Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2023 | May 05, 2023 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2023 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | RETA | |
Entity Registrant Name | Reata Pharmaceuticals, Inc. | |
Entity Central Index Key | 0001358762 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Current Reporting Status | Yes | |
Entity File Number | 001-37785 | |
Entity Tax Identification Number | 11-3651945 | |
Entity Address, Address Line One | 5320 Legacy Drive | |
Entity Address, City or Town | Plano | |
Entity Address, State or Province | TX | |
Entity Address Postal Zip Code | 75024 | |
City Area Code | 972 | |
Local Phone Number | 865-2219 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Title of 12(b) Security | Class A Common Stock, Par Value $0.001 Per Share | |
Security Exchange Name | NASDAQ | |
Entity Interactive Data Current | Yes | |
Entity Incorporation, State or Country Code | DE | |
Common Stock A | ||
Document Information [Line Items] | ||
Entity Common Stock Shares Outstanding | 33,036,126 | |
Common Stock B | ||
Document Information [Line Items] | ||
Entity Common Stock Shares Outstanding | 4,515,316 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Assets | ||
Cash and cash equivalents | $ 84,940 | $ 42,312 |
Marketable debt securities | 236,019 | 345,202 |
Prepaid expenses and other current assets | 11,583 | 10,256 |
Total current assets | 332,542 | 397,770 |
Property and equipment, net | 11,060 | 11,179 |
Operating lease right-of-use-assets | 103,807 | 105,258 |
Inventory, noncurrent | 5,713 | 0 |
Other assets | 460 | 284 |
Total assets | 453,582 | 514,491 |
Liabilities and stockholders’ equity | ||
Accounts payable | 14,448 | 18,706 |
Accrued direct research liabilities | 19,445 | 13,836 |
Other current liabilities | 17,499 | 24,267 |
Operating lease liabilities, current | 3,206 | 2,151 |
Total current liabilities | 54,598 | 58,960 |
Opearting lease liabilities, noncurrent | 114,727 | 117,313 |
Liability related to sale of future royalties, net | 414,930 | 403,913 |
Total noncurrent liabilities | 529,657 | 521,226 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Additional paid-in capital | 1,552,938 | 1,501,800 |
Accumulated deficit | (1,683,649) | (1,567,532) |
Total stockholders’ equity | (130,673) | (65,695) |
Total liabilities and stockholders’ equity | 453,582 | 514,491 |
Common Stock A | ||
Stockholders’ equity: | ||
Common stock value | 33 | 32 |
Common Stock B | ||
Stockholders’ equity: | ||
Common stock value | $ 5 | $ 5 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2023 | Dec. 31, 2022 |
Common Stock A | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 33,010,817 | 31,762,052 |
Common stock, shares outstanding | 33,010,817 | 31,762,052 |
Common Stock B | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 4,516,934 | 4,913,348 |
Common stock, shares outstanding | 4,516,934 | 4,913,348 |
Unaudited Consolidated Statemen
Unaudited Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Collaboration revenue | ||
Collaboration revenue | $ 195 | $ 914 |
Operating cost and expenses | ||
Research and development | 55,477 | 39,804 |
Selling, general and administrative | 54,885 | 24,841 |
Depreciation | 288 | 308 |
Total operating cost and expenses | 110,650 | 64,953 |
Other income (expense), net | (5,662) | (9,772) |
Loss from operations | (116,117) | (73,811) |
Benefit from (provision for) taxes on income | 0 | (31) |
Net loss | $ (116,117) | $ (73,842) |
Net loss per share, basic | $ (3.14) | $ (2.03) |
Net loss per share, diluted | $ (3.14) | $ (2.03) |
Weighted-average number of common shares used in net loss per share, basic | 36,948,063 | 36,412,621 |
Weighted-average number of common shares used in net loss per share, diluted | 36,948,063 | 36,412,621 |
License and milestone | ||
Collaboration revenue | ||
Collaboration revenue | $ 0 | $ 893 |
Other revenue | ||
Collaboration revenue | ||
Collaboration revenue | $ 195 | $ 21 |
Unaudited Consolidated Statem_2
Unaudited Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock A | Common Stock B | Common Stock Common Stock A | Common Stock Common Stock B | Additional Paid-In Capital | Total Accumulated Deficit |
Balance, value at Dec. 31, 2021 | $ 185,989 | $ 31 | $ 5 | $ 1,441,584 | $ (1,255,631) | ||
Balance, shares at Dec. 31, 2021 | 31,478,197 | 4,919,249 | |||||
Net loss | (73,842) | (73,842) | |||||
Compensation expense related to stock-based compensation | 15,444 | 15,444 | |||||
Exercise of options, value | 194 | 194 | |||||
Exercise of options, shares | 9,375 | ||||||
Issuance of common stock upon vesting of restricted stock units, shares | 35,107 | 2,835 | |||||
Conversion of common stock Class B to Class A, shares | 12,210 | (12,210) | |||||
Balance, value at Mar. 31, 2022 | 127,785 | $ 31 | $ 5 | 1,457,222 | (1,329,473) | ||
Balance, shares at Mar. 31, 2022 | 31,525,514 | 4,919,249 | |||||
Balance, value at Dec. 31, 2022 | (65,695) | $ 32 | $ 5 | 1,501,800 | (1,567,532) | ||
Balance, shares at Dec. 31, 2022 | 31,762,052 | 4,913,348 | 31,762,052 | 4,913,348 | |||
Net loss | (116,117) | (116,117) | |||||
Compensation expense related to stock-based compensation | 38,057 | 38,057 | |||||
Exercise of options, value | $ 13,081 | $ 1 | 13,080 | ||||
Exercise of options, shares | 519,224 | 519,224 | |||||
Issuance of common stock upon vesting of restricted stock units, value | $ 1 | 1 | |||||
Issuance of common stock upon vesting of restricted stock units, shares | 333,127 | ||||||
Conversion of common stock Class B to Class A, shares | 396,414 | (396,414) | |||||
Balance, value at Mar. 31, 2023 | $ (130,673) | $ 33 | $ 5 | $ 1,552,938 | $ (1,683,649) | ||
Balance, shares at Mar. 31, 2023 | 33,010,817 | 4,516,934 | 33,010,817 | 4,516,934 |
Unaudited Consolidated Statem_3
Unaudited Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Operating activities | ||
Net loss | $ (116,117) | $ (73,842) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation | 288 | 308 |
Non-cash interest expense on liability related to sale of future royalty | 11,017 | 9,871 |
Stock-based compensation expense | 38,057 | 15,444 |
Amortization of discount (premium) on marketable debt securities | (1,954) | 0 |
Changes in operating assets and liabilities: | ||
Income tax receivable and payable | 9 | 0 |
Prepaid expenses, other current assets and other assets | (1,334) | 877 |
Inventory | (5,713) | 0 |
Accounts payable | (4,355) | (4,525) |
Accrued expenses, other current and long-term liabilities | (1,268) | (8,914) |
Operating lease obligations | (80) | 3,489 |
Deferred revenue | 0 | (893) |
Net cash used in operating activities | (81,449) | (58,185) |
Investing activities | ||
Purchases of property and equipment | (141) | (288) |
Purchases of marketable securities | (63,864) | 0 |
Maturity from marketable securities | 175,000 | |
Net cash provided by (used in) investing activities | 110,995 | (288) |
Financing activities | ||
Exercise of options | 13,081 | 194 |
Issuance of common stock | 1 | 0 |
Net cash provided by financing activities | 13,082 | 194 |
Net increase (decrease) in cash and cash equivalents | 42,628 | (58,279) |
Cash and cash equivalents at beginning of year | 42,312 | 590,258 |
Cash and cash equivalents at end of period | 84,940 | 531,979 |
Non-cash activity: | ||
Right-of-use assets obtained in exchange for lease obligations | 0 | 4,885 |
Purchases of equipment in accounts payable, accrued expenses, other current, and long-term liabilities | $ 106 | $ 2,258 |
Description of Business
Description of Business | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | 1. Description of Business Reata Pharmaceuticals, Inc.’s (Reata, the Company, we, us, or our) mission is to identify, develop, and commercialize innovative therapies that change patients’ lives for the better. The Company focuses on small-molecule therapeutics with novel mechanisms of action for the treatment of severe, life-threatening diseases with few or no approved therapies. Our first product, SKYCLARYS® (omaveloxolone), is the first and only drug approved by U.S. Food and Drug Administration (FDA) for the treatment of Friedreich's ataxia (FA) in adults and adolescents aged 16 years and older. We have submitted a Marketing Authorization Application (MAA) for omaveloxolone for the treatment of FA to the European Medicines Agency (EMA) in Europe and the application is under review. We are also developing cemdomespib (previously referred to as RTA 901), the lead product candidate from our Hsp90 modulator program, in neurological indications . Omaveloxolone activates the transcription factor Nrf2 to normalize mitochondrial function, restore redox balance, and resolve inflammation, in nonclinical models. Because mitochondrial dysfunction, oxidative stress, and inflammation are features of many diseases, we believe our Nrf2 activators have many potential clinical applications. We possess exclusive, worldwide rights to develop, manufacture, and commercialize omaveloxolone. We are the exclusive licensee of cemdomespib and have worldwide commercial rights. In May 2023, Kyowa Kirin reported results from the AYAME study, a Phase 3 trial which was conducted in Japan studying the safety and efficacy of bardoxolone in patients with diabetic kidney disease. Based on the results of AYAME and its potential regulatory impact, we and Kyowa Kirin have decided to discontinue our bardoxolone CKD programs, including the FALCON and EAGLE clinical trials. See Note 13, Subsequent Events, to our condensed consolidated financial statements for further details. The Company’s consolidated financial statements include the accounts of all majority-owned subsidiaries. Accordingly, the Company’s share of net earnings and losses from these subsidiaries is included in the consolidated statements of operations. Intercompany profits, transactions, and balances have been eliminated in consolidation . |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (U.S. GAAP) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and notes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023. The consolidated balance sheet at December 31, 2022, has been derived from the audited consolidated financial statements at that date but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. For further information, refer to the annual consolidated financial statements and footnotes thereto of the Company. New Accounting Pronouncements From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that the Company adopts as of the specified effective date. Unless otherwise discussed below, the Company does not believe that the adoption of recently issued standards have or may have a material impact on its condensed consolidated financial statements and disclosures. Summary of Significant Accounting Policies The significant accounting policies used in the preparation of these condensed consolidated financial statements for the three months ended March 31, 2023 are consistent with those discussed in Note 2 to the consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, with the exception of the following: Inventory We capitalize inventory costs related to products to be sold in the ordinary course of business. We make a determination of capitalizing inventory costs for a product based on, among other factors, status of regulatory approval, information regarding safety, efficacy and expectations relating to commercial sales and recoverability of costs. Pre-launch inventory is held as an asset when there is a high probability of regulatory approval for the product and when there are probable future economic profits. Inventory may consist of raw materials, work in process and finished goods. We began capitalizing inventory related to SKYCLARYS in the quarter ended March 31, 2023, as we received approval of SKYCLARYS in February 2023, and the related costs were expected to be recoverable through the commercialization of SKYCLARYS. Prior to the start of capitalizing inventory, costs for commercially saleable product and materials of $ 39.2 million were incurred and included in research and development expenses. As a result, cost of product revenues related to SKYCLARYS will initially reflect a lower average per unit cost of materials over the next 35-40 months as previously expensed inventory is utilized for commercial production and sold to customers. Inventories are valued under the specific identification method and are stated at the lower of cost or net realizable value. We measure inventory based on lot-based costing where inventory is valued at the purchase price for the specific lot. We assess recoverability of inventory each reporting period to determine any write down to net realizable value resulting from excess or obsolete inventories. |
Collaboration Agreements
Collaboration Agreements | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Collaboration Agreements | 3. Collaboration Agreements Subsequent to the 2019 reacquisition of certain rights originally licensed to AbbVie Inc. (AbbVie) (see “ AbbVie ,” below), the Company’s collaboration revenue and deferred revenue have been generated primarily from licensing fees and reimbursements for expenses received under our exclusive license with Kyowa Kirin (the Kyowa Kirin Agreement). Kyowa Kirin In December 2009, the Company entered into an exclusive license with Kyowa Kirin to develop and commercialize bardoxolone in the licensed territory. The terms of the agreement include payment to the Company of a nonrefundable, up-front license fee of $ 35.0 million and additional development and commercial milestone payments. As of March 31, 2023, the Company has received $ 50.0 million related to regulatory development milestone payments from Kyowa Kirin and has the potential in the future to achieve another $ 47.0 million from regulatory milestones and $ 140.0 million from commercial milestones. The Company also has the potential to achieve tiered royalties ranging from the low teens to the low 20 percent range, depending on the country of sale and the amount of annual net sales, on net sales by Kyowa Kirin in the licensed territory. The Company is participating on a joint steering committee with Kyowa Kirin to oversee the development and commercialization activities related to bardoxolone. Any future milestones and royalties received are subject to mid to lower single digit percent declining tiered commissions to certain consultants as compensation for negotiations of the Kyowa Kirin Agreement. The Company regularly evaluates its remaining performance obligation under the Kyowa Kirin Agreement. Accordingly, revenue may fluctuate from period to period due to changes to its estimated performance obligation period and variable considerations. The Company began recognizing revenue related to the up-front payment upon execution of the Kyowa Kirin Agreement as the Company’s period of performance began. In March 2021, the Company’s performance obligation period under the Kyowa Kirin Agreement was extended to and completed in June 2022. On July 27, 2021, Kyowa Kirin submitted a New Drug Application (NDA) in Japan to the Ministry of Health, Labour and Welfare for bardoxolone for improvement of renal function in patients with Alport syndrome. Based on this submission, the Company earned a $ 5.0 million milestone payment, variable consideration previously considered constrained, under the Kyowa Kirin Agreement. As a result, the Company recorded $ 4.7 million in collaboration revenue, a cumulative catch-up for the portion of this milestone that was satisfied in prior periods, and $ 0.3 million in deferred revenue that was recognized over the remaining performance obligation period. Under the Kyowa Kirin Agreement, we will not recognize any deferred revenue subsequent to June 30, 2022. In May 2023, Kyowa Kirin reported results from the AYAME study, a Phase 3 trial which was conducted in Japan studying the safety and efficacy of bardoxolone in patients with diabetic kidney disease. Based on the results of AYAME and its potential regulatory impact, we and Kyowa Kirin have decided to discontinue our bardoxolone CKD programs, including the FALCON and EAGLE clinical trials. See Note 13, Subsequent Events, to our condensed consolidated financial statements for further details. AbbVie In September 2010, the Company entered into a license agreement with AbbVie (the AbbVie License Agreement) for an exclusive license to develop and commercialize bardoxolone in the Licensee Territory (as defined in the AbbVie License Agreement). In December 2011, the Company entered into a collaboration agreement with AbbVie (the Collaboration Agreement) to jointly research, develop, and commercialize the Company’s portfolio of second and later generation oral Nrf2 activators. In October 2019, the Company and AbbVie entered into an Amended and Restated License Agreement (the Reacquisition Agreement) pursuant to which the Company reacquired the development, manufacturing, and commercialization rights concerning its proprietary Nrf2 activator product platform originally licensed to AbbVie in the AbbVie License Agreement and the Collaboration Agreement . In exchange for such rights, the Company agreed to pay AbbVie $ 330.0 million, all of which was subsequently paid. Additionally, the Company will pay AbbVie an escalating, low single-digit royalty on worldwide net sales, on a product-by-product basis, of omaveloxolone and certain next-generation Nrf2 activators. The execution of the Reacquisition Agreement ended our performance obligations under the Collaboration Agreement. As of December 31, 2021, the Company has fully satisfied its payable to AbbVie, therefore no interest expense was recognized thereafter. |
Liability Related to Sale of Fu
Liability Related to Sale of Future Royalties | 3 Months Ended |
Mar. 31, 2023 | |
Liability Related To Sale Of Future Royalties [Abstract] | |
Liability Related to Sale of Future Royalties | 4. Liability Related to Sale of Future Royalties On June 24, 2020, the Company closed on the Development and Commercialization Funding Agreement with an affiliate of Blackstone Life Sciences, LLC (BXLS), which provides funding for the development and commercialization of bardoxolone for the treatment of CKD caused by Alport syndrome, autosomal dominant polycystic kidney disease (ADPKD), and certain other rare CKD indications in return for future royalties (the Development Agreement). The Development Agreement includes a $ 300.0 million payment by an affiliate of BXLS in return for various percentage royalty payments on worldwide net sales of bardoxolone, once approved in the United States or certain specified European countries, by Reata and its licensees, other than Kyowa Kirin. The royalty percentage will initially be in the mid-single digits and, in future years, can vary between higher-mid single digit percentages to low-single digit percentages depending on various milestones, including indication approval dates, cumulative royalty payments, and cumulative net sales. Pursuant to the Development Agreement, we have granted BXLS a security interest in substantially all of our assets. After a bardoxolone product approval has been obtained by the Company, the Company is obligated to make certain minimum cumulative payment amounts in 2025 through 2033, but only until BXLS has achieved a certain internal rate of return target. In addition, concurrent with the Development Agreement, the Company entered into a common stock purchase agreement (the Purchase Agreement) with affiliates of BXLS to sell an aggregate of 340,793 shares of the Company’s Class A common stock at $ 146.72 per share for a total of $ 50.0 million. The Company concluded that there were two units of accounting for the consideration received, comprised of the liability related to the sale of future royalties and the common shares. The Company allocated the $ 300.0 million from the Development Agreement and $ 50.0 million from the Purchase Agreement between the two units of accounting on a relative fair value basis at the time of the transaction. The Company allocated $ 294.5 million, which includes $ 0.8 million in transaction costs incurred, in transaction consideration to the liability, and $ 55.5 million to the common shares. The Company determined the fair value of the common shares based on the closing stock price on June 24, 2020, the closing date of the Development Agreement. At inception, the effective interest rate under the Development Agreement, including transaction costs, was approximately 13.8 %. During the first quarter of 2022, the Company reassessed the expected royalty payments and lowered our previous estimate of future sales for which royalties will be paid. Accordingly, we have prospectively adjusted and recognized lower non-cash interest expense using a 10.9 % effective interest rate, as of March 31, 2023. The following table shows the activity within the liability related to sale of future royalties for the three months ended March 31, 2023: Liability Related to Sale of Future Royalties (in thousands) Balance at December 31, 2022 $ 404,634 Non-cash interest expense recognized 11,000 Balance at March 31, 2023 415,634 Less: Unamortized transaction cost ( 704 ) Carrying value at March 31, 2023 $ 414,930 On May 4, 2023, we entered into an Amended and Restated Development and Commercialization Funding Agreement (the Amended Funding Agreement) with BXLS. See Note 13, Subsequent Events, to our condensed consolidated financial statements or further details. |
Inventory
Inventory | 3 Months Ended |
Mar. 31, 2023 | |
Inventory Disclosure [Abstract] | |
Inventory | 5. Inventory All of the Company’s inventories relate to the manufacturing of SKYCLARYS. The following table sets forth the Company’s inventories as of March 31, 2023: Three Months Ended March 31 2023 (in thousands) Raw materials $ 3,446 Work-in-process 2,267 Finished goods — Total $ 5,713 Inventory in excess of the amount expected to be sold within one year is classified as noncurrent inventory. At March 31, 2023, all of the Company’s inventories were classified as noncurrent inventory. |
Marketable Debt Securities
Marketable Debt Securities | 3 Months Ended |
Mar. 31, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Marketable Debt Securities | 6. Marketable Debt Securities During the quarter ended March 31, 2023, the Company invested its excess cash balances in marketable debt securities and, at each balance sheet date presented, the Company classified all of its investments in debt securities as held-to-maturity and as current assets as they mature within 12 months and represent the investment of funds available for current operations. The Company considers all available evidence to evaluate if an impairment loss exists, and if so, marks the investment to market through a charge to the Company’s consolidated statements of operations and comprehensive loss. The Company did not record any impairment charges related to our marketable debt securities during the three months ended March 31, 2023. The following tables summarize our marketable debt securities (in thousands), as of March 31, 2023: Amortized Gross Gross Fair Value (1) Marketable debt securities: U.S. treasury securities 236,019 17 ( 27 ) 236,009 Total $ 236,019 $ 17 $ ( 27 ) $ 236,009 (1) The fair value was determined using the three-tier fair value hierarchy for disclosure in accordance with Accounting Standards Codification 820-10. The Company’s investments in marketable securities are classified within Level 2 of the fair value hierarchy. The Company uses quoted prices for similar assets sourced from certain third-party pricing services. The third-party pricing services generally utilize industry standard valuation models for which all significant inputs are observable, either directly or indirectly, to estimate the price or fair value of the securities. The primary input generally includes reported trades of or quotes on the same or similar securities. The Company does not make additional judgments or assumptions made to the pricing data sourced from the third-party pricing services. |
Other Income (Expense), Net
Other Income (Expense), Net | 3 Months Ended |
Mar. 31, 2023 | |
Other Income and Expenses [Abstract] | |
Other Income (Expense), Net | 7. Other Income (Expense), Net Three Months Ended March 31 2023 2022 (in thousands) Other income (expense), net Investment income $ 3,435 $ 132 Non-cash interest expense on liability ( 11,017 ) ( 9,871 ) Other income (expense) 1,920 ( 33 ) Total other income (expense), net $ ( 5,662 ) $ ( 9,772 ) Investment Income Interest income consists primarily of interest generated from our cash and cash equivalents and marketable debt securities. Non-Cash Interest Expense on Liability Related to Sale of Future Royalties Non-cash interest expense consists of recognition of interest expense based on the Company’s current estimate of future royalties expensed to be paid over the estimated term of the Development Agreement. Other Income (Expense) Other income (expense) consists primarily of gains and losses on foreign currency exchange, sales of assets, lease termination and employee retention credit. In the three months ended March 31, 2023, other income included $ 2.0 million, related to the employee retention credit (ERC) under the CARES Act. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2023 | |
Leases [Abstract] | |
Leases | 8. Leases The Company headquarters is located in Plano, Texas, where it leases approximately 122,000 square feet of office space. The Company leases additional space located in Irving, Texas, where it leases approximately 34,890 square feet of office and laboratory space. On February 4, 2022, the Company extended the lease for the office and laboratory space in Irving, Texas, to October 31, 2024 , with an option to extend for a fixed 12-month period. On March 8, 2022, the Company extended the lease for the Plano office to December 31, 2023 . The Company has an additional lease of a single-tenant, build-to-suit building of approximately 327,400 square feet of office and laboratory space located in Plano, Texas with an initial lease term of 16 years. The Company entered into the lease agreement on October 15, 2019 (the 2019 Lease Agreement), and at the Company’s option , it may renew the lease for two consecutive five-year renewal periods or one ten-year renewal period . On December 15, 2021, the Company obtained control of the space, and, accordingly, the Company recorded related right-of-use assets and the lease liabilities during the fourth quarter of 2021. The Company recorded the liability associated with the 2019 Lease Agreement at the present value of the lease payments not yet paid, using the discount rate as of the commencement date. As the discount rate implicit in the 2019 Lease Agreement was not readily determinable, the Company utilized its incremental borrowing rate. The renewals are not assumed in the determination of the lease term, since they are not deemed to be reasonably assured at the inception of the lease. At inception, the Company recorded $ 124.5 million as a right-of-use asset, which represented a lease liability of $ 133.2 million, net of $ 8.7 million of lease incentives recognized. For the three months ended March 31, 2023, the Company paid $ 3.9 million for amounts included in the measurement of lease liabilities. During the three months ended March 31, 2023 and 2022, the Company recorded total rent expense of $ 4.3 million and $ 4.3 million, respectively. Supplemental balance sheet and other information related to the Company’s operating leases is as follows: As of March 31, 2023 2022 Weighted-average remaining lease term (in years) 15.0 15.6 Weighted-average discount rate 6.5 % 6.5 % Maturities of lease liabilities by fiscal year for the Company’s operating leases: As of March 31, 2023 (in thousands) 2023 (remaining nine months) $ 5,835 2024 (1) 6,457 2025 11,777 2026 12,007 2027 12,241 Thereafter 143,829 Total lease payments (1) 192,146 Less: Imputed interest ( 74,213 ) Present value of lease liabilities $ 117,933 (1) Above table includes one year rent abatement applied beginning in June 2023 following FDA approval of SKYCLARYS |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 9. Income Taxes The following table summarizes income tax benefit expense and effective income tax rate: Three Months Ended March 31 2023 2022 (in thousands, except for percentage data) Benefit from (provision for) taxes on income $ — $ ( 31 ) Effective income tax rate 0.0 % 0.0 % The Company’s effective tax rate for the three months ended March 31, 2023, varies with the statutory rate primarily due to changes in the valuation allowance related to certain deferred tax assets generated or utilized in the applicable period. Deferred tax assets are regularly reviewed for recoverability by jurisdiction and valuation allowances are established based on historical and projected future taxable losses and the expected timing of the reversals of existing temporary differences. The Company has recorded valuation allowances against the majority of its deferred tax assets as of March 31, 2023 , and the Company expects to maintain these valuation allowances until there is sufficient evidence that future earnings can be achieved, which is uncertain at this time. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | 10 . Stock-Based Compensation In 2022, our stockholders approved the Reata Pharmaceuticals, Inc. 2022 Employee Stock Purchase Plan (the "ESPP"), pursuant to which 500,000 shares of common stock were authorized for issuance. Under the ESPP, each offering period is twelve months, with two six-month purchase periods. At the end of each purchase period the employees may purchase shares of common stock through payroll deductions made over the term of the purchase period. The per-share purchase price at the end of each purchase period is equal to the lesser of 85 % of the closing price of the Company’s common stock at the beginning of the offering period or the purchase date. As of March 31, 2023, the Company has not issued any common stock in relation to the ESPP. The Company recorded approximately $ 0.2 million in compensation expense related to the ESPP during the three months ended March 31, 2023. The following table summarizes time-based and performance-based stock compensation expense reflected in the consolidated statements of operations: Three Months Ended March 31 2023 2022 (in thousands) Research and development $ 14,270 $ 7,606 Selling, general and administrative 23,787 7,838 Total stock compensation expense $ 38,057 $ 15,444 Restricted Stock Units (RSUs) The following table summarizes RSUs as of March 31, 2023, and changes during the three months ended March 31, 2023, under the Second Amended and Restated Long Term Incentive Plan (LTIP Plan): Number of Weighted-Average Outstanding at January 1, 2023 1,151,656 $ 45.45 Granted 453,049 40.03 Vested ( 352,042 ) 34.64 Forfeited ( 13,113 ) 50.56 Outstanding at March 31, 2023 1,239,550 $ 46.48 As of March 31, 2023, total unrecognized compensation expense related to RSU and performance-based RSU awards that were deemed probable of vesting was approximately $ 41.2 million, which excludes 36,500 shares of unvested performance-based RSUs that were deemed not probable of vesting totaling unrecognized stock-based compensation expense of $ 4.4 million. Stock Options The following table summarizes stock option activity as of March 31, 2023, and changes during the three months ended March 31, 2023, under the LTIP Plan and standalone option agreements: Number of Weighted- Outstanding at January 1, 2023 6,009,199 $ 65.92 Granted 1,784,222 37.69 Exercised ( 519,224 ) 25.21 Forfeited ( 248,260 ) 188.95 Expired ( 44,033 ) 111.59 Outstanding at March 31, 2023 6,981,904 $ 56.57 Exercisable at March 31, 2023 3,376,690 $ 64.37 As of March 31, 2023, total unrecognized compensation expense related to stock options and performance- based stock options that were deemed probable of vesting was approximately $ 92.1 million, which excludes 172,500 shares of unvested performance-based stock options that were deemed not probable of vesting totaling unrecognized stock-based compensation expense of $ 13.2 million. The total intrinsic value of all outstanding options and exercisable options as of March 31, 2023 was $ 313.6 million and $ 141.1 million, respectively. The number of weighted average options that were not included in the diluted earnings per share calculation because the effect would have been anti-dilutive represented 8,221,454 a nd 6,878,671 shares as of March 31, 2023 and 2022 , respectively. |
Employee Benefit Plans
Employee Benefit Plans | 3 Months Ended |
Mar. 31, 2023 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plans | 11. Employee Benefit Plans In 2010, we adopted an Employee Investment Plan, qualified under Section 401(k) of the Internal Revenue Code, which is a retirement savings plan covering substantially all of our U.S. employees (the Plan). The Plan is administered under the “safe harbor” provision of ERISA. Under the Plan, an eligible employee may elect to contribute a percentage of their salary on a pre-tax basis, subject to federal statutory limitations. Beginning in January 2019, the Company implemented a discretionary employer matching contribution of $ 1.00 for every $ 1.00 contributed by a participating employee up to $ 7,000 annually in 2023 and 2022, which such matching contributions become fully vested after four years of service. The Company recorded expense of $ 1.4 million and $ 1.3 million for the three months ended March 31, 2023 and 2022, which includes the Company’s contributions and administrative costs. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 12. Commitments and Contingencies Litigation From time to time, the Company is a party to legal proceedings in the course of its business, including the matters described below. The outcome of any such legal proceedings, regardless of the merits, is inherently uncertain. In addition, litigation and related matters are costly and may divert the attention of our management and other resources that would otherwise be engaged in other activities. If the Company were unable to prevail in any such legal proceedings, its business, results of operations, liquidity and financial condition could be adversely affected. The Company recognizes accruals for litigations to the extent that it can conclude that a loss is both probable and reasonably estimable and recognizes legal expenses as incurred. Bardoxolone Securities Litigation In late 2021 and early 2022, certain putative stockholders of the Company filed complaints in the United States District Court for the Eastern District of Texas alleging violations of the federal securities laws against the Company and certain of its executives, including its Chief Executive Officer; its Chief Operating Officer, Chief Financial Officer, and President; and its Chief Innovation Officer (in one of the suits). On April 22, 2022, the suits were consolidated, and a lead plaintiff was appointed. On June 21, 2022, the lead plaintiff filed a complaint against the Company, the aforementioned executives, certain current and former member of the Company’s Board of Directors, and underwriters in connection with secondary offerings of Company stock in 2019 and 2020. The complaint alleges, among other things, that the Company made false and misleading statements regarding the sufficiency of the Phase 2 and Phase 3 CARDINAL studies to support an NDA for bardoxolone in the treatment of CKD caused by Alport syndrome, and the Company’s interactions with the FDA concerning potential approval for bardoxolone. The complaint asserts claims under the Securities Act of 1933 and the Securities Exchange Act of 1934 (Exchange Act). The plaintiffs seek, among other things, a class action designation, an award of damages, and costs and expenses, including attorney fees and expert fees. The Company believes that the allegations contained in the complaint are without merit and intends to defend the case. The Company cannot predict at this point the length of time that this action will be ongoing or the liability, if any, which may arise therefrom. Indemnifications Accounting Standards Codification 460, Guarantees , requires that, upon issuance of a guarantee, the guarantor must recognize a liability for the fair value of the obligations it assumes under that guarantee. As permitted under Delaware law and in accordance with the Company’s bylaws, officers and directors are indemnified for certain events or occurrences, subject to certain limits, while the officer or director is or was serving in such capacity. The maximum amount of potential future indemnification is unlimited; however, the Company has obtained director and officer insurance that limits its exposure and may enable recoverability of a portion of any future amounts paid. The Company believes the fair value for these indemnification obligations is minimal. Accordingly, the Company has no t recognized any liabilities relating to these obligations as of March 31, 2023 . The Company has certain agreements with licensors, licensees, collaborators, and vendors that contain indemnification provisions. In such provisions, the Company typically agrees to indemnify the licensor, licensee, collaborator, or vendor against certain types of third-party claims. The Company accrues for known indemnification issues when a loss is probable and can be reasonably estimated. There were no accruals for expenses related to indemnification issues for any period presented. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | 13. Subsequent Events AYAME Study In May 2023, Kyowa Kirin reported results from the AYAME study, a Phase 3 trial which was conducted in Japan to evaluate the safety and efficacy of bardoxolone in patients with diabetic kidney disease. AYAME met its primary and key secondary endpoints, and no significant safety issues were noted. However, there was no separation in the occurrence of ESRD events between the bardoxolone and placebo groups after three years of treatment. Based on the results of AYAME and its potential regulatory impact, we and Kyowa Kirin have decided to discontinue our bardoxolone CKD programs, including the FALCON and EAGLE clinical trials. We are not expecting any material costs to be incurred in connection with the discontinuance of these ongoing studies. Liability Related to Sale of Future Royalties With the discontinuation of bardoxolone development, on May 4, 2023, we entered into an Amended and Restated Development and Commercialization Funding Agreement (the Amended Funding Agreement) with BXLS. The Amended Funding Agreement provides that all covenants in the Development and Commercialization Funding Agreement regarding commercialization of bardoxolone, restricting the incurrence of indebtedness, and restricting license and licensing transactions are removed and all prior security interests granted to BXLS are released. In addition, the Amended Funding Agreement provides for a low, single digit royalty payment to BXLS on net sales of omaveloxolone for Friedreich's ataxia. Pursuant to the Amended Funding Agreement, to secure our payment obligations to BXLS, (i) we have granted BXLS a security interest in a segregated deposit account and (ii), subject to certain limitations as set forth in the Amended Funding Agreement, have agreed to maintain in such account an initial balance and thereafter an amount equal to the aggregate amount of Omav Royalty payments made for the immediately preceding two calendar quarter period. We are currently evaluating the net impact on the liability related to sale of future royalties and any adjustments will be recorded in second quarter financial statements. Term Loan On May 5, 2023, the Company, entered into an agreement (the Term Loan) with BPCR Limited Partnership and BioPharma Credit Investments V (Master) LP, as Lenders, which are funds managed by Pharmakon Advisors, LP, and BioPharma Credit PLC, as the collateral agent for the Lenders, pursuant to which the Lenders agreed to make term loans to the Company in an aggregate principal amount of up to $275 million. The initial tranche of $75 million will be funded on May 12, 2023, the second tranche of $50 million is conditioned on meeting certain regulatory or product production criteria and two final tranches of $75 million each will be made available based on the achievement of certain commercial sales milestones; with the fourth tranche being optional to the Company. The Term Loan bears interest at 7.50% plus three-month SOFR per annum, with a SOFR floor of 2.50%. Repayment terms are quarterly interest-only payments for three years, then quarterly amortization over the following two years. The Term Loan is secured by substantially all of the assets of the Company, its U.S. subsidiaries, and its U.K., Swiss, and Irish subsidiaries. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (U.S. GAAP) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and notes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023. The consolidated balance sheet at December 31, 2022, has been derived from the audited consolidated financial statements at that date but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. For further information, refer to the annual consolidated financial statements and footnotes thereto of the Company. |
New Accounting Pronouncements | New Accounting Pronouncements From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that the Company adopts as of the specified effective date. Unless otherwise discussed below, the Company does not believe that the adoption of recently issued standards have or may have a material impact on its condensed consolidated financial statements and disclosures. |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies The significant accounting policies used in the preparation of these condensed consolidated financial statements for the three months ended March 31, 2023 are consistent with those discussed in Note 2 to the consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, with the exception of the following: |
Inventory | Inventory We capitalize inventory costs related to products to be sold in the ordinary course of business. We make a determination of capitalizing inventory costs for a product based on, among other factors, status of regulatory approval, information regarding safety, efficacy and expectations relating to commercial sales and recoverability of costs. Pre-launch inventory is held as an asset when there is a high probability of regulatory approval for the product and when there are probable future economic profits. Inventory may consist of raw materials, work in process and finished goods. We began capitalizing inventory related to SKYCLARYS in the quarter ended March 31, 2023, as we received approval of SKYCLARYS in February 2023, and the related costs were expected to be recoverable through the commercialization of SKYCLARYS. Prior to the start of capitalizing inventory, costs for commercially saleable product and materials of $ 39.2 million were incurred and included in research and development expenses. As a result, cost of product revenues related to SKYCLARYS will initially reflect a lower average per unit cost of materials over the next 35-40 months as previously expensed inventory is utilized for commercial production and sold to customers. Inventories are valued under the specific identification method and are stated at the lower of cost or net realizable value. We measure inventory based on lot-based costing where inventory is valued at the purchase price for the specific lot. We assess recoverability of inventory each reporting period to determine any write down to net realizable value resulting from excess or obsolete inventories. |
Liability Related to Sale of _2
Liability Related to Sale of Future Royalties (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Liability Related To Sale Of Future Royalties [Abstract] | |
Schedule of Activity Within Liability Related to Sale of Future Royalties | The following table shows the activity within the liability related to sale of future royalties for the three months ended March 31, 2023: Liability Related to Sale of Future Royalties (in thousands) Balance at December 31, 2022 $ 404,634 Non-cash interest expense recognized 11,000 Balance at March 31, 2023 415,634 Less: Unamortized transaction cost ( 704 ) Carrying value at March 31, 2023 $ 414,930 |
Inventory (Tables)
Inventory (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | All of the Company’s inventories relate to the manufacturing of SKYCLARYS. The following table sets forth the Company’s inventories as of March 31, 2023: Three Months Ended March 31 2023 (in thousands) Raw materials $ 3,446 Work-in-process 2,267 Finished goods — Total $ 5,713 |
Marketable Debt Securities (Tab
Marketable Debt Securities (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Summary of Marketable Debt Securities | The following tables summarize our marketable debt securities (in thousands), as of March 31, 2023: Amortized Gross Gross Fair Value (1) Marketable debt securities: U.S. treasury securities 236,019 17 ( 27 ) 236,009 Total $ 236,019 $ 17 $ ( 27 ) $ 236,009 (1) The fair value was determined using the three-tier fair value hierarchy for disclosure in accordance with Accounting Standards Codification 820-10. The Company’s investments in marketable securities are classified within Level 2 of the fair value hierarchy. The Company uses quoted prices for similar assets sourced from certain third-party pricing services. The third-party pricing services generally utilize industry standard valuation models for which all significant inputs are observable, either directly or indirectly, to estimate the price or fair value of the securities. The primary input generally includes reported trades of or quotes on the same or similar securities. The Company does not make additional judgments or assumptions made to the pricing data sourced from the third-party pricing services. |
Other Income (Expense), Net (Ta
Other Income (Expense), Net (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Other Income and Expenses [Abstract] | |
Summary of Other Income (Expense), Net | Three Months Ended March 31 2023 2022 (in thousands) Other income (expense), net Investment income $ 3,435 $ 132 Non-cash interest expense on liability ( 11,017 ) ( 9,871 ) Other income (expense) 1,920 ( 33 ) Total other income (expense), net $ ( 5,662 ) $ ( 9,772 ) |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Leases [Abstract] | |
Summary of Supplemental Balance Sheet and Other Information Related to Operating Leases | Supplemental balance sheet and other information related to the Company’s operating leases is as follows: As of March 31, 2023 2022 Weighted-average remaining lease term (in years) 15.0 15.6 Weighted-average discount rate 6.5 % 6.5 % |
Schedule of Maturities of Lease Liabilities | Maturities of lease liabilities by fiscal year for the Company’s operating leases: As of March 31, 2023 (in thousands) 2023 (remaining nine months) $ 5,835 2024 (1) 6,457 2025 11,777 2026 12,007 2027 12,241 Thereafter 143,829 Total lease payments (1) 192,146 Less: Imputed interest ( 74,213 ) Present value of lease liabilities $ 117,933 (1) Above table includes one year rent abatement applied beginning in June 2023 following FDA approval of SKYCLARYS |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income Tax Benefit Expense and Effective Income Tax Rate | The following table summarizes income tax benefit expense and effective income tax rate: Three Months Ended March 31 2023 2022 (in thousands, except for percentage data) Benefit from (provision for) taxes on income $ — $ ( 31 ) Effective income tax rate 0.0 % 0.0 % |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Summary of Time Based and Performance-Based Stock Compensation Expense | The following table summarizes time-based and performance-based stock compensation expense reflected in the consolidated statements of operations: Three Months Ended March 31 2023 2022 (in thousands) Research and development $ 14,270 $ 7,606 Selling, general and administrative 23,787 7,838 Total stock compensation expense $ 38,057 $ 15,444 |
Summary of Restricted Stock Units | The following table summarizes RSUs as of March 31, 2023, and changes during the three months ended March 31, 2023, under the Second Amended and Restated Long Term Incentive Plan (LTIP Plan): Number of Weighted-Average Outstanding at January 1, 2023 1,151,656 $ 45.45 Granted 453,049 40.03 Vested ( 352,042 ) 34.64 Forfeited ( 13,113 ) 50.56 Outstanding at March 31, 2023 1,239,550 $ 46.48 |
Summary of Stock Option Activity | The following table summarizes stock option activity as of March 31, 2023, and changes during the three months ended March 31, 2023, under the LTIP Plan and standalone option agreements: Number of Weighted- Outstanding at January 1, 2023 6,009,199 $ 65.92 Granted 1,784,222 37.69 Exercised ( 519,224 ) 25.21 Forfeited ( 248,260 ) 188.95 Expired ( 44,033 ) 111.59 Outstanding at March 31, 2023 6,981,904 $ 56.57 Exercisable at March 31, 2023 3,376,690 $ 64.37 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Additional Information (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Significant Accounting Policies [Line Items] | |
Cost of commercially saleable product and materials | $ 39.2 |
Collaboration Agreements - Addi
Collaboration Agreements - Additional Information (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | |||
Jul. 27, 2021 | Dec. 31, 2009 | Mar. 31, 2023 | Mar. 31, 2022 | Oct. 31, 2019 | |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Decrease in revenue recognition | $ 0 | $ 893 | |||
Collaboration revenue | 195 | $ 914 | |||
Kyowa Kirin Agreement | License Agreement Terms | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Upfront license fee received | $ 35,000 | ||||
Collaboration revenue, milestone payments received | 50,000 | ||||
Collaboration revenue, potential milestone payments | 47,000 | ||||
Collaboration revenue, additional potential commercial milestone payments | $ 140,000 | ||||
Collaboration agreement earned milestone payment | $ 5,000 | ||||
Collaboration revenue | 4,700 | ||||
Deferred Revenue | $ 300 | ||||
AbbVie | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Payable to collaborators | $ 330,000 |
Liability Related to Sale of _3
Liability Related to Sale of Future Royalties - Additional Information (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | ||
Jun. 24, 2020 USD ($) Account $ / shares shares | Mar. 31, 2023 USD ($) | Mar. 31, 2022 USD ($) | |
Liability Related To Sale Of Future Royalties [Line Items] | |||
Proceeds from issuance of common stock, net | $ 1 | $ 0 | |
Number of units of accounting related to consideration received | Account | 2 | ||
Liability related to sale of future royalties, net | $ 294,500 | ||
Transaction cost of liability related to sale of future royalties | 800 | ||
Transaction consideration allocated to common shares | $ 55,500 | ||
Effective interest rate including transaction costs | 13.80% | ||
Non cash interest expense recognized percentage | 10.90% | ||
Development Agreement | |||
Liability Related To Sale Of Future Royalties [Line Items] | |||
Proceeds from royalty agreement | $ 300,000 | ||
Purchase Agreement | |||
Liability Related To Sale Of Future Royalties [Line Items] | |||
Proceeds from issuance of common stock, net | 50,000 | ||
Purchase Agreement | Common Stock A | BXLS | |||
Liability Related To Sale Of Future Royalties [Line Items] | |||
Proceeds from issuance of common stock, net | $ 50,000 | ||
Issuance of common stock | shares | 340,793 | ||
Shares issued, price per share | $ / shares | $ 146.72 |
Liability Related to Sale of _4
Liability Related to Sale of Future Royalties - Schedule of Activity Within Liability Related to Sale of Future Royalties (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Liability Related To Sale Of Future Royalties [Abstract] | |
Liability related to sale of future royalties, Balance at December 31, 2022 | $ 404,634 |
Non-cash interest expense recognized | 11,000 |
Liability related to sale of future royalties, Balance at March 31, 2023 | 415,634 |
Less: Unamortized transaction cost | (704) |
Liability related to sale of future royalties, Carrying value at March 31, 2023 | $ 414,930 |
Inventory - Schedule of Invento
Inventory - Schedule of Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 3,446 | |
Work-in-process | 2,267 | |
Finished goods | 0 | |
Total | $ 5,713 | $ 0 |
Marketable Debt Securities - Su
Marketable Debt Securities - Summary of Marketable Debt Securities (Details) $ in Thousands | Mar. 31, 2023 USD ($) | |
Marketable Securities [Line Items] | ||
Marketable Debt Securities, Amortized Cost | $ 236,019 | |
Marketable Debt Securities, Unrealized Gains | 17 | |
Marketable Debt Securities, Unrealized Loss | (27) | |
Marketable Debt Securities, Fair Value | 236,009 | [1] |
U.S. Treasury Securities | ||
Marketable Securities [Line Items] | ||
Marketable Debt Securities, Amortized Cost | 236,019 | |
Marketable Debt Securities, Unrealized Gains | 17 | |
Marketable Debt Securities, Unrealized Loss | (27) | |
Marketable Debt Securities, Fair Value | $ 236,009 | [1] |
[1] The fair value was determined using the three-tier fair value hierarchy for disclosure in accordance with Accounting Standards Codification 820-10. The Company’s investments in marketable securities are classified within Level 2 of the fair value hierarchy. The Company uses quoted prices for similar assets sourced from certain third-party pricing services. The third-party pricing services generally utilize industry standard valuation models for which all significant inputs are observable, either directly or indirectly, to estimate the price or fair value of the securities. The primary input generally includes reported trades of or quotes on the same or similar securities. The Company does not make additional judgments or assumptions made to the pricing data sourced from the third-party pricing services. |
Other Income (Expense), Net - S
Other Income (Expense), Net - Summary of Other Income (Expense), Net (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Other income (expense), net | ||
Investment income | $ 3,435 | $ 132 |
Non-cash interest expense on liability related to sale of future royalty | (11,017) | (9,871) |
Other income (expense) | 1,920 | (33) |
Total other income (expense), net | $ (5,662) | $ (9,772) |
Other Income (Expense), Net - A
Other Income (Expense), Net - Additional Information (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Other Income and Expenses [Abstract] | |
Other income related to employee retention credit | $ 2 |
Leases - Additional Information
Leases - Additional Information (Details) $ in Thousands | 3 Months Ended | ||||||
Mar. 08, 2022 | Feb. 04, 2022 | Oct. 15, 2019 ft² | Mar. 31, 2023 USD ($) ft² | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | Dec. 15, 2021 USD ($) | |
Lessee Lease Description [Line Items] | |||||||
Cash paid for amounts included in the measurement of lease liabilities | $ 3,900 | ||||||
Operating lease, expense | 4,300 | $ 4,300 | |||||
Operating lease right-of-use asset | 103,807 | $ 105,258 | |||||
Operating lease liability | $ 117,933 | ||||||
Plano Texas | |||||||
Lessee Lease Description [Line Items] | |||||||
Operating lease, option to extend | extended the lease for the Plano office to December 31, 2023 | ||||||
Lease expiration date | Dec. 31, 2023 | ||||||
Plano Texas | Office Space | |||||||
Lessee Lease Description [Line Items] | |||||||
Area of real estate property | ft² | 122,000 | ||||||
Plano Texas | Office And Laboratory Space | 2019 Lease Agreement | |||||||
Lessee Lease Description [Line Items] | |||||||
Area of real estate property | ft² | 327,400 | ||||||
Operating lease, existence of option to extend | true | ||||||
Renewal lease term, option one | two consecutive five-year renewal periods | ||||||
Lease initial term | 16 years | ||||||
Renewal lease term, option two | one ten-year renewal period | ||||||
Operating lease right-of-use asset | $ 124,500 | ||||||
Operating lease liability | 133,200 | ||||||
Lease Incentive, net | $ 8,700 | ||||||
Irving Texas | |||||||
Lessee Lease Description [Line Items] | |||||||
Operating lease, existence of option to extend | true | ||||||
Operating lease, option to extend | extended the lease for the office and laboratory space in Irving, Texas, to October 31, 2024 | ||||||
Operating lease, renewal Term | 12 months | ||||||
Lease expiration date | Oct. 31, 2024 | ||||||
Irving Texas | Office And Laboratory Space | |||||||
Lessee Lease Description [Line Items] | |||||||
Area of real estate property | ft² | 34,890 |
Leases - Summary of Supplementa
Leases - Summary of Supplemental Balance Sheet and Other Information Related to Operating Leases (Details) | Mar. 31, 2023 | Mar. 31, 2022 |
Leases [Abstract] | ||
Weighted-average remaining lease term (in years) | 15 years | 15 years 7 months 6 days |
Weighted-average discount rate | 6.50% | 6.50% |
Leases - Schedule of Maturities
Leases - Schedule of Maturities of Lease Liabilities (Details) $ in Thousands | Mar. 31, 2023 USD ($) | |
Leases [Abstract] | ||
2023 (remaining nine months) | $ 5,835 | |
2024 | 6,457 | [1] |
2025 | 11,777 | |
2026 | 12,007 | |
2027 | 12,241 | |
Thereafter | 143,829 | |
Total lease payments | 192,146 | [1] |
Less: Imputed interest | (74,213) | |
Present value of lease liabilities | $ 117,933 | |
[1] (1) Above table includes one year rent abatement applied beginning in June 2023 following FDA approval of SKYCLARYS |
Income Taxes - Summary of Incom
Income Taxes - Summary of Income Tax Benefit Expense and Effective Income Tax Rate (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Tax Disclosure [Abstract] | ||
Benefit from (provision for) taxes on income | $ 0 | $ (31) |
Effective income tax rate | 0% | 0% |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Total intrinsic value of outstanding options | $ 313,600 | ||
Total intrinsic value of exercisable options | $ 141,100 | ||
Weighted average anti-dilutive shares excludes from computation of earnings per share | 8,221,454 | 6,878,671 | |
Compensation expense | $ 38,057 | $ 15,444 | |
2022 Employee Stock Purchase Plan | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
common stock, shares authorized issuance | 500,000 | ||
Percentage of closing price of common stock | 85% | ||
Compensation expense | 200 | ||
Restricted Stock Unit (RSUs) and Performance-based (RSUs) | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Unrecognized compensation expense | 41,200 | ||
Performance-based RSUs | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Unrecognized compensation expense | $ 4,400 | ||
Performance-based stock options deemed not probable of vesting | 36,500 | ||
Stock Options | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Unrecognized compensation expense | $ 92,100 | ||
Performance-based Stock Options | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Unrecognized compensation expense | $ 13,200 | ||
Performance-based stock options deemed not probable of vesting | 172,500 |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Time Based and Performance-Based Stock Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Total stock compensation expense | $ 38,057 | $ 15,444 |
Research and Development Expenses | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Total stock compensation expense | 14,270 | 7,606 |
Selling, general and administrative | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Total stock compensation expense | $ 23,787 | $ 7,838 |
Stock-Based Compensation - Su_2
Stock-Based Compensation - Summary of Restricted Stock Units Activity (Details) - Restricted Stock Unit (RSUs) | 3 Months Ended |
Mar. 31, 2023 $ / shares shares | |
Number of RSUs | |
Number of RSUs - Beginning balance | shares | 1,151,656 |
Number of RSUs, Granted | shares | 453,049 |
Number of RSUs, Vested | shares | (352,042) |
Number of RSUs, Forfeited | shares | (13,113) |
Number of RSUs - Ending balance | shares | 1,239,550 |
Weighted-Average Grant Date Fair Value | |
Weighted-Average Grant Date Fair Value - Beginning balance | $ / shares | $ 45.45 |
Weighted-Average Grant Date Fair Value, Granted | $ / shares | 40.03 |
Weighted-Average Grant Date Fair Value, Vested | $ / shares | 34.64 |
Weighted-Average Grant Date Fair Value, Forfeited | $ / shares | 50.56 |
Weighted-Average Grant Date Fair Value - Ending balance | $ / shares | $ 46.48 |
Stock-Based Compensation - Su_3
Stock-Based Compensation - Summary of Stock Option Activity (Details) | 3 Months Ended |
Mar. 31, 2023 $ / shares shares | |
Number of Options, Abstract | |
Number of Options, Outstanding - Beginning balance | shares | 6,009,199 |
Number of Options, Granted | shares | 1,784,222 |
Number of Options, Exercised | shares | (519,224) |
Number of Options, Forfeited | shares | (248,260) |
Number of Options, Expired | shares | (44,033) |
Number of Options, Outstanding - Ending balance | shares | 6,981,904 |
Number of Options, Exercisable | shares | 3,376,690 |
Weighted Average Price, Abstract | |
Weighted-Average Price, Outstanding - Beginning balance | $ / shares | $ 65.92 |
Weighted-Average Price, Granted | $ / shares | 37.69 |
Weighted-Average Price, Exercised | $ / shares | 25.21 |
Weighted-Average Price, Forfeited | $ / shares | 188.95 |
Weighted-Average Price, Expired | $ / shares | 111.59 |
Weighted-Average Price, Outstanding - Ending balance | $ / shares | 56.57 |
Weighted-Average Price, Exercisable | $ / shares | $ 64.37 |
Employee Benefit Plans - Additi
Employee Benefit Plans - Additional Information (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Retirement Benefits [Abstract] | ||
Defined benefit plan, description | we adopted an Employee Investment Plan, qualified under Section 401(k) of the Internal Revenue Code, which is a retirement savings plan covering substantially all of our U.S. employees (the Plan). | |
Defined contribution plan employer discretionary contribution amount | $ 1,000 | |
Maximum employee contributions to the plan annually | $ 7,000,000 | $ 7,000,000 |
Period of matching contributions to vest | 4 years | 4 years |
Defined contribution plan including contributions and administrative costs expenses | $ 1,400,000 | $ 1,300,000 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | |
Liabilities relating to indemnification, description | Accordingly, the Company has not recognized any liabilities relating to these obligations as of March 31, 2023. |
Liabilities recognized related to indemnification | $ 0 |
Accrual expenses related to indemnification | $ 0 |