December 31, 2018 will significantly change within the next twelve months. The reconciliation of the beginning and ending amount of unrecognized tax benefits was as follows: Three Months Ended December 31, Years Ended September 30, 2018 2018 2017 2016 (in thousands) Balance, beginning of period $ 1,826 $ 1,134 $ 884 $ 182 Additions for tax positions related to current year 34 771 453 702 Additions for tax positions related to prior years 83 46 18 — Reduction for tax positions related to prior years — (125 ) (221 ) — Balance, end of period $ 1,943 $ 1,826 $ 1,134 $ 884 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Dec. 31, 2018 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 10: Commitments and Contingencies Leases The Company leases facilities and certain equipment under noncancelable leases that expire at various dates through September 2029. Leases are classified as capital leases when the terms of the lease transfer substantially all of the risk and rewards of ownership to the lease. Other leases are classified as operating leases. In 2018, the Company entered into a master lease agreement giving the Company the ability to lease vehicles under operating leases with initial terms of 50 months from the date of delivery. In connection with this lease agreement, the Company has established a letter of credit for $0.3 million. Property and equipment under capital leases are initially recorded at the lower of asset fair value or the present value of the minimum lease payments on the consolidated balance sheet. The corresponding liability to the lessor is included in the balance sheet as a capital lease obligation. Lease payments under capital leases are treated as debt-service payments and recognized as a reduction of the capital lease obligation and an increase in interest expense. Rent expense for operating leases is recorded on a straight-line basis over the life of the lease term. If an operating lease contains fixed and determinable escalation clauses or rent-free periods, the difference between the rent expense and the rent paid is recorded as deferred rent. Rent expense under the Company’s operating leases was $1.8 million, $5.7 million, $4.6 million, and $3.3 million, for the three months ended December 31, 2018 and years ended September 30, 2018, 2017, and 2016, respectively. Build-to-Suit Financing Obligation In 2013, the Company entered into an agreement with its landlord for the construction of a new production facility. Under the terms of the agreement, the landlord was responsible for the construction of the cold shell of the building and GW was responsible for the fit out of all internal building systems and improvements. Landlord Financing In conjunction with the build-to-suit property described above, the Company’s landlord provided $13.1 million of funding to the Company for the internal fit out of the production facility. The repayment of this landlord financing takes the form of quarterly rent payments over a 15-year period that commenced in May 2016. The landlord financing liability is accounted for at amortized cost using the effective interest method at a rate of 7.0%. As of December 31, 2018, September 30, 2018, and 2017, the total landlord financing liability balance was $10.0 million, $10.4 million and $11.1 million respectively and included in “other current liabilities” and “other liabilities” in the Company’s consolidated balance sheets. Future lease commitments The aggregate future minimum rent payments under leases in effect as of December 31, 2018, are as follows ( in thousands Lease agreements accounted for as: Capital Leases Operating Leases Build-to-Suit Financing Obligation Landlord Financing Total 2019 $ 223 $ 6,164 $ 603 $ 1,225 $ 8,215 2020 223 6,686 482 1,225 8,616 2021 223 5,436 482 1,225 7,366 2022 217 3,952 482 1,225 5,876 2023 213 2,598 482 1,225 4,518 Thereafter 824 11,011 5,872 8,787 26,494 Minimum lease commitments $ 1,923 $ 35,847 $ 8,403 $ 14,912 $ 61,085 The Company also enters into short-term agreements with various vendors and suppliers of goods and services in the normal course of operations through purchase orders or other documentation, or that are undocumented except for an invoice. Such short-term agreements are generally outstanding for periods less than a year and are settled by cash payments upon delivery of goods and services. The nature of the work being conducted under these agreements is such that, in most cases, the services may be stopped on short notice. In such event, the Company would not be liable for the full amount of the agreement and are therefore not reflected in the above table. Legal Proceedings As of December 31, 2018, we were not a party to any material legal proceedings. |
Financial Statements and Supple
Financial Statements and Supplementary Data (Unaudited) | 3 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Data [Abstract] | |
Financial Statements and Supplementary Data (Unaudited) | Note 11: Financial Statements and Supplementary Data (Unaudited) The following interim financial information reflects all normal recurring adjustments necessary to fairly present the Company’s quarterly financial results. The summarized quarterly data for the three months ended December 31, 2018 and years ended September 30, 2018 and 2017 are as follows: December 31, 2017 March 31, 2018 June 30, 2018 September 30, 2018 December 31, 2018 (in thousands) Revenue $ 3,992 $ 3,041 $ 3,284 $ 2,420 $ 6,654 Operating loss (58,548 ) (68,242 ) (81,406 ) (80,607 ) (73,344 ) Net loss attributable to ordinary shareholders (61,816 ) (69,461 ) (84,011 ) (79,879 ) (71,906 ) Net loss per ordinary share, basic and diluted (0.20 ) (0.20 ) (0.25 ) (0.23 ) (0.20 ) Weighted average shares outstanding, basic and diluted 313,730 340,252 340,457 341,302 366,458 December 31, 2016 March 31, 2017 June 30, 2017 September 30, 2017 (in thousands) Revenue $ 2,034 $ 1,381 $ 2,764 $ 2,450 Operating loss (35,801 ) (38,923 ) (43,023 ) (48,414 ) Net loss attributable to ordinary shareholders (20,692 ) (43,266 ) (52,648 ) (53,853 ) Net loss per ordinary share, basic and diluted (0.07 ) (0.14 ) (0.17 ) (0.18 ) Weighted average shares outstanding, basic and diluted 305,216 305,818 306,011 306,263 |
Transition Period
Transition Period | 3 Months Ended |
Dec. 31, 2018 | |
Transition Period [Abstract] | |
Transition Period | Note 12: Transition Period The Company is presenting audited financial statements for the three months ended December 31, 2018. The following tables provide certain unaudited comparative financial information for the same period of the prior year. Three Months Ended December 31, 2018 2017 (in thousands, except share and per share amounts) Revenues Product net sales $ 6,617 $ 2,220 Other revenue 37 1,772 Total revenues 6,654 3,992 Operating expenses Cost of product sales 1,829 1,171 Research and development 29,086 36,195 Selling, general and administrative 49,083 25,174 Total operating expenses 79,998 62,540 Loss from operations (73,344 ) (58,548 ) Interest income 2,449 604 Interest expense (295 ) (314 ) Foreign exchange (loss) gain (982 ) 160 Loss before income taxes (72,172 ) (58,098 ) Income tax (benefit) expense (266 ) 3,718 Net loss $ (71,906 ) $ (61,816 ) Net loss per common share, basic and diluted $ (0.20 ) $ (0.20 ) Weighted average common shares outstanding, basic and diluted 366,458 313,730 Three Months Ended December 31, 2018 2017 (in thousands) Cash flows from operating activities Net loss $ (71,906 ) $ (61,816 ) Adjustments to reconcile net loss to net cash used in operating activities: Foreign exchange loss (gain) 742 (180 ) Stock-based compensation 9,683 5,592 Depreciation and amortization 2,534 2,163 Deferred income taxes (1,265 ) (1,152 ) Other — 8 Changes in operating assets and liabilities: Accounts receivable, net (2,125 ) (223 ) Inventory (14,460 ) 378 Prepaid expenses and other current assets (3,635 ) (516 ) Other assets (47 ) (166 ) Accounts payable (1,211 ) (1,802 ) Current tax liabilities 878 4,898 Accrued liabilities 5,942 3,004 Other current liabilities 93 (2,071 ) Long-term liabilities 317 325 Net cash used in operating activities (74,460 ) (51,558 ) Cash flows from investing activities Additions to property, plant and equipment (18,687 ) (7,748 ) Additions to capitalized software (63 ) (993 ) Proceeds from disposal of property, plant and equipment — — Net cash used in investing activities (18,750 ) (8,741 ) Cash flows from financing activities Proceeds from issuance of ordinary shares, net of issuance costs 324,638 297,932 Proceeds from exercise of stock options — 1 Payments on build-to-suit financing obligation — (26 ) Payments on capital leases (40 ) (39 ) Payments on landlord financing obligation (130 ) (125 ) Net cash provided by (used in) financing activities 324,468 297,743 Effect of exchange rate changes on cash 5,326 (371 ) Net increase (decrease) in cash and cash equivalents 236,584 237,073 Cash and cash equivalents at beginning of period 354,913 322,154 Cash and cash equivalents at end of period $ 591,497 $ 559,227 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. |
Change of Fiscal Year | Change of Fiscal Year We have changed our fiscal year end to December 31 from September 30. This transition report is for the three-month period of October 1, 2018 through December 31, 2018, which we refer to as the transition period. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. |
Foreign Currency Translation | Foreign Currency Translation The financial position and results of operations of the Company’s non-U.S. subsidiaries are generally determined using local currency as the functional currency. Assets and liabilities of these subsidiaries are translated at the exchange rate in effect at each year end. Income statement accounts are translated at the average rate of exchange prevailing during the year. Adjustments arising from the use of differing exchange rates from period to period are included in accumulated other comprehensive loss in stockholders’ equity. Foreign currency transaction gains and losses are included in “foreign exchange (loss) gain” in the Company’s consolidated statements of operations. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity date of three months or less to be cash equivalents. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying values of the Company’s financial instruments, consisting of cash and cash equivalents, trade receivables, interest and other receivables, and accounts payable and accrued liabilities, approximate fair value due to the relative short-term nature of these instruments. |
Accounts Receivable | Accounts Receivable Accounts receivable are recorded net of customer allowances for prompt payment discounts, chargebacks, and doubtful accounts. Allowances for prompt payment discounts and chargebacks are based on contractual terms. The Company estimates the allowance for doubtful accounts based on existing contractual payment terms, actual payment patterns of its customers and individual customer circumstances. As of December 31, 2018, September 30, 2018 and September 30, 2017, the Company determined that an allowance for doubtful accounts was not required and no accounts were written off during the periods presented. |
Inventory | Inventory Inventory is stated at the lower of cost or estimated net realizable value. The Company uses a combination of standard and actual costing methodologies to determine the cost basis for its inventories which approximates actual cost. Inventory is valued on a first-in, first-out basis. The Company reduces its inventory to net realizable value for potentially excess, dated or obsolete inventory based on an analysis of forecasted demand compared to quantities on hand, as well as product shelf life. The Company capitalizes inventory costs associated with its products upon regulatory approval when, based on management’s judgment, future commercialization is considered probable and the future economic benefit is expected to be realized; otherwise, such costs are expensed. Prior to FDA approval of Epidiolex, all costs related to the manufacturing of Epidiolex were charged to research and development expense in the period incurred. |
Property, Plant, and Equipment | Property, Plant, and Equipment Property, plant, and equipment are recorded at cost and depreciated over their estimated useful lives using the straight-line method. Leasehold improvements are amortized over the shorter of their estimated useful lives or the term of the lease by use of the straight-line method. The estimated useful lives for buildings and leasehold improvements range from 4 to 20 years. The estimated useful lives of machinery and equipment range from 3 to 20 years. Construction-in-process reflects amounts incurred for property, equipment or improvements that have not been placed in service. Maintenance and repair costs are expensed as incurred. When assets are retired or sold, the assets and accumulated depreciation are removed from the respective accounts and any gain or loss is recognized. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability is measured by a comparison of the carrying amount of an asset to estimated future operating cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. |
Goodwill | Goodwill Goodwill represents the excess of purchase price over fair value of net assets acquired in a business combination and is not amortized. Goodwill is subject to impairment testing at least annually or when a triggering event occurs that could indicate a potential impairment. We performed the annual assessment for goodwill impairment in October of 2018, noting no impairment |
Revenue Recognition | Revenue Recognition The Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of Accounting Standards Codification 606, Revenue from Contracts with Customers Revenue for the Company’s product sales has not been adjusted for the effects of a financing component as the Company expects, at contract inception, that the period between when the Company’s transfers control of the product and when the Company receives payment will be one year or less. Product shipping and handling costs are included in cost of sales. |
Product Net Sales | Epidiolex Product Net Sales Epidiolex was approved by the United States Food and Drug Administration (“FDA”) in June 2018. Subsequent to the approval by the FDA, the United States Drug Enforcement Agency (“DEA”) took action to change the classification of Epidiolex from a Schedule I controlled substance to Schedule V controlled substance, thereby allowing Epidiolex prescribed and distributed in the United States. On November 1, 2018, the Company launched sales of Epidiolex to specialty pharmacies (“SPs”) and specialty distributors (“SDs”). The Company recognizes revenue from product sales upon receipt of product at the SPs and SDs, the date at which the control is transferred, net of the following allowances and reflects each of these as either a reduction to the related account receivable or as an accrued liability, depending on how the allowance is settled: Distribution Fees : Distribution fees include distribution service fees paid to the SPs and SDs based on a contractually fixed percentage of the wholesale acquisition cost (“WAC”), fees for data, and prompt payment discounts. Distribution fees are recorded as an offset to revenue based on contractual terms at the time revenue from the sale is recognized. Rebates : Allowances for rebates include mandated discounts under the Medicaid Drug Rebate Program and the Medicare Part D prescription drug benefit. Rebates are amounts owed after the final dispensing of the product to a benefit plan participant and are based upon contractual agreements with, or statutory requirements pertaining to, Medicaid and Medicare benefit providers. The allowance for rebates is based on statutory discount rates and expected utilization. The Company’s estimates for expected utilization of rebates is based on utilization data received from the SPs since product launch. Rebates are generally invoiced and paid in arrears so that the accrual balance consists of an estimate of the amount expected to be incurred for the current quarter’s activity, plus an accrual balance for prior quarters’ unpaid rebates. If actual future rebates vary from estimates, the Company may need to adjust prior period accruals, which would affect revenue in the period of adjustment. Chargebacks : Chargebacks are discounts and fees that relate to contracts with government and other entities purchasing from the SDs at a discounted price. The SDs charge back to the Company the difference between the price initially paid by the SDs and the discounted price paid to the SDs by these entities. The Company also incurs group purchasing organization fees for transactions through certain purchasing organizations. The Company estimates sales with these entities and accrues for anticipated chargebacks and organization fees, based on the applicable contractual terms. If actual future chargebacks vary from these estimates, the Company may need to adjust prior period accruals, which would affect revenue in the period of adjustment. Co-Payment Assistance : The Company offers co-payment assistance to commercially insured patients meeting certain eligibility requirements. Co-payment assistance is accrued for based on actual program participation and estimates of program redemption using data provided by third-party administrators. Product Returns : Consistent with industry practice, the Company offers the SPs and SDs limited product return rights for damages, shipment errors, and expiring product; provided that the return is within a specified period around the product expiration date as set forth in the applicable individual distribution agreement. The Company does not allow product returns for product that has been dispensed to a patient. As the Company receives inventory reports from the SPs and SDs and has the ability to control the amount of product that is sold to the SPs and SDs, it is able to make a reasonable estimate of future potential product returns based on this on-hand channel inventory data and sell-through data obtained from the SPs and SDs. In arriving at its estimate, the Company also considers historical product returns, the underlying product demand, and industry data specific to the specialty pharmaceutical distribution industry. Sativex Product Net Sales Sales of Sativex, which is currently being commercialized for spasticity due to multiple sclerosis (“MS”) outside the United States, are made pursuant to license agreements with commercial partners |
Other Revenue | Other Revenue The Company’s other revenue primarily consists of research and development fee revenue for research and development services provided under a collaboration agreement with Otsuka Pharmaceutical Co. Ltd (“Otsuka”) The research and development fee revenue is recognized at the time the underlying services are performed. The Sativex license agreements contain provisions for the Company to earn variable consideration in the form of regulatory milestone payments, sales-based milestone payments, and royalty payments. The Company has no further performance obligations related to the regulatory milestone payments and these amounts are recognized in accordance with Topic 606 when receipt of these payments becomes probable and there is no significant risk of revenue reversal. Revenue related to the sales-based milestone payments and product royalty payments are subject to the sales-based royalty exception under Topic 606 and will be recognized when the underlying sales are made. |
Research and Development Expenses | Research and Development Expenses Research and development expenses are charged to operations as incurred. Research and development expenses include, among other things, internal and external costs associated with preclinical development, pre-commercialization manufacturing expenses, and clinical trials. The Company accrues for costs incurred as the services are being provided by monitoring the status of the trial or services provided and the invoices received from its external service providers. In the case of clinical trials, a portion of the estimated cost normally relates to the projected cost to treat a patient in the trials, and this cost is recognized based on the number of patients enrolled in the trial. As actual costs become known, the Company adjusts its accruals accordingly. Research and development expense is presented net of reimbursements from reimbursable tax and expenditure credits from the U.K. government. Prior to September 30, 2017, the Company benefited from the U.K. Small and Medium-sized Enterprise R&D Tax Credit scheme, under which companies are able to obtain a refundable credit of up to 33.4% of eligible research and development expenses incurred by U.K. domiciled entities. Due to the increase in the size of the Company’s employee workforce in the U.K. and annual net revenues, beginning October 1, 2017 the Company is subject to the U.K. R&D Expenditure Credit scheme, available to larger companies, which has a significantly lower credit than the SME scheme. The majority of the Company’s pipeline research, clinical trials management and the Epidiolex and Sativex chemistry and manufacturing controls development activities, which are generally carried out by a subsidiary in the U.K., are eligible for inclusion under the U.K tax and expenditure rebate schemes. For the three months ended December 31, 2018 and years ended September 30, 2018, 2017 and 2016, the Company recorded $0.8 million, $4.3 million, $26.0 million and $30.5 million, respectively, of U.K. tax and expenditure rebates as a component of research and development expense. |
Concentration Risk | Concentration Risk Financial instruments, which potentially subject the Company to concentrations of credit risk, principally consist of cash, cash equivalents, investment securities, and accounts receivable. The Company’s cash and cash equivalents balances are primarily in depository accounts at major financial institutions in accordance with the Company’s investment policy. The Company’s investment policy defines allowable investments and establishes guidelines relating to credit quality, diversification, and maturities of its investments to preserve principal and maintain liquidity. Further, the Company specifies credit quality standards for its customers that are designed to limit the Company’s credit exposure to any single party. For the three months ended December 31, 2018, the Company’s five largest customers represented approximately 71% of the Company’s product net sales and 75% of the Company’s accounts receivable balance as of December 31, 2018. For the years ended September 30, 2018, 2017 and 2016, product net sales consisted entirely of Sativex sales outside of the United States pursuant to license agreements with a small number of commercial partners. |
Stock-based Compensation | Share-based Compensation The Company recognizes share-based compensation expense for grants of stock options under the Company's Long-Term Incentive Plans to employees and non-employee members of the Company's board of directors based on the grant-date fair value of those awards. The grant-date fair value of an award is generally recognized as compensation expense over the award's requisite service period. Expense related to awards with graded vesting is generally recognized over the vesting period using the accelerated attribution method. The Company uses the Black-Scholes model to compute the estimated fair value of stock option awards. Using this model, fair value is calculated based on assumptions with respect to (i) expected volatility of the Company's ADS price, (ii) the periods of time over which employees and members of the board of directors are expected to hold their options prior to exercise (expected lives), (iii) expected dividend yield on the ordinary shares, and (iv) risk-free interest rates. Share-based compensation expense also includes an estimate, which is made at the time of grant, of the number of awards that are expected to be forfeited. This estimate is revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. |
Income Taxes | Income Taxes The Company recognizes deferred tax assets and liabilities for temporary differences between the financial reporting basis and the tax basis of the Company's assets and liabilities along with net operating loss and tax credit carryovers. The Company records a valuation allowance against its deferred tax assets to reduce the net carrying value to an amount that it believes is more likely than not to be realized. When the Company establishes or reduces the valuation allowance against its deferred tax assets, its provision for income taxes will increase or decrease, respectively, in the period such determination is made. Valuation allowances against the Company’s deferred tax assets were $101.6 million, $97.5 million and $46.1 million at December 31, 2018, September 30, 2018 and September 30, 2017, respectively. Changes in the valuation allowances are generally recognized in the provision for income taxes as a component of the estimated annual effective tax rate. Uncertain tax positions, for which management's assessment is that there is more than a 50% probability of sustaining the position upon challenge by a taxing authority based upon its technical merits, are subjected to certain recognition and measurement criteria. The Company re-evaluates uncertain tax positions and considers various factors, including, but not limited to, changes in tax law, the measurement of tax positions taken or expected to be taken in tax returns, and changes in facts or circumstances related to a tax position. The Company adjusts the level of the liability to reflect any subsequent changes in the relevant facts and circumstances surrounding the uncertain positions. The Company recognizes interest and penalties related to income tax matters in income tax expense. |
Net Loss Per Share | Net Loss Per Share Basic net loss per share is calculated by dividing the net loss by the weighted average number of common shares outstanding for the period, without consideration for common stock equivalents. Diluted net loss per share is computed by dividing the net loss by the weighted average number of common shares and common stock equivalents outstanding for the period determined using the treasury stock method. For purposes of this calculation, market-priced stock options are considered to be common stock equivalents but are not included in the calculations of diluted net loss per share for the periods presented as their effect would be anti-dilutive. Nominal strike-price options are considered common stock equivalents and are included in the calculation of basic weighted average shares outstanding once they have become vested. The Company incurred net losses for all periods presented and there were no reconciling items for potentially dilutive securities. More specifically, at December 31, 2018, and September 30, 2018, 2017 and 2016, options totaling approximately |
Segment and Geographic Reporting | Segment and Geographic Reporting Management has determined that the Company operates in one business segment which is the discovery, development and commercialization of novel therapeutics from its proprietary cannabinoid product platform in a broad range of disease areas. Revenues recorded in the three months ended December 31, 2018 and years ended September 30, 2018, 2017 and 2016 were generated in the following geographical areas: Three Months Ended December 31, Years Ended September 30, 2018 2018 2017 2016 (in thousands) Europe $ 1,131 $ 6,882 $ 5,447 $ 5,021 United Kingdom 220 1,761 1,758 1,363 United States 4,669 1,560 121 4,917 Canada 347 1,031 743 955 Asia / Other 287 1,503 560 474 Total revenues $ 6,654 $ 12,737 $ 8,629 $ 12,730 Long-lived assets which include property, plant, and equipment were located as follows: December 31, September 30, 2018 2018 2017 (in thousands) United Kingdom $ 89,550 $ 81,405 $ 62,344 United States 1,282 976 831 Total long-lived assets $ 90,832 $ 82,381 $ 63,175 |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In February 2016, the FASB issued ASU 2016-02, Leases , which requires a lessee to recognize a lease liability and a right-of-use asset for all leases with lease terms of more than 12 months and requires disclosure of key information about leasing arrangements. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The classification criteria for distinguishing between operating and finance (previously capital) leases are substantially similar to the previous lease guidance, but with no explicit bright lines. ASU No. 2016-02 became effective for the Company as of January 1, 2019. The Company elected the transition method that allows it to apply the standard as of the adoption date and record a cumulative adjustment in retained earnings, if applicable. The Company has also elected the package of practical expedients permitted under the transition guidance, which among other things, allows the Company to carryforward the historical lease classification. The new standard also provides practical expedients for an entity’s ongoing accounting. The Company has made an accounting policy election to keep leases with an initial term of 12 months or less off of the balance sheet and recognize those lease payments in the consolidated statements of operations on a straight-line basis over the lease term. The Company has also elected the practical expedient to not separate lease and non-lease components for all of its leases as the non-lease components are not significant to the overall lease costs. While the Company is still finalizing the adoption procedures, the Company estimates that the adoption of this standard will result in recognition of additional lease assets and lease liabilities on its consolidated balance sheet as of January 1, 2019 of approximately $13.0 million to $17.0 million. Additionally, the Company’s build-to-suit financing obligation will be classified as a finance lease liability. The Company does not believe the adoption of ASU No. 2016-02 will materially affect its consolidated net loss or liquidity. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Revenues by Geographic Areas | Revenues recorded in the three months ended December 31, 2018 and years ended September 30, 2018, 2017 and 2016 were generated in the following geographical areas: Three Months Ended December 31, Years Ended September 30, 2018 2018 2017 2016 (in thousands) Europe $ 1,131 $ 6,882 $ 5,447 $ 5,021 United Kingdom 220 1,761 1,758 1,363 United States 4,669 1,560 121 4,917 Canada 347 1,031 743 955 Asia / Other 287 1,503 560 474 Total revenues $ 6,654 $ 12,737 $ 8,629 $ 12,730 |
Long-lived Assets Includes Property Plant and Equipment | Long-lived assets which include property, plant, and equipment were located as follows: December 31, September 30, 2018 2018 2017 (in thousands) United Kingdom $ 89,550 $ 81,405 $ 62,344 United States 1,282 976 831 Total long-lived assets $ 90,832 $ 82,381 $ 63,175 |
Composition of Certain Balanc_2
Composition of Certain Balance Sheet Captions (Tables) | 3 Months Ended |
Dec. 31, 2018 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Schedule of Inventory | Inventory consisted of the following: December 31, September 30, 2018 2018 2017 (in thousands) Raw materials $ 676 $ 506 $ 267 Work in process 28,709 17,529 4,513 Finished goods 3,645 1,026 889 $ 33,030 $ 19,061 $ 5,669 |
Schedule of Property, Plant and Equipment, Net | Property, plant and equipment, net, consisted of the following: December 31, September 30, 2018 2018 2017 (in thousands) Build-to-suit property 4,573 4,694 4,812 Machinery and equipment 32,598 33,303 28,431 Leasehold improvements 36,004 36,091 36,063 Office and IT equipment 2,481 2,109 2,108 Construction-in-process 44,546 34,165 12,319 120,202 110,362 83,733 Accumulated depreciation (29,370 ) (27,981 ) (20,558 ) $ 90,832 $ 82,381 $ 63,175 |
Schedule of Accrued Liabilities | Accrued liabilities consisted of the following: December 31, September 30, 2018 2018 2017 (in thousands) Accrued compensation and benefits $ 18,482 $ 15,578 6,749 Accrued vendor fees 11,452 12,773 8,983 Clinical trial accruals 10,059 8,487 6,687 Accrued growing fees 2,717 2,890 2,274 Accrued sales rebates and discounts 628 - - Other 9,139 7,011 8,963 $ 52,477 $ 46,739 $ 33,656 |
Schedule of Other Liabilities | Other liabilities consisted of the following: December 31, September 30, 2018 2018 2017 (in thousands) Landlord financing obligation $ 9,434 $ 10,368 $ 10,629 Other 648 426 209 $ 10,082 $ 10,794 $ 10,838 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 3 Months Ended |
Dec. 31, 2018 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Nominal Strike Price Stock Option Activity | The following table summarizes the Company’s nominal strike price stock option activity: Three Months Ended Years Ended December 31, September 30, 2018 2018 2017 2016 Nominal Strike Price Options Weighted Average Grant Date Fair Value Nominal Strike Price Options Weighted Average Grant Date Fair Value Nominal Strike Price Options Weighted Average Grant Date Fair Value Nominal Strike Price Options Weighted Average Grant Date Fair Value (in thousands, except weighted average grant date fair value) Outstanding, beginning of period 11,240 $ 8.41 9,752 $ 7.90 9,182 $ 5.16 7,334 $ 6.61 Granted 184 9.58 4,247 9.34 3,097 9.66 3,750 4.38 Exercised (150 ) 7.36 (2,617 ) 7.21 (2,239 ) 3.21 (1,610 ) 2.05 Cancelled (92 ) 8.61 (142 ) 9.37 (288 ) 6.69 (292 ) 4.07 Outstanding, end of period 11,182 $ 8.44 11,240 $ 8.41 9,752 $ 7.90 9,182 $ 5.16 Exercisable, end of period 1,054 $ 3.65 1,136 $ 6.11 1,986 $ 4.52 3,058 $ 2.60 |
Summary of Market Priced Stock Option Activity | The following table summarizes the Company’s market-priced stock option activity: Three Months Ended Years Ended December 31, September 30, 2018 2018 2017 2016 Market Strike Price Options Weighted Average Exercise Price Market Strike Price Options Weighted Average Exercise Price Market Strike Price Options Weighted Average Exercise Price Market Strike Price Options Weighted Average Exercise Price (in thousands, except weighted average grant date fair value) Outstanding, beginning of period 2,889 $ 8.49 2,174 $ 8.28 1,452 $ 5.80 1,098 $ 7.89 Granted — — 785 9.65 830 9.62 1,017 4.09 Exercised — — (70 ) 9.03 (108 ) 1.15 (663 ) 1.50 Outstanding, end of period 2,889 $ 8.49 2,889 $ 8.49 2,174 $ 8.28 1,452 $ 5.80 Exercisable, end of period 461 $ 6.90 257 $ 8.74 — — 107 $ 1.17 |
Summary of Stock Options Granted Valued with Weighted-Average Assumptions | Stock options granted during the three months ended December 31, 2018 and the years ended September 30, 2018, 2017 and 2016 were valued using the Black-Scholes option-pricing model with the following weighted-average assumptions: Three Months Ended December 31, Years Ended September 30, 2018 2018 2017 2016 Expected volatility 58 % 63 % 69 % 58 % Risk-free interest rate 2.70 % 2.30 % 1.93 % 1.30 % Expected dividend yield 0 % 0 % 0 % 0 % Expected life of options in years 6.50 6.50 6.50 5.85 |
Summary of Share-based Compensation Expense Included in Statements of Operations | The table below summarizes the total share-based compensation expense included in the Company’s statements of operations for the periods presented (in thousands): Three Months Ended December 31, Years Ended September 30, 2018 2018 2017 2016 Research and development $ 6,887 $ 9,385 $ 5,239 $ 6,586 Sales, general and administrative 2,382 22,242 10,240 6,075 $ 9,269 $ 31,627 $ 15,479 $ 12,661 |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Summary of Income (Loss) Before Income Taxes | Income (loss) before income taxes is as follows: Three Months Ended December 31, Years Ended September 30, 2018 2018 2017 2016 (in thousands) United States $ 1,487 $ 12,041 $ 3,725 $ 2,030 United Kingdom (73,659 ) (303,411 ) (175,216 ) (94,419 ) $ (72,172 ) $ (291,370 ) $ (171,491 ) $ (92,389 ) |
Components of Income Tax (Benefit) Expense | The components of income tax (benefit) expense are as follows: Three Months Ended December 31, Years Ended September 30, 2018 2018 2017 2016 (in thousands) Current U.S. federal $ 945 $ 3,885 $ 2,676 $ 1,534 U.S. state and local 54 229 62 116 United Kingdom — — — — Total Current $ 999 $ 4,114 $ 2,738 $ 1,650 Deferred U.S. federal $ (1,166 ) $ (263 ) $ (3,685 ) $ (2,178 ) U.S. state and local (99 ) (54 ) (85 ) (165 ) United Kingdom — — — — Total Deferred $ (1,265 ) $ (317 ) $ (3,770 ) $ (2,343 ) Total income tax (benefit) expense $ (266 ) $ 3,797 $ (1,032 ) $ (693 ) |
Significant Components of Deferred Tax Assets and Liabilities | As of December 31, 2018, September 30, 2018, and September 30, 2017, respectively, the tax effects of temporary differences and carryforwards that give rise to deferred tax assets and liabilities were as follows: Three Months Ended December 31, Years Ended September 30, 2018 2018 2017 (in thousands) Deferred tax assets: Net operating losses $ 94,999 $ 94,570 $ 46,379 Research and development tax credits 180 180 506 Share-based compensation 10,057 8,745 7,496 Accrued expenses 2,275 2,320 1,787 Capitalized costs 3,219 — — Other 825 291 199 Total gross deferred tax assets, net of valuation allowance 111,555 106,106 56,367 Valuation allowance (101,606 ) (97,462 ) (46,126 ) 9,949 8,644 10,241 Deferred tax liabilities: Depreciation $ (1,229 ) $ (1,310 ) $ (2,220 ) Deferred revenue — — (1,216 ) Total gross deferred tax liabilities (1,229 ) (1,310 ) (3,436 ) Net of deferred tax assets and liabilities $ 8,720 $ 7,334 $ 6,805 |
Reconciliation of Effective Tax Rate | The following table reconciles the Company’s effective tax rate to the United Kingdom statutory rate: Three Months Ended December 31, Years Ended September 30, 2018 2018 2017 2016 Tax, computed at the UK statutory rate 19.0 % 19.0 % 19.5 % 20.0 % U.S. research tax credits, net 0.4 % 0.9 % 1.6 % 3.4 % Surrender of R&D expenditures for U.K. research tax credits, net 0.0 % (0.1 %) (5.7 %) (12.7 %) Foreign Derived Intangible Income 0.8 % — — — Share-based compensation 0.2 % 0.9 % 2.1 % 2.8 % Changes in valuation allowances (19.6 %) (20.5 %) (16.2 %) (10.5 %) Overseas profits taxed at different rates (0.1 %) (0.3 %) 0.0 % (0.7 %) Remeasurement of deferred taxes from 2017 Tax Act 0.0 % (1.0 %) 0.0 % 0.0 % Other (0.3 %) (0.2 %) (0.7 %) (1.6 %) Effective income tax rate 0.4 % (1.3 %) 0.6 % 0.7 % |
Reconciliation of Unrecognized Tax Benefits | The reconciliation of the beginning and ending amount of unrecognized tax benefits was as follows: Three Months Ended December 31, Years Ended September 30, 2018 2018 2017 2016 (in thousands) Balance, beginning of period $ 1,826 $ 1,134 $ 884 $ 182 Additions for tax positions related to current year 34 771 453 702 Additions for tax positions related to prior years 83 46 18 — Reduction for tax positions related to prior years — (125 ) (221 ) — Balance, end of period $ 1,943 $ 1,826 $ 1,134 $ 884 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Dec. 31, 2018 | |
Commitments And Contingencies Disclosure [Abstract] | |
Summary of Aggregate Future Minimum Rent Payments under Leases | The aggregate future minimum rent payments under leases in effect as of December 31, 2018, are as follows ( in thousands Lease agreements accounted for as: Capital Leases Operating Leases Build-to-Suit Financing Obligation Landlord Financing Total 2019 $ 223 $ 6,164 $ 603 $ 1,225 $ 8,215 2020 223 6,686 482 1,225 8,616 2021 223 5,436 482 1,225 7,366 2022 217 3,952 482 1,225 5,876 2023 213 2,598 482 1,225 4,518 Thereafter 824 11,011 5,872 8,787 26,494 Minimum lease commitments $ 1,923 $ 35,847 $ 8,403 $ 14,912 $ 61,085 |
Financial Statements and Supp_2
Financial Statements and Supplementary Data (Unaudited) (Tables) | 3 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Data [Abstract] | |
Summary of Quarterly Data | The summarized quarterly data for the three months ended December 31, 2018 and years ended September 30, 2018 and 2017 are as follows: December 31, 2017 March 31, 2018 June 30, 2018 September 30, 2018 December 31, 2018 (in thousands) Revenue $ 3,992 $ 3,041 $ 3,284 $ 2,420 $ 6,654 Operating loss (58,548 ) (68,242 ) (81,406 ) (80,607 ) (73,344 ) Net loss attributable to ordinary shareholders (61,816 ) (69,461 ) (84,011 ) (79,879 ) (71,906 ) Net loss per ordinary share, basic and diluted (0.20 ) (0.20 ) (0.25 ) (0.23 ) (0.20 ) Weighted average shares outstanding, basic and diluted 313,730 340,252 340,457 341,302 366,458 December 31, 2016 March 31, 2017 June 30, 2017 September 30, 2017 (in thousands) Revenue $ 2,034 $ 1,381 $ 2,764 $ 2,450 Operating loss (35,801 ) (38,923 ) (43,023 ) (48,414 ) Net loss attributable to ordinary shareholders (20,692 ) (43,266 ) (52,648 ) (53,853 ) Net loss per ordinary share, basic and diluted (0.07 ) (0.14 ) (0.17 ) (0.18 ) Weighted average shares outstanding, basic and diluted 305,216 305,818 306,011 306,263 |
Transition Period (Tables)
Transition Period (Tables) | 3 Months Ended |
Dec. 31, 2018 | |
Transition Period [Abstract] | |
Unaudited Comparative Financial Information Statements Of Operations | The following tables provide certain unaudited comparative financial information for the same period of the prior year. Three Months Ended December 31, 2018 2017 (in thousands, except share and per share amounts) Revenues Product net sales $ 6,617 $ 2,220 Other revenue 37 1,772 Total revenues 6,654 3,992 Operating expenses Cost of product sales 1,829 1,171 Research and development 29,086 36,195 Selling, general and administrative 49,083 25,174 Total operating expenses 79,998 62,540 Loss from operations (73,344 ) (58,548 ) Interest income 2,449 604 Interest expense (295 ) (314 ) Foreign exchange (loss) gain (982 ) 160 Loss before income taxes (72,172 ) (58,098 ) Income tax (benefit) expense (266 ) 3,718 Net loss $ (71,906 ) $ (61,816 ) Net loss per common share, basic and diluted $ (0.20 ) $ (0.20 ) Weighted average common shares outstanding, basic and diluted 366,458 313,730 |
Unaudited Comparative Financial Information Statements of Cash Flows | Three Months Ended December 31, 2018 2017 (in thousands) Cash flows from operating activities Net loss $ (71,906 ) $ (61,816 ) Adjustments to reconcile net loss to net cash used in operating activities: Foreign exchange loss (gain) 742 (180 ) Stock-based compensation 9,683 5,592 Depreciation and amortization 2,534 2,163 Deferred income taxes (1,265 ) (1,152 ) Other — 8 Changes in operating assets and liabilities: Accounts receivable, net (2,125 ) (223 ) Inventory (14,460 ) 378 Prepaid expenses and other current assets (3,635 ) (516 ) Other assets (47 ) (166 ) Accounts payable (1,211 ) (1,802 ) Current tax liabilities 878 4,898 Accrued liabilities 5,942 3,004 Other current liabilities 93 (2,071 ) Long-term liabilities 317 325 Net cash used in operating activities (74,460 ) (51,558 ) Cash flows from investing activities Additions to property, plant and equipment (18,687 ) (7,748 ) Additions to capitalized software (63 ) (993 ) Proceeds from disposal of property, plant and equipment — — Net cash used in investing activities (18,750 ) (8,741 ) Cash flows from financing activities Proceeds from issuance of ordinary shares, net of issuance costs 324,638 297,932 Proceeds from exercise of stock options — 1 Payments on build-to-suit financing obligation — (26 ) Payments on capital leases (40 ) (39 ) Payments on landlord financing obligation (130 ) (125 ) Net cash provided by (used in) financing activities 324,468 297,743 Effect of exchange rate changes on cash 5,326 (371 ) Net increase (decrease) in cash and cash equivalents 236,584 237,073 Cash and cash equivalents at beginning of period 354,913 322,154 Cash and cash equivalents at end of period $ 591,497 $ 559,227 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Details) shares in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Oct. 31, 2018USD ($) | Dec. 31, 2018USD ($)Segmentshares | Sep. 30, 2018USD ($)shares | Sep. 30, 2017USD ($)shares | Sep. 30, 2016USD ($)shares | Jan. 01, 2019USD ($) | |
Summary Of Significant Accounting Policies [Line Items] | ||||||
Accounts receivable written off | $ 0 | $ 0 | $ 0 | |||
Goodwill Impairment charges | $ 0 | |||||
Income tax expenditure rebates of research and developement expense | 800,000 | 4,300,000 | 26,000,000 | $ 30,500,000 | ||
Deferred tax assets, valuation allowance | $ 101,606,000 | $ 97,462,000 | $ 46,126,000 | |||
Number of business segment | Segment | 1 | |||||
Common Stock | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Antidilutive securities excluded from calculation of diluted net loss per share | shares | 13 | 13 | 9.9 | 7.6 | ||
Customer Concentration Risk | Product Net Sales | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Concentration risk, percentage | 71.00% | |||||
Customer Concentration Risk | Accounts Receivable | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Concentration risk, percentage | 75.00% | |||||
Topic 606 | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Performance obligations related to regulatory milestone payments | $ 0 | |||||
Minimum | ASU 2016-02 | Subsequent Event | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Additional lease assets | $ 13,000,000 | |||||
Additional lease liabilities | 13,000,000 | |||||
Maximum | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Percentage of research and development refundable credit | 33.40% | |||||
Maximum | ASU 2016-02 | Subsequent Event | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Additional lease assets | 17,000,000 | |||||
Additional lease liabilities | $ 17,000,000 | |||||
Buildings and Leasehold Improvements | Minimum | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Property, plant and equipment, useful life | 4 years | |||||
Buildings and Leasehold Improvements | Maximum | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Property, plant and equipment, useful life | 20 years | |||||
Machinery and Equipment | Minimum | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Property, plant and equipment, useful life | 3 years | |||||
Machinery and Equipment | Maximum | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Property, plant and equipment, useful life | 20 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Revenues by Geographical Areas (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Segment Reporting Information [Line Items] | |||||
Total revenues | $ 6,654 | $ 3,992 | $ 12,737 | $ 8,629 | $ 12,730 |
Europe | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | 1,131 | 6,882 | 5,447 | 5,021 | |
United Kingdom | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | 220 | 1,761 | 1,758 | 1,363 | |
United States | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | 4,669 | 1,560 | 121 | 4,917 | |
Canada | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | 347 | 1,031 | 743 | 955 | |
Asia / Other | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | $ 287 | $ 1,503 | $ 560 | $ 474 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Long-lived Assets Includes Property Plant and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 |
Segment Reporting Information [Line Items] | |||
Total long-lived assets | $ 90,832 | $ 82,381 | $ 63,175 |
United Kingdom | |||
Segment Reporting Information [Line Items] | |||
Total long-lived assets | 89,550 | 81,405 | 62,344 |
United States | |||
Segment Reporting Information [Line Items] | |||
Total long-lived assets | $ 1,282 | $ 976 | $ 831 |
Sativex License Agreements - Ad
Sativex License Agreements - Additional Information (Details) - Sativex License Agreements | Jan. 01, 2021 | Dec. 31, 2018USD ($)LicenseAgreement | Sep. 30, 2017USD ($) | Sep. 30, 2010 | Sep. 30, 2005USD ($) | Sep. 30, 2003USD ($) | Dec. 31, 2017USD ($) | Sep. 30, 2011USD ($) | Sep. 30, 2007USD ($) |
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||
Number of license agreements | LicenseAgreement | 6 | ||||||||
Contingent future milestone payment | $ 10,000,000 | ||||||||
Potential sale based milestone | 30,000,000 | ||||||||
Accrued milestones contingent payments | $ 0 | ||||||||
Otsuka Pharmaceutical Co. Ltd | United States | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||
Up-front payment received | $ 18,000,000 | ||||||||
Milestone payment received | $ 4,000,000 | ||||||||
Potential additional regulatory and clinical milestones payment receivable | $ 0 | ||||||||
Bayer Healthcare AG | United Kingdom and Canada | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||
Up-front payment received | $ 8,200,000 | ||||||||
Milestone payment received | 24,200,000 | ||||||||
Potential future contingent regulatory milestone payments receivable | $ 11,700,000 | ||||||||
Bayer Healthcare AG | United Kingdom and Canada | Revenue from Contract with Customer | Revenue from License Rights Concentration Risk | Minimum | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||
Revenue percentage in-market | 15.00% | ||||||||
Bayer Healthcare AG | United Kingdom and Canada | Revenue from Contract with Customer | Revenue from License Rights Concentration Risk | Maximum | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||
Revenue percentage in-market | 40.00% | ||||||||
Almirall S.A. | Europe | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||
Up-front payment received | $ 21,500,000 | ||||||||
Milestone payment received | 32,500,000 | ||||||||
Potential additional regulatory and clinical milestones payment receivable | 5,200,000 | ||||||||
Potential contingent regulatory and commercial milestone payments | 54,600,000 | ||||||||
Potential additional sales-based milestones payment receivable | $ 16,900,000 | ||||||||
Almirall S.A. | Europe | Revenue from Contract with Customer | Revenue from License Rights Concentration Risk | Scenario Forecast | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||
Revenue percentage in-market | 15.00% | ||||||||
Almirall S.A. | Europe | Revenue from Contract with Customer | Revenue from License Rights Concentration Risk | Maximum | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||
Revenue percentage in-market | 10.00% | ||||||||
Novartis Pharma AG | Latin America, Asia, the Middle East and Africa | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||
Up-front payment received | $ 5,000,000 | ||||||||
Neopharm Group | Latin America, Asia, the Middle East and Africa | Revenue from Contract with Customer | Revenue from License Rights Concentration Risk | Minimum | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||
Revenue percentage in-market | 40.00% | ||||||||
Neopharm Group | Latin America, Asia, the Middle East and Africa | Revenue from Contract with Customer | Revenue from License Rights Concentration Risk | Maximum | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||
Revenue percentage in-market | 50.00% |
Composition of Certain Balanc_3
Composition of Certain Balance Sheet Captions - Schedule of Inventory (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 |
Inventory Disclosure [Abstract] | |||
Raw materials | $ 676 | $ 506 | $ 267 |
Work in process | 28,709 | 17,529 | 4,513 |
Finished goods | 3,645 | 1,026 | 889 |
Inventory | $ 33,030 | $ 19,061 | $ 5,669 |
Composition of Certain Balanc_4
Composition of Certain Balance Sheet Captions - Schedule of Property, Plant and Equipment, Net (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 |
Property Plant And Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 120,202 | $ 110,362 | $ 83,733 |
Accumulated depreciation | (29,370) | (27,981) | (20,558) |
Property, plant and equipment, net | 90,832 | 82,381 | 63,175 |
Build-to-Suit Property | |||
Property Plant And Equipment [Line Items] | |||
Property, plant and equipment, gross | 4,573 | 4,694 | 4,812 |
Machinery and Equipment | |||
Property Plant And Equipment [Line Items] | |||
Property, plant and equipment, gross | 32,598 | 33,303 | 28,431 |
Leasehold Improvements | |||
Property Plant And Equipment [Line Items] | |||
Property, plant and equipment, gross | 36,004 | 36,091 | 36,063 |
Office and IT Equipment | |||
Property Plant And Equipment [Line Items] | |||
Property, plant and equipment, gross | 2,481 | 2,109 | 2,108 |
Construction-in-Process | |||
Property Plant And Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 44,546 | $ 34,165 | $ 12,319 |
Composition of Certain Balanc_5
Composition of Certain Balance Sheet Captions - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | ||||
Depreciation of property and equipment | $ 2.2 | $ 8.5 | $ 7 | $ 5.1 |
Retired fully depreciated property, plant and equipment | $ 0 | $ 0.5 | $ 1.8 | $ 1.4 |
Composition of Certain Balanc_6
Composition of Certain Balance Sheet Captions - Schedule of Accrued Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 |
Payables And Accruals [Abstract] | |||
Accrued compensation and benefits | $ 18,482 | $ 15,578 | $ 6,749 |
Accrued vendor fees | 11,452 | 12,773 | 8,983 |
Clinical trial accruals | 10,059 | 8,487 | 6,687 |
Accrued growing fees | 2,717 | 2,890 | 2,274 |
Accrued sales rebates and discounts | 628 | ||
Other | 9,139 | 7,011 | 8,963 |
Accrued liabilities | $ 52,477 | $ 46,739 | $ 33,656 |
Composition of Certain Balanc_7
Composition of Certain Balance Sheet Captions - Schedule of Other Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 |
Other Liabilities Disclosure [Abstract] | |||
Landlord financing obligation | $ 9,434 | $ 10,368 | $ 10,629 |
Other | 648 | 426 | 209 |
Other liabilities | $ 10,082 | $ 10,794 | $ 10,838 |
Stockholder's Equity - Addition
Stockholder's Equity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Oct. 31, 2018 | Dec. 31, 2017 | Jul. 31, 2016 | Dec. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2016 | |
Class Of Stock [Line Items] | ||||||
ADS price per share | $ 158 | $ 115 | $ 90 | |||
Proceeds from issuance of shares | $ 324.6 | $ 297.9 | $ 273.8 | |||
American Depositary Shares ("ADSs") | ||||||
Class Of Stock [Line Items] | ||||||
Shares issued | 2,185,000 | 2,760,000 | 3,220,000 | |||
Common Stock | ||||||
Class Of Stock [Line Items] | ||||||
Shares issued | 26,220,000 | 33,120,000 | 38,640,000 | 26,220,000 | 33,120,000 | 38,640,000 |
Share-Based Compensation - Addi
Share-Based Compensation - Additional Information (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Sep. 30, 2018USD ($)shares | Sep. 30, 2017USD ($)shares | Sep. 30, 2016USD ($)$ / sharesshares | Dec. 31, 2018£ / shares | Sep. 30, 2018£ / shares | Sep. 30, 2018$ / shares | Sep. 30, 2017£ / shares | Sep. 30, 2017$ / shares | Mar. 14, 2017shares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||||
Number of shares issued | shares | 0 | 785,000 | 830,000 | 1,017,000 | |||||||
Exercise price | £ / shares | £ 0.001 | £ 0.001 | £ 0.001 | ||||||||
Aggregate intrinsic value stock option exercised | $ 1,600 | $ 30,700 | $ 22,900 | $ 13,100 | |||||||
Weighted average remaining contractual life of option outstanding | 5 years 1 month 6 days | ||||||||||
Weighted average remaining contractual life of option exercisable | 5 years 4 months 24 days | ||||||||||
Share price | $ / shares | $ 8.12 | $ 8.12 | |||||||||
Aggregate intrinsic value of options outstanding | $ 97,800 | $ 97,800 | |||||||||
Aggregate intrinsic value of options exercisable | 9,800 | $ 9,800 | |||||||||
Share based compensation expense | 9,269 | $ 31,627 | $ 15,479 | $ 12,661 | |||||||
Inventory | |||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||||
Share based compensation expense | $ 400 | ||||||||||
American Depositary Shares ("ADSs") | |||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||||
Share price | $ / shares | $ 97.39 | $ 97.39 | |||||||||
2017 LTIP Plan | |||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||||
Grant expiration date | Mar. 13, 2022 | ||||||||||
Number of shares issued | shares | 6,706,971 | ||||||||||
2017 LTIP Plan | Maximum | |||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||||
Number of shares authorized for issuance | shares | 15,000,000 | ||||||||||
2017 LTIP Plan | American Depositary Shares ("ADSs") | |||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||||
Number of shares authorized for issuance | shares | 1,250,000 | ||||||||||
Market Priced Options | |||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||||
Weighted average per share fair value of market priced options granted | $ / shares | $ 2.13 | $ 5.98 | $ 6 | ||||||||
Non-Vested Stock Options | |||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||||
Total compensation cost not yet recognized | $ 39,700 | $ 39,700 | |||||||||
Total compensation cost expected period of recognition | 38 months | ||||||||||
Total compensation cost weighted-average basis period | 11 months |
Share-Based Compensation - Summ
Share-Based Compensation - Summary of Nominal Strike Price Stock Option Activity (Details) - $ / shares shares in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||||
Nominal Strike Price Options, Outstanding, beginning of period | 11,240 | 9,752 | 9,182 | 7,334 |
Nominal Strike Price Options, Granted | 184 | 4,247 | 3,097 | 3,750 |
Nominal Strike Price Options, Exercised | (150) | (2,617) | (2,239) | (1,610) |
Nominal Strike Price Options, Cancelled | (92) | (142) | (288) | (292) |
Nominal Strike Price Options, Outstanding, end of period | 11,182 | 11,240 | 9,752 | 9,182 |
Nominal Strike Price Options, Exercisable, end of period | 1,054 | 1,136 | 1,986 | 3,058 |
Weighted Average Grant Date Fair Value, Outstanding, beginning of period | $ 8.41 | $ 7.90 | $ 5.16 | $ 6.61 |
Weighted Average Grant Date Fair Value, Granted | 9.58 | 9.34 | 9.66 | 4.38 |
Weighted Average Grant Date Fair Value, Exercised | 7.36 | 7.21 | 3.21 | 2.05 |
Weighted Average Grant Date Fair Value, Cancelled | 8.61 | 9.37 | 6.69 | 4.07 |
Weighted Average Grant Date Fair Value, Outstanding, end of period | 8.44 | 8.41 | 7.90 | 5.16 |
Weighted Average Grant Date Fair Value, Exercisable, end of period | $ 3.65 | $ 6.11 | $ 4.52 | $ 2.60 |
Share-Based Compensation - Su_2
Share-Based Compensation - Summary of Market Priced Stock Option Activity (Details) - $ / shares shares in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||||
Market Strike Price Options, Outstanding, beginning of period | 2,889 | 2,174 | 1,452 | 1,098 |
Market Strike Price Options, Granted | 0 | 785 | 830 | 1,017 |
Market Strike Price Options, Exercised | 0 | (70) | (108) | (663) |
Market Strike Price Options, Outstanding, end of period | 2,889 | 2,889 | 2,174 | 1,452 |
Market Strike Price Options, Exercisable, end of period | 461 | 257 | 107 | |
Weighted Average Exercise Price, Outstanding, beginning of period | $ 8.49 | $ 8.28 | $ 5.80 | $ 7.89 |
Weighted Average Exercise Price, Granted | 0 | 9.65 | 9.62 | 4.09 |
Weighted Average Exercise Price, Exercised | 0 | 9.03 | 1.15 | 1.50 |
Weighted Average Exercise Price, Outstanding, end of period | 8.49 | 8.49 | $ 8.28 | 5.80 |
Weighted Average Exercise Price, Exercisable, end of period | $ 6.90 | $ 8.74 | $ 1.17 |
Share-Based Compensation - Su_3
Share-Based Compensation - Summary of Stock Options Granted Valued with Weighted-Average Assumptions (Details) | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||||
Expected volatility | 58.00% | 63.00% | 69.00% | 58.00% |
Risk-free interest rate | 2.70% | 2.30% | 1.93% | 1.30% |
Expected dividend yield | 0.00% | 0.00% | 0.00% | 0.00% |
Expected life of options in years | 6 years 6 months | 6 years 6 months | 6 years 6 months | 5 years 10 months 6 days |
Share-Based Compensation - Su_4
Share-Based Compensation - Summary of Share-based Compensation Expense Included in Statements of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Total stock-based compensation expense | $ 9,269 | $ 31,627 | $ 15,479 | $ 12,661 |
Research and Development | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 6,887 | 9,385 | 5,239 | 6,586 |
Sales, General and Administrative | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Total stock-based compensation expense | $ 2,382 | $ 22,242 | $ 10,240 | $ 6,075 |
Retirement Plans - Additional I
Retirement Plans - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Defined Contribution Retirement Plan | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Employer discretionary contribution amount to retirement plans | $ 0.9 | $ 3.3 | $ 2.5 | $ 1.9 |
Income Taxes - Summary of Incom
Income Taxes - Summary of Income (Loss) Before Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | ||||
United States | $ 1,487 | $ 12,041 | $ 3,725 | $ 2,030 |
United Kingdom | (73,659) | (303,411) | (175,216) | (94,419) |
Income (loss) before income taxes | $ (72,172) | $ (291,370) | $ (171,491) | $ (92,389) |
Income Taxes - Components of In
Income Taxes - Components of Income Tax (Benefit) Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Current | |||||
U.S. federal | $ 945 | $ 3,885 | $ 2,676 | $ 1,534 | |
U.S. state and local | 54 | 229 | 62 | 116 | |
Total Current | 999 | 4,114 | 2,738 | 1,650 | |
Deferred | |||||
U.S. federal | (1,166) | (263) | (3,685) | (2,178) | |
U.S. state and local | (99) | (54) | (85) | (165) | |
Total Deferred | (1,265) | (317) | (3,770) | (2,343) | |
Total income tax (benefit) expense | $ (266) | $ 3,718 | $ 3,797 | $ (1,032) | $ (693) |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 |
Deferred tax assets: | |||
Net operating losses | $ 94,999 | $ 94,570 | $ 46,379 |
Research and development tax credits | 180 | 180 | 506 |
Share-based compensation | 10,057 | 8,745 | 7,496 |
Accrued expenses | 2,275 | 2,320 | 1,787 |
Capitalized costs | 3,219 | ||
Other | 825 | 291 | 199 |
Total gross deferred tax assets, net of valuation allowance | 111,555 | 106,106 | 56,367 |
Valuation allowance | (101,606) | (97,462) | (46,126) |
Total deferred tax assets, net of valuation allowance | 9,949 | 8,644 | 10,241 |
Deferred tax liabilities: | |||
Depreciation | (1,229) | (1,310) | (2,220) |
Deferred revenue | (1,216) | ||
Total gross deferred tax liabilities | (1,229) | (1,310) | (3,436) |
Net of deferred tax assets and liabilities | $ 8,720 | $ 7,334 | $ 6,805 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) $ in Thousands, £ in Millions | Apr. 01, 2020 | Dec. 22, 2017 | Apr. 01, 2017 | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2017 | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Dec. 31, 2018GBP (£) | Sep. 30, 2015USD ($) |
Income Taxes [Line Items] | ||||||||||
Deferred tax assets, valuation allowance | $ 101,606 | $ 97,462 | $ 46,126 | |||||||
Reduction in corporation tax rate | 21.00% | 35.00% | ||||||||
Tax cuts and jobs act, incomplete accounting, expense related to remeasurement of deferred tax assets and liabilities | $ 2,900 | |||||||||
Weighted-average corporate tax rate | 0.40% | (1.30%) | 0.60% | 0.70% | ||||||
Unrecognized Tax Benefits | $ 1,943 | $ 1,826 | $ 1,134 | $ 884 | $ 182 | |||||
Unrecognized tax benefits would impact effective tax rate, if recognized | $ 1,900 | |||||||||
U.S. Federal Tax Authorities | Tax Year 2017 [Member] | ||||||||||
Income Taxes [Line Items] | ||||||||||
Tax year under examination | 2,017 | |||||||||
U.S. Federal Tax Authorities | Tax Year 2016 [Member] | ||||||||||
Income Taxes [Line Items] | ||||||||||
Tax year under examination | 2,016 | |||||||||
U.S. Federal Tax Authorities | Tax Year 2015 [Member] | ||||||||||
Income Taxes [Line Items] | ||||||||||
Tax year under examination | 2,015 | |||||||||
State Authorities | Tax Year 2017 [Member] | ||||||||||
Income Taxes [Line Items] | ||||||||||
Tax year under examination | 2,017 | |||||||||
State Authorities | Tax Year 2016 [Member] | ||||||||||
Income Taxes [Line Items] | ||||||||||
Tax year under examination | 2,016 | |||||||||
State Authorities | Tax Year 2015 [Member] | ||||||||||
Income Taxes [Line Items] | ||||||||||
Tax year under examination | 2,015 | |||||||||
State Authorities | Tax Year 2014 [Member] | ||||||||||
Income Taxes [Line Items] | ||||||||||
Tax year under examination | 2,014 | |||||||||
United Kingdom | ||||||||||
Income Taxes [Line Items] | ||||||||||
Tax, computed at the UK statutory rate | 19.00% | 19.00% | 19.50% | 20.00% | ||||||
Tax rate used for measurement of deferred tax assets | 17.00% | |||||||||
Net operating loss carryforwards | $ 558,800 | |||||||||
Unsurrendered tax losses and tax credit carryforwards to be offset, restricted valuation | £ | £ 5 | |||||||||
Percentage of restriction in profits covered by losses above restricted valuation amount | 50.00% | 50.00% | ||||||||
United Kingdom | Scenario, Plan | ||||||||||
Income Taxes [Line Items] | ||||||||||
Tax, computed at the UK statutory rate | 17.00% | 19.00% | ||||||||
United States | ||||||||||
Income Taxes [Line Items] | ||||||||||
Weighted-average corporate tax rate | 21.00% | 24.50% | 35.00% | 35.00% | ||||||
Maximum | ||||||||||
Income Taxes [Line Items] | ||||||||||
Tax Cuts And Jobs Act 2017 Measurement Period From Enactment Date | 1 year |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Effective Tax Rate (Details) | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Investments Owned Federal Income Tax Note [Line Items] | ||||
Foreign Derived Intangible Income | 0.80% | |||
Share-based compensation | 0.20% | 0.90% | 2.10% | 2.80% |
Changes in valuation allowances | (19.60%) | (20.50%) | (16.20%) | (10.50%) |
Overseas profits taxed at different rates | (0.10%) | (0.30%) | 0.00% | (0.70%) |
Remeasurement of deferred taxes from 2017 Tax Act | 0.00% | (1.00%) | 0.00% | 0.00% |
Other | (0.30%) | (0.20%) | (0.70%) | (1.60%) |
Effective income tax rate | 0.40% | (1.30%) | 0.60% | 0.70% |
United States | ||||
Investments Owned Federal Income Tax Note [Line Items] | ||||
Research tax credits, net | 0.40% | 0.90% | 1.60% | 3.40% |
Effective income tax rate | 21.00% | 24.50% | 35.00% | 35.00% |
United Kingdom | ||||
Investments Owned Federal Income Tax Note [Line Items] | ||||
Tax, computed at the UK statutory rate | 19.00% | 19.00% | 19.50% | 20.00% |
Surrender of R&D expenditures for U.K. research tax credits, net | 0.00% | (0.10%) | (5.70%) | (12.70%) |
Income Taxes - Reconciliation_2
Income Taxes - Reconciliation of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | ||||
Balance, beginning of period | $ 1,826 | $ 1,134 | $ 884 | $ 182 |
Additions for tax positions related to current year | 34 | 771 | 453 | 702 |
Additions for tax positions related to prior years | 83 | 46 | 18 | |
Reduction for tax positions related to prior years | (125) | (221) | ||
Balance, end of period | $ 1,943 | $ 1,826 | $ 1,134 | $ 884 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
May 31, 2016 | Dec. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2013 | |
Commitments And Contingencies [Line Items] | ||||||
Lease expiry period | 2029-09 | |||||
Operating leases initial terms | 50 months | |||||
Rent expense under operating leases | $ 1,800,000 | $ 5,700,000 | $ 4,600,000 | $ 3,300,000 | ||
Build-to-suit financing obligation | 4,236,000 | 4,378,000 | 4,611,000 | $ 13,100,000 | ||
Build to suit financing obligation rent payments period | 15 years | |||||
Build to suit financing obligation effective interest rate | 7.00% | |||||
Build to suit financing, landlord financing obligation | 10,000,000 | $ 10,400,000 | $ 11,100,000 | |||
Letter of Credit | ||||||
Commitments And Contingencies [Line Items] | ||||||
Maximum borrowing capacity | $ 300,000 |
Commitments and Contingencies_2
Commitments and Contingencies - Summary of Aggregate Future Minimum Rent Payments under Leases (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Capital Leases | |
2,019 | $ 223 |
2,020 | 223 |
2,021 | 223 |
2,022 | 217 |
2,023 | 213 |
Thereafter | 824 |
Minimum lease commitments | 1,923 |
Operating Leases | |
2,019 | 6,164 |
2,020 | 6,686 |
2,021 | 5,436 |
2,022 | 3,952 |
2,023 | 2,598 |
Thereafter | 11,011 |
Minimum lease commitments | 35,847 |
Build-to-Suit Financing Obligation | |
2,019 | 603 |
2,020 | 482 |
2,021 | 482 |
2,022 | 482 |
2,023 | 482 |
Thereafter | 5,872 |
Minimum lease commitments | 8,403 |
Landlord Financing | |
2,019 | 1,225 |
2,020 | 1,225 |
2,021 | 1,225 |
2,022 | 1,225 |
2,023 | 1,225 |
Thereafter | 8,787 |
Minimum lease commitments | 14,912 |
Total | |
2,019 | 8,215 |
2,020 | 8,616 |
2,021 | 7,366 |
2,022 | 5,876 |
2,023 | 4,518 |
Thereafter | 26,494 |
Minimum lease commitments | $ 61,085 |
Financial Statements and Supp_3
Financial Statements and Supplementary Data (Unaudited) - Summary of Quarterly Data (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Quarterly Financial Data [Abstract] | ||||||||||||
Revenue | $ 6,654 | $ 2,420 | $ 3,284 | $ 3,041 | $ 3,992 | $ 2,450 | $ 2,764 | $ 1,381 | $ 2,034 | |||
Operating loss | (73,344) | (80,607) | (81,406) | (68,242) | (58,548) | (48,414) | (43,023) | (38,923) | (35,801) | $ (288,803) | $ (166,161) | $ (128,653) |
Net loss attributable to ordinary shareholders | $ (71,906) | $ (79,879) | $ (84,011) | $ (69,461) | $ (61,816) | $ (53,853) | $ (52,648) | $ (43,266) | $ (20,692) | $ (295,167) | $ (170,459) | $ (91,696) |
Net loss per common share, basic and diluted | $ (0.20) | $ (0.23) | $ (0.25) | $ (0.20) | $ (0.20) | $ (0.18) | $ (0.17) | $ (0.14) | $ (0.07) | $ (0.88) | $ (0.56) | $ (0.34) |
Weighted average common shares outstanding, basic and diluted | 366,458 | 341,302 | 340,457 | 340,252 | 313,730 | 306,263 | 306,011 | 305,818 | 305,216 | 333,936 | 305,826 | 272,165 |
Transition Period - Unaudited C
Transition Period - Unaudited Comparative Financial Information Statements Of Operations (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Revenues | ||||||||||||
Total revenues | $ 6,654 | $ 3,992 | $ 12,737 | $ 8,629 | $ 12,730 | |||||||
Operating expenses | ||||||||||||
Cost of product sales | 1,829 | 1,171 | 5,986 | 4,521 | 3,820 | |||||||
Research and development | 29,086 | 36,195 | 153,736 | 112,249 | 104,375 | |||||||
Selling, general and administrative | 49,083 | 25,174 | 141,818 | 58,020 | 33,188 | |||||||
Total operating expenses | 79,998 | 62,540 | 301,540 | 174,790 | 141,383 | |||||||
Loss from operations | (73,344) | $ (80,607) | $ (81,406) | $ (68,242) | (58,548) | $ (48,414) | $ (43,023) | $ (38,923) | $ (35,801) | (288,803) | (166,161) | (128,653) |
Interest income | 2,449 | 604 | 3,645 | 2,063 | 611 | |||||||
Interest expense | (295) | (314) | (1,249) | (951) | (244) | |||||||
Foreign exchange (loss) gain | (982) | 160 | (4,963) | (6,442) | 35,897 | |||||||
Loss before income taxes | (72,172) | (58,098) | (291,370) | (171,491) | (92,389) | |||||||
Income tax (benefit) expense | (266) | 3,718 | 3,797 | (1,032) | (693) | |||||||
Net loss | $ (71,906) | $ (79,879) | $ (84,011) | $ (69,461) | $ (61,816) | $ (53,853) | $ (52,648) | $ (43,266) | $ (20,692) | $ (295,167) | $ (170,459) | $ (91,696) |
Net loss per common share, basic and diluted | $ (0.20) | $ (0.23) | $ (0.25) | $ (0.20) | $ (0.20) | $ (0.18) | $ (0.17) | $ (0.14) | $ (0.07) | $ (0.88) | $ (0.56) | $ (0.34) |
Weighted average common shares outstanding, basic and diluted | 366,458 | 341,302 | 340,457 | 340,252 | 313,730 | 306,263 | 306,011 | 305,818 | 305,216 | 333,936 | 305,826 | 272,165 |
Product Net Sales | ||||||||||||
Revenues | ||||||||||||
Total revenues | $ 6,617 | $ 2,220 | $ 10,469 | $ 7,957 | $ 7,317 | |||||||
Other Revenue | ||||||||||||
Revenues | ||||||||||||
Total revenues | $ 37 | $ 1,772 | $ 2,268 | $ 672 | $ 5,413 |
Transition Period - Unaudited_2
Transition Period - Unaudited Comparative Financial Information Statements of Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Cash flows from operating activities | |||||
Net loss | $ (71,906) | $ (61,816) | $ (295,167) | $ (170,459) | $ (91,696) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||||
Foreign exchange loss (gain) | 742 | (180) | 4,917 | 9,280 | (35,750) |
Stock-based compensation | 9,683 | 5,592 | 31,627 | 15,479 | 12,661 |
Depreciation and amortization | 2,534 | 2,163 | 9,290 | 7,054 | 5,152 |
Deferred income taxes | (1,265) | (1,152) | (317) | (3,770) | (2,343) |
Other | 8 | 241 | 1,554 | 1 | |
Changes in operating assets and liabilities: | |||||
Accounts receivable, net | (2,125) | (223) | (804) | (277) | (735) |
Inventory | (14,460) | 378 | (13,646) | 5 | 656 |
Prepaid expenses and other current assets | (3,635) | (516) | 14,489 | (12,471) | (11,415) |
Other assets | (47) | (166) | (564) | ||
Accounts payable | (1,211) | (1,802) | 2,238 | 3,171 | (403) |
Current tax liabilities | 878 | 4,898 | 54 | 57 | 432 |
Accrued liabilities | 5,942 | 3,004 | 16,507 | 1,253 | 3,397 |
Other current liabilities | 93 | (2,071) | (1,546) | (11) | (80) |
Long-term liabilities | 317 | 325 | 813 | 161 | 195 |
Net cash used in operating activities | (74,460) | (51,558) | (231,868) | (148,974) | (119,928) |
Cash flows from investing activities | |||||
Additions to property, plant and equipment | (18,687) | (7,748) | (31,362) | (19,285) | (12,192) |
Additions to capitalized software | (63) | (993) | (2,042) | (812) | (719) |
Proceeds from disposal of property, plant and equipment | 517 | ||||
Net cash used in investing activities | (18,750) | (8,741) | (32,887) | (20,097) | (12,911) |
Cash flows from financing activities | |||||
Proceeds from issuance of ordinary shares, net of issuance costs | 324,638 | 297,932 | 297,931 | 273,804 | |
Proceeds from exercise of stock options | 1 | 621 | 122 | 972 | |
Payments on build-to-suit financing obligation | (26) | (113) | (105) | (21) | |
Payments on capital leases | (40) | (39) | (163) | (156) | (157) |
Payments on landlord financing obligation | (130) | (125) | (522) | (1,074) | (337) |
Net cash provided by (used in) financing activities | 324,468 | 297,743 | 297,754 | (1,213) | 274,261 |
Effect of exchange rate changes on cash | 5,326 | (371) | (240) | 8,993 | (13,268) |
Net increase (decrease) in cash and cash equivalents | 236,584 | 237,073 | 32,759 | (161,291) | 128,154 |
Cash and cash equivalents at beginning of period | 354,913 | 322,154 | 322,154 | 483,445 | 355,291 |
Cash and cash equivalents at end of period | $ 591,497 | $ 559,227 | $ 354,913 | $ 322,154 | $ 483,445 |